Friday, July 12, 2013

Barnett to oppose Browse Basin lease changes

Barnett to oppose Browse Basin lease changes

West Australian Premier Colin Barnett will oppose a push by the Woodside-led Browse Basin gas project partners to alter the conditions of their retention leases and process the gas offshore, rather than on the Kimberley coast.
The refusal to change the gas leases will frustrate plans by the Browse partners – Woodside, Shell, BP, Mitsubishi/Mitsui and PetroChina – to progress the multibillion-dollar project using floating liquefied natural gas (FLNG) ­technology.
Mr Barnett told The Australian Financial Review he had no intention of adhering to calls to relax conditions in the Browse gas retention leases con­trolled by the state.
“They don’t expire till the end of next year so you may ask, ‘Why the rush?’ ” Mr Barnett said in an interview.


  1. Ancient stygofauna could halt Santos's Pilliga Forest coal seam gas project

    A microscopic collection of worms and mites could play havoc with Santos's biggest coal seam gas project in the New South Wales Pilliga Forest.

    The ancient, subterranean creatures that live deep in an underground aquifer, are only one millimetre long and thinner than a human hair.

    They are known as stygofauna and they play an important role in filtering and determining the quality of groundwater.

    The new evidence about the stygofauna is contained in one of 1,800 submissions to the Federal Government opposing Santos's plans to drill 18 gas wells in the Pilliga Forest near Narrabri.

    Santos had estimated the project could supply 25 per cent of New South Wales's gas needs.

    The Government will now use its recently passed "water trigger" laws to determine if Santos can go ahead with the drilling.

    Hydro-biologist Peter Serov, who found the two new species of stygofauna, says the creatures could be at risk because they are extremely sensitive to changes in water quality.

    "There needs to be a lot more rigorous sampling and monitoring of both water chemistry and biodiversity across the region to determine what the ultimate ranges of these species are and what their environmental requirements are at this point in time," he said.


    Blind, clear, subterranean creatures

    Mr Serov says stygofauna are highly specialised organisms that have been around for hundreds of millions of years.

    "They are a group that have adapted over millions of years to occupy a very, very specialised niche," he said.

    "Initially all of them would have been surface invertebrates, but due to the vast changes that the environment of Australia has gone through... they have colonised the subterranean environment and over time they've developed their own body forms to actually live exclusively in this situation."

    "They have no colouration, they're usually totally clear or white, they have no eyes, they have specialised sensory organs that enable them to determine whether they're going up or down," Mr Serov said.

    But Santos groundwater expert Dr Peter Hancock says he wants to know just where the tiny animals were found.

    He says they may not exist in the deep aquifers that coal seam gas wells drill down to.

    "The deeper coal seam aquifers are unlikely to have stygofauna in them. It's the shallow alluvial aquifers that are most likely to have them," he said.

    But outgoing independent MP Tony Windsor, who introduced the water trigger laws, says the scientific process must go ahead before the mining company moves in.

    "We don't fully understand the scientific nature of some of these groundwater systems and until we do at a scientific level, I think the political process should step back and the industry process should step back until we get the science right and then make the decision," he said.

  2. No CSG drilling in Sydney water catchment

    Drilling for coal seam gas in Sydney's drinking water catchment has been put on hold after a government commission found uncertainty about the risks.

    The Planning Assessment Commission (PAC) has advised against allowing Apex Energy to drill 16 exploration CSG wells in the Illawarra/Wollongong area, south of Sydney.

    The local community - which has been fighting the project since Apex was first granted approval for 15 wells in 2009 - has claimed it as a "huge win" in the battle to protect Sydney's drinking water.

    "But we are celebrating winning a battle, not the war," said Stop CSG spokeswoman Jess Moore.

    "The campaign to have O'Farrell keep his promise and ban CSG development in drinking water catchments will continue."

    In its report published on Wednesday, the PAC pointed out the CSG industry was relatively new to NSW and currently operated at only a handful of sites.

    It also stated that the impacts of CSG activities were being questioned in a range of studies in NSW, Australia and internationally.

    "It appears that the potential risks of coal seam gas activities are still being established and there is some uncertainty regarding the potential impacts," the report said.

    It said that until conclusive findings could be made it would be inappropriate to approve any coal seam gas activities in special areas of the Sydney water catchment.

    The PAC also advised waiting for NSW Chief Scientist and Engineer, Mary O'Kane, to complete her review into all coal seam gas activity in NSW, including the effect on groundwater and drinking water.

    NSW Premier Barry O'Farrell announced the review in February. He also announced a ban on all CSG activity within 2km of residential areas.

    The PAC report said it expected Ms O'Kane's report "will take some time to complete".

    Greens MP Jeremy Buckingham said the idea of drilling and fracking in Sydney's drinking water catchment area was "always ludicrous".

    "This PAC decision is a victory for common sense," he said.

    "Sydney's drinking catchment should be protected from a toxic heavy industry like coal seam gas."

    Mr Buckingham called on the O'Farrell government to ban CSG exploration permanently.

    "Prior to the last election, Barry O'Farrell promised to end mining and exploration in water catchments - no ifs, no buts, a guarantee," he said.
    Comment was being sought from the NSW government.

  3. Gas boom has the activists fired up, state still negotiating fair share

    DELAYED royalty negotiations over Queensland's multi-billion-dollar coal-seam gas industry threaten a repeat of the federal government's mining tax, which has failed to raise the forecast revenue.

    The state government has confirmed it has yet to conclude negotiations with two of the three gas operators, thought to be Origin Energy and Santos.

    And activists claim the royalties to the state could be a fraction of the estimated peak of $900 million a year.

    The state's 2013 budget papers recorded royalty income of $409m in 2011-12, which is forecast to fall slightly to $403m in 2012-13 before rising to $479m in 2013-14 and eventually $924m in 2017.

    The companies with locked-in Queensland projects - Santos, BG Group's Queensland Gas Company and Origin Energy - have agreed to pay a legislated 10 per cent of the wellhead price in royalties to the state government. A fourth company, Arrow Energy - a joint venture between Shell and PetroChina - has yet to make a final decision on its project.

    Together the companies are pursuing projects worth $65 billion that will extract gas from tens of thousands of wells across the state and convert it into liquefied natural gas at plants currently under construction near Gladstone in central Queensland. Most of the LNG will be shipped to overseas markets.

    The royalty rate is based on the price that the companies apply to their gas at the wellhead before its conversion to LNG, less the cost of transport to the plant.


    Activists claim that royalty rates from the Arrow Energy project in Queensland's Surat Basin could be as low as 3.3 per cent after deducting cost overruns.

    The projects have all been hit with cost overruns of 10-15 per cent, including the expense of extracting and disposing of much greater volumes of water from the coal seams than first estimated.

    Last year Santos announced that it would spend an extra $2.5bn in surface costs, an increase of up to 15 per cent that will be deducted against royalties.

    Another oil and gas analyst, who declined to be named, said it was likely the companies would not make the returns they were once hoping for.

    He said when the companies made their financial decisions on the projects there was the expectation of a return of about 13.5 per cent on the investment. Now, based on publicly announced cost overruns, that has dropped to about 11 per cent.

    "But the market has a short memory and once you are through the (capital expenditure) hump, these projects are going to be spinning off bucketloads of money," he said.

    Drew Hutton, an organiser of the anti-CSG movement Lock the Gate, said that the projects would not generate the royalties the government was hoping to receive.

    Origin Energy chief executive Grant King said the standard legislation was for a royalty of 10 per cent of the wellhead revenue, at the gas field, which then had the cost of getting the gas to the plant and transferring it to LNG deducted.

    "It is right to say costs will be deducted but it is misleading to suggest they are getting less than they ought to get," he said.

  4. Motley group of activists owe much to the 'frack man'

    IT'S a protest movement so diverse its factions concede they share nothing but their opposition to the rapid advance of coal-seam gas projects across the nation, but as Queensland's gas boom divides opinion, the state government, and the companies that have invested up to $65 billion, are finding the Lock the Gate Alliance more difficult to ignore.

    Cost over-runs, pressure on gas prices and strong competition for export markets, analysts say, may turn hopes of a CSG-led recovery into a pipedream, much to the delight of its critics.

    Lock the Gate and its fellow travellers range across political and social spectrums. At one end there are Sydney talkback radio king Alan Jones, pokies heir Kjerulf Ainsworth and old-money farmers from Queensland's deep black soil plains. At the other is a transient army of radical environmentalists, professional protesters, misfits and agitators. This weekend more than 100 have gathered at Tara, two hours west of Toowoomba, for a campaign of direct action.

    At the helm is a former tunnel digger from Sydney, Dayne Pratzky, 39. He calls himself "the frack man", an ironic reference to the practice of injecting fluids and sand at high pressure to liberate the methane gas.

    "This weekend's protests are the last stand," he said. "This will be an all-out assault on QGC, where we aim to cause maximum delay and disruption to work on the company's Kenya Gas fields."

    The event kicked off with protesters, posing as workers, climbing QGC's reverse osmosis plant on Thursday and unfurling a Lock the Gate banner. "I can't say who went in," he said, " but the people who did scaled a 200-foot-high tower and nobody challenged them. On the way out some of the workers were actually cheering them on. I estimate that every time we spend a dollar in organising events like this, it costs the company $100,000."

    Mr Pratzky lives in what farmers call "goanna country", where the state's gas rush began in 2009. The "blockies" made their homes in the Wieambilla estates near Tara because nobody else wanted this scrubby, good-for-nothing country.....

    Mr Pratzky bought his 100ha sight unseen off the internet while recovering from an injury suffered while he was working in Sydney's Lane Cove Tunnel.

    But then the Queensland Gas Company, now owned by British Gas, came to drill in the Tara area.

    "The law says that I had no right to stop them coming on my land, but no company, let alone a foreign-owned one, is going to tell me what to do on my own land," he said.


    In April 2009, Mr Pratzky organised a four-day blockade of trucks and his life changed forever.

    In 2010, environmentalist Drew Hutton, a veteran Greens candidate, was looking for "a community to start a campaign of civil disobedience."

    "The farmers were too tentative to get involved in militancy so I had to go to the blockies, who were prepared to dig their heels in," he said.

    In Mr Pratzky he saw a chance to mould a perfect weapon of dissent, so he trained him in non-violent protest techniques. Kjerulf Ainsworth, son of pokie king Len Ainsworth, provided financial support for lawyers and equipment.

    The frack man has been waging a guerilla war, often on his own, against QGC ever since....


    Yet the concept is so fraught with ambiguity that bureaucrats have given up trying to explain it. A parliamentary committee concluded in March there was "no agreement between interest groups on the definition".

    The critics say it's typical of the Queensland government's "adaptive management" approach to the gasfields, which means they will fix environmental, financial and social problems as they come along.


    The next battleground in Queensland will be the rich farming country at Cecil Plains two hours east of Tara, which is targeted for gas development by Arrow Energy, a joint venture between Royal Dutch Shell and PetroChina.

  5. Big gas fills state coffers

    FROM the air a mosaic of gas wells connected by access roads is scattered across hundreds of square kilometres from the Darling Downs to central Queensland.

    Frantic work is under way to lay the pipelines needed to pump the gas to Gladstone, where tens of billions of dollars have already been spent building huge refrigeration plants that will process the gas for export to eager Asian buyers.

    The burgeoning Queensland coal-seam gas industry has long passed the point of no return. It is an industry that Queensland hopes will transform the state's economy and provide a welcome new stream of income for farmers on marginal land.

    But the speed and scale of the rollout has left some residents gasping for breath. It has proved fertile ground in which to seed an unlikely coalition of opposition groups that span the full spectrum of political views.

    Conservative farmers with concerns about water quality and property rights are standing shoulder to shoulder with battle-hardened activists who regard coal-seam gas as an unwelcome lifeline for the fossil-fuel industry.

    As in North America, the modern-day gas rush is transforming the nation's energy economics. But unlike the US, where a supply glut in gas has caused energy prices to plunge and promises to herald a new age of domestic manufacturing, the impact in Australia is likely to be the opposite.

    Domestic gas prices are expected to soar as local users are forced to compete for supplies with foreign buyers prepared to pay a much higher price.

    The size of the community revolt against CSG has caught the industry and government flat-footed.

    It has sparked serious debate about the need for companies to have a "social licence" to operate.

    It is legitimate to ask whether the state government was railroaded to embrace an infant industry with too much haste, and too little regard for the community and environmental impacts it would bring.

    Once committed, the state has already been pressured to relax environmental controls on the disposal of the huge volume of treated water into local river systems, which flow into some of Australia's most precious natural areas.

    Regulatory agencies appear geared to reinforce the earlier decisions of consent.


    Many in the industry badly misjudged the need to deal properly with landowners, particularly the low-income bush block residents near Tara, west of Toowoomba, where Queensland Gas Corporation faces guerilla-style protests and rising complaints of health impacts that protest groups say are not being investigated properly.

    There is wide support for rigorous safeguards on the protection of underground water supplies and the preservation of high-value agricultural land.

    An independent scientific panel established by the federal government has been scathing of Arrow Energy's plans to operate below the aquifers on Cecil Plains, which are regarded as having some of the most productive soils in the world.

    "It's unique, there is nowhere else in the world where it is proposed to mine gas with the existing land use that we have and the shallow alluvial (soil) that underlies it," Cecil Plains cotton grower Graham Clapham says. But Cecil Plains is considered essential to Arrow Energy's CSG ambitions.

    Despite the protests, QGC says it has 1700 of the 2000 agreements it needs for the first production of liquefied natural gas from its project. The company says it has drilled 1300 of the more than 2000 wells required to produce its full capacity of 8.5 million tonnes of LNG a year.


  6. Big gas fills state coffers...cont...

    The position of Lock the Gate, the umbrella organisation for dozens of smaller groups, is "ring fencing", not coexistence.

    "We are totally opposed to this ideological view that you can have coexistence with CSG and agriculture or CSG and tourism," says Lock the Gate spokesman Drew Hutton.

    "We say where you have got good farmland, important environmental areas, closely settled areas or areas where there are vulnerable underground water systems then you put a fence around them and don't allow CSG.

    "My job is not to tell them where they can go; my job is to tell them where they can't go."

    The divide between farm groups and farmers is particularly evident in negotiations to open up what could be the next gas and mining frontier, the Channel Country in the far west of the state.

    In negotiations to date, Queensland's peak farm body, AgForce, has lined up squarely with the resources industry, against the wishes of local farmers. The peak farm organisations also sided with big gas in its submission to the federal Senate inquiry into the water trigger legislation conceived by retiring independent Tony Windsor.

    The NFF argued that water constraints imposed on the gas industry could ultimately come back to haunt farmers. But Clapham says they are already subject to much tougher water regulations than the CSG industry.

    The main concern of environmental groups and farmers is the use of an "adaptive management" regime for mining, where resource companies promise to make good any damage they may do. They would rather a much stricter "precautionary principle" be applied.

    "The entire EIS (environmental impact statement) and EA (environmental assessment) process is designed to audit the damage and losses," Darling Downs veterinarian Kylie Goldthorpe says. "Almost none of it actually protects the environment. Nor is there effective independent monitoring or policing of mining activities."

    The issue with water is not confined to the potential for underground contamination in the Great Artesian Basin.

    The volume of salty "production" water from CSG is staggering. The three big LNG projects being developed in Queensland combined will extract a total of about 150 megalitres a day on average from next year to 2040. QGC says the water would not otherwise be used for agriculture or human consumption because it is too salty.

    QGC and Origin Energy have built reverse osmosis water-treatment plants and have permission to release large volumes of water, which ultimately make their way into the Condamine River.

    QGC says water is an unavoidable byproduct of gas production and too much water can make gas projects uneconomic.

    The company says it has approval to release 85 megalitres of treated water a day into the Condamine River and 100 megalitres of treated water a day into the Dawson River at peak production.

    "We are very confident we can use treated water without environmental harm, and so are the state and national regulators," a QGC spokesman says.

    Santos has been given approval to release large quantities of treated CSG water into the Dawson River, between Injune and Taroom in central Queensland, which ultimately will make its way to the Fitzroy delta.

    Santos's application included an admission that the treated water would not meet Queensland government guidelines. The breaches include total suspended solids almost double the guidelines, ammonia 45 times the guidelines, sulphate 80 times the guidelines and boron eight times the guidelines.

    Santos says the Australian water quality guidelines are not mandatory and levels should be set on a project basis. A company spokesman says an expert panel review has found the scheme would "not have any significant impacts on the receiving environmental values of the Dawson River, tributary gully or waterhole".

    Conservation groups, however, remain concerned about the cumulative effect of the water releases.

  7. Big gas fills state coffers...cont...

    Conservation groups, however, remain concerned about the cumulative effect of the water releases.

    Meanwhile, Hutton says landholder resistance has helped push more of the CSG exploration and production on to state forest land. "There are now four state forests in southeast Queensland that have been almost totally annihilated," Hutton says.

    "What you get when you put coal-seam gas through a state forest is not simply a whole lot of gas wells, but gathering lines and road corridors. Basically it fragments a forest and just makes it worthless in terms of any conservation value.

    "If you add the state forest loss to the amount of clearing that has gone on with the pipeline, we are in the process of losing 75,000ha of native vegetation, which is taking us back to the land clearing rate that was regarded as scandalous a decade ago.

    The state government has its eye firmly fixed on the royalties.

    The 2013 budget papers estimate the royalty income at $409 million in 2011-12, falling slightly to $403m this year before rising to $479m next year, $662m in 2015, $900m in 2016 and $924m in 2017.

    However, the Bligh government did not settle the final royalty arrangements for two of the three LNG proponents, and as a consequence of the method used to levy royalties on gas, state royalties are affected by cost escalation on projects. The extent of the impact depends on the final royalty arrangements, which are still being negotiated.

    Hutton is prepared to be charitable, and realistic, that money rather than corruption has driven Queensland's speedy CSG rollout.

    "They want the books balanced and they see this as a pot of gold at the end of the rainbow," he says. "But this $900m they are talking about will not come for years.

    "If the CSG industry goes south because of competition from the US or Canada, and the export price of gas drops and the profit margins are nil, then we have just wrecked whole sections of the country and risked the water table - for what?"




    In Queensland, coal-seam gas supplies about 90 per cent of the state's natural gas and fuels about 15 per cent of the state's electricity generation.

    Queensland's CSG industry is set to create 20,000 jobs each year for the next 20 years and deliver an increase in Australia's gross domestic product of up to $516 billion.

    Fracking has been used by the resources sector for more than 60 years internationally, and 40 years in Australia, to improve the flow of natural gas.

    If a CSG well requires fracking, a gel is used to help natural gas flow to the surface. Fracking gel is 99 per cent sand and water with the remaining 1 per cent containing common additives. Toxic chemicals such as BTEX are banned from use in gel here.

    It is estimated the CSG industry will extract 75,000 megalitres of water a year from the Surat Basin area of the Great Artesian Basin, or 0.0002 per cent of total water resources. This is much less than the 620,000 megalitres used each year by other industries, including agriculture.

    Stringent codes govern how CSG wells are constructed. This includes requiring them to be encased in steel and cement. In addition, the millions of tonnes of impermeable rock typically found between coal seams and aquifers act as a natural barrier.

    Greenhouse gas emissions from all stages of CSG production represent about 0.3 per cent of Australia's National Greenhouse Gas Inventory. Livestock in Australia accounts for 12 per cent of emissions.

  8. Loads of cash 'will win LNG doubters'

    QUEENSLAND'S $60 billion LNG projects will generate "bucket loads" of cash once in operation and be supported by the market, the industry has argued, as it dismisses claims investors are cool on the sector because it lacks a "social licence" to operate.

    The main players behind the plants being developed on Curtis Island, which will liquefy gas taken from coal seams in western Queensland for export mainly to Asia, have been forced to defend their financial outlook.

    Drew Hutton, president of activist group Lock The Gate Alliance, has been spearheading the campaign, claiming investors have told him the companies are not a sound investment because they lack that "social licence".

    Mr Hutton said he had presented the case against investing in coal-seam gas to more than 30 fund managers, superannuation and investment companies, and outlined to them to what extent the industry and companies are accepted by communities.

    "They (investors) have said to me, do not invest in companies that do not have a social licence and this industry does not seem to have a social licence," he said.

    The projects are the Gladstone LNG project led by Santos, BG Group's Queensland Curtis LNG plant and the Australia Pacific LNG plant run by Origin Energy and ConocoPhillips.

    A fourth LNG export project on Curtis Island is proposed by Shell/PetroChina, with a final investment decision due next year.

    But it is expected the projects supporting CSG reserves will be wrapped into a joint venture with one of the existing projects.

    Each project is about a $20bn investment, which equates to an investment of $14m a day, every day, over four years.

    Origin Energy chief executive Grant King said the lack of the "social licence" to operate was the opinion of a small group, a view, he said, not supported by evidence. "The term social licence does not have a legal meaning. The company's licence to operate is provided by the government through comprehensive environmental consenting processes that set the terms and conditions by which the company can operate."


    To operate the first two trains of its LNG project, Origin needs to develop roughly 1100 wells and to date it has reached voluntary consent with landowners covering 75 per cent of those wells.

    Rob Millhouse, vice-president policy and corporate affairs of BG Group's Australian subsidiary QGC, said its polling had consistently showed a strong majority of people in its project area supported its project and the industry.

    "The Greens saying our projects are uneconomic because we don't have a social licence is akin to Robert Mugabe saying Australia is undemocratic because we have free and fair elections," he said.

    "With about 8 per cent of the popular vote, we are not sure the Greens have a licence to object to or stop an industry that has created about 100,000 jobs in the past year and involves an investment of $65bn in Queensland alone. We are investing $20bn because our project is economic."

    The projects have all been hit with cost overruns and one analyst said it was likely the companies would not make the returns they had hoped. When companies made their investment decisions there was the expectation of about a 13.5 per cent return. Now, based on publicly announced cost overruns, that is closer to 11 per cent.

    "But the market has a short memory and once you are through the capex hump these projects are going to be spinning off bucket loads of money," he said.

    "They are going to be making around a $US72 margin. The market is going to love them once they are onstream and the development risk has been dealt with. It's not good for return on investor capital, but they are going to be extremely cash generative."

  9. Broome $8m bill after shelved gas hub

    A Kimberley council has blamed part of a potential $8 million budget deficit on compiling detailed reports relating to the shelved James Price Point gas hub, 50km north of Broome.

    Shire of Broome president Graeme Campbell warned that capital and community projects would be axed or delayed and operational costs slashed as part of belt-tightening in the 2013-14 financial year.

    He said the black hole was compounded by "hundreds of man hours" spent on various information required for JPP, including a massive workers camp near the town that has also been dropped.

    "We received $50,000 from the State Government to do a capacity audit, which subsequently proved we would be severely stretched," Mr Campbell said.

    "We approached the Government for more staff or funds to deal with the proposal but that was refused. As a consequence we incurred significant costs relating to JPP."

    Mr Campbell said several staff who had recently left would not be replaced but he was confident there would be no redundancies. Some requests for additional employees would not be approved.

    Mr Campbell said rates would need to increase by more than 40 per cent to cover the $8 million preliminary budget wish list submitted by all departmental heads.

    "You can see that to raise that sort of money is impractical and we won't be going down that path," he said.

    Some operational expenses would be cut, some capital expense on plant and equipment would not happen, surplus equipment not being used would be disposed of and a series of capital and community projects would be cut or delayed.

    "There have been several resignations or retirements of staff in the past three or four months and it is very likely these people will not be replaced," he said.

    Mr Campbell said it was important to keep a lid on rates, which have more than doubled over the past decade.
    He said the council was under continued pressure to meet demands for more facilities as the population grew.

    1. WA Premier Colin Barnett admits frontline services will be affected by public sector job cuts

      A peak union says the Premier Colin Barnett has gone back on his word and admitted frontline services will be affected as the Government cuts jobs in the public sector.

      Last month the State Government it would offer 1000 voluntary redundancies and sack up to 200 people, if legislation to do so is passed, due to difficult economic times.

      Mr Barnett said the cutbacks would have little impact on frontline services.

      But the Community and Public Sector Union's Rikki Hendon says during a recent meeting Mr Barnett said the cutbacks would be felt in the education and health sectors.

      "But we believe that these redundancies will have a broad effect in terms of an effect on frontline services for all public services," she said.

      The Opposition finance spokeswoman Rita Saffioti says West Australians will be hurt by the changes.

      "Mr Barnett has hidden the truth from the public. Previously he's said front line services will not be affected and now, today it appears front line services will be cut."

      The Premier's Office confirmed his comments and said it will be up to department heads to minimise the impact.

  10. Edward Snowden's hidden documents could cause America's worst nightmare, reporter warns

    A British journalist claims Edward Snowden has more secret data that, if revealed, could become the US government's "worst nightmare".

    The Guardian journalist, Glenn Greenwald, published leaked documents supplied by Snowden in June that revealed details of secret US surveillance programs.

    Greenwald is warning Snowden has more harmful information tucked away in different parts of the world.

    In an interview with Argentinean newspaper La Nacion, Greenwald said the US government should be careful in its pursuit of the former National Security Agency (NSA) contractor.

    "Snowden has enough information to cause more harm to the US government in a single minute than any other person has ever had," he said.

    "The US government should be on its knees every day begging that nothing happen to Snowden, because if something does happen to him, all the information will be revealed and it could be its worst nightmare."


  11. Wall Street Rips Off 'The Sting'

    By Matt Taibbi

    Hilarious corruption story hit the news wires this week. It's actually a two-part joke.

    Part one is that Thomson Reuters got slapped in the face by New York State Attorney General Eric Schneiderman for its absurd practice of selling early access to the results of the consumer confidence survey it conducts each month in conjunction with the University of Michigan.

    It turns out that in recent times, if you paid them an extra subscription fee of a few thousand dollars a month, Thomson Reuters would allow you access to the Consumer Confidence data a full two seconds earlier than the rest of its subscribers – at 9:54:58 a.m., as opposed to 9:55:00 exactly.

    Thomson Reuters suspended the activity at the request of Schneiderman, who released a statement about this humorously brazen effort at the systematic sale of inside information. From the L.A. Times:

    The consumer confidence data can move financial markets, and Scheiderman's office said "that two-second advantage is more than enough time for these traders to take unfair advantage of their early access to this information as they execute enormous volumes of trades in the blink of an eye."

    “The securities markets should be a level playing field for all investors and the early release of market-moving survey data undermines fair play in the markets,” Schneiderman said Monday.

    The two-second head start allows high-speed traders to plunge into the markets en masse and retreat all the way back again before most of the world sees this market-altering economic data. From a CNN report a few weeks ago:

    In the milliseconds before the survey is released to other paying clients at 9:55 a.m. ET, trading volumes can soar up to 20 times their normal levels. By 9:54:59 a.m. ET, long after computers have acted on the number, volumes have already returned to normal.

    As my friend Eric Salzman joked, the two-second head start is a scheme taken straight out of The Sting, where the "hook" was early access to the results of an out-of-state horse race. All that's missing is Robert Shaw placing his bet: "Five hundred thousand dollars to win. Lucky Dan!"


    It's bad enough that this goes on out in the open, but part two of this joke is that nobody's ashamed of it in the slightest. In fact, Thomson Reuters threw the P.R.-office version of a hissy fit today after Schneiderman closed shop on their neat little revenue stream. The firm refused to permanently end the practice and defiantly insisted upon their right to sell data to whomever they want, whenever they want. From a news release:

    Thomson Reuters strongly believes that news and information companies can legally distribute non-governmental data and exclusive news through services provided to fee-paying subscribers . . .

    It is widely understood that news and information companies compete for exclusive news and differentiated content to help their customers make better informed trading and investment decisions . . .

    Mm-hmm. Yes, there's a socially beneficial activity, helping your customers make "better informed trading and investment decisions" two seconds faster than your other customers (read: suckers). Clearly, someone who wants to buy a two-second head start is doing so because he or she needs those extra two seconds to soberly digest market data, not because he or she wants to massively front-run the rest of the investing public using high-speed computers.

    It's amazing how endless these market-scamming stories are. Practically every other day lately, there's news either of a depraved price-fixing scandal (ridiculously, even Hershey's paid a fine a few weeks back for rigging chocolate prices in Canada) or some crude signal-stealing scheme like this thing. What's next, selling card-counting machines for casino-goers?

    Read more:

  12. Gangster Bankers: Too Big to Jail

    How HSBC hooked up with drug traffickers and terrorists. And got away with it

    The deal was announced quietly, just before the holidays, almost like the government was hoping people were too busy hanging stockings by the fireplace to notice. Flooring politicians, lawyers and investigators all over the world, the U.S. Justice Department granted a total walk to executives of the British-based bank HSBC for the largest drug-and-terrorism money-laundering case ever. Yes, they issued a fine – $1.9 billion, or about five weeks' profit – but they didn't extract so much as one dollar or one day in jail from any individual, despite a decade of stupefying abuses.

    People may have outrage fatigue about Wall Street, and more stories about billionaire greedheads getting away with more stealing often cease to amaze. But the HSBC case went miles beyond the usual paper-pushing, keypad-punching­ sort-of crime, committed by geeks in ties, normally associated­ with Wall Street. In this case, the bank literally got away with murder – well, aiding and abetting it, anyway.


    For at least half a decade, the storied British colonial banking power helped to wash hundreds of millions of dollars for drug mobs, including Mexico's Sinaloa drug cartel, suspected in tens of thousands of murders just in the past 10 years – people so totally evil, jokes former New York Attorney General Eliot Spitzer, that "they make the guys on Wall Street look good." The bank also moved money for organizations linked to Al Qaeda and Hezbollah, and for Russian gangsters; helped countries like Iran, the Sudan and North Korea evade sanctions; and, in between helping murderers and terrorists and rogue states, aided countless common tax cheats in hiding their cash.

  13. Gangster Bankers: Too Big to Jail....cont...

    "They violated every goddamn law in the book," says Jack Blum, an attorney and former Senate investigator who headed a major bribery investigation against Lockheed in the 1970s that led to the passage of the Foreign Corrupt Practices Act. "They took every imaginable form of illegal and illicit business."

    That nobody from the bank went to jail or paid a dollar in individual fines is nothing new in this era of financial crisis. What is different about this settlement is that the Justice Department, for the first time, admitted why it decided to go soft on this particular kind of criminal. It was worried that anything more than a wrist slap for HSBC might undermine the world economy. "Had the U.S. authorities decided to press criminal charges," said Assistant Attorney General Lanny Breuer at a press conference to announce the settlement, "HSBC would almost certainly have lost its banking license in the U.S., the future of the institution would have been under threat and the entire banking system would have been destabilized."

    It was the dawn of a new era. In the years just after 9/11, even being breathed on by a suspected terrorist could land you in extralegal detention for the rest of your life. But now, when you're Too Big to Jail, you can cop to laundering terrorist cash and violating the Trading With the Enemy Act, and not only will you not be prosecuted for it, but the government will go out of its way to make sure you won't lose your license. Some on the Hill put it to me this way: OK, fine, no jail time, but they can't even pull their charter? Are you kidding?

    But the Justice Department wasn't finished handing out Christmas goodies. A little over a week later, Breuer was back in front of the press, giving a cushy deal to another huge international firm, the Swiss bank UBS, which had just admitted to a key role in perhaps the biggest antitrust/price-fixing case in history, the so-called LIBOR scandal, a massive interest-rate­rigging conspiracy involving hundreds of trillions ("trillions," with a "t") of dollars in financial products. While two minor players did face charges, Breuer and the Justice Department worried aloud about global stability as they explained why no criminal charges were being filed against the parent company.

    "Our goal here," Breuer said, "is not to destroy a major financial institution."

    A reporter at the UBS presser pointed out to Breuer that UBS had already been busted in 2009 in a major tax-evasion case, and asked a sensible question. "This is a bank that has broken the law before," the reporter said. "So why not be tougher?"

    "I don't know what tougher means," answered the assistant attorney general.

    Also known as the Hong Kong and Shanghai Banking Corporation, HSBC has always been associated with drugs. Founded in 1865, HSBC became the major commercial bank in colonial China after the conclusion of the Second Opium War. If you're rusty in your history of Britain's various wars of Imperial Rape, the Second Opium War was the one where Britain and other European powers basically slaughtered lots of Chinese people until they agreed to legalize the dope trade (much like they had done in the First Opium War, which ended in 1842).

  14. Gangster Bankers: Too Big to Jail....cont...

    A century and a half later, it appears not much has changed. With its strong on-the-ground presence in many of the various ex-colonial territories in Asia and Africa, and its rich history of cross-cultural moral flexibility, HSBC has a very different international footprint than other Too Big to Fail banks like Wells Fargo or Bank of America. While the American banking behemoths mainly gorged themselves on the toxic residential-mortgage trade that caused the 2008 financial bubble, HSBC took a slightly different path, turning itself into the destination bank for domestic and international scoundrels of every possible persuasion.

    Three-time losers doing life in California prisons for street felonies might be surprised to learn that the no-jail settlement Lanny Breuer worked out for HSBC was already the bank's third strike. In fact, as a mortifying 334-page report issued by the Senate Permanent Subcommittee on Investigations last summer made plain, HSBC ignored a truly awesome quantity of official warnings.

    In April 2003, with 9/11 still fresh in the minds of American regulators, the Federal Reserve sent HSBC's American subsidiary a cease-and-desist­ letter, ordering it to clean up its act and make a better effort to keep criminals and terrorists from opening accounts at its bank. One of the bank's bigger customers, for instance, was Saudi Arabia's Al Rajhi bank, which had been linked by the CIA and other government agencies to terrorism. According to a document cited in a Senate report, one of the bank's founders, Sulaiman bin Abdul Aziz Al Rajhi, was among 20 early financiers of Al Qaeda, a member of what Osama bin Laden himself apparently called the "Golden Chain." In 2003, the CIA wrote a confidential report about the bank, describing Al Rajhi as a "conduit for extremist finance." In the report, details of which leaked to the public by 2007, the agency noted that Sulaiman Al Rajhi consciously worked to help Islamic "charities" hide their true nature, ordering the bank's board to "explore financial instruments that would allow the bank's charitable contributions to avoid official Saudi scrutiny." (The bank has denied any role in financing extremists.)

    Read more:

  15. MEANWHILE......

    Back at Moscow Airport Snowden is still waiting.

    Will Obama really scramble the jet fighters for this "hacker"?

    They did force the President of Bolivia to land and be searched for Snowden.....

    Poor hacker if only he would have chosen Wall St instead of Washington he'd be "too big to jail"!


    A few years ago when the argument over JPP was really raging we said this would happen - just like night follows day - THEY said it wouldn't.Well here it is just as we said...

    Woodside, Exxon under pressure as US enters the fray

    GAS export contracts underpinning Australia's $US200 billion ($222bn) worth of new and under-construction LNG plants are coming under pressure as US-led competition leads Asian customers to demand cheaper LNG from two of the nation's big projects.

    Woodside Petroleum faces hurdles in price talks over its Pluto project in Western Australia, and India is calling for lower prices on one of ExxonMobil's Gorgon contracts.

    It is understood Pluto's two customers, Tokyo Gas and Kansai Electric, are forcing Woodside to take changing global gas dynamics into account in price talks over their 15-year contracts, meaning new Pluto pricing from April next year is unlikely to be as healthy as big WA gas contracts signed on other LNG projects such as Gorgon.

    At the same time, Indian newspapers have reported state-owned gas company GAIL, which will import gas from the Sabine Pass LNG project in Louisiana, wants cheaper prices on gas it has agreed to buy from Gorgon through Petronet, in which GAIL has a 12.5 per cent stake.

    The developments, and any precedents that eventuate, do not bode well for Gorgon operator and 50 per cent owner Chevron, which revealed in May that a $30bn gas deal with Korea Gas had fallen through, meaning 35 per cent of its volumes from the 15.6 million tonnes a year project are uncontracted.

    The growing pressure on prices, and the traditional method of linking LNG prices to oil prices, comes as Asian buyers call for big differences in global gas prices to narrow in the face of potentially cheaper new supplies from the US, where there is a domestic gas glut, and East Africa.

    Momentum has shifted more to gas buyers in recent months as the US approved a second LNG project to export to nations without a free trade agreement and as Russia looks to divert gas and LNG to Japan and China because of slowing demand and lower pricing in Europe. Price pressure has been expected on uncontracted Australian LNG volumes and those with clauses in their long-term contracts that allow pricing structures to be tweaked in line with market prices every three to five years.

    But the call to renegotiate an existing contract from India will raise more concerns about the strength of pricing formats embedded in 15 to 20-year LNG contracts, especially those signed with India and China, whose commitment to long-term contracts has been questioned by some analysts.

    It will also weigh on Australia's LNG export revenues and tax take.

    Woodside and its two Japanese Pluto customers are now deep in talks to reset LNG prices in line with current market prices from April, when a sweetener period that capped at about $US8 per million British thermal units is due to end.

    Spot prices in Japan are now about $US15.

  17. WOODSIDE / PLUTO cont....

    It is understood the Japanese buyers have been aggressively pushing for lower prices than would have been expected a year ago and that a softened export market is likely to weigh on the price Woodside achieves.

    The extent of the price discount Woodside will have to take is unclear. If it is $US1 per mmBtu below prices reportedly agreed by Gorgon in its India deal in 2009, the estimated annual hit to Woodside earnings would be $70 million-$80m.

    According to India's Economic Times, Petronet is examining whether renegotiation on its contract to buy 1.5 million tonnes of LNG a year from Gorgon is possible.

    "The circumstances under which price provisions were agreed in the said sales purchase agreement for Gorgon have changed significantly and the same has long-term implications for Petronet and the regassed LNG offtakers (and Petronet shareholders), GAIL, India Oil and Bahrat Petroleum," GAIL reportedly said in a letter to Petronet.

    Woodside, Exxon and Chevron all declined to comment on the developments.

    LNG contracts linked to moves in oil prices are signed under what the industry terms a "slope", which relates to the LNG price paid when oil is at $US100 a barrel.

    A slope of 14.5 per cent, which is the price the Economic Times says Petronet's Gorgon contract is under, means LNG is priced at $US14.50 when oil is $US100.

    "A traditional slope of 14.85 per cent appears out of reach (on Pluto) and we also see risks to our 14 per cent base case assumption given yen depreciation, increasing certainty around US exports and coal-seam gas projects signing in the 13.8 per cent range," Merrill Lynch analyst James Bullen said.

    At a 13.5 per cent slope, Woodside's 2014 earnings were estimated to be $2.02bn, down from $2.09bn estimated at 14.5 per cent, he said. At 12 per cent, earnings fall to about $1.94bn, Merrill Lynch estimated.

    Australian contracts are not the only ones under pressure.

    In Indonesia, China National Offshore Oil Corp is reportedly at loggerheads with the owners of the Tangguh LNG project over a planned price of just $US7.

    "A new price was expected to be agreed prior to May," Mr Bullen said. "This negotiation will set an interesting precedent prior to Woodside's Pluto price negotiation."



    1. LOOKING at those numbers I would say with a LOT of confidence a gas export plant for shale gas from the Canning Basin at JPP is not a financially viable option for Buru or any other operator out there.

      Another one of Barnett's plans for the scrapheap.

      AT this point in time it could also be questioned if the gas will be cheap enough for domestic customers?

      Looking into the future it is easy to see Australian Dom Gas having to compete with imports from East Africa as the talks for new contracts from the NW Shelf are set to skyrocket and the Canning Basin costs being so high.

      No wonder they are spending so much money exploring for sweet spots out there - nothing else could make them any money!


    Rural paradise now a living hell

    IN 2008, George Palmer thought he had realised his Australian dream when he bought land in the Wieambilla Estates at Tara in western Queensland.

    It was cheap, marginal country but Mr Palmer believed the 16ha block would be a quiet place where he and his wife Marion could raise his brood of nine children with clean air and water.

    But then Queensland Gas Company turned their rural retreat into a coal-seam gas field.

    The Palmers believe that emissions from QGC's Kate 2 well, just over 1km from their home, are poisoning their family but no one will listen, much less help them.

    The Palmers and up to 30 other families claim they are faced with walking off their land, which they say has been made almost worthless due to the fear of airborne contaminants. Mr Palmer said whenever a northwest wind blew from the gas well, his 16-year-old daughter Karolina suffered terrible cramps in her arms that are sometimes so severe she has been rushed to hospital in agony. His seven-year-old son Peter has regular nose bleeds while he and his wife endure blinding headaches.

    A urine test last year showed that his four-year-old son Jackson had high levels of hippuric acid, which is related to a neurotoxin called toluene used by miners to fracture the coal seams to liberate the methane gas.

    QGC, now owned by Britain's BG Group, has told the Palmers they are not "fracking" in their area and there is no link between the gas well and their health problems. The use of toluene in fracking is banned in Queensland but it can also be released naturally from the coal seams during the process.

    In December, a pathologist suggested to the Palmers that people with a diet rich in fruit and vegetables, or who drink large quantities of green tea, are prone to elevated levels of hippuric acid. Queensland Health has made the same claims in media reports, Mrs Palmer said.

    "Fruit and veges, well that's just ridiculous," she said. "He's a four-year-old kid. I struggle to get a pea down his neck and as for green tea, it's red cordial all the way."

    The family say they are forced to buy their water in bottles and use their rainwater tanks only for washing dishes.

    A spokesman for QGC told The Australian that a report by Queensland Health into health impacts, published in March, had failed to find any link between coal-seam gas extraction and a range of symptoms experienced by Tara residents.

    The report, "Coal Seam Gas in the Tara Region", found environmental changes in the area might have caused "solastalgia", a psychological condition where personal distress leads to physical symptoms.

  19. Rural paradise now a living hell... cont...

    The QGC spokesman said employees working close to gas wells had experienced none of the symptoms Tara residents complained of. In fact, studies had shown frontline petroleum and gas industry employees "had better health than the general Australian community".

    Debbie Orr, who runs the Gasfields Community Support Group in Tara, said the Queensland Health report was a whitewash. It had been compiled from interviews with 56 people from 11 families resident in the region. There had never been a baseline study to assess the potential impacts on health of life in a gas field.

    Ms Orr said her six children experienced the same symptoms as the Palmer family and also tingling in their hands and feet.

    In response to complaints by residents, QGC has supplied air monitoring systems, which had showed only low levels of fugitive emissions. At a recent meeting in Toowoomba, Ms Orr had asked the chairwoman of BG Australia, Reserve Bank board member Catherine Tanna, to guarantee in writing that the CSG industry was safe for local residents.

    "Catherine Tanna just kept referring to the Queensland Health Report," Ms Orr said. "No one will put it in writing that this industry is safe. There must be a halt to mining while this issue is put beyond doubt."

    She claimed many local people suffering illnesses had failed to inform authorities of a link to CSG wells. On a visit to Tara this month, The Australian was told of two next-door neighbours in the nearby Kumbarilla area who were both suffering from rare stomach cancers but they declined to be interviewed.

    Like many Tara residents, the Palmer family want to be relocated away from the gasfields but QGC has stated categorically there will be no buy-outs.

    Based on nearby property sales, they say the land they paid $60,000 for - and are paying off - is worth as little as $10,000.

    "No one will buy our properties because of the fears about what's in the air or in our water," said Mrs Palmer. "We are going to have to keep going to find a link between the illness we see in our children and the gas wells. It's heartbreaking but we have no alternative."

  20. A TALE OF TWO CITIES... cont...

    Meanwhile in the UK the "snake oil salesmen" are hard at it.

    Should this go ahead the wells will be in far more built up areas than in Oz.



    Forget subsidy-bloated feelgood energy, gas is the solution

    IN late June, the British Geological Survey announced the world's largest shale-gas field. The Bowland shale, which lies beneath Lancashire and Yorkshire, contains 50 per cent more gas than the combined reserves of two of the largest fields in the US, the Barnett shale and the Marcellus shale.

    Britain has been reluctant to join the hydraulic-fracturing (or fracking) revolution. Yet tapping the Bowland shale could reignite its economy and deliver huge cuts in CO2 emissions.

    At the same time, Westminster has approved stringent measures to reduce carbon emissions by 2020, with the biggest CO2 cuts by far to come from an increase of more than 800 per cent in offshore wind power over the next seven years. But offshore wind power is so expensive that it will receive at least three times the traded cost of regular electricity in subsidies, more than even solar power, which was never at an advantage in Britain. For minimal CO2 reduction, the British economy will pay dearly.

    This is just one example of current climate policy's utter remove from reality -- and not just in Britain. We are focusing on insignificant, but very costly, green policies that make us feel good, while ignoring or actively discouraging policies that would dramatically reduce emissions and make economic sense.

    Consider the three standard arguments for a green economy: climate change, energy security, and jobs. As it turns out, fracking does better on all three.

    Assuming complete success for Britain's scheme, offshore wind power could produce more than 10 per cent of the country's electricity in 2020 and cut its CO2 emissions by up to 22 million tonnes, or 5 per cent, a year. But the cost would also be phenomenal. Britain would pay at least $US8 billion ($8.8bn) annually in subsidies to support this inherently inefficient technology.

    Compare this to the opportunity of the Bowland shale. If, by 2020, Britain could exploit its reserves there at just one-third the intensity of the exploitation of the Barnett and Marcellus shales today, the outcome would be phenomenal.

    Natural gas is much more environmentally friendly than coal, which continues to be the mainstay of electricity production around the world and in Britain. Gas emits less than half the CO2 per kWh produced, and it emits much lower amounts of other pollutants, including mono-nitrogen oxides, sulfur dioxide, black carbon, carbon monoxide, mercury, and particulates. If Britain sold its shale gas both domestically and abroad to replace coal, it could reduce local air pollution significantly and reduce global carbon emissions by 170 million tonnes, or more than a third of its carbon emissions. At the same time, instead of costing $US8bn a year, shale-gas production would add about $US10bn a year to the economy. Likewise, it is often argued that the green economy will increase energy security, as green resources will leave countries less dependent on fossil-fuel imports. But even much higher supplies of wind power would improve security only marginally, because Britain would still have to import just as much oil (wind replaces mostly coal, rarely oil) and much of its gas, leaving it dependent on Russia. For countries closer to Russia's sphere, such as Poland and Ukraine, this dependence is palpable.

  21. Forget subsidy-bloated feelgood energy, gas is the solution...cont...

    And yet Britain could improve its energy security dramatically, because it has enough gas reserves to cover roughly the entirety of its gas consumption for a half-century or more. Moreover, increased British production would lower world prices, making countries with fewer or no shale-gas resources safer. And, of course, any country that is $US10bn richer, rather than $US8bn poorer, will have a better chance to handle future problems.

    Finally, green-economy advocates promise a surfeit of green jobs. But economic research convincingly shows that while subsidies can buy extra jobs, they eventually have to be financed with increased taxes, costing an equal number of jobs elsewhere.

    In comparison, shale gas in the US has created an estimated 600,000 jobs that are generating about $US100bn in added GDP and almost $US20bn in public revenue.

    Current global climate policy is unsustainable; Britain's commitment to boosting offshore wind power is only the latest example.

    Distressed economies cannot afford to pay more than $US350 to avoid each tonne of CO2, which could be cut on the European market for about 50 times less. Shale gas could cut the cost of reducing CO2 seven times more while actually helping out Europe's ailing economy.

    Though it is not the ultimate solution, shale gas is greener. With good regulation, during the coming decade it can do the most good worldwide in terms of cutting CO2 emissions and improving living conditions. Mindless subsidies that we cannot afford will not create a green economy; what will is investment in research and development to bring down costs, so that green energy eventually can out-compete gas.





      France's Hollande rules out shale gas exploration

      14 Jul 2013
      French President Francois Hollande ruled out exploration for shale gas during his presidency on Sunday, dousing hopes that a ban on hydraulic fracturing could be reviewed following a legal challenge by a U.S. firm. France's top court said this week it will examine the challenge to the ban by Schuepbach Energy, which held two exploration permits that were cancelled when the law was passed in 2011.

      Industry Minister Arnaud Montebourg stirred debate when he suggested creating a state-backed company to examine exploration techniques. But he was promptly overruled by Prime Minister Jean-Marc Ayrault. 'As long as I am president, there will be no exploration for shale gas in France,' Hollande told France 2 TV in a live interview after Bastille Day celebrations.

      The International Energy Agency has named France as a European country with some of the most plentiful underground reserves of shale gas. But Hollande's government, which comprises members of the Greens Party, has kept in place the 2011 ban and said it should remain in effect due to concerns that hydraulic fracturing can pollute underground water sources.

      Scheupbach Energy challenged the ban in the local court of Cergy-Pontoise near Paris, which forwarded the case to France's highest administrative court, which then passed it on to the Constitutional Council. 'The debate on shale gas has gone on for too long,' Hollande said.


  22. Study puts rangelands on the brink

    LOCAL scientists have detailed patterns of poverty, environmental collapse and social problems across WA’s rangelands.

    Rangelands cover nearly 90 per cent of the state and it is mostly crown-owned land leased out and used for open grazing.

    But large parts are plagued with serious economic, social and ecological issues after poor land management, such as overgrazing and lack of drought proofing, has destroyed native vegetation and degraded soil.

    Officials have so far failed to fix the problems which are impacting the livelihoods of many rangeland pastoralists.

    WA Department of Agriculture and Food officers have recently studied the key issues affecting leaseholders and grouped them into four broad ‘pattern’ areas.

    The patterns combine pastoral leases suffering combinations of economic, social or ecological problems as well as failures in all three areas.

    Study authors Rodney Safstrom and Peter-Jon Waddell say their work can now form the basis for detailing and mapping the worst affected areas and devising policy and incentives to help those in need.

    The study was published last month in CSIRO’s The Rangelands Journal.

    Mr Safstorm says detailed planning seen in urban environments is needed, but is currently lacking in the vast rangelands.

    “Large areas of severely degraded and eroded country have developed on many leases, often on what was once the most productive land,” the study states.

    “More generally, what were once the most productive perennial vegetation types are now the most degraded.

    “Western Australia’s legislative commitment to ecological sustainable rangeland management is outlined but this is not currently being achieved.”

    Mr Safstorm says his work is a theoretical look at the problem but community consultation is the next, most important, step.

    “We already have mapped quite a lot of the landscape in terms of pastoral performance,” he says.

    “We have a good idea now from various studies of the economics and we have less of an idea of the social aspects, but we know many people are adapting to the difficult circumstances by working offsite.

    “So we said why don’t we map those elements, lets see if there are common patterns that come out of that.

    “We deliberately did not try to do that [identify key problem areas] in the paper as we consider that the rangelands community should be involved in that analysis rather than coming just from people in government.”

    1. River 'worse than it looks'

      The Swan River is like a cemetery, according to world-renowned WA water expert Jorg Imberger.

      The University of WA professor makes the comparison to illustrate that not everything is as it seems.

      At face value it appears peaceful, picturesque even, but look below the surface and there is death and decay.

      "If you look at the surface, the river still looks quite good," Professor Imberger said. "It's unfortunate because it's a veneer."

      For more than 25 years, Professor Imberger and his team of scientists at UWA's Centre for Water Research have been checking the pulse of the river with increasing concern.

      Last week, they gave _The West Australian _an insight into their work as they tested the water quality from Fremantle, just before it meets the Indian Ocean, to Guildford, almost 50km upstream.

      Although the results were markedly better than those taken as recently as June, they paint a picture of a river system battling for the vital signs that indicate life, let alone healthiness.

      Oxygen levels, apart from the ocean-like environment at the river mouth in Fremantle, were modest or low, and salinity and chlorophyll concentrations - a key precursor to algal blooms - were elevated.

      Crucially, the results also underlined an entrenched and damaging phenomenon winding an increasingly tight grip around the Swan - a process known as stratification.

      Heavy seawater moves upstream, forcing fresher water flowing downstream over the top.

      The heavier water, which used to be washed out to sea every year before the big decline in Perth's winter rainfall, now effectively sits at the bottom and stagnates, allowing organic material in it to break down and consume oxygen.

      The upshot, Professor Imberger said, was that the lower depths of the Swan River could become deaths zones in which no life could survive.

      "In any other place in the world … it would be classified as a disaster," Professor Imberger said. "The problem is it's hidden here. A few dolphins come in at the surface and people think, 'Oh, it looks great, what are you talking about?' "

      The Swan River Trust concedes the river is struggling with the effects of a drying climate and urban encroachment but disputes it is dead in parts or even dying.

      River systems manager Mark Cugley points to anecdotal evidence that numbers of fish, including black bream, are abundant and populations of blue manna crabs, prawns and cobblers might be recovering.

      Mr Cugley said low oxygen levels of the kind recorded last week were "not ideal" but were not an immediate danger.

      He touches on the trust's $40 million healthy rivers action plan to describe how the agency was focused on reducing nutrients entering the river to improve its health.
      Dismissing claims of abundant fish life as "nonsense", Professor Imberger says the Swan's plight is serious and in the short term consideration should be given to a barrage under Stirling Bridge to stop intrusion of saltwater upstream.

  23. Power supply shake-up

    Hundreds of thousands of WA households could be hit with higher electricity prices under a proposed shake-up of bills aimed at recovering the massive cost to the system caused by the popularity of rooftop solar panels.

    WA's energy chiefs are understood to be pushing for a change in the structure of bills to make customers pay more in fixed charges.

    At present, most of a householder's electricity bill stems from the amount of electricity used. Fixed costs, such as the supply charge, make up about 15 per cent of the bill. However, solar panels have slashed consumption for those households, cutting revenue to State-owned power companies, including retailer Synergy and network operator Western Power.

    The trend has been highlighted as one of the big issues facing the electricity system and Energy Minister Mike Nahan has been warned that if nothing is done the consequences could be catastrophic.

    Either households without solar panels would be left to pick up the tab, forcing their bills to unaffordable levels, or electricity providers would be financially crippled.

    WA's take-up rate of photovoltaic cells - initially fuelled by generous State and Federal incentives - stands at more than 10 per cent of households and this figure is expected to double within years.

    It is believed Synergy boss Trevor James has concerns about the situation. Western Power chief Paul Italiano said last year people without PV cells paid disproportionately to maintain WA's multibillion-dollar power grid.

    Any move to increase fixed costs would be fraught for the Barnett Government, which has been under pressure over big price rises since it came to power in 2008.

    It is not known whether the Government would consider a cut in consumption charges to offset any fixed-price move or opt for a straight-out levy on householders with solar panels.

    Dr Nahan yesterday described the demand for solar panels as a "game-changer", saying it was growing at 20 per cent a year despite the withdrawal of the Government's feed-in-tariff two years ago.

    "Here in WA, the rapid growth of PVs on rooftops is having a profound influence on electricity consumption and generation," Dr Nahan said. He acknowledged the pressure it was placing on Synergy.

    "My own view is we in WA should perceive growth in small-scale PVs as a positive shift and this type of technology is here to stay," he said.

    Shadow energy minister Bill Johnston said the system's funding model was outdated and the move by householders to rooftop panels had exposed its shortcomings.
    Mr Johnston said there was a need to update the way bills were structured but he would oppose any measure that left low-income customers worse off.

  24. Coal-dust action group to take own pollution readings

    Newcastle community groups attempting to reduce coal-dust pollution along the city's main rail corridor will begin two days of monitoring on Monday after losing confidence in official environmental studies.

    The Coal Terminal Action Group, which represents 21 community organisations in the region, will monitor particle pollution blowing from coal trains as they pass through the Lower Hunter.

    The resort to ''citizen science'' follows the NSW Environmental Protection Authority's announcement earlier this month that an independent review of a report into pollution from coal trains had found a ''major error'' with the data analysis.


    That report, commissioned by the commonwealth-owned Australia Rail and Track Corporation, had angered the action group and the Greens after most of the 18 conclusions in its draft version were revised within days of the final release.


    The final version concluded that ''loaded coal trains were not associated with a statistically significant difference'' in particulate matter with a diameter of 10 micrometres or smaller when compared with concentrations when no train was passing the monitoring station.

    The action group will set up monitoring equipment similar to that used in the ARTC study over two days to calculate particulate pollution down to a micrometre in diameter at several sites near the rail corridor as loaded and unloaded coal wagons pass through Newcastle's suburbs.

    The ARTC report, with its revisions and identified flaw, had ''come out of a highly compromised process'', action group spokeswoman Fee Mozeley said. ''The community is wondering who can we trust, what can we trust?''

    The rail corridor carries about 100 laden or empty coal trains a day, a figure that would double if plans proceed to build a fourth coal export terminal at Newcastle, to about a peak of 330 million tonnes a year.



    James Whelan, chair of CTAG’s dust and health committee, said the ARTC study “was set up to justify not doing anything. It’s certainly not set up to examine the likely impact of increasing the coal trains.”

    The group, which raised the $2500 needed for the study from social media crowd-sourcing, expects to make its finding public within six weeks.

    Newcastle may eventually get a clearer view of the city’s pollution with the state government last week announcing a “particle characterisation study” following a series of alleged pollution breaches by chemicals producer Orica in 2010 and 2011.

    CTAG Ms Mozeley welcomed the study as “a step in the right direction”, adding that residents deserve a comprehensive health impact assessment with the new coal terminal likely to come before the Planning Assessment Commission in coming months.

    “This needs to be the kind of study that would not only identify current levels of air pollution as well as the related health impacts but that could also model the likely health impacts if additional pollutants are added to the mix,” she said.



    Climate change is happening too quickly for species to adapt

    A study has shown that the speed of evolutionary change is far outstripped by the rate of global warming, meaning many creatures will face extinction


    Among the many strange mantras repeated by climate change deniers is the claim that even in an overheated, climate-altered planet, animals and plants will still survive by adapting to global warming. Corals, trees, birds, mammals and butterflies are already changing to the routine reality of global warming, it is argued.

    Certainly, countless species have adapted to past climate fluctuations. However, their rate of change turns out to be painfully slow, according to a study by Professor John Wiens of the University of Arizona. Using data from 540 living species, including amphibians, reptiles, birds and mammals, Wiens and colleagues compared their rates of evolution with the rates of climate change projected for the end of this century. The results, published online in the journal Ecology Letters, show that most land animals will not be able to evolve quickly enough to adapt to the dramatically warmer climate expected by 2100. Many species face extinction, as a result.

    "We found that, on average, species usually adapt to different climatic conditions at a rate of only by about 1C per million years," Wiens explained. "But if global temperatures are going to rise by about four degrees over the next 100 years as predicted by the Intergovernmental Panel on Climate Change, that is where you get a huge difference in rates. What that suggests overall is that simply evolving to match these conditions may not be an option for many species."

    The study indicates there is simply not enough time for species to change their morphologies – for example, by altering their bodies' shapes so they hold less heat – to compensate for rising heat levels. Too many generations of evolutionary change are required. Nor is moving habitat an option for many creatures. "Consider a species living on the top of a mountain," says Wiens. "If it gets too warm or dry up there, they can't go anywhere."

    The crucial point of the study is that it stresses a fact that is often conveniently ignored by climate change deniers. It is not just the dramatic nature of the changes that lie ahead – melting icecaps, rising sea levels and soaring temperatures – but the extraordinary speed at which they are occurring. Past transformations that saw planetary temperatures soar took millions of years to occur. The one we are creating will take only a few generations to take place. Either evolution speeds up 10,000-fold, which is an unlikely occurrence, or there will be widespread extinctions.

  26. Airfield of dreams built for gas boom

    WHEN John Wagner test-fired a new corporate jet at Toowoomba airport last year, the blast caused a young bike rider to crash and smashed a window in a nearby shop.

    As a result, the airport was closed to jets and Wagner bet the family's cash fortune on a project that symbolises what the boom in coal-seam gas and mining really means for Queensland's Darling Downs region.

    Giant earthmoving equipment owned by the Wagner civil construction family partnership has been deployed to Wellcamp, a privately owned project that is replicating Brisbane airport 15km from Toowoomba's CBD.

    The project includes a 2.9km runway, compared with Brisbane's 3.3km runway, which Mr Wagner said could take Boeing 747s and heavy-lift Russian-built Antonovs "every day of the week".

    The project master plan includes a 1 million square metre industrial park, at least one 4.5-star hotel and DFO shopping mall. For the doubters, from this week, Wagner's diggers have shifted to a 24/7 roster.


    The planning application was lodged on the last day of a planning regime that did not require wide community consultation.

    Neighbour Heather Brown, whose horse stud borders the airport site, said she was concerned about how the approvals process had been run. "People would say this is wild west stuff up here," she said. At the end of the runway, Ms Brown's stud business has little future when air traffic begins.

    Mr Wagner makes no secret he "pulled every string known to man to get people to understand it is a real project", but the development was given its industrial zoning more than a decade ago and proper process had been followed.

    The Wagners had bought out several neighbouring properties to allow the project to proceed.

    Local Liberal National Party MP Ian Macfarlane said the airport was a "game-changer" for the region. "The process was there, it was followed, it was approved, so let's move on. I admire their entrepreneurship on this issue because at face value it's hard to see the volumes of passenger and freight trafficto make it economical. It's a bit like field of dreams: build it and they will come."

    Whatever the risk for the Wagners, he said, the project was all upside for Darling Downs.

  27. Residents consider CSG a threat to quality of life

    PEOPLE living near new coal-seam gas and mining projects in southwest Queensland are distressed by the perceived threat to their quality of life, according to researchers.

    While authorities have ruled out any serious health risks associated with the state's CSG boom, a paper published in Australasian Psychiatry reveals that the broader impacts are enough to damage community mental health and wellbeing.

    A team of researchers, headed by Delwar Hossain, from the University of Southern Queensland, used the paper to report on the results of 12 workshops held in affected towns in Queensland. They found locals were primarily concerned about higher living costs and increased demand for services as a result of the influx of mining workers.

    "The rural communities in this region are under sustained stress resulting from the incursion of the mining and coal-seam gas industries," the researchers said.

    The safety of the underground water supply, and land transferring from farm use to mining use, were also seen to be affecting property values, with the researchers finding that "having little control over one's destiny accompanied with financial hardship is strongly linked to the poor health of landholders".

  28. Coalition leader kicks own goal on climate


    Opposition Leader Tony Abbott's depiction of carbon trading as a whole bunch of nothing has revealed a whole bunch of something he has mostly kept hidden.

    ''Just ask yourself,'' Abbott said, his frustration bubbling to the surface, ''what an emission trading scheme is all about, it's a market, a so-called market, in the non-delivery of an invisible substance, to no one.''

    Laid bare in his comments was what many voters had suspected: that the Coalition's conversion to remedial policy was half-hearted.

    It was a reductio ad absurdum, which runs counter to the message Liberals have been pushing for years, particularly to younger voters - that climate change is real, that it is human induced, and that the conservatives are genuine about addressing it.

    Why else spend billions on ''direct action''?


    This was also Abbott's first big mistake since the advent of Kevin Rudd and the balance of power shift that his return to Prime Minister has brought.

    Laid bare in his comments was what many voters had suspected: that the Coalition's conversion to remedial policy was half-hearted and driven mainly by the search for votes.

    This is what is called in sport ''scoreboard pressure'' - the unforced errors that creep into a side when the other side starts kicking goals.

    Just four weeks ago, Abbott's universe was known. He was staring at a fixed election date of September 14, facing a deeply unpopular prime minister and riding a huge advantage in the polls - a lead of 57-43 according to the June Fairfax-Nielsen poll.

    Crippled by her method of promotion, Julia Gillard was hemmed in by the politically toxic policies she had championed, including a wildly over-promised but undelivered budget surplus, her ''no carbon tax under the government I lead'' backflip, and the continuing failure of her government's ineffectual asylum seeker response.

    Stop the boats, end the waste, repay the debt - these natty slogans had said all that many voters needed to hear as an alternative.

    Abbott was happy to oblige, as he coasted towards the highest office in the land.

    Now, all that has changed and the pressure has swung suddenly, dramatically the other way.

    Labor's late manouevres have exposed Abbott's policy cupboard as lightly stocked.

    As Rudd (mark II) moves to re-tell Labor's hamfisted economic story and neutralise its main policy failures regarding asylum seekers and the carbon ''tax'', the frustration within Team Abbott may be showing through.

    Most galling to Abbott is the possibility that Rudd could effect a half-passable escape from Labor's carbon tax nightmare.

    And who knows, with the aid of an opposition leader making his own gaffes, he just might.

  29. Abbott's climate change plan expensive even at current targets

    Alan Kohler
    From: Business Spectator

    SUDDENLY the Labor Party is politically competitive again, level-pegging with the Coalition according to the latest Nielsen poll, thanks to a tail-ender who can bat (Kevin Rudd).

    The 2013 election now may come down to policy differences rather than popularity, or the lack of it. And it seems two of the three issues that have dominated Australian politics for 15 years will once again define this election: climate change and asylum-seekers.


    Northern food bowl 'needs gas'

    NORTHERN Australia's transformation into a tropical food bowl should progress alongside a vast expansion of the underground gas industry, a leading economist has warned.

    Nathan Taylor, chief economist at the Committee for Economic Development of Australia, said proposals to lure economic investment simply with subsidies and large dams were "farcical".


    China grows by 7.5pc in second quarter, but may not meet official annual target

    CHINA'S economy grew by 7.5 per cent in the second quarter, meeting the financial markets' expectations, but fears remain that the world's fastest-growing nation will miss its official growth targets this year.

    The result was the fifth straight quarter in which the economy expanded by less than 8 per cent, the average growth rate of the past few years.

  30. As if Woodside / Chevron / Exxon didn't have enough problems re "Woodside, Exxon under pressure as US enters the fray" - their main Japanese customers will be buying a lot less LNG...

    Japan's nuclear restart to curtail gas-to-power demand

    Four of Japan's 10 main regional utilities today applied for permission to restart 10 nuclear reactors in a move set to curtail LNG imports for gas-to-power generation and reduce electricity prices.

    Kansai Electric Power, Shikoku Electric Power, Kyushu Electric Power and Hokkaido Electric Power filed an application to restart reactors under new, more stringent safety regulations imposed in the wake of the 2011 Fukushima Daiichi incident.

    Shunichi Tanaka, chairman of Japan's nuclear safety authority, forecast the safety review of each reactor could take about six month per restart.

    Following the 2011 Fukushima nuclear disaster and the subsequent shutdown of almost all of the country's nuclear power stations, natural gas made up some 65 percent of the country's energy mix.


    Japan is also the world's third largest economy, according to the UN. And nuclear power plants generate about 30 perccent of Japan's energy needs. During the shutdown of its nuclear power plants, utility companies have turned to coal, oil and gas to supply electricity to industries and households.

    Additionally, Japan is the world's largest importer of liquified natural gas (LNG) (18 percent of energy); the second largest importer of coal (22 percent) and the third largest net importer of oil (42 percent).


    Four Japan utilities apply for safety assessment of 10 nuclear reactors

    Four Japanese power utilities applied to the Nuclear Regulatory Authority on Monday to assess whether 10 of their nuclear reactors are complying with the country's new safety standards.

    The new safety standards came into effect Monday.

    The applications include Hokkaido Electric's 579 MW No. 1 reactor, 579 MW No.2 unit and 912 MW No. 3 Tomari nuclear reactor in the north; Kansai Electric's No. 3 and No. 4 Ooi reactors with a capacity of 1.18 GW each and the No. 3 and No. 4 Takahama units with a capacity of 870 MW each in the west; Shikoku Electric's 890 MW No. 3 Ikata reactor, also in the west; and Kyushu Electric's No. 1 and No. 2 Genkai reactors with a capacity of 559 MW each in the southwest.


    Kyushu Electric said that it intends to file similar applications for its No. 3 and No. 4 Genkai nuclear reactors with a capacity of 1.18 GW each on July 12.

    The application for assessment by the NRA is the first steps toward restarting the nuclear reactors, but it remains unclear how long the nuclear regulator will take to carry out the checks. It is also unclear as to who will have the final say on any decision to restart any nuclear reactor in Japan.

    Of the 50 reactors in the country, just two are currently operational -- Kansai Electric's reactors at Ooi in Fukui prefecture -- representing 2.32 GW out of a total nuclear capacity of 46.15 GW. This, in turn, accounts for 20% of Japan's total installed power generation capacity of 225.667 GW.

    Japan will lose all nuclear power generation capacity when Kansai Electric shuts the two Ooi reactors for maintenance by September 15.

    Weather and nuclear utilization rates have a direct impact on crude, fuel oil and LNG consumption for thermal power generation in Japan.

    1. Japanese LNG demand set to ease with possible restart of 10 nuclear plants

      Monday, 15 July 2013

      Japan may restart new nuclear power capacity in a couple of months, reducing the strain on its efforts to acquire additional LNG, a replacement fuel since the 2011 Fukushima disaster.

    2. The Libs new candidate for Durack Melissa Price interviewed on ABC radio this morning was asked,"do you support gas processing at James Price Point?"

      She replied that it didn't matter if she did or not Woodside weren't going to go there and she had talked to Woodside recently and they said they had entered into an agreement with Shell to use their floating technology.

      She also said she would be supporting Woodside pursue their FLNG plans and everyone should support them in that.

  31. Chevron granted access to environmental activists' email accounts

    Is oil giant Chevron trying to stifle criticism of its Ecuadorian oil drilling operations by accessing private email accounts of critics?

    Oil giant Chevron has been granted access to "more than 100 email accounts, including environmental activists, journalists, and attorneys" involved in a long-running dispute involving damage "caused by oil drilling" in Ecuador, reports the Electronic Frontier Foundation.

    Electronic Frontier Foundation (EFF) which, with EarthRights International (ERI), is opposing the New York court's decision says:

    After years of litigation, an Ecuadorian court last year imposed a judgment of over $17 billion on Chevron for dumping toxic waste into Amazon waterways and causing massive harm to the rainforest. Instead of paying, Chevron sued more than 50 people who were involved in the Ecuador lawsuit, claiming they were part of a conspiracy to defraud the oil giant. None of the individuals represented by EFF and ERI has been sued by Chevron or accused of wrongdoing.

    Both EFF and ERI have warned that Chevron's subpoenas will have a "chilling effect" on people who would speak out against the oil company's activities in Ecuador and elsewhere.

    The background to the case was reported by Common Dreams staff writer Lauren McCauley:

    The oil giant is demanding the records in an attempt to cull together a lawsuit which alleges that the company was the victim of a conspiracy in the $18.2 billion judgment against it for dumping 18.5 billion gallons of oil waste in the Ecuadorean Amazon, causing untold damage to the rainforest.

    EarthRights International has also raised concerns that the presiding judge, Lewis Kaplan, who has been "accused of prejudice against Ecuadorians and their lawyers" made some sweeping and startling arguments in this case:

    Kaplan's decision upheld Chevron's sweeping subpoena with an argument that is as breathtaking as the subpoena itself. According to Judge Kaplan, none of the accountholders could benefit from First Amendment protections since the accountholders had "not shown that they were U.S. citizens."

    Now, let's break this down. The account-holders in this case were proceeding anonymously, which the First Amendment permits. Because of this, Judge Kaplan was provided with no information about the account holders' residency or places of birth. It is somewhat amazing then, that Judge Kaplan assumed that the account holders were not US citizens. As far as I know, a judge has never before made this assumption when presented with a First Amendment claim. We have to ask then: on what basis did Judge Kaplan reach out and make this assumption?

    Regardless of what you think of the USA's first amendment rights, this case has some exceptionally worrying ramifications for people who oppose the environmental destruction caused by multinational oil corporations.

    Chevron is one of the "rogue" fossil fuel companies named by global climate activist Bill McKibben in his Rolling Stone article, Do The Math, whose reserves, if burned, amount to a carbon bomb:

    According to the Carbon Tracker report, if Exxon burns its current reserves, it would use up more than seven percent of the available atmospheric space between us and the risk of two degrees. BP is just behind, followed by the Russian firm Gazprom, then Chevron, ConocoPhillips and Shell, each of which would fill between three and four percent. Taken together, just these six firms, of the 200 listed in the Carbon Tracker report, would use up more than a quarter of the remaining two-degree budget.

    In Australia, environmental groups and individual conservationists were targeted with SLAPP suits (strategic lawsuit against public participation), aimed at destroying community opposition to damaging developments.

  32. Sea levels may rise 2.3 metres per degree of global warming, report says

    Seas will remain high for centuries after temperatures have risen, with the likelihood of more frequent and damaging storms

    Sea levels could rise by 2.3 metres for each degree Celsius that global temperatures increase and they will remain high for centuries to come, according to a new study by the leading climate research institute, released on Monday.

    Anders Levermann said his study for the Potsdam Institute for Climate Impact Research was the first to examine evidence from climate history and combine it with computer simulations of contributing factors to long-term sea-level increases: thermal expansion of oceans, the melting of mountain glaciers and the melting of the Greenland and Antarctic ice sheets.

    Scientists say global warming is responsible for the melting ice and heat-trapping gases from burning fossil fuels are nudging up temperatures. "We're confident that our estimate is robust because of the combination of physics and data that we used," Levermann told Reuters. "We think we've set a benchmark for how much sea levels will rise along with temperature increases."

    Sea levels rose by 17cm last century and the rate has accelerated to more than 3mm a year, according to the IPCC. A third of the current rise is from Antarctica and Greenland.

    Almost 200 governments have agreed to limit global warming to less than 2C above pre-industrial times and plan to agree, by the end of 2015, a deal to curb emissions.

    Global average surface temperatures have risen by 0.8C (1.4F) since the industrial revolution and the IPCC has said temperatures are likely to be 0.4 to 1.0C warmer from 2016-35 than in the two decades to 2005.

    "In the past there was some uncertainty and people haven't known by how much," Levermann said. "We're saying now, taking everything we know, that we've got a robust estimate of 2.3 meters of rising sea per degree of warming."

    Some scientific studies have projected sea level rise of up to 2 metres by 2100, a figure that would swamp large tracts of land from Bangladesh to Florida.

    David Vaughan, head of the Ice2sea project to narrow down uncertainties about how melting ice will swell the oceans, has said sea levels would rise by between 16.5 and 69 cm under a scenario of moderate global warming this century.

    Vaughan told Reuters the biggest impact rising seas will have is that storms will be more destructive in the near future.

    "It's not about chasing people up the beach or the changing shape of coastlines," he said. "The big issue is how the storms will damage our coasts and how often they occur. That'll increase even with small levels of sea rise in coming decades."

    "Continuous sea-level rise is something we cannot avoid unless global temperatures go down again," Levermann said. "Our results indicate that major adaptation at our coastlines will be necessary. It's likely that some currently populated regions can't be protected in the long run."



  33. Shale Skeptics Take On Pickens as Gas Fuels Policies

    Where others see a U.S. energy revolution of cheap and abundant fuel, David Hughes sees a short-term bubble that will bring higher economic and environmental costs.

    The Canadian geoscientist, founder of the consulting company Global Sustainability Research, is part of a movement pushing back against conventional wisdom that the U.S. is on the verge of energy independence amid surging oil output and a 100-year supply of natural gas. Projections of 2,384 trillion cubic feet of gas supplies provide false confidence because they don’t adequately account for the cost of production declines of as much as 47 percent a year that come with drilling in shale, Hughes said.


    While President Barack Obama endorses the use of more gas as a power-plant fuel and the U.S. considers expanding exports to exploit the current glut, shale skeptics such as Hughes and Bill Powers, a director of Calgary-based energy producer Arsenal Energy Inc (AEI)., warn that consumers and industry will feel the pain of rising prices when supplies fall short of estimates they say are based on a mistaken belief that the torrid growth seen in the past five years will continue.

    “Human nature doesn’t change, and we extrapolate recent trends far into the future even if those trends are woefully unsustainable,” said Powers, author of “Cold, Hungry and in the Dark: Exploding the Natural Gas Supply Myth.” Advances in shale-gas technology won’t continue forever, he said, “and we’re probably seeing them reach their maximum potential as far as production growth goes.”

    Fast Fade

    Wells drilled into the hard rock of shale produce a burst of oil and gas after being hydraulically fractured -- a technique that cracks the rock to release hydrocarbons. The flow rapidly diminishes as gas must migrate farther through the rock to reach the fracturing site where it can enter the well. To counter the declines, companies drill more wells, longer wells and intensify the fracking process, all of which can raise costs.

    About $42 billion must be spent every year just to offset decline rates in shale gas wells that generated revenue of about $33 billion in 2012, Hughes estimated in a report earlier this year for the Post Carbon Institute, which advocates options for a more sustainable world. Proceeds from higher-priced petroleum liquids contained in the most lucrative wells have helped offset the deficit for now, though the industry faces higher costs from increasingly uneconomic wells as the best prospects are exhausted, he said.

    Wrong Assumptions

    To Hughes, cheap gas and abundant gas are “mutually exclusive” in the long term. Instead of providing a reason to accelerate fossil fuel use, new supplies of crude and gas from shale fields just give the U.S. more time to develop alternative energy solutions, he said.

    According to Arthur Berman, a Houston-area geologist and director of Labyrinth Consulting Services, basing U.S. policy on what he sees as overly optimistic supply and low-price projections is foolish.

    Shale production mushroomed in the past decade as producers expanded the use of horizontal drilling and fracking to wrest oil and gas from previously impermeable rock. Gas output in the U.S. climbed 25 percent from 2007 to a record last year, according to U.S. Energy Information Administration data.

    In April, the Potential Gas Committee, which issues a biennial report with support from the Colorado School of Mines, said the U.S. had a technically recoverable resource base of 2,384 trillion cubic feet of gas at the end of 2012, while other estimates claim the resource can last 100 years, the committee said on its website.

  34. Shale Skeptics Take On Pickens as Gas Fuels Policies


    Decade Low

    The surge in supplies pushed prices down to a decade low last year below $2 per million British thermal units -- a price that only added to gas’s appeal as consumers and industry switched to the cheaper fuel to save money.

    T. Boone Pickens, the billionaire who advocates a plan to replace imported oil with domestic gas, says it should become the preferred fuel in vehicles. At the same time, the continental U.S. may see as many as six gas export projects built, sending as much as 10 billion cubic feet a day by the end of 2022, the head of Freeport LNG Development LP said in an interview last month.

    Decline rates cited by the skeptics already have been incorporated into many supply estimates, said Erica Bowman, chief economist at America’s Natural Gas Alliance, an industry group whose members include Chesapeake Energy Corp. (CHK), Apache Corp. (APA) and Devon Energy Corp. (DVN)

    Affordable Prices


    Skepticism about shale’s potential was raised as early as 2009, when Berman drew rebukes from Chesapeake and Devon for his work questioning the projections for shale gas as overly optimistic. Berman, who was among the first to point out the steep declines in production after a well is drilled, continues to sound the warning bell for policy makers about what he sees as unrealistic estimates.

    “They’ve got sugar-plum fairies dancing in their heads about this infinite supply and how much money we’re going to make and the net for the U.S. economy,” Berman said in a July 2 phone interview.

    Decline Rates

    Wells drilled before 2012 in the top U.S. shale gas areas indicate an average field decline of 37 percent a year, according to data compiled by Hughes. That includes 47 percent in the Haynesville Shale in Louisiana and 29 percent in Pennsylvania’s Marcellus Shale.

    Gas prices rose this year to more than $4 per million Btu before subsiding to a current level of about $3.60. As lower-quality wells raise the cost of production and tighten supplies, gas may rise to $6.50 in 2018 and to $8 or more in 2022, with spikes into double-digit prices possible within five years, Hughes says. Powers, the author, also said gas prices may surge into the double digits in the future.


    Gas remains far from parity with oil on an energy-equivalent basis, Pickens said, which would require gas prices of about $16 per million Btu when oil is $100 a barrel.

    “I’ll never see $16 natural gas in my lifetime,” Pickens, 85, who scoffs at the pessimism of skeptics, said in a July 12 interview.

    Cheap Production

    ICF International, an industry consultant, estimated in a report that the U.S. and Canada have 1,500 trillion cubic feet of gas that can be developed at a cost of $5 or less per million Btu. That includes about 800 trillion cubic feet of shale gas, ICF said.


    The country’s gas resource “is not endless, but it’s pretty dang big,” Pursell said, and it can be counted on for decades. He said the government should stay out of the way and let the market work.

    Daily U.S. gas output is forecast to be 70 billion cubic feet in 2013 and 70.4 billion cubic feet next year, compared with 69.2 billion in 2012, according to a July 9 outlook from the EIA.


    1. "Cheap Production

      ICF International, an industry consultant, estimated in a report that the U.S. and Canada have 1,500 trillion cubic feet of gas that can be developed at a cost of $5 or less per million Btu. That includes about 800 trillion cubic feet of shale gas, ICF said."

      THE WORDS BURU AND NEW STANDARD WOULD NOT LIKE AT ALL...."....developed at a cost of $5 or less per million Btu."

      Buru and others have said they could make money at around $8 - $9 mbtu from the Canning but most likely that was from "ideal" well conditions and did not include the usual mishaps.

      Interesting because Barnett's plan for JPP - gas plant + value adding - would need gas at around $4 - $6 mbtu for the Ammonia/Alumina companies to be profitable which makes me wonder how Alcoa will go once the gas has been piped all the way south of Perth.


      "A financial model for shale gas should therefore be probabilistic in nature at the individual well level,but aggregate the well gas flows over the field to give a probabilistic range in gas prices required for the overall investment to be financially viable."


      Depending on the rate of decline and the need for more and more well drilling and fracking it could be that the shale gas from the Canning Basin wouldn't make a worthwhile profit until the dom gas price hit around $11 - $12 mbtu.(not far off what it costs to land a shipload into Tokyo Bay.)

      IT SEEMS very likely the gas will always be too expensive to compete on the world LNG market - at least well into the future.

      And WA domgas prices are unlikely to reach a high enough level for about 20 - 30 years.

      And by then the cost of manpower and all else could have risen enough to prevent even that.

  35. Controversial Tas mine rejected in court

    Environmentalists have won a legal bid to overturn approval of a controversial mine in Tasmania's Tarkine region.

    Save the Tarkine last year challenged then environment minster Tony Burke's decision to allow Shree Minerals to develop an iron ore mine near Nelson Bay River, in the state's northwest.

    The Federal Court on Wednesday overturned the approval.
    Save the Tarkine argued Mr Burke failed to take due consideration of the effect of the development on the local Tasmanian devil population.

  36. If this is the case and the premier is going to change his mind then the CA for JPP is a waste of time and taxpayers money.The word around town is that Woodside are leaving Broome and there will be no supply base at JPP and possibly we have missed out at the wharf too.Can anyone else confirm this?

    Gray backs Browse offshore push

    18 Jul, 8:12 AM
    Resources and Energy

    Federal Resources Minister Gary Gray has backed a push by Woodside Ltd's Browse Basin gas project to process the liquefied natural gas offshore, The Australian Financial Review reports.

    "My interest as the Commonwealth Minister for Resources has to be in the Kimberley coast’s interests, WA interests and also the national interests, and we must ensure the development of that resource in a timely fashion," Mr Gray told the newspaper.

    Western Australian premier Colin Barnett has previously stated his opposition to the change, preferring an onshore processing facility.

    According to the AFR, Mr Gray said he understood Mr Barnett's opposition, but indicated he thought THE PREMIER WOULD CHANGE HIS MIND.

  37. Environmentalists appeal NSW coal mines

    Environmentalists will appeal in the federal court against plans for two Whitehaven Coal mines in northwest NSW, claiming they will "rip the heart out" of the farming industry.

    Whitehaven received approvals from the federal government in February to begin construction at the Maules Creek coal mine, near Narrabri, and the neighbouring Idemitsu Boggabri coal mine.

    The Northern Inland Council for the Environment announced on Friday it would challenge the approvals because of the "dodgy process by which they were approved and the devastating impacts they will have".

    "The decision to approve these highly controversial mines was made in haste, after documents were leaked and on the basis of potentially false or misleading information," the group's spokesman Phil Spark said.

    "The mines together will clear almost 1500 hectares of the Box-Gum critically endangered ecosystem - one of the most threatened ecosystems in Australia.

    "Vast areas of forest that provides habitat for native plants and animals, including the koala, will be bulldozed and converted into an open-cut coal pit.

    Peter Watson, whose farm adjoins the mines, said the proposals would have a devastating impact on his business.

    "If these mines proceed, they will rip the heart out of our local farming community of Maules Creek," he said.

    "The mines will lead to a major drop in our groundwater and will dump dangerous coal dust on our farms and families."

    Pepe Clarke, CEO of the Nature Conservation Council of NSW, said there had been serious failures in the environmental approval processes.

    "These mines should never have been approved, and local residents should not be forced to resort to court action to ensure that our federal environmental laws are applied properly."

    He said the federal government approved the mines without properly assessing the offset areas proposed as compensation for destroying thousands of hectares of publicly-owned native forest.

    Mr Clarke also questioned how the project could proceed when an investigation was still under way into whether Whitehaven had provided false or misleading information to obtain approval.
    Comment has been sought from Whitehaven.

  38. Looking at some of Burkes deeply flawed decisions you would have to wonder just how much this means.

    Federal Labor keeps final say on environmental approvals

    The Federal Government says it has no plans to give the states greater control over the environmental approvals process.

    That puts it at odds with big business, which has been pushing for a major overhaul of a system it says is costing projects and jobs, particularly in mining.

    Under the current system, resource projects that may affect areas of national significance need to secure State, then Federal, environmental approval.

    It's often criticised as 'green tape', and industry says it's an unwieldy, lengthy and costly system that's holding up investment.

    Business and governments had been negotiating a more streamlined process to give states governments the final say.

    But on the campaign trail in Queensland yesterday, Federal Environment Minister Mark Butler made it clear that's no longer on the table.

    He says the Federal Government will retain the power of veto over projects if it doesn't consider them environmentally sound.

    "We were more than open to discuss ways that we could streamline the assessment processes for business and environmental stakeholders.

    "But at the end of the day, the Commonwealth still has legal obligations to ensure the protection of matters of national environmental significance."

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