Friday, February 7, 2014

Draft regulations that impact shale and tight gas exploration

The public comment period to the 118-page draft regulations, titled Petroleum and Geothermal Energy Resources (Resource Management and Administration) Regulations 2014, closes on May 30.

Buru Energy aims to start a fraccing campaign in four Canning Basin wells starting in April.

Natural Gas From Shale and Tight Rocks - An Overview of Western Australia Regulatory Framework by redhanded8937


  1. 'Fracking' inquiry begins first round of public hearings

    ...........The inquiry has attracted more than 100 submissions.

    "So we can flesh out those public submissions and really get down to the nitty-gritty of whether or not hydraulic fracturing as proposed in Western Australia is going to be a good thing for [the] West Australian community, economy and environment or whether we need to make sure there needs to be further safeguards that we need to recommend to government," he said.

    "We want to make sure that we address potential fears and concerns that people have and establish the veracity of those concerns.

    "We certainly need to take on board some of the important considerations that were raised by the Department of Health, by the Department of Water and the Public Health Association.

    "We also need to listen closely to what industry has to say."

    Meanwhile, a number of organisations will present evidence to the inquiry, including the nation's peak body for the oil and gas industry.

    The Conservation Council of WA will be the first to present its evidence during the public hearings, followed by the Department of Water and the Australian Petroleum Production and Exploration Association.

    Hearings are listed to be held until February 17.


    WA Water Department tells inquiry it has no veto over shale gas fracking

    Western Australia's Department of Water has told a state parliamentary inquiry it has no veto over fracking for natural gas below proclaimed groundwater areas such as reservoirs.

    But it says it would advise authorities against the approval of shale gas fracking underneath a public drinking water source.

    The Water Department made the admission on the first day of the inquiry in the implications of hydraulic fracking, the fracturing of hard rock to release natural gas. Tad Bagdon, executive director of policy and innovation at the department, told the parliamentary committee there was the potential for conflict over protection of water supplies and expanding the gas industry.

    But he said his department was working closely with other agencies including the WA Department of Mines and the Environment Protection Agency "to ensure approval processes have the appropriate level of assessment."

    The Conservation Council of Western Australia told the inquiry that new draft regulations to control shale gas fracking are not tough enough.

    The council's director, Piers Verstegen, says he does not have much confidence in the new rules.

    "We've looked at the draft regulations pretty closely and what they actually say is they require industry best practice.

    "What we know from other parts of the world is industry best practice means contaminated ground water, serious air pollution, health impacts on communities and serious environmental disturbance, so we don't think industry best practice is going to be acceptable here for Western Australia," he said.

    Mr Verstegen said the council estimated there could be 100,000 wells drilled in the Kimberley in the north of the state when commercial shale gas production gets underway based on well density in the US.

    But he said the figure may be out by "50 per cent".

    12 shale gas fracking wells expected to be drilled this year

    The peak body for the oil and gas industry, the Australian Petroleum Production and Exploration Association, said it expected 12 wells for shale gas fracking to be drilled in WA this year.

    1. Stedman Ellis strikes again!


      Danger to water seen in fracking

      WA's water regulator says there could be future "conflict" if the gas exploration technique known as fracking encroaches on water sources set aside for drinking.

      The Department of Water yesterday appeared before a State Parliamentary inquiry into the implications of fracking in WA, conceding it had concerns about the technology.

      Executive director of policy Tad Bagdon said there were three main areas of "interest".

      They were the chemicals used, whether the wells had suitable integrity and what happened to the millions of litres of water and chemicals pumped underground.


      It involves drilling wells vertically and horizontally that often intersect with aquifers.


      However, he acknowledged there was potential for conflict if fracking proposals encroached on public water sources and the department had concerns about where the two interacted.

      The Conservation Council of WA said fracking was environmentally damaging and it was particularly worried about wells failing.

      Director Piers Verstegen said evidence from the US suggested fracking wells failed at a rate between 6 per cent and 7 per cent, invariably acting as a "pathway" for water contamination and air pollution.

      He also said there was an alarming lack of baseline data for areas likely to be subjected to fracking, meaning it would be impossible to know if it caused bad environmental outcomes.

      Stedman Ellis, from the Australian Petroleum Production and Exploration Association, dismissed the claims as hyperbole, insisting wells almost never failed and fracking was safe.

      "There is no evidence of contamination from fracking of water in any jurisdiction around the world," Mr Ellis said.


      So this is like the defence tobacco companies used to wriggle out of paying damages to smokers who had cancer.

      Strange because there are thousands of Oil and Gas Industry papers and studies that deal with well failures and pollution etc.

      "The cigarette companies, through their public admissions and courtroom arguments, seem to be saying, “Yes, smoking causes lung cancer, but not in people who sue us”.

      Just like Stedman Ellis saying yes there are problems when reading industry reports -
      BUT saying NO there are no problems when reading environment group reports.

      Say What? Actual Big Tobacco quotes

      ""So are potatoes. Cancer-causing that is. Tobacco is in the same family. You inhale the fumes of potatoes when you're cooking them"
      (R Berryman, Tobacco Institute, Australia, 1989)"

      ""Let's face it. We are interested in evidence which we believe denies the allegations that cigarette smoking causes disease"
      (Philip Morris, 1970)"

      ""Set aside in the minds of millions the false conviction that cigarette smoking causes lung cancer and other diseases; a conviction based on fanatical assumptions, fallacious rumours, unsupported claims and the unscientific statements and conjectures of publicity-seeking opportunists"
      (Glantz SA, Slade J, Bero LA, Hanauer P., Barnes DE (eds). The Cigarette Papers. Berkley. University of California Press 1996)"

      ""Virtually every household has products that could be hazardous to children, like cleaning supplies, medicines, health and beauty products, and you compare that to 20 to 25 percent of households that use tobacco products...well, where is the real danger?"
      (David Howard, a Reynolds spokesman, on Camel Orbs. / Flavored Tobacco Pellets Are Denounced as a Lure to Young Users / New York Times, Monday, April 19, 2010)"

      ""It's also a well known fact that teenagers like sweet products. Honey, for example, might be considered [as an additive]"
      (B&W 1972, from John Schwartz, Documents Indicate Strategy of Targeting Teen Smokers, Washington Post, February 5, 1998)"

    2. Of the 5 quotes above from big tobacco BURU have used all of them at one time or another in defence of fracking.


      "The argument against smoking is statistical. No research anywhere in the world over the past thirty years has shown how diseases claimed to be associated with cigarette smoking are caused... There is no proof of causation of even one single death from cigarette smoking", Tobacco Institute of Australia Limited, 28 July 1983 (4).

      "Nobody denies that there is a statistical argument for a relationship between smoking and ill health, but so long as a casual relationship between the two cannot be established, it is arguable whether it is in the public interest to confuse the issue either by inference or by intent", A.A. Wood, Public Affairs, Rothmans of Pall Mall (Australia) Limited, 18 October 1983 (5).

      "No there's no proof that it [smoking] has any effect [on disease], we just don't know the answers... there is no hard cold scientific proof that will stand up in any community", David Butcher, Philip Morris (Australia) Limited, February 1984 (6).

      Interviewer : " you agree with warning number one, smoking causes lung cancer?

      "Certainly not", John Dollisson, Chief Executive, Tobacco Institute of Australia Limited.
      "Do not agree", William Webb, Managing Director, Philip Morris (Australia) Limited.

      Interviewer : "Smoking causes heart disease?"

      "Certainly not", John Dollisson.
      "Do not agree", William Webb.

      Interviewer : "Smoking reduces your life expectancy?"

      "Certainly not", John Dollisson.
      "Do not agree", William Webb.

      Interviewer : "Giving up smoking improves you health?"

      "Do not agree", William Webb 25 April 1985 (7).


      "... the industry believes that there is no evidence to substantiate that it [nicotine] is addictive", Phil Scanlon, Manager of Corporate Relations and Public Affairs, Amatil (W.D. & H.O. Wills), 18 June 1984 (19).

      "Cigarettes are not an addictive drug. They are a habit like chewing gum", Peter McAdam, Manager, Corporate Affairs, Philip Morris (Australia) Limited, 9 July 1987 (20).

      "... tobacco is not addictive in the strict sense", Tony McAdam, Philip Morris (Australia) Limited, 27 April 1988 (21).

      "I don't think smoking is addictive", Donna Staunton, Tobacco Institute of Australia Limited, August 1994 (22).


      Evidence now indicates that senior scientists and executives within the cigarette industry knew about the cancer risks of smoking as early as the 1940s35 and were aware that smoking could cause lung cancer by the mid 1950s.36 By 1961, cigarette companies had access to dozens of published scientific studies warning that cigarette smoking and chemical agents found in tobacco smoke might cause cancer.37 Despite growing knowledge of the serious health risks associated with cigarette smoking, cigarette companies continued to reassure smokers that their products were safe. In January 1954, Philip Morris, RJ Reynolds, Brown & Williamson, Lorillard, and American Tobacco jointly placed an advertisement entitled “A Frank Statement to Cigarette Smokers” which appeared in 448 newspapers in 258 cities, reaching an estimated 43 245 000 people.7, 38 The “Frank Statement” advertisement questioned research findings implicating smoking as a cause of cancer, promised consumers that their cigarettes were safe, and pledged to support impartial research to investigate allegations that smoking was harmful to human health. This paper examines the extent to which cigarette companies fulfilled the promises made to consumers in the 1954 “Frank Statement” advertisement and the effect of these promises on consumer knowledge, beliefs, and smoking practices.


      The six American cigarette companies alone, annually spend more than $4 billion for advertising. Successfully selling poison that causes disease and death requires all of the tricks of big business; aggressive advertising, legal action to silence critics, donations to ensure the support of politicians and manipulating scientific evidence to confuse consumers. The stakes are high; for the industry, billions and billions of dollars profit, and for the customers, premature death.

      Tobacco contains over 4,000 different gases, particles and compounds including tar, nicotine and carbon monoxide. Tobacco smoke "tar" is composed of several thousand chemicals that can damage lung tissue and cause several diseases. Some of these chemicals include: acids, alcohol's, aldehydes, ketones, aromatic hydrocarbons and corrosive gases such as cyanide and nitrogen oxide.

      The average age for first use of tobacco is 12 years. Although smoking continues to drop among all major age, race and sex groups, teenage smoking has not declined. In fact, the smoking rate for teenage girls has risen over the past few years. This trend is perhaps due to the increasing number of advertising campaigns directed towards the young.

      Smoking causes about 30% of all cancers, including cancer of the lungs, mouth, pharynx, oesophagus, bladder and pancreas. It is also a major cause of heart disease, emphysema and chronic bronchitis. Pregnant women who smoke have higher rates of miscarriage, still birth, premature birth and complications of pregnancy. More of their babies die soon after birth than the new borne of non-smoking mothers.


      Health issue irrelevant, tobacco firms tell court

      Date March 13, 2012

      Big tobacco companies have told the High Court they ''deny the content'' of documents lodged by the federal government making the case that smoking causes lung cancer.


      .............Mutations in the p53 gene are found in more than half of all human tumors, including 60 percent of lung cancers. Damage to the gene leads to the uncontrolled proliferation of cells that is the hallmark of cancer.

      The carcinogen benzo[a]pyrene was first identified in cigarette smoke in 1952. In the 1990s, exposure to benzo[a]pyrene was shown to cause changes in the p53 gene. In 1996, researchers showed that benzo[a]pyrene's interaction with p53 mirrored mutations found in human lung tumors, a discovery that provided molecular evidence of how cigarettes cause cancer.


      Don't Be Fooled Again: A Report on the Tobacco Industry's Lies and Deceptions

      "Now, I want to be very clear. We do not survey anyone under the age of 18."-- James Johnston, CEO of R.J. Reynolds Tobacco, in testimony before the House Energy and Commerce Subcommittee on Health and the Environment, April 14, 1994

      Just one year prior to its domestic launch of the domestic Joe Camel Campaign, RJR, through its Canadian Subsidiary, commissioned a study on 15-17 year-olds. -- A R.J. Reynolds Tobacco report "Youth Target 1987", 1987.


      "We do not market to children." -- James Johnston, CEO of R.J. Reynolds Tobacco, in testimony before the House Energy and Commerce Subcommittee on Health and the Environment, April 14, 1994.

      "Evidence is now available to indicate that the 14-to-18 year old group is an increasing segment of the smoking population. RJR-T must soon establish a successful new brand in this market if our position in the industry is to be maintained over the long term." -- March 15, 1976, document stamped "secret" and entitled Planned Assumptions and Forecast for the period 1977-1986 for R.J. Reynolds Tobacco.




      'NUFF SAID.

  2. Buru ships first oil from Wyndham

    UPDATE 1.20pm: Shares in Buru Energy were up strongly as the company heralded the first shipment of crude oil from its Ungani project in Kimberley's Canning Basin through the port of Wyndham.

    "In accordance with the term of the sale and purchase agreement, the shipment has been sold and is currently in transit to a refinery in South East Asia," the company said in a statement.

    Managing director Dr Keiran Wulff described it as a significant milestone in the establishment of a market for Ungani oil.

    He said it set a strong foundation for the ongoing export of crude oil from Wyndham.

    The Ungani project is a conventional oilfield which is a 50/50 joint venture between Buru and Japan's Mitsubishi Corporation.

    Buru also holds several other unconventional oil and gas assets in the Canning Basin.

    Shares in the company closed up 16 cents, or 8.94 per cent, at $1.95.


    The following alert has been issued by the Department of Fire and Emergency Services (DFES). - See more at:

    .................IF DRIVING:

    People should avoid driving unless it is necessary

    Slow down, turn your lights on and keep a safe distance from other drivers

    If it is raining heavily and you cannot see, pull over and park with your hazard lights on until the rain clears

    Take care in areas that have been flooded and do not drive into water of unknown depth and current

    Be careful driving on gravel roads as surfaces will be slippery and muddy, and vehicles could become bogged.


    A number of roads have been closed due to flooding including:

    Victoria Highway between the Northern Territory border and the Great Northern Highway

    The Great Northern Highway between Warmun and Wyndham


    As at 4:29am the Bureau of Meteorology advises bad weather will continue north east of a line from Drysdale River to Argyle over the next 24 hours. This includes people in, near or between Kununurra and Wyndham.

    A tropical low lies to the west of Kununurra and is expected to drift slowly to the west during Saturday

    The low is likely to cause heavy rainfall that may lead to flash flooding.

    There is also the risk of damaging winds to 100 kilometres per hour that could cause damage to homes and property.


    Yes wouldn't want a road train of crude washed into Lake Argyle....................or anywhere else.
    Hope they know what they are doing.

  3. Buru Provides Update on Drilling at Ungani 3 Well in EP 391 in WA

    by Buru Energy Ltd.

    Press Release
    Thursday, February 06, 2014- See more at: http://www.rigzone.

    Buru Energy Limited, an Australian oil and gas exploration and production firm, provided Thursday the following weekly update on drilling operations at the Ungani 3 well in exploration permit (EP) 391 in Western Australia as at 06:00hrs, Feb. 6 (AWST).

    The Ungani 3 well is currently drilling ahead at 6,952 feet (2,119 meters) measured depth (MD) in 12.25 inch hole, progress for the week is 324 feet (99 meters).

    The slow progress was related to a bit change and conditioning the hole. The forward operation is to continue to drill ahead to tag the top of the Ungani Dolomite at which point the 9.625 inch casing will be set prior to drilling through the Ungani Dolomite primary objective.

    Ungani 3 is the first well in the Buru – Mitsubishi Corporation (MC) 2014 drilling program. Buru and MC each have a 50 percent equity and contributing interest in the well and the Ungani Field.

    The Ungani 3 well is located in production application STP-PRA-0004 in exploration permit EP 391 some 62 miles (100 kilometers) to the east of Broome.

    The well location is some fifty kilometres from the Great Northern Highway along the Ungani access road.

    The well has a programmed total depth of 7,677 feet (2,340 meters) and is expected to take some 35 days to drill and suspend.

    Further Reports In accordance with its policy of releasing weekly drilling progress reports, the Company will issue drilling progress reports each week, subject to any material events occurring in the meantime.

    From next week, the drilling report will be issued on Tuesday of each week.

  4. Woodside firms up deal for Leviathan gas field off Israel

    Woodside Petroleum will enter a non-binding Memorandum of Understand (MoU) to take a 25 per cent stake in the massive Leviathan gas field off Israel as it seeks to diversify away from Australia.

    The company has been negotiating for more than a year with US-based Noble Energy and Israeli-based Delek Group, Avner Oil Exploration and Ratio Oil.

    It will pay an initial amount of $US850 million with $US350 million due when the final investment decision is made.

    Woodside had previously signed an Memorandum of Understanding for a 30 per cent stake for $US1.5 billion.

    The Leviathan field is Israel's largest gas discovery of late and is estimated to hold 19 trillion cubic feet of gas and 34 million barrels of condensate.

    It is most likely to be developed using floating offshore technology such as that proposed for the Browse Basin off Western Australia's Kimberley coast.


    but warmer weather than usual predicted!

    US Henry Hub price of close to $8 shows Japan and others US LNG price economics

    Friday, 07 February 2014

    The Henry Hub spot natural gas price in Erath, Louisiana, which is so beloved of those seeking less expensive LNG cargoes, has just hit its highest level since September 2008 at $7.90 per million British thermal units.


    Canadian LNG projects face investment delays as they await decision on taxes

    Thursday, 06 February 2014

    LNG developers in Canada will likely delay their final investment decisions this year after the British Columbia Finance Minister said tax measures for the province's 10 planned LNG export projects are not expected to be finalized until the end of the year.

    1. Panama Canal upgrade remains at standstill amid $1.6 bn cash gap

      ................Bankers financing the 3.2 billion contract (2.3 billion euros) to expand the canal visited the worksite on Friday.

      The project is designed to widen the canal so that massive cargo ships can pass through. It is one of the world's most ambitious biggest civil engineering projects and was due to be completed next year.

      The builders have said completion may be delayed by up to five years.

      The consortium has accused the Panama Canal Authority of breaking off negotiations. It says the authority failed in obligations to pay a $50 million bill and to help pay workers and subcontractors.

      GUPC had offered to split the cost of finishing the dig with the Canal Authority and then let arbitrators decide who pays for the overrun.

      The Panamanians suggest a deal could be reached if the builders commit to specific dates for stages of the job to be ready. There would also be a ban on further cost overruns.

      The GUPC claims unforseen geological difficulties have forced them to spend much more on cement than expected. They say that they based their estimates on data provided by the Canal Authority that was incorrect.

      The consortium of builders includes Italy's Impreglio, Jan de Nul from Belgium, and Panama's Constructora Urbana.

      The original canal, built by the United States mostly with workers brought in from the Caribbean, was completed in 1914.

      It offers a shortcut and safer journey for maritime traffic, is used by 13,000-14,000 ships each year, handling five percent of world sea trade.

      The canal generates $960 million a year for Panama, nearly 10 percent of the country's total annual income

  5. Fears as pulp mill bid run by ex-Gunns man falls flat

    The Australian |
    February 08, 2014 12:00AM

    AN overseas company pulled out of bidding for Gunns's Tasmanian pulp mill assets, prompting industry fears the plantation feedstock will be wood-chipped or fed to a basic "brown pulp" plant.

    The Weekend Australian has learned that former Gunns chief executive Greg L'Estrange organised a bid with a major foreign pulp player hoping to build the $2.5 (billion) mill essentially as planned by the failed timber firm.

    The bid was withdrawn after the first round, with the company deciding the task was too complex and costly compared to Asian and Latin American opportunities.

    While Gunns receiver KordaMentha insists two bidders remain interested in bidding for the mill permit, industry sources believe the L'Estrange bid was the only one capable of building the world-scale bleached eucalypt kraft mill "any time soon".

    They now expect the Gunns assets to be sold to financial investors or a private equity firm, which would woodchip and export the plantations while searching for a pulp mill backer before the permit expires in 2017.

    This would mean ongoing uncertainty for the Tamar Valley, where opinion on the project is divided among those hoping for jobs and those concerned about pollution and impacts on local food, tourism and wine industries.

    One timber industry source said a Chinese company was interested in building a "brown pulp" mill, involving the simple extraction of water from the wood before it was shipped to China for final processing and bleaching.

    There was also concern that surviving bidders were unwilling to fund the cost of replanting and regrowing the 90,000ha of Gunns plantations, intending to instead harvest them only once.

    This would mean downstream timber processing would be short-lived unless the government agreed to fund the replanting and managing of the plantations.

    Mr L'Estrange said yesterday he was unable to comment on whether he had been involved in organising a bid or related issues.

    Industry sources said the L'Estrange-organised bid was the only serious interest from a party capable of building the world-scale pulp mill planned by Gunns and committing to multiple plantation rotations.

    They said the pulp-mill permit was now expected to be sold very cheaply because the buyer would have to assume the project may not get off the ground and that the plantations would be exported as lower-value woodchips.

    Even so, sources said the buyer would be able to use the three-year period before the mill permit expired to find a backer for the project and hope that market conditions, including the high Australian dollar, improved.

    State Greens forestry spokesman Kim Booth said using public subsidies to replant plantations to feed a wood-chipper or pulp mill would amount to "corruption".

    Industry sources said whoever purchased the permit would not be in a position to secure financing to build the $2 billion-plus project unless they found a far larger wood supply.

    They said the plantations for sale via KordaMentha would supply less than half the 4.5 million tonnes of wood needed for the pulp mill each year.

    A KordaMentha spokesman said six second-round bidders were undertaking due diligence for all or some of the assets.