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Fri, 2014-06-20 10:25Steve Horn
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Heather Zichal, Former Obama Energy Aide, Named to Board of Fracked Gas Exports Giant Cheniere

Heather Zichal, former Obama White House Deputy Assistant to the President for Energy and Climate Change, may soon walk out of the government-industry revolving door to become a member of the board of directors for fracked gas exports giant Cheniere, who nominated her to serve on the board. 

The announcement, made through Cheniere's U.S. Securities and Exchange Commission Form 8-K and its Schedule 14A, comes just as a major class-action lawsuit was filed against the board of the company by stockholders.

In reaction to the lawsuit, Cheniere has delayed its annual meeting. At that meeting, the company's stockholders will vote on the Zichal nomination.

The class-action lawsuit was filed by plaintiff and stockholder James B. Jones, who alleges the board gave stock awards to CEO Charif Souki in defiance of both a stockholders' vote and the company's by-laws. 

Souki — a central character in Gregory Zuckerman's book “The Frackers“ — became the highest paid CEO in the U.S. as a result of the maneuver, raking in $142 million in 2013, $133 million of which came from stock awards.

Cheniere CEO Charif Souki; Photo Credit: Getty Images

Zichal was nominated to join Cheniere's audit committee of the board, and will be paid $180,000 per year for the gig if elected.

Among the audit committee duties: “Prepare and review the audit committee report for inclusion in the proxy statement for the company's annual meeting of stockholders,” which is now set for September 11 after the push-back following the filing of the stockholder class-action lawsuit.

“The audit committee’s responsibility is oversight, and it recognizes that the company’s management is responsible for preparing the company’s financial statements and complying with applicable laws and regulations,” Cheniere's audit committee charter further explains.

Thu, 2014-06-19 09:57Steve Horn
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Silent Coup: How Enbridge is Quietly Cloning the Keystone XL Tar Sands Pipeline

While the debate over the TransCanada Keystone XL tar sands pipeline has raged on for over half a decade, pipeline giant Enbridge has quietly cloned its own Keystone XL in the U.S and Canada. 

It comes in the form of the combination of Enbridge's Alberta Clipper (Line 67), Flanagan South and Seaway Twin pipelines.

The pipeline system does what Keystone XL and the Keystone Pipeline System at large is designed to do: ship hundreds of thousands of barrels per day of Alberta's tar sands diluted bitumen (“dilbit”) to both Gulf Coast refineries in Port Arthur, Texas, and the global export market.

Alberta Clipper and Line 67 expansion

Alberta Clipper was approved by President Barack Obama and the U.S. State Department (legally required because it is a border-crossing pipeline like Keystone XL) in August 2009 during congressional recess. Clipper runs from Alberta to Superior, Wis.

Map Credit: U.S. Department of State

Initially slated to carry 450,000 barrels per day of dilbit to market, Enbridge now seeks an expansion permit from the State Department to carry up to 570,000 barrels per day, with a designed capacity of 800,000 barrels per day. It has dubbed the expansion Line 67.

As reported on previously by DeSmogBlog, Line 67 is the key connecter pipeline to Line 6A, which feeds into the BP Whiting refinery located near Chicago, Ill., in Whiting, Ind. BP Whiting — the largest in-land refinery in the U.S. — was recently retooled to refine larger amounts of tar sands under the Whiting Refinery Modernization Project.

Tue, 2014-06-03 18:00Steve Horn
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Days Before Obama Announced CO2 Rule, Exxon Awarded Gulf of Mexico Oil Leases

On Friday May 30, just a few days before the U.S. Environmental Protection Agency announced details of its carbon rule proposal, the Obama Administration awarded offshore oil leases to ExxonMobil in an area of the Gulf of Mexico potentially containing over 172 million barrels of oil.

The U.S. Department of Interior's (DOI) Bureau of Ocean Energy Management (BOEM) proclaimed in a May 30 press release that the ExxonMobil offshore oil lease is part of “President Obama’s all-of-the-above energy strategy to continue to expand safe and responsible domestic energy production.” 

Secretary of Interior Sally Jewell formerly worked as a petroleum engineer for Mobil, purchased as a wholly-owned subsidiary by Exxon in 1998.

Dubbed a “Private Empire” by investigative reporter Steve Coll, ExxonMobil will now have access to oil and gas in the Alaminos Canyon Area, located 170 miles east of Port Isabel, Texas. Port Isabel borders spring break and tourist hot spot South Padre Island.


Map Credit: U.S. Bureau of Ocean Energy Management

ExxonMobil originally won the three leases at the Western Planning Area Sale 233, held on March 19. BOEM records show ExxonMobil was the only company to participate in the bid and paid over $21.3 million.

Tue, 2014-06-03 13:15Julie Dermansky
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Questions Raised About Integrity of Keystone XL's Southern Route After Conditions Added for Northern Leg

The Keystone XL pipeline's southern route passes under Eleanor Fairchild's Texas property, so she got angry when she learned that the Pipeline and Hazardous Materials Safety Administration (PHMSA) has added two new conditions to the 57 already required for construction of the pipeline's northern route.

“My fears were confirmed,” Fairchild told DeSmogBlog. “The regulators knew the southern route wasn’t built safely. It is like they have said to hell with us in Texas and Oklahoma.”


Eleanor Fairchild was defiant when TransCanada started installing the pipeline on her land. She kept a watchful eye during the installation and repair of the pipeline. ©2012 Julie Dermansky

Julia Trigg Crawford, another Texas landowner who fought TransCanada in the courts, shared a link to an Associated Press story that focuses on the two new conditions. “Read this ASAP to see why Texans and Oklahomans were so outraged about TransCanada's abysmal construction record on the southern leg of the Keystone XL,” she wrote.

Julia Trigg Crawford
Julia Trigg Crawford was labeled an activist by TransCanada attorney James Freemand. She considers herself a patriot for standing up for all Americans' property rights. ©2013 Julie Dermansky

The conditions require TransCanada to hire a third-party contractor chosen by PHMSA to monitor the construction and make reports to the U.S. government on whether the work is sound. Additionally, TransCanada must “develop and implement a quality management system that would apply to the construction of the entire Keystone XL project in the U.S. to ensure that this pipeline is — from the beginning — built to the highest standards by both Keystone personnel and its many contractors.”

The Tar Sands Blockade, an activist group that independently monitored the pipeline installation after failing to stop it, wrote on its blog that the new conditions suggest there are serious problems with the southern route.

“TransCanada’s internal quality management and PHMSA’s external inspection program were inadequate, if not fatally flawed. The failures implied by these new conditions beg the question: If TransCanada wasn’t adequately inspecting its own work, and PHMSA didn’t have the third-party inspection company it needed for effective oversight, was anyone actually watching TransCanada?”

Wed, 2014-05-07 05:55Julie Dermansky
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Residents Deliver Petition to Ban Fracking to City Hall in Denton, Texas

A petition to ban hydraulic fracturing, or “fracking,” in Denton, Texas, is being submitted to City Hall today, paving the way for Denton to become the first city in Texas to prohibit the controversial method of extracting natural gas.

Members of the Denton Drilling Awareness Group, who are pushing for a ballot initiative, collected more than 1,871 signatures in support of a fracking ban within Denton city limits — three times more than were required and just 300 shy of the number of ballots cast in the last municipal election.

Once the signatures are certified, the city council will have to vote on the proposed ban. If council adopts a ban, fracking will be illegal inside Denton's city limits. If council votes against the ban, the initiative will likely be on the ballot in November, giving the public a chance to vote on the matter.

We hope the council will vote to approve the ban,” said Ed Soph, a member of the Denton Awareness Group. “But at a minimum, we hope they’ll respect their constituents and allow the Denton residents a chance to vote on the ban, not try to block it on a legal technicality.”

Mon, 2014-05-05 10:33Steve Horn
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For First Time, TransCanada Says Tar Sands Flowing to Gulf in Keystone XL South

TransCanada admitted for the first time that tar sands oil is now flowing through Keystone XL's southern leg, now rebranded the Gulf Coast Pipeline Project. The company confirmed the pipeline activity in its 2014 quarter one earnings call.

Asked by Argus Media reporter Iris Kuo how much of the current 300,000 to 400,000 barrels per day* of oil flowing from the Cushing, Oklahoma to Port Arthur, Texas pipeline is tar sands (“heavy crude,” in industry lingo), TransCanada CEO Russ Girling confirmed what many had already suspected.

“I don’t have that exact mix, but it does have the ability to take the domestic lights as well as any heavies that find a way down to the Cushing market, so it is a combination of the heavies and the lights,” said Girling. “I just don’t know what the percentage is.”

The Keystone Pipeline System — of which Keystone XL's northern leg is phase four of four phases — is and always has been slated to carry Alberta's tar sands to targeted markets. So the announcement is far from a shocker.


Image Credit: Wikimedia Commons

More perplexing is why it took so long for the company to tell the public that tar sands oil now flows through the half of the pipeline approved via a March 2012 Executive Order by President Barack Obama

Wed, 2014-04-30 21:55Steve Horn
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Explosive Virginia Train Carried Fracked Bakken Oil, Headed to Potential Export Facility

Platts confirmed CSX Corporation's train that exploded in Lynchburg, Virginia was carrying sweet crude obtained via hydraulic fracturing (“fracking”) in North Dakota's Bakken Shale basin. CSX CEO Michael Ward has also confirmed this to Bloomberg.

“Trade sources said the train was carrying Bakken crude from North Dakota and was headed to Plains All American's terminal in Yorktown,” Platts explained. “The Yorktown facility can unload 130,000 b/d of crude and is located on the site of Plains oil product terminal.”

In January, the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration issued a Safety Alert concluding Bakken crude is more flammable than heavier oils. Hence the term “bomb trains.”

At least 50,000 gallons of the oil headed to Yorktown is now missing, according to ABC 13 in Lynchburg. Some of it has spilled into the James River, as previously reported on DeSmogBlog.

A map available on CSX's website displaying the routes for its crude-by-rail trains offers a clear indication of where the train was headed.


Map Credit: CSX Corporation

Formerly a refinery owned by Standard Oil and then BP/Amoco, Plains All American has turned the Yorktown refinery into a mega holding facility. 

Yorktown may become a key future site for crude oil exports if the ban on exports of oil produced domestically in the U.S. is lifted. 

Tue, 2014-04-29 13:14Steve Horn
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TransCanada Charitable Fund Launches Keystone XL "Good Neighbor" Charm Offensive

TransCanada has taken a page out of former U.S. President Franklin Delano Roosevelt's playbook and deployed a public relations “charm offensive” in Texas, home of the southern leg of its Keystone XL tar sands pipeline now known as the Gulf Coast Pipeline Project.

In the 1930s and 1940s, Roosevelt utilized a “good neighbor policy“ — conceptualized today as “soft power” by U.S. foreign policy practitioners — to curry favor in Latin America and win over its public. Recently, TransCanada announced it would do something similar in Texas with its newly formed TransCanada Charitable Fund.

TransCanada has pledged $125,000 to 18 Texas counties over the next four years, funds it channeled through the East Texas Communities Foundation. In February, the company announced the first non-profit recipients of its initial $50,000 grant cycle.  

“The fund is designed to help improve East Texas communities and the lives of their residents through grants to qualifying non-profit organizations in the counties where TransCanada pipeline operations and projects exist,” explained a press release. “All funded projects and programs fall within three charitable categories: community, safety, and the environment.”

TransCanada utilizes the “good neighbor” language in deploying its own public relations pitch.

“At TransCanada, being a good neighbor and contributing to communities is an integral part of our success,” TransCanada's Corey Goulet said in a press release. “The establishment of the fund is another example of our commitment to long-term community investment and our dedication to the people of East Texas.”

Thu, 2014-04-17 05:00Sharon Kelly
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After Over a Decade of Fracking, Oversight of Industry's Radioactive Waste Still Lacking

It has been roughly twelve years since fracking launched the great shale rush in the U.S. and the biggest problem with the technology — how to safely dispose of the enormous quantities of toxic waste generated — remains unsolved.

In particular, regulators have struggled to fully understand or police the hazards posed by radioactivity found in fracking waste.

The most common form of radioactivity in shale waste comes from radium-226, which happens also to be an isotope that takes the longest to decay. To be exact, radium-226’s half-life of roughly 1,600 years means that well over a millennium and a half from now, more than half of the radium that fracking brings to the surface today will still be emitting dangerous radioactive particles.

Concern about the waste has taken on renewed urgency in light of a detailed report published in Environmental Health Perspectives (EHP), a peer-reviewed scientific journal which is backed by the National Institutes of Health. The study concluded that worrisome and extensive gaps in federal and state oversight of this radioactivity problem still persist.

At the federal level, radioactive oil and gas waste is exempt from nearly all the regulatory processes the general public might expect would govern it,” the researchers wrote. “State laws are a patchwork.’”

This is not an entirely new finding. Several years ago, a New York Times investigative piece highlighted how the oil and gas industry routinely dumped radium-laced waste water into rivers. State regulators in Pennsylvania and the oil and gas industry adamantly denied there was a problem.

So what's changed? The recent academic study concludes that even several years later, worrisome oversight lapses remain. As such, the researchers wrote, there is continuing reason for concern.

We are troubled by people drinking water that [could potentially have] radium-226 in it,” David Brown, a public health toxicologist with the Southwest Pennsylvania Environmental Health Project, told the researchers (insert in original). “When somebody calls us and says ‘is it safe to drink our water,’ the answer is ‘I don’t know.’”

Wed, 2014-02-12 05:00Steve Horn
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Documents Reveal Calvert County Signed Non-Disclosure Agreement with Company Proposing Cove Point LNG Terminal

Co-authored by Steve Horn and Caroline Selle

DeSmogBlog has obtained documents revealing that the government of Calvert County, MD, signed a non-disclosure agreement on August 21, 2012, with Dominion Resources — the company proposing the Cove Point Liquefied Natural Gas (LNG) export terminal in Lusby, MD.  The documents have raised concerns about transparency between the local government and its citizens.

The proposal would send gas obtained via hydraulic fracturing (“fracking”) from the Marcellus Shale basin to the global market. The export terminal is opposed by the Chesapeake Climate Action Network, Maryland Sierra Club and a number of other local environment and community groups.

The Accokeek Mattawoman Piscataway Creeks Council (AMP Council), an environmental group based in Accokeek, MD, obtained the documents under Maryland's Public Information Act and provided them to DeSmogBlog.

Cornell University’s Law School explains a non-disclosure agreement is a “legally binding contract in which a person or business promises to treat specific information as a trade secret and not disclose it to others without proper authorization.”

Upon learning about the agreement, Fred Tutman, CEO of Patuxent Riverkeeper — a group opposed to the LNG project — told DeSmogBlog he believes Calvert County officials are working “in partnership with Dominion to the detriment of citizen transparency.”

We’re unhappy that it does seem to protect Dominion's interest rather than the public interest,” Tutman said. “The secrecy surrounding this deal has made it virtually impossible for anyone exterior to those deals, like citizens, to evaluate whether these are good transactions or bad transactions on their behalf.”

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