-

On Thursday, the White House and International Energy Agency announced a joint effort is under way to release 60 million barrels of oil into the global market to offset rising energy costs. Over the next 30 days, the United States and other partners within the agency will release these reserves to offset disruptions in global oil supply caused by the recent social and economic turmoil occurring throughout the Middle East.

In support of this effort, the Obama administration plans to contribute 30 million barrels of oil to be withdrawn from the U.S. Strategic Petroleum Reserve. The White House’s decision comes at an interesting time as oil prices have begun to wane as a result of recent gains in the U.S. dollar and declining projections of global economic growth.

The reserve was established to provide relief in case of any temporary disruption in oil supply, like natural disasters, hurricanes or a blockade of oil imports from other nations. Essentially, our strategic stockpile serves as a safety net for our nation in times of emergency. It is important to be responsible and particular about any decision to utilize these reserves.

The administration’s decision to tap our strategic stockpile is purely political in nature, will only serve as a short-term response and simply ignores the implications of our country’s failed energy policies.

To put it into perspective, the 30 million barrels of oil the United States plans to contribute is the equivalent to 75 days of oil production we are projected to lose in the Gulf of Mexico as a result of the federal drilling moratorium and the government’s inability to permit ongoing and future projects in that region.

So why release our oil now? It’s fairly simple. It’s campaign season.

The underlying fact is the U.S. economy is recovering at a slower pace than expected. And the Obama administration and feds are running out of solutions to fix the dwindling economic situation. With the 2012 presidential election under way, the hottest issue for candidates will be the economy and efforts to alleviate pain at the gas pumps. Dumping a significant amount of oil into the open market will give short-term relief on projected oil prices and might just buy some time leading up to the November election.

Unfortunately, a policy decision of this nature will not fix the economy; nor will it have an impact on the future global energy crisis we face. The reality is the global oil markets are driven simply by supply and demand.

The only way we can climb out of the economic issues we face and drive energy prices down long term is to incentivize American companies to explore and produce our natural resources here at home.

Don Briggs is president of the Louisiana Oil and Gas Association.

Original Article

-

By ALAN SAYRE

NEW ORLEANS

Despite some headwinds hitting the national economy, Louisiana’s job growth picked up slightly in May.

The Louisiana Workforce Commission said Wednesday that the state recorded 15,000 non-farm jobs more last month than in May 2010, including a jump of 10,200 from April. The numbers are not adjusted for seasonal factors.

The April-to-April comparison showed a gain of 14,500 jobs, while the March-to-March gain was 9,200 jobs.

In a continuation of a recent trend, the private sector provided all of the growth, adding 31,800 jobs over 12 months. Government employment at all levels dropped 16,800 jobs.

Among the metropolitan areas, New Orleans had the largest number of new jobs over the year, with 4,900, followed by Shreveport-Bossier City with 4,800. The 12-month laggards included Baton Rouge, Monroe and Lafayette.

Workforce Commission executive director Curt Eysink said Louisiana — on a non-seasonally adjusted basis — has added jobs in eight out of the past 10 months. He blamed a slight increase in the jobless rate on a typical seasonal pattern occurring when school personnel and students enter the work force.

On a seasonally adjusted basis, Louisiana’s unemployment rate for May was 8.2 percent, up from 8.1 percent in April.

Year-to-year increases were recorded in all sectors of goods-producing employment: 800 additional jobs in mining, most of which consists of the petroleum industry; 1,250 additional construction jobs and a boost of 4,200 manufacturing jobs.

In the service-providing sector, private education and health services gained the most jobs over the past 12 months, with 9,300, followed by hospitality with 8,200 and trade, transportation and utilities with 4,900.

Economist Loren Scott, who follows Louisiana’s employment trends, said “it’s hard not to be happy with these numbers. There’s virtually no sector, other than government, that isn’t growing.”

The gain in manufacturing came despite a 1,000-job drop in shipbuilding payrolls. Scott said that is largely attributable to the phasing-out of the Huntington-Ingalls shipyard at Avondale, which is slated for closure in 2013. Several other major shipbuilder in Louisiana have been hiring new workers, he said.

Scott noted that the Louisiana chemical industry has added at least 700 jobs over the past 12 months, which he said is the combination of low U.S. natural gas prices and a weak dollar that encourage exports.

Of the government jobs lost over the past 12 months, 8,000 were in the federal sector where temporary Census workers have been laid off, Scott said. State government is down by 2,500 jobs over the year, while local governments have cut 6,300.

Among the state’s metropolitan areas:

– New Orleans job overall gain from May 2010 to May 2011 consisted of 5,400 more service-providing jobs and a reduction of 500 workers in goods-producing sectors.

– Baton Rouge dropped 900 jobs in the May-to-May comparison. Goods-producing jobs increased by 400, but the service-providing sector shed 1,300.

– Houma-Thibodaux gained 2,400 jobs over the year, including 700 goods-producing jobs and 1,400 in the service-oriented sector.

– Lafayette wound up with a yearly loss of 100 jobs because of a 400-job gain in the goods-producing sector and a 500-job loss in the service-providing sector.

– Lake Charles gained 1,900 jobs from May 2010 to May 2011. The service-providing sector increased by 2,100 jobs, while the goods-producing sector los 200.

– Shreveport-Bossier City’s overall gain over 12 months came from 2,600 additional goods-producing jobs and 2,200 more jobs in the service-providing sector.

– Alexandria gained 1,400 jobs over 12 months, including 300 in the goods-producing sector and 1,100 in the service-providing sector.

– Monroe shed 900 jobs over 12 months. Although the goods-producing sector increased by 200 jobs, the service-providing sector lost 500.

Original Article

Reserve Estimation for Unconventional Resources

http://reserve-estimation.com/

Tuesday, August 23 – Wednesday, August 24, 2011

Houston, Texas

Featured Speakers

Ian McDonald (Conference Chair)Internal Qualified Reserves Evaluator Nexen

Paul LupardusDirector Corporate Reserves Chesapeake Energy

Kurt SteffenExploration Geologist ExxonMobil

David FulfordSenior Reservoir Engineer, Planning and Reserves Devon Energy

About

Are you confident that your reserves estimations reflect the volume of the reserves in your unconventional reservoirs?

As unconventional resources become increasingly commercially viable, the challenges associated with estimating reserves only continue to increase. Unfamiliar geology, a lack of historical data to work with, and doubt surrounding the applicability of the Arp’s Decline Curve Model present serious challenges when trying to calculate reserves estimates.

Reserves Estimation for Unconventional Resources, to be held in Houston on 23rd and 24th August, is a chance for you to get the latest technical knowledge on the best ways to overcome these challenges. This meeting will also cover the complexities of the classification system, and issues such as migrating from a probable to a proved reserve. Examine the SEC regulations and how to comply with them, as well as the most up-to-date technological and theoretical advances in the field, such as techniques for efficient reservoir simulation, classifying PUD locations and long-term production forecasting.

A highly technical agenda, a crucially important topic and a line-up of fantastic speakers makes this meeting one that those who work in this field cannot miss.

Why attend?

* Assess the applicability of decline curve analysis and make an informed decision on the numerical versus the empirical model

* Explore more appropriate decline models and semi-analytical forecasting methods with Dr. John Lee

* Review SEC regulations, and the most effective ways for compliance and eliminating confusion around the classification system

* Weigh up probabilistic and deterministic methods and examine the evidence for yourself

* Understand how microseismics can increase the accuracy of your reserves estimations and examine the complex geology of unconventional reservoirs

* Examine the effectiveness of the methods available to help you estimate your reserves, such as reservoir simulation, pressure analysis methods, and use of analog data

REGISTER HERE

http://reserve-estimation.com/register

-

BATON ROUGE — The $25 billion state operating budget is on its way to Gov. Bobby Jindal’s desk after the Louisiana House gave its final approval Tuesday, wrapping up the Legislature’s biggest order of business with two days remaining in the session.

The House agreed unanimously to adopt the version crafted by the Senate, which restored about $200 million in cuts to health care, public safety and other programs. The vote on House Bill 1 ends months of wrangling over how best to plug holes in the budget created by the end of the federal stimulus program and rising state health-care costs.

Although the House and Senate made wholesale changes to the executive budget presented by Jindal in March, the final product appears to meet the administration’s bottom-line goal of avoiding deep cuts to higher education and health care.

“It’s amazing what happens down here when you can communicate and work together, and I think you will see that today,” said Rep. Jim Fannin, D-Jonesboro, who authored the bill.

Jindal had proposed balancing the budget with money generated from the sale of state prisons, a state employee payroll tax increase and a shift of tobacco-settlement dollars. But the House removed that money, and then cut another $93 million to comply with a new procedural rule that limits the amount of one-time revenue that can be spent on recurring expenses.

Instead of using tobacco-settlement money to finance TOPS scholarships, the House used money from an economic-development “mega fund.”

But the Senate found ways to restore most of the House cuts by using federal hurricane-recovery dollars and raiding various state funds.

The move brought bipartisan praise from House members, many of whom had opposed the prison sales and criticized Jindal for using “contingencies” to balance the budget.

“In summation, there are not contingent dollars in the budget. No smoke and mirrors, that sort of stuff,” said Rep. John Bel Edwards, D-Amite, the House Democratic leader.

Still, the budget bill will reduce the state’s workforce by about 3,500 positions, and reduces spending in most state agencies. It forces most state employees to go without a pay raise for the second year in a row after year of near-automatic pay hikes, and requires agencies to absorb inflationary costs such as rising pension payments.

The House also gave lopsided approval to several companion budget bills, also by Fannin, that are needed to make the budget work: House Bill 477, which shifts money between various state funds; and House Bill 611, which appropriates money in the current fiscal year.

Original Article

-

Leesville, La. —

In a move that foreshadows increased activity by oil and gas companies in Vernon Parish, the Vernon Parish Police Jury voted unanimously Monday to pass an ordinance revision to require permits for pipeline crossings, dredging and oil, gas and mineral exploration and production to require driveways leading to and from oil and gas well sites to be paved.

The jury passed the ordinance revision unanimously after a public hearing during which representatives from two separate drilling companies as well as a representative from the Louisiana Oil and Gas Association spoke to those gathered.

“We don’t want to do any fighting, only drilling,” said J.P. Hesterly, a representative of Anadarko E & P Company LP, which has already been permitted, a process which takes about a year, on five wells in the parish, all of which are located in the Burr Ferry South field. Two of those wells are actively producing gas, while two others are active injection wells and the fifth was permitted on March 7.

“We’re excited that oil and gas industry is looking in our area,” said James Tuck, district one representative and president of the police jury. “We do want to work with you all any way we can.”

At the same time, Tuck said, it was important to assure the people of the parish that the roads will be protected.

This is not the first ordinance revision in recent months. In April, the jury voted to change an ordinance to require oil and gas companies using parish roads for heavy hauling to surface the roads to certain specifications determined by the parish road supervisor.

The intent of both changes is to prevent damage to roads. Parish Road Manager Carl Thompson and Secretary/Tresurer Rhonda Plummer have both been communicating with northern parishes already dealing with an influx of oil and gas exploration. It is not uncommon for the oil and gas industry to haul loads as heavy as 200,000 pounds 24 hours a day, 7 days a week, said Thompson.

Earlier in the year, Indigo Mineral, an oil company that had begun drilling in district 6, paid to replace rock on Hood Camp Road.

Danny Baker, a representative of Indigo, was also at the meeting.

“I think we went a little above and beyond, I’ll be honest with you,” he said concerning the work on Hood Camp Road that Indigo had facilitated. Baker said that the action was evidence that his company has the community’s best interest at heart.

The ordinance revision passed in Monday’s meeting will require companies to provide a 10 foot apron and 90 feet of compacted stone to protect the edges of parish roads and to keep dust down, said Tuck.

Baker said that Indigo wants to maintain a good relationship with the parish and the community.

Jodee Bruyninckx, of Louisiana Oil & Gas Association, who represents Haynesville Shale drillers, acknowledged that roads are big a concern for parishes faced with drilling activity. She offered her help and guidance in facilitating good relationships between the parish and drillers, not only in the present, but in the future.

Fifty to 70 natural gas wells are expected to be drilled in the near future to access natural gas in the Burr Ferry areas, according to a landman who spoke only on condition of anonymity. At least three wells have already been drilled within the last year to access natural gas which lies in the Austin Chalk, a formation that sweeps through Texas, Central Louisiana and Mississippi.

In fact, the Vernon Parish Clerk of Courts has been deluged lately with oil and gas landmen and abstractors researching deeds and acreage in western Vernon Parish, especially the Burr Ferry, Knight and Evans communities.

Swift Energy Operating LLC also has two active wells in the Burr Ferry South field, though they were permitted earlier. The same company has nine actively producing wells in the Master’s Creek field, which is also a part of the Austin Chalk and also partially located in Vernon Parish.

The Master’s Creek field has adjacent southern corners in Vernon Parish and Rapides Parish with a slight overlap into Allen Parish. The Master’s Creek field has been producing since the 1990’s.

Original Article

-

The most prolific marine ecosystem on earth is being systematically destroyed on orders of the U.S. Dept. of the Interior. Where the BP oil spill failed miserably, Obama’s Dept. of the Interior now triumphs.

First came the “moratorium” on Gulf drilling. “That’s kicking a man when he’s already down,” said former offshore oil worker (and current country music superstar) Trace Adkins last May in an interview with CNN. The Obama administration itself admits to 8-12,000 job losses in Louisiana from the moratorium. But Louisiana now has 25,000 more unemployed than before the moratorium, which continues de-facto in the form of stonewalling and lollygagging on issuing new drilling permits. So that “man” is still down and reeling from Federal kicks.

Another kick came last September in the form of a Federal “Notice to Lessees.” “As part of our sustained effort to improve the safety of energy production on the Outer Continental Shelf and strengthen environmental protections,” decreed U.S. Dept. of Interior Sec. Ken Salazar last September 15th, “We are notifying offshore operators of their legal responsibility to decommission and dismantle their facilities when production is completed.”

Dismantling their production platforms could cost oil operators”$6 billion to $18 billion in lost future production,” according to a report by Mark Kaiser and Allan Pulsipher of the Louisiana State University Center for Energy Studies.

“Boo-hoo-hoo” say some Feds. “Yawwwwn” say others. “Production?” “costs?” “profits?”—come on! Where’s the Federal “Environmental Expert” affected by such stuff!

So let’s try this: the most prolific and “diverse marine ecosystem” ever recorded by marine scientists was created by the “facilities” the U.S. Dept. of the Interior is hell-bent on dismantling (offshore oil platforms.) Acting as artificial reefs over the past half century, the natural beauty, teeming fish life, coral colonies, and “bio-diversity”, created by these structures is amply documented in several studies commissioned by none other than: the U.S. Dept. of the Interior!

One recent report by the Bureau of Ocean Energy Management Minerals (a division of the U.S. Dept. of the Interior) boasts that: ”fish densities are 20 to 50 times higher at oil and gas platforms than in nearby Gulf water, and each platform seasonally serves as critical habitat for 10 to 20 thousand fishes.”

In fact, villainous “Big Oil” produces marine life at rates to shame “wondrous” Earth Goddess Gaia “The fish Biomass around an offshore oil platform is ten times greater per unit area than for natural coral reefs,” found Dr. Charles Wilson of LSU’s Dept. of Oceanography and Coastal Science. “Ten to thirty thousand adult fish live around an oil production platform in area half the size of a football field,” For proof click on this video.

An LSU study found that 75 per cent of all offshore fishing trips in Louisiana target these fish- teeming “reefs.” Recreational fishing and diving trips to these “reefs” generate an estimated 5,560 full time jobs and $324 million annually for Louisiana. But Salazar’s decree now forces oil producers to plug 3,500 nonproducing wells and dismantle about 650 platforms by 2020. These represent 800 acres of critical Marine habitat. 80 per cent of these oil production “facilities,” btw, are owned by independent producers rather than “Big Oil,” as in Exxon or BP.

The Feds mandated this dismantling and plugging from the days the very first platforms went up over half a century ago. But production from these wells wasn’t a simple matter of letting it gush until the oil ran out. “Many wells fall idle when extracting the oil becomes unprofitable at a certain price,” explains Don Briggs, President of the Louisiana Oil & Gas Association: “plugging wells and tearing down platforms will ultimately lead to the loss of oil from idled wells that would become attractive for further production down the road as the price of energy rises, but not if the companies have to rebuild the infrastructure to tap it.”

“SEE!—SEE!” shriek the greenies. “Big Oil finds—then HIDES all that oil from us—waiting to GOUGE us with even HIGHER gas prices!” Others call it the law of supply and demand. And if it’s “not nice to fool mother mature” history shows it’s even more catastrophic to try and fool markets. Point is, historically, Federal rules proved elastic, even by Federal standards. A modus vivendi had existed where platforms remained standing and wells unplugged until “one year after the lease (by the oil producer from the Feds) expired,” rather than until “production stopped.”

No longer. The Obama Team has cracked the whip. “We have placed the (Oil) industry on notice that they will be held to the highest standards of planning and operations in developing leases,” stressed Sec. Ken Salazar.

Accidently drop your boat anchor over coral off the Florida coast and you’ll be fined up to $25,000 pursuant to Federal Regulations. Catch and keep a Gag Grouper, Amberjack or more than 2 Red Snapper per fishing trip in any U.S. Federal waters and you’ll be fined $600 per fish, pursuant to Federal regulations.

Yet endangered coral in the Gulf of Mexico is being blown up, blow-torched, and winched out of the Gulf by the ton to bleach in scrapyards—as mandated by Federal Regulations. Tons of Red Snapper, Grouper, Amberjack and thousands of other “endangered” or “threatened” fish species are being dynamited in the Gulf of Mexico and left as Shark-chum—as mandated by the same Federal Regulations. Most of these “facilities,” you see, are “dismantled” with explosives detonated around its legs below the Gulf floor. Behold the usual collateral damage here.

“It smells like death here,” said Texas fishing caption Brent Casey about a Gulf coast scrapyard piled with sections of dismantled oil platforms. “I wish you could see these 75-foot piles of metal covered in coral. It’s just insane. Forty years of habitat—gone.”

Not exactly “gone.” After the production of “endangered” fish stops and the “endangered” coral is sandblasted off, the habitat is mostly sold as scrap metal to China, as reported by Davis Sikes of the The Corpus Christi Caller-Times.

So where’s the Greenies on this, you ask?

They’re with the despoilers. “This (Dept of Interior decree) is an important first step in cleaning up what’s become a dumping ground for the offshore oil and gas industry,” said Peter Galvin, of the Center for Biological Diversity. Galvin’s Center, by the way, bemoans the fate of the earth’s coral reefs in particular, and filed a petition with the Feds to place 83 species of corals (including several that thrive on those very offshore oil platforms) on the Endangered Species list. “The world’s corals and coral reef ecosystems—these rainforests of the sea—are in crisis,” wails the Center for Biological Diversity. “In just a few decades all their rich biodiversity could disappear completely.”

“Global Warming,” needless to add, is the culprit according to the Center for Biological Diversity.

The Marine habitat responsible for this proliferation of (so-called) endangered species from Coral to Gag Grouper is human-made, you see. And as PETA chieftain Ingrid Newkirk observed: “Humans are the biggest blight on the face of the earth!” Earth Goddess Gaia certainly helped the proliferation of marine life in the Gulf of Mexico—but only by piggy-backing on habitat erected by this infernal “blight” known as man. Worse still, this amazing marine habitat was created by the Snideley Whiplash/Darth Vader of Greenie nightmares: Oil companies.

Original Article

-

BATON ROUGE — State lawmakers are battling over a plan that could result in the eventual phasing out of $2.4 billion in state personal income taxes.

But how to do it is the big question.

State Sen. Rob Marionneaux, D-Livonia, the author of Senate Bill 259, wants to do it by making some cuts and replacing part of the lost revenue by lifting some of the almost $7 billion in tax exemptions and credits that the Legislature has granted over the years.

Those exemptions range from a movie production credit that has made Louisiana the third top site for making movies and a huge break for natural gas drilling in the Haynesville Shale region to small things such as waiving sales taxes for councils on aging.

A Department of Revenue chart shows the state surrendered almost $7.1 billion in possible tax collections last year and is expected to bypass collecting another $7 billion next year.

And with about $50 million in tax exemptions making their way through the legislative process in this session, the amount is climbing.

Rep. Hunter Greene, R-Baton Rouge, who is handling Marionneaux’s bill in the House, wants to make even more cuts and then look at ways to replace some lost revenue.

Marionneaux and Greene don’t like the way the bill currently is structured with the State Commission on Revenues and Expenditures (SCORE), a panel created in the legislation to look at ways to replace some of the revenues as taxes are phased out, being put in charge of whether taxes are reduced.

Greene amended the bill in a House committee to make the commission secondary, but the House floor agreed with Rep. Chris Roy Jr., D-Alexandria, that a plan should be in place before taxes are repealed.

Greene called off debate on the bill, labeling it the same as the Senate version, a “study resolution.”

And with Gov. Bobby Jindal threatening vetoes because he considers eliminating or reducing tax exemptions as tax increases, the problem gets more complicated.

Would the governor veto exemptions lifted to balance out lost revenues from lost tax revenues?

Lafayette Rep. Page Cortez said he thinks it can happen in a way that the governor might accept.

He said SCORE should have “in-depth discussions of what exemptions we have and why, and then create a tax policy that logically and properly fits the state’s needs, instead of shooting from the hip. Removing the income tax and removing exemptions is a tax shift, not an increase.”

Some of the biggest exemptions on the books are fairly new.

With the repeal of much of what was known as the Stelly Plan, the ability for taxpayers to deduct from state income taxes the amount of deductions that exceed what is allowable on federal income taxes, the state next year is expected to surrender $329.3 million.

Only 21 percent of taxpayers itemize their returns and collect that benefit.

Greene points out that if income taxes are repealed, there’s no reason for that tax break.

The state several years ago instituted an exemption for drilling horizontal wells that was designed to lure companies to open old wells that could produce more oil with the new technology.

Lawmakers at the time weren’t aware the technology would be utilized to extract natural gas from the Haynesville Shale for a loss of severance taxes totaling $83 million this year and $90 million next year.

Sen. Joe McPherson, D-Woodworth, said he believes the drilling exemption is something the state should alter.

“When you look at the Haynesville Shale with people and industries getting rich and you’ve got the state’s citizens giving up 100 percent of the tax, it ought to happen,” McPherson said.

“And there’s the motion picture credit” that is expected to draw $162.4 million in tax credits for investors next year, he said.

“They get 35 percent for making us look like a bunch of backwards idiots. No other business gets a 35 percent credit.

“We’re passing more exemptions this session,” McPherson said. “No wonder we’re in a hole.”

Sen. Robert Adley, R-Benton, said many of the exemptions were made to lure business and should remain on the books.

He said he likes the idea of lifting income taxes, but he doesn’t like the idea of replacing the money by removing exemptions.

“That’s trading one tax for another,” he said.

Adley said the state needs to step back and take a hard look at taxation and spending because “we still spend more per capita than anybody else.

“It’s hard to address these things in a session,” he said. “If we keep going to Baton Rouge and doing the same thing, finding ways to stay afloat, we’ll always have the same structure and never get the change we need. The only way is to dry up real revenue.”

Sen. Mike Michot, R-Lafayette, said, “There are undoubtedly some exemptions on the books that need revisiting, but there also are some that are very productive incentives.

“The solution,” Michot said, “would be a constitutional convention, cleaning the slate. You can’t just target one section of the economy.”

Rep. Jim Fannin, D-Jonesboro, said, “I don’t know whether or not I like doing away with the income tax if I don’t know what’s the alternative.”

Fannin said he’s “not for the bill, but the amendment says we’ll have a plan in place before it starts.”

Sen. Francis Thompson, D-Delhi, said he sees other states trying to eliminate income tax because “it’s fashionable “» It’s a good idea to move in that direction. They’re looking at those exemptions, and I probably voted for every one of them.”

Thompson said some of the exemptions apply to nonprofit groups that can’t afford to pay sales taxes, and “half of the exemptions nobody knows what they are. We need a study. It’s dangerous to exempt everything and that’s a third of our budget that’s granted in exemptions.”

Thompson said he believes “we can shrink government, but don’t shrink it on the backs of those who are most vulnerable. I’m one who believes government needs to provide services that people can’t provide themselves, like law enforcement, hospitals and education.

“Exemptions are kind of like taxes, we need to visit them ever so often to see that we have a good balance,” Thompson said.

Several lawmakers said their constituents still were steaming over the governor’s veto of a cigarette tax increase and the House refusing to override the veto.

Added to the loss of $12 million from the cigarette tax expiring in 2012 is a 6 percent discount granted to tobacco dealers on the purchase of tobacco stamps ($6.5 million) and a 6 percent discount for filing timely tax reports ($1.2 million).

“I don’t get a discount for filing my taxes on time,” Marionneaux complained on the Senate floor.

Original Article