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Several new short films, focusing on our nation’s energy situation, premiered Wednesday night in front of a sold out crowd at Sci-Port in Shreveport. The movies were shot and produced in the Ark-La-Tex.

The energy series came to life after Gregory Kallenburg’s first movie on Haynesville Shale. The movie opened his eyes to the vast difference between the way people think about energy. Kallenburg then produced 10 short films titled

Rational Middle: Energy Series.

“I think right now what we’re trying to get past is the polarized bias that exists in energy today,” said Kallenburg, who directed the series. “There is this one side having insults at the other side. What we’re trying to do is create this middle.”

Kallenburg said it was important for him to bring the movies back to his

hometown. The film was made in Shreveport by residents.

“It’s so easy for all of us to take or granted what’s around us. It’s an intellect in the United States. We flick on our light switch and lights come on. I think that once you’re able to see it’s really a privilege. That’s when you really get interested in the issue.”

The have already released three of the 10 films and Wednesday night they released another three. They expect to have all 10 released by the end of the summer.

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BATON ROUGE – Louisiana Department of Natural Resources (DNR) Secretary Scott Angelle noted today that Devon Energy recently completed its fourth horizontal well in the Tuscaloosa Marine Shale (TMS) and the initial production test figures submitted this week show the strongest oil production results of the company’s TMS wells drilled to date − at 384 barrels of oil per day (BOPD).

This newest well, located in northern St. Helena Parish, follows Devon’s successful drilling of two productive horizontal TMS wells in East Feliciana Parish and another in Tangipahoa Parish. Devon also has two other TMS well projects in progress – one in Tangipahoa and one in West Feliciana parishes.

“I want to thank Devon Energy for expressing its faith in Louisiana’s potential to provide energy and qualified workers, because I recognize that the company has a choice in where it invests its exploration funding,” Angelle said. “I hope to see Devon’s ongoing success in the Tuscaloosa Marine Shale repeated by the other operators who have begun to invest in the play, bringing the potential for economic development, jobs and new sources of domestic energy,” Angelle said.

The Tuscaloosa Marine Shale is believed to underlie much of Central Louisiana, with potential productive areas currently being explored from Vernon Parish to Tangipahoa Parish. The energy industry has been observing the development of the Tuscaloosa Marine Shale, believed to be primarily an oil-rich play. New processes and technology have led to rapid gains in domestic oil and natural gas reserves, making them recoverable from ultra-dense formations once thought uneconomical to produce.

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Among the stack of bills awaiting Gov. Bobby Jindal’s signature is one that calls on the state to purchase vehicles powered by Louisiana-produced natural gas and propane.

The House and Senate endorsed HB1213 by Rep. Stephen Ortego, D-Carencro, and sent it to the governor to decide whether it becomes state law.

“It makes sense to promote the use of our own resources,” Ortego said. “Louisiana is the No. 1 producer of natural gas and the No. 2 producer of propane in the United States.

“The most important thing to me is that we could lead the nation in energy independence,” he said. “It’s clean burning, better for the environment and promotes our own energy industry.”

Currently, compressed natural gas is selling at $1.70 for an equivalent of one gallon of gasoline and propane is selling at $2.40 per equivalent gallon.

The bill says the commissioner of administration can waive the requirements if a vehicle would not be used enough to make it economical to purchase a bifuel vehicle. The bill says the proposed law could be bypassed if it is determined a vehicle would not break even in five years.

The beauty of a bifuel vehicle, Ortego said, is it has separate tanks and can run on compressed natural gas or gasoline. At current fuel prices, a vehicle could make up the difference in sales price in less than four years if it’s driven 20,000 miles a year.

Also, the bill says a waiver can be granted to a state agency if it is located 25 miles of more from one of the 12 CNG or propane filling stations operating in the state.

Ortego said that if there are more vehicles on the roads that can use CNG, filling stations would be more willing to install storage tanks and pumps.

The cities of Lafayette and Shreveport are switching their bus fleets to CNG and the shuttles at Louisiana Armstrong Airport in New Orleans use propane, he said.

Louisiana has a tax break for service stations to install the necessary equipment and for drivers to convert vehicles.

The state offers an income tax credit of 50 percent of the cost of converting a vehicle to operate on an alternative fuel, 50 percent of the incremental cost of purchasing an original equipment manufacturer alternative fuel vehicle and 50 percent of the cost of constructing an alternative fueling station.

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The federal government is offering the central Gulf of Mexico for lease to oil and gas companies this month in the first lease sale of the area since before the BP oil spill.

It could spur drilling three miles from the barrier islands and has some environmentalists concerned about ramping up deepwater oil production in an area still reeling from the spill.

The central section makes up 60 percent of the Gulf and offers more blocks by far than the western area off of Texas or the eastern area, mostly off limits until 2022, off Florida’s coast.

Because the Department of Interior skipped a year, the central Gulf will have 914 newly available blocks that had been under lease before, which may generate a lot of interest.

The total of what’s being offered is 7,276 blocks or about 39 million acres — all of the central Gulf that’s not under lease off the shores of Louisiana, Mississippi and Alabama. There is a large section directly south of Baldwin County, Ala., that will be excluded because of prior negotiations by the state.

The sale will take place June 20 at the Mercedes-Benz Superdome in New Orleans. And the Bureau of Ocean Energy Management, which is in charge, says it could trigger the production of more than 1 billion barrels of oil and more than 4 trillion cubic feet of natural gas.

“Some of the area has never been leased before,” said John Filostrat, spokesman for BOEM. “They’re getting deeper into the area because companies are getting the technology to drill it.

“The deeper you get,” he said, “the riskier.”

But he also said that more stringent regulations have been put into place since the Deepwater Horizon spill.

The farther south the blocks go, the deeper the water, even though there are some deep pockets closer in.

It gets deep fast coming off the Mississippi River, where the Deepwater Horizon well stood. That well blew 52 miles off shore in 5,000 feet of water.

The southeastern area of the central Gulf is very deep. So just because a block is up for lease, doesn’t mean oil and gas companies will bid.

BOEM estimates the region contains close to 31 billion barrels of oil and 134 trillion cubic feet of natural gas undiscovered but technically recoverable.

The blocks begin three miles off the barrier islands, some of Alabama and most of Louisiana and go to about 230 miles offshore.

Oil production in water deeper than 1,000 feet now accounts for 79 percent of the Gulf production. In 2009, it was 72 percent. Deep water wells also account for 47 percent of the natural gas production, according to the DOI’s Bureau of Safety and Environmental Enforcement.

But bringing wells close to shore and drilling deeper are both a concern, said Raleigh Hoke of the Gulf Restoration Network.

“Some of these leases are three miles from the islands,” he said. “But at the same time they have to stay 100 miles from the Florida coast. That’s because of historic opposition.”

He said that years of opposition has given Florida and Alabama coastal tourism more consideration. His organization is part of a coalition opposing oil or gas wells within 12 miles of Mississippi’s barrier islands. It is also fighting the sale of leases in state water, which is even closer to the islands.

However, safety in deep water is also a concern.

“The industry has developed the ability to drill deeper,” Hoke said. “But has technology caught up with that to insure it’s done safely?”

The lease sale will primarily generate money for the U.S. general fund, but there is a revenue sharing system that has a complicated formula for distribution to the states.

What counties receive varies widely.

For example, Jackson County received more than $590,000 from the 2008 lease sale in the central Gulf in a year when the sale brought in $3.7 billion in high bids. But the same county received only $20,000 from the 2010 sale.

Jackson County Supervisor Mike Mangum said he’s looking forward to 2017, when the rules for distribution change and the states could receive up to $500 million.

“We don’t exactly know what that will be,” he said. “But the amount available to be distributed to the states will go up in Phase II, starting in 2017.”

Some of it depends on which blocks are leased and how close they are to Jackson County.

“But this is a big lease sale,” he said. “If there is some interest, we will certainly see more money than in 2010.”

He pointed out that the money must be spent on coastal conservation, restoration and hurricane protection. With this money added to what used to be the Coastal Impact Assistance Program, BP fine money from the spill and BP restoration money, he said, “the environment in South Mississippi will be the winner.”

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Since its difficulties with Huey Long, Big Oil has sought warm relations with Louisiana governors, and vice versa.

To advance nationally within the Republican Party, whose last national convention erupted into chants of “Drill, Baby, Drill,” contenders must at least be acceptable to the energy industry. To the broader electorate, however, Gov. Bobby Jindal, as an oil-state governor under consideration for the GOP vice presidential nomination, can’t afford to be seen as an industry toady.

Early in his first term, Jindal and the oil companies got along swimmingly, as an industry journal praised his administration’s “improved” permitting process. The state’s boom in exploration, from the Outer Continental Shelf to the Haynesville Shale, led to economic development that he could share credit for, despite the national recession.

Then came BP. The massive oil spill in April 2010 that ravaged the Gulf, the coast and its economy offered Jindal a golden opportunity: to whup up on an oil company, with the state and the nation cheering him on, and to lash out at the response of the Obama administration.

While singling out BP, Jindal championed the industry as a whole by leading the protest of the exploration moratorium imposed by the president, thus supporting the GOP’s job-killer line of attack against Obama.

As a bonus, Jindal was able to connect the state’s legal claims against BP to a 50-year, $50 billion coastal restoration plan awaiting approval, with half the funding coming from Gulf spill files and offshore revenue sharing.

Through his first term, Jindal struck a profile as a defender of the industry while a lead critic of its worst actor, and the man with the plan for the coast.

All which made the oil guys wonder why he would risk rupturing that relationship by his politics at the Legislature this spring. The companies looked to the governor to broker a favorable solution to their long-running legal battle with landowners and trial lawyers over oilfield pollution caused decades ago — the so-called legacy lawsuits.

Oil companies grew impatient and concerned that Jindal would not fully back their position. They wanted a process for having the state submit remediation plans in court that would get the sites cleaned up and limit the companies’ exposure to broader damage claims. It more than peeved oil executives that Jindal seemed sympathetic to his friends — major landowners Mike Foster and Roy O. Martin III — as well as small independent oil operators, who wanted to be let off the hook on damage claims. It further alarmed them that Jindal had collected $280,000 from trial lawyers in the last election cycle.

Much of this would have gone unnoticed by the general population but for Sen. David Vitter, who jumped in four-square behind the oil companies and called out Jindal for not forging a deal. Failing to do so, charged Vitter, maintained the status quo of the “trial lawyer bonanza.” Without saying so, he was putting Jindal’s vice presidential possibilities on the line by casting him as an ally of trial lawyers and a foe to industry.

The matter dragged on until, suddenly, with state senators pressing for a resolution and with Jindal’s assent, the agreement came together. The companies got what they wanted, the landowners and small operators got something, the trial lawyers got nothing.

Had Jindal fallen in line early with the oil companies, he may have been labeled their lackey. Instead, he stuck with the local millionaires against the corporate billionaires, for a while, before making his deal with the petro giants. If anything, the resolution enhances his VP stock by having him appear as a friend but no tool of Big Oil.

Pretty slick on his part.

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FTS International has announced a total of 127 job cuts at its Shreveport and Longview locations.

FTS International, formerly known as Frac Tech (FTSI – www.ftsi.com), is an onshore oil and natural gas well stimulation services provider.

The reduction in force at FTSI involves 89 employees at its Shreveport operations location and 38 employees at its Longview operations location.

In a statement released Friday afternoon, a company spokesperson said, ”Although this reduction in force affected only a tiny percentage of our total workforce of more than 4,000 people, we do regret that current market conditions have resulted in this impact on people and communities in northeast Louisiana and east Texas,” FTSI Corporate Communications Director Pam Percival said. “The reality is that the continuing low price of natural gas has caused a slow-down in gas well drilling and completions work in the area of the Haynesville Shale. FTSI has been moving its completions equipment and personnel to work in areas where more wells are being drilled, such as the Eagle Ford Shale in south Texas and the Permian Basin area of west Texas. We will continue to operate in the Haynesville area as long as there is a demand for our services. FTSI is also looking at utilizing workers in other areas to help minimize the effects of this market downturn.

Employment at FTSI’s Shreveport operations district now stands at 166, with 115 people employed at FTSI’s Longview operations district.

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The federal government is giving some of its beleaguered oil and gas regulators a raise as it tries to strengthen its four Louisiana field offices and compete with the private sector to recruit 200 more people to review and approve offshore drilling proposals, permits and spill-response plans. Empowered by a congressional spending bill passed in December, the Interior Department’s Bureau of Safety and Environmental Enforcement granted 25 percent raises over the base salaries of 102 petroleum engineers, geophysicists and geologists stationed in its New Orleans, Houma, Lafayette and Lake Charles offices.

The new rates took effect April 22 and have been touted by the bureau’s director, James Watson, as a key tool for recruiting and retaining employees in competition with private industry.

The employees actually are getting an 11 percent raise over their current salaries because they already had a cost-of-living adjustment equal to a 14 percent over their base pay. For example, a typical senior petroleum engineer or geoscientist making $95,459 before the raise would now make $104,524. Survey data collected by the Society of Petroleum Engineers show that the average private-sector geoscientist made $152,475 in 2011 and the average drilling engineer earned $175,363.

The Bureau of Safety and Environmental Enforcement has hired 28 new engineers since it was reorganized from the old Minerals Management Service following the BP oil spill in April 2010. Five of them were recruited and hired this year after the raise was approved by Congress, the bureau said.

Most of the work of reviewing offshore drilling permits in the Gulf of Mexico is handled by the bureau’s engineers, and they’ve come under heavy fire in the past two years. First, the attention was on the role they played in approving permits and plans for the ill-fated Deepwater Horizon rig. They approved stock spill-response plans, failed to check tests for a piece of safety equipment and took just a few minutes to approve 11th-hour changes in BP’s well design and drilling operations. President Barack Obama said the regulatory agency had a “cozy relationship” with the oil industry and ordered its overhaul.

But when that reform came in the form of three new agencies and new leadership, the scientists and engineers were demonized again by Louisiana politicians who blamed them for slow-walking permits for an industry trying to get back to work. The conflict reached a head in September when U.S. Rep. Jeff Landry, R-New Iberia, tried to meet with a bureau official in charge of permits and was turned away from the New Orleans office, then said the agency was akin to the Gestapo, Nazi Germany’s secret police.

With morale at an all-time low, even the government’s most outspoken critics say more competitive pay is justified. But some question why the raises are also going to the engineers who approved plans and permits for the Deepwater Horizon.

“It’s reasonable they should get a raise and it’s reasonable that the congressional delegation should back off, but it’s also reasonable to have some accountability for the people who are at least partially responsible for the worst environmental disaster in the history of the United States,” said Anne Rolfes, director of the Louisiana Bucket Brigade.

The bureau declined to comment on whether any regulators were disciplined as a result of the Deepwater Horizon investigation, although none of the various accident investigations found their decisions had been a direct cause of the rig explosion and oil spill.

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The recovery of offshore oil and gas production and increased natural gas production should keep the local economy humming for the next couple of years, according to an imminent Louisiana economist.

Loren Scott, professor emeritus at LSU’s E.J. Ourso College of Business, laid out his forecast for the oil and gas industry in the state at Tuesday’s South Central Industrial Association meeting in Houma.

“The energy sector is going to be the driver of the Louisiana economy and much of the U.S. economy as a matter of fact for the next couple of years,” Scott said.

While deep water petroleum production has waned the past two years since the BP oil spill, signs are pointing to a complete recovery by the middle of next year.

Scott noted that 169 drill permits were approved in 2009, with 33 deep water rigs operational. Through the first quarter of this year, 44 permits had been approved. There are currently 24 rigs online with nine drill ship and semi-submersibles coming soon.

“They’ll be in place by the middle 2013. By that time, we’ll be on your way and doing really well,” Scott said.

“We are ecstatic because the industry is building back up,” said Jane Arnett, executive director of SCIA. “That’s one thing about the people from this area. We are very resilient, and when things don’t go right we find a way to make it right.”

Although natural gas and oil prices continue to drop from record highs in recent years, local producers and shipbuilders will stay busy.

Scott listed several reasons for this positive development including the closing of oil refineries in New England, plans to retrofit liquefied natural gas terminals in the Gulf from import to export use by 2016 and emerging technology such as floating production, storage and offloading units.

Another factor is the Western Gap Treaty, signed by the U.S. and Mexico but which still needs ratification, to open up 1.5 million acres of the U.S. Outer Continental Shelf to exploration of oil and natural gas reservoirs.

“You need barges, you need ships. All of those are built here in this particular part of the state,” Scott said. “Edison Chouset, Bollinger, Gulf Island Fabrications, McDermott, all of these guys that make all these things will benefit. The more they come back to the Gulf of Mexico, this is the place that is going to see growth.”

One matter that was hard to explain is the recent drop in gasoline prices, which had declined 28 straight days as of Monday, according to AAA.

Scott noted it was a rare phenomenon on the verge of summer driving season, but he didn’t expect that to last throughout the season.

“The price of gas goes down three to five cents for every dollar the price of oil drops,” he said. “I know I have a lower end estimate (in this forecast) at $70, but I would be very surprised if it goes below $90.”

Scott projected the price of natural gas to stay between $1.50 and $2.30 mm/Btu, and oil prices in the range of $70 to $110 a barrel through 2013.

If he is correct, that should keep the local petroleum industry happy and employment rates high.

“The Houma area economy is the most energy intensive economy in the state, and one of the most energy intensive in the country with the exception of North Dakota,” he said. “So any time there is a fluctuation in the price of oil or natural gas, it shows up immediately in y’all’s employment numbers.”

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