House leadership supports U.S. offshore overhaul

Oct. 12 (UPI) — An offshore drilling act critics said was “wish list” legislation for the oil and gas industry was hailed as a strategic win by House Republican leadership.

The House Natural Resources Energy and Mineral subcommittee heard testimony Wednesday on the Accessing Strategic Resources Offshore Act, or ASTRO. The measure would limit the presidential authority to put parts of the Outer Continental Shelf off limits to oil and gas drillers and give the Interior Department the authority to move ahead with new lease sales “as soon as practicable,” but no later than a year after the announcement of intent.

Subcommittee Chairman Paul Gosar, R-Ariz., said the offshore oil and gas industry is vital for U.S. economic success, generating “billions of dollars” in revenue and creating “millions” of direct and indirect jobs in the country.

“It is critical that we maintain and increase access to offshore exploration and production to improve upon these trends,” he said in a statement.

The committee said that, under former President Barack Obama, more than 90 percent of U.S. territorial waters were off limits to drillers. The Republican-led committee said opening up more areas to drillers could create more than 800,000 new jobs and generate $ 200 billion in revenue.

When the committee rolled out its agenda last week, a spokesman for offshore advocacy group Oceana told UPI the ASTRO Act is “the kitchen sink of the oil industry’s wish list.” After the hearing, Ocean campaign director Diane Hoskins said the bill was extreme.

“This is a clear attempt by a few in Congress to provide massive giveaways to special interests in the oil and gas industry,” she said in a statement emailed to UPI. “With an oil surplus and gasoline prices near recent historic lows, it makes absolutely no sense to put our coastal communities and state economies at risk from more drilling.”

Apart from expanding access to drillers, the ASTRO Act would recombine the Bureau of Ocean Energy Management with the Bureau of Safety and Environmental Enforcement. The BSEE was set up in response to failures with the former federal Minerals Management Service in the Deepwater Horizon oil spill in the Gulf of Mexico in 2010.

“I think such a recombination is not just a profoundly bad idea that would be unnecessarily disruptive for the agencies and the industry and for which no clear case has been made, but it is also a dangerous idea that would significantly raise the risk of a catastrophic offshore accident,” Michael Bromwich, the director of the BOEM at the time of 2010 spill, testified.

The federal government estimates about 90 billion barrels of oil have yet to be discovered in U.S. territorial waters. Erik Milito, the director of industry operations for the American Petroleum Institute, testified that unplanned supply disruptions from the global market, meanwhile, can sometimes put more than 3 million barrels per day off limits, which is about three times what North Dakota produces. A bigger offshore reach, he said, would boost U.S. energy security.

“We can and should do more,” he said.

Let’s block ads! (Why?)

Business News – UPI.com

British government unveils green spending plans

Oct. 12 (UPI) — The British government said Thursday it would spend more than $ 3 billion on new energy systems that could help it meet obligations for a low-carbon economy.

The British government is legally bound to a commitment to cut greenhouse gas emissions, which are counted as the main contributors to climate change, by 80 percent of their 1990 levels by 2050. The government said Thursday it would invest and spend around $ 3.1 billion through 2021 on new energy systems, nuclear power and renewable energy strategies to help meet its 2050 target.

British Minister for Climate Change and Industry Claire Perry said that emissions last year were 42 percent lower than the 1990 benchmark and 6 percent lower than in 2015. At the same time, British gross domestic product increased 67 percent from 1990.

“On a per person basis, this means that we have reduced emissions faster than any other Group of Seven nation and led the G7 group in growth in national income over the period,” she said in a statement.

The measure drew praise from the fossil fuels industry, which said the strategy was pegged in part to natural gas and the use of carbon, capture and storage, a technique designed to lower emissions from oil and gas production and power plants.

“Natural gas will continue to be a critical fuel for the U.K. in the transition to a low carbon economy,” Ken Cronin, the chief executive of the U.K. Onshore Oil and Gas trade group, said in a statement. “As the report makes clear, the reforming of methane with carbon capture and storage is likely to be the primary means of producing low carbon hydrogen, which has great potential to decarbonize heating, transport and industry and improve air quality.”

About a third of the total spending plan goes toward carbon, capture and storage. To meet the benchmarks outlined in the Paris climate agreement, the International Energy Agency said CCS “will not be optional.”

After the British Parliament backed a measure that gave clarity for the path out of the European Union in September, Buskut Tuncak, a U.N. special envoy on hazardous substances, told the U.N. Human Rights Council that London risks stepping away from some of the highest environmental standards in the world as it leaves the EU.

In July, however, the British government unveiled plans to ban all new gasoline- and diesel-powered vehicles from its roads beginning in 2040. For power on the British grid, data show the share of electricity generated by renewable resources was 26.6 percent in the first quarter, up 1 percent from the same period last year.

Let’s block ads! (Why?)

Business News – UPI.com

Brent crude oil prices lower despite Gulf of Mexico idling

Oct. 9 (UPI) — Crude oil prices were drifting into negative territory early Monday on suggestions that more U.S. shale oil could move into the global marketplace.

Crude oil prices have been on a general downward trend for most of October, eating into September gains sparked by the upheaval that Hurricanes Harvey and Irma brought to the U.S. energy sector. Markets so far have shrugged off the impact from now post-tropical cyclone Nate, which idled about 90 percent of the total oil production capacity in the Gulf of Mexico.

An emailed report from Bank of America-Merrill Lynch said Monday that recent gains in crude oil prices could help drive U.S. shale production through next year.

“Given its short-cycle nature and large sensitivity to price, the recent strengthening in oil prices to over $ 50 per barrel on a calendar 2018 basis could well stem the decline in rig activity, and positively impact production within six to nine months,” the report read.

U.S. shale oil production matters for traders watching the global balance between supply and demand. Dozens of major oil producing nations are working alongside the Organization of Petroleum Exporting Countries to drain the surplus on the five-year average for global crude oil inventories with managed production declines.

The BofA-Merrill Lynch report said U.S. shale oil production should increase 470,000 barrels per day this year and another 690,000 barrels per day next year. Growth slows, however, by fourth quarter 2018.

The price for Brent crude oil was down 0.56 percent at 9:00 a.m. EDT to $ 55.31 per barrel. The price for West Texas Intermediate, the U.S. benchmark for the price of oil, was inching slightly higher, gaining 0.34 percent from Friday to $ 49.46 per barrel.

WTI is still trading in the November contract, while Brent moved to December. The difference, or spread, between Brent and WTI makes U.S. oil competitive on the global market and BofA-Merrill Lynch said it saw few future constraints for U.S. exports.

Elsewhere, the Organization for Economic Cooperation and Development said Monday it is anticipating steady growth in major economies like the United States and Germany.

“Composite leading indicators, designed to anticipate turning points in economic activity relative to trend six to nine months ahead, continue to point to stable growth momentum in the OECD area as a whole,” its Monday report read.

Let’s block ads! (Why?)

Business News – UPI.com

Austal, Lockheed given green light on construction of next LCS

Oct. 9 (UPI) — The U.S. Navy’s next generation of assault transport vessels were given the financial green light, the Defense of Department announced Friday, despite a legacy of questions concerning survivability in hostile environments.

Austal USA and Lockheed Martin Corp., both global manufacturers of naval defense ships, were awarded contracts not-to-exceed the congressional cost cap of $ 584 million for the construction of a littoral combat ship, or LCS, for the Department of the Navy.

The companies are responsible for handling the design, construction, and test trials of the LCS with the Pentagon expecting to release future announcements for competitive solicitation for additional LCS class ships, according a the Pentagon press release.

Work on the LCS by Austal USA is expected to be completed by October 2023, with 54 percent of the labor occurring at their headquarters in Mobile, Alabama. Lockheed Martin has the same projected delivery time frame with the bulk of the assembly, accounting for 37 percent of the LCS’s construction occurring in Marinette, Wisconsin.

The LCS is designed for naval operations against asymmetrical threats and anti-access obstacles in littorals near the coastline, according to the Navy. The LCS sports a flight deck and hangar for housing two SH-60 or MH-60 Seahawk helicopters and can deliver a small assault force that can deploy off the ship itself. Currently, the Freedom and Independence class are the first of the two LCS variants. The USS Freedom made its inaugural deployment for sea trials in February 2013.

In July 2017, the Navy sought information for a new multi-mission guided-missile frigate that can perform the same roles as the LCS, capable of better offensive and defensive capabilities.

A 2010 report by the Defense Department’s Operations Test and Evaluation office raised concerns over Lockheed’s LCS ship construction as it did not meet the Navy’s stability requirements, in addition to multiple failures of the ship’s TRS-3D radar, a system used for conducting surface and air surveillance and rapid target acquisition of enemy threats.

Since the report, contracting companies have addressed bolstered the bulkheads of the LCS and the Navy laments the ship could still be used in hostile areas because it would be escorted and protected by other naval ships with greater armament and armor.

The Navy Times reported in December 2015, that Ash Carter, then the Secretary of Defense under President Barack Obama, ordered the Navy to reduce the planned procurement of LCSs to its naval fleet from 52 to 40 vessels.

Let’s block ads! (Why?)

Business News – UPI.com

We're not satisfied yet with markets, Saudi oil minister says

Oct. 5 (UPI) — The move by OPEC and non-OPEC producers to balance the market is working, but the work is not yet finished, Saudi Arabia’s oil minister said from Moscow.

An energy forum under way in Moscow and St. Petersburg is about halfway through. Speaking at the conference, Saudi Oil Minister Khalid al-Falih said market recovery is apparent, and the success of the agreement is obvious, but producers can’t relax yet.

“We will not be satisfied with what we have,” he was quoted by Russian news agency Tass as saying. “Until we reach the appropriate level of balance, until this goal is achieved we cannot finish our work.”

The agreement, implemented in January, is designed to bring the global level of crude oil inventories closer to the five-year average. An oversupplied market last year, brought on by U.S. oil production and OPEC members working to defend market shares with more output, helped pushed the price of oil below $ 30 per barrel.

Global crude oil inventories are moving closer to balance and Falih said that, by the fourth quarter, supply will be less than demand. Pointing to output from U.S. shale basins, the minister said any acceleration should more or less keep pace with demand.

Russian Energy Minister Alexander Novakhinted the agreement could be extended into summer 2018. Parties to the agreement between members of the Organization of Petroleum Exporting Countries and non-member states already agreed this year to extend it into March 2018.

Answering questions from Bloomberg News on Wednesday, Russian President Vladimir Putin said he couldn’t rule out further extensions.

“Whether we will extend these agreements or not will depend on the situation in the world market,” he said. “But in general, speaking about a potential extension, it should last at least to the end of 2018.”

The meeting in Russia started with a call from Russia’s energy minister to add a monitoring mechanism for exports. Industry and trade sources told UPI that may require a third party to monitor crude oil exports effectively. The U.S. Energy Information Administration publishes weekly data on domestic crude oil exports from the United States and imports from top exporters to its market. The Joint Organizations Data Initiative publishes export metrics, though the most recent data are from July.

Let’s block ads! (Why?)

Business News – UPI.com

Navy to repair USS John S. McCain in Japan

Oct. 5 (UPI) — The guided missile destroyer USS John S. McCain, damaged in a collision with an oil tanker in August, is to be repaired by the Navy in Japan.

The U.S. Navy said the repairs will begin this month at the U.S. Naval Ship Repair Facility-Japan Regional Maintenance Center in Yokosuka, Japan, when the destroyer arrives from Singapore aboard a heavy-lift vessel.

“Damage assessments conducted while the ship was moored in Singapore since the Aug. 21 collision revealed the scope of work could be completed in Japan at the lowest estimated cost and returns the ship to full service at the earliest opportunity,” the Navy said in a news release.

Ten sailors were killed when the McCain collided with the merchant vessel Alnic MC east of the Straits of Malacca and Singapore on Aug. 21. Investigations into the incident are underway.

The ship’s crew, in addition to supporting repairs to the ship, will focus on training, readiness and certifications to prepare the ship for operational tasking in the Seventh Fleet.

Let’s block ads! (Why?)

Business News – UPI.com