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July 27 2012

10:30

Exposed: Pennsylvania Act 13 Overturned by Supreme Court, Originally an ALEC Model Bill

On July 26, the Pennsylvania Supreme Court ruled PA Act 13 unconstitutional. The bill would have stripped away local zoning laws, eliminated the legal concept of a Home Rule Charter, limited private property rights, and in the process, completely disempowered town, city, municipal and county governments, particularly when it comes to shale gas development.

The Court ruled that Act 13 "…violates substantive due process because it does not protect the interests of neighboring property owners from harm, alters the character of neighborhoods and makes irrational classifications – irrational because it requires municipalities to allow all zones, drilling operations and impoundments, gas compressor stations, storage and use of explosives in all zoning districts, and applies industrial criteria to restrictions on height of structures, screening and fencing, lighting and noise."

Act 13 — pejoratively referred to as "the Nation's Worst Corporate Giveaway" by AlterNet reporter Steven Rosenfeld — would have ended local democracy as we know it in Pennsylvania.

"It’s absolutely crushing of local self-government," Ben Price, project director for the Community Environmental Legal Defense Fund (CELDF), told Rosenfeld. "It’s a complete capitulation of the rights of the people and their right to self-government. They are handing it over to the industry to let them govern us. It is the corporate state. That is how we look at it."

Where could the idea for such a bill come from in the first place? Rosenfeld pointed to the oil and gas industry in his piece.

That's half of the answer. Pennsylvania is the epicenter of the ongoing fracking boom in the United States, and by and large, is a state seemingly bought off by the oil and gas industry.

The other half of the question left unanswered, though, is who do oil and gas industry lobbyists feed anti-democratic, state-level legislation to?

The answer, in a word: ALEC.

PA Act 13, Originally an ALEC Model Bill 

The American Legislative Exchange Council (ALEC) is in the midst of hosting its 39th Annual Meeting this week in Salt Lake City, Utah. ALEC is appropriately described as an ideologically conservative, Republican Party-centric "corporate bill mill" by the Center for Media and Democracy, the overseer of the ALEC Exposed project. 98 percent of ALEC's funding comes from corporations, according to CMD**.

ALEC's meetings bring together corporate lobbyists and state legislators to schmooze, and then vote on what it calls "model bills." Lobbyists have a "voice and a vote in shaping policy," CMD explains. They have de facto veto power over whether their prospective bills become "models" that will be distributed to the offices of politicians in statehouses nationwide.

A close examination suggests that an ALEC model bill is quite similar to the recently overturned Act 13. 

It is likely modeled after and inspired by an ALEC bill titled, "An Act Granting the Authority of Rural Counties to Transition to Decentralized Land Use Regulation." This Act was passed by ALEC's Energy, Environment, and Agriculture Task Force at its Annual Meeting in August 2010 in San Diego, CA

The model bill opens by saying that "…the planning and zoning authority granted to rural counties may encourage land use regulation which is overly centralized, intrusive and politicized." The model bill's central purpose is to "grant rural counties the legal authority to abandon their planning and zoning authority in order to transition to decentralized land use regulation…"

The key legal substance of the bill reads, "The local law shall require the county to repeal or modify any land use restriction stemming from the county’s exercise of its planning or zoning authority, which prohibits or conditionally restricts the peaceful or highest and best uses of private property…"

In short, like Act 13, this ALEC model bill turns local democractic protections on their head. Act 13, to be fair, is a far meatier bill, running 174 pages in length. What likely happened: Pennsylvania legislators and the oil and gas industry lobbyists they serve took the key concepts found in ALEC's bill, ran with them, and made an even more extreme and specific piece of legislation to strip away Pennsylvania citizens' rights.

There were many shale gas industry lobbyists and those affiliated with like-minded think-tanks in the house for the Dec. 2010 San Diego Energy, Environment, and Agriculture Task Force Meeting where this prospective ALEC model bill became an official ALEC model bill. They included Daren Bakst of the John Locke Foundation (heavily funded by the Kochs), Russel Harding of the Mackinac Center for Public Policy (also heavily funded by the Koch Family Fortune), Kathleen Hartnett White of the Texas Public Policy Foundation (again, heavily funded by the Kochs), Mike McGraw of Occidental Petroleum, and Todd Myers of the Washington Policy Center (a think tank that sits under the umbrella of the Koch Foundation-funded State Policy Network).

A Model That's Been Passed and Proposed Elsewhere

The Act Granting the Authority of Rural Counties to Transition to Decentralized Land Use Regulation model bill has made a tour to statehouses nationwide, popping up in Ohio, Idaho, Colorado, and Texas. The model passed in some states, while failing to pass in others.

Here is a rundown of similar bills that DeSmogBlog has identified so far:

Ohio HB 278

Long before the ALEC model bill was enacted in 2010, Ohio passed a similar bill in 2004, HB 278, which gives exclusive well-permitting, zoning, and regulatory authority to the Ohio Department of Natural Resources (ODNR). Ohio is home to the Utica Shale basin.

Mirroring ALEC's model, HB 278 gives the "…Division of Mineral Resources Management in the Department of Natural Resources…exclusive authority to regulate the permitting, location, and spacing of oil and gas wells in the state.."

Could it be that the ALEC model bill was actually inspired by HB 278? It's very possible, based on recent history.

As was the case with ALEC's hydraulic fracturing chemical fluid "disclosure" model bill (actually rife with loopholes ensuring chemicals will never be disclosed), ALEC adopted legislation passed in the Texas state legislature as its own at its December 2011 conference.

Idaho HB 464 

Idaho's House of Representatives passed HB 464 in February 2012 in a 54-13-3 roll call vote. A month later, the bill passed in the Senate in a 24-10-1 roll call vote. Days later, Republican Gov. Butch Otter signed the bill into law.

Key language from HB 464 reads

It is declared to be in the public interest…to provide for uniformity and consistency in the regulation of the production of oil and gas throughout the state of Idaho…[,] to authorize and to provide for the operations and development of oil and gas properties in such a manner that a greater ultimate recovery of oil and gas may be obtained.  (Snip)

It is the intent of the legislature to occupy the field of the regulation of oil and gas exploration and production with the limited exception of the exercise of planning and zoning authority granted cities and counties…

The Democratic Party State Senate Minority Office was outraged about the bill's passage. 

"[HB] 464 establishes Idaho law governing oil and gas exploration and development including limits to local control over the location of wells, drilling processes, water rights and the injection of waste materials into the ground," reads a press release by the Idaho State Senate Minority Office. "[HB 464] preempts local land-use planning statute dating back to 1975. Counties will have little input in the permitting process whereby well sites are selected (or restricted) and no role in planning and zoning."

Sound familiar? Like PA Act 13 and the ALEC model? It should.

Full-scale fracking has yet to take place in Idaho, though the race is on, with Idahoans signing more and more leases with each passing day. Thanks to gas industry lobbyists' use of ALEC's model bill process, the industry will have far fewer hurdles to clear in the state when the race begins. 

Colorado SB 88

The Demoratic Party-controlled Colorado State Senate struck down an ALEC copycat bill, SB 88, in February 2012.

The Bill Summary portion of SB 88 explains the bill concisely, mirroring, once again, PA Act 13 and the ALEC Model Bill: "…the Colorado oil and gas conservation commission has exclusive jurisdiction to regulate oil and gas operations, and local regulation of oil and gas operations is preempted by state law."

Colorado sits atop the Niobrara Shale basin. Like Pennsylvania, it has seen many cities successfully move to ban fracking, making the goal of a bill of this nature all the more obvious.

From Colorado Springs to Boulder County, cities and counties across Colorado have passed measures against fracking,” Sam Schabacker of Food and Water Watch told the Colorado Independent at the time SB 88 was struck down. “This bill is an attempt by the oil and gas industry to strip local governments of what little power they have to protect their citizens and water resources from the harms posed by fracking.” 

Far from a completed debate, as covered in a June 2012 follow-up story by the Colorado Independent, things are just getting underway on this one in The Centennial State.  

I don’t know where it goes from here. I suspect there is a happy medium and there is a compromise that can be reached,” Democratic Party State Senate President Brandon Shaffer told the Independent. “I also suspect next year additional legislation will come forward on both sides of the spectrum. Ultimately I think the determination will be made based on the composition of each of the chambers. If the Democrats are in control of the House and Senate, there will be more emphasis on local control.”  

Former Sen. Mike Kopp (R) was one of the public sector attendees at the Dec. 2010 Energy, Environment, and Agriculture Task Force Meeting where the ALEC model bill passed. 

Texas HB 3105 and SB 875

In May 2011, TX SB 875 passed almost unanimously. The bill essentially calls for the elimination, in one fell swoop, of the common law of private nuisance in Texas.

SB 875's key operative paragraph explains,

[Entities] subject to an administrative, civil, or criminal action brought under this chapter for nuisance or trespass arising from greenhouse gas emissions [have] an affirmative defense to that action if the person's actions that resulted in the alleged nuisance or trespass were authorized by a rule, permit, order, license, certificate, registration, approval, or other form of authorization issued by the commission or the federal government or an agency of the federal government…

Texas — home to the Barnett Shale basin and the Eagle Ford Shale basin — played a dirty trick here, but what else would one expect from the government of a Petro State?

The ALEC model bill calls for a transition from centralized power by local governments to individual property rights under the common law of private nuisance, a civil suit that allows those whose private property has been damaged to file a legal complaint with proper authorities. Now, under the dictates of SB 875, even these rights have been eviscerated.

Perhaps Texas exemplifies a realization of the oil and gas industries' ideal world: legal rights for no one except themselves.

"This [bill allows] the willful trespass onto private property of chemicals and or nuisances, thus destroying the peaceful enjoyment of private property, which someone may have put their life savings into," Calvin Tillman, former Mayor of Dish, Texas and one of the stars of Josh Fox's Academy Award-nominated documentary film, "Gasland," wrote in a letter. "Therefore, private citizens would have no protection for their private property if this amendment was added."

HB 3105's key language, meanwhile, makes the following illicit (emphases mine): 

the adoption or issuance of an ordinance, rule, regulatory requirement, resolution, policy, guideline, or similar measure…by a municipality that..has effect in the extraterritorial jurisdiction of the municipality, excluding annexation, and that enacts or enforces an ordinance, rule, regulation, or plan that does not impose identical requirements or restrictions in the entire extraterritorial jurisdiction of the municipality…or damages, destroys, impairs, or prohibits development of a mineral interest

This bill, unlike SB 875, never passed, though if it did, it would do basically the same thing as PA Act 13 and the ALEC model. If it ever does pass, however, it would mean that Texans would have literally no legal standing to sue the oil and gas industry for wrongdoing in their state.

ALEC's Bifurcated Attack: Erode Local Democracy, Strip Federal Regs,

Coming full circle, though PA Act 13 was struck down, for now, as constitutional, that doesn't necessarily mean ALEC copycat versions like it won't start popping up in other statehouses nationwide. 

Sleep on this for awhile. There's more to come.

Part two of DeSmog's investigation on ALEC's dirty energy agenda will show that, along with pushing for the erosion of local democracy as we know it today, ALEC has also succeeded in promulgating legislation that would eliminate Environmental Protection Agency (EPA) power to regulate greenhouse gas emissions - another Big Business giveaway of epic proportions.

If anything is clear, it's this: statehouses have become a favorite clearinghouse for polluters to install the "Corporate Playbook" in place of democracy.

Stay tuned for Part Two of DeSmog's investigation, coming soon.

(**Full Disclosure: Steve Horn is a former employee of CMD and worked on the ALEC Exposed project)

Image Credit: Center for Media and Democracy | ALEC Exposed

December 09 2011

18:24

Fracking Ohio's Utica Shale to "Boost Local Economy"? A "Total" Sham

It is a well-known fact that the unconventional gas industry is involved in an inherently toxic business, particularly through hydraulic fracturing ("fracking"), which the EPA just confirmed has contaminated groundwater in Wyoming. The documentary film "Gasland," DeSmogBlog's report "Fracking the Future: How Unconventional Gas Threatens our Water, Health, and Climate," and numerous other investigations, reports, and scientific studies have echoed the myriad problems with unconventional oil and gas around the globe.

What is less well-known, but arguably equally as important, is who exactly stands to benefit economically from the destruction of our land, air, and water in the gas industry's rush to profit from the fracking bonanza. The U.S oil and gas industry would have us believe that they are principally focused on ushering in American energy independence. But their claims are increasingly suspect as the real motivation of this industry becomes clearer by the day.

A hint: it's not the small "mom and pop," independent gas companies, but multinational oil and gas corporations. Another hint: it's often not even American multinational oil and gas corporations, but rather, foreign-based multinational oil and gas corporations who stand to gain the most.

France's Total S.A. Enters Ohio's Utica Shale, as well as Uganda, South Sudan and Kenya

On December 7, Bloomberg's Businessweek reported that Total S.A. is positioning itself to acquire 25 percent of Chesapeake Energy’s stake in Ohio's Utica Shale, valued at $2.14 Billion

Total S.A., the largest oil and gas producer in France, is a multinational corporation perhaps most notorious for its involvement in Iraq's "Oil-For-Food" scandal. In 2010, Total S.A. was accused of bribing former Iraqi dictator Saddam Hussein's officials to secure oil supplies. 


Total SA also brokered another big deal on December 7, this one in Uganda, a place I recently wrote about on AlterNet in a piece titled, "Did Obama Just Kick Off Another Oil War — This Time in Africa?" It appears the question raised and answered in my article is being confirmed more and more with each passing day.

Explaining the terms of the deal, Reuters wrote, "French oil major Total said it could build a pipeline from South Sudan to Uganda that would continue to Kenya’s coast, potentially solving the fledgling state’s headache about how to export its oil."

These announcements comes on the heels of a December 1 announcement by another foreign corporation, Norway's Statoil, stating that it "would like to add to its acreage position in the Eagle Ford Shale in South Texas as it looks to grow its unconventional oil and gas position in North America."

Speaking of corruption, by the way, Ohio is a natural landing spot for Total S.A.

Ohio: Home to Big Gas Money

Common Cause of Ohio, in a recent report titled "Deep Drilling, Deep Pockets," revealed that from 2001 through June 2011, Republican Governor John Kasich received $213,519 in campaign contributions from the gas industry. The Republican Senatorial and House Campaign Committees took another $210,250 from the gas industry during that same time period.

Not to be outdone, on the other side of the aisle, former Democratic Governor of Ohio, Ted Strickland, received $87,450 during that time frame. 

Top donors included the following:

  • Ohio Oil & Gas Producers Fund - $820,285
  • British Petroleum PAC & Employees - $215,438
  • Marathon Oil PAC & Employees - $207,054

Summing things up, Common Cause wrote,

Companies engaged in fracking contributed $2.8 million to state candidates, political committees, and parties in Ohio from 2001 through June 2011, helping the natural gas industry preserve what are some of the nation’s most lenient fracking regulations. Ohio does not require full disclosure of chemicals used in the fracking process, has stripped from local governments the power to regulate fracking, and allows fracking as close as 100 feet to a residence.

All in all, this is a bad deal for the people of Ohio, but a great deal for global multinational oil corporations, a pattern all too familiar in the American political fray.

Any way one slices it, the claim that the gas industry first and foremost is a "good neighbor" who will "benefit the local economies," is a total sham. 

 

November 18 2011

13:15

ExxonMobil and Shell Eyeing North American LNG Export Deals

Yesterday, LNG World News reported that ExxonMobil Vice President Andrew Swiger announced, at a conference hosted by Bank of America Merrill Lynch, that it was actively seeking LNG (liquefied natural gas) export terminals throughout North America, including, but not limited to, in British Columbia and on the Gulf Coast.

In terms of exports from North America, whether it is the Gulf Coast or whether it is Western Canada, it’s something we’re actively looking at,” said Swiger.

So, where are these prospective export terminals located, what are the key pipelines carrying the unconventional gas produced from shale basins, and what are the key shale basins in the mix? Hold tight for an explanation.

Golden Pass LNG Terminal and Golden Pass Pipeline

The LNG World News article explains that ExxonMobil "has a stake in the Golden Pass LNG Terminal in Texas," but does not explain exactly what the "stake" is.

A bit of research shows that ExxonMobil is a 17.6% stakeholder in the Golden Pass LNG Terminal, according to a March 2011 article publshed by Platts. It is co-owned by ConocoPhillips and Qatar Petroleum, who own a 12.4% and 70% stake in Golden Pass LNG, respectively.

Golden Pass LNG is stationed in Sabine Pass, TX, located on the Gulf Coast on the Texas-Louisiana border, which is in close proximity to Cheniere's Sabine Pass LNG export terminal, a terminal which has been written about in-depth by DeSmogBlog.

As of now, Golden Pass is an import terminal, and "is among the largest LNG import facilities worldwide, with the capacity to import 15.6 million metric tons of LNG annually," explains LNG World News. But many import facilities have turned into export facilities, including the Jordan Cove LNG terminal in Coos Bay, Oregon, the Dominion Cove LNG terminal in Lusby, Maryland, and Kitimat LNG terminal in Kitimat, British Columbia. Gas corporations often execute the bait-and-switch, transforming what were originally import terminals into export terminals.

If history repeats itself, which is highly likely based on this latest report from LNG World News, then the Golden Pass LNG Terminal could soon be transformed into an export terminal, making it export terminal number two in Sabine Pass.

It appears for now that the gas would come from the shale basins surrounding Sabine Pass, meaning the Barnett Shale, the Eagle Ford Shale, the Haynesville Shale, and the Fayetteville Shale, and flow out these respective shale basins via an extensive pipeline system, to the key Golden Pass and Sabine Pass hubs. 

For example, Golden Pass also owns Golden Pass Pipeline, which runs from the Haynesville Shale down to the Golden Pass LNG terminal.

Horn River Basin Shale and Pacific Trail Pipelines

LNG World News' article also mentions that ExxonMobil "has 340,000 shale gas acres in Western Canada’s Horn River Basin." The Horn River Shale Basin is located in northeastern British Columbia and sits on 250 trillion cubic feet of unconventional gas, producred through the toxic hydraulic fracturing, or fracking process. 

Assuming ExxonMobil holds true to the pronouncement made by Swiger, much of the gas produced in the Horn River Basin will flow westward to Kitimat LNG export terminal, which ships gas to the Asian market. 

One of these facilities is co-owned by EOG Resources (EOG), EnCana Corporation (EnCana), and Apache Corporation (Apache). In October 2011, Canada’s National Energy Board, the Canadian equivalent to the U.S. Federal Energy Regulatory Commission, granted Kitimat LNG a 20-year Export Licence to serve international markets. The Pacific Trail Pipelines connect the Horn River Basin to the Kitimat LNG facility and are also co-owned by EOG, EnCana, and Apache. 

Another key LNG export terminal in the works will be co-owned by Shell, Korea Gas Corporation, China National Petroleum Corporation, and Mitsubishi Corporation.

The Globe and Mail explained the looming deal, writing

Shell is examining plans for a 3.6 billion cubic feet a day project, which would be among the largest under consideration in the world…Kitimat LNG intends to build a 700-million cubic foot facility first, at a cost greater than $5-billion, but has received an export licence that allows it to double that. The partnership intends to make a final investment decision early next year, but is already spending several hundred million dollars to terrace the sloped site of the intended terminal, the first step in construction.

A pipeline arrangement paralleling the EOG, EnCana, Apache agreement will likely follow the Shell export deal announcement, carrying gas fracked from the Horn River Shale Basin to Kitimat, in order to be exported, in the form of LNG, to the profitable Asian market. 

North American Export Market a Huge Racket

As is now perfectly clear and has been made clear by DeSmogBlog on multiple occasions, not only is the unconventional gas industry unconcerned with the "domestic consumption" of gas for "national security" purposes, but perhaps even more importantly, two of the largest fossil fuel corporations in the world, Shell and ExxonMobil, are now in the fray of the export game.

Deals of this nature will likely proliferate as time progresses, with what has been coined the "one-percent" by the Occupy Wall Street movement, standing with the most to gain from them.

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