From: Morning Consult
To: Scott Jenkins,
Subject: Morning Consult Energy: Airstrikes Target Oil Refineries Held by Islamic State
Date: Thu Sep 25 13:10:07 MDT 2014


By Emily Holden (@emilyhholden)



Today’s Washington Brief:

  • U.S. and allied Arab warplanes bombed a dozen small oil refineries in Syria in an attempt to cut off a revenue stream for the Islamic State, Los Angeles Times reports. Sen. Lisa Murkowski, ranking Republican on the Energy Committee, says the U.S. could make up for any shortfall on global markets, Reuters reports.  

  • Representing a shift in the national discussion, Texan lawmakers who represent districts with large oil refineries have come to support lifting the ban on oil exports. Reuters' Edward McAllister has the story.

  • Oil companies are lobbying the White House for flexibility on oil development standards in the Arctic waters north of Alaska, according to Houston Chronicle's Jennifer A. Dlouhy.

Today’s Business Brief:

  • Houston-based USD Group is planning to spin off three rail terminals into a new master limited partnership--making it among the first to have a crude-by-rail focused initial public offering, Houston Chronicle's Robert Grattan explains

  • If Mexico wants to develop rich shale fields along the Gulf Coast and attract investors, it will have to keep cartels from stealing billions of dollars worth of oil from state-owned pipelines, AP's Mark Stevenson reports

  • Pennsylvania has some of the worst natural gas leaks in the country--more than 10,000 miles in distribution pipes that could cost $11 billion to replace, AP reports.  


Today's Chart Review: 


Everywhere but Northeast, fewer homes choose natural gas as heating fuel

from Energy Information Administration 




Mark Your Calendars (All Times Eastern): 


Thursday: Shale Insight conference continues in Pittsburgh @ 8 am 

Thursday: Resources for the Future forum with remarks by EPA's McCarthy @ 10 am

Thursday: Natural Gas Roundtable with ClearView's Christi Tezak @ Noon 

Thursday: Bipartisan Policy Center  talk  on early action and the EPA's carbon emissions proposal @ 1 pm


1-10: General
11-17: Oil
18-19: Natural Gas
20-22: Utilities and Infrastructure
23-24: Coal
25-26: Renewables




27: Bloomberg
28: Center for American Progress




29: Staff for Sen. Lisa Murkowski, R-Alaska
30: Congressional Research Service 
31: IOP Science






1) Emissions From India Will Increase, Official Says

from New York Times by Coral Davenport


In a blow to American hopes of reaching an international deal to fight global warming, India’s new environment minister said Wednesday that his country would not offer a plan to cut its greenhouse gas emissions ahead of a climate summit next year in Paris...“What cuts?” Mr. Javadekar said. “That’s for more developed countries. The moral principle of historic responsibility cannot be washed away.” Mr. Javadekar was referring to an argument frequently made by developing economies — that developed economies, chiefly the United States, which spent the last century building their economies while pumping warming emissions into the atmosphere — bear the greatest responsibility for cutting pollution.


2) Shell, ConocoPhillips plead White House for flexibility in Arctic

from Houston Chronicle by Jennifer A. Dlouhy 


Oil companies hoping to find crude under Arctic waters north of Alaska are imploring the Obama administration to ensure new rules governing drilling in the region don’t force them to stash emergency equipment nearby or block them from using chemical dispersants to clean up any spills.

The pleas for flexibility were delivered by Shell Oil Co. and ConocoPhillips in private meetings earlier this month with the Office of Management and Budget, which is reviewing an Interior Department proposal that would set standards governing oil development in the remote Arctic frontier.


3) Pipeline, Hazardous Materials Safety Regulator Quarterman Resigns

from Wall Street Journal by Amy Harder 


A top federal safety regulator tasked with handling the U.S. government's response to a string of oil-train crashes in recent years is stepping down, agency officials said Wednesday. Cynthia Quarterman, administrator of the Pipeline and Hazardous Materials Safety Administration, which is part of the Transportation Department, will leave on Oct. 3, the officials said.


4) Steyer's climate PAC turns to Oregon, Washington state Senate races

from Washington Examiner by Zack Colman 


Billionaire ex-hedge fund manager Tom Steyer's Super PAC is turning to state Senate races in Oregon and Washington to boost Democratic candidates, a move that would help legislatures there pass climate change bills. Steyer's NextGen Climate Action PAC has focused on Senate and gubernatorial races. But much like conservative groups funded by the billionaire industrialist Koch brothers, the move toward state races underscores the belief that state legislatures can act while Congress remains stuck on energy and climate issues...Steyer already has shifted $1 million from his national group to a state chapter in Washington, according to public disclosure filings. NextGen Climate will combine with the Washington and Oregon chapters of the League of Conservation Voters for the effort.


5) Inside the Koch Brothers' Toxic Empire

from Rolling Stone by Tim Dickinson 


The enormity of the Koch fortune is no mystery. Brothers Charles and David are each worth more than $40 billion. The electoral influence of the Koch brothers is similarly well-chronicled. The Kochs are our homegrown oligarchs; they've cornered the market on Republican politics and are nakedly attempting to buy Congress and the White House...What is less clear is where all that money comes from...The volume of Koch Industries' toxic output is staggering. According to the University of Massachusetts Amherst's Political Economy Research Institute, only three companies rank among the top 30 polluters of America's air, water and climate: ExxonMobil, American Electric Power and Koch Industries. 


6) States Won’t Leave Carbon Market for California, Quebec

from Bloomberg by Lynn Doan 


California and Quebec, which together created the largest carbon market in North America this year, may come away empty-handed as they woo northeastern U.S. states to join their system. States including Vermont, which Quebec’s premier said yesterday is particularly interested in uniting, are members of a Northeast group that has been operating an emissions-trading system since 2008. And they’ve shown no signs of abandoning that cause, said Kelly Speakes-Backman, chair of the Regional Greenhouse Gas Initiative known as RGGI.


7) Cities Will Solve Climate Change, Not Nations

from Scientific American by David Biello 


In the 1980s, the Chinese city of Shenzhen had some 300,000 mostly impoverished inhabitants. Today that city, the first to experience China's reforms and economic opening, has more than 15 million residents and also hosts another first in China's history—a carbon market. Shenzhen's market to reduce global warming pollution covers some 620 manufacturers and other industries that collectively grew by 9 percent in 2013. The buying and selling of permits to emit carbon dioxide pollution resulted in a drop of 500,000 metric tons in the manufacturing sector and swapping cleaner energy for coal reduced carbon dioxide emissions by an additional 2 million metric tons for the entire city.


8) The Benefits of Easing Climate Change

from New York Times by Eduardo Porter 


On Tuesday, more than 100 world leaders gathered at the United Nations to open a climate summit meeting that Secretary General Ban Ki-moon hopes will provide momentum to a new round of negotiations toward a global environmental agreement to be signed in Paris next year. You’re forgiven if you hold your applause. World leaders have been trying without success to cut such a deal for almost two decades, crashing time and again into the fear that slowing the emissions of carbon that are inexorably changing the climate carries an economic cost that few are willing to bear. This time, though, advocates come armed with a trump card: All things considered, the cost of curbing carbon emissions may be considerably cheaper than earlier estimates had suggested.


9) Obama to create world’s largest protected marine reserve in Pacific Ocean

from Washington Post by Juliet Eilperin 


President Obama will use his legal authority Thursday to create the world’s largest fully protected marine reserve in the central Pacific Ocean, demonstrating his increased willingness to advance a conservation agenda without the need for congressional approval. By broadening the existing Pacific Remote Islands National Marine Monument from almost 87,000 square miles to more than 490,000 square miles, Obama has protected more acres of federal land and sea by executive power than any other president in at least 50 years and makes the area off-limits to commercial fishing.


10) U.S. Stock-Index Futures Little Changed Before Reports

from Bloomberg by Inyoung Hwang 


U.S. stock-index futures were little changed, after the Standard & Poor’s 500 Index climbed the most in over a month, as investors awaited data on jobless claims and durable-goods orders...Futures on the S&P 500 expiring in December slipped 0.1 percent to 1,989.2 at 6:27 a.m. in New York. The benchmark equity gauge climbed 0.8 percent yesterday, its biggest gain since Aug. 18, as new-home sales jumped to a six-year high, and health-care shares rallied with producers of consumer staples. Contracts on the Dow Jones Industrial Average fell 7 points, less than 0.1 percent, to 17,132 today.



11) Airstrikes target oil refineries in Syria held by Islamic extremists

from Los Angeles Times by Brian Bennett, W.J. Hennigan


king the first major push to choke off financing for Islamic State, U.S. and allied Arab warplanes bombed a dozen small oil refineries in eastern Syria on Wednesday that U.S. officials said were part of a $2 million-a-day revenue stream for the Sunni Muslim extremist group. The Obama administration also named 11 individuals and one supposed charity as global terrorists, accusing them of recruiting foreign fighters, shipping weapons and raising millions of dollars for Islamic State and several affiliated groups.


12) U.S. oil could step in if Mideast fields knocked out: senator

from Reuters by Timothy Gardner 


If U.S.-led attacks knock out oil fields controlled by Islamic State militants, petroleum from the American drilling boom could make up for any shortfall on global markets, according to a report released by Alaska Senator Lisa Murkowski, the top Republican on the chamber's energy committee.


13) Lawmakers in U.S. oil heartland soften over export ban

from Reuters by Edward McAllister 


In the oil drilling and refining heartland of Texas, the debate over U.S. crude exports is no longer a fight over whether a 40-year ban should be lifted. The question now is how soon it will end. As Washington mulls reversing the ban amid a drilling boom that has swamped the U.S. Gulf Coast in oil, Texan lawmakers are already preparing for the prospect of crude oil exports from the state's major ports, and assessing what it means for constituents. Even representatives of districts that include large oil refineries, the owners of which have expressed strong opposition to exports for fear it would increase the price of crude, told Reuters that they would support the shipment of oil overseas.


14) With new IPO, MLPs move further toward rail

from Houston Chronicle by Robert Grattan


Most everyone is familiar with the master limited partnership, but energy company USD Group is looking to put a unique spin on the structure with a crude-by-rail focused initial public offering. Houston-based USD Group filed for a $150 million IPO earlier this month, planning to spin off three rail terminals in Texas, California and Alberta into a new master limited partnership called USD Partners LP. The new company won’t be the first master limited partnership to own rail assets, but it is among the first to have an explicit rail-first strategy, according to industry experts.


15) BP won’t get restitution for spill settlement payments, U.S. Judge Barbier says

from Houston Chronicle (AP)


BP wanted its money back — hundreds of millions of dollars of it — but a federal judge said Wednesday that the oil giant must stick by its agreement with the companies it compensated for business losses due to the 2010 Gulf oil spill. BP argued that a flawed funding formula in their settlement with alleged victims of the spill enabled many businesses to collect on questionable claims, and that they should be forced to return the money.


16) Mexican Cartels Steal Billions from Oil Industry

from AP by Mark Stevenson 


Mexico overcame 75 years of nationalist pride to reform its flagging, state-owned oil industry. But as it prepares to develop rich shale fields along the Gulf Coast, and attract foreign investors, another challenge awaits: taming the brutal drug cartels that rule the region and are stealing billions of dollars' worth of oil from pipelines. Figures released by Petroleos Mexicanos last week show the gangs are becoming more prolific and sophisticated. So far this year, thieves across Mexico have drilled 2,481 illegal taps into state-owned pipelines, up more than one-third from the same period of 2013. Pemex estimates it's lost some 7.5 million barrels worth $1.15 billion.


17) Canadian PM says U.S. will approve Keystone XL pipeline eventually

from Reuters by Liana B. Baker 


Logic dictates that the United States will one day approve the northern leg of TransCanada Corp's controversial Keystone XL crude oil pipeline, Canadian Prime Minister Stephen Harper told an audience of executives in New York on Wednesday.


Natural Gas


18) Pennsylvania natural gas leaks among worst in nation

from Houston Chronicle (AP)


A newspaper reports Pennsylvania has more than 10,000 miles of dangerously leaky, decades-old natural gas distribution pipes and it could cost $11 billion to replace them all. Federal records show Philadelphia has the highest concentration of leaky gas lines in the state, the Pittsburgh Tribune-Review reported Tuesday on its website. In 2013, Philadelphia Gas Works reported 89 leaks per hundred miles of gas line — eight times the national average.


19) Asian LNG Buyers Bet on Growing Supply, Evolving Markets

from Wall Street Journal by Eric Yep


Asian natural-gas consumers are betting that a new wave of gas supply and a rapidly evolving marketplace will help reduce prices in the next two to three years, executives said at a gas conference in Singapore. Liquefied natural gas is priced higher in Asia due to the additional cost of converting the gas into a liquid and transporting it on ships. Gas producers have also enjoyed strong prices as the fuel was in short supply after the Fukushima nuclear disaster shut Japan’s nuclear reactors and regional demand surged.



Utilities and Infrastructure


20) Letting the Utility Company into Your Home & Business

from Roll Call by Randy Leonard 


Beyond smart meters and two-way distributed generation, the grid of tomorrow will incorporate control of the demand on the customer’s side of the meter with smart thermostats, electric carsthat communicate with the grid and innovations that we have yet to develop, according to power experts.


21) New York Proposes $5B for Clean Energy Fund, New Regulatory Model

from Greentech Media by Jeff St. John 


New York wants to spend $5 billion over the next decade to transition from a regime based on soon-to-expire renewable-energy and efficiency mandates into a new regulatory and economic model that brings distributed, customer-owned energy assets into account. In a Tuesday filing with state regulators (PDF), the New York State Energy Research and Development Agency (NYSERDA) proposed raising $5 billionfrom electric bill surcharges over the next ten years to create a Clean Energy Fund (CEF), one that would essentially take over responsibility to “ensure the delivery and continuity of clean energy programs” statewide.


22) Unique Minnesota data project illuminates cities’ energy use

from Midwest Energy News by Frank Jossi 


A unique data project in Minnesota is giving city leaders a clearer picture of how their residents use energy.

For instance, conventional wisdom would suggest that densely populated Minneapolis and St. Paul would use the least energy per capita in the Twin Cities metro area. However, it’s actually Hopkins, an inner-ring suburb near Minneapolis, followed by Falcon Heights, a small burg on the edge of St. Paul, that take the top spots (the most energy-intensive is Lake Elmo, a largely rural exurban community).





23) Grimes: Both McConnell And His Wife Have Failed Coal Miners

from Huffington Post by Dave Jamieson 


The campaign of Democratic Senate candidate Alison Lundergan Grimes has ripped her opponent, Sen. Mitch McConnell (R-Ky.), for siding with the coal industry over miners on issues of mine safety. But now the Grimes camp is extending that attack to McConnell's wife, Elaine Chao, the former secretary of labor under George W. Bush.In a statement to HuffPost, Grimes spokeswoman Charly Norton said that Chao's tenure as head of the Labor Department, which includes the Mine Safety and Health Administration, was a disaster for miners.


24) India Supreme Court Cancels Hundreds of Coal Licenses

from Wall Street Journal by Saurabh Chaturvedi 


India's Supreme Court canceled hundreds of coal-mining licenses, adding uncertainty beyond the struggling coal industry to the heart of Asia's third-largest economy. The country's highest court on Wednesday said control over almost all coal blocks allotted since 1993 will have to be returned, saying they were granted illegally. The decision could aggravate a coal shortage in the country, analysts said.





25) Beginning in 2016, Southwest Airlines will use biofuels

from Kansas City Star 


Southwest Airlines announced Wednesday that it plans to buy some biofuels made from waste wood for use in its San Francisco Bay airports beginning in two years. To use Southwest’s phrasing, it is purchasing “low-carbon renewable jet fuel, made using forest residues that will help reduce the risk of destructive wildfires in the western United States.” It has agreed to buy about 3 million gallons a year from Red Rocks Biofuels, a Fort Collins, Colo., company that focuses on recycling that foresty stuff.

That won’t provide much of Southwest’s needs.


26) Cheaper Solar, Fewer Incentives

from Roll Call by Randy Leonard 

Prices paid for consumer solar systems have continued to decline even as state and utility incentive programs ramp down.Prices for installed commercial and residential photovoltaic systems fell 12 to 15 percent last year to $4 to $5 per watt, about a third of 1998 prices, according to a recent report from Lawrence Berkeley National Laboratory and the Energy Department’s SunShot initiative.





27) Your Island Sinking? Go to Canada

from Bloomberg by Christopher Flavelle 


Today's United Nations climate summit is a reminder that rich countries still aren't ready to make deep cuts to their carbon emissions or make significant payments to help poor countries cope with the consequences of those emissions. Which raises the question: For countries that want to be good global citizens, is there a third option? How about giving the people displaced by climate change somewhere else to live? There's no obligation under international law to provide asylum to those whose homes are rendered unlivable by rising sea levels, crop failure, severe storms or other consequences of climate change. 


28) How to Slow Near-Term Arctic and Global Warming

from Center for American Progress by Gwynne Taraska and Patrick Clouser 


The Arctic is in need of near-term temperature control. It is warming at a higher rate than the global mean and is experiencing climate impacts, such as thawing permafrost and rapidly melting sea ice, that have adverse effects on not just the region but also the global climate system. Reductions in methane emissions are key to decreasing the rate of near-term warming and are an essential component of an overall greenhouse gas-mitigation strategy. 






29) A Dark Pool in the Mideast: The Problem of ISIS Oil Sales

from Staff for Sen. Lisa Murkowski, R-Alaska


Substantial uncertainty pervades our understanding of the mechanics, volume, and revenue associated with the terrorist group’s black market petroleum operations.Inconsistent methodologies, varying assumptions, and understandably questionable data account for these differences, as well as the evolving situation on the ground. This uncertainty does not in any way detract from the threat ISIS poses. Depriving ISIS of whatever dark revenue pool it generates from its sales of oil will put additional strain on an organization with little capacity to expand its oil field operations.


30) Kurdish Oil Exports and U.S. Policy

from Congressional Research Service by Robert Pirog 


Negotiations between the Kurdistan Regional Government and the national government with respect to an oil law that specifies a fair division of oil receipts between the key sectarian groups in Iraq have not been successful. An agreement that all parties embraced would likely be the best result for U.S. policy as well as the various groups in Iraq, but does not appear imminent, even with a new government in Baghdad. Without an agreement on a division of receipts, the KRG must either export oil via pipeline to Ceyhan or cease producing oil. There is currently no alternative pipeline transportation route available other than the Iraq-Turkey pipeline. With funding from the NG cut off, the pressure on the KRG to produce and export oil is strong. The determination of the NG to prevent those exports through the Iraq-Turkey pipeline also appears to be strong. Any entity that involves itself with KRG oil exports is open to legal action instituted by the NG of Iraq. 


31) The effect of natural gas supply on US renewable energy and CO2 emissions

from IOP Science


Increased use of natural gas has been promoted as a means of decarbonizing the US power sector, because of superior generator efficiency and lower CO2 emissions per unit of electricity than coal. We model the effect of different gas supplies on the US power sector and greenhouse gas (GHG) emissions. Across a range of climate policies, we find that abundant natural gas decreases use of both coal and renewable energy technologies in the future.