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natural gas production

Balow, Other State Superintendents Ask Biden to Reconsider Energy Lockdown

in Energy/News/Education
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By Ellen Fike, Cowboy State Daily

Wyoming Superintendent of Public Instruction Jillian Balow has joined four other western state school superintendents in asking President Joe Biden to reconsider his recent energy lockdown.

Balow was joined by her colleagues from North Dakota, Montana, Alaska and Utah in sending a letter to the president telling him the moratorium on oil and gas leasing on federal lands would decimate school funding in their states.

“It is unusual that state education leaders would be in a position to warrant this letter,” send the letter, which was sent Wednesday. “We write to oppose the actions taken to ban oil and gas leases on federal land and to curtail production and transmission of the commodities.”

Biden issued an executive order in late January halting new oil and gas leasing on federal land to allow the Department of Interior to conduct a comprehensive review of the federal leasing program and existing fossil fuel leases.

But the school chiefs noted that in their states, schools depend on income from energy production.

“As state education chiefs we have appreciated generous access to your education transition team and we had multiple opportunities to discuss schools safely reopening, student well-being, and academic priorities,” the letter said. “It is imperative that we bring to light the arbitrary and inequitable move to shut down oil and gas production on federal lands in our states that depend on revenues from various taxes, royalties, disbursements, and lease payments to fund our schools, community infrastructure and public services.”

The letter specifically noted that in Wyoming, the oil and natural gas industry contributed $740 million in K-12 education funding and $28 million to the state’s higher education system in 2019.

Almost all, 92%, of Wyoming’s natural gas comes from federal lands, as does 51% of the oil produced in the state.

“The ban translates into the loss of hundreds of millions of dollars for education and 13,300 direct jobs in a state of 500,000,” the letter said.

For Montana, $30 million in revenue and more than 3,000 jobs are at risk because of the moratorium, the letter said.

In North Dakota, the lease moratorium would result in 13,000 lost jobs over four years, along with $600 million in lost tax revenue and a $750 million loss in personal income. North Dakota’s oil and gas industry accounts for 24,000 direct jobs in the state.

In Utah, $72 million in revenue and 11,000 jobs are at stake. 

In Alaska, over $24 million in state revenue is tied to federal leases for oil and natural gas, along with 3,500 jobs.

“As state education chiefs, we place equity and quality at the forefront of policy making,” the letter said. “We care deeply about clean air and clean water for future generations. And, we advocate fiercely for adequate funding for all students in all schools. Reform of the industry is necessary and can be accomplished, but not by abruptly restricting industries that define our culture and the generate revenue on which so many rely.” 

A University of Wyoming study commissioned by the Legislature concluded that a moratorium on oil and gas leasing on federal land could reduce Wyoming’s production by $872 million per year, costing the state more than $300 million a year in tax revenue.

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Gordon Asks State Agencies To Evaluate Oil, Gas Lease Ban Impact

in Energy/News/Mark Gordon
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By Jim Angell, Cowboy State Daily

Gov. Mark Gordon is directing the state’s agencies to determine how the state will be affected by a ban on oil and gas leasing on federal land and help him plot legal strategies to battle the ban.

Gordon on Friday issued an executive order in direct response to the moratorium on oil and gas leasing on federal land put in place last week by President Joe Biden in his own executive order.

“These orders issued by the new administration are a direct attack on Wyoming and our way of life, Gordon said in a statement. “I am directing members of my cabinet to examine the economic, financial and workforce impacts of the President’s actions. I will continue to fight these misguided and destructive policies by all means necessary. The way to move America forward is not through crushing her Western states.”

On his first day in office, Biden halted oil and gas leases on federal land for 60 days. Last week, he issued a second executive order on the subject extending the moratorium for an unspecified amount of time to allow the Department of Interior to thoroughly review the federal leasing program and existing leases on federal lands.

Gordon’s executive order directs state agencies to determine how their budgets will be affected by the ban and how jobs in the oil and gas industry in Wyoming will be affected.

It also directs the agencies to identify any tools that could be used to challenge Biden’s executive order, along with opportunities for litigation “to protect and preserve the strength, vitality and independence of Wyoming’s energy industry.”

The executive order does not contain a timeline as to when the governor should receive the information.

“We will be communicating with the impacted state agencies over the next several days regarding this,” said Michael Pearlman, a spokesman for the governor’s office.

A University of Wyoming study commissioned by the Legislature has concluded that a moratorium on oil and gas leasing on federal land could reduce Wyoming’s production by $872 million per year, costing the state more than $300 million a year in tax revenue.

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Wyoming Delegation Proposes Bills To Halt Biden Lease Moratorium

in Energy/News/Cynthia Lummis
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By Jim Angell, Cowboy State Daily

Members of Wyoming’s congressional delegation have introduced legislation aimed at stopping the Biden administration’s efforts to halt mineral leasing on federal land.

U.S. Sen. Cynthia Lummis and U.S. Rep. Liz Cheney, have both introduced legislation that would require congressional approval for any executive branch effort to stop energy or mineral leasing and permitting on federal land.

Lummis’ bill, co-sponsored by U.S. Sen. John Barrasso and 24 other members of the Senate, is called the “Protecting Our Wealth of Energy Resources Act” and would require congressional approval for mineral and energy leases on federal land.

Cheney actually introduced two bills, one dealing with oil and gas leases and the second with coal leases. Both would require a joint resolution from Congress to approve any moratorium on leasing on federal land.

Cheney’s bill on oil and gas leases is co-sponsored by 21 other representatives, while her bill on coal leases is co-sponsored by 14 others.

The bills were introduced in response to President Joe Biden’s executive order on Wednesday halting all mineral leases on federal land until the Department of Interior can conduct a thorough review of federal leasing programs.

“The Biden Ban would be nothing short of catastrophic for western states that are already reeling from the decline in energy usage brought on by the pandemic and continued volatility in energy markets,” Lummis said in a statement. “Through the POWER Act, Congress would reiterate that federal lands should serve not the whims of a radical progressive minority, but the needs of all Americans.” 

“The executive actions from the Biden Administration banning new leasing and permitting on federal land endanger our economy and threaten our national security,” Cheney said. “The legislation I am introducing today would safeguard against these damaging orders, and prevent the job loss, higher energy costs, and loss of revenue that promises to come with them.”

Gov. Mark Gordon expressed support for all three measures, citing the economic impacts of a long-term moratorium on mineral leases on federal lands.

“Oil and gas industries across the West are hit hard by the Biden administration’s executive action — eight western states … could lose $8 billion in (gross domestic product) and over $2 billion in tax revenue per year,” he said. “This is a bipartisan issue.“

Since federal laws provide for the leasing of fossil fuels and minerals, it is appropriate that Congress would have to agree to such a departure from the intent of federal law,” he continued. “It is disappointing that such a law is necessary, but it is.”

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Gordon Launching Oil, Gas Economic Recovery Program This Week

in News/Mark Gordon/Economy
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By Ellen Fike, Cowboy State Daily

Gov. Mark Gordon is launching a program this week that is designed to help with Wyoming’s economic recovery and to boost employment in the oil and gas industry.

The Energy Rebound Program will utilize up to $15 million in CARES Act funding to provide business relief targeted towards drilled, but uncompleted oil and gas wells, wells that were unable to be recompleted and plugging and abandonment projects which could not be finished due to the impacts of the coronavirus pandemic.

“When global demand for oil plummeted due to COVID, work stopped almost immediately in the oil and gas industry in Wyoming,” Gordon said. “This program is tailored to provide opportunities for employees who lost jobs when drilling ceased.”

The program will reimburse operators for work done on completions, recompletions, workovers or plugging and abandonments before Dec. 30, up to $500,000 per project.

Operators who were unable to perform or finish projects in these categories for wells they operate due to the effects of the virus, and who can spend funds before Dec. 30, are encouraged to apply.

The Wyoming Business Council will start accepting applications at 10 a.m. on Wednesday. Applications will be accepted through 10 a.m. on Nov. 23rd.

Operators are encouraged to start preparing information for the application, including basic well data, type of project (completion, recompletion/workover or P&A), estimated start and end dates of projects, estimated production, costs of projects and other information.

Priority will be given to projects that provide the greatest immediate economic and employment benefit to Wyoming.

Other factors include, but are not limited to: estimated time of start and completion of the project; completeness of the application; estimated amount of increased production of oil and gas; and ability to commence P&A projects in a timely manner.

“We recognize this is a short window for applications, however, these funds are for projects that were planned, but could not be completed due to the effects of COVID-19. Companies who were ready to roll last March should have the information in hand. We will maximize the impact these dollars have on restoring economic and employment opportunities in Wyoming” said Randall Luthi, Chief Energy Advisor to Governor Gordon.

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Wyoming helium production helps keep world supply afloat

in News
Helium shortage
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By James Chilton, Cowboy State Daily

CHEYENNE – Helium may be the second-lightest element, but it’s weighing heavily on a lot of minds these days as the world struggles with its third global shortage in just 14 years.

It’s gotten bad enough that, when party supply superstore Party City announced earlier this month it plans to shutter 45 of its 870 stores in the U.S., many outlets pointed to helium as the culprit. Party City has since said the closures are unrelated to the helium shortage, but it has acknowledged that some stores have had trouble fulfilling balloon orders due to inconsistent helium supplies, and it hopes to have a new commercial supplier in place by the summer.

It may not be the first thing that springs to mind when thinking of Wyoming, but the Cowboy State plays a key role in keeping the helium supply chain afloat, providing up to 30 percent of the world’s supply.

While most people probably know helium best for its role in the party balloon business, or for the funny way it raises the pitch of your voice, it’s actually one of the most critically important elements on the planet. In fact, helium is one of 35 mineral materials considered essential to U.S. national economic and security interests, as recently defined by the Department of the Interior.

That’s because, aside from making balloons and blimps float, helium has many important uses in the technology sector.

With the lowest boiling point of any element at -452 degrees Fahrenheit, liquid helium is used as a coolant for magnets in MRI machines and for research operations like Europe’s Large Hadron Collider particle accelerator. Because it’s light and nonreactive, it’s also used as a shielding gas in arc welding, and it’s added to air tanks to make it easier for lungs to take in oxygen during deep ocean dives.

“It’s almost too valuable to fill party balloons with,” said Scott Quillinan, the director of research at UW’s School of Energy Resources.

But while it makes up about a quarter of all the matter in the universe, helium is surprisingly hard to come by on Earth. The name is a bit of a giveaway – helium was named for the Greek sun god Helios, since it was first detected not on Earth, but as part of the sun’s spectral light signature, caught during a solar eclipse in 1868.

On Earth, it makes up just 0.0005 percent of the air we breathe, and while other important gases like hydrogen and oxygen can be easily separated from more complex molecules, helium is notoriously stable and doesn’t combine with other elements.

That leaves just one primary source for helium on Earth: deep within the ground. As radioactive elements like uranium and thorium break down, they throw off helium atoms that then become trapped in natural gas formations.

“There are competing hypotheses as to why there is even helium in natural gas anywhere,” said geologist Ranie Lynds, the manager of the Wyoming State Geological Survey’s Energy & Mineral Resources division. “Some people have it as being mantle-driven, coming from a lot deeper in the earth, and because it’s so light it’s able to make its way up to the surface where it’s stored with natural gas.”

“Other people have argued it forms more from uranium and thorium decay in sedimentary rocks, then it’s moved along with water through these systems,” Lynds added.

Regardless of how it got there, there’s still not much to go around – helium comprises less than 0.3 percent of most commercial natural gas deposits. But in a handful of places those concentrations rise to as high as 8 percent, making helium extraction economically viable.

In Wyoming, all the state’s commercially-produced helium comes from the LaBarge field in western Sublette County. Natural gas extracted from LaBarge is piped down to ExxonMobil’s Shute Creek natural gas processing plant in eastern Lincoln County, where the helium is separated out from other gases like methane and carbon dioxide.

“The CO2 is sold for enhanced oil recovery opportunities and the methane is used for natural gas sales,” Quillinan said. “The helium concentration is only about 0.6 percent of the gas that comes out, but there’s not many places in the world where you can find helium, so even at those low percentages, it becomes economic to produce.”

 Quillinan noted that helium has to be cooled to almost absolute zero – the lowest physically-possible temperature – in order to be liquefied for storage and shipment. And even then, helium’s ultra-light nature makes it hard to keep contained. Once it’s gone, it’s gone for good, since even Earth’s gravity isn’t enough to keep it from just floating off into space.

“It can be very difficult to handle,” Quillinan said. “I’m an isotope geochemist, and one problem with even sampling isotopes of helium is you can’t use glass containers, because it’ll just slip through the glass.”

 The hassle is more than worth it, however. At least ExxonMobil seems to think so: figures published in 2014 in the scientific journal “Minerals” show that Wyoming accounted for 43 percent of U.S. helium production and 31 percent of global production from 2000 to 2012.

 “Looking at the numbers for 2012 specifically, Wyoming does top the list, then very close behind it is Kansas, followed by Texas, then Colorado and Oklahoma,” Lynds said. “Right now there’s pretty significant production in Wyoming and I would expect that to continue.”

In January, Wyoming State Geologist Erin Campbell wrote that, along with uranium, helium has some of the best development potential of any mineral material in the state. In addition to the known supplies at LaBarge and elsewhere in southwest Wyoming, Campbell said the WSGS “estimates 14.78 billion cubic feet of marginally economic and subeconomic helium resources exist … in the Greater Green River, Wind River, Powder River, and Bighorn basins and the western Wyoming thrust belt.”

But while those untapped resources may one day help to meet global demand for the gas, industry experts expect the current shortage will likely last through the remainder of this year, unless either demand starts dropping or until other large-scale helium projects in Qatar and Russia come online in 2020 and beyond.

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