CEO of Major Shale Oil Company 'Has Second Thoughts' on Fracking Rush
By Sharon Kelly
On Monday, The Wall Street Journal featured a profile of Scott Sheffield, CEO of Pioneer Natural Resources, whose company is known among investors for its emphasis on drawing oil and gas from the Permian Basin in Texas using horizontal drilling and hydraulic fracturing, or fracking.
Back in 2014, Sheffield told Forbes that he expected Pioneer could produce a million barrels of oil a day from the Permian basin by 2024 – up from 45,000 barrels a day in 2011.
Now, Sheffield, who left the helm of Pioneer in 2016 and returned this February, says that those million-barrel-a-day plans are looking increasingly doubtful as the industry has struggled to prove to investors that it's capable not only of producing enormous volumes of oil and gas, but that it can do so while booking profits rather than losses.
"We lost the growth investors," Sheffield told the Journal. "Now we've got to attract a whole other set of investors."
Doubts on Shale Gas and Shale Oil
Mr. Sheffield's comments on the shale oil industry's fiscal difficulties come on the heels of a warning from the former CEO of the country's largest natural gas producer about the shale gas industry's financial distress.
Steve Schlotterbeck, former CEO of America's largest producer of natural gas, described the impact of over a decade of fracking on Marcellus shale drilling companies at a recent petrochemical industry conference.
"In a little more than a decade, most of these companies just destroyed a very large percentage of their companies' value that they had at the beginning of the shale revolution," he said, in remarks reported by DeSmog on Sunday. "Excluding capital, the big eight basin producers have destroyed on average 80 percent of the value of their companies since the beginning of the shale revolution."
Doubts about the shale drilling industry's financial prospects have simmered nearly as long as the industry has been producing oil and gas. "There is undoubtedly a vast amount of gas in the formations," The New York Times reported in 2011, citing concerns among industry insiders dating back to 2009. "The question remains how affordably it can be extracted."
In the years since, shale drillers churned out massive volumes of fossil fuels, first shale gas then shale oil, pushing American oil production up 12 million barrels a day, according to Energy Information Administration figures cited by The Journal.
At the same time, they have spent hundreds of billions of dollars more than they've earned from selling the fossil fuels they drew from the ground.
"Over the past 10 years, 40 of the largest independent oil and gas producers collectively spent roughly $200 billion more than they took in from operations, according to a Wall Street Journal analysis of data from financial-information firm FactSet," the Journal reported. "During that time, a broad index of U.S. oil-and-gas companies fell roughly 10%, while the S&P500 index nearly tripled."
Schlotterbeck, the former CEO of EQT who now serves on the board of directors for the Energy Innovation Center Institute which offers training for workers in the oil and gas, solar, and construction trades, offered his view of the end results for investors at the petrochemical industry conference on Friday.
"The fact is that every time they put the drill bit to the ground, they erode the value of the billions of dollars of previous investments they have made," he said in his presentation. "It's frankly no wonder that their equity valuations continue to fall dramatically."
Belt-Tightening Comes Amid Regulations Rollbacks
Sheffield's own company has a rocky track record when it comes to translating production into profits.
"In August 2015, Mr. Sheffield said Pioneer's wells were expected to yield 45% to 60% returns on investment at the oil prices at that time, excluding costs such as administrative expenses and taxes. The company lost $218 million in the second quarter of that year," the Journal reported.
"The company acknowledged that capital spending exceeded operating cash flow in 2015, but said it is focused on changing that in 2019 and beyond," it continued.
The industry's financial troubles have caused drillers like Devon Energy to begin layoffs.
So too, is Pioneer.
"Among those who are leaving is Mr. Sheffield's own brother, Thomas Sheffield, the company's vice president of health, safety and environment," the Journal reported in its Monday profile.
That belt-tightening comes as the Trump administration has pushed to roll back federal environmental regulations.
More than 80 regulations and rules written to protect the environment have either been rolled back on Mr. Trump's watch or are in the midst of rollbacks, according to a tracker published by The New York Times.
Eighteen of those rules applied specifically to "drilling and extraction," the Times observed, and others affect the drilling industry, like the scrapping of methane emission reporting requirements for drillers and rules aimed at curbing methane leaks on public lands.
Timothy Dove, who helmed Pioneer from 2016 until February, had predicted the company could grow its fossil fuel production at least 15% a year while cutting cost overruns.
But those projections drew pushback from company insiders, the Journal reported.
"Several times in recent years, technical staffers raised concerns to management that Pioneer was being too aggressive with how it talked up its prospects to investors and potential business partners, according to people familiar with the matter," the Journal reported. "In one of those instances, the company eventually walked back internal production forecasts for some of its wells in the Permian, according to one of the people. In other instances, Pioneer continued to use what some of the people said were overly optimistic estimates."
The following year, Pioneer spent $549 million more than it earned from selling fossil fuels, the Journal reported, adding that oil prices had climbed $10 higher than the $55 a barrel that Dove had said would allow Pioneer to raise production while matching spending and earnings. Sheffield told the Journal that Pioneer's board of directors had been surprised to learn that the company's management had gone $350 million over the board's approved $500 million 2018 budget hike.
Mr. Sheffield told the Journal he was backing away from million barrel-a-day plans for Pioneer. But he also maintained it would be technically possible to produce at that rate, economics aside.
"But my point is the rock will produce over one million barrels a day," he told the Journal.
Few observers would doubt that drillers can produce vast amounts of fossil fuels from shale, given the industry's history of rapidly increasing production.
An unsettled question remains, however — as it has since the early days of the shale rush — at what cost?
Reposted with permission from our media associate DeSmogBlog.
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By James Shulmeister
Climate Explained is a collaboration between The Conversation, Stuff and the New Zealand Science Media Centre to answer your questions about climate change.
If you have a question you'd like an expert to answer, please send it to firstname.lastname@example.org
What was the climate and sea level like at times in Earth’s history when carbon dioxide in the atmosphere was at 400ppm?<p>The last time global carbon dioxide levels were consistently at or above 400 parts per million (ppm) was around <a href="https://www.nature.com/articles/nature14145" target="_blank">four million years ago</a> during a geological period known as the <a href="http://www.geologypage.com/2014/05/pliocene-epoch.html" target="_blank">Pliocene Era</a> (between 5.3 million and 2.6 million years ago). The world was about 3℃ warmer and sea levels were higher than today.</p><p>We know how much carbon dioxide the atmosphere contained in the past by studying ice cores from Greenland and Antarctica. As compacted snow gradually changes to ice, it traps air in bubbles that contain <a href="https://www.cambridge.org/core/journals/annals-of-glaciology/article/enclosure-of-air-during-metamorphosis-of-dry-firn-to-ice/09D9C60A8DA412D16645E6E6ABC1892F" target="_blank">samples of the atmosphere at the time</a>. We can sample ice cores to reconstruct past concentrations of carbon dioxide, but this record only takes us back about a million years.</p><p>Beyond a million years, we don't have any direct measurements of the composition of ancient atmospheres, but we can use several methods to estimate past levels of carbon dioxide. One method uses the relationship between plant pores, known as stomata, that regulate gas exchange in and out of the plant. The density of these stomata is <a href="https://journals.sagepub.com/doi/abs/10.1177/095968369200200109" target="_blank">related to atmospheric carbon dioxide</a>, and fossil plants are a good indicator of concentrations in the past.</p><p>Another technique is to examine sediment cores from the ocean floor. The sediments build up year after year as the bodies and shells of dead plankton and other organisms rain down on the seafloor. We can use isotopes (chemically identical atoms that differ only in atomic weight) of boron taken from the shells of the dead plankton to reconstruct changes in the acidity of seawater. From this we can work out the level of carbon dioxide in the ocean.</p><p>The data from four-million-year-old sediments suggest that <a href="https://agupubs.onlinelibrary.wiley.com/doi/full/10.1029/2010PA002055" target="_blank">carbon dioxide was at 400ppm back then</a>.</p>
Sea Levels and Changes in Antarctica<p>During colder periods in Earth's history, ice caps and glaciers grow and sea levels drop. In the recent geological past, during the most recent ice age about 20,000 years ago, sea levels were at least <a href="https://science.sciencemag.org/content/292/5517/679.abstract" target="_blank">120 meters lower</a> than they are today.</p><p><span></span>Sea-level changes are calculated from changes in isotopes of oxygen in the shells of marine organisms. For the Pliocene Era, <a href="https://agupubs.onlinelibrary.wiley.com/doi/full/10.1029/2004PA001071" target="_blank">research</a> shows the sea-level change between cooler and warmer periods was around 30-40 meters and sea level was higher than today. Also during the Pliocene, we know the West Antarctic Ice Sheet was <a href="https://www.nature.com/articles/nature07867" target="_blank">significantly smaller</a> and global average temperatures were about 3℃ warmer than today. Summer temperatures in high northern latitudes were up to 14℃ warmer.</p><p>This may seem like a lot but modern observations show strong <a href="https://journals.ametsoc.org/jcli/article/23/14/3888/32547" target="_blank">polar amplification</a> of warming: a 1℃ increase at the equator may raise temperatures at the poles by 6-7℃. It is one of the reasons why Arctic sea ice is disappearing.</p>
Impacts in New Zealand and Australia<p>In the Australian region, there was no Great Barrier Reef, but there may have been <a href="https://link.springer.com/content/pdf/10.1007/BF02537376.pdf" target="_blank">smaller reefs along the northeast coast of Australia</a>. For New Zealand, the partial melting of the West Antarctic Ice Sheet is probably the most critical point.</p><p>One of the key features of New Zealand's current climate is that Antarctica is cut off from global circulation during the winter because of the big <a href="https://www.tandfonline.com/doi/abs/10.3402/tellusa.v54i5.12161" target="_blank">temperature contrast</a> between Antarctica and the Southern Ocean. When it comes back into circulation in springtime, New Zealand gets strong storms. Stormier winters and significantly warmer summers were likely in the mid-Pliocene because of a weaker polar vortex and a warmer Antarctica.</p><p>It will take more than a few years or decades of carbon dioxide concentrations at 400ppm to trigger a significant shrinking of the West Antarctic Ice Sheet. But recent studies show that <a href="http://nora.nerc.ac.uk/id/eprint/521027/" target="_blank">West Antarctica is already melting</a>.</p><p>Sea-level rise from a partial melting of West Antarctica could easily exceed a meter or more by 2100. In fact, if the whole of the West Antarctic melted it could <a href="http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.695.7239&rep=rep1&type=pdf" target="_blank">raise sea levels by about 3.5 meters</a>. Even smaller increases raise the risk of <a href="https://www.pce.parliament.nz/publications/preparing-new-zealand-for-rising-seas-certainty-and-uncertainty" target="_blank">flooding in low-lying cities</a> including Auckland, Christchurch and Wellington.</p>
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By Jo Harper
Investment in U.S. offshore wind projects are set to hit $78 billion (€69 billion) this decade, in contrast with an estimated $82 billion for U.S. offshore oil and gasoline projects, Wood Mackenzie data shows. This would be a remarkable feat only four years after the first offshore wind plant — the 30 megawatt (MW) Block Island Wind Farm off the coast of Rhode Island — started operating in U.S. waters.
Corporates Shift<p>Helping to drive offshore growth, U.S. corporate buyers <a href="https://www.dw.com/en/cities-leading-the-transition-to-renewables/a-42850621" target="_blank">are increasingly relying on wind energy to power their businesses</a>. Walmart and AT&T are the two top corporate wind buyers, while 14 newcomers entered the wind market in 2019, including Estée Lauder and McDonald's.</p><p>"Oil and gas companies have jumped into the U.S. offshore wind market, where they can transfer expertise in offshore fossil fuel development to clean energy investments," says Max Cohen, principal analyst, Americas Power & Renewable research at Wood Mackenzie. Many international oil and gas companies have already recognized this huge potential and entered the US offshore wind market, including Orsted, Equinor and Shell.</p><p>"Given the recent tumult in oil prices, fossil fuel companies may more and more be looking to diversify their portfolios, particularly with assets that are contracted or offer returns uncorrelated with oil and gas," Cohen says. "Offshore wind is an area where they may have a comparative advantage, and they can then leverage the experience with that technology to make the leap to onshore wind, solar, and other renewable technologies," he says.</p>
East Coast leads the way<p>"There is enormous opportunity, especially off the East Coast, for wind. I am very bullish," said former Interior Secretary Ryan Zinke. "Market excitement is moving towards offshore wind. I haven't seen this kind of enthusiasm from industry since the Bakken shale boom," he said.</p><p>Offshore wind initiatives require excessive upfront spending: a 250 MW venture costs about $1 billion, based on International Energy Agency data, but as costs fall the tipping point after which costs fall faster gets nearer</p><p>"The opportunity has been created by Northeastern states seeing the large price declines for offshore wind in Europe," says Cohen. Onshore wind is historically the lowest cost renewable resource, but is at its most expensive in the Northeast, he adds. "But costs are falling slower than for other technologies," he says.</p>
Jobs and Coastal Revitalization<p>U.S. wind energy now supports 120,000 US jobs and 530 domestic factories. A study by the University of Delaware predicted that the supply chain needed to build offshore turbines to feed power to seven East Coast states by 2030 would generate nearly $70 billion in economic activity and at least 40,000 full-time jobs. An American Wind Energy Association's (AWEA's) March 2020 report estimated that developing 30,000 MW of offshore wind along the East Coast could support up to 83,000 jobs and $25 billion in annual economic output by 2030.</p><p>Having said that, not all of the jobs are American jobs. The offshore wind developers with commercial leases in the US are all foreign companies. There is growing interest from the shipbuilding sector in the Gulf of Mexico in partnering with offshore wind companies to provide services. As a result, some of the US oil trade associations have submitted comments supporting certain aspects of offshore wind. "However, it is unclear to what extent offshore wind developers plan to use US vessels and crew, and the existing projects did not incorporate US vessels or labor at all," Hawkins says.</p>
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The COVID-19 pandemic has revealed both the strengths and limitations of globalization. The crisis has made people aware of how industrialized food production can be, and just how far food can travel to get to the local supermarket. There are many benefits to this system, including low prices for consumers and larger, even global, markets for producers. But there are also costs — to the environment, workers, small farmers and to a region or individual nation's food security.
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By Joe Leech
The human body comprises around 60% water.
It's commonly recommended that you drink eight 8-ounce (237-mL) glasses of water per day (the 8×8 rule).
1. Helps Maximize Physical Performance<p>If you don't stay hydrated, your physical performance can suffer.</p><p>This is particularly important during intense exercise or high heat.</p><p>Dehydration can have <a href="https://www.healthline.com/health/how-to-tell-if-youre-dehydrated" target="_blank">a noticeable effect</a> if you lose as little as 2% of your body's water content. However, it isn't uncommon for athletes to lose as much as 6–10% of their water weight via sweat.</p><p>This can lead to altered body temperature control, reduced motivation, and increased fatigue. It can also make exercise feel much more difficult, both physically and mentally.</p><p>Optimal hydration has been shown to prevent this from happening, and it may even reduce the <a href="https://www.healthline.com/health/oxidative-stress" target="_blank">oxidative stress</a> that occurs during high intensity exercise. This isn't surprising when you consider that muscle is about 80% water.<a href="https://pubmed.ncbi.nlm.nih.gov/19344695" target="_blank"><span></span></a></p><p>If you exercise intensely and tend to sweat, staying hydrated can help you perform at your absolute best.</p><p><strong>Summary</strong></p><p><strong></strong>Losing as little as 2% of your body's water content can significantly impair your physical performance.</p>
2. Significantly Affects Energy Levels and Brain Function<p>Your brain is strongly influenced by your hydration status.</p><p>Studies show that even mild dehydration, such as the loss of 1–3% of body weight, can impair many aspects of brain function.</p><p>In a study in young women, researchers found that fluid loss of 1.4% after exercise impaired both mood and concentration. It also increased the frequency of headaches.</p><p>Many members of this same research team conducted a similar study in young men. They found that fluid loss of 1.6% was detrimental to working memory and increased feelings of anxiety and fatigue.<a href="https://www.cambridge.org/core/journals/british-journal-of-nutrition/article/mild-dehydration-impairs-cognitive-performance-and-mood-of-men/3388AB36B8DF73E844C9AD19271A75BF/core-reader" target="_blank"></a></p><p>A fluid loss of 1–3% equals about 1.5–4.5 pounds (0.5–2 kg) of body weight loss for a person weighing 150 pounds (68 kg). This can easily occur through normal daily activities, let alone during exercise or high heat.</p><p>Many other studies, with subjects ranging from <a href="https://www.healthline.com/health/parenting/signs-of-dehydration-in-toddlers" target="_blank">children</a> to <a href="https://www.healthline.com/health/symptoms-of-dehydration-in-elderly" target="_blank">older adults</a>, have shown that mild dehydration can impair mood, memory, and brain performance.</p><p><strong>Summary</strong></p><p><strong></strong>Mild dehydration (fluid loss of 1–3%) can impair energy levels, impair mood, and lead to major reductions in memory and brain performance.</p>
3. May Help Prevent and Treat Headaches<p>Dehydration can trigger <a href="https://www.healthline.com/health/dehydration-headache" target="_blank">headaches</a> and migraine in some individuals.<span></span></p><p>Research has shown that a headache is one of the most common symptoms of dehydration. For example, a study in 393 people found that 40% of the participants experienced a headache as a result of dehydration.</p><p>What's more, some studies have shown that drinking water can help relieve headaches in those who experience frequent headaches.</p><p>A study in 102 men found that drinking an additional 50.7 ounces (1.5 liters) of water per day resulted in significant improvements on the Migraine-Specific Quality of Life scale, a scoring system for <a href="https://www.healthline.com/health/migraine-symptoms" target="_blank">migraine symptoms</a>.<a href="https://academic.oup.com/fampra/article/29/4/370/492787" target="_blank"></a></p><p>Plus, 47% of the men who drank more water reported headache improvement, while only 25% of the men in the control group reported this effect.<a href="https://academic.oup.com/fampra/article/29/4/370/492787" target="_blank"></a></p><p>However, not all studies agree, and researchers have concluded that because of the lack of high quality studies, more research is needed to confirm how increasing hydration may help improve headache symptoms and decrease headache frequency.<a href="https://pubmed.ncbi.nlm.nih.gov/26200171" target="_blank"></a></p><p><strong>Summary</strong></p><p><strong></strong>Drinking water may help reduce headaches and headache symptoms. However, more high quality research is needed to confirm this potential benefit.</p>
4. May Help Relieve Constipation<p><a href="https://www.healthline.com/health/constipation" target="_blank">Constipation</a> is a common problem that's characterized by infrequent bowel movements and difficulty passing stool.</p><p>Increasing fluid intake is often recommended as a part of the treatment protocol, and there's some evidence to back this up.</p><p>Low water consumption appears to be a risk factor for constipation in both younger and older individuals.</p><p>Increasing hydration may help decrease constipation.</p><p><a href="https://www.healthline.com/nutrition/mineral-water-benefits" target="_blank">Mineral water</a> may be a particularly beneficial beverage for those with constipation.</p><p>Studies have shown that mineral water that's rich in magnesium and sodium improves bowel movement frequency and consistency in people with constipation.<a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC5334415" target="_blank"></a></p><p><strong>Summary</strong></p><p><strong></strong>Drinking plenty of water may help prevent and relieve constipation, especially in people who generally don't drink enough water.</p>
5. May Help Treat Kidney Stones<p>Urinary stones are painful clumps of mineral crystal that form in the urinary system.</p><p>The most common form is <a href="https://www.healthline.com/health/kidney-stones" target="_blank">kidney stones</a>, which form in the kidneys.</p><p>There's limited evidence that water intake can help prevent recurrence in people who have previously gotten kidney stones.<a href="https://www.cochranelibrary.com/cdsr/doi/10.1002/14651858.CD004292.pub3/full" target="_blank"></a></p><p>Higher fluid intake increases the volume of urine passing through the kidneys. This dilutes the concentration of minerals, so they're less likely to crystallize and form clumps.</p><p>Water may also help prevent the initial formation of stones, but studies are required to confirm this.</p><p><strong>Summary</strong></p><p><strong></strong>Increased water intake appears to decrease the risk of kidney stone formation.</p>
6. Helps Prevent Hangovers<p>A hangover refers to the unpleasant symptoms experienced after drinking <a href="https://www.healthline.com/nutrition/alcohol-good-or-bad" target="_blank">alcohol</a>.</p><p>Alcohol is a diuretic, so it makes you lose more water than you take in. This can lead to dehydration.</p><p>Although dehydration isn't the main cause of hangovers, it can cause symptoms like thirst, fatigue, headache, and dry mouth.</p><p>Good ways <a href="https://www.healthline.com/nutrition/7-ways-to-prevent-a-hangover" target="_blank">to reduce hangovers</a> are to drink a glass of water between drinks and have at least one big glass of water before going to bed.</p><p><strong>Summary</strong></p><p><strong></strong>Hangovers are partly caused by dehydration, and drinking water can help reduce some of the main symptoms of hangovers.</p>
7. Can Aid Weight Loss<p>Drinking plenty of water can help you <a href="https://www.healthline.com/nutrition/how-to-lose-weight-as-fast-as-possible/" target="_blank">lose weight</a>.</p><p>This is because water can increase satiety and boost your metabolic rate.</p><p>Some evidence suggests that increasing water intake can promote weight loss by slightly increasing your metabolism, which can increase the number of calories you burn on a daily basis.</p><p>A 2013 study in 50 young women with overweight demonstrated that drinking an additional 16.9 ounces (500 mL) of water 3 times per day before meals for 8 weeks led to significant reductions in body weight and body fat compared with their pre-study measurements.</p><p>The timing is important too. Drinking water half an hour before meals is the most effective. It can make you feel more full so that you <a href="https://www.healthline.com/nutrition/35-ways-to-cut-calories" target="_blank">eat fewer calories</a>.</p><p>In one study, dieters who drank 16.9 ounces (0.5 liters) of water before meals lost 44% more weight over a period of 12 weeks than dieters who didn't drink water before meals.</p>
The Bottom Line<p>Even mild dehydration can affect you mentally and physically.</p><p>Make sure that you <a href="https://www.healthline.com/nutrition/how-much-water-should-you-drink-per-day" target="_blank">get enough water each day</a>, whether your personal goal is 64 ounces (1.9 liters) or a different amount. It's one of the best things you can do for your overall health.</p>
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By Michael Svoboda
The enduring pandemic will make conventional forms of travel difficult if not impossible this summer. As a result, many will consider virtual alternatives for their vacations, including one of the oldest forms of virtual reality – books.
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As the North Atlantic right whale was placed on the International Union for Conservation of Nature's list of critically endangered species Thursday, environmental protection groups accusing the U.S. government of bowing to fishing and fossil fuel industry pressure to downplay the threat and failing to enact common-sense restrictions to protect the animals.
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