Tag Archives: hydrocarbon production

Debunking Dr. Bossel’s Anti-Hydrogen Thesis

Proliferation of clean energy solutions like hydrogen infrastructure and fuel cell manufacturing are held back by myths that need to be busted.   In this article RMP will use common sense,  simple examples, and data to dispel an argument that hydrogen production, storage, and distribution is not economical because it’s less efficient than storing energy in a battery. Many people still peddle and cling to this red herring argument as if it makes sense. That stops today. Dr. Bossel’s keyhole view of mathematics, chemistry, and physics is used as sleight of hand to mislead readers from the big picture of how energy production, storage, and grid administration really works.

dr bossel
Dr. Ulf Bossel has published many anti-hydrogen thesis statements. His papers were published between Sept 2005 & July 2008.  RMP reached out to Dr. Bossel to ask if he has amended his viewpoints published nearly 10 years ago.  Dr. Bossel did not respond to RMP’s email requests for information.

Mathematically speaking, storing electrical energy in a battery is very efficient and many times storing energy in a battery makes good common sense. Also, for the record, RMP is not anti-battery and believes that batteries are important to clean energy proliferation and RMP supports the manufacture and adoption of batteries as well as BEVs for many market segments. Yes, batteries are an important part of the Hydrogen Economy.

Dr. Ulf Bossel writes that making hydrogen from electricity is inefficient and therefore a “waste” of energy. Ironically, there are terawatt hours of electrical energy being wasted each year by not using that energy to make hydrogen.  The number of kWh wasted each year is also forecast go up as more clean renewable energy comes onto our grid. In the UK alone, according to ITM’s CEO, Dr Graham Cooley, 1TWh of electricity was curtailed in the past year that could have provided enough hydrogen to fuel 3 million cars to travel 350 miles.

Dr. Bossel’s argument goes like this: given a quantity of energy, it is more efficient to store that same quantity of energy in a battery rather than to create and store that same energy as hydrogen. The diagram shown below is used widespread on the Internet as the foundation to support this red herring anti-hydrogen argument.   There is much more, however, to the story of producing hydrogen from renewable energy than a lab experiment argument that blows out like a candle in the wind in the real world. RMP will explain in this post why Dr. Bossel’s graph and thesis statement is not credible for economic consideration. Larger quantities of energy than 100 kWh used for demonstration purposes must be considered and those quantities do not extrapolate to a high-voltage electricity grid with simple math. Geography, geopolitics, climate, socio-economics, storage capacities, human usage habits, and natural resources are but a few of several more considerations that cannot be excluded for any economic analysis if it is to be credible.

dr bossel
Dr. Ulf Bossel’s diagram has been used by anti-hydrogen advocates for years and today we are demonstrating how Dr. Bossel’s argument doesn’t hold up to scientific scrutiny. If you see this diagram henceforth, please use your social media to share this post so people can read how Dr. Bossel’s thesis is not credible.

Let’s assume the math put forth in Dr. Bossel’s diagram is accurate for argument’s sake. It shows 100 kilowatt hours (kWh) generated from a renewable source will have 69 kWh of useful energy transferred to a battery and 23 kWh transferred to your tank after efficiency losses to make H2, compress H2, transport H2, and put that H2 into a fuel cell vehicle.  When you couple the simple to follow mathematical diagram with Dr. Bossel’s credentials as a fuel cell consultant, certain media outlets will use his published papers to underpin their arguments to say hydrogen cannot be produced economically.

Bloggers like Fred Lambert who’s Editor in Chief for the Tesla fan site Electrek and Zachary Shahan who’s Director & Chief Editor for the Tesla fan site Clean Technica are more than happy to publish Dr. Bossel’s work to support their anti-hydrogen view points. Websites like Electrek and CleanTechnica attempt to use Dr. Bossell’s lab science as credible information that can be used to write energy and economics policy outside of laboratory parameters.  Fred Lambert posted this article using Dr. Bossel’s diagram on the same very same day I started working on this post your reading now.  Sites like Electrek & CleanTechnica are still currently publishing Dr. Bossel’s diagram to support their arguments against hydrogen fuel cells even though developments in the fuel cell industry are happening frequently each month and creating mountains of evidence refuting their false viewpoints.  Dr. Bossel’s diagram has been propagated for years since he first published it along with his supporting paper “Does a Hydrogen Economy Make Sense” in 2006.  Now eleven years later, in 2017, if any media outlet uses Dr. Bossel’s thesis to support economic science, they lose credibility.

Dr. Bossel has published the same work explaining his thesis against the Hydrogen Economy in several different years and places but in this particular publication served by the AFDC we get the following quote that disqualifies Dr. Bossel’s work in the very first paragraph:

As there are no environmental or energetic advantages in producing hydrogen from natural gas or other hydrocarbons, we do not consider this option, although hydrogen can be chemically synthesized at relative low cost

Why would you exclude the #1 method by which approx 90% of H2 is currently made in a paper that is supposed to explain how Hydrogen Economy doesn’t make economic sense? Natural gas is a major part of the fossil fuel ramp down in the Hydrogen Economy and he has already disqualified his paper from serious consideration by saying natural gas production of H2 has been excluded from his analysis. Natural gas considerations would absolutely need to be included in a paper about the Hydrogen Economy. This point is a big one because any economic analysis must include every aspect and angle possible. An economic paper cannot rely on a keyhole analysis that distracts from the bigger picture especially when the single biggest current source of H2 production is ignored.   There are other examples of where this paper gets it wrong and how it in no way can be considered relevant to understanding how the economy or a high-voltage electricity grid works.

Ford Focus BEV
Bill Hall who sits on the Board of Directors of respectmyplanet.org drives a Ford Focus BEV and he loves it. It’s ok to support batteries as well as fuel cells if you care about the environment. The Ford Focus BEV has a 33.5 kWh battery for a rated range of 115 miles. It also has a 107 MPGe rating. It’s a terrific car for someone in the right market. Other markets might be better suited for FCEVs. BEVs and FCEVs can coexist peacefully to help us responsibly migrate away from crude oil

Dr. Bossel does make some valid points in his papers about using neutral hydrocarbons from “the biosphere” as he says and converting them to liquids like methanol.  Using carbon neutral hydrocarbons to make liquids for economics of transport for longer distances (e.g. >200km) is smart.  Carbon neutral synthetic hydrocarbons like methanol and other liquid H2 carriers like ammonia are necessary to society.  Natural gas that is flared and vented in massive oil fields & landfills around the world as a waste gas or nuisance gas could be economically captured as useful methanol to create jobs and reduce GHGs.   Read this post RMP published on October 27, 2015 in our Michigan Oil & Gas Monthly magazine as part of our leading coverage of Michigan’s hydrocarbon infrastructure and how RMP supports turning carbon neutral methane into methanol.

Unfortunately Dr. Bossel’s good mathematical points in the paper are overshadowed by his myopic and narrow view of physics while ignoring other important facets of how a complex economy works. Dr. Bossel does not make a good case because he excludes too many considerations for his paper to carry merit.   Dr. Bossel’s papers have also lost relevancy given the rapid advances in renewable energy generation capacities that he lacked the foresight to see over approximately 11 years ago.  The process to increase hydrogen production from H2O has decreased in costs via many new methods of electrolysis.  More stories are being written about breakthroughs in electrolysis economics each new month since Dr. Bossel’s paper was written.  One of the most promising electrolysis & fuel cell technologies is called high temperature reversible SOFC electrolysis.

Many things have changed since since Dr. Bossel published most of his work in  2005-2008.  Dr. Bossel does not understand how our energy grid works and where waste is really occurring. Dr. Bossel’s thesis statement is that converting water to hydrogen is a wasteful use of electricity. Ironically, we often have more generating capacity than we can use or transmit and we are curtailing electricity generation that hydrogen production could easily soak up and save for cloudy and windless days.  It’s actually wasteful to not create hydrogen because so much electricity is going unemployed. RMP will drive this point home throughout this rebuttal to Dr. Bossel’s thesis and we will look at data from various sources like CAISO to support this thesis argument. Economics is a complex subject and it’s imperative that all things are considered which is where Dr. Bossel’s arguments fail.

Like a pinhole aperture on a camera blocking nearly all light for a very specific photo shot to work, Dr. Bossel’s argument is ruined if the oculus is opened even the tiniest of bits. Any sound economic argument, however, must have the aperture cranked all the way open and stand up to broad sunlight scrutiny or it is has no credibility. Having laid down the thesis of why Dr. Bossel’s anti-hydrogen argument doesn’t work, let’s look at some real world examples.

duck chart electricity demand hydrogen
This graph gets its name for its duck-like shape that follows the hour by hour net demand that reflects human needs.  Net demand is high in the morning as people turn on their coffee makers, toast their breakfast bread, and blow dry their hair before heading off to work.  As people head off to work demand drops just when solar generation capacity is highest!  Notice the demand ramp between 3PM and 9PM of nearly 11MW!   When demand is low and electricity generation is high, we could turn wasted electricity into hydrogen to be used for later.   Batteries can play a part in helping climb steep demand ramps, but for long term storage, batteries cannot match hydrogen’s economic benefits.  Click image to enlarge.  Source: CAISO.  Click here to read CAISO’s explanation of what a duck curve tells us about managing a green grid.

Producing, compressing, and storing hydrogen might seem wasteful in a laboratory analysis, but the opposite is true in the real world.  Let’s talk about electricity “curtailment”. Curtailment of carbon zero renewable electricity is when wind & solar electricity generation capacity exceeds society’s immediate needs and the grid operator does not allow that electricity onto the grid.  Terawatt hours are being wasted each year on grids around the globe because of not employing that capacity to store energy as hydrogen.  This video from fully charged explains clearly how using excess electricity for making hydrogen is a smart economic solution for citizens in Scotland’s Orkney Islands.  The Orkney Islands’ example shows a microcosm of how governance of a high voltage electric grid is helped by making hydrogen with surplus renewable electricity.

A major high-voltage electricity grid can be understood well by turning to the California ISO, hereafter CAISO.  CAISO governs the California electricity grid and California is massive.  If California was a country, it would have an economy as large as the economy of France.  CAISO is led by an experienced Board of Governors and executive management team that set policies to ensure the reliable performance of the high-voltage electricity grid, open access to participants, and a transparent, competitive market for energy. The California ISO provides open and non-discriminatory access to the bulk of the state’s wholesale transmission grid, supported by a competitive energy market and comprehensive infrastructure planning efforts. CAISO publishes this short and straightforward document that in 4 short pages explains some fast facts about renewable energy and the “Duck Chart” that is stereotypical of any major high-voltage electricity grid. Within that document is a paragraph that refutes Dr. Bossel’s thesis. On the Over Supply Mitigation section on page 3 of the document, the first  paragraph reads:

Oversupply is when all anticipated generation, including renewables, exceeds the real-time demand.  The potential for this increases as more renewable energy is added to the grid but demand for electricity does not increase. This is a concern because if the market cannot automatically manage oversupply it can lead to overgeneration, which requires manual intervention of the market to maintain reliability. During oversupply times, wholesale prices can be very low and even go negative in which generators have to pay utilities to take the energy. But the market often remedies the oversupply situation and automatically works to restore the balance between supply and demand. In almost all cases, oversupply is a manageable condition but it is not a sustainable condition over time — and this drives the need for proactive policies and actions to avoid the situation.

RMP has been publishing a similar thesis point to CAISO’s oversupply mitigation policy for years.  RMP is at its core an organization dedicated to protecting freshwater natural resources by making better use of things that are otherwise considered waste. All of that wasted electricity could be employed easily, economically, and with proven technology if it were used to convert water into hydrogen. The argument that making, compressing, and storing hydrogen is 3 times less efficient than putting that same electricity into a battery is a red herring argument plain and simple because of this.  The costs to store electricity as hydrogen are between €10 & €20 euro per kilowatt hour vs approx €600 to €800 per kilowatt hour in lithium batteries (jump to 16:05 mark).  There are tens of thousands of megawatt hours curtailed each month on California’s grid alone and RMP is predicting we will soon see over 100k megawatt hours curtailed in a single month in California.  California has so much renewable energy generation capacity being added to the grid each year the 100k MWh threshold in a single month could even be surpassed as early as 2018.  Furthermore, California is but a microcosm example of every other major high-voltage grid around the world.  Now let’s back these arguments up with data that can be verified by anyone with an Internet connection.

The California ISO keeps electricity curtailment statistics of renewable generation. Energy curtailed is wasted energy that could be put to use as stored hydrogen. As you can see in the graph, the trend is increasing amounts of wasted renewable energy each year.  The reason is more and more renewable energy coming on to the grid with relatively no change in electricity demand.  The situation as described by CAISO is “unsustainable”. Hydrogen is a great solution to store wasted electricity for grid leveling contrary to Dr. Bossel’s anti-hydrogen thesis. Click here to see the source of this graph.  Click image to enlarge.

CAISO has been keeping curtailment data records for years but has specifically started detailing curtailment increases in the past few years when renewable energy generation started rapidly integrating onto the California grid. The graph to the left depicts historical curtailment data of renewable generation since 2014 and can be accessed directly from this link. This graph demonstrates clearly the irony and opposite nature of Dr. Bossel’s incorrect thesis. If electricity is supposed to be wasted by making hydrogen, why then are we wasting so much electricity now? Dr. Bossel’s argument doesn’t make any sense, yet it has been used to mislead many people on media sites with low journalistic integrity.   Junk science is being used to mislead people against clean and sustainable hydrogen production based on emotional and incorrect information. The truth is that electricity is being wasted by not making hydrogen.  All of these wasted MWh of electricity could be turned into hydrogen to balance the grid and take pressure off of it. Furthermore, the number of curtailed MWh is trending upward which means even more wasted MWh are forecasted for the future if we don’t employ proven water to hydrogen electrolysis assets on our grids around the world. NEL hydrogen has been in the clean energy production business since 1927.   NEL has been growing their business and creating jobs to bring sustainably produced hydrogen to market for 90 years.  NEL’s contributions to a sustainable grid about are about to grow by exponential sales figures in the coming years.  Here’s a great presentation of what NEL Hydrogen does that defies Dr. Bossel’s thesis.  NEL is creating  jobs with a solution that relieves pressure on aging grids with otherwise wasted or curtailed electricity generation from renewable sources.

Thankfully CAISO has been collecting and publishing hourly usage & curtailment data for years so we can use real world data to refute phony arguments about how producing hydrogen would waste electricity. Furthermore, even if you didn’t understand much about high-voltage electricity grids, you can clearly see a trend in the graph showing the number of MWh of renewable electricity curtailed going up each year as a result of more solar and wind generation capacity coming online each year. While Dr. Bossel’s thesis statement does not extrapolate from the laboratory out to the real world at all, RMP’s thesis statement that curtailed electricity MWh will continue to go up each year can be extrapolated to every grid around the world. This phenomenon will increase as we construct more and more clean renewable electricity generation each year like wind & solar. Hydrogen can be made cheaply and in unlimited quantities wherever there is generation capacity being curtailed or wasted. While batteries can play an important part of working together with fuel cells to help in ramping flexibility so grid operators like CAISO can react quickly to changes in electricity net demand, batteries on their own are not economical for large storage that can feed electricity into the grid for days, weeks, or months when renewable generation is weak and unreliable. This is especially true in major cities north of the 40th parallel that experience long cold winters when the skies are mostly overcast for months at a time.

hydrogen electrolysers
NEL has been making clean green hydrogen since 1927 (that’s 90 years!) Today, NEL can turn water into 100 tons of hydrogen per day! That hydrogen can be stored to power cars, trucks, busses, and our grid.  The best part is that the hydrogen can be produced with electricity that would otherwise be wasted or curtailed. If you want a green grid, you should support hydrogen for situations where batteries don’t make economic sense.  Click image to enlarge.  Source NEL.

Making hydrogen from otherwise wasted electricity generation capacity takes pressure off the grid with the growth of intermittent renewables. Fast charging like Tesla’s Super Charging sites, however, are virtually all on grid, which adds pressure to the grid while also relying on transmission lines that are vulnerable to our increasingly volatile weather. If transmission is disrupted by felled power lines, so too would grid charging transportation be disrupted until power is restored. Hydrogen allows us to balance the grid as well as go off the grid because H2 fueling stations provide off grid storage.

We need to see a plan of how an anti-hydrogen activist’s grid would work that can be peer reviewed. There was a long ramp to get into our current situation with base load coal plants still burning and belching SOx, NOx, COx, Hg, & PMs into our air and water around the clock. The ramp down of fossil fuels to a fossil free society must be explained in a manner that can be peer reviewed with substantive explanations.  We need an explanation that includes numbers and support, not empty ad hominem attacks.  How are we going to decommission coal plants and replace the base load power they supply without using fuel cells? In the Hydrogen Economy, the Hydrogen Council, which is meeting in Bonn Germany in this month, just published this “Hydrogen Scaling Up” document that explains initiatives in detail and is open for peer review. The United States Department of Energy has a whole section on their website called H2@Scale explaining how the Hydrogen Economy works and is also peer reviewable public information. With so many credible sources publishing peer reviewable plans for the Hydrogen Economy, where are the plans showing a sustainable economy without hydrogen or fuel cells?

2016 Aggregate electricity generation data from the EIA shows that of 4.08 trillion kWh produced in the USA, over 30% of that production (1.24 trillion kWh) came from coal generation. There has to be a ramp to get down from where we are today. We need to see a plan from those who think a switch gets magically flipped and those 1.24 kWh of base load power are replaced. The same replacement explanation is needed to explain how natural gas (@ 1.38 trillion kWh), and nuclear (@ 803 billion kWh) would be replaced. How do you replace this generation without fuel cells? Show us the plan. If you were to cut out fossil fuel generation overnight, the effects would be devastating with a recent case & point being the island of Puerto Rico after Hurricane Maria.   As of November 13, 2017, still half of Puerto Rico’s grid remains off line. People remain in desperate need of energy in order to have clean water and to generate power for their hospitals.  In a Hydrogen Economy with a distributed grid, power outages would be less wide spread. Natural gas lines generally run underground and can feed SOFCs and PAFCs that are powerful enough to provide electricity and hot water for hospitals & hotels at upwards of 85% efficiency. Natural gas lines are much less likely to be taken out by natural disasters like above ground power lines. If you have a BEV in Puerto Rico, you might be part of 50% of the population that has not been able to charge it since September. People in Puerto Rico at the date of this publication are still desperate for gasoline to power their vehicles. These serious issues deserve serious consideration.

2016 USA total electricity generation by source from the EIA. Approx 65% of 2016 electricity in the USA came from fossil fuels. We can help ramp down fossil fuel usage and imported oil by using wasted excess electricity to make carbon zero hydrogen. Click here for data source.  Click image to enlarge.

RMP compiled data from the EIA here to make a quick graph shown at the left to demonstrate the breakdown of our USA electricity generation. Total renewable generation makes up 16.1% of all generation of 4.08 trillion kWh while approximately 65% of that generation came from fossil fuels.   Of the 16.1% generation from renewable sources, hydropower leads the way at 6.5%. Wind comes in second at 5.6% and solar registers at less than 1% !!! The notion that we switch to BEVs only and put solar panels on our roofs and we’re all done is not a credible position to have.   Using BEVs and solar panels on our rooftops is a great idea and it’s admirable to pioneers who are looking to help make the world a better place; but those efforts do not scratch the surface of the challenges we face in order to eliminate fossil fuels from our economy. We have to be much more thoughtful than that. There is no flipping a switch to get there and we need to see a thoughtful white paper from someone other than Dr. Bossel, because his thesis is not credible nor is any media outlet that uses it to support economic viewpoints.

And that’s how the debunking of Dr. Bossel’s anti-hydrogen thesis ends. RMP does not mean to pick on Dr. Bossel in a personal way but must stand up to protect the truth when someone gets the science wrong and misleads the public. Dr. Bossel has made good contributions to the science of physics and makes good points about the energy density issues of methanol and ammonia versus those of compressed or liquefied H2. To those points, RMP finds common ground with Dr. Bossel. But, where economic science is concerned, Dr. Bossel’s thesis quickly falls apart and becomes not credible.

Dr. Bossel’s failure to include natural gas in his analysis shot his argument in the foot from the very first paragraph. By failing to demonstrate knowledge of how a high-voltage electricity grid works, Dr. Bossel further disqualifies himself as a credible source.

Feel free to tell RMP where we you think we got it wrong and please leave a comment whether you support or disagree with RMP.   Click here to follow our Twitter feed and click here to like RMP on facebook.  Thanks for reading and please share this post on your social media by clicking the share links below.  If you can afford to support our Michigan based 501(c) non-profit organization in a financial way please click here to make a tax deductible donation (only deductions made in the USA are tax deductible but we would welcome international contributions too).  If you would like to join us and publish your articles right here on  RMP’s website and you can support your arguments for green energy with verifiable references, please contact RMP by leaving a comment below or writing to us at respectmyplanet@gmail.com.  We would love to publish more content that debunks junk science.  Thanks for reading.

Jordan Development’s Word of Faith 16-27 Niagaran Oil Well in Southfield, Michigan

Jordan Development’s Word Of Faith 16-27 Niagaran oil well has been completed and is flow testing as of today November 8, 2016.   By the size of that flare, it looks like this well will be a long term producer.  The well was completed in October of 2016 which means the well completion report can be FOIA requested in January of 2017.   RMP will get the initial production report and well completion reports as soon as they’re available to get the numbers, but I can tell you this much…  based on that flare, this well is going to be a long term producer.

Check out the video below and let me know what you think?   RMP feels pretty safe making the prediction this well will produce for the next 30 years and Keith Butler is going to make some $$$.   Check back to RMP on November 30, 2016 when RMP publishes our Michigan Oil & Gas Monthly magazine. On November 30, 2016 RMP will have a report on what Southfield residents can expect to see happen over the next year and next 30 years with a Niagaran oil well in such a heavily populated area.  RMP will post more pictures & videos of the Word of Faith 16-27 well on November 30, 2016 along with pictures of well pad equipment that you’re likely to see arriving in Southfield over the next couple of months if RMP speculation is correct.

Michigan Oil & Gas Monthly – October 2016

In June of 2015, the MPSC was challenged to determine the appropriate regulatory response to applications filed pursuant to R 460.867 (Rule 17) for operation of  Antrim Shale Formation (ASF) wells under vacuum on Michigan Public Service Commission Case# U-16230. RMP wrote about this story in our August 2015 MOGM.  Prior to June 2015, battles had been fought over the issue of operating ASF wells on a vacuum for years.  Administrative Law Judge Mark D. Eyster held a pre-hearing on June 15, 2010 to officially get the Continue reading Michigan Oil & Gas Monthly – October 2016

2016 Michigan Hydrocarbon Production Results January – June

It’s that time of year again to report production numbers in Michigan for oil, natural gas, and natural gas liquids for the first six months of 2016.   As stated many times here, the production data lags behind real time so we have to wait until just about this time of year to get all of the data from January to June.  After compiling the data for the first six months of 2016 we see a couple of Continue reading 2016 Michigan Hydrocarbon Production Results January – June

Michigan Oil & Gas Monthly – September 2016

Each month respectmyplanet.org (RMP) recaps oil & gas activity in the Michigan Basin right here in our Michigan Oil & Gas Monthly (MOGM) magazine.  RMP is a Michigan based 501(c)3 non-profit organization.  If you want to know what’s going on with oil & gas development in Michigan, you should follow this publication each month by liking us on facebook or following @respectmyplanet on Twitter so you don’t miss a publication.

Antrim Shale
This is a screen shot from Bill Harrison’s paper linked in this article about the location of three of the “J-style” Antrim wells targeting the Upper Devonian Lachine, Paxton, and Norwood layers of the Antrim Shale.  Delta Oil’s ACOWS targeting the same formation with multiple horizontal drainholes are closer to the county line of Montmorency & Alpena Counties.  Click image to enlarge on your screen.

In September, we  saw some interesting activity in the Michigan Basin that we will keep our eyes on as it unfolds.  Delta Oil out of Oak Brook, Illinois filed numerous ACOWS to drill multiple horizontals off of their State Avery D1-32 well (PN45601) & off of their State Albert A4-1 well (PN53617).   The ACOWS calls for a horizontal drainhole (HD) targeting the Upper Devonian Lachine formation.  The other ACOWS calls for an HD targeting the Continue reading Michigan Oil & Gas Monthly – September 2016

Michigan Oil & Gas Monthly – July 2016

This month a group calling themselves the MICATS staged a protest at Attorney General Bill Schuette’s home in Midland, Michigan.  The Detroit News has a story here.

For the record, I have never supported extremist groups or individuals like those in MICATS and neither has respectmyplanet.org.  I don’t know them, affiliate with them, or in any way condone what they did.  RMP supports as part of our stated mission the migration away from oil as an energy source.   RMP supports ending oil pipelines that traverse our Continue reading Michigan Oil & Gas Monthly – July 2016

Michigan Oil & Gas Monthly – May 2016

The big news in oil & gas this month was the Chapter 11 bankruptcy filings of Houston, Texas based Linn Energy and Los Angeles, California based Breitburn Energy Partners.   Linn energy was the 3rd largest hydrocarbon producer in Michigan in 2015 bringing in approximately $45.1 million worth of Michigan petroleum revenue. Breitburn was Michigan’s 5th biggest producer in 2015 bringing in approximately $44.0 million. Now, the questions will come about how the Chapter 11 bankruptcy restructurings will impact these companies along with their Michigan assets. RMP published a summary of the 2015 top 25 producers in the Michigan Basin last month, you can read it here.   Less than a month after publishing the top 25 producers, we learn that two of Michigan’s top five producers are bankrupt.

oil & gas bankruptcies
North American oil & gas bankruptcies filed in May of 2016.  There have been 35 oil & gas companies filing for bankruptcy protection so far in 2016.   Linn Energy is the largest by debt at $8.3 billion to file this year.  Linn Energy was the 3rd largest operator by revenue in Michigan in 2015 selling about $45.1 million of mostly dry Michigan natural gas from Michigan’s Antrim Formation. (photo source: Haynes & Boone)

Hal Washburn, Chief Executive Officer of Breitburn Energy Partners, said Continue reading Michigan Oil & Gas Monthly – May 2016

Michigan Oil & Gas Production Report January – December 2015

2015 Michigan petroleum production numbers are approximately 98% reported as of today. RMP has always focused on the numbers as they are often greater than adjectives.   Opinions are overrated.  People want to hear the numbers and then decide for themselves.   This is RMP’s fifth year studying, parsing, organizing, compiling, and reporting numbers related to Michigan petroleum production. The information RMP publishes will always be free access to the public. RMP has always followed three fundamental tenets as a research and reporting philosophy:

  • It’s all about the rock. Always respect the geology.
  • Follow the money. Money talks.
  • Follow the wastewater. Waste means inefficiency and problems. Inefficiency and problems mean additional costs. With regard to costs, see point #2.

Following the money has proven to be difficult because of the voluminous and Continue reading Michigan Oil & Gas Production Report January – December 2015

Michigan Oil & Gas Monthly – March 2016

Crickets.   New oil & gas activity in the Michigan Basin is so slow through the first quarter of 2016 that the only thing you can hear at the OOGM permitting department is crickets.  2015 was the slowest year in Michigan oil & gas history for new permitting activity breaking the old record set in 1931.   In the first three months of 2015, the slowest year in Michigan history, the Office of Oil, Gas, & Minerals (OOGM) had received 24 applications and had issued 28 permits.  As of today, through the first three months of 2016, Michigan’s OOGM has received only two applications and issued only six permits.   New oil & gas permitting activity in 2016 is on pace to set the bar substantially lower than last year’s record as the slowest year ever.

As always, however, there’s a lot going on in Michigan oil & gas even if the permitting department of the OOGM is Continue reading Michigan Oil & Gas Monthly – March 2016

Michigan Oil & Gas Monthly – February 2016

Each month, RMP publishes a detailed recap of oil & gas activity in the Michigan Basin.   This edition marks our 14th since our inaugural monthly edition was published in January of 2015. It’s time to follow up on a couple things we reported in 2015. One of the hot topics in our hometown Detroit newspapers and on our Detroit radio stations is the application for the Word of Faith 16-27 well targeting Michigan’s Silurian age Niagaran Reef. Jordan Development out of Traverse City, Michigan filed the application in October of 2015.

WordOfFaithOilWellComment1
This is an example of the bolierplate used by many of the people who submitted a comment in favor of the Word of Faith 16-27 well being permitted for drilling.  Click to enlarge.

What makes the Word of Faith 16-27 oil well different than many other potential Michigan wells is that it’s within the city limits of Southfield, which has a population of nearly 75,000 people. Often times when an application is received for a well in a heavily populated Metro Detroit city, the MDEQ’s OOGM will extend the application review process to hear comments from the public. The MDEQ has sole legal authority to permit any Michigan oil well regardless of symbolic gestures like a moratorium enacted by the Southfield City Council in effect until April 28, 2016. Only a court ordered injunction via lawsuit can Continue reading Michigan Oil & Gas Monthly – February 2016