Las deudas pueden comerse al mercado de shale en USA

La Industria de Shale podrían tragarse su propia deuda
por Asjylyn Loder - Bloomberg



Un pozo de bomba cerca de Sweetwater, Texas. Fotógrafo: LM Otero / Foto AP

La deuda que alimentó el boom de shale en EE.UU. ahora amenaza con ser su perdición.
Los perforadores están dedicando más ingresos que nunca para el pago de intereses. En un ejemplo, Continental Resources Inc., la empresa atribuye la fabricación de Dakota del Norte Bakken Shale una de las mayores regiones productoras de petróleo del mundo, pasó casi tanto como Exxon Mobil Corp., una compañía de 20 veces su tamaño.
La carga se está convirtiendo en más pesado después de los precios del petróleo cayeron 43 por ciento en el último año. Los pagos de intereses se están comiendo más del 10 por ciento de los ingresos para 27 de los 62 perforadores en el Índice de América del Norte Exploración y Producción Independiente Bloomberg Inteligencia, frente a una docena de hace un año. Los perforadores deuda 'se disparó a 235 mil millones dólares al final del primer trimestre, un aumento del 16 por ciento en el último año, así como los ingresos se redujo.
"La pregunta es, ¿cuánto tiempo tienen que pueden salirse con la suya", dijo Thomas Watters, analista de crédito de petróleo y gas de Standard & Poor 's en Nueva York. Las empresas con las calificaciones crediticias más bajas "están en modo de supervivencia", dijo.
El problema para los perforadores de esquisto es que han gastado consistentemente dinero más rápido que ellos han hecho, incluso cuando el petróleo era de 100 dólares por barril. Las empresas en el índice Bloomberg gastaron $ 4,15 por cada dólar ganado la venta de petróleo y gas en el primer trimestre, frente a los 2,25 dólares del año anterior, mientras empuja la producción de petróleo de Estados Unidos para el más alto en más de 30 años.
"Hay un problema de liquidez, y se empieza a observar la quema de efectivo", dijo Watters.

Deuda apenada

Continental pide prestado a tasas más baratas que muchos de sus compañeros más pequeños, ya que su deuda es de grado de inversión. S & P asigna especulativa o chatarra, las calificaciones a 45 de las 62 empresas en el índice Bloomberg.
"Nuestro flujo de caja cubre fácilmente los costos de interés, y esperamos seguir manteniendo nuestra calificación crediticia de grado de inversión como los precios de los productos básicos se recuperen", dijo Warren Henry, portavoz de Continental con sede en la ciudad de Oklahoma.
Casi $ 20 mil millones en bonos emitidos por las 62 compañías están negociando a niveles en dificultades, con rendimientos de más de 10 puntos porcentuales por encima de los bonos del Tesoro, ya que los inversores exigen tasas mucho más altas para compensar el riesgo de que no se pagarán las obligaciones, según datos compilados por Bloomberg espectáculo.
"Los mercados de crédito han desempeñado un gran papel en el mantenimiento de todo el sector con vida", dijo Amrita Sen, analista de petróleo en aspectos energéticos Ltd., una firma de consultoría en Londres.
En lo que va de este año, el S & P rebajó la perspectiva o degradó el crédito de casi la mitad de los 105 estadounidenses de exploración y producción las empresas que las tasas, según un informe de mayo.

Drenaje financiero

Las empresas han reducido el gasto para hacer frente a los precios más bajos, pero esos recortes eventualmente conducir a la producción disminuye, reduciendo aún más los ingresos, dijo Watters.
West Texas Intermediate, el grado de referencia de Estados Unidos, perdió 11 centavos 60,34 dólares el barril en la contratación electrónica de la Bolsa Mercantil de Nueva York a las 1:04 pm, hora de Singapur el viernes.
La producción de petróleo de Estados Unidos comenzará a caer este mes y continuará hasta principios de 2016 deslice como perforadores de esquisto reducir el gasto, dijo la Administración de Información de Energía en un informe 09 de junio.
Los gastos por intereses puede drenar las finanzas de la empresa. En esta época el año pasado, Quicksilver Resources Inc. estaba gastando más del 20 por ciento de sus ingresos en intereses. La compañía perdió un pago de la deuda en febrero y desde entonces se ha declarado en bancarrota. Sabine Petróleo y Gas LLC perdió un pago de intereses en abril y otra este mes.
Representantes de Fort Worth, Quicksilver con sede en Texas y Sabine, con sede en Denver, no devolvieron las llamadas o correos electrónicos en busca de comentarios. Las acciones de Sabine cayeron un 96 por ciento en el último año a 8,5 centavos de dólar, y sus bonos se cotizan por menos de 23 centavos de dólar.

Defaults corporativos

Las compañías de petróleo y gas representaron un tercio de los 36 incumplimientos de deuda corporativa en todo el mundo este año, y se perdió los pagos de intereses son la principal causa de incumplimiento, de acuerdo con un informe de S & P del 14 de mayo. Compañías como Duna Energy Inc., BreitBurn Energy Partners LP y Halcon Resources Corp. han planteado en efectivo al asumir nueva deuda o emisión de nuevas acciones.
La nueva deuda emitida por Halcon y Duna está garantizado por los activos de petróleo y gas, por lo que es menos probable que los tenedores de bonos no garantizados conseguirán reembolsado en un defecto. Mayores, bonos sin garantía de ambas compañías se cotizan a niveles en dificultades. Halcon de van de 72 centavos de dólar o menos y Duna de de 62 centavos o menos, según datos compilados por Bloomberg.
El nuevo endeudamiento puede ser costoso. Duna con sede en la ciudad de Oklahoma emitió 1250 millones dólares de la deuda segunda-lien este mes con un interés del 8,75 por ciento, más que todos menos uno de sus bonos existentes, muestran los registros. La compañía pagó $ 24 millones en honorarios y sumará $ 109 millones al año para el pago de intereses, que ya se están comiendo el 29 por ciento de sus ingresos.
"Nos proporciona liquidez que de otra manera no habríamos tenido", dijo Justin Lewellen, portavoz Duna. "Se nos compró algo de tiempo significativo."
Las acciones de Sandridge cayeron 84 por ciento en el último año a 1,08 dólares.
Los problemas financieros de los jugadores más pequeños se convierten amplificados con los precios más bajos del petróleo, dijo Sen.
"No hemos visto lo peor", dijo.

The Economist habla de Vaca Muerta

La vaca muerta corcovea

La política es el mayor obstáculo para el desarrollo del enorme campo Vaca Muerta
The Economist

Conduciendo hacia el norte-oeste a lo largo de una carretera de álamo revestido de la ciudad de Neuquén, huertos y bodegas dan paso a una tierra completamente seca del cepillo terco, caballos salvajes resistentes y un puñado de pueblos amerindios. Bajo tierra yace una riqueza insospechada: Vaca Muerta, una formación de esquisto del tamaño de Bélgica, tiene el potencial de transformar el país.



Argentina cuenta con reservas de gas de esquisto, las segundas más grandes del mundo, la mayoría de ellos en Vaca Muerta. Una encuesta realizada por la Administración de Información de Energía de Estados Unidos (EIA) sugiere que el campo tiene 16,200,000,000 barriles de petróleo de esquisto y 308 billones de pies cúbicos (TCF) de gas de esquisto. Eso es más petróleo de esquisto de México y más gas de esquisto que Brasil. Es suficiente para satisfacer la demanda de energía actual de la Argentina desde hace más de 150 años, y podría hacer que el país exportador, una vez más.

Neuquén se está preparando para un boom. Los centros comerciales han surgido; también lo han hecho nuevos hoteles limpios que cuentan con personal que habla Inglés y de estilo americano comida. Horacio Quiroga, alcalde de la ciudad, compara sus residentes a gestantes comensales que han atado en sus dorsales. El presidente de Argentina, Cristina Fernández de Kirchner, es igualmente esperanzadora. "Voy a llamar ya no [lo] Vaca Muerta", dijo el año pasado. "Voy a llamarlo Vaca Viva."

Pero hay varias capturas. La EIA puede estar equivocado: se ha rebajado sus estimaciones para el Chaco-Paraná, otra cuenca argentina, de 164 TCF de 3 TCF. Pero los ensayos iniciales en Vaca Muerta han sido alentadores. En mayo de Exxon Mobil anunció que 770 barriles diarios habían comenzado a fluir de un pozo exploratorio allí. Chevron e YPF, la petrolera estatal de Argentina, han formado una empresa conjunta $ 1400 millones para desarrollar una concesión que actualmente produce 24.000 barriles de petróleo equivalente por día.

Geología de Vaca Muerta ayuda. Su esquisto es más gruesa que en la mayoría de las formaciones, lo que significa que las empresas pueden producir más de un solo sitio. Dado que las empresas se familiaricen con el campo, los presupuestos ya están bajando: YPF dice que ha reducido los costos de $ 11 millones por pozo en 2011 a $ 7,5 millones.


Un obstáculo más grande es la política energética del gobierno. Los controles de precios y los impuestos a la exportación han disuadido la inversión; producción de petróleo y gas han disminuido mientras que la demanda ha crecido. A menos que los cambios de política, será difícil encontrar el 140 mil millones dólares a $ 200 millones de dólares que los petroleros dicen que se requiere para el desarrollo a gran escala de Vaca Muerta. Shell, Total y muchos otros han comprado participaciones en el campo, pero hasta el momento sólo están explorando. Daniel Gerold, director de G & G Energy Consultants, estima que sólo $ 3,7 mil millones se han invertido en los últimos tres años.

Default de la Argentina en el marco de su deuda externa el 31 de julio, el resultado de una decisión de un juez de Nueva York en la disputa del gobierno con un grupo de fondos de cobertura, pone un freno adicional de la inversión potencial. (Esta semana Fernández dijo que iba a tratar de eludir la decisión del juez mediante el pago de los tenedores de bonos en Argentina, en lugar de Nueva York. Pero esta propuesta está llena de dificultades jurídicas y prácticas.)

Incluso antes del default, muchas empresas de energía se mostraron cautelosos de Argentina. Los costos de operación son altos, debido a los controles de divisas empujan hacia arriba el precio de los equipos importados. La nacionalización de las acciones de Repsol en YPF en 2012, después de la firma española ha hecho grandes descubrimientos de gas de esquisto en Vaca Muerta, fue un shock. Will Pearson de Eurasia Group, una consultora de riesgo político, piensa que la mayoría de las empresas van a esperar hasta las elecciones presidenciales de Argentina, previsto para octubre de 2015, antes de decidir si o no se mueva desde la exploración hasta la producción.

Juan José Aranguren, el jefe de la filial argentina de Shell, dice que su compañía decidirá si procede o no después de que haya terminado de explorar Vaca Muerta en 2016 Se espera que el valor por defecto para disminuir, o al menos retrasar, la inversión en el campo. Pero su mayor preocupación es la falta de un marco normativo claro. "No estamos pidiendo para el mundo. Sólo queremos ver políticas de largo plazo basadas en leyes que no se pueden cambiar por capricho ".

El gobierno ha propuesto una nueva ley de hidrocarburos, lo que ha provocado una discusión entre él y YPF y las provincias productoras de petróleo. Pero la pregunta más importante es si la señora Fernández está dispuesto a dar a las compañías de energía suficientes de lo que quieren para el desarrollo de Vaca Muerta a ponerse en marcha, o si esa tarea se reducirá a su sucesor. Incluso si ella se lanza al agua, la producción a gran escala en Vaca Muerta es de cinco años de distancia, según un ex secretario de Energía.

Un estudio revisa la estimación de pérdidas de metano en fracking

Study Revises Estimate of Methane Leaks from U.S. Fracking Fields

Leaks are minimal during removal of fracking fluids but increase once gas is flowing

By Richard A. Lovett and Nature magazine

Environmental controls designed to prevent leaks of methane from newly drilled natural gas wells are effective, a study has found — but emissions from existing wells in production are much higher than previously believed.

The findings, reported today in theProceedings of the National Academy of Sciences, add to a burgeoning debate over the climate impact of replacing oil- and coal-fired power plants with those fuelled by natural gas. Significant leaks of heat-trapping methane from natural gas production sites would erase any climate advantage the fuel offers.

One concern is the potential release of methane during hydraulic fracturing, or 'fracking', which uses injections of high-pressure fluids to shatter rock and release trapped gas. Before production can commence, the well must be 'completed' by removal of the fracking fluids, which contain gas that can escape to the air.

To test the effectiveness of current controls, the researchers installed emissions-monitoring equipment at 27 wells during their completions in 2012 and 2013. Their results suggest that current controls reduce emissions in such wells by 99% compared to sites where the technology is not used, says lead author David Allen, an engineer at the University of Texas in Austin.

The researchers' estimate of annual emissions from wells undergoing completion, 18,000 tons per year, is also roughly 97% less than the estimate given in 2011 by the US Environmental Protection Agency (EPA).

Less encouraging was what the team discovered at 150 other well sites that were already producing natural gas. Such wells often use pneumatic controllers, which siphon off pressurized natural gas from the well and use it to operate production-related equipment. "As part of their normal operation, they emit methane into the atmosphere," Allen says.

His team's work suggests that emissions from pneumatic controllers and other equipment at production wells is between 57-67% higher than the current EPA estimate. However, the study also finds total methane emissions from all phases of natural gas production to be about 2.3 million tons per year, about 10% lower than the EPA estimate of 2.5 million tons.

Conflicting numbers
The study was funded by a partnership of nine natural gas producers and the Environmental Defense Fund, a non-profit environmental group based in Washington DC, as part of a broad effort to trace methane leaks all the way from the wellhead to the user.

Robert Howarth, a biogeochemist at Cornell University in Ithaca, New York, says that it is possible that workers at the sites were especially conscientious about controlling emissions during the researchers’ monitoring, and that he views the results as a best-case scenario. But he adds, "it suggests that the oil and gas industry — when sufficiently motivated — can produce natural gas with modestly low emissions." (Allen says that his team had to give study sites some forewarning so that his team could install sensors before the completion process began.)

But Howarth argues that a bigger problem is the disparity between the latest findings and prior research that sampled air during flights over gas fields. That includes a study to which he contributed, the results of which were presented in at a meeting of the American Geophysical Union in San Francisco, California, in December 2012.

"We found very high emissions associated with a small number of wells," says Howarth. "The moral is that there are a lot of surprises out there. This paper is important in getting a lot more data, but I don't think it’s the final story."

Henry Jacoby, an economist and former director of the Joint Program on the Science and Policy of Global Change at Massachusetts Institute of Technology in Cambridge, agrees. "This is important work," he says, "but the great bulk of the problem is elsewhere, downstream in the natural gas system", including poorly capped oil and gas wells no longer in production.

Scientific American

Infografía: Frack You!

Fracking causa terremotos en Texas

Here Are 2 Ways We Now Know the Fracking Boom Is Causing Earthquakes

Researchers already knew part of the fracking process was causing the ground shake. Now they think the sheer amount of drilling it's enabled might be causing quakes, too. 

JORDAN WEISSMANN

Reuters

Hyrdaulic fracking has handed the United States a remarkable (and remarkablylucrative) oil and gas boom. In some corners of the country, though, it also seems to have led to something of an earthquake boom.

Past research has connected earthquakes in seismically mellow states like Oklahoma and Ohio to the process companies use to dispose of the water and chemicals used in fracking. Drillers inject those spent fluids into deep wells underground, which can weaken faults and trigger a quake. An important caveat: only a handful of the 30,000 disposal wells around the country have ever been implicated.

A new paper, by a team from the University of Texas, however, adds a new wrinkle to the fracking-earthquake connection. In this case, it's not the process of fracking itself that's at fault, just the volume of drilling it's enabled. As the Wall Street Journal reports, researchers found that the sheer quantity of oil and gas being removed from Texas's Eagle Ford Shale formation has actually made the region more quake-prone. Per the WSJ: 

The new study doesn't find much evidence that the man-made fracturing is causing earthquakes all by itself.
The connection is more indirect, the study found: New wells are extracting nearly 600,000 barrels of oil a day and a considerable amount of water as well. Given the scale at which oil is now being removed, enough liquids are being disturbed that rocks are settling and faults slipping, causing the small earthquakes.

As the Journal notes, Southern California experienced a similar spate of drilling-induced quakes during its own oil rush, in the 19th century. 

Now, we're not really talking about giant, earth-rending cataclysms here. Most of the seismic incidents at issue are extremely small. But the largest of the 62 probable quakes included in the survey, a 4.8 magnitude event in rural Fashing Texas that was felt some 47 miles away in San Antonio, was large enough to be of some concern. "If that had happened in an urban area there would have been severe damage,” Cliff Frohlich, one of the paper's lead researchers, told Fuel Fix. 

That said, this report does seem like a bit of good news for the oil and gas industry. As Reuters reports today, plaintiffs in Arkansas have filed five separate lawsuits against drillers whose disposal wells triggered earthquakes. It's a bit harder to think of how you'd sue companies for the consequences of a plain old oil rush. 

The Atlantic

El costo de oportunidad del fracking es el agua no contaminada

Texas se queda sin agua por culpa del fracking

Fundavida.org

La fractura hidráulica se quiere imponer ahora en Europa, pero en Estados Unidos se lleva a cabo desde hace décadas. El país norteamericano ha sido pionero en poner en práctica la extracción de gas no convencional y ahora está sufriendo las terribles consecuencias que supone esta agresión contra el medio ambiente. Un aviso para el resto del mundo.

Algunas ciudades de Texas, estado donde han proliferado los proyectos de fracking, se quedan secas: el inodoro se llena de arena; por el grifo, no sale agua, sino tierra. Es el resultado de años de inyección de productos químicos mezclados con arena y agua para romper las rocas del interior de la tierra: un medio ambiente destrozado y ciudadanos que se quedan sin suministro de agua potable.

Está ocurriendo en buena parte del sudoeste de Texas. Hay que señalar que también afectan lostres años de sequía que ha sufrido la región. Fracking y cambio climático, una desastrosa combinación. En el mencionado estado, treinta comunidades podrían quedarse sin agua a finales de este 2013, según datos de la Comisión de Texas sobre Calidad Ambiental. Casi 15 millones de personas tienen que racionar el agua, sin poder regar los jardines o llenar las piscinas.

El francking ha cambiado el paisaje de Texas. Los ganaderos no pueden alimentar a sus rebaños. Los productores de algodón han perdido hasta la mitad de sus cosechas. Centenares de pozos de agua para abastecer a las compañías petroleras que extraen gas de esquisto han dejado toda una región sin futuro. Cientos de camiones salen con el agua dulce de los pozos para poder extraer gas.

Una región sin futuro

Los árboles de los jardines se mueren. La cantidad de agua que necesita un pozo de fracking un día es suficiente para dar de beber a toda la población de una ciudad. Cuando llegó la sequía, los ciudadanos tuvieron que reducir el gasto de agua potable, pero no la industria del petróleo. Muchos propietarios de pozos se han aprovechado de la situación y han ganado mucho dinero vendiendo agua a las compañías petroleras.

En el condado de Crockett, por ejemplo, el fracking supone hasta el 25% del consumo del agua. El fracking contamina los acuíferos, produce terremotos y agota los recursos de agua potable.

10 tecnologías que van a cambiar el mundo

CITI: These 10 Technologies Are Completely Changing The World
ROB WILE





Blu Electronic Cigarettes, Citi ResearchIn a massive new research report, analysts at investment bank Citi take a close look at 10 technologies they say will disrupt the way we do business.

They've dipped into practically every sector you can think of: energy, entertainment, IT, manufacturing, and transportation among them.

Some of these technologies have been with us for awhile, but are poised to get better or cheaper.

Others have only recently surfaced, but will be ubiquitous in a matter of years.

This is what they say the future is going to look like.

Disruption 1: 3-D Printing

Citi

Printing parts and materials practically at your desktop. Thanks to falling commodity prices, easier to use software, and more complex design capabilities, the technology is poised to explode. In the future, 50% of parts used in a jet engine could be manufactured by 3D printers.

Source: Citi

The 3-D printing market could nearly double by 2019.

Citi

The 3-D printing market could grow to $6.5 billion by 2019 from less than $3.5 billion today, according to Wohlers Associates. The aerospace, orthopedic, and other high value, low volume industries will be the earliest adopters.

Source: Citi

Disruption 2: E-cigarettes

REUTERS/Christian Hartmann

Battery-powered smokes that are ostensibly less toxic than regular cigarettes. They also currently allow you to smoke in places where regular cigarettes are barred. They come in both disposable and reusable form. 

Source: Citi

E-cigarettes will see 50% CAG in coming years.

Citi

So far they're only big in the U.S., though they still comprise a small part of the overall domestic cigarette market. Citi estimates the segment will continue to see near 50% compound annual growth (CAG) over the next few years, depending on regulation and penetration into retail.

Source: Citi

Disruption 3: Genomics And Personalized Medicine

Getty Images/William Thomas Cain

People remain interested in tying their genomic makeup to their potential for carrying certain diseases.

Source: Citi

The genomics market is already exploding.

Citi

Sales could increase to $2.1 billion by 2015, compared with $700 million in 2005. So far, cancer screening, pre-natal testing, and "companion diagnostics" (which are used to determine how safe another type of therapy is), are the three main areas where this tech is getting used. The companies benefiting include manufacturers of gene sequencing machines and reagent kits, the pharma and diagnostic guys who analyze what the machines produce, and end-users: patients and payers.

Source: Citi

Disruption 4: Mobile Payments

Flickr/wei_yang

Payments that get taken from or get made by tablets or cell phones. Big in Japan (55% penetration), as well as emerging markets where cell phones reign supreme. In developed markets, it's likely to be limited to transit and retail transactions.

Source: Citi

Mobile payments could one day be a trillion dollar market.

Citi

There are currently six billion phone subscriptions globally. On the high end, Canada-based IE Market Research Corporation estimates $1 trillion of transaction value by 2016. Mobile payments will force the four traditional agents involved in transactions —  consumer, the merchant, the issuer, and the acquirer — to allow in a bunch of new players.

Source: Citi

Disruption 5: Energy Exploration Technology

Robert Libetti/ Business Insider

Hydraulic fracturing, horizontal drilling, and subsea exploration will expand the world's supply of fossil fuels. We know about fracking, which involves injecting water, sand, and chemicals into the ground to free up shale energy. Horizontal drilling allows oil and gas companies to access previously unobtainable parts of rock formations. In subsea, there are major advances underway that allow drillers to more efficiently separate water and gas from oil.

Source: Citi

The shale revolution has only just begun.

Citi

The U.S. has led the way in shale extraction, but it only possesses 13% of recoverable shale gas worldwide, so there should start to be more rapid global expansion. Subsea processing equipment has the potential to be a $100 billion per annum market by the next decade. Offshore oil and gas production already accounts for 45% of incremental supply.

Source: Citi

Disruption 6: Oil To Gas Switching

Wikimedia

Compressed natural gas vehicles are already big in the Middle East. Meanwhile lots of corporates, as well as cities that oversee taxi fleets, are converting their cars from gasoline to CNG. 

Source: Citi

CNG vehicles will continue to see robust growth abroad.

Citi

Growth is likely to remain tepid in the U.S. but will continue to expand abroad. Forecasting firm IHS estimates that global CNG are likely to grow from 0.9% of global auto production to 1.1% by 2020.

Source: Citi 

Disruption 7: Over The Top Content

Reuters/Stephen Chernin

Streaming entertainment that bypasses traditional networks and distributors. Start-up firms like Roku have sold 5 million boxes allowing consumers to stream web video right to their large, flat panel TV screen, while Netflix, Hulu, Amazon, and Google are making their own films and TV shows.

Source: Citi

Streaming is already nudging out regular old TV.

Citi

TV ratings have declined -1.2% since 2010. Meanwhile, Netflix subscriptions grew nearly 70% during the same period. Fast internet, mobile devices, and the success of the earliest firms in the space have eliminated most barriers for "OTT" content producers to enter the market.

Source: Citi

Disruption 8: The SaaS Opportunity

Citi

Software-as-a-Service (SaaS) is Internet-based software delivery. Basically customers can  access software that they'd otherwise have to purchase via downloads or at a store. Examples include Google Apps, Microsoft 365 and Amazon web services.

Source: Citi

Everyone is going to double down on SaaS.

Citi

In 2012, the SaaS market grew 26% to become an $18B market according to market research firm IDC. According to Citi's survey, SaaS has already captured 8% of their software wallets so far and firms expect to increase spending to 70% of their budget over time — a 9-fold increase.

Source: Citi

Disruption 9: Software Defined Networking

AP

Software defined networks simplify IT networks by separating the Control Plane (the intelligence) from the Data Plane (the packet forwarding engine). "Instead of having intelligence distributed across the network in separate boxes, SDN centralizes the Control plane in an overriding software layer which disseminates instructions to each router or switch."

Source: Citi

SDN is too cheap to resist.

Citi

According to IDC, Software Defined Networking is expected to grow from just under $360 million in 2013 to $3.7 billion in 2016. Revenues are likely to be split between startups, traditional network vendors like Cisco, and big IT vendors like IBM, HP, and Dell.

Source: Citi

Disruption 10: Solar

Andreas Rentz/Getty Images

Solar photovoltaics involve exciting electrons within a semiconductor material, thereby creating a current. Solar panels continue to become very cheap very quickly, resulting in cost parity being achieved in certain areas sooner than anyone expected. Solar can even be viewed as a "parasite," stealing demand from previously installed generation.

Source: Citi

Solar power has almost a Moore's-law-esque cost decline rate.

Citi

As solar gets cheaper, it will be possible to use it when there's less sunlight out.

The IEA under their base case are forecasting that solar will receive $1.3 trillion of investment in new capacity between 2012-35, representing 13% of the total global investment in power generation, ahead of gas, and only marginally behind coal. Citi views this as conservative. "Its nature means that the technology keeps getting cheaper, while alternatives gradually become more expensive, and so the ‘problem’ only becomes exacerbated."

Business Insider

Fracking: The F Word

Gag Order Bars Two American Children From Talking About Fracking
AGENCE FRANCE PRESSE


File picture shows a gas drilling rig for hydraulic fracturing on the Marcellus shale basin outside the town of Waynesburg, Pennsylvania on April 13, 2012.
Under an oil company settlement reached in the US state of Pennsylvania, two children, aged seven and 10, were told that any talk of fracking is a no-no.

Under the 2011 settlement, unsealed last week, plaintiffs Chris and Stephanie Hallowich were explicitly told that an attendant lifetime gag order -- under which they were never to discuss the Marcellus shale basin or fracking -- also applied to their children.

The Marcellus formation is a vast basin of shale containing untapped natural gas resources in the eastern United States, close to key energy markets.

However, the fracking process needed to exploit it -- in which water and chemicals are blasted into the ground -- has led to complaints by environmentalists and some local residents.

The couple had claimed that a shale gas drilling operation near their home had damaged their health, causing burning eyes, sore throats, headaches and earaches, according to the Pittsburgh Post-Gazette, which convinced a judge to unseal documents related to the case.

In a court transcript, Stephanie Hallowich says the couple agreed to the $750,000 settlement "because we needed to get the children out of there for their health and safety."

"We know we're signing for silence forever, but how is this taking away our children's rights, being minors now?" she asks, referring to her then seven-year-old daughter and 10-year-old son.

The family's attorney, Peter Villari, appears equally baffled, saying that in his 30-year career he's never seen such an order apply to minors.

Chris Hallowich argues that the two children will be growing up in the heart of the major US fracking region, with other children whose parents work in the industry.

"We can inform them. We can tell them they cannot say this, they cannot say that, but if on the playground --."

James Swetz, the lawyer for Range Resources Corporation, one of the two defendants, insists it is part of the deal.

"I guess our position is that it does apply to the whole family. We would certainly enforce it," he said.

However, a Range Resources spokesman interviewed by the Post-Gazette said the company did not agree with its attorney's comments.

"We don't believe the settlement applies to children," the spokesman told the newspaper.

Villari told the Post-Gazette he was not aware the children had been released from the agreement.

"I'd appreciate it if they'd put that in writing," he said. "It would be very nice to do that."

Copyright (2013) AFP. All rights reserved.

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Las 10 químicos mortales usados en el fracking

The 10 Scariest Chemicals Used In Hydraulic Fracking
MICHAEL KELLEY


Vast deposits of natural gas have driven a drilling boom stretching across 32 states.

The primary way of extracting the natural gas, known as hydraulic fracking, has been considered safe since a 2004 study by the Environmental Protection Agency found that it posed no risk to drinking water.

In 2005 the Bush administration and Congress used the study to justify legislation of the "Halliburton loophole," which exempts hydraulic fracturing from Safe Drinking Water Act. Legislation also exempted the practice, used in 90 percent of U.S. natural gas wells, from the Clean Water Act and Clean Air Act.

ProPublica investigations, however, found fracking to be the common thread in more than 1,000 cases of water contamination across seven states, including dozens of cases of well failures in which the concrete or steel meant to protect aquifers cracked under high pressure.

Surface and groundwater supplies are also at risk since an estimated 10 to 90 percent of fracking fluid is returned to the surface during well completion and subsequent production, according to a 2011 public health report on natural gas operations.

Natural gas is mostly methane, and the potent greenhouse gas— it traps 21 times more heat than CO2— has been leaking from wells at twice the rate of fracking industry claims, according to a 2012 study published in the journal Nature.

A 2011 congressional report on the chemicals used in hydraulic fracking, states that the 14 leading hydraulic fracturing companies in the U.S. injected 10.2 million gallons of more than 650 products that contained chemicals that are known or possible human carcinogens, regulated under the Safe Drinking Water Act, or listed as hazardous air pollutants.

Methanol

Flickr/prizepony

Methanol appeared most often in hydraulic fracturing products (in terms of the number of compounds containing the chemical).

Found in antifreeze, paint solvent and vehicle fuel.

Vapors can cause eye irritation, headache and fatigue, and in high enough doses can be fatal. Swallowing may cause eye damage or death.

Sources: ProPublica; U.S. Energy and Commerce Committee Hydraulic Fracturing Report

BTEX compounds

Flcikr/arimoore

The BTEX compounds – benzene, toluene, xylene, and ethylbenzene – are listed as hazardous air pollutants in the Clean Air Act and contaminents in the Safe Drinking Water Act.

Benzene, commonly found in gasoline, is also a known human carcinogen. Long time exposure can cause cancer, bone marrow failure, or leukemia. Short term effects include dizziness, weakness, headache, breathlessness, chest constriction, nausea, and vomiting.

Toluene, ethylbenzene, and xylenes have harmful effects on the central nervous system. 

The hydraulic fracturing companies injected 11.4 million gallons of products containing at least one BTEX chemical between 2005 and 2009.

Sources: ProPublica, U.S. Energy and Commerce Committee Hydraulic Fracturing Report

Diesel fuel

Flickr/peyri

A carcinogen listed as a hazardous air pollutant under the Clean Air Act and a contaminant in the Safe Drinking Water Act.

In its 2004 report, the EPA stated that the “use of diesel fuel in fracturing fluids poses the greatest threat” to underground sources of drinking water.

Hydraulic fracturing companies injected more than 30 million gallons of diesel fuel or hydraulic fracturing fluids containing diesel fuel in wells in 19 states.

Diesel fuel contains toxic constituents, including BTEX compounds.

Contact with skin may cause redness, itching, burning, severe skin damage and cancer.

(Kerosene is also used. Found in jet and rocket fuel, the vapor can cause irritation of the eyes and nose, and ingestion can be fatal. Chronic exposure may cause drowsiness, convulsions, coma or death.)

Sources: ProPublica, U.S. Energy and Commerce Committee Hydraulic Fracturing Report

Lead

Flickr/matthileo

A carcinogen found in paint, building construction materials and roofing joints.

It is listed as a hazardous air pollutant in the Clean Air Act and a contaminant in the Safe Drinking Water Act.

Lead is particularly harmful to children’s neurological development. It also can cause reproductive problems, high blood pressure, and nerve disorders in adults. 

One of the hydraulic fracturing companies used 780 gallons of a product containing lead between 2005 and 2009.

Source: U.S. Energy and Commerce Committee Hydraulic Fracturing Report

Hydrogen fluoride

Flickr/Molly Des Jardin

Found in rust removers, aluminum brighteners and heavy duty cleaners.

Listed as a hazardous air pollutant in the Clean Air Act.

Fumes are highly irritating, corrosive, and poisonous. Repeated ingestion over time can lead to hardening of the bones, and contact with liquid can produce severe burns. A lethal dose is 1.5 grams.

Absorption of substantial amounts of hydrogen fluoride by any route may be fatal. 

One of the hydraulic fracturing companies used 67,222 gallons of two products containing hydrogen fluoride in 2008 and 2009. 

Sources: ProPublica; U.S. Energy and Commerce Committee Hydraulic Fracturing Report

Naphthalene

Flickr/CraftyGoat

A carcinogen found in mothballs.

Listed as a hazardous air pollutant in the Clean Air Act.

Inhalation can cause respiratory tract irritation, nausea, vomiting, abdominal pain, fever or death.

Sources: ProPublica; U.S. Energy and Commerce Committee Hydraulic Fracturing Report

Sulfuric acid

Flickr/yetanotherdave

A carcinogen found in lead-acid batteries for cars.

Corrosive to all body tissues. Inhalation may cause serious lung damage and contact with eyes can lead to a total loss of vision. The lethal dose is between 1 teaspoonful and one-half ounce.

Source: ProPublica

Crystalline silica

jekemp

A carcinogen found in concrete, brick mortar and construction sands.

Dust is harmful if inhaled repeatedly over a long period of time and can lead to silicosis or cancer.

Source: ProPublica

Formaldehyde

Flickr/Stadtkatze

A carcinogen found in embalming agents for human or animal remains.

Ingestion of even one ounce of liquid can cause death. Exposure over a long period of time can cause lung damage and reproductive problems in women.

Source: ProPublica

Unknown chemicals

Flickr/SoulRider.222

"Many of the hydraulic fracturing fluids contain chemical components that are listed as 'proprietary' or 'trade secret.' The companies used 94 million gallons of 279 products that contained at least one chemical or component that the manufacturers deemed proprietary or a trade secret. In many instances, the oil and gas service companies were unable to identify these 'proprietary' chemicals,suggesting that the companies are injecting fluids containing chemicals that they themselves cannot identify."

Source: U.S. House of Representatives Energy and Commerce Hydraulic Fracturing Report

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