The Midcontinent is a region where inde- pendent producers are working closely to overcome legislative issues and taxes that would harm the oil and gas industry. Environmental concerns include green- house gas emissions and assessing the geothermal potential.
Arkansas Independents Help Defeat Severance Tax Increase
Efforts by the Arkansas Independent Produc- ers & Royalty Owners Association (AIPRO) helped defeat or table bills in the Arkansas legislature in March 2011 that would have raised the severance tax on oil and gas pro- duction. HB1992 heard informal testimony from a number of oil and gas industry people that described how the bill would harm the industry and the state. AIPRO’s message to the legislature was supported by 400-500 pro- testors demonstrating at the Capital. After the testimony, the author of HB1992 withdrew the bill for further study. AIPRO’s current mission is to prevent increases in the sever- ance tax from appearing on the November 2012 general election ballot.
Excerpted from “Arkansas Industry Repels Multiple Attacks at State Legislature,” The American Oil & Gas Reporter, April 2011, p. 19-20.
KIOGA Concerns Over Greenhouse Gas
The Kansas Independent Oil & Gas Associa- tion (KIOGA) is closely monitoring EPA decisions on greenhouse gas emissions. EPA mandates in October 2009 required electronic gathering tools to collect emissions data from oil field operations. The plan is ambiguous on what wells are impacted. The original plan dealt with greenhouse gas emissions from large sources. KIOGA notes that emissions from individual wells would be below EPA permitting requirements. The aggregate of wells needs to be defined to determine permit- ting requirements. It is currently uncertain if the aggregate wells refers to all wells in a basin or all wells operated by a specific com- pany. EPA regulations give the authority to the states to revise permitting regulations to cover emissions. EPA has extended the deadline for reporting 2010 data under the Greenhouse
Gas Reporting Program from March 30, 2011 to September 20, 2011, allowing decisions to be made and for the industry to collect data.
Excerpted from “Kansas Legislators Push for Primacy,” The American Oil & Gas Reporter, April 2011, p. 154-155.
Kansas Assesses Geothermal Energy and Heat Pumps
Heat stored in the earth’s crust creates geothermal energy that can be used as a source of energy. Hot spots in the U.S. such as Yellowstone Park are near the surface. In Kansas rock temperature of 100 °C or 212 °F are buried at depths of six miles or deeper. Geothermal heat pump systems (GHP) rely on even moderate ground temperature differences at shallow depths of 10 ft. to circulate heat or cooling to buildings. Large scale geothermal electrical power plants are west of the Rocky Mountains where high ground temperatures can be accessed or direct use systems can be developed from thermal hot springs. Kansas can’t operate large scale geothermal plants or use direct systems, but use of heat pumps is on the increase. To encourage use of geother- mal heat pumps there are federal and state tax incentives that help offset installation costs. The Kansas Geological Survey Circular pro- vides information on heat pump installation and a performance rating system to compare GHP systems for potential consumers. The overall operation of heat pumps is designed to bring warmer than outdoor air heat from the ground in the winter and carry hot air down into the cooler than outdoor ground air in the summer. Additional equipment in the system provides heated floors in the winter and heats or cools water in zones circulating within the building. A building system includes underground pipes (loops), duct work in the building to disperse air, an indoor condition- ing coil, one or more compressors (depending on building size) and one or more refrigerant heat exchangers. Four main designs are com- mercially available; a horizontal closed-loop system, a closed-loop system with a pond or lake, vertical closed-loop system, and open- loop systems relying on two vertical wells. Although installation of any of these systems requires drilling and pipe installation, the lower energy costs related to the system con- stant 50 to 60 °F ground temperature pays for itself in the long run and tax incentives help with installation costs. For Kansas and the Midcontinent heat pumps can be an attractive addition to the energy mix.
Excerpted from “Geothermal Energy and Heat Pump Potential in Kansas,” Kansas Geological Survey, Public Information Circu- lation 31, www.kgs.ku.edu/Publications/PIC/ pic31.ht
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