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Natural Gas Development and Land Use: Conflict between Legal Rights and its Resolution

Wang Mingyuan

in Property and the Law in Energy and Natural Resources

Land is an important natural resource on which human beings depend for existence and development. Rights to land and rights to other natural resources such as mineral resources, water, forest, ... More

Land is an important natural resource on which human beings depend for existence and development. Rights to land and rights to other natural resources such as mineral resources, water, forest, grassland, wild animals, and renewable resources make up a related and complicated system of rights. This chapter is based on the existing legislation of China on natural resources, taking the exploration, exploitation, and transportation of natural gas as an example. It analyses the conflicts between rights of land use and rights of natural resource development, and puts forward suggestions for improvement.Less

Whose Hubris? Brandeis, Scientific Management, and the Railroads

Gerald Berk

in Constructing Corporate America: History, Politics, Culture

This chapter reinterprets Louis Brandeis's role in the crisis of progressive era railroad regulation. While others have implicated Brandeis in the crisis, the essay shows how he identified fatal ... More

This chapter reinterprets Louis Brandeis's role in the crisis of progressive era railroad regulation. While others have implicated Brandeis in the crisis, the essay shows how he identified fatal flaws in Interstate Commerce Commission (ICC) ratemaking and proposed a coherent alternative. Brandeis showed how rate-of-return regulation made false promises to measure the objective value of railroad property and gave the railroads perverse incentives to increase costs. Drawing on the work of scientific manager F. Lincoln Hutchins, Brandeis proposed to replace valuation with a benchmarking system by which railroads could compare their performance. Drawing on his work in Massachusetts natural gas, Brandeis proposed to set rates according to a system of ‘sliding scales’, in which railroads received higher dividends when they provided lower rates. In theory, Brandeis's system was superior to rate-of-return regulation because it provided railroads with incentives to improve and information, unavailable from the firm or the market, about how to improve.Less

Sino-Russian Energy Relations: An Uncertain Courtship

Erica S. Downs

in The Future of China-Russia Relations

This chapter explores the current state of China–Russia energy trade. It then addresses the forces of convergence and divergence shaping their energy relations. Next, the role that energy plays in ... More

This chapter explores the current state of China–Russia energy trade. It then addresses the forces of convergence and divergence shaping their energy relations. Next, the role that energy plays in the broader bilateral relationship and some of the factors that might strengthen or weaken energy cooperation between China and Russia are discussed. Whether and when China and Russia develop closer energy relations may depend on several factors, including changes in world oil prices, China's willingness to pay more for natural gas, China's willingness to play by Russia's “rules of the game” for energy cooperation, and Russian concerns about the “China threat”. These factors are also specifically described.Less

Drilling Our Soul: Moral Boundary Work in an Unlikely Old-West Fight against Fracking

Justin Farrell

in The Battle for Yellowstone: Morality and the Sacred Roots of Environmental Conflict

This chapter investigates an “outlier” case of environmental conflict, where things did not follow the same social patterns observed elsewhere in the Greater Yellowstone Ecosystem (GYE). The case ... More

This chapter investigates an “outlier” case of environmental conflict, where things did not follow the same social patterns observed elsewhere in the Greater Yellowstone Ecosystem (GYE). The case study involves conflict over a plan to drill 136 natural gas wells just to the south of Yellowstone, in Sublette County, Wyoming. This plan is not unusual, given that this county includes two of the largest gas fields in the United States and that most residents of this county and state support this economically beneficial activity. But in a radical reversal, a large group of miners, outfitters, ranchers, and other old-westerners acted against their own economic and cultural traditions, starting an environmental movement to oppose drilling in this particular area. The chapter shows that the intense negative reaction to drilling in this area is caused by a violation of strong moral boundaries linked to old-west place attachment.Less

On Efficient Utilization of Egypt's Energy Resources: Oil and Natural Gas

Hanaa Kheir-El-Din

in The Egyptian Economy: Current Challenges and Future Prospects

This chapter examines the topic of energy policy in Egypt on several fronts. Section 1 examines the world energy market with reasonable estimates of future prices for oil and natural gas, such that ... More

This chapter examines the topic of energy policy in Egypt on several fronts. Section 1 examines the world energy market with reasonable estimates of future prices for oil and natural gas, such that the “most likely” scenario from the US Department of Energy's Information Administration database. Section 2 analyzes the energy sector in Egypt including historical production, consumption, and net exports of energy resources. In addition, the research tackles when and to what extent Egypt will turn into a net importer of oil, and analyzes the trend of such behavior. Derivation of a time path for natural gas resource depletion, based upon proven reserves, and a forecasted timeline of natural gas consumption until 2025 is conducted. This is based upon comparative elasticity analysis between oil and natural gas including the calculation of price elasticity, income elasticity, and energy/GDP elasticity for both resources, and the calculation of the elasticity of substitution between oil and natural gas. The analysis also includes an energy sustainability constraint (via an application of Hartwick's model) on resource extraction rates, with the objective of guaranteeing future expected energy demand, conditional upon GDP growth rate targets, which guarantee sustainable development. Energy sustainability analysis incorporates alternative energy use including solar and nuclear energy. Section 4 offers policy recommendations.Less

Dynamic Feedbacks and Accelerating Changes

Robin M. Leichenko and Karen L. O'Brien

in Environmental Change and Globalization: Double Exposures

This chapter explores linkages and feedbacks between global environmental change and globalization. It first shows how interactions between the two processes may enhance global connectivities and ... More

This chapter explores linkages and feedbacks between global environmental change and globalization. It first shows how interactions between the two processes may enhance global connectivities and contribute to accelerating rates of global change. It then presents a case study of feedback double exposure in the arctic region. The Arctic is changing rapidly as the result of both climate change and the expansion of international shipping. Direct linkages between the processes emerge because climate change-related reductions in sea ice open new shipping routes and provide greater access to the oil and gas resources of the region. Feedbacks may occur as consumption of the region's oil and gas leads to further increases in greenhouse emissions and further arctic melting. The case shows how efforts to exploit the benefits of climate change and globalization without considering the feedbacks may lead to an acceleration of both processes, with significant implications for sustainability.Less

Transacting with Private Carriage: The Gas Pipeline Regulations of 1938

in The Political Economy of Pipelines: A Century of Comparative Institutional Development

This chapter describes how the cumulative victories by groups of gas distributors resulted in the series of conditions that made possible the defining, safeguarding, and trading of property rights. ... More

This chapter describes how the cumulative victories by groups of gas distributors resulted in the series of conditions that made possible the defining, safeguarding, and trading of property rights. Gas pipeline transport transformed over the course of sixty-five years into an industry that shows true Coasian bargaining in transport entitlements and supports the world's only vigorously competitive and openly transparent gas market with an equally vigorous futures market. The Natural Gas Act of 1938 was an unusual piece of legislation that came about in response to pressure from the states and gas-consuming city coalitions. Phillips Petroleum attempted to argue that only pipeline regulation was the subject of the Natural Gas Act. The end of conflict between shippers and pipeline owners signaled a transformation of the regulator's prime job. In 2000, the Federal Energy Regulatory Commission (FERC) resolved the last outstanding issues, and the competitive pipeline transport market took off.Less

Contemporary United States Energy Regulation

John Gulliver and Donald N. Zillman

in Regulating Energy and Natural Resources

This chapter discusses energy regulation in the United States. Topics covered include the origins of United States regulation, challenges to regulation, energy regulation under the Bush ... More

This chapter discusses energy regulation in the United States. Topics covered include the origins of United States regulation, challenges to regulation, energy regulation under the Bush Administration, and electricity and natural gas regulation. It presents four general observations about the great, bubbling world of contemporary United States energy regulation: (i) some portions of the energy sector reflect a growth of power in the federal government; (ii) contemporary energy regulation pays considerable attention to procedures that reflect collaboration rather than confrontation and encourage all stakeholders to have an early say in major energy decisions; (iii) a strong preference for competitive markets backs many aspects of policy and regulation; and (iv) given the need for market monitoring and market intervention by an informed, empowered, and neutral player, regulation will not disappear.Less

Russia: Cornering the Gas Market

Stephen E. Gent and Mark J. C. Crescenzi

in Market Power Politics: War, Institutions, and Strategic Delay in World Politics

This chapter examines how Russia’s pursuit of territorial expansion and gray zone tactics in Georgia and Ukraine can be seen as part of its overall strategy to preserve and expand its market power in ... More

This chapter examines how Russia’s pursuit of territorial expansion and gray zone tactics in Georgia and Ukraine can be seen as part of its overall strategy to preserve and expand its market power in the natural gas market. As the predominant gas supplier to many European countries, Russia’s state-owned gas company, Gazprom, has price-setting capabilities that the Russian state can exploit to extract rents and exert political leverage internationally. As part of its overall strategy to block potential competitors and secure its control over the transit of gas to European consumers, Russia has perpetuated territorial disputes with neighboring Georgia and Ukraine. Given its high level of economic interdependence with the European Union, Russia has largely refrained from escalating these disputes militarily and has instead relied upon strategic delay to achieve its market power goals.Less

Legal Aspects of Carbon Capture and Storage

Nigel Bankes and Martha Roggenkamp

in Beyond The Carbon Economy: Energy Law in Transition

Carbon capture and storage (CCS) is one of a number of potential technological options to reduce anthropogenic emissions of carbon dioxide. The literature generally identifies up to four different ... More

Carbon capture and storage (CCS) is one of a number of potential technological options to reduce anthropogenic emissions of carbon dioxide. The literature generally identifies up to four different phases in any CCS project: (1) capture, (2) transport (to the injection well), (3) injection, and (4) post-closure. This chapter sketches the key features of each of the four stages of CCS, but focuses on stages 3 and 4 in the context of onshore CCS projects. It identifies and discusses some of the key legal issues associated with these two phases of the CCS cycle, which have been grouped as a set of property issues, regulatory issues, and liability issues. Much of the analysis is premised on the assumption that we can learn a great deal from analogous operations including natural gas storage, enhanced oil recovery, acid gas disposal schemes, and deep-well waste injection. These developments are illustrated with examples from the European Union, North America (Canada and the United States), and Australia.Less

Innovation in the EU Gas Sector: Injection of Biomethane into the Natural Gas System

Martha Roggenkamp, Jacob Sandholt, and Daisy G Tempelman

in Innovation in Energy Law and Technology: Dynamic Solutions for Energy Transitions

The EU natural gas system has been developed since the 1960s, following discovery of the Groningen gas field. Climate change and security of supply challenges are affecting the natural gas market, ... More

The EU natural gas system has been developed since the 1960s, following discovery of the Groningen gas field. Climate change and security of supply challenges are affecting the natural gas market, provoking greener innovation including the introduction of renewable gases, such as biogas, which needs to be converted to biomethane (natural gas quality) before injection into the natural gas system and transported cross-border. This chapter examines the legal framework on EU and national level. Special attention is paid to: the extent to which biogas/biomethane is considered a renewable energy source; safety and quality standards; access and connection rules. National gas quality standards may, however, prove to be an obstacle for transportation cross-border. In addition, there is a trend towards cross-border contractual trade in biomethane and slowly emerging organizational developments facilitating cross-border trade in biomethane.Less

Fischer-Tropsch Synthesis: A Renewable or Nonrenewable Energy Type

Paul F. Meier

in The Changing Energy Mix: A Systematic Comparison of Renewable and Nonrenewable Energy

The Fischer-Tropsch synthesis is a catalytic polymerization reaction that can be used to make transportation fuels, primarily gasoline and diesel. The process was invented in 1925 and used ... More

The Fischer-Tropsch synthesis is a catalytic polymerization reaction that can be used to make transportation fuels, primarily gasoline and diesel. The process was invented in 1925 and used commercially by Nazi Germany in World War II as well as South Africa, starting in the 1950s. Initially, the fuel of choice to start the process was coal, but recently there has been increased interest in natural gas and biomass. The interest in natural gas is of most interest, as it provides an option for taking stranded natural gas and converting it into a liquid. This avoids the need for pipeline or liquefied natural gas (LNG) transport, which may be difficult to implement due to both geography and geopolitical reasons. The levelized cost of producing gasoline and diesel through this process is competitive with refining, but new commercial implementation has been hindered by the high capital cost of building the plant.Less

A Lack of Competent Guardians

Jessica Smartt Gullion

in Fracking the Neighborhood: Reluctant Activists and Natural Gas Drilling

This chapter deals with the regulatory and legal aspects of natural gas development in the US, with specific emphasis on Texas. Included are discussion of the major regulatory agencies involved and ... More

This chapter deals with the regulatory and legal aspects of natural gas development in the US, with specific emphasis on Texas. Included are discussion of the major regulatory agencies involved and their roles and responsibilities, along with some of the legal issues, such as that of mineral rights versus surface rights. This is followed by an overview of structural constraints on public health and safety, and some of the ways in which cities have navigated this system.Less

The Partial Deregulation of Transportation and the Creation of a Single North American Gas Market

Paul W. MacAvoy

in The Natural Gas Market: Sixty Years of Regulation and Deregulation

This chapter describes the restructuring of the natural gas industry and the emergence of the spot market, and examines the Federal Energy Regulatory Commission orders. The effects of regulation are ... More

This chapter describes the restructuring of the natural gas industry and the emergence of the spot market, and examines the Federal Energy Regulatory Commission orders. The effects of regulation are significant and result in reduction of the capacity of the pipeline system, high gas prices, and low production. The chapter studies the market effects of restructured transportation and the role of capacity increase, concluding that market, not regulatory conditions, determine prices for transportation service. The transitions to unregulated markets add to the improvement of industry performance in terms of increased production. The partial deregulation of the transport market results in no gains and the behavior of spot gas prices on the market indicates that transportation has become competitive enough to warrant the elimination of rate regulation. The chapter also presents the gains and losses from unbundling and partial deregulation, and reveals that the inconsistency leaves both producers and consumers worse off.Less

A Brief Overview of Natural Gas Drilling in Texas

Jessica Smartt Gullion

in Fracking the Neighborhood: Reluctant Activists and Natural Gas Drilling

With developments in hydrofracturing (fracking) and horizontal drilling, natural gas exploration began in earnest in the Barnett Shale region of North Texas in the late 1990s. This chapter discusses ... More

With developments in hydrofracturing (fracking) and horizontal drilling, natural gas exploration began in earnest in the Barnett Shale region of North Texas in the late 1990s. This chapter discusses the process of natural gas development. Much of the physical infrastructure and processes of extraction in this area are located in urban areas, in close proximity to neighbourhood homes and schools.Less

Self-Regulation, State Regulation, and Co-Regulation in Energy in New Zealand

Barry Barton

in Regulating Energy and Natural Resources

Energy regulation has seen many shifts and changes because of the significant policy movements that many countries have seen. Two substantial shifts have occurred in New Zealand in a two-year period, ... More

Energy regulation has seen many shifts and changes because of the significant policy movements that many countries have seen. Two substantial shifts have occurred in New Zealand in a two-year period, 2003 to 2005. The electricity market is no longer under self-regulation, but is now under state regulation. The natural gas industry is no longer virtually unregulated, as it once was, and is now under a form of co-regulation. This chapter explores the reasons for these changes.Less

Are We There Yet? The Long Road to South America's Energy Future

Lila K. Barrera-Hernández

in Beyond The Carbon Economy: Energy Law in Transition

This chapter discusses the future of South America's (SA) energy sector. The idea of looking beyond a carbon economy assumes that countries are focusing their efforts on alternatives to fossil fuels. ... More

This chapter discusses the future of South America's (SA) energy sector. The idea of looking beyond a carbon economy assumes that countries are focusing their efforts on alternatives to fossil fuels. Today, natural gas is believed to be SA's ‘bridge to the clean, low cost energies of the future’. For most South American countries, attracting foreign investment to fund the expansion of hydrocarbon reserves, output, and related infrastructure, particularly in those countries that may be at risk of becoming net importers or whose income is directly tied to hydrocarbon exports, is first on the agenda. From here to 2030 and beyond, it is a matter of tapping deeper into the region's hydrocarbon potential, increasing reserves, and expanding infrastructure coverage, including added ability to service a growing liquefied natural gas (and even gas to liquids) market. Laying the legal foundations for SA's energy future requires setting up a framework for clear, stable, and transparent transactions that lead to sustainable long-term relations amongst companies, governments, and the public.Less

Natural Gas : The Least Polluting of the Fossil Fuels

Michael B. McElroy

in Energy and Climate: Vision for the Future

In terms of emissions from combustion, natural gas, composed mainly of methane (CH4), is the least polluting of the fossil fuels. Per unit of energy produced, CO2 emissions from natural gas are ... More

In terms of emissions from combustion, natural gas, composed mainly of methane (CH4), is the least polluting of the fossil fuels. Per unit of energy produced, CO2 emissions from natural gas are 45.7% lower than those from coal (lignite), 27.5% lower than from diesel, and 25.6% lower than from gasoline. As discussed by Olah et al. (2006), humans have long been aware of the properties of natural gas. Gas leaking out of the ground would frequently catch fire, ignited, for example, by lightning. A leak and a subsequent fire on Mount Parnassus in Greece more than 3,000 years ago prompted the Ancient Greeks to attach mystical properties to the phenomenon— a flame than could burn for a long time without need for an external supply of fuel. They identified the location of this gas leak with the center of the Earth and Universe and built a temple to Apollo to celebrate its unique properties. The temple subsequently became the home for the Oracle of Delphi, celebrated for the prophecies inspired by the temple’s perpetual flame. The first recorded productive use of natural gas was in China, dated at approximately 500 BC. A primitive pipeline constructed using stems of bamboo was deployed to trans¬port gas from its source to a site where it could be used to boil brine to produce both economically valuable salt and potable water. Almost 2,000 years would elapse before natural gas would be tapped for productive use in the West. Gas from a well drilled near Fredonia, New York, was used to provide an energy source for street lighting in 1821. The Fredonia Gas Light Company, formed in 1858, was the first commercial entity established specifically to market natural gas. Joseph Newton Pew, founder of the Sun Oil Company (now Sunoco), established a company in 1883 to deliver natural gas to Pittsburgh, where it was used as a substitute for manufactured coal gas (known also as town gas). Pew later sold his interests in natural gas to J. D. Rockefeller’s Standard Oil. The early application of natural gas was primarily for lighting, not only for streets but also for factories and homes. Less