Shale

Energy companies across California are injecting a mysterious mix of chemicals into the ground to tap oil deposits while frustrating attempts to regulate the controversial process, known as hydraulic fracturing. The procedure has drawn the greatest attention in the Rocky Mountain West and Northeast, where states have debated moratoriums to develop regulations after toxic chemicals were found in nearby drinking water. But a quieter battle is being waged in the Golden State, which could be a candidate for increased "fracking" because of its unique geology.

General Electric Co. has agreed to acquire Lufkin Industries Inc. for more than $3 billion as the mega-firm looks to grow its expanding oil and gas business. The $88.50-a-share offer from GE represents a 38.4% premium over Lufkin's Friday $63.93 closing price. The deal for Lufkin, which employs 4,500 people in more than 40 countries, expands GE's artificial-lift capabilities to a larger variety of well types. GE Oil & Gas President Daniel C. Heintzelman said the acquisition beefs up his company's offerings in a segment that “is at the heart of critical changes” that are transforming the oil and gas industry, allowing producers to maximize the potential of wells.

Interior Secretary Ken Salazar said today that he has asked the department's inspector general to investigate a controversial set of contract amendments, finalized in the waning days of the Bush administration, that locked in industry-favorable royalty rates and environmental regulations for a series of oil shale leases on federal land in Colorado and Utah. Interior officials previously told The Times' Washington Bureau they were reviewing the highly unusual amendments, which could be worth billions to shale leaseholders, including Royal Dutch Shell, which holds three of the six leases.

The small oil town of Taft was built on petroleum -- and is now hoping for a second boom from the Monterey Shale. In a story on Sunday's front page, The Times wrote about the shale that runs miles underground through Southern and Central California. Oil companies are already drilling exploratory wells. Oil trapped in deep rock deposits in the Monterey is estimated at 15 billion barrels. That's four times the amount of oil in North Dakota's Bakken Shale, which has fueled a boom that's driven that state's unemployment rate to 3.3%, the nation's lowest.

Marathon Oil Corp. said Wednesday that it planned to buy acreage in the natural gas-rich Eagle Ford shale region of Texas in a deal valued at $3.5 billion, accelerating efforts to build up its exploration and production portfolio as the Houston company moves to spin off its refining unit. Marathon will buy properties held by Hilcorp Resources Holdings, a partnership between affiliates of Hilcorp Energy Co. and Kohlberg Kravis Roberts & Co. KKR said its stake in the deal was worth about $1.13 billion.

The Bush administration proposed charging energy companies wanting to squeeze oil out of vast shale deposits in the West lower royalties than they pay for drilling on other federal lands, including in the Gulf of Mexico and Alaska. In draft rules, the Interior Department recommended a range of royalty rates for the extraction of oil from shale on 2 million acres of public property in Colorado, Utah and Wyoming. All would be less -- at least for a time -- than the 12.5% to 18.8% the government currently collects from companies producing oil on and offshore.

Maybe there's a clue to be found in Mary Jane Eisenberg's hair. It's long now. But when her group Shale was busy exploring what the choreographer/dancer called "hyper-realism," she kept it a half-inch short, a sort of preppy punk style that went along with her wild and wacky adventures in post-modern dance.

Private equity firm KKR & Co. LP and three partners say they have agreed to buy the privately held oil and gas company Samson Investment Co. for $7.2 billion In the deal announced Wednesday, KKR and its partners will get access to oil and gas assets in booming shale regions in the U.S., including shale formations that contain large amounts of oil and other liquid hydrocarbons. Samson's wells in the deep water Gulf of Mexico and along the Gulf Coast are not included in the deal.

Re "Water, oil don't mix in Rockies," Dec. 28 Metaphorically speaking, oil doesn't mix with anything except oil companies, oil money and oil dependence. It already has been established that a lack of potable water is one of the biggest threats we face on this planet. So who stands to gain by using this resource to extract an outdated source of energy that destroys our ecosystem? I think we know. Shell Oil Communications and Sustainability Manager Tracy C. Boyd states, with cavalier nonchalance, that "as long as we continue to be a nation hooked on liquid fuel, we need to look at anything we can do to tap the resources of energy in this country."

Occidental Petroleum Corp. was buying American on Friday, announcing major acquisitions of more than $3.2 billion in crude and natural gas assets in North Dakota and southern Texas, in what may signal heightened energy-company interest in building up domestic production. The Westwood company, the nation's fourth-largest oil and gas exploration outfit, also said it had sold its operations in Argentina for $2.5 billion and would increase holdings in pipelines while boosting dividends to shareholders.

TAFT, Calif. - This two-stoplight town was built on petroleum, and residents here never miss a chance to pay tribute. A 38-foot monument to wildcatters stands downtown; locals brag it's the tallest bronze sculpture west of the Mississippi. Every five years, the city throws an "Oildorado" festival. There's even a beauty pageant in which young women dubbed "the maids of petroleum" vie to be crowned queen. It's all an homage to the bustling days when Taft boasted two giant oil fields and Standard Oil Co. of California was headquartered there.

California's Monterey shale, which holds an estimated 15 billion barrels of oil, has been touted as crucial to the state's energy future and a boon to its economy. A study released Thursday tries to quantify the potential economic benefits. The study by USC and the Communications Institute, a Los Angeles think tank, estimates that development of the 1,750-square-mile formation in central California could generate half a million new jobs by 2015 and 2.8 million by 2020. Tapping the Monterey shale, which  holds an estimated two-thirds of the country's shale oil reserves, would probably require some combination of horizontal drilling and hydraulic fracturing, known as fracking, a practice opposed by many environmentalists worried about possible damage to land and water.

When the price of gasoline rises, the supply of hot air expands. Just look at the recent GOP attacks blaming President Obama for prices that exceed $4 a gallon in some parts of the country. Not only is Obama responsible, according to some Republicans, he's downright pleased. As Mitt Romney put it last week to Fox News, "There's no question that when he ran for office, he said he wanted to see gasoline prices go up. " But there are some problems with Romney's statement.

Energy companies across California are injecting a mysterious mix of chemicals into the ground to tap oil deposits while frustrating attempts to regulate the controversial process, known as hydraulic fracturing. The procedure has drawn the greatest attention in the Rocky Mountain West and Northeast, where states have debated moratoriums to develop regulations after toxic chemicals were found in nearby drinking water. But a quieter battle is being waged in the Golden State, which could be a candidate for increased "fracking" because of its unique geology.

Private equity firm KKR & Co. LP and three partners say they have agreed to buy the privately held oil and gas company Samson Investment Co. for $7.2 billion In the deal announced Wednesday, KKR and its partners will get access to oil and gas assets in booming shale regions in the U.S., including shale formations that contain large amounts of oil and other liquid hydrocarbons. Samson's wells in the deep water Gulf of Mexico and along the Gulf Coast are not included in the deal.

The Environmental Protection Agency said it planned to regulate wastewater discharged by companies producing natural gas from shale formations, including chemically laced water used in a controversial extraction process known as hydraulic fracturing. The EPA's initiative comes as water-intensive natural gas production has spread around the country, raising concerns about the effects on drinking-water supplies. The practice, also known as fracking, involves shooting water infused with chemicals and sand at high pressure into shale formations to unlock reservoirs of natural gas. The EPA will try to determine what to do with water used during fracking, as well as water that is already underground and flows back up the well.

The drillers have gnawed through a mile of rock here, almost down to a 600-million-year-old layer of sandstone where they hope to bury about 1 million metric tons of carbon dioxide -- equal to the annual emissions of 220,000 automobiles. The $84-million project, of which $66.7 million comes from the Energy Department, will help determine whether storing greenhouse gases underground, so-called sequestration, is a viable solution for global warming. The project by Archer Daniels Midland Co.

The federal government released its management plan for drilling on the state's Roan Plateau, rejecting most of the environmental compromises offered by Democratic Gov. Bill Ritter Jr. The plateau, near Rifle, is rich in natural gas and oil shale as well as wildlife. It has been a front in a dispute over balancing energy production and wildlife resources. In December, Ritter sent recommendations to the Bureau of Land Management asking that areas considered the most environmentally sensitive be expanded and suggesting phased-in rather than all-at-once leases atop the plateau, effectively increasing the protected areas.

A federally-appointed panel recommended greater disclosure and monitoring of the environmental effects of extracting natural gas from shale formations, marking the Obama administration's first broad assessment of the controversial practice known as fracking. A coast-to-coast shale gas boom has raised concerns about the risks to underground water supplies from hydraulic fracturing, which involves mixing sand, water and chemicals and injecting them into shale formations at high pressure to unlock the gas. Environmental groups, local residents and politicians in areas rich with shale gas have said that hydraulic fracturing, or "fracking," could lead to contamination of the water table.

Marathon Oil Corp. said Wednesday that it planned to buy acreage in the natural gas-rich Eagle Ford shale region of Texas in a deal valued at $3.5 billion, accelerating efforts to build up its exploration and production portfolio as the Houston company moves to spin off its refining unit. Marathon will buy properties held by Hilcorp Resources Holdings, a partnership between affiliates of Hilcorp Energy Co. and Kohlberg Kravis Roberts & Co. KKR said its stake in the deal was worth about $1.13 billion.