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Drill Baby Drill



According to a survey of petroleum execs, Arkansas is the best place in the world to drill for oil and gas based on royalty rates, taxation and environmental regulations.  This is not a list you want to be at the top of.  Drillers said the regulatory environment in Colorado was particularly difficult, now that groups have organized to protect that state's air, water and landscape.  "Operational, legal, and air quality rules and regulations are being instituted at a dizzying pace," one [executive] said. "It is hard to keep up with as an operator."  The article is subscription only, so I've pasted it on the jump. 

In Other News: Still reeling from the decision yesterday by the Arkansas Court of Appeals (see post below).  There's lots of speculation as to what will happen next.  Some think SWEPCO will fight until the end.  Others think there's no way it makes sense, financially, for the utility to go through another hearing or continue construction on the plant.  Initially, SWEPCO caught environmental advocacy groups asleep at the wheel, but things have changed.  Audubon Arkansas and Sierra Club are watching this like hawks and are very well-prepared for another hearing, should one take place.  No real word yet from SWEPCO as to how they'll proceed.  We'll keep you posted. 

OIL AND GAS: Execs see Ark. as world's best place to drill (06/24/2009)

Nathanial Gronewold, E&E reporter

NEW YORK -- Arkansas is the best place in the world to develop oil and gas projects based on royalty rates, taxation and environmental regulations, according to a survey of petroleum executives by a Canada-based think tank.

The Fraser Institute survey shows Bolivia is viewed as the world's worst place for petroleum extraction, edging Niger, Venezuela and Ecuador.

Faster's report, "Global Petroleum Survey 2009" -- which ranks 143 jurisdictions according to the views of 577 petroleum executives -- shows 16 U.S. states ranked among the top 20, making the United States the most attractive place for oil and gas firms.
Arkansas tops the list as both the best U.S. state and the best place in the world overall to invest in petroleum projects, followed by Alabama and Kansas in the top three. Texas and Oklahoma came in at eighth and ninth places respectively.

"The dominance of U.S. states as favorable jurisdictions for oil and gas development once again shows how the industry values stability and a clear and transparent regulatory environment," Fraser Institute economist Gerry Angevine said in a summary of the survey results.

A major surprise was Colorado's tumble to dead last among U.S. states and 81st among 143 regions covered worldwide. The state's standing was linked to tighter environmental regulations there.

Colorado ranked 61st in last year's report but had been rated as top place in the world to invest in 2007.

"Now, the industry views Colorado as the worst state for investment and companies are looking to other areas," Angevine said. Alaska and California, two of the largest oil and gas producing states, also rank low in the eyes of investors.

In anonymous comments, executives said environmental rules made it difficult to do business in Colorado. "Operational, legal, and air quality rules and regulations are being instituted at a dizzying pace," one said. "It is hard to keep up with as an operator."

Others complained of Alaska's "notoriously corrupt government" and of the "influence of plaintiffs' attorneys and politicians disconnected from industry stakeholders" in California.

Alberta, home to Canada's largest oil patch, also favors poorly compared to other provinces. Overall, respondents placed Alberta 92 out of 143 regions in the report, edging only Nunavut, the Northwest Territories and Yukon among Canadian regions.

Manitoba is seen as the best place to invest in Canada and ranked 21st worldwide. Saskatchewan, Nova Scotia, Ontario, Quebec, British Columbia, and Newfoundland and Labrador were all rated higher than Alberta by industry officials.

Survey participants complained anonymously about Alberta's "populist anti-energy ambiance copied from Alaska" and its "unskilled, uneducated, and inaccessible leadership with out-of-control regulatory expansion."

Alberta slid in the rankings compared to prior years, a result, Fraser said, because of the government's revision of royalty structures last year when oil was fetching more than $100 a barrel.

Globally, Austria ranked fourth among the most attractive places to invest. Three other countries round out the bottom of the top 20: the North Sea region of the Netherlands, Namibia and Tunisia, in that order.

Meanwhile, Russia, Nigeria, Sudan and Kazakhstan -- a few of the world's largest oil and gas exporters -- were also seen as some of the worst places for petroleum operations.

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