MONTANA, Oct 08 2008 (Neo Natura) - NorthWestern Energy has submitted two new filings to authorities regarding its proposed Mill Creek generating station.

The company submitted its application for an air quality permit with the State of Montana, and filed its request for advanced approval with the Montana Public Service Commission.

The Mill Creek generating station is expected to provide regulating resources to balance the company's transmission system in Montana to maintain reliability, and enable additional wind power to be integrated into the network to meet its future renewable energy portfolio needs.

The facility is designed to enable increasing or decreasing energy production within seconds to follow load fluctuations across the transmission system.

Bob Rowe, president and CEO of NorthWestern Energy, said: "This application moves us another step toward the price stability and operational benefits that utility-owned, rate-based supply can provide over the long-term."

Majestic Drills New Natural Gas Well

MONTANA, Jul 28 2008 (Neo Natura) - Majestic Oil and Gas, Inc, a United States Public Company whose securities are qualified for quotation on the Over the Counter Bulletin Board today announced that the Company successfully drilled the Boucher #18-1 well located in Pondera County, Montana, bringing the total number of successfully drilled wells to-date to six. The Boucher #18-1 well is the first well of a three-well drilling program, planned by the Company.

This natural gas well is located in Section 18-T29N-R5W, Pondera County, Montana. The initial production test of the Boucher #18-1 well was 3.6 pounds on a 1" orifice, which is 270 MCF per day. With these results, it was determined that the Lake Frances Field extends to the northwest, proving up additional locations for drilling. The production interval on the Boucher #18-1 well is 2324' to 2338', with 14 feet of total pay zone. The Company has plans to complete this well within the next week in addition to constructing the pipeline necessary to connect this well to the gathering system.

Clean Renewable Energy Bonds

MONTANA, Jul 14 2008 (Neo Natura) - Under the recently enacted federal Clean Renewable Energy Bond (CREB) program, electric coopoeratives, public power systems, and municipal utilities can issue or benefit from the issuance of clean renewable tax credit bonds to finance renewable energy projects as a less expensive alternative to traditional tax-exampt bonds. To a large extent, the CREB program is modeled after the Qualified Zone Academy Bond (QZAB) program enacted in 1998 to provide tax incentives for the rehabilitation of public school buildings.

A 135 acre Flathead County landfill located near Kalispell is one of the latest entities to take the goverment up on the offer. The landfill has been collecting methane gas produced by decaying garbage and then burning it, to prevent the greenhouse gas from escaping into the atmosphere.

Flathead Electric co-op's Ross Holter says next year a $3.5 million project will be financed by federal clean renewable energy bonds, and should pay for itself in about 15 years. The project will burn the methane gas that is currently being collected from the landfill, and drive a 1.6 megawatt generator hooked up to the Flathead Electric Co-op's distribution system. The generator will be capable of producing enough power for 900 homes.

Natural Gas Power Plant Expansion

MONTANA, May 21 2008 (Neo Natura) - Montgomery Energy officials said Tuesday they plan to expand a proposed natural gas-fired power plant north of Great Falls.

That surprising news came after Montgomery Energy was rebuffed Friday by the Federal Energy Regulatory Commission. The federal commission ruled Texas-based Montgomery had no right to leapfrog ahead of other power-plant projects that are waiting in line to hook up to transmission lines in the Great Falls area.

But Montgomery Energy officials said they simply had been trying to move ahead of projects that were struggling.

"The FERC ruling will have absolutely no impact on our project," said Dan Hudson, president of Montgomery Energy Partners. Instead, Montgomery officials said they not only plan to build north of Great Falls a 275-megawatt baseload power plant, estimated to cost up to $300 million, but also another 125-megawatt peaking plant, estimated to cost $96 million, which would be used to fulfill extreme power needs.

The combined facility would produce 400 megawatts of electricity, cost about $400 million to build and provide power flexibly to Montana's power grid, company officials said.

"Any time we have $100 million invested in energy in Montana, it's continuing evidence of the potential we have in all forms of energy," said Evan Barrett, chief business development officer in the governor's office.

"We're number one in coal potential and number one in wind potential, but natural gas is a resource we want to use as well," Barrett said Tuesday. "To be able to use this for peaking will allow us to use the whole combination better."

Cascade County Commissioner Peggy Beltrone praised Tuesday's announcement, saying the project "strengthens Montana's position as a national provider of clean energy." She said the plant would mean more jobs and tax base for the county. Interest in wind power is growing in Montana, and electricity produced by natural gas can be use to supplement wind energy.

In an interview, Hudson said the negative FERC ruling was "no big deal" to the company because of some positive negotiations between Montgomery Energy and NorthWestern Energy, the dominant utility in Montana. In fact, Hudson said Montgomery Energy and NorthWestern Energy had discussed mutually withdrawing the complaint several weeks ago, but the issue was too far along.

NorthWestern and Montgomery have been working in recent months to winnow down a huge estimated cost of $146.7 million for Montgomery to connect to NorthWestern's transmission lines.

That figure has now been reduced to about 2 percent of the original figure, or between $2.5 million and $3 million, he said. According to Hudson, the large cost was the principal basis for Montgomery's complaint to the federal energy regulatory board.

Hudson explained the smaller connection fee of less than $3 million is "a straight interconnect," rather than a more complex arrangement to join NorthWestern's larger network.

Mike Cashell, chief transmission officer for NorthWestern Energy in Butte, said Tuesday he could not confirm the figure of less than $3 million, but he agreed it is substantially less than before.

"There are two types of interconnections," Cashell explained.

One type of connection looks at integrating a proposed project into NorthWestern's network, and determines what type of "significant upgrades" would be needed, Cashell said. In the case of the natural gas plant, NorthWestern figured a new 238-kilivolt line would need to be built for the gas plant starting at Great Falls. That would have given Montgomery Energy all the room it needed on area transmission lines, any time of the day or night, he explained.

"We have to clear the congestion that might exist when this plant comes on," Cashell said.

Instead, Montgomery Energy opted for the second kind of connection, a simple hookup to NorthWestern lines, and to use NorthWestern's lines "if there is excess transmission available," Cashell said. "They would only get access as the transmission capacity is available."

That might be a problem for a power plant, except Hudson said his plant's prospective customers already have plenty of space reserved on transmission lines to more than cover the size of the Montgomery Energy plant.

Cashell agreed it's possible Montgomery's customers could clear the way for Montgomery to access those transmission lines.

Hudson said Montgomery Energy is still working to line up customers for what it hopes will be its 400-megawatt project, and that construction could begin late this year or in the spring of 2009.

"We need a couple things to fall into line," he said. "The design is completed."

Montgomery has a number of potential customers, including rural electric cooperatives, NorthWestern Energy itself, the city of Great Falls and customers in Alberta who could be reached through a proposed new transmission line between Great Falls and Lethbridge, Alberta, he said.

Great Falls has said it gets its power through the umbrella group Southern Montana Electric Generation & Transmission Cooperative, and SME officials have criticized wind power and natural-gas power as too expensive.

But Hudson contends SME and Great Falls may still be interested in buying power from Montgomery Energy, and/or wind farms, if plans for the proposed coal-fired power plant near Great Falls do not pan out.

"It's very hard to finance coal plants right now," Hudson said. He said Montgomery already has the money to build its project. The Rural Utilities Service earlier this year declined to finance SME's Highwood Generating Station.

Brett Doney, president of the Great Falls Development Authority, said one long-term solution is to build more transmission lines.

"We obviously want to see both projects go ahead," Doney said.

Montgomery Energy Partners' chief executive, Frank Giacalone, added, "We have the track record, are farther along in the development process, and have the ability to provide the relief to the energy needs of Montana sooner than anyone else." He said the company has built four similar facilities in the last two years, twice each in Odessa and Wharton, Tex.

Hudson said his company has been working with wind developers in Montana, since energy generated by wind turbines can complement natural-gas-fired electricity. He said Montgomery Energy's gas-fired facilities at Odessa manage 4,000 megawatts of total wind power being produced in the area.

"Our plant manages all the wind production for that area," Hudson said. "We really know how to manage it." He suggested the company could do the same in Montana, where wind development is on the rise, and said the Great Falls Energy Center is being designed to handle more than 2,000 megawatts of wind power.

Hudson said the Great Falls main plant might be expected to run about 40 to 60 percent of the time, while the smaller peaking plant might run between 15 and 40 percent of the time to accommodate customers' "extreme needs."

Hudson conceded natural gas is more expensive to burn than coal, but he noted natural gas generators are less costly to build than coal plants. The estimated cost of Montgomery Energy's 400-megawatt facility is about $400 million, half the estimated $800 million cost of the 250-megawatt coal-fired Highwood Generating Station.

DOE Evalution on Water Quality Law

MONTANA, May 08 2008 (Neo Natura) - During 2005, the Montana Board of Environmental Review (BER) announced proposed changes to Montana water quality regulations. The proposal was directed to discharges of water from coal bed natural gas (CBNG) production, and if adopted, could substantially reduce the amount of CBNG production in Montana. Potential impacts could also extend to Wyoming CBNG production through much greater restrictions on water quality that must be met at the interstate border.

DOE’s interest in this proposal stems from the importance of CBNG to U.S. natural gas supply. CBNG currently accounts for 9 percent of U.S. natural gas production and the Powder River Basin, situated in Montana and Wyoming and having a recoverable resource potential in excess of 25 trillion cubic feet, is a prime future source for U.S. natural gas supply. This is especially important in these times of tight natural gas supply and high prices.

DOE conducts technical and regulatory analyses to assist federal and state agencies in developing regulatory requirements that provide environmental benefits commensurate with their economic and energy impacts. These analyses serve to provide a scientific basis for regulatory and land management decision making.

For the proposed Montana CBNG water management rule, DOE tasked Argonne National Laboratory and Sandia National Laboratory to evaluate various aspects of the proposal. Argonne focused on regulatory and policy issues and their interrelationships with technology, and Sandia focused on water treatment and engineering, hydrologic and geologic technical issues associated with the zero discharge requirements of the proposal. The findings of these efforts were submitted for the record to the Montana BER.

New Natural Gas Interstate Pipeline

MONTANA, Apr 07 (Neo Natura) - Midstream energy firms Alliance Pipeline and Questar Overthrust Pipeline have entered into a memorandum of understanding to develop the Rockies Alliance Pipeline, a jointly owned interstate natural gas pipeline from Wamsutter, Wyoming, to the Emerson trading hub on the US-Canadian border in Minnesota.

The proposed 42-inch pipeline will traverse approximately 800 miles through the US states of Wyoming, Montana and North Dakota, connecting the Rockies natural gas producing region with natural gas markets in the US Midwest and central Canada.

The Rockies Alliance Pipeline (RAP) is proposing to interconnect with downstream pipelines to provide direct access to the Chicago Hub, Michigan and Dawn storage facilities, and upper Midwest and Northeastern markets in the US.

RAP reportedly provides maximum receipt flexibility to access the growing gas supplies in the Rocky Mountain region originating in the Wamsutter Hub as well as the Powder River Basin area. RAP also provides multiple delivery options and will offer zonal rates with the various interstate pipelines.

Alliance and Questar will work with prospective shippers to determine the most efficient size, route and timing of in-service date for the RAP facilities.

The Rockies Alliance project is one five pending pipeline proposals in Wyoming. Four of those would carry gas westward to California, said Brian Jeffries, executive director of the Wyoming Pipeline Authority. A sixth project, the Rockies Express, is under construction with plans to begin moving gas eastward by this summer. More than 50 per cent of Wyoming's tax and royalty revenues are based on natural gas, he noted.

The companies are targeting the fall of 2011 for opening the entire length of the pipeline, pending financing and regulatory approval.

Proposed Federal EIS Plan

MONTANA, Jan 31 (Neo Natura) - A public discussion on the proposed federal EIS project, a plan to designate energy corridors on federal land in 11 Western states, drew few comments at a public meeting in Helena, but for the most part was supported from representatives of organizations who attended.

Use this form to submit comments on the Energy Corridor Draft Programmatic EIS. All comments received or postmarked by Thursday, February 14, 2008 will be considered. You can also view the proposed corridor area.

Most favored a route for oil and natural gas pipelines, power lines and distribution facilities that follows U.S. 287 from Townsend to Three Forks, then westward toward Butte and Anaconda and splitting to run north and south along the inter-states.

Another favored route could run from Townsend across Interstate 15 and the Beaverhead-Deerlodge National Forest, then north to Garrison and continue into Idaho.

“I’m bringing 200 petition letters asking for either the Garrison/Milltown or Townsend/Three Forks/Milk Creek routes,” Linda Sather, Anaconda-Deer Lodge County commissioner said at Tuesday’s meeting. “We want this in our county. We welcome it and support it wholeheartedly.”

But others are wary of the corridors, saying they could run through roadless areas. In New Mexico, critics said the map of the proposed corridors show only disconnected lines and that connecting the corridors would involve pipelines and power lines crossing state, tribal or private land. They said the connecting routes should be determined before the true impacts of the corridors can be measured.

Throughout the West, the proposed corridors cross through 12 national parks, monuments or recreation areas and three wildlife refuges. That’s down from the initial plan that involved 29 national parks, monuments or recreation areas; 15 wild-life refuges; and 58 wilderness areas.

“Although the Energy Department has made significant improvements in their proposed corridor designations, the proposed corridors still lack thorough consideration of the likely damage to federal lands and other places,” said Nada Culver, who has tracked the process for the Wilderness Society since it began. “In Montana and elsewhere, the Energy Department needs to come up with alternatives to minimize the number of corridors and maximize use of renewable energy, and it should include firm requirements to limit all projects to designated corridors.”

The energy corridors are part of an energy bill passed in 2005 to provide more energy to Western states and shorten the length of time it takes the energy industry to gain approval to run pipelines and power lines.

Once projects are proposed for the corridors, they would undergo additional environmental review before permits were issued and rights-of-way granted.

Jeff Barber with the Montana Environmental Information Center said the center supports the idea of energy corridors, but would like them placed within existing transmission routes and, if possible, to limit the export of Montana power.

“If it’s a coal plant exporting power, that’s not a direction we want to go,” Barber said. “But if it’s wind generation we want to export, that’s a different situation.”

Overall, the corridors include 6,055 miles over almost 3 million acres in Montana, California, Nevada, Colorado, Utah, Washington, Oregon, Wyoming, Idaho, New Mexico and Arizona.

Brian Mills, Department of Energy environmental protection specialist, said the corridors would be about 3,500 feet wide — although that could vary — with 3,700 miles in existing corridors’ right of way.
In Montana, the proposed corridors cover 102 miles over 42,000 acres of federal land.

NWE Plans Anaconda NG Plant

MONTANA, Jan 24 (Neo Natura) - NorthWestern Energy is considering a site east of Anaconda, Montana for a proposed natural gas fired electric generation facility. The facility under consideration would provide regulating reserves within the company's transmission control area and must be approved by the MT Public Service Commission prior to the company committing to construction.

The site selection is the first of many remaining steps necessary to determine the viability of the project. The company must still obtain competitive bids for generation equipment and submit all of the necessary environmental permitting applications before determining the actual size of the project and whether it is economically viable. If, after further analysis, the project is deemed appropriate, it will be submitted to the Montana Public Service Commission in the spring or early summer for review and approval.

"There's still much work to be done; however, the site selection is necessary before proceeding with technology and environmental evaluations. Our independent engineering firm evaluated several possible sites in Montana and we chose the Mill Creek site due to the proximity and availability of electric and gas transmission facilities, access to rail and water supply," said Bill Rhoads, Director -- Montana Production.

Dave Gates, Vice President -- Wholesale Operations added that the proposed plant, adjacent to the company's Mill Creek Substation, would be built and operated in full compliance with Montana environmental statues and meet or exceed all air and water quality standards. The power from the plant would be used to balance the company's transmission system and to provide the ancillary services needed to integrate the company's existing and any additional wind energy that may be added to NorthWestern's portfolio of electric supply resources. The exact size of the proposed plant has yet to be determined pending technology and environmental evaluations, but the range under consideration is 120-220 MW with an estimated cost in excess of $100 million.

NorthWestern Energy operates a 7,000-mile high voltage transmission system that requires adequate reserve capacity to maintain federal reliability standards. Currently, the company must purchase and import these services from utilities in the northwestern US and Canada. Until recently the company was not allowed to own rate-based generation resources. The market availability of regulating reserve capacity is shrinking throughout the region because utilities are now using more of their own regulating reserve capacity for projects on their own systems.

Corp vs. Corp - Update 1

MONTANA, Jan 09 (Neo Natura) - The Mars candy empire's billions of dollars couldn't stop a state judge from ruling Tuesday that a Wyoming company can drill for natural gas beneath Forrest Mars' southeastern Montana ranch.

Drilling was expected to begin within days.

Mars had sought to block Pinnacle Gas Resources Inc. from drilling on a 10,300-acre mineral lease it holds beneath his sprawling Diamond Cross cattle ranch. But Montana law gives oil and gas companies the right to drill on private land as long as they hold valid mineral leases and meet basic notification requirements.

Forrest Mars, who is worth an estimated $14 billion, owns more than 82,000 acres along the Tongue River in Rosebud and Big Horn counties. That "surface ownership" does not include rights to much of the underground minerals, including a type of natural gas known as coal-bed methane.

"Who the surface owner is should not make any difference, and it didn't today," Pinnacle attorney Bryan Wilson said after Tuesday's ruling.

Pinnacle's lease is set to expire if the company does not begin drilling by Friday. State District Judge Blair Jones said blocking Pinnacle because it notified Mars' son-in-law of its drilling plans -- rather than Mars himself -- would have amounted to a "death sentence" for the company.

Corp vs. Corp

MONTANA, Jan 07 (Neo Natura) - A reclusive billionaire whose family owns the Mars candy empire is emerging as a formidable opponent to the energy industry's development plans in southeastern Montana.

Through his previously undisclosed ownership of the 82,000-acre Diamond Cross ranch, Mars is bringing his fortune to bear on the side of ranchers and conservationists trying to curb the companies' ambitions. Mars is worth an estimated $14 billion.

“The perception that it's the big guy (energy companies) versus the little guy (ranchers) – in this instance, that's not the case,” said Bruce Williams, vice president of Fidelity Exploration and Production, a defendant in one of several lawsuits brought by Diamond Cross over natural gas drilling.

The Mars family has a long-standing reputation for secrecy, and Forrest Mars' name is not listed as a party in any of the lawsuits pitting Diamond Cross against coal and natural gas developers. His ownership in the ranch was revealed in a Dec. 28 court affidavit reviewed by The Associated Press.

Mars did not respond to requests for interviews made through his son-in-law, Lonnie Wright, and through Diamond Cross attorney Loren O'Toole.

O'Toole said Mars' opposition to energy development stemmed from the vast amounts of water such projects can consume. In the arid West, water is essential to keeping working cattle ranches such as Diamond Cross alive.

The ranch sits on the northern end of the Powder River Basin, an area with some of the most productive coal and natural gas fields in the nation. Development of those resources was concentrated over the last decade in the southern portion of the basin, in Wyoming.

However, in recent years, exploration began pushing north into Montana. And Mars' ranch soon began to push back, with lawsuits against the companies involved.

Yet despite his hefty legal and financial resources, Mars' influence on the rolling plains of southeastern Montana could be put to the test by state and federal laws favoring oil and gas development.

Under a property regime known as split estates, landowners in many Western states do not necessarily control the minerals beneath their property. In the Diamond Cross case, Fidelity and another company, Pinnacle Gas Resources, have oil and gas leases on the ranch that predate Mars' ownership, according to public records and company officials.

State law gives the companies the right to enter Mars' land to drill on those leases. So far, however, he's held them at bay.

“Forrest has a lot of money, but he's in the same boat as anybody else,” said Beth Kaeding, chairwoman of the Northern Plains Resource Council, a conservation group of which Mars is a member.

“If you don't own the mineral rights, it doesn't matter how huge your ranch is, how politically powerful you are, how much money you have,” Kaeding said. “Mineral rights trump surface rights.”

Mars Inc. – maker of Snickers, the Mars bar, M&Ms and a variety of other food products – is one of the country's largest family-held companies, with an estimated 40,000 employees and $21 billion in annual revenues. Forrest Mars and two siblings, John and Jacqueline, each ranked among the top-20 richest Americans in 2007, according to Forbes Magazine's annual list of the wealthy.

Forrest Mars, who is in his 70s, is no longer chief executive but still contributes to the company, company spokeswoman Bertille Glass said.

Public records show the billionaire, who reportedly also has a residence in McLean, Va., began to amass property in southeastern Montana as early as 2003 – just as natural gas production in the area was booming.

Since then, Mars has launched or joined multiple court fights through Diamond Cross. The suits have challenged the industry's depletion of water reserves, a proposal to build a new coal railroad through the ranch and, most recently, efforts to drill on Diamond Cross itself.

Diamond Cross controls more than 82,000 acres in Rosebud and Bighorn counties – equivalent to roughly 130 square miles, public records show. The court affidavit lists Mars, his wife Deborah, daughter Pamela and son-in-law Wright as the co-owners of Diamond Cross Properties. Its headquarters are across the border in Wyoming, where Mars keeps a permanent residence, according to the affidavit.

Ranch manager Denise Wood said Mars had kept the Montana property as a working cattle ranch and that all its employees were “native Montanans.” She said his concerns about energy development mirrored those of many longtime residents, particularly the practice of pumping out underground water reserves to access trapped pockets of natural gas.

Those reserves are depended on by farmers and ranchers to water their fields and livestock. Energy companies sometimes capture the water and hold it in stock ponds that ranchers can use, but often it is lost as runoff. Mars attorney O'Toole said the lawsuits were not meant to “at any cost block development.” “That's not the point,” he said. “The point is, we can't lose all that water and at the same time have no provision to put it back.”

In the most recent legal case involving Diamond Cross, Wyoming-based Pinnacle Gas Resources is attempting to begin drilling on a lease it holds to more than 10,000 acres of Mars property.

When the company notified Diamond Cross last month that it planned to begin drilling on the ranch by early January, O'Toole responded with a letter barring Pinnacle employees from the ranch. If they came on the property, O'Toole wrote, Pinnacle would be “nothing more than a trespasser” attempting to “breach the peace.” Pinnacle sued, demanding access. The first hearing in the case is scheduled Tuesday, in state district court. Attorneys and a state official in charge of oil and gas development said they could not recall a similar situation over the last two decades where a landowner had to be sued for access to valid leases.

“As a lawyer it should come down to the facts and the law, but there's no denying that money talks,” said Pinnacle attorney Chris Mangen.

A Mars victory would mark “a significant change in the interpretation of state law that says you do have access,” said Tom Richmond, administrator for the Montana Board of Oil and Gas Conservation. That agency is a defendant in a separate Diamond Cross lawsuit, over its approval of some of Pinnacle's drilling plans.

Richmond offered another solution to the dispute: Pointing to the gas company's size – its stock is worth about 1 percent of Mars' estimated personal fortune – he suggested the billionaire could simply buy the publicly traded company if he was determined to keep it off his land.

Is Coal To Gas Viable?

MONTANA, Jan 02 (Neo Natura) - According to the DOE's website on Montana we are actively pursuing alternative methods of energy production. This includes building new hydro-electric sources of power and Bozeman's regional coal sequestration research project. Apparently no one has told them that the last hydro-electric dam built in Montana, completed in 1975, was Libby Dam.

While commercial research into Coal-To-Gas technology continues in surrounding states there are some real environmental and economic questions surrounding the technology.

An essay written in 2006 by Joseph Romm and Ron Erickson address some of the underlying issues related to this not-so-new technology.

First, the process is incredibly expensive. You need to spend over $6 billion just to build one plant, which would produce 80,000 barrels a day - hardly a cost-effective solution when the U.S. consumes more than 21 million barrels a day.

Second, coal-to-diesel requires lots of water, about five gallons of water for every gallon of diesel fuel - not a particularly good long-term strategy in an area that is dealing with drought and water shortages, which will only increase with global warming.

Third, the total carbon dioxide emissions from coal-to-diesel are about double that of conventional diesel. Half the emissions are from the plant, and while you can in theory capture and store that carbon underground, it is expensive. Also, permanent leak-free solutions are not yet proven. And even if the carbon is captured at the plant, you are still left with diesel fuel that is burned in a vehicle and emitted out the tailpipe. We need to reduce our carbon emissions, and coal-to-diesel will increase them. It is not a good use for billions and billions of dollars.

Another argument is that Montana is spending ample time on research, but lacks any new useful legislation to expand energy development.

The sad part is that their tactics are working. None of the bills that would truly improve Montana’s ability to develop energy resources have passed the Legislature. A handful of environmental groups have prevailed over the well-being and livelihood of tens of thousands. I watched our governor’s “energy man” walk in and oppose the first major pro-energy bill of the session, and all it was supposed to do was speed up the permitting process.