On March 9, 2015, the United States Supreme Court rendered a decision (Perez v. Mortgage Bankers Association) that allows federal agencies (such as the Environmental Protection Agency (“EPA”) and the Department of the Interior (“DOI”)) to alter longstanding interpretations of their regulations without first obtaining any input from regulated entities – even where those entities may have spent hundreds of millions of dollars designing, constructing and operating facilities in reliance upon the existing interpretations, and where compliance with the new interpretation might require retrofitting those facilities. While the Perez case did not involve a regulation impacting the energy or mining sectors, the holding of the court could nonetheless have a significant effect on those sectors. 

It’s no secret that the electric power industry is undergoing a transformation with utilities scaling up clean energy sources, embracing a new era of consumer participation and choice, and tackling issues of security, efficiency and resiliency in a changing world. As the industry turns to holistic solutions such as AC/DC transmission and distribution technologies, both centralized and decentralized control, advanced inverters, energy storage and microgrids, the challenges of integrating these new technologies into the grid are becoming more complex. To tackle these challenges, utilities, manufacturers and technology solutions providers are increasingly turning to the Energy Department’s Energy Systems Integration Facility (ESIF) located at the National Renewable Energy Laboratory (NREL) in Golden, Colo. 

Profit margins in the mining industry, frequently healthy and attractive, face high risks when market prices are low. Mining operations have never fit the historical model of cost plus margin equals selling price. In their case, market price minus cost equals margin. Without control of the selling price, cost is the only variable in this equation for a mining company to focus on and breakthrough productivity the path to address it. Lowest cost and highest efficiency is the key to a “last man standing” strategy when market prices decrease.

Operating in a culture accustomed to challenge value creation, the mining industry knows by heart that what used to work well yesterday in their operations will not be enough to deliver value (and healthy margins) tomorrow. In spite of being persistent and resilient organizations, mining operations continue to see breakthrough productivity as a strategic imperative in the current environment of low commodity prices.

If there was any doubt that the Bakken Shale is one of the hottest spots in the oil and gas industry right now, all one has to do is take a look at the rush of companies still flowing into the region. These companies not only bring their existing knowledge and expertise to the area, but also new technology, new infrastructure and new competition. All these elements add up to a marketplace that should remain healthy and highly competitive for a long time to come. 

The following special section highlights a number of the companies that have made big moves into the Bakken Shale region in recent years. Whether they bring with them new methods, new facilities or new ways of looking at the industry, there’s little doubt they are contributing to making the Bakken Shale one of the top places to be in the industry. 

Recent spikes in the number of accidents tied to aging equipment and infrastructure have put increasing pressure on mining facilities to protect their physical assets. Critical assets are the lifeblood of industrial organizations, and asset failure has dire consequences for both the safety of the workers and the ability of the mining facility to continue operations. As evidenced by recent mining disasters in Turkey and Chile, when assets fail, profitability plummets.

Many of these failures trace back to the use of faulty equipment that either had maintenance deferred or was not replaced at the end of its expected life. Often, it is not an issue of operator negligence, but a lack of visibility into potential problems that cause the lack of action. Because anomalies in asset performance are the first indicator that an accident is on the horizon, full transparency into asset performance and data management creates an environment that is both safer and more efficient. 

In late June, in a story that was first reported by The Wall Street Journal, it was announced that the U.S. Department of Commerce, through its Bureau of Industry and Security (BIS), had issued a private letter ruling for Pioneer Natural Resources (Pioneer) and Enterprise Products Partners LP (Enterprise) that allowed the companies to export lightly processed condensate from their Eagle Ford, Texas, production. The ruling had actually been issued earlier in the spring, but had been kept confidential. It nonetheless triggered a widespread media overreaction — akin to Alan Greenspan’s famed “irrational exuberance” — with expectations that the ruling heralded the coming end to the U.S.’s long-held crude oil export ban. While not wholly irrational, such expectations are likely overly optimistic.

Natural gas is a superior energy source – it is the cleanest of fossil fuels, highly efficient and, furthermore, it is readily available here on U.S. soil. Those factors alone make natural gas a very attractive substitute for other fossil fuels like petroleum and coal. Not only are power plants beginning to switch to natural gas alternatives, but also major manufacturers are starting to produce natural gas-run cars in greater quantities. 

To meet supply and demand, natural gas companies have rapidly increased production by expanding pipelines and facilities. As a result of development, point cloud technology is being implemented to document and model existing facilities for maintenance purposes, retrofit outdated equipment and upgrade facilities to include automation. 

Quite a bit has happened since my last EMI column just a short few months ago. The citizens in Denton, Texas, voted to ban fracking while voters in one California city voted to go full speed ahead. The price of oil has dropped over 25 percent, causing pundits everywhere to give their opinions on what that will mean to the oil boom. And in one of the most frustrating things to come out of Washington in quite a while (and that’s saying a lot), the Senate in their infinite lack of wisdom voted not to approve the construction of the final segment of the Keystone XL pipeline.

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