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City and county officials from California to New York have filed suits against oil and gas companies alleging their fossil fuel production and promotion creates a public nuisance, citing the effects of rising sea levels on coast lines and infrastructure. The states and the suits are below. California: San Francisco, Oakland in September 2017 separately sued Chevron Corp, Exxon Mobil Corp, BP Plc, ConocoPhillips and Royal Dutch Shell Plc alleging public nuisance and seeking damages to pay for seawalls and other infrastructure to guard against rising sea levels. A U.S. district court judge dismissed the suits on June 25. The cases are People of California vs. Chevron and others, 17-561370, Superior Court of California, County of San Francisco; People of California vs. BP and others, RG 17875889, Superior Court of California, County of Alameda Richmond in January filed a public nuisance claim against Chevron, Exxon Mobil, BP, Royal Dutch Shell and 25 other oil and gas companies in California Superior Court, Contra Costa County, alleging their extracting and promotion of fossil has led to rising sea levels fuels that impact the city’s property. The case is City of Richmond vs Chevron and others, C-18-00055, Superior Court of California, County of Contra Costa Santa Cruz County in December 2017 filed a public nuisance suit against Chevron, Exxon Mobil, BP, Royal Dutch Shell and others seeking damages for sea level rise and extreme flooding events blamed on fossil fuels. The case is Marin County vs. Chevron, No 17CV03242, Superior Court of California, County of Santa Cruz Imperial Beach, San Mateo County and Marin County separately filed suits in July 2017 against Chevron, Exxon Mobil, BP, Royal Dutch Shell and others alleging public nuisance, negligence and trespass and seeking undisclosed damages. The cases are City of Imperial Beach vs Chevron and others, Case C17-01227, Superior Court of California, Contra Costa County; San Mateo County vs Chevron and others, 17CIV03222, Superior Court of California, County of San Mateo; Marin County vs. Chevron and others, Case CV 1702586, Superior Court of California, County of Marin New York: New York City in January 2018 filed suit in federal court against Chevron, BP, ConocoPhillips, Exxon Mobil and Royal Dutch Shell seeking undisclosed damages from the effects of climate change. The case is City of New York vs. BP, No. 1:18-cv-00182, U.S. District Court, Manhattan Washington: King County in May 2018 filed suit against BP, Chevron, ConocoPhillips, Exxon Mobil and Shell alleging a public nuisance and trespass by their production and promotion of fossil fuels. It seeks to require the companies fund an abatement program and compensate the county for undisclosed damages.


China’s fracking support industry has grown rapidly over the past decade and now makes everything from fracking trucks and pumps to proppants, while local service providers are learning to match global rivals like Schlumberger and Baker Hughes. State majors Sinopec and CNPC produced 9 billion cubic metres (bcm) of shale gas in 2017 from 600 wells, six percent of the country’s total gas output. Production is forecast to double to 17 bcm in 2020, which will include production from another 700 wells, said consultancy Wood Mackenzie. China’s shale gas reserves are buried deeper, more scattered and in more mountainous terrain than in the United States, making them more costly to develop, but domestic gas is a major focus as the country looks to ease its reliance on dirtier coal. Reuters interviewed Chinese oil majors, local equipment and service companies and global firms involved in China’s fracking industry to compile the following industry breakdown.


TRUCKS Jingzhou-based Jianghan No.4 Machinery Plant, a unit of Sinopec Oilfield Equipment Corp (000852.SZ), is China’s leading manufacturer of fracking equipment. The firm bought several dozen U.S. fracking trucks in 1988 on condition it be allowed access to the technology, and clinched a similar technology transfer deal in the same year with U.S. company SPM, acquired by the Weir Group in 2007, that makes equipment designed for high-pressure fracturing and handling fracking fluids. Jianghan benefited from hundreds of millions of yuan in grants for special national technological projects to help develop its fleet, a company official said. The company has built several hundred fracking trucks and primarily supplies Sinopec, China’s leading shale gas producer. Baoshi Machinery Co Ltd, controlled by state energy group CNPC, is also a major producer of fracking equipment. PUMPS Industry service provider Sichuan Honghua Petroleum Equipment Co. Ltd, 30 percent controlled by state-run China Aerospace Science & Industry Corp, began making eletric-powered fracking pumps in 2015. It currently has 20 units under lease to Sinopec and PetroChina. Electric frackers, which have been adopted in the United States by companies like Evolution Well Services and U.S. Well Services, are smaller and quieter than diesel equipment and cut fuel costs by half. They are also more than twice as powerful as regular diesel frackers, but require easy access to power grids. While state-run firms focus on the domestic market, independent firms Jereh Group (002353.SZ) and Honghua Group (0196.HK) have been expanding sales of trucks and pumps to the United States. SJS, a joint venture between Sinopec Oilfield Equipment and U.S. Serva Group, makes bridge plugs, used to isolate zones in shale drilling. Sinopec officials said the SJS plugs cost a fraction of competing products. SERVICE PROVIDERS The oil price crash of 2014 forced Sinopec and CNPC to build up internal teams as they cut down on foreign service providers to slash drilling costs. CNPC’s main services arms are Chuanqing Drilling and Prospecting, Greatwall Drilling, Xibu Drilling, Bohai Drilling. Sinopec operates six regional service providers such as Jianghan, Zhongyuan and Shengli. As drilling has picked up with a rebound in oil prices, local independents such as Anton Oilfield Services (3337.HK), SPT Energy Group (1251.HK), Honghua International and Jereh (002353.SZ) have returned, mostly as subcontractors to state firms. SPT said in May that it won a 428 million yuan ($68 million) contract to drill 14 wells in Sichuan that includes drilling, fracturing and test production. Honghua separately agreed to drill four wells for 240 million yuan. Anton late last year won a 100 million yuan deal to drill four shale wells in Sichuan for PetroChina. The deal does not include equipment. “We’re hoping to see freer competition among service providers, rather than being just second options,” said a top executive with an independent service provider. Reporting by Chen Aizhu; editing by Richard Pullin

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