Drumbeat: April 7, 2009

April 8, 2009 by admin
Filed under Oil

In this scenario, low oil prices will continue to take oil fields out of production and reduce exploration. Once prices recover, companies will have trouble gearing back up due to the credit crunch, resulting in production-increase delays.

This is on no one’s radar.

Peak oil doesn’t mean we’re in imminent danger of running out of oil; it’s the point in time when the maximum rate of global petroleum extraction was reached, after which the rate of production enters terminal decline. The aggregate production rate from an oil field over time usually grows exponentially until the rate peaks and then declines — sometimes rapidly — until the field is depleted.

The Efficacy Of Presidential Energy Policy

From FDR to Barack Obama, occupants of the White House have at least attempted to control how we use energy sources.

Keeping wheels rolling, jets flying, and factories and lights lit are great balancing acts of the modern world–balancing often incompatible and frequently subtle economic, environmental and strategic considerations.

OPEC president can live with $50-$60 oil

LUANDA – OPEC can live with oil prices of $50-$60 a barrel for the rest of 2009, a source close to the organisation’s Angolan presidency said on Tuesday.

The comments fit with an emerging consensus in OPEC that it will accept lower prices than it would like to help nurse the global economy back to health and mark a retreat from OPEC President Jose Botelho de Vasconcelos’ remarks in March that oil could reach $75 a barrel this year.

They also imply Angola is unlikely to argue for an output cut when the group next meets on May 28.

Russia steps up gas pressure on Ukraine

KIEV/MOSCOW (Reuters) – Russia threatened to fine Ukraine on Tuesday for failing to buy enough gas in the first quarter, increasing pressure on its neighbour at a time when the World Bank said Kiev’s economy was contracting fast.

Alexei Miller, chief executive of Russia’s state-run gas giant Gazprom, told Reuters the corporation was in talks with Ukrainian counterparts over possible sanctions over lower than agreed gas imports.

Exxon says Sable Island offshore natgas field shut

NEW YORK (Reuters) – Exxon Mobil (XOM.N) said Tuesday the production field at the Sable Offshore Energy Project in Nova Scotia was shut-in after an “operational incident,” cutting off about 400 million cubic feet per day of gas production.

“The field is shut-in now. We were doing some maintenance and operating at less than normal in the last while. Work is underway to restore expected levels as soon as possible, but I can’t speculate on when that will happen,” said Exxon spokesman Merle MacIsaac.

Clean-Energy Industry in the Doldrums

Investment in renewable energy has hit a lull as private-sector money is drying up, but the bulk of government funding has yet to arrive.

Northeast Utilities plans charging stations

BOSTON—One of New England’s largest utility systems has applied for a federal grant to help build 575 stations to charge electric vehicles in Massachusetts and Connecticut.

The American Suburb Is Bouncing Back – Don’t believe the urban-living fundamentalists

When the mortgage crisis first hit, some urbanists, not surprisingly, were quick to blame the suburbs–instead of Wall Street–for the financial meltdown. With energy prices on the rise, they persuaded themselves and the ever-gullible mainstream media that the long-awaited “back to the city” jubilee was imminent.

In contrast, the suburbs and exurbs, crowed Brookings’ Chris Leinberger, were soon to become “the new slums.” As the middle classes trudged their way back to Boston and other suitably dense big cities, James Howard Kunstler–the “shock jock” of the new urbanist movement and a leading apostle of the “peak oil” thesis–happily proclaimed, “Let the gloating begin.”

Yet as George Guerrero could tell them, a dream is not a thing so easily destroyed. The American landscape continues to change, but perhaps not entirely in the ways so eagerly projected by urban boosters and their media claque.

Oil Has Peaked: Now Begins the Transition

We have officially entered the post-oil age in which the transition to lower energy lives is inevitable.

Kunstler: Strange Days

What they’re missing is real simple: peak oil means no more ability to service debt at all levels, personal, corporate, and government. End of story. All the other exertions being performed in opposition to this basic fact-of-life amount to a spastic soft-shoe performed before a smokescreen concealing a world of hurt.

Oil’s time draws to a close

We’ve had a good ride with oil. And it is cheap because all we have to do is pump it out of the ground and get it to where we want to use it. Amazing.

But we are running out of oil. Of course, there is disagreement about when it will run out, but few people doubt that at some point, the availability of oil will decline.

Dmitry Orlov: Burning our bridges to the XXI century

The future does not resemble the past – or does it? When the lights go out, people burn candles and oil lamps, just like they used to before the electric grid came into existence. No longer accustomed to working with open flame, they tend to set things on fire, and for a while, until they regain this experience or until natural selection whittles away the truly incompetent, the neighborhood is a constant blaze.

When we find out that the supermarket is out of food and that the cupboard is bare, we hunt, fish, forage, plant kitchen gardens, and start experimenting with raising poultry and rabbits. Those who are incapable of doing so, or who feel that such lowly pursuits are beneath their dignity, become dependent on the charity of those who are more adaptable, or starve.

Interview with Matt Simmons, Part 1

In the case of “Drowning with Oil,” I got a call in late February 1999 from their writer who introduced himself as being new at the energy desk but a long-timer at The Economist. He said, “I’ve been working on a major story for the better part of a month, and people I interviewed said I ought to interview you because you would have an opposing view.” He said, “the story is we’re going to have $5 oil for a decade or two because Saudi Arabia is sitting on a $100 billion war chest, and once and for all they’re going to lower the price of oil to $5 and keep it there long enough to knock out the Caspian and other stuff, including any form of alternate energy before it gets out of hand. “What do you think of that?” And I said “it’s the dumbest thing I’ve ever heard of. The oil and gas industry is suffocating on a price as low as $10-$12. Saudi Arabia doesn’t have such a war chest. Mexico and Venezuela are hurting. If we keep oil prices this low for another year to 18 months, we’ll lose 4 million barrels a day of supply. Then we’ll have an oil shock.” And he said, “oh, you can’t be right. I’ve talked to Shell, Exxon, Amy Jaffe, Dan Yergin—everybody.”

Pickens takes energy plan to University of Arkansas

FAYETTEVILLE – A former wildcatter who made his fortune finding oil presented his plan for eliminating the United States’ dependence on foreign fuels to a crowd of more than 750 people Monday.

T. Boone Pickens conducted a town-hall meeting explaining his “Pickens Plan” for reducing imported oil in the Reynolds Center for Enterprise Development at the University of Arkansas.

Lif to the fullest – Indie rapper Mr. Lif wants hip-hop to get serious

Since breaking out on El-P’s Definitive Jux label a decade ago, Jeffrey Haynes, aka Mr. Lif, has helped keep hip-hop honest. From conscientious early EPs like “Enters the Colossus” and “Emergency Rations” to plugged-in full-lengths like “I Phantom” and “Mo Mega,” Lif has spoken truth to power in hard-hitting, body-rocking rhymes that moved brains as well as spines.

So when it came time for America to enter a new phase under the leadership of Barack Obama, Lif seized the day and tightened his focus, crafting his most ambitious effort, the new “I Heard It Today.” It’s a sprawling, sociopolitical exploration, touching variously on peak oil, police brutality and even our current econo-pocalypse, which Lif explains was created by the “taxpayer slayers” on Wall Street.

UK: Urgent memorandum for the next election – Michael Meacher identifies four global fronts on which Labour should go to the country in 2010

Nor is peak oil – the point at which the world achieves maximum annual production before it declines – ever discussed publicly by governments. Yet it is widely believed by oil industry experts that this will be reached within the next five years, if it hasn’t happened already. Since oil over the past 150 years has underpinned a six-fold increase in the population of the world and is mainly responsible for the enormous industrial and technological productivity of the modern age, its virtual disappearance within the next few decades is sure to mean a dramatic alteration of the parameters of the international economy and human civilisation itself.

A Critique of Eco Judaism

One of the latest trends in the Jewish world is Eco Judaism. Eco Judaism is an effort to connect environmentalism with Judaism. Aspects of the movement are disturbing. There is a bias against capitalism and development in their materials.

Oil: No Supply Side Answer to the Coming Crisis

One hangover from the neoliberal 1980s is the myth of ‘supply side solutions’. For oil, the key target is to keep prices low as long as possible because “High oil prices hurt growth”. In practice, giving this myth some substance needs a sharp fall in economic growth and energy demand destruction.

After this, the myth goes on, oil prices will recover slower than economic growth, allowing a window of opportunity for building another fragile asset bubble. The key element, therefore, is demand destruction because supply growth is slow, underlining that so-called ‘supply side solutions’ are in fact demand-linked and demand-constrained.

Global rig count takes a dip

Baker Hughes said the number of drilling rigs actively exploring for or developing oil or natural gas across the globe dropped by 440 to 2313 in March.

In February, 2753 rigs were at work.

Chavez Says Venezuela Wants to Diversify Oil Sales

(Bloomberg) — Venezuelan President Hugo Chavez said investment deals signed with Japan and China are helping his country diversify oil sales away from the U.S., the South America nation’s biggest overseas market.

Even oil-rich Alberta gets whacked by the recession

The surplus king of provinces has turtled into “have deficit” status. True blue Alberta’s budget will be underlined in red when it is released on Tuesday, just nine months after Canada’s energy capital was overflowing with proceeds from record oil prices.

Daqing to maintain crude output

China’s largest oilfield Daqing aims to produce 400 million tons of crude in the next 10 years, according to officials with the oilfield.

“We will maintain our annual crude oil output at 40 million tons in the next 10 years,” said Wang Yongchun, Party secretary of Daqing oilfield. “Sustainable production of Daqing is important to China’s oil supply.”

Main Mexico oil ports shut on bad weather

Mexico closed the Cayo Arcas and Coatzacoalcos oil ports this afternoon and the Dos Bocas terminal remained shut due to bad weather, the government said.

The Energy Boom Everyone Forgot About

Sure, government subsidies for solar and wind power will help get those sectors rolling again. And the potential for a “cap and trade” carbon tax system is turning eyes back to geothermal power. But there’s a bigger boom right under our noses. It’s one that doesn’t require any government support. This one is going to be big – real big.

Cambridge Energy Research Associates (CERA) says it’s, “The next truly global energy business opportunity.”

Qatar launches 13.3 bln dlr gas-to-Britain project

DOHA (AFP) – Qatar on Monday inaugurated its 13.2 billion dollar Qatargas 2 project, with a production capacity of 15 million tonnes of liquefied natural gas per year, most of it destined for Britain.

The Qatargas 2 project in the Ras Laffan industrial zone in northern Qatar comprises two plants each with an annual capacity to produce 7.8 million tonnes of LNG.

BG says owns almost all of Pure Energy

The takeover marks a big step for BG’s expansion in Australia which it sees as a strategic area for development, being rich in oil and gas resources and well placed to supply markets in Asia where demand for energy has risen sharply in recent years.

Italy Plans to Extend Russian Gas Pipeline to Turkey, RT Says

(Bloomberg) — Italy plans to extend the Blue Steam pipeline that carries Russian natural gas under the Black Sea to Turkey, Italian Industry Minister Claudio Scajola said, according to Russia Today.

Ukraine’s Naftogaz says pays Russian March gas bill

KIEV (Reuters) – Ukraine has paid its March gas bill to Russian gas export monopoly Gazprom, Ukraine’s state energy company Naftogaz said on Tuesday.

“Naftogaz has transferred the money,” Naftogaz spokesman Valentyn Zemlyansky told Reuters. Gazprom declined immediate comment.

Rig Analysis: North Sea Utilization

With the UK estimating recoverable reserves of 25 Bboe and Norway estimating 82 Bboe of remaining reserves, the North Sea remains a viable geographic locale for hydrocarbon exploration and production. In fact, approximately 300 – 400 MMboe were discovered in the UK North Sea in 2008, and 837 MMboe were discovered in the Norwegian North Sea.

Saudi sells 80,000 tonnes cracked fuel oil

Saudi Aramco has sold 80,000 tonnes of cracked 380-centistoke (cst) fuel oil for April 19-21 loading from its Rabigh refinery at a smaller discount than its previous deals, traders said on Tuesday.

Aramco sold the A962 cargo – its third such parcel in the past month, or around six parcels since February – to Japan’s Itochu at a discount of around $6 (Dh22) per tonne to Singapore spot quotes, on a free-on-board (FOB) basis, traders said.

Lukoil Has First Quarterly Loss Since at Least 2001 on Oil Drop

(Bloomberg) — OAO Lukoil, Russia’s largest non- state oil producer, posted its first loss since at least 2001 as currency fluctuations and writedowns compounded a collapse in crude prices.

Lukoil had a net loss of $1.62 billion in the fourth quarter, according to Bloomberg calculations from the company’s full-year earnings report released today. That compared with net income of $3.21 billion a year earlier. Analysts had estimated a loss of $1.07 billion, based on the median of 12 responses in a Bloomberg News survey.

Total, Chevron Preparing Joint Bid for Iraq Oil Field Rights

(Bloomberg) –Total SA and Chevron Corp. will bid together for oil development rights in Iraq as firms search for new crude supplies and the Middle Eastern country looks for investors to pump cash into its economy.

Iraq, holder of the world’s third-largest oil reserves, is running two bidding rounds to attract investors after six years of conflict and prior sanctions destroyed infrastructure. Last year it pre-qualified 35 international companies to take part in the sales and added nine more to the list this month.

Oil on the agenda as Chávez visits China

Venezuelan President Hugo Chávez was set to arrive in China on Tuesday on a visit likely to deepen already strong ties that focus on oil but branch into areas stretching from the military to the media.

GM Bankruptcy Plan Said to Speed Up as Board Seeks Savings Goal

(Bloomberg) — General Motors Corp. is speeding up preparations for a possible bankruptcy filing even as directors scout for deeper savings this week to avoid that outcome, people familiar with the plans said.

GM tests a sporty new, 200-mpg 2-seater

General Motors is teaming with Segway, the scooter company, to develop a battery-powered vehicle to cut urban congestion and pollution.

The companies plan to announce the partnership Tuesday in New York, where they are testing a prototype of the partially enclosed, two-seat, two-wheel scooter. The venture is called Project PUMA, for Personal Urban Mobility and Accessibility.

Britain’s green companies having a hard time

According to a survey by the Renewable Energy Association (REA), 32 out of 39 green energy companies in Britain have admitted to a shortage of cashflow and are finding it hard to obtain loans from banks. With other countries investing highly in renewable energies, the United Kingdom may be at a huge disadvantage.

US Sec. Salazar: US Can’t Close Door on Oil and Gas

The U.S. has not ruled out opening new offshore territory to oil and gas exploration, U.S. Interior Secretary Ken Salazar told a roomful of lawmakers, environmental activists and ordinary citizens Monday.

Salazar: Eastern wind could equal coal for power

ATLANTIC CITY, N.J. – If wind power were fully developed off the East Coast, windmills could generate enough electricity to replace most, if not all, the coal-fired power plants in the United States, Interior Secretary Ken Salazar said Monday.

But those numbers were challenged as “overly optimistic” by a coal industry group, which noted that half the nation’s electricity currently comes from coal-fired power plants.

It’s not easy being green in an economic crisis

NEW YORK – When it comes to going green, Kristen Chase does what she can: recycling, using her own grocery bags, buying organic produce and conserving energy and water.

But the 32-year-old mom of three doesn’t drive a hybrid, have solar panels on the house or furniture made from recyclable materials. Not in this economy.

More states want solar power to be option on new homes

A growing number of states are moving to require home builders to offer solar electricity and hot-water systems in new homes, right alongside more traditional options such as fancy kitchen countertops and special window treatments.

“It’s just like the granite countertop upgrade or the two-car garage or the larger closet — these are options the homeowner can choose to purchase,” said Jeff Lyng, the renewable energy program manager for Colorado Gov. Bill Ritter’s Energy Office.

Empire State Building: New energy role model

NEW YORK (CNNMoney.com) — The Empire State Building kicked off a major energy-saving retrofit Monday, and promoters hope one of the world’s most iconic skyscrapers can become an efficiency model for buildings worldwide.

From the cloud-shrouded observation deck on the building’s 80th floor, former President Bill Clinton, New York City Mayor Michael Bloomberg and others detailed $20 million in cutting-edge conservation measures they hope will cut energy use by 38% for the 1930′s-era behemoth.

Fighting the recession, armed with seeds – Home gardening experiences a boom as families seek to cut food costs

Hoe in hand, Kate Kinne works her field on a cold March day.

“I do seven kinds of berries,” Kinne said. “I have an apple tree, [a] fig tree, all vegetables, eggs.”

All that production notwithstanding, Kinne’s farm doesn’t stretch over acres of rolling land. In fact, it isn’t a farm at all. It’s the small backyard of her house in Portland, Ore.
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Kinne is part of a growing movement of Americans who are turning to their own resources to fight the economic recession, now in its 16th month. As paychecks and job opportunities shrink in tandem with rising prices at the store, more and more households are growing their own food in their backyards, in shared community-run gardens and even on their windowsills.

Declaration: ‘Biochar’, a new big threat to people, land, and ecosystems

Adding charcoal (‘biochar’) to the soil has been proposed as a ‘climate change mitigation’ strategy and as a means of regenerating degraded land. Some even claim that this could sequester so much carbon that the Earth could return to pre-industrial carbon dioxide levels, i.e. that all the global warming caused by fossil fuel burning and ecosystem destruction could be reversed. Such large-scale production of charcoal would require many hundreds of millions of hectares of land for biomass production (primarily tree plantations). This is an attempt to manipulate the biosphere and land use on a vast scale in order to alter the global climate, which makes it a form of ‘geo-engineering’.

Can Carbon Capture and Storage Save Coal?

Capturing carbon dioxide may be the only hope to avoid a climate change catastrophe from burning fossil fuels.

OPEC Members Split With Developing Nations on UN Carbon Cuts

(Bloomberg) — Members of the Organization of Petroleum Exporting Countries have split with developing nations over more stringent cuts in the burning of fossil fuels, fearing their economies will suffer from shrinking demand for oil.

UN climate talks stall over emissions cuts by rich

AMSTERDAM – Negotiators at U.N. climate talks, buoyed by U.S. promises to lead the fight against global warming, are demanding that industrial countries pledge deeper cuts in greenhouse gases over the next decade.

Artic ice thinner than ever: scientists

WASHINGTON (AFP) – The Arctic ice cap is thinner than ever, satellite observations revealed Monday, while also indicating that the sea ice cover continues to shrink due to global warming.

This winter saw the fifth lowest maximum ice extent on record since monitoring by satellite began in 1979, said the Colorado-based National Snow and Ice Data Center (NSIDC).

A Sudden Chill