Drumbeat: August 29, 2010


The age of easy, cheap oil maybe getting over slowly

The Arctic is thought to hold the world’s largest reserves of untapped oil and gas, with as much as a fifth of remaining undiscovered oil located there. It is also one of the most remote and extreme regions on the planet. As per a 2008 US Geological Survey report, the Arctic Circle could hold estimated 90 billion barrels of recoverable oil. It also said the Arctic holds around 30 percent of the world’s undiscovered natural gas and 20 percent of the undiscovered natural gas liquids.

But with the specter of dwindling energy resources haunting some, exploiting these new “frontier” resources is becoming increasingly apparent. Martin Pratt, director of research at IBRU underlined that “for any state, control over hydrocarbons is significant as other resources dwindle.”

Deepwater Horizon fears resurface as rigs probe for oil under Arctic ice

In a few days' time, officials at the Bureau of Minerals and Petroleum in Greenland will reveal the winners of a new round of licences to drill for oil and gas in its waters. The announcement promises to be explosive.

Among those waiting are most of the world's leading oil companies, including ExxonMobil, Shell and Norway's StatOil. Watching with equal attention will be the planet's leading green groups, who they have pledged to block every effort to drill in the Arctic.


Natural Gas Supply on the Rise

Though the ongoing surge in the commodity’s demand (on account of hot weather) has erased a hefty surplus over last year’s inventory level, following a high of 101 Bcf for the week ending April 23, the specter of a continued glut in domestic gas supplies still exists, with storage levels remaining 6.2% above their five-year average. In fact, the latest build, though in line with market expectations, has send natural gas inventories above the 3 Tcf mark for only the second time since January 1, 2010.

Further pressurizing the commodity is the rapid rise in the number of drilling rigs working in the U.S. (the natural gas rig count has climbed 48% from the seven-year low reached last July) that signals a supply glut later this year in the face of consumer worries regarding high unemployment and economic recovery.


Venezuela's Chavez says oil price "stabilized"

CARACAS (Reuters) - Venezuelan President Hugo Chavez said on Friday that oil prices were stabilizing, giving his South American OPEC member nation's crude an average barrel price of nearly $70 this year.

"The price of oil recovered and it's more or less stabilized," he said in comments carried live on TV.


Iraq says it may abide by OPEC quotas in 2-3 years

BAGHDAD (AP) -- Iraq's oil minister says Baghdad will consider abiding by OPEC quotas once its crude production increases to at least 4 million barrels a day in two to three years.

Hussain al-Shahristani says there is no rush to discuss quotas with other members of the Organization of the Petroleum Exporting Countries while Iraq's production level remains at the current 2.5 million barrels a day.


Gulf Navigation Seeks to Acquire Oil Tankers as Economy Recovers, CEO Says

oil-tanker owner, is seeking to buy new crude carriers as an improving global economy boosts shipping volumes, the company’s chief executive officer said.

Gulf Navigation may acquire two very large crude carriers, or VLCCs, this year, Per Wistoft said in an interview Aug. 26. Oil output that’s set to rise by 2011 will bring enough added crude supply onto the market to necessitate 45 more VLCCs, Wistoft said in Dubai.


Kuwait posts $22.4 billion budget surplus

KUWAIT CITY — OPEC member Kuwait posted a budget surplus of 22.4 billion dollars in the past fiscal year on the back of strong oil revenues, an economic report said on Sunday, citing official figures.

It is the third largest windfall in the Gulf state’s history and its 11th consecutive year of budget surpluses, which have allowed Kuwait to accumulate 145 billion dollars in public revenues, according to AFP calculations based on official figures.


Qatar July Consumer Prices Decline 2.9% as Housing Costs, Fuel Prices Drop

Qatari consumer prices fell in July for the seventh consecutive month this year on lower housing and fuel costs in the world’s largest exporter of liquefied natural gas.

Consumer prices declined 2.9 percent in July, compared with a 2.8 percent fall in June, the Qatar Statistics Authority said on its website today. Rent, fuel and energy prices declined 15.3 percent in July, compared with the same month last year, the data showed.


Putin hails China ties at oil pipeline completion

(Reuters) - Russian Prime Minister Vladimir Putin on Sunday opened a pipeline branch to carry Siberian oil to China and hailed Russia's energy business in China as an important counterweight to its traditional European clients.


Brazil Needs Billions to Drill Really Deep

Brazil has a sunken-treasure problem. The discovery three years ago of a huge offshore stash of oil unleashed a gusher of nationalist euphoria. At somewhere between 9 billion and 15 billion barrels, it was the largest find in the Western Hemisphere in more than a quarter century. President Luiz Inácio Lula da Silva hailed the find as a ticket to Brazil’s “second independence,” and called on the country’s legislators to tighten state control over the oil industry.


Iraq says Kurd gas deal with Germany's RWE illegal

(Reuters) - Iraq's Oil Ministry said on Sunday the agreement Germany's RWE (RWEG.DE) signed with the Kurdish Regional Government, which included possible future gas supply for the Nabucco pipeline project, is illegal.


Alaskans sound off on Arctic offshore drilling

ANCHORAGE - Alaska's U.S. senators urged the Obama administration Thursday to get Arctic Ocean offshore petroleum development back on track.

The Alaskans who live closest to the proposed drilling rigs said federal regulators have not done enough to ensure the industry protects the environment and prepares for a catastrophic spill.


If drilling moratorium drags on it could drain Gulf of Mexico activity, expert says

Only a few rigs have left the Gulf of Mexico because of the federal deepwater drilling moratorium, but the directive could dampen long-term activity in the Gulf if it drags on, a senior policy adviser at the American Petroleum Institute said last week.


BP Internal Report Said to Find Engineers Misread Gulf Well Test Results

BP Plc’s internal investigation of the Deepwater Horizon rig disaster found company engineers misinterpreted pressure data that indicated a blowout was imminent, according to a person familiar with the report.

BP managers aboard the Transocean Ltd.-owned rig misread a test of the Macondo well’s stability on April 20 and began replacing drilling fluid, which is heavier than oil and natural gas, with seawater, said the person, who spoke on condition of anonymity because the report’s findings haven’t been publicly released.


On Louisiana coast, residents bemoan a lost summer

(Reuters) - On a typical summer weekend in Grand Isle, Louisiana, Frank Besson's small gift shop would be filled with customers picking up a souvenir as they headed back home from a weekend visit to the beach.

But this summer, business at the Nez Coupe is down about 95 percent, Besson said, as most of this coastal community's beaches remain shut. Motels are filled with workers hired by BP Plc to clean up its oil spill, not tourists.


Energy Holdings of Billionaires

That's Buffett, Icahn, and Paulson — three of the most legendary investors in the game.

But do you know what they all have in common besides being multi-billionaires?

They each added to energy positions in the last quarter.


New Zealand - Greens: Govt ignoring imminent oil crunch

The Government is ignoring international warnings of an imminent oil supply crunch and price spike, the Green Party says.

Co-leader Russel Norman revealed today he had been asking the Government to open a formal inquiry into the impact of these problems but had been rebuffed.


Study: Drinking water polluted by coal-ash dump sites

A new study identifies 39 additional coal-ash dump sites in 21 states that pollute drinking water with arsenic, lead and other heavy metals.

The analysis comes as the U.S. Environmental Protection Agency begins regional hearings on whether to regulate coal ash waste from coal-fired power plants. It will hold the first of seven hearings Monday in Arlington, Va. A public comment period ends Nov. 19.


China coal drive will not end health risks: report

(Reuters) - China's drive to promote clean coal technology is unlikely to reduce significantly the health risks of extracting what remains the dirtiest of fossil fuels, environmental group Greenpeace said.


A hopeless cause without nuclear power

HONG KONG, PACIFIC PERSPECTIVES — Ask the average environmentally concerned person how our power generators will achieve the tough emissions reductions needed to play their part in cutting global warming, and you will probably get a simple, clear answer: wind and solar.

Recent research by the International Energy Agency shows that nearly half of interviewees worldwide think that wind and solar power will be the two main sources of electricity generation by 2040. There is just one problem: That idea is naive, overoptimistic and almost certainly mistaken. Quite literally, it is "hot air."


India Risks Nuclear Isolation With Break From Chernobyl Accord

India’s push to end a three-decade ban on buying nuclear equipment from abroad may founder on laws passed by its own parliament.


Jordan to Sign Nuclear Cooperation Deal With Japan, Jordan Times Reports

Jordan and Japan are due to sign a nuclear cooperation treaty to allow Japanese companies to export atomic technology to the Middle Eastern kingdom, Minister of Planning and International Cooperation Jaafar Hassan was cited as saying by the Jordan Times.


Ethanol Futures Soar to Seven-Month High in U.S. on Increased Corn Demand

Ethanol futures soared to a seven- month high in Chicago as corn advanced after a report showed increased demand for U.S. exports.


7 U.S. troops killed in Afghan weekend attacks

KABUL, Afghanistan (AP) — Seven U.S. troops have died in weekend attacks in Afghanistan's embattled southern and eastern regions, while officials found the bodies Sunday of five kidnapped campaign workers for a female candidate in the western province of Herat.

Two servicemen died in bombings Sunday in southern Afghanistan, while two others were killed in a bomb attack in the south on Saturday and three in fighting in the east the same day, NATO said. Their identities and other details were being withheld until relatives could be notified.


Good Companies Guide: easing the planet's growing pains will help business to profit

In the face of a looming environmental and demographic crisis, weak companies will go to the wall. Only those that address the needs of a rapidly changing world will prosper.


Earth’s response to human stresses on the natural landscape

Globally the supply of phosphorus is dwindling. Phosphorus is an intrinsic part of our DNA. We add phosphorus-rich fertilizers to increase world food production, but much washes off into rivers and lakes, where it feeds excessive growth of weeds and algae and removes dissolved oxygen. When animal manure is applied directly to fields, rain also washes off some phosphorus that pollutes streams. Phosphorus is generally not recovered from human waste water treatment, so a “peak phosphorus” crisis is approaching.

Like the peak oil crisis, it is double-edged. We have a growing population dependent on finite resources — phosphorus and food, oil and energy — and growing waste problems affecting the natural environment, including fresh water pollution and atmospheric greenhouse gas pollution. Yet in both cases, we are afraid to invest in non-polluting sustainable solutions, because they are costly and require structural changes in society.


A Sticky Climate Protest

Climate change protest is becoming a sticky business in Britain.

Last Thursday, hundreds of activists with Climate Camp, a grass-roots protest group, descended on the headquarters of the Royal Bank of Scotland to protest the bank’s financing of carbon-intensive energy projects like mining and processing of Canada’s tar sands into oil.


After thousands of years, Canada's 'majestic' ice shelves disintegrating

Canada is home to plenty of ice, but the ancient, undulating ice shelves on the north coast of Ellesmere Island are something special.

For starters, the shelves are "beautiful landscapes," says earth scientist John England, at the University of Alberta, who considers the "majestic" shelves in Canada's Arctic a national treasure.

They are also unique in the Northern Hemisphere and home to the oldest sea ice in the northern half of the planet, says England, noting the shelves are 3,000 to 5,500 years old.

And they are disintegrating. A century ago, they covered almost 10,000 square kilometres, an area one and half times the size of Prince Edward Island.

Hamilton: A milestone in greener lighting

It passed by without much mention, but early this summer a major milestone was reached in the realm of LED lighting.

Home Depot quietly began taking online orders for a light-emitting diode (LED) bulb designed to replace a standard 40-watt incandescent bulb. It consumes only 8.6 watts of power, boasts superior light quality, can be dimmed, and unlike compact fluorescent bulbs doesn’t contain any mercury.

[...]

If you ask me, it can’t come soon enough. I use compact fluorescent lamps (CFLs) throughout my home, and like most people are happy that the price of these energy-efficient bulbs have come down so dramatically. Too often, however, they have let me down.

The mercury issue bugs me, but with proper disposal I can live with that. Even the light quality of CFLs has improved and won me over. My problem is that they fail prematurely, despite claims of long life.

This happened most recently while sitting in my living room. I have four recessed lighting fixtures in this room that can be dimmed, and one of them contains a CFL bulb that was designed for the purpose.

See: http://www.thestar.com/business/cleanbreak/article/852677--hamilton-a-mi...

I find it a tad ironic that folks who criticize CFLs for their short lifespan somehow believe that LED lamps will last forty or fifty years when their respective electronic packages are subject to the same thermal and electrical stresses. The same electrolytic capacitors that often result in premature CFL failure are also used in these LED drivers. These components are generally graded at either 85°C or 105°C and have a typical lifespan of between 1,000 and 2,000 hours when operated at these higher temperatures. The lamp temperature of a mid-wattage CFL operating within an airtight recessed can easily exceed 100°C and this would be likewise true of a comparable wattage LED.

Cheers,
Paul

Hi Paul
Do you have a recommendation for a non-incandescent I can use with motion-sensor lights ? I have motion-sensor systems in the basement, and at front and back door. The ubiquitous yellow bug light ;)
Thanks !!

Hi ST,

I'm afraid I don't. If these lamps are on five minutes at a time (more or less), a standard incandescent or halogen lamp is your best best; CFLs would not be a good fit due to frequent short-cycling and warm-up requirements.

If it's any consolation, the potential savings would be presumably modest. For example, assuming each fixture is fitted with two 60-watt lamps and is triggered an average of three times a day at five minutes each, the total runtime is approximately 7.5 hrs per month; at a combined total of 120-watts, that puts its usage at about 0.9 kWh per month. Two 15-watt CFLs would effectively shave that by 0.6 or 0.7 kWh per month, but at $0.12 per kWh, say, your net savings are just 8-cents.

Cheers,
Paul

Thanks !

I'm less concerned about cost for one particular application than total energy usage for the whole house.

Since the cats set off the lights more often than I do (litter trays in the basement), they are more a convenience than anything else - at least, from a security point of view, it always looks like someone is at home, even in the middle of the night ;)

I have 3 x 40-watt bulbs and the lights are set to 10 minutes, I think. Not a biggie in the greater scheme of things.

I do have spotlights (halogens, I believe) at the entryways, but they only light up when someone is actually on the property.

You're welcome, ST. For indoor applications where a larger quantity of light may be desired, a single lamp F32T8 fluorescent fixture fitted with a low-output program start ballast might be another option. A fixture such as this would supply approximately 2,400 lumens (@ 0.77 ballast factor) -- roughly twice as much light as what you have now -- and consume about 25-watts. It would be compatible with an occupancy sensor/motion detector and lamp life would not be adversely impacted as it would with an instant start ballast. This would knock nearly 100-watts off your load but, again, it only makes sense if the extra light would be helpful to you (your cats can see fine with a 4-watt photoeye night light).

Alternatively, a simple and more cost-effective fix is to substitute a single 70-watt Philips Halogená ES halogen T60 for the three 40-watt incandescents you now use (this lamp retails for approximately $4.50 at Home Depot). You'll get roughly one-third more light and your power consumption falls by 40 per cent (leave the other two incandescents in place so that the sockets are not exposed, but back them out slightly so that they don't make contact with the base). However, if you can get away with a little less light, go with the 40-watt version; in this case, light levels fall by a third and energy demand by two-thirds. Nominal lamp life is 3,000 hours, so at an average of thirty minutes per day (i.e., 3 x 10 minutes), you're looking at over 16 years of service.

Cheers,
Paul

A perfect application for LED units that have been properly designed from the sensor up. The sensor needs low voltage so drive the LEDs from the low voltage as well. Easy to add in a backup battery.

NAOM

I think each lighting product has a range of uses that make sense.

If a lighting source needs to be turned off and on often, then try to use one that does not have filaments in it (which would be tungsten filament light bulbs, and most fluorescent lights). An LED light may be idea for those.

I have some CFLs that I do not remember changing in years, and they tend to be CFLs that I 'turn on and leave on' for hours, like in the dining room or TV room.

I have had horrible success with CFLs in my own bathroom, where the lights are flicked on and off often. I went back to standard light bulbs in there [until LED lights meet an internal and arbitrary price-to-performance where I buy some :) ]

For something like a fridge, where the light in on a very short time, or lights that are rarely even turned on (attic?), then maybe just using and old incandescent bulb would be the most cost effective.

Oh, and now my children's bathroom, and the hallway, are only using 1watt LEDs night light bulbs instead of 4watt incandescent night light bulbs. Oh the savings! Just cost US$5 for two bulbs, might pay for themselves... never. But might be nice for public awareness, and the advantage they may not burn out for a very long time, being so low power....

From the Home Depot website:

EcoSmart G25 LED 40W Equivalent Bulb
Model # ECS 25 WW 120 Internet # 202324432
$29.97/EA-Each Ships FREE with $249.00 Order
This item cannot be shipped to the following state(s): AK,HI

The lumens seem just a tad low, though not anything like as absurdly low as has often been customary in past LED-bulb pitches. But it's that AK, HI, thing that really catches my eye. Generally speaking, most small electronic components can be air-shipped (airplanes themselves contain them by the countless thousands), including electrolytic capacitors (except for example acrylonitrile based ultracapacitors, which certainly wouldn't be an issue here), and even small lithium batteries (up to a point, and provided they're packed so they can't be short-cicuited.) Any idea what in the world would be going into those LED bulbs that can't be air-shipped??

I find it a tad ironic that folks who criticize CFLs for their short lifespan somehow believe...

Well, yes, ignorance is bliss and the lumen maintenance of the emitter itself may turn out not to be too bad (incandescents and CFLs both blacken after a while.) The catch being that new-ish government regulations in many countries concerning power factor and harmonics ensure that complex, finicky and somewhat fragile and possibly short-lived types of controllers are mandatory even for very low-wattage devices.

Hi Paul,

I believe end-of-life lumen maintenance for tungsten halogen is in the upper 90s and for CFLs it's probably in the low to mid 80s (by comparison, a high performance T8 fluorescent might be 92 to 94 per cent). However, if the phosphors used in LEDs are not materially different from those of fluorescent lamps and if they're driven hard as in the case of CFLs, then I would expect them to age more or less along the same lines. In any event, the reputable players will always rate LED life based on L70, i.e., the point at which light output falls to 70 per cent of its initial value (e.g., http://www.sylvania.com/BusinessProducts/Innovations/LEDLampsandRetrofit...).

BTW, in the above article, Hamilton mentions a Halifax based firm, LED Roadway Lighting. Their Satellite Series street lights are being installed throughout Nova Scotia and a number of high pressure sodium fixtures in our neighbourhood were recently converted over. Depending upon the amount of light required, these fixtures draw anywhere from 22 to 88-watts, the former being appropriate for back laneways and residential side streets and the latter high volume arteries.

Earlier today, I stumbled across a Popular Science article on street lighting from January, 1953.

See: http://books.google.ca/books?id=yS0DAAAAMBAJ&lpg=RA1-PA65&ots=5b4gCW14ur...

It talks about the installation of fluorescent street lights in Lyndonville, Vermont in August 1951. Virtually all street lights at that time would have been incandescent as mercury-vapour did not come into use until 1948 (with a little bit of LPS thrown in for good measure). These incandescent lamps would have consumed upwards of 860-watts, although most were probably in the 300 to 400-watt range. A lot has changed in the past 60 years.

Cheers,
Paul

Actually, in New York City there were still a good many incandescents well into the 1960s. AFAIK the electric company maintained them under contract (a common arrangement), and the old-fashionedness of it all in turn made their nickname, Con Edison, even a bit more strangely appropriate. Then again, the city government didn't do any better - subway stations still had madly flickering strings of incandescent bulbs running on 25 (or was it 16 2/3, but, amazingly, it wasn't a submultiple of 60) Hz.

The City of Toronto has NYC beat... it didn't phaseout its incandescent street lighting under the mid to late 1990s, at which point it was converted to metal halide.

Cheers,
Paul

You can rest assured that LED lights will never survive their potential lifespan.
1) The manufacturing costs(hence component quality) will be shaved as far as possible to maximise profit.
2) They will ensure failure so they can sell you another.

The answer to LED lighting is new light fittings not plug in bulbs that look just like the old ones. Now, we need some imaginative designers.

NAOM

Re 1) had to replace the LEDs on my big lantern because of failures. The resistor values gave a current of 30mA instead of 20mA, bad for life span good for more light from cheaper parts. New LEDs and new resistors, of the correct value, gave just as good light.

New light fittings would not in and of themselves solve the quality versus profit issues. What they would do is ensure that few people would buy LEDs, because of the horrendous (and in many places mandated by law) expense of hiring an electrician to install them. And in addition, any concentrated light source will necessarily bear a fairly strong resemblance to a light bulb, especially if it's even somewhat omnidirectional. So in a way keeping the old form factor may indeed be a bit silly, but in the real world it's not all that silly.

Also note: two-leaded 5mm low current LEDs from China seem to have a high incidence of wire bond failure. For various reasons (such as the traditional 5mm package concentrates most of the stress on the wire bond since the clear plastic is very soft and yields fairly quickly) this may be less of a problem with the higher power LEDs that ought to be be used in light-bulb substitutes. For something that runs on utility power, regardless of the fixturing, I'd worry a lot more about voltage spikes or tired electrolytic capacitors killing the controller than about the LED.

Ditto for CFLs - we all know that every electronic component contains a compressed little puff of smoke that is essential for operation ;) and when it escapes, that's the end of things. It sems to me most CFLs die that way rather than of inadequate lumen maintenance in the fluorescent tube itself.

"Russia grain export ban benefits US farmers, sparks talk on climate change"

This comment right at the end of the story got me thinking...

'Both Brown and Bange agree that what happened in Russia could happen elsewhere with more serious consequences.

"We're lucky that this heat wave was centered in Moscow instead of Chicago," says Brown. "At most, the Russians lost 40 million tons of grain. If Chicago were to have average temperatures in July of 14 degrees [Celsius] above the norm, it would have cost us and the world 150 million tons of grain."'

Yeesh...I cannot imagine...

http://www.csmonitor.com/World/Europe/2010/0827/Russia-grain-export-ban-...

Edit :

"Streak of 79F+ Days Continues (update Aug 28th)" - NOAA Weather

"The record break streak of consecutive days with highs at or above 79 degrees in Chicago continues and is forecast to last through Tuesday or Wednesday. August 28th marks the 58th consecutive day with highs of at least 79 degrees, this breaks the previous record streak of days of 43 by over 2 weeks. Given the forecast for unseasonably warm temperatures to continue through midweek this number will continue to be broken."

http://www.crh.noaa.gov/news/display_cmsstory.php?wfo=lot&storyid=57035&...

Link up top: Iraq says it may abide by OPEC quotas in 2-3 years

Iraq's oil minister said Sunday that Baghdad will consider abiding by OPEC quotas once its crude production increases to at least 4 million barrels a day in two to three years...

Al-Shahristani said Iraq hopes to boost its production capacity to 12 million barrels per day by 2017 with the new contracts -- a level that would put it just shy of OPEC kingpin Saudi Arabia's current production capacity.

Iraq says it will abide by OPEC quotas once production reaches 4 million barrels per day. But they will boost production capacity to 12 million barrels per day. Yet according to Stuart Staniford's TOD Special Thread the contract winners were to be paid by extra barrels produced, not production capacity.

Iraq held two rounds of auctions for oilfield management contracts in 2009 that the large international oil companies have responded to. The first round, in June, were for fields that were already in production and set up contracts in which companies get paid a fee per barrel for all production over the existing level.

So now we have a poser. How can the companies get paid for production over existing level after they reach 4 million barrels per day, just 1.5 mb/d over current levels, if production stops at that level?

I have a theory that Iraq now realizes that 12 mb/d was only a pipe dream but they do hope to reach 4 mb/d. At that point they will still maintain that they have the production potential of 1 mb/d but being good and honorable OPEC members, they are limited by quota to only 4 mb/d. Well that will be a trick in itself.

According to OPEC's Monthly Oil Market Report, Iraq reached a post invasion high in February of this year of 2,549,000 barrels per day. Since that date they have declined to 2,336,000 barrels per day in July, a drop of 213,000 barrels per day. They are going in the wrong direction.

Ron P.

I have a theory that Iraq now realizes that 12 mb/d was only a pipe dream but they do hope to reach 4 mb/d.

After all the bragadosia to exceed Saudi production levels, now we get this weenie 'out' by claiming to be good sumaritans, willing to abide by OPEC quotas. Of all the crock I've ever heard, the idea that some country would have the capacity to produce 12 mbd, but only produce 4, is so absurd the only thing it stimulates is cynical laughter.

I wonder how much of that original 12 mbd bragging was by pro-Bush jr. columnists here in the US, trying to say, "See, GWB did know what he was doing!"

But as we can see all too well, when it comes to reports about huge oil production potential and finds, talk is extremely cheap.

Seeing if Al-Shahristani's name popped up in any other articles in the news, I find this: Power Hungry: Iraqis Ask 'Where Is The Electricity?' - Radio Free Europe / Radio Liberty © 2010

Public confidence that anyone -- including the Americans or the Iraqi government -- can solve the situation is hard to find. As this woman, who also refused to give her name, told RFE/RL's Radio Free Iraq recently, "Let's see what the new minister will do and if he can do something for us. From the beginning, he has lied to us."

The new minister is Hussein al-Shahristani, who is also the oil minister and took over as acting head of the Electricity Ministry last month. The previous electricity minister resigned after a demonstration against power shortages in Basra turned violent and police opened fire, killing at least one protester.

To deliver the power supplies Iraqis want, the new electricity minister will have to reverse what since 2003 has been a history of massive investment with little result.

On average, Baghdad -- with a population of around 5.5 million people --had just five hours of electricity a day last month, despite the fact the United States has spent $5 billion on projects to bring more electricity to the country.

"The New York Times" reported last month that the money spent on electricity projects amounts to nearly 10 percent of the $53 billion Washington has spent on rebuilding Iraq, which was crippled by economic sanctions before the 2003 invasion. The amount is second only to what has been spent on rebuilding Iraq's security forces.

My 2006 data had Iraq at no less than 98% oil generated power. The article points out that the new capacity post-invasion was designed, sensibly enough, to run on NG; but owing to lack of adequate gas supply the plants are running on fuel oil, at reduced output.

This is an excellent piece. Any of these pie-in-the-sky output figures will require a stable grid. Also: t r u t h o u t | Is the US Pulling the Plug on Iraqi Workers? from the 27th concerns al-Shahristani and grid employees.

Further pressurizing the commodity is the rapid rise in the number of drilling rigs working in the U.S. (the natural gas rig count has climbed 48% from the seven-year low reached last July) that signals a supply glut later this year in the face of consumer worries regarding high unemployment and economic recovery.

i haven't been able to find any reasonable correlation between drilling rigs and gas production. that doesn't mean one doesn't exist, i just havent found it.

some of the reasons could be:

pipelines: waiting on pipelines large and small, long and short.

offshore: development lead time.

curtailed production: doesn't appear to be significant.

drilling success: not every well drilled is economical to produce.

and a big one: not all the gas being produced is coming from wells drilled specifically for gas. so any correlation between gas drilling rigs and gas production is going to be subdued.

any others ?

the gas drilling rig count is down 19 in the past 2 weeks. natural gas price comes closer to driving rig count than rig count driving production.

there may be a paradox or a mixed methphor or something else in the whackosphere in there somewhere.

Technical question: Can I create a URL that does a multi-tag search on The Oil Drum?

I am testing some new databrowser functionality that allows me to provide links between the graphical output provided by a databrowser and textual documentation provided elsewhere. You can see what I'm getting at by selecting Argentina, Brazil or Chile in the Gas Trends databrowser.

Currently I am linking to a blog I set up partly to test this functionality. I would also love to be able to programmatically create links to relevant TOD posts. I know that I can create a url like: http://theoildrum.com/tag/argentina. But what I really want to do is create a link that uses multiple tags, something like canada+natural_gas. This of course doesn't work or I wouldn't be asking.

Can any behind-the-scenes experts give me some advice on whether Drupal supports multiple tag searches?

(And I have one suggestion -- It would be nice if every country tag also used the ISO 3166 standard country code as a synonym so my tag search could use 'gb' instead of 'united kingdom' or 'great britain' or 'england'. I have a long post on standard country names explaining why this is important.)

Talk to SuperG. He may have some ideas.

China cuts rare earth exports by 72%.

China Backs Rare Earth Controls as Environmental Step

China cut its export quotas for rare earth by 72 percent for the second half of this year, according to data from the Ministry of Commerce on July 8. Shipments will be capped at 7,976 metric tons, down from 28,417 tons for the same period a year ago.

China controls 97 percent of production of the materials, known as rare earth elements, giving it “market power” over the U.S., the Government Accountability Office said in a report in April. China restricts exports of the elements through quotas and export taxes of as much as 25 percent, the GAO said.

Via its cheap exports, currency fixing, treasury purchases & rare earth, China hooked the biggest fish the world has ever seen. Now it's reeling it in.

As per a 2008 US Geological Survey report, the Arctic Circle could hold estimated 90 billion barrels of recoverable oil.

Wow! We are saved. 90 Billion barrels! Hummm lets see, we use about 90 million barrels per day so that gives us about 1,000 days about 2.7 years) worth of oil. Yup, we are saved.
Guess I'll go out and swap out that small block V8 for a BIG block V8.

The US and Russia already produce lots of oil from within the Arctic Circle. Prudhoe Bay is within the Arctic Circle and so is Vankor in Russia. And Russia has lots of other fields within the Arctic Circle.

But deep sea Arctic oil production is a big question mark. It will come on line very slowly if at all. In spite of global warming massive ice flows still persist throughout Arctic waters. An oil rig would be no match against a billion ton chunk of sea ice.

Yes the Arctic Circle could hold 90 billion barrels of oil and it could hold just one tenth of that. But the amount of oil under Arctic waters is the smaller issue. The greatest issue is how to safely recover any of that oil under sea ice that waxes and wanes every year. The big oil companies are not even close to solving that issue.

Ron P.

According to Arctic Sea Ice News both the Northwest and Northeast passages around the Arctic Ocean have opened up. See the Daily Image Update.

Merrill, the fact that the passage is open is great news for shippers I am sure. But we are not talking about shippers here we are talking about drillers. The big white spot that covers between 80% and 90% of the Arctic is what is in question here, not the passage.

Ron P.

The big white spot is primarily over the Arctic Ocean abyssal plain, which likely doesn't contain any oil reserves. Oil and gas is most likely to be found in the wide continental shelf north of Norway, Russia, and Siberia. Note in particular that the shallow Barents and Laptev Seas south of the line from Spitzbergen to Franz Joseph Land to Severnaya Zemlya are completely open.

The big white spot is primarily over the Arctic Ocean abyssal plain,...

Wrong! That big white spot is primarily over the majority of the Arctic ocean which averages two thirds of a mile deep over the entire ocean, about one third of a mile less than the site of the BP blowout.

Merrill, looking at your link it should be obvious that the Arctic Ocean has only a tiny slither of an abyssal plain. And indeed it is a stretch to even call that an abyssal plain. It is virtually all continental shelf. The average depth of the Arctic Ocean is 1,038 m (3,406 ft).

No, I doubt that there is much oil in that tiny slither of deep ocean in the center that goes down about three miles though the Russians did plant a flag there just in case. And I doubt that a great percentage of the oil found, if any, will be in the tiny shipping lane. Most of it will be found under the ice which covers the vast majority of the Arctic Ocean.

My data is from the Wiki link to the Arctic Ocean.

Ron P.

Most of it will be found under the ice which covers the vast majority of the Arctic Ocean.

And even the shipping lane is still covered by seasonal ice more than a meter thick. Not an easy place to put an oil platform. In very shallow waters, you can probably just make an island to drill from. Deeper, maybe a fully submersible which stays under the ice. But you still gotta find a way to get the oil out. I don't doubt it could be done, if you price the oil at several hundred dollars per barrel!

I worked for a company that ran a fleet of 26 ships in the Arctic Ocean for a couple of decades. We had a billion dollar drilling platform working all that time, and we and our competitors drilled up all the obvious prospects in the Canadian sector. We found lots of uneconomic natural gas and a little bit of uneconomic oil We ran out of prospects before we ran out of money, because the Canadian government was subsidizing the whole exercise. We got $1.25 in tax breaks for every $1.00 we spent, so there was no incentive not to spend as much as we could.

One of our competitors found one good oil well. They used to send in a tanker once a year to take out the annual production from it. It's since been plugged and abandoned since its production fell too low to pay for the tanker.

I find it interesting that the USGS carefully removed the areas we had prospected before making their estimate of how much oil can be found in the rest of the Arctic. Why would they think the rest of the Arctic is any better than what we explored? Oil companies are not stupid, they drill the best prospects first.

The Arctic Ocean is not nearly as favorable for oil as the Gulf of Mexico. It is heavily gas prone and most of the oil reservoirs have been fractured by plate tectonics, allowing any oil that might have been there to escape. There's lot's of natural gas in both the Canadian and Russian sectors, which would be useful if there weren't also lots of gas in more convenient locations like New York State.

What I fail (consistently) to understand RMG - is why isn't the real-world oil-field experience such as you have just outlined above (which I assume is not that unique, and could be replicated by a lot of experienced people if they were asked), seriously taken on-board by the USGS and anybody else who wishes to speculate on Arctic prospects and unknown unknowns? Seems they are either really dumb, totally self-obsessed by their own view of their inherent wisdom, or it is entirely political (ie BS).

Cargill, what you fail to understand, as you put it, is this is just how the USGS operates. They have been speculating for years about how much oil was in the Arctic, how much off the coast of Greenland and other places. They just assumed, when they made these predictions way back many years ago, that the technology would be there to recover the oil when needed.

They said there was 45 billion barrels off the coast of Greenland. They said there was a 90 percent chance of at least some oil and a 5 percent chance of 90 billion barrels so there was a 50 percent chance of 45 billion barrels. Their reasoning was that this was once part of the field that now makes up the North Sea. It split apart and wound up way over here but the oil, they reasoned, should still be there.

Ron P.

the oil in the mideast and north sea was still where it was when it was found. i am sceptical that the usgs reasoned as you claim.

more likely, the source rock and heat that generated all the oil in the mideast and north sea was in reasonable proximity to where it was found. greenland could have a similar history to that of the mideast and north sea. i have no opinion as to how much oil might be off greenland.

by way of example, i believe subsalt geology offshore south america is similar to subsalt geology offshore africa. these continents drifted far apart and yet the geology is reasonably preserved. so i don't see any reason to believe or disbelive how much oil greenland may have.

you seem stuck on the idea that vast quantities of oil can not be there.

The difference between oil industry geologists and USGS geologists is that oil industry geologists get fired if they make stupid predictions that turn out to be wrong. There are no consequences for being wrong in government. In fact, they might get promoted - the USGS is a very political organization that makes a point of being optimistic about the future of US and world oil production.

I remember a TV interview with a former president of PanArctic Petroleum, one of our competitors that no longer exists, and he said, "We ran out of prospects before we ran out of money. People would still give us lots of money, but there was nowhere left to drill."

The Arctic Ocean is one of the few areas of the globe that hasn't been drilled to death, so the USGS is optimistic about it. The Canadian sector, though, has been drilled to death, so they're optimistic about the parts that still haven't been turned into pincushions.

In fact, they might get promoted - the USGS is a very political organization that makes a point of being optimistic about the future of US and world oil production.

Any reference for this particular statement? Any memo's saying that only optimistic estimates allowed, perhaps the names of any Directors who were promoted to that position after putting out a world level assessment some order of magnitude higher than anyone else, and on the topic of production? The USGS seems to deal almost exclusively with future resource estimates and the geologic basis for such, so I have a high level of interest in production estimates from the same group.

And I assume this is within the timespan of a career, so lets call it within the past 25 years or so? The Arctic work was done a few years back, so any claims of bias would have to apply to people within about that timespan. Does your information come from the web, utube video's, perhaps some technical journal?

Among other things it's based on comments by people who are familiar with what goes on inside the organization. Their estimates of US oil potential back in the 1950's was about 3 times as high as M. King Hubbert's, and Hubbert is well known to have predicted the peaking of US oil production in the 1970's rather accurately, while the USGS estimates turned out to wildly overoptimistic. Vincent McKelvey was the geologist usually cited for the wildest of the wild estimates, and he had a long run at USGS, although he was eventually fired in 1978 after Congress got upset with how badly he had misled them.

Their recent forecasts haven't been very accurate, either. Their forecasts imply new global discoveries of 22 billion barrels per year, but the actual numbers have been closer to 9 billion barrels per year for the past decade. If they were using statistically valid techniques, sometimes they would be high, and sometimes they would be low, but the errors on the high side would cancel out those on the low side, and the totals would average out somewhere close to reality. However, with all their estimates being on the high side, the total ends up being out in deep space somewhere - much higher than anybody else's estimates.

My concern with their current estimates, based on their poor track record, is that they are still being overoptimistic. How could they come up with an estimate of 47 billion barrels in offshore East Greenland? Nobody has a clue what is offshore of Greenland, since nobody has done any drilling there, but 47 billion barrels seems wildly optimistic. There isn't any real reason to think it is any better than the Canadian Arctic - it's only advantage is that it hasn't been drilled yet.

However, I do recall running about 6000 tapes from a seismic survey done offshore of Greenland through a supercomputer about 30 years ago, and while I don't know the results of it, I don't recall anybody rushing out to drill anything there. These days you could probably spot a really big oilfield from satellite.

Their estimates of US oil potential back in the 1950's was about 3 times as high as M. King Hubbert's, and Hubbert is well known to have predicted the peaking of US oil production in the 1970's rather accurately, while the USGS estimates turned out to wildly overoptimistic.

Thats why I asked the question with a more recent time frame. And in the 70's, Hubbert was a USGS scientist. I was more curious about how you mentioned that government geologists aren't fired for being wrong when in fact you already knew of an obvious example.

Their recent forecasts haven't been very accurate, either. Their forecasts imply new global discoveries of 22 billion barrels per year, but the actual numbers have been closer to 9 billion barrels per year for the past decade.

Certainly the USGS never built any such deterministic forecast. When you say "their forecasts imply" are you referring to this type of Campbell construction, later used by ASPO?

http://photos1.blogger.com/blogger/4189/1379/1600/USGSYetToFind.jpg

The documentation contained in their 2000 World Assessment specifically EXCLUDES this type of use of the results, so you certainly can't say that they imply this type of construct.

My concern with their current estimates, based on their poor track record, is that they are still being overoptimistic. How could they come up with an estimate of 47 billion barrels in offshore East Greenland?

By using the geologically based studies and methods they specialize in would be my guess. Here is the factsheet:

http://energy.usgs.gov/arctic/

The fractiles of occurrence are not included in these results, unlike their domestic assessments. Perhaps they haven't been published yet? Without some knowledge of the full distribution it is difficult to even make the claim that they are optimistic, means of skewed distributions can exist even if the mode or median volume of occurrence is zero.

I have seen this type of rudimentary calculation done over and over again by people attempting to discredit any numbers which imply that there is more oil and gas left to find.

It is just as reasonable to say, "Heck we've got 12 trillion barrels of oil (Saleri, 2005) on this planet! We've only used 1 trillion so far, we've got 366 years left so why worry?!"

Your point is that 90 billion barrels may not be that much in the greater scheme of things. Mine is that we have so much we don't have to worry for centuries and don't even need the new discoveries.

Both points are accurate and meaningless in what is relevant to society in your lifetime, or mine. So why even post it in the first place?

I still get confused with the way numbers are used (spun?). But my little Joe Average brain understands that drilling in 5000 feet of water (GOM) wouldn't be a first choice for the oil men, if there were easier options.

Where's the other 11 trillion, BTW?

Regards, Matt B

I'm actually not sure. While the professional experience of the source is as good as it gets, industry wise, I'm not familiar with the basis for his numbers. Nehring uses much smaller numbers overall, perhaps half the size, but I haven't asked him the basis for his information either.

Here is the Saleri reference.I deducted off the shale oil out of habit.

http://www.spe.org/spe-app/spe/jpt/2006/04/tech_tomorrow_trillion.htm

Thanks RGR,

But again, too many numbers. Is there a "Peak Oil for Dummies" link available? Simple facts and figures I can pass onto my fellow Joes and Janes....

"12 trillion barrels here, here and probably here".
"We've used this much, will likely get this much more without too much trouble, but gets very tricky after X trillion (or so) is gone".
"At current levels of consumption, the easy stuff has about X years supply left." (With global "growth" of 1%, 2%, 3%... this many years).
"X barrels of oil are consumed for every 100 barrels of tough oil".
And so on.

Cheers.

Hi Joe,

Did you check out the links up top on the TOD home page? (under Peak oil overview.) Gail has posted a number of articles there.

Ah, thanks Aniya!

Hadn't really noticed the side-items before (I've only been coming here for three years!). Probably something to do with other sites and all their blasted advertising.

I used to do a similar thing when "nursing" a crying baby, back when I used to watch TV; just kept absently turning the volume up until the wife growled at me. There's probably a medical term for that.

Regards, Matt B

But again, too many numbers. Is there a "Peak Oil for Dummies" link available? Simple facts and figures I can pass onto my fellow Joes and Janes....

Unfortunately, PO has too much advocacy within it to find any objective short course. Wiki is a disaster, this is about the only website that even allows dissenters to open their mouths, but the most common situation is that definitions are usually ignored even if they are understood, data is censored, the discussions are normally engineered to deliver a cool scenario, and ignoring the actual science on the topic is the norm.

There are a few decent pieces of work which examine PO from an angle other than a OH NOES! THE END IS NIGH!! perspective such as Stephan Gorelicks recent book, but the web is lean on anything objective. Its a big topic, even bigger once you expand it to its proper level, which is resource depletion.

Thanks again RGR,

Yes it's tough, so much to sort through, but even Stephan Gorelicks has his detractors... http://mobjectivist.blogspot.com/2010/05/worst-book-on-oil-crisis-writte....

It's a bit like Mike Moore; he gets you thinking, which is great, but where's the fudge ('coz you suspect there's a bit here and there).

Cheers.

Thanks again RGR,Yes it's tough, so much to sort through, but even Stephan Gorelicks has his detractors

Sure, but thats because Web has a one track mind when it comes to things which aren't related to signal processing or Andrew Grove, geologists are just a bunch of non mathematical dummies who like camping and therefore became geologists.

The specific complaint you list is a prime example, Web acts as though he doesn't even understand the basic processes involved in a modern petroleum "kitchen", which the GOM certainly qualifies as, and then he acts as though expulsed volumes from the organic matter in a petroleum system is somehow abiotic theory. It isn't. Its petroleum geology 101. Forgetting for a moment his oft cited claim that heuristics are bad, he doesn't refute the real points that Gorelick does make. He doesn't refute his statement that oil isn't following any pre-1980 trends (which defeats the "production follows discovery" concept), lack of exploration in the ME compared to NA, reductions in GDP produced per barrel produced (economic efficiency), volumes of unconventionals available which outweigh conventionals and can be developed to the same levels as already demonstrated by heavy-oil development in California, or even something as basic as the substitutability of natural gas for oil?

Go read the book for yourself, its quite reasonable and well referenced. And you don't have to be a math whiz to understand it because lets face it, at the end of the day resource depletion doesn't require much math. Hubbert did it with graph paper and a pencil.

Ha! Thanks, Jon, for saying what we are all thinking...!

an article in the local paper that caught my attention-
Gates foundation ties with Monsanto under fire from activists

it seems that the Gates charitable foundation, the one Bill supposedly has charged with being the vehicle by which he disperses his fortune and aligns himself with the angels, recently made a relatively small ($27 m)investment in Monsanto.

And a local activist group is throwing down an ethical challenge to the foundation.

Much of the foundation's work has avoided major controversy.

That changed when, four years ago, the foundation, along with the Rockefeller Foundation, created the Alliance for a Green Revolution in Africa (AGRA), aimed at alleviating hunger by boosting farm productivity.

The name itself gave some people pause. An earlier Green Revolution that started nearly 70 years ago had similar aims.

Some say that by introducing high-yield crop varieties it averted widespread famine in India and Mexico and helped those countries become more self-sufficient. Critics, on the other hand, say it led to lasting environmental damage and displaced small farmers, to the benefit of corporations that started up large-scale industrial operations.

It is a really important question it would seem to me, and one with powerful, compelling arguments on both sides. The activist group appear to be articulate and media-savvy. However, perhaps they are punching a little above their weight here in trying to put the foundation on the defensive.

Best wishes for honest, ethical debate.

'Technology will provide the energy we need.' True or false?

Anyway, famine was not averted in Mexico by the green revolution. They haven't had a famine problem yet like India and most of Asia face. It has (had) a huge population of subsistence farmers. Mexico abandoned the Campesino system when it joined NAFTA, and now many subsistence farmers are being pushed off their small farms for the producer/consumer life on somebody else's farm or in the big city or in the US.

Small subsistence farms are being bought up and are becoing those chemical wonders Monsanto covets. The small-farm method of sustainable companion planting of corn, beans and squash is ending as these larger farms go for tractors, fertilizer, herbicides and monocropping the Monsanto way.

On the other hand, there's an article about a person who is trying to promote several local landrace varieties of corn in his state of Jalisco. The Gates Foundation is working against this.

I think what this world needs is not more Monsanto, we need a big fat charity to gather, research and distribute more information improvements for subsistence farming, such as the folks at Compatible Technology do. Imagine what a half a billion dollars would do to advance technology for the lowly subsistence farmer? How about free birth control and even abortions for the folks in the countryside?

Famine is in the world's future. It's a bit sad to think, but I believe now that our world would be a better place if the Green Revolution had never happened.

capslock and everyone,

The current issue of The Economist completely disagrees with your assertion that famine is inevitable in the next couple of decades.

The Economist article has provided proof support that the Brazilians have created successful, large-scale agriculture, without much government subsides, and using huge-tract monoculture:

http://www.economist.com/node/16886442

This article has a graph of in-service vs. fallow/credible potential farmland which indicates that only as little as ~ 40% of the World's farmland is in-service. Brazil is shown to have more unused, reserve potential farmland than the next two highest-ranked countries combined. Brazil is represented as having plentiful water, smart productive farmers and farm industry, including a talent at remediating and building soils and cross-breeding crops such as soya to adapt to tropical temperatures and the acidic soils of the Cerrado.

The Economist article implies that Brazil's prowess could be applied elsewhere, such as in certain areas of Africa.

What say everyone?

Barring a nuclear exchange or asteroid strike, doom-by-famine is not in the cards, even at the 9-10 Billion human population level forecast for ~ 2050?

unused, reserve potential farmland

This is just exactly like "oil reserves": I think all TODers are well aware that reserve numbers are just that, numbers, mostly dreamed up out of thin air by some corporate or government grunt worker, whose job it is to lie convincingly enough to fool the rest of the world into complacency.

Look at the source, always. Follow the money, always. Question number one should always be- "Who PAID for the study?"

By any chance, are they referring to the Amazon rain forest as unused reserve farmland?

Does that figure include limitations on transportation from increasing costs of fuel?

Does that figure consider for even a moment that the huge monoculture high intensity paradigm demands inputs of fertilizer from NG? And, the impact of peak gas on that?

Does that report consider, for a moment, the requirement on money for a determined location to import their food from another continent? Or from 1,500 miles away on the same continent? And, the impact of declining incomes on that factor?

It seems to me that the whole thing is a way of saying, the wealthy people will still be able to eat. It is just the po' folks who will starve.

Craig

FWIW and from the other thread: not Amazonia, the Cerrado. Brazil is a huge country, it's not just the Amazon valley. Though if they ever did decide to try to farm large tracts of the Amazon, who could or would stop them?

BTW I wouldn't necessarily expect shipping costs to be a show-stopper anytime soon. Shipping doesn't have to be free, it only has to be cheap enough. Trains and ships may fill that bill for quite some time yet, if not indefinitely. Long-distance shipping is hardly a recent invention.

The Economist article is very interesting. The area of Brazil responsible for its huge increase in agricultural production is called the cerrado, a vast area of marginal scrub brush 1000 kilometres from the rain forests. Historically it was regarded as unfit for farming, but today it accounts for 70% of Brazil's farm output.

The Economist's point is that the Brazilians took all the cliches about small farms and organic practices and threw them out the window. Their approach is farming on a vast industrial scale (farms of hundreds of square kilometres) using tons of chemicals and heavily modified plants and animals. They took tropical grasses from Africa and cattle from India, among other things, and bred them to be several times as productive as they originally were. They took soybeans, which are a temperate zone crop, and modified them to produce two crops a year in the tropics, in hot acidic soil they couldn't originally survive in. They plow in tons of lime per hectare to neutralize the soil, and then add specially modified nitrogen-fixing bacteria to provide fertilizer.

As a result, Brazil has gone from being a net food importer to the worlds largest exporter of cattle, poultry, sugar cane, and ethanol. It now accounts for 85% of the world's exports of orange juice, 45% of global sugar exports, and almost 40% of soybeans and chicken exports. It is now an agricultural superpower rivaling the US, Canada, and Australia.

The Economist also makes the point that, since Brazil is a tropical country which has bred African and Indian plants and animals for much higher productivity, the new varieties could be taken back to Africa and India, where with the Brazilian agricultural techniques they would produce much higher yields, on farmland that formerly was useless.

Of course, the touchy-feely small-organic-farms-are-best crowd would just hate that, particularly after all the genetic modifications the Brazilians have done (Brazil is the second largest user of GMOs after the US), but it obviously does work.

Big is beautiful

Like almost every large farming country, Brazil is divided between productive giant operations and inefficient hobby farms.

There you have it (source)

The Economist magazine is there to "plant" the idea that Big is always "Beautiful" while small is "inefficient".

Funny how the same theory magically does not apply to unions.

(The Universe is full of mysteries too deep for our feeble brains to cope with.)

I grew up on a farm, and many of my relatives are still farming, so I find city people are incredibly naive about the realities of farming.

Modern farms are basically giant food factories. It is a very capital and machinery intensive industry. The only way to make any money at it is to operate on a huge scale using the latest technology and techniques. It is one of the most technology-intensive industries in the world, and there are huge economies of scale. It has been going this way for at least the last 100 years.

As for small farms, I remember the apocryphal story of the small farmer who won $1 million in the lottery. The reporters asked him, "What are you going to do with your winnings?" and he replied "Well, I suppose I'll just keep on farming until it's all gone."

I find city people are incredibly naive about the realities of farming.

You are absolutely right. I am a city slicker. Never seen a big ag operation.

On the other hand, I take it that the age of the combine driven by cheap oil is near over.

And many here are proposing a return to localized perma culture.

So we have two groups heading in two opposite directions

And basically you're saying, they are both going to fail?

So what is the answer?

Re: Ethanol Futures Soar to Seven-Month High in U.S. on Increased Corn Demand, up top.

As E-10 gas hovered around $2.60 to $2.70 is was possible to save a few pennies with E-85 under $2.00. But not anymore. We are back to the familiar situation where there is no gain for the E-85 user and likely a loss.

E-10 is about $2.50 around here and E-85 is now back over $2.00. They are the break even prices since E-85 gets about 80 percent of the mileage of E-10.

More show and tell about renewable energy infrastructure around here:

Valero is a hybrid energy company combining oil and ethanol. Some of my corn ends up at their Fort Dodge plant because North Central Coop
of Clarion owns the Woden elevator where I deliver some corn.

http://www.valero.com/default.aspx

Valero bought the plant after Vera Sun filed for bankruptcy a while back. They also bought the former Vera Sun plant at Charles City.

Valero Renewable now owns 4 ethanol plants in Iowa each of which can produce 110 million gallons for a total of 440 million gallons. Each plant consumes about 40 million bushels so about 160 million are used in total.

Ethanol Soars to Seven-Month High on Increased Corn Demand talks about the idea of increased US demand for ethanol because of E-15.

I cannot see how E-15 will really make a difference. I expect it to be as much of a "dud" as E-85. The first reason is exactly the reason you mention. If E-15 costs as much or more than E-10 per mile driven, why buy it?

But there are other problems as well. I understand that the EPA is testing E-15 for how it works with the catalytic converter and other parts of the emission system, and on the basis of these tests, may permit its use on 2007 and more recent model years, but the EPA hasn't done testing on whether ethanol's use will damage the car. Those tests are being done by a group which includes car manufacturers, and won't be done until 2011. There are also tests being done on how it will affect the fueling station infrastructure, and those won' t be done until 2011, either. At this point, using E-15 would void manufacturers' warranties on 2007 and subsequent cars. Even if the EPA somehow over-rides this problem, repairs outside of warranty will still be an issue.

Another problem is that this is going to be a big hassle for service stations. They will need separate stations for E-10 and E-15, and separate tanks underneath, at significant extra cost. They will need clear signs as to who can use the E-15, and some way to make certain that there are not folks who accidentally use E-15 in a car that is too old to tolerate it. Even at that, there are likely to be damage claims by some who accidentally got E-15 when their vehicle could not use it. So why would a service station go out of its way to add E-15?

We all remember 'Mr. Fusion' from the 'Back to the Future' movies.

Well I have question. Assuming we discover 'easy' fusion, given our regulation, cost allocation and recovery models, could such a device ever get produced or become affordable. Would it end up like the Valkyrie bomber or the Sea Wolf submarine? These machines could have had a place if the price tag was lower. Is such a machine statistically impossible to produce given the current hydrocarbon models we live with? Would BP hire a hitman to take out the Professor. Would Newmann or Dudley 'buy him out' and bury it? Would the stockholders indirectly demand it? The government? I am not saying conspiracy, I am saying corruption and greed. Interesting hypothetical discussion, or is it only hypothetical?

Neither the B-70, nor the SeaWolf, nor the Future Combat System, nor any other weapons system has or ever will make a profit for its owners/users.

Weapons systems are money sinks...its called Operations & Maintenance and disposal costs.

Research, development, Test, and evaluation (RDT&E) costs are dwarfed by total life cycle O&M & disposal costs.

The only revenue made from weapons systems is for the contractor(s) which produce and sustain it.

A 'Mr. Fusion', on the other hand, would produce revenue for sure...the whole question is whether it would ever produce a profit!

In this day and age, killing an inventor is an exercise in futility. You then find out just how many dispersed backups he made of his works, and next thing you know it all gets posted to Ars Technica, and you've done more to bring attention to his invention than he might have himself. If you know someone is inventing something that will compete with your product, the smart thing to do is invest in his work.

That said, it might never have been wise to try killing an inventor. That whole cliche should have died with the same inventor whose death provoked it: Rudolf Diesel.

And as for fusion, it generates more than just energy. It generates enough radiation that even a cold fusion machine still requires containment in a healthy amount of metal and concrete. If we figure it out, most of our peak oil worries will dissolve in an Emily-Litella-ish "Never Mind." But we'll still be left with a world that cannot support an automobile economy. We'll still need to learn to run our affairs on tracks, with overhead wires and third rails.

...the same inventor whose death provoked it: Rudolf Diesel.

This seems really, really curious, if true. After all, his US patent application disclosed the invention in 1892, while his death was in 1913. Now, I realize that conspiracy nuts are often the very nuttiest kind, almost a species apart really, but still, how mutant must a nut be, to be even capable of holding seriously that someone was killed in 1913 to hide an invention already disclosed some 21 years before?? Is there a (reputable) history of this somewhere?

Conspiracy theories began to fly almost immediately: “Inventor Thrown Into the Sea to Stop Sale of Patents to British Government,” read one headline; another worried that Diesel was “Murdered by Agents from Big Oil Trusts.” It is likely that Diesel did throw himself overboard--as it turns out, he was nearly broke--but the mystery will probably never be solved.

http://www.history.com/this-day-in-history/inventor-rudolf-diesel-vanishes

History Channel, good as any. They provide a contact for corrections and updates.

Although he patented it in 1892, his patent on the diesel engine expired 18 years later in 1910. If he hadn't made any money on it by 1913, and everyone else was getting rich from his invention, no wonder he felt an urge to kill himself.

hire a hitman to take out the Professor. ... 'buy him out' and bury it?

This is an all too common corollary to the
2. "Technology will save us" meme

It tries to explain away why Technology has not saved us.

You see, there was this guy that invented a way to run your car on water, but the government/ big business/ boogey people took him out /bought him out / etc/

Problem is that this "conspiracy" meme does not mesh well with reality.
In the real world Doc Brown (unless he is a fraud) would file for patents all around the world on his invention and everybody would quickly become aware of it. There would be no easy way to bury it.

Exactly. To clarify, what they're saying is not "Technology will save us" but that at least technology COULD save us if only (fill in the blanks with the appropriate boogeyman) didn't secretly intervene.

I suspect we'll have a lot of that thinking all the way back down to Olduvai Gorge. It's much more appealing to play the martyr than to concede limits to growth.

You see, there was this guy that invented a way to run your car on water, but the government/ big business/ boogey people took him out /bought him out / etc/

Conspiracy? Stan Meyer and the Mysterious, Elusive Electrolyzer