Drumbeat: November 17, 2010
Posted by Leanan on November 17, 2010 - 10:00am
(Reuters) - Brazilian state oil company Petrobras expects crude oil exports to rise to 800,000 barrels per day by 2020 as new oil production from vast offshore fields comes online, a company director said on Wednesday.
Petrobras is currently both an importer and exporter of crude oil, but imports are slated to halt by 2014 as oil output from the offshore region known as the subsalt displaces light crude purchases from Iraq and Saudi Arabia, Petrobras Supply Director Paulo Roberto Costa said.
Do you ever get the feeling that some people want the world to run out of oil, really really soon? That runs through my mind sometimes with the flood of peak-oil material at conferences, in books and in the media. Among the latest are a couple of new reports with yet more alarming findings. The headline: We're in trouble.
Crude oil declined to a four-week low on speculation that China will raise interest rates, slowing economic growth in the world’s biggest energy-consuming country.
Oil fell 2.3 percent after Chinese Premier Wen Jiabao said the government was drafting measures to counter inflation. Prices also dropped on concern Europe’s debt crisis is worsening as ministers considered a rescue package for Irish banks. U.S. crude supplies slid 7.29 million barrels to 357.6 million last week, an Energy Department report showed today.
MOSCOW -(Dow Jones)- Russia plans to harmonize its oil and gas reserves classification with international standards by 2012, the Resources Ministry said Wednesday.
"From 2012, Russia should introduce a new classification of hydrocarbon reserves in harmony with international SPE [Society of Petroleum Engineers] PRMS standards," said Grigori Vygon, head of the ministry's economy and finance department.
Russia is checking documents that suggest at least $4bn (£2.5bn) of state funds was stolen during the construction of a big oil pipeline.
Moscow blogger Alexei Navalny claims he has obtained documents that reveal the theft was uncovered in a 2007 audit of the East Siberia-Pacific pipeline.
NEW YORK (AP) — Exxon Mobil Corp. has agreed to pay $25 million to resolve complaints over its handling of a huge underground oil spill in New York City.
The deal with Attorney General Andrew Cuomo and the environmental group Riverkeeper will resolve several years of litigation over spills from refineries that once lined the Brooklyn waterfront.
(Reuters) - Claimants to BP Plc's $20 billion oil spill fund may soon be required to transfer to the company their right to sue other defendants, a move that could help BP's efforts to collect billions of dollars from its business partners.
A sorry catalogue of technical, safety and regulatory failures all contributed to the Deepwater Horizon oil spill in the Gulf of Mexico, according to an interim independent report commissioned by the US Department of the Interior and published today.
Despite a deep economic recession, the U.S. green building market has expanded dramatically since 2008 and is projected to double its size by 2015, says a new report by McGraw-Hill Construction.
Almost every winter, China's energy market suffers a new variant of the same no-win situation as state controls exacerbate supply shortages that only urgent and pricey imports can relieve. This year it is diesel that is scarce.
A spike in demand for diesel-fired power generation has caused a supply shortage that could last well into 2011, forcing Chinese refineries to import the fuel for the first time in nearly two years and to consider tapping state fuel reserves.
Despite cold weather and rising fuel costs, a state campaign to stamp out energy wastage has prompted officials in many provinces to cut power supplies to factories, businesses and even homes and public facilities.
Many big power users have simply switched to stand-alone diesel generators, which fly below the radar of the official campaign focused mainly on coal-fired electricity.
Global production of crude probably peaked in 2006, and increasing demand will have to be met from more-difficult-to-extract forms of oil such as tar sands, International Energy Agency Chief Economist Fatih Birol said.
“The age of cheap oil is over,” Birol said at a conference in Madrid today.
MOSCOW (Reuters) - Russia's government approved a plan on Wednesday to sell around 1 trillion roubles ($31.9 billion) in state assets over the next three years to plug a gap in the budget deficit and lure foreign investors.
Russian leaders need cash to ratchet up growth ahead of the 2012 presidential election, in which former president Vladimir Putin has hinted he may stand.
Economy Minister Elvira Nabiullina said following a cabinet meeting chaired by Prime Minister Putin that the plan -- which includes stakes in the country's two biggest banks, main oil producer and railways monopoly -- had been approved.
A team of engineers and forensic analysts Tuesday launched a high-profile autopsy of the blowout preventer from the Deepwater Horizon as part of a bid to find out why the 50-foot, 300-ton device failed to cut off flowing oil and natural gas at BP's Macondo well.
REDMOND, Wash. — "Your mileage may vary" ... That old phrase is even more relevant for the newfangled Nissan Leaf electric vehicle, which has an advertised range of 100 miles on a charge. In fact, the mileage depends quite a bit on your driving style, and the numbers can go up and down in the course of a drive.
Yes, it's possible to get 100 miles or more from the Leaf. But if you're the kind of guy who keeps the car on the road even if the needle is near the "E" mark, you might have to change your ways.
Berlin operators are calling for Germany's first offshore wind farm Tuesday urging the German government to increase incentives to expand the generation of renewable power at sea.
Utilities Eon, EWE and Vattenfall in a statement called on Berlin to improve the financial and regulatory framework so that more offshore wind farms can be launched in Germany.
Some of the bickering about the energy crisis, the smart-alec gimmicks, and the "if" arguments make one wonder ... about the sturdy nature and future of our democracy.
We advance matters which are interesting but academic - such as "if" we all had small cars, the problem would be solved. We don't all have small cars, and that kind of a conversion would take years. In fact, the years ... are such that by the time they passed the adjustment wouldn't solve anything. By then we will ABSOLUTELY NEED new sources of energy anyway ...
Let’s say you don’t like oil from countries that don’t like us, or from the oil sands of Canada. Let’s say that you don’t want any offshore oil drilling. Maybe you don’t like coal fired power plants. You may not want any energy from nuclear power because you believe it is dangerous or you worry about toxic waste. You don’t want any concentrated solar facilities on pristine California desert, or noisy windmills to disturb the peaceful island life of Vinalhaven, Maine. Maybe you want to zone your community to prevent unattractive solar panels from appearing on your neighbor’s roof. You may not like to use corn to drive to the store when the world’s per capita grain supply is dwindling. If you are uncomfortable with the trade offs of any or all of these energy sources, what can you do?
Two of the three North Shore mayors attended the conference along with mayors from Bowen Island and Lions Bay who discussed various plans for developing community gardens, farms or other agri-urban initiatives. But one of the most insightful comments came from Mayor Richard Walton when asked by members of the audience: What effect will peak oil and climate change have on food security? Walton said, "The next oil crisis like the one in the 1970s will show us just how important local food production is." Before I could pause to think, I heard someone near me say, "How will we get food onto the North Shore if there's no gas?" That was a startling comment delivered ad hoc from the crowd, but it gave everyone reason to pause and made the rest of day's discussions much more important.
WASHINGTON — A far-reaching food safety bill that could give the government more power to prevent foodborne illnesses has become a target of advocates for buying food produced locally.
They worry the legislation's safety requirements could force small farms out of business.
There Will Be Fuel: Energy, and Plenty of It, for Decades to Come
THREE summers ago, the world’s supertankers were racing across the oceans as fast as they could to deliver oil to markets growing increasingly thirsty for energy. Americans were grumbling about paying as much as $4 a gallon for gasoline, as the price of crude oil leapt to $147 a barrel. Natural gas prices were vaulting too, sending home electricity bills soaring.
A book making the rounds at the time, “Twilight in the Desert,” by Matthew R. Simmons, seemed to sum up the conventional wisdom: the age of cheap, plentiful oil and gas was over. “Sooner or later, the worldwide use of oil must peak,” the book concluded, “because oil, like the other two fossil fuels, coal and natural gas, is nonrenewable.”
But no sooner did the demand-and-supply equation shift out of kilter than it swung back into something more palatable and familiar. Just as it seemed that the world was running on fumes, giant oil fields were discovered off the coasts of Brazil and Africa, and Canadian oil sands projects expanded so fast, they now provide North America with more oil than Saudi Arabia. In addition, the United States has increased domestic oil production for the first time in a generation.
Futures retreated as much as 1.4 percent after Chinese Premier Wen Jiabao said the government was drafting measures to counter inflation in the world’s biggest energy consumer. Prices also fell on concern Europe’s debt crisis is worsening as ministers considered a rescue package for Irish banks. U.S. crude inventories dropped the most since September 2008 and gasoline demand increased, reports showed yesterday.
“Risk is being taken off the table across the entire commodities complex as the dollar gets stronger,” said Carsten Fritsch, an analyst with Commerzbank AG in Frankfurt. “In such an environment fundamentals such as the sharp drop in crude stockpiles don’t matter.”
Coal in Europe is trading close to a two-year high as rising demand in China drives up prices around the world, making natural gas more attractive to U.K. and German utilities for producing power.
NEW YORK (CNNMoney.com) -- Consumer prices for everything other than food and energy experienced their smallest annual increase on record in October, the Bureau of Labor Statistics said Wednesday.
BEIJING – China's government announced food subsidies for poor families Wednesday as it tries to cool a double-digit surge in prices that communist leaders worry might stir unrest.
The Cabinet promised to ease shortages of vegetables and grain that helped push up food prices by more than 10 percent in October. It promised more supplies of diesel to end fuel shortages that have disrupted trucking and industry.
A major North Sea gas field has been shut down because production could break European Union sanctions against Iran.
LAGOS, Nigeria—Five people were killed in an attack in Cameroon on a boat carrying guards for an offshore oil field operated by French firm Perenco SA, the company said Wednesday.
The attack late Tuesday night came as the vessel operated at an oil field abutting Nigerian territorial waters, possibly signaling that militants waging attacks in recent days from that country's oil-rich Niger Delta may have targeted the crew. However, no militant group immediately claimed responsibility for the assault.
ORANGE BEACH, Ala. (AP) -- What's typically a beautiful, quiet stretch of beach in the fall now resembles a construction site. Bulldozers and yellow dump trucks shake the ground; a giant sifting machine spits clean sand out one end, tar balls out another.
With its Macondo well dead and few visitors on the coast during the offseason, BP has launched its biggest push yet to deep-clean the tourist beaches that were coated with crude during the worst of the Gulf oil spill. Machines are digging down into the sand to remove buried tar mats left from the Deepwater Horizon disaster.
PHILADELPHIA (Reuters) – The Pittsburgh City Council voted unanimously on Tuesday to ban natural gas drilling in the city amid concern about threats to water quality.
By a vote of 9-0, the council adopted an ordinance that would prevent any energy company from drilling a gas well within city limits.
UNDERGROUND oil and gas pipelines are an often-forgotten part of the nation’s energy infrastructure — until problems occur. This year has seen a spate of attention-getting accidents. In San Bruno, Calif., a gas pipeline exploded in a residential area in September, killing eight people. In Texas, two gas pipeline accidents within a day of each other in June killed three people. In Michigan, an oil pipeline ruptured this summer, spilling hundreds of thousands of gallons of oil into a river.
Oil and gas industry experts say that despite these problems, pipelines keep getting safer as technology improves.
WASHINGTON – BP and its contractors missed and ignored warning signs prior to the massive oil well blowout in the Gulf of Mexico, showing an "insufficient consideration of risk" and raising questions about the know-how of key personnel, a group of technical experts concluded.
In a 28-page report released late Tuesday, an independent panel convened by the National Academy of Engineering said the companies failed to learn from "near misses" and neither BP, its contractors nor federal regulators caught or corrected flawed decisions that contributed to the blowout.
Massachusetts-based companies received twice as much money in federal contracts stemming from the BP Plc oil spill as the combined total of the five Gulf of Mexico states where the oil washed up, according to data compiled by Bloomberg Rankings.
The panel named by President Obama to investigate the BP Deepwater Horizon blowout on Tuesday rejected a call by a consumer activist group for the resignation of its chief counsel, Fred H. Bartlit Jr. The group, Consumer Watchdog, said that the panel should dismiss Mr. Bartlit because his law firm, Bartlit Beck Herman Palenchar & Scott, once represented Halliburton, one of the companies involved in drilling the BP well.
China National Offshore Oil Corp., the nation’s largest offshore producer, plans to expand overseas oil and gas exploration next year, the company said in a statement on its website.
ON the coasts, states are limiting carbon dioxide output, banning new coal-fired power plants and building wind turbines to fend off global warming. But here in the heartland, thousands of workers are building a $4 billion new coal plant with a 700-foot chimney, 70 feet higher than the Gateway Arch in St. Louis.
The Obama administration plans to reallocate money designated for high-speed rail if the states granted the funds reject them.
Tougher pollution-reduction requirements, advances in diesel engineering and heightened interest in overall fuel economy among American car buyers are helping to burnish the otherwise dirty, smelly and highly polluting reputation of diesel cars.
The new, electric version of the Toyota RAV4 will be put together in California, the auto maker is expected to announce Wednesday, dealing Ontario another setback in its attempt to grab a slice of the growing investment in electric vehicles.
On the eve of the market debut of the Nissan Leaf electric car, Carlos Ghosn, chief executive of the Renault-Nissan alliance, said the only constraint on sales for the next three years will be how many battery packs the factories could churn out.
China’s biomass use, which the government excludes from its consumption estimates, placed the country ahead of the U.S. as the world’s largest energy consumer in 2009, the International Energy Agency said.
Inclusion of “traditional biomass use” in rural areas, such as the burning of grain stems or wood for cooking, increases China’s energy consumption by four to five percent, Nobuo Tanaka, executive director of the Paris-based adviser said at a press conference in Beijing today. Biomass is material made from organic matter.
Madrid, Spain – The Spanish government has launched a new regulatory framework that will result in subsidized tariffs for ground-mounted solar energy projects drop 45% this year, killing future investment in the trade, which industry leaders expect will be frozen in the next few years.
When the economy hit the skids in 2008, one of the casualties was the federal government’s main mechanism for subsidizing renewable energy, tax credits.
So to tide the industry over the recession, Congress stipulated in the Recovery Act that for the next two years, it would give the help in the form of grants instead of tax credits.
The two years are about over but the economic woes are not, so the solar industry is asking for a two-year extension.
Now a San Francisco company, CleanPath Ventures, is promoting a solution to allow homeowners to keep their trees and go solar at the same time. CleanPath plans to expand its existing solar farm on the city’s outskirts and then sell “garden plots” to homeowners who would own the electricity generated by their patch of photovoltaic panels. Apartment dwellers and other residents whose homes are not suitable for rooftop solar arrays would also be able to own a piece of the power plant.
NIPTON, Calif. - ON the construction site of the $2 billion Ivanpah solar power plant here, burly laborers slowly walk around their trucks, dropping to their knees to peer underneath before turning the ignition. Hanging on each rearview mirror is a placard warning workers to “Look under your car for desert tortoise before you drive away!”
Road graders and backhoes crawl along at 10 miles per hour, led by biologists wearing green hard hats who scan for tortoises in a landscape studded with creosote bushes. “Nobody is allowed on the site without a biologist to escort them,” said Mercy Vaughn, the lead biologist for BrightSource Energy, the Oakland, Calif., company that is building the 370-megawatt power plant, the first large-scale solar thermal project to break ground in the United States in two decades.
(Reuters) - Member states of the U.N. nuclear watchdog are expected to approve next month a U.S.-backed fuel supply plan seen as a way to help prevent the spread of atom bombs, despite misgivings among some developing countries.
Western diplomats said the stalled proposal to set up a $150 million nuclear fuel bank run by the International Atomic Energy Agency (IAEA), which countries could turn to if their regular supplies were cut, was still being discussed.
THE outspoken supporters of nuclear power are mostly Republicans, and the Republicans are about to take control of the House of Representatives and gain six seats in the Senate. Is this good news for nuclear power?
Maybe. But the outlook for a new wave of reactors is still mixed at best.
EARLIER this month, Global X Funds of New York announced plans for two exchange-traded funds — one for gold stocks, the other, uranium. Initially, Bruno del Ama, its chief executive, figured he knew which would capture the market’s attention. After all, gold prices have surged in recent months.
As it transpired, he guessed wrong. Global X’s Uranium E.T.F. — with holdings in companies like the Cameco Corporation, Paladin Energy and Uranium One — was a hit as soon as it went on sale Nov. 9, with early trading volume outpacing Global X’s gold E.T.F. by five to one. “I’m in shock, to be honest,” he said.
In a worst case, a major geomagnetic storm “could be perhaps the largest natural disaster this country could face,” said John G. Kappenman, a consultant to the power industry. It could cause regionwide or larger blackouts, potentially for months, and affect grids on other continents as well.
The European Union outlined today its energy infrastructure priorities for the next two decades, paving the way for aid for supergrids to integrate renewable energy and routes to deliver natural gas from the Caspian Sea.
BEIJING—A Chinese trade organization Wednesday said a U.S. government investigation into subsidies China provides for its renewable energy companies was baseless and would hurt China-U.S. cooperation.
The huge fiscal divisions that were already in evidence at the G20 summit in Toronto have morphed into even bigger and more rancorous divisions on exchange rates at the recent Seoul summit. With America at China’s throat about a record trade surplus and China at America’s throat over the Federal Reserve Board’s blatantly devaluationist policy of quantitative easing, little wonder nothing was accomplished.
More importantly, it likely marks the end of the great China-U.S. economic accord which defined the apex of globalization. That once virtuous and self-reinforcing circle of trade and capital flows, whereby Chinese savings invested in the Treasuries market effectively funded U.S. consumer demand for Chinese exports, is clearly in both countries' gun sights these days.
The peak oil debate has spurred a tremendous amount of debate. Now it's spurred a book.
I was delighted recently to have a conversation with Maurice Poulin around the renovations he has undertaken in his family’s downtown building holdings. Poulin is a businessman — he’s not an environmentalist, he’s a pragmatist. While he concedes climate change and peak oil are happening, he does not believe we are in a crisis. But he does believe in reducing his long term risk. He has done that, and at the same time improved his bottom line, helped in mitigating greenhouse gas emissions and made life better for his tenants.
I've been reading Richard Heinberg's book about peak oil. "The Party's Over: Oil, War and the Fate of Industrial Societies," helped me see that the Amish are definitely on to something. The peak oil thesis holds that because our civilization is rooted in finite energy sources, increasing competition for energy cannot help but trigger dangerous political and economic crises. The Amish can look at this and shrug while the rest of us must be deeply concerned.
The logic of peak oil is compelling even if the date when that peak will be reached is a matter of dispute because both supply and demand considerations will affect the reality of peak oil. The International Energy Agency (IEA) predicts in its World Energy Outlook 2010 that oil demand will continue to grow until 2035 when it will reach about 99 million barrels per day.
California agriculture is in serious trouble, while the state's population is ballooning, the head of a group that advocates sustainable agriculture told a conference in Seaside on Monday.
"How are you going to feed these people? We need to do something about this," said Dave Henson, founder of the Occidental Arts and Ecology Center in Sonoma County, during the Sustainable Ag Expo held at the Embassy Suites Hotel Monterey Bay.
When looking at the challenges of peak oil and climate change it is important to consider a systems approach. A systems approach means that we look at all parts of the Earth, our society, our families and our lives as being interconnected and affecting one another.
Systems thinking allows us to see that all our actions are connected and affect the whole.
(AP) -- States with coastal water that is becoming more acidic because of carbon dioxide should list them as impaired under the Clean Water Act, the U.S. Environmental Agency said.
The federal agency's memo Monday to states recognizes carbon dioxide as not only an air pollutant but a water pollutant, and notes the serious impacts that ocean acidification can have on aquatic life.
A new report concerning a warming climate's impact on Lake Tahoe comes with some worrying predictions, including that the Reno area could be cut off from its primary water supply for up to 20 years at a time.
NRG Energy Inc., the largest U.S. independent power producer, and Barclays Plc have completed the first deal for carbon-dioxide permits under California’s planned cap-and-trade program for greenhouse gases.
A report says global warming could make India two degrees Celsius warmer on average within 20 years, though some coastal regions could see much higher temperatures.
Environment Minister Jairam Ramesh says the new report shows India is among the most vulnerable countries to climate change.
There is no better example of how human ingenuity can literally keep our heads above water than the Netherlands. Although a fifth of their country lies below sea level - and fully half is less than three feet above it - the Dutch maintain an enormously productive economy and enjoy one of the world's highest standards of living. The secret is a centuries-old system of dikes, supplemented in recent decades by an elaborate network of floodgates and other barriers. All this adaptation is not only effective but also amazingly inexpensive. Keeping Holland protected from any future sea-level rises for the next century will cost only about one-tenth of 1 percent of the country's gross domestic product.
(CNN) -- Good news for everyone who loves a barbecue: soon you could be helping save the world as you flip your burgers.
A new generation of small, barbecue-style stoves could soon be making it possible to sequester carbon while you cook -- with the added advantage of producing fertilizer for your garden in the process.
A group of international investors responsible for more than $15 trillion in assets called Tuesday for the world's nations, particularly the United States, to move decisively to combat climate change or face economic disruptions worse than the global recession of the last two years.
BERKELEY — Dire or emotionally charged warnings about the consequences of global warming can backfire if presented too negatively, making people less amenable to reducing their carbon footprint, according to new research from the University of California, Berkeley.
"Our study indicates that the potentially devastating consequences of global warming threaten people's fundamental tendency to see the world as safe, stable and fair. As a result, people may respond by discounting evidence for global warming," said Robb Willer, UC Berkeley social psychologist and coauthor of a study to be published in the January issue of the journal Psychological Science.
BERLIN (Reuters) - Climate change could lead to colder winters in northern regions, according to a study by the Potsdam Institute for Climate Impact Research on Tuesday.
Vladimir Petoukhov, lead author of the study, said a shrinking of sea ice in the eastern Arctic causes some regional warming of lower air levels and may lead to anomalies in atmospheric airstreams, triggering an overall cooling of the northern continents.
The idea that the world's glaciers and ice caps move ever-so-slowly is so securely ingrained in our thinking that we have given it metaphorical status. To say that something moves at "a glacial pace" is a way of saying that it hardly moves at all.
This is the way many people feel about our global climate as a whole -- something that is moving along at an almost imperceptible rate of change, possibly posing some nominal threat to somebody else in some distant future.
...For climate scientists, however, among people actually doing work in the field, a lot of the argument and the thinking about the pace of change is going in the opposite direction -- global climate is changing faster, bigger, and sooner rather than later.