Drumbeat: March 18, 2011
Posted by Leanan on March 18, 2011 - 9:35am
Crude's watchdog ready to bark
Fatih Birol, his glasses twitching below bushy eyebrows, is standing at a podium in Abu Dhabi. He is the "Cassandra of crude".His mission: to warn of the dangers of using too much energy. It is a position he takes around the world, speaking to whoever will listen. His mantra: "One day, we will run out of oil."
Oil Surges as UN Approves Libya No-Fly Zone; Credit Suisse Raises Forecast
Oil surged to its highest price in a week in New York after the United Nations Security Council approved military intervention to protect civilians in Libya, holder of Africa’s largest crude reserves.Futures jumped as much as 2.2 percent after the UN voted to establish a no-fly zone over Libya and demanded a cease-fire with rebels. Oil pared gains after China took steps to cool growth, raising banks’ reserve rate requirement a third time this year. Credit Suisse Group AG raised its forecast for Brent crude traded in London, citing Middle East unrest.
Japan's Idemitsu plans full output amid fuel shortage
(Reuters) - Japan's Idemitsu Kosan Co said it will raise the run rate at its four refineries across Japan to full production this week to help ease a severe oil shortage in eastern Japan after a powerful quake last Friday.
Indonesia may export surplus Bontang LNG to quake-hit Japan
(Reuters) - Indonesia may export surplus liquefied natural gas (LNG) from its Bontang plant to quake-stricken Japan, Evita Legowo, director general for oil and gas at the energy ministry said on Friday.
As Japan’s nuclear crisis follows Gulf oil spill, Obama struggles for accord on energy
WASHINGTON — On the road to a national energy policy, President Barack Obama is hitting pothole after pothole.
PetroChina Plans to Add Oil, Gas Assets as Japan Earthquake Boosts Demand
PetroChina Co. pledged to accelerate acquisitions of energy assets and develop the country’s domestic natural gas resources as demand for the fuel rises following Japan’s nuclear reactor crisis.
Oil Industry to Form Safety Group
American companies involved in offshore oil drilling are moving to set up a safety institute modeled on those established by foreign oil companies and the nuclear power and chemical industries, the American Petroleum Institute said on Thursday.
Petrobras told it can use deep-water vessel in Gulf
Petrobras has received final approval to operate the Gulf of Mexico's first floating production, storage and offloading vessel, clearing the way for the Brazilian oil giant to start pumping oil from two deep-water fields, federal regulators said Thursday.
Prompt military moves afoot over Libya
(CNN) -- Military action against the Moammar Gadhafi regime could begin in the coming hours, a French government spokesman said on Friday, hours after the U.N. Security Council authorized the use of force to protect besieged civilians in Libya.
The days of $100 oil may be here to stay
Libya may soon cease to be a player in the oil markets, and that’s bad news for anyone who fears that rising oil prices will stall the global oil markets.
We thought we’d point out ahead of time that there are several provisions in Security Council resolution 1973 that allow for this escalation, with broad implications for infrastructure and rebels’ chances of quickly supplanting Gaddafi.
The fatally flawed logic of a no-fly zone
Much to his detriment, President Obama has been sitting on the fence regarding the Libyan civil war. The president should have had the courage of his convictions to say that although his sympathies and the sympathies of the American people are with those Libyans who desire freedom, human rights and democracy, this is a fight that only Libyans can win. Unfortunately, if Thursday's statement from US Ambassador to the UN Susan Rice is any indication, Obama has caved to misguided and poorly thought-out arguments for direct intervention.
US and its allies are too late to help Libya
The belated US decision to support Anglo-French proposals for a Libyan no-fly zone seems no more than a cynical gesture.Washington concedes that merely grounding the Tripoli regime’s aircraft and helicopters may not change outcomes.
But the situation today is where it always was: once Muammer Gaddafi showed himself determined to fight, only direct ground intervention by the US and its allies would have enabled the ill-armed rebels to prevail.
Libya's once-promising economy quickly turns bleak
Libya's currency is down 30 percent in just two weeks, its oil has slowed to a trickle, its bazaar is eerily empty, and the shops are increasingly bare.In the span of less than a month since the rebellion started, a once-promising economy has turned around. Before, cranes dotted Tripoli's skyline and luxury housing projects were on offer, loans backed by foreign bank branches in the city; now bread lines run long and the bakers have fled across the borders.
Middle East crisis could delay Naimi’s retirement
As oil traders braces for fresh geopolitical turmoil, Ali Naimi, the veteran oil minister of Saudi Arabia, will be once again on the spotlight to reassure the market.
GM to shut plant amid shortage of Japanese parts
NEW YORK (CNNMoney) -- General Motors has suspended production at a facility in Louisiana due to a shortage of parts stemming from the natural disaster in Japan, the automaker said Thursday.
Japan Earthquake May Cause Prius Shortage
It may soon become much harder to get your hands on the wheel of a Prius. The earthquake and tsunami that have caused over 10,000 deaths, swept away whole towns and plunged Japan into a nuclear crisis will have an impact, albeit a much less dire one, on U.S. car buyers as well: the best-selling hybrid car in America could soon be out of stock.
Smaller engines account for 46 percent of Chevrolet retail sales
It’s official. Chevrolet sales stats prove consumers are indeed moving toward fuel-efficient 4-cylinder engines to save on their transporation budgets. Question is, what's next?
Oil is up. Where's the demand for electric cars?
Of course, we've seen this story before. Every time gas prices fluctuate this wildly, there's the inevitable chatter about a fundamental change taking hold in the U.S. auto industry -- about a turn to alternative and low-emission cars and a consumer base that has finally and forever turned its back on the gas guzzlers of yore. Except things never quite work out that way.
Rising oil prices threaten economic crash
A sustained oil price of $100 per barrel will add $520 billion to the U.S. balance-of-trade deficit. Furthermore, there is a direct and well-established relationship between unemployment rates and the rates of mortgage defaults. Thus, the $130-per-barrel oil shock of 2008 didn’t just throw 5 million Americans out of work, it made many of them default on their home payments and thus destroyed the value of the mortgage-backed securities held by America’s banks. This, in turn, threatened a general collapse of the financial system, with a bailout bill for $800 billion sent to the taxpayers as a result. But that is not all. The destruction of spending power of the unemployed and the draining of funds from everyone else to meet the direct and indirect costs of high oil prices reduce consumer demand for products of every type, thereby wrecking retail sales and the industries that depend upon them.
UK regulator eyes energy networks price controls
LONDON (Reuters) - Britain set out plans on Friday to control prices on the country's sustainable energy networks, in a move aimed at saving consumers some 1 billion pounds ($1.61 billion) over the next eight years.
Fuel poverty and social inequality should be the focus – not fuel cost
Fuel duty and VAT increases always make for great political bun fighting in the week before a budget, but yesterday’s opposition day debate failed to excite. The focus continues, understandably, to fall on the short-term issues around the cost of fuel but fails to take a bigger picture perspective and look long-term at oil dependency, fuel poverty and the evident lack of choice available to the British public.
Peak Oil = Persistent, Unsolvable, Wrenching Stagflation
America is addicted to oil. We deem it a constitutional right to drive Hummers and have $4 a gallon gasoline. But there is an Achille’s heel to our lifestyle—oil is a finite resource, and one day we will run out of cheap oil.
Make Money as the World Goes Mad
Mike had already set his plan into motion, having bought an “escape house” in Whitefish, explaining, “You need to be near a rail-line, so they can ship in supplies. There’s a rail-line 1 mile from here. You also need a fresh water source. Whitefish Lake provides all the water I need.”
Analysis: Our economy needs more than an oil change to adapt to the future
Oil has become the bedrock of South Africa’s economy. Our economy is highly dependent on foreign oil imports. About 60% of our transport fuel comes from overseas imports of crude, most of it from the volatile Middle East.Recent and ongoing upheavals in North Africa have had a marked effect on oil prices. Oil is now trading at just above $120 (R848) a barrel. This is of concern because a 10% increase in the oil price can lead to a drop in GDP of as much as 0.5%.
Tom Simmons takes Aspen Laff Fest stage
Simmons suggests that telling sex and booze jokes is probably an easier way of doing stand-up. Turning peak oil and federal reserve policies into a comedy routine requires more thought and nuance than simply uttering words that are sure to get an audience's attention.“These kinds of subjects are hard to do,” he said. “It takes me months of annoying people, asking questions, to find the lines I want to say, and a way to condense the facts so I can get my side of the argument out.”
Ray Kurzweil: Solar Will Power the World in 16 Years
So how far away is solar from meeting 100% of the world's energy needs? Eight doublings, says Kurzweil, which will take just 16 years. And supply is not an issue either, he adds: "After we double eight more times and we’re meeting all of the world’s energy needs through solar, we’ll be using 1 part in 10,000 of the sunlight that falls on the earth. And we could put efficient solar farms on a few percent of the unused deserts of the world and meet all of our energy needs."
Wind power cheaper than nuclear, says EU climate chief
Generating energy from wind turbines at sea would be cheaper than building new atomic power plants, Europe's climate chief has said, in the latest challenge to the crisis-stricken nuclear industry.Connie Hedegaard, the EU climate change commissioner, said: "Some people tend to believe that nuclear is very, very cheap, but offshore wind is cheaper than nuclear. People should believe that this is very, very cheap."
Solar Rally Might Fizzle After Nuclear Accident ‘Hysteria,’ Investors Say
The rally in solar shares after Japan’s atomic accident may fizzle because the crisis won’t quickly boost demand for renewable power, investors including First Empire Asset Management’s Michael Obuchowski said.“The hysteria that helped run up solar stocks was not warranted by the damage in Japan,” Obuchowski, chief investment officer of the Hauppauge, New York-based firm that owns shares in First Solar Inc. (FSLR), said in an interview. “Down the road it may lead to policy changes and the restoration of incentives, but I don’t see that happening yet.”
UK reduces subsidies for large-scale solar
Greg Barker, the UK energy minister, has completed his review of subsidies for solar power under the feed-in-tariff scheme, and, as expected, he has reduced the amount of money available for installations that provide over 50kW.Ministers say the idea behind this review is to make sure that large-scale wind farms don’t hoover up money that was meant for households and small businesses to install a small amount of solar power (usually with solar panels on roofs).
Scotland Government Approves World’s Largest Tidal Park at Sound of Islay
ScottishPower Renewables, a unit of Iberdrola Renovables SA (IBR), says it will build the world’s largest tidal energy plant off Scotland’s west coast.
Fight Waged With Forks Is Rejoined in Congress
“If you look at the best companies to work for, nobody is questioning things like composting and recycling,” said Representative Earl Blumenauer, Democrat of Oregon, who wrote a letter this week to Speaker John A. Boehner to complain about the cut. Mr. Blumenauer’s letter — signed by some Democratic colleagues as well — also cited health concerns associated with plastic foam.Republicans counter that the composting program cost too much and had limited environmental benefits, and that the compostable utensils were a bad deal for diners anyway because they could not stand up to hot soup and the heartier salad fixings.
E.P.A. Proposes New Emission Standards for Power Plants
WASHINGTON — The Environmental Protection Agency on Wednesday proposed the first national standard for emissions of mercury and other pollutants from coal-burning power plants, a rule that could lead to the early closing of a number of older plants and one that is certain to be challenged by the some utilities and Republicans in Congress.
And So US Castles Made of Sand Fall in the Sea, Eventually
In a study recently published in Climatic Change, we delineated low-lying coastal areas of the conterminous USA that may confront impacts from rising sea levels. We found that an average of 9% of the land area in coastal cities and towns lies at or below 1 meter of elevation and is connected to the sea. For highly populated municipalities - those with more than 300,000 people - land area percentages at or below 1 meter are greater than the national average in New Orleans, Virginia Beach, VA, Miami, and Tampa, FL.
Contact
- Content: editors at theoildrum dot com
- Tech support: support at theoildrum dot com
License
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 United States License.
Engineering an Electrified Steel Interstate:
Oil-Free Transportation Options for the 21st Century
By Alan S. Drake (me)
Thursday, March 24 at 6:00 PM
1800 Engineering Hall
1415 Engineering Drive, Madison, WI
Campus of the University of Wisconsin
Construction of an Electrified Steel Interstate in the United States is an essential step towards building an affordable, reliable, sustainable transportation system in an oil-constrained future. The national security, economic, and engineering reasons to do so are compelling:
1) If/when the United States is confronted by oil shortages again, such a system would play a vital role in moving food and other essential goods and services.
2) Costs of constructing, maintaining, and repairing highways for interstate trucking are approximately four times greater than the same kinds of costs for railways.
3) Fuel taxes and fees from freight trucking cover less than one-half the costs of highway wear and tear caused by these vehicles.
4) Railways can accommodate much heavier loads and operate at higher speeds than highways.
5) Semi-trucks on highways use more than four times as much energy per ton-mile of cargo as diesel-powered freight trains; and with double-stacked containers on rail, the energy use differential increases to nine times as much energy per ton-mile of cargo using trucks.
6) Electrification of freight railway service can provide a 60-67% reduction in energy use from diesel power pulling the same load, and use domestic electricity instead of imported oil.
The vision Drake and his colleagues offer leverages the synergies between electrified rail service with creation of the Smart Grid, distributed generation, greater usage of renewable electricity, and proven energy storage strategies. A comprehensive, modernized freight rail system – in conjunction with electrification and followed by expansion of higher-speed passenger rail service where appropriate – would employ currently-available technologies and be justified by quick pay-backs on investment.
In order for the Electrified Steel Interstate to become a reality, the electric utility industry will need to work closely with government and the rail industry to achieve a progressive electrification of the railways, synergistic use of common rights of way, provision of advanced signaling and control mechanisms, and mobilization of currently stranded renewable wind power.
For more information contact:
Arnold Harris (608) 798-4833 arnoldharris@tds.net
David Knuti (608) 234-7430 knutifam@yahoo.com
Sounds great, Alan and I would wish to be able to attend. I think you guys are on the right track (pun intended)...
E. Swanson
Be aware that transportation policy in Wisconsin is driven by the highway lobby and a nutcase governor.
Governor Walker Rejection of High Speed Rail Costs Taxpayers $60 Million
It's amazing how many politicians are in a state of denial about where oil production and oil prices are going.
US oil production peaked 40 years ago and is now down to about half of what it was back then. The cruel fact is that the US has produced most of its oil and is now scraping the dregs from the bottom of the barrel. Oil prices have been unstable, but usually rising, and West Texas Intermediate is now consistently trading over $100/barrel (cheap compared to most global oil prices). Developing country demand (particularly from China) is steadily increasing, and global production (notably from Saudi Arabia) is not keeping up.
I guess they just assume that if they close their eyes and ignore it, it will go away and not bother them, much like the bogeyman that used to hide under their bed when they were kids. Unlike the bogeyman, the peak and decline in world oil production is real, and is likely to bite them hard if they ignore it.
You have to understand how America works. I'm sure you do, but it's worth pointing out time and again, because it helps clear confusion about so many things which otherwise may not make sense.
America long ago abandoned any notion of the public good. All that matters is for a small group of people to make more money than they know what to do with. That's it. Everything about this country, and every policy, now revolves around that.
And why do people support this? Because they themselves believe that they will one day make that much money!
So you can see how something like high speed rail is a no go, from the beginning. It's a public good, and in this country those things don't matter.
What matters is this: that there be some individuals, no matter how small in number, that can still afford cars and airplane tickets. Doesn't matter if the costs of these things go up, or even skyrocket, as long as the rich can afford it.
Our roads will crumble: but as long as the rich can afford sturdy cars to traverse them, everything is fine.
Airlines will go bankrupt, airports will disappear: but as long as there are still some functioning (and particularly the major ones), and the rich can afford it, everything is fine.
So America will hang on to whatever's left of it's highways and it's airports, and won't build anything else, because, well, the rich can always afford to use them even if the rest of us are stuck in place.
And the poor souls with no means of transport will dream of striking it rich, so that they too can someday buy a car and drive 70 mph on an interstate, or fly to somewhere like Las Vegas or Disneyworld, which will now be exotic destinations. It won't occur to either them, or the politicians, to build high speed rail so that ordinary people can travel.
Mind you all of this is just an observation. I'm very ambivalent on which is the proper course of action in a dying society. Even if there was high speed rail, I don't know if I would want to ride it.
Ever since the Great Depression of the 1930's, America has found one consistent answer to economic malaise: war.
War feeds the war machine. The war machine then produces "jobs". Jobs for engineers to design ever more efficient death machines. Jobs for logistic support companies to manufacture massive quantities of uniforms, helmets, guns, other infantry paraphernalia, munitions, planes, ships, missiles, satellites, computers, etc., etc.
Every time a major conflict has ended, America began to tailspin back into another recession or depression.
So Presidents are constantly on the look out for another good (or flimsy) reason to go to war.
GW Bush had it easy: 9/11. (The debate as to whether 9/11 was a self-manufactured excuse like Gulf of Tonkin or a real McCoy will go on forever. But it doesn't matter because Obama does not have his own 9/11. So he'll grasp at any brass ring that comes his way, be it Afghanistan or Libya.)
The business of America is business. And the business of business is war.
Timeline:
http://americanhistory.about.com/library/timelines/bltimelineuswars.htm
As a Californian, I'd like to thank Governors Walker of Wisconsin and Scott of Florida for freeing-up more rail funding that can be delivered to California.
I'll second that.
Well, at least the body of the article is honest in omitting the fraudulent term "high-speed rail" that blares from the title. The text itself leaves it clear that nothing was ever on the table but typical Amtrak trundling along upgraded freight tracks at history-museum speed, when and only when someone happens to feel like it. Great way for a freight operator to chuck costs off onto the taxpayer, though.
The laughable notion that it was going to run on $600,000 per year in pocket lint is just another fatuous, low-balled advocacy-group fairy tale. There's hardly a government operation that can even blow its nose for $600,000. Let's not forget that typical Amtrak tickets cost considerably more per mile than typical air tickets, and even at that cover just a fraction of just "operating" costs (never mind capital.) The Tooth Fairy, of course, has yet to deliver on the rest of the costs.
Then we need to reckon with yet another complication not even contemplated when the project was turned down, namely the new Congress. They may be less inclined than previous ones to provide limitless largess for such things. There was never any guarantee about ongoing subsidies, nor about the inevitable huge "cost overruns". Maybe, and contrary to the spirit of the article, we can't automatically count on passenger trains forever being free Federal gravy.
So the question is, even if gasoline/diesel became expensive or there were supply problems, would enough people have used the thing to make it worth the upkeep? (Freight shippers don't seem to give the proverbial rat's behind about trains going even as slowly as 10 or 15 mph, so expect no help from them.) Or, who has four or five hours to make what is now a 60 to 90 minute trip, from their actual destination in the Madison area to their actual destination in the Milwaukee area or vice versa?
Sure, it might have benefited a few well-paid types commuting between precisely the right downtown spots, but beyond that, who? Generally, in order to use a downtown station, you'll either drive a considerable distance and then pay a huge parking "fee", or else pay an astronomical cab fare, or else spend forever and a day, especially at the Madison-area end, walking a long way to a city bus stop if you even have one (and at many spots never on Sunday), waiting for a city bus which is a worse crapshoot even than Amtrak, maybe waiting a random time again for a transfer, and finally waiting for the train. And when, after an eternity, the train finally delivers you at the opposite end, your car isn't with you, so rinse and repeat in reverse with more hours of waiting and creeping, or another astronomical cab fare (or an astronomical car rental.) On top of all that, what used to be a day-trip is now stretched into an overnighter, very possibly piling an astronomical hotel bill onto all the rest.
Thus, the two practical alternatives will often be (1) driving, and, failing that, (2) forgoing the trip altogether. (Those who won life's lottery as $1000/hour lawyers can always take (1).) In a bad economic scenario, such as a deep recession from, say, a sudden major physical reduction in oil supply exacerbated by the inevitable clumsy ham-handed rationing and price controls, this will not improve. Many will be unable to afford the train ticket despite the massive subsidy, to say nothing of the hotel bill.
So, like it or not, it's not 1920 any more. We're talking a city of a million and a city of a quarter-million with no megacity very close-by, that are themselves fairly far apart (by the standards of jam-packed places supporting good train service such as Holland, metropolitan France, or the east-central coast of Honshu.) Under BAU, they support about six or eight busloads (not always full) a day going each way between them.
Given more prosperity than BAU, one would imagine that more might drive. Given less prosperity, there would be less time and money for travel. Maybe there an extra busload or three would be diverted from driving, or maybe not - bus service has been fairly stable for decades under a variety of conditions including even the oil embargoes. So, really, what are the odds? In what scenario are enough riders (not just an extra daily busload or three) surfeited with spare time for endless waits and delays, and surfeited with spare money, to support anything resembling what is conjured up by images of fancy railcars from European and Asian megaplexes, as featured in articles, brochures, and "working papers" fraudulently hyping "high-speed rail"?
Welcome to the 21st century. The next train arrives at - well, never in your case. Feel free to walk to the next station because there may not be enough fuel to drive there.
This misses the point. In the doomy scenarios, it's not a snarky joke; it's the unavoidable essence of the problem. During discussions like these, I keep remembering - and being appalled - that as late as the 1970s, a good many students at the huge University of Wisconsin in Madison had never been more than about 25 miles from home until they came to Madison, except maybe for being born in or otherwise needing a hospital. And that was on the fast-rising portion of the oil curve, and in a scenario much more prosperous than what seems to be contemplated here. (Part of the story is that a dairy farm is something of a ball-and-chain, but that's not the whole story.)
In other words, unless you can afford both a lot of time and a lot of money, then for you the train indeed arrives at - "well never". You can walk or bike or stay home (for example, I gather from literature of the period that around the turn of the 20th century, some folks in English towns were accustomed to fairly long rides on the rather awful bikes of the day.) As far as you're concerned, the train is mainly a toy for the very affluent that you might with luck use, if at all, a few times in a lifetime.
So the hoi polloi mainly stayed home. Some were confined for life. If we can't (or won't) avoid one or another of the doomy scenarios, then Jim Kunstler will become right that life will be a lot about staying home.
The thing about Britain is that you can hop on the train in London after work on Friday, go to Paris for the weekend, spend all day Saturday and Sunday touring the city, drinking wine and eating fine food, and be back in London on Sunday evening.
When I was working in England, a buddy of mine did that with his girlfriend because, what the heck, with the Chunnel and high-speed trains, Paris is practically next door. While you're in London you may as well take the opportunity to visit Paris.
Some of the Brits were horrified when we mentioned it, but some of them hadn't even been to the next village to theirs, never mind Paris. There seemed to be some kind of fog bank over the English Channel that prevented them from even thinking about it.
Eurostar: London to Paris from $64 in 2:20h
High speed trains - coming nowhere near you in the US anytime soon. Service available in major European and Asian cities on a regular and very fast basis.
Gee, Paul, I guess the airline industry gets no subsidies. That would be a huge surprise.
The problem is trying to dig out from under all the graft, corruption and lies to discover what is the better way to travel city center to city center.
Typically, most travelers are businessmen who want to do just that - travel to the city center. And, they are leaving from some other city center. The airport is always way out in no man's land somewhere where flight paths won't intersect buildings, and of course there is a whole lot of flat, empty land. Oh, never mind that airports take huge acreage out of production, and that rail lines are already there - along with stations and all. Not that we could use the existing track, but we could certainly do elevated rail, preferably monorail, that can really cut the mustard at in excess of 280 mph. City center to city center, HSR would save much time, and parking is no more an issue downtown where no one drives automobiles any more than is airport parking.
As time goes on, we will see more and more of the population moving in toward the center of the city, driven by the impossibility of trying to get around in the suburbs while paying $25 a gallon for gasoline. Jobs, such as they are, will move to where the workers live, thus becoming far more centralized. Hopefully employers will be providing shuttle service for their employees. In fact, my guess is that this would be the norm. The alternative of public transit seems to be doomed from the onset. Sadly, HSR will not likely happen, not for lack of need or utility, but rather for lack of political will.
The future unemployed will be found near city centers as well, living in cardboard boxes and shanties. Check out the slums near the big cities in Asia and South America! There is your future!
I don't expect this to happen tomorrow. It will probably be a slower process than that, much as Greer describes in his books. And, gradually, inexorably, the populace will succumb and this will become a third world world! Today's oil exporting nations will be the last to hit bottom, since they will have energy available longer than the rest. And, like I said, it will all be slow and certain... we have probably waited too long to stop it now. There is not enough time and energy left to do what needs to be done, and HSR needed to be complete today, not some day in the great bye and bye!
Enjoy your future of air travel, ICE vehicles and other assorted myths and legends.
Craig
The thing is that even for many businesses, this city-center to city-center stuff is sooo very twentieth century. In the Washington DC region, they famously call them Beltway Bandits for a reason. Those rich enough to live (outside of cardboard boxes) or set up shop in the obscenely expensive centers of megacities big enough to actually support good train service will do whatever they want, until beyond any time-frame for which our crystal balls can tell us anything worth our attention. Check those same big Asian and South American cities for details. (And let's not forget that many of the favelas are not in or particularly near the downtown, but are somewhat isolated - and that many, many folks are even more isolated in slummy parts of smaller cities and towns.)
In a severely impoverished 'developed' world, should it come to pass, there will indeed not be a question of "myths and legends", ICE or otherwise, but more a question of people being forced by circumstances to stay home, as was the case so recently with the students I mentioned nearby.
Part of the point was that despite all the fraudulent misrepresentations, there was hardly any HSR on the table at all. The tiny bit that was, was just another subsidy for the highly affluent East and West Coasts.
So true. It is a joke, except that it is not really funny.
The times give rise to despair. And then you see how the Japanese are reacting and helping each other, being civil, and caring. How did we ever get so off base?
Craig
You know Paul, I used to travel by train in the midwest in the late sixties, no less, not the 1920s. We'd jump on Chicago's heavy electric rail (the L-any time the L would get us there it was worth walking the extra half mile to the station rather than take a bus, I lived in a near west suburb) transfer around a bit, walk a block or few and jump on the Illinois Central down to Champaign-Urbana. Then we'd walk a mile or few home or share cabs if we were feeling affluent. Nobody took the bus because we had a train.
That was how students did it back then. We were known for living on the cheap--sort of what people here describe as BAU lite.
It cost's me $3,000-$4,000 on average per yer just to keep a reliable, licensed and insured car in the driveway whether or not I ever turn the key to start it. so...
In what scenario are enough riders (not just an extra daily busload or three) surfeited with spare time for endless waits and delays
How about one where we are about as well off as we were in 1955-1965 but a decent, bicycle friendly light rail system has been built out into the suburbs because it is cheaper to abandon our cars than our homes. We will still travel some and heavy rail would make that occasional trip to grandma's or brother Joe's possible. There are certainly enough of us to fill trains with just occasional trips if that is what we all use. Rail would electrify a bit easier than Greyhound when talking highway distances. Trains can hold schedules at least as well as rush hour traffic with summer construction delays.
Yes I left out the fancy rail car and high speed part--that certainly isn't a big part of BAU lite--both might eventually appear if we successfully transition to BAU lite though.
Sounds great...,
Republicans will hate it....
Actually, in another state a retired politician (former minority leader in the lower house of state legislature) is a big supporter and putting work in. He is a traditional Republican.
Several face to face meetings with US Representatives, etc.
Alan
Unrest in the ME escalates further; at least 30 killed and 100 wounded in Sanaa, Yemen.
LIBYA HALTS ALL MILITARY OPERATIONS
Oil Drops.
Libya says they are halting all military operations.
This statement was entirely predicted in the UK media yesterday.
I fully expect protesters will still be rounded up at gunpoint and disappeared.
The UN resolution was 'all necessary actions' to protect the civilian population of Libya.
What will the UK/France do?
If I was leader I would spend another 48 hours preparing, then use reports of continued attacks on civilians as cover to send in the planes.
Don't give the Arab league long enough to get cold feet.
I think they waited too long.
And even if they hadn't, it might not have been enough. The rebels are simply not prepared enough to win. And the army seems to be supporting Gaddafi, unlike in Egypt.
I think they did over-delay things, which doesn't help matters. But the momentum could change again. It's a massive morale boost for the rebels to know the international community is on their side. Egypt is passing weapons to the rebels in the East, so they also have support from those quarters.
A lot depends on momentum I think. It's as much whether Gadaffi can withstand the pinch on all sides too:
The majority of Gaddafi's remaining forces are not Libyan. He never trusted the regular army and he steadily down'graded them during his rule. Many of them joined the rebels. Most of his remaining troops are extra-nationals (mercenaries, they are called in the UK, but many are permanently settled in Libya). The hope is, that when confronted with superior airpower, the mercenaries will see the writing on the wall and leave.
At this point, Gaddafi doesn't need air power.
Gaddafi is an expert at keeping the provocation just below the level that would trigger a UN response. As you note, his response was entirely predictable. He's not the kind to bluster to the end, like Saddam. Instead, he gives in. Or appears to. And continues doing what he wants by other means.
Which is why I predict UK/French aircraft will start attacking his ground forces within 48 hours.
Our governments have decided Gadaffi is no longer acceptable as a ruler. Our governments will take the political flak to force his removal. The UN resolution and Arab backing was the best political cover they could hope for, better in some ways.
From now on we are at war with Gaddafi. The decision has been taken.
http://www.guardian.co.uk/world/blog/2011/mar/18/libya-military-action-l...
I don't know why the market is having such a hard time handicapping the Libya outcome. I mean, most of the exported 1.3 mbpd (I think) is off-line. It will most likely be off-line for months, regardless who ends up being the dictator. Most of the expatriates who were making the oil infrastructure work, before, are going to be scared to come running back to their old job. The oil will eventually come back on-line, in a slow and diminished fashion. Let's say half of previous output in a year. Can't everybody come to a consensus on world oil price based on that? Or is all of this just an excuse for your real fears about supply and demand?
While I agree with you that they were too slow, here's how I think it will play out:
First, obviously, Gaddafi will have to continue the rout of the rebels via ground forces. He's not about to allow them to regroup. It will be call a police action, rounding up criminals, etc. but it will continue.
Second the west kind of has to act now, and its first step HAS to be to take out all air defences. Therefore fixed locations and runways will be bombed, as will C2 nexus points.
Third, Gaddafi will have to strike back - just to maintain face. He could do that militarily, by launching some Scuds or anti ship missiles; or he could make it economic - say agreeing a long term export contact to China. It would be kind of difficult for NATO to interdict a Chinese crude carrier from Libyan ports...
Fourth, NATO will need to bomb some troops if they are to make any difference to the rout of the rebels. I'd expect Gaddafi to have some nasty surprise waiting in the shape of capable MANPADS taking out aircraft.
Last, Gaddafi will be able to beat out the rebels, and then what? There's no mandate for much else by the west. Stalemate.
Therefore to change the ending, NATO will need to change the game. That means a decapitation strike in practical terms. At some point they have to try to take him out - 'by accident' maybe? My guess is they will overload the initial air defence removal stage with some hits on buildings they think are useful hiding places. That will be coupled with special forces tracking and some of the quick response lessons they have learnt in Iraq. Gaddafi likes to grandstand, usually in tents. I wouldn't be at all surprised if drones were quickly stationed, 24/7, over likely locations, carrying the proverbial 'missile with your name on it'.
Fascinating development.
More details on AJE: http://english.aljazeera.net/news/africa/2011/03/2011318124421218583.html
Update: Analysts fear shortage of key resin
Fast collapse of industrial society (in the historical perspective ) because of the loss of key electronics components has been one of the more likely scenarios I have been considering. A major earthquake in Japan was an obvious weak point in our increasingly brittle, just in time, interconnected world. Common point of failure.
If the Japanese economy goes into melt-down, if the widespread hunger and food shortages break the legendary Japanese stoic resolve, we could see social breakdown and cascading failures leading to the loss of all production capacity.
A bit like a 7 reactor nuclear plant where all cooling backups get taken out in a single common point of failure. Once the radiation level reaches dangerous levels, regaining control is almost impossible.
I'm not saying this is it, but it is one to watch. After all, Japan managed to shut down a dozen other nuclear plants without major incident.
Cue the Fragility of Microprocessors article:
http://www.energybulletin.net/node/19131
Peter.
But isn't this also just a microcosm of the fragility of globalization?
When manufacturing absolutely depends on just-in-time delivery of a wide range of parts and materials from long-distance supply lines all over the world, a glitch at one point can upset the whole apple cart, so to speak. I know, the idea is that there will always be someone else in the world who can step in with a replacement part or an alternative material, but often that takes a lot of time, if it works at all.
The Prius shortage mentioned in one of the articles above is another example of this phenomena, and I imagine we will see many more going forward.
Ironic that one place that seemed to have dependable political stability, at least, was undone by tectonic instability.
" the idea is that there will always be someone else in the world who can step in with a replacement "
No limits, and if any limits do appear ("no one saw that coming"), there is always Infinite Substitutions for anything and everything (..."Including the consumers." said The Mother).
Death by a thousand cuts, some larger than others. A million BOD here, a few gigawatts there, budget cuts somewhere else, it's beginning to add up. As I mentioned yesterday, Japan took a huge hit to its #1 protein source, fishing, and a big chunk of its arable land as well. Only their sense of collective purpose will allow them to make up for these losses. While I expect them to give restoration of their tradable goods production priority, much of their energy will necessarily be turned inward. ELM. (It'll be interesting to see what happens to their consumption of whale meat and giant bluefin.) I'm not sure how they will service their debt, but then, I'm not sure how the western world will service theirs either. The slope just got a little more slippery. So it goes...
Go local. Get used to it.
I sent the following link to my Update list yesterday:
http://www.financialsense.com/contributors/chris-martenson/alert-nuclear...
Martenson is not some nut case spouting off doom. If he is concerned, everyone should be concerned.
Todd
Some of the people on your list would really like to see the sun again.
There are going to be supply bottlenecks in the tech arena, but with Fabr and Sourcing spread as far as it is, how much is such a closure more a speed-bump than hitting a brick wall? I'm not a 'market will solve it ALL' kind of guy, but there certainly is an ability for businesses to recognize a gap in the streams and fill it.. like creating duplication where sourcing bottlenecks had been too heavily relied on, as in this case.
(and that is said with the second intention of pointing out that we probably need a LOT of practice with speed bumps at this point, if we are going to run our society at something other than Full Throttle from here on in)
This may actually be more serious than it sounds. One of the key reasons for switching to this resin is that it can be made with extremely low radioactivity. Utterly essential for fine geometry chips in general and dram and flash in particular. With plants in Fukushima prefecture and Ibaraki prefecture next door, I wonder if this will be possible.
Paul
FOR ALL - A small but frustrating comment from a "supporter" of PO recognition up above: "oil is a finite resource, and one day we will run out of cheap oil." I suppose it's a matter of perspective. IMHO "cheap oil" is $25/bbl or less. Oil above $50/bbl is getting pricey. And oil at $100/bbl? A somewhat picky point but still is this the message we should be putting out to the public: our cheap oil today will run out in the future. Maybe just a slip of the tongue but the cornucopians are always on the look out for a wedge to drive into the debate.
Yeah, Rock.... and the rest of the article was pretty empty, unless you're interested in Birol's retirement plans.
Jobs paying $8.50 per hour, commuting 15 miles, driving on old pick-up truck (getting 14 miles per gallon) = oil price is too high now.
same job, but change car to Ford Escort (getting 30 miles per gallon) = oil price O.K. for now (but hey, the food...)
Double the price again and this job cannot be afforded.
People are slowly working through the easy changes. Each successive step-down will be harder to accommodate.
eastie - I was thinking more in terms of that person losing their $8.50/hr job due the economic hit of $100/bbl for oil more than the commuting costs. After the run up in oil the last year it's difficult for me to not anticipate unemployment bumping up significantly in the next 6+ months. That's going to be a very difficult step down for some folks to accomodate.
The problem with so many of the general assumptions regarding individual changes to living is the expectation that we (the generality of us) keep our jobs. Also, for example, that we can afford that new more economical car. Very few jobs are in fact safe if the paymasters, whoever they might be, no longer have the wherewithal to employ staff. Suddenly becoming self employed is not always possible, and if it can be managed does not liberate the worker form the usual economic restraints, and makes borrowing money in the short term when the security of income is in doubt well nigh impossible.
There needs to be a government which puts the nation on a war footing and forces the move to rail, towards economical cars, towards properly insulated housing, towards sustainable agriculture and towards conservation in all its forms. It could be really exciting if people competed to live with less waste, rather than more; but it won't happen.
Unfortunately, as long as growth is the only mantra the governing classes can understand there is no hope.
Rocky: More likely he would be looking at a new job at $7.25, and more like 25 miles away. Of course, there will be no public transit (at least if he lives in most Dallas, TX suburbs), or limited at best. Oh, no benefits either. No vacation, no insurance. Enjoy!
After the cuts to education, everywhere, we can look for serious increase in real unemployment, and more government lying about the numbers and percentages. GDP destination, new inflation rates and impact on the economy? Who knows, but we can be certain that the government will have some spin to save the banksters and Wall Street execs, which is where we find the true entitlement mentality.
Have a nice country.
Craig
Telecommute to work 4 days out of 5 and fuel can go to US$5/gallon for all I care.
But oh yeah, everything else transported and manufactured using FF goes gets expensive too.
Oh well! Now I'll go back to reading TOD.
You are right Rockman, the author of the article up top: Peak Oil = Persistent, Unsolvable, Wrenching Stagflation seems to think that $100 oil is cheap oil.
We ran out of cheap oil a long time ago. And when we run out of $100+ oil we will not have stagflation we will have an ever deepening recession. And soon that will be followed by a deep depression. And that will be followed by...
Ron P.
Last week I had (again) some debate with Nick. Many don't take him seriously, but sometimes he has 'real world' solutions. Cargo ships can reduce fuel consumption by 40% when speed is reduced by 20%, is one of them. He thinks that there can be sustainable economic growth during declining oilproduction (I don't, I think at best a few years) OTOH he admits that Peakoil is a big problem. However, there might be more elasticity in the system than one could think of.
Cargo ships can reduce fuel consumption by 40% when speed is reduced by 20%, is one of them.
Yes, and cargo containers moved by trucks can be switched to double-stacked container trains, with about a 90% reduction in diesel fuel consumption. For that matter the rail lines can be converted to electricity and the oil consumption reduced to zero.
The thing is that these solutions actually have to be implemented, rather than lost in some speculative haze about how you can have solar-powered semitrailer trucks. The alternative is to see the economic activity shift to some other country which has anticipated the costs and is building the infrastructure to handle it. Need I mention China by name?
The Chinese are electrifying their lines and running double-stacked container trains under power wires. India Rail can run double-stacked or even triple-stacked containers on flatbed cars under wire due to the extremely broad gauge the Brits built the Indian railways with. Finally, a really solid advantage of British colonial thinking.
Yeah, but slowing down to use less fuel doesn't need to be implemented, it just needs to be done.
And India is building 2,762 km of new, freight only, double stack# electrified rail lines.
A north pointing V over the northern half of India.
http://dfccil.org/wps/portal/DFCCPortal
In the US, double stack containers are in a "well" car with the container about a foot above the rails.
In India, they double & triple stack them on flat cars (easier to unload, more cars/km of train, cheaper) but only run triple stack with diesels.
Trolley wire is 7.45 m above the rails.
Best Hopes for India (and the USA),
Alan
Electrified is great if you have reliable electricity. Are the Indians on top of their power situation better than, say, the Pakistanis?
One does NOT need reliable electricity for everyone, just for priority users like the railroads.
In India, where the grid is fairly reliable but not quite EU or USA levels, they cut residential areas, usually in the suburbs. Which is what the USA should do if/when we run short, just rotate blackouts through the suburbs. I have read of no comments (India Railways has quite a blog following, mostly in English) or reports of problems except one commuter line where a lorry knocked down a pole during rush hour.
India has been running electrified railroads for decades. Some before independence but growing in the last few decades. 28% of track miles five or so years ago, most recently 31%. And that is before the new freight rail lines.
Best Hopes for Indian Railways,
Alan
They want to keep a rising population at work, you know. And trucks you need anyway, for the transportation from the railway stations to the stores in the cities and every corner of the countries.
Nevertheless ChinIndia oilconsumption will keep on rising until their economic bubbles burst. Then they won't need double or triple-stacked containers anymore I guess.
Even with a burst bubble, China & India will still need the most efficient transport system possible, preferably one that avoids using oil.
Neither will return immediately to 1960 levels of economic activity, and even if they did, efficient oil free transportation still helps the overall economy.
Alan
You can't have sustainable growth; it's an oxymoron. You can have growth -> collapse --> growth --> collapse... and maybe sustainable development.
Boiling frogs do keep chatting in their sauna, but they say some funny stuff, even the smarter frogs..
The Natural Resource CTTE hearings on Gas and Oil Pricing yesterday was a fine example. Boy, are they excited about American Energy.. unless the Sun is in any way involved. There were some very pointed questions put to the panelists to remind us all of just who OWNS the hydrocarbons out there.
Silly Frogs.
Interesting how over time the goal posts can mysteriously move. The perspective is always altering. In this case I'd say the cheap stuff is gone and most likely its a permanent situation, only to get much more expensive in the future.
There was a bit on CNBC this AM in which their polls showed consumer discontent and reductions in discretionary spending in response to higher fuel and food prices and Kudlow was trying to do his best to claim this was mostly psychological. Sure, if you work as a commentator for CNBC the price of fuel and food make little difference. What the wealthy cannot wrap their heads around is most people are simply making their monthly bills, with little to spare. As I've said before, we cannot judge the price of energy and food by what the well off can afford, but the meaty curve of average Americans holding on by a thread.
Why inflation hurts more than it did 30 years ago
http://news.yahoo.com/s/ap/20110318/ap_on_bi_ge/us_inflation_economy;_yl...
Seems we are getting boxed in. With an ave weekly wage of ~$351, there's little room. It does seems that oil is stabilizing around 100 WTI, 115 Brent. Likewise for food-$8 wheat, $6.50 corn. And the old corn-wheat spread appears gone for good. Used to be about 2/3 corn to wheat, now the futures prices are frequently close to equal, with corn today at 6.85, Kansas wheat 7.30.
The effect I see is that corn is well on a march to an industrial product. An input source and not a food per se. It still may a component among large feed manufacturers, but increasingly other sources are substituted. Like the annexation of farms close to town, the land is just too high priced for farming. The common substitution I see here, by hog growers who mix their own feed, is barley for corn. Corn doesn't figure anymore.
So...you're feeding my beer to your pigs? :)
I was planning on drinking a bunch, on the down side of the Hubert Curve.
It's going to be an expensive "industrial product".
Corn hits 'limit' up, again
Yes, compared to historical prices.
2010 US production 12.4 bil bu., 4.9 bil bu to etoh, from memory. How high can oil go?
I used to trade hunting permission on our place each fall to a guy for a couple tons of corn-no more. Now it's wheat. He gets a better deal for dirty corn than dirty wheat.
Russia follows Canada and cuts grain harvest hopes
and
Wheat prices climb after Russia cuts crop forecast
Russia follows Canada and cuts grain harvest hopes
And let's consider the effect of US fuel ethanol policies on world grain prices:
Ethanol and global food prices explored at GrainWorld 2011
It's not a good time to be a grain importing country, as evidenced by the riots and government overthrows in North Africa and the Middle East.
"oil is a finite resource, and one day we will run out of cheap oil." I suppose it's a matter of perspective. IMHO "cheap oil" is $25/bbl or less. Oil above $50/bbl is getting pricey. And oil at $100/bbl?
Yes, the fact is that we have already run out of cheap oil, or more accurately, cheap NEW oil. Oil at $25/bbl or less is the stuff we found 50 years ago, and there is still some of that left, although not in the control of Western oil companies.
Most of the old, cheap oil is under the control of the National Oil Companies like Saudi Aramco and Iranian National Oil Company. The Western oil companies found it for them generations ago, and since then they've firmly applied their desert sandals to the butts of Western oil men, and are now producing it for their own advantage.
Oil above $50/bbl is what we are finding now, so that is the minimum price you are going to pay if you are restrained in your demands. Oil at $100/bbl is what you get if you want more oil than the oil producing countries can deliver, and it appears that consumers want more oil than the producers can deliver.
The maximum price is whatever you can afford. Whatever price you can't afford, that's the price oil will go up to. When you send your car to the junkyard and take a bicycle to work, then prices will stop going up.
Alternatively, it's the price at which you lose your job, the bank seizes your car, the mortgage company forecloses on your house, and you drop out of the economy completely. Your choice.
The maximum price is whatever you can afford. Whatever price you can't afford, that's the price oil will go up to.
It would seem, that for some people the price is already there - this sign from Hazelton, in northern BC, last week;
For the record, the actual price is $Cdn 1.29/L, or about $US 4.95/gallon (for regular unleaded). I think the sign would sum up the reactions of most US drivers to that price.
Well, it's only a matter of time until US drivers will have to pay $4.95/gallon, too. And not long until they think that is a really cheap price.
At which time the cornucopians will announce that this is cheap gas, and it will be another 10 or so years before it gets really expensive.
Craig
It's only a buck more than we pay now--which we can actually handle with just a few adjustments--like taking a boarder in that spare room (well it wasn't spare but the kids can share) or doubling up the with your brother-in-law and moving into the basement half of the formerly single family now duplex home. <?-) Oh that would be after we look back and see $4.95 as cheap.
How we'll adapt really depends more on how much of the population can keep more or less making wages. Transport and housing will work themselves out in relatively short order in the US as long as enough people can be kept working and at least almost making a living with the effort. That is a really big as long as
That is a really big as long as
Yes it is. The problem is, that whether gasoline is $3,4 or $10, it doesn't change the fact that those jobs are still disappearing, and many of the remaining ones are government jobs that are over paid/benefitted, and there is less tax revenue to fund them. So even the government jobs will start shrinking soon.
The funny thing is that American companies are doing well (GE, Apple, etc), (and, by extension, so are some American investors) it's just that they are doing so by having lots of overseas operations.
I think, for the US in particular, this will be a jobless recovery. GDP may grow, the Dow has recovered, even average income might improve, but the most important economic statistic - do you have a job, or not, is unlikely to show similar improvement.
High gasoline prices just make that more painful still, but if you don;t have a job in the first place, the cost of gas is not your top concern or shouldn't be.
"I think, for the US in particular, this will be a jobless recovery."
Jobless recovery.....kinda like cutting off a leg to recover from cancer, more of a retrenchment really, and excluding the top 10%, I doubt average income will improve. It was declining in real terms for lower income brackets prior to 2008. I don't see it rising much going forward. The velocity of money will continue to be up the income pyramid. Those at the top have lost interest in improving the lot of those at the bottom. But relax, Paul, it's only temporary; always is. At some point, that leg may come back to kick some butt.
2011 Tech Tune Up
Power Basics for Harnessing Energy from Renewables (Wind and PV)
Prof. Ned Mohan
This 1/2-day tutorial will present the basic concepts in understanding how electricity is generated by wind turbines and photovoltaic arrays, and supplied to the utility grid.
Smart Grid: Enable a stronger, smarter, and more secure electric power and energy infrastructure
Prof. Massoud Amin
Recent technological developments and policies combined with potential for technological innovations and business opportunities, have attracted a high level of interest in smart power grids and energy infrastructure.
I learned my 3-phase power basics from Mohan many moons ago and my work colleague knows Amin well and thinks he has some great ideas. Thanks.
Ambrose Evans Pritchard, a senior columnist at the Uk's Daily Telegraph writes
http://www.telegraph.co.uk/finance/globalbusiness/8386829/World-energy-c...
From Ritholtz at The big Picture.com:
I Hate Corn Ethanol.com
Well...the people who trip across this site, might not be peak aware yet, and you don't want to scare them away. Baby steps. Let them talk themselves into believing in things like energy invested for energy returned.
Yesterday, I was doing a crossword puzzle (in The Onion) and one of the clues was: Peak oil meas. Three letters, and the answer was bbl. I would have preferred four letters to answer mbpd, but I just thought it was interesting that they chose "Peak oil meas." instead of "oil meas."
Above: PetroChina Plans to Add Oil, Gas Assets as Japan Earthquake Boosts Demand
The Chinese are opportunists if nothing else. This just seems a bit gauche while these disasters are ongoing; my Western perspective perhaps. One man's tragedy leads to another man's triumph...
Ghung - Indonisia is also in an advantageous position. Not sure how much surplus LNG they have but they're signing new contracts with Japan right now. The Indonisians need some help since they became a net fuel importer a while back.
Careful there ROCK. I think you should have said 'liquid fuel' to avoid confusion. Indonesia now imports oil but still exports natural gas and lots of coal. As for natural gas (exported as LNG), here's the situation from the Gas Trends databrowser:
I'm sure you'll be shocked to find out that, although production is up, net exports are flat to down.
In this databrowser you have both the EIA data and BP data. Both data compilations tell essentially the same story with regard to net exports. So what will happen going forward? Well, I won't place any bets on whether production levels will increase quickly, slowly or not at all. But I would be willing to put some money on population -- it sure as heck ain't going down any time soon:
Pretty soon, contract negotiations will be about breaking existing ones rather than signing new ones as Indonesia's net exports of natural gas will almost certainly decline over the next ten years.
Jon
Jon, can you publish the 'gas graph' for Iran ? Interesting, regarding their plan to export more AND let all their cars run on gas in 2015 ?
Production / Consumption / Net Exports:
divided by Population:
equals Production / Consumption / Net Exports Per Capita:
Iran has a growing population and is using more per capita every year. The thing to remember, though, is that Iran's production has been hugely throttled back by international sanctions. They could produce a lot more gas but may need to use much of it themselves to satisfy internal demand.
I expect the Iran-Pakistan pipeline to go through, however, as I described in detail in a post on Pakistani Pipelines.
Jon
Now they produce almost twice the amount of Indonesia. If for example
Iran can produce 20-25 billion cf/d for a few more decades, then they are in a good position. Enough gas for rising internal demand and export. But there are only a few big gas exporters in the world...
Jon - I used that term specifically to draw out some facts from a smarty pants like you. LOL. Mucho thanks.
PetroChina Plans to Add Oil, Gas Assets as Japan Earthquake Boosts Demand
PetroChina has bought over $9 billion in Canadian oil sands and shale gas assets in the last year, so they are definitely interested in buying up all the oil and gas they can get.
After the way Japanese LNG terminals stood up to the recent earthquake, they may be showing more interest in LNG. PetroChina's latest deal (last month) was to buy a 50% interest in Encana's BC shale gas properties, and today Encana bought 30% of a proposed LNG terminal at the Port of Kitimat on the northern BC coast. I think there is a certain momentum developing behind the concept of Canadian LNG exports to China and elsewhere in Asia.
Yair...we have this kicking off here too:-
http://www.dip.qld.gov.au/resources/project/gladstone-liquefied-natural-...
They are planning to drill forty/fifty thousand wells...many of them on good farm land. In this country land owners have no mineral rights and folks are worried about the effects of drilling, fraccing and what all.
There have been some major protests and, knowing the people, there could be civil disobedience and lots of strife over this one
Well, the Kitimat LNG Terminal is going to be built on an Indian Reservation, and the natives are fully onside with respect to the project:
Haisla Sell Off Stake in Kitimat LNG Project
There's nothing like an $8000 cheque in your pocket to make you feel good about a project. Aboriginal Australians probably don't get many bonuses like this.
From Nature Bats Last:
Population decline in rich nations: Will it be good for our planet?
(I think there is a double entendre in that last sentence... maybe? I have not read the entire article yet...)
Ray Kurzweil: Solar Will Power the World in 16 Years
Yeah, sure Ray. And we'll be battle against terminator robots a couple years after that. It is sad to see some lose it as he has been. He's a smart guy but he's lost sight of the fact that exponential growth curves do not always continue. We had geometric growth in our transport abilities for a while . . . but it ended. We are not heading off to mars these days.
I'm sure solar power will continue to get better & improve . . . but not on his delusional schedule.
Solar has always powered the world.
The oil part of the combustion equation: CHn + O2 --> CO2 + H2O + heat
is merely old and stored sunshine.
The oxygen (O2) part of the equation is the result of more recent sunshine
[ i.mage.+]
"Eight doublings, says Kurzweil, which will take just 16 years. "
It takes three years to build a plant and another one to get the kinks out and get it to full design. That's not counting the time to design it. But if you cooky cutter them the design only has to be done once. It's also not counting the EPA, not that the Chinese have to worry.
So that's 24 years instead of 16 right there.
Any chance we can be told anything about the "TOD Community Monitor" who has just started to appear in threads? Is this one person, multiple people? Are they anonymous. Do they have a job description etc? is "kater" a clue?
It's a bit of a surprise when someone nobody has ever heard of suddenly appears with no warning in the middle of threads as happened last night.
I'm probably over-reacting but I feel very uneasy about the future of TOD.
Nate put a comment elsewhere about this, and pointed to where this was announced:
http://www.theoildrum.com/node/7132
Nothing has changed in terms of policy since then, and moderation always has good and bad. The goal is to let people discuss but also to keep things under control (e.g., not having discussion veer to far from the main topic, no personal attacks, etc.). The moderator has mostly kept a low profile. We probably do need a mechanism for communicating what is going on, although sometimes emails have been sent.
My understanding, anyway...
JB
Kate has actually been moderating the threads here, including Drumbeat, for awhile. Since the start of the year, I think. As JoulesBurn said, we announced we would be adding a moderator last fall, and we have. I've been very pleased with her work.
Saudi monarch announces billions in handouts
This again, you ask? Oh no, even more this time.
He's getting nervous.
The king is old, and seemingly desperate. The Saudis are not acting responsible.
If he gets unrest in his streets in the coming years, he may feel inclined to keep off the exports in order to 'save it for our sons' as he put it 2-3 years ago.
http://english.aljazeera.net/news/middleeast/2011/03/2011318174117916648...
New Process Cleanly Extracts Oil from Tar Sands and Fouled Beaches w/Video of Process
Saw that. It looks perfect; low water usage, low energy usage. Of course there are rate issues and the cost of the 1-alkyl-3-methylimidazolium , but it's a positive move.
More info: http://www.matse.psu.edu/news/ionicliquids
In addition to the article up top, Japan's Idemitsu plans full output amid fuel shortage, here is a very good summary of the oil refining situation in Japan:
http://www.downstreamtoday.com/news/article.aspx?a_id=26039&AspxAutoDete...
Plus here is another interesting situation report:
http://www.prnewswire.com/news-releases/japan-demand-to-hit-oil-market-a...
All ports and terminals for the export of oil out of Libya are closed, and will not reopen soon:
http://www.39online.com/news/local/sns-rt-international-us-litre72h66m-2...
Mexico posts 2010 rise in oil replacement rate
Mexico posts 2010 rise in oil replacement rate
Yes, but if they only replaced 80 percent of their production, it means discoveries fell behind production by 20%. It still means they are running out of oil, just not as fast as in recent years.
Also, note later down in the article:
Other branches of the Mexican government don't believe Pemex's rosy estimates of its oil reserves.
A reserve replacement rate of at least 100 percent of annual output is viewed by oil and gas analysts as a minimum measure of the long term sustainability of an energy company.
No comment needed.
King – I will throw a couple of points in. First, the reserve replacement issue is what drove the shale gas play for the public companies much the same as it’s doing for the fractured oil shale plays that are so hot now. Wall Street demands that reserve growth be shown y-o-y. Matters little how profitable the effort ultimately proves to be. The Eagle Ford play in Texas is profitable and will add to the reserve base. But it also suffers from a very high decline rate and thus demands an even higher replacement effort. We don’t play the EF because we’re not a public company. We only care about profit and plays like the EF are not as profitable as our conventional plays.
And a very important point about reserve replacement that some folks misunderstand: it’s about reserves in the ground….not replacement of production rates. PO is about rates and not reserves. For sake of argument let’s assume PEMEX numbers are correct and they can replace RESERVES they produced during the previous year. But that doesn’t mean they’ll sustain production rates. If it takes several times longer to produce the new reserves than the ones they’ve replaced than production will continue to decline even if they constantly replace reserves IN THE GROUND.
And is Eagle Ford a better play than Bakken ?
Alan
Not sure Allan. Not enough publicly released production history. But it may well offer a greater expansion. The EF (and equivalent but differently named reservoirs) stretches across the Gulf Coast from Mexico to Florida. But lots of potential variations that remains to be determined. The EF is gobbling up drilling resources at a tremendous rate. It’s starting to seriously impact conventional plays. But again it’s being driven by the public companies and the insane demand to increase reserves y-o-y. There is one a block of acreage that’s being offered at $25,000/ac when the original leases went for $150/ac. So you pay $4.5 million for 180 ac drilling unit and then spend $6.5 million to drill the well. You’ll see reports of 1,000+ bopd initial flow rates. But it's looking like an 80% decline rate may be common. A well coming on at 300-500 bopd (a reason for a big party in conventional plays) will likely not recover its investment let alone a profit.
But back to the public companies. The SEC has tighter requirements these days but will still typically allow 4 offset locations as proved reserves after you drill one good well. So even if your well is marginally profitable a public company might be able to book 5X the URR by drilling one well. Chesapeake has over 600,000 acs. That’s over 3,200 potential drill sites and 3,200 X URR. But they only have to drill about 640 wells to book the reserve increase. Yes…eventually the chickens may come home to roost. But in the meantime Wall Street will push these companies' value up. In the case of the shale gas driller the chickens caught the express train home thanks to the dramatic drop in NG prices. I don’t think anyone is expecting oil prices to fall by more than half but given the cost to develop the EF et al it might not take as much of a price slide to bring on the pain.
I’ll repeat the very old E Texas saying about boom plays: you roll into town with the first wagonload of saloon gals and roll out before the first drill rig shows up. The folks that will make the biggest return on their investment will never drill an EF well. They will flip their acreage to a public company and head to the house.
For sake of argument let’s assume PEMEX numbers are correct and they can replace RESERVES they produced during the previous year. But that doesn’t mean they’ll sustain production rates. If it takes several times longer to produce the new reserves than the ones they’ve replaced than production will continue to decline even if they constantly replace reserves IN THE GROUND.
And that will be the case with the Chicontepec Field that they are hoping will replace the Cantarell Field that once produced most of their oil. Chicontepec is very complex, is largely shale, has very poor porosity and permeability, and for reasons the Mexicans don't understand, most of the wells only recover about 3% of the oil in place (Pemex assumes 9% in its reserve estimates). They will have to drill tens of thousands of wells, more than have ever been drilled in Mexico before, and do an awful lot of work on them to get any kind of production.
All in all, it sounds like something that small American producers would love to have a go at, but I don't hold out much hope for a giant bureaucratic organization like Pemex getting much production out of it.
Rocky - I was thinking specifically about Chicontepec Field when I wrote that. From what little I know even with thousands of wells the flow rates are so low it would have little impact. I've made this point before: many folks don't realize how unique our small independents are in the world and how imporatnt they've been in maintaining our marginal production. I agree: turn a bunch of S Texas and Okie independents loose down there and the production rate would be many times greater than what PEMEX could achieve in 3X the time. Additionally PEMEX might even actually net more income from such an effort. All royalty revenue and no capex might look very good to Mexico these days. But we both know the politicians would never go for it. Maybe when the drug cartels take complete control it might happen. They may be murderous bastards but they are businessmen.
The BP Macondo well blow out last year is beginning to be forgotten but the legal side rumbles on.
Today the company(paid many millions) that has undertaken to test and find the problems with the Macondo BOP should have published preliminary results.
I can't find any news on this report, does anybody know anything.