... A senior US official insisted the exercise is not aimed specifically at Iran...

The exercise, set for October 31, is the 25th to be organised under the US-led 66-member Proliferation Security Initiative and the first to be based in the Gulf near Bahrain, across from Iran, the officials said...

"It's an effort to bring a lot of Gulf states together to demonstrate resolve and readiness to act against proliferation," said the official, speaking on condition of anonymity.

The Proliferation Security Initiative, established in 2003 under President George W. Bush, is a voluntary association of countries that agree to share intelligence information and work against the proliferation of weapons of mass destruction, including through military exercises that practise interdiction techniques and coordination...

http://www.gulfnews.com/region/Bahrain/10074440.html

http://www.menafn.com/qn_news_story_s.asp?storyid=1093129081

Nice to see that it hit the theme I've shared, of happiness and not GDP, or ever-higher energy consumption.

KUWAIT: The Chairman of the Board of Directors and Managing Director of Kuwait Oil Company (KOC), Farouk Al-Zanki announced that in case the Northern Oil Fields project was not approved by the parliament, KOC had many other alternatives in raising its production in accordance to the strategy set for until 2010 with an aim to boost Kuwait's daily production to 4 million barrels, reported Al-Qabas. "Any delay in going ahead with this project would surely affect our strategy and we will not stand by doing nothing", warned Zanki remarking that he was optimistic about the final decision of the parliament in this regard. Responding to a question concerning declaring Kuwait's actual oil reserves, he said such a question should be directed to the Ministry of Energy.

http://www.safehaven.com/article-6082.htm

Does anyone note the complete and utter disconnect as to how China can be importing 24% more crude - year over year - in the face of declining output from the world's super giant oil fields [Cantarell - Mexico, Burgan - Kuwait, Ghawar - Saudi Arabia, Prudhoe Bay - Alaska, North Sea etc.]? Never mind the fact that the U.S. Gulf Coast never did recover from lost production of both nat. gas and crude in the wake of Katrina - much of which has NEVER been replaced.

Now if you remember, the WSJ and the rest of the media during the run-up in oil prices vigorously denied any correlation between gas prices and a decline in economic activity. Yet, as soon as prices go down, suddenly this will be a lift.

This mis-reasoning was led by no other greater figure than cheer-leader in chief, Alan "The Bubble" Greenspan. Mr. Greenspan made a new bunch of ridiculous remarks yesterday, basically contradicting much of what he said as Chairman. As an aside, in political theory, Mr. Greenspan is the definition of unaccountable power, and if you have unaccountable power, you don't have self-government.

Mr. Greenspan has now been out talking how his last bubble, American real estate, was A)not his fault B)will cause no damage. Mr. Greenspan said yesterday about housing, "the worst may well be over." Yet on the very same day the Los Angeles Times reports:

"Southland home prices in September rose at the slowest pace in nearly a decade and sales continued to fall sharply, according to figures released today," and "The median price paid in September for a home in San Diego County, one of California's most closely watched housing markets, fell 4.4% from a year earlier, the local median's biggest year-over-year drop in 13 years, DataQuick Information Systems said Wednesday."

Finally, Stephen Roach of Morgan Stanley says, there are, "visible manifestations of excess liquidity everywhere" and "Central banks have created a monster -- not just liquidity-driven excesses in financial markets, but also major cross-border imbalances in the global economy and mounting political tensions associated with those imbalances."

So, while the ignorance of the American people is numbing, the blame goes right to the corrupted decadent top.

Have a nice day.

Homeowners moving away from ARMs

About 88 percent of borrowers who are refinancing increase their debt balance by more than 5 percent, according to Freddie Mac.

Ms. Cutts said many borrowers who took ARMs were hoping that interest rates would remain low for many years.

"It's hard for me to believe that the average ARM borrower didn't know what he was getting into," she said.

For the first seven months of 2006, Norway's average production has been 2.538 million barrels per day. This report says that September production averaged 2.25 mb/d. That is .288 mb/d below their average for the first seven months of the year. And that is before the .28 mb/d cut for two weeks this month.

Looks like Norway, and the rest of the North Sea is in a steeper decline than most of us had guessed.

On a different subject, this month's IEA Oil Market Report has world oil production down 180 kb/d to 85.4 mb/d. However last months report had world
production down 400 kb/d to 85.8 mb/d. This means that last months data was revised downward to 85.58 mb/d or a drop of 520 kb/d from the July figures. Or another way of looking at it, the IEA's revised estimate for July is 86.2 mb/d. Now they are estimating September production to be 85.4 mb/d, a drop of 800 kb/d in just two months.

Ron Patterson

Somehow you get the feeling that, though it's obvious that acting now rather than later would be much cheaper, there is a sense of comfort in talking about a date that is so far into the future that none of us will likely be alive when it arrives (immortality is the last thing you would wish for, given the circumstances).

It makes you suspicious of the reasons these reports are written and presented the way they are. It makes the whole issue so abstract that people will just shrug and get in their cars. And maybe that's the whole purpose.

Besides, think about the effects that inflation might have on these numbers!! It might cost more in absolute numbers, but isn't that relative to unknown factors?

Why do anything inconvenient when you won't be there to see the results anyway? You think yeast care for their offspring when gobbling up the sugars?

Climate change calculated in trillions

"In one sense the numbers are arbitrary. What we are really talking about is whether your grandchildren will inherit a degraded world and will they ever know what a polar bear was like. We are on the brink of a catastrophe not recoverable on any human timeframe. How many trillions is that worth?"

Using the World Integrated Assessment General Equilibrium Model, to give it its full name, they calculate the annual economic damage caused by a 4C rise in temperatures above their pre-industrial level to reach $20 trillion. But if the temperature increase were kept to 2C, that cost could be reduced by some $12 trillion. The amount that would need to be spent on climate protection measures to achieve that reduction would be $3 trillion a year.

Combating global warming is not only affordable but could create a climate change market worth £30bn to British businesses over the next decade, says a report funded by the oil giant Shell.

The cost of tackling climate change in the UK by 2010 would be equivalent to just 0.3 per cent of GDP, according to the Shell Springboard report.

Globally, concerted action to stop the rise in greenhouse gas emissions could create a worldwide market worth $1 trillion in the first five years alone.

Cheaper gas tugs on retail sales

Spending at the nation's retailers fell in September, according to a government report, but a big part of that drop was a result of reduced spending at the gas pump.

The Census Bureau reported that retail sales fell 0.4 percent in September, following a revised 0.1 percent rise in August. Economists surveyed by Briefing.com had forecast a 0.2 percent rise in sales.

But gasoline station sales fell 9.3 percent in the month compared to August, as gasoline prices fell sharply. Excluding what was spent at gasoline stations, retail sales rose 0.6 percent in the month.

The term used for energy quantity was "quads."  A quad is defined as one quadrillion BTUs.  That's 1 followed by 15 zeroes.  The graphis shows proportionate colored stripes for someatic and imported oil, natural gas, coal and other, none separately quantified.  The total energy used in 1960 was 44 quads for a population of 181 million, of which 23 quads were noted as "lost."  For 1979, the total was 79 quads for the population of 221 million, of which 45 quads were lost.  This calculates to a per capita use in 1960 of 2.43 billion BTU with 43% lost; in 1979, the per capita use was 3.57 billion BTU with 57% lost.

The "lost" energy is attributes to heat from engine combustion and from transmission lines, and that from conversion losses in steam generation.  I would add loss from buildings, as particularly illustrated by the ubuquitous "heat domes" over cities, and the spectacle of light on the earth as seen from space at night, even 25 years ago.  Exhaust from air conditioning would have become more significant by 1979.

The growing magnitude of the lost fraction -- over half the energy used in 1979 -- if translated to 2006, is frightening.  Granted, much of such loss is inevitable, but one would think that there is room for both the technology sector and us peasants to try to improve those percentages.  Think EROEI on the use side, and that half of every barrel of oil or lump of coal becomes unwanted heat.

There has been some progress toward that goal in the form of extra insulation, thermal windows, smaller and higher-mileage cars, etc.  Just living smaller and slower along with trading with local producers where possiblewould seem useful.

Cheers,
-- Mort

http://www.citizen-times.com/apps/pbcs.dll/article?AID=/20061012/OPINION04/61011037/1006/OPINION

During UNC-Asheville's Greenfest next week, you'll have the chance to see a movie that will change the way you think about coal.

Three students at Warren Wilson College have made a powerful documentary on mountaintop removal. Not only is this method of extracting coal devastating to the environment, it destroys people's very way of life. "A Mountain Removed" gives a voice to some of the West Virginians affected by a mining operation.

...

The liquid waste, or slurry, is dammed up in impoundments, forming toxic lakes of carcinogenic chemicals and heavy metals like arsenic and mercury. Just a few years ago, an impoundment broke near Inez, Ky., turning 75 miles of rivers and streams black. According to the film, this released 20 times the amount of oil lost by the Exxon Valdez oil spill.

The documentary offers an impressive amount of information, considering that it clocks in at less than 30 minutes. Its power lies in the personal stories told by residents of a small mountain community in West Virginia. The filmmakers wisely keep narration to a minimum, letting the people explain in their own words.

...

A free screening of "A Mountain Removed" will be shown on Tuesday, Oct. 17 at 7 p.m. in room 125 of Rhodes hall on the UNC-Asheville campus. A panel discussion will follow.

Economics: The Sound of Aunt Edna's Knitting
by John Michael Greer

http://www.energybulletin.net/21327.html

If you don't have access to garden space, consider taking up a useful handicraft or two. Aunt Edna's habit of knitting cardigans for all and sundry may have seemed quaint in the heyday of the industrial economy, but when central heating prices itself out of existence and transport costs put paid to clothing imports from Third World sweatshops, warm clothing you can make with your own hands has obvious value, and may also be a useful item of barter. The same is true of many other skills, from soapmaking and herbal medicine to the handyman skills that allow plumbing, furniture, and appliances to be repaired at home.

Westtexas, the user, often talks about how West Texas, the oil
field, produces 1 million barrel a day with a oil cut of about
1%. My questions are:

 
1. Is it common to 'work' a field to such a low ratio of oil?
 
2. For how long will they continue?
 
3. Where do they get the water?

TIA.

Imagine Earth without people

If tomorrow dawns without humans, even from orbit the change will be evident almost immediately, as the blaze of artificial light that brightens the night begins to wink out. Indeed, there are few better ways to grasp just how utterly we dominate the surface of the Earth than to look at the distribution of artificial illumination (see Graphic). By some estimates, 85 per cent of the night sky above the European Union is light-polluted; in the US it is 62 per cent and in Japan 98.5 per cent. In some countries, including Germany, Austria, Belgium and the Netherlands, there is no longer any night sky untainted by light pollution.

"Pretty quickly - 24, maybe 48 hours - you'd start to see blackouts because of the lack of fuel added to power stations," says Gordon Masterton, president of the UK's Institution of Civil Engineers in London. Renewable sources such as wind turbines and solar will keep a few automatic lights burning, but lack of maintenance of the distribution grid will scuttle these in weeks or months. The loss of electricity will also quickly silence water pumps, sewage treatment plants and all the other machinery of modern society.

The same lack of maintenance will spell an early demise for buildings, roads, bridges and other structures. Though modern buildings are typically engineered to last 60 years, bridges 120 years and dams 250, these lifespans assume someone will keep them clean, fix minor leaks and correct problems with foundations. Without people to do these seemingly minor chores, things go downhill quickly.

[..]

Meanwhile, the tall, graceful corals and other bottom-dwelling organisms on deep-water reefs will gradually begin to regrow, restoring complex three-dimensional structure to ocean-floor habitats that are now largely flattened, featureless wastelands.

Long before any of this, however - in fact, the instant humans vanish from the Earth - pollutants will cease spewing from automobile tailpipes and the smokestacks and waste outlets of our factories. What happens next will depend on the chemistry of each particular pollutant. A few, such as oxides of nitrogen and sulphur and ozone (the ground-level pollutant, not the protective layer high in the stratosphere), will wash out of the atmosphere in a matter of a few weeks. Others, such as chlorofluorocarbons, dioxins and the pesticide DDT, take longer to break down. Some will last a few decades.

The excess nitrates and phosphates that can turn lakes and rivers into algae-choked soups will also clear away within a few decades, at least for surface waters. A little excess nitrate may persist for much longer within groundwater, where it is less subject to microbial conversion into atmospheric nitrogen. "Groundwater is the long-term memory in the system," says Kenneth Potter, a hydrologist at the University of Wisconsin at Madison.

Carbon dioxide, the biggest worry in today's world because of its leading role in global warming, will have a more complex fate. Most of the CO2 emitted from burning fossil fuels is eventually absorbed into the ocean. This happens relatively quickly for surface waters - just a few decades - but the ocean depths will take about a thousand years to soak up their full share.

Even when that equilibrium has been reached, though, about 15 per cent of the CO2 from burning fossil fuels will remain in the atmosphere, leaving its concentration at about 300 parts per million compared with pre-industrial levels of 280 ppm.

"There will be CO2 left in the atmosphere, continuing to influence the climate, more than 1000 years after humans stop emitting it," says Susan Solomon, an atmospheric chemist with the US National Oceanic and Atmospheric Administration (NOAA) in Boulder, Colorado. Eventually calcium ions released from sea-bottom sediments will allow the sea to mop up the remaining excess over the next 20, 000 years or so.

They first need to go to the 5500 homes and businesses and shut off service at the gas meters.  Then they can start re-pressurizing the main system.  Finally, they go door to door, and turn the individual service back on and verify that your appliances re-light properly.  This is to avoid blowing up a house with an old water heater.  Here is a link -
http://www.ci.buffalo.mn.us/PRESSRELEASE.htm

CenterPoint brought in 200 service people for this project (I counted 120 vans at one of the city facilities on my way home last night).  Personally it was not a major issue.  Temps were around 30 last night.  I have no furnace or hot water.  One small space heater kept the living room at 66 all night where the kids slept and my wife just had to snuggle a little more.  I showered at the gym and the kids can go a day without hot water.

But then I think about what would happen if this was on a larger scale - say Minneapolis in January.  It took 200 technicians a day and a half to service 5500 customers.  The 200 was said to be 'every available technician'.  How long would it take them to restore service to a much larger region, when weather conditions were worse?  How much energy is required for this project, and what if this becomes an issue where supply lines run short in areas on a more frequent basis?  How long does it take your pipes to freeze if you have no heat and it is 20 below out?

Like I said, not a big deal for me, but I could see this being a huge issue in the future if the quality/quantity of the natural gas supply can no longer prove to be adequate.

  Please note, I don't know any of the answers. But If you do, please enlighten us.

  How much Sunlight on the average flows to the earth?  How much of that sunlight can we harvest?

  Granted that most Plants harvest it rather well.  But will we get better use of it by harvesting those plants and turning them into power generated for some use or by building solar collection devices to turn that sunlight into usable energy?  

  What is the maximum acrage that can be planted in the USA or World?  How many laborers would it take if all of it were done by hand and not by diesel powered tractors?

  We can plan to grow our own gardens with our own work and totally relocalize some of our cities.  But how do we handle the big cities in places like Las Vegas and New York, or Hong Kong,  where the number of people in them far out strip the area's ability to provide them food?

  As some people have mentioned they don't believe that we will go through so bad of a time as others on TOD have said they think we will go through.  No one really knows the future, we have ideas from our readings and our own thoughts.  Few of us want the world to crumble and burn around our feet.  

  Then I look out my window and see Autumn leaves falling and hear the heater kick in and realize I have driven ZERO miles in my van this month.  Two years ago I would have driven 455 plus miles by this time of Oct. I have 3,150 miles left to drive this year, on my balance sheet.  I drove a lot in the spring and early summer and did a bad job of keeping my milage down.  Just going back and forth to work was putting 7,800 miles on the road.  
I have made a few improvments on my energy usage, What have some of you done?  ( I do realize that some of you live off your land unlike most of us and you are doing 10 times better than most of us, its just a thinking question not one meant to raise hackles. )

While these [demand] trends could be upset by geopolitical turmoil or economic recession, there's no doubt long-term growth in Asia will reverberate elsewhere. "By the middle of this century demand for food will double," says Woertz. "Also by mid-century, energy from traditional sources will be insufficient to meet projected global demand. Traditional refining capacity, in both the U.S. and globally, will also be insufficient to meet motor fuel demand."

To meet projected demand for fuel through 2015, the world would have to add capacity of 9.5 million barrels a day - the equivalent of four new refineries as I as the largest refineries in the world - every year for nine years. However, the United States has not built one new refinery in the last 30 years. That's why alternative fuels are needed. But how big should that market become?

Woertz cautions anyone who may discount the potential expansion opportunities for ethanol or biodiesel based on current technologies. Those will change and get better, she predicts. She compares biofuels to the automotive industry at the start of the 20th century, or the microchip industry in the 1980s.

• The world will not add production of 9.5 million barrels a day by 2015 -- a new Saudi Arabia or Russia. Isn't going to happen, folks.

• As Robert notes above, NREL been working on cellulosic ethanol for 30 years without success. And now there's going to be a breakthrough?

• World food production is dropping now. Yet we will need to double food production to meet demand by 2050. Simultaneously, the world will devote more and more of its croplands to growing biofuels. And then there's the climate. I'm worried right now about what the changing climatic effects on massively scaled monoculture farming will be in 10 years. 2050? How about 2015 instead?

  This is all an inconsistent fantasy. I suppose that's the thing about fantasies -- they can be anything you want them to be.

I myself am worried about where the oil is going to come from to guide a transition to implementing whatever substitutes we can and powering down.

The lights are on, but nobody's home

illegal border crossings story

Bhakta decided to see if he could get an elephant accompanied by a six-piece mariachi band across the river.

"To my surprise, the band played on, the elephants splashed away, and nobody showed up," Bhakta said of the stunt. "I'm astounded."

He said he was "staggered" by what happened on Tuesday and was planning on sharing the story with his potential constituents.

"If I can get an elephant led by a mariachi band into this country, I think Osama bin Laden could get across with all the weapons of mass destruction he could get into this country," Bhakta said.

The mariachi band was not immediately available for comment.

Where do you get good data to make graphs for historical prices?

My knowledge is pretty thin -- pretty much everything I know came from articles here. I understand that not everything is heavily traded, so the more liquid investments have less risk.

Is Black-Sholes a model to start with for options pricing? I was a math major in college, so I should be able to eventually figure this out, but I'm not sure where to start.

thanks!