DrumBeat: October 26, 2006
Posted by threadbot on October 26, 2006 - 9:19am
Topic: Miscellaneous
Oil shock absorber costing Saudi Arabia $1 billion a year
The cost of keeping spare oil output capacity ready to plug any gaps in global supply is costing Saudi Arabia more than $1bn a year. After reducing output in line with an Opec agreement to trim supplies last week, Saudi Arabia’s spare oil capacity will reach around 2.5mn bpd in November.The world’s largest exporter has pledged to bring that supply on line within 90 days if international supplies are threatened by a large unexpected supply outage.
The operating costs of keeping all that oil ready to go at such short notice is around $1 a barrel a day, analysts said.
It's not just New Orleans: Rising Seas and Stronger Storms Threaten New York City
Indonesian forest fires may fuel global warming: experts
Environmental opponents begin hunger strike in protest of coal-fired plants
U.K.: Miliband's power firms reward hint
Power companies could be paid in the future not for producing energy, but for saving it, Environment Secretary David Miliband has said.In comments certain to be seen as a preview of the Climate Change Bill expected in the Queen's Speech, Mr Miliband said energy production could no longer continue as if it had no environmental cost.
U.K.: Energy prices will rise, say experts
Problems at Britain's nuclear power stations will put pressure on energy bills and increase the risk of blackouts during any winter cold snap, a leading market analysis group warned yesterday.
ARBIL, Iraq - Through a steadily worsening security situation and deepening political divisions, a dispute is erupting between Kurdish leaders and the Baghdad regime over access to oil resources.
The Emerging Russian Giant, Part 2: Washington's nightmare
Ironically, the aggressive Washington foreign policy of the era of Vice President Dick Cheney and Defense Secretary Donald Rumsfeld since 2001 has done more to nurture the one strategic combination in Eurasia most dreaded by Washington political realists such as Henry Kissinger or Zbigniew Brzezinski...
Turkmen leader promises free gas, power
Turkmenistan's eccentric leader announced Wednesday that his energy-rich Central Asian nation would provide citizens with natural gas and power free of charge through 2030."This decision would help ensure a carefree life for our people," said President Saparmurat Niyazov. He said parliament had approved the action.
Production in Saskatchewan Oil Sands Years
It will likely be a decade before any oil is recovered from a huge oil sands deposit in Northern Saskatchewan. But a Calgary based exploration company says its excited about the potential.
Canada: More wind power viable
A study released yesterday by Ontario's electricity authorities says wind power could represent nearly 20 per cent of the province's power-generation capacity with little compromise to system reliability.
Professor says days of 'no oil' are nearing
FALL RIVER - What's worse than $3-a-gallon gasoline?No gasoline.
If New College of California Professor Richard Heinberg is right, we'll be dealing with "no gasoline" as early as 2010 and definitely by 2030.
That's it. No gasoline. Out. No more oil.
The Path Beyond Petroleum: Twelve Theses
1. Oil production in the year 2025 will be half that of the year 2000. If we combine those figures with those of world population, we find a ratio of 5 barrels of oil per person per year in 2000, but only 2 barrels of oil per person per year in 2025.2. Alternative sources of energy have been a failure because of an extremely insufficient energy return on energy invested (EROEI).
Energy crisis looming for UK data centres
A crisis is looming in the UK's data centres around the most fundamental of requirements: the need for power, according to a study published by BroadGroup consultants.The average energy bill to run a corporate UK data centre is currently about £5.3m per year, the study said. This figure is set to double to £11m over the next five years.
Japan Hits Big Setbacks in Push for Energy
Just five months after it was unveiled, Japan's ambitious 25-year plan to sharply increase oil and gas development is hitting snags, suggesting Tokyo may find it even harder than expected to stabilize the nation's future energy supply.
Nigeria veering toward instability
BP and Shell are defined by differences
BP and Shell look increasingly defined by their differences, rather than how they could complement each other. Shell, which reports its third-quarter results this morning, is investing ever more in the kind of unconventional energy assets such as oilsands in Canada and elephantine engineering projects such as Sakhalin-2 that BP has been shunning. Lord Browne is making a point of spurning the oilsands opportunity, demonstrating BP’s more cautious view of oil prices. (Independent analysts calculate that extracting crude from oilsands is viable only if the price of oil stays above about $35 a barrel. By steering clear of the oilsands, BP is styling itself as the prudent major.)
Everything's coming up roses for the oil industry. Exxon Mobil beat forecasts, and so did Shell.
Total Sets Deadlines for Solar, Wind to be Viable
French oil company Total believes wind energy must prove it is competitive by 2020 and solar power must do the same by 2050 if they are to avoid being sidelined, it said on Tuesday.
Biofuels could create new kind of corn
Corn raised by future Iowa farmers could look more like the corn produced by their ancestors, with more substantial stalks, biofuels industry experts said Wednesday.As investment in biomass-based, or cellulosic, ethanol production grows, so will demand for crop residue.
He and others predicted that some sectors could be hurt by the growing industry. Corn production may take cropland from soybeans, for instance, making soy products more costly. Higher corn prices, driven up by demand from ethanol plants, could increase costs for many livestock feeders.
"The intersection of agriculture and energy is going to be a disruptive event," said David Miller, director of research and commodity services for the Iowa Farm Bureau Federation. That "can be good or bad, but it is going to be disruptive."
Biofuels will and are competing for food. It's obvious, inevitable, and worrisome -- and even when it's mentioned in mainstream articles like this one, the serious implications are glossed-over.
But I don't expect the average American to get worked up over it, until they're the ones priced out. As it is, we import luxury foods from countries that cannot feed their own people. If we don't care that our chocolate is grown by child slaves who can never dream of tasting the crop they grow, why should we care if the ethanol in our car is grown by people who should be growing food for themselves rather than fuel for us?
You are correct on the benefits to farmers.
I live in Iowa, have been imployeed by a seed company in the past, currently work for an agricultural related business and attended the Growing the Bioeconomy Conference this year in Ames, Iowa. Take special note of the talks given by Dr.'s Miranowski, Jolly, Wisner and Euken, all professors in agriculture economics. They clearly show in their presentations that there will be a squeeze on the supply side of ag products when we build ethanol plants.
Farmers are at their wits end in getting paid a living wage for producing food. Food is kept cheap in this country at the expense of the people who grow it. Not every year granted, but over the long haul a few bad years can drive a farmer out of business. They are backing anything that increases commodity grain and food prices.
I disagree that people in Iowa do not understand the ramifications of using plants for fuel. They understand very well and expect a balance to be achieved some time in the future for land being used for food, fuel or structural materials. Currently it is only food. When other countries have a good crop, farmers lose money or must get a subsidy (greater subsidy?) from the government. Iowa farmers would rather have everyone pay them more but have the country spend less on imported oil and subsidies. Most people in Iowa understand this as well. Give the farming base more money and they will be better stewards of the land and spend more money locally, that translates into jobs. With enough income in the state you get new business development making farm equipment, service jobs and maybe even a new industrial base making real physical goods other than farm equipment.
The harsh reality is if Iowa ships more finished goods and less raw food stocks, out of state, the state nets more income. It is all about transfer of wealth. Where is the wealth being generated vs where do we want it to be generated? Right now there is a giant sucking sound of money going to oil companies and/or overseas. This must end, either by design or after all the wealth is sucked out of the state and country. And I am sure this means more food must be grown outside of Iowa but isn't that what the shop locally for food movement is all about?
absolutely positivly NOTHING will stop them short of the government breaking them.
pigs will get wings and fly before that happens.
Our agricultural, industrial system needs a disruptive event, but it is not the intersection between agriculture and energy. We already have said intersection with respect to all the massive inputs of energy to keep said system going. Energy saved is energy earned. I think it would be much more productive and good for the land if we rediscovered ways to use less energy in our agriculture rather than turn our agriculture into energy.
Historically (more than 150 years ago) almost everything of value came off of land. As recently as the early 1900's many products were made from plants. Pigments, paints, fibers, insulators, structural material, and on and on. Furniture, dwellings, fabric are all made from plants even today. Farmers grow more than just food and always have. The problem is that oil has forced farmers to grow almost exclusively food because oil products substitute for everything they used to grow. And I haven't even started on the animal products that are used for non food uses. Oil makes many of these pure waste products, rather than the added value products of my Grandfathers day.
I remember well the sheep we used to shear on the farm. The geese for feathers. Hemp needs to make a comeback.
I think if this country survives the meltdown then it has to come back else we won't have anymore plastic clothes.
I always did prefer cotton and wool. Let the wimmen go back to the ironing board and forget 'permament press'. Obligatory smiley and several LOL's so I don't get lambasted. Only kidding wimmen, only kidding!
reduce the population enough and we can once again do the same but of course the required die-off is not what you want if you want to go back to that.
In other words, it must be more profitable than selling the crude directly to refiners,
You can eliminate the feedlot cattle/cheezo subsidies now, or be forced to later.
http://www.cnn.com/2006/WORLD/americas/10/24/chavez.un/index.html
While tuned to CNBC this morning, one of the commentators, while talking about the surge in oil prices yesterday, commented; "And there is more oil coming on line. Royal Dutch Shell just announced that they would develop areas in the deepwater Gulf of Mexico. They will bring as much as 130,000 barrels per day online by 2010."
I went to the computer to find out what I could about this great event.
So there you have it, 130,000 barrels of oil equivalent by around the turn of the decade. Well, I believe 2010 would be extremely optimistic as no test wells have even been drilled yet. Then multiple wells would have to be drilled and a platform would have to be built and so on. Hell, the first reports from the developers of Jack 2 put the startup date at 2013. That was before the talking heads on CNBC and Bloomberg put the likely startup date much sooner.
But the important point is the 130,000 BOE. Perhaps a little over half of that will be crude. And by 2010 or 2012 or whenever that comes on line, it will not amount to a hill of beans. The ultra deepwater GOM may be profitable for the companies, owing to the very high price of oil by that date, but it will do little to impede the decline in world oil production.
The ultra deepwater GOM is hyped by the talking heads on the financial news networks, and by the peak oil naysayers as proof that there will be no problem with world oil production in the coming decades. They are totally out of touch with reality.
Ron Patterson
Insurance rates pummel Florida homeowners
I wonder how long it will be before those who aren't living in harm's way start getting angry at repeatedly bailing out those who do?
I was wondering whether the big rate increase was due to actuaries factoring in rising sea levels from global warming and other climatic anomalies or if we were going to be subsidizing higher risk properties elsewhere. This article points to the latter variable as the most plausible explanation.
I'm in Yachats on the west side of 101 at the very edge of the tsunami inundation zone. From '05-'06, our premium went up 5.9%; but I'm unable to say exactly where the rise occurred (we have Farmer's). Our auto insurance is through the same company, but it rose only 3.5%; so, something other than inflation accounted for the difference. When we receive our next premium bill, I'll definately scrutinize it. Thanks for the tip-off to something I usually don't look at (I'm not in charge of paying those particular bills).
I understand that we might be able to avoid a steep rate increase if we get a surveyor to come out and provide us with an elevation certificate showing that we are in a lower risk zone. Just FYI, the flood insurance rates are determined exclusively by the feds, not the particular insurance company who just acts as a go-between. However, I think some insurance companies may be more willing to give the customer the benefit of the doubt than others. We currently carry the flood insurance through USAA but when we got the run around trying to get information about the possible rate increase we called State Farm, our carrier for our auto and home insurance. State Farm quoted the same low rate we have been paying and they said they didn't need an elevation certificate.
By the way, I was hoping to start up a Lincoln County and central OR coast peak oil community group but then got tied up with some professional and family obligations that made it impossible to proceed. Are you aware of any such groups starting to form up in the area?
From
http://tinyurl.com/badb5
blah blah blah..
"
Climate variablity ratchets down the slide in coastal property values
Coastal property values erode with the rest, but at a much lower rate. Some highly desirable properties in highly desirable locations don't lose value at all. But extreme climatic events caused by shift in climate event intensity and locality with increasing sea temperatures can change everything. Storms of unusual intensity driven by warmer oceans, in turn caused by unprecedented increases in the 'greenhouse effect' gas carbon dioxide (from coal, oil, and gas 'unlocked' from its geological tomb) can abruptly turn an entire generations mindset from coveting coastal land to despising it. At the point of greatest fear, property prices for coastal land collapse. The cost of repairing coastal infrastructure destroyed in tidal surges and hurricanes is far greater than in the peak of cheap oil. The burden falls on local counties and ratepayers, saddling them with debt stretching far out into the future. Worse, the insurance companies start to draw red lines around low-lying coastal areas. They will not write insurance for any home or business within these zones. Values for uninsurable properties fall further.
Example: In the 1920's buying and selling Florida real estate became known as a road to instant riches. In the height of the bubble, real estate prices quadrupled in less than a year. When the bubble burst, property speculators were forced to sell to try to avoid bankruptcy. Most failed. The lack of buyers was made very much worse when an unusually strong hurricane hit Southern Florida in septemebr 1926. Wind-driven tidal surge turned large areas of low land into swamps, and a huge storm wave slammed into several coastal towns. In all 13,000 homes were destroyed and 415 people died."
The sub-context, of course, is peak oil=>peak gas>peak coal=> peak CO2=>peak wave height=>peak insurance premiums
If peak insurance premiums are solved, peak hydrocarbons are solved...although, what does Jerome a Paris pay for an offshore wind turbine? Or is there a massive tail end feathering system...?
http://www.chron.com/disp/story.mpl/business/4288529.html
Helicopter pilot salaries have gone up a fair amount in the pass several years, and from what I understand, aside from the normal level of danger operating one of those machines, landing on an oil rig can be particularly fun from what I understand.
I've always wanted to fly helicopters, and someday I hope to get a license to. Perhaps I should consider going beyond just a regular license and go for a commerical one.
However, this college student did make $100K each summer diving for sea urchins.
I could not imagine being a college student, having no responsibilities, and having $100K each summer.
Production was 11% lower than August last year. With the exception of August this year, the production statisitics for August last year were the lowest production figures since at least 1980.
But its the import/export figures that hide the most danger - for the past 15 years plus until 2005 theUK was an oil exporter - by 2005 it was, still one, by the skin of its teeth - or 2,424,000 tonnes, a massive fall from figures of only 5 years previously.
This year it is so far a NET IMPORTER of 4,807,000 tonnes - the annual total for 2006 is likely to be at least 6,000,000 tonnes - and the figure for 2007 will in all probability exceed 10,000,000 tonnes.
The UK already has a massive and persistent trade gap with total goods imports far exceeding exports - now oil is going to make that position much much worse. Ultimately this must torpedo the pound, which in turn must have serious impacts on interest rates etc.........
It doesn't hesitate to hand out large fines to Microsoft, or to ban GMO seeds. And it follows through on what the countries themselves have pledged in emissions cuts. But these are not simple issues.
It easier to demand performance from member states than from carmakers, which in turn is easier than putting hard limits on international flights.
Yeah sure, BA and Lufthansa are going to relocate to Bahrein! (well actually BA might)
Obviously, it's an all-or-nothing affair, taxing airlines (one way or another). People want to fly to Europe, the airlines will pay the taxes.
The UK opposed this for years, but seems to have come around. Heathrow in particular is a hub, people change planes there who are not travelling to or from Europe. Such traffic would be driven elsewhere by taxes, but that's no big deal.