DrumBeat: August 10, 2006

[Update by Leanan on 08/10/06 at 10:18 AM EDT]

Gas Prices Alter Habits of Many, but Far From All

Car owners across the country braced themselves on Tuesday for another smack in the face at the gasoline pump, as the shutdown of the giant Prudhoe Bay oil field in Alaska rippled through energy markets and consumer psyches.

But Justin Ogle, a newly minted light-rail commuter, was calm. Mr. Ogle and his wife, Lauren, bought a new home two months ago, partly to be near the train tracks.

Consumers May Pay as Businesses Feel Pinch at Pump

As oil prices climb, the U.S. economy has become the arena for a tug of war over inflation.


MSU professor quietly creates one of nation's largest databases for wind energy research


BP's Prudhoe Bay a "giant water field"

"Really, we are a giant water field," said Bill Hedges, BP PLC's corrosion expert, explaining that what comes up now during drilling is three-quarters water.


[Update by Leanan on 08/10/06 at 11:24 AM EDT]

Saudi Oil: Far from Twilight
Michael Lynch isn't worried...

With the recent problems in the oil market, renewed attention has been focused on the theories of M. King Hubbert and a new generation of oil supply modelers, who believe that geological resources are scarce and a peak in global oil production is near. In fact, these analysts – usually geologists – are unfamiliar with statistical modeling and don’t recognize that they are engaged in curve fitting, not scientific analysis. The repeated failures of their predictions and their refusal to address substantive criticisms of their theories and methods are damning indictments of their claim to be scientific.


Meanwhile, Matt Simmons is proselytizing even on summer vacation in Maine: Energy Expert Warns Of Tough Times Ahead.

This question is mainly for westexas and was buried in yesterday's open forum:

Which countries are in the top 10 exporting countries?

Thanks in advance,
Rick

This is a good article that has a list of the top exporters (in 2004).  If you look at current EIA crude + condensate data, seven of the top ten are showing declines since December.  The other three are flat.

http://www.energybulletin.net/18475.html

Canada is not on that list.  Are they not an net exporter?  Or are they just not in the top 14?

Rick

Canada is a big exporter on the West side, big importer on the East side.
Yes, Canada is a net exporter.  It just doesn't export that much on a net basis.  Not enough to put it in the top 14.

Of course, listening to Canadian leaders lately, one could be excused if they were led to think otherwise.

Our prime minister recently talked up the nation as a new "emerging enery superpower".

Who knows, someday we may overtake tiny Qatar!

For 2004, which is the last complete data set from the EIA, Canada comes in at number 16, with 840,000 barrels per day of exports. In 2005 their exports were 820,000 barrels per day, but I can't compare this to any other countries, since Mexico is the only other country that the EIA reports 2005 numbers for.
Huh?  According to this EIA page in May 2006 Canada exported 1.868 million barrels of crude oil per day to the United States alone!

Do oil sands not count?

Canadian tar sands production is over 1 million bpd currently, it is counted as part of their total crude production of approximately 2.5 million barrels per day. Add to this RPG,NGPL, and other liquids and you get 3.135 mmbpd "all liquids" daily production in 2004. Subtract 2.294 mmbpd consumption in 2004 gives us 841,000 bpd net exports. These are EIA's numbers, my math.

BP's 2005 numbers for Canadian production and consumption basically match these. BP gives 1.6 mmbpd exports in 2005 - matching that figure you found of 1.8 mmbpd in 2006.

Houston, we have a problem. The only explanation I can come up  with is that they are receiving imports of approximately 800,000 bpd from the US. Didn't Westexas say that was the case above somewhere?

Anybody know?

BP's 2005 figures for Canada (mmbpd):
  Production -  3.047
  Consumption - 2.241
Difference is 806, not far off the 841 figure.

But Canada imports 934 mmbpd (not counting product imports), mainly from Europe. Added to the 806, that gives 1.74 mmbpd as exports. This is intermediate between the two figures above.  

I think that is exactly the million barrels we were looking for. Thank you.

Now for extra credit, can you explain why? When you say Europe, I'm guessing that's mainly the North Sea? or Russia?

Refining ability? To send the product to the States?

Mainly from the North Sea. Remember that almost all Canada's imports are consumed in Quebec and the Atlantic Provinces.

Product exports Canada->US in 2005 were 558 mbpd on top of the  1643 mbpd crude exports, according to BP. Sorry about the units mixup above.    

Remember that almost all Canada's imports are consumed in Quebec and the Atlantic Provinces.

What are you, crazy:) How was I supposed to remember that? I didn't even know it to remember it. Seriously. You should post more often here. We really, really like this kind of information. At least I do. Screw up the units all you want, we'll fix'em later.

Why can't Quebec and the Atlantic Provinces get their stuff via pipeline from Western Canada? That's the part I'm unclear about. It really makes more sense to ship crude from Europe rather than pipe it from next door?

Is it possible to make this equation more efficient?

It is more efficient (net transportation wise) to supply the Upper West (US) & Midwest from Alberta pipelines and Eastern Canada from the sea than vica versa.  Look at a map.

New Orleans would like to barge more oil products up-river instead though.

Absolutely. So the next question is, why do we as intelligent individuals, as a society, allow The Powers That Be to manipulate the numbers so that things can always be something they are not.

We complain about transparency. It is time to clean up our own  back yard.

Canada - (and my beef is not with Canada, it is with us) - Canada exports 840,000 bpd, not 1,840,000. Or, conversely, it does both. But we need a standard for reporting these numbers.   Else the manipulators will run circles around us. They will use any number they want, whenever it suits their purposes.

Are we on the same team?

Thanks for pointing that out, by the way. You have a future here.
The link below

http://energikrise.blogspot.com/2006/07/produsenter-og-eksportrer-av.html

leads to a Norwegian blog that recently posted some diagrams (in English) that shows the worlds 10 biggest producers of hydrocarbons (oil and natural gas) as of 2005 baseed upon BP Statistical Review 2006.

the second diagram shows the world 7 top net exporters of hydrocarbons (oil and natural gas)

Hope it can be of some help.

According to Stats Canada, run rate was 790,000 bbl/day total export Dec 2005.

Breakdown by US destination also available:  
http://www.neb-one.gc.ca/Statistics/CrudeOil_PetroleumProducts/index_e.htm#Year2005

Global Oil Exports 1988 - 2003

I stacked the countries to make the graph readable, obviously they are not in order, but you should be able to figure out the top 14. I have to update this for 2004 numbers(maybe 2005, I forget what is currently available). I might actually get around to this today, in which case, I'll list the actual numbers.

Interesting. How come they add up to <55%?
45% of oil in the world in consumed domestically. 55% is exported. And this number has been rising since 1988. Although I'll have to update this to know the short-term trend.
So therefore; "net export capacity" is
still rising if I'm reading your
graph correctly ??

Triffin ..

The long-term trend has been rising.

The percentages for the last 6 years on record:

1998- 54.1%
1999- 53.4%
2000- 54.1%
2001- 53.6%
2002- 52.3%
2003- 53.5%
2004- 54.4%

So it looks like net export capacity is currently on a plateau if you look at last 6 years, rising if you use last 3.

Keep in mind the last data is for 2004, 20 months old. If it has been falling since that point, it is unlikely that it is lower than 52%.

The graph I would like to see is country by country of the top 10 say,  one line production, the other internal consumption.

How many of those lines cross?  Hence no exports.

JC

I'm not sure what you are saying. The top ten all export between 1.5 and 9 million barrels per day, which is the difference between their production and their internal consumption. So no lines ever cross, else they wouldn't be exporting. If you can elaborate, I can make graph.
Take Indonesia for example,  it's production line on the graph went up from the lower left hand corner to the upper right.  Their internal consumption did the same.   UNTIL the lines crossed and now(even though their still OPEC?) the are a net importer.

See?

Most people are not aware that countries that produce oil actually use it themselves.   (As stupid as that sounds, I believe it to be true).

John

Right, but they are not in the top ten. Indonesia is a rare example. In my graph above I included them in the "other" category, since, as you point out, their exports have gone negative.

The top 17 exporters ratios are relatively stable. The remaining 20 have changed over the last twenty years, but mostly in order. If I did a line-graph like this I think it would just look like spaghetti.

I'll play with the numbers later and see if I can come up with  something.

It's exports / consumption.  These countries also use some of the oil. (thats at least I my guess at why)
Exports -- missed that. Thanks!
The link below leads to a Norwegian blog with diagrams (in English)

http://energikrise.blogspot.com/2006/06/utvikling-i-global-netto-oljeeksport.html

illustrating (diagram clickable for larger view) the development in net oil exports, by country, for the years 1985 - 2005 based upon BP Statistical Review 2006. Seems like net oil exports has seen little growth since 2003.

Hope it is useful.

Iogen......

How feasible is second generation Biomass production of Ethanol ? I am interested because apparently Iogen uses ANY source of cellulose to produce ethanol. This would remove a lot of the energy sinks from the production process. The process itself appears to run on heat generated from burning what's left over after extracting the cellulose from biomass.

This would make the EROEI equation very possitive. Do you think  they have a posible solution, is enough usable biomass available (near potential factories) to produce a significant amount of ethanol?

In Germany, Volkswagen and DaimlerChrysler started projects on BTL-technology.  Volkswagen called their fuel "SunFuel" while DaimlerChrysler's fuel was named "Biotrol" (biomass + petrol = biotrol). Nowadays both companies work together with a company called Choren  and call the fuel "sundiesel".  Choren is located in Freiberg (Saxony) and has developed the so-called and patented "Carbo-V®" gasification process.
According to Choren it takes 5 tons of biomass to produce 1 ton of sundiesel and 1 hectare generates 4 tons of sundiesel.  A plant producing 13,000 tons per year would need the biomass of 50,000 ha.  In recent years the German set-aside area amounted to roughly 1 million ha. This could generate 4 million tons of sundiesel, which is about 13 percent of current diesel use in Germany.
DaimlerCrysler expects that BTL fuels could achieve a market share of 10 % in Europe by 2015.  Volkswagen cites a study that sees the production potential for BTL at 70 million MT of fuel in the EU-15, which would amount to one third of the fuel currently used by all vehicles (cars and trucks) in the EU-15.

This is about diesel, though, but it should give you an idea.

If 1 ha. produces 4 tons of sundiesel, wouldn't a plant producing 13,000 tons only require slightly more than 3,000 hectares?  Or does it take 4 hectares to produce 1 ton of sundiesel?
Good comment. The text above is from

http://www.fas.usda.gov/pecad/imagery_archive/highlights/2005/01/btl0104/syntheticdiesel.htm

I had a look at Choren's homepage, they say they need 4 tons of biomass to make 1 ton of sundiesel, and that one hectare can produce 3-6 tons of sundiesel. So, a 13.000t plant needs 50.000t of biomass, not 50.000ha.


I'm wondering if anyone can find information on storage costs for ethanol in Brazil the numbers seem hard to find since Petrobas seems to underwrite the storage costs. Running the number shows that we would need millions if not billions of gallons of storage if we use significant quantities of ethanol.

I know that storage or tank farm can be expensive for oil I don't expect the costs to be cheap for ethanol and the numbers are mind numbing they make the SPR look little.

Mike

I would imagine "Silo" could be considered "ethanol storage" as well.
Iogen can use hardwood as a feedstock but not softwood and they've had a demo facility up and running for some time now, however, the feasibilty of 2nd gen ethanol production will really be determined from commerical operations.

In answer to your second question... Yes, there is more than enough biomass and renewable waste resources to make a considerable dent in daily gasoline consumption.

Hello TODers,

Are Californians are going to have to have their dead fingers pried off their SUV's steering wheel?  Good Article!
------------------------------------------------------
"People haven't paid for the gas they bought two years ago," he said.  Hamilton says that when, not if, an oil refinery catches fire in the West and crimps already tight gas supplies, California could see per-gallon prices jump to between $4 and $5 a gallon in a matter of weeks.

"If there is a problem at a big refinery, there is no limit to the price at the pump," Hamilton said. "The question is at what stage in the game does the nozzle get so hot that people drop it?"
---------------------------
Bob Shaw in Phx, Az Are Humans Smarter than Yeast?

The really pathetic thing is that Mr. Browne in the article (their lead example), sold his cabin in the woods at a loss, moved back to an apartment 12 miles from work, BUT KEPT THE SUV!!  <sarcasm>That San Diego is a real urban jungle...  Or maybe they have those blizzards in the winter for which you need four wheel drive.</sarcasm>
COuld be that he wanted to keep the SUV because of its high resale value (the GM model), or the converse in that he couldn't sell the damn thing.
In his defense, he did note that the truck is paid off. As the owner of a paid for car I know the temptation to drive the thing forever (within reason) is strong.

Besides, who wants to deal with car salesmen if you don't have to!?


Besides, I don't want to trade in my 17mpg vehicle for a 25mpg vehicle.  I'm waiting for the whole industry to ramp up towards 40mpg.  I want something sleek and sporty that still gets great mileage.  
There's some basic physics there.  Something sleek and sporty can get great mileage, by being small and light.  In fact, why not 100 mpg?

http://odograph.com/?p=332

Unfortunately, for the weight and cargo capacity of an American "midsize" I think things like the Prius are already pretty close to the edge.  I don't think there is that much more recoverable energy in the liquid fuel.  That's why the big trend is in plug-in hybrids and pulling energy from another source.

  Yesterday's SF Chronicle; front page article on the Tesla
=======

4 seconds
(Time from 0 to 60 mph)

Tesla Roadster: $89,000

4 seconds

Ferrari F430 Spider: $188,000

Under 5 seconds*

Subaru Impreza WRX STi: $32,995

5.4 seconds

Mercedes-Benz SL550: $94,800

5.4 seconds

BMW 750i sedan: $75,800

Under 9 seconds

Toyota Camry hybrid: $26,480

* Actual specification was 0 to 62 mph in 4.8 seconds

Sources: Tesla Motors;

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/08/09/MNGSSKDMBT1.DTL&hw=tesla&sn=001& amp;sc=1000

The best thing is that Tesla is working on a second model. a "4 door sporty sedan" for half the price of the roadster, and a third model should be even less expensive. All of them EVs.

http://www.treehugger.com/files/2006/08/tesla_motors_ev.php

Wow. I knew my Subie was fast, but who knew it was ranked up there with all those hot shots.  Oh, I forgot this is TOD, not massivehorsepower.org.

Very sharp looking.  That's exactly what I'm looking for.  Even 50 or 60mpg would be great.  I take the train to work, so I'm just looking for something fun for the weekends.

Someone needs to come out with something that's US Street legal.

Depending on what state you are in, you might get one, with varying degrees of difficulty.  Here's the main US import page:

http://www.uscaterham.com/

There are engine and suspension options.  It might be interesting to try for a fuel-sipping option.

Here in California a very limited number of custom cars are allowed licenses each year.  IMO it a fool's risk to buy the car and then hope for the license.  On the other hand, there are some cars on the market with licenses.  There are even some of the old original Lotus Super Sevens out there.

"Besides, I don't want to trade in my 17mpg vehicle for a 25mpg vehicle.  I'm waiting for the whole industry to ramp up towards 40mpg.  I want something sleek and sporty that still gets great mileage."

1988 Honda CRX Si, 105 horsepower, 5 speed, generally get 37mpg mixed usage 40+ extended highway...known to put cars with 3 times the horsepower to shame (tire smoke does not equal acceleration).  Acceleration in 1st and 2nd gears excellent, large dropoff into 3rd...handling excellent and predictable.  Fun factor 10.

They existed.  You may have to wait a while (if not forever) for something new.

In his defense, he did note that the truck is paid off. As the owner of a paid for car I know the temptation to drive the thing forever (within reason) is strong.

Think about it. Keeping a paid off vehicle, even if it consumes more gasoline, is a better deal than paying for a newer, higher mileage vehicle. We save the up-front expenses, keep a vehicle out of the scrap yard, reduce demand for more vehicles including all the resources consumed in making that new vehicle, and keep human mechanics in demand. Not bad really.

Combined with a little conservation keeping the paid for vehicle is better for us and the environment.

What do you think?

He could of course sell his truck and buy a 10 year old Corolla.  It's not necessarily a choice of keep old vehicle, or buy a brand new one.
This is why I'm actually considering selling the Prius and buying a 10 year old Corolla myself. Love the Prius, don't love the payments....... I'm really on the fence on this one though.

Or something cool like an old BMW - the old 3's get good mileage, and while they are a bit high maintenance, the user group around BMWs is amazing, I don't know of a better "support group" of users for any other car.

Any car will get better mileage if you featherfoot it, think in terms of "flow" like everyone used to before the automatic transmission.

Maybe something bio-diesel-able?  Alan does like those old diesel Mercedes.
I think about this quite a bit, and part of the appeal is the idea that biodiesel could be available in the event of gasoline shortages.  But I hate to let go of my newer, reliable gasoline car that gets 35-40 mpg on the highway. Maybe I'll figure it out one of these days.
Or, drive like you're moving a poorly packed crate of bone China, a terabyte server, or driving your grandma with severe osteoporosis. Don't drive like a bloodthirsty deranged Isreali fighter pilot! Which is to say, like the average urban commuter on a Friday afternoon.

I'm glad I get 25mpg despite using A/C and driving like the latter. (as much as the little engine allows) An mpg gauge would be great driver feedback to reduce those "fighter jock" tendencies that lots of people have. One change I'm doing is to move 5 miles closer to work, so I'll burn a fifth of gas less each way. I burn 3 fifth each way now, so I'll use only 2/3 of the fuel now.

Like the cover story, I switched to driving after being fed up with shoddy suburban transit. What'll be fun to watch is how long range commuters try to adapt. I already saw early signs of that demand destruction in my workplace.

We get 22 -25 mpg with a 6 cyl jeep cherokee 1995(4x4).  To me this is amazing....
Get your ScanGauge II, now with multiple backlight colors and an optional USB interface:
http://www.thinkgeek.com/gadgets/electronic/8426/
Keeping anything, especially a car, is almost always the better thing to do.  Thrift in all forms never hurts.  If you have an SUV but want lower gas prices you can get a bicycle for real short trips, reduce you driving to what is necessary and on the Interstate go 60, not 70, miles per hour.  70 is the speed limit; you can go slower, contrary to popular belief.  When all those savings are added up keeping a paid-for car would be the better deal.  Not to mention no car payments, lower insurance and you don't have to worry about dings and dents.  Used cars are also lower down on the must-steal list for thieves.  

I own a 1999 4 cylinder Mazda 626 (referred to by the dealer as a legacy car).  It gets a solid 30 miles to the gallon.  On the Interstate at 60 I average 35.  I am ready for peak oil; bring it on.

Agreed, keep it. Prius is only a step on the journey. My 1992 Mazda Protege has 102K on it, 33 mpg in town since I bought it new, twice driven East Coast <> Arizona. Fun car to drive too, if a bit road noisy, but I walk 2.5 miles each way to/from work or take free public transit bus.
Exactly. Trading the SUV for a new car just puts one more new car on the road. Someone else will buy the SUV (such a deal) and keep driving it. It's only a question of who, if anyone, gets to feel the guilt and which person has the bigger gas consumption. Only when the SUV goes to that big parking lot in the sky will there be an overall improvement.
This is a problem.  Human-oriented urban environments are all about compactness so that the necessities of life can be located within a walkable area and socialization, trade etc is facilitized.  Providing for storage of any vehicles, much less gargantuan ones is perhaps the most challenging thing about creating such environments.  The storage of an SUV including parking space and drive aisle widths etc take up about the same amount of space as a reasonably-sized efficiency appartment and costs (developer or municipality) about as much to provide.  
That's a great article, with lots of good stats.  The interesting tension is between people saying they are driving less, and the national numbers showing they are not.

Maybe those folks are passing on 3 mile runs to the market, but unable to change the big work (and social) commitments.

It's fascinating that US gas consumption is not declining yet. In Europe, price increases are proportionately much more modest, yet there is a measurable decline in motoring.

A tentative explanation :

  • In the US, there is a large segment of population who are affluent enough that a higher price does not discourage discretionary driving (in Europe, income disparities are much less, and even the relatively well-off feel the pinch sooner)
  • In the US, the less well-off have no alternative to driving. In Europe, a significant proportion of people can decide to leave the car at home and take the bus or train, even if it's inconvenient.
A manifestation of Jevon's Paradox?
Traditional "Jevon" needs prices to fall following conservation, and for consumption to re-expand.  Here we're at pretty high historical prices, and not seeing that pre-Jevon conservation.
I think we're seeing Jevon all right, it just takes time for the fleet to be replaced, and gas prices are really only affecting say the bottom 50% of the population in the US. A lot of people don't have the money to buy, which most often means finance, a thriftier car.
I hate to be picky but the dude's name was William Stanley JEVONS.  Even the Wiki is mislabelled...it's the Jevons' paradox, not the Jevon's paradox.  

http://en.wikipedia.org/wiki/William_Stanley_Jevons

Call me picky.  

Hey odo maybe it's like the overweight folks ..... "but I'm dieting" which actually means they're getting a diet soda with the latest Supersize Trough at Micky-D's.
As a result of paying living expense via borrowing against home "equity," a lot of people are going to be paying for expenses like gasoline and toilet paper for decades to come.
Lots of ARM horror stories in this article:

8/10/06 WSJ Article:  "Feeling the Pain of Rising Rates"

Excerpt:

Some California brokers say they are beginning to see a return of "short sales"--transactons in which the sales price isn't large enough to cover outstanding loans.  Patti Vaughan, an agent with Assist 2 Sell in Temecula, California, says in recent months she has begun to get calls from borrowers looking to unload houses they can no longer afford.  "They've upgraded their houses, put in a pool and bought themselves Hummers and BMW's," she says.  "Now they can't get it refinanced and they can't sell."

And now it begins.....

Glad I checked the "30 year fixed" box when I bought in '03


Yeah me too.  30 year fixed is a mortgage that lets you sleep at night.  

As it was I got hit with increases in my escrow account which amounted to a significant jump in my monthly payment this year.  I can't imagine if my payments were going up too.