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HenryTo
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 Posted: Tue Nov 15, 2005 12:24 pm Post subject: Peak Oil? |
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Dear all,
I would like to start a discussion/argument on the validity of the Peak Oil theorists on this board. One of my subscribers had asked me to do this - and I believe it will be a very well worthwhile discussion!
I know there has been a lot of literature written about this - including recent books - but one thing that I find lacking is the fact that many of the commentators talk about the industry in VERY BROAD terms. That is, economists who are working with questionable data - questionable because of the lack of transparency in the oil markets, not because it is their fault.
I feel that Matt Simmons had done a great job in his efforts to focus on the Saudi oil machine. He spent an entire book just writing about the Saudi oil industry, and makes a very good argument which discredits the Saudis' claims that they can ramp up to 15 mm barrels a day in a few years. In all likelihood, he argues, Saudi oil output has peaked or is near peaking. We need similar analyses for the Russian oil industry, the North Sea, Iranian, and Venezuelan oil production.
Going forward, this author is bullish on the price of oil in the long-run, as I believe oil demand growth in both China and India will surpass the ability of the world to pump more oil - given current constraints and the lack of new, impressive discoveries.
I would definitely like everyone to chime in.
Best,
Henry
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HenryTo
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rffrydr
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| Posted: Tue Oct 25, 2011 9:32 am Post subject: |
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Brent premium finally getting taken down.
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HenryTo
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| Posted: Tue Oct 25, 2011 12:15 am Post subject: |
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Update on Alberta's oil sands:
http://www.technologyreview.com/energy/38888/?nlid=nldly&nld=2011-10-25
| Quote: | Meanwhile, Nenniger is gearing up for tests of a solvent-only process that was invented in the 1970s by his father, who was vice president for process engineering at Hatch, Canada's second-largest engineering firm and N-Solv's majority shareholder. From a makeshift work space in Hatch's Calgary offices, Nenniger plots the technology's comeback: a $60 million pilot test is under way at Suncor Energy's Dover site northwest of Fort McMurray, the same place where the SAGD process was originally tested.
Nenniger estimates that eliminating the use of steam and lowering temperatures will save $9 on each barrel of bitumen. What's more, the solvent process can extract the best-quality bitumen, leaving more of the heaviest asphalt-like materials in the ground. That should make N-Solv's bitumen easier to refine, fetching producers an extra $15 for every barrel they ship. Nenniger also projects that the process will use 80 to 90 percent less energy per barrel of bitumen than SAGD, reducing carbon emissions accordingly.
N-Solv plans to drill observational wells at its pilot facility this winter, and injection and production wells should follow in the summer. Warm solvent could begin flowing as early as the fall of 2012, delivering production results by the following summer. Nenniger projects commercial-scale application in as little as five years. "Proving we're better than SAGD on a head-to-head basis will open up the entire oil-sands market," he says.
The question for oil-sands innovators is whether the financial risk of developing new types of in situ technologies will pay off. Cenovus needs a global oil price of just $45 to $50 per barrel to turn a profit on its Christina Lake investments; with prices now above $75 per barrel, it is making good money. In an era of cheap natural gas and pricey oil, Canada's bitumen producers will need an extra push before they commit billions of dollars to alternatives to mining and SAGD. Nenniger believes that corporate decision makers have little incentive to change under current economic conditions, where energy costs are low and tax-deductible, and carbon emissions are free. "You have a system that doesn't create market pull," he says.
Says Heather MacLean, a professor of engineering and public policy at the University of Toronto, "There has to be some type of a policy push ... to really motivate the most efficient production and reduction of greenhouse gases and other environmental impacts." What is needed, she says, is a price on carbon. Two years ago, Alberta introduced a carbon tax of $15 per ton, but that covers only a portion of industrial emissions, and even oil executives dismiss its impact on investments. "It's in the tens of cents per barrel," says Zieglgansberger. |
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rffrydr
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rffrydr
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| Posted: Wed Oct 19, 2011 7:51 am Post subject: |
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720,000 barrels of diesel this year alone sent out. As Mississippi barge/train develops out (ahead of the pipeline) look for this stat to continue to flatter the trade figures. Nothing is clearly obvious.
http://www.laedc.org/eedge/index.html#1
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rffrydr
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| Posted: Fri Oct 14, 2011 6:32 am Post subject: |
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Norway and now North Sea (the definition of North Sea BTW):
http://www.theengineer.co.uk/sectors/energy-and-environment/news/bp-and-partners-invest-almost-£10bn-in-oil-and-gas-projects/1010586.article
| Quote: | | ‘After some years of decline, we now see the potential to maintain our production from the North Sea at around 200,000–250,000 barrels of oil equivalent a day until 2030. And we are working on projects that will take production from some of our largest fields out towards 2050.’ |
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rffrydr
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| Posted: Fri Oct 07, 2011 6:31 am Post subject: |
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The Goldman line:
http://ftalphaville.ft.com/blog/2011/10/04/691986/goldman-on-whos-really-wagging-the-oil-market/
That this is a financial phenomenon, yes; that glut is readily absorbed by EEM flies in the face of the Chinese bust story so popular right now.
"Backwardization" used to be the normal state of things in crude. There was always a "liquidity premium" to crude because it is a vital commodity and comes out of a tinderbox. Now, we have a refinery problem, forcing what little is left to the super-sweet stuff (Libyia)--yet have no margins. It's infrastructure. Of course we can't build out there but are speedily putting in a piipeline from Cushing to Orleans. Already flowing on barges down the Mississippi balance is coming back. Rising Libyian production and Norway find will take pressure off next year. Russia keeps batting above weight--but at a high, $100 brent, price.
A little more "frisson" on chinese RE may serve to finally cap this madness and let us build out some refining capacity in jet fuel and heating oil--but that would be too rational.
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HenryTo
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rffrydr
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| Posted: Sat Oct 01, 2011 7:38 am Post subject: |
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Norway, given up for yesterday's news, finds 3BB field, as big a field as began it's oil economy in the 70's, of superior quality crude. Smack that Brent!
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nodoodahs
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| Posted: Tue Sep 20, 2011 12:21 pm Post subject: |
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I'll take the "UNDER" on that bet.
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HenryTo
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HenryTo
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HenryTo
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| Posted: Tue Aug 30, 2011 12:42 pm Post subject: |
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As usual, Stratfor puts in its insightful two cents.
| Quote: | Libya: A Premature Victory Celebration
The war in Libya is over. More precisely, governments and media have decided that the war is over, despite the fact that fighting continues. The unfulfilled expectation of this war has consistently been that Moammar Gadhafi would capitulate when faced with the forces arrayed against him, and that his own forces would abandon him as soon as they saw that the war was lost. What was being celebrated last week, with presidents, prime ministers and the media proclaiming the defeat of Gadhafi, will likely be true in due course. The fact that it is not yet true does not detract from the self-congratulations.
For example, Italian Foreign Minister Franco Frattini reported that only 5 percent of Libya is still under Gadhafi’s control. That seems like a trivial amount, save for this news from Italian newspaper La Stampa, which reported that “Tripoli is being cleaned up” neighborhood by neighborhood, street by street and home by home. Meanwhile, bombs from above are pounding Sirte, where, according to the French, Gadhafi has managed to arrive, although it is not known how. The strategically important town of Bali Walid — another possible hiding place and one of only two remaining exit routes to another Gadhafi stronghold in Sabha — is being encircled.
To put it differently, Gadhafi’s forces still retain military control of substantial areas. There is house-to-house fighting going on in Tripoli. There are multiple strongholds with sufficient defensive strength that forces cannot enter them without significant military preparation. Although Gadhafi’s actual location is unknown, his capture is the object of substantial military preparations, including NATO airstrikes, around Bali Walid, Sirte and Sabha. When Saddam Hussein was captured, he was hiding in a hole in the ground, alone and without an army. Gadhafi is still fighting and posing challenges. The war is not over.
It could be argued that while Gadhafi retains a coherent military force and significant territory, he no longer governs Libya. That is certainly true and significant, but it will become more significant when his enemies do take control of the levers of power. It is unreasonable to expect that they should be in a position to do so a few days after entering Tripoli and while fighting continues. But it does raise a critical question: whether the rebels have sufficient coherence to form an effective government or whether new rounds of fighting among Libyans can be expected even after Gadhafi’s forces cease functioning. To put it simply, Gadhafi appears to be on his way to defeat but he is not there yet, and the ability of his enemies to govern Libya is doubtful.
Immaculate Intervention
Given that the dying is far from over, it is interesting to consider why Barack Obama, Nicolas Sarkozy and David Cameron, the major players in this war, all declared last week that Gadhafi had fallen, implying an end to war, and why the media proclaimed the war’s end. To understand this, it is important to understand how surprising the course of the war was to these leaders. From the beginning, there was an expectation that NATO intervention, first with a no-fly zone, then with direct airstrikes on Gadhafi’s position, would lead to a rapid collapse of his government and its replacement with a democratic coalition in the east.
Two forces combined to lead to this conclusion. The first consisted of human-rights groups outside governments and factions in foreign ministries and the State Department who felt an intervention was necessary to stop the pending slaughter in Benghazi. This faction had a serious problem. The most effective way to quickly end a brutal regime was military intervention. However, having condemned the American invasion of Iraq, which was designed, at least in part, to get rid of a brutal regime, this faction found it difficult to justify rapid military intervention on the ground in Libya. Moral arguments require a degree of consistency.
In Europe, the doctrine of “soft power” has become a central doctrine. In the case of Libya, finding a path to soft power was difficult. Sanctions and lectures would probably not stop Gadhafi, but military action ran counter to soft power. What emerged was a doctrine of soft military power. Instituting a no-fly zone was a way to engage in military action without actually hurting anyone, except those Libyan pilots who took off. It satisfied the need to distinguish Libya from Iraq by not invading and occupying Libya but still putting crushing pressure on Gadhafi.
Of course, a no-fly zone proved ineffective and irrelevant, and the French began bombing Gadhafi’s forces the same day. Libyans on the ground were dying, but not British, French or American soldiers. While the no-fly zone was officially announced, this segue to an air campaign sort of emerged over time without a clear decision point. For human-rights activists, this kept them from addressing the concern that airstrikes always cause unintended deaths because they are never as accurate as one might like. For the governments, it allowed them to be seen as embarking upon what I have called an “immaculate intervention.”
The second force that liked this strategy was the various air forces involved. There is no question of the importance of air power in modern war, but there is a constant argument over whether the application of air power by itself can achieve desired political ends without the commitment of ground forces. For the air community, Libya was going to be the place where it could demonstrate its effectiveness in achieving such ends.
So the human-rights advocates could focus on the ends — protecting Libyan civilians in Benghazi — and pretend that they had not just advocated the commencement of a war that would itself leave many people dead. Political leaders could feel that they were not getting into a quagmire but simply undertaking a clean intervention. The air forces could demonstrate their utility in delivering desired political outcomes.
Why and How
The question of the underlying reason for the war should be addressed because stories are circulating that oil companies are competing for vast sums of money in Libya. These stories are all reasonable, in the sense that the real story remains difficult to fathom, and I sympathize with those who are trying to find a deep conspiracy to explain all of this. I would like to find one, too. The problem is that going to war for oil in Libya was unnecessary. Gadhafi loved selling oil, and if the governments involved told him quietly that they were going to blow him up if he didn’t make different arrangements on who got the oil revenues and what royalties he got to keep, Gadhafi would have made those arrangements. He was as cynical as they come, and he understood the subtle idea that shifting oil partners and giving up a lot of revenue was better than being blown up.
Indeed, there is no theory out there that explains this war by way of oil, simply because it was not necessary to actually to go war to get whatever concessions were wanted. So the story — protecting people in Benghazi from slaughter — is the only rational explanation for what followed, however hard it is to believe.
It must also be understood that given the nature of modern air warfare, NATO forces in small numbers had to be inserted on the ground from the beginning — actually, at least a few days before the beginning of the air campaign. Accurately identifying targets and taking them out with sufficient precision involves highly skilled special-operations teams guiding munitions to those targets. The fact that there have been relatively few friendly-fire accidents indicates that standard operational procedures have been in place.
These teams were probably joined by other special operators who trained — and in most cases informally led — indigenous forces in battle. There were ample reports in the early days of the war that special operations teams were on the ground conducting weapons training and organizing the fighters who opposed Gadhafi.
But there proved to be two problems with this approach. First, Gadhafi did not fold his tent and capitulate. He seemed singularly unimpressed by the force he was facing. Second, his troops turned out to be highly motivated and capable, at least compared to their opponents. Proof of this can be found in the fact that they did not surrender en masse, they did maintain a sufficient degree of unit coherence and — the final proof — they held out for six months and are still holding out. The view of human-rights groups that an isolated tyrant would break in the face of the international community, the view of political leaders that an isolated tyrant facing the might of NATO’s air forces would collapse in days, and the view of the air forces that air strikes would shatter resistance, all turned out to be false.
A War Prolonged
Part of this was due to a misunderstanding of the nature of Libyan politics. Gadhafi was a tyrant, but he was not completely isolated. He had enemies but he also had many supporters who benefitted from him or at least believed in his doctrines. There was also a general belief among ordinary government soldiers (some of whom are mercenaries from the south) that capitulation would lead to their slaughter, and the belief among government leaders that surrender meant trials in The Hague and terms in prison. The belief of the human-rights community in an International Criminal Court (ICC) trying Gadhafi and the men around him gives them no room for retreat, and men without room for retreat fight hard and to the end. There was no way to negotiate capitulation unless the U.N. Security Council itself publicly approved the deal. The winks and nods that got dictators to leave in the old days aren’t enough anymore. All countries that are party to the Rome Statute are required to turn a leader like Gadhafi over to the ICC for trial.
Therefore, unless the U.N. Security Council publicly strikes a deal with Gadhafi, which would be opposed by the human-rights community and would become ugly, Gadhafi will not give up — and neither will his troops. There were reports last week that some government soldiers had been executed. True or not, fair or not, that would not be a great motivator for surrender.
The war began with the public mission of protecting the people of Benghazi. This quickly morphed into a war to unseat Gadhafi. The problem was that between the ideological and the military aims, the forces dedicated to the war were insufficient to execute the mission. We do not know how many people were killed in the fighting in the past six months, but pursuing the war using soft military power in this way certainly prolonged the war and likely caused many deaths, both military and civilian.
After six months, NATO got tired, and we wound up with the assault on Tripoli. The assault appears to have consisted of three parts. The first was the insertion of NATO special operations troops (in the low hundreds, not thousands) who, guided by intelligence operatives in Tripoli, attacked and destabilized the government forces in the city. The second part was an information operation in which NATO made it appear that the battle was over. The bizarre incident in which Gadhafi’s son, Saif al Islam, announced as being captured only to show up in an SUV looking very un-captured, was part of this game. NATO wanted it to appear that the leadership had been reduced and Gadhafi’s forces broken to convince those same forces to capitulate. Saif al Islam’s appearance was designed to signal his troops that the war was still on.
Following the special operations strikes and the information operations, western rebels entered the city to great fanfare, including celebratory gunfire into the air. The world’s media chronicled the end of the war as the special operations teams melted away and the victorious rebels took the bows. It had taken six months, but it was over.
And then it became obvious that it wasn’t over. Five percent of Libya — an interesting calculation — was not liberated. Street fighting in Tripoli continued. Areas of the country were still under Gadhafi’s control. And Gadhafi himself was not where his enemies wanted him to be. The war went on.
A number of lessons emerge from all this. First, it is important to remember that Libya in itself may not be important to the world, but it matters to Libyans a great deal. Second, do not assume that tyrants lack support. Gadhafi didn’t govern Libya for 42 years without support. Third, do not assume that the amount of force you are prepared to provide is the amount of force needed. Fourth, eliminating the option of a negotiated end to the war by the means of international courts may be morally satisfying, but it causes wars to go on and casualties to mount. It is important to decide what is more important — to alleviate the suffering of people or to punish the guilty. Sometimes it is one or the other. Fifth, and most important, do not kid the world about wars being over. After George W. Bush flew onto an aircraft carrier that was emblazoned with a “mission accomplished” banner, the Iraq war became even more violent, and the damage to him was massive. Information operations may be useful in persuading opposing troops to surrender, but political credibility bleeds away when the war is declared over and the fighting goes on.
Gadhafi will likely fall in the end. NATO is more powerful then he is, and enough force will be bought to bear to bring him down. The question, of course, is whether there was another way to accomplish that with less cost and more yield. Leaving aside the war-for-oil theory, if the goal was to protect Benghazi and bring down Gadhafi, greater force or a negotiated exit with guarantees against trials in The Hague would likely have worked faster with less loss of life than the application of soft military power.
As the world contemplates the situation in Syria, this should be borne in mind. |
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rffrydr
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| Posted: Fri Aug 26, 2011 1:07 pm Post subject: |
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Yeah....and the hurricane hits Wall St. instead! After the earthquake in Washington might be more than wishes--call it a fantasy 
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