DrumBeat: January 11, 2008

ANALYSIS - Bush unlikely to pressure Saudis on oil

When he arrives in Riyadh on Monday, Bush would be well within his bounds to quiz the Saudis on how the de facto leaders of the OPEC cartel can tame oil prices that are an added blow to a U.S. economy tilting toward recession.

Saudi Arabia, the world's biggest oil exporter, produces about 9 million barrels per day and is in the midst of a major capacity boost aimed at relieving drum-tight global supply.

"Where are those 12.5 million barrels per day that their oil minister has been promising forever?" said Thomas Lippman, adjunct scholar at the Middle East Institute.

Surging oil prices fuel manufacturing inflation pressures in Canada

Factory prices and the cost of raw materials surged in November as the high cost of oil showed signs of filtering through to the general economy.

Statistics Canada reported Friday that prices charged by manufacturers for their goods rose 0.6 per cent in November after six straight monthly declines. Meanwhile, raw material costs jumped 3.4 per cent, boosted by steep increases in oil and coal prices which have only accelerated in recent weeks.

U.S.A.: Almost Gone

Oil remains a great concern as the price continues to hover around $100 per barrel. The Democrats blame the Republicans, sighting the fact that the cost of oil before Iraq and the cost of oil today has more than doubled.

But then, had you read my book you would have been prepared for oil to hit these levels and keep right on going. Or had you listened to Texas oil legend, T. Boone Pickens, you could have also picked up on the fact that there is limited oil in the world. Mr. Pickens stated that the world has reached peak oil and the demand continues to climb; it’s called supply and demand; not the Iraq war.

The future of oil? America's not in the driver's seat

The big driver on oil prices today is rising Asia's burgeoning demand. At the Cold War's end, Asia accounted for 10 percent of global oil demand. Today it gobbles up double that share. Before 2025, Asia will become the oil market's global demand center, dislodging North America.

So it's basically our blood, their oil.

A second big driver is that many key producers are themselves becoming significant consumers, shriveling their capacity for exports. Indonesia became a net importer years ago while Mexico, a huge supplier for the United States, will head down the same path unless it soon opens up its national oil company (NOC) to foreign direct investment.

Argentina to reopen diesel, gasoline exports

Argentina's government struck a deal with oil companies on Friday to reopen gasoline and diesel exports once domestic prices for the fuels are rolled back to Oct. 31 levels, a government source said.

State news agency Telam reported on Monday that Argentina had frozen exports of the fuels to boost dwindling supplies in the local market and stem rising costs.

Russia ready for greater foreign investment in oil and gas projects

Russia is ready to consider greater foreign participation in oil and gas projects, including on its continental shelf, a first deputy prime minister said on Friday.

Older Arctic sea ice replaced by young, thin ice, says study

A new study by University of Colorado at Boulder researchers indicates older, multi-year sea ice in the Arctic is giving way to younger, thinner ice, making it more susceptible to record summer sea-ice lows like the one that occurred in 2007.

The team used satellite data going back to 1982 to reconstruct past Arctic sea ice conditions, concluding there has been a nearly complete loss of the oldest, thickest ice and that 58 percent of the remaining perennial ice is thin and only 2-to-3 years old, said the lead study author, Research Professor James Maslanik of CU-Boulder's Colorado Center for Astrodynamics Research. In the mid-1980s, only 35 percent of the sea ice was that young and that thin according to the study, the first to quantify the magnitude of the Arctic sea ice retreat using data on the age of the ice and its thickness, he said.

"This thinner, younger ice makes the Arctic much more susceptible to rapid melt," Maslanik said. "Our concern is that if the Arctic continues to get kicked hard enough toward one physical state, it becomes increasingly difficult to reestablish the sea ice conditions of 20 or 30 years ago."

Peak Oil Passnotes: The Bears Are Back in Town

As we enter 2008, there has rarely been a time when the prospects for the oil price could be so apparently volatile. Just take some of the figures we have at our disposal today as reminders.

One year ago the Nymex price for a barrel of crude fell just a shade under $50 intra day. By the end of the year it was hitting $99 per barrel, doubling in value inside 12 months.

Even more underwhelming for economic progress is the far end of the futures curve – then years hence - where crude has stubbornly resisted falling back too far under $90 per barrel. We have inventories that have fallen around the world as very expensive oil is forsaken for just expensive oil.

BP starts L.A. refinery gasoline unit work - sources

BP Plc was beginning a massive overhaul on Thursday of the gasoline-producing unit at its Los Angeles-area refinery, according to sources familiar with refinery operations.

Up to 4,000 contract workers are expected to be employed in the two-month overhaul of the 103,000-barrel-per-day (bpd) gasoline-producing fluidic catalytic cracking (FCC) unit at the 265,000 bpd refinery in Carson, California, the sources said.

A BP representative declined to discuss operations at the Carson refinery.

Nigeria: Senate Urged to Enact Law On Casualisation

National Assembly has been asked to enact laws that would address what has been described as unfair labour practices by multi-national oil companies operating in Nigeria.

Russia to supply 50,000 tons of fuel oil to N.Korea Jan. 20-21

Russia will supply 50,000 tons of fuel oil to North Korea on January 20-21 in line with a six-nation deal to resolve the country's nuclear problem, a deputy foreign minister said on Friday.

North Dakota: Refinery Study Group Formed

Six Democratic state legislators and Agriculture Commissioner Roger Johnson have formed a task force to explore whether North Dakota should get into the oil-refining business.

Expanding North Dakota's refining capacity may help moderate prices for gasoline and diesel fuel, which are among the nation's highest, and assure a more regular supply, lawmakers said at a news conference Thursday.

Russian oil spill threatens drinking water

Russian volunteers on Friday scooped dead ducks out of a river outside Moscow polluted by an oil spill from a nearby power plant that is threatening to spread and contaminate drinking water.

Shoppers in China will have to pay for plastic bags

Shoppers in China will have to pay for plastic bags at supermarkets and other retail stores as part of a nationwide crackdown on the environmentally damaging items, the government has announced.

Ireland to ban low-efficiency light bulbs

Ireland is to ban the sale of traditional light bulbs from next year and promote the use of low-energy CFL bulbs, environment minister John Gormley said Thursday.

Australian gov't aims to ditch plastic bags by year end

Australia's government said Thursday it hoped to phase out the use of plastic bags from the nation's shopping centres by the end of the year.

Environment Minister Peter Garrett said billions of bags were being thrown away every year, causing pollution and harming native wildlife.

Ahead for Heating Oil Users: a Record-Shattering Winter

Penny Osborn never before needed help with the cost of heating, but the 57-year-old physician's assistant had been out of work most of last year recovering from cancer surgery. And as cold weather set in, she faced an $855 bill to fill up the oil tank of her Colfax, Iowa, home—a delivery that would last only half the winter and already cost more than she paid for heat all last season. Osborn was able to fuel up only with federal and state energy assistance, which defrayed about 60 percent of the cost of her first provision of oil.

Unfortunately, two days after that delivery—while Osborn and her 78-year-old mother, who shares her home, were visiting relatives on Thanksgiving Day—a thief siphoned her oil tank dry. "It rated right up there with getting the diagnosis of cancer," Osborn says of the discovery. With temperatures below freezing throughout December, she borrowed money from friends to buy enough oil until her doctors cleared her to work again. "My prayer is that I'll find work very shortly," Osborn says.

Mexico's Calderon Inaugurates Nitrogen Plant To Help Oil Production

Mexico's President Felipe Calderon inaugurated a new nitrogen injection plant on Thursday to help increase oil production in the country's southern region.

State oil firm Petroleos Mexicanos has seen oil output fall steadily since reaching a peak in 2004, and is turning to advanced techniques such as nitrogen injection to increase pressure in oil and natural gas reservoirs, which improves extraction rates.

Mexico: Thieves cause diesel pipeline spill

Thieves ruptured a pipeline that crosses the Gulf Coast state of Veracruz, spilling at least 79,000 gallons of diesel fuel Thursday and forcing the evacuation of at least 350 people.

...Fuel shot 25 feet into the air from the pipeline, according to residents, who told city officials that people who clearly were not Pemex workers had been extracting the fuel since Wednesday morning, Marquez said.

Hindustan May Buy Fuels From Essar, Mangalore, Reducing Imports

Sourcing fuel from Essar, India's newest refiner, will lower imports to Asia's third-largest oil consumer, cutting margins for gasoline and diesel in the region. An auto boom in the world's fastest growing major economy after China is boosting fuel demand and prompting Hindustan Petroleum, Essar and Reliance Industries Ltd. to add refineries.

``Fuel demand in India will rise as more smaller, cheaper cars start rolling out,'' said Rohit Ahuja, analyst, at Mumbai- based J.M. Financial Ask Securities Ltd. ``That's encouraging new refineries to come up and existing ones to expand to meet demand.''

PTT set to cut retail fuel prices if global prices continue falling

Thailand's top energy giant PTT Plc says it is ready to cut local retail oil prices next week if global oil prices continue to fall.

Chaiwat Churitthi, senior executive vice president of the PTT Oil Business Group, said concerns over crude prices in the world market had now eased since oil reserves had increased and cold weather in Europe had lessened.

Uganda: Fuel Dealers Arrested

THE Police in Masaka yesterday arrested a filling station manager and two pump attendants for taking advantage of the fuel shortage in the country to charge exorbitant prices, reports Ali Mambule.

Southern China faces power crisis again in 2008

Southern China will again face serious power shortages in 2008, a problem that has plagued the booming economic region for years,the media reported on Friday.

Jefferson Bus Lines cutting back on long trips

Long-distance bus riders in northwest Minnesota/northeast North Dakota will soon find themselves limited to traveling on certain days to reach their destinations. Jefferson Lines, which currently provides two daily bus service routes - northern and southern - from Bemidi, Crookston, Grand Forks and towns in between, announced Tuesday that it will cut these back by nearly half.

"This was a difficult decision for the company," Wendy Cymbaluk, Jefferson Lines director of marketing and sales, said in a news release. "Increased operating costs from soaring insurance and fuel costs make it necessary for us to look at every mile we operate."

Honeywell helps open fast-food gas stations in China

China Petroleum & Chemical Corp., McDonald's Corp. and Honeywell International Inc. opened China's first gasoline station that will provide fast food and car services, tapping the nation's rising vehicle usage.

Ukraine: UkrGazEnergo warns of gas supply disruption

Ukraine’s largest natural gas supplier UkrGaz-Energo warned on Thursday that gas supplies in 2008 are at risk of disruption following the government’s unexpected move to cancel the company’s supply license.

Oil, not China, sends trade deficit higher

The U.S. trade deficit in November surged to the highest level in 14 months, reflecting record foreign crude oil prices. The deficit with China declined slightly while the weak dollar boosted exports to another record high.

New generation of nuclear reactors promises ‘greener and safer’ energy

Energy companies building the next generation of nuclear power stations will choose between four models, the manufacturers of which have already applied to have their designs approved for use in Britain.

UK: Why 36 is the magic number for nuclear

Your electricity bill will soar as the power supply becomes greener and more radioactive, in line with government policy. The proof lies in a single number buried in the White Paper on Nuclear Power, published yesterday.

The number is 36 and it will soon represent the meaning of life for the forseeable future. It is not the price per kilowatt hour of electricity, nor is it the billions to be spent on nuclear waste management or even the cost of printing the 192-page White Paper. It is the cost of a tonne of carbon traded on Europe’s Emissions Trading System (ETS) as forecast by the Government.

Galveston biodiesel plant to spend on repairs and claims

The owners of a biodiesel plant in Galveston said Thursday they will spend $15 million to upgrade the facility and settle legal claims against it after Chevron Corp. "abandoned" the project last year.

Bush To Push Saudi On Oil In Mideast Talks?

The last time U.S. President George Bush met face-to-face with Saudi Arabia's King Abdullah, crude oil prices were nearly half their current price and Saudi oil output was 5% higher than it is now.

Sen. Lugar: ‘Energy, Ideas’ New Drivers to Avert Current Oil Crisis

Confounding critics who allege that nothing of global intellectual value can emerge from the Hoosier state, the senior senator from Indiana on Jan. 4 hurled down the gauntlet against carbon and fossil fuel addiction.

U.S. Sen. Richard Lugar made his scheduled remarks less than 48 hours after the price of oil topped the $100-a-barrel mark. This was an ironic milestone if one considers that Lugar first called for energy reform years ago when oil went at the now-impossible-to-believe $20 a barrel.

Leftists without logic

The utmost in economic idiocy comes from that shifty and oh so brilliant liberal writer, Thomas Freidman, columnist for The New York Times. His solution to the energy crisis is to add on a federal gas tax of a dollar or two per gallon. His brilliancy shines through because as he explains it, we could kill two birds with the same bullet. This tax would decrease the demand for oil and the taxes collected could be used to increase our badly needed social programs. Gee! Why didn’t we think of this before? Like so many lefties and environmentalists he is pleased that gasoline is now selling at $3.25 per gallon and the solution will be when our prices in this country reach 9 to 10 dollars a gallon. This now occurs in numerous European and socialist countries where gas is heavily taxed and in some instances the government owns and operates the entire oil industry ala Hillary Clinton.

Fuel shortages in northern Iran sparks riots

Fuel shortages in sub-zero temperature in northern province of Mazandaran sparks angry riots.

Residents of Qaemshahr gathered outside the governorates office building yesterday to protest against the government's inaction to resolve fuel shortages after a gas supply cut off over the past two weeks. Lack of any move by the authorities to deal with the crisis while the country is going through one of its coldest winters angered protesters. They attacked the building and set fire to the offices.

The protest which started at around 14:00 local time yesterday went on till early hours of evening as the crowd grew in size spreading to other parts of the town.

Similar protests were reported in other towns and cities in the province including Sari and Babol. In these protests the crowds were shouting anti-government slogans damning the regime for its incompetence with record oil revenue. They were calling the leaders of the regime "a bunch of thieves and murderers" and ridiculing Ahmadinejad by saying, "instead of fighting the whole world you should resolve our basic requirements."

Persian Gulf Oil-Tanker Rates May Decline on Canceled Bookings

The cost of shipping Middle East crude to Asia, the world's busiest market for supertankers, may fall for a 12th day on signs oil companies are canceling bookings and waiting for the market to drop.

Companies provisionally hire ships subject to port approvals and other conditions. It can take between one day and one week for an oil company to commit irrevocably to a ship rental and it costs nothing to cancel a conditional booking.

Economist predicts $1.50 a litre for gasoline

"What we don't appreciate is that the oil-sands delays (we've seen) are not a unique story. It's happening in the very fields where the world is expecting to get its future supply," Rubin told the Toronto Star.

"Don't think of today's prices as a spike. Don't think of them as a temporary aberration. Think of them as the beginning of a new era."

The Real World: Oil at $100

Is $100 oil a cause to celebrate? The answer is, yes -- in the short term, and no -- in the long term. The answer also depends on who you are and where you sit.

Many oil exporting Middle Eastern government officials may think that the oil bonanza is here to stay. However, oil revenue is notoriously cyclical, with ups and downs wreaking havoc in the national budgetary process.

Petrodollars -- or petro-euros these days -- also have a nasty habit of causing a national addiction, crowding out non-oil sectors and making countries, business, and individuals dependent on one commodity only. This is hardly a prescription for a healthy economic model.

$1000 Gold? $100 Oil? One May Glitter While The Other Turns to Sludge

Oil has been the other great commodity story of 2007. In fact as 2008 opens for business the fastest-growing bet in the oil market these days is that the price of crude will double to $200 a barrel by the end of the year. According to Bloomberg, “Options to buy oil for $200 on the New York Mercantile Exchange rose 10-fold in the past two months to 5,533 contracts, a record increase for any similar period. These contracts – which are the cheapest way to speculate in energy markets - appreciated 36 percent since early December as crude futures reached a record $100.09 on Jan. 3.” But are oil traders getting ahead of themselves? The demand for crude has been predicated on two key drivers – geo-political risk and global growth.

Gazprom sees taking 10-15 pct of Irish gas market in first 5 years of ops

Russia's Gazprom said it plans to take around 10-15 pct of Ireland's gas market in its first five years of operations in the country, the Irish Independent reported.

Jon Feingold, managing director of UK-based subsidiary Gazprom Marketing and Trading Retail, told the newspaper that the company would target high-end commercial clients and power stations.

Turkey to help US operate, transport Iraqi oil

Turkey will help the United States to operate and transport neighbouring Iraq's oil as part of its drive to become an energy hub, Turkish Energy Minister Hilmi Guler told CNN Türk on Friday.

Secrets of Shell and Rolls-Royce come under attack from China’s spies

Shell, an Anglo-Dutch group, had to deal with a spying ring in Houston, Texas, security sources told The Times. Chinese nationals working for the company were preyed upon by state-backed operatives hoping to obtain confidential pricing information for its operations in Africa, the sources said.

UK: Going off the rails

Rather than fining train companies for poor service over the new year, the government should be putting money into rail improvement.

Any Other Bright Ideas?

For every eager adopter, though, there are plenty of holdouts. “I want to use fluorescents,” said Kath Brandon, a health care recruiter in Denver. “I try to live as green as possible. I telecommute, I recycle, I try to group all my errands together so I don’t have to needlessly burn extra gas.”

But in her experience, compact fluorescents make her house look “dark, cloudy and cavelike.” The bulbs do not emit a “warm, comforting, inviting feeling,” she said. “Your home is your sanctuary,” she said. “It’s where you live and recharge, and it nurtures you.”

Digital Tools Help Users Save Energy, Study Finds

Giving people the means to closely monitor and adjust their electricity use lowers their monthly bills and could significantly reduce the need to build new power plants, according to a yearlong government study.

Raymond J. Learsy: President Bush in Saudi Land. Questions to Ask While Holding King Abdullah's Hand

Your Highness, my people at our Energy Department and my good friend Matt Simmons are somewhat confused. They tell me they know so little about your true production capabilities. That you have let it be known that Saudi Arabia holds 260 billion barrels of crude oil reserves. Then in March of last year the head of reservoir management at Saudi Aramco, estimated the kingdom's reserves were almost three times greater, being closer to 716 billion barrels and possibly as great as a trillion (1,000,000,000,000) barrels. You see, we feel strongly that the lack of transparency in oil markets and the poor quality of information available generally, and especially from you as the most important producer in the world, contribute enormously to volatility and uncertainties. Therefore we would be especially grateful were you to lift the veil of secrecy and share data on your output and reserves setting an example for oil producers everywhere. Could we count on your cooperation in this matter as it is a key to our economic planning and that of so many others?

Who's Afraid of Mideast Money?

The men who manage the region's sovereign wealth funds are using the billions from Persian Gulf oil revenues to change the face of global finance.

Tar Sands vs. Clean Water: Eating the Earth for Cars

The tar sands production center in northern Alberta in Canada is one of the clearest signs that the easy-to-get oil is on the wane. Tar sands are a low grade hydrocarbon deposit that requires enormous energy input to process and convert it into something resembling petroleum.

The High Costs of Doing Nothing, Part II

In November 2006, California voters rejected Proposition 87, a ballot initiative to raise the oil industry’s taxes by $4 billion for research into renewable energy.

Four months before the ballot, a survey by the Public Policy Institute of California found that 61% of likely voters favored the idea, including 51% of Republicans.

What changed between the survey and the vote? The oil industry pumped more than $60 million into a campaign to defeat the measure.

Home energy use gets a 'smackdown' on reality TV

Even an 'überenvironmentalist' family found it could save a lot more when a competition was at stake.

Analyst calls oil at $100/barrel "pretty cheap"

Crude oil at $100 a barrel would still be "pretty cheap" because global oil demand shows no signs of abating and new energy sources are in short supply, a prominent U.S. oil analyst said on Thursday.

Matt Simmons, founder of Houston-based Simmons and Co International, dismissed the idea that a looming U.S. recession will tame crude oil prices, which have tumbled since they peaked above $100 a barrel on January 3.

"Demand is far more durable than anyone ever thought," Simmons told Reuters in an interview. "We're on an insatiable growth curve."

Oil tanker on fire at Nigeria port, supplies not hit

An oil tanker burst into flames at Nigeria’s Port Harcourt on Friday after two loud explosions were heard, police and security sources said.

The tanker was most likely discharging refined fuel at the city’s main port when it burst into flames, oil industry sources said, adding that supplies of crude oil from the world’s eighth largest exporter were not affected.

Nigerian militants claim responsibility for port explosion

Militants said Friday they remotely detonated an explosive device placed on a docked ship, and authorities said two people were injured in the fiery incident in restive southern Nigeria.

Oil price upswings go beyond fundamentals

The fundamentals are no more in control of the market. New factors have emerged in the process — much beyond the grip of the traditional market players — impacting heavily on the global oil prices.

And the transformation has been rapid — taking place before our eyes — over less than a decade.

Arizona: Food Bank center looks to end need for help

Andrews said the need for soup kitchens, emergency food boxes and other such Band-Aid remedies to hunger can be reduced by having a community-based food system with community gardens, shared kitchens, and education about such food-preservation techniques as canning and freezing.

"The new era we're entering is a more ecological approach to food, so it's more a theme of sustainability in light of climate change and peak oil and the economic realities that those things are driving," said Andrews.

Investing in a Resource-Constrained World (Part I)

We are living in a resource constrained world, due to rapid depletion of many of the none-renewable natural resources, like oil, coal, and metal mineral resources. As the main stream media wake up to the Peak Oil reality, I believe it is important to keep the reality of a resource constrained world in our mind, when making investment decisions. In this article I want to talk about precious metals, including gold, silver, platinum and palladium, the rare metal tellurium and selenium, coal mines, agriculture, sugar, and fertilizers.

Warming forces Iditarod changes

Citing a warming climate and sprawling development, officials with the Iditarod Trail Sled Dog Race said Wednesday they were implementing permanent logistical changes that in recent years have become the norm for the March event.

Not sure if this very interesting news about EESTOR had been posted:


Lockheed Martin Signs Agreement with EEStor

Are you confident that their technology will offer a greater amount of energy and power density than batteries?
Yes, and at a fraction of the cost.

Do their caps hold 10x the energy at 1/10th the weight of a lead acid battery?

Do they have something that they’ve tested that you’ve seen which makes you want to work with them?
We haven’t personally tested their prototypes yet. Its something that we’ll work on together this year

Looks like 'hype', as usual. Nothing to see, yet! ... move along!

Actually they have been extremely hype free - and if anything secretive. I have been trying to get more information about them on the web, but it is very hard, other than maybe a couple of press releases and a patent. It is interesting that this came not from them, but the defense company.

Yes, hype by Lockheed Martin Missiles and Fire Control for some bizarre reason (you would have thought they would keep details like that secret?)... not hype by EEstor - as you say, secretive people, I wonder why? - but I can guess.

Why so defensive Xeroid? EEstor hasn't asked for a cent from the public or government, was funded by a highly respected group of investors and is now getting defense department contracts for its product. It seemed pretty obvious to me from the article that the Lockeheed Martin folks have seen the device work they just haven't been allowed to take one for themselves yet.

Oh! ... let's hope they have a viable product, available to the whole world, in the huge quantities required ... but, as usual for adequate alternatives to oil, they are not available yet (even to the military - who usually get stuff years before Joe Public.)

We have an urgent need for something like this - BTW ultra-capacitors are not new technology, but for any real capacity they are NOT low cost at present (low cost is the AIM of their R&D efforts and you shouldn't assume that they will actually be low cost when/if they finally hit the market (that doesn't matter for military applications maybe?) - there are many applications that need large amounts of energy in a short period of time (an example is intermittently used photocopiers that have to have their fuser rolls hot is one area I know quite a bit about.)

Military contractors have a history of throwing money (they have a lot of it, thank you Mr. taxpayer!)at a technology even if there is less than a fifty/fifty chance of it working. Witness the huge amount of funds thrown at the “Star Wars” program. Most of these experimental programs show no results. An article for Technology Review, published by MIT, show there are a lot of scientists who are very skeptical this new battery will work. The comments are interesting, while the scientists cite papers and explain why they don’t think the Eestore device is viable, the other comments throw around platitudes and wishfull thinking as to why it will. Maybe a new way to measure the acceptance of the reality peak oil - peak platitudes.


There is an obvious military use for these high voltage devices. As noted in the interview:

......In the situation where you are trying to store energy, transport it without discharge obviously thats very attractive in the utility grid load leveling (situation). If your talking about powering for example a high energy weapon that requires a short burst of energy a capacitor is a great approach to do that....

...We are basically working with them exclusively and in the homeland security and defense department’s markets...

One of the big problems with laser weapons is the high energy requirements over a short period of time. If these ultra capacitors are as good as described, think of IR lasers mounted on Humvees. There was a story about such a scenario while back. The IR laser is invisible and the comment went something like "the bad guy was standing in a group talking with his buddies and suddenly his head exploded". Such systems would also be of use in airborne applications, including lasers to intercept incoming missiles. They would be used for delivering a series of rapid pulses, then could be recharged over a few minutes from lower power sources, such as an APU. Then too, there are the potential orbital applications...

E. Swanson

Why so defensive Xeroid? EEstor hasn't asked for a cent from the public or government, was funded by a highly respected group of investors and is now getting defense department contracts for its product.

I wouldn't be too sure about who funded all this research originally. There is a theory that it came out of weapons research in the first place.


I'd love to be proven wrong on this, but to me it has all the signs of investor fraud. The product capabilities probably violate the laws of physics. But hey those capabilities, are just what anyone who knows what the specs for energy storage mean would kill for this.

Yes, ultracapitors are really amazing devices. But in the real world they have limits. It would be great to combine UC with LiIon for all sorts of plugin technology, but the current cost is prohibitive.

Heh, enemy, you qualified that nicely.

"The product capabilities probably violate the laws of physics."

Sure it does !

So what's so surprising about that ?

This makes all the sense in the world to me.

"The new boss is same as the old boss."

They military-industrial complex is continuing to strengthen it's position for a post FF transition.

Goal: Present vested interests remain vested.

Technology like this can provide a "step change" in some applications. Here is one:

Years ago, the railroads used to run their own power lines along the track, to power equipment such as signals, switches, interlockings, and road crossing barriers. THey did this because they were the only ones around needing power. As rural powerlines became ubiquitous, the railroads switched and started buying power from local utilities.

Today, the railroads are dependent on utility power for the bulk of their operations. THey have large battery banks at critical installations, and can survive limited duration power outages, but any extended outage slows them way down, since they fall back on manual procedures. (Engineers hand-cranking switches, going 15 miles per hour instead of 70+ MPH).

This technology is attractive not so much because of the capacity (that too) but because it can be rapidly charged. You can envisage a maintenance vehicle with onboard generator and storage driving down the track, and "topping off" these capacitors once or twice a day as needed. Getting rid of the power lines, dependency on (future) intermittent utility power, and vandalism/theft of powerlines is a huge deal.

Conventional batteries would take too long, requiring the maintenance vehicle to block the track excessively.

Bring it on.


These things are 3500 volt systems (according to wikipedia). You need 4180v AC to charge them. Nobody's going to use them in personal cars or in remote RR locations. Quite possibly for load leveling and power factor adjustment though.

Getting a high charging voltage from a low-voltage high current source is a known technology. :).

Besides, the high voltage will discourage theft!

It's known tech for large stationary facilities, true. However, if people are worried about ammonia, compressed air, or liquid hydrogen tanks in cars they're not going to be happy with what happens when a 3500v capacitor discharges to ground after a crash. The passengers better be wearing their rubber suits.

Then what interest does Zenn have in them?


They have the rights to makes ultra compact cars using their technology, their stock jumped 25% on this weeks news.

That would be so cool. One circuit fault and you could be driving around in a giant bug zapper. A true multipurpose vehicle.



The real point of the super-capacitor tech is, it's a great solution for practical IR laser weapons. No trajectory to compensate for, no more "doping" the wind, point and shoot. No smoke/dust/discharge to show the enemy where the IR pulse that just exploded the little kid's head came from. Easy to maintain/repair. Practical IR weapons frankly have it all over the venerable rifle/pistol. Even an efficiency much greater than alternate methods of killing large numbers of people like calling in "spooky" and getting 'em with the chain gun.

A US population raised on video games + IR weapons means a practical way to eliminate large amounts of the enemy without spending huge amounts of money and destroying valuable infrastructure.

So, you can expect these supercaps to be boosted "it's for better cars, um, coffee machines, er, whatever" lol.

Regular or extra crispy? I've thought that that giant laser airplane we are building might be the way to assassinate somebody who has too many collateral casualties around him.

These things are 3500 volt systems (according to wikipedia). You need 4180v AC to charge them. Nobody's going to use them in personal cars or in remote RR locations. Quite possibly for load leveling and power factor adjustment though.

The High working voltage is also a problem for energy extraction. Since the capacitor stores a charge as a DC voltage you need very high voltage switching gear to step it down. ie Very high voltage Mosfets IGBT.

Then the step down transformer needs to be very well insulated, which can be difficult with High Frequency transformers (need HF to reduce weight as size of the xformer). Then there is the problem of failure. HV DC will arc across a very large gap. If one of the transistors in the H-Bridge fails, it will be difficult to break the flow of current. You can't use ordinary breakers to break HV DC current flows. If the breaker fails, look out for a big bang.

We'll never see vehicles using these capacitors, the risks are too great for use in general transportation. Perhaps for Grid storage or UPS systems. I doubt these will be cheap.

Typical multi layer condenser. Can hold a lot of charge, but is way, way more expensive then lead acid battery.

Actually wrong, did you read anything about EEstor? The whole point of the product is that it can be done at a fraction of the cost.

There is nothing that shows that it will be at lower cost. There is simply a statement that it will be, but the drawing is a typical multilayer capacitor. Why in the world would it be cheaper? Absolutely not! Tell me what exactly will make it cheaper to manufacture?

The essence of this article is captured in one sentence: "They have an agreement to produce caps for Zenn electric cars but to date have not shown any prototypes. This has led some to suspect EEStor as not having the technology they report."

What follows is marketing to keep company alive. I've seen few start-ups many years back and they always talked about some unreachable idealistic goal as something that they have already. That's the only way that they could get money to continue going. Exuberant optimism. They also always portray some preliminary discussions with a larger company as a vote of confidence. The owner of the company has nothing to lose. In start-ups perception is everything, reality has no value.

That's my experience of R&D also (and not just in startups!) - BTW nanosolar also matches that spec by the looks of it!

I agree with you. There is nothing in the link that says anything about their technology, and you are correct that the drawing is just a generic drawing of a capacitor. There is more to a storage media that the amount of energy that can be put into it, including the rates of charge and discharge (both short and long term), and how deeply the thing can be routinely discharged. This quote leads me to believe there is a limitation:

How does Lockheed Martin feel about ultracaps and storage versus li-ion or NiMh batteries? Lockheed Martin doesn’t have a bias. One way or another its really just a function of what does the customer want. For certain applications being able to provide pulse power is really really important, in another its not so much really pulse power but continuous power. If you talk to the Army they are really interested in hybridized solutions. Suffice it to say that EEStor’s technology is a piece of some of these systems solutions that we come up with. We are a system integrator so we look at the EEStor technology as a building block or a tool in a toolbox to provide the best solutions for the soldier.

But don't worry, technology MUST save us - it must it must it must! Somewhere in all these happy horseshit developments is going to be the silver bullet that means we'll all be able to continue driveing personal automobiles - which is after all the only thing that really matters.

Somewhere in all these happy horseshit developments is going to be the silver bullet that means we'll all be able to continue driveing personal automobiles - which is after all the only thing that really matters.

That's the idea buddy. :) Don't worry though, feel free to move to the middle of the country get yourself some land and live off the land and be happy or move to a really poor country they don't have too many cars there. :) Either way I believe that future tech will bring a cleaner more advanced society for all (that want it).

Best hopes for silver bullets and driving personal automobiles.

So far the majority of the oil wealth that we have used went to transportation, much of it frivolous and wasteful. We even replaced our previous transportation infrastructure and reconfigured our communities to make personal automobiles a requirement and use as much as possible. Now the premise is that we should replace our automobile fleet, increase our power generation capacity (most of which will be coal), and rebuild out T&D infrastructure so that we can all continue to use personal automobiles. What does it take to get people to understand the incredible cost the automobile has exacted from all of us?

There most certainly will be EVs, and some may use caps for storage (it's a minor detail), but we cannot simply switch to EVs and have the car-culture go on as it has. If we cannot envision a world where humans are not wholly dependent on automobiles, then there really is no way to avoid the worst-case scenarios.

The claim:

way, way more expensive then lead acid battery.

The claim by the historically wrong "theantidoomer"
Actually wrong,

O Rly? Let see - given how you've been wrong so many times before - lets see if the trend continues.

I can go to many different stores and spend under $100 and get a lead acid battery.

I can NOT go to any store and buy these 'way way less expensive' eestore caps.

Historically, if something can not be bought it is considered expensive.

But go ahead and show the wal-mart web page, the battery plus, the .... web page that has the way, way cheaper EEstore caps you claim are cheaper.

(edit - your lack of response shows how, once again, you were incorrect theantidoomer. And how people who question the shipping status of EEstore are FAR more reasonable.)

Historically, if something can not be bought it is considered expensive.

Being unable to be bought makes them unobtainable, not expensive. ;) In the same vein, I believe EEstor's products are made from military-grade Unobtanium, as opposed to them being vapourware (as others have opined).

Traditionally more expensive, you mean. With EEStor we don't yet know so don't claim otherwise. If you research EEStor you will discover NO patents related to ultracapacitors. What you will find instead is several patents related to the manufacture of ultracapacitors.

I remain neutral about EEStor but the breakthrough they appear to be seeking is in scalability of manufacturing and in cost control. There's no way to evaluate that until they actuall get into production.

I agree. I remain neutral...They aren't hyping, sorta like Nanosolar. All private money. So I let them be, no reason to beat up on them.

However, in our internal process of searching for advanced battery technology here, we found that there claims are pretty hard to swallow.

The energy density is still very low...which may explain some of there early claims to be working on a battery-ultra cap hybrid. It isn't likely that we will see vehicles running on Ultra-caps only any time soon.

But, this raises the question as to the point of the ultracaps, in a Lead acid environment, it could provide high current spike capability, possibly NiMH(possibly), but for more current Li Ion (or derivatives) it appears to be unnecessary as many of these systems can spike in excess of 1000 amps instaneous.

But, I wish them nothing but success in the most genuine sense. Improving battery technologies can only help our transitions (in my best anti-doom face).

I haven't been here for a while, but having some experience with capacitors and capacitor discharge systems, I have to say that you guys are ....., even though you don't want to know the truth, you spew off a bunch of anecdotes about capacitors and continue on and on without any resolution to the discussion.
Truth is, the patents on manufacturing process for EESTORE ARE the most important bit, since the process is the product in this case. Supercapacity is achieved through science, whether using extra thin, gold layers, or through better dielectric materials for higher voltage, or by increasing the surface area (or effective surface area) of the capacitor. This latter is probably the process of EESTORE, in combination with a higher voltage dielectric. The first gen of gold caps were limited to low voltage because of the weight of dielectric and conducting layer materials. If EESTORE has come up with a better dielectric process to combine with a carbon/carbon black type material, then we will be looking at products that can make chemical batteries as we know them to be obsolete. Especially when considering the weight factor. (nanobots constructing monoatomic filament towers of carbon, covered with single layers of defect-free, monatomic layers of glass and carbon?)

In light of safety factors: in an accident, the capacitor might have some kind of frangible dielectric that shatters (see above), causing an internal discharge so that exposure to high voltages is minimized.

There is a lot of potential for this if they do it right.

Your favorite Luddite,


I think you are right...there is a lot of potential (mind the pun).

But, the fact is that they haven't lifted the skirt enough to understand if their approach is anything more than research.

There are a substantial amount of applications for existing and new ultracapacitors, but long range vehicles is a reach with was available now, and with what they have 'stated' about their approach.

Best Hopes they sitting on Mr. Fusion, I certainly would love one.

There is a lot of potential

There is the potential that Peak energy won't be an issue. But for that to happen, man's level of expectation of "what is normal" will have to change.

eestore has had years to show a product and the claims fly in the face of known capacitor knowledge, hence the skeptics

Just like claims that 'peak oil is no problem' when man *LIKES* lights, heat, cars, eating meat, and the history of violence to obtain materials.

On balance, more hype. Maybe worse. Their patent is here: 7,033,406.

This reads like a fairly typical process for making multilayer ceramic capacitors (MLCC), which have been around for years. Their wrinkle might be low porosity or other properties of the ceramic permitting higher breakdown voltage than usual, but the patent is well enough written to avoid really disclosing what they propose to accomplish, or how, except to raise the breakdown voltage. It hasn't been necessary to submit working models for years, so patents are sometimes written in a way that allows a patent holder who did nothing to sue the actual inventor years later when the patented item finally gets invented for real.

The money quote is found about 2/5 of the way down:

Stored energy E=CV.sup.2/2, Formula 1, as indicated in F. Sears et al., "Capacitance-Properties of Dielectrics", University Physics, Addison-Wesley Publishing Company, Inc.: Dec. 1957: pp 468-486, where C is the capacitance, V is the voltage across the EESU terminals, and E is the stored energy.

That formula has been known for much more than a century, and OTOH there are far more recent textbooks. So I can't imagine how or why they or their patent lawyer settled on a textbook from 1957, the last hurrah of vacuum tubes.

Not that it matters, this formula does not apply to barium titanate and other "high K" ferroelectric materials at high energy density. Ordinary high-K MLCCs that one buys at a distributor already show very substantial saturation effects when operated at rated voltage - that is, the capacitance at rated voltage decreases as much as 80% below the value marked on the reel. Making the dielectric less porous - so that it doesn't punch or arc through - is not going to solve this problem; it may even aggravate it slightly. It will allow the voltage to be raised, causing even more of the capacitance to disappear, reducing the energy storage to a small fraction of what investors might have concluded from the formula.

Because the process described in the patent is fairly conventional, it would still seem to involve spraying every one of hundreds or thousands of layers. This is not cheap. A conventional MLCC storing a few hundredths of a joule at a couple of kilovolts and occupying a 2220 (220x200 mils) package might cost fifty cents each in large quantities. Storing 52kWH, 187 million joules, might cost somewhere north of $3 billion with an array of such things. That's one hell of an expensive substitute for a gas tank. Before we can sell it, we need to cut the cost by a factor of around one million. Nothing in the patent seems to suggest a factor exceeding a few hundred even if "E=CV.sup.2/2" (energy is one half capacitance times square of voltage) and every other optimistic assumption proved true.

It's pretty clear to me, then, why they need a military sugar daddy. If they can accomplish production miracles and fabricate a 52kWH/180MJ pulse capacitor array for a million bucks instead of 3 billion, they'll have a pulse-laser or electromagnetic pulse generator (EMP) energy storage unit that the DARPA types will salivate over.

In the meantime, IMO, nothing here, move on. There appears to be a reason why, for the time being, they have no functional website, no engineering samples, no product specs, no nothing, just secretive whispers, shhhh, don't look behind the curtain.

J'accuse! theantidoomer

    Again you come here like the saviour, offering your anecdotes and hype as the antidote to the doom we luddites and others seem to be predicting. And yet again we have explained why there is nothing to your over zealous optimism.

    Time again we the scientists and engineers who actually do this stuff, have tried to explain to you the limitations of technology - like my outburst here:
    and yet you persist on this madness.

I have been wondering what goes on in your head, what motivates you, and then I read this:

theantidoomer: feel free to move to the middle of the country get yourself some land and live off the land and be happy or move to a really poor country they don't have too many cars there. :) Either way I believe that future tech will bring a cleaner more advanced society for all (that want it).

    So essentially your position is a dichotomy because you do not believe we should give up anything. A classic 'have-the-cake-and-eat-it'-syndrome familiar to anyone with children.

    Not only is your position naive in the extreme by ignoring how many things we already 'give up' everyday with the real compromises we make in engineering, manufacturing and economics: the opportunity cost of every decision, the allocation of limited resources, the law of entropy. But you insist on placing immediate comfort over safe future, the familiar conveniences over the real costs and demands they require.

    You lack the ability of moderating your expectation to match reality. And in order to justify your position to yourself, and deny the absurdity of your position, you are having to deal with superficial anecdotes.

    This truly is the level of thinking for a five year old. However in my opinion you are more likely just a shill.

But for the benefit of others I would like to say a few words.

    I work at the border of science and engineering, one foot in each. For people like us, problems like PO and GW, and I might add the inevitable collapse of our unsustainable monetary system, leave us with only two choices, in depth analysis, or total ignorance. Most of my colleagues choose the latter, understandably as they have invested their lifetimes into their careers and research and locked themselves into a certain lifestyle. Personally, if I'm having to perform objective analysis of problems in my work, its hard to do the opposite in my daily life. But for others it seems they can detach their personal lives from the side of the brain they use at work, and live the common irrational way of life, at least for now.

    For the non-engineers and -scientists it's much easier. For them its all about religion. All they see is the cornucopia of technology at the shop window - the perception being that its all at least linear, if not exponential: everything getting faster, bigger/smaller, better every year, with no limits in sight. And why would they see any limits - they have no concept of what is a limit - energy, space and time - laws of physics are there for the theoretical physicists to 'break'. And even less so, they have no idea of the compromises done in engineering or the law of diminishing returns (engineering IS ABOUT making compromises!).

    If you point out to them some shortage of a particular resource, they'll just state we'll figure out a way of making more from less, forever (forever meaning often their lifetimes). Similarly, as they have no idea how the monetary system works, they believe absolutely that money is no object in the way of finding and applying any number of solutions to all our problems.

    Finally we come to the technocopians - the advocates for the status quo. Their motives stem from the various fears and delusions they have got from being confronted by greens and extremists on the other side (which I don't particularly like either). Or they have simply analysed PO far enough to have found something personally unacceptable to their wish of what the future should be. Hence they desperately defend their hopeless position with what ever means: assured rhetoric, logical fallacies, outright denial. TOD is a tough place for them since people here know their engineering and math. Here you cannot just bluff people with numerology or tech-jargon.

    The reason I like TOD and have stuck around for now, is that here you have lots of oridinary people different walks of life, making extraoridinary efford in analysing the situation objectively and holistically. People who are not distracted by hype or narrow interests. And people who can see hope in the future without having to resort to irrationalities or denial. Having to let go of our current way of life is seen as an opportunities for a better, healthier and happier existance for man. In that, I think we are the true optimists.

Hmmm... interesting response but I'm a tad confused as to which post you're responding to...

Having to let go of our current way of life is seen as an opportunities for a better, healthier and happier existance for man.

You need to write more here.

You seem to imply that all scientists agree with you.
They don't.
Not a very scientific or rational way of arguing, is it?
FYI as eminent a scientist as Fred Hoyle felt that very substantial growth was possible and desirable.
He felt that civilisation was a one-shot chance, as all the high quality resources of fossil fuel would be exhausted at the first attempt, that notions of moving to a low-energy existence were nonsense, and that ample power could be provided for many millions or indeed billions of years by the use of nuclear energy.
And you could still have a car! - electric powered of course!

Yes, lets listen to Fred Hoyle on how to handle civilization's infrastructure. A man who believed in steady state because he didn't like the big bang. A man who argued against chemical evolution with the same arguments used by the intelligent design people.

The man is an astronomer, not an engineer or research scientist. Theoretical physicists are nice when locked up in their basements. I haven't seen many around our lab for years now - rarely do they come up here with stuff we can even try to apply in the real world. The bone is clean and dry.

But really, that’s just unfair ad hominem-

As I explained, apart from the conscious denial, I would expect any real scientist to agree with my point. What one should really be looking for is engineering thinking. Ask yourself, has this person thought about what he's proposing. Cause if he has, then he would present his case a lot less arrogantly, and a lot more humbly. Engineer's are humble people - cause the real world makes you humble...

PO isn't 'solved' by producing more electricity as has been pointed out here on TOD many times. However, ignoring that for now, just replacing every heat engine that uses fossil fuels with electric motors and building distribution and storage systems for the electricity is of course technologically possible. So is building a Mall of America on the moon. Its possible but not feasible or practical. We no longer have the time or the resources for such an undertaking. And many would argue that it would not be worth it.

People who have good ideas, people who impress me, start by giving me a breakdown of a large set of problems associated with the idea and how they propose to deal with each of them. That is what tells you that they've done their homework. People who impress me even more, start by explaining an alternative point of view, which makes the original problem obsolete.

Defining the problem of PO/GW as trying to keep everything the same by applying techno fixes is the most popular point of view since it requires no life style changes. This POW maintains that our current life style is the only true subjective choice fixed by history and vehemently rejects that one could find objective scientific reasons for better alternatives...

Such as those given by medicine, sociology, psychology, anthropology, ecology... etc. - all basically agreeing that humans are happier and healthier when everything is simpler and smaller, community based, human centred, organic, in tune with natural systems. And the situation with PO/GW seems to be forcing us towards this end. Now whether we choose to go along with or fight it should be a trivial choice.

People who desperately want to spend every last resource we have to keep their insane personal automobiles and their unhealthy suburbian life style, whatever the human costs, and the risks to our continuing existence, are simply beyond my understanding.

I just find it weird beyond belief that you should feel that you should feel able to speak for 'real engineers'
In any such a heterogenous body of people there is likely to be a diversity of opinion, and your strictures on what you feel to be an unhealthy lifestyle and so on whilst certainly fashionable are to do with politics, not technology or engineering, which presumably is the field upon which most engineers would feel especially qualified to speak.
As an engineer you should also be aware that most problems of resources and so on can usually be solved if you have ample energy, and that the energy flux at the earth's surface is ample to support many billions of people in conditions of comfort and at a standard of living of which you so disapprove - and I am betting that you have not actually had to live at the low enerrgy use standard of living of which you so heartily approve.
Amoung those engineers who would vigorously disagree with you on the possibility and practicality of a better life are many from areas such as China and India, where society is still sufficiently close to the levels of energy use and so on for there to be a better realisation that it has little to recommend it, and for millions is just unending drudgery.
Of course, this does not apply to delettante 'good life' fanciers, who like Thoreau tend to confuse a holiday with real life.
Here is one plan which could certainly provide energy enough for the lifestyle of which you so disapprove:
I happen to think that you could do as well or better than this a lot cheaper and easier, but this serves to demonstrate that there is no real reason to suffer the drastic drop in living standards of which you seem so enamoured.
The other bit of news is that billions in places like India are going to press right ahead with improving their standard of living, entirely ignoring the vapourings of thee comfortably circumstanced.

your strictures on what you feel to be an unhealthy lifestyle and so on whilst certainly fashionable are to do with politics, not technology or engineering

If medicine and public health are part of technology (I think they are), then his comments are factually true, not "what you feel to be an unhealthy lifestyle".

We have an obesity epidemic in the USA (from vague memory, obesity has tripled since 1980 and morbid obesity has more than quadrupled since 1980). This obesity epidemic, as surely as increased smoking increase lung cancer, will increase diabetes, strokes and cardiovascular disease in general. Walkable communities (such as NYC) have NOT shown the same rates of increase in obesity as the general population.

And the social isolation of Suburbia also leads to mental health disorders, which appear to be also increasing as well.

I am betting that you have not actually had to live at the low enerrgy use standard of living of which you so heartily approve.

In my particular case, you would be wrong. I hope to use 3,000 kWh in my apartment this year (no natural gas) and 60 gallons of diesel in my car in 2008 (assuming no hurricane evacs this fall). In 2009 or so, I hope to build a very efficient garage apartment that uses substantially less energy. If I add solar PV, it could be a net energy producer.

Best Hopes,


I took the comments about 'unhealthy lifestyle' and so on to be more to do with the moral environment than physical health issues, and to do with the disapproving attitude from the chap who I was referring to than to do with physical health - I don't think the attitude would have changed even if someone used their income to work out at the gym.
As regards people's lifestyle choices, you attempting to go low-energy is fine.
However, I would point out that you own a car, and a comfortable house - your definition of low use would in fact be the envy of most people in the world.
What gets my back up is people who don't think that others in the third world are entitled to the same comforts, and get hyper-environmental instead of striving to promote legislation and business systems which would allow them to progress.
There is nothing romantic about poverty, in energy terms or in any other terms.
If we go easy on the fossil fuel input, there is plenty of energy around for everyone to live at a Western standard, and we don't need to keep people in poverty however picturesque.
Of course, we can't have everyone living at the standard Al Gore does, that would be absurd.
But then I don't really think he is too keen to have others at that level - privacy whilst you are jetting off to attend climate change conferences is nice.

Ransu drops the blade on the shilldozer and pushes both levers forward - nicely done :-)

Oh, and by the way, what I said means we're stuck with batteries for now, probably unless someone invents both a miracle nanotube capacitor and an affordable and practical means to produce the necessary materials by the megaton. I say stuck because EESTOR's patent claims an energy density (by weight) somewhat better than present-day Li-ion:

The components are configured into a multilayer array with the use of a solder-bump technique as the enabling technology so as to provide a parallel configuration of components that has the capability to store electrical energy in the range of 52 kWh. The total weight of an EESU with this range of electrical energy storage is about 336 pounds.

For comparison to this ridiculously optimistic scenario, 52 kWH is about 8 or 9 pounds worth of gasoline or diesel; throw in a few more pounds for the gas tank, and the EESU is still around 30 times heavier.

Oh, and the solder-bump thing gives me the willies for mounting large ceramic components into modules for vehicles stored and/or used outdoors. Think metal fatigue and subsequent cracking and breakage in the bumps - this type of packaging tends to pop off circuit boards subjected to large temperature fluctuations, especially if lead is legally disallowed in the solder. Any risk of internal disintegration is not a good thing in a module (EESU) storing this much energy at 3500 volts. It's enough energy to raise 336 pounds of ceramic and metal to a very high temperature, and it will not simply disappear into thin air, leaving a harmless room-temperature pile of fragments and powder, if the module arcs over.

I have been reviewing BP Stat Review 2006 and 2007

World C+C+oil sands, shale,+NGL’s Production (2005 to 2006) increased by 410 K Brl’s per day.
World C+C+oil sands, shale,+NGL’s + product Exports (2005 to 2006) increased by 2,655 K Brl’s per day.

That tends to tell me that net available crude + product available to exporting countries decreased by 2,245 K Brl’s per day.

What will BP Stat Review 2008 show? Is this the reason for the discontent in many exporting countries? The common folks are being shorted of product.

Oil tanker bursts into flames.

Happens all the time.

Wonder how big it was.

Now the fire has to be put out, the ship towed away and the
docking loading area repaired.

Meantime, no exports from here.

Actually, the tanker was discharging refined imports. I guess that means the export land model working in reverse.

I missed that. The implications?

Has to be trade off.

Hi all,

Next week I am going to attend a committee meeting of the 'All Party Parliamentary Group on Peak Oil and Gas' in the UK Houses of Parliament.


The guest speaker will be Peter Davies (BP's Special Economic Adviser); he will present BP's view on peak oil, to be followed by questions and answers.

The committee Chairman has already warned that any questioners will not be allowed to 'tear Peter Davies apart' ... oh dear! ... never mind!

Do any of you have suggestions for a pertinent question that I might ask him? Thanks.

I sure the other folks here can help with "pertinent"questions{giggle}most of mine would be "inpertinent"

Hello Xeroid,

"Beyond Petroleum" makes very progressive commercials. They seem to deal with the topic of post-peak oil in a very subtle - yet non-threatening - way.

Question(s): Are they willing to offer assistance/expertise to communities that would like to plan for smooth transitions into a variety of possible low-energy futures. Are any such programs in the works? Are they willing to advertize the availablity of such plans/programs?

Using some simple mathematical models, some analysts have pointed out that the world in 2005 was at about the same stage of depletion at which the North Sea peaked in 1999.

With virtually no restrictions on drilling and with the best available technology used in oil fields managed by private companies, the oil industry has been unable to reverse the ongoing decline in North Sea oil production.

Why should we expect the oil industry to be able to reverse the ongoing decline in world crude oil production, relative to 2005 (based on EIA crude oil data).

I've a feeling that the next EIA report will show a new production record, the preliminary data is certainly showing such, (see http://netoilexports.blogspot.com/2008/01/new-crude-oil-production-recor...). If indeed it does, I think a sanity check of the various producers actual output would be in order, there certainly doesn't appear to be a glut of oil on the market at the moment. Of course it could just be that it is being totally overwhelmed by the ELM effect...

Regardless of what the final fourth quarter data show, I suspect that 2007 will still show a small decline in world crude oil production--but in any case overall Lower 48 production was pretty much flat in 1971 and 1972, after peaking in 1970.

Rounding off the nearest 0.1 mbpd, the initial Texas data were as follows (peak in 1972):

1972: 3.5 mbpd
1973: 3.4
1974: 3.4

And the 2007 to date data suggest the net export decline by the top five will be on the order of one mbpd relative to 2006 (total liquds).

The EIA's International Petroleum Monthly published Jan 11th, has a figure of 74,124 mb/d for crude oil in October 2007. This is month #4 above 74 mb/d if not revised later. Earlier months were May 2005, December 2005 and July 2006.
Even IF increased November and December figures were as quoted in the above link, the average for 2007 would be 73,439 mb/d, still lower than the 2005 average of 73,807. And earlier published IEA data do not show any increased production in November. And whether the UAE rebound will statistically happen anyway is a big question as the EIA crude statistics for August - October actually show increasing production for UAE.

I think the smartest move all of the foodbanks,and emergency relief .orgs is to promote community based ag in there respective areas.This start makes more sense than the current system...which has way too much hit or miss,feast or famine built in.

Local agriculture, overall a good thing, and to be promoted, something might be done along the lines you suggest, but ...

Feeding the poor (undernourished, malnourished, etc.) is, in a rich country like Switz, not difficult, although of what is done is so ‘under the radar’, circumventing usual practice, laws, and most particularly trade etc. agreements. Eg. supermarkets give leftover food to charity rather than destroying it; shops without licenses sell ‘discount’ food at half price, you have to be a card holder to enter, etc.

The nub is rather employment and pay - getting the poor to feed themselves, not as an anti-freeloader sentiment, but because having an underclass that is so vulnerable, is repugnant to me and makes no sense socially or politically to just stick to pragmatics leaving ethics in the bin. Having food banks and similar tackle such issues as ‘local’ agri seems beyond their scope, and leaves the poor out - there is nothing they themselves can do to affect food production/transport/etc. except look enthusiastic for photo-ops, grinning extras, pleasing PC greens.

To the global: FAO maps show that South America has been doing well foodwise while Africa, with its fast growing population and low crop yield..is sinking in calorie intake. Not stop news.


Many have related this state of affairs to US interference, control, or lack of it. While the cat is away, the mice will play .. Geo-politics, trad style. Others confusedly invoke the ‘livestock revolution’ - change in diet to milk, dairy, meat, which is uneven and related to energy. Yet others address systemic issues, capitalism which ‘automatically’ leads to increasing differences. The health profs. likes to stress that infectious diseases (eg Aids) affect food production by killing workers. Etc. That is all mainstream stuff, and leaves water, soil erosion, compaction, pollution, in the shade. Actually...in the blinding sunlight. Only transport and its costs has captured media attention. Cooking methods are not discussed. Only saying its all desperately complex.

bit long heh..

Nozette you sure do things strangely over there....

Grocery stores giving surplus food to the poor? Stores selling food at 1/2 price to those with a welfare card???

In the US "dumpster diving" is illegal, lefty-liberal health food stores have been known to prosecute people for taking discarded food from their dumpsters. Most dumpsters are locked these days.

As a good American I am all for throwing all the people in prison we possibly can, but under certain "repeat offender" programs in the US people have gone to prison for life for stealing a cookie or donut. As a good American I have to say this is GOOD! Very good! But it *is* very different from how things are done in say, Switzerland, apparently.

Fleam, as someone who lives outside the Great American Republic, I must say, you are a true patriot. You extol the virtues of the U.S.A. in such a way, that GOOD citizen you are, you will never again have to worry about nasty foreigners crashing at the gate yearning to "breath free".

Lady Liberty has done her job. Outsiders will know that scrounging is no longer acceptable behaviour.

I hear those wonderful words from the musical Oliver Twist, "Food Glorious Food", and think, the conditions of Dicken's London are forever immortalized in the American dream.

Must be part of the great inheritance received early at the knee of the motherland, the British Empire. Yes... brings me great comfort :-)

Martí taught us that "all of the world's glory fits in a kernel of corn". Many times have I said and repeated this phrase, which carries in eleven words a veritable school of ethics.

Fidel Castro speech 12-2008

Our community garden does just this. About half the plots are dedicated for production for food bank clients. Students from a local college volunteer the labor to plant and tend the plots, then the clients are given vouchers entitling them to harvest from the food bank plots.

sounds good..

Call to Tap Oil Reserve Is Rebuffed

WASHINGTON -- Energy Secretary Samuel Bodman rebuffed calls from Congress to release heating oil from the Northeast heating-oil reserve, saying it would be an "unnecessary market intervention" and leave the region "vulnerable to a true supply shortage" this winter.

Behind the WSJ paywall, but you can get in through Google News.

I've never been able to get into the WSJ via Google News, I assume they just allow it for Americans?

No, people in other countries tell me they can get in through Google News. Not through Google, through Google News. Search Google News on the title, author, or other key phrase, and when you find the right article, click on it.

Learsy is a bright man. His list of the dysfunctions in our relationships with the Saudis is extraordinary.

Soon, he will have to admit the reality of peak oil.

The Biz Week piece on six Gulf sovereign wealth funds is stunning -- $1.7 trillion in assets and counting. The $180 billion in profit on these investments amounted to more than half the total $315 billion that these six Gulf states earned from oil and gas. The money quote from an investment banker: Soon "they will be the industry. We will be working for them."

When you add on the funds from Russia, Kazakhstan and Venezuela, these funds are buying up pieces of Western companies from Texas to Hong Kong and changing the finance world.

Steve LeVine, author
The Oil and the Glory

They need to make the change in what they do - soon the oil train is going to start slowing down.

The oil train may be slowing down, but the oil wealth train is just gearing up. As the quantity of oil decreases, its value increases. And every indication I have is that the value increases faster than the quantity decreases.

The oil rich countries have a massive cash cow on their hands. They may have squandered the resource in the 80's and 90's, but they are accumulating wealth and power at an unprecedented rate now.

Accumulation of funds is no guarantee of sustainable wealth. The funds are worth little if they cannot be recirculated. The fund managers have to buy US, European and other assets.

Unfortunately for everybody, including the fundholders, little of this money appears to be flowing into the transitional industries the post-peak hydrocarbon world requires.

Interesting angle. With debt relief coming from oil rich countries, what are the chances of those investments going towards curtailing US oil consumption.

Slim and none - and Slim is about to get out of town

Hello Skylar,

"What are the chances of those investments going towards curtailing US oil consumption?"

IMO, the trillion$$ from Sovereign Wealth Funds [SWFs] have a very good chance of rapidly curtailing our 5% of global pop. burning 25% of global consumption.

Recall the TOD link yesterday whereby KSA plans to import their food and shutdown their homegrown grain agro-industry. They would collapse faster than Zimbabwe's agro-cliff if KSA did not have FFs--I am sure the Saudi Princes have carefully considered the tremendous national security risks in this strategy.

But, by buying all the stock in NPK, pesticide, herbicide, and seed industries, or a controlling interest--they can complete the 'NPK hen & eggs' control strategy I talked about in earlier posts. Remember that our highly concentrated American job specialization is entirely dependent upon our ability to generate food surpluses.

Then imagine a farmer not being able to get non-organic NPK, or tractor diesel, or the other agro-chem essentials, at all, unless he signs a contract pledging that some % of his harvest will be shipped back to KSA. Expect Mercs, hired by KSA, to deliver the NPK and diesel as required, but they will make sure you apply the nutrients and 'cides to the soil [not diverted to the black market]. Once this is done--nobody will bother to sift the soil trying to steal the now diluted NPK, or wipe the plant leaves for the applied 'cides.

At harvest time: the Mercs make sure the required % of bushels are headed offshore, then you are free to sell the rest. This farmer should make a nice profit because he is highly mechanized and the cheap NPK should make him the low cost producer. According to the recent Stuart Staniford keypost: expect lots of bushels to be diverted to ethanol and biodiesel to keep the elite happy-motoring.

Compare to a farmer who refuses to grow crops for foreign SWF export. With no cheap NPK, 'cides, and diesel: plummeting yields, Liebig Minimums, more prone to drought damage because the wells can't pump the irrigation water, and lots and lots of hard manual labor moving massive tonnages of organic manures to the farm. This farmer will really have to bust his ass to be successful because he will locked into being a high cost producer. He will be a free man, but consider his lifestyle very arduous compared to the farmer growing for SWFs. Animal manures are generally lower in NPK unless they are fed nutrient fortified forage or feed supplements. The diminishing returns scenario as usual.

The skyrocketing food prices will help force more Americans to start gardening, thus driving up NPK prices [and the SWF stockholders' profits even faster], making this entire, cascading blowback process move even faster. The rising urban and suburban demand for compost and manures will make it even harder for the farmer who wishes to be free and organic. Pretty quickly we could have 60-75% of the US labor force involved in relocalized permaculture if NPK is severely restricted to certain people. Don't forget that P & K are mined in very few locations [AND IS DEPLETING ANYWAY!}, therefore is highly susceptible to financial and/or military control.

Okay, just another 'wild & crazy' posting by me, or does it have some merit? Notice that there is no violence or thefts in the above paragraphs--just 'Business as Usual'.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Not so wild and crazy - I would not end grain independence unless I got something just as valuable in return or something just as valuable to fall back on.

Let see if we can dance.

"Okay, just another 'wild & crazy' posting by me, or does it have some merit?"

Hi Bob

I very much enjoy your posts, but yes this is a bit "wild & crazy"

Was it a Supreme Court Justice that said, "the Constitution is not a suicide pact?"

Food security is national security and won't be allowed to be compromised in the same way Unocal and the Ports sales were preempted.

Your point regarding Stuart's fermenting the food supply and given the ff inputs & the net energy loser status of corn ethanol, oil consumption would still not
be curtailed.

They're still getting an ounce of gold for ten barrels of oil. The rest is just numbers.

Yea, but it had been 8.5:1. Oil is losing it's value fast. I expect soon oil will soar in dollars.

We've been talking about this in "discredited"
websites for at least 6 months now.

where we are:


China still roars ahead. If we get a global contraction, it will hit China but it will absolutely hammer Japan. And Japan knows this which is why, despite the brave talk, they are filled with great fear. They know they can't keep things going by being honest or following the promises of the Plaza Accords to open Fortress Japan to world trade. Instead, they hope the lure of free money will stop other nations from demanding Japan change. And China's rulers are ready for a downturn. What happens in great downturns when the ruling empire that runs the Seven Seas with a navy that is scared of a few speed boats?

Well, knowing the ruling empire is rotten to the core and unable to function very well, most rising empires destroy the old, rotting empires. Japan can't do this but Russia and China can. The only thing preventing this is nuclear bombs in the US. We will use them.

So Russia and China will gingerly disarm us or in a more hilarious move, simply insure we go bankrupt much faster than they lose authority. In this case, they have a great chance of winning.


Countrywide avoids bankruptcy as BofA pays $4 billion (in stock) for a $1 company, probably so they could avoid losing billions more

The US learned from the UK Northern Rock debacle and avoided a massive bank run by orchestrating BofA's $4 billion all-stock takeover of lowly Countrywide and its epitome of executive corruption and greed, Angelo Mozilo.

Now ask yourselves, why would BofA pay $1 for a company that would have gone bankrupt if they hadn't? True, it's at over 80% off vs. its high, but still why pay billions for a company worth nothing (at best)?


Maybe because if Countrywide went bankrupt, it would have cost BofA more than $4 billion?

Lets see, BofA trades stock with Countrywide to acquire Countrywide. Where does the BofA stock come from? Well, they can simply issue new stock. In short, BofA doesn't actually transfer any dollars from whatever accounts they may have. Isn't that a bit like the Federal Reserve "printing" money?

E. Swanson

Presumably, BofA believes they can get clear title to some of those sliced and diced mortgages. Or maybe they just sell the whole works to KSA, who become our new landlord as well as energy supplier.

Better learn your manners: bow, scrape, curtsy. Can you say "your majesty" without choking?

The day "Your Majesty" escapes my lips is when said majesty is dead on the floor. I shall serve NO King, Queen, or Prince. If I ever serve a Princess, it shall likely be a daughter of mine. :P

Yeah, but at least I'm not one of the 50% of the population that will have to wear a veil.

Yes yes, 390, and they'll give you a governorship when they win.... keep on dreaming.

Black Dog, it is not that simple and it is not the same as "just printing money". Bank of America could issue new stock if they got SEC approval. The stock could then be sold and the money used to buy Countrywide. This way the value of outstanding stock would not be diluted because the new assets gained would offset the extra shares issued. But it is very hard to get SEC approval for this type of acquisition so therefore this is not how it is usually done.

What usually happens is a "stock swap". Countrywide stockholders will be given so many shares of B of A in exchange for their Countrywide stock. This will not be a new stock issue! The stock will come from the companies reserves or will be bought on the open market with either cash reserves or a bond issue.

Publically owned companies are simply not allowed to dilute the value of its outstanding stock by willy-nilly issuing new stock. If they wish to raise money they do not have they can issue bonds. But a bond is a debt instrument. That is, it is borrowed money that must be paid back.

Ron Patterson

Many (most?) companies have a reserve of unissued stock that has already been approved by the shareholders & SEC. Sometimes it comes from stock buy-back programs. Sometimes it is shares they have just never issued.

Regardless, it still dilutes the number of shares outstanding. If I were a BoA shareholder, I'd be thinking about a class action lawsuit. Buying the initial stake in Countrywide was some serious stupidity. Buying the whole company when it is on the verge of backruptcy is called "throwing good money after bad", and it is even more stupid.

BoA analogy: "I bought a lot in a subdivision in Florida, but it turned out to be swampland. So I bought the whole subdivision."

If you buy the whole subdivision you can bulldoze a levee around it and pump out the water. Does get you some return on your investment.

What happens in great downturns when the ruling empire that runs the Seven Seas with a navy that is scared of a few speed boats?

Pretty clearly, the empire isn't afraid of a few speed boats. It's looking to start a war.

Thank you mcgowanmc for posting this link. It's a good one.

We've been talking about this in "discredited"
websites for at least 6 months now.

where we are:



If you read the reports they clearly say that possibly the buyout will be completed at the end of 3Q. All sorts of things can happen between now and then.

The FED most definitely has a interest in seeing the deal happen, they don't want the 50B the home loan bank gave CFC disappear at once (much easier to write down a few B at the time as consolidation costs), but it remains to be seen whether too many stinking dead bodies, financially speaking, are found during discovery. And then the BAC stockholders have to go along with it.

Right now it just was a massive insider trading op that killed the shorts. Massive trading volume half hour before the announcement.

BofA is also buying C'wides losses equivalent to about 270 Million each year in tax offsets for 5 years and then, if C'wides losses exceed abt 1.3 Billion, BofA reaps further tax-offsets with no limit on C'wide losses. Joe Taxpayer must make up the shortfall in tax receipts to the treasury.

Say! Who writes the laws? Wage-earner types?

Can somebody please explain to me why US banks are going to foreign contries to get money. The US Treasury and Da Fed are supposed to be the end all fix all for these guys, right? I mean the Treasury is supposed to print money per the constitution and the Fed is the "lender of last resort" according to its mission statement.

Well evidently this isn't so. What gives?

Nate (or anyone else) As an old trader, what is the likelihood that the guy who made the legendary $100/barrel trade quietly bought up some sell positions at $95-96? He'd be ahead now. Just wondering.

you dont 'buy up' sell positions. Its possible he shorted alot of contracts right after he bought the one at $100, but who knows? The market did trade $100.1 the next day. Often times people gun for these even levels (not in oil, but in liquid stocks) and they become self fulfilling prophecy but when they are hit there is a long vs short imbalance and the market corrects. All this would only impact very short term in oil. The intermediate and long term will be dominated by fundamental supply and demand.


Yesterday, you were wondering about the Canadian dollar, which is recently trading below the peak it hit last fall. The C$ is taking another hit today, down to .98, on the basis of a negative jobs report in Canada. Canada, as I'm sure you know, is more than oil, wheat and metals. The forestry sector is hurting very badly; Canada has been a huge exporter of lumber and pulp and paper. Automobile and automobile parts exports are hurting as well. In general, our export-oriented manufacturing sector is taking a beating from the tremendous rise in our currency vis-a-vis the greenback in the last several years. It was not so long ago that the C$ was at .63 to the U.S.$. And of course, the largest market for Canadian goods is on the road to perdition.

Thanks. but in the end they export energy, which most other currencies dont (except Norway) (can you tell Im long CD$?...:)

I hope you haven't gone too long given the importance of natural gas, and for that matter conventional crude, in the energy export mix.

In Britain we have had this problem for 30 years. North Sea oil has made the pound in to a petrocurrency that has priced out our non oil trade. UK manufacturing output is the same as it was in the early 1970's, before the oil was extracted. Now it is going we are having to let the Pound decline to reblance our economy. Our manufacturing is so weak now it will not be easy.

Leanan, would you see if you can link the latest USDA Crop Report?

I can't. It was released this AM.

But the Grain Complex is soaring.


Got it:

I always have liked the Delta Farm Press.


Corn and soy are at or near limit up.

July08 wheat lmt up.

Must've been some Report.

Can't wait to read it.

USDA statistics site

Jan 11 grain stock report

Corn stored in all positions on December 1, 2007 totaled
10.3 billion bushels, up 15 percent from December 1, 2006.
Soybeans stored in all positions on December 1, 2007 totaled
2.33 billion bushels, down 14 percent from December 1, 2006.
All wheat stored in all positions on December 1, 2007 totaled
1.13 billion bushels, down 14 percent from a year ago.

The soybean harvest, like the oat harvest, suffered from noticeably fewer acres planted (note that the corn belt overlaps much oat and bean growing areas.) OTOH, wheat appears to be driven by increased demand rather than loss of production; see the crop production report:

Thank you.

I'm readin' now. 8D

From the above "Who's afraid of Middle East Oil", BusinessWeek, January 10th, 2008

As the credit crisis deepens, investment banks and private equity firms are stepping away from dealmaking to nurse their wounds. Gulf funds are eagerly filling the void. "Sovereign funds have been shown every interesting idea in the last quarter," says Jeff Holzschuh, a Morgan Stanley banker who advised buyout firms on the TXU sale. "There is no question that they will change the deal world." But there is a question as to whether the change will be for the better. "This is capital we need desperately," says Felix Rohatyn, former Lazard Frères managing director and U.S. Ambassador to France. "But I don't think we should have any illusions that these are totally benign investments."

Felix Rohatyn's comment is telling: be wary, these gifts may not be "totally benign investments".

He who pays the piper, calls the tune.

Cheap oil was the grease that ran the U.S. market. Expensive oil, or at least its revenues, appears to be a lifeboat intended to keep the market crew afloat.

Which leads to my question: is this lifeboat, like a scene from the Titanic, meant to rescue? Or is it, like on Henry Hudson's Nonsuch, a sign of mutiny, a forewarning of being cut adrift?

Time will tell.

There are reports that rating agencies are considering cutting the US Government's triple A credit rating in the next few years, because of exploding welfare, Social Security and Medicare costs.

It is on the front page of today's FT US triple-A credit rating under threat from soaring welfare costs

The US is at risk of losing its top-notch triple-A credit rating within a decade unless it takes radical action to curb soaring healthcare and social security spending, Moody's, the credit rating agency, said yesterday.

The warning over the future of the triple-A rating - granted to US government debt since it was first assessed in 1917 - reflects growing concerns over the country's ability to retain its financial and economic supremacy.

It could also put further pressure on candidates from both the Republican and Democratic parties to sharpen their focus on healthcare and pensions in the run-up to November's presidential election.

Interesting that the FT article quotes Steven Hess, analyst at Moody's saying, snip... "If no policy changes are made, in 10 years from now we would have to look very seriously at whether the US is still a triple-A credit".

Given the baby boom demographic and the unpleasant scene of the U.S. slipping deeper into recession, isn't he a tad-bit optimistic to give a time frame of 10 years?

Social welfare, health-care, and pension increases are on the immediate horizon.

Is the FT preparing its readers for the long-term? Or is it letting the cat out of the bag now so that by the time short term events transpire, this will be old news?

Of course, it's all the fault of the poor/old/sick.

Pay no attention to the mountain of military spending and shady contracts to government's buddies.

Yes, you're right of course, it's always the fault of the poor, the old, and the sick. That's a given.

The armed forces can fight. The rich can sue. When assigning blame, pick the ones who can shoot the least return fire.

Maybe the source of the American government's triple-A credit rating is its function as the armed enforcer of international capitalism. No bombs, no borrow.

No guns, no credit. No credit, no butter. Ergo, no guns, no butter.


This is why patriots must resolve themselves to take at least 100 of the enemy with them when they die. True, an old person is not the fighting-fit they were in their 20s or 30s, but they can go out with a bang. Extra points for bankers, real estate types, and other parasites. I know there's sure no sitting around in an old folks' home in my plans!

Real economics of an unreal world.
Thanks for the summary.

Or just maybe we could just not piss money away on useless wars?

Here are the numbers:
Current Military
$727 billion:
• Military Personnel $136 billion
• Operation & Maint. $249 billion
• Procurement $111 billion
• Research & Dev. $70 billion
• Construction $10 billion
• Family Housing $4 billion
• DoD misc. $6 billion
• Retired Pay $52 billion
• DoE nuclear weapons $17 billion
• NASA (50%) $9 billion
• International Security $10 billion
• Homeland Secur. (military) $31 billion
• Exec. Office of President $1 billion
• other military (non-DoD) $1 billion
• plus ... anticipated supplemental war spending requests of $20 billion in addition to $141 billion for Iraq and Afghanistan wars already incorporated into figures above

Past Military,
$461 billion:
• Veterans’ Benefits $85 billion
• Interest on national debt $376 billion (80% est. to be created by military spending)

Human Resources
$748 billion:
• Health/Human Services
• Soc. Sec. Administration
• Education Dept.
• Food/Nutrition programs
• Housing & Urban Dev.
• Labor Dept.
• other human resources.

General Government
$295 billion:
• Interest on debt (20%)
• Treasury • Government personnel • Justice Dept.
• State Dept.
• Homeland Security (17%)
• International Affairs
• NASA (50%)
• Judicial
• Legislative
• other general govt.

Physical Resources
$116 billion:
• Agriculture
• Interior
• Transportation
• Homeland Security (17%)
• Commerce
• Energy (non-military)
• Environmental Protection
• Nat. Science Fdtn.
• Army Corps Engineers
• Fed. Comm. Commission
• other physical resources

The CBC radio news affair program, The Current, ran an interview with Canadian born, right of centre, Republican strategist, David Frum.

His interview is in the third half-hour link at http://www.cbc.ca/thecurrent/2008/200801/20080111.html.

Commenting on the U.S. medical system, Frum reveals that cumulative public (federal and state) health care expenditures in the U.S. are greater, per capita, than in Canada, where government funded programs prevail.

If I may be so bold as to roughly glean thru his comments, he opined that the U.S. is now saddled with the worst of both worlds, the high cost of a multi-layered and multi-source private system and the bureaucratic monstrosity usually associated with public systems.

IMHO, the U.S. is at a crossroads. With the boomers aging, it is no longer feasible or reasonable to expect, under current arrangements, the American government to support it's usual spread of business-as-usual bread and guns policies. Military over-extension and social generosity, coupled with private credit woes, will lead to a narrowing of public options in the near future.

China, Japan and Russia may strategize all they want, but ultimately if the U.S. goes bankrupt, it will be an American made phenomenon.

Which begs the question: how long can the top rating for public institutions in the U.S. continue?

Countries with debt denominated in their own currency can not go bankrupt. They simply create more currency to pay the debt. Inflation is the result and the people pay the price that way.

Practical, you state a valid point. Yes, there are many ways to handle the debt-load, i.e. as long as the borrower/lender exchanges are denominated in the green back.

However, trying to harness or macro-manage the inflation genie could prove to be very difficult.

Central banks usually go out of their way to avoid such pain.

Similarly, for the average person, this would mean navigating the road ahead through higher wages, or more debt, or resorting to some kind of bartering / deal-making for the basics of life.

Technically, yes, countries have ways to protect themselves from bankrupcy. But in so doing they can slump in influence, sovereignty over their own economies, and can become susceptible and vulnerable to outside events.

The International Monetary Fund had a firm hand in the restructuring of public policy in many countries.

I'm not sure how Americans would react to a loss in their standard of living or status in the world community. I'm not sure how the rest of the world would react to such a development either. If history is any guide, probably not too well.

Throw a shortage of energy resources in the mix it could get very interesting and not in a nice way.

i dont see an entry for the $ 430 billion interest on the national debt. 'course it doesnt buy anything useful so it is probably ok to leave it off the budget.

If Moody's were to downgrade US Treasuries would that stop foreigners from buying US Treasuries in order to manipulate the Foreign-currency/Dollar exchange rate?

How the heck does it matter, when the Fed is mysteriously determined to keep rates up and ensure that the only money in the system is with foreigners holding US Treasuries, who can therefore buy up Americana at a price of their choosing.

Wow. You know I think there's only 2 or so so countries that have never faulted on government debt ... US Treasuries and British Gilts. I recall reading somewhere that after the Revolutionary War there was some talk about not paying back the money borrowed, but the idea was 'nixed. The dollar might lose value, but jeekers it gets paid back. WTF is with Moody's?

No problem. When the time comes, Congress will pass a law ordering the agencies to restore the AAA rating; or ordering censorship, Australian style, to prevent a lower rating from being made known. Who wants to let any unwanted reality intrude on our societal decision back in the 1970s that production was taken care of forever, that there was nothing left to do but bloat "self-esteem" by handing out top grades and vast houses for nothing, inasmuch as we had acquired godlike powers to divvy up magically appearing spoils effortlessly and in perpetuity?

Re: Fuel shortages in northern Iran sparks riots

Are there any volunteers who are wiling to travel to Iran to tell the Iranian citizens that they need to curtail their energy consumption, so that Iran can increase its oil and gas exports?

Anyone? Anyone?

I am quite happy to travel to Iran for suitable recompense.

I went there a couple of weeks before the hostage crisis on behalf of Raytheon and had a great time.

You actually worked for these morally skewed people?
I sold them some testing equipment, and needed a meditation retreat
just to face my guilt.
We humans have evolved a survival strategy that is geared toward short term goals, and is a liability to our long term survival.

My customers were airlines - nothing military about that!

I've heard that record snow falls this season have shut down many roads in Iran. Must have delayed tanker trucks....

Hmmm.... Let's see, it's not a geological factor... it's not a geo-political factor....

Oh my gosh! It one of those "other" factors! They're working against us too!

Speaking of snow...it snowed in Baghdad for the first time ever:

George Dubya's in the ME. A cold front moved in. Coincidence?

There's bound to be a snow job wherever GWB goes. . .

I believe it snowed their in the 1940's. So not "ever".

According to the article, people who were alive in the '40s don't remember it snowing then. It snows in Iraq, but not in Baghdad.

Results a bit akin to the the Christmas truce.

For a couple of hours anyway, a city where mortar shells routinely zoom across to the Green Zone became united as one big White Zone. As of late afternoon, there were no reports of violence. The snow showed no favoritism as it fell faintly on neighborhoods Shiite and Sunni alike, and (with apologies to James Joyce) upon all the living and the dead.

Grains are limit up today (as of 11:25) wheat up 30 cents , corn up 20 and soybeans up 50. Winter wheat plantings were half of what was expected.
(I wonder if thats cuz people are planting more corn acres in the spring???)

Thank you.

Bloomberg Gold 900.10.

We will not plant wheat unless/until it hits $20.

It destroys crop rotation.

Watch cotton.

why cotton? (I know nothing about it)

Cotton is a substitute for synthetic fabrics which are oil based. It's the next big mover that hasn't been figured out yet. Also cotton acres will be switched to soybeans this year due to high soybean prices.


Plus cotton needs more local input. You can't just start and stop it.

Cotton gins do just one thing and those 6 row cotton pickers
approach $500 000 each.

Everything closed limit up except nearby wheat (4 cents off).

Soy nearby had expanded limits. Up 42 cents per bushel.

USDA: lower corn stocks, record rice yields

Jan 11, 2008 2:43 PM, By Elton Robinson
Farm Press Editorial Staff


Jim Rodgers recently recommended cotton as an indirect "oil play". On the theory that rising prices for oil-derived chemicals will force textile manufacturers to reduce the amount of nylon in cotton/nylon blends and shift towards more cotton.
Also, it's a general China/India play - they will buy more clothes as they get wealthier.
And as other soft commodities rise land will be used to grow other crops besides cotton.
Also China in general will be paving over farmland as they urbanise.

I think your link got cut off. The text version of the report is here.

WASDE-454 January 11, 2008

WHEAT: Projected U.S. wheat ending stocks for
2007/08 are raised this month 12 million bushels due to
lower projected domestic use. At 292 million bushels,
this year's ending stocks are forecast to be the lowest in
60 years.
COARSE GRAINS: U.S. corn ending stocks for 2007/08
are reduced 359 million bushels this month based on
lower estimated production and increased feed and
residual use. Corn supplies for 2007/08 are lowered 94
million bushels based on lower estimated production.

[CLUNK] Dang, there goes another wheel falling off.

Geez, it just gets worse farther down the report:


World and U.S. Supply and Use for Grains 1/
Million Metric Tons

World Ending Stocks
Total grains 3/ :
2005/06 : 389.16
2006/07 (Est.) : 336.43
2007/08 (Proj.) :
December : 315.22
January : 309.09

Wheat :
2005/06 : 147.65
2006/07 (Est.) : 124.38
2007/08 (Proj.) :
December : 110.06
January : 110.93

Coarse grains 4/ :
2005/06 : 164.64
2006/07 (Est.) : 136.48
2007/08 (Proj.) :
December : 132.98
January : 125.62

Rice, milled :
2005/06 : 76.87
2006/07 (Est.) : 75.57
2007/08 (Proj.) :
December : 72.17
January : 72.54

No problem for Core Inflation Land, where people don't consume food or energy.

I have some money invested in a commodities ETF (equal parts corn, wheat, soy, & suger). It is up on the order of 6% today as I type this, and is climing rapidly. I think that's going to translate into some serious increases in food prices.

Let guess...dba?

Take a look at RCI


?? Rogers Communications?

rogers commodity index. the ag part of the index can be traded in an ETF symbol: RJA

(Edit: might have been a mistake. the rogers index is normally called RICI: Rogers International Commodity Index, anyway)


Somehow, I get these dyslexic brain farts with this stock. Doh!!

Going Long Agriculture, Jim Rogers Style
posted on: December 04, 2007
Below is the email I sent to my site's research subscribers on 11/05/2007:

RJA is an exchange-traded note, similar to an ETF except that is liability based on an index, as opposed to a fund.

What this means is that the security does not actually buy the commodities contracts and roll them over, say the way GLD does. Instead, it's a promise to pay the holder of the note the appreciation of the Rogers Commoditiy Index (Agriculture component) in 2022 (or earlier if you have $4M worth and want to redeem). So you have issuer risk as well as market risk.

Here's the quick lowdown:

* Low fees (0.75%)

* Backed by a Swedish-government owned entity so in my mind, credit risk is minimal

* Broader agricultural exposure than other available commodity ETFs. For instance the Powershares one (DBA) is made up of only 4 commodities while RJA has exposure to over 20 items.

* Betting with Jim Rogers is a smart way to go.

* Historically, commodities have been shown to be very good investment and also negatively correlated with broader stock market


* Possibility of liquidity risk in exchange trading

* Credit risk in addition to market risk -- if Swedish Export (SEK) goes bankrupt, we have to get in line with other debtors with an unsecured claim.

* Many commodities near record-highs -- possibility of correction.

* Historically, the RJA has underperformed the broader Rogers Commodity Index (RCI) which is a superset of the RJA plus energy and metals as well.

Obviously I think the pros outweigh the risks. Because I have a good-size exposure to energy and metals already in my portfolio, I've chosen to open a position in the RJA and not the broader RCI. With the escalating costs for all commodities producers, we may at some point exit the equity side and play the resource story with the actual commodities themselves (either via an index like RCI or directly trading futures). For now, I'm comfortable with our portfolio and happy to add RJA at $10 per share.

Some additional color for my blog readers: first, if you are not familiar with Jim Rogers, I suggest hopping over to Charlie Rose's site and watch the three interviews Rose did with Rogers from 1995 to 2005. It's amazing to listen to Jim Rogers doing the exact same China spiel he's doing now 12 years ago! The man's investment calls are based on sound fundamentals and he has got a proven track record. Rogers notes in his "Hot Commodities" book that historically, commodities are negatively correlated with stock market returns. He gives a reasonable theory behind why this would be so and it's interesting to note that in the month that I've opened this position, it's up 3.5% while the broader market had it's worst month in years. So it may be a good bear market hedge.

I can't say if there is a bear market coming or not but agriculture fits neatly with my forecast of inflationary trends going forward. Food is getting harder to produce, productivity enhancements through technology are diminishing, climate effects are reducing yields and government actions only exacerbate the situation. If you want to play it through the companies as opposed to the actual commodities (or derivatives of), that's an option but at this moment, that story is very well known and hard for a value-oriented investor to pull off.

Finally, it looks like the trading volumes have picked up on RJA since I bought in so liquidity risk may ease. The nice thing about the Elements Rogers products is how you can pick and choose your spot to buy into the various components. The broad RCI index, comprised of energy, metals and ag, is probably where you want to be but now you can buy, in this instance, just the ag portion as oil and gold are near all-time highs. If oil pulls back, you can buy the RJN (energy component). Basically reconstruct the RCI but averaging down on pullbacks.

I have to admit it is a relief to have a lighter research load on this investment -- no quarterly calls to track, no worries about operating risks, etc. It's given me more than a second thought if I should switch to a sector-based ETF investment strategy.
Disclosure: Author is long RJA.

Energy thefts on the increase, as indicated by a couple of posts topside. Time to get locking gas caps for the cars.

Anyone have any ideas about the best way to secure a propane tank?

Time to get locking gas caps for the cars.

It does very little good. Enterprizing theives will simply crawl under
you vehicle and punch a hole in the gas tank and drain it.

Yeah. Might as well let them take the gas, rather than ruin your gas tank.

I'm hoping they'll go after the SUVs first. It's the SUVs that are being victimized in the catalytic converter thefts - because they're easier to crawl under.

For those vehicle owners who DO NOT HAVE a lockable garage--the obvious postPeak solution is to have a safe and quick disconnect system for a vehicle's gastank. Then, you motor home, park in your yard, disconnect your tank, then wheel or carry it to a secure interior location. If the thief realizes the tank is gone--he will move down the street to attack your neighbor's vehicle.

The Gas Tank Bensi Box

You saw the article at top about house's oil tank being siphoned? I suppose one could put that on a trailer and take with.

Locking covers for oil tank fills.

cfm in Gray, ME

the obvious postPeak solution is to have a safe and quick disconnect system for a vehicle's gastank...


Err... no. There is no post peak solution that involves a car.

Um, gas tanks just don't drop out like that, they're integrated into the design of the car.

Much easier to just set up a silent alarm then go out and eliminate the thief or thieves. Look up good places to dump bodies, if the law's even being enforced which it likely won't be.

No, solutions that don't involve a car are officially unthinkable. Ultimately yes, cars will be a thing of the past. But if they can be used as a reason to kill off a good part of the population as "gas thieves" then they will prove useful to Mother Earth yet.

Fleam - please tone it down. Maybe you're joking, but tone it down, anyway. I don't want TOD to go down this path. There's plenty of other places you can post this kind of thing.

I am thinking more down the line of supersensitive touch sensors for a car, much like those touch sensors that use capacitance to switch lamps on and off.

If a thief notes he's being watched, I figure he will retreat post-haste while he still has his freedom and hasn't "done" anything yet to be prosecuted for. Having noises and flashing lighte erupting from the house right when he's setting up for his act would likely defray him from completing it.

The downside is that the person trying to protect his property has now set himself up for pranking when the neighborhood kids find out they can cause mayhem in the house by touching the car. The old "ring the doorbell and run" type prank.

Or cats.

Oh D@m#! Not another one of those ^%%$ *&(&*%^*% car alarms!!

You HAVE heard the old story about the boy that cried "wolf", haven't you?

Perhaps a better approach is just to invest in one of those siphon pumps and a few safety cans. Fill up the car at the gas staion (assuming you are still able to do so), drive home, siphon out all but a gallon or two, and store in the most secure location you can find. Replenish your tank as needed.

If thieves try to steal your gas out of your tank, they'll be rewarded by a gallon or so, assume that's all there was to be gotten, and move on.

There may be good reasons for not being seen filling gas cans at a service station, if supplies get really tight and prices get really high. Stealing a couple of just-filled gas cans can be done a lot quicker and easier than stealing gas out of a tank. They could stake out a gas station, wait for someone to fill some cans, follow them home, then ambush. Best to just refill your tank, and transfer to the cans much later.

It is a lot easier to secure a few gas cans than it is a car's gas tank or an entire car. I would not recommend storage inside your house. Create a secure, hidden (burried) dump away from your house. The strategy I have suggested also works as a way to gradually build up a stash of extra fuel, even if rationing rules prohibit filling up gas cans at the pump (a restriction very likely to come into force at some point).

My personal stash is padlocked and I really need to give one door some attention - far too easy to force. If I knew I was going to be here longer term I'd get a proper gas storage drum on a stand. We used to see opportunistic theft with those - don't padlock it and you'd have a carload of kids worth of pilferage on the regular. I suppose when times get really tight we'll see people punching those from the bottom in order to get at the supply. FYI a gas tank punch isn't a big deal to fix - I got some diesel once by accident, so I punched the tank, let it drain, then just used a sheet metal screw with rubber washer and silicone around it.

I think times got much harder last summer. We've started parking the old farm truck with its left side right up against a bunch of bushes - no more siphoning allowed unless they really want to work for it. Mom started locking the machine shed to protect her little three gallon can for the mowers and I do like this one warning sign here in town. This guy apparently got tired of replacing locks and just stopped storing gas. He had(died a few months back) a mowing business ...

No Gas!

The rear of my car clearly states "240D DIESEL" and this dramatically reduces the market for my fuel.

We have people walking the streets at all hours in my neighborhood and this inhibits gas tank theft. Although I do keep a few gallons of diesel at home (safe, unlike gasoline).

Best Hopes for Diesel,


The rear of my car clearly states "240D DIESEL" and this dramatically reduces the market for my fuel.

We have people walking the streets at all hours in my neighborhood and this inhibits gas tank theft.

aha, this suggests another bit of trickery.

never being able to afford 'cool' cars in our youth, my brothers and I made use of cheap dime-store decal lettering and giant eagle decals, etc, to turn our vehicles into something they were not. We turned a 4-cylinder pontiac wagon into the "Swinburn Institute Prototype Turbine Vehicle" and actually got admiring glances, as well as making our other cars look vaguely official. (this was back in the mid-to-late '60's).

How much easier it will be to just affix the word DIESEL on the back of the car in 1" decals, and "Diesel only" in half-inch letters on the gas cap. Total cost, probably 2 or 3 bucks. The only drawback would be someone actually pouring some diesel in. I suppose I could always call it a "prototypical ammonia vehicle", but then someone would probably steal it.

Still, it's amazing how few people question official-looking lettering on things.

your mileage may vary...

I was under the perhaps mistaken impression that gas tanks filler tubes now have some kind of baffle system to prevent siphoning. It wouldn't stop one from punching a hole in the tank and draining it or course, but neither would a locking gas cap.

I tend to think this is right, just because I haven't heard anything about anyone losing gas this way in the news or by word of mouth. With current gas prices, surely people would be siphoning already if it still worked.

Yes, they have screens to prevent siphoning.

But people are still punching holes in gas tanks. I posted a story last year about a whole parking lot full of SUVs that were drained overnight. It was some kind of company fleet.

They're going to have a hard time getting anything out of my GEM.

I thought the same thing about baffles. Then someone siphoned dry my Nissan pickup tank. I tried getting a tube down it but failed and the Nissan people said it was hard to siphon from, but someone, probably with professional equipment sucked it dry. I had filled up that day and my neighbors got siphoned too. Now I have a locking cap and a parking security light.

Motion detector light{BIG ONES}and dogs.Dog barking will usually do it but to have a bunch of big bright lights flash on spook most asshats.Then there is having geese,and ducks...at night they make a racket that will raise the dead...the same with guinea hens...

Obviously, my problem is that I'm not thinking like a criminal. Thanks for the tip.

My Granddaddy:

"Locks are only for honest people."

My tank is inside the car. Problem is that the lines to the engine run out of the boot floor and along the transmission tunnel.

At least I won't have to weld the hole in the tank...

Yeah, get rid of it. Use renewable energy: solar air heaters, wood, solar and ethanol cooking ovens, solar hot water, etc.

Buried, underground.

Unless of course you meant a mobile propane tank ...

No, I'm talking about a larger tank in the 250-500 gal range. Burial gets it out of sight and may have a slight safety benefit. However, my supplier does need to access to refill, and if the supplier can access, so can any theif. All they need to do is tail the supply trucks and they can locate where all the tanks are anyway, so burial is not going to achieve all that much.

It seems like it would be harder to take propane out of a propane tank than heating oil out of a tank. Pressurized, liquified gas is just harder to move around than plain liquids. Just make sure your tank is on a concrete pad and bolted down to it. No one is going to pick up the tank and take it away then. If you're worried about someone taking the propane out of the tank, you could put a fence around it. Put the gate where the refill bung is and keep it locked until it gets refilled.

A question for the choir.

We all know that fuel prices are due to rise, and that a fuel efficient vehicle is a good idea. However, at least in europe, that's a message that's been heard and heeded by quite a few people.

The consequence is that on the used market the small and efficient vehicles command quite a premium. In fact it can be the case that the larger and supposedly less efficient vehicles are quite a bit less expensive than their smaller cousins, whilst giving more toys, space, etc.

Now if you have done the sensible thing, reduced your annual vehicle miles down to a very low level, at what point does it become more sensible to buy the less efficient, but better value for money larger vehicle than the fuel sipping compact?

When you are hauling around 4-5 other people.

Yeah, and/or when you have a real need to frequently haul large amounts of cargo. By real need, I mean that you've already been paying extra one or more times per month for delivery or truck rental on something that you will need on an on-going basis. Even then, consider getting a trailer first.

Just don't play the American mind game that you'll get the bigger vehicle because every now and then you might actually want it for something. Not that you've ever needed that bigger vehicle in the past...

Was sad to hear the passing of Sir Edmund Hillary. He beat Everests peak and passed on at the top of Hubberts peak.

The article about the carbon trading price for the new nuclear power for the UK is interesting. From my calculations coal power stations will have to cough up around £20/MWh which would seem to be a subsidy to wind and nuclear power. Due to change in the RO offshore wind is awarded 2 ROC's per MWh would this mean it could also be awarded the carbon credits? That makes it look very attractive, now if only we could manufacture them in the country too.

From leftists without logic

" Now that gasoline prices average above three dollars per gallon here in central Arkansas, the price of gas is once again an everyday topic. One thing seems to be certain - there is no direct correlation between prices at the pump and the price that is quoted for a barrel of crude oil"

When thats the first sentence it kind of destroys any possible credibility.

When thats the first sentence it kind of destroys any possible credibility.

Then he called Thomas Freidman a leftist. ROFLMAO.

I sent a reply to the "publisher" (listed on the website), we'll see if it gets any play.

I have trouble not going off on tangents... I hope the reply at least counters this guys lack of logic.

I removed the embedded video. For one thing, embedded videos aren't a good idea in the DrumBeat. The DrumBeats get a lot of traffic, and embedded objects really slow things down. Two, it didn't seem to be working correctly anyway.

I already explained you that embedded videos do not slow down page loading. It is just an additional picture, the video is only loaded after you press "play".

If it wasn't working you could have left a message or tried to correct it.

I already explained you that embedded videos do not slow down page loading.

That may be the theory. The reality is different, and even SuperG says so.

If it wasn't working you could have left a message or tried to correct it.

I did leave a message. I could have just deleted your post, since it links to the same article discussed upthread.

I would have tried to fix it, but I couldn't figure out how. If you want to re-post a text link to the video (instead of embedding it), feel free. You might want to do it upthread, with the earlier discussion.

It is only the additional picture - that's how embedded videos work. If that is too much, then that's fine.

Everything else is streamed from the server (youtube, or wherever the video resides) to the client. TheOilDrum.com is out of the picture.

For the umpteenth time....I know that. The problem is not the TOD server. It's that the more different servers have to be called, the slower the page loads. And for some reason, video servers like YouTube, etc., are particularly slow.

Embedded videos load up a (typically) shockwave flash application on the client whether you play them or not. It isn't just the additional picture that's displayed. There can be security problems associated with embedded objects as well.

I would much prefer a diet of poultry being fed a nutritional mix of grain and vitamin supplements than a chicken who scrounges for food consisting of worms and animal waste.

The money quote from the Jerry Jackson op-ed.

Mr. Jackson surely enjoys the fine cuisine of McDonalds, for he apparently has impaired taste buds. Even corn supplemented free change chickens are a delight, and I have had only a few that were entirely free range :-)

Little Hope for Suburban cuisine,


This is my first winter with more than a couple of chickens. I'm astounded by how much feed I have to give them in the winter compared to what I give them in the summer when they could range in the yard. 20 Birds have maybe 1/4 acre and that is mostly what they live on in summer. For what I have to feed them in winter, it might take two or three times that to grow grain - a guess. But they do like beets. I'll have to see if they like old potatoes and squash. Probably the best thing is to slaughter them in fall. Can one sun-dry a chicken? I want to get rid of my freezer too.

This footprint thing is hard.

cfm in Gray, ME

Pressure can them, wide mouth quarts work good, check out Coop Extension for info...

Interestingly, the "nutritional mix of grain and vitamin supplements" is an organic diet; as compared to the standard diet which also contains antibiotics (absolutely necessary in close confinement of standard chicken houses), meat by-products and sometimes growth hormones as well. He does not seem to realize the distinction between 'organic' and 'free-range' either. But considering the number of other absurdities in this article it is a minor point.

Which planet is this person from?The chicken finding its own food is ten times the quality of his "produced" chicken.....I have eaten both...BIG difference

Not to mention the eggs. Many Americans would have to take three swacks to crack a real chicken egg.

Gold hits 900 $/oz. This is well clear of 600 €/oz.

Anybody keen on a Peak Oil Factbook (apologies to the CIA)? Maybe in Wiki form? I spend an inordinate amount of time trying to figure out things like how much ethanol the US imports from Brazil, and when I do find something promising it turns out to be in Portugese....

175 million gallons in 2005 that costed 98 million US$.

4.2 billion gallons in 2006 that costed 1 billion US$.

P.S.: "Portuguese" has an 'u' before the first 'e'.


Centia produces biofuel similar to gasoline

Biofuel produced from a patented process is found to be a close replacement for unleaded gasoline. A series of trials on the Centia process using input similar to soybean oil at the North Carolina State University (NCSU) generated fuel closely resembling the carbon number profile and molecular composition of unleaded gasoline. The tests were conducted using demonstration reactors, operated under temperature and pressure with a proprietary catalyst developed for the Centia process. The tests achieved a mass conversion efficiency in excess of 90 per cent.

Robert are you out there today? Know anything about this company?

It hasn't hit my email yet, but the IPM has been released. Looks like a new "peak in all liquids has beem posted for October 2007 (85.605 MMBPD).

Still, the C+C record from May 2005 holds (barely) by reporting 74.124 MMBPD.

See http://www.eia.doe.gov/ipm/supply.html to get to the spreadsheets

I guess we're at "plateau oil," as Reuters put it...

I guess. Kinda reminds me of the summit of Denali. Not a lot of difference between the North Peak and the South Peak, but move a little further away and it's downhill in every direction. So, I guess we should just enjoy the view while we still have it.

Three things to consider:

1) For importing countries - that's most of the world, in 2006 there were just 43 net exporting countries out of 194 - it is 'net exports' that are important as 'net exports' will go to zero many, many years before conventional oil runs out - and they will fall by 50% much sooner than most people expect.

2) The way the oil statistics are collected means that an individual week or month's figures are not completely accurate, it's the long term trend that matters. If we are on a production plateau we've got 'peak lite' that is just as bad as peak - supply is constrained and prices will rise! Worse, the world's economy can't grow if the essential energy supply isn't growing.

3) Currently the only adequate alternatives to 'conventional crude' are the 'synthetic liqid fuels' which make up the difference to 'total liquids', which at around 11 mbpd (and despite only being at 'peak lite') does not appear to be able to fully make up the extra 2% or so required each year for BAU.

I'm mindful of all three points. And as I've told people, the way to disprove the peak has actually occurred (in C+C) is six continuous months of oil production in excess of 74.3 million BPD.

You can get a somewhat different answer on the peak production using different averaging methods (but within reasonable averaging periods they come up with similar results). Using Stuart Staniford's 13-month centered moving average with one recursion, you get a peak in November 2005 and a very flat approach and decline after that. Now, the "current" value (October 2007) using Stuart's method is incomplete but the average is still 400,000 BPD less than the highest averaged value for November 2005.

So, the trend was already down before OPEC cut it's output.

There is also one other trend to be mindful of (discussed previously in TOD) and that is the decline in the production in the absence of recession. It is likely that both price and production will decline if the US goes into something more than a mild recession. But the fact that production flattened and then declined in a "growing economy" is not something that we've seen recently, if at all.

The next few months are going to be very instructive, assuming oil stays near its current price. If there is any spare production out there, current prices should tempt producers to bring it to the market. There are also potential sources that aren't economical with oil any cheaper. Because of this, I wouldn't be too surprised to see production tick up slightly. Of course, one month means nothing. A moving average will be more instructive.

I will point out that, assuming the October numbers were real, they correlated with fairly benign inventory reports. After October's production, the inventory numbers turned dismal. I'm not sure it is possible to read anything into that about Nov & Dec numbers, but maybe it points to a fall off in production after the October spurt.

Or cold weather

I still like to think of it in terms of cumulative oil not produced, about 740 mb (C+C, the primary feedstock for refineries) since 5/05, i.e., the cumulative difference between what we would have produced at the 5/05 rate and what we actually produced--despite the highest nominal oil prices in history.

These >74 mb/d crude oil spikes demonstrate how difficult it will be to identify the peak in Matt Simmons' rear mirror. It seems we are driving under the geological peak through a tunnel. I guess there'll be a surprise when we see the light.

Regarding Thomas Barnett's article, The Future of Oil?: America's not in the driver's seat:

A second big driver is that many key producers are themselves becoming significant consumers, shriveling their capacity for exports. Indonesia became a net importer years ago while Mexico, a huge supplier for the United States, will head down the same path unless it soon opens up its national oil company (NOC) to foreign direct investment.

Meanwhile, strongman Hugo Chavez diminishes Venezuela's future export capacity by scaring off investors and -- in essence -- eating his seed corn: funneling today's windfall profits into socialist programs designed to buttress his popular standing. His latest scheme involves Venezuela's NOC using its logistical networks to import foodstuffs currently in short supply.

Fire-breathing Mahmoud Ahmadinejad pursues a similarly shortsighted course in Iran to predictable outcomes.

In general, all of the big producers are seeing their oil consumption skyrocket far above global growth, with Saudi Arabia, Russia and Norway leading the way. So while rising Asia demands a lot more oil, the biggest sources have trouble boosting production.

Mr. Barnett is cluing into the reality of export declines.

Interestingly, despite all the talk of gas-guzzling Asia and those selfish oil producing states who, heaven forbid, want to keep more of a precious resource for themselves, there is no mention that production capacity may have reached its limit.

Aparently, all that's needed is more foreign investment in places like Mexico and for countries like Venezuela to stop wasting away its windfall on mere people, "to buttress [Chavez's] popular standing".

Excuse me, but isn't that what we expect/want our own political leaders to do?

What's promising is that there is now a tacit/implied admission that the rules of the game are changing.

Yes, that seems to be the meme of the month: political peak oil, not geological. Peak Lite. That is what Total's de Margerie said, too. I wonder if he really believes it, or if he's just trying to break it to the world gently.

Anybody see this?

Mexico’s Pemex Stopping U.S. West Coast Oil Exports
January 11th, 2008

Via: Reuters:

Mexican state oil monopoly Pemex will stop shipping crude oil to the U.S. West Coast from February due in part to a shortage of infrastructure at Salina Cruz port, the company said on Wednesday.

Pemex was only shipping a tiny 20,000 barrels per day of oil to the U.S. Pacific coast out of its total daily exports of around 1.7 million barrels, but will now focus on exports to the U.S. Gulf coast and smaller shipments to Europe and Asia.

It was discussed yesterday or the day before. It's a pretty small amount of oil.

What I found interesting about it is that it's apparently more profitable to ship that oil to Asia than to the much-closer California. Who'd have thunk.

OK, except, ah (cough) I'm IN California and we are paying the highest gas prices in the nation. Every little bit counts AFAIC!

My peak oil index for January plunged to an all time low of 65.19. This index falls as the problem gets worse and rises when it gets better. It uses an inverse of crude oil spot price and multiples that by all petroleum products in days of supply. Price is adjusted for inflation and all figures use a 12 month average.

The reason for the sharp drop is that price is much higher this January than last, and supply is lower. The numerical drop (70.35 to 65.19) seems worse than the graph looks.

The challenge in using your metric is that it wants to asymptotically approach 0, so the changes will look smaller and smaller as the value (due to either higher price or small days of supply) gets lower. In other words, the worse things get (from a PO viewpoint), the harder it will be to see differences in your graph.

Use a log scale on the vertical axis. Or invert the index.

The story about Iranian boats vs USA warships from the other day is falling apart.

Apparently the allegedly threatening words that were were dubbed over images could not have come from the boats and were probably part of the heavy chatter on one of the channels the warships use.

There's more....


I think that this is looking more like an effort to manipulate Americans into supporting war by manufacturing the impression of an attack on our noble military which just happens to be patrolling off of Iran's coast.

Again, turn it around: if Iran had invaded Canada or Mexico under false pretenses, had occupied their oilfields and set up a puppet government, was patrolling heavily off our coasts, and if the Iranian VP flew to one of their warships and stood on the deck and threatened the USA with massive bombing unless we gave up our entire nuclear arsenal and closed down all of our nuclear power plants, wouldn't we see that as hostile intent?

At any rate, the story is losing any credibility it may have had.

Are you suggesting that the United States of America would use an alleged encounter between patrol boats and US naval forces as a justification for expanding a military conflict?

Well, I know it is hard to imagine that happening. (sarconal, that was...)

Today I read on Yahoo and also on Comcast's homepage accounts that continue to expand on this story -- perhaps conflating it with other incidents, and perhaps confabulating as well.

Apparently the Pentagon is working hard to keep this ruse afloat, so to speak.

I understand that the little boats are a hassle, and ought to stay clear of the US war fleet. I would stay far away if I were in a boat in a friendly situation. But this is a situation where the US administration is clearly intent on invading Iran, and has provoked some Iranians into at least giving the US "the finger" by such actions.

No doubt the Iranian military does not mind testing to see how close they can get without provoking a response as well, and no doubt some extremists in Iran are as intent upon war with the USA as our current government is intent upon war with Iran.

At any rate, such an incident is nothing to start a war over at all, but only serves as a fictitious fig leaf.

The cause of war? "Well, he got his speedboat too close to my warship! And somebody said one of them said mean things, too!"

And so millions more will be murdered and maimed, made refugees, hustled off into secret prisons to be raped and tortured.

"And so it goes." Oh, how I miss old Kurt Vonnegut, who had a real handle on the folly of war, as did my grandfather, who also saw frontline duty in WW II.

We destroy ourselves and our environment so easily.

Or why not elect such people as old E.O. Wilson to lead nations?

"...here is a chimera, a new and very odd species come shambling into our universe, a mix of stone age emotion, medieval self-image, and godlike technology. The combination makes the species unresponsive to the forces that count most for its own long-term survival."

We've thrown out science, reason, and wisdom for at least the last 40 years or so. We've even remade God in our own rather cruel images.

Work and pray for peace, even as resources are depleted and our habitat has become more toxic.

A couple days before the primaries?

Heightened tensions.

Populace in a scared heightened emotional state when deciding candidates...


I think I saw a movie about something along those lines a few years ago. Something about a dog, if I remember right. . .


The Iranians are playing John Wayne's "They were expendible."

And the USN is backpeddling like mad to make sure it doesn't do another Golf of Tonkin.

"Wag the Dog" starring Dustin Hoffman and Robert De Niro.

hmmmm.... perhaps this credibility thing is not in so much doubt as you think. Whereas the 'real thing' may surface in a backwater, the average joe sees none of that. I have seen nothing in Canada's MSM pointing out the dubious nature of the story, for eg. So it has served its purpose fully. Just like the Jack discovery, johnq public never sees the 'oops we're not going to do it after all' part.

What the typical viewer on this forum sees and pursues is not at all typical 'out there'.

As Tom Waits says in the song "Step Right Up"

You got it Buddy, The Large Print Giveth,
and the Small Print Taketh Away

So it has served its purpose fully

Could possibly be.

Whereas the 'real thing' may surface in a backwater, the average joe sees none of that...

Just like the Jack discovery, johnq public never sees the 'oops we're not going to do it after all' part

Well the average joe would if he was really paying attention.

I remember in 2002-2003ish timeframe. Aluminum Tubes for Centrifuges made page 1 big story. About 1-3 months later page 6, a 10 line short story discounting it.

Same for Mobile weapons labs, drone planes, Page 1 today, IMPACT, WALL-TO-WALL coverage, sometime later a page 7 story about 20 lines or less with "New Revelations" or something.

All of the above were practially mmediately exposed on the web if you searched.

You mentioned the "Jack" discovery, that's another good example.

Watch some news headline that takes a lot of air supply from the news, and has wall-to-wall coveage for a few days... then nothing.
THEN look to see what other things were/are happening that now MIGHT not get as much coverage if it were not for....

anyways... I agree.

give this a read sometime.

25 Rules of Disinformation:
8 Traits of The Disinformationalist:
(Or do a google for that title, for other versions)

The encounter is looking like a serious piece of political theater orchestrated by the American Navy. Is the intention to start a war with Iran? Absolutely not, the US has taken a different tack, and military action is off the table. So what is the intent? It is all the more perplexing because Admiral Fallon, in particular, has worked to lower tensions in the region.

My guess is that the intended audience for this little drama is Israel. Bush landed in Jerusalem this week and took a relatively hard line with the Israelis. Told them to dismantle some settlements, to withdraw from the West Bank and provide for a contiguous Palestine. And then announced that he had plans to come back and watch them sign a peace agreement before his term ends. With every stick comes at least a little carrot. The Israelis are paranoid about Iran and their nuclear program, so I'm guessing this was the Administration's way of saying, don't worry, we've got your back.

This push for a mideast peace agreement is proving to be very interesting. Like anticommunist Nixon had the freedom to go to Beijing, so islamofascism fighting Bush has the ability to transform mideast foreign policy. If the Israelis snub Bush, you can be sure they won't get a more agreeable bargaining position from an Obamma administration. And behind closed doors they've been made to understand that this deal is really being brokered by the Saudis. And unless the Israelis suddenly discover half a trillion barrels of oil somewhere the Yanks know where their bread is getting buttered (to mix metaphors all the way from petroleum through biodiesel to methane producers).

We live in interesting times.

EIA Washington is just out with their IPM figures for October.

As for the Crude Oil Only figures:

Would you believe it? Although they revised downward every month from September backward through April, somehow, October production managed to get above 74 Mb/day. But, still shy of the much watched peak of May 2005!

I keep selected data on my own Front Page:


Here is the EIA Washington link to the full report:


USDA Projects Higher Grain Costs

The USDA also forecast a drop in world production of soybeans, which led to supply concerns and a sharp rise in the price of soybeans Friday.

The price hit an all-time high of $13.1025, beating the previous record of $12.90 set in 1973. For the week, March soybean futures rose 3 percent to close Friday at $13.05 a bushel.

High prices of soybeans can be a big problem for meat producers, because the crop can be used to make animal feed. Corn is also used to make feed, as well as the alternative fuel ethanol. Corn has skyrocketed to record high levels due to demand for the fuel.

I love it. Iowa loves it. Now if we could just get those nasty hog factories shut down and grain exports stopped. If the ELM works for oil it should work for grains too. We should put cattle on all those acres supposedly available for switch grass or cellulosic ethanol. Beef isn't bad; tastes rather good IMO.

A question for you Practical:
Would you be:

towards the momentum of residents of less developed countries (like China) aspiring to eat as much beef as an average American, or an average Iowan?

Actually not. What Americans have gotten used to is LOTS of fat and lard is a better tasting source of animal fat if that is what you want.

Fish, and shell fish, with it's variety of tastes and textures, are not only less boring than beef they are better tasting and better for you :-)

I do eat beef once a year, on Fat Tuesday. I share a porterhouse for 3, prime aged beef, serving in bubbling butter. Other than that I generally avoid it.

In Iceland they only have grass/hay feed beef (ancient breeds. no imported breeding stock allowed) and it is a bit more interesting, but only as a novelty. Reindeer is MUCH better !

Best Hopes for Good Eating,


Our supermarket has started carrying some beef and chicken that is raised humanely, on an all vegetable diet with no hormones or antibiotics. I suspect that is still not quite the free-range, pasture only standard that we should hope for, but it is a step in the right direction, so I do buy a little each week just to encourage them to make further steps in that direction. The quality does seem to be just a tad better, and the beef is quite lean.

Seafood makes wonderful sense for you in NOLA (and along my own state's coast as well). Everything here in WNC comes courtesy of frozen CO2 - not very exciting by the time it gets to us, and not very energy-efficient either. One can occasionally get a very good fresh mountain trout meal around here, though!

"Raised humanely"?

How can it be humane to raise an animal for the sole purpose of slaughtering it and consuming it?

When we reach the point where we do not have enough energy to feed the 6 billion inhabitants of this planet, one thing is sure. It will not be ethical or moral to eat flesh.

Sorry for my PETA outburst. I know we are not there yet, but that day is coming. Ethics follow economics. Take slavery as an example. As long as it made economic and political sense, people ignored or rationalized the morality.

Depends on the basis of your morality.

Suppose I think overpopulation is destroying the planet.
Suppose I point out that in order to feed 6 billion people you have to rely heavily on grain monoculture.
Would it thus be fair to say that grain monoculture is destroying the planet?

Why then, would it be moral to take land being used for pasturing cattle away from graziers, and use it to grow more grain, so that we can support an even bigger population?

If you think meat is murder, go ahead and say so. (Should lions go to prison?).

Do you think a country like New Zealand, which has a low population density and is blessed with many beautiful national parks, and which supports many sheep and cattle on its ample grazing land, should turn their pastures into teraced rice paddies in order to cram 100 million people into the islands that currently support 4 million?

Does morality consist of supporting the greatest posible number of people at a quality of life slightly superior to that of a rat in a cage?

Morality will be dictated by the challenge of feeding the human population. And when the question comes down to feeding hungry children or grazing livestock, the only defensible answer will be to feed those children.

Disagree. We'll eat less meat, no doubt, but animals are a way to make use of land that can't be farmed. And I think there will be more and more such land, as irrigation and massive chemical inputs become more expensive.

Much of Nebraska will stop growing corn (what to name the Univ. of Nebraska Football team ?) as irrigation water becomes ever deeper or nonexistent. Range land, perhaps some dry land cotton (the lowest water requirement row crop AFAIK, enough rain in NB to support cotton w/o irrigation I suspect) if it warms slightly (due to AGW). Run the ag machinery on cottonseed oil (a by product of cotton) and feed a few hogs on cottonseed meal.

The Nebraska Cotton Pickers ?

Lots of scrap metal in those ethanol plants there.


Wow! I did know the extent of Nebraska irrigation of corn fields until I read your post and out of curiosity looked up the statistics. 70%!!!! Yikes!


perhaps some dry land cotton (the lowest water requirement row crop AFAIK, enough rain in NB to support cotton w/o irrigation I suspect)

Shrubs like Hazelnut can send roots deep, can yield food, and the organic bits like leaves and branches can be made into biochar. The shells are good stock for activated charcoal.

They could go back to wheat and grain sorghum, which is probably what they were growing prior to tapping the aquifer for irrigation.

A large portion of Nebraska is sand dunes, complete with yucca, as seen below. This material was blown out of Colorado by prevailing winds during a glaciation and if Nebraska gets just a bit drier they'll start moving. They see 'blowouts' now where winter winds carry stuff away, but the dunes are largely anchored by vegetation.

Sand Dunes & Yucca, Alliance Nebraska


You need to read "Guns, Germs, and Steel: The Fates of Human Societies" by Jared Diamond.
Quite and eye opener about how important livestock is. It produces one of those light bulb moments that make life interesting. He talk a lot about the domestication of plants and livestock.

They eat things you can't, produce fertilizer and milk, pull a plow and you can eat them.
In a post peak world farm animal are is going to be very important, again.


I'm not going to get pulled into a dispute wrt eating meat vs. vegetarianism/animal rights. I respect your point of view, but also respectfully disagree.

I plan on eating both the rich and the PETA people. I expect the latter to be tender, well marbled, and organic. Probably more tasty than the rich.


Well, I hope so. Did you see those world inventory numbers up above? If we keep draining inventory at the last year's rate, most of those grain supplies will be gone within five or six years!

World Ending Stocks
Total grains 3/ :
2005/06 : 389.16
2006/07 (Est.) : 336.43
6.4 years

Wheat :
2005/06 : 147.65
2006/07 (Est.) : 124.38
5.3 years

Coarse grains 4/ :
2005/06 : 164.64
2006/07 (Est.) : 136.48
4.8 years

Rice, milled :
2005/06 : 76.87
2006/07 (Est.) : 75.57
58 years, assuming people don't switch to rice!

As geologic peak oil gets closer, potential oil supplies from troublesome parts of the world can no longer be ignored. It's not like the 70s, when the North Sea and Prudhoe Bay were there to bale us out.

The actual peak will be determined by a mix of geological and political considerations.

"Peak oil" as we know it will never happen. Sure the world will one year soon go into irreversible decline, but the entire situation will be attributed to Above Ground Factors. Alas, Matt Simmons et al will never become the global superstars they are seeking to become. ;-)

There's got to be some sort of law (a corollary to Murphy's, no doubt), that when we are really down and desperate, the very last place where there will be any oil to be gotten will be in the very worst place it could possibly be to have to get it from.

And the Russians have already claimed it.

There are two or three trillion barrels of bitumen in place and current technology allows for the recovery of from 10-30 percent of bitumen from fields with high bitumen saturation/porosity.

THAI technology theoretically recovers 70-80% of bitumen including bitumen in lower pressure reservoirs, i.e. near surface. According to recent Petrobank statements THAI testing resulted in good well control and thus more bitumen in the world might become recoverable if longer term testing is in line with current pilot project test results.

Canada is expected to grow bitumen production and heavy oil refining. It might be decades before peak bitumen production is reached.

The large numbers of SUV's, sports pick up trucks, luxury and premium cars on U.S. roads might yield to fuel efficient cars as the business downturn and out of balance markets and inventory take away jobs and income.

Plans to try to switch from gasoline to ethanol endanger the domestic and global economies. Using the entire corn harvest for ethanol might only replace 12 percent of the gasoline used in the United States. The United States produced 40% of the world's corn harvest and used to provide 70% of the world's corn exports, but is danger of becoming a corn importer with new Federal ethanol laws. The U.S. corn crop for 2007 was forecast to be about 13.2 billion bushels. The 2007-8 wheat crop was forecast at 2.6 billion bushels. The predicted U.S. ratio of wheat to corn harvested was roughly 1 bushel of wheat to 5 bushels of corn.

Capital might be better invested in funding energy company expansion (IPO and jr. co. new issues), farm expansion/new land under cultivation, and anti federal-ethanol law lobbying than in hoarding commodities.

70 - 80 % of the thick gooey stuff ? worldwide recovery of liquid crude is on the order of 25% (that would include the light sweet and not so light heavier kind too) ................and their are people saying that technology wont save us.

when something sounds too good to be true, it usually is.

THAI certainly sounds promising...but personally I have decided to pay it no attention until it reaches at least a 100 kbpd flow rate. As we should all know by now, "it's not the size of the tank, but the size of the tap."

A minor edit - its Bemidji, not Bemidi.

I did a Drupal and Google search for posts on TOD mentioning the documentary, Oil, Smoke, and Mirrors, and only found it mentioned once back in 2006.

Have any of you seen how Richard Heinberg links 9/11, the Patriot Act, Peak Oil, and the War in Iraq together in this short documentary?

Here's the last 5 minutes of the doc... http://www.youtube.com/watch?v=DuEcsqA6MDE

and the entire 50 minutes... http://video.google.com/videoplay?docid=8677389869548020370

After watching the entire doc, in order to gain a majority MSM acceptance of our PO reality, it seems as though we must spread the truth that the War in Iraq is a preemptive act by the Bush Administration et.al. to address Peak Oil for the U.S. Empire. The growing recession, inflation, the housing market collapse, and the credit crisis are all direct effects of Peak Oil. The MSM keeps spinning around pointing fingers at everything except for our Peak Oil reality. I feel that it's the obligation of this forum to become the reality think-tank of the MSM.

There have to be members of the PNAC and/or Cheney's Energy Task Force who read TOD. Since all of this has been orchestrated by them, what is next on the timeline?

I did a Drupal and Google search for posts on TOD mentioning the documentary, Oil, Smoke, and Mirrors, and only found it mentioned once back in 2006.

There's a reason for that. We discourage the 9/11 conspiracy stuff here. People think peak oilers are wacky enough as it is; the last thing we need is to be associated with that kind of tinfoil hattery. And I've found it's futile to discuss it, anyway. People who believe will continue to believe, no matter how much contrary evidence is presented. It's a waste of bandwidth. And there are lots of other sites where that kind of thing can be discussed.

Leanan, well put !

I like my Tin Foil Hat...thankyouverymuch....it keeps the Sun from cooking my brain if I wear it over a Ball Cap.....(the fact that it keeps the Aliens from reading my Peak Oil thoughts is just a nice byproduct).:)

The World turns, with or without U.S.