Drumbeat: April 8, 2010

Raining on Rio's parade: An Olympic city faces a sudden loss of oil revenue

THEIR new-found hoard of oil still lies 7,000 metres (23,000 feet) beneath the Atlantic Ocean, but the signs are that it has already gone to Brazilian officialdom’s head. No sooner had Petrobras, the national oil company, announced the discovery of a gigantic cache of crude oil buried beneath a thick layer of salt below the ocean floor than every vested interest in the country had a plan to spend the windfall. Brazil’s 27 governors and its 5,600 mayors are all looking to garnish their budgets. Civic groups want their cut of royalties to fight poverty, scientists to fight climate change and students to improve education. “Pre-salt oil is like a pretty woman on a dance floor full of men,” Luiz Inácio Lula da Silva, Brazil’s president, put it bluntly. “Everybody wants a go.”

That is troubling for Rio de Janeiro, which as Brazil’s main oil province has until now enjoyed the lion’s share of royalties. Most of the new deposits lie off the shores of Rio and São Paulo states. Last month the lower house of Congress approved by 369 votes to 72 a bill by Ibsen Pinheiro, a congressman from southern Brazil, that would radically redistribute the oil bounty among all states and municipalities. To many Brazilians, spreading the wealth seems reasonable.

How Kyrgystan Violence Could Impact U.S.

The swift collapse of the government isn't just a nightmare for the nervous rulers of the region; it's a serious cause for concern for both Central Asia's big neighbors, Russia and China, as well as for Western countries trying to fight wars against an Afghan insurgency as well as wider wars on terrorism and drugs. What Kyrgyzstan tells us is that the rulers of the oil-rich Central Asian nations are in fact far less stable than they pretend. Until the Tulip Revolution, four of the five former Soviet republics that make up the region were still run by the Communist-era strongmen—who controlled an estimated 35 percent of the world's natural-gas supplies. Two remain in power, Kazakhstan's 70-year-old Nursultan Nazarbayev and Uzbekistan's 72-year-old Islam Karimov. Both have been criticized for human-rights abuses, and the likelihood is that they will crack down even harder in response to the events in Kyrgyzstan's capital, Bishkek.

Talking transportation — Peak oil and the end of life as we know it in Northeast

You think things are bad now? Just wait. We could be inches or minutes away from a global economic crisis that will make the current recession look like fun — the day we realize we’re running out of oil.

For decades we’ve lived (and driven) in denial, somehow assuming we have the “right” to cheap gas and, therefore, low-cost transportation. Now it’s time to face reality and consider what will happen when — not if — gas hits $10 a gallon. The following are my and others’ hypotheses. Follow the embedded links for recent news coverage that contribute to my theories. These things haven’t happened — yet:

Valero Said to Sell Refinery to PBF for As Much As $230 Million

(Bloomberg) -- Valero Energy Corp. will sell its Delaware City, Delaware, refinery to PBF Investments LLC for $200 million to $230 million, according to two people familiar with the negotiations.

Credit is Dead. Long Live Cash!

Texas electricity provider First Choice Power in January launched a prepaid service called Control First. "In Texas, there are about a million households who have slim credit or no credit at all," says company president Brian Hayduk. Without requiring a deposit or credit, customers are permitted to prepurchase a set amount of electricity—say $100 per month. The company installs a smart meter that lets people know how much they've used—which spurs customers to manage their energy use more intelligently.

U.S. Pitches Shale Gas Studies Overseas

The Obama administration has asked nearly a dozen countries, including China and India, if the U.S. can assess their potential shale gas resources, a senior State Department official said Wednesday.

David Goldwyn, the department's International Energy Affairs Coordinator, said on the sidelines of a conference that if the assessments confirm U.S. Geological Survey estimates for shale gas resources, the new fuel source could transform the nations' energy policies and consumption.

U.S. Energy Secretary: Nat. Gas Reserves May Have Doubled

U.S. natural gas reserves may have doubled thanks to new drilling technologies, U.S. Energy Secretary Steven Chu said Tuesday.

U.S. natural gas reserves have definitely gone up by about 30 percent and "probably has doubled," Chu said in a keynote speech at a conference in Washington co-hosted by the U.S. Energy Information Administration (EIA) and Johns Hopkins University.

Natural Gas Extends Decline on Bigger-Than-Forecast Supply Gain

(Bloomberg) -- Natural gas futures extended declines in New York after a government report showed that U.S. inventories increased more than analysts anticipated.

Stockpiles gained 31 billion cubic feet in the week ended April 2 to 1.669 trillion cubic feet, the Energy Department said. Analysts forecast a rise of 28 billion, and the five-year average change is an increase of 11 billion. An unexpected rise in the number of Americans filing initial jobless claims also weighed on futures.

Russia Won’t Cut Natural-Gas Output to Support Prices

(Bloomberg) -- Russia doesn’t plan to cut natural- gas production to support plummeting prices after Algeria suggested the Gas Exporting Countries Forum should seek to limit supply when it meets this month.

“That is not possible,” Energy Minister Sergei Shmatko told reporters today in Moscow when asked about reducing output.

Venezuela gives Chevron gas extraction go-ahead

CARACAS (Reuters) - Venezuela on Thursday said Chevron can extract and sell natural gas from part of the Plataforma Deltana gas field, located offshore from the Orinoco delta.

Baker Hughes: U.S. Rig Count Continues to Climb

Baker Hughes reported that the international rig count for March 2010 was 1,074, up 6 from the 1,068 counted in February 2010, and up 62 from the 1,012 counted in March 2009. The international offshore rig count for March 2010 was 295, down 6 from the 301 counted in February 2010 and up 14 from the 281 counted in March 2009.

US Jan oil demand off 1.44 pct vs prev estimate-EIA

WASHINGTON (Reuters) - U.S. oil demand in January was 271,000 barrels per day less than previously estimated, and down 597,000 bpd from a year earlier, the Energy Information Administration said on Thursday.

Angola’s Oil Output to Rise 16 Percent on Discoveries, Licenses

(Bloomberg) -- Angola, which vies with Nigeria as Africa’s biggest oil producer, expects new discoveries to boost crude output by 16 percent next year.

Oil production will reach 2.2 million barrels a day by 2011, compared with 1.9 million barrels at present, Deputy Petroleum Minister Anibal Octavio da Silva said.

“New ultra deepwater fields will come on stream and new exploration licenses are being granted,” he told a conference in Cape Town today. “More than 30 new oil discoveries are under development.”

Economist: Natural gas price drop behind HST hike

A leading Canadian economist has blamed Nova Scotia’s new 15 per cent HST on sluggish natural gas markets.

"The provincial government had to resort to an increase in the value-added tax when anticipated natural gas revenues did not materialize," Avery Shenfeld, chief economist at CIBC World Markets, said Wednesday.

Deadliest Maoist Raid Highlights Mittal, Posco India Challenge

Resistance from property owners, some backed by Maoist or Naxalite rebels, and delays in approvals for land and mines have stalled more than $80 billion of projects in India that would double national steel output. Yesterday’s attacks are a setback to India’s efforts to rid the eastern states of left-wing guerillas and open up regions rich in iron ore, coal, bauxite and manganese to investment.

“If the global players had got a footprint in India they could have really made a good return on their investment,” said Abhisar Jain, metals and mining analyst with ICICI Securities Ltd. in Mumbai. “India as a whole will stand to lose if no global player is able to put up its plant here.”

Chavez announce rainfall in central Venezuela will help reverse energy crisis

Heavy downpours that have swept away two people and flooded homes in central Venezuela were hailed by President Hugo Chavez as an early start to the rainy season that may mark the end of an extended electricity crisis.

Porsche's fuel-efficient future

The German sports car maker insists that it will meet future fuel economy requirements in its own way.

Paul R. Ehrlich: The MAHB, the culture gap, and some really inconvenient truths

The human predicament—climate disruption, loss of biodiversity and ecosystem services, toxification of the planet, the potential impacts of nuclear war, and social and economic inequities that impede solutions to escalating environmental problems—has been amply described. Although the steps needed to solve the predicament are clear, few have been taken—even as the situation steadily declines. The trend in greenhouse gas emissions has continued rapidly upward. The extermination of biodiversity and loss of natural services has proceeded unabated. The number of hungry people has hit an all-time high, which means that so has the number of immune-compromised individuals. That, combined with continued rapid population growth, increases the probabilities of vast epidemics. In Asia, melting of the Himalayan water tower and rising temperatures threaten the food supply of 1.6 billion people whose countries are armed with nuclear weapons. There also have been increasing signs of great toxic peril for humanity and its life-support systems, with a growing threat from the release of hormone-disrupting chemicals that could even be shifting the human sex ratio and reducing sperm counts.

Despite the clear warnings about the predicament almost two decades ago from the scientific community, precious little has been done. That's why a group of social and natural scientists and scholars in the humanities is starting the Millennium Assessment of Human Behavior (MAHB, pronounced “mob”). The admittedly ambitious aim is to change human behavior to avoid a collapse of global civilization.

The Ecological Revolution!

This book is a major achievement. It combines enormous breadth of scholarship with consummate theoretical integration to produce a powerful political argument. It should be required reading for anyone who cares about the future of humanity and the planet -- that is, everyone! I do have some disagreements, but these take the form of an agenda for future dialogue rather than substantive criticisms.

Can earth survive climate change? Author McKibben sees a chance

"The world hasn't ended, but the world as we know it has -- even if we don't quite know it yet," he writes. "It's a different place. A different planet. It needs a new name." Since it's earth-like, he says, let's call it "Eaarth."

McKibben sees a slight chance we could still save the planet.

Stunner: Nature's review of 20 years of field studies finds soils emitting more C02 as planet warms

The most worrisome amplifying feedback is the defrosting of the tundra (see “Science stunner: Vast East Siberian Arctic Shelf methane stores destabilizing and venting). Another major, related feedback now appears to be soil respiration, whereby plants and microbes in the soil give off more carbon dioxide as the planet warms.

John Michael Greer: The twilight of the machine

The end of the age of cheap abundant energy, as last week’s Archdruid Report argued, brings with it an unavoidable reshaping of our most basic ideas about economics and, in particular, economic development. For the last three centuries or so, the effective meaning of this phrase has centered on the replacement of human labor by machines. All the other measures of development – and of course plenty of them have been offered down through the years – either reflect or presuppose that basic economic shift.

The replacement of labor with mechanical energy has even come to play a potent role in the popular imagination. From the machine-assisted living of The Jetsons to the darker image of reality itself as a machine-created illusion in The Matrix, the future has come to be defined as a place where people do even less work with their own muscles than they do today. All this is the product of what an earlier post called the logic of abundance: the notion, rooted right down in the core of the contemporary worldview of industrial society, that there will always be enough resources to let people have whatever it is that they think they want.

Solar greenhouses, Chinese-style

In Europe and North America, eating fresh perishable produce out of season usually means hauling it in refrigerated containers from regions where it’s in season, or growing it locally in heated greenhouses. Our large greenhouses tend to use technology developed in Holland: Huge boilers burn through prodigious amounts of natural gas, coal, wood, or other fuel to fill a network of pipes with hot water, radiating heat into vast leaky structures clad in a single pane of glass. Although these greenhouses boast extremely high yields, the amount of fuel needed to heat them generally far exceeds the amount that would be needed to haul an equivalent amount of produce from a region where it’s in season.

There are alternatives. One is the high tunnel, a simple unheated hoop structure clad in clear plastic. Small farmers in North America are increasingly building high tunnels to extend their growing season without spending a lot of money on energy-intensive technology.

Ireland 'among most vulnerable' to peak oil

HERE’S a conundrum: restarting global economic growth will, by definition, push up energy costs. Rising energy costs will in turn choke off that economic recovery, leading to a fall in energy prices. Try to restart growth again, and the brick wall of energy costs magically reappears. Repeat ad infinitum.

It is hard to overstate the extent to which our daily lives are subsidised by cheap, plentiful oil. Every 24 hours, Ireland burns around 200,000 barrels. That’s the daily equivalent of the muscle power of 2.4 million men, each working for a full year.

Our entire way of life depends on abundant, inexpensive oil. This era is now drawing to a close. Five years ago, the Hirsch report published by the US department of energy concluded that the world has “never faced a problem” as difficult as peak oil, adding that: “without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary”. Oil peaking will be, it warned, “abrupt and revolutionary”.

The advent of peak oil is, by definition, the end of decades of relentless economic growth, since this dramatic phase in human history has been entirely predicated on ready access to vast amounts of cheap energy.

Oil hovers below $86 as 2-month rally stalls

SINGAPORE – Oil prices hovered below $86 a barrel Thursday in Asia after the U.S. reported rising crude inventory levels, suggesting demand remains muted.

Iraq's Overly Optimistic Oil Plans

Iraq has the potential to be a major source of new oil in the next five to 10 years, but the process of scaling up production faces many obstacles.

Saudi Aramco to Supply Full Oil Volume to Asia in May

(Bloomberg) -- Saudi Arabian Oil Co., the world’s largest state-owned oil company, will supply full volumes of crude oil to Asia for loading in May.

Saudi Aramco, as the company is known, will provide 100 percent of cargoes sold under long-term contracts next month, according to a survey of refinery officials in Japan, China and South Korea who asked to remain unidentified citing confidentiality agreements with the Middle East producer.

Aramco’s decision to provide full exports for a sixth month comes as the Organization of Petroleum Exporting Countries agreed last month to leave production quotas unchanged from the fifth time since 2008. The group is exceeding the targets by the equivalent of a supertanker of crude a day.

Aramco pride at 'pampered' Ghawar

Saudi Aramco has produced more than 65 billion barrels of oil from Ghawar, a top executive said, adding the state-run giant was "pampering" the world's largest oilfield.

The field has been pumping since 1951.

"Ghawar's original reserves are over 100 billion barrels. Ghawar is still going strong, we are pampering Ghawar...We can sustain production for many years to come," Saad Turaiki, vice president of Southern Area Oil Operations, told Reuters.

Saudis unveil drill drive

State oil giant Saudi Aramco will drill at least 300 development wells on- and offshore this year, as well as 48 exploratoration probes, an executive said.

Bill Clinton meets Saudi king on unannounced trip

Former US president Bill Clinton met Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz in an unannounced two-day visit to the oil-rich kingdom, the Saudian news agency said. Clinton met Abdullah, the Saudi intelligence chief Prince Muqrin bin Abdulaziz, assistant defence minister Khaled bin Sultan and other top officials at the king’s farm outside Riyadh Wednesday evening where they discussed “issues of mutual concern,” agency said.

JPMorgan Said to Double Tokyo Commodity Desk on Hedging Demand

(Bloomberg) -- JPMorgan Chase & Co. has almost doubled the number of its Tokyo commodity traders to meet demand from utilities seeking to use coal-derivatives to hedge against price swings, said a person with knowledge of the expansion.

Energy Information Administration: Charting Natural Gas Consumption

The EIA just released their latest short-term outlook for energy. The commentary is good, if a bit dry. The charts are better, like the one showing natural gas consumption below.

BP, Conoco say Alaska pipeline would cost $35 bln

ANCHORAGE, Alaska (Reuters) - Denali, the company created by oil giants BP Plc (BP.L) and ConocoPhillips (COP.N) to build and operate a natural gas pipeline from Alaska's North Slope to North American markets, estimates the project will cost $35 billion, according to documents filed on Wednesday with federal regulators.

The Denali pipeline, which would run 730 miles (1,175 km) in Alaska and 1,020 miles in Canada, will deliver about 4.5 billion cubic feet a day of natural gas to North American markets, according to the company's formal plan to solicit customers, filed with the Federal Energy Regulatory Commission.

Russia's energy minister says Austria will join South Stream this month

MOSCOW (AP) — Russia's energy minister says Austria will join the Russian-backed South Stream pipeline project in April.

Russian news agencies are quoting Sergei Shmatko as saying Thursday that this would be the final deal before construction begins later this year.

Ukraine seeks pipeline threesome

MONTREAL - Ukraine's new government, formed by President Viktor Yanukovych after he was inaugurated in March, this week affirmed that the country's gas transportation network is for sale to no one, including Russian gas monopoly Gazprom.

At the same time, Russia has made it clear that it is willing to cooperate with the European Union in any project to modernize the network, which includes more than 60,000 kilometers of pipe plus 71 compressed air plants and 13 underground gas storage facilities. Last year, it carried over three-quarters of natural gas exports from Russia to Europe.

Russia Energy Min proposes oil tax based on profits

MOSCOW (Reuters) - Russia's Energy Ministry has proposed taxing oil companies based on their financial results starting from 2012-2013, minister Sergei Shmatko said on Thursday.

Russia Lures Poland With Simpler Crude Oil Purchases

Reporters traveling with Russian Prime Minister Vladimir Putin to a meeting with Putin’s Polish counterpart, Donald Tusk, in Katyn on Wednesday were handed out a statement that provides yet another hint of Russia reshaping its relations with foreign oil-trade companies, and trying to mend fences with Poland.

In the statement, the Russian government said that starting in 2012 state-controlled oil producer Rosneft will ship Russian crude oil directly to Polish refiners PKN Orlen in Plock and Grupa Lotos in Gdansk, eliminating intermediaries.

Khodorkovsky says no proof he stole oil

Russia's jailed former oil tycoon, testified for five hours in a packed courtroom on Wednesday, saying that none of the companies he is accused of stealing oil from ever reported the alleged theft.

He faces charges of embezzling more than $25-billion worth of oil from three subsidiaries of his former company, Yukos, and laundering most of the proceeds. His lawyers have called these claims ridiculous.

Our Friend, The Dragon

China is much in the news and on the minds of those of us in the West.

There is concern over China’s human rights posture, its treatment of Tibet, its monetary policy, its massive trade surplus, its burgeoning defense budget, its contribution to global warming, and its impediment of internet freedom.

But there is one aspect of Chinese policy which causes unneeded concern when it is actually beneficial to the world economy and a win-win situation: China’s aggressive efforts to develop oil and gas reserves.

Chinese oil giants likely to bid for Brazil's new oil reserves

Chinese three oil giants, namely Sinopec, China National Petroleum Corporation (CNPC), and China National Offshore Oil Corporation (CNOOC), will likely bid for Brazil's offshore pre-salt oil reserves when auctions begin, according to recent statements by Brazilian officials.

As one of the most valuable oil and gas resources in South America, the prospects for Brazil's offshore pre-salt oil blocks are highly promising. Petrobras, Brazil's state oil company, said that it plans to invest a maximum of 220 billion U.S. dollars in exploring Brazil's offshore pre-salt oil reserves – including Tupi oil field – prior to 2014.

Venezuela Planta Centro Power Plant Idled Amid Crisis

(Bloomberg) -- Venezuela’s largest thermoelectric plant has been idled since April 5 amid an electricity crisis as President Hugo Chavez plans to extend mandatory conservation measures through November.

The Planta Centro power plant, which has total generating capacity of 2,000 megawatts, has been completely offline for three days, the national grid operator said today on its Web site. The plant is conducting maintenance work and will restart a 350-megawatt turbine tomorrow morning, with another turbine coming online April 15, Electricity Minister Ali Rodriguez said.

Nigeria Appoints First Female Oil Minister

Nigeria‘s acting president, Goodluck Jonathan, has sworn in the country’s first female oil minister.

Diezani Allison-Madueke is a former executive of the oil giant Royal Dutch Shell. She will be responsible for reforming Nigeria’s corrupt oil sector, which accounts for most of the nation’s foreign earnings.

French expert says we need nuclear power

Depletion of oil and gas reserves, concerns about energy security and the environmental threat of greenhouse gases means Ireland must consider nuclear power.

That's according to Dr Bertrand Barre, Scientific Advisor to the French energy company, Areva Group.

Keeping One Eye on OPEC and the Other on the Fed

If money and its relative cheapness have fueled America’s, and the world’s, expansion, cheap energy has been played an equal role. As such there are many that think the only reason we were given two eyes is so we can keep one on OPEC while keeping the other on the Fed.

Inflation Is Baked In The Cake

The end of imported deflation plus peak oil plus a dovish Federal Reserve is an inflation formula.

Costs of driving shift up for 2010 as prices for gas, tires rise

It's official: Your driving costs are going up.

The average cost of owning and operating a sedan in the USA rose 4.8% this year to 56.6 cents per mile, or $8,487 per year, a study out today by auto club AAA finds.

Rising gas prices are primarily responsible for the increased costs and also are lowering the resale or trade-in value of cars that don't get good gas mileage, says John Nielsen, director of AAA's approved auto repair and auto buying network.

U.S. Mine Official Surprised by Size of Massey Damage

(Bloomberg) -- U.S. Assistant Secretary of Labor for Mine Safety and Health Joseph A. Main said he’s surprised by how large an area was affected by an explosion at Massey Energy Co.’s coal mine in West Virginia that killed 25 people.

The explosion at the Upper Big Branch mine spanned about 12,000 feet of shafts. Rescue efforts in the worst mining accident in 26 years have been slowed by dangerous levels of methane gas. Rescuers are drilling holes in an attempt to reduce the gas levels, Massey said today in a statement.

Barge Arrives to Pump Oil off Ship Stranded on Reef

(Bloomberg) -- A barge has arrived at the Shen Neng 1, grounded on Australia’s Great Barrier Reef, before an operation to remove 975 metric tons of fuel oil from the stranded Chinese coal carrier.

The Shen Neng 1, which ran aground on April 3, hasn’t leaked any oil in the last two days, Patrick Quirk, general manager of Maritime Safety Queensland, said. Any compensation and liability arising from damage to the Reef will be pursued “forcefully,” Environment Minister Peter Garrett said in Rockhampton today, according to a transcript from his office.

Canada's oil sands: Dirty but necessary?

(CNN) -- The first shock in new eco-documentary "Dirty Oil" comes in the first few seconds when a question is asked: where does most of the U.S.'s oil come from?

The answer according to the filmmakers is Canada. For the last seven years America's northern neighbor has been its number one supplier of oil.

Colonie library to launch writers' series on Monday

COLONIE -- An appearance by Saratoga Springs writer Jim Kunstler will kick off a series of appearances by local authors at the Colonie town library.

Kunstler will speak at starting at 7 p.m. in the Stedman Room of the library on Albany-Shaker Road.

Ocean Energy co-founder lecturing at UNE in Portland

Matthew R. Simmons, co-founder of the Ocean Energy Institute in Rockland, will deliver the third annual Paul D. Merrill Business Ethics Lecture today.

The event will take place at 4 p.m. on the University of New England’s Portland campus. A reception will follow at the UNE Art Gallery.

Simmons will be speaking on “Our Fragile Energy System: Is It Sustainable? If Not, Where Do We Turn Next?”

SLRD strikes Energy Resilience Task Force

Canada's first regional task force tackling energy resilience is ready to take shape in the Sea to Sky corridor.

The Squamish-Lillooet Regional District (SLRD) announced last week that it has struck an Energy Resilience Task Force as just one component of its Climate and Energy Planning Process, a strategy aimed at reducing greenhouse gases and building "regional resilience" in the face of phenomena such as climate change and peak oil.

Two Yemeni students fly to UK to participate in an international public speaking competition

The winner, Nawaf chose his topic to be updated and international. Global Peak Oil as an alternative energy was the title of his speech. The other winner, Soha, surprised the audience with her unusual topic, particularly to her Yemeni generation and community. She talked about Males: the Future Dinosaurs, life without males.

Manual for Civilization

My bet is that the reality of watching your civilization (and population) collapse is likely one of the worst things anyone could experience. I am also not so sure the problem is just knowing how to remake a technology. For instance after the fall of the great Egyptian, Mayan, and Roman empires we had evidence and examples of their engineering achievements all around us. But aqueducts or senate buildings are worthless without a society around them to maintain, contextualize and protect them.

It is also worth pointing out that there are likely well over a billion people on earth who currently don’t interact with formal economies or technological society at all. They will be very well adapted to a post collapse world, you should find some and make friends. They will likely be far more helpful than a manual on restarting the internet, because they know how to gut a deer.

In any case I thought I would create this blog post which I will try and keep updated as these proposals and efforts come to me (and hopefully come to fruition). I will also list some of the resources that I usually refer to when I get these inquiries.

Jan Lundberg: The People Of The Brook Versus Supermarket Splendor

As an antidote to modern trends of artificiality and alienation, the Slow Food Movement can only go so far. It's a limited number of oblivious people who are presently eating fast food too fast, failing to ever fast, who can instead decide to make pasta asciutta by watching the onion and garlic turn golden in the pan of heating olive oil. To really address the root problem, people need to be out from under the oppression of overwork and employment, and be free from advertising by food corporations.

Brazil Announces Temporary Elimination of Ethanol Tariff

On Monday, the Brazilian Chamber of Foreign Trade said it would remove the country’s 20 percent ethanol tariff until Dec. 31, 2011, Congress Daily reports. With the temporary elimination of the tariff, Brazil was hoping to pressure the United States into lowering or removing its own tariff and taxes on imported ethanol. Currently, imported ethanol is subjected to a 2.5 percent ad valorem tax and an additional 54 cents a gallon surcharge, which terminates Dec. 31, 2010.

US Air Force investing heavily in biofuel

President Barack Obama is leading a new drive to introduce more advanced biofuels into the military usage. Speaking at Andrews Air Force base he said, “Our military leaders recognise the security imperative of increasing the use of alternative fuels, decreasing energy use, reducing reliance on imported oil and making ourselves more energy-efficient.” He went further and called for 50% or more alternative fuels to be used in navy planes, ships and vehicles within the next decade.

Solar-powered plane makes successful maiden flight

PAYERNE, Switzerland — At the pace of a fast bicycle, a solar-powered plane took to the skies for its maiden flight Wednesday, passing an important test on the way to a historic voyage around the world — a journey that would not use a drop of fuel.

I.B.M. and Saudi Researchers Collaborate on Solar-Powered Desalination Technology

Desalination is an energy-intensive process, which has limited the deployment of such plants outside desert regions like the Middle East. But I.B.M. and the Saudi research institute, the King Abdulaziz City for Science and Technology, plan to dramatically reduce the electricity costs by building a 10-megawatt solar farm that deploys ultra-high concentrator photovoltaic arrays.

The technology will concentrate the sun 1,500 times on a solar cell to boost efficiency. That’s about three times the solar concentration of most concentrating photovoltaic panels currently in operation.

NRC to inspect Entergy Vermont Yankee reactor more

NEW YORK (Reuters) - The U.S. Nuclear Regulatory Commission said Wednesday it would conduct additional inspections at Entergy Corp's Vermont Yankee nuclear power plant due to the radioactive tritium leak the company stopped last month.

Entergy, which discovered the tritium leak in January, is remediating the contaminated soil and groundwater.

A legacy of Katrina: Green homes

NEW ORLEANS -- In this city on the mend, hundreds of state-of-the-art sustainable, energy-efficient homes are being built in lower-income neighborhoods, a trend that's outpacing most of the rest of the country.

More than 500 homes are being built with features such as solar panels, rain-catching cisterns and eco-friendly materials in neighborhoods that received the brunt of the damage from the 2005 floods following Hurricane Katrina. Hundreds of other homes are being given green upgrades.

China faces its biggest foe

HONG KONG - The Chinese leadership, long obsessed with snuffing out social unrest whenever and wherever it occurs, has encountered a foe that cannot be defeated by its four trillion yuan (US$586 billion) economic stimulus package, its Great Firewall of Internet censorship or even brute force: Mother Nature.

As the nation celebrates the miraculous rescue of 115 miners trapped for eight days in one of the country's notoriously dangerous coal mines in northern Shanxi province, the worst drought in a century continues to seize China's southwest. While state-owned China Central Television trumpeted the heroic rescue effort and provided blanket coverage, the head of drought relief in China last week found himself denying media reports of abandoned villages and an exodus of refugees from stricken areas.

EPA lead rule will cover more than half of U.S. homes

More than half of U.S. homes could soon be affected by a little-known federal rule to reduce lead exposure.

On April 22, the Environmental Protection Agency will begin requiring that contractors who work on pre-1978 homes be certified in lead-safe practices or face daily fines of up to $37,500.

Texas Oil Firms Oppose California Climate Law

WASHINGTON — Several Texas oil companies are bankrolling a petition drive to suspend California’s path-breaking climate change law in a move that may prove a bellwether for national efforts to address global warming.

Climate clash rekindles separatist grumblings in Alberta

EDMONTON -- Comments from Ontario and Quebec bashing Alberta's approach to climate change are causing some Albertans to think about separation, Alberta Premier Ed Stelmach said Friday.

U.K. Set to Tax Electricity to Fund Carbon Capture and Storage

(Bloomberg) -- The U.K. is set to impose a levy on electricity suppliers such as E.ON AG, Electricite de France SA and Centrica Plc to fund greenhouse gas-reducing projects using carbon capture and storage technology.

On the Energy Gap and Climate Crisis

1) Energy matters. Energy can produce bountiful supplies of drinking water. Energy enables food production, storage and dispersal. Energy enables mobility, connectedness, health and comfort. The late Nobelist in chemistry, Richard Smalley, devoted the last years of his life to delivering an admirable distillation of the benefits of abundant energy, and need for an energy quest.

2) Even with spreading efforts to conserve energy, a world heading toward roughly 9 billion people seeking decent lives will require far more of this resource than today’s supplies and systems can provide. There is already an enormous energy gap on the planet, with some 2 billion people lacking the simple gift of illumination or a clean source of heat for cooking meals.

3) If countries like China and India follow the American pattern in transportation, ballooning demand for oil is bound to be a disruptive influence on world affairs with or without the climate impact of all those additional emissions of greenhouse gases. Think of it this way; the United States, with 307 million (heading toward 400 million) people, now consumes nearly 20 million barrels a day; India, with more than 1.1 billion people, is barely in first gear, currently using 2.67 million barrels of oil but poised for vastly increased demand. Add in projections of car use in China and you see why status-quo fuel choices don’t hold up.

Number of cars declines for the first time since Second World War

The number of cars on Britain's roads has fallen for the first time since the Second World War, industry figures have shown.

Interesting spin by Economidies that China is aiding the world economies by their expansion into oil/NG development. A valid point if you ignore the fact that in addition to ramping up their hydrocarbon consumption across the board they are also effectively reducing access by the other economies to the remaining reserves by acquiring sole purchase rights to much of the existing and developing reserve base.

Supply is created in response to demand.
We "will" oil into existence.

I realize you are joking . . . but people really do need to realize that oil can soon be described with the much-maligned phrase "zero sum game". The more oil China uses, the less oil that will be available to the OECD countries. And it has been plainly shown by the decrease in oil consumption by OECD countries.

China demands more, price goes up, OECD demand drops because we use oil so inefficiently that it costs too much.

Ah, but look at the bright side, they're helping the rest of the world have its cake and eat it too. If they develop the oil/NG, they can re-export some of it quietly, embedded in goods, to Europeans and others who make environmentally pious declarations for public consumption, that in reality they would never be willing or perhaps even able to live by. It might be less efficient than having the Europeans and others develop the oil/NG themselves, but in politics, false piety often trumps all else.

Good point Paul. But I'm not sure there's room for two smart *sses on TOD. And I do believe I have senority.

se señor .. !!

Yes, RM

they are also effectively reducing access by the other economies to the remaining reserves

but it does no good for us to complain about the rules of a race just when someone starts overtaking us. It's been our race (the US and the West) for quite a while.

The Chinese are headed over a cliff as much as we are. The cliff analogy is a bit off because when it is reached by anyone, we all go over it together, not just the one who gets there first.

I have a question for Westexas; I appreciate efforts concerning data on annual oil production vs annual price the last few years. I haven't seen the ave price for 2009, was wondering where it came to? Also really curious about annual gloabl net exports. Thanks!

Also really love commentary by Rockman and Darwinian, as well as some others....

I had a post a couple of days ago (I believe 4/6) on annual oil prices. 2009 was $62. What I found interesting was the progression in recent annual lows--from $14 in 1998, to $26 in 2001, to $62 in 2009:


As Rockman can attest, a few years ago most Oil Patch types would have considered an annual price of $62 an extremely unlikely event, for an annual high price.

Here's my previous post:


After I finish up a project needed to pay the bills, I'm going to get back to work on our updated paper on net exports, but I am somewhat handicapped since I was relying on EIA net export data files, which they have pulled off their website, because of unspecified errors (based on the recent natural gas story, one wonders if they have been overestimating global net oil exports).

Incidentally, the Canada, Mexico, Venezuela (CMV) case history is pretty interesting. Venezuela's net exports started declining in the late Nineties. Mexico's net exports started declining in 2005. Even Canada showed a net export decline in 2008, which probably continued into 2009 (EIA). If we look at combined net exports, CMV went from 5.0 mbpd in 2004 to 4.0 mbpd in 2008. If we assume flat combined consumption, they fell to about 3.6 mbpd in 2009, which would be a double digit year over year decline rate. In other words, combined net exports from Canada, Mexico & Venezuela--three of our four largest sources of imported oil--are showing, since the late Nineties, an accelerating rate of decline in net oil exports.

(based on the recent natural gas story, one wonders if they have been overestimating global net oil exports).

Wes, what does that mean? We are looking at figures at or about 86 MBD. If the production figures are fudged that way, how far back do you think it may go? Also, what does that say about the Peak having perhaps passed? And, if that has been done, what impact would it have on current prices if properly corrected? Would prices be higher, or lower? It would seem to me that prices may be lower if the actual production figures are lower, but I am having a problem getting my mind around it right now.



I dunno. The EIA guy I e-mailed just said that they had pulled the net export/import data files off the website because of unspecified problems with the data set.

WT - do you need to edit your post? You seem to state that $62 was the annual average and the annual low.

What I am talking about is a succession of annual oil price declines, following discrete temporary peaks--and the annual oil price is the average price for a given year. Within a given year, there are of course daily and monthly highs & lows.

So, what we saw in this decade was a decline in annual prices in 2001 (to $26), followed by seven years of rising prices to 2008 (to $100), followed by the decline in 2009 (to $62).

What I thought was interesting was the steady advance in the annual lows (the year over year annual price declines) necessary to balance supply & demand in annual declining price periods. From 1998 to 2001, the low price almost doubled, and it more than doubled from 2001 to 2009. The average annual price to date for 2010 is somewhere around $80 (which exceeds all previous annual prices except for 2008). If the pattern holds, a future annual year over year price decline would be down to somewhere around the $120 mark. Time will tell.

Incidentally, the ratio between subsequent annual price peaks and prior annual lows almost doubled--from the 2000/1998 ratio to the 2008/2001 ratio.

For the sake of argument, let's assume that we don't see another year over year annual price decline until 2018. In 2018, if we extrapolate Chindia's recent rate of increase in net oil imports, and take Sam's best case for (2005) top five net combined oil exports, then Chindia's combined net imports, expressed as a percentage of (2005) top five net oil exports, would have risen from 19% in 2005, to 27% in 2008, to a projected 100% in 2018.

Crude FOB Forecast 1981 vs 2008

I threw in some trend lines for yucks. The April average is speculative, of course. What held the price up back then!?!? Demand was cut back more severely, near as I can tell. Demand must have crashed severely around the world in late '08, or funds pulling out caused us to overshoot the bottom as well as the top.

EIA has 2009 average prices up now: Spot Prices for Crude Oil and Petroleum Products. WTI was $61.95/bbl. The last digit of the year was the first digit of the price 2004-2007, ergo...

2004  	2005  	2006  	2007  	2008  	2009
41.51  	56.64  	66.05  	72.34  	99.67  	61.95

Thru April 6th Cushing Avg is $79.14 for 2010 per EIA.

Link up top: Aramco pride at 'pampered' Ghawar

Carbon capture and storage is looked upon favourably by producers as they need to inject gas into oilfields anyway to maintain pressure. If they can use CO2 instead of natural gas, they can send the natural gas to local grids where it can be used by industry or in power plants.

This is extremely misleading. They are saying: "Since we must inject gas anyway, we will inject CO2 instead of natural gas." ARAMCO has not injected gas in Ghawar since 1979. They are "pampering" Ghawar and injecting CO2 in an attempt to squeeze a few more barrels out of the tired old supergiant.

Some of the "facts" stated in this story was gleaned from this article published in 2008: Ghawar's Magnificent Five As you can see in the latest story there is an error. The five original wells have produced 350 million barrels total not 350 million bpd. Anyway:

Aramco plans to inject 40 million cubic feet per day of carbon dioxide into the field.

Does anyone think ARAMCO is piping 40 million cubic feet of CO2 per day deep into the Rub' al Khali and injecting it into Ghawar because they are very environmentally conscious? That's a joke!

Ron P.

there is the possibility that aramco is planning to inject the co2 into the permian.

“Compositional Grading in the Ghawar Khuff Reservoirs”

The paper presents the results of a study to investigate the variation of gas composition and key PVT properties with depth in the Khuff carbonate reservoirs of the Ghawar field in Saudi Arabia. The study was performed as part of a larger effort to characterize the reservoir fluids for compositional simulation and development planning.
It was found that both condensate content and hydrocarbon compositions decreased with depth and/or temperature while acid gas composition increase with depth. The composition of hydrogen sulfide varied from zero, at a threshold depth and temperature, to over five mole percent at greater depths. The observed variations of composition with depth were contrary to what would be expected from gravity-chemical equilibrium considerations




why ?

You tell me. Why would they do that?

aramco would inject gas generically to recover additional condensate from the permian khuff. if ksa is hurting for ng, it would make sense to inject an inert gas such as nitrogen (or co2, if available). based on the abstract cited, it is apparent that the khuff already contains a significant fraction of co2 and h2s and as the abstract states the compositional gradient is inverted(richer gas at the top of the reservoir). this would allow co2 to be injected down dip in the already contaminated part of the reservoir to recover condensate up dip.

a discussion of nitrogen use for eor and condensate recovery here(pdf):


acid gas injection here:

"Large Scale Acid Gas Injection Facilities for Gas Disposal"


So their plan is to divert attention from them covertly injecting CO2 into the Khuff to get more gas by telling us they are injecting into the Arab-D to get more oil. Sly dogs.

i dont know, have they ever specifically stated that the co2 injection was going in the arab d ? i may have missed that.


The project, planned for 2013, involves injecting about 40 million cubic feet of carbon dioxide daily into an area flooded by water in the Arab-D reservoir in the Ghawar field, Prince Abdulaziz Bin Salman Al-Saud, the country’s assistant minister for petroleum affairs, said today at a carbon capture and storage conference in London.

There's all kinds of interesting nuggests in this report:

Saudi Aramco has produced more than 65 billion barrels of oil from Ghawar.


"Ghawar's original reserves are over 100 billion barrels.

Assuming "over 100 billion barrels" means 100 billion barrels URR, then Ghawar is 65% depleted and well past its peak.

Aramco is pumping more than 5 million barrels per day from the giant field, more than half of its 8 million to 8.5 million bpd crude production, Turaiki said.

This would mean that all other Saudi fields are only producing 3 million barrels per day. Is this a reasonable number?

This would mean that all other Saudi fields are only producing 3 million barrels per day. Is this a reasonable number?

Of course it's a reasonable number, as opposed to something like the square root of -1 (I guess that's just irrational).

Last summer, they said they were going to "rest" Ghawar and produce Khurais full out at 1.2MM/day. But at CERAWeek recently, they said that Khurais was only batting .500 and Ghawar was still cranked.

you're just making up imaginary numbers.

Dpasquinelli you need to be careful when making such claims, especially when your accusations are directed toward a long time member of this list, one who is known for presenting facts, not fiction. You have been a member of this list for 4 weeks and 4 days, not long enough to be making such grandiose accusations.

Oil King Warns Of 'Green Bubble'

Likewise, the Khurais field, which Aramco brought online last year, has been tested at a flow of more than 1.2 million bpd, but is now doing less than half that. Al-Khalid says at this rate Aramco will draw down Khurais' 28 billion barrels at a rate of just 2% a year. Many big fields around the world commonly see declines of more than 7% a year.

We only have their word that Khurais has been tested at 1.2 mb/d but at least they admit that the field is only producing at 50 percent of that rate. You owe Joules an apology.

Ron P.

Ron, I think he was making a joke, as i^2 = -1 is an imaginary number, instead of an irrational number as Joules stated, If my understanding is correct.


Re-read the post that he replied to, and then go have a beer.

I was wrong anyway, because the square root of (-1) isn't irrational. Irrational numbers are those with unending decimals.



Numbers with unending decimals can be rational like 1/3 or any other number that can be represented as a fraction. An irrational number can't be represented by a fraction. Pi is an irrational number as are the roots of many numbers.

There I go again.

In a future keypost, I will prove that the Euler-Mascheroni constant is irrational.

If you can even prove that it's being unreasonable I'll be suitably impressed.

If you know of complex numbers, you'll understand that imaginary numbers are real enough !


real and imaginary numbers can be radical:


Part of the confusion is thinking of "i" or sqrt(-1) as rational number instead of an operator. While we use "j" instead, what the symbol really represents is a phase shift from the reference position for a phasor quantity. Multiplying a number by j twice, or squaring it puts the number 180 degrees (or pi for the purists) away from the reference. 180 degrees apart is -1 times the original phasor. Although there is plenty of math to prove out the sqrt(-1), it is easy to think of squaring j (or i) to get -1 times the original number. Starting at zero degrees which is the horizontal x-axis, multiply once by j and the phasor rotates to the 90-degree position, multiply again and it rotates to the 180-degree position, multiply again to rotate to the 270-degree, and one more time brings it back to zero. j^2*j^2 = -1*-1 = 1.

We use this stuff all day, every day...

Now, I'll introduce you to the "a" operator, which is 120 degrees used in three phase sequence components. C'mon, us EE's don't get the mathematical upper hand on you guys too often!

Now, I'll introduce you to the "a" operator, which is 120 degrees used in three phase sequence components.

Does that work as a pick-up line in a bar?

We'll see tomorrow night - I'm gonna give it a try.

Never saw that one coming! Talk about being blinded by science, so to speak. "Hey baby, let's get unbalanced and see what our positive sequence and negative sequence can do in a three phase. We'll try to lose that zero sequence, it's always at fault (ground that is)."

I have to get out more often...

I think the only person that line would ever have worked for is Tesla on Westinghouse. Although I think sequence components were a follow-on to Tesla's work.

If anyone wants to know what the heck we're talking about, sequence components are the fundamental energy representation in power multiphase systems, or three phase systems mostly. When the three phases are balanced with load there is only the positive sequence (+ve) and all is good. When there is an unbalance there is a proportion of negative sequence (-ve) and maybe zero sequence. Generators really don't like -ve because it can cause heating quite quickly. The rest is pretty mundane, but its what keeps power system engineers up at night. I advise junior engineers that if they want to be proficient in power systems and protection and control they have to know sequence components better than they know Ohm's Law.

Hey, we can't talk URR and BOE all the time... However, I guess the particle of relevance is if we talk about alternative energy systems which invariably end up connected to the electrical system, or grid, they have to work within this framework eventually.

yeah, thanks for the explaination, i never really got that from my ee course. i think a benevolent professor squeaked me through with a "b" on the final(i already had a job).

..and, if there are only 35,000,000,000 barrels remaining which are being pumped at the rate of 5,000,000 per day then mathematically this represents 19 years until completely depleted. But we know that oil fields don't just go on producing at a constant rate until the final day and then run out. So you gotta ask your self how likely it is that they can continue producing at 5Mbd without the old girl getting tired.

Also, if KSA is supposed to have a 4Mbd 'cushion' which they can access in short order if the market needs you have to wonder how much of this cushion is supposed to come from Ghawar. To my mind KSA's numbers look surprisingly dodgy.

That would come out to a depletion rate of 5.2142857% according to my figures (leaving off the repeating 142857's after that).

I don't recall Cantrell's rate, but it is something near that as I recall, and may be higher.

At least this gives us a better handle on actual reserves that the Saudis expect to tap in to.


This is new:

The five discovery wells at Ghawar, have produced more than 350 million bpd and are still producing today at a combined rate of 6000 bpd, Turaiki said.

In my take on Saudi Aramco's spin on the Ghawar discovery wells, I had this table that I derived from their data:

and they also said this at the time:

Altogether, the Magnificent Five have produced nearly 350 million barrels of oil. There’s no telling how much more they will produce — as the end of their story is not yet in sight.

The sum of the rates in the far right column seem to add to 12700 bpd -- 6000 is quite a drop. Whatever.

But I actually do think that the CO2 injection thing is part research project and part enviro-propaganda (enviroganda?). The amount they are injecting isn't going to deliver that much oil. I think they are more just curious how much higher the recovery % can get for already depleted reservoir rock. They don't have enough CO2 available to do much to Ghawar. As for the propaganda part, they first announced this at an environmental conference. They're just trying to be good global citizens.

"We are not doing our pilot CO2 project because the field is depleting, water injection is enough," he added.

Of course it's depleting. All fields in production are depleting. I guess he meant declining.

Of course it's depleting. All fields in production are depleting. I guess he meant declining.

Of course the field is depleting as well as declining. They stated in 2006 that Ghawar had produced just under 50 percent of its reserves. Even if we believed that was all it had depleted, which I don't, it would still be well above 50 percent depleted today.

Saudi Arabia’s Strategic Energy Initiative: Safeguarding Against Supply Disruptions

• Without “maintain potential” drilling to make up for production, Saudi oil fields would have a natural decline rate of a hypothetical 8%. As Saudi Aramco has an extensive drilling program with a budget running in the billions of dollars, this decline is mitigated to a number close to 2%.

• These depletion rates are well below industry averages, due primarily to enhanced recovery technologies and successful “maintain potential” drilling operations.

As you can see, they confuse depletion with decline here also. But anyway they admit that in 2006 they had a decline rate of over 2 percent, brought down from 8 percent with these new Horizontal MRC wells. But even these superstraws did not stop the decline, they only slowed it down and at the same time increasing the depleation rate.

Ron P.

"anyway they admit that in 2006 they had a decline rate of over 2 percent"

Yet in 2008,

As per the 'audit report' compiled by Fatih and his team, Ghawar produced 5.1 million bpd of crude oil in 2007, down from a peak of 5.5 million bpd in 1980 (when the field's capacity was fully utilized in response to the loss of Iranian production following the revolution.) and a recent peak of 5.3 million bpd in 1997. The observed post-peak decline rate is thus a mere 0.3 percent per year.


Yes, yes, I know.
Those are all lies.

Majorian, the link I posted, and quoted from was from Nawaf Obaid who was at that time Managing Director of the Saudi National Security Assessment Project, a government consultancy based in Riyadh. In other words from a Saudi Government Consultancy based in Riyhad. He is now a Saudi Strategic Affairs Adviser, based in Riyadh. Nawaf Obaid, Saudi Strategic Affairs Adviser

And no, I do not believe that this Saudi official was lying about their Ghawar decline rates. I cannot vouch for Fatih however. After all it was almost a year later, in 2009 when he started to come clean.

That being said however, I do believe Obaid was exaggerating as to the reserves of Ghawar. After all he is obliged to tow the official Saudi line as to proven reserves. But there are other Saudi sources for those decline rates.

Ravensworth, Saudi Arabia

One challenge for the Saudis in achieving this objective is that their existing fields sustain 5 percent-12 percent annual "decline rates," (according to Aramco Senior Vice President Abdullah Saif, as reported in Petroleum Intelligence Weekly and the International Oil Daily) meaning that the country needs around 500,000-1 million bbl/d in new capacity each year just to compensate.

And I don't think the ARAMCO vice president was lying when he let this slip. This is about decline rates however; it does not speak to the total depletion rate. If you divide total production up to that time, 2004, into their stated URR, you get a depletion rate of about 28 percent, or would have in 2004. However that all depends on their total remaining reserves being about 260 billion barrels. That as everyone in the business knows is a pure political number and has nothing to do with actual oil in the ground.

Ron P.

Hmmm... Gas injection, horizontal drilling, and a nationalized production company. I think I saw this before in Mexico with Cantarell... And didn't they experience a slow, steady decline with all these new techniques? I mean, come on, with all that technology and effort there should be a long, gracefull production curve to show for it...

Imagine what would happen if Ghawar did this...

That's really not good...

lizard -- you put me in the uncomfortable position of sounding like a supporter of the KSA'a misrepresentations but the rapid decline at Cantarell was always predictable (if we were given all the tech data). But the pressure depletion drive aided by the N2 injection program at Cantarell would offer a different (and much steeper) decline curve then the water drive depletion curve at Ghawar et al. Which we could also model fairly well if we were given the tech data.

True, Mexican papayas are not the same as Saudi dates, so apples to apples it could be difficult to model Ghawar. I think an interesting (yet unavailable) data point is the water cut they're experiencing. I'd love to see a graph of that over time... Better yet, in different locations (I.e. the edges vs the middle). That would give an excellent idea of how the field is really responding to injection.

Almost linear decline for years? and no sign of slowing down. They will hit zero within 1-2 years if this continue.

karl -- It might be a little better than that. But might even be worse. It's all a function of the depths of the perforations in the producing wells and the level of the expanding N2 gas cap. If there are a lot of wells producing just below the current N2 level then just a slight lowering of the N2/oil interface could shut in the majority of the wells almost overnight. We don't have those details but PEMEX does. They might not be willing to tell us but they should have a very clear picture of the end game for Cantarell.

I had to google Cantarell and came up with this latest news :

“We’re confident we’ll keep output from Cantarell at the current range” of between 590,000 and 620,000 barrels a day, Suarez Coppel said late yesterday in Cancun, Mexico. “The goal is that this year production won’t fall.”

Looks like they have managed to go just flat from the date when that chart was made. Lemon squeezing probably, but still impresssive ?!?!

paal -- PEMEX should have a handle on the decline rate. Not so much lemon squeezing as just geometry. As they continue to inject N2 the gas cap expands and pushes the oil down towards the producing perforations. As long as those perfs are still below the N2/oil interface level you'll see little decline. But eventually the N2 gets close enough to the perfs that it gets pulled into the production stream. The well will begin to "gas out" as opposed to "water out" in a water drive reservoir. They could still produce the well as the N2 production increases but that defeats the purpose of injecting the N2 for pressure maintenance. If we had the PEMEX data(perf depths, current N2 level, N2 injection rate) we could generate a fairly reliable future producion curve. PEMEX has done this. They know the future to a fair degree.

"Since we(Aramco) must inject gas anyway, we will inject CO2 instead of natural gas."

I have asked this Q before, without any answer , but I'll try again-

Q: Where will those insane volumes of CO2 come from , in the case of Ghawar ? (my head tells me they'll need alot of CO2 to get any meaningful boost from it)

Probably from geological formations just like they do in the USA.
They also have lots of natural gas maybe contaminated with CO2 as they do in Algeria where 15% of the raw gas is CO2. So instead of venting it to atmosphere they use it in teritary recovery.

Just because you don't know where it is coming from doesn't mean it's impossible.

Thanks, nice theories!
BUT to clarify my Q : Does anyone know -as a matter of fact- exactly where Aramco is gonna get their CO2 from?
(links anyone?)

The Google blurb for this:


had this:

The Khuff gas is fairly sweetwith a ~S content of 370-. 2000 ppm, CO2 about 6.2% and N. 2 about 11.5%. Janahi and ... in other major fields such as Ghawar, Abu Safah, Berri, ... hydrogen sulfideandcarbon dioxide. Productionis accompa- ..... through the porous clastics to traps in the Permian carbon- ...

This preview gives numbers for the Uthmaniyah gas plant, probably close to where they intend to inject CO2.

Uthmaniyah Gas Plant (UGP) in Southern Area Gas Operations of Saudi Aramco is one of the largest gas processing plants in the world. UGP was commissioned in 1981 as part of a Master Gas System (MGS) to process the associated gas from oil wells and expanded gradually to process non-associated gas (Khuff) as well. Currently UGP has the capacity to process up to 1.85 billion SCFD (53.5 x 106 m3/d) of associated gas in three low-pressure (LP) gas treating units and 750 MMSCFD (21.7 x 106 m3/d) of Khuff gas in high pressure gas treating unit.

Six percent of 750 MM SCFD yields what they need for the injection. There are also some electricity generating plants in the area.

Joules ,very impressive digging. Thanks.
After all, Aramco's plans are reality based and they have the monies to do it. I say: great go ahead.

Does anyone have a break down of where the UK gets its oil from please? As in which countries we import from and how much.

cheers a bundle

Err... from the UK mainly (and some North Sea fields in Norwegian waters). Although that is changing.


The above chart is common to me.
Although the Brits only import a tiny amount of oil - in contrast to practically all other EU countries, which import around 100% of their oil - the financial situation of that country is ugly to say the least. With a budget deficit of 12.8% (Germany 3.3%) they are in the same boat as Greece with 12.8%, which has to import ALL of its oil.
And then the public debt to GDP ratio (including bank bailouts) is about 147%. At least here they are No. 1 in the EU.

There's a pdf here - http://www.berr.gov.uk/files/file43846.pdf that does give imports broken down by region. However, it doesn't give a country level detail of imports.

Many thanks, very interesting.

So as our part of the NS declines, we will be every more reliant upon our good buddies the Norwegians. I guess the next question is what does the production/extraction future hold for them? When they go into decline (or are they already?) then we will be at the mercy of that too. Also, who else do they export to and do we have long term contracts with them.

I never knew we were going to be so dependent on the Norwegians.

It actually looks like Norway has hit peak already - http://www.eia.doe.gov/emeu/cabs/Norway/Oil.html. That link also gives the top importers of Norwegian oil.

Looking at that link it says that the UK imports 781,000 bbls per day in 2008. But on the data browser above it says the UK is only importing about 150,000 in total.

What gives? Something not right here.. I'm guessing that oil comes to UK for processing and then back out again to Norway so is netted off?

You need to differentiate between gross and net exports/imports. Net exports/imports are defined as domestic production less domestic consumption. If the number is positive, a country is a net exporter, if negative, it's a net importer. The following chart shows the change from net exporter status to net importer status for the UK:


Sam's best case projection is that Norway will be a net oil importer in about 16 years or so:


Let's assume that we have two countries--Production Land (P) and Refinery Land (R). P has two mbpd of production, but no refineries. R has two mbpd of refining capacity, but no production. Each country consumes one mbpd of product (let's ignore refinery gains and oil/product transportation related consumption).

P produces two mbpd and ships two mbpd to R. R consumes one mbpd and ships one mbpd of product back to P.

So, the net export/import calculations (Domestic production less consumption) are as follows:

Production Land: 2 mbpd - 1.0 mbpd = 1.0 mbpd in net exports

Refinery Land: 0 - 1.0 mbpd = -1.0 mbpd in net imports

Different refineries are optimized for different grades of oil so it makes sense to send the oil where it can be most efficiently processed. There's even a load of UK North Sea Oil in the US Strategic Petroleum Reserve (along with such stuff as Iranian Light dating back to the Shah).

Still hoping one of TOD's resident experts can can give a fuller answer.

Some more info here http://www.eia.doe.gov/emeu/cabs/United_Kingdom/Oil.html

And here http://www.greenergy.com/perspectives/UK_oil_supply_chain.pdf (PDF)

The best single reference is probably DUKES Annex G.4, which you can download at http://www.decc.gov.uk/en/content/cms/statistics/source/trade/trade.aspx.

It's 2 years out of date though, and that makes a big difference when the average UK decline rate is 7%/year for oil. (And probably worse for gas.)

You get a more up-to-date overall picture from the IEA website - subtracting the figures in http://omrpublic.iea.org/supply/uk_to_ts.pdf from those in http://omrpublic.iea.org/demand/uk_tp_da.pdf should give an idea of the current net import level.

For many years, because of its heavy concentration of refineries, the UK has imported a lot of oil it doesn't need, re-exporting it as refined product. And yes we import heavy oil and export light oil, to get the optimum refinery input mix. So it's quite a complicated picture, partly explaining why there is so little popular understanding of how dramatically the UK is switching back from being a major exporter to a major importer.

The other part of the explanation is that people - particularly motorists - don't want to understand.

One thing about net imports/ exports is that they combine crude oil before refining, with refined products, like diesel and gasoline and jet fuel. There may be imports of crude oil, but exports of refined products, or vice versa.

What happens is the mixture of fuels a refinery makes is somewhat predetermined by the kind of crude oil and the type of refinery, but this mixture may not match up very well with what the country needs. For example, if most of the country's cars run on diesel, a country may have extra gasoline to export, because the refinery makes it, but they don't need it all.

Or in terms of the specialized refineries you mentioned, I know that in Mexico, they need to sell low sulphur diesel, especially near the border, so that trucks crossing the border have the correct fuel. But Mexican refineries are not set up to make low sulphur diesel. To get low sulphur diesel, Mexico sends some of its petroleum to US refineries which can produce low sulphur diesel, and then imports low sulphur diesel from the US, plus other refined products they need. So for the US, there is a big difference between gross and net petroleum imports from Mexico.

Norway is also post-peak. Some of the Norwegian oil (and gas) fields feed directly into UK pipelines. We also still export/import some to optimise refinery use but I'm sure there's people who know far more than me regarding this. Robert Rapier, Euan Mearns etc. are you there?

From the Manual for Civilization link above:

"My bet is that the reality of watching your civilization (and population) collapse is likely one of the worst things anyone could experience. I am also not so sure the problem is just knowing how to remake a technology. For instance after the fall of the great Egyptian, Mayan, and Roman empires we had evidence and examples of their engineering achievements all around us. But aqueducts or senate buildings are worthless without a society around them to maintain, contextualize and protect them."

This is such a great point - lost on the free market worshippers... the story of technological achievement isn't about the lone man in the wilderness - the entrepeneur (also worshipped) - it's about the cohesion of society that facilitates the development of technology... When society really starts to break down all the cheerleading about personal electronic devices for example (our current holy grail of progress) - ithis and ithat - won't mean squat - mostly they will just represent a HUGE investment in a whole lot of nothing that accomplished very little of any significance. This fundamental idea is SO lost on those who want government / taxes to just disappear and think that 300 million people can disperse to their cabins in the woods while inventing the next big "gadget" in their garages... remove any of the tech nonsense we currently pray to from the context of modern society and you have something that's virtually worthless - even as a paperweight since these devices are just too small and lightweight now :)

I couldn't agree more wrt gadgets.

I have an iPhone. Ostensibly I bought it because it would allow me to 'surf the web' and collect my work emails whilst on the move. However, the phone part of it is bloody useless. My Nokia of ten years ago was a much better phone but didn't have email or internet. It was much more rugged as well - one could pretty much chuck it at the wall and it wouldn't break. Now I have to have a hideous rubber sleeve to keep my iPhone protected.

Just how did we cope in the early 90s when no one had a cell phone? How did businesses cope?!!

Yup, gadgets do not equal technology. They use technology but in and of themselves are not technology.

My basic operating assumption is that "multi-functional" = crap. I try to keep my technology as single-function and simple as possible. Yes, I miss out on a few bells and whistles that I probably wouldn't use much anyway, but my life is a lot more simple and less stressful, and the things I actually use actually do work, usually.

"My Nokia of ten years ago was a much better phone but didn't have email or internet"

I'm still am using one, it is battered, missing case parts, exposed antenna, but the chip still works.

I used to be a Apple employee and even a member of their consultants network.
The iPhone would take up to much time.

My 14 year old Nokia 5.1 is still in perfect condition and still happily accepts current GSM SIM cards. However the standard battery will no longer charge but the extended life battery (makes the phone look pregnant) still works fine. I use it as an emergency backup.

I remember getting my first pager some thirty years ago, thinking "this is great!... how did I ever live without this". My first cell phone was an Ericson Mobera (sp?); the lead acid battery had a standby life of about a day (60 minutes talk-time) and weighed ten or more pounds. Air time was 75-cents per minute, plus long-distance and roaming charges where applicable (basically, anything outside metro Toronto). Today, most everything I do is e-mail and text related, so my Blackberry Bold 9000 does it all.


Ah...."planned obsolescence" is a tried and true strategy for increasing sales of new products as well as parts. Microsoft is trying to make XP go away in this fashion, but it has been difficult to "make" people switch.

I've still got '98 running on one machine, and it's been busy rendering 3d HD graphics.. albeit very slowly.

Eager to try putting Linux and Blender on some boxes, but that's a transition I don't have the headspace for yet.

Whatever it is you've got running on '98 should run on Linux well enough, so you don't have to take on the brain damage all at once.

You can run the open source VirtualBox and put Windows 98 on open source OSes like FreeBSD or most GNU/Linux forks.

You may even be able to get it to run faster.

Yes,Dragonfly41,I have XP Home with Service Pack 3 on a laptop.It is very iffy getting updates even though Microsoft claims that this configuration is good for support out to 2012 at least.When I installed a new security system (Trend) it came up with over 30 security updates missing and quite a lot since.No problem getting them manually via Google as long as I know about them.I have looked into fixes for updates but haven't made any headway.

I have XP Business on a desk top which has no problems updating.

XP is a reasonable sort of operating system and I have no interest in upgrading to Windows 7 at this stage.

Ah...."planned obsolescence" is a tried and true strategy for increasing sales of new products as well as parts.

Agreed. To be TOD-relevant: that is also an ongoing concern for the current generation of hybrid automobiles. Specifially the battery packs and controller systems.

Monopolistic software companies seem to be a very big practitioner of this.

M$ recently had news articles about dropping Itanium support (http://news.google.com/news/search?aq=f&pz=1&cf=all&ned=us&hl=en&q=itanium).

Thankfully Linux runs on many hardware platforms. If/when ARM processor netbooks become commonly available, there is likely to be a Debian port ready for it. (http://www.debian.org/ports/arm/)

Specifially the battery packs and controller systems

Ahhh, but when the chassis is 'gone' the motors will still be fine prime movers for other things.

And who can't use such motors?

Taxation is a pretty good deal for most of us.

Study: 47% won’t pay income tax

In recent years, credits for low- and middle-income families have grown so much that a family of four making as much as $50,000 will owe no federal income tax for 2009, as long as there are two children younger than 17, according to a separate analysis by the consulting firm Deloitte Tax.

Tax cuts enacted in the past decade have been generous to wealthy taxpayers, too, making them a target for President Barack Obama and Democrats in Congress. Less noticed were tax cuts for low- and middle-income families, which were expanded when Obama signed the massive economic recovery package last year.

The result is a tax system that exempts almost half the country from paying for programs that benefit everyone, including national defense, public safety, infrastructure and education. It is a system in which the top 10 percent of earners -- households making an average of $366,400 in 2006 -- paid about 73 percent of the income taxes collected by the federal government.

As much as I whine and cry about how corporations skip out on paying taxes and how the truly wealthy could probably pay up a bit more - I find these numbers to be outrageous.

At the risk of being very politically incorrect - if you are a family with a kid or two kids or more you need to be paying some taxes - I don't care if you make $50K or $20K or $10K. Your family uses benefits derived from taxation and definitely uses more resources proportionally to those without children. These people need to be paying something - even a couple hundred bucks is substantial in aggregate when you're talking about 47% of the population.

As I said - the wealthy and pretty well off should pay their share - but to have this other large subset of the population contributing NOTHING is beyond crazy...

No wonder this country is such a financial train wreck...

imo, what is needed is a reproduction tax, not the reproduction tax credit initiated by bush and co.

Elwood, we stray into the tall grasses here.

First of all, what you suggest would only be effective if the tax was administered prior to conception. How, exactly, do you suggest we do that in the U S of A? In China, maybe. Not here, at least not any time soon.

Secondly, if administered post partum, I am, and many others would be as well I am sure, very uncomfortable at reducing the ability of parents to feed their children. And that, simply stated, would happen with such a tax.

Of course we all know that ultimately it is more humane to impose your tax, since it theoretically dampens birth rates. It is still more than a hard call, and I don't see most nations imposing such a tax.

OTOH, we could encourage birth control. Maybe distribute condoms at no charge, offer low cost or no cost vasectomies, and so forth.

Just a thought...

deja vu


But what is not addressed is the huge increase, I believe in the Eighties, in the highly regressive Payroll Tax (for Social Security + Medicare). Until recently, the large surpluses generated by the Payroll Tax (and primarily paid by lower and middle income taxpayers) were used for general expenditures, but I believe that both Social Security and Medicare are now running annual cash flow deficits.

Of course, at various times, some government officials have argued that the Social Security Trust Fund has some kind of actual value, but of course the assets held by Social Security (part of the federal government) are matched dollar for dollar by the liabilities held by the Treasury Department (also part of the federal government).

It's also a lie.

Note that they are only talking about one tax, the Income Tax.

Sales tax, Payroll withholding for SS and Medicare, and other taxes take up a lot higher percantage of the taxes paid by the bottom half.

Thank you r4ndom. The myth that the poor pay no taxes because they aren't subject to Federal Income tax needs to be dispelled. Payroll taxes, sales tax, and in some states service tax, as a percentage, take up a good chunk of low income workers' checks.

Exactly. The Poor and Middle class pay heavily.. it's very easy to paint them (us) as freeloaders.

Instead of the 'Procreation tax' (I'm still chewing on that one..) but I think the implications of it would be amply covered by carbon-based-energy taxes. If you can feed your kids off your own farm, the costs of all the energy inputs shouldn't hit you.. but they would hit the 'overconsumption food chains' heavily, and reward economy and thrift.

Knock Wood.

Fuel and sales taxes on food tend to be regressive. Unemployment tax, and all other employer taxes paid for employees are really employee-paid taxes (they are a cost of employing, and are no different than salary). Often you pay state taxes too, and of course real-estate taxes (inciting all to buy, and overvaluing all properties, was a masterful boon for such taxes).

Not to mention that the lower capital gains tax, to 15%, from the 2003 tax cuts disproportionally helped the well off, since they own most of the investments. The low rate of capital gains in the lower income brackets to 5% is a smokescreen, since they actually don't own anything! Rather, most of their money goes to rent/mortgage and spending on daily living expenses.

Notice how these cuts conveniently expire this year - after Bush knew he would be out of office, and right when TSHTF was projected to occur. It's almost as if Bush was hell bent on giving one last givewaway to the rich and military-industrial complex before things begin to shut down.

The Republicans have been more or less successful in the decimation of the middle class, which is and always has been their goal. The poor are useful, because they can be bellboys and cooks and maids and never complain and always live in fear. The middle class - with their values of education, thrift, savings, productive work -and their sheer numbers were always a threat to the wealthy, and they have known this for a long time.

The end result - a society of haves and have nots - suits the rich just fine and is in fact what they desire. Although America would have arguably declined anyway, it's my opinion that even as late as 2000 we could have transitioned to a post capitalism society with emphasis on energy efficiency, education, health etc. The Bush years of 2000-2008 were definitive in finishing this country off, and the capital just isn't there to meaningfully change anything now.

My primary issue would be that having children shouldn't exempt you from taxes. Children are a luxury and should be subject to a luxury tax. Encouraging procreation is outmoded given world over population and resource availability reductions. We single people and empty nesters are getting screwed royally.

Considering the government is more worried about an "aging population" and funding their ponzi entitlements, they want as many young people as possible.

A growing base also allows for economic growth - economic growth allows for a fiat currency system to be run with minimal blowback.

And to Godwin the topic - helps boost the ranks of your soldier class.

Taxation is a pretty good deal for most of us.

I contend that it absolutely is not! Based on the fact that we have very little say as to how our tax dollars are actually spent. There are quite a few programs that I would not support if given the option. What was that thing about no taxation without representation...

This graphic of how that money is allocated is a bit dated but worth a look.

If you go there look at the "ginormous" link to see it in its full glory.

Personal electronic devices will be a priority even in a very deep depression. This can be shown by how mobile telephones are prioritized in very poor countries.

Internet is extremely usefull and has high demand cultural content...

I would not be at all suprised if the next generation of mobile telephones can attach a large screen and act as a cheap internet terminal.

I wonder if the Internet will that useful and entertaining once people begin losing the ability to pay for it.

There was an article awhile back about some YouTube-like sites that were blocking access from Africa and Asia. The reason? Huge demand for content, little ability to pay for it.

Pemex’s Crude Oil Production Falls 2% in March, Commission Says

Preliminary March output dropped to 2.599 million barrels a day from 2.652 million barrels in the year-earlier period, the commission said on its Web site in an oil exploration report dated April 4.

However that is only an 11,000 bp/d drop from February 2010.

Ron P.

I've played around with field data for Forties a bit, it being a similar field in respects. Peak was 1980 and in 1989 was at 41.62% of peak value, compared to Cantarell peaking in 2005 and being at 49.25% of peak in 2009. Forties dropped 15.99% in 1989 but declined more gently thereafter. If Cantarell had declined along the Forties pattern it would be producing about 550 kb/d more now. Imposing the post 1989 Forties pattern on Cantarell we would expect 850.91 kb/d in 2015, a decline of only 194.59 kb/d from 2009's 1045.5 kb/d. Dunno if that will save them from becoming a net importer. They seem to be down to about 800 kb/d of net at the moment, and the Forties pattern is likely too optimistic.

Wait, scratch that - had my X axis off by a year. 2009 average for Cantarell up to Nov was 638.7 kb/d, so figure 538.44 kb/d in 2015 if the field follows that gentle late period Forties decline.

Popular story at the BBC News website:
Petrol price hits record high

The average price of unleaded petrol has hit a new high of 119.9p a litre, analysts Experian Catalist have said.

Prices have been increasing steadily since the end of last year as the pound has weakened, which makes imported fuel more expensive.

The previous record was 119.7p, reached in July 2008 when the price of oil peaked at $147 a barrel.

well it is 121.9p at the local Shell station here.

I mentioned the other day how odd it is that there are no fuel protests. Back in 2001 when petrol crept above 80p per litre the hauliers blockaded the refineries and brought the country to a complete standstill. Now that same litre is half as much again and nothing!! Perhaps they've all been driven out of business already.

I have never understood these protests/blockades due to increased fuel costs -
Solution :How about just to pass on that "extra" cost onto your clients ? I mean what is the problem? All drivers, fishermen and what not need to pay that very same extra cost, no? An even playing field IMO.

I have never understood these protests/blockades due to increased fuel costs -
Solution :How about just to pass on that "extra" cost onto your clients ? I mean what is the problem? All drivers, fishermen and what not need to pay that very same extra cost, no? An even playing field IMO.

The problem in the UK was/is that European truckers came over to compete for British work but could get a tax rebate on their fuel and/or buy in Europe first. The UK truckers were stuck paying the UK tax at an unfair disadvantage. At least that was the gist of the protests, mainly over the tax not the price of oil per se.

Alright I get that point (partly), regarding the truckers. How is that issue solved today, is the problem gone away?
EU's "Four freedoms" are still around-

The free movement of goods;
The free movement of capital;
The free movement of services;
The free movement of persons;

Anyway, the French fishermen are a uniform group within France ... protesting/blockading to no avail just b/c of increased cost of fuel (2008 or so). As I see it they conform fairly well to "my solution" above, but still protests there are....

Every so often I hear on the UK radio complaints from British truckers, so I don't think the problem has gone away. As far as I can tell, the fact that relatively little happened as a result of the last lot of strikes (just a temporary postponement of a tax rise, not even an actual tax reduction) means that no-one has yet been motivated enough to try it again.

Incidentally, the other big component in the fuel protests was the farming lobby, who felt that they were doing "important work" that required a lot of driving. In that I consider generation of food more important than generation of, say, Barbie dolls, I have a little sympathy with that view, although I think there was heavy exaggeration of how much driving was genuinely work based rather than social. The thing that never made any logical sense to me was that they were agitating for decreased fuel taxation that would apply to all fuel being sold rather than something like a tax claimback for certain "socially important" industries.

If you want to weep for the species, check the latest blog entry at PetrolPrices.com and the comments. The blog has been dead for nearly a year, yet today saw more comments on the new petrol price record article than all previous comment sections combined.

A lot of ignorance and illogic abound.

Fish are considered as food. As the cost of fossil fuel intensive harvesting goes up, people will eat less fish. So in this case a big part of the "unfair" competition isn't foreign fishers, but rather other types of foodstuff. Now, as a society the overall good requires that the consumers see the full price of his fish (fossil fuels and all). But, people whose livelihood is threatened don't tend to be believers in comparative advantage.

How about just to pass on that "extra" cost onto your clients ? I mean what is the problem?

The problem, paal, is that their customers have a full plate. They cannot, literally "can" not, as in it is impossible to, absorb any price increase. If anything increases, they are forced to triage their spending. What is more important, fish or simply calories. The customers will have to go to cheaper calories, and the fishermen, from experience, know that to be the truth. Why else did they have the Church make Friday 'meatless,' and allow only fish? Since the Church has decided that meatless Fridays are no longer necessary to salvation, what is a poor fish monger to do?


ps: This analysis applies to almost any commodity or service. As costs from fossil fuels increase, it limits what individuals are able to consume. This drives down production, transportation, and of course demand for fuel. In turn, at least in theory, price of fuel will then drop until people are again able to afford it. Since price is also a function of EROEI, the conundrum is that a steadily decreasing supply, and at an increasingly low EROI, will be lowering economic production, step by step. Of course we will triage our use of fossil fuels; at some point, though, we will reach a level where we absolutely cannot continue to support the numbers of folks on the planet. Production of food will slow, transportation of food will become too expensive, and factory farming will pass into the twilight as mankind's numbers diminish to sustainability.

As the Archdruid said, it is sad that we live at the time when the bill must be paid. Would that we could but wish it away!


Craig- you are of course correct in all of your complex assessments and IT will end right there (!) where you imply it will end. The grand scale back has started in small but visible steps.. but yet only visible to them that "want to see".
And let it be said- whatever happens- my crave for Russian Caviar will not cease due to increased petrol- or transport costs, not for a second. I will just continue to still never have eaten it ... a little bit like that stupid virtual and fictive "oil demand curve" we see every now and then.

haven't seen this one posted:

"Jergens Center for Energy Forecasting Warns That Energy Information Agency Estimates for US Natural Gas Supply Are Likely off by over 1 Tcf in the Last Two Years"


Once again time to pull this old horse out and beat it to death again. Re: Dr Chu's great excitement regarding the huge increase in US NG reserves from the shale gas plays. Read the release and, as typical, very little meat to digest. And as I've said before, and I'm sure many are as tired of hearing it as I am, any offer of recoverable reserve that doesn't include a price assumption is meaningless. The statement doesn't even specify what his numbers are: economically recoverable or technologically recoverable. To make his statement even more confusing he ends with: "The reserves of natural gas that can be recovered from shale deposits using a drilling technique called hydraulic fracturing is "yet to be proven," Chu said." So he says we may have doubled the amount of NG recoverable in the US even though the recovery technique has yet to be proven.


Study: 1.2 million households lost to recession

The study also shed some light on what happens to the people in those "lost" households. It’s widely assumed that many who lose a home to foreclosure become renters. But since the recession began, there has been a five-fold increase in “overcrowding” of remaining households — defined as more than one person per room, according to the study.

That doubling-up is happening as families who lose their homes move in with friends or family. In other cases, younger people have delayed moving out on their own, instead staying with their parents until the economy improves. Others who fail to find work after graduating from college move back home.

The brother-in-law on the couch version of the apocalypse...

The brother-in-law on the couch version of the apocalypse...

Which may be the best reason for a small farm/garden. Instead of viewing unemployed in-laws and adult children as incoming liabilities, think of them as incoming farm labor.

... and most of those new farmers will be living on a couch in such surroundings

Isn't it like roughly 3/4 of all inhabitants in industrial countries that live in urban areas? Houston there is a ..... bep bep bep ....


If any of you are playing around with little (or big) contingency lists of 'what to do' and 'how to deal' .. you might come up with a list of projects and jobs to assign your expected new roommates, that would enable you and your household to make this transition possible.

-Adapt the basement or garage into an efficiency apartment (look to Freecycle for used appliances)
(IE, job one is they can make their own beds..)
-Insulate, or Super-Insulate.. all those jobs you haven't been able to get around to yet

-Build a HoopHouse for multi-season growing, or other food production preps. (Flat Roof? Maybe you can built it up top.. or at least have the parts ready. 'That's where the light is..')
Big Solar Oven/Crockpot setup, to make big batches of food for your growing dynasty.
Rabbit or Chicken Hutches..

PS, I liked the 'Chinese Greenhouse' article. The Modification I would add would be to make the north wall exterior into a set of divided 'hopper areas' where you could keep great mulch mounds that were right up against the reinforced building exterior, and so take advantage of the Mulching Heat for this greenhouse as well. There are plans out there by people who have put piping into their mulch piles and gotten the Domestic Hot Water from it, and Natural Gas, too.

Big Solar Oven/Crockpot setup, to make big batches of food for your growing dynasty.

In the solar cooking campfire (any my profile) there is references to sheffier dishes. Use one of them to put sunlight into a steam system, then you can pressure cook/can. Or, if you feel adventurous you can copy the oil based versions and then you'd have an oven.

That's a really good use of your bio. Gives a good sense of which themes you follow, favorite references, etc..

Didn't see the sheffier dishes.. was that the Heliostat articles? Definitely into the idea of a programmable Domestic Heliostat setup that can be retargeted and even 'split-targeted' as desired, ice melting, solar lighting, food dehydration, sauna heating, wood drying, baking etc...


That's a really good use of your bio.

Been doing it for a long time. I'd think that is what others would do, and the only way the resource becomes lost is after a ban-hammering.

Let me give some links.

http://www.solare-bruecke.org/projekte-Dateien/Solarsterilisator/summary english.html (pressure cooker really)
This like has a picture of the below system - what the dead links on my page
Solar Community Cooking System :
We have developed a Solar Concentrator type solar cooker (aperture area 8 sq. m.). This is an efficient design of solar cooker, where temperatures of over 300°C can be reached.

And here is a pressure cooker project. Thus allows you to cook/preserve food.

And for those who'd like to think that somehow the "leadership" has a clue I present:

(with lawmakers like these, who needs foes?)

Ian McEwan's new fictional book 'Solar' has multiple references to Peak Oil. Granted it's fiction but another step towards main stream media perhaps.

Elsewhere today's FT is all over the recent high oil prices:

Oil could give kiss of death to recovery

“You can’t have a global recovery without the oil price recovering as well,” says Lutz Kilian, a University of Michigan economist who has studied the effects of oil shocks. Because demand is fuelling prices, “the only way to keep oil prices down is to remain in a recession, which hardly sounds attractive”.

The prospect of higher prices is still alarming to many observers. Olivier Jakob, of Swiss consultant Petromatrix, said in a note that the “recovery of 2009 was fuelled with crude oil at $62 a barrel, not at $90 a barrel or $100 a barrel. We fear that the latest run on WTI will be the kiss of death for a global economy that was trying to avoid the possibility of a double-dip recession.”

When oil prices last surged to $100 a barrel in late 2007, US and other rich-country consumers blunted the impact by drawing on home-equity loans and credit cards to finance petrol purchases, says David Greely, energy economist at Goldman Sachs.

“It does raise the issue if we’re in a much more credit constrained world going forward, are consumers able to do that or will they be more sensitive?” he asks.

The Irish Times article put this idea very succinctly, I thought.

I'm eager to set up my little 'Solar HO Train' at our EarthDay festivities again this year, with various snippets to read about energy and environment relationships.. the following is from that article..

HERE’S A conundrum: restarting global economic growth will, by definition, push up energy costs. Rising energy costs will in turn choke off that economic recovery, leading to a fall in energy prices. Try to restart growth again, and the brick wall of energy costs magically reappears. Repeat ad infinitum.

It is hard to overstate the extent to which our daily lives are subsidised by cheap, plentiful oil. Every 24 hours, Ireland burns around 200,000 barrels. That’s the daily equivalent of the muscle power of 2.4 million men, each working for a full year.

Our entire way of life depends on abundant, inexpensive oil. This era is now drawing to a close. Five years ago, the Hirsch report published by the US department of energy concluded that the world has “never faced a problem” as difficult as peak oil, adding that: “without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary”. Oil peaking will be, it warned, “abrupt and revolutionary”.

Now, I added a parenthetical that the USA uses 20mbd to Ireland's .2mbd, and thus the equiv. of 240 million man-years of labor daily. Anyone know if the Oil>Work basis they used is reasonable?


Aack, if we need more cheap labor we'll just tear down the southern fence and import from Mexico (might even put billboards up!). They've given us most of their oil- now we can start importing people.

Efficiency is N.B.'s next energy resource

One of the most tantalizing ideas produced during the recent energy debate came not from legislators, but from the panel empowered to examine energy policy.

The advisory panel concluded that a strategic investment in efficiency would free up energy already being generated and reduce the need to build new power plants. The estimated cost of this electricity would be 4.5 to 4.7 cents per kilowatt-hour - a little less than half the retail price.


To get an idea of how substantial the savings can be, consider the projections in Nova Scotia. By 2018, Nova Scotia Power expects to save 2.3 terawatt-hours of electricity a year through efficiency - the equivalent of a new 400-megawatt power plant.

See: http://telegraphjournal.canadaeast.com/opinion/article/1007541

To put those 400 mega-watts into proper perspective, total provincial load as at 19h26 is 1,338.1 MW.


Meanwhile, one province over....

Hydro-Québec posts record income of almost $3.04 billion

MONTREAL ­­ Hydro-Québec posted a record income of almost $3.04 billion from continuing operations in 2009 despite strong recessionary headwinds that included less revenue from industrial sales in Quebec and a higher Canadian dollar.


With a strong grid – which will see $8-billion in improvements over the next five years - and low-cost hydroelectric power, Quebec is ideally suited to electric vehicles, Vandal said.

“In Quebec, it would now be seven times less expensive to run (vehicles) on electricity than on gas,” he said.

See: http://www.montrealgazette.com/business/Hydro+Qu%C3%A9bec+posts+record+i...


“In Quebec, it would now be seven times less expensive to run (vehicles) on electricity than on gas,” he said.

It might be nice to see regional adoption of more electric vehicles for areas like Quebec, if the statement is something actionable.

Even if electric cars are not the 'one size fits all' cure, it is my opinion that Quebec could benefit....

Re the Chinese coal carrier aground in the Great Barrier Reef Marine Park,the Australian Federal Police are now on the case.It will be interesting to see what,if any charges,come out of this and how they fare in the current political environment vis-a-vis China's "man" in Canberra,Prime Minister Rudd.

When the bunker oil is removed from the vessel,which is currently happening,attention will turn to getting the wreck refloated.This will be interesting,to say the least,with 65,000 tons of coal cargo plus the weight of the vessel this is not the average tow job.Lightening the ship by removing part or all of the coal would be a difficult if not impossible operation as there are no cranes on the ship.

The weather has been kind to date with light winds but that can't continue.The site is exposed to the oceanic swell.

And moving one more west....

Ont. announces $8B in renewable energy projects
Project aimed at creating 20,000 new jobs

In the province's latest green energy push, Ontario will award $8-billion to dozens of companies in its renewable energy efforts.


The entire project will create 20,000 new jobs across the province.

The projects are in addition to 510 medium-sized projects announced in March as part of the government's Green Energy Act's feed-in tariff program.


The projects will create almost 2,500 megawatts of renewable energy from wind, solar and run-of-river hydro projects, and generate enough energy to power 600,000 homes in the province, McGuinty said.

Seventy-six of the projects involve ground-mounted solar panels, 47 are onshore wind, 46 are waterpower and seven are biogas projects.

There are also two biomass and four landfill gas projects as well as a rooftop solar and offshore wind project.

See: http://www.cbc.ca/technology/story/2010/04/08/ontario-renewable-energy-d...



Also reported in the Globe and Mail, with a bit more detail...


including this
"The companies will receive a fixed price over 20 years for the electricity they produce – 13.5 cents a kilowatt hour for on-shore wind farms and up to 80.2 cents for solar power. These contracts with green power producers are well above the market price of 3.44 cents a kilowatt hour for electricity in Ontario and are leading to higher hydro bills for consumers."

I have no problem with paying a reasonable premium for green energy (basically, equivalent to a carbon tax), but 80c for solar power? What a waste of money - how is this any better than wind energy, or (small scale) biomass or micro hydro or waste heat etc etc? What is the average cost of your negawatts, probably cheaper still than wind?

The idea is to encourage practical, scalable green energy - this simply diverts money from other, more useful options, to the least useful one, in my opinion.

Or, put another way, it is a transfer of wealth to the people who can afford to put solar panels on their roofs, from the people who cannot. This madness has to end.

Hi Paul,

In terms of wind, a fixed, twenty year PPA at 13.5-cents per kWh seems fair, particularly if we're moving into an era of increasingly constrained supplies and higher inflation. The premium for solar is extraordinary high. However, a few years ago when Ontario was coping with a severe capacity shortfall, it was paying as much as $2.00 per kWh for imported power. Ontario is summer peaking and the electricity supplied by these solar facilities will presumably help minimize the need for expensive imports during the critical summer months (in winter, their output will be relatively low, so any impact on utility costs during these non-critical months would be negligible). Think of these as basically peaker plants.

Elsewhere, the Globe is reporting that this particular initiative will add about $5.00 per month to the average residential bill. On balance, that's not unreasonable if it helps the Province wean itself off coal. And whilst higher power costs are never welcome, they do help spur investments in energy efficiency and, as you know, there are certainly many opportunities to reduce demand given the right price signals. We also know that the most recent round of bids for nuclear power came in at just under $11,000.00 per kW, so as the current nuclear fleet wheezes its way into retirement, things are going to turn ugly in a big way; and when that day arrives, these early investments in renewable energy may turn out to be relative bargains.



I don't disagree that Ontario has some serious issues, to deal with, all self induced, of course. But it juts seems a misallocation of resources. Solar is the most expensive and has the shortest service life - any$ spent on solar could have bought 5x more capacity in wind, small hydro, etc, or, of course, conservation. On the the hot , cloudy, humid day, the AC is working hardest and the solar plants are only at part production. A single NG 500MW CCGT peaker plant + hundreds of wind turbines will give much better, and more controllable, results for same $ than solar.

I guess I just have a real problem with government trying to back winners with the people's money. I think it would be better to set clear rules, and things like a carbon tax, rules against new coal plants if so desired (BC has that). Basically, set up the system and then have utilities, IPP's, entrepreneurs, customers game it to achieve the results you want. Deregulation in the past did not work because they they wanted to maintain artificially low customer rates, and then private generators decided they did not want to play that game, and fair enough.

Investment decisions are indeed spurred on by price signals, and if this makes the best business decision now to do solar, what incentive is there to innovate on anything else? Germany and Spain are reducing their solar feed in tariffs because they weren't successful - it just created an industry totally dependent on the subsidy, and the inevitable painful contraction. Industry spent money building and installing existing technology instead of improving it. Government money should be trying to improve the industry, not making an inefficient one bigger.

They did at least get it right in putting the extra cost onto the electric customer, rather than the general taxpayer. They should go a step further and introduce seasonal and peak/off peak rates that reflect these costs. When customers realise that AC is an expensive luxury, not a cheap one, they may be more prudent in their use of it.

Hi Paul,

It's a tough one for me to call. My understanding is that wind production is generally strongest during the winter months and weakest during the dog days of summer (hot, humid, but relatively windless conditions). Small hydro production typically peaks during the spring and tapers off as the summer progresses, so it may not be the best fit either come July and August. And air conditioning loads will be presumably highest on sunny versus overcast days due to increased insolation, so solar would likely be the strongest of all three candidates during these periods of critical need.

The good news is that Ontario has a seasonal rate structure (the winter and summer rates kick in on November 1st and May 1st respectively) and they're pursuing energy efficiency quite aggressively. And having worked as a policy analyst with the Ontario Ministry of Energy's Electricity Section in a previous half-life, my guess is that these policies would have been thoroughly vetted by all parties concerned; not to suggest that mistakes aren't made or that some ideas are better than others, but I'm confident a number of eyeballs and red pencils were involved along the way and that the Government of Ontario would have acted with a reasonable measure of prudence. [OK, don't crack a rib laughing.]


I hope they have retained the reasonable measure of prudence, but how often does the elected government ignore the staff's advice? And they take NB approach, of wanting to assure everyone that their electricity supplies are secure, when this is not the case.

It just seems to me, that solar, and solar PV in particular, is just not a large scale alternative. Even just a 1kW array is very expensive, and will only partially displace a house's air con load, and for the rest of the year it's not as good as the alternatives.

I had though of something like the solar array must displace the entire AC system load, to get any subsidy, but even then, it means all the poor folks who can't afford AC are subsidising those who can.

I guess there just isn't an easy solution, or it would have been implemented.

Hi Paul,

I find myself in the awkward position of defending the Province when for so many years I've criticized their poor judgment with respect to energy efficiency (I was championing DSM in the early 80's when Ontario Hydro and its political masters were doing everything in their power to increase load). That said, is utility PV a good investment for Ontario? I'd have to do some serious legwork before I could honestly answer that, but for the time being, I'm willing to give them the benefit of the doubt. My uneducated guess is that their commitment to phase-out coal and a rapidly aging nuclear fleet have put them behind the eight ball and that they're aggressively pursuing a wide range of alternatives, including some that are rather costly at today's prices.