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Drumbeat: June 10, 2010
Posted by Leanan on June 10, 2010 - 10:05am
The Gulf Coast oil spill's Dr. Doom (interview with Matt Simmons)
What do you think is in store for the future of BP?They have about a month before they declare Chapter 11. They're going to run out of cash from lawsuits, cleanup and other expenses. One really smart thing that Obama did was about three weeks ago he forced BP CEO Tony Hayward to put in writing that BP would pay for every dollar of the cleanup. But there isn't enough money in the world to clean up the Gulf of Mexico. Once BP realizes the extent of this my guess is that they'll panic and go into Chapter 11.
BP's Shares Plunge on Spill Liability Fears
BP's New York-traded shares headed sharply lower at about 1:30 p.m. EDT (1730 GMT), after an article appeared on Fortune magazine's website quoting high-profile oil analyst Matthew Simmons, who raised questions about the company's liability for the oil spill and its ability to survive the crisis.
PetroChina May Gain From Acquiring BP, StanChart Says
(Bloomberg) -- PetroChina Co., vying with Exxon Mobil Corp. as the world’s biggest company by value, would have “persuasive” reasons to seek a takeover of BP Plc, according to Standard Chartered Bank.
Has US bloodlust at BP gone too far?
With something close to relish, financial pundits are mooting a BP bankruptcy. A New York Times columnist, Andrew Ross Sorkin, guessed that the cost of the gulf disaster could reach a staggering $40bn (£27bn), making corporate collapse a real possibility (calmer industry experts put the cost at $5bn to $15bn). A prominent, albeit retired, oil analyst, Matthew Simmons, has been touring television studios to declare that the oil spill was "entirely BP's fault" and that the company will be bust within months. Predictions of doom are self-perpetuating in business and BP's stock price has duly plummeted by 40%. The company's market value has fallen by nearly £50bn, even though BP makes a profit of more than £11bn annually.
UK government says ready to help BP over spill
(Reuters) - Prime Minister David Cameron said on Thursday that the British government stood ready to help BP (BP.L) with its clean up efforts following the Gulf of Mexico oil spill.
Obama Scolding BP on Dividend Favors Fishermen Over Retirees
(Bloomberg) -- Miriam Sullivan may lose about $10,000 a year of her retirement income if BP Plc suspends its dividend because of the Gulf of Mexico oil spill.“It’s a nice amount of money to have coming in,” said Sullivan, the 74-year-old wife of a retired schoolteacher in Haddonfield, New Jersey, and one of the 39 percent of BP shareholders who live in the U.S. “They’re penalizing people that are innocent by cutting the dividend at this point, when they don’t even need to. It seems very political.”
Chaos in the Gulf Has Only Just Begun
Little attention has been paid to other companies dunked in the soup by the BP mess. As you know, President Obama has slapped a six-month moratorium on gulf drilling at depths in excess of 500 feet, idling 33 deepwater-capable rigs in various stages of exploration or production.But did you know that fully five of those rigs were being operated by Royal Dutch Shell? And if that weren't enough, along with the gulf pullback, the feds have put at least a temporary kibosh on Shell's plans to spend most of this summer drilling five exploratory wells in the Beaufort and Chukchi seas off Alaska.
Mary Landry Sees Game Changer as Oil Awaits Atlantic Hurricanes
(Bloomberg) -- Coast Guard Rear Admiral Mary E. Landry was up early on Saturday, April 24, preparing to brief news reporters on the deadly explosion at the Deepwater Horizon drilling rig when BP Plc called with bad news: The well was leaking oil into the Gulf of Mexico, 5,000 feet below the surface.She dashed off an e-mail to inform several admirals about the leak that was destined to become the biggest offshore oil spill in U.S. history. In the subject line she typed, “GAME CHANGER.”
Coast Guard Toughens Oversight of BP’s Effort
With oil continuing to leak Wednesday from a runaway well in the Gulf of Mexico despite BP’s success in capturing some of the flow, a top Coast Guard official ordered the company to come up with a plan “to ensure that the remaining oil and gas flowing can be recovered.”
Gulf disaster 'a game-changer'
The Gulf of Mexico oil spill is a potential "game changer" for oil supply, which could restrict future subsea oil development and limit supply, the International Energy Agency (IEA) said today.The disaster at the Macondo wellsite, in BP-operated Mississippi Canyon Block 252, would raise costs, delay new projects and bring a thorough review of offshore regulation, the IEA said.
"April's sinking of the Deepwater Horizon drilling rig and the ongoing oil spill might ... prove to be a supply-side game changer," the IEA said in its monthly Oil Market Report.
"Costs are going to go up, projects are going to be delayed and some sort of regulatory overhaul is likely in the United States in the aftermath of this terrible accident," David Fyfe, head of the IEA's oil industry and markets division, told Reuters Insider television.
Fyfe said the spill had "the potential to change the dynamic on the supply side of the equation" in the oil market.
Poll: Support plunges for offshore drilling; regulators blamed for Gulf spill
Just a quarter of Americans back expanding offshore drilling in the wake of the BP oil spill, and most fault federal regulators for the environmental disaster in the Gulf of Mexico, according to a new Washington Post-ABC News poll.Before the spill, the Obama administration lifted the moratorium on drilling in U.S. coastal waters as a way to address the country's energy needs. But most Americans now want fewer offshore wells (31 percent) or the amount kept at current levels (41 percent).
Perhaps as a consequence of the spill, public support for oil and gas drilling in general is also significantly lower than it was a year ago. And as Americans have become increasingly skeptical about such exploration, some elected representatives are now questioning what the government is doing to ensure that offshore exploration can take place safely.
The new oil risk: peak regulation
The regulatory system totally failed. Let's try more regulation. We've seen this pattern before, and we're about to see it all again in the oil industry. In the wake of the Gulf of Mexico disaster, governments all over the world, led by U.S. President Barack Obama, are now gearing up thousand-page rule books and new bureaucracies to oversee the global oil industry. Canada and Norway have already imposed curbs on deep water and Arctic exploration.The result is certain to be declining reserves of oil around the world, reduced supply and messed-up markets. Much as many people would like to believe that fossil fuels are a filthy nuisance that can be replaced by wind, sun and other forms of green energy, the fact is that the world's people are increasingly dependent on oil and will continue to be for decades to come.
'Bow down to Peak Oil!' says BBC's Cthulu-worshipping Newsnight
Yesterday on the BBC’s flagship news analysis programme Newsnight Britain’s gravest, most distinguished and hard-hitting political interviewer Jeremy Paxman asked the vital questions an eager world most wants to hear: Cthulu – Are we worshipping him enough? Will it be necessary to sacrifice our children to appease him? Or will he be content if we just all erect a shrine to him, perhaps involving candles and teddy bears and Jo Malone scented oils?No, it wasn’t really Cthulu that Britain’s gravest, most distinguished and hard-hitting political interviewer was addressing but something just as warped and obsessive – and undoubtedly a lot more dangerous: the cult of Peak Oil.
Bill McKibben: Missing the Real Drama of the Deepwater Horizon Blowout
When a well started spewing oil off Santa Barbara in 1969, it spurred the first Earth Day, which in turn launched the environmental movement and a fundamental questioning of the balance between humans and the rest of nature. It turned out, in other words, to be a real Moment.It makes one wonder if there really shouldn't be a little more depth to the endless coverage of the Deepwater Horizon blowout in the Gulf. (Which, just to be semantic for a moment, isn't really a "spill," or a "leak," unless you'd also call a knife wound a "bloodspill," or a gunshot to the carotid a "bloodleak." BP has punched a hole in the bottom of the sea.)
Never let a good oil spill go to waste
NEW YORK (CNNMoney.com) -- Never let a good crisis go to waste.That's paraphrasing White House Chief of Staff Rahm Emanuel's supposed argument for sweeping reforms to the American economy amid the meltdown.
Now many say lawmakers are doing just that with the oil spill: failing to enact sweeping energy reform to wean the nation off fossil fuels while the public is fixated on events in the Gulf.
The lessons of the Gulf of Mexico crisis
Could it happen here? The environmental disaster that followed the blow-out of the Deepwater Horizon rig in the Gulf of Mexico has shown that deep-water drilling is indeed a hazardous activity. Perhaps for too long we have taken for granted the extraordinary achievement that is the North Sea project. Forty years ago, when a startled nation first became aware that the UK might be on the verge of an oil bonanza, it was seen as one of the great engineering wonders of the world; never before had oil been extracted from such inhospitable surroundings.
The Strange Case of Station 01
When the government and university researchers confirmed the existence of underwater plumes, or layers of dispersed oil in the Gulf of Mexico, on Tuesday, their report included a puzzling piece of information.
Bayou’s 232-Year-Old Isleno Culture Threatened by BP Oil Spill
(Bloomberg) -- Louis Molero says the oil he’s fighting in the marshes of Louisiana’s St. Bernard Parish threatens his home, his livelihood and the survival of a bayou culture that’s one of a kind.Molero, 47, is an oysterman and an Isleno, a descendent of Spanish-speaking Canary Islanders who came to Louisiana beginning in 1778. Hurricane Katrina destroyed all but a few of the parish’s 27,000 homes, scattering the residents. Now those who returned face an economic disaster from the BP Plc spill that may be more devastating, he said.
James Hamilton: How The Oil Spill Is A Replay Of The Subprime Crisis
In some ways the Gulf of Mexico oil spill seems like a replay of the subprime lending disaster. Clever technological innovations blew up in a mess that nobody knew how to control, wreaking devastation on those innocently standing by. The actors and the scenes have changed, but you can't shake the feeling you've been through this nightmare before.
It's time for progressives to rethink their messaging on climate change and America's use of fossil fuels.
World needs Gulf of Mexico's oil, says BP
Oil production in the Gulf of Mexico has become a much more significant part of meeting the world's energy needs, raising the stakes for decisions on the future of deep-water drilling in the region in the wake of the biggest oil spill in history.
BP, the embattled oil giant, on Wednesday launched its BP Statistical Review of World Energy 2010, in which it announced that the global recession drove energy demand lower in 2009 than the previous year, the first such decline since 1982, as the world economy contracted for the first time since the Second World War. Global reserves are sufficient to meet 2009 production for 45.7 years.
IEA Raises 2010 World Oil Demand Estimate on Recovery
(Bloomberg) -- The International Energy Agency raised its forecast for global oil demand this year as economic recovery in the U.S. bolstered fuel consumption, and increased its outlook for supplies from outside OPEC.Worldwide oil use will rise by 1.7 million barrels a day, or 2 percent, in 2010 to a record 86.4 million barrels, the Paris-based agency said in its monthly market report today. The increase of 60,000 barrels from last month’s estimate is driven by an acceleration in North American demand. The IEA bolstered its projection for supplies from outside the Organization of Petroleum Exporting Countries by 65,000 barrels a day.
Peak oil is blowin’ in the wind
There are people on YouTube who believe peak oil has already arrived. Yet, in their annual reports, many oil companies continue to state every year that they are finding at least as much oil as they are producing. If you believe such data, reserve bases aren’t shrinking and peak oil could even be receding.
Six years of data show that global production of oil started to plateau in 2005. But there are other ways to measure the world’s faltering ability to increase oil supply. We can show the increase in cost structure, as the capital required to bring on the new barrel rises. We can show the decline rates from existing fields. We can quantify how much oil comes from expensive, technically challenging fields such as tar sands or global offshore. And, we can also show oil’s share as a percentage of total world energy consumption.Given that the annual BP Statistical Review was released yesterday, I made up the following chart to show oil’s contribution to world energy use, on a BTU basis:
Crude Oil Futures Rise in New York, Trade Near Two-Week High
(Bloomberg) -- Oil rose to trade near a two-week high in New York as the dollar weakened and the International Energy Agency raised its demand forecast.
Saudi Aramco to Supply Full July Oil Volumes to Asia
(Bloomberg) -- Saudi Arabian Oil Co., the world’s largest state-owned oil company, will supply full contractual volumes of crude to Asia for loading in July as prices remain within its preferred range.Saudi Aramco, as the company is known, will provide 100 percent of cargoes sold under long-term contracts for an eighth month, according to a survey of three refinery officials in Japan and one in China, all of whom asked to remain unidentified, citing confidentiality agreements with the Middle East producer.
Qatar, Russia Shutter Gas Supply as Prices Sag
(Bloomberg) -- Qatar, the world’s largest producer of liquefied natural gas, will idle 66 percent of its export plants this year, reversing earlier plans and joining Russia in curtailing supply amid a global glut.
China does another big energy deal in the global fight for resources
Will there be any oil and gas left for the West by the time the Chinese have finished buying it all up? Richard Orange, our correspondent in Central Asia, alerts us to this announcement that China is buying another 10 billion cubic metres of gas a year from Uzbekistan.
Nigeria militants say clash with army in oil delta
(Reuters) - Nigeria's main militant group said its fighters clashed with soldiers in the creeks of Delta state in the oil-producing Niger Delta on Thursday, the first report of such unrest in the OPEC member nation in months.
UN sanctions 'won't hit Iran pipe plan'
The $.7.6 billion Iran-Pakistan gas pipeline will not be hit by fresh United Nations sanctions imposed against Tehran, Pakistan's Foreign Ministry said today.
Arab states: Israel blocking Mideast from becoming nukes-free
Arab countries singled out Israel at the International Atomic Energy Agency on Thursday for blocking the establishment of a Middle Eastern zone free of nuclear arms, at the first IAEA board meeting since 1991 to deal with Israel.
Funding crisis for nuclear fusion project ITER
A multi-billion euro international research project has run into deep financial trouble as EU governments scramble to find money to meet spiralling costs. However, with European credibility at stake, officials say there is no question of abandoning the project despite the yawning funding gaps.
Local tracks are motorsports meccas for thousands of fans
Remember, this summer, that life is short. So make a trip to the pump and fill ’er up. Then drive out of town and get out and cheer your head off for a bunch of daredevils racing in circles for little more than the sheer fun of it. It’s a guilty pleasure that will give you memories that’ll last a lifetime.And those memories will be all the more special once we pass peak oil, and start driving around in strange looking vehicles powered by the sun.
Avoiding Environmental Disaster through Sustainable Accessibility
Yesterday in my post about sustainable accessibility, I included a link to this lecture by Dr. John Sterman. The lecture, part of MIT’s series of seminars about transportation, provides a great introduction to the concept of accessibility as an alternative way to consider transportation system design.To design a sustainable and successful accessibility system, Sterman says, we need research across areas, including technical innovation; policy and business practices (i.e. new business models, policies, economic issues, price externalities that are currently not priced at all); and human behavior (i.e. taking full account of idiosyncrasies and irrational aspects of human behavior). All of this must be integrated.
I'm impressed by her point that it's normal for people to use times of plenty to prepare for lean times, because people with historical memory know that good times never last -- but we find ourselves in a culture in which people who wish to do that, and to encourage their neighbors to do that, find themselves associated with crazies who expect the Apocalypse. Do those people exist? Sure they do. But how representative are they of the "transition" community? Anyway, it's a neat trick how, if we can associate self-sufficiency, responsibility, thrift and sustainability with wackadoodlism, we don't have to change a thing about the way we live today, because who wants to be like those nutters? Let's just keep going as we are, and wait for science to save our bacon.
The Best And Worst Of Times For China's Environment
There's great progress afoot. Just don't breath the air or drink the water.
Carriers Criticize German Air Fare Tax
BERLIN — Germany’s plan to introduce an environmental tax of 1 billion euros a year on air travel tickets met with fierce resistance on Tuesday from airlines, which accused Berlin of making a shortsighted “cash grab” at the expense of an industry still struggling to return to profitability.
A Clash in Texas Over Air Pollution
HOUSTON — For 16 years, a showdown has been brewing between Texas and federal environmental officials over the state’s unique way of regulating industrial air pollution, which many critics complain is lax and has led to some of the dirtiest air in the country.Now, President Obama’s new regional director of the Environmental Protection Agency in Dallas has forced the issue. The new environmental sheriff is Al Armendariz, a 40-year-old chemical engineer from El Paso, and two weeks ago, he took the unprecedented step of barring Texas from issuing an operating permit to a refinery in Corpus Christi.
US senator offers scaled-back climate bill
WASHINGTON (AFP) – A Republican senator Wednesday offered a scaled-back plan to fight global warming, saying it was politically unrealistic for the United States to mandate cuts on carbon emissions in tough economic times.The proposal by Senator Richard Lugar would not create a "cap-and-trade" system requiring curbs in carbon -- a signature part of European efforts and a Democratic-led bill backed by President Barack Obama.
Senate votes on blocking EPA greenhouse gas regs
WASHINGTON – In the absence of congressional action on climate change, the Senate is heading toward a much-watched vote on whether the Obama administration should be allowed to go ahead with regulations curtailing greenhouse gas emissions from power plants and other major polluters.
Legally Binding Climate Deal Likely in 2011, UN’S De Boer Says
(Bloomberg) -- An international treaty to fight climate change is likely to take shape during United Nations talks in December and be completed a year later, the UN’s top climate official Yvo de Boer said.
Global warming spells doom for Asia's rivers
BEIJING (AFP) - The livelihood of thousands of Tibetans living on China's highest plateau is under threat as global warming and environmental degradation dry up water sources for three mighty Asian rivers, experts say.Dwindling glaciers and melting permafrost in the mountains surrounding the fragile Qinghai-Tibet plateau are leading to erosion of grasslands and wetlands, threatening the watershed of the Yangtze, Yellow and Mekong rivers.
One prominent US environmental campaigner has even warned that the looming water crisis could trigger a major regional food shortage, as the rivers help irrigate vast wheat fields and rice paddies in China and southeast Asia.
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Regarding Petrochina's acquisition of BP and the article quoting "political opposition" in the US and UK never forget "the borrower is slave to the lender".
FF
Also, never forget that when you owe the bank $10,000, YOU have a problem; When you owe the bank $650 million the bank has a problem.
I don't really see that our debt to China gives them much realpolitic-style clout.
If they suddenly began selling their bonds... that would be a catastrophe in the bond market and around the globe. They DO have leverage! This does not just affect us. It affects the entire world financial system. And it's connected with oil. It's all interconnected....
And the crash in the bond market affects China too. I don't think the CHinese would destroy the value of one of their own assets (their stockpile of US bonds) in a fit of pique over an ownership stake in an oil company.
Both sides have plenty of levers to play hardball with the other.
And on a broader level, I don't see an individual nation's control of oil being that significant anymore. Granted, I don't think I've seen many world leaders realize that. They still act like it matters, but the major economies are so interconnected I don't think there is any possible way you can insulate yourself from pain.
In a nutshell, I'd say that even if the US controlled all the oil--and made sure that it came to our shores and kept our tank reading "FULL" we'd still be boned high and dry in terms of standard of living--too much of our stuff comes from somewhere else if we don't miss the oil, we'll miss the other imports. I don't see anyway to escape that. But conversely the same applies to China, or India, or fill in the blank....Selling everything they make to the US is pretty much vital to the Chinese. If their biggest customer falls apart and can no longer buy their stuff, they become another bankrupt manufacturer.
put another way: the modern standard of living doesn't depend on our access to cheap energy--it depends on EVERYBODY'S access to cheap energy.
The fact that everyone in power knows, but doesn't say , is that the US would simply not honor the bonds if China tried to 'dump' them. They would institute capital controls and that would be the end of it. China is in the ultimate dollar trap and the US Navy controls the world's shipping lanes.
How can they "not honor the bonds to China"? These bonds were publicly sold ALL OVER THE WORLD! That would affect investors everywhere! Americans would rise up and protest! Mutual funds own these bonds too. Mutual funds here and around the globe. Yes, China owns gobs of them. But China is NOT the sole bond-holder.
How in the heck do you imagine they can default only on China?
Mind you, I am no economist. But as others have concurred above, these things are so interconnected now. Nations have got to cooperate. They can't unilaterally default - especially ONLY to one "holder". To my mind, that is nonsense. It would take a lot to convince me otherwise.
We are in a crisis situation at this moment. Nations (and all of us) have got to cooperate on many levels simultaneously. Or we will take everyone - at the same time - down - together!
This belief was widespread towards the end of the last experiment with globalization, in the years before World War I. It took more than 25 years after the war to start globalization again, with the GATT.
Faith in rational self-interest was misplaced then. There's no reason to think this time is different.
gregvp, similar thesis is presented in Niall Ferguson's epic series, the War of the Worlds,
http://www.youtube.com/watch?v=vP_X7cb-gwU&feature=related
The world was well on the way to globalization prior to World War I. The violence, racial profiling, and jostling for influence throughout the twentieth century impeded it progress.
A lot died with the Great War of 1914-1918, not just people, but also hopes and ideals and European hegemony.
Here is what would be involved if China came the U.S. and demanded that it's bonds be paid off:
The Fed would debit China's Treasury bond account (which exists only as an electronic record at the Fed).
It would then credit China's reserve account by the same amount.
That's it. It doens't have to "get the money". It's the exact same process that your bank does when you transfer money from your savings account to your checking account.
So let's not hyperventilate too much, huh?
The US navy does not control the world's shipping lanes, if it was in control why are there still pirates active in the world?
I agree that the US Navy is strong, but it is not all powerful. Right now it is spread rather thin, people still want to cut it to the point that in the future the pirates will be the strong ones and the US will be all the more weaker because of it.
Just wait till an Ocean liner full of people gets hijacked by pirates, then you'll see the mess we have put ourselves into with the slash and burn of the world's navies and coastal fleets.
It is a big ocean out there, and it always has been, so go ahead and slash and burn the military and then gripe about the pirates afterwards. High Seas crime waves are still in the baby stages now, wait till they think no one can stop them!
Charles,
BioWebScape designs for a better fed and housed future, without many pirates, even the ones on film.
Hugs from Arkansas,
Frankly, if you are worried about saving lives, I suggest we get a higher return on our dollars if we spent our money on some of our highways where 40,000 Americans die every year.
Somehow we can find a way to spend close to a trillion a year on the military, more than the next ten nations combined, and we can't seem to find enough money to maintain our roads and bridges.
And apparently we can't find enough money to protect our coastlines from oil spills or from levees susceptible to hurricanes.
The death via roads is because they are driving cars in the first place. If everyone walked, the death rate might be less or it might be greater, depends on what the cause of death is.
Speed kills, high speed can kill faster, but bad driving kills faster than both.
We'd need to find out how many people died in the 1850's due to horse related deaths on the roads of america to get a really good relationship going on death on the freeways of the future, due to high speed horse and wagon accidents.
The roads are about as good as you can expect with the sheer number of miles that have to be maintained, in all the weather conditions that they have to be maintained at, and the work that goes into building them. Look at German roads where they are thicker and have some places still allow high speeds to travel on them in certain conditions.
It does seem that I-40 through Memphis is always being worked on though. And a few other roads in the state can't be maintained because of wash outs all the time. I guess that is what we get for having failed to get transporters up and running ala Star Trek.
Sorry but protecting a coastline from the ocean is like asking not to get wet while standing out in a rain storm. Coastlines erode due to wave action, it is us who are at fault for building on shifting sand in this case. And stopping damage of hurricanes is like stopping a rain shower from making your sidewalk wet. Not something that you or anyone else can do much about, ever. Why throw money in a sinking hole?
Charles,
BioWebScape designs for a better fed and housed future.
Hugs from a wet Arkansas.
Charles,
The disconnect between the US Navy's wants and its future budget, even under optimistic assumptions, is vast.
The USN's planned SSBN-X (Ohio-class SSBN replacment) is estimated to come in at 70-100 Billion dollars for as few as 12 boats. The 50-year O&M costs are not included in this figure. Continuing manufacturing of the D-5 SLBM, then the Enhanced D-5, then the D-5 replacement (E-6?) will be scores and scores of billions more.
The USN is being committed to providing mobile IRBM and perhaps ICBM defenses using enhanced AN/SPY-1 radars and Standard SM-3+ missiles on Arleigh Burke DDGs and Ticonderoga CGs.
The USN is also trying to buy 50-some Littoral Combat Ships (LCS) to conduct ops near the shorelines.
Meanwhile, the attack boat tribe is bemoaning how our SSN boats will bottom out at 39 boats in the mid-twenties and how this is woefully insufficient to handle all the possible challenges...
We are now embarking on building the Gerald Ford class of nuclear carriers to replace the Nimitz class over the next couple of decades...and equip all the carriers with F-35 Lightning IIs (which are now officially twice their original spec'd cost per unit!) and various UAVs.
My point is: We don't have the money for half these ships...remember that the USAF, MArines, and US Army are all competing for a flat defense budget from here on out...and then there is the little-mentioned budget for overhead capabilities, cyber-warfare, etc.
If we need to screen sea lanes of pirates, then we need that kind of Navy. What we cannot afford is a Navy scoped to do every conceivable mission, against all manner of threats and scenarios, both plausible and implausible.
We need to focus our efforts, and live within our means.
And give up our pretensions of being the World's policeman.
And add a surcharge to all goods shipped to and from the U.S. to cover the costs of USN escort.
The salad days (according to some, anyway) are coming to an end...good riddance!
Just goes to show you why you need to elect me as your next president.
Cost overruns are a sad way of doing business, and should be fixed from the ground up. But getting the fix in, has been a standard mode of operation in the business world of the USA for a while, likely longer than most of us have been alive.
Too many things that us armchair politicians and policy makers don't know, and too many things we know that they won't listen to us about.
Who in DC has to see the homeless when they go to work, or see them where they live, or see them while helping out at the local food pantries? How many DC folks even know about homelessness in america? How many even care about it?
Lots of little things that DC does not even see going on in their world today.
Let alone trying to be the world's policemen.
Charles,
BioWebScape designs for a better fed and housed future.
Hugs from Arkansas.
If China dumps its trillion dollars of U.S. Treasuries onto the open market in the morning, by midafternoon of the same day the Federal Reserve System would buy up a trillion dollars of U.S. Treasuries through Open Market Operations, the main tool of monetary policy. The Fed can act very fast, as it did when the stock market dropped almost 25% in one day back in October 1987.
Be happy. Don't worry. It will probably be a Long Descent as described by John Michael Greer in his book of that title.
If there are no consequences why don't the US and China do a deal?
The Chinese like U.S. dollar Treasuries. The yuan is greatly undervalued compared to the dollar. (By the way, this issue is causing considerable friction in international financial relations between China and the United States.) The Chinese want to keep the yuan ridiculously cheap so that their exports are cheap. The United States claims that pegging the yuan to the dollar is an unfair trade practice, and the U.S. is threatening to impose punitive tariffs on Chinese imports so long as China refuses to devalue the yuan.
I came up with a simulation exercise that illustrates the Hubbert peak, also known as the logistic curve, from a set of non-Logistic curves. The core of the simulation uses the Dispersive Discovery model algorithm:
http://mobjectivist.blogspot.com/2010/06/oil-discovery-simulation-realit...
The simulation fits on a Google spreadsheet showing how 250 prospectors exploring their own dedicated private volume can generate a symmetric curve:
Google spreadsheet of Dispersive Discovery simulation
This is tailor-made for TOD as I used names of TOD editors and commenters to keep track of the prospecting entities. The result isn't perfect yet because Google spreadsheets are a bit unwieldy when it comes to doing something like this. If it is working properly, it will generate a different outcome each time the spreadsheet is loaded.
Lots of new people coming on to TOD and few people understand that an intuitive framework for peak oil exists. This places the Hubbert curve in tangible terms, where you can see how the aggregation of a set of prospectors naturally leads to what Hubbert suggested years ago, but could never derive correctly. The big intuitive sticking point that people struggling to understand the peak concept had to do with the necessary inclusion of a feedback mechanism to cause the decline. No feedback required here, as the model only requires randomness in the form of entropy.
Impressive. Love to see self organizing patterns emerge from the apparent chaos of data.
Ironically, I've been working on a low head hydro generation concept requiring 12 stations with 20 generators each for a certain unnamed river in BC. If I had any say in naming the generators, I thought one plant would have the names of the TOD principals for each unit. "Okay, we've got an alarm. I'm going into Gail now to check it out"; "Leanan is acting up again, vibration is too high"; or, "Is Nate shut down? Again! Nate is always shutting down". Hmmm, maybe not, its seems a little creepy.
But, I'll still use my favorite for naming computers on networks, The Flintstones. If you come across a computer named Bam-bam, chances are I was there.
In light of the what most know on this site, and some of the press lately, I think we are going through the stages as described by Gandhi. Right now somewhere in between "they laugh at you" and "they fight you". Hopefully winning is just around the corner.
I recall adding your name to the set BC_EE.
Chaos versus entropy always gets argued. Often it is hard to separate the two just by observations. I can tell you that no self-organization is occurring with this data. The only interesting feature is that the results do get more noisy the farther along the curve you go. That is because gradually the regions get self-selected out (i.e. "shut-in") and we are left with fewer to contribute to the statistics. And because of the law-of-large numbers, the fluctuations become more apparent. We may yet see this if we haven't already in the real data. It will be apparent as the occasional "gray swan" or "black swan" that gets reported. That is also why it is so important to do these kinds of simulations -- so you know what to expect in the real world.
Saw it in there WHT, it made my day. I was generalizing with the self organizing statement, obviously there was some grey matter involved. It's just when you look at the data field and out of it comes the good ol' distribution, it seems as if all is right in the universe.
As I said before, I'm not the best at mathematics; or it could be said I'm a bit of a high functioning autistic in some areas. Put me in the frequency domain and I'm a happy camper. Sounds kind of weird for a guy that is working primarily in power systems these days, but control theory, convolution, and dynamic systems modeling were some of my better ones. Most of all, I'm a great synthesizer.
I'll never win a Nobel Prize for some theory, but I think I'll leave behind a few legacies that have improved the life of a few people. What I want to get out of your work is to understand it at a lower level, or at least simplify the language a bit so I can latch onto the theorems. You're pretty good at the analogies and wit, and that goes a long way. I do this when instructing people and my favourite is calculus.
O-o-o-hh, big scary CALCULUS! I saw this demonstration and use it to this day. I toss a ball to someone and (hopefully) they catch it. There, your brain just did calculus. Bringing it home to something real and tangible is the secret sauce in education as far as I'm concerned. I would rather spend time going over a small solution that brings it home time and again to the point where people start to understand it viscerally than try and get through grandiose subjects and the minutiae of onerous calculation (until required, it can't be avoided sometimes). This is what makes Dr. A. Bartlett's lecture so successful. I recommend it to many.
No calculus involved in the simulation except for yearly discoveries defined as the derivative of the cumulative. And we should all understand that concept.
That's what makes this approach so intuitively appealling -- the lack of complicated math. Each cell in the spreadsheet contains a single conditional, testing whether the cumulative discovery is above a value.
Once upon a time, a long, long time ago, there were two VAXes: a larger 8800 ("Full DEC") and its smaller sibling, a MicroVAX II, affectionately known as "Half DEC". Gosh, I wish I could have played with a Full DEC.
Cheers,
Paul
And Paul, to continue from the discussion with WHT above, a little saying I came up with on the spot while analyzing and troubleshooting a network when arriving in Jacksonville, FL - as the supervisors were standing in my door anxious to get some solution and stability. "I'm trying to be a rifle and not a shotgun."
That worked. The problem is they were trying to solve all problems at once and I focused on each one as I found it and resolved it. After about two months on the site I remember one Monday morning when we showed up for work. I asked the team if they noticed anything on the weekend. They all gave the usual "No, nothing I can think of look". I said, "You're pagers didn't go off". Well, you should have seen the look on their faces. That's why I love the Ed Harris line in Apollo 13, "Work the problem people".
Negative space can be as powerful, or more than positive space.
I have some energy efficiency topics to discuss as we are entering into studies and capital projects here in BC. Um, just in case anyone is confused, I do power systems, transmission, P&C, telecom and broadband (built one of the first in Canada with Cisco's help), energy systems and energy efficiency studies - and I make a mean guacamole. This drives some of my American colleagues crazy because they are so pigeon-holed down there.
Best of luck, BC_EE, with your upcoming efficiency initiatives... I'll be pulling for ya.
I've been experiencing a good deal of work related stress lately -- earlier this week our monthly targets were tripled (and they have been creeping upward for sometime now); there are chronic material shortages that are severely hampering our operations; and we're about to move to an new web-based project management system that was unveiled to us earlier this morning (bangs head repeatedly on desk). There's more, but I'm sure you get the picture. On the plus side, I genuinely love what I do and I'm extremely proud of our crews and the way they conduct themselves. I'm also not afraid to laugh and kid about (mostly at my own expense), and to give thanks and praise in liberal doses -- and mean it. All in all, I consider myself a pretty lucky guy.
Cheers,
Paul
Ditto to BC_EE. And best of luck to you, too, Paul.
Maybe instead of a coffee we'll go for a beer. Although now that they've tripled your targets finding time will be the challenge. Good luck and godspeed with the workload.
Talk soon,
Tom
Thanks, Tom. A Keiths or Moose sounds pretty good about now, but it's off to bed we go (and given that it's now 02h00, you should do the same).
Cheers,
Paul
Reminds me of a time many moons ago when I was doing graphics work for a very anal retentive art director. I was working on a mixed Mac and Windows network and he wanted us to name our shared hard drives, I hadn't given mine a descriptive name yet and it was still showing up as HD, he was quite displeased with this and let me know in front of the entire team... next day my hardrive was sporting a new name, "Drosophila Melanogaster", He didn't bother me too much after that ;^)
Impressive indeed, thanks for the link. Someone made the case recently that agent-based simulations are the way to go for the next generation of world models, it's easy to see how your approach would have immediate application in that regard.
Can this be applied to real-world URR? I'm certainly no expert, but it seems like we know enough about the geology of the world to come up with a reasonable list of sedimentary basin "subvolumes". Or would it be enough to simply apply a grid to the Earth, perhaps weight the cells for difficulty of terrain/polar/deepwater exploration, and then let entropy do the rest?
Again, it would be interesting to know where we are at today in our search of the Earth using this metric. I recall a recent SciAm article made the claim that we have only just begun to explore potentially oil bearing sedimentary basins of the world. I personally didn't find that claim to be credible, but perhaps your model could shed some light.
Did I just hear you validate ol' man Hubbert?
"And has thou slain the Heuristic?
Come to my arms, my beamish boy!
O frabjous day! Callooh! Callay!"
Now if you could just use entropy to nail the coffin shut on those Limits to Growth dorks...
FYI, I had trouble getting the spreadsheet to update in Firefox. I tried the usual suspects, clearing the cache, opening the link in a new window, etc., but I would usually get the same MC simulation. Through blind trial and error I've noticed that I can get it to refresh if I wait an unspecified amount of time, looks like something has to time out for any given session before hitting refresh actually re-sends the request.
Cheers,
Jerry
None of us are experts Jerry. Your suggestion is as good as any I have seen. We are just trying to understand the stuff that all the geologists and petroleum geologists have deemed unimportant all these years. Hubbert opened up the window by postulating the curve, and this may finally shed some light as to why the Logistic curve often seems to match the data.
Thanks for investigating the refresh behavior. I observed the same thing. I think most of the calculations are done on the sever side and Google must throttle this to prevent too much load on their end.
Raw Video of June 9 fly over by Jefferson Parish Sheriff's Office
http://www.deepwaterbp.com/
and this
Efforts to Limit the Flow of Spill News
http://www.nytimes.com/2010/06/10/us/10access.html?ref=media
From the Times article linked above:
Now what, pray tell, was a BP contractor doing answering the phone at a Coast Guard-Federal Aviation Administration command center?
This bears investigation all by itself! The gummint in bed with the polluter! And press freedom restricted!
Scientists questioned. And prevented from gathering info of primary importance to all of us!
The article is a must read. Here's the link again:
http://www.nytimes.com/2010/06/10/us/10access.html?ref=media
I'm going for my checkbook right now! Another donation to this site on its way!
"Now what, pray tell, was a BP contractor doing answering the phone at a Coast Guard-Federal Aviation Administration command center?"
A WAG but perhaps BP are paying the cost of running this center and hence have recruited people to man the phones?
I know there are all sorts of conspiracies that BP are preventing people who are working on this from speaking to the media but they have sent an email to everybody stating this is OK as long as they are not speaking on behalf of BP or the command center.
Presumably this airspace is restricted for a reason, e.g. so masses of planes don't crash into each other or impede the work I assume there will be many helicopters flying between the boats/rigs... The photo at the top of the story is of the Dicoverer Enterprise so no problem getting there. I thought there was lots of footage already so maybe the media looking for a story?
BP could not be doing this without govt cooperation. Restriction of Freedom of Press is an abridgment of the First Amendment. Interfering with the Press gathering info in order to inform the public is an aspect of Freedom of the Press. And that is news worthy or being reported. I do want my first amendment protected.
I respect that you and I differ over this.
But this, to me, is an outrage and a violation of the First Amendment. I suggest we address the matter from that point of view, as I have here:
http://tpmcafe.talkingpointsmemo.com/talk/blogs/t/h/therap/2010/06/rage-...
If TOD wants this site to be full of facts, then it is necessary that those facts be gathered and not hindered. We all suffer if Freedom of the Press suffers. It is the basis upon which our Republic functions.
IMVHO
Sorry, all due respect but I am not immediately buying your on its face, breathless assertion that implies some government complicity. You seem to imply some conspiracy to abridge freedom of the press or general information to the public by the government to somehow help BP. Crimeney! Some article in the wherever paper or whatever blog and folks are off to the races without any evidence of fact or any examination of the accuracy of key assertions in the article...
How about a little skepticism? I think that serves us in almost every instance no matter what your general world view holds
I posted in haste. Thanks for the wise words. my bad...
"I respect that you and I differ over this." I was going to come back at you over this but reading on a bit see you were in haste so no problem. Please accept that even if i don't know the details of your first amendment I strongly believe in free speech and the right of the media and people to investigate.
Glad to see that you have found TOD and are making good use of it as opposed to those that just scream for instant answers or solutions, I hope you continue with TOD after the "excitement" is over.
CBS has video of its reporters being threatened with arrest if they tried to film an area of Louisiana coastline. Easy enough to find online. USCG officer notes that "These are BP's rules."
Plausible. Next thing to attempt is to ask civilian-tasked earth-observing satellites to start to take high-resolution imagery of the spill region.
No possible way to deny the request on air traffic grounds. Would make an interesting test for collusion or obstruction of the public to be informed, in my opinion.
I would ask the BP contractor if they are a member of the Coast Guard and what authority do they have to approve or deny air space permission. Chances are none or very little. They're probably just there to answer phones.
Interesting to see something like this in the USA. In the aftermath of the Kuwait war, there was a media embargo on catastrophic imagery, with all uncontrolled media crews, even major networks, bottled up in Bahrain. Getting the full scope of the images made public, and the international media into the worst areas, was quite a project. Accomplishing that made it possible to apply pressure to drop the US/UK/Kuwait ban on international oilwell-control efforts. Someday maybe I'll write about it.
Images are a powerful currency.
One practical problem is that they can't have a horde of sightseers converging on the spot from every direction.
OTOH the powers that be can always deny access to anything by anyone on the grounds of "safety". Campaigners in recent decades have insisted that there exists "moral" imperative, trumping all else, of seeking the absolute zero of risk at any and all cost. Some of that has been reflected histrionically (and IMO sometimes mindlessly) in these pages.
Can't have it both ways. And after all, who knows, maybe there could be a one-in-a-quadrillion way for a reporter to die instantly if he or she so much as touched a tarball or whatever. Can't take the chance.
Yesterday I read a first hand report from a guy on one of the skimmer ships within sight of the drilling rigs, a medic, who observed a sky full of aircraft coming and going. In his opinion, opening access to sight seers, press or otherwise, would be grossly unsafe and foolishly irresponsible.
This website likes to take a series of facts (seafloor corruption) and weave a tale, but are the facts true?
http://www.whatdoesitmean.com/index1379.htm
That website is run by a nutcase (at best).
Sorcha Faal... Internet Hoax Queen Courtesy of David Booth...
I surmise that we have at least one "Sorcha Faal" at any one time on TOD commenting. You fall into a trap with most subjective reporting of not knowing where the truth lies because everyone always wants to tell both sides of the story. So when something is obviously true, you get the alternate version as well. I have tended to drift lately into the more objective data-centric realm where you can actually use some logic to reason about state of the world. But then again, that data could also be fake. Yet there are all sorts of interesting ways to tell if data has been faked.
To be open-minded and simultaneously prevent your head from exploding are two conflicting goals.
It all depends if you choose to store it or let it flow through =)
His mind is so open that the wind whistles through it.
--Heywood Hale Broun
It's one way to stay cool, I suppose.
BP Shareholders File Lawsuit Over Gulf Oil Spill
06/10 6:00 am (PRN)
NEW YORK, June 10 /PRNewswire/ -- Citing the company's history of safety lapses, cost cutting, and workplace disasters, shareholders who purchased stock in BP
Zwerling, Schachter & Zwerling, LLP NYSE: BP The lawsuit notes BP's prior statements about its Gulf operations being a primary economic driver, and the company's assertions that it had the technology to safely conduct the operations. But nearly a month after the catastrophic explosion at the Deepwater Horizon, BP's Chief Executive Officer Anthony B. Hayward The lawsuit chronicles BP's long history of spills, fires and explosions at its facilities, including a 2005 explosion in Texas City, Texas, that killed 15 people, and a 2006 oil leak in its Prudhoe Bay, Alaska, operations pipeline. ??In the Alaska case, Zwerling, Schachter & Zwerling served as lead counsel for securities plaintiffs who brought suit against BP, and secured a multimillion-dollar settlement on their behalf. In the current case, shareholders claim BP violated the Securities Exchange Act of 1934 by issuing false and misleading statements about safety, technology, inspections and precautions at its offshore oil facilities.?? At the time of the latest disaster, BP shares were trading at nearly $60, but since have lost nearly half their value.?? If you purchased or otherwise acquired the ordinary shares and/or ADRs of BP during the Class Period, you may apply to serve as lead plaintiff.?? The lead plaintiff is responsible for overseeing the prosecution of the action and ensuring that the interests of the class are protected.?? Should you desire to be lead plaintiff, you may apply to be appointed through Zwerling, Schachter & Zwerling, as counsel.?? The deadline for seeking to become a lead plaintiff is July 20, 2010.?? Zwerling, Schachter & Zwerling, LLP represents clients nationwide in financial-related class action lawsuits. ??With offices in New York City, Garden City, N.Y. and Seattle, the firm currently plays a leading role in numerous major securities and complex commercial litigations pending in federal and state courts.
The vultures are circling.
The more Matt Simmons opens his mouth, the more it sounds like he's gone off the deep end.
Hardly a day goes by it seems, without him making pronouncements that don't pass the sniff test, at the very least. Now its that BP (with the flesh eating lawyers) have someone signed up to pay any and all fanciful bills, with no possible getout clause - and so will go bankrupt. Unless he can actually put some meat on those sensationalist bones, I think we'll have to sadly consign him to the loony pile.
Fantastic claims demand fantastic proof - and its still missing-in-action.
I agree that Matt tends to exaggerate. There is no lake of oil on the bottom of the GOM but there is a lot of oil mixed with a lot of water floating around under the surface of the GOM. They are referring to it as plumes of oil. Matt should lighten up a bit and explain that the oil is mixing with water which has the potential to be even worse. But one thing he did say is absolutely correct:
BP stock has dropped by over 51 percent since the disaster. It is likely to drop a lot further. I argued with my wife, who said BP would declare bankruptcy. I now think I was wrong. The future of BP looks very bleak right now. Their liabilities will eventually greatly exceed their assets. This disaster will likely bankrupt them.....eventually.
Ron P.
I doubt that BP will allow their total exposure to rise much above the $2bn mark, probably spread out over time. They have far too many options to limit claims for the shareholders to accept that. As I say, I would expect they have partitioned this off, and as a multinational they have 101 ways to make sure the at-risk elements are only those in the US. Even then, I'd expect a disposal of the US assets to recoup some of the amount.
Don't forget, if the US administration get to ambitious to grab for money they effectively toll the death knell for future exploration in their waters - and with it domestic production capability. No sane multinational oil company will bet the firm on a region where one accident kills the company.
Correct.
However I don't see what this has to do with BP.
I assume you mean only an insane company would do such a thing. Good catch!
However I must disagree, an accident can kill any company if big enough and in the right place. The Bhopal disaster would have killed Union Carbide had the accident happened in New York instead of India. Likewise the Chernobyl disaster would have killed any power company anywhere in the world. But the operator of Chernobyl was not a company, it was the Soviet government.
If this BP GOM disaster destroys as much of the Gulf Coast economy as I suspect it will, and destroys as much wildlife as I suspect it will, then the loss will be far greater than the net worth of BP. Any company in the world that causes far more destruction than its net worth, and if this fact can be proved, and if they can be legally charged with that destruction, then they will go bankrupt, and deservedly so.
Notice I stipulate that the fact must be proved. The tobacco companies have obviously caused far more money to be spent on medical expenses than their net worth but this has yet to be proved in the minds of many juries.
But the fly in the ointment is this is a public company, not a private company. The loss will be suffered by the shareholders, not any person or persons called "British Petroleum".
Ron P.
I was under the impression that the Chernobyl accident did significantly contribute to the demise of the soviet Union?
Your impression is wrong. Just like the propaganda that Ronnie Raygun brought down the Soviet Union.
The USSR was a victim of its own economic policies. It had the wrong mix of command and market economics. It stagnated for about a quarter of a century, after the short-lived post-war vibrancy due to massive capital expenditures in industrial infrastructure. Then because of an unwillingness to provide for a legitimate market mechanism, it disintegrated.
I've always been amused by the right wingers who credit their Saint Ronnie with the demise of the USSR. I guess right wingers really believe that command economies are not only viable, but formidable.
But to these characters, after the heroic invasion of Grenada, America was again standing tall.
Little known fact sure to be objected to by the acolytes of Ronnie is Trudeau was in there a full year ahead having discussions with Gorbachev on reforming the Soviet economy realizing theirs was failing. Guess they aspired to be more like Canada than the U.S.
Oddly enough, Margaret Thatcher's musings that she could do business with Gorbachev is often accredited with breathing liberal life into the dry bones of communism while Pierre Trudeau's meeting with Soviet and eastern European leaders is viewed as some kind of peacenik hiatus of no-consequence.
Overlooked, too, by Anglo-American triumphalists, was the role played by John Paul II who threatened to help man the barricades in Gdansk if the Soviets sent troops into his beloved Poland. Now, that took bollocks the size of melons.
Much mythology and myth-making continues to surround the 1980s.
+1
I'm always horrified that we give the peoples of Eastern Europe no credit for ending their governments. No "agency" as they say.
Apparently after a couple of decades of neoliberalism, the Russian proverb has been "Everything the communists said about coommunism was a lie... but everything they said about capitalism was true!"
Interestingly, Chernobyl was given as one of the reasons for the demise of said government a few years later.
It was a sign that in retrospect noted the Soviet capacity for technological prowess was oversold
It became clear after a while that it was a sign that the USSR could not survive
That's why the federal government insures nuke plants, otherwise presumably no private investor would/could build them. http://en.wikipedia.org/wiki/Price%E2%80%93Anderson_Nuclear_Industries_I...
Yeah, Simmons is way over his head on this one. If there really were a "lake at the bottom of the Gulf of Mexico", there would be no way for it to reach the surface. As it is, the waters around the well are a mile deep and very cold, near freezing. The reason that they are so cold is that they are quite dense and thus can not rise to the surface. That water has been down there for a very long time, as in, centuries. No hurricane has been able to bring that cold water to the surface and thus it's exceedingly unlikely that any future hurricane could do so.
Sorry, Matt...
E. Swanson
Quick - let's get Congress to approve another bailout.
TARP - 3 (Toxic Accident Reclamation Program - 3)
Well the consensus seems that Matt is wrong on this one, and it is not just a matter of exageration.
At first I also did not think it would go bankrupt, mainly because the company (BP) and contractors have set up a series of legal arrangements to limit their liabilities. The most basic example is that the BP part is owned by a US limited liability company.
However I think that it is still likely that the US portion of BP will go bankrupt (but probably not the main British company). The reasons are the number and magnitude of lawsuits, and it may be better to assert their legal rights before some retroactive law or ruling limits their ability to segregate US assets from other worls assets.
I give it kess than 3 months and if Simmons is even a very small part right about the amount of oil, then we are talking about a matter of only a few weeks.
I go even farther in my qualification and think that some part of BP America will declare bankruptcy, but it's impossible to guess at this time just what part, and what form the proceedings might take.
As a hypothetical, assume that BP Exploration files for Chapter 7, and their filing says:
IANAL, but have listened from time to time as corporate lawyers discussed bankruptcy options. Such a filing, at least IMO, would make it difficult for creditors to go after other BP America assets. So far as I know, there are no US federal laws that specify any circumstances under which the limited liability aspects of a state-chartered LLC can be set aside.
Just needs to be said, that ex post facto (retroactive) laws are forbidden in the US Constitution. That doesn't mean it can't happen, but you would need to get Congress to pass it, the President to sign it and agree to enforce it, and the Supreme Court to refuse to hear it. Well, technically Congress could do it all by itself, by overriding a Presidential veto, excluding the law from Supreme Court jurisdiction, and impeaching Presidents until they got one who agreed to enforce the law, but that seems unlikely.
At some point, Hayward's pledge to use "all" of the global resources of BP to clean up the mess will likely be repudiated by the board of directors, who can almost certainly say accurately that he didn't have the authority to make such a pledge.
Techncially I think you are very much correct as to how the BP situation might well work out. I was just alluding to the fact, if we study the General Motors bankruptcy, that the Government had unusual influence on the post bankruptcy creditor claims. Not to mention the unusual way in which Wall Street and AIG bankruptcies were handled.
Also my opinion is that BP will be forced at some level beyond the exploration company to pay huge fines. I'm not saying that it will follow conventional federal law and procedure, but none the less may happen. Due to the difficulty of passing retroactive law, the government may just demand certain payments.
That is why it may be better for them just to hand over the exploration company to the government at this time (most likely through bankruptcy to establish a legal position) in exchange for release from all civil penalties against the rest of the company.
I think when this all plays out, BP will land in the "too big to fail" category and will be rescued or somehow left off the final hook by UK/USA. Check back on this statement in about 6 months.
Hmm...I had not read my evening The Automatic Earth before writing the above comments, but tonight's edition is in agreement, except for maybe the Simmons part at the beginning.
http://theautomaticearth.blogspot.com/2010/06/june-10-2010-bp-forrest-gu...
Sorry for the late response, but I think the AE article is more than a tad overly dramatic about what will happen.
Did the US bail out shareholders of Enron, GM, AIG, Lehman, and BS? Well to a very small extent that is hardly worth noting.
Of course the US did bail out derivative trades there even while letting most bondholders go bust in those cases.
The US is just not going to bail out US or British stockholders, except possibly to change some tax laws concering loss deductions. I expect little more from england for its British shareholders.
Yeah, I agree!
From The Gulf Coast oil spill's Dr. Doom (interview with Matt Simmons),
Either the media and their reporters are a bunch of imbeciles, or there is a concerted effort on their part to deliberately paint Matt as a moron of the highest order or the poor man has indeed begun to lose his mental faculties.
I can't believe that Matt Simmons thinks there is a lake of black oil 500ft deep and a hundred miles long at the bottom of the Gulf of Mexico or that even a Cat 5 hurricane would have any effect on such a lake a mile under the surface. Something just doesn't add up here...
Matt simmons has been an outspoken campaigner for Peak Oil, dirty his rep, and dirty Peak Oil as a nut job theory, ergo BAU wins again. Just some thoughts from the side lines. I have not been looking at the news headlines much, though I also don't have a TV, so getting my news from the local paper, and online is how I do it. I mostly read the news on google, and the Drumbeats if I read the news.
I don't know why Matt would say the things people are saying he is saying, then again I don't know the man personally. I try not to judge character faults unless I see them myself, then I don't repeat what I see unless it is to protect someone else. Best not to say bad things about anyone if you can help it, even if they might be true.
So caution is called for in all this.
Charles,
BioWebScape designs for a better fed and housed future,
Hugs from Arkansas.
Call it the Michael Ruppert syndrome. Very intelligent folks that let their emotions/imagination out verbally one too many times. Been there and done that. Apologized and moved on.
This adds some interesting information that adds some credence to Matt Simmons claim. An news story on MSNBC:
http://www.youtube.com/watch?v=a_uMg84BBzE&feature=player_embedded
It includes a quote from an anonymous BP official that "We discovered things that were broken sub-surface...". It is reported that mud that was being pushed into the well was making it "out to the side" and "into the formation".
The interviewer reports that he has heard that BP experienced some type of failure during the top kill procedure that caused them quickly to shut it down Memorial Day weekend.
I'm not sure how Simmons' is concluding a leak 7 miles away, but it sure sounds like there is circumstantial evidence of a casing failure.
Indeed . . . after listening to many of his presentations and reading what he writes, I long ago realized that you need to take everything he says with a grain of salt. He is quite excitable and prone to be overly pessimistic. If you took everything he said seriously then the entire oil industry should have collapsed by now and we'd be lucky to get oil for $300/barrel.
He is a finance guy not an engineer . . . so despite his long career in the biz, I don't think he has the best expertise on this spill.
And with regard to peak oil, I think Chris Skrebowski provides a much more reasoned (and less emotional) view on peak oil.
Simmons says:
Being the great technical expertise of Simmons, and his contacts inside the industry and even - at least previously - inside the White House, is could what he is saying about a great underwater pool of oil be correct?
Let's be generous, let's say this 'lake' is 100 miles long, 1 mile wide, and the 500 feet thick he says it is, with the addition of the a guess for the missing figure. That equals 2.5 x 10^11 barrels of oil.
If you say this spill has put out 20,000 bpd for 60 days, that's 1.2 x 10^6 barrels of oil.
So somehow the lake is 5 orders of magnitude more than the total volume of oil released. Enough to keep the world going for 8 years.
Well, if we hit the peak, we know how to solve it.....
Hi
I just had to check the calculation of that statement too:
Assume some rectangular form for that lake,
say 100 miles "wide", and only 6 miles across. 400 feet thick, same is 120 m.
That makes black oil 160*10*0.1 km3 (cubic kms). or 100*6*0.06 miles cubed.
A barrel is what 160 liters? and 40 gallons?
So Simmons means there is about 1'000'000'000'000 barrels down there.
That is 1000 billion barrels. Thats like if the leakage has been millions of barrels per day.
He is making NO SENSE. What on earth is he trying to say?
?
Simmons income is mainly as an investement banker, right?
What if he is really trying to sink the BP stock value:
"there is a pool of oil" "can hit shore later" = more cleaning up costs coming.
"BP can bankrupt" - has he shorted BP stock, and is taking call options?
Could it be that simple?
Can he be liable for talking badly about BP?
The 2nd article below top is interpreting that Simmons DID influence BPs stock value.
"BP's Shares Plunge on Spill Liability Fears".
Incredible.
If so, Simmons is a very, very clever man. And I can understand that he has become very rich.
Who are these people who stuck with BP stock until they heard the Matt Simmons interview? Had they no concept of BP's liabilities already? I mean, we're already discussing the possible end of BP, or BP as now constituted, on here running for the most part on the assumption that Simmons is wrong...
I did wonder if he had shorted BP stock a while back. Now I just wonder if he's got an alternative energy play and he's looking to downplay oil as a whole to make AE investments look better.
Seems so.
From top article
Simmons "Now I'm working on a big project in mid-coast Maine called the Ocean Energy Institute, and we're hoping that within the next year we can actually create 50 megawatt offshore wind turbines".
sorry for making additional publicity for him ;)
(Ps I think I meant in two posts above also he might be buying PUT options, as BP is expected going lower in price)
Do the numbers. Black oil, not a plume, not a mix, not an emulsion, black. 500 feet, by 100 miles. No suggestion about width however. Lets try 1/10 the length - so 10 miles. That is about 1.4x10^13 cubic feet. Which is 10^14 US gallons. 2.5x10^12 bbl. Which is pretty impressive. Indeed so impressive that we should be lauding Matt from here to the end of eternity, for he has clearly solved our energy needs for quite some time. This lake is of a similar size as the known oil reserves of the rest of the planet.
Now lets be generous to Matt, and say that instead of solid black oil, he meant an oil water mix with only say 1% oil in it. So that means 2.4x10^10 bbl, which is more oil than the reserves in the entire US - including the rest of the wells in the Gulf of Mexico.
If we were to be really generous, and say one part in a million oil, we get 2.4 million bbl. If we say that the well has been flowing for 100 days, we get a flow rate of 25,000 bbl/per day. Which might just sneak into credulity. Maybe.
But he actually said black oil, and he clearly meant close to 100% oil. And proposed that we send in tankers to suck it up.
No, the man has lost it.
Maybe Simmons is deliberately exagerating for a reason. Maybe he sees this enormous supply crisis about to hit and this Gulf disaster as a means to wake people up to the need to develop alternatives, like his Cape Wind initiative. Now I don't think for a minute that offshore wind is going to do anything to cushion the blow from peak oil. But Matt apparently thinks so.
Read the comments below the Fortune article and you will see that people aren't about to be "woken up". Instead they are going to become very angry and violent.
Why doesn't someone from the Oil Drum request an interview with Simmons to clarify his statements on the oil disaster if you find them so outlandish. I don't think he's lost his mind, but I do think a lot of other people are going to soon.
SolarDude, I don't think that its a wake up call. He exaggerates his wind turbines project as well. 50 MW is just rediculous.
But let us make the best of all. Let us looking forward to his next publication - Tenthlight in twelve desserts and eight forrests.
According to the USF plume samples had oil content of about 500 parts per billion.
http://www.wtsp.com/news/local/morning/story.aspx?storyid=133654&catid=25
"St. Petersburg, Florida -- The government agency overseeing the science of the Gulf oil spill announced Tuesday morning that it has confirmed underwater oil plumes as far as 142 miles from the BP spill site.
The government says water tests have confirmed underwater oil plumes as far as 142 miles from the BP oil spill, but that concentrations are "very low."
NOAA Administrator Jane Lubchenco said that the tests conducted at three sites by a University of South Florida research vessel confirmed oil as far as 3,300 feet below the surface 42 miles northeast of the well site and also oil below-surface oil 142 miles southeast.
Lubchenco said the analysis "indicate there is definitely oil sub surface. It's in very low concentrations" of 0.5 parts per million.
BP had questioned whether oil actually was forming below water."
This is reedicoolous! Of course there is oil sub-surface. They have been using dispersants in record amounts at the source of the leak: 5,000 feet under the surface of the sea.
The decision to use dispersants or not was a choice between two evils: Let the oil decimate the beaches and wetlands or live in the water column. They have used record amounts of the "dispersants" which have never been tested on deep water environments. I think it will end up being a lot like Agent Orange was in Vietnam. It solved one short-term problem and traded it for the unintended consequences of killing thousands of American serviceman and Vietnamese civilians. Bio-accumulation is a nasty thing.
Joe
I suspect few will be surprised to read this but here we go
from this BP report
http://s3.documentcloud.org/documents/4364/2001-bp-operational-integrity...
http://www.truthdig.com/report/item/internal_probes_warned_that_neglect_...
Reports are that Gulf of Mexico insurance costs have increased 15% (see below). Frankly I think that is just the beginning of large insurance increases.
At this point in time, the effective marginal cost of developing a new field probably exceeds the price of oil received.
http://www.istockanalyst.com/article/viewiStockNews/articleid/4197655
Please note that I do not entirely agree with the author above, especially where it is said energy problems 'dictate' deep water drilling. Sounds much like "we must have BAU at any cost".
Who pays the price when a corporation gets itself into a jam? And who stands to "profit"? Surely the fishermen are not really "profiting" if they are repaid a pittance for what they lose, not just for retirement but for the rest of their lives perhaps.
I can understand the plight of retirees who own BP stock. Indeed, my own dad, who once worked for GE has thousands of GE shares (after a small investment from over 40 years ago doubled and trebled his shares over many years). And when the GE financial section (which had fueled much of that growth of late) got itself into hot water recently, what happened? Warren Buffet stepped in with billions in loans - at 10% interest as I recall - and GE dividends were cut substantially. That affected my dad - and many other people.
These things are happening all over now. It's all interconnected. Oil has been a kind of "money" in a way. And money exchanged for it has fueled lots of speculation. We know from fables that people have always built castles in the air - before the milk spilled or the eggs dropped (or the oil ran out).
I can't provide a solution here. But corporations make "deals" or pay up when they make a mess. And the stockholders suffer. Yes, that's true. It's risk of holding stocks. Bonds can be risky too.
Life itself is risky. As I wrote last week, we first need to come to terms with the fact that life is finite. We are here for a short while. Others will come after us. We owe them a world they can enjoy and care for and pass along. Once you take that longer perspective and see yourself as part of "the whole" - part of something much larger than yourself and that we are all in this together... then at the very least you can begin to do your small part for the future. Not just your future - but the future of the planet, of its inhabitants. We pass our "inheritance" which we received - this earth we love - to those who come along behind us, to those yet to be born.
It is from that perspective that we need to address corporate culture and how it has raped and pillaged this earth - to our detriment.
Very nice summary of our predicament Thera...
Unfortunately based on my interactions with people on a daily basis there is almost no recognition of what you speak of - namely this idea of being some part of a whole of something. I get the impression that most people in the US could care less (and probably wouldn't even notice) whether they were on the fragile blue marble of earth or wandering the frozen wasteland of Pluto - just as long as they can have their cars, cell phones, and TVs (and of course had some air to breath and water to drink)...
Yes, I realize I'm calling for some kind of spiritual enlightenment process. And that's a stretch - for most people.
Nevertheless, this crisis is being closely followed by the public. People are taking notice. We may not influence all of them. But peeling away people, little by little - and those people affecting others around them - we just have to keep putting one foot in front of the other, doing our part - no matter how small - never knowing perhaps how "our part" may have affected a few people.
That's our task. Continuing down the right path - no matter how futile it may seem sometimes. Never giving up! The stakes are high. We are tiny. But altogether - it makes a bit of difference.
Who among those who have been here for many, many years - at this site (and that's not me) - could ever have imagined the deluge of interest and willing assistance from new people - that has occurred since this oil gusher in the Gulf? Many here have toiled for years - seemingly in the wilderness, it seems to me. And only now is all that effort bearing fruit in huge ways - which we cannot yet determine.
I hear your frustration. But we keep on... keeping on.
TheraP...in evolutionary studies, I would call this Preadaption.
In that case I too have been engaging in activities which I had no way of knowing would bear fruit at this moment.
Thank you for that term! I will ponder its meanings.
By the way, Catskill, you might enjoy this little blog from a while back:
http://wisdom4nothing.blogspot.com/2009/07/it-is-just-ordinary-grayish-r...
I so miss upstate NY!
Thanks Thera - I do remember that day - up near Woodstock I believe...
Each weekend I escape the insanity of our local hyper-consumerism to go be with the rocks of the Catskills...
It is far more civilized way out in the Cats - amongst the rocks and the hemlocks - than it ever is back in "civilization" ;)
"Search a beach, road, lake, river and find a random rock. Carry it with you for a while, look at it, think about it, and in short order it will become special. Tell me why it's special? Everything is special; and so nothing is. It is important to realize this in order to realize that you (and everything else) are not special, but that doesn't make you (or everything else) any less amazing." ???? forgive the intrusion, but that little blog reminded me of this quote. wish i could remember who it is attributed too.
You know, even as adults we have our "security blankets" - those things that bring us comfort or remind us of something special. We are each unique. And there is a sacredness that runs through life, through every living thing, every person, every part of nature, the entire universe. I love it!
Your comment is no intrusion. Look how stimulated my thinking! :-)
Here's a rock - that's at risk. Sacred to Native People. Interesting stand-off going on:
http://tpmcafe.talkingpointsmemo.com/talk/blogs/f/l/flowerchild/2010/06/...
Think of the corproration as a king of old. The king had a small holding say a square mile of river fed forest and needed to have people , we will call them serfs manning the farm, and guarding the castle, and he fed them a little bit and they were loyal to him. Thousands of little kingdoms made up the countries we see now. The people who hold the purse strings are just that, little kings controling people's lives. They the corporations don't really care for the future unless it feeds them, they only care for their profits. They are even worse than the kings of old, who did a bit of killing their own serfs and making them live is unheated shacks.
In the end if the powers that be who are in control today cared for the world, it would not be in the state it is today. They'd be no poor people living out of waste dumps in other coutries, no homeless people, and no wastelands made by men funded by the businesses of today, because tomorrow is where we live not today.
But the world has been on this sefl destructive path for a long time, longer than any of the oldest of us have been alive. I have a book talking about Swales, and how to use natural landscaping and how to get rid of the affects of the the mono-cultured croplands of the US. It was written 30 years ago. IT has been with us all these years, the people in the sustainable gardening movements of the One Straw revolution, permaculture, forest gardening, started 30 years ago, back then they knew of a better way of life, from their peers that were older then they were then.
We knew all this stuff 50 to 100 years ago, and we did notthing to change our world. We only have scratched the surface of getting to a better world for the future, and the reason why? Is likely that those who wanted a better world for the future generations, were black listed as freaks and hippies and not to be listened to by the main stream.
Peak Oil was known about long long ago, as well as over population and over pollution and all the ills we are suffering from today. Ages ago men and women saw the writing on the walls of their caves and tried to tell other about it. But someone or some force in the world covered it over, and said they were just crazy folks and you really need to buy a new Delta 98 for your family and not drive an electric car or ride in a train, or grow your own foods, or reduce reduce and recycle.
The internet generation is wondering why we have all this talk of change now, when in reality we have had all this talk for over 50 years, and nothing much has changed.
Corporations are now people as far as the US government is concerned, see the recent SC rulings. Why oh why have no one been listening for all these years?
I don't know, but leaving something for the kids has been a short sighted thing in most peoples minds, and some people could care less about their own kids, you can see that on the nightly news everytime you watch it.
The future is the road we take today, and if we don't take the right road our future will fall over the cliff, into something we don't even want to think about today. Who of us are on the right road and who of us are on the wrong road, and who do we tell the difference?
To many thoughts for one post, so I'll stop my ranting now.
Charles,
BioWebScape designs for a better fed and housed future, starting today, hugs from arkansas.
The McKibben does an excellent and much needed job of placing the oil spill in its broader contexts, particularly regarding PO and GW:
"...Let's think about the stories that are suggested by this trouble.
One has something to do with peak oil. BP has gone to all this trouble for a well that taps into what they now think may be 100 million barrels of oil. And that's... five days supply for the U.S? Does that give you any sense of the precariousness of the arrangements under-girding our economy right at the moment?
Another -- even more important -- has to do with global warming. Let's assume that the oil from the Deepwater Horizon made it safely onshore and was refined and then burned in the gas tank of your car. What then? Well, the CO2 in the atmosphere would be doing at least as much damage as the oil spreading across the Gulf. Consider the following things that have happened since the Deepwater exploded:
* Asia and Southeast Asia have each recorded their hottest temperatures ever -- 129 degrees in Pakistan, and 117 in Burma. India is having the worst heatwave since the British started keeping records -- people are dying by the hundreds.
* We've seen the biggest rainstorms ever recorded in lots of places, from Nashville to Guatemala -- the clear result of an atmosphere made 5% wetter because warm air holds more water vapor than cold.
* Satellite data has shown that Arctic ice is now melting even faster than in the record year of 2007.
* NASA has released new statistics showing that the past 12 months were the warmest on record and that 2010 is almost certain to set the title for the warmest calendar year yet.
All of these, it seems to me, could be considered parts of the Deepwater Horizon story because they demonstrate that fossil fuel is everywhere dirty. They change the political question from "is Obama angry enough" to "can Obama lead a credible fight for real energy and climate legislation?" More to the point, they connect with the mood of existential despair and anger that the oil spill has set off across the country. People are sad and bitter only in part because they see those pelicans oiled; mostly, they sense correctly that our leaders have yet to deal with what is clearly the biggest problem we face: the transition off of fossil fuels..."
"our leaders have yet to deal with the transition off of fossil fuels...."
But the leaders just take their cue from the voters. What kind of politician could get elected saying, "O.K. Now no more cars! That`s right, we`re going to be walking and biking and building some train lines." People would just laugh. They would vote for the "cash for clunkers" "hey, get your car here!" politician.
But now with this devastating oil spill there might be some sort of groundswell of support for a politician who says , "no more cars". Let`s HOPE SO!!
The craziest thing Simmons said was that the industry went 41 years operating in the US without an oil spill.
Using Occam's Razor I have come to the tentative conclusion that Matt Simmons has become senile. The man being interviewed now is nothing like the man who wrote "Twilight in the Desert." Senility is the kindest and most charitable explanation of what Simmons has been saying in the glare of TV publicity.
Beware of the sayings of old men who are famous. During his last years of senility Bertrand Russel's keepers maneuvered him into saying all sorts of silly things.
I suspect that he meant a lack of serious oil spills related to exploration & production versus transportation (e.g., Exxon Valdez).
I suspect, like that 1/3 barrel/day found by SkyTruth, that there are far more point source leaks than we generally ever learn of.
Beyond that, the number of large spills is absolutely ridiculous:
http://www.itopf.com/information-services/data-and-statistics/statistics/
Link up top: Peak Oil, FTW.
This is an extremely good article. It explains a lot. The plateau of world oil production has lasted for six years, since the summer of 2004. And oil's share of BTUs spent has declined from 39 percent in 1999 to 34.77 percent last year. And the difference was taken up by coal.
As the world offers lip service to carbon controls to combat AGW, coal consumption continues to increase.
Well, I think that statement may be a little presumptuous. Most of us here at TOD put that debate to rest some time ago but most of the rest of the world remains to be convinced.
Ron P.
The "lake of oil" is starting to get annoying.
In another thread, using the numbers provided by NOAA of 0.4 gm per cubic meter, that works out to 8 drops of oil in 263 gallons.
NOAA said "very low concentrations".
I think NOAA were the ones who said this oil wasn't visible, and you could see it only if you passed enough water through a filter.
Instead of referring to a 'plume' we should be calling it 'trace amounts of oil in the water column'.
Gerry, you're talking apples and oranges - and somehow, to me, there's no relation between them and the post you've commented on.
This so-called "lake of black oil" is not the same as the "oil plumes". The plumes of oil are now a documented scientific fact. The lake, so far as anyone can tell, is a myth at this point.
The "oil plumes" may have small concentrations of oil. But would you accept such concentrations in your ice cream, for example, if you went to buy a cone? Well... then consider those same concentrations in the "food chain" of the Gulf. And moving around the world perhaps...
Take your time. Learn from this site. Be cautious what you write. And I say this as someone who's just a few days longer here than you.
And don't take that statement as the definitive one on the plumes. They sampled very small areas, and precious few of them (<80 total, IIRC), far away from the well.
A crew actually dove into the Gulf along the coast to a depth of 60' and found very visble clouds of oil and even stringy ribbons of tarrish material floating at that depth. There is video of this, it was playing on various news shows last night.
Samantha Joye talked about seeing stringy ribbons down below the surface as the Pelican traveled; those sample were not part of the report that was released. They have stayed within 20 miles of accident site, IIRC.
There are going to be a lot of places with more than 500ppb.
If you are only taking a handful of samples then you should not do random sampling. You can take control samples that have no visible floating hydrocarbons, but then you should go and search for some subsurface areas that obviously contain some visible hydrocarbons. This would give you the range of extremes.
The ideal situation would be random sampling. Create a grid over the northern half of the GOM, say 5 mile x 5 mile squares, and then take 100 random samples within each grid at a certain depth (500 feet?). If your time and budget do not allow this much sampling, then increase your grid size and/or decrease your sample size.
Then you might start talking about statistical significance and probabilities.
Gerry, for starters your reply had nothing to do with my post. People continue to commit the error of replying to a post with something not related to that post and I really cannot understand why.
However I would regard .4 grams per cubic meter as significant. What would this do to the gills of fish? I suspect that it is far more serious than many suspect.
Two Major Underwater Oil Plumes Found in the Gulf
Ron P.
Excellent question. Inspired me to ask, and hopefully someone will have access to the answer:
"What is the LD50(http://en.wikipedia.org/wiki/Median_lethal_dose) of raw oil in an aquatic environment?"
Having the oil only visible if passed through a filter may not be a bad thing unless that filter happened to be gills.
I know that is not the intent of your comment and I'm referencing out of context. My point is the apparent low concentrations may have more impact than dense surface concentrations. That's just my non-expert, lay postulation.
This idea may have been kicked around earlier
Build a steel pipe riser stack 5000' long x 10'-15' diameter.Lower it over the leak on the floor of the Gulf.Allow the oil to rise as it is being pumped off at the surface and put in waiting tankers.
Stop the Spill
Many many times, more than 20,000 ideas on how to stop the flow of oil or contain the oil spill have been sent to BP since the incident. It would be a good idea to search for previously thought of ideas and at least put some effort into calculating what would be required, e.g. what would be the weight of this pipe and how would it be supported for a starter.
"Stop the Spill" - do you really think that thousands of people are not working their balls off trying to do this??
Same for a commenter over at Kunstler's site that recommended a big rubber and diamond material coated plug to put in the well riser with an ROV. Let's see, 21" diameter and differential pressure at the outlet of 5,000 psi. We'll use the Popeye ROV, just a little spinach and that little guy can stuff that thing in with 300 ton force no-problemo.
Overall, physics is noticeably absent in any discussion because that was the hard class for nerds like Big Bang theory. I'm starting to wonder if cartoons has been the main source of physical science education lately...
Hmmm. "Chapter 11" is a United States statute. While I see the point, the question is, how does the country in which BP is organized (U.K.?) treat Corporate reorganization? Is it similar, or are there some other "gotchas"?
In the UK the process is termed going into administration and the primary aim is to rescue the company as a going concern (i.e. with as much as possible of its business) where it would provide the best result for the company's creditors as a whole. If this is not possible, then the aim of the administrator is to perform his functions with the objective of achieving a better return for creditors than would be achieved in a winding-up.
Some differences are;
Chapter 11 renders unenforceable any provision purportedly terminating a lease or executory contract by reason of the debtor’s financial difficulties - not in the UK.
Directors are not left in charge but an insolvency practitioner is appointed administrator with responsibility for the day-to-day running of the business and the goals of the administration. Not an easy job in the case of BP.
No concept of DIP lenders for financing.
The Mediavore's Dilemma: Making Sustainable Media Choices
http://www.pbs.org/mediashift/2010/06/the-mediavores-dilemma-making-sust...
The absurdities of modern capitalism
1) From "Obama Scolding BP on Dividend Favors Fishermen Over Retirees"
In referring to BP shareholders, retiree Miriam Sullivan says "They’re penalizing people that are innocent by cutting the dividend at this point, when they don’t even need to. It seems very political."
So, in modern America the expectation is that if I own a dog and it bites the neighbor, I'm responsible, but if I own part of a company and they dump millions of barrels of oil into the gulf, I'm innocent. Yup, I understand that.
2) Bluebonnets posts an excerpt from "BP Shareholders File Lawsuit Over Gulf Oil Spill"
Certainly not the first time this happens, but the logic is so keen it has to be admired. The owners of a company file suit against the company to recompense losses. That's right, essentially they are suing themselves because their ability to extract money from the company has been hindered. (One wonders about the efficacy of a suit that then further hinders the ability of the company to generate cash flow that could be used for dividends, but hey, that's the future.)
So, I'm thinking that tonight on the way home I'll drive into a telephone pole and then have my insurance company sue me on my behalf so that they can then pay out a big settlement to me.
Isn't capitalism grand!
Of course it's political. Does anyone think retirees are more likely to vote for Democrats than fishermen are? Especially when half of them live in the U.K. and can't vote in the November elections.
I can recall several years ago reading in News of the Weird that a guy in the US did sue himself for his car accident, and because of the way he had arranged his finances he won (as a plaintiff) and somehow net made money out of it, IIRC his insurance was involved. Wish I recalled more detail. Hard to be sarcastic beyond reality sometimes.
Energy Export Databrowser updated with data from 2010 Statistical Review
Lots of interest in the latest version of the BP Statistical Review. One of the key features of the new report is that they include datasheets for renewable energy. Those data will be incorporated in some new databrowser plots later this summer. For now we just wanted to get the updated data and graphics out to folks as soon as possible.
For me, the obvious story is the difference the last few years has made in consumption in the developed world vs. the developing world. Mature, industrial economies around the world are experiencing declining demand for fossil fuels due to reduced economic output. Developing nations, on the contrary, have seen no such reduction in demand. For the time being, the increased demand from developing nations is being offset by decreased demand in the developed world. But it is clear that any increase in economic activity in mature economies will rekindle an energy bidding war unless that increased economic activity is not dependent upon fossil fuels. It will be very interesting to see how this evolves.
To demonstrate the above, the table below will compare oil and gas usage from two groups of nations:
From the Energy Export Databrowser: (note: scales differ)
Another interesting story is the relative importance of oil as depicted in the graph associated with the Peak Oil, FTW article.
The author is correct in pointing out that oil represents a smaller and smaller piece of the energy pie each year. But that particular graph doesn't tell the whole story. The Energy Export Databrowser has some seldom used features that allow users to create "All Sources" plots and then (under the "Show Options" button) to look at either production or consumption and convert from physical units to percent. Using these features to create "% of consumption" charts we see the whole story: decreasing use of oil is being offset by increased use of coal. And, after a quick peruse, it becomes apparent that this is happening primarily in Asia.
Please feel free to use charts from the Energy Export Databrowser to help tell the stories you find in the data. On many systems you can simply drag the image onto your desktop.
Happy Exploring!
Jon
Thanks Jon, great work!
Amazingly quick work!
I was expecting it would be mid-July before the new graphs came out.
Thanks a lot!
You're all welcome!
And thanks for the compliments.
I can tell from our server logs that lots of folks come in directly (rather than from a link in some other page) and are looking for very specific information. It seems that for a moderate number of people this tool has become a valuable "go-to" resource. Once a year I'm willing to drop everything to do a quick update so that the users can rely on databrowser graphics to validate all the other quick pronouncements that are being made based on the latest BP Statistical Review.
Nice and impressive work!
Diagrams tend to improve and clarify the story.
Cool tools!
For several years after college my first 'real job' was to create and maintain the world's largest social and economic, energy, population etc database of this sort of data. We had real data 1950-late 90s with projections as far as 2005. Over 1200 indicators for every country on Earth for which data was available. Very cool job.
It also included all the FAO stats on food production and human development indicators, environmental indicators & so forth, and was unfortunately w/ the tech limitations at the time only available on CD-ROM, and had some simple graphing capabilities. I miss having that sort of data at my fingertips - thanks!
Might I ask who you were working for during that time?
I can think of several groups that would be able to get that sort of database together. But not all jobs that are available can be talked about beyond the general.
charles,
BioWebScape designs for a better fed and housed future.
Hugs from a wet Arkansas.
yay we got rain.
The latest report from Oil Movements (below) indicates that OPEC exports have increased only by about 250,000 bpd from the end of March (from 23.4 to 23.65 mbpd). This is about 1% and may even be considered a rounding error due to the estimations used by OM.
Fortunately for the US even as global exports stagnate, the US managed to out bid the rest of the world just enough to increase oil imports in May 2010 about 600,000 bpd over last year's month - although product imports decreased by about 350,000 bpd, offsetting most of the gain. My idea is that the run up in oil prices in April to near $90 was a symptom of the outbidding process, although now imports appear to be on their way to slowing down a little.
This oubidding may have to repeated again soon as distillate demand remains curiously very strong - up about 12% in May over last year.
http://money.ninemsn.com.au/article.aspx?id=1067685&rf=true
http://www.opisnet.com/fleetfueling/headlines.html
Comments that the US economy has entered some kind of deflationary death spiral are, at least for now, a bit premature.
Well stated. Decline of oil production (and production capacity) from the beginning of the Peak Oil plateau in 2005 has been very gradual. Indeed, it is questionable whether oil production capacity has declined at all since 2005. Who knows how long the plateau of current production can be maintained?
In the longer run, however, I think westexas's ELM and ELM2 models are correct. Thus imports will decline very gradually at first but then faster and faster.
And of course the corollary is that the post-2005 global Cumulative Net Oil Exports (CNOE) depletion rate is quite high. Sam's best case is that the (2005) top five net oil exporters are depleting their post-2005 CNOE at about 9%/year, and that by the end of 2013, they will have shipped about half of their post-2005 CNOE.
I should point out that crude oil imports into the US peaked out in 2006, and there has been overall a slow gradual decline since then. I view the changes in oil imports much like after the peak of a roller coaster ride - there are times when it is going back up, but it will never go as high again and the next downturn will be lower than the last.
Not surprisingly then we have lost millions of jobs in the US economy since the end of 2007, more or less about one year after peak oil use in the US. Probably the economy took a year after the peak to decline due to delays caused by embedding energy in various products and food, plus infrastructure.
Still it is quite possible, even likely, the US economy will recover some of its economic losses as long as oil remains relatively afforable. I do not consider the current $75 oil a high price, or even up to $100, an impediment to growth. Ironically, peak oil has turned the typical historical effect of a financial panic on its head - the scare over the Euro has actually made oil more affordable and increased demand.
The ELM 2.0 premise is that developing countries will continue to outbid developed countries for access to declining net oil exports. I think that the US is on its way to becoming largely free of our dependence on foreign sources of oil--just not in the way that most people anticipated.
Yes. I like to say that the US can achieve energy independence, or it can have energy independence thrust upon it. One way or the other, it's coming.
As I have said before, the fact that the developing countries can outbid the developed ones for net oil exports is not surprising: at the margin, the developed countries burn a lot of oil on low-utility activities. The US is among the worst of them, as we don't (so far) artificially raise the price of oil very much. Many of the households in the bottom quintile by income in the US can afford to drive across the state to visit Grandma; none of the bottom quintile by income in China or India can afford to put oil to that kind of use.
So I conclude that -- at least initially and at the macro level -- the economic impact of the shift will be relatively minor on the developed countries. One could argue that it should be easy to observe if this simple model is true; increasing prices should have less impact on the US than on Japan, since Japan's higher consumer taxes on oil should have already priced out much of the low-utility activity. I suspect that it's actually more complicated than that, since Japan's prices will also have driven more activities towards alternate sources of energy.
I have a feeling we're not occupying Iraq in order to let the developing world outbid us on its oil if we get squeezed on supply. IMO that's what the whole war was really about (didn't mean to hijack the thread, I'm just sayin'...)
It's interesting that we don't hear about SA's spare capacity much anymore. I think the last report I saw put it at ~5mbd, which is not insignificant, and yet there seems to be increasing worry coming from various levels of government that a supply crunch is looming sometime in the next few years.
After the last oil crisis 30 years ago the oecd world turned to relatively abundant supplies of non-opec oil, who we gonna call this time?
Cheers,
Jerry
Jerry, you can read it in 'Oilwatch monthly'. But Koppelaar just copies EIA information; that gives KSA about 4 mbd spare capacity. There are serious doubts that it will be that high, combining all the information from articles and comments on TOD the last 2 years.
Thanks Han,
The Oilwatch Monthly was in fact the report I was referring to (albeit indirectly), and as you probably surmised my list of rhetorical questions was taken more-or-less directly from various commentary I've seen on TOD over the years.
I guess I was just wondering why we don't hear about spare capacity from the cornucopian crowd as much as we used to. I seem to recall it wasn't that long ago that it was one of their favorite planks to whack peak-oilers with...
Cheers,
Jerry
I don't think this has been posted, at least on this thread
http://news.yahoo.com/s/ap/20100610/ap_on_bi_ge/us_gulf_oil_spill
Is this because they don't have the ability to handle all the oil they are taking up, or is it because the cost of dealing with the oil mixed with water is too much, or is this a misunderstanding and the 420,000 gallons being burned is gas that comes up with the oil?
At any rate aint't this great, more CO2 in the air without even doing any useful work.
"Is this because they don't have the ability to handle all the oil they are taking up,"
Yes, look at the sentence you have copied "A drill ship already at the scene can process a maximum of 756,000 gallons of oil daily" that's the Discoverer Enterprise, the grey ship with a big drill stack in the middle. The gas is separated out and burnt.
"a semi-submersible drilling rig would capture and burn about 420,000 gallons of oil daily" that's the Helix Q4000, a red square platform with a white "tower" which is being converted to burn 10,000 barrels/day of oil & gas which will come through the "top-kill" ports.
The short term choice is to either burn it or let it flow into the sea, longer term it should be captured by the floating connector to the Toisa Pisces and Loch Rannoch Tanker.
HTH
Most criticism of BP focuses on wrong and/or lax procedures, hurry up pushing, etc. But I've heard in some investment newsletters (sure, be on guard but not presumed wrong either) that " ...this blowout in the Marcellus Shale and the BP tragedy in the Gulf both involve the failure of the same vital piece of equipment - a $7 ring of rubberized plastic."
Is there really some item, an analogy to the role of the O-Ring in the Challenger Shuttle loss, that is much responsible (in part - "involve") for those events? Heard about it anywhere else? tx
Maybe Tony Hayward's parents could've prevented some of this with a $1 latex item.
They tried that but they had a blowout.
Then the guy in charge would just be another name, and you'd be talking about his parents, the never ending stream of people that fill any one job is endless at times. If not him then who? When you deal with that you can get all sorts of bad outcomes. If say Joey Crankshaft ZootMiester was the head of BP you might be asking for his head too.
At times it is better to have the person you know than the person you don't know.
Charles,
BioWebScape designs for a better fed and housed future.
Hugs from Arkansas.
There does seem to be mounting antipathy in the UK towards the way BP is being dealt with:
http://www.cnbc.com/id/37621804
From the piece:
He also said Obama had not delivered such personalised attacks on those involved in the damage inflicted on western economies by "polluted securities from the irresponsible, unchecked greed and avarice of leading US international banks.
"Perhaps a case of double standards?
"We can all agree that the first and absolute priority is to stem the leak. Perhaps the second one is to ensure the reputation of the presidency outside the US is seen as objective, balanced, able and capable of taking the heat when under pressure,'' he added.
All the talk of capping Green house emissions by X amount by 2030, is well and good, but getting it past all the nay sayers in Washington and Main street is like pulling teeth.
When if we are in the down slope of Peak Oil, the emission cuts via Oil will be part of the system anyway. Though it seems Ron P. has said that we have been using Coal more than we used too, and that as oil goes down, Coal will go up. We won't really cut any emissions via Peak Oil after all.
I am glad I don't vote republicrat or Demigods at all. But there aren't any other parties left that have a say in Washington. The greens haven't got a prez candidate that will get very far, and even I can't get on some state ballots, because I don't advertise more than online via my blog. No one is going to be doing the public any good in the coming years.
Where does a thinking person vote?
It is raining here today, nice change of events, it was dry as a bone here the last week or so, the afternoon heating showers leaving not a drop in my collection buckets. All I can do is vote with my pocket book, Buy local, buy local , buy local.
Global climate change is just going to keep getting worse and no one is going to care unless it is their own back yards that get the change going in them.
The Asia article is going to hit us in the food chain soon I'd guess, if the rivers dry up and the wheat fields fail, they will need US crops to feed them and then what will we do? Feed them I hope. But never assume what your congress critters will do in the face of evidence, they might vote for a big retirement package and wet season island escape and not do anything for the rest of us little people out here.
Needless to say most people I talk to off line, don't think their congress critters like the voters very much. They get in power in washington and do whatever they want to do, once voted in it is hard to get them to do anything you want them to do.
Likely no one would trust that I would be any better than those that could be voted in.
Oh well, only can do what you can do yourself anyway.
Charles,
BioWebScape designs for a better fed and housed future.
Hugs from a wetter Arkansas.
http://www.marketoracle.co.uk/Article20207.html
Reminds me of the Soviet scientists once profiled working on telekinetics and other psychic phenomenon. Turns out a few were in far away laboratories working on abiogenic petroleum theories as well.
Betcha these are the same officials who are mum about alien bases on the dark side of the moon.
The truth is out there. Said so on the X-files!
Sorry, mrflash818, I just can't resist a moment of incredulity.
Time to reference Eugene Island.
http://en.wikipedia.org/wiki/Eugene_Island_block_330_oil_field
Methinks the last line puts Eugene Island into some kind of perspective:
Then again, as Shakespeare once quipped, "There are more things in heaven and earth, Horatio, than are dreamt of in your philosophy." And, on a similar note, to quote Oliver Cromwell, "Gentlemen, remember! By the bowels of Christ, remember! You might be mistaken!"
There really maybe alien bases on the dark side of the moon but I'm not holding my breath for the day of their discovery.
"Migration Channel" is a mistranslation of the Russian. The correct term is YHWH.
YHWH - "I am that I am". Boy, the translators are way off the mark with this one.
Abiogenic oil did to Russian geology and seismology what Lysenkoism did to Russian biology and agronomics. I'm amazed a proponent of that theory made it to an academic post in Sweden.
And therefore a nutcase and not worth the listening.
Hot off the digital presses...and a surprise to anyone here at TOD?
http://www.cnn.com/2010/US/06/10/gulf.oil.spill/index.html?hpt=T1
Oh ya...and Costner has started selling his centrifuge machines to BP.
http://www.examiner.com/x-19632-Salt-Lake-City-Headlines-Examiner~y2010m...
It seems to be one of those times when celebrity works against you. Really, how long does it take to assess one of these machines? It could have been done in an afternoon given the circumstances.
I despair for the species...
Oh ya... Mr. Costner... some people will do anything to hog another fifteen minutes of fame.
Is it my imagination or is this BP fiasco moving into a some warped version of the Twilight Zone? You just can't make this stuff up.
It would be even more bizarre if it turns out these machines really do work. Who'd thunk it??
Actually, the machines appear pretty simple and legit. Don't discount the technology just because Costner is behind the funding.
Dragonfly, with all due respect to Kevin Costner, I don't discount that possibility. That's why I say that it would be even more bizarre if the machines work.
No one could script that a Hollywood actor would come up with a patent that would help to save the day. Next thing will be to sell the story for an upcoming mini-series.
As I said, like out of the Twilight Zone.
Cheers!
It's just more spin ;^)
Seriously, it's just an expensive centrifuge, it should work in principle.
It's not a very original idea either...
Had an old Centrifugal cream separator back in the '70's. Hand cranked, worked beautifully. I'm pretty sure that the inventions go back even further than the patents you quote.
You do know that some hollywood actors had real jobs before they became actors don't you? Look at Harrison Ford, a carpenter, was good with a hammer and a saw. Did work on his own house later on in life.
Just because they have a star on the walk of fame does not discount them from having other talents. You don't know this but ideas come to the people who have little or no formal education and they at times can save the day with them. In this country as well as elsewhere we have a mindset that, if you are a waiter, you can't be a chef. If you are a gardener you can't be a pilot. If you know how to lay stone blocks you can't possiblly be good at anything else but laying blocks in the ground.
Why is that?
Charles,
BioWebScape designs for a better fed and housed future, where someone's worth is not measured by their job.
Hugs from Arkansas
The actress Hedy Lamarr held a patent issued in 1942 for a spread-spectrum frequency-hopping secure radio system. It wasn't a totally novel concept at that time, much like the centrifugal water cleaning system that Mr. Costner is promoting (see the British inventor James Dyson who applied cyclonic centrifugal principles to household vacuum cleaners for a previous example of the art).
As for these water cleaners I don't think they're a "magic bullet" solution to the oil dispersed in the Gulf. They are likely to be used on the larger concentrations of surface oil which are coincidentally the most cosmetically untidy ones. The job of removing the majority of the oil from the water, the beaches and the salt water marshes will be done by bacteria chomping down on oil droplets that have been created by breaking up larger clumps of oil with dispersants and that job will take decades.
Charles,
There's no disputing that actors are real people with diverse talents and thinking brains. But the profession is one that works inside the world of make-believe.
Actors are practitioners of the art of camouflage and subterfuge (it is their job after all). Likewise, it is well and right that people do approach them with a measure of discernment and wariness. Caution is always advisable since it is within the power of the mask to deceive.
Besides, many celebrities are publicity hounds who use their high profiles and name recognition to peddle their soap box causes and hence come across as flaky as pie crust.
Tom
wrt the centrifuges: This idea might be of some use for oil on the sea surface...how much of the spilled oil is emulsified in the water column? And how long will it take to build these machines?
Turn off the darn dispersant hose jets at the well head and spot spraying the dispersant on the water.
The barn door has been open for 52 days in this incident and many many horsies have run away...
LA leaders beg for deep water drilling to continue (and expand, I'm sure):
http://www.msnbc.msn.com/id/37625734/ns/business-us_business/
These folks aren't even willing to wait 6 weeks to take a breather and try to do some root cause analysis and inspections and make some new rules...
For crying out loud, have the USG step in and cover all the oil service industry workers on special unemployment at full wages for two or three months or whatnot.
Cover this by printing moolah immediately, then take it out of BP's hide...if BP folds and its assets 'disappear' before we get to them, then we cover the super-unemployment and other costs by levying a permanent surcharge on all oil used in the U.S.
These folks want to have it both ways: Bitch about the oil spill damages while demanding that we mash the pedal to the floor to continue DW drilling even before the DWH spill is shut off!
BTW, HP is planning to lay off thousands of more workers, and I'm sure the auto industry is not done bleeding out either. Life is tough all over, but no one is crying crocodile tears over the tens and tens of thousands of other-than-oil-industry workers who lose their jobs for good every year...
I would wager that most of these politicians demanding that their workers go back to work at any cost also happily voted to not extend unemployment benefits for other workers in the country...for them the message was 'get off your butt' and 'get a new education' and 'we can't spend our children's inheritance on you'. Now they are willing to take any risk, any cost to keep their constituents employed.
keith olbermann ....
http://www.youtube.com/watch?v=a_uMg84BBzE&feature=player_embedded