Drumbeat: January 15, 2011
Posted by Leanan on January 15, 2011 - 10:43am
Oil reserves have been declining for a decade, and it is an article of faith among petroleum geologists that the easy oil — easier to find, less complicated to drill — has all been extracted and that the explorers are now into the hard oil. When the Deepwater Horizon rig, drilling an exploratory well deep into rock through a mile of water and three miles into the ocean floor off the Louisiana coast, struck a highly pressurized pocket of oil and gas, causing an explosion, it was in some ways a consequence of this iterative, competitive game, each generation of discoveries pushing further into the unknown.A few years ago, the industry norm was to drill at depths of 15,000 or 20,000 feet. Now the frontier is 35,000 feet, where engineers find higher temperatures and pressures. “The scarcity of new reserves has been driving companies into plays that have previously been seen as extremely high risk and high cost,” said Brian Maxted, the chief executive officer of Kosmos Energy, a deepwater-exploration company in Dallas. “The trend recently has been in going toward ever-deeper waters and ever-more challenging environments.”
Venezuela: no need for emergency OPEC meeting
(Reuters) - Higher global oil prices do not threaten the global economic recovery or require an emergency OPEC meeting, Venezuelan Energy Minister Rafael Ramirez said on Saturday.Ramirez told Reuters the South American producer still believed $100 per barrel was a "fair price," while the differential between the Brent and WTI levels showed the need for a new price measurement based on a basket of currencies.
Please. How many times does OPEC have to play this game for guys like Williamson to catch on to the con? OPEC isn't sitting on its hands because they don't want to take our yucky devalued dollars. In the short term they can hedge against the dollar just like anyone else if they want to, and in the long term they can invest the surpluses in their sovereign wealth funds in any instrument they feel like. The reason for their apparently lackadaisical attitude is much simpler: they're already pumping at near their maximum production capacity.
Judge Refuses to Order BOEMRE to Speed Up Deepwater Permitting
U.S. District Judge Martin Feldman on Thursday refused to order the Interior Department's Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) to speed up processing deepwater drilling permit applications, ruling that it was unclear of BOEMRE must approve or reject drilling permit applications within a certain time frame, media reports said.
US left wounded as Putin seals BP deal
The fingerprints of Russia's Prime Minister are all over the agreement between BP and Rosneft. But what does it mean for the future of oil?
BP's Rosneft Deal Replaces Reserves Lost in Post-Spill Sales at Half Price
BP Plc’s $7.8 billion share swap with OAO Rosneft will replace almost all the reserves it sold to pay for the Gulf of Mexico spill at less than half price.
American hostility grows over BP's deal with Russian state oil company
Britain's leading oil company, BP, is facing hostility and suspicion from the US over an alliance with the Russian state oil firm Rosneft that opens up vast areas of untapped wilderness off the coast of Siberia and beneath the Arctic shelf.
BP aims to calm shareholders' fears over Russian deal
BP's chief executive, Bob Dudley, is to lead an investor roadshow to calm fears over the £10bn share swap with Russian state-owned energy giant Rosneft.Some investors have reacted angrily to the deal, announced late on Friday, which will see Rosneft take a 5 per cent stake in BP. Additional stock will be issued, diluting the stakes of existing shareholders.
Analysis: Energy Stocks Finish 2010 on Positive Note
Despite a poor start, more than 65 percent of oil and gas stocks delivered positive returns last year, according to the IHS Herold 2010 Energy Peer Group Stock Market Performance Report. Driven by economic growth, crude prices, which hit bottom in late May 2010 at around $65 per barrel, rose steadily and consistently through the second half of the year, and took oil company shares with them.
Are triple-digit oil prices really a given in 2011?
“Maybe it will be US$126, or maybe it will be US$152, but I think that we will be comfortably in triple digit oil prices by the first half of the year. And by the second half of the year, prices will be getting close to [$147], maybe even above.’’If he is right, triple-digit oil could have the kind of grim economic and social ramifications that he has already outlined in his best-selling book Why Your World Is About to Get A Whole Lot Smaller.
Tunisia hit with looting as new leader sworn in
TUNIS, Tunisia (AP) — Looting, deadly prison riots and street chaos engulfed Tunisia on Saturday, a day after mass protests forced its strongman to flee. A new interim president was sworn in, promising to create a unity government that could include the long-ignored opposition.It was the second change of power in this North African nation in less than 24 hours.
Pemex Reopens Two Gulf of Mexico Oil Export Terminals
Petroleos Mexicanos, the state-owned oil company, reopened two Gulf of Mexico oil export terminals after weather conditions improved.
Fuel Tanker Drivers Strike Threatens Petrol Shortage
BRITAIN faces the nightmare prospect of petrol shortages after a strike ballot was called yesterday by oil tanker drivers.The Unite union said balloting is likely to start next month in the row over pay, pensions and working conditions.
Gas scarcity impeding industrial growth
Islamabad—Scarcity of gas is causing problems both for public and industries and the authorities concerned should take measures to ensure uninterrupted supply of gas for the economic growth of the country. This was stated by Mahfooz Elahi, President, Islamabad Chamber of Commerce and Industry while presiding over a the chamber here on Friday.He was of the view that the gas as well as the electricity shortage is also causing the closure of a number of industries and small and medium enterprises. He claimed that this problem has resulted in the loss of more than 400,000 jobs and is inflicting on the industrial sector alone an annual loss of over Rs 220 bln. The ICCI President was of the view that trouble lies ahead for domestic, industrial and commercial sectors unless the shortage of gas is addressed.
Pakistan: People start using coal and firewood as fuel
People, facing immense problems due to scarcity of gas, have started using alternative energy sources like coal and firewood for preparing food and heating their houses.Ironically, the purchase of firewood and coal has become an additional burden on the people. For instance, besides paying gas bills despite being deprived of the facility these days, they are spending money on the purchase of firewood and coal to keep themselves warm and prepare their meals.
EV costs in CA outweigh gas prices
As much as we all want to champion the underdog, there’s always a downside. Such is the case for plug-in electric and hybrid vehicles. As awesome as they sound, they will require a lot of juice. Will the amount of electricity they consume make them more costly to maintain than they’re worth?Wally Tyner, professor of agricultural economics of Purdue University, says yes—but primarily for Californians, who pay some of the highest electricity charges in the country.
Britain is becoming less windy, raising doubts over Government's wind farm strategy
In November, Scotland's first minister, Alex Salmond, spoke of wind's "massive economic rewards" in a "renewables revolution". In May, the wind industry trade body, RenewableUK, called the North Sea "the Saudi Arabia of wind".Yet it can be revealed that as the rhetoric has climbed ever further up the Beaufort scale, the wind itself has moved in precisely the opposite direction. New figures published by The Sunday Telegraph show that 2010 was, by one authoritative measure, the least windy year since 1824.
World hunger best cured by small-scale agriculture: report
The key to alleviating world hunger, poverty and combating climate change may lie in fresh, small-scale approaches to agriculture, according to a report from the Worldwatch Institute.The US-based institute's annual State of the World report, published yesterday, calls for a move away from industrial agriculture and discusses small-scale initiatives in sub-Saharan Africa that work towards poverty and hunger relief in an environmentally sustainable way.
How shale gas can trump oil sands
Chen Weidong, an influential policy guru at government-controlled China National Offshore Oil Corp., has a blunt message for oil sands companies and investors: Get out.The future, he says, is natural gas trapped in shale rocks.
"The oil sands are too costly and too polluting," Mr. Chen said in an interview with the Financial Post at CNOOC's shiny, modern headquarters near the centre of Beijing. "Gas has a brighter future.... Shale gas is much cheaper and cleaner.
"I'm not in favour as much as before toward Canadian oil sands because of shale gas."
OPEC ready to act but not due to speculators: report
(Reuters) - OPEC is ready to act to address supply shortages in the oil market but not to counter price moves caused by speculation, Secretary General Abdullah al-Badri told an Austrian newspaper. The group is monitoring the situation closely, and "OPEC will intervene to stabilize the market if the market is imbalanced. OPEC will not intervene because of speculators," he told Wirtschaftsblatt in excerpts of an interview posted on its website on Saturday.
No good substitute today for hydrocarbons, nuclear energy - Kapitsa
MOSCOW (Itar-Tass) -- No adequate substitute for the fossil fuels and nuclear energy exist today, an associate member of the Russian Academy of Sciences, Andrei Kapitsa, told Gazprom magazine in an interview.
Crude Oil Caps Biggest Weekly Increase in Six as Factory Production Rises
Oil edged higher in New York, capping the best week in six, as U.S. industrial production rose more than forecast in December in a sign that fuel demand will strengthen.
Crude Oil May Decline as U.S. Refiners Replenish Stockpiles, Survey Shows
Crude oil may decline next week on speculation that U.S. refineries will bolster supplies after an end-of-year clearing of storage, a Bloomberg News survey showed.
Southern Sudan's Independence Vote Nears End as North Expects Secession
Southern Sudan’s weeklong referendum on independence entered its final day, as a top official of President Umar al-Bashir’s ruling party said he expected the oil-rich region to secede and form Africa’s newest nation.
Venezuelan gov't to offer $6 billion in bonds
Venezuela's government says the state oil company has been given approval to sell up to $6 billion in bonds to raise money to be used in currency trading.Petroleos de Venezuela SA has periodically sold bonds both to raise funds for needed projects and to make dollars available in the tightly controlled local currency market.
Spill Report Accuses Jindal of Showboating
Jockeying by Gulf Coast officials for limited oil spill-fighting resources and the construction of a massive chain of sand barriers to block oil offshore — a key priority of Gov. Bobby Jindal of Louisiana — did little to protect the coastline and often hampered the more effective actions of federal responders to the 2010 oil spill, according to the final report by the presidential panel investigating the spill.The report, released on Tuesday, also details new allegations that Mr. Jindal deliberately withheld the location of an area of oiled marsh from the Coast Guard that he used as a backdrop for television interviews.
Enbridge hikes spill cleanup cost 28%
Enbridge Energy Partners LP boosted its estimate for the cost of cleaning up a July pipeline spill in Michigan by 28%, to US$550-million.
Greenpeace criticises BP over Artic deal with Rosneft
Environmental campaigners Greenpeace slammed BP on Saturday after the British energy firm signed a huge Arctic exploration deal with Russia, just nine months after the Gulf of Mexico oil spill disaster.BP and Russian state-run firm Rosneft unveiled an agreement late Friday to swap shares and launch a joint venture to exploit the Arctic's vast untouched energy resources.
Two decades on, Kuwait seeks better Iraq ties
KUWAIT CITY — A landmark visit to Baghdad last week by Kuwait’s prime minister is seen by many Kuwaitis as a good sign of improving relations, 20 years after Iraq’s invasion of its tiny, oil-rich neighbour.“The visit of Sheikh Nasser (Mohammad al-Ahmad al-Sabah) to Iraq was indeed historical,” the liberal Al-Jarida newspaper said in a front-page editorial on Friday.
Jeremy Grantham On Ignoring Eisenhower And The Two Most Dangerous Industries In America
The financial resources of the carbon-based energy companies are particularly terrifying, and their effective management of propaganda goes back decades. They established and funded “independent” think tanks and even non-profit organizations that have mysteriously always come out in favor of policies favorable to maintaining or increasing the profits of their financial supporters.The campaign was well-organized and has been terrifyingly effective. And the results speak for themselves: which other developed country has so little gas tax? Not one. And better yet, which other country now accepts the myth that good red-blooded Americans will never stand for such a tax? That is the real art. It has created an environment in which we cannot aspire to the social responsibility – and a higher gas tax is simply that – of, say, the Italians (the most agreeable people on the planet, in my opinion, but not noted for making tough political decisions). Which other developed country has had no improvement in fuel efficiency because it has reinvested the considerable technological advances in heavier SUVs, with no real need for most other than the nurturing of their macho instincts? Not one.
The third Industrial Revolution
Beyond immediate concerns about rising oil prices and climate change, the threat of peak oil is looming.Virtually every aspect of our economy and society is dependent on fossils fuels - from the energy used to produced heat and electricity, to the products that we manufacture and consume.
Globally, most experts agree that we will reach peak oil production by 2020, or earlier. As consumption of oil continues to increase, this will create a gap between production and consumption. If current trends continue, economic chaos and global conflict will follow.
Global warming: A problem of belief
This problem is fast approaching; waiting can be dangerous. Peak oil is now here and peak coal energy probably only a decade away. Experts from all countries agree that significant action must be taken in the next 10 years by each of us. Our dependence on fossil fuels is going to end, with or without our action. It will be painful either way but less so if we take charge of the upcoming changes and do what is needed.
Toyota Developing Motors Without Rare Earths for Electric Autos, Hybrids
Toyota Motor Corp., the world’s largest seller of hybrid autos, is developing an alternative motor for future hybrid and electric cars that doesn’t need rare-earth minerals at risk of supply disruptions.
US, China energy firms to ink deals during Hu visit
WASHINGTON, Jan 14 (Reuters) - American and Chinese energy companies will sign several commercial agreements next week during Chinese President Hu Jintao's state visit to Washington, a U.S. official said on Friday.The deals will involve trade in renewable energy, an area where the United States and China are competing for market share.
Dong Energy, Scottish & Southern Start Wind Farms Off U.K.'s Shoreline
Dong Energy A/S, Denmark’s largest energy company, and Scottish & Southern Energy Plc, the U.K.’s second-biggest power producer, said wind farms off the east and west coasts of England sent their first power to the U.K. grid.
China Mints Two Wind Power Billionaires As It Overtakes The U.S. In Capacity
This week’s successful stock listing by Sinovel Wind Group, a Chinese maker of wind turbines, has added two billionaires to the country’s growing ranks.
France to Unveil Tenders for 2-3 Gigawatts of Offshore Wind Power Projects
Speaking at a press conference in Paris, he also said that solar energy development in France needs to be “better regulated” so that costs to consumers are lowered. New rules on development may be made public by the middle of February, he said.
EPA says Texas plants won't see delays in permits
Despite a heated dispute between the U.S. Environmental Protection Agency and Texas on how to regulate pollution, coal-fired power plants and oil refineries aren't likely to face delays as the agency takes over greenhouse gas permits in the state, an EPA official said Friday.
EPA gets citizen backing in Texas greenhouse-gas dispute
Scores of Texans on Friday backed the Environmental Protection Agency and blasted Texas officials at a hearing in Dallas on the federal takeover of greenhouse-gas permitting in the state."The federal government has to do it because the state government has failed," Dallas County Treasurer Joe Wells told EPA officials.
Nicholas Stern Warns Of Greater Climate Costs
The price of fighting climate change is even higher than what was estimated in a 2006 study, said British economist Nicholas Stern, who earned an estimated 500,000-dollar Spanish award on Friday for his work.
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India to raise petrol prices by 4.5 pct -sources
http://af.reuters.com/article/energyOilNews/idAFLDE70E07V20110115
Tunisia redux.
Why didn't the Iranians freak out like most nations when their sanctions got cut and the price of fuel skyrocketed?
I live in India. The beauty is that people are pissed with the government for 'increasing the prices'. What is likely to follow is that the opposition party will promise to reduce prices and (yay!) fail too.
I love slowing down.
"I love slowing down."
I like this mantra!! It is why I love a good 6-12" snowstorm. If FORCES people to slow down and on occasion, get out and help someone (stuck cars, elderly neighbors, etc.). It forces people out of their mundane routines and for adults to revert to their forgotten inner child.
This is one of the few "benefits" that could arise from perpetually increasing fuel prices. Slowing down and assessing our fuel use choices more consciously. In some cases, this will lead people to try to help one another more. In other cases, this could lead to the opposite.
The beauty is that people are pissed with the government for 'increasing the prices'.
There is some justification for that. In India, taxes on petrol are very high. Also, recently a large number of financial scams have been exposed in which the tax payers have lost billions. There is a strong belief that the government can easily afford to reduce taxes on petrol if they could stop hemorrhaging money via corruption and scandals. Another issue is that a large amount of food (up to 50%) produced in India just rots or is eaten by rodents. The government does not have proper storage facilities to store food when there is a surplus. They let is rot out in the open instead of giving it away to the poor. Now food is expensive and people are justifiably angry.
Most of (developing/developed) India uses liquefied petroleum gas for cooking. Every cylinder of gas costs as much to the country as it does to the consumer. The taxes, i believe, are not high given this situation. The ones who complain about petrol taxes are those who want to continue to drive... and they aren't many, really (in comparison to the many that have come to depend on cooking LPG). Additionally, again on a big subsidy, the really poor also get Kerosene for cooking.
http://www.eia.doe.gov/cabs/India/Oil.html
I'm just waiting for Diesel prices to be deregulated next... :)
Most of (developing/developed) India uses liquefied petroleum gas for cooking.
Many good reasons for this.
Ease - going out, getting, storing, then using wood/charcoal is a hassle.
Health - wood smoke
The traditional way one makes charcoal is not all that "green" and the preferred cooking fuel is charcoal.
The stripping of the land for every twig to heat will push many areas into desert.
regarding Global warming: A problem of belief, above:
"..the solution will take all of us." While I agree, good luck with that. The only comment so far:
Maybe after the real pain sets in .........
Funny how the author makes the switch from global warming to peak oil; been a TOD lurker perhaps. Anyhow, the article is a nice synopsis of our collective predicament, though no surprises here.
Ghung;
I wonder if he read McDonough's 'From Cradle to Cradle; Remaking the way we make things' .. as that book ends with the line 'It'll take all of us, and it will take forever. But isn't that the point?'
There are times to make some pointedly idealistic proclamations, but you have to set the tone so your reader can take it in the spirit it's made for.. and you have to be ready for the Snark-torpedoes that will be headed in.
Boy, the comment by Weston on that article (only one there when I read it..) is a doozy. I can't be bothered to register so I can reply, but if someone does, I hope they can be decent about it. The flame-potential is listed as HIGH this winter.
I handled it ..... and tried to be decent. Tried.
The US Government has moved from a stance of mitigation (reduction) to one of adaptation. Though no one has come out and said that mitigation cannot and should not be part of the overall process, nearly all of the federal resources and guides are now geared to adaptation and attmpting to anticipate the degree of global warming/climate change that will appear over the short, medium, and long term.
Ghung, does it matter? Man made, natural or caused by aliens the result is the same, nothing will be done until the problem becomes existential and then it will be too late. The millions of words and hot air expended upon the subject are just a waste of time. The only thing that counts is personal action, whether they believe or not makes no difference as it's only the action that counts.
All I want to know from the Climate debate is what to expect from the climate. To date, my own conjecture has been more useful than anything coming out of the IPCC. So I put the whole climate debate down as an epic fail by everyone, which brings to mind Shakespeare's words "A plague on both your houses! I am sped.".
It's down to us as individuals to do what we can for ourselves and forgo the hopium of being saved by collective action.
the problem with this philosophy begins with us being over the limit already. that means we have to actually go backwards, but we were raising CO2 levels even at 1850 and earlier economic levels, and that with 1.2 billion people. if society falls completely apart, relatively, we'd still be adding carbon to the atmosphere most likely as personal and local efforts to survive lead to burning of whatever it took to survive/keep a local economy going.
the only hope in the end is to collectively power down. if we do that, we can actually begin to sequester carbon. if we can do that at a fast enough rate to prevent hydrates from getting completely out of control, then we can re-stabilize climate.
in other words, the only hope is to have hope.
the only hope in the end is to collectively power down.
Ahh, but the 20-30% of the workforce who "is government" will tell the masses they need to have energy so they may rule/implement the laws.
Does anyone here think the "government" class will willingly lower their energy consumption at a rate greater than the ruled?
if we do that, we can actually begin to sequester carbon.
And how exactly will that happen?
A higher powered society could sequester carbon AND have improved soil fertility with biochar (Assuming the biochar advocates are right and Dr. Inghram isn't right). But moving topsoil is energy intensive - and mass soil moving destroys the fungi and other critters needed for good soil conditions.
But societal value would have to be put on farmers, farmland and...well....the biochar people would have to be right. Alas, I do not see the society changing the support of the parasite class of Wall Street. (As an example of the many parasites)
And as one person who works farmland on TOD put it - that charcoal is heat, I'll burn it 1st. As my old man put it "you are building a thing to make charcoal when you can buy a bag for $8"? (and *MY* charcoal maker only "works" because its time + scrap metal + free "landscaping" woodchips. The result is good for a biochar base, not cooking.)
i don't care about the political argument, it's just a declaration of impotence. we are the government and the only thing preventing us calling the future is our refusal to walk outside and talk to our neighbors and to demand the changes needed. this won't happen from the top down, but from the bottom up, as it already is.
we can use bio-char, but it's not a solution i put much faith in. a soil amendment, yes, but the idea of burning something to make it a sink is just wrong-headed. we can sequester more by simply putting the whole log in the ground, and we can do that with hugulkulture, no-till, mulching, green manures, cover crops, natural building (tying up wood/straw in buildings), etc. we also can restore sinks in the form of rebuilding lost ecosystems, particularly forests of all kinds, and address food and carbon with edible forests.
but the biggest change is to simply stop consuming. the problem with renewables discussions is that they are always about replacing current production. if we reduce that need to 20 percent of current, it's a much easier target to reach.
it does require realizing the future must be different. it does require being real, true activist citizens.
likelihood? irrelevant. it's the only choice we have.
but the idea of burning something to make it a sink is just wrong-headed. we can sequester more by simply putting the whole log in the ground,
This statement shows you do not understand the biochar argument.
The biochar advocates are pointing out the char out-gas material can be converted into fuel/other things. Thus the charing is not just for char's sake.
The other part of the biochar argument is the char remains in the soil for many more years than a log would. 100's of years VS 10's of years for your log example. The deeper you bury the char, the longer it'll stick around. If you expend the energy to go deeper than a foot, you'll break up the deadpan in most long-worked ag land. And Chared tomato stalks, potato tops, watermelon stalks and stems from sunchokes means the tomato/potato/watermelon viruses won't be transmitted and the stalk boring critters in the sunchokes don't get to complete their lifecycles.
In fact there is a whole growing system based on the log method - http://www.richsoil.com/hugelkultur/
Sounds like you have a bad case of "government is always the problem". At least in a properly functioning republic, the governments job is to apply the popular will, which in our hypothetical is to drastically cut carbon consumption. A bigger issue is getting the population of "don't tell me what to do types" to comply. I think the reverse of what you imply would happen.
Given that we do have no-carbon energy sources (nuclear and renewables) available your govermnet class could use them, and the rest of the population would pay for it.
Sounds like you have a bad case of "government is always the problem".
Government is not always the problem. Jack-legs trying to strip the pubic commons to line their own pocket are far more of an issue.
You'll note I believe that Government backed mandates to provide a service result in abuse. Examples of this are the 70% waste for Carbon reduction projects. Or the rise in costs for providing water or electrical service VS the public sector provided versions.
An example of the parasite class when it latches into pubic service.
http://www.theredmountainpost.com/the-taj-mahal-of-sewer-treatment-plant...
Let's wait until we have a small properly functioning republic before we make it any bigger, shall we?
http://www.reuters.com/article/idUSTRE70E0YQ20110115
OK, someone reads this and thinks, "Oh shew, rising prices are just speculation. We've got plenty of oil, no imminent shortages. It's just those damn speculators."
http://www.liveoilprices.co.uk/oil/oil_prices/01/2011/wti-oil-futures-en...
Then someone reads this and thinks, "Wait a second, I thought it was the speculators and OPEC says the markets are well-supplied."
Typical mixed messages and one has to think that either someone is not being truthful here or they are ignorant.
Someone should ask Abdullah why Saudi Aramco doesn't simply bypass NYMEX, and instead sell oil at whatever price the refineries are willing to pay and in one fell swoop eliminate the middlemen speculators.
I still don't understand how the futures market can affect the long term price of oil as very litte physical oil is being traded there. Supply and demand, and at times OPEC cutbacks, are in my opinion the only thing that can affect long term prices.
Someone should ask Abdullah why Saudi Aramco doesn't simply bypass NYMEX, and instead sell oil at whatever price the refineries are willing to pay and in one fell swoop eliminate the middlemen speculators.
In your own words, please explain what this is: http://www.opec.org/opec_web/en/data_graphs/40.htm
Your link doesn't tell me what determines the OPEC basket price of oil. Speculators or supply and demand? If it's supply and demand, then Abdullah is full of it.
Someone should ask Abdullah why Saudi Aramco doesn't simply bypass NYMEX, and instead sell oil at whatever price the refineries are willing to pay and in one fell swoop eliminate the middlemen speculators.
Saudi Arabia does not sell oil on NYMEX, it does eliminate middlemen and it does sell oil at whatever price the refineries are willing to pay. Traders who get hold of Saudi Arabian oil may resell it on NYMEX, but that's their business. It's foolish to think that the US determines world oil prices. The US is forced to follow world oil prices like all other oil-importing countries.
I still don't understand how the futures market can affect the long term price of oil as very litte physical oil is being traded there.
The futures market doesn't really determine the future price of oil. It is just a guess by traders on what the future price of oil will be. However, the traders - being professionals - are right more often than they are wrong. It's just like playing high-stakes poker.
So blaming speculators for the high price of oil is false, and anyone claiming this is wrong.
When oil reaches a price so high that it causes widespread defaults and bankruptcies again what are they going to blame it on? Housing bubble 2? Chinese housing bubble?
Haven't you left out the PIIGS defaulting on their bonds because tax revenues have fallen flat???
E. Swanson
Careful. Future price is not current price. Leveraged speculators can get themselves into funny boxes, where if they guess wrong, they are forced to buy, and buy, and buy, or sell, and sell, and sell. This can lead to short-term price swings that disappear in the longer run.
"The futures market doesn't really determine the future price of oil. It is just a guess by traders on what the future price of oil will be. However, the traders - being professionals - are right more often than they are wrong. It's just like playing high-stakes poker."
Ilargi took a poke at this question this week:
Well, simple person that I am, I thought that the large cumulative shortfall in crude oil production between what the world would have produced at the 2005 rate and what was actually produced contributed to the runup in oil prices--plus declining net oil exports, with Chindia's share of what was net exported rising from 11% in 2005 to probably around 19% to 20% in 2010.
I'm a simple person, too, but even I know that there are multiple forces at work and ascribing the price run up to just one makes no sense to me. However, start from the place the Jeffrey starts from, namely:
then consider a voracious world appetite for oil and you've got a good start. Add in speculation for flavor and voilà, a global oil price spike. It's a simple recipe, really.
Source: http://www.aspousa.org/2010presentationfiles/10-8-2010_aspousa_KeynoteEn...
I agree it is both, speculation and fundamentals, that are driving prices, but speculation does not work if there are no concrete reasons to speculate the future. My intention up top showing the two articles is how confusing and somewhat opposing those two articles are to the "average" news observer. At the end of the day, the message is muddled, which for some is probably the way they would like it to stay.
Like westexas I'm a geologist so I'm forced to keep my thinking simple. Last week the weatherman "speculated" that there was going to be a big snow storm hitting New England. He made this "bet" not with $'s but with his reputation. And Shazam!!! Heavy snow in New England.
So a simple observation: the weatherman obviously doesn't make it snow just as oil speculators by and large don't actually buy oil at the price they bet on. So how big a factor in making it snow was the weathermen's snow speculaion? There does seem to be a clear relationship between both oil and snow speculation with the actual outcomes. Cause and effect? Hmmm...maybe not so much.
There's also another parallel between the weathermen and the oil traders. Local weathermen actually don't model the future. They just repeat the reports put out by the National Weather Service. Oil traders also exist in a world dominated by the actions of the big trading houses. If the big houses and the NWS make a prediction (speculation) how many indepedent thinkers will bet otherwise.
Reminds me of the old saw about the shaman who becomes very powerful within his tribe by going down regularly to the riverfront to make a great show of boldly commanding the water to flow downhill.
Yeah but then into the picture comes ROCKMAN, who is standing there behind an oil barrel, with a ladle, doling out minute portions of rapidly diminishing sour crude into the little cups, held in the trembling outstretched hands of the poor consumers, and arbitrarily shouts out "NO OIL FOR YOU!" in his best imitation of the 'Soup Nazi'
How then is the spice of speculation going to flavor such a very thin soup?
Futures contract bought = futures contract sold.
The sum of all futures contracts equals zero.
Rgds
WeekendPeak
FM - A confession: I relish the thought of oil speculators getting burned to death. Can't explain why. It's not the profit: their making an obscene profit doesn't bother anymore than me making an obscene profit. The public's glutony for oil has gotten them where they are...they get to lay in the bed they made.
I guess I don't have a problem being the hawk sinking it's talons into the public's wallet. But speculators are the buzzards feeding on their dead remains. LOL. Guess that's just my preditor's ego showing.
The funny thing is that "oil speculators" as a group do not make a profit, or a loss for that matter. In futures trading (which is what I assume you're talking about) the sum of the gains equals the sum of the losses.....
As a group futures traders make/lose zero.(absent commissions)
It is the middlemen - the brokers - who make money on trading in the form of commissions.
Rgds
WeekendPeak
Regarding a number of the questions and points from different comments and commentators above...I have studied the futures market and asked myself many of the above questions, although I prefer to invest in Canadian oil companies, here is what I have concluded about the above;
1. As some above have pointed out, futures is a net zero sum game. One bettor wins (bets on black) while the other loses (bets on red) and the dealer wins a little on average on each bet (green).
2. The market for physical deliver is very thin, so OPEC and the refiners actually use the futures market as a strong indicator of where to price currently. This may seem circular as the futures market uses current delivery prices as part of its future expectations on future prices. However, in reality it is no different than many markets. For instance, if I want to buy Verizon stock, I would value it based on where it would be in the future and yet where someone expects it to be in the future is influenced by where it is today, as well as it's past trendlines.
3. Speculators are a good thing for those who are concerned about peak oil (such as myself) because the futures market and speculators can serve to drive up prices in advance of actual supply demand imbalances or shortages.
The higher the oil price the more likely there will be increases in supply and decreases in demand. Thus, this is an important, and in terms of peak oil an extremely vital, self regulating function of the marketplace. That is not to say the self regulating function will make things easy at all, just somewhat easier than if there were no expectations of the future in current prices.
4. It is the countries with no speculators and no free oil markets which may cause even more problems in terms of the world's adjustment to peak oil. Where prices are held artificially low by governments (some of whom reasonably fear riots and chaos, as recently in the news) then demand will not adjust to higher prices. This will likely mean these Governments will print money, and the money becomes worth less and less in terms of value and also what needs to be paid for oil in that currency. Thus even higher oil prices, growing debts, growing deficits, growing financial pressure on Govts and growing taxes as their short term solutions become long term problems.
I have no problem with the predators or even with the buzzards, they both have their natural place in the ecosystem and help to keep things in balance.
To me the speculators are more like invasive parasites in overshoot. Like the slimy marine hagfish sucking the life out of native lake trout in the Great Lakes where they have no natural predators to keep them in check.
Like the slimy marine hagfish sucking the life out of native lake trout in the Great Lakes where they have no natural predators to keep them in check.
Hagfish are salt water and go after the dead. They are quite low on the evolution tract and slow to reproduce. And their slime production is the stuff of legend - enough to gag a shark to death.
Perhaps you were thinking of Lampreys?
Indeed! Yes, you are correct, I was thinking of Sea lampreys and not hagfish. However lampreys are marine organisms as well.
Ilargi is simply wrong. Speculation does affect short term swings in the futures market. And on some occasions, but no always, this also causes short term swings in the spot market. But the futures market cannot affect long term trends in the oil market. That is simply impossible because producers sell at the highest price they can negotiate and buyers buy at the lowest price they can negotiate. Less oil on the market means the producers can get a higher price and vice versa. It is that simple.
And for Rockey who wrote...
No, they are wrong just as often as they are right but because of commissions, over the long run, they are losers.
An Analysis of the Profiles and Motivations of Habitual Commodity Speculators
During the day between 1000 and 1500 contracts a minute are traded on the NYMEX, and at night on electronic trading about half that many. But that is contracts, not bets. Every contract represents two bets placed. So during trading hours between 2000 and 3000 bets are placed every minute. And every one of the betters are trying to guess which way the oil market will move. They are right exactly half the time. The better ones win more often than they lose but because of commissions they eventually lose.
Ron P.
At the level of the front month contract traders usually get the direction of prices correct (except when they don't). But out towards a year I don't believe their crystal ball is much better than anyone else's.
We really need a better way to evaluate market predictions besides some binary "right" or "wrong" with regard to the up or down direction of price trends. I have more nuanced questions about the accuracy and uncertainty associated with futures market predictions. I still harbor some hope that there is something useful to learn from studying the hive mind that is the futures market. I just don't know yet what it is.
I've been following NYMEX crude futures at the Energy Futures databrowser so that I could get a better handle on the accuracy and precision of prices predicted by futures contracts.
As far as I can tell, traders, taken in aggregate, typically react to news of the past days and weeks more than fundamentals and really don't have a clue as to what will happen beyond just a few months.
As a case in point here is the Crude Oil futures chain from February 06, 2010:
On that particular date the futures chain showed a gradual increase in prices, rising to around $75/bbl for January of 2011. Today's prices are 20% higher than predicted.
What is perhaps more interesting is that the band of futures chains for the three months leading up to February 06, 2010 does a pretty good job of bounding actual prices.
So, although I think traders don't have a clue about long term futures on any particular day, I think their behavior over a couple of months with all of the news-driven emotional highs and lows does a decent job of setting some bounds on the range of possible prices.
Based on eighteen months of data I would guess that the 3-month futures chain band captures actual prices with perhaps a 50% confidence interval. (With more historical data and a more careful statistical analysis we could come up with a more precise number.)
The next several months will be an excellent test of this hypothesis. The current 3-month band says that prices are unlikely to cross $100/bbl in the next year. This could well be true if $100 oil causes further economic downshifting in OECD nations. There will be some ceiling on oil prices as long as there are still inefficiencies to be wrung out.
Happy Futures!
Jon
Financial Forecast Center have maid crude oil price forecast:
Jan 2011:90.1 USD/bbl
Feb 2011:92.6 USD/bbl
Mar 2011:94.3 USD/bbl
Apr 2011:97.3 USD/bbl
May 2011:100.2 USD/bbl
Jun 2011:103.3 USD/bbl
Jul 2011:106.3 USD/bbl
http://www.forecasts.org/oil.htm
Checking the futures chain in October the price never goes above 90.00 out to 2013. It does not seem like a very good predictor of future price to me.
However, if someone was to chance across the spot prices for global grades of oil,
http://www.upstreamonline.com/marketdata/markets_crude.htm
They would realise that the US is spoilt, with Brent blend trading at over $8 premium on WTI, two grades over
$100 and Tapis at $104, $13 premium to WTI. Not much more than a decade ago oil was $13.
I have read recently, perhaps in yesterday's Drumbeat, that WTI may actually start to "catch up" with the other blends in the near future. I forget the logic, but there is definitely something different going on that is different than a year or two ago. We can only "speculate" what that reason is.
CO2 May Actually Have Twice the Effect on Temperature Climate Models Predict!
http://planetsave.com/2011/01/14/co2-may-actually-have-twice-the-effect-...
I don't wanna be a doomer, but is it not time to declare Game Over soon?
Since the CO2 level was 1000 ppm about 50 million years ago, and down to 180 ppm only 20,000 years ago, and we are here today, obviously the planet will be fine. Life on earth be fine.
Humans may have to pack up and move. Again. (This isn't the first time that climate has changed out from under the civilization of the day.) Sometime in the future, I predict a real estate boom in Greenland.
So a General Declaration of Game Over is not called for. If you wish to declare Game Over for Happy Motoring by 2030 you have a much better case.
So far, I'm willing to declare Game Over for the ideas that we are all going to get rich designing each other's web pages (meme of the late 1990s) and flipping McMansions into an early and posh retirement (meme of the '00s).
Peak conventional oil is suspected but not yet confirmed. All in all, relax and take the time to smell the flowers. Most of the storm and fury will blow itself out before it gets to you. Take reasonable preparations in case it doesn't. If you overanalyze the problem you end up looking foolish like the Y2K crowd. Or worse you end up in some suicidal cult.
"Change your code, or die", they said.
We changed our code.
We did not die.
Nice and concise. PVguy is one of the worst drive-by commenters we see on TOD. I get the feeling everything PhotoVoltaicHuman says is intended to provoke and push hot-buttons.
Actually, that's a pretty good description for the majority of Americans who assume, largely without really thinking about it, that there is no problem with an infinite rate of increase in our consumption of a finite fossil fuel resource base.
A good example of things the make you go, "hmmmm....."
:-)
Spot on!
In an age where the best one liner "sound bite" wins I've been scratching my noodle trying to formulate our predicament in one sentence or less that even the most ecologically illiterate can understand.
For example, I've posted this quote before:
Here is another candidate I've been working on:
Cheers,
Jerry
I collect bumper stickers with good one-liners (but never put them on the car). Some of my favorites:
"At least the war on the environment is going well"
"Daddy, what were trees like?"
"Drill here, Spill now"
"Father God created Mother Earth"
"A Prius Mind in a Hummer World"
And for your bike:
/car (with html brackets)
That's a keeper!
Cheers,
Jerry
"Global Warming is caused by the Sun" :-/
Cheers,
Jerry
One GliderGuider found,
Jay Hanson had a good one about EROEI, something along the lines of:
Speaking of which, I just found out about this website:
http://www.jayhanson.us/
Via this paper posted to peakoil.com:
http://www.jayhanson.us/_Economics/Trainer_DeGrowth_14_11_10.pdf
Apparently even steady state, as politically and economically difficult as that would be, still wouldn't be enough to save us from our current Wile E. Coyote moment.
Cheers,
Jerry
Cheers,
Jerry
Maybe there should be whole TOD post dedicated to such one liners, kind of like we did with "graphs, no words" recently...
Just to buck the trend, i always liked:
"Bread and water can so easily become tea and toast."
Ghung - The only sticker I ever bought: SUPPORT MENTAL HEALTH. OR I'LL KILL YOU. Maybe we can try: SUPPORT PEAK OIL. OR IT WILL KILL YOU.
Yeah...a little weak but in my defense I've been up a couple of days on this well. Best I can do until I can get some more coffee. LOL
Ha! It's OK Rock as long as you drill me up lots of propane. Hang in there!
Make sure you have your propane all stocked up , cuz when the New Madrid fault line cuts loose and snaps the Natural Gas 20 inch welded pipe that travels up the Mississippi - there will suddenly be a lack of cooking and heating gas up in your neck of the woods.
My favorite is still "Where Are We Going, and Why Am I In This Handbasket?"
Be sure to ask why is it getting warmer?
Or for the irreverent: "God was my copilot, but we crashed in the Andes and I ate him."
and for the even more irreverent: "Science flies us to the moon. Religion flies us into buildings"
+1
I used to have two stickers on the back of my pickup:
"Thank you for not breeding"
"Vasectomy Prevents Abortion"
I took them off a few years ago. These days I try hard to just blend in with the crowd.
Have you personally done any analysis yourself? Or do you just shovel down what people feed you? And what are you talking about wrt Y2K? You have absolutely no clue as to what would have happened if we didn't invest money into the Y2K transition effort. So people looked foolish in that they invested money into Y2K updates, nothing happened, and then they have to listen to scolds like you?
I actually take the time to dive deep into the models. The gray data points are shock model response latencies to increasing fossil fuel usage. This is excess CO2 above the baseline.
http://mobjectivist.blogspot.com/2010/04/fat-tail-in-co2-persistence.html
http://mobjectivist.blogspot.com/2010/05/how-shock-model-analysis-relate...
Who exactly is foolish in regards to over-analysis? Everything that works is due to over-analysis, as under-analysis leads to problems, and you end up doing extra to be on the same side.
"You have absolutely no clue as to what would have happened if we didn't invest money into the Y2K transition effort."
That's the point; modest amounts of money and a respectable number of programmers contained the problem without the end of the world. The doom and gloom did not come to pass. The survivalists up in the hills were astonished when the ATM's still worked.
As is was, so it shall be. The doom-steaders in the hills will be astonished at the lack of doom.
That said, if you live near sea level you might want to relocate uphill in the next 50 years. (If you are retired this is not your problem.) But there is a difference between reasoned response, and panic. People here tend to get a bit worked up over the latest juicy tidbit.
As the good book said, "Don't Panic!"
Or if you prefer Dune, "I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when it has gone past I will turn the inner eye to see its path. Where the fear has gone there will be nothing. Only I will remain."
A longer version of the same thing.
And it helps that my Ph.D was in modeling. I know all too well how a computer can lie to you with the perfect poker face. Perfect logic is useless if there is an error in your base assumptions. And any sufficiently complex model can reproduce past results perfectly, and still be unable to predict the future. It was a depressing dissertation considering how optimistic i was going in.
Don't forget your towel...
From another person who has been paid to dabble in modeling and is a little older and a tad wiser (hey, it paid the bills for a couple of years)...beware anytime layers of SME subjectivity are built into a model, and also when political agendas abound in your team of SMEs and your paymasters...
I worked with plenty of PhDs in the proper fields wrt our studies, and, as an 'outsider' on the teams, I think was one of the few folks who wasn't deluded.
I loved it when decision makers tended to believe things that were not true and discounted things that were true but were not within the 'party line'.
It was a huge amount of money, having to coax COBOL programmers out of retirement, as just a single example. You are now redefining who the Y2K crowd was. Consultants want to prove that they are indispensable and yelled quite loudly that the COBOL code had to be upgraded. Perhaps you were mistaking them for people up in the hills?
At least your thesis didn't make you "foolish". Or did it? That can happen, pick the wrong topic, or spend years and loads of tuition on something with no progress, you can end up looking very foolish.
The Rural Electric Cooperative that I worked at then, along with about 10 others in Arizona and New Mexico had a big problem because of y2k. The company that supplied our business/accounting/customer-service software decided that they couldn't afford to fix their software to be y2k compliant. So they told us they were going to go out of business and we needed to find another supplier. With about 1-1/2 years to go, this wasn't fun to evaluate new suppliers, and then once we'd selected one, get on their waiting list to have all our databases converted. Then the re-training of anybody in the company that used this software, more than 80% of the people. And we weren't the only ones clamoring for a spot on the waiting list. Anyone who thinks this was just a "modest" fix wasn't involved! At least all our SCADA systems were compliant, I wouldn't have enjoyed changing that much hardware in substations and other remote sites we had (>100 covering >10,000 square miles)!
The company that supplied our business/accounting/customer-service software decided that they couldn't afford to fix their software to be y2k compliant.
I was working as a business analyst for an oil company around the time of the Y2K kerfuffle. One of our software suppliers informed us that it would cost too much money to make one of our software packages Y2K compliant, and we would have to buy a more expensive package to make the Y2K transition, with all the conversion costs you cited.
Now, as it happens, some years before I had been senior systems analyst on the project designing this particular software package for a different oil company, which had sold it to this software company. One of the design criteria had been that it should be Y2K compliant - in fact I have never designed a piece of software that wasn't Y2K compliant.
So we told them they were full of sawdust. Eventually after enough of their clients beat up on them, they agreed to make the package Y2K compliant. They said it was easier than they thought. What a surprise!
It's not as if the year 2000 should have come as a total surprise to programmers. "We flipped over the calender page and suddenly we were in a new century! Who saw that coming?!!" It is just that people are lazy - they just don't want to use 4-digit years instead of 2-digit ones, and they don't like to test programs against all likely failure modes. Most likely we'll have the same problem in 2100. They Y2.1K problem.
> Most likely we'll have the same problem in 2100.
Possibly sooner. In 2038, the Unix 'epoch' rolls over - it will be 2**32 seconds from midnight on January 1, 1970. This is actually more of a worry than the Y2K problem, as it's possible, likely even, that old forgotten military device controllers use Unix time.
The cause of the Y2K problem wasn't only laziness. Back in the '60s, a 30 MB disk pack cost half a year's wages for a programmer. Saving a couple of bytes per order or invoice, with 500,000 orders and invoices, could have meant the difference between one pack or two. The 2-digit year practice was beneficial at the time, but it became just a habit.
To those who say Y2K was a non-event: lots of companies replaced their computer systems in the late 90s, pulling spending forward a few years to do so. The slump in spending in 2001-2003 contributed to the recession, which hit IT workers particularly hard. The productivity gains from the new systems' better information processing (can you say workflow?) eased the growth of offshoring, and helped cause the loss of a lot of middle management jobs. So we got the phenomenon of "jobless growth". This process is still going on. Not exactly a non-event.
2038 is 2**31 seconds from 1970. The time_t is a signed quantity, and if you attempt to represent days past the epoch, it becomes a negative number, and the year would appear to be 1901.
http://en.wikipedia.org/wiki/Year_2038_problem
There are some mitigating factors. Desktops and servers are gradually migrating to 64-bit machines which don't have that problem, and these machines tend to be replaced more often. Of more concern are embedded systems which are still 8-bit, and which can be used for decades once installed.
Size-of-data issues live on. Supercomputing, big databases, the data expands to fill the available space, the smaller the encoding, the more data you can fiddle. And at the other end, in embedded land, shrinking the data means that you might be able to cram your program into the next smaller device -- and the first guy in, gets the market jump.
I can remember a government customer in the 90's requiring a promise (for a supercomputer purchase), that the system be 2038 compliant. The salesman had no problem making the promise -he figured he would be long dead by then. Also such machines are obsolete within 5-10 years, so would long before the date be recycled scrap.
I fully agree. Back then most data was in 80character holerith card images, and saving a couple of characters was a BIG deal.
Much of the bad reputation of Fortran, was because programmers back in those days were very much aware of the high cost of a byte of memory, and would commit all sorts of nasty (from a software enginering standpoint) tricks in order to save a few bytes of core.
Set the flag that makes "time_t" 64 bits. Very few of the boxes that predate 64-bit (emulated) arithmetic, and can't be fixed, will still be in working order by 2038.
As to the non-event, yeah, societally it really was a non-event. Nothing much happened on Jan 1, 2000, except that some TEOTWAWKI-bunker types looked foolish. The productivity gains would have come anyhow within a few years, as you said, so not all that much even there. In the end, the succession of ever more grandiose financial bubbles would have looked roughly the same. Maybe the narratives spun for public consumption about their bursting would have differed in minor details, but so what?
Companies spent a great deal of money and brought forward many IT projects prior to Y2K.
But the greatest damage was inflicted by Greenspan, who pumped about $80 billion into the money supply in late December in anticipation of runs on banks with downed systems. The banks systems stayed up (they actually fail quite frequently, so people have a lot of practice fixing them or implementing work arounds and recovering data), but the cash fed into the final phase of the tech bubble which then broke in 2000.
Less hysteria and a more optimistic view based on the reality that IT systems go wrong quite frequently anyway, would have moderated the boom/bust of Y2K.
Most likely we'll have the same problem in 2100.
Naw, when the number of seconds from 1970 overflows 32 bits....that's the next known date problem. The UNIX date problem.
Judgmentalism is lots of fun, but actually laziness wasn't all that important on the whole. The actual code for a calendar module will look about the same either way even if it's in assembly. After all, the real complexity lies in dealing with the irregularities of weeks, months, days, years, and leap years.
They were conserving resources and using them efficiently (hey, does that sound familiar?) in the early days of computing when core memory was expensive (a 131K - not 131M or 131G - machine could cost millions) and actually provided by the digit on some machines; punch cards were heavy and bulky; and the year 2000 was far off. As core memory and offline storage gradually got cheaper, no bright fiery light ever flipped on in the sky to tell people "today is the day to switch to a four-digit year". So they just sort of coasted along and worried about an almost infinite list of other more pressing things, until the problem started to appear on a time-horizon that finally someone actually needed to care about, as being within the practical lifetime of some software or other (does that sound familiar too?)
Since a lot of other human behavior is fairly similar in principle, one could often save on blood-pressure meds by dispensing with the need to condemn every choice that doesn't work out optimally in 20/20 hindsight as immoral or evil ("lazy".) Truly, there was no particular reason for the guys in the early days to try to write software for eternity, not when the equipment it was running on was already going obsolete and becoming unavailable every few years.
And likewise, as I've said before, there's no particular reason for us to attempt here and now to plan out the trajectory of humanity for eternity, as some engineers and scientists, burdened with an offbeat compulsive-planning mentality, seem wont to do. Indeed, it's little more than a way to become mired in useless frustration. Better to set more modest goals and actually accomplish something, than to succumb to complete paralysis-by-analysis with respect to a fundamentally unknowable future. After all, four digits eventually won't be enough for the year either, but, honest, our descendants have got another 8000 years to figure it out and it's far from our most pressing problem.
any recommendations?
Did you happen to read the article linked to on this thread? Notice the comment:
As I've pointed out before, comparing the Earth today with that 50 million years BP is not very useful. That's because of the fact that there is a key difference in the arrangement of continents today, which resulted after the Isthmus of Panama formed around 3.3 million years BP. That produced a dam, blocking the flow of equatorial water from the Atlantic toward the Pacific and has been linked to changes in the THC. The present cycle of Ice Ages began soon after. Thus, I think it's completely unrealistic to draw a comparison between the paleoclimate of 55 Ma and what might result from today's increasing CO2.
With that note, there would certainly be a problem if the temperature did increase as much as described in the quote...
E. Swanson
But, it is certainly within the realm of the possible, that that change in ocean connectivity created the conditions that further reduced the CO2 concentration. I.E. it is quite possible that the temperature follows CO2 more closly than you are implying, and that the ocean-circulation changes worked to cool the climate primarily by slowly removing CO2 from the system.
After reading up on climate change I've learnt one crucial fact on ice ages; you need a polar land mass. Right now, we have Antarctica. It has been there for rougly 20 milion years or so. For the same period we have had regualar ice ages. The Panama gap thing is not strong enough to break the glacial cycles. Yet, such a thing would change climate big time, no doubt about it.
For reference, check out the Snow Ball Earth theory. 600 million years ago, most continents were around the south pole. And we had the deepest freeze ever.
Hope I don't inspire some denial mania, but the solar intensity was lower 50 million years ago, so the higher CO2 would have been balanced soemwhat, i.e. sensitivity would likely have been lower.
Also, keep complexity in mind at all times. A warmer planet isn't simply how it is now, but warmer, but includes lots of discontinuities that might disrupt ecosystems enough that virtually no ecosystem is intact.
You are a bit more sanguine than called for, I think.
The rate of solar luminosity increase is about 1% per 100my, so 50mya it was about a half percent dimmer, maybe worth a 50% change in CO2 concentration. Sensitivty is a different measure, how many degrees C per doubling of CO2 (roughly 3), and wouldn't be affected by the solar changes, they would simply shift the graph. If the world lacks land and sea ice the sensitivity would likely be lower, as the ice albedo feedback is then eliminated.
I don't think this makes any sense. the concentration was 1000, as measured. the issue is how much energy that amount of CO2 would have absorbed. whatever the level of CO2, less energy coming in means less heating, so sensitivity would absolutely have been lower.
albedo also is not sensitivity, but a feedback.
The sensitivity, as usually discussed, includes shortterm feedbacks (primarily water vapor). A change in solar input of even several percent doesn't change sensitivity, it just changes the global temperature as a function of log(CO2). I.E. in a simplistic manner, a plot of global temperature versus log(bas2) of CO2 concentration will be a straightline, whose slope is the sensitivity. A change in solar luminosity will shift the line up or down, but not change its slope. (This comes from the basic property of logarithms: multiplication of the input by a factor becomes addition of a constant to the output.)
The effect of CO2 as "climate sensitivity" would seem to apply in today's situation. That is, the value(s) which have been tossed about include the effects of the main feedbacks (as given in the latest IPCC report), including water vapor and the ice albedo feedback. It's been said that the climate sensitivity is a log function, thus each doubling in CO2 is expected to produce the same incremental increase in global temperature, which you point to in your comment.
As I understand it, the effects of melting permafrost and thus the release of methane from clathrates is not included. It's quite likely that the real increment in temperature produced as a result of mankind's CO2 release may turn out to be greater than calculated. One reason for concern is the speed of the increase in CO2, which is happening much faster than that seen in earlier epochs. Methane has a relatively short lifetime in the atmosphere compared to CO2, so in the earlier examples where CO2 increases occurred over thousands of years, the resulting methane emissions did not produce as large a spike in atmospheric concentration as may result from our rapid addition of CO2. Thus, I think the situation 50 Ma is not particularly applicable to the present...
E. Swanson
The conclusion, after asking readers of a climate site to download a program in their PC and that way getting data from many different computers, was 3-4 degrees C rise before year 2100.
You think it's only fuel and food seeing price increases?
Interplastic announces price increase
http://www.reinforcedplastics.com/view/15170/interplastic-announces-pric...
OK, that is a small price increase, but for products that are used in oh so many things. Think of how many toy's, medical instruments, etc. are made up of these petroleum based compounds.
Like ion exchange resins... used to "clean up" water for very low conductivity. Very low conductivity is very important in power generation using steam. Another uptick in your electric bill....
The water used to drive a steam cycle is deionized to reduce corrosion and scaling. That water is contained within the closed loop of the system and (usually) not released back to the environment. As a result, the quantity of water required over a period of time tends to be rather small. I think you have presented a null problem...
E. Swanson
I would be a daunting, but interesting task to list all the end products that require the items in the article. I know someone has done this type of thing in the last 10 years (National Geographic comes to mind with all household objects containing petroleum products).
Really? That closed loop water is continually deionized and stored in "clean" tanks. Losing demins while on a running power plant unit means higher conductivity. The cleanup system can only be bypassed for so long until you reach too high conductivity on certain points, economizer inlet and hotwell, and you must shut down. New water introduced is a fairly small amount, though, as you said.
There is another way of making distilled water.....distilling. Make it into steam.
Take the steam side out of the turbine, heat normal water as part of the cooldown and use the condensate of normal water as your new water.
Those are called evaporators and they are old tech.. nobody uses them anymore. They were used until reverse osmosis came about because they can start your makeup water off at a lower conductivity but the demineralizers are still used to keep the clean water clean. An economizer inlet lo range conductivity of .004 uMHO takes some doing to maintain. It is "perfect water".
I think you are missing the point. Conductivity is a proxy for mineral content. The idea is to reduce the amount of dissolved minerals, which would be left behind in the boiler when the water is converted to steam or which would cause corrosion. My WAG is that it's probably not necessary to de-ionize the water that's fed into the boiler every time it circulates around the loop, but the de-ionizers operate as a separate loop running at a lower flow rate...
E. Swanson
The point of the initial comment was the price of resins would rise as oil came up. We try to run 100% of total flow through the demineralizers AT ALL TIMES. You may be able to run just some of flow if you're operating some little tiny process steam boiler, but nothing substantial. I don't see what point I've missed.
Of course the resins are regenerated during the backwash cycle and reused until they break down. I don't recall having frequent replacements of ion exchange resins, and even so, I doubt it's a serious cost issue.
For the same pressure boiler, the degree of deionization required is related to whether cogeneration is being used, such as in a paper mill or refinery where the low pressure steam is used as process steam and a significant amount of condensate lost. Utility boilers are higher pressure than process boilers, enjoying the higher thermodynamic efficiency and avoiding the return of possibly contaminated condensate and a high percentage of make-up water.
However, to the point about higher cost of oil products, this will have a definite negative feedback trough the economy and the multipiler effect is large.
Yesterday there was some discussion about WTI and stockpiles at Cushing, OK.
According to Genscape, which follows oil movements at Cushing, OK, U.S. crude oil inventories at the key Cushing, Oklahoma crude oil hub fell by 719,072 barrels to 39.73 million barrels in the week to Jan. 11, said on Thursday.
To survey oil movements in and out of Cushing, Genscape uses visible and infra-red monitoring to measure stockpiles as of Tuesday, while EIA measures them as of the preceding Friday.
In addition, there were three Midwest refiners experiencing operating problems Friday: CVR Energy Inc announced its Coffeyville, Kansas, refinery will not return to full operations until Jan. 22 after a fire in late December brought units down. Plus there were recent problems at Valero's 90,000 barrel-per-day (bpd) refinery in Ardmore, Oklahoma and Gary-Williams Co's 70,000 bpd refinery in Wynnewood, Oklahoma.
Still the situation at Cushing is leading energy analysts, and even OPEC members, to say that the US oil market is "comfortable" and even "well-supplied". Meanwhile net US oil + product imports in recent months are running behind the comparable year ago amounts - a problem that seems all but ignored outside of these forums.
The trend line is pretty clear. Basically, an increase of about one days supply of crude for the US, in Cushing, since late 2008 appears to have contributed to the Brent/WTI differential:
I wonder how relevant a supply build at Cushing is to overall US crude oil inventories. Are there any pipelines that transport crude from Cushing to the Gulf Coast?
As a point of information to others, capacity at Cushing was expanded very rapidly in 2007, and continued to expand in 2008 and 2009. Its capacity is now estimated to be around 50 million barrels.
I am not aware of any direct line from Cushing to the Coast, but one is planned.
http://www.1310news.com/news/world/article/110830--contract-with-bp-shou...
Enbridge has contributed to the glut of oil at Cushing by reversing a line that used to carry Texas oil north to the Midwest and using it to carry Canadian oil south to Cushing. It has expanded its Spearhead line to carry up to 190,000 bpd to Cushing. However, as they say, the system is "hopelessly bottlenecked at Cushing"
TransCanada Corp is going to contribute to the glut at Cushing in the next few months by starting up its new Keystone Cushing extension to carry oil from Alberta to Cushing. This line could initially carry up to 340,000 bpd.
In addition to the planned Enbridge extension from Cushing to the Gulf Coast, TransCanada is proposing to build a Keystone Gulf Coast Expansion to take oil to Gulf Coast refineries. However, these are still in the planning stages. The earliest startup date would be in 2013.
The Enbridge system can currently move about 2 million bpd to the US, The TransCanada system will be able to move about 1 million bpd when fully developed.
I read about that one myself. To be honest I don't quite get it the problem is there is no way to flow that much oil out of Cushing to any refinery heck you would have to resort to rail cars. Sure they have these lines reversed but all thats going to happen is they will fill up storage at Cushing and flow will have to stop. Its years before they can ever actually flow the pipeline at capacity.
ARCO had a 20 inch pipeline for the Texas coast that was bought by TEPPCO I believe in 2000.
http://www.referenceforbusiness.com/history2/75/TEPPCO-Partners-L-P.html
2000: TEPPCO acquires Arco Pipe Line Co.
The perhaps acquired by EPCO ?
http://www.allbusiness.com/transportation/pipeline-transportation-oil-ga...
I think somehow Magellan is involved also.
http://findarticles.com/p/articles/mi_qn4182/is_20100713/ai_n54491257/
In any case I think this pipeline might have been reversed.
A mention of a reversal of some pipeline I don't know which one here.
http://google.brand.edgar-online.com/EFX_dll/EDGARpro.dll?FetchFilingHtm...
Although I don't have all the links I believe underneath all the horse trading its the same pipeline and it has indeed been reversed.
So there is a 20 inch pipeline looking around this seems to imply a flow rate of about 225,00 bpd. One has to imagine its been reversed.
Found this also:
http://www.oxy.com/Our_Businesses/midstream_marketing/Pages/CenturionPip...
Clearly the system is probably still bottle necked but I'm sure there is a maze of pipelines with several now reversed that eventually gets crude from Cushing to the gulf coast. Obviously since they are still reversing others it seems that the bottle necking is not going to result in a pipeline not running or they would not do it.
What flows in eventually of course has to flow out therefore the outflow equals the inflow. Certainly canadian pipelines might not be running at full capacity but one would expect at least 80% or they would not be reversing them.
I'd guess the bottle necking is not so much one of ability to send the crude out to refineries i.e outflow is sufficient the problem is getting everything routed because it convoluted. This means a good bit of crude gets stored at cushing waiting for allocation.
Obviously it works after a fashion or they would not have done it but I think its clear that its problematic and expanded storage at cushing was a must as routing issues can make flows interment out of cushing.
With all this said any draw down at Cushing could perhaps be of interest if its persists no matter how slow as the way the system works now actually drawing it down is hard to do.
Whats really funny of course is Cushing is actually starting to act like a real vital transhipment point for a significant quantity of oil yet the expanded storage is depressing prices ?
Instead perhaps even the most minor drawdowns might well be more important than most realize as they are in a sense effectively impossible.
Well, here's the big picture:
The problem is that the original purpose of the pipeline system is to take Texas oil to refineries in the Midwest and Northeast, which is why the distribution hub is in Cushing, Oklahoma.
However Texas oil production is declining so there's less Texas oil flowing North East into Cushing:
While imports from Canada are rising, so Canadian oil is starting to flow South East into Cushing. (The map doesn't show these pipelines to Cushing because they are too new or have been reversed.)
In addition, the US imports most of its oil, so there is still a need to move oil North from the Gulf Coast ports to Cushing. They can't reverse these pipelines take Canadian oil South because they are still needed to take imports from other countries North to the Cushing hub.
Now, while TransCanada and Enbridge have recently built or reversed pipelines (not shown) to get Canadian oil into Cushing, there is insufficient capacity to take oil out of Cushing to Gulf Coast refineries.
Half the oil refining capacity in the US is on the Gulf Coast, so this is a big, big problem, and one which cannot be resolved except by building big, big pipelines. Certainly there are smaller pipelines moving oil in that direction, but they are not nearly big enough to ease the congestion at Cushing.
This is the problem with having your distribution hub in a landlocked location. If it was a port city they could just run the tankers in whichever direction they needed to go.
This is basically why Brent oil is becoming the world oil benchmark rather than WTI - it can go wherever the market demand is, not just where the pipelines go.
Obvious questions here. If there is an excess of oil flowing toward Cushing, why are any imports still being shipped to Cushing where it can not be used? As you note, why not simply move the oil by tanker to other refining locations, such as the East Coast or Europe? Is it that the northern refineries can't use the Canadian crude, as mentioned in other posts? Wouldn't the solution be to modify the northern refineries to accept Canadian crude?
E. Swanson
The problem is that a lot of US refineries are landlocked, so that you can't just move oil to them by tanker. It has to come down a pipeline from a port, and where would that port be? Portland, Maine or the Louisiana Offshore Oil Port (LOOP) are not really convenient to many of them, and there may be no pipeline connecting them to any port.
The new Canadian oil coming down the pipe is a lot heavier than many of the refineries are built to handle. The system was set up to move West Texas Intermediate and similar light oils to refineries in the Midwest. The Midwest refineries want to stay in business, they still need the oil, and the pipelines still run to them from Cushing. If they want to do something different, they need to build new pipelines, and/or do some major upgrades to the refinery front end, and that's expensive.
Nobody wants to build a new refinery. It's just too expensive and they can't get government permits anyway. There hasn't been a new oil refinery built in the US in the last 30 years. However, if you were to say to the US government that it should shut down all the Midwest refineries and import all their fuel from Europe, I think the Midwestern Congressmen would have a lot to say about it.
You have made my point, mol. The choice appears to be that between building more pipelines to move crude south or adapt the existing mid-western refineries to the available Canadian crude. Both cost money and take time, so the question is, which costs less? Your comment about there being no building of new refineries, while it may be true (what happened to the one in AZ?), the amount of product supplied has increased over those 30 years, the result of modifications to existing refineries. So, given the options and considering the prospect of declining imports of more expensive foreign oil, which is the least cost option? By that, I mean the cost to the nation, not the cost to the companies which might happen to own a refinery or pipeline...
E. Swanson
I assume this will be a windfall for local OK refineries, if they can use the glut in Cushing to get cheap feedstock and provide refined products back to the Northeast?
I imagine the shortage of refineries will play into the issue as much as overall crude flow. Probably the nation would lack refined products if the OK and TX refineries go slack? This way, perhaps they can at least ship higher-value products through the limited pipeline capacity?
At $10 per barrel, I would think rail cars would be employed at a profit while awaiting new pipelines.
Interesting reading on the Brisbane flooding.
http://www.bom.gov.au/hydro/flood/qld/fld_history/brisbane_history.shtml
The current flooding has so far fallen short of the crest of 1974, and far short of the crests of 1841 and 1893.
http://www.guardian.co.uk/environment/2011/jan/15/australian-floods-quee...
Dip,thanks for the link to the BOM site.The Guardian article,not so much.While Germaine Greer does have some intelligent things to say at times she also comes out with unmitigated garbage at others.This article is no exception however it is just adding to the tripe being aired in the Australian media.
All watercourses flood and the Brisbane River catchment is no exception.What makes this catchment a menace is all the building which has gone on since white settlement on the flood plain particularly in the Brisbane/Ipswich conurbation.
This current flood is not an especially large one.What has made it so costly in loss of life was the catastrophic rain event on the Great Divide in the headwaters of Lockyer Creek,a major tributary of the Brisbane River.
Meanwhile,the clean up,the mourning,the recriminations etc go on.Unless we get another flood in the next few months,which is quite possible,all the kerfuffle will die down and the sheep will continue to graze peacefully on the river flat pastures until the next big one.
We must also consider that dams have been built, before and after 1974.
Corn Prices on a March to $7/bu.
Soybeans could Head to $16
The immediate cause has been the volcanoes disrupting the world weather patterns, but the long range problem is the exhaustion of the Green Revolution relative to population growth. The rise and fall of the Green Revolution is the greatest untold story in economic history.
I wrote a bit about the connection between nitrogen supplies and the Green Revolution about two years ago:
http://www.dailykos.com/story/2009/8/5/762051/-The-Dead-Gods-Of-Atacama
Oh, Neal Rauhauser, here, Stranded Wind, recycling a very old account because I can't recall how to get into the proper one :-(
Good to see you back again, Neal.
Hiya SW.
How's the SW solid-state ammonia project going? I was really looking forward to seeing that technology mature when prices were high. How long before it makes sense cost-wise?
Its been a pretty ordinary year volcanic eruptionwise. We haven't had a big one for quite a while now. Its more a case of climate change leading to unfavorable growing conditions in a lot of places.
The fall of the green revolution is still mainly ahead of us, so it is easy for the technocornucopians to dismiss it as a myth.
The volcano information is here:
http://www.marketoracle.co.uk/Article25460.html
See: Russia and the Roots of World Inflation
yield increase was constant, but as the yield rose the precentabe increase fell. In the US the the
The high percentage gains of the Green Revolution took place at the beginning. The Green Revolution started ca. 1942 at 5% y/y increase and was 1% in recent years.
The lady spreading volcano disinformation thinks global warming is going to be good for us. She didn't actually make the connection between the AO and volcano ash in her last blog post like this article contends for her. The AO is very similar to last winter (before the 2010 volcanoes).
Volcanos erupt all the time around the Earth. The ash from a volcanic eruption doesn't stay in the atmosphere very long. However, if the volcano is strong enough and has a sulfur rich magma, this can result in a large injection of sulfate into the stratosphere, where it might take a few years to be slowly removed. The sulfate combines with water and forms an aerosol of H2SO4, as in sulfuric acid. A very large eruption, such as Pinatubo, can lower the Earth's temperature a few tenths of a degree for the following year.
I think it's recognized that the effects of eruptions at higher latitudes can be different simply because the zonal area fraction over which the clouds spread is greater. They might produce a stronger local cooling at high latitudes. But, in the event you haven't noticed, it was just announced that last year tied for the warmest year in the record books. That isn't the result of a volcanic eruption and suggests that things might have been even warmer without the eruptions...
E. Swanson
I don't understand the mechanism, but high latitude eruptions are considered to be very inefficient at injecting sulphates into the stratosphere (the main mechanism by which eruptions can cause cooling). It is some sort of matter of the height of the troposhere and/or high altitude wind patterns -but I don't know how it works.
Indeed. Even Borlaug recognized this:
In retrospect, we will probably end up regretting that we ever went down this road.
BP fixes ESPO crude for USWC on Alaska snag: sources << ... Meanwhile, crude in storage in Alaska's Valdez terminal had dwindled to below 20 percent of tank capacity as of early Friday, an oil industry source in Alaska estimated. ... >>
Trans Alaska pipeline shut down for repair work << The Trans Alaska Pipeline System shut early on Saturday so crews could complete repairs that will allow restoration of normal oil shipments. ... The operator of the 1,280-kilometre line, Alyeska Pipeline Service Co., said the shutdown, from 12:07 a.m., was expected to last 36 hours, time for crews to install a 48-metre bypass line around a site where a leak was discovered a week ago.... At the site of the oil leak, crews have recovered about 257 barrels, or 10,800 gallons of crude oil, Alyeska and regulators reported. Crews are able to vacuum up about 2 gallons per minute. The oil has leaked onto a basement floor in a pump building but has not been discovered outside the building, officials said. ... >>
""The oil sands are too costly and too polluting," Mr. Chen said in an interview with the Financial Post at CNOOC's shiny, modern headquarters near the centre of Beijing. "Gas has a brighter future.... Shale gas is much cheaper and cleaner."
:-)
Standard negotiating ploy. Create a wave of negative media reporting, drive down the price of what you want, then buy in cheap.
Actual reading is 180 out of course. Shale gas is more limited and less profitable that expected, and we forgot how hard it is to ship it anywhere, so we need the liquids after all.
Shale gas isn't dry. NGL total volume is about 8 mb/d.
Sorry I don't understand what you are saying here. What does the total amount of current NGLs worldwide have to do with shale gas specifically?
Very funny. The Chinese have drilled one shale gas well, and they're telling us how cheap and clean it is.
Well, they're trying their best, but at current production rates there is about a 400 year supply of the stuff in the ground. Most likely the Chinese will be able to use up the world's supply of natural gas in considerably less than 400 years.
I wonder if Canada would be up for China to bring about 100,000 workers (or more?) into Canada to speed up that oil sand production?
Thank Christ it breaks the law. I know this was a joke but it does scare us working folks...I wouldn't put it past the current powers to see a Ted Stevens type(s) take some cash and propose some aspect of this. We would have to shut down our economy in protest.
That is one aspect of a resource economy. Yes, we can ship out raw logs and bulk ores, (we should be doing the secondary processing here), but with oil still as low as it is we cannot compete with cheap labour + transport costs. I suppose if oil was more expensive we would be shipping the finished product, instead. They can ship out high tech work and even uproot whole industries, but can't ship out the physical landmass, yet. Thank you America for providing our military fence to uphold our laws. When it gets really dire, I would imagine the US already has first dibs as there would be dick all we could do about it.
Cheers. (A thankful Canadian)
This also applies to Africa, etc. Just on a slower timeline.
I never understood why everyone thinks it is going to be so easy for China to exercise their claims on African oil, for example, when their dictator partner has been overthrown (or changes his mind) and the US navy is a phone call away.
But don't thank Christ. He had nothing to do with it.
The thing the Chinese have realized is that any African dictator is as bribe-able as any other. When there is a military coup or revolution, they just have to change the number of the Swiss bank account to deposit the cheques in, and it is business as usual.
However, when the US Navy shows up and stops the cheques flowing, someone may just sneak up in the middle of the night and blow a hole in the side of one of their ships. It will always be unclear just who did it, but it will be clear that they don't like the US.
I wonder if Canada would be up for China to bring about 100,000 workers (or more?) into Canada to speed up that oil sand production?
That's a concept that worked much better when they were building the Canadian Pacific Railway. These days, Chinese oil companies are hiring Canadians as cheap labour.
I'm not really joking about that. One of my nephews worked for a Chinese oil company designing production facilities in West Africa, and they paid him about three times as much money as he could make in Canada. During my consulting days I made a few dollars off the Chinese myself.
If you have the right skills, you can make a lot of money, even from the Chinese. Canadians are cheap labour in the international oil industry, at least compared to the Americans or Brits.
CAUTION: BEAR RAIDS ON OIL SANDS AND URANIUM!
The negative oil sands comments come a week after the Chinese "breakthrough" in nuclear fuel reprecessing. The nuclear news release had no supporting technical information.
Solar Panel Maker Moves Work to China
As I'd posted about prions in the past:
http://www.newscientist.com/article/dn19971-prion-disease-can-spread-thr...
"TRIPPIN IN THE BAKKEN AND THREE FORKS" From Black Blake
http://www.investorvillage.com/smbd.asp?mb=4228&mn=64623&pt=msg&mid=9992991
Correction:
http://www.investorvillage.com/smbd.asp?mb=4288&mn=64623&pt=msg&mid=9992991
Above, posted by Leanan:
That was yesterday on BBC tv-news. They expect about 5 billion tons of crude oil under the sea area North of West Siberia. That's about the amount the world uses in one year, but that eye-opener was not part of the news. It's the kind of oil CERA et al uses to convince the world that oilproduction will stay flat or even rise for decades to come.
From the 2nd article down from the top:
Since everyone seems to have a different perspective on whether its supply & demand or speculation determining oil price, then it should be very easy for OPEC to reference those experts supporting speculation to maintain current supply.
Starting to sound more and more like they have decided it is no longer in their best interest to tap into spare capacity, because in the long run not as much oil can be extracted. Their position is probably, let's stretch out the remaining oil at a steady, long, highly profitable pace.
If that's the case, and OECD countries are already past peak, then that means the supply we currently have is it - live within the amount provided and hope it lasts at this level.
Since November 2009, OPEC exports have not varied very much month to month - at the most 2% from the trend and usually much less. Market prices and 'speculation' have not budged OPEC at all.
This implies that there is an actual physical limitation and/or and intentional effort not to increase exports. Since we can safely assume that OPEC has at least a small (but dwindling) output capacity (mostly in poorer grades), one can then conclude that yes indeed, OPEC wants oil importers to live with the current level of exports.
The problem being is that eventually real physical limitations and/or internal demand (exportland model) catch up with OPEC - and exports fall regardless of intended policy. Apparently we are not quite at that point yet, but the growing premium for high quality oil may also indicate that overall quality of the oil being used worldwide is already slipping.
Interesting read on that Mackay, and I agree. The growing premium for high quality oil is now developing a larger than usual gap between it and the lower grades, which is another indication you may be on to something.
http://fairwhistleblower.ca/files/fair/images/Crude_changes-515px.gif
API and Sulfur Content input into refineries
These graphs are clearer if you use annual data:
The take-away message is clear, however. The quality of oil production is steadily declining. This is not a US problem, it is a global one - US refineries import most of their oil from other countries.
In other words, we have used up most of the world's high-quality oil, and are now working on using up the low-quality oil.
This may also be a clue as to why there is more oil being stored longer in places like Cushing. They can't get the refiners that can handle the low quality crude to take it off their hands faster than they get it put in to storage.
So, it "looks" like the inventories are high according to Cushing, but the quality and energy content are much lower than they used to be.
Does anyone have access to the oil grade quality of crude currently at Cushing are history of what has been delivered to Cushing?
Got this link in a Toyota email on Friday. I am not trying to endorse Toyota (although my wife and I have been happy with them for years...even during the whole "brake problem" period), but nice to see some more variety in fuel-efficient car manufacturing. I know these vehicles are not the solution (electric mass transit would be better), but it is improvement.
http://www.toyota.com/upcoming-vehicles/prius-family/?srchid=K610_p37232...
(Shows 3rd Gen Prius, Prius V (more like a small wagon), a sporty concept Prius, Prius plugin)
Things are speeding up in this department.
This is the reason why I plan to hang on to my current car until it dies. It's also the reason you can't draw any conclusions by observing people still driving SUVs. When oil prices are high enough and the alternatives are there, the transition away from them will be made.
Mark my words, there will be some really nice, really efficient vehicles arriving in the next 5-10 years.
Those who think we should all be riding bikes and trains and subways will be disappointed.
Mind you I don't think any of this makes a difference, but still, it's good knowing that we won't need to give up cars just yet.
yup. think I;ll go cut down that last tree now.
I'm looking at purchasing the plug-in Toyota. Probably not version 1.0, though.
However I think there is a good chance Toyota will go bankrupt when car sales plummet after the cascading stock market failure occurs, when oil is down to 70 million barrels per day and it's mostly the military and other essential services that get it.
Those who think we will be driving a significant number of those really efficient vehicles will be disappointed when they can't get credit and the car companies file for bankruptcy protection (again) emerging the other side selling 1/5 the cars they used to (and only if they get a bailout).
My wife still has a 1st gen Prius purchased in 2003 with over 150,000 miles on it. She is looking to get a new one soon and she wants a plugin. I've tried to convince her against it since we live in the Midwest and have absolutely zero supporting infrastructre for it outside our garage. She rebutes that since it is a gas/electric plugin, she can just switch to gas if the battery goes out. I am one to not jump on the new stuff until it has been out a few years, but she is a bold-headed Lithuanian.
If we end up getting one, I'll post reviews.
I would much prefer that our Amtrak line going from my town to Kansas City start running at least 4 lines a day.
I certainly would trust the version 1.0 of the Prius plug-in more than the version 1.0 of the Chevy Volt. It's really the same vehicle they've been selling but with a bigger battery, a modified charging system and some modified software.
This is a whole new game for GM and though it appears they have put in a solid effort I would still wait for version 2.0 or maybe even 3.0. They are just at the beginning of their learning curve while Toyota has been at it for a decade already.
It's not a coincidence that Peter Wells is consulting to Toyota and Toyota started work on hybrids before anyone else. Click to enlarge.
However, the above was predicated on Iraq coming online in a big way:
Hmm...now that I've written it out, waiting for the 2.0 plug-in Prius may not make as much sense as I first thought. It really is the same car just with a bigger battery.
Military+other essentials use how much, about 25 mbd ? When the economy crashes oildemand could go well below 70 mbd. However this doesn't rule out the possibility that Toyota can go bankrupt.
Any significant drop in sales will tremendously challenge the world's largest corporations, especially those with high debt. I don't know Toyota's debt position. Perhaps if they are scenario planning now they could be ready to cut their variable costs quickly (i.e. shut down 80% of their plants) before they suffer from a massive cash crunch.
However, many, many corporations will get caught and will fail. Their failure will send the world's supply chains into turmoil.
I believe it's important to view what is about to happen more as "switch"-like behavior rather than a linear decline i.e. we will see a rapid simplification of the world economy.
Who will be left standing?
When you consider that the current global financial model is based on infinate growth, as in the debt will always be paid in the future by growth generated in the present.
We must be fast approaching the point when some sort of financial "big switch" is pulled to wipe out unpayable debt to prevent total financial collapse.
How would that play out?
"How would that play out?"
Probably with inflation followed by higher rates of inflation. Note that with enough inflation it is easy to pay off all loans.
The Zimbabwe option, I had considered that, it would also assume that institutions/bankers etc, would offload currency by buying up commodities first.
the recent rises in inflation appear to show that the process may have already started.
Note also in the U.S. during recent weeks the expectations of future inflation have increased. The easiest way to show this is by comparing yields of TIPs (Treasury Inflation Protected securities) to ordinary government bonds.
Increasing prices for oil, gold, other metals, grains, and soybeans also reflect an increasingly inflationary psychology. The last time I looked at the M2 money supply, it had increased abruptly. I think we have dodged the bullet on the threat of deflationary depression. But the cost of this dodging is probably going to be a surprise and substantial increase in inflation--followed by much higher inflation rates.
I expect the U.S. dollar to go the way the Mexican peso has over the past sixty years.
A friend of mine is buying a couple of Zimbabwe bills for us from somebody peddling them as collectors items;a hundred million dollar (iirc) note is five bucks, including shipping and handling.
I'm going to frame mine as a conservation piece and educational tool for the kids around the neighborhood -most of them simply cannot get their heads around the idea that a twelve ounce Coke cost only a nickel when I was a kid.
I spent a month working in Sao Paulo during sky rocketing inflation. Had the weeks expenses paid, in local currency, on the Monday. Converted it straight away into dollars. Through the week the dollars were converted back into local currency. The gain in local currency due to the rate of change of conversion rates caused by inflation covered the bar bill.
NAOM
I would be interested in your and aangel's analysis of the impact of worldwide inflation (as opposed to the local types experienced to date). It seems to me that what is going to happen will impact all economies; inflation will go wild in more than just a single major nation, ala Germany post WW I.
Or do you think it will just be the US?
I have a problem with means to get inflation going for just a single Euro nation, like the PIIGS. They do not have their own currency; the Euro is anchored by Germany, France, Norway, etc.. I think complexity there is about to cause chaos / collapse.
Craig
I think it is likely that there will be a global inflation--but some currencies may be exempt from the inflation. For example, it would not surprise me if the Swiss franc retains most of its value as the dollar and euro lose most of their value. Central bankers know how to stop inflation, and if a country's central bank refuses to allow inflation, then it won't happen.
What I think will happen in the U.S. is that the Federal Reserve System will gradually yield to political pressures to do ever more quantitative easing to finance ever-increasing federal deficits. If federal deficits decrease, then the pressure to inflate will also decrease. I'm betting that federal deficits will increase due to decreasing tax revenue brought on by deep recession caused by falling imports of oil and oil products to the U.S. Other major countries (who do import oil) will face similar pressures for the central bank to increase bond purchases to finance growing deficits.
I am on board with that, Don. What I am shaky on is the mechanism for monetization by Euro Nations (Greece, Spain, etc.) since they do not have their own currency any more. Have they given away the ability to monetize debt? And, if the Euro is watered down, what of Germany, Norway and the others? I am watching for some sign that the PIIGS will monetize, and believe that in order to do so they will have to be cut loose from the Euro. Meanwhile, aren't they a continuing major liability to the others? And to world economic stability?
Craig
After reading Ayres-Warr's papers and 2009 book, plus studying the implications of various production functions (inputs of labor, capital, energy and economic output) there is no other conclusion than an economic contraction due to rising oil prices. The Western world is already experiencing financial collapse, the system being held together by insolvent governments.
The energy, food and materials scarcity depression has begun. Unemployment will constantly increase and wealth will be confiscated by money printing.
The rise of a new commodity currency has begun. People, myself included, are using exchange traded funds to park cash rather than buying money market funds. There will be bear raids by the financial system and governments to discourage speculators, but in the not so long run, cash is trash.
I was looking at Ford hybrids. They sell quite a few. But they don't lease any. I wonder why.
I think the key to get through the coming gasoline shortages better than average is to be able to drive without using any gasoline at all.
The Volt is a good idea, in my view, but too expensive still to hit the sweet spot of the market. This is doubly true since the sweet spot will continue to decrease as the world gets poorer. GM claims 40 miles but I doubt that. Probably 75% of that if you want your battery to last any appreciable amount of time.
Toyota is claiming 13 miles for their plug-in hybrid Prius. Again, lop off 25% of that you and may get 10 miles of pure electric driving. Enough to get groceries if you happen not to live within walking or biking distance from a food store.
With one of these two vehicles, you mostly will be able to drive by the cars waiting in line for their ration. If you have to travel longer distances of course you will have to wait in line like everyone else.
The Nissan Leaf is also a possibility if you don't think you'll ever need to drive very far in one go.
Edit: I forgot to add my usual "if you want your battery to last any appreciable amount of time" to specify why I say we'll get only 75% of the manufacturer's claimed distance in extended use.
This guy should post on the Oil Drum !! The part "which other country now accepts the myth that good red-blooded Americans will never stand for such a tax? That is the real art." being easily verified here, even with people perfectly aware of the underlying issue ...
Some of you old timers might recall my adventures with renewable ammonia back in 2007 and 2008.
http://www.theoildrum.com/node/5396
I pretty much gave up on analytical work - it's obvious we'll get no results until we clean house on Congress, so that's what I've been working on the last two years.
I'd like to point out the policy news operation I built, and mention that we're raiding the Drumbeat to populate portions of Energy, Environment, and Transport.
http://progressivecongressnews.org
If you just want energy, environment, transport, this is where to look
http://twitter.com/CPCEnergy
http://twitter.com/CPCEnvironment
http://twitter.com/CPCTransport
It's a rinky dink looking thing, but we seem to be in line to pick up a large grant from the Knight Foundation this summer.
http://www.dailykos.com/story/2010/12/4/925397/-Help-Progressive-Congress-Get-A-$400,000-Grant
Anyway, so I'm back here for a bit, looking for good information & maybe some hands to help with Transportation. Is Alan Drake around?? I've looked the last two days, not seeing his comments.
Iowa Boy,
I received a 'Server not Found' several times for your progressivecongressnews.org link
I did find this:
http://thedailyinfluence.netvibesbusiness.com/cpc-master
Alan announced (I think in December) that he was going to be an infrequent poster on TOD, as he was moving on to the next phase(s) of his quest.
Whoops.
http://progressivecongressnews.org is a dead end, while http://www.progressivecongressnews.org is alive and well. I'll fix that here in a minute ...
Unfortunately he only posts very occasionally now. However the contact info in his profile http://www.theoildrum.com/user/AlanfromBigEasy is valid and if you email he can explain a bit more why he no longer participates on TOD much these days.
Neal, Glad to have you back in the neighborhood. We (as in: the US) are going to need more guys like you if the price of oil keeps climbing. A while back, I did a Google search and it looks as if some of your fellow Iowans have continued working on your Stranded Wind concept..
E. Swanson
Best wishes finding Alan. I miss seeing his posts as he was one of just a few who understood the potential of rail mass transit. I hope he responds and his input is part of the mix. He has a good grip on reality.
Craig
Cept when he was saying that other cites should be trashed to save 3 others because they were "special".
If the rising water is gonna put your city underwater, its gonna go underwater and there is no reason to dump energy into trying to fight Nature.
I think you're seriously misrepresenting his point, Eric.
Part of it, as I recall, was simply to say the NOLA has both cultural and economic value to the country, and both in very good measure. Yet If he WAS promoting the conscious desertification of Las Vegas, would you really fault him for that?
Another angle on that argument is of course to point out that every house in this country is pouring energy into 'fighting nature'.. but people pick on NOLA because it's just easier to see their particular Energy Investment. At that point, it becomes important to measure the EROEI and see just 'How Much' our various inputs compare with their corresponding outputs.
was simply to say the NOLA has both cultural and economic value to the country
Culture can move. And the economic value of someplace underwater is? (Hint: the economic value can also move. "Economic Value" does that quite often. Look at Evergreen solar - they just packed up and moved and the stock went from sell to hold)
every house in this country is pouring energy into 'fighting nature'
Really? "Every House"?
There are Earth Sheltered homes in Minnesota which are unable to drop below 45 degrees all winter.
Are you five, Eric?
You've heard me post for years now. You know what I'm talking about.. or is argument for its own sake that gratifying for you?
Besides, do those Earthships have any artificial light? That's also pumping in energy to thwart nature.. not saying it's 'Bad'.. but it should be recognized and kept in perspective. In Every House.
Considering there are stories of people freezing to death in their homes after having utilities shut off - not every home.
Other are living in tents - and many call them home.
What'll be "interesting" to see is the effect on the present housing stock when the natural gas lines stop carrying their product up north to the buildings built with actual 2x4's back in the late 19th and early 20th century.
Eric;
It seems necessary to detail to you that my saying 'Every House' refers to the point that we pour tons of energy into our overall lifestyle, and the way we do that needs to be exposed and explored. It wasn't all that oblique.
The fact that you go off onto side-issues doesn't sideline me or my points.. it ultimately sidelines you, and our ability to build a useful discussion and not just another 'Oh-yeah?..' festival of shocked indignation.
It's easy to get distracted.. can be hard to stay on topic. You're a smart guy, but easily distracted into unnecessary or just unrelated arguments.
Stay Sharp..
That's his MO. The inaccurate ad hominem.
I don't know why the editors give him so much leeway. These should be in violation of the Comment Guidelines, even if they weren't made up.
I've frequently appreciated when Eric and others have been relentless bulldogs on certain issues, but as above, it clearly can turn into a 'Mania of Debunking'..
.. and such posters get to doing little beyond picking at any misstatements or simply deriding a comment that is 'possible' to misinterpret, instead of trying to understand what another poster is working to say..
My axiom so I don't get lost in this has been to remember to look for 'What's right with this picture?', instead of the more familiar "What's WRONG with this picture?" You can find mistakes in anything, but with the maze we're in now, we need to start assembling whatever works, even if imperfectly. (IE, EV's) Not just sledehammering the flawed.
I have responded often to the pleas to rebuild NOLA - frankly expressing my opinion that it is really dumb to rebuild below sea level when sea level is going up! I don't recall Alan being particularly emphatic about that, or wanting to trash other cities in order to save NOLA. But maybe I just don't remember correctly.
Notwithstanding, Alan is well grounded in mass transit, and understands the problems, pitfalls, and both the equipment, land and fuel sides to RR travel. His input on mass transit has been well received, as were his thoughts during the BP disaster! Many people have sound ideas, well grounded in science and logic, and are totally out to lunch in others. JMG comes to mind... he has a good grasp on what will happen in certain circumstances, and is level headed. OTOH, he IS "Archdruid"... not a really good place to position ones self when trying to make serious points on very important issues.
So. I consider what a person is saying, what facts they rely upon (and double check those facts), the clarity of their arguments (whether they are valid, and whether they are sound), and make judgments accordingly. If they have taken a weird position may have some effect, but mostly on how throughly I cross check facts and logic.
I do agree with you about NOLA! Not about Alan.
Craig
I do agree with you about NOLA! Not about Alan.
If you don't remember Alan making the NOLA rebuilding comments - then yes, you'd agree with the original poster that he hit his themes outta the park every time.
But on the idea of 'government must work to save city X' where X contained NOLA - that is a poor plan.
Alan's train plan is sound. And to implement the plan - spending time here pointing it out won't be as effective as going out into "the real world" and interfacing with the elected officials who can move large piles of money about and take land for rails.
JMG comes to mind... he has a good grasp on what will happen in certain circumstances, and is level headed. OTOH, he IS "Archdruid"... not a really good place to position ones self
And you can find people who place his ideas as part of the "Grand Masonic Plan" to make slaves of us all due to low energy because he's a Mason.
Don't know if you will be revisiting this chain. It is interesting that you comment on elected officials moving piles of money and taking land, given the history of rail transit in the US. Of course, this is something that I have been active with for a while. Unfortunately the local officials are a bit out of touch. I remarked once to the head of the DART systems that their soon to open Plano end-point station would require way more parking and far more cars than I saw available. His reply: "People here don't use mass transit anyway... we have more than we need." Today you cannot find a parking place within 1/4 mile of the station, the rush hour trains are SRO, and they still operate on 20 min intervals, but only during rush hours... otherwise 45 minutes (a long time to wait in the open, since most stations do not include shelter of any type) plus, and they stop running about 12:30 am. Sounds okay until the day you're have to work late, and about 1:00 pm it's "call a friend" since the trains won't help.
The problem is worse with airport travel. One never knows when one's late flight will wind up delivering one to Love Field too late to take transit home. And, for that reason NO ONE takes public transit to the airport in Dallas. Don't build it and they won't come! Sort of a field of nightmares scenario.
It is a shame that the Interstate system is replete with grades too severe and turns too extreme to be used for rail. OTOH, using mostly interstate ROW, and blending with new ROW to modify the extremes would make much sense.
Craig
The link up top The third Industrial Revolution got my technucopian brain going about distributed power generation and storage:
My curiosity led to this article:
...about the "Bloom Box" fuel cell. I didn't realize they were this far along. They now refer to them as "Energy Servers". One of my off-grid technodreams is to produce and store hydrogen with PV to be used in a fuel cell system, solving my intermittency/battery problem, so I try to stay up on these things. To this point, fuel cells have been one of those "always 10 years in the future" things, like fusion. The current price tag of $800k (for a 100kw unit) is a bit beyond my budget, though one can always hope.
Some key claims from the Bloom Energy site:
I find #4 particularly interesting. If these things have the ability to hydrolize water and store the hydrogen they would be perfect partners with intermittent sources such as PV and Wind. Total cycle efficiency and cost will be limiting factors, IMO, though there may come a time when folks wonder what life was like without fuel cells, to paraphrase the end of the LA Times article.
It's a natgas fed fuel cell. The technology is reversible, what they're selling most certainly is not. They may have some advance in catalyst materials here, but that is all.
It's pretty darned hard to catch wind or solar and turn it into something usable. The best storage schemes I've seen are pumped hydro/wind, there are schemes to compress air in underground storage for later generation, and for solar it seems less an issue since production is concurrent with air conditioning use.
Now if we could just catch all that loose wind in the plains states and produce easy to store easy to transport ammonia ...
But don't get me started on that.
"It's a natgas fed fuel cell. The technology is reversible, what they're selling most certainly is not. They may have some advance in catalyst materials here, but that is all."
It seems to me that the catalyst is the key. The rest (reversability, tweaking of fuels, etc.) are fairly routine engineering problems.
They have a pretty serious list of customers ......
http://www.bloomenergy.com/customers/
As for producing something usable:
Seems doable to me if the market exists.
I'm certainly open to any valid debunkery of the claims made on their site and elsewhere, so show us what you've got.
BTW, I worked quite a bit with large scale ammonia refrigeration plants. Sorry if it's not my favorite stuff to work with. Post some links and I'll look at what you have. Always open and interested!
natgas fed fuel cell. The technology is reversible,
A reversible fuel cell that you can input electricity, water and Carbon and get out Natural gas?
Do tell...
Iowa Boy,
I will pull the string: Do you have a web site featuring your concepts? Have you guest-posted here on TOD previously?
H
Based on the comments - yes. I'm guessing he's part of the "convert wind into Ammonia" effort - which claimed a $250 a barrel price for the Ammonia produced that way. Said human was under a few different names - stranded wind being one of them.
Its not a bad plan, I just don't see it being really considered until the delta between ammonia via natural gas and wind becomes 3:1 or so. And, well, "we" seem to be a long way off. The other way it'll never happen is if magical room temp superconductors happen - then the 'stranding' won't be limited by copper.
I believe that was one of the last projects Matt Simmons was pimp'n before his death.
http://ammoniafuelnetwork.org/projects.html
Iowa Boy here? http://ammoniafuelnetwork.org/contact.html
Don't be shy ;-)
Eric (and all)
From the Ammonia Fuels Network web site:
I am not a math major, but methinks that $250/barrel NH3 is not comparable or lower in price to gasoline.
1 barrel = 42 U.S. gallons.
Gasoline in Albuquerque today is almost $3/gallon at the most expensive sales points.
1 barrel of gasoline is ~ $126
If NH3 was ~ $250/barrel then NH3 is ~ twice as expensive as gasoline.
However, the Ammonia Fuels Network site claims that NH3 has ~ 52% of the energy density of gasoline.
Therefore, if the $250/barrel for NH3 assertion was and still is correct, and given that one would need ~2 barrels of NH3 to have the equivalent energy of 1 barrel of gasoline, then one would spend ~ $500 for a barrel of NH3 vice ~ $126 for a barrel of gasoline today.
IF...the $250/barrrel for NH3 figure is correct.
The idea of using NH3 is interesting to think about for the day when oil is very scarce.
Of course, like anything else, the time to do the research and proof-kit engineering is now, not waiting for the day when oil is very scarce.
He used to be Sacred Cow Tipper.
And welcome back SCT!
If there's a chance, I hope you'll have a chance to do a post on your work so far, or at least drop your links now and then to the articles that best show us what you've been finding out.
Bob Fiske
Portland, ME
Has much research been done in the area of large arrays of large, high-speed flywheel energy storage?
I'm going to jump in and say flywheels have great power capacity, but don't store enough energy to be practical for long term storage. They are good for utilities and industries to balance out short term supply/demand flucuations (milliseconds to a few minutes). They are not suited for example for bridging a wind gap, or for storing PV for nighttime use.
Beacon Power has product they can sell you.
Here is the wiki on beacons system:
Beacon Power plans to open an electrical power frequency regulation plant before 2009.[20] Lower carbon emissions, faster response times and ability to buy power at off-peak hours are among some advantages of using flywheels instead of traditional sources of energy for peaking power plants.
So there is in fact some activity in this area. Supposedly cost per unit of storage capacity is lower than batteries, but it is still significant. Round trip energy efficiency is good, and rotating storage can respond at high power levels. I still think it too costly to cover day-night issues (for solar).
Here is the Beacon web site:
http://www.beaconpower.com/
The utility frequency stabilization facility in NY state is under construction:
http://www.beaconpower.com/company/201012-gallery.asp
A list of proposes applications for this technology:
http://www.beaconpower.com/solutions/other-flywheel-applications.asp
Cost likely a big issue for larger-scale uses. One can imagine /much/ higher electricity rates, but then, all things being equal, demand would fall significantly, and where would the money come from to build and maintain this infrastructure?
Energy density - 2kw and 500 watt in/out, you have to place 'em in a buried concrete "bunker" and no idea how well they do in earthquakes are also factors.
(all from memory BTW ... may not effect current conditions)
Just for general interest
One of the regular contributors at Renewable Energy World has a blog on Energy Storage
Energy Storage Trends Blog
Drilling off Angola: The Will to Drill in NY Times Sunday Magazine.
References the infamous USGS global reserves study, and Richard Sears' TED presentation designed to avoid ruffling their feathers:
Hmm, I think I can.
This comment starts well then slides away
Another opportunity lost, but some motion in the right direction and a good read.
There is something that is inherently risky about staking your energy and economic future on the weather. Farmers have known this since the dawn of civilization.
Wind and solar energy production may be dramatically affected by climate change. When the north and south Polar Regions heat up and all the polar ice melts, then the thermal differences between the polar and temperate zones will become more equalized and the ocean currents will decline. The winds that now equalize these regional temperatures will becalm and the skies more cloudy.
Wouldn’t it be a kick in the butt if the world installed 10,000,000 wind mills and the winds stop blowing?
Read more….
http://www.sciencedaily.com/releases/2009/06/090625202010.htm
Around here, winds tend to be associated with frontal passages and storms. When the area is under a high pressure cell, the low altitude wind speeds drop considerably. However, under those conditions, there tend to be few clouds, thus, solar powered devices would enjoy greater output. The use of both types of generation tied to storage would provide a more or less continuously available electricity supply. The key is linking the two sources and the addition of adequate storage capacity.
BTW, no scientist I know of has claimed that the sea-ice would disappear completely year round. I think it's safe to say that it will still be cold enough to freeze portions of the Arctic Ocean, since there won't be any more sunlight there on 21 December than there is in today's world. The problem is that the new sea-ice formed in Winter may completely melt during the summer months and thus the thicker multi-year sea-ice won't be found...
E. Swanson
Well, I am not climate scientist but winter time ice extent is in a downward spiral, too. So at some point you think this graph is going to level out? Based on volume data, I expect it to accelerate and be completely ice-free by 2030.
Here is a research paper from a climate scientist on how we get to a year-around ice-free arctic.
Nonlinear threshold behavior during the loss of Arctic sea ice
Personally, I find the paper above a little intimidating. This one is a little easier for me to understand.
The future of ice sheets and sea ice: Between reversible retreat and unstoppable loss
Thanks for the reference from the PNAS. I will read it carefully and check the references. However, I already disagree with the premise, because the basic idea is flat out wrong. The third paragraph states:
First off,, because of it's high latitude, the albedo of the water in the Arctic Ocean will not absorb most of the incident solar radiation. That's because the direct beam of the sunlight arrives with a low elevation (high zenith) angle and the surface albedo under those conditions can be as high as 0.20 to 0.30. Secondly, during the summer, when the sun is highest, the snow on the surface of the sea-ice, as well as the ice, begins to melt and form ponds. As a result, the albedo of the sea-ice is reduced to as low as 0.40. Thus, the notion that there is a large difference in albedo over the Arctic Ocean is flat out wrong. References available upon request.
A picture is worth 1000 words. This one is from the SHEBA Project.
Notice how dark the ocean and the sea-ice are compared to the image of the sun on the water. The camera lens has been stopped down, darkening the scene. Lots of reflection from that water and the sea-ice is rather dark...
E. Swanson
That water in melt ponds is awfully flat. By contrast, the ice-free oceans will have waves which will have less albedo due to reflection. There will also be more frequent and stronger storms. Etc...
Anyway, you may be proven right about existence of Arctic ice in the winter and I would think the question will be answered before long -- this part of the experiment is generating plenty of data to analyzed.
Yes, waves do effect the albedo and wind speed tends to increase wave heights. Looking further at your first NAS reference, including going thru the supplemental material, the analyst apparently assumes an albedo of 0.20 for open water and 0.60 for the sea-ice. No melt pond albedo effects are included. No distinction between direct beam solar and diffuse from scattering and clouds or aerosols. No allowance for time of day variations or seasonal effects. With all that expected open water, what about clouds? Again, I would need to read much more carefully before passing judgment on the report, but I wouldn't jump to the conclusion that the Arctic will be ice free year round. And, there's the effects of ocean circulation to consider as well.
That said, I do think it's reasonable that it is highly likely we will see an ice free Arctic Ocean at the end of the melt season. I even tried to bring this out in a comment I submitted on the US CCSP SAP 3.4 report about abrupt climate change back in 2008. They added a graph showing the decline in minimum extent after my complaint, though there's no way to know whether that addition was due to my statement. That's a different animal, as they say...
E. Swanson
Not sure if this has been posted
http://www.calculatedriskblog.com/2011/01/hamilton-historical-oil-shocks...
http://www.econbrowser.com/archives/2011/01/oil_shocks_and_2.html
Also consider:
Kilian, L., 2008, “Exogenous Oil Supply Shocks: How Big Are They and How Much Do They Matter for the U.S. Economy?” Review of Economics and Statistics, 90(2), 216-240
Kilian, L., 2009, “Not All Oil Price Shocks Are Alike: Disentangling Demand and Supply Shocks in the Crude Oil Market,” American Economic Review, 99(3), 1053-1069
their conclusion:
seems to imply that they have identified the cause-effect relationship between price shocks and economic down turns. While they allude to the problem of declining supply, they leave unspoken, aside from another price spike, what would be the economic response to a permanent decline in supply. The mild forward looking prediction is understandable in a history paper.
The take home message for me is an affirmation of the relationship between high energy prices and reduced consumer demand, and the need for industrial retooling of the automobile sector relating to large cars. In an energy constrained future, these would become permanent rather temporary adjustments. The retooling may indeed be occurring, but as always the permanency is dependent up future consumer demand. The current apparent trend for elimination or reduction of fuel subsidies may reinforce the retooling.
Snowmobiles and XC Skiers have a fairly new trail companion..
http://www.pressherald.com/life/outdoors/fat-fun_2011-01-16.html
The Will to Drill
You sort of wonder where you get these guys. I mean, this is someone who should know.
Peak Oil will happen at the very closest/earliest in 30 years as 'realistic'? Anything other than that is 'hard to describe' as in hard to predict?
Is he ignorant? Is he paid and did he sell his soul?
Christ. Are we doomed?
L - He isn't stupid per se. He's an exploration geophysicist. They're paid to be optimistic. I tease westexas about being a typical exploration delusionist. But to play the exploration game you have to have unbriddled enthusiasm otherwise you just sit at your desk all day and repeat: "This ain't going to work...this ain't going to work."
The stupid party IMHO was whoever decided to let a geophysicist give a speech about future oil production.
But to play the exploration game you have to have unbriddled enthusiasm otherwise you just sit at your desk all day and repeat: "This ain't going to work...this ain't going to work."
Yes, it's a tough job. They either had to be on anti-depressants or keep a bottle of whiskey in their desk drawer to get them through the day. The ones who were bipolar did okay for a while, but eventually they went into their depressive phase and had to be hospitalized. I knew one who was permanently manic, but eventually management noticed he was spending a lot of money and wasn't finding any oil, and he became permanently unemployed.
We used to have a picture posted on the bulletin board of one of our former exploration geologists that had appeared in the local paper under the heading, "The Fate of the Homeless". There he was, pushing his shopping cart from dumpster to dumpster, collecting bottles so he could buy his daily ration of booze.
We viewed it as a motivational message, though. Keep your pension plan topped up, keep your lawyer on speed dial, and buy shares in liquor companies. Whatever works.
Yes we are doomed....we are all doomed to die.
The whole 'demand' argument here is "interesting". Because tied to "demand" is "price" - so is this gent claiming that there will be no shortfall of oil until 'no matter what price you offer, we the oil industry will tell you "nope, don't have it"'? That point may be 50 years off.
Is the guy claiming that world demand would be the same if the oil was at $10 a barrel?
At some point plant oil will be "just as" economical as rock oil - thus "the world" will 'never' be out of oil. But the infrastructure and economic models built on $5 and $10 a barrel oil will be long gone.
Reality is going to look like this:
Demand guy says, I want oil and will pay $100/bbl. Supply guy says, "I don't have enough to supply it to you b/c I have an earlier offer from China for $100. What do you offer?
Reality says: there is not enough to supply both China and Demand at $100. Price has to go up. It goes up until one of the buyers says, "I will take a pass." At that time, the price is set, and someone goes without.
Eventually more and more people will go without. Meanwhile they will bid up the price as long as they think they can make a buck processing it or reselling it.
In medicine they call this triage. The people with the greatest need get treated first. In oil, the people with the most money get the oil. Meanwhile, prices of everything that uses oil, whether as feedstock, lubricants or fuel, goes up. Even if wages don't. Until everyone says, "I will take a pass." Last time that happened was at $147/bbl.
The bottom is determined by what it is costing to recover oil in the lowest cost area, plus commissions and a small profit to the supplier. That way the easy oil is sold first, and next trip down the bottom is higher than the last. This, IMO, is going to get really hairy, really soon. At some point, it will probably lock up the economies of the world completely, and then... TSHTF.
Craig
Yuppers - and the reality won't be pretty.
But the above doesn't "on its face" disprove the statement made by the Shell dude does it?
Brent $99.20 Intraday
Oil prices spike towards $100 milestone << OIL: London Brent oil surged to $99.20 a barrel late on Friday - touching the highest level since October 1, 2008 >>
Oil surges close to USD 100 per barrel << Brent North Sea crude for delivery in February soared to USD 99.20 in late afternoon deals >>
The First Oil Shock << A research paper by Eyal Dvir of Boston College and Ken Rogoff of Harvard suggests some interesting parallels between the recent behavior of oil prices and what was observed at the very beginning of the industry. >>
Not sure that that the comment by "Hawcreek" is entirely accurate. I'm not an Alyeska guy, but my understanding is that the TAPS reconfiguration was done for two reasons.
First, throughput was decreasing as N Slope production declines. Several pumpstations were mothballed because they were no longer necessary to move the smaller crude volumes. Operating fewer pump stations meant lower transportation costs. Lower transportation costs mean the fields can produce economically at a lower volume, which means they can stay in production longer.
Second, the reconfiguration replaced much aging equipment. Remember, TAPS has been in operation more than 30 years. Stuff wears out and/or becomes obsolete and expensive to maintain.
It is true that the reconfiguration did reduce the ability to cold start the pipeline. The original specs were for a restart after 21 days at -40 F. See Pipeline shut down for weekend to connect bypass for some discussion of this. For a very critical view of Alyseka, see articles by Richard Fineberg. However, without knowing what was planned for reconfiguration at Pump Station 1, it is difficult to say whether or not the current leak would have been prevented.
Current estimate is the bypass will be completed and the pipeline will be restarted late today or early Monday morning. Weather and complexity are causing the work to take longer than the original 36 hour estimate: Alaska pipeline set for late Sunday or Monday open
Fortunately the temporary restart allowed them to empty the storage tanks at Pump 1. This gives a cushion for the fields to maintain minimal production and prevent freeze damage to production facilities.
Two energy related articles from this newspaper today(Sunday)
More wind power: Wigton Phase Two opens
Revisiting Jamaica's energy crisis
Ahhhh! So now we know where the minister is getting his forecasts from. It is interesting that he makes some claims about the stability of future NG supplies and prices that, do not take into consideration the same concerns he has about coal and oil. That is, what happens to the supply/demand/price situation when, the "capacity additions" he heralds, take place in the US(and other places).
I would be surprised that he is not a bigger fan of renewables were it not for speculation that, he has investments in the arrangements to handle LNG. On the other hand, his counterpart in the opposition, the Opposition Spokesman on Energy and Mining has, according to my sources, been making some investments in the area of solar PV. He has entered the debate by questioning the LNG deal in parliament.
Robertson says LNG report not for public consumption
I will be adding my own 2 cents to the debate, behind the scenes, on Monday.
Alan from the islands
A month or so ago, I predicted that OPEC will do almost nothing about increasing exports until oil gets to about $120. We have confirmation now that at least Iran agrees with that:
http://www.businessweek.com/news/2011-01-16/iran-says-no-need-for-opec-t...
I also still expect that the 'tipping point', or the oil price level which pushes US economic growth back into negative territory is also about the $110 to $120 level.
However the fact that the US may tip into recession at $110 to $120 does not necessarily mean that the price of oil will stop going up at about the $120 level, although it probably will at first. While I do not see a price 'superspike' coming any time in the next few months (barring a new Mideast war), at some point in the not too distant future I do expect the price of oil to go well beyond whatever 'tipping point' may actually exist.
It could oscillate around a price point until the whole thing comes crashing down. The price will drop as there will temporarily be oversupply since the economy will have contracted so quickly.
Like how a population can approach its carrying capacity in a stable way. Except in this case we don't actually stay at that level for very long. We rapidly reset to a lower level and the process begins anew. The graph c) below demonstrates what I'm saying.
So I could draw an e) in which oscillation occurs for a while followed by collapse to a lower level, as in d).
Good point. Also I am making an assumption that the price will rise gradually, as it has been over the last year. A slower price rise would appear to have a more muted impact on economic activity. The 'boiling frog' effect may also be at work here - a very gradual rise in prices may make people more comfortable with higher prices, resulting in less immediate change in transportation for work and personal activities.
The possibility for prices higher than $120 exists because even as US demand might fall after that, demand from other countries may increase faster than the fall in US demand. The US has already taken a significant hit in demand since 2008; the next step down in demand may be less sensitive to price.
My theory is that max prices were "tested" back when they spiked up to $140+ to see what immediate effects this would have on global economies. Once the test was finished, price was allowed to collapse. Now, TPTB know what the magic prices are that have what effect on various economies and they are trying to find the sweet spot...higher prices with some GDP growth.
This is just my crazy theory and based on TPTB having a lot of power to play with crude prices, but this is what if feels like to me.
Price still has a lot to do with quantity demanded of oil products in the U.S. over time. In the short-run price elasticity of demand is very modest, just a few percent. Over a few years, however, price elasticity of demand increases greatly (Actually, it decreases greatly, because it is a negative number. But let us use absolute value and ignore the minus sign.).
Just as the U.S. reduced its quantity demanded of oil and oil products in the nineteen seventies, we can expect a similar response in the 2000 teens. Over time, it will not be hard for Americans to reduce their consumption of oil and oil products by 10% and even 20%. The crunch will come later, when oil imports go down by more than 20%; then I expect rationing of and price controls on gasoline and probably diesel and jet fuel too.
I'm not sure...I think memmel is on to something. A lot of the fat has already been squeezed out in this past round. I'd give you at most a 10% saving with little loss in economic activity but not 20%.
And oil imports going down by 10% is a monstrous decline.
13 mb/d x 0.1 = 1.3 mb/d
That's 1.3 mb/d / 20 mb/d = 6.5% or 62% greater than the constriction in 1973
There is so much discretionary driving in the U.S. that I think we can adapt to a 20% decline in driving personal vehicles without big disruptions. Diesel is another matter: We are so dependant on trucks that a 20% decline in diesel supplies would have to be accompanied by a decline in real GDP of roughly 20%. But note that during the Great Depression real GDP fell by much more than 20%, and except for a brief holiday of bank closings, the socioeconomicpolitical system remained intact. I do expect real GDP to decline substantially and also U3 unemployment rates to go well above 20%.
This is decline--not collapse. Collapse will come later, when oil imports are down to fifty or sixty percent of current levels. Note that on the graph you are fond of posting, the next step down is not very great. The one after next is the big one.
Sure, but I wasn't making the case for how large of a decline was going to cause collapse. I was simply challenging your 20% assertion.
However if you want to talk collapse, I don't think a financial collapse equals societal collapse. I agree: that comes later.
I think Orlov's stages are quite a good model. The big step down in my graph is financial collapse.
Stage 1: Financial collapse. Faith in "business as usual" is lost. The future is no longer assumed to resemble the past in any way that allows risk to be assessed and financial assets to be guaranteed. Financial institutions become insolvent; savings are wiped out, and access to capital is lost.
Stage 2: Commercial collapse. Faith that "the market shall provide" is lost. Money is devalued and/or becomes scarce, commodities are hoarded, import and retail chains break down, and widespread shortages of survival necessities become the norm.
Stage 3: Political collapse. Faith that "the government will take care of you" is lost. As official attempts to mitigate widespread loss of access to commercial sources of survival necessities fail to make a difference, the political establishment loses legitimacy and relevance.
Stage 4: Social collapse. Faith that "your people will take care of you" is lost, as local social institutions, be they charities or other groups that rush in to fill the power vacuum run out of resources or fail through internal conflict.
Stage 5: Cultural collapse. Faith in the goodness of humanity is lost. People lose their capacity for "kindness, generosity, consideration, affection, honesty, hospitality, compassion, charity" (Turnbull, The Mountain People). Families disband and compete as individuals for scarce resources. The new motto becomes "May you die today so that I die tomorrow" (Solzhenitsyn, The Gulag Archipelago). There may even be some cannibalism.
http://cluborlov.blogspot.com/2008/02/five-stages-of-collapse.html
Don I think what your missing is what I would call bifurcation. The wealthier people are unlikely to cut down on their driving i.e oil prices are very unlikely to go high to cut driving that much. And they also have significant flexibility in other expenses. The fat or waste is not only in using oil products but all kinds of other areas. In general I label this group as one that tends to buy a car that gets twice the fuel economy and drive it twice as much. And of course if they do get serious about conservation the additional economic activity associated with providing more fuel efficient goods and services helps offset any initial gains.
Next we have the people who are maxed out and have allocated all their income regardless of income level given falling home values this group will default on debt.
Below this we have people with little flexibility and perhaps not a lot of debt. They will default on what they can and perhaps cut some driving but are likely to cut other expenses. Don't forget that they have and investment in a car and its generally for this group the status symbol and differentiates them from those that cannot afford a car. Once you get past house the car is the center of wealth. More likely than not you will get and increase in the number of cars that are shared in one form or another. Before you get excited about this in general the usage pattern is the driver drops off someone and or picks them up then goes somewhere else often back home. The distance traveled increases. I call it the taxi effect.
As oil gets more expensive and the economy cools people shift down this pyramid however the net difference in oil usage is small the real gains happen only when someone is reduced to riding the Bus/Biking/Walking. This is really and infrastructure issue. All the way down as expenses exceed income debt default allows you to increase cash flow as I've said.
Now I do think you get a very real and fairly large short term drop in oil usage when you have a period of concentrated layoffs. During the first few weeks or months that someones out of work their oil usage falls like a rock then rises. In general they start working in the cash economy when they can. This moves quite a few people down to the bottom rapidly but as I've said its only right at the start of a new round of layoffs. As time progresses those laid off for more than a month increase their oil usage. So its a fairly finite effect and overtime there is a very significant rebound as most are generally capable of finding work that allows operation of a car indeed most jobs require it. The number that actually end up at the bus/bike level is small.
I'd argue that prices required to really trim the fat would cause enough defaults to collapse the economic system. There is really no route to real contraction as it requires a significant number to give up their cars. Thus as I've written several times I don't expect significant changes until after housing prices have collapsed.
The wealthier people are unlikely to cut down on their driving i.e oil prices are very unlikely to go high to cut driving that much.
And at some point the poor won't care about their money going to support the roads the wealthy drive on.
What then?
I am hearing a lot of adaptation talk, from a lot of people I never expected to be in that mode. Consider the typical third world, or developing nation. They get by on so much less. Then, think of what is the absolute minimum needed to 'survive.' We have discretionary food, discretionary driving, discretionary travel, discretionary telephones, televisions, entertainment, clothing, ... and discretionary children. The real problem would be if, after cutting down to those basic needs (basic food, shelter, minimal heat/cooling, travel to work and back - if we are lucky enough to have a job - we still do not have sufficient income or things to barter to survive. And, if the planet has a carrying capacity of 1.0 to 2.5 Billion, we are way into overshoot. And, we have destroyed so many parts of the ecology and damaged so many more that when the crash happens, we might fall from 7 Billion to a few tens of millions. Or to zero? My guess would be to 100,000,000 or so, and a very slow recovery from there. After the collapse.
I do take exception to your statement:
I think that the big one could be the next one, the one after, or the one after that. It will happen when people are rioting worldwide, including in the capitols of the US, Britain, Germany, Japan and China. I have no idea how, or if, calm will be restored. Perhaps the nations taking over production from the Corporations, and redoing the triage based on human need instead of human greed? And, there will probably not be sufficient oil and gas left to prevent the drawdown of population, though there is a chance that it could be made a bit easier. I am glad I won't be around for that part. Or maybe that is just a hope.
I go from thinking that the complexity of society will prevent uncontrolled collapse (manic) to certainty that it will be the cause (depressive). Unfortunately, all those psychoactive drugs rely on petroleum as a feedstock.
Craig
Yes, he has learned how to get his posts deleted.
The new TOD is working very effectively, the mods know spew when they see it.
You really are very unpleasant at times. If you don't like memmel's posts then why not reply constructively or just ignore them - even flag them if you really feel that strongly. I'm far more fed up reading your aggressive attacks than I am scanning memmel.
Ditto.
Agree with him or not, I've NEVER seen Memmel be mean.
Let's be honest, but decent to each other.
Bob
"Careful, Each of these boys has a Mutha.." Riddler(?), 'The Batman Movie'
US, Israeli Computer Program Slows Iran's Nuclear Ambitions
Who would've guessed?
Climate Change the Real Cause of Roman Empire’s Fall (i.e. We’re Next)
As reported in New Scientist, by analyzing almost 9,000 ring samples from a variety of tree species, Buntgen was able to reconstruct a record of important climactic details like annual rainfall and average temperatures, and to connect these patterns with an era of mass migration and social unrest, one that ultimately ended in the dissolution of one of history’s largest dynasties.
So what does all this mean for the American Empire? Well, since modern humans are soooo much better adapted to dominating their environment than those dumb ancients—particularly in terms of things like procuring food and mitigating the effects of pesky forces majeure like drought, fire, and flooding—experts believe, probably very little. In other words: keep fiddling.
Engineers decry campus energy consumption
Energy costs decline from 2009 to 2010 but experts say more could be done to better use currently wasted resources
See: http://mainecampus.com/2011/01/12/engineers-decry-campus-energy-consumpt...
There's just no excuse for this. Clearly we can do better.
Cheers,
Paul
It's the norm, though. A typical campus has few who can do the analysis and make changes, and they're usually 110% committed on "urgent" support issues. Sure, you could hire contractors, but there is no budget for that this year. Yes, you'd get payback in a year, but who pays until then? Finance is buried figuring out funding for the new football stadium.
Businesses have the same issue, with the added excuse that saving money on such things isn't a "core focus". During good times, paying the bills is easy. During hard times, there is no money or manpower to investigate savings.
It's hard to envision an incentive scheme that would break the logjam. Really you want organization to invest in efficiency monitoring and improvement, and if you could bootstrap and then re-invest it would self-perpetuate (most large orgs have a long list of wasteful processes). If they run out of projects, then you're already succeeded anyway.
I often think about making a business out of this (as obviously you have), but I struggle with how to be successful in the current climate.
There's a lot of truth in what you say. I mentioned a couple of weeks ago that we hit a similar brick wall with a university in New Brunswick and finally gave up because it became increasingly obvious that the situation wouldn't change. Boy would I love to box a few ears !
Cheers,
Paul
Rep. Giffords and the New Energy Economics and Security Consensus
The article "EV costs in CA outweigh gas prices" seems to be missing the obvious.
Did they bother to consider the E-9 rate with Time-of-Use metering created specifically for EV owners? No? Duh.
http://www.pge.com/myhome/environment/pge/electricvehicles/index.shtml
Of course, you can always throw solar panels up on your roof too. Because if you are paying the at high-tier rate then the payback for solar panels is pretty quick.
"price stability". ha
SoCal Edison kindly slashed the peak rate and upped the off-peak rate a couple of years ago. Part of my decision to install PV in 2001 was to take advantage of those earler rates. After the change the off peak rate is actually higher than the first tier in the normal tiered structure. The silver lining was that it was a bit of a hassle to have my water heater on a timer and always be harping on the wife and kids about light switches...much easier to go with the flow...let the pumps in my 20,000 gallon water storage pit run in the afternoon, leave the water heater on, run the AC without thinking too hard. etc.... I threw in the towel and got rid of TOU 2 years ago.
Why the U.S. nuclear industry’s ambitions are at risk of going up in smoke
See: http://www.theglobeandmail.com/report-on-business/industry-news/energy-a...
Well, if nuclear power in Canada is not dead, it's smelling pretty bad.
Cheers,
Paul
Whenever I talk to a nuclear advocate, the main counter-argument that I bring up are the staggering costs of the things. Not just the construction costs, but the potential liability in an accident potentially has no upper limit so there would be no insurance company in their right mind that would insure against an accident. As a result, governments would either need to insure the things directly, or impose liability limits of some sorts.
That's been a major stumbling point for me as well, and I'd rather see that same money spent on reducing/managing load. Perhaps unfairly, but I view nuclear power as a continuation of "business as usual", whereas I believe we need to radically rethink how and why we use electricity.
Cheers,
Paul
Excerpted From the Will To Drill, NYTimes Magazine 16 Jan 2011
"There is an element of uncertainty in every complicated engineering endeavor. “In July 2003, in the Pacific, a Japanese fishing boat was sunk by a flying cow,” Robert Bea told me. Bea is a professor of civil and environmental engineering at the University of California, Berkeley, and a leading scholar of risk; he also spent many years working in research and management at Shell. The cow, it turned out, was part of an illegal cattle shipment bound from Anchorage to Russia; as the plane approached its destination the smugglers became nervous about their cargo and began shoving it out of the plane. “No risk analysis can ever be complete. No one can predict a flying cow.” "
End excerpt.
Risk analysis is difficult, but I'm pretty sure we can rule out flying cows. See http://www.snopes.com/critters/farce/cowtao.asp
Professor Bea, reporter BENJAMIN WALLACE-WELLS and some editor at the NYTimes are a bit gullible.
http://www.nytimes.com/2011/01/17/us/17governors.html
As seen from the end of that paragraph, the shortfall is estimated to rise from 26 in 2010 to 82 billion in 2011. Also, a quarter million foreclosures were transferred to 2011 due to a moratorium via bad paperwork in 2010. Yet, 2010 had over a million foreclosures, a record, but 2011 may even set a higher record.
I'm not even sure we need to argue whether or not peak oil in the form of higher priced oil (net energy decline) is impacting our lives or not, it's clear it is in many ways. With 37 governors, of which 26 are new, dead set on not raising taxes, but instead drastically reducing state budgets, the net result will be less complexity. We are moving down the civilization ladder from high complexity to meeting more basic needs. Just like when we bring in less money from our job/s we reduce our outlay to the basics at the personal level, it's occuring now on the state and local level. Soon, it will be occurring at the Fed level also.
Don't get me wrong. I'm not against the painful state and fed cuts that will be needed to balance budgets, I just think it's important to point out it's due imho to higher priced energy, in particular, higher priced oil with its embedded costs in most products and services.
AUSTERITY is the new buzz word that conveys the fact we are post peak, living through the reduction in societal complexity, and from globalization to localization.
Now someone could argue we are not post peak, because we are still on an undulating plateau of oil production. However, at what price? I would argue that the moment of 'peak oil' was actually at the greatest flow of oil per capita for the lowest price per barrel, and that was 2005.
That was last week but…
This last Friday January 14 2010, there was a successful demonstration of a 10 kilowatt nickel hydrogen cold fusion reactor in Italy and peer reviewed papers to follow this upcoming week.
http://nextbigfuture.com/2011/01/multi-kilowatt-nickel-hydrogen-cold.html
Saturday January 15th Sergio Focardi and Andrea Rossi called a press conference online about the presentation of the 10 kilowatt module reactor: with 100 of such modules is made the 1 MW plant in construction.
A process (international patent publication N. WO 2009/125444 A1) capable of producing large amounts of energy by a Low energy nuclear fusion process between nickel and hydrogen, occurring below 1000 K, was described.
From the original (italian) Patent as follows:
Apparently, there is zinc as well as copper transmuted contaminants inside the nickel powder after the reaction. This zinc was not present at startup: probably Ni+2H->Zn
There are other traces of transmuted contamination elements in the used nickel fuel from the prototype reactor, like Sulfur, Calcium Chlorine, Potassium. Apparently this could be an indication of some low energy neutron fission process happening together with the Low energy Neutron Reaction (LENR) fusion.
Most importantly, commercialization of this technology will begin immediately and will ramp to full production during the next three years.
I've posted that, IMO, most people are too distracted to worry about Peak Oil or Climate Change. Case in point:
http://www.youtube.com/watch?v=OWtDpGM36J8
Maybe she was texting the latest IPCC report to a friend :-/