Category Archives: Domestic Energy

OPEC Strategy Report Says Two More Years Of A Crude Oil Glut


frackingimagesOPEC meets 5 June in Geneva to discuss the cartel’s strategy for the coming years.  Reuters News Agency has obtained the draft report of OPEC’s long-term strategy. This report’s content will be a key discussion at the meeting. The report suggests that the global oil glut could persist for the next two years.   In general that seems like pretty good news for the world and specifically for U.S. if not for the OPEC cartel and Russia.

The drop in oil prices that began late last year did not shut down the fracking wells that were already producing as the wells continued to operate to cover their variable costs. It did cause drill rigs to be cut every week for 23 weeks. Reuters reports that only one rig was cut the week of 18 May.   Experts seem to agree that fracking can be profitable at a West Texas Intermediate (WTI) price around $60/barrel. That price level should bring on more fracking operations. Today’s price is $59.89. (changes often.)

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Taking One-third Of U.S. Coal-fired Power Plants Off The Grid By 2020 Simply Isn’t Workable


Obamaringingthebell109478_600Warner Baxter is chairman, president and CEO of St. Louis-based Ameren Corp, the largest energy provider in Missouri, serving more than 1.2 million electric and gas customers.  He says that” taking one-third of U.S. coal-fired power plants off the grid by 2020 simply isn’t workable”. He laid out the reasons for this belief  using a posting on the Wall Street Journal.com titled “The Dirty Secret of Obama’s Carbon Plan”. This posting is behind a paywall, so you may not be able to access it.

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DiCaprio, The Green Hypocrite


Well, no American MainStream Media source will ever call any Hollywood Green a hypocrite. So, if you happen to be curious about Leonardo DiCaprio’s green credentials you have to go off-shore, to say England, where the DailyMail.com provides a picture of how Mr. DiCaprio conducts his off-screen life. The UK blog posted this “Leonardo DiCaprio the ‘eco warrior’ flew on a private jet from NY to LA SIX times in SIX weeks, Sony hack documents reveal”. The storyline is:

“He’s a high profile advocate of environmental causes, believes the world must act now to combat the effects of global climate change and is producing documentaries about endangered species.

But accusations of hypocrisy have also dogged Hollywood star Leonardo DiCaprio, 40, with detractors accusing him of not practicing what he preaches.

RadarOnline said that several documents relating to Sony corporate travel records show the Titanic and Wolf Of Wall Street star took six private roundtrip private jet flights during April and May 2014.

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Secretary Kerry Earns 4 Pinocchios From Fact Checker


Several days ago, David Middleton’s takedown of Secretary of State John Kerry’s speech to the Atlantic Council was posted on this site. There are so many things out of kilter in Kerry’s speech that this posting will highlight some additional issues.

Earning 4 Pinocchios From The Washington Post Fact Checker

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Jay Leno Wants To Ban Ethanol In Gasoline


Jay Leno says that putting ethanol in gasoline results in fires in older model automobiles.   As many of you know, Leno is a collector of classic jaylenoaw_20150302p10 Leno-Ethanol-1cars, most of which are old cars. In a posting in Autoweek, March 4,2015 titled “Jay Leno hates ethanol” he says:

“There have been a lot of old-car fires lately. I went through the ’70s, the ’80s and most of the ’90s without ever having read much about car fires. Suddenly, they are happening all over the place. Here’s one reason: The ethanol in modern gasoline—about 10 percent in many states—is so corrosive, it eats through either the fuel-pump diaphragm, old rubber fuel lines or a pot metal part, then leaks out on a hot engine … and ka-bloooooie!!!”

 Once in my business career, I was the manager of our methanol-in-gasoline program. The company spent in the high six figures on laboratory work to determine the safety of methanol (not to be confused with ethanol) as a gasoline additive.  The program tested fuel lines, gaskets, fuel tanks, etc. Basically everything that this blend would encounter. The concentration of the methanol in the mix was an important factor. The work was completed and we got EPA approval to use. We knew that some of the older vehicles  owners might need to be alerted about the properties of the mix. At that time there was no Renewable Fuels Standard so people were not going to be forced to use the blend. Not too long after getting the EPA approval, the company decided to go out of the methanol business. End of story.

Jay has several more complaints about ethanol blended in gasoline at 10%:

“There’s more. I find that gasoline, which used to last about a year and a half or two years, is pretty much done after a month or so these days. If I run a car from the teens or ’20s and fill it up with modern fuel, then it sits for more than two months, I often can’t get it to start.     Ethanol will absorb water from ambient air. In a modern vehicle, with a sealed fuel system, ethanol fuel has a harder time picking up water from the air. But in a vintage car, the water content of fuel can rise, causing corrosion and inhibiting combustion.

Leno believes the Renewable Fuel Standard has done more harm than just that of damaging his and other people’s cars.   He says:

“Blame the Renewable Fuel Standard. This government-mandated rule requires certain amounts of ethanol and other biofuels be blended with gasoline and diesel fuel. “I just don’t see the need for ethanol. I understand the theory—these giant agri-business companies can process corn, add the resulting blend to gasoline and we’ll be using and importing less gasoline***. But they say this diversion of the corn supply is negatively affecting food prices, and the ethanol-spiked gas we’re forced to buy is really awful.

The big growers of corn have sold us a bill of goods. Some people are making a lot of money because of ethanol. But as they divert production from food to fuel, food prices inevitably will rise. Now, if you don’t mind paying $10 for a tortilla…”

He would like some action here:

“It’s time for us as automobile enthusiasts to dig in our heels and start writing to our congressmen and senators about the Renewable Fuel Standard, or we’ll be forced to use even more ethanol. Most people assume, “Oh, that’ll never happen. They’ll never do that.” Remember prohibition? In 1920, all the saloons were closed. It took until 1933 before legal liquor came back.”

At most marinas, gasoline containing no ethanol is supplied as small craft engines can be destroyed by the ethanol-gasoline mix. So boaters might want to join Leno and the automobile enthusiasts.

Leno has more to say about this issue and you can read it by clicking here on this website:

http://autoweek.com/article/car-life/jay-leno-hates-ethanol

***Actually I believe he means “importing less crude oil” rather than “gasoline” but it doesn’t alter his point of view. These days we have plenty of domestic crude oil so we don’t really need the ethanol to stretch our gasoline supplies.

cbdakota

 

 

 

 

 

 

 

Potential Shutdowns Of Fracking Wells Looms–But Not Caused By Low OPEC Prices


Some of the Texas and North Dakota fracking oil wells were thought to not be profitable at the low crude oil prices that Saudi Arabia had engineered. But most of them have weathered the storm.   Drilling has slowed down however. World wide, except for the Middle East, rig count is down.

shale gas plays

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Peak Oil Not A Near-Term Threat


Peak Oil is that point in time when the world runs out of new finds of oil and from that point on,  oil becomes more scarce and more costly. The Department of Energy’s Energy Information Agency (EIA) forecast that in the year 2040 about 81% of our energy needs will be satisfied by fossil fuels. The following  data is from the  2014 EIA Annual Energy Outlook for U.S. energy consumption in 2040:

Quadrillion Btu % of total
Petroleum 35.35 33.25
Natural Gas 32.32 30.40
Coal 18.75 17.70
       Fossil fuel subtotal 81.45
Renewables 10.27 9.94
Nuclear 8.49 8.00

The Pacific Research Institute produced this video that reports we are not about to arrive at Peak Oil any time soon.  Which is a good thing as  the EIA does not expect renewables to be a significant contributor to our energy needs by 2040.

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cbdakota

Why Haven’t We All Starved To Death?


All engineers and scientist should be skeptics.  Most engineers are because if they build a bridge or an automobile, or what ever, it better work right away.  Some scientists are making a lot of  predictions about events to come 25, 50 or 100 years into the future.  Well that’s their privilege, but it probably would be well to take a skeptical view on any prediction years into the future.

The Pacific Research Institute has produced several videos that are meant to challenge “appeals to authority’  like all scientist believe in …….

Ehrlich’s solutions were for the government to take charge. Impose taxes, new regulations etc.  Doesn’t that seem very much like what is now underway to  “stop catastrophic global warming” some day out in the distant future. Remember that name,  Paul Ehrlich.  He wrote another book which was just as wrong as the “Population Bomb”.  By the way, this other book was co-authored by John Holdren.  Holdren, in case you don’t remember, is President Obama’s Science Czar. Aren’t we lucky.

cbdakota

 

“Drill Baby Drill”.   Does The President Think We Don’t Remember What He Said?


oil-fuel-of-the-pastPresident Obama has made it nearly impossible to access off-shore and Federal Lands for oil and natural gas development. See here and here. He campaigned in 2012 (He always is campaigning— he is much better at that than governing) saying that “Drill Baby Drill” was an empty slogan which would have no effect on crude oil prices. See the following Fox News report:

Back when gas topped $4 a gallon, Republicans chanted “drill, baby, drill” at rallies across the country — arguing more domestic drilling would increase supplies, reduce dependence on foreign oil and boost the U.S. economy.

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Why Are Crude Oil Prices Falling? And Will We Regret It?


Saudi Arabia is a major producer and seller of crude oil as well as the unelected leader of the Organization of Petroleum Exporting Countries (OPEC). Saudi has, in the past, adjusted its production (and thus sale of crude oil) to keep the price OPECnetoilexportrevs2013chart2at a level that OPEC desired. For example, if global demand for crude softened, Saudi would cut back production to match demand thus stabilizing the price. The Department of Energy chart shows how Saudi dominates OPEC export sales.

This autumn the demand for OPEC crude fell—but, Saudi decided not to balance supply and demand.   Consequently the price of crude oil has dropped to about 50% of what it was at its high in June 2014.

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