Archive for the ‘Oil Production’ Category
By Alan Caruba
Finding, extracting, transporting, and refining crude oil is a very expensive business. It is also a very risky one. There are no guarantees that one will find oil and, finding it, there are no guarantees that the investment and all the assets involved will not be stolen by the governments that invite oil companies to tap their natural resources.
If you want to know why gasoline and everything made from oil is going to cost more in the years ahead, I give you, ladies and gentlemen, Hugo Chavez, dictator of Venezuela, and a number of other nations who have engaged in extortion.
On June 26, Hugo Chavez told the Big Oil companies that had invested in Venezuela’s Orinoco Belt that they were going to have to sell their assets at a ridiculously low price to Petroleos de Venezuela (PDVSA), the state oil company. They were instructed to hand over majority control as part of Chavez’s nationalization program.
In power since 1999, this disciple of Fidel Castro fired 75% of the managers of the state company after they staged a strike in 2003. Only the increased investment by foreign-owed companies kept Venezuela’s oil industry from total implosion. This year he showed his appreciation by forcing out British Petroleum, Chevron, Total, and Norway’s Statoil. ConocoPhilips and Exxon Mobil Corporation have since concluded they too could not continue their operations in Venezuela.
The popular myth about Big Oil is that it wields such great power that nation states cannot resist them. The reality is that, faced with dictators like Chavez, often the only alternative is to leave or cut the best deal they can. The other reality is that Venezuela’s oil production has declined 25% since Chavez, a committed Communist, crushed the strike. With the major oil companies departing, how much greater a decline lies ahead? That is just one reason gasoline will cost more.
By Alan Caruba
An article in the March 19 issue of Business Week magazine caught my eye. “Why Hybrids are Such a Hard Sell” was the topic and reporter David Welch began by writing, “Given all the buzz about hybrids, not to mention the greening of the citizenry, you’d think they would be easy to sell. They’re not.”
The sale of hybrid automobiles constitutes an anemic 1.8% of all vehicle sales, down from a peak of 2.1% in October 2006.
I would suggest that Americans aren’t all that “green” despite the endless print and broadcast media harangues that our wonderful lifestyles are to blame for everything from hurricanes to frizzy hair. Those who have tried to be green have found that there are considerable additional costs involved and this has proven particularly true of hybrid cars that include batteries to permit electricity to partially replace the use of gasoline.
“One major reason is that hybrids typically cost $3,000-plus more than conventional cars,” noted the reporter. “With gas at $2.50 a gallon, it would take ten years to recoup the extra $3,000 cost of the Accord hybrid.” The cost of the batteries account for about half the hybrid premium and “cheaper lithium ion cells won’t appear for several years.”
By Alan Caruba
Hating so-called “fossil fuels”, coal, oil, and natural gas, with a passion, the environmentalists have perpetrated every deception possible and, among them, is the notion that Americans can avoid destroying the Earth if they just fill up the tanks of their automobiles with ethanol.
As I have pointed out in the past, the world is not running out of oil and, here in the United States, we have enough reserves of coal to provide electricity and other needs for centuries to come. So who has the new Democrat majority in Congress declared persona non grata? The oil industry. Their proposed “answer” to our transportation energy needs is ethanol.
Instead of pandering to the environmentalist’s obsession over fossil fuels, Congress should be making areas in and around the United States more accessible to exploration and extraction of known oil and natural gas supplies. That is the true definition of “energy independence.”
This has not occurred because most of America’s onshore energy is in the West and Alaska where more than half the land is under federal control. We are talking about estimates, according to the U.S. Interior Department, of 187 trillion cubic feet of natural gas and 21 billion barrels of oil, representing 76 percent of onshore federal oil and gas resources.
By Alan Caruba
There is an effort in Congress—mostly thanks to the Democrat leadership—to strangle the energy baby in the cradle.
Why they and some addled Republicans would want to do this defies an answer beyond the hatred environmentalists have for all forms of energy other than windmills, solar panels, and crops which should be eaten instead of poured into one’s gas tank.
Let’s start by understanding there are now three hundred million Americans. More people increase the need for more electricity. America currently must generate 15.43 trillion kilowatts of electricity and is in immediate need of more.
Lack of transparency and accountability encourages impunity
WASHINGTON – Higher oil revenues have enabled mismanagement and abuse of power in Venezuela, leading to record levels of corruption, argues a new policy analysis by the Cato Institute. In the study released today, "Corruption, Mismanagement, and Abuse of Power in Hugo Chávez's Venezuela," author Gustavo Coronel, member of the first Board of Directors of Petróleos de Venezuela from 1976 to 1979 and Venezuelan representative to Transparency International from 1996 to 2000, details how the Chávez regime is squandering the country's wealth through rampant official and personal corruption.
Dubbing Chávez's government "hypercorrupt," Coronel identifies four main reasons for the nation's rapid decline to the bottom of global corruption and economic freedom indices. Misused oil income, mediocre management, Chávez's determination to play a "messianic" role in world affairs, and political populism designed to garner the affection of the people rather than promote the creation of new wealth have also contributed to the rise of graft.
By Alan Caruba
In late October I attended a luncheon briefing in New York sponsored by the Middle East Forum. The speaker was R. James Woolsey, former director of the Central Intelligence Agency and currently a vice president at Booz Allen Hamilton. The room was filled with men who represent a class of citizenry known as “influential.” Woolsey’s topic was “Energy Alternatives and the War on Terror.”
Normally, I give men like Woolsey a lot of respect because they’ve earned it. However, it didn’t take long before I began to hear views that made me begin to question, not just the wisdom of what Woolsey was saying, but why he was saying it.
“The way strategically over the long run to weaken the enemies of Israel, such as Ahmadinejad, is to weaken the role of oil,” said Woolsey. “Oil makes it harder to avoid genocide in Darfur because the Sudanese have a deal with China, and it makes it harder to deal with Iran, because China and Iran have an oil deal.”
Say what? Weaken the role of oil? Genocide in Darfur has something to do with China? Iran will not pursue its lunatic Islamic apocalypse because it has an oil deal with China?
A lot of what Woolsey told the attendees is fairly common knowledge. He noted that natural events such as hurricanes can affect the amount of oil available and that terrorism—he called it “malevolent interference”—could provoke a war that would interrupt the flow of oil out of the Middle East.
By Alan Caruba
It’s not very often you will find me agreeing with an avowed environmentalist, but facts are facts and, when it comes to population growth, they are ignored at our peril if America is to avoid sliding rapidly into a Third World status.
“The American people, especially our leaders, must bring themselves to face the reality that our population cannot be allowed to continue to grow without disastrous consequences,” said Donald Mann, president of Negative Population Growth, Inc. in response to the news that on October 17, 2006 our population passed the three hundred million mark.
Of that number, the estimate of illegal immigrants ranges from twelve to twenty million. In his bestselling book, “State of Emergency”, Patrick J. Buchanan noted that “Rarely have immigrants constituted 10 percent of our number,” adding that “We have almost as many foreigners here today as came in the first 350 years of our history…(and) most of those coming are breaking in.” The U.S. Census bureau calculates that an immigrant sets foot in America, legally and illegally, every 31 seconds.
Americans, in addition to the out-of-control immigration crisis, have an even larger crisis looming and it too will impact every aspect of our lives. With more people being born every day than are dying, we are less than thirty years away from a population of 400 million!
We do need a new, replacement, younger work force and the current Social Security and other benefits programs depends on this. It’s predicted to go broke in a decade or so anyway.
A dramatically growing population is going to require more roads, bridges, power plants, airports, housing, jails, schools, hospitals, and other elements of our national infrastructure just to keep pace with our current needs. By any measurement you apply—crime, healthcare, education, transportation—life in America is going to grow worse without the facilities and the energy to maintain our current lifestyles.
The quickest, easiest answer is to stop all immigration, legal and illegal, into the nation and do not tell me this cannot be done. It has already been done. Between 1924 and 1965, America declared a moratorium, a forty-year pause that allowed the “melting pot” to facilitate assimilation into our culture.
Recently, 7-Eleven convenient stores has decided to discontinue selling Citgo gas at their pumps. Citgo is owned and operated by Chavez, the dictator in Venezuela. Instead they will be buying their fuel from American owned company, Valero.
Chavez has being saber rattling giving strong anti-American speeches, including his last one at the UN two weeks ago. He has called President Bush the devil and an alcoholic and has threaten to dispose of our country's heritage. He has nurtured a strong alliance with the terrorist group Hezbollah which operates out Venezuela for over the last ten years.
7-Eleven spokesman Margaret Chabris said that, "Regardless of politics, we sympathize with many Americans' concern over derogatory comments about our country and its leadership recently made by Venezuela's president Hugo Chavez." (Breitbart.com)
And recently, Florida State Rep. Adam Hasner has expressed strongly that he doesn't think CITGO should be selling gasoline on the Florida Turnpike system.
Last month, Susser Holdings Corp of Corpus Christi, Texas, is radically downsizing its 18-year relationship with CITGO. And like 7-Eleven, they will be getting their gas from an American owned Valero.
Republican George Pataki, a potential 2008 presidential candidate, said he has had more than enough with the Venezuelan leader bad mouthing the American commander-in-chief.
"This person has no right coming to our country to criticize our president. He can take his cheap oil and do something for the poor people of Venezuela," said Pataki during an interview with Fox News.
When asked if he would patronize Citgo, the gas company owned by Petroleus de Venezuela, the state-run oil company, Pataki told Fox News, "I have no plans to." (CNSNews.com)
By Alan Caruba
In May 2006 I wrote, “I know about the “Peak Oil” theory that says we either have or are about the reach the point of diminishing returns regarding the world’s oil supply, but these recent discoveries suggest there is still plenty of oil to be found.” In that commentary I documented nearly a dozen new fields of oil and natural gas discovered since 1995.
So I wasn’t surprised when, on September 5, Chevron Corporation announced it had discovered new, huge reserves of oil some five miles below the surface of the Gulf of Mexico. The initial estimates were that these reserves “could boost U.S. oil reserves by 50 percent.”
Good news for Americans and good news as well for other oil companies such as BP, Anadarko Petroleum, and Exxon Mobil that have their own projects in progress. Indeed, two days later, Exxon Mobil announced that its Sakhalin-1 project offshore Russia had begun to export crude oil, the eighth startup within the past year.
Suffice it to say that the new Gulf of Mexico discovery rivals that of Alaska’s giant Prudhoe Bay oil field in 1968. President Bush may think we’re “addicted” to oil and, along with other politicians, call for oil “independency”, but the fact is we, like every other modern nation require oil for transportation, plastics, heating homes, and the countless other uses to which we put petroleum.
Recently, Abdallah Jum’ah, president and CEO of the state-owned Saudi Arabian Oil, better known as Aramco, said the world has the potential of 4.5 trillion barrels in reserves. At current levels of consumption, that’s 140 years worth of oil to power the world. Even at the lowest level of estimated reserves, there’s still enough until 2070 and does anyone believe we will not find more?
A humorous look at our oil problems and the possible soloution to all our gas and oil problems.
by Tom Attea
Recent exploration of sediment deep beneath the Artic Ocean has led geologists to estimate that approximately 1/4 of the world’s untapped oil and gas reserves are located there. After evaluating the impact of the news, the U. S. may seek membership in OPEC.
President Bush, smiling and joking with King Abdullah of Saudi Arabia at a press briefing in Nome, Alaska, stated, “Since it looks like we’ve got about as much oil off Alaska as our good friend the King here has in the Saudi desert, it seems like a pretty good idea for America to consider membership in OPEC. The least you can say is, maybe then we’ll have more influence on prices at the pump.”
King Abdullah, who flew in to tour the newly oil-rich region with President Bush and Vice President Cheney, commented, “Until now, I thought a country had to have a lot of sand to have oil. Now, I see it can also have a lot of snow. If America wants to join OPEC, we will be very happy to consider the application. But, of course, we only have one vote.”
Reaction across the Middle East was not unmixed, even in Saudi Arabia. A member of the nation’s delegation to OPEC, speaking on condition of anonymity so he could remain in the employ of the King, cited Allah’s usual ways to man in terms of the oil trade, saying, “The eternal wisdom of Allah has provided that no part of the world is able to have more oil than Saudi Arabia. But our King likes to visit George Bush at his ranch in Crawford or wherever he is, so if we see enough gushers blacken the Artic Ocean, I suppose we will bring ourselves to consider U. S. membership.”
The Iranian representative was, expectedly, evasive while definite. “If the U. S. wants to join OPEC, we may say no or yes, never or maybe, later or now. There is, of course, more likelihood that we will say yes or maybe sooner if the U. S. agrees that our proud and progressive Islamic nation has the right to develop nuclear weapons for peaceful purposes.”
When asked about possible opposition to U. S. membership in OPEC, President Bush made no maybes about his intentions, turning to the King first, and saying, “Excuse me for saying this, but you how I’m always forthright.” Then he turned to the reporter, and stated, “We have a backup plan. If the other nations who control OPEC vote against American membership, we intend to form an oil cartel with Canada, which, like our own state of Alaska, borders on the Artic Ocean. Greenland, which also has a presence there, has indicated interest in the cartel, which, by the way, we’ve given the working name of APEC, with the “A” standing for “Artic.” I also plan to invite Russia, which, as you know, borders on the other side of the Artic Ocean, to consider the benefits of membership in APEC.”
Vice President Cheney, flashing his usual fleeting acidic smile at the King, took his turn at the skillful conduct of international relations, adding, “It’s quite a relief to know we’ve got as much oil up north as we do, and frankly, I kind of like the idea of APEC. So just let me say that, with all due deference to the King, the choice for OPEC is clear. It’s their cartel or ours.”
Environmentalists were widely distressed. A leading researcher of the multinational team that extracted the deep cores which indicated the vast reserves said, “It’s disheartening to think that our discovery of how much oil and gas lie under the Artic has led to a desire to extract it. I would have thought everyone would just appreciate the wisdom of leaving it there. Now, I shudder to think how much the combustion of the reserves will contribute to global warming, which, unfortunately, will make it even easier to pump out the oil, since there won’t be any ice left to get in the way.”
Eskimos generally applauded the news, with many expressing an eagerness to trade in their traditional garb for Arabian dress. One Eskimo confided, “If you want to know the truth, I like global warming. We’ve had it cold long enough.”
Everyday Americans at the pump were ecstatic about the prospects of a domestic oil glut. “Wow, just think,” an American SUV driver, who was at a gas station pumping out his wallet, said, “if the U. S. is part of OPEC or forms its own cartel, I might even be able to keep my gas guzzler.”
About the Author:
Tom Attea, humorist and creator of http://newslaugh.com/, has had six shows produced Off-Broadway and has written comedy for TV. Critics have called his writing ""delightfully funny" and "witty" with "good, genuine laughs."