Category - Global Energy

Burning Hell Coming for Mideast Deserts

Discovery News, By Eric Niiler, October 26

If any place could be described as a living hell, it might be the desert regions of the Middle East. Hot, dry, dusty and arid, these harsh landscapes still manage to support cities populated by tens of millions of people who rely on air conditioning to survive.

Now scientists say that by the end of the century, the effects of climate change will push the region into a zone that surpasses the limits of human survival. They believe that most any outdoor activity will be hazardous.

“This is a significantly more severe type of heat wave than what people have experienced before,” said Elfatih Eltahir, professor of civil and environmental engineering at the Massachusetts Institute of Technology.

Quick! Get the oil out before it gets too hot!

Nature Climate Change: Future temperature in southwest Asia projected to exceed a threshold for human adaptability

Exxon’s Own Research Confirmed Fossil Fuels’ Role in Global Warming Decades Ago

Top executives were warned of possible catastrophe from greenhouse effect, then led efforts to block solutions.

Inside Climate News, By Neela Banerjee, Lisa Song & David Hasemyer, September 16

At a meeting in Exxon Corporation’s headquarters, a senior company scientist named James F. Black addressed an audience of powerful oilmen. Speaking without a text as he flipped through detailed slides, Black delivered a sobering message: carbon dioxide from the world’s use of fossil fuels would warm the planet and could eventually endanger humanity.

“In the first place, there is general scientific agreement that the most likely manner in which mankind is influencing the global climate is through carbon dioxide release from the burning of fossil fuels,” Black told Exxon’s Management Committee, according to a written version he recorded later.

It was July 1977 when Exxon’s leaders received this blunt assessment, well before most of the world had heard of the looming climate crisis.

A year later, Black, a top technical expert in Exxon’s Research & Engineering division, took an updated version of his presentation to a broader audience. He warned Exxon scientists and managers that independent researchers estimated a doubling of the carbon dioxide (CO2) concentration in the atmosphere would increase average global temperatures by 2 to 3 degrees Celsius (4 to 5 degrees Fahrenheit), and as much as 10 degrees Celsius (18 degrees Fahrenheit) at the poles. Rainfall might get heavier in some regions, and other places might turn to desert.
Read More

Obama Administration Says Yes To Drilling In The Arctic

Climate Progress, by Emily Atkin, May 11

The Obama administration has given conditional approval to a controversial proposal by Royal Dutch Shell to drill for oil in the Arctic Ocean this summer.

On Monday, the Department of Interior’s Bureau of Ocean Energy Management (BOEM) approved Shell’s exploration plan for the Chukchi Sea, which entails drilling up to six wells approximately 70 miles northwest of Wainwright, Alaska. The plan is for exploratory drilling, a sort of first step that companies take to determine whether a region is feasible for large-scale production.

In announcing the conditional approval, BOEM cited its recently-issued safety regulations for drilling in the U.S. portion of the Arctic Ocean, including the Chukchi Sea, where big oil companies have long been hoping to lay their claim. Those regulations require companies to have contingency plans for mishaps — companies must be able to “promptly deploy” emergency containment equipment to deal with a spill, and must build a second rig close to their initial operations so a relief well could be drilled in the event of a blowout, among other things.

“We have taken a thoughtful approach to carefully considering potential exploration in the Chukchi Sea, recognizing the significant environmental, social and ecological resources in the region and establishing high standards for the protection of this critical ecosystem, our Arctic communities, and the subsistence needs and cultural traditions of Alaska Natives,” BOEM Director Abigail Ross Hopper said in a statement. “As we move forward, any offshore exploratory activities will continue to be subject to rigorous safety standards.”

Shell Will Buy BG Group for $70 Billion in Cash and Shares

Bloomberg Business, By Joe Carroll, Javier Blas, & Rakteem Katakey, April 8

Royal Dutch Shell Plc agreed to buy BG Group Plc for about 47 billion pounds ($70 billion) in cash and shares, the oil and gas industry’s biggest deal in at least a decade.

The acquisition is the most significant response yet to the slump in oil prices and could set in motion a series of mergers as the largest energy companies look to cut costs and restore profits.


The merged company, led by Shell Chief Executive Officer Ben van Beurden, will boast a market value twice the size of BP Plc and surpass Chevron Corp. Shell, struggling to rebound from its worst production performance in 17 years, will swell its oil and natural gas reserves by 28 percent with the combination and inherit a management team that carved out a unique niche in liquefied natural gas, or LNG.

Shell, which helped pioneer the process of liquefying gas for shipment aboard tankers decades ago, and rivals such as Chevron are betting LNG will play an increasing role in emerging economies seeking alternatives to dirtier energy sources such as coal.

Auto-start video at the link…

East Coast offshore drilling proposed for first time

Five-year offshore drilling plan to include Atlantic coast as well as Gulf of Mexico and Alaska.

Al Jazeera, By Renee Lewis, January 27

The Department of the Interior (DOI) has released a draft proposal of its five-year plan for offshore oil and gas leasing, which includes opening up areas of the Atlantic Ocean that have previously been off-limits, a move that worries conservationists.

The proposal includes 14 potential lease sales of drilling sites, including 10 in the Gulf of Mexico, three off the coast of Alaska and one in the middle to southern Atlantic, according to a DOI announcement on Tuesday. It said areas off the Pacific coast were not included in the draft proposal due to West Coast states’ historical opposition to oil and gas development. “The safe and responsible development of our nation’s domestic energy resources is a key part of the President’s efforts to support American jobs and reduce our dependence on foreign oil,” Secretary of the Interior Sally Jewell said in the release.


“This is a balanced proposal that would make available nearly 80 percent of the undiscovered technically recoverable resources, while protecting areas that are simply too special to develop,” Jewell said.

Coal Companies Are Selling Coal To Themselves To Get More Government Subsidies

Climate Progress, By Claire Moser, January 7

In what is being described as a fundamental shift in how the coal industry does business, over 40 percent of all coal produced in Wyoming is now being first sold not to a power plant or a utility, but to a subsidiary of the same company that mined the coal — a 17-fold increase since 2004 for the U.S.’s largest coal-producing state.

According to a new report by the Center for American Progress, these inside deals between coal companies and their own subsidiaries (known as “captive transactions”) are aimed, in part, at intentionally dodging federal and state royalty payments and maximizing taxpayer-funded subsidies from the U.S. Department of the Interior.

The CAP review, released on Tuesday, found that five of the largest coal companies operating in the Powder River Basin in Wyoming and Montana have collectively created a network of 566 subsidiary companies through which they sell and market coal. Peabody Energy alone, which operates the country’s largest coal mine in Wyoming, boasts 242 domestic and foreign subsidiaries, with names like Coal Sales II, LLC.

Under current regulations, coal companies pay royalties on the first sale to another company after mining coal on federal land. The coal then can be bought and sold multiple times until it reaches a final destination and is sold to an end user, such as a power plant where it is burned for electricity. By building up hundreds of subsidiaries, coal companies have been able to sell to their own companies and partners, allegedly paying royalties based on an artificially low sale price. The CAP analysis presents evidence that captive transactions are common practice in the coal industry and regularly exploited to evade royalty payments and maximize subsidies.

“Increasingly, the major coal companies are selling Powder River Basin coal not on an open market, but to an elaborate network of shell companies that they own and control,” said Matt Lee-Ashley, a Senior Fellow and Director of the Public Lands Project at CAP in a press release. “This gaming of the system is costing federal and state governments millions of dollars in lost royalty payments and giving the Powder River Basin an unfair advantage over other U.S. coal producing regions.”

U.A.E. Sees OPEC Output Unchanged Even If Oil Falls to $40

Bloomberg, By Anthony DiPaola & Mahmoud Habboush, December 14

OPEC will stand by its decision not to cut crude output even if oil prices fall as low as $40 a barrel and will wait at least three months before considering an emergency meeting, the United Arab Emirates’ energy minister said.

OPEC won’t immediately change its Nov. 27 decision to keep the group’s collective output target unchanged at 30 million barrels a day, Suhail Al-Mazrouei said. Venezuela supports an OPEC meeting given the price slide, though the country hasn’t officially requested one, an official at Venezuela’s foreign ministry said Dec. 12. The group is due to meet again on June 5.

“We are not going to change our minds because the prices went to $60 or to $40,” Mazrouei told Bloomberg at a conference in Dubai. “We’re not targeting a price; the market will stabilize itself.” He said current conditions don’t justify an extraordinary OPEC meeting. “We need to wait for at least a quarter” to consider an urgent session, he said.

OPEC’s 12 members pumped 30.56 million barrels a day in November, exceeding their collective target for a sixth straight month, according to data compiled by Bloomberg. Saudi Arabia, Iraq and Kuwait this month deepened discounts on shipments to Asia, feeding speculation that they’re fighting for market share amid a glut fed by surging U.S. shale production. The Organization of Petroleum Exporting Countries supplies about 40 percent of the world’s oil.

Will Lima climate talks pave way for a binding treaty in Paris in 2015?

Failure will condemn developing countries to unchecked climate change for another generation, and the poorest countries will be worst hit

The Guardian, By John Vidal, November 30

When, on Monday morning in Peru, 4,000 diplomats from the world’s 196 countries start their mammoth session to negotiate a new legally-binding global climate deal, they will know they are in the last chance saloon. COP 20 in Lima is the last full meeting before Paris in a year’s time, when the deal is due to be signed. If countries cannot bury most of their differences on the major issues by Friday week, then the chances of a meaningful agreement next year are slim.

The result of failure would be that developing countries are condemned to unchecked climate change for another generation, and the UN process which relies on consensus to get results is fatally undermined.

On the surface, all is going to the plan of the rich countries and the big emitters. Presidents Barack Obama and Xi Jinping of China, who between them are responsible for 42% of the world’s greenhouse gas emissions, have agreed a deal on climate change. The US will cut US emissions to 26-28% below 2005 levels by 2025, while China has pledged that emissions will fall after 2030. Europe, meanwhile, has agreed to a binding 40% cut by 2030 from 1990 levels. In addition, rich countries have pledged $9.7bn to the new UN Green Climate Fund (GCF). And it has been agreed that, by March next year, every country in the world will have established plans for reducing or constraining emissions as well as producing detailed plans on how they intend to fund climate adaptation.

In reality, the questions start here.

OPEC move puts US shale in tight spot

AFP, November 28

New York – In taking no action on production Thursday, OPEC did the opposite of what it usually does. It effectively rubber-stamped a supply glut that already has sent prices plunging.

But to many analysts, the cartel’s seeming enthusiasm for lower crude oil prices was not really all that surprising. Rather, the tactic made sense in light of an American shale boom that has put OPEC on the defensive.

“OPEC is all in and will continue to flood the globe with oil in an effort to bury the US shale oil producer,” said Phil Flynn, senior market analyst at the Price Futures Group.

“It is an all-out production war and it is game on, all the barrels are on the table and for OPEC it is life or death.”


Despite the carnage, US oil industry officials brushed off suggestions the American shale boom will die.

“It’s certainly a test, but it’s certainly not an exit,” said Fred Lawrence, a vice president at the Independent Petroleum Association of America.

“US oil producers can handle more pain than OPEC imagines.”

IBT: Opec: Oil Prices Are Falling Fast and This is Why