ExxonMobil, Shell, and Saudi Aramco are ramping up output of plastic—which is made from oil and gas, and their byproducts—to hedge against the possibility that a serious global response to climate change might reduce demand for their fuels, analysts say. Petrochemicals, the category that includes plastic, now account for 14 percent of oil use and are expected to drive half of oil demand growth between now and 2050, the International Energy Agency (IEA) says. The World Economic Forum predicts plastic production will double in the next 20 years.

{ Wired | Continue reading | Thanks Tim }

previously { The missing 99%: why can’t we find the vast majority of ocean plastic? }

photo { Kate Ballis }

In 2017, the United States imported approximately 10.14 million barrels per day (MMb/d) of petroleum from about 84 countries. Petroleum includes crude oil, hydrocarbon gas liquids, refined petroleum products such as gasoline and diesel fuel, and biofuels including ethanol and biodiesel. Crude oil accounted for about 79% of U.S. gross petroleum imports in 2017 and non-crude oil petroleum accounted for about 21% of gross petroleum imports.

In 2017, the United States exported about 6.38 MMb/d of petroleum to 186 countries, of which about 18% was crude oil and 82% was non-crude oil petroleum.

The resulting net imports (imports minus exports) of petroleum were about 3.77 MMb/d.

The top five source countries of U.S. petroleum imports in 2017 were Canada (40%), Saudi Arabia (9%), Mexico (7%), Venezuela (7%), and Iraq (6%).

The top five destination countries of U.S. petroleum exports in 2017 were Mexico (17%), Canada (14%), China (7%), Brazil (6%), Japan (5%).

{ EIA | Continue reading }

still { The Oily Maniac, 1976 }

2017 was a big year for Norway’s sovereign wealth fund, already the largest in the world. After surpassing $1 trillion in assets, the fund announced today that it made an annual return of 1,028 billion kroner ($131 billion), the largest amount in the fund’s 20-year history. […]

how many stocks this fund already owns: 1.4% of all listed stocks in the world […] its biggest boost last year came from Apple. It has a 0.9% stake in the US tech company […]

The fund has now made more money in investment returns than was put into it […] since inception in 1997

{ Quartz | Continue reading }

art { Jan van Eyck, The Arnolfini Portrait, 1434 }

Of all the criticisms aimed at fracking, charges that it might increase the incidence of STDs – specifically gonorrhea – are seldom heard.

Yet there might be a link – according to a new research paper published in the Journal of Public Health Policy. […]

We find that fracking activity is associated with a 20 per cent increase in gonorrhea.

{ Improbable | Continue reading }

America’s largest city, 8.5 million strong, is taking decisive action on two separate fronts. We are demanding compensation from those who profit from climate change. And we plan to withdraw our formidable investment portfolio from an economic system that is harmful to our people, our property and the city we love and invest it in more productive ways. This week, the City of New York filed a lawsuit in federal court against the five investor-owned fossil fuel companies: Exxon, BP, ConocoPhillips, Shell and Chevron. We are seeking billions of dollars in damages from these giants because they are central actors in this crisis. We’re proud to join cities like San Francisco, Oakland and Santa Cruz in taking on Big Oil in court.

{ Bill de Blasio, Mayor of New York City | Washington Post }

latex, rope, string, and wire { Eva Hesse, no title, 1969–70 }

An analysis of drinking water sampled from three homes in Bradford County, Pa., revealed traces of a compound commonly found in Marcellus Shale drilling fluids, according to a study published on Monday.

The paper, published in the Proceedings of the National Academy of Sciences, addresses a longstanding question about potential risks to underground drinking water from the drilling technique known as hydraulic fracturing, or fracking. The authors suggested a chain of events by which the drilling chemical ended up in a homeowner’s water supply. […]

The industry has long maintained that because fracking occurs thousands of feet below drinking-water aquifers, the drilling chemicals that are injected to break up rocks and release the gas trapped there pose no risk. In this study, the researchers note that the contamination may have stemmed from a lack of integrity in the drill wells and not from the actual fracking process far below. The industry criticized the new study, saying that it provided no proof that the chemical came from a nearby well.

{ NY Times | Continue reading }

On January 2, 1977, the Shah of Iran made a painful admission about his country’s economy. “We’re broke,” he confided bluntly to his closest aide, court minister Asadollah Alam, in a private meeting. Alam predicted still more dangers to come: “We have squandered every cent we had only to find ourselves checkmated by a single move from Saudi Arabia,” he later wrote in a letter to the shah. “[W]e are now in dire financial peril and must tighten our belts if we are to survive.”

The two men were reacting to recent turmoil in the oil markets. A few weeks prior, at an OPEC meeting in Doha, the Saudis had announced they would resist an Iran-led majority vote to increase petroleum prices by 15 percent. (The shah needed the boost to pay for billions in new spending commitments.) King Khalid bin Abdulaziz Al Saud argued that a price hike wasn’t justified when Western economies were still mired in a recession — but he was also eager to place economic constraints on Iran at a time when the shah was ordering nuclear power plants and projecting influence throughout the Middle East. So the Saudis “flooded the markets,” ramping up oil production from 8 million to 11.8 million barrels per day and slashing crude prices. Unable to compete, Iran was quickly driven from the market: The country’s oil production plunged 38 percent in a month. Billions of dollars in anticipated oil revenues vanished, and Iran was forced to abandon its five-year budget estimates.

A damaging ripple effect persisted: Over the summer of 1977, industrial manufacturing in Iran fell by 50 percent. Inflation ran between 30 and 40 percent. The government made deep cuts to domestic spending to balance the books, but austerity only made matters worse when thousands of young, unskilled men lost their jobs. Before long, economic distress had eroded middle-class support for the shah’s monarchy — which collapsed two years later in the Iranian Revolution.

[…]

In November 2006, Nawaf Obaid, a Saudi security consultant connected to Prince Turki al-Faisal, then Saudi Arabia’s ambassador to Washington, wrote an op-ed in the Washington Post noting that if “[i]f Saudi Arabia boosted production and cut the price of oil in half … it would be devastating to Iran … [and] limit Tehran’s ability to continue funneling hundreds of millions each year to Shiite militias in Iraq and elsewhere.” Two years later, at the height of the global financial crisis, the Saudis acted: They flooded the market, and within six months, oil prices had fallen from their record high of $147 per barrel to just $33. Thus, Iranian President Mahmoud Ahmadinejad began 2009, an election year, struggling with the sudden collapse in government oil revenues and forced to slash popular subsidies and social programs. The election’s contested outcome was accompanied by economic contraction and the worst political violence in Iran since the fall of the shah.

{ Foreign Policy | Continue reading }

image { Evander Batson }

previously { The Conventional Wisdom On Oil Is Always Wrong }

It’s an exciting time to be in the energy industry in America. The impact of unconventional oil and gas development on the U.S. economy is considerable, with potentially hundreds of billions of dollars in investments, millions of new jobs, and a renaissance of American ingenuity and innovation.

In thinking about what is to come, looking back five years helps set the stage. January 2008: The energy sector was facing the great recession, high current and future expected natural gas prices, and job losses to China. There was a generally poor outlook for the energy industry and the economy.

Few could have predicted the changes that were to come.  Unforeseen happenings include the North Dakota oil rush, liquefied natural gas facilities being used as export facilities (instead of as import facilities as originally planned), railroads hauling crude oil, and jobs coming back from China. And, this is just the beginning. The commencement of the crude oil and natural gas revolution can be boiled down to one simple equation:

Abundant resources + cost effective extraction = high production levels of unconventional oil and gas.

The net effect is a reshaping of the U.S. energy industry and our economy.

{ Forbes | Continue reading }

In 1979, Brenda and Richard Jorgenson built a split level home in the midst of a large ranch outside the tiny town of White Earth, North Dakota. […] For most of their lives the landscape of the region has been dominated by agriculture – wheat, alfalfa, oats, canola, flax, and corn. The Jorgensons always figured they would leave the property to their three children to pursue the same good life they have enjoyed.

Then the oil wells arrived. They began appearing in 2006, and within just a few years dominated the area landscape. Today at least 25 oil wells stand within two miles of the Jorgensons’ home, each with a pump, several storage tanks, and a tall flare burning the methane that comes out of the ground along with the petroleum.

Like most people in North Dakota, the Jorgensons only own the surface rights to their property, not the subsurface mineral rights. So there was nothing they could do when, in May 2010, a Dallas-based oil company, Petro-Hunt, installed a well pad on the Jorgensons’ farm, next to a beloved grove of Russian olive trees. […] Some 80 trees were dead by the summer of 2011.

{ Guardian | Continue reading }

artwork { Basquiat, Untitled, 1982 }

related { Ukraine Crushed in $1.1bn Fake Gas Deal | Thanks GG }

These two charts represent what is arguably the biggest thing that is changing in the U.S. economy these days. Not only is the price of natural gas declining significantly, but it is getting cheaper relative to crude oil by leaps and bounds. And it’s all thanks to new drilling technology (fracking) that has resulted in huge new natural gas discoveries and production in the U.S.

{ Scott Grannis | Continue reading | MoneyCNN }

Oil and gas production in the United States and North America is going to skyrocket in the next 8 years due to strides in natural resource extraction, write Citi analysts in a report published yesterday. In fact, they went so far as to call North America “the new Middle East,” at least in terms of oil production. (…)

Citi economists expect total liquids production to as much as double for the continent in the next decade, and predict that the U.S. could overtake both Russia and Saudi Arabia in oil production by 2020.

{ BusinessInsider | Continue reading }

In a Wall Street Journal op-ed article, titled “Move Over, OPEC — Here We Come,” Ed Morse, a former deputy secretary of state for international energy policy, said: “I’m thinking that actually the U.S. is the fastest-growing oil-producing country in the world, the fastest-growing gas-producing country in the world, and yes, it’s happening mostly on private lands,” he said. “This has happened despite whatever politics have intruded on it.”

{ CNBC | Continue reading }

quote { Fernandel in Marcel Pagnol’s Le Schpountz, 1938 }

A fortuitous combination of ravenous bacteria, ocean currents and local topography helped to rapidly purge the Gulf of Mexico of much of the oil and gas released in the Deepwater Horizon disaster of 2010, researchers reported on Monday.

After spewing oil and gas for nearly three months, the BP PLC well was finally capped in mid-July 2010. Some 200,000 tons of methane gas and about 4.4 million barrels of petroleum spilled into the ocean. Given the enormity of the spill, many scientists predicted that a significant amount of the resulting chemical pollutants would likely persist in the region’s waterways for years.

According to a new federally funded study published Monday by the National Academy of Sciences, those scientists were wrong. By the end of September 2010, the vast underwater plume of methane, plus other gases, had all but disappeared. By the end of October, a significant amount of the underwater offshore oil—a complex substance made from thousands of compounds—had vanished as well.

{ WSJ | Continue reading }

How do I drill for oil in my back yard?

This is a great idea. (…) Do you own the mineral rights under your property? In many countries the government automatically owns all significant mineral deposits, no matter whose land they’re under. Here in the U.S., both the surface rights to a property and the mineral rights below can be privately owned, but they’re separable — acquiring the former doesn’t necessarily mean you’re getting the latter. (…)

If the rights are yours, you can either use them yourself or lease them to an oil company.

{ The Straight Dope | Continue reading }

image { Alison Rossiter, Acme Kruxo, exact expiration date unknown, ca. 1940s, processed in 2010 }

The U.S. economy has finally started to create jobs at a reasonable clip. Inflation is still low. Corporate profits are healthy, and surveys of business conditions suggest that the recovery is, as the Federal Reserve recently put it, “on a firmer footing.” So are happy days here again? Hardly.

Last month, consumer confidence plunged, and pundits are still talking about the possibility of a double-dip recession. Some of this can probably be put down to the general atmosphere of geopolitical turmoil—the threat of nuclear catastrophe in Japan, continued debt problems in Europe, political upheaval in the Middle East.

But, economically speaking, the source of the anxiety is something much more specific: high prices at the gas pump. The price of oil has risen thirty dollars a barrel since February and more than forty per cent since last summer, and the fear is that expensive oil may bring stagflation, as it did during the oil crises of 1973 and 1979, or even put the economy back into reverse. (…)

Last month’s drop in consumer confidence was attributed almost entirely to the spike in gas prices, in line with a 2007 study, by the economists Paul Edelstein and Lutz Kilian, showing that spikes in oil prices have often depressed public sentiment in the past.

{ The New Yorker | Continue reading }

image { Edward Ruscha, Lion in Oil, 2002 }

related { China’s energy use should flatten out sometime around 2030 }

The Prime Minister of Japan recently stated that his nation was facing its worst crisis since World War II. While most of the world is focused on tragic images of floodwater and rubble, and fixated on radiation levels, there is a bigger picture to be examined – one that also includes  energy, coal and the Strait of Hormuz.

The geography of the Persian Gulf is extraordinary. It is a narrow body of water opening into a narrow channel through the Strait of Hormuz. Any diminution of the flow from any source in the region, let alone the complete closure of the Strait of Hormuz, would have profound implications for the global economy.

For Japan it could mean more than higher prices. It could mean being unable to secure the amount of oil needed at any price. The movement of tankers, the limits on port facilities and long-term contracts that commit oil to other places could make it impossible for Japan to physically secure the oil it needs to run its industrial plant. On an extended basis, this would draw down reserves and constrain Japan’s economy dramatically. And, obviously, when the world’s third-largest industrial plant drastically slows, the impact on the global supply chain is both dramatic and complex.

{ George Friedman | Continue reading }

Nuclear plants in France, Germany, and the U.S. are far more automated than in Japan, where more controls are based on manual decisions, switches, and reactions, says Roger Gale, a nuclear industry consultant and former official at the U.S. Department of Energy who served as a consultant to Tepco for 20 years. He thinks U.S. utilities would have acted more quickly in a similar disaster. “[Tepco] probably reacted more slowly in the initial case than they needed to.”

Gale says a culture of complacency within Tepco may also have contributed to the crisis. Tepco has massive cash flows and a reputation for hiring the best and brightest engineers in Japan. However, Gale says, an array of management problems–a lack of transparency, problems with record keeping, relying on manual rather than automatic controls, and being slow on the draw when making decisions—plague the organization.

{ Fast Company | Continue reading }

At this point in the Japanese nuclear emergency it is coming down to the simple proposition of how do you drop enough water on the stricken reactors, and especially the spent fuel ponds, to keep further damage from happening?

{ Robert X. Cringely | Continue reading | And: Japan Takes Extraordinary Measures to Cool Nuclear Plant }

related { CNN/Money jumps on the fear bandwagon with this interactive graphic }

Disaster and rebirth is an old story in this part of the country. I know. My family has lived that cycle for generations deep in the Mississippi Delta—in Plaquemines Parish, a name that since the British Petroleum (BP) oil spill has become a cultural marker, the equal, after Katrina, of “the Lower Ninth Ward.” But the oil spill? Will it prove one too many disasters for the return of the Plaquemines Parish my family once knew? Or will it, like Hurricane Katrina, be a dangerous opportunity for changes long overdue?


As much of America suddenly knows, the mouth of the Mississippi River and the surrounding marshlands of Plaquemines Parish nurture the foodstuffs that grace the tables of New Orleans’s world-famous restaurants and provide much of the seafood—25 to 30 percent of it—that Americans eat. Over two centuries the region’s diverse, amphibious Delta culture—Alsatian, Croatian, Isleño, African American, Italian, and Native American—also nurtured my family’s culinary roots that flowered into the Ruth’s Chris Steak House restaurant empire.

{ Randy Fertel/Gastronomica | Continue reading }

photo { Jessica Craig-Martin }

Is it OK to cook with extra-virgin olive oil?

One of the main things to consider when evaluating whether it is OK to heat extra-virgin olive oil (or any other oil for that matter) is the smoke point of the oil. The smoke point is the temperature at which visible gaseous vapor from the heating of oil becomes evident. It is traditionally used as a marker for when decomposition of oil begins to take place. Since decomposition incurs chemical changes that may not only result in reduced flavor and nutritional value but also the generation of harmful cancer causing compounds (oxygen radicals) that are harmful to your health, it is important to not heat oil past its smoke point. Inhaling the vapors can also be damaging.

{ WH Foods | Continue reading }

Although the audio program Auto-Tune is best known for the singing-through-a-fan, robotic vocal style that has dominated pop radio in recent years with stars like Lady Gaga, T-Pain and countless others, Auto-Tune is in fact widely used in the studio and at concerts to make artists’ sound pitch-perfect.

“Quite frankly, [use of Auto-Tune] happens on almost all vocal performances you hear on the radio,” said Marco Alpert, vice president of marketing for Antares Audio Technologies, the company that holds the trademark and patent for Auto-Tune.

The beauty of Auto-Tune, Alpert said, is that instead of an artist having to sing take after take, struggling to get through a song flawlessly, Auto-Tune can clean up small goofs. (…)

Auto-Tune’s invention sprung from a quite unrelated field: prospecting for oil underground using sound waves. Andy Hildebrand, a geophysicist who worked with Exxon, came up with a technique called autocorrelation to interpret these waves. During the 1990s, Hildebrand founded the company that later became Antares, and he applied his tools to voices.

The recording industry pounced on the technology, and the first song credited (or bemoaned) for introducing Auto-Tune to the masses was Cher’s 1998 hit “Believe.”

Although a success with audio engineers, Auto-Tune remained largely out of sight until 2003 when rhythm and blues crooner T-Pain discovered its voice-altering effects.

{ LiveScience | Continue reading }

The Gulf Oil Spill Disaster

First, let’s begin with the “good” news. The ecological destruction that was first feared is not going to be as bad as once thought, for a variety of reasons. It is not good, but it is not the unmitigated disaster it could have been.

Edward Overton, PhD, Professor Emeritus, Dept. of Environmental Sciences, LSU, is an expert on oil spills. He was at the Exxon Valdez. The Exxon Valdez (EV) was a big, black, thick tide of oil. The Deepwater Horizon is a much bigger spill: every ten days the amount of the EV spill spewed into the Gulf, from April 20 to July 15. Professor Overton spoke mostly for the record. He is very much a concerned environmentalist, and he is also a very serious scientist.

He reminded us that the Louisiana wetlands are a very important part of the ecological system of the Gulf of Mexico. Oversimplifying, they are the nutrient source for the small animal world which feeds the larger. Without the wetlands much of the Gulf ecosystem dies. If they were destroyed, they would not come back very easily, as without their very root system the land would erode away. Bluntly, oil kills wetlands if it gets into it.

There are only three ways to get rid of an oil spill. You can mechanically remove it, chemically remove it, or burn it. They used all three methods. But not fast enough. The Obama administration dithered while Rome burned. (This is not from Overton.) (…)

What should have been a no-brainer decision to use the Dutch ships was delayed for whatever reason. What should have been a no-brainer decision to waive the water purity rules was delayed beyond reason. My personal opinion. Whoever participated in that decision should be allowed to return to the private sector. They only made the problem of the spill worse. They should not be allowed near the decision-making process again.

Please note, this is no defense of British Petroleum. As noted below, they were extremely negligent, and deserve the costs and more. We just don’t need to compound stupid, incompetent, irresponsible (choose several more adjectives, some with color) corporate acts with dumb government ones.

There is a chemical called Corexit that is a product line of solvents primarily used as dispersants for breaking up oil slicks. It is produced by Nalco Holding Company. Corexit was the most-used dispersant in the Deepwater Horizon oil spill in the Gulf of Mexico, with COREXIT 9527 having been replaced by COREXIT 9500 after the former was deemed too toxic. Oil that would normally rise to the surface of the water is broken up by the dispersant into small globules that can then remain suspended in the water.

In hindsight, Overton thinks the use of Corexit was the correct thing to do. It probably saved the wetlands. But it is not without its own bad effects.

When you put Corexit on an oil slick, the surface oil disperses but also drops into the ocean about 15 feet. While Corexit (basically a type of soap) itself is not toxic (an admittedly controversial claim), the resulting dispersed oil is quite toxic. Fish swimming through it can be and are harmed. Marine mammals like porpoises are seriously harmed when they rise to breathe through an oil slick.

But here is the good news. It turns out that there are about the equivalent of two Exxon Valdezes a year from natural oil seepage from the floor of the oceans. The Gulf has an ecosystem of bacteria that eat that oil, which are then eaten again by plankton. To those bacteria, dispersed oil is filet mignon. They thrive and grow rapidly, turning that toxic waste into nutrients, which are absorbed by the plankton. The bacteria keep on growing until they lose their source of nutrition (the toxic oil) and then die out over time. Note: once absorbed by the bacteria, the oil is no longer toxic. There are no toxic minerals like mercury introduced into the ecosystem.

{ John Mauldin | Continue reading | PDF }

update: