ODAC News
Wednesday 23 May
The Oil Depletion Analysis Centre
1a/ Darling: lights could go out if power plants are not built [UK]
(The Herald, Sat 19 May)
1b/ Fears
over looming energy crisis in UK
(The Sunday Times, Sun 20 May)
1c/ ‘No
chance of nuclear power in Scotland’
(The Herald, Mon 21 May)
2a/ EU
bid to wean itself off Russian gas: Nabucco pipeline
(Yahoo News, Fri 18 May)
2b/ Kazakh
Gas Will Cost Gazprom $160 per 1,000 cu m
(FC Novosti, Tue 15 May)
3a/ Car Imports in Russia Up 65% to 289,900 in 1Q07
(FC Novosti, Mon 14 May)
3b/ Foreign
Cars Sales in Russia Up 72% in January-April
(FC Novosti, Thu 10 May)
4/ Drought puts pressure
on electricity (The Age [Melbourne], Sat 19 May)
5/ Mediterranean gasoline
prices rise as US driving season approaches (Platts, Mon 14
May)
6a/ The
Sands of Time – How Venezuela and Canada are Extending the Life of the World’s Petroleum Resources (OPEC
Bulletin, March 2007)
6b/ 'America's
energy security blanket' (Financial Times, Mon 21 May)
7/ 'Era of cheap energy
is over,' says Buckee
(Calgary Herald, Thu 10 May)
8a/ Financial bubble - who will say that the emperor is naked?
(The Oil Drum:
8b/ Bubbles
are everywhere (The Sunday Times, Sun
20 May)
9/ Battle for the Barrels
[new book] (Duncan Clarke, Feb
2007)
10/ Petroleum
Resources Of The Western Desert of Iraq [not 100B barrels]
(Middle East Economic Survey, Mon 21 May)
11a/ OPEC
must add more oil to the market to avoid record prices – CGES
(Forbes, Mon 21 May)
11b/ Iranian
Energy Sector In Crisis, Says CGES
(
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1a/ Darling: lights could go out if power plants are not built [
http://www.theherald.co.uk/politics/news/display.var.1411310.0.0.php
Comment: Not for the first time, Alastair Darling, the UK Trade and Industry [Energy]
Minister, prepares the
Article: Alistair Darling has warned
that the lights could go out unless the issue of the
The trade and industry secretary is to unveil the
government's plans to limit climate change damage and secure the country's
energy supply with an impassioned plea for a serious approach to be taken to
meeting the challenge of energy supplies.
He will say it is essential to make the
1b/ Fears over looming energy crisis in
http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article1813006.ece
Article: ACROSS
This is not the postapocalyptic
vision of some film-maker, but a realistic scenario as
“The idea of the lights going out is not a fantasy.
People seem to accept that security of energy supply is a right. It is not. The
industry will have to work hard to maintain supply and for that we need a clear
framework,” said Simon Skillings, director of
strategy and energy policy at Eon UK,
... The big question is whether the
1c/ ‘No chance of nuclear power in
Comment: Part of the
Article: First Minister Alex Salmond has placed Holyrood on a collision course with
Mr Brown has given his backing to a new wave of
nuclear plants by 2020 and the details will be contained in a white paper being
published by the government on Wednesday.
Alistair Darling, the Trade and Industry Secretary, is
expected to say that new stations are essential if
advertisementBut
Mr Salmond, the newly elected First Minister,
yesterday said he would use Holyrood's control of
planning laws to block nuclear power plants north of the border.
His comments came as a poll of MSPs found that more
than half were opposed to new nuclear power stations in
... The poll of MSPs, which was conducted on behalf of
Friends of the Earth Scotland, suggests that any attempts to build new nuclear
power stations north of the border would be blocked. Of the 99 MSPs who
responded, 72 said they were opposed to new plants, 24 were in favour and three
were undecided...
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2a/ EU bid to wean itself off Russian gas: Nabucco pipeline
(Yahoo News, Fri 18 May)
http://news.yahoo.com/s/csm/20070518/wl_csm/onabucco;_ylt=AtowAjPjSOk_TUxtco02ONkPLBIF
Comment: Good discussion on the Nabucco
pipeline. This article states that initial supplies of gas for the pipeline
are due to come from
Article: After two consecutive winters
that saw
But
"I think the EU's
political people will try to play it down, but ... for Nabucco, this definitely
is a huge loss," says Zeyno Baran,
a Central Asia expert at the conservative Hudson Institute in
... But despite Russian efforts to undermine the $6
billion Nabucco pipeline, which enters its engineering phase next month, the
project has not been derailed, says the five-member consortium behind it.
"It is neither dead nor is it delayed. Our main
activities are on schedule," says Reinhard Mitschek, Nabucco's managing
director. "Due to the variety of potential gas sources, single events and
done deals between other market players will not jeopardize the project."
Nabucco, which is overseen by a consortium of five
European energy companies – one from each of the five countries the pipeline
would cross – is scheduled to break ground in 2009 and involves several
construction phases. The pipeline is expected to be on line by 2012, pumping
gas in an initial phase between
The pipeline would eventually pump gas from the
Caspian region, including
2b/ Kazakh Gas Will Cost Gazprom $160 per 1,000 cu m
(FC Novosti, Tue 15 May)
http://www.fcinfo.ru/themes/basic/materials-rfcm-index.asp?folder=3192&pg=2
Comment: Gazprom now paying $160/1000
cu m for Kazakh gas. This is much higher than the previous price of about
$100/1000 cu m, and until about a year ago, $60/1000 cu m. Gazprom will
re-export some of the gas to
Article: Next week Russian gas
monopoly Gazprom will sign an agreement with
[The article goes on to say that Kazmunaigaz
will supply the gas for the joint venture, and some of the gas is for
re-export]
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3a/ Car Imports in
http://www.fcinfo.ru/themes/basic/materials-rfcm-index.asp?folder=3352&pg=2
Article: Car imports in Russia reached
289,900 in January-March 2007, an increase of 64.7% against the same period
last year (177,100 cars), reported the Federal Customs Statistics Service. Out
of that number, 255,600 cars were imported from countries outside the CIS. In monetary
terms, imports totalled $3.728bn against $2.062bn in the same period last year.
3b/ Foreign Cars Sales in
http://www.fcinfo.ru/themes/basic/materials-rfcm-index.asp?folder=3352&pg=2
Article: Sales of foreign cars in
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4/ Drought puts pressure on electricity
(The Age [Melbourne], Sat 19 May)
Article: The water shortage across
eastern
"I think we are in denial, and are going to have
brownouts in NSW if we don't get snow this winter," a source within the
electricity market said.
Coal and hydro power generation require very large
amounts of water, and the Snowy scheme depends on it for 86 per cent of its
generation capacity.
"Last year we had the lowest snowfall ever
recorded. If this happens again we are in trouble," the source said. He
declined to be named because electricity pricing and supply is a politically
charged subject.
Prices are already tipped to double in
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5/ Mediterranean gasoline prices rise as US driving season approaches
(Platts, Mon 14 May)
http://www.platts.com/Oil/Resources/Podcasts/europe/index.xml
Comment: This is a Platts podcast,
5min 17s long. You do not have to download the file, just click and listen. Very
interesting podcast. Not only are US gasoline stocks low, European stocks
are very low. And for the moment at least, it is more profitable to make
products other than gasoline/petrol. Therefore, despite the potential shortage
and high gasoline/petrol prices, they are going to have to go higher before
more is produced in large quantities (in
Article: In this podcast Simon Thorne,
managing editor for Platts European oil analyses the causal factors for higher
prices in the Mediterranean gasoline market including increased Persian Gulf
demand, rising feedstock prices, and unplanned refinery maintenance across
Europe.
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6a/
The Sands of Time – How Venezuela and Canada are
Extending the Life of the World’s Petroleum Resources
(OPEC Bulletin, March 2007)
http://www.opec.org/library/OPEC%20Bulletin/2007/OB042007.htm
Comment: pp16-29. Best description I
have seen of what tar sands and Venezuelan heavy oil actually are – see p19.
Articles on tar sands and heavy oil tend to emphasize the colossal quantities
involved without making it clear that production from these reserves will never
be great, and this one is no exception.
6b/
'
Comment: Login required. Realistic
assessments of Canadian tar sands have production at about 2Mb/d by 2015, and 3
Mb/d by 2020 max. The FT has gone for a rosier figure, 4m b/d by 2020.
Article: … The scene of the
exploitation of the developed's world's biggest oil
resource is like some dystopian fantasy. Vast pits are carved out of the
forest, where machines toil day and night taking hundred-tonne bites out of the
earth. Mist rises from sluggish lakes of polluted water and great columns of
steam rise into the air.
The process of turning
From about 1.2m barrels a day today, the industry
reckons production could reach 4m b/d by 2020, potentially making Canada the
world's fourth-biggest oil producer, surpassed only by Saudi Arabia, Russia and
the US….
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7/
'Era of cheap energy is over,' says Buckee (Calgary Herald,
Thu 10 May)
Comment: A couple of weeks old, but
notable in that the head of another oil company, Talisman, is prepared to put
his head on the block and not only talk about Peak Oil, but say that it has
arrived already.
Article: Global
oil production has peaked and will soon decline resulting in higher prices for
consumers, Talisman Energy Inc. CEO Jim Buckee said
Wednesday.
"I
believe we're already here (at the peak)," Buckee
said at the company's annual meeting in
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8a/
Financial bubble - who will say that the emperor is
naked?
(The Oil Drum:
http://europe.theoildrum.com/node/2564#more
Article: This
post is not directly about energy, but it is about one of the other big
imbalances of our times - the giant financial bubble that has been inflating
for the past few years, on the heels of the prevous
bubble, the now-infamous dotcom bubble. It is about how society can be blind to
trends that are obvious to many - including amongst those that are in a
position to act and should know better than to do nothing.
I'm on
record saying (repeatedly) that we have a huge, unsustainable asset price
bubble, and that banks are doing insane things right now. And those of you that
have read me previously may remember my quip that a good banker is not one who
is right, it is one who is wrong at the same time as the other bankers (and
thus bankers right now have no incentive not to participate to the increasingly
aggressive deals one can see around).
The scariest
thing is that a large number of senior bankers are aware of what I'm saying,
are on the same line - and are doing nothing about it…
8b/ Bubbles are everywhere (The Sunday Times, Sun 20
May)
http://business.timesonline.co.uk/tol/business/money/investment/article1813029.ece
Comment: Bleak economic outlook for
Article: LAST
year the Chinese market rose 130%. This year it’s
already up another 45%. About 300,000 new trading accounts are opened every day
and one-third of listed companies are valued at more than 60 times earnings.
So when Zhou
Xiaochuan, governor of the People’s
Bank of China, was asked a few weeks ago whether a bubble was forming in the
market it wasn’t that hard for him to figure out the
answer. Yes, he said.
It is hard
to find a market that isn’t in bubble territory these
days.
... Look
first at the
Consumer
credit rose sharply in March by $13.5 billion (£6.8 billion) suggesting, said
Christopher Wood of CLSA, a broker, that with house prices no longer rising and
“the home credit equity line cut off”, American consumers are turning to their
credit cards.
Mastercard saw the
number of transactions using its cards rise by nearly 20% in the first quarter
of 2007. That’s clearly not sustainable. Even with
the growth in card use, consumer spending rose at its slowest pace for five
months in March. Economic growth fell to a miserable 1.3% in the first quarter,
a four-year low, and there could easily be a further – and entirely justified –
growth scare ahead.
Indeed, if
the housing market continues to suffer – note that existing home sales fell
8.4% in March, the biggest drop in 18 years – it is possible the economy might
stop growing altogether.
... In
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9/
No link
Comment: Yesterday a friend in the
Then I posted this article, An Applicable Update on the World oil Market, from Fred
Banks on the ODAC website, also yesterday. Fred, an academic economist who
writes regularly about Peak Oil, and how close it is, is clearly not impressed
by Mr Clarke’s book either.
On Monday, I sent an e-mail enquiry regarding this year’s Oil and Money conference, to someone with an e-mail address
of the form @iht.com, iht = International Herald
Tribune. The IHT are co-convenors of the conference. Yesterday this same
person, from the IHT, forwarded me a publicity e-mail for
The
Duncan Clarke
Published February 2007
One of the world’s foremost
oil experts explains that contrary to popular belief, the oil is not about to
run out…
‘A “must read” antidote to the gloom and doom
conclusions of oil scarcity.’
Peter R. Odell, Professor Emeritus of International
Energy Studies,
It is widely accepted that global discoveries of
conventional oil have peaked and that the era of cheap oil has gone forever.
The
The arguments of Peak Oil’s
adherents are examined and discussed, notably the many issues relevant to
future world oil supplies, such as resource/reserve relationships, rising crude
oil prices,new and future technologies, potential
worldwide exploration acreage, shifting access to restricted oil zones, changes
in government policies, and the growth in unconventional oils.
Dr Duncan Clarke is Chairman & CEO of Global
Pacific & Partners, a private advisory firm operating from offices in
Contact:
Global Pacific & Partners
babette@glopac.com
Order-Online: THE
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10/
Petroleum Resources Of The
http://www.mees.com/postedarticles/oped/v50n21-5OD02.htm
Comment: Last month the energy
consultants IHS released a report that hinted there might be 100B of oil yet to
find in
Moujahed
Al-Husseini and Sadad Al-Husseini, the latter
formerly Saudi Aramco’s Executive Vice President for
Exploration and Producing and a Member of its Board of Directors, in this
article just published by MEES, suggest that a value of 0.5 B barrels might be
closer to the mark. USGS reserve estimates, quoted in the article, have a
tendency to be rather optimistic.
Article: On
18 April 2007, the
This
conclusion stands in stark contrast to the 2004 study by the US Geological
Survey (USGS) and GeoDesign (a consultancy that
specializes in Iraq’s petroleum geology) that
estimated the undiscovered oil resources of Iraq’s
Western Desert to total only 0.5bn barrels at the 95% level of probability, and
1.6bn barrels at the 50% level of probability (Verma,
Ahlbrandt and Al-Gailani,
2004).
... This
discrepancy is paradoxical because the potential petroleum resources of
The analog to the Akkas field is
Besides
Based on
these results, the indications are clear that this vast region (extending from
northwest
Perhaps the
most important conclusion to be drawn from these profoundly contradictory
studies is the need for a higher level of discipline and objectivity in the
process of estimating global oil resources. After all, the difference between
the two studies, in just one region, of nearly 100bn barrels of oil resources
represents nearly 10% of the proven oil reserves of the world. While identical
conclusions from such studies are not realistic, discrepancies that differ by
two orders of magnitude must surely indicate a major flaw in the resource
estimation process.
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11a/ OPEC must add more oil to the market to avoid record prices – CGES
(Forbes, Mon 21 May)
http://www.forbes.com/business/feeds/afx/2007/05/21/afx3741129.html
Comment: The CGES has been warning for
months that the price of crude will go way up this summer unless OPEC starts
pumping at full throttle, which some Peak Oilers believe that it is. Note that
the article states 'One problem and we could see a spike in prices.' A
spike from $70/barrel.
Article: OPEC
must add more oil to the market to avoid a price spike which would match last
year's record of nearly 80 usd, said the Centre for
Global Energy Studies (CGES).
In its
latest monthly market report the research house also said there is an
insufficient level refinery cracking capacity to convert crude into gasoline
and meet this summer's peak demand driving season in the
'The world
needs more oil than OPEC seems willing to supply, making it difficult to avoid
another surge in oil prices over the coming summer,' said the report.
Crude prices
surged above 78 usd last July.
'The worlds
refining system (is) unable to meet the demands placed upon it by consumers,'
it added.
The driving
season, when Americans take to the road for holiday over the summer, begins at
the end of this month.
Gasoline
inventories in the world's top consumer are lower than average levels for this
time of year, according to data from the US Department of Energy.
'As long as
cracking capacity remains inadequate to meet gasoline demand and OPEC responds
by restricting output to keep prices too high to attract purchases from
refiners...the oil markets current period of high and volatile prices will
continue,' said the CGES.
... Looking
ahead, analysts predict that oil prices will remain high throughout the summer
months.
'We see a
lot more risks to the upside than the downside,' said Michael Davies, analyst
at Sucden. He noted 'the situation in
11b/ Iranian Energy Sector In Crisis, Says CGES (
No link, from MEES Headlines newsletter.
Comment: N details of the article, you
need to log in. However, it was a contact in
I
just wanted to call your attention to a piece in MEES (#21 - May 21, 2007)
entitled :
"Iran
Energy Sector in Crisis, says CGES".
With
the typical CGES bias for understatements, there must be lots of fires being
this smoke. Things look really grim these days. Fortunately it is now 14 months
I have retired from NIOC...[National Iranian Oil Company]
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