President no longer worried about CO2: focus on alternative energy is economic says Obama, no mention of climate

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Guest post by Alec Rawls

“President no longer worried about CO2!” That’s what the headlines should have read last week after Obama presented an elaborate argument that alternative energy is the only viable response to high energy prices without ever once mentioning CO2, global warming or climate change. Instead, he presented the need to lessen our reliance on oil purely as an economic imperative.

Back when he thought that global warming was a winning concern Obama used to acknowledge that his anti-CO2 policies were going to cause high energy prices (forcing them to “necessarily skyrocket“). Now he is trying to use the high energy prices that he intentionally caused as a reason to get away from fossil energy. But if we are no longer worried about climate, how about just undoing the anti-fossil-fuel policies that drove prices up in the first place?

Obama’s silence on climate is a testament to how thoroughly the alarmists have lost the climate debate in the eyes of the voting public. Obama can’t even mention climate change (never mind global warming), even in a speech about his own climate-driven policies.

To make his economic argument, Obama puts forward two glaring lies.  Let’s take these whoppers one at a time.

The lie that we are already aggressively developing our fossil resources

From the President’s March 15th energy policy speech at Prince George’s Community College in Largo, Maryland:

Under my administration, America is producing more oil today than at any time in the last eight years. (Applause.) Any time. That’s a fact. That’s a fact. We’ve quadrupled the number of operating oil rigs to a record high. I want everybody to listen to that — we have more oil rigs operating now than ever. That’s a fact. We’ve approved dozens of new pipelines to move oil across the country. We announced our support for a new one in Oklahoma that will help get more oil down to refineries on the Gulf Coast.

Over the last three years, my administration has opened millions of acres of land in 23 different states for oil and gas exploration. (Applause.) Offshore, I’ve directed my administration to open up more than 75 percent of our potential oil resources. That includes an area in the Gulf of Mexico we opened up a few months ago that could produce more than 400 million barrels of oil.

So do not tell me that we’re not drilling. (Applause.) We’re drilling all over this country.

That’s chutzpah, bragging about opening up drilling in the Gulf after using the Deep Horizon spill as an excuse for wiping out the Gulf drilling industry with an illegal moratorium.

Everyone knows about the big anti-oil moves from Obama and the Democrats, like rejecting the Keystone pipeline and continuing to block drilling in ANWR, but if you want a picture of how systematic and extreme their anti-fossil-energy policies have been, take a look at the list compiled by House Natural Resources Committee Chairman Doc Hastings. As soon as they got in the Obamatons started revoking all the permits that were in the pipeline: for exploration, for mining, for drilling, for building power plants. Everything was shut down to almost nothing, and that is the way it has stayed.

Speaker John Bohner put a few of the highlights onto a timeline along with gas prices. Cause and effect:

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What about that record amount of oil production? From Tina Korbe:

Energy experts say the president’s rhetoric isn’t exactly forthright. It’s unfair for the president to take credit for record high oil production. Not only does it take oil three to five years to come online, which means the previous administration was responsible for approving the exploration and drilling permits that led to increased production, but oil production on federal lands actually declined from 2010 to 2011. Oil production on private lands is responsible for the increase.

She quotes CNS for the specifics:

As CNSNews.com has reported, oil production on federal lands declined in fiscal year 2011 from fiscal year 2010 by 11 percent, and natural gas production on federal lands dropped by 6 percent during the same timeframe.

In contrast, oil production on private and state lands accounted for the entire increase, reported the IER, as production was up 14 percent from 2010 to 2011. Natural gas also was up 12 percent from 2010 to 2011.

The energy boom from advances in fracking technology are so massive that Obama has not been able to suppress them entirely, but he sure is trying, and we know why. Energy Secretary Stephen Chu was up-front about this as recently as two weeks ago when he testified before the House Appropriations committee:

“Is the overall goal to get our price [of gasoline] down,” Nunnelee began. “No,” interrupted Chu, “the overall goal is to decrease our dependency on oil, to build and strengthen our economy.”

Chu’s goal is less oil consumption, which of course requires higher prices, “to strengthen our economy.” (Note that Chu is a physicist, not an economist.) Chu has been saying for years that:

Somehow we have to figure out how to boost the price of gasoline to the levels in Europe.

That’s $7 to $9 per gallon. Under duress he recanted last week and said that he no longer wants higher prices, but that just stripped away his last remaining virtue, which was his honesty.

Lie number 2: that America is energy poor, so there is not much we can gain by drilling anyway

Someone who knows absolute nothing about anything might find this Obama riff compelling:

There’s a problem with a strategy that only relies on drilling and that is, America uses more than 20 percent of the world’s oil. If we drilled every square inch of this country — so we went to your house and we went to the National Mall and we put up those rigs everywhere — we’d still have only 2 percent of the world’s known oil reserves. Let’s say we miss something — maybe it’s 3 percent instead of 2. We’re using 20; we have 2.

Now, you don’t need to be getting an excellent education at Prince George’s Community College to know that we’ve got a math problem here. (Laughter and applause.) I help out Sasha occasionally with her math homework and I know that if you’ve got 2 and you’ve got 20, there’s a gap. (Laughter.) There’s a gap, right? …

We will not fully be in control of our energy future if our strategy is only to drill for the 2 percent but we still have to buy the 20 percent.

Obama’s 2% figure refers to “proven reserves,” and the smallness of this particular number is actually a measure, not of our resources, but of how little they have been developed. Investors Business Daily explains:

The U.S. has 22.3 billion barrels of proved reserves, a little less than 2% of the entire world’s proved reserves, according to the Energy Information Administration. But as the EIA explains, proved reserves “are a small subset of recoverable resources,” because they only count oil that companies are currently drilling for in existing fields.

We have very little “proved reserves” because we have developed only a small fraction of our resources into active fields. The relevant number to look at is the amount of oil we could produce if it were allowed, and here we are proverbial thousand pound gorilla. Again, from IDB:

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We actually have the world’s largest fossil energy resources, and the “recoverable” part is rapidly expanding as the technology for extracting it advances. Estimates for technically recoverable shale gas reserves increased 134% in 2010, and we’ve hardly begun on shale oil. Then there are methane hydrates, which according to the Department of Energy contain “more energy potential … than all other fossil energy resources combined.”

In short, the United States, and the entire world, have only been tapping the planet’s most easily accessible fossil energy supplies, and even those are far from running out, while vastly larger resources wait in store. Obama’s claims about the impossibility of relying on fossil energy are a fairy tale for childish green adults who want to see themselves as saving the planet. They dream of going “forward” to windmills and absorbing solar radiation like a snake on a rock, yet none of them have enough confidence in the saving-the-planet part to even mention it anymore.

The war on CO2 is over! Tell the EPA!

Obama’s lies about fossil resources are just supporting lies. His big lie is his pretense that his anti-CO2 policies are not about CO2. So take him at face value. He has apparently surrendered his claim that CO2 is dangerous. From his energy-policy speech, it seems that global warming is no longer a motivating concern.

THAT is a big story. Quick, tell the EPA. With this change in the administration’s position there should be no more regulation of CO2 and Obama should rescind his promise to bankrupt the coal industry:

So if somebody wants to build a coal-powered plant, they can. It’s just that it will bankrupt them because they’re going to be charged a huge sum for all that greenhouse gas that’s being emitted.

That war against coal is proceeding apace, every bit as much as Obama’s drive for higher gas prices. And all for nothing, since even Obama is no longer worried about CO2.

At some point—long before we run out of fossil energy—a cheaper source of energy will be developed and fossil fuels will go by the wayside. The only reason to interdict that natural progression and try to go backwards to wind and solar is a belief that fossil fuels imperil the planet. For that to be true, human effects on climate would have to dominate natural effects, a hypothesis that has already been falsified by 15 years of no warming. The only people who believe it at this point are the paid shills of our lavishly funded climate-alarm industry and their anti-capitalist allies. It has actually become unmentionable, which really does warrant some mention.

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235 thoughts on “President no longer worried about CO2: focus on alternative energy is economic says Obama, no mention of climate

  1. That war against coal is proceeding apace,

    Well, once the KKK* finally retired from Congress (thanks to attrition), the West Virginia coal country became a lot less important in electoral politicking.

    *(©1865 Democratic National Committee)

  2. It seemed clear some time ago that Obama had stopped believing in the AGW myth. He has the intelligence and open enough mind to step away from something when the evidence shows it is make-believe.
    Politically he can’t yet say this, of course.

  3. He wants votes, is all. He’s looking ahead to secure the next election. That’s just my point of view, of course.

  4. This analysis is not very convincing. First of all, WUWT readers should understand that estimates coming from models are trumped by actual data. The claims of recoverable reserves are not actually supported by the production data. Yes, the hydrocarbons are there. But to extract them we need to spend energy. In the case of shale, tar sands, and other unconventional sources the amount of hydrocarbon reserves that are economically viable (positive return on the energy invested) is very small. This is why most shale gas producers, who are unquestionable good at getting the gas out of the ground, have serious funding gaps that have to be filled by borrowing and selling off assets. And this is why the actual production of oil has not changed much since 2005 even though hundreds of billions in new investment has helped develop new fields.

  5. Alex is right, there will be a cheaper source of energy long before the end of fossil fuels. For reasons of energy density requirements, that source will be nuclear power.

    But there’s a technology reason as well. We have only deployed the very first generation of nuclear plants after the first demonstration on a laboratory basis of the creating of stable, sustained fission. This means we have barely begun to explore all the ways that useful work can be done by heat extracted from fission. Thus far, we have been extracting heat from hydrocarbons by combustion for about 1,000 centuries. That’s more than enough time to figure out all the secrets of combustion.

    But nuclear is very new. It’s the first truly new fuel source the human race has had in about 100,000 years. So yes, it takes some time to explore all the ways it can be harnessed usefully. And the best part is that the fuel source can last for perhaps millions of years. More than enough to keep humanity’s lights shining for a long, long time.

  6. Harpo says: “It seemed clear some time ago that Obama had stopped believing in the AGW myth. He has the intelligence and open enough mind to step away from something when the evidence shows it is make-believe.Politically he can’t yet say this, of course.”
    Sorry Harpo, Obama is still a warmist, but not for the reasons of CAGW, but for the power and control. Obama is not that smart, he thinks he is because he is suffering from malignant narcissism. The evidence is in his think tanks that tell him that CAGW is no longer a vote winner. Obama is a danger to the American people and the world, he is also the first president of the USA that does not believe in God or even intelligent design; if he admitted this he would have no hope in hell of winning the election. Obama wishes to be president for life.

  7. I don’t understand why we can’t do both. Why can’t we continue to drill for oil while alternative energy sources are being developed. If they pan out and are as economical as oil, there will be no problem getting people to switch. If new green energy technologies remain less economical than oil and gas, then we can switch to them later, after we begin to run out of oil resources and the price becomes less economical. Either way is preferable to what the current US administration is doing. They think they can green the earth by throwing greenbacks out the window. It seems that the companies who receive the largest green subsidies are all headed by Obama cronies, and none of them are ready for prime time.

  8. What’s this “we” stuff, kemosabe ?

    What I want to know is how he can say this stuff with a straight face ? It takes an extraordinary effort simply to keep from bursting out into laughter.

  9. Vangel, your assertions are dated and untenable. Of course it takes energy to extract and refine unconventional hydrocarbons. But that energy is present and abundantly available, as well as very cheap. We cannot blame you for failing to keep up with the developments in energy conversion, because you are much like any other average Joe who believes what he reads, but fails to go the extra mile to discover what is not being reported.

    For those readers who actually want to understand the rest of the story which Alec Rawls omitted above, I suggest following my boss Al Fin’s energy blog, alfin2300.blogspot.com .

  10. …Obama should rescind his promise to bankrupt the coal industry…

    The Left will screech like a scalded owl if he does — it’s about the only promise he’s made that he’s got a chance of keeping.

  11. Harpo says:
    March 19, 2012 at 7:00 pm
    It seemed clear some time ago that Obama had stopped believing in the AGW myth. He has the intelligence and open enough mind to step away from something when the evidence shows it is make-believe.
    ================================================================================
    Do you seriously think that he ever believed in it? Its becoming clearer by the day that global warming/climate change or whatever is nothing more than a smokescreen and excuse for the real agenda for which, in my opinion, Obama is nothing more than a shill –

    http://endoftheamericandream.com/archives/proposed-un-environmental-constitution-for-the-world-would-establish-an-incredibly-repressive-system-of-global-governance

  12. Vangel Vesovski says: “…In the case of shale, tar sands, and…”

    Did you mean “oil sands”, Vangel?

  13. Vangel Vesovski says:
    “The claims of recoverable reserves are not actually supported by the production data.”
    —–
    And the production data is unaffected by moratoriums, revoked permits, or bureaucratic delays, right? Do you think a 6% drop in oil production on federal lands taking place at the same time as a 14% increase on state and private lands is just a coincidence? The drop in production on federal lands has nothing to with bureaucratic stonewalling. That oil just happens to be less recoverable than oil on private lands, right?

  14. Since additional CO2 in the atmosphere has been beneficial, we can use more of it.
    (Forests and crops now grow 10-60% faster than seventy years ago.)
    Higher world wide temperatures have been beneficial in the 11,500 years
    since mankind became ‘civilized.’ (During the medieval warm period, the
    Nordics populated SW Greenland and then left when it got cold.)
    So let’s build more coal burning plants. Let’s find and produce the oil
    we know we have. Let’s really use more natgas..! But do these things
    while capturing the sulfur, NOXs, mercury, and soot.

  15. you bastards don’t know how lucky you are! Try having Julia Gillard lead your country for five minutes. At least Obama is honest about wanting to destroy your economy and dresses it up in pretty words and jokes. Julia Gillard isn’t even fun to watch. Oh, and we have a nation wide ban on nuclear energy, despite having one of the biggest reserves of uranium in the world. Go team!

  16. I am naive on American politics (I’m from Down Under) but I think Obama would have received many favours when running for President from the one world government-save the planet crowd. He OWES a lot of people. Hence, the reason for being President is to pay-back that crowd by damning oil and promoting fairy floss energy, at the same time, knowing that ordinary Americans will be condemned to a lower standard of living.

  17. And, forgive my forgetting them….Let’s
    1…go after more wind and solar. (Let prices determine the amount.)
    2…stop the use of corn for gasoline. (Use it for food)
    3…go after nuclear Generation 3+ (Prices dictate.)
    4…go after nuclear Gen 4; R&D and then Deminstration plants.
    (Lots of money here will pay off.)

  18. Any enterprise or business you do with liars will always fail.
    The prez is very good at seamy “willful deception”.
    Either out of malice or blindness,
    it’s a Big Fail for all of us.

  19. Vangel Vesovski says:
    March 19, 2012 at 7:12 pm

    This analysis is not very convincing. First of all, WUWT readers should understand that estimates coming from models are trumped by actual data. The claims of recoverable reserves are not actually supported by the production data. Yes, the hydrocarbons are there. But to extract them we need to spend energy. In the case of shale, tar sands, and other unconventional sources the amount of hydrocarbon reserves that are economically viable (positive return on the energy invested) is very small……
    =====================================================
    Lol, not really…. “Advances in thermally conductive in-situ conversion may cause shale-derived oil to be competitive with crude oil at prices below $30 per barrel. …..” Continuing, ….“With the exception of the Alberta-Taciuk Processor, no significant development work in surface retorting has occurred for more than 20 years. During this period, major technical advances have occurred in process monitoring and control, process simulation and modeling, chemicals separation and purification, and systems and methods for reducing adverse environmental impacts.” More…… “We assume operating and maintenance costs for first-of-a-kind plants to be between $17 and $23 (2005 dollars) per barrel (OTA, Volume I, 1980; Albulescu and Mazzella, 1987).10 Given these capital and operating cost estimates, we project that the price of low-sulfur, light crude oil, such as West Texas Intermediate, will need to be at least $70 to $95 per barrel for a first-of-a-kind oil shale operation to be profitable.” What’s the price per barrel today? Oh, yeh $108 ….. but, that was just a first gen estimate…… “For initial production costs between $70 and $95 per barrel, experienced-based
    learning could drop those costs to between $35 and $48 per barrel within 12 years of the start of commercial oil shale operations.”
    ……… but all of that was for off-site retorting.

    http://www.rand.org/pubs/monographs/2005/RAND_MG414.pdf

    The money is there, the oil is there, we just have to let it happen. $35/bbl would ~ $1.83/gallon of gasoline.

  20. Hey he is your current president, look where our federal Liberals are now the providers of the Green Shaft/Shift. I think Mr O’s policies are working, if it his intent to destroy the Democratic Party.

  21. Having a 40 yr. background in the petro-chem & oil/gas industry, MS Che, senior process consultant, working in the syn-fuels industry during the energy crisis of the 70’s, we continually face the same problems & arguments over and over. Things haven’t changed much over the past 40 yrs.

    Our current generation is unaware of previous research and solutions involving hydrocarbons or syn-fuels dating back before WW2. The best energy density solution for current electrical production is nuclear fuel sourced, gas & coal being proven, reliable, conventional fall-backs. With current technology, not counting oil production, coal or gas are by far the best backup strategy… both of which can be converted with present technology & processing to any hydrocarbon product that we need.

    I am astonished that today’s young folks don’t realize or much care that almost every product that we use or wear has a direct or indirect hydrocarbon link. A great portion of the chemicals, feed-stocks and products we use and take for granted are all based on processed hydrocarbons. A good analogy of current efforts to decrease our hydrocarbon usage or footprint is to try to minimize our need for or abolish the computer… it just ain’t going to happen… not any more. In fact it is just the opposite…. we continually find more uses for hydrocarbons. In fact carbon is one of the most useful elements that we have been blessed with.

    We do have the technology in hand to process and convert hydrocarbons (solid or liquid) into whatever useful products that we need. But if we continue to demonize hydrocarbons, esp. coal or our supposed large hydrocarbon footprint… we will not survive as a nation or society. You can’t throw away hydrocarbon technology and expect to survive. Wind and solar energy are non-issues when it comes to energy density or reliability, let alone energy storage technology.

    I don’t discount the prospect of new technology…I’m just realistic in my estimation of how long it will take to develop and perfect. Often it will take 30 – 50 yrs to develop alternative energy technologies… only to find them either too expensive or too inefficient compared w/oil & gas. That’s what has happened over the past 40 yrs.

    I am well aware of the ongoing effort to demonize and destroy hydrocarbon based technologies… thereby fundamentally changing and ultimately destroying modern society.

  22. Alec Rawls said in part:
    “For that to be true, human effects on climate would have to dominate
    natural effects, a hypothesis that has already been falsified by 15 years
    of no warming”

    The past 15 years started with a century class El Nino and ended with a
    double dip La Nina. Global temperature trend would be shown more
    accurately with a time period having lack of upward or downward trend in
    ENSO and AMO, such as from the beginning of 1999 to the beginning of
    2012. The linear trend in HadCRUT3 for that period was .044 degree C
    per decade, and that *may* be the actual rate of warming from increase of
    CO2. If it is, then global climate sensitivity to CO2 change is .67 degree C
    per factor of 2 change in CO2.

  23. Vangel claims that for tar sands and oil shale “the positive return on the energy invested is very small,” and that “this is why the actual production of oil has not changed much since 2005.”

    Actually, some of the methods of extraction very promising. Shell’s experiments with in-situ conversion of oil shale into refined and semi-refined products found a quite high rate of energy efficiency:

    ICP requires energy input for heating, freeze wall construction, processing, and maintenance but still generates three to four times as much net energy as it consumes. This energy ratio is very comparable to steam injection in heavy oil projects. [Page 4-22 here.]

    At this rate of conversion, the present estimates of 800 billions bbls of shale oil would yield 600b bbls of oil. Is this what Vangel means by a “very small” return?

    So why has “the actual production of oil has not changed much since 2005″? That’s obvious. The Democrats haven’t allowed development to proceed. George W opened up oil shale leases and permits but before they could come through the pipeline Obama shut them back down. He even shut down research.

    None of which bears one way or the other on the fact that Obama seems to have abandoned the supposed danger of CO2 as a rationale for his energy policies.

    Thanks to Alice for that alfin2300.blogspot.com address. Another fine blog that tracks energy developments is Master Resource.

  24. Obama lies? No kidding. He has always been a liar and a power grabber.He has surrounded himself with cronies like Chu who want to control all of our lives and in the end destroy freedom as we have known it. If he is elected for another term, there may will be an insurrection in this country and it won’t be peaceful.

    As a parting shot, Vangel Vesovski says: “The claims of recoverable reserves are not actually supported by the production data.” Wrong, Wrong, Wrong. Want an example, just look at the relatively quick change in natural gas supplies in the last decade or less.

    If Obozo had started 3 years ago, leasing on federal lands, we would be in a lot better shape to be more in control of oil prices. Why? Stability in crude oil markets is achieved when there is roughly a 1 to 2 million barrel per day “overhang” in supply. When that occurs, there is sufficient market flexibility to cover for minor regional supply disruptions. If there’s a sudden oversupply (or drop in demand), the price can drop sharply because the excess oil must be stored at a cost. Lacking a market, the value of an incremental barrel is low. Conversely, if demand grows by 0.5 to 1 million bbls/day without supply gains, the price can shoot up rapidly. As that market cushion erodes, buyers get nervous and bid up the price. That is where we are now. If Obozo would have had permitted back then( including ANWAR), we would be starting to bring the stuff to market about now. In fact, if he was smart enough to change directions and say so, we would see oil futures drop lie a stone and catch a lot of these speculators in the crossfire.

    I will for for ABO in Nov. I will let you translate ABO.

  25. I’m with Ally E., once he’s got those 4 more years, he, Chu and the EPA will revert to their former modus operandi. I haven’ seen anything so far that makes him believable or honest. The present political rhetoric is just a means to getting another 4, then it’s back to business as usual.

  26. Obama is not to be trusted. He is in election mode and is now playing to the centre so you can be sure he is NOT going to play up to the Warmistas. He is keeping CO2-is-a-pollutant out of the public eye for now ! But he has not thrown it under the bus ! If he is reelected, look out ! His czars will make sure that gasoline is at least $10.00 a gallon by the end of 2016 ! And Dr.Chu will be back with a vengence !!

  27. You know, I found this very interesting, along with some of the contrary commentary. And I have no love at all for the current US administration. Still I’d be happier if commentaries could be freed of the verb “lie” in all its forms. I think they’d stand a better chance of convincing others if they were.

  28. Donald Klipstein suggests:

    The past 15 years started with a century class El Nino and ended with a double dip La Nina. Global temperature trend would be shown more
    accurately with a time period having lack of upward or downward trend in
    ENSO and AMO.

    How about comparing the peaks of two big El Ninos: 1998 and 2010? Same temperature. No warming.

  29. Donald L Klipstein says:
    March 19, 2012 at 8:26 pm

    The past 15 years started with a century class El Nino and ended with a double dip La Nina. Global temperature trend would be shown more accurately with a time period having lack of upward or downward trend in ENSO and AMO, such as from the beginning of 1999…….
    ==========================================================
    Puh-lees……that went directly into a double dip La Nina right after your better start point…… if you’re going to pretend to be reasonable, pretend better. 2001 would be a better start point, because it was a fairly neutral year and while 2002 had an El Nino, it wasn’t as strong. ……. funny

  30. I am glad Mr Obama won’t mention his CO2 doubts out loud. If he were to make a definitive statement that CO2 wasn’t bad, I would have to go look at what Armageddon was about to befall us all from CO2. Pretty much whatever Mr. Obama says I look for the deception, because the guy hasn’t played it straight with anyone yet. I am not even sure he knows when he is prevaricating.

  31. Fay at Fingal Head,
    I don’t think you’re naive at all. Thing is, SpaghettiO’s potential replacement is probably paddling the same canoe.

    Green donors bet on Mitt Romney flip-flop – Darren Samuelsohn – POLITICO.com

    http://www.politico.com/news/stories/0312/73642_Page2.html

    As Romney shows, politics makes strange bedfellows | Campaign 2012 | Washington Examiner

    http://campaign2012.washingtonexaminer.com/article/romney-shows-politics-makes-strange-bedfellows/353561

    Increasing taxes, capping greenhouse gasses, legalizing gay marriage, and backing Hillary Clinton for president — these are the recent political and policy priorities of Mitt Romney’s very biggest financial backers.

    While Romney’s Florida victory spurs talk of inevitability, exit polls show him still struggling among conservatives and Tea Partiers. Campaign finance reports filed this week reveal a gulf between the GOP base and Romney’s funding base.

    Financiers Julian Robertson, Paul Singer, and Miguel Fernandez all gave $1 million to Romney’s shadow campaign — Restore Our Future, the super-PAC supporting Mitt Romney and run by former Romney aides

    Robertson also has a big-government environmentalist streak. He sits on the board of the Environmental Defense Fund, and he has hired K Street lobbyists (including now-Sen. Dan Coats, R-Ind.) to advance the Warner-Lieberman bill that would have capped industrial emissions of greenhouse gasses — in effect a tax on burning coal and oil.

    Hedge fund millionaire Paul Singer also gave Romney’s super-PAC $1 million in November. Singer’s Elliot Management is politically out of step with its industry: In the 2008 and 2010 elections, while the rest of the industry was giving about 68 percent of its money to Democrats, Singer’s firm was giving about 98 percent to Republicans.

    Singer spent a good part of 2011 rallying other Republican financial moguls in an attempt to recruit New Jersey Gov. Chris Christie to run for president.

    But Singer’s biggest cause in 2011 was not partisan — he spent $1 million lobbying to legalize gay marriage in New York state. That puts Singer not only far to the left of the GOP base and Romney, but also to the left of President Obama, who publicly opposes gay marriage. Singer’s son married a man in Massachusetts.

    Miguel Fernandez of Miami has succeeded in health-care investing in recent years, and last July he gave $1 million to Restore Our Future —half from his own pocket, and half from an account of his called MBF Family Investments.

    While Romney publicly denies he’s a liberal Republican, he apparently hasn’t convinced Fernandez of this. Before giving $1 million to Romney’s super-PAC, Fernandez split much of his money between Democrats and liberal Republicans who faced conservative opponents…

  32. NW says, “Still I’d be happier if commentaries could be freed of the verb “lie” in all its forms.”

    Ah, how about Fraud, Scoundrel, Wastrel, Traitor, Fool, Coward, instead of lie or liar? All = Obama

  33. I’ll take the alternate energy crowd seriously when they propose daming Niagara falls and the Niagara gorge.

    Currently the Niagara Falls generating capacity is 5 million kilowatts that’s 2 or 3 large coal. generating plants. Niagara falls power generation could be at least doubled and probably tripled fairly easily. That would eliminated the need for 2 to 5 coal generating plants or all the windmills currently in operation.

    It would also be cheap electricity.

  34. Harpo says:
    March 19, 2012 at 7:00 pm

    It seemed clear some time ago that Obama had stopped believing in the AGW myth.

    Whether or not our own dear SCOAMF believes that the globe is warming, whether or not he believes this is caused by CO2, & whether or not he believes that burning “fossil” fuels has caused any appreciable increase in atmospheric CO2 are entirely beside the point. If pressed upon the point, I would venture that most Yale men would admit that their school is no better than Cornell or UNLV in any objective test, but that won’t stop them from playing their games with oblate spheroids in the intent of scoring more points.

  35. Vangel Vesovski says:
    March 19, 2012 at 7:12 pm
    [snip] And this is why the actual production of oil has not changed much since 2005 even though hundreds of billions in new investment has helped develop new fields.
    ——
    The Alberta government disagrees with you:
    “New projects are being added every year and production is expected to increase from 1.31 million barrels per day in 2008 to 3 million barrels per day in 2018…”

    http://www.energy.alberta.ca/OurBusiness/oilsands.asp

    Also, there is a big difference with energy used for transportation and energy use for stationary generation and use. For example, a lot of energy is lost when converting it into a battery or hydrogen fuel storage system for transportation, while the lost energy used to extract fuels for transportation use is made up for in its greater density of energy storage and less waste energy compared to non fossil fuel methods. In other words, it would be worthwhile to use hydro generated energy to increase fossil fuel extraction and recovery than to use it for electrically powered transportation. Airlines won’t be flying using batteries as their power source any time soon.

  36. Hey guys! Isn’t it great to see that the Administration already is coming off its CAGW stance? I predicted this at least two years ago. Mr. Obama should be welcomed to the fold, not reviled as a liar. He is a politician standing for reelection for crying out loud. Of course he is going to back away gracefully.

    The Obama Administration has slowed down the permitting process after the Deepwater Horizon disaster, but that doesn’t seem entirely out of line to me. That was a bad one, and to take a little time to reconsider safety measures and slow down the permitting process was not a bad idea. This does not mean that no permits have been issued by the way—far from it. A little south of fifty permits have been issued. The same goes for the Keystone XL pipeline. It was pushed through far too quickly. 60 days to approve it? Come on, that’s irresponsible. Ask Nebraska Governor David Heinemann (R), or Senator Mike Johanns (R-Nebraska). They are against it, and they hardly qualify as your bleeding-heart liberals.

    And if Mr. Boehner wants to convince someone that world oil prices are tied to U.S. production, he needs to take his story a little farther into the countryside. Any sentient being knows that oil is a world commodity, and the world market sets the oil price—period. Demand from China and India has everything to do with oil prices, ANWR or Keystone XL very little. Those are the facts.

    If you are looking for politicians curtsying to a frothy-mouthed base, please tune in to Romney, Santorum, et al. But perhaps they want soon-to be outlawed condoms for oil transportation.

    Climate skepticism can always use converts. When a slow conversion is happening in the White House, I think the right idea is to say hail and well met, not to get one’s undies in a bundle.

  37. Philip Bradley says:
    March 19, 2012 at 9:26 pm
    I’ll take the alternate energy crowd seriously when they propose daming Niagara falls and the Niagara gorge…. It would also be cheap electricity.
    —————————————————————————-

    We would have to contract the Chinese to build it. They have current know how.
    Everyone who knew how to build one in the USA is dead.
    Now you know why we call them moratoriums.
    It’s happening to steel too….and…and…and…and…etc.

    Wow the “BO” speaks and I flip mega negative.
    bummer. Hurry up november.

  38. ElmerF says at 8:29 PM:

    [SNIP: This really is too far. Drop it. -REP]

    Chill out, Elmer. You’ll live.

  39. Reminds me of Obama’s campaign in Florida.
    In 2007, he first talked about delaying the space program. “The early education plan will be paid for by delaying the NASA Constellation Program for five years…”

    When he learned he could lose Florida, he “changed” and loved the Space Programs with his first Space Policy speech in August 2008. “He endorses the goal of sending human missions to the Moon by 2020, as a precursor in an orderly progression to missions to more distant destinations, including Mars”

    In 2010, he cancelled the Constellation Space program.

  40. “We announced our support for a new one in Oklahoma that will help get more oil down to refineries on the Gulf Coast.”

    This is the lower part of the Keystone XL pipeline

  41. Thanks for a comprehensive presentation of the energy/political landscape. It would appear that the current administration is intent on strapping the American public with ruinous energy prices regardless of a factual record that indicates such draconian measures are unnecessary. One can only ponder the question: “why”?

  42. I’ve been snipped! FINALLY I said something that went too far. I’m a new man!

    [REPLY: Congratulations. In my commenter persona I've been snipped numerous times. Welcome to the club. But please, even in jest, that stuff is not getting through. Thank you for your good humor and understanding. -REP]

  43. Combustible carbon is a finite resource. Perhaps there is enough combustible carbon in the Earth’s crust to convert all the oxygen in the atmosphere to CO2, but I doubt that it could be easily extracted for that purpose. With tar-sands and oil shale, the problem is Energy Return on Energy Invested, (EREOI) that is the energy left over after energy has been expended in its extraction. There is a big difference in the amount of energy recovered from a gushing oil well and that which remains after cooking a barrel of oil out of tar sands. That ‘cooked’ oil may just end up being too expensive for the common man.

    I find the statistic that we are now producing six times as much petroleum as we are finding new to be an inescapable indication that we have used a major fraction of the Earth’s affordable petroleum. Perhaps this is not half as some fear, but enough so we can no longer double production on the same periodic basis as before. I expect that the main impact of this will begin one or two generations down the line.

    Some have said that the sub-prime mortgage crisis was caused by the failure to double petroleum production, as these loans were issued assuming a growth rate that depended on ever-expanding production.

    While some are pushing for advanced green energy harvesting for future energy needs, I believe that these green or natural energy projects are nothing but a shortcut return to the stone-age lifestyle predicted by the ‘Olduvai Theory,’ as most advanced techniques of this type depend on diminishing resources or products of the petroleum industry.

    So far, I see no viable working, next generation, alternative energy production scheme now in use that does any more than hold the wolf at bay for a few centuries. Safe thorium nuclear and fusion power seem to be promising; however, no practical power plant has ever been constructed using these techniques. In the case of thorium nuclear, this seems to be the result of a political decision to halt this effort without ever seriously trying to make it work. There has been no lack of effort to develop a fusion power process.

    Based on the time it took steam to replace sail for ships, it may take forty years before a pilot plant for a new energy technology is replicated to general use.

    As a reference, the 35-minute YouTube video cartoon with the alarming title: “There’s No Tomorrow” seems to be the best quick comprehensive presentation of the ‘Peak Oil’ theory I have seen. It also explains why growth cannot keep doubling on a finite planet. As for ‘Peak Oil,’ the only question appears to be ‘when’ it will happen. (I do suspect that some of the support for these ‘Peak Oil’ videos comes from precious metal investment groups.)

    “There’s No Tomorrow,” Peak Oil Documentary

  44. In the early days of the 2008 campaign, then Sen. Obama was cosponsor of a bill that promoted the conversion of coal to liquid fuel. As it became apparent that his momentum was building, he quietly withdrew his name from the bill. He may be a watermelon, but his rind is paper thin.

  45. Torgeir Hansson says:
    March 19, 2012 at 9:39 pm
    “Hey guys! Isn’t it great to see that the Administration already is coming off its CAGW stance? I predicted this at least two years ago. Mr. Obama should be welcomed to the fold, not reviled as a liar. He is a politician standing for reelection for crying out loud. Of course he is going to back away gracefully.”

    Why did he block the Keystone XL pipeline, then? His employee Hansen keeps on saying that if all oil sands are used it’s game over for the climate. This doesn’t make sense.

  46. Spector says:
    March 19, 2012 at 10:11 pm
    ““There’s No Tomorrow,” Peak Oil Documentary”

    They show a lot of graphs in that film.

    None of the graphs has numbers on the y scale.

    It’s a propaganda film. They pretend to have data when they have none.

    If they had data, they could put numbers on the scales.

  47. Torgeir Hansson says:
    March 19, 2012 at 9:39 pm

    blather, blather, bs……..
    The same goes for the Keystone XL pipeline. It was pushed through far too quickly. 60 days to approve it? Come on, that’s irresponsible…….blather, blather, bs ……
    ==================================================
    Lmao….. who do you think you’re addressing? Some adolescent green mushheads willing to believe everything they’re told?

    The fact is the state dept. had studied it for 3 years and was going to approve it, when the administration took the authority from the state dept. And, it was then Obama declared he was going to dither about it, likely until after the election. A few months later is when the law was passed giving him 60 more days to make a decision.

    The prices are tied to the speculative nature of the business. The supply and demand are just fine. It’s the jitters from having much of our supply coming from an unstable part of the world. North America has enough oil to become oil independent. The U.S. is the largest consumer of oil. You guys and gals really need to quit pretending we don’t have it within our power to significantly effect oil prices. Combined with shale oil we’re sitting on over a trillion barrels of oil. More than anyone else.

    So, now I have a question. Are you misguided or are you intentionally misleading people? BTW, your idiotic blathering about condoms is another complete and utter falsehood. Typical leftist.

  48. lol, Malthusians are out and about tonight. Peak oil!!! Dear God, do you people listen to yourselves? Read up ….. heck read the damned post. We’re not out of oil, we’ve got plenty of oil, well enough to last us centuries. And, much of the world’s reliance on it will be diminished by the nat gas that we’ve found.

    Read geologists and economists. Read something other than your dystopian fantasies.

  49. Fact is no need for subsidy or direction, economics rules.

    Example, a 500,000 bbl train to produce oil sands in Canada cost, I believe, usd 4 billion. At the time, the price of oil was 150 per barrel. Thats 75 million per day or 2.25 billion per month. Thus the whole process train paid for itself in 60 days. Thus real cost, is just the daily cost of operation. Same applies to frakking. Price estimates always ignore the real world.

    The fudge factor, is how they choose to write off the start up cost.

  50. When the Spanish Portola Expedition discovered the Los Angeles valley in 1769 they were amazed at the 350F black geysers at the La Brea (Spanish for tar) tar pits. This super-heated discharge continued until drilling of oil wells at Long Beach in the early 1900’s. Hydrocarbons are a natural by-product of fission prduced ‘elemental’ atoms under high temperature and high pressure which form ‘elemental’ molecules and eventually elemental compounds. This is described in “Fossil Fuel is Nuclear Waste”. Speaking of waste….there’s no free lunch in the eco-energy market either. Solar cells work by molecular erosion, a one-time, one-way flow of direct current that creates less energy than reqired for production. Photovoltaic, like bio-fuels are a net energy loser. For more on this read “Green Prince of Darkness”. Those who would lie about your mothers warm breath on your baby face being a toxin….will lie about everything. There are six times the proven reserves of Methane Hydrate in tundra and ten times the proven reserves of Methane Calthrates at the ocean floor. Find and share Truth.

  51. Spector says:
    March 19, 2012 at 10:11 pm

    ………… With tar-sands and oil shale, the problem is Energy Return on Energy Invested, (EREOI) that is the energy left over after energy has been expended in its extraction.
    =========================================================
    Gee, I wonder if the Canadians have figured that out? Maybe you should call them and impart your wisdom to them. Them poor bastards probably have never heard of that before!!! Turns out, our technology has advanced since the days of poking holes in the ground and hoping oil comes out.
    Here, read this …… I don’t entirely agree with the guy, but, he also knows we’re not running out anytime soon……. http://www.europeanenergyreview.eu/site/pagina.php?id=3316
    Here’s the take away…..

    Second — the ultimate physical sufficiency of global oil and gas resources is not in doubt so that one can ignore the present-day Jeremiahs. Their predecessors in the 1960s, the 1970s and the 1980s were all quickly proved wrong and a similar fate will overcome the so-called “peak oilers” by the end of the present decade. Any under-achievement in future oil and gas production will be the result of a combination of organizational, economic, political and environmental fac¬tors, all of which can be overcome, as they always have been in the past — except for very short-term lapses.

  52. DirkH says:
    March 19, 2012 at 10:17 pm

    “Why did he block the Keystone XL pipeline, then?’

    He blocked it because the approval period was way too short, as was the stated reason. It takes a little longer than sixty days to work out the kinks in a proposal of that magnitude.

    I don’t think Mr. Hansen makes any sense either, but that doesn’t change the fact that a major pipeline project needs a reasonable time for approval. The Republican Governor of Nebraska agrees with this.

  53. Claude Harvey says:
    March 19, 2012 at 10:06 pm
    ” It would appear that the current administration is intent on strapping the American public with ruinous energy prices regardless of a factual record that indicates such draconian measures are unnecessary. One can only ponder the question: ‘why?'”

    We have already covered the fact that new domestic oil production is not going to alleviate “ruinous energy prices,” especially when they are at about half of what Europeans pay.

    As far as such “draconian measures” being “unnecessary”: oil production is not a trifling matter, as a matter of fact is often a rather massive undertaking. There are environmental impacts, and it is prudent and appropriate to consider them before permits are issued. Sorry to break the news to you, but this is not Pennsylvania in the 1860s. Let it be mentioned that a country like Norway produces plenty of oil and gas, but the permitting process is far more stringent than in the U.S.

    It is not an either-or.

  54. “For that to be true, human effects on climate would have to dominate natural effects, a hypothesis that has already been falsified by 15 years of no warming. The only people who believe it at this point are the paid shills of our lavishly funded climate-alarm industry and their anti-capitalist allies. It has actually become unmentionable, which really does warrant some mention.”

    Succinctly put Mr Rawls….. and it is a message that the voters are becoming more and more informed about.

  55. Torgeir says:

    Climate skepticism can always use converts. When a slow conversion is happening in the White House, I think the right idea is to say hail and well met, not to get one’s undies in a bundle.

    Obama is not a convert. He’s a liar. When he pretends that his long-professed anti-CO2 policies have nothing to do with CO2, he is not telling the truth. But you just keep smoothing your panties Torgeir. Whatever makes you feel good.

  56. Owen in Ga says (March 19, 2012 at 9:01 pm): “Pretty much whatever Mr. Obama says I look for the deception, because the guy hasn’t played it straight with anyone yet. I am not even sure he knows when he is prevaricating.”

    Well I know when Obama’s lying:

    His lips move.

    (Oh come on, somebody had to say it!)

    [Moderator's Note: This comment is acceptable. Please remember, however, that we are talking about the President of the United States and there are some lines that will not be crossed. Please exercise... shall we say, discretion? in comments. Thank you for your cooperation. -REP]

  57. Keystone will be approved right after the election, and Obama strongly supports the new pipeline to move Canadian oil while Keystone gets built.

    Also, why can’t we take winning for an answer? Global warming is scientifically invalid and we need to accept we won the argument and quit vilifying the other side for actual agreement with us.

    Ummm, and BTW, we do need alternative energy sources, oil won’t last forever and we need to leave some for future generations to use for making plastics and the like instead of burning it all.

  58. As for Hansen, I will be amazed if he holds his job after the election, the issue for Obama is if he moves Hansen now the left will go insane before the election.

  59. James Sexton says:
    March 19, 2012 at 10:26 pm
    blather, blather, bs….
    You guys and gals really need to quit pretending we don’t have it within our power to significantly effect oil prices. Combined with shale oil we’re sitting on over a trillion barrels of oil. More than anyone else.
    blather, blather, bs…
    So, now I have a question. Are you misguided or are you intentionally misleading people? BTW, your idiotic blathering about condoms is another complete and utter falsehood. Typical leftist.
    End of blather, blather, bs…
    —————
    Dear Mr. Sexton:
    You have a commendable mastery of argument. Belittle, belittle some more, for then to make an utterly untenable argument. Mr. Sexton, oil is a world commodity. Do you for a second believe that an American oil company will sell at a discount to Americans, if wholesale prices dictate otherwise? Don’t you get it? World demand sets oil prices, period. Chevron, Exxon, Shell and the rest are in business to maximize profits, and they do it by applying the parachute principle: gasoline prices rise quickly, and come down slowly. You can mutter until you are blue in the face, but that is the unalterable fact.

    Do I agree that the issue is politically sensitive for Obama? Absolutely. Fine, let him approve it in his second term, which he is sure to get, due to the insufficiency of the alternatives. No big loss. It will be built, and possibly with a new route through the Sand Hills region in Nebraska, and farther away from the Ogallala aquifer, so that Republican Governor David Heinemann can get on board.

    And do I really believe that Rick Santorum wants to use condoms for oil transportation? Yes, I really, really do, you typical dyspeptic. And don’t saddle me with Mr. Hansen’s “game over” fantasies either. I believe that as much as you do.

  60. Alec Rawls says:
    March 19, 2012 at 11:12 pm
    “Obama is not a convert. He’s a liar. When he pretends that his long-professed anti-CO2 policies have nothing to do with CO2, he is not telling the truth. But you just keep smoothing your panties Torgeir. Whatever makes you feel good.”

    Dear Mr. Rawls:
    Governments lie. Get used to it.

    What I find remarkable is that if you can’t see that the Obama Administration backing off its CAGW views has major benefits, your mind is clouded with too much protest.

    That’s a win, Alec. Take it, and save your disparagement for a better occasion.

  61. RE: DirkH: (March 19, 2012 at 10:20 pm)
    REF: “There’s No Tomorrow”
    “They show a lot of graphs in that film. None of the graphs has numbers on the y scale.
    It’s a propaganda film. They pretend to have data when they have none. If they had data, they could put numbers on the scales”

    .
    Yes, like most presentations of this type, it is propaganda, however, even David Archibald presented a graph showing that the rate of oil extraction (production) was exceeding the rate of new oil being found by a large margin. I take this as an indication that we should be looking to develop a new sustainable high-density energy resource, as I do not believe that natural energy will ever support anything like our current population level.

  62. peak oil is not about “running out of oil.” it’s about running out of cheap, affordable oil. and we’re already there, otherwise, why would the price of oil have doubled — twice — in just the last decade? saudi arabia, once the world’s swing producer, is pretty much producing a maximum right now, and regardless of all the shale/tar sands oil & gas we can produce in the u.s and canada, we are still very close to a deficit in liquid fuels. the best estimates by the u.s. military and iea and other respected monitors of world oil supply indicate that we will be off the 8-year plateau of hubbert’s peak that the world’s been on within another year or 2 or 3 — then world oil supply will rapidly go into a tailspin, with dramatic gasoline price increases and, in the not too distant future, actual shortages at the pump. i am flabbergasted to see such uninformed and completely unsophisticated opinion about the reality of peak oil among such an otherwise erudite crowd as frequents WUWT. suggest a trip to theoildrum.com, and, additionally listen to a few interviews (on youtube) with the highly respected oil analyst dr. robert hirsch, author of the 2005 “hirsch report,” which was commissioned by the u.s. gov’t and then suppressed. i found “there’s no tomorrow” to be an excellent film — even with the unenumerated y axes.

  63. Torgeir Hansson says:
    March 19, 2012 at 11:33 pm

    Dear Mr. Sexton:
    You have a commendable mastery of argument. Belittle, belittle some more, for then to make an utterly untenable argument. Mr. Sexton, oil is a world commodity. Do you for a second believe that an American oil company will sell at a discount to Americans, if wholesale prices dictate otherwise? Don’t you get it? World demand sets oil prices, period. Chevron, Exxon, Shell and the rest are in business to maximize profits, and they do it by applying the parachute principle: gasoline prices rise quickly, and come down slowly. You can mutter until you are blue in the face, but that is the unalterable fact……..

    ==================================================
    Look, I won’t belittle if you don’t intentionally try to deceive people. And, if you want to make snide off-topic political commentary, then you better be ready for some snide comments back. It turns out, I know of a blog that would be happy to have your idiotic talking point about trying to force uninvolved parties pay for others sexual habits to discuss. http://suyts.wordpress.com

    Yes, I understand oil is a global commodity. I thought I made that clear with my statements about reserves and consumption, but instead of implying, I’ll be explicit.

    The U.S. has enough reserves of normal crude and shale oil to out produce any other nation in the world, so much so as to have a large surplus even as the world’s largest oil consumers. Do you believe 30% of the global market in both consumption and production isn’t sufficient to alter the price?

    Continuing, this isn’t Europe we’re talking about. Their cost is of their own making. There’s no reason for it to be that expensive other than governmental interference.

    And, the current price of oil and gasoline has absolutely nothing to do with the current supply or demand. The production/consumption/reserves is essentially the same as when the price was $40-$50 a barrel. The reason for the price spike is twofold, one, they’re worried about the stability of source of oil ….. the Mideast, and secondly they’re worried about the lack of increasing capacity. As economies grow, more oil is needed, meaning the capacity has to expand. The U.S.’s unwillingness to significantly do this or even give impetus to Canada to do so has and will continue to adversely effect the price of oil.

    By simply making a noticeable commitment to expanding production capacity from stable nations would dramatically drop the price of oil today.

  64. p.s. i’ve long been a great admirer of mr. watts, and this blog, and agree wholeheartedly with the thesis that co2-caused AGW is complete bunk. but it’s distressing to see the same highly discerning skeptics regarding agw react in such kneejerk fashion to a problem that is all to real, and has already bitten us ($147/barrel oil directly precipitated the 2008 financial crash) and, like a boa constrictor, will continue to tighten around the world economy for the foreseeable future, with predictably dire consequences. as far as oil prices are concerned, notice that each spike in oil prices is followed by a financial crash, ensuing demand destruction, which then temporarily lowers the price of oil … which then creeps back up again. and these cycles are getting closer and closer together. suggest some more research before dismissing the reality of peak oil. no matter how much we “drill baby drill” in the u.s. and offshore, we’ll never come anywhere close to meeting our current domestic needs for liquid fuels without lots imported oil. also, as the oil exporting countries continue to siphon more and more of their oil to quell domestic demand, there’ll be less and less available for export. china and india alone will be absorning much of this exported oil anyway.

    peak oil is real, and may be the most serious problem the advanced industrial world faces for the foreseeable future.

  65. Torgeir: Obama’s unwillingness to mention climate is only a win if it can be exposed, which is what I am trying to do. Yet you are against this “belittling.” I don’t think you are being consistent.

  66. ” If we drilled every square inch of this country — so we went to your house and we went to the National Mall and we put up those rigs everywhere — we’d still have only 2 percent of the world’s known oil reserves.”

    The operative word is ‘known’. Whenever there is a desire to limit the supplies available the reserve is reduced to what is ‘known’ (proven etc). Whenever there is a desire to inflate the amount they are termed ‘reserves’ or ‘disciveries’ or ‘estimated’. Both sides place this game: those who pretend we are running out and those who pretend they know there will be more.

    As abiotic oil exploration is only seriously practised in Russia where 50% of current exports are from ‘non-fossil sources’ it is very unclear what anyone’s ‘known oil reserves’ are because we have not even started looking properly yet.

    Whatever you dear readers think about the tussles over energy that must be going on behind the scenes in the Office of the President, one this is obvious to us ‘furriners': the USA has started looking for energy a lot closer to home and stopped grabbing derricks in foreign lands. That is credited to the President, like it or not, true or not, just as the previous acquisitive behaviour is rightly or wrongly attributed to the previous one. Stop dissing your own CIC.

    One more thing, the chart of reserves is laughable as a picture of available energy. Africa is barely explored and it seems every time someone trips over a mango tree root, oil pops up. Keep your eye on the Congo basin.

  67. Alec Rawls says:
    March 20, 2012 at 12:20 am
    “Torgeir: Obama’s unwillingness to mention climate is only a win if it can be exposed, which is what I am trying to do. Yet you are against this “belittling.” I don’t think you are being consistent.”
    —————–
    Dear Alec:

    I think it is great to analyze Obama’s statements, and expose the shift in attitude that is in evidence. I find the name-calling unhelpful. This Administration is presenting its current thinking in the best possible light, like any other Administration would. I am not so sure this shift needs to be “exposed” as much as it needs to be highlighted. They are coming around, for heaven’s sake.

  68. Tiger Woods Leg says:
    March 19, 2012 at 11:28 pm

    Keystone will be approved right after the election, and Obama strongly supports the new pipeline to move Canadian oil while Keystone gets built.

    Also, why can’t we take winning for an answer? Global warming is scientifically invalid and we need to accept we won the argument and quit vilifying the other side for actual agreement with us.

    What makes you believe all of this? Saying Hansen will get fired and all of that seems suspect. I wouldn’t be shocked to see the Keystone approved even if he gets re e-elected, but outside of that it’s hard to believe the rest of what you’re saying.

  69. RE: James Sexton says: (March 19, 2012 at 10:55 pm)

    “Turns out, our technology has advanced since the days of poking holes in the ground and hoping oil comes out.”

    The point is that all the extra processing takes energy. That is why we/they have never exploited these resources before. This is an indication that we have used up all the good stuff that was easy to get and now we are forced to use more energy to get what’s left. Thus oil in the ground is not the same as oil in the truck because some of that oil in the ground had to be used, figuratively, to power the process of extraction. That is what is meant by EROEI. It’s like a tax levied by nature on petroleum trapped in sand, shale or mud. We may have a few centuries left, but after that according to the Olduvai Theory, its back to the stone age unless we develop a new primary energy source.

  70. Dear Mr. Sexton:
    I understand that the U.S. has reserves to outproduce any other country in the world.

    Yet U.S. oil production has fallen most years since 1980. During the Bush II Administration it fell every year. EVERY year, under the tutelage of the Arbusto President. The first sharp upticks in production happened in 2009 and 2010. Those were Obama years, but I am willing to accept the notion that these increases happened due to decisions made towards the end of the Bush Administration, although it would be nice to see confirmation for it.

    As a matter of fact we only saw an increase in U.S. oil production in 7 out of 30 years in the period between 1980 and 2010. This was a time when Republicans controlled government for 18 out of 30 years. During the Reagan Administration U.S. oil production fell for 5 out of 8 years.

    It seems to me that this data shows that U.S. oil production does not depend on which party occupies the White House or Congress.

    What is your explanation for the decline in production? I understand that new technology may have altered the picture, but we can’t forget that there are political and environmental considerations in the picture as well.

  71. SAS writes:

    it’s distressing to see the same highly discerning skeptics regarding agw react in such kneejerk fashion to a problem that is all to real, and has already bitten us ($147/barrel oil directly precipitated the 2008 financial crash) and, like a boa constrictor, will continue to tighten around the world economy for the foreseeable future

    What causes the oil price spikes is our failure to develop our fossil resources. In particular, when we leave supply in the hands of a cartel, they are going to periodically succeed in getting their cartel act together, restricting supply and raising prices.

    We could easily produce enough oil to bust up their cartel action. Just keep the price low enough to where the kingdoms and dictatorships have to sell MORE to pay their bills and they will unravel, allowing us to pump them dry for pittance a barrel. Then we can be done with them, while still enjoying our own plentiful supplies.

  72. So called Oil Markets are a financial casino not a true market. The prices set have nothing to do with cost of production, supply or demand. That is why we have silly prices.

    If Oil “contracts” consisted of real oil that had to be collected, you would see prices tumble.

  73. One more thing, Mr. Sexton:
    European governments tax oil to regulate behavior, just like we tax cigarettes to regulate behavior. Same thing.

  74. Torgeir: On what do you imagine Obama to be “coming around”? His speech was a justification for NOT expanding development of our fossil resources (drilling won’t solve anything he insists), while calling for continued efforts to switch to alternative energy. He explicitly calls for more subsidies for more alternative energy projects. More Solyndras, more Fiskers. You seem to want to give him credit for his deceptions, his pretense that his anti-CO2 policies are motivated by economics. Sorry, but deception is a negative, not a positive.

  75. Torgeir Hansson says:

    “European governments tax oil to regulate behavior, just like we tax cigarettes to regulate behavior. Same thing.”

    Yes, same thing, Mr Hansson: for MONEY. But regulating behavior has nothing to do with it; that’s just the cover story. Political greed is the motive.

    Governments don’t give a damn about people, except insofar as people are taxpayers. Oil is taxed for MONEY, and cigarettes are taxed for MONEY.

    Governments are as addicted to tobacco money as a heroin addict is hooked on heroin. If governments wanted to protect the health of taxpayers, they would simply outlaw cigarettes completely. But they don’t: that would cut off their tax MONEY.

    The Obama Administration has reduced oil drilling and exploration far more than any previous administration because Obama is in thrall to the anti-American eco-nazi cult. President Bush handed Obama a gasoline price of only $1.89 a gallon… and Obama blew it, big time. That’s what happens when you’re dancing to the tune called by the self-serving eco crowd. Obama is just a stooge of the anti-human enviro cult.

  76. Torgeir Hansson says:
    March 19, 2012 at 11:42 pm

    “Governments lie. Get used to it.”

    Au contraire, Mr. Hansson. This is not “government” lying. This is a candidate for political office in the United States this year. Barack the Usurper’s own government has put plenty of facts out there to contradict the bald-faced lies he has been telling. So this is quite foolish of you to be insulting the intelligence of the rest of us with dismissive statements like yours.

    Bottom line: with the current price of a barrel of oil, it is now easier to develop new resources that were more expensive to reach. If this government will stay the heck out of the way and quit revoking and denying more drilling permits on federal lands, this will, eventually, increase the supply of oil to the point where gas prices can come down. It has been proven with natural gas in this country. If the Democratic Party in this country hadn’t spent as much time halting exploration efforts in this country for the last 40 years, we would not be talking about gasoline prices here like we are now. As James Sexton also said, Europe has its own problems, most of them of their own making, so please stifle the urge to sound ridiculous.

  77. Torgeir Hansson says:
    March 20, 2012 at 1:01 am

    You either live in another country or you haven’t been paying attention to what has been going on in this country for the past 40 years or so. It HAS mattered which party has been in power; it has also mattered how much influence the environmental lobbyists have had for years both within EPA and the Department of the Interior. I will give you the benefit of the doubt that you live in another country. Otherwise, it is more proof of your inability to see reality.

  78. Hello Alec:

    What Obama is saying is that drilling in the U.S. will not solve the short-term price issue at the pump. And he’s right. We do need more alternative sources, such as nuclear, wind, and solar, and everything else we can come up with—biofuels from pig manure and all the rest of it. We need to use all available resources to succeed.

    I will have to take issue with the notion that the Obama Administration is out to deceive everybody. They are trying to solve the issues that are facing us, based on the best information available, just as I believe the Bush Administration tried to do the same, and every Administration before it. I will not follow you into the assumption that this Administration is out to ruin the country. That is a toxic notion.

  79. Hello Larry:

    I stopped reading at “Barack The Usurper.”

    Take your atavistic attitudes somewhere else.

  80. Torgeir Hansson says:
    March 20, 2012 at 1:07 am

    Taxing behavior usually ends up creating unforeseen consequences that defeat overall policy on a particular subject. I’ve never been a big advocate of taxing to regulate people’s behavior, unlike you. We’ve been taxing gasoline in this country for years; about one-third to one-half of the price of gas at the pump is gasoline taxes, depending upon what state you are in. And yeah, it has an effect – in Texas, for example, gas tax revenue has gone down in recent years, and has created a budget crunch for highway construction and maintenance. Like it or not, people will drive and have to drive. It does little good to cut your nose off to spite your face.

    Now, Europeans may be desperate with respect to oil, because they are “regulating behavior” in spite of the fact that they have mass transit systems that are far more comprehensive than those in the United States. Maybe THEY should try finding more oil in their own backyards.

  81. Dear Smokey:
    Governments need money to function. You may not like it, but governments are the agents of the people. Both driving and smoking cost money to society, as there are cheaper alternatives. Governments are completely in their right to institute such policies, and defend them in elections. If people agree, these governments are given a new lease on power. If not, they are voted out. That’s still the way it works last time I checked.

  82. Torgeir Hansson says:
    March 19, 2012 at 9:39 pm
    The Obama Administration has slowed down the permitting process after the Deepwater Horizon disaster, but that doesn’t seem entirely out of line to me. That was a bad one, and to take a little time to reconsider safety measures and slow down the permitting process was not a bad idea.

    He didn’t slow the process down, he called it to a complete halt.

    This does not mean that no permits have been issued by the way—far from it. A little south of fifty permits have been issued.

    You’re thinking of leases — the BSEE’s site lists 69 deepwater permits approved of 107 submitted.

    http://www.bsee.gov/Regulations-and-Guidance/Permits/Status-of-Gulf-of-Mexico-Well-Permits.aspx

    Problem is, the majority of them are permits to *resume* drilling at existing sites…

  83. Torgir Hansson says:

    “What Obama is saying is that drilling in the U.S. will not solve the short-term price issue at the pump.”

    How utterly naive and credulous. If there is a shortage of a commodity, then ANYTIING done to alleviate that shortage is a good thing. If drilling in the U.S. will not completely solve the problem, it will solve a large part of the problem. Do you not understand that Obama is simply making excuses, and lying to the public?

  84. Torgeir Hansson says:
    March 20, 2012 at 1:33 am
    “Dear Smokey:
    Governments need money to function. You may not like it, but governments are the agents of the people. Both driving and smoking cost money to society, as there are cheaper alternatives.”

    Name me a cheaper alternative to driving.

  85. Larry in Texas says:
    March 20, 2012 at 1:17 am
    Torgeir Hansson says:
    March 19, 2012 at 11:42 pm

    “If the Democratic Party in this country hadn’t spent as much time halting exploration efforts in this country for the last 40 years, we would not be talking about gasoline prices here like we are now.”
    ______________

    Dear Mr. Larry in Texas:
    Out of the last 40 years there have been Republicans in office for 28 years. Either Republican Presidents are incompetent, or they are part of the problem. Or you didn’t get the memo that oil prices are set by global, and not domestic, factors.

    Thanks for playing, Larry.

  86. Smokey says:
    March 20, 2012 at 1:37 am

    “How utterly naive and credulous. If there is a shortage of a commodity, then ANYTIING done to alleviate that shortage is a good thing. If drilling in the U.S. will not completely solve the problem, it will solve a large part of the problem. Do you not understand that Obama is simply making excuses, and lying to the public?”
    __________________
    Then you explain why oil production has fallen for 23 out of the 30 last years, a majority of which were under Republican Presidents. It’s global pricing, Smokey. That’s what you call the “problem,” which is the international oil market, run mostly out of New York and London. By private entities. Brokers. Speculators. Call them what you want.

    Again, check your facts.

  87. Regarding the Net Energy Balance (Energy Out – Energy In) of various energy technologies:

    In the fifteen years from 1996 to 2011, Canadian light crude production decreased by almost 10%, heavy oil and condensate production each decreased by almost 20%, and oilsands production increased by almost 400%.

    Because of the outstanding success of the Alberta oilsands, Canada is now the 6th largest oil producer in the world and the largest foreign supplier of oil to the USA.

    Unlike worthless grid-connected wind and solar power that ARE heavily subsidized, Canada is NOT subsidizing oilsands production – it is in fact the mainstay of the Canadian economy and the primary reason Canada has the strongest economy in the developed world.

    There may be poor energy fundamentals in some in-situ oilsands projects, since natural gas now costs a small fraction of the energy-equivalent price of oil* – natural gas is burned to raise steam to extract the heavy bitumen in in-situ oilsands operations – not so for oilsands mining projects.
    [* at $108 per barrel, the energy-equivalent price of natural gas is $108/6=$18 per GJ, whereas natural gas is now selling at $2-3/GJ)

    Grid-connected wind power, solar power and corn ethanol all require huge life-of-project subsidies to survive. This is probably a good proxy to indicate that these technologies have a Net Negative Energy Balance. If not, why do they need the huge life-of-project subsidies? In my opinion, and I have studied energy much of my life, these three technologies are, at this time, counterproductive energy nonsense. Furthermore, wind power can dangerously destabilize the entire power grid.

    Much enviro-nonsense has been written about the negative environmental impact of the Alberta oilsands. One example is the cry that the oilsands are draining the Athabasca River by consuming all the water. One would think from all the green alarmist rhetoric that the oilsands consume 99% of the river’s annual flow. The actual figure is 1%. That’s right, 1%. The subject is a bit more complicated than this, but you get the idea.

    Green alarmism is big business, fueled by cash donations from gullible donors and great steaming piles of green BS.

    To understand the big picture, understand this:
    If you live in the developed world and you suddenly lose access to cheap reliable energy, you and your family will probably not survive. When idiot politicians fool around with energy policy and try to pick winners and losers, they are playing a very dangerous game. When they base their energy policy decisions on fraudulent global warming “settled science”, they are playing a fool’s game. Either way, you lose.

  88. Torgir Hannson says:

    “Out of the last 40 years there have been Republicans in office for 28 years…”

    How many of those yeas have been controlled by a DemocRat legislature? Answer: Most of them. But by all means, continue your alarmist propaganda.

  89. Allan,
    I believe solar is a good alternative for many residences. As many homes as possible should have solar. I hear the industry talk about grid parity, but the limitations are obvious. The number of players in the solar industry who talk about “climate change” is dwindling rapidly. It’s all about dollars and cents. Still based, of course, on the 30% Federal tax credit.

  90. Smokey says:
    March 20, 2012 at 2:12 am
    “How many of those yeas have been controlled by a DemocRat legislature? Answer: Most of them. But by all means, continue your alarmist propaganda.”
    ____________________________

    You are right. The Democrats held the House for a majority of the last 40 years. Republicans had the majority between 1995-2006. During that time oil production fell every year. EVERY year.

    For the Senate, the Republicans had the majority from 1981-86, 1995-2000, 2003-06. Let’s look at the period between 1995 to 2006. During that time oil production fell every year. EVERY year.

    Any more demurrers from you, Smokey?

  91. Torgeir Hansson says:
    March 20, 2012 at 1:46 am
    Bill Tuttle says:
    March 20, 2012 at 1:35 am
    “He didn’t slow the process down, he called it to a complete halt.”
    Untrue, Bill. Here:

    http://www.politifact.com/truth-o-meter/statements/2011/mar/29/michele-bachmann/michele-bachmann-claims-there-has-been-just-one-ne/

    Try to read up on the facts next time.

    *ahem*

    “Frustrated twice by the federal courts—which had overturned his original temporary moratorium on deepwater drilling—President Obama Monday evening decided to do what most of us have probably wanted to do when denied by someone in a position of authority: he went ahead anyway. (Sometimes it’s good to be President.) Interior Secretary Ken Salazar directed the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM)—the government agency formerly known as the Minerals Management Service (MMS)—to issue new suspensions of deepwater drilling on the Outer Continental Shelf, while investigators continue to look at the Deepwater Horizon catastrophe.”

    http://ecocentric.blogs.time.com/2010/07/12/obama-issues-new-offshore-drilling-moratorium/

    The Obama administration’s six-month delay in approving new offshore drilling leases in federal waters will become a new three-year ban, Interior Secretary Ken Salazar quietly told reporters last Friday. Which means that no new oil and gas leases will be approved during President Obama’s term…

    http://washingtonexaminer.com/politics/beltway-confidential/2010/03/obama-moratorium-no-offshore-drilling-while-he%E2%80%99s-office/5916

    My emphasis, both quotes.

    The top two hits of 856,000 for the query terms “Obama moratorium on offshore drilling” — would you kindly enlighten me as to where I might find the fact that Obama did *not* call a halt to offshore drilling?

  92. It seemed clear some time ago that Obama had stopped believing in the AGW myth. He has the intelligence and open enough mind to step away from something when the evidence shows it is make-believe.
    Politically he can’t yet say this, of course.

    Harpo

    He is a politician. Itelligence does not come into this equation. Cunning, deceit, lieing yes and very good at he is, at least the straight face bit.

  93. Torgeir Hansson,

    You are discounting the influence of the eco-retards. Eliminate their vote-buying, and you will understand the problem.

    …you are not an eco-retard… are you? Just wondering. I certainly hope not.

  94. I will not follow you into the assumption that this Administration is out to ruin the country. That is a toxic notion.

    Torgeir Hansson says:
    March 20, 2012 at 2:26 am

    No and I don’t want you to follow me. Unlike you I have run a business and I know for a fact that the Obama administration has been doing everything it can to destroy the business community in the US. You can start with his unending attacks on the banks and wall st and finish with his Waxman markey, Dodd franks bills. Every business man in america has been slamming these bills from the beginning. A health bill that describes 19 ways to be attacked by a parrot and a finance bill which creates a bureaucracy that will costs millions of $. You my friend have the knowledge of the unemployable.

  95. Torgier Hansson,
    For the average man in the street ( that I would presume include Smokey ) the most important factor is not who is drilling, or who is producing what, but the price at the pump !
    Now good Sir please explain in your infinite wisdom what were the price increases at the pump from 1995-2006 (11 years ) and the increases in the last administration (4 years )?

  96. Torgeir Hansson says:
    March 20, 2012 at 2:16 am
    “Allan,
    I believe solar is a good alternative for many residences. As many homes as possible should have solar. I hear the industry talk about grid parity, but the limitations are obvious.”

    When the solar industry says “Grid parity”, they mean that the solar subsidy cost for the taxpayer or ratepayer per kWh is equal to the ratepayer rate (which is production cost of energy plus xx percent taxes).

    In other words, they DON’T mean that the production cost of solar power beomes equal to any other way of producing electricity; their “Grid Parity” is a propaganda term they defined for their own purposes. It is useless for cost considerations.

  97. We humans have been extracting gold and silver from the bowels of th earth for tens of thousands on years. Then we went for copper, tin, zinc and lead. Each discovery gave us a technological leap forward. Later on we discovered iron, which gave us a quantum leap. We continued discovering ores and transforming them into technological material for the advancemnt of humanity. Aluminum was the latest addition to the metallurgical field. meanwhile we had been extracting diamonds and other precious stones for our kings and queens, our temples and churches, hollywwod stars and billioners..

    Some 150 years ago we started extracting oil, making our civilisation what it is today. Just 150 years of extracting black gold and we are hearing and reading of ‘peak oil’.

    During these thousands of years of extracting gold and silver, copper and tin, lead and steel, diamonds and rubies, we never heard or read someone shouting peak gold, or peak iron or peak diamonds. But after 150 years of extracting oil we hear of peak oil. This is just rubbish. Have a look at a world map and mark the points from where we have extracted oil up to this day and one will realise that we have just scratched the surface. This is all a scam for robbing us of our hard-earned wages for others to get richer and richer and richer while the western countries are floundering in the financial mire. The latest scam is EU issuing 100 year bonds, meaning that the banks are getting loans from our great great great grand children…………..

    All it takes to remedy the situation is to have a US president that is honest about this and acts honestly. That’s all the world needs; an honest US president.

    I just wish I can fake US citizenship and come and vote come November.

  98. Moderator’s wrote: “This comment is acceptable. Please remember, however, that we are talking about the President of the United States and there are some lines that will not be crossed. Please exercise… shall we say, discretion? in comments. Thank you for your cooperation.”

    I agree Moderator that a civil discourse is the best way to win an argument and that “there are some lines that” should “not be crossed”. But I think those lines should apply equally to everybody, with no special treatment for a president.

    Sometimes you learn more about your own society by studying others. I’m British and a life-long republican i.e. against the institution of constitutional monarchy, which I think is an anachronism. But after observing the American political process my views have started to change.

    During the Iraq war many American ‘progressives’ were appalled at, what they perceived to be, a reluctance by the press corps to ask President Bush tough questions. John Stewart, of The Daily Show, made a trans-Atlantic comparison: “the British Prime Minister has to stand in Parliament, every week, and respond to the questions of his most vociferous critic” (paraphrased from memory).

    I think the reason the British press give their Prime Minister a much tougher time than their American counterparts do their President is because of the differences in the political systems.

    The British Prime Minister is not the Head of State. He lives in a house known by its street number, not a royal palace. Nobody sings Hail to The Chief, in his honour. He has to symbolically bow to someone else who represents the state -the British monarch (not the Saudi one).

    British royalty’s role is purely symbolic, with no significant political power. Parliament has the power to abolish it at a stroke. Despite their symbolic position, if any member of the royal family says or does anything stupid, they will be ridiculed as freely as anyone else, in fact more so. I’m not going to be thrown into the Tower of London for calling Prince Charles an idiot. He is, and I think most of my countrymen agree.

    The system works well and I think that is the reason so many Commonwealth countries still have the British monarch as their head of state, despite a lot of post-colonial bitterness. I think it is also one of the reasons former British colonies tend to be more stable democracies than many other young nations.

    I’m still an anti-royalist but not as much as I was.

    Sorry, this is turning into an essay and is possibly off-topic. So, I’ll cut it short.

    I was glad to see the rise of Obama, then concerned to learn about his background, which the the U.S. media did not adequately explore. [Yes I read all about birth-certificates etc. and I'm not talking about those]. I don’t worry about him so much now. He has disappointed many of his supporters. I think the thing Obama believes in the most is himself. He is a Zelig, capable of doing and saying anything, to curry favour with whichever group he happens to be with. And he is a narcissistic, capable of doing and saying anything, to promote himself.

    P.S. If you ex-colonials want to rejoin the Commonwealth, I’m sure something could be arranged. :)

  99. The point of the post: Obama can’t even mention climate change or AGW in an energy speech. Convincing evidence that Al Gore is right – “the debate is over”

  100. Just a piece of political antipropaganda this piece. In my view WUWT should stay to be about climate as much as possible and stay away from politics. Being a climate sceptic is about looking at te facts, being a politician is about using some facts for your goal. This piece is clearly the latter.

  101. “If we drilled every square inch of this country — so we went to your house and we went to the National Mall and we put up those rigs everywhere — we’d still have only 2 percent of the world’s known oil reserves.”

    I wish the alarmists would apply similar logic to their beloved windmills.

    Paraphrased:
    If we placed wind-turbines on every square inch of this country — so we went to your house and we went to the National Mall and we put up those turbines everywhere — we’d still generate a fraction of the energy that we need.”

  102. Since this is political, the battle is not with facts, figures, logic, analysis, etc., but one of sound bite “slogan’. Sound bites coupled with the 30 second ad. The result of this will be all so predictable, like watching A Wonderful Life. The topic is drawn along a narrative boundary with some sliver of fact (recall the meaning of “is”). It’s repeated by the policital machines and then amplified by the MSM. It’s extremely conforting to read articles like this since it provides knowledge comfort. If you turn your analysis to how the Left/Greens work, they spend perhaps 10% of their articles simply referring to someone else’s conclusions then proceed to examine how best to market their concept. Reasoned folks tend to simply stop at “Aha! I know the truth” and make a leap of faith that voters will do the same when they go through the facts. Just ain’t every gonna happen. We’ve decades of proof.

    What to do? Use this article as the “reference back” and then spend your efforts in beating their narrative on their field of play – meaning ad war. And it has to be effective, simple, etc. The gist would be an ad that states “Obama says we’re developing our energy resources as fast as we can but doesn’t tell you he’s tied both arms and legs behind our back”. Let them bore folks to tears with their “figures”. Respond with very short bits such as “Why not Anwar?”, “Why not oil shale”, “why no pipelines”, “why is China drilling off our coast but we’re not?” – things like that.

    Remember, in this game, a draw is a loss.

  103. Vangel Vesovski.

    You are far behind the times in terms of the on-going shift in world energy production. We are seeing a paradigm shift. There is a huge amount of energy production about to break out from politically stable portions of the world, not just the USA.

    Consider the geo-political implications if Israel becomes a Saudi class Oil exporter of light sweet crude at $35-$45 a barrel, and a major Natural Gas exporter, in about 7-years.

    Once Israel breaks the risk premium (capital risk of the technology and the political risk premium from Arab oil retaliation and Green Regulatory NIMBY-ism) of the deep oil shale extraction and waterless deep gas fracking. (See article below) We will see a huge amount of energy sources emerging in politically stable areas of the world at $35-$45 a barrel.

    Israel is providing an example of how oil consuming nations can become oil producing ones.

    Forget Europe and America for a moment. Think China.

    And once Israel goes there for oil shale, the barriers to coal gasification and natural gas to liquid hydrocarbon will also fall (Just google “Shell GTL” or “Pearl GTL” for the basics.), following deep oil shale extraction into the stable world energy mix.

    $4 a gallon is the upper market limit on refined fuels, absent government interference via taxes, environmental regulations, moratoriums on energy development, and political instability risk premiums.

    Liquifaction of coal to synthetic POL is now feasible at $4 a gallon pump price, and Shell’s natural gas liquifaction plant in Malaya has been converting natural gas to diesel for years. Shell’s new CFL plant in Louisiana is producing synthetic diesel from natural gas because diesel’s pump price is over $4 a gallon.

    This is a set of technologies that will power the world economy for the next 50 years…without the Arab oil ticks.

    http://oilprice.com/Energy/Crude-Oil/Israel-May-Hold-the-Worlds-Third-Largest-Reserve-of-Shale-Oil.html

    Israel May Hold the World’s Third Largest Reserve of Shale Oil
    Last summer huge deposits of natural gas were found along Israel’s northern coastline.
    As with almost everything having to do with that controversial country, both Israelis and others found this “revelation” a mixed blessing, to say the least. On the one hand, it certainly eases concerns about Israel’s energy viability, with enough not just for its own needs, but sufficient quantities to become a major exporter as well.

    At the same time, many Israelis feared the effect such “easy money” would have on the country’s already significant elite corruption problem, and its proximity to Lebanese territorial waters raised once again the question of the wisdom of Israel’s 2006 invasion, which alienated many previously pro-Israeli elements in Lebanon, and seemed sure to fuel a national consensus to contest any easy access for which Israelis might be hoping.

    Hmmmm … sounds a bit like BP and their Arctic drilling problems in Russia … ;-) …

    Now, it turns out, even more fuel is being added to Israel’s energy fire — so to speak — with the equally stunning news that the country may hold the world’s third largest quantities of shale oil – behind the US and China, both of whom would consume almost all of their own production – meaning Israel could indeed become the world’s largest exporter of shale oil — hence the comparison to Saudi Arabia.

    Israel a global super power in energy ??? The mind boggles.

    But the same sort of technological revolution that has made previously inaccessible on-shore natural gas suddenly available – via a process of hydraulic fracturing, or fracking, an environmentally destructive process whose impact on the global natural gas scene we discussed last week – is now apparently transforming the extraction of shale oil as well – and in so doing, shaking up the energy dynamics of the entire world, including Israel.

    How did all this come to be ???

    The most recent developments in this story start with Dr Harold Vinegar, the former chief scientist of Royal Dutch Shell, who is at the center of an ambitious project to turn Israel into one of the world’s leading oil producers. Israel Energy Initiatives, or IEI, where Vinegar is chief scientist, is working on projects to extract oil and natural gas from oil shale from a 238sq km area of the Shfela Basin, to the south and west of Jerusalem.

    Oil shale mining is often frowned upon by environmentalists for many of the same reasons as fracking: it’s a dirty process that is both energy and water-intensive.

    IEI, which is owned by the American telecom group IDT Corp, believes its technique will be cleaner than that of other operators because the oil will be separated from the shale rock up to 300m beneath the ground.

    Water will be a by-product of the process, rather than being consumed by it in large volumes. Vinegar says Israel has the third-biggest oil shale deposits in the world, outside the US and China:

    “We estimate there is the equivalent of 250 billion barrels of oil here. To put that in context, there are proven reserves of 260 billion barrels of oil in Saudi Arabia.”

    And not to upset too many people, but we also ran an item earlier this year about Arab scientists working for ARAMCO who argue that the Saudis have, in fact, systematically OVER-estimated their proven reserves.

    IEI estimates the marginal cost of production will be between $US35 – 40 per barrel.

    This, Vinegar points out, is cheaper than the $US60 or so per barrel that it costs to extract crude from inhospitable locations such as the Arctic – wow, if BP CEO Dudley isn’t gnashing his teeth when he reads this ;-) – and compares with $US30 – 40 per barrel in some of the deepwater oilfields off the coast of Brazil.

    “These Israeli deposits have been known about, but have never been listed before. It was previously assumed there was not the technology to deal with it.”

    IEI hopes to begin production on a commercial basis by the end of the decade, with a view to producing 50,000 barrels per day at the outset. This would be a fraction of the 270,000bpd consumed daily by Israel, but would be a significant step towards making the country energy-independent. With one barrel of oil comprising 42 gallons, Vinegar estimates each ton of oil shale contains approximately 25 gallons.

    The extraction process involves heating the rock underground, using electric heaters, to approximately 325C, the level at which the carbon-carbon bonds in the rock start to “crack”.

    Wow, this really DOES sound like the shale oil equivalent of “fracking”. The oil produced by the process is light and easily refined to a range of products, including naphtha, jet fuel and diesel.

    This is significant, since light oil — like that produced in Libya — is considered “sweet” and much less costly to refine than the heavier crude found in Saudi Arabia.

    Given the importance of political receptivity to outside investors in the energy business, it’s not surprising the project is attracting serious interest from outside investors. In November, 2010, an 11% stake in Genie Oil & Gas, the division of IDC that is the parent company of IEI, was acquired for $US11m by Jacob Rothschild, the banker, and Rupert Murdoch, chairman of News Corporation and promoter of right-wing lunacy throughout the English-speaking world.

    Genie’s advisory board includes impressive figures such as Michael Steinhardt, the hedge fund investor, and more frightening ones, like Dick Cheney, former US vice-president, and co-founder of the Shiite Islamic Republic of Iraq, along with his running buddy George W Bush.

    An appraisal is now under way that would be followed by an 18-month pilot stage, according to Vinegar. Among the issues this will address will be concerns raised by environmental groups, including an examination of IEI’s claims that the process does not require excessive use of water or energy.

    Reassurance will also be sought that a local aquifer, which is several hundred metres below the shale deposits, will not be contaminated by the work. This is key, because, while the Middle East may have an abundance of fossil-fuel energy, it has a decided shortage of water, so any process that is a major net consumer of water may not be cost-effective from an overall point of view.

    Assuming these early stages are completed successfully, a demonstration phase would then take place over three to four years, during which the work completed in the pilot phase would be continued on a larger scale. Only then would the commercial operations begin.

    By that time, up to 1000 people would be employed on the project, many of them specialist engineers from outside Israel, says Vinegar, who adds:

    “Funding is not needed for the pilot and demonstration, although once we get to 50,000 barrels per day, we would want to have a partner. We have been approached by all the majors.”

    Not surprisingly, the project still faced a number of significant issues, as Vinegar points out:
    “There is a geological risk:
    – Is the resource there?
    – What is the risk to the aquifer?
    – We have no doubts here, in particular that the resource is there and is of good quality,
    – but the pilot can prove these things.

    “Then there is the technological risk:
    – Can we drill long horizontal wells?
    – Can the heaters be placed in them?
    – And can they last?

    “And finally there is the economic risk, what the price of oil does. But I think the price is going to continue rising, to the extent that, by 2030, we will be at around $US200 per barrel.”

    And while this seems to have escaped Vinegar’s attention, which is not a great sign, there is a fourth potential risk for the project: whether it is capable of sufficiently overcoming substantive objections from environmentalists to win popular support – perhaps the most important challenge facing him and his colleagues.

    If they are successful, though, it will probably mean an end to one of the most humorous stories in Jewish culture about fossil-fuel energy: During a crowded Passover service, a rabbi telling the story of the Exodus from Egypt was interrupted by an old man, who kept shouting, “Moses was a schmuck, Moses was a schmuck.”

    Of course, the congregation was shocked, and the stunned rabbi finally asked the old man why he was criticizing the great hero of Judaism / Christianity / Islam. The old man replied without hesitation: “He said when they come out of Sinai, turn left. If he had any brains, he should have told them, “Turn right.'”

    David Caploe PhD
    Chief Political Economist
    EconomyWatch.com

  104. “Gerard says:
    March 20, 2012 at 3:47 am

    Just a piece of political antipropaganda this piece. In my view WUWT should stay to be about climate as much as possible and stay away from politics.”

    I could not agree more. This piece is WAY wrong on Canadas data, so why would anyone take this piece seriously? Canada probably has 2000 billion bbls equiv, ie, 10X as much as is shown.(oil sands, coal, NG, arctic, shale)

    WUWT will decend into nothingness as left/right warfare will break out. This piece is just trash talk, not worthy of WUWT!

  105. Obama will pretend to be whatever he thinks he needs to in order to win reelection. Let’s not be stupid and believe the pretense. If he wins, we’ll have 4 more years of an EPA which thinks CO2 is a pollutant that only the government is wise enough to control, no Gulf of Mexico oil drilling, no Keystone pipeline, incomprehensible commitments to heavily subsidized, inefficient wind turbines, and the like. Not to mention 4 more years during which eco-liberals masquerading as climate scientists will continue to get Federal money to promote and brainwash the population with “research” into their pre-determined conclusions. And I won’t even start on Federalism, health care or entitlements.

  106. Gerard says:
    March 20, 2012 at 3:47 am
    Just a piece of political antipropaganda this piece. In my view WUWT should stay to be about climate as much as possible and stay away from politics.

    WUWT “deals with puzzling things in life, nature, science, weather, climate change, technology, and recent news” — the speech was puzzling enough, and it was certainly in the news…

  107. @Stephen Richards says:

    It seemed clear some time ago that Obama had stopped believing in the AGW myth. He has the intelligence and open enough mind to step away from something when the evidence shows it is make-believe. Politically he can’t yet say this, of course.

    Harpo

    He is a politician. Itelligence does not come into this equation. Cunning, deceit, lieing yes and very good at he is, at least the straight face bit.

    If you were a politician, and you needed votes from an uneducated population, what would you do? What could you do? If you try to tell them the truth (on any subject) they will reject it and vote you out.

    Politics nowadays is the art of saying things which get more far-right libertarians AND far-left socialists AND everybody in between to vote for you than your opponents. There used to be a time when politicians stood up and said (for example):

    ‘I am a medium-left socialist – this is why – vote for me if you think the same way I do’.

    Those were the days when democracy worked because principles were involved. Nowadays focus groups try to construct a set of beliefs which will can be accepted by 34.8% of the Hispanic population and 22% of the Irish…

    Unfortunately, nobody is interested in a set of beliefs which can be accepted by 80% or more of educated people. There are too few educated people to matter.

  108. David Caploe wrote:
    “He [Moses] said when they come out of Sinai, turn left. If he had any brains, he should have told them, “Turn right.’”

    I think you missed the usual punchline to that joke, which is:

    “We would have got all the oil and the Arabs would have got all the oranges”

    I haven’t read anything else indicating such large reserves in Israel. There is definately gas offshore. Hopefully, the field extends into Lebanese territorial waters. Oil rigs create wealth but are vulnerable. Perhaps the Lebanese will see that blowing up bits of their neighbour is not in their best interest.

  109. Anthony — this piece is way way too ‘two-party politics’ for my tastes and is far from the usual for WUWT where policy can be argued but party-based political screeds have not normally been posted. It reads like the ranting of some right-wing TV pundit–inappropriate here, I think.

  110. ouis says:
    March 19, 2012 at 7:31 pm

    I don’t understand why we can’t do both. Why can’t we continue to drill for oil while alternative energy sources are being developed.
    _________________________________
    No one is against developing alternate energy sources. I would love to see mini thorium nuclear reactors become available. http://nextbigfuture.com/2010/10/partnerships-toward-minifuji-thorium.html

    What we are screaming about is wasting tax payer money on alternate energy sources that just do not work and can not because of the physics or mechanics involved and further more have a rotten Return on Investment for the tax payer. For example windmills are great for moving water but worse than useless for producing electricity because they unbalance the grid. Solar panels are great for remote use where it is a pain in the rump to run electric wires. see: http://www.pcsn.ca/solar-energy-technology-2/

    The really useful alternate energy source is nuclear but the eco-nuts will do anything to kill it including LIE: http://atomicinsights.com/2012/03/conversation-with-an-anti-society-antinuclear-activist.html

    Discussion on Thorium: http://www.physicsforums.com/showthread.php?t=358038

    ….Thorium fuel has been demonstrated in the Shippingport reactor.

    More at – http://www.world-nuclear.org/info/inf62.html

    Thorium fuel cycle — Potential benefits and challenges – http://www-pub.iaea.org/MTCD/publications/PDF/TE_1450_web.pdf

  111. I get a little weary of the Oil is fungible/internationally traded argument. Yes, it is NOW. But it doesn’t have to remain that way. Other commodities – from diamonds to timber are also traded internationally but treated as standard trade goods. We could easily trade excess US oil on our terms rather than being driven by OPEC or Brent. Granted there is no US crude excess at the moment, but it wouldn’t take long to change that. We used to supply the world with oil – remember?

    • Granted there is no US crude excess at the moment, but it wouldn’t take long to change that. We used to supply the world with oil – remember?

      That was a long time ago and will never come back. We have to be realistic about what we see, not depend on models and pronouncements not supported by actual data. By now you should realise that the shale gas story was little more than hype. Producers needed $7-$9 per Mcf gas but were stuck drilling even when prices fell to less than $4 per Mcf. While that was great for consumers of gas it destroyed capital and blew up the balance sheets. We are now expected to forget the shale gas fiasco and believe that shale liquids will somehow be very different. But the truth is found in the 10-K cash flow statements and footnotes, not in narratives from people who missed the shale gas story because they didn’t understand what was going on.

  112. I don’t know what Obama really believes, at least when it comes to energy. He appears to say whatever it takes to get elected — just look at his laughable claims of supporting an “all-of-the-above” energy policy all along.*

    However, nobody can point to an example where alternate energy really works. It requires tax-payer subsidies wherever it’s installed. It costs much more than conventional energy sources. It’s less reliable than conventional energy sources.

    There is no economic miracle associated with alternate energy. Nowhere does the industry stand on it’s own, not even in China. For now, and the next few years, alternate energy is just another progressive, Utopian pipe-dream.

    * Technically, “all of the above” is correct because in Obama-world, the only choices are:
    A) Solar energy companies back by Obama bundlers.
    B) Wind-power companies backed by family members of prominent Democrat politicians.
    C) Ethanol backed by the farm lobby and ADM
    D) Biofuels companies backed by Democrat fund-raisers
    E) All of the above

  113. John R. (Rich) Van Slooten says:
    March 19, 2012 at 8:21 pm

    Having a 40 yr. background in the petro-chem & oil/gas industry, MS Che, senior process consultant, working in the syn-fuels industry…
    ___________________________________
    From another chemist (retired) who worked in plastics and pharmaceuticals THANK YOU!

    I shut up one eco-nut who was bashing plastics by telling her that if she hated plastics so much she should hand me her house keys, car keys and her clothes or else she was a G… D… hypocrite! She turned beet red and stomped off while her audience laughed. (The plastics plant I worked at had just been closed two days before, thanks to the MSM lambasting of plastics)

  114. “Vangel, your assertions are dated and untenable.”

    But that is not true. After years of hyping shale gas we have yet to see the shale gas producers generate positive cash flows or to see the sector make a profit once all of the costs were accurately accounted for. It is easy to show a profit if your EURs are twice what the production data is suggesting but that can only last for a short period of time. That is quite evident to anyone who has bothered to look at the 10-K filings or listen in on the conference calls of the producers. If you do you find most management groups talk about ‘funding gaps’ that would never exist if the shale gas story were correct.

    Now you could argue that shale oil is different but I for one am quite skeptical. It is easy to make money on shale oil if you have operations in the sweet spots of the best shale formations. But you can’t extrapolate those results for all of the formations, which is what we need if the argument in the narrative above were to be true. As an investor in unconventional production I am much more skeptical than the naive optimists and the corrupt promoters that are given most of the opportunity to spin their stories. And as with my AGW positions I prefer to look at empirical evidence rather than models and narratives coming from ‘official’ sources.

  115. The whole, “We have increased drilling because of our policies” goes right along with “Obamacare will decrease health care costs and the deficit.”

  116. “Did you mean “oil sands”, Vangel?”

    Yes I did. Tar sands is a much more appropriate name. Those of us who invest in the companies there understand the issues involved and can assure you that things are not quite as the naive optimists or the ecoterrorists are portraying them as being.

  117. How can anyone want higher fuel prices and expect that it would be good for the economy? The cost of fuel is built into the cost of everything, including electricity, food, clothing, books, automobiles, everything. It would cause a general increase in the cost of living, which would prompt people to get a raise to cover it. That’s all that would happen. Increasing the cost of fuel does not affect fuel consumption in any significant way really, or alter our behaviour over the longer term, it only increases the cost of living. We simply increase our wages to offset it.

  118. “And the production data is unaffected by moratoriums, revoked permits, or bureaucratic delays, right? Do you think a 6% drop in oil production on federal lands taking place at the same time as a 14% increase on state and private lands is just a coincidence? The drop in production on federal lands has nothing to with bureaucratic stonewalling. That oil just happens to be less recoverable than oil on private lands, right?”

    That is not what I am talking about. I am bringing up the data from existing wells in some of the best areas in the best formations. That data is showing a huge depletion rate and EURs that are twice what they should be. In fact, the analysis of the production data seems to be indicating that the average EUR/well is about half the value claimed by the operators in the shale gas sector. This means that to break even you need a price of $7-$9 per Mcf.

    Let me get back to a simple statement that is very hard to refute. For most of the past seven years we were told how profitable, abundant, and great shale gas was. But none of the claims came to be. Most of the larger players chewed through capital as they produced gas for a much higher price than they could get on the market. Now we have seen the larger players announce a move towards shale liquids and we are hearing the same old hype yet again. As a skeptic who is heavily invested in unconventional production I just don’t buy it. If you want to convince me show me the cash flow and the dividends, not some stories by the EIA or USGS.

  119. The trouble with democracy, as it is implemented, is that you get people you don’t like elected to power: because they are plausible, or rich, or both, or …. whatever.

    The only consolation is that democracy (as implemented) is a whole lot better than the alternatives on offer. So let’s put up with its limitations.

    I would like WUWT to have less about the perceived iniquities of the elected leaders of a foreign land and more about the masthead topics (puzzling matters, nature, science, weather …).

    You will have gathered that I am not a citizen of the United States, although I do admire the generosity and tenacity of its citizens.

    • The trouble with democracy, as it is implemented, is that you get people you don’t like elected to power: because they are plausible, or rich, or both, or …. whatever. The only consolation is that democracy (as implemented) is a whole lot better than the alternatives on offer. So let’s put up with its limitations.

      I disagree. A tyranny of the mob is no consolation to those who prefer freedom and freedom is always a choice, particularly when you have a Constitution that makes clear that 99% of what the federal government does is not permitted by the law of the land as written. What you need is to stop compromising and insist on a limited government.

      That said, liberty is too stiff a drink for most people, particularly those in the mainstream who have learned to be dependent on government telling them what to think and what to do. These people are foolish enough to actually believe that there is a material difference between the GOP and the Democrats and hope that if just the right man (or woman) were elected the system can remain as it is and things will still work out. Sadly, reality is what it is and not what these people hope it is.

  120. jimboskype1939 says:
    March 19, 2012 at 8:35 pm

    Obama is not to be trusted. He is in election mode and is now playing to the centre so you can be sure he is NOT going to play up to the Warmistas.
    ________________________________
    Just once I would like to be able to vote FOR a candidate instead of picking the lesser of two evils.
    Former Senator John Danforth on those currently running for the Republican nomination:

    “I’ve been watching some of these Republican debates and they’re just terrible… [I]t’s embarrassing for me as a Republican to watch this stuff.”

    I am afraid I have to agree with him. It is as if the Republican party is trying to drive voters (Independents) away from them and towards third parties so that they can make sure Obama wins. Given that the R vs D is just a dog and pony show for the “Great Unwashed” and the moneyed folks own both parties I would not be surprised if that was actually the case.

  121. James Sexton says:
    March 19, 2012 at 8:14 pm

    Lol, not really…. “Advances in thermally conductive in-situ conversion may cause shale-derived oil to be competitive with crude oil at prices below $30 per barrel. …..” Continuing, ….“With the exception of the Alberta-Taciuk Processor, no significant development work in surface retorting has occurred for more than 20 years. During this period, major technical advances have occurred in process monitoring and control, process simulation and modeling, chemicals separation and purification, and systems and methods for reducing adverse environmental impacts.” More…… “We assume operating and maintenance costs for first-of-a-kind plants to be between $17 and $23 (2005 dollars) per barrel (OTA, Volume I, 1980; Albulescu and Mazzella, 1987).10 Given these capital and operating cost estimates, we project that the price of low-sulfur, light crude oil, such as West Texas Intermediate, will need to be at least $70 to $95 per barrel for a first-of-a-kind oil shale operation to be profitable.” What’s the price per barrel today? Oh, yeh $108 ….. but, that was just a first gen estimate…… “For initial production costs between $70 and $95 per barrel, experienced-based
    learning could drop those costs
    to between $35 and $48 per barrel within 12 years of the start of commercial oil shale operations.” ……… but all of that was for off-site retorting.

    http://www.rand.org/pubs/monographs/2005/RAND_MG414.pdf

    =====================================

    Sorry but I prefer to look at the objective evidence instead of assumptions, mays, coulds, and other expressions of hope. And I am quite aware in the ‘advancements’ made in unconventional recovery because I have invested in them and talked to the people who made or implemented them. None of what I have seen convinces me that there is much of a profit to be made in extracting shale gas and liquids from the average shale formation.

    Note that I have not dismissed the sweet spots in the good areas. For a small producer who limits his operations to the areas that make sense there is a lot of money to be made and if I see such opportunities I would have no problem taking a risk investing in them.

    But what worries me the most is that the hype being pushed by the charlatans who tout the promise of shale production is diverting attention and investment from other sources. From where I stand the level of debt in the shale sector reminds me a lot of the subprime crisis in 2006. If there is a slight setback in the real economy for a period of six months or so I can see more than 80% of the shale sector going into bankruptcy within the following year with most of the drillers leading the way.

  122. I am just hoping the last 30 years of purchasing other people’s oil has been a concerted long term effort to use that up first. Kind of like going to someones house and drinking their beer until it is all gone then going home and still having a refrigerator full of your own beer.

  123. Thank you. Please do all you can to get the word out. The MSM like NY Times, Guardian and The Economist are all denying the obvious: The Obama administration has been an unmitigated disaster for the economy – they have attack fossil fuel businesses, subsidized uneconomic green scams and thrown money at their friends the banksters. Cheap energy is good for America. Expensive Green scams are not. And printing money like there is no tomorrow will simply make everything more expensive as America’s fiat currency devalues.

  124. The President: “What he does, not what he says.”

    Study: EPA air emissions rules could cause substantial slowdown in drilling

    http://api.org/news-and-media/news/newsitems/2012/mar-2012/study-epa-air-emissions-rules-could-cause-slowdown-in-drilling-reduced-govt-revenue.aspx

    Carlton Carroll | 202.682.8114 | carrollc@api.org
    WASHINGTON, March 15, 2012 – The New Source Performance Standards for oil and natural gas production proposed by the Environmental Protection Agency (EPA) would significantly slowdown drilling, resulting in less oil and natural gas production, lower royalties to the federal government, and lower tax payments to state governments, according to a new study funded by the American Petroleum Institute.

    “EPA needs to fix these rules in a way that they’ll reduce emissions but not impede oil and natural gas development, which creates jobs and government revenue and improves our energy security,” said Howard Feldman, API director of scientific and regulatory affairs.

    The study – by Advanced Resources International – shows that the regulations as proposed would reduce drilling for natural gas using hydraulic fracturing by up to 52 percent, reduce natural gas production by up to 11 percent, and reduce oil production by up to 37 percent. As a result, the federal government would not collect up to $8.5 billion dollars in royalties and state governments would not collect up to $2.3 billion in severance taxes due to reduced drilling and production.

    Feldman asked the EPA to avoid the one-size-fits-all approach for emissions completions; to allow more time to implement the requirements; and to streamline the compliance and recordkeeping requirements.

    “Natural gas prices are half what they were three years ago because of the shale boom, and this is benefiting consumers and businesses,” Feldman said. “At a time when the government is desperate for revenue, and America’s fuel prices are high, applying overly burdensome regulations would be bad public policy and could place an even bigger burden on Americans in the form of higher energy costs.

    API represents more than 500 oil and natural gas companies, leaders of a technology-driven industry that supplies most of America’s energy, supports 9.2 million U.S. jobs and 7.7 percent of the U.S. economy, delivers more than $86 million a day in revenue to our government, and, since 2000, has invested more than $2 trillion in U.S. capital projects to advance all forms of energy, including alternatives.

  125. Careful !!! Going against the Church of Obama {and the KKK} WILL produce retribution. House arrests, politically based assassinations, inquisitions, control of one’s job based on beliefs, suppression of Freedom of Speech, are on the horizon. When scientific analysis is deemed to be Scientific Truth, the slippery slope has been initiated.

    Watch for a CRISIS that will cause the unlimited issuing of Execution Orders [all ready happened??] This will be a created crisis, say, Oil/Nuclear Iran, economic embargo, war??

  126. Alec Rawls says:
    March 19, 2012 at 8:29 pm
    Vangel claims that for tar sands and oil shale “the positive return on the energy invested is very small,” and that “this is why the actual production of oil has not changed much since 2005.”

    I do not dispute this. It is most of the rest of what you have written that I have a problem with.

    Actually, some of the methods of extraction very promising. Shell’s experiments with in-situ conversion of oil shale into refined and semi-refined products found a quite high rate of energy efficiency:

    ICP requires energy input for heating, freeze wall construction, processing, and maintenance but still generates three to four times as much net energy as it consumes. This energy ratio is very comparable to steam injection in heavy oil projects. [Page 4-22 here.]

    At this rate of conversion, the present estimates of 800 billions bbls of shale oil would yield 600b bbls of oil. Is this what Vangel means by a “very small” return?

    Yes it is. The people at Shell told me that they have dropped the project because it makes no economic sense. Note that I have been following this plan since the early 1980s and have yet to see anything viable even though 30 years have passed.

    So why has “the actual production of oil has not changed much since 2005″? That’s obvious. The Democrats haven’t allowed development to proceed. George W opened up oil shale leases and permits but before they could come through the pipeline Obama shut them back down. He even shut down research.

    This is not true. We are talking about GLOBAL oil production and a period during which Bush was also in office. The price increases attracted hundreds of billions in new investment in all kinds of conventional and unconventional projects. But all that investment has yet to get global production to go up because at the low energy returns the cost of marginal production is very close to the world price and there isn’t enough capital for many of the projects to be completed on time and on budget.

    None of which bears one way or the other on the fact that Obama seems to have abandoned the supposed danger of CO2 as a rationale for his energy policies.

    The politics does not change the physics. No matter who is in office shale gas will still be unprofitable. I suggest that you stop looking at the hype and that you look at the actual data. The 10-Ks would be a good place to start because it is hard to make the cash flow statements hide the truth. Listening in on the conference calls may also be instructive if you pay attention. When you do listen try to figure out why such promising activities require so much injection of new capital years after the companies began operations and after they had the benefit of learning from earlier mistakes.

  127. ElmerF says:
    March 19, 2012 at 8:29 pm

    As a parting shot, Vangel Vesovski says: “The claims of recoverable reserves are not actually supported by the production data.” Wrong, Wrong, Wrong. Want an example, just look at the relatively quick change in natural gas supplies in the last decade or less.

    Nonsense. You need to look at the cash flows and profits. Or pay attention to the comments made by the CEOs. They don’t want to drill for gas but have to because if they did not the companies would have to write down the ‘value’ of the leases that they carry on their balance sheet. If they did that they would be bankrupt because there isn’t any capital to handle the change. Take a look at the 10-Ks and ask yourself why companies that have been producing shale gas for half a decade or more are unable to self finance their activities.

  128. And this is why the actual production of oil has not changed much since 2005 even though hundreds of billions in new investment has helped develop new fields.
    ——
    The Alberta government disagrees with you:…

    I am talking about GLOBAL production of oil. If hundreds of billions of new investment has not been able to get the total production level to rise materially since 2005 you have to doubt the narrative being spun above.

    Why is it that readers on this site have a healthy distrust of models and official pronouncements when it comes to climate but are eager to buy models and official pronouncements when it comes to estimates about energy? Why not take a look at the real world data and examine the SEC filings and the production data?

    While I am at it let me also point out that even the total production data is not very clean. Most people seem to think of one barrel of oil as the same as another but that is clearly not the case. To have production stay equal in real terms the decline of each barrel of light sweet would have to be made up by more than one barrel of unconventional oil or heavy sour. The reason should be obvious. We consume the end products, not the barrels of crude. As such we have to ensure that our supply of final products is properly accounted for. When we replace a barrel of light oil with heavy oil we get a lot less gasoline and kerosine and a lot more asphalt and bunker oil. To properly account by value we need more than one barrel of heavy oil for each barrel of light oil.

  129. @Tiger Woods Leg
    >>As for Hansen, I will be amazed if he holds his job after the election, the issue for Obama is if he moves Hansen now the left will go insane before the election.<<

    Hansen will hold his job for as long as he continues to be USEFUL to whatever political regime is in office after the election. It could just as easily be a Republican regime as a Democrat regime. Control of energy production and distribution, carbon credit trading and carbon taxes potentially serve the needs of quite a few people regardless of their politics.

  130. You are far behind the times in terms of the on-going shift in world energy production. We are seeing a paradigm shift. There is a huge amount of energy production about to break out from politically stable portions of the world, not just the USA.

    Consider the geo-political implications if Israel becomes a Saudi class Oil exporter of light sweet crude at $35-$45 a barrel, and a major Natural Gas exporter, in about 7-years.

    I am sorry but I thought that we were discussing the real world. There is no major shift of energy production. Hundreds of billions in new investment were not able to cause global crude production to increase materially over the 2005 levels. Spare capacity levels have fallen to historically low levels (days of use). While there SHOULD be plenty of undeveloped conventional gas in the Middle East, Mexico, Indonesia, Venezuela, and a few other locations its development will take time and will not be quick enough to offset the decline of production in conventional oil fields. While tar sands production should be viable (I hope it is given the amount that I have invested in it) shale production is still very uneconomic in most shale formations.

    Israel should have some oil and gas but nowhere near what the US, Russia, or Saudi Arabia had. And the last time I looked it was not exactly stable politically.

  131. Spector says:
    March 20, 2012 at 1:01 am

    The point is that all the extra processing takes energy. That is why we/they have never exploited these resources before…….

    Torgeir Hansson says:
    March 20, 2012 at 2:26 am

    For the Senate, the Republicans had the majority from 1981-86, 1995-2000, 2003-06. Let’s look at the period between 1995 to 2006. During that time oil production fell every year. EVERY year.
    ===========================================================

    Guys, I don’t think you know how things work, or what has already been done. And, you’re not listening. Your talking points have already been addressed. The reason why we haven’t exploited the oil that’s there is because of the same enviro-nutjobs that are blathering so much about CO2. Spector, the sand oil Canada is trying to sell us….. don’t you think they understand EREOI ? Torgeir, in spite of what you believe about how the U.S. political system works, it isn’t that easy to say so and so was president and could have drilled if we wanted to. It doesn’t work that way. Oil companies have been trying to get to ANWR for years. Further as technology increase so to does the ability to extract more oil in an energy positive manner.

    For decades the lunatic greens have thwarted U.S. energy production at every turn. I’ve offered these already, but, perhaps you’ve missed it.

    Go here for the economic viability of extracting shale oil. http://www.rand.org/pubs/monographs/2005/RAND_MG414.pdf I don’t think you understand that our available oil and gas has already been identified as sufficient. Go here http://www.europeanenergyreview.eu/site/pagina.php?id=3316

    • The reason why we haven’t exploited the oil that’s there is because of the same enviro-nutjobs that are blathering so much about CO2. Spector, the sand oil Canada is trying to sell us….. don’t you think they understand EREOI ? Torgeir, in spite of what you believe about how the U.S. political system works, it isn’t that easy to say so and so was president and could have drilled if we wanted to. It doesn’t work that way. Oil companies have been trying to get to ANWR for years. Further as technology increase so to does the ability to extract more oil in an energy positive manner. For decades the lunatic greens have thwarted U.S. energy production at every turn. I’ve offered these already, but, perhaps you’ve missed it. Go here for the economic viability of extracting shale oil.

      We have looked at the literature. Most of the arguments for shale viability are based on models and assumptions, not the actual production data and accounting. As I said, we heard the shale gas hype for about a decade and have yet to see the producers being able to self finance. If that is not a red flag for you I don’t know how you can pretend to be looking at the issue rationally.

      Yes, politicians can get in the way. But if they do not you still will not be able to produce shale gas economically and all but the best shale oil targets will lead to losses. That is the reality as it is, not as you may wish it to be.

  132. Please note that Dr. Chu did NOT recant his previous views. What he said was (to paraphrase) we CURRENTLY are in a difficult economic environment and it would not be helpful to increase gas prices NOW. (He probably also got a lecture about election year politics from the WH.)
    A reasonable followup question would have been: “So when the economy recovers, do you think gas prices should then be raised European levels?” I think that would have elicited a little dance.

  133. Crispin still in Johannesburg says: @ March 20, 2012 at 12:28 am

    ….One more thing, the chart of reserves is laughable as a picture of available energy. Africa is barely explored and it seems every time someone trips over a mango tree root, oil pops up. Keep your eye on the Congo basin.
    ____________________________________
    AH! Maybe that is another reason for the land grab going on in Africa right now. I just thought it was food, but now that I think about it, valuable resources under the land are another very good reason especially when there are absolutely no environmental laws to worry about.

    The African Land Grab
    African Land Grab – “Acres for a bottle of Scotch”

    Claims of African ‘land grab’ spark controversy

    World Bank policies “enabling” African land grab

    US universities in Africa ‘land grab':Institutions including Harvard and Vanderbilt reportedly use hedge funds to buy land in deals that may force farmers out

    African land grab threatens food security: study

  134. vangelv says:
    March 20, 2012 at 7:17 am (Edit)
    Granted there is no US crude excess at the moment, but it wouldn’t take long to change that. We used to supply the world with oil – remember?

    That was a long time ago and will never come back. We have to be realistic about what we see, not depend on models and pronouncements not supported by actual data. By now you should realise that the shale gas story was little more than hype. Producers needed $7-$9 per Mcf gas but were stuck drilling even when prices fell to less than $4 per Mcf. While that was great for consumers of gas it destroyed capital and blew up the balance sheets. We are now expected to forget the shale gas fiasco and believe that shale liquids will somehow be very different. But the truth is found in the 10-K cash flow statements and footnotes, not in narratives from people who missed the shale gas story because they didn’t understand what was going on.

    —————————————————————————————————————————

    You seem to be an investment type who has taken great care to understand the investment climate in carbohydrates of various types. Your analysis runs counter to the picture painted recently published document hy CitiGroup of Feb 15th this year called “Resurging North American Oil Production and the Death of the Peak Oil Hypothesis” and you make various points based on your intimate relationship with annual reports and CEO statements.

    So far so good.

    Then you make a statement that it is cheaper for the drilling/extraction companies to operate uneconomic assets at a huge loss rather than lose those same assets. That has me puzzled, particularly in light of the fact that these facilities have caused the price of gas to fall precipitously.

    That’s hard to understand at a number of levels but then I am not investing so perhaps I need to sharpen my thinking. There must be some explanation as to why a company would deliberately throw shareholder funds down the hole of a useless asset in an effort to hold onto that same useless asset.

    I got nothin’

    • You seem to be an investment type who has taken great care to understand the investment climate in carbohydrates of various types. Your analysis runs counter to the picture painted recently published document hy CitiGroup of Feb 15th this year called “Resurging North American Oil Production and the Death of the Peak Oil Hypothesis” and you make various points based on your intimate relationship with annual reports and CEO statements. So far so good. Then you make a statement that it is cheaper for the drilling/extraction companies to operate uneconomic assets at a huge loss rather than lose those same assets.

      That is not exactly what I said. I pointed out that if the companies wrote down their ‘reserves’ to reflect reality they would go bankrupt. Any investor understands that such a position leaves management a very clear choice. It can choose to admit reality and stop getting paid or keep playing the game for as long as possible. If you were a CEO who could make $30 million over the next 15 years before you retire why not keep playing the game and wind up with $60 million in compensation over the next two years even if that means bankruptcy and more money lost?

      That has me puzzled, particularly in light of the fact that these facilities have caused the price of gas to fall precipitously.

      That is my point. If you look at the production data and calculate the average likely ultimate recovery that is based on the decline curves you find that it is about half the reported EUR. That means that if you are the CEO you figure out that instead of a $4.50 per Mcf break-even value you need $9 per Mcf just to keep the wheels spinning. Now you could do the honourable thing and write down the reserves. But that leaves your balance sheet in ruins and wipes out all shareholder equity. Everyone gets fired and you stop getting paid.

      Why do that when the SEC gives you several ways to salvage as much as you can? For example, the US has no NI 43-101 equivalent. Shale gas producers can claim reserves based on estimates that may not be anywhere close to reality. It allows companies to guess and come up with EURs out of thin air. And best of all when reporting the boe figure it allows the use of the six to one energy content ratio instead of the 25+ to one price ratio. When you put it all together these rules permit shale gas producers to have value to conventional oil and gas companies that have a reserve depletion problem. By paying up for worthless gas reserves these companies can hide the fact that production is reducing their per share reserves. This allows the market to value their shares at a higher multiple than it would otherwise and allows the management to use their overvalued shares to purchase companies with conventional reserves at artificially low prices. The problem is that this game does nothing to add to the actual reserves that we need to keep the game going in the real economy. And in case that I have not been clear, that is my primary concern here.

      That’s hard to understand at a number of levels but then I am not investing so perhaps I need to sharpen my thinking. There must be some explanation as to why a company would deliberately throw shareholder funds down the hole of a useless asset in an effort to hold onto that same useless asset. I got nothin’

      Careful. All you need to do is to look at the motivation. There is no ‘a company’ when making decisions. It is just the management of that company. And management likes to get paid. (Look to the CDS or CDO markets for a great example of why operations that were doomed to fail kept going for quite some time.) And as I wrote above, the SEC rules give people who understand the game a great leeway to play it for their benefit. If you have a lot of cash flow and are profitable spending $5 billion on worthless shale gas reserves that will increase your market cap by $15 billion and allow you to buy real reserves at a lower price seems like a pretty good strategy for you and your shareholders.

      Keep in mind that even after the bubble bursts the conventional producers who bought worthless reserves will benefit because the damage done by the write-down of those reserves will pale in comparison to the benefit that comes with the exploding prices and higher cash flows and profits.

  135. Shale gas is not limited to the USA.

    The Fracking revolution has arrived in the UK.

    And the same Warmist clique is against it there like in the USA.

    http://blogs.telegraph.co.uk/news/jamesdelingpole/100106839/watermelons-v-the-shale-gas-miracle/

    Watermelons v the Shale Gas Miracle
    By James Delingpole Politics Last updated: September 23rd, 2011
    198 Comments Comment on this article

    Caroline Lucas by Fenbeagle

    God knows we could all do with some good news right now. And as it happens, from Oop North near Blackpool this week, we had good news in spades.

    Sure, it was known Britain was sitting on some pretty sizeable shale gas deposits. What hadn’t been announced before though, was just how sizeable.

    An area in northwest England may contain 200 trillion cubic feet of shale gas, putting it in the same league as some of the vast shale-gas plays that have transformed the U.S. energy industry.

    The figure for the area near Blackpool, released Wednesday by Cuadrilla Resources, a small oil-and-gas company with operations in England’s Bowland Shale, highlights the U.K.’s emerging position as a new frontier for unconventional gas exploration.

    I said “good news” but that seriously understates the case. It may be the best thing to happen to the British economy since the discovery of North Sea oil and gas; possibly since the Industrial Revolution. Those who’ve been following the story closely such as Nick Grealy at the
    No Hot Air blog understand this perfectly well:

    [*]No doubt about it, the numbers are not so much game changing as jaw-dropping. These figures surprised everyone, but they didn’t surprise readers here as much. The experience world wide of shale shows that initial “expert opinion” expectations of potential and actual production have been consistently pessimistic at best and generally down right wrong.

    And even more amazingly, this may be just the tip of the iceberg. I hear reports that the shale gas deposits in the North East of England may be larger still; and that those under the North Sea may dwarf even these. We are talking, in other words, of cheap energy sufficiently abundant to supply our needs for at least the next century, possibly much longer. This means in turn that our industry will become more competitive, the cost of heating and lighting our homes will fall dramatically, and that our economy suddenly now has an opportunity to grow even as those in much of the Western world are collapsing.

    So why aren’t we out on the streets, celebrating, drinking and rutting like it was VE Day all over again?

    In a word: Watermelons.

    You may have seen the episode of the Daily Politics where I accused Green MP Caroline Lucas of being a “watermelon” and she admitted she was proud to be one – “green on the outside, red on the inside.” Well we should be grateful for her honesty, I suppose. But is this really what we need right now as our economy stands on the brink of the Greater Depression: outspoken, publicity-hungry politicians who consider it their bounden and sacred duty to put whatever obstacles they can in the way of economic growth – all in the name of combating that increasingly discredited chimaera, “climate change”?

    Lucas clearly thinks so, as she shows in her latest article for Komment Macht Frei (Grüne Abteilung). Drilling, she insists, must be postponed indefinitely, because someone somewhere might derive some economic benefit from it – and that would be just plain wrong.

    With pound signs in his eyes, Cuadrilla’s chief executive says he was “excited” by the find. I am not. And neither are the many hundreds of environmental campaigners and local people who are fighting the government’s apparent determination to allow the exploitation of every last bit of fossil fuel from below our feet.

    I think she might be pushing a bit with that “many hundreds”. “Dozens”, possibly, though it’s interesting to note that even at the Guardian the majority of commenters below her article appear to be either cautiously in favour of further exploration or downright cynical about Lucas’s doom-cult ideology.
    My favourite is the one that says:

    Gaia, in all her wisdom, has seen fit to give us the gas finds at Blackpool.
    Much as I respect the views of Ms Lucas, I must accept Gaia’s sacred plan.

    Lucas is not, of course, the only Watermelon standing in the way of economic recovery. The biggest and most dangerous by far is the impossible Chris Huhne:

    The UK’s “dash for gas” will be halted by the government because if unchecked it would break legally binding targets for carbon dioxide emissions, Chris Huhne, energy and climate change secretary, said on Monday evening.

    Well he may think that now. But I do wonder whether his Coalition colleagues will feel quite so enamoured of this principled stance to progress, economic growth, cheap energy, and inflation-reduction as the depression deepens, the weather gets colder, the landscape is ruined by more and more wind farms, and energy bills continue their exponential rise.
    One thing’s for certain. No longer is there any excuse for anyone to write sympathetic pieces about George Osborne arguing that there is no magic bullet available in his armoury to save the British economy. Against all the odds, that magic bullet has just been handed to him on a plate. All he has to do is call a halt to Britain’s economically suicidal drive for “renewable energy”, cancel immediately Britain’s disastrous wind farm building programme, and give the green light to shale gas drilling. It won’t even cost the taxpayer any money. The cheap energy is there. The jobs are there. If he doesn’t grab this miraculous opportunity with both hands, history will never forgive him.
    Oh incidentally it has come to my shocked attention that I am speaking at the Soho Literary Festival tomorrow on this very subject: Watermelons. Even though I haven’t prepared anything I’m sure I’ll be very good and would welcome your support, if any of you happen to be in central London and at a loose end around 5.45pm on Saturday evening. Maybe see you there?

  136. Torgeir Hansson says:

    “European governments tax oil to regulate behavior, just like we tax cigarettes to regulate behavior. Same thing.”
    ————————————–
    Smokey says: @ March 20, 2012 at 1:17 am
    Yes, same thing, Mr Hansson: for MONEY. But regulating behavior has nothing to do with it; that’s just the cover story. Political greed is the motive.

    Governments don’t give a damn about people, except insofar as people are taxpayers. Oil is taxed for MONEY, and cigarettes are taxed for MONEY….
    —————————————–
    Very true that was what the Federal Reserve act of 1913 and the 16th Amendment to the U.S. Constitution—the federal income tax amendment— also ratified in 1913 was all about. MONEY, coming up with a “Legal” method to steal wealth from American citizens. Also the income tax was a method of making the American people accept bank script. What makes the universal acceptance stick is that government accepts its own money to expunge liabilities to it. In plain English, fiat money has value because it is the only money you can use to pay taxes.

    Politics always boils down to power and wealth. Very Very few politicians are honest and those that are end up driven from office, ridiculed or as a last resort shot or poisoned.

    Power and wealth also drives the owners of the printing presses who control what a journalist may or may not print. We at WUWT have seen ample evidence of that.

  137. vangelv,

    You really need to check out the chart at the link:

    http://www.chron.com/business/energy/article/N-American-oil-output-could-top-40-year-old-peak-2193837.php

    The title in the text says it all:

    The Oil Boom is Here

    North America appears headed for an oil renaissance, with crude production expected to hit an all-time high by 2016, given the current pace of drilling in the U.S. and Canada, according to a study released by an energy research firm this week.

    U.S. oil production in areas including West Texas’ Permian Basin, South Texas’ Eagle Ford shale, and North Dakota’s Bakken shale will record a rise of a little over 2 million barrels per day from 2010 to 2016, according to data compiled by Bentek Energy, a Colorado firm that tracks energy infrastructure and production projects.

    Canadian crude production is expected to grow by 971,000 barrels per day during the same period, with much of the oil headed for the U.S.

    Combined, the U.S. and Canadian oil output will top 11.5 million barrels per day, which is even more than their combined peak in 1972.

    Goldman Sachs has estimated the U.S. could move from being the No. 3 oil producer behind Saudi Arabia and Russia to the No. 1 spot by 2017.

    It’s a reversal of the steady downward production trend that started after 1971, when U.S. oil production peaked around 9.5 million barrels per day.

    And the pace of production now has caught quite a few people by surprise, says Joseph Pratt, a historian at the University of Houston who has written extensively about the oil and gas industry.

    “We have this momentum out there to set about doing what we said we wanted to do back in the 1970s: reduce the flow of imports from volatile regions,” Pratt said. “It was like the Holy Grail back then. And suddenly it seems possible.”

    The surge is fueled by the same drilling and production techniques that opened up natural gas production in recent years – the combination of horizontal drilling and hydraulic fracturing – as well as the success of deep-water Gulf of Mexico projects and the ramp-up of Canadian oil sands projects.

    The natural gas glut has kept its price low, prompting producers to focus more effort on oil and natural gas liquids, which fetch better prices.

    Earlier this year, the number of land and offshore oil rigs working in the U.S. exceeded the number of natural gas rigs for the first time in 18 years, according to data compiled by IHS-CERA.

    And Texas oil and gas industry employment returned to its pre-recession highs in June, according to the Texas Petroleum Index, topping the last boom that peaked in October 2008, thanks largely to oil drilling.

    The oil boom has plenty of economic upside potential. IHS-CERA predicts oil production could directly and indirectly generate another 1.3 million U.S. jobs over the next decade and raise an additional $97 billion in federal taxes and royalty payments.

    But plenty of people are concerned about the other costs that might come with more oil production.

    The proposed Keystone XL pipeline, a major project to bring Canadian oil sands to U.S. Gulf Coast refineries, has become a rallying point for environmentalists, with hundreds arrested during a sit-in in front of the White House several weeks ago.

    And the Environmental Protection Agency is moving forward with new rules aimed at tighter controls on emissions from oil and gas drilling, production and transportation.

    The industry contends the proposed rules put a costly burden on a job-creating industry at a time when the country needs jobs.

    But Daniel Weiss, a senior fellow at the Center for American Progress, a liberal-leaning think tank, said the industry is far from being hobbled financially. He noted that the five oil majors – Exxon Mobil, Shell, BP, Chevron and ConocoPhillips – have reported $67 billion in 2011 profits and are sitting on $60 billion in cash. Yet they have cut more jobs than they’ve created in recent years and spent billions buying back their own stock, Weiss said.

    Pratt predicted that tensions among the resurgent oil industry, community groups and environmental groups – heightened by last year’s Deepwater Horizon accident and oil spill – will continue.

    The conflict was manifest in public hearings Monday in Port Arthur, where federal officials took comments on the Keystone XL pipeline project, Pratt said.

    “The first 25 speakers were union workers and locals saying they needed the jobs the pipeline would bring. Then the bus from Houston pulled up, and the environmental groups spoke about how it’s the filthiest oil in the world,” Pratt said.

    “All of them had passion about their point of view, but there are questions of fairness and justice and economics that we just don’t know how to talk about.”

    tom.fowler@chron.com
    twitter.com/houstonfowler

    • vangelv, You really need to check out the chart at the link: http://www.chron.com/business/energy/article/N-American-oil-output-could-top-40-year-old-peak-2193837.php The title in the text says it all: The Oil Boom is Here North America APPEARS headed for an oil renaissance, with crude production expected to hit an all-time high by 2016, given the current pace of drilling in the U.S. and Canada, according to a study released by an energy research firm this week.

      Sorry but the same was said of shale gas. But when production of shale gas went up the producers had to pile up debt. They wound up destroying capital and the last time I checked, capital destruction was not a way to prosperity for investors, consumers, or the nation.

      Now you could argue that shale oil will be much better than shale gas but I just don’t buy it. As I said above, if you have wells in the sweet spots of the best formations you could make a lot of money. But the discussion isn’t about unique locations but about the total output from all shale formations. If we look at the production data we find that the costs are still too high to ensure a profit for the average producer.

      You also need to keep in mind that if we used horizontal wells in conventional fields before they peaked we would be looking at production rates that were above 10,000 bpd and depletion rates that were quite manageable, not IRs of 1,200 bpd that fell to 80 bpd within a year along a hyperbolic curve.

      U.S. oil production in areas including West Texas’ Permian Basin, South Texas’ Eagle Ford shale, and North Dakota’s Bakken shale will record a rise of a little over 2 million barrels per day from 2010 to 2016, according to data compiled by Bentek Energy, a Colorado firm that tracks energy infrastructure and production projects.

      That may be true but I don’t see how that happens with the huge depletion rate. Note that the average Bakken well is producing less than 100 bpd even though most of the old wells are now shut-in and most of the newer wells have been drilled in the past 3 years in the most promising areas. That makes me still a skeptic and I will remain one until I see positive cash flows that allow the shale players to self finance.

      Canadian crude production is expected to grow by 971,000 barrels per day during the same period, with much of the oil headed for the U.S. Combined, the U.S. and Canadian oil output will top 11.5 million barrels per day, which is even more than their combined peak in 1972.

      Most of the actual Canadian production will come from the tar sands. I am not disputing the viability of those projects although if you have been paying attention to all of the unscheduled shut-downs you will find that things are not going as smoothly as they were expected.

      Goldman Sachs has estimated the U.S. could move from being the No. 3 oil producer behind Saudi Arabia and Russia to the No. 1 spot by 2017.

      It will never happen when your average well costs $5-$7 million to drill and is producing less than 100 bpd within a year or two. We live in the real world and down here we can’t ignore depletion or the lack of capital.

      And the last time I looked GS was telling people how great MBSs were even as it was making bets against them. It would not surprise me to see GS as the big winner after the shale gas and oil bubble bursts because it made bets against the money losing producers that it was promoting to speculators.

      It’s a reversal of the steady downward production trend that started after 1971, when U.S. oil production peaked around 9.5 million barrels per day.

      As I wrote above, chewing through capital is not a way to prosperity for investors. If the full cost of production is greater than the sale price the companies will continue to show funding gaps and will keep adding debt.

      And the pace of production now has caught quite a few people by surprise, says Joseph Pratt, a historian at the University of Houston who has written extensively about the oil and gas industry. “We have this momentum out there to set about doing what we said we wanted to do back in the 1970s: reduce the flow of imports from volatile regions,” Pratt said. “It was like the Holy Grail back then. And suddenly it seems possible.” The surge is fueled by the same drilling and production techniques that opened up natural gas production in recent years – the combination of horizontal drilling and hydraulic fracturing – as well as the success of deep-water Gulf of Mexico projects and the ramp-up of Canadian oil sands projects.

      LOL. Haven’t you noticed that the only reason that the US is less dependent on foreign oil is because of a collapse in demand in the real economy? Or that conventional production in Alaska and California is collapsing?

      The natural gas glut has kept its price low, prompting producers to focus more effort on oil and natural gas liquids, which fetch better prices.

      Why is this good news for shale gas producers that need $8 per Mcf to break even?

      Earlier this year, the number of land and offshore oil rigs working in the U.S. exceeded the number of natural gas rigs for the first time in 18 years, according to data compiled by IHS-CERA. And Texas oil and gas industry employment returned to its pre-recession highs in June, according to the Texas Petroleum Index, topping the last boom that peaked in October 2008, thanks largely to oil drilling.

      The only reason that the natural gas rigs have fallen is because the skeptics who questioned the shale gas hype were right and those that were doing the hyping were wrong. Why should we turn away from the skeptics who were right and listen to the same group of con men who were wrong before?

      The oil boom has plenty of economic upside potential. IHS-CERA predicts oil production could directly and indirectly generate another 1.3 million U.S. jobs over the next decade and raise an additional $97 billion in federal taxes and royalty payments.

      About five years ago CERA, IEA and EIA were arguing for a depletion rate of around 4% while the skeptics were pointing to data that implied that the true depletion rate was at least 2-3% higher. After the IEA looked more carefully it found that CERA was wrong and the skeptics were right. CERA was hyping shale gas but that turned out to be a big bust for investors looking to finance activities that would generate reasonable economic profits.

      But plenty of people are concerned about the other costs that might come with more oil production. The proposed Keystone XL pipeline, a major project to bring Canadian oil sands to U.S. Gulf Coast refineries, has become a rallying point for environmentalists, with hundreds arrested during a sit-in in front of the White House several weeks ago. And the Environmental Protection Agency is moving forward with new rules aimed at tighter controls on emissions from oil and gas drilling, production and transportation. The industry contends the proposed rules put a costly burden on a job-creating industry at a time when the country needs jobs. But Daniel Weiss, a senior fellow at the Center for American Progress, a liberal-leaning think tank, said the industry is far from being hobbled financially. He noted that the five oil majors – Exxon Mobil, Shell, BP, Chevron and ConocoPhillips – have reported $67 billion in 2011 profits and are sitting on $60 billion in cash. Yet they have cut more jobs than they’ve created in recent years and spent billions buying back their own stock, Weiss said.

      Note that those companies made their money from conventional production, not shale or tar sands?

      Pratt predicted that tensions among the resurgent oil industry, community groups and environmental groups – heightened by last year’s Deepwater Horizon accident and oil spill – will continue. The conflict was manifest in public hearings Monday in Port Arthur, where federal officials took comments on the Keystone XL pipeline project, Pratt said. “The first 25 speakers were union workers and locals saying they needed the jobs the pipeline would bring. Then the bus from Houston pulled up, and the environmental groups spoke about how it’s the filthiest oil in the world,” Pratt said. “All of them had passion about their point of view, but there are questions of fairness and justice and economics that we just don’t know how to talk about.” tom.fowler@chron.com twitter.com/houstonfowler

      The environmental groups are a pain in the butt but even if they went away the production of shale gas or liquids would not be profitable. Of course, if they did go away the Mackenzie River deposits could be brought to market and help to lower prices a little. (If that ever happens I would look to see if Franco Nevada still holds the royalties.)

      Bottom line is that the quoting of hype pieces is not a valid argument. As I wrote before, if you want to see what is going on take a look at the 10-K filings with the SEC and examine the cash flows and debt levels.

  138. The USA is awash in inexpensive “fossil” fuels that can be burned cleanly and profitably. Glad that was pointed out in the article.
    MP Biomass is one company with a system for coal that does make it clean and is in production and being used.
    If that still doesn’t convince people to use it then I’ll know they are serious about “change” when they put up half a billion for LFTR development. That is the same amount they lost on Solyndra.

  139. Vangelv,

    Israel as a gas producer is a 2013 inevitability.

    Israel as a oil producer is 4-6 years down the road.

    Israel as an expeorter of Natural Gas is going to depend on how fast Israeli infrastructure switches from oil to domestic natural gas for both balance of trade and security reasons. Israeli electrical production will be foreign oil free by 2016 at the outside.

    Many people really don’t want to look at the foreign policy implications of a Jewish oil state that is INDEPENDENT OF US FOREIGN AIDE and sells both natural gas & light sweet crude to Europe in lieu of Russia and the Arab oil states respectively.

    See:

    http://www.jpost.com/Features/FrontLines/Article.aspx?id=211676

    How Israel could revolutionize the global energy sector
    By DORE GOLD
    03/11/2011

    New data suggests Israel may not only have much larger gas resources than believed, but also the 3rd largest deposit of oil shale in the world.

    Libyan oil accounts for less than 2 percent of world oil production, yet the revolt against Muammar Gaddafi has managed to shoot up the price of oil to more than $100 per barrel in the last month.

    No one knows how long the internal instability in the Middle East will last, but according to the US Department of Energy, its share of the world’s total oil supply is expected to actually increase in the years ahead.

    Simply, the world is using up the reserves of non- Middle East oil more quickly. Moreover, of the trillion barrels of proven reserves still left, according to the CIA roughly 800 billion barrels are to be found in the Middle East and North Africa, especially in Saudi Arabia, Iran and Iraq.

    The implications for Israel of the West’s growing dependence on Middle Eastern oil are troubling, for obvious reasons. Yet there are two new developments in our energy sector that could well offset these trends and eventually alter our standing in the world, especially with respect to Europe.

    First, the gas discoveries in the Eastern Mediterranean, which began to produce commercial quantities of natural gas in 2004, are generally well-known. The Tamar field, which should begin production in 2013, is expected to supply all of Israel’s domestic requirements for at least 20 years. The Economist suggested in November 2010 that the recently discovered Leviathan field, which has twice the gas of Tamar, could be completely devoted to exports.

    All the undersea gas fields together have about 25 trillion cubic feet of gas, but the potential for further discoveries is considerably greater, given that the US Geological Survey estimates that there are 122 trillion cubic feet of gas in the whole Levant Basin, most of which is within Israel’s jurisdiction.

    After the Leviathan discovery these numbers could go up further. Perhaps for that reason, Greece has been talking to Israel about creating a transportation hub for distributing gas throughout Europe from the Eastern Mediterranean that will come from undersea pipelines.

    What is less well-known, but even more dramatic, is the work being done on this country’s oil shale. The British-based World Energy Council reported in November 2010 that Israel had oil shale from which it is possible to extract the equivalent of 4 billion barrels of oil. Yet these numbers are currently undergoing a major revision internationally.

    A new assessment was released late last year by Dr. Yuval Bartov, chief geologist for Israel Energy Initiatives, at the yearly symposium of the prestigious Colorado School of Mines. He presented data that our oil shale reserves are actually the equivalent of 250 billion barrels (that compares with 260 billion barrels in the proven reserves of Saudi Arabia).

    Independent oil industry analysts have been carefully looking at the shale, and have not refuted these findings. As a consequence of these new estimates, we may emerge as the third largest deposit of oil shale, after the US and China.

    OIL SHALE mining used to be a dirty business that used up tremendous amounts of water and energy.

    Yet new technologies, being developed for Israeli shale, seek to separate the oil from the shale rock 300 meters underground; these techniques actually produce water, rather than use it up.

    The technology will be tested in a pilot project followed by a demonstration stage. It will be critical to demonstrate that the underground separation of oil from shale is environmentally sound before going to full-scale production. The present goal is to produce commercial quantities of shale oil by the end of the decade.

    This particular project has global significance.

    For if Israel develops a unique method for separating oil from shale deep underground, that has none of the negative ecological side-effects of earlier oil shale efforts, that technology can be made available to the whole world, changing the entire global oil market. The effect of the spread of this technology would be to shift the center of gravity of world oil away from Iran, Saudi Arabia and the Persian Gulf to more stable states that have no history of backing terrorism or radical Islamic causes. (In the Arab world, Jordan and Morocco have the most significant oil shale deposits.) WHEN WILL the West begin to treat Israel as a powerful energy giant and not as a weak client state that must be pressured? In the case of the Saudis, when the US realized the true extent of their oil reserves, after America’s reserves in Texas and Oklahoma were depleted by World War II, it sought to upgrade its military and diplomatic ties with the Saudi kingdom even before its production capacity was fully exploited. The US-Saudi connection grew as massive infrastructure investments for moving Saudi oil to Western markets were made, like the Trans-Arabian Pipeline (TAPLINE).

    More capital was needed for the Saudi oil project. US companies, like Standard Oil of New Jersey (today, Exxon) and Standard Oil of New York (Mobil), joined Texaco and Standard Oil of California, the original holder of the Saudi oil concession, and created the ARAMCO consortium in the late 1940s. ARAMCO executives came to be regular guests at the State Department, where they could present the Saudi perspective.

    In time, Saudi Arabia’s status grew as its future position in world oil came to be appreciated.

    In the case of Israel, updated international reports verifying the true dimensions of both its undersea gas and oil shale should be forthcoming in the next year.

    Many more international companies are likely to take an interest in its energy sector at that time. Moreover, the full exploitation of these energy resources will require massive infrastructure investment for pipelines, liquified natural gas plants and new oil exporting outlets in the Mediterranean and Red Sea.

    Israel is uniquely situated by its geographical position and is able to direct its energy exports to either Europe or China and India. It may not have the capital to build this export capacity, but the involvement of foreign investors in these projects will give European and American banks new interests in developments.

    Western policies will not change overnight. Nonetheless, Israel needs to tell the full story of its newly emerging role in the world energy sector if it wants to begin to alter the way it has been handled internationally.

    The writer is president of the Jerusalem Center for Public Affairs and served as ambassador to the UN.
    ———-

    This link explains their technology in detail:

    http://en.m.wikipedia.org/wiki/Shale_oil_extraction explains it detail.

    • Vangelv, Israel as a gas producer is a 2013 inevitability. Israel as a oil producer is 4-6 years down the road. Israel as an expeorter of Natural Gas is going to depend on how fast Israeli infrastructure switches from oil to domestic natural gas for both balance of trade and security reasons. Israeli electrical production will be foreign oil free by 2016 at the outside…

      The conventional gas reserves are still very tiny. While they will help the country will still need to depend on imports a decade or two down the road.

      The rest of the story depends on shale production being economic and all of the evidence so far seems to point the other way. You can’t solve the energy problem by adding more and more debt and producing energy by investing the same amount or more into the production process.

      Once again, citing hype pieces is not a valid argument. You really should look at the actual production data and check reality by looking at the financing and cash flow reporting.

  140. I forgot to add this on the subject of taxes:

    “The Government Accountability Office said 72 percent of all foreign corporations and about 57 percent of U.S. companies doing business in the United States paid no federal income taxes for at least one year between 1998 and 2005. More than half of foreign companies and about 42 percent of U.S. companies paid no U.S. income taxes for two or more years in that period, the report said.” http://www.reuters.com/article/2008/08/12/us-usa-taxes-corporations-idUSN1249465620080812

    And this

    WASHINGTON — A recent analysis of the 2007 financial markets of 48 countries has revealed that the world’s finances are in the hands of just a few mutual funds, banks, and corporations. This is the first clear picture of the global concentration of financial power….
    http://www.insidescience.org/research/1.861

    In 1976 A typical American CEO earned 36 times as much as the average worker. By 2008 the average CEO pay increased to 369 times that of the average worker. http://timelines.ws/subjects/Labor.HTML

    No flies on those guys, they were not about to be shafted like the rank and file workers. The above is why Obama’s “Tax the rich” rhetoric is so very laughable. The very rich stuck their money in tax shelters a LONG LONG time ago and they are going to make sure it remains untaxable. That is why they pay bribes.

  141. Torgeir Hansson says:We have already covered the fact that new domestic oil production is not going to alleviate “ruinous energy prices,” especially when they are at about half of what Europeans pay.

    Question, what is the cost of gas in Europe and USA after you subtract taxes?

    Maybe not everyone will be surprised to know, gas is cheaper in Europe, but it’s the taxes that are killer!

  142. Torgeir Hansson says:
    March 20, 2012 at 1:33 am
    “Dear Smokey:
    Governments need money to function. You may not like it, but governments are the agents of the people. Both driving and smoking cost money to society, as there are cheaper alternatives.”
    ___________________________
    What a pony and cart? I live on a dirt road in the back end of nowhere the nearest civilization is 15 miles ~ a 30 mile round trip so that is about a two day journey for a pony and cart unless the animal is very fit. (This was part of a discussion on another board)

    I have done 20 -30 mile carriage drives and it leaves me and my animals half dead the next day so it is a subject I am familiar with BTW. It also take ALL day. So how the heck am I to drive to work if it takes me all day HMMMmmmm?

    Oh that is correct “Sustainable Communities” will stack humanity up on top of each other like logs and leave 1/2 of the country as a “Nature Preserve” So that must be what you are talking about when you say ” cheaper alternatives”

    This no doubt is your Dream of America’s future.
    Normal human use is allowed in the little green areas only: http://www.mtmultipleuse.org/wilderness/wildlands_map.htm

    The bill to turn that map into reality was defeated at the 11th hour but the eco-nuts have not given up they never do and that is why we are in the mess we are today.

    WILDLANDS PROJECT: http://www.mtmultipleuse.org/wildlands_project.htm
    Noss, who is generally more restrained than Davis states the goal thus: “I suggest that at least half of the land area of the 48 conterminous states should be encompassed in core reserves and inner corridor zones (essentially extensions of core reserves) within the next few decades.” Core reserves equals wilderness.

    List of bills http://www.klamathbucketbrigade.org/YNTKwildlandsproject_table.htm
    Newest try: http://www.freedomadvocates.org/articles/wildlands_project/wildlife_corridor_conservation_act_introduced_20100706416/

  143. Alex the skeptic says:
    March 20, 2012 at 3:35 am

    I just wish I can fake US citizenship and come and vote come November.
    ________________________________
    Not a problem.

    You head for a state with lenient voter ID laws. http://www.ncsl.org/legislatures-elections/elections/voter-id-state-requirements.aspx
    Then all you need is an easily obtainable US drivers license not US citizenship. All you have to do is ask the first illegal immigrant you find where you can get one /snark

    Illegal Immigrants Are Voting in American Elections
    …In 2005, the U.S. Government Accountability Office found that up to 3 percent of the 30,000 individuals called for jury duty from voter registration rolls over a two-year period in just one U.S. district court were not U.S. citizens….
    http://www.thecuttingedgenews.com/index.php?article=691

    Debate heats up over voter ID laws
    …Both sides are awaiting decisions from the U.S. Justice Department on whether new voter ID laws in Texas and South Carolina violate a section of the 1965 Voting Rights Act. Under the law, certain states with a history of discriminatory voting practices must get approval from Justice Department officials before making election changes.

    The department’s decision on the Texas law is due Dec. 5. Its decision on the South Carolina law is due Dec. 27. Mississippi will have to submit its plan to the department or to U.S district court in Washington.

    The Texas decision will be the first ruling on a voter ID law under the Obama administration….

    http://www.usatoday.com/news/washington/story/2011-11-10/voter-identification-laws/51159106/1

  144. The two things that can kill off the AGW scare are running out of money and running out of political will, with this will coming from their constituencies concern , the only countries where the latter does not matter, such as China , have not bought into the ‘scare ‘ in the first place .Which is why the fight is far more often done on the PR front than the science one when it come to AGW proponents.
    Its just reality that most people nether know the science nor frankly care about it , most people don’t put the effort into looking into the background . As fine a web site as this is , its still a echo chamber to those who self selected put the effort in.
    And that goes for both sides, but ‘the people ‘do care about their basic, such as has fuel cost, getting hit, they do notice the shrill alarmism, and best of all they do grow tired of constant messages of doom.

  145. vangelv,

    I don’t know which planet you are on. Please stop misleading people here. Shale Gas and Shale Oil are proven to be viable. This is FACT not hype. The only limitation is an economic one. At current oil prices shale oil is economic. At current North American gas prices – shale gas is not. At current European gas prices, shale gas is viable.

    FWIW – both Shale Oil and Shale Gas are by FAR cheaper than both Solar and Wind power (about one fifth the cost). As any intelligent person can see, barring the discovery of a new cheaper energy alternative, shale gas and shale oil will play an increasing role in the energy supply mix (and conventional fossil fuels like coal and oil and natural gas will continue to play a dominant role).

    Take off your tin foil hat!

    • vangelv, I don’t know which planet you are on. Please stop misleading people here. Shale Gas and Shale Oil are proven to be viable. This is FACT not hype…

      Take a look at the SEC filings and see how producers who have been in business for nearly a decade still can’t self finance their production.

      If shale gas were viable why is Chesapeake, the biggest promoter of shale gas, moving to shale liquids? Why can’t it self finance shale gas production? Of course, now that shale gas has failed miserably we are supposed to ignore that outcome and buy the same hype about shale liquids. Well, I for one prefer to be skeptical until I see the cash flows turn positive and see some of that massive debt paid down.

      Let me note again that the scam is not fraud. The shale producers are using the rules that the SEC put into place properly and are not hiding anything. Anyone who can look at a financial statement, reads the notes, and listens to the conference calls can see exactly what is going on. But as with the housing bubble people choose to ignore the reality and place their faith in narrative. (Just like AGW people that Anthony likes to point out.)

  146. Dr. Lurtz says:
    March 20, 2012 at 6:44 am

    …Watch for a CRISIS that will cause the unlimited issuing of Execution Orders [all ready happened??]….
    _______________________________
    Your a day late and a dollar short. The EO’s have been issued for a long time and Clinton gathered them all up into a nice neat package. A decidedly wacky extremist site has the actual EO numbers and a brief description of the orders listed : http://www.angelfire.com/hi/TWA800/clintoneo.html

    (Ain’t seach engines wonderful?)

  147. Torgeir Hansson says:
    March 19, 2012 at 9:39 pm

    “Hey guys! Isn’t it great to see that the Administration already is coming off its CAGW stance? I predicted this at least two years ago. Mr. Obama should be welcomed to the fold, not reviled as a liar.”

    Please don’t take this the wrong way: You may not be familiar with one P.T. Barnum, a Circus operator from an earlier era who said “There’s a Sucker born every minute”. Not long after, a Vaudevillian performer-turned-movie actor named W.C. Fields, taking note of Barnum’s observation, said “…and two to ‘take care’ of him.”. While I admire ‘optimism’ as a personality trait, Mr. Obama is here to ‘take care’ of you.

    For confirmation, just look at the careful calibration (changes in) of his rhetoric, and ABOVE ALL the repeated attempts to defer what will be politically disadvantageous to a point in time that will be after an election. . . so that implementation of The Agenda will not get him tossed out. Be very, very suspicious . . .

  148. Many here seem to not like Obama (and he’s not perfect), but when you hold your nose and vote you can’t seriously consider one of the current crop of brain dead Republican zombies.

  149. vangelv says:
    March 20, 2012 at 8:37 am

    But if they do not you still will not be able to produce shale gas economically and all but the best shale oil targets will lead to losses. That is the reality as it is, not as you may wish it to be.
    ==================================================================
    Vangely, that doesn’t make any sense. The Canadians are, at this moment moving their sand oil by train down to the U.S. Now, if they can dig in frozen ground and use essentially the same technology to gain oil, and move it by rail and still profit, don’t you imagine with less distance and an easier environment that we could do likewise? The fact of the matter is, unless we remove the obstacles, no one will know for sure.

    But, it is besides the point. There is no alternative. And, there won’t be for years to come, with the limited exception of the natural gas we’ve found around the world. So, regardless of your beliefs, we’ll get the oil, sooner or later, and it will be viable, because there is no alternative. Eventually, cost and demand will force the exploitation of the oil, and then you’ll see that all of this stammering and bluster about peak this and that was nothing but a heavily propagandized Malthusian talking point.

    • Vangely, that doesn’t make any sense. The Canadians are, at this moment moving their sand oil by train down to the U.S. Now, if they can dig in frozen ground and use essentially the same technology to gain oil, and move it by rail and still profit, don’t you imagine with less distance and an easier environment that we could do likewise?

      Please pay attention. I do not question the economics of tar sands production because the established producers can make a profit at the low prices that they are getting. Eventually, when a pipeline is built to British Columbia and the producers can get the world price for their oil they should do much better.

      It is the economics of shale that is the big problem right now. Shale gas producers have already abandoned the idea of making a profit from their activities and are trying to desperately convince speculators that shale oil will be different. For some it may be but I doubt that the average shale oil well will be profitable. There certainly is not much evidence of that so far.

      Let me note that I can be convinced if I see data that shows that I am wrong. But I have yet to see that data so far. Other than a few unique situations I do not see shale liquids as very promising at this time. And as I pointed out often, shale gas is a huge problem.

  150. The Oil Commodity market, like all markets, is an illogical, emotionally driven institution. Write a story about a Saudi pipeline busting and watch the panic. Remember about 3 years ago crude went to $150. There was no shortage, only speculation. If these speculators heard that the US was doubling it’s drilling permits, I submit, the price of crude would plummet.

  151. Torgeir says:

    I will not follow you into the assumption that this Administration is out to ruin the country. That is a toxic notion.

    I never suggested any such thing. Chu has been perfectly clear that he sees raising gas prices is essential to SAVING our country and the world. Please, in your quest to support and embrace Obama, do not misrepresent what other people are saying. It’s pretty trollish behavior, posing as someone who wants to give the benefit of the doubt while grossly mis-stating what other people have said.

    On the point itself, if you recognize that “European governments tax oil to regulate behavior, just like we tax cigarettes to regulate behavior,” why do you have difficulty accepting that the Obama administration is doing the same thing, not with taxes, but with their manipulation of prices by curtailing domestic energy development? They have been perfectly up front about this being their plan, and all of their actions have been in accordance with this plan. They want high energy prices in order to force people to use less oil, which they see as necessary to save the world from CO2.

    Now that the high prices are proving to be politically costly, they are pretending that they did not create them on purpose and they are hiding their anti-CO2 motivation, but if they really were no longer concerned about CO2 they would remove the artificial restrictions on domestic energy development.

  152. Vangel seems to be looking at the issue in terms of his own investment experience, focusing on the issue of profitability:

    we heard the shale gas hype for about a decade and have yet to see the producers being able to self finance. If that is not a red flag for you I don’t know how you can pretend to be looking at the issue rationally.

    But profitability does not tell the tale. If producers are not making money, it is because the glut of supply has driven natural gas prices down to the level of production costs. Markets always experience such fluctuations. Just ask farmers. In a good growing year, nobody makes any money because the glut of supply makes the bottom fall out of market prices.

    The criterion to look at is production cost. That is what underlies the industry supply curve. For a given market price, that energy will be supplied that can be sold for more than the cost of production (plus, in long run equilibrium, a margin for “normal profits”). The higher the market price, the more sources of supply become profitable and come on line. As its price reflects, shale gas has some of the cheapest production costs. Thus it most certainly is economically viable. But energy is a segmented market. Natural gas does not compete directly with oil and gas. Over time, low natural gas prices will cause change-overs from other energy sources (my mother just changed out her oil fired furnace for a gas furnace), but within its own market, a flood of producers into the industry can easily drive supply up and prices down to the point where no one is making money. The least efficient such producers will be driven out, reducing supply and driving prices go back up to where the producers that remain are making “normal profits.”

    Doesn’t seem fair to the capitalists does it? They do all this great work providing the energy that everyone needs, and the reward they get is that their own efforts systematically bring their own profits down. But that’s the beauty of the system. It doesn’t cater to the capitalists. It uses the capitalists to serve society, “as if by an invisible hand,” in the famous words of Adam Smith. Sorry that Vangel’s investments are not paying off the way he hoped, but it is NOT a sign that shale gas is not viable. Rather, it is SO viable that the expansion of supply quickly drove prices down and took away most of the profits. Well, capitalism can indeed be unfair, because it does not take fairness into account. It’s all about efficiency, which is why we should let it work.

  153. “Sun Spot says:
    March 20, 2012 at 10:03 am

    Many here seem to not like Obama (and he’s not perfect), but when you hold your nose and vote you can’t seriously consider one of the current crop of brain dead Republican zombies.”

    We might not want to go down “Specific Political” paths on this site – it would be counterproductive.

    Let’s just say that many, many people would find that “… brain dead Zombies” remark offensive.

    At least “Zombies” are fictional. Marxists, Fascists, Communists, One-Worlders, Welfare-Staters and various Totalitarian Wanna-bes exist in the real world.

  154. Sun Spot says:
    March 20, 2012 at 10:03 am

    Many here seem to not like Obama (and he’s not perfect), but when you hold your nose and vote you can’t seriously consider one of the current crop of brain dead Republican zombies.
    __________________________________
    I am very much dreading having to make a selections among them. Holding my nose is not going to work, I need to invest in a Scott air pack….

  155. James Sexton says:
    March 20, 2012 at 7:10 am
    “Your talking points have already been addressed. The reason why we haven’t exploited the oil that’s there is because of the same enviro-nutjobs that are blathering so much about CO2.”

    This country has had falling oil production over almost every of the last 40 years (with the exception of 7), no matter which Administration was in charge. But in your mind it’s all the fault of the all-powerful “enviro-nutjobs.”

    There are plenty of posts on this thread that present you with a far more nuanced reality. My simple point was that decline in U.S. oil production seemed to be party-neutral, and I think that stands up to scrutiny.

  156. Gail Combs says:
    March 20, 2012 at 9:16 am
    “I live on a dirt road in the back end of nowhere the nearest civilization is 15 miles ~ a 30 mile round trip so that is about a two day journey for a pony and cart unless the animal is very fit. (This was part of a discussion on another board). I have done 20 -30 mile carriage drives and it leaves me and my animals half dead the next day…

    I feel like George Clooney in Three Kings, trying to explain that “bullion is not the little cubes you put in hot water to make soup.”

    Gail, we are talking macro-economics here. Reducing oil consumption is encouraged on a macro scale. Driving causes accidents, pollution, etc. It’s expensive to society.

    If you live 30 miles up a dirt road, by all means, take the car. No one is begrudging you that.

  157. Alec Rawls,

    >>Natural gas does not compete directly with oil and gas.

    Diesel can be chemically created from a number of feed stocks. As I posted earlier, Shell in Louisiana is making money converting natual gas to diesal. The more we move to diesel in transporation, the better it is for energy supply stability.

    When the UK and Polish natural gas fracking comes on-line, things are going to get very dicey for the Russian Federation.

    The ability to replace directly Russian gas and to convert a portion of that Natureral gas to diesel means a double shock to Russian finances. Gas to diesel places a cap on the up side of crude oil prices as Russian direct income from natural gas is under the most pressure from lower cost supplies.

    RobRoy,

    The larger the share of world energy supply from politically stable areas. The lower the total risk premium speculators can demand.

    That is why oil & gas shale are hugely important to our political near future. The less cash there is available to politically unstable regimes from POL. The more stable the world political environment and the better economic development in stable areas of the globe.

  158. Just do the math. 20 Billion barrels of proven reserves, at US consumption of 40mbbl/day will last less than two years. (world wide consumption was 80mbbl/day in 2010, US consumption was half, and half of the us consumption (20 MBBL/day) was domestically produced). Simply to replace imported oil from canada, venezuela, mexico, nigeria and the middle east would exhaust our proven reserves in four years – assuming we could build 40,000 500BBL/day wellheads in any reasonable amount of time.

    If the 400B BBL “technically recoverable crude” can be economically recovered (which I wouldn’t bet on), that will last 26 years.

    From the Oil Drum:

    In the good areas of the Bakken, with higher porosity and lots of fracture permeability, the recovery might range as high as 5% to possibly 15%. Typically only a few areas, or “sweet spots,” will have recovery this high. Outside the sweet spots, recoveries are likely to be much lower; the reservoir quality will deteriorate, with lower porosity, lower permeability, and fewer fractures, and/or thinner beds of reservoir rock. In these areas, recovery will probably be less than 5% of the oil in place, and in some areas less than 1%. Estimating recovery factor in shale reservoirs is more an art than a science; only after several years of production, and with very good data, can a reliable range of recovery be estimated.

    In the less favorable and thinner areas of the reservoir, even though it might be technically possible to recover 1% or 2% of the oil in place, the risk may be too high to for an operator to be willing to spend $3 to $5 million or more, with no assurance that the well will pay out. In this case the “technically recoverable” reserves might be 1% of oil in place, but the economically recoverable reserves are 0% if an operator is not persuaded to risk capital to drill a well.

    If the 800B BBL”oil shale” can be economically recovered (i.e. EROEI > 1), that will last 52 years.

    The “undiscovered resources” estimate is pure imagination, and anyone who _relies_ on it for policy purposes is insane.

    Assuming zero growth in US consumption.

    There are 950 wells in nodak producing 90k bbl/day (100bbl/day per well average).

  159. Here’s the criteria to judge them by:
    =====================================================
    “GOD, give us men! A time like this demands
    Strong minds, great hearts, true faith and ready hands;
    Men whom the lust of office does not kill;
    Men whom the spoils of office can not buy;
    Men who possess opinions and a will;
    Men who have honor; men who will not lie;
    Men who can stand before a demagogue
    And damn his treacherous flatteries without winking!
    Tall men, sun-crowned, who live above the fog
    In public duty, and in private thinking;
    For while the rabble, with their thumb-worn creeds,
    Their large professions and their little deeds,
    Mingle in selfish strife, lo! Freedom weeps,
    Wrong rules the land and waiting Justice sleeps.

    Josiah Gilbert Holland”

  160. Torgeir Hansson,

    You are wrong about everything, aren’t you? You say:

    “Reducing oil consumption is encouraged on a macro scale. Driving causes accidents, pollution, etc. It’s expensive to society.”

    There is absolutely nothing wrong with oil consumption. It is there to be used, and it makes life much easier and better for everyone. It is not “expensive to society”, it clearly benefits society.

    Windmills are expensive to society. Classifying CO2 as a “pollutant” is expensive to society. Wasting $billions on the runaway global warming scam is expensive to society. But hey, maybe you’re teleconnecting from an alternate universe. That would explain your upside down view of reality.

  161. Alec Rawls says:
    March 20, 2012 at 10:38 am
    “Please, in your quest to support and embrace Obama, do not misrepresent what other people are saying. It’s pretty trollish behavior, posing as someone who wants to give the benefit of the doubt while grossly mis-stating what other people have said.”

    This is getting juvenile.

  162. Torgeir Hansson says:
    March 20, 2012 at 11:39 am

    This country has had falling oil production over almost every of the last 40 years (with the exception of 7), no matter which Administration was in charge. But in your mind it’s all the fault of the all-powerful “enviro-nutjobs.”

    There are plenty of posts on this thread that present you with a far more nuanced reality. My simple point was that decline in U.S. oil production seemed to be party-neutral, and I think that stands up to scrutiny.
    ======================================================
    Well, sure, it’s party neutral, because the nut-jobs remain nut-jobs regardless or what party is in control of the Oval office or congress. As Obama has rightfully claimed, production is up now. Why? Because it’s profitable in the places we’re allowed to drill. But, why bother with the nut-jobs, legislative, and regulatory headaches presented by the U.S. when you can drill without the difficulties elsewhere. But, notice, now that the prices are spiking, we’re producing more. If anything, this points to artificial costs associated with the previously mentioned headaches thwarting production. But, when the profitability exceeds the headaches, they try to drill here as well.

    Speaking of nut-jobs…. you should see what a wonderful job they’ve done with the Keystone oil…… this is why production is in a general decline in this part of the world. Greens Cause More CO2 Emissions And Victory For The 1% The madness they cause.

  163. Torgeir Hansson says on March 20, 2012 at 2:26 am

    You are right. The Democrats held the House for a majority of the last 40 years. Republicans had the majority between 1995-2006. During that time oil production fell every year. EVERY year.

    For the Senate, the Republicans had the majority from 1981-86, 1995-2000, 2003-06. Let’s look at the period between 1995 to 2006. During that time oil production fell every year. EVERY year.

    ..

    … and look at the damage Demos wreak for the periods they ARE in office (as the dems seem to consistently get the repubs to play a game of “go-along to get-along”); I had never realized this before Turgidsson, thanks for point this out and making this case …

    You’re right Turgid, repubs need to grow spines and actually become the opposition for a change.

    .

  164. Smokey says:
    March 20, 2012 at 12:03 pm
    “You are wrong about everything, aren’t you? You say:

    “Reducing oil consumption is encouraged on a macro scale. Driving causes accidents, pollution, etc. It’s expensive to society.”

    There is absolutely nothing wrong with oil consumption. It is there to be used, and it makes life much easier and better for everyone. It is not “expensive to society”, it clearly benefits society.

    This is the sad part about these discussions. Anyone—ANYONE—with half a brain and economics 101 knows that there are externalities, or costs to you, Smokey, to automobile use and petroleum use in our society. Yet you, because you own a computer and an internet connection, can join the discussion, even if you do not have the first clue of what you are talking about. Everybody KNOWS that cars and heaters are great things to have. I love my car. I love the smell of gasoline. I love driving fast. Yet it doesn’t mean that I don’t know there are costs to society from it.

  165. Gail Combs says March 20, 2012 at 9:58 am:

    Your a day late and a dollar short.

    “Ouch”

    (Schedule a ‘Take a Contraction to Lunch Day'; make it “you’re” and yul [sic] be just fine…)

    .

  166. Torgeir Hansson –

    Daily Kos?

    Democrat Underground?

    Crooks and Liars?

    Huff Po?

    From where do you hail (blog wise)?

    Want to ‘hang’?

    .

  167. There’s been some pathetic kvetching here about this article and the discussion being too political. Well, so? The issue we’re beating our heads against a wall is primarily a political one, although I could see an economist or two here argue quite convincingly that it’s economic first.

    The science, we all know, is important. But the science is not the rreal issue. Given how rickety the CAGW claim is, we all know there is sufficient argument to at least put enough doubt to it to slow down the panic decision-making we’ve been subjected to. Yet, curiously, that’s not what’s happening; people are still frightened, governments are making costly and destructive policies, and fantastic sums of money are being sucked away into the pockets of shadowy corporations and activist groups.

    Science and facts will not reverse any of this. Try and provide an easily-understandable and bullet-proof piece of evidence tomorrow that unquestionably proves that CAGW is utterly and totally false…and it will have zero impact on the day after. The subsidies will continue, the regulations will tighten, Greenpeace and WWF will go on harvesting their tribute from corporations and the media will ladle-out the same memes. Science has next to nothing to do with this current disaster, except to serve as a fancy decoration, a snazzy PowerPoint presentation tarting-up decisions already made. This is why the focus needs to be on the political.

    Here, in Canada, we’ve been lucky in that respect. We have possibly the best government in our history, a majority Conservative government which among other things has been quietly taking on the Warmists and the crypto-socialists with excellent economic and social results. But we can’t do it alone. With UK’s pseudo-conservatives and watermelons, Australia in the clutch of a demented Labour administration and the US under a horrific government not even it’s worst enemies could dream up, Canada can only go so far before it starts pissing-off the big guys. So, yes, by all means, let’s argue the politics…even rudely, if need be…because it’s the politics that are destroying our economies, busting our societies, enriching and empowering nations that hate us and leading us and our children into nightmarish, pre-industrial levels of servitude and poverty.

  168. The highest purpose of any ‘economy’ is to find the most efficient use of the available resources. One can not stimulate an economy by moving towards less efficiency. Moving towards less efficiency always has a detrimental impact on an economy.

    Sometimes, it may be wise to move towards less efficiency to avoid an undesirable consequence of that efficiency. For example, if the efficient use of fossil fuels resulted in catastrophic climate change, it may be desirable to move towards another energy source. Such a move will damage the economy, because it is less efficient, but may still be wise.

    Of course, fossil fuels are not and can not cause catastrophic climate change. The reality of this is (and always has been) apparent to anyone with eyes to see. So the logical thing for Obama to do is stop his war on fossil fuels, since there is no threat from fossil fuel use that comes anywhere near outweighing its benefits. Instead, he has decided to wage a war on the economy!?!?

    This war on the economy is two-fold: 1. damage the economy by raising the price of oil through restriction and regulation, and 2. force us to use less efficient forms of energy to accomplish the same things.

    He may be lying about the availability of fossil fuels, but the real gall in his stance is the idea that we must destroy our economy is order to safeguard it. Obama is invoking the economic fallacy of the broken window and expects the country to forget that it is a fallacy. Are we really that stupid?

    Wait…don’t answer that.

  169. Torgeir, you are a nasty piece of work. I quoted Obama and Chu to the effect that they were trying to raise oil prices in order to save the world from CO2. You cast this as my assuming that they are “out to ruin the country,” which is just about the opposite of how I actually characterized their objectives, and when I point it out, your only response is “this is getting juvenile.”

    Certainly on your end. What adult would defend that kind of misrepresentation? You have ZERO integrity. Thanks for proving it.

  170. Torgeir,

    Lots of disagreements over EUR of shale gas. But clearly, lots of major companies — that aren’t the type to buy the hype or buy into long-term losses — spending lots of dollars to get into it. But the key is, there is a lot of shale gas worldwide, with new discoveries being made on about a weekly basis. Lots of that is in “stable” or “more stable” parts of the globe.
    Also, oil production will be going up in the US due to horizontal drilling and fracking, and we are likely to reach peaks not seen before. Many oil patch areas in Texas are experiencing additional drilling, and increasing electricity loads to support the E&P. Certainly, the days of $10 a barrel oil are over, as production costs will continue to increase, but the concept of peak oil fails to recognize that higher costs and better technology can result in bounces to the oil production curve in any given country, or for the world as a whole. Also, your comments on US production over time and political parties and presidents fails to recognize the ups and downs of oil prices, and the impact those huge fluctuations can have on domestic oil exploration and production. And, as we are seeing now, how technological advances can turn things upside down in 5 years time.

  171. In addition to the overt actions of the administration, don’t forget those taken by their sychophants in the green world. After Interior Secretary Salazar made a big deal out of freeing up 370 mm tons of coal here in Wyoming, there was an immediate suit filed with a liberal federal judge who posted an injuction against digging said coal. The best of both worlds for the administration, a big speech in Cheyenne to make an appearance of helping Wyoming and no coal to be dug anyway. These people are the lowest of the low.

  172. Donald L Klipstein says:
    “The past 15 years started with a century class El Nino and ended with a
    double dip La Nina. Global temperature trend would be shown more
    accurately with a time period having lack of upward or downward trend in
    ENSO and AMO, such as from the beginning of 1999 to the beginning of
    2012. The linear trend in HadCRUT3 for that period was .044 degree C
    per decade, and that *may* be the actual rate of warming from increase of
    CO2. If it is, then global climate sensitivity to CO2 change is .67 degree C
    per factor of 2 change in CO2.”

    Please explain the 30yr cooling period from 1940 to 1970 with this logic.

  173. Torgeir Hansson is the quintessential “intellectual” who is religiously wedded to mistaken beliefs about fossil fuels being expensive to society and damaging to our entire planet and every living thing on it. Torgeir subscribes to the idea that fossil fuels (and their derived energy and products) need to be so costly that fewer people can afford them (a necessary requirement if you want to reduce consumption). Can’t everyone see that Torgeir believes that less consumption of fossil fuel is for our own good and the good of our planet (bless his heart)?

    I have got news for Torgeir.

    Torgeir has been caught up by nonsensical green doomsday propaganda. Although he is not the first, nor the last and he is far from being alone; it does not make him right. The truth is that fossil fuels have, on the whole, been miraculously beneficial. Those societies that have the necessary infrastructure to benefit from the use of fossil fuels are enjoying today the highest standard of living the human race has ever seen. These societies also enjoy some of the highest environmental standards – clean water, healthy forests and healthy protected wildlife and wilderness areas (things a poverty stricken society could never even begin to worry about).

    Just how Torgeir equates all this fossil fuel driven food production, higher living standards, better environmental stewardship, good health and greater life expectancy to being “expensive to society” is a complete mystery.

    Did Torgeir by chance study at the French Sorbonne with Pol Pot?

  174. Scott,

    The Tuscaloosa Marine Shale is even larger than the Bakken shale.

    This article snipped below indicates that the present price of producing vehicle fuel from coal is about $9.60 per gallon, with a 20% decrease (to $7.68) being immediately possible from this new technique, and under $4 per gallon being theoretically feasible.**

    The Warmists/Greenies still hate it because it’s a hydrocarbon.

    It is still nice to know that America’s immense coal reserves can be converted to a more easily handled liquid fuel at an affordable price. I am suspicious, though, about the amount of fresh water that would be required.

    ** My math assumes an electricity cost of 5 cents per kilowatt hour, which is $0.8333 per megawatt/second.

    http://blog.wired.com/wiredscience/2009/03/coaltoliquids.html

    Bad News: Scientists Make Cheap Gas From Coal
    By Alexis Madrigal March 26, 2009

    Electric cars have been getting a lot of buzz lately, but a more immediately viable transportation fuel of the future could be liquid derived from coal. Scientists have devised a new way to transform coal into gas for your car using far less energy than the current process. The advance makes scaling up the environmentally unfriendly fuel more economical than greener alternatives.

    If oil prices rise again, adoption of the new coal-to-liquid technology, reported this week in Science, could undercut adoption of electric vehicles or next-generation biofuels. And that’s bad news for the fight against climate change.

    The new process could cut the energy cost of producing the fuel by 20 percent just by rejiggering the intermediate chemical steps, said co-author Ben Glasser of the University of the Witwatersrand in Johannesburg, South Africa. But coal-derived fuel could produce as much as twice as much CO2 as traditional petroleum fuels and at best will emit at least as much of the greenhouse gas.

    “The bottom line is that there’s one fatal flaw in their proposed process from a climate protection standpoint,” Pushker Karecha of NASA’s Goddard Institute for Space Studies wrote in an e-mail to Wired.com. “It would allow liquid fuel CO2 emissions to continue increasing indefinitely.”

    The race for alternative fuels kicked into high gear last year, with the price of oil reaching $150 a barrel before plummeting down below $40 this year. Still, though experts disagree on the specifics of timing, it’s clear that conventional oil sources will eventually run out. The list of contenders to replace oil is long and diverse. Alternative fuels could include next-gen ethanol, algal biofuel, hydrogen and natural gas, or cars could go largely electric.
    But the problem with all the new fuels is that they have to scale up — and that’s harder than it sounds. Plus, many fear that biofuels could cause massive, negative land-use changes.

    The process of cooking coal into liquid fuel, on the other hand, has already proven itself on a massive scale. Take coal, add some water, cook it, and you’ve got a liquid fuel for your car. The hydrogen in the water bonds to the carbon and voila: hydrocarbons, such as octane. It’s the very fact that coal-to-liquids could work that make them such a scary idea for people devoted to fighting climate change.

    The Nazis used the so-called Fisher-Tropsch process to provide up to half of their transportation fuel needs during World War II. Later, South Africa began a major coal-to-liquids program during the Apartheid era and now maintain the world’s largest CTL industry in the world. The country’s factories produce 160,000 barrels of fuel a day, a little more than all the residents and businesses in Utah use each day.

    The traditional process uses carbon monoxide, carbon dioxide, and hydrogen as the ingredients in the molecular soup that gets turned into hydrocarbons. The Science process uses just CO2 and hydrogen.

    Glasser’s new production method allows them to set a lower limit on the amount of energy that would be needed to transform solid coal into fuel. The very best possible CTL process would require 350 megawatts of input to make 80,000 gallons of fuel; the current process uses more than 1,000 megawatts.

    Even with the small efficiency gains, a large, domestic, carbon-intensive source of transportation fuel would throw a wrench into many plans to reduce emissions from vehicles.

    “What they’re proposing is simply not allowable if we want to avoid the perils of unconstrained anthropogenic climate change,” Karecha said.

    >much snippage<

  175. Sent a lot of this to Politifact.com, just curious if they’d like to weigh in again. Btw, Newt and Mitt have the most False & Liar, liar, pants on fire. But Santorum is catching up. I see far more Ron Paul signs & banners all over this country! hmm? SpaghettiO does have a lot of false & half truths, a lot of true and far more comments examined.

    http://www.politifact.com/personalities/

    http://www.politifact.com/personalities/ron-paul/statements/

    http://www.politifact.com/personalities/ron-paul/

    http://www.politifact.com/personalities/newt-gingrich/

    http://www.politifact.com/personalities/mitt-romney/

    http://www.politifact.com/personalities/rick-santorum/

    http://www.politifact.com/personalities/barack-obama/

    http://www.politifact.com/truth-o-meter/statements/2012/jan/24/barack-obama/barack-obama-says-us-oil-production-eight-year-hig/

    Barack Obama says U.S. oil production is at eight-year high

    In his State of the Union address on Jan. 24, 2012, President Barack Obama talked up U.S. oil production.

    “Nowhere is the promise of innovation greater than in American-made energy,” Obama said. “Over the last three years, we’ve opened millions of new acres for oil and gas exploration, and tonight, I’m directing my administration to open more than 75 percent of our potential offshore oil and gas resources. Right now, American oil production is the highest that it’s been in eight years. That’s right – eight years. Not only that – last year, we relied less on foreign oil than in any of the past sixteen years.”

    This passage includes a number of claims, but here we’ll focus on the one that “right now, American oil production is the highest that it’s been in eight years.”

    We looked at a similar claim on March 15, 2011, and rated it Mostly True. But we will update our assessment based on new data.

    We turned to the Energy Information Administration, the federal government’s official office for energy statistics. Since Obama said “oil production,” we will only look at crude oil extracted from U.S. territory, rather than natural gas or other petroleum products.

    Here are the annual totals, in barrels produced, going back to 2003:

    2003: 2,073,453,000 2004: 1,983,302,000 2005: 1,890,106,000 2006: 1,862,259,000 2007: 1,848,450,000 2008: 1,811,817,000 2009: 1,956,596,000 2010: 1,998,137,000

    The full-year data is available only through 2010, but 10 months of data from 2011 have been made public. Through the end of October 2011, production totaled 1,713,038,000 barrels. If that pace continues, the year-end total should be around 2,055,646,000 barrels — higher than any year since 2003. That’s eight years ago, just as Obama said.

    The last time we looked at this question in March 2011, we noted that production levels actually have been quite stable over the period in question. The estimated level for 2011 is only about 13 percent higher than for the lowest year in that eight-year period. So the increase the president is referring to is not particularly dramatic. In addition, levels of production were typically higher from the 1950s to the 1990s.

    However, one caveat we mentioned in our last analysis — that the Energy Information Administration projected that production totals were poised to fall over the subsequent two years — no longer appears to be accurate.

    The most recent “Short-Term Energy Outlook,” published on Jan. 12, 2012, forecast increases in total crude oil production in 2012 and 2013, thanks to increases in onshore production in the Lower 48, which overshadow declines in production in Alaska and the Gulf of Mexico.

    The last issue is whether Obama and his administration claimed credit for this achievement and whether they deserve it.

    The government does play a role in shaping oil production, but many other factors, including private-sector business imperatives and the domestic and international energy market, are factors as well.

    We think Obama’s phrasing suggests that he thinks the administration’s policies have played a role, saying, for instance, that “over the last three years, we’ve opened millions of new acres for oil and gas exploration.” But we also think he does so cautiously.

    Our ruling

    Obama was correct when he said that “right now, American oil production is the highest that it’s been in eight years.” We think he may have overstated his administration’s role in achieving that, but not wildly so. We rate the claim Mostly True.

  176. My own views on energy policy are beyond the scope of this post, but I’ll just note here in the comments that I think it is crazy to be using fossil fuels for anything but transportation when we could have been switching to nukes for our electricity generation for the last forty years. The early designs weren’t great, but if that was where we focused our research we could have done a lot better. We had the basic Thorium research going back to the 50s and probably could have used it to develop fail-safe commercial reactors from 1970. The lack of development of nuclear energy is another gigantic eco-fail.

    What we do NOT need is Obama’s “all of the above,” by which he means his constricted fossil fuels policies, plus solar, wind and bio-fuel. The last three are uneconomic. They cannot survive at all without massive subsidy, and even then quickly go bankrupt.

    The true extent of the subsidies is mostly hidden. California, for instance, imposes renewable energy requirements which force every local utility to buy up any “renewable” energy that is available to the grid and pay top dollar for it. The costs of these forced purchases get passed on to consumers while traditional generators get bounced whenever the wind is blowing or the sun is shining, forcing their overhead costs way up and making THEIR electricity more expensive to consumers too. So it isn’t just the direct losses on garbage like Solyndra and Fisker, but the massive distortions and inefficiencies that permeate the entire market under green mandates.

    This instanity is KILLING our economy, right now, right before our eyes. It doesn’t matter that greens like Stephen Chu are well meaning in their scientifically unsupported belief that they are saving the planet. They are unplugging the modern world and they need to be stopped.

  177. Ed Mertin says:
    March 20, 2012 at 3:16 pm

    Sent a lot of this to Politifact.com……..
    =========================================
    If you want to do a proper fact check, look and see how much drilling is going on in public lands vs private, where the govt. has no control. I allow that it is factual, I’ve already checked. But, it is still disingenuous. He’s taking credit for allowing people to drill off shore again? Or that he only withdrew 1/2 of the leases already granted? That the oil companies are going around the president to drill oil when it sells for $108/barrel, can’t be seen as an accomplishment. It’s farcical.

    Anyone repeating the tripe he stated as factual is simply a propaganda tool for the administration.

  178. Alec Rawls says:
    March 20, 2012 at 3:53 pm

    My own views on energy policy are beyond the scope of this post, but I’ll just note here in the comments that I think it is crazy to be using fossil fuels for anything but transportation……
    ========================================================
    Careful Alec, you should distinguish what you mean by that. It’s people like you who have confused our poor Sec. of Energy Chu. Fossil fuels can be thought of as coal, nat gas, and petroleum, and their derivatives. Clearly coal’s function is for electricity….. though, advancements are being made in the liquidizing process. Nat gas could be used for transport, but it isn’t very good, yet. It’s for electric and heating, and cooking…… it’s the petro that’s good for transportation.

    Alec, I know you know this, I was just stating plainly for the people who may be confused…..such as our Sec. of Energy…….,,,,,,Here Alec…. or anyone else….. explain this bit of madness….. http://suyts.wordpress.com/2012/03/20/uhmm-chu-a-for-effort-f-for-knowledge

  179. _Jim says:
    March 20, 2012 at 1:11 pm
    @Jim:
    If I am not here, I’m usually arguing about climate change on HuffPo.

    Alec, what Is up with you? All I am saying is that there is a tendency on this thread that Obama has to be ALL BAD. He is a liar, a fraudster, and imposter, a usurper. Get off it please. The guy is a centrist Democrat. He’s no extremist in any sense of the word. That concludes my part of the discussion. And I am not a nasty piece of work BTW.

    Stop calling me names. This is getting childish.

  180. Husker Homer says:
    March 20, 2012 at 2:08 pm
    Torgeir,
    “Also, your comments on US production over time and political parties and presidents fails to recognize the ups and downs of oil prices, and the impact those huge fluctuations can have on domestic oil exploration and production. And, as we are seeing now, how technological advances can turn things upside down in 5 years time.”

    I never touched that point. My point was to demonstrate that oil production in the U.S. is not dependent on political parties. It is market-driven, which is your point, which I agree with 100%.

  181. Jeremy says:
    March 20, 2012 at 3:07 pm
    “Torgeir has been caught up by nonsensical green doomsday propaganda. Although he is not the first, nor the last and he is far from being alone; it does not make him right. The truth is that fossil fuels have, on the whole, been miraculously beneficial. Those societies that have the necessary infrastructure to benefit from the use of fossil fuels are enjoying today the highest standard of living the human race has ever seen. These societies also enjoy some of the highest environmental standards – clean water, healthy forests and healthy protected wildlife and wilderness areas (things a poverty stricken society could never even begin to worry about).”
    ————————–
    All of these things are 100% correct. Fossil fuels bring wealth in direct proportion to its use. The benefits are great.

    Part of the wealth that is created is used by governments to mitigate the externalities, which largely consist of pollution in the form of soot, CO, NOx, and other harmful gases. And then there are injuries, especially on the roads. That’s why we have CAFE standards, that’s why we have speed limits, and that’s why Richard Nixon established the EPA and signed the Clean Air Act.

    We don’t disagree, so stop this feverish blather about “nonsensical green doomsday propaganda.” You better believe that the United States government spends money and effort on mitigating the downsides of fossil fuel use. And you better believe that this country should work on developing the next generation of energy sources. A green technology that works well for homes is solar, the likely utility-scale technology is nuclear, possibly with natural gas as an intermediate technology. France gets 70% of its power from nuclear today.

  182. Alec Rawls says:
    March 20, 2012 at 3:53 pm
    “This insanity (sic.) is KILLING our economy, right now, right before our eyes. It doesn’t matter that greens like Stephen Chu are well meaning in their scientifically unsupported belief that they are saving the planet. They are unplugging the modern world and they need to be stopped.”

    This is what I don’t understand. If this “insanity” is KILLING our economy, how come we are seeing an economic recovery after the 2008 crash? It doesn’t add up. The facts say otherwise.

  183. Torgeir, “A green technology that works well for homes is solar”

    Oh dear, it seems that solar (which is uneconomic currently as it costs more than coal fired power) appears to be suffering a bit of a setback, even under the administration that has been its biggest proponent.

    http://www.bbc.co.uk/news/business-17450718

    Could it be that all those Green US Jobs that Obama and Dr Chu promised have gone to China? Could it be that executives at collapsed Green start-ups burned up billions of taxpayer funds?

    O RLY?

  184. john says:
    March 20, 2012 at 4:47 pm

    This is a must read.

    More Johnson And Carbon Taxes

    http://market-ticker.org/akcs-www?post=203625

    =================================================
    The problem with Libertarians is that they’re hard to organize and they aren’t very complicit. Johnson is less of a Libertarian than I am, and I’m a conservative. He’s a liberal with conservative tendencies. He’s backwards. But, many Libertarians are.

    As a former card carrying member of the Libertarian party, I’ve got to tell you, there’s a bunch of nuts in that tree. That party is nothing but disappointment. If and when they want to get serious about being a political force, then I’ll reconsider my position on that party and offer to assist in any way I can. Toss his behind, and then set a foundation of principles.

    • The problem with Libertarians is that they’re hard to organize and they aren’t very complicit. Johnson is less of a Libertarian than I am, and I’m a conservative. He’s a liberal with conservative tendencies. He’s backwards. But, many Libertarians are. As a former card carrying member of the Libertarian party, I’ve got to tell you, there’s a bunch of nuts in that tree. That party is nothing but disappointment. If and when they want to get serious about being a political force, then I’ll reconsider my position on that party and offer to assist in any way I can. Toss his behind, and then set a foundation of principles.

      Libertarians are no more monolithic and clearly no more ‘backwards’ than either conservatives or liberals. But they are less confused than either conservatives or liberal because their philosophy is based on the idea that freedom from coercive action is a necessary foundation for the best society. It is very clear that on that front both the liberals and conservatives fall short because both believe in coercion as the basis of political activity.

      That having been said, shouldn’t we stick to the topic at hand?

  185. Torgeir: Ordering me not to call you “names” while continuing to call me “childish.” You really are a piece of work, still insisting that it is perfectly a-okay for you to completely mis-represent what I am saying about Obama and Chu. You find it convenient to pretend that I present their motive as the ruination of the country and that’s supposed to make it okay. So you’re not nasty? Then stop trying to defend the indefensible.

  186. Torgeir Hansson says:March 20, 2012 at 2:16 am
    “Allan, I believe solar is a good alternative for many residences.”

    Torgeir, I am referring to grid-connected solar power, which requires truly enormous subsidies and makes no economic or energy sense, imo.

    I agree that solar is economical for residential lighting, provided it is daytime, the residence has abundant windows, and the curtains are open. :-)

  187. Alec Rawls says:
    March 20, 2012 at 3:53 pm

    My own views on energy policy are beyond the scope of this post, but I’ll just note here in the comments that I think it is crazy to be using fossil fuels for anything but transportation when we could have been switching to nukes for our electricity generation for the last forty years….
    _________________________
    AMEN!

    What actually happened at Fukushima pretty much shows the old designs were decent and that we can handle problems.

    From what I have read mini thorium reactors could be used to power ships and possibly trains. I think I read that the US military was looking into a nuclear powered plane at one time too.

    As a chemist I feel wasting hydrocarbons on producing electricity is an out right crime!

    Nuclear powered aircraft development: http://www.century-of-flight.net/Aviation%20history/evolution%20of%20technology/nuke.htm

    Nuclear cars: http://www.txchnologist.com/2011/the-thorium-laser-the-completely-plausible-idea-for-nuclear-cars

    Would Thorium Powered Ships be better for the Navy? http://yottawattsthorium.blogspot.com/2010/02/thorium-powered-ships-for-navy.html

    Thorenco LLC: http://thorenco.com/

    When I mention Thorium I often get “That technology is not proven or whatever. Here is a document about that subject:

    http://www.thoriumenergyalliance.com/downloads/A_New_Energy_Age_for_DoD_James_Howe.ppt
    A New Energy Age For DoD ~ James Howe presentation

    THORIUM FUEL CYCLE — POTENTIAL BENEFITS AND CHALLENGES
    IAEA, VIENNA, 2005…
    Printed by the IAEA in Austria
    May 2005

    ….From the inception of nuclear power programme, the immense potential of 232Th for breeding human-made ‘fissile’ isotope 233U efficiently in a thermal neutron reactor has been recognized. Several experimental and prototype power reactors were successfully operated during the mid 1950s to the mid 1970s using (Th, U)O2 and (Th, U)C2 fuels in high temperature gas cooled reactors (HTGR), (Th, U)O2 fuel in light water reactors (LWR) and Li7F/BeF2/ThF4/UF4 fuel in molten salt breeder reactor (MSBR). 232Th and 233U are the best ‘fertile’ and ‘fissile’ materials respectively for thermal neutron reactors and ‘thermal breeding’ has been demonstrated for (Th, U)O2 fuel in the Shippingport light water breeder reactor (LWBR). ThO2 has also been successfully used as blanket material in liquid metal cooled fast breeder reactor (LMFBR) and for neutron flux flattening of the initial core of pressurized heavy water reactor (PHWR) during startup. So far, thorium fuels have not been introduced commercially because the estimated uranium resources turned out to be sufficient…..

    The feasibility of thorium utilization in high temperature gas cooled reactors (HTGR), light water reactors (LWR), pressurized heavy water reactors (PHWRs), liquid metal cooled fast breeder reactors (LMFBR) and molten salt breeder reactors (MSBR) were demonstrated. These activities have been well documented in several extensive reviews and conference proceedings published by US Atomic Energy Commission [1], US Department of Energy [2], [3], KfA, Germany [4] and IAEA [5]. More recently, the proceedings of IAEA meetings on Thorium Fuel Utilization: Options and Trends has summarized the activities and coordinated research projects (CRP) of IAEA and the status of thorium fuel cycle option, including ADS, in Member States [9]. The initial enthusiasm on thorium fuels and fuel cycles was not sustained among the developing countries later, due to new discovery of uranium deposits and their improved availability…..

  188. But profitability does not tell the tale. If producers are not making money, it is because the glut of supply has driven natural gas prices down to the level of production costs.

    The problem is the energy cost of the energy being extracted. That is the point missed by most of the people who are hyping up the shale producers without thinking. If supply falls and gas goes up to the break-even price of $8 per Mcf the producers can start drilling again. But the current break-even price depends on drilling the better locations in the most productive formations, not the average shale property. And the higher the production level the more drills that you will need just to offset depletion. That means more drill rigs, and more drill crews. But there is a huge shortage of qualified people and new rigs. The producers of specialty pumps, compressors, etc., are also having trouble with their supply chains because the short supply of the special skills and experience needed to produce them are driving costs higher.

    I have been in regular contact with people in the tar sands. If you look at the projects you see huge cost overruns because the price of design, engineering services, raw materials, skilled labour, and specialty equipment is exploding. The same cost drivers are showing up in the shale sector every time activity increases. And if you understand the depletion issue you know that demand or services has to keep growing faster than the production level increase. Sorry but the math is simple and you cannot escape the consequences.

  189. Allan MacRae says:
    March 20, 2012 at 7:10 pm

    Torgeir Hansson says:March 20, 2012 at 2:16 am
    “Allan, I believe solar is a good alternative for many residences.”

    Torgeir, I am referring to grid-connected solar power, which requires truly enormous subsidies and makes no economic or energy sense, imo.

    I agree that solar is economical for residential lighting, provided it is daytime, the residence has abundant windows, and the curtains are open. :-)
    ================================================
    And, that’s the only way it makes sense. Connecting little home panels to the grid decreases efficiency, and solar farms are inane.

  190. How refreshing! The Smartest President Ever has abandoned one spurious reason for foolish wasteful spending, and adopted another in its stead. And the foolish wasteful spending continues unabated. And the cronies wax fat.

  191. Torgeir Hansson says:
    March 20, 2012 at 5:53 pm

    ….This is what I don’t understand. If this “insanity” is KILLING our economy, how come we are seeing an economic recovery after the 2008 crash? It doesn’t add up. The facts say otherwise.
    __________________________
    The economy is “recovering” DESPITE all the blockades government tosses in our path. It is mainly thanks to small business that we see any recovery at all.

    (The newest graphs are subscription only)
    Housing starts bombed and are still swimming in the sewer: http://www.shadowstats.com/article/no-419-january-cpi-ppi-real-retail-sales-and-housing-starts

    Unemployment is still around 23%: http://www.shadowstats.com/alternate_data/unemployment-charts

    GDP has grown about 2% from having nose dived by -4% (so it is still 2% lower than in 2008)(last graph on page) : http://www.shadowstats.com/article/no-366-first-quarter-gdp-retail-sales-revisions-hyperinflation-watch

    Small firms accounted for 65 percent (or 9.8 million) of the 15 million net new jobs created between 1993 and 2009…. An estimated 552,600 new employer firms opened for business in 2009, and 660,900 firms closed…. http://web.sba.gov/faqs/faqIndexAll.cfm?areaid=24

    So MORE firms CLOSED than opened.

    Small businesses losing out to red tape

    http://www.usatoday.com/news/opinion/forum/2010-10-21-mellor26_st_N.htm

    ….cities and states stifle new small businesses at every turn, burying them in mounds of paperwork; lengthy, expensive and arbitrary permitting processes; pointless educational requirements for occupations; or even just outright bans. Today, the Institute for Justice released a series of studies documenting government-imposed barriers to entrepreneurship in eight cities. In every city studied, overwhelming regulations destroyed or crippled would-be businesses at a time when they are most needed.

    Time and again, these reports document how local bureaucrats believe they should dictate every aspect of a person’s small business. They want to choose who can go into which business, where, what the business should look like, and what signs will be put in the windows. And if that means that businesses fail, or never open, or can operate only illegally, or waste all their money trying to get permits so they have nothing left for actual operations, that’s just too bad. This attitude would be bad enough in prosperous times, but in a period of financial strain and high unemployment, it’s almost suicidally foolish…..

    The Institute for Justice:

    http://www.ij.org/citystudies

    http://www.ij.org/about/3425

  192. Maybe the President worked it out for himself …

    Note the word “process” in the Clausius statement:

    No process is possible whose sole result is the transfer of heat from a body of lower temperature to a body of higher temperature.

    The Second Law can be illustrated with a hose used as a siphon to empty a swimming pool, for example. It works if the other end of the hose goes down a slope and is significantly below the bottom of the pool.

    The water flows and entropy increases because we have a single process. The SLoT requires a single process, as is obvious in everyday life.

    If you cut the hose at the highest point you now have two processes, and the water no longer goes upwards from the pool.

    Any heat flow from a cooler atmosphere to a warmer surface is a single completed process. The energy is not constrained to return by radiation or to do anything in particular. It could be conducted elsewhere in the surface for example.

    Because it is a single process from atmosphere to surface, there is no justification for saying that any subsequent process can create a net effect and thus excuse the violation of the Second Law. It would be like water flowing uphill to the town’s water tank on the basis that it would subsequently flow further downhill through pipes into houses. But there is no constraint enforcing this, as there was with the siphon before the hose was cut. After all, the tank might leak.

    Hence, thermal energy cannot transfer spontaneously from a cooler atmosphere to a warmer surface. Fullstop.

    See my publication Radiated Energy and the Second Law of Thermodynamics

    http://www.webcommentary.com/docs/jo120314.pdf

  193. Solar works for PG&E households in California. Granted that the Federal Tax Credit of 30% is required to get it there, but homeowners who install solar pay less per kWh than they would to PG&E, and if you calculate over the total lifespan of the system it beats PG&E even without the tax credit.

  194. Alec Rawls says:
    March 20, 2012 at 6:54 pm
    “Torgeir: Ordering me not to call you “names” while continuing to call me “childish.” You really are a piece of work, still insisting that it is perfectly a-okay for you to completely mis-represent what I am saying about Obama and Chu. You find it convenient to pretend that I present their motive as the ruination of the country and that’s supposed to make it okay. So you’re not nasty? Then stop trying to defend the indefensible.”

    Can we drop it? If you say you don’t believe that Obama and Chu are trying to drag us into wreck and ruin, I believe you.

  195. And if you understand the depletion issue you know that demand or services has to keep growing faster than the production level increase. Sorry but the math is simple and you cannot escape the consequences.
    =======================================
    LOL!!! And if you understood that Moore’s law doesn’t simply apply to integrated circuits, you’d have a better grasp of the math. Yes, there is a finite amount of energy we can dig up….. no, we haven’t found half of it, yet. Yes, we always innovate better ways of finding it and getting it and using it.

    And then finally, likely thousands of years from now, when we’ve finally caught up with that nuclear reactor in the center of the earth, we’ll realize that we can’t spend energy.

    There is nothing to fear in terms of energy utilization, other than ignorance.

  196. Hansson, as Alec says, you are a piece of work. His verbatim quote was: “You find it convenient to pretend that I present their motive as the ruination of the country and that’s supposed to make it okay.”

    Note the “and”, word-game player.

  197. Funny thing – the Globe and Mail was one of the biggest supporters of the Global Warming Scam and so-called “Green Energy”.

    Note the huge subsidies:
    13.5¢/kWh for worthless wind power and 64.2¢/kWh for worthless solar power.

    Natural gas-fired electric power can probably be generated today for about 4 cents per kWh.

    Attaboy Doltan! Way to screw the Ontario manufacturing industry!
    ______________________

    Ontario’s Green Dream Was Just a Fantasy

    Across the countryside outside Toronto, wind turbines are spreading like the plague. They are being built over the objections of rural residents whose rights are being ignored by the Province of Ontario. They’re chewing up birds and billions of taxpayer dollars in the name of a green dream that’s nothing but a fantasy. In an effort to placate the voters, Premier Dalton McGuinty promises to trim the subsidies for solar and wind and to give rural communities more say.

    However, these changes won’t affect contracts already in place. That means projects already approved, but not built, will be eligible to get 13.5¢/kWh for wind and 64.2¢/kWh for solar, keeping the building boom going for the next three or four years.

    Green energy was supposed to launch a vast new industry in Ontario with the export of products and expertise to the world. But the world is losing interest. Instead the next energy boom, and the resulting jobs, will be due to brown energy in the form of low-cost natural gas.

  198. Torgein says:

    Can we drop it? If you say you don’t believe that Obama and Chu are trying to drag us into wreck and ruin, I believe you.

    Certainly we can drop it. I have no idea why you ever started it, or insisted on insulting me when I pointed out your misrepresentation of what I had said.

    Your latest misrepresentation calls for correction too. I didn’t say anything about what I believe Obama’s and Chu’s motivations to be. I only quoted what they have SAID about their motivations. Both have claimed that they want high energy prices in order to save the world from too much greenhouse gas (i.e. global warming).

    With Chu, I take that at face value. Obama is a much more mysterious figure. Virtually every one of his long-time mentors and confidants is an outright racist, communist or Islamic supremacist, so who knows what actually motivates him, but it is certainly possible that he buys the global warming claptrap and honestly believes that making energy prices “necessarily skyrocket” is the way to save the planet.

  199. Torgeir Hansson says:
    March 20, 2012 at 1:43 am

    By the way, if anyone is atavistic, it is you. You seem to summon up a Viking-kind of temper when I make reference to “Barack the Usurper.” But the fact is that he has been usurping a lot of legislative power, and expanding his own executive powers to the point of breakage, to do things that others actually have responsibility for under the U.S. Constitution. That would make him quite comparable to many of the failed kings and tyrants of the past as well as the present. You are as blind as a bat if you haven’t noticed. Or is it that Scandinavian trait for complete submission to authority that brings out the worst in you?

    And by the way, in the past 40 years, Democrats have had majority control (or at least control of one house or another) of the Congress of the United States 28 of those 40 years, and are responsible for creating most of the environmental and economic legislation (from financial reform to health care to Social Security to Medicare to soup to nuts) that results now in the hampering of both our ability to drill for oil and our ability to remain economically successful. So I wouldn’t be so fast to pin the tail on the elephant. It still belongs to the donkey for the most part, even with the dumb things that Republicans have done to enable the addicts on the Democratic side.

    Your snide remarks about “thanks for playing” are simply further proof that you are nothing but a dunderheaded ideologue that has little regard for what is going on around you. So you are quite welcome; fencing with you has been a barrel of laughs.

  200. Obama stopped pushing Global Warming when he got laughed at in a speech or three. Doesn’t mean he’s not drinking the cool-aid though, just not saying it out loud.

    Per the “energy in vs out” argument: That is based on a fallacy or two. If I need motor fuel and have electricity, it’s a fair trade to use an electric pump to lift oil even at a net energy loss. I will lose more charging and discharging batteries in my e-car, so it’s better to lift oil and burn it in a combustion engine. Also, realize that such things as refining are net energy consumers, yet we do it, as the FORM of the energy is more important. Then there’s the fact that you are predicting no improvement in technology when you assume a given ‘energy cost to lift’. The history of the last 50 years is one of secondary, then tertiary oil recover from “spent” fields as new techniques made them economical again.

    Take shale oil, for example. Canada has a load of “stranded natural gas”. Needs pipelines to get it to market (where it will sell for ‘nearly nothing’ as cheap gas has driven cost down from $12 / unit to near $3 / unit). OR, it can be used to extract oil to make gasoline and Diesel and jet fuel that are all worth much much more. As Nat Gas is presently running about 1/3 the cost per Gallon of Gas Equivalent, I really don’t care if I burn 2 GGE of it to get one gallon of real gas.

    Yes, you could build natural gas pipelines (oh, wait, Obama keeps canceling pipelines…) and pay a couple of $Thousand per car to convert them to run on natural gas (and, BTW, use about 1/4 of the energy in the gas to compress it to high pressures in the tanks in the cars…) but it is MORE ECONOMICAL and a good idea to use it to make gasoline instead.

    There simply is NO energy shortage. Not a bit.

    FWIW, if Obama really wanted energy independence, we’d be making Natural Gas To Liquids and Coal To Liquids facilities at full speed. South Africa makes coal into gasoline, Diesel, Jet-fuel, and chemicals and has since the 1970s. It’s all “Off The Shelf” turnkey technology. Just sign the contracts. (i.e. have ALL Federal purchases state “Only US made synthetic fuels from GTL and CTL approved to buy.)

  201. @Gail Combs

    AH! Maybe that is another reason for the land grab going on in Africa right now. I just thought it was food, but now that I think about it, valuable resources under the land are another very good reason especially when there are absolutely no environmental laws to worry about.

    The African Land Grab
    African Land Grab – “Acres for a bottle of Scotch”

    +++++++++++
    So things don’t change! I have several stories collected from the late Peter “Mabhodweni” Forbes about how Swaziland ended up the little country it is now. Their territory used to be 3 times larger before incompetence, alcohol and avarice hemmed it into its present 7000 sq mi. There is an old Swazi royal residence near Springs on the eastern end of Johannesburg. Of course, not everything was peace and calm even back then. The Swazis were feared slave catchers who sold their neighbours to the Arabs and Portuguese in Maputo. As they say, no one is innocent.

    Question: as the desert north of the Sahel has been retreating north rapidly, who is grabbing that land? Is that the reason the Tuaregs are managing so much better with their plan to separate a Saharan state from the desert portions 6 countries, a region that climate improvement has made so much more liveable? They are one of the last ‘national groups’ that have widespread slaveholding. For example, their handicrafts are made by slaves. They are ‘managers’. People forget why there is so much fighting in Africa. You can still buy a captured South Sudan young woman in the slave market in Khartoum for $10-$20.

  202. Vangelv,

    So who am I to believe on oil shale, you or Morgan Stanley:

    BEHOLD, The Massive Sea Change Happening In The American Energy Industry
    Joe Weisenthal | May 30, 2011, 7:48 AM

    A new report out from Morgan Stanley on the “renaissance” of the American oil industry argues that — contra the natural gas bulls — the future of American domestic energy production lies in oil.
    Specifically, they argue that technological innovation is now allowing for oil extraction from previously un-economical shale deposits. This is game changing.
    The report is huge, but these four charts really stand out.

    Read more: http://www.businessinsider.com/the-future-of-the-american-oil-industry-2011-5#ixzz1NtD5ZO1A

    The problem with folks like you and those over at the Oil Drum is that all of you pretend the Cost Concept doesn’t exist.

    The Cost Concept in a nutshell: as the price of a mineral rises, the increased price allows for affordable production of previously-uneconomical but known resources. For oil that means drilling
    deeper, in more hostile areas, having secondary and tertiary recovery become practical (something you didn’t know: more oil has been left in previously-primary-produced reservoirs than has ever been extracted from them), and having oil shale, coal gasification, tar sands, and other
    alternate sources suddenly become practical as well.

    Commodity cost competition will then foster technological innovation which further that lowers the price of extraction at those hostile known areas or alternate technologies.

    This is what an oil industry Fracker told me recently:

    Fracing technology has come very far in a short time. We used to drill a long lateral and put just a few fracs in it. Our last well had 35 fracs, used 5 million gallons of water (there are a little over 325,000 gallons of water in an acre foot, which is the volume necessary to cover an acre in one foot of water), and we used a little over 4 million pounds of sand. Environmental damage? None. Noise? During those fracs it’s loud, like jet engines almost. We’ve adopted a lot of the Bakken fracing technology for our (snip) fracs, and we have superior porosity in the rock to what they have in those shales.

    Plus, the Cost Concept also affects unknown resources. For instance, now we can finally afford to drill deep. No one knows what deep reserves exist in mature basins like the Gulf Coast BECAUSE NO ONE HAS EVER DRILLED FOR THEM. Why? It cost too much.

    But now?

    Likewise it’s time to open up both coasts and Alaska and tell the Green/Warmist rent seekers to pound sand…Tar Sands!

    • Vangelv, So who am I to believe on oil shale, you or Morgan Stanley…

      I think that you should ‘believe’ the 10-K filings with the SEC. It is hard to support the MS claims by looking at the balance sheets and the cash flow statements of the shale gas and oil producers. If MS were correct you would expect the producers who have been at it for years to be able to self finance. The fact that they can’t should be a red flag.

      And if the actual facts are not sufficient to rid you of your ‘belief’ then I suggest that you look to the housing and tech bubbles and see what MS and the other brokers said about them. If you do you will find them being cheerleaders even after the bubbles popped and reality was evident to all but the most ignorant and illogical. Given that track record why would you believe what MS is saying rather than looking at the actual filings?

  203. Crispin still in Johannesburg says:
    March 21, 2012 at 1:54 am

    …Is that the reason the Tuaregs are managing so much better with their plan to separate a Saharan state from the desert portions 6 countries, a region that climate improvement has made so much more liveable? They are one of the last ‘national groups’ that have widespread slaveholding. For example, their handicrafts are made by slaves. They are ‘managers’. People forget why there is so much fighting in Africa. You can still buy a captured South Sudan young woman in the slave market in Khartoum for $10-$20.
    —————————-
    Try telling that to the blacks in the USA who are adopting Islam. Try telling them they are aligning themselves with the slave traders. At least the Wiki article on the Tuaregs admits they may still practice slavery. http://en.wikipedia.org/wiki/Tuareg_people#Bonded_castes_and_slaves

    For some reason Americans seem to believe slavery is dead in the world even though it is still practiced here in the USA. On occasion you will run across an article about it. The last one I saw was about a corporation in Florida that enticed immigrants from India and then held them captive in a compound. One managed to escape and flee to a nearby church. Luckily the Pastor he found believed him. (Can’t find the link anymore)

    So why should anyone care about the fate of family farms around the world? Lenin, founder of the Russian revolution said it best.

    “The Socialist Revolution in the US cannot take place because there are too many small independent farmers there. Those people are the stability factor. We here in Russia must hurry while our government is stupid enough to not encourage and support the independent farmership.” V. Lenin, the founder of the Russian revolution

    Quote provided by Anna Fisher

    The USA has had it’s farmers deliberately forced off their land starting in 1945. The reprecussions are seen thoughout US society today. Nicole does a good job of researching this: http://www.opednews.com/articles/History-HACCP-and-the-Foo-by-Nicole-Johnson-090906-229.html

    The World Trade Organization’s Agreement on Agriculture, the OIE “Good Farming Practices” and FAO “Good Agricultural Practices” Show the United Nations and WTO are taking aim at our privately owned food supply and that scares me.

  204. Peak Gold ??
    “Posted by Heading Out on November 14, 2009 – 10:16am
    “Topic: Supply/Production
    “Tags: gold [list all tags]

    “Yesterday the President of the largest gold mining and production company, Barrick Gold, noted that after ten years of declining production it is time to recognize that the world has seen the peak in gold production. To maintain production ore is being mined with increasingly less gold in it.”

    http://www.theoildrum.com/node/5960

    Of course, this could be viewed as a stratagem to increase the value of their stock…

  205. Another leftist telling people to grow up. Are these accusations of childishness particularly effective over at Huffpo or something?

    Anyway, I have an interest in eco-propaganda videos so I checked out thumb-twiddlers. Wow is that some world class stupid.

    Not bad on the energy stuff (the first half) but at the 17 minute mark it starts on what it casts as the great destroyer: economic growth. Unfortunately, these idiots don’t even know what economic growth IS.

    A doubling of GNP is not a doubling of STUFF. It is a doubling of VALUE. In particular, we are always learning to do more with less. Economic growth is not the road into a dead end, as this idiot video depicts, but is the reason there will not be a dead end, unless these anti-capitalist anti-growth leftists get their way.

    At the end the video advocates going back to pre-industrial living and opting out of the economy. WTF? I sure hope they aren’t showing this garbage in schools, but the thumb-twiddler claims otherwise.

  206. ThumbWind says:
    March 21, 2012 at 2:55 pm
    ….The best answer it what I found is posted here.

    http://thumbwind.com/2012/03/01/why-pursue-wind-energy-now/

    _________________________________
    And I was thinking of putting in alternate energy on my farm and found the best answer is here: http://www.windpowerfraud.com/

    Of all the ideas I looked at Horizontal Loop Geothermal heating/cooling was the only one that makes sense aside from thorium nuclear. http://www.dougrye.com/geothermal-heat-pumps-101.html

    As soon as Thorium Mini-nuclear power plants become available I will be out campaigning the neighborhood to get our coop to install one!

    …When people think of nuclear power, they typically think of something that is somehow unnatural, that is far from “green.” Wind, solar, biofuels, “renewables” are supposed to be green, right? However, upon careful scrutiny, we realize that “renewables” are not only not green—they’re worse for the environment than fossil fuels. And nuclear, in contrast, is not only the one and only “green” energy resource available, it is the one alternative available to fossil fuels, which are peaking and going into inexorable decline. When this gets out later this decade, it will become a scandal….

    Searching for a Miracle …. analyzes all primary energy sources based upon ten criteria, the most important being ‘net energy,’ or EROEI. In the case of wind, solar, and biofuels, the EROEI is so low, and for wind and solar the intermittency problem so huge, that these sources could actually increase fossil fuel use, and at very high cost.

    Food production is energy intensive, which is why biofuels are such a joke…

    http://www.examiner.com/renewable-energy-in-eugene/is-nuclear-power-green

    The article is worth a read.

  207. Every article posted by Alec Rawls here diminishes the credibility of WUWT. A shame to sully this fine website with his constant stream of garbage.

  208. I would only engage in rational disputation with credible posters. You are not such a person.

  209. And yet you cannot come up with anything I have said that is not credible. I don’t think you can. I don’t think you have any capacity to discern what is credible or not, and if you attempt it, that incapacity will be exposed.

  210. Dude, the fact that you can’t accept someone’s opinion of you and move on just shows how insecure you are. I think you actually know how lacking in credibility you are, and as a result have a giant chip on your shoulder. Show some introspection and ask yourself why you present yourself like this, not just to me, but to anyone who points out your obvious failing. My comment wasn’t even directed at you, but to Anthony as feedback for his website. You’re beyond reclamation, but Anthony is not. He makes mistakes and learns from them. I don’t ever expect you to admit to having made any mistakes at all, and won’t waste my time pointing them out.

  211. I have so many obvious failings, yet Conrad says it would be a drain on his time to point out anything I have said that he can actually contest. Quite clearly Conrad has no actual substantive criticism in mind, or he would state it, like other people do.

  212. It’s such fun to watch you flail about to no purpose, why spoil things with anything more substantive? Nor is it even necessary to demonstrate my point. You keep doing that all on your own, and fail to see the absurdity of your efforts. Ask yourself why you even care what I think of you? Show some dignity at the very least.

  213. The pointless ad hominems do not become either of you or this site. It adds nothing to the discussion.

  214. Gail: I haven’t said anything ad hominem about Conrad. I just suggested that if he had a substantive criticism he would make it. Was I not gentle enough in my prodding?

    It actually is to a point. I figure the guy’s a concern troll. You know, those people who pretend to be conservatives or skeptics or whatever and say how dismayed they are about the direction that actual conservatives or skeptics are taking.

    Since they don’t actually know the subject, they can’t articulate any substantive criticisms. That certainly fits Conradg. If he is a concern troll, I think its worth a little effort to out him.

    And Conrad, if you are not a concern troll, it ought to bother you at least a little bit that you act exactly like one.

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