Energy / Crude Oil

• Uganda’s Oil Opportunity

  Uganda’s recent oil discovery has the chance to reshape relations with its neighbours and the West as energy multinationals eye potential opportunities. The Great Rift Valley of East Africa - the birthplace of humankind - holds a reservoir of billions of barrels of untapped oil. Over the last four years, UK-based oil exploration and production company Tullow Oil has discovered reserves of nearly 2 billion barrels of oil in rural western Uganda, with the largest finds in the Lake Albert Basin. In what is now being called the largest onshore oil discovery in sub-Saharan Africa in 20 years, Tullow believes…

• High Hurricane Activity Threatens Gulf Oil Production, Cleanup Efforts

  As hurricane season begins in the Caribbean and Gulf of Mexico, forecasters are predicting higher-than-usual activity that could disrupt oil and gas production in the Gulf and hinder efforts to clean up the Deepwater Horizon oil spill. The U.S. Energy Information Administration said Tuesday that forecast hurricane activity could reduce Gulf oil production by 26 million barrels and natural gas production by 166 billion cubic feet. This compares with the median reduction of 5.8 million barrels of oil and 39.5 billion cubic feet of gas in a typical hurricane season. The EIA forecasts are based on the latest predictions of…

• The Death of BP?

  It was about six weeks ago that the man I work for walked into my office and asked what was happening in the world of energy. “This oil leak in the Gulf of Mexico”, I told him, “is going to be a monumental disaster.” He hadn’t heard about it yet, but my views on it at the time were 1). They weren’t going to have an easy time getting the leak stopped; 2). It would drastically shift the debate on offshore drilling. I published an essay on the spill shortly after it happened in which I predicted that this would…

• Big Oil is Paying

  In 2006, when I wrote this, and culled directly from their 10K, ExxonMobil paid $30.7 billion in excise taxes, $41.6 billion in other "taxes and duties", and $59.4 billion in income taxes… or, in other words, $131 billion in taxes on $359 billion in Revenue and $36 billion in Net Income.  Thus, taxes were 364% of Net Income and 36.5% of Revenue, while Net Income was 10% of Revenue.  In other words,  taxing entities of all sorts made $3.65 per every $1.00 of profit booked by ExxonMobil shareholders.  Isn't this a 78.5% effective overall tax rate? It wasn’t just ExxonMobil. …

• Middle East producers see more heavy oil in their future

  Middle East oil countries should increase production of heavy oil as oil prices remain higher and improved technology makes it easier, those attending an industry conference in Bahrain were told. Bahrain’s oil minister, Abdulhussain Mirza, told the Heavy Oil World MENA conference that heavy oil reserves in the region were estimated at 1 trillion barrels, or 28% of total world reserves, but historically accounted for little more than 10% of production. “The vast reserve demonstrates the importance of heavy oil as a future energy source, one that cannot be overlooked and, therefore, companies that position themselves early in the heavy…

• Our Unhealthy Addiction to Oil

  The Deepwater Horizon disaster in the Gulf of Mexico is providing barrels of new ammunition to pundits on both the Right and the Left who contend we have to end our “addiction” to oil. Repeating this meme – which we’ve been hearing non-stop since George W. Bush used it in his 2006 State of the Union speech -- allows pundits to sound professorial and rational. The term “addiction” is a loaded term that appeals directly to the self-help/self-improvement genre that Americans are predisposed to accept. Upon hearing that word, the supposed cures are easy to foretell: we must give up…

• Canada’s Oil Sands Set to Become Biggest Source of U.S. Oil Imports, Report Says

  Canadian oil sands will probably become the No. 1 source of U.S. crude oil imports this year, and could make up more than a third of the nation’s oil and refined product imports by 2030, according to a new study. The Role of Canadian Oil Sands in U.S. Oil Supply, a report from Cambridge, Mass.-based IHS CERA, says that in a fast-growth scenario, oil sands could represent 36% of oil imports by 2030, or 20% in a more moderate growth scenario, compared with 8% in 2009. Production of 1.35 million barrels per day (mbd) in 2009 could rise to between…

• Greenland Proceeds with Plans for Offshore Drilling in Arctic Waters

  While the oil spill from a sunken drilling rig in the Gulf of Mexico threatens to become an environmental disaster, plans are proceeding for opening up new drilling territories in the iceberg-infested waters off Greenland. The island, an autonomous territory under Danish sovereignty, this week conducted an auction for 14 blocks in Baffin Bay, off the northwest coast of Greenland near Canadian territorial waters. Results will be announced in August. In the meantime, Cairn Energy will this summer begin drilling off Disko Island in Baffin Bay on the basis of leases awarded in earlier auctions. Exxon Mobil and Chevron also…

• Gulf Oil Spill Threatens Halt to White House Offshore Drilling Plans

  The oil spill in the Gulf of Mexico from a collapsed offshore drilling rig could affect White House plans to extend offshore drilling, press secretary Robert Gibbs acknowledged as the oil slick threatened onshore sites from the Louisiana wetlands to the Sarasota beaches and disrupted fishing and energy industries. As oil giant BP mobilized resources to try to stop the leak and to mitigate its damage, President Barack Obama called the spill “potentially unprecedented environmental disaster.” However, some critics charged that the administration’s slow response to the rig accident and Obama’s decision to take part in the humorous proceedings at…

• Where would we be without offshore oil?

  As oil continues to pour into the Gulf of Mexico, I thought it might be helpful to review how we got where we are today. The graph below shows total U.S. consumption of petroleum products (in red) and oil production from U.S. fields (in green). Consumption has been growing pretty steadily since 1981 while production has been declining. About 3-1/2 million barrels per day of the gap between these two lines is made up by refinery process gain, natural gas plant liquids, and other liquids. But most of the gap must be met by U.S. imports. Each year that our…