• 4 minutes What will the future hold for nations dependent on high oil prices.
  • 7 minutes Paris Is Burning Over Climate Change Taxes -- Is America Next?
  • 12 minutes OPEC Cuts Deep to Save Cartel
  • 15 minutes Venezuela continues to sink in misery
  • 2 hours End of EV Subsidies?
  • 2 hours Maersk's COO statment.
  • 7 hours Citi cuts Apple's price target
  • 8 hours Asian stocks down
  • 3 hours Japan Effectively Bans China’s Huawei, ZTE From Government Contracts, Joining U.S
  • 5 hours USGS Announces Largest Continuous Oil Assessment in Texas and New Mexico
  • 1 hour GOODBYE FOREIGN OIL DEPENDENCE!!
  • 13 hours China Builds LNG Icebreaker
  • 4 hours Oil prices may go up, but will be below $70 a barrel in FY19: Hindustan Petroleum Chairman
  • 15 hours EPA To Roll Back Carbon Rule On New Coal Plants
  • 13 hours Price Decline in Chinese Solar Panels
  • 5 hours Regular Gas dropped to $2.21 per gallon today
Alt Text

The U.S. Pipeline Industry Is Booming

U.S. oil and gas production…

Alt Text

OPEC+ Gears Up For Production Cuts

Oil prices rose once again…

Alt Text

Is The Saudi-Russia Oil Bromance At Risk?

Russia and Saudi Arabia are…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Trending Discussions

The Value of Empty Space - Japan Secures Oil Supply

Here's an interesting one in the realm of oil security.

As we've discussed, Japan is using a lot less oil these days. In the last year, Japanese consumption dropped 800,000 barrels per day.

That's leaving the country's petroleum infrastructure under-used. Nippon Oil plans to idle 20% of its refineries by 2015.

Oil storage facilities are also sitting empty. And the Japanese government is getting creative in putting this "empty space" to productive use.
The plan is to use spare storage to guarantee secure oil supply.

The pilot for this scheme came in June 2009. Japan's Ministry of Economy, Trade and Industry signed an agreement to "borrow" 600,000 kiloliters (3.8 million barrels) of oil storage from Nippon Oil (no terms have been released for the agreement).

The government then turned around and offered the storage space to Abu Dhabi National Oil Corporation. On very favorable terms (it's unclear if ADNOC is being charged at all for the space).

On December 21, ADNOC delivered its maiden shipment of 300,000 kiloliters of Abu Dhabi crude to the facility. The firm will use Japan as a "foothold" in Asia to conduct oil trading. Having oil stocks closer at hand to China, Japan and other Asian nations allows ADNOC to act quickly when attractive prices appear in these markets.

Here's the kicker. In exchange for providing storage, Japan gets priority purchase rights in case of an energy emergency. If oil suddenly gets scarce, the Japanese have dibs on nearly 4 million close-at-hand barrels.

Not a bad use of empty space.

Here's to making something from nothing.

By. Dave Forest of Notela Resources




Back to homepage

Trending Discussions


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
-->