BREAKING: Gov. Mike Pence rumored to Make his Endorsement Today on Greg Garrison show.
Mike Pence might be about to make an endorsement announcement today.Read More »
Excerpts and commentary below the fold…
Chavez’s death leaves big questions about the country’s massive oil reserves. Production efforts are currently down in Venezuela, and have declined by more than 20% since 1998. Although state-run oil company Petróleos de Venezuela (PDVSA) is expected to increase that production, it’s likely to have little effect on icy relations between the South American country and the United States.
Vice President Maduro, a Chavez loyalist, is expected to secure victory in the coming, constitutionally-mandated election. He had been endorsed by Chavez for successor, and is considered popular among the electorate and the state military. His opponent will likely be Henrique Capriles, who also ran against Chavez in 2012. …
Chavez’s use of Venezuelan oil resources is also controversial. Oil initially thrived within the Venezuelan economy under Chavez’s rule. The country is believed to have the largest oil reserves in the world, and Chavez grew PDVSA during his time in office. High oil prices brought billions into the country; meanwhile Chavez began kicking U.S. E&P companies out.
Oil gave Chavez the ability to buy the loyalty of Venezuela’s poor (gasoline is a government-subsidized $0.18/gallon there, the cheapest consumer price in the world) and the friendship of the Castros in Cuba. Without oil, Chavez would have been just another Latin American thug, like Manuel Noriega but with a better complexion. As for the Hollywood Left, they never met a Socialist strongman they didn’t like.
Blast from the past: Deadbeat Chavez Takes One From ACORN’s Playbook
[Gina] McCarthy led Connecticut’s Department of Environmental Protection from 2004 to 2009. She also held senior roles in Mitt Romney’s administration when he was Massachusetts governor a decade ago, but her selection for the top EPA job is likely to bring criticism from GOP lawmakers.
As the EPA’s senior air regulator, she has played a key role in the crafting of air pollution rules that have drawn praise from public health groups, but Republican opposition. …
[Ernest] Moniz, however, will face some oppositionfrom green groups over his support for natural gas and the controversial drilling procedure known as “fracking.”
The Energy nominee has argued that natural gas can play a role in helping curb greenhouse gas emissions, but that stance has angered activists who believe fracking harms the nation’s water supplies.
The U.S. branch of Greenpeace criticized Moniz when reports last month suggested he could be a possible replacement for Chu. But many of the largest and most politically connected environmental groups, including the National Wildlife Federation, Natural Resources Defense Council and the Environmental Defense Fund, have not expressed concerns over his selection.
Any nominee opposed by Greenpeace can’t be all bad. In any case, the press has never really caught on that it’s the policies of the Department of the Interior and the EPA that really drive U.S. energy policy, not the Department of Energy.
Exxon Mobil Corp. will increase its annual spending on energy projects by $1 billion, Chairman and CEO Rex Tillerson said in the company’s annual analyst meeting in New York.
The increase will bring capital spending levels to about $190 billion over the next five years, or $38 billion per year, a new record for the oil giant.
“I never would have dreamed I’d be spending at this level,” Mr. Tillerson said.
Mr. Tillerson said the company’s production of oil and other liquids is expected to increase by an average of 4% per year from 2013 through 2017 as Exxon starts production at 28 major oil and gas projects, 24 of which are heavy in liquids. New production startups in the next five years will total about one million oil-equivalent barrels, Mr. Tillerson said.
Mr. Tillerson’s emphasis on oil production over natural gas reflects the low natural-gas prices that have hit North America in the past few years. The company has been criticized by investors for its 2010 purchase of XTO Energy Inc., which made it the largest natural gas producer in the U.S. just before prices plummeted due to overproduction.
For further reading, see: “Oil Company Profits Are the Solution, Not the Problem”, a RedState post from May, 2011. The two main takeaways from that post:
Hating Big Oil is part of the American birthright, dating back over 100 years:
In the absence of antitrust laws, the story goes, Standard [Oil, the ancestor of Exxon and most of the large American oil companies] attained a 90% share of the oil-refining market through unfair and destructive practices such as preferential railroad rebates and “predatory pricing”; Standard then leveraged its unfair advantages to eliminate competition, control the market, and dictate prices. In [journalist Henry Demarest] Lloyd’s words, Standard was “making us pay what it pleases for kerosene.”
Was it? In 1865, when Rockefeller’s market share was still minuscule, a gallon of kerosene cost 58 cents. In 1870, Standard’s market share was 4%, and a gallon cost 26 cents. By 1880, when Standard’s market share had skyrocketed to 90%, a gallon cost only 9 cents — and a decade later, with Standard’s market share still at 90%, the price was 7 cents. These data point to the real cause of Standard Oil’s success — its ability to charge the lowest prices by producing kerosene with unparalleled efficiency.
The fact is, we Americans are voracious energy consumers, but most of us resent the very companies that satisfy our demands.
The study, which brought together the related research in engineering, geoscience and economics, examined on a well-by-well basis production data from over 16,000 individual wells in the Barnett play through mid-2011. The study results indicate significant recoverable resources remain in the Barnett play, with total recovery at greater than three times cumulative production to date.
The study’s base case forecasts the Barnett, at a base price of $4 per thousand cubic feet of gas, will produce approximately 44 trillion cubic feet (Tcf) of gas through 2050 based on already drilled wells and well that will be drilled through 2030. In the base case, production will plateau from a current high of 2 Tcf per year and slowly decline to about 900 billion cubic feet per year by 2030.
This is just the first of several shale studies conducted by the Bureau of Economic Geology at the University of Texas. This one highlights the “sweet spots” in the Barnett and provides an economic model to predict future development under various price scenarios. The Barnett is the most mature of the major shale gas plays and is only now peaking in deliverability at roughly 2 TCF/year (compared to total U.S. production of about 24 TCF/yr).
U.S. Sen. Mary Landrieu has asked the Environmental Protection Agency to lift its November suspension of oil company BP’s ability to secure new federal contracts, including oil leases in the Gulf.
Landrieu, D-La., said the EPA doesn’t have the authority to regulate the oil and gas industry and that what she considers arbitrary action against BP could “have a chilling effect” on other companies’ desire to drill in the Gulf.
“I’m furious and strongly opposed to the EPA’s authority for suspension and disbarment,” Landrieu said Tuesday. “I’m angry that this agency would put a business in a situation of what amounts to double jeopardy.”…
Landrieu’s “double jeopardy” comment refers to BP’s agreement late last year to settle criminal charges for $4.5 billion. A civil trial relating to the [Deepwater Horizon] accident is under way in New Orleans. …
“BP should be penalized and make people whole, but this is bigger than BP and even the oil and gas industry,” she said. “I’m not on BP’s negotiating team. As a senator I’m concerned that in a climate of over regulation (the EPA) came out of the blue and slapped a suspension and disbarment without notice and without any clear guidance.”
Landrieu said when she asked the EPA what BP has to do, “they said they can’t share that and weren’t sure. I’m trying to find out what other risks companies might have doing business in Louisiana.”
Sen. Landrieu is a Blue Senator, up for reelection in 2014 in what has become a very Red State. Energy state democrats have become something of an endangered species. But there’s something about Mary: she’s no dummy. She knows upon which side her bread is buttered, and as a result, she is one of the energy industry’s most reliable voices on Capitol Hill.
Neftegaz America Shelf LP (Neftegaz), an indirect independent subsidiary of Rosneft, acquires 30 percent interest in 20 deepwater exploration blocks in the Gulf of Mexico held by ExxonMobil, under an agreement signed by the two companies.
The 20 blocks have a total area of approximately 111,600 acres (450 square kilometers) in water depths ranging between 2,100 and 6,800 feet (640 and 2,070 meters). Seventeen are located in the Western Gulf of Mexico and three are in the Central Gulf of Mexico.
ExxonMobil retains 70 percent interest in the blocks and remains operator. Analysis of seismic data is under way. There is currently no production on the blocks.
And who’s Rosneft, one might ask:
Rosneft is the leader of Russia’s petroleum industry, and ranks among the world’s top publicly traded oil and gas companies. The Company is primarily engaged in exploration and production of hydrocarbons, production of petroleum products and petrochemicals, and marketing of outputs. Rosneft has been included in the Russian Government’s List of Strategic Enterprises and Organizations. The state holds 75.16% in the Company (through OJSC ROSNEFTEGAZ), while approximately 15% of shares are in free-float …
Cross-posted at stevemaley.com.