Bonus From Single Alberta Auction Hits Lowest Level Since November 2002
Wednesday’s Alberta land sale brought in the lowest overall bonus since November 2002 as the total, including bidding on four oilsands parcels, brought in just $15.38 million.
The last time Alberta collected less than $16 million from an overall land sale was the Dec. 11, 2002 auction that collected just $15.78 million, including rights to one Metis parcel. The lowest total of 2002 was the $10.29 million collected in the Nov. 27 auction of that year.
Wednesday’s land sale drew just $15.38 million overall or about $218 per hectare for rights to 70 689 hectares. According to Daily Oil Bulletin records, the per-hectare price on Wednesday was the lowest since the April 21, 2004 auction, when the average was just under $197 per hectare.
Rights to conventional leases on 26 401 hectares brought in just $9.16 million or an average of about $347 per hectare in Wednesday’s sale. Conventional licences on 43 264 hectares attracted just under $4.72 million or an average of $109 per hectare. Four oilsands parcels drew just $1.5 million or an average of $199 per hectare for rights to 1 024 hectares.
From Nickle's Daily Oil Bulletin
Friday, November 30, 2007
Thursday, November 29, 2007
Nuclear Power Touted As Steam Source For SAGD
By Elsie Ross, from Nickle's Daily Oil Bulletin
Small-scale high temperature gas nuclear plants could potentially replace natural gas to produce the steam required for SAGD (steam assisted gravity drainage projects) in Alberta, an oilsands conference heard Tuesday.
Two German-designed Pebble Bed Modular Reactors (PBMR) could support 100,000 bbls per day of bitumen production in addition to generating electricity, said Reiner Kuhr, a mangement consultant promoting the technology. The size of the reactor tends to match increments of SAGD expansions of 50,000 bbls per day, producing as much steam as two or three conventional gas-fired generators, he said.
However, before any nuclear plant is built in Alberta there is a need for a regional energy policy and support from industry and government, Kuhr and Ashley Finan, a graduate student in nuclear engineering at the Massachusetts Institute of Technology (MIT) told the Canadian Institute conference. "Right now there is no stability with respect to nuclear so that someone coming in asking to build a nuclear plant has no idea what the policy is or how the province will react," said Finan who recently was part of study that looked at the potential for nuclear power in the Alberta oilsands.
The 500-megawatt thermal PBMR is similar in scale to two 70A gas turbines, said Kuhr, a senior executive consultant Shaw Stone & Webster Management Consultants. "Whatever you can do with two 70As you can do with one PBMR reactor by putting the right equipment on the back-end to make steam or power."
For SAGD, the reactor could produce high-pressure steam that would require only the reactor and some heat exchangers and boilers. At a relatively high temperature of 720 C. for the helium gas, PBMR reactors can run super critical steam cycles, very high efficiency cycles and produce about 200 megawatts of electricity, he told the conference.
The PBMR plant also includes passive safety features which are a step-change over Canadian-made CANDUs and other light water reactors, said Kuhr. A major advantage is that this enables them to be located very close to other industrial facilities such as pipelines or upgraders compared to the CANDUs which require a large exclusionary area, he said.
The PBMR reactor requires a very small amount of material that must be dealt with in terms of fuel production and ultimate disposal, the conference heard. Each of the fuel spheres is about the size of a billiard ball and holds about 20 megawatt hours of energy compared to about one kilowatt hour of energy from a pound of coal or petroleum coke.
In terms of economics, starting with $7 per mmBtu gas and an escalating price over 30 or 40 years, a nuclear reactor could represent net present value savings of $1 billion to $2 billion in natural gas, said Kuhr. There also is value in the CO2 displacement which at the current value of $15 per tonne would amount to about $200 million, said Kuhr.
While the PBMR reactor would be less expensive than a $5 billion or $6 billion CANDU because it is smaller, "the nuclear industry really requires a lot more than a business model, it requires some kind of market pull and public acceptance," he said.
Kuhr was to meet today in Calgary with some industry players to discuss what the industry needs and their reaction to the potential opportunity.
However, even with support from government and industry, the earliest plant construction could begin would be 2013-2014 with 2017 start-up date, he said. That means that any new nuclear reactor would serve a new generation of oilsands projects rather than those already in the planning stages
Replacing natural gas with nuclear energy for oilsands projects offers a number of benefits, including significant reductions in carbon dioxide production while preserving gas for exports, said Finan.
In addition to the PBMR reactor, the MIT study included the Advanced CANDU Reactor (ACR), the next generation reactor which Energy Alberta wants to build at Peace River to provide electricity, and the Enhanced CANDU 6 reactor (current technology). Nuclear power would provide greater price stability for oilsands developments because the price of uranium accounts for a much smaller proportion of the total cost than does natural gas, said Finan. Uranium is also a Canadian resource, she noted.
The study looked at the use of nuclear power to provide steam and electricity for SAGD, and steam, electricity and hot water for surface mining and upgrading.
The most interesting potential application for the CANDU reactors is in the Athabasca oilsands carbonates where there has been discussion about using electrical heating to recover the resources, said Finan. "That would require a lot of electricity and the CANDU is a better size for that."
A CANDU reactor also would be about the right size for a 200,000 bbl per day surface mine with an upgrader and 250 megawatts of electricity on the grid. It would not provide hydrogen for the upgrader.
In analyzing the economics of nuclear power in comparison to natural gas for steam production, the study found that based on available cost information, nuclear energy is in the ballpark with a break-even gas price of $6.75 per mmBtu. Electricity from nuclear power is more expensive which is to be expected given the capital costs for plants, becoming competitive with natural gas plants at gas prices of between $10 and $13 per mmBtu. "We were happy just to be in the ballpark," she said.
The main environmental advantage would be the reduction in CO2 emissions with a savings of about three million metric tonnes per year and about 131 million metric tonnes over the lifetime of a 100,000 bbl per day SAGD facility.
A major challenge for nuclear power in Alberta is public opinion, especially considering the fact there currently are no plants in the province as it has been found persons familiar with nuclear power tend to be more supportive of it, she said.
Small-scale high temperature gas nuclear plants could potentially replace natural gas to produce the steam required for SAGD (steam assisted gravity drainage projects) in Alberta, an oilsands conference heard Tuesday.
Two German-designed Pebble Bed Modular Reactors (PBMR) could support 100,000 bbls per day of bitumen production in addition to generating electricity, said Reiner Kuhr, a mangement consultant promoting the technology. The size of the reactor tends to match increments of SAGD expansions of 50,000 bbls per day, producing as much steam as two or three conventional gas-fired generators, he said.
However, before any nuclear plant is built in Alberta there is a need for a regional energy policy and support from industry and government, Kuhr and Ashley Finan, a graduate student in nuclear engineering at the Massachusetts Institute of Technology (MIT) told the Canadian Institute conference. "Right now there is no stability with respect to nuclear so that someone coming in asking to build a nuclear plant has no idea what the policy is or how the province will react," said Finan who recently was part of study that looked at the potential for nuclear power in the Alberta oilsands.
The 500-megawatt thermal PBMR is similar in scale to two 70A gas turbines, said Kuhr, a senior executive consultant Shaw Stone & Webster Management Consultants. "Whatever you can do with two 70As you can do with one PBMR reactor by putting the right equipment on the back-end to make steam or power."
For SAGD, the reactor could produce high-pressure steam that would require only the reactor and some heat exchangers and boilers. At a relatively high temperature of 720 C. for the helium gas, PBMR reactors can run super critical steam cycles, very high efficiency cycles and produce about 200 megawatts of electricity, he told the conference.
The PBMR plant also includes passive safety features which are a step-change over Canadian-made CANDUs and other light water reactors, said Kuhr. A major advantage is that this enables them to be located very close to other industrial facilities such as pipelines or upgraders compared to the CANDUs which require a large exclusionary area, he said.
The PBMR reactor requires a very small amount of material that must be dealt with in terms of fuel production and ultimate disposal, the conference heard. Each of the fuel spheres is about the size of a billiard ball and holds about 20 megawatt hours of energy compared to about one kilowatt hour of energy from a pound of coal or petroleum coke.
In terms of economics, starting with $7 per mmBtu gas and an escalating price over 30 or 40 years, a nuclear reactor could represent net present value savings of $1 billion to $2 billion in natural gas, said Kuhr. There also is value in the CO2 displacement which at the current value of $15 per tonne would amount to about $200 million, said Kuhr.
While the PBMR reactor would be less expensive than a $5 billion or $6 billion CANDU because it is smaller, "the nuclear industry really requires a lot more than a business model, it requires some kind of market pull and public acceptance," he said.
Kuhr was to meet today in Calgary with some industry players to discuss what the industry needs and their reaction to the potential opportunity.
However, even with support from government and industry, the earliest plant construction could begin would be 2013-2014 with 2017 start-up date, he said. That means that any new nuclear reactor would serve a new generation of oilsands projects rather than those already in the planning stages
Replacing natural gas with nuclear energy for oilsands projects offers a number of benefits, including significant reductions in carbon dioxide production while preserving gas for exports, said Finan.
In addition to the PBMR reactor, the MIT study included the Advanced CANDU Reactor (ACR), the next generation reactor which Energy Alberta wants to build at Peace River to provide electricity, and the Enhanced CANDU 6 reactor (current technology). Nuclear power would provide greater price stability for oilsands developments because the price of uranium accounts for a much smaller proportion of the total cost than does natural gas, said Finan. Uranium is also a Canadian resource, she noted.
The study looked at the use of nuclear power to provide steam and electricity for SAGD, and steam, electricity and hot water for surface mining and upgrading.
The most interesting potential application for the CANDU reactors is in the Athabasca oilsands carbonates where there has been discussion about using electrical heating to recover the resources, said Finan. "That would require a lot of electricity and the CANDU is a better size for that."
A CANDU reactor also would be about the right size for a 200,000 bbl per day surface mine with an upgrader and 250 megawatts of electricity on the grid. It would not provide hydrogen for the upgrader.
In analyzing the economics of nuclear power in comparison to natural gas for steam production, the study found that based on available cost information, nuclear energy is in the ballpark with a break-even gas price of $6.75 per mmBtu. Electricity from nuclear power is more expensive which is to be expected given the capital costs for plants, becoming competitive with natural gas plants at gas prices of between $10 and $13 per mmBtu. "We were happy just to be in the ballpark," she said.
The main environmental advantage would be the reduction in CO2 emissions with a savings of about three million metric tonnes per year and about 131 million metric tonnes over the lifetime of a 100,000 bbl per day SAGD facility.
A major challenge for nuclear power in Alberta is public opinion, especially considering the fact there currently are no plants in the province as it has been found persons familiar with nuclear power tend to be more supportive of it, she said.
Wednesday, November 28, 2007
Ethanol Craze Cools as Doubts Multiply
The burgeoning Alberta Ethanol Pork-Barrel is already tired, not wired! Biofuels are already "so yesterday". Click below for the whole article.
Ethanol Craze Cools as Doubts Multiply
Claims for Environment,Energy Use Draw Fire;Fighting on the Farm
By LAUREN ETTER
November 28, 2007; Page A1
Little over a year ago, ethanol was winning the hearts and wallets of both Main Street and Wall Street, with promises of greater U.S. energy independence, fewer greenhouse gases and help for the farm economy. Today, the corn-based biofuel is under siege.
In the span of one growing season, ethanol has gone from panacea to pariah in the eyes of some. The critics, which include industries hurt when the price of corn rises, blame ethanol for pushing up food prices, question its environmental bona fides and dispute how much it really helps reduce the need for oil.
The Fallout Continues
CNRL layoffs announced today. No official word on the number. This was sent to CNRL employees this morning:
From: Allan Markin
Sent: Wednesday, November 28, 2007 11:11 AM
To: Exchange Users
Subject: From the Desk of Allan Markin
Good morning, We regret to inform you that this morning Canadian Natural released a small number of employees and contractors.
We are sure you can appreciate that we are operating in a quickly changing economic environment. Natural gas prices, which represent a significant portion of our business, have declined over the past year and are not expected to improve much over the coming year. The rising Canadian dollar has meant we have received less for our products since they are priced in US dollars. Pressure on the cost of goods and services, on general and administrative (G&A) expenses, and on the cost of capital projects has further challenged our industry. Adding to this, the royalty structure within Alberta will be changed, further reducing the profitability of many of our investments.
These are the realities which we face, much of which we have little to no control over. But we will not sit back and let events over take us.
Today’s decisions were difficult, but necessary to adjust our business to these economic challenges, and are intended to ensure we are staffed appropriately to move into the future. Our Management Committee takes no pleasure, at any time, in making these kinds of decisions. But when it is necessary, I can assure you that we do it right, and with integrity.
We remain very confident in our success, and in the opportunities ahead of us. We are better positioned than any of our peers to develop and grow our business for many years to come. We have the right people, the right projects, and the right plans to continue building Canada’s most successful exploration and production company, despite the previously mentioned challenges facing the entire oil and natural gas industry.
$70US Price Floor?
Note this study is based on old royalty regimes; and likely relatively light on current capital costs. They are escalating so rapidly using data only six months old would make for a considerably more optimistic case than reality.
The results are shocking, but I think true. Amazing that an industry that was doing OK only a few years ago at $30/bbl needs over twice that much now.
The results are shocking, but I think true. Amazing that an industry that was doing OK only a few years ago at $30/bbl needs over twice that much now.
Oil, gas explorers feeling pressure of new price floor
Claudia Cattaneo, Financial Post Published: Wednesday, November 28, 2007
CALGARY - Oil and gas explorers around the world need US$70 a barrel oil on a sustained basis to make the returns they were making only a couple of years ago with oil prices at US$30, according to a study by international energy research firm Wood Mackenzie.
Rising costs for equipment, lack of access to many basins and more challenging plays have elevated prices needed to earn a return of 15% on exploration, Andrew Latham, vice-president of exploration service, said from Edinburgh, where the firm is based.
"Things have changed quite quickly," he said. "What we are seeing is the equivalent of a new price floor for explorers, and the US$30 that worked two or three years ago certainly doesn't work anymore."
The higher floor price is contributing to the higher price of oil, he said.
The study, based on an analysis of conventional exploration in 400 basins around the world, found the cost of drilling alone has risen by 60% since 2004. Mr. Latham said the basins hit hardest are those in deep waters, such as the Gulf of Mexico, offshore West Africa and Brazil, where there is a shortage of all types of equipment, from drilling rigs to floating production facilities.
With governments around the world nationalizing their oil industry, exploration companies have access to a relatively minor fraction of the undiscovered oil and gas potential, he said.
That means they're being pushed into more challenging plays in areas that are accessible but that take more technology, more money and more time to develop, he said.
Still, Mr. Latham said he doesn't see oil and gas companies backing off on exploration because they lack alternatives.
Oil and gas companies "are going to have to get used to achieving relatively modest returns, even though the oil and gas prices are very high, … because the alternatives are pretty challenging as well," Mr. Latham said. "If you are looking to develop discovered resource, which involves negotiating with the host governments, the terms of those deals are much tougher than they used to be."
The study included exploration activity in the Canadian Arctic and in Newfoundland's offshore, but not in Western Canada, where the oil-and-gas industry tends to be focused on resource plays that have a high chance of finding hydrocarbons, rather than exploration where the chances of success are small.
The study doesn't factor in changing fiscal terms under way around the globe that have yet to impact on explorers' revenues and will continue to push up the floor price needed by the sector.
"The majority of recent exploration is based around licenses which were negotiated in the 1960s, with fiscal terms more favourable than could be negotiated today," Mr. Latham said.
ccattaneo@nationalpost.com
$800 mm ATB Bailout
Remember the recent decision to contribute another $2 billion to bail out the ATA's pension shortfall? This was on top of the previously agreed amount of over $4 billion.
And now this. Note the article suggest that the $800mm quiet bailout might not be the end, either.
In any other province a government throwing money around like that might create a some waves. Not in Alberta though.
And now this. Note the article suggest that the $800mm quiet bailout might not be the end, either.
In any other province a government throwing money around like that might create a some waves. Not in Alberta though.
Cracks show in people's bank
Finance minister fumes over investment woes of Alberta Treasury Branch
Tuesday, November 27 2007
By NEIL WAUGH, EDMONTON SUN
ATB Financial's CEO Dave Mowat calls it a "major bump in the road."
Alberta Finance Minister Lyle Oberg - who should be Mowat's boss, but isn't allowed to be under some goofy Alberta Tory legislation - is a little less optimistic.
He branded the $1.2-billion hole in the government-owned financial institution's books revealed this week as a "liquidity crisis".
And as such, Alberta finance has quietly pumped in $800 million to paper over the cracks in the people's bank, which is a holdover from the old Social Credit funny money days.
While Mowat insists the provincial government "has full confidence in ATB's board of directors and management," it's pretty clear that Oberg is not a happy camper.
Especially when he confessed how Alberta Treasury Branches brass got themselves into such a mess with our money by investing in dubious financial instruments called "asset-backed commercial paper."
"This is all part of the subprime," Oberg said about the U.S. real estate crash and the financial meltdown it's creating in its wake.
"It's wrapped up in the commercial paper."
And while management told Oberg that the junk paper, which presently has no market, is "some of the best," ATB is part of a group called the Montreal Accord that has agreed to a "standstill period" until Dec. 14 while they try to figure out what to do with the stuff.
"I questioned them significantly exactly where they are at," Oberg said after ATB took a $79.6 million write-down, which Mowat described as a "serious financial event."
"I don't want them coming back and saying we've had to do another write-down."
IS HE LOW-BALLING?
Even though the depositors' losses that ATB are admitting to so far are only 6.9%, Oberg fears Mowat may be low-balling the red ink after some Canadian banks made provision for write-offs of 25%.
"We have a relatively clean set of holdings," the ATB report insisted. Which are "almost entirely free" of subprime content.
Instead, Mowat and his Tory-appointed board sunk the peoples' money into "third-party" paper for car loans, credit card receivables and credit default swaps.
Now that's blue chip.
And ATB brass admitted they did it because the paper had the "added benefit" of higher returns than bank-backed commercial paper.
I wonder why?
"I wouldn't say I was alarmed," Oberg winced. "But I was surprised."
And then there's the Alberta Treasury Branches' own "principle of diversification."
Mowat's question-and-answer discussion admits that would "contradict investment advice ATB would give to its own clients."
That's considering that "a third of ATB's liquid assets" are tied up in this fiasco.
"What was not anticipated was that the entire market for ABCP (asset-backed commercial paper) would cease trading," the ATB document sputtered.
Of course, ATB is also about to take an unspecified financial bath in the Ranchers Beef collapse, which was propped up with $100 million in loans, mostly from government agencies, in what former president Tony Martinez described as a "government policy."
'AN EXCELLENT YEAR'
"ATB Financial continues to have an excellent year," Mowat blustered in his second quarter financial report.
Alberta NDP leader Brian Mason isn't about to take the CEO's word for it.
Mason spat, "It smells like we've got a number of problems coming home to roost.
"As a result of the patronage appointments of the Conservatives to the board exposed the ATB very substantially."
"There's maybe over a billion dollars of exposure here," he continued.
"I think it would be worthwhile for the auditor general to take a look at this situation."
Mason described the ATB as a "wonderful organization."
But he reminded Oberg: "It was built with the hard work and sweat of Albertans, not by Tory patronage appointments.
"People put their hard-earned money into the treasury branch," he continued.
"Like any financial institution, they deserve the very best stewardship of that money.
"I would like to have a second opinion," Mason winked.
It's time for Alberta's favourite fireman - Auditor General Fred "Get 'er" Dunn - to pay a little visit to the ATB Tower.
Tuesday, November 20, 2007
US Mortgage Meltdown Accelerates
This is a very bad omen:
Freddie Mac shares tumble 26%
MARCY GORDON
The Associated Press
November 20, 2007 at 11:24 AM EST
WASHINGTON — Freddie Mac, the No. 2 buyer and guarantor of home loans in the U.S., lost $2-billion (U.S.) in the third quarter and said Tuesday it must raise fresh capital to meet regulatory requirements. Its shares fell more than 26 per cent in early trading Tuesday.
The quarterly loss was the largest ever for Freddie Mac which, like its larger government-sponsored competitor Fannie Mae and a number of large investment banks, has been slammed in recent months by rising defaults on home mortgages.
The mortgage financier said it is “seriously considering” cutting in half its dividend in the fourth quarter and has hired Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc. as financial advisers to help it examine possible new ways of raising capital in the near future.
Freddie Mac said it set aside $1.2-billion in the turbulent July-September period to account for bad home loans, reflecting “the significant deterioration of mortgage credit.”
Executives said Tuesday there was little to be optimistic about in the fourth quarter and told investors to brace for more of the same, sending shares on the greatest one-day plunge since public trading began for Freddie nearly two decades ago.
Losses widened from $715-million during the same period last year. The report sent shares tumbling $9.89 to $26.37 Tuesday.
The company posted negative revenue of $678-million, as it sustained losses under generally accepted accounting principles of $3.6-billion in the quarter. The revenue compared with positive revenue of $91-million a year earlier.
The $2-billion third-quarter loss for McLean, Va.-based Freddie Mac worked out to $3.29 a share, compared with $1.17 a share in the third quarter of 2006.
Losses far exceeded Wall Street analysts expectations of a 22 cent per-share loss, according to a poll by Thomson Financial.
The results for Freddie Mac, together with a recent report by Fannie Mae, heighten investor anxiety over the government-sponsored companies, which had been considered less vulnerable in the housing crisis because they have had less exposure to high-risk, subprime mortgages.
Freddie Mac's regulatory core capital was estimated to be just $600-million in excess of the 30 per cent mandatory target capital surplus directed by the Office of Federal Housing Enterprise Oversight.
If dividend cuts and other actions aren't sufficient to help the company reach its government-mandated level of capital held in reserve as a cushion against risk, Freddie Mac said it may consider other measures such as limiting its growth, reducing the size of its mortgage investment holdings or issuing new stock.
That could put additional strain on a housing market suffering the worst slump in more than 15 years.
Freddie Mac has traditionally funded the mortgage market when other banks pull back because of risk.
An inability by Freddie Mac to fill that role could hinder a return to equilibrium in the mortgage market and possibly intensify the housing downturn.
“Without doubt, 2007 has been an extremely difficult year for the country's housing and credit markets and, as our third-quarter financial results reflect, we have been impacted by the deterioration in these markets,” company Chairman and CEO Richard Syron said in a statement. “We recognized the challenges facing the mortgage markets, however, and have taken further steps to address them.”
So far this year, Freddie Mac has recognized $4.6-billion in pretax credit related items.
Buddy Piszel, chief financial officer, said Freddie Mac is moving to stem losses.
“We have begun raising prices, tightened our credit standards and enhanced our risk management practices,” Mr. Piszel said. “We also continue to improve our internal controls.”
“We were getting thin” in terms of excess capital, and Freddie Mac decided it needed to bolster its capital “to manage through this credit cycle,” Mr. Piszel said in a telephone interview. That cycle isn't expected to improve until 2009, he said, with home prices projected to register a 5 per cent to 6 per cent decline nationwide.
Moving To Houston After The Royalty Review?
From the November 20th edition of the Daily Oil Bulletin:
Monday, November 19, 2007
Another Shitty Biofuel Concept
Stupidest damned thing I've seen on late:
Quebec company aims to turn stinky diapers into cost effective diesel fuel
MONTREAL - If a Quebec company has its way, dirty diapers normally destined for landfills will soon be transformed into a cost-effective, synthetic diesel fuel.
It's not such a stretch, says engineering and project management company AMEC, which is working on behalf of an as yet unnamed client to build a facility in the Montreal area that would use a process known as pyrolysis to convert diapers to diesel.
The concept has been around for ages and is continually changing, said Luciano Piciacchia, an engineer and vice-president with Amec's Quebec office.
``But some of the issues that come up with (the process) is the consistency of the material you're putting through,'' he added.
Enter diapers, which are in plentiful supply in area hospitals and consistent in their composition. The company is considering a collection system to ensure it gets the volume it requires.
``If we try to take municipal waste and run it through a system like this, it would be too variable and you'd get all sorts of nasty surprises you'd have to deal with,'' Piciacchia said.
``One of the beauties of the diaper is that it is going to be a very consistent input.''
The initial plan is to convert about 30,000 tonnes of diapers, about one-quarter of the diapers that end up in landfills in Quebec yearly. Piciacchia says that number of diapers will translate into about 11,000 tonnes of diesel fuel. The preliminary economic analysis pegs the cost of the fuel at 50 cents per litre.
Pyrolysis, also known as thermal cracking, involves heating up the diapers up in a closed, controlled environment at temperatures of up to 600C without air, essentially breaking them down thermally.
``Then you're bringing it to the next level which is breaking the carbon chains down ... and (in the end) they will resemble the fuels which are what we're going to end up producing,'' Piciacchia said.
The so-called diaper diesel can be used in just about any industrial application, but probably won't be suitable for use in an automobile, Piciacchia said.
``The other beauty of it is because this whole thing works in a closed system, there are no emissions,'' he added.
David Bressler of the University of Alberta says pyrolysis is a ``very hot area of research right now'' as industry looks for ways to further develop biofuel production technology.
``There is a lot of good things about this class of technology, there aren't a lot of negatives,'' Bressler said. ``Right now, they're just figuring out how to make the process cost-efficient ... that's really the catch in the bio-industrial side.''
Piciacchia says there are plenty of companies looking at other potential feedstocks.
One of his company's clients is looking at car fluff - the non-metallic parts in a car - while another is looking at roof shingles as a potential source.
With fingers crossed, Piciacchia says a diaper diesel plant could be in operation in the Montreal area within the 18 months.
Bressler says the science is sound, but there will be some bumps along the way as they attempt to turn it into a profitable industry.
``You kind of have to hit the ground to get going and then once you're at that scale, you can go back and gain the efficiency you need to be long-term competitive,'' Bressler said.
Don Smith, a professor in the plant sciences department at McGill University, says with the process improving, diapers could certainly fly.
``Economically, you're turning a waste stream into a resource stream, and that works pretty well,'' Smith said. ``It could fly and it would be good if it did fly. There are a lot of these diapers going to landfills and it would just be great if we could convert these into something useful.''
Long-Term Oil Gloom Spreads In Houston
Energy Angst: Long-Term Oil Gloom Spreads In Houston
HOUSTON – Saudi Arabia has more oil, Amsterdam more tankers, New York more money, but Houston has the heart of the global oil industry. These days, it is not beating well. Study after study, executive after executive, and analyst after analyst is warning that there are rough times ahead for oil supply.
Here, oil news is analyzed, sorted and shelved. But in 37 years of writing about energy, in boom and bust, I have never found the kind of fatalism that now grips the oil patch.
Click on link above for whole article, well worth reading.
Sunday, November 18, 2007
Just When You Thought You Were Safe
Damn. Just when I thought I was safe. I had it all figured out. I thought if I stayed out of the Vancouver airport the chances of me getting a 50,000 Volt electric chair sans chair was minimal. And then I saw this piece of unpleasant news:
Canadian police commissioner says airport officers reassigned after Taser death
Yeah, the stupid buggers could be anywhere now. Would have been better to leave them in place, at least then we knew where they were. But no, they had to reassign them. You could now be "hit" by a mad zapper from St John's to the Queen Charlotte Islands.
A good link on the whole issue, including the video tape which proves the initial RCMP statements of the incident were lies, is here:
http://www.cbc.ca/canada/british-columbia/story/2007/11/14/bc-taservideo.html
Subsequent to the video coming out I heard the interview below with the RCMP on "As It Happens". The officer interviewed gave one of the worst interviews I've ever heard; absolutely blew it. They've got a lot of explaining to do. If anyone else did what they just did they'd be in jail for many, many years. Or in the case of Texas, executed.
Canadian police commissioner says airport officers reassigned after Taser death
Yeah, the stupid buggers could be anywhere now. Would have been better to leave them in place, at least then we knew where they were. But no, they had to reassign them. You could now be "hit" by a mad zapper from St John's to the Queen Charlotte Islands.
A good link on the whole issue, including the video tape which proves the initial RCMP statements of the incident were lies, is here:
http://www.cbc.ca/canada/british-columbia/story/2007/11/14/bc-taservideo.html
Subsequent to the video coming out I heard the interview below with the RCMP on "As It Happens". The officer interviewed gave one of the worst interviews I've ever heard; absolutely blew it. They've got a lot of explaining to do. If anyone else did what they just did they'd be in jail for many, many years. Or in the case of Texas, executed.
2007-11-15 As It Happens Daily
Accountability. The R.C.M.P. and Vancouver's Airport Authority react to the release of a video showing a man being lethally Tasered by police.
Right click to Download 2007-11-15 As It Happens Daily
[mp3 file: runs 19:42]
Greater Than 50 Percent Probability?
According to Gregory Peters, head of credit strategy at Morgan Stanley:
Click on the link below for much more:
Holy alarming prognosis, batman...........
There's a greater than 50 percent probability that the financial system will come to a grinding halt. You have the SIVs, you have the conduits, you have the money-market funds, you have future losses still in the dealer's balance sheet in the banks [..]
Click on the link below for much more:
Holy alarming prognosis, batman...........
Oops............ OPEC
Saturday, November 17, 2007
OPEC blunder reveals debate on weak dollar
RIYADH, Saudi Arabia — The accidental airing of a closed OPEC session Friday provided a surprise glimpse into a sensitive debate over the weakening U.S. dollar, with Saudi Arabia's foreign minister warning that even talking publicly about the currency's decline could further hurt its value.
The high-profile blunder ahead of a rare OPEC summit revealed the debate as Iran attempted to convince other member countries to express concern over dollar depreciation in the meeting's final declaration.
Oil is priced in dollars on the world market, and its depreciation has concerned oil producers because it has contributed to rising crude prices and has eroded the value of their dollar reserves. Cartel officials have resisted pressure to increase oil production to ease prices.
"The reality is that we have this problem. I think we should draft the declaration to reflect our concerns," Iranian Foreign Minister Manouchehr Mottaki said during a pre-summit meeting here with fellow ministers from the Organization of Petroleum Exporting Countries.
But Saud al-Faisal, foreign minister of U.S. ally Saudi Arabia, came out against the proposal with unusually frank comments.
"In my feeling, the mere mention that the OPEC countries are studying the issue of the dollar is itself going to have an impact that endangers the interests of the countries," he said.
"We all should be worried if any action that we take will lead us to do some injury to our returns on our product," al-Faisal said. "Nobody wants to have less money than more money. I am sure that we all agree on that."
Broadcast accidental
The closed meeting was accidentally broadcast to journalists and after about 40 minutes, an official rushed into the press room and yanked the television cable out of the wall.
A public declaration by OPEC expressing concern about the falling value of the dollar could send the currency even lower, putting at risk the vast dollar holdings oil producers have generated as crude prices have soared to record levels.
Iran and Venezuela have proposed trading oil in a basket of currencies to replace the historic link to the dollar, but they have been unable to generate enough support from fellow OPEC members.
After the meeting, OPEC Secretary General Abdalla Salem el-Badri said the group had decided not to mention concern over dollar depreciation in the declaration.
"We discussed it among ourselves, but I will tell you, you will not see it in the final declaration," he said. "I told you ... many times that we are concerned, but this is a member-country policy."
Saudi Foreign Minister al-Faisal suggested during the meeting that OPEC analyze the impact of dollar depreciation without documenting its efforts or concern.
"This is not new. We have done this in the past, decide to study something without putting down on paper that we are going to study it so that we avoid any implication that will bring adverse effect to our countries' finances," al-Faisal said.
Not everyone agreed with the Saudi foreign minister in the meeting. Nigerian Finance Minister Shamsuddeen Usman suggested accommodating Iran's proposed addition.
"While underlining our concern for the continued depreciation of the dollar and its adverse impact on our revenues, we instruct our finance ministers to study the issue exhaustively and advise us on ways to safeguard the purchasing power of our revenues, of our members' revenues," Usman suggested the statement should read.
Production speculation
Although the issue of dollar depreciation took center stage on the eve of the upcoming summit, which starts today, the run-up to the meeting was also dominated by speculation over whether OPEC would raise production after recent oil-price increases that have closed in on $100.
The record oil prices prompted U.S. Energy Secretary Samuel Bodman to call on OPEC to increase production earlier this week, but cartel officials have said they will hold off any decision until the group meets next month in Abu Dhabi, United Arab Emirates.
OPEC blunder reveals debate on weak dollar
RIYADH, Saudi Arabia — The accidental airing of a closed OPEC session Friday provided a surprise glimpse into a sensitive debate over the weakening U.S. dollar, with Saudi Arabia's foreign minister warning that even talking publicly about the currency's decline could further hurt its value.
The high-profile blunder ahead of a rare OPEC summit revealed the debate as Iran attempted to convince other member countries to express concern over dollar depreciation in the meeting's final declaration.
Oil is priced in dollars on the world market, and its depreciation has concerned oil producers because it has contributed to rising crude prices and has eroded the value of their dollar reserves. Cartel officials have resisted pressure to increase oil production to ease prices.
"The reality is that we have this problem. I think we should draft the declaration to reflect our concerns," Iranian Foreign Minister Manouchehr Mottaki said during a pre-summit meeting here with fellow ministers from the Organization of Petroleum Exporting Countries.
But Saud al-Faisal, foreign minister of U.S. ally Saudi Arabia, came out against the proposal with unusually frank comments.
"In my feeling, the mere mention that the OPEC countries are studying the issue of the dollar is itself going to have an impact that endangers the interests of the countries," he said.
"We all should be worried if any action that we take will lead us to do some injury to our returns on our product," al-Faisal said. "Nobody wants to have less money than more money. I am sure that we all agree on that."
Broadcast accidental
The closed meeting was accidentally broadcast to journalists and after about 40 minutes, an official rushed into the press room and yanked the television cable out of the wall.
A public declaration by OPEC expressing concern about the falling value of the dollar could send the currency even lower, putting at risk the vast dollar holdings oil producers have generated as crude prices have soared to record levels.
Iran and Venezuela have proposed trading oil in a basket of currencies to replace the historic link to the dollar, but they have been unable to generate enough support from fellow OPEC members.
After the meeting, OPEC Secretary General Abdalla Salem el-Badri said the group had decided not to mention concern over dollar depreciation in the declaration.
"We discussed it among ourselves, but I will tell you, you will not see it in the final declaration," he said. "I told you ... many times that we are concerned, but this is a member-country policy."
Saudi Foreign Minister al-Faisal suggested during the meeting that OPEC analyze the impact of dollar depreciation without documenting its efforts or concern.
"This is not new. We have done this in the past, decide to study something without putting down on paper that we are going to study it so that we avoid any implication that will bring adverse effect to our countries' finances," al-Faisal said.
Not everyone agreed with the Saudi foreign minister in the meeting. Nigerian Finance Minister Shamsuddeen Usman suggested accommodating Iran's proposed addition.
"While underlining our concern for the continued depreciation of the dollar and its adverse impact on our revenues, we instruct our finance ministers to study the issue exhaustively and advise us on ways to safeguard the purchasing power of our revenues, of our members' revenues," Usman suggested the statement should read.
Production speculation
Although the issue of dollar depreciation took center stage on the eve of the upcoming summit, which starts today, the run-up to the meeting was also dominated by speculation over whether OPEC would raise production after recent oil-price increases that have closed in on $100.
The record oil prices prompted U.S. Energy Secretary Samuel Bodman to call on OPEC to increase production earlier this week, but cartel officials have said they will hold off any decision until the group meets next month in Abu Dhabi, United Arab Emirates.
Saturday, November 17, 2007
The Tories don't seem to believe in agreements. Witness how it has treated the petroleum industry, the biggest employer and industry in the province.
I guess Stelmach must figure if he isn't bound to an agreement, why should anyone else be?
The ATA and the province agreed to split $6.1 billion dollars of unfunded pension liabilities; the province was generous and agreed to pay two thirds the cost while the ATA agreed to pay one third the cost, which was $2.1 billion.
To head off a potential teacher's strike that may interfere with the upcoming election, the Stelmach government generously absorbed the ATA's 1/3 of the unfunded pension liability. This was a $2.1 BILLION dollar give away by the province. At the stroke of a pen, Stelmach reallocated $600 from each Albertan to 30,000 teachers.
All to buy the teachers off from striking for five years.
For every teacher, this is the equivalent to $15,000 per year for five years; or a one time bonus of $90,000. It also results in an instant gross increase in pay of 3.1%; which will probably be a net increase of about 5%.
I agree that teachers strikes should be illegal. Many parents depend on being able to take their children to school to be able to work. If the school is shut down due to a strike, the people can't work. I think it should be easy to define teachers as an essential service which isn't allowed to strike.
Actually, I think any public service strike should be illegal. The private sector can have strikes because presumably the only affected parties are the workers and owners of the company affected. Public sector strikes affect everyone in the public, not just the employer and employees so in my view should be banned.
I guess Stelmach must figure if he isn't bound to an agreement, why should anyone else be?
The ATA and the province agreed to split $6.1 billion dollars of unfunded pension liabilities; the province was generous and agreed to pay two thirds the cost while the ATA agreed to pay one third the cost, which was $2.1 billion.
To head off a potential teacher's strike that may interfere with the upcoming election, the Stelmach government generously absorbed the ATA's 1/3 of the unfunded pension liability. This was a $2.1 BILLION dollar give away by the province. At the stroke of a pen, Stelmach reallocated $600 from each Albertan to 30,000 teachers.
All to buy the teachers off from striking for five years.
For every teacher, this is the equivalent to $15,000 per year for five years; or a one time bonus of $90,000. It also results in an instant gross increase in pay of 3.1%; which will probably be a net increase of about 5%.
I agree that teachers strikes should be illegal. Many parents depend on being able to take their children to school to be able to work. If the school is shut down due to a strike, the people can't work. I think it should be easy to define teachers as an essential service which isn't allowed to strike.
Actually, I think any public service strike should be illegal. The private sector can have strikes because presumably the only affected parties are the workers and owners of the company affected. Public sector strikes affect everyone in the public, not just the employer and employees so in my view should be banned.
Teachers reach pension deal with province
Jason Fekete, Calgary Herald
Published: Friday, November 16, 2007
Premier Ed Stelmach bulldozed through potentially his largest political barrier to electoral success on Thursday, announcing a multibillion-dollar deal to cover the teachers' unfunded pension liability in exchange for five years of labour peace.
Spending watchdogs, however, assailed the government for "selling out Albertans," while opposition parties said the deal was struck for political expediency, not because it's the right thing to do for nearly 30,000 teachers who could go on strike.
The tentative deal between the province and the Alberta Teachers' Association will see the government swallow the teachers' $2.1-billion portion of the unfunded pension liability up to 1992, on top of the $4.3 billion owed by the province -- for a total of $6.4 billion.
But the agreement is contingent upon all 62 publicly elected school boards and local teachers' bargaining units ratifying the deal by the end of January. If they don't, nearly 30,000 teachers from 54 boards could be on strike in the new year -- possibly in the midst of an expected spring election campaign.
"The challenge now is one of time," Stelmach said in Edmonton, insisting the agreement balances the needs of teachers, students and taxpayers. "It's just a huge -- not necessarily a burden -- but off the shoulders" for teachers, his government and all Albertans, the premier added.
Indeed, the government might be breathing the biggest sigh of relief.
An agreement with teachers would prevent a province wide strike in early 2008 that could cripple the Tory government in an election campaign, argued David Taras, political analyst at the University of Calgary.
"It's very convenient for the government. It's the preemptive strike," Taras said. "It's part of clearing the decks and making sure there's labour peace, so it doesn't become an issue during the election."
The unfunded pension liability has been a thorn in the side of Tory governments for years. The former Klein government failed in repeated attempts to strike a deal.
Since it was created in the 1930s, the teachers' pension fund has been underfunded by both the government and the ATA. The liability currently totals $7.1 billion, including $6.4 billion up to 1992 -- when both sides agreed to increase their contributions -- as well as $700 million since then.
Currently, 3.1 per cent of every teacher's salary is deducted to cover the pension liability, including new teachers who weren't working when the deficit was generated. The new deal would allow teachers to keep the cash that's being allocated to cover the unfunded liability.
"I'm quite confident this will be greeted warmly by the teachers," said ATA President Frank Bruseker. "This is a real positive move . . . What this will mean is labour peace in the education sector."
If school boards and teachers' ratify the deal, it will eliminate any possibility of strikes or lockouts until September 2012.
Stelmach said the deal is critical because the current funding structure of the pre-1992 liability could have cost both sides upward of $45 billion to eliminate it over the next 52 years.
While his government has committed billions in cash, the premier said he's not sure where all the money will come from and how quickly the province will burn the pension liability.
"We're going to be working through a number of scenarios," Stelmach said, noting a pact with teachers has been a priority since he first took office.
But the deal was immediately assailed by the Canadian Taxpayers Federation. The group suggested covering the $2.1-billion teachers' portion will cost $600 per Albertan and simply amounts to a "payoff" designed to keep the Tories in office.
The government could have achieved labour peace and saved billions in the process by simply banning teachers' strikes, said Scott Hennig, Alberta director of the taxpayers federation.
"Stelmach sold out taxpayers on this for political expediency," Hennig charged. "This is not a move to help teachers or students. This is a move to help the Stelmach government avoid a teachers' strike during a provincial election."
Opposition parties welcomed the deal but accused the Tory government of only agreeing to it now because a provincewide teachers' strike in the new year could sideswipe them on the campaign trail. "This very clearly takes us one step closer to an election," chimed Liberal finance critic Rick Miller.
But even Miller recognized the agreement is politically savvy on the government's part and steals ammunition from the Grits and other parties.
"Our policy platform just got a page shorter," he said.
NDP Leader Brian Mason said the proposed agreement looks positive, but insisted it took a looming provincial election campaign to force the government to do the right thing.
"The government is prepared to spend a considerable amount of money in order to solve a major political problem," Mason said.
Alberta Alliance Leader Paul Hinman said he's worried about the final price tag and what it could do to provincial coffers.
"It's a good day for the teachers. It sounds like a good day for the government," Hinman said. "But is it a good day for the taxpayers?"
jfekete@theherald.canwest.com
Friday, November 16, 2007
Brad Peak Lets Premier Ed In On Research in the Real World
This letter was written in response to this note, previously posted.
Stelmach - Response Letter from GP
Many times when i get an email like this i just sit back and read it, and wonder just who really wrote it and what was their motivation for doing so. Being the little knowledge freak I am, I decided to do some investigating of my own, in the back yard of GP and area based on the content of the letter. Many of you know I have a Small Oil and Gas company of my own (150 BOE/D) and try to stay in tune with the political issues that affect me based on my current size of production and costs. I also like to stay in tune with larger players and the way changes affect them so that I may look forward and plan my continually evolving business model.
I contacted via telephone a senior member of CNRL's team in that area. We used to work together in Rainbow Lake for many years and have both went on in separate directions to become strong friends and strong business people, excellent technical people (both hands on mechanical/instrumentation and paperwork and people skills). I guess thats why we are friends, we think the same ways, and face many of the same challenges. We talked personal for awhile, then things let to the royalty review, actual operations and current projects, and the impacts we expect to see from each our perspectives. I mentioned this letter. He asked me is that the one from the rental guy in GP. Yes it is I respond. Yes I know that guy he says. So we discuss what's in the letter about the canceled projects, I am wondering if these rigs actually folded up and went home or not. I got the answer.
I've never actually seen this, rig moves are not cheap at all, but sometimes cutting a loss is the best outcome you could foresee. He said yes we did cancel those wells. One of the rigs we talked about was just in the process of setting up for spacing and prep'ing to stand for drilling, and the word came down to rack it all up and send it back to yard. So yes this is a true case story, not just some letter from a disgruntled taxpayer who needs to go on a holiday and chill out for awhile.
I asked what was it that lead to that choice to rig out before you're finished rigging in. That must have been a hard decision to make I responded with. He said it was not what they wanted to do, what they wanted to do was to drill the wells. But when you are embarking on a D&C (drill and complete) project that will run between $5,000,000.00 and $20,000,000.00 and the rules change in the middle of the game, you sometimes have to modify your game plan. With a D&C cost like that, and with a risk of capital of that magnitude (of which the citizens of the Province of Alberta do not participate in), where the original rule book gave a royalty exemption until payout to recover capital costs of that size, the risk was slightly offset and a projected ROI would be 3 to 5 years if the project did not go bust completely, but there is still risk attached. He indicated that now this royalty exemption is gone and the risk remains the same, the anticipated ROI is now forecast to be 8 years. And thats IF what the target is, gives it to you, to move you toward any ROI at all.
I'm starting to see it now. The citizens that had Ed demand their "fair share" were never sharing in the risk before, and now even more so. So I can see why one would elect to not drill a well, even when the rig is in the process of setting up. Now there is no well. The risk of capital has been removed. There is no asset to apply any royalty to, even if it would have been 3 years down the road. Now there is nothing to apply any royalty to. When ill-informed people send regulators to send you a message that sums up like this:
- You take all the risks
- You pay all the costs
- We want our share first
- We will not share in any risk though, you will assume all risks yourself
- If you go bust thats too bad
- If you find production we want our "share" first
- We don't care what your ROI is or if there is one at all.
THAT......kills industry and all the people it would have employed just to drill these wells, not including tie ins, pipelines, facilities, operating, etc. It takes over 75 people to drill just one of these wells. Now there is no well. No taxation of corporate or personal income because there are no services provided for 14 of these wells at $5 - $20 million dollars a pop. No royalty revenue because there is no well. No decent land sale bonus to the crown for offset sections because no one will want to lease crown P&NG rights anymore, because its all different now.
To the citizens of the Province of Alberta who insist that they are overdue to get their fare share.......get ready for it, because here it comes. I don't care what the rate is, any rate times zero is = ZERO. Thats grade one math. To these citizens and the cronies who gave in to get greedy.....are either of you smarter than a fifth grader? I would say, No they can't be. But....I know one man who is...he saved his capital, he may soon need it to move to Saskatchewan, and I'm right in his footsteps. I actually started evaluating Saskatchewan yesterday, one day before receiving this letter.
This is just starting, we haven't even seen the ramifications of this yet. Its just getting started. That's too bad, it's gonna hurt a lot of people really bad in a somewhat geographical way. Rental company or completely otherwise.
You may forward or send this to whoever you want. It doesn't matter now, it's not a disgruntled letter, its just a true life example.
Brad Peake
Stelmach - Response Letter from GP
Many times when i get an email like this i just sit back and read it, and wonder just who really wrote it and what was their motivation for doing so. Being the little knowledge freak I am, I decided to do some investigating of my own, in the back yard of GP and area based on the content of the letter. Many of you know I have a Small Oil and Gas company of my own (150 BOE/D) and try to stay in tune with the political issues that affect me based on my current size of production and costs. I also like to stay in tune with larger players and the way changes affect them so that I may look forward and plan my continually evolving business model.
I contacted via telephone a senior member of CNRL's team in that area. We used to work together in Rainbow Lake for many years and have both went on in separate directions to become strong friends and strong business people, excellent technical people (both hands on mechanical/instrumentation and paperwork and people skills). I guess thats why we are friends, we think the same ways, and face many of the same challenges. We talked personal for awhile, then things let to the royalty review, actual operations and current projects, and the impacts we expect to see from each our perspectives. I mentioned this letter. He asked me is that the one from the rental guy in GP. Yes it is I respond. Yes I know that guy he says. So we discuss what's in the letter about the canceled projects, I am wondering if these rigs actually folded up and went home or not. I got the answer.
I've never actually seen this, rig moves are not cheap at all, but sometimes cutting a loss is the best outcome you could foresee. He said yes we did cancel those wells. One of the rigs we talked about was just in the process of setting up for spacing and prep'ing to stand for drilling, and the word came down to rack it all up and send it back to yard. So yes this is a true case story, not just some letter from a disgruntled taxpayer who needs to go on a holiday and chill out for awhile.
I asked what was it that lead to that choice to rig out before you're finished rigging in. That must have been a hard decision to make I responded with. He said it was not what they wanted to do, what they wanted to do was to drill the wells. But when you are embarking on a D&C (drill and complete) project that will run between $5,000,000.00 and $20,000,000.00 and the rules change in the middle of the game, you sometimes have to modify your game plan. With a D&C cost like that, and with a risk of capital of that magnitude (of which the citizens of the Province of Alberta do not participate in), where the original rule book gave a royalty exemption until payout to recover capital costs of that size, the risk was slightly offset and a projected ROI would be 3 to 5 years if the project did not go bust completely, but there is still risk attached. He indicated that now this royalty exemption is gone and the risk remains the same, the anticipated ROI is now forecast to be 8 years. And thats IF what the target is, gives it to you, to move you toward any ROI at all.
I'm starting to see it now. The citizens that had Ed demand their "fair share" were never sharing in the risk before, and now even more so. So I can see why one would elect to not drill a well, even when the rig is in the process of setting up. Now there is no well. The risk of capital has been removed. There is no asset to apply any royalty to, even if it would have been 3 years down the road. Now there is nothing to apply any royalty to. When ill-informed people send regulators to send you a message that sums up like this:
- You take all the risks
- You pay all the costs
- We want our share first
- We will not share in any risk though, you will assume all risks yourself
- If you go bust thats too bad
- If you find production we want our "share" first
- We don't care what your ROI is or if there is one at all.
THAT......kills industry and all the people it would have employed just to drill these wells, not including tie ins, pipelines, facilities, operating, etc. It takes over 75 people to drill just one of these wells. Now there is no well. No taxation of corporate or personal income because there are no services provided for 14 of these wells at $5 - $20 million dollars a pop. No royalty revenue because there is no well. No decent land sale bonus to the crown for offset sections because no one will want to lease crown P&NG rights anymore, because its all different now.
To the citizens of the Province of Alberta who insist that they are overdue to get their fare share.......get ready for it, because here it comes. I don't care what the rate is, any rate times zero is = ZERO. Thats grade one math. To these citizens and the cronies who gave in to get greedy.....are either of you smarter than a fifth grader? I would say, No they can't be. But....I know one man who is...he saved his capital, he may soon need it to move to Saskatchewan, and I'm right in his footsteps. I actually started evaluating Saskatchewan yesterday, one day before receiving this letter.
This is just starting, we haven't even seen the ramifications of this yet. Its just getting started. That's too bad, it's gonna hurt a lot of people really bad in a somewhat geographical way. Rental company or completely otherwise.
You may forward or send this to whoever you want. It doesn't matter now, it's not a disgruntled letter, its just a true life example.
Brad Peake
New Method to Make Hydrogen
New Method Converts Organic Matter To Hydrogen Fuel Easily And Efficiently
ScienceDaily (Nov. 13, 2007) — Hydrogen as an everyday, environmentally friendly fuel source may be closer than we think, according to Penn State researchers.
"The energy focus is currently on ethanol as a fuel, but economical ethanol from cellulose is 10 years down the road," says Bruce E. Logan, the Kappe professor of environmental engineering. "First you need to break cellulose down to sugars and then bacteria can convert them to ethanol."
Logan and Shaoan Cheng, research associate, suggest a method based on microbial fuel cells to convert cellulose and other biodegradable organic materials directly into hydrogen.
The researchers used naturally occurring bacteria in a microbial electrolysis cell with acetic acid -- the acid found in vinegar. Acetic acid is also the predominant acid produced by fermentation of glucose or cellulose. The anode was granulated graphite, the cathode was carbon with a platinum catalyst, and they used an off-the-shelf anion exchange membrane. The bacteria consume the acetic acid and release electrons and protons creating up to 0.3 volts. When more than 0.2 volts are added from an outside source, hydrogen gas bubbles up from the liquid.
"This process produces 288 percent more energy in hydrogen than the electrical energy that is added to the process," says Logan.
Water hydrolysis, a standard method for producing hydrogen, is only 50 to 70 percent efficient. Even if the microbial electrolysis cell process is set up to bleed off some of the hydrogen to produce the added energy boost needed to sustain hydrogen production, the process still creates 144 percent more available energy than the electrical energy used to produce it.
For those who think that a hydrogen economy is far in the future, Logan suggests that hydrogen produced from cellulose and other renewable organic materials could be blended with natural gas for use in natural gas vehicles.
"We drive a lot of vehicles on natural gas already. Natural gas is essentially methane," says Logan. "Methane burns fairly cleanly, but if we add hydrogen, it burns even more cleanly and works fine in existing natural gas combustion vehicles."
The range of efficiencies of hydrogen production based on electrical energy and energy in a variety of organic substances is between 63 and 82 percent. Both lactic acid and acetic acid achieve 82 percent, while unpretreated cellulose is 63 percent efficient. Glucose is 64 percent efficient.
Another potential use for microbial-electrolysis-cell produced hydrogen is in fertilizer manufacture. Currently fertilizer is produced in large factories and trucked to farms. With microbial electrolysis cells, very large farms or farm cooperatives could produce hydrogen from wood chips and then through a common process, use the nitrogen in the air to produce ammonia or nitric acid. Both of these are used directly as fertilizer or the ammonia could be used to make ammonium nitrate, sulfate or phosphate.
This research is published in the Nov. 12 issue of the Proceedings of the National Academy of Sciences online.
The researchers have filed for a patent on this work. Air Products and Chemicals, Inc. and the National Science Foundation supported this work.
ScienceDaily (Nov. 13, 2007) — Hydrogen as an everyday, environmentally friendly fuel source may be closer than we think, according to Penn State researchers.
"The energy focus is currently on ethanol as a fuel, but economical ethanol from cellulose is 10 years down the road," says Bruce E. Logan, the Kappe professor of environmental engineering. "First you need to break cellulose down to sugars and then bacteria can convert them to ethanol."
Logan and Shaoan Cheng, research associate, suggest a method based on microbial fuel cells to convert cellulose and other biodegradable organic materials directly into hydrogen.
The researchers used naturally occurring bacteria in a microbial electrolysis cell with acetic acid -- the acid found in vinegar. Acetic acid is also the predominant acid produced by fermentation of glucose or cellulose. The anode was granulated graphite, the cathode was carbon with a platinum catalyst, and they used an off-the-shelf anion exchange membrane. The bacteria consume the acetic acid and release electrons and protons creating up to 0.3 volts. When more than 0.2 volts are added from an outside source, hydrogen gas bubbles up from the liquid.
"This process produces 288 percent more energy in hydrogen than the electrical energy that is added to the process," says Logan.
Water hydrolysis, a standard method for producing hydrogen, is only 50 to 70 percent efficient. Even if the microbial electrolysis cell process is set up to bleed off some of the hydrogen to produce the added energy boost needed to sustain hydrogen production, the process still creates 144 percent more available energy than the electrical energy used to produce it.
For those who think that a hydrogen economy is far in the future, Logan suggests that hydrogen produced from cellulose and other renewable organic materials could be blended with natural gas for use in natural gas vehicles.
"We drive a lot of vehicles on natural gas already. Natural gas is essentially methane," says Logan. "Methane burns fairly cleanly, but if we add hydrogen, it burns even more cleanly and works fine in existing natural gas combustion vehicles."
The range of efficiencies of hydrogen production based on electrical energy and energy in a variety of organic substances is between 63 and 82 percent. Both lactic acid and acetic acid achieve 82 percent, while unpretreated cellulose is 63 percent efficient. Glucose is 64 percent efficient.
Another potential use for microbial-electrolysis-cell produced hydrogen is in fertilizer manufacture. Currently fertilizer is produced in large factories and trucked to farms. With microbial electrolysis cells, very large farms or farm cooperatives could produce hydrogen from wood chips and then through a common process, use the nitrogen in the air to produce ammonia or nitric acid. Both of these are used directly as fertilizer or the ammonia could be used to make ammonium nitrate, sulfate or phosphate.
This research is published in the Nov. 12 issue of the Proceedings of the National Academy of Sciences online.
The researchers have filed for a patent on this work. Air Products and Chemicals, Inc. and the National Science Foundation supported this work.
The Slowdown Begins
I was recently reading a typically uninformed article; they are still trickling into the mainstream media.
This quote caught my eye:
Well, looks like the slowdown is coming, apparently as the fool quoted in the article wanted. Signs of this? All over the place.
Bonnet's is selling its fracturing division. Understand that this new fracturing company had some of the best people in industry with it, brand new equipment, and was on its way to being a serious company. All built from scratch. Now all the equipment has been bought and it is heading to......... Russia. So much for the jobs in Alberta that existed, let alone the ones that would have been created.
This item too, which speaks for what is happening in GP.
I heard that Nexen has released 15 rigs on its long lake oilsands project. And CNRL released five rigs for its oilsands projects too.
I've heard a lot of equipment is moving south to the states, no quantification.
Producers too are moving to the states. How couldn't they be? A bit of business investigation indicates it is clearly a better place to be. It is no accident that Encana has been growing their business dramatically in the US over the last seven or eight years. Obviously barriers of entry for Canadian companies to go do it; clearly at least some companies are willing to step up and do it.
This quote caught my eye:
Of the controversy surrounding the royalty review, one argument is related to a slowdown in the economy due to a tightening up on the energy sector.
"As for the prospect of a slowdown in the Alberta economy because of higher royalty rates, that may well happen and that would not necessarily be a bad thing," said Hepburn. "In September the year-to-year rate of inflation in Alberta was 4.6 per cent, according to Statistics Canada, the national average was 2.5 per cent.
Well, looks like the slowdown is coming, apparently as the fool quoted in the article wanted. Signs of this? All over the place.
Bonnet's is selling its fracturing division. Understand that this new fracturing company had some of the best people in industry with it, brand new equipment, and was on its way to being a serious company. All built from scratch. Now all the equipment has been bought and it is heading to......... Russia. So much for the jobs in Alberta that existed, let alone the ones that would have been created.
This item too, which speaks for what is happening in GP.
I heard that Nexen has released 15 rigs on its long lake oilsands project. And CNRL released five rigs for its oilsands projects too.
I've heard a lot of equipment is moving south to the states, no quantification.
Producers too are moving to the states. How couldn't they be? A bit of business investigation indicates it is clearly a better place to be. It is no accident that Encana has been growing their business dramatically in the US over the last seven or eight years. Obviously barriers of entry for Canadian companies to go do it; clearly at least some companies are willing to step up and do it.
Baytex Energy Trust Announces Opening of Denver Office and Executive Appointments
CALGARY, ALBERTA--(Marketwire - Nov. 12, 2007) - Baytex Energy Trust (TSX:BTE.UN) (NYSE:BTE) is pleased to announce that we have established an office in Denver, Colorado to conduct oil and gas exploration and development activities in the United States.
Biofuels Facing Crash
Here is where our brave provincial PC leaders are taking us:
Biofuels bonanza facing 'crash'
By Roger Harrabin
Environment Analyst, BBC News, Valencia
Mr Steiner warns that Indonesia palm oil may never be sustainable
The biofuels bonanza will crash unless producers can guarantee their crops have been produced responsibly, the UN's environment agency chief has said.
Achim Steiner of the UN Environment Programme (Unep) said there was an urgent need for standards to make sure rainforests weren't being destroyed.
Biofuel makers also had to show their products did not produce more CO2 than they negated, he told BBC News.
Critics say biofuels will lead to food shortages and destroy rainforests.
They point to the destruction of Indonesia's peat swamps as an example of biofuel folly.
The swamps are one the richest stores of carbon on the planet and they are being burned to produce palm oil.
Mr Steiner implied that because of Indonesia's inability to police its land use, biofuels from palm oil grown by the nation might never be deemed to be sustainable.
But he said some biofuels could be considered sustainable. He highlighted ethanol production in Brazil, and a dry land crop called jatropha, which is resistant to pests and droughts.
Mr Steiner urged investors not to turn their backs on developing second or third generation fuels that would use non-food crops and burnable waste.
He feared that beneficial biofuels might be lost as part of a consumer backlash.
Mr Steiner made his comments in response to criticism from a group of independent scientists who said they had written to the Intergovernmental Panel on Climate Change (IPCC) complaining that the climate body's comments on biofuels have been naive.
The independent scientists pointed to two phrases in reports by the IPPC, of which Unep is a co-sponsor, which the scientists said could not be substantiated.
One stated that biofuels were an effective solution in at least a number of countries, while the other suggested that biofuels in the transport sector would generally have positive social and environmental benefits.
False economy
One of the scientists, Tad Patzek from University of California Berkeley, US, said: "In the long-run, the planet cannot afford to produce biofuels because we're going to run out of the land and water and environmental resources.
"In addition, because of the land use changes, drying up peat-swamps, burning tropical forest, these biofuels involve up-front enormous emissions of greenhouse gases that will never be recouped by their later use," he told BBC News.
Professor Patzek also doubted Mr Steiner's confidence in Brazilian ethanol. "The [IPCC] description of Brazilian sugar-cane ethanol production as 'highly advanced' and 'a model' is somewhat of an exaggeration.
"It's neither good nor a model," he said.
Brazilian producers are adamant that their bio-crops are not grown on rainforest land - but the environmental group Friends of the Earth Brazil claim that peasant farmers - dispossessed by biofuel conglomerates - are moving to the Amazon to seek new land.
Biofuels: next generation
Mr Steiner said Brazil had enough land to ensure that biofuel cropping could be sustainable.
The group of scientists said their letter to the head of the IPCC, Professor Pachauri, had not been answered.
BBC News has not been able to obtain a comment from Professor Pachauri, though this may be hardly surprising given that the final summit on the IPCC Fourth Assessment Report (A4R) is currently underway in Valencia, Spain.
Mr Steiner said Unep had set up a high-level task force to study the life-cycle implications of all biofuels. The group is expected to publish its findings next year.
By then much of the Indonesian peat swamps - one of the most valuable stores of carbon in the world - will have been torched.
The only way of stopping may not be through the UN or the Indonesian government, but through one or more private philanthropist with a burning desire to own an Indonesian swamp.
Biofuels bonanza facing 'crash'
By Roger Harrabin
Environment Analyst, BBC News, Valencia
Mr Steiner warns that Indonesia palm oil may never be sustainable
The biofuels bonanza will crash unless producers can guarantee their crops have been produced responsibly, the UN's environment agency chief has said.
Achim Steiner of the UN Environment Programme (Unep) said there was an urgent need for standards to make sure rainforests weren't being destroyed.
Biofuel makers also had to show their products did not produce more CO2 than they negated, he told BBC News.
Critics say biofuels will lead to food shortages and destroy rainforests.
They point to the destruction of Indonesia's peat swamps as an example of biofuel folly.
The swamps are one the richest stores of carbon on the planet and they are being burned to produce palm oil.
Mr Steiner implied that because of Indonesia's inability to police its land use, biofuels from palm oil grown by the nation might never be deemed to be sustainable.
But he said some biofuels could be considered sustainable. He highlighted ethanol production in Brazil, and a dry land crop called jatropha, which is resistant to pests and droughts.
Mr Steiner urged investors not to turn their backs on developing second or third generation fuels that would use non-food crops and burnable waste.
He feared that beneficial biofuels might be lost as part of a consumer backlash.
Mr Steiner made his comments in response to criticism from a group of independent scientists who said they had written to the Intergovernmental Panel on Climate Change (IPCC) complaining that the climate body's comments on biofuels have been naive.
The independent scientists pointed to two phrases in reports by the IPPC, of which Unep is a co-sponsor, which the scientists said could not be substantiated.
One stated that biofuels were an effective solution in at least a number of countries, while the other suggested that biofuels in the transport sector would generally have positive social and environmental benefits.
False economy
One of the scientists, Tad Patzek from University of California Berkeley, US, said: "In the long-run, the planet cannot afford to produce biofuels because we're going to run out of the land and water and environmental resources.
"In addition, because of the land use changes, drying up peat-swamps, burning tropical forest, these biofuels involve up-front enormous emissions of greenhouse gases that will never be recouped by their later use," he told BBC News.
Professor Patzek also doubted Mr Steiner's confidence in Brazilian ethanol. "The [IPCC] description of Brazilian sugar-cane ethanol production as 'highly advanced' and 'a model' is somewhat of an exaggeration.
"It's neither good nor a model," he said.
Brazilian producers are adamant that their bio-crops are not grown on rainforest land - but the environmental group Friends of the Earth Brazil claim that peasant farmers - dispossessed by biofuel conglomerates - are moving to the Amazon to seek new land.
Biofuels: next generation
Mr Steiner said Brazil had enough land to ensure that biofuel cropping could be sustainable.
The group of scientists said their letter to the head of the IPCC, Professor Pachauri, had not been answered.
BBC News has not been able to obtain a comment from Professor Pachauri, though this may be hardly surprising given that the final summit on the IPCC Fourth Assessment Report (A4R) is currently underway in Valencia, Spain.
Mr Steiner said Unep had set up a high-level task force to study the life-cycle implications of all biofuels. The group is expected to publish its findings next year.
By then much of the Indonesian peat swamps - one of the most valuable stores of carbon in the world - will have been torched.
The only way of stopping may not be through the UN or the Indonesian government, but through one or more private philanthropist with a burning desire to own an Indonesian swamp.
Sunday, November 4, 2007
Manning Emerges
All that it will take to throw out the PC's and put a new ruling party into Alberta is for some leader of note to step forward and gather the angry voters under an umbrella. This might be happening before our eyes:
Video
Text report
Video
Text report
Manning hammers Alberta's energy royalty plan
Updated Sun. Nov. 4 2007 3:16 PM ET
CTV.ca News Staff
Reform Party founder Preston Manning has slammed the Alberta government's new energy royalty plan and questioned Premier Ed Stelmach's competence.
During an appearance on CTV's Question Period, Manning urged Alberta's government to address "big-picture issues." The new plan creates uncertainty for energy consumers, producers and environmentalists, he said.
"I don't think you can talk about royalty policy without talking about tax policy, continental energy security and environment or vice versa," Manning said Sunday.
As Alberta emerges as one of the world's significant energy producers, Manning said Stelmach has yet to demonstrate his capacity to lead on major energy issues.
"I think the big question with Premier Stelmach and the administration is one of its competence. Does it have competence to deal with these big-picture issues?" Manning asked.
"Alberta is a big player, not just in the energy picture, but in the continental picture."
The new royalty plan is set to take effect on Jan. 1, 2009 and will collect $1.4 billion more in royalties by 2010 than the current system.
Under current calculations, royalties from the energy sector will put about $10.5 billion into Alberta coffers representing about one third of the provincial government's total annual revenues.
The Stelmach government modified some of the recommendations and rejected others made by the province's Alberta Royalty Review Panel. The panel had recommended an increase of about $2 billion annually in it's September report.
"(The government is) creating uncertainty because there will have to be an election before these things come into power," Manning said.
"The big picture just hasn't been spelled out, that's where I see the problems."
The new royalty plan effectively nullifies contracts with two of Alberta's largest oilsands players, creating uncertainty for investors and employees. Stelmach said he wants those negotiations wrapped up within the next 90 days, prompting criticism that his timeline is unrealistic.
The provincial government has yet to determine how the new royalty plan will directly affect energy-sector employment or the quality of life for the average Albertan.
Manning added it's becoming increasingly unlikely that Stelmach and the Conservatives will win another election unless the "government demonstrates a capacity it hasn't shown thus far."
"I don't see votes going to the Liberals or the NDP, I think their biggest danger is another 150,000 people staying home who voted Conservative the last time," he said.
Stelmach defended the plan shortly after it was announced on Oct. 25, saying knee-jerk negative reactions will dissipate as details of the plan are cemented.
"Change is never comfortable," he said during a speech to Conservative delegates last month. "We need a bigger pie to create new jobs, new opportunities and to build for the future.
"As future generations look back on this decision, I'm confident they'll see we were fair and reasonable. Not greedy and short-sighted."
Stelmach maintains the royalty revisions will provide Albertans with the "fair share Albertans rightly expect from the development of their resources."
Subscribe to:
Posts (Atom)