Pages

Monday, January 16, 2012

Wikipedia Blackout on Wednesday -- Absolutely Nothing To Do With The Bakken

Wikipedia will be blacked out for 24 hours in protest of US legislation pending:
Today, the Wikipedia community announced its decision to black out the English-language Wikipedia for 24 hours, worldwide, beginning at 05:00 UTC on Wednesday, January 18.

The blackout is a protest against proposed legislation in the United States —the Stop Online Piracy Act (SOPA) in the U.S. House of Representatives, and the PROTECTIP Act (PIPA) in the U.S. Senate— that, if passed, would seriously damage the free and open Internet, including Wikipedia.

This will be the first time the English Wikipedia has ever staged a public protest of this nature, and it’s a decision that wasn’t lightly made. Here’s how it’s been described by the three Wikipedia administrators who formally facilitated the community’s discussion.
I believe EST is five hours behind UTC ---- so 5:00 UTC is midnight here on the east coast, if I have my reasoning right. Midnight, Tuesday going into Wednesday and then 24 hours total.

My hunch is it won't be a complete blackout. My hunch is that the Wikipedia site will explain what is going on.

Manufacturers Coming Back to The States

Updates

For those following the price of oil, all things being equal, the strength of the dollar is probably the main reason for daily fluctuations in the price of oil. When there are no other obvious explanations for rise or fall in the price of oil, I generally look at the strength or weakness of the dollar to help find an explanation. I have to thank Don for pointing that out to me some years ago. In fact, I think it was the firt "lesson" Don taught me; he has taught me many, many lessons about oil

Since then, I have followed the strength/weakness of the dollar with some interest, although I really don't understand much about it.

I was stationed in Europe in the early 1980's when the dollar was so strong, we were living very, very inexpensively. I remember taking our family of four skiing in the Austrian Alps for a week, which, might now cover the cost of one day of skiing. It was awesome.

Years later, I returned to England, where it was incredibly expensive to live because of the exchange rate. In fact, things were so bad, military folks were playing the exchange rate on daily basis to a) make ends meet; and/or b) make a small profit.

So, it was of some interest to see someone suggest that it was the weak dollar and not energy that was part of the reason some manufacturers were coming back to the states (see first comment below).  In fact, "anonymous" said that the price of energy had "no direct correlation." None. Nil. Zilch. 

It should be noted that CEOs and the Boards of Fortune 500 companies are strategic in their outlook, looking down the road 20 years (if they hope to succeed; of course, some companies like Kodak are looking on a daily basis if they are still surviving).

Bringing manufacturing back to the states is a 20-year decision, not something taken lightly. My tea leaves suggest the dollar will strengthen in the near term vis a vis the Euro (which is about to implode), and energy will be the game changer in the long term (if "we" don't screw it up, which is always possible).

With that in mind, I offer some links to essays on the current and future strength of the dollar:
That Financial Times is particularly noteworthy; the lede:
US companies are beginning to feel the pinch of steady gains in the dollar as currency losses show up in fourth-quarter earnings and guidance reports, threatening a strong start to 2012 on Wall Street.
 
Most major currencies fell against the haven asset of the dollar in 2011 and the declines have continued this year. That could be bad news for S&P 500 companies as diverse as McDonald’ s and General Electric, which derived the majority of their 2010 revenue from foreign sales.

As the debt crisis in Europe worsened, global investors favoured the perceived safety of the US dollar. The euro slid about 14 per cent after hitting a high in May and last week touched 16-month low below $1.27.

Original Post
I don't have the link but I understand that some companies are bringing some of their manufacturing back to the states, and several reasons have been given. I wonder if cheap energy, political stability, and quality of the American workforce are the reasons?

The third reason is a bias that is difficult to prove: I strongly "believe" in the quality of the American workforce -- but it is a quality that cannot be easily measured or compared.*

The second reason -- political stability -- goes without saying for much of the world, which is not new, but instability may be spreading: this time to Europe due to the implosion of the euro. I doubt GE is looking to Greece, Portugal, Ireland, or Italy as places to build new manufacturing plants.

But who would have thought cheap energy would be part of the triad? But there it is. From USA TodayCarpeDiem.com via :
For companies that make plastics, fertilizer and other chemicals derived from natural gas, falling prices are a windfall. The same goes for makers of products from steel to bricks to beer. All use a lot of natural gas to heat their furnaces. U.S. manufacturers are becoming more competitive globally as a result of the country's cheap natural gas, industry officials say."
Who would have thought it -- that America is seeing cheap energy once again?
If the weather stays mild, the price [of natural gas] could even dip below $2, a level not seen since 2002.
Since 2002 -- ten years ago.

Let's hope "we" don't screw it up.

********************

*Part of the reason for the quality of the American workforce is due to education. [There is a lot of talk about the need for increased spending for American education but I argue that most of the workforce is over-educated/wrongly-educated, but that's a topic for another day.]  Other reasons for the quality of the workforce have to do with the entrepreneurial spirit; the "I have a dream" culture; inculcated capitalism of our youth; the rule of law; and, $200-smart phones. The five dots can be connected.

Timing Is Everything -- The Mideast -- Nothing To Do With The Bakken

Earlier this evening, perhaps an hour ago, I updated this old posting, with recent events putting an Islamist in charge of Egypt's parliament. I concluded the post by saying that it will be interesting to see what Egypt looks like in 18 months.

Now, just an hour later, I see the headline story in the LA Times. Maybe we are seeing some foreshadowing.

Go the new link to get the visual of what Egypt looks like now. 
Worry over fuel supplies has gripped the country for more than a week. Many gas stations have been forced to shut down or remain open for only a few hours. The government said premium and regular-grade gasoline is available but that drivers are hoarding over speculation that prices will rise.

Minister of Petroleum Abdullah Ghorab told local media that more than 15,000 tons of gasoline is provided to gas stations each day, 2,000 tons more than the usual daily consumption. He said the government has no intention of raising the price of fuel, which is subsidized, and urged consumers not to panic.

But gas station managers say supplies have been cut.
A picture is worth a thousand words, they say.

Ted Nugent on BP and the Gulf Oil Spill

Link here.
Not so long ago, BP was the goat of big business in the eyes of many people for the disastrous April 2010 oil spill in the Gulf of Mexico.

Conservationists such as myself who also recognize that big business, including big oil, is what fuels our economy, have had our radar finely tuned to the efforts and progress of healing the Gulf’s environment and economy since the spill.

The results have been nothing short of amazing in such a short amount of time since the disaster. The Gulf’s economy has rebounded dramatically, and it appears the environment is well on its way to a healthy recovery.

We owe a huge debt of gratitude for the herculean efforts of BP for this.

BP has spent well in excess of $20 billion cleaning up the Gulf and compensating its residents for the damage of the spill. BP undoubtedly will spend billions more in the coming years. The corporation’s stewardship and successful efforts to restore the Gulf make one of the greatest stories not being told.
Only in America. 

Futures Don't Mean Squat ... But I'd Rather See Green Than Red -- The Bakken, North Dakota, USA

Futures here -- up $1.00 to around $100.

China's GDP tops forecast

Meanwhile, Saudi targets $100 oil.
Saudi Arabia is aiming to keep oil prices at about $100 a barrel, a third above its previous public target, in a sign that Riyadh needs higher oil revenues to sustain a big rise in public spending.

Ali Naimi, the Saudi oil minister, on Monday for the first time said the world’s largest oil producer aimed to keep oil prices at the triple-digit level. 
As noted before on this blog, Saudi has set a floor of $87 to produce a barrel of oil.

Analysts Are Paid For This: Shutting Down Half of Region's Refineries Might Impact Availability of Products -- But There Is Still Some Great Information -- Thanks To a Reader

Link here.

I can't make this stuff up.

The government says this could result in an impact:
Reduced refining activity in the US Northeast, as reflected in recently announced plans to idle more than half of the region's refining capacity, is likely to affect product supplies, the US Energy Information Administration said. "The transition period as supply sources shift could be problematic for ultralow-sulfur diesel [fuel], gasoline, and jet fuel supplies," it said in a Dec. 23 analysis. Prolonged uncertainty in the coming months over disposition and operation of pipelines, ports, storage facilities, and other important logistical assets may compound adjustment challenges, it continued. Prices could grow more volatile because of reduced short-term product flexibility due...
Paid subscription required for rest of story.

However, for free, thanks to an "anonymous" reader who sent me the link to the entire EIA document, this is a bit more information:
Three southeastern Pennsylvania refineries that comprise over 50% of the total refining capacity in the Northeast (Central Atlantic and New England States)  have recently been proposed for sale.

Two of these refineries have already been idled. In early September 2011, Sunoco announced plans to sell its refineries located in Philadelphia and Marcus Hook, Pennsylvania, with the intent of exiting the refinery business by mid-2012.

Later that month, ConocoPhillips announced its intention to idle its Trainer refinery pending its sale, along with the associated pipelines and terminals.

On December 1, Sunoco announced the immediate idling of the Marcus Hook refinery.

Northeast refiners, in general, supply a diminishing market share of products in their own region. The balance of product supplies are either imported or moved into the region via pipeline from the Gulf Refineries on the East Coast mainly serve the Northeast, supplying approximately 40% of Northeast gasoline sales and 60% of distillate sales in 2010. About half of this supply came from the three refineries expected to be offline.

In 2010, the three refineries at issue combined to produce 315,000 bbl/d of gasoline, 194,000 bbl/d of distillate and 41,000 bbl/d of jet fuel. Distillate volumes produced included 143,000 bbl/d of ULSD mainly for on road use and 51,000 bbl/d of higher sulfur distillate that is primarily sold as heating oil.

Production losses from the Trainer facility idling were offset, at least in some measure, by the return to full operations in October 2011 of the Delaware City, DE refinery, which had been idled since late 2009. The idling in December of the Marcus Hook refinery removed 15% of the operating Northeast refining capacity.
For the full PDF report:
http://media.philly.com/documents/Reduction_in_Northeast_Refining_Activity.pdf

Now I Know Why "We" Are in Pakistan -- That's Where "We" Get Guar Gum -- Why I Love To Blog: Reason # 3,498 -- All About The Bakken and Pakistan, North Dakota, USA

Update

August 3, 2012: Fears of guar shortage overblown; not a problem.

June 6, 2012: Halliburton warns on 2Q12; margins will be hurt by higher cost of guar gum.  Link to Rigzone.

January 18, 2012: funny how things work out. I posted the note below a couple days ago, really not expecting to update it so quickly. One of the "things" I noted below was the urban myth about drug-containing coffins coming back from the Vietnam War -- and then suggesting stranger things have happened.

Today, taking up almost the entire front page of the Boston Globe is the story of the Massachusetts-prison-escapee-turned-Liberian-president Charles Taylor. It turns out that the "urban legend" that Chuck was working for the CIA (or similar agencies) wasn't all that far-fetched.

Original Post
Link here.

Data points:
  • Fracking uses a lot of guar gum.
  • Fracking has boosted the price of guar gum from 50 cents to $3.00/pound.
  • Guar gum is used throughout the food industry; particularly notably, the ice cream industry.
  • Guar gum comes from drone-infested Pakistan and non-drone-infested India. 
  • The EPA will re-define guar gum as "diesel."
Greg started sending me e-mails regarding guar gum earlier this month. I got the above link from "anon 1" today.

That fifth data point was a joke. I made that up about the EPA redefining guar gum as "diesel" although I don't put it past them.

Two comments:
a) Now I know what the US and the Taliban are fighting over: gum.
b) This reminds me, in a very peculiar way, of the movie, American Gangster, which continues to haunt me and will haunt me for a very long time. 
*******************
As long as I mentioned American Gangster, I might as well cross over into the dark side. I don't recommend anyone read below the asterisks. This has nothing to do with the Bakken.  It's simply for my archives. 

I don't recommend anyone reading any farther (further?) because it can't possibly make sense to anyone other than to me, connecting dots that reside somewhere in my paleomammalian brain.

[During the day, my mind does these things to me; after midnight it's something entirely different.]

I am reading Caroline Alexander's book on the Trojan War. She references WWI and the Vietnam war (I haven't finished the book yet, so I don't know if she references the "wars" in Iraq, but she might as well).

The movie left me with haunting visions of heroin-filled coffins coming back from Vietnam, an urban myth but not far-fetched. The fog of war. Cynical NCOs. Clever NCOs. Opportunistic NCOs.

And maybe not an urban myth. It's easy to say "not possible." But it's harder to answer, "then how."

The Trojan War was ten (10) years long, Homer says. (The Iliad covers but two-weeks of that war.)
The Vietnam war was a ten-year war for the US (~ 1964 - 1975) and a 20-year war for the Vietnamese (~1955 - 1975). The Iraq war(s), certainly, as long. I can't remember if it was Caroline that pointed it out, or someone else: take any 100-year period in the last 5,000 years and one will discover that a major war was occurring somewhere on earth in 94 of those 100 years.

Ten years is a long time for lifers to get cynical. A lot of time for thinking. It's the kind of story the government would quickly label an urban myth. 

[Well, this is interesting. I'm on the second floor of the Starbucks overlooking Harvard Square. Moments ago a black-and-white drove up on the brick-laid pedestrian/kiosk/subway adit. Car running. Not blocking, but certainly impeding the entrance/exit to the subway. Now a "transit policeman" with coffee cup in hand, having pulled up in his blue-and-white, is now approaching the former. Well, whatever it was, it's over. The black-and-white has driven off; the transit policeman has gone below. With coffee cup in hand.]
Crime Story, Del Shannon

And so it goes.

The paleomammalian brain is filled with more trivia and emotion, only to be stomped by the neopallium. The blue-and-white is still there.

How Good Is the NDIC? Compare It To New York -- No Comparison -- The Bakken, North Dakota, USA

Update

Five minutes after original post: see first comment. "Anonymous" says New York State does have a map of its gas and oil wells. Memo to self: forward this post to the EPA. One has to really wonder about the EPA.

Original Post
Link here.

I assume "anon 1" has additional reasons for sending me this link but I was flabbergasted to read this advice from the EPA to New York State:
The federal agency also wants New York to develop a map of gas wells and to update it at least monthly to provide more information on drilling activities to the public.
A map! Update it at least monthly? Give me a break!

Neither the EPA nor the state has a map of gas wells in New York! And folks wonder why South Korea is light years ahead of the US in applied technology.

I have looked at a fair number of mineral/oil/gas sites for sites in the midwest/west -- never thought of looking at the New York (I don't even know if it exists) -- and have remarked on one occasion: the NDIC site is the best of the lot. And not by a small bit, but by a large margin.

I was lucky enough to "grow up" on the NDIC GIS map server. The first time I ever went to it, it seemed a bit foreign -- in fact, I think it was the first time I learned about "GIS." But with no instructions, I figured it out fairly quickly. There are still (a lot of) things I don't know about the NDIC GIS map server, I assume, but that's a personal problem, as we used to say in the Air Force.

GIS is not a trivial event. It's huge. I am impressed that North Dakota state has it. I think there is a private app for locating wells, but that would be the next best thing the NDIC could do: provide an app (or multiple tablet apps for the Williston Basin).

New York State has no map of its gas wells! I think there are at least four interactive, dynamic maps for North Dakota: NDIC, ESER, UND, and that app.