Friday, April 17, 2015 -- Renewable Energy Numbers -- Staggering

Chart of the day. This is from Carpe Diem, yesterday. Note that the percent of US energy from renewable sources was less in 2014 (7%) by a significant amount compared to 1950 (9%). The actual decrease is significant, but then if you add in all the money spent since 2000 to increase the amount of renewable energy, the numbers are even more staggering.  Don sent me the link. He provided the big reason why the percent of renewable energy took such a big hit over the last fifty years (see if you can figure out why -- I'll provide the answer later if I remember). Hint: think California.  Here's the chart:

I assume the delta between 90% and 100% in 2014 was mostly nuclear energy, but I don't know.

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Schlumberger: I may have gotten this wrong yesterday; I can't keep up. SLB will cut another 11,000 jobs bringing total to 20,000 cut jobs in current cost-cutting environment. Bloomberg is reporting:

Schlumberger Ltd., the world’s largest oilfield services provider, will eliminate an additional 11,000 positions in a sign the industry will undergo another round of job cuts as a result of tumbling crude prices.

The latest announced reductions bring the company’s total to 20,000, making its workforce about 15 percent smaller than it was during the third quarter of 2014. Schlumberger had announced plans in January to eliminate 9,000 positions, in what was then the single largest cut in the industry.

Setting us up?  Is Saudi Arabia setting us up for a huge spike in the price of oil? I agree with the thesis at this linked article, but I think there's a bit of hyperbole in the article.

Active rigs:

	4/17/2015	04/17/2014	04/17/2013	04/17/2012	04/17/2011
Active Rigs	93	186	185	206	175

RBN Energy: PAA -- getting oil to the Gulf coast.

The Plains All American (PAA) Cactus Pipeline comes online in the West Texas Permian this month (April 2015). Cactus will bring up to 250 Mb/d of crude and condensate from Midland and McCamey in the Permian to Gardendale, TX - the heart of the Eagle Ford shale – linking the two basins for the first time by pipeline.  It also forms a major component of an expanded pipeline and dock infrastructure owned by a combination of PAA and Enterprise Product Partners (EPD) set to deliver as much as 600 Mb/d of crude and condensate to Corpus Christi and 470 Mb/d to Houston by the end of 2015. Today we describe how a good deal of those deliveries will be processed condensate eligible for export.

PAA is one of the US midstream behemoths - handling about 4 MMb/d of crude oil and natural gas liquids (NGLs) as well as storage and terminal facilities for natural gas, natural gas liquids, crude and refined products. As we outlined in Part 3 of our “Come Gather ‘Round Pipelines” series last year, PAA own and operate significant takeaway capacity in the Permian – including the Basin pipeline to Cushing, the Mesa and Sunrise pipelines between Midland and Colorado City and (recently acquired) a 50% interest in the 300 Mb/d BridgeTex pipeline from Colorado City to East Houston (Magellan owns the other 50%). As we shall see, PAA also own a large crude gathering system in the Eagle Ford. Outside of Texas the company has midstream assets in the Bakken , Western Canada and the Rockies.

In the Eagle Ford, PAA operates a gathering system in the eastern section of the oil and condensate window of the play that is centered on Gardendale. In this part of the Eagle Ford, most of the liquid hydrocarbons are ultra light “lease” condensates having API gravity above 55 degrees. Lease condensate presents producers with a challenge because it has variable quality and is not favored by Gulf Coast refineries configured to process crude with fewer light end components – meaning that prices are regularly discounted. In the good old days before shale, when condensate production was low it was simply blended into the regular crude oil stream. With up to 45% of Eagle Ford “crude” production actually falling into the condensate category now, producers have struggled to find domestic markets. In the Summer of last year (June 2014) a new export market for lease condensate opened up as a result of changes in the interpretation of decades old regulations that lumped lease condensate together with crude oil and banned both from export.. Those export regulations – administered by the Department of Commerce Bureau of Industry and Security (BIS) limit the export of crude and lease condensate except to Canada and under a few special circumstances. However the BIS rules do allow exports of processed crude and condensate (i.e. refined products). As we explained in several blogs the BIS has opened up the market by blessing the export of condensate that has been lightly processed in certain distillation equipment.

 Great article; it will be archived at the source.