Arctic Sea Ice Extent -- April 16, 2022

Link here. 

You Mean Arctic Cooling Is NOT Due to Covid-19? September 3, 2021

I'm waiting for Dr Fauci to weigh in but right now, BBC is reporting that the Arctic cooling we are now seeing is not due to Covid-19.

On another note, not one word about Afghanistan in past two days. As a reminder:

"Making Others Great Again" -- US Policy In The Arctic -- May 28, 2019

We had the Monroe Doctrine, the Truman Doctrine, and now the Obama Doctrine. 

Back on May 11, 2013, this post:

Add China to the list of those "playing" in the Arctic. President Obama ceded the Arctic to everyone but the US as part of his "Make Others Great Again" policy.

The sum total of US government involvement in the Arctic: one Coast Guard icebreaker.

Now, an update. From zerohedge:

Looking at the current situation and the emerging trends, it would appear that the two Eurasian powers, Russia and China, will remain dominant in the Arctic at least during the coming decade.

While the United States is starting to get into the game, it is clearly very low on its list of priorities.

The fact that the US capabilities are being stretched very thin indeed and the sorry state of America’s finances mean that US Arctic capabilities, military or otherwise, will receive veritable crumbs in terms of funding.

Canada’s sovereignty is being gradually eroded by the United States and may lose its status as an Arctic player altogether in the next decade, particularly if icebreaker construction will have to compete for funding with the F-35 fighters which the United States is bent on imposing on Canada.

China remains the wild card. At the moment, it seems content to rely on Russia’s icebreaking capabilities in the region, however, should US-China competition in the region intensify, the PRC will become more proactive in exerting its influence in the region.

Russia And The Arctic: The Obama Legacy -- March 12, 2019

Another footnote for the Obama presidency chapter in the next edition of US History: under President Obama, the US ceded the Arctic to Russia, the Canadians, the Norwegians, the Danes. See this post. The original post was dated May 11, 2013. Truly amazing. Now this story: Russia's next oil boom is happening in the Arctic. Memo from Vladimir to Barack: thank you, Mr Obama.

One of the major challenges of the 21st century is without doubt climate change.

For most countries, global warming poses a serious threat. Russia, however, has identified opportunities when it comes to the changing climate and the gradually decreasing icecap of the Arctic region. Moscow’s Arctic Strategy is intended to provide an edge for the Eurasian country in the areas of energy and defence while at the same time promoting the Northern Sea Route as an alternative shipping route.

Russia has vast oil and gas reserves in the Arctic. In terms of technically recoverable energy, the region contains as much as 90 billion barrels of oil and 47 trillion cubic meters of natural gas of which the Russian zone has the largest share, 48 billion barrels of oil and 43 trillion cubic meters of gas respectively. It amounts to 14 percent of its oil and 40 percent of its gas reserves. Despite global warming, the harsh weather conditions in the Arctic region require specialized infrastructure to extract and transport the oil to consumers.

Russia regards the Arctic as a strategic area where it is willing to invest significantly to secure the largest and most important share for itself. Moscow supports its claim by arguing that the crust structure of the Lomonosov ridge corresponds to the nearby Russian continental shelf which gives it the sole right to exploit much of the Arctic region. For this purpose, the Arktika research expedition vessel was dispatched in 2007.

Moscow is expanding its Arctic infrastructure with massive investments which dwarf those of the remaining littoral states. If the other Arctic countries do no begin investing in critical infrastructures such as harbors, airports and ice breaks, they could soon find themselves left behind in a new race for the North Pole.

Much more at the link.

Of course I don't agree with the premise of the disappearing Arctic ice cap (which turns out not be true except on the far western Arctic where it coincidentally / ironically benefits Russia. God has a sense of humor.

The big takeaway for me: regardless of what side of the global warming fence one stands, the writer suggests that Russia was looking for ways to take advantage of global warming, whereas the Obama administration -- like the Carter administration on peak oil -- simply wrung its collective hands, made speeches, and told Americans "it was out of our control."

Geo-Fossil-Fuel-Politics: Under Previous Administration, The US Conceded Future Fossil Fuel Arctic Exploration To Others -- October 18, 2018

Today it's being reported that Saudi Arabia is more than happy to fill that vacuum. Oilprice.com is reporting:

Now that global oil markets have gotten used to Saudi-Russian oil production cooperation that first hit the scene in early 2017 in an effort to reign in global price concerns, it now appears that the two fledgling allies are also going to cooperate in the liquefied natural gas (LNG) sector. And this time too, it looks as if the alliance could take aim at U.S. energy ambitions.

The kingdom’s media savvy energy minister Khalid Al-Falih said at the India Energy Forum in Delhi on Monday that Saudi state-owned Saudi Aramco is open to the idea of marketing some of the LNG from the proposed Russian Arctic LNG 2.

“Aramco has the mandate to go global and not only invest in downstream but also invest in gas and LNG. We have looked at projects in Africa and the Mediterranean, and of course the Arctic with some Russian companies, Novatek. The idea is that Aramco will trade that [LNG] globally and bring some of that to India and other markets,” Al-Falih said.

Murder in the consulate? What murder? That's so yesterday. 

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Poll: Should Trump Close US-Mexico Border ...

... Before/After The Mid-Term Elections

Updates

October 19, 2018: I suggested that a couple of well-placed phone calls would stop this. It is now being reported, but not confirmed, and has not been reported widely in the mainstream media yet, but apparently the mass of Hondurans -- which just reached the southern border of Mexico this past week -- is now disbanding and turning back. More to follow.

Original Post

This is very interesting. Binary thinking.

First binary choice: is the massing of Honduran "families" serious enough for the president to do something brash? Yes/No

President Trump is accused of being very brash. He comes across in word (tweet/rallies) as being very brash, but from my perspective he has been much more measured. His bark is louder than his bite is serious. So, for him to unilaterally close the US-Mexico border would be perhaps the most "brash" thing he has done.

If one feels he should not be so brash as to close the border then we move on. No poll. Nothing to see here.

But if the president (or it appears, John Bolton) sees this as a serious enough issue to do something as brash as closing the border, then it's a binary choice: close the border before the mid-term elections or close the border after the us mid-term elections.

From my perspective, regardless of whether it's the "right" thing to do or not, the anti-Trumpers would jump on this as a brash act by the president. Like the Kavanaugh circus, the merit of the decision would not be the issue. The "definition" and "defining" of "brashness" would become the issue. The issue may affect the Cruz-O'Rourke race. And not necessarily in a good way. As things stand, Cruz should win by at least a small margin. If Trump does something brash, Cruz might win by a bigger margin (so what? a win is a win regardless of the margin; ask Brett); if folks see Trump as being brash, then Cruz might lose by a narrow margin. Oh-oh.

Others will disagree. Others see the Cruz-O'Rourke race as a too-close-to-call and a brash act by Trump would cement a win for Cruz.

I think Trump could get just as good a response from Mexico if he personally spoke with the president, while at the same time sending the US SecState to visit the Mexican ambassador to the US, making it very clear, the border is closed the day after the election if the Mexican government does not stop the mass migration.

So, ignoring the question of whether the issue is serious enough for the president to take serious action, should President Trump close the border before the mid-term elections, or the day after the mid-term elections.

The poll is at the sidebar at the right.

The Heidi Heitkamp - Kevin Cramer debate is tonight. I think one will be able to tell how Heidi's internal polling is trending based on how she answers the questions. If she says she has brought huge bi-partisan support to the US Senate ...

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Polling

It will be interesting to see the overnight polling.

Most recent poll at this link:

Interruption In Blogging -- March 14, 2016

Later this morning, there will be an interruption in blogging. I will be biking to Southlake, where I will find a spot to begin blogging again.

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Reality Check

The Wall Street Journal reports that ENI has begun producing oil from the Arctic:Eni Starts Pumping Oil From World’s Northernmost Offshore Platform Italian company needs oil at more than $100 a barrel to break even at Arctic Goliat field.

After long delays and cost overruns, Italian oil company Eni SpA has started to pump oil from the world’s most northern offshore platform, Goliat, which is located in the Arctic about 50 miles from Norway’s northern coast.

Eni’s plans to begin pumping from Goliat were already two years behind schedule and well over budget when they hit another snag last December, as Norwegian regulators requested more information about safety and other issues before giving the green light.

The Italian oil and natural-gas company has invested about $6 billion in Goliat so far. With the continued fall in oil prices denting its margins, Eni is likely to struggle to make Goliat economically viable. Several analysts have put the break-even point for the platform at more than $100 a barrel. A spokesman for Eni said Sunday that the company expects the break-even point to be just below $50 a barrel.

Eni said in a written statement Sunday that Goliat, the first oil field to start production in the Barents Sea, is estimated to contain reserves totaling roughly 180 million barrels of oil. Its daily output is expected to reach 100,000 barrels. The Italian oil company holds a 65% stake in Goliat. Norway’s national oil company, Statoil AS A, controls the rest.

The only other time I blogged about the Goliat was on October 8, 2104. At that time the estimated cost was $7.21 billion. Something tells me $7.21 billion is closer to the real number than $6 billion.

And that's with a "b."

$6 billion for one platform. In the Arctic. Time for a reality check.

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The Amazon Page

Jeff didn't call if "Amazon" without a reason. Now, come the warehouses.

Delivery in a day is just too slow. At least, that seems to be the philosophy at Amazon, which in the last year has quietly built out a network of at least 58 Amazon Prime Now hubs in the US to fulfill one- and two-hour deliveries.

Those hyper-fast deliveries are available to Prime Now customers living in the high-density urban areas where the hubs have been built. 

The new warehouses—typically 50,000 to 60,000 square feet—are fed by Amazon’s 86 gargantuan fulfillment centers, but only with about 10,000 bestselling items as rated by the company’s internal data. An analyst said he could confirm 58 Prime Now hubs, but there could be more.

“This has probably been the most secretive piece of data that the company has not been talking about ... equivalent to Amazon having retail stores."

To slice away at shipping costs, the company is eliminating the middlemen in China who deliver goods from warehouses to seaports, opting to bring that job in-house. It also bought thousands of tractor trailers (not the trucks) to more efficiently load and ship goods. 

And most recently, Amazon announced it’s leasing 20 Boeing 767s to deliver its own goods to and from its fulfillment centers, a move that diminishes the company’s reliance on third-party shippers such as FedEx and United Parcel Service. The company’s flight hub will be in Wilmington, Ohio.

The new Prime Now hubs are one of three types of warehouses the company is running to further reduce third-party delivery costs. In addition to its fulfillment centers, it began in 2013 to build so-called sortation centers. Those warehouses are meant for nearby small-parcel shipping, which allow the company to shift deliveries from FedEx and UPS to the less-expensive US Postal Service.

“Nobody beats the post office when it comes to taking the cost out of shipping."

For example, if a customer in Boston bought a one-pound item through Amazon online, it was then shipped from the Breinigsville, Pennsylvania, fulfillment center by FedEx or UPS for about $4.50. Now, Boston shipments can be sent to a sortation center in Stoughton, MA, where the US Postal Service delivers the package for about 80% less.

At the link one can find how shippings costs for Amazon are surging.

By the way, my wife and I have found the same thing: UPS is exorbitant for mailing packages; lots of gimmicks that raise the price. The USPS is still the least expensive way to mail packages (that I know of).

By the way, the other thing Bezos has tapped into: human behavior. As delivery rates improve, and folks get used to shopping on Amazon, they become addicted. He can gradually increase prices of his products and folks won't even notice; they are still incredibly less expensive than traditional brick-and-mortar stores. The second American human behavior: consumerism. 

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Car Sales

There is an interesting story line percolating through the business news today, coming from many sources and many angles. Car sales are strong, but just below the surface things may not be what they seem. This report lists four reasons why car sales might be surging:

• increasing number of loans to those considered "bad" risks
• sales being "goosed" by ever-longer loans (I'm not sure if this is a legitimate concern)
• pushing "leases" that count as sales (I'm not sure if this is a legitimate concern)
• "dumping" sedans onto rental car companies and other bulk buyers (I'm not sure if this is a legitimate concern) 

A fifth reason was also listed, low gasoline prices, but that's pretty obvious.

The reason this story has some validity, at least for me, the issue of "sub-prime" loans for auto sales was also a big story for The Wall Street Journal today:

To understand how far the U.S. auto business has been reaching for new customers, consider the early performance of a bond issue called Skopos Auto Receivables Trust 2015-2.

The bonds were built out of subprime auto loans and sold in November. Through February, about 12% of the underlying loans were at least 30 days past due, a third of which were more than 60 days delinquent. In another 2.6% of loans, borrowers had filed for bankruptcy or the vehicles had been repossessed.

Those borrowers are at the outer fringe of the auto market. Still, the high level of missed payments for loans made so recently is a warning sign for an industry that needs every customer it can get to keep sales increasing at a record pace.

Update On The Arctic -- December 18, 2015

Oil & Gas Journal is reporting:

Royal Dutch Shell has terminated its contract for the Noble Discoverer drillship.

Alongside Transocean  Polar Pioneer semisubmersible rig, Discoverer was part of Shell’s Chukchi Sea exploration drilling program that folded in September, 2015.

The drillship is now in transit to Singapore where it will be stacked. Shell will pay Noble for the remaining term at 90% of the operating dayrate.

The Noble Sam Croft and Noble Tom Madden rigs remain under contract into July 2017 and November 2017, respectively, with Freeport-McMoRan Oil & Gas, which recently reported plans to reduce its number of rigs operating in the Gulf of Mexico.

Noble says it’s in discussions with Freeport-McMoRan on possible restructuring of the contracts.

Another One Bites The Dust, Spongebob Channels Queen
Greenpeace opens another bottle of champagne.

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Progress In The Arctic

Wood Mackenzie

From Rigzone, December 18, 2015.

The Arctic continental shelf is one of the least explored geological basins and has the potential for significant hydrocarbon discoveries.

Total estimated resources are comparable with those of the prolific West Siberian basin.

Interest from both International and National Oil Companies had grown over the past few years – bolstered by support from several Arctic governments. This has slowed recently as a result of a far lower oil price. However, it is not price alone which means progress will continue to stall in this region. Difficulties arising from insufficient geological knowledge, lack of infrastructure, harsh climatic conditions, the need for investment in new E&P technologies, and environmental concerns will all be factors.

The highest profile action in the Arctic recently has been Shell's decision not to progress its plans in the US' Chukchi Sea. Regulatory uncertainty and hurdles were major reasons behind its decision. 

Norway

• Norway's West Barents Sea Basin holds 45% of all Norway's offshore undiscovered resources
• around 6 billion boe
• Norway: leading region for Arctic exploration; favorable climatic conditions
• 150 wells since exploration began in 1970
• a quarter of those wells in last three years
• 2011: several discoveries added 1 billion boe
• mostly Statoil, but also LUKOIL, Rosneft, Wintershall, E.ON, Lundin Petroleum

Russia

• companies must create a joint venture with one of the approved companies (Rosneft, Gazprom, GazpromNeft
• Rosneft/XOM drilled the Universitetskaya well in 2040; short ice-free season precluded driling to depth; predominantly gas; 4 billion boe 
• pretty much no activity

US

• USGS estimates Arctic coastal shelf contains 30% of undiscovered oil resources in the region, or about 27 bioe
• high-profile Shell project canceled in 2015
• US to cancel 2016/2017 lease sales due to likely lack of adequate interest

Canada

• explored unevenly
• 26 discovered fields in the Beaufort-Mackenzie basin; at current prices, uneconomic
• discovered fields from the Franklinian-Sverdrup Basis also uneconomic

Greenland

• their offshore basins remain some of the most underexplored Arctic regions 
• Southwest Greenland Basin, estimate: 2.3 billion boe
• despite exploration all the way back to the 1970s, not a single discovery has been made
• no sign of recover in the near-term
• Statoil relinquished three exploration licenses in January, 2015, despite having an exploration term of 16 years and the government's proposal to postpone work commitments deadline by two years

Ice conditions and climate

• most exploration where areas are completely (Norway continental shelf) or mostly (eastern part of the Barents sea) ice-free on a seasonal basis
• Prirazlomnoye project stands out: its stationary platform is capable of withstanding millions of tonnes of ice, as successfully demonstrated last winter: hefty price: $2 bilioin on the the platform alone 
• year-round sea logistics requires an icebreaker fleet, which adds to operating costs; presently only Russia has a suitable fleet
• US has two functioning icebreakers, but only one in the Arctic
• Norway announced construction of its first non-military icebreaker for research to be completed by 2016
• neither Greenland nor Canada have icebreakers; nothing estimated to commence until 2020
• therefore, full-scale, year-round exploration and production in the Arctic is only possible on Norway's continental shelf and the western part of Russia's shelf 

Petroleum News Bakken Suspended For The Time-Being? -- September 28, 2015

It looks like the suspension occurred in July, 2015. Petroleum News is based out of Alaska, I believe.

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More Story Lines From Shell Calling It Quits In The Arctic

Oil & Gas Journal is reporting:

... the move “reinforces the idea that conventional drilling is fading fast and nonconventional is not going to fall by the wayside.” 

Investment in conventional drilling is waning in not only the US but around the world, ... Shell’s projects “in other areas of the world may also be dragging down their capital. 

“In areas such as the North Sea and Nigeria, we have production that remains viable, but at a loss to find consumers.”

“America was once the largest consumer of said areas, but has since dropped Nigerian crude imports to about 50,000 b/d this year,” he said. “That alone is a significant decline from 2012 when Nigeria was supplying the US with over 1 million b/d.”

Another shift in the import-export picture comes by way of US refinery utilization and production, which have hit record levels this year.

“America once was a major gasoline importer, mainly from Europe, and now has cut that number in half from peaks seen prior to 2011."

“The business about production in Alaska and the Arctic has always been a political hotbed,” he added. “As we head into the 2016 presidential elections, Keystone may not be the only oil-related argument on the table.”

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Meanwhile In Afghanistan

Being reported now:

The AP and New York Times, in reports on the fall of Kunduz, Afghanistan, describes it as a significant win for the Taliban. It marks the first time the Taliban has captured a major Afghan city since 2001.

Meanwhile, the President continues to talk about global warming with the Chinese.

Monday, September 28, 2015; Shell Calls It Quits In The Arctic; Apple Reports Record Weekend

Apple reports record sales of iPhone 6S, 6s Plus in first weekend:  13 million vs previous record of 10 million (2014) -- though most recent numbers included China whereas not so in 2014;

Shell Oil in Arctic: not enough there to justify drilling. Will quit drilling; call it quits. See more at the bottom of this post -- scroll down.

Alcoa to split into two companies.

Russia surprises US with accord to fight ISIS. President Obama may agree to keeping Assad in power.

Williams and ETE reach deal.

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Active rigs in North Dakota:

	9/28/2015	09/28/2014	09/28/2013	09/28/2012	09/28/2011
Active Rigs	70	190	184	190	195

RBN Energy: 7th of 8 in the series on propane.

This is the seventh episode in the series. Episode 1 provided an overview and introduction to the analysis – beginning with the dramatic increase in propane production over the past 7 years.

Total U.S. propane output has increased by nearly 70% from an average of 0.8 MMb/d in 2008 to 1.4 MMb/d during the 1^st half of 2015. Most of that growth has been driven by production from gas processing plants that has more than doubled from 0.5 MMb/d in 2008 to 1.1 MMb/d in 2015. The overall growth in propane has outpaced domestic demand such that as much as 50% of the total is now exported to balance the market – even as inventories are at all time high levels. [Back on September 23, 2015, Jack Kemp reported: Record propane stocks show first weekly drawdown since March; graphs are incredible; huge records being set.]

RBN’s analysis for PERC sought to understand changes to the propane market since the disruptive winter of 2013-14 as well as how susceptible today’s market is to similar events and what actions should be taken to reduce the risk of it happening again.

Our approach to the analysis involved developing a monthly model of U.S. propane supply, demand, logistics and pricing at the PADD (Petroleum Administration District for Defense) level using historic propane market data.

In Episode 2 we outlined supply and demand scenarios for the model based on oil price Growth and Contraction as well as Normal and Severe weather patterns. Episode 3 took a closer look at propane production by PADD region – noting the dramatic growth in the Northeast as well as the Midwest.

Episode 4 detailed regional historic and future projected propane demand by PADD and Episode 5 looked at the main domestic propane demand sectors. Episode 6 highlighted how new infrastructure has improved interregional connectivity across the propane market. This time in Episode 7 we consider how developing regional supply/demand balances and infrastructure could be impacted by a worst-case combination of low propane production and severe weather.

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$7 Billion, 7-Year Disappointment

FuelFix is reporting:

Royal Dutch Shell on Monday said it was abandoning a $7 billion, seven-year quest for crude under Arctic waters, after an exploratory well failed to find significant amounts of oil and gas.

Shell’s exploratory oil well in the Chukchi Sea north of Alaska encountered “indications of oil and gas” but the company said they were “not sufficient to warrant further exploration” — a significant blow for the Anglo-Dutch firm that had hoped to find a multibillion barrel crude reservoir in those remote waters.

“Shell continues to see important exploration potential in the basin, and the area is likely to ultimately be of strategic importance to Alaska and the U.S.,” said Marvin Odum, the Houston-based director of Shell Upstream Americas. “However, this is a clearly disappointing exploration outcome for this part of the basin.”

Shell said in a statement that it would cease further exploration activity off the coast of Alaska “for the foreseeable future.” “This decision reflects both the Burger J well result, the high costs associated with the project and the challenging and unpredictable federal regulatory environment in offshore Alaska,” the company said.

Shell also will take a financial charge from the decision, since the firm’s Alaska assets have a carrying value of about $3 billion and the company still has an additional $1.1 billion already committed in existing contracts for rigs, ships and other assets. Shell could pare its potential $4.1 billion write down by putting some of those contracted vessels to work elsewhere or subcontracting them to others.

The full extent of the financial damage will be described on Oct. 29, when Shell announces its third-quarter earnings. But the blow could be especially significant when cast against falling earnings. Shell’s second quarter profit was $3.8 billion, compared with $6.1 billion for the same period last year. First quarter earnings were $3.2 billion, down from $7.3 billion in the first quarter of 2014.

Shell was pursuing a major Arctic oil discovery after spending a record-setting $2.1 billion to buy 275 Chukchi Sea oil and gas leases in a 2008 government auction.
Because of the costs of extracting oil and building the infrastructure to deliver it to market, Shell CEO Ben van Beurden bluntly warned earlier this year that the economics of Shell’s Arctic project would only work “if the structures are full of oil.”

For $7 billion, an operator could drill 1,000 wells in the Bakken with an almost-predictable guaranteed return. 

President Obama Approves Arctic Drilling -- Actually He Approves Shallow Sea Drilling -- May 11, 2015

There are so many ifs, ands, and buts, and conditions for any drilling to commence but it is what it is. CNBC is reporting:

The Obama administration gave conditional approval on Monday to allow Shell Gulf of Mexico, Inc. to start drilling for oil and gas in the Arctic Ocean this summer.

The approval is a major victory for Shell and the rest of the petroleum industry, which has sought for years to drill in the remote waters of the Beaufort and Chukchi seas, which are believed to hold vast reserves of oil and gas.

Activists trained on kayaks last week in Puget Sound in advance of a floating protest of Royal Dutch Shell in the Port of Seattle.

The Port of Seattle has agreed to a lease with Royal Dutch Shell that would allow the petrochemical giant to bring its Arctic Ocean drilling rigs to the city's waterfront.

This is how CNBC is reporting it. In fact, much of the story was not reported.

The Interior Department decision is a devastating blow to environmentalists, who have pressed the Obama administration to reject proposals for offshore Arctic drilling. Environmentalists say that a drilling accident in the icy and treacherous Arctic waters could have far more devastating consequences than the deadly Gulf of Mexico oil spill of 2010, when an oil rig explosion killed 11 men and sent millions of barrels of oil spewing into the water.The move came just four months after the Obama administration opened up a portion of the Atlantic coast to new offshore drilling, adding a new chapter to the president's environmental legacy. 

Environmentalists opposed to this are attaching boat trailers to their SUVs as we speak, to put kayaks on the boat trailers, and will join others to oppose this most recent action. 

Blink?

Updates

November 21, 2014: I don't particularly "like" this story. I think it's way too early to say. But I will link it for archival purposes. Bloomberg is reporting:

OPEC was mistaken in thinking that U.S. shale oil production would be unprofitable once crude prices slipped below $90 a barrel, according to Pulitzer Prize-winning author Daniel Yergin.

Original Post

Reuters via Rigzone is reporting:

A subtle shift may be taking place within OPEC as it heads into its most important meeting in years, according to delegates with the producer group, as the discussion over whether it needs to cut output to defend oil revenues quietly intensifies.

OPEC's Secretary General Abudulla al-Badri this week urged markets not to panic over the drop in prices to a 4-year low near $81 a barrel, while Kuwait's oil minister said OPEC was unlikely to cut output when it meets on Nov. 27 in Vienna.

But privately, more delegates within the Organization of the Petroleum Exporting Countries are starting to talk of the need for the group to take some action, although they warn that reaching an agreement will not be easy.

That could involve reducing output by around 500,000 barrels per day (bpd), the amount OPEC is currently producing above its output target of 30 million bpd, according to its own figures. That could serve as a face-saving compromise between those willing and opposing a formal cut.

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Mixed Messages

A big "thank you" to Don for noting the irony or mixed messages in this report. The AP is reporting:

While the Obama administration, Congress and the Coast Guard all say maintaining at least one heavy icebreaker is essential for maintaining U.S. security and science, no funding proposals have yet gained momentum to have a new heavy U.S. icebreaker built before age forces the Polar Star out of service, any time from five to 20 years from now.

Without active heavy icebreakers, "the control of the Arctic is in the hands of Russia," California U.S. Rep. John Garamendi, the ranking Democrat on the House subcommittee that oversees the Coast Guard and maritime affairs, said Tuesday.

The Arctic is estimated to hold more than 10 percent of the world's undiscovered oil reserves, nearly one third of undiscovered gas reserves, and remains a strategically critical area for the United States, congressional researchers said earlier this year.

Melting ice means traffic has increased in the Bering Strait, between Russia and Alaska, 118 percent since 2008. More melting means more vessels will be coming within harm's way of ice.

Meanwhile, researchers say study of the 1.5 million-year-old ice of the Antarctic is critical to tracking the Earth's increasingly variable weather and the course of man-made climate change.

Under the Obama administration, the US has pretty much written off the Arctic. 

Arctic Sea Lanes, The US Navy, And California Wind Turbines

The AP via Rigzone is reporting:

The U.S. military is looking for ways to expand operations in the vast waters of the Arctic as melting ice caps open sea lanes and other nations such as Russia compete for the lucrative oil and gas deposits. But the effort will take money and resources to fill the broad gaps in satellite and communications coverage, add deep-water ports and buy more ships that can withstand the frigid waters or break through the ice.

President Barack Obama in May unveiled a 13-page U.S. strategy for the Arctic, asserting that nations must protect the region's fragile environment and keep it free from conflict. At the same time, however, the U.S. wants to make sure it is not left behind as countries like Russia, China, Canada and Norway map out plans ranging from gas and oil exploration to research and military exercises.

U.S. officials estimate the Arctic holds 13 percent of the world's undiscovered oil reserves and 30 percent of undiscovered gas deposits. Until recently, however, areas that could reap hundreds of billions of dollars in revenues were frozen over and unreachable.

There are certainly mixed messages on the Arctic. Up until "recently," yes, the Arctic ice cap was shrinking, opening sea lanes, but reports this year suggest the trend is changing.

Regardless, the US is poised to cede 13 percent of the world's undiscovered oil reserves  and 30 percent of undiscovered gas deposits to the Russians, the Norwegians  the Canadians, the Brits, and the Danes. Does it matter? By the time these reserves and deposits are commercially available, the US will be covered with solar panels and wind turbines.

Speaking of which, a reader sent me this story, originating in Altamont, California. It appears that at least one "locality" has come to its senses and is angry over the slicers and dicers. A developer plans to retire "old" slicers and dicers with taller ones that will kill less birds. The company appears it won't be able to meet the September, 2014, deadline.

The company is asking to eliminate the September deadline for this year's scheduled phase-out by postponing it until 2015, which is the deadline for the next step of wind turbine phase-out.

Opponents say that the postponement would result in additional bird deaths.
AWI has not put up any new turbines, because it does not have a new contract with a power company to purchase power in the future. However, the company is working on a contract, said AWI president Rick Koebbe.

If things go about the way one expects it to go, the company will end up declaring bankruptcy, and the old turbines will be there "forever."

"Gold Rush" In The Arctic; US Unlikely To Participate; US Will Let The Russians, Canadians, Norwegians, Danes Take The Lead; Heaven Forbid The President Could Make A Decision That Fast

 Updates

May 28, 2019: Zerohedge updates the Obama Doctrine.

March 30, 2019: court agrees. The Arctic belongs to Denmark, Norway, Russia, Canada, China, others, but not to the US. The US cedes the Arctic to the rest of the world. Link at WSJ. 

March 15, 2019: now it's Norway. Norway announces plans to expand exploration areas in the Arctic. Thank you, Mr Obama.

March 12, 2019: Russia's next oil boom is happening in the Arctic.

August 29, 2015: US ceding the Arctic to Russia, New York Times. 

August 4, 2015: Los Angeles Times headline -- Russia claims 460,000 square miles of the Arctic -- and the area's oil and gas resources.  That was easy. GOP slams Obama on this, August 8, 2015.

September 27, 2014: Russians discover huge reservoir of oil in the Arctic; could be bigger than "the US part of Gulf of Mexico."

June 19, 2013: Norway moving closer to the Arctic; US will not participate.

June 5, 2013: add the Chinese to the list of "everyone" looking to drill the Arctic for oil.

May 13, 2013: I posted the link/article a couple of days ago. Now Bloomberg is confirming exactly what I said. The US is the only Arctic player without a policy: it's going to be a "land grab" and the US won't be participating -- at least not in any meaningful way. Russia, especially, sees Obama as a paper tiger. 

Original Post 

 

The Houston Chronicle is reporting:

The icy Arctic is emerging as a global economic hot spot — and one that is becoming a security concern for the U.S. as world powers jockey to tap its vast energy resources and stake out unclaimed territories.

Diplomats from eight Arctic nations, including Secretary of State John Kerry, will meet next week over how to protect the thawing region as its waterways increasingly open to commercial shipping traffic.

U.S. officials estimate the Arctic holds 13 percent of the world's undiscovered oil reserves, and 30 percent of undiscovered gas deposits. Until recently, however, the lucrative resources that could reap hundreds of billions of dollars in revenues were frozen over and unreachable.

But global warming has melted sea ice to levels that have given rise to what experts describe as a kind of gold rush scramble to the Arctic.

On Friday, President Barack Obama announced a new U.S. strategy for the Arctic, calling the region "an amazing place" and maintaining a need among nations to protect its fragile environment and keep it free of conflict.

"An undisciplined approach to exploring new opportunities in this frontier could result in significant harm to the region, to our national security interests, and to the global good," the 13-page strategy concluded.

The Arctic is getting hotter faster than any part of the globe. Experts predict the region will be free of sea ice during the summer within about 20 years. Sea ice is important because it keeps the rest of the world cooler, and some scientific studies suggest that its melting may be indirectly connected to the extreme weather in the United States and elsewhere in the past few years, changing global weather patterns, including the track of Superstorm Sandy.

President Obama won't have to worry about any "conflict" in the Arctic. As long as the US stays out, the Canadians, Danes, Norwegians, and Russians will be more than happy to split the spoils. If the president can't even come to a decision on a pipeline, he will never come around to a decision on the Arctic.

And so it goes.

But the nice thing about free market capitalism: investors can buys shares in foreign oil companies that will drill the Arctic. Like Statoil. And it will be US oil service companies that will partner with foreigners in the Arctic, like Halliburton (which at one time was run by Dick Cheney), TransOcean, and Schlumberger. Oh, that's right. Schlumberger is French. And TransOcean --- I don't know what they are any more; their offices are in Switzerland, I believe.

With the Arctic sea lanes opening up, Susan Sarandon and Johnny Depp can take their private cruises up to the pole to watch the drilling.