Energy Independence

At this rate, "we're" never going to get to there.

The first US off-shore wind energy project has been in the works for over ten (10) years now.  Just when it appeared to be ready to begin building, just when it appeared all environmental impact statements had been filed, just when all permits had been issued, "we" now have another lawsuit from the .... environmentalists. Teddy Kennedy (RIP) would be proud.

Even in the far west, some have had it with transmission lines.  This story is about landowners in Montana against transmission lines going south to Utah. It would go against their "no-growth" policy.

The Bakken continues to be one great play while the rest of the US dithers.  Of course, the issue of the EPA and fracking is the 800-pound gorilla in our backyard.

A Policy Problem, Not An Energy Problem

More confirmation that we have a policy problem, not an energy problem.

This one "district" in Wyoming has about half the entire coal reserves in the US.

The Powder River Basin coal mining district in Wyoming is regarded as the most prolific coal mining model in the industry to date. Some 14 active coal mines extract more than 400 million tons annually, and two railroads deliver that coal to some 37 states.

The district is said to have a capacity upwards of 500 million tons annually, which would amount to half the United States coal supply.

News Summary, June 24, 2010

I will be posting a bit less often for the next few days. I am traveling for the next few days.

I see the market had another tough day but oil held its own. I haven't checked share prices of any of the energy companies, but for long term investors this could not be a better time to accumulate shares. It's possible (and likely) the market will go down some more, and it could drop significantly. But I am not a market timer. I mostly dollar cost average, but when the market is down, I try to find cash to accumulate more shares for the long term.

I see Anschutz was granted two new permits today; the wells will be in two different fields in Dunn County: Fayette oil field and Manning oil field. They will sit on the same pad; one long horizontal going north into Fayette and one long horizontal going south into Manning.

I also noted that the number of active rigs has dropped from a high of 130 (it was there for just one day) back to 122 today. Not sure what that's all about, except I assume it's just normal rotation of rigs. However, one has to keep in mind: a) backlog of fracking crews; b) shortage of manpower; and, c) significant drop in oil price from $80+ with indications that global economy isn't going to turn around any time soon.

I see the Federal government lost the first round with regard to the executive order to shut down new drilling in the gulf. In fact, the Federal government has lost several recent high visibility cases in front of the Supreme Court, including one favoring Enron today.

I see aviation folks are unhappy (on both sides of the issue) regarding wind power and interference with radar. This was a major concern with the Cape Wind project off the Massachusetts coast, also. It certainly appears wind power is not the panacea some make it out to be.

I reported yesterday (or was it the day before) about Hess building a oil loading railroad facility. I see a major North Dakota newspaper picked up on that story and is reporting it today. This is a big, big deal: $48 million project; 120,000 barrels a day on two 100-unit trains daily. Other news in that article:

North Dakota's pipeline, rail and refining capacity is about 400,000 barrels a day and more than double the volume two years ago, said Justin Kringstad, director of the North Dakota Pipeline Authority.

North Dakota surpassed Louisiana last year as the fourth-largest oil-producing U.S. state, with nearly 80 million barrels of oil. Hess was the fifth-biggest oil producer in North Dakota last year with about 6.6 million barrels, industry records show.

Hess announced in April that it also plans a $325 million expansion to its natural gas plant in Tioga. The company said it wants to increase capacity at the plant from 100 million cubic feet of natural gas daily to 250 million cubic feet.

And that's about it for now. But again, I apologize for few postings for the next few days. Thank goodness for the internet and particularly the Drudge Report. There are breaking stories on both the internet in general and the Drudge Report in particular that are very significant and not yet being reported by the major newspapers, such as the New York Times or the Los Angeles Times. We could have an interesting summer. 

Just a BP Quickie

Until the BP spill, "everyone" spoke of volume of oil in barrels. During the first few days after the disaster, reported continued that trend, quantifying the spill interns of barrels of oil. But then, a few weeks later, the reporters began to write their stories using gallons instead of barrels to quantify the amount of oil spilled, collected, or burned.

That small change results in a number 42 times larger than how it is usually reported. Fair and balanced.

On another note, I don't possibly see how BP can survive as a company without declaring bankruptcy. This would not be setting a precedent. Texaco declared bankruptcy back in 1987 following a lawsuit with Pennzoil.

Update -- August 6, 2010:

• This became a non-story over time. The oil has disappeared. The media is upset there is no video. All they can do now is complain about the dispersants that were used, hoping that Congress bans them in the future, so better video of oil-tarred seagulls, pelicans, seals, polar bears can be filmed. What hypocrisy. 
• BP is probably wishing they hadn't acted so rashly selling all their assets for a debacle that became less-than-a-debacle.
  

Update -- July 20, 2010:

• The company has spent $3.95 billion so far with regard to the clean-up.
• The company is under pressure to set up an independent escrow account, just to get started, of $20 billion. 
• BP has committed itself to raising $10 billion this year (the year is half over) for the clean-up.
• BP's cash position is $7 billion. 
• BP has $32 billion in debt.
  BP's annual operating cash flow is $30 billion.
• Today BP announces plans to sell off assets worth $1.7 billion to start building that $10 billion. 
• BP's market cap is $108 billion.

Wyoming Wind Taxes Highest Among Neighbors

If planned taxes go into effect, Wyoming's taxes on wind would be highest among its neighbors.

The story lacks much financial information. For example, there is no comparison between taxes on fossil fuels and wind energy on an energy-producing basis.

In addition, there is no cost estimate of the biggest bottleneck: lack of transmission lines. Someone has to pay for those lines. Again, the reporting on wind energy is lacking. I have nothing against wind energy; I just want everything to be "transparent."  Voters can then decide how they want to spend their money.