Wednesday May 21, 2008

Crude oil reaches record $129.60 on supply concern

This article belongs to the NYMEX crude oil price records story arc.

bloomberg.com :

Crude oil was little changed in New York trading after rising to a record $129.60 yesterday [20 May 2008] as billionaire hedge-fund manager Boone Pickens said prices will reach $150 a barrel this year. Producers are "running out of oil," Pickens said on CNBC. Prices have risen 94% from a year ago. A strengthening of the euro against the dollar added to the gains. The weakening dollar prompted the purchase of commodities as a hedge against the currency's decline. Oil advanced above $127 for the first time on May 16 when Goldman Sachs boosted its estimate for the second-half of the year to $141 a barrel, citing supply constraints. The Organization of Petroleum Exporting Countries' oil-export revenue will exceed $1 trillion this year, the U.S. Energy Information Administration said on May 6.

- Whoa, did you see that last part about OPEC bringing in $1 trillion this year? Incredible. Even with the falling US dollar and everything, that's a big chunk of change. As oil prices continue to head toward the stratosphere, this figure is only going to get larger. While the peakoiler community sits back and enjoys telling everyone "we told you so", the news media has been going nuts trying to explain the crude oil price lately. The previous item I didn't even bother to cover, because they were saying something about oil rising to the (then) record of $127.82 last Friday due to Goldman Sachs coming out with a report that said oil is going to $150. I know Goldman is a big financial institute and all, but imagine them having the power to move the trillion-dollar oil markets with a little report like that. Ha! I really don't think so.

The technical side of things looks interesting. Doesn't it always. We're rapidly approaching the $130 milestone, yet another nice and round number. I did wonder aloud earlier, whether $130 looked more like a possible resistance level than $120. If and when $130 is breached, we could probably "look forward" to resistance levels of $150, $200, $300 and over $400 later on. Support levels are at $120 (*cringe*), $110, $100 and $90. Now since when did $120 become support? Since the price broke through it as a resistance level, dudes! If there is to be a correction we might be testing $120 on the downside. We'll see.

See also :

1. Crude oil hits $126.98, extending record run to 7 days in a row
2. Crude oil pulls back after hitting $126.40, breaking records 6 days in a row
3. Crude oil caps record-breaking week by reaching $126.27 on NYMEX
4. Crude oil continues 5-day record-breaking run to reach $125.98

(2008-05-21 11:51:18 SGT) [Energy] Permalink

George Bush to Middle East : You are running out of oil

peakoil.com -> thescotsman.scotsman.com :

US President George Bush yesterday [18 May 2008] told leaders of the oil-rich states of the Middle East that they must face up to a future without their precious hydrocarbons. In a stark warning, he said their supplies were running out and urged them to reform and diversify their economies. The outgoing United States president told the World Economic Forum, meeting in the Egyptian resort of Sharm el-Sheikh, that it was time to "prepare for the economic changes ahead". Mr Bush's family name is inextricably linked to the oil industry, and this was his strongest statement yet on the future of global supplies.

The president's speech was made only days after he urged Saudi Arabia to increase oil production to ease prices at the pumps, as millions around the globe face increasing costs of filling up and even more grapple with rising food bills. Analysts warned last night that few in the Middle East, which has two-thirds of the world's oil reserves, are likely to heed Mr Bush. Many have already started diversifying their economies and do not like being preached to by someone so unpopular in the region.

- It's funny how George Bush is starting to talk about the issues surrounding peak oil nowadays. This is probably the second most useful thing he said, from a peakoiler's point of view, after the addicted to oil speech. It would have helped a lot more if he had said these things like a couple of years earlier, don't you think? Still, I'd suppose, better late than never. The next US president is going to be leading America into very interesting times.

See also :

1. Bush : 'America Addicted to Oil'
2. Bush 'prepares emissions U-turn'
3. The construction site called Saudi Arabia
4. Arab oil money

(2008-05-21 11:26:16 SGT) [Energy] Permalink

Singapore pulls a Trantor : power stations, warehouses, reservoirs going underground

channelnewsasia.com :

Land-scarce Singapore is already storing some of its military munitions in this way. And work is underway on similar storage facilities for crude oil and oil products. Now, the Government wants to look at building power stations, warehouses, incineration plants, airport logistics centres and reservoirs all below ground. Industrial landlord Jurong Town Corporation (JTC) last Friday [9 May 2008] called a tender for a "underground rock cavern usage feasibility study" to see how subterranean grottos could be used to maximise land use.

Last July [2007], TODAY broke the story of how government agencies including the JTC were exploring the feasibility of creating caverns for living. In March [2008], the Ministry of Defence opened caverns under the disused Mandai Quarry to store ammunition such as bullets, bombs and missiles. The JTC is constructing the $2-billion Jurong Rock Cavern beneath Jurong Island, for use by petrochemical companies. The first caverns under Phase 1 should begin operations in 2010.

- Singapore is already making as much use as it can with the 3rd dimension, with HDB (public apartment housing) flats going to 40 floors and beyond, and skyscrapers in the city area reaching over 60 storeys. Due to airplane flight path restrictions, they are unable to build any higher than that, so perhaps the logical next step is to go underground.

Building caverns to store ammo and crude oil may be a good idea, but I'm not so sure about actually living underground. It sounds like Singapore is trying to pull a Trantor here. The more we try to cram people into a limited land area with virtually no resources, the more we are going to be dependent on outside inputs for food, water and practically everything else. For as long as the country is still relatively wealthy and there are supplies to be had, we could continue in this direction, but things can change quickly, especially as we are approaching an era of resource scarcity ("peak everything").

See also :

1. Singapore to start work soon on $1 billion oil storage cavern
2. Asean mulls joint oil stockpile

(2008-05-21 10:48:00 SGT) [Env] Permalink

BP, Rio Tinto cancel $2 billion Australian clean coal power plant

peakoil.com -> bloomberg.com :

Rio Tinto and BP canceled a plan to build a coal-fired power plant in Australia that would capture and store carbon to cut emissions. The plant at Kwinana, which was being studied by the Hydrogen Energy joint venture between Rio and BP, won't be built after it was found that rock formations wouldn't seal in carbon dioxide. The project would have required $1.5 billion to $2 billion in investment.

In the U.S., the venture is working to use hydrogen derived from coal or natural gas to generate power and capture carbon for storage to minimize greenhouse-gas emissions. The project with Abu Dhabi National Oil Co., or Adnoc, which controls the United Arab Emirates' petroleum reserves, would pump carbon dioxide into oil fields, forcing out more crude. Currently, natural gas is used to create pressure inside the aging oil reservoirs to increase oil recovery.

- This is not the first cancellation of a supposedly "clean coal" power station project, nor is it likely to be the last. Earlier in Feb 2008, the FutureGen clean coal project in the US was cancelled. For the Australian project, the writing was already on the wall over a year ago, when leading Australian scientist Dr Tim Flannery said back in Feb 2007 that Australia did not possess the right geological conditions to support the clean coal process, which injected carbon dioxide emissions into the ground rather than releasing them into the atmosphere.

There is perhaps one very limited set of conditions where clean coal might possibly work : injecting the CO2 into an existing oil field for enhanced oil recovery (EOR), also known as tertiary oil recovery. Of course that pre-supposes that one would be building a "clean coal" plant practically next door to an operating oil field, and not just any old oil field but one with the right geological conditions where the CO2 injection technique might work. As you might expect, the list of candidate locations for this has got to be vanishingly small.

And now Singapore seems to want to try this. Can anyone show me where Singapore has an existing oil field that we may be able to inject the CO2 into? Yeah, right. We don't have one. Coal isn't a very bright idea - "clean" or otherwise. There is nothing clean about coal with its CO2 emissions, sulphur, soot, and radioactive residues.

See also :

1. Climate expert urges dropping clean coal
2. Coal can't be clean : leading Australian scientist
3. China overtakes US as world's biggest CO2 emitter
4. Singapore : Tuas Power may build $2 billion coal-fired plant

(2008-05-21 10:25:13 SGT) [Energy] Permalink

Pioneer to end plasma display panel production

news.com :

Pioneer plans to end production of plasma display panels as part of a restructuring program to return its operations to profit, it said Tuesday [13 May 2008]. The lower profits were largely a result of deeper losses in the consumer electronics business, where sales of PDP televisions dropped in North America and Europe. The company will end basic panel production at two factories in Japan by March 2009. In their place the company will buy panels from Panasonic and use those to make PDP TVs under a provisional agreement. As part of the deal some of Pioneer's plasma display panel know-how will be transferred to Panasonic.

The PDP TV sector has been hit in recent years by increasing competition from the rival LCD (liquid crystal display) technology. In the past PDP had a cost advantage at large screen sizes of around 42-inches and greater but the price of LCD TVs has come down with advances in production. As a result there is a much fiercer battle going on in the market and Pioneer has been hit by that competition. Pioneer plans to enter the LCD TV business in Europe from August, initially by selling televisions produced by Sharp.

- There had been talk of a comeback of sorts for plasma displays but it now looks like the marketplace has decisively spoken : LCD's are in, plasma's are out. Looking back, both technologies have come a long way. The first plasma display I used was an orange monochrome plasma-based touch-screen at a military wargaming centre. I'd suppose it was considered the height of technological advancement at the time. The first LCD display I had was one of those Game & Watch handheld games, an early precursor to today's Sony PSP's and Nintendo DS Lite gaming platforms. A long way indeed.

LCD is king of the hill now but there is always room for improvement - better LED-based backlighting is starting to hit the market, 100Hz displays for flicker-free movement (I wonder what took them so long), improved contrast ratios, wider colour ranges, and built-in digital TV tuners to receive broadcast HD content. And waiting patiently in the wings is OLED, a quantum leap over 10 years in the making.

(2008-05-21 00:01:01 SGT) [Tech] Permalink

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