Jason Barton

Professional Information and Energy News

Archive for the ‘Petroleum’ Category

EPA Proposes Increased Bureaucracy

without comments

Is this proposed legislation going to improve working conditions or environmental impact at sugarcane and ethanol production facilities, or is it just more paperwork? I’ve written extensively on this site and in my doctoral dissertation about these issues, as well double fuel pumpsas related policies, but it’s not clear the intent of the proposed legislation. Whatever it is, demand for imported ethanol has taken various swings over the last few years, not due to natural factors, but due to the EPA’s decisions.

When the US EPA allowed Brazilian sugarcane ethanol to meet the “advanced biofuels” requirement in 2010, it certified, according to their analysis, that cane ethanol reduces greenhouse gas (GHG) emissions by at least 50% (61%) over traditional, petroleum gasoline. This comes after much debate regarding the actual GHG emissions from sugarcane, corn, and cellulosic ethanol.

When the EPA made their decision on this debate, it significantly increased demand for Brazilian cane ethanol as US refiners worked to meet the advanced biofuel mandate. The EPA, however, lowered the volume on this mandate due to lagging development of domestic, cellulosic ethanol that would also satisfy the advanced mandate.

Now, according to the article below, that increased demand could be dampened, and the number of producers reduced to only the largest players, as meeting the new reporting requirements increases transactions costs. Policy fluctuations like these have made it very difficult for investors in Brazil since the prices they earn for their product are not subject to natural factors of supply and demand, but due to the whims of bureaucrats in Washington.

Reuters

 

 

 

By Cezary Podkul

NEW YORK, July 12 | Fri Jul 12, 2013 10:13pm BST

 

(Reuters) – Importing cheap Brazilian ethanol into the United States could become much less profitable next year if a proposal by the Environmental Protection Agency to expand tough documentation and transportation rules to non-U.S. producers takes effect.

The proposal, made on June 14, could seriously disrupt a signature Latin American energy trade, triggering auditing, documentation and transportation requirements, including physically separating U.S. ethanol imports from each other until those requirements are met.

Read the entire article here.

 

 

Study to Compare Impacts of Diesel and Biodiesel Emissionson on Human Health

without comments

The impacts of ethanol fuel use on air quality in Brazil have been studied without conclusive results, so the results of this study comparing emissions from diesel fuel and biodiesel will be interesting. Other researchers have found that the burning of sugarcane prior to harvest has had adverse effects on human health, but the effect of gasoline combustion versus ethanol combustion remain largely undetermined, so studying the combustion in mines, a much more closed environment, should yield interesting results. Stay tuned…

U of A Wins ‘Underground’ Biodiesel Grant

Posted by – October 18th, 2012

The National Institute for Occupational Safety and Health awarded a $1.4 million grant to the University of Arizona‘s Mel and Enid Zumerman College of Public Health along with the department of mining and geological engineering. The three-year project will compare exposure and health effects of miners using diesel versus biodiesel fueled underground mining equipment. During the past few years, miners have shifted to the use of biodiesel-blend fuels in an effort to reduce exposure to particulates from engine exhaust.

Continue reading this story here.

Written by Jason

October 20th, 2012 at 8:25 am

Obama and the New Brazil

without comments

After a first visit to Brazil earlier in the 20th Century, a foreign diplomat boldly stated that “Brazil is the country of the future!” Self-deprecating Brazilians quickly added, “And it always will be.”

Based on my four years of living in Brazil and many return visits in the four years since, I don’t think Brazilians are saying this any longer, nor are the popular media or President Obama.

It has been fascinating to watch the changes in Brazil since my first arrival shortly before Lula’s election in 2002. I feel very fortunate to have earned the job that first brought me there, and to have stayed in close contact with the amazing colleagues and friends with whom I worked and laughed during the past decade.

Mr. Obama, Meet the New Brazil

By JULIA SWEIG and MATIAS SPEKTOR
Published: March 18, 2011

When Barack Obama lands in Brazil this weekend, he will find a country transformed. In little more than a decade, some 30 million people have been lifted out of poverty and the country has risen to seventh place in the world economy.

Change at home has revolutionized policies abroad. Brazil has woken up to the 10 states along its borders, becoming the eminent power and driver of regional integration in South America. It has set out to develop closer ties simultaneously with Israel, Syria and Iran.

[…]

With most of the Amazon within its borders, the world’s 10th largest oil stores, and nearly a fifth of the world’s fresh water, Brazil is an environmental power, an energy power, and guarantor of global food security.

Read the entire article here.

Efficiency, Innovation, Natural Gas are Keys to Energy Security

without comments

Former Presidents Bush and Clinton are walking a fine line, balancing between taking advantage of the cost effective resources we have now, such as oil and gas, and the need to protect our energy security and natural environment for generations to come.

Two former presidents share many energy views

By JENNIFER A. DLOUHY and TOM FOWLER
HOUSTON CHRONICLE

March 12, 2011, 2:28AM

Oil will be essential for fueling the U.S. for decades to come, but low-emission natural gas and improved efficiency will bridge the transition to cleaner alternative fuels, business leaders, two former presidents and energy analysts said Friday.

Former President George W. Bush told a packed ballroom of energy executives at the CERAWeek conference that while the U.S. has a vision of new technologies to power our homes and propel our cars, the nation needs to be prosperous to afford them. And that prosperity, Bush said, is tied to oil and natural gas.

Although they have been political adversaries, Bush and former President Bill Clinton agreed that the U.S. should do more to harness the promise of natural gas, which produces fewer emissions than coal and oil.

[…]

But he cautioned that the nation needs to make sure that the hydraulic fracturing process, used to unlock vast stores of gas in shale formations, doesn’t contaminate drinking water supplies or create an accident that shuts down the industry the way last year’s Gulf of Mexico oil spill stopped most offshore drilling.

[…]

‘We’ve got to take action’

Big energy consumers said they are scrambling to offset spikes in crude prices and eke out more per barrel by boosting efficiency.

Read the entire article here.

Obama Pursues a Moderate, Pragmatic Approach During Energy Woes

without comments

Of course times are tough. I tend to drive my car until the gas light comes on so I have to fill up less often, but then kick myself for driving so much as I watch the cost climb past $40 a tank. These are minor pains compared to the ones some folks are feeling, but even this light irritation is enough to make me want a fast change to whatever it is we’re doing, or not doing, in terms of making energy more affordable.

Patience is key. Jumping in to more drilling without taking the time to make sure it’s safe and efficient could cause as many problems, and increase total costs, as much as launching scads of new and often inefficient wind or solar projects.

Energy is expensive. Our government has helped it to be artificially cheap since early in the last century. This has lead to great advantages in our country, such as the great access most people in the U.S. have to everyday conveniences such as lights, heat, cars, buses, and airplanes. In most countries these aren’t nearly as accessible to people on, say, the bottom half of the socio-economic strata.

As Obama weathers the criticism from the right that we need to expand our use of fossil fuels, and from the left that more needs to be done to move us to alternative forms of energy, I hope that he and Secretary Chu continue their pragmatic approach, leaving the door open to more fossil fuels so long as they are safe, while also encouraging innovation and investment in alternatives.

More fence sitting, I know, but I believe this middle path is the best one.*

Obama Faces Bipartisan Criticism on Energy Policies

By Jim Angle

Published March 05, 2011

Sen. Mary Landrieu, D-La. and Senate Republican leader Mitch McConnell are questioning the Obama administration's energy policies and arguing more should be done to develop domestic sources of energy. (AP)

Sen. Mary Landrieu, D-La. and Senate Republican leader Mitch McConnell are questioning the Obama administration’s energy policies and arguing more should be done to develop domestic sources of energy. (AP)

With energy prices rising in part because of turmoil in the Middle East, lawmakers from both parties are questioning the Obama administration’s energy policies and arguing more should be done to develop domestic sources of energy.

“I don’t think the president’s position on oil and gas is as strong as it should be,” said Democratic Sen. Mary Landrieu of Louisiana, where the oil industry plays a large role in the local economy. “Oil and gas is an important industry in the United States today and it will be in the next decades.”

Many in the administration emphasize alternative forms of energy and some, including the president, have openly talked of the need for higher prices on oil and coal to make alternatives such as wind and solar more price-competitive.

Read the entire article here.

* I hope my post is fair and balanced. Not like the Fox version, but truly fair and truly balanced.

Petroleum’s Centrality, Volatility, Damage World Economies

without comments

Processes such as innovation and competition are vital to enhancing world economies, but both of these are stifled in the world of petroleum. Either a place has oil, or it doesn’t, so there’s little place for either one.

True, there can be innovation in terms of the technology used to extract oil from hard to reach places such as the tar sands of Alberta or the floor of the Gulf of Mexico. But this is nothing like the innovation that is taking place in the competition to produce technologies that provide domestic, renewable, cost effective energy.

The article below highlights the pitfalls of our economies’ current dependence on an energy resource that is so subject to the swings we saw in 2008, when oil went from over $140 per barrel in August to only $40 in December. Petroleum’s centrality, its concentration in few places, such as North Africa and the Middle East, are further problems that should continue motivating us to find ways to reduce this reliance on a non-renewable resource.

Oil and the economy

The 2011 oil shock

More of a threat to the world economy than investors seem to think

Mar 3rd 2011 | From The Economist print edition

THE price of oil has had an unnerving ability to blow up the world economy, and the Middle East has often provided the spark. The Arab oil embargo of 1973, the Iranian revolution in 1978-79 and Saddam Hussein’s invasion of Kuwait in 1990 are all painful reminders of how the region’s combustible mix of geopolitics and geology can wreak havoc. With protests cascading across Arabia, is the world in for another oil shock?

[…]

Even without a disruption to supply, prices are under pressure from a second source: the gradual dwindling of spare capacity. With the world economy growing strongly, oil demand is far outpacing increases in readily available supply. So any jitters from the Middle East will accelerate and exaggerate a price rise that was already on the way.

[…]

By contrast, the biggest risk in the emerging world is inaction. Dearer oil will stoke inflation, especially through higher food prices—and food still accounts for a large part of people’s spending in countries like China, Brazil and India. True, central banks have been raising interest rates, but they have tended to be tardy. Monetary conditions are still too loose, and inflation expectations have risen.

Read the entire article here.

BP Chief Says Brazilian Ethanol is Best Bet to Replace Petroleum

with one comment

There is definitely substantial agricultural land for much more fuel, fiber, and food production in Brazil, as well as preservation of forests and even reforestation, but the headline seems quite an overstatement of the facts.

My PhD research has investigated the potential for Brazil to supply enough ethanol for the U.S. Renewable Fuel Standards, which may have renewables accounting for as much as 20% of our transportation fuels in 2022. There does appear to be sufficient arable land for both Brazilian demand as well as to supply the U.S. for these renewable mandates signed into law by George Bush in 2007.

To say there is enough land to replace all petroleum globally, however, especially considering the booming demand in China and India as their economies expand and have more people driving cars, is a stretch, to say the least.

Between the typos, the outdated photo, and the lack of background research for the article below, I’m wondering where to send my resume for a job at the Telegraph.

Brazilian ethanol is the best hope for replacing oil, says BP’s Bob Dudley

Ethanol derived from Brazilian sugar-cane offers the best hope of replacing oil as the world’s main source of fuel when it runs out, according to Bob Dudley, BP’s chief executive.

Brazilian ethanol is the best hope for replacing oil, says BP's Bob Dudley

By Robin Yapp, in Sao Paulo 7:03PM GMT 13 Feb 2011

He said Brazilian ethanol is the “best type of renewable energy” and offers the possibility of an “ultrapotent fuel that could revolutionise the market”.

“The alcohol extracted from sugar cane is cheaper, less polluting and more efficient than that from corn, for example, produced in the US.

BP is channelling its research into renewable fuels accordingly, with 40pc of its $1bn (£625m) annual spend in this area targeted at Brazilian ethanol, Mr Dudley told the weekly Brazilian news magazine Veja.

“There will obviously a time when the oil runs out and with this prospect on the horizon, we will use more renewable energy sources,” he said.

Read the entire article here.

Written by Jason

February 17th, 2011 at 9:55 pm

Congressional Republicans Move in Two Directions at Once

without comments

Neither of these effort is close to certain, but we are seeing one prominent Senator, Dick Lugar (R-IN), possibly moving towards federal renewable energy standards, while another group is seeking to gut the President’s ability to implement the same.

These aren’t necessarily contradictory, as the efforts could lead to similar results with less power held in the White House.

Sen. Lugar is drafting a bill that could include standards increasing vehicle efficiency, renewable electricity, waste-to-energy, and other measures throughout our energy matrix.

Meanwhile, in the article from Politico below, congressional Republicans would greatly reduce the President’s ability to mandate clean energy or climate change measures through the White House or the EPA. I like the decentralization of power they are working towards, but do see some value in letting the President use those tools that have traditionally been at his disposal.

It will be interesting to see if either or both efforts is successful, and if Obama attempts to fight it by replacing Carol Browner, or concedes the point and dissolves her office.

It’s still a fascinating time to be alive.

Sen. Lugar Prepping Bill That Could Include ‘Clean Energy’ Standard

By KATIE HOWELL AND JEAN CHEMNICK of Greenwire
Published: February 11, 2011

Republican Sen. Richard Lugar is crafting broad energy legislation that could include a “clean energy” mandate similar to the one President Obama called for in his State of the Union address.

The Indiana Republican this week said his bill, which is still “weeks away,” could include a clean energy standard as well as “energy efficiency in many, many facets.”

Read this entire article here.

CR would slash EPA, White House energy office

By ROBIN BRAVENDER & PATRICK REIS & DAN BERMAN | 2/11/11 8:46 PM EST

House Republicans threw down the gauntlet at the Obama administration’s energy and environmental agenda Friday night, proposing to defund the White House energy adviser’s office and block EPA from regulating greenhouse gas emissions.

In addition to slashing the Environmental Protection Agency’s budget by $3 billion – nearly twice as much as they originally proposed – GOP lawmakers included language in the continuing resolution to strip the agency of its ability to implement climate change rules.

Read this entire article here.

Patience, Efficiency Are Key to Safe, Profitable Use of Brazil’s Oil

without comments

There are a lot of people with a lot to gain from drilling this “presal” oil off Brazil’s coast as quickly as possible. I have worked with some of them and understand their desire to move forward with the extraction now, not later. I also understand their many good intentions as well as their confidence that the oil can be extracted safely using existing technology, even if I don’t agree.

I can also attest, from personal experience, to the truth of the article’s contention that government bureaucracy will be as inefficient at getting the job done as it will be at distributing any public funds to Brazilians and much needed government services. The barrier however, is not the Brazilian government, but existing technology.

And yes, prices at the pump are rising with no sign of abating, but it’s hard to see how speeding this oil drilling ahead in the next few years will do much to ease those prices in anything but the longest term. Plus, oil is a great example for supply creating its own demand. Increase the supply of oil and the lowered prices will drive us to use enough gasoline, diesel, and jet fuel to keep demand and prices high.

The first paragraph in the article below describes a process that is every bit as difficult, and as dangerous, as the one employed for the Deepwater Horizon platform formerly situated in the Gulf of Mexico. These processes and others like them can be and have been done safely, though recent experience tells us that not only is this safety far from ensured, but also that if something goes wrong, the consequences remind us exactly what the word “disaster” means.

The pressure to drill now is exacerbated by the high current demand for oil in the face of growing constraints. Some are reluctant to continue drilling off U.S. shores while the people and economies of Louisiana and other Gulf states are still reeling from last summer’s spill. Regardless of your political stripe, Middle East politics make us all a bit uneasy, especially when we think of how much of our oil comes from despotic and unstable regimes there.

Slowing our demand for oil, first by increasing efficiency and reducing use of transportation fuels, and then by continuing to develop viable alternatives to petroleum, will decrease the drive to rush drilling in places like the oil fields over 7000m beneath the ocean’s surface, through 3000m of rock and another 2000m of salt.

Given time, companies such as Petrobras will certainly improve technologies so that this oil can be reached more safely, with more effective failsafes in the event something does go wrong, and likely it will all be doable at lower costs, to the companies doing the drilling and to the consumer.

The additional time will also allow Brazil to continue eliminating corruption and streamlining its bureaucracy so that the permitting process is more efficient, as are the avenues through which the government spends its revenues and improves infrastructure.

These factors combine to create win-win-win situations for people, profit, and ecological health. Patience and efficiency are key.

Brazil’s offshore oil

In deep waters

Extracting the black gold buried beneath the South Atlantic will be hard. Spending the profits wisely will be harder

Feb 3rd 2011 | CIDADE DE ANGRA DOS REIS | From The Economist print edition

THE coast of Rio de Janeiro is 290km and 70 minutes away as the helicopter flies. High overhead, gas is flaring; underfoot, enough oil to fill 330,000 barrels is waiting to be offloaded. The ocean floor is 2,150 metres beneath. Drill past 3,000 metres of rock and you will hit a layer of salt 2,140m thick. Only after boring through that fossilised ocean will you strike oil—6.5 billion barrels’ worth in the “Lula” field alone. (Supposedly, it is named for the Portuguese word for squid, not the former president called Lula for his curly hair.)

[…]

More hopeful is the prospect that technological progress, led by Petrobras, can diversify Brazil’s economy. The company employs more than 1,600 people in research and development, says Carlos Fraga, who leads these efforts. It also works with 85 Brazilian universities and research institutes, and for every one of its own researchers, another ten outside the company are working on its projects full-time. A technology cluster is springing up around Petrobras’s research labs in Rio, with university facilities alongside new $50m laboratories built by the likes of General Electric and Schlumberger.

From this perspective, the technical obstacles of sub-salt drilling look like an opportunity. Exploiting offshore oil, says Mr Fraga, could spur Brazilian innovation just as the space race did in the United States. “Just extracting the oil is not enough to move Brazil on in technological development,” says Segen Estefan of the Federal University of Rio de Janeiro. “These are finite resources. Brazil must seize the moment to lead in technology, not just in extracting and exporting raw materials.”

Read the entire article here.

Confusion on the Future of Energy

without comments

Well this article is puzzling. The first paragraph is tongue in cheek (I hope), and yet it has some important and accurate points, as well as some dubious ones.

Gilbert seems to be making some sort of a comment on the proceedings in Davos, but it’s not clear what his comment is, or even if he knows very much about the energy issues he’s discussing. Bloomberg is a trusted media channel, but there appears to be little to trust in Mr. Gilbert’s article.

No, oil disasters are not good. I get the point that when one happens we tend to pay more attention to safety, but it shouldn’t take that. I also get the sarcasm, but would appreciate some clarity.

Yes, our appetite for energy does threaten to compete with food and water. Biofuels can compete with food not only when we divert corn or sugar from food to fuel, but also when we divert land used for food to produce non-food crops such as grasses for cellulosic ethanol, though there are definitely ways to avoid having to make this Hobson’s choice. I’ve written about the validity and exaggeration of the competition between these two at other times, so will leave it for now, but you can read more here if you like.

Traditional fuels such as natural gas and petroleum can also stress our water supplies. Read more about water used in the tar sands for petroleum here, or about natural gas and the potential impacts of fracking on water here.

So it’s tough to know from that first paragraph what Gilbert’s take is on the developments n Davos.

He continues to obfuscate the situation further in the paragraphs that follow.

He goes on to talk about China and their use of coal, proposing they use more hydro power (see paragraph excerpted below). I wonder if Mr. Gilbert is familiar with the Three Gorges Dam. It’s not a small project.

Yes, China will use a lot of coal as they grow their economy in the coming decades, but they are also doing an admirable job of investing in and implementing renewable energy. Read more about that here.

Next is nuclear energy.  Gilbert seems to deride it, but, again, it’s unclear. He mentions the possible security concern, which is a very credible threat, since the technology used for plants such as breeder reactors brings more use and awareness of  the technology used in nuclear weapons. Risky, but potentially worth it since nuclear power can bring energy to disenfranchised people who are at risk of being wooed by terrorist organizations. We can put political or religious faces on the fights, but they are most often between the haves and the have-nots, and helping more people to be haves reduces the motivation to attack. It’s also a nice thing to do, reducing the number of have-nots, just on moral grounds.

Back to energy, Gilbert moves on to biofuels, grossly over-simplifying the issue I touched on above. Yes, the competition with energy can raise food prices, but if energy supplies are constricted, because of dwindling supplies of non-renewable energy resources or geopolitical events in the Middle East or any number of other issues, food prices will rise as well. In fact, the rise in food prices we saw in 2008 had less to do with biofuels than it did with petroleum prices (See Abbot, Hurt, and Tyner, 2009).

It takes energy to fertilize, irrigate, process, package, and transport our food, so if we resign ourselves to the current, non-renewable energy matrix, those ever-decreasing supplies will continue leading to ever-increasing food prices. Diversifying our energy matrix, prudently over time, will help to mitigate if not eliminate this threat. Bread wars could come much more easily from rising energy prices than rising energy prices could be caused by biofuels.

So, thank you, Mr. Gilbert, for giving us all of this food for thought.

Green-Energy Future Looks Black as Recession Bites: Davos Diary

By Mark Gilbert – Jan 26, 2011 6:07 AM MT
Gilbert

The future is black, not green. Get used to oil trading at $100 a barrel. Drilling disasters are good because they focus the oil industry’s attention on safety. Oh, and our insatiable thirst for yet more energy sources threatens to deplete the world’s food and water supplies.

That’s the bleak message from the World Economic Forum’s opening discussion on global energy at its annual meeting in Davos, Switzerland. Fatih Birol, the chief economist of the International Energy Agency, led a panel that delivered a somber outlook for renewable energy.

[…]

Hydropower, for example, would be a great way to meet China’s future needs, especially during demand peaks in the morning and early evening, because you can switch on water- generated supply in eight minutes, whereas coal takes 32 hours to come on line, while a nuclear power reactor takes 56 hours. The problem is the huge capital-expenditure cost because the hydropower plants are typically far away from where the electricity is needed, demanding transmission networks.

[…]

The gloomiest aspect of the energy debate is the impact on agriculture. As governments champion the use of biofuels, diverting agricultural resources to producing energy raises food prices. That’s a worrying trend for those of us who reckon food and water security will be the world’s most pressing issue in the coming years.

Read the entire article here.