For months, pundits have focused on rising production, mostly from US shales, sluggish demand, primarily from European stagnation and disappointing Chinese activity, aided by conspiratorial Saudi/OPEC intentions. And there is no doubt that some of this is true…last year, today, and probably over the near term. The underlying oil (physical) picture stands, roughly, at 91 …
Progress – and Challenges After some critical commentary about the program‘s progress, numerous reports have issued in recent days, proclaiming and analyzing the dramatic success of the first “commercial” gas development from China’s potentially huge shale reserves (estimated to be the world’s largest). In brief, Sinopoc (CNPC) has been producing from 21 “demonstration” wells …
Coals to Newcastle? Finally Nuclear? A Solar Revival? … but where’s the Policy?? Over the past decade, the United Arab Emirates (UAE) was the most visible proponent of renewable energy in the region, with plans for a Zero Energy City (Masdar), largely funded by one of the country’s leading sovereign wealth funds. Intentions included integrated …
Still Trial and Error! Unconventional resource leaders believe that traditional petroleum geophysics, developed over 150 years, needs a makeover to most effectively exploit shale/tight reservoirs. The behavior of hydrocarbons in extremely low porosity rock may require an understanding of hydrocarbon, water, and rock surface behavior at a near atomic level – much like the difference …
One of the better presentations at the MIT Water Summit last month focussed on the upper bound of water costs – energy-intensive desalination which, at up to $0.65/cubic meter (a quarter of a cent per gallon), define the high end of the value of water resource at a level which was surprisingly low relative to, …
It Gets Worse!! Everybody knows about the regional energy/geopolitical enigmas – subsidized energy, power, and water driving wasteful consumption. Add the forced addition of subsidized oil-fired power as cheaply valued associated gas production tops out. Mix in the usual conflicting politics where each country has its own reason not to ‘play well with others,” and …
My Journey – A Progress Report Now that I have just a little more time (but less than you think!), I’ve been trying to understand both sides of the Climate Change/Global Warming “debate” (although many view the debate as over), including the how to think about the economic costs/risks. My goal is to find …
Subsidy Reversals Continue – What’s Next?? When you want more of something (solar in 2000-2005), you subsidize it. When you want less of something (Spain, 2009+, Germany?), you eliminate this incentives and, eventually, the subsidies “go negative.” After a decade of outsized subsidies (and despite substantial efforts to reduce in line with improved relative economics), …
….and Where Natural Gas Goes, Coal Can follow (but when??)! If you believe in higher gas prices, it might be worth the effort to revisit future coal fundamentals. After a horrible few years (stocks down 70-90%), it’s extremely difficult to find a coal bull. However: 1) Natural gas, at $4.50, is, for most power generators, …
Light at the End of a L-O-O-N-G Tunnel??? Cold weather aside, the multi-year outlook for US natural gas supply looks fairly glutted, leading to a “BTU Bargain” as far as the eye can see. Even off the bottom, the 2015-2020 futures trade, between $4-4.50 per million BTUs – about a quarter of energy parity with …