When coal liquefaction breaks down coal to form a fuel oil, it removes many of the toxins such as mercury, sulfur and heavy metals. But, the process does nothing to reduce carbon dioxide, the emission that is thought to cause global warming. And in a typical coal-to-liquids plant, about 40 percent of the energy is lost in the conversion process.

Beyond that, those plants are capital intensive and have lots of technical and economic risks associated with them. Developers generally have been reluctant to plunk down their cash; if oil prices should drop, the incentive to use alternative fuel forms goes way down.

"If economic, these fuels could contribute to reducing our dependence on oil imports and significantly contribute to the Nation's energy security," says Clarence Miller, director of clean coal fuels for the U.S. Department of Energy.

My comments:

• Forty percent loss of energy in the process is not good, of course.
• The increase in CO2 content will be enormous. If global warming is real the effort we are making to reduce CO2 will be for naught.
• The cost  of the producing oil from coal could be very high and render it out of reach as a oil substitute.
• Since coal can be of used for chemical products such as plastics, etc. it might be well to conserve it for that process.

This leads me to believe that nuclear is still the best process to get energy because it does not offer chemical options and it can supply an infinite about of energy.

What do you all think?

 As gas prices exceed $3 a gallon, it's time to open ANWR

By Gretchen Randall
 
Date: April 21, 2006
 
Issue: As Americans are being hit with $3 to $4 a gallon gas prices, it is time for Congress to pass a provision to open the Arctic National Wildlife Refuge (ANWR) to oil and gas exploration.  Demand is high because of growth in India and China; supply is down because of the switch to summer formulation gasoline in the U.S. while many refineries are shut for maintenance. As Earth Day is celebrated tomorrow, it is time for our representatives to lessen our dependence on foreign sources of oil— particularly those that are hostile to the U.S.

 Here are some facts about ANWR:

 ANWR totals 19.5 million acres — eight million are already designated Wilderness.  Only a small portion of the coastal plain, approximately 2000 acres, would be used for oil development (one-hundredth of a percent of the entire 19.5 million acre area.)
 

ˆ The U.S. Geological Survey estimates that between 5.7 and 16 billion barrels of oil are under the coastal plain of ANWR. Opening just 2000 acres of ANWR to exploration is estimated to yield enough oil to replace 30 years of Saudi imports. 

ˆ New jobs would be created by opening ANWR—estimates by the unions are from 222,000 to 700,000.  

ˆ Since exploration began on the neighboring North Slope and the Alaska pipeline was built in the 1970s, the porcupine caribou herd has increased from 3000 to 30,000.  Polar bears like to walk on the pipeline to keep their feet warm.

ˆ A study by the Energy Information Agency (EIA) found that domestic oil production in ANWR could begin in 2013.  It also found that expenditures on foreign oil would decline by an average of $8 billion per year after production begins.

     According to the U.S. Fish and Wildlife Service (FWS), which manages federal wildlife refuges, eleven refuges have active oil and gas production on them. Those refuges which currently have oil or gas production on them are: Hewitt Lake (MT), Lake Thibadeau (MT), Kirtland's Warbler (MI), Hagerman (TX), Atchafalaya (LA), Anahuac (TX), Lacassine (LA), San Bernard (TX), Delta (LA), Crosby Wetland Management District (ND), Sabine (LA). To find out more about them go to www.fws.gov/refuges <http://www.fws.gov/refuges>

Contact: Gretchen Randall
Winningreen LLC
3712 N. Broadway – PMB 279
Chicago, IL 60613
Phone: 773-857-5086
e-mail: grandall@winningreen.com

It looks as if we could get the bulk of our oil from Russia some day in the future. This could be good or bad. Who can tell what the future holds if we get the bulk of our oil from Russia?  It is not good to send out money overseas on a continuous basis. This is for the economist the determine . What do you all think?

 Once a foe, Russia may be poised to become the United States' most reliable energy partner. Producing close to 9 million barrels a day of oil, production there could soon surpass that of Saudi Arabia, which produces 9.5 billion barrels of oil a day.

Russia may have lost the Cold War but it's out to regain respect by leveraging its oil and gas reserves. Its 350 billion barrels of such reserves are the world's largest and President Vladimir Putin wants to use those resources to bring his country into the modern world and to increase its influence on global concerns. With war and political turmoil plaguing the Middle East, Russia and some other nations of the former Soviet Union have become increasingly luring as a source for oil and gas. And in those areas, more than half the reserves remain untapped.

Russia may have lost the Cold War but it's out to regain respect by leveraging its oil and gas reserves. Its 350 billion barrels of such reserves are the world's largest and President Vladimir Putin wants to use those resources to bring his country into the modern world and to increase its influence on global concerns. With war and political turmoil plaguing the Middle East, Russia and some other nations of the former Soviet Union have become increasingly luring as a source for oil and gas. And in those areas, more than half the reserves remain untapped.

"Today, with oil more than $60 a barrel, the returns are above normal," says David Zaiken, CEO of Siberian Energy, which is a U.S.-based company with all of its assets in Russia. "That's why the Russian government can spend enough money to support increased production." Zaiken, whose publicly-traded exploration company is expected to own 1.3 million acres in Western Siberia and begin drilling in the coming months, says that Russia is geared up to increase production to 11 million barrels a day.

In a CNBC TV interview with Boone Pickens, a noted expert in the world oil situation, said the totality of the world's oil producers can pump 84 million barrels of oil per day. But he pointed out that with world's consumption is approaching 87 million barrels per day. Based on this fact he said the worlds  oil prices in the next six months should be very interesting.

What is the prognoses that the world can plump more oil to keep up with the growing demand? It is not good for two basic reasons:

• Oil  analysis predict that the oil discovery rate has reached its peak and we are on the down side of the bell shaped curve. We are now pumping more oil than is being discovered.

• Oil  can only be pumped at a set maximum rate from existing wells.  It takes time for the oil to permeate though the various sand and individual underground pools.

We are obviously in the twilight zone of the oil age. In other words we are beginning to run out of oil.

Latest information from the Department of Energy as to why the cost of gasoline is so high.

Why are gasoline prices so high?

• Even before the storm, gasoline and diesel prices were high as a result of tight crude oil supplies and increased global demand for transportation fuels.

• The rapid pace of global economic growth, particularly in China and the U.S., has led to exceptionally high global demand for oil, increasing prices for oil in the world market.

• As a result of the hurricane, nearly all oil and natural gas production facilities in the Gulf of Mexico had to be evacuated and shut down. Crude oil import facilities in the Gulf stopped receiving oil supplies from overseas, and many refineries were shut down.

• In addition, the pipelines that carry gasoline from the Gulf Coast refineries were affected by the power outages caused by the hurricane. DOE has been working around the clock with oil and power companies and the Department of Transportation to restore power to these refineries in order to get fuel supplies to consumers.

• All of these impacts to our energy infrastructure restricted supply of fuels at a time when demand for fuels surged as a result of the disaster response. The end result is even higher prices than before.

What are you doing about price gouging?

News Release - New York Times

China's, India's appetites for oil stir West's concern

THREAT SEEN TO ENERGY SUPPLY. ENVIRONMENT.

India has Joined China in a ravenous thirst for oil that now has the world's two most populous nations bidding up energy prices and racing against each other and global energy companies in an increasingly naked grab at oil and natural gas fields around the world.

Energy economists in the West cannot help admiring the success of both China and India in kindling their industrialization furnaces. But they also cannot  help worrying about what the effect will be on energy supplies as the 37 percent of the world's population that lives in these two countries rushes to catch up with Europe, the United States, and Japan.  Environmentalists worry about the effects on global warming from the two nations' plans to burn more fossil fuel.

We are probably already too late to enact the nuclear - hydrogen economy to head off an extreme world shortage of the oil. Also there is no global warming associated with nuclear power. When will the environmentalists get the message?

In all probability oil will strongly influence our national economic situation.

A recent headline in the New York Times.

Rising prices fuel 3.3% inflation in '04.

The consumer price index, the best known measure of inflation in the United States, rose 3.3% last year, the largest increase since 2000, the government reported.

The higher inflation rate was the result of a surge in oil prices early this year.

There is always a cry from the environmentalists for more efficient autos.

When Al Gore proposed the 80 mile per gallon auto, he was told by the engineering community that the only hope to approach that mileage was to use Diesel engines. The environmentalists immediately rejected that measure. They cannot have it both ways, but they will always call for more efficient autos.

Hybrids may help, but they only get significantly higher mileage during city driving. On the highway the savings are not as great since there are no stops and starts to save gasoline by turning off the engines while waiting at stop lights. Time will tell about hybrids, but a little more efficiency is not the long term answer. Where does it end? Everyone going around un a golf cart like vehicle. However, unless every one drives them it is more dangerous to be in one.

We will never achieve oil independence.

David O'Rielly, the Chief Executive Officer (CEO) of Chevron Oil Company was interviewed by Charley Rose on TV station KQED. Charley asked Mr. O'Rielly when will we will achieve oil independence from Mideast oil suppliers? Never was his reply. Saudi Arabia alone supplies nine million barrels per day to the US. We cannot over come this deficit. Our only hope is to reduce this deficit.

Mr. O'Rielly said we should open ANWR in Alaska to get some relief. But he did not hold much hope due to the strong resistance from the environmentalists and their constitutions in congress. This in view of the fact that the ANWR area is very small and drilling would not be intrusive to the environment nor affect the   Caribou herds. Mr. O'Rielly said that we previously pumped two million barrels per day from Alaska, but now only one million barrels. ANWR could give us some relief from the Mideast oil deficit.

The question of China was discussed. Mr. O'Rielly said that China was a net exporter of oil, but now is a net importer, and the demand is growing rapidly.

The Question of hydrogen came up. Mr. O'Rielly said that general Motors and others are rapidly developing fuel cells to run on hydrogen.  But he said that the hydrogen supply is only achieved by getting it from fossil fuels such as natural gas. I was taken back by this statement. Is it possible that the CEO of a major oil company has not heard about the action under way to get hydrogen from nuclear power plants?

Robert Redford thinks we can take care of our oil dependence by tougher fuel economy standards.

Actor, director and conservationist Robert Redford has been a member of NRDC's board for 30 years. Recently, he sent a message urging Americans to protest President Bush's plan to open the Arctic National Wildlife Refuge to massive oil development. Redford urges Americans to call on their senators and representative to vote against any bill that would plunder the Arctic Refuge for oil company profits, and instead to support tougher fuel economy standards and other measures that would reduce our country's dangerous reliance on Persian Gulf oil.

As Ronald Reagan would say 'Here we go again." Drilling in a few acres would plunder Alaska and make profits for the oil companies? I wonder if Robert gets any money for acting in his movies? Does Robert drive around town in a golf cart or ride a bicycle?

History Shows that we do not conserve over time.

The U. S. Department of Energy's Energy Information Administration (EIA)  reports that vehicle petroleum consumption continues to increase for the following reasons:

1. There is a continued increase on the number of vehicles on the road.

2. Americans are driving more.

3. Light trucks sales have increased more than any other vehicles and trucks are not subject to mileage reduction requirements.

4. There is an increase in vehicle horse power and weight.

Because of these reasons, Americans have cancelled out any gains in fuel savings over the past 30 years. Moreover, this is a free country. Are we to issue by fiat that we will all drive golf cart like vehicles and take public transportation where possible?

What is the current world Oil Situation?  Will it last forever? Read on it, is a finite resource.

Although the price of oil will probably stay below 75 $/barrel for a few more years its price is becoming rather volatile as the worlds need for oil approaches the worlds production capability. Most of the world's large, economically viable oil fields have already been found and have been put into production. As this resource is used and the production rates drop the ever increasing world wide demand for oil will be impossible to meet by pumping crude oil out of the ground. A permanent oil shock will be upon us. The question is not whether, but when will world wide oil production start to decline? When it does it will usher in a permanent oil shock that will lead to significantly higher production costs as more expensive alternative energy sources are utilized.

The latest exploration technology utilizes 3-D digital seismic methods. This technology was introduced about the same time as the Iran-Iraq War and the accompanying 1980 oil price had surged to $40/barrel. The world wide exploration boom that followed focused its efforts on oil reserves that were outside the Persian Gulf region. Unfortunately, despite intense efforts by all the world's oil companies, only a few new fields have been found and no new major oil fields (those producing 7 to 25 billion barrels) have been found since 1980.

According to the U.S. Geological Survey, global discovery of large new oil fields peaked in 1962 and has been declining since. The reason is simple: Most oil occurs in a few very large fields and these are usually discovered early on. The largest 1 percent of the oil fields contains 75% of all the discovered oil, and the largest 3 percent contain 94% of the oil. The implication of this skewed distribution is that as exploration progresses, the average size of newly discovered fields decreases. In other words, exploration in the declining phase of oil development is a vastly different game. Thus, it becomes more and more difficult to maintain a given production level.

The production rate from the lower 48 states provides an example of this phenomena in that during most of this century, U.S. production rose steadily as large oil fields were discovered. Over time, older fields reached their peak, and newly discovered oil fields were used to offset some of the production losses. As production from older fields begins an inevitable decline, technologies such as water flooding and gas injection have been introduced to slow the rate of depletion, but there is no reversing the trend. In the U.S. oil production from the lower 48 states peaked in 1970 at 3.5 billion barrels per year. This decline occurred even though drilling within the U.S. quadrupled after the 1974 oil shock. The production rate from this region has fallen by 44% since 1973. Fortunately due to successful off shore development, world wide oil production capacity still exceeds the world wide demand, least at this point in time.

Although few people deny that there will eventually be a world wide decline in oil production, the key question is when will it occur? An indication that trouble lies just around the corner can be found in the International Energy Agency's (IEA) World Energy Outlook 1995. In this report, IEA projects that by the year 2010, world petroleum demand will be 35 to 39% greater than in 1994 reflecting growth of about 2 percent per year. To meet this demand, IEA assumes that production from countries outside the Organization of Petroleum Exporting Countries (OPEC) will rise by 3% to 18% of the total by 2010. OPEC production would have to increase from 27 million barrels per day to about 48 million barrels per day. It is doubtful that OPEC can meet a demand that is 50% greater than OPEC's historical peak set back in 1977.

 A second indication that an oil supply problem may occur around the year 2010 is provided by Figures 1 and 2. Figure 1 provides a historical overview of the rate which oil has been discovered. The peak year was 1962. Since then, the global discovery rate has dropped sharply to a value that is now less than 15% of the peak year (1962). By the year 2010 the world's population is expected to reach 7 Billion compared with 3 Billion in 1962, with a corresponding increase in demand for crude oil that will be amplified as Nations such as China, Korea, and India industrialize and become serious competitors for available supplies. A permanent global oil shortage can be expected to begin when the world's total usage to date exceeds the quantity of oil under the oil discovery curve. As Figure 2 shows, this can be expected to occur around the year 2010 if the production rates from older wells declines as expected, or as early as 2000 if a key producer has a serious political problem that interferes with production.

Figure 1

World Oil Discovery Rate, 1912-1992