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September 27, 2005
WB: Blessed No More
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The media are a bit quiet about how much oil infrastructure was damaged by the two hurricanes. For Bush to call for short term lowering of consumption and to open up the strategic reserve he must be concerned.
The Rigzone reports quite some damage:
Rita may have landed at Sabine Pass as a category 3 hurricane but she plowed through Gulf of Mexico offshore oilfields at a Category 5 level knocking down jackjup rigs and setting deepwater floating rigs adrift.
As storm generated seas rose to meet the US Gulf continental shelf drilling rigs and fixed production platforms were severely damaged and in some cases sunk. The Rowan Companies jackup fleet appears to have taken a hard hit from Rita. The hull of the Rowan Louisiana was found
aground on the Louisiana coastline. The Halifax and Odessa were moved off of their drilling locations sustaining undetermined damages and the Rowan Fort Worth is still off the radar screen. The four rigs were drilling under contracts providing Rowan revenues of $210,000 per day. Early reports suggest that Global SantaFe may have lost jackup rigs GSF Adriatic VII and GSF High Island III. The two missing jackup rigs are insured for a total of $125 million. One of Hercules Offshore’s jackup rigs, Hercules 21, is listing precariously at Main Pass Block 21.
Deepwater rigs in the Green Canyon area due South of Houma, Louisiana, had to deal with Rita generated 155 mph winds and 60 foot seas. From early field reports it is clear that some did not fare so well. Noble Drilling’s semi-submersible rig Max Smith was dealt a one-two punch, first hit by Hurricane Rita and then by Chevron’s Typhoon. The rig was under contract to BHP at Green Canyon 238 when she was blown off location and straight into Chevron’s Tension Leg Platform named (irony upon irony) ” Typhoon”. The collision broke the Tension Leg Platform cables setting the “Typhoon” lose and ultimately capsizing the TLP. A fixed wing aerial survey on Sunday located the Max Smith in the West Cameron Area and Chevron’s Typhoon floating upside-down in Eugene Island Block 273 some 80 miles from their original locations.
The short term problem might be gasoline (and how does the strategic reserve help here?), the bigger medium term problem will be households paying for natural gas (or electrity from nat gas) during the heating period.
George Monbiot has a good one on peak oil:
It’s better to cry wolf now than to wait until the oil has run out
I have now read 4,000 pages of reports on global oil supply, and I know less about it than I did before I started. The only firm conclusion I have reached is that the people sitting on the world’s reserves are liars.
…
Last week Chris Vernon of the organisation PowerSwitch published figures showing that while total global oil production has risen since 2000, the production of light sweet crude – the kind that is easiest to refine into motor fuels – has fallen, by 2m barrels a day. This grade, he claims, has already peaked. The refinery crisis results partly from this constraint: there aren’t enough plants capable of processing the heavier grades.
And next in the queue? Who knows? All I can say is that George Bush himself does not appear to share the US Geological Survey’s optimism. “In terms of world supply,” he said in March, “I think if you look at all the statistics, demand is outracing supply, and supplies are getting tight.” What has he seen that we haven’t?
…
“The North American natural gas market is set for the longest period of sustained high prices in its history, even adjusting for inflation … Gas production in the United States (excluding Alaska) now appears to be in permanent decline.”
“The bottom line,” Hirsch says, “is that no one knows with certainty when world oil production will reach a peak, but geologists have no doubt that it will happen.” Our hopes of a soft landing rest on just two propositions: that the oil producers’ figures are correct, and that governments act before they have to. I hope that reassures you.
Commander Creep should set an example for saving energy by reducing his useless, wasteful, and completely uneccessary, almost daily trips to the Gulf and stay in Washington. And I’ll save energy by turning my TV off whenever he comes on.
Posted by: hellofaparty | Sep 27 2005 11:32 utc | 3
Just reading Ken Deffeyes “BEYOND PEAK OIL”. Its an update on the Hubbert’s Peak analysis. He is a oil geologist and claims no expertise outside of is vast knowledge of oil geology & the oil industry. To him its all a matter of math at this point, Hubbert was dead on in his 1958 forecast (US production peaked in 1973), and it would appear in 1969 forecast of global production peak was also accurate (he said it would be about the year 2000). Ken says its happening right about now.
The point underneath this is that the peak is not ‘the end’ but the halfway point of total cumlative production – consupmtion is another thing entirely as is price. The key he belives is to prepare now for a long weave decline in availability – consumption just rearranges the slope of the curve and the price.
I think this is why the big oil companies are quite smart and more focused on consildation and share then building new refineries that take years to build and 50 to 100 year paybacks. They don’t think there will be enough product to refine.
Posted by: dc | Sep 27 2005 12:11 utc | 4
Put another way, we still have 50% of the world’s oil left,
not counting Canadian tar sands which adds another 50%, and
not including coal oil and methane ethanol, which adds 150%.
Right now though, that 50% left is the “bottom ends”, sour
heavy crude, which is why BushCo pushed for low-sulfur fuels,
so US consumers would pay up front for the refiners upgrades.
So good news, there’s plenty of carbon left to sink the world,
at least the low-lying portions of it, but for right now, we
have stank, low-octane gasoline at indefinitely rising prices.
The solution is to invade Iran and Venezuala, and cut China off.
(kidding, Mr. Zhaoxing)
The solution is to import European (Japanese) small diesel cars.
We drove a zippy little mini-SUV diesel that got 56 mpg in Belgium.
I think it was a Fiat, marketed by Toyota, but they can’t import it
into the US because of our arcane EPA import:export regulations.
Put another way, if there really is free trade, there’s no peak oil.
Posted by: tante aime | Sep 27 2005 14:37 utc | 5
I should add a sarcastic little twist for Billmon.
Those BushCo low-sulfur regulations and high prices
for diesel? The refiners decided it was easier to
hedge sweet light futures than to invest in plant,
so what you’re seeing now, is the result of them
lining their pockets (energy stocks up 87% YOY),
instead of investing gouged profits in production.
There’s plenty of sound desulfurization technology.
With Katrina and Rita hitting their bottom line, B.O.
is looking at several years to catch up production,
with little cash or economic incentive to renovate.
It’s not Peak Oil … it’s Big Oil. See Peakoil.net,
with your tongue firmly planted in your cheek. They
are trying to spook the markets, as much as tell-all.
Bottom line, you can’t do anything about it except
drive less, drive smaller and drive EU diesel.
Posted by: tante aime | Sep 27 2005 14:45 utc | 6
To help our national government that I am the head of, we can lead by curtailing inspector generals inessential traveling by car, the president explains examples of how the govt will lead in conserving. We don’t need IEs, our inspector generals, getting in the way of important recovery and rebuilding down there. There’s no need for that posing for the cameras game. We will also lead the way by economizing by the IEs, 500 already actualized, good matrics, use of inessential e-mail to save on electric power. Beveridge and entertainment budgets will not be effected especially in Baptist districts.
Posted by: christofay | Sep 27 2005 20:30 utc | 7
Put another way, we still have 50% of the world’s oil left, not counting Canadian tar sands which adds another 50%, and not including coal oil and methane ethanol, which adds 150%.
What you mean “we”, paleface? Last I heard, Canada wasn’t part of the United States, nor did any other country recognise America’s God-given right to suck away their resources.
You want anything from the rest of the world, you pay for it. And if we don’t wanna sell it, we won’t. And if you don’t like it – nuclear weapons are becoming easier and easier to get hold of. And Iraq shows the limits of the use of force to secure resources.
There’s a cold wind blowing through the world, and the excess of fat on your American bones aren’t going to be much insulation anymore.
Posted by: Phoenician in a time of Romans | Sep 27 2005 22:41 utc | 8
phoenician…..we have nuke silos under hockey arenas and grain elevators. we are also considering joining OPEC and burning the free trade agreements the US won’t live up to. don’t even get me startedon hydroelectricity and fresh water.
Posted by: lenin’s ghost | Sep 28 2005 1:34 utc | 9
“What you mean “we”, paleface? Last I heard, Canada wasn’t part of the United States, nor did any other country recognise America’s God-given right to suck away their resources.”
In 1962 the US sent a spy into Canada to overturn a government that was not favourable to the US. While I support your defiance, I don’t share your optimism.
http://www.peace.ca/regimechangeincanada.htm
Posted by: edwin | Sep 28 2005 2:11 utc | 10
ya know, I still want an explanation of recent events in Canada where at least one Crown energy company, maybe more, was sold to an American energy combine without a popular referendum or (afaik) any vote at all. can any Canadians explain this to the rest of us?
I can’t address that directly, DeA- but I read just last week on my fave quick catch up on the Pirates in Action in Canada site that under NAFTA Canada has to supply US w/oil, even if their own needs arenot covered. There could be some horse trading going on around that. If you’ve noticed, Pirates are seriously hollowing out Canada – medical system, CBC…building reactionary & theocratic institutions & training grounds to groom more little monsters…all moving quite quickly in preparation for merger.
Posted by: jj | Sep 28 2005 3:40 utc | 12
Pheonician, on my last trip into Canada
to visit your(?) great strip clubs, I
was so drunk on your R&R coming back,
I flashed the Mountie my credit card.
“Good evening, sir, have a nice day!”
Hail Canada, don’t get me wrong, but
for all its natural resources, Canada
is a cold place in hell w/o US trade,
and an aging population on the dole,
and that’s from Canadian’s talking.
Posted by: Gar Longebah | Sep 28 2005 4:52 utc | 13