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By Robert Rapier on Apr 5, 2010 with 62 responses

Answering Questions on New Zealand

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I am horribly swamped at the moment. I won’t go into the details, but suffice to say that I have some writing commitments that have all come due at about the same time. So I don’t have much time to blog at the moment. On the plus side, I finally did my taxes this weekend. In more than 20 years of doing my taxes, this is the first time I completed them as late as April. I normally have them completed by the first week of February. That is just an indication of how backed up things are.

But I thought I would just throw something quick out there. I have gotten a number of questions about what I was doing in New Zealand. I even had the media contact me when I was down there. As it is my nature not to hype things, I have been largely silent about the things we are working on. I was also largely silent with the media. Call it the anti-Range strategy if you will: Keep expectations manageable, and talk only when necessary.

I honestly didn’t even think I had given the media enough information to do a story, but I was e-mailed the following over the weekend:

Wood waste could be key to keeping us green

The story vaguely details what we were doing down there. In a nutshell, we are looking for locations where specific renewable technologies can compete on the basis of the technology merits, and not the subsidies. New Zealand has some very attractive features, and we were just scouting out the logistics, local technologies, etc.

Too early to tell what we will decide to do. I have put my technology report together, and I think I have a grasp of the opportunities and challenges. Incidentally, I was to go back down in a couple of weeks and present at the EECA Biofuels and Electric Vehicles Conference 2010 – and had told some people I would catch up with them there – but after reviewing my overloaded schedule I decided I better pass on that right now.

If you are interested in my impressions of New Zealand, I put up a short entry on my travel blog. Given that I have added New Zealand and India, I probably need to change the name of the blog, which is currently Traveling in Europe.

  1. By paul-n on April 5, 2010 at 9:12 pm

    RR, I absolutely commend the “anti Range” strategy, more work, less hype is always a good approach – I wish you success there. Lots of biomass resources, though certainly not everywhere. I always thought that if anywhere would be the place for an “electricity to liquid fuel” project, it would be the south island, though they use it to make and export aluminium instead (I worked at the smelter for a year and half).

    For the same reason, a biomass to liquids process makes sense there, electricity is cheap and fuel expensive. In Hawaii you have exactly the opposite – I can;t think of anywhere else I have been where elec is so expensive compared to fuel. Given that Hawaii still uses petroleum for electricity, a biomass to electricity operation seems to be more appropriate there.

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  2. By Nigel Taptiklis on April 6, 2010 at 6:13 am

    RR: Post deleted at Nigels’ request. Was intended to be a private e-mail.

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  3. By paul-n on April 6, 2010 at 8:13 pm

    OD, that does sound extremely odd, as those projects certainly don;t get done as prices go lower. As prices get higher, access to capital will shrink, for the wider economy, but not usually for the oil industry. However, I have heard numerous comments to the effect that a shortage of capital will be the limiting factor, not oil prices. But if the price is going to stay high enough, long enough, someone will put up the capex. Also, what capex is available may decide to chase lower risk onshore of Gulf of Mexico stuff first.

    There is certainly more to it than just the price of oil…

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  4. By rufus on April 6, 2010 at 8:32 pm

    Exxon-Mobil (you know, that oil company that made $45.2 BILLION pre-tax profit last year)

    Paid NO U.S. Income Tax last year.

    Don’t those ethanol-haters keep telling us how many kazillions of dollars the oil companies pay in taxes? We’re Suckers.

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  5. By rufus on April 6, 2010 at 8:33 pm

    Oh, here’s a linky-poo.

    http://e85vehicles.com/e85/ind…..l#msg24095

    Or, you can look it up on Forbes.

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  6. By paul-n on April 6, 2010 at 8:41 pm

    Benny,

     

    You are spot on about methanol, it is a great alternative fuel.  This has been known for some decades, and the US government (and military) has done lots of research into it.   A methanol economy would be great.  Instead we have ethanol, you only need to look at any of Rufus’ posts to see why – the powerful corn/farmers lobby.

    Methanol has 48% energy by mass compared to gasoline, that, and the fact it is more corrosive than gasoline, are it’s only downsides.  

    The benefits of methanol fuel/engines are that they

    • can tolerate small (or large) amounts of water in the fuel
    • do not need winter and summer grade fuel
    • can run much higher compression (20:1), 
    • burn cleaner, and at lower temperatures, leading to longer engine life
    • can be mixed with gasoline at any ratio (though not in high compression engines)
    • much safer in the event of a fire.

    Indycars used methanol for decades, until being forced to switch to ethanol.  

    The high compression engines can get diesel like efficiency on methanol.  They can also run equally as efficiently on natural gas.  This is my version of a flex fuel vehicle – methanol and NG.  A small NG tank that you can fill up from home each night and use for your daily driving (equivalent to PHEV, only more fuel efficient) and for cold weather starting, and then methanol for long trips or if you run out of NG.

    Methanol at$1.10 is equivalent to gasoline at $2.29, and today gasoline on NYMEX is $2.34, so it’s line ball.  If you have a dedicated methanol engine though (30+% efficiency), then you would need gasoline at $2.00 or less to be even, and I don;t think we’ll see gasoline down there again.

    And, methanol is produced from NG, of which the US has growing reserves, and can be made from landfill gas and any biomass, though not as cheaply as NG.

    This is something Alaska should be looking at.  They have huge amounts of stranded NG, and they could do a methanol plant up north, and then pipe the stuff south, along the existing pipeline route, instead of spending $25bn to build the NG pipeline.

    Finally, if the USof A got seriously into methanol cars, it could then export the technology to other parts of the world!

     

    It would also work well in a place like NZ, but I don’t think RR’s company is into methanol, so that probably wasn’t one of their discussions.

    It would be a great result, but that doesn’t seem to have been the criteria for government decision making on alternate fuels.  Maybe we’ll see RR write an essay on methanol soon…

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  7. By Jim Takchess on April 6, 2010 at 6:38 am

    I thought you might of been checking out some of the NZ algae groups that tends to generate a lot of PR releases

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  8. By Wendell Mercantile on April 6, 2010 at 9:40 am

    Call it the anti-Range strategy if you will: Keep expectations manageable, and talk only when necessary.

    Good plan. Always let people be pleasantly surprised when you deliver more than you promised.

    If you promise more than you deliver, people will be disappointed, even if the final product in both cases is exactly the same.

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  9. By Benny BND Cole on April 6, 2010 at 12:49 pm

    The PHEV, powered by bio-fuels when range extension is needed, always strikes me as an option that can take us decades into the future. We can also make liquid fuel from natural gas (methanol).
    Fascinating options ahead.

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  10. By paul-n on April 6, 2010 at 1:19 pm

     We can also make liquid fuel from natural gas (methanol).


    Benny, NZ has already done that.  There is a plant there (owned by Canadian company Methanex, the world’s largest methanol producer) that makes methanol from natural gas.  They had a second plant, built in 1980, to make synthetic gasoline from the methanol, then using the Mobil process.  It was a 14,000 bpd plant, and ran for over a decade (I believe) and was finally closed as oil was just too cheap.   The methanol plant carries on to this day. 

    While it may be economic, at today’s oil prices to restart the methanol to gasoline plant, I am a proponent of using methanol directly as fuel, rather than the expense of further conversion to gasoline.  You can do M10 no problem, and the flex fuel vehicles can probably run M100, or should be able to.

    Indeed, lots of options ahead, when people don’t think everything has to be turned into oil or ethanol…

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  11. By od on April 6, 2010 at 2:03 pm

    Sort of off topic, but I read a comment the other day that has my anxiety level extremely high.

    Basically it was stated that as oil prices go up, many oil projects will be canceled and a lot of this oil we are finding in deep sea will never be drilled. If that is true, that will really make the other side of peak oil a cliff and not a rolling hill. What he said totally contradicts what I have always read about certain projects not being profitable until oil was high enough. Can anyone offer some clarification?

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  12. By Benny BND Cole on April 6, 2010 at 3:03 pm

    Paul-

    Methanex lists the price of methanol at $1.10 a gallon. http://www.methanex.com/produc…..price.html

    Even given the current lack of economies of scale that would develop with larger build-outs, I would say methanol is price-competive right now.
    Methanol, if memory serves, has about half the BTUs of gasoline, so, obviously, $1.10 works out to about $2.20 a gallon BTU wise.
    You gotta add on taxes (but not if we decided not to tax domestically produced methanol).

    Again, with large-scale build-outs, the cost per unit could drop.

    A PHEV-methanol car is a viable option, one that would take us off completely from oil, and radically curtail total liquid fuel demand. It would clean city air, and radically reduce imports of oil.

    I cannot imagine a better result for the USA.

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  13. By od on April 6, 2010 at 8:50 pm

    Thanks for clarifying Paul.

    Their reasoning was as oil prices go up the price of everything goes up which makes many projects on the books become unprofitable. The record profits the oil companies have been making with high oil prices should have qued me in that it was probably false. I’m also old enough to remember all the lays offs in the oil biz in the 80s and 90s due to low prices, can’t have it both ways. I have just never heard an argument put forth with that reasoning, and it took me off guard and tapped the doomer in me lol. Your points about capital make sense and could definitely be an issue in the coming decade(s) especially if the economy is still on the cliff, as many seem to think.

    Peak oil is definitely my anxiety inducer. Oh how I wish I could go to sleep for 20/30 years and wake up when the dust has hopefully settled.

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  14. By Benny BND Cole on April 6, 2010 at 8:55 pm

    Option A: A high-compression PHEV.  Use the battery for in-town commutes, and go methanol on longer hauls. And pay the equivalent of $2 a gallon while cleaning city air and cutting oil imports.

     

    Option B: Or, we could invade Iraqistan and spend several trillion dollars, while paying trillions to oil thugs who finance the terrorists we say we are fighting.

     

    Abbot and Costello could explain this, maybe. Laurel and Hardy?  The Three Stooges? The Philadelphia Philly?  Bart Simpson?

     

    The problem is, I can’t come up with anybody dumb enough to chose option B.

     

     

     

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  15. By rrapier on April 6, 2010 at 9:08 pm

    Rufus, I am sure you saw the update to the Exxon story:

    Forbes has updated its article to include a statement from Exxon: “Though Exxon’s financial statement’s don’t show any net income tax liability owed to Uncle Sam, a company spokesman insists that once its final tax bill is figured, Exxon will owe a ‘substantial 2009 tax liability.’ How substantial? ‘That’s not something we’re required to disclose, nor do we.’”

    At the end of the day, money earned by Exxon in the U.S. should be taxable by the U.S. Money earned overseas is subject to overseas taxes. Of course Exxon earns the vast majority of their money overseas.

    RR

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  16. By rufus on April 6, 2010 at 9:29 pm

    Well, that’s wonderful. Then, I think I’ll let the “Overseas” folks buy Exxon’s product, and I’ll buy my fuel from local,” U.S. tax-paying” farmers, and Biorefineries.

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  17. By rufus on April 6, 2010 at 9:39 pm

    With methanol you’re still using a finite fossil fuel. Second, nat gas is cheap, now, but how long will it be cheap when you’re using it for transportation fuel on top of its other uses?

    On top of all that, it’s more corrosive than ethanol, and has about 20% less btu content.

    Methanol’s probably not going anywhere, especially with $2.00 cellulosic coming online.

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  18. By Benny BND Cole on April 6, 2010 at 11:36 pm

    RR-

    In general, I do not subscribe to the “big oil companies are bad guys” school of reasoning. In general, they produce a product we buy of our own volition. It is a useful product, and improves our standard of living.

    On the other hand, I have interviewed accountants with what used to be called the “Big 5.” They were completely above-board in describing accounting mechanisms that shifted profits or income to whatever country or province or rule offered the lowest tax rate, or allowed computing the lowest possible taxes. Of course, it is not illegal to minimize tax bills.

    With the advent of the multi-national corporation, profits and income become incredibly elusive for tax-collectors. Not coincidentally, the corporate income tax has become a shrinking portion of total U.S. federal tax revenues.

    At this point, I think nation-states have to throw in the towel, and move towards consumption taxes, that can be more easily monitored. Gasoline taxes and retail taxes can be more accurately applied. Regressivity is a concern, but perhaps can be mitigated by no sales taxes on necessities such as food. Luxury taxes always strike me as a dandy idea, as well as elimination of the home mortgage income tax deduction on second homes or homes that cost more than $1 million.

    But I do not wonder that Exxon has found a away to dodge US taxes. If they make a huge profit, do not be surprised to find it is funneled through the Isle of Man via a holding company in the Cayman Islands. Or that huge expenses are incurred by a contractor based in Portugal, which is a holding company owned by mysterious entities, mostly LLCs with undisclosed ownership.

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  19. By rufus on April 6, 2010 at 11:54 pm

    Or, just tax them on their SEC filings, and be done with it. If they want to pay double by paying again in another country that’s their business. That money would find its way “home” in a hurry.

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  20. By Paul N on April 7, 2010 at 2:50 am

    Benny, wConsumption taxes are great, they are very hard to avoid/minimise etc, but the gov only collects it when money is spent, inside the country. If Exxon can keep the money in Caymans or wherever, without bringing it into the US, then it never gets spent here, and no tax is collected.

    Consumption tax is really a good adjunct to income tax. You set the consumption tax on everything except food (groceries, not restaurant meals), and then have a lower or flat income tax rate (with a tax free threshold) and very few, if any, deductions. Hong Kong, Russia, and many of the former Soviet countries have done this . They actually have a simple tax system that everyone can understand, is very hard to game/avoid – what a concept!

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  21. By paul-n on April 7, 2010 at 3:11 am

    Rufus said:

    With methanol you’re still using a finite fossil fuel. Second, nat gas is cheap, now, but how long will it be cheap when you’re using it for transportation fuel on top of its other uses?

    On top of all that, it’s more corrosive than ethanol, and has about 20% less btu content.

    Methanol’s probably not going anywhere, especially with $2.00 cellulosic coming online.


    Well, Rufus, you already know that you can make methanol from cellulose – in fact you can make it from the lignin too, so it is no more tied to nat gas than ethanol is to corn starch.  It’s just that with ethanol, you don;t have an (easy) way to make it from NG, otherwise they would!  Now, a really good idea would be to make methanol from the corn stover, and use the corn itself for food – what a concept!

    Yes, it is more corrosive , but any flex fuel vehicle can handle it.

    That said, your final statement, is unfortunately, probably true, as the ethanol industry has out lobbied the methanol industry, by some margin.  It would be interesting though, if the mandate was for an ethanol OR methanol blend, and the credit applied to both (all adjusted for btu content, of course).  I wouldn;t be surprised to see the oil companies opt for methanol (except Valero, who have already bought their ethanol plants).

    Of course, the natural gas saved on not making nitrogen fertiliser for corn, and distilling ethanol, would make quite a bit of methanol.

     

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  22. By rufus on April 7, 2010 at 3:49 am

    Google Inbicon. They’re producing ethanol from wheat straw in Denmark. It makes it easier to understand Poet’s Project Liberty. Evidently, you get a whole lotta lignin from the cellulosic process. Also, they get a fair amount of molasses for animal feed.

    Project Liberty will produce 25 Million Gallons of ethanol, and enough lignin to power that process plus a 100 Million Gallon/Yr corn ethanol facility. Some facilities, like Inbicon, will build Electrical Power Stations in conjunction with the ethanol facility. Abengoa is doing this in Kansas, I believe.

    It’s looking like fermentation is going to be the way to go. It’s going to be Ethanol.

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  23. By rufus on April 7, 2010 at 3:59 am

    Paul, the ethanol refinery of the future will use very, very little nat gas. Your corn ethanol refinery will have an accompanying cob ethanol refinery that will produce enough lignin to run both operations.

    That’s the whole essence of Poet’s initiative.

    The question has always been, can they get the price down enough, and can they get the farmers to supply the cobs? Novozymes, and Dupont have gotten the price down, and Poet is getting the cooperation of the farmers. Even with a horrible harvest season this year the cob harvest went off without a hitch.

    It’s looking like “the deal is done.”

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  24. By Kit P on April 7, 2010 at 9:24 am

    Rufus did I mention that I filled up
    with 10% ethanol in my 22 year old POS PU.

     

    I am very satisfied with the cost and
    environmental impact.. In the US, we are doing. I know why Indiana
    farmers grow corn and soybeans instead of sugar cane.

     

    I have not followed NZ very closely
    because they are not doing anything. It would be nice if RR does
    something to change that but I will be surprised. This has more to
    do with small population of NZ which is isolated but has abundant
    resources.

     

    There are lots of places that claim to
    be green. It is easy to be green when you do not have 80 million
    people in a country the size of a postage stamp.

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  25. By rufus on April 7, 2010 at 11:39 am

    I’ve had a hard spot in my heart for the Kiwis since the 70′s. While we were losing 50,000 young men in an effort to stem the tide of Communist aggression in Vietnam the Kiwis were banning our ships from their ports because we wouldn’t tell them which ones were “carrying nukes.” (We Never told anyone that.)

    I try to write it off as just a bunch of misguided hippie NZ politicians, but it still grates on me. Now, they’re pushing this nonsensical “Global Warming” horsehockey. I’m sure the people are “good folks,” but I, also, am not very interested in what they are doing, or will ever do, for that matter.

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  26. By rufus on April 7, 2010 at 11:48 am

    Kit, if your truck has Never run on E10, if it has Always run on straight Gas, the Ethanol could break a little sludge loose in your gas tank, and clog up your fuel filter. If in a couple of days you start to run a little rough, change the fuel filter. Do NOT do anything else until you change the fuel filter. Unfortunately, there are more than a couple opportunistic “mechanics” that will sell you a whole lot of totally unnecessary repairs while quietly slipping in a new ff. This is, actually, very unlikely, but it’s good to be aware.

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  27. By Kit P on April 7, 2010 at 12:45 pm

    Rufus, I have been running E10 for
    several years. It has more than 250k miles when I started using E10.
    The only problems I have had with my Ford Ranger has been
    electrical except for a pump pump leak. Starter & battery.

     

    Maybe I was too subtle. I am using
    renewable energy transportation fuel without needing to modify
    anything. Also use E10 in in a 2007 Corolla and 1993 Camry.

     

    I am careful with both fuel and oil. I
    have not worked on an ICE in years because modern engines run so well
    with just a little common sense. I do teach the kids to the basics.
    The youngest who is now learning to drive will change the plug on his
    car as a learning experience not because they need changing.

     

    Like wind and solar, I see no
    environmental befit for BEV. The flawed assumption that advocates
    have is that ICE and coal fired power plants are the same as during
    the Vietnam war. I would like to see the electricity generating
    capture a market share from BEV but I do not think it is ethical to
    promote something you would not buy yourself. So I support R&D
    for BEV so that the information is available to make future choices.

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  28. By paul-n on April 7, 2010 at 1:24 pm

    Rufus,  the Kiwis did not implement the nuclear free zone until 1984, long after Vietnam was over.  The main motivation for this was because of French nuclear testing at Mururoa Atoll, in the south Pacific, next to NZ’s Cook Islands.  The French thumbed their noses at all the S. Pacific countries, doing 40 atmospheric nuclear tests there, and then another 160 underground.  The French also sent a covert team that attacked and sank an NZ Greenpeace ship in Auckland harbour in 1985, killing two people, which ensured the nuclear free zone would become  permanent (by an act of parliament). I expect if that happened to a ship in Hawaii, the US would react somewhat more forcefully.

    This does not mean the Kiwis don’t like America, just not anything to do with nuclear weapons.  Aust, NZ and US formed the ANZUS defence agreement in 1951, and all through Vietnam, they co operated with US operations.  While you were doing your stuff in Vietnam, NZ (and Australia) were busy keeping the peace in the S. Pacific islands.  During that time there were urpisings/coups in the Solomon Islands, Fiji, New Guinea, etc etc.  Not as well known as Vietnam, and that’s they way they like to keep it.

    You might be interested to know that NZ (and Australia) had the first special forces on the ground in Afghanistan after Sep 11th – the SAS were there by Sep 12th. the NZ prime minister later got a personal thank you from GWB, and the NZ forces got a US Navy Presidential Citation in 2004. NZ troops have been in Afghanistan ever since, and are still there today, and will still be there next year too.

    In WW2, NZ lost more than twice the service men, as a portion of population, than did the US, and in WW1 it was ten times as many (though that was partly NZ’s fault for letting the Brits command their troops).

    So, a small country, yes, but I think it’s fair to say they punch above their weight on the world stage.

    They are serious about energy independence as they are long way from the places that have oil, and were cutoff before (WW2) and don’t really want to have that happen again.  Most of their pacific islands are low elevation atolls, so they have more than a passing interest in global warming.  They do not have the vast natural resources of the US, or even Australia, so they are quite creative on making the best of what they do have.  When you are a small country in a remote corner of the world, you have no choice.

    If you ever doubt their pride and commitment to their country, just watch the All Blacks in a rugby game at Eden Park (Auckland), or the memorial services on ANZAC day (April 25th, their version of Veteran’s day).  That said, they always stand up for their friends and allies, and that includes the US.

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  29. By rufus on April 7, 2010 at 2:11 pm

    Gotcha Kit. I figured that, but I just wasn’t sure.

    Paul, thanks for the info. I didn’t realize it was as late as 1984 that they started the “Nuke Free” stuff. I was busy trying to make a living, but I remember that it grated on me a lot. I’ve never quite gotten over it.

    As I said, I’m sure the Kiwis are great people, and I’ll try to keep what you wrote in mind. It’s just that every time I’ve seen the words “New Zealand” in the last forty years they’ve been associated with something that’s irritated me down to my core.

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  30. By paul-n on April 7, 2010 at 2:49 pm

    Rufus, I’m not sure what other things may have irritated you, but (having lived there), I really can’t fault them on their anti-nuke (and anti-French) stand.  The testing and nearby islands have been rendered uninhabitable, and there were clouds of stuff drifting around the S. Pacific after the atmospheric tests, and radiation leakage into the ocean (fishery) after the underground ones.   After the sinking of the ship in Auckland, they caught the French agents, and tried them.  Somehow, the French talked the NZ gov into letting them return to France to serve out their sentence there.  When they got back to France they were promptly released and celebrated (by the gov’t) as heroes!  Imagine if one of the 9-11 guys had survived, and then was allowed back to Saudi Arabia and you get the idea…

     

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  31. By rrapier on April 7, 2010 at 4:50 pm

    “Well, that’s wonderful. Then, I think I’ll let the “Overseas” folks buy Exxon’s product, and I’ll buy my fuel from local,” U.S. tax-paying” farmers, and Biorefineries.”

    You know I am not much for letting misinformation stand. Based on Exxon’s tax bill over the past few years, you and I both know that they will be hit with a hefty U.S. tax bill for 2009. FYI, their U.S. tax bill from 2004 through 2008 was almost $70 billion, which is certainly more than the entire ethanol industry has paid during their entire existence. So if you want to base your loyalty on who is paying U.S. taxes, ethanol is not going to win that argument against Exxon.

    Now, please don’t continue to put me in the position of defending Exxon. Try to keep the information factual. Propaganda is for lobbyists, and since you insist you are not one…

    RR

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  32. By Wendell Mercantile on April 7, 2010 at 5:07 pm

    Rufus said: I’ve had a hard spot in my heart for the Kiwis since the 70’s. While we were losing 50,000 young men in an effort to stem the tide of Communist aggression in Vietnam…

    Rufus~

    Did you know that New Zealand provided troops and aircraft to help us in Vietnam? They supplied both ground troops to fight with the Australians in a joint ANZAC force, and also provided pilots and Canberra bombers. Their commitment was much smaller than ours, but they were there with us.

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  33. By Among the cows in Io on April 7, 2010 at 5:10 pm

    Does this site allow HTML in comments? I suppose there’s one way to find out.

    I know why Indiana farmers grow corn and soybeans instead of sugar cane.

    So do I: sugar cane won’t grow in Indiana. Out of the entire USA it only grows in a few places like parts of Florida, and isn’t even competitive there.

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  34. By Kit P on April 7, 2010 at 7:15 pm

    Greenpeace is neither green nor
    peaceful. They are a bunch of terrorists. I own no weapons but if I
    has forewarning that Greenpeace was in the area I would be done at
    the hunting store buying a semi-automatic ‘deer’ rifle to protect my
    family.

     

    Only once have I loaded my flare gun
    under duress. A Canadian tall ship under motor was changing course
    and bearing down on my boat under sail. Maritime rules apply to the
    clueless and those who think their cause is jsut. If NZ harbored
    prates, that is an act of war.

     

    What I am suggesting is that their two
    sides to this issue.

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  35. By savro on April 7, 2010 at 7:39 pm

    Kit,

    Apparently, the Canadian Mounties are as afraid of Greenpeace as you are. Surprised Just saw this earlier today…

    http://ottawa.ctv.ca/servlet/a…..OttawaHome

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  36. By Kit P on April 7, 2010 at 10:49 pm

    Funny! Except our facilitates have
    armed guards, In Spain, they had uzis and attack dogs. I just think
    there is a better way to make political statements than blowing
    people up.

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  37. By rufus on April 8, 2010 at 12:16 am

    Try to keep the information factual

    I did. I stated a fact. Exxon paid no U.S. Income Taxes in 2009. I made no claims about what they may have, or may not have done in the past, or about what they might do in the future.

    Mercantile, I didn’t know that. I saw a few Aussies over there, and a few Koreans. Anyway, I’ll cut’em some slack from here on out. I hope they do well. I know the people are pretty ballsy, I’ll just keep my mouth shut about the government.

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  38. By paul-n on April 8, 2010 at 12:43 am

    Kit,

    The whatever your views on Greenpeace, and I have no time for them either, the vessel had never done any piracy acts, in fact it hadn’t even been anywhere near the French islands, yet, though they had announced their plan to go there, which is still not illegal.
    So then the French covert forces, with approval from then president Mitterrand, go to NZ and sink the ship? If this had happened in NY harbour, how then would/should the US react? Not lightly, I would expect.

    Harbouring pirates is indeed an act of war, but this was nothing of the sort. If the boat had been in French waters, well, the French can impose whatever rules they like. But attacking it while at harbour in a sovereign country – that is an act of war.

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  39. By rrapier on April 8, 2010 at 1:49 am

    I did. I stated a fact. Exxon paid no U.S. Income Taxes in 2009. I made no claims about what they may have, or may not have done in the past, or about what they might do in the future.

    Given that they won’t have yet filed taxes for 2009, then it is misinformation to make the claim. Your claim will still be hanging out there long after they pay their 2009 tax bill. What will stick in some minds – and I am certain this is your intent – is that Exxon got away with something in 2009. Or did you plan to retract in all the places you posted this once they do pay their 2009 tax bill? And how about the U.S. taxes they paid for 2004-2008 that I mentioned? You suggested you wanted to support companies that pay U.S. taxes. By all accounts, few have paid more than Exxon.

    But it has always been your nature to spread negative stories on oil companies – however flimsy the basis – while at the same time doing absurd contortions at times to defend ethanol companies.

    RR

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  40. By rufus on April 8, 2010 at 2:04 am

    No, no, no, RR. That ain’t how it works. A Corporation makes quarterly payments throughout the year. They pay a penalty, and interest on any underpayments of tax due.

    Remember, they didn’t pay any taxes in April of -09 for the year 08, either.

    BTW, you are aware that the API has joined the suit attempting to get part of the RFS2 set aside, right? Where have I ever done “absurd distortions” to defend ethanol companies? Any examples?

    That article told what Exxon paid in 09, and where they paid it. It Wasn’t in the USA. Look Robert, you can spin this until the cows come home, but in the year of our Lord 2009 Exxon-Mobile did not pay a cent of Income tax to the United States of America. They didn’t pay any “estimated tax,” and they didn’t pay any underestimation from 2008.

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  41. By rrapier on April 8, 2010 at 2:42 am

    Remember, they didn’t pay any taxes in April of -09 for the year 08, either.

    That’s a perfect example of what I am talking about. Did they or didn’t they end up with a hefty U.S. tax bill for 2008 when all was said and done? Yes, they did. I am curious, have you praised their hefty tax bills in the past? After all, they have paid some huge U.S. tax bills, and you support business that pay U.S. taxes. So can I read about your praise of Exxon’s previous tax bills?

    You should probably know as well that Forbes has retracted the story. I presume you will follow suit? Here is what Forbes had to say:

    Although I came up with that by reading the company’s annual 10-k filing with the SEC, ExxonMobil spokesman Alan Jeffers assures me that this is wrong, that Exxon did indeed pay substantial income taxes to the U.S. Treasury in 2009, and that it overpaid taxes in 2008.

    My mistake was in thinking that these figures somehow reflected actual tax benefits and liabilities. So what we should have written was that ExxonMobil “recorded” no U.S. income taxes for 2009 instead of “paid.” All you re-bloggers out there, please note the clarification. Mea culpa.

    BTW, you are aware that the API has joined the suit attempting to get part of the RFS2 set aside, right?

    That’s because the EPA couldn’t get their act together, and then decided to make the requirements retroactive.

    Where have I ever done “absurd distortions” to defend ethanol companies? Any examples?

    Come on. I could spend days on that. On the anti-oil side, I remember the lengths you would go to smear any researchers that had come up with negative ethanol conclusions with oil ties. I recall you did it on The Oil Drum at one point, I called you on it, you couldn’t back it up, but neither would you retract it.

    Then, on the pro-ethanol front, you always take press releases as fact, you exaggerate and take projections as fact (e.g. $2 cellulosic ethanol), you accept all pro-ethanol research, and you reject all anti-ethanol research.

    So let’s not play games. You and I both know the score, and it isn’t me that is spinning.

    RR

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  42. By Jim Takchess on April 8, 2010 at 6:44 am

    Why don’t you start a new thread in the forum to talk about Exxon ? unsure what this has to do with NZ and RR . Interesting info on NZ though in the comments.

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  43. By Kit P on April 8, 2010 at 8:22 am

    PaulN

     

    I believe in nonviolence and the rule
    of law. If you respect the rights of others and do your best to
    follow those rules; then you should have the expectation of the
    protection of the rule of law. Greenpeace should not have that
    expectation.

     

    Based on the conduct of Greenpeace, if
    a I saw a Greenpeace inflatable coming at my sailboat ; I would turn
    my boat and ram them. It is called the law of mass tonnage. While I
    might be included to toss them my spare anchor in stead of my life
    ring, I would render aid as required by law.

     

    The ‘rules’ require me me to maintain
    my course and speed. It is also impossible for my sail boat to hit a
    high inflatable following the rules.

     

    If you think I am being ridicules to
    think about such things; a Greenpeace rammed inflatable rammed a sail
    boat because it had the logo of my company one of many dangerous acts
    of violence against people at sea.

     

    Disabling a ship in port would appear
    to be the prudent action. If the ship was in NYC, the US Coast Guard
    would have done a safety inspection. I suspect the government of NZ
    was complicate.

     

    Of course, NZ is more than happy to let
    American sailors defend their right to exist while not allowing us to
    have a beer in their towns.

     

    Like Rufus, I have a hard spot for NZ
    but it is minor to compared to Jane Fonda and John Kerry. In any
    case, I would be civil with anyone from NZ, or Jane Fonda and John
    Kerry.

     

    Flying a green flag does not give your
    the right to comment acts of piracy and endanger others.

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  44. By rufus on April 8, 2010 at 8:26 am

    I quoted a Forbes article. If they have changed their story, then I retract my comment. How did their tax return not agree with their SEC filing? Do you have any sort of link on this? I’m not being argumentative. I really want to know how Forbes could have gotten this wrong (and how Exxon initially got it wrong, themselves, with their first comment. How much did they really pay in to the U.S. treasury?

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  45. By savro on April 8, 2010 at 8:36 am

    Rufus said:

    I quoted a Forbes article. If they have changed their story, then I retract my comment. How did their tax return not agree with their SEC filing? Do you have any sort of link on this? I’m not being argumentative. I really want to know how Forbes could have gotten this wrong (and how Exxon initially got it wrong, themselves, with their first comment. How much did they really pay in to the U.S. treasury?


     

    Rufus,

    Last night, RR pointed me to the following clarification article re: the Exxon tax story from Forbes.

    http://blogs.forbes.com/energy…..ome-taxes/

    Takchess is right though; for the good of the forum, stories that are way off topic like this one are better suited in a thread of their own created in the “Energy Discussion” section.

     

     

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  46. By rufus on April 8, 2010 at 9:55 am

    Sam, I just read your link, and all I can say is it raises more questions than it answers. I think someone is peeing on our legs, and telling us how warm the rain is. Anyway, I suppose you’re right, but, let’s face it, the NZ thread wasn’t exactly drawing a lot of comment. NZ isn’t really a “hot-button” issue, is it?

    Okay, back to whatever it was that RR did in NZ (was that ever mentioned?)

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  47. By savro on April 8, 2010 at 10:20 am

    Rufus said:

    Sam, I just read your link, and all I can say is it raises more questions than it answers. I think someone is peeing on our legs, and telling us how warm the rain is.


     

    The clarification article from Forbes definitely ends off with a number of open questions, but you can’t shy away from the fact that the initial claims (the ones you were tooting about on your bullhorn) seem to be misguided and have now been retracted.

     

    Anyway, I suppose you’re right, but, let’s face it, the NZ thread
    wasn’t exactly drawing a lot of comment. NZ isn’t really a “hot-button”
    issue, is it?

    Okay, back to whatever it was that RR did in NZ (was that ever
    mentioned?)

    Whoa! Didn’t we just settle on NZ not being the place that didn’t not refuse to support us in ‘Nam? Wink

    All kidding aside, the info posted by Paul N and someone else (Wendell Mercantile?) was actually quite an interesting history lesson. I enjoyed it very much.

    As far as the separate threads go, as you can see, there are no strict rules here and we’re definitely not interested in having to move posts and threads around in order to keep the discussions on topic, but we hope that memebers of the community will start new topic threads (in any of the “Energy Discussion” group of forums) on their own when they’re about to post something that is likely to go off on a tangent.

    It will be much easier to participate in multiple discussions if topics are organized and categorized as much as possible. It’s definitely a lot easier already to follow all of the discussions from RR’s essays by just looking at the forums for the newest posts and topics. Once things begin to pick up as we add more expert contributors, keeping things compartmentalized will be even more important.

     

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  48. By rufus on April 8, 2010 at 10:33 am

    “(the ones you were tooting about on your bullhorn) “

    Is that how you are going to characterize it whenever someone quotes a Forbes article critical of an Oil Company? If so, why not just name it “The Big Oil Blog,” and be done with it? At least everyone will know where they stand.

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  49. By russ on April 8, 2010 at 11:18 am

    Rufus, you bought a bill of goods that wasn’t what it said it was – that’s all. The author of the Forbes article hadn’t done adequate research before starting to type.

     

    Hardly ‘The Big Oil Blog’ because of that. 

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  50. By rufus on April 8, 2010 at 12:00 pm

    Did you even “read” my comment, Russ? I just want to know if I’ll be accused by the blog-owner of “Tooting my Bullhorn” if I post a comment based on a Major Business Publication article that’s not worshipful of Big Oil?

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  51. By rrapier on April 8, 2010 at 12:24 pm

    Rufus said:

    Did you even “read” my comment, Russ? I just want to know if I’ll be accused by the blog-owner of “Tooting my Bullhorn” if I post a comment based on a Major Business Publication article that’s not worshipful of Big Oil?


     

    Rufus, you can be as critical of Big Oil as you like, but the criticism needs to be accurate. You have long had a tendancy to run with anti Big Oil stories and push positive ethanol stories, and your criteria for credibility in each case are very different. What I would love to see is simply more objectivity out of you. When you say “I won’t support Exxon because they don’t pay U.S. taxes” and then you find out they do pay U.S. taxes, it looks like that really isn’t the reason you don’t want to support them. Otherwise, I would expect you to say “I now support Exxon because they pay U.S. taxes.” The fact is, you don’t support Exxon, and you saw this as an opportunity to get others not to support them. But a little skepticism on your part was warranted. If I saw an article that claimed that POET had never paid taxes, I can tell you that I would do a lot of checking before running with that.

     

    Frankly, I don’t care whether you support Exxon or not. (I try to support them as little as possible myself). I would just like to see your arguments become more objective and less like propaganda. I also want them to be accurate.

     

    RR

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  52. By savro on April 8, 2010 at 12:33 pm

    Rufus said:

    Did you even “read” my comment, Russ? I just want to know if I’ll be accused by the blog-owner of “Tooting my Bullhorn” if I post a comment based on a Major Business Publication article that’s not worshipful of Big Oil?


     

    Rufus,

    There’s no worshipping of “Big Oil” going on here. It’s a matter of sticking to the facts, even when it’s going against your will. Correct me if I’m wrong, but my impression is that you’re on the “opposing team” of Exxon and are rooting hard for the ethanol industry to one-up the big bad wolves.

    When you first started talking about the Exxon story I shared your concern 100%. But things changed onced the original story was retracted.

    The fact that you still didn’t back down gracefully (as did the author of the original blog post who made the initial claim
    against Exxon) from your original position only serves to make one more certain of the likelihood that you have an agenda here.

    Not that I have anything against agendas either; it’s nearly impossible not to have a slight agenda at the very least, but sometimes you need to draw a line and back down when the published “facts” you were using have been retracted.

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  53. By rufus on April 8, 2010 at 1:28 pm

    This was my 08:26 am comment:

    I quoted a Forbes article. If they have changed their story, then I retract my comment. How did their tax return not agree with their SEC filing? Do you have any sort of link on this? I’m not being argumentative. I really want to know how Forbes could have gotten this wrong (and how Exxon initially got it wrong, themselves, with their first comment. How much did they really pay in to the U.S. treasury?

    Then, you followed up with this:

    but you can’t shy away from the fact that the initial claims (the ones you were tooting about on your bullhorn) seem to be misguided and have now been retracted.

    Well, since you guys won’t let it rest, I recommend you go back and read that article, again. My takeaway is that he’s been forced to bow to Exxon’s obfuscation, temporarily, but I still don’t see any evidence that Exxon has actually Paid Anything. In fact, the only NUMBER I saw was where they are claiming a Fifty someodd million dollar “Credit.”

    Anyway, it still comes down to the question I raised earlier. What “Burden of Proof” is required now to post on this blog? If you can’t quote one of the top 3 Business Journels in the nation what the heck can you do?

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  54. By rufus on April 8, 2010 at 1:38 pm

    And, yes, as everyone is aware, I DO have an agenda. I am strongly Pro-Survival. And, my opinion is that in order for America to survive we need to be developing a replacement for oil, Now. I think Ethanol is a very good Replacement. Thus, I Am Strongly Pro-Ethanol.

    In my opinion, Big Oil has been fighting ethanol tooth-and-nail from the git-go. As a result of having this Opinion, I Am Very Anti-Big Oil.

    You notice I did not say I was Anti-Oil. That would be silly. We need oil, and we will need oil for, probably, a lot longer than we’ll have it. But, I am Anti-Exxon, Conoco, Shell, Koch, and all the others that would enslave me, and my family, to a rapidly depleting resource.

    So, There’s my Bias, and my Reasoning. I think some others should be so honest.

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  55. By savro on April 8, 2010 at 1:53 pm

    Rufus said:

    This was my 08:26 am comment:

    I quoted a Forbes article. If they have changed their story, then I retract my comment. How did their tax return not agree with their SEC filing? Do you have any sort of link on this? I’m not being argumentative. I really want to know how Forbes could have gotten this wrong (and how Exxon initially got it wrong, themselves, with their first comment. How much did they really pay in to the U.S. treasury?

    Then, you followed up with this:

    but you can’t shy away from the fact that the initial claims (the ones you were tooting about on your bullhorn) seem to be misguided and have now been retracted.


     

    That’s factually incorrect.

    Take a look back and you’ll see that my “tooting your bullhorn” statement was in response to your apparent refusal to back down even after the link was posted to the Forbes retraction (I didn’t chime in with an opinion on the matter until then), when you said: “Sam, I just read your link, and all I can say is it raises more

    questions than it answers. I think someone is peeing on our legs, and

    telling us how warm the rain is.

     

    Anyway, it still comes down to the question I raised earlier. What

    “Burden of Proof” is required now to post on this blog? If you can’t

    quote one of the top 3 Business Journels in the nation what the heck can

    you do?

    I didn’t have a problem with you quoting the Forbes piece until you decided to brush aside their very own follow-up retraction. In fact, I still don’t have a problem with you quoting what you choose to, but you certainly can’t expect to not get called out on it.

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  56. By savro on April 8, 2010 at 1:58 pm

    Rufus said:

    And, yes, as everyone is aware, I DO have an agenda. I am strongly Pro-Survival. And, my opinion is that in order for America to survive we need to be developing a replacement for oil, Now. I think Ethanol is a very good Replacement. Thus, I Am Strongly Pro-Ethanol.

    In my opinion, Big Oil has been fighting ethanol tooth-and-nail from the git-go. As a result of having this Opinion, I Am Very Anti-Big Oil.

    You notice I did not say I was Anti-Oil. That would be silly. We need oil, and we will need oil for, probably, a lot longer than we’ll have it. But, I am Anti-Exxon, Conoco, Shell, Koch, and all the others that would enslave me, and my family, to a rapidly depleting resource.

    So, There’s my Bias, and my Reasoning. I think some others should be so honest.


     

    Fair enough. As I said, everyone has some sort of an agenda, and I’m perfectly fine with it.

    But tempering your bias (especially in light of certain facts) is pretty important too…

     

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  57. By paul-n on April 8, 2010 at 5:50 pm

    Since, as so often happens, Rufus has managed to completely steer the conversation away from the original subject, I have here some more NZ info, for those like Jim who may be interested.  I lived there for a year and half, at the south end of the south island – next stop south is Antarctica.  The scenery there is truly amazing (it is where they filmed the Lord of the Rings), if it isn’t the most beautiful place on earth, it’s damn close.

    NZ’s population is 4.2m people, and has an area of 103,000 sq mi (same as Colorado), with a population density of 42pp/sq.mi, also about the same as Colorado.  NZ also has 20 million sheep, about 5 for each person (highest ratio in the world, Australia is next with about 4, Colorado has ten people per sheep)

    To drive from one end to the other is 1250 miles (not incl the ferry from N to S island) – the same distance as the I-5 from San Diego to Seattle, but with MUCH better scenery.  The latitude is about the same as S.D. and Seattle too.  

    The south island has an almost ruler-straight mountain range, the Southern Alps, which is longer from end to end than the European Alps.  Two of the glaciers on the west coast start at 10,000′ and run down to 1000′ above sea level – the only ones in the world to terminate among temperate rainforest.  In the 90′s they were advancing at 3′ per day.

    NZ is officially the youngest country on earth, the islands rising from the sea at the junction of the Australian and Pacific plates.  They are still rising, at an inch per year.  There is also, not surprisingly, a fair bit of volcanic, geothermal and earthquake activity, hence the nickname of the “shaky isles”.   The major ski area on the north island is on the side of an active volcano – it erupted two weeks after I skied there in 1996, putting a premature end to a record snow season.

    The climate is similar to the Pac NW, very wet on the west coast, a central mountain range, and dry(ish) on the east.  Winters are cool and wet, summers are mild and dry.

    NZ gets half its electricity from hydro, 10% from geothermal, 25% from NG and 10% (and dropping) from coal.  Wind makes up 3%, and is increasing.  NZ wind turbines (400MW of them) average 45% capacity factor, compared to European averages of 25-35%.  75% of electricity demand (and 2/3 of the people) is on the north island, but only 33% of production, and there is a high voltage DC cable between the islands.

    In the 70′s, NZ produced 50% of its oil, but today that figure is down to just 16% – hence their interest in alternative fuels.  Oil usage is 156,000 bpd, and on a per capita basis is 55% of the US. Interestingly, diesel fuel usage is equal to gasoline usage, even though most of their passenger vehicles(80%) are gasoline engined.  There is a lot of fuel used for truck transport (as the population is quite dispersed, and there is only a limited rail network.  There is also a lot used for shipping, both to the country and inter-island.

    Because the soils are so young, they are very fertile, hence NZ has a very productive agriculture industry.  In 1984, they also removed, entirely, all govt subsidies/tariff support for agriculture.  The industry reorganised and has grown ever since and is a major export earner for the country, and rejects any notion of subsidies.  An intersting contrast to the US ethanol industry, which (according to the industry itself) can only exist with substantial mandates and subsidy/tariff protection, and, basically, is so weak it couldn’t punch its way out of a wet paper bag.  

    The good soil and plentiful rainfall (one place on the wets coast gets 30′ per year) also make it a good place for forestry, and biofuel production.  During WW2, with fuel severely rationed, there was extensive use of wood gasifiers for vehicles and agriculture.  They have their own ethanol industry there, and e10 and even e85 fuel is available, but there is no ethanol mandate.  On producer makes ethanol from milk (!) using lactose in whey byproduct from cheesemaking.  

    Will be interesting to see what they do in regards to biofuels, they have lots of potential, and with 86% of oil imported, lots of incentive too…

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  58. By Kit P on April 8, 2010 at 8:50 pm

    Since, as so often happens, PaulN has
    worked into a discussion ignorant anti-ethanol statements about the
    US.

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  59. By paul-n on April 10, 2010 at 1:24 am

    Well, no.  That is a statement about the US ethanol industry, and is based on their own position, since they claim they cannot survive without continued government subsidy.

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  60. By russ on April 10, 2010 at 4:40 am

    @Rufus – İ said nothing about anyone tooting anyones horn.

    What İ did say was that you read one article and immediately started typing – generally more research is better than less!

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  61. By Wendell Mercantile on April 12, 2010 at 2:22 pm

    since they claim they cannot survive without continued government subsidy.

    Right Paul. The ethanol industry continually says their jobs depend solely on subsidies and government policy. Pretty good business model I guess — if you’ve got the politicians in your pocket to make it happen.

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  62. By Optimist on April 12, 2010 at 5:54 pm

    As so often happens, Kit made ANOTHER clueless statement, to go with a long list.

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