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By Robert Rapier on Feb 9, 2012 with 44 responses

Peak Oil & Carbon Emissions — R-Squared Energy TV Ep. 11

In this week’s episode of R-Squared Energy TV, I answer questions about peak oil and carbon trading markets.

Some of the topics discussed are:

  • Whether peak oil has been discredited
  • Recent media headlines on peak oil (or lack thereof)
  • Why I think peak oil “debunkers” miss the point
  • Why I believe carbon emissions will continue to climb
  • Why the successful sulfur trading markets are not analogous to carbon trading markets
  • Why I am skeptical that a global carbon trading scheme will work

Readers who have specific questions can send them to ask [at] consumerenergyreport [dot] com or leave the question after this post (at the original source). Consider subscribing to our YouTube channel where you’ll be able to view past and future videos.

Link to Original Article: Peak Oil & Carbon Emissions — R-Squared Energy TV Ep. 11

By Robert Rapier

  1. By Whirlwind on February 10, 2012 at 1:38 am

    Will peak oil result in the end of our current civilization? I.E. massive die off etc.

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  2. By Seth P. on February 10, 2012 at 1:55 am

    On the current price of oil ,what about the geopolitics, most importantly Iran and the Strait of Hormuz? I have read that Saudi Aramaco and other OPEC producers keep most of their wells on chokes and do have excess capacity. Does not the high price of oil reflect the uncertainty in the Middle East mostly concerning Israel and a nuclear Iran, rather then traditional supply and demand economics? Oil prices were around 30/bbl only about 2 years ago. Has there really been a true supply or demand side shift then results in a 3x price increase in the last two years?

    Furthermore, the technology for hydrocarbon generation is constantly increasing and the peak oil theory does not account for this. Examples of this are the most of the oil sands, oil shale, and methane hydrates. These may not be economical today with the current technology but may be producible in the near future. Should we not considers these resources at all?

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  3. By paul-n on February 10, 2012 at 2:45 am

    Good video RR.

     

    On the topic of “peak oil” I think it is also useful to ahve a look at what the world oil numbers actually are.  The EIA has all the data on global production, and Stuart Staniford went to the trouble of producing some nice charts of it;

     

    The blue part “crude and condensate” is basically  the volume of crude oil produced.  Condensate is the heavier gas liquids (hexane and up) that can form part of gasoline.    This metric includes all oilsands oil, deepwater, etc.

    NGL’s are mainly propane and butane, which have never been part of “oil”, as they evaporate at ambient temperature.

     

    So C+C is the measure of actual OIL production, and it has been pretty much flat (72-75mbd) since 2005.  

     

    Of course, in 2005 the oil price was $50/bbl, so since then we have seen the price double, for no real increase in production.  An economist would say that is an “inelastic” supply.

    I would say, unless something dramatic changes, that we can say we have “plateaued”, and if C+C turns down from here, then the 2005-2011 period was indeed the “peak”

     

    Now, the chart does show that “total liquids”, (which includes NGL’s biofuels like ethanol and biodiesel, plus liquids from gas-to-liquids plants, and coal to liquids plants) has been increasing over this period, but this not “oil”.

    Same for methane hydrates – they may yet turn out to be a source of energy, but they are not oil – they are an oil substitute.

    The whole debate is about peak *oil*, not peak *liquids*.  The more non oil liquids we use, the more we are transitioning away from oil – which is one of the things that will, by necessity, happen after the “peak” of “oil”.

    We will only know for sure when it is in the rear view mirror.

    But with production flat while prices have doubled, would you bet your house or your child’s college fund that we haven’t peaked, and there is lots more “spare capacity” out there?

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  4. By perry1961 on February 10, 2012 at 2:21 pm

    “I would say, unless something dramatic changes, that we can say we have “plateaued”, and if C+C turns down from here, then the 2005-2011 period was indeed the “peak”

    Maybe the controversy stems from the fact that there’s no plateau in Hubbert’s Curve. Instead, there’s an easily identified peak, and a symmetrical fall in production. Had the peak been in 2008, for example, 2010 production would have fallen to 2006 levels. Hubbert’s Curve can be plotted for any given area, but has to be re-plotted when conditions change. It accurately predicted the peak in the UK, but when the North Slope opened for production, the UK had a second peak. Curves plotted 20 years ago, when ultimate recovery was estimated at 40 or 50%, have to figure in 60 or 70% today.

    I personally think the plateau in world production is thanks to the doubling of oil prices, which made expensive projects like tar sands and deepwater drilling profitable. It also made possible a new discovery cycle in shale oil fields. Hubbert’s Curve doesn’t factor things like the economy, politics, or new discovery cycles into account. That’s a good thing imo, because this extended plateau beats the hell out of a peak, which would have been cruel and merciless. Instead of a depletion rate of 2-4% annually, we’ve been given a little time to develop alternatives.

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  5. By paul-n on February 10, 2012 at 2:38 pm

    You still have to give credit to Hubbert for putting his name and numbers to the whole concept.  Even though it had been talked about ever since oil was “discovered”, no one had modelled it.

     

    In the time scale of the oil age – 150yrs, I’d still say a 6yr period (05 to 2011) would count as a “peak”

     

    In any case, the growth in “other liquids” shows that we are developing “alternatives”, though they may not be any more “sustainable” than the oil they replace. 

     

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  6. By Tim C. on February 10, 2012 at 3:09 pm

    I agree with everything about RR’s Peak Lite theory, except the name. As Murray and King put it, “If oil production can’t grow, the implication is that the economy can’t grow either. This is such a frightening prospect that many have simply avoided considering it.” Peak Lite means economic stagnation, chronically high unemployment, and steadily declining standards of living. What’s “Lite” about that?

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  7. By rrapier on February 10, 2012 at 4:27 pm

    perry1961 said:

    I personally think the plateau in world production is thanks to the doubling of oil prices, which made expensive projects like tar sands and deepwater drilling profitable.


     

    That is it exactly. Oil production is a function of prices. That doesn’t mean there isn’t a limit, but certainly more oil will be produced as prices rise.

    RR

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  8. By rrapier on February 10, 2012 at 4:27 pm

    Tim C. said:

    I agree with everything about RR’s Peak Lite theory, except the name. As Murray and King put it, “If oil production can’t grow, the implication is that the economy can’t grow either. This is such a frightening prospect that many have simply avoided considering it.” Peak Lite means economic stagnation, chronically high unemployment, and steadily declining standards of living. What’s “Lite” about that?


     

    “Lite” was meant to convey that it wasn’t a true peak — not that the consequences would be minor. I explicitly spelled this out in the book.

    RR

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  9. By Jim Takchess on February 10, 2012 at 4:42 pm

    http://www.oftwominds.com/blog…..02-12.html

    I thought this supply chart and commentary is interesting. Thoughts?

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  10. By mac on February 10, 2012 at 5:42 pm

    Robert,

    This is not meant as nit-picking, but apparently the  Western based oil companies (as a group) actually made greater profits in 2011, but with the ecception of EXXON, actually produced less oil  for the world market than in 2010.

     

    http://www.americanprogress.or….._year.html

     

    profits up production down table

     

     

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  11. By paul-n on February 10, 2012 at 6:30 pm

    Mac,

     

    No nit picking there – they produced less oil, and its sale price is higher than in previous years. Both are what we expect with peak oil.

     

    Peak oil has never been implied to mean “peak oil profits”, in  fact, it likely means the reverse!

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  12. By mac on February 10, 2012 at 7:32 pm

    Paul.

    I understand exactly what you are saying.  

    The closer to “peak” production we get (if we haven’t already gotten there) the more Western oil companies and the NOCs can charge for oil, even as production declines.  Indeed, as production declines, the somewhat  in-elastic nature of oil demand makes supply short-falls even more profitable.

    A number of commentators have said the oil exploration business is tremendously expensive and that oil companies need the profits for the benign and completely and seemingly reasonable argument that the current world’s transportation sector and thereby world infra-structure is almost exclusively dependent on oil.

    So why are oil companies buying back Billions in stock instead of investing their  profits in oil exploration ?  Too many dividend checks ?  That seems unlIkely, because profits are at an all time high.

    Big Oil helps itself

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  13. By moiety on February 10, 2012 at 8:25 pm

    mac said:

    So why are oil companies buying back Billions in stock instead of investing their  profits in oil exploration ?  Too many dividend checks ?  That seems unlIkely, because profits are at an all time high.

     


    Actually the stocks themselves are not at an all time high. But even so buying back creates confidence in the market. That possibly leads to further investment. It is a bet but that is one way of looking at it.

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  14. By Ben on February 11, 2012 at 9:44 am

    This exchange is right on point. Thanks for the chart, Paul, as it speaks to totality of supply–the measurement that influences price in the marketplace. We migth argue ’til we’re blue in the face about peak vs. curve vs. plateau and it’s much to do about very little other than an acknowledgement that, yes, energy costs continue to rise as demand outpaces supply. This will continue until prices dampen demand (which is beginning domestically and occurred soem time ago in Europe) and otherwise spurs energy alternatives (beginning to happen domestically even as the pace has been quicker in Europe) as they increasingly become economically (and politically) viable. The further development of bioenergy supplies of all sources is interesting enough, but hardly dramatic given its contribution to overall supply–something that RR has emphasized along the way. To the extent that we are willing to allow the public debate, let alone demands on the public treasury, to be so disproportionately influenced by the Agribusiness Lobby
    (with abetting by Detroit) along the way, is testimony to dull minds and timid hearts. Watching the triangulation that has taken place for the past 30 years in Washington and in state houses throughout the Midwest, has been to witness the very things that some of Framers warned about at the outset of this grand experiment in limited, self-government. Regrettably, Madison’s “faction” appears to be in many respects the tail wagging the dog. Until such time we say “enough!” and force the politicians to stop massaging the issues we will continue to muddle along in an era of diminishing returns–at least relating to our political leadership (or lack thereof).

    Ben

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  15. By Joseph on February 11, 2012 at 11:56 am

    Will peak oil result in the end of our current civilization? I.E. massive die off etc.

    The simple answer is no.

    To the extent that we are willing to allow the public debate, let alone demands on the public treasury, to be so disproportionately influenced by the Agribusiness Lobby
    (with abetting by Detroit) along the way, is testimony to dull minds and timid hearts.

    We can wait around for politicians to do the right thing but what about personal responsibility? Why is there such a lack of patriotism that we the people do not do the right things individually?

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  16. By russ-finley on February 11, 2012 at 2:26 pm

    I agree with Robert about carbon trading. It isn’t going have any meaningful impact on a global scale, and because global warming is global, that scale is the only one that matters. I can’t see any way to reduce carbon emissions from power consumption other than the development of energy sources that are cheaper than fossil fuels. Nuclear is the only source that meets that criteria at this point (successfully competing in the energy market with coal and natural gas to make electricity). Not to say it can scale enough to solve the problem, but certainly it can be part of a renewable energy system to stabilize and therefore reduce the cost of a renewable energy system.

    I’ve always assumed that peak oil would have a soft landing. By that I mean the price will rise slowly enough to be compensated for by things like electric and hybrid cars, natural gas (compressed and liquid conversion), coal to liquid (God forbid) and tar sand oil, etc, etc. From an environmental perspective, some of these technologies are certainly much less desirable than others.

     

     

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  17. By paul-n on February 11, 2012 at 10:06 pm

    “are we crazy”

    If you have to ask that question, then yes…

     

    Keep in mind the X prize winning car showed you could get good mileage by having low weight and good aerodynamics.

    The reason why they chose E85 was because it could meet the emissions requirements without needing a catalytic converter or other stuff.  (This something the Ethanol industry seems to have overlooked)

     

    The ethanol price took a bit of plunge last month – about 40c.  Coincidentally, right after the expiration of the 42c VEETC;

    Chart here.

     

    Meanwhile, methanol is trading at $1.34/gal – the energy equivalent of ethanol at $1.85/gal.

    So, yes, you are crazy – even before the 30m ac of idle land..

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  18. By paul-n on February 11, 2012 at 3:31 pm

    I’ve always assumed that peak oil would have a soft landing. By that I mean the price will rise slowly enough to be compensated for by things like electric and hybrid cars,

    I guess the “hard landing” is then where we are forced to start giving up cars altogether, rather than finding every and any way to fuel them.

    That is something that no politician really wants to talk about, as this is seen as a reduction in “quality of life”, though it doesn;t have to be that way at all.

    American style car centric cites (and economy in general)  is massively consuming of resources, especially oil.  A significant shift away from this would create an equally significant reduction in oil usage.  But such a shift is quickly painted as “un-American”

     

    If nothing else, the hogh oil prices are causing (some) reductions in wasteful uses of oil.  Meanwhile, the oil co’s and biofuel developers hold out the promise of cheaper oil down the road, so people don;t have to change.  But if everyone knew that oil was going to stay expensive, and get more so, then some real long term planning would happen, both on the supply and consumption sides.

    Instead of a carbon tax, I think the most useful thing for the US to implement would simply be an oil import tax.  This will encourage domestic production (of oil and alternates), while also giving the price signal – that high prices are here to stay – to the consumption side.

    Even the carmakers have long argued for higher fuel taxes, as it makes it easier for them to sell fuel efficient vehicles.

    The current obsession with maintaining cheap fuel is simply delaying any real change.

     

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  19. By Ben on February 11, 2012 at 4:03 pm

    If cheap fuel has been sort of an addiction, the question essentially becomes one of incremental weaning or simple cold turkey. Our political system definitely favors incrementalism, but in the process we necessarily push off the hardest choices until there are little-to-no viable alternatives (resistance to our entry in WW II comes to mind). One presumes that short of monumental natural disasters undeniably tied to global warming–and proof of that could very well remain the subject of endless debate–our response to any reduction in the availability of fossil fuels will reflect cost constraints and not political machinations or moral appeals. Price will remain the final arbiter until such time we witness the most systemic revision to the theory and practice of political economy since the heyday the Scottish Enlightenment. I doubt we should hold our breath for that development, eh. Some muddling toward a modest recalibration of our generational expectations seems to remain the most likely message–or is that the massage?

    Ben

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  20. By tom-g on February 11, 2012 at 5:40 pm

    Robert or anyone else.

    I have often wondered WHY I can’t drive down to my local gas station and buy some gasoline blended with butanol instead of ethanol. According to the following excerpts from Wikipedia it has several advantages and I should be able to buy it.

    BEGIN QUOTE [selected parts]

    Biobutanol can be produced by fermentation of biomass by the A.B.E. process. The process uses the bacterium Clostridium acetobutylicum, also known as the Weizmann organism. The difference from ethanol production is primarily in the fermentation of the feedstock and minor changes in distillation. The feedstocks are the same as for ethanol: energy crops such as sugar beets, sugar cane, corn grain,… and non-food energy crops such as switchgrass and even guayule in North America… According to DuPont, existing bioethanol plants can cost-effectively be retrofitted to biobutanol production. Additionally, butanol production from biomass and agricultural byproducts could be more efficient (i.e. unit engine motive power delivered per unit solar energy consumed) than ethanol or methanol production. DuPont and BP plan to make biobutanol the first product of their joint effort to develop, produce, and market next-generation biofuels. The number of biobutanol producers with commercial plants coming on line continues to grow monthly.[citation needed]. At present, there are number of bioethanol plants, which are being converted to biobutanol plants, which should increase the number of butanol producers as they come on-line.

    END QUOTE

    So here is my question.

    If butanol can be shipped through existing pipelines; can be burned in internal combustion engines without modification and has about the same energy content as gasoline; where is it? What is the status of this alternative fuel?

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  21. By rrapier on February 11, 2012 at 6:44 pm

    Tom G. said:

    Robert or anyone else.

    I have often wondered WHY I can’t drive down to my local gas station and buy some gasoline blended with butanol instead of ethanol. According to the following excerpts from Wikipedia it has several advantages and I should be able to buy it.

    So here is my question.

    If butanol can be shipped through existing pipelines; can be burned in internal combustion engines without modification and has about the same energy content as gasoline; where is it? What is the status of this alternative fuel?


     

    This would be a good one to get into on the next video blog. The main issue, though, is cost. But this is worth a discussion, especially in the context of the Open Fuel Standard.

    RR

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  22. By Rufus on February 11, 2012 at 7:54 pm

    Three Facts:

    1) The X-Prize Winner proved that you can get very good mileage, and power from Ethanol with a couple of minor changes (lower displacement/higher compression/more EGR.)

    2) Unsubsidized Ethanol, even after two very bad years in the corn patch, is selling for $2.21/gal, compared to $2.97/gal for 84 Octane RBOB. (We could easily see E85 selling for $2.25 by the end of summer, while Reg Unleaded is selling for $4.00.)

    3) We are paying landowners Not To Plant 30,000,000 Acres.

    Now the question; Are We Crazy?

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  23. By rrapier on February 11, 2012 at 8:30 pm

    Rufus said:

    2) Unsubsidized Ethanol, even after two very bad years in the corn patch, is selling for $2.21/gal, compared to $2.97/gal for 84 Octane RBOB. (We could easily see E85 selling for $2.25 by the end of summer, while Reg Unleaded is selling for $4.00.)


     

    I haven’t checked on that, but it doesn’t really square with E85 pricing right now. That has tightened up immensely since the VEETC expired, and is only traded nationally at a 10% discount to gasoline. The market will dry up very quickly if that doesn’t change:

    http://e85prices.com/

    RR

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  24. By Rufus on February 11, 2012 at 8:36 pm

    CBOT Ethanol:

    http://news.ncgapremium.com/in…..subtype=25

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  25. By Rufus on February 11, 2012 at 10:36 pm

    I’ve noticed that several companies are leaving the gas plays. What happens to the price of methanol when nat gas goes back to $6.00, or $7.00kcuft from its present, unsustainable, low price of $2.46kcuft?

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  26. By rrapier on February 11, 2012 at 11:00 pm

    Rufus said:

    I’ve noticed that several companies are leaving the gas plays. What happens to the price of methanol when nat gas goes back to $6.00, or $7.00kcuft from its present, unsustainable, low price of $2.46kcuft?


     

    Fertilizer prices and process steam costs will go up, hence so will ethanol costs.

    What happens to ethanol prices when there is a major drought in the Midwest?

    RR

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  27. By Rufus on February 11, 2012 at 11:17 pm

    Look at the last two years. July, and August have been hot, dry, and horrendous. Yields well below trendline.

    $6.00 kcuft nat gas would probably only raise the price of ethanol by about a dime/gallon, I think. But, it would come close to doubling the price of methanol, wouldn’t it?

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  28. By paul-n on February 12, 2012 at 5:46 am

    Well, lets look at the last few years of NG and methanol;

    So for most of the last year it  has been around $4, and methanol from Jan 2010 to say July 2011 started at $1.10, went down to $1.00 and up to $1.28 in July, to then be $1.34 today.

    In the period from mid 06 to mid 07, the NG price was $6-8, and the methanol price for that went from $1.00 to $1.80 and finished at $0.96!

    So, at worst a 50% increase, not a doubling.

     

    And keep in mind that most of the existing methanol production is actually outside the US, so doesn’t get to take advantage of US natural gas prices (cheapest in the world).

     

    Finally, when making methanol for fuel – as opposed to chemical feedstock – it does not need to be as “pure”.  The small amounts of ethanol and higher alcohols produced in the process can be left in there – upping the energy value and decreasing cost.

     

    BTW, at 70% yield, it takes 0.08mmbtu of NG to make a gallon of methanol, so at current prices that is about 20c per gal of MeOH.  Taking it to $6 would make that 48c, adding all of about 30c to a gallon.

     

    Methanol is, on a btu basis, the cheapest liquid fuel you can buy.

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  29. By paul-n on February 11, 2012 at 10:10 pm

    In other news;

     

    Methanex to relocate methanol plant from Chile to Louisiana

     

    “The outlook for low North American natural-gas prices makes Louisiana an attractive location,” said Methanex CEO Bruce Aitken.

    “The US Gulf Coast is a prime location for a methanol facility, especially since demand for methanol is expected to grow in the coming years,” he added.

    I’d say that Rufus will be able to put some vitamin M in is fuel tank fairly soon…

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  30. By Rufus on February 12, 2012 at 12:24 pm

    Thanks, Paul. Those were the numbers I was fishing around for.

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  31. By Wendell Mercantile on February 12, 2012 at 1:09 pm

    Methanol is, on a btu basis, the cheapest liquid fuel you can buy.

    Something the corn ethanol boys hate to hear and are afraid of. With a suitable push, methanol could quickly supplant corn ethanol as the alcohol fuel of choice.

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  32. By paul-n on February 12, 2012 at 2:22 pm

    I haven’t poked around Methanex’s website for a while (other than the price charts), there is some interesting information there.

    They have a map showing their global locations.  The only facility in the US is a marketing office in Dallas!

    In Canada, their head office is in Vancouver, and they had no active production in Canada until last year;

    In 2011, Methanex restarted our 470,000 tonne per year methanol plant in Medicine Hat, Alberta, Canada.

    The current lower natural gas price environment in North America has made the Medicine Hat plant a competitive new supply source for Methanex’s customers and contributes local benefits and jobs to the region.

    That would be about 120m gal/yr, equivalent to a 90mgy ethanol plant.

    So, until now, all of their production was overseas, where they get cheaper labour, but, increasingly expensive NG.

    They are increasing their production in New Zealand too;

    Methanex’s Motunui facility has two methanol production trains. Methanex is currently operating the Motunui #2 plant which was restarted in 2008 after being idled in 2004 due to limited gas availability. In January 2012, the company announced plans to restart the Motunui #1 plant by mid-2012. This will provide the company with 1.5 million tonnes of operational capacity at the Motunui site.

    And in Egypt(!);

    The new 1.3 million tonne a year EMethanex methanol facility produced first methanol and began deliveries to customers in early 2011. Located in Damietta on the Mediterranean Sea, it is expected to be among the most energy-efficient methanol production facilities in the world.

     

    So, from 2008 to next year, Methanex will have added production capacity of 3.5 million tons/yr – almost doubling their capacity.  Clearly, they see some growth opportunities.  Their website and annual report make numerous references to energy industries and methanol as a fuel (already in use in China).

    I’ll bet they are looking really hard at more opportunities in Canada/US, all this cheap NG and expensive gasoline must look like a pretty good business opportunity. 

     

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  33. By paul-n on February 12, 2012 at 2:29 pm

    All that said, they do have a long way to go to catch up with ethanol. Methanex’s entire global capacity, at about 8m tpy, is the energy equivalent of 2billion gpy of ethanol – about 1/7th of the US ethanol industry.

    In oil terms, it is even smaller, equivalent to about 170,000 barrels/day.

    They could blend their entire annual production into the US gasoline supply (9mbd) and still not even get close to the 3% blending limit for methanol in gasoline.

     

    So, I don;t think the ethanol industry needs to be worried at all – there is plenty of room for more players at the gasoline substitution table

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  34. By armchair261 on February 12, 2012 at 9:48 pm

    mac said:

     

    So why are oil companies buying back Billions in stock instead of investing their  profits in oil exploration ?  Too many dividend checks ?  That seems unlIkely, because profits are at an all time high.

     

    Because their investment opportunities are not unlimited. Check oil industry domestic capital investment and drilling activity in 2011 compared to 2010. Where there are acessible opportunities, the industry is investing.
     

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  35. By Joseph on February 13, 2012 at 12:14 pm

    Methanex’s entire global capacity, at about 8m tpy, is the energy equivalent of 2billion gpy of ethanol – about 1/7th of the US ethanol industry.

    What will be interesting is that there is a convergence of several factors over the next few years. Alt fuels production will be increasing while gasoline consumption will be decreasing due not only to increasing CAFE standards but also a societal shift led by the younger generation. I watched a TV program last night on the Chicago auto show and the number of new hybrids is quite encouraging (on the other hand, the big 3 still try to use “muscle” to add sizzle, like the 550 HP Mustang Shelby). The show’s hosts said the the average age of cars on the road is 11 years so there is going to be a fairly large upgrading of fuel efficiency over the next few years.

    While more models are offering stop-start technology (like is on the Mini that you previously posted about) it is unfortunate that it isn’t available yet on more models though Ford and GM said that they plan for all models to eventually have it. Over 4-billion gallons of gasoline are wasted by traffic congestion every year interestingly it is double what you mentioned was Methanex’s total global production).

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  36. By paul-n on February 13, 2012 at 2:00 pm

    While that is good that there are more hybrids coming along, I am dissapointed that there are not many more diesels.

     

    Take a look at the UK top ten economical vehicles, and most of them, including the #1, are diesels.

    Many of them are diesel versions of cars that are sold here, and with prices starting at about $14k, they are much cheaper than any hybrid.

    With things like stop-start, and intermittent alternator operation (cuts in during braking, and out during acceleration), there are simple and cheap tweaks to economy that can be made.

    Hybrids make very good fuel savings, but at a significant cost in complexity.  And with the greater number of people that do lots of hwy mileage here, the diesels are the best option for them.

    The sizzle cars are a shrinking part of the pie, and of the glamour.  They are increasingly becoming objects for retired men trying to recapture their youth – most of today’s actual youth aren;t interested.  The customer base for the large and powerful vehicles is gradually getting older and smaller.

    Young people of today see a car not as a status symbol, but as a debt symbol.

     

    [EDIT]  forgot to add the link – UK top ten most economical cars

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  37. By mac on February 13, 2012 at 3:32 pm

    Joseph remarked:

    While more models are offering stop-start technology (like is on the Mini that you previously posted about) it is unfortunate that it isn’t available yet on more models though Ford and GM said that they plan for all models to eventually have it. Over 4-billion gallons of gasoline are wasted by traffic congestion every year

    ——————————————————————————————————-

    Stop-start technology can be used on standard ICE vehicles as well as hybrids:

    From the Car Connection:

    “In 2010, only eight percent of new cars (such as Toyota’s Prius, or Ford’s Fusion Hybrid) had start-stop technology, which shuts down the engine when the vehicles comes to a rest for more than a few seconds. Depressing the accelerator will instantly restart the car, and systems such as climate control, headlights and audio remain operational while the engine is turned off. The whole thing is almost seamless to drivers, who may not even notice that their car’s engine has stopped running. The feature can reduce fuel consumption and greenhouse gas emissions by as much as 12 percent, depending upon how much time is spent in city driving.

    Johnson Controls, a leading supplier of start-stop system components, estimates that up to 55 percent of new cars will employ this technology by 2016. That’s a global number, but the percentage is even higher for the European market, where 70 percent of new vehicles sold in 2015 are expected to be fitted with start stop systems.”

    http://www.thecarconnection.co…..r-next-car

    So ? The ICE is going to steal some micro or mild hybrid technology ?

    I say “Go for it” , since I am basically technology agnostic. Bring it on………… anything that will end our sole dependence on crude oil for transportation seems to offer a real plus side. That includes a possible open fuel standard, to include methanol, traditional bio-fuels and Exxon’s algal research. Diesels and hybrids offer only a short term moderation in crude demand. They do not solve the problem.

    If diesels save 35 % on oil demand then it will take the oil savings from 3 diesels in the developed West to sponsor a single diesel in China / India.

    I think the Chinese have already seen the hand-writing on the wall and are considering Stop-Start technology mandate on all their new vehicles..

    —————————————————————————————————-

    From Sustainable Business”

    “Why is stop-start important? Because it’s a very inexpensive way to significantly reduce emissions and increase gas mileage in conventional vehicles. The technology comes standard in hybrids – it’s now being adapted to work in all vehicles. It could be standard equipment for all new cars by 2020.

    Stop-Start systems eliminate idling. When you put your foot on the brake to stop a car, the system turns the engine off. When your foot touches the accelerator, the engine starts again. This simple technology reduces gas consumption by 10% in average city/highway driving to almost 20% in congested city traffic.”

    “Although various energy storage technologies are being developed for advanced vehicles, Stop-Start systems are widely viewed as an affordable, effective technology that’s available now, and will therefore be one of the first to gain mass acceptance for all vehicles.”

    http://www.sustainablebusiness…..re/id/1883

    You might say: ” Well, I hate Hybrids and EVs, so there !!!”

    Good for you, because, in the not too distant future, you will most likely be driving a standard ICE car with hybrid and /or EV technology.

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  38. By Joseph on February 13, 2012 at 5:25 pm

    I am dissapointed that there are not many more diesels.

    I agree.

    Hybrids make very good fuel savings, but at a significant cost in complexity. And with the greater number of people that do lots of hwy mileage here, the diesels are the best option for them.

    As I posted in the other thread, hybrids are a stop gap… plug-in hybrids are the real “hybrids” as it is basically only adding batteries and upgrading the software as many conversions have demonstrated. With battery costs coming down it is the bridge to all electric which I believe is where we will end up.

    I have been looking at the commute data and there is a mistaken belief about the high number of people that do a lot of hwy mileage on their commute. Second, even on the hwy there is a lot of stop-start during peak hours.

    So ? The ICE is going to steal some micro or mild hybrid technology ?

    I say “Go for it” , since I am basically technology agnostic. Bring it on………… anything that will end our sole dependence on crude oil for transportation seems to offer a real plus side.

    I posted in another thread that at a minimum all cars should have stop-start and, even better, a mild hybrid system like GM’s e-assist. As you point out, the system is very affordable at the OEM level… something like $100.

    Andy Grove (co-founder of Intel) is promoting the retro-fitting of existing larger fleets of low-mpg vehicles with stop-start/mild hybrids.

    There is no reason why… with stop-start. mild hybrid, diesel, NGVs, etc, that we can’t be off OPEC oil within 10 years… if not earlier if we retrofit the low hanging fruit and pass some sort of gasoline “tax & dividend” bill.

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  39. By paul-n on February 13, 2012 at 6:12 pm

    When I say hwy I actually mean out of the city – look at the traffic on Californias I-5 to see what I mean.

    For many people, they are facing longer commutes to work – often 50+ miles, because that is where the job is (or has relocated to), travelling salesmen, etc – a small diesel car is perfect for that – affordable to buy and run.

    The plug in hybrids have a lot of work to do to get their cost down to the point where it is actually paid back in fuel savings, and the smaller the vehicle, the greater the relative cost.  For the lowest overall cost per mile, it would be hard to beat those euro diesels.

    For the big vehicles, they should almost all be diesels.  A 1/3 fuel saving on an F-350 is significant.  Then, for those big vehicles, and in your mild hybrid – a small weight penealty for a lot of regenerative braking – and you have a real winner.

    I like the euro system of not only high fuel taxes, but the annual road tax based on the vehicles fuel consumption rating (as measured in CO2/mile).  It all helps encourage people not to supersize their vehicles. 

     

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  40. By Walter Sobchak on February 13, 2012 at 10:06 pm

    Robert:

    If $100/bbl. oil shows that we are at peak oil, what does $2.50/mmbtu nat. gas show?

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  41. By rrapier on February 13, 2012 at 10:52 pm

    Walter Sobchak said:

    Robert:

    If $100/bbl. oil shows that we are at peak oil, what does $2.50/mmbtu nat. gas show?


     

    I have said it before, but I think it says that we have quite ample supplies of natural gas. I know some think these huge volumes are a mirage that will go away soon, but the price signals something else.

    RR

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  42. By paul-n on February 14, 2012 at 2:25 am

    As I understand it, a lot of this NG is coming on the market from… drilling for oil!

    The high oil price has made all sorts of otherwise marginal shale oil plays – like the Bakken – suddenly very profitable.  So when they do these big horizontal wells and frack jobs to release the oil, they also get a lot of gas (“wet gas”).  This is what has flooded the market, while drilling for “dry gas” (with no oil associated with it) has actually decreased.

    So in this case, the (temporary) glut of gas is despite high oil prices, but is actually because of them.

     

    How long the cheap gas will last is a good question – if enough “dry gas” exploration is stopped – and this is happening as we type – then the surplus gas production will fall.  But everyone knows the reserves are there, so that too will help keep prices down.

     

    Until the LNG and GtL plants get going – there are three LNG plants in the works for BC alone.  Why sell into the domestic market at $2.50 when you can liquefy and sell into asia for $14.75?

     

    Just for comparison,  oil at $100/bbl is equal, on a btu basis,  to $17.20 for LNG.

     

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  43. By mac on February 14, 2012 at 4:28 pm

    Paul remarked:


    As I understand it, a lot of this NG is coming on the market from… drilling for oil!

    The high oil price has made all sorts of otherwise marginal shale oil
    plays – like the Bakken – suddenly very profitable.  So when they do
    these big horizontal wells and frack jobs to release the oil, they also
    get a lot of gas (“wet gas”).  This is what has flooded the market,
    while drilling for “dry gas” (with no oil associated with it) has
    actually decreased.

    So in this case, the (temporary) glut of gas is despite high oil prices, but is actually because of them.

     

    How long the cheap gas will last is a good question – if enough “dry
    gas” exploration is stopped – and this is happening as we type – then
    the surplus gas production will fall.  But everyone knows the reserves
    are there, so that too will help keep prices down.

    =================================================================================

     

    Lately. a lot of the drilling here in the Eagle Ford shale formation in Texas has been concentrated on nat gas condensates and oil. and not dry gas.

     

    http://www.eaglefordshale.com/


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  44. By Optimist on February 16, 2012 at 5:28 pm

    2) Unsubsidized Ethanol, even after two very bad years in the corn patch, is selling for $2.21/gal, compared to $2.97/gal for 84 Octane RBOB. (We could easily see E85 selling for $2.25 by the end of summer, while Reg Unleaded is selling for $4.00.)
    So is Iowa getting ready to declare its energy independence? Or will they continue to insist on sharing the benefit with the East Coast, provided Uncle Sam (Sugar Daddy for citizens of the Heartland) pays for a dedicated pipeline?
    Actions speak louder than words, Rufus!

    [link]      
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