As Cheney's Middle East Energy
Strategy Collapses
United States Admits Peak Oil Is Coming
www.btinternet.com/~nlpwessex/Documents/EnergyMay2007.htm
The Only Question Is When,
And What Will Be The Impact On Climate Change?
Energy Update, May 2007
"Many environmentalists seem to dismiss or ignore peak oil because they simply cannot see it as significant when compared to climate change. But this is to miss the point. Oil depletion is deadly serious in its own right, but it also has the capacity both to worsen emissions and destroy the wealth needed to fight global warming."
David Strahan - End of oil heralds climate pain
BBC Online, 29 March 2007
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'Global Warming
Turbo' |
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US Has No Plans In
Place To Address 'Peak Oil'
(Except Dick Cheney's Failed
Criminal Ones)
"Britain's defense secretary during
the Iraq war says London underestimated Vice
President Dick Cheney's influence, adding another
voice to the growing view that the U.S.-led coalition failed to plan properly for the
aftermath of Saddam Hussein's ouster, a newspaper reported Wednesday.... Hoon said the British side had not comprehended Cheney's influence. Even when Blair and President Bush agreed on some matter, 'sometimes ...
the decision actually came out of a completely
different place. And you think: What did we miss? I
think we missed Cheney,' Hoon was quoted as saying. He did not cite any examples of decisions
apparently reversed by Cheney."
Cheney Iraq role reviewed in Britain
Associated Press, 2
May 2007
"As crude oil
prices surge on rising political tensions with Iran, a new government report released
Thursday said that the U.S. is unprepared to face an oil
supply crisis and urged U.S. policymakers to develop a
strategy in order to reduce potential risks related to an oil shock. The report from the U.S. Government Accountability Office
concluded that the U.S. has no plans in place to address 'peak
oil,' the future point in history of maximum oil production,
which would be followed by irreversible declines in oil fields around the world. 'While
the consequences of a peak would be felt globally, the United States, as the largest
consumer of oil and one of the nations most heavily dependent on oil for transportation,
may be particularly vulnerable,' the GAO report said. An expert told CNBC on Thursday that
peak oil is the 'the single biggest issue to threaten sustainable society' in the United
States. 'We are on the verge of actually replacing global
warming by this term peak oil,' said Matthew Simmons, author
of Twilight in the Desert: The Coming Oil Shock and the World Economy. 'We have demand
roaring ahead and supply is faltering.'" |
"The U.S. government is in need of a
strategy to minimize potentially dire economic consequences after worldwide oil production peaks and begins to decline, the investigative arm of Congress said
Thursday.... In letters to the GAO, the Energy
Department and Interior Department agreed with most aspects of the report."
Report: Gov't needs plan for oil peak
Associated Press, 29
March 2007
And Neither Does Britain
Peak Oil Starts To Hammer UK National Budget
Gordon Brown Scrambles For Oil Company Taxes As North Sea Revenues Plummet
And Sours Relations With BP In The Process
"
A £2.8bn black hole in North Sea tax revenues has opened up after Chancellor Gordon Brown was forced to admit he has got his sums badly wrong on last year's controversial raid on oil and gas revenues. Latest projections suggest the Treasury is finally admitting the North Sea's oil and gas reserves are in terminal decline. Brown last year doubled the supplementary tax charge on North Sea companies to 20% which, with existing rates of corporate tax, means the oil and gas companies are paying about half their North Sea revenues in tax. The Chancellor justified the increase on the super-profits being made by the oil companies. But buried in his Pre-Budget Report yesterday was an admission by the Chancellor that there will be a significant shortfall in the forecast tax take, reckoned to be around £2.8bn, next year because the Treasury has misjudged the increasing difficulty and cost of lifting the dwindling North Sea reserves. The report says this year's tax take will be on budget at just over £10bn. But while the oil is trading at $9 a barrel above the Treasury's projections, the 2007-8 take of £10.7bn is 'a much more modest increase than assumed in the Budget 2006 forecast'. The Pre-Budget Report admits to a catalogue of miscalculations, not least a significant drop in North Sea output this year, down 8% in the third quarter of 2006, 38% lower than in 2000. Output is expected to drop by 3% a year until 2011. 'The structural decline since 2000 reflects the rundown of reserves in the North Sea and increasing extraction costs for the remaining oil and gas,' says the report.""Our forecasts of the current [budget]
balance from 2007-08 to 2011-12 are affected by one major change in the last year - the sharply lower levels of
production and yet higher costs in the North Sea - which have this year reduced tax revenues from £13 billion to £8 billion
and for each year into the future
cut them by an average of £4 billion a year."
Gordon Brown's 2007 budget
Reuters,
21 March 2007
"BP is Britain's biggest company, the
fifth largest in the world. It employs 17,000 people in Britain and contributes £1.3 billion every year in tax revenue. Everyone who owns a car buys BP fuel, and everyone who has a pension
fund is likely to be a shareholder. Asked in a recent
interview whether there was anyone in Britain more powerful than him, Gordon Brown named
four men, all businessmen. First on his list was Lord Browne, until this week boss of BP, ennobled by this Government in 2001 and dubbed the Sun King for the way
he had built BP into an industry giant..... Four months ago, this newspaper was approached
by Lord Browne's former lover, a young Canadian called Jeff Chevalier. We were told by him
that, despite being honoured in public and befriended
in private by the Chancellor, Lord Browne thought
the Government's taxes on business so damaging that he had to consider drastic changes in the way BP
operated. According to Mr Chevalier, Lord Browne
threatened to move BP's headquarters abroad. If
carried out, such a move would be devastating, not
only for the Government's tax revenues but for the
tens of thousands of highly-paid jobs an international business such as BP sustains when
headquartered in Britain. This was a business story
of great significance - but obviously Mr Chevalier's
account had to be checked, and calls were put in to BP, outlining what he was saying.
The first response came from a public relations consultant working directly for
Lord Browne. He told us that while Mr Chevalier had been Lord Browne's lover, it was
completely untrue that Lord Browne had made the
alleged threat, and in any case Lord Browne never,
ever discussed business matters with Mr Chevalier. At 10am the following morning, The Mail
on Sunday's Political Editor took a phone call from BP's highly respected public relations
chief. His message was the exact opposite: of course BP had looked at the problem Mr
Chevalier outlined, nor should we forget that at the time of Lord
Browne's threat the Government was contemplating a windfall tax on North Sea oil profits.... Neither PR man made any issue of Lord Browne's homosexuality, which
was well-known in the world of business and politics. Neither was it to be the focus of
our story beyond sufficient reference to explain how a 27-year-old Canadian had been privy
to such information. We cleared space for a story which would report Mr Chevalier's
claims, reflect the fact that there appeared to be conflict within BP over how to respond
and include information on other major companies
facing the same problem as BP and considering
meeting it in the same way. What we did not know was that someone had advised Lord Browne
to go to a firm of showbiz lawyers called Schillings....... He [Chevalier] produced a
laptop Lord Browne had given him, opened it up, and sure enough it declared it was the
property of BP and contained three months of Lord Browne's confidential company email
traffic."
Privacy, and the perils of secret justice
Mail
On Sunday, 6 May 2007
Or Anyone Else (Except Sweden)
"In March 1971, a Mexican fisherman
named Rudesindo Cantarell took a few geologists from state-run oil company Petroleos
Mexicanos to this spot, where he had seen oil slicks. Mr. Cantarell didn't know it, but he
had stumbled across one of the largest offshore oil fields ever found. A few decades and
12 billion barrels of oil later, the field that bears Mr. Cantarell's name is dying, and
Pemex, as the state-owned company is known, is struggling to stave off the field's demise.
From January 2006 though February 2007, Cantarell
lost a staggering one-fifth of its production, with daily output falling to 1.6 million
barrels from two million. The oil industry was
stunned. Cantarell, which currently produces one of
every 50 barrels of oil on the world market, is fading so fast analysts believe Mexico may
become an oil importer in eight years. That would
batter Mexico's economy, which depends on oil exports to fund 40% of its government
spending. The continued deterioration of the world's second-biggest field by output would
also put pressure on prices on the global oil market, where supplies are barely keeping up
with growing demand as it is. And it would leave the U.S. even more dependent on Middle
Eastern supplies -- and that much more vulnerable to political tumult in that region. The demise of Cantarell highlights a global issue: Nearly a quarter of the world's daily oil output of 85 million barrels is
pumped from the biggest 20 fields, according to estimates from Wood Mackenzie, a
Scotland-based oil consulting firm. And many of those fields, discovered decades ago,
could soon follow in Cantarell's footsteps. It's widely believed that the world's biggest
oil fields have already been found. In the decades leading up to the 1970s, the world
discovered eight big fields that produced between 500,000 to one million barrels a day,
according to Matthew Simmons, a veteran oil industry banker. During the 1970s and 1980s,
only two were found. Since then, only one -- the Kashagan field in Kazakhstan -- has the
potential to easily top the 500,000 barrel-a-day mark. Two
decades ago, about a dozen fields produced more than a million barrels a day. Now there
are only four, one of which is Cantarell. The future
of two others, discovered more than 50 years ago, remains in question. Some analysts
speculate Saudi Arabia's Ghawar, the biggest field by far, could begin a gradual decline
within a decade or so. Another, Kuwait's Burgan, is showing signs of maturity. In November
of 2005, Kuwait Oil Co. lowered its estimate of the field's sustainable production level
to 1.7 million barrels a day from 1.9 million a day."
Mexico Tries to Save A Big, Fading Oil Field
Wall St Journal, 5 April 2007
Many people think that running out of oil, or 'peak oil', would be good for the climate. In his new book 'The Last Oil Shock', David Strahan begs to differ; he suggests it may bring catastrophe. "It is becoming increasingly
clear that global oil production will soon go into terminal decline, with potentially
devastating economic consequences. Although the idea of peak
oil has traditionally been ridiculed by the
industry, now even some of the world's most senior oilmen concede the case. Last year
Thierry Desmarest, chairman of Total, the world's fourth largest oil company, declared
that production would peak by around 2020. He urged governments to find ways to suppress oil demand
growth and put off the witching hour. Other forecasters are convinced the peak date is even closer. But many environmentalists continue to resist the idea. Some seem to suspect that anybody who argues that oil production is set
to fall must be a closet climate change denier with a secret agenda. Others, like Stephen
Tindale of Greenpeace, instinctively distrust forecasts of an imminent peak, but wish fervently
that it would come soon. 'Let's hope that the oil does run out', he told me, 'and that the
world has to develop alternatives to oil seriously quickly, and from a climate point of
view that would be an excellent outcome.' Neither
position could be more wrong. It is mathematically
impossible that peak oil will solve climate change. Although oil is the biggest single source of
energy-related greenhouse gases, coal and gas combined are bigger still, and the expected
growth in their emissions would overwhelm any reduction from oil. As I demonstrate in The Last Oil Shock using the International Energy Agency's 'business-as-usual' forecast,
even if oil production peaks in 2010 and immediately starts to fall at 3% a year, total emissions
would still rise by 25%, reaching 32 billion tonnes in 2030. Yet by that time, we need to
be well on the way to at least a 60% cut in emissions. So
it is quite possible to run out of oil and pollute the planet to destruction
simultaneously. In fact peak oil could even make emissions worse if it drives us to
exploit the wrong kinds of fuel. Burning rainforest
and peatlands to create palm oil plantations for biofuels releases vast amounts of CO2,
and has already made Indonesia, according to some ways of calculating it, the world's
third biggest emitter after the US and China. Synthetic transport fuels made from natural
gas using the Fischer-Tropsch process emit even more carbon on a well-to-wheels basis than
conventional crude; and when the feedstock is coal, the emissions double. None of these
alternatives are likely to fill the gap left by conventional
crude - at least, not in time. But because they are so much more carbon intensive, it is quite easy
to conjure scenarios in which we still suffer fuel shortages while emitting even more CO2
than in the current business-as-usual forecast - the worst of all possible worlds." To View Introductory Video By David Strahan On 'You Tube'
- Click Here 'Last Oil Shock' Already In Its Third Print Run |
Still Don't Get The Picture?
"All
the worlds extra oil supply is likely to come from expensive and environmentally
damaging unconventional sources within 15 years,
according to a detailed study. This will mean increasing reliance on hard-to-develop
sources of energy such as the Canadian oil sands and
Venezuelas Orinoco tar belt. A report from Wood Mackenzie,
the Edinburgh-based consultancy, calculates that the world holds 3,600bn barrels of
unconventional oil and gas that need a lot of energy
to extract. So far only 8 per cent of that has begun
to be developed, because the world has relied on easier sources of oil and gas. Only 15
per cent of the 3,600bn is heavy and extra-heavy oil, with
the rest being even more challenging. The study
makes clear the shift could come sooner than many people in the industry had expected,
even though some major conventional oil fields will still be increasing their production
in 2020. Those increases will not be enough to offset
the decline at other fields."
Study sees harmful hunt for extra oil
Financial
Times, 18 February 2007
"The Bush administration wants Canada
to bypass environmental rules to quintuple its export
of oil sand crude to the United States. The two
sides discussed the move during a January 2006 meeting in Houston, according to a
transcript recently obtained and released by Radio-Canada, the Canadian Broadcasting Co.'s
French network. Canada's natural resources agency and the U.S. Energy Department organized
the meeting of government officials and oil company executives from both countries.
Canada, the No. 1 oil exporter to the United States already, was
urged to increase its production of crude from oil sands from 1 million barrels a day to 5
million barrels a day. Oil sands are deep geological
sands mixed with oil that is separated at high temperatures. But
the process is energy intensive and is Canada's largest emitter of new greenhouse gases."
U.S. urged Canada to increase oil sands
United Press International,
19 January 2007
"Kyoto committed Canada to cutting emissions by 6 percent from 1990 levels by 2012. Emissions
are now 35 percent above that
target and are set to rise more rapidly as oil-rich tar sands are opened up in western
Canada....."
Canada faces U.N. grilling over Kyoto abandonment
Reuters, 12 November 2006
| In This Bulletin On The Web |
| The Beginning Of The
End Of Official 'Peak Oil' Denial As The Cheney-Blair Iraq Campaign Faces Defeat |
| Cheney's Failed Secret
Plan To Delay Global Oil Crisis |
| 'The Final Frontier' Shell And Major Canadian Bank Say Conventional Oil Production Has Already Peaked |
| BBC Why 'Peak Oil' Is A Major Threat To Climate Change |
| What Do Tar Sands Mean For Global Energy Supply And Global Warming? |
| Peak Oil And Global
Warming How Gordon Brown Blew The North Sea Oil And Gas Legacy |
| UK Treasury
Increasingly Strapped For Cash How Chaos In Iraq Hit BP's Chances Of Replacing Falling North Sea Production And Why Its Relationship With Tax Hungry New Labour Has Wobbled |
| UK 'Peak Oil' Road Show |
| Pioneering Welsh Town Begins The Transition To A Life Without Oil |
Harnessing Nature's Giant Power House |
| But Meantime Pressures
Continue To Build Peak Oil 'Newsbites' |
So What Now In The Post-Blair Era?
"There
are three reasons why there should be an election for a new leader when Tony Blair finally
goes. Only an election confers democratic legitimacy
on the succession. Second, party members expect to have a choice about who should lead
them. They have hardly been listened to for most of the last 13 years, and have every
right to demand that their voice be listened to now. And third, there are major
differences of view about the government's direction of travel which need to be
understood, debated and voted on within the party. There are other, better
alternatives..... We need a new climate change and
energy policy if we are not to become over-dependent on imported fossil fuels. It is not
sustainable, let alone not legal, to go on fighting wars to grab control of the remaining reserves of Middle East oil when anyway
the oil will soon run out...... We need a profound
change in every aspect of government and our way of life -- not just energy, but
transport, industry, building, agriculture, public expenditure and taxation, and foreign
policy, in order in every area to give absolute priority to combating climate change. We need a crash programme, as we have done before in wartime, to
develop renewable sources of energy, in which we are very well endowed, plus a massive
programme to improve energy efficiency and energy conservation. Peace, social justice, climate survival - those should be our top
priorities."
Michael Meacher - Why I want to be prime minister
Guardian
- Comment Is Free, 22 February 2007
"The recent cabinet agreement in
Baghdad on the new draft oil law was hailed as a landmark deal bringing together the
warring factions in the allocation of the country's oil wealth. What was concealed was
that this is being forced through by relentless pressure from the US and will sow the
seeds of intense future conflict, with serious knock-on impacts on the world economy.... Above all, the policy is flawed by its extreme short-sightedness. Even if the US were to win its war in Iraq, which now looks virtually
impossible, its incremental gain before the oil runs out would be short-term, while its
exposure to intensified and unending insurgency because of perceived US seizure of Iraqi
oil rights, especially if extended to Iran, would be disproportionately
enormous both in the Middle East and maybe also at home. It
is diametrically the opposite of the policy to which the whole world will be forced
ineluctably by the accelerating onset of climate change. Perhaps the single greatest gain of the west learning this lesson of
weaning itself off its oil addiction is that it would end this interference in the
internal affairs of Muslim countries simply because they happen to have oil - the central cause of world conflict today."
Michael Meacher - The rape of Iraq's oil
Guardian
- Comment Is Free, 22 March 2007
"The US would also have even less
justification under international law for such an attack on Iran than it had over Iraq.
The UN security council would never authorise it because Iran has not breached the terms
of the nuclear Non-Proliferation Treaty.
Nor can the US or Israel claim they had the right to a pre-emptive strike. By
long-established law, a pre-emptive strike is justified only to defend against an
'imminent and certain' attack. To claim the right of self-defence against a threat that
may or may not emerge in 5 years' time is to claim the right to wage aggressive war
whenever one chooses. It is worth recalling that that was one of the two grounds on which
Nazi leaders were convicted and executed at Nuremburg. The truth is, Iran has done nothing
illegal. It has demonstrated no territorial ambitions and has not occupied any foreign
country - unlike the US, Britain and Israel. It has complied with its obligations under
the NPT to allow inspectors 'to go anywhere and see anything' - unlike the US and Israel
which refuse this. Indeed, by comparison, Israel has refused to recognise the NPT, and
holds between 200-500 thermonuclear weapons targeted at Iran and other Middle East
countries. Nor do any of the West's arguments for war against Iran hold water. It is said
repeatedly that Iran is about to produce a nuclear bomb, and cannot be allowed to do so.
In fact, Iran is not about to produce a bomb or anywhere near it. Iran is believed to have
enriched uranium to the 3.5% level, enough for use as nuclear fuel, but it would require
90% enrichment, with 50-100 kg of it, to make a single bomb. As to the argument that Iran
should not be allowed to have nuclear weapons, who decides that? What right does the US
have to decide who should or should not have nuclear weapons? ..... So why, against all
this background, is the US so bent on attacking Iran? Two considerations are probably
decisive. One is that President Bush clearly sees his role in the Middle East in messianic
terms and will not let does-not-make-sense arguments stand in the way of what he regards
as his manifest destiny. The other is oil. Iran holds
the world's largest supplies of oil after Saudi Arabia and Iraq, and holds more oil and
gas combined than any other country on the planet. As Peak Oil rapidly approaches, the US
demand to control the lion's share of what is left - pitifully short-sighted though such a
policy is - is now the dominant driving geopolitical force in world politics today."
Michael Meacher - A war down memory lane
Gardian
- Comment Is Free, 11 January 2007
"Whilst it has taken 145 years to
consume half of the 2-2½ trillion barrels of conventional oil supplies generally regarded
as the total available, it is likely that, given the huge increases in demand from China
and India, with rates of growth of 7pc-10pc a year in economies supplying two-fifths of
the world population, the other half will be largely consumed within the next 40 years.
The significance of this can hardly be over-stated. Oil is the fundamental underpinning of
our civilization. Alternatives like biofuels, ethanol or biomass can play a marginal
supportive role but nowhere near on the scale required.... Some 98pc of global crude oil
comes from 45 nations, of which more than half may have peaked in oil production,
including seven of the 11 Opec nations. Major oil field discoveries fell to zero for the
first time in 2003. Worse still, the excess capacity held by Opec nations has dwindled,
from an average of 30pc to about 1pc of global demand now. The political significance of
this is almost incalculable. World oil and gas production is declining at an average of
4pc-6pc a year, while demand is growing at 2pc-3pc a year.... Global oil production is 84m
barrels a day. As the president of Exxon Mobil Exploration, John Thompson, said in 2003:
'By 2015 we will need to find, develop and produce a volume of new oil and gas that is
equal to eight out of every 10 barrels being produced today.' That is not just a problem
of better technology. Additional oil on that scale is not available. There are three
options to escape this dilemma. One, which the US is ruthlessly pursuing, is to grab by
force of arms the lion's share of what remains. A
second is to shift into unconventional sources of oil - tar sands, extra heavy oils and
gas to liquids processing. A third is to accelerate
the switch out of oil altogether into renewable sources of energy, especially wind power,
biomass, tidal power and solar. What is so disturbing
is that long-term global policymaking on this, perhaps the biggest decision this century,
is virtually non-existent and driven instead by self-destructive short-termism. The first option was the real reason behind the first Gulf War in 1991, to deter
Saddam gaining control of the Saudi oilfields. It was also a major reason for the orchestrated revolutions in Ukraine, Georgia and Kyrgyzstan, as well as the military interventions in Afghanistan and Yugoslavia, all of which offer key oil transit
routes from the Caspian Sea Basin, which holds the world's biggest untapped fossil fuel
resources, worth up to $5 trillion. Equally it is also one major reason for Russian intervention in Chechnya, part of the northerly
transit route between the Caspian and Black Sea under current Russian control. It is
certainly another reason for US concern about Iran, holding only slightly lower oil
reserves than Iraq. But, above all, option one was the main trigger
for the Iraq war. Of more than 80 oilfields discovered in Iraq, only about 21 have
been at least partly developed. Despite this, Iraq's proven oil reserves exceed 110bn
barrels but its total reserves are likely to be far more, perhaps even 200bn barrels more.
This explains US determination to control this fulcrum but it has involved an escalating
political, military and economic price that must make this option unsupportable even for
the US. An alternative strategy is to take advantage of the rising oil price to develop unconventional oil sources, notably the Athabascan tar
sands in Canada and the Venezuelan Orinoco heavy oils.
However, the downsides in terms of cost, manpower,
water shortages and, above all, CO2, are prohibitive.
Cost-wise, the International Energy Agency reckons that investment needed in oil and gas
over the next 25 years to meet an expected 50pc increase in global demand, will be $5
trillion, equivalent to more than four times the entire GNP of the UK. The biggest
constraint, however, is environmental. It takes almost as much energy to mine, process,
refine and upgrade the oil extracted from tar sand as the energy contained in the light
oil produced. Worse still, the processing releases five to 10 times more greenhouse gases than a barrel of conventional oil. This is the exact opposite to the
scientists' requirement for the world to cut greenhouse gas emissions by at least 60pc by
2050. The third option is clearly the right way
forward - a new energy world order. The potential for powering the world economy via renewables is almost
infinite. Governments should now be switching to this option, far faster and on a far
greater scale."
Michael Meacher - Former Blair Minister
Our only hope lies in forging a new energy world order
Daily
Telegraph, 26 June 2006
"... professor Bartlett, he and I are
the two Republican scientists in the House [of Representatives], and we're both very
concerned about it [peak oil], we've both given speeches. In the evening we have what's
called Special Orders after regular business is done. We can get up, and we can give
speeches about things we are concerned about. He has now given something like thirty
speeches on the need for energy conservation, so forth. I have joined him a number of
times, and have also spoken on my own. It's just a tough sell. Sometimes people don't want
to believe what they don't like, and that's the problem here. There is simply not an
infinite amount of oil... we have to stop using so much energy. Not just gasoline, but all
energy. It's a tough battle because we're all used to cheap energy.... We are
running out of fossil fuels. And years ago, I advocated that we had to start developing
alternative forms of energy.... my dream is someday that we'll have solar shingles on
every house, instead of asphalt shingles, and that these solar shingles will provide a
good deal of the energy that your house can use. So, there are a lot of options, we just
have not pursued them. ... We have to do it. I have spent a lot of time trying to wake up the congress and wake up
the country. A lot of people simply don't want to believe it, because they can't believe
it. But, I've gotta tell you that, that's the story..."
U.S. Representative Vernon Ehlers of Michigan
Energy Bulletin, 6 May 2007
"Competing
energy needs are the greatest source of potential conflict between the United States and
China, Senator Joe Lieberman says.In remarks to the Council on Foreign Relations December
1, the Connecticut Democrat, a member of the Senate Homeland Security and Governmental
Affairs Committee, said the United States and China must work together to meet both
countries' energy needs. '[I]t is time the U.S. and China not only recognize the
similarity of our oil dependency status, and the direction that competition may take us,
but begin to talk more directly about this growing global competition for oil so that we
can each develop national policies and cooperative international policies -- even joint
research and development projects -- to cut our
dependency on oil before the competition becomes truly hostile,' he said. The senator urged the expansion of the U.S.-China Energy
Policy Dialogue established in 2004 to encourage the
development of alternative fuels and vehicles that are powered by energy sources other
than gasoline. He also encouraged China to join the
International Energy Agency (IEA), saying: '[A]llowing China to stay out of the IEA
and the global effort to deal with energy problems makes no sense when you look at it in
light of our shared economic and security needs.' According to Lieberman, China's
increasing demand for oil has led it to take some questionable actions such as negotiating
energy contracts with Iran and Sudan that 'not only would we not consider because of our
values,' but that also make China 'an ally of nations that are openly hostile towards
us.'" "Today I want to discuss what I
believe is one of the biggest sources of potential friction between the U.S. and the PRC
(People's Republic of China) - that is our global
competition for oil. The U.S. and China are now the
world's number one and two consumers of oil respectively, with China's need growing as
rapidly as its economy is. This could lead to Sino-American confrontations over oil that
could in the years ahead threaten national security and global security unless each of our
nations -- two great nations -- develop and employ new technologies that will reduce their
dependence on oil.... What I want to say today is it is time the U.S. and China not only
recognize the similarity of our oil dependency status, and the direction that competition
may take us, but begin to talk more directly about this growing global competition for oil
so that we can each develop national policies and cooperative international policies --
even joint research and development projects -- to
cut our dependency on oil before the competition becomes truly hostile. The U.S.-China energy engagement that I foresee could be, in one sense,
the 21st Century version of what arms control negotiations with the Soviet Union were in
the last century. But we've got to start those
discussions before the race for oil becomes as hot and dangerous as the nuclear arms race
between the US and the Soviet Union did in the last century.... China's oil consumption surpassed Japan's in 2003. It is now at 6.5
million barrels per day. By 2025, demand, as I said before, is projected to more than
double to more than 14.2 million barrels per day. If we do nothing, the United States
demand for oil by that same year 2025 will increase 8.7 million barrels -- a 40 percent
increase to about 28 million barrels a day. As the authors of the IEA report say -- and
here I quote -- 'we are ending up with 95 percent of
the world relying for its economic well-being on decisions made by five or six countries
in the Middle East'.... The fact is that history
tells us that wars have been fought over such competitions for natural resources. In fact,
as you all know, exactly such a competition is one of the factors that led to Pearl Harbor
and World War II. For the good of our nation and global stability, we've got to lead
America into a new energy age by transforming our transportation system because it is
there that we consume 70 percent of our demand for oil." |
'We Are Going To Need To Think In Completely Different Ways'
".... if you look around and see what
the world is now facing I don't think in the last two or three hundred years we've
faced such a concatonation of problems all at the same time.....[including] the
inevitability, it seems to me, of resource wars.... if we are to solve the issues that are ahead of us, we are going to need to think in completely different ways. And the probability, it seems to me, is that the next 20 or 30 years are
going to see a period of great instability... I fear the [current] era of small wars is
merely the precursor, the pre-shock, for something rather larger to come... we need to
find new ways to be able to live together on an overcrowded earth."
Lord Paddy Ashdown, High Representative for Bosnia and Herzegovina 2002 -2006
BBC
Radio 4, 'Start The Week', 30 April 2007
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"This is Europe's
first commercially operating power station using the Sun's energy this way and at the
moment its operator, Solucar, proudly claims that it generates 11 Megawatts (MW) of
electricity without emitting a single puff of greenhouse gas. This current figure is
enough to power up to 6,000 homes. But ultimately, the entire plant should generate as much power as is used by the 600,000 people of Seville. It works by focusing the reflected rays on one location, turning water
into steam and then blasting it into turbines to generate power..... The vision is of the
sun-blessed lands of the Mediterranean - even the Sahara desert - being carpeted with
systems like this with the power cabled to the drizzlier lands of northern Europe. A
dazzling idea in a dazzling location." |
"The International Energy Agency
called on governments to curb growth in energy demand and greenhouse gases as it warned
Tuesday that the worlds energy supply
is rapidly running out.... 'On current
trends, we are on course for a dirty, expensive and unsustainable energy future,' agency
executive director Claude Mandil said at the reports launch in London. 'In response,
urgent government action is required. The
key word is urgent.'
Worlds energy forecast: Dire
Associated Press,
8 November 2006
No
Solution In Sight? |
Hoon Easily Fooled
"Britain's defense secretary during
the Iraq war says London underestimated Vice
President Dick Cheney's influence, adding another
voice to the growing view that the U.S.-led coalition failed to plan properly for the
aftermath of Saddam Hussein's ouster, a newspaper reported Wednesday.... Hoon said the British side had not comprehended Cheney's influence. Even when Blair and President Bush agreed on some matter, 'sometimes ...
the decision actually came out of a completely
different place. And you think: What did we miss? I
think we missed Cheney,' Hoon was quoted as saying. He did not cite any examples of decisions
apparently reversed by Cheney."
Cheney Iraq role reviewed in Britain
Associated Press, 2
May 2007
"Describing the task of dealing with
the US administration as a 'multi-dimensional jigsaw puzzle,' Mr Hoon accepted that
Britain had greatly underestimated the influence of the neo-con vice-president Mr Cheney and had lacked a
comparable figure able to engage him regularly over the war."
Hoon admits fatal errors in planning for postwar Iraq
Guardian, 2 May 2007
"'Blair
started talking about getting rid of Saddam Hussein way before September 11 ... in 1998. So I think that on Iraq he was
more ready than Bush, who only really came into this conversation after 9/11."
Lady Catherine Meyer, wife of former British US Ambassador, Christopher Meyer
Independent, 20
March 2007
http://www.businessweek.com/ap/financialnews/D8O63NIO0.htm
Report: Gov't needs plan for oil peakWASHINGTON The U.S. government is in need of a strategy to minimize potentially dire economic consequences after worldwide oil production peaks and begins to decline, the investigative arm of Congress said Thursday. Though experts disagree about when daily oil output will reach its maximum level -- or whether they have done so already -- the Government Accountability Office said in a report that most studies have found oil production will reach a peak sometime between now and 2040. The report warns that, as the world's largest oil consumer, the U.S. is vulnerable to significant economic troubles, brought about by rising prices, if a peak arrives and no technology exists to replace petroleum-based transportation fuels. Crude oil prices surged above $66 a barrel Thursday, driven to a new six-month high by concerns that strained relations between Iran and the West could put oil exports in jeopardy. Pump prices kept rising as well: the average U.S. retail price of unleaded regular gasoline was $2.62 a gallon Thursday, 12 cents higher than a year ago, according to AAA. "The consequences of a peak and permanent decline in oil production could be even more prolonged and severe than those of past oil supply shocks," the GAO report said. While the federal government has numerous efforts to forecast oil production and promote alternatives to oil, those efforts are spread across multiple agencies and are not focused explicitly on the "peak oil" problem, the report said. "There is no formal strategy for coordinating and prioritizing federal efforts dealing with peak oil issues," the GAO said. In letters to the GAO, the Energy Department and Interior Department agreed with most aspects of the report. Worldwide consumption of oil reached 84 million barrels per day in 2005 and is projected to reach 118 million barrels per day by 2030, with more than 40 percent of that growth coming from developing countries such as China and India. President Bush, who in his State of the Union address last year said the nation is "addicted to oil," has set a goal of increasing the use of alternative fuels including ethanol to 35 billion gallons a year by 2017 and has held a series of events around the country to promote that effort. The U.S. produced 4.9 billion gallons of ethanol last year, up 33 percent from 2005, according to the Renewable Fuels Association, an industry trade group. By comparison, the country consumes roughly 140 billion gallons of gasoline per year. Production of ethanol from corn alone is expected to reach no more than 12 billion to 15 billion gallons a year, Energy Secretary Samuel Bodman said last month, because of the need to use corn to feed cows, chicken and other livestock. But production of ethanol from plant matter may be commercially viable within five years, the GAO report said. |
Defeat In Iraq Follows Oily Ambitions
"Insurgents in Iraq are right to try
to force US troops out of the country, a former British army commander has said. Gen Sir
Michael Rose also told the BBC's Newsnight programme that the US and the UK must 'admit defeat' and stop
fighting 'a hopeless war' in Iraq. Iraqi insurgents would not give in, he said. 'I don't
excuse them for some of the terrible things they do, but I do understand why they are
resisting.'.... Sir Michael has written a book drawing similarities between the tactics of
insurgents and George Washington's men in America's War of Independence. He told
Newsnight: 'As Lord Chatham said, when he was speaking on the British presence in North
America, he said 'if I was an American, as I am an Englishman, as long as one Englishman
remained on American native soil, I would never, never, never lay down my arms'. 'The
Iraqi insurgents feel exactly the same way.' He said it was time to bring troops home. 'It
is the soldiers who have been telling me from the frontline that the war they have been
fighting is a hopeless war, that they cannot possibly win it and the sooner we start
talking politics and not military solutions, the sooner they will come home and their
lives will be preserved."
Insurgents 'right to take on US'
BBC Online, 3 May 2007
"A top US commander predicted Friday
intensifying fighting and more casualties as US and Iraqi forces move into sanctuaries
used by Al-Qaeda to mount major terror bombings in Baghdad. 'As
we have surged, we find the enemy surging as well,'
said Major General Rick Lynch, who commands an area in central Iraq that wraps around
southern Baghdad. 'We are taking the fight to the enemy to counter his capabilities, but
over time, especially as we continue to put our forces in areas where they have never
operated we can expect to take continued casualties,' he said. Thirteen US soldiers under
Lynch's command were killed and 39 wounded last month, mainly as a result of roadside
bombs, according to the general, who said the number of attacks in his area has
increased."
US commander predicts intensifying fighting, casualties
Agence
France Presse, 4 May 2007
"Four years ago, I watched, with other
young officers, the invasion of Iraq on TV in the mess. We were sick with envy. Our
brother officers were having the most exciting time of their lives, at the centre of
history, while we, on ceremonial duties in London, marched about in red tunics and
bearskin hats. The invasion, it seemed, was a necessary evil to be redeemed by the
creation of a free, democratic Iraq. The WMD issue was a pretext, we all concurred, an
honourable white lie to knock an evil dictator off his perch and breathe new hope into the
lives of a brutally repressed people. Our turn soon came, and the ground truth in Basra
and Maysan provinces was a shock. The statue-toppling euphoria had been replaced by the
horrific chaos of a state in collapse, exacerbated by a rising insurgency and sectarian
bloodshed. The truth gradually emerged. The police and army we were training were corrupt
and probably loyal to the insurgency. The first supposedly democratic elections for half a
century were a façade, dependent on the presence of our Warrior fighting vehicles at
polling stations. Then we realised the issue was not
replacing tyranny with democracy, but gaining long-term access to oil. Blair, in bowing to
American oil-mad energy hunger, had deployed the British Army on a lie, a much bigger lie
than the one about WMDs. Today, the appalling
sectarian violence killing hundreds of Iraqi civilians every week is the direct result of
our invasion and botched occupation. As Blair prepares to leave office, Iraq is descending
into deeper human tragedy, and British troops are still dying....When you join the Army,
you swear allegiance to Her Majesty the Queen and, by extension, the Prime Minister. We
commit ourselves, with unquestioning loyalty, to the State. This is founded on trust in
our political masters, and the belief that they are honourable people who will not lie to
us, will resource us correctly and deploy us with sound judgement, after thorough
strategic planning. This bond is unique, set in stone regardless of party politics. Today,
this bond is broken. Catastrophes in Iraq and Afghanistan and years of resource-starvation
have taken their toll; this is Blair's legacy. Late last year, the head of the Army,
General Sir Richard Dannat, publicly called for our withdrawal from Iraq. Other senior
officers voiced concern. Such public statements, unthinkable before Blair, are a glimpse
of the military's anger and frustration. Of those officers I sat with in the mess four
years ago, many, like me, have left the Army. Those who remain have no trust in the
Government. One told me: 'We won't be fooled again.'"
Leo Docherty: We soldiers once assumed our political bosses would not lie to us. That is
over
Independent, 6
May 2007
(Leo Docherty is author of 'Desert of Death: A Soldier's
Journey from Iraq to Afghanistan', published by Faber and Faber)
Cheney's
Failed Secret Plan
To Delay Global Oil Crisis
"Democratic leaders are using
subpoenas, hearings and other legislative measures to look into the White House's use of
faulty intelligence in 2002 and 2003, including its claim that Iraq sought uranium from Niger for a nuclear program.... 'The country needs to finally have an accounting of how we ended up
in Iraq,' said Rep. Henry Waxman (D., Calif.), whose House Oversight and Government Reform
Committee issued a subpoena to Secretary of State Condoleezza Rice. 'It's a broader
question than one speech or one issue alone. Why was
it that we went to war over false pretenses?'....
The new push is infuriating many Republicans, who say Democrats should focus instead on
finding a constructive solution to the crisis
gripping Iraq, where sectarian violence and terrorist killings are causing mass
dislocations and stifling development in much of the country.... Ms. Rice has so far refused to appear before the panel. She has
argued that her interactions with the president as national-security adviser are off
limits to Congress because of the doctrine of executive privilege. She has offered to
answer the questions in writing -- which Mr. Waxman dismissed as insufficient. Democratic
aides said they will seek a full House vote to find Ms. Rice in contempt of Congress if
she fails to testify.' I don't want a confrontation with her, but a subpoena is not a
request,' Mr. Waxman said. 'It is an insistence.'"
Fresh Fuel for Iraq Debate
Wall
St Journal, 4 May 2007
"We're there because the fact of the
matter is that part of the world controls the world supply of oil, and whoever controls the supply of oil, especially if it were a
man like Saddam Hussein, with a large army and sophisticated weapons, would have a
stranglehold on the American economy and on indeed on the world economy."
Dick Cheney, US Secretary of Defense 1990
New York Times, 24 February 2006
"There are people in Washington ...
who never intend to withdraw military forces from Iraq and they're looking for 10, 20, 50
years in the future ... the reason that we went into Iraq was to
establish a permanent military base in the Gulf region, and I have never heard any of our leaders say that they would commit
themselves to the Iraqi people that 10 years from now there will be no military bases of
the United States in Iraq."
Former President Jimmy Carter, Feb. 3, 2006
San
Francisco Chronicle, 30 April 2007
"The United States may want to keep a long-term military presence in Iraq to bolster moderates against extremists in the region and protect oil supplies,
the army general overseeing US operations in Iraq has said. While the Bush administration
has downplayed prospects for permanent US bases in Iraq, General John Abizaid told a House
of Representatives subcommittee on Tuesday he could not rule that out.... Abizaid cited
the need to fight al-Qaida and other extremists groups and 'the need to be able to deter
ambitions of an expansionistic Iran' as potential reasons to keep
some level of troops in the region in the long term....
'Clearly our long-term vision for a military presence in the region requires a robust counter-terrorist capability,' Abizaid
said.... Abizaid also said the United States and its allies have a vital interest in the oil-rich region. 'Ultimately it comes down to the
free flow of goods and resources on which the prosperity of our own nation and everybody
else in the world depend,' he said....
Representative David Price, a North Carolina Democrat, questioned 'what kind of signal
that sends to the American people and to the Iraqis and the region ... if somehow there is
ambiguity on our ultimate designs in terms of a military presence in Iraq'".
US 'may want to keep Iraq bases'
Reuters, 15 March
2006
"Judicial Watch, the public interest
group that investigates and prosecutes government corruption and abuse, said today that
documents turned over by the Commerce Department, under court order as a result of
Judicial Watchs Freedom of Information Act (FOIA) lawsuit concerning the activities
of the Cheney Energy Task Force, contain a
map of Iraqi oilfields, pipelines, refineries and terminals, as well as 2 charts
detailing Iraqi oil and gas projects, and 'Foreign Suitors for Iraqi Oilfield Contracts.' The documents, which
are dated March 2001, are available on the Internet at: www.JudicialWatch.org. ......Judicial Watch has
been seeking these documents under FOIA since April
19, 2001. Judicial Watch was forced to file a
lawsuit in the U.S. District Court for the District of Columbia (Judicial Watch Inc. v.
Department of Energy, et al., Civil Action No. 01-0981) when the government failed to
comply with the provisions of the FOIA law. U.S. District Court Judge Paul J. Friedman
ordered the government to produce the documents on March 5, 2002."
CHENEY ENERGY TASK FORCE DOCUMENTS FEATURE MAP OF IRAQI OILFIELDS
Judicial Watch, 17 July
2003
"There is to be no withdrawal from
Iraq, just as there has been no withdrawal from hundreds of places around the world that
are outposts of the American empire. As UC San Diego professor emeritus Chalmers Johnson
put it, 'One of the reasons we had no exit plan from Iraq is that we didn't intend to
leave.'... The United States maintains 737 military bases in 130 countries across the
globe. They exist for the purpose of defending the economic interests of the United
States, what is euphemistically called 'national security.' In order to secure favorable
access to Iraq's vast reserves of light crude, the United States is spending billions on
the construction of at least five large permanent military bases throughout that
country.... A new Iraq oil law, largely written by the Coalition Provisional Authority, is
planned for ratification by June. This law cedes control of Iraq's oil to western powers
for 30 years....The attack upon, and subsequent
occupation of, Iraq can be seen as a direct result of the 2001 National Energy Policy
Development Group (better known as vice president Cheney's energy task force) that was
comprised largely of oil and energy company executives. This task force -- the proceedings of which have been kept secret by the
administration on the grounds of 'executive privilege' -- recommended that the U.S. government support initiatives in Middle Eastern
countries 'to open up areas of their energy sector to foreign investment.' As Antonia Juhasz, an analyst with Oil Change International wrote last
month in the New York Times, 'One invasion and a great deal of political engineering by
the Bush administration later, this is exactly what the proposed Iraq oil law would
achieve.'"
Why there was no exit plan
San
Francisco Chronicle, 30 April 2007
"How then will the exploitation of
[energy] sources and the competing demand for products be mediated? That is the most
urgent question raised by the emerging US posture for dealing with Iraqi oil. This is not
a new question, but the most likely answers to it are in the process of taking a sharp
turn. The US is setting the tone by making a military force supported move to preempt
access to Middle Eastern, Caspian and Central Asian energy sources. At the same time,
every major oil-using country is making independent moves to meet its present and future
needs, and all of them are showing up in all the same places with a mix of frock-coated
diplomats, oil experts, and uniformed standard bearers. These developments suggest
the answers to two long unanswered questions about the energy policy of the George W. Bush
administration: Who attended Dick Cheney's Energy
Task Force discussions, and what did they talk about? Without too much risk of being
wrong, you can now answer both questions. The participants in the group mostly represented
the US energy companies that took part in designing the new Iraqi oil law and that are now
working on deals in Central Asia. What they discussed was the plan we now see unfolding in
Baghdad and in various Caspian and Central Asian capitals. The name of the game is to
enhance US and allied control over global energy resources by adding important long-term
new sources of oil and gas. That sounds only prudent
in a situation where the key resources cannot readily be replaced by substitutes. However,
the game presently is being played by zero sum rules. Those rules mean that sooner or
later there will be defined winners and losers. But the global economy is moving toward an
urgent need for cooperative principles for allocating resources. If the game is played
properly, there should only be winners who share the available pool of resources, the
marginal consequences of scarcity, and the costs of adjustment. In the present and
prospective global economy the free market approach, meaning sales to the highest bidders,
is a distortion. Even in a less advanced global system it has led to conflicts, some of
them wars. In the nuclear era such wars can be terminal. Cooperative solutions to this
problem so far only have been discussed. We need to implement them now."
Terrell E. Arnold - What Cheney Energy Task
Force Talked About
EVWorld,
12 April 2007
(Terrel E.Arnold is a retired Senior Foreign Service Officer
of the US Department of State whose immediate pre-retirement positions were as Chairman of
the Department of International Studies of the National War College and as Deputy Director
of the State Office of Counter-Terrorism and Emergency Planning)
"The Bush administration made
plans for war and for Iraq's oil before the 9/11 attacks, sparking a policy battle
between neo-cons and Big Oil, BBC's
Newsnight has revealed..... Two years ago
today - when President George Bush announced US, British and Allied forces would
begin to bomb Baghdad - protesters claimed the US had a secret plan for Iraq's oil once
Saddam had been conquered. In fact there were two conflicting plans, setting off a hidden
policy war between neo-conservatives at the Pentagon, on one side, versus a combination of
'Big Oil' executives and US State Department 'pragmatists'. 'Big Oil' appears to have won.
The latest plan, obtained by Newsnight from the US State Department was, we learned,
drafted with the help of American oil industry consultants. Insiders told Newsnight that planning began 'within
weeks' of Bush's first taking office in 2001,
long before the September 11th attack on the US....The industry-favoured plan was pushed
aside by a secret plan, drafted just
before the invasion in 2003, which called
for the sell-off of all of Iraq's oil fields. The new plan was crafted by neo-conservatives intent on using
Iraq's oil to destroy the Opec cartel through massive increases in production above Opec
quotas. The
sell-off was given the green light in a
secret meeting in London headed by Ahmed
Chalabi shortly after the US entered Baghdad, according to Robert Ebel. Mr Ebel, a former
Energy and CIA oil analyst, now a fellow at the Center for Strategic and International
Studies in Washington, told Newsnight he flew to the London meeting at the request of the
State Department.....Philip Carroll, the former CEO of Shell Oil USA who took control of
Iraq's oil production for the US Government a month after the invasion, stalled the
sell-off scheme.... Ariel Cohen, of the neo-conservative Heritage Foundation,
told Newsnight that an opportunity had been missed to privatise Iraq's oil fields..... New
plans, obtained from the State Department by Newsnight and Harper's Magazine under the US
Freedom of Information Act, called for creation of a state-owned oil company favoured by
the US oil industry. It was completed in January 2004 under the guidance of Amy Jaffe of
the James Baker Institute in Texas. Formerly US Secretary of State, Baker is now an
attorney representing Exxon-Mobil and the Saudi Arabian government.... "
Secret US plans for Iraq's oil
BBC News, 17 March 2005
Duh... Hoon Buffoon Didn't Get It
"Britain's defense secretary during
the Iraq war says London underestimated Vice
President Dick Cheney's influence, adding another
voice to the growing view that the U.S.-led coalition failed to plan properly for the
aftermath of Saddam Hussein's ouster, a newspaper reported Wednesday.... Hoon said the British side had not comprehended Cheney's influence. Even when Blair and President Bush agreed on some matter, 'sometimes ...
the decision actually came out of a completely
different place. And you think: What did we miss? I
think we missed Cheney,' Hoon was quoted as saying. He did not cite any examples of decisions
apparently reversed by Cheney."
Cheney Iraq role reviewed in Britain
Associated Press, 2
May 2007
"Describing the task of dealing with
the US administration as a 'multi-dimensional jigsaw puzzle,' Mr Hoon accepted that
Britain had greatly underestimated the influence of
the neo-con vice-president Mr Cheney and had lacked
a comparable figure able to engage him regularly over the war."
Hoon admits fatal errors in planning for postwar Iraq
Guardian, 2 May 2007
"'
Blair started talking about getting rid of Saddam Hussein way before September 11 ... in 1998. So I think that on Iraq he was more ready than Bush, who only really came into this conversation after 9/11."Iraq Is The Most Substantially Undeveloped Conventional Oil Province Left In The World
"The super-giant fields of southeastern Iraq are the largest concentration of super-giants to be found anywhere in the world....unlike neighbor Saudi Arabia, Iraq has been unable to deploy the latest technology, such as 3-D seismic, to find its reserves. Present reserve estimates of Iraq's oil are based on 2-D seismic technology from the 1980s. Still, the estimated success rate in Iraq ranges from one in two in the Mesopotamian Basin to one in four in the western and northwestern stable platform, with the overall success rate exceeding 72 percent -
perhaps the highest success rate achievable anywhere in the world. Oil exploration costs are among the cheapest globally, with the current cost estimated at around 50 cents per barrel....To date, petroleum geologists have delineated and mapped over 526 prospects - drilling 131 prospects to discover 73 major fields. They have identified some 239 as having a high degree of certainty, but those prospects remain undrilled. Thirty fields have been partially developed and only 12 fields are actually onstream. Undrilled structures and undeveloped fields could represent the largest untapped hydrocarbon resource anywhere in the world.....Clearly, large parts of Iraq are still virgin - its large hydrocarbon reserves are still waiting to be developed to their full potential, while most other Middle East countries are fully exploiting their reserves. The main challenges facing the new Iraqi authority are to establish law and order as well as security. Once these issues are resolved, Iraq will perhaps be the most exciting place on Earth with regard to oil development and exploration....International oil companies are looking forward with great anticipation to the opening of Iraq, as they have been waiting for the past 40 years. Hopefully, Iraq will soon be able to offer them acreage, thereby allowing proper development of its huge potential. Open and fair competition will enable oil companies to apply the latest technologies in the search for, and development of, the country's hydrocarbon resources - thus helping Iraq realize its full hydrocarbon potential.""Iraq's oil reserves are significantly
untapped and daily production could be doubled within five years, a report has
concluded.... If these reserves were exploited, it said, Iraq could overtake Saudi Arabia
as the world's top oil producer. But a major improvement in security and investment was
needed, it added.... The IHS survey, which examined Iraq's oil reserves both before and
after the overthrow of Saddam Hussein, is the most comprehensive conducted since the 2003
invasion. It found that Iraq had known reserves of 116 billion barrels and could be sitting on a further 100 billion barrels.... Current output of two million barrels a day is lower than in early
2003, when three million barrels were being pumped, and almost half that being produced in
1979. However, it said Iraq had the capacity to increase production to four million
barrels by 2012 and to further increase that to six million within time. 'Iraq's reserves are clearly phenomenal,' said Ron Mobed, president and chief operating officer of IHS, adding that
they represented a 'gold star opportunity'."
Iraqi oil wealth 'going untapped'
BBC Online, 19 April 2007
Washington Has Long Known That An Oil Crunch Is Coming
Center for Strategic and
International Studies The Changing
Geopolitics of Energy Part I August 12, 1998 · Oil and gas energy use rises by 75% in BTUs between 1997 and 2020. · Industrialized world and US become steadily more dependent on · Demand from the industrialized world, however, no longer · Asia will become the dominant consuming region by 2010. · Asias Imports will increase accordingly. · China is actively competing in the "Great Game" for · .The
Middle East and the Gulf are projected to dominate · The
growing domestic demand for oil in other developing · Pipeline,
port, and tanker geopolitics will change fundamentally · Iran, Iraq, Libya, and Russia represent "high risk" oil
suppliers
|
"Optimists about world oil reserves,
such as the Department of Energy, are getting increasingly lonely. The International Energy Agency now says that world production
outside the Middle Eastern Organization of Petroleum Exporting Countries (opec) will peak
in 1999 and world production overall will peak between 2010 and 2020. This projection is supported by influential recent articles in Science
and Scientific American. Some knowledgeable academic and industry voices put the date that
world production will peak even soonerwithin the next five or six years. The
optimists who project large reserve quantities of over one trillion barrels tend to base
their numbers on one of three things: inclusion of heavy oil and tar sands, the
exploitation of which will entail huge economic and environmental costs; puffery by opec
nations lobbying for higher production quotas within the cartel; or assumptions about new
drilling technologies that may accelerate production but are unlikely to expand reserves.
Once production peaks, even though exhaustion of world reserves will still be many years
away, prices will begin to rise sharply. This trend will be exacerbated by increased
demand in the developing world..... The
recent report by the President's Committee of Advisers on Science and Technology... concluded 'A plausible argument can be
made that the security of the United States is at least as likely to be imperiled in the
first half of the next century by the consequences of inadequacies in the energy options
available to the world as by inadequacies in the capabilities of U.S. weapons systems.
It is striking that the Federal government spends about 20 times more R&D money
on the latter problem than on the former.'... The nearly $70 billion spent annually for
imported oil represents about 40 percent of the current U.S. trade deficit.... Research is
essential to produce the innovations and technical improvements that will lower the
production costs of ethanol and other renewable fuels and let them compete directly with
gasoline. At present, the United States is not funding a vigorous program in renewable
technologies.... The United States cannot afford to wait for the next energy crisis to
marshal its intellectual and industrial resources....Our growing dependence on
increasingly scarce Middle Eastern oil is a fool's gamethere is no way for the rest
of the world to win. Our losses may come suddenly through war, steadily through price
increases, agonizingly through developing-nation poverty, relentlessly through climate
changeor through all of the above."
Senator Richard G. Lugar and R. James Woolsey (Former Director of the CIA)
The New Petroleum - Foreign Affairs January/February 1999
"Our industry can certainly be proud
of its past achievements. Yet the challenges we will face in the coming years will be
every bit as great as those encountered in the past, due in part to ever-increasing global
energy use. For example, we estimate that world oil and gas production from existing
fields is declining at an average rate of about 4 to 6 percent a year. To meet projected
demand in 2015, the industry will have to add about 100 million oil-equivalent barrels a
day of new production. That's equal to about 80 percent of today's production level. In other words, by
2015, we will need to find, develop and produce a volume of new oil and gas that is equal
to eight out of every 10 barrels being produced today."
John Thompson, President of ExxonMobil Exploration
The
Lamp (published for ExxonMobil shareholders), 2003, Vol. 85 No.1
"After years of work on peak oil, it
is rare for me to find a book written for the general public that can teach me something I
didnt know before. But with David Strahans book, 'The Last Oil Shock,' it was a different matter.
While I often just thumb through this kind of books, this one was worth reading carefully,
line by line. Books on peak oil, so far, have been written mostly by geologists, and in
general by scientists. Their approach is normally rather impersonal and is based on the
analysis of literature data. Strahans approach, instead, is that of the
investigative journalist and it is based on interviews. The result is lively and rich in
insights. For instance, Strahan manages to make a
convincing case that the people in power know much more about peak oil than they care to
tell to us, the poor petroleum peasants. Maybe you
suspected that already, but Strahan will give you much food for thought on the
matter."
The Last Oil Shock - book review
ASPO-Italy, 15 April 2007
Including Dick Cheney
"For the world
as a whole, oil companies are expected to keep finding and developing enough oil to offset
our seventy one million plus barrel a day of oil depletion, but also to meet new demand. By some estimates there will be an average of two
per cent annual growth in global oil demand over the years ahead along with conservatively
a three per cent natural decline in production from existing reserves. That means by 2010 we will need on the
order of an additional fifty million barrels a day. So where is the oil going to come from?
Governments and the national oil companies are obviously in control of about ninety per
cent of the assets. Oil remains fundamentally a government business. While many regions of
the world offer great oil opportunities, the Middle East with two thirds of the world's
oil and the lowest cost, is
still where the prize ultimately lies, even though companies are anxious for greater access there, progress
continues to be slow."
Dick Cheney, Chief Executive of Halliburton,
now Vice President of the United States
Speech at London
Institute of Petroleum, Autumn Lunch 1999
But Cheney's Iraq Project Has Failed
"On March 27, 2003, Paul Wolfowitz,
then deputy secretary of defense, predicted that Iraq's oil revenue would 'finance' its
reconstruction and do so 'relatively soon.'....According to State Department figures, production has been stagnant at 2.1 million barrels per day, or
400,000 barrels per day below the immediate prewar peak (which was matched for a few months in 2004)."
Oil's Not Well in Iraq
The Weekly
Standard, 10 February 2007
"The global market will need increasing volumes of oil from members of the Organisation of Petroleum Exporting Countries after non-OPEC production reaches a maximum of about 50 million b/d between 2007 and 2011... A question crucial to future oil supply, therefore is: Can OPEC's old fields deliver.... Most of the supergiant oil fields have had water or gas injection installed to maintain pressure for 20-30 years. Handling produced injection fluids is a growing problem in Iran, Saudi Arabia, the UAE, and in older fields in
Iraq (Kirkuk, Zubair, and Rumailah).... The oil fields of Iraq are the least depleted and least developed of any of the Persian Gulf oil producing countries, and Iraq has the potential to rapidly increase oil output.... Combined with earlier results, these predictions for OPEC yield an estimate of the world's ultimate recoverable oil reserves of 2.5-2.9 trillion bbl, with 1.29-1.66 trillion bbl remaining (1.224 trillion bbl produced to end 2003)..... It seems unlikely that OPEC can increase production at the rate that was possible in the 1960s and 1970s, when the fields were fresh and initial well production rates were higher... Only Iraq has undeveloped supergiant oil fields (West Qurna, Majnoon, and East Baghdad) and the potential to rapidly increase production to 8-10 million b/d...... The five Persian Gulf countries (Saudi Arabia, Iraq, Iran, Kuwait and the UAE) are crucial to raising OPEC production. The political situation in Iraq is unlikely to be conducive to major investment in new oil production capacity for some years. Saudi Arabia has serious internal problems, which threaten to destabilize the ruling royal family. Iran remains under unilateral US sanctions. US military intervention in the Gulf and its failure to effectively and fairly engage in resolving the Palestinian-Israeli conflict conspire to provide a hostile backdrop to western interests in the Middle East. The combination of burgeoning future oil revenues and growing hostility to the US in the region is not conducive to major capacity expansion and will not provide a stable investment environment or offer easy opportunities to the major international oil companies to assist in any capacity expansion projects. Based on these considerations and the maturity of OPECs major fields, it seems more likely that OPECs considerable reserves will be expressed as a long plateau rather than a sharp peak. It is quite possible that the Persian Gulf countries will not raise production capacity high enough or quickly enough, either for political reasons, the slowness of internal decision-making, or the hostile security environment. The consequences of this for world oil supply are immense, with the likelihood of further military interventions and conflicts within the Middle East .. It is unlikely, except in the high reserves case, that OPEC production will be able to meet the high demand forecast of 121 million b/d for 2025 by the US Energy Information Administration. OPEC is able to meet mid-demand growth (1.5%) until 2013-15 if OPECs oil reserves are low or until 2017-20 if OPECs reserves are high. OPEC is able to meet low-demand growth (about 1%/year) until 2020 under either reserves scenario. These forecasts suggest world oil demand is likely to be dampened by a rising oil price due to supply constraints, particularly after non-OPEC production peaks (2007-11), but also when OPEC production increases start to tail off. This could occur in 2010-15 if OPECs reserves turn out to be low or around 2015-20 if OPECs reserves are high. Oil supply will become increasingly concentrated in the Middle East and the former Soviet Union. The proportion of oil production from the main producers of the Persian Gulf (Iran, Iraq, Saudi Arabia, Kuwait, and the UAE) is forecast to rise to 45% in 2025 from 25% in 2003. Just seven countries Russia, Iran, Iraq, Saudi Arabia, Kuwait, and the UAE and Venezuela are expected to make up more than 60% of world oil production in 2025. For the range of oil reserves demand scenarios considered here, world oil supply is predicted to peak at 90-105 million b/d between 2016 and 2028 Based on these results, the EIA forecast of world demand of more than 120 million b/d in 2025 seems unlikely to be met by production .. Total world oil reserves are estimated at 2.5 2.9 trillion bbl. The world has consumed 1.224 trillion bbl to the end of 2004, so remaining reserves are estimated at 1.3-1.7 trillion bbl (Table 1).As the different components of supply reach their maximum production rate, a series of crises in oil supply is likely over the coming decades. The first, related to the peak and decline of non-OPEC production, is practically upon us and underpins the currently high oil prices. Other factors are burgeoning world oil demand, driven primarily by China and the USA, and restricted output from Iraq. The imminent inability of non-OPEC production to meet incremental demand and its decline after 2010 precipitates the second crisis as OPECs diminishing spare capacity (even with Iraqs production back to preinvasion levels) becomes less and less able to accommodate short-term fluctuations. The timing and depth of the crisis depend on world oil demand and OPEC investment in new capacity. While OPEC countries will have every incentive to make the necessary investments, the pace of past decision-making is not encouraging, and enough spare capacity may not be available in time. The third crisis, due to OPECs incremental supply being unable to meet incremental demand, follows in the first half of the next decade. This assumes that OPECs reserves are as published. If OPECs reserves are higher than published, this crisis may not occur until the latter half of the next decade and may be muted, particularly if demand moderates. These crises will have global economic and geopolitical significance: The oil price will be high and volatile, and demand growth will have to be curtailed..."However Desperate Dick Isn't Done Yet With His Criminal Scheming
"Q: And what are the stakes
here? The diplomatic effort has been going on for a long time and it has not worked. In
fact, Iran has gone in the other direction. So what are the stakes here? |
"The US would also have even less
justification under international law for such an
attack on Iran than it had over Iraq. The UN
security council would never authorise it because Iran has not breached the terms of the
nuclear Non-Proliferation Treaty.
Nor can the US or Israel claim they had the right to a pre-emptive strike. By
long-established law, a pre-emptive strike is justified only to defend against an
'imminent and certain' attack. To claim the right of self-defence against a threat that
may or may not emerge in 5 years' time is to claim the right to wage aggressive war
whenever one chooses. It is worth recalling that that was one of the two grounds on which
Nazi leaders were convicted and executed at Nuremburg. The truth is, Iran has done nothing
illegal. It has demonstrated no territorial ambitions and has not occupied any foreign
country - unlike the US, Britain and Israel. It has complied with its obligations under
the NPT to allow inspectors 'to go anywhere and see anything' - unlike the US and Israel
which refuse this. Indeed, by comparison, Israel has refused to recognise the NPT, and
holds between 200-500 thermonuclear weapons targeted at Iran and other Middle East
countries. Nor do any of the West's arguments for war against Iran hold water. It is said
repeatedly that Iran is about to produce a nuclear bomb, and cannot be allowed to do so.
In fact, Iran is not about to produce a bomb or anywhere near it. Iran is believed to have
enriched uranium to the 3.5% level, enough for use as nuclear fuel, but it would require
90% enrichment, with 50-100 kg of it, to make a single bomb. As to the argument that Iran
should not be allowed to have nuclear weapons, who decides that? What right does the US
have to decide who should or should not have nuclear weapons? ..... So why, against all this background, is the US so bent on
attacking Iran? Two considerations are probably
decisive. One is that President Bush clearly sees his role in the Middle East in messianic
terms and will not let does-not-make-sense arguments stand in the way of what he regards
as his manifest destiny. The other is oil. Iran holds
the world's largest supplies of oil after Saudi Arabia and Iraq, and holds more oil and
gas combined than any other country on the planet. As Peak Oil rapidly approaches, the US
demand to control the lion's share of what is left - pitifully short-sighted though such a
policy is - is now the dominant driving geopolitical force in world politics today."
Michael Meacher - A war down memory lane
Gardian,
Comment Is Free, 11 January 2007
Guardian - Comment Is
Free [extracts]The rape of Iraq's oilThe Baghdad government has caved in to a damaging plan that will enrich western companies. March 22, 2007 1:30 PM | Printable version The recent cabinet agreement in Baghdad on the new draft oil law was hailed as a landmark deal bringing together the warring factions in the allocation of the country's oil wealth. What was concealed was that this is being forced through by relentless pressure from the US and will sow the seeds of intense future conflict, with serious knock-on impacts on the world economy. The draft law, now before the Iraqi parliament, sets up "production sharing partnerships" to allow the US and British oil majors to extract Iraqi oil for up to 30 years. While Iraq would retain legal ownership of its oil, companies like Exxon, Chevron, Shell and BP that invest in the infrastructure and refineries would get a large share of the profits. No other Middle Eastern oil producer has ever offered such a hugely lucrative concession to the big oil companies, since Opec has always run its oil business through tightly-controlled state companies. Only Iraq in its present dire condition, dependent on US troops for the survival of the government, lacks the bargaining capacity to resist. This is not a new plan. According to documents obtained from the US State Department by BBC Newsnight under the US Freedom of Information Act, the US oil industry plan drafted early in 2001 for takeover of the Iraqi oilfields (after the removal of Saddam) was pushed aside by a secret plan, drafted just before the invasion in 2003, calling for the sell-off of all of Iraq's oilfields. This secret plan was crafted by neo-conservatives intent on using Iraq's oil to destroy the Opec cartel through massive increases in production above Opec quotas. However, Philip Carroll, the former CEO of Shell Oil USA, who took control of Iraq's oil production for the US government a month after the invasion, stalled the sell-off scheme. As Ariel Cohen of the neo-conservative Heritage Foundation later told Newsnight, an opportunity had been missed to privatise Iraq's oilfields. Now the plan is being revisited, or as much of it as can be salvaged after the fading of American power on the battlefield made enforced sell-off impossible. This revision of the original plan has been drafted by BearingPoint, a US consultancy firm, at the request of the US government. Significantly, it was checked first with Big Oil and the IMF and is only now being presented to the Iraqi parliament. But if accepted by the Iraqis under intense pressure, it will lock the country into weakness and dependence for decades. The neo-cons may have lost the war, but they are still manipulating to win the most substantial chunk of the peace when and if it ever comes.... ....in neo-conservative eyes Iraq was also required as an alternative to Saudi Arabia to provide a military base for the US to police the whole of Gulf oil. It was no longer possible for the US to maintain troops in Saudi Arabia for that purpose without risking the collapse of the dictatorial Saudi regime and its giant oil assets falling into the hands of Islamic extremists. The removal of US troops from Saudi Arabia was the principal demand contained in Osama bin Laden's fatwa of 1996. This was why, shortly after invading Iraq, the US announced that it was pulling its combat troops out of Saudi Arabia, thereby meeting Bin Laden's principal pre-9/11 political demand. But unfortunately for the US, al-Qaida is now seeking the removal of US troops from Iraq as well. Above all, the policy is flawed by its extreme short-sightedness. Even if the US were to win its war in Iraq, which now looks virtually impossible, its incremental gain before the oil runs out would be short-term, while its exposure to intensified and unending insurgency because of perceived US seizure of Iraqi oil rights, especially if extended to Iran, would be disproportionately enormous both in the Middle East and maybe also at home. It is diametrically the opposite of the policy to which the whole world will be forced ineluctably by the accelerating onset of climate change. Perhaps the single greatest gain of the west learning this lesson of weaning itself off its oil addiction is that it would end this interference in the internal affairs of Muslim countries simply because they happen to have oil - the central cause of world conflict today. |
'The Final Frontier'
Shell And Major Candian Bank Say
Conventional Oil Production Has Already Peaked"My view is that 'easy' oil has probably passed its peak."
Jeroen van der Veer, CEO of Royal Dutch Shell
Financial Times, 24 January 2006About: 'CIBC World Markets is the wholesale banking arm of the Canadian Imperial Bank of Commerce (CIBC), one of North America's first and largest financial institutions.'
Note: This CIBC Analysis Projects That Global Oil Supply Will
Reach Only Just Over 88 Million Barrels Per Day By 2010
However A Recent Forecast From The IEA Is That Global Demand Will Reach Over 93 Million By 2010
CIBC World Markets - Monthly
Indicators The Final Frontier .... Canada can thank depletion of conventional crude reserves for its newfound importancein global energy markets.....And, theres no doubt about it, its oil sands, and equally expensive and challenging deepwater wells, where future production will come from. Despite soaring crude prices, conventional oil capacity dropped in 2005 for the first time in history and will continue to decline for the foreseeable future. All of the projected 3 million barrel-per-day increase in world production between now and the end of the decade will come from non-conventional sources (see pages 4-5). While still very much a junior partner to deepwater oil now, an expected one million barrel-per-day increase in Canadian oil sands production by decades end will make it the single largest source of new global supply....High-Cost Oil Sands and Deep-Water Fields Will Drive Future Supply Growth
|
But What Happens After 2010?
CIBC Doesn't Say Although Its Production Graph Is Clearly Flattening Out Around
Then
The
Editor Of Petroleum Review Forecasts Total Peak In 2011 Including Unconventionals At
Around 94 Million Barrels Per Day
BBC
Why 'Peak Oil' Is A Major Threat To Climate Change
"After years of work on peak oil, it
is rare for me to find a book written for the general public that can teach me something I
didnt know before. But with David Strahans book, 'The Last Oil Shock,' it was a different matter.
While I often just thumb through this kind of books, this one was worth reading carefully,
line by line. Books on peak oil, so far, have been written mostly by geologists, and in
general by scientists. Their approach is normally rather impersonal and is based on the
analysis of literature data. Strahans approach, instead, is that of the
investigative journalist and it is based on interviews. The result is lively and rich in
insights. For instance, Strahan manages to make a convincing case that the people in power
know much more about peak oil than they care to tell to us, the poor petroleum peasants.
Maybe you suspected that already, but Strahan will give you much food for thought on the
matter."
The Last Oil Shock - book review
ASPO-Italy, 15 April 2007
| BBC Online, 29 March 2007 http://news.bbc.co.uk/1/hi/sci/tech/6505127.stm End of oil heralds climate pain
Many people think that running out of oil, or "peak oil", would be good for the climate. In his new book The Last Oil Shock, David Strahan begs to differ; he suggests it may bring catastrophe. It is becoming increasingly clear that global oil production will soon go into terminal decline, with potentially devastating economic consequences. Although the idea of peak oil has traditionally been ridiculed by the industry, now even some of the world's most senior oilmen concede the case. Last year Thierry Desmarest, chairman of Total, the world's fourth largest oil company, declared that production would peak by around 2020. He urged governments to find ways to suppress oil demand growth and put off the witching hour. Other forecasters are convinced the peak date is even closer. But many environmentalists continue to resist the idea. Some seem to suspect that anybody who argues that oil production is set to fall must be a closet climate change denier with a secret agenda.
Others, like Stephen Tindale of Greenpeace, instinctively distrust forecasts of an imminent peak, but wish fervently that it would come soon. "Let's hope that the oil does run out", he told me, "and that the world has to develop alternatives to oil seriously quickly, and from a climate point of view that would be an excellent outcome." Neither position could be more wrong. Dirty growth It is mathematically impossible that peak oil will solve climate change. Although oil is the biggest single source of energy-related greenhouse gases, coal and gas combined are bigger still, and the expected growth in their emissions would overwhelm any reduction from oil. As I demonstrate in The Last Oil Shock using the International Energy Agency's "business-as-usual" forecast, even if oil production peaks in 2010 and immediately starts to fall at 3% a year, total emissions would still rise by 25%, reaching 32 billion tonnes in 2030. Yet by that time, we need to be well on the way to at least a 60% cut in emissions.
So it is quite possible to run out of oil and pollute the planet to destruction simultaneously. In fact peak oil could even make emissions worse if it drives us to exploit the wrong kinds of fuel. Burning rainforest and peatlands to create palm oil plantations for biofuels releases vast amounts of CO2, and has already made Indonesia, according to some ways of calculating it, the world's third biggest emitter after the US and China. Synthetic transport fuels made from natural gas using the Fischer-Tropsch process emit even more carbon on a well-to-wheels basis than conventional crude; and when the feedstock is coal, the emissions double. None of these alternatives are likely to fill the gap left by conventional crude - at least, not in time. But because they are so much more carbon intensive, it is quite easy to conjure scenarios in which we still suffer fuel shortages while emitting even more CO2 than in the current business-as-usual forecast - the worst of all possible worlds. Land fill Although these fuels are likely to prove inadequate, we may be driven to use them because cleaner alternatives are even more inadequate, for a variety of reasons. Biofuels can be produced sustainably and with real CO2 reductions, but in the industrialised world there simply isn't the land. In the developing world, however, there are vast swathes of land which could be put to sugar cane in a sustainable fashion; but the scale of the task of replacing crude oil would still be monumental. I calculate that to substitute the fuel lost through a post-peak oil production annual decline of 3% would mean planting about 200,000 sq km - equivalent to the land area of Cuba, Sri Lanka and Papua New Guinea - every year. Alternatively, if we decided to run Britain's road transport system, say, on cleanly produced hydrogen - electrolysing water using non-CO2-emitting forms of generation - our options would be:
Price sores When oil production starts to fall, the economic impacts could well be devastating. Soaring crude prices could tip the world into a depression deeper than that of the 1930s, and collapsing stock markets cripple our ability to finance the expensive clean energy infrastructure we need. As the unemployment lines grow, the political will to tackle climate change may be sapped by the need to keep the lights burning as cheaply as possible. Many environmentalists seem to dismiss or ignore peak oil because they simply cannot see it as significant when compared to climate change. But this is to miss the point. Oil depletion is deadly serious in its own right, but it also has the capacity both to worsen emissions and destroy the wealth needed to fight global warming. For this reason - among others - it too has the power to destroy our civilisation. David Strahan is an investigative journalist and documentary film-maker The Green Room is a series of opinion articles on environmental issues running weekly on the BBC news website A series of thought-provoking environmental opinion pieces |
What Do Tar Sands Mean
For Global Energy Supply And Global Warming?
"Alberta's oil sands will become the
most important source of new oil in the world by 2010 as
conventional crude dries up, CIBC World Markets says
in its latest monthly report. Alberta will sit on one of the most valuable energy sources
in the world by that time, and one of the few still open to private investment, said Jeff
Rubin, chief economist at CIBC World Markets, the bank's wholesale banking arm. He added
that conventional oil production around the world
apparently peaked in 2004. Rubin found that total
oil supplies around the world grew by less than one million barrels a day last year. None
of that growth came from outside the OPEC sphere. ... Rubin looked at 164 upcoming oil
fields in his study and found that new oil is, in fact, being discovered and it is coming
on stream. But more than half simply balances declining production from existing fields in
the North Sea and Kuwait's Burgan region. Rubin does expect a net gain in oil production
in coming years, but it will be small and getting smaller. Rubin expects 3.6 million
barrels of new oil to come on stream in 2006, but 2.2 million barrels will go to replace
declining reserves elsewhere, leaving just 1.4 million barrels of new oil. He expects 1.5
million barrels of new oil in 2006 and 2007, but less than a million barrels a day in
2008. Energy companies are finding new oil, but most of it will come from non-conventional
sources. Ocean oil rigs are the primary source of new
oil today, with Alberta's oil sands tomorrow, with
expansion projects rivaling those of Saudi Arabia. Suncor Energy Inc. and its predecessor,
Great Canadian Oil Sands, have been developing the oil sands near Fort McMurray in
northern Alberta since 1963. But the project was hobbled by the difficulties and expense
of extracting crude oil from what is essentially a oily sand."
Alberta oil sands to star now we're post-peak: CIBC World Markets
CBC News, 11 January 2007
Too Little Oil To Come From Oil
Sands?
Expanding Oil Sand Production Is Likely To Be A Struggle
"The answer to America's oil addiction
lies in Canada. Or so goes one line of thinking. As oil supplies got tighter and crude
prices soared over the last few years, tens of billions of dollars flowed into an effort
to develop the biggest oil reserve outside Saudi Arabia: Alberta's
oil sands. Along with the development rush have come rosy predictions on how much this
secure, close, proven supply of oil might yield. Four million, 6 million, even 10 million
barrels a day, which is nearly half America's total daily consumption and would easily
replace all imports from the Middle East. The only
thing is, those numbers may be far too high."
Curing oil sands fever
CNN,
7 October 2006
"Global
oil demand growth is seen rising 2% annually through 2011, the International Energy Agency
said Tuesday, in a forecast that is more optimistic about the rate of future energy
consumption compared with previous five-year periods, because of rapid growth in Asia.
World oil consumption growth is expected to rise on average by 1.8 million barrels a day
over the five-year period, from 84.5 million barrels a day in 2006 to 93.3 million barrels a day in 2011, the Paris-based IEA forecast in its medium-term report for 2006-2011.
The 2% annually growth rate in consumption compares with growth of 1.8% in 2001-2006, and
1.4% in the 1996-2001 period.... oil producing nations and international oil companies
need to continue to sink money into new capacity over the next several years. The IEA said
Chinese oil consumption growth is expected to rise annually by 5.7%, more three times the
oil demand growth pace in the U.S., while Middle East countries as a whole will use oil at
an average annual rate of 4.9%."
IEA: 2006-2011 Global Oil Demand Growth Seen Rising 2% a Year
Dow Jones Newswires, 6
February 2007
Or Too Much?
What The Expansion Of Oil Sands Production Would Mean For Climate Change
"Other new hydrocarbon energy frontiers include heavy oils and where oil is contained in sand and shales... But they are more carbon-intensive and increase the urgency of finding ways of tackling carbon emissions...."
Jeroen van der Veer, CEO of Royal Dutch Shell
Financial Times, 24 January 2006
"Whilst it has taken 145
years to consume half of the 2-2½ trillion barrels of conventional oil supplies generally
regarded as the total available, it is likely that, given the huge increases in demand
from China and India, with rates of growth of 7pc-10pc a year in economies supplying
two-fifths of the world population, the other half will be largely consumed within the
next 40 years. The significance of this can hardly be over-stated. Oil is the fundamental
underpinning of our civilization. Alternatives like biofuels, ethanol or biomass can play
a marginal supportive role but nowhere near on the scale required.... Some 98pc of global
crude oil comes from 45 nations, of which more than half may have peaked in oil
production, including seven of the 11 Opec nations.Major oil field discoveries fell to
zero for the first time in 2003. Worse still, the excess capacity held by Opec nations has
dwindled, from an average of 30pc to about 1pc of global demand now. The political
significance of this is almost incalculable. World oil and gas production is declining at
an average of 4pc-6pc a year, while demand is growing at 2pc-3pc a year.... Global oil
production is 84m barrels a day. As the president of Exxon Mobil Exploration, John
Thompson, said in 2003: 'By 2015 we will need to find, develop and produce a volume of new
oil and gas that is equal to eight out of every 10 barrels being produced today.' That is
not just a problem of better technology. Additional oil on that scale is not available.
There are three options to escape this dilemma. One, which the US is ruthlessly pursuing,
is to grab by force of arms the lion's share of what remains. A
second is to shift into unconventional sources of oil - tar sands, extra heavy oils and
gas to liquids processing. A third is to accelerate
the switch out of oil altogether into renewable sources of energy, especially wind power,
biomass, tidal power and solar. What is so disturbing is that long-term global
policymaking on this, perhaps the biggest decision this century, is virtually non-existent
and driven instead by self-destructive short-termism. The first option was the real reason
behind the first Gulf War in 1991, to deter
Saddam gaining control of the Saudi oilfields. It was also a major reason for the orchestrated revolutions in Ukraine, Georgia and Kyrgyzstan, as well as the military interventions in Afghanistan and Yugoslavia, all of which offer key oil transit
routes from the Caspian Sea Basin, which holds the world's biggest untapped fossil fuel
resources, worth up to $5 trillion. Equally it is also one major reason for Russian intervention in Chechnya, part of the northerly
transit route between the Caspian and Black Sea under current Russian control. It is
certainly another reason for US concern about Iran, holding only slightly lower oil
reserves than Iraq. But, above all, option one was the main trigger
for the Iraq war. Of more than 80 oilfields discovered in Iraq, only about 21 have
been at least partly developed. Despite this, Iraq's proven oil reserves exceed 110bn
barrels but its total reserves are likely to be far more, perhaps even 200bn barrels more.
This explains US determination to control this fulcrum but it has involved an escalating
political, military and economic price that must make this option unsupportable even for
the US. An alternative strategy is to take advantage of the rising oil price to develop unconventional oil sources, notably the Athabascan tar
sands in Canada and the Venezuelan Orinoco heavy oils.
However, the downsides in terms of cost, manpower,
water shortages and, above all, CO2, are prohibitive.
Cost-wise, the International Energy Agency reckons that investment needed in oil and gas
over the next 25 years to meet an expected 50pc increase in global demand, will be $5
trillion, equivalent to more than four times the entire GNP of the UK. The biggest
constraint, however, is environmental. It takes almost as much energy to mine, process,
refine and upgrade the oil extracted from tar sand as the energy contained in the light
oil produced. Worse still, the processing releases five to 10 times more greenhouse gases than a barrel of conventional oil. This is the exact opposite to the
scientists' requirement for the world to cut greenhouse gas emissions by at least 60pc by
2050. The third option is clearly the right way
forward - a new energy world order. The potential for powering the world economy via
renewables is almost infinite. Governments should now be switching to this option, far
faster and on a far greater scale."
Michael Meacher - Former Blair Minister
Our only hope lies in forging a new energy world order
Daily
Telegraph, 26 June 2006
But This Is How Tough It Is Getting
The Fantasy Nuclear Tar Sands 'Solution'
"Nuclear companies and those mining Canada's
oil sands are poised to team up to separate crude from deep Earth and pump it to the
surface. Reactors are being pushed as a more
economical and environmentally friendly alternative to the natural gas now used to fuel
oil-sands projects, but the stigma of nuclear energy
-- and its ability to do the job -- remain an obstacle. The high price of crude makes oil
sands attractive to develop, a process where hydrocarbons mixed with sand, water and clay
over millions of years and under the Earth's pressure are extracted, separated, refined to
a synthetic oil and sent to market. 'It's quite energy intensive,' Jeffrey Collins,
director of Global Oil for Cambridge Energy Research Associates, told United Press
International. 'There is still a strong gain positively in terms of the amount of energy
you're able to get out of it versus the energy you use.' Canada is the world's
seventh-largest oil producer at 3.1 million barrels per day and the No. 1 supplier for the
United States. Most of Canada's production is from conventional crude, but 'the vast
majority of Canada's reserves are actually in oil sands' in an area the size of Florida,
Collins said. More than 1 million bpd of Canada's oil is from sands. That could triple in
10 years. But as sands production increases, so does
its demand for energy, mostly supplied by natural gas. The Energy Information Administration, the data arm of the U.S. Energy
Department, predicts demand for natural gas in North America alone will increase by 1.1 a
year through 2030. Canada's appetite jumped 1.9 percent in 2003. Canada's reserves are the
17th-largest in the world, but the EIA predicts a net decrease in production through
2030.... The World Nuclear Association estimates
natural gas is 60 percent of an oil-sands facility's operating costs. But the price of natural gas jumped 6 percent in the past week alone, to
$7.56 per thousand cubic feet, down from the $8.51 average last year and well above the $2
levels of the 1980s and 1990s..... There are still a number of roadblocks to clear, at
least before Canadian sands are powered by nuclear reactors. Canada's Alberta province,
where nearly all its sands are located, has never had any nuclear power. It would likely
need the general approval of the community, including a large indigenous population. The
Canadian House of Commons' Committee on Natural Resources issued a report this month
entitled, 'The Oil Sands: Toward Sustainable Development,' in which it put a hold on
nuclear energy 'until the repercussions of this process are fully known and understood.'
.... The report cited worries over the waste produced
by nuclear plants and questions about nuclear energy's ability to deliver the needed
steam. And the committee was uncomfortable not
knowing whether the sands would need one or numerous large reactors to power operations,
or an even greater number of smaller models. There are two types of oil-sands operations.
The more shallow deposits are harvested in a strip-mining-style, where Earth is peeled
back and massive trucks and shovels remove the wanted product. It's then super-heated with water or steam, and the molasses or tar-like bitumen is removed. 'Right now mining is
the largest component, more than 60 percent of production of oil sands,' Collins said. 'More than 80 percent of global reserves' are too deep for mining
'the low-hanging fruit.' Two primary technologies --
called 'in situ' (Latin for 'in place') -- have been developed for deep extraction. Cyclic Steam Stimulation uses high-pressure steam delivered
through pipes to heat up the heavy bitumen, which is
brought to the surface. For Steam Assisted Gravity Drainage, a method gaining in
popularity, Collins said, two parallel pipes are drilled vertically and then jut in a
90-degree angle. The top pipe injects steam, and the one below collects the bitumen and draws it to the surface. Both in situ and surface mining bitumen needs further intensive
processing and upgrading so that it is capable of being refined or sent away in a
pipeline. A number of nuclear companies, led by
Energy Alberta, which has plans to bring two reactors online to power sands operations by
2017, are looking to provide the energy needed for such projects."
Analysis: Nuclear-powered oil sands
United
Press International, 30 March 2007
Dream On!
"Uranium demand is
expected to increase by 50% in the next 25 years and will
exceed supply within the next decade."
Michael Angwin, executive director of the Australian Uranium
Association
Uranium to top $1bn 'by end of decade'
The
Australian, 22 March 2007
Peak Oil And
Global Warming
How Gordon Brown Blew The North Sea Oil And Gas Legacy
The Bombshell In Gordon Brown's 2007
Budget
That Nearly All The Media Missed
"Our forecasts of the
current [budget] balance from 2007-08 to 2011-12 are affected by
one major change in the last year - the sharply
lower levels of production and yet higher costs in the North Sea - which have this year reduced tax revenues from £13 billion to £8
billion and for each year into the future cut them by an average of £4 billion a year." |
"A £2.8bn black hole in North Sea tax revenues has opened up after
Chancellor Gordon Brown was forced to admit he has got his sums badly wrong on last year's
controversial raid on oil and gas revenues. Latest
projections suggest the Treasury is finally admitting the North Sea's oil and gas reserves
are in terminal decline. Brown last year doubled the supplementary tax charge on North Sea
companies to 20% which, with existing rates of
corporate tax, means the oil and gas companies are paying about half their North Sea
revenues in tax. The Chancellor justified the
increase on the super-profits being made by the oil companies. But buried in his
Pre-Budget Report yesterday was an admission by the Chancellor that there will be a
significant shortfall in the forecast tax take, reckoned to be around £2.8bn, next year
because the Treasury has misjudged the increasing
difficulty and cost of lifting the dwindling North Sea reserves. The report says this year's tax take will be on budget at just over
£10bn. But while the oil is trading at $9 a barrel above the Treasury's projections, the
2007-8 take of £10.7bn is 'a much more modest increase than assumed in the Budget 2006
forecast'. The Pre-Budget Report admits to a catalogue of miscalculations, not least a significant drop in North Sea output this year, down 8% in the
third quarter of 2006, 38% lower than in 2000.
Output is expected to drop by 3% a year until 2011. 'The structural decline since 2000
reflects the rundown of reserves in the North Sea and increasing extraction costs for the
remaining oil and gas,' says the report."
The £2.8bn North Sea black hole
Evening
Standard, 7 December 2006
"Although Gordon Brown
urges the members of the Opec oil producing cartel to increase production to bring down
prices, he will be quietly rubbing his hands with glee at the benevolent effect dearer
energy is having on the UK's public finances. With all the taxes levied on the North Sea
oil and gas industry he, like previous chancellors, stands to make billions from the rise
in prices which yesterday saw Brent crude break through the $50 a barrel level for the
first time. But Mr Brown should enjoy it while it
lasts. The fact is UK oil and gas, which has given a big boost to the economy for the past
two and a half decades, is running out fast. At current rates of extraction, the last drop of oil could be sucked out
of the North Sea fields in about 10 years' time. Oil
output is already down by a quarter since peaking in 1999 at about 2.8m barrels per day
(bpd), although the current production of 2.1m bpd is in line with the average of the past
20 years. At the present rate of decline, according
to the UK Offshore Operators' Association, the country will cease to be self-sufficient in
2007, production will drop to 1m bpd by 2010 and dry up little more than five years later.... Britain is also running out of gas from the North Sea. Given that a
large chunk of the country's electricity generation depends on gas, the shortfall will
have to be made up by imports. 'You can see that production levels of oil and gas have
dropped sharply over the last two years and that is set to continue, with fundamental
consequences for the economy,' says David Page, an economist at Investec bank in the City.
He is talking about everything from employment and
tax receipts to the balance of payments and the pound....
Oil has kept the British economy lubricated since the late 70s when production started. It
has provided tax revenues of almost £200bn over that period in today's prices, equivalent
to a fifth of current-day gross domestic product and nearly half of one year's current tax
receipts. North Sea tax revenues were about £5bn a
year be tween 2000 and 2003, equivalent to nearly 2p off the basic rate of income tax. Mr Brown had pencilled in about £3.6bn of revenues for the current year
on the assumption of an average oil price of $31 a barrel for London Brent. But with oil
prices having jumped more than 65% since the start of the year, revenues will be nearly
double the Treasury's estimate. Last year the oil and gas industry in Britain accounted
for about £23bn, or 2.5% of the economy. It directly employed 260,000 people. Britain is
still a significant producer of oil and gas. Last year it was the world's 11th largest oil
producer and fourth largest gas producer. It has been self-sufficient in oil for the past
20 years and that is likely to continue for another three, at which point the UK will
become a net importer. The decline is showing up in data from the Office for National
Statistics. Last month it reported a deficit on trade in oil of £61m in July. Although
small in terms of Britain's trading position and though it has since been revised to a
small surplus, it was the first deficit since August
1991 and alarmed the City and political circles.
From now on, monthly oil trade deficits will become a regular feature. As recently as two
years ago, a monthly surplus of £500m was the norm."
Britain's bounty is running dry
Guardian, 12 October
2004
World Wildlife Fund/New Economics
Foundation a windfall tax The UK Exchequers dependence on fossil fuel income [Extracts] Like Britain, Norway was lucky enough to win a geographical lottery. It found itself sitting on a vast reservoir of fossil fuel wealth. Unlike Britain, Norway saw that the profit windfall from exploiting its accidental inheritance wouldnt last forever. It prudently set up a substantial fund to invest its oil surpluses with the aim of making sure that future generations would benefit once the oil was gone. The Norwegian Petroleum Fund is much more than a politically correct gesture toward future generations. At the end of 2005 it stood at $210 billion. To put that figure into perspective, the fund is currently worth around $45,000 each to every man, woman and child living in Norway today..... ..... the [UK] Treasurys dependence on oil income raises other important questions about the Governments ability to meet the twin challenges of tackling climate change, and responding to the coming economic shocks related to the peak and decline of global oil production. Norway is more dependent than the UK on income from oil and gas. It represents nearly one-fifth of the countrys GDP and 44 per cent of its exports. But, in Britain, around £1 in every £12 of government income comes from the oil and gas sector. This money currently enters government coffers to be spent on anything from obvious public goods, like schools and hospitals, to subsidising more controversial areas, like new roads and airport expansions, and to paying for quangoes and spin doctors. But day-to-day political pressures make it extremely difficult for governments to earmark funds for long-term projects that wont reach fruition, or their benefits be seen, within their own, guaranteed term of office. We face a paradox. Just as the price of oil and the profits of oil companies hit record highs, perversely the chance to invest these gains for the future is slipping away. Unless we act quickly, we will lose the extraordinary economic gains from using what remains of our fossil fuels that are still safe. We will have followed a path with the signpost, get rich quick, stay poor long. As a nation, the UK is missing its own targets for reducing its greenhouse gas emissions. Our emissions are in fact rising when, to stay within relatively safe targets to minimize global warming, we need to be making cumulative cuts of more than 3 per cent per year. In spite of advertising their green credentials, oil companies like BP and Shell are investing huge sums in exploring for more oil, rather than shifting to safe, renewable energy technologies. The time has come to force the issue by setting up an Oil Legacy Fund designed to invest in the urgent, wide-scale transition to a sustainable energy system. Such a fund would, we believe, be the most appropriate memorial to a fuel source that has brought both great wealth and great problems... .... in spite of BPs emphasis in its advertising on renewable energy, it conceded in summer 2006 that, 'Our main activities are the exploration and production of crude oil and natural gas; refining, marketing, supply and transportation; and the manufacture and marketing of petrochemicals.' Even more to the point, its pattern of investments in research and development shows that this is how things will stay. In 2005, only around one-twentieth of its investment went into what it termed alternative energy (a definition in which BP includes some fossil fuel, gas-powered generation). On the other hand, over 70 per cent of its capital investment went towards finding even more oil and gas. Shell, which also likes to promote clean, green credentials in its advertisements, was even worse. Just 1 per cent of its investment went towards renewable energy compared to 69 per cent to explore for more oil and gas...... At least compared to Norway, Britain has frittered away its oil income without investing adequately in a sustainable long-term energy supply. For example, we can only conjecture how much further advanced our domestic renewable energy sector would be, had it enjoyed the same level of public investment over the last half a century as that received by either the roads programme or the nuclear industry. It is, therefore, long overdue for the proceeds from liquidating our fossil fuel assets to be put to better, and more appropriate use.... Total oil- and gas-related revenues increased rapidly in the first half of the 1980s, reaching a peak of £40.2 billion (at 2000 prices), or 14.6 per cent of HM Revenue and Customs receipts. This largely reflected the development of the North Sea fields, coupled with continued high prices following the major oil shock increases of 1973/4 and 1979. However, revenues fell sharply after 1985/6, halving to £20.6 billion in 1992/3, reflecting the dramatic fall in oil prices in 1986, and the temporary drop in North Sea production in the late 1980s and early 1990s. Despite the restoration of previous production levels and higher world prices, revenues have recovered only partly, to a peak of £32.6 billion in 2000/01, and have fallen slowlysince, to £31.1 billion in 2004/5. This figure, however, excludes around £6 billion in VAT bringing the total to over £37 billion. ...... The variation in revenues between 1978/9 and 1986/7 is almost entirely accounted for by petroleum revenue tax, corporation tax, royalties and (in 1981/2 and 1982/3) the special petroleum duty. Other revenues have remained relatively stable. This has led to a marked shift in the composition change in oil- and gas-related taxes and duties as well as their overall contribution. While taxes levied on North Sea production represented around 50 per cent of the total in the first half of the 1980s, they almost disappeared at the beginning of the 1990s, and have recovered only to a limited extent since. In 2004/5, North Sea revenues were estimated to be just 15 per cent of the total, taxes and duties on sales, uses and latterly emissions representing the remaining 85 per cent. While there has been some recovery since the late 1990s, this is almost entirely made up of corporation tax rather than oil-specific taxes and levies. Specific climate-change-related carbon taxes remain minimal. The shift towards revenues from taxes on sales/uses reduces the sensitivity of revenues to the decline in North Sea production. However, it does raise a different concern. In principle, the prospect of much higher world oil prices offers the possibility of increasing taxes on the extractive industry, to capture some of their windfall. Declining North Sea production, however, will increasingly limit the scope for this.... In his pre-budget report, Gordon Brown announced that he would double the supplementary charge on oil companies from 10 per cent to 20 per cent. The effect will be to increase the total revenues from North Sea production by a further £2,630 million, following an increase of £3,875 million this financial year. The effect is to nearly double the total contribution of the sector to total revenues, from 1.16 per cent to 2.26 per cent. While detailed projections are not available on other taxes, this is also likely to increase overall oil-and gas-related taxes and duties, both absolutely and as a percentage of the total, and to shift the balance slightly from taxes on consumption back towards taxes on production..... UK oil and natural gas production peaked in 1999 and 2000, since when they have declined at an average rate of 7.0 per cent pa and 3.0 per cent pa respectively (to 2004). Subsequent estimates for oil by the US Energy Information Administration (EIA) show a decline of 7.8 per cent pa, continuing to 2005. The EIA anticipates a decline in UK oil production to 1.4 mbd (million barrels per day) in 2025. Contrary to general expectations, however, this appears to be based on an assumption of a temporary recovery to 2.2 mbd in 2010 (an increase of 1.6per cent pa from the actual figure of 2.0 mbd in 2004), suggesting that this may be an optimistic scenario, or use a baseline inconsistent with the historical data. These figures would imply an average reduction of 1.7 per cent pa in 200425, and 3.0 per cent pa in 201025.Taken together, these figures suggest a decline in real UK energy production in the order of 5 per cent pa, suggesting that taxation per unit of production would need to increase at a similar rate for total revenues to remain constant. Based on the assumptions for tax per unit of production, as discussed above, this would require an increase in world prices of well over 10 per cent pa. These findings are broadly consistent with the UK Offshore Operators Associations (UKOOA) projections of rapidly declining tax revenues from production taxes as shown in Figure 9, although a direct comparison is not possible because the underlying assumptions for these projections are not specified. This suggests that, should world energy prices rise considerably faster than is currently envisaged even in high-price scenarios, the potential for production taxes will decline rapidly as a result of increasing production costs and declining levels of production. Rising oil prices give rise to increasing pressure to avoid increasing taxation on fuel use.... The extreme manifestation of this and one that will haunt Chancellors for years to come was the fuel protests in 2000. In a high-oil-price scenario, therefore, the potential to increase, and perhaps even to maintain, fuel and vehicle excise duties is likely to be limited.... |
"Our forecasts of the
current balance from 2007-08 to 2011-12 are affected by
one major change in the last year - the sharply
lower levels of production and yet higher costs in the North Sea - which have this year reduced tax revenues from £13 billion to £8
billion and for each year into the future cut them by an average of £4 billion a year." |
"BP employs a focused exploration
strategy in areas with the potential for large oil and natural gas fields as new profit centres..... We
also manage the decline of our existing profit
centres in Alaska, Egypt, Latin America, Middle
East, North America gas and the North Sea."
Exploration and Production
BP
Annual Review 2006
"Energy
giant BP is interested in working on a range of oil and gas projects in Iraq, but is
waiting for the country's parliament to pass an oil law and for security to improve before
increasing its role, a senior BP executive said on Monday. International companies have been jostling for position as they look for
a potentially lucrative stake in Iraq's oil future. The country holds the world's third
largest oil reserves and needs billions of dollars of investment to boost output and
overhaul ageing infrastructure. 'Eventually where we get involved will be up to Iraq,'
Steve Peacock, president of BP's Middle East and South Asia Exploration and Production
unit, told reporters at an energy conference in Dubai. 'But I think we can help in all
areas: enhanced oil recovery from existing fields, in discovered and not developed fields,
or in exploration.' A draft oil law that Iraq's cabinet endorsed in February is awaiting
parliament's ratification. Peacock said it would take some time after the law is passed
for contracts to be negotiated and for BP to send people to work in Iraq because of the security situation in the country. 'Physical security on the ground... may be the thing that takes the
longest,' he said. BP would also wait for assurance that any contracts would survive
changes in government, he said. BP has been providing assistance to Iraq's oil company in
the south around the Rumaila field, he said. The North and South Rumaila fields are
already partially developed and have combined potential output capacity of 500,000 barrels
per day. BP would not look at involvement in Iraq's Kurdish region in the north until the
oil law had been passed, even though security in the region is better than elsewhere in
the country, he said."
BP Eyes Role in Iraq, Awaits Oil Law, Security
Reuters, 16 April 2007
"Lord Browne, chief executive of BP and one of New Labour's favourite industrialists, has warned Washington
not to carve up Iraq for its own oil companies in the aftermath of any future war.
The comments from the most senior European oil executive.... will ... serve to underline
concern that the US is primarily concerned with seizing control of Saddam Hussein's oil
and handing it over to companies such as ExxonMobil rather than destroying his weapons of
mass destruction..... Lord Browne's views will be
listened to carefully in Downing Street because the BP executive team has such close links with the UK government that it was
once dubbed Blair Petroleum. A number of former BP executives, such as Lord Simon, have been seconded into
Whitehall while one of Mr Blair's personal assistants, Anji Hunter, joined Lord Browne's
team. "
BP chief fears US will carve up Iraqi oil riches
Guardian, 30 October
2002
'It's The Money Stupid'
The BP/New Labour Oil Timeline
2007
"BP is Britain's biggest company, the
fifth largest in the world. It employs 17,000 people in Britain and contributes £1.3 billion every year in tax revenue. Everyone who owns a car buys BP fuel, and everyone who has a pension
fund is likely to be a shareholder. Asked in a recent
interview whether there was anyone in Britain more powerful than him, Gordon Brown named
four men, all businessmen. First on his list was Lord Browne, until this week boss of BP, ennobled by this Government in 2001 and dubbed the Sun King for the way
he had built BP into an industry giant..... Four months ago, this newspaper was approached
by Lord Browne's former lover, a young Canadian called Jeff Chevalier. We were told by him
that, despite being honoured in public and befriended
in private by the Chancellor, Lord Browne thought
the Government's taxes on business so damaging that he had to consider drastic changes in the way BP
operated. According to Mr Chevalier, Lord Browne threatened to move BP's headquarters
abroad. If carried out, such a move would be devastating,
not only for the Government's tax revenues but for
the tens of thousands of highly-paid jobs an international business such as BP sustains
when headquartered in Britain. This was a business
story of great significance - but obviously Mr
Chevalier's account had to be checked, and calls were put in to BP, outlining what he was
saying. The first response came from a public relations consultant working
directly for Lord Browne. He told us that while Mr Chevalier had been Lord Browne's lover,
it was completely untrue that Lord Browne had made the
alleged threat, and in any case Lord Browne never,
ever discussed business matters with Mr Chevalier. At 10am the following morning, The Mail
on Sunday's Political Editor took a phone call from BP's highly respected public relations
chief. His message was the exact opposite: of course BP had looked at the problem Mr
Chevalier outlined, nor should we forget that at the time of Lord Browne's threat the
Government was contemplating a windfall tax on North
Sea oil profits.... Neither PR man made any issue of
Lord Browne's homosexuality, which was well-known in the world of business and politics.
Neither was it to be the focus of our story beyond sufficient reference to explain how a
27-year-old Canadian had been privy to such information. We cleared space for a story
which would report Mr Chevalier's claims, reflect the fact that there appeared to be
conflict within BP over how to respond and include information on other major companies
facing the same problem as BP and considering meeting it in the same way. What we did not
know was that someone had advised Lord Browne to go to a firm of showbiz lawyers called
Schillings, who represent, among others, Caprice, Naomi Campbell and Wayne Rooney, and who
have built a lucrative industry in attempting to suppress embarrassing stories with
Saturday afternoon injunctions.... BP's original argument that Mr Chevalier had lied about
Lord Browne's threat to relocate BP headquarters had been undermined by their own
contradictory briefing. So now they would argue that, because Lord Browne's relationship
with Mr Chevalier was private, anything that passed between them was also private. Lord
Browne then set about trying to destroy the credibility of his former lover as a witness.
It was this which would lead to his sexuality being revealed by the courts, and to his
resignation.... He produced a laptop Lord Browne had given him, opened it up, and sure
enough it declared it was the property of BP and contained three months of Lord Browne's
confidential company email traffic."
Privacy, and the perils of secret justice
Mail
On Sunday, 6 May 2007
"One of the most
extraordinary claims to come to light in the six-month legal battle was that Lord Browne
was considering the politically explosive move of
switching BP's head office from London to New York.
The move, in protest at tax rates in Britain, would have provoked an outcry from BP employees and would have been
fiercely resisted by the Government as the company is a flagship of British industry. Lord
Browne and his many supporters fiercely deny that he seriously contemplated publicly or
privately moving the company overseas for tax purposes.The claim was one of many made by
Jeff Chevalier, his former boyfriend. The claim is
based on a meeting between Lord Browne and the Chancellor. The court documents state: 'The Claimant discussed with the government/Tony Blair/Gordon
Brown the prospect of BP potentially taking an important strategic decision.'" |
"Although there
are plenty who complain that it is only shareholders who have been enriched, it is
important to remember that one pound in every eight
that is paid into UK pension funds by UK companies comes from BP. It is still also one of Britain's biggest
taxpayers, despite the decline
in North Sea oil production. Lord Browne's
apparently infallible touch earned him the soubriquet of the Sun King and the title of
world's most admired businessman for many years."
The Big Question: Did Lord Browne deserve to be the world's most admired businessman?
Independent,
3 May 3007
"Tony Hayward, Lord Browne's
replacement, will present his plans for a reshuffle of the top team at BP when he attends
his first board meeting as chief executive in Washington next week. After the traumatic
departure of Lord Browne on Tuesday, at the end of a year of deteriorating morale at one
of Britains biggest companies, Mr Hayward is looking to refresh the executive
leadership and reassert a focus on safety. Mr
Haywards first week in the chief executives job is expected to include a
meeting with President Bush in the US capital....In
his presentation to the board, Mr Hayward will also emphasise continuity with key
strategies set down by Lord Browne. Among other things, BP will remain a British company. BP has mulled the idea of moving its domicile from the UK to the
US, but concluded that, regardless of the arguable
tax benefits, it would lose its status as a flag-carrying energy company, for ever
eclipsed by Exxon Mobil."
Chairman stays as Hayward plans top BP changes
London
Times, 3 May 2007
"The final months of Lord Browne's
dozen-year tenure at the top of BP are set
to go with a whimper rather than a bang after the company's slowing production led to a
dive in profits in the first quarter of 2007. The oil major today reported a 17% slump in
profits to $4.36bn (£2.2bn) from $5.2bn in the first three months of 2006. Amid BP's
high-profile problems in which it has been accused of complacency over safety after the
fatal Texas City oil refinery explosion and over the environment after spills on the
Alaskan tundra at Prudhoe Bay, BP's figures today also revealed how badly it is being hit
by the more fundamental operational worry of falling
production. BP said: 'This result was impacted by
lower oil and gas realisations and lower reported volumes.' BP also revealed that its
cashflows for the three months are down 10% to $8bn and that's its net debt of $21.8bn had
grown as a ratio of the entire value of the company to 20% from 16%."
BP on slide as Browne heads for exit
Evening
Standard, 24 April 2007
"BP Slashed its growth targets
yesterday as the oil major unveiled falling fourth-quarter profits that failed to prevent
it boosting annual profits 15 per cent to a record $22.3 billion (£11.3bn). Lord Browne,
in his last annual results before stepping down as chief executive this July, said production would fall in 2007
and only grow slightly to the end of the decade. That compared with earlier forecasts of
growth at 4 per cent per annum. BP forecast production in 2007 would fall to 3.8-3.9
million barrels of oil equivalent per day (boepd) from 3.93 million boepd in 2006. The
2006 result was down 2 per cent on 2005.... Hayward said factors affecting BP's 'new
conservative production guidance' included more focus on safety investment, and production problems ranging from the North Sea to Alaska. "
BP growth to fall but profits soar 15%
The Scotsman, 7
February 2007
"BP's domination of oil exploration on
Alaska's North Slope, allowed it to become a giant which challenged Exxon and its main
European rival Royal Dutch Shell for
global hegemony. Not just satisfied with securing the American market place, BP concluded
a landmark partnership deal in Russia giving it access through the TNK-BP partnership to
one of the most valuable oilfields in the world. When [Browne presented bumper results to
the world a year ago he was able to make the astonishing and true claim that one pound in
every six paid into pension funds and insurance companies in Britain, came from
investments in BP. Moreover, it was also the nation's
biggest taxpayer helping to support the public
services and the New Labour administration with which he was intimately involved. Since
the high point of early 2006 Browne's world has come tumbling down around him."
Business genius who lost the Midas touch
Daily
Mail, 2 May 2007
"Our forecasts of the current balance
from 2007-08 to 2011-12 are affected by one major
change in the last year - the sharply lower levels
of production and yet higher costs in the North Sea - which
have this year reduced tax revenues from £13 billion to £8 billion and for each year
into the future cut them by an average of £4 billion a year."
Gordon Brown's 2007 budget
Reuters,
21 March 2007
"Energy
giant BP is interested in working on a range of oil and gas projects in Iraq, but is
waiting for the country's parliament to pass an oil law and for security to improve before
increasing its role, a senior BP executive said on Monday. International companies have been jostling for position as they look for
a potentially lucrative stake in Iraq's oil future. The country holds the world's third
largest oil reserves and needs billions of dollars of investment to boost output and
overhaul ageing infrastructure. 'Eventually where we get involved will be up to Iraq,'
Steve Peacock, president of BP's Middle East and South Asia Exploration and Production
unit, told reporters at an energy conference in Dubai. 'But I think we can help in all
areas: enhanced oil recovery from existing fields, in discovered and not developed fields,
or in exploration.' A draft oil law that Iraq's cabinet endorsed in February is awaiting
parliament's ratification. Peacock said it would take some time after the law is passed
for contracts to be negotiated and for BP to send people to work in Iraq because of the security situation in the country. 'Physical security on the ground... may be the thing that takes the
longest,' he said. BP would also wait for assurance that any contracts would survive
changes in government, he said. BP has been providing assistance to Iraq's oil company in
the south around the Rumaila field, he said. The North and South Rumaila fields are
already partially developed and have combined potential output capacity of 500,000 barrels
per day. BP would not look at involvement in Iraq's Kurdish region in the north until the
oil law had been passed, even though security in the region is better than elsewhere in
the country, he said."
BP Eyes Role in Iraq, Awaits Oil Law, Security
Reuters, 16 April 2007
"So was
this what the Iraq war was fought for, after all? As the number of US soldiers killed
since the invasion rises past the 3,000 mark, and President George Bush gambles on sending
in up to 30,000 more troops, The Independent on Sunday has learnt that the Iraqi
government is about to push through a law giving
Western oil companies the right to exploit the country's massive oil reserves. And Iraq's oil reserves, the third
largest in the world, with an estimated 115 billion barrels waiting to be extracted, are a
prize worth having. As Vice-President
Dick Cheney noted in 1999, when he was still running Halliburton, an oil services company, the
Middle East is the key to preventing the world running out of oil. Now, unnoticed by most
amid the furore over civil war in Iraq and the hanging of Saddam Hussein, the new oil law
has quietly been going through several drafts, and is now on the point of being presented
to the cabinet and then the parliament in Baghdad. Its provisions are a radical departure
from the norm for developing countries: under a system known as 'production-sharing
agreements', or PSAs, oil majors such as BP and Shell in Britain, and Exxon and Chevron in the US, would be able to
sign deals of up to 30 years to extract Iraq's oil.... Britain and the US have always
hotly denied that the war was fought for oil...."
Blood and oil: How the West will profit from Iraq's most precious commodity
Independent, 7 January 2007
2006
"The UK became a net importer of oil for most of 2006, according to the
Oil Depletion Analysis Centre (ODAC) in Aberdeen. 'It is time for the UK government to let
go of the idea that the UK will be a net oil exporter until 2010 and accept we are now
dependent on imports,' ODAC said. Data published by the UK Department for Trade and
Industry showed that the UK imported oil during every month in 2006 except for June....
Crude oil production in the UK in 2006 was an estimated 1.6 million b/d, while consumption
was an estimated 1.7 million b/d."
ODAC: UK was net oil importer in 2006
Oil
and Gas Journal, 13 March 2007
"A
£2.8bn black hole in North Sea tax revenues has opened up after Chancellor Gordon Brown
was forced to admit he has got his sums badly wrong on last year's controversial raid on
oil and gas revenues. Latest projections suggest the
Treasury is finally admitting the North Sea's oil and gas reserves are in terminal decline. Brown last
year doubled the supplementary tax charge on North Sea companies to 20% which, with existing rates of corporate tax, means the oil and gas
companies are paying about half their North Sea revenues in tax. The Chancellor justified the increase on the super-profits being made by
the oil companies. But buried in his Pre-Budget Report yesterday was an admission by the
Chancellor that there will be a significant shortfall in the forecast tax take, reckoned
to be around £2.8bn, next year because the Treasury
has misjudged the increasing difficulty and cost of lifting the dwindling North Sea
reserves. The report says this year's tax take will
be on budget at just over £10bn. But while the oil is trading at $9 a barrel above the
Treasury's projections, the 2007-8 take of £10.7bn is 'a much more modest increase than
assumed in the Budget 2006 forecast'. The Pre-Budget Report admits to a catalogue of
miscalculations, not least a significant drop in
North Sea output this year, down 8% in the third quarter of 2006, 38% lower than in 2000. Output is expected to drop by 3% a year until 2011. 'The structural
decline since 2000 reflects the rundown of reserves in the North Sea and increasing
extraction costs for the remaining oil and gas,' says the report."
The £2.8bn North Sea black hole
Evening
Standard, 7 December 2006
"Yet again, Gordon Brown has to had to
tell us there is less tax revenue coming in than he had forecast. That's the ninth budget
or pre-Budget in a row that this has happened. The only difference to the previous eight
is that this time, few of us had expected him to have to break bad news. It turns out, though, that £3bn worth of revenues expected from
North Sea oil are not there. That's three billion the chancellor couldn't afford to lose.
As a result of that, Mr Brown has had to make a modest tax increase. The overall net tax
rise is £2bn a year."
Revenue gloom forces Brown's hand
BBC Online, 6 December 2006
"BP served up more bad news for
investors yesterday in a third-quarter trading statement that showed production was down,
refining margins had slumped and the company had paid more tax.... The third frustration
for the BP chief executive, Lord Browne, had been the chancellor's North Sea taxes. Gordon Brown raised oil company taxes in his pre-budget statement
last year, pushing BP's rate up from 35% to 40%."
Falling oil prices and higher tax take add to BP's woes
Guardian, 5 October 2006
"Research from nef (the new economics
foundation) and WWF reveals that although the UK Treasury is still dependent on oil, as
domestic supplies dwindle, the opportunity is slipping away to invest prudently the
sectors windfall profits. The briefing, Hooked on oil:
breaking the habit with a windfall tax, for the first time quantifies Treasury revenue
from a range of oil-and gas-specific taxes and duties. This reveals that, in
Britain, around £1 in every £12 of government
income comes from the oil and gas sector. The
briefing asks whether with so much income from fossil fuels, there is a powerful
short-term disincentive to kick the fossil fuel habit..... Unlike Britain,
Norway understood that the windfall wealth from its accidental inheritance wouldnt
last forever. It prudently set up a substantial fund to invest oil surpluses
to ensure that future generations would benefit once the oil was gone."
Windfall tax call on oil companies as profits announced
New Economics
Foundation, 23 October 2006
"Activists from the Hands Off Iraqi
Oil campaign today delivered a warning to oil company BP that it will face massive public
outrage if it continues in its attempts to 'rip off' Iraqi oil. They were demonstrating at
the company's Annual General Meeting in London's Docklands against the role BP has played in lobbying for a controversial new oil law
in Iraq. The law would transfer control over the
majority of the country's huge oil reserves from the public sector to multinational
companies, for the first time in 35 years. BP has
been at the forefront of efforts to gain access to Iraq's oil since the invasion of Iraq
in 2003. - In 2003 and 2004, successive BP
executives left to work as oil advisers to the occupation authorities in Iraq, paid for by
the UK government. - One of these advisers wrote a 'Code of Practice' for the Iraqi Oil
Ministry, which called for multinational companies to play the major role in developing
Iraq's oil, and for the Ministry's policies to be compatible with those of BP. - Since
2003, BP has also been one of six major oil companies working through a lobbying
organisation called the International Tax and Investment Centre (ITIC) to push for the
handover of control of Iraq's oil to transnational oil companies. - Together with the
other major oil companies, and the British government, they have pushed the Iraqi
government to agree to allow companies to take control of Iraqi oil production through
controversial long-term contracts known as 'production
sharing agreements'."
BP warned against Iraq oil 'rip-off' at AGM
Platform,
12 April 2006
2005
"Chancellor Gordon Brown has announced
a rise in the tax levied on North Sea oil producers in the wake of record crude prices.
Under the measure, the government's supplementary
charge on energy companies will rise to 20% from 10%....
Economists at Deloitte said the increase was double the 5% they had expected and would raise £1.4bn for the Treasury's coffers next year and
£5.2bn by the end of 2008.... The oil industry
lobby group, the UK Offshore Operators Association (UKOOA), said it was 'shocked' by the
chancellor's decision. 'At a single stroke, the Treasury has rewritten the industry's
future. It will severely undermine business confidence,' warned the UKOOA chief executive,
Malcolm Webb. 'This has been done not once but twice in the space of just three years and
we fear that this time the North Sea will not be as resilient.' The rise could cost BP alone £400m a year, analysts said, if the oil price stands at about $60 a barrel.
'Governments levy taxes and we will do what we have to,' said a BP spokesman. 'But any
extra tax that we pay is money that is no longer available for investment in North Sea oil
and gas fields.'... The new tax rise will take effect from 1 January 2006."
Brown doubles North Sea oil tax
BBC Online, 5 December 2005
"At the time it all seemed too much -
too plainly far-fetched - for Jeff Chevalier to take in. But here he was, a 25-year-old
once-penniless Canadian male prostitute, sitting down
to dinner with the Prime Minister of Great Britain.
And the two men were liberally helping themselves from a £3,000 bottle of claret. The
wine was the personal choice of Lord Browne of Madingley - the boss of British Petroleum,
Britain's most senior businessman and host of the dinner party in question. 'Mr Blair
didn't know what it was but he absolutely loved it,' Mr Chevalier recalls. 'It was a 1983
French claret.'... The cosy dinner for Tony Blair in
the summer of 2005 came
amid a seemingly endless merry-go-round of dinners, lunches, soirees and parties that Mr
Chevalier was summoned to by his tycoon lover, 34 years his senior..... Today, in an
exclusive interview in The Mail on Sunday, Jeff Chevalier gives a stunning account of the
extravagance of life at the top of BP. His testimony will raise important questions about
Lord Browne's taste for the high life - together with his eagerness to lavish company
largesse on his young lover, and the access that Mr
Chevalier was thereby granted to privileged information.... The Mail on Sunday is prohibited
by court order from disclosing the details of Lord Browne's dinner-table conversation with
the Prime Minister. This is a shame, since the
encounter casts revealing light on the two men - and on the overlap that exists between
their business and their personal relationships. Both pre-eminent in their fields, they made use of each other for the benefit of their respective
organisations - and then, perhaps, for the benefit
of themselves. We can say, however, that Mr Blair was in reflective mood, and mused on
life after Downing Street. Lord Browne listened sympathetically and offered suggestions.
The dinner took place just a few days before Mr Blair and his wife Cherie flew off to
Singapore for some last-minute championing for London to host the 2012 Olympic Games.
Cherie did not attend the meal. But Anji Hunter, who
had been Tony Blair's 'gatekeeper' before leaving to work for Lord Browne at BP, was
invited..... [On another occasion] A dinner and
lunch guest was Peter Mandelson, a former Cabinet member and now a European Union Trade
Commissioner. He arrived for dinner with his own long-time partner, Brazilian Reinaldo da
Silva. Mr Chevalier recalls: 'There were only the four of us and I remember thinking the
moment I met them what an odd couple they were. Peter was very smooth and charming,
appearing to hang on John's every word.' The non-stop socialising was part of the
corporate culture instilled at BP by Lord Browne. It seemed, too, that the peer was not
above using the prestige of BP to get privileged treatment for himself.... According to Mr
Chevalier, Lord Browne also saw his friendships in terms of people he could derive mutual
business benefit from."
The True story about Lord Browne - by ex-rent boy lover
Mail
On Sunday, 6 May 2007
2004
"BP's chief executive delivered a
serious setback to hopes of rebuilding Iraq when he said that the oil company has no
future there. John Browne, one of Tony Blair's favourite industrialists, indicated he had given up on Iraq because the political and security
situation in the country had deteriorated so much.
Yet only 18 months ago he was extremely enthusiastic about prospects, lobbying in
Washington and London to ensure American rivals did not cut him out of the action.... The
pessimistic view about the future in Iraq was expressed hours after Lord Browne had met
the prime minister at the launch of a new climate change organisation.The downbeat message
contrasts with the optimism expressed in the autumn of 2002 when the BP chief was
desperately worried that American firms would monopolise Iraq once Saddam Hussein was
overthrown. 'We have let it be known that the thing we would like to make sure, if Iraq
changes regime, is that there should be a level playing field,' Lord Browne had said. Western oil firms originally hoped there would be a bonanza as the country with the second biggest oil reserves in the world expanded
its production dramatically. But these aspirations have evaporated as the hopes of peace
following invasion by American and British forces have given way to ferocious guerrilla
attacks."
BP ready to quit in blow to rebuilding hopes
Guardian, 29 April
2004
"Although Gordon Brown urges the
members of the Opec oil producing cartel to increase production to bring down prices, he
will be quietly rubbing his hands with glee at the benevolent effect dearer energy is
having on the UK's public finances. With all the taxes levied on the North Sea oil and gas
industry he, like previous chancellors, stands to make billions from the rise in prices
which yesterday saw Brent crude break through the $50 a barrel level for the first time. But Mr Brown should enjoy it while it lasts. The fact is UK oil and gas,
which has given a big boost to the economy for the past two and a half decades, is running out fast. At current rates of
extraction, the last drop of oil could be sucked out of the North Sea fields in about 10
years' time. Oil output is already down by a quarter
since peaking in 1999 at about 2.8m barrels per day (bpd), although the current production
of 2.1m bpd is in line with the average of the past 20 years. At the present rate of
decline, according to the UK Offshore Operators'
Association, the country will cease to be self-sufficient in 2007, production will drop to
1m bpd by 2010 and dry up little more than five years later.... Britain is also running out of gas from the North Sea. Given that a
large chunk of the country's electricity generation depends on gas, the shortfall will
have to be made up by imports. 'You can see that production levels of oil and gas have
dropped sharply over the last two years and that is set to continue, with fundamental
consequences for the economy,' says David Page, an economist at Investec bank in the City.
He is talking about everything from employment and
tax receipts to the balance of payments and the pound....
Oil has kept the British economy lubricated since the late 70s when production started. It
has provided tax revenues of almost £200bn over that period in today's prices, equivalent
to a fifth of current-day gross domestic product and nearly half of one year's current tax
receipts. North Sea tax revenues were about £5bn a
year be tween 2000 and 2003, equivalent to nearly 2p off the basic rate of income tax. Mr Brown had pencilled in about £3.6bn of revenues for the current year
on the assumption of an average oil price of $31 a barrel for London Brent. But with oil
prices having jumped more than 65% since the start of the year, revenues will be nearly
double the Treasury's estimate. Last year the oil and gas industry in Britain accounted
for about £23bn, or 2.5% of the economy. It directly employed 260,000 people. Britain is
still a significant producer of oil and gas. Last year it was the world's 11th largest oil
producer and fourth largest gas producer. It has been self-sufficient in oil for the past
20 years and that is likely to continue for another three, at which point the UK will
become a net importer. The decline is showing up in data from the Office for National
Statistics. Last month it reported a deficit on trade in oil of £61m in July. Although
small in terms of Britain's trading position and though it has since been revised to a
small surplus, it was the first deficit since August
1991 and alarmed the City and political circles.
From now on, monthly oil trade deficits will become a regular feature. As recently as two
years ago, a monthly surplus of £500m was the norm."
Britain's bounty is running dry
Guardian, 12 October
2004
2003
"The Bush administration made
plans for war and for Iraq's oil before the 9/11 attacks, sparking a policy battle
between neo-cons and Big Oil, BBC's
Newsnight has revealed..... Two years ago
today - when President George Bush announced US, British and Allied forces would
begin to bomb Baghdad - protesters claimed the US had a secret plan for Iraq's oil once
Saddam had been conquered. In fact there were two conflicting plans, setting off a hidden
policy war between neo-conservatives at the Pentagon, on one side, versus a combination of
'Big Oil' executives and US State Department 'pragmatists'. 'Big Oil' appears to have won.
The latest plan, obtained by Newsnight from the US State Department was, we learned,
drafted with the help of American oil industry consultants. Insiders told Newsnight that planning began 'within
weeks' of Bush's first taking office in 2001,
long before the September 11th attack on the US....The industry-favoured plan was pushed
aside by a secret plan, drafted just
before the invasion in 2003, which called
for the sell-off of all of Iraq's oil fields. The new plan was crafted by neo-conservatives intent on using
Iraq's oil to destroy the Opec cartel through massive increases in production above Opec
quotas. The
sell-off was given the green light in a
secret meeting in London headed by Ahmed
Chalabi shortly after the US entered Baghdad, according to Robert Ebel. Mr Ebel, a former
Energy and CIA oil analyst, now a fellow at the Center for Strategic and International
Studies in Washington, told Newsnight he flew to the London meeting at the request of the
State Department.....Philip Carroll, the former CEO of Shell Oil USA who took control of
Iraq's oil production for the US Government a month after the invasion, stalled the
sell-off scheme.... Ariel Cohen, of the neo-conservative Heritage Foundation,
told Newsnight that an opportunity had been missed to privatise Iraq's oil fields..... New
plans, obtained from the State Department by Newsnight and Harper's Magazine under the US
Freedom of Information Act, called for creation of a state-owned oil company favoured by
the US oil industry. It was completed in January 2004 under the guidance of Amy Jaffe of
the James Baker Institute in Texas. Formerly US Secretary of State, Baker is now an
attorney representing Exxon-Mobil and the Saudi Arabian government.... "
Secret US plans for Iraq's oil
BBC News, 17 March 2005
"A few years ago, many thought the
North Sea to be in terminal decline at least from the point of view of the Supermajors as they looked to manage their exit from the North
Sea. A new breed of low cost operators had begun to
move in and take on this ageing asset base which was failing to attract the level of
investment required to sustain production. Never was
this more visible than when BP sold their iconic operating stake in the Forties field to
Apache for $1.3b in early 2003."
United Kingdom: Back To The Future - Exploring The Options For The 21st Century North Sea
Deloitte, 2 May 2007
"Energy giant BP has moved to boost
profit margins at the expense of volumes after announcing the sale of the Forties field,
one of the oldest in the North Sea, and a swathe of small Gulf of Mexico assets to US
independent producer Apache, for US$1.3 billion (£810 million). The sale, which brings
Apache into the North Sea for the first time and boosts its overall output by 29 per cent,
is part of BPs ongoing review of operations announced last year after the company
suffered the embarrassment of downgrading its production growth expectations. Completion
of the deal is expected in the first half of this year. Forties is still the largest UK
find ever made and dates back to 1970. It once peaked
at 500,000 barrels per day, but its production is now about 48,000 barrels of oil
equivalent per day, less than 6.5 per cent of
BPs North Sea output."
BP's Forties field sold for £810m
The Scotsman, 14
January 2003
"Tony Blair held a private dinner with
Lord Browne one month after he was reelected in 2005, in which he discussed life after
Downing Street, it emerged yesterday. Despite pledging at the general election to serve
for a full third term, the Prime Minister was already talking to his closest City
confidants about life after politics. Earlier this year rumours surfaced in the City that
Mr Blair may join BP after leaving Downing Street or start a venture capital company with
Lord Browne. Neither side has commented on these suggestions. Whether or not such plans
were discussed, the meeting underscores the connections between the Prime Minister and
Lord Browne. Indeed it was organised by Anji Hunter, Mr
Blairs closest aide, who left Downing Street to work for BP in late 2003....."
BP was nicknamed Blair Petroleum
London Times,
2 May 2007
"British
oil company BP PLC has put a team to work on a strategy for its future in oil-rich Iraq,
people familiar with the situation said Tuesday. The news follows a meeting in London at
the weekend where Iraqi exiles and U.S. state department officials agreed that
international oil firms should take a leading postwar role in reviving Iraq's oil
industry. Oil companies and the U.S. and British governments have been unwilling to talk
openly about the future of the oil industry in Iraq.
They fear fueling accusations that the invasion of the country by U.S. and British troops
was motivated by a desire to get western hands on the world's second largest reserves of
crude. But concerns are already growing among European companies that a U.S.-dominated
postwar administration will give first bite of the Iraq oil cherry to its own companies.
In February this year, as war clouds gathered, BP Chief Executive John Browne voiced those
concerns, saying: 'The most important thing for us is that there remains a level playing
field when it comes to consideration for activity in Iraq.' And BP, the world's third
largest oil company whose links to Iraq oil date back to the 1920s, does not plan to be
caught off guard if oil contracts and concessions are to be handed out. 'There has been a team working on Iraq for some time now in BP,' said one source. Another said the team's activities were largely limited
to 'exchanges of information and keeping a watching brief on developments.'"
BP maps out Iraq strategy
Reuters, 9 April 2003
".... our
energy system faces new challenges.... Our energy supplies will increasingly depend on
imported gas and oil..... we need access to a wide range of energy sources."
British Prime Minister
Foreword to DTI Energy White
Paper, February 2003
2002
(MI6 - Aka BP, Aka 'Blair's Petroleum' - Lied To Hoon)
"But Geoff Hoon, who was defense
secretary in Prime Minister Tony Blair's government from 1999 until 2005, said intelligence officials had
believed Saddam was amassing weapons of mass destruction and that the allies did not lie
about why they went to war..... Hoon defended the decision to go to war on the basis of
intelligence that believed Iraq was building up an arsenal of weapons of mass destruction
intelligence he now accepts was wrong. 'I've
been present at a number of meetings where the intelligence community was fixed, and
looked in the eye and asked are you absolutely sure about this? And the answer came
back 'Yes, absolutely sure,' Hoon was quoted
as saying. Hoon said he felt no need to apologize."
Cheney Iraq role reviewed in Britain
Associated Press, 2
May 2007
"A second senior MI6 officer is resigning in
a shake-up of the top ranks of Britain's secret intelligence service, the Guardian has
learned. MI6's director of operations, who cannot be named for reasons of personal
security, is to take up a job in the City. He follows Mark
Allen, the director responsible for anti-terrorism,
who left in the summer to join BP."
Another top MI6 officer quits
Guardian, 6 December
2004
"A
retired MI6 officer has been appointed to a top post at BP-Amoco, the British-based oil company..... John
Gerson was director of security and public affairs
at the agency and was embroiled in attempts to suppress disclosures by the former MI6 officer Richard
Tomlinson. Mr Gerson took early retirement from what was effectively the post of deputy head of MI6 at the
end of last year. Last month he became one of BP's vice-presidents for government and public affairs. His appointment was
approved by the cabinet secretary, Sir Richard Wilson. MI6 has close links with oil companies, the 'revolving door' syndrome, in the
same way as armed forces officers have close links with defence companies. Rolls-Royce has
employed former MI6 officers to help win contracts in the Middle East, and merchant banks
have taken some on. During the first reading of the intelligence services bill, Lord Mackay, the conservative lord chancellor, told peers in 1994 that MI6
protected the 'economic wellbeing' of the country by keeping 'a particular eye on
Britain's access to key commodities, like oil...'"
Former MI6 officer gets top post at BP
Guardian, 8 May 2000
"The choice of Iyad Allawi, closely
linked to the CIA and formerly to MI6, as the Prime Minister of Iraq from 30 June will make it difficult for
the US and Britain to persuade the rest of the world that he is capable of leading an
independent government. He is the person through whom the controversial claim was
channeled that Iraqi weapons of mass destruction could be operational in 45 minutes....
After the 1991 Gulf War, the Iraq National Accord (INA) party, which he helped to found,
became one of the building blocks for the Iraqi opposition in exile. The organization
attracted former Iraqi army officers and Baath party officials, particularly Sunni Arabs,
fleeing Iraq. In the mid-1990s the INA claimed to have extensive contacts in the Iraqi
officer corps. Dr Allawi began to move from the orbit of MI6 to the CIA. He persuaded his new masters that he was in a position to
organize a military coup in Baghdad."
Exiled Allawi was Responsible for 45-Minute WMD Claim
Independent, 29 May 2004
"As the foreign secretary, Jack Straw,
was once again forced to defend the justification for going to war, the Iraqi exile group
in London which claims to have supplied MI6 with the intelligence about Saddam's 45-minute capability admitted that
the information might have been completely untrue. Nick Theros, the Washington
representative of Iyad Allawi, who headed the Iraqi National Accord in exile, said it was
raw intelligence from a single source, part of a large amount of information passed on by the INA to MI6. He told the Guardian:
'We were passing it on in good faith. It was for the
intelligence services to verify it.'... The claim
that Saddam could deploy chemical or biological weapons within 45 minutes was highlighted
by Tony Blair's preface to the dossier issued by the government in September 2002 in the run-up
to the war..... But Mr Theros said the information now seemed to be a 'crock of sh**'.
'Clearly we have not found WMD,' he said. Mr Theros works with his father, a former US
ambassador, to promote the political affairs of Mr Allawi, who is now a member of the
Iraqi governing council in Baghdad. He said the Iraqi
officer who claims to have been the original source of the intelligence had in fact never
seen inside the purported chemical weapons crates upon which his 45-minute claim was based. The former INA spy, who calls himself Lieutenant Colonel al-Dabbagh,
although this is not his full name, is now said to be 'in hiding'. At the time, he says,
he commanded a frontline unit. He told the Sunday Telegraph and NBC television that before
the September 2002 dossier was published he smuggled out sketchy intelligence about WMD to
MI6 via a
general in Baghdad working for the INA...... Sir Richard Dearlove, head of MI6, did not deny in
evidence to the Hutton inquiry that the intelligence
for the 45-minute WMD claim came second-hand from a single source who was a senior Iraqi army officer."
Iraqi who gave MI6 45-minute claim says it was untrue
Guardian, 27 January
2004
"Lord Browne, chief executive of BP and one of New Labour's favourite industrialists, has warned Washington not to
carve up Iraq for its own oil companies in the aftermath of any future war. The comments
from the most senior European oil executive.... will ... serve to underline concern that
the US is primarily concerned with seizing control of Saddam Hussein's oil and handing it
over to companies such as ExxonMobil rather than destroying his weapons of mass
destruction..... Lord Browne's views will be listened to carefully in
Downing Street because the BP executive team has such close links with the UK government that it was
once dubbed Blair Petroleum. A number of former BP executives, such as Lord Simon, have been seconded into
Whitehall while one of Mr Blair's personal assistants, Anji
Hunter, joined Lord Browne's team."
BP chief fears US will carve up Iraqi oil riches
Guardian, 30 October
2002
"[BP's] Lord Browne's said that most
exploration for new supplies had halted [in Iraq] when the Iraqis nationalised their
industry.... he believed there was a plenty
of oil and gas waiting to be discovered in Iraq and that BP should be in prime position to
capitalise [after a war with Iraq] because
it had found most of the country's oil before being thrown out in the 1970s...."
BP chief fears US will carve up Iraqi oil riches
Guardian, 30 October 2002
"While the days of ownership have
long past, BP's ties with the British government are still so close that
rivals call it 'Blair Petroleum'...One Whitehall insider says there is a 'meeting of minds'
between Tony Blair and Browne, who is a regular visitor to Downing Street. Both men admire
the other's leadership... This rapport is reinforced by the presence on Browne's staff of
former New Labour officials still close to Number 10. Anji Hunter, Blair's childhood
friend and former special assistant, is Browne's director of communications. Nick Butler,
strategic policy adviser, is a former Labour candidate and friend of Jonathan Powell,
Blair's chief of staff... Browne has encouraged BP managers to make use of secondment programmes to ministries,
mostly the Department of Trade and Industry, but also the Foreign
Office and Treasury. There are
four BP employees at the DTI. "
Oiling the political engine
Financial Times, 2 August 2002
"Fuel is our economic lifeblood. The
price of oil can be the difference between recession and recovery. The western world is
import dependent. ....So: who develops oil and gas, what the new potential sources of
supply are, is a vital strategic question...The
Middle East, we focus on naturally."
Prime Minister's speech at the George Bush Senior Presidential
Library, Texas
10
Downing St, 7 April 2002
2001
(New Labour Gets Closer To The BP Cash Cow)
"Lord Browne took over at BP,
nicknamed 'Blair Petroleum' on account of its intense new Labour contacts, in 1995, one
year after Mr Blair became the opposition leader. [Lord
Browne] was knighted in 1998 and made a life peer by Mr Blair in 2001. The
friendship and cooperation has been close."
BP was nicknamed Blair Petroleum
London Times,
2 May 2007
"The
UK oil giant BP made a profit of £9.75bn ($14.2bn) in 2000. Shell and Exxon Mobil have also seen profits hit record levels. With
this in mind Chancellor Gordon Brown is considering moves to introduce a windfall
tax to stop oil companies from profiteering."
Petrol profits: Should there be a windfall tax?
BBC Online, 16 February
2001
"The woman seen as Prime Minister
Tony Blair's closest and most trusted aide is to leave the government for a job at oil giant BP.... [Anji Hunter] has been a permanent fixture at the prime
minister's side since he first became Labour leader in 1994 ...[and] is widely seen as the
prime minister's door keeper..."
Blair's closest aide resigns
BBC
Online, 8 November 2001
"Anji
Hunter will be among New Labour friends when she starts her new job as director of
communications at BP - nicknamed Blair Petroleum for
its close links with the government. The chief executive John Browne is close to the prime
minister and a grateful Mr Blair added a peerage to the oilman's knighthood after he
helped end the fuel protests of summer last year. Ms Hunter knows Lord Browne well from
his frequent trips to No 10 and she is on first name terms with Nick Butler, an unofficial Blairite adviser who is the oil giant's policy chief....Barely a month after Peter Mandelson was forced to quit as trade and
industry secretary over his secret £373,000 cheap home loan from Geoffrey Robinson, BP
paid his hotel and travel expenses to a conference in Paris, according to the register of
members' interests...BP and Labour point out the company also has close ties with some
leading Tories; both the former chancellor Lord Howe and the ex-foreign office minister
Lord Garel-Jones bank cheques as advisers. Nevertheless, BP
appears to have been embraced by the New Labour establishment and is thought to be the
government's favourite oil giant."
Among friends at 'Blair Petroleum'
Guardian, 9
November 2001
2000
"The 2000 Budget could mark a
watershed in the relations between the Labour Party and the business community.... The CBI
has also joined in criticism of the government for boosting taxes
on companies' foreign earnings, which some big firms
say will cost them billions of pounds..... Many prominent Labour business supporters have
now left the government, or their businesses.... Prominent businessmen Lord Simon of BP, and
Geoffrey Robinson have both left the government...."
Budget alienates business
BBC Online, 29 March 2000
1999
"As far back as 1999, he had Iraq on his mind. In a speech in Chicago at the height of the Kosovo crisis, Blair explicitly linked Milosevic with Saddam Hussein: 'two dangerous and ruthless men.'"
Why You'll Miss Tony Blair
TIME, 3 May 2007
"Mr Hoon also expressed regret over
the government's claim in the run-up to war that Saddam Hussein possessed weapons of mass
destruction, which, he now accepts, turned out to be false. He said he had 'gradually come
to the acceptance' the weapons did not exist. But he insisted the government had acted in
good faith. He still does not understand why the
intelligence proved to be false. 'I've been present
at a number of meetings where the intelligence community was fixed, and looked in the eye
and asked are you absolutely sure about this? And the answer came back 'Yes, absolutely
sure'. Mr Hoon added: 'I saw intelligence from the
first time I came into office, in May 1999 - week in, week out - that said Saddam had weapons of mass destruction ... I have real
difficulty in understanding why it was, over such a long period of time, we were told this
and, moreover, why we acted upon it.... ' 'Whatever else I did, even if say people say it
was catastrophically wrong, I wouldn't agree with it, but I could live with it. But I
can't live with the idea that I was telling lies, because I wasn't."
Hoon admits fatal errors in planning for postwar Iraq
Guardian, 2 May 2007
(see 1997 below for the answer to Hoon's puzzlement)
1998
"The merger of BP and Amoco is
creating one of the strongest energy and petrochemical companies in the world, with a
market capitalisation of $110bn and interests in more than 70 countries world wide. Before
the deal, BP boasted a turnover of £43.5bn ($71bn), had 56,450 employees world wide and
produced 1.25m barrels oil per day. The Amoco merger propels BP into a new dimension and
is possibly the high point in the history of the company which was first registered in
1909 under the name Anglo-Persian Oil. But the company's origins go back to 1901, when a wealthy Englishman,
William Knox D'Arcy, ventured into the Iranian desert to search for oil....1951 was a
crucial year in the company's history. Iran decided to nationalise the company's assets,
which back then were the UK's largest single investment overseas. Three years later the
conflict was resolved - in the same year that the company was renamed British Petroleum
Company.....The Iranian crisis had convinced BP that it had to broaden its activities. In
the following years the company started explorations in other Middle East countries, like
Kuwait, Libya and Iraq. But its most important moves were into the North Sea and Alaska in
the 1960s. Finding oil in British waters and discovering the biggest oilfield in the
United States at Prudhoe Bay in Alaska transformed the company....A new management, under
Lord Simon of Highbury, Peter Sutherland and later Sir John Browne, set tough targets for
debt reduction, profitability and cost-cutting. Four years later profits trebled, and BP
had managed a turn-around - moving from the bottom of the industry into the top quarter.
Now, 97 years after William Knox D'Arcy set off to explore the Iranian desert, the company
has transformed itself into BP Amoco, one of the world's largest oil producers, and Britain's largest company."
Business: The Company File From Anglo-Persian Oil to BP Amoco
BBC Online, 11
August 1998
"[Azerbaijani dictator President]
Aliyev's arrival was welcomed by Britain and America, which have a strategic interest in
securing oil rights.... Blair gave [Aliyev] red-carpet treatment when he visited London in
1998 to sign a friendship treaty and $13 billion (£9.5 billion) in
contracts with BP and other British firms...."
BP accused of backing 'arms for oil' coup
Sunday Times, 26 March 2000
"It wasnt supposed to be like
this. Tomorrow New Labours ethical policy will drown symbolically in a poisonous
cocktail of blood and oil when the Queen shakes hands with Azerbaijans
President Aliev. Her Majesty may be forgiven for
thinking this is one export-driven photo-opportunity too many. The Queen has dutifully
entertained tyrants of all stripes but she has never had to shake hands with a SMERSH agent before.... Today, as
President of Azerbaijan his secret police regularly arrest scores of critics allegedly
plotting against him and thousands languish in his old haunts, the ex-KGB prisons. Others
simply disappear. Yet Alievs Azerbaijan is respectable. There is one word to explain this bizarre fact: Oil.... Azeri democracy was uniquely
Aliev-style.... oil decreed that Aliev had won 98.9% of the votes - a modest 1% fall from
his last Soviet-era total... A gaggle of ex-Tory MPs and former Foreign Office diplomats
know the value of keeping in with Aliev. So does a host of stars of George Bushs
Administration... [now] Tony Blair is wining and dining Aliev..."
Aliev In Britain
Daily Mail, 20 July 1998
"Lord Browne took over at BP, nicknamed 'Blair Petroleum' on account of its intense new Labour contacts, in 1995, one year after Mr Blair became the opposition leader. [Lord Browne] was knighted in 1998 and made a life peer by Mr Blair in 2001. The friendship and cooperation has been close."
BP was nicknamed Blair Petroleum
London Times, 2 May 2007
"'Blair
started talking about getting rid of Saddam Hussein way before September 11 ... in 1998. So I think that on Iraq he was
more ready than Bush, who only really came into this conversation after 9/11."
Lady Catherine Meyer, wife of former British US Ambassador, Christopher Meyer
Independent, 20
March 2007
1997
"The friendship and cooperation has
been close. In 1997 the Prime Minister loaned Number 10 to Lord Browne for a deal-signing
ceremony between BP and Sidanco, a Russian oil company."
BP was nicknamed Blair Petroleum
London Times,
2 May 2007
"Tony Blair yesterday appointed Sir
David Simon, one of the country's most pro-European industrialists, as a minister
responsible for promoting British business in Brussels. Sir David, the chairman of British Petroleum
and a strong advocate of the single currency, was made Minister for Trade and
Competitiveness in Europe. The new post is attached to the Department
of Trade and Industry and the Treasury. The Queen will give Sir David a peerage to allow him to carry out
his role. He resigned from BP yesterday to dedicate
himself to Government, but he will not draw the £31,125 salary. The Prime Minister said
the appointment of a top industrialist to a key Government post showed his determination
to build 'a modern and dynamic economy in partnership with business.'"
BP chairman to be EU Minister
Daily
Telegraph, 8 May 1997
"Last September
24th, as Congress prepared to vote on the resolution authorizing President George W. Bush
to wage war in Iraq, a group of senior intelligence officials, including George Tenet,
the Director of Central Intelligence, briefed the Senate Foreign Relations Committee on
Iraqs weapons capability.....According to two of those present at the briefing....
this time the argument that Iraq had a nuclear program under way was buttressed by a new
and striking fact: the C.I.A. had recently received
intelligence showing that, between 1999 and 2001, Iraq had
attempted to buy five hundred tons of uranium oxide from Niger, one of the worlds
largest producers... On the same
day, in London, Tony Blairs government made public a dossier containing much of the
information that the Senate committee was being given in secretthat Iraq had sought
to buy 'significant quantities of uranium' from an unnamed African country... President Bush cited the uranium deal, along with the aluminum tubes,
in his State of the Union Message, on January 28th, while crediting Britain as the source
of the information: The British government has learned that Saddam Hussein recently sought 'significant quantities
of uranium from Africa.'....Then the story fell apart. On March 7th, Mohamed ElBaradei, the director-general of the International
Atomic Energy Agency, in Vienna, told the U.N. Security Council that the documents
involving the Niger-Iraq uranium sale were fakes....
Some I.A.E.A. investigators.... speculated that MI6the branch of British intelligence responsible for foreign
operationshad become involved, perhaps through contacts in Italy.... Forged documents and false accusations have been an element in U.S. and
British policy toward Iraq at least since the fall of 1997, after an impasse over U.N. inspections....A former Clinton
Administration official told me that London had resorted to, among other things, spreading
false information about Iraq. The British propaganda
programpart of its Information Operations, or I/Opswas known to a few senior
officials in Washington.... dozens of unverified and unverifiable intelligence reports and
tipsdata known as inactionable intelligence[were] to be funnelled to MI6
operatives and quietly passed along to newspapers in London and elsewhere. 'It was intelligence that was crap, and that we
couldnt move on, but the Brits wanted to plant stories in England and around the
world,' the former officer said. There was a series of clandestine meetings with MI6, at
which documents were provided, as well as quiet meetings, usually at safe houses in the
Washington area..... None of the past and present officials I spoke with were able to
categorically state that the fake Niger documents were created or instigated by the same
propaganda office in MI6 that had been part of the anti-Iraq propaganda wars in the late
nineteen-nineties (An MI6 intelligence source declined to comment.)....[However] What is generally agreed upon, a congressional
intelligence-committee staff member told me, is that the Niger documents were initially
circulated by the BritishPresident Bush said
as much in his State of the Union speechand that 'the Brits placed more stock in
them than we did.' It is also clear, as the former high-level intelligence official told
me, that 'something as bizarre as Niger raises suspicions everywhere.'... "
WHO LIED TO WHOM?
New
Yorker, 24 March 2003
"The Secret Intelligence Service has
run an operation to gain public support for sanctions and the use of military force in
Iraq. The government yesterday confirmed that MI6 had organised Operation Mass Appeal,
a campaign to plant stories in the media about Saddam Hussein's weapons of mass
destruction. The revelation will create embarrassing questions for Tony Blair in the
run-up to the publication of the report by Lord Hutton into the circumstances surrounding
the death of Dr David Kelly, the government weapons expert. A senior official admitted
that MI6 had
been at the heart of a campaign launched in the late 1990s to spread information about
Saddam's development of nerve agents and other weapons, but denied that it had planted
misinformation. 'There were things about Saddam's regime and his weapons that the public
needed to know, said the official. The admission followed claims by Scott Ritter, who led
14 inspection missions in Iraq, that MI6 had recruited him in 1997 to help with the propaganda effort. He described meetings where the
senior officer and at least two other MI6 staff had discussed ways to manipulate intelligence material. 'The aim
was to convince the public that Iraq was a far greater threat than it actually was,'
Ritter said last week. He said there was evidence that MI6 continued to use similar propaganda tactics up to the invasion of Iraq
earlier this year. 'Stories ran in the media about secret underground facilities in Iraq
and ongoing programmes (to produce weapons of mass destruction),' said Ritter. 'They were
sourced to western intelligence and all of them were garbage.' .....Blair justified his
backing for sanctions and for the invasion of Iraq on the grounds that intelligence
reports showed Saddam was working to acquire chemical, biological and nuclear weapons. The
use of MI6 as a
'back channel' for promoting the government's policies on Iraq was never discovered during
the Hutton inquiry and is likely to cause considerable disquiet among MPs. A key figure in
Operation Mass Appeal was Sir Derek Plumbly, then director of the Middle East department
at the Foreign Office and now Britain's ambassador to Egypt. Plumbly worked closely with MI6 to help to promote
Britain's Middle East policy. The campaign was judged to be having a successful effect on
public opinion. MI6 passed on intelligence that Iraq was hiding weapons of mass destruction
and rebuilding its arsenal. Poland, India and South Africa were initially chosen as
targets for the campaign because they were non-aligned UN countries not supporting the
British and US position on sanctions. At the time, in 1997, Poland was also a member of the UN security council. Ritter was a
willing accomplice to the alleged propaganda effort when first approached by MI6's station chief in New
York. He obtained approval to co-operate from Richard Butler, then executive chairman of
the UN Special Commission on Iraq Disarmament. Ritter met MI6 to discuss Operation Mass Appeal at a lunch in London in June 1998 at which two men and a
woman from MI6
were present. The Sunday Times is prevented by the Official Secrets Act from publishing
their names. Ritter had previously met the MI6 officer at Vauxhall Cross, the service's London headquarters. He asked
Ritter for information on Iraq that could be planted in newspapers in India, Poland and
South Africa from where it would 'feed back' to Britain and America. Ritter opposed the
Iraq war but this is the first time that he has named members of British intelligence as
being involved in a propaganda campaign. He said he had decided to 'name names' because he
was frustrated at 'an official cover-up' and the 'misuse of intelligence'. 'What MI6 was determined to do by
the selective use of intelligence was to give the impression that Saddam still had WMDs or
was making them and thereby legitimise sanctions and military action against Iraq,' he
said."
Revealed: how MI6 sold the Iraq war
Sunday
Times, 28 December 2003
1995
"Lord Browne took over at BP,
nicknamed 'Blair Petroleum' on account of its intense new Labour contacts, in 1995, one year after Mr
Blair became the opposition leader. "
BP was nicknamed Blair Petroleum
London Times,
2 May 2007
"A private intelligence firm with
close links to MI6 spied on environmental campaign groups to collect information for oil companies, including
Shell and BP.
MPs are to demand an inquiry by Jack Straw, the foreign secretary, into whether the secret
intelligence service used the firm as a front to spy on green activists. The firm's agent,
who posed as a left-wing sympathizer and film maker, was asked to betray plans of
Greenpeace's activities against oil giants. He also tried to dupe Anita Roddick's Body
Shop group to pass on information about its opposition to Shell drilling for oil in a
Nigerian tribal land. The Sunday Times has seen documents which show that the spy,
German-born Manfred Schlickenrieder, was hired by Hakluyt, an agency that operates from offices in London's West End.
Schlickenrieder was hired by Mike Reynolds, a
director of Hakluyt and MI6's former head of station in Germany. His cover was blown by a female colleague who had worked with him. Last
night he refused to comment. Reynolds and other MI6
executives left the intelligence service after the cold war ended to form Hakluyt in 1995. It was set up with the blessing of Sir
David Spedding, the then chief of MI6, who died last week. Christopher James, the managing
director, had been head of the MI6 section that liaised with British firms. The firm, which takes its name from Richard Hakluyt, the Elizabethan
geographer, assembled a foundation board of directors from the Establishment to oversee
its activities, including Sir Fitzroy Maclean, Ian Fleming's model for James Bond.
Baroness Smith, the widow of John Smith, the late Labour leader, was a director until the
end of last year. The company has close links to the
oil industry through Sir Peter Cazalet, the former deputy
chairman of BP, who helped to establish Hakluyt before he
retired, last year, and Sir Peter Holmes, former chairman of Shell,
who is president of its foundation. MPs believe the
affair poses serious questions about the blurring of the divisions between the secret service, a private intelligence company and the
interests of big companies. Hakluyt refutes claims by some in the intelligence community that it was started by MI6 officers to carry out 'deniable' operations.... Hakluyt was reluctant to discuss its activities. Michael Maclay, one
of the agency's directors and a former special adviser to Douglas Hurd when he was
Conservative foreign minister, said: 'We don't ever talk about anything we do. We never go
into any details of what we may or what we may not be doing.'"
MI6 'Firm' Spied on Green Groups
Sunday
Times, 17 June 2001
1993
(Iraq Deja Vue - BP/MI6 Regime Change
In Azerbaijan)
"In September 1992, BP pulled off a
coup that unnerved its competitors and appeared to put the British firm back on top.
Former British prime minister Margaret Thatcher arrived in Baku and handed the Azerbaijani
government two BP checks totaling $30 million. The money was a down payment for a proven
field called Chirag and for an unproven bloc called Shak-Deniz. To Azerbaijani officials,
a deal with BP was tantamount to a deal with the British government; not only did visiting British officials lobby relentlessly for the
company, but for months Britain's diplomatic mission to Azerbaijan had operated out of the BP offices."
A British 'Coup'
Washington
Post, 4 October 1998
1989
(Fall Of Berlin Wall)
"Duplicity and chicanery are their
stock-in-trade, so is it any surprise that spies sometimes break their own rules? More
surprising is the mess that [MI6] the Secret
Intelligence Service (SIS) has made of dealing with
Richard Tomlinson, a renegade spook whom it fired in 1995. Running a secret intelligence
organisation is a difficult business, now that the moral
discipline of the cold war has crumbled: when spying for your country is about making its big businesses
richer, rather than subverting totalitarianism,
patriotism may not be enough to keep a disgruntled ex-employee quiet."
Breach birth
The
Economist, 25 January 2001
"With the end of the Cold War, MI6's role
has fundamentally changed and it now has many more potential targets.
Terrorist groups, and so-called 'rogue' states, are now high profile targets.
Networks of new agents will be required as intelligence 'needs' constantly
shift. Industrial espionage, furthering British trade interests has moved into the area of national
interest. Gathering intelligence on friendly governments, obtaining advanced knowledge of
their negotiating positions or changes in alliances, are also now ever more
important targets for MI6. The Intelligence Services Act 1994 formerly acknowledged its
existence.... R6 Industrial, Commercial &
Financial. Worked closely with both the Treasury and the Bank of England, as well as
Merchant Bankers such as Hill Samuel; Hambro's; Kleinwort Benson; Morgan Grenfell;
Brandts; Cootes and the Midland. Solicitors firms such as Slaughter & May were also
part of the network of important contacts, along with Thomas Cook; ICI; BP; Shell; Lonrho and RTZ."
The Mechanisms of an Oppressive State - UK Intelligence And Security Report
AFI Research, August
2003
"Britain
came under unprecedented pressure from its European partners yesterday to reveal the
extent of its involvement in a US-led spying network said to be used for industrial
espionage. Portugal, the current holder of the
European Union presidency, announced it would raise the issue at a forthcoming meeting of
interior ministers, despite formal insistence from London that nothing illegal was taking
place. Britain and the US both wrote to the EU's enterprise commissioner, Erkki Liikanen
of Finland, to say that they were doing no wrong, but a heated European parliament debate
on the Echelon
electronic surveillance system left open the possibility that MEPs would demand a formal
investigation into the allegations. And Britain's letter, written by its EU ambassador Sir
Stephen Wall, fuelled speculation by referring to 'safeguarding
the nation's economic well-being' as one of the
reasons for which telecommunications could be legally intercepted. But he denied that
British facilities were used by other states to gain commercial advantage. Echelon,
established during the cold war and operated by the US, Britain, Canada, Australia and New
Zealand, is reportedly capable of intercepting millions of telephone, fax and email
messages. James Woolsey, who headed the CIA from 1993-95, has already admitted what to
many had long seemed obvious - that the US secretly collects information on European
firms.... Until yesterday, Echelon was a minor issue rumbling along almost unnoticed in the European
parliament. But Portugal's surprise decision to raise it in the council of ministers puts
it into a different league. It will alarm British ministers concerned about the image of
an either-or-choice between the US or Europe. It will
also boost interest in the intelligence services at a time when allegations about Libyan dirty tricks and the
loss of laptops by secret agents is attracting unwelcome attention.... Duncan Campbell,
the British investigative journalist, has claimed that the US used Echelon to beat the
European consortium Airbus to a major plane deal with Saudi Arabia in 1994... Robert
Evans, a Labour MEP, said British MEPs would block calls for an investigation."
Britain accused of aiding industrial espionage by US
Guardian, 31
March 2000
1956
(Lies For Oil - The British Prime Minister And His Foreign Intelligence Service)
"The underground bunkers beneath
Whitehall had been busy since July, and the 'arthritic' British war machine was already
creaking into action. A top-secret meeting at Sèvres between the three allies (the Israelis turning up in hats and dark
glasses) to plot the final moves was foolishly recorded on paper. Eden was thrown into a
panic. The French and Israelis refused to destroy their copies, but the evidence was
clear: a squirming Eden was up to no good."
The long shadow
Guardian, 4 November
2006
"At the official level Eden's immediate response was refined both by Whitehall planning, lead by
the Foreign Office, and by discussions with the US government..... Britain's foreign intelligence service MI6 wanted to go
much, much, further. Under the American
Freedom of Information Act I've obtained a CIA memorandum from April 1st 1956. Presented
for the first time in a documentary, it records two days of meetings between MI6 Deputy Director, George Young,
and his CIA counterparts."
Professor Scot Lucas
Suez - The Missing Dimension
'Archive Hour' Interview, BBC Radio 4, 28 October
2006
The Suez Conspiracy "Following emerged as MI6 position. Nasser's
aims are the total destruction of Israel, Egyptian domination of all Arab governments, and
elimination of all western positions in the Arab area. In order to realise his ambitions
Nasser has accepted full scale collaboration with the Soviets. Nasser has now taken the
initiative for the extension of Soviet influence in Syria, Libya, and French North Africa.
Nasser must therefore be regarded as out-and-out Soviet instrument. MI6 asserted that it is now
British government view that western interests in the Middle East, particularly oil, must be preserved
from Egyptian-Soviet threat at all costs." "You find that people in MI6 were conducting quite
separate policies..... quite regardless of what the Foreign Office view was. I
was astonished when somebody showed me some document written by an acquaintance of mine in
MI6. I
wouldn't have recognised it at all as being anything like British policy, but it was set
out as being so. These secret people, you see, they get so above themselves, if I might
say so." "I remember that I went to see Dick White [Head of MI6] who was an old friend of mine. And he told me that MI6 had information, which he regarded as reliable, that there was a body of dissidents in Cairo who were prepared to stage a revolt and upset Nasser, if allied forces approached the capital. I remember feeling extremely sceptical about this, and in fact if there were any such dissidents prepared to do anything, Nasser had absolutely no difficulty in dealing with them.... It took me no time at all to realise that things were not being handled in the proper traditional way. Instead of the military's directors of plans making plans for a possible military operation, they were being handled by special planning staff. What surprised me enormously was that no Foreign Office adviser was sitting with these planners. I went to see the Cabinet Secretary Norman Brook in London. I said to him that I thought it was a pretty good shambles. And I remember that he smiled and made no comment. He certainly didn't deny it."Patrick Reilly, Foreign Office Assistant Under Secretary Of State 1956, interviewed decades later Suez - The Missing Dimension 'Archive Hour' Interview, BBC Radio 4, 28 October 2006 "All the time here he [Eden] was with this personal declaration of war against Nasser, but no means of putting it into effect. Because although Nasser had nationalised the Suez Canal Company he hadn't given us any casus belli, he hadn't actually stopped a ship, or arrested a British subject, or shot anybody, or done anything which would give us the opportunity to go in and invade. And then suddenly the French came up with this plan whereby the Israelis would take the initiative, they would invade Egyptian Territory, they would march to the Suez Canal, and Britain and France would then intervene in order, so the declaration would read, to separate the combatants, to put out this most dangerous fire which had started in the Middle East and to land troops between the two - well, on the Suez Canal. So we would then in effect retake possession of the Suez Canal and the Suez Canal Company, and this in its turn would be such a humiliation for President Nasser that he would be toppled from his perch. It was as if suddenly the heavens had opened, and here was the opportunity at last. I was allowed to consult two officials at the Foreign Office - Permanent Under Secretary, and the Under Secretary in charge of the Middle Eastern area. Nobody was to be told."Anthony Nutting, Foreign Office Minister of State 1956, interviewed decades later Suez - The Missing Dimension 'Archive Hour' Interview, BBC Radio 4, 28 October 2006 "All my life I have been a
man of peace, working for peace, striving for peace, negotiating for peace. I've been a
League of Nations man, and a United Nations man, and I'm still the same man with the same
conviction, the same devotion to peace. I couldn't be other even if I wished. But I'm
utterly convinced that the action we have taken is right." Suez - The Missing Dimension 'Archive Hour' Interview, BBC Radio 4, 28 October 2006 "I was increasingly aware
that people had been hiding things, in particular that you couldn't trust a damn thing
that the politicians or the Foreign Office said...." |
"With
hindsight it's clear that Eden was already committed to military action [against
Egypt in 1956]. Approaching the problem through the United Nations was
unlikely to work, since in international law Nasser
probably was within his rights to nationalise the Suez Canal Company. With the likelihood
of armed conflict in mind, in fact Eden would ultimately engage in an illegal secret pact with
France and Israel to provide a pretext to start it..... no one outside of a
very few close confidants knew of Eden's single minded commitment to a military solution,
and still less about the very secret plan hatched with the French and Israelis to provide
a pretext for that military action to start....
Government preparations for war went largely unreported in detail having been the subject
of two 'D' notices. That's the system by which press and broadcasters agree voluntarily to
restrict reporting of matters relating to national security. Meanwhile unknown to any but
his closest inner circle the plan for the Israelis to
invade Egypt, thus allowing Britain and France to
intervene on the pretext of keeping the waring sides apart, was ready to be put into action."
'A Comfort to the Enemy'
BBC Archive Hour, Saturday 4
November 2006 20:00-21:00 (Radio 4 FM)
"The Suez Crisis, which occurred 50
years ago, was the full stop at the end of the British Empire......Middle Eastern oil was as essential, in 1956 as now, to the
economy and security of the United States, Europe and world trade..... Only in October did Eden adopt the
joint Anglo-French-Israeli plan that was indeed a disaster..... The world community had
an essential interest in the free flow of oil through the canal."
Lord William Rees-Mogg
Suez: why I blame it on Ike
London Times, 24 July
2006
"The intelligence dossiers which
asserted that Iraq possessed weapons of mass destruction represented the agreed truth at
the time - shared by '90% of the world', including Hans Blix - but they failed to reflect
the 'thinness' of some of the sources, Lord Butler of Brockwell told MPs yesterday. Making
a skilful defence of his much-criticised report into the pre-war intelligence, Lord Butler insisted that no one - neither Tony Blair nor John
Scarlett, now head of M16 - could be held responsible....
The circulation of papers to cabinet ministers before their Thursday meetings - which his
committee said should be improved - had been declining since 1945. Faced with the charge
that the decision to go to war was the most personal
by a prime minister since Sir Anthony Eden invaded Suez in 1956, Lord Butler countered that
Lady Thatcher had done the same over the Falklands crisis."
'No one to blame' for flaws in Iraq dossier, Butler tells MPs
Guardian, 22 October
2004
1953
Britain's Long Tradition Of Foreign Policy Scheming
To Prop Up BP As Cash Cow For UK Economy
"He was the Sun King: the brightest
star in British business, a global power and an adored confidant of prime ministers. Then,
last week, he managed to lose both his job and his reputation....On Monday evening Lord Browne of Madingley,
then still chief executive of BP, gathered a few close friends for dinner at his home in
Chelsea. The mood was sombre; for John Browne, who had entertained Tony Blair and Gordon
Brown at the same table, this was a humble last supper....Dapper, diminutive and urbane,
Browne has always seemed the antithesis of the Texan oilman portrayed in Hollywood films.
But oil was in Browne's blood: his father, a former Army officer, worked for the Anglo-Persian oil company, the forerunner of BP."
End of the affair
Daily
Telegraph, 5 May 2007
"Action of both houses of the Iranian
Parliament in voting to nationalize the oil industry again had focused attention on the
Middle East to which the center of gravity of the world's oil production is being shifted
rapidly. Coming in the midst of negotiations with the Anglo-Iranian
Oil Company, Ltd., to revise the present agreement,
the proposed nationalization move may be for the purpose of getting better terms from that
company, the only important factor in oil operations there. Since Anglo-Iranian is owned
by British interests, with the British Government holding a majority of the stock,
nationalization of the Iranian oil properties would
be a severe blow to the British economy. With
current production about 700,000 barrels of crude oil daily, the loss of revenue to the
British would sharply reduce the amount of exchange available for the purchase of raw
materials. Already hard pressed to obtain enough foreign exchange to make the necessary
purchases of raw materials abroad, Britain had been
relying largely on its foreign oil operations to meet the exchange deficiency over the next few years. To do this, a vast expansion of its Middle East
oil operations, including those in Iran, had been projected. Realizing the importance of
Middle East oil to British economy, the United States Government, since the end of World
War II, through Marshall Plan funds and other aid, has been pushing the expansion of
refineries in Europe for the processing of that oil. Through this program, it had been
hoped that by the end of 1952, Europe would have a refining capacity capable of meeting
its oil needs and that the crude oil to be processed by the refineries would come from the
Middle East where British interests have roughly one-half of its estimated petroleum
reserves, which represent probably one-third of the world's total. Involved in the
proposed Iranian nationalization project is the world's largest refinery at Abadan.
Processing around 560,000 barrels of crude oil daily, this refinery manufactures a
complete line of petroleum products, ranging from aviation gasoline to heavy fuel oil.
Although some of the products are moved through the
Suez Canal to the United Kingdom and Europe, a large
part are marketed in India and Pakistan, other areas in the Far East, Australia and
Africa. The British have been active in the development of Iranian oil resources for the
past half century. The original concession was obtained by W. K. D'arcy in 1901. Soon
after the discovery of the first production in 1908, the
Anglo-Persian Oil Company, now the Anglo-Iranian Oil Company,
was formed. A pipeline from the discovery site to Abadan was completed in 1911 when the
new refinery also was placed in operation. During
World War I, Winston Churchill, then First Lord of the Admiralty, placed a long-term
contract with the company for fuel oil. Simultaneously the British Government also bought
a majority stock interest in the company."
World Eyes Iran on Oil Seizure Bid
New York
Times, 25 March 1951
"Fifty years ago this week, the CIA
and the British SIS [MI6] orchestrated a coup d'etat that toppled the democratically elected government of Mohammad
Mossadegh [in Iran]. The prime minister and
his nationalist supporters in parliament roused Britain's ire when they nationalised the oil industry
in 1951, which had previously been exclusively controlled by the Anglo-Iranian Oil Company [later
renamed as BP]. Mossadegh argued that Iran should begin profiting from its vast oil reserves.
The British government tried to enlist the Americans
in planning a coup... The crushing of Iran's first democratic government ushered in more than two decades of dictatorship under the Shah... The author of All the Shah's Men, New
York Times reporter Stephen Kinzer, argues that
the coup planted the seeds of resentment against the US in the Middle East, ultimately leading to the events of September 11.... The coup and the culture of covert interference it created
forever changed how the world viewed the US, especially in poor, oppressive countries. For
many Iranians, the coup was a tragedy from which their country has never recovered.
Perhaps because Mossadegh represents a future denied, his memory has approached
myth."
The spectre of Operation Ajax
Guardian, 20 August 2003
More Details
New York
Times document web archive - Click Here
US National Security Archive at
George Washington University - Click Here
"[On
March 22] an informal coalition of local organisations around Britain, with a common
interest in 'peak energy', are launching the 'Peak Energy Tour' a series of events
around the UK to highlight the issue of the peak and subsequent depletion of UK and global
energy supplies. Beginning in London, the tour involves over 30 public and private
presentations that examine the links between energy, climate change, and how the problem
of energy depletion requires that we re-examine the basis for our 'modern'
lifestyle....The UK Peak Energy Tour has been organised by groups around the UK who are
interested in preparing for the global peak in energy supply. Many commentators look on
the economic problems that this peak will create as a looming crisis we view this
moment as an opportunity to develop a movement to change our society, enabling us to
tackle not just energy and resource depletion, but climate change and global inequality as
well. In a series of events around the UK, the Peak Energy tour will present the evidence
for the impending peak in global oil and gas production, and what this means for the
UK....Much of the work to organise the tour has been undertaken by Paul Mobbs, a writer
and researcher on energy and environment issues. During the tour he will be presenting a
number of different events.... In addition to these events, three 'special' events have
been organised in Wales (April 21st), Leeds (28th/29th April) and London (12th May). These
day-long events will provide a more indepth investigation into Peak Energy and the options
for energy descent....Further dates are still being
added in May and early June, and so for the latest information the public should consult
the on-line programme on the tour web site at www.fraw.org.uk/tour/..." |
Pioneering
Welsh Town
Begins The Transition To A Life Without Oil
"Lampeter is the first
in a nationwide series of public meetings on making the transition from cheap
oil the Soil Association is supporting through its One Planet
Agriculture campaign..... The Soil Association is
holding a nationwide series of public meetings on making the transition from cheap
oil to peak oil.Here is an account of the first meeting from Robin
Maynard, director of communications for the Soil Association... [click here to read
account].... Lampeter is the first in a nationwide series of public meetings on making the
transition from cheap oil the Soil Association is supporting through its
One Planet Agriculture campaign."
Soil Association starts nationwide series of meetings on 'peak oil' problem
Farmers
Weekly Interactive, 11 April 2007
| http://environment.guardian.co.uk/energy/story/0,,2051912,00.html
http://www.guardian.co.uk/oil/story/0,,2051911,00.html Pioneering Welsh town begins the transition to a life without oil As the supply of cheap fuel dwindles, rural Lampeter embarks on 'energy descent' Felicity Lawrence Guardian There is, as the ads say, no Plan B. The age of cheap oil is drawing to a close, climate change already threatens, and politicians dither. But the people of Lampeter, a small community in the middle of rural Wales, gathered together earlier this week to mobilise for a new war effort. They decided to plan their "energy descent". It was in fact the biggest public meeting in Lampeter anyone could remember. West Wales has a long tradition of alternative living, but the scale of this was different. More than 450 people filed into the hall in a place where the total population is just 4,000. They had come to turn themselves into a Transition Town - one of a rapidly growing network of places that have decided not to wait for government action, but to prepare for life after oil on their own. First, the coordinator of the Transition Town movement, Rob Hopkins, told them how urgent the crisis is. Hopkins, who helped create the earliest Transition Towns in Kinsale, Ireland, and Totnes, Cornwall, and advises the 20 or so others that have signed up, describes himself as an early topper. He's one of those who think that in the next five years we will have reached peak oil - the point at which half the world's oil reserves have been used up. After that production goes into irreversible and rapid decline and our main source of energy starts running out. Since we have not so far identified another viable energy source to replace it, the only rational response, he said, is to plan our energy descent. "Life after oil will have to look very different." The world, he explained, divides into early toppers and late toppers. The early toppers, made up largely of former industry geological experts, calculate that world oil production has already or will very soon peak. The end of oil is nigh, in other words. The late toppers, made up mostly of more optimistic oil companies, governments and economists, predict we have longer, with peak oil some 20 to 30 years away. "I tend to believe the people with no vested interest, but either way this is one of the most dramatic shifts humanity has had to face," Hopkins warned. By now the people of Lampeter, from ageing hippies to young activists, were shifting in their plastic seats (made with oil) and drawing anxiously on their water bottles (made with oil) if not reaching for their medicines (made with oil). Hopkins told them they were likely to experience a range of common symptoms that accompany initial peak oil awareness. One might be an irrational grasping at infeasible solutions. At hydrogen, for example. No good, running the UK's cars on hydrogen would need 67 Sizewell B nuclear power stations or a wind farm bigger than the south-west region of England. Or what about biofuels? No again, it would take over 25m hectares of arable land to run the UK's vehicles on biodiesel, and the UK only has 5.7m hectares of arable land. We need to eat too. Unfortunately, British farming has evolved "into a system for turning oil into food", reliant on the energy-intensive manufacture of synthetic fertiliser, heavy use of oil-based plastics, and centralised just-in-time distribution systems that also guzzle oil. After Hopkins, Guardian columnist George Monbiot, who lives near Lampeter, tried to cheer them up. Unlike Hopkins, he said he had been persuaded that the end of oil was not nigh, but only nigh-ish. We may have another 10 to 30 years. And there was lots of coal for energy. The problem was that if we switched back to sin fuels that increase our emissions, climate change will undo us even faster than peak oil. The drive for change in Lampeter has come in part from a group of local farmers - both Patrick Holden, the Soil Association's director, and Peter Segger, the businessman who was the first to supply the mass market with organic foods through the supermarkets, have their land nearby. Both have decided that the future lies in selling more of their produce locally instead of having it trucked round the country. Segger and his partner Anne Evans have already switched from supplying the major retailers to selling half their vegetables within Wales.. Holden confessed to a touch of both survivalism and optimism. As an organic farmer who does not use artificial fertiliser, he said he had been feeling smug until he heard Hopkins speak a couple of months ago. But he realised his produce was also part of the problem once it left his farm, feeding into the system of centralised distribution. Now he is trying to make his farm self sufficient in energy: he has already invested in burying half a mile of pipes under a field to extract heat from the soil that keeps his house warm. Four hours into planning their energy descent and over bowls of local cawl broth the crowd in Lampeter were considering what they would like to happen - a ban on advertising that encourages consumption; turning the local supermarket into a giant allotment - and what they could they could actually do - install a community wind turbine; encourage low-energy buildings using sheep's wool for insulation; swap skills. Someone suggested that a local landowner give the town an acre for a community vegetable garden. There was an awkward silence until someone else remembered a playing field that would serve the purpose, if the council agreed. There was plenty of inspiration from pioneer towns. Transition Totnes has introduced its own currency with notes that can only be spent in local shops. Its businesses are being audited by an accountant who provides a wake-up call by identifying parts of their operations that become unprofitable as oil prices rise. The town is planting nut trees which can provide emergency food and timber for construction while also acting as carbon sinks. Lampeter decided emphatically on a show of 450 hands that it would meet again to plan its next stage. And then its people spilled out on a clear spring night into the car park and, just this one last time, drove home. How we use oil · 130kg packaging made from oil-derived plastics is consumed by British households each year. Two-thirds of it is used in food production · 57miles is the average distance a tonne of freight now travels by road. In 1953 it was 21 miles · 95% of our food products require the use of oil, and the supply of food accounts for 21% of Britain's energy use · 3.5 litres of oil is needed to produce half a kilogram of steak |
Harnessing Nature's Giant
Power House
Solar Quantum Dot And Film Technology Rising Over The Horizon
"Rice University
scientists today revealed a breakthrough method for producing molecular specks of
semiconductors called quantum dots, a discovery that could clear the way for better,
cheaper solar energy panels. The research, by scientists at Rice's Center for Biological
and Environmental Nanotechnology (CBEN), appears this week in the journal Small. It
describes a new chemical method for making four-legged cadmium selenide quantum dots,
which previous research has shown to be particularly effective at converting sunlight into
electrical energy. 'Our work knocks down a big
barrier in developing quantum-dot-based photovoltaics as an alternative to the
conventional, more expensive silicon-based solar cells,' said paper co-author and principal investigator Michael Wong, assistant
professor of chemical and biomolecular engineering.... Prior research by others has shown
that four-legged quantum dots, which are called tetrapods, are many times more efficient at converting sunlight into electricity
than regular quantum dots. But, Wong said the
problem is that there is still no good way of producing tetrapods. Current methods lead to
a lot of particles with uneven-length arms, crooked arms, and even missing arms. Even in
the best recipe, 30 percent of the prepared particles are not tetrapods, he said. CBEN's
formula, which was developed by Wong and his graduate student Subashini Asokan with CBEN
Director Vicki Colvin and graduate student Karl Krueger, produces same-sized particles, in
which more than 90 percent are tetrapods."
Quantum Dot Recipe May Lead To Cheaper Solar Panels
ScienceDaily, 4
May 2007
"Within five years,
solar power will be cheap enough to compete with carbon-generated electricity, even in
Britain, Scandinavia or upper Siberia. In a decade, the cost may have fallen so
dramatically that solar cells could undercut oil, gas, coal and nuclear power by up to
half. Technology is leaping ahead of a stale political debate about fossil fuels. Anil
Sethi, the chief executive of the Swiss start-up company Flisom, says he looks forward to
the day - not so far off - when entire cities in
America and Europe generate their heating, lighting and air-conditioning needs from solar
films on buildings with enough left over to feed a surplus back into the grid. The secret? Mr Sethi lovingly cradles a piece of dark polymer foil, as
thin a sheet of paper. It is 200 times lighter than the normal glass-based solar
materials, which require expensive substrates and roof support. Indeed, it is so light it
can be stuck to the sides of buildings. Rather than being manufactured laboriously piece
by piece, it can be mass-produced in cheap rolls like packaging - in any colour. Rather
than being manufactured laboriously piece by piece, it can be mass-produced in cheap rolls
like packaging - in any colour. The 'tipping point' will arrive when the capital cost of
solar power falls below $1 (51p) per watt, roughly the cost of carbon power. We are not
there yet. The best options today vary from $3 to $4 per watt - down from $100 in the late
1970s. Mr Sethi believes his product will cut the cost to 80 cents per watt within five
years, and 50 cents in a decade. It is based on a CIGS (CuInGaSe2) semiconductor compound
that absorbs light by freeing electrons. This is then embedded on the polymer base. It will be ready commercially in late 2009. 'It'll even work on a cold, grey,
cloudy day in England, which still produces 25pc to
30pc of the optimal light level. That is enough, if you cover half the roof,' he said. 'We
don't need subsidies, we just need governments to get out of the way and do no harm. They've spent $170bn subsidising nuclear power over the last
thirty years,' he said. His ultra-light technology,
based on a copper indium compound, can power mobile phones and laptop computers with a
sliver of foil.... The sector is poised to outstrip wind power. It is a remarkable boom
for a technology long dismissed by experts as hopelessly unviable.... Mike Splinter, chief
executive of the US semiconductor group Applied Materials, told me his company is two years away from a solar product that reaches
the magic level of $1 a watt. Cell conversion efficiency and economies of scale are
galloping ahead so fast that the cost will be down to 70 US cents by 2010, with a target
of 30 or 40 cents in a decade.... 'The beauty of
this is that you can use it in rural areas of India without having to lay down power lines
or truck in fuel.' Villages across Asia and Africa that have never seen electricity may
soon leapfrog directly into the solar age, replicating the jump to mobile phones seen in
countries that never had a network of fixed lines. As a by-product, India's rural poor
will stop blanketing the subcontinent with soot from tens of millions of open
stoves."
Monday view: Cheap solar power poised to undercut oil and gas by half
Daily
Telegraph, 18 February 2007
But Meantime
Pressures Continue To Build
Peak Oil 'Newsbites'
| "CEO Jeroen van der Veer is looking beyond
'easy oil' in readily accessible wells and is going
after oil in tar sands, beneath deep waters, in the Arctic and other 'unconventionals,' which
means weathering rough climates and locales." Beyond British Petroleum Newsweek, 16 April 2007 |
| "China's fast-paced economic growthaveraging 9.1% per year in
the last decadecan only be sustained by high energy consumption, an increasing
amount of which will need to be imported. Given global competition for energy resources,
China's energy policy is now focused on securing a steady supply in the medium to long
term..... China has been a net oil importer since 1993, and energy demand is expected to
continue increasing at a greater proportional rate than production. In 2005 China produced
3.6m barrels/day, only slightly up from 2.8m b/d in 1990. China consumed 6.9m b/d in 2005,
representing a 100% increase in consumption in the last decade. This made China the
world's second-largest consumer of petroleum products in 2005, just behind the US. The US
Energy Information Administration estimates that China's consumption will increase to 15m
b/d by 2030, whereas its output will lag behind at 4.2m b/d. The country's energy demand
dictates that it will need to increase both its imports and its suppliers in the next ten
years if it is to avoid shortages. At present, the
bulk of China's oil imports come from the Middle East
(40% in 2005 according to a UK energy company, BP), closely followed by Africa (23%) and
Asia (21%). However, there are strategic risks associated with China's long-term reliance
on these established trading partners. A key risk is
international competition, particularly with regard to the Middle East. With fellow
high-level oil importers such as the US already well established in the region, aggressive
competition will mean that China cannot rely on the Middle East alone to make up its
projected supply shortfall. In any case, China will
be wary about becoming over-reliant on a single supplier, whether a specific country or a
region. This is closely linked to the risk of reliance on politically unstable suppliers
and routes of supply. Of China's top five oil suppliers in 2005, Saudi Arabia, Angola and
Iran remain at risk either of internal political upheaval or terrorist attack. As a
result, China is increasingly looking beyond its immediate sphere of influence...." Growing energy nexus Economist, 10 April 2007 |
| "The days of so-called 'easy oil' are over, making it harder to meet
demand without complicated and expensive projects, the heads of two of Europe's largest
oil companies said today. The International Energy Agency, an adviser to energy importing
nations, estimates oil supply will have to rise 39 percent to 116 million barrels of oil a
day by 2030 from about 86 million barrels a day now to meet world demand. Meeting such
targets with conventional oil sources will be 'extremely difficult,' Christophe de
Margerie, the chief executive officer of Total SA, Europe's third-largest oil company and its largest refiner, said at a
conference in Paris today. New supply will be based on 'huge high-tech' projects. Jeroen
van der Veer, the chief executive officer of Royal
Dutch Shell Plc, Europe's largest oil company, said
countries no longer seek Shell's help with conventional reserves, such as onshore oil or
gas that's cheaper to develop than offshore fields.....Explorers are pushing further
offshore as technology improves and fields onshore and in shallow water run dry." Total, Shell Chief Executives Say `Easy Oil' Is Gone Bloomberg, 5 April 2007 |
| "In March 1971, a Mexican fisherman named Rudesindo Cantarell took a
few geologists from state-run oil company Petroleos Mexicanos to this spot, where he had
seen oil slicks. Mr. Cantarell didn't know it, but he had stumbled across one of the
largest offshore oil fields ever found. A few decades and 12 billion barrels of oil later,
the field that bears Mr. Cantarell's name is dying, and Pemex, as the state-owned company
is known, is struggling to stave off the field's demise. From
January 2006 though February 2007, Cantarell lost a staggering one-fifth of its
production, with daily output falling to 1.6 million barrels from two million. The oil industry was stunned. Cantarell,
which currently produces one of every 50 barrels of oil on the world market, is fading so
fast analysts believe Mexico may become an oil importer in eight years. That would batter Mexico's economy, which depends on oil exports to fund
40% of its government spending. The continued deterioration of the world's second-biggest
field by output would also put pressure on prices on the global oil market, where supplies
are barely keeping up with growing demand as it is. And it would leave the U.S. even more
dependent on Middle Eastern supplies -- and that much more vulnerable to political tumult
in that region. The demise of Cantarell highlights a
global issue: Nearly a quarter of the world's daily
oil output of 85 million barrels is pumped from the biggest 20 fields, according to
estimates from Wood Mackenzie, a Scotland-based oil consulting firm. And many of those
fields, discovered decades ago, could soon follow in Cantarell's footsteps. It's widely
believed that the world's biggest oil fields have already been found. In the decades
leading up to the 1970s, the world discovered eight big fields that produced between
500,000 to one million barrels a day, according to Matthew Simmons, a veteran oil industry
banker. During the 1970s and 1980s, only two were found. Since then, only one -- the
Kashagan field in Kazakhstan -- has the potential to easily top the 500,000 barrel-a-day
mark. Two decades ago, about a dozen fields produced
more than a million barrels a day. Now there are only four, one of which is Cantarell. The future of two others, discovered more than 50 years ago, remains in
question. Some analysts speculate Saudi Arabia's Ghawar, the biggest field by far, could
begin a gradual decline within a decade or so. Another, Kuwait's Burgan, is showing signs
of maturity. In November of 2005, Kuwait Oil Co. lowered its estimate of the field's
sustainable production level to 1.7 million barrels a day from 1.9 million a day." Mexico Tries to Save A Big, Fading Oil Field Wall St Journal, 5 April 2007 |
| "Royal Dutch Shell Plc pumped twice as much oil as it found last
year, forcing the company to rely on traditionally lower-margin natural gas and oil sands
to boost its reserves. Figures issued on Monday echoed a trend across the industry as
resource holders increasingly shun the oil majors.... Shell added more reserves from its
growing oil sands operation in Canada than of conventional crude." Shell 2006 reserves show shift from oil to gas Reuters, 2 April 2007 |
"Alberta being the fourth largest producer
of oil in the world is fairly significant, says John Clinkard, consulting economist with
CanaData. But Clinkard expects that there will be some moderate checks to the oil sands boom
as a number of factors may constrain and create temporary 'pull-backs' in the industry.
The moderate checks may allow breathing room for the industrys talks about skill
shortages, says Clinkard. A major concern voiced by the industry is that the number of
people entering the construction labour force is slowing and the industrys mean age
is high. 'Right now, they are scraping the
bottom of the barrel in terms of getting enough people to assist in this activity and I
dont see that thats going to change,'
adds Clinkard." |
| "President Felipe Calderon has sent federal troops to hot spots
around the country to combat drug traffickers in recent months. But another group of
scofflaws might prove tougher to bring to justice: Mexico's tax cheats. In the next few
weeks, Calderon's administration will unveil a revenue-raising plan that probably will
prove as divisive as it could be pivotal for Mexico's future....Mexico's tax crunch has
been decades in the making. The world's 13th-largest
economy raises tax revenue about as effectively as
Sri Lanka and Kazakhstan as a percentage of its gross domestic product, World Bank data
indicate..... The federal government collects most tax revenue, then redistributes it to
the states. The top-down approach means citizens and local officials have no assurance
that their taxes will stay in their communities to improve streets and schools. The biggest culprit is oil.
Petroleum sales and related taxes have generated more than $335 billion in the past six
years. That gusher of riches has removed the urgency for legislators to act. It's easier
to squeeze more money out of Pemex than to enrage voters with tax increases or tougher
enforcement. Oil revenue last year funded nearly 40
percent of public spending. Now production at the country's largest oil field, Cantarell
in the Gulf of Mexico, is declining rapidly. With
nothing on the horizon to replace it, Calderon knows that Pemex must be allowed to
reinvest more of its earnings to fund exploration and development. Mexico has a little
more than a decade's worth of proven reserves remaining, increasing pressure on Calderon
to make headway on the nation's tax mess during his six-year term." Declining oil pushes Mexico to rethink taxes Los Angeles Times, 31 March 2007 |
| "Our forecasts of the current balance from 2007-08 to 2011-12 are
affected by one major change in the last year - the
sharply lower levels of production and yet higher costs in the North Sea - which have this year reduced tax revenues from £13 billion to £8
billion and for each year into the future cut them by an average of £4 billion a year." Gordon Brown's 2007 budget Reuters, 21 March 2007 |
| "The UK became a net importer of
oil for most of 2006, according to the Oil Depletion
Analysis Centre (ODAC) in Aberdeen. 'It is time for the UK government to let go of the
idea that the UK will be a net oil exporter until 2010 and accept we are now dependent on
imports,' ODAC said. Data published by the UK Department for Trade and Industry
showed that the UK imported oil during every month in 2006 except for June.... Crude oil
production in the UK in 2006 was an estimated 1.6 million b/d, while consumption was an
estimated 1.7 million b/d." ODAC: UK was net oil importer in 2006 Oil and Gas Journal, 13 March 2007 |
"Governor
Richardson told oil and gas investors Wednesday in New York how hed wean the United
States off foreign sources of their product if elected president in 2008. The New Mexico
Democrat says dependence on foreign oil is Americas Achilles heel. Richardson says
hed promote tax breaks for the construction of energy efficient buildings and offer
tax credits for hybrid cars and public transportation. And Richardson says hed
create a system of tradable energy credits to encourage private investment in alternative
energy technologies. Richardson has set a goal of reducing
oil imports by 40 percent and replacing liquid fuels
with biofuels by 2025. Hes also called for a
75 percent reduction in greenhouse gases by 2050." |
| "High feed costs, created by the explosive growth of the fuel ethanol industry, will
lower U.S. beef and broiler chicken output this year by a quarter billion lbs from earlier
forecasts, the U.S. government said on Friday... The Agriculture Department said beef
output would dip by 62 million lbs and chicken by 124 million lbs from last month's
estimate, with total red meat and poultry production forecast for 90.359 billion lbs.
Cattle, hog and poultry feeders say abrupt increases in feed costs -- predominantly corn
-- are squeezing their operations....The ethanol industry is expected to use 2.15 billion
bushels of the 2006 corn crop and 3.2 billion bushels of this year's crop." Ethanol-driven feed costs cut U.S. meat output: USDA Reuters, 11 March 2007 |
| "The accelerating cost of producing oil and gas from new frontiers is
hindering the development of vital reserves west of Shetland, one of the worlds top
oil barons claims. Christophe de Margerie, the chief executive of Total, Frances
largest company, has also questioned whether it is
possible to raise global oil output from todays 85 million barrels per day to 100
million barrels per day, given the cost and
logistical challenge.... He said that the benchmark oil price for developments in
difficult locations is no longer $30 per barrel but $50 per barrel, not far from the
current oil price of just over $60. Mr de Margerie repeated his scepticism about
International Energy Agency (IEA) predictions of oil output of 120 million barrels per day
by 2030. 'There is no chance,' he said. Further warnings about the impact of rising costs
on the oil and gas industry came last week from the Centre for Global Energy Studies
(CGES), which revealed that nonOpec oil production last year rose by only 450,000 barrels
per day, a fraction of the 1.5 million bpd predicted by forecasters. 'The oil industry is
finding it harder and harder to expand upstream capacity,' the CGES writes in its Global
Oil Report. 'Development costs are up sharply, essential equipment and skilled labour are
in short supply and governments want a bigger share of the proceeds. As a result, projects
take longer to complete and output is growing more slowly than predicted.' Growing costs put Shetland oilfield plans in jeopardy London Times, 12 March 2007 |
| "Petróleos Mexicanos (Pemex) reduced by 60% their estimation of
prospective resources in the waters of the Gulf of México, in an area called Deep
Coatzacoalcos, located between Campeche and Tabasco. Carlos Morales Gil, general director
of Pemex Exploración y Producción (PEP) stated that the latest studies done in this oil
province, in depths between 930 and 980 meters (2976 feet and 3136 feet), show that in
this area of 10 thousand square kilometers (6 thousand square miles) there are prospective
resources of 4 billion barrels of oil equivalent. This new information settles up
the calculations made in the middle of the last year, when then president of the republic,
Vicente Fox, overestimated the amount of the prospective resources in this area, when he
calculated them as 10 billion barrels of oil equivalent, based in Pemexs
prospections." Pemex reduces its estimation of prospective resources in the Gulf by 60% La Jornada, 5 March 2007 |
| ".... yesterday, a National Energy Board official said Alberta's
oilsands projects are projected to account for 90 per cent of Canada's total crude oil
output by 2030. 'Total oil output will increase to 4.6 million barrels per day and of this
nearly 4.14 million will be from the oilsands,' said John McCarthy, who spoke at a natural
gas conference in Calgary." Oil extraction costs rise 55 per cent Vancouver Sun, 7 March 2007 |
"Capital costs per peak flowing barrel
of Canada's oil sands are up 55 percent, squeezing returns on investments, a report
released Tuesday said. Edinburgh-Scotland-based Wood Mackenzie, in its report, 'The Cost
of Playing in the Oil Sands,' says despite high land prices, the cost of acquiring acreage
is small compared to the investment required for commercial development. Last year, many
of the top players in the oil sands sector either announced changes to their plans or
reported cost increase, leading to 'an average rise in capex per peak flowing barrel over
the year of 32 percent for integrated mining projects and 26 percent for in-situ
developments. Since 2005, overall costs per peak flowing barrel have increased by around
55,' Wood Mackenzie said in a statement. 'Marginal economics have always been a concern
for companies operating in the oil sands, breakeven prices are high and rates of return
relatively low in comparison with conventional projects, particularly for mining
projects,' said Conor Bint, Upstream Research Analyst - Canada and Alaska for Wood
Mackenzie. The firm said mining projects had an average breakeven price of $28/bbl and IRR
of 16 percent; rates of return were more favorable at the less capital-intensive in-situ
projects, averaging around 22 percent, Wood Mackenzie said. The report attributed much of
the increase in costs to labor shortages and an increase in material costs." |
| "Greenhouse-gas emissions from
Alberta's oil sands would be allowed to rise dramatically under a draft version of the
government's long-anticipated climate-change plan obtained by The Globe and Mail.....The leaked government documents, marked secret and dated Dec. 20,
2006, show that the government was still pursuing a plan at that time based on intensity
targets until at least 2020....Rather than intensity-based targets, environmentalists want
rules for industry to force their total levels of emissions to go down. Preferably, they
would prefer the rules to use the standard of 1990 emission levels, which are used by all
Kyoto signatories. Canada, for instance, agreed to reduce its emissions levels to 6 per
cent below 1990 levels, but emissions are more than 30 per cent above that target. Instead
of using the 1990 baseline, the Conservative plan in the documents uses 2000 as its base
for intensity targets. Separately, it also used 2003, when it said last fall that its
long-term target is to reduce emissions between 45 and 65 per cent from 2003 levels by
2050.....The Pembina Institute has been tracking project announcements by oil-sands companies and said
the documents underestimate the future growth of that sector. The government documents set
a target for the oil sands of reducing the intensity of emissions by 40 per cent by 2020.
If all oil sands projects go ahead, Mr. Bramley said, industry could meet that target
while allowing total greenhouse-gas emissions to rise 248 per cent higher than 2000
emission levels. The documents also appear to acknowledge this, he said." Climate draft allows spike in oil-sands emissions Globe and Mail, 26 February 2007 |
| "In 2007, (oil) demand should grow 1.7mn bpd with the key drivers
being China,
commodity producers and the US, the Institute of International Finance (IIF) said in a
presentation, Outlook for Global Oil Markets, at the 10th annual meeting of
Middle Eastern and North African Bank Chief Executives in Doha yesterday....Non-Opec
supply is expected to grow only 1mn bpd this year with supply growth to come from the
Central Asian region (500,000 bpd), Africa (300,000 bpd), Latin America (170,000 bpd) and
OECD flat with Canada increase offsetting Mexico decline, it said.... The total spare
production capacity in the market dropped to 1.67mn bpd during 2004-06 from 4.7mn bpd in
2002 due to accelerated demand, languished non-Opec supply and Opecs loss of
capacity. Expecting Opec spare capacity to remain at 2.4mn bpd this year, it said Opec production capacity had stagnated around 30.5mn bpd while
spare capacity had fallen precipitously since 1980s. Expressing doubt over Opecs
long term capacity growth, it said: 'the commitment and ability by the lowest price
producers to increase output is dubious.' Oil prices to remain over $65 this year Gulf Times, 24 February 2007 |
| "Unexpected delays have pushed
back Shells time line for possibly beginning commercial oil shale development in
western Colorado... Shell representatives provided
an update on its oil shale efforts during an open house in Rifle Thursday. Company
spokesperson Jill Davis said Shell previously had hoped to switch from research and
development to a commercial phase by the end of this decade. Now its shooting for
early in the next decade, assuming its testing continues to produce positive results.
'Things are still going very well but we need more time,' Davis said. She said the process
of obtaining permits and federal leasing has been taking longer than the company had
expected." Shell pushes back time line for any oil shale development Post Independent, 22 February 2007 |
| "For decades, doomsayers have wailed that we are running out of oil,
and economists have replied smugly that price rises would always bring forth extra supply.
A
new report from the consultancy, Wood Mackenzie, suggests that both may be right and
that will lead to some difficult choices. Wood Mackenzies report identifies 3,600bn
barrels of unconventional reserves such as oil shales and sands.... The good news ends
there, however. The report makes it clear that these reserves might be needed much sooner
than many industry experts had expected. Demand continues to blossom and, while new oil is
always being discovered, many of todays largest fields are in decline. As soon as
2020, conventional production could reach a plateau, leaving unconventional reserves to
take up the slack. If the report is correct a big if then it is worrying.
Unconventional oil is expensive to exploit. The technology is unproven for all but a few
early projects, and engineers are scarce. Unconventional oil production is also an
environmentally damaging mining operation that uses a lot of energy and water to produce
low-quality crudes.... It would be handy to have proven techniques for extracting oil and
gas from unconventional sources in the US and Canada. Society as a whole would benefit
from the increased security of supply but subsidising unconventional production promises
high emissions and plenty of pork with little assurance of success... Governments should
focus more on basic technology and here the scarcity of qualified engineers is as worrying
as the scarcity of oil. The shift to unconventional resources also amplifies the case for
pollution taxes or a credible system of tradable permits... The next few decades will see
a tug-of-war between ever better energy production technology and ever more elusive energy
sources." Unconventional oil: Think of the volumes, not the quality Financial Times, 21 February 2007 |
| "China's dependency on imported oil rose by 47 percent of its annual
demand last year, an increase of 4.1 percentage points from the previous year, sources
with the Ministry of Commerce said yesterday.... Industry observers forecast that in 2007,
China's crude oil output will grow less than 2 percent, while demand for both crude and
oil products will rise by about 6 percent." China's oil dependency to rise China Daily, 14 February 2007 |
| "Oil and gas production in the
North Sea is now expected to be about 10 per cent lower over the next few years than
previously thought, according to the leading survey
of the state of the industry. The faster than expected decline in production is bad news
for Britains energy security, increasing the countrys dependence on imported
oil and gas, and also for the exchequer. The latest annual survey from the UK Offshore
Operators Association, the trade body which gives the most authoritative assessment
of the health of the North Sea, also shows a steep increase in costs and an expected
decline in investment over the next couple of years..... old wells that are running dry
and new wells that are generally very small cast a shadow over the outlook for the North
Sea. Last years production of oil and gas was down 9 per cent at 2.9m boe a day,
according to the association. That is already a steep fall from the peak in 1999 of 4.5m
boe/d in 1999, and the lowest level since 1992. By 2010 production is expected to be
down to just 2.6m boe/d. The main reason, ominously, is described as 'poor reservoir
performance': in other words, wells not yielding as much oil and gas as had been hoped.
But also an increasing amount of resources has been diverted to maintenance on the ageing
infrastructure of the North Sea, some of which dates back to the first oil rush of the
1970s." Fears for North Sea output grow Financial Times, 13 February 2007 |
| "The costs of big new oil and gas production projects have surged
more than 53 percent in the past two years and there are no signs of a slowdown, according
to a new oil and gas production project index launched on Monday. The index, developed by
energy consultancy Cambridge Energy Research Associates (CERA), tracks the costs of a
range of land-based and offshore upstream oil and gas projects around the world.... Deeper
water projects have seen the biggest cost increases, according to the index data, rising
15 percent in the most recent six months..... Ward said CERA had characterized the sharp
increase as a 'double bubble', referring to a sudden rise in costs, but he saw no sign of
it bursting soon. He said the first bubble was the high oil and gas prices from 2003
onwards that persuaded oil and gas companies and governments to 'green-light' new oil and
gas projects. The other bubble was several years of strong growth in the world economy,
led by Asia and in particular China....Daniel Yergin, CERA chairman, said at the beginning
of this decade companies used $20 a barrel as the price against which they tested new
projects, now they used $40 as the floor for oil prices. 'Our short-hand phrase is 40 is
the new 20,' he said.... CERA's analysis showed that while oil prices remain above $55 a
barrel the oil and gas industry will continue to invest in new projects, but if prices
slip below $50 some expansion projects were likely to be canceled or delayed." New oil index points to rise in oil project costs Reuters, 12 February 2007 |
| "Norway dropped to fifth place among the world's crude oil exporters
last year as the nation's North Sea production
declined, the Norwegian energy ministry said. The United Arab Emirates replaced Norway
as the world's third-largest exporter after Saudi Arabia and Russia, Sissel Edvardsen, a
spokeswoman for the ministry, said today in an interview. Iran currently holds fourth
place, she said.... Oil output in Norway totaled 136.6 million standard cubic meters last
year, or about 2.35 million barrels a day, according to figures published by the country's
Petroleum Directorate yesterday. Almost all the oil is exported. By comparison, Saudi
Arabia pumped an average 9.24 million barrels a day of crude oil in 2006, according to
Bloomberg estimates. Iran produced 3.86 million barrels a day and the United Arab Emirates
pumped 2.56 million barrels a day, the estimates showed. Crude oil output in Russia last
year averaged 9.6 million barrels a day, Russia's Energy and Industry Ministry said last
month....Norway's oil output this year will drop to an estimated 129 million standard
cubic meters of oil equivalent, or 2.2 million barrels a day, the petroleum directorate
said in January." Norway Falls to Fifth Place Among World Oil Exporters Bloomberg, 8 February 2007 |
| "Mexican state-run oil monopoly Pemex confirmed a gloomier forecast
on Wednesday for fast-declining oil
output at its aging Cantarell field, but said from now on it could keep total crude
production steady. Chief Executive Jesus Reyes Heroles said the company's official
production estimate for Cantarell was for an average of 1.526 million barrels per day
during 2007, down 15 percent from an average 1.788 million bpd last year. The figure is in
line with recent industry talk but bleaker than Pemex's outlook six months ago when it
forecast Cantarell's output at 1.683 million bpd for 2007 and 1.430 million for 2008.
Reyes Heroles said that with an exploration and production budget of $15 billion a year,
Pemex could keep total crude oil production steady between 3.0 million and 3.1 million bpd
-- also a much less rosy forecast than Pemex was making last year.... Pemex's darkening
outlook reflects worldwide concern over oil production as old gushers dry up and companies
are forced to invest more in exploring harder-to-reach deposits." Mexico's top oil field declining fast - Pemex Reuters, 7 February 2007 |
| "Global oil demand growth is seen rising 2% annually through 2011,
the International Energy Agency said Tuesday, in a forecast that is more optimistic about
the rate of future energy consumption compared with previous five-year periods, because of
rapid growth in Asia. World oil consumption growth is expected to rise on average by 1.8
million barrels a day over the five-year period, from 84.5 million barrels a day in 2006
to 93.3 million barrels a day in 2011, the Paris-based IEA forecast in its medium-term report for 2006-2011.
The 2% annually growth rate in consumption compares with growth of 1.8% in 2001-2006, and
1.4% in the 1996-2001 period.... oil producing nations and international oil companies
need to continue to sink money into new capacity over the next several years. The IEA said
Chinese oil consumption growth is expected to rise annually by 5.7%, more three times the
oil demand growth pace in the U.S., while Middle East countries as a whole will use oil at
an average annual rate of 4.9%." IEA: 2006-2011 Global Oil Demand Growth Seen Rising 2% a Year Dow Jones Newswires, 6 February 2007 |
| "Daily output at Mexico's biggest oil
field tumbled by half a million barrels last year, according to figures released Friday by
the Mexican government. The ongoing decline at the Cantarell field could pressure prices
on the global oil market, complicate U.S. efforts to diversify its oil imports away from
the Middle East, and threaten Mexico's financial stability. The
virtual collapse at Cantarell -- the world's
second-biggest oil field in terms of output at the start of last year -- is unfolding much
faster than projections from Mexico's state-run oil giant Petroleos Mexicanos, or Pemex.
Cantarell's daily output fell to 1.5 million barrels in December compared to 1.99 million
barrels in January, according to figures from the Mexican Energy Ministry. Mexico made up
for some of the field's decline. Mexico's overall oil output fell to just below three
million barrels a day in December, down from almost 3.4 million barrels at the start of
the year. It marked Mexico's lowest rate of oil output since 2000. Mexico's troubles at Cantarell mirror the larger problems in the
global oil market. Many of the world's biggest fields are old and face decline, which can
be sharp and sudden. Like other big producers,
Mexico is struggling to make up the difference because new big fields are in
harder-to-reach places like the deep waters of the Gulf of Mexico." Mexico's Oil Output Cools Dow Jones Newswires, 30 January 2007 |
'Peak Oil'
GLOBAL ENERGY CRISIS LOOMING
www.btinternet.com/~nlpwessex/Documents/energycrisis.htm
"My view is that 'easy' oil has probably passed its peak."
Jeroen van der Veer, CEO of Royal
Dutch Shell
Financial
Times, 24 January 2006
No Solution In
Sight? |
NATURAL
LAW PARTY WESSEX
nlpwessex@btinternet.com
www.btinternet.com/~nlpwessex