Reaping What We've Sown - (untapped reservoirs of oil in our own country! Why no exploration?)

DALEY TIMES-POST ^ | May 1, 2005 | Edward L. Daley

[CHARLITE]

With gas prices higher than ever, and economists speculating that things are only going to get worse before they get better, it's not surprising that average Americans want to know why saying "fill 'er up" at the pumps these days may result in them being forced to sell a kidney on eBay in order to pay for it.

While several factors come into play, the current price of crude oil, which is now around $50 a barrel, accounts for roughly half of the total cost of gasoline to consumers. About a quarter of the price we pay can be attributed to state and federal taxes, and the remaining 25 percent is split fairly evenly between distribution and refining costs.

It's important to note that the latter 25 percent also includes oil company profits, however, in March of this year the American Petroleum Institute estimated that oil companies currently net approximately 7.2 cents per gallon sold. Since the average gallon of gas goes for $2.24 at the present time, that accounts for only 3.1 percent of the total price at the pumps.

Suffice it to say that those greedy, blood-sucking oil companies that liberals hate so much, aren't screwing us nearly as hard as Uncle Sam is, since he's taking over 8 times more cash out of our pockets than Exxon, every time we shove that nozzle into our gas tanks.

And although taxes really open up our monetary veins when we fill up our cars, nobody is inserting a bigger catheter into them than OPEC. Indeed, the Organization of Petroleum Exporting Countries is clearly putting the wood to us and most other industrialized nations on a regular basis.

First it cuts its oil output, and waits for demand to skyrocket. Then it increases production and sells as much "black gold" as possible... at a premium. Once the forces of supply and demand cause oil prices to drop below a certain, predetermined level, it then cuts its output once more, and the roller coaster ride begins anew.

That entity makes obscene amounts of money by manipulating the ebb and flow of worldwide oil prices, yet, even though OPEC has the ability to greatly influence the global market, its effects on the price of gasoline in this country wouldn't be nearly as profound, if we weren't so dependent upon foreign oil sources. Tell me, who's really to blame for that? Is it Saudi Arabia, Kuwait, Venezuela, or any other major oil producing nation?

No. After all, when did the United States last build an oil refinery, or construct a nuclear power plant, for that matter... a quarter century ago? Hell, we haven't stepped up domestic energy production one bit in all that time, and in fact we've shut down dozens of refineries in recent decades, yet our demand for energy keeps growing by leaps and bounds.

The U.S. Geological Survey (USGS) has assessed that the United States is sitting on as much as 112 billion barrels of recoverable oil. And even if they've overestimated the true amount by, say, 30 percent, we've still got enough oil to meet our energy needs for many years to come, yet the majority of these reserves continue to go untapped. The main reason for this is federal environmental laws, which have effectively made drilling off limits in much of the country (tens of millions of land acres), as well as in most areas off shore.

To put the amount of oil America may have at its disposal in perspective, let's compare our potential reserves to those of Saudi Arabia. The Saudis have approximately 262 billion barrels in their reserves, which is only about 150 percent more than the USGS suggests we have, and they are the number one exporter of oil in the world. We, on the other hand, are the top importer of oil, consuming 3 times as much as we produce every day.

In addition to an inadequate energy infrastructure, state and federal regulations effecting gasoline refinement, which, once again, have been created primarily because of environmental concerns, further limit our production capacity. For instance, as I write this article our existing refineries are forced to produce upwards of 50 different types of gasoline... 50 DIFFERENT TYPES! This seriously hinders their efficiency, and restricts availability in various local markets throughout the country.

Keep in mind that no one is suggesting certain reasonable measures shouldn't be taken to protect our environment from the potential ravages of industry. Clearly that's the responsible thing to do, however, we've taken the whole idea of it to preposterous levels in recent years, and the situation just keeps getting more absurd as time goes on. Think about it... whenever anyone of the conservative political persuasion even suggests doing something productive, like drilling for oil in ANWR and other domestic locations, which are not at high risk of suffering any real harm due to such undertakings, every liberal from Malibu to Manhattan acts as if he wants to poison their children.

Frankly, that's just plain nuts!

The trouble with this country isn't that we don't have the technology or the resources to free ourselves from the grip of foreign oil dependency. We do. Our problem is that, for the past 25 years or more, we've let a bunch of whinny, let's-all-hold-hands-and-sing-kumbyah environmentalists undermine our viability. We've allowed these tree-hugging peons to set us back economically, because we haven't had the guts to confront them and their representatives in public office, head on, and expose their political correctness for the dangerous lunacy that it is.

What was once the land of independence has become a land of increasing dependency, and no turban-wearing opportunist from another country is responsible for that. It's U.S. citizens who keep voting into positions of governmental authority, overly protective mother figures, who's only solution to our energy problems is to suggest that we all drive Yugos from now on.

So the next time you're at the pumps, getting agitated over the prospect of breaking another 50 dollar bill, ask yourself who's chiefly to blame for the outrageous gas prices you're paying. If your answer is greedy Haliburton executives, the taxman, or evil foreign oil merchants, you might want to avoid inhaling so many gas fumes in the future. While it's true that none of those folks are doing you any favors, the most ominous threat to your wallet is a bunch of homegrown, radical environmentalists, who would rather save some endangered species of dung beetle than the United States of America.

http://www.usgs.gov
http://api-ec.api.org/frontpage.cfm
http://www.eia.doe.gov/emeu/cabs/saudi.html

Edward L. Daley is the owner of the Daley Times-Post http://www.times-post.com

[kms61]

That's only one hurdle. Another is that the process takes a lot of water, and oil shale is found in a very arid region of the country. Bottom line, extracting oil from shale isn't a practial alternative right now. Not to say it won't be in the future, but there are still obstacles to overcome.

There's someone on FR who worked on the original shale pilot project in the seventies, and has covered this in some detail on other threads.

[B4Ranch]

ChevronTexaco 1st-Qtr Profit Rises as Prices Climb (Update1)
April 29 (Bloomberg) -- ChevronTexaco Corp., the second- biggest U.S. oil company, said first-quarter profit rose 4.5 percent as energy and chemicals prices surged.

First-quarter profit from oil and gas rose 21 percent to $2.38 billion as increased prices more than made up for declining output.
http://www.bloomberg.com/apps/news?pid=10000103&sid=adK8FlHWiENk&refer=us
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Oil Industry Boom Likely to Continue

SAN FRANCISCO, Apr. 29, 2005

(AP) Pumped up by persistently high energy prices, the oil industry maintained its streak of massive _ and growing _ quarterly profits this week, aggravating motorists and amazing financial analysts.

"I have been following this industry for 18 years and I have never seen anything like this," Oppenheimer & Co. analyst Fadel Gheit said Friday. "It's like they're printing money."
http://66.102.7.104/search?q=cache:Dz-Bve5r1gQJ:www.cbsnews.com/stories/2005/04/29/ap/business/mainD89PB4G80.shtml+1st+quarter+oil+industry+profits&hl=en
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April 28, 2005, 9:11PM

Exxon Mobil notches huge profit for quarter
Figure is fifth-largest for U.S. companies
By DAVID KOENIG
Associated Press

DALLAS - Exxon Mobil Corp., the world's largest publicly traded energy company, reported that its first-quarter profit surged 44 percent as high prices for oil and natural gas more than offset declining production.

Exxon Mobil's profit was the company's biggest ever in a first quarter. It also was the fifth-largest for any U.S. company in any quarter.
http://www.chron.com/cs/CDA/printstory.mpl/business/3159349
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Last Updated: Tuesday, 26 April, 2005, 15:59 GMT 16:59 UK
Rising oil prices boost BP profit

"Significant investment" has also helped profits, BP says
Increased world oil prices have helped boost BP's profits over the past three months, the firm has said.
BP said replacement cost net profit for the first three months of the year was $5.49bn (£2.87bn), up 29% on the same period a year ago.

Excluding non-operating items such as gains from asset sales, of $535m, the "industry-standard" result was $4.96bn.

BP chief executive Lord Browne said "higher oil prices have generated substantial additional cash flow".

http://66.102.7.104/search?q=cache:0kWnaHwm9psJ:news.bbc.co.uk/go/click/rss/1.0/-/1/hi/business/4484345.stm+1st+quarter+oil+industry+profits&hl=en
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Driven to frustration
ARTEMIS COUGHLAN, Staff Writer04/29/2005

TRENTON -- While some oil companies reported swelling profits last quarter despite a drop in production, area motorists are watching as their pocketbooks and wallets get thinner and thinner after they leave the gas pumps.


Exxon Mobil Corp., the world’s largest publicly traded energy company, reported that first quarter profits surged 44 percent.
http://www.zwire.com/site/news.cfm?newsid=14439577&BRD=1697&PAG=461&dept_id=44551&rfi=6
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Exxon Mobil Sees Profit on Oil, Gas Prices Thu Apr 28, 2:26 PM ET



IRVING, Texas - Exxon Mobil Corp., the world's largest publicly traded oil company, said Thursday that first-quarter earnings soared 44 percent from last year, due mainly to strong crude and natural gas prices. The company said it will boost its share repurchase rate by $1 billion in the second quarter.

Net income surged to $7.86 billion, or $1.22 per share, from $5.44 billion, or 83 cents per share, a year ago. Excluding a $460 million gain on the sale of Exxon's stake in China Petroleum and Chemical, the company earned $1.15 per share in the latest quarter.

Total revenue climbed to $82.05 billion from $67.60 billion last year.

Analysts surveyed by Thomson Financial were looking for the company to post higher operating earnings of $1.20 per share in the latest quarter.
http://story.news.yahoo.com/s/ap/20050428/ap_on_bi_ge/earns_exxon_mobil;_ylt=Au61aPiT77qEEIZVsSkrYi.yBhIF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl
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Is a comment necessary?

[lodwick]

Lindsey Williams bump.

[Calpernia]

BUMP!!!!!!!!

[Calpernia]

Arctic Coastal Zone Management - 1978

This project was approved by the U.S. Army Corps of Engineers on February 27, 1978. Stipulations for the permit call for removal of the island when the island is abandoned. Regulatory stipulations for operations and management of the island are under supervision of the State Oil and Gas Con. servation Committee of the Dept. of Natural Resources. When Sohio-BP dismantled its operations on its Sag No.1 gravel island, after having plugged its two exploratory wells, the State ruled that because the island had become an important nesting ground, the island was not to be removed.

EXXON NO.1 DUCK ISLAND UNIT, Authorized in Jan., 1977, the near shore gravel island was built on an existing lease this summer, and drilling was begun. The proposed BP gravel island would appear similar.

Exxon's Experimental Ice Island

On September 20th, the U.S. Corps of Engineers issued public notice of its receipt of a permit application for the construction of a 1200-foot diameter ice island approximately 6 miles north of the ARCO East Dock and about 3 miles northeast of Gull Island in Prudhoe Bay (where ARCO has also drilled and plugged at least two exploratory wells. The findings of all the above-mentioned explorations will be kept confidential until after the joint Federal/State Beaufort Lease Sales.)

Union Oil's East Harrison Bay Ice Island near Thetis Island was the first man-made offshore structure in the U.S. Beaufort Sea. The well was plugged and the island melted in 1977. Union has not revealed the results of the exploration. The proposed EXXON experimental ice island would be larger, designed to survive annual breakup.

The purpose of this ice island will be to determine if a permanent ice island can be built to permit 12-month operation in water up to 10 feet deep. In 1976, Union Oil was successful in constructing the first ice island in the Arctic in 9 feet of water off Thetis Island in East Harrison Bay. This island was only large enough to sustain a winter-only exploratory operation. EXXON's new ice island experiment would try to demonstrate the year-round potential of larger man-made ice islands and thus ease the offshore need for gravel, a scarce and expensive item in the Arctic. No drilling would occur on this island, scheduled for construction beginning November of this year.

The structural properties of ice have long been known to be suitable for construction purposes. The construction of an ice island consists in pumping sea water from below the ice onto the pad site, flooding the area to a depth of a few inches, and waiting for the water to freeze. The process is repeated several times. As the weight of the man-made ice increases, the natural ice stretches down until it is firmly anchored on the sea-bottom.

Next, a huge bottom-anchored ring of ice and snow is built around the pad to receive the brunt of the lateral thrust of the ice.

Then a moat is excavated part way around the island to protect against any ice movement threatening the ring.

Finally, snow fenses are constructed around the island to prevent blowing snow from covering the drill site.

Union's Harrison Bay ice island was built up to a height of 12 feet above the sea floor, 3 feet above the water.

The outside diameter of the protective ring was 1,000 feet. The width of the moat was 11 ft.

Sohio-BP Gravel Island

The Army Corps of Engineers received the application for the Sohio-BP gravel island operation in 10 ft of water 1-mile north of the Niakuk Islands. This project would begin in November with the removal of shore-fast ice and replacement with gravel. Rig-up would occur in January for stratigraphic core testing with a chance that oil or gas could be discovered in the process.

Sohio-11P has joined with the villages of Nuiqsut and Kaktovik in asking the Corps of Engineers to hold public hearings on this project. and the Corps has agreed. In the meantime, Sohio-BP has begun flying village leaders from the two villages to view the actual site before freezeup.

Reindeer Island Stratigraphic Test

HP spokesperson Tim Bradner has acknowledged BP's desire to take over the proposed Reindeer Island stratigraphic test program for which state permit has been made by a small earth science consulting firm. HP would lead a consortium of 15 companies interested in drilling a stratigraphic test on an off-structural location where chances of hitting oil are nil.

The island is within the proposed joint Federal/State lease sale, and the test would yield geological data to be used to plan how to bid in the sale, planned for late 1979. BP's consortium is asking the state to agree to keep its test results secret until after the sale is held, even if the sale is delayed.

Artificial fill islands, constructed from sand, gravel, and silt, must be made strong enough to withstand tremendous lateral pressures caused by ice movements against the islands.

In construction of a typical island, a berm of 2 cu. ft. sandbags is built up to water level to retail the fill material. Then the fill is dumped in. After the island is built up to the deisred height above water level, the slopes are protected with a layer of poly-filter cloth overlain with large 2 cu. yard sandbags. This provides the island armor against which the ice fails as it rides up the slope.

Oil companies have drilled exploratory wells from 16 artificial fill islands in Mackenzie Bay area. A typical island costs $2.5 million to construct, requiring 48,000 cubic yards of fill material plus 50,000 2 cu. ft. sandbags and 8600 2 cu. yd. bags. Construction can often be accomplished in 30 days.

Exxon Announces Results of Seconds Pt. Thomson Well

ANCHORAGE-Exxon USA announced today that the Pt. Thomson Unit No.2 well on Alaska's North Slope has been completed after reaching a total depth of 14,117 feet.

A test of the interval from 11,580 to 11,678 feet flowed 21 degree API gravity oil at a rate of 248 barrels per day with a gas/oil ratio of 500 cubic feet per barrel, according to Rod L. Boane, manager of Exxon's Alaska Exploration District.

This well is located four miles west-southwest of the Pt. Thomson Unit No.1 well on a farm-in from a group of companies including Phillips, Mobil, Pennzoil, Al-Aquitaine, Star Oil & Gas, Coastal States Gas, Gas Producing Enterprises, Forest Oil, Grace Petroleum, Newmont Oil, Sunlite International, and Trans- World Oil & Gas Limited.

Greenies, NSB Team Up

Culminating a 3-year effort by Mayor Eben Hopson to join formally with environmental groups to plan the environmental defense of the Arctic, the North Slope Borough has agreed to join in a comprehensive program of legal research with Alaska's only public interest environmental law firm, Trustees for Alaska, in a Beaufort Sea Project. The research will include the review of the draft environmental impact statement for the joint Federal/ State Beaufort Sea lease sale scheduled for December, 1979, and the review of the proposed Pt. Thomson lease sale stipulations developed this past summer by the Alaska Agency Advisory Committee on Leasing. This work will be followed with the design of a legal regime for implementing the Borough's Arctic Coastal Zone Management program.

Heading up this project for Trustees will be Robert E. Mintz, 30, an attorney specializing in environmental law. Mintz is a 1975 graduate of Yale Law School, and in the same year graduated from Princeton's Woodrow Wilson School of Public and International Affairs with a Masters degree in Public Affairs (Economics & Public Policy). After graduation, Mintz clerked for Federal Circuit Judge Robert P. Anderson in Connecticut for a year before joining the staff of Trustees for Alaska. Mintz has handled Trustees' Beaufort Sea work since it began in early 1978.

Mintz will be joined on the project by Susanne Weller, 26, a recent graduate from the University of Michigan Law School, specializing in environmental law.

Trustees for Alaska is a non-profit Alaska corporation established in 1975 to serve as the legal arm of the environmental protection movement in Alaska, and has a membership of about one thousand from both within and outside of Alaska. The Executive Director, attorney Wilson A Rice, served with Alaska Legal Services, Inc. for five years before joining Trustees.

We have wells drilled. We have proven oil in those wells. Capping has been done and who now is the Trustee owner of our oil????

[Calpernia]

http://www.freerepublic.com/focus/news/1394968/posts?page=45#45

[Alamo-Girl]

Thanks for the ping!

[Eagles6]

Very interesting. Thanks.

[JimRed]

Building more refineries will be necessary as well.

[BIGLOOK]

$2.59.9/g Ping

And Goooood morning, Calpernia!

[gogipper]

But how much would a few cents off at the pump mean?

That was not a serious question.

A couple of pennies per gallon means arond 8 billion dollars staying in our economy, eight billion dollars not going to terrorism supporting middle eastern countries.

[durasell]

Yes,there is that. But consider also, alot of the middle east oil profits are funneled back into the u.s. by way of investments. The largest single stockholder of citicorp, I think, is Suadi.

[gogipper]

And the Saudi's are the largest financial backer of wahibism and the home of Osama Bin Ladin.

Why exactly are you against using our own oil responsibly?

[durasell]

I'm not against using our own oil. I just don't think it's THE solution. Actually, I don't think there is a single solution. I think there's a whole bunch of smaller pieces that make up the answer.

The problem -- which is oddly similar to much in the U.S. today -- is that if you are for using our own oil, then you're against hybrids. If you're for hybrids, then you're against using our own oil. Every component of a complex problem, such as oil, carries with it all these other assumed beliefs that put you on one side of the issue or the other.

I believe, as much as I believe in anything, that complex problems are rarely solved by simple solutions.

[gogipper]

This thread wasn't about simple solutions was it? It was about one constraint.

Did you hear Rush Limbaugh talking about this subject today?

[durasell]

No, didn't hear Rush. Don't listen to him mostly because I don't own a car and don't like talk radio. Also don't have cable TV, so I don't hear those guys, either.

If the thread is only about one constraint, then you and I have no argument.

[gogipper]

I posted it.

[raybbr]

-in a nutshell,, you end up with 50% more waste rock than you started with.

How is that possible? Is new rock created?

[kms61]

I should have been more clear. It's the same amount of rock, but it takes up 50% more volume.

[beaver fever]

That is some very nice research. Definitely a keeper. Good work!!