Clean Diesel from Coal

Technology Review ^ | April 19, 2006 | By Kevin Bullis

[Roccus]

According to the Governors of WV and MT, the break-even point for coal gasification is $43/bbl.

[IrishMike]

I believe during the latter part of WWII, the german luftwaffe planes were flown with a fuel derived from coal.

[Roccus]

IIRC, Shell Oil is involved in a joint venture with PA and some other entities, building a gasification plant in PA right now.

[SampleMan]

You are correct. Also, kerosene always came from coal, but it wasn't broken down the way they are talking about now.

The trick is to protect their capital investment from falling oil prices. How? Sell vast quantities into the futures market. This is what they are doing with wind power generated electricity.

[cb]

Lots of energy sources in this price range, but require large investments. Few will take this risk when the arab cost of production is $4-5. (which means they can drop the price under your cost anytime they want) This difference is the reason that the arabs have played us on this global oil market since 1973. The only solution is to produce all of their oil and then get on to the alternatives.....which I think is what we are doing.

[.cnI redruM]

Long term contracts at a firm fixed price can redistribute the risk faced due to Arab, Mexican or Russian price arbitrage. Span the contract over about 7 years, and a potential arbitrager will suffer a great deal in the process.

[Rodney King]

The trick is to protect their capital investment from falling oil prices. How? Sell vast quantities into the futures market

The problem is that a futures market for an untested fuel production system doesn't exist. Nobody is going to take the other side of the counterparty risk.

[techcor]

bump

[ConsentofGoverned]

having sat behind a diesel bus, there is nothing clean about diesel

[aculeus]

having sat behind a diesel bus, there is nothing clean about diesel

Europe is miles ahead of us in clean diesels.

[Roccus]

Since you folk seem to be into the economics of oil, I've got a question. I read somewhere back during the crises of the 70's that the royalties that oil producing nations charge per bbl. are deducted, dollar for dollar from the tax bills of US oil companies. Is this true?

[Pessimist]

I think you got it just right.

Everything will take care of itself in the long run when the true cost of oil increases to the point that it makes various other alternatives feasible.

In the meantime though, we'll no doubt do everything we can to screw that up via politics.

[thackney]

Few will take this risk when the arab cost of production is $4-5. (which means they can drop the price under your cost anytime they want)

Arab countries do not have the ability to produce enough oil to meet the worlds oil demand.

[thackney]

No.

[Roccus]

T.Y.

[aculeus]

Since you folk seem to be into the economics of oil, I've got a question. I read somewhere back during the crises of the 70's that the royalties that oil producing nations charge per bbl. are deducted, dollar for dollar from the tax bills of US oil companies. Is this true?<

All foreign taxes paid by US corporations including oil companies are deducted as credits from US taxes payable, dollar for dollar. The "royalties" paid by US oil companies were (during my working years) considered taxes by IRS and were therefore deducted from US taxes payable.

[Malsua]

Back to Coal

Germany did it in WWII, we can do it now.

[Roccus]

PING! to #17

[Roccus]

It was my understanding that during the reign of the Sha, Kissinger suggested to him that he raise the royalties on oil in order to help Iran to pay for arms from the US. Kissinger's thought was that since these would be deductible by the oil companies, their relationship with the administration would not be hurt, the arms industries would get a boost, the Sha would get his arms and the only one to get hurt would be the US drivers.