Energy Watchblog: Midstream

Ukraine Russia Gas Dispute Infographic

Kiev and Moscow have been locked in a bitter dispute over gas supplies that has prompted fears of a return to the winters of 2006 and 2009, when Russia temporarily halted gas deliveries to Ukraine and some European countries. Last week Ukraine said it was suspending the purchase of gas from Russia, and relying on supplies from its own storage facilities. But it backtracked on the announcement within days. Russia has said that Naftogaz, Ukraine’s state-owned oil and gas company, owes over $1 billion in unpaid gas bills. Ukraine maintains that Russia charges it more for gas than other European nations.<br /><br />Click the image below for larger version infographic<br /><br /><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj34ur8Z8pGkk6YXye20sRnOzqI86_R2EPmabsTqaMKHRT8tljsZ_8shPDZHiAABR-jClfzQ7nQ18f9UCicETBA2O3DeRycUxvFmfsznNsaC_bUHkWjNVm_ONly5vE31qjwjqaUrkppXe68/s1600/infographicUkraingasdispute.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="640" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj34ur8Z8pGkk6YXye20sRnOzqI86_R2EPmabsTqaMKHRT8tljsZ_8shPDZHiAABR-jClfzQ7nQ18f9UCicETBA2O3DeRycUxvFmfsznNsaC_bUHkWjNVm_ONly5vE31qjwjqaUrkppXe68/s640/infographicUkraingasdispute.jpg" width="349" /></a></div><br />

Ukraine Russia Gas Dispute Infographic

Kiev and Moscow have been locked in a bitter dispute over gas supplies that has prompted fears of a return to the winters of 2006 and 2009, ...

Elk finalises carbon dioxide agreement

<div class="widget slideshow default widget-editable viziwyg-section-822 inpage-widget-1317835 in_article_slideshow" style="border: 0px; color: #1a1a1a; font-family: Arial, sans-serif; font-size: 12px; line-height: 15px; margin: 0px 0px 15px; outline: 0px; padding: 0px; vertical-align: baseline;"><div id="widget1317835-picture1347470" style="border: 0px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"><div class="wrapper" style="border: 0px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline; width: 646px;"><div class="description" style="border: 0px; margin: 0px; opacity: 0; outline: 0px; padding: 0px; vertical-align: baseline; width: 646px;"><div class="description_content" style="border: 0px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"></div></div></div></div><div class="apple_overlay" id="widgetContent1317835-picture1347470-info" style="border: 0px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"><span style="color: #1b1b1b; font-size: 14px; font-weight: bold; line-height: 1.25em;"><br /></span></div><div class="apple_overlay" id="widgetContent1317835-picture1347470-info" style="border: 0px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiXG9DNa43FrXz8YCtW2CZIcpou0EC2Rfp3H2a9q4UoXkDfNvox0wFLtCZdQD3f8CVG3O-ajisTPUsH0pxDIxbXizYHXo55-FXMhZWpifSAqodEHEzE5Z5Yy2W8c8m1I5dhVa5pzBktDfqz/s1600/bridgport.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="173" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiXG9DNa43FrXz8YCtW2CZIcpou0EC2Rfp3H2a9q4UoXkDfNvox0wFLtCZdQD3f8CVG3O-ajisTPUsH0pxDIxbXizYHXo55-FXMhZWpifSAqodEHEzE5Z5Yy2W8c8m1I5dhVa5pzBktDfqz/s320/bridgport.jpg" width="320" /></a></div><span style="color: #1b1b1b; font-size: 14px; font-weight: bold; line-height: 1.25em;">Australia-listed Elk Petroleum has finalised and executed a binding agreement with Bridgeport Ethanol to purchase carbon dioxide from Bridgeport’s ethanol processing plant in Nebraska.</span><a class="close" href="http://www.blogger.com/blogger.g?blogID=7291563859932161422" style="border: 0px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"></a></div></div><div class="widget storyContent article widget-editable viziwyg-section-12 inpage-widget-1000056 " style="border: 0px; color: #1a1a1a; font-family: Arial, sans-serif; font-size: 12px; line-height: 15px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"><div class="body" style="border: 0px; color: #474747; margin: 0px; outline: 0px; padding: 0px 0px 15px; vertical-align: baseline;"><div style="border: 0px; margin-bottom: 15px; outline: 0px; padding: 0px; vertical-align: baseline;">The agreement was originally announced in late November but after completing due diligence, the deal has been finalised. Elk will use the carbon dioxide for its enhanced oil recovering project at the Singleton and adjoining oil fields, close to the Bridgeport plan.</div><div style="border: 0px; margin-bottom: 15px; outline: 0px; padding: 0px; vertical-align: baseline;">The plant produced more than 150,000 US tons of carbon dioxide per year or about 7 million cubic feet per day. It is almost pure carbon dioxide and requires little processing other than compression and dehydration. The agreement will last for 10 years with potential for extension. Elk will have three years to build compression and pipeline facilities before the purchase agreements starts.</div><div style="border: 0px; margin-bottom: 15px; outline: 0px; padding: 0px; vertical-align: baseline;">The company said access to these supplies was key to building a carbon dioxide-based enhanced oil recovery strategy in Nebraska and the wider area. The Singleton oil field is the largest in the area and will act as an anchor project. Development could take less than two years and first oil production could occur as early as 2016, according to Elk.<br /><br /></div></div></div>

Elk finalises carbon dioxide agreement

Australia-listed Elk Petroleum has finalised and executed a binding agreement with Bridgeport Ethanol to purchase carbon dioxide from Bridge...

Brazil's Wilson Sons in US$140mn emergency vessel deal

<div id="text_print" style="background-color: white; background-repeat: no-repeat no-repeat; border: none; color: #1e2228; font-family: Verdana, Geneva, sans-serif, Arial, Helvetica; font-size: 16px; line-height: 22.390625px; list-style-type: none; margin: 0px; padding: 0px;"><div style="background-repeat: no-repeat no-repeat; border: medium none; font-size: 22px; line-height: 25px; list-style-type: none; margin: 0px; padding: 5px 10px;"></div><div class="p1" style="background-repeat: no-repeat no-repeat; border: none; font-size: 1em; list-style-type: none; padding: 0px 0px 7px 12px;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj7MIaJphEQbJ54RzGnfldOBeMpvMBaVb3Sbizb1YlyLlbMchE7TupLGBOa9zvMHvtpACEh2DkFubHJIQYSAFtHD072jo_sxk1hdCD7OWCPn_OJ0idcyrsI-1TZtMUgwuE4BGtb3YgpFHaj/s1600/544f9ef4c1a3a17c5485baa3307b6929.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="219" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj7MIaJphEQbJ54RzGnfldOBeMpvMBaVb3Sbizb1YlyLlbMchE7TupLGBOa9zvMHvtpACEh2DkFubHJIQYSAFtHD072jo_sxk1hdCD7OWCPn_OJ0idcyrsI-1TZtMUgwuE4BGtb3YgpFHaj/s320/544f9ef4c1a3a17c5485baa3307b6929.jpg" width="320" /></a></div><span style="color: black;"><span style="font-family: Verdana,sans-serif;">Brazilian oil and gas logistics firm Wilson Sons will build four spill recovery vessels in a 333mn-real (US$140mn) deal with local emergency services provider Oceanpact.</span></span></div><div class="p1" style="background-repeat: no-repeat no-repeat; border: none; font-size: 1em; list-style-type: none; padding: 0px 0px 7px 12px;"><span style="color: black;"><span style="font-family: Verdana,sans-serif;">The units will be built at Wilson Sons' Guarujá shipyard in São Paulo state and are due for delivery by 2016, the Rio de Janeiro-based firm said in a statement.</span></span></div><div class="p1" style="background-repeat: no-repeat no-repeat; border: none; font-size: 1em; list-style-type: none; padding: 0px 0px 7px 12px;"><span style="color: black;"><span style="font-family: Verdana,sans-serif;">Each 67m vessel will have an oil storage capacity of 1,050m3.</span></span></div><div class="p1" style="background-repeat: no-repeat no-repeat; border: none; font-size: 1em; list-style-type: none; padding: 0px 0px 7px 12px;"><span style="color: black;"><span style="font-family: Verdana,sans-serif;">The deal takes Wilson Sons' vessel backlog to 20 units. They comprise of<span style="background-repeat: no-repeat no-repeat; border: none; font-size: 1em; line-height: 1.6em; list-style-type: none; margin: 0px 0px 10px; padding: 0px 0px 7px 12px;"> 12 tugboats, two platform supply ships, a remotely operated vehicle support vessel and an additional spill recovery unit.</span></span></span></div><div><span style="background-repeat: no-repeat no-repeat; border: none; color: #606a82; font-size: 1em; line-height: 1.6em; list-style-type: none; margin: 0px 0px 10px; padding: 0px 0px 7px 12px;"><br /></span></div></div>

Brazil's Wilson Sons in US$140mn emergency vessel deal

Brazilian oil and gas logistics firm Wilson Sons will build four spill recovery vessels in a 333mn-real (US$140mn) deal with local emergency...

I’m Waiting For the Crude – Crude Price Differentials at The Gulf Coast

<br /><div class="tabs"></div><div class="meta submitted"><span content="2013-12-15T20:00:00-06:00"></span>The  bases are loaded for another 2 MMb/d of pipeline capacity to bring  additional crude supplies to the Texas Gulf Coast by the end of 2014.  The majority of that payload will likely be light sweet crude from tight  oil formations, a.k.a., shale. As the flood of crude headed to Texas  passed through the Midwest over the past two years, prices at Cushing  and points north were heavily discounted versus coastal markets. Now the  discount action has moved to the Gulf Coast where light sweet crude  imports have been pushed out. Today we look at the impact of the  changing supply position on crude price differentials.</div><br />This is Part 1 of a two-part review of Gulf  Coast crude price differentials that extends a series on the topic that  we started back in November (2013). The first episode in the series  described 4 MMb/d of current and planned expansions to crude  transportation capacity into the Texas Gulf Coast region (see Handling The Texas Gulf Coast Crude Flood).  Our analysis showed that the new incoming light crude capacity will  exceed Texas Gulf Coast demand by somewhere north of 0.5 MMb/d by the  end of 2015. In episode two we described how some of these excess crude  supplies would move east on the reversed Ho-Ho pipeline (see Gulf Coast Crude West to East Flows). In episode three we looked at how shippers could divert supplies away from Texas Gulf Coast congestion (see Texas Gulf Coast Bypass Options).  Episode four looked at progress bringing TransCanada’s Keystone XL Gulf  Coast extension (a.k.a, Cushing Marketlink Pipeline (CMP)) online (see Keystone Marketlink Comes to Texas).  Episode five looked at the impact of the twin Seaway Pipeline from  Cushing to Freeport expected online during the second quarter of 2014  (see Impact of the Seaway Expansion). Now we’ll get into what happens to price differentials as new crude supplies come flooding into Texas in the next six months.<br /><br />Forecasting prices for tomorrow is like gambling – only fun if you  don’t mind losing money. And the odds of being right get worse the  further out the predictions go. So our intent here is to concentrate on  price differentials – the spread between key crude benchmarks rather  than getting into absolute price levels. We start with a review of what  has happened since 2012 and then offer some scenarios for how things  might turn out next year (2014). Buckle up.<br /><br /><b>Recap 2012</b><br />Figure 1 below shows average differentials for key benchmark light  sweet crude grades at the Gulf Coast during 2012. The prices are  averages for the year versus the West Texas Intermediate (WTI) NYMEX  benchmark price at Cushing - set to $0/Bbl.  Recall that during 2012  surging crude production in North Dakota and Canada exceeded demand in  the Midwest and supplies started backing up at Cushing, OK because there  was very little pipeline capacity from the Midwest to the Gulf Coast  (where 50 percent of US refining capacity resides). Because of this  logjam a stockpile of crude built up at Cushing and inland domestic  prices based on WTI were discounted heavily versus Gulf Coast supplies  priced against the international benchmark Brent crude (see The Seven Gates of Hell for WTI Traders).  Domestic light sweet crude grades sold at the Gulf Coast – represented  by Light Louisiana Sweet (LLS) in our diagram - traded at the higher  international levels. In 2012 both Brent and LLS averaged $18/Bbl above  the discounted WTI “stranded” at Cushing. The dotted yellow line on the  chart indicates the pipeline ‘capacity constraint’ boundary that split  Cushing and Gulf Coast pricing markets at that time.  You can think of  that yellow line as separating zones of domestic and international  pricing along the Gulf Coast region.<br /><br /><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg-gV1vtrH7ax6BACQlmkOV1RnF0WCAUHabBRJd1W6Op7M5QK0IQ_Wa8ZXktaqVlEO8wCPbrl52dcYjuuhNaqGjbg1Xq4VJ3ViIt03GI3ISWHjB7kJTUjlRAKcmb8t62hB2fQTE4jQ_aHzd/s1600/figure1_5.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="267" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg-gV1vtrH7ax6BACQlmkOV1RnF0WCAUHabBRJd1W6Op7M5QK0IQ_Wa8ZXktaqVlEO8wCPbrl52dcYjuuhNaqGjbg1Xq4VJ3ViIt03GI3ISWHjB7kJTUjlRAKcmb8t62hB2fQTE4jQ_aHzd/s400/figure1_5.png" width="400" /></a></div><br /></div><div style="text-align: center;">Figure 1 - Source: RBN Energy</div><div style="text-align: left;">Prices for WTI are set both at Cushing, OK  – the gateway to Midwest refineries – as well as at Midland, TX, closer  to the Permian Basin production region. During 2012, Midland prices for  WTI were discounted by an average of $4/Bbl to WTI at Cushing because  of capacity constraints on the pipelines between Midland and Cushing  (caused by surging crude production in the Permian Basin). Until new  pipelines opened up from the Permian direct to Houston in 2013, WTI had  to travel to market from Midland to Cushing - into an already  oversupplied Midwest market (see New Adventures of Good Ole Boy Permian). </div><div style="text-align: left;"><br /></div>Next we move to Figure 2 below – which shows average price  differentials to WTI during the past three months – between September 20  and December 10, 2013.<br /><br />But before we get to those numbers we need to fill in the gap in our  analysis covering the first 9 months of 2013 – since Figure 1 only  covered 2012. That nine-months was a transition period during which new  pipeline capacity opened up between Cushing and Houston (Seaway Phase 2  expansion) and between the Permian Basin in West Texas and Houston  (Longhorn Reversal). Crude-by-rail shipments also increased the flow of  light sweet Bakken crude from North Dakota to the Gulf Coast during this  period (hence the rail track shown on Figure 2). As a result more light  sweet crude by-passed the Cushing logjam and reached Gulf Coast  refineries - reducing the need for waterborne imports. The crude  stockpile in Cushing declined from its record high levels and Gulf Coast  crude stocks began to increase. The net effect was that the Brent  premium to WTI, which reached $23/Bbl in February 2013 evaporated to  less than $1/Bbl by July (see Strangers in the Night).  Between July and September 2013, Brent, WTI and LLS traded in a narrow  range of about $5/Bbl with Brent “in the middle” at a discount to LLS  and a $3/Bbl premium to WTI.<br /><br />Since the middle of September, however, Brent prices have taken off  on their own track, leaving LLS trading at a narrow $3/Bbl premium over  WTI that is roughly equivalent to the pipeline tariff between Cushing  and the Gulf Coast (see Goodbye Stranger).  And that situation has prevailed ever since – as depicted in Figure 2  below. Over this period the Gulf Coast has been oversupplied with light  sweet crude, leaving no need for imports – allowing Brent prices to  effectively disconnect from LLS and take their own path – reaching as  high as a $17/Bbl premium over WTI but averaging $10/Bbl over the  period. The yellow dotted capacity constraint line separating  international and domestic markets at the Gulf Coast moved offshore.  Behind that imaginary yellow line, LLS prices tracked more closely with  WTI and traded at a discount to Brent that averaged $7/Bbl. Prices for  WTI in Houston and LLS in Louisiana tracked closely together –  indicating that both markets were equally well supplied. The WTI prices  at Midland continued to trade at a discount to Cushing over this past  three month period because although new capacity opened up from the  Permian to Houston, surging production in West Texas continues  to overwhelm pipeline capacity.<br /><br /><div style="text-align: center;"><img alt="" class="image-large" src="http://www.rbnenergy.com/sites/default/files/styles/large/public/field/image/figure2_7.png?itok=UY0CQejf" /></div><div style="text-align: center;">Figure 2 - Source: RBN Energy </div><div style="text-align: center;"><br /></div><div style="text-align: left;">And one argument for next year is that  price differential relationships at the Gulf Coast will stay basically  the same as they have been for the past three months. A December 11 “This Week in Petroleum”  report from the Energy Information Administration (EIA) notes that its  short term forecast for US domestic crude production - 7.5 MMb/d in 2013  rising to 8.5 MMb/d in 2014 will place continued downward pressure on  crude oil prices such as WTI and LLS.  EIA expects the WTI discount to  Brent to average $12/Bbl during the fourth quarter of 2013 and $9/Bbl  during 2014. EIA also expect the price for LLS to continue to move in  step with the WTI price plus the pipeline tariff.</div>So we will use that scenario as our base case – holding steady. In  the next episode in this series we will revisit the pipeline events that  will impact the differentials in 2014 and examine alternatives to our  base case price scenario for 2014.<br />------------ <br /><br /><table class="views-table sticky-enabled cols-4 tableheader-processed sticky-table"><tbody><tr class="even"><td class="views-field views-field-name"><a class="username" href="http://www.rbnenergy.com/user/28" title="View user profile.">Sandy Fielden</a>          </td>                  <td class="views-field views-field-picture"><div class="user-picture"><a href="http://www.rbnenergy.com/user/28" title="View user profile."><img alt="Sandy Fielden's picture" height="150" src="http://www.rbnenergy.com/sites/default/files/styles/user_profile/public/pictures/picture-28-1331334672.jpg?itok=cCGRUjKw" title="Sandy Fielden's picture" width="125" /></a>  </div></td>                  <td class="views-field views-field-field-expertise">Energy market pricing and fundamental data, Data Integration  with ETRM, writer on Energy Markets, Consultant, Conference Speaker           </td></tr></tbody></table>

I’m Waiting For the Crude – Crude Price Differentials at The Gulf Coast

The bases are loaded for another 2 MMb/d of pipeline capacity to bring additional crude supplies to the Texas Gulf Coast by the end of 201...

GE to build technology hub in Oklahoma City - Oil & Gas Financial Journal

<div class="PromoBoxHeadLeft" style="background-color: white; border: 0px; color: #37302b; font-family: Arial, Helvetica, sans-serif; font-size: 12px; height: auto; margin: 0px; outline: 0px; padding: 0px;"><div class="PromoBoxHeadRight" style="background-color: transparent; border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; height: auto; margin: 0px; outline: 0px; padding: 0px;"><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><div class="separator" style="clear: both; text-align: left;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjCNhKT65Xxnb96bYAuM4H4Th7UBemYsWWdbIAkP7c4Ur2-p9f5QAGyrx507gHSMCw5S41ySs1T1pdYlemaarIbg62nCl3luPFECt8kGrLsEZB_fKqqqelaqYDpEb33E8zEmrE2d06hykbx/s1600/big-data2.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="145" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjCNhKT65Xxnb96bYAuM4H4Th7UBemYsWWdbIAkP7c4Ur2-p9f5QAGyrx507gHSMCw5S41ySs1T1pdYlemaarIbg62nCl3luPFECt8kGrLsEZB_fKqqqelaqYDpEb33E8zEmrE2d06hykbx/s320/big-data2.jpg" width="320" /></a></div><br /><div class="separator" style="clear: both; text-align: center;"><br /></div><h1 class="compTitle" itemprop="headline" style="background-color: transparent; border: 0px; color: black; font-size: 20px; font-style: inherit; height: auto; line-height: 25px; margin-bottom: 0px !important; margin-left: 0px; margin-right: 0px !important; margin-top: 0px !important; outline: 0px; padding: 5px 0px;">GE to build technology hub in Oklahoma City</h1></div></div><div class="compBody" style="background-color: white; border: 0px; color: #37302b; font-family: Arial, Helvetica, sans-serif; font-size: 12px; margin: 0px; outline: 0px; padding: 5px 0px;"><div class="articlepublicationdate" itemprop="datePublished" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;"><span class="articlepublicationdatecnt" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;">December 6, 2013</span></div><div class="articlebyline" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;"><span class="articlebylinecnt" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;">GE</span></div><div class="article-content-wrapper" itemprop="articleBody" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;"><div class="clicktoenlargeimage parbase image headerimage" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px 0px 20px; outline: 0px; overflow: hidden; padding: 0px;"><img alt="" class="cq-dd-image cq-image-placeholder" src="http://www.ogfj.com/etc/designs/default/0.gif" style="border: 0px; display: block; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;" title="" /></div><div id="ContentBody" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;"><div class="gigya-article-share-bar-right" id="gigya-article-share-bar" style="border: 0px; float: right; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;"><div class="sharebar gigyashare" style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px;"></div></div><div style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; outline: 0px; padding: 10px 0px;"><a adhocenable="false" href="http://www.ogfj.com/articles/2013/04/ge-accelerates-artificial-lift-business-with-lufkin-acquisition-.html" style="border: 0px; color: #1370ac; font-style: inherit; font-weight: inherit; margin: 0px; outline: 0px; padding: 0px; text-decoration: none;">GE</a> has selected downtown Oklahoma City, Oklahoma, for its first-ever global research center dedicated to oil and gas technology. </div><div style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; outline: 0px; padding: 10px 0px;">The center will focus on accelerating mid- to later-stage oil and gas technologies developed in GE’s global research labs, including production systems, well construction, water use optimization, carbon-dioxide solutions, and energy systems<b>.</b> </div><div style="border: 0px; font-family: inherit; font-style: inherit; font-weight: inherit; outline: 0px; padding: 10px 0px;">Construction on the 95,000-sq-ft (8,826-sq-m) facility will begin in the spring of 2014, with the building expected to be completed and operational in 2015.</div></div></div></div><br /><a href="http://www.ogfj.com/articles/2013/12/ge-to-build-technology-hub-in-oklahoma-city.html">GE to build technology hub in Oklahoma City - Oil & Gas Financial Journal</a>

GE to build technology hub in Oklahoma City - Oil & Gas Financial Journal

GE to build technology hub in Oklahoma City December 6, 2013 GE GE has selected downtown Oklahoma City, Oklahoma, for its first-ever global...

Bushy Eyebrows and Climate Change..

<div class="content clearfix" style="background-color: white; font-family: Arial, Helvetica, sans-serif; font-size: 13px; line-height: 20.15625px; margin: 0.5em 0px;"><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><strong>Keith Bailey </strong>states the first real sign of advancing age is when one's barber asks if you want the ears, nose and eyebrows trimmed.  The second may be when two friends suggest that because of your "experience in the industry" that you might like to do a periodic blog on their internet energy website. Well it was a truly <a href="http://en.wikipedia.org/wiki/Andy_Rooney" style="color: #005a8c; text-decoration: none;">Andy Rooney</a> moment for me to be asked to be part of this publication and, just as Andy obviously did, I continue to tell my barber to keep his hands off my eyebrows.<br /><br />Assuming this first attempt doesn't hit the cutting room floor, my goal is to periodically choose a subject that strikes my fancy and which doesn't, at least in my judgment, appear to be getting either enough or balanced attention in the media.  And occasionally, just like Andy, there are things I will just wonder about.<br />For example, one thing I’ve been thinking about is the weather this past year.  If you look at the numbers, 2013 is going to turn out to be one of the coldest years in the U.S. in the last 20 years. [Among other publications, The Standard-Examiner had an article on this a couple of weeks back.  <a href="http://www.standard.net/stories/2013/12/03/global-warming-2013-pace-be-coldest-20-years" style="color: #005a8c; text-decoration: none;">Click here</a> to see it.)  <br /><br />Let’s look at some of the numbers.  The blue line on the graph below shows how cold it has been relative to 20 year average temperatures.  What is particularly fascinating is that this cold weather comes just after 2012, which was one of the warmest years on record (red line on the graph).  These temperature differences may look small on the graph, but just a few degrees in average temperature makes a big difference in how it feels when you walk outside, and also the impact of the weather on our environment. [Source: <a href="http://www.ncdc.noaa.gov/cag/" style="color: #005a8c; text-decoration: none;">http://www.ncdc.noaa.gov/cag/</a>]<br /><br /><div style="text-align: center;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiNnmxU2eDqycALmFWPJ4MNgvyR0MeIl5O2Bnz7_MZx4CxdAK569PUj1UdLvLdR5E3mTB7yc_Ngu6zfzn8L0B3njfflwRuUTXOIHQM64JOyRZt9BFhaUTKuJ9mHQ2_ITujv5dlxH2TaYjEB/s1600/chart_20.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiNnmxU2eDqycALmFWPJ4MNgvyR0MeIl5O2Bnz7_MZx4CxdAK569PUj1UdLvLdR5E3mTB7yc_Ngu6zfzn8L0B3njfflwRuUTXOIHQM64JOyRZt9BFhaUTKuJ9mHQ2_ITujv5dlxH2TaYjEB/s1600/chart_20.png" /></a></div><div style="text-align: center;"><br /></div><div style="text-align: center;">Source: NOAA </div><div style="text-align: center;"><br /></div>This year’s colder weather has been responsible for a number of interesting developments.  One that I find particularly intriguing is that the arctic ice cap grew by 553,000 sq miles or 29% over the past year.  (See: <a href="http://www.dailymail.co.uk/news/article-2415191/And-global-COOLING-Return-Arctic-ice-cap-grows-29-year.html" style="color: #005a8c; text-decoration: none;">The Gazette: And now it is Global Cooling</a>).   Of course that’s what the ice cap does. It shrinks in warm years like 2012 and grows in cold years like 2013.  It doesn’t seem like that should be a big surprise.  But apparently it was for some forecasters who according to the Gazette article have been predicting the impending demise of the ice cap. Some ‘experts’ had the ice cap gone in 2013.  Oops.<br /><br /><a name="more"></a><br /><br />Of course, just because they were wrong doesn’t prove anything.  Except that it might be a bit of evidence that forecasting the weather – or the results of the weather is still far from an exact science.  But that doesn’t stop ‘experts’ from making predictions or assigning causality.  In fact, there are countless studies out there to support just about any opinion you might want to have about global warming.  <a href="http://en.wikipedia.org/wiki/Global_cooling" style="color: #005a8c; text-decoration: none;">Many years ago</a>, some scientist suggested that an earlier long term cooling trend was attenuated because we started using cleaner burning fuels.  Supposedly this reduced the cloud layer which in turn allowed more sun to reach the earth and you can figure out the rest.  Just this year, following the recent record flooding in Colorado, ‘experts’ said that the cooler weather is somehow a result of a long term trend of shrinking ice caps shifting the jet stream and pushing colder air south. (Source: <a href="http://www.npr.org/2013/09/25/225754902/wild-weather-tied-to-unusual-jet-stream-activity" style="color: #005a8c; text-decoration: none;">Wild Weather Tied to Jet Stream</a>) I just don’t buy that weather models can be that precise about the cause-and-effect of weather phenomena.<br /><br />Please don’t misunderstand my point.  While I have no doubt that human activity is one of the factors that affects our weather and that domestic temperatures in a single year do not disaffirm the decades long global warming trend, <strong>I am just much less convinced than some prognosticators that it is "settled science" that hydrocarbons are the determinative factor in any particular outcome.</strong>  And that goes both ways.  As I learn more about the complicated net effects of global warming, I keep coming up with more questions than answers.<br />What I do know, however, from my now 50 plus years in the hydrocarbon industry is that the United States’ abundance of reliable, affordable energy has been a primary driver of our economic success as a nation.  In past decades, our energy resources helped drive the development of our country. Now, with the newfound abundance of shale hydrocarbons, it has the potential to further expand our role as the leader of the global economy. <br />We have over 100 years of supply of both coal and natural gas and we are rapidly increasing our domestic oil production thus lessening our demand for imported oil.  Over my career, I have seen our home furnace go from coal, to oil, to natural gas as technology and distribution capability changed.  I firmly believe that if we continue to use these traditional hydrocarbon fuels our international competitive advantage will be maintained and I also believe that we have steadily reduced the environmental impact of our use of these fuels and would expect those technological improvements to continue.<br /><br />It just makes one wonder if those suggesting we abandon these fuels altogether are so certain of their view of climate science that they are willing to put our national economy at risk based on those convictions.<br /><br />Humorist and commentator Andy Rooney was a frequent contributor to 60 Minutes until his death in 2011.  As noted above, he had bushy eyebrows. </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-above"><br /></div></div>

Bushy Eyebrows and Climate Change..

Keith Bailey states the first real sign of advancing age is when one's barber asks if you want the ears, nose and eyebrows trimmed. The...

Pressure on the configuration of oil and gas markets

<div id="article-body" style="border-top-color: rgb(230, 230, 230); border-top-style: solid; border-width: 1px 0px 0px; clear: both; color: #333333; font-family: inherit; font-size: 15px; font-style: inherit; font-variant: inherit; line-height: 20px; margin: 0px; outline: 0px; overflow: hidden; padding: 10px 20px; vertical-align: baseline;"><div class="left" style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgJveD9C_5mLS5IR0w0IGK7iWayMUrH6oXZOxKa6wt6HOwZhRliiYeg8hdGIyVi-jx0v9AMs8ezrFy1ylkvZT74joDuSWg7oBj-_gQiXTuB2jpyMYmcVx-hGjzo3-MrbAvNMfJciYgVpvO8/s1600/0a4af9a.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="295" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgJveD9C_5mLS5IR0w0IGK7iWayMUrH6oXZOxKa6wt6HOwZhRliiYeg8hdGIyVi-jx0v9AMs8ezrFy1ylkvZT74joDuSWg7oBj-_gQiXTuB2jpyMYmcVx-hGjzo3-MrbAvNMfJciYgVpvO8/s400/0a4af9a.jpg" width="400" /></a></div><i style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">(the two chief negotiators, Jamshid Amouzegar for OPEC and Lord Strathalmond for the oil companies, shaking hands after signing the Tehran Agreement in February 1971. Courtesy BP Archive)</i><br /><i style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"><br /></i></div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><span class="underline" style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; text-decoration: underline; vertical-align: baseline;"><b style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">Pressure on the configuration of oil and gas markets</b></span></div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">One of the first questions raised by the shale “revolution” will be about the impact of rising shale oil (and gas) production on markets and prices. Let’s concentrate on oil. In a normal market, prices should fall and the only issue for an economist would be to calculate how fast and by how much. But the oil market is not exactly ‘normal’: It features a producer cartel with a long history of trying to manage prices and production. In oil markets, the question of the consequences of higher (shale) oil supplies seamlessly translates into the question of how OPEC is likely to react.</div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">There are good reasons to presume that OPEC members are willing and capable to react with production cuts to rising non-OPEC supplies.</div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Production cuts, in turn, lead to spare capacity. The build-up of spare capacity in OPEC countries required to neutralize the additional supplies (including biofuels and oil sand production) is substantial indeed: Taking our conservative production profile as a guide, spare capacity to accommodate the new supplies will have to exceed 6 million barrels per day (Mb/d) within this decade - the highest since the late 1980s, as shown on the right hand chart below;</div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><img alt="" class="center" src="http://m.c.lnkd.licdn.com/mpr/mpr/p/4/005/02c/37a/1fbec1c.jpg" style="border: 0px; display: block; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px auto 1em; max-width: 606px; outline: 0px; padding: 0px; text-align: center; vertical-align: baseline; width: auto;" /></div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">This will be no easy task for OPEC. The cohesion of the organisation is the key uncertainty, especially in the current decade. It will be a world in which Russia, the US and Saudi Arabia account for a third of global production. Of the three, only OPEC member Saudi Arabia is likely to incur the cost of maintaining large amounts of spare production capacity. And Saudi Arabia is situated between Iraq, an OPEC member with steadily rising output but without a quota agreement, and Iran, for which no one can predict how long the current sanctions will limit production.</div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">On the other hand, we are unlikely to witness the return of the very low oil prices last seen in the 1990 or 1980s (assuming OPEC stays put). Tight oil production is not only relatively expensive; with its high well density, it is also eminently scalable (different from the conventional supplies in Alaska or the North Sea added in the 1980s). Supplies will react if prices fall substantially.</div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">In the first instance, the advent of shale oil (and gas) is likely to put pressure on prices by stressing the configuration of markets as we know them. In the case of oil, OPEC is the lynch pin of these markets. In the case of gas, it is the oil indexation of gas prices.</div><div style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><br /></div></div><div class="module-box" id="author-header" style="-webkit-box-shadow: rgba(0, 0, 0, 0.247059) 0px 1px 2px; background-color: white; border: 0px; box-shadow: rgba(0, 0, 0, 0.247059) 0px 1px 2px; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 17.77777862548828px; margin: 0px 0px 12px; outline: 0px; overflow: visible; padding: 0px; vertical-align: baseline;"><div class="articles-header-bar" style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; position: relative; vertical-align: baseline;"><img alt="Christof Rühl" class="member-photo" height="80" src="http://m.c.lnkd.licdn.com/mpr/mpr/shrink_80_80/p/5/000/26f/17d/071a24f.jpg" style="border: none; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; left: 0px; line-height: inherit; margin: 0px 20px; outline: 0px; padding: 0px; position: absolute; top: -10px; vertical-align: baseline;" width="80" /><br /><div class="author-info" style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 10px 0px 10px 120px; vertical-align: baseline;"><h2 class="author-name" style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">Christof Rühl</h2><h3 class="author-headline" style="border: 0px; font-family: inherit; font-size: 13px; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 17px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">Chief Economist at BP</h3></div></div></div>

Pressure on the configuration of oil and gas markets

(the two chief negotiators, Jamshid Amouzegar for OPEC and Lord Strathalmond for the oil companies, shaking hands after signing the Tehran A...

The future of energy featuring Christof Rühl

<div class="no-download-summary" style="background-color: white; border: 0px; font-family: 'Helvetica Neue', HelveticaNeue, Helvetica, Arial, 'Lucida Grande', sans-serif; font-size: 10px; line-height: 18px; margin: 0px; padding: 0px; vertical-align: baseline;"><div class="nvc-page-title" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><h1 style="border: 0px; color: #007f00; font-family: Univers-lt-45, Arial, Helvetica, sans-serif; font-size: 3.4em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1em; margin: 35px 0px 20px; padding: 0px; vertical-align: baseline;">The future of energy</h1></div><div class="parsys article-header" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"></div></div><div class="par parsys" style="background-color: white; border: 0px; font-family: 'Helvetica Neue', HelveticaNeue, Helvetica, Arial, 'Lucida Grande', sans-serif; font-size: 10px; line-height: 18px; margin: 0px; padding: 0px; vertical-align: baseline;"><div class="nv-text section" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><h6 style="border: 0px; color: #006600; font-family: Univers-lt-45, Arial, Helvetica, sans-serif; font-size: 2.2em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1.25; margin: -6px 0px 24px; padding: 0px; vertical-align: baseline;">How much more energy will the world need in the future? Are there enough energy resources to meet growing demand? What role will different forms of energy play? And which countries will produce and consume the most energy? These are the kinds of questions BP's economics team sets out to answer in the company's annual Energy Outlook publication. Here, we review some of the highlights of the 2013 edition and ask BP's chief economist Christof Rühl for his thoughts.</h6></div><div class="nvc-large-image section nv-caption" style="-webkit-box-shadow: rgb(196, 196, 196) 0px 3px 8px; border: 0px; box-shadow: rgb(196, 196, 196) 0px 3px 8px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px 0px 30px; overflow: hidden; padding: 5px; position: relative; vertical-align: baseline; width: 684px;"><img alt="Global Energy use" src="http://www.bp.com/content/dam/bp/images/large-images/global_energy_use.jpg/_jcr_content/renditions/original" style="border: 0px; float: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; height: 327px; line-height: inherit; margin: 0px; padding: 0px; position: relative; vertical-align: baseline; width: 684px;" title="Global Energy use" /></div><div class="nv-text section" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><div style="border: 0px; color: #666666; font-family: Arial, Helvetica, sans-serif; font-size: 1.3em; font-style: inherit; font-variant: inherit; line-height: 1.25; margin-bottom: 25px; padding: 0px; vertical-align: baseline;">More people, more wealth, more energy demand - that has been the story of the world's civilisation over the past 250 years. And that is how BP's economists expect it to continue - at least for the next 20 years. Around 1820 the world population reached 1 billion. Since then, it has soared to more than 7 billion and it is set to exceed 8 billion by 2030. This demographic growth has been accompanied by even more spectacular economic growth. The world economy has almost doubled in size over the past 20 years and it's expected to double again over the next 20. Energy has been a contributing factor as the number of people living on less than $1 a day has halved since 2000, from approximately 2 billion to around 1 billion, achieving the first of the Millennium Goals set by world leaders in 2000. </div><div style="border: 0px; color: #666666; font-family: Arial, Helvetica, sans-serif; font-size: 1.3em; font-style: inherit; font-variant: inherit; line-height: 1.25; margin-bottom: 25px; padding: 0px; vertical-align: baseline;">Note: the following text refers to OECD [Organization for Economic Co-operation and Development] and non-OECD. OECD brings together countries such as those of Europe, North America and Australasia, which have generally had industrial economies for a century or more. Non-OECD stands for developing or emerging market economies. Growth rates quoted in text refer to the period 2011-2030.</div><h3 style="border: 0px; color: #009900; font-family: Univers-lt-55, Arial, Helvetica, sans-serif; font-size: 2em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1.25; margin: -3px 0px 12px; padding: 0px; vertical-align: baseline;">Demand - who is using the energy? </h3></div><div class="nvc-freesizeimage section" style="border: 0px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px 0px 30px; padding: 0px; vertical-align: baseline;"></div><div class="nvc-texthighlight section" style="-webkit-box-shadow: rgb(196, 196, 196) 0px 2px 8px; background-color: #ffffe5; border: 5px solid rgb(255, 255, 255); box-shadow: rgb(196, 196, 196) 0px 2px 8px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; height: auto; line-height: inherit; margin: 0px 0px 30px; overflow: hidden; padding: 15px; vertical-align: baseline; width: 654px;"><div class="nvc-highlighted-text" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><h3 style="border: 0px; color: #666666; font-family: Univers-lt-45, Arial, Helvetica, sans-serif; font-size: 2em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1.25; margin: 0px 0px 9px; padding: 0px; vertical-align: baseline;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhGEsb7dO5B2-9B-SYWboDcZPVQtJoit1mhF1w1wMkLoFSoSh7yMsuQht8XAsU8EbJZqzIJoIZaTiMznko37gYdptjiWTb16P4FNofd6x92ehUutjBrzSkAXI3VB1g3NDktUDxKzpxDwxAr/s1600/demand_who_is_using_energy.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhGEsb7dO5B2-9B-SYWboDcZPVQtJoit1mhF1w1wMkLoFSoSh7yMsuQht8XAsU8EbJZqzIJoIZaTiMznko37gYdptjiWTb16P4FNofd6x92ehUutjBrzSkAXI3VB1g3NDktUDxKzpxDwxAr/s1600/demand_who_is_using_energy.jpg" /></a></div>Christof Rühl says</h3><div style="border: 0px; color: #666666; font-family: Arial, Helvetica, sans-serif; font-size: 1.3em; font-style: inherit; font-variant: inherit; line-height: 20px; padding: 0px; vertical-align: baseline; word-wrap: break-word;">"This projection is what we think is most likely to happen, not necessarily what we would most like to happen. It is based on current and anticipated trends in energy supply and demand, as well as what we see as the most likely path of policy and technological development. Things may not turn out this way if unexpected developments or game-changing technologies come along. As economies develop, their energy intensity falls - that is the amount of energy you need to generate every unit of income. For example, in the OECD countries, where ownership of energy-using appliances is already high, vehicles continue to cover more miles for every litre of fuel, homes will still become better insulated and industrial processes continue to become more energy efficient, often propelled by government regulations. Together with relatively slow population and economic growth, this explains why there already is so little growth in energy demand now coming from the industrialised countries. "</div></div></div><div class="nvc-freesizeimage section" style="border: 0px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px 0px 30px; padding: 0px; vertical-align: baseline;"><img alt="Consumption of primary energy by sector" src="http://www.bp.com/content/dam/bp/images/large-images/consumption_primary_energy.jpg" style="border: 0px; display: block; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;" title="Consumption of primary energy by sector" /></div><div class="nvc-texthighlight section" style="-webkit-box-shadow: rgb(196, 196, 196) 0px 2px 8px; background-color: #ffffe5; border: 5px solid rgb(255, 255, 255); box-shadow: rgb(196, 196, 196) 0px 2px 8px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; height: auto; line-height: inherit; margin: 0px 0px 30px; overflow: hidden; padding: 15px; vertical-align: baseline; width: 654px;"><div class="nvc-highlighted-text" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><h3 style="border: 0px; color: #666666; font-family: Univers-lt-45, Arial, Helvetica, sans-serif; font-size: 2em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1.25; margin: 0px 0px 9px; padding: 0px; vertical-align: baseline;">Christof Rühl says</h3><div style="border: 0px; color: #666666; font-family: Arial, Helvetica, sans-serif; font-size: 1.3em; font-style: inherit; font-variant: inherit; line-height: 20px; padding: 0px; vertical-align: baseline; word-wrap: break-word;">"Electricity is the biggest growth area, with power generation expected to account for almost 60% of the rise in energy consumption to 2030, followed by energy used in industry. This, first and foremost, shows the scale of energy needed in emerging economies as they continue to build their industrial sectors and cities. Transport accounts for much less growth around 10% with vehicles becoming more efficient. BP expects the efficiency of the internal combustion engine to double by 2030, largely driven by continued hybridisation of the car fleet."</div></div></div><div class="nvc-freesizeimage section" style="border: 0px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px 0px 30px; padding: 0px; vertical-align: baseline;"><img alt="Table of leaders in oil and gas reserves in 2011" src="http://www.bp.com/content/dam/bp/images/large-images/supply_reserves.jpg" style="border: 0px; display: block; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;" title="Table of leaders in oil and gas reserves in 2011" /></div><div class="nvc-freesizeimage section" style="border: 0px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px 0px 30px; padding: 0px; vertical-align: baseline;"><img alt="table_of_leaders" src="http://www.bp.com/content/dam/bp/images/other/table_of_leaders.jpg" style="border: 0px; display: block; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;" title="table_of_leaders" /></div><div class="nvc-texthighlight section" style="-webkit-box-shadow: rgb(196, 196, 196) 0px 2px 8px; background-color: #ffffe5; border: 5px solid rgb(255, 255, 255); box-shadow: rgb(196, 196, 196) 0px 2px 8px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; height: auto; line-height: inherit; margin: 0px 0px 30px; overflow: hidden; padding: 15px; vertical-align: baseline; width: 654px;"><div class="nvc-highlighted-text" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><h3 style="border: 0px; color: #666666; font-family: Univers-lt-45, Arial, Helvetica, sans-serif; font-size: 2em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1.25; margin: 0px 0px 9px; padding: 0px; vertical-align: baseline;">Christof Rühl says</h3><div style="border: 0px; color: #666666; font-family: Arial, Helvetica, sans-serif; font-size: 1.3em; font-style: inherit; font-variant: inherit; line-height: 20px; padding: 0px; vertical-align: baseline; word-wrap: break-word;">"Given the scale of demand, a perennial question has been whether the world has enough supply to meet it. The data collated by BP suggests it does - with the industry consistently finding more oil and gas than it produces over time. As a result, total reserves continue to go up, not down. In 1980, companies and governments collectively had proved reserves of just under 700 billion barrels of oil. Today, there are more than 1,600 billion, despite massive consumption over this period. "</div></div></div><div class="nvc-freesizeimage section" style="border: 0px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px 0px 30px; padding: 0px; vertical-align: baseline;"><img alt="Total energy production" src="http://www.bp.com/content/dam/bp/images/other/BP-Magazine/total_energy_production.jpg" style="border: 0px; display: block; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;" title="Total energy production" /></div><div class="nvc-texthighlight section" style="-webkit-box-shadow: rgb(196, 196, 196) 0px 2px 8px; background-color: #ffffe5; border: 5px solid rgb(255, 255, 255); box-shadow: rgb(196, 196, 196) 0px 2px 8px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; height: auto; line-height: inherit; margin: 0px 0px 30px; overflow: hidden; padding: 15px; vertical-align: baseline; width: 654px;"><div class="nvc-highlighted-text" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><h3 style="border: 0px; color: #666666; font-family: Univers-lt-45, Arial, Helvetica, sans-serif; font-size: 2em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1.25; margin: 0px 0px 9px; padding: 0px; vertical-align: baseline;">Total energy production - Christof Rühl says</h3><div style="border: 0px; color: #666666; font-family: Arial, Helvetica, sans-serif; font-size: 1.3em; font-style: inherit; font-variant: inherit; line-height: 20px; padding: 0px; vertical-align: baseline; word-wrap: break-word;">"Growth in production will be dominated by the non-OECD economies, which are likely to account for almost 80% of the increase in global production. We expect that non-OECD countries will supply 71% of global energy production in 2030, up from 58% in 1990. The dominance of the non-OECD group in growth of production is not as great as it is in consumption because several OECD countries, led by the US and others, continue to be significant producers."</div></div></div><div class="nvc-texthighlight section" style="-webkit-box-shadow: rgb(196, 196, 196) 0px 2px 8px; background-color: #ffffe5; border: 5px solid rgb(255, 255, 255); box-shadow: rgb(196, 196, 196) 0px 2px 8px; clear: left; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; height: auto; line-height: inherit; margin: 0px 0px 30px; overflow: hidden; padding: 15px; vertical-align: baseline; width: 654px;"><div class="nvc-highlighted-text" style="border: 0px; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><h3 style="border: 0px; color: #666666; font-family: Univers-lt-45, Arial, Helvetica, sans-serif; font-size: 2em; font-style: inherit; font-variant: inherit; font-weight: normal; line-height: 1.25; margin: 0px 0px 9px; padding: 0px; vertical-align: baseline;">Liquid fuel production - Christof Rühl says</h3><div style="border: 0px; color: #666666; font-family: Arial, Helvetica, sans-serif; font-size: 1.3em; font-style: inherit; font-variant: inherit; line-height: 20px; padding: 0px; vertical-align: baseline; word-wrap: break-word;">"One of the most dramatic developments in the global energy landscape recently has been the renaissance of oil production in North America, largely thanks to unlocking massive reserves of 'tight oil' or oil contained in shale formations (see page 23). We have also seen growth in biofuels in both the US and Brazil, as well as the emergence of Canadian heavy oil. These developments mean North and South America together are set to overtake the Middle East as the world's largest source of liquid fuels during the current decade and retain that position up to 2030 when we expect the Middle East to catch up again. The speed of these developments, especially in the US and Canada would have been unthinkable only a few years ago<a class=" nv-new-window-warning-icon" href="http://www.bp.com/content/dam/bp/pdf/bpmagazine/bp_magazine_2013_issue_2_4_link.pdf" style="background-color: transparent; background-image: url(http://www.bp.com/etc/designs/bp/images/furniture/bp-new-window-warning-icon.gif); background-position: 100% 2px; background-repeat: no-repeat no-repeat; border: 0px; color: #007f00; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px 20px 0px 0px; text-decoration: none; vertical-align: baseline;" target="_blank" title=""><span class="nv-new-window-warning-text" style="border: 0px; display: inline !important; font-family: inherit; font-size: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; height: 1px; line-height: inherit; margin: 0px; overflow: hidden; padding: 0px; position: absolute; top: -10px; vertical-align: baseline; width: 1px;">null</span></a></div></div></div></div>

The future of energy featuring Christof Rühl

The future of energy How much more energy will the world need in the future? Are there enough energy resources to meet growing demand? What ...

Geopolitics of energy - the big unknown

<div class="center" style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; text-align: center; vertical-align: baseline;"></div><br /><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh6vx6zCffdRuZyCPymIRN04MB1HgOhBSSjj9wfxu9aUr1BttORYFxy0zU0u5Tn8Ar0PoO0cbKZqpu3qQuEeDXfLHzLrPh7ORKjni8FkESOmlw4gUzVKMoETXjjImGZa_3msCG0_Z_RwA8u/s1600/2b9bcec.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh6vx6zCffdRuZyCPymIRN04MB1HgOhBSSjj9wfxu9aUr1BttORYFxy0zU0u5Tn8Ar0PoO0cbKZqpu3qQuEeDXfLHzLrPh7ORKjni8FkESOmlw4gUzVKMoETXjjImGZa_3msCG0_Z_RwA8u/s1600/2b9bcec.jpg" /></a></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><br /></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><span class="underline" style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; text-decoration: underline; vertical-align: baseline;"><strong style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">Geopolitics of energy - the big unknown</strong></span></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Having to make local decisions does not mean that the geopolitics of energy become less important. In fact, the third implication has been most widely recognized: It concerns the geopolitical consequences of shifts in the established centres of production and consumption. Nowhere is this better exemplified than by looking at the role of the Middle East.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">We all have grown up in a world in which oil is the central fuel, and the Middle East is the world’s central oil supplier. For better or worse, the ensuing relations between the world’s largest oil consumer and this regional supply centre always had huge political consequences: there is no denying that a special two-way relationship has developed over time between the US (and the OECD more broadly) and small Middle Eastern economies which happen to be large oil producers.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">These relations may be about to change, and in rather unpredictable ways.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Implausible as it may sound, twenty years ago, China was a net <em style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">exporter</em> of energy. By 2030 it is likely to become the world’s single largest oil (and natural gas, and coal) importer, relying on imports for almost 80% of its oil and more than 40% of its gas. Europe, over the same period, is likely to remain a large importer of fossil fuels - this is shown in the left hand chart below;</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><img alt="" class="center" src="http://m.c.lnkd.licdn.com/mpr/mpr/p/2/005/02d/19c/35739a6.jpg" style="border: 0px; display: block; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px auto 1em; max-width: 606px; outline: 0px; padding: 0px; text-align: center; vertical-align: baseline; width: auto;" /></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">The US faces different prospects. Taking again the conservative production profile as our guide, the country will be nearly self-sufficient in energy by 2030. North America as a region (Mexico, the US and Canada) is likely to achieve this landmark even earlier. The US is a net coal exporter already and there is little doubt that it will become a net natural gas exporter soon. And while, in our conservative profile, it will remain a net importer of oil by 2030, these imports will have fallen drastically.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">What are the consequences? Is it conceivable (and this is most definitely <span style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">not</span> a prediction) that a future American administration looks at this troubled region, wondering whether this is really skin of their nose because they need only very little oil – and the little they need, they can get from Canada and Mexico? We cannot know. The point is, it is unpredictable.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">What is clear is that nature, markets, and presumably politics are not known to be fond of a vacuum. We cannot know how this one will be filled. But the geopolitics of energy relations as we have known them, are shifting.</div><div style="background-color: white; border: 0px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><span style="color: #333333; font-family: Helvetica, Arial, sans-serif;"><span style="line-height: 20px;">-----------</span></span></div><a name="more"></a><br /><div style="background-color: white; border: 0px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><span style="color: #333333; font-family: Helvetica, Arial, sans-serif;"><span style="line-height: 20px;"><br /></span></span></div><div style="background-color: white; border: 0px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><span style="color: #333333; font-family: Helvetica, Arial, sans-serif;"><span style="line-height: 20px;"><br /></span></span></div><div style="background-color: white; border: 0px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><span style="color: #333333; font-family: Helvetica, Arial, sans-serif;"><span style="line-height: 20px;"><a href="http://www.linkedin.com/today/post/article/20131209164436-259060403-on-the-global-implications-of-shale-geopolitics-of-energy?trk=mp-reader-card" target="_blank">LINK</a></span></span></div><div style="background-color: white; border: 0px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><br /></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><br /></div>

Geopolitics of energy - the big unknown

Geopolitics of energy - the big unknown Having to make local decisions does not mean that the geopolitics of energy become less important. I...

On the Global Implications of Shale: Setting the Scene pt1

<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjYrdPnBpgurqS-hlBhS_h5t_xc5u8wo3MItRMQ6xLfO7Fz1a64CnzkSnz8Kp41RMCocP_B-WEeLomOtqpDYr3KHicvwJEY5jFnwJA5A0RxWWhvCBJosfTfNFjsUX3H5ZFtrbDKrMdagja-/s1600/215d08f.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="392" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjYrdPnBpgurqS-hlBhS_h5t_xc5u8wo3MItRMQ6xLfO7Fz1a64CnzkSnz8Kp41RMCocP_B-WEeLomOtqpDYr3KHicvwJEY5jFnwJA5A0RxWWhvCBJosfTfNFjsUX3H5ZFtrbDKrMdagja-/s640/215d08f.jpg" width="640" /></a></div><div class="left" style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><br /></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><strong style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"><span class="underline" style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; text-decoration: underline; vertical-align: baseline;">Setting the scene</span></strong></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">In a <a href="http://www.linkedin.com/today/post/article/20130730080645-259060403-oil-boom-2-0-an-american-dream-updated" style="border: 0px; color: #006699; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; text-decoration: none; vertical-align: baseline;" target="_blank">previous blog post</a>, I addressed some of the reasons for why the shale oil and gas “revolution” happened in the US and Canada, and not elsewhere, in countries with equally ample resources. The short explanation was - it is all about competition.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Innovation is involved in unlocking these resources, and so it will take time to bring them to market in countries that lock themselves out of the free flow of investment and ideas, or that do not allow for competition at home. The large scale commercial production of oil and natural gas from shale itself may be new, but there is nothing new about this principle in the history of our industry – or, if one thinks about it, the history of any industry.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Meanwhile, production in North America keeps rising. And shale is changing the broader landscape: No one doubts anymore that the country will become a natural gas exporter in the not-so-distant future. Total oil imports have been cut by almost half. With crude exports still legally constrained, the US now reaps the benefits of cheaper domestic crude by exporting refined products instead: The country has switched from net imports of 2 million barrels per day (Mb/d) of refined products as recently as 2007 to net exports of 1.2 Mb/d most recently. Not only is energy security benefitting: of all the countries in the world, the US last year had the biggest increase in oil as well as gas production – it also had by far the largest decline in CO2 emissions, courtesy of the unprecedented replacement of coal with natural gas in power generation, enabled by shale gas. (Natural gas fired power generation has about half the emissions of coal fired generation).</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Small wonder that the “shale revolution”, or unconventional oil and gas in North America more broadly, is slowly becoming recognized as consequential beyond this region, beyond energy markets, and for years to come. And yet, the assessment of global strategic implications – for energy security, geopolitics, the global economy, or for the environment - is still trailing actual developments; and perhaps unsurprisingly so, given the uncertainty around future production growth.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">What are some of these likely strategic, global implications? To discuss this, one needs a sensible benchmark.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"><em style="border: 0px; font-family: inherit; font-size: 15.555556297302246px; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;">What to expect?</em></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">There are two aspects that make shale resources different from conventional oil. First, they appear to be widely distributed across regions. Assessments are still in their infancy, but all available tallies show technically recoverable oil and gas shale resources spread across Asia, Australia, Africa, South America, Europe and Eurasia –closer to consumption centres than conventional oil. Mind you, we know preciously little about the economic recoverability of these resources.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Second, most forecasters - ourselves included - predict production growth to remain concentrated in North America for the foreseeable future, despite the relatively even spatial distribution. The reasons are the lack of access, competition and thus innovative fire-power in other countries; and, related, a lack of infrastructure, which will take time to build.</div><div class="center" style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; text-align: center; vertical-align: baseline;"><img alt="" class="left" src="http://m.c.lnkd.licdn.com/mpr/mpr/p/1/005/02c/26f/2d4a382.jpg" style="border: 0px; float: left; font-family: inherit; font-size: 15.555556297302246px; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px 1em 1em 0px; max-width: 606px; outline: 0px; padding: 0px; text-align: left; vertical-align: baseline; width: auto;" /></div><div class="left" style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;"></div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">The figure above illustrates both points. The left hand side shows a production profile, taken from BP’s Energy Outlook 2030, published in January this year. Based on our view of geology, infrastructure requirements, drilling activity as well as the speed with which shale resources are likely to be accessed in various locations, it shows global production from shale oil rising to about 9% of global oil production by 2030 - from virtually nothing just a few years ago.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Three characteristics are worth mentioning: (a) Production growth continues to be driven by North America; (b) growth will remain positive but slow down after about 2030 from the very high rates today; and (c), other countries will enter the game – notably Russia, China, Argentina and Columbia – but their contribution will not grow fast enough to reverse the general pattern of slower growth after 2020.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Next, we compared this freshly minted forecast to those of others, shown by the shaded areas on the right hand side of the figure above. It turns out (and at the time came as a surprise to us) that BP’s forecast is conservative indeed. It lies at the very low end of the range of all other forecasts. In fact, we had trouble finding lower estimates.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">Our forecast is not only lower; the slowdown of global tight oil growth after 2020 is also not widely shared. Many others predict steady growth, or even an acceleration out to 2030.</div><div style="background-color: white; border: 0px; color: #333333; font-family: Helvetica, Arial, sans-serif; font-size: 15.555556297302246px; line-height: 20px; margin-bottom: 1em; margin-top: 1em; outline: 0px; padding: 0px; vertical-align: baseline;">The conservative nature of this forecast matters. Obviously, given the current range of uncertainty, any discussion of global implications is - explicitly or not – based on a production outlook. Ours implies that the consequences discussed below have to be amplified, should the more optimistic predictions have it right.</div><div><br /></div>

On the Global Implications of Shale: Setting the Scene pt1

Setting the scene In a previous blog post , I addressed some of the reasons for why the shale oil and gas “revolution” happened in the US a...

“Might As Well Jump”—Will Alaska Jump-Start Gas Exports?

<h1 class="title" id="page-title" style="background-color: white; line-height: 1.2em; margin: 0px auto; padding: 0px;"><span style="line-height: 20.149999618530273px;"><span style="font-family: inherit; font-size: x-small; font-weight: normal;">Housley Carr (RBN Energy)</span></span></h1><h1 class="title" id="page-title" style="background-color: white; line-height: 1.2em; margin: 0px auto; padding: 0px;"><span style="font-weight: normal; line-height: 20.149999618530273px;"><span style="font-family: inherit; font-size: small;"><br /></span></span></h1><h1 class="title" id="page-title" style="background-color: white; line-height: 1.2em; margin: 0px auto; padding: 0px;"><span style="font-family: inherit; font-size: small; font-weight: normal;"><span style="line-height: 20.149999618530273px;">Alaska officials, concerned the state’s once-dominant role in U.S. energy production will continue slipping, are taking a fresh look at helping to jump-start a combined natural gas treatment plant, gas pipeline and LNG export project that would free vast volumes of natural gas now stranded at the state’s North Slope. A new study commissioned by the state found that it could make sense for Alaska to take a 20% or higher equity stake in the project, but that there are significant risks the state would need to mitigate. Today we look at whether the 49</span><sup style="line-height: 20.149999618530273px;">th</sup><span style="line-height: 20.149999618530273px;"> state can make a long-stalled plan by producers to move North Slope gas to market a reality by the mid-2020s.</span></span></h1><div class="content-middle" style="background-color: white; line-height: 20.149999618530273px;"><div class="region region-content"><div class="block block-system" id="block-system-main" style="margin: 0px;"><div class="content"><div about="/might-as-well-jump-will-alaska-jump-start-gas-exports" class="node node-article clearfix" id="node-714" style="border-bottom-color: rgb(187, 187, 187); border-bottom-style: solid; border-bottom-width: 1px; margin: 20px 0px; padding-bottom: 15px;" typeof="sioc:Item foaf:Document"><div class="content clearfix" style="margin: 0.5em 0px;"><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><div></div><div><span style="font-family: inherit;"><br /></span></div><div><span style="font-family: inherit;">Ask any American about Alaska and one of the first things that will come to mind is oil, and the oil pipeline that was built in the 1970s to move crude south from the North Slope’s Prudhoe Bay. “Alaskan natural gas” doesn’t roll off most tongues. But as we explored a few months ago in “’Some Plans Are Bigger than Others’—Alaska LNG Exports” the North Slope has some of the world’s biggest gas reserves. The Alaska Department of Natural Resources (ADNR) estimates there are 200 Tcf of unproven and 35 Tcf of proven conventional gas reserves onshore and offshore on the North Slope’s Prudhoe Bay and Point Thomson areas and in waters off the north coast of Alaska. Still, despite years of talk about possible gas pipelines, there is still no outlet—no way out--for all that gas. Instead, Prudhoe Bay producers continue to re-inject 8 Bcf/d of gas into oil wells.</span></div><div><span style="font-family: inherit;"><br /></span></div><div><span style="font-family: inherit;">Since the 1970s there has been hope of piping North Slope gas south to the Lower 48, but the last of those plans dried up by 2011-12 after the shale revolution led to the development of major new gas resources in the Barnett, Marcellus, Haynesville and other shale plays much closer to U.S. gas users. That shifted the discussion among Alaska energy giants like ExxonMobil, ConocoPhillips and BP—and TransCanada, which has been working with the state under the Alaska Gas line Inducement Act--to the idea of building about 800 miles of south-bound gas pipeline, a gas treatment plant, and an LNG export terminal in south-central Alaska (see Figure 1).</span></div><div><span style="font-family: inherit;"><br /></span></div><div style="text-align: center;"></div><div style="text-align: center;"><span style="font-family: inherit;">Figure 1</span></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEioHf3lrQTp5_vd860Y8TqaMbH14R3JPCMA27uJb1zA4pIkOxKDpF1ON12d_v2IhMHASE0vsyppcfL2D7hhwkNfNkS6oM54tvBCfaAJJfpOJskyfygznmpVc1WLnYrQrN_Ep3Z02X12Enae/s1600/Figure1_0.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><span style="color: black; font-family: inherit;"><img border="0" height="200" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEioHf3lrQTp5_vd860Y8TqaMbH14R3JPCMA27uJb1zA4pIkOxKDpF1ON12d_v2IhMHASE0vsyppcfL2D7hhwkNfNkS6oM54tvBCfaAJJfpOJskyfygznmpVc1WLnYrQrN_Ep3Z02X12Enae/s200/Figure1_0.png" width="190" /></span></a></div><div style="text-align: center;"><span style="font-family: inherit;"><br /></span></div><div style="text-align: center;"><span style="font-family: inherit;">Source: Alaska Gas Pipeline Project Office (<a href="http://gasline.alaska.gov/" style="text-decoration: none;">http://gasline.alaska.gov/</a>) </span><br /><span style="font-family: inherit;">Click to Enlarge</span></div><div><span style="font-family: inherit;">The primary market for the resulting LNG would be Asia, which buys about 70% of the LNG produced worldwide and whose LNG demand curve has been rising 8%/year the past five years. The catch is, the capital costs associated with all the required infrastructure are high—even by energy industry standards—and gas/LNG producers from Qatar, Australia, western Canada and the Lower 48 already are racing to reach long-term supply deals with Asia’s largest gas consumers. Time’s a-wasting, as they say, and in recent months there has been a new push to assemble the complex financial package needed to make Alaska’s gas export dreams finally happen.</span></div><div><span style="font-family: inherit;">Just last week (week of November 17), a top executive at ExxonMobil laid out the project’s challenges at the Alaska Resource Development Council Conference, and ADNR released a Black & Veatch study it commissioned on how the state might change its gas royalties or taxes—or even take an equity stake in the treat-pipe-and-export project—to help make the project a “go.” Two primary challenges the project faces, ExxonMobil said, are:</span></div><ul style="list-style-image: url(http://www.rbnenergy.com/sites/all/themes/rbntheme/images/menu-leaf.gif); margin: 0.5em 0px 1em; padding: 0px 0px 0px 1.5em;"><li style="margin: 0.15em 0px 0.15em 0.5em; padding-bottom: 0.1em;"><span style="font-family: inherit;">LNG projects with a capacity equivalent to more than 50 Bcf/d are being planned around the world, but less than 40 Bcf/d of additional LNG capacity is likely to be needed by 2030 to keep pace with expected LNG demand growth.</span></li><li style="margin: 0.15em 0px 0.15em 0.5em; padding-bottom: 0.1em;"><span style="font-family: inherit;">Big LNG customers prefer to enter into supply deals with LNG exporters whose terminals and other infrastructure can be built quickly, because that reduces the risk of entering into a long-term LNG supply deal based on too-high prices. The Alaska project would likely take five years or more to come online from the time of final investment decision (FID). The target FID for the Alaska project is 2017-18, with a commercial operation date of 2023-24, or several years behind the first group of LNG exports terminals planned for the U.S. Gulf Coast, West Coast and western Canada.</span></li></ul><div><span style="font-family: inherit;">Black & Veatch said in its study that the Prudhoe Bay and Thomson Point areas have the gas reserves to supply the project’s total needs, at least into the early 2040s, and by then those reserves could almost certainly be supplemented with new, “yet-to-find” fields nearby (see Figure 2). It also said the international LNG market is “illiquid” and “opaque,” with few participants and based primarily on long-term, 20-year-plus contracts. And, it said, the Alaska project would be costly: $10 billion for the gas treatment plant; $12 billion for a 42-inch diameter pipeline with eight compressor stations; and $23 billion for a three-train, 17.4 Mtpa liquefaction plant and export facility.</span></div><div style="text-align: center;"><a class="colorbox colorbox-insert-image init-colorbox-processed cboxElement" href="http://www.rbnenergy.com/sites/default/files/styles/extra_large/public/field/image/Figure2.png?itok=bW_16s1n" style="text-decoration: none;"><span style="color: black; font-family: inherit;"><img alt="" class="image-large" src="http://www.rbnenergy.com/sites/default/files/styles/large/public/field/image/Figure2.png?itok=eNcaQWrJ" style="border: 0px;" typeof="foaf:Image" /></span></a></div><div style="text-align: center;"><span style="font-family: inherit;">Figure 2</span></div><div style="text-align: center;"><span style="font-family: inherit;">Source: Black & Veatch/ADNR Study (PBU = Prudhoe Bay, YTF = Yet to Find - Click to Enlarge)</span></div><div><span style="font-family: inherit;">A real challenge, the Black and Veatch study said, is that with Alaska’s existing royalty and tax set-up, the $45 billion that producers would owe the State puts the project “out of the money” compared with other worldwide LNG projects under development that would provide sufficient volumes of LNG to meet 2025 demand. Some lower-cost projects may not get built, of course, for a variety of reasons. But even if the Alaska project inched toward being in the money, several other projects would be nipping at its heels, working to undercut it. The bottom line, Black & Veatch told the state, is that the Alaska project has the potential to compete for Asian business, but only if the state of Alaska adjusts its fiscal terms to improve the project’s economics. Like governments elsewhere, Alaska could reduce or even eliminate its royalties to help make the project work. But state officials are concerned that would undermine the Alaska Permanent Fund, whose support comes almost entirely from oil and gas royalties. The study concluded that instead of collecting existing taxes and royalties, a 20 to 30% equity investment in the project by the state could provide the same or better revenue.</span></div><div><span style="font-family: inherit;"><br /></span></div><div><span style="font-family: inherit;">One other thing is worth noting. The study found the state would better protect its interest by taking its royalties “in value”—that is, in cash—rather than taking them “in kind”—that is, by being paid by receiving a portion of the gas being piped south. If the state had to market LNG itself, the reasoning goes, it would need to enter into complex commercial agreements, and would be disadvantaged by its inexperience in LNG negotiation and its lack of an LNG supply portfolio to optimize. Producers, after all, are better than state governments at managing exposure to market risk.</span></div><div><span style="font-family: inherit;"><br /></span></div><div><span style="font-family: inherit;">A full-day hearing at the Alaska House of Representatives’ Natural Resources Committee last Friday (November 22) laid out the range of options the state should consider. What seems likely is that over the next few months, the Alaska DNR, state legislators, and the three North Slope gas producers will try to work out a series of interrelated tweaks to the state’s royalty and tax set-up that would help advance the project—with its treatment plant, pipeline and LNG export terminal--probably resulting in a direct investment in the project by the state. Whether that compromise will be enough remains to be seen. Because with significant amounts of new LNG capacity already under construction elsewhere in the world, and with several other LNG projects poised for construction starts in the U.S. and western Canada, Alaska may need to jump soon or find itself with a lot of still-stranded gas.</span></div></div></div></div></div></div></div></div></div></div>

“Might As Well Jump”—Will Alaska Jump-Start Gas Exports?

Housley Carr (RBN Energy) Alaska officials, concerned the state’s once-dominant role in U.S. energy production will continue slipping, are t...

Playing the Natural Gas Revolution with MLPs

<h2 style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 34px; line-height: 36px; margin: 20px 40px; text-rendering: optimizelegibility;"><span style="font-size: 16px; line-height: 21px;">Investors have different strategies and time horizons: While some are seeking stable dividend paying stocks, others enjoy the excitement of growth companies -- or perhaps something in between.</span></h2><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">If you fall in the latter category and are looking for a home-run hitter with a dependable batting average, <strong>Boardwalk Pipeline Partners</strong> (NYSE: BWP) could be a perfect fit. Here is a solid company that offers an outsized, stable distribution with the potential for stock appreciation as well. </div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">As the natural gas production boom continues, Boardwalk, with enough natural gas pipelines to span the United States more than 5 times, is primed to take advantage of transporting the fuel.</div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">In addition to owning natural gas pipelines in some of the top gas plays in North America, the company also controls underground storage caverns with approximately 201 billion cubic feet of working gas capacity and approximately 18 million barrels of liquids capacity.</div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;"></div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">The real win for investors is the fact that over 80% of revenues are backed by long-term, fixed-fee contracts with creditworthy customers. This "tollbooth" style of contract (where customers pay regardless of use) protects Boardwalk's cash flows, while sheltering the company from fluctuations in commodity prices.</div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">Which means investors can sleep soundly and count on receiving regular distributions every quarter. In fact, Boardwalk Pipeline Partners has consistently increased its dividend every year since its IPO.</div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;"><strong>Why buy into an MLP?</strong></div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">Boardwalk Pipeline Partners is a master limited partnership (MLP) which means the company avoids paying taxes on its profits like a corporation, and instead distributes profits to unitholders who are then taxed on an individual basis. By skipping double taxation, MLPs offer a tax-advantaged income stream and are thus able to lower the cost of capital.</div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">MLPs are strong investments, especially in low-interest-rate environments, due to the sturdy distribution yields they offer. However, expanding the business either organically or through acquisition is virtually the only way to increase yields. Having a lower cost of capital makes financing expansions possible without cutting distributions. With a suitable 5.5% cost of capital, Boardwalk has never decreased a quarterly distribution and most recently maintained a healthy distribution coverage ratio of 1.2 times.</div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">Boardwalk's high yield is also insulated by a fortress-like competitive moat since constructing new pipelines is incredibly capital intensive and requires regulatory approval contingent on demand. Equally important, natural gas storage is located in underground caverns and naturally occurring salt domes which limit storage capacity.</div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;"><strong>Industry tailwinds</strong></div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">Natural gas is a cleaner burning fuel than coal, emitting less than half as much carbon dioxide during combustion per unit of electricity output.  In addition, after natural gas prices reached record lows last spring, natural gas has been rapidly replacing coal-fired power generation. Since 2005, power generation from natural gas has increased more than 60%, supplying over 30% of all power generation in the United States in 2012.</div><div class="separator" style="clear: both; text-align: center;"><span style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px;"><br />In addition to power generation, natural gas usage could further benefit from LNG exportation. With an estimated 6.8 billion cubic feet per day of LNG exports expected in the next decade, Boardwalk, which controls 11% of the nation’s natural gas, stands to benefit. With natural gas expected to be the fastest growing fuel through 2040, investors interested in safe yields should benefit from Boardwalk gaining the upper hand when negotiating long-term, fixed-fee contracts. </span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgIjPTpJWUHfuAQII5VhKHXISawKmVm8lvrFy3_dKBGMhIm0xy6Htdstn3K7s_dBJ8E9g9hlACE9ZTXGd-JuN7AYZdubSSyvc_yiCdDVc6JqABslOB0wP20f3bo6PZNo7G_R5-c9zAJhS6c/s1600/us-electricitybyfuel-graph-sfr-3.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="169" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgIjPTpJWUHfuAQII5VhKHXISawKmVm8lvrFy3_dKBGMhIm0xy6Htdstn3K7s_dBJ8E9g9hlACE9ZTXGd-JuN7AYZdubSSyvc_yiCdDVc6JqABslOB0wP20f3bo6PZNo7G_R5-c9zAJhS6c/s320/us-electricitybyfuel-graph-sfr-3.png" width="320" /></a></div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;"><strong>bottom line</strong></div><div style="background-color: #fcfcfc; color: #333333; font-family: 'Open Sans', Arial, Helvetica, sans-serif; font-size: 16px; line-height: 21px; margin: 20px 40px;">A rare gem in the investing universe, Boardwalk Pipeline Partners offers quality natural gas assets at an incredible price. With the United States gearing up to be a net natural gas exporter, Boardwalk Pipeline Partners is prepared for growth through continued asset add-ons organically as well as through value-adding acquisitions. Also, in an unusually low interest rate environment, investors should be able to collect a steady stream from this 7% yielding natural gas juggernaut.</div>

Playing the Natural Gas Revolution with MLPs

Investors have different strategies and time horizons: While some are seeking stable dividend paying stocks, others enjoy the excitement of ...