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On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Gordana, the U.S. currently exports a small fraction of its ethanol production.  However, most of these exports go to Canada and not China.  And, yes ethanol production-distribution uses natural gas and petroleum, some of which comes from ‘shale gas’ and ‘tight oil’, but these facilities are not primarily reliant on these fossil fuel sources.

To correct your data, the Koch Industries is a relatively some owner of U.S. refineries and insignificant owner of U.S. pipelines.  The Koch Brothers support for the Keystone XL has to do with their Canadian investments primarily, and who knows, their concern also for U.S. energy security.

The Chinese may have relatively poor safety/environmental domestic standards than the U.S., but all facilities that operate within the U.S. must and do operate to and within U.S. regulatory standards.

And, to correct the data on U.S. ethanol consumption, the vast majority is consumed in most cars and light truck; primarily E-10 blended gasoline and limited E-85.  The only device required to safely operate on ethanol is installing rubber hoses and seals that are compatible (do not corrode/crack when exposed) with generally more corrosive blended ethanol fuels.  Buses and trucks most often operate on petroleum diesel, with very limited biodiesel; a totally non-ethanol biofuel. 

March 3, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Oliver, your honesty and ethics are to be admired.  By making some of the sacrifices you have made in your diet, more efficiently managing your house utilities and other more healthy and efficient living standards you have definitely helped make a difference.  I am a native Californian, born and raised in the East Bay, and a UC Davis Chem. E. graduate.  I spent a large part of my career modifying and improving the environmental and energy efficiency performance of two Bay Area Oil Refineries.  I and my coworkers designed, installed and operated these facility improvements in order to produce increasing cleaner fuels (per BAAQMD regulations) and do so with less energy (more efficiently) and significantly reduced environmental emissions (air & water).  Today, many California Refineries are the most efficient, cleanest (environmentally) and produce the cleanest fuels in the U.S. and the World.  The primary sacrifices that have been made by myself and coworkers, are that we typically worked 10+ hours per day and were often on-call 24-7 to ensure this clean/high efficiency Refinery performance was sustained.  And, most my Engineering friends also have heavily insulated their homes, installed high efficiency appliances, have Smarthome utility controls, and often drive high efficiency compact cars such as a Toyota HEV Prius.  What we all have in common is our goal to minimize our energy usage and costs, which also will benefit the environment in the short and long terms.

Keep up the good work Oliver.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Robert, over the years I have performed numerous analyses of how to most cost effectively reduce U.S. fossil fuels consumption and associated carbon emissions.  Nuclear is not only an option, but will absolutely be required to enable substantial expansion of renewable Wind & Solar PV power.  For example, refer to Table 4a of a past TEC article post.  As new vehicle battery technologies make EV’s more economic and attractive to average Consumers, Nuclear Power’s role in decarburizing the economy will further expand.  During the interim developing lower cost EV batteries (batteries must be far more economic than a current state-of-art Tesla 85 KWh batteries that cost at least $30K ea.), HEV’s that use batteries for limited ranges and then switch to petroleum fuels will continue to be the most popular option.  Your suggestion of making liquid syn-fuels as alternatives to petroleum will possibly be a significant solution to reducing carbon emissions.

As far as the U.S.’s leadership influencing the World to reduce their total carbon emissions in future years, my previous analysisdid not look too promising.  The issue begins with China, the world’s largest and growing source of carbon emissions.  Because of the probability of controlling and peaking world carbon emissions by mid-century is still very questionable and maybe not feasible, I tilt towards a more ‘balanced’ solution approach to reducing future U.S. carbon emissions.  A balanced solution would involve: 1) primarily reducing carbon from petroleum imports first, which will also improve energy security, 2) reducing carbon from coal power by installing nuclear, natural gas and renewables, but doing so without putting power grids reliabilities at significant risk, and 3) adaptation, which involves better preparing for possible climate change.  This approach may not be as narrowly carbon focused only as many environmentalist appear to advocate, but can be much more cost effective and sustainable.  By just narrowly focusing on much less effective carbon reduction approaches such as blocking the Keystone XL pipeline as a means to reduce U.S. petroleum consumption and curtail Canadian Oil Sands production, is highly unlikely to be significantly effective.  If the U.S. truly decides to block most or all Canadian oil imports, I’ll bet our friends in China are more than ready and willing to take our place as Canada's primary market for their oil exports.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Joe, agreed, if the White House does not support the Keystone XL project (as most of us believe) he should just ‘not approve’ the permit and stop with the chronic political delays.  It’s curious how President Obama, despite his apparent position of not supporting petroleum in the name of climate change, most often claims credit for the growth in U.S. oil production and most recently, low gasoline prices.  The real conflict of interests is the fact that after six years of the President’s energy and environmental policies total U.S. carbon emissions have increased by 200 million metric tons per year since 2012.  One could argue the level of increase could have been higher if it were not for his energy policies.  But, one could also argue the policies have failed to perform as claimed, particularly as the U.S. economy continues to recover from the 2007-09 great recession.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Robert, when it comes to the importance of substantially expanding Nuclear Power and advancing associated technologies you and I are 100% aligned.  When it comes to the probability of blocking the Keystone XL pipeline and having any significant impacts on either U.S. petroleum consumption or Oil Sands production we obviously disagree.  While Nuclear power will have no significant-direct impact on petroleum consumption in the near future, since this energy source only provides about 0.1% of current U.S. Electric Sector power generation, I am sure you understand very well its role could and will increased substantially as EV’s and electric heat pumps and/or radiant heaters expand in the future.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Stanislaus, FYI, I spent most my career in the oil business, retired from this business sector, and now consult, analyze and study all forms of energy, including renewables.  I have no connection or obligation with the oil industry and my personal motivation is to help people better understand what energy sources and technologies are reasonably cost effective and most feasibly sustainable.  And, I focus on what government policies will best support transitioning most Countries to cleaner, secure and cost effective energy supplies & technologies.

In the case of the Keystone XL pipeline, blocking this project will effectively have zero impact on U.S. petroleum consumption and will only slightly delay Canadian Oil Sands production-development.  And overall, blocking the pipeline will have essentially zero impact on the associated environmental impacts.  I understand that most the pipeline Opposition obviously believes differently.  However, this block-the-pipeline/oil position overlooks and/or misunderstands the consequences of this decision.  Besides overlooking the significant and beneficial energy security and economic impacts, the safety impacts of substantially increasing oil transportation by rail are currently missing from the pipeline Opposition’s campaign.  The added downside is that fact that rail is also much less efficient (with increased carbon emissions) than pipelines.

The ultimate solution is developing cost effective and clean alternatives to replacing petroleum.  Other policies such as mandating and encourage energy efficiency increases, alternative heating and motor fuels, etc. will be far more effective in reducing current and future demand for petroleum, and reducing the associated carbon/environmental impacts.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Oliver, you are probably correct that the Environmentalists’ opposition to the Keystone XL pipeline will not ever be persuaded to change their position, nor will the President ever approve the project permit.  But, the chronic delay in making any decision to not approve the pipeline is a bit difficult to rationalize as a trait one would expect of an effective Leader for any given Country.  The problem some folks have with this anti-Keystone XL Environmental movement/group is the fact that they are doing little or nothing positive in support of reducing the need for petroleum oil fossil fuels.  Isn’t it a bit hypocritical to drive, fly or be bused to these demonstrations in transportation vehicles that consume petroleum motor fuels?  Just kidding.  Anyway the solution to reducing the demand for petroleum consumption and associated environmental impacts is truly developing cost effective and sustainable alternative energy sources.  Is this ultimately feasible?  Yes, but the challenge is and will always be the cost and persuading or enabling most the populous in the world to adjust their lifestyles to truly lower petroleum consumption/carbon emissions standards.  

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Joe, I too wish that politicians, President Obama in this case, would stop with the political maneuvering and be honest.  In this case the President should ‘not approve’ the Keystone XL project and stop with the endless delays of not making any decision.  That way Businesses can stop wasting their time and money hoping an approval will occur within the next two years, and move on to other priority projects.

To build on my details and importance of the Trade relationship between Canada and the U.S., in 2014 total exports+imports were over $650 Billion in goods & services.  This included 3.3 million barrels per day of net oil imports,  1.9 trillion cu.ft. of net natural gas imports and about 50 billion KWh of net power imports from Canada.  Besides the importance of Canadian oil imports to U.S. Energy Security, several U.S. major power grids rely on Canadian power to balance supply-demand and overall grids’ stabilities.  The natural gas is base on existing infrastructures and optimal supply-demand balance economics that exist despite the growth in U.S. production in recent years.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Max, to restate the evidence, Canadian imports have increased by greater than the Keystone XL design 830 KBD capacity since 2008.  Re. the EIA evidence.  U.S. crude oil exports actually increased by 105 KBD, but guess where 104 KBD of these exports went?  Canada.  Yes, there is a market for U.S. Tight Oil in Canada.  Re. the EIA evidence.  Where did the 1.0 KBD balance of U.S. crude oil exports go?  China.  By the way, these exports were approved by the Obama Administration and come from condensate (minimally processed crude oil) made from U.S. Tight Oil production.   Despite the huge progress in U.S. domestic crude oil production, the U.S. still has net imports of about 5,100 KBD.  Re. the EIA evidence.  So, why would the U.S. export the safest and most economic source of crude oil imports from Canada?  From basic business market fundamentals and historic actual performance, it makes no sense a significant volume of Oil Sands crudes would be exported from the U.S.

The claim that all Keystone XL pipeline exports will be exported has no historic or current hard evidence.  It’s based purely on political rhetoric that totally ignores the facts and is based on the unreasonable belief that if we don’t build the pipeline Oil Sands production and U.S. petroleum consumption will somehow be constrained (despite the facts I referenced in this TEC posted article).

These are some of the many facts that invalidate the claims that the Keystone XL pipeline project will have no impact on U.S. Energy Security and the Economy, and significant carbon emission impacts.  But, I doubt these facts will persuade you and some others that the benefits are greater than the costs.  I respect your opinion on this subject, but I must agree-to-disagree.  Have a nice day, time to move on to the next project.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Max, to restate the evidence, Canadian imports have increased by greater than the Keystone XL design 830 KBD capacity since 2008.  Re. the EIA evidence.  U.S. crude oil exports actually increased by 105 KBD, but guess where 104 KBD of these exports went?  Canada.  Yes, there is a market for U.S. Tight Oil in Canada.  Re. the EIA evidence.  Where did the 1.0 KBD balance of U.S. crude oil exports go?  China.  By the way, these exports were approved by the Obama Administration and come from condensate (minimally processed crude oil) made from U.S. Tight Oil production.   Despite the huge progress in U.S. domestic crude oil production, the U.S. still has net imports of about 5,100 KBD.  Re. the EIA evidence.  So, why would the U.S. export the safest and most economic source of crude oil imports from Canada?  From basic business market fundamentals and historic actual performance, it makes no sense a significant volume of Oil Sands crudes would be exported from the U.S.

The claim that all Keystone XL pipeline exports will be exported has no historic or current hard evidence.  It’s based purely on political rhetoric that totally ignores the facts and is based on the unreasonable belief that if we don’t build the pipeline Oil Sands production and U.S. petroleum consumption will somehow be constrained (despite the facts I referenced in this TEC posted article).

These are some of the many facts that invalidate the claims that the Keystone XL pipeline project will have no impact on U.S. Energy Security and the Economy, and significant carbon emission impacts.  But, I doubt these facts will persuade you and some others that the benefits are greater than the costs.  I respect your opinion on this subject, but I must agree-to-disagree.  Have a nice day, time to move on to the next project.

February 26, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Clayton, interesting reference, thanks.  As far as the traditional in-situ extraction versus more impactful ex-situ extraction, what most do not apparently understand is that the use of the different extraction techniques is based on the reserves location/depth and associated project costs.  More shallow reserves are often extracted by ex-situ or open pit mining of the Oil Sands crude.  Deeper reserves are extracted using in-situ or drilling based technologies.

 

Generally the ex-situ technology is more expensive, not only to develop a new production project, but also to eventually cleanup, reclaim and reforestation of the site as required by Canadian regulations.  What most are not aware is that over half and growing of total Oil Sands production is developed using in-situ/drilling technology.  Those who oppose Oil Sands development (what they will normally call Tar Sands) usually include only illustrations or pictures of open pit ex-situ production sights, and totally omit or overlook the fact that most and growing Oil Sands production is produced with in-situ technology.  This pattern has increased significantly since oil prices have declined by 50%.  Only existing ex-situ projects will continue operate and new ex-situ projects have been cancelled or put on hold.  My understanding is that only new in-situ projects are planned to proceed in the near future; or until world oil prices directionally double again.

February 25, 2015    View Comment    

On Obama's Keystone Veto Message: "If You've Got a Business, You Can't Build That Infrastructure Project"

Clayton, I agree the current situation in China is different compared to Develop Countries’ histories.  The technology is definitely available and only wants for their Government to mandate its use.  However, nearly all Developing Countries normally take time to identify and implement available solutions to today’s pollution problems.  This action can be constrained by cost, available resources or a countries priorities; growth first, the environment second.  In the case of China, their local residents clearly are at largest health risks, but a going concern is the background or offshore pollution that is increasingly impacting the U.S. West Coast.

February 25, 2015    View Comment