Welcome to the ODAC Newsletter, a weekly roundup from the Oil Depletion Analysis Centre, the UK registered charity dedicated to raising awareness of peak oil.
BP has reported that its latest attempt to cap the leak at its Macondo well has stopped the flow of oil into the ocean. The news has so far been greeted with cautious optimism while integrity testing on the cap continues. The development comes at the end of another torrid week for BP both at the site—where the capping attempt was delayed more than once, firstly to add extra safety checks, and then due to a leak in the new cap—and in Washington where the company's future operations face further challenges.
In Congress this week the house committee on natural resources voted in favour of excluding companies with a poor safety record from new offshore drilling licenses. The proposal, which still needs to pass several phases before coming law, would apply to companies which had experienced 10 or more deaths in the past 7 years at drilling, production facilities, or refineries, and where US health and environment laws have been broken. BP would be affected both due to the Deepwater Horizon and the 2005 Texas refinery explosion.
In a separate move, a group of US senators this week called for an investigation into whether BP was involved in helping secure the controversial early release of Ali al-Megrahi, the Lockerbie bomber. BP quickly denied any role in the release, while confirming that it did press for a prisoner transfer agreement between the UK and Libya in 2007. The allegations will only further damage the reputation of the company in the US.
In addition to the environmental impact and the cost to the US Gulf economy, it is becoming increasingly apparent that the BP disaster is likely to have considerable fallout in the UK. As BP pays the costs of the oil spill in the coming years, the UK government stands to lose a chunk of the ВЈ900 million plus tax revenue it receives from the company just as the treasury has embarked on a massive programme of cuts to balance the budget. Also impacted are many UK pension funds which are heavily vested in BP making them vulnerable to the falling share price. In addition, some of the company's assets, such as the Forties Pipeline System in the North Sea are of significant strategic importance to the UK. In response the Department for Business and the Treasury is apparently drawing up contingency plans in the event of the failure of the company. BP meanwhile continues to state that it is sufficiently strong to survive. Q2 results will be released next week.
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OilBP Says Oil Flow Has Stopped as Cap Is TestedBP faces 7-year offshore drilling banObama renews ban on deepwater drillingBP admits 'lobbying UK over Libya prisoner transfer scheme but not Lockerbie bombEU commissioner repeats drill ban callCrude Oil Poised for Second Weekly Gain on Equity Gain, Dollar Nigeria denies state oil firm NNPC bankruptIEA forecasts slower oil demand growth in 2011Sudan oil row threatens peace ahead of referendumBP in talks with Apache over sale of giant oil field at Prudhoe Bay Brazil Starts New Libra Oil Well as Mechanical Problem Halts First AttemptKazakh duty ruling rewrites oil termsRenewablesSpain overtakes US with world's biggest solar power stationSweden leads the European Union on renewable energyStabilisers will let deep-sea wind turbines stand tallBiofuelsAlgae to take off as weapon in fight against fuel costUKBP's Crisis Could Soon Become Great Britain'sSpill costs to cut BP tax bill by $10bnBusiness warns on need for investment in energyScientist urges government to address peak oil riskStagecoach's electric hybrid buses launch in OxfordClimateRich countries to pay energy giants to build new coal-fired power plantsEconomyChina's economic growth rate slows to 10.3%Rio Tinto warns of double-dip recession OilBP Says Oil Flow Has Stopped as Cap Is TestedCampbell Robertson and Henry Fountain, New York Times, 15 Jul 2010View original article
BP said Thursday that it had capped its hemorrhaging well, at least temporarily, marking the first time in 86 days that oil was not gushing into the Gulf of Mexico.
Oil stopped flowing around 2:25 p.m. when the last of several valves was closed on a cap at the top of the well, said Kent Wells, a senior vice president for BP...
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BP faces 7-year offshore drilling banBBC Online, 15 Jul 2010View original article
A US Congressional committee has agreed measures that would ban BP from new offshore drilling for seven years.
The House committee on natural resources voted in favour of precluding companies with poor safety records from offshore oil exploration permits...
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Obama renews ban on deepwater drillingAnna Fifield in Washington, Financial Times, 13 Jul 2010View original article
The Obama administration on Monday renewed its ban on deepwater drilling, imposed after the BP oil spill.
The moratorium was also revised to apply to any deepwater floating facility with drilling activities...
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BP admits 'lobbying UK over Libya prisoner transfer scheme but not Lockerbie bombAndrew Hough, The Daily Telegraph, 15 Jul 2010View original article
BP said it pressed for a deal over the controversial prisoner transfer agreement (PTA) amid fears any delays to negotiations would damage its "commercial interests" and disrupt its ВЈ900 million offshore drilling operations in the region.
But it denied claims that it had been involved in negotiations concerning the release of Megrahi, the Lockerbie bomber freed by Scottish authorities last year.
The admission came just hours after Hillary Clinton, the US Secretary of State, pledged to investigate allegations of BP's involvement in his release ahead of its planned new drilling in Libya...
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EU commissioner repeats drill ban callBBC Online, 15 Jul 2010View original article
Europe's energy commissioner has repeated his call for a ban on deep water oil drilling in the wake of the Gulf of Mexico disaster.
Gunther Oettinger met industry representatives on Wednesday after he suggested drilling should stop while the risks of a similar spill in the North Sea were examined...
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Crude Oil Poised for Second Weekly Gain on Equity Gain, Dollar Grant Smith, Bloomberg, 16 Jul 2010View original article
Crude oil is heading for a second weekly gain as advancing equity markets reinforced expectations that fuel demand will increase and the dollar weakened against the euro, making oil cheaper for European investors.
Reports from the International Energy Agency and the Organization of Petroleum Exporting Countries forecast that this year's demand recovery will continue into 2011. Crude fell earlier today as manufacturing in New York and Pennsylvania dropped, part of a nationwide decline in factory production of 0.4 percent in June...
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Nigeria denies state oil firm NNPC bankruptBBC Online, 15 Jul 2010View original article
The Nigerian government has strongly denied claims that the state oil company is bankrupt, shortly after a junior minister said it was insolvent.
On Tuesday, Junior Finance Minister Remi Babalola said the Nigerian National Petroleum Corporation was unable to pay debts of $5bn (ВЈ3.3bn)...
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IEA forecasts slower oil demand growth in 2011Emma Farge and Alex Lawler - Reuters, arabianbusiness.com, 15 Jul 2010View original article
Global oil demand growth will slow next year, leaving the market with comfortable supplies until at least the middle of next year, the International Energy Agency said in its monthly Oil Market Report on Tuesday.
Global oil demand will grow by 1.35 million barrels per day (bpd) next year to 87.84 million bpd, the IEA said in its first 2011 demand projection in a monthly report...
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Sudan oil row threatens peace ahead of referendumXan Rice in Nairobi, The Guardian, 14 Jul 2010View original article
The civil war between north and south Sudan that claimed two millions lives could restart unless agreements over oil and borders are reached before an independence referendum in six months, says an authoritative new report.
A coalition of 26 international and local humanitarian organisations today warned that the country was "alarmingly unprepared" for the vote, which is likely see Africa's largest state split in two...
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BP in talks with Apache over sale of giant oil field at Prudhoe Bay Robin Pagnamenta Energy Editor, The Times, 12 Jul 2010View original article
BP is in talks to sell its stake in America's biggest oil field, the Prudhoe Bay project in Alaska, as it scrambles to shore up its finances in the wake of the Gulf of Mexico oil disaster.
In the first sign of what appears to be a major strategic shift in focus away from the US, the British oil giant is negotiating with Apache Corporation, a Houston-based company, about an ВЈ8 billion sale of a string of American assets, including Prudhoe on Alaska's North Slope...
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Brazil Starts New Libra Oil Well as Mechanical Problem Halts First AttemptBy Peter Millard, Bloomberg.com, 13 Jul 2010View original article
Brazil said it started drilling a second well at its offshore Libra oil field after a "mechanical problem" forced it to abandon a previous attempt to assess the size of the deepwater reserves.
Drilling of a new well about 370 meters (1,214 feet) away from the first began last week, the press office of the ANP oil regulator said today in an e-mailed response to questions. The ANP said in May, when the first well was started, that it would take about five months to complete...
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Kazakh duty ruling rewrites oil termsCatherine Belton in Moscow, Financial Times, 14 Jul 2010View original article
The Kazakh government said on Tuesday it would impose a duty on most crude exports – a decision that effectively rewrites the rules of long standing production sharing agreements it has with two international oil consortiums...
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RenewablesSpain overtakes US with world's biggest solar power stationStephen Burgen, The Guardian, 13 Jul 2010View original article
Spain has opened the world's largest solar power station, meaning that it overtakes the US as the biggest solar generator in the world. The nation's total solar power production is now equivalent to the output of a nuclear power station.
Spain is a world leader in renewable energies and has long been a producer of hydro-electricity (only China and the US have built more dams). It also has a highly developed wind power sector which, like solar power, has received generous government subsidies...
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Sweden leads the European Union on renewable energyRelaxnews, The Independent, 14 Jul 2010View original article
Sweden leads the European Union on renewable energy, producing 44.4 percent of its energy from renewable sources but Malta, Luxembourg and the United Kingdom lag behind.
Renewable energy contributed 10.3 percent of total energy consumption in the EU27 in 2008 according to a July 13 report by the statistical Office of the European Union Eurostat...
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Stabilisers will let deep-sea wind turbines stand tallJeff Hecht, New Scientist, 09 Jul 2010View original article
FAR out to sea is nirvana for wind energy generation. Here the winds blow stronger and the giant turbines are less of an eyesore. But how to keep them from toppling over in a gale? That is the challenge being tackled by a consortium of universities and private companies called DeepCwind.
The consortium will install a scaled-down prototype of a new design of wind turbine near Monhegan Island, Maine, in 2012. If all goes well, two years later a full-sized version with a capacity of 3 to 5 megawatts will be installed, probably much further out. This could pave the way for wind turbines moored in deep water off coastal cities...
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BiofuelsAlgae to take off as weapon in fight against fuel costMichael Evans Pentagon Correspondent, The Times, 15 Jul 2010View original article
The US military has been told to go green to cut costs after the Pentagon's fuel bill hit $20 billion (ВЈ13 billion) a year.
The biggest energy-saving campaign by the Pentagon is forcing the armed services to look at alternative ways of powering aircraft, ships and armoured vehicles. Algae, vegetable oil and even animal fat are coming to the rescue...
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UKBP's Crisis Could Soon Become Great Britain'sFrank Dohmen and Marco Evers, Der Speigel, 13 Jul 2010View original article
With the oil continuing to flow into the Gulf of Mexico, BP is facing ever greater challenges. Already, the company has lost half its market value. Should it be unable to cap the leaking well soon, the British oil giant may be forced to sell of assets. That could spell disaster for Great Britain.
Such a crash has never before been seen. Fewer than 12 weeks ago, the multinational oil giant BP still held an uncontested fourth place on the list of the world's largest companies. Its impressive balance sheet boasted annual sales of roughly $246 billion (€195 billion), a market value of more than $190 billion and after-tax profits of almost $17 billion...
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Spill costs to cut BP tax bill by $10bnEd Crooks, Energy Editor, Financial Times, 13 Jul 2010View original article
BP is forecast to pay about $10bn (ВЈ6.7bn) less tax over the next four years as it meets the costs of its huge oil spill in the Gulf of Mexico, hitting the revenues of Britain and the US that receive hundreds of millions of dollars from the company each year...
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Business warns on need for investment in energyBrian Groom, Business and Employment Editor, Financial Times, 12 Jul 2010View original article
The UK is in the "last chance saloon" to secure investment in its creaking energy infrastructure, ministers are being warned by a leading business group...
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Scientist urges government to address peak oil riskFrom BusinessGreen, part of the Guardian Environment Network, The Guardian, 14 Jul 2010View original article
Peak oil presents the world with an energy crisis once supplies start to dwindle any time from 2015. But another growing crisis is looming, with potentially devastating consequences for the world's food supply.
Phosphorous is an essential nutrient for plant growth, along with nitrogen and potassium. It is a key component in DNA and plays an essential role in plant energy metabolism. Without it, crops would fail, causing the human food chain to collapse...
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Stagecoach's electric hybrid buses launch in OxfordBBC Online, 15 Jul 2010View original article
Stagecoach has launched the first electric hybrid buses in Oxford.
The 26 double-deckers emit 30% less carbon than standard vehicles and will operate on some of the busiest city centre routes...
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ClimateRich countries to pay energy giants to build new coal-fired power plantsJohn Vidal, environment editor, The Guardian, 14 Jul 2010View original article
The UN is set to channel billions of pounds of public money from rich countries to giant energy companies to build 20 heavily polluting coal-fired power plants on the basis that they will emit less carbon dioxide than older ones.
Data seen by the Guardian shows that 12 companies have applied to the UN for hundreds of millions of emission reduction credits to subsidise "efficient" coal-fired power stations in China and India. Many of the plants would be paid for with carbon offsets bought by British and European companies in lieu of cutting their own emissions...
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EconomyChina's economic growth rate slows to 10.3%BBC Online, 15 Jul 2010View original article
The pace of growth in the world's third-largest economy slowed in the second quarter, official figures show.
China's economy grew by 10.3% in the April-to-June quarter, above the government's growth target, but well below the 11.9% growth rate during the first quarter of the year...
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Rio Tinto warns of double-dip recessionRobert Lea Industrial Editor, The Times, 14 Jul 2010View original article
The world's second-largest producer of iron ore for the global steel industry warned today of a double-dip recession in developed countries and a slowdown of growth in China...
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Is net energy peaking?Gulf spill won’t dampen U.S. appetite for oil
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