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Archive for the tag “petroleum”

ANOTHER OIL CRISIS?

NO, JUST ANOTHER AMERICAN POLITICAL MOVE TO PROTECT SAUDI AND OPEC INTERESTS!

This will be the 800th article I have posted on this blog and one that is extremely important. Anyone who denies history repeats itself has never worked in the petroleum industry. After spending 27 years in the aerospace industry I made a career change in 1978 and accepted an executive position with Otis Engineering that was a major part of the Halliburton Corporation. I spent my last sixteen years working in the petroleum industry. Am I an expert? No. But I did learn enough and know what to read and how to express myself professionally. My conservative views were developed over my 84 years as a freedom loving American. I challenge you to prove me wrong with verifiable facts.

I would be remiss to omit that the reason I made this career change. Our US Department of the Interior imposed a new regulation on the petroleum industry that was similar to the regulations developed by the NRC several years before. The exploration and production operations in the oil industry were baffled along with every company that designed and manufactured surface and sub-surface safety valves used in US offshore waters. Unlike the NRC program that covered all equipment used in a power plant this regulation was only required on two of the hundreds of devices used to drill and produce oil and gas. If all devices like the blowout preventer had been included the BP accident may have been avoidable. Another unusual feature of the regulation, it was not required on any onshore wells, government lands included. My 27 years work with government regulations and a new Masters Degree were a valuable asset during this period.

I missed the 1973 oil crisis but when the second man-made crisis erupted in 1983 I chose to try my lifelong dream to start my own company. I suppose I should thank OPEC and our government for creating this crisis. This allowed me to successfully end my work career by exceeding the achievement of every goal I had set for myself as a young man.

When will the American voters get enough of these government sponsored events that stop or critically cripple the American petroleum industry to create jobs and threaten OPEC’s manipulation of oil prices. Every time they force the American companies to stop drilling, it only helps OPEC eventually. After they cripple our petroleum industry, it is obvious it will take years to get it revived at costs that are just wasted to help the Arabs.

I suppose that crippling the petroleum industry to make foreign and American bankers richer is better than starting political wars to achieve the same purposes is better, but why do either? I have lived through so many political wars and energy crises to make the rich richer and the politicians more powerful that make me sick.

Do you realize that until the government and OPEC started this last crisis what the oil industry had accomplished? U.S. oil production increased from 5.6 million barrels a day in 2010, to a current rate of 9.3 million barrels a day. The government and OPEC tried to kill this boom by scaring people with propaganda about the dangers of fracking.

Until the Arabs got greedy and artificially increased the price of crude above $100 a barrel, fracking was not an option due to costs. We have known about the shale oil deposits in America for a long time but producing it was estimated to be at least $50 a barrel as far back as the 1980’s when I was with Halliburton. Until late last year and this latest crisis, it was obvious that US oil output would keep rising in 1 million barrel-plus annual leaps for years to come.

The recent drop in oil prices poses another major challenge to oil producers. Wall Street analysts, politicians and even some industry experts claim the setback will be brief and minor. Just history repeating itself with man-made crises again.

Shale oil production is totally unlike oil production in any other part of the world. In conventional wells, whether in the Middle East, the Gulf of Mexico or the North Sea. When prices drop, however, almost all conventional wells keep pumping. That’s because the variable cost of lifting the crude is still far lower than the prices it fetches on the world market.

I just read a quote that explains this. “What drives the business is the marginal cost, not the total cost,” says Ronald Ripple, a finance and energy business professor at the University of Tulsa. “Even at low prices, the production is still contributing something to cover the upfront investment.” The average person has no idea what the risk and investment can be to drill and produce oil.

As a result, the global supply of oil is what economists call “inelastic.” Even if prices crater, the oil majors and sheiks keep pumping more or less the same quantities. They’ll only stop when prices drop below the variable cost—and for most wells, they seldom sink that far.

Another determinant of oil prices, now, is demand. Oil consumption in the U.S. has fallen by over 8% since 2010, and the shrinkage in Europe even greater. Reports indicate that China and India oil usage has not accelerated anywhere near what had been forecasted. The drop in oil prices from over $100 in May to $48 has not caused a major or even minor drop in overall production.

Unlike conventional production, shale wells have an extremely short life. To produce a constant or increasing revenue, producers must constantly drill new wells, since their existing wells span a mere half-life by industry standards. I have read that shale oil production is more like mining than conventional oil production. Mining companies must dig new holes, year after year, to extract reserves of copper or iron ore.

Today the breakeven cost for producing shale oil is $65 per barrel, according to a study by Rystad Energy and Morgan Stanley Commodity Research. Producing shale oil at $65 a barrel and selling it at $48 is a rapid way to go broke.

To make matter worse, we are seeing the same actions that every crises causes. I just read that the count of rotary rigs in use has fallen from 1,930 to 1,881 since October. We saw the same reduction in offshore rigs when our government over regulated an entire industry because of the isolated drilling accident in the Gulf of Mexico. The US government is a bigger enemy than OPEC. Living in Texas it is sad to see the thousands of jobs we have created that are vanishing with the small operators going broke.

If demand for oil rebounds as some say it will and the price of oil rises above $65 again, producing shale oil may once again be profitable. I for one will be surprised if the enemies of fracking, our government and Saudi Arabia, will ever allow that to happen. I just read that the Saudis have invested heavily to gain extra capacity of 2 million barrels a day. The Saudis with our government support will use that excess to hold prices at $50 a barrel to stop all shale production.

Maintaining current production will take a massive new conventional drilling program. I am sure that the current US President and Congress will make sure that this does not happen. The political points they will enjoy with $2.00 a gallon gas will far outweigh the loss of many thousands of lost jobs that are inevitable. 

If buying OPEC oil and cheaper gasoline makes you happy just re-elect your Congressperson and Hillary in 2016. If you are an unemployed petroleum industry American and you really want to work for an above average living you probably live in the wrong country.

The political views are mine alone. I wonder how many Americans agree with me?   C Brewer

HAPPY JULY THE FOURTH

I hope every American loves this country as much as I do? No one can possibly love it more than I do. Go out of your way today to tell a veteran and every active duty member of our military that you appreciate their service. What freedoms we have left we owe to these brave people and the ones who gave their life to protect our Republic.

God was abundantly fair to let me be born in this great country and also instill in me the pride that is being destroyed for my children. God gave me a mind but I chose to use it. God gave me the courage and confidence that drove my success. It was my responsibility to use these assets. God chooses to provide most Americans the same opportunity.

Unfortunately we are watching our government slowly replace God in the hearts of our people. Love of our freedoms, unselfishness, hard work and pride has been replaced. Now we have a President of this country, who did not challenge his own wife, when she said in context, “Until my Husband became President, I never loved this country”, why? We have a President who is destroying our freedoms and prosperity on purpose and using race as the bait to hope for anarchy in the streets. He smiles and lies to create a welfare society and sadly, he is succeeding.

Who on earth, that is able to provide for their family, would desire to work if they had everything given to them free. The answer is any freedom loving, self driven patriot. Backed by a Congress, Judiciary, and greedy lobbyist, America is being driven towards failure and on purpose. Let me pose two specific questions that every American should answer with honesty. I could add so many others that no one would read the entire message.

1. Why do we empower other nations to strip us of jobs by letting politicians pander to greedy unions? Unions don’t create jobs, especially government unions.

2. Why do we sit on our hands and see this country driven into bankruptcy by buying petroleum from others to enrich them, instead of putting people to work and selling petroleum products to our friends? Why? The Obama team, tree huggers, environmental nuts and the EPA are the Arabs best friends. They are supported by a Congress that is useless and too many Americans who expect others to provide for their lazy asses.

I served in the military, enjoyed a successful career and provided for us to comfortably retire without being a burden on my heirs. I really enjoyed 76 of my nearly 82 years with total happiness. Now Obama and his treacherous allies in Congress have taken 30% of my savings, doubled my healthcare costs and because I am over 75 a healthcare panel will now decide when I die.

There are some things they can’t take away from me until Government, instead of God, decides when the fat lady sings. They can’t take away my pride, honor, love for God, my family and hope.

They also can’t prohibit me, at least not yet, from asking every freedom loving American to wake up and clean house in Washington D.C. in November.

Even the blind can see what these misguided, power hungry, greedy, bleepity bleeps (the Navy taught me some rather seedy language that Norma corrected), have already done to America. Can you imagine what four more years can destroy?      

Again let me wish every American a happy fourth of July from someone who still salutes our flag, prays to God and gets teary every time I hear the Star Spangled Banner.

 

GOD SAVE AMERICA

 

C. Brewer July 4th, 2012

GASOLINE PRICE INCREASES-WHY?

 

 Regardless of how President Obama and his “Progressive” democrats, tree hugging lunatics, GE, Bill O’Reilly and the main stream media misinform you, the major oil companies have never been the reason for increased prices of gasoline. For purposes to identify this misguided group I will refer to them as “Obama’s Weirdo’s”. 

Price controls that this group always threatens to use, will not have any effect to lower what you pay for gasoline. If anything, it could cause the price to go higher.

To explain all of the reasons affecting the price of crude oil would end up being a book. OPEC alone could have a million reasons that would cause wild increases. With lunatics like Chavez, Qaddafi and Ahmadinejad impacting prices, they can shut down production if they wake up with a toothache. In my opinion the manipulators like George Soros and the arbiters who speculate in the futures market are the primary reason for most increases we had seen over time. These are the same people who make sure “Obama’s Weirdo’s” are funded to keep you excited. If you have time to read the millions of pages of events over the past forty years you would agree. Prove me wrong with facts, if you have the time, and I will apologize.  

The tree huggers would outlaw all gasoline using products and use oil to make plastic toilet paper. We would revert back to the horse and buggy for transportation. Airplanes and trains would be eliminated. Can you imagine the piles of horse crap that would pile up on a transcontinental trip?

Progressives have been screaming for 40 years for raising gas prices like they have had in Europe. They want the extra money to spread the wealth with welfare. Recently they are pushing for a Value Added Tax (VAT) like Europe, again to have more money to redistribute the wealth. Every idea they come up with punishes the people they have brain washed with money to not work, the poor.

Only one person on earth can stop the recurring oil price madness. Who can stop it in 24 hours, the President of the United States of America? Bush did it. Will Obama use this power, no he just keep blaming anyone he can. He stood up in front of America last Friday and lied to the people is why I make this statement. He told the American people that American oil reserves are not adequate to reduce our dependence on foreign oil. He stated that we have only two percent of the world’s oil reserves. Both of these statements are outright lies.  He stated that domestic oil production in 2010 was at its highest point in seven years which is misleading. Ten years ago our oil production was ten percent more than in 2010. In 1970 it was double what was produced in 2010. It has steadily decreased over the past forty years because drilling has been regulated and controlled by the “Weirdo’s” under most Presidents since Carter.

In 2009 the non partisan Congressional Research Service (SRS) reported that the U.S. supply of recoverable oil to be 167 billion barrels. This would allow us to have more than 75 years of not buying any oil from foreign sources like OPEC. That does not include the natural gas and coal reserves. SRS reported that when you add these other two resources we have the equivalent of 1.3 trillion barrels of oil.

In addition the U.S. Geological Survey announced that the Arctic areas of Alaska and offshore has about 90 billion barrels of oil. That alone is more than Nigeria, Kazakhstan, and Mexico combined.

If you seek the truth, ever since Obama was elected, there has been a constant pressure to impede more drilling. His success has been to make Americans more dependent on foreign oil and share more of our wealth with OPEC lunatics.

I have visited the Middle East and North Africa in my travels, working in the petroleum industry. Let me warn you about another asset they have a world class quantity of readily available. Should science ever find a way that will demand buying sand for America to survive, we are in real trouble. I can visualize it now, it will be known as the Organization of Sand Exporting Countries, OSEC.

Obama can force the price of oil to drop tomorrow with one simple announcement, “All regulations and barriers on domestic oil drilling have been eliminated effective today”.

For Tadpole and the rest of American’s who care, it’s your time, stand up and demand that the President and Congress act or just get out of the way.

C Brewer   

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    • cbeck75948
      Mar 22, 2011 @ 21:35:12 [Edit]

      I spent 15 years traveling the world in the petroleum inductry. Chaired ANSI/ASME committee on offshore safety valves for a few years. I am nearing 81 and I read at least four hours a day on topics in the news. I do not watch the so called main stream media even give the weather as they can’t even do the weathers without an Al Gore/Michael Moore slant. I love this country and hope it stays togrether for my grandkids. C Brewer

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AMERICAN “ROYALTY”- PART ONE

 

Over the next few weeks I will share a vision of a transformation I have watched as a Texas boy,  man and now an 80 year old senior citizen. The recent election, news reports of how Congress and the President have reacted prompted me to share these facts with anyone interested in living in a free country. Is is a fact that we are spending ourselves into a position that “will” reduce the most powerful country in the history of the world, to a second class society. Our President is hell-bent on re-aligning our country from a “Republic” of freedom to a socialist democracy.

For those who are interested in creditability I have been retired for nearly 17 years. I served in manager and executive positions for 27 years in the aerospace industry, 5 years in the oil industry and some 10 years in management consulting and training. I am a retired Registered Professional Engineer with a Master Degree in Management I am a retired member of Mensa, Intertel, American Society of Mechanical Engineers, Society of Petroleum and the American Society for Quality. My entire work life was associated with “Customer Satisfaction/ Quality”.  I have been fortunate to have worked or visited in 32 countries and 49 States. I have worked in;  Kingdoms and Emirates in the middle east; Socialist countries of Norway, Sweden, Denmark, France and others; Algeria, Germany, the Netherlands, Belgium, England, Scotland, Malaysia, Thailand, Singapore; Malaysia, Indonesia, Mexico, Canada. You will note that many of these countries are dominately Muslim. I have also done work for companies in Columbia and India. I joined the U.S. Navy at 17 and served nearly 3.5 years on active duty before my 21st birthday.

Growing up in Texas in the 1930’s was not as pleasant as life today. My first 9 years of school were in Corsicana, Texas. A town of 33% gentiles, 33% Colored, 33% Jewish and 1% who had some money. As most families were either poor, poorer and poorest I never realized we were poor. Texas had nothing but conservative democrats, and Lyndon Johnson. My first realization that people who did have money were not all misers. We had a Andrew Carnegie library that provided me the opportunity to read and learn free at my will. I give this library credit for the beginning of my ability to reach my full potential and success in my life at 63. None of the above countries where I have worked provide the freedoms to allow you to reach your full potential. What scares me is that my heirs will lose this freedom if we the people do not reduce the power of government and alter the current plans of the “American Royalty”.

Over the years we have seen political office holders at every level from County, State, and nationally change from public servants to full-time “Royalty”. Now political offices are full time occupations. The level of “Royalty” is adjusted at each level. When you get to Congress, the Executive and the Judicial branches of our government, the advantages of “Royalty” increase exponentially higher.

To capture your interest in following this series let me use one example that has been predominate in the news this week. This involves Mr. Charles Rangel. The only thing I have in common with Mr. Rangel is that we are both 80. To illustrate the fact that Mr. Rangel has “Royalty Status”, let me state some facts.

1. He has been charged of hiding $600,000.00 in assets ( he says it was an oversight). 2. Failure to pay income tax on offshore assets (he says this was an oversight). 3. Paying his lawyers with illegal funds ( nothing said yet). 4. Zoning infractions in his home district offices ( a misunderstanding). 5. Misuse of free mailing privileges ( I have not heard his response). This is just a sample of the 13 charges he was tried on by a congressional committee just this week. He was convicted on 11 of the charges. I have seen nothing in the news to even say he has paid the back taxes which I doubt as an individual. Let me go on record today, 11-18-2010, and say that his punishment will be, at most, a slap on the wrist and some form of documented sanction that will mean nothing.

Now let me compare this using me, just a common person, as an example of the way us “Non-Royals” would be treated. Hiding assets would get me a prison term, a fine and ruin my life. Income tax evasion would get me a penalty, a fine and an audit every year for the rest of my life. Using illegal funds would get me a fine and prison sentence for money laundering. Zoning infractions would result in a fine as a minimum. Mis-use of the postal system would get me a fine and prison sentence for mail fraud.

If these events alone do not convience you we have a “Royalty” class in America, just read the entire series.

The democratic/progressive/environmentalist leaders had their hand called in the race to socialize America in the last election. Now the republicans have one more chance to show they can manage and lead the country. If they fail this time America will be a one party system and a virtual Kingdom. I will explain my reasoning for this in Part Two.

Clyde Brewer

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