Outrun Change

We need to learn quickly to keep up with the massive change around us so we don't get run over. We need to outrun change.

Archive for the category “Energy”

Illustration of relation between proved reserves, economically & technically recoverable and original oil in place.

Here is a graphic that shows how the different categories of oil and gas relate to each other.

From most certain to least certain and then the total:

  • Cumulative production to date
  • Proved reserves
  • Economically recoverable resources
  • Technically recoverable resources
  • Remaining oil and natural gas in-place
  • Original oil and natural gas in-place

 

Courtesy of U.S. Energy Information Administration.

This illustration is from Technically Recoverable Shale Oil and Shale Gas Resources, from the U.S. Energy Information Administration.

Hat tip: The Million Dollar Way

Update: If you have any passing interest in what I say about the energy industry or oil or North Dakota, you really, really should be reading The Million Dollar Way regularly. If you landed here from the gracious shout-out over at MDW you already knew that. Mr. Oksol’s writing at that blog has provided a large portion of the learning I’ve gained on energy issues.

Increased interest in “The Overnighters” documentary – part 3 of 3

Flaring of natural gas. A common site in 2012 and 2013, but is rare today. Photo by James Ulvog.

There has been a lot more interest in my posts on “The Overnighters” documentary recently. This is the third and final part of this series of followup on the documentary. Previous discussions include my disclosures, and reporting with agendas.

This post will close with some lessons we can learn from this disaster.

Other articles

As I was looking for some source of the increased interest lately, I also came across some older articles I’ve not noticed before. Keeping in mind my extended discussion in part 2 about writing with agendas, these additional articles have a minimal agenda visible.

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Increased interest in “The Overnighters” documentary – part 2 of 3

Flaring of natural gas. A common site in 2012 and 2013, but is rare today. Photo by James Ulvog.

There has been a lot more interest in my posts on “The Overnighters” documentary recently. This is part 2 of my followup on the documentary. Previous discussion, including my disclosures, is here.

Might want to get a fresh cup of coffee. This will be a long read.

Reading a story when I know more than the reporter

It is fascinating to read coverage of a story when I have in-depth knowledge of the issue.

Read more…

Increased interest in “The Overnighters” documentary – part 1 of 3

Flaring of natural gas. A common site in 2012 and 2013, but is rare today. Photo by James Ulvog.

There has been a lot more interest in my posts on “The Overnighters” documentary recently. In particular, my 7/2/15 discussion of Where are they now? Follow up on people you saw in The Overnighters documentary has been getting a lot of page views. It has been running between 100 and 130 views a month for the last six months, with a peak of 217 views in January. Yesterday, 7/16/17, there were 62 views.

While those counts of page views are trivially small for the internet world, that’s a lot of attention to one of my posts, especially one that is two years old.

Did some searches online and cannot find what in particular is driving that growing interest. Did find a few things that I wanted to mention.

“Overnighters” streaming on Netflix in July and

running on lots of PBS stations

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Average daily oil production in North Dakota down 0.98% in May 2017

Oil production in the state dropped about 1% in May, falling from average of 1,050,476 bopd in April (final) to 1,040,131 bopd in May (preliminary) That is a drop of 10,345 bopd for the month.

Million Dollar Way highlights the NDIC says a shortage of experience workers is slowing down completions.

Article also points out it will take another month to see what impact DAPL will having on the amount of oil shipped by rail. This is a big deal on the revenue realized by producers.

The spread between West Texas Intermediate and what Bakken producers get is about $11 a barrel. That is the cost of transport. The spread is expected to be $6 or $7 for oil shipped through DAPL.

Here are a few graphs to tell the production story:

Average production for state and Bakken only:

Value of monthly production, which seems to have stabilized in the last six months or so:

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More on the downside of unreliable wind power: paying for decommissioning costs

I count 64 turbine towers in that view. Photo by James Ulvog, somewhere southwest of Williston, en route to Denver.

There will be major costs involved in decommissioning wind turbines. Who will pay?

3/8/17 – Stop These Things – Farmers “Hosting” Wind Turbines Faces Massive Clean Up Bills & Other Legal Liability – Legislation is under consideration which would force wind power companies to set aside money to decommission the turbines. At the moment the corporate shells holding the producing assets have nothing set aside. Without some requirement for accumulating reserves, neither the holding company nor the entity’s parents will have any responsibility to clean up the site. There will be no recourse by landowners or regulators to force the then-empty shells to clean up the sites.  That will leave the landowner or the local government or the national government holding the bill for decommissioning.

Disposing of a wind turbine means finding some way to get rid of the toxic blades, the generator containing large amounts of rare earth metals, and 1000 metric tons of buried concrete.

Situation is similarly bad in Australia. Read more…

More on the downside of unreliable solar power: Paying to get rid of excess electricity.

Photo by James Ulvog.

There is so much excess electricity from solar power that sometimes California has to pay utilities in other states to take it. Also, what will we do with all those panels when they wear out?

6/22/17 – Los Angeles Times – California invested heavily in solar power. Now there is so much that other states are sometimes paid to take it – There are two non-negotiable physical laws that undercut the value of solar power.

First, electricity must be used the instant it is generated. Second, solar power is generated when the sun is bright not necessarily when the electricity is needed.

Some days, there is so much solar power in California that “we” have to pay utilities in Arizona to take the electricity in order to keep from overloading the grid in California.

Read more…

The massive economic and environmental impact of fracking.

Wells being drilled by that rig have long since gone into operation and contributed their share to increased US production.

The impact of fracking is massive. Large increases in production of natural gas and crude oil has created a long list of favorable economic and environment impacts.

7/6/17 – Victor Davis Hanson at National Review – The Fracking Industry Deserves Our Gratitude – Prof. Hanson provides a fast survey of how much fracking has improved the American economy. Fracking is the combination of horizontal drilling with hydraulic fracturing.

The impact of fracking is staggering.

Ten years ago eeeeeeverybody knew for an absolute certainty that Peak Oil was here and we were about to run out of oil. The Secretary of Energy was wishfully musing that gasoline would rise from $4 to $10 a gallon.

In the last five years, gasoline prices are down about $1.50 a gallon, surge in natural gas production displaced coal consumption which has reduced our CO2 output by 12% in the last decade (surpassing the EU in cuts), and reduced our oil imports by five million barrels a day.

Let me rephrase that part about CO2…

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More articles on the downside of intermittent power

The heat on that rooftop during a hot day degrades performance.   “Solar Panel” by Marufish is licensed under CC BY-SA 2.0

A few articles over the last month on the substantial problems from trying to rely on intermittent power sources.

  • Heavy use of wind and solar in Germany is also destabilizing the grid in Poland and Czech Republic
  • New words to use when discussing intermittent energy:  energy from weather; wind plants (not farms); corporate welfare recipients
  • Effective capacity from energy sources in US (actual output compared to theoretical nameplate rating):  wind 13%, solar 38%, natural gas 87%
  • Solar panels lose output when it is really hot on the roof

2/16/17 – Wall Street Journal – In Central Europe, Germany’s Renewable Revolution Causes Friction / The country’s surplus power, a byproduct of its shift to green energy, is spilling over into Poland and Czech Republic, straining their electrical grids – Germany’s grand plan of Energiewende (meaning energy revolution) involves generating massive amounts of unreliable and unpredictable power from solar and wind sources in the northern part of the country for use in the industry intensive southern region. An additional problem (beyond massive surge and drops in production) is the country does not have enough power lines to transmit the electricity from the north to the south. As a result the power is transferred into Poland and Czech Republic and then in turn transmitted to southern Germany. Essentially the electricity is rerouted a couple hundred miles east before it is routed 400 or 500 miles south.

The complication is that on those days with lots of sunlight and those hours when there happens to strong wind (but not too much) the Polish and Czech energy markets are overwhelmed with surplus energy.

Read more…

Change in Saudi Arabia power structure. News on oil prices.

Photo , in the public domain, of Mohammed bin Salman (now crown prince of Saudi Arabia) meeting with President is courtesy of The White House.

Lots of developments in the oil world.

Biggest news, I think, is the change leader in Saudi Arabia has been appointed to the position of crown prince, meaning he is first in line for the throne.

Lots of news on dropping oil prices, which are due to increasing production, primarily in the U.S.

6/22/17 – Wall Street Journal – The Saudi Shake-Up Has One Goal: Drag the Country Into Modern Era – King Salman bin Abdulaziz has appointed his son, Mohammed bin Salman, as crown prince, making him the designated successor to the throne. The previous crown prince, Mohammed bin Nayef who was in charge of security, is now in retirement.

Mohammed bin Salman is the person pushing the modernization efforts in the country, trying to move the country away from dependency on oil production and massive subsidies to the population and toward a diversified economy with widespread entrepreneurial mindset. One part of that transition is taking Saudi Aramco public.

Read more…

More graphs of North Dakota oil production in April 2017

Yesterday’s post described the 2.4% increase in North Dakota oil production. Here are a few more graphs to tell the story.

Here is the average sweet crude price in the state by month:

 

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Oil production in North Dakota up 2.4% in April 2017

Big increase in production in the state. Increase of 2.43%, from average of 1,025,690 bopd in March (revised) to 1,050,630 bopd in April (preliminary). That is the highest average production since March 2016. The April production was only 160,700 below the high water mark of 1,207,276 bopd in July 2015.

 

That upslope since last fall is not quite what OPEC+Russia had in mind.

Million Dollar Way pointed out the production increased at the same time as the number of inactive wells increased and the fracklog increased. I sure don’t understand the dynamics.

Producing wells increased 122 to 13,434; fracklog increased 141 to 830; inactive well count increased 167 to 1,466. Some of that is a recovery from drops in March.

Here is another graph of production, for a longer term perspective:

Read more…

News from Bakken oil patch

Rig in western North Dakota. Photographer was given tour of site resulting in many nice photos. “Oil Rig” by Lindsey G is licensed under CC BY 2.0

A few tidbits from western North Dakota:

  • More signs of a rebound
  • Amy Dalrymple joins staff of Bismarck Tribune
  • Dakota Access Pipeline begins commercial operations

6/3/17 – Star Tribune – North Dakota oil industry shows signs of a rebound – Drilling and employment is picking up in the North Dakota oil patch. Article illustrates this by telling the tale of several guys who have been out of work for a while but have been rehired.

Several analysts are quoted saying the industry is bouncing back.

Interesting stats in the article:

  • An oil rig is 13 stories tall, weighs 275 tons, and costs somewhere between $50,000 and $70,000 per day to operate.
  • Rig count: 51 now, 218 at high point in December 2012, 27 at low point in May 2016.
  • Oilfield employment in the state is 16,400 in April 2017, which is up 10% over same month in 2016.
  • Online postings for open jobs were at the highest in April over the last year and are up 94% from prior year. A trade group representative says there are likely 1,000 open oil jobs in western North Dakota.
  • Total production in Bakken is down 1.5% in the last 12 months. Meanwhile production in the Permian basin is up 25% in the last year.

Efficiency drivers:

Read more…

How to cope with the intermittent output from solar power plants during a solar eclipse? Turn off your air conditioning and sweat it out.

For one day in August the Ivanpah facility won’t be incinerating as many birds as usual, due to the solar eclipse. Photo by James Ulvog.

Yeah, turn up the a/c temp is what those of us in California should do during the solar eclipse on August 21, according to the CPUC. Sweat it out.

The eclipse will start about 9 a.m. and hit maximum sun coverage about 10:20, with full sun resuming about 11:54 a.m.

Two issues. That is the front end of peak solar production during the day and August 21 is likely to be a hot day. That means output from solar plants will be lower than usual while demand for electricity will likely be higher than usual.

Drop in amount of sunlight is expected to be about 62% in SoCal, around 76% in northern part of state.

During the eclipse, about two-thirds of the solar production will be lost at the time of day when about 40% of our electricity comes from solar plants. Using those numbers means we will lose about 27% of our electricity production during that three hour time frame.

Read more…

Peak Oil Demand. A real thing? Or only as real as Peak Oil Supply?

Photo of oil refinery courtesy of Dollar Photo Club prior to their merger into Adobe Stock.

Will demand for oil decline in the next decade or two? Or will demand continue to grow? Sorting out questions like that makes my brain hurt.

The Wall Street Journal had an extra report section 5/22/17 called Innovations in Energy. Some interesting comments:

5/22/17 – Wall Street Journal – Get Ready for Peak Oil Demand – In yet another complete repudiation of the foolish forecasts of Dr. M. King Hubert, there is a gathering consensus that instead of Peak Oil, meaning we will use up all the oil someday, we may be facing Peak Oil Demand, which is the idea that oil consumption may fall because of various factors such as improved  efficiency  in vehicles, electric/hybrid cars, and reliance on solar/wind power.

There are a lot of implications of Peak Demand, if that actually turns out to be a real thing.

For starters, there is massive impact on oil companies and the impact on oil prices. One additional factor is there would be an end to the severe pressure to always be finding more oil.

Article provides guesses from 7 major players in the energy world as to when we will see peak oil demand:

Read more…

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