Associated Press: Exxon CEO Talks About Energy Crunch.
"Raymond said companies are reluctant to build new refineries because profit margins are too small -- they could invest in other things `and you wouldn't have the aggravation of everybody accusing you of always cheating' by manipulating gasoline prices." ...
"The meeting was marked by protests inside and outside the hall by activists who urged Exxon Mobil to adopt environmental and gay-rights proposals. All were voted down, but supporters raised the threat of a U.S. boycott against the world's largest publicly owned oil company. `We will boycott your products, and we will not put a tiger in your tank,' said British environmental activist Bianca Jagger, referring to a longtime Exxon advertising slogan."
Oil & Gas Journal: Report: US independents' finding costs rose nearly 35% in 2000.
"[Salomon Smith Barney Analyst Robert] Morris said he expects to see continued consolidation within the industry both between the majors and independents and also among the independents. `The majors will still look to make acquisitions of independents in North America to increase their exposure to natural gas,' he said." ...
"Reserve replacement of domestic gas by independents last year was 164%, excluding revisions, while the US gas reserve replacement rate was 69% for the majors, excluding revisions. In 1999, independents replaced 117%, excluding revisions, while the majors replaced 52%, excluding revisions."
Associated Press: Conoco buying Gulf Canada Resources for $4.3 billion.
WSJ (subscription, but a much better article): Conoco Reaches Deal to Buy Gulf Canada For $4.33 Billion and Assumption of Debt.
"The deal, expected to close in the third quarter, would make Conoco the 11th largest oil company in North America, up from 20th, based on total oil and gas reserves."
World Oil: It's not easy being Green.
"This perceived pliability on BP's part also may be the reason some U.S. and British investors are pushing the company to abandon its intent to drill in the Arctic National Wildlife Refuge (ANWR) of Alaska, assuming it is ever opened to exploration. The investors had planned to introduce a shareholder resolution preventing same at the company's annual meeting last month, and at press time, BP had rebuffed the move."
> That adds a little context to the Reuters item I linked to on 05.22.
Scott Adams: Dilbert Goes to ANWR.
"It's hard to have a righteous opinion on the environment when you're as selfish and uninformed as I am. On one hand, I'm a cat-loving vegetarian who ought to care deeply about the caribou or koala bears or bats or whatever they have in Alaska. On the other hand, I live in California so I'd be willing to squeeze schoolchildren to death if I thought some oil would come out."
New York Times: It Gets 78 Miles a Gallon, but U.S. Snubs Diesel.
"Diesel engines burn as much as 30 percent less fuel than gasoline engines of comparable size, and they emit far less carbon dioxide and other greenhouse gases, which have been implicated in global warming." ...
"Albrecht Schmidt, a top expert on energy issues for Germany's Green Party, [says] `The big problem with diesel is the small particulates, but we think that problem can be solved with new particulate filters.' American environmentalists remain highly critical."
Houston Chronicle: Many fear recurrence of 1979 energy crisis.
"While production at U.S. domestic oil and gas fields is shrinking, the Baker Institute study noted, declining production played little role in creating the current shortages. More significant was underinvestment in energy infrastructure during the 1990s, a period when energy profits were low."
> ... and we were putting all our money in the dot-com's, same as everyone else.
> The article doesn't really make the point of the headline, but it's always fun reminiscing about the 70's.
Houston Chronicle: Texas has expectations of a powerful future.
"`We never want to be fat, dumb and happy,' said Pat Wood, chairman of the state Public Utility Commission. `We're fat now. We're happy now. But we're never dumb.'" ...
"Because it takes two or three years to build plants in Texas, Wood said there would be enough time to head off problems before they could develop."
Oil & Gas Journal: Trade groups oppose greenhouse gas emissions limits on new vehicles.
"They said EPA's authority under the Clean Air Act to limit emissions from new motor vehicles is limited to `air pollutants' anticipated to endanger public health or welfare. However, EPA has never determined greenhouse gases are air pollutants, the associations said."
> An interesting point, but I think they've answered it themselves. Something becomes an air pollutant by being declared an air pollutant. With the Clean Air Act, Congress delegated fairly broad discretion to the EPA to make those designations.
Oil & Gas Journal: Empire says magnetotelluric data prompt Australian wildcat.
"Empire said a thick surface outcrop of limestone prevented the accurate definition of structural closure with seismic, leading to a high proportion of dry holes being drilled off structure. Empire said the MT technique allows accurate depth control, enabling structural highs to be targeted."
> It would be nice if they run another story to let us know if it works.
Nature: Sink hopes sink.
"Some environmental policy-makers hope that forests might counter global warming by absorbing much of the extra carbon dioxide that humans are adding to the atmosphere, and that planting forests could substitute for reducing emissions." ...
"About half the carbon taken up by trees goes into their leaves. ... once a leaf falls from the tree, its carbon is back in the atmosphere in little over three years."
Oil & Gas Journal: US Senate turnover changes prospects for energy legislation.
Oil & Gas Journal: Oil and gas firms urged to find new ways to recruit, retain workers.
"`It's not acceptable that this industry does not employ enough women. It's not acceptable that it does not employ enough minorities,' said [John Gibson, president and CEO of Landmark Graphics Corp]."
> I met Gibson when he was at Chevron about seven years ago. He's a real positive guy with a lot of personal energy.
"Browne said BP was interested in Bush's proposal to open up part of the Arctic National Wildlife Refuge in Alaska to oil drilling and was confident that it could operate there in an environmentally responsible manner." ...
"However Browne, who has positioned BP as a `green' oil company, emphasized that the American people would have to decide first whether they wanted to allow drilling in the refuge which is home to caribou and polar bears. Corporations should not be part of the decision-making process, he said."
Oil & Gas Journal: Phillips, Anadarko open fields in National Petroleum Reserve-Alaska.
"Phillips Alaska Inc., a subsidiary of Phillips Petroleum Co., and Anadarko Petroleum Corp., Houston, Monday announced the first discoveries in the National Petroleum Reserve-Alaska (NPR-A) since it was reopened to exploration in 1999."
Oil & Gas Journal: Investment analysts see strong oil prices for 5 years.
> An odd article that never offers any support for its headline.
Washington Post: Myth of the Martyred Mapmaker.
"It's quite a story. But it's not quite a true story."
> I hate pointing at Doonesbury in such a negative context. I've followed the strip most of my life, and I'm a huge fan.
> If you think you know Doonesbury, you go ahead and take the quiz. And while you're at the site, you may want to sign up for daily email delivery.
Houston Chronicle: Energy burns bright as job generator.
Associated Press: Political brouhaha over Bush energy plan.
"`What's going on here, pure and simple, is unconscionable price gouging by the big energy producers - most of them - incidentally, located in Texas,' [said California Gov. Davis]."
New York Times: Burn, Baby, Burn.
"Just for laughs, Mr. Cheney threw in a few mock conservation measures. Topping the list was a tax credit for - get this - people who purchase hybrid gas-electric cars. In case you don't quite get the joke: during the campaign one of George W. Bush's favorite gag lines involved making fun of Al Gore's proposal for - you guessed it - a tax credit for purchase of hybrid cars. It got big laughs because it symbolized his opponent's supposed preoccupation with trivialities. Now, in a fine satirical gesture, Mr. Cheney has made the very same proposal his lead conservation measure."
New York Times: Half of refineries violating pollution laws.
American Council on Science & Health: Alaska Oil Fields And Caribou.
"The experience in the Prudhoe Bay oil fields is actually one of the great success stories in wildlife management. Other species besides caribou, including grizzly bears, have increased in numbers since the oil fields were developed. Clearly, the ANWR could be explored and developed without seriously affecting the wildlife populations."
> Oh, man, give it up! I'm all for drilling in ANWR too, but the reality is that the O&G industry is going to have to earn some environmental credibility first. Trying to push this right now is just counterproductive.
Denes Vigh of Paradigm made a presentation to the GSH data processing group Wednesday evening. He presented the Quiriquire case history that is published in this month's Leading Edge, but reworked the material to emphasize Paradigm's processing workflow. He particularly highlighted the use of ray trace migration (using a solid model) and 3D tomography.
The meeting was held at PGS, and there were about 50 people in attendance. The talk was extremely well received -- a lot of people in the audience grabbed notebooks during the talk to copy Paradigm's workflow. <grin>
After the talk, there were several questions about the application of statics prior to the prestack time and prestack depth migrations. (This is a really tricky topic.)
Hua-wei Zhou of UH gave the meeting's second presentation. Hua-wei had an example of using tomography on a global scale, or at least a tectonic scale: he had upper mantle seismic coverage of the Tibetan plateau. To keep his talk relevant to the audience, he emphasized his particular methodology - multi-scale tomography. And he mentioned that last summer he did some work on this topic with Paradigm's Dan Kosloff.
On an unrelated note, Hua-wei is a candidate for GSH First Vice President in next month's election.
"The papers note that while many of the Bush plan's details can be realized by his executive order, many others must be approved by Congress, and the coverage consensus is that at best, this is no sure thing."
Ron Swenson sent me a link to the full report of the National Energy Policy Development Group (i.e., the Cheney report).
Ron is Webmaster at the site of The Coming Global Energy Crisis. I looked at a couple of pages on the site and quickly reached information overload. I'll have to spend more time there when I'm not, you know, working.
With the big energy policy debate going on, it's all politics --
Jimmy Carter: Misinformation and Scare Tactics.
"No energy crisis exists now that equates in any way with those we faced in 1973 and 1979. World supplies are adequate and reasonably stable, price fluctuations are cyclical, reserves are plentiful, and automobiles aren't waiting in line at service stations. Exaggerated claims seem designed to promote some long-frustrated ambitions of the oil industry at the expense of environmental quality."
"The report also urges the revision or reinterpretation of a major clause of the Clean Air Act that requires long government review of any modifications of power plants that affect their emissions.... The Justice Department will also be ordered to review several multi- million-dollar lawsuits brought by the Clinton administration against utilities accused of ignoring the law." ...
"David G. Hawkins, senior lawyer for the Natural Resources Defense Council, ... said he was `astounded' that the policy would recommend a review of legal actions now under way on utility emissions, calling it `political interference with law enforcement.'"
WSJ (subscription): Bush's Energy Plan Attempts to Balance Easing of Regulations With Fuel Efficiency.
"While utilities and oil companies could benefit from the Bush plan, auto makers may be losers if fuel-efficiency standards ultimately are raised. They have lobbied hard to stop such moves, which could chill the production of hot-selling sports-utility vehicles, and the standards were never raised during the Clinton administration."
Oil & Gas Journal: White House, Congress fire opening shots in energy debate.
WSJ (subscription): U.S.'s Demand for More Energy Leads Gas Drillers Into People's Backyards.
"Mr. Mitchell, 47 years old and no relation to Mitchell Energy's founder, knocks on doors to inform landowners their property is slated for a well.... `I've had women just break down and bawl and squawl when I go down to settle with them,' he says. `My skin, if you cut into me right now, is about this thick,' he says, indicating with a thumb and forefinger the thickness of one of the sirloins served at the nearby Ponder Steakhouse."
Paradigm Geophysical Closes on Sysdrill Acquisition. Paradigm Moves into Drilling Engineering Software Solutions and Services Market.
"Paradigm's existing interpretation and well-log analysis solutions will be enhanced with Sysdrill's directional drilling software, enabling Paradigm to provide its customers with sophisticated offerings in the key areas of well bore placement, visualization and geological modeling while drilling. The first of these new products is expected to be available by the end of this year."
Houston Chronicle: Businesses ask for block on smog plan.
"A group of major industrial companies, including Exxon Mobil, Reliant Energy and Shell, is asking a judge to block the state's smog plan for Houston.... In place of the smog plan's 90 percent mandate, the group wants a plan that requires an 80 percent cut, averaged across all industrial plants, plus rules requiring companies to prevent unplanned VOC releases."
Houston Chronicle: This oil boom is a different animal.
"Oil service companies say that industry consolidation among big oil companies has also been a drag on their business. While the merged companies tried to sort out the problems of combining, they had scant attention or money to devote to looking for new oil and gas."
Associated Press: Democrats to Release Energy Plan.
"The plan also includes proposed tax credits of up to $4,000 for the purchase of energy-efficient homes and cars and additional tax incentives for businesses to invest in energy-efficient technologies or vehicles."
Oil & Gas Journal: White House discloses conservation proposals from energy plan.
"The White House said hybrid (gasoline/electric) or fuel cell vehicles are more fuel-efficient than standard autos, potentially doubling vehicle mileage.... It said the energy policy will recommend Congress provide an individual, temporary, income tax credit for purchase of new hybrid or fuel cell vehicles between 2002 and 2007."
WSJ (subscription): Auto Makers Juggle Substance, Style To Do Their Part for the Environment.
"... Ford Motor Co., in a report issued earlier this month, volunteered the estimate that its plants and vehicles alone emit the equivalent of 1.7% of the world's carbon-dioxide emissions. The world's No. 2 auto maker declared that it has dropped its long-held skepticism about global warming and has come to believe the trend is `real.'"
> The Wall Street Journal, tellin' it like it is --
WSJ (subscription): Shock at the Wheel: Wonder Why Gas Prices Suddenly Got So High?
"If you're wondering why gasoline prices have soared so rapidly in recent years, look no further than the sport-utility vehicle across the street. The spread of gas-guzzling vehicles and a still strong economy combined to drive demand faster than suppliers could match." ...
"Sport-utility vehicles, pickups and minivans make up 43% of vehicles on the road today, up from 30% in 1990, a trend that is dragging down overall fuel efficiency. As a result, gasoline demand has risen about 2% so far this year and currently stands at a strong 8.6 million barrels a day."
WSJ (subscription): Petrobras's Net Profit Slipped 1.7% In 1st Quarter on Drop in Oil Prices.
"Last week, the oil group said it would include a loss of $70 million, owing to the sinking of P-36, in its first-quarter results."
WSJ (subscription): Texaco to Pay Bijur Nearly $8 Million As Part of Agreement for Resignation.
Oil Online: TGS-NOPEC logs busy quarter.
> TGS is apparently a seismic contractor that contracts out the acquisition to other seismic contractors. This seems like a real smart way to cash in when things are good without having the exposure of maintaining ships and capital equipment.
Oil & Gas Journal: Kerr-McGee to buy HS Resources for $2.15 billion.
> Two more stories on energy policy --
New York Times: U.S. Scientists See Big Power Savings From Conservation.
"A lengthy and detailed report based on three years of work by five national laboratories said that a government-led efficiency program emphasizing research and incentives to adopt new technologies could reduce the growth in electricity demand by 20 percent to 47 percent. That would be the equivalent of between 265 and 610 big 300-megawatt power plants, a steep reduction from the 1,300 new plants that the administration predicts will be needed."
Slate: Frame Game: The Energy Crisis.
"By packaging their oil drilling plans and relaxed air pollution standards together with rising gas prices, winter heating costs, and summer blackouts in various regions of the country, Bush and Cheney have built an issue that is stronger than the sum of its parts. While the elements are indisputable, the notion that they ought to be viewed as a system, with Bush's proposals seen as an integrated solution to an integrated problem, is in part a product of public relations."
Oil & Gas Journal: IEA cuts world oil demand forecasts for sixth month in a row.
"... higher oil prices and the slowdown in Western economies [will] cap demand growth at just over 1 million b/d this year. Demand is expected to climb to a little more than 76.5 million b/d this year, 160,000 bbl short of last month's prediction, the Paris-based agency said its latest monthly oil report."
Houston Chronicle: Energy task force addresses gasoline, renewable power.
"Both nuclear and coal, which together account for nearly three-fourths of the electricity produced, are essential to meet future energy needs, the task force will declare. While urging expanded development of natural gas, the report will warn against relying too heavily on a single energy source, including natural gas."
Wall Street Journal (subscription): New Energy Policy Can't Do Much To Reduce Likelihood of Recession.
"Lawrence Lindsey, President Bush's chief economic adviser, said high energy costs probably have set back gross domestic product, or the total amount of goods and services produced in the nation, by 1% in the past year."
I link to subscription-only sites like WSJ pretty frequently. If you want to read more, but you don't want to pay for it, you might be able to find another article on the same subject at Yahoo. The Yahoo headlines page carries articles from from Reuters and AP, and the search engine is pretty good.
Reuters News Service: New Pemex head finds barrels of problems.
"Thanks to vast pools of oil and gas and a strategic location on the U.S. southern border, Mexico has long been a key player on the global energy stage. It currently ranks as the world's No. 7 producer and one of the United States' top three foreign crude suppliers."
> The Oil & Gas Journal subscription edition did a special issue on Mexico this week.
Oil & Gas Journal: ExxonMobil asks FTC to investigate Unocal's gasoline patents.
"`We contend Unocal gained a monopoly over a legally mandated product, and there are antitrust issues,' ExxonMobil spokeswoman Lauren Kerr said."
Oil Online: Landmark Graphics acquires ILEX Technologies.
"ILEX is a leading provider of Web-based data management solutions for the oil and gas industry ..."
Wall Street Journal (subscription): Utilities May Be Greener Than Bush.
"A government-set limit on CO2 emissions is unavoidable, no matter what Mr. Cheney's druthers. The issue is how to structure it without crippling the vital business of generating electricity."
CNN interviewed Dick Cheney:
> I understand where Cheney is coming from, and I even agree with maybe half of what he's saying. But I think his "persona" is going to generate a lot of divisiveness.
Back on April 27 I attended a lunch talk at UH by Bill Trojan, head of the new worldwide deep-water exploration division that Phillips is creating here in Houston. It was primarily a recruitment pep talk for students, which I didn't realize until I was there. The message of the talk was, Phillips is a big high-tech company, and it cares about the environment.
Considering his position as head of deep-water exploration, Mr. Trojan spent a surprising amount of his presentation discussing Phillips operations in Alaska. Since its acquisition of Arco Alaska, Phillips has been the largest producer on the North Slope. However, Mr. Trojan pointedly avoided taking a position on ANWR drilling: "At this point, Phillips is taking a wait-and-see approach."
In fact, the Alaska portion of the talk was entirely focused on Phillips' efforts to protect the North Slope tundra and minimize impact on wildlife.
Oil & Gas Journal: Phillips CEO expects rising demand for oil and gas.
"... but the industry faces the challenge of sustaining fossil fuels as the fuels of choice, Phillips CEO Jim Mulva told shareholders Monday. High oil and gas prices along with environmental concerns have prompted some questions about the future desirability of oil and gas, Mulva said, adding he considers this to be the biggest challenge the industry faces."
Oil and Gas Online: Schlumberger Oil & Gas Information Solutions group launched.
"... delivering solutions to enable real-time reservoir management and business optimization across the exploration and production (E&P) information spectrum. `Our new organization leverages the competencies essential to the successful iTransformation of the oil and gas industry by bringing together the information-centric ... [bla bla bla].'"
Oil & Gas Journal: Williams to buy Barrett Resources for $2.8 billion, topping Shell's bid.
"Shell Oil Co. had made a $2 billion hostile bid for Barrett. Barrett put itself on the auction block after Shell announced its offer in March."
"A number of gasoline producers have said they either eliminated or reduced their reformulated gasoline production for fear of litigation, adding to tightness in U.S. supplies and threatening a repeat of last summer's record prices. The potential shortages and price spikes are likely to be more acute in those smoggy and urban areas where cleaner-burning reformulated fuel is required. The fuel is mandated in about a third of the nation's gasoline markets."
Oil & Gas Journal: Kazakhstan confirmation well proves 10 billion bbl field.
Oil & Gas Journal: Deep water, gas, and `digitalization' emphasized at OTC.
Oil & Gas Journal: MMS official predicts surge in Gulf of Mexico oil production.
"... Oynes gave a broad summary that depicted the gulf as one of the world's busiest exploration and development areas where operators drilled 1,364 wells in 2000.... Operators are producing oil from 37 deepwater fields now compared with only 11 in 1995...."
Oil & Gas Journal: OTC panel says technology challenges require broader input.
Houston Chronicle: Mitchell will sell 4.5 million shares.
"George Mitchell, chairman of Mitchell Energy & Development Corp., plans to sell 4.5 million shares of his majority stake in the company's common stock at $53 per share.... After the sale, he will own 23.2 million shares, or about 46 percent."
Oil & Gas Journal: Employee recruitment, retention crucial, companies tell OTC.
> But if the price of oil goes down again, we'll fire you all.
About the Magic Earth buyout, Don Dean of Veritas comments:
"They got 100 million and have less than 25 employees. I just checked out Paradigm's market capitalization, and it is around 80 million and they have 375 employees. Where's the justice?"
I have to admit, it is pretty galling. Paradigm's VoxelGeo product invented the seismic visualization category years ago, and is still number one in the market. And that's just one Paradigm product, although a very important one. Paradigm now has a nearly complete line of geophysical software solutions, and nearly every one touts some interoperability with VoxelGeo. How could the whole company be worth less than Magic Earth?
> One interpretation is that the average net value of Paradigm employees not working on VoxelGeo is negative $60,000.
> Another interpretation is that Magic Earth's $100 million valuation is a function of hype. Again, though, this is not so much a knock against Mike Zeitland as against Paradigm's marketing.
I think the most important factor is that Halliburton is not buying Magic Earth solely, or maybe even primarily, as a Landmark software product. I've heard speculation that they are going to build demonstration centers in their offices around the world, with cave-like features including real-time visualization of the down-the-borehole environment during drilling.
For Halliburton, Magic Earth is not just glitzy interpretation software. It's also a glitzy high-tech add-on to their oil-field service work. Which is where the real money is.
BTW, Paradigm's current employee count is closer to 500.
WSJ (subscription): Ford to Acknowledge Severity Of Global Warming in Report.
"Tuesday, five U.S. senators, including Democrats and Republicans, joined to introduce a bill that would require sport-utility vehicles, pickup trucks and minivans -- the so-called light trucks that account for about half the U.S. auto market -- to meet the same fuel-economy targets as cars by 2007."
The New York Times does a comprehensive piece on the Cheney talk --
NYT (free registration required): Cheney Promotes Increasing Supply as Energy Policy.
"Mr. Cheney said today that environmentalists had taken things too far. He said a recent television advertisement showing a child asking for more arsenic in her water was a `cheap shot.'" ...
"In a report to be released later this week, the American Council for an Energy-Efficient Economy estimates that raising the fuel efficiency of cars and light trucks [and SUV's!] by what it calls a modest amount could do far more to reduce reliance on imported oil than drilling for oil in the Arctic National Wildlife Refuge."
Houston Chronicle: Halliburton to purchase 3-D visualization company.
"Halliburton has agreed to pay $100 million in stock for Magic Earth, a Houston-based 3-D visualization and data interpretation company that was formed slightly more than a year ago.... Revenues of the closely held company were not disclosed.... [Michael] Zeitland will remain president and chief executive officer."
> Mike Zeitland seems like a really nice guy, but I must admit I'm turning green.
> I first met Mike about eight years ago, through mutual friends. They were computer geeks, and he gave us a tour of the Texaco facilities. I've seen him at meetings a few times since then; he doesn't remember how he knows me, but it's stuck in his head that I'm a graphics programmer. He even asked me once if I was looking for a job.
> Maybe I should have taken up graphics programming.
WSJ (subscription): Canadian Oil-and-Gas Producers Challenge U.S. Multinational Rivals.
"For decades, Canadian units of Exxon Mobil Corp., Royal Dutch/Shell
Group, BP Amoco PLC and other foreign giants pumped most of
Canada's oil and gas. But last year, Alberta Energy Co., based right
here, became Canada's top natural-gas producer, and another Calgary
independent, Talisman Energy Inc., overtook Exxon's Imperial Oil Co. to
become the nation's biggest combined oil and gas producer."
"During periods of rock-bottom energy prices, the companies accumulated out-of-fashion Canadian oil and gas assets that the multinational concerns were shedding. Enjoying stronger balance sheets than most of their Canadian and U.S. rivals, these independents gobbled up competitors, branched out overseas and invested in exploration programs to profit when energy prices recovered." ...
"... the top Canadian-owned oil and gas companies are broadly matching the world-wide revenues and production of some big independent U.S. oil and gas producers that lately have been buying Canadian assets, such as Amerada Hess Corp., Apache Corp., Burlington Resources Inc., Devon Energy Corp. and closely held Hunt Oil Co."