Friday, December 31, 2010

It's a Rare Earth

A slurry of rare earth stories as major newspapers report on China tightening its exports of rare earth minerals. In Australia this was generally reported with reference to the share price of Australian mining companies. I've inter-cut sections from the following two related stories by Barry Fitzgerald.
Australian rare earth stocks on the rise
SMH, 30th December
Glittering earthly treasures
The Age, 30th December
AUSTRALIA'S emerging rare earths producers and explorers are enjoying a year-end surge in value thanks to China's latest move to limit supplies from its dominant industry to the rest of the world.

China's announcement that it is cutting the export quota for rare earths by 35 per cent in the first half of next year renewed expectations that drastic price increases could be ahead for the subset of 16 metallic elements that have growing high-tech applications.
New mine developments in Australia are seen as critical to breaking China's grip on supplies. As a result, ASX-listed developers were chased by investors yesterday. Lynas Corp surged 10.8 per cent or 17.5¢ to $1.795 and Arafura climbed 13.5¢ to $1.355.

According to the US Geological Survey, rare earths are relatively common in the earth's crust.

But their concentrations are often too low to make extraction economically viable.
The world has nevertheless grown nervous about China's dominance of supply, particularly following Beijing's recent directive to suspend/delay shipments to Japan in an extension of their territorial dispute in the South China Sea.

Japan brought its fears to Canberra last month, prompting the Foreign Minister, Kevin Rudd, to say that Australia "understands the significance of rare earths globally".
It was shortly after the trade visit that a deal was unveiled under which $US250 million in Japanese government agency financing will be made available for an accelerated expansion of Lynas's Mount Weld rare earths project near Laverton, in Western Australia, and the project's associated processing facilities in Malaysia.
It was the Rudd government that blocked a proposal last year for China Non-Ferrous Metal Mining Company to acquire a 51.6 per cent interest in Lynas for what can now be seen as the knockdown price of $252 million.
At yesterday's closing price, Lynas was a $2.9 billion company.

Wednesday, December 29, 2010

Nearest Neighbor News

In Indonesia fuels (petrol, diesel, gas) are subsidized. The logic behind some of these subsidies is understandable; to assist the poor.

Subsidized LPG
As part of the Indonesian drive to phase out kerosene stoves, promoted as a safety measure to prevent fires1, 3 and 12 kg bottles of gas were subsidized. The Government anticipated that restaurants would not choose to use large numbers of these smaller bottles. However, most warung (restaurants)  opted to use the 12 kg bottles. The Government then removed the subsidy from these bottles so that only the small 3 kg bottles were subsidized for the poor. The result was nearly inevitable.

Unlike in Australia (and I suspect New Zealand) the fitting used in Indonesia is a quick-fit and release arrangement, not your ‘standard’ brass gas fitting. Moving large numbers of these small bottles in a “swap and go” system to satisfy the demand increased wear and tear, and lowered inspection standards (if they existed). Now instead of moving a lesser number of the more heavy duty bottles, truck loads of small bottles stacked 10 high became a common sight. Even so, I estimate that to carry the same amount of fuel around, nearly twice as much metal (by weight) is needed – thus the overall “efficiency” is probably decreased. The fires caused from damaged bottles and bad fittings injured hundreds around the country.
Suspected LPG gas explosion injures three
Study reveals more than 200 LPG explosions in three years
Pertamina needs Rp 1.7t to replace uncertified LPG canisters
Govt blames market for exploding canisters
Letter: LPG explosions
There were also some suggestions that resellers were refilling the larger 12 kg bottles with the smaller bottles to take advantage of the price disparity due to the subsidy!

Subsidized Petrol
While the same logic (i.e. helping the poor) is the rationale behind this subsidy it is more a populist measure the country can no longer afford.  The supporters of these subsidies claim that it enables poor people to access transport, the ubiquitous motor (scooter).  However, as the Indonesian economy has grown, scooters have given way to (frequently large) cars that are consuming Indonesia's dwindled supplies ever rapidly.  Government officials are aware that this situation can not last long, but the Yudhoyono Government can not move quickly on this out of fear of the electorate. Critics of the subsidies point out that those rich enough to afford large cars benefit most from this scheme.

Monday, December 27, 2010

The News on coal

In light of the recent news about the sell off of NexGen and the curtailing of funding for 'Carbon Capture and Sequestration' (CCS) News Limited continues to pump out coal stories. From the business section...
Coal to remain backbone of power generation
Geoff Hiscock, Dec 22nd.

Despite rapid growth in renewable power sources such as hydro, wind and solar, coal will remain the backbone of electricity generation for the next 25 years, according to the International Energy Agency (IEA).

A drop in coal-fired power generation in the advanced economies of the OECD between now and 2035 will be offset by big increases elsewhere, especially in China, where 600 gigawatts (GW) of new coal-fired capacity will be added. That figure exceeds the current capacity of the United States, Europe and Japan, the IEA says in its latest World Energy Outlook.

The IEA’s projections underpin the growing push by China and India to secure long-term coal supplies from around the world. As part of that drive, Chinese and Indian private and state-owned corporations are seeking to invest in Australian coal projects.

The world’s largest coal producer, Coal India Ltd, is also on the hunt for Australian mines, with Peabody Energy’s Wilkie Creek mine in Queensland a possible investment. CIL is held 90 per cent by the Indian government.

Late last year, China’s Yanzhou Coal Mining agreed to pay $3.5 billion for Felix Resources, which produces thermal and coking coal from four sites in New South Wales and Queensland.
Yes, that IEA... does that mean if the IEA made a lower projection then China and India wouldn't 'push'?

Given that Felix means 'happy', it might be a good strategy for smaller miners to rename themselves to something including the words 'dragon', 'lucky' or the number 8.
Meanwhile, over at the Courier Mail we have;
Anna Bligh culls coal to fund solar
Patrick Lion, Dec 25th.
ANNA Bligh has secretly stripped $100 million from her highly touted clean-coal fund to bankroll a new solar push while publicly claiming she was still committed to cleaning up the state's coal industry.

The Sunday Mail has learnt the Premier recently redirected one-third of the clean coal allocation in the Queensland Future Growth Fund towards the development of two new commercial-scale solar power projects.

The move, a significant shift in Labor's energy policy, emerged one week after revelations the Government would walk away from state-owned clean coal company ZeroGen and scrap its planned $4.3 billion power plant in central Queensland.

In a statement, Ms Bligh yesterday confirmed the re-direction from the clean coal fund to the Solar Flagships Projects, saying it would help develop two new solar plants that power over 50,000 homes.

Defending the ZeroGen decision last weekend, Ms Bligh said she was still committed to clean coal and would "keep $50 million" in the clean coal fund.
But The Australian, in an 'exclusive' no less, paints Anna Bligh as a nuclear advocate;
Anna Bligh opens door to nuclear power
EXCLUSIVE: Jamie Walker and Imre Salusinszky

ANNA Bligh has backed calls for the Labor Party to review its policy on nuclear power.

The Queensland Premier has warned that renewable sources cannot meet the surging demand for baseload electricity.

Ms Bligh and ALP national president said development of the only other viable alternative energy, hydro-electricity, had been hamstrung by resistance to new dams.

Ms Bligh said pointedly that "parts of the environment movement" had shifted on the nuclear option, and now supported it as an abatement measure for climate change.

Ms Bligh said other renewable energy sources, such as wind and solar, could not produce sufficient baseload power. "I think it is perfectly understandable why nuclear comes on to the agenda . . . as people are genuinely looking for what is a cleaner alternative," she told The Australian.

"And I think it is quite interesting that's now coming as much from some parts -- not all, but some parts -- of the environmental movement, as it is from other parts of the energy sector..

However, Ms Bligh cautioned that any discussion about nuclear power for Australia remained theoretical, and not just because the cost was "prohibitive".

"I think there are still very genuinely held concerns about safety, and in an environment . . . where we have other alternatives then I think the prospect of one (a nuclear power plant) in an Australian context in the near future is very slim."

"It's not something on my agenda for the next election . . . it's the sort of thing, frankly, I don't have any intention of revisiting."
Jamie and Imre must use a different dictionary to me, they (or their editor) seem to have interpreted Ms Blighs peek through the door in a very exclusive manner. However, notice that peoples concerns are not genuine, just genuinely held.

Saturday, December 25, 2010

Peek under the tree

The US National Academies of Sciences has many interesting reports and books (many free for download) on a variety Energy and Sustainability topics. Here are some examples;

The journal Proceedings of the National Academies of Sciences1 also provides a section on Sustainability Science with some freely available content, for example;
Public perceptions of energy consumption and savings
In a national online survey, 505 participants reported their perceptions of energy consumption and savings for a variety of household, transportation, and recycling activities. When asked for the most effective strategy they could implement to conserve energy, most participants mentioned curtailment (e.g., turning off lights, driving less) rather than efficiency improvements (e.g., installing more efficient light bulbs and appliances), in contrast to experts’ recommendations. For a sample of 15 activities, participants underestimated energy use and savings by a factor of 2.8 on average, with small overestimates for low-energy activities and large underestimates for high-energy activities. Additional estimation and ranking tasks also yielded relatively flat functions for perceived energy use and savings. Across several tasks, participants with higher numeracy scores and stronger proenvironmental attitudes had more accurate perceptions. The serious deficiencies highlighted by these results suggest that well-designed efforts to improve the public's understanding of energy use and savings could pay large dividends.

I wanted to find a rich vein of information like this with more local content, but hey... Merry Xmas.

1. There have been some questions about the article submission and reviewing procedures of this journal. Members can sometimes get a "free kick".

Friday, December 24, 2010

Coldry - Comfortable Coal?

From the title of the following article you would assume that there was some ground breaking news to follow... but then the headline doesn't say what this technology would be cheaper than.  Interesting that this article appeared so soon after the bad news from Queensland (Carbonuncle - below).
Cleaner brown coal said to be cheaper emissions reducer
Mathew Murhpy, SMH, Dec 22.
A MELBOURNE-BASED company has claimed that a cleaner version of brown coal could cut Victoria's greenhouse gas emissions at less cost than a combination of wind energy and fossil fuels. Environmental Clean Technologies uses a patented process that alters the chemical composition of brown coal - a high emitter of greenhouse gases when burnt - into a pellet form of black coal, a cleaner alternative. Chief executive Kos Galtos said the Coldry technology could meet Victoria's 20 per cent emissions reduction target, or 13 million tonnes of greenhouse gas, at lower cost than hybrid generation such as wind and gas or wind and brown coal.
"Could" as in may be possible in the future. The ECT website is at least upfront about the environmental impact of coal.
Some may dismiss any attempt to label any form of fossil fuel as ‘Green’.
We agree! There is no such thing as clean coal.
However there is ‘cleaner’ coal. So what is the basis for understanding the ‘Green’ credentials of Coldry?  It comes down to two simple concepts:
  • Net Energy Footprint
  • Net Carbon Footprint
The net energy footprint of a lignite drying technology must be positive, while its net carbon footprint (including end use) must be negative. Coldry is not a zero emission solution. It is a transitional solution that mitigates emissions now. The reality is, even with best efforts, society will use coal for a while to come, until cleaner energy alternatives are developed to a level affordable to average citizens
The process has passed the pilot scale and the company plans to build larger scale units which according to the website will process:
  • 167,000 TPA of Coldry from 60% moisture coals,
  • 220,000 TPA of Coldry from 50% moisture coals,
  • or 300,000 TPA of Coldry from 40% moisture coals.
If the units above (TPA) mean tonnes per annum then surely this is a long way from producing the stated reductions claimed above?

To put this in perspective the Loy Yang Power Station has an 18 hour reserve coal bunker of 70,000 tonnes and 30 million tonnes are extracted from the pit every year. So 300,000 tonnes (from 1 Coldry unit) is about 1% of the production from the Loy yang Pit.

The ECT Website claims that the process is;
Immediately deployable in existing brown coal boilers (10% to 20% of total energy mix), Decreasing coal requirements (7% to 14%), Reducing emissions (6% to 11%) and Reducing ash accumulation (2% to 4%)
Which I think means that ~20 of these units are needed for Loy Yang.

For more on Brown Coal try:
Advances in the Science of Victorian Brown Coal
The Science of Victorian brown coal: structure, properties, and consequences for utilization

Monday, December 20, 2010


"A carbuncle is an abscess larger than a boil, usually with one or more openings draining pus onto the skin."
A carbonuncle might be the future term used if injecting large quantities of CO2 into the ground has an unfortunate end result.

The Carbon Capture and Storage (CCS) project in Australia took a significant step backwards as Queensland Premier Anna Bligh announced that Queensland would not be providing further funding for ZeroGen to build what was supposed to be a landmark demonstration power station and that the state owned ZeroGen is to be sold.
Bligh denies clean coal 'bungle'
Brisbane Time, Dec 19th.
Queensland Premier Anna Bligh has denied walking away from the development of clean coal technology, after abandoning plans to build a central Queensland plant by 2015. The Queensland government had ploughed $102 million into the ZeroGen research project, which also attracted $92 million from the federal government and the coal industry. It had aimed to have a $4.3 billion coal-fired power station utilising carbon capture and storage technology – which would prevent greenhouse gas emissions from entering the atmosphere – built by 2015.
But the state government today confirmed it would not pursue a proposal to fund the proposed power station “at this time” because of concerns about its viability. It also plans to offload the state government-owned ZeroGen company, turning it into an independent entity owned and run by the coal industry.
"Reports this morning that the Queensland Government has scrapped our clean coal project ZeroGen or that it has been a waste of money are utterly wrong in every respect,” Ms Bligh told reporters in Brisbane.
“What we know now from the early research is that a fully functional power station by 2015 using this technology is technically possible but it is not economically viable.”
Ms Bligh said the technology “would drive up the cost of electricity beyond the reach of normal people” if proceeded with now.
The proposed plant had been expected to cost $4.3 billion.
“The Queensland Government cannot have its cake and eat it to, profiting from exports while being unwilling to invest in the [research and development] necessary to reduce emissions”, [said Federal Resources and Energy Minister Martin Ferguson].
Mr Bligh said she had spoken to Mr Ferguson this morning to explain what was happening with the ZeroGen project.  “I think he understands like I do that the great discoveries of the world have had disappointments along the way,” she said.

Saturday, December 18, 2010

A leg-up for solar energy storage

Energy storage technology company Graphite Energy (discussed at this TOD ANZ post back in 2008) featured in a recent dispatch from The Climate Spectator, noting they have received a research grant from the Australian Solar Institute - A leg-up for solar.
Graphite Energy and CSG Solar have been named among successful bidders for 14 solar research and development grants awarded by the Australian Solar Institute, worth a total $21.6 million, in a move it says will help Australia develop more efficient and cost-competitive solar technologies.

“Each of the selected projects offers the potential to advance solar technologies in a way which will increase their commercial competitiveness with other energy sources,” AIS chair Jenny Goddard said. The University of New South Wales, the Australian National University, the University of Sydney, the University of Melbourne and CSIRO (Newcastle) also won tenders for the grants, with another 25 domestic and international organisations involved across range of consortia, the institute said.

How high's the water Papa?

OzCoasts is a new Federal Government site with some simple and heavily qualified projections of the possible effects of increased sea levels at several locations around Australia.
The maps have been prepared by combining a sea level rise value with a high tide value. They illustrate an event that could be expected to occur at least once a year, but possibly more frequently, around the year 2100.
Maps are available to show three sea level rise scenarios: low sea level rise (0.5m), medium sea level rise (0.8m) and high sea level rise (1.1m). These sea level rise scenarios are for a 2100 period, relative to 1990. The sea level rise values are based on IPCC projections (B1 and A1FI scenarios) and more recent science.
Before you view each high resolution image you are required to agree to a disclaimer that states in part:
These images have been developed to help communicate the risks of sea-level rise.
The images are not provided as professional advice, and should not be relied upon for site-specific decision-making or for making financial or any other commitments.
The images use a 'bucket fill' method to determine the extent of inundation and should be considered as approximate only.
The actual impacts may vary as this model does not take account of existing sea walls, storm surge, erosion or other local factors.
The model does not include the dynamic response of unconsolidated shorelines (eg. sand, mud and shell) or the increase in tidal flows in coastal waterways that will result from different coastal configurations in some locations. Nor does the model take account of the effects of catchment flooding from coincident extreme rainfall events.
Despite the heavy qualification of the data, Gold Coast Councillor Peter Young was adament that the Federal Government's data was flawed.

Thursday, December 16, 2010

The absence of a positive vision

The ABC site The Drum Unleashed has a contribution from Leigh Ewbank, Director of Public Policy at Beyond Zero Emissions. The article does seem a bit of a PR piece for his organization, but at least readers are told that upfront... unlike many of the aggressive posters at the end of the article who sound like one voice. I have never thought it a constructive tactic to win over someone using words like 'incompetent', 'full of dribble', 'stoned tree-hugging hippies','eco-stalinists' etc.
Doom discourse a barrier to climate action
Leigh Ewbank
While it’s important for the public to be aware of the risks of runaway climate change, focusing narrowly on threats and evoking apocalyptic rhetoric, as Melbourne writer Doug Hendrie did yesterday, is not helpful. It might be good for scaring the general public senseless, but does not create the conditions needed to deliver action on climate change. For that we need a positive vision of our future.

The effect of Hendrie’s apocalyptic rhetoric is to disempower the community, encourage scepticism, and relegate climate change to the too-hard basket. Recent research published by the University of California Berkeley supports this assessment: “Dire messages warning of the severity of global warming and its presumed dangers can backfire, paradoxically increasing skepticism about global warming by contradicting individuals’ deeply-held beliefs that the world is fundamentally just” (PDF).

Monday, December 13, 2010

Breaking oil's grip

Matthew Wright from Beyond Zero Emissions (authors of the 'Zero Carbon Australia' Plan) has an article in The Climate Spectator talking about the importance of eliminating Australia's dependency on oil (especially in the context of Richard Branson's recent prediction of $200 per barrel oil) - Breaking oil's grip.
A $US200 per barrel oil price by mid-decade is consistent with Beyond Zero Emissions’ internal analysis and will have massive economic consequences for Australia. The issue presents us with an opportunity to achieve multiple outcomes: reduce our impact on the climate, while increasing our economic competitiveness and energy security. We can sandbag our economy from punishing oil prices, but only by equipping our automotive sector for the 21st century and utilising modern electric rail in upgraded national transport and freight networks.

The Australian economy will be importing 80 per cent of its oil by 2015, which means we will be forking out as much as $66 billion for imported oil per year from 2015 (based on Australian Petroleum Production and Exploration Association figures combined with BZE and Branson oil price predictions for 2015). Although this huge figure is equivalent to a quarter of the Australian federal budget, federal and state energy ministers refuse to acknowledge it, despite several years of trying to bring these facts to their attention. It is a significant economic vulnerability that will only grow in the decade ahead.

The increased cost of imported oil on the horizon is akin to a 'great big tax' on Australian families and already stressed industries. But unlike government taxes that pay for new schools, hospitals, train lines and other critical infrastructure and services, this multi-billion dollar price hike will solely benefit oil-rich nations. Instead of driving the Australian economy into a $66 billion brick wall, we need to get on the front foot and retool the economy for the safety and security of Australian families and industry.

Our government must push domestic car factories to retool for pure electric and plug-in hybrid vehicles. This is the case for leading US car maker GM. The company has successfully retooled its Michigan factories to mass-produce the Chevy Volt at the affordable $41,000 per car (in line with what average cars cost in Australia). There is no reason why Australia can’t do what Michigan-based automakers have done.

Given the rapidly rising demand for electric vehicles, reorienting the automotive industry is a strategic economic move. GE just announced it will aim for 25,000 electronic vehicles (EVs) in its global fleet by 2015. Anticipating increased demand, the European car-giant Renault will aim to produce 500,000 pure EVs per year by 2013. Even with ramped-up production though, EVs are expected to be in short supply globally over the next three to five years.

So what can the Gillard government do to encourage the automotive sector restructuring? There are several options.

Sunday, December 12, 2010

David Suzuki: an elder’s vision

NZ publication "Pundit" has an article by Claire Brown on a recent speaking tour of Australia and New Zealand by David Suzuki - David Suzuki: an elder’s vision.
David Suzuki says by ignoring warnings of over-consumption and its dire consequences, we are following 99.9999% of our fellow animal species to extinction; and the Greens convene a cross-party economic conference, populated mostly by Greens

David Suzuki chuckles, remembering a sign he saw on a shop door (“no animals allowed”) and parents’ reaction when he told their children that’s what they are: just animals. “Boy, were they pissed off … we don’t like to be told that,” he comments dryly. He told the shop owner, too, who didn’t get the joke.

Asked to speak to the working title ‘a sustainable economy for the world’, he says he’s a scientist, not an economist — and, more crucially, what he terms an ‘elder’. So instead, he talks about what we need, not want, to hear, which was animals: frogs, and ostriches, and us — the naked ape.

The Best Of TOD ANZ

The Oil Drum recently published a "Best Of" list of posts - these are the best from TOD ANZ writers :

Big Gav

Concentrating On The Important Things - Solar Thermal Power
While we spend a lot of time talking about traditional energy sources based on depleting resources that are extracted from the ground, I think its important to remember that the fastest growing sources of energy are solar and wind, and that these will never run out.

Tapping The Source: The Power Of The Oceans
A post examining the use of artificial islands to collect wind, wave, ocean current and solar power in the tropics, along with a more unusual energy source - harnessing the difference in water temperatures between the warm surface and the cold depths using a technique called OTEC (Ocean Thermal Energy Conversion).

Geothermal Energy: Geothermia
Crossposted from my blog Peak Energy as the subject of geothermal power has cropped up in the comments a few times lately.

Floating Offshore Wind Power
An update on a post I did last year on the potential for floating offshore wind power, which looked at a number of different prototypes at various stages of development.

The Limits To Scenario Planning
A review of some common misconceptions about the Limits to Growth book.

Iraq's Oil: The Greatest Prize Of All
In this post I'll outline why I believe that Iraq probably has the world's largest oil reserves - or, as Daniel Yergin once said of the middle east, it is "the greatest single prize in all history".

Natural Gas In Australia - How Long Will It Last?
In this post I have a look at how much gas Australia has and how long it will last under a variety of scenarios.

Coal Seam Gas In Australia
In this post I look at recent events in the gas industry and what they mean for Australian gas production in future.

The Hydrogen Economy and Peak Platinum
A comprehensive review of the issues involved in the "hydrogen economy".

Hubbert: King Of The Technocrats
In this post I explore the Technocracy movement and Hubbert's role in it

Locabucks: Are local currencies a way to escape the liquidity trap?
I look at the concept of local currencies (or "locabucks" as I'm now dubbing them), an idea which has its roots in the Great Depression as a mechanism for escaping the liquidity trap - and thus might be relevant again in the not-too distant future if present trends continue.

Terra Preta: Biochar and the MEGO Effect
In this post I have a look at modern day techniques to produce terra preta (often called biochar or agrichar) which have the potential to increase soil fertility, generate energy and sequester carbon all at the same time.

Buckminster Fuller's Critical Path
A review of Buckminster Fuller's last work, Critical Path.

Is It Time For a 4 Day Working Week?
In this post I look at various proposals to reduce the amount of time we spend at work, as a way of addressing energy, environmental and other issues facing us.

Peak Oil And The Tea Party Movement
In this post I have a look at the boost this (peak oil) is likely to give to populist politics and some of the possibilities for addressing this.

David Clarke

The Failure of Networked Systems: The Repercussions of Systematic Risk Revisited
Cascading collapse and why the corporate drive towards increasing efficiencies could be driving our interacting networked systems towards this mode of collapse.

The Networking of Resource Production: Do the Networks Give us Warnings when They are About to Fail?
The flaw in the techno-cornucopian dream: Modeling why and how a networked resource-extraction system fails.


The Freezing Point Of Industrial Society
This piece considers that industrialisation could only happen with cheap fuels, and by looking at the countries of the world, tries to figure out just how cheap fuel has to be before lots of people start using it – before a country can industrialise with fossil fuels. The flipside to this is seeing how expensive fuel must be before it deindustrialises. This then gives us a clue to if and when will industrial society will end.

Phil Hart

Meet Trev: A two-seater renewable energy vehicle
I believe there is instead a bright future for a spectrum of 'micro' electric vehicles, from battery powered bicycles up to compact size cars, including this new concept car named Trev (Two-seater Renewable Energy Vehicle).

International Energy Agency calls 'Peak' on OECD Oil Demand
In World Energy Outlook 2009, the International Energy Agency seems to have dropped a bombshell that has been quietly (and politely) ignored.

The Economics of Volatile Oil Prices
Considering the fundamental nature of oil supply and demand provides a coherent explanation not just for the rapid rise in oil prices, but also the dramatic fall.

The 2008 IEA WEO - Oil Reserves and Resources
Despite significant changes, the 2008 IEA report still relies on inflated estimates of reserves from OPEC countries, overplays the contribution of reserves growth due to technology and predicts the reversal of a decades long trend of declining oil discoveries.

Oil, House Prices, Credit? Three parts of the same story
The long forgotten 'oil crisis' of just a few months ago has been replaced by a full blown 'credit crisis' - related events that represent the unravelling of half a century of unsustainable trends in oil consumption and debt.

High-Tech Hitchhiking
Could a hitchhiking scheme for the iPhone era work in practice and change attitudes to hitching a ride?

How Technology Increases Oil Production
How can you double something and still have ten times less than you started with? The answer to this question will help us reassess claims that advances in oil field technology will postpone the peak in global oil production.

Oil Reserves: Where Ghawar goes, the rest of OPEC follows
In May 2007, the work of Stuart Staniford and Euan Mearns culminated in a new and unprecedented assessment of oil reserves in Ghawar, the world's largest oil field. This article combines their assessment with additional information sources, to produce a revised estimate of reserves in Saudi Arabia and the other OPEC countries.

Saturday, December 11, 2010

Wind ups and downs

Two stories from The Mercury in Tasmania. The first about a proposed expansion of alternative energy generation on King Island, the second on an under performing wind farm.
Green power tested on island
The Mercury, December 09, 2010

Tasmanian Premier David Bartlett and Greens leader and Alternative Energy Minister ...launched a $45 million renewable energy project on King Island yesterday.

The $30 million election promise from the Tasmanian Government, aided by $15 million from the Commonwealth, aims for renewable sources covering two thirds of the island's energy needs by late next year, reducing the reliance on diesel generators.

The experiment will also provide Hydro Tasmania with experience that may be used in other isolated small communities around the world without access to mainstream grid power.
Every home and business on King Island, including its two dominant industries, the abattoir and the cheese factory, will have smart-grid technology that offers information and choices about best and cheapest times to use electricity.

Hydro Tasmania has also formed a joint venture with technology company CBD Energy to test a new method of long-term storage of electricity.

Mr McKim sees the island of 1600 residents as the ideal laboratory, where renewable energy ideas and technology can be commercially tested on a small scale.

"This project will secure King Island's reputation as a clean and green fine food producer, attract further investment and lower the cost of living through reduced power prices," Mr McKim said.

The proposed system will use an energy storage unit from RAPS (details on the website are lacking, other than it comes as a container sized module) and Vanadium Redox Batteries.

Wind fails to turn a profit
The Mercury, December 01, 2010

A parliamentary committee scrutinising the operations of Hydro Tasmania was told yesterday that Hydro's wind-farm business, Roaring 40s, had run at a loss for the past five years because there had not been enough wind.

Hydro Tasmania's new chief executive Roy Adair said he hoped the wind-farm subsidiary would break even this year.

But he conceded one of the major problems had been that winds at its major wind farm at Woolnorth, on Tasmania's far northwest tip been "down against expectations".

Mr Adair said early evaluation of the Woolnorth wind-farm site in 2000 had predicted wind speeds, and therefore power production, would be 8 to 14 per cent higher than had been recorded.

He said with "more realistic estimates of generation productivity", profits could now be achieved.

Liberal energy spokesman Peter Gutwein said it was not good enough that Roaring 40s had never returned a profit for its owners, the Tasmanian public, and lost nearly $13 million last financial year.

Mr Gutwein said Hydro and the Government have some serious questions to answer after revelations more wind-power generation had been forecast than had resulted, costing Tasmanian taxpayers millions of dollars.

Greens energy spokesman Kim Booth agreed that it looked like Hydro Tasmania had "got its modelling wrong" on Woolnorth.

Friday, December 10, 2010

Australian LNG Projects to Face ‘Serious Challenges’

Bloomberg reports that Moody's are bearish about Australian natural gas and coal seam gas LNG projects following the recent cost blowout at Woodside's Pluto project - Australian LNG Projects to Face ‘Serious Challenges’.
Australia’s liquefied natural gas industry faces “serious challenges” such as labor shortages that may force energy companies to delay, merge or cancel their projects, Moody’s Investors Service said.

Moody’s cited Woodside Petroleum Ltd.’s announcement on Nov. 30 that its Pluto LNG venture would cost A$900 million ($889 million) more and start about six months later than previously forecast. The increased cost “is symptomatic of Australia’s resource boom,” Saranga Ranasinghe and Ian Lewis, analysts at Moody’s, wrote in a report dated yesterday.

“While credit negative for Woodside, the cost overruns at Pluto also hold negative implications for the rest of Australia’s energy industry,” and its A$150 billion of proposed investments, the Sydney-based Moody’s analysts said. ...

“These are serious challenges,” the report said. “While we have a favorable view of the long-term LNG demand, these operating challenges will mean that some of Australia’s planned LNG projects will not proceed as currently anticipated. Whether that will lead to the merger of some projects, or to their outright cancellation, remains to be seen,” it said.

Wednesday, December 8, 2010

How green is your pet?

The Age recently  ran an article titled Pooch pie on the menu if we don't cut ecological pawprint (November 25, 2010). The source for this article appears to be an article from New Scientist published last year How green is your pet? (23 October 2009 - subscription required) which was drawn from the book Time to Eat the Dog: The real guide to sustainable living.  The main thrust of the argument is that owning a large dog is in many ways as damaging to the environment as owning a large 4WD - due to the amount of meat consumed by the pet.

From The Age article:

If the entire country went vegetarian, it would in all likelihood have a noticeable effect on our ecological footprint. At the present rate, though, it's going to come down to sacrifices - and your weekly recycling isn't going to cut it.

Serving up Fido as an entree might be a bit extreme, but one of the most effective ways you can make an impact on your ecological footprint is by not owning a dog. It's not that it never turns the lights off, or leaves the television on all night - its sole crime is the amount it eats in its lifetime (about 164 kilograms of meat and 96 kilograms of cereal a year for a medium-sized dog).

When it comes to an ecological footprint, a dog is the equivalent of two Toyota Land Cruisers, and this includes both the manufacture and use of the car.

From the New Scientist article:
Alternatively, consider the cumulative environmental impact of our furry friends. The US, which tops the list for both cat and dog ownership in absolute terms, is home to over 76 million felines and 61 million canines. Taking the estimated cat population for the top 10 cat-owning countries, the Vales calculate that the land required just to feed these cats is over 400,000 square kilometres. That’s equivalent to one-and-a-half times the area of New Zealand. A further five New Zealands are required to feed the pooches living in the top 10 dog-owning countries...
Two important points:
  1. that's a lot of New Zealands! 
  2. that's more than some estimates of the area required to provide global electricity using solar power!
[Note: I am not a vegetarian, but I do not consume large quantities of meat. ]

Tuesday, December 7, 2010

How do you deal toughly with your banker?

The title above is taken from a comment made by Hillary Clinton in an otherwise routine article from The Age derived from the Wikileaks archive.
Clinton grilled Rudd on dealing with China
The Age, December 5

US Secretary of State Hillary Clinton grilled then Prime Minister Kevin Rudd on how best to deal with the growing economic power of China, a confidential cable released by WikiLeaks states.
Ms Clinton said the US wanted "China to take more responsibility in the global economic sphere, create more of a social safety net for its people, and construct a better regulatory framework for the goods China manufactures."

"The Secretary also noted the challenges posed by China's economic rise, asking: `How do you deal toughly with your banker?'," the cable stated.
While commentary has focused on Rudds comment about using force should "things go wrong" - I don't recall ever seeing the situation about the US dollar so bluntly stated officially. It seems, all those years ago, that Robert Newman may have been on to something (@ 2:30 in video).

Posted by SP

Monday, December 6, 2010

Montara Oil Spill: "A failure of sensible oilfield practice"

While BP's deepwater spill in the Gulf of Mexico was worldwide news for months, the worst incident of its kind in Australia in August 2009 also leaked for 74 days before the well could be brought under control. Yet in Australia media interest was muted after the first few days and most people even here would have forgotten that it ever happened. Nobody seems to care if you don't have a household name like BP?

An inquiry was completed in August 2010, but the report has only now been released along with the Government's response.

Some Background

Wikipedia: The Montara oil spill was an oil and gas leak and subsequent slick that took place in the Montara oil field in the Timor Sea, off the northern coast of Western Australia. It is considered one of Australia's worst oil disasters. The slick was released following a blowout from the Montara wellhead platform on August 21, 2009, and continued leaking until November 3, 2009 (in total 74 days), when the leak was stopped by pumping mud into the well and the wellbore cemented thus "capping" the blowout.

The West Atlas rig is owned by the Norwegian-Bermudan Seadrill, and operated by PTTEP Australasia (PTTEPAA), a subsidiary of PTT Exploration and Production (PTTEP) which is in turn a subsidiary of PTT, the Thai state-owned oil and gas company was operating over on adjacent well on the Montara platform. Houston-based Halliburton was involved in cementing the well.

The Montara field is located off the Kimberley coast, 250 km (160 mi) north of Truscott airbase, and 690 km (430 mi) west of Darwin. Sixty-nine workers were safely evacuated from the West Atlas jackup drilling rig when the blowout occurred.

The Incident

Having worked in the industry, my impression was that most operators are working pretty hard to prevent accidents like this. The inquiry suggests that is not the case, with the Thai operator in this case failing to meet the most basic requirements for safe drilling:

Saturday, December 4, 2010


As part of the recent changes announced at The Oil Drum, the regional satellite sites such as TOD ANZ have been closed, bringing to an end an interesting 3 year period.

As a result, we are shifting operations from the main TOD site to a Blogger hosted environment and looking to expand the contributor base and provide a more regular stream of information than has been the case in recent months.

We'll still be accessible via the original URL ( as well as the new one ( Old content will remain available as well, with a "best of" set of links being added to the sidebar in the near future.

The initial group of contributors are :

aeldric - David Clarke has worked as a consultant analyst for almost 30 years, spending the last 15 years consulting mainly in IT. David has owned and sold an IT startup, but now prefers the pampered life of a manager in the corporate world. He has close friends in the energy industry and blames them for introducing him to Peak Oil, and bursting his happy bubble.

Big Gav - Gav studied Engineering at the University of Western Australia in Perth. Since then he has travelled widely and worked in the oil and gas, power generation, defence, technology and banking industries. He has been blogging about peak oil since 2004 at Peak Energy (Australia) and is probably the most prolific example of a techno-optimist in the peak oil world.

Phil Hart - Phil studied Materials Engineering at Monash University in Melbourne before spending five years with Shell UK Exploration and Production. He worked on two new North Sea oil and gas field development projects before joining the Brent field maintenance team as a corrosion engineer. In late 2006, Phil returned to Melbourne and is an active member of the Australian Association for the Study of Peak Oil. He has provided briefings to local government, fund managers and other businesses and presented on the issue at community events and local oil industry forums.

SP - SP has been a long time reader and part time contributor or commentator to Energy Bulletin and TOD-ANZ. He frequently annoys Gav by posting items of possible interest for Peak Energy. SP is an environmental scientist (of sorts) who recently completed his PhD: his ignorance now comes with qualifications. After a brief flirtation with doomer nihilism, he now tries to entertain a more hopeful and optimistic outlook - mostly. SP currently resides somewhere on the Indonesian Archipelago.

Posted by Big Gav