Archive for the ‘oil companies’ Category

ANWR — Trillion-dollar Arctic cathedral

November 17, 2008

Barack Obama promised change. Here is a good prospect. Few areas of public debate have been as stale – as barren of substance, focused instead on powerful emotional symbols – as the oil development of the Arctic National Wildlife Refuge (ANWR) in northeast Alaska.

By Robert Nelson
The Washington Times

David Kreutzer discusses Arctic oil.  

For the environmental movement, ANWR development long ago became a sacred cause that served above all as a litmus test of whether “you are with us or against us.” It is time to move past all that.

The proponents of ANWR development have also distorted the picture by themselves making false arguments. First, it should be acknowledged that ANWR oil production will not in itself come close to achieving energy independence for the United States. Second, ANWR production alone will not affect oil prices significantly. Even the large reserves that ANWR possesses are not large enough, relative to the total world oil market, to have much effect on future world prices.

The real issue in ANWR is the proper use of the fiscal assets of the U.S. government. The oil there is worth, minimally, $500 billion in gross value and, potentially, $1 trillion dollars or more – depending obviously on the future world price of oil. With the current dire economic situation, and federal deficits projected to approach a trillion dollars in the next year or two, the United States can no longer afford to leave this immensely valuable economic asset to simply sit idle.

The best estimates available, released by the U.S. Geological Survey in 1998, concluded there was a 95 percent probability of finding at least 5.7 billion barrels of “technically recoverable” oil, a 5 percent probability of finding 16.0 billion barrels, and a 50 percent “mean” probability of finding 10.4 billion barrels. For the mean probability, this includes 7.7 billion barrels actually inside ANWR on federal lands, and 2.7 billion barrels owned nearby by Alaska Native Corps. and the state of Alaska (which could be economically produced only in conjunction with the development of the ANWR federal reserves).

An oil pump seen in constant motion, in this photo dated Wednesday, ...
AP

World oil prices have been changing so rapidly that any prediction is uncertain. But at assuming for purposes of discussion a future world oil price of $50 per barrel, the mean expectation for the federal and nonfederal ANWR oil reserves is a cumulative gross market value of more than $500 billion – and it would be worth more than $1 trillion at prices of $100 per barrel. It might cost $20 to $30 per barrel to produce most of the ANWR oil, but the net revenues (after costs) would still probably be greater than $300 billion (and could turn out to be much higher, depending on the future price of oil). To put this in perspective, the United States could have paid most of the interest payments on the national debt in 2008 with the likely future oil revenues obtainable from ANWR.

The objection will no doubt be raised that ANWR production would benefit oil companies, not the federal government or average American citizens. As noted above, however, three-quarters of ANWR oil is on federal land, and the rest is on Native American and Alaska state land. Like existing federal oil and gas leasing on the Outer Continental Shelf (OCS), the ANWR oil would probably be made available to oil companies by competitive auctions and the government would also charge a large royalty on any future production. Throughout the world, the true beneficiaries of petroleum resources are not the oil companies who may physically extract the oil but the actual owners of the resource.

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http://www.washingtontimes.com/news/2008
/nov/17/trillion-dollar-arctic-cathedral/

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Congress grills oil execs on high prices

April 1, 2008
By H. JOSEF HEBERT, Associated Press Writer

WASHINGTON – Don’t blame us, oil industry chiefs told a skeptical Congress. Top executives of the country’s five biggest oil companies said Tuesday they know record fuel prices are hurting people, but they argued it’s not their fault and said their huge profits are in line with other industries.

A pump attendant fills up a car at a gas station in Kuala Lumpur ... 

Appearing before a House committee, the executives were pressed to explain why they should continue to get billions of dollars in tax breaks when they made $123 billion last year and motorists are paying record gasoline prices at the pump.

“On April Fool’s Day, the biggest joke of all is being played on American families by Big Oil,” Rep. Edward Markey, D-Mass., said, aiming his remarks at the five executives sitting shoulder-to-shoulder in a congressional hearing room.

“Our earnings, although high in absolute terms, need to be viewed in the context of the scale and cyclical, long-term nature of our industry as well as the huge investment requirements,” said J.S. Simon, senior vice president of Exxon Mobil Corp., which made a record $40 billion last year.

“We depend on high earnings during the up cycle to sustain … investment over the long-term, including the down cycles,” he continued.

The up cycle has been going on too long, suggested Rep. Emanuel Cleaver, D-Mo. “The anger level is rising significantly.”

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http://news.yahoo.com/s/ap/20080401/ap_on_go_
co/congress_oil;_ylt=Aijgm
45vw1D.gHsSolaFa5Gs0NUE

House OKs boost for renewable energy

August 4, 2007

H. JOSEF HEBERT, Associated Press 

WASHINGTON – The House approved incentives for renewable energy and conservation Saturday, and edged closer to passing nearly $16 billion in taxes on oil companies.

Republican opponents said the legislation ignores the need to produce more domestic oil, natural gas and coal. One GOP lawmaker bemoaned “the pure venom … against the oil and gas industry.”

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http://news.yahoo.com/s/ap/20070804/
ap_on_go_co/congress_energy;_
ylt=AsTM0698rrWoqJ0O4hjmceKs0NUE