August 2006 Archives

A recent bill enacted by the Venezuelan government hikes the income tax rate from 34 percent to 50 percent for 6 foreign oil giants working in heavy oil ventures in the Orinoco basin.

Chevron Corp. is one of the companies affected by the increase which will be effective from January. Chevron did not comment on the Venezuelan announcements and its stocks closed down by 55 cents at $65.19.

Deputy oil minister Bernard Mommer said that the government is looking at a minimum 51 percent stake in those same ventures and a decsion on that will most likely be taken before December.

President Chavez has steadily taken a larger share of the profits from the Orinoco projects, which produce as much as 600,000 barrels a day of oil. Earlier in May, the government had increased royalties on the four projects from 16.6 percent to 33.3 percent.

This move may jeopardize investments as it basically eats into the companies' share of profits while making them shoulder a greater burden of costs.

Read

Picture Courtesy: www.flickr.com

The US has carried out its 23rd subcritical nuclear experiment since 1997 successfully at an underground test site in Nevada.

It was the tenth test under the Bush administration, despite persistent criticism by anti-nuclear groups and amid intensifying efforts to curb the nuclear programs of Iran and North Korea.

The US government denies that the tests violate the Comprehensive Test Ban Treaty on nuclear weapons saying that these tests do not involve a nuclear chain reaction and are designed to "examine the behaviour of plutonium as it is strongly shocked by forces produced by chemical high explosives".

The government denied allegations that it was carrying out tests to boost its efforts to develop new nuclear arms and that they are fully consistent with the nuclear test moratorium it has maintained since 1992.

The administration said the tests were conducted to gather "scientific data that provides crucial information to maintain the safety and reliability of the nation's nuclear weapons without having to conduct underground nuclear tests."

The government stance is that the tests are essential to ensure the safety of nuclear stockpiles.

Read

Picture Courtesy: www.flickr.com

As US demand for energy is consistently increasing, there is a strong possibility of the government seriously stepping up its reliance on nuclear power.

20 percent of US electricity supply comes from nuclear power. The last nuclear power opened in the US ten years ago.

Dale Klein, chairman of the Nuclear Regulatory Commission, said that several things make nuclear power an attractive option, primarily that it does not emit carbon dioxide which contributes to global warming and the unpredictability of fossil fuel costs.

He said the Nuclear Regulatory Commission has received applications for 27 new nuclear power plants in the US and some of them were "very, very strong" expressions of interest.
To adjust with the increasing number of applications, the agency has created a new office of new reactor operations so that the individuals that are monitoring the existing fleet are not distracted.

Past history including the Chernobyl and Three Mile Island nuclear plant disasters have underscored public concerns over the safety of a nuclear plant.

Klein said he is confident that existing and new nuclear energy plants in the US are and will be safe and secure.

France, Japan, Russia and Germany have significant nuclear energy generating programs.

Read

The oil spill from the sunken oil tanker Solar 1 off Guimaras island in the Philippines is being touted as a disaster on the scale of the Exxon Valdez catastrophe.

Though the amount of oil aboard Solar 1 is a fraction of what the Valdez disgorged when it foundered off Alaska, the fact remains that the Valdez spilled in a relatively remote area. A number of people depend on the Guimaras region for their livelihood and with the Solar 1 having leaked one-tenth of the contained oil so far, experts say a ticking time-bomb is on the ocean floor.

Nestor Yungue, a marine biologist said that the speed with which the oil reached the Guimaras coast is a concern since it does not allow for the chemical disintegration of the pollutants. The Valdez crude took time to hit the Alaskan coast contaminating 1,300 miles of coastline, killing a quarter-million sea birds, 1000's of otters and hundreds of seals.

It will be 3 to 6 months before we are able to see the damage in this instance.
Environmental economist Rodelio Subade said damage from the Solar 1 would not be limited to 'tradable goods' like fish stocks but could have an impact on generations of fishermen.

The Taclong national marine reserve took a direct hit when the tanker sank. Mangroves expert, Resurreccion Sadaba, said that coral reefs and marine organisms including fish and mollusks have started dying. He also said seedlings and saplings among 90 hectares of mangrove thickets, vital shelters for fish fry, were already “showing signs of withering”.

Mangroves are the basis of the marine food chain and with their removal the whole system will collapse.
The Taclong reserve is also a vital nursery for 2 of the country's richest fishing grounds, the Sulu Sea and the Visayan Sea. If the spill is not contained within the narrow straits on either side of Guimaras, these would be hard hit.

The tourism industry is already suffering with mass cancellations for both this year and the next.

The Coast Guard is spraying dispersants to contain the slick, pushed by currents and monsoon towards the Visayan Sea. When the winds shift in October, it will be open seas between the tanker wreck and the Sulu Sea which is the site of one of the world's most biologically diverse coral formations.

A Japanese salvage ship is on its way to try to refloat the tanker or siphon off the remaining oil.

All of the Sunshine Maritime Development's remaining tankers have been grounded since the Solar 1 sank. Company president, Clemente Cancio, defended the qualifications of Norberto Aguro, the tanker's captain saying he was an expert in manning chemical tankers which are more difficult to handle than oil tankers. But he added that Aguro might have been wrong in setting sail in those weather conditions. The tanker had passed inspection before it sail.

The Board of Marine Enquiry questioned why there were excess of 4 men on a tanker with a capacity of 16 and noted that the tanker was only carrying 19 life vests.
Cancio said that Petron Corp., the company which had chartered Solar 1 required at least 2 surveyors on board and the crewman present at the enquiry affirmed that the 2 seamen who are missing had been wearing life jackets before the tanker capsized.

Read

Picture Courtesy: www.flickr.com

Chad backed down from an apparent threat to nataionalize part of a foreign oil consortium comprising ExxonMobil, Chevron and Petronas, saying it was ready to renegotiate a deal with the partners that would give the state a share.

Chevron and Petronas had been ordered to halt pipe-laying operations over allegations of non-payment of taxes. The two companies insist that they have complied with the tax obligations and are in talks with the government.

President Idriss Deby in a speech had said that Chad wanted to join the consortium with a 'reasonable' 60 percent stake - the exact size of the share held by Chevron and Petronas arousing speculation that Deby was proposing to seize control in an act of hardball  resource nationalism.
At present the state receives royalties and taxes.

But a government spokesman on the following day denied any such nationalization plan. He claimed that there was no connection between the government's desire to renegotiate and the tax dispute.

Dieudonne Djonabaye, deputy communications director at the presidency, said the government and ExxonMobil would together 'provisionally' run the consortium for the time being.
Contradictions have been noted between Deby's speech and Djonabaye's assertions. While Deby demanded a 60 percent national stake, Djonabaye said the exact size of the stake has not been decided. Deby also doubled the figure of alleged unpaid taxes to double the number he had previously quoted.

His government has earlier locked horns with the World Bank and has threatened the country's oil partners.
With the actual operation of the pipeline being handled by Exxon, the oil output has not been affected by the dispute.

Read

Picture Courtesy: www.flickr.com

US Senator Richard Lugar challenged America's automakers and citizens to decrease dependency on foreign oil at a Summit on Energy Security.

The day long summit held at the West Lafayette campus focused on foreign oil dependence and alternative fuels. Besides Lugar, Gov. Mitch Daniels and Purdue President Martin Jischke also spoke to a 1000 strong audience. Panel discussions included representative from BP Inc and Ford Motors.

Lugar proposed a series of measures to contain problems including mandates for more flexible-fuel vehicles, boosted ethanol production and usage, and the implementation of stricter vehicle mileage standards and convincing the federal government to enhance alternative fuel production through a progressive loan program.

He said that failure on the part of the nation to bring about a change in the energy policy despite repeated warnings would be more unconscionable given that success would not only contribute towards a better geopolitical climate but also provide restorative economic benefits to farmers, automakers and others.

Read

Picture Courtesy: www.flickr.com

Update

With tropical storm Ernesto veering away from the oil and gas region of the Gulf of Mexico contrary expectations of an active tropical storm, oil prices fell sharply to below $70 a barrel. The average retail price of gasoline has fallen by 20 cents nationwide.

Citing lawyers and traders close to the case, The Wall Street Journal claimed that federal investigators are examining whether BP PLC manipulated crude oil and unleaded gasoline markets.

BP is already facing a civil complaint filed by federal commodities regulators for allegedly manipulating much of the US propane market. Besides this, BP has been summoned before the Congress over the corrosion problems at its Alaska pipelines.

The separate investigations on crude oil and gasoline will intensify pressure on BP as their markets are bigger and directly affect most American households.

The Federal investigation indicates a rise in regulatory scrutiny of BP.

The oil company was not available for comment.

Read

Picture Courtesy: www.flickr.com

A semiannual survey of 195 economists conducted by the National Association for Business Economics said that the US economy would go into recession only if oil prices hit $100 a barrel but predicted that oil would not ultimately move that high.

The median forecast for next summer's oil price is similar to the present rate at about $75 a barrel. Terrorism continued to be the paramount short-term problem facing the US economy according to 34 percent of the respondents with energy and inflation following owing to the small prospects of other technologies substituting oil in the next decade.

Only 35 percent of respondents believed that the war in the Middle East would spread and most agreed that violence in that region would not result in major disruptions in oil supply to the US.

Earlier this month, Federal Reserve policy-makers decided to keep the interest rates unchanged at 5.25 percent after more than 2 years of a successive rate increases intended to curb inflation.

The percentage of respondents who expect the Fed will tighten further has dropped from 89 percent to 57 percent.
And while the majority of respondents at 71 percent say the current monetary policy is about right, the panel is spilt on where it should go with 29 percent wanting further rate hikes, 17 percent wanting cuts and 53 percent opting to leave rates at the current level.

The survey was taken in the first fortnight of August.

Read

Picture Courtesy: www.flickr.com

Substandard contruction work has caused a consortium led by Royal Dutch Shell PLC to suspend pipe-laying work at a mudslide-prone mountainous section of its giant liquefied natural gas project, called Sakhalin-2, on Russia's far eastern island of Sakhalin.

The halt on work is not expected to push back the project's completion date. About 870 miles of the final combined length of 1,000 miles of oil and gas pipelines have already been welded.

Monitoring by the company revealed "isolated examples of subcontractors not maintaining certain standards ... This is not acceptable to the company, therefore we have suspended work in certain areas within the Makarov mountain range."

Russia's Natural Resources Ministry is auditing the project and called for construction to be halted over mudslide concerns earlier in the month. The ministry's attention might be aimed at pressuring Shell to offer OAO Gazprom, a state-controlled gas monopoly, better terms as it jostles to join what will be the world's biggest LNG development.

Gazprom is asking for a 25 percent-lus one share stake in Sakhalin-2 in exchange for giving Shell access to the far northern Zapolyarnoye-Neocomian field, the world's fifth-largest gas deposit.

Last July, Shell said the expected cost of developing Sakhalin-2 had doubled to around $20 billion due to currency swings and rising prices of commodities such as steel.

Gazprom wants to reduce the assets it's offering in the swap deal as the cost increase has diminished the value of the stake it wants.

Read

Picture Courtesy: www.flickr.com

Speaking at an oil and natural gas conference in Norway, ExxonMobil's CEO said that new technological advances that have pushed the frontier of oil exploration and increased production from oil wells will help quench the world's thirst for oil for decades.

Rex Tillerson took over as CEO of Irving-based ExxonMobil, the world's biggest publicly traded oil company, 8 months ago. He said technology allowing oil companies to drill deeper will ensure that there is no shortage of supplies and that the Norwegian sector of the Barents Sea, shared with Russia, could contain one-third of Norway's undiscovered resources.

Read

Picture Courtesy: www.flickr.com

As part of a plan to boost Venezuela's oil output, China will invest around $5 billion in energy projects in the country by 2012.

Rafael Ramirez said that the initial investment made by China is very important as it is part of the increase in oil production, which is projected at 5.8 million barrels per day by 2012.

Currently, Venezuela is providing 150,000 bpd of oil and products to China with the joint plan aiming to reach up to 500,000 bpd by 2012.
Ramirez added that the Chinese investment was inclusive of a joint venture to operate the Zumano fields in eastern Venezuela and investment by China's CNPC in the Orinoco heavy crude belt.

PDVSA, the Venezuelan state oil company, plans a total investment of $56 billion by 2012 as part of an expansion plan that includes increasing natural gas production, boosting refining capacity and launching a wide-scale development of the Orinoco heavy crude belt.

Chinese energy company Sinopec will be part of the development of an oil block in the Gulf of Paria. Besides this China will also help Venezuela build 18 new oil tankers by 2012.

President Hugo Chavez of Venezuela just rounded off a visit to China to sign cooperation accords as part of an effort to reduce Venezuela's dependence on US energy markets.

Read

Picture Courtesy: www.flickr.com

Two major foreign oil companies, US based ChevronTexaco and and Malaysian Petronas, had been ordered by Prseident Idriss Deby to leave Chad over alleged non-payment of taxes. The imposed 24-hour deadline has expired.
Chevron said that it has fully complied with tax demands and has received no "official notification" to leave.
Petronas has not commented.

While it is not clear how the authorities plan to enforce the expulsion order, the two companies that together account for 60 percent of Chad's production have denied the charge of non-payment.

Mahamat Bechir Okormi, Chad's minister for state control and ethics, said that Chevron and Petronas had to pay tax but arranged with a minister in order to get a tax exemption. In Chad, only the national assembly can exempt companies.

Three government ministers have been sacked and may be prosecuted and Oil Minister Mahamat Nasser Hassane has been dismissed.

With the expuslion of Chevron and Petronas, the only remaining company in the consortium which handles the country's oil production would be ExxonMobil.
Since ExxonMobil runs the pipeline and the other two companies have few staff in the country, production is unlikely to be seriously affected, especially since President Deby said that his government would take control of the remaining reserves.
The government had recently evinced its interest in joining the consortium.

Following Chad's revival of diplomatic relations with Beijing, observers feel that the firms may have been expelled to make room for Chinese oil companies. If true, this move will mark a turning point for realtions in this region.

Earlier this year, Chad threatened to stop oil production if the US led consortium did not pay up several months' worth of oil revenues.
Chad also had a run-in with the World Bank over allocation of oil revenue spending.
Rows over Chad's oil revenues have been simmering for months and the recent decision of expulsion has sent shock waves around the oil industry.

Read

Picture Courtesy: www.flickr.com

Prseident Arroyo's Executive Order 565 revoked a contract awarded to Malaysian oil company for production in the Philippines.

Mitra Energy Ltd. had won a tender to take part in the development of oil deposits in the Camago-Malampaya field off western Palawan Island. Mitra had secured the rights in a preliminary agreement with a unit of Philippine National Oil Co. The contract was made null and void by an order that directed PNOC and other government agencies from subcontracting out work covering exploration or development in the Camago-Malampaya reservoir with no warning and no explanation, sending a shudder through the foreign investment community.

Peter Wallace, a cosultant for foreign multinational corporations with over 30 years of experience in the Philippines, said that investors were concerned about the "sanctity of contracts in this country".

Upstream, an oil exploration publication, said the move was “understood to be due to pressure from influential Filipino business interests, which do not want the potentially lucrative projects to be awarded to a foreign company.”

The unease over the order was reflected in other agencies such as PNOC and the Department of Energy which were taken by surprise and the French Chamber of Commerce which stated that "this occurence would not help the establishment of confidence in the Philippine market which we have been fighting for."

Chris Whitmee, a spokesman for Mitra, said that the company has spent upwards of a million dollars preparing for the bid and had already lined up contracts with international vendors. The sudden directive has taken them completely by surprise particularly as the objection has been based on subcontracted exploration (farm-in) and development (farm-out) contracts, which are worldwide energy sector benchmarks.

Whitmee said that Mitra was waiting for an explanation and had not given up on the project.

Others in the industry are watching to see how the government justifies its decision to revoke a contract after it has been assigned.

Read

Picture Courtesy: www.flickr.com

A storm brewing in the Caribbean weakened and took concerns over US oil supply and prices down with it.
Hurricane Ernesto was downgraded to a tropical storm after it flooded Haiti's southern coast. However, meteorologists predict that the storm is likely to pick up force again as it moved towards the Gulf, possibly reaching hurricane levels.

Light sweet crude for October delivery fell 76 cents to $71.75 on the NY Mercantile Exchange.
Prices at London's ICE Futures exchange fell by 55 cents to $72.15 a barrel.

The unpredictable storm and unease over Iran's nuclear program will make trade in the energy markets hard over the next few weeks, with both factors having the capacity to generate new highs in the crude market.

While large oil producers in the Gulf of Mexico are prepared to evacuate non-essential personnel, world energy markets are also concerned over Iran's stand-off with the West over its nuclear program.

Natural gas futures on the Nymex went down by 51.8 cents to $6.64 per 1,000 cubic feet and gasoline futures fell 4.41 cents to $1.8510 per gallon. Heating oil futures dropped 1.58 cents to $2.0140 a gallon.

Read

Picture Courtesy: www.flickr.com

ExxonMobil CEO, Rex Tillerson, urged the government to "provide timely access to resources" for energy exploration to boost supplies and meet the rising world demand.

With crude oil prices having more than doubled over the past 3 years owing to surging demand for petroleum-based fuels, Tillerson feels that the government should enable energy companies to exploit the full extent of their technology and know-how to bear to new supply opportunities.

"Most energy technologies are developed with specific resources in mind. If these resources are made off-limits, the incentive for R&D is reduced."
Some international oil producers can lay claim to more expertise than state-owned entities that control some of the world's largest oilfields. This expertise is sorely needed to fully develop aging or difficult-to-reach reserves.

Tillerson said that developing nations spending a higher proportion of their GDP on energy are making themselves vulnerable and that current crude prices are harmful to world econominies.

At the press conference, Tillerson also said that he hopes the company's differences with Venezuela over oil contracts can be resolved with negotiations; He was unable to provide the financial impact of a slowdown in production due to the Prudhoe Bay Field shutdown; He would like to expand ExxonMobil's oil business in Russia and that while rivals are shutting wells in Nigeria, ExxonMobil would like to increase production there.

Read

Picture Courtesy: www.flickr.com

Iran responded to the incentive package given by the Western powers on Tuesday and said that it had offered positive signals in its proposal to resolve the standoff over its nuclear program.

Iranian Foreign Ministry spokesman Hamid Reza Asefi said that if the Europeans paid proper attention to the positive and clear signals in Iran's response, then the nuclear standoff can be solved through negotiation and without tension.
But key UN Security Council members differed in their responses.

The US State Department agreed that Iran was sincere in its proposal but it fell short of the conditions set by the UN - the mainone being that Iran halt nuclear enrichment.
French Foreign Minister Philippe Douste-Blazy said that only if Iran suspends enrichment can negotiation continue.
German Foreign Ministry spokesman Martin Jaeger said that the UN demand for suspension of enrichment indicated that Iran has lost the confidence of the international community that its nuclear program is civilian.
On the other hand Russia's Foreign Ministry said that talk of sanctions was premature before the Aug. 31 deadline was met and that they would continue to seek a negotiated solution.

China urged United States and its allies to be patient and Iran towards "constructive measures".

Read

Picture Courtesy: www.flickr.com

In the face of Iran's defiant stance on its nuclear program, Israel has signed a contract with Germany to buy 2 more submarines capable of firing nuclear missiles.

The one billion deal was signed last month and Germany has agreed to take up costs of upto a third of the value. The submarines will be operational shortly and add to Israel's expanding military resources.

It already has 3 Dolphin-class submarines which can fire nuclear missiles, but the newer models can stay submerged for longer.
Israeli security sources said that in the light of Iran's nuclear ambitions and an Iranian President who has called for Israel to be "wiped off the map", the submarines are needed to counter long-range threats.

Owing to Israel's small land area, its military planners have a clear preference for submarine-launched nuclear weaponry. US Defence Intelligence Agency has estimated that Israel has about 60-85 nuclear warheads. Submarine-based missiles give the country a credible nuclear deterrent.

The semi-official news agency Mehr said that Iranian authorities would announce a "very important achievement" in an area of nuclear technology.
In its response to the western incentives package, Iran has offered to address the issue of suspension while reminding the world of its "stablizing role" by offering to its influence with Hezbollah to organize an exchange of prisoners between Israel and Hezbollah.

Iran will be further encouraged in its stance by the divided responses from the international community to its proposal. While China and Russia prefer to puruse negotiations, France will have none of it till the suspension of uranium enrichment and ironically America's war on terror has "severely compromised" its attempts to curb Iranian nuclear amibitions.

With the war on terror eliminating Iran's two main regional rivals - the Taliban in Afghanistan and Saddam Hussein's regime in Iraq without replacing them with stable structures has given Iran regional supremacy. Iran's links with its neighbors need to be understood to see why "Iran feels able to resist western pressure". If the US uses military force to curb Iran's nuclear ambitions, it would open itself up to retaliatory destabilizing intervention by Iran for its forces in Iraq.

Read

Picture Courtesy: www.flickr.com

With Oil Minister Sharistani signalling that Iraqi oil fields are going to be thrown open for investments worth $20 billion this autumn, top oil companies are maneuvering to win a stake in their oilfield of choice.

Multinationals are poring over data from Iraq's oilfields to gain the edge when bidding begins and are ready to act quickly but have noted that with the lack of investment laws and security drilling in Iraq might not be imminent.

Right conditions will have to be met before a company commits to investmemt.
Iraqi officials assure that their country's oilfields have not been assigned in advance and that a transparent process where the best bid wins shall be put in place.
They are fully aware that oil majors like Shell, BP, ExxonMobil, Chevron and Total are vying for Iraq's cheap and easy-to-produce reserves.

Over the past 3 years, many firms have been involved in technical studies and training programs that allow them regular access to oil ministry officials outside Iraq. An Iraqi official said that those firms who are acquainted with them will stand a better chance when the investment opportunities open up.

The majors have been scrutinizing data on southern Iraq oilfields that could boost production by as much as 3 million barrels per day and have made recommendations on production policy for certain fields.
Some majors gathered a wealth of information from a decade when Iraq was under UN sanctions and have an edge on certain fields due to this spadework.

Though Total was in line for Majnoon and Bin Umar, ENI and Respol interested in Nassirivah and Shell looking into Ratawi, officials say that the final competition will be wide open.

Iraq has been struggling to pump 2 million bpd after reaching close to 3 million bpd prior to the US led invasion in March 2003.
With the country struggling with sabotage and mismanagement, multinationals have been helping trouble-shoot at North and South Rumaila and other problem oilfields to ensure the country's production and exports.

The majors have certainly not wasted the last three years.

Read

Picture Courtesy: www.flickr.com

BP has put plans for a 320 million pound liquefied natural gas terminal in Texas on hold.
The proposed LNG terminal was to be located just 10 miles from BP's refinery which killed 15 people in an explosion about a year ago.
While the plan garnered some support in the area as it would have created 80 jobs and increased the level of traffic in Port Galveston, it ran into some controversy from environmentalists and residents caught up in the Texas city blast.

A spokesman claimed that the decision had been made on economic grounds and had not been influenced by local politics.
The company announced that it would renew its lease on the Pelican Island site that had been earmarked for the terminal for another year while it considered the economic viability of Pelican Island.

There is a strong demand for gas in the US, with supply falling short. BP is looking to take a stake in the demand. LNG terminals make it possible to bypass the huge cost of developing pipelines between gas producing countries and countries with more demand than domestic supply.

At present the US has 4 LNG terminals, with proposals for another 40, raising fears of excess gas supply pushing down prices.

Read

Picture Courtesy: www.flickr.com

The city leaders in Georgia with an industrial partner have transformed a environmentally hazardous trash pit into a stream for revenue and renewable energy.

As trash decomposes, it leaks methane into the air, a greenhouse gas that's 20 times more damaging than carbon dioxide to the atmosphere.

The LaGrange landfill in west Georgia was made into a revenue-generating venture in 2001 when carpet manufacturer Interface, searching for an alternative fuel source for its petroleum-intensive manufacturing process, contacted LaGrange officials about converting the landfill into a clean, cheap way to conserve energy.

LaGrange eventually decided to invest the $2 million needed to outfit the landfill with a processor and miles of pipeline. Owing to a 10-year contract with Interface and another manufacturer that use the gas, LaGrange has generated $300,000 in revenue from gas sales in the first year and the city expects to turn a profit in just 5 years.

The economics of conversion of landfill to methane often don't work for smaller sites. The EPA's landfill methane outreach program has 400 projects designed to promote landfill gas as an alternative energy source. But it's no easy task with the LaGrange venture being a model where an industrial partner spearheaded the project and the city leadership showed willingness to shoulder the immediate expenses.

Cleaner alternative sources of energy can be scarce or expensive but landfills, which dot big cities and rural towns alike, offer an overlooked supply that's not subject to import taxes, is very reliable and is not coming from another country!

Read

Picture Courtesy: www.flickr.com

An ambitious effort to expand the use of solar power in California's homes was signed into law by Gov. Arnold Schwarzenegger.

As part of the administration's green energy initiative, the "Million Solar Roofs" bill is an aggressive effort to create incentives for homeowners to buy, and builders to offer, solar powered energy.

The bill requires that by 2011 all home builders must make solar panels a standard option on any project of 50 units or more.

Due to the difficulty in obtaining solar cells and the fact that new home buyers might choose granite countertops over energy efficiency, the bill could be difficult to implement.
Les Nelson, executive director of the California Solar Energy Industries Association feels that the bill should have made a solar power energy system a standard option for home buyers.

The new policy also challenges two powerful groups: energy companies and the building industry.
Tim Coyle, senior VP of the California Building Industry Association said that while his organization supported the bill, it can't be shoved down consumer's and builders' throats.

A homeowner with a solar power system can produce more energy than required and sell it back to PG&E for a monthly credit, so that the company owes them money. The new law lengthens the amount of time new homeowners can sell energy back to their utility at retail prices.

Current law capped this program at 0.5 percent of a utility's peak demand which has been increased to 2.5 percent of peak demand under the new law so that more new-home buyers can benefit from solar power incentives.

Municipal utilities like Alameda Power & Telecom are directed under the new law to follow PG&E's example and create their own solar rebate program.

Another point in favor of the new law is that it has called for the Energy Commission to study whether solar energy should be required on new residential and non-residential buildings.

Read

Picture Courtesy: www.flickr.com

Iran turned away UN inspectors from its underground facility at Natanz. This action comes in concert with the country's supreme leader's avowal that Tehran will not give up its contentious nuclear technology.

Hopes that Iran will accept the UN Security Council demand to halt its enrichment by Aug. 31 have deflated in the face of Iran's unprecedented refusal to allow access to the underground site.
This action hampers UN attempts to ensure that Tehran is not trying to produce nuclear weapons.

Signs of Iran's defiance have been noted with the country denying entry visas to 2 International Atomic Energy Agency inspectors in the last few weeks after similar denial to Chris Charlier, the expert heading the UN agency's team to Tehran earlier this year.

Iran's reported actions could lead to heavy sanctions including a ban on missile and nuclear technology sale to Tehran, a ban on investments in the country and international refusal to grant entry visas to people involved in Iran's nuclear program and a freezing of their assets.

Read

Picture Courtesy: www.flickr.com

Solar 1, a tanker carrying around 2 million liters of oil sank off the Philippines coast 11 days ago and is continuing to leak according to coastgaurd officials.

While the head of the Philippine Coastgaurd said that more oil had leaked from the sunken tanker overnight, a spokesman from Petron Corp said that their aerial surveys have confirmed that there is no more seepage.

The widening slick has already damaged about 200 miles of the Guimaras island coastline, and is now threatening fishing grounds.

Sludge and dead wildlife have been washing up on the beaches, causing damage to reefs, marine reserves and tourism.

Villagers from the neighboring Negros and Panay islands have erected makeshift booms to hold the oily sludge back.

In response to the Philippines government's appeal for international assistance with the clean-up, teams of experts from Japan and the US are expected to assess the damage.

Presidential spokesman Ignacio Bunye said the government needed to focus its energy and resources in addressing the problem and that it was making "tactical decisions" on the clean-up.

The tanker was on its way to a power plant on the southern island of Mindanao when it sank. Of the 20 crew members, 2 are still missing.

Officials are trying to decide whether it would be best to refloat the vessel or to suck out the remaining fuel.

Read

Picture Courtesy: www.flickr.com

BP PLC denied allegations made by unidentified BP workers that the company had manipulated data from the pieline inspections at Prudhoe Bay, where operations have been cut down this month following a pipeline leak.

The U.S. Environmental Protection Agency is probing allegations that BP inspected more areas of known good pipe than bad and thus manipulated data in order to avoid replacing pipelines. Days after the pipeline leak and subsequent shutdown, Transportation Department's Pipeline and Hazardous Materials Safety Administration had ordered the firm to conduct more rigorous tests on the transit pipelines.

BP spokesman, Robert Wine said that the company has been working with the DOT and the EPA ever since the original leak and would provide any information required for the investigations.

Alaska Attorney General David Marquez said that the state had served subpoenas on BP and other leaseholders in Prudhoe Bay to preserve all documentation related to the Aug. 6 pipeline leak and corrosion dating to 1996.

Read

Picture Courtesy: www.flickr.com

Orizont, a Romanian oil rig moored near Kish Island, off the Iranian coast, since 2005 came under fire and was later occupied by Iranian troops.

The Iranian military warship first fired into the air and then at the rig. No injuries or deaths have been reported, though shortly after occupation of the rig by the troops, the Romanian company lost contact with the 26 crew members on the rig.

The Romanian company, GSP, also known as Oil Services Group opeates 6 offshore rigs that it bought from Romania's largest oil company, Petrom. Two of its rigs are operating near the Iranian coast.

GSP was in Iranian courts earlier this year over a dispute involving Fortuna, another one of its oil rigs. It has not been ascertained whether the recent incident involving the Orizont rig is in anyway connected to the Fortuna matter.

Read

Picture Courtesy: www.flickr.com

On the eve of a self-imposed deadline for responding to economic and technological incentives offered by Western powers in lieu of their uranium enrichment program, a spokesman from the Iranian Foreign Ministry said that suspension of uranium enrichment is not on the agenda.

The proposed incentives package includes provisons for direct talks between Washington and Tehran and the offer of nuclear technology and the easing of some trade restrictions. Iran said that it would give a multi-faceted response to the incentive package tomorrow.

United Nations may move fast on its threat to impose sanctions against Iran because of the country's inflexibilty. Nothing less than the suspension of the enrichment program is likely to appease the UN.

After its proxy militia in Lebanon, Iran emphasized its stand by conducting military exercises over the weekend including the televised launch of ground-to-ground short range missiles. These were to showcase "Iran's new defensive doctrine."

After the Israeli failure in disarming Iranian-backed Hezbollah, the country clearly feels it has a strong position and has warned that it would be prepared to use oil as a weapon.
Though Iran insists its uranium enrichment program is permitted under the nuclear non-proliferation treaty and is peaceful, western concerns over nuclear Iran have increased after the Lebanon war.

Iran may feel that it can play for time because any further decisions to be taken by the UN would have to be discussed by the Security Council and Russia and China who have veto-holding powers in the Council have been supporters of Iran.

Read

Picture Courtesy: www.flickr.com

The Japanese government which is largely dependent on Middle Eastern oil with 14 percent of total oil imports coming from Iran said it will oppose United Nations sanctions on Iran's energy sector.

Tehran faces the risk of sanctions if it doesn't abide by the UN Security Council resolution calling for a halt to their uranium enrichment program.
A ban on Iranian oil exports would adversely affect both Iranian and global economies. The Japanese governmemt hope sto avoid losing Iranian oil supplies and is likely to propose that financial sanctions be imposed first and the oil embargo later.

Japan's position could put it at odds with the United States, a close ally, which has worked with Japan to punish North Korea for its nuclear drive and missile tests. Japan has resisted calls from the U.S. to suspend development of Iran's largest onshore oil field.

Iran has said that it will respond to the incentives offered to it by major powers for stopping its uranium enrichment by Tuesday.

Read

Picture Courtesy: www.flickr.com

With the prospect of Iran standing defiant on its nuclear work and disregarding UN sanctions, U.S. light crude for September delivery went up by 49 cents to $71.63. London Brent crudefor October climbed to $72.73 a barrel.

The UN has proposed a second deadline of Aug. 31 for Iran to halt its uranium enrichment or face punitive action, but it seems that with the survival of Hezbollah, Iranian confidence has been bolstered setting the stage for a confrontation over nuclear development.

Traders fear that Iran could withhold exports of as much as 2 million barrels per day in retaliation to any sanctions imposed by the UN.

The production boost from the Prudhoe Bay oil field to half its normal capacity and the cease-fire in Lebanon have helped knock over 7 percent off oil prices but concerns remain over the fragility of the cease-fire and now the added worry over Iran's intentions.

Read

Plans for a wind farm that could supply half of Cape Cod's electricity to be built off of Buzzards Bay may have to be revised after a report finds that the wind turbines would be illegal under the Ocean Sanctuaries Act and may also threaten the roseate tern, an endangered bird species.

The Ocean Sanctuaries Act prohibits structures from being built on the seabed or under the subsoil and also forbids construction or operation of offshore or floating electric generating stations in the Cape and Islands Ocean Sanctuary. So the developer's plan to build the 120 450-foot tall turbines would be illegal.

Developer Jay M. Cashman who had hoped to see the turbines produce clean energy by 2011 said he's willing to work with state officials to come to an agreement on the wind farm which cannot go ahead without approval from state regulators.

Read

Picture Courtesy: www.flickr.com

Steorn, an Irish firm says it has invented something that smashes a basic physics law - that energy cannot be created or destroyed, it can only change form and has issued a challenge to the world's scientific community to rigorously test the technology so that it can be developed.

What the company has developed is "free energy" which negates the need to recharge mobile phones or refuel cars! It involves the construction of magnetic fields so that when you travel around the magnetic fields, starting and stopping at the same position, you will have gained energy.

Sean McCarthy, the CEO of Steorn, said that the energy is not being converted from any source within the magnet but is actually newly created clean energy. He also said that Steorn was not looking to develop the technology, rather it was a by-product of another project the company was working on.

Read

Picture Courtesy: www.flickr.com

More than 13,000 gallons of fuel oil have been pumped from a 1965 shipwreck.
An 18 member team is removing the oil from the wreck due to the potential environmental hazard and containment booms have been installed around the site as a precaution.

The ship ran aground a beach at the Damon Point State Park and lay covered by sand for decades till waves exposed the rusting hulk and a beachcomber discovered oil earleier this year.

The park is an important habitat for several species of birds and a nesting site for the snowy plover and the streaked horn lark.

As much as 47,000 gallons could still be inside the 3 remaining fuel tanks in the wreck. The recovered oil is being taken for processing and re-blending to a storage operation on Kent for turning it into usable petroleum products.

The $1 million cost for pumping out the oil is being covered by the state's Oil Spill Response Account.

Read

Picture Courtesy: www.flickr.com

After unprecedented highs, crude oil futures in New York fell to the lowest price in 2 months of $70.44 a barrel.

Demand for motor fuel fell by 1.7 percent resulting in gasoline futures dropping by 17 percent. The demand for gasoline dropped by 167,000 barrels a day causing the price fall in crude oil futures.
Oil also fell this week due to the Lebanon-Israel cease-fire.
The September delivery of crude oil fell by 89 cents to $71 a barrel but oil is still up 12 percent from a year ago.

Gasoline for September delivery fell by 3.31 cents to $1.94 a gallon. The highs in gasoline were based on a lot of speculative buying centered around the hurricane season. But things are looking peaceful and concerns are reduced.

A possible slowdown in the US economy is also contributing to the falling oil prices. The index of leading economic indicators dropped at the rate of 1.4 percent over the last 6 months.

Read

Picture Courtesy: www.flickr.com

With the Lebanon-Israel truce having been announced, the clean-up work on the oil spill off the Lebanese coast can finally get underway.
OPEC has pledged 200,000 USD from their humanitarian fund to assist in cleaning up 150 km of polluted shorelines. About from the 10,000-15,000 tons oil spilled from the Jiyeh power station.

The UN had previously sent to envoys to Syria to take stock of the situation and has now announced that an International Assistance Plan has been drawn up to help the Lebanese government in dealing with the environmental disaster.
Experts under the aegis of the Regional Marine Pollution Emergency Response Center for the Mediterranean Sea drafted the plan which will be presented for scrutiny on Thursday at Athens.

The fund pledged by OPEC will be channeled through the UN Office for the Coordination of Humanitarian Affairs and will be spent on essential supplies.

Previous efforts to clean up teh oil spill met with Israeli naval blockades. Lebanese Environment Minister said his country will sue Israel for "this terrible crime", but did not give any details nor has there been any follow up since his statement last week.

Read

Picture Courtesy: www.flickr.com

Lawmakers in India have accused Washington of trying to curb New Delhi's atomic program with the controversial nuclear deal.
Detractors of the deal in India feel that it is attempting to cap the country's nuclear weapons program and also impinging on India's right to pursue atomic reserach for peaceful purposes.

The civilian nuclear cooperation deal gives India access to US atomic fuel and equipment on the agreement of allowing international inspections of its civilian nuclear reactors and segregation of its civilian and military programs.

The opposition came to the fore in a parliament debate just weeks before the US Senate is to vote on it after the House of Representatives passed it with an overwhelming majority.
The deal also needs the backing of the Nuclear Suppliers Group and has to be jointly aproved by the two houses after technical details of the pact have been finalized.

Yashwant Sinha, a lawmaker from the main opposition party said that the deleterious effect of the deal has never been in any doubt as it aims to suppress the country's strategic nuclear weapons program.

Read

Picture Courtesy: www.flickr.com

With the UN effected Lebanon truce resulting in a drop in crude oil prices, investor concerns about riskier assets reduced and US stocks gained.

Technology stocks were the biggest gainers after facing sharp declines in the last few weeks with investors turning away from volatile sectors. Cisco Systems Inc and Intel Corp buoyed the S&P 500. Shares of energy hungry industrial companies such as GE and United Technologies Corp., IBM and Intel were amongst Dow's biggest gainers.
Cisco Systems Inc rose by 55 cents to $20.09.
Intel shares rose 46 cents to $17.87 on Nasdaq.
GE Co closed at $32.82 with a 32 cent rise in NYSE trading.

The fall in crude oil prices prompted investors to sell energy shares, making Exxon Mobil Corp one of the biggest losers down by 48 cents to $69.25 on the NYSE.

With news of the Lebanon truce and BP announcing that half of Prudhoe Bay would still function, US crude oil for September delivery fell 82 cents to settle at $73.53.

Volume was light on the NYSE with about 1.4 billion shares changing hands below last year's daily average of 1.61 billion. Similarly on Nasdaq, the drop was from last year's daily average of 1.80 billion shares to 1.53 billion.

About 5 stocks rose for every 4 that fell on the Nasdaq and gainers outnumbered decliners on the NYSE by a ratio of about 6 to 5.

Read

Picture Courtesy: www.flickr.com

BP PLC has bought US wind energy firm Greenlight Energy Inc. for about $98 million to supplement its wind power business in North America.

BP said that the purchase give BP Alternative Energy instant access to a large number of high-quality wind development projects. Greenlight Energy owns the rights to develop 39 wind farms in the US which have the potential to produce a combined power generation of 6.5 gigawatts as opposed to Europe's largest power station which produces about 3.68 gigawatts.

This purchase follows BP's agreeement with Clipper Windpower to acquire 50 percent interest in 5 US wind energy projects and turbine supply options for $30 million.
With BP also securing an option to buy 9.6 million of the Californian firm's shares, Clipper Windpower shares lifted by a third.

Read

Picture Courtesy: www.flickr.com

It is welcome news that after the shut down on all operations in the Prudhoe Bay Field last Monday due to pipeline corrosion, BP has gained permission from pipeline regulators to keep oil flowing from a section of the oil field.

Prudhoe Bay which can produce 400,000 barrels a day is now down to 155,000 barrels a day.
At a time when hurricanes might might threaten supplies, the loss of the field stretches supplies. BP was expected to meet with regulators to assess testing results and measure "options for continuing and restoring" production. The company will decide in the next few days if it can keep the western side of the field open.

As per the the regulations set down by the Transportation Department's Pipeline and Hazardous Materials Safety Administration, BP will have to conduct 4 daily surveys of the lines which transport oil from the field to the Trans Alaska pipeline using heat sensors to spot leaks and do a visual check of the entire 22-mile network.

In addition BP will also strip the western line and conduct an ultrasonic test to get a full picture of its condition. A "significant number" of additional workers will be mobilized for this purpose.
The cost of inspection, repair and replacement of the corroded pipes inclusive of the $30 million to repair a line that leake din March is estimated at $200 million.
Exxon Mobil Corp. and ConocoPhillips, BP's partners in the Prudhoe Bay Field, have declared a force majeure on oil deliveries from the field that allows them to avoid penalties for failing to fulfil contracts due to unforseen events.

BP sais it was pleased that regulator's assessments didn't reveal anything that would require an immediate shutdown in the western section.

Read

Picture Courtesy: www.flickr.com

A crew of about 600 recovered 90 percent of the four tonnes of crude oil that spilled from a storage tank into the Zhouhe river in northwest China.

Workers at Yongning Drilling Co. were cleaning a tank when another burst leaking 10 tonnes of crude oil of which 4 tonnes spilled into the river causing a 5.6 mile slick.

The clean-up crew built 6 makeshift mini dams to prevent the slick from expanding.
Zhouhe is a tributary of the Luohe river which flows into the Yellow river, the country's second longest.

A crude oil spill from a pipeline run by a state oil firm in a eastern coastal province in China caused locals to rush to collect the oil and sell it to refineries for a profit.

Read

With the national oil company in Venzuela projecting worldwide revenues of $85 billion this year, President HUgo Chávez has become the world's richest petro-socialist with plans to spend the bounty on the poor.

While the government says the oil bounty is being spent on the poor, critics and even planners loyal to Chávez are worried about how wisely the money is being spent.
Some say the money is being wasted on short-term programs to boost Chávez's popularity rather than long-term growth and others are of the opinion that without firm regulation, a good portion of the windfall could be lost to corruption, and that nt enough is being saved for when the oil prices fall.

An immense amount of oil money is being spent on subsidizing food costs, giving free schooling, vocational training, aid to needy mothers, soup kitchens, free eye operations and distance-learning university degrees.

State-owned oil company, PDVSA, will pay the government about $30 billion in taxes and royalties this year, of which nearly $19 billion is allocted for social spending.

Chávez created a Fund for National Development which has already drawn $10.2 billion from the Central Bank's reserves and will draw billions more at year's end. PDVSA is also depositing about $100 million a week to the fund in addition to its tax payments. 70 percent of this money has been allocated for infrastructure projects and 25 percent for social spending.

But the government has not established any rules for the use of supervision, control and auditing of the fund. There is no check on where the allocated amount is being spent. Recently the Ministry of Finance announced that the fund money would be used to purchase Russian machine guns.
Additionally, the Fund's method of taking "excess" foreign reserves from the Central Band reserves could lead to currency instability.

Jose Rojas, former miniser of finance and former vice prseident of PDVSA feels that the government should be redistributing wealth through tax policy, while using oil money to "create real growth via better productivity and higher employment... otherwise you're just spending money."

While some believe that the investments in education, health and infrastucture will have a lasting effect on the standard of living, skeptics say the anti-poverty programs are not sustainable solutions and will vanish when the oil money is gone.

The purchasing power of the poor may have increased without a proportionate increase in the standard of living.

Despite the fact that even supporters of Chávez confess that the socal programs are not working as they should, the common man seems to believe that as long as Chávez is in power, things can get better.

Read

Picture Courtesy: www.flickr.com

Britain tried to prevent Nobel Laureate for Peace, El Baradei from getting a third term in charge of the UN's nuclear inspectorate.

El Baradei is the man leading the international campaign to stop Iran's nuclear weapons program.

Though El Baradei was elected unopposed with overwhelming international support in the absence of any credible rivals, classified documents reveal that Blair's government refused to commit itself to supporting his bid for another term at the helm of the International Atomic Energy Agency.

A source at the Department of Trade and Industry said that the government was following the Americans in the belief that El Baradie was not being tough enough on the Iranians.

Read

Picture Courtesy: www.flickr.com

PG & E Corps.'s Pacific Gas and Electric utility has signed a contract with Luz II LLC to buy at least 500 megawatts of solar energy that will power up to 350,000 customers, beginning in the spring of 2010.

Luz is waiting for approval on its plans to build hybrid solar-gas design plants that can dispatch electricity all day.

PG & E currently plans to add 300 megawatts of renewable electric power, including wind, solar and geothermal, a year to its supply. The company currently has 12,000 solar customers who generate about 88 megawatts of solar electricity.

PG & E shares rose to $41.55 on the NYSE.

Read

Picture Courtesy: www.flickr.com

Alternative Energy Sources Inc. has signed a letter of intent to acquire all of Flex Fuels USA Inc.'s outstanding capital stock and expects to sign a merger agreement by Sept. 15 that will given Alternative Energy access to Flex Fuel's proprietary ethanol production technology.

Flex Fuels has developed methods of producing cellulosic ethanol made from biomass waste streams rather than corn or sugar, making it less vulnerable to supply and price fluctuations and giving it the lowest cost position in the industry.
By merging with Alternative Energy Sources, Flex Fuels hopes to commercialize this technology.

Alternative Energy Sources, which develops, builds and operates ethanol production plants, plans to build the first cellulosic ethanol facility in the US.

Mark Beemer, Alternative Energy's CEO, said that by adding cellulosic ethanol to their portfolio in addition to the greenfield plants and carbohydrate based ethanol evaluation of sites, will provide great diversification to the company's future ethanol production base.

Read

Picture Courtesy: www.flickr.com

Modine Manufacturing Co., a Racine-based thermal management products form, announced that it is entering the second phase of a project with Chevron Corp. to develop a way of generating hydrogen on-site for use in automotive fuel cells.

The project aims to produce hydrogen at low cost and of a quality suitable for fuel cell applications. Chevron is working to develop and commercialize fuel-processing technology to convert resources such as natural gas into hydrogen.

Chevron Hydrogen Co. designed and built a purified hydrogen unit that will be used in a hydrogen refueling station. Modine has developed an advanced steam methane reformer that will be incorporated into the unit.
Chevron plans to install the unit at a US military base in Selfridge, Mich., to provide hydrogen for a fleet of light duty fuel cell vehicles in the summer of 2007.

Read

Picture Courtesy: www.flickr.com

US oil fell by as much as $1.05 to $75.30 after Britain said that it had foiled a plan to blow up an aircraft in trans-Atlantic flight. Security in Britain and the United States has been stepped up.

There was a simulataneous rise in safe haven bonds and fall in stock markets. Equity markets also fell as investors shifted to government bonds.

The news managed to rein in oil prices that had risen after the shutting down of the Prudhoe Bay Field production.

Energy portfolio manager, Craig Pennington believes that at times of uncertainty people become risk averse and that causes a broader sell-off resulting in the price shift.

Oil demand may be further affected if people's confidence suffers. US gasoline and heating oil fell down but these might be temporary effects with the big question being what the oil demand situation will be like.

Terrorism concerns and the need for the security of supply premium in the oil market might keep the market balanced.

Oil has risen by 25 percent this year due to the war in Lebanon, supply disruptions in Nigeria and Iraq and the uncertainties over Iran's nuclear program.

Read

Picture Courtesy: www.flickr.com

Carrizo Oil & Gas Inc. has reported a 43 percent profit decline in its second quarter.
Sharply higher costs offset modest revenue growth to cause the net income of the company to drop to $2.6 million from $4.5 million.

Earnings totaled 9 cents per share in the recent quarter. Though revenue edged higher to $16.5 million from $16.4 million from the previous year, total costs and expenses climbed to as much as $13.5 million.

Though the company's oil production volume slide to 42,645 barrels from 60,326 barrels in the 2005 quarter, its average oil price continued to jump from $55.07 to $66.35.
Natural gas production rose and so did Carrizo's average gas price to $6.88 per thousand cubic feet per share.

Production fell from the first-quarter levels due to mechanical problems, natural reserve declines and pipeline infrastructure delays.

Read

Two representatives of the UN Environment Program were finally able to evaluate the consequences of the oil spill in Lebanon.
UN Executive Director said that despite the complex political situation, it is appalling that more than 3 weeks into a crisis that is looking to rival the 1999 Erika tanker spill, there has been no move towards a clean-up or support given to the Lebanese government for an on-the-ground assessment.

If all the oil contained in the bombed power plant leaks into the Mediterranean Sea, this spill will be comparable to the Exxon Valdez disaster of 1989.

Though the two experts getting to assess the disaster in Syria is a start,much more needs to be done.

The UNEP is working with the UN Office for the Coordination of Humanitarian Affairs, the European Commission and the International Maritime Organization to create conditions under which remedial action over the oil spill can be taken.

With 140kms of the coastline already affected, many marine species such as sea turtles and bluefin tuna are thought to be severely affected.

Read

Picture Courtesy: www.flickr.com

Israeli bombing has so destroyed all the roads and bridges leading to Tyre that the South of Lebanon has been left without vital humanitarian aid. The UN is looking at possible sea routes to bring in supplies.

The UN Interim Force in Lebanon is looking at repairing the bridge across Litani river, but is first seeking guarantees from Israel that it would not be destroyed again.

Due to the poor conditions of roads owing to raids, the major alternative route does seem to be directly by sea to Beirut, Sidon and Tyre. Even more alarmingly, UN World Health Organization has said that chronic shortage of fuel shipments could lead to closure of 60 percent of hospitals.

Despite difficulties, emergency trucks from Syria and UN High Commissioner for Refugees are heading into Lebanon.

Though the UNHCR has been successful in reaching provisions to Beirut, logistical constraints and bombing bridges has caused them to delay further supplies till Thursday.

The UNDP has distributed hygiene kits and other essential supplies while the UN Population fund has been helping the Red CRoss home the displaced.

About a quarter of the country's population have been forced to flee their homes. The UN Relief and Works Agency has been keeping trackof the displaced who are seeking asylum in schools that it runs in Lebanon.

The UN appeal for $149 million for humanitarian use in Lebanon has received only $41 million in donor contributions and commitments so far.

Read

Picture Courtesy: www.flickr.com

A lawsuit, filed in 2004, that accuses energy companies of reporting false information to publishers of price indices to manipulate the market during the state's energy crisis of 2000-2001, has reached an interesting place with a San Diego court ruling that 27 energy companies must hand over taped conversations of natural gas traders.

Plaintiff attorney Joseph Cotchett hopes that he can use the tapes to show a pattern of manipulation that pushed natural gas prices in California to 10 times the national average.

Transcripts of conversations of the natural gas traders are laden with expletives and call Californians "a bunch of hippies" who deserve high utility bills because stringent enviromental regulations kept the number of power plants in the state low.

The 16 plaintiffs with separate suits are seeking damages that could reach a total of $3 billion.

55 percent of California's power plants are fuelled by natural gas. So, increase in natural gas prices causes an increase in the price of electricity.

The defendants include EnCana, Duke Energy Corp., Reliant Energy Inc, Sempra Energy and Dynegy Inc.

A transcript of a conversation shows a couple of gas traders talking about whether they could get caught manipulating prices.

Read

Picture Courtesy: www.flickr.com

In April, Iranian President Mahmoud Ahmadinejad, had suggested strengthening the OPEC fund to decrease the pressure of rising oil prices on poorer countries while ensuring that rich nations paid the full price.

Iran's oil ministry is now studying the presidential proposal to sell cheap crude to poor countries. However, the proposal would take some time to come through as parliamentary approval is required for any cuts in the crude export prices.

80 percent of Iran's export earnings are from energy exports.

Venezuelan President Hugo Chavez has been notching up cheap oil export deals around poor countries  in the Caribbean and Central America in a bid to counter US influence through cut-rate energy exports.

Ahmadinejad has formed a strong alliance with Hugo Chavez who strongly opposes the US Free Trade Area.

Read

Picture Courtesy: www.flickr.com

White Energy Ltd, formerly known as Amerod Resources, placed 23.98 million shares on the Australian, Asian, United Kingdom and US markets. The company raised $3 million over its $20 million target.

White Energy enhances poor quality coal to increase energy efficiency.

The company plans to expand its presence in the Asian coal producing markets including utilizing sub-bituminous coal reserves in Indonesia and China.

Read

Due to the 400,000 barrel a day Prudhoe Bay Field oil loss, Saudi Arabia and Mexico have pledged to supplement any shortage in the US.

The Energy Department stated that BP's oil field shutdown for corrosion maintenance might not be functional until January.

White House spokesman Tony Snow said that no refineries have reported shortages yet and in the event that there are any, the governement is willing to tap into the Strategic Petroleum Reserve and take up Mexico and Saudi Arabia on their offer.

When accused by Democartic Senator Charles Schumer of a lack of oversight, Snow stated that the discovery ofcorrosion was owing to the inspection rules laid down by the Bush administration.

A team of government investigators is assisting BP in assessing the situation.

When asked if Bush was concerned about the impact on prices, Snow said that the root cause needs to be addressed which is this case is to have the pipelines working in a way that is environmentally sound.

Read

Picture Courtesy: www.flickr.com

Central New York might soon have a 'green' power plant to provide cheaper energy to the city and school district and also work towards lowering pollution.

The Siemens Corp. is planning to build the plant which will use willow trees to extract energy. The process for extraction is called gasification and willow trees are a sound choice for it owing to the fact that they can be harvested within 3 years of planting.

Mayor Driscoll said New York would sign a 20-year contract to buy power from the plant which is projecting savings of 30 percent over current electricity rates. Siemens is still awaiting approval from the Syracuse Common Council and environmental permits.

The proposed facility will also significantly reduce carbon pollution to the tune of if 40,000 cars were removed from the road.

Siemens has also built a gas-fired plant for Monroe County and a gasification plant in Georgia that extracts gas from carpet scraps!

Siemens is partnered on the New York green plant project by the State University College of Environmental Science and Forestry that will help Siemens acquire fuel for the plant.

Read

Picture Courtesy: www.flickr.com

In a TV program, Iran formally defied UN's nuclear resolution.

The UN Security Council had asked for Iran to stop enriching uranium but Iran is going to go ahead and increase its program.
Despite failure to secretly import uranium from the Congo, Iran plans to brazenly pursue its nuclear proliferation plans.
Ali Larijani said that all of Iran's nuclear technology will be expanded including the centrifuge cascades for uranium enrichment.
When questioned about the balance of power in the Middle East with fears of the region breaking into a wider war and apprehensions that Iran does not plan to use its enrichment program merely to power fuel stations but to make nuclear weapons, Iranian President declared that Iran has joined the club of nuclear countries.

Tehran assures that it would not like to use the oil weapon and that the measure is being forced upon them by the double standards of countries that allow nuclear technology to some and not to others.
Iran being OPEC's second largest oil exporter states it should be allowed to defend its rights in proportion to its stance.

It is to be noted that the elimination of nuclear weapons features no where in international plans.

Read

Picture Courtesy: www.flickr.com

With the corrosion of pipelines in Prudhoe Bay Field, the nation's largest oil field and the subsequent halting of oil shipments from BP PLc, the world's second largest petroleum company, oil prices have risen by $2.22 a barrel.

The Prudhoe Bay Field accounts for 8 percent of all U.S. oil production and serves the West Coast and its loss is most likely to affect California and neighboring states.
This new crisis will add to the already creeping inflation and further slow down growth in the US.

The corroded pipelines are an environmental threat and the extent of the problem became known when BP announced that 16 of their 22 Alaskan pipelines need to be replaced.

The shutdown of production could go on for months and will reduce US oil production by 400,000 barrels a day. Though the Bush government has come up with an alternative for refineries by offering oil from the 688 million barrels of Strategic Petroleum Reserve, analysts feel that it would be very difficult to ship that much oil to the West Coast in the absence of a pipeline.

A spokesman from the Energy Department however said that the high crude oil inventories would serve the refineries and there was no immediate need to dip into the Reserve. Despite this, gasoline prices are expected to rise by few cents or more a gallon.

There has been disagreement among experts about the impact of the Alaskan shutdown.
While few believe that the present loss would be a mere "blip" if supply of heavier crude oil from Saudi Arabia was stepped up for West Coast refineries, most experts are of the opinion that prices can be expectedto rise by $10 to $15 and that the longer the field remains shut, the higher the prices would go.

The situation has drawn a lot of negative attention on BP, which reported record earnings in the second quarter but has allowed extensive corrosion of a pipeline of such importance to the country.

Officials said that the oil pipelines being shut down were clogged by sludge buildup which may have prevented the most sophisticated internal corrosion tests.

While a device called a "scraper pig" was used to clean out the pipes of sludge in 1992, it is unclear whether another device called the "smart pig" which can detect pipeline abnormalities was used.

BP Alaska President said that the company is already in the process of adjusting their corrosion program.

Bob Slaughter, president of the National Petrochemical and Refiners Association, has a hopeful addition in that the US recovered from last year's hurricane caused supply disruption and "that was worse than this."

Read

Picture Courtesy: www.flickr.com

New York Governor, George Pataki, who has been upping his own presidential aspirations for 2008, offered a 10-year energy plan on the same day as the Prudhoe Bay Field pipeline problems.

He called for tax credits to give incentives to auto makers to produce fuel-efficient cars and development of alternative fuels like ethanol from corn through a combination of tax incentives, loan guaantees and legislative changes.

He said oil's perpetual ties to terror, instability and environmental deterioration makes the reduction of petroleum consumption a matter for immediate and priority action.

His speech was briefly interrupted by the Transit Workers Union shouting out that he was to blame for the strike that paralyzed New York's subway and bus system last year.

Read

Picture Courtesy: www.flickr.com

OPEC President Edmund Daukory says that oil prices will probably remain $70 a barrel till the end of 2006.

The oil cartel has enough spare capacity to keep the market supplied with crude and Daukoru claims that the international oil market was overreacting by keeping prices close to record level.
Keeping in mind the ongoing Lebanon crisis, start of hurricane season in the US, threat of inflation and the loss of sweet oil from Nigeria coveted by US refineries, the prices are unlikely to drop below $70 a barrel.

OPEC has the capacity to produce more than 2.5 million barrels a day if required, placing the cartel in a comfortable position.

Despite violence in the Middle East, OPEC has no plans of meeting prior to their scheduled meet in Vienna in September.
Daukoru claims that the present situation requires no OPEC emergency response.

Read

Picture Courtesy: www.flickr.com

Make your home more energy efficient for not just long-term savings, but short-term tax benefits.

Energy saving home improvements made between December 31, 2005 to Jan 1, 2008 will get you tax credits which are more beneficial than deductions as they represent a dollar-for-dollar reduction in your tax bill.

Here's what's available:

Energy-efficient improvements: The credits for this are limited to improvements on your primary home but cover a lot of things such as leaky windows.The credit is for 10 percent the cost of eligible improvements and has a lifetime upper limit of $500. There are also specified limits on specific improvements.

Simple moves like buying an energy-efficient air conditioner or installing more insulation can help you claim credit.

Making your property energy efficient by installing solar energy will also give you tax credits. But these have annual caps and will need to be extended beyond 2007 for continued benefits.
Installation of solar-powered hot water systems in even vacation homes is elegible for tax credits.
You can even carry over your unused credits.
To qualify for these, you need to meet the complicated definitions in the bill but fortunately, you can rely on the manufacturer to determine whether the product meets federal standards.
You need to consult with your tax preparer and figure out the tax credits your state offers.

Read

Picture Courtesy: www.flickr.com

Iran's chief nuclear negotiator, Ali Larijani has said that Iran will continue with its nuclear program keeping within the bounds of the Nuclear Non-Proliferation Treaty and called the UN resolution imposing curbs on Iran illegal.

Read

Picture Courtesy: www.flickr.com

China National Offshore Oil Corp announced that it has entered full production at a disputed oil field in the East China Sea.
Japanese officials are verifying the report and on confirmation will lodge a formal complaint with Beijing demanding the company immediately halt the drilling.

If the demand is rejected, Japan plans to retaliate by drilling at a site near the median line between the two countries.

Japan would prefer to solve the dispute diplomatically and enourage further gas talks to repeat their proposal for joint exploration.
China has rejected previous proposals to jointly develop the fields and the talks held last month in Beijing failed to make progress.

Read

US Energy Secretary announced that that the governemnt will provide risk insurance against bureaucratic and legal issues to spur companies on to construct 6 nuclear power plants.
Nuclear power plants have not been built in the US sine 1973, and a partial plant meltdown in 1979 put an end to costruction of new ones.
The new incentive plan will provide $500 million in coverage for the first 2 plants and another $250 million for the remaining 4.

Read

Qatar Petroleum and Royal Dutch Shell PLC have come together to launch an integrated Pearl Gas-to-Liquids project in Qatar.
The project will involve construction of the world's largest integrated GTL complex and include development of Qatar's North Field's natural gas resources and their transport and processing for extraction of natural gas liquids and ethane, and the conversion of remaining gas into clean liquid hydrocarbon products.
1.6 billion cubic feet per day of gas is expected to produce about 120,000 barrels of oil equivalent per day of ethane and condensate, liquefied petroleum gas.

Read

Picture Courtesy: www.flickr.com

The oil spill that had been caused by Israeli jets hitting a plant in Lebanon and polluting over 80 kilometers of Lebanon's coastline has spread to the neighboring Syrian coastline.

The environmental disaster is threatening fish spawn and sea turtles, including the endangered green turtle.

An environmental catastrophe is looming over the entire Mediterranean region... and hostilities must be suspended to allow immediate access to the affected areas.

Read

Picture Courtesy: www.flickr.com

With the unveiling of the Tesla Roadster which is to hit the market in a year for the price of a Porsche 911, the lies of the oil lobbyists come to the fore.

The Roadster looks great, has a top speed of 130mph, GPS navigating, air conditioning and... pretty much everything a real car would. It's also 100 percent emissions free.

It's not a prototype, it's not a hybrid, it's not a fantasy... it's an honest to goodness street legal, drive worthy car and a symbol of how false the billion dollar corporations' claims are that we still need foreign oil.

All the gainsayers have been proved wrong - you can replace the internal combustion engine, you can eliminate auto emissions without sacrificing performance and you can do it all without oil.

If the country had spent even a part of the $300 billion that has gone into Bush's war effort on the nation's energy infrastructure, like encouraging the development of the Roadster, the United States could be called the epicenter of innovation once again instead of serving as a poster for terrorist recruitment.

The best part is that Tesla is an independent company. It doesn't have to answer to any monoliths like ExxonMObil or GM and says that any sales of the sports car will go to help propel its core technology further and make mass production more feasible.

The car does need a lot of electricity, which we have enough trouble producing, owing to all the years spent lying about how oil is irreplaceable.

Read

Picture Courtesy: www.flickr.com

Despite the Iran-US face off on the nuclear issue and the threat of sanctions against Iran, the country is not having trouble finding buyers in the present climate of rising world demand and strain of supply from some regions like Nigeria.

While India and Royal Dutch have supplied their need for oil by buying from Iran, Japan has trimmed its purchases from Tehran in lieu of the nuclear standoff by buying about 40 percent less from the previous quarter.

Other importers though have not been so picky during this oil shortage and detrimental repercussions of dropping a supplier have also stopped hands.

With 1000 civilian dead and 3000 injured, the war between Israeli forces and Hezbollah doesn't look like it's flagging.
Each side is trying to emerge victor but while Israel needs to defeat the militants, Hezbollah only needs to survive to claim victory.
Israeli public is behind the war and the Prime Minister says the military campaign will continue till such time as the international peacekeeping force is deployed. The Hezbollah is not agreeable to the force.
The UN resolutions require Hezbollah to disarm, but it cannot be done through war only political means.
While there is fear that the present crisis could lead to international terrorism from Hezbollah and its patron, Iran, many international players are looking to Syria to break its ties with Iran, stop arming Hezbollah and go for political and economic reform.

Read

Picture Courtesy: www.flickr.com

Iran's decisions to retaliate to the UN demands by disrupting oil supplies from the Strait of Hormuz might backfire on them.

Political analyst, Saeed Laylaz, affirms that the Iranian public is not in a position to handle sanctions, self-imposed or otherwise.

Cutting off the $5 billion income a month that the country gets from the flow of crude oil will choke the country's budget.
The West could also retaliate by cutting the gasoline it exports to Iran who are dependent on other nations for more than a third of their gasoline due to lack of refining capacity and wastage.

This game could have more dangerous effect on producing countries than consuming ones since strategic reserves can be tapped to control the effect of rising prices.

Besides the Tehran Stock Exchange is already showing a dip in its index due to the nuclear issue hitting parts of the economy.
Energy companies are complaining of reduced profits in Iran as development is hampered by administrative delays, technical glitches and tough contract terms.

The economic isolation that the country is generating for itself can only prove harmful in the long term. And if the country follows through on its threats to attack tankers in the Strait of Hormuz, it could cause irreparable damage to the reputation it is trying to build as a benevolent player.

With the Iranian president counting on surging oil prices to finance his spending spree for many social programs the oil embargo might be the last weapon of choice in the Iranian arsenal.

Read

Pictue Courtesy: www.flickr.com

A small but growing group of consumers are willing to pay premiums over the energy costs to support renewable energy.

Around 23,000 Minnesota households paid 30 percent more than the previous year for electricity, 4,30,000 households bought green power and utilities in 36 states offer some kind of green pricing.

Individuals like Rev. Francis Galles, living on a retired priest's income pays an extra $60 a year and is willing to pay more to see that at least some of the energy he uses is powered by wind turbines.
He feels he is doing his part in furthering a vision for the future of energy.

Progressive states and utilities are needed to lead the way in educating consumers about renewable energy sources.

While volunteer efforts are appreciated and programs like Capture the Wind are making great inroads in the use of wind energy as an alternative source some environmentalists wonder how much they can do to help without additional laws to back them up.

A Minnesota law requires utilities to offer customers the option of green pricing - customers can check a form and choose to have a certain portion of their energy in renewable energy. While the green energy isn't necessarily delivered to the customer, the utilities generate an amount equivalent to the purchase.

Read

Picture Courtesy: www.flickr.com

President Obasanjo of Nigeria has declared that despite the heavy oil prices, Nigeria would diversify the country's energy resources to include domestic nuclear power to be used for peaceful purposes.

As Obasanjo inaugurated a board for the Nigeria Atomic Energy Commission, he affirmed that the country's aspirations for nuclear power were completely peaceful and that he had hopes for utilizing nuclear energy for the generation of electricity.

He maintained that Nigeria is a credible and responsible player within the international community and would abide by all the international benchmarks while setting up the nuclear plant for electricity generation.

Obasanjo first initiated the use of atomic energy for peaceful purposes in 1976 when he was a General in the military, but his idea could not take off until he himself became an elected president.

Read

Picture Courtesy: www.flickr.com

Oil prices rose to new highs of 76 usd as traders watched tropical storm Chris in fear of it developing into a hurricane and damaging rings and refineries on the oil-rich Gulf Coast.

The much hoped for cease-fire in Lebanon also seems like a distant possibility with Israel killing 11 more people and capturing 3 Hezbollah fighters.

Further dissent in the Iranian nuclear matter has also caused the sudden climb in prices as well as concern that Iran and Syria, both backers of Hezbollah, are ordering troops to 'raise readiness'.

Iran's supreme leader Ayatollah Ali Khamenei has called on Muslims everywhere to resist US and Israeli aggression as Iran refuses to bend to the UN deadline and stop uranium enrichment.
In the event that sanctions are imposed against Iran, it is likely that the country might retaliate by blocking the Strait of Hormuz, which is a essential outlet for oil shipments to the US.

While the key issue in the oil price matter is supply instability, it is also expected that the inventory data will show a huge draw in US fuel stocks with high demands despite the $3 gallon prices.

Read

Picture Courtesy: www.flickr.com

Tom Benson, the man who owns the world's largest laundromat has done more than provide a place with 153 washers, 148 dryers and 15 flat screen TVs. On top of his laundromat sits the country's largest and most cost-effective solar system.

Since laundromats depend largely on water, its accounts are greatly affected by how energy efficient it is.

Benson says that when his heating bills started climbing to as much as $13,000 per month, he started thinking. After receiving a grant from Illinois, he set up his solar system which saves him $25,000 annually.

Though the cost of a solar system prevents many smaller laundromats from investing in it, Benson's model can be taken as a glowing example of how sun energy is practical, simple and cost efficient.

Read

Picture Courtesy: www.flickr.com

Due to instability in oil-producing regions and higher energy demands in China and India pushing crude oil costs higher, the Senate moved closer to passing a Bill that would make 8.3 million acres in the Gulf of Mexico available for oil and natural gas drilling.

The Bill will allow drlling in coastal waters, a move that has invited major opposition from enviromental groups.

Advocates of the bill, say that it is an oppotunity for America to increase its domestic supplies of energy and that the debated area contains enough natural gas to heat and cool 6 millions homes for 15 years.

The area of the Gulf ofMexica has been under a drilling ban for a quarter of a century. The ban covers 85 percent of America's coastal areas.

Some lawmakers have taken issue with the fact that the bill specifically prohibits drilling between 125 miles and 230 miles of Florida's shore until 2022 while awarding royalties to four Gulf states that allow drilling. There is also a clause in the bill for revenue-sharing which would result in 37.5 percent of revenues being given to the Gulf states.

While manufacturers have expressed strong support for the bill, critics claim that the legislation's impact on oil prices will be negligible considering the high levels of demand.

Read

Picture Courtesy: www.flickr.com

Retail investors belive that energy will remain the most profitable investment sector over the next 6 months. A large number of the respondents said they are willing to stash their money in energy.

A survey of 600 American clients by the US discount brokerage firm around July 11 to 18 found that 51 percent were already invested in energy.

But the odds of energy stocks leading markets higher are diminishing with US economic growth slowing down to 2.5 percent in the second quarter, its slowest pace since 2005.

The price of oil has tripled in the last 4 years. With companies in the US and Canada basking in record profits and seeing share prices rally, there is talk of a permanent era of high energy prices.

The demand for oil stocks is likely to ensure that prices remain high. The survey showed that people consider consumer goods, telecom and software as more risky investments than the energy sector.

In the last month, 45 percent have not changed their portfolios, 30 percent have moved into stocks and 24 percent have moved out. Of the 24 percent that moved out, at least 50 percent shifted their assets to money market and savings, 9 percent to real estate, 7 percent to mutual funds and fixed income and 4 percent to exchange traded funds and stock options.

Read

In the present state of the oil economy with consumers bearing the brunt of the high prices, the race for an aternative fuel is back on.

The successful contender will need to be cheaper than gasoline, be available in large quantities and have smaller greenhouse-gas emissions than gasoline.

With so many considertaions, it could be a while yet before any alternative fuel will ever cross the line ahead of gasoline.

The leader of the competing pack right now is ethanol made from corn. Economically sound, it is believed that even if price of gasoline drops below the current levels and that of corn rises, it will still be cheaper to buy a gallon of ethanol than gasoline.

The price buffer is essential as history has not favored alternative fuels. In the 1980s gasoline prices were at a record high and alternative fuel programs were encouraged. But when the oil prices plummeted, most of the other fuels became non-competitive resulting in heavy losses.

The one problem with ethanol made fromcorn in the short supply of corn in the U.S.  Other materials are being tested for the production of ethanol. Some estimate that switchgrass could quadruple the output of ethanol from a single acre. Also if the U.S lowered import barriers for sugarcane, used heavily in Brazil, the future of ethanol fuel would really look up.

Turning cellulose-based materials into ethanol is a promising alternative but needs to be tested at a full-scale production level.

Another burgeoning option is methanol from coal. So far, methanol has been made from natural gas, but the US has vast coal reserves and the production cost for methanol would be as low as 40 to 50 cents a gallon. Indy cars have been using Methanol directly as a fuel and it can also be used as a rich source of hydrogen for fuel-cell vehicles. Methanol can also be used for the production of biodiesel.
The one drawback is the large amount of greenhouse gases released while producing methanol from coal.

While other fuels like compressed natural gas and liquefied natural gas are in use, the race seems to be between three types of fuel - ethanol from cellulose and sugarcane, methanol from coal and electricity from the wall outlet.
Using electricity is efficient, cheap and would cause far less pollution than gasoline.

Finally, trends in the automotive industry may decide the winning formula.

Read

Picture Courtesy: www.flickr.com

Will we ever say 'fill 'er up' and mean with Hydrogen? The San Diego Unified School District is going to work towards that.

The district has recently won a grant of $1.25 million to design and build a hydrogen fueling station for educating school children and the public about renewable energy.

District officials want to put 'the technology of the furure' out there so that people can understand it and think of pursuing careers in the field of renewable energy.

The project which is the first of its kind by a school district is yet to be approved by the San Diego School Board. It also needs to be extensively talked about to put to rest parents' concerens over safety.

Some school board members too are concerned over safety and would prefer to have the station further away from the proposed Marshall Middle School site.

JoAnn Millken, acting manager of the hydrogen program at the U.S Department of Energy said safe systems can be engineered to produce, store and use hydrogen and that it is no more unsafe than gasoline when handled appropriately.

The station will have solar panels connected to an 'electrolyzer' that produces hydrogen from water and will be able to dispense 39 kilograms of hydrogen per day.

The hydrogen station is expected to grow to include other green features like wind turbines and composters. That move would take more time and require outside funds.

The present project is partnered by private companies and will serve not only the needs of the district but also the nearby Miramar Marine Corps Air Station.

Given the limited capacity of the station and the number of hydrogen powered vehicles on the road, traffic is not expected to be an issue in the area.

J. William Naish, the district's energy/utility management section coordinator brought solar energy onto the roofs of city schools, got old refrigerators replaced by energy-efficient ones and has now come up with the idea for the hydrogen station.

If built, it will the crowning achievement of the district's energy conversation program which has already garnered appreciation for its state-of-the-art energy efficiency standards in building new schools.

Read

Picture Courtesy: www.flickr.com