The Crude Oil Export Ban - What, Me Worry About Peak Oil?  

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Art Berman has an article in Forbes on the ending of the crude oil export ban in the US - The Crude Oil Export Ban--What, Me Worry About Peak Oil?. It's quite amazing just how much oil the US still imports after 10 years of the shale oil boom.

Congress ended the U.S. crude oil export ban last week. There is apparently no longer a strategic reason to conserve oil because shale production has made American great again. At least, that’s narrative that reality-averse politicians and their bases prefer.

The 1975 Energy Policy and Conservation Act (EPCA) that banned crude oil export was the closest thing to an energy policy that the United States has ever had. The law was passed after the price of oil increased in one month (January 1974) from $21 to $51 per barrel (2015 dollars) because of the Arab Oil Embargo.

The EPCA not only banned the export of crude oil but also established the Strategic Petroleum Reserve. Both measures were intended to keep more oil at home in order to make the U.S. less dependent on imported oil. A 55 mile-per-hour national speed limit was established to force conservation, and the International Energy Agency (IEA) was founded to better monitor and predict global oil supply and demand trends.

Above all, the export ban acknowledged that declining domestic supply and increased imports had made the country vulnerable to economic disruption. Its repeal last week suggests that there is no longer any risk associated with dependence on foreign oil.

Developer of $20 million Australian-first solar thermal pilot plant predicts sunny future under Turnbull  

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The ABC has a report on a new solar thermal pilot plant using sodium for energy storage in New South Wales - Developer of $20 million Australian-first solar thermal pilot plant predicts sunny future under Turnbull.

The Australian company has developed what it hopes will be a low-cost, high-efficiency Concentrated Solar Power (CSP) generation technology. The Jemalong pilot plant will be ready for commissioning in mid-January and is designed to prove the technology works.

Peak oil losing credibility as renewables shift accelerates  

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The ABC has a report on the decreasing levels of belief in peak oil (with Shane Oliver predicting peak oil will be due to consumption shifts not supply limitations) - Peak oil losing credibility as renewables shift accelerates.

AMP's Shane Oliver believes that, rather than facing a peak oil shock, consumers and industries will continue to move away from fossil fuels in an orderly manner as a wider range of renewable technologies get closer to affordable reality. "What's going to happen is that oil production globally will at some point peak but it's going to be because the world has moved away from oil towards the use of other things," Dr Oliver told AM. "The electrification of automobiles and greater efficiency in the use of oil will drive a decline in the demand through time anyway."

Dr Oliver said that, rather replicating a shock in the 1970s when OPEC restricted supply, the globe is undergoing a quiet revolution that will see the world requiring less oil. "Only a decade ago I was being told that I've got to get rid of my car and replace it with a horse and buggy. That prospect appears as less likely," Dr Oliver said. "The reality is the days of the internal combustion engine using oil are numbered, and I won't be getting rid of the car and getting a horse and buggy - I'll perhaps be getting a car with an electric engine."

BioPower wave power unit deployed in Southern Ocean  

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Many years ago I wrote about a company looking to exploit ocean energy using biomimicry. REW reports a pilot project has finally gone live - Victoria’s first wave power unit deployed in Southern Ocean.

Another Australian-designed wave energy project has been deployed, with the completion this week of the 250kW bioWAVE pilot demonstration unit off the Victorian coast near Port Fairy.

The $21 million project has been in development by Sydney and US-based company, BioPower Systems, for three years, with $11 million funding from the Australian Renewable Energy Agency (ARENA) and $5 million funding from the Victorian Government.

Earth has lost a third of arable land in past 40 years, scientists say  

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The Guardian has an article on soil depletion - Earth has lost a third of arable land in past 40 years, scientists say.

The world has lost a third of its arable land due to erosion or pollution in the past 40 years, with potentially disastrous consequences as global demand for food soars, scientists have warned. New research has calculated that nearly 33% of the world’s adequate or high-quality food-producing land has been lost at a rate that far outstrips the pace of natural processes to replace diminished soil.

The University of Sheffield’s Grantham Centre for Sustainable Futures, which undertook the study by analysing various pieces of research published over the past decade, said the loss was “catastrophic” and the trend close to being irretrievable without major changes to agricultural practices. The continual ploughing of fields, combined with heavy use of fertilizers, has degraded soils across the world, the research found, with erosion occurring at a pace of up to 100 times greater than the rate of soil formation. It takes around 500 years for just 2.5cm of topsoil to be created amid unimpeded ecological changes.

Animating the changing shape of the world population pyramid  

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From Peter Winfield (via The Economist) - Animating the changing shape of the world population pyramid.

Australia’s fearless flanker David Pocock shows sport and politics can mix  

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The Guardian has an article on Australi's highest profile global warming activist and the player who is most likely to determine if we win the rugby world cup tonight - Australia’s fearless flanker David Pocock shows sport and politics can mix

At the start of this week the story broke that Pocock had signed an open letter calling on world leaders to discuss a ban on new coal mines at the United Nations climate change meeting in Paris this December. His was only one of 61 signatures, along with the likes of novelist Richard Flanagan and the nobel laureate Professor Peter Doherty. But, five days out from the biggest game of Pocock’s life, his was the name in the headlines. And because it was there, the story had a reach that it wouldn’t have had otherwise.

It wasn’t the first time. Last November, Pocock was one of a group of protesters who broke into the coal mine at Maules Creek in New South Wales. He, and they, were all with the group, a grassroots movement which aims to reduce the amount of CO2 in the atmosphere from its current level of 400 parts per million to below 350 ppm.


Are there owls ?  

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Saudi oil: Peak conspiracy  

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James McIntosh at FT Alphaville has a look at all the theories that could be applied to Saudi oil production strategy, including their belief in (or otherwise) peak oil - Saudi oil: Peak conspiracy. Options listed include:

  • an attack on US shale
  • a secret deal with the US to hurt Russia
  • a “political plot” against regional rival Iran
  • trying to pressure the Russians to cut off Bashar al-Assad in Syria
  • a change in the Saudi view on peak oil

A conspiracy to stiff gas consumers ?  

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Michael West has an article in the SMH posing the question "are rising Australian domestic gas prices the result of a conspiracy" - A conspiracy to stiff gas consumers.

Coal prices have crashed, the carbon tax has gone, yet the cost of electricity continues to rise. Oil prices have halved, yet the price of gas, which is linked to oil, is going up 17 per cent.

This used to be a country which thrived on an abundance of low-cost energy. Now virtually every consumer and every business is shackled by spiralling energy prices. ...

About 34,000 homes had their electricity cut off and there were more than 24,000 who had their gas cut off. There is a vicious circle in this, because the fewer people there are on the grid the more the networks charge each customer to recoup their costs.

And charge they do. Even as inflation has ebbed in recent years, and even as actual demand has receded too, the networks have kept pushing regulators for their 10 per cent returns. ...

The gas lobby has been running the line, talking about a "cliff" in gas supply. Unless new coal seam gas projects were urgently bought on the east coast would literally run out of gas. This scare campaign has been the impetus for the dramatic rise in gas prices.

Yet there is no hard evidence for it, because the gas cartel does not reveal even to the government how much there is in the way of gas reserves or what is actually contracted and at what price.

It is no secret though that, despite Australia's enormous reserves, prices have been driven up by the rush to export the stuff to Asia. Local consumers are being forced to pay international prices and the producers have diverted supply to the Gladstone plants to be turned into LNG and shipped offshore.

That, too, is now unravelling. Credit Suisse sallied forth with a report this week which pointed out gas prices had halved, in line with plunging oil, and that the Gladstone LNG projects were in financial disarray.

Personally I'd find it ard to blame rising gas prices on anything other than the linkage of domestic prices to the international export market - as long as Asian prices are higher than domestic prices once were, we'll have to pay out more. The only real solution to this, as a coalition of manufacturers have argued, is reserving a percentage of gas production for the domestic market and regulating the price (then ignoring the howls from the gas producers about missing profit opportunities). In the longer run solar power will make the issue largely irrelevant, other than for industries that need gas as a feedstock.

The SMH had an earlier article talking about the effect of exports on local prices - Local gas prices set to soar as exports to Asia get under way.

In late December, British energy giant BG Group sent the first ever shipment of liquefied natural gas from Australia's east coast, using gas from the state's booming coal seam gas industry. Granted, it sounds far removed from everyday life for most of us. But this cargo load is the start of a trend that will dramatically increase how much households pay for gas used for hot water, cooking, or heating.

It is predicted to push up many households' utility bills by a similar amount to the carbon tax, but there are no plans for compensation. And as you'd expect with a jump in the cost of living of this size, this one is producing some seriously flimsy economics.

First though, back to that shipment. Not only was it the first time that CSG has been converted into LNG, the exportable form of gas. More importantly for consumers, it was the first time gas has been exported from the east coast of Australia at all, and there is much more to come. Origin Energy and Santos this year also hope to start pumping cargo loads full of the stuff, to be sold to buyers across China, Japan, Korea, Malaysia and other Asian nations.

Economists are keeping an eye on these projects – and others in WA – as there are predictions they could make Australia the world's biggest exporter of LNG by 2018, overtaking Qatar. LNG looks set to become our second biggest export behind iron ore. But what will affect households directly is how this massive new industry transforms the domestic gas market.

Now that the east coast is able to export gas (WA has been doing it since 1989) producers have the option of selling to buyers in Asia, who are willing to pay much, much more for it than we have been.

Historically, the east coast gas market was insulated from the rest of the world, and the domestic wholesale price was stable at about $3 to $4 a gigajoule. Now, there are buyers across Asia prepared to pay $12 or $13, even when energy markets are in turmoil as they are at the moment.

ReNew Economy has an article on the dismal future for natural gas fired power generation - Record low solar prices heralds power shift from fossil fuels.

It should be a little ironic – given the dramatic plunge in the oil price that is said to have been driven by Saudi Arabian supply tactics – that a Saudi company should set two global records for cheap solar power in the past two weeks.

But to energy analysts it is yet another sign of the energy transition taking place across the world, and one that could be accelerated, rather than slowed, by the collapse in the oil price because of the cancellation and deferral of tens of billions of dollars in uneconomic fossil fuel reserves.

ACWA Power, a water and power developer based in the Saudi capital Riyadh, last week won the world’s largest ever solar tender with the cheapest ever price for a large scale solar project.

It will build – with the help of Spanish group TSK and technology from US-based First Solar – a 260MWp solar PV plant at the Mohammed Rashid Al Maktoum Solar Park in Dubai, at a cost of just $US0.058/kwh, of $US58.4/MWh.

That’s how much it will receive as a fixed tariff over 25 years for what will be – for the moment – the largest solar plant in Middle East. The price it bid is 20 per cent cheaper than the previous benchmark for solar tenders. What’s more, it is 30 per cent cheaper than the price of gas that is currently used for nearly all of the electricity generation in the United Arab Emirates.

Makani: Google’s Energy Harvesting Kites  

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Cryptogon points to a new video on Google's Makani wind power kites (covered in one of the more popular posts here many years ago Alternative wind power experiments) - Makani: Google’s Energy Harvesting Kites.

Makani is working to accelerate the shift to clean, renewable energy by developing energy kites, a new type of wind turbine that uses lightweight electronics, advanced materials, and smart software to generate more energy with less materials—all at lower cost.

Kevin seems to have a love-hate relationship with Google, also pointing to this piece of investigative journalism on Medium - How the CIA made Google.

INSURGE INTELLIGENCE, a new crowd-funded investigative journalism project, breaks the exclusive story of how the United States intelligence community funded, nurtured and incubated Google as part of a drive to dominate the world through control of information. Seed-funded by the NSA and CIA, Google was merely the first among a plethora of private sector start-ups co-opted by US intelligence to retain ‘information superiority.’

The origins of this ingenious strategy trace back to a secret Pentagon-sponsored group, that for the last two decades has functioned as a bridge between the US government and elites across the business, industry, finance, corporate, and media sectors. The group has allowed some of the most powerful special interests in corporate America to systematically circumvent democratic accountability and the rule of law to influence government policies, as well as public opinion in the US and around the world. The results have been catastrophic: NSA mass surveillance, a permanent state of global war, and a new initiative to transform the US military into Skynet.

Why has nearsightedness more than doubled in 50 years ?  

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TreeHugger has a post on research into the increasing incidence of myopia - with lack of exposure to sunlight being a possible cause - Why has nearsightedness more than doubled in 50 years?.

Sixty years ago, 10 to 20 percent of the Chinese population was nearsighted, now up to 90 percent of teenagers and young adults have trouble seeing distance. In other parts of the world the story is similar: Half of the young adults in the United States and Europe now have myopia, double the number of half a century ago. And some are predicting that by 2020, one-third of the world’s population could be diagnosed with the condition. ...

But surprisingly, it’s not the reading and computers and smartphones that are to blame. Now researchers believe that it’s the very act of spending too much time inside that is causing the problem. After a great deal of research and eliminating other factors, scientists now think that it boils down to exposure to light. Regardless of what kids are doing – whether sports, or playing, and even those who continue to do “close work” (like reading) outside – what seems to be key is the eye's exposure to bright light.

So while our kids are losing their connection to nature – while they’re becoming increasingly unfamiliar with the feeling of grass underfoot, mud in the hands, the sound of birds, the smell of dirt – they’re also losing the ability to see.

France decrees new rooftops must be covered in plants or solar panels  

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The Guardian reports that rooftops on new buildings built in commercial zones in France must either be partially covered in plants or solar panels, under a law approved on Thursday - France decrees new rooftops must be covered in plants or solar panels.

The Changing Face of World Oil Markets  

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James Hamilton at Econbrowser started one of the year's more interesting peak oil debates back in July with a post on developments in the oil markets - The Changing Face of World Oil Markets.

This year the oil industry celebrated its 155th birthday, continuing a rich history of booms, busts and dramatic technological changes. Many old hands in the oil patch may view recent developments as a continuation of the same old story, wondering if the high prices of the last decade will prove to be another transient cycle with which technological advances will again eventually catch up. But there have been some dramatic changes over the last decade that could mark a major turning point in the history of the world’s use of this key energy source. In this article I review five of the ways in which the world of energy may have changed forever.

1. World oil demand is now driven by the emerging economies. ...
2. Growth in production since 2005 has come from lower-quality hydrocarbons. ...
3. Stagnating world production of crude oil meant significantly higher prices. ...
4. Geopolitical disturbances held back growth in oil production. ...
5. Geological limitations are another reason that world oil production stagnated. ...

Although the oil industry has a long history of temporary booms followed by busts, I do not expect the current episode to end as one more chapter in that familiar story. The run-up of oil prices over the last decade resulted from strong growth of demand from emerging economies confronting limited physical potential to increase production from conventional sources. Certainly a change in those fundamentals could shift the equation dramatically. If China were to face a financial crisis, or if peace and stability were suddenly to break out in the Middle East and North Africa, a sharp drop in oil prices would be expected. But even if such events were to occur, the emerging economies would surely subsequently resume their growth, in which case any gains in production from Libya or Iraq would only buy a few more years. If the oil industry does experience another price cycle arising from such developments, any collapse in oil prices would be short-lived.

My conclusion is that hundred-dollar oil is here to stay.

Reuters' John Kemp was moved to respond in disagreement - Kemp: Forecasts For Higher Oil Prices Misjudge The Shale Boom.

The shale revolution will turn out to be only a pause in the upward trend in prices, Hamilton argues, as growing demand from emerging economies and stagnant supplies from conventional oil fields push prices higher in the long term. "Rather than a force pushing oil prices back to historical lows, it seems more accurate to view the emerging tight oil plays as a factor that can mitigate for a while what would otherwise be the tendency for prices to continue to rise."

The problem with Hamilton's analysis is that it largely ignores the impact of the shale revolution on the economics of oil production and understates the tremendous variability in real oil prices in response to changes in technology. The professor devotes just 400 words out of almost 4,000 to discussing the production of crude oil and gas from shale formations.

Most of that discussion focuses on the high cost of drilling and fracturing shale wells; the rapid decline in production; the alleged unprofitability of shale wells; and question of whether the conditions that produced the shale revolution in North American can be replicated in other parts of the world. But this part of the paper is also the weakest, and it highlights the fundamental limitations with Hamilton's entire argument about the increasing difficulty and costs of producing crude oil.

Since 2008, the dramatic increase in oil and gas production from shale formations in North America, and the abundance of shale resources around the world, has discredited theories about peaking oil production. The simple theory that supplies will run out has been reframed as a more sophisticated one about rising prices.

Peak oil supporters now point to the increasing cost of oil production, diminishing energy return on investment and the diminishing energy return on energy invested to claim that it is becoming harder and more expensive to sustain, let alone increase, crude output. Prices must continue to rise in real terms, they say, to reflect the increasing cost of producing crude and to restrain demand. Price increases will prove to be just as disruptive as physically running out of the stuff.

Hamilton's paper lends influential support to this view. He notes that oil demand is now being driven by rising incomes in emerging markets, even as high prices restrain consumption in the advanced economies.

Platts then had a follow up post from Steve Kopits - Guest blog: Hamilton has it right on oil.

Kemp seems to be arguing that shale oil is a game-changer which will materially change the supply outlook and catalyze a fall in oil prices.

To test this assertion, it is worth asking if shale production has actually led to the predicted fall in oil prices. As is well known, the shale surge caused a divergence of the West Texas Intermediate (WTI) oil price, the US domestic standard, from Brent, the international standard. Historically, these two prices rarely diverged by more than a dollar or two. Notwithstanding, from late 2011, surging shale production depressed the WTI price as US supply outran domestic infrastructure capabilities, and government regulations prevented the export of US crude.

Have prices fallen since? Growth of field production in the lower 48 states has been impressive, increasing by 400,000 b/d in the 12 months ending in mid-2011, and rising to a gain of 1 million b/d by mid-2012, a pace it has held ever since.

How did prices react? In the three months ending July 2011, WTI averaged $98, falling to $88/b a year later. On the other hand, by July 2013, WTI was back to $98, and will close this July around $104. Has surging shale production caused the US oil price to collapse? Not all at. It has been accompanied by increasing oil prices, even in the US.

Nor has Brent collapsed. True, Brent averaged $115/b in the three months to July 2011, and fell to $103 just a year later. But it will close this July at about $111/b, not much different from three years ago, and higher than it was at the beginning of the “shale gale.” Shale oil has not led, as a statistical matter, to lower oil prices in the US—or globally—in the last two years.

How can this be, if the oil supply is in such fine fettle? Has peak oil really been debunked? Is Kemp right when he says: “Since 2008, the dramatic increase in oil and gas production from shale formations in North America, and the abundance of shale resources around the world, has discredited theories about peaking oil production.”

As the chart shows, just as many analysts have contended, the oil supply hit an inflection point in 2005. That year signals the high water mark of conventional crude and condensate production, which is 2.1 mbpd less than it was then.

Even if we include refinery processing gain, biofuels and NGLs (these latter two adjusted for energy content equaling about 70% of that of a barrel of crude), we find the oil supply is up only 0.4%, 300,000 b/d, compared to 2005.

Virtually all of the growth—92%, on an energy-adjusted basis—has come from unconventionals, specifically, Canadian oil sands and US shale (tight) oil. Indeed, 70% of the net growth of the global oil supply from 2005 through 2013 came from US shales alone. Shales are not the icing on the cake; they are the cake itself.

This matters, because shale production in turn depends overwhelmingly on only two plays, the Eagle Ford and the Bakken, where production is expected to peak in 2016 or 2017 or see much slower growth in production as the sweet spots there are exhausted. The Permian Basin may pick up the slack, but to date has not done so in needle-moving quantities.

Meanwhile, lagging oil prices are calling into question a number of oil sands projects, particularly those slated to begin production after 2020. Unconventional growth may well be approaching its high water mark. If 1 million b/d growth has led to higher oil prices, what will happen when unconventional growth slows to 300,000 b/d in two or three years?

And there’s more. Kemp states: “North American shale is currently the marginal source of supply in the world oil market, and most producers claim they can break even at $70 or even $60 per barrel.”

It is not clear that the US independents are profitable. An industry can see a boom irrespective of profits or free cash flow if banks and investors are willing to underwrite the promises of future profits. The internet bubble showed us that.

We do not yet know if shale oil and gas will be consistently profitable. We do know, however, that US independents have been massively free cash flow negative in recent years.

D Ray Long has a postscript to the debate - Geology Is Crushing Technology.

In July, I highlighted James Hamilton's paper "The Changing Face of World Oil Markets," as well as the critical response from Reuters writer John Kemp. But I didn't circle back to also highlight Steven Kopits reply to Kemp that appeared in Platts: "Hamilton has it right on oil."

You should definitely read the entire thing, but here's a short quote below on Capex. Kopits discussed the capex issue in great detail in his Columbia University presentation earlier this year (and if you haven't seen that, then go watch it immediately). But the short and simple version: Oil companies are spending more money, while gaining less production. Here's Kopits:

"...productivity of capital has deteriorated by a factor of four, from $5,300 capex b/d of oil production in 2004 to $21,400 in 2013. This deterioration is net of technology improvements. Geology is not only winning, it is crushing technology.

Hamilton’s graph testifies to the grizzly unraveling of the economics underpinning oil production since 2005. For the oil business as a whole, productivity has imploded, not improved."

Total global solar heads for 200GW, 50GW in 2014  

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RNE has a look at the global solar power market - Total global solar heads for 200GW, 50GW in 2014.

Total global solar installations are well on the way to the 200GW mark, with the amount of PV added in the fourth quarter of 2014 forecast to fall just short of 20 gigawatts at 19.5GW, according to new data.

According to findings in the latest NPD Solarbuzz Quarterly, the amount of solar PV deployed worldwide in QSB_Q4 Solar PV Demand and Year-End Cumulative Installed PV_1410064 is forecast to be equivalent to the energy supplied by five large-scale nuclear power plants and will surpass the total annual solar PV deployed in 2010.

Global Oceans Break All-Time Heat Record; World on Pace for Warmest Year Ever  

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Slate has a look at the latest global warming data - Global Oceans Break All-Time Heat Record; World on Pace for Warmest Year Ever.

The Earth’s oceans have never been this far beyond the bounds of normal.

New data released Thursday by the National Oceanic and Atmospheric Administration showed that Earth’s oceans reached a level last month not seen since humans have been keeping comprehensive records. Global ocean temperatures in August 2014 warmed to “the largest departure from average for any month on record” according to a NOAA statement. The previous record was set just two months ago, in June 2014.

The NOAA data also showed the temperature of the Earth as a whole hit a new all-time August record last month, confirming similar results earlier this week from NASA and the Japanese Meteorological Agency, which use slightly different ways of crunching the numbers.

Additionally, the combined temperature of June, July, and August was also unprecedented in historical records. According to the JMA, four of the last five months have now been record-breaking for that particular month. (July was No. 2, just a hair behind the super-charged El Niño year of 1998.) The eastern United States is among the only land areas on Earth still running below normal for 2014, a legacy of the polar vortex outbreaks of earlier this year.

Later Thursday morning, NOAA expanded on the implications of the new records in a conference call, saying that on its current pace—and with the help of a newly resurgent El Niño—2014 is poised to become the warmest year ever measured.

CitizenFour: Documentary Film Claims That There Is Another NSA Leaker with Higher Rank Than Snowden  

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The Hollywood Reporter has an article on a documentary about Edward Snowden - Documentary Film Claims That There Is Another NSA Leaker with Higher Rank Than Snowden.

A second National Security Agency whistleblower exists within the ranks of government intelligence.

That bombshell comes toward the end of Citizenfour, a new documentary from filmmaker Laura Poitras about NSA informant Edward Snowden that had its world premiere on Friday at the New York Film Festival.

In the key scene, journalist Glenn Greenwald visits Snowden at a hotel room in Moscow. Fearing they are being taped, Greenwald communicates with Snowden via pen and paper. While some of the exchanges are blurred for the camera, it becomes clear that Greenwald wants to convey that another government whistleblower — higher in rank than Snowden — has come forward.

The revelation clearly shocks Snowden, whose mouth drops open when he reads the details of the informant’s leak. Also revealed by Greenwald is the fact that 1.2 million Americans are currently on a government watch-list. Among them is Poitras herself.

Adrift in Oil Country  

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TomDispatch has an article on life in the Bakken - Adrift in Oil Country.

I hadn’t driven nearly 2,000 miles from Brooklyn to work as a cocktail waitress in a strip club. (That only happened after I ran out of money.) I had set off with the intention of reporting on the domestic oil boom that was reshaping North Dakota’s prairie towns as well as the balance of both global power and the earth’s atmosphere.

This spring, production in North Dakota surged past one million barrels of oil a day. The source of this liquid gold, as it is locally known, is the Bakken Shale: a layered, energy-rich rock formation that stretches across western North Dakota, the corner of Montana, and into Canada. It had been considered inaccessible until breakthroughs in drilling and hydraulic fracturing made the extraction of oil from it economically feasible. In 2008, the United States Geological Survey (USGS) announced that the Bakken Shale contained 25 times more recoverable oil than previously thought, sparking the biggest oil rush in state history.

Now, six years later, the region displays all the classic contemporary markers of hell: toxic flames that burn around the clock; ink-black smoke billowing from 18-wheelers; intermittent explosions caused by lightning striking the super-conductive wastewater tanks that hydraulic fracturing makes a necessity; a massive Walmart; an abundance of meth, crack, and liquor; freezing winters; rents higher than Manhattan; and far, far too many men. To oil companies, however, the field is hallowed ground, one of the few in history to break the million-barrel-a-day benchmark, earning it “a place in the small pantheon of truly elite oil fields,” as one Reuters market analyst wrote.

We're Sitting on 10 Billion Barrels of Oil! OK, Two  

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Bloomberg has a look at the tendency to over-hype shale oil reserves - We're Sitting on 10 Billion Barrels of Oil! OK, Two.

Lee Tillman, chief executive officer of Marathon Oil Corp., told investors last month that the company was potentially sitting on the equivalent of 4.3 billion barrels in its U.S. shale acreage. That number was 5.5 times higher than the proved reserves Marathon reported to federal regulators.

Such discrepancies are rife in the U.S. shale industry. Drillers use bigger forecasts to sell the hydraulic fracturing boom to investors and to persuade lawmakers to lift the 39-year-old ban on crude exports. Sixty-two of 73 U.S. shale drillers reported one estimate in mandatory filings with the Securities and Exchange Commission while citing higher potential figures to the public, according to data compiled by Bloomberg. Pioneer Natural Resources (PXD) Co.’s estimate was 13 times higher. Goodrich Petroleum Corp.’s was 19 times. For Rice Energy Inc., it was almost 27-fold.

“They’re running a great risk of litigation when they don’t end up producing anything like that,” said John Lee, a University of Houston petroleum engineering professor who helped write the SEC rules and has taught reserves evaluation to a generation of engineers. “If I were an ambulance-chasing lawyer, I’d get into this.”

Germany Reaches 74% Renewable Energy During May Weekend  

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Inhabitat has a look at Germany's increasing takeup of renewable energy - Germany Was Powered by 74% Renewable Energy Last Weekend.

According to think tank Agora Energiewende, Germany’s renewable usage set a new record on Sunday when wind, solar, biomass, and hydro energy supplied a bulk of the country’s energy. Information supplied by the group shows that the combined contribution of renewables reached 43.54 gigawatts between noon and 1 p.m. That equates to almost three quarters of the country’s demand.

Agora Energiewende has noted, however, that the inability of some baseload generators to switch themselves off meant that a record level of more than 10 gigawatts of surplus capacity at its peak was exported to neighboring markets.

Germany has always been among Europe’s leaders when it comes to solar energy, and this weekend was no exception with its output at 15.2 gigawatts at its peak. That said, the output is just half its rated peak capacity—which is more than 33 gigawatts—but then most of the northern part of the country was covered in cloud.




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