Saturday 28 December 2013

My 5 Favorite Books of 2013

These are books I read in 2013, they weren't necessarily published in 2013. I have no idea how books 'should' be written, so my judgement is based on how engaging they were. I suspect that Isaacson is a very good biographer, but I suppose the content might be driving my interest. Either way. Here are my five favourite.

How Good We Have It!

Friday 20 December 2013

Alberta Pipeline Update

(photo credit: Transcanada)

It's been a busy past couple of weeks on the Alberta pipeline front. Positive (and negative) news has an added inertial positive feedback effect on the other projects which adds some added interest to each incremental step. We know Obama has stipulated that XL's impact on GHG emissions will be a key determinant of approval. Which can be read as: whether or not the oil sands be developed at a significantly reduced rate with or without it. Every time we get closer to moving that bitumen by other means, we get closer to Obama's approval.

Wednesday 18 December 2013

Implications of Mexican Oil Reforms

Mexico: The Recent News

As a primer, the first thing you need to know about the Mexian oil industry is a single name: Petroleos Mexicanos, more commonly refereed to as PEMEX. Formed in 1938 via the expropriation of all foriegn oil entities by President Lazaro Cardenas, Pemex has had an effective monopoly on all matters oil & gas in Mexico since.

The Mexican senate passed, on Dec. 12, additional (to the 2008 amendments allowing third party service contracts) amendments to articles 25, 27, and 28 of the constitution which forbade private sector contracts and outlawed non-Mexican entities from the energy sector.  While details on taxation, royalty, and the legal framework within which foreigners can enter the market are still to come, the immediate details appear to be a pretty radical turn away from historical norms.

Sunday 15 December 2013

The Peak Oil Dynamic in the Globe and Mail

I'm not sure if I've seen an article that nails down the issues on both sides of the oil market so concisely in a proper publication as this one. Eric Reguly nails it in the Globe and Mail. We've got the decline rates of existing conventional fields, the relative expense of unconventional production, the export land model phenomenon, and the elevation of price to a more central role in the conversation.

Here are a few of the highlights, but give the entire article a read it's short.

Eric Reguly: Inexpensive Oil Vanishing at Alarming Rate (Globe and Mail).

Saturday 14 December 2013

Inequality does not equal Inequality does not equal Inequality.

A bit of a rant coming on here. I'd consider myself politically libertarianish/liberal. By which I mean, I think governments do have a role to play, both in facilitating well markets and stepping in for markets where they aren't efficient. Conservatism has kind of been hijacked in the US to the point where I'd probably be considered a true Democrat in that black and white world (and would certainly have voted Obama in the last couple of elections). But that's not how I'd describe myself.

Monday 9 December 2013

Developed Economies (formerly) Falling Consumption: Stagnation or Efficiency?

We'll probably have to wait a few more years before we can make a confident pronouncement but in the following Platts article the data seems to suggest, as I speculated in this post, that the decline in developed world oil consumption was more due to economic decline/stagnation then efficiency gains and substitutions.

The article is suggestive of some other interesting trends, namely the slowdown in China's and the developing world's consumption growth. ** Notice, that's slowdown in growth, not a decline.**

Thursday 5 December 2013

Book Review: The China Development Bank: Debt, Oil and Influence

The China Development Bank (CDB), in 2010 held $687 Billion in loans. Over twice as much as the World Bank. And I knew almost anything about it prior to reading this book by Henry Sanderson and Michael Forsythe:

China's Superbank: Debt, Oil and Influence - How China Development Bank is Rewriting the Rules of Finance

My main interest was loan-for-oil financing. This is a topic I've been following over the last few months. Info is hard to come by, but as this post outlined, China has been securing oil supply as repayment for debt. Sometimes via the NOC's, but sometimes it's the Export-Import Bank (EXIM) and other times it's the CDB. But these deals are everywhere.

Monday 2 December 2013

Build it and they will come (because that's how China rolls!)

Quiet: Despite claims on its website that tourists can be spirited away to far-flung locations including Sydney, Dubai and Cologne, no airlines actually appear to offer services to or from any of these cities

This story, asking: "Will China's new hi-tech airport prove to be a flight of fancy?" popped on my Google News Feed this weekend and it just got me to thinking about the western world's fascination with China's ghost anything.

IEA's 2013 World Energy Outlook Summary

The IEA has published their 2013 World Energy Outlook and in it they raise some interesting issues going forward. Unfortunately, I don't have access to the full report (paywalled here). However, the Executive Summary does sketch out the main points.

All in all, the message is pretty similar to the world view encapsulated in the definition of the Peak Oil Dynamic (as I've described it) where the supply side (and falling demand in the developed world) faces significant challenges to maintain pace with the developing world's growing appetite for oil.
The centre of gravity of energy demand is switching decisively to the emerging economies, particularly China, India and the Middle East, which drive global energy use one-third higher.