longoil

The Fundamentals of Oil Shocks

I am impressed by James Hamilton, an economist that actually understands the pricing dynamics of oil. Jeff Rubin, an other well known economist, also concurs that oil prices were driven by supply and demand and in particular the spectacular growth in the Chinese economy.

Canadian Oil Sands: An Investment in Secure, Long-Life Oil

There certainly seems to be alot of potential consolidation of oil sands assets.

SU has taken over PetroCanada.
Shell could potentially take over the assets of PWE.
COSWF is certainly in the driver's seat in regards to the COP oil sands assets. COP has a hugh debt load and is currently selling off a lot of assets like its LNG terminal recently.

Climate-Gate Awareness Grows

I have to question Al Gore's real motives.

His global warming crusade is making a lot of green for him. He gets a minimum of $100,000 for every 90 minute talk his gives on global warming. No wonder he did not want to run again for president in 2004 nor in 2008 and get only a measely $200,000 / year salary.

www.thesmokinggun.com/...

You would think someone worth $100 million would do these talks for free, especially if he really believes in climate change.

Furthermore, look at Gore’s accomplishments with Clinton from 1993-2001. The CAFE standard was in good hands with Ford, Carter, Reagan and Bush 41. It rose from 15 to 27 mpg during1975-1992. Clinton and Gore (Mr. Earth in the Balance) were pandering for UAW votes in the 1990's and they introduced the light truck exemption that killed CAFE (for Jeeps, Hummers, SUVs and Minivans) and it is now flat at 27 mpg.

The real motive for Gore’s climate change crusade is to make more money for himself. His company GIM owns 10% of the Chicago Climate Exchange.

wapedia.mobi/en/Chicag...

Climate-Gate Awareness Grows

Gore has alot of nerve. He was up in Canada blasting the oil sands complaining about all the CO2 emissions. He failed to mention that all the US coal fired power plants generate 100 times the CO2 that all the oil sands projects put together do.

According to the Nashville Electric Service, his mansion pays a electric bill ten times that of the average Nashville resident. What a hypocrite, his carbon foorprint is ten times that of an average American.

High Gold Prices: It's the Oil, Stupid

Fitz,

The easy ways of testing (e.g. density, electrical resistance) for counterfeit precious metals can all be fooled.

Drilling out a sample can identify fake precious metals but is destructive. Gold is malleable like lead and tungsten is very brittle.

There is non-destructive sophisticated techniques using the paramagnetic properties of the metal. Gold is diamagnetic, tungsten is paramagnetic. Diamagnetism appears in all materials and is the tendency of a material to oppose an applied magnetic field and paramagnetic is the tendency to enhance a magnetic field.

More info can be found here:

forums.silverseek.com/...

High Gold Prices: It's the Oil, Stupid

It looks like you can't even trust gold bullion in 400 ounce bars anymore either. Several gold bars shipped to Hong Kong from the Bank of London were not really gold but gold plated tungsten (which has same density as gold)

www.marketoracle.co.uk...

Bright Future for Petrobras and Brazil, Part 2

National oil companies have historically allowed the multinationals to develop their reserves and then nationalized the foreign assets and expelled the multinationals after local engineers gained enough experience to run the show. This has happened in Mexico in 1938 attempted in Iran in 1951 (until the CIA intervened and propped the pro western Shah) and successfully done by the Middle Eastern nations in the 1970's.

Chavez also kicked the majors recently in 2005, but to his detriment. Most Venezuelan engineers don't have heavy oil extraction expertise and if they do they are working in western Canada earning big bucks in the oil sands [rojects. Most educated Venezuelans I speak to are surprisely very anti-Chavez. His power base rests with the uneducated and poor.

In the case of Brazil, I think Lulu is smart enough to realize that Brazil cannot undergo a long term deep sea master plan on their on own and has learned from the lessons of Chavez and the tragedy of Canterell double digit depletion in Mexico. The danger still lies in the future, where some potential Brazilian dictator could kick out the majors in the future.

Bright Future for Petrobras and Brazil

Soldama,

There is uncertainty no matter where you invest in oil and gas.

1 ) Russia and China have similar potential government interference issues as Brazil. Look what happened in Venezuela, Chavez nationalized foreign assets and shot himself in the foot at the same time. Venezuela petro-engineers are well versed in light-sweet oil production, but lack experience with heavy-sour oil (where the bulk of Venezuelan future production will come from)
2) Europe and Canada have the potential for adding hefty carbon taxes to gas and oil production.
3) The United States will probably punish oil companies with windfall taxes (especially with the Democrats in charge). This is why companies like Exxon and Chevron with amazing balance sheets are trading at incredibly low valuations.

Bright Future for Petrobras and Brazil

Prairiedog,

I agree Yahoo and most other websites are useless when evaluating foreign companies.

Check out the Mcdep.com website.
Kurt Wulff (SA contributer) does a nice job of analyzing US, Canada, European, Brazilian, Chinese and Russian oil and gas companies in detail..

Bright Future for Petrobras and Brazil

Petrobas is definitely a nice company to have in your portfolio.

They are the world leaders in ethanol production, where it makes a substantial percentage of the transportation fuel used in Brazil. Sugar has a positive EROI (7 x higher than corn). Corn ethanol which is advocated in the US has a negative EROI and it only use is to buy farming votes in the Midwest.

Petrobras oil fields have a nice long reserve life of 14 years.

RIG and DO are also good investments that benefit from the deep sea drilling projects Brazil has in the Atlantic. RIG, DO and other deep sea drillers get paid where or not the wells are successful or dry.

Gordon Currie on Where to Invest in Energy Right Now

Environmentalists like to label fossils fuels as pure evil, but aside from the obvious economic benefits, fossil fuels have provided many other benefits to humanity.

Prior to Colonel Drake successfully drilling oil in Pennsylvania in 1859 which was used for kerosene for illumination, oil lamps were filled with oil from sperm whales which were almost hunted into extinction had the petroleum age not begun in the 1860's

Similarly, the end of slavery coincides with the introduction of the industrial age where coal fired steam machniery replaced human labor. With the introduction of Watt's steam engine in 1776, the British had abolished slavery by 1833. In the US, coal had as much to do with the liberation of slaves, as did Lincoln in 1865.

Stephen Schork: More Upside in Oil

I agree with blu,

These high priced reports from Schork and other "experts" like Yergin at CERA had a good track record of being wrong 95% of the time.

home.entouch.net/dmd/c...

I stick with my experts (i.e. Simmons, Pickens, Campbell, Laherre, Deffeyes, etc) that actually got their hands dirty in oil fields and know that Peak Oil is a reality.

Canadian Oil Sands Trust Is Now the Single Most Attractive Oil Acquisition Target

COSWF did in fact increase the dividend payment for November 2009, but it went up only 40% from 25 cents /unit to 35 cents /unit, not 100% as Kurt predicated. Although, in the long run I think Kurt's predication is on the money.

www.cos-trust.com/news...

It's Going to Get Ugly

Fitz,

Your dream of auto NG outlets in every home will never happen.
Gas that feeds your home is considered a necessity (for heating and cooking) and is taxed lightly. How will the government tax (or should I say overtax) NG that is used to fill your car from the same connection ? Yes, you could add a separately metered device for filling cars, but we know many clever people simply attach their Phill to the lower taxed heating and cooking outlets. Goverenment does not care about energy indepedence, but rather a nice revenue stream (i.e. gasoline tax) to pay special interest grousp (banks, auto manufactureurs, etc.)

ConocoPhilips: Time to Embrace Natural Gas Transportation

Fitz,

I am not anti-NG, just not too crazy about badly managed companies like COP and CHK.

I choose to play NG through better managed companies like BP, RDS, TOT, CVX, ECA and XOM..