In the survey form for ranking the top 10 stories of 2007, we asked if there were any subjects in our 40-odd story offering that we had missed. A box was presented to those who took this option, a canvas for offering their opinions.
One subject was raised by three different people: the decline of production at Mexico's Cantarell field. One of the responders noted the precise decline in output at Cantarell this year: a decline of 14.1% from the 1.4 million b/d produced in in 2006. So far, nitrogen injection has been used to stem the decline of Cantarell, but the success has been limited. If there was a reason why it wasn't on our list of top stories of 2007, it was only that the precipitous output decline started in 2006, and we viewed it as a story from that year, not this year. But there's no doubt about it: the 14.1% decline in 2007 is big news.
There were several suggestions that could have fallen under the offering of "Supply/demand constraints, Peak Oil theory grains traction." For example: "T. Boone Pickens declares we aren't going to get any more than 85 million b/d." Another in that vein: "Declining export story begins to gain traction." And another: "From Peak Oil to a dark age," citing a Business Week story by that title. All of them get at the basic story of a tightening supply/demand balance that is unlikely to show much movement on the supply side. But the fact is, we did offer something like that as an option, and it was our number 2 vote-getter.
Resource nationalism was cited by two separate commentors, one of whom referred to the "Putin aggressive natural resource policy made explicit." Similarly, one responder said the "biggest story that went unnoticed" was the sale of the GE plastics division" to Saudi Basic Industries (SABIC), an $11.6 billion transaction that was described as "another example of the increasing trend toward resource nationalism." True, but it's not really an oil story.
In one three-pronged suggestion from a person who saw some non supply/demand forces behind the rise in prices, a responder said our choices had skipped "the correction in oil prices due to the depreciation of the dollar over the last four years; the bid-up in oil prices due to speculation by hedge funds; the refinery 'maintenance' issues which caused an early suge in gasoline prices." The quotes around maintenance came from the responder, not from us. The decline of the dollar and its impact on oil prices was mentioned by one other responder.
One commenter said our description of the US government buying oil to fill the Strategic Petroleum Reserve was incorrect: "The federal government exchanges Gulf of Mexico RIK (Royalty in Kind) oil, it does not buy it." Technically correct. But the federal government otherwise would be taking that RIK oil and selling it on the open market.
If ExxonMobil takes its company's equity crude and refines it in its system, the refining and marketing division must account for that acquisition through an internal transfer price that for accounting purposes is the same thing as an open market purchase by the division. What the federal government is doing is not precisely the same; the Department of Energy takes RIK crude gathered by the MMS and stuffs it into a salt cavern, and no money changes hands. But by not allowing the MMS to sell RIK crude, it defers revenue it would have had otherwise. The buyer that might have purchased the RIK oil now needs to go elsewhere to fill its crude needs. The difference between this and an actual purchase is not much more than semantics.
So we'll change our description to say that the US government has resumed its filling of the Strategic Petroleum Reserve. But in terms of its impact on supply and demand, it's no different than if it was buying the oil.
And then of course there were the wise guys who suggested that Paris Hilton going to jail was the biggest story of the year.
Platts wants to thank everyone for taking the time to either respond to the survey, and to make additional comments where they saw something missing.
Peak oil is a con-job on America. I wish you guys would
investigate a little more on the subject of oil and natural gas in America.
Back in 1976, on Gull Island, Alaska, the biggest and largest oil and natural gas pool in North America, possibly the world, was discovered. The US govt. immediately classified the find and told all the parties in the discovery to keep their mouths shut. Lindsey Williams, a baptist minister who was given the > job of catering to the men's religious needs, working on the Alaska pipeline,
became very close to Ken Fromm, a senior CEO of Atlantic Richfield Oil Company.
Ken showed Lindsey Williams in 1976, the stats on the 3 oil wells they had drilled on Gull Island, Alaska and told him, that this find was enough to last America for over 200 years, the next day ken told him he had to keep his mouth
> shut, the US govt. had classified the find. Mr Williams, kept quiet for a few years, but decided that he couldn't do it any longer. He wrote a book back in 1980 called "The Energy Non-Crisis", 20 chapters in length, it can be accessed on the internet and read for free by typing on google search Lindsey Williams, the oil on Gull Island, Alaska. You will get several hits.
The first hit is about Gull Island, the second hit is Lindsey Williams book "The Energy Non-Crisis" scroll down a little bit and you will see the 20 chapters, click on each chapter and read the book. You also can get 8 speeches by Lindsey Williams YouTube by typing on their search engine Lindsey Williams. This information has been in a few newspapers, such as the American Free Press, and a few other small news papers. It has been on Coast to Coast talk radio and Lindsey Williams has been speaking around the country for 30 years telling this story. This has not been mentioned on any major media outlet.
This story has got to be the biggest fraud in the history of America, because Americans are paying billions of dollars they should not be paying. Lindsey Williams says that if that oil in the Gull Island area was brought down to the lower 48 states, within one year the price of oil would drop below $1.50 per gallon at the pump. You check with the Energy Dept. and their EIA and all they keep saying is there is limited oil and energy in the North slope of Alaska, so they have to be in on the con job. I wish that everyone would research this subject and write an article about it and send it to their congressmen. Thank You, Jack Faulk.