AuthorTopic: US Energy Sources and Uses Show Limits of Renewable Energy Strategies  (Read 11044 times)

Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #30 on: September 03, 2014, 10:05:01 PM »
The one problem with the new plastic cars that run on batteries is :
LITHIUM IS FRICKIN POISONOUS TO HUMANS

That is only one of numerous problems.

Besides that you have an aging electric grid that is progressively deteriorating and couldn't handle the increased load of a complete turnover to EVs.

Then you have a road network with increasing maintenance costs and decreasing revenues to maintain it.

After that you have a population tapped out on credit to buy any type of automobile, ICE or EV.  The only way they are keeping any carz moving off the lots is to offer 0% Loans to subprime borrowers, which will go the same way the subprime RE market went.

Then you have all the fossil fuel energy currently utilized in mining Lithium and manufacturing the batteries and the replacement issue.

After that is the lack of a recharging infrastructure, limiting the total range and utility of the vehicles.

There may be a small number of EVs plying ever worse roads for a while after the gas becomes unavailable or outrageously expensive at the pump, but it is doubtful that period will last too long.

RE
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Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #31 on: September 04, 2014, 01:00:38 AM »

Quote from: Moriarty
And no one has even mentioned Haliburton, what with their 60+ years of experience doing this horrible, debt laden, stock value destroying..thing?  :icon_sunny:

Why don't you present Halliburton's Annual Report with your analysis and we can discuss it.  Thanks.

RE

Just for shits & "giggles" I went and Googled up Halliburton's Financials through 2013

Financial Information

Comparative Highlights
(Millions of dollars & shares, except per share data) 2013 2012 2011 2010
Revenue $29,402 $28,503 $24,829 $17,973
Operating Income 3,138 4,159 4,737 3,009
Amounts Attributable to Company Shareholders:        
Income from Continuing Operations 2,106 2,577 3,005 1,795
Net Income 2,125 2,635 2,839 1,835
Diluted Income per Share Attributable to Company Shareholders:        
Income from Continuing Operations 2.33 2.78 3.26 1.97
Net Income 2.36 2.84 3.08 2.01
Cash Dividends per Share 0.525 0.36 0.36 0.36
Diluted Common Shares Outstanding 902 928 922 911
Working Capital1 8,678 8,334 7,456 6,129
Capital Expenditures 2,934 3,566 2,953 2,069
Long-Term Debt 7,816 4,820 4,820 3,824
Debt to Total Capitalization2 37% 24% 27% 27%
Depreciation, Depletion, and Amortization 1,900 1,628 1,359 1,119
Return on Average Capital Employed3 11% 15% 19% 15%
Total Capitalization4 21,569 20,764 18,097 14,241
 

Note that between 2012 & 2013, Long Term DEBT increased from $4820 to $7816 (in $Millions)
Note the Debt to Total Capitalization Ratio went from 24% to 37%
Note Return on Avg Capital employed DROPPED from 15% to 11%
Note INCOME from Continuing Operations DROPPED from $2635 to $2125

So basically Halliburton is a Poster Boy for exactly what Wolf Richter and the IEA is talking about here, their Income is DECREASING while their DEBT LOAD is INCREASING.

Big as they are, they can keep floating bigger Bond Issues...until they can't.  If you had decreasing salary and bigger debts, how long before the Bank forecloses on you?  Halliburton is in the TBTF category, so the Banksters keep issuing them a longer Credit Card line.  Because if/when they go Belly UP, it takes down the whole system.

A fabulous example here really of how unsustainable this bubble is.

RE
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Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #32 on: September 04, 2014, 01:30:03 AM »
Here is another article from Forbes on EOG Resources, another large player in the "Fracking Revolution", discussing how their financials do not reflect the reality of their costs. As is obvious, costs are concealed in order to make the Bottom Line look better.  Fraud basically.

RE

http://www.forbes.com/sites/stevebanker/2014/09/02/eog-resources-financial-presentations-come-up-short/

EOG Resources' Financial Presentations Come Up Short

I’ve been researching logistics issues associated with Unconventional Oil (oil from shale and oil sands).  Because of this, it was natural for me to go to EOG Resources annual report (10K) and the recent financial presentation on their web site.  After all, EOG is the largest onshore producer of oil in the lower 48 states and they claim to have the best “horizontal crude oil” (shale oil) assets in North America.

I’m defining logistics costs as consisting of transportation, warehousing, and inventory carrying costs.  These costs represent a substantial proportion of EOG’s total costs, and yet their discussion of how they are trying to control these costs was almost nonexistent. In their annual report, they break out the costs by category in different regions.  It makes sense to look at the U.S. cost structure, because their operations in the U.S. are both larger more mature than in other regions.

                               2013 Costs by                       % of Total
                               Category ($M)                            Costs                                

Exploration Costs      141,286                                            2.4%

Dry Hole Costs              14,276                                           0.2%

Transportation             841,567                                         14.5%

Production Costs        1,494,791                                        25.8%

Impairments                   178,718                                           3.1%

Depreciation,              3,122,858                                         53.9%
 Depletion
 and Amortization    ________                                         _____

Total Costs                    5,793,496                                        100.0%

Transportation, which they report as being 14.5% of total costs, are substantial for EOG.  In most industries transportation represents less than ten percent of total costs. However, the transportation costs reported here are not fully inclusive. The transportation costs EOG is discussing relate to the costs of getting product from a well to a downstream point of sale. In other words, outbound transportation.

The depreciation, depletion and amortization (DD&A) cost category also includes logistics costs. DD&A includes leasehold acquisition costs and the cost to acquire proved properties.  I don’t see significant logistics costs here.  It also includes the development costs and exploration drilling costs associated with successfully bringing a well online.  Because of the remote locations, lack of transportation infrastructure, and heavy equipment used, these costs would be substantial. Finally, it includes estimated future dismantlement, restoration and abandonment costs, which would also have a transportation component.

Production costs also have a heavy logistics element, even if those costs may be largely hidden from EOG because of the way many oil companies have structured their contracts with key suppliers.  Water, sand, production chemicals, piping and casing, and other materials must be transported in.  These are heavy commodities brought in on specialized equipment.  Water is often transported the last few miles by Mom and Pop local firms, who may not be highly efficient.  At well sites, you will see huge sheds filled with sand and drilling equipment.  So there are warehousing and inventory carrying costs here as well.

Some of these items – chemicals, piping/casings and related materials – are outsourced to well services firms.  Well services firms charge an oil company for their services inclusive of all costs, including logistics.  The well services industry, and I’m being charitable here, has a reputation for being backward in their supply chain management capabilities.  Many of these firms do not have a sales and operations planning process (S&OP), are deficient in forecasting, and consequently achieve high service levels by carrying piles and piles of inventory.  And those inventory carrying costs get passed on to their customers.  Based on this, a conservative estimate of the logistics costs associated with production category would be twenty percent.

This means at EOG, logistics costs as a percentage of total costs, must be at least 20% and could be several percentage points higher!

I want to be fair, logistics is talked about in their annual report:

  • EOG is an anchor shipper on the Enterprise Products Partners L.P. Eagle Ford crude oil pipeline and they also transport on a Kinder Morgan KMI -0.73% pipeline.  Transporting via pipe is much less costly than using rail.
  • EOG has large contiguous acreage position in some of their oil fields, this allows for lower logistics costs.
  • The company owns four crude oil loading facilities, one loading facility, and a sand storage and distribution facility near their Eagle Ford oil fields.  There must be efficiencies associated with these facilities.
  • EOG claims that their crude-by-rail infrastructure provides market flexibility.

And let’s also be fair, any oil company needs to spend time on investment calls talking about discovery, increasing production efficiencies, and for the many oil companies that are highly leveraged, debt retirement.

But logistics, a cost component, that conservatively represents at least 20 percent of total costs needs to be discussed in significantly more detail than what we are currently seeing.  EOG has two upcoming financial presentations on September 4th and the 18th. It would be wonderful if we could hear more about how they are trying to drive greater efficiencies in logistics.

« Last Edit: September 04, 2014, 01:35:53 AM by RE »
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Offline MKing

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #33 on: September 04, 2014, 03:07:58 AM »
The one problem with the new plastic cars that run on batteries is :
LITHIUM IS FRICKIN POISONOUS TO HUMANS

Fortunately, I didn't buy a CAR to eat it, take a bath with it, rub it on myself, or in any way interact with its battery beyond filling it up. And in exchange, during my families duty cycle,it delivers a solid 300+ mpg.

Obviously not that great of a number compared to what the two Leafs in the neighborhood are capable of, but mine can still run out of the suburbs to do a little elk hunting, should the need arise.
Sometimes one creates a dynamic impression by saying something, and sometimes one creates as significant an impression by remaining silent.
-Dalai Lama

Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #34 on: September 04, 2014, 03:15:30 AM »
The one problem with the new plastic cars that run on batteries is :
LITHIUM IS FRICKIN POISONOUS TO HUMANS

Fortunately, I didn't buy a CAR to eat it, take a bath with it, rub it on myself, or in any way interact with its battery beyond filling it up. And in exchange, during my families duty cycle,it delivers a solid 300+ mpg.

Obviously not that great of a number compared to what the two Leafs in the neighborhood are capable of, but mine can still run out of the suburbs to do a little elk hunting, should the need arise.

Meanwhile, it soaks up plenty-o-electrons from coal and nuke fired plants, and maneuvering around the potholes will be increasingly more difficult over time.

There is NO FREE LUNCH.

RE
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Offline MKing

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #35 on: September 04, 2014, 03:20:42 AM »
The one problem with the new plastic cars that run on batteries is :
LITHIUM IS FRICKIN POISONOUS TO HUMANS

Fortunately, I didn't buy a CAR to eat it, take a bath with it, rub it on myself, or in any way interact with its battery beyond filling it up. And in exchange, during my families duty cycle,it delivers a solid 300+ mpg.

Obviously not that great of a number compared to what the two Leafs in the neighborhood are capable of, but mine can still run out of the suburbs to do a little elk hunting, should the need arise.

Meanwhile, it soaks up plenty-o-electrons from coal and nuke fired plants, and maneuvering around the potholes will be increasingly more difficult over time.

There is NO FREE LUNCH.

RE

No electrons from nukes in my neighborhood. Reasonable amounts of coal, about even with cleaner burning natural gas. And 33% wind and solar.

People can complain about powering their cars using fuel sourced only 33% comprised of renewables….but want to bet it is far better than yours?

The folks who have me beat pretty handily though are the folks in the Pac NW and their hydropower….now THEY have something much better going on…if you don't count the free fuel I get locally from the roof top solar arrays popping up in more than a couple of the locations where I park the car to collect my free fuel.

No free lunch certainly, but free fuel…definitely!!
Sometimes one creates a dynamic impression by saying something, and sometimes one creates as significant an impression by remaining silent.
-Dalai Lama

Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #36 on: September 04, 2014, 03:35:55 AM »
=
No electrons from nukes in my neighborhood. Reasonable amounts of coal, about even with cleaner burning natural gas. And 33% wind and solar.

People can complain about powering their cars using fuel sourced only 33% comprised of renewables….but want to bet it is far better than yours?

The folks who have me beat pretty handily though are the folks in the Pac NW and their hydropower….now THEY have something much better going on…if you don't count the free fuel I get locally from the roof top solar arrays popping up in more than a couple of the locations where I park the car to collect my free fuel.

No free lunch certainly, but free fuel…definitely!!

Nonsense.  None of it is Free.  The solar arrays take copious fossil fuels to produce.  Hydro power has limitations that are quite obvious at Lake Mead and Lake Powell now.  Replacing the batteries will become ever more difficult and expensive.  The roads will deteriorate as fewer people can afford to use them and maintain them.  This is freaking obvious.  You simply ignore reality to commit further fraud in your chosen profession.  You are selling a lie.

RE
« Last Edit: September 04, 2014, 03:38:23 AM by RE »
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Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #37 on: September 04, 2014, 03:56:25 AM »
I am sure all Diners have Noted that in his responses in this thread, Moriarty did not provide any DATA to refute Wolf Richter's article with EIA data, the Halliburton Spreadsheet or the EOG non-disclosure of logistics costs.

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Offline Golden Oxen

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #38 on: September 04, 2014, 05:07:44 AM »

Grandma always used to say, if you wanna learn how to wrestle a bear, sooner or later, your gonna have to wrestle a bear. A somewhat demented "that which doesn't kill you makes you stronger" angle, but who can argue with someone who survived the Depression in Appalachia? That old bird taught me how to kill chickens, advocated to my anti-gun mother that "that boy is old enough for his first raffle..." when I was about 9...bought me my first briefcase upon graduation. Only grandchild to complete college, she was always proud of that.

How many times can you regurgitate your brag about being an Appalachian Horatio Alger? At least I keep my autobiographical articles down to 2 or 3 a year, you rehash Appalachia 2 or 3 times a week.   ::)

RE

Hi RE, I get your point so please don't take this the wrong way.

When you think about it MKing's rise from the horrors of his childhood and abject poverty, he was even homeless for a spell, really is an amazing feat. 

Perhaps his attitude and mannerisms on the Diner are caused by a need to get recognition for this amazing rags to riches story, which he cannot do elsewhere. It would be most difficult to toot his horn in his other world.

Whatever, he appears to stay with us, and I sincerely wish we could find a way to get his troll status removed.

 Don't let him fool you, he's a doomer and Diner just like the rest of us. Remember his "Something Just Isn't Quite Right" remark, which, of course, is a clever way to cover all the bases of his blabber should events prove him wrong.

I think Doomer Support said it best when he said something to the effect of, "Once you get by his attitude, he has a lot to offer."   Let's face it, he is no dunce, quite the opposite.

Just sayin.   

Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #39 on: September 04, 2014, 05:07:24 PM »

Grandma always used to say, if you wanna learn how to wrestle a bear, sooner or later, your gonna have to wrestle a bear. A somewhat demented "that which doesn't kill you makes you stronger" angle, but who can argue with someone who survived the Depression in Appalachia? That old bird taught me how to kill chickens, advocated to my anti-gun mother that "that boy is old enough for his first raffle..." when I was about 9...bought me my first briefcase upon graduation. Only grandchild to complete college, she was always proud of that.

How many times can you regurgitate your brag about being an Appalachian Horatio Alger? At least I keep my autobiographical articles down to 2 or 3 a year, you rehash Appalachia 2 or 3 times a week.   ::)

RE

Hi RE, I get your point so please don't take this the wrong way.

When you think about it MKing's rise from the horrors of his childhood and abject poverty, he was even homeless for a spell, really is an amazing feat. 

Perhaps his attitude and mannerisms on the Diner are caused by a need to get recognition for this amazing rags to riches story, which he cannot do elsewhere. It would be most difficult to toot his horn in his other world.

Whatever, he appears to stay with us, and I sincerely wish we could find a way to get his troll status removed.

 Don't let him fool you, he's a doomer and Diner just like the rest of us. Remember his "Something Just Isn't Quite Right" remark, which, of course, is a clever way to cover all the bases of his blabber should events prove him wrong.

I think Doomer Support said it best when he said something to the effect of, "Once you get by his attitude, he has a lot to offer."   Let's face it, he is no dunce, quite the opposite.

Just sayin.

If he wants recognition for his fracking prowess, he can write a book.  Or start his own Blog.  I didn't put up the Diner as a spot for insecure sociopaths to exorcise their Demons from the past.

Far as DS opinion, I don't agree with it.  I get more information in 2 minutes of Googling than in 2 years of innumerable postings by Moriarty which mainly are self congradulatory exercises in bragging mixed with sneering condescension.  He doesn't pass on worthwhile information here, he just sows discontent.

RE
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Offline MKing

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #40 on: September 04, 2014, 05:55:24 PM »
Nonsense.  None of it is Free.

Just as nothing is sustainable. But as long as people get to take advantage of the lack of perspective of others, as David Hughes finds perfectly acceptable, than you and I get to do the same.

I pull up to Kohls. I plug in. I am given FREE fuel, free as in, it costs me NOTHING.

You would call that FREE. I certainly do. The other EVs fueling up…for FREE…would say it is free.

Certainly there are COSTS involved for Kohls, but not for me. I pull up, plug in, gain electrons and pay NOTHING for them…therefore…those electrons are…free!!

Gotta love it.

Quote from: RE
The solar arrays take copious fossil fuels to produce.

But I'm not buying them. Kohls pays for those, and gives me the fuel for…FREE!!

Quote from: RE
Hydro power has limitations that are quite obvious at Lake Mead and Lake Powell now. 

I wasn't referencing the hydropower from Hoover or Glen Canyon as an advantage, of the Pac NW. Those wild and crazy folks who want to build stuff in the desert can have it. But I haven't received any FREE fuel from them, haven't been that far out west with the Volt.

Quote from: RE
Replacing the batteries will become ever more difficult and expensive.

The batteries for the Prius become ever more easier and less expensive with time. And certainly things in the battery business are trucking along quite nicely.

http://www.lasvegassun.com/news/2014/sep/03/tesla-chooses-nevada-battery-factory-sources/

Don't know about your neck of the woods but batteries have improved and gotten cheaper and smaller at the same time, perhaps you just haven't been keeping up with the march of technology? You bought an electric scooter, right? You aren't using lead-acid stuff in it are you?

http://www.extremetech.com/computing/186952-stanford-creates-holy-grail-lithium-battery-could-triple-smartphone-and-ev-battery-life

Quote from: RE
The roads will deteriorate as fewer people can afford to use them and maintain them.

Yeah, that one has been tried already, back in the peak oil days. I remember when Ruppert pitched this one, and it didn't work. Any reason why, during the modern era of ever more efficient chemical feedstock usage, you figure roads are going bye-bye NOW,this many years after peak oil has been claimed? When cars are going out by the bucket loads?

http://online.wsj.com/articles/auto-sales-lose-some-steam-in-august-1409746818


Quote from: RE

  This is freaking obvious.  You simply ignore reality to commit further fraud in your chosen profession.  You are selling a lie.

RE

It was obvious to Ruppert as well. And it was wrong. You certainly don't have any better prognostication delusional powers than he did…so why is the SAME idea recycled by YOU have any more value other than…as the same bad idea?
Sometimes one creates a dynamic impression by saying something, and sometimes one creates as significant an impression by remaining silent.
-Dalai Lama

Offline RE

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #41 on: September 04, 2014, 10:01:02 PM »
The fact Kohl's pays for it establishes that the energy does not come free.  You can be certain if everybody had an EV, the power stations would not be free from Kohls or anyone else.

Battery prices may drop, however purchasing power of the consumer is dropping faster.  In any event, battery production is fossil fuel dependent.


Far as Batteries up here go, as noted they aren't great in cold weather, so you have to have means to keep them warm to be useful in winter.  Li-I batteries are quite difficult to get up here because they aren't U/L approved and the battery stores don't carry them.  You can't have them air shipped up either.  To get some, I have to do the same kind of kludge I used to get the scooter up here, which is to hitch a ride when one of my friends contracts a barge load.  Meanwhile, I use Lead Acid, which works fine for the uses I put the scooter to at the moment.

Mike Ruppert wasn't wrong about anything other than timelines.  The road system continues to deteriorate faster than it is being repaired.

Bridges
C+
2013 GRADE
Over two hundred million trips are taken daily across deficient bridges in the nation’s 102 largest metropolitan regions. In total, one in nine of the nation’s bridges are rated as structurally deficient, while the average age of the nation’s 607,380 bridges is currently 42 years. The Federal Highway Administration (FHWA) estimates that to eliminate the nation’s bridge deficient backlog by 2028, we would need to invest $20.5 billion annually, while only $12.8 billion is being spent currently. The challenge for federal, state, and local governments is to increase bridge investments by $8 billion annually to address the identified $76 billion in needs for deficient bridges across the United States.

Read the Full Report for the rest of the details.

RE
« Last Edit: September 04, 2014, 10:57:10 PM by RE »
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Offline Golden Oxen

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Re: US Energy Sources and Uses Show Limits of Renewable Energy Strategies
« Reply #42 on: September 05, 2014, 05:46:08 AM »
Quote
Far as DS opinion, I don't agree with it.  I get more information in 2 minutes of Googling than in 2 years of innumerable postings by Moriarty which mainly are self congradulatory exercises in bragging mixed with sneering condescension.  He doesn't pass on worthwhile information here, he just sows discontent.

RE

I understand your view. Was only trying the elder role of attempted peacemaker. Will not mention the topic again.

 

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