L-188
Topic Author
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9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 2:31 pm

Well if you are buying gas in America you might want to do it really quickly.

The Prudhoe Bay Oilfield operated by British Petroleum is going offline immedately. Prudhoe Bay in Alaska in the largest oilfield in the United States. The neighboring fields operated by other oil companies shouldn't be effected. This oilfield represents half the current oilflow in the trans-Alaska oil pipeline. Some 400,000 fewer barrels of oil per day will be sent down the pipe.

What has brought this shutdown on is that significant corrosion including a 40 barrel leak to pipe jacketing insulation has been found in the transit lines from the production facilities to the Central Production Facilities that feed the Alaska Pipeline. Those pipes will need to be shut down and replaced. This will be a long shutdown.

The inspections that has triggered where caused by an earlier oil spill in March when some 20K barrels of oil where spilled.

I suspect that the people of Washington and Oregon are going to be hardest hit by this since most of the oil used by the BP Cherry Point refinery in Washington State originates from Alaska.

I expect gas prices to rise significantly

[Edited 2006-08-07 07:32:44]
OBAMA-WORST PRESIDENT EVER....Even SKOORB would be better.
 
searpqx
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 2:50 pm

Was just reading about this. The BP spokesman was predicting spikes of $10/barrel. Oh joys!
"The two most common elements in the universe are Hydrogen and stupidity"
 
jcs17
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 3:04 pm

Gee, wouldn't it be nice to have the security of ANWR, right now? As opposed to a few caribou...
America's chickens are coming home to rooooost!
 
AsstChiefMark
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 3:04 pm

My tank was really low and I was planning to fill up tomorrow. But I heard the news on TV and decided to go fill up tonight.

It's a good thing. The guy at the station said his regional office called and said to expect a 10% price increase in the morning.

Mark
Red tail...Red tail...Red tail...Red tail...Red tail...Red tail...Red tail...Red tail...Damned MSP...Red tail...Red tail
 
ANother
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 7:23 pm

A little off-topic, but why do we allow companies to control the entire distribution chain? Drilling, production, pipeline, tankers, refineries, pipelines, distribuition, road tankers, petrol stations, etc.

Maybe I'm a little naive but I don't see how BP will suffer, only profit from this.
 
dtwclipper
Posts: 6668
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 7:57 pm

Funny, how they screw up, and get rewarded with higher profits, I want a job like that!


No wait, it's not funny.
Compare New York Air, the Airline that works for your Business
 
ltbewr
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 8:30 pm

This also means that more oil will have to be imported from places we don't want to deal with, supporting terrorism or bad governments. I also suspect that all of the West coast and adjacent states like Nevada, Idaho, will be severely affected.
Until we really make a massive decision to put in conservation policies and start to move away from oil based fuels, we will continue to be in fear of oil disruptions and at the mercy of oil companies and unfriendly governments.
 
Mir
Posts: 19108
Joined: Mon Jan 05, 2004 3:55 am

RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 8:42 pm

Quoting JCS17 (Reply 2):
Gee, wouldn't it be nice to have the security of ANWR, right now? As opposed to a few caribou...

One could eat the caribou though. Oil doesn't taste nearly as good.  Smile

-Mir
7 billion, one nation, imagination...it's a beautiful day
 
cedarjet
Posts: 8101
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 8:45 pm

Quoting JCS17 (Reply 2):
Gee, wouldn't it be nice to have the security of ANWR, right now? As opposed to a few caribou...

Dude, there's so little oil up there, it really wouldn't make any difference. 10 billion barrels is a lot, and it's nice to know it's there, but (a) it's only 100 days worth at current world use, (b) and once it's gone, it's gone. You might think you're hurting right now, but wait another year or two and the Ghowar field in Saudi hits exhaustion. Very shortsighted of you, in a $10 spike, to freak out and immediately call for the last untappe4d oil field in North America to be drilled. Could you try walking / cycling, or driving a smaller car (my apologies if you already have a hybrid, or enjoy walking instead of driving).
fly Saha Air 707s daily from Tehran's downtown Mehrabad to Mashhad, Kish Island and Ahwaz
 
deltagator
Posts: 6170
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 10:05 pm

Quoting Cedarjet (Reply 8):
Could you try walking / cycling

Not in most major cities in the US unfortunately. The lack of good public transportation doesn't help either but you can blame the ignorant NIMBYs on that one.

Quoting Cedarjet (Reply 8):
it's only 100 days worth at current world use

Who said we'll share it?  Wink

Quoting Cedarjet (Reply 8):
and once it's gone, it's gone.

Thus bringing on the invasion of Canada.  Wink
"If you can't delight in the misery of others then you don't deserve to be a college football fan."
 
deltadc9
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RE: 9% Of US Oil Production Going Off-line

Mon Aug 07, 2006 10:26 pm

Quoting JCS17 (Reply 2):
As opposed to a few caribou...

Actually, they like the pipeline and hang out close to it because its warm and provides shelter. Migration and reproduction have not been negatively affected at all, and there is some evidence it has actually helped the animals.

Quoting Cedarjet (Reply 8):
but (a) it's only 100 days worth at current world use

Wrong. And using that misleading stat to minimise the amount is nothing short of sleazy. You also seem motivated to stick with the lowest possible estimate. Should I be surprised?

It would not and could not all be pumped at once and you know it so that post was nothing short of a lie. It would add a healthy domestic percentage for 20-30 years, and there is more besides that one area to tap also.
Dont take life too seriously because you will never get out of it alive - Bugs Bunny
 
L-188
Topic Author
Posts: 29881
Joined: Wed Jul 07, 1999 11:27 am

RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 12:08 am

Quoting Cedarjet (Reply 8):
but (a) it's only 100 days worth at current world use

A bit misleading for a couple of reasons. 1) At the 1 million BOD that the pipeline can handle there is a signficantly longer period of time that field will produce. 2) Kuparuk. That field was developed in the early 1980's. It was predicted to be good for 2 Billion barrels. It hit that mark last year, and is still producing at about half of the initial rate.

Quoting DeltaDC9 (Reply 10):
Actually, they like the pipeline and hang out close to it because its warm and provides shelter. Migration and reproduction have not been negatively affected at all, and there is some evidence it has actually helped the animals.

That and there is a blanket 5 mile wide no-hunting zone around those facilities.
OBAMA-WORST PRESIDENT EVER....Even SKOORB would be better.
 
roadrunner165
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 1:32 am

Quoting ANother (Reply 4):
A little off-topic, but why do we allow companies to control the entire distribution chain? Drilling, production, pipeline, tankers, refineries, pipelines, distribution, road tankers, petrol stations, etc.
Maybe I'm a little naive but I don't see how BP will suffer, only profit from this.

We allow oil companies to control the entire distribution chain beacuse we have a free market that allows this to happen. They are private companies that have invested billions (if not trillions) of dollars in exploration, drillings, shipping, and refining crude oil. We all know how the governemnt likes to mess things up, do we really want them involved in the oil sector anyways?

BP is going to have to fix whats broke and clean up any spills, Thats going to cost a lot of money. Im sure BP would rather be up and running then have to stop production to fix whats broken. Accidents like this lead to a lot of media coverage and ultimelty bad PR.

Quoting LTBEWR (Reply 6):
This also means that more oil will have to be imported from places we don't want to deal with, supporting terrorism or bad governments.


How about we just cut consumption, now there's a noble idea.




Adam
 
CO7e7
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 1:35 am

Quoting Searpqx (Reply 1):
spikes of $10/barrel. Oh joys!

Is the rise in gas prices going to affect all gas stations or only BP ones?

-Zaki
 
roadrunner165
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 2:12 am

Here is the story of gas production as I understand it, someone please correct me if I am wrong or mistaken. Crude oil is pumped up from the ground and shipped through pipes and ships to get to the refinery. Once it reaches the refinery it is processed into gas/diesel etc. Then it is shipped from the refinery to a distribution terminal usually through a smaller pipe. From the terminal, a distributor/jobber with trucks hauls the fuel from the terminal to the local gas station. Not one single oil companies does all of the above. For example: BP may own the well where the oil is pumping from, The Trans-Alaska Pipeline is owned by Alyeska, the oil is refined by Tesoro at its refinery and then shipped to the terminal through another piped owned by Valero and the terminal may be operated by ConocoPhillips. Also keep in mind that when you see a BP or a ConocoPhilllips gas station it does not mean that oil company owns that station. Chances are the owner is someone local (or a regional company) that is branded under the BP or ConcoPhillips, or Tesoro, Cennex brand/logo.

Quoting CO7e7 (Reply 15):
Is the rise in gas prices going to affect all gas stations or only BP ones?



The only difference between BP and any other brands gas it the types of additives that are added to the fuel at the terminal before it is delivered to the gas station. All the gas/diesel/jetfuel in the country comes together in the network of pipeline that criss cross across America. There is not a specific pipe for BP gas, its all combines... So this will affect all gas prices not just BP.



Adam
 
CO7e7
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 2:52 am

Quoting Roadrunner165 (Reply 16):
The only difference between BP and any other brands gas it the types of additives that are added to the fuel at the terminal before it is delivered to the gas station. All the gas/diesel/jetfuel in the country comes together in the network of pipeline that criss cross across America. There is not a specific pipe for BP gas, its all combines... So this will affect all gas prices not just BP

Thanks for the explanation Roadrunner165... i appreciate it.


-Zaki
 
searpqx
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 3:03 am

Quoting CO7e7 (Reply 15):
Is the rise in gas prices going to affect all gas stations or only BP ones?

All, as the per barrel price increase is market wide. As of right now its up $2 from yesterday. However word is the Feds have agreed to release oil from the reserve to replace any lost from BP. Technically that should relieve the price pressure, so we'll see where it stands at the end of the day.
"The two most common elements in the universe are Hydrogen and stupidity"
 
truant
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 4:28 am

The pipeline has been around awhile (30 years+). Has anyone ever told the BP brain trust about "preventive maintenance"?

Rhetorical question.

These are the same tools (who through the API) propagandize us with "preventive maintenance" and the 3,000 mile oil changes. I guess what only serves their profit motives is convenient.

Here we go again, this season's manufactured oil/gasoline supply shortage. Last fall it was Katrina (having a great deal of your receiving and refining capacity in one area prone to disaster). This spring it was ethanol replacing MTBE, this summer that idiot Ahmedinajad's ranting down a well in Iran. I guess since hurricane season was slow this year the oil industry had to come up with something.
 
N231YE
Posts: 2620
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 4:34 am

"Cha-Ching" the sound of a cash register as it drains your wallet, just another excuse to raise gas prices...

THANK GOD I DRIVE A HYBRID!  laughing 

N231YE ~ 2004 Honda Civic Hybrid w/CVT, 48 MPG hwy
 
andrewuber
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 5:49 am

Pretty obvious what will happen:

1. Fuel prices will surge in the U.S. due to the discovery of "corrosion on a pipeline" (did they not adequately protect the hardware??)

2. More whining and moaning by all of us in the U.S. who are already tired of paying $3.50 for a gallon of gas

3. Fuel prices will NOT GO BACK DOWN - once the oil companies force us to pay more for fuel - they have no reason to reduce the price (just like after Katrina)

4. BP will be added to the list of oil companies turning $100 billion profits per month

Wanna fight back? Buy BP stock, and you'll get some of your money back.

Thank GOD I bought a Hybrid a couple weeks ago.

Drew
I'd rather shoot BAD_MOTIVE
 
roadrunner165
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 6:43 am

Quoting Andrewuber (Reply 28):
3. Fuel prices will NOT GO BACK DOWN - once the oil companies force us to pay more for fuel - they have no reason to reduce the price (just like after Katrina)

Economics 101 Chapter 1 Supply and Demand - try googling it!

Humans will continue to use oil untill it become cheaper to uses a different form of energy, then big oil companies are screwed. BTW $3.50 a gallon is cheap for gas when you compare it to what people in Europe are paying.


Adam

[Edited 2006-08-07 23:44:35]
 
NWDC10
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 7:16 am

Gas prices will come down alittle during "off peak" periods or in the Winter Season but go back up again this Spring. Only way to fight back is use less/conserve at the same time find an alternate source. Corn biodiesel is not the answere. You get more "energy" out of soybeans. There are alot of "empty spaces" in the USA. We need to built hundreds of thousands of Wind Generators to make alot more electricity and we need to build electric cars. Robert NWDC10
 
md80fanatic
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 11:02 am

Quoting NWDC10 (Reply 37):
There are alot of "empty spaces" in the USA. We need to built hundreds of thousands of Wind Generators to make alot more electricity and we need to build electric cars.

I believe the last thing we need is to absorb more energy from the weather in the form of windpower (solar or wavepower also). You cannot get something for nothing, you know. If we take from one point, the reduced wind energy can and probably will manifest in marked changes in the weather patterns over large areas, perhaps worldwide.

We should be working the hardest at trying to develop the most bang for the buck (the most energy liberated per sample size) which is nuclear. Ounce for ounce, nuclear is the only energy source capable of safely powering human needs from now into the distant future. Also...if we are to explore space, we better start using and perfecting nuclear power. We won't get far on solar.
 
baroque
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 2:37 pm

Quoting Truant (Reply 17):
The pipeline has been around awhile (30 years+). Has anyone ever told the BP brain trust about "preventive maintenance"?

Er yes, I think the problems are quite well known as well as being quite costly:
http://www.corrosioncost.com/pdf/oilgas.pdf
Around 2001, measures to combat corrosion cost about USD1.3 billion pa.
Note one of the authors for that paper is from Saudi Aramco, that group having vast experience due to the very difficult chemical conditions for some of the Khuff gas.

The problem is in the transit lines feeding the main pipeline but much more is available on the main line.

As for the Trans Alaska pipeline:
"The 48 inch diameter pipe is made of specially coated material covered with zinc anodes to ward off corrosion. More than 800 crossings of rivers and streams are made between Prudhoe Bay and Valdez."
http://fairbanks-alaska.com/trans-alaska-pipeline.htm

Of course you can have cheaper gas if you don't mind the pipeline failing every now and again and spilling oil, but usually repair is more expensive than prevention.

It will be making BP even less happy than the angry posters on this thread that they have had to have a shut in.

"The Joint Pipeline Office was organized in 1990 in answer to concerns about corrosion of the pipe and potential spills. The office is composed of nine state and federal management agencies who issue permits and monitor operation of the pipeline to encourage environmental safety."

The transit lines had apparently not been pigged since being installed, one fear being that if they were pigged, this would send silt into the main line. There were maintenance systems in operation but it appears that ultra-sonic testing was not giving an accurate appraisal.

So you could ask a different question, how much more would you have been paying for the past 20 years if better preventive maintenance had been in operation? And how bitter would have been the complaints if the more expensive maintenance had in the end not been needed?

Give them a break, it is a miracle they get oil out of there at all, let alone at moderate costs.
 
baroque
Posts: 12302
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RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 2:51 pm

Quoting MD80fanatic (Reply 22):
I believe the last thing we need is to absorb more energy from the weather in the form of windpower (solar or wavepower also). You cannot get something for nothing, you know. If we take from one point, the reduced wind energy can and probably will manifest in marked changes in the weather patterns over large areas, perhaps worldwide.

A very worrying post MD80 because you could be right. However, if you are, we are already in a deep mess (sorry you knew that!) because so many of our structures do that anyway. It would be interesting to work out how much perturbation to the wind comes from a high rise city and how this compares with the effects of a wind farm.

I suspect they might be similar in terms of magnitude, it would be interesting to do some calculations.

It is also a bit like the A380 wake turbulence stuff, a windmill presumably produces a relatively clean wake, whereas a city will produce vector reversals.

In spite of working for the fossil fuels industry, I am sure you are correct about nuclear. However, just one request, when you get your flying (rocketing, whatever) nuclear power going please make sure it does not fall on me. I am not really that worried about the radioactivity, more about the weight!

Which brings us back to BP and Prudhoe, all of the other options are a heck of a lot more expensive even than Alaskan oil - at the time of its development the most expensive oil in the world. And BP do deserve some credit for being the guys who went and found it when there were plenty of doomsayers around to tell them what a wast of money it would be exploring up there.

Arguably, BP have discovered more new oil provinces than any of the other majors and by doing that, probably gave you 10 to 20% cheaper oil for maybe 30 years.
 
iowaman
Posts: 3874
Joined: Thu May 20, 2004 2:29 am

RE: 9% Of US Oil Production Going Off-line

Tue Aug 08, 2006 3:21 pm

Quoting AsstChiefMark (Reply 3):
It's a good thing. The guy at the station said his regional office called and said to expect a 10% price increase in the morning.

10%? That's 30 cents a gallon. Hopefully I can get filled up in the morning before it does go up that much.

Quoting Andrewuber (Reply 19):
1. Fuel prices will surge in the U.S. due to the discovery of "corrosion on a pipeline" (did they not adequately protect the hardware??)

2. More whining and moaning by all of us in the U.S. who are already tired of paying $3.50 for a gallon of gas

3. Fuel prices will NOT GO BACK DOWN - once the oil companies force us to pay more for fuel - they have no reason to reduce the price (just like after Katrina)

4. BP will be added to the list of oil companies turning $100 billion profits per month

Wanna fight back? Buy BP stock, and you'll get some of your money back.

Thank GOD I bought a Hybrid a couple weeks ago.

 checkmark 
 
deltadc9
Posts: 2788
Joined: Fri Apr 14, 2006 10:00 pm

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 1:17 am

Quoting Roadrunner165 (Reply 20):
then big oil companies are screwed.

Nope, do you really think they will let other companies take over energy supply? Come on!

They are developing alternatives as we speak, but they will deplete the oil supply first to create demand for more expensive alternatives. Who is going to pay more now when oil is still cheap?

Never underestimate energy companies ability to adapt, because who has more money to fund fundamental change and already has a world wide infrastructure?

I think the irony of the current situation is priceless. All these poeple saying that Alaska does not have enough oil to make a dent, and then once they shut of HALF the supply, chaos ensues. PRICELESS!
Dont take life too seriously because you will never get out of it alive - Bugs Bunny
 
deltadc9
Posts: 2788
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 1:58 am

Here is a picture of the primary facility for those who have never actually seen a picture of what really is up there and what it really looks like.

Big version: Width: 298 Height: 188 File size: 10kb
Dont take life too seriously because you will never get out of it alive - Bugs Bunny
 
FDXmech
Posts: 3219
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 3:19 am

Quoting Andrewuber (Reply 19):
3. Fuel prices will NOT GO BACK DOWN - once the oil companies force us to pay more for fuel - they have no reason to reduce the price (just like after Katrina)

You are absolutedly....wrong. And history proves it. In the early 80's during the Iranian fuel crisis, prices jumped over a dollar a gallon, odd and even gas days ensued. People said that's it, prices can never come down, OPEC has us over a barrel. But guess what, prices came down, and radically so a few years later. The overpriced commodity, slowed down the worlds economy therefore reducing demand. The world went to other types of energy sources again reducing demand. Fuel efficiency was the watchword, again cutting demand. Prices plummeted.

Smart oil exporting nations such as Arabia though profiting from high worldwide prices know these very high prices portend hardship in the end. High oil prices will kill their golden goose customers by slowing their economies and forcing them to choose alternate sources of energy.
You're only as good as your last departure.
 
andrewuber
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 3:24 am

Quoting FDXMECH (Reply 28):

Oh of course. I should have been more specific. Before Hurricane Katrina, we were paying maybe $2.50 per gallon. When Katrina slammed ashore, the US production went down, and gas prices jumped by about a dollar per gallon. Now a lot of that production has resumed, and gas priced DID come down - a whole 20 cents. We are NOWHERE NEAR our pre-Katrina fuel prices.
I'd rather shoot BAD_MOTIVE
 
deltadc9
Posts: 2788
Joined: Fri Apr 14, 2006 10:00 pm

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 3:32 am

Quoting AndrewUber (Reply 29):
We are NOWHERE NEAR our pre-Katrina fuel prices.

That does not mean we never will be. Also, adjusted for inflation, we are just now seeing price levels equal to the 1970's.
Dont take life too seriously because you will never get out of it alive - Bugs Bunny
 
FDXmech
Posts: 3219
Joined: Sun Mar 19, 2000 9:48 pm

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 3:56 am

Quoting AndrewUber (Reply 29):
Oh of course. I should have been more specific. Before Hurricane Katrina, we were paying maybe $2.50 per gallon. When Katrina slammed ashore, the US production went down, and gas prices jumped by about a dollar per gallon. Now a lot of that production has resumed, and gas priced DID come down - a whole 20 cents. We are NOWHERE NEAR our pre-Katrina fuel prices.

My example of the 1980 oil price spike to bargain basement gas prices and eventually moderate gas prices were in the making of over several years and lasted over a couple of decades, not several months.
Though I remember after the initial Katrina price spike prices came down about a dollar per gallon not 20 cents.
You're only as good as your last departure.
 
incitatus
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Joined: Wed Feb 09, 2005 1:49 am

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 4:51 am

BP is the new Enron.
Stop pop up ads
 
deltadc9
Posts: 2788
Joined: Fri Apr 14, 2006 10:00 pm

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 5:50 am

Quoting Incitatus (Reply 32):
BP is the new Enron.

That makes no sense. Their profit margin is less than 10%.

Lets not be hypocrites and act like we would settle for even less of a margin for our own businesses.

Also, oil stock prices benefit everyone. Where do you think you 401K mutual funds are putting their dollars? Where do you think insurance companies invest to keep their rates competitive?

Duh.
Dont take life too seriously because you will never get out of it alive - Bugs Bunny
 
scintx
Posts: 252
Joined: Sat Apr 15, 2006 6:00 am

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 6:39 am

Quoting LTBEWR (Reply 6):
we will continue to be in fear of oil disruptions and at the mercy of oil companies and unfriendly governments.

I fear our one way trade. How many sea contains leave the USA with our products on board? I work in manufacturing and I scares me what I see going on. Do you got any friends or family that have made the adjustment to their new "Service" job? Many of those unfriendly governments we helped put in place.
Attention All Planets of the Solar Federation....We have assumed control.....We have assumed control......
 
itsjustme
Posts: 2727
Joined: Sun Apr 25, 2004 6:58 pm

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 6:59 am

Quoting AsstChiefMark (Reply 3):
It's a good thing. The guy at the station said his regional office called and said to expect a 10% price increase in the morning.

Mark, it sounds like your local station may be using this latest news as an excuse to gouge prices. This CBS news article says "With the loss of Alaskan crude, prices are expected to hit new average highs – jumping as much as 10 to 15 cents a gallon".
 
scintx
Posts: 252
Joined: Sat Apr 15, 2006 6:00 am

RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 7:03 am

Off topic but related- Why do we have Chevron-Texaco, Mobil-Exxon, Conoco-Phillips and other companies with two names?

Not that long ago we had the cheap oil. It cost them more to pump it than they could sell the end product for. They merged to stay alive.

By the way if you have a chance you should go see the pipe line, very pretty site. Also they have to take it off line now and then for maintenance. I think they have done a great job for 30 years.

In the mid 80's Dallas had a lot of energy companies and suppliers. Most if not all of these are gone. In Tulsa Oklahoma there is a company that makes sucker rods called Norris Rod. They are one of the last companies in the US to make these and I might add a fraction of what they once were. If we found oil today there isn't a company that can make the equipment in volume. The banks took a bath in the 80's with massive foreclosure and they in turn went out of business. There are plenty of oil wells in the US that have been shut down when prices got really cheap. Some may have reopened? but, many people lost their pants on this and they're gone for good.

Lets just say by chance we actually found a large field of oil in the USA. My question is how many years would you be in court before you could drill. My guess is a minimum of 10 years. Could you imagine all of the so called
"experts" and showing the data on their cause. It might take 20 years.

In 1979 I paid $1.00 a gallon and good paying job paid $10.00 per hour. We could finance a house at 13% and that seemed good. I was making $5.00 an hour and I felt like pretty darn good! That's my .02 cents and take it for what it's worth.

Edit-Idiot Attack and Spelling

[Edited 2006-08-09 00:31:50]

[Edited 2006-08-09 00:32:58]
Attention All Planets of the Solar Federation....We have assumed control.....We have assumed control......
 
itsjustme
Posts: 2727
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 7:16 am

Maybe this is an appropriate time to ask, "Whatever happened to the electric car"? There is an interesting documentary out titled, "Who Killed The Electric Car?" which raises some interesting questions, one being, the title itself. So, what DID happen to the electric car?
 
md80fanatic
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 8:12 am

Quoting DeltaDC9 (Reply 33):
Their profit margin is less than 10%.

That is what they want you to think. It doesn't cost any more to extract the crude than it did before. It doesn't cost any more to transport it than it did before. It doesn't cost any more to refine it than it did before. Their costs are the same, yet the prices they are asking for the finished product has doubled and more.

If you factor in all the capital expenditures made to buy up all the small time refineries (which have since been closed) then perhaps you have a point. Still though...to buy up all the competition in order to shut down capacity, which leads to artificially higher prices, borders on monopoly. That's what you get when you keep electing oilmen to high office.
 
scintx
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 8:46 am

Quoting MD80fanatic (Reply 38):
It doesn't cost any more to extract the crude than it did before. It doesn't cost any more to transport it than it did before. It doesn't cost any more to refine it than it did before. Their costs are the same, yet the prices they are asking for the finished product has doubled and more

I'm going to take it you don't work in the Energy Industry.
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L-188
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 10:44 am

Well the Alaskan Oil Industry's equivlant of Scary Mary, Chuck Hamel is having a field day on the national media. I will admit that this does make him look right.

Right now the big concern is if they can keep the TAPS pipeline running. Channel 2 news said that Alyeska Pipeline has run a test to reduce the flow to 500,000 BOPD. When Prudhoe Bay is completely shut down (A several day process) flow from the remaining fields will only be about 400,000. Right now the people at Alyeska think that if the flow drops to 300,000 BOPD would require the pipeline to be shut down so that the oil would be sent to Valdez in "Batches". The pipeline is fed from storage tanks, so when the tanks are full, they would send a pulse of oil down the pipeline and then shut it down again, until the tanks fill back up and the next slug is sent down.

Needless to say when you are starting up and stopping a pipeline constantly like that, like any other mechaincal object you are putting a lot of wear and tear on it and running the risk of something breaking. I don't believe that the pipeline has ever operated like this.

OF course if ANWR had been opened in 1994, that field would just be comming on line, probably into PS2 and woudl be able to continue operating and probably producing up to twice what the current production rate of Prudhoe was.
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 12:53 pm

Is this where ANCFlyer works?
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baroque
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 10:25 pm

Quoting Scintx (Reply 36):

Not that long ago we had the cheap oil. It cost them more to pump it than they could sell the end product for. They merged to stay alive.

Indeed they did that to stay alive - especially to meet the expectations of the funds managers! It is also interesting to watch some of those merged entities and note that the mergers may have kept them afloat in the late nineties, but are now contributing to the sluggish response of exploration to what should be buoyant times. In most cases, each of the previous entities had its strengths (and weaknesses) but most of the merged ones have few of the strengths and most of the weaknesses of the parents. So enjoy the effects of the earlier low prices!

Quoting Scintx (Reply 36):
Lets just say by chance we actually found a large field of oil in the USA. My question is how many years would you be in court before you could drill. My guess is a minimum of 10 years. Could you imagine all of the so called
"experts" and showing the data on their cause. It might take 20 years.

But where did you find this giant or better super giant? Let us suppose you are going for a modest giant, 2 billion barrels. About the only likely place would be offshore S CA and indeed you might have troubles there. In the Gulf of Mexico, you might get a really large find (huge is what the papers would say in breathless tones) of say 800 million barrels, and depending on how deep the water is, that would be in production within about 3 years of discovery.

But then what sort of difference would those fields make? Not that it could be produced at that rates, but a 2 billion barrel field would replace US imports for nearly 7 months, and the 800 million barrel field for all of two and a bit months. Only the super giants make much difference when the US consumption is concerned.

Quoting L-188 (Reply 40):
Needless to say when you are starting up and stopping a pipeline constantly like that, like any other mechaincal object you are putting a lot of wear and tear on it and running the risk of something breaking. I don't believe that the pipeline has ever operated like this.

I am not sure about mechanical wear, and you are probably correct, but the killer will be the pour point. Prudhoe Bay oil has a pour point of about 15 F which is quite low, but the problem comes from the winter temperatures that are even lower. The heating system for Tapline (as I understand it) is based on continuous flow, and its effectiveness is rate dependent. Stopping flow in winter will give you effectively a very long candle! As far as I can see, to allow lower flow rates, you will have to alter the heating regime in the main line - not a trivial task.
 
deltadc9
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RE: 9% Of US Oil Production Going Off-line

Wed Aug 09, 2006 11:38 pm

Quoting Scintx (Reply 39):
I'm going to take it you don't work in the Energy Industry.

Or have much experience with how public corporations report earnings
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L-188
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RE: 9% Of US Oil Production Going Off-line

Thu Aug 10, 2006 12:17 am

Quoting Baroque (Reply 42):
Prudhoe Bay oil has a pour point of about 15 F which is quite low, but the problem comes from the winter temperatures that are even lower.

Well I figure they have about 2-3 months before they have to worry about temps dropping down to where that starts becoming a problem.

Quoting Baroque (Reply 42):
Not that it could be produced at that rates, but a 2 billion barrel field would replace US imports for nearly 7 months

Kuparuk is the reason I have problems with that anaylsis. When that field was brought on-line it was predicted to have a life of 20 years and would produce 2 Billion barrels. Last year it was a 25 year old field, and while production is down rougthly half from it's peak, it is still in production and will produce most of the oil that will still entering the TAPS system while PBU is down. Also last year the two billionth barrel was pumped.

The fact is that when you use a "6 months of oil" against drilling (Common in the ANWR debate) you have to factor in the available space on TAPS. You will only be able to put 1 mllion barrels a day through TAPS.
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ANCFlyer
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RE: 9% Of US Oil Production Going Off-line

Thu Aug 10, 2006 2:46 am

Only the Prudhoe Bay field is shut down - well, getting shut down, it willtake a week to shut off.

The Kuparuk, Badami, Milne Point, West Sac, etc fields are still producing. They are new(er) and the pipe is of different composition. There is sitll 600,000 barrells a day coming off the North Slope.

BP has had MAJOR problems over the last 18 months up there, corrosion prevention wasn't done properly, one man from Kenai killed when a corroded well head exploded 18 months ago, a 200,000 barrel spill across from Pump Station 1 in March, then these two leaks the other day. Someone forgot to do the corrosion prevention and there will be jail time.

BP has already been shipping new, stainless steel lined pipe to Prudhoe to replace the damaged pipe. They will have to replace everything between Gathering Center 3 and Gather Center 2. It's all corroded.

No worries, 600,000 barrels a day is still flowing south. No issues with jobs or anything - they will need a LOT of Veco people to replace the pipe. Should be done by Christmas I'd guess - not the 2 months BP predicts - and you should see about 50cent a gallon fuel price increase. We've seen 18 cents a gallon increase here in the last 2 days.

Quoting L-188 (Reply 44):
You will only be able to put 1 mllion barrels a day through TAPS.

Actually, the line can handle 2,000,000 million barrels a day . . . sustained.
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incitatus
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RE: 9% Of US Oil Production Going Off-line

Thu Aug 10, 2006 2:56 am

Quoting DeltaDC9 (Reply 33):
Also, oil stock prices benefit everyone. Where do you think you 401K mutual funds are putting their dollars? Where do you think insurance companies invest to keep their rates competitive?

I don't "think" about where my retirement money goes, I know it. And you don't.

You lack basic understanding of how an economy works. Higher commodity prices only benefit those who own it. If oil goes to $500/barrell and the stock price of oil companies is multiplied ten fold, it will be bad for net users of oil, in particular for the US. The benefit a regular person might draw from having a retirement account that invests a small percentage in oil stocks gets washed away by taking a hit on other stock ownership, at higher prices at the pump, in the general increase of transport costs and in the slower growth of the economy.

I am obviously poking fun at BP comparing it to Enron, but this whole story smells like rolling blackouts in California. They deserve lots of scrutiny.
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deltadc9
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RE: 9% Of US Oil Production Going Off-line

Thu Aug 10, 2006 3:57 am

Quoting Incitatus (Reply 46):
You lack basic understanding of how an economy works. Higher commodity prices only benefit those who own it.

Talk about a lack of understanding....
Dont take life too seriously because you will never get out of it alive - Bugs Bunny
 
L-188
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RE: 9% Of US Oil Production Going Off-line

Thu Aug 10, 2006 10:28 am

Quoting ANCFlyer (Reply 45):
Actually, the line can handle 2,000,000 million barrels a day . . . sustained

Sorry I meant an additional 1mbopd from ANWR.

There are also studies on right now to see if at least the west side of the field can be kept running through some of the other lines.
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RE: 9% Of US Oil Production Going Off-line

Thu Aug 10, 2006 11:17 am

How long is it going to take to repair this?
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