Chavez to give Massachusetts' cheap oil - Times of India
Thousands of low-income Massachusetts residents will receive discounted home heating oil this winter under an agreement signed with Venezuela, whose government is a political adversary of the Bush administration. A subsidiary of Venezuela's state-owned oil company will supply oil at 40% below market prices. It will be distributed by two nonprofit organisations, Citizens Energy and the Mass Energy Consumer Alliance. The agreement signed Tuesday gives president Hugo Chavez's government standing as a provider of heating assistance to poor US residents at a time when US oil companies have been reluctant to do so and Congress has failed to expand aid in response to rising oil prices. US Rep William Delahunt, a Massachusetts Democrat, met Chavez in August and helped broker the deal. He said his constituents' needs for heating assistance trump any political points the Chavez administration can score. "This is a humanitarian gesture," Delahunt said, speaking after a news conference with Venezuelan officials outside the home of a constituent who will receive heating aid. Citgo is the Houston-based subsidiary of Venezuela's state-owned oil company and has about 13,500 independently owned US gas stations. It is offering Massachusetts more than 12 million gallons (45.4 million liters) of discounted heating oil over the next four months, starting in December.
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Facing oil's expensive future - CNET
The price of oil will rise dramatically--from an expected $46 a barrel in 2010 to $74 a barrel in 2030--in part because of a projected doubling of demand, said Fatih Birol, the chief economist for the International Energy Agency, speaking at the International Petroleum Technology Conference here. And that's only if oil producers invest heavily in new refining technologies, novel fuels and extraction techniques. Without intense investment, oil prices could rise 32 percent more by 2030. "We shouldn't expect too much of a decline in oil prices," he said. "Forty-six dollars is actually much higher than our earlier estimates." The amount of greenhouse gases pumped in the atmosphere will also likely rise. Solar and other alternative energy technologies could reduce this, but the amount of carbon dioxide will still be far higher than it was in 1990, he predicted. This somewhat ominous picture comes courtesy of a confluence of forces. China, India and other emerging nations have increased demand for oil and natural gas. Cars are a major part of the picture too. Although power plants and other formerly oil-burning facilities have begun to phase out oil in favor of cleaner alternatives, oil remains the fuel of choice for moving vehicles. "Almost all of the growth in the last four years comes from the transportation sector. That is different than the last 20 years," he said. "It is very difficult to substitute other fuels in transportation." By 2030, demand will likely hit 121 million barrels of oil a day. Now, the world consumes about 80 million barrels a day. Back in 1990, the world consumed 66 million barrels a day and in 1970 only 50 million barrels a day. (Oil today sells for around $57 a barrel, lower than the 2010 projection, but lower than recent highs.) The increase in demand, naturally, will raise revenues for oil producers and oil producing nations. Energy exports, which include oil but also things like natural gas, from the Middle East will go from $313 billion in 2004 to $636 billion. The increase in sales, however, will also require sinking money into capital expansion and research and development. Auto manufacturers, for instance, are building engines that require cleaner, lighter fuels. Unfortunately, the supply coming out of the ground is more sulfurous. As a result, it will have to be more finely refined. Oil producers will have to invest $180 billion in refinery capabilities to keep up, Birol said.
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Image problems lead to worker shortage in oil industry - News.com
Who wants to work for an oil company? Apparently not too many college students. Oil and gas companies are in the midst of a personnel crisis, according to several speakers and attendees at the International Petroleum Technology Conference taking place in Doha, Qatar this week. Global enrollment in geosciences and other university majors relevant to the oil industry is dropping at the same time that the demand to devise new fuels and refining processes is rising. In the U.S., enrollment in geosciences hit a peak of 35,000 students in 1982 but now meanders around the 5,000 level, according to Scott Tinker, director of the Bureau of Economic Geology at the University of Texas. "It is now around 1965 levels," he said. While enrollment in these programs is rising in China and a few other nations, it's mostly below the level required in nations where oil is being produced. The picture is even worse at the graduate level. In 1982, about 4,000 Ph.D.s and master's degrees were awarded in geosciences in the U.S., and nearly half the recipients went into the oil industry, said Raul Restucci, executive vice president of exploration and production in the Middle East at Shell. Now only about 400 to 600 advanced degrees are handed out, and only 20 percent of recipients go to work for oil companies. "The industry is having a real tough time filling jobs," Restucci said. "People availability will be a key constraint for a supply side response to increasing demand. In Houston, half of the work force will retire in the next 10 to 12 years." The industry, of course, can blame many of the problems on itself. Since 1982, when the oil shocks of the '70s were subsiding, 1 million people in the industry have been laid off, according to Tinker. The problem is further compounded by a tarnished public image. "How are you going to get young graduates to join who think of it as something they don't want to be associated with?" asked Patricia Caswell, CEO of the Victorian Association of Forest Industries and a former environmental activist. "Look to yourself as leading yourself out of your own problems. You should be looking for solutions to the CO2 in the atmosphere way before everyone else." Restucci agreed. "We will not be able to recruit and retain people if people do not see us as a high integrity industry," he said. Diversity is not too hot either. At Total, a French oil company, the overall work force has become somewhat multinational. However, 81 percent of the senior management positions are held by French citizens, said Francois Viaud, senior vice president of human resources of exploration and production at Total. Women represent only 5 percent of senior management and 17 percent of managers. "This is not acceptable anymore," Viaud said. The average age at the company, he added is 45. Only 11 percent of Total's employees are under 30. The company has launched a diversity hiring effort. Managers are given targets, but not quotas, to hire more women and multinationals, Viaud said. During various panel sessions at the conference, several Middle Eastern attendees complained about the lack of representation of local employees at international oil companies. Several executives acknowledged that companies have looked too close to home when hiring, but the picture is a bit complex. For one thing, Middle Eastern nations did not try enough in the past to create a system to produce qualified students and employees. Instead, the local governments sometimes pushed oil companies to effectively create make-work jobs. "Many years ago we told them they were an employee and they did nothing," said Abdullah Bin Hamad Al-Attiyah, Second Deputy Prime Minister and Minister of Energy and Industry for Qatar. "They just sat there and got...a salary." The local university system is also not as robust as those found in Europe and the U.S. To address this, Qatar opened Education City. Under this program, U.S. universities, including Texas A&M, have opened full-fledged branch campuses in Qatar that seek to recruit and educate students in the region. Though students can spend semesters studying at the main campuses in the states, they can also graduate by spending all four years in Qatar. Fatih Birol, chief economist for the International Energy Agency, offered suggestions for resolving the staffing crisis. It starts with money. "If there is significant demand in the market, and that translates to increased salaries, it will provide a signal to students," he said. When it comes to environmental problems, "If windfall profits were to translate into real investments, it would effectively improve the image of the companies," Birol said.
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An Oil-Slicked Playing Field- The Nation
Despite the likely prospect of Iran being referred to the United Nations Security Council for its noncompliance with the Nuclear Non-Proliferation Treaty by International Atomic Energy Agency governors at their November 24 meeting, its leaders do not appear overly concerned, at least not in public. They feel that they have a fighting chance of dissuading India, a rising international power, from repeating its performance at the last IAEA meeting in September, when it voted with America and European Union members against Tehran. The Iranians' bargaining chip is the proposed $22 billion supply of Iranian natural gas to India for the next quarter-century. Between now and 2025, the imports of hydrocarbon energy required by a rapidly industrializing India will rise from 70 percent to 85 percent. This is just the latest instance of how a scramble for petroleum by developing countries worldwide is reshaping the global geopolitics in favor of oil-rich nations. Another recent example was on public display at the recent summit of the thirty-four-strong Organization of the American States at Mar del Plata in Argentina. Here President George W. Bush, the world's most powerful person, who is known to speak Spanish, hardly managed to engage other leaders in friendly conversations, leaving the field open to his adversary, President Hugo Chávez of Venezuela. By all accounts Chávez stole the show both inside and outside the summit venue. Part of Chavez's popularity stemmed from the Petrocaribe Initiative that Venezuela's state-owned oil company, Petroleos de Venezuela SA (PDVSA), signed in June with thirteen Caribbean and Central American countries. It codified a scheme dating back to October 2000 that gave the signatories up to fifteen years to pay for Venezuelan oil with a nominal 2 percent interest at $20 a barrel, one-third less than the prevalent price of $30. The updated scheme enabled the signatories to pay only $40 a barrel instead of the market rate that shot up to nearly $70 in October. Venezuela has been producing petroleum since the 1920s and is among the top four suppliers of crude oil to the United States. In the income league, it belongs to the middle-income nations of the world. But even such newcomers to the game as Sudan are able to wield geopolitical power they could not have imagined even a decade earlier. This is the case with Sudan, one of the poorest countries on the planet. Khartoum acquired a geopolitical leverage with the assistance of China, a veto-wielding permanent member of the UN Security Council. The China National Petroleum Corporation (CNPC) won an oil exploitation contract in Sudan in 1995. Two years later, when Washington put Sudan on the list of countries that support international terrorism, American oil companies had to withdraw from the country. The subsequent void was quickly filled by the Chinese. In 2000 Sudan gave a contract to a consortium headed by CNPC in the Melul Basin region, which proved a prolific source of petroleum. Besides developing oilfields, the Chinese have erected refineries and laid pipelines. Sudan, an oil importer before the arrival of the Chinese, now earns $2 billion in oil exports annually, half of which goes to China. When the issue of the massacres in the troubled Sudanese western region of Darfur was debated at the UN Security Council in September 2004, the United States wanted to impose economic sanctions against the Sudanese regime. Beijing threatened to veto such a resolution. As a result the Security Council passed a watered-down resolution on Drafur. As yet the full significance of these developments appears to have been lost on the policy-makers in Washington. Though seemingly disparate, they collectively represent a trend that will dominate global geopolitics in the coming decades.
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