Tuesday, September 05, 2006

It's a start

From the AP

DETROIT (AP) — The average price of regular gasoline in the state has fallen more than 16 cents per gallon over the past week to levels not seen since mid-March, AAA Michigan said Tuesday.

The statewide average for self-serve unleaded is $2.60, which is 49 cents per gallon less than this time last year.

The Traverse City area had the most expensive gasoline of Michigan's metropolitan areas at $2.80 per gallon, but that was down 25 cents from a year ago, the auto club said.

I'd still like to see more domestic oil exploration, new refineries, research into biodiesel and other alternate fuels - and most of all - a giant middle finger to the Saudis.


Keith Richards said...

No big surprise here. Financial news reports have been saying for months that gas prices are overdue for a big drop because gas supplies have been steadily rising, due to lower consumption and damaged refineries coming back online. Still, I'm as happy as everyone else to get some relief.

Biofuels are interesting but much of what I've been reading lately is negative. The problem is that even if all the surplus crops in our nation are used for biofuels they will only meet only a small portion of U.S. energy needs while causing a major increase in food prices. And biofuels may not be as cheap as they seem at first glance because agriculture is heavily subsidized in the U.S. How much will biofuels cost if farmers have to charge what it actually costs to grow their crops? Biofuels may help a little bit but we still need to take other major steps to reduce dependence on foreign energy.

The biggest, fastest, and cheapest payback comes from conservation. As a conservative I generally prefer to keep government out of the lives of citizens as much as possible, but massive imports of oil from the middle east creates a national security crisis for the U.S. One big step to creating a more stable world is to end purchases of oil from the most politically unstable place on earth: the middle east. At the same time I believe that Americans should be entitled to drive what they like and can afford. This could be done many ways, but here is one simple idea. Increase the federal gas tax to $1 per gallon but give every American car owner a gas tax rebate of $50 per month. This would make the first 50 gallons per month TAX FREE. That works out to about 12 gallons per week. Driving a car that gets 30mpg (I drive a full size car that averages close to that) would allow a person to drive 360 miles per week tax free, or about what the average American drives in a typical week. Drivers could still buy all the gas they want but after the first 50 gallons per month they pay more for gas. Someone who wants to do a lot more driving would still have the option of buying a much more efficient vehicle. The bottom line is this: Americans waste a lot of gas because it has been cheap for so many years. There are so many ways to reduce gas consumption (move closer to work, drive a more efficient vehicle, use public transportation when possible, carpool) that there is no excuse for Americans to be so wasteful. We waste gas because it has long been cheap. To stop waste, make waste expensive. It is that easy.

But even massive conservation won't end oil imports so we still need to increase domestic supply. The answer here is simple: oil shale. There is more oil locked up in oil shale in the U.S. alone than in all the proven oil reserves on earth. U.S. oil shale has enough oil to supply all U.S. energy needs for hundreds of years. China already produces oil from shale and the U.S. has several plants running trials. We need to make production of oil from oil shale a national priority, putting major resources into getting plants set up and producing. If the U.S. makes this a national priority there is no reason why the U.S. could not be energy self-sufficient within 20 years and even become a net exporter once again. Think about that, instead of being the worlds biggest importer of oil we could become one of the worlds biggest exporters. So what would THIS do for our national security?

liberals Hate America said...

Thia is a lagre resource that could pan out in Americas favor

Coal is the solution for driving down alarming energy costs. Through today’s Btu Conversion technologies, the energy in coal can be transformed into transportation fuels, using about one ton of coal to make two barrels of diesel, gasoline or jet fuel. Experts believe that coal-to-liquids technologies are competitive at equivalent oil costs of $35 to $40 per barrel. And America’s vast coal supply is far greater than the proven oil reserves in Saudi Arabia.

Through a process called liquefaction, coal can be transformed into zero-sulfur liquid fuels that are cleaner than today’s fuels. The technology has been used for the refining, chemical and power industries for 50 years. Germany has used the technology for aviation fuel and petroleum, and South Africa uses the technology for synthetic gasoline and diesel. And China has earmarked tens of billions of dollars to develop coal-to-liquids and improve its energy security.

Keith Richards said...

You are right about coal. Many people don't know this but the technology has been around since at least WWII when Germany used it to produce fuel for the Nazi war machine. And the U.S. does have some of the largest coal reserves on earth.

But as I mentioned above oil shale is also a very rich resource. Oil shale has so much oil in it that a ton of typical oil shale can produce more $$$ worth of oil than a ton of average gold ore produces $$$ in gold. And one company doing the testing on extraction estimates that it can be done for as little as $10 per barrel, which means it will be economical even if oil prices make a major drop.

Unfortunately, I don't know what the cost factor on coal to oil is but I've always heard that the U.S. does not do it because the process is too expensive.

liberals Hate America said...

Excellent article from the American Thinker. You are correct we need to start to some thing ASAP. Conservation will work up to a certian point.


A Proven Way to Lessen Dependence on Foreign Oil
September 4th, 2006

Until recently, the plan (such as it is) for reducing America (and the world’s) dependence on oil from foreign sources, mainly in the Middle East, has been to find more sources of domestic oil and oil from friendlier, non-OPEC countries. This hasn’t been a terrible strategy in theory, but the political left has hampered this effort by refusing to allow drilling in such places as ANWR and the Gulf of Mexico. But the number of undiscovered or untapped oil resources close to home does not appear to be not as abundant as we would hope.

America still remains the third largest producer of oil in the world behind Saudi Arabia and Russia, but its thirst for oil cannot be quenched by domestic supplies alone. America now imports more oil from Canada than from any other country, but that still is not enough.

But all is not gloomy. In fact, a technology was developed in the 1930’s – by the Nazis – to produce oil from coal. Coal is one of the most abundant fossil fuels in the world and can be mined relatively easily. Tennessee, Kentucky, West Virginia, and Montana have huge reserves of coal. And now, the governor of Montana wants to take that old technology and use it in America to produce oil for less cost and from domestic sources.

“Gov. Brian Schweitzer believes Montana could produce oil and other petroleum products from the millions of tons of coal reserves it owns in southeastern Montana.”

Montana has 2.4 billion tons of coal, which could produce mass quantities of oil for years to come. The cost is relatively reasonable too, about $30-$35 per barrel of oil from coal. That’s a lot more reasonable than $70 from Saudi Arabia, especially when it probably only costs them $5 to produce, leaving a healthy profit to donate to extremists around the world.

But get this,

”[t]he coal-conversion process produces no air pollution, uses no water and creates electricity as a byproduct. The petroleum fuels produced could be shipped out of state by pipeline.”

What are we waiting for? I’m not one for conspiracy theories, by any means, but if governments in Canada, the US, and Europe don’t jump all over this then I’ll start believing in a huge conspiracy with Exxon Mobile, BP, Shell, and every other company that’s been milking us on high gas prices for the last few years.

Of course, there will be detractors and opposition to this new source of energy. Global Warming Theorists will tell us that the coal is the dirtiest of fossil fuels and that we need other cleaner options, or that coal mining will destroy environmentally sensitive areas, yadda yadda yadda. But the fact remains that alternatives to oil are not available at this point in history. While it would be great if we could all use fuel cells, wind and solar power, and bio-diesel, the feasibility of using such energy sources is not great in quantities sufficient to make a big difference. An option now exists that is comparable or cleaner to traditional oil refining that can free us from foreign sources, and that’s a start.

So how does coal liquefaction work?

“What you do first is the coal gasification process,” Gov. Schweitzer said. “You crush the coal up, heat it and get your gas. From there, it’s a chemical reaction. You have a big tank and use either cobalt or iron as the catalyst. What you get out of that is the building blocks to make fuel. You get carbon monoxide and you get hydrogen. With those two, you can make any fuel you would like to make – diesel, gasoline, heating fuel, plastics, fertilizer or pure hydrogen.”

Its not just Schewitzer who finds this interesting, the Chinese do as well. China plans to launch a coal-liquefaction program in the next 5 years.

“Generally speaking, 2 tons of coal can turn out 1 ton of oil,” explained Shu Geping, a senior engineer of the China Coal Research Institute.(source)

In South Africa, they’re already making it work:

“South Africa, whose structure of energy reserves is similar to China’s, has established three coal liquefaction manufacturers with total investment of US $7 billion in 1950. In 1999, these manufacturers registered a profit before tax of US $610 million.”(id)

So we have a proven technology that works and will save us money. The refining process does not pollute, and we can eliminate our dependence on Middle Eastern energy. What are we waiting for? Such possibilities should result in a national effort to change the way we produce energy. This is essential for our future security and the well being of future generations. Not only that, but not having to buy oil from corrupt regimes in the Middle East would eliminate huge amounts of money that are funneled to terrorists each year.

The benefits would extend to South America as well, the Chavez government would have less money to sustain its corrupt political machine and might be replaced by a pro-American government which believes in free trade and integrity in government. Russia and China would have less need to appease the tyrannical regimes in the Persian Gulf for the sake of their own energy security; they could start their own coal liquefaction programs since both nations have huge reserves of coal. Germany, Britain, France, and other European nations would no longer be tied to Arab oil either, and the Japanese could buy from Russia, America, Canada, Britain, Germany, or other coal-rich country.

The potential for a new world exists with this old technology. Whether that world would ultimately be safer than our current reality is unforeseeable, but I think it’s worth a try. The status quo of energy dependence on OPEC and corrupt Gulf States does not have to continue. There is a way out, with old but proven technology.

Ronald Reagan once said,

“I call upon the scientific community in our country, those who gave us nuclear weapons, to turn their great talents now to the cause of mankind and world peace: to give us the means of rendering these nuclear weapons impotent and obsolete.”

Coal liquefaction might help make terrorism and Islamic-fascism obsolete by choking the manner in which they are fed. What better way to promote a new Middle East?

Jonathan D. Strong is the proprietor of The Strong Conservative.

liberals Hate America said...


From Wikipedia

If the price of a barrel of oil is under forty US dollars, oil-shale oil is not competitive with conventional crude oil. If the price of oil were to remain over forty dollars a barrel (with no chance of declining, which could be the case if oil shale were to be exploited on a large enough scale), then companies would exploit oil shale. Generally, the oil shale has to be mined, transported, retorted, and then disposed of, so at least 40% of the energy value is consumed in production. Water is also needed to add hydrogen to the oil-shale oil before it can be shipped to a conventional oil refinery. The largest deposit of oil shale in the United States is in western Colorado (the Green River Shale deposits), a dry region with no surplus water. The oil shale can be ground into a slurry and transported via pipeline to a more suitable pre-refining location.

Keith Richards said...

Several different companies are working on new technology to bring the cost of producing oil from shale down. One company claims it can do it for much less than $40 per barrel. This was just reported in a news story about 3 weeks ago.

Given the steady increase in worldwide demand it does not look like the price of crude oil is likely to average under $40 per barrel over the long term, although we may see a brief drop when the world economy slows down.

But even if the price did fall into the 30's it would benefit U.S. security to produce a significant quantity of oil from shale if for no other reason than to let OPEC know that the U.S. COULD live without their oil.

And in t I still believe that Americans should take reasonable steps to conserve energy, as the cheapest oil is the stuff that we never need to buy.