ODAC Newsletter Nov 23

Brent oil fell for a second day in London, paring a weekly gain, as a cease-fire between Israel and Hamas eased concern that tension in the Middle East will disrupt the region’s crude supplies.

Futures slid as much as 0.3 percent, matching yesterday’s decline. The cease-fire crafted by Egypt and the U.S. halted eight days of aerial assaults that ravaged the Gaza Strip and made Tel Aviv a missile target. West Texas Intermediate futures in New York have dropped since the Nov. 21 accord. There was no floor trading in the U.S. yesterday because of the Thanksgiving holiday, and electronic transactions will be booked with today’s trades for settlement purposes…

China appears to have stopped filling up its strategic petroleum reserve (SPR) — removing a big source of incremental demand from the global crude oil market…

The world’s largest oil-exporting countries have been asked to consider imposing a small carbon tax on oil as a way to break the deadlock over finance for poorer countries in the UN climate talks.

The Ecuador-led initiative, submitted to the Organisation of Petroleum Exporting Countries (Opec), could see a 3-5% tax levied on every barrel of oil exported to rich countries. This could potentially raise $40-60bn a year for the green climate fund, which is expected to be the principle route of funding for developing countries to adapt to climate change…

ExxonMobil on Wednesday became the fourth oil major in a month to warn customers over delays to Nigerian oil and gas exports, adding to a raft of problems for Africa’s biggest energy producer caused by oil spills, theft and flooding.

Royal Dutch Shell lifted on Wednesday its force majeure on Nigeria’s benchmark Bonny Light crude oil exports, easing some of the supply concerns…

When the International Energy Agency’s big annual report came out last week there was a big top line story picked up nearly everywhere: that US oil production will overtake Saudi Arabia by about 2020.

This is due to projected rises in oil being wrung from the sort of shale formations that have been the source of vast new supplies of natural gas in the past few years…

THE oil town of Fort McMurray gets a bad press. GQ magazine portrayed it as a hellhole of testosterone and tattoos, where drunken oilworkers shower strippers with cash and get into fights because there’s nothing else to do. Esquire called it "the little Canadian town that might just destroy the world".

There is a grimy grain of truth in such stories. Extracting oil from Alberta’s oil sands does indeed cause environmental problems. And Fort McMurray is a bit macho. It is a frontier town of ultra-low temperatures (-20°C is about average in winter; -51°C has been recorded) and ultra-high wages (average household income is C$178,000, which is also $178,000). The population is mostly young and male. Some do indeed prefer more raucous entertainment than say, joining a book group to discuss "Eat, Pray, Love". "I wish they’d ban truck nuts," sighs a female resident, referring to the toy testicles with which some young men decorate their trucks…

EU politicians rejected a ban on shale gas, while calling for a robust regulatory regime to address environmental and other concerns, in a series of votes on Wednesday in the European Parliament.

A shale gas revolution has swept the United States, lowering gas prices and helping to displace more polluting coal…

Have the benefits of "fracking" as a way to extract natural gas been exaggerated? Australia’s biggest such operation is showing larger than expected leaks of methane, reveals research submitted to a government inquiry.

Burning natural gas, which is mostly methane, creates less carbon dioxide than burning coal. Traditionally accessed deposits are shrinking, so fracturing shale beds to release more gas has become popular. But since methane has a heating effect 25 times greater than that of CO2, accidental leaks could undo the benefits…

The chief executive of Royal Dutch Shell has backed the Government’s "dash for gas", saying that the fossil fuel is abundantly available, environmentally friendly and will provide energy for the next 250 years.

Peter Voser said gas was a fuel for the future and that Shell would be investing $20bn (£12.6bn) in the sector between 2012 and 2015…

More than 1,000 coal-fired power plants are being planned worldwide, new research has revealed.

The huge planned expansion comes despite warnings from politicians, scientists and campaigners that the planet’s fast-rising carbon emissions must peak within a few years if runaway climate change is to be avoided and that fossil fuel assets risk becoming worthless if international action on global warming moves forward.

Coal plants are the most polluting of all power stations and the World Resources Institute (WRI) identified 1,200 coal plants in planning across 59 countries, with about three-quarters in China and India. The capacity of the new plants add up to 1,400GW to global greenhouse gas emissions, the equivalent of adding another China — the world’s biggest emitter. India is planning 455 new plants compared to 363 in China, which is seeing a slowdown in its coal investments after a vast building programme in the past decade…

Fossil fuel-fired power stations with carbon capture and storage (CCS) technology could produce electricity as cheaply as nuclear and renewable energy technologies by the end of the decade, a government-backed report has concluded.

The sector could generate electricity at around £100 per megawatt hour (MWh) by the early 2020s and "significantly below" that point soon after, according to interim results to be published today by the CCS Cost Reduction Task Force, a collaboration between the Department of Energy and Climate Change (DECC), The Crown Estate, and industry…

The government has published details of its long-awaited Energy Bill, designed to keep lights on and emissions down.

The government will allow energy companies to charge households an extra £7.6bn, to go towards low-carbon electricity infrastructure by 2020…

Households will be offered a choice of just four gas and electricity tariffs as they have been "paying more than they need to" for too long, the Energy Secretary has said.

In radical reforms, Edward Davey today called a halt to the confusion caused by hundreds of different rates on offer…

The country’s "first" commercial-scale biomethane plant connected directly to the grid was opened by The Prince of Wales yesterday.

The 5MW anaerobic digestor should be capable of supplying renewable gas to 56,000 new-build homes when at maximum capacity in the summer with output falling by around 4,000 homes in the winter…

Good Energy will today unveil a new electricity tariff offering people living near its wind farms discounts on their energy bills in a bid to boost the benefit communities get from hosting turbines.

The independent utility will launch the local electricity tariff early next year for any customers living within two kilometers of a Good Energy wind farm with a capacity greater than 4MW…

The Conservative MP Peter Lilley, one of only three MPs who voted against the Climate Change Act, has received share options worth at least $400,000 from an oil company, Guardian analysis has revealed.

Lilley’s links to the oil industry have long been declared by the former cabinet member. But the revelation about the full extent of his financial interests will place him under further scrutiny in his new role as a member of the Commons select committee on energy and climate change, which will be quizzing the energy and climate secretary, Ed Davey, about the energy bill on Tuesday…

The World Bank has warned failure to act on climate change has sent the planet "barrelling down a path" to flooded cities, intense storms, heat waves, and food and water shortages.

But it says such a desperate scenario can still be avoided through the smarter use of energy and resources, if only governments are prepared to be more "aggressive" in tackling climate change.

Turn Down the Heat, a report prepared for the bank by the respected Potsdam Institute for Climate Impact Research (PIK) and Climate Analytics, says global mean temperatures are now about 0.8°C above pre-industrial levels and are set to be 4°Celsius warmer by end of this century…

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The concentration of greenhouse gases in the atmosphere reached a record high last year, according to the latest figures from the World Meteorological Organisation (WMO).

The volume of CO2 reached 390.9 parts per million in 2011, after increasing by an average of two parts per million per year for the past decade…

Carbon pricing policies can help countries raise revenues, cut their deficits, and reduce their emissions without impacting negatively on growth, a group of academics have said.

Energy and carbon taxes cause less of a drag on GDP and employment than labour taxes and other indirect taxes, such as VAT, according to a policy paper published this week by the Grantham Research Institute on Climate Change and the Environment and the Centre for Climate Change Economics and Policy…

A coalition of the world’s largest investors called on governments on Tuesday to ramp up action on climate change and boost clean-energy investment or risk trillions of dollars in investments and disruption to economies.

In an open letter, the alliance of institutional investors, responsible for managing $22.5 trillion in assets, said rapidly growing greenhouse gas emissions and more extreme weather were increasing investment risks globally…