Latest oil spill compensation case highlights need for better solution
MEXICO CITY — March 3, 2016 — Shell is being sued over oil spills by two communities in Nigeria, both claiming they need compensation from the multi-national energy company in order to clean up their land. They claim that since 1989, successive and uncleaned oil spills have prevented their communities from having clean drinking water or farmland.
According to a November 2015 report by Amnesty International, there are four spill sites Shell claimed it would clean up that are still contaminated. The first court hearing at the Technology and Construction Court ruled that the claimants can bring a case against Shell’s Nigerian business, known as Shell Petroleum Development Company of Nigeria (SPDC).
Marco A. Attisani, founder and CEO of Watly has commented that oil and gasoline represent a serious hazard that can cause significant pollution and contamination when systems fail. He said compensation is necessary but a short-sighted solution in light of newer, cleaner energy sources and advances in technology.
Crude oil shipments by rail from Midwest to coastal regions decline
WASHINGTON — March 11, 2016 — According to the U.S. Energy Information Administration, (EIA) the movement of crude oil by rail within the United States reached a high of 928,000 barrels per day (b/d) in October 2014. This includes shipments within Petroleum Administration for Defense Districts (PADDs), with most originating in the Midwest and going to the East Coast, West Coast and Gulf Coast regions.
Since October 2015, crude-by-rail volumes have declined as production has slowed and as crude oil price spreads have narrowed, while more pipelines have come online.
The economics of moving crude by rail depend largely on significant domestic crude discounts compared with international crudes. Because domestic crudes are no longer priced significantly less than waterborne crudes, there is less of a cost advantage for costal refineries to run the domestic crudes. The narrower the spread between domestic and imported international crude oil, the more likely costal refineries will choose to run imported crudes rather than domestic supplies shipped by rail.
U.S. ethanol exports exceed 800 million gallons for second consecutive year
WASHINGTON — March 10, 2016 — U.S. exports of fuel ethanol exceeded 800 million gallons for the second time in four years in 2015. This totals 844 million gallons, which is nearly equal to the 846 million gallons exported in 2014.
U.S. imports of ethanol totaled 73 million gallons in 2014 and also increased in 2015, reaching a total of 92 million gallons. The U.S. remained a net exporter of fuel ethanol for the sixth year in a row and exported to 35 countries in 2015, said the EIA.
Ethanol is primarily used as a blending component in the production of motor gasoline in the U.S. Corn is the primary feedstock, and large corn harvests have contributed to increased ethanol production in recent years.
U.S. ethanol demand was driven higher in 2015 because of increased gasoline consumption, which rose by an estimated 2.7 percent from its 2014 level, reaching the highest level since the record set in 2007.
Crude oil price forecast lowered
WASHINGTON — March 9, 2016 — The current value of futures and options prices contracts suggest high uncertainty in price outlook, leading the EIA to lower the crude oil price forecast.
The lowering of this Short-Term Energy Outlook (STEO) forecast reflects oil production that has been more resilient than expected in a low-price environment and reduced expectations for oil demand growth. The resulting inventory builds are larger than previously expected throughout the forecast period, which has delayed the expected rebalancing of the oil market and contributed to lower forecast oil prices.
If global storage capacity becomes stressed, the cost of storage will rise, reflecting more expensive storage options such as floating inventories on crude oil tankers. Additional uncertainty stems from the pace of global economic growth and its contribution to oil demand, and the responsiveness of non-OPEC producers to sustain low oil prices.
Milestone in growth of domestic natural gas production
WASHINGTON — March 4, 2016 — The first export shipment of liquefied natural gas (LNG) produced in the Lower 48 states on February 24 is a milestone that the EIA said reflects a decade of natural gas production growth. This growth puts the U.S. in a new position for worldwide energy trade.
U.S. natural gas production has grown each year since 2006 due to a rapid increase of supply from shale gas resources. This has led to a decline in domestic natural gas prices and rising natural gas exports, via pipeline to Mexico. Since the end of February, this now includes overseas markets via LNG tankers.
U.S. coal exports declined in 2015 with steady coal imports
WASHINGTON — March 7, 2016 — Due to slower growth in demand, lower international prices and higher output in other coal-exporting countries, U.S. coal exports declined in 2015. The U.S. remains a net exporter of coal, exporting 74.0 million short tons (MMst) and importing 11 MMst last year, according to the EIA.
Lower mining costs, cheaper transportation costs, and favorable exchange rates (compared to the U.S. dollar) continue to provide an advantage to producers in other major coal-exporting countries such as Australia, Indonesia, Colombia, Russia and South Africa.
U.S. coal exports are mainly shipped from six customs districts that accounted for 90 percent of U.S. exports in 2015. Norfolk, Virginia, the largest coal port, shipped 26.2 MMst of coal, accounting for 35 percent of total U.S. exports.
Tampa, Florida, overtook Mobile, Alabama, to become the largest recipient of coal imports in 2015.