Going...Going...

The picture you see is the construction of another offshore oil production/drilling platform at Stavanger, Norway.

Nice!...

Wish it was here!...

The reality is now that, we have about six days left to get Exxon/Mobil, Chevron and the rest of the consortium back to the bargaining table and get a deal signed for the development of the Hebron-Ben Nevis oil field.

Reading an article in the New York Times on the stand that the Newfoundland and Labrador government has taken in negotiations has got me thinking about the implications of what is going to happen in the immediate St.John's area in the coming months,let alone the rest of the province. Already, I've noticed that the "for sale" signs are on the lawns a little longer and real estate agents are starting to have backed up inventories of properties that can't be moved.
You might have to register with the Times to get it.
See Danny's interview with the New York Times here:http://www.nytimes.com/glogin?URI=http://www.nytimes.com/2006/06/14/business/worldbusiness/14oil.html&OQ=_rQ3D1&OP=35854415Q2FQ27Q3BVzQ27RQ51!HbQ51Q51pkQ27kQ3CQ3CQ7BQ27Q3CQ7BQ27-Q2AQ27zPHatVHHQ27Q3BQ51b8RzPHatVHHQ27-Q2AQ51a8Q2B)pF8

It's the last line of the story that gets to me and I'll quote:
"I'm independently wealthy, so I'm not in the pay of any particular group or industry.I'm able to take tough stands"...

Trouble here is that, the common joe here is not independently wealthy,but we'd certainly like to have the chance".....

It's getting just a little bit slower in the taxi too...

If the deal gets shelved in six days time, cabbies in the St. John's area will have another couple of dry years where no one cares. I'm sure they remember the days of heading up to YYT and picking up the odd $140.00 fare to Bull Arm from someone freshly landed. The construction jobs at Bull Arm kept the Avalon and surrounding areas humming.

If the deal dies, so does the four billion dollar construction project for a new offshore platform.

My sources in Texas tell me it would have been the first of two.

Work gone, the chance to advance the province and to keep some of our kids home for a change. The chance to do something POWERFUL for a section of rural Newfoundland and Labrador. The longer it sits under the waves, the more likely we'll lose the construction project and the more likely that the companies will "glory-hole" the project and use the Hibernia platform to get the stuff up from the seabed.

Gone is another opportunity to advance the cause of building an oil industry, but perhaps Danny wants to do the deal on his own?....Lower Churchill...Hebron...What's next?...Orphan Basin?

Just where does the government draw the line on who has the right to the resource?

It's six days and counting...

It's the Final Countdown...

School is out this year on June 21st, not long away now, and it's been a heck of a year.

God knows it's been a hard one both for students, teachers, and parents.

For some it is also a day of reckoning for,when the end of the year comes, there won't be anything left to hold back some oil company employees who traded houses in places like Calgary,Alberta to start a new life amidst the prospects of founding another major oil field off the coast of Newfoundland and Labrador.

For when the school year ends, so will the prospects of those same families staying in Newfoundland. The arguement has been made that, maybe the Premier was playing a little too hard when it came to negotiations for royalties and other benefits from our resources and that's what has caused all the problems. The Hebron-Ben Nevis deal will die a slow and inglamorous death at the hands of a few who pushed just too hard.

What I hear is that the provincial government drove hard to have royalties paid out on the oil type there at $40 a barrel US while the oil companies agreed to $50 bucks a barrel, a $10 a barrel difference. That's what might have caused the province to lose a $4 billion dollar offshore platform that was just a little smaller than the Hibernia platform itself.

That's not all...

My sources in Texas also tell me that there was to be a second platform constructed immediately after the first was completed...

How much did we lose?....Really...

While an Irish billionaire explores the Placentia Bay area for a suitable site for a refinery and the world thirsts for our resource, did we let loose the dogs to play in someone elses yard?

Did we let the "kids out from school" without learning from them ourselves that, we could have had so much more in the way of benefits like keeping our kids here to work. Did we founder away our human resource to keep our natural resources in the ground?

Has the chance for a major step into the petroleum development field been thwarted by $10 bucks a barrel that couldn't have been negotiated to rise if the price of oil again rose along with it?

We've forgotten about escalator clauses my friends, and a St.John's lawyer was the first one to forget.

We've got until June 21/06 to get negotiations up and going again or it's going to be hard times on the Rock in another year or so. Get the adults in government and Chevron back to the table now before the kids get out of school because if not, we'll lose a lot more than royalties on $10 bucks a barrel.

As of today, we've got 7 days left to save it ...

Al-Zarqawi Pays His Price

The man at the left got bagged today by the US military in a precision strike that was aimed at taking this character out in the first place.
Responsible for Gawd knows how many deaths, alledgedly he also was leading insurgents in attacks on Iraqi oil infrastructure.
Funny darned thing...
Every time you get a little positive news in the oil markets,there's always something that screws things up to the consumer.
When his "passing" was first announced this morning, oil prices, in electronic trading, lost well over $1.50 US on a barrel.

Lo and behold, the New York Mercantile Exchange opens and what happens?...
Oil is down today by .47 to it's close at $70.35US a barrel.

Gawd love the whole notion of security of supply and terrorism concerns that were expressed in the markets overseas this morning. Gone was the larger than expected drop that should have been seen in the markets in North America.
Gone is the notion that a "little good news" like this should have to the consumer and, gone should be the notion that we sit and not see anything done about it.

Is the exchange in New York the problem with pricing in itself?

I dunno about that but, I think we all know that there are huge commissions being paid out to keep them up!

Regards,

George

Surely,The Gods Are Laughing!...

$80 Bucks US is a Distinct Possibility Compliments of Bush

Here we go again!...

It must be pre-ordained that,if your father has been president,or another president has unfinished business,then you have to step up to the plate.

The price of oil is hitting the roof today because the joker on the bomb just happened to be picking the Iran nuclear program as a possible scenario for the use of a strategic nuclear weapon.The picture immediately to the left is missing the strategic oil target it's meant to hit and not some forlorn railway crossing in the middle of nowhere...

The simple fact that Bush has alledgedly had his generals talk about a "strategic" nuclear device-a bunker buster type bomb- to destroy Iran's nuclear facilities means one thing-that the US has so far over-extended itself that it sees no easier way to try and win an arguement.

In all this should be stark and staring warnings that something is amiss with the people who thought this one up.

I think it was James Madison who said, and I quote...

"No nation could preserve it's freedom in the midst of continual warfare"

Attention America because George W. has you surrounded!

Do you know what the president is doing or,as a matter of fact,does anyone?

Everytime I go to the pumps,I wonder...

Why is it that we can't sit back and see what the United Nations is ready to do before we let the "Bush Factor" weigh in on the world situation?

The reality here is that I'd rather see United Nations influence on oil prices rather than ol' George W.

What we're witness to is an Iraq repeat performance.We just don't know when the show starts.

Only George W. knows that one...

Did Danny Overshoot the Runway?...

I'm just here going through my numbers and some long dusty facts on oil.

I'm thinking tonight and it hurts...

Did we just bear witness to the shutdown,at least on a temporary basis,the burgeoning offshore oil industry in Newfoundland & Labrador?

Knowing that super royalties were to be paid in the eventuality that the oil industry were to walk into

Hebron-Ben Nevis and develop the field,was it that attractive for Danny to want to walk in and try to scoop the companies when the hard work was already done?

When was the last time you were given equal share in a company after it started to profit and expect to get in at a bargain basement price?...

A possible shutdown of the field until prices rebound is a possibility but the fact that the Newfoundland and Labrador government now has an equity position means that it would in fact,lose an awful lot of money should prices collapse...

And we'd have nothing to show for it...

The Newfoundland & Labrador government should just stay out and stick to putting it's royalty monies into the things we truly need-a vibrant economy that's crude oil and fishery based,and pay for the things we elect members to get for us.

The ground work was already set and we now have Hibernia,Terra Nova and White Rose.

Hebron Ben Nevis was a hard nut to crack with the possible construction of a $4 billion dollar gravity-based structure set to start soon until Danny wanted a part of something he played no role in.

And at $65 bucks a barrel we could have had $10 billion dollars in the bank...

The realities of crude prices falling is remote at best unless the world condition changes and until that happens we're likely to have been witness to the loss of more than the $10 billion conservative estimate of royalties.

Isn't that the total debt of the province as we know it?...

And,if we,as consumers,are to get our hands on a safe,secure guarenteed supply of crude oil into the North American market and become the hinge by which OPEC dependency is to be broken then perhaps Danny and the Tories along the east coast should keep their hands out of the cookie jar.

Make an investment into the reasons WHY oil companies should set up shop here and we'll be all the better for it...

The interest was here....at least,up until yesterdays news...

Shoot First and Answer the Questions Later...

Seems that the sky's the limit when it comes to the government raking in bucks from taxes on heat doesn't it?

That is,until today...

Bernard Lord,the Premier of New Brunswick just saved our Consumer Group a heck of a lot of work and may very well have landed himself in hot water with the other Atlantic Canadian premiers.

Why?

My understanding of the HST Agreement signed between the Canadian federal government and the provinces of Newfoundland and Labrador,Nova Scotia and New Brunswick was that no province could make a change to it's taxation without the consent of the other co-signees to the initial Agreement.

The reality of it all is that if Mr.Lord weren't in a minority government position this "Energy Policy" renewal probably wouldn't have happened-a time when he has a tenuous hold on power.

The Agreement,signed to in 1997/98 was meant to lower taxation levels on all consumer items but it ended up taxing items that never had a level of provincial taxation as well.Some of those items included heating oils and electricity,two of the most important winter needs a Canadian could have.

It's also a health concern...

On March 28/01,ironically the same day five years earlier,our group called the Consumer Group for Fair Gas Prices also had a petition for the removal of taxes off "heat" presented in our local House of Assembly.Some 55 thousand people over a stormy 3 weekends and also online,signed the petition.It was one of the most heavily signed petitions that was ever presented and garnered in the province to that point.

Fast forward to Nova Scotia this past couple of weeks where one Mr.John Hill of Dartmouth,Nova Scotia is literally working from the end of his driveway in getting people to sign his petition for the removal of taxes off "heat".

We've also helped Mr.Hill in his drive by posting his petition at our website and,so far,some groups from the outlying areas of Nova Scotia have increased the odds of the goal being reached there.

Thanks to Lloyd and crew in Cape Breton,Mr.Hill also has a group going door to door to get names to present this coming few days.

We're almost there!...

This is an opportune time and one I wouldn't have missed for the world...To find Atlantic Canada in a situation where there are three Tory governments and all of them being forced to work with each other for the benefit of the consumer!...

With all the revenues that Nova Scotia and Newfoundland and Labrador have coming in from $65 dollar a barrel oil right now and all the revenues renewed from the Atlantic Accord...Tell the truth now....Should we have been made to wait this long only to hear Bernard Lord make the announcement first?...

That's a Tory for ya!....

Moratorium on Refinery Closures Needed....

Hurricane Katrina should have hard lessons...
In the wake of the hurricanes that struck the refining centers on the coastal areas of the Gulf of Mexico last September,the consumer was left at the whim of the mercantile exchanges in North America.
For more than a few days,consumers paid through the hilt for petroleum products that we came to be dependent upon in our daily lives.
Maybe we're complacent?...
Fact of the matter was that,with ever increasing demand,we were left "shortchanged" for something we came to need on a daily basis.
Why?...
In the recent past,especially in Canada,policies more commonly known as "reciprocal sales arrangements" allowed for the sharing of inventory between companies and that,in itself,allowed for the closure of refineries.Companies didn't have to have a refinery in it's company operations if it were found that supply could be acquired elsewhere.In this case,it was off the company it was supposed to be competing against!
Seems odd doesn't it?...
The latest refinery closure in Canada was a facility in Sarnia,Ontario where,according to the release at the time,it was too expensive to change the refinery to something a little more environmentally friendly and,as a result,some 300,000 barrels a day of "capacity" was removed from the North American and Canadian markets...
Right!....

I can think of several refineries in Atlantic Canada that have shut their doors and packed up and moved to the Middle East,closer to their sources of supply,Dartmouth's Ultramar facility and the old "Golden Eagle" facility in Holyrood Newfoundland and Labrador to name two...

That's just in Canada...

While it may be argued that refiner margins were very low in the late 90's and into the 2000 years,it also had to be argued that refining isn't the only branch that consists of the makings of an oil company.An oil company encompasses everything from the exploration end of the industry down to the sale at the pump and the industry has long forgotten it's responsibility to compete let alone support what it entered into in the first place.

The hard,object lesson of the hurricane season should be dire warning that governments on both a federal and state/provincial level should both place a moratorium on any refinery closures in the future and also that it should pursue the construction of new refineries close to their sources of supply.

Be it on the Grand Banks of Newfoundland and Labrador,Sable Island resources off Nova Scotia or the vast resources of crude oil in Alaska,not a drop of crude oil should sail for the hurricane ravaged refining areas until Big Oil recognizes the tenuous situation it has put the consumer into.

Secondary processing is a must and Big Oil needs to move from the Gulf of Mexico...

It's something I've been calling for now for a long time and,now with the advent of "Hurricane Syndrome" on the markets of the New York Mercantile Exchange raging already this spring,it's something finally being thought about by the people looking after the resources on behalf of their people.

After all,it's about time isn't it?...

GASOLINE TO SKYROCKET THIS SUMMER?...THIS TIME WE DESERVE IT!...

I'm sitting here wondering after all the years I've been monitoring pricing,why analysts are basing futures gasoline pricing on a simple fact that there's not enough ethanol on the markets...
There's plenty of gasoline coming into North America.
According to the US Energy Information Administration,imports of fuel are way up compared to last year at this time and gasoline supply sits slightly higher than where it was.
Market speculators are saying right now that the fear of lawsuits from the use of an additive called MTBE (Methyl Tertiary Butyl Ether) a known carcinogen and the ruination of the Santa Clara California water supply,in gasolines as an oxygenate,is forcing the oil companies into doing something that they should have done a long time ago-be environmentally friendly.
Ethanol,an alchohol by-product in the fermenting of corn,has been known now for a long time to be an acceptible additive to replace MTBE in fuels and has been known as such for almost 30 years.
Plenty of time has gone by for "Big Oil" to come to it's senses...
Or,is it "It's cents's"?...
Now a "motivator" in this summers upwards movement in prices,the ethanol industry in North America is set to boom and "Big Oil" is set to take advantage...
While doors may be starting to open for places like Newfoundland and Labrador for farmers to get into another possible industry or sideline,the simple fact remains that everyone has known for a long time that ethanol would be replacing MTBE as an additive and everyone just might be responsible for the "shortage" of gasolines we are told we might be facing this summer.
We as a people should be charging our governments with the mandate to ensure adequate supplies of ethanol in the future...
We let "Big Oil" have this round...
Pardon the pun but,it does sound "corny" doesn't it?...
Seems the only place that might have been ready for the production of ethanol was the state of Iowa who,as a necessity,came forward with a varitible side industry for corn because it simply grew too much of the stuff.
With the waning days of MTBE before us,let's hope Iowa can grow a heck of a lot more!

I'm a St.Mary's fisherman fishing St.John's

driving the city with the fishery gone

and like the salt water,people to go

waterhaul,waterhaul, haul-away o...

I cast out my net in waters bittersweet

same as I did but now from the street

My dory's a Ford that drives to and fro

waterhaul,waterhaul,haul-away o...

Just a bare living like my father before

I strain at the wheel like him at the oars

and I'm driving mad others go with the flow

waterhaul,waterhaul,haul-away o...

So,I'm headed home now with little in hand

just like from the waters where Dad took his stand

and just like the waters that wash to and fro

waterhaul,waterhaul,haul-away o...

George Murphy February 17/05

May I digress!
I wrote this one a while back about a fisherman who couldn't fish anymore and had to settle for crawling in behind the wheel of a cab to make a buck.

A waterhaul is a Newfoundland and Labraor fisherman's term for coming up with nothing in the net when it came time to pull it in.Cabbies here don't get a job to where they've been sent when they get a waterhaul.

Some might think that this is going to be the future of the fisherman if the offshore oil industry starts to take precident over the big bucks of the oil companies.I just couldn't resist posting this one!

Well,Well,Well,....And Not a Drop For Us...

It's the first time for me,getting into blogging but,sometimes you just have to get things off your chest and,I figured,if there was an unused medium that I never explored before,then this would be it...the way to go.Maybe I might even get a point across and a politico might listen?...Naw!
Gas and oil imparticularly,make an impression on me and that's the reason for getting into this,as another medium to "vent"...
For some reason I think I'm going to have fun with it...
In this little blog I'm hoping on giving you my reasoning for pricing the way it is,or what's not right with it and,believe me,if you only knew half the stuff I've forgotten,you'd know there's plenty!

I really don't know how I'm going to do this but,I figure that,what I would do is compose a list on a weekly basis of how the markets traded in oil and their influence on the consumer.I'll get into a lot about where the government,both federally and provincially,should be going with resources like extracted crude and what it can do to break it's dependancy on the outside influences,imparticularly OPEC,who just like to fool us all...
"Sky's the limit" it seems but,for the last eight years or so,I've learned a lot and,I hope to share what I know with you,all including issues of taxation and royalties on crude that coasts away from Canadian shores...
Whether you're in the Alberta oil patch, on the Hibernia platform or on the receiving end of our Newfoundland and Labrador crude in New Jersey,feel free to drop me a note...

Other than that,my verbal diarrhea starts from today...div>