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Torched And Burned: Why Does Colorado Subsidize the World’s Most Profitable Industry?
Randy Udall, ASPO-USA
“Fossil fuels resemble capital in the bank. A responsible parent will use his capital sparingly in order to pass on to his children as much as possible of his inheritance. A selfish parent will squander it in riotous living and care not one whit how his offspring will fare.”
—Admiral Hyman Rickover, U.S. Navy
Coloradans pride themselves on being fiscally conservative. In this cash-strapped state, legislators squabble over quarters and governors take deficits for granted. But there’s a paradox here: Even as we suffer migraines over how to fund education, transportation, and health care, Colorado has, in effect, left more than one billion dollars on the table since 2002. How is that possible?
The lower line in the chart below shows the oil and gas severance taxes the State collected between 2002 and 2006. The upper line represents the taxes Colorado oil and gas producers would have paid had their wells been located a few hundred miles to the north in Wyoming. The cumulative difference, over the five years, is $1,300,000,000.
Read the rest of Randy Udall’s Torched And Burned here (pdf file)
(15 October 2007)
Casualty of high oil prices: oil firms
John Wilen, Associated Press
Drivers aren’t the only ones being squeezed by record oil prices. A surprising casualty of the escalating cost of crude and sagging pump prices turns out to be the oil industry itself.
Even as oil futures set a new record north of $84 a barrel last week, a number of refiners warned that their third-quarter profits won’t be as robust as once expected.
That’s not to say they are destitute. Profits at the nation’s three largest oil companies — Exxon Mobil Corp., Chevron Corp. and ConocoPhillips — are forecast to drop 8.8 percent to $17.7 billion for the quarter that ended Sept. 30, compared with earnings of $19.4 billion in the same period last year, according to analysts surveyed by Thomson Financial.
The major reason is falling refining margins, or the difference between what refiners pay for oil and what they are paid for the products they make from it.
(14 October 2007)
Former Shell executive accuses oil firms of ‘hypocrisy’ over human rights
Lianne Gutcher, Sunday Herald
Firms condemned for failing to back up ethical policies
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THE DEALINGS of oil companies in countries such as China and Burma have led a former Shell executive to accuse his ex-employer and its rivals of “hypocrisy” in regard to human rights.
Paddy Briggs, who worked for Shell for 37 years before retiring in 2002, has criticised oil giants for continuing to be involved in countries accused of human rights abuses, despite issuing statements insisting they support those rights. Briggs cites Shell’s involvement in China and Saudi Arabia, and Total’s investment in Burma as examples of this hypocrisy.
In an article entitled The Myth Of Corporations’ Commitments To Human Rights, written in advance of a speech he will give at a PR conference in Dubai next month, Briggs wrote: “The contradictions between rhetoric and actions have to be avoided. There is, frankly, no point in having your PR department issue commitments’ on the one hand, while business managers go their own sweet way in ignoring these so-called assurances on the other.”
…Briggs insisted that he has no axe to grind. He said his speech at the Public Relations Congress in Dubai, at which the UK goverment’s former communications chief Alastair Campbell is also billed to speak, will also include references to corporate communications from Shell that he believes are positive.
(14 October 2007)
Trillions in spending needed to meet global oil and gas demand, analysis shows
Associated Press
Companies that produce, refine and transport oil and natural gas will need as much as $21.4 trillion (€15.04 trillion) in capital expenditures between now and 2030 to meet sharply growing global demand for hydrocarbons forecast by experts, a new analysis shows.
Larry G. Chorn, the chief economist for Platts, which provides energy and commodities information, said Monday the tab for capital spending is likely to exceed $1 trillion (€0.7 trillion) annually in 2016 and $2 trillion (€1.41 trillion) in 2026 as the industry tries to satisfy surging consumption in the U.S. and abroad.
The bulk will go toward exploration, development and maintenance of the crude oil supply, the Platts’ analysis says. Refining and transportation will account for the remainder.
(15 October 2007)
