Editors: Tom Whipple, Steve Andrews

Quote of the Week

“Total US oil reserves in 2017 exceeded a … 47-year-old record, highlighting the importance of crude oil development in shales and low permeability plays, mainly in the Southwest.” US EIA

Graphic of the Week

1.  Oil and the Global Economy

US oil production continued to climb in September with oil companies producing a record 11.47 million b/d, 1.98 million b/d higher than in September 2017 (it takes two months to get reliable numbers accumulated).  This rapid growth is raising concerns around the world about overproduction. Coupled with slower economic growth in China and Europe, the surge in production has resulted in a $25 a barrel decline in world oil prices during the last two months. New York futures closed at $50.93 on Friday and London closed at $59.46.

With gasoline prices down by 30 cents a gallon and approaching $2 in some states, President Trump is calling for even lower prices, calling the rapid price decline “a big Tax Cut for America and the World.”  If many shale oil drillers were unable to make a profit with oil at $75 a barrel, then they certainly won’t with $50 oil. The same holds true on the international market where $60 oil is well below what many exporters need to sustain their national budgets.

With US oil production doubling since 2008, America’s economy has received a substantial economic boost with the opening of new export markets for US-produced oil and gas. With the help of the additional boost from the recent tax cut, the US economy has been doing well of late, but there are signs that this may be coming to an end.

For the immediate future, much depends on what the OPEC-Russia coalition decides this week. If they can make real production cuts sufficient to reverse the increase in world crude inventories, and force prices higher, then we could see the oil industry continue to grow. However, it was only four years ago when an oil price slide sent crude down from $110 a barrel to $30. This drop in prices led to a reduction of employment in the US oil industry by more than 160,000 workers, bankrupted hundreds of small drillers, and caused problems for the firms supporting the oil industry.

Even though most expect OPEC to cut output this week, a recent Reuters poll shows oil analysts are increasingly pessimistic about the prospect of a price rally next year, when the outlook for demand is uncertain, and supply is growing rapidly.

When the price of crude oil goes through one of its periodic downturns, as it is doing now, it sends a shiver through the oil industry.  History promises that higher prices will return.  Until then, US shale companies are under severe pressure, and big oil companies wonder about the viability of new projects.  There is more to worry them this time: not just the 29 percent fall in the price of Brent crude but the fear of this bear market enduring.

The OPEC Production Cut: Many observers are saying that decisions reached at the G20 meeting held over the weekend will be more important than what is decided at the OPEC meeting in Vienna on Dec. 6-7.  The Saudis are facing a major decision: cut oil production and enrage Donald Trump who is helping them weather the Khashoggi crisis or keep pumping and risk ultra-low prices that will do great harm to their economy.  Moscow is becoming convinced it needs to reduce oil output along with OPEC but is still bargaining with Saudi Arabia over the size and the timing of any cut.

Many analysts expect this week’s meeting to culminate with an official statement that leaves the market uncertain over just how many barrels OPEC intends to take off the market.  That could result in a repeat of OPEC’s June meeting.  With oil prices rising rapidly, the group agreed to reverse course and increase output but offered nothing about the size of the cut.  This situation left the markets to wait for evidence as to what was going on with oil production

The OPEC/non-OPEC coalition may be counting on increasing troubles in the US shale industry to tamp down the rhetoric from US President Trump, who warned Saudi Arabia and OPEC several times to keep oil prices low to benefit the US.  Costs of producing conventional oil in the major oil-exporting nations are generally believed to be well below costs of producing fracked shale oil.

US Shale Oil Production: Despite much bravado from the industry, there is little doubt that prices below $60/b are hurting US shale producers and potentially strengthening OPEC’s hand to introduce tighter quotas.  Many US shale companies are already below their breakeven prices for production, with looming pipeline takeaway constraints in both the key Permian and Bakken regions.  Many have hedged their exposure for this year in the $55-$60/b range but weakening prices in 2019 remain a significant threat.  Meanwhile, crude inventories in the US keep rising, with the US Energy Information Administration reporting last week that there was a 10th consecutive weekly build in crude inventories.

Analysts are saying that many shale oil companies will likely cut spending budgets next year for the first time since the last price crash as crude spirals down again.  West Texas Intermediate is now selling just above $50 a barrel, down from averaging almost $67 this year through September.  This is the minimum price most big shale companies plan their growth around. Some companies will sacrifice production growth to keep a lid on expenditures, according to Wood Mackenzie Ltd. “Something has to give.”

While surging oil production in the Permian basin has helped crash oil prices, however, natural gas production is growing so fast that drillers are trying to give it away — when they can’t, they burn it off into the atmosphere. There is a pipeline bottleneck for crude oil, but there is also a shortage of pipeline space for natural gas. The glut has become so bad that next-day prices for gas at the Waha hub fell to a record negative 25 cents last week so that producers were paying to take away the gas.

There have been reports for some time that the “gas cut” from Permian Basin production is turning out to be larger than anticipated.  While more-than-expected-natural gas is better than nothing, too much changes the profitability calculations for Permian wells and generally brings less revenue than higher-valued oil.

The race to export US shale oil is about to get fierce, with at least nine proposed terminals angling for a piece of a very limited pie.  Within 18 months, new pipelines promise to carry an additional 2 million b/d to the Gulf Coast.  But the extra crude will arrive at a time when existing terminals in the Corpus Christi area can already offer only about 300,000 barrels a day of unused capacity.  Several of the proposed terminals are being designed to load a supertanker every other day, each capable of carrying 2 million barrels. More likely, only one or two new terminals are needed.

Lost in all the optimism for the future of Permian Oil production and the willingness to spend billions to take away the oil it is supposed to produce in the future, is the possibility that the finite number of “sweet spots” that can produce shale oil at economical prices will be running out in the next five years.

2.  The Middle East & North Africa

Iran: The impact of the US sanctions on Tehran’s exports is still up in the air. According to a Bloomberg analysis, the six-month partial waivers that Washington issued to Iran’s best customers still allows them to import 1 million b/d until next May without any reprisals from the US.  France or Germany are planning to establish a corporation that would handle the payments channel for trade with Iran under the US sanctions.  The payments channel would use a system of credits to facilitate compensation for goods traded between Iran and Europe—allowing some trade to proceed without the need for European commercial banks which could be sanctioned by the US.

Tehran has been selling its crude at a discount to maintain market share, and it will be difficult for importers to find crude at the prices they have been paying.  Countries such as Japan and South Korea have close economic ties to the US and are reluctant to go against Washington’s wishes.  Both seem to be importing Iranian crude below the levels allowed by the waivers and seem likely to comply fully with the sanctions next May.  India and China have different concerns.  China is opening new pipelines to Russia which will significantly increase imports from Moscow and reduce the need for Iranian oil.

India has more of a problem. For now, it has a waiver and has seen the cost of imported oil drop significantly in the last two months.  If prices climb in the spring as the sanctions become effective, New Delhi will have problems paying for its oil.

The China National Petroleum Corporation (CNPC) is replacing France’s Total in developing Iran’s multi-billion-dollar South Pars gas project.  After the US withdrawal from the nuclear deal, Total said it would not be in a position to continue the South Pars gas project and would have to unwind all related operations before November 4, 2018.  The Chinese state firm, however, has not started work on the project yet, as Iran has yet to hold talks with CNPC about when operations will begin, the minister added.

Before Total quit Iran, it had a 50.1 percent stake in the project and was its operator, while CNPC owned 30 percent, and Iran’s national oil company held the remaining 19.9 percent. The South Pars project is aimed initially at meeting Iran’s domestic gas demand.  Production capacity is envisaged at around 2 billion cubic feet per day of gas, with the project due to come on stream in 2021.  When fully operating, the project is also expected to deliver around 70,000 b/d of condensate.

Iraq:  Iraq’s crude oil exports from its southern ports on the Gulf will be around 3.3 million b/d in November, down from the 3.47 million b/d exported in October.  Iraq is OPEC’s second-largest producer after Saudi Arabia and pumps around 4.6 million b/d.  The bulk of Iraq’s oil is shipped via the southern terminals.

Baghdad has signed a $156.74 million drilling deal with China’s Bohai Drilling Co. for the West Qurna Two oilfield, two Iraqi oil officials said on Tuesday.  Bohai is to drill 28 production oil wells at West Qurna Two, operated by Russia’s Lukoil.  Production at West Qurna Two is now about 400,000 b/d, according to an oil official with knowledge of the field’s output operations. Iraq is in talks with Bohai to award it a second drilling contract for West Qurna 2, which could be worth up to $148 million.  Iraq is one of the last places in the world with easy-to-drill conventional oil fields and should be able to increase production provided it can build the infrastructure to export the oil.

Iraq has allocated its oil sales for 2019, with 67 percent of exports going to Asian markets, 20 percent to Europe and 13 percent to North America, the oil ministry announced last week. Earlier last month, an Iraqi official told Bloomberg that Iraq is intensifying efforts to build up its market share in Asia and aims to boost its oil supply to China by around 60 percent.  Iraq currently ships about 900,000 b/d to buyers in China and is ready to send some 1.45 million b/d next year.

The US wants to use its sanctions on Iran to move Iraq out of Tehran’s orbit but fears it could weaken the country.  Too much pressure could also backfire by ultimately driving Iraq closer to Iran, officials and analysts say.  The US granted Baghdad a 45-day exemption from Iranian sanctions, allowing it to keep importing natural gas.  Last week, a 6.3-magnitude earthquake in Iran’s western Kermanshah province near the border with Iraq injured more than 700 people. Tehran is trying to repair the damages to the gas pipeline to Iraq which supplies the power to generate 2,500 MW of electricity.  Iraq’s oil ministry is providing the power plants dependent on Iranian gas with fuel to keep them working during the Iranian supply halt, but there could be power cuts in provinces.

Saudi Arabia:  Saudi Arabia’s oil production has been at a record high this month— between 11.1 million and 11.3 million b/d on some days in November, but whether the Saudis pumped an all-time average monthly high will not be known until later this month.

Saudi Aramco will spend US$500 billion over the next ten years to expand internationally, with a fifth of the total amount earmarked for petrochemical projects and $160 billion for natural gas projects.  This investment would be separate from the $70 billion it is planning to spend on the acquisition of a majority stake in local petrochemical major Sabic.  This program will increase the Saudi’s natural gas production from a current rate of 14 billion cubic meters per day to 23 billion some of which is to be used for the production of petrochemicals.

The announcement of multi-billion-dollar investments in gas-related operations indicates a new move by Riyadh to make Saudi Arabia a major gas exporter. This ‘strategic pivot’ may come as a surprise, as Aramco is mainly known as a producer of crude oil.  The reality, however, is that the Kingdom has not only been quietly investing in upstream gas projects, it is also sitting on some of the largest natural gas reserves in the world.

The Saudi plan to build a nuclear power plant will speed up the Kingdom’s economic development as it would diversify its over-reliance on crude oil. “The decision to build a nuclear power plant in the kingdom is the result of serious research that confirmed the need for this step,” Saudi energy expert Said al-Shahrani said last week.  Earlier this month, Crown Prince Mohammed bin Salman launched several new strategic projects in the country, including one to build a nuclear research reactor.

Libya:  Libya’s crude oil exports to China are already worth twice as much as what it exported to Beijing last year, the head of the National Oil Corporation said last week.  Since January, exports to Beijing have amounted to $3.5 billion.  This compares with $1.7 billion for all of 2017 when Libyan fields were suffering regular outages.

Several crude oil terminals in Libya have been closed due to high waves, with oil production in the country already down by 150,000 b/d and likely to drop by a further 50,000 b/d, Libya’s National Oil Corporation said on Friday.  The state oil firm confirmed today that four oil port terminals—Ras Lanuf, Zueitina, Zawiya, and Es Sider—are currently non-operational.

In a surprise move, Algeria’s state oil and gas company has pulled out of Libya citing deteriorating security conditions.  Sonatrach had partnered with the Libyan National Oil Corporation to drill seven oil wells in Libya.  The Algerian company returned to Libya relatively soon after the 2011 civil war to explore for oil in the Ghadmes basin, where Sonatrach held a 25-percent stake that was awarded to it back in 2005.  In general, the security situation in Libya seems to be improving with an agreement between the Eastern and Western governments under discussion and European oil companies talking about making more investments in the country.

3.  China

Russia exported record volumes of crude to China in October as independent refiners continued to fill import quotas, while Iranian oil shipments fell on uncertainty over the sanctions on Tehran.  China’s imports from top supplier Russia jumped 58 percent from a year earlier to about 1.73 million b/d, marking the highest ever.  For the first ten months, Russian imports were 1.39 million b/d, up 16.6 percent.  Chinese customs last month began updating an online database with commodity imports by country of origin.

Iranian shipments, however, tumbled 64 percent in October from the year-ago month to 1.0496 million tons, about 247,160 b/d, ahead of US sanctions that came into effect on Nov. 4.  Month-on-month, imports from Iran in October marked their third fall in a row as China’s state oil firms came under growing pressure to scale back purchases ahead of the sanctions.

New Sino/American talks might focus on what both sides are calling trade “architecture,” a broad term that could encompass many issues the US wants Beijing to address, including intellectual property protection, coerced technology transfer, subsidies to state-owned enterprises, and even non-trade issues such as cyberespionage.  Over the weekend, the two sides agreed that in return for the suspension of US tariffs, Beijing would lift restrictions on China’s purchases of US farm and energy products.

China’s coal imports are set to drop in December as utilities wind back purchases following signals from Beijing that it will stop clearing shipments until next year.  Coal imports rose in the first 10 months of 2018 to 252 million tons, up 11 percent from a year ago and not far below last year’s total of 279 million tons, according to official data.

Residents of Jincheng in northern China’s coal heartland are enjoying cleaner air after campaigns to reduce pollution forced dozens of collieries and chemical plants to close.  However, Jincheng has paid a heavy price. Factories and coal mines have shut down, devastating the local economy.  The migrants have drifted away, and jobs are hard to find. Even the air is still not clean enough, falling short of the government’s pollution targets.  That means that as another anti-pollution campaign gets underway this winter, Jincheng will be under even more economic pressure.

4. Russia

Moscow’s position on an OPEC initiative to cut back on oil production in order to eliminate the growing oil glut and force prices higher was the top issue last week.  Early in the week, President Putin was saying that Russia is comfortable with the current level of oil prices at around $60 a barrel. The state budget is balanced at $40 oil price, and for next year, that budget-balance oil price is calculated at $43 a barrel according to Putin.

Gazprom Neft, Russia’s third-biggest oil producer, wants a production hike of 20 percent developing once-forgotten and depleted fields, key to its plans to increase its oil production by 8 percent to 2 million barrels per day.  A mandated cut in oil production would throw a wrench in these plans.  On Tuesday, Russian Energy Minister Novak met Russian oil companies to discuss cooperation between OPEC and non-OPEC oil producers and presumably the rapidly falling price of oil.  In recent years, a weak ruble has been of great help to the oil industry as revenues for exported oil comes in dollars and production expenses are in rubles.

With the Saudis taking the position that they won’t make a production cut alone and that rest of OPEC/non-OPEC coalition must participate too, Moscow had a difficult decision.  By week’s end, Moscow seemed to be coming around to the position that a production cut will have to be made at this week’s meeting.

Russia has emerged this year as a major player in the rapidly expanding market for liquefied natural gas.  Meanwhile, Moscow has been pumping gas into Europe at a record pace in existing pipelines, and to the East, it’s close to opening a major pipeline into China, the world’s fastest-growing major gas market.

Supplying natural gas to Europe, and increasingly to Asian countries like China and India, gives Russia hard cash and a seat at the geopolitical table.  “Our main goal is to preserve our current markets, primarily Europe, and to gain a foothold in new ones, especially Asia,” said Alexey Teksler, Russia’s first deputy Minister of Energy in an interview at his Moscow office.  A giant map of Russia’s gas connections to Europe and Asia covered one wall.

Gazprom will soon complete the bulk of the work for one of its most ambitious projects ever that involves building a natural gas pipeline from Siberia to its border with China.  The pipeline will ship 38 billion cubic meters annually of natural gas to China for 30 years.

5. Nigeria

Last week Nigeria’s energy ministers announced that plans to fix the country’s deteriorating refineries and make them work to capacity would not materialize until 2020.  This is contrary to the minister’s earlier claim that Nigeria’s refinery capacity will reach the expected 1.1 million b/d in 2020.  The minister said this would be achieved when Dangote Petrochemical’s new 650,000 b/d refinery, Nigeria’s four refineries of 450,000 b/d capacity are overhauled, and three modular refineries come on stream. Given Nigeria’s track record in building and renovating dying refineries it seems doubtful that the country will no longer need to import the bulk of its petroleum products by the year after next.

The local press is saying Nigeria will lose an estimated $6 billion in revenue to international oil companies, Shell and Eni, over the deal on the controversial oil block.  According to leaked emails and confidential documents, the oil giants might have used unethical means to secure the deal as they altered earlier terms on the oil block with the intention of depriving Nigeria of billions of dollars.  The report draws on an analysis from leading experts at Resources for Development Consulting commissioned by NGOs.  Two weeks before the deal was signed in 2011, the then Director of Department of Petroleum Resources advised the Federal Government not to accept the deal.

6. Venezuela

Rosneft’s chief executive, Igor Sechin, flew to Caracas last week to discuss with President Maduro the continuing delays in the shipments of Venezuelan crude that Caracas had agreed to send to Russia as repayment for cash loans.  Sechin brought information showing that Venezuela is meeting obligations with China but not with Russia according to a source of Reuters.  A Chinese delegation was also there.  Russia and China are pretty much the only countries left that are willing to help Caracas with US sanctions and falling oil production. China is the bigger benefactor, having loaned as much as $50 billion to Venezuela in recent years.

Venezuela has reached a settlement with Canadian gold miner Crystallex to hold onto its US refiner Citgo but will have to stay on top of payments through early 2021 to protect its ownership of the refiner.  PDVSA’s control of Citgo, the state-owned company’s most valued asset, was thrown into uncertainty in August when a US judge said the defunct Crystallex could go after the Citgo shares to collect on a $1.2 billion judgment related to Venezuela nationalizing its mine.  Venezuela has paid Crystallex $500 million of the total judgment, which has grown to $1.4 billion with interest. A January 10 deadline looms for the next payment.

7.  The Briefs (selections from the press – date of article in Peak Oil News is in parentheses – see more here: news.peak-oil.org)

In Germany, Volkswagen has been testing the newly developed R33 BlueDiesel fuel blend at its in-house filling station in Wolfsburg since January. The fuel, jointly developed by Volkswagen, the Coburg University and other project partners, contains up to 33 percent renewable components based exclusively on residual and waste materials and enables CO 2 savings of at least 20 percent compared to conventional diesel. (12/1)

North Korea: Reviews of confidential U.N. documents and interviews with US officials uncovered dozens of ships and companies that international authorities link to illegal North Korean trade. The behavior of the vessels and changes in their ownership reveal an expanding toolbox of strategies designed to keep North Korea’s shipping, and economy, afloat. (11/28)

The Zimbabwean oil crisis, largely caused by poor government planning, has reached an all-time low, which has resulted in the dwindling fuel supplies reaching a critical point of a crisis. The country now has less than a week of fuel left, this after a long strenuous week for consumers, who have stood in long winding lines nationwide. (12/1)

Brazil’s Petrobras said Wednesday it has sold onshore and shallow offshore fields in Brazil for $823 million, part of the company’s efforts to divest assets to focus on deepwater. (11/29)

In Brazil, President-elect Jair Bolsonaro wants to open more of the pre-salt assets—an area currently exclusively in the hands of state oil firm Petrobras—to private investors, hoping to earn US$31 billion that could help narrow Brazil’s massive budget deficit. (11/27)

In Argentina, Mexico-based Vista Oil & Gas plans to invest $157.4 million in its first pilot projects in Vaca Muerta, betting on the Argentinian shale play for oil and natural gas production growth. (11/27)

Mexican discovery: Pemex is set to add a billion barrels of oil equivalent to reserves after discovering a gas field that, within four years, will yield 80,000 b/d of condensates and 700 million cubic feet per day of gas to feed petrochemical units in southern Mexico. The company claims the discovery in the Ixachi field, state of Veracruz, is the most important made in the inland portion in the last 25 years and the fourth biggest at a worldwide level in the last decade. (11/29)

Alberta’s blues: Under pressure from falling WCS prices that are now around $15 per barrel and zero spare takeaway capacity to ship oil to its largest purchaser, the United States, Alberta revised downward its economic growth forecasts for 2019 from 2.5 percent to 2.0 percent. (12/1)

The Government of Alberta has been forced into buying more oil trains to move crude from the province, the Calgary Sun reports, quoting Premier Rachel Notley as describing the situation with Alberta’s oil as “fiscal and economic insanity.” The trains will have a total capacity of 120,000 b/d and will cost Alberta $263.77 million.  The trains should reach their full capacity late next year and help reduce the discount of Western Canadian Select to West Texas Intermediate by about $3 per barrel. That’s not a lot given the current discount between WCS and WTI is more than $40 a barrel. (11/30)

The US oil rig count increased by two to 887, according to Baker Hughes.  For the month, the rig count was up 12 in November, matching last month and its fifth monthly increase in a row. The gas rig count fell by five to 189.  The total number of active oil and gas drilling rigs now stands at 1,076 according to the report, which is now up 147 from this time last year. Of that total, 138 of the gross increase is in oil rigs. (12/1)

US crude oil and natural gas proved reserves rose to record highs in 2017, driven by stronger energy prices and the continuing development of shale formations, the US EIA said on Thursday. Crude reserves increased 6.4 billion barrels, or 19.5 percent, to 39.2 billion barrels at year-end 2017, marginally higher than the previous record of 39 billion barrels set in 1970. Natural gas reserves jumped 123.2 trillion cubic feet (tcf), or 36.1 percent, to 464.3 tcf last year. (11/30)

US is world’s sweet spot? The US holds nine out of the top 10 global locations for investment in the upstream oil and gas sector in 2018, according to a wide-sweeping survey released Thursday by Canada’s Fraser Institute. In last year’s survey, the US represented six of the top 10 spots.  The ranking is based on the policy perception index, which is created by compiling respondents’ answers to the various potential barriers to investment facing each region. The highest score a region can score is 100, which was only achieved by Texas this year, followed closely by Oklahoma. For the first time in five years no Canadian province made the top 10; the top two producing provinces in the nation, Alberta and British Columbia, ranked 43rd and 58th, respectively, of regions to invest out of 80 worldwide locations. (12/1)

TX infrastructure boom: Proposals on the table would be part of a historic buildout of oil and gas infrastructure in the US as it becomes a top exporter of both fuels. Texas, home to the most prolific oilfield in the country, is at the epicenter of the frenzy. More than 80 plants, terminals, and other projects are in the works or planned up and down the state’s Gulf Coast, from Port Arthur to Brownsville, according to a Center for Public Integrity and Texas Tribune review of corporate plans. (12/1)

Permian pipeline: Jupiter Energy Group has launched its 90-day open season for binding shipper commitments on the Jupiter Pipeline. The company says the 650-mile-long Jupiter Pipeline will be the only pipeline out of the Permian Basin that will access all three of Texas’ deepwater ports – Houston, Corpus Christi, and Brownsville. The 36-inch pipeline, which could begin service in the fourth quarter of 2020, could boast a capacity of up to 1 million barrels per day of crude oil. (12/1)

In Texas, the Corpus Christi Ship Channel Improvement Project will cost an estimated $360 million. Nearly one-half of the $360 million needed to widen and deepen the Corpus Christi Ship Channel to accommodate greater energy export volumes from Texas’ Coastal Bend region has been secured. (11/27)

Quake; pipeline shut down:  A magnitude 7 earthquake struck Alaska early Friday, shutting the state’s most important oil pipeline. The temblor struck 8 miles north of Anchorage. The 800-mile Trans Alaska pipeline that carries crude from the Arctic coast to the marine terminal in Valdez was shut as a precaution. Operators were not aware of any damage to the line, which transported 530,000 barrels on Thursday. (12/1)

Keystone continuance: TransCanada Corp.’s long-delayed Keystone XL oil pipeline will face another round of environmental scrutiny, all but dashing company plans to begin construction in February. In a filing on Friday, the US State Department indicated it’s going to undertake a new review of the $8 billion project. The analysis, formally known as a supplemental environmental impact statement, will look at potential effects on greenhouse gas emissions, crude spills, cultural resources, and the overall market. (12/1)

Seismic off east coast: The Trump administration is taking a major step toward allowing a first-in-a-generation seismic search for oil and gas under Atlantic waters, despite protests that the geological tests involve loud air gun blasts that will harm whales, dolphins and other animals. (12/1)

More storage for Louisiana: The Plaquemines Liquids Terminal would open up to 20 million barrels of storage for both crude oil and refined products and export facilities capable of loading Suezmax and VLCC vessels. Tallgrass Energy, LP reported Tuesday that it had acquired a 600-plus-acre site to build its planned terminal along the Mississippi River south of New Orleans. (11/28)

Biofuels waivers: The Trump administration has decided to keep waiving some oil refineries from US biofuel mandates, despite pressure from ethanol advocates to end the practice. (11/30)

Corn fuel tiff: The EPA has rejected requests from the corn lobby to reallocate biofuel volumes waived under its small refinery exemption program into its 2019 mandate, an agency official told Reuters on Tuesday. The powerful corn lobby has complained for months that an expansion of the EPA’s refinery waiver program under the Trump administration threatens demand for crucial farm products like corn-based ethanol. (11/28)

EPA on biofuels: The EPA on Friday increased by 15% its annual blending mandate for advanced biofuels, drawing praise from the US biofuels industry, but disappointment that the government had not done more to protect the agricultural market. Under the US Renewable Fuel Standard, oil refiners must blend increasing amounts of biofuels into their fuel each year or purchase blending credits from those that do. The volume for conventional biofuels like corn-based ethanol was not increased. (12/1)

Shell on EVs: Oil supermajor Shell sees electric vehicle (EV) enthusiasts buying into the ‘cool factor’ of zero-emission vehicles, driving EV fleet growth regardless of the oil price fluctuations. Shell noted that EV enthusiasts are emphasizing the social desirability of zero-emission fun-driving-experience cars—a factor important enough to ignore the fact that EVs are currently more expensive than vehicles with internal combustion engines. (11/28)

Battery electric cars emit fewer greenhouse gases and air pollutants over their entire life cycle than petrol and diesel cars, according to a European Environment Agency (EEA) report. (11/26)

H2 for CA:  France-based Air Liquide, a 65,000-employee company that sells gases to industrial and medical customers worldwide, will build for $150 million the “first world-scale liquid hydrogen” plant in the US to help efforts to replace gasoline with a cleaner fuel. The plant, to be built in the west, will have enough capacity to power “35,000 fuel cell electric vehicles.” Construction will begin in early 2019. (11/27)

In Bulgaria, more than 1,000 people urged the government to guarantee it would not shut mines and power plants at Maritsa East lignite coal complex in southern Bulgaria, despite a European Union push to decarbonize the bloc’s economy by 2050. (11/30)

Air pollution and cancer: A team at the University of Stirling in the UK has found new evidence of the link between air pollution and cancer as part of a new occupational health study. The team analyzed the case of clusters of women working as border guards at the busiest commercial border crossings in North America. (11/30)

Brazil this week pulled out of hosting next year’s United Nations global summit on climate change, the latest signal that Latin America’s largest nation no longer aspires to be an influential player in efforts to mitigate the effects of a warming planet. The decision comes about a month before the inauguration of president-elect Jair Bolsonaro, who has vowed to empower commercial ventures in the Amazon and other Brazilian biomes while weakening enforcement of environmental laws. (11/29)

EU climate progress slowing: Progress on increasing the use of renewable energy and improving energy efficiency is slowing across the European Union, putting at risk the EU’s ability to achieve its energy and emissions reduction targets. Rising energy consumption, particularly in the transport sector, is to blame for the slowdown, according to preliminary data released in the European Environment Agency’s (EEA) annual analysis on the EU’s progress towards its targets on renewables and energy efficiency.

Cutting carbon emissions to zero in line with the Paris climate accord could require up to €290bn a year in additional investment in Europe, the EU will say as it prepares the ground for a bruising battle at next week’s UN climate talks. (11/28)

Palm oil was supposed to save the planet; instead, it has unleashed a catastrophe.  Indonesia’s biggest export, palm oil—used increasingly in biodiesel—has twice the carbon emissions as conventional diesel fuel, according to some expanded life-cycle analyses.  The tropical rainforests of Indonesia have large amounts of carbon trapped within their trees and soil. Slashing and burning the existing forests to make way for oil-palm cultivation had a perverse effect: It released more carbon, a lot more carbon. The accelerated destruction of Borneo’s forests contributed to the largest single-year global increase in carbon emissions in two millenniums, an explosion that transformed Indonesia into the world’s fourth-largest source of such emissions. Researchers at Columbia and Harvard later estimated that the fires led to 100,000 premature deaths.

The American biofuels mandate of 2007 is what got Indonesian palm off the ground.  The resulting unprecedented palm-oil boom, meanwhile, has enriched and emboldened many of the region’s largest corporations, which have begun using their newfound power and wealth to suppress critics, abuse workers and acquire more land to produce oil. Global Witness has counted at least eight assassinations of Indonesian environmentalists fighting palm oil. (11/26)