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Politics : Rat's Nest - Chronicles of Collapse -- Ignore unavailable to you. Want to Upgrade?

To: Wharf Rat who wrote (6472)	9/25/2007 6:29:38 AM
From: Wharf Rat	Respond to of 24235

Analysts watch, wince as Mexico's oil supply dwindles They warn of an irreversible output decline. By DAVID ADAMS, Times Latin America Correspondent Published September 24, 2007 MIAMI - When left-wing guerrillas in Mexico bombed several pipelines in simultaneous attacks this month, it sent a shudder through that country's large oil and gas industry. The threat of economic sabotage by a shady group known as the Revolutionary Popular Army EPR poses a major new headache for the Mexican government. But Mexico's energy industry problems run far deeper than terrorist attacks on its infrastructure, analysts say, and have major implications for U.S. oil supply. "Mexico's oil production is in decline. There's probably no way to stop it," said Mike Rodgers, an expert at one of the top oil industry consulting firms, PFC Energy in Houston. Mexico is the second largest supplier of oil to the United States (about 1.5-million barrels a day). But output from its major fields is dwindling fast, according to official figures from the state-owned oil giant Petroleos Mexicanos (Pemex). The country's known oil reserves will run out in nine years, the government says, potentially undermining the nation's oil-dependent budget. Mexico's decline only adds more pressure to prices in a tight global oil market, which hit $83 a barrel Thursday. Worse still, its emptying wells are only a reflection of a global decline in aging oil fields around the world. With no major oil fields left to discover, analysts say the world is approaching "peak oil," the moment at which oil production hits its maximum capacity and slowly starts to fall. Mexican output peaked at just over 3.4-million barrels a day in 2004. "I don't believe we'll ever see it that high again, no matter how much is invested," said David Shields, an oil industry consultant in Mexico City. Daily output at Mexico's biggest oil field, Cantarell, highlights the problem. Production there dropped by a staggering half a million barrels in the last 18 months, to 1.5-million barrels from 2-million. Once the world's second-biggest oil field, it is expected to continue losing production, down to as little as 600,000 barrels a day by 2013. In Mexico, geology and politics go hand in hand. The oil industry was nationalized in 1938. State control of oil and gas is protected under Mexico's constitution, which strictly limits foreign investment in the extraction of the nation's energy resources. The Cantarell field, which lies offshore in the Gulf of Mexico, takes its name from a Mexican fisherman named Rudesindo Cantarell who discovered it accidentally in the 1960s after noticing his nets were coming up smeared in tar. It turned out to be a dream find. Unlike most fields which are spread out over a large area, Cantarell is highly concentrated, spanning only 70 square miles of ocean floor. As a result, Cantarell's 200 wells do a job that would normally require thousands more drillings. Geologists attribute this possibly to an asteroid that hit the Yucatan peninsula some 65-million years ago. Its impact may have caused subterranean cracks that allowed oil to run into a vast underground chasm. The same asteroid is believed to have led to the extinction of the dinosaurs. But instead of reinvesting profits in new wells to sustain production once Cantarell runs out, Mexican governments used the oil revenue to pad their budgets. Taxes and dividends from Pemex's production last year amounted to $52-billion, 40 percent of government revenue. Pemex's lack of access to foreign financing and technology has left it hamstrung as it looks around for new fields. Pemex has said it can offset declines at Cantarell with new production from other fields. While several sites, onshore and offshore, have potential, it would take a decade of massive investment to bring them on stream, analysts say. "They really don't have a way to fix the problem," says Rodgers. "They could have if they had used some foresight. Now it's virtually impossible." In his recent state of the union speech, Mexican President Felipe Calderon mentioned the nation's dwindling reserves. "Our petroleum reserves have been reducing constantly. It has to be said," he said, as if broaching a taboo subject. Rather than proposing ways to increase production, Calderon seemed to accept there was no way for Mexico to drill its way out of the problem. Instead, he called for "an urgent reduction in public spending to reduce the enormous dependence on oil revenue." The fact that Mexico may be running out of oil should not alarm U.S. consumers in the short term, analysts say. The United States will most likely buy more from Canada, which is the nation's number one supplier. New technology and high prices are helping tap vast new sources of so-called unconventional crude oil, such as Canada's tar sands. Global oil production (currently 85-million barrels a day) could reach as high as 100-million barrels per day in the next few years, analysts say. But that may not be enough to keep pace with demand from growing economies such as China and India. In the long term, Mexico's problems are likely to be everyone's. David Adams can be reached at dadams@sptimes.com. sptimes.com

To: Wharf Rat who wrote (6472)	9/25/2007 12:01:16 PM
From: Skywatcher	Read Replies (1) \| Respond to of 24235

Sun-powered homes defy a cool housing market Builders say buyers are seeking them out, and solar industry officials say growth is going through the roof. By Elizabeth Douglass Los Angeles Times Staff Writer September 25, 2007 With foreclosures rising and home prices diving, there is a bright spot in California's residential real estate market: Solar-powered homes are starting to outsell traditionally electrified new homes in several markets, and developers are stepping up their use of the technology. Perhaps it's only fitting for a state that so openly celebrates its sunshine. Still, the growing popularity of household solar power is an encouraging sign for the thousands of solar enthusiasts and vendors gathering in Long Beach this week. "Those builders are seeing that they'll get more buyers coming to their developments when they have solar. They sell like hot cakes," said Bernadette del Chiaro, energy specialist at the advocacy group Environment California. Julie Blumden, a vice president at SunPower Corp., a San Jose-based manufacturer of solar roof tiles, said builders using solar were selling homes faster than nonsolar competitors -- an important factor in a slow market. "The increase in sales velocity is actually paying for the solar systems," she said. SunPower, which sells its solar tiles to builders including Lennar Homes and Grupe Co., said it had orders to provide solar systems for 3,000 new homes in California in the coming years. "The last time we saw interest in solar that was anything close to this was back in the 1980s, the first time there were federal tax credits for solar energy," said Julia Judd Hamm, executive director of the Solar Electric Power Assn. and co-chair of the Solar Power 2007 conference underway at the Long Beach Convention Center. "But the numbers then aren't even comparable to what we're seeing now." Solar power is hotter than ever, helped by California's ambitious Million Solar Roofs rebate program, federal tax credits and growing public and political support for renewable power of all kinds. The U.S. solar industry saw record growth last year, with California the largest market by far, according to a study by the Prometheus Institute for Sustainable Development. And 2007 is shaping up to be another big year, industry officials say. The boom also has swelled the community of solar products and pitchmen. Both will be on display at the solar conference and expo, which is expected to draw more than 11,000 attendees in Long Beach, up from 8,500 at last year's event in San Jose, organizers say. Tonight, the show is free to the public from 5:30 p.m. to 8:30 p.m. Exhibitors will be hawking photovoltaic solar panels in all forms, with some companies showing off systems that embed the technology in carports, roofing tiles and other structures. Some will be targeting individual homeowners, while others will be angling for business with utilities that want to boost their use of renewable power. California's largest electric utilities, including Edison International's Southern California Edison Co., PG&E Corp.'s Pacific Gas & Electric Co. and Sempra Energy's San Diego Gas & Electric Co., have signed deals to build power-plant-sized solar facilities in and around the Mojave Desert or negotiated contracts with companies putting up such plants. "Obviously, there are a nearly unlimited number of rooftops available in California and across the country" for individual solar power production, Hamm said. "At the same time, the whole concept of utility-scale plants is really just starting to gain momentum. So it's going to be a combination of the two." California's $3.3-billion Million Solar Roofs program is based on the notion that businesses and homeowners would install solar systems faster if the cost was partially offset by rebates and incentives. The goal is to create 3,000 megawatts of new solar power in California by 2017 and to build solar power systems into half of all new homes by 2015. "We were at 1% in 2004, and we're probably only at about 5% of all new homes right now," said Del Chiaro of Environment California. "It's good growth, but we're going to have to ramp up quite significantly to get to that 50% mark." The solar power industry is drawing its share of star power. Cable television mogul Ted Turner, who will deliver one of the keynote speeches launching the show today, teamed up this year with New Jersey solar developer Dome-Tech Solar to form a venture called DT Solar. Turner, chairman of Turner Enterprises Inc., said the renamed solar company would continue its focus on designing and installing large-scale projects and was expanding into California and other U.S. markets. "Clean alternative energy is going to be a huge market because it's going to be done all over the world and it's got to be done right away. We're out of time," Turner said. "Solar has probably the most potential because the sun is everywhere." Hamm and others are encouraged by the explosion of start-up companies and new products in the solar industry, as well as by the technology's growing popularity with the public. But she knows solar is still a small fry in the electricity world. "I don't think anybody in the solar industry thinks that solar is the answer and is eventually going to take over," she said. "Right now, solar electricity is about one-tenth to two-tenths of a percent of the entire U.S. energy mix. It's barely even a dot on the radar screen."