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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: Salt'n'Peppa who wrote (97391)	2/28/2008 11:21:07 AM
From: elmatador	Read Replies (1) \| Respond to of 206110

Britain could have had one of the world's biggest sovereign wealth funds had the windfall from North Sea oil been saved rather than used to cut taxes and boost spending, according to a report out today. UK 'missed chance to build up £450bn sovereign wealth fund' Larry Elliott, economics editor guardian.co.uk, Wednesday February 27 2008 Britain could have had one of the world's biggest sovereign wealth funds had the windfall from North Sea oil been saved rather than used to cut taxes and boost spending, according to a report out today. A study from PricewaterhouseCoopers found that the UK could have built up a nest egg of £450bn - bigger than those of Kuwait, Russia and Qatar combined - had it put tax receipts from oil and gas fields into a long-term fund. Instead, the report said, successive governments used the proceeds from oil and gas fields to keep public borrowing down rather than build up a fighting fund to tackle long-term problems such as the ageing of the population. Norway has used its North Sea revenues to build up a sovereign wealth fund, while Middle Eastern states have recently used their funds to take stakes in banks that have run into trouble as a result of the global credit crunch. John Hawksworth, PWC's chief economist, said that even had the UK saved only half its North Sea receipts it would have a fund bigger than that of Kuwait (£213bn) and not far behind Norway's £322bn fund. It would, however, still only been worth just over half Abu Dhabi's £875bn fund. Hawksworth added that oil money allowed taxes to be kept lower than would have been possible without either rising national debt or sharp cuts in public spending as a share of the economy. "Since oil revenues were greatest in the first half of the 1980s, this was also when this potential effect was greatest. In practice, had the oil revenues not been there, it seems most likely that some combination of higher taxes and lower current spending would have taken the strain, although we can never know for sure." Even though oil prices have risen fivefold to $100 a barrel since 2003, Mr Hawksworth said it was "a bit late" for today's politicians to start building up a fund to pay for the retirement of the baby boomer generation. Oil revenues rose from almost nothing in the mid-1970s to be worth over 3% of GDP (about £45bn in current money) at their peak in 1984-5. They are now worth around 0.5% of GDP. "To a significant degree, the money has effectively been handed back to this and other generations since the early 1980s to spend or, in many cases, to invest in housing or other assets." Hawksworth said that a UK sovereign wealth fund might have been useful in encouraging long-term investment and fairness across the generations. "Without such a fund, it is hard to dispel the suspicion that, in 30 or 40 years time, many of us may be sitting around looking enviously at the Norwegians and others and wondering: where did our oil money go?"

To: Salt'n'Peppa who wrote (97391)	2/29/2008 2:46:55 AM
From: energyplay	Read Replies (1) \| Respond to of 206110

Thanks. Is the Bakken in North Dakota / Montanna ? I understand that is pretty spotty, so there is exploration risk. The shale formations tend to be large blankets with low risk - drill 10 holes, get 9 reasonably producing wells. If the BC Shale is near the existing gas infrastructure, that would be good. That might bail out western Canada and the oil sands producers. Otherwise, it might be like Mackenzie river - wait for the next generation. >>Could you post some more on the Montney Shale ?<< Barnett shale runs just west of Dallas, and there is extensive energy infrastructure nearby the shale - right on the surface ;-) There was also the play that UPL explored - I forgot the name. I don't see anything to get us off the depletion tread mill, but there is enough new gas to avoid near term panic. Of course, that means our politicians and "leaders" will do little about natural gas. The last leader who did much about energy was Gerald Ford.