Republican Senator Calls John Linder’s False Claim about Chinese Oil Drilling Off Cuba “Urban Legend”

What do Vice President Dick Cheney and U.S. Representative John Linder (R – Georgia) have in common?

They’re both making the same false claim that China is drilling for oil off the coast of Florida in Cuban waters.

Vice President Dick Cheney, in a speech last Wednesday to the U.S. Chamber of Commerce quoted a column by George Will, who wrote last week that “drilling is under way 60 miles off Florida. The drilling is being done by China, in cooperation with Cuba, which is drilling closer to South Florida than U.S. companies are.” [Source: Miami Herald, 6/12/2008]

Today, in an op-ed column featured in the Gwinnett Daily Post, Congressman John Linder repeated the Vice President’s claim:

Floridians oppose drilling 125 miles off shore for fear of a spill harming their beaches. However, China is drilling 50 miles from Key West on behalf of Cuba, which will then sell the oil to China. Why do we want them to have oil we could have?

Source: 6/17/2008 Gwinnett Daily Post op-ed “Increase oil supply and prices will drop”

Vice President Cheney’s office was forced to issue a correction after Cheney made this claim. Even Republican Senator Mel Martinez, former Chairman of the Republican National Committee, stated that “Any talk of using some fabricated Cuba-China connection as an argument to change U.S. policy has no merit.” He also said, “Reports to the contrary are simply false. They are akin to urban legends.” [Source: Miami Herald, 6/12/08]

Americans are paying an average of $4.08 for a gallon of gas and all they’re getting are lies and ‘urban legends’ from Republicans.

If Republican Members of Congress, like John Linder, can’t be trusted to tell the truth about where oil is being drilled, they certainly can’t be trusted to do anything meaningful to lower the price of gas. Americans struggling to afford to fill their gas tanks deserve better than fear mongering and lies about gas prices from Republicans.

54 comments

  1. Icarus says:

    “Americans are paying an average of $4.08 for a gallon of gas and all they’re getting are lies and ‘urban legends’ from Republicans. ”

    Second time today Andre, that I will ask this question. What, exactly, are we getting from Democrats, the MAJORITY party in Congress?

    I’ll give them credit for one thing, though. They sure delivered on that promise to get rid of $2.50/gallon gas.

  2. jsm says:

    “veto happy?” The laughs never do stop coming. How many vetoes is Bush up to now? Eight, I think? That’s just funny right there; I don’t care who you are.

  3. MSBassSinger says:

    Talk about misdirection plays. Go after a misstatement when the overall point is valid, in order to score political points.

    China and Cuba are off our shores, doing the prelimianry work to start drilling. I have heard fishing boat captains talk about increased incidences of Cuban gunboats in international waters threatening them, and Chinese were seen onboard.

    So, to use an analogy more common to our lives – if a thief is outside your house at 2AM, planning which window to come in, and how to disarm your security system, checking his 9MM to make sure the clip is full – that is OK? No need to be alarmed, I guess, until the thief is in the house holding you and your loved ones at gunpoint.

    The Cuban-Chinese drilling agreements are in place. The Chinese already have engineers surveying and planning the initial drilling sites, protected by Cuban gunboats in international waters. These are the same Chinese who have nuclear missles aimed at US soil (side note: thanks to the Clinton administration who authorized the sale of the American missile guidance technology that allows them to make accurate, long range missiles).

    So what, do we just ignore the valid point Cheney was making, and wait until the Chinese are drilling horizontally into American oil?

    I wonder why the Bush administration is not enforcing freedom of the seas with these Cuban gunboats. Bush, Martinez, McCain – all RINOs.

  4. SouthFultonGuy says:

    All the way back in 2004, China’s Petrochemical Corporation known as Sinopec signed a memorandum of understanding with Cuba’s national oil company, known as Cupet to explore four oil blocks in Cuba. Keep in mind that both of these companies are owned by their communist governments. China’s Sinopec conducted six months of geological studies of the four Cuban blocks. This was the first attempt by Sinopec, China’s second largest oil and gas company, to enter oil and gas exploration and production in Cuba.

    Then in 2005, China’s Sinopec signed an agreement with the Cuban government to jointly produce oil in Cuba off the coast of Pinar del Río. Ok so let’s get this straight. The governments of China and Cuba enter into a production sharing agreement … what exactly does that mean? This is when the Cuban government awards the execution of exploration and production activities to an international oil company like Sinopec. The contractor bears the mineral and financial risk of the initiative and, when successful, recovers capital expenditure and costs incurred in the year (cost oil) by means of a share of production.

    So now, for your reading pleasure (and Mel Martinez’s) is a timeline of China’s oil exploration efforts in Cuba. This is from the World Security Institute …

    2005

    January 31: Cuba and China signed a contract in Havana providing for the Asian giant’s participation in extracting oil from a deposit off the island’s north shore, the press reported. The deal is between Cubapetroleos and the Chinese oil company Sinopec, said the official daily newspapaer Granma. In December, Fidel Castro announced discovery of oil at a site offshore from Santa Cruz del Norte, some 55 kilometers (33 miles) east of Havana. The deposit is believed to hold some 100 million barrels of “light” crude, or the equivalent of 14 million tons. (EFE, Prensa Latina, 31/1/05)
    February 8: China’s oil giants began cultivating their virgin soil in Cuba. China Petroleum & Chemical Corporation (Sinopec), as the first comer, has inked a contract with Cuba Oil Company (Cubapetroleo) to jointly exploit oil in the Caribbean country. Under the terms of their contract, the two sides will join forces to prospect and exploit a potential oil-producing region. Chinese experts believe it is a significant beginning of the cooperation between China and Cuba in the petroleum industry. (SinoCast, 8/2/05)
    March 22: Chinese oil drilling equipment has begun arriving in Cuba as state-run Cubapetroleo (Cupet) and its foreign partners prepare to significantly increase drilling along the northwest coast, industry sources said. “Four service units and a small rig have arrived and we are waiting for more,” said a Cuban oil service manager, asking his name not be used. There are currently five rigs operating along the northwest heavy oil belt, an 80-mile (128-km) stretch of coast in Havana and Matanzas provinces from whence come all of Cuba’s 70,000 to 80,000 barrels per day of heavy crude at 8 API to 18 API and with a high sulfur content. The poor-quality oil is burned in modified power plants and factories. (Reuters, 22/3/05)

    April 6: The operator of China’s second-largest Shengli oilfield is stepping up overseas exploration, spending more on such ventures this year as the world’s No. 2 oil user grapples with falling reserves, officials said. Shengli Oilfield Administration Bureau, a unit of state-run Sinopec Group, will spend about $40 million drilling for oil and gas in Cuba, Iran and central Asia in 2005, company officials said. “This will be the heaviest spending in a year and we expect the pace to continue in the next few years,” a Shengli executive told the press. Shengli, which is among the first Chinese companies to venture abroad, will sink a total of eight wildcat and appraisal wells this year, four in Kazakhstan, two in Iran, and one each in Cuba and Kyrgyzstan. (Reuters, 6/4/05)

    November 24: PetroChina Great Wall Drilling Co., Ltd. and Petroleum Company of Cuba held a ceremony for signing two drilling service contracts on November 3, 2005. It is the second-time cooperation between Great Wall Drilling Co., Ltd. and Petroleum Company of Cuba after the signing of a one-year petroleum service agreement on one 1500HP drilling rig and one 2000HP rig on April 8 this year. The contract signed this time includes three 2000HP drilling rigs. The contract has a period of one year and a value of over US$24 million. The project will be launched in January 2006. (China Chemical Reporter, 24/11/05)

    December 22: Sinopec of China signed an agreement earlier this year to jointly produce heavy oil with Cupet in westernmost Pinar del Río province, with drilling expected to begin in 2006. (The Oil Daily, 27/12/05)

    Still not convinced Senator Martinez? Here are some more reports from 2005 from the Energy Intelligence Group and National Post’s Financial Post & FP Investing in Canada.

    … China is seeking oil everywhere and Cuba is no exception. Three large Chinese companies, SINOPEC, Petro China and CINOOC – China National Offshore Corporation, are involved in a large agreement, perhaps already underway, for coastal and deep-water explorations. Most significant to this topic, especially in light of other Chinese investment in Cuba, is the fact that Sinopec, China’s second largest oil company, has stated a goal of helping boost Cuba’s domestic oil production and producing 60% of its oil needs by 2006 … Additional plans for exploration and development of other blocs of potential reserves were announced by two other Chinese oil companies, China National Petroleum Corp. and China National Offshore Oil Corp., after talks with CUPET, Cuba Petroleum. Some exploration will be in coastal regions but much, based on the better quality of the oil, will take place in off-shore deep waters.

    Let’s cut to the chase … and pardon me if I scream here:

    The point isn’t that China is not presently drilling for oil within 90 miles of the U.S. The point is that they CAN! — and, thanks to the Democrat congress — we CAN’T.

    Democrats would like us to wrangle over what IS happening. The issue is what CAN happen. They can drill. We can’t. They’re planning to. We aren’t. Even government educated Democrat myrmidons can understand that.

    Boortz: http://boortz.com/nuze/200806/06132008.html

  5. John Konop says:

    FYI

    China, Cuba reported in Gulf oil partnership
    U.S. firms stand by, prohibited from bidding on contracts; lawmakers propose opening up U.S. coast for drilling.

    (CNNMoney.com) – Plans for foreign oil companies, some from India and China, to drill off the cost of Cuba are prompting calls from lawmakers to ease environmental restrictions that prohibit coastal drilling in most of the U.S., according to a report Tuesday.

    At a time of rising soaring gasoline prices caused partly by a lack of supply, legislators are fuming that Cuba is opening up its continental shelf for oil and gas exploration while most of the U.S. continental shelf outside the Gulf of Mexico, which extends 200 miles from shore, has been off limits for drilling since the early 1980s, the New York Times reported.

    Adding insult to injury, the Times said U.S. firms were invited to bid on the Cuban contracts, but were barred by the U.S. government due to the country’s longstanding economic embargo of communist Cuba.

    “Red China should not be left to drill for oil within spitting distance of our shores without competition from U.S. industries,” Sen. Larry Craig, Republican of Idaho, told the Times.

    Firms from Canada and Spain will also drill off the Cuban coast, the article said

    Craig is introducing a bill to exempt U.S. oil firms from the embargo, much as food and drug firms are, according to the article.

    There are also several bills moving through Congress aimed at opening up areas more areas of the U.S. to oil and gas exploration, including coastal waters and Alaska’s Arctic National Wildlife Refuge.

    Supporters of the bills, including the oil industry, say it would help bring down oil and gas prices and decrease the country’s reliance on oil imports from the volatile Middle East.

    Gasoline prices have soared 33 percent over the last year, while the price of crude oil has tripled since 2002.

    But critics of more drilling say the energy obtained, which they say would be minimal and wouldn’t bring down prices that much, isn’t worth the environmental risks. They also say more drilling for a finite resource does nothing to promote long term conservation solutions.

    Most coastal states also oppose offshore drilling, fearing unsightly rigs and oil spills will hurt their tourism industries.

    The United States Geological Survey estimates the Cuban deal involves 4.6 billion barrels of oil and 9.8 trillion cubic feet of natural gas, according to the Times. The paper said that’s enough oil and gas to power the U.S. for a few months.

    The paper also cited an Interior Department study that said the U.S. continental shelf contained 115 billion barrels of oil and 633 trillion cubic feet of natural gas. That would be enough oil to satisfy U.S. demand, at current consumption levels, for 16 years and enough natural gas for 25 years, according to the Times.

    http://money.cnn.com/2006/05/09/news/economy/oil_cuba/index.htm

  6. Icarus says:

    Andre? Two threads later and still open questions? Care to comment? Or is it just enough to post about “lies and ‘urban legends’ from Republicans” so that you can sleep tonight knowing you’re still a Democrat?

  7. bowersville says:

    Paul Broun, introduce a bill calling for drilling, refining and domestic exploration in the House and see if you can drag the rest of the G-7 along.

  8. Icarus says:

    …but please make sure to ban Playboy magazine on the drilling rigs. We don’t need these oil drilling patriots distracted.

  9. bowersville says:

    Maybe those patriots are distracted by playboy and failing to recognize the need to be drilling in the right places? Hmm

  10. Ms_midtown says:

    Konop, South Fulton, julio, and others
    Thanks for the posts with more details.

    I’ve heard that Alaska oil does not even necessarily end up in America

  11. LoyaltyIsMyHonor says:

    Just something to remember. I’m a Republican (actually a Conservative…there’s a difference, really there is..but anyway…), I own shares in a company that drills in areas of Alaska that are not “offlimits.” Expanding drilling will hurt my bottom line…This is true for a lot of share-holders, Republican and Deomocrat. Don’t believe for a second that this is a D v. R. conflict…It’s a Black v. Red issue. I’m opposed to expanded drilling..

    I drive a Civic, I make more money everyday in dividends than I spend in Gasoline…Gasoline could go up to $10 a gallon, and I’ll still make money 😉

    Sell or trade in your SUV….if you still can…suckahs!!!!!

  12. bowersville says:

    Playboy and alternative fuels are not an option, there is no substitute for drilling now and drilling often in productive locations.

  13. bowersville says:

    “I drive a Civic, I make more everyday in dividends than I spend on gasoline..”

    I hate to break it to you, but that ain’t saying much.

  14. MSBassSinger says:

    “alternative fuels are not an option”
    Well, actually…

    In most cases that is true. Hydrogen, solar, and wind are never going to meet the need.

    However, Bell Bio-Energy in Tifton has perfected the process to convert biowaste (not foodstuffs like corn) into oil for gasoline and diesle that is cleaner and cheaper than the current products, and using less energy to make it than the end products deliver. It is a low tech way to make gas and diesel and other oil products now.

  15. John Konop says:

    This article does a good job explaining the politics behind off-shore drilling.

    McCain plays with fire on offshore drilling

    Politico-By calling for an end to the federal ban on offshore oil drilling, John McCain is placing a risky bet. He is wagering that skyrocketing gas prices have finally reached a tipping point, a threshold moment that has led voters to rethink their strong and long-held opinions against coastal oil exploration.

    The stakes couldn’t be higher: If he is wrong, McCain will have seriously damaged his chances in two key states with thousands of miles of coastline — California and Florida — and where opposition to offshore oil drilling has been unwavering. And he will have undermined some of his closest political allies in those states and others, including potential fall battlegrounds such as Virginia and North Carolina.

    “Before $4.25-per-gallon gas, this would have been like pulling a pin on a grenade and rolling it into the state,” said David Johnson, the former executive director of the Florida Republican Party. “It would have been a fool’s errand to recommend it. It was never, ever a thing that a smart politician would have done in Florida.”

    In California, the drilling issue is just as volatile, said Sal Russo, a veteran Sacramento, Calif.-based Republican consultant.

    “California got really sensitive about these issues since the 1969 Santa Barbara oil spill. And I don’t think it’s changed much since then,” he said. “There are strong feelings on the issue.”

    read more

    http://controlcongress.com/uncategorized/mccain-plays-with-fire-on-offshore-drilling

  16. juliobarrios says:

    I don’t think McCain has a realistic chance of winning CA, but I agree it’s a risk on the FL front.

  17. Progressive Dem says:

    Republicans are desparately trying to make an issue over drilling. The fact remains there are 68 million acres of federal land that have been leased by oil and gas companies, and no drilling is taking place. If the oil companies were serious about finding new sources they would start drilling on these sites.

  18. heroV says:

    “I drive a Civic, I make more everyday in dividends than I spend on gasoline..”

    At current prices, I spend around $4 per day on gasoline. Congratulations…

  19. MSBassSinger says:

    Progressive Dem, are you sure those lands have enough recoverable oil? Besides, after 5 years of the oil companies paying the government money, if they don’t use the land for oil drilling, the land goes back to the government.

    Oil companies competitively bid on the 5 year leases, hoping there may be enough oil to make it profitable. When they find out there isn’t, there is no reason to drill.

    If you are buying into the false image that there are 58 million acres of oil rich lands just waiting to be drilled, you are believing a myth.

    ANWR and the Gulf Coast and California offshore seabeds do have billions of barrels of recoverable oil. Just as there are about 12-13 billion barrels of oil economically recoverable from biowaste in the US.

  20. MSBassSinger says:

    “Which will last us another 100 years. 150 on the outside. Then what?”
    And how has technology changed the last 100 years?

    Besides, oil is renewable via the biowaste conversion.

  21. griftdrift says:

    Somehow I knew you were going to say that. You’re playing a little fast and loose with the semantics. Fossil fuel is non-renewable. I would love to see biowaste used. But that’s a helluva lot different from drilling.

  22. MSBassSinger says:

    It is not fast and loose with semantics. Words mean things.

    No one cares where oil comes from. Whether it is fossil fuel from the ground, or processed biowaste – the end result is the same. Oil and oil products.

    It makes no sense to not drill where we can now, especially when the Chinese are already going after it. But long term, the use of biowaste for oil is a great solution. The technology is here now, it is less costly than fossil fuels, and generates the same fuels we use now.

    Doing both makes sense. Not drilling makes no sense.

  23. Doug Deal says:

    grift,

    We pretty well have all the energy we need in nuclear, but something has to bridge the gap until that reality recovers from the 30 year hiatus imposed by fear mongers.

    Ramping up nuclear, then converting coal to gasoline and using spare off-hour nuclear production to produce hydrogen to burn during peak periods, and we will have 200 years of energy needs satisfied.

    Nuclear will last forever, organics are limited. We need to use organics where they are needed most, high energy density mobile applications, not stationary electric power generators. Once fossil organics are gone, 200 years or so from now, we will need something to replace them.

    The failure to fully utilize nuclear power will end societal advance if it continues much longer.

  24. griftdrift says:

    I don’t really have a problem with nuclear either. Or drilling for that matter. But with drilling you have to recognize the potential for environmental impact and the fact it is not a long term solution. Its not even a sure bet to reduce current prices.

    I have a big problem with both sides backing into a corner like cats, rolling out their pet myths and refusing to do anything constructive.

  25. Icarus says:

    “I have a big problem with both sides backing into a corner like cats, rolling out their pet myths and refusing to do anything constructive.”

    As do I, and thus yesterday’s discussion of what some of us Republican grass roots types are willing to change and ask our leaders to do the same.

    Yet from Andre, all we’re getting back are plattitudes and dem talking points.

    I’ll go back to one of my points from yesterday, and ask it of the dems here:

    Would you be willing to allow offshore and ANWAR drilling if $1 for each barrel extracted from these areas was contributed to an environmental mitigation fund?

  26. MSBassSinger says:

    For those who think the oil companies are the big profiteers from high oil and gas prices…

    For your $4.029 gallon of gas…
    Federal Gas Tax – $0.184 = 4.57%
    Georgia Gas Tax – $0.075 = 1.86%
    Georgia Gas Sales tax (4%) – $0.161 = 4.00%
    Profit to the oil company – $0.040 = 0.99%
    Profit to the gas station – $0.019 = 0.47%
    Crude Oil Cost – $3.040 = 75.45%
    Refining Costs – $0.510 = 12.66%

    So, the Federal government makes 4.57% profit, almost 5 times what the oil companies make, and almost 10 times what the gas station owner makes.

    The Georgia state government makes 5.86% profit, more than 5 times what the oil companies make, and more than 11 times what the gas station owner makes.

    Yet, government does nothing to add value to the gasoline that you buy.

    Perhaps it is the Federal and State governments that should have a windfall profits tax levied on them.

    Oil companies make less than many other companies. The profit margin for the biggest oil companies was 7.6%. The rest of American companies, not including the car companies that lose money, is 9.2 percent. For example, Ben & Jerry’s, before they were bought by Unilever, regularly made 25%-32% profit. I don’t
    recall a move to have a windfall profits tax on “big ice cream”.

    The last time a windfall profits tax was levied on oil companies was during the Carter administration (1980). The result was an increase on foriegn oil imports and an increase in gas prices.

    If Clinton had not vetoed the bill allowing safe drilling in ANWR 14 years ago, we would have that supply of oil today. There are 30 years worth of Saudi oil imports available in ANWR.

    Gas prices will go down when supply increases. US Demand is only up a couple of percent in the last 2 years. So who stands in the way of more supply? Not the oil companies and refiners – they want to increase supply. It is the
    environemntal lobby groups and liberal Republicans (like McCain) and Democrats
    (like Obama). As a group over the years, these environmentalists and the politicians they support have prevented any new refineries from being built for 39 years. Refineries are, in total in the US, operating at 97% capacity.

    As maddening as $4 a gallon gas is, the only answer is an increase in supply so that the speculators in the futures market will see the current bubble burst and prices return to normal.

  27. griftdrift says:

    “Would you be willing to allow offshore and ANWAR drilling if $1 for each barrel extracted from these areas was contributed to an environmental mitigation fund?”

    Maybe. But here’s the problem with that. There’s no way to mitigate the destruction of a unique biosphere. Which is why I’m less opposed to offshore drilling in Florida than ANWR. Which is also why I’ll never be elected in the state I where I spend a third of my time.

  28. John Konop says:

    My only question is why do you think if companies like Exxon drill for oil the price will go down?

    From my understanding they only uncap their reserves when the price goes way up. And when the price goes down they cap it again. Do not get me wrong this is maximizing profits and is what they are paid for, yet it has little to do with price savings to consumers.

    The biggest way to drop prices is alternative competition to oil ie nuclear, wind, electric…….

  29. MSBassSinger says:

    “Except build the roads where it is used.”

    Roads don’t add value to the gas/oil/diesel products. Roads add value to the use of vehicles.

    Roads can be funded through a number of other means, and were before fuel taxes were tapped as the source.

    So the statement stands correct – “government does nothing to add value to the gasoline that you buy.” The various governments that levy the taxes didn’t put up the capital (at risk for loss) or labor for exploring and drilling, for refining and transportation. They didn’t offer the land for free (they get handsome fees for leases of government land). They didn’t refine it, and they didn’t sell it. They don’t pay dividends to the retirement funds of teachers, fire fighters, police, housewives, and other middle class folks like the oil companies do.

  30. Icarus says:

    I stated yesterday that my overall goal with a comprehensive energy plan wouldn’t be to lower prices, per se, but to move toward energy indepence, which I believe is one of the most pressing issues facing us today.

    That said, increasing domestic supply, especially if coupled with measures like an imported oil tax and/or a per gallon gas tax, would indicate to consumers that they must shift to more energy efficient habits, and would indicate to the rest of the world (India, China) that they need not be globe trotting trying to secure all available oil reserves.

    This should help both the market price from a supply/demand perspective, as well as scare the heck out of the speculators in the market.

    In fact, you could have enough speculators reverse course and short the market that there could be an over correction on the down side, as happened in the early eighties.

    If we could adapt some sane monetary/fiscal policies in the mean time, we could end this.

  31. griftdrift says:

    I just think its disingenous to imply government does nothing with the taxes they receive when they do build the roads. Sure it can come from other revenue sources but that’s not really the point is it?

    Me no like memes. And this is not the first time I’ve heard that argument

  32. BubbaRich says:

    Doug, you’re completely wrong. Nuclear won’t last forever. In fact, we only have a few decades of known uranium at CURRENT levels of use. Fusion would be a better long-term source, but it doesn’t exist. Our best bet is to use the local fusion reactor (the sun) to get useful energy, since we know it already gives the earth 10,000 times more energy than our current energy needs. Of course, much of that energy is used in other things, like photosynthesis and meteorology, so we don’t really have access to THAT much excess energy. We just need to find a clean way to convert the energy efficiently into useful forms.

    I’m all in favor of nuke reactors, and improving technology so that we don’t waste most of the energy content of the uranium and store radioactive waste for eternity. That’s just not a final answer.

  33. Icarus says:

    I have no problem with motor fuel taxes. The government has to raise revenue somewhere, and it’s as close as you get to a user fee for roads.

    I do have a problem when, like in GA, part or all of the tax is diverted to the “general fund”.

    I also have a problem, much like MsBassSinger, when hypocritical pols like to scape goat “obscene” profits of industries when they use those industries to generate large pots of tax money that they are addicted to appropriating.

    (See: Cigarette taxes)

  34. Doug Deal says:

    Bubba,

    Do some research. There are only decades of nuclear fuel left if you just look at what is already in exploited mines in easy to extract form at a very low price point. This is what anti-nuclear extremist and only anti-nuclear extremists use as a reason to not pursue nuclear power.

    There is more power in the residual uranium in coal than there is in coal. U-238, which makes up 99 percent of the natural uranium and cannot be used for fuel, can easily be turned into Pu-239 in a breeder reactor and become a fuel, and instantly turn even these paltry Uranium reserves into 100 times the fuel. But it doesn’t stop there.

    Uranium is everywhere. It’s why there are radon problems in many homes, as it is a waste product in Uranium decay. The problem is that there has been zero incentive to go out and find new areas to mine because the stuff is so cheap and demand is low.

    Unlike fossil fuels, however, only a tiny fraction of the cost of running a nuke plant is the fuel. If demand rises, the market price goes up, and more effort is expended recovering ore. Thus suddenly the “reserves” of Uranium go through the roof, with little effect on the price of electricity.

    Currently, the cost of uranium could go up by a factor of 10-20 and you would not notice the difference in price. But, 10-20 times the expense could go into recovering it. That means things like recovering the 3 parts per billion in sea water, or the 3 parts per million in average crust deposits become economical. This means we have at the bare minimum 100,000 years to a billion years of energy (at current usage).

    But, it does not stop there. Uranium-233 is also fissile. But that is not naturally occurring you say? Well, Thorium-234 is 4 times as abundant as Uranium and it is easily breed into U-233, which in many ways is a superior fuel to U-235. That means 4 times the energy, so we are now at 400,000 to 4 billion years on top of the 100,000 to 1 billion with uranium. If we can’t figure out another source within 500,000 to 5 billion years, we deserve to be stuck with solar and wind.

    Nuclear is our only long term answer to energy problems, short of “reducing” the world’s population to 500 million or so and reverting back to 19th century style of existence. Given the options, I will take door number 1.

  35. jsm says:

    “Our best bet is to use the local fusion reactor (the sun) to get useful energy, since we know it already gives the earth 10,000 times more energy than our current energy needs.”

    Much innovation has happened recently in solar energy that seems to have gone under the radar. Current energy prices will only encourage increased R&D in this area. The major downside, as I see it is having to use up real estate with panels to collect the sun’s energy. Certainly much area is available in the desert, but urban areas will have to use tops of buildings and other structures without affecting the comfort systems, exhaust, etc., that often occupy these areas.

    One thing many of us can do when replacing a water heater or building a house is install a solar hot water system. It sharply decreases the electric or gas energy load for water heating and seems like a pretty neat idea to me.
    http://www.hot2o.com/

  36. John Konop says:

    MSBassSinger

    A common error in analyzing a business is confusing profit % and contribution.

    If an oil company makes 7% on 2 bucks a gallon the contribution is 14 cents a gallon.

    If the price goes up to 4 bucks a gallon the contribution is 28 cents a gallon.

    As prices go up the bottom line is great in a business model if you can pass on the cost to consumers. If you cannot pass the cost on to consumers you have a big problem if you cannot adjust the model.

    The reason oil companies can pass on the price is via lack of alternative energy competition. This is why drilling alone will have very little impact on consumer price if it is done by the major supplier. And with the consolidation in the industry you have lack of competition.

    All approaches most take comprehensive approach with short term, mid term and long term planning. The fastest solution to market will be on consumption saving products.

    If a car gets twice the gas millage you are now paying 50 % less. Do you think an oil company has any vested interest in products that use less oil?

  37. John Konop says:

    FYI

    Oil 2.0: bacteria that excrete crude oil
    These genetically-modified bacteria eat wood chips and grass and excrete oil. The process is carbon negative (meaning that burning the resulting oil releases less carbon than the plants pulled in from the environment) and neither cars nor our distribution system has to be modified in any way. This is an exciting potential solution to the Middle East oil dependency.

    BTW, does anybody actually believe that there are terrific mpg-increasing technologies available, but that the auto/energy industry bought up the patents and is sitting on them? That always sounded like urban legend to me.

    UK Times: “Ten years ago I could never have imagined I’d be doing this,” says Greg Pal, 33, a former software executive, as he squints into the late afternoon Californian sun. “I mean, this is essentially agriculture, right? But the people I talk to – especially the ones coming out of business school – this is the one hot area everyone wants to get into.”

    He means bugs. To be more precise: the genetic alteration of bugs – very, very small ones – so that when they feed on agricultural waste such as woodchips or wheat straw, they do something extraordinary. They excrete crude oil.

    Unbelievably, this is not science fiction. Mr Pal holds up a small beaker of bug excretion that could, theoretically, be poured into the tank of the giant Lexus SUV next to us. Not that Mr Pal is willing to risk it just yet. He gives it a month before the first vehicle is filled up on what he calls “renewable petroleum”. After that, he grins, “it’s a brave new world”…

    http://controlcongress.com/uncategorized/oil-20-bacteria-that-excrete-crude-oil

  38. Icarus says:

    What’s wrong? In the middle of their big make out scene, they’ll be eaten by mutant bug-robot things and all that will be left in their wake will be a big puddle of oil.

    …and then I’ll blame the democrats.

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