Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Tag Archives: North Dakota

Harvard Senior Fellow: Peak Oil Is History

Abu Dhabi skyline

With the publication of his careful study, “Oil: The Next Revolution,” internationally respected economist and senior fellow at Harvard University Leonardo Maugeri has persuasively buried the theory of “peak oil” beneath 75 pages of evidence to the contrary. He wrote:

Contrary to what most people believe, oil supply capacity is growing worldwide at such an unprecedented level that it might outpace consumption. This could lead to a glut of overproduction and a steep dip in oil prices….

After adjusting for risk factors…net additional production capacity by 2020 could be 17.6 mbd [million barrels per day], yielding a world oil production of 110.6 mbd by that date….

This would represent the most significant increase in any decade since the 1980s.

At present total world production of oil is estimated at 73 mbd, and so if Maugeri is correct, that 110 mbd production will be 50 percent higher than today. That will confirm Maugeri’s prediction this “could be a paradigm-shifter for the oil world.”

Maugeri’s credentials are impressive. For 10 years he was the senior economic advisor to

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The Oil Bubble is Good for U.S. Manufacturing

A bubble.

The rising oil production from North Dakota’s Bakken Formation now equals that of Alaska’s Prudhoe Bay for the first time, according to the Wall Street Journal, due to technological breakthroughs such as fracking.

The recent surge in oil prices from under $80 a barrel last summer to over $110 per barrel in February has prompted a flurry of activity by oil producers to get in on the action. The price of leasing properties thought to hold millions of barrels of reserves has exploded, in some cases tenfold, in Pennyslvania, Texas and elsewhere. These are prices not seen since before the onset of the Great Recession in 2007, with Chinese, French and Japanese explorers committing $8 billion just in the last two weeks to secure oil leases.

Marubeni Corporation, a Japanese commodity trader, agreed to pay $25,000 an acre for a piece of Hunt Oil Company’s Eagle Ford shale property in Texas, while Marathon Oil closed on a lease nearby at $21,000 an acre. Leases in Utica shale in Ohio and Pennsylvania jumped ten-fold in just five weeks to $15,000 an acre.

Others, such as Exxon Mobil and Royal Dutch Shell are reconsidering deep-water discoveries in West Africa and in the Gulf of Mexico now that

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Gas Prices Up, Obama Poll Numbers Down

$4.06 Gas Prices, Lewiston, Maine, Cumberland ...

As gasoline prices approach (and in some places exceed) $4 a gallon nationally, the president appears to be taking much of the blame with two recent polls showing sharp declines in support for his handling of the issue.

The latest Washington Post/ABC News poll now shows a record number of Americans giving the president “strongly” negative reviews on his handling of the economy. Nearly two-thirds of those polled say they disapprove of how he is handling gas prices compared to just 26 percent approving—his lowest rating by the poll. Specifically, 59 percent of those polled disapprove of his handling of the economy in general, a jump of 9 points in just one month and this despite the appearance of some signs of an improving economy. Most of the damage being done to Obama is among independents with 57 percent now disapproving, along with 66 percent of white non-college graduates disapproving as well.

The New York Times/CBS poll also showed the president losing 9 percentage points of approval during the past month, with 47 percent of those polled voicing their disapproval.

In a third poll by the Christian Science Monitor two-thirds of those polled say that the government should allow increased production from offshore wells and from shale deposits on federal lands as a way to increase supply to bring down prices. 54 percent favor drilling in the Arctic National Wildlife Refuge (ANWR) in Alaska, while 47 percent favor rolling back some environmental restrictions to help increase energy production. That poll also reflected expectations that the price of gas will exceed $4 a gallon nationally within the next three months and one-third of those polled are expecting $5 a gallon gas by summer.

The president’s response has been, as it has been since his election, to push for alternative energy resources such as renewables and wind. His recent decision to stop the Keystone XL Pipeline project reflects his commitment to raising prices on oil in order to make alternatives more attractive. His comment on Saturday’s weekly address that “We can’t just drill our way to lower gas prices,” reflects that ideology.

In North Dakota, however, that is precisely what is being done to increase oil production, with North Dakota on track to overtake

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North Dakota: A Study in How the Free Market Works

English: An Oil Pump in western North Dakota

The continuing boom in North Dakota seemingly has no end. Last June oil production from the Bakken Formation exceeded 11 million barrels a month. In February it reached 16 million with estimates that by late spring North Dakota could be producing more oil than either California or Alaska. That’s more than double what the state produced just two years ago.

The population boom in Williston and elsewhere continues to set records. The oil industry employs more than 30,000 people and could exceed 100,000 if production rises as expected to a million barrels a day. There are so many job openings that the state is sponsoring trade fairs across the country and has to deal with—are you ready?—budget surpluses!

Comparisons between North Dakota and other states struggling with deficits and high unemployment abound. Steve Moore wrote about it in the Wall Street Journal, noting that North Dakota has a budget surplus of $1 billion out of a $3.5 billion budget and it has already cut income taxes and is considering further reductions. Complete funding for the state’s pension plan is accomplished every year and the state is building “infrastructure” projects: roads, bridges, railroads and pipelines.

Moore compares this to the issues facing California: five straight years of budget deficits with the current fiscal year’s shortfall expected to exceed

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Rising Oil Production in Alberta: More Evidence Disproving Hubbert’s Peak

English: Alberta, Canada Français : Alberta, C...

The latest report from the Calgary Herald (Alberta, Canada) was nothing but good news: The steadily declining production of light oil from 2002 to late 2010 has reversed itself completely and is now not only proving the power and principles of a free market but “will change the way we think about oil, with many weighty consequences…” says blogger Peter Tertzakian. The graph he provided here shows Alberta’s production declining by about 16,000 barrels per day (B/d) every year since 2002, dropping to just over 300,000 B/d in late 2010. Now, thanks to new capital, new technology, and new enthusiasm, production is close to 400,000 B/d. It also “could heighten the blood pressure of a few peak oil theorists,” said Tertzakian.

He refers to the theory first offered by M. King Hubbert in 1956 that claimed that oil production in the United States would reach its peak between 1965 and 1970 and begin to decline thereafter. It was based upon the assumption that the amount of oil reserves is fixed and that it is analogous, according to peak theory supporter Colin Campbell, to a glass of beer: “The glass starts full and ends empty, and the faster you drink it, the quicker it’s gone.”

From that theory, Hubbert then claimed that this would drastically alter life in the United States, predicting chaos, war, starvation, economic decline and possibly even the extinction of mankind.

As Daniel Yergin (Pulitzer Prize-winner for his book The Prize: The Epic Quest for Oil, Money and Power) noted in the Wall Street Journal, this prediction of the “end of the world as we know it” was one of many such predictions, each one of which never came true. “Hubbert’s Peak” moved from the 1970s to 2005 and then to 2011, and is now expected sometime before the year 2020. But it’s all based on one primary faulty assumption: that the

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Drones: Newest Tool of the Surveillance State

English: Air Force officials are seeking volun...

Evidence that New York City is considering using drones to keep an eye on its citizens is growing, according to Don Dahler of New York’s CBS Channel 2. Dahler quoted an email it obtained indicating that a detective in the New York Police Department’s counterterrorism division asked the Federal Aviation Administration “about the use of unmanned aerial vehicles [UAVs] as a law enforcement tool.”

Dahler noted that NYPD commissioner Joe Kelly suggested that drones would be useful: “In an extreme situation, you would [then] have some means to take down a plane.” A spokesman for the NYPD admitted that “We’re always looking at technology. Drones aren’t that exotic anymore. Brookstone sells them. We’ve looked at them but haven’t tested or deployed any [yet].”

A retired officer from the department said that the use of drones would help protect the police from physical danger: “Not only would it be a form of surveillance gathering to protect the public, it also in many respects removes the officers…from harm’s way.”

UAVs, or drones, have benefitted enormously from advances in technology. Increasingly used in the wars in Iraq and Afghanistan to target terrorists, drones can take photographs of license plates and citizens’ faces from elevations of 10,000 feet. They are essentially silent and can be maneuvered by the operator located miles away in a small government cubicle. They can fly at night and take pictures using infrared and ultra-violet technology. They can stay in the air up to 20 hours at a stretch, with improvements using solar panels likely to extend such operations around the clock. The drones’ technology can see through dust storms and roofs and walls of buildings, and even below the earth’s surface. In other words, drones’ capabilities mean there is no place to hide.

This capability extends the reach of the surveillance state even beyond the

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Not All Economic News is Bad News

English: There's a light at the end of the tun...

Republican presidential candidate Ron Paul noted on Tuesday that efforts to rein in government spending appeared to be in vain, due to an agreement reached with the White House during the recent debt ceiling negotiations. Congress would have to pass a joint resolution to oppose any extension of the debt ceiling, which President Obama is free to veto. Said Paul: “A default is becoming more mathematically unavoidable with…every debt ceiling increase.”

Not only is the word “default” becoming commonplace but also the words “economic collapse.” A study conducted by Leflein Associates and published by EcoHealth Alliance showed that of the 1003 individuals interviewed for the survey, 63 percent—or more than six out of ten of them—feared an “economic collapse” more than a natural disaster, a terrorist attack or a global outbreak of disease. This study was picked up by Michael, the author of his Economic Collapse Blog, who piled on by adding a long list of reasons why concerned citizens should be afraid of such an event: 

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Latest Housing Numbers May be an Aberration

English: Foreclosure Sign, Mortgage Crisis

The spate of good news about the economy, headed up by the National Association of Realtors (NAR)’s report that pending home sales increased by 7.3 percent in November from October, has resulted in improved outlooks by many observers, along with warnings from others not to get overly confident.

Even Lawrence Yun, NAR’s chief economist, was cautious in his announcement, perhaps chastened by NAR’s admission last week that they had overstated sales for the past five years: “Housing affordability conditions are at a record high and there is a pent-up demand from buyers who’ve been on the sidelines, but contract failures have been running unusually high.” And to avoid making the same mistake twice, Yun said that some of the increase in pending home sales may be people who couldn’t qualify before who are attempting to make another purchase now.

The pending home sales index hit 100.1, the first time it has been over 100 since April of 2010 when sales were goosed by the expiration of the government’s homeowner tax credit. Actual home sales were up in November as well, hitting a seven-month high, according to the Commerce Department.

New construction activity is inching higher along with builder confidence while the inventory of homes for sale is declining. Aaron Smith, an economist at Moody’s Analytics, was cautious: “It looks like buyers are

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The Story Behind the Best- and Worst-Run States

Seal of Wyoming

In its second annual survey of the best- and worst-run states, 24/7 Wall St. noted some significant changes but the same message: “States can do a great deal to control their fate.”

The report noted:

Well-run states have a great deal in common with well-run corporations. Books are kept balanced. Investment is prudent. Debt is sustainable. Innovation is prized. Workers are well-chosen and well-trained. Executives, including elected and appointed officials, are retained based on merit and not politics.

Based on data collected from numerous sources such as Standard & Poor’s, the Bureau of Labor Statistics, the U.S. Census Bureau, and the Tax Foundation24/7 Wall St. then ranked each state on its performance in 10 categories. The study concluded that the best-run state was

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Smackdown: Green Jobs vs. Real Jobs

English: Wind Turbine

The Wall Street Journal virtually called the Obama administration’s efforts to create “green” jobs a joke, decrying the President’s efforts to jump-start the economy with them as mere “conjuring” and suggesting instead that he drop his “ideological illusions” and face reality.

The reality is that no matter how much of other people’s money the President throws at the “clean” renewable alternative energy sector to force it to generate jobs, his efforts have been an abysmal failure. The name Solyndra is now synonymous with “loser” and the Washington Post reported last month that Obama’s green loan program of $38 billion has created just 3,500 jobs in two years instead of the 65,000 anticipated by the White House.

Instead, real jobs are being created in the real energy industry—in Pennsylvania, North Dakota, Texas, Louisiana, and Oklahoma. In the first six months of this year,

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American Oil Development Undermines Green Movement, OPEC

Oil Derrick

The September 15 report from the National Petroleum Council expressed surprise at how much has changed just since their “Hard Truths” report of 2007 that domestic energy development was falling behind escalating demand.

The “Hard Truths” report stated that although “the world is not running out of energy resources…there are accumulating risks to continuing expansion of oil and natural gas production…[which] create significant challenges to meeting projected total energy demand.” As a result, the concept of “Energy Independence” is “not realistic in the foreseeable future” and therefore “the United States must moderate the growing demand for energy.”

In NPC’s letter to Secretary of Energy Steven Chu introducing the latest study, chairman James Hackett said

Extraordinary events have affected energy markets in the years since the NPC reported on the “Hard Truths” about energy in 2007. That study concluded that the world would need increased energy efficiency and all economic forms of energy supply.

This is still true today, but since then,

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The Oil Map of the World Is Shifting to the West

Trans-Alaska Oil Pipeline

Writing in the Washington Post on Friday, Daniel Yergin, author of The Prize: The Epic Quest for Oil, Money and Power (which was adapted into a mini-series by PBS in 1992) explored the shift of oil’s epicenter from the Middle East to the Western Hemisphere, expressing his surprise that “what appeared to be irreversible is being reversed.” He explains:

The new energy axis runs from Alberta, Canada, down through North Dakota and South Texas, past a major new discovery off the coast of French Guyana to huge offshore deposits found off Brazil.

The transformation is happening not as part of some grand design or major policy effort, but almost accidentally. This shift was not planned—it is a product of

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Bernanke’s Invisible QE3 and the Austrian School

Wall Street

Image via Wikipedia

Wall Street professionals’ expectations are modest over Federal Reserve Chairman Ben Bernanke’s highly anticipated remarks at the Jackson Hole symposium this Friday. Unlike last year when the chairman announced the start of his program to purchase government securities in order to keep the economy from slipping into a recession and possibly deflation, known as Quantitative Easing II (QE2), his options now are much more limited. The anticipated bounce in the economy has fizzled, inflation is increasing, the banks are stuffed full of reserves but few are borrowing, and interest rates

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Good News: North Dakota’s Economy Doing Just Fine, Thank You

Artist's rendition of a shale oil extraction p...

Image via Wikipedia

Finally, some good news about the economy, from an unlikely place: North Dakota. CNNMoney reported that while the United States’ economy grew at less than 3 percent last year, North Dakota’s grew by more than 7 percent. And with national unemployment over 9 percent, in North Dakota it is just over 3 percent (and hasn’t touched 5 percent there in more than 20 years).

The prime driver is the discovery of

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Internet Sales Tax Collection Gaining Momentum

amazon

Image by Manuel Alarcón via Flickr

When California Governor Jerry Brown (left) signed into law that state’s latest attempt to collect Internet sales taxes from retailers outside the state, he surely must have known he would be hurting, perhaps eliminating altogether, at least 25,000 small businesses. But the opportunity to collect an estimated $200 million in uncollected taxes overrode that consideration. Amazon.com, with gross sales of $34 billion annually, generates much of its revenues through affiliates who offer the opportunity to their customers to “click through” their websites and purchase products from Amazon. In an email sent to its California affiliates on Tuesday, Amazon said:

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Democrat Retirements a Trend or a Tsunami?

Christopher Dodd, U.S. Senator.

Image via Wikipedia

The announcements by Democrat Senators Chris Dodd (Conn.) and Byron Dorgan (N.D.) last week that they will not be running for reelection in 2010 raised both concerns by Democrats and hopes of Republicans.

Senator Dodd’s announcement has been examined thoroughly elsewhere on this site, but Senator Dorgan’s announcement was an unexpected bombshell that followed announcements by Alabama Representative Parker Griffith that he was switching parties from Democrat to Republican, along with the retirement announcements from two Democrats from Tennessee and another one from Kansas. The battles that are currently raging in Nevada for Senate Majority Leader Harry Reid’s seat and in Pennsylvania for Democrat Senator Arlen Specter’s seat, along with the battles in Illinois and Delaware to fill the Senate seats formerly held by Democrats Barack Obama’s and Joe Biden, indicate more than just a midterm election shift.

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Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.