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Posts Tagged ‘Biofuels’

0 Jun 18 2010 @ 9:57am by Matt Smith in Biofuels, Capital Markets, Crude Oil, Economy, energy consulting, Global Energy, Natural Gas, Random, risk management, Risk Strategy, Technology, UK natural gas

An Energy Perspective

This post isn’t a post – it’s a link to a guest post out on the Houston Chronicle. The guest post is pilfered, cribbed and cropped from a speech I did in London this week for the shindig at Shakespeare’s Globe to launch our UK office. It basically outlines who is going to win the World Cup, through comparing and contrasting various aspects of the energy complex to eight teams. So please click on the below image to be directed away from this imposter, to the real post:

No burrito bites this week – apologies – I will double down on the delicacies next week. Have a splendid weekend!

0 Mar 19 2010 @ 9:50am by Matt Smith in Biofuels, Crude Oil, Economy, Global Energy, Natural Gas, Technology

Burrito Bites

As we come to the end of another week, there seems to be more questions than answers; will natural gas bounce from $4 psychological support? Will crude break its November high? What will fill the hole in people’s lives after March Madness? All of these questions will be answered in time. To occupy yourself while you wait, feast your eyes on this week’s nibbles:

–Ethanol is making a comeback.

Upside-down house in Germany.

–No end in sight to US refining weakness.

Visualizing the internet – top 100 sites, rich list etc…interesting stuff.

–Plenty of gas, but no easy fix for US energy challenge.

Trying to pick peak oil is futile.

–I thought soggy moggy was bizarre, until I saw surfing with animals.

–Gasoline prices are up to their highest level since 2008.

–Will they / won’t they? – the Greek bailout meter.

–Art imitating life – fake store fronts brighten up town.

–The Big Mac Index shows the Chinese Yuan is still undervalued.

Europe unlikely to match US shale boom.

The Burrito Deluxe Award of the week goes to the website 1000 awesome things for brightening up the week by its mere existence.

The Burnt Burrito Award of the week goes to Opec. As their compliance with output quotas goes through the floor (more production, more $$$), their influence wanes. Or at least their credibility.  The biggest surprise to come out of their latest meeting on March 17th was that they have decided not to meet for another seven months. That’s a lot of time for them to keep rubbing their hands with glee before they need to pull quota compliance back in line.

And finally for the winner of last week’s competition – I split the prize between R E Parker Esq and Ginny – both providing amusing yet low-brow responses. A gift card for a burrito is on its way to both of you! 

May your weekends be filled with 1000 awesome things.

3 Feb 17 2010 @ 10:45am by Matt Smith in Biofuels, Global Energy, Technology

Topic #153 that I find fascinating but need to know more about: Algae

There is something about algae that I find absolutely fascinating. I don’t know if it’s because I find it so incredulous, but producing biofuel from squeezing seaweed really hard (presumably that’s how they do it) is mind-boggling to me. Hence its charm.   

algaeAlgae, or Oilgae as those in-the-know like to call it (ie – not me), is taking over the mantle as the potential savior of biofuels, as the energy world scrambles to find a way to meet the renewable fuels standard, a law requiring the US (stipulated by,erm, the US) to produce 36 billion gallons of biofuel by 2022. 

The US government, having passed the law five years ago, are obviously getting a little tetchy about achieving the goals they have outlined. The data aren’t fully in yet, but preliminary results indicate that the US has fallen short of their mandated level for 2009 of 11.1 billion gallons, and are keen to find a solution to such a behemoth of a problem. Hence, their interest in algae has been piqued, with $80 million in stimulus money recently paid out to research algae-based biofuels.

To add (bio)fuel to the fire, the cause is also not without the support of ‘big oil’. Exxon Mobil’s first ever venture into the green arena has been to team up with algae research company, Synthetic Genomics, in an initial $300 million joint venture. Admittedly, this is spare change (almost a gesture?) when compared to Exxon’s annual capital and exploration spend of approximately $30bln (= more than the US government’s renewable energy budget) . However, as an affirmation of algae’s potential, there doesn’t come any higher endorsement. 

...not to be confused with the DARPA Initiative...

...not to be confused with the DARPA Initiative...

Last April the Pentagon tasked DARPA, who helped to develop some of the most revolutionary technology used today (from the internet to a propane-powered GPS system), to develop algae as a biofuel on a large enough scale to supply the entire US military. All becomes clear when it’s realized the US military is the largest single consumer of energy in the world (60 – 75 million barrels of oil a year); oil dependence on the countries you could potentially be at conflict with is not ideal.
 
As for the recent ripples of excitement, these were caused by an article in the newspaper, The Guardian, last weekend. It claims that DARPA’s research shows they are already producing biofuel from algae ponds at a cost of $2/gallon, and are months away from developing the technology to produce biofuel for $1/gallon – similar to gasoline costs. And we are not talking niche quantities here; a 50 million barrel-per-year refining operation could be up to speed within the next two years. 

This revelation has taken the biofuel industry by surprise – even algae producers. This has also followed hot on the heels of a backlash against algae in a study released last month, which stated algae required much more water and energy to produce than originally projected. This claim was vehemently refuted by market players.

36 beeellion gallons

36 beellion gallons

So in a bizarre twist, in a world where technological advancement is making madcap biofuel visions a reality, algae looks well positioned to lead, or at least be a part in this effort. In similarly interesting news this week, British Airways announced they will be producing their own biofuel from London garbage. Who would have believed even five years ago that jet fuel would be being produced from seaweed and trash? Modern life is indeed rubbish.

As with its predecessors, algae has been placed on a pedestal, which is set to wobble and topple under the weight of its own expectations. Other fuels have received similar treatment – jatropha (=topic #137 I found fascinating but needed to know more about) and corn-based ethanol, to name but two. If only expectations could be tempered somewhat, algae could be perceived for what it is – another paving stone on the path to oil independence, but not the path itself.
1 Jan 6 2010 @ 10:45am by Matt Smith in Biofuels, Capital Markets, Crude Oil, Economy, Natural Gas, Technology

10 things I expect will happen in 2010.

1) Crude oil will break $100. As demand picks up (especially in Asia), stockpiles are reduced, and (undue) inflationary fears mean funds fly into commodities. Consensus across the board is looking at a range of $70-$80, so this is exactly what will not happen.

2) The high for the natural gas prompt month for 2010 will be three times larger than the prompt month low in 2009.

square root

The square root recovery.

3) The US recovery will be much less of a ‘v-shape’ and more of a square root (we are already in the bounce) or a squigle (= wobbly, in a weebles wobble but they won’t fall over kind-of-way). Although US GDP for Q4 ’09 and Q1 ’10 is set to come in with impressive gusto, this will not be sustained throughout 2010 as the inventory boost proves to be transitory, consumer spending stutters, a housing recovery splutters, and a waning stimulus package is unable to spur a robust recovery.

square root too

Look familiar?

4) Smart grids will be one of the buzzwords of 2010, as public and private funds flow into energy technology as the investment hotspot of the year. All things associated with natural gas will also be a hotspot for investor flows, as the fuel becomes an ever-more attractive option for US non-reliance on global resources. 

5) The unemployment rate continues to worsen, despite intermittent blips of improvement. The rate finally peaks closer to 11% than 10%. 

6) Inflation causes very little concern in 2010 until the latter stages of the year, after the Fed withdraws monetary stimulus and starts to consider raising rates. This will either put downward pressure on crude oil, as the US dollar becomes more attractive due to an impending higher interest rate, or (more likely) the bosom-buddy correlation between crude and the US dollar comes to an acrimonious end. » read more

3 Oct 4 2009 @ 12:30pm by Matt Smith in Biofuels, Global Energy

Topic #137 that I find fascinating but need to know more about: Jatropha

boba_fett

Boba Fett

When cheap jerseys countries such as Zimbabwe announce that they aim to achieve 10% of their fuel needs by 2017 cheap jerseys from biodiesel processed from the weed-like plant, Jatropha, you realize ETF something wacky is going on. While I think that Jatropha sounds like a character from Star Communist Wars – Jabba the Hut’s second-string bounty hunter when Boba Fett is on vacation (I wonder where wholesale jerseys he’d go?) – it has been making headlines across the globe for a number of years now. This is because jatropha is a plant that is apparently environmentally sustainable; it can grow in desolate conditions on land cheap mlb jerseys not suitable for the majority of crops, it wholesale mlb jerseys can survive on limited rain and does not require irrigation, and, the kicker: it yields a vegetable oil from seed pods which can be processed into biodiesel. Indeed, Zimbabwe is not the Drupal. only country to be pursuing this potential opportunity. Air New Zealand tested a Jumbo Jet late last year on fuel partly derived from jatropha biodiesel. India is the current leading global producer of jatropha, with 4.5 million acres earmarked for growing the crop, providing a prime example of how such a crop can thrive in extreme weather conditions.

jatropha_curcas

Jatropha

All is not rosy, however, with jatropha currently enduring a bit of a demand backlash. Not only has BP recently exited a partnership in a jatropha biofuel project to focus Age on ethanol instead, but a recent scientific study by Envirocare also concluded that jatropha requires more water than previously thought. There are also concerns that expanding the farming of jatropha could displace farmers and replace food crops. 

Jatropha may not be a household name yet, but if it can overcome current headwinds and live up to some of its potential, part of the solution to global sustainability With could sound strangely similar to a  vacation-bound Star Wars bounty hunter….