Intensity of U.S. Energy Use in Manufacturing Decreases as Output Outpaces Fuel Use

The energy intensity of U.S. manufacturing has continued to decrease, according to the latest data from EIA’s Manufacturing Energy Consumption Survey (MECS). From 2010 to 2014, manufacturing fuel consumption increased by 4.7%, while real gross output increased by 9.6%—or more than twice that rate—resulting in a 4.4% decrease in energy intensity.

Like EIA’s consumption surveys of the residential and commercial sectors, MECS is conducted on a periodic basis. The latest MECS release provides manufacturing energy consumption, energy expenditures, and other energy-related metrics based on data collected in 2015, which reflects activity in 2014. The U.S. Energy Information Administration has conducted the MECS survey eight times since the initial MECS survey in 1985. The 2014 MECS sample size of approximately 15,000 establishments was drawn from a sample frame representing 97% to 98% of the national manufacturing payroll.

Although many manufacturing establishments are taking steps to reduce their energy consumption, the energy intensity decrease for total manufacturing is mostly the result of a shift of manufacturing output from energy-intensive industries, such as the manufacture of metals, chemicals, paper, and petroleum and coal products, to less energy-intensive industries. If major industries had maintained the same proportions of the manufacturing sector, the energy intensity decline between 2010 and 2014 would have been 0.7% instead of 4.4%…

 

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Crude Oil and Petroleum Product Exports Reach Record Levels in the First Half of 2017

Crude oil exports in the first half of 2017 increased by more than 300,000 barrels per day (b/d) from the first half of 2016 to 784,000 b/d, a 57% increase. Petroleum product exports also grew over the same period. Crude oil and propane exports each reached record highs of 0.9 million b/d, and distillate exports reached a record high of 1.3 million b/d.

Following the removal of restrictions on exporting U.S. crude oil in December 2015, total volumes of crude oil exports and the number of destinations for those exports both increased. The United States exported crude oil to 26 countries in the first half of 2017 compared with 17 countries in the first half of 2016.

Canada remained the largest recipient of U.S. crude oil exports at 248,000 b/d in the first half of 2017 but imported an average of 46,000 b/d fewer than in the first half of 2016. China increased its crude oil imports from the United States by 154,000 b/d and became the second-largest importer of U.S. crude oil, averaging 163,000 b/d in the first half of the year…

 

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U.S. Crude Oil Production Expected to Increase Through End of 2017, Setting Up Record 2018

EIA forecasts that U.S crude oil production will average 9.4 million barrels per day (b/d) in the second half of 2017, 340,000 b/d more than in the first half of 2017. Production in 2018 is expected to average 9.9 million b/d, surpassing the previous high of 9.6 million b/d set in 1970, based on projections in EIA’s Short-Term Energy Outlook (STEO).

The STEO projects that most of the crude oil production growth in the second half of 2017 will be in the Permian region, which extends across western Texas and southeastern New Mexico and has become one of the more active drilling regions in the United States. Production in the Permian continues to increase, in part, as a result of West Texas Intermediate (WTI) crude oil average monthly prices that have remained higher than $45 per barrel since the second half of 2016.

In the STEO, EIA publishes crude oil production projections for Alaska, the Federal Gulf of Mexico, and the aggregated Lower 48 states. However, each month in the STEO, EIA models oil production for certain states and regions within the Lower 48 states. STEO’s projected U.S. production changes for the second half of 2017 are discussed in more geographic detail in the latest This Week in Petroleum, which includes information on production in the Permian, Niobrara, Anadarko, Bakken, Eagle Ford, Alaska, California, and the Gulf of Mexico…

 

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Excellence in Delivering Performance, Ops Integrity, and Safety.

In this two part series, we are looking to dig deeper into the subjects of optimal performance and operational safety at the front line, beyond engineering aspects and processes.

During our last article with Phil Smith (How the Improvement of Operational Integrity, Safety, and Human Factors Equals Excellence in Performance, published on 12 Sept 2017), we covered some aspects of human psychology and human factors, and their potential for practical refinement in the field. In this article we take the concept a step further and start to flesh out the potential areas and actions steps that can be worked on.

Training in the key Human Factors elements assists to bring the value of Well Operations Crew Resource Management into focus…

 

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Spark and Dark Spreads Indicate Profitability of Natural Gas, Coal Power Plants

Relative profits for some natural gas- and coal-fired generators in several Midwestern and Mid-Atlantic states may have decreased since 2016 because of higher natural gas and coal prices and lower wholesale electricity prices. A common measure of profitability for power plants within a region is the difference between their input fuel costs, such as the cost of coal or natural gas, and their wholesale power price.

For electric power generation fueled by natural gas, this difference is called the spark spread; for coal, the difference is called the dark spread. Spark spreads and dark spreads in the first part of 2017 were lower than the 2016 averages in the PJM Western hub, which covers electricity generation in parts of several Midwestern and Mid-Atlantic states.

Changes in spark spreads and dark spreads for a given electricity power market indicate the general operational competitiveness of coal-fired or natural gas-fired electric generators in meeting the market’s electricity demand. These spreads are calculated by comparing the day-ahead, wholesale power market price with the delivered input price of the fuel, and are adjusted for the energy content of the fuel and the relative conversion efficiency of power plants. These values can then be compared with wholesale power prices, which, in this example, are the average day-ahead prices at the PJM Western hub

 

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WAGUESPACK: Go Vote This Weekend. Support Amendment #1.

Louisiana Secretary of State, Tom Schedler, a well-known and trusted voice, said this week that he expects turnout to be around 15% for Saturday’s election. He is basing that prediction on historical averages and the fact that the turnout for the early vote in this race was just 3% of eligible voters.

3…measly…percent.

If his prediction holds true for Saturday’s turnout, it would mean that 85% of the roughly 3 million registered voters in Louisiana will simply not vote at all. Another way of looking at it is that over 2.5 million may just decide to skip the election altogether…

 

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Oil Breaking Out, But the Money Is Elsewhere

One resource industry dwarfs the rest of them put together: energy.

The mega-shift of the 21st century is urbanization. For the first time in human history, more people live in cities than in rural areas. The consequences of this pivotal moment are attracting billionaire moguls across the globe, and they are all looking for a profit center to attach themselves to.

In terms of fuel for cars, gasoline, made up of oil, accounts for the overwhelming majority of existing consumption, but this is changing dramatically because of the hyper-growth of electric vehicles on our roads…

 

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The “Amazon Effect” Is Coming To Oil Markets

While OPEC mulls over further steps to once again support falling oil prices, tech startups are quietly ushering in a new era in oil and gas: the era of the digital oil field.

Much talk has revolved around how software can completely transform the energy industry, but until recently, it was just talk. Now, things are beginning to change, and some observers, such as Cottonwood Venture Partners’ Mark P. Mills, believe we are on the verge of an oil industry transformation of proportions identical to the transformation that Amazon prompted in retail.

According to Mills, the three technological factors that actualized what he calls “the Amazon effect”, which changed the face of retail forever, are evidenced in oil and gas right now. These are cheap computing with industrial-application capabilities; ubiquitous communication networks; and, of course, cloud tech…

 

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The Russia-Saudi Bromance

The history of OPEC and how it came to wield such power is one of two entities. On one hand, is OPEC – a coalition of the world’s largest oil producers. On the other, America, and to a lesser extent Europe, dependent on the former for energy. It worked in the 1970s, when the oil shocks proved the potency of supply restrictions. In the decades since then, OPEC has lost a lot of power. Sources of oil and gas have diversified. The USA is now on track to be a net exporter of crude and natural gas. Europe is charging towards a future that diminishes the need for hydrocarbons. And OPEC is no longer the biggest boy in town; Russia is now the world’s single largest oil producer – and has been China’s top oil supplier for several years now.

Back in 2015, as the energy industry was grappling with the aftermath of plunging prices, Russia stated that it had ‘no intention of cooperating with Saudi Arabia.’ Yet, just last week, the Saudi King Salman visited Russia. A joint US$1 billion fund was announced to invest in energy projects. In the space of two years, Russia has gone from OPEC’s main competitor to an unofficial co-president, brokering the current supply deal that has been credited for keeping oil prices stable (or at least, not plunging).

With Donald Trump’s presidency in the USA, former allies and enemies are looking to form new alliances. Even Angela Merkel was forced to admit that the EU now had to consider ‘a future without the USA.’ For Russia, the American presidency has been extremely challenging to work with, especially with the recent Congress-led sanctions. This bites down hard on Russia’s ability to do business. With the EU also threading a delicate relationship, Russia has to find new friends…

 

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Nigerian Oil: Blending Indigenous Roots and International Ambitions

What makes a firm essentially Nigerian? Certainly not where it operates, but rather its people. Who founded it, who directs its day-to-day management and longer-term strategic direction. Who ‘calls the shots’ in other words.

However, there is another question. A lot of oil firms claim to be indigenous firms, and do so as a badge of honour. But why? What difference does it make?

First of all, the fact that some of Nigeria’s oil prospecting and mining leases are owned by home-grown firms should be something to be proud of. We are an enterprising nation and the fact that our own indigenous talent should be able to manage the location, extraction, production and exporting of our most abundant natural resources is a good thing

 

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