ConocoPhillips, the US’ third biggest oil company, has become the latest major company to drop out of USCAP, the US Climate Action Partnership, a ceo-led organization aimed at advancing comprehensive climate and energy legislation. BP, the UK oil major, and Caterpillar, the equipment manufacturer, also have quit the organisation.
It is a significant blow for the campaign to bring in carbon dioxide emissions controls in the US.
ExxonMobil, the world’s biggest western publicly listed oil company, has claimed more reserve additions in 2009 than in any year in the past decade, as massive liquefied natural gas projects from Papua New Guinea to Australia brought in almost 1bn oil-equivalent barrels. At the end of 2009, Exxon’s proved reserves base, using its own definition of year-end reserves, increased to 23.3bn oil-equivalent barrels, split evenly between liquids and gas.
Additions to its proved reserves in 2009 totaled 2bn oil-equivalent barrels, replacing 133 per cent of production. Using the Securities and Exchange Commision’s pricing basis, Exxon’s proved reserves replacement was 1.5bn oil-equivalent barrels in 2009, replacing 100 per cent of production. Exxon uses the long-term pricing basis that the corporation uses to make its investment decisions in doing its internal calcuations. This is different from the SEC, which uses 12-month average prices for the 2009 year-end reserves calculation.
Though the definitition of reserves replacement used by the SEC and Exxon internally are different, the trend is the same. And that is that Exxon is doing better than it has in some time in replacing reserves, partly because of its increased focus on natural gas.
President Barack Obama is expected to announce this week loan guarantees for two new nuclear reactors, underlining the administration’s impatience to move forward America’s clean energy future given delays by Congress. The loan guarantees, expected to be in the billions of dollars, will provide the financial incentive the industry needs to build the first new nuclear reactor in the US in three decades.
They follow President Obama’s call for new nuclear in his State of the Union Address and a 2011 budget request for $54bn in loan guarantees- almost tripling the size of the existing guarantee program. The budget also calls for $495 million for nuclear energy research and development.
Coming on the heals of the Administration’s move to take on regulation of carbon emissions, the push for new nuclear signals President Obama is determined to move forward clean energy initiatives that have been held hostage by a Congress that cannot agree on the path toward a low carbon future.
Daniel Yergin, chairman of IHS CERA, the consultancy, is bringing some perspective to the outcry over China’s rapid move to capitalize on the clean-energy economy. The argument is that China, as the world’s biggest solar panel and wind turbine manufacturer, is moving to capitalize on the rush into alternative energy, while the US is falling behind. Certainly, the US is behind.
Congress cannot seem to agree on what legislation to pass to encourage US development of wind, solar, biofuels and any other renewable energy. And these industries are calling for more govermnent assistance, through a Renewable Electricity Standard or more subsidies. A recent study, called, Job Impacts of a National Renewable Electricity Standard, conducted by independent firm Navigant Consulting and released by the RES Alliance for Jobs, certainly backs up their cry for help, noting that without stronger near-term targets than currently envisioned, industries like wind will experience flat job growth and long-term stagnation and the US biomass industry could collapse altogether.
But, despite the failures of the US government to provide significant support for a clean-tech industry, Mr Yergin notes all the discussion about how the Chinese are stealing the leaderhip in this area is overplayed. In his own words:
It’s not that they will have a secret elixir or the key to the technology. They’re going to have the same advantage they have on everything else. And that is that low-cost manufacturing. To compete with the Chinese, the US will have to compete on quality and service for such equipment as wind turbines and on creativity and ingenuity for new innovations.
The bottom line is that, in the area of clean-energy quality and service, the US can still provide leadership. It is unlikely to come from the government, however, so industry must continue forging ahead on its own.