Thursday, June 19, 2008
In his call for offshore drilling, President Bush also called for more oil refineries in the US:
The four-point plan proposed by Bush would:
* Increase access to the outer continental shelf...
* Encourage the extraction of oil from shale in the West...
* Permit drilling in the Arctic National Wildlife Refuge...
* Expand oil refineries in the U.S., where a refinery has not been built for three decades. Bush proposes regulatory reforms that could remove barriers to refinery construction — namely public opposition...
Some democrats have proposed that the government should take control of the issue by taking over the refineries
But do we really need new refineries? Big oil says no:
Yesterday, as part of a daylong seminar on the energy industry for reporters at the Chronicle's offices, Exxon Mobil Vice President Kenneth Cohen offered some insights on why the company doesn't build more new refineries in the U.S. Basically, Cohen said, building even a small refinery would require an investment of $2 billion to $3 billion.
"Once you've made that investment, what you're looking at is `what's the growth?' It's just like any other business," he said.
Exxon predicts U.S. oil demand may begin to fall by 2030, which means the company faces a limited window for return.
Even Exxon is willing to admit that demand for oil may begin to fall by 2030, and they're planning for a future in which alternates play a larger role.
If big oil doesn't want more refineries, who does want them?
Why, our friends in Saudi Arabia, of course. They've got lots of smelly crude to sell, and few current refineries want to buy it.
Some people don't know how to plan for the future...
How about more oil refineries price of gas goes down.. Exxon makes less money per unit maybe on slightly higher volume.. so it's a wash for them and they have to spend 2-3 billion for the wash... so instead they say oil demand will wane by 2030? How's that going to happen with a growing India and China already using more oil than we do?
Pllllease you can be sure whatever Exxon Mobil says regarding their motive you can take with a grain of salt - certainly that they're concedeing or happy about that alternative fuel sources are going to cut oil demand by 2030? compared to what today's demand for oil or how much more the demand would have grown to without alternative fuel sources...
..so instead they say oil demand will wane by 2030? How's that going to happen with a growing India and China already using more oil than we do?
..because India and China are investing a lot more than we are in alternatives to oil. Exxon is promoting investment in alternatives too.
I don't trust the oil companies, but they're a lot more pragmatic than our government is about foreign oil supplies - and financial investment.
When respected geologists were writing books the fact that Gulf states like Saudi Arabia and the UAE had a lot less oil than they claimed to have, our government ignored them. The oil companies paid some attention, because they had a lot more to lose.
Saudi Arabia has even offered to help the oil companies build refineries here, and the oil companies still think it's a losing deal.