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Arctic Could Hold Vast Bounty
Brazil Improving Energy Efficiency

Arctic Could Hold Vast Bounty
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The region north of the Arctic Circle might contain 36 billion more barrels of oil equivalent than previously thought.
The Arctic may hold 8.5 percent more of the world’s undiscovered oil and gas resources than previously estimated, according to a researcher.
The region north of the Arctic Circle might contain 36 billion more barrels of oil equivalent than previously thought, or roughly twice the known reserves of Norway, said Steven Sawhill, a senior research fellow at Oslo-based Research Company Ocean Futures, at a conference today, Bloomberg reported.
“Estimates of undiscovered resources are increasing and will probably continue to increase,’’ he said.
Oil and gas producers such as StatoilHydro ASA are looking to the largely unexplored Arctic waters for petroleum deposits as existing production dries up. Rising demand for the fuel and surging oil prices have spurred exploration in harsher climates.
The region holds about 15 percent of the world’s known oil and gas reserves, mostly in Russia, and is currently estimated to contain about 24 percent of undiscovered resources.
Sawhill’s figures, based on assessments made by the US Geological Survey since it published estimates in 2000, indicate the Arctic may contain undiscovered petroleum resources of 459 billion barrels of oil equivalent, compared with an adjusted previous projection of 423 billion barrels. The USGS will publish reassessments of its 2000 data this year, Sawhill said.
“In the opinion of many Norwegian officials, the European Arctic could become Europe’s most important petroleum province in the years ahead,’’ Sawhill said. “Their optimism is based on the fact that considerable oil and gas reserves have already been found.’’
Arctic ice is melting, making the area more accessible to the petroleum industry. The industry still faces ecological challenges such as safeguarding the Arctic’s marine life. Parts of the Arctic are off limits to protect the environment, and disputes between countries over who has rights to what areas are also limiting energy exploration in the area.
The amount of petroleum resources in disputed areas of the Barents Sea between Norway and Russia varies from about 48 billion barrels of oil equivalent according to the Russian Energy Ministry to about 12 billion according to the US Energy Information Administration, Sawhill said. Norway hasn’t published estimates.
StatoilHydro ASA, Norway’s largest oil and gas producer, started up its Arctic Snohvit liquefied natural gas plant, Europe’s first offshore Arctic field development, in August. It is currently the only producing field in the Barents Sea.
“It’s a long time since we’ve seen such intensive exploration in the Barents Sea,’’ according to StatoilHydro spokesman Ola Morten Aanestad. The region hasn’t seen this much ongoing drilling activity since the 1980s, he said.
The state-controlled company said last year it plans to drill at least six to eight exploration wells in the Barents Sea. StatoilHydro has drilled three wells in the area so far and the remainder will probably be drilled by the end of next year, spokesman Gisle Johanson said.

Brazil Improving Energy Efficiency
The Arctic may hold 8.5 percent more of the world’s undiscovered oil and gas resources than previously estimated, according to a researcher.
The region north of the Arctic Circle might contain 36 billion more barrels of oil equivalent than previously thought, or roughly twice the known reserves of Norway, said Steven Sawhill, a senior research fellow at Oslo-based Research Company Ocean Futures, at a conference today, Bloomberg reported.
“Estimates of undiscovered resources are increasing and will probably continue to increase,’’ he said.
Oil and gas producers such as StatoilHydro ASA are looking to the largely unexplored Arctic waters for petroleum deposits as existing production dries up. Rising demand for the fuel and surging oil prices have spurred exploration in harsher climates.
The region holds about 15 percent of the world’s known oil and gas reserves, mostly in Russia, and is currently estimated to contain about 24 percent of undiscovered resources.
Sawhill’s figures, based on assessments made by the US Geological Survey since it published estimates in 2000, indicate the Arctic may contain undiscovered petroleum resources of 459 billion barrels of oil equivalent, compared with an adjusted previous projection of 423 billion barrels. The USGS will publish reassessments of its 2000 data this year, Sawhill said.
“In the opinion of many Norwegian officials, the European Arctic could become Europe’s most important petroleum province in the years ahead,’’ Sawhill said. “Their optimism is based on the fact that considerable oil and gas reserves have already been found.’’
Arctic ice is melting, making the area more accessible to the petroleum industry. The industry still faces ecological challenges such as safeguarding the Arctic’s marine life. Parts of the Arctic are off limits to protect the environment, and disputes between countries over who has rights to what areas are also limiting energy exploration in the area.
The amount of petroleum resources in disputed areas of the Barents Sea between Norway and Russia varies from about 48 billion barrels of oil equivalent according to the Russian Energy Ministry to about 12 billion according to the US Energy Information Administration, Sawhill said. Norway hasn’t published estimates.
StatoilHydro ASA, Norway’s largest oil and gas producer, started up its Arctic Snohvit liquefied natural gas plant, Europe’s first offshore Arctic field development, in August. It is currently the only producing field in the Barents Sea.
“It’s a long time since we’ve seen such intensive exploration in the Barents Sea,’’ according to StatoilHydro spokesman Ola Morten Aanestad. The region hasn’t seen this much ongoing drilling activity since the 1980s, he said.
The state-controlled company said last year it plans to drill at least six to eight exploration wells in the Barents Sea. StatoilHydro has drilled three wells in the area so far and the remainder will probably be drilled by the end of next year, spokesman Gisle Johanson said.

LNG Terminal
Japanese gas distributor Hokkaido Gas Co said it plans to spend 40 billion yen to build a liquefied natural gas import terminal in northern Japan to meet growing demand.

EnergyCol2
EU Biofuel Policy Harmful
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On April 15 an advisory panel to the European Environment Agency issued an extraordinary scientific opinion: The European Union should suspend its goal of having 10 percent of transportation fuel made from biofuel by 2020.
According to IHT, the European Union’s biofuel targets were increased and extended from 5.75 percent by 2010 to 10 percent by 2020 just last year. Still, Europe’s well-meaning rush to biofuels, the scientists concluded, had produced a slew of harmful ripple effects--from deforestation in Southeast Asia to higher prices for grains.
In a recommendation released last weekend, the 20-member panel, made up of some of Europe’s most distinguished climate scientists, called the 10 percent target “overambitious“ and an ’experiment’ whose “unintended effects are difficult to predict and difficult to control.“
“The idea was that we felt we needed to slow down, to analyze the issue carefully and then come back at the problem,“ Laszlo Somlyody, the panel’s chairman and a professor at the Budapest University of Technology and Economics, said in a telephone interview.
He said that part of the problem was that when it set the targets, the European Union was trying desperately to solve the problem of rising transportation emissions “in isolation,“ without adequately studying the effects of other sectors like land use and food supply.
“The starting point was correct: I’m happy that the European Union took the lead in cutting greenhouse gasses and we need to control traffic emissions,“ Somlyody said. “But the basic problem is it thought of transport alone, without considering all these other effects. And we don’t understand those very well yet.“
The panel’s advice is not binding and it is not clear whether the European Commission will follow the recommendation.
It has become increasingly clear that the global pursuit of biofuels--encouraged by a rash of targets and subsides in both Europe and the United States--has not produced the desired effect.

More Emissions
Investigations have shown, for example, rain forests and peat swamp are being cleared to make way for biofuel plantations, a process that produces more emissions than the biofuels can save.
Meanwhile, land needed to produce food for people to eat is planted with more profitable biofuel crops, and water is diverted from the drinking supply.
In Europe and the United States, food prices for items like pizza and bread have increased significantly as grain stores shrink and wheat prices rise.
The price of wheat and rice are double those of a year ago, and corn is a third higher, the Food and Agriculture Organization said this week.
“Food price inflation hits the poor hardest, as the share of food in their total expenditures is much higher than that of wealthier populations,“ said Henri Josserand of the Food and Agriculture Organization.
Biofuels are not, of course, the only reason for high food prices. Fuel to transport food is more expensive with oil more than $100 a barrel. There have been unexpected droughts this year as well.
But the rush to meet biofuels targets has put our “need“ to drive a car to the mall in direct competition with the need to eat in some of the poorest countries in the world.
A global analysis performed by forestry experts at the Australian International Institute for Applied Systems Analysis, a scientific study group, found that biofuels were “in conflict with the reduction of deforestation“ and also had negative effects on farming intensity and food security.

Ambiguous Effect
It also concluded that the rush to make biofuels from crops like corn, soy and rapeseed did not do much to reduce global greenhouse gasses anyway, producing an “ambiguous effect on greenhouse gas emissions.“ This is partly because of land use changes like the clearing of forests and partly because the process of converting plants into fuel takes a lot of energy itself.
The European Union started promoting biofuels for use in transportation in 2003 as emissions from road transportation had been growing rapidly.
It required that 2 percent of transport fuel come from biofuel by 2005 and 5.75 percent by 2010. The first goal was not met and the 2010 goal is expected to be missed as well. Even so, the goal was raised to 10 percent by 2020, raising the pressure for countries to comply.
Should we conclude that all biofuels are bad?
No. But motivated by the obvious problems now emerging, scientists have begun to take a harder look at their benefits.
For example, the European Environment Agency advisory panel suggests that the best use of plant biomass is not for transport fuel but to heat homes and generate electricity.
To be useful for vehicles, plant matter must be distilled to a fuel and often transported long distances. To heat a home, it can often be used raw or with minimal processing, and moved just a short distance away.
Likewise, the ambitious 10 percent target has led to destruction of vital natural resources, the European Environment Agency recommendation said, “increasing pressures on soil, water and biodiversity“ in Europe and elsewhere.
“We felt we need to understand more about biofuels and to integrate these various goals before just moving ahead,“ said Somlyody, the panel’s chairman.