Get Ready For More Congressional Hearings

Last week's socialist circus performances by Schmuck Schumer (Moron-NY) and Kameraden Madame Maxine Waters (Moonbat-CA) may well be soon eclipsed after they become aware of this. Bring it on.

Energy giants smell windfall from sulphur

A Kazakh worker pours liquid sulphur at the Tengizchevroil refinery. Large quantities of crude oil is produced at Chevron’s Tengiz project
An ugly waste product of oil refining has been transformed into a golden windfall for energy companies as demand for fertilisers drives the price of sulphur to unprecedented levels.

For decades oil refiners have struggled to shift stockpiles of the yellow chemical, which is used to make sulphuric acid, essential in the manufacture of fertilisers. Food shortages and higher grain prices are boosting demand for fertilisers, and in only a year the price of sulphur has risen more than tenfold from $50 a tonne to $500 a tonne, according to ICIS, the chemicals-pricing service.

The extraordinary surge in the price of sulphur is expected to generate windfall profits for some oil companies, notably Royal Dutch Shell and Chevron, as well as Gulf oil producers, such as Saudi Aramco and Adnoc, the Abu Dhabi national oil company.

“Shell is one of the most-efficient producers of sulphur,” Barry Clarke, a sulphur market analyst for Pentasul, said. Shell produces about 3.5 million tonnes of sulphur, much of it from its Canadian oil sands business, and its cost, Mr Clarke reckons, is merely the rail freight cost of getting the sulphur to a port, about $25 a tonne.

Mr Clarke agrees that sulphur, once a burden, could earn the oil industry billions this year. “It’s going to show up in the earnings of companies,” he said.

Congressional hearings to be announced in 5 ... 4 ... 3 ...

The price is expected to rise further with spot cargoes changing hands for as much as $700 a tonne. Demand for metals is also keeping sulphur bubbling, as sulphuric acid is used in the mining industry to leech metal from ore.

So large was the sulphur surplus a decade ago that mountains of the chemical were being formed, notably in Kazakhstan, where high-sulphur “sour” crude oil is produced in large quantities at Chevron’s Tengiz project. A spokesman for Chevron confirmed that the stockpiles were beginning to erode as the company was finding demand for more than the annual output from the Tengiz field.

“Last year we sold a record 2 million tonnes,” he said. “We sold 126 per cent of production.”

Chevron wants to raise output to 3 million tonnes, further levelling its stockpiles, and Shell has recently developed a separate global business, based in Canada, to market its sulphur output.

Patrick Romeo, general manager of sulphur marketing for Shell, said that the market was undersupplied. The reason for the extraordinary price surge, he said, is that sulphur producers cannot respond to price increases and produce more. Sulphur output is purely a function of the amount of “sour” crude oil and sour gas that is processed by refineries. Mr Romeo said: “There is not much you can do about producing more sulphur. We are trying our best to put everything we have in stock into the market.”

The cost of sulphur and phosphates, another essential fertiliser ingredient, is sparking protests from politicians in developing countries, such as India, where the Government subsidises fertiliser to keep costs down for poor farmers.J.S. Sarma, secretary to the government department of fertilisers in India, said that prices were abnormally high and not justified. “I would not be honest if I said that it is not putting a strain on [India’s] financial resources,” he said.

The estimated cost to the Indian Government of the fertiliser subsidy is $22 billion (£11 billion), more than double last year’s figure.

According to Pentasul, the world produces about 47 million tonnes of sulphur annually, but the world’s ravenous demand for food is telling the sulphur market that 49 million tonnes is needed. Meanwhile, the opening of new mining projects adds further pressure on demand, creating huge price spikes.

Shell is confident that the price surge is temporary, and the company is developing products, such as sulphur-based concrete, anticipating a future surplus. It said: “There will be more sulphur in the market in the longer term and it will be overproduced as the world uses more unconventional oils, such as oil sands. Unconventional oil means more sulphur.”

Desperate to find a link to global warming climate change further perpetuate his hoax, al-Gore was unavailable for comment.

Via TimesOnline

Moonbats Blowing in the Wind

Shell Oil is withdrawing from a wind power project in the UK and the moonbats are angry. Additionally, by running this article the BBC editors once again document their own stupidity about economics.

A plan to build the world's largest wind farm in the Thames Estuary looks uncertain after Shell said it wants to pull out of the project.

Shell wants to sell its stake in the London Array scheme and said it planned to focus on wind power in the US.

It said that US government incentives offered Shell "competitive returns".

Of course the environuts are furious.

Environmental group Friends of the Earth said that Shell's decision to pull out left "a key clean energy project high and dry".

"Shell announced a 12% profit rise to £3.92bn," the group's energy campaigner Nick Rau said.

"It should be investing those profits in renewable energy projects, not focusing its efforts on making money from sucking fossil fuels out of the ground and contributing to climate change."

Here are a few clues for Rau and the BBC editors.

* Shell has no obligation to you or anybody else but their stockholders. Shell's obligation to the stockholders is to maximize the ROR on the stock, end of story. If you put down Das Kapital for a few minutes and tried taking an Econ 101 class you might have a chance of grasping that reality.

* Neither Mr. Rau or the BBC editors are on Shell's Board of Directors, so what you think they "should be investing" in is meaningless.

* If this wind farm is such a good idea, I suggest that Mr. Rau and the BBC should feel free to go take out a bunch of loans, liquidate all your assets and put every dime you have into this project. I won't stop you. But you have no business telling anybody else what they should be doing with their money.

So what is the downside of the windfarm project?

The chief executive of E.On UK, Paul Golby, said he was disappointed by Shell's decision.

"While we remain committed to the scheme, Shell has introduced a new element of risk into the project which will need to be assessed."

"The current economics of the project are marginal at best - with rising steel prices, bottlenecks in turbine supply and competition from the rest of the world all moving against us."

So, there is a lot of avoidable risk to this project such as marginal economics, competition, and rising costs. Shell did not introduce these risks to the project. They existed already and Shell just decided (correctly, in my opinion) to avoid them.

So if this is such a great investment, I invite the BBC to put all their assets into it immediately.

Otherwise, mind your own business.