Shale Gas: If this is such a good deal why are you selling it...

Jim Hansen That is the question many buyers of shale gas assets should have been asking themselves over the last few months. This week’s news that shale gas high roller Range Resource was selling its Barnett shale properties reinforced our view that there is major trouble brewing in the shale gas business. Upstreamonline reported that “…Range Resources Corporation said it will sell almost all of its Barnett shale properties to a private company for $900 million…” Then of course there is the number one shale gas play cheerleader of them all, Chesapeake Energy. Just last week they...

Peak Oil & Energy Efficiency In The News

A couple of interesting items in the news yesterday on topics dear to alt energy investors' hearts. Firstly, a new report (PDF document) by CIBC World Markets arguing that globalization could be reversed by high oil prices. The folks at CIBC WM contend that growing shipping costs driven by higher prices for transportation fuels could erase the Asian labor cost advantage, driving a renaissance in North America's manufacturing sector. What's the main culprit? Peak Oil, albeit not called directly Peak Oil. I watched an interview with Jeff Rubin, CIBC WM's Chief Economist, on Bloomberg's In Focus yesterday, and...
To Renewable Diesel

Conversions To Renewable Diesel

by Helena Tavares Kennedy The seasons are changing in many parts of the world right now, but what really is changing this autumn is how the world is looking at renewable diesel. Phillips 66 and REG’s announcement about a new renewable diesel plant on the U.S. West Coast planned for 2021 comes after a notable increase in refineries that are being converted and changed over to renewable diesel. Change is good, especially in this case. As Bob Dylan sang, “For the loser now, Will be later to win, For the times they are a-changin’.” And who knew he was singing about the RFS...

Oil’s Sesquicentennial; the Dream Becomes Nightmare

John Petersen On August 27th, we'll celebrate the 150th anniversary of Colonel Edwin Drake's completion of the world's first successful oil well near Titusville, Pennsylvania. That discovery and the many that followed planted the seeds of an industrial, economic and cultural revolution that transformed America from an agrarian backwater into a global superpower. For the next 114 years, oil was cheap, plentiful and the solid bedrock of the American Dream. Since the early '70s, however, the dream has gradually become a nightmare as domestic and global oil production began an irreversible decline. My first graph comes...

Cleantech Economics 101: Higher Fossil Fuel Prices; More Cleantech

David Gold With all the complexities of cleantech policy and technologies, there is only one simple thing needed for an explosion of competitive clean technologies – increased price of fossil fuels. The amount of R&D expenditures that will need to be invested in clean technology in order for it to hurdle the bar into competitiveness is much greater with low fossil fuel prices. And, the lower those prices, the less appetite the private sector has for making such investments. This leaves a much-increased burden on the back of government through grants and subsidies– a back that is...

What Will the Oil Spill Do For Oil Sands Stocks?

Bill Paul Will shares of the oil companies that are major players in Canada’s tar sands region rise or fall? Logically, shares should rise in the wake of the deepwater drilling moratorium ordered by President Obama following the BP (BP) oil spill, as Wall Street begins to reflect on the fact that Alberta’s tar sands region is the second biggest crude-oil deposit in the world. Even before the spill, a report from IHS CERA had concluded that Canadian tar sands would be the single biggest source of US crude imports in 2010. Just as logically, however, shares should...

The Best Peak Oil Investments: Why Invest for Peak Oil?

...and Why Not Invest in Oil Companies? Tom Konrad CFA The purpose of this series on peak oil investments has been to highlight companies outside the oil sector that are likely to benefit from increasing oil prices.  This article explains why we should expect oil prices to rise. What is Peak Oil? There are many definitions for peak oil.  In its most basic form, Peak Oil is the moment of highest production.  World oil supplies are finite, and so we cannot continue to produce oil in increasing quantities forever.  It's a mathematical certainty that at...

The Best Peak Oil Investments: Index

Tom Konrad CFA Part Subject / Description Stocks mentioned I Biofuels Overview WM II Hydrogen Vehicles and Vehicle Electrification III Natural Gas Vehicles WPRT, CLNE, and one I missed: FSYS IV Synthetic fuels: Gas-to-Liquids, Coal-to-Liquids, and Biomass-to-Liquids SSL, SYNM, RTK V Biofuel from Algae GSPI.PK, OOIL.OB, PALG.OB, PSUD.PK VI Barriers to Alternative Fuels ...

The Peak Coal Portfolio

Last week, we alerted you to a report from Germany's Energy Watch Group called “Coal: Resources and Future Production,��? which predicts peak coal by 2025.  Readers of AltEnergyStocks are doubtless familiar with peak oil, the inevitable fact that as we consume a finite resource (oil reserves) at some point the rate of that consumption must peak, and taper off.  Serious arguments about peak oil center around "when" oil production (and consumption) will peak, not "if."   The same it true for other finite natural resources, such as natural gas, uranium, and even coal.  The difference with coal is the received...

The Best Peak Oil Investments, Part VIII: Alternative Fuel Report Card

Tom Konrad CFA There are two types of solution to the liquid fuels scarcity caused by stagnating (and eventually falling) oil supplies combined with growing demand in emerging economies.  The most obvious is to find a substitute to replace oil.  Each potential substitute has barriers to its use which stand in the way of it from becoming a complete substitute for petroleum based fuel.  Understanding those barriers also leads us to the investment opportunities that arise from these substitutes.  In the last two articles of this series, I looked at barriers to adoption for alternative...

What the L.A. Methane Leak Tells Us About Investing

by Garvin Jabusch Sempra Energy’s leaking gas field in Porter Ranch, CA, near Los Angeles, has been making national headlines recently, as it now enters its third month of being the largest methane leak in U.S. history. How big is that? The LA Times says that, “by early January, state air quality regulators estimate, the leak had released more than 77 million kilograms of methane, the environmental equivalent of putting 1.9 million metric tons of carbon dioxide in the air.” 1.9 million metric tons of carbon dioxide and counting. In addition, methane isn’t only a powerful greenhouse gas, it can...

Divesting: Last One Out Loses

Tom Konrad CFA Anew report written by Nathaniel Bullard at Bloomberg New Energy Finance highlights the difficulties large institutional investors would have divesting from fossil fuels. What it does not specifically discuss is that these difficulties could lead to large financial losses for investors who see the difficulty of divesting as a reason to delay. Just as we can't easily fill up our cars with solar power instead of gasoline, the report points out that there is no asset class that can directly substitute for oil and gas in large institutional portfolios. A person...

The Best Peak Oil Investments, Part VI: Barriers to Substitution

Tom Konrad CFA There are two types of solution to the liquid fuels scarcity caused by stagnating (and eventually falling) oil supplies combined with growing demand in emerging economies.  The most obvious is to find a substitute to replace oil.  These substitute have barriers to their use as a replacment petroleum based fuel.  Understanding those barriers also leads us to the investment opportunities that arise from these substitutes.  As I wrote the first five parts of this series, looking into potential substitutes for gasoline and diesel, it was clear that many potential substitutes would need...

Jim Rogers: What Peak Oil Will Do for Cotton

The most recent issue of Fortune has an excellent interview with Jim Rogers, of Investment Biker and Adventure Capitalist fame, as well as an excerpt from is new book, A Bull in China.  Jim saw the start of the current commodities supercycle early (peak oil is just one driving force for this cycle), but it still has a long way to run, in my opinion, as well as Jim's.   Almost everything has some dependence on energy prices, because of either the embodied energy, or because if the embodied energy of substitutes.   As Jim says in the interview, ...

Do You Need To Invest In Oil To Benefit From Expensive Oil?

Two months ago, Tom told us how he'd dipped a toe into the black stuff (i.e. bought the OIL etf) on grounds that current supply destruction related to the depressed price of crude oil would eventually lead to the same kind of supply-demand crunch that led oil to spike during the 2004 to mid-2008 period. If you need evidence that the current price of crude is wreaking havoc in the world of oil & gas exploration, look no further than Alberta and its oil sands. The oil sands contain the second largest oil reserves in the world after...

Shale Gas: Promises, Promises, Promises

Tom Konrad CFA Dr. Arthur Berman, of Labyrinth Consulting Services has taken a hard look at actual production data from  Barnett Shale in 2007.  What he found should worry anyone expecting this abundant, relatively clean, domestic energy resource to be cheap.  It should especially worry investors in shale gas companies, such as CHK, DVN, and XTO. In a panel entitled "Natural Gas Game Changers?" at the 2009 International Peak Oil Conference, Dr. Breman presented some results from his research into the actual production from the nearly 2000 horizontal gas wells drilled in the Barnett Shale in 2007.  The Oil...