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Author Topic: Fossil Fuel Profits Getting Eaten Alive by Renewable Energy!  (Read 11001 times)

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    • Renwable Revolution
Faced by Falling Oil Prices and Plunging Profits, Big Oil Invests in Renewables

Kieran Cooke, Climate News Network | May 22, 2016 11:09 am

The big oil companies’ on-off affair with renewable energies seems to be back on track.  ;)

Recent reports say Shell, the Anglo-Dutch oil conglomerate, is to invest $1.7 billion in forming a new company division aimed specifically at developing renewable energy and low carbon power.   

As a recent report pointed out, the oil companies have failed to adapt to an increasingly fragmented global energy system. Buffeted by low oil prices and tightening climate change-related regulations, they have seen a sharp drop in their financial fortunes.

This follows on the heels of an announcement by the  French oil company Total, another of the oil giants, that it is stepping up its investments in clean energy, spending more than $1 bn buying Saft, a major battery manufacturer. Total has also purchased  a majority share in SunPower,  a leading solar concern.

Even ExxonMobil, for long an organization which cast doubt on the whole science of global warming, has recently announced plans to investigate fuel cell technology in order to build carbon capture and storage facilities and eliminate greenhouse gas emissions from power installations. 

Low Investments

On the face of it, this is all good news in the battle against climate change. Emissions from fossils fuels, particularly from oil and coal burning, are a major driver of global warming.

Yet as a proportion of their overall spending, the oil giants’ investments in renewables are still very low, and are dwarfed by their spending on fossil fuel-related activities.

Also, in the past, the oil majors have made much-publicized announcements about alternative energy investments, only to later quietly withdraw their support.   

As a recent report pointed out, the oil companies have failed to adapt to an increasingly fragmented global energy system. Buffeted by low oil prices and tightening climate change-related regulations, they have seen a sharp drop in their financial fortunes.

BP has been worst hit, reporting a loss of $6.5 billion in 2015 compared to a profit of $3.8bn the previous year.

Market Share Lost

Operating in an oil market which is increasingly chaotic and unstructured is not easy. The major oil companies—once all-powerful in the energy market—have over the years lost production and market share to state-owned conglomerates, most of them gathered under the Organisation of Petroleum Exporting Countries (OPEC) umbrella.

In recent years OPEC itself has begun to fracture, and production level agreements have broken down.

Member countries Saudi Arabia and Iran are bitter enemies. Libya is in a state of near civil war. There is political chaos in Venezuela. Rebel groups are attacking oil installations in Nigeria.

Meanwhile non-OPEC members—the U.S. and Canada—have been adding to a global oil glut—caused primarily by a slowing world economy—by pumping out millions of barrels of oil from shale deposits and by fracking.

Experts say that in order to survive, the oil majors have to invest in new technologies, including renewables. Once again, the companies are taking tentative steps along that path, but it might be too little, too late for them to survive. 

Kieran Cooke, a founding editor of Climate News Network, is a former foreign correspondent for the BBC and Financial Times. He now focuses on environmental issues


Agelbert NOTE: The ONLY reason the oil majors lie about "plans" to go into Renewable Energy and/or try to buy the Renewable Energy competition, like French Oil Pig Total is doing with the over one billion dollar purchase of Saft, a major battery manufacturer, is to suppress Renewable Energy.

The Fossil fuel Industry does not like losing energy market share to Renewables, particularly those Renewables that destroy demand for gasoline and diesel (i.e. battery powered TRANSPORTATION).

What's the big deal about big oil transportation market worries versus all the other uses fossil fuels are used for in our civilization? ???

The simple answer is that, as you all know, the products of the oil and gas majors have to be refined in, of course, refineries. That is a complex, energy hogging process that the fossil fuelers do not like to talk about. It produces a LOT of pollution, above and beyond the pollution from flaring (and other causes) at ocean and land oil and gas rig fossil fuel extraction sites.

I have, in the past, mentioned how CH4, otherwise known as methane, can be obtained from animal feces Methane Harvesters without ANY flaring or ANY aquifer polluting side effects that are sine qua non to Fracking. Fracked CH4 gas is NOT "natural" gas. Methane harvester CH4 IS RENEWABLE ENERGY, POLLUTION FREE, NATURAL GAS. The ERoEI of CH4 from Methane Harvesters is FAR MORE than that of CH4 from Fracking. But today I wish to concentrate on crude oil, not Fracked oil and gas.

In an oil refinery, the crude oil is processed to produce certain fractions by percentage, that are fairly rigid, from a given amount of crude oil. Because some of the crude is volatized during the distillation, heating, cracking and isomerization stages, the percentages add up to a little more than 100%.

Before you become too bored, the main point here is that about 42% of every single barrel of crude oil MUST yield gasoline raw material. NO OTHER FRACTION comes to even half the gasoline raw material fraction.

I say "raw material" because that 42% will NOT properly run your car like biofuel plant based ethanol can with ZERO added energy inputs and processing.

The raw gasoline must be catalytically reformed and isomerized to make the short hydrocarbon chains into long ones to increase the octane (avoid engine knocking - further processing is required - adding some chemicals that replaced lead, though lead is STILL added for aviation gasoline, ALL through a highly energy intensive process that bought and paid for Charles Hall does not want to include in his energy math.  ;)).

Finally, gasoline has to be "sweetened", something totally unnecessary for biofuel based ethanol (the fossil fuel industry produces about 5% of world ethanol output - the ERoEI of biofuel ethanol is FAR higher than the ERoEI of fossil fuel based ethanol - regardless of the propaganda claiming they are the same). "Sweetening" is the process of making it smell less offensive (and be less polluting when it is burned) by stripping the gasoline of a large part of its sulfur content. "Sweetening" ALSO uses a lot of energy. 

But our dear loyal servants in the fossil fuel industry, have managed to make vast fortunes and kept the CLEAN energy competition at bay with "subsidies" their bought and paid for politicians continually baby them with.

Along comes solar power and batteries and starts to eat fossil fuel lunch in heating oil (this is a smaller distillate fraction than gasoline but it gets their attention).
THEN battery technology begins to take off and it REALLY gets their attention. That is because EV's run on batteries that can get all their energy from solar power. It's a combination that threatens OVER 42% of the downstream product profit.

When 42% of the fossil fuel industry refinery product goes from being a lucrative contribution to profits to being a loss inducing, and added polluting cost because you have to burn it at the refinery, the entire business model of the crude oil extracting fossil fuel industry is in jeopardy.   

So, they try to suppress, strangle, buy, bop, etc. the competition while continuing to bullshit us 24/7 about how they are just trying to provide "cheap" energy. 

SO, every time somebody tells you about how "unimportant" transportation fuels are to the big oil bottom line and how we "need" oil for a "lot of other stuff" that makes oil "necessary" for our civilization, I suggest you quote the following to them:


Refinery gases (including liquefied gas) 6.2%
Gasoline 42.4%
Jet fuel 6.9%
Burning (heating) oils, including kerosene 23%
Naptha and Petrochemical FEEDSTOCKS 5.5%
Lubricants and waxes 1.4%
Asphalt 3.1%
Miscellaneous 0.9%

Residuals (heavy oils) 11.6%

These percentages are by volume and total more than 100 per cent, because many of the products have a lower density than the original feedstock.

SOURCE: The New Illustrated Science and Invention Encyclopedia: Volume 13
Published by H. S. STUTTMAN INC.

A mere 5.5%, on the average. is for plastics, pesticides, fertilizers, pharmaceuticals, ETCETERA. So you can tell the propagandists claiming we "need" oil for "a lot of other stuff" that they are either ignorant of the facts, or complicit in the mendacious and disingenuous propaganda.

The fossil fuel industry is DEAD if they cannot sell us GASOLINE and HEATING OIL.
Now you KNOW why they have been fighting solar power and want to suppress battery technology.

We-the-people are HURTING the fossil fuel industry bottom line. 

The average U.S. household is expected to spend about $550 less on gasoline in 2015 compared with 2014, as annual motor fuel expenditures are on track to fall to their lowest level in 11 years.

THAT is because we are DRIVING LESS , not just because the cost of fuel has gone own. Added to the demand destruction is the steady increase of EVs.

But if you don't have the money to buy one, just do what I do. For over a decade I have averaged less than 2000 miles a YEAR in my 1997 Camry. That's about 110 gallons of gasoline a YEAR.

The average household consumes about 1,011 gallons per year (and that is over 15% DOWN from previous years  ;D). The math challenged fossil fuel industry propagandist (MKing) repeatedly calls me a "gas guzzler" even though my household consumes 90% LESS  gasoline than the average American household.  ::)

If every family did that, the fossil fuel industry would, despite all their subsidy swag, DIE. Do your part. Use NO gasoline.  If that is not possible, then combine errands and use a LOT LESS gasoline. By doing that you will help the fossil fuel industry go the way of the dodo bird. The sooner, the better.

« Last Edit: June 07, 2021, 04:00:46 pm by AGelbert »
Rob not the poor, because he is poor: neither oppress the afflicted in the gate:
For the Lord will plead their cause, and spoil the soul of those that spoiled them. Pr. 22:22-23


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