Pension funds invest in big bad oil

[wayneflorida 0]

From article;
"The study says that between 2005 and 2009, oil and gas investments represented 4.8 percent of total state government pension fund assets, yet produced 12.2 percent of the investment gains earned by those plans. "

This is Michigan but is probably typical across the US.

Big oil might not be all bad.

http://www.michigancapitolconfidential.com/14966

[Andy9o8 3]

Untouchable corporate rapists, if they're publicly-held stock companies, are generally pretty good investments. It is what it is.

[billvon 3,132]

>Big oil might not be all bad.

As investments go, oil futures are a great deal. We're running out, and high demand + low supply equals high prices in the future.

[dmcoco84 5]

Quote

We're running out,

How so?

[dmcoco84 5]

Apple has a profit margin of ~42%

Oil companies have a profit margin of just under 8%


Is it time for a Windfall Apple Tax?

[billvon 3,132]

>How so?

We're using it many orders of magnitude faster than it is being created. That means that we will eventually run out of usable oil. Before that happens we will run out of _cheap_ oil, which is what's happening now - and which is why oil prices are rising. Hence the value of oil futures.

[dmcoco84 5]

We have enough oil, between the gulf/Alaska/offshore to last over 200 years alone.

We are the Saudi Arabia of Shale;
Shale to Oil can be produced at $55 a barrel. Our Air force is already doing it.


We do not need to import even 1oz of oil if we utilize our own resources.


Again... how so?

[david3 0]

Quote

We have enough oil, between the gulf/Alaska/offshore to last over 200 years alone.

We are the Saudi Arabia of Shale;
Shale to Oil can be produced at $55 a barrel. Our Air force is already doing it.


We do not need to import even 1oz of oil if we utilize our own resources.


Again... how so?

So we aren't using it faster than it is being created?

[dmcoco84 5]

"We do not need to import even 1oz of oil if we utilize our own resources."

[kelpdiver 2]

Quote

>How so?

We're using it many orders of magnitude faster than it is being created. That means that we will eventually run out of usable oil. Before that happens we will run out of _cheap_ oil, which is what's happening now - and which is why oil prices are rising. Hence the value of oil futures.

but the value of a stock is based, more or less, on the future dividend stream. If Exxon runs out of oil, no more revenue. Makes for a challenging investment choice - when do you ditch it? When BP tried to angle for next gen energy, that seemed like a better play. Unfortunately, the company is run by incompetents.

Philip Morris is the best returning stock over the past several decades (presuming dividend reinvestment), and still has been paying out 4-7% in recent years. But at some point (?), enough people will stop smoking that it no longer delivers. Probably sooner than 5 decades.

[billvon 3,132]

>We have enough oil, between the gulf/Alaska/offshore to last over
>200 years alone.

If we make every area in the US open to drilling, we have ~21 billion barrels of oil that are economically recoverable. We use about 22 million barrels a day. That means if we could pump every drop from our own wells, we'd run out in 950 days, or 2.6 years.

>Shale to Oil can be produced at $55 a barrel. Our Air force is already doing it.

Sure. But then you have to process the kerogen to get the oil out, which requires lots of energy input. That gives you shale oil, which can be burned but is pretty nasty stuff; it requires a lot more processing than oil to crack it to lighter hydrocarbons. The process is still net positive, but it makes the whole well-to-gasoline cycle WAY more expensive. (i.e. that $55 a barrel of shale oil is not nearly equivalent to an $80 barrel of light sweet crude - which is why people are willing to pay for light sweet crude.)

But in general yes, there are many other alternatives to oil. Shale cracking/shale oil is one. Natural gas is another. Biofuels are a third. But in all cases we will shortly be running out of oil, the stuff that we've been relying on for the past 100 years or so to power our industry. Which, again, is why it is a good investment.

[dmcoco84 5]

Quote

That means if we could pump every drop from our own wells, we'd run out in 950 days, or 2.6 years.

That is utterly ridiculous.



Our Air force, right now, produces Shale at $55 a barrel. Off the top of my head, I can't remember the time period, (was within the last 25 years) we were prepping to start Shale. OPEC dropped the price of oil to $8 a gallon.

Makes no sense to use shale at that price...

Even at $80 (so you say) every dime would stay in this country... we would get to those "renewable sources" faster. They Are Not Ready Now ... Not Even Close.


And you have said nothing about the value of the dollar... quite a big impact.



And the Chevy Volt is a POS.

Natural Gas only makes sense in transportation for trucking.

BioFuels... we are burning up our food supply (corn), and we will be HAAAAAAAATED around the world, even more, very soon.

[billvon 3,132]

>Our Air force, right now, produces Shale at $55 a barrel.

Right. And if you have a shale oil burning vehicle, that's great. If your car burns gasoline you're sorta out of luck, because shale oil is a lot harder to turn into gasoline than light sweet crude is.

However, modify your car to burn something that's easier to refine from kerogen/shale oil, and you might just have a good solution. Most diesels will work on a pretty good range of fuels, and if you can fractionate out the lighter parts of shale oil, and keep it heated, then you could likely run your car on it pretty easily.

>Even at $80 (so you say) every dime would stay in this country... we
>would get to those "renewable sources" faster.

So by reducing the need for them we'd get to them faster? Hmm. Interesting take on economics.

>They Are Not Ready Now ... Not Even Close.

I generate all my power from solar. There are dozens of completely electric vehicles in the garage at my place of work. You can walk into Nissan today and order an electric car.

I'd say that counts as "close to ready."

>Natural Gas only makes sense in transportation for trucking.

And buses, and ships, and cars. Again, you can, today, walk into a Honda dealership and order a natural gas Civic.

>BioFuels... we are burning up our food supply (corn)

Was thinking more of farm waste (stalks etc) and garbage. We generate a fair amount of power here from biogas from landfills, and more and more farmers are using biogas to run their farms.

>and we will be HAAAAAAAATED around the world, even more, very soon.

Think there will be a violently negative reaction to the rising price of pig shit due to all those farmers using it up in their digesters?

[CanuckInUSA 0]

The world is running out of easy to access light sweet crude. But the world is not running out of oil. There will be oil for centuries to come. It will be more expensive to access and refine so naturally it will not be cheap. But investing in oil companies is a good thing for pension funds to do.

However a funny thing happened along the way. Oil has been demonized by the Left. Oil must be punished by Left leaning politicians and their supporters. While the Lefties continue to call for the big bad Oil producers to be severely punished, how many of them know that their beloved union and public pension funds are heavily invested in oil futures?

In our north of the border election right now, all the Lefties are calling for massive new taxation to be applied to the hated Oil industry in order to fund their socialism. But for some dumb reason they fail to acknowledge this new taxation will only be passed on to the consumer (can you say inflation? I knew you could) and it will only lead to the Oil companies scaling back their spending (can you say job losses, I knew you could) which will of course hurt the return from the industry these Lefties get from their pension funds. They will be hurting themselves and they don't even know it. But hey isn't socialism great? Who needs to work when the government promises to care for your every need from the cradle to the grave.

Capitalism is far from perfect, but it is still better than the alternative.

Try not to worry about the things you have no control over

[dmcoco84 5]

Quote

taxation will only be passed on to the consumer (can you say inflation? I knew you could)

That's technically not inflation... that's the cost of business: increased due to central planning.

[rushmc 23]

Quote

The world is running out of easy to access light sweet crude. But the world is not running out of oil. There will be oil for centuries to come. It will be more expensive to access and refine so naturally it will not be cheap. But investing in oil companies is a good thing for pension funds to do.

However a funny thing happened along the way. Oil has been demonized by the Left. Oil must be punished by Left leaning politicians and their supporters. While the Lefties continue to call for the big bad Oil producers to be severely punished, how many of them know that their beloved union and public pension funds are heavily invested in oil futures?

In our north of the border election right now, all the Lefties are calling for massive new taxation to be applied to the hated Oil industry in order to fund their socialism. But for some dumb reason they fail to acknowledge this new taxation will only be passed on to the consumer (can you say inflation? I knew you could) and it will only lead to the Oil companies scaling back their spending (can you say job losses, I knew you could) which will of course hurt the return from the industry these Lefties get from their pension funds. They will be hurting themselves and they don't even know it. But hey isn't socialism great? Who needs to work when the government promises to care for your every need from the cradle to the grave.

Capitalism is far from perfect, but it is still better than the alternative.

If we have millions of electric cars on the the someday
I wonder where he thinks a consistant source of electricity to charge them will come from?

Given the demand increase it will cause

"America will never be destroyed from the outside,
if we falter and lose our freedoms,
it will be because we destroyed ourselves."
Abraham Lincoln

[winsor 236]

Quote

We have enough oil, between the gulf/Alaska/offshore to last over 200 years alone.

We are the Saudi Arabia of Shale;
Shale to Oil can be produced at $55 a barrel. Our Air force is already doing it.


We do not need to import even 1oz of oil if we utilize our own resources.


Again... how so?

Check your arithmetic. That would amount to 1,460,000,000,000 (1.46 Trilliion) barrels at today's consumption rates, and I have reviewed no estimate of all potential sources combined that is anywhere near that.

We're screwed.

[billvon 3,132]

>The world is running out of easy to access light sweet crude.

And sour crude. But you're right, there will always be oil available; it will just become harder and harder to get. Heck, we can synthesize oil from air and water, given enough energy - so no matter what happens, we will always be able to get a little

[billvon 3,132]

>If we have millions of electric cars on the the
>I wonder where he thinks a consistant source of electricity to charge them
>will come from?

Coal 10% (baseline)
Natural gas 20% (peaker)
Wind/solar/geothermal 20%
Hydro 15% (baseline/storage)
Nuclear 35% (baseline)

[rushmc 23]

Quote

>If we have millions of electric cars on the the
>I wonder where he thinks a consistant source of electricity to charge them
>will come from?

Coal 10% (baseline)
Natural gas 20% (peaker)
Wind/solar/geothermal 20%
Hydro 15% (baseline/storage)
Nuclear 35% (baseline)

Nice dream

how far into the future

30 years? Maybe?

"America will never be destroyed from the outside,
if we falter and lose our freedoms,
it will be because we destroyed ourselves."
Abraham Lincoln

[dmcoco84 5]

Quote

And if you have a shale oil burning vehicle, that's great.

Bro... are you serious?

If shale in mined and refined, I can put it in my Toyota...

Quote

So by reducing the need for them we'd get to them faster? Hmm. Interesting take on economics.

Do you feel that technological advances only come through central planning?

I am, FULLY, in support of opening up the gulf (and not allowing PETROBAS to drill there instead and receive Corporate Welfare to do so, (Bush Started, Obama Finished) and in deeper water than that of the BP DWH), I am for opening Alaska, and both coast lines (Yes, Definitely... You can put a tower on my front lawn, just make it at least 300 ft so I can throw some gainers)

Who would you trust more with Drilling? US? China? Brazil? Venezuela? Nigeria?

I think the USA... and we actually care, so we fix our accidents. Nigeria and China, don't give a damn!

And I would love to use BioFuels that actually make sense (Not Ethanol). Solar for as much as possible, not a big fan of winds power on land, maybe at sea... and Nuclear is wonderful.

Quote

And buses, and ships, and cars. Again, you can, today, walk into a Honda dealership and order a natural gas Civic.

Buses and ships, agreed. I was thinking only cars vs trucks wise, at that moment.

Cars... No. Hydrogen would have been smarter, and GM had one that was fucking sweet... and they got shafted.

Quote

I generate all my power from solar.

Reeeeeeally? You charge up your electric from solar? What is your setup?

Though most everyone else, will be using coal.

Obama thinks we are stupid and need central planning: http://www.youtube.com/watch?v=HlTxGHn4sH4

Quote

I'd say that counts as "close to ready."

Close-------er...

The Nissan sux too.... fuuuuck that.

Tesla Motors is the only one I've seen that's worth anything.



Do you support what we are currently doing with Ethanol?

[CanuckInUSA 0]

Quote

If we have millions of electric cars on the the someday

Not all hybrids are bad. There is one hybrid I pine for. It's not available to the public. But you know in the future thanks to motorsports, more and more companies like Porsche will be pushing the envelop and one day the internal combustion engine will be retired. We're just not there yet.

http://www.youtube.com/watch?v=esWT--TE3ww

Try not to worry about the things you have no control over

[CanuckInUSA 0]

Quote

Obama thinks we are stupid and need central planning:

http://www.youtube.com/watch?v=HlTxGHn4sH4

Obama is a Fabian Socialist.

But ... I still say he is a puppet. He has not done one thing to reform the US Financial Sector. The next sub-prime fiasco will happen again because many of the same people who made this last one happen are still on Wall Street and some of them even work for Obama.

Try not to worry about the things you have no control over

[billvon 3,132]

>If shale in mined and refined, I can put it in my Toyota...

Of course. Heck, if air and water are refined, you can put that in your Toyota too. All the steps (cryogenic separation, Sabatier process, Fischer-Tropsch process) are well understood. Like shale oil, it's just a lot harder to do than it is with light crude.

>Do you feel that technological advances only come through central
>planning?


?? No, not at all. Supply and demand is a good way to get advances.

>Who would you trust more with Drilling? US? China? Brazil? Venezuela?
>Nigeria?

I don't really trust any of them. BP and the Exxon Valdez come to mind.

>Reeeeeeally? You charge up your electric from solar? What is your setup?

A 9.6kW grid interactive solar power system on our house. We generate around 50kwhr/day this time of year.

>Cars... No. Hydrogen would have been smarter . . .

I think hydrogen is indeed another option, but in general natural gas is going to be cheaper, safer and more available, and will give you more range than hydrogen in a vehicle.

>Though most everyone else, will be using coal.

For now, yes. That will change with time as more EV's hit the road.

>The Nissan sux too.... fuuuuck that.

Lots of people here seem to like em.

>Do you support what we are currently doing with Ethanol?

In the short term? Yes. Heck, paying farmers to grow corn is a better idea (in my book) than paying them not to grow crops. Of course in the long term it's probably better to get away from farm subsidies altogether.

In the long term? No, corn based ethanol isn't a good idea in the long term; too resource intensive (mainly water.) Cellulosic ethanol is what we have to switch to to make it a viable long term gasoline replacement.

[kelpdiver 2]

Quote

Quote

>If we have millions of electric cars on the the
>I wonder where he thinks a consistant source of electricity to charge them
>will come from?

Coal 10% (baseline)
Natural gas 20% (peaker)
Wind/solar/geothermal 20%
Hydro 15% (baseline/storage)
Nuclear 35% (baseline)

Nice dream

how far into the future

30 years? Maybe?

WTF? It's there NOW. We have plenty of generation capacity at night.