petrochemicals

PETROCHEMICALS – Massive Source of CO2 Emissions

Posted on by Helena

While the Climate Protagonists target vehicles, lawn mowers, leaf blowers, et al, PetroChemicals remain untouched.   Petrochemicals are used for the production of plastics and resins that are found in just about everything including carpet, food, medicine, pesticides, detergents, makeup, beauty products, etc…   We eat oil, lather in oil, let our children chew on oil based toys, walk on oil, cook our food on appliance oils, and wear oil.   All to save the trees.

The petrochemical production plants are a major source of greenhouse gases, air pollution, water pollution, acid rain and ozone depletion. In the US most plants are located in Texas, Louisiana, Pennsylvania and the Appalachians. The health effects include tumors, cancer, asthma, nerve disorders and blood disorders.

Yet for some reason they are NOT mentioned in the Green Weenie Summits.    New plants continue to be constructed across the globe unabated.   42 new petrochemical plants are under construction in the US today.   By 2050, the amount of greenhouse gas emissions from plastic plants is estimated to reach 56 gigatons.

Germany has the largest petrochemical company in the world, BASF, followed by the US, Netherlands and UK.   Working in collaboration with Monsanto, BASF operates in 80 countries including; US, South America, Mexico, Japan, Africa, Australia, India, and across Europe. They have been rated as the 1st largest water polluter and 4th largest air polluter in the world.   Air pollution accounts for 9% of global deaths per year or 5,000,000 people.

Founded by Carl Bosch as IG Farben, BASF collaborated with the Nazi’s in World War II.  Today, revenues top $60 billion annually.

When measuring a country’s output of greenhouse gases, the numbers do NOT account for production plants owned by other countries.   BASF is a German Company polluting the air and water of 80 countries across the globe.   When charts rate and rank countries by their emissions Germany comes in at 2% compared to the US at 15%.   An obvious ‘meaningless’ statistic.

In 2018 BASF self-reported their CO2 emissions at 21.9 million metric tons (not including China plants). Of course like every other political conquest, they ‘plan on reaching -0- emissions by 2050’.   2050 is the NEW 2015…that became 2020, that became 2025, that became 2030, that is now 2050.   They plan to achieve this quest by using renewable electric energy instead of fossil fuels…   Not sure, but it seems to me that electricity does not convert to plastic no matter how much you hoodoo voodoo it.  Plastic is oil. They also make no statement with regard to water pollution.

What they are stating is that plastics will remain a core industry requiring oil and gas, but plant production will attempt to use alternate means ‘if’ BASF can maintain competitiveness in the market.  As for water?  Tough tiddly-winks.

But water pollution isn’t the only trivial pursuit, it takes 1.4 gallons of water (fresh and gray) to produce one plastic water bottle.   90% of those bottles are NOT recycled and end up in the marine ecosystem.   With droughts and water shortages surging, the waste is simply phenomenal!

Given the EPA restrictions in the US and Europe, Africa has been the new source of plant production.   China is another huge source given their lack of pollution awareness.   Still, petrochemicals are NOT going away any time soon unless consumerism simply vanishes.   Bill Gates?  Bill Gates?

Shale was a primary source for the petrochemical industry. When Biden shut down the US industry, it not only impacted our oil and gas independence, it shuttered the US petrochemical industry.   Since Biden’s announcement, gas prices have risen 270%.   Not ONLY affecting prices at the pump, but everything in between which contains ‘plastic’.

The idea that fossil fuels will vanish is absurd.   Until, unless the petrochemical additive can be replaced, no amount of solar or wind will create the physical product.   Thus -0- emissions target is simply a cartoon bubble bobble.

And Greenie Weenie folks out there trying to ban all petrochemical plants have nary a clue what that entails.

OIL – Black Gold looking more like Silver

Posted on by Helena

In the midst of troops deploying to Syria, an escalating war that appears to be headed to engulf the entire Middle East, terrorism, ISIS, and Global Warming…. what has been happening to OIL?

Black gold?

Well, it’s looking more like silver than gold at $40 a barrel and steadily declining.

Normally, when there is war and strife and unrest in the Middle East, oil prices rise in response to a possible shortage. Yet, this time, oil continues to decline. Why is now different?

The are multiple reasons but a few headlines are most noteworthy: OPEC and the Saudi Production.  The Saudis depend on oil for their revenue and the lower oil falls, the more they need to sell to make up for the difference in price.   So, what to do?  They step up production. Sound obvious?

In actuality, the Saudis are hurting, their economy is in a freefall, they operate a 20% budget deficit, their reserves are steadily depleting, and their stock index is generating severe losses. But what are they doing to mitigate?  Not a lot.  They continue to pump more oil, to saturate the market, because it’s all they have. Asking them to stop would be asking them to commit suicide. The petrol industry accounts for 90-95% of ALL their revenue. So if they are already operating at a 20% deficit, how can they possibly absorb ‘more’?

The only way they can pull themselves out of this black spiral is to continue production, raise production and make massive changes in their reliance on oil as their main revenue source, ie Diversify.

But they have another problem – upwards of 90% of their private sector workers are foreign born, only 30-40% of working age Saudis are employed, the government subsidizes the rest. A significant drain on wealth.  But their own citizens don’t have the expertise to manage and run the oil markets, they haven’t the education.   Foreigners spend money, adding to the economy.  But the unemployed suck it back dry.

Not exactly a business model for sustained wealth.

What is their secondary market? Petrochemicals. Petrochemicals are used in the manufacture of plastics and synthetics as well as fertilizers. Monsanto owns it’s own petrochemical plant, Sterling Chemical. And with the land grabs in Africa – fertilizers, GMO’s and petrochemicals will flourish. South Africa is now the 8th largest producer of GMO’s in the world, including maize, soy and cotton.

But with hardline pressure by Monsanto and Syngenta, GMO production has increased dramatically adding Tanzania, Kenya, Uganda, Malawi, Mali, Zimbabwe, Nigeria and Ghana – all on the African Land Grab list.

Saudi Arabia is the third largest investor/holder of land grab in Africa, second is UAE and first is US.  A win-win is the profitability of future agriculture using petrochemical fertilizers…

And while the Paris Climate Summit proposes lowering C02 emissions and toxic gasses, petrochemical pollution and GMO fertilizer pollution rage on.

Petrochemicals are THE MAIN SOURCE of Industrial air pollution. The Industrial Sector is considered the largest source of China’s smog. But the largest producers include: Basf of Germany, DOW of USA, Exxon of USA, Lyondellbasell of Netherlands, INEOS of the UK, Saudi Basic of Saudi Arabia, Formosa of Taiwan, Sumitomo of Japan, and DuPont of USA.  But these represent only the top tiers in an industry that was burgeoning with over 3000 plants worldwide but has also felt the profit bump of falling oil prices.  But while plastic and synthetic production has fallen, fertilizers expand.

And while OPEC countries continue to produce oil, further saturating the markets, other countries have pulled back, their profit margins having long ago been divested. As in the tale of the Tortoise and the Hare, running as fast as you can to the finish line doesn’t necessarily mean you win. But the Saudis have little debt, and can continue to ride the wave plodding like the tortoise, waiting for the fallout from production in other countries to peak before they plug the lid and rapidly push the pricing to potentially extraordinary levels. In the meantime, those countries that closed up shop won’t have the time to retool and will get hit hard.

But the game is not for the faint of heart. The breakeven price of production for Saudi Arabia and Russia is the same at $105, Qatar, Kuwait and UAE is $80, Iran is $130, Libya, Bahrain and Yemen is above $140, while some shale producers in the US report a breakeven as low as $24 in North Dakota.

It is not a game of chess.  Or even Tactics.  Time is the game.  Who can hold out the longest.

And, Time will tell…