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   Gold/Mining/EnergyBig Dog's Boom Boom Room


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From: quehubo12/3/2006 5:26:59 PM
   of 205823
 
Time to start thinking about what if it happens again?

cpc.ncep.noaa.gov

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To: cyesp who wrote (75775)12/3/2006 5:47:04 PM
From: Dennis Roth
   of 205823
 
US demand for ethanol seen raising gas use in fertilizer industry

Knoxville, Tennessee (Platts)--1Dec2006
platts.com

Even with natural gas prices expected to remain high, the US ammonia
fertilizer industry is likely to increase its demand for the feedstock by
100,000 to 200,000 Mcf/d in 2007, an analyst said.

Fertilizer production has been historically variable with the cost of
gas, since the feedstock makes up some 70-90% of the total cost of
manufacturing anhydrous ammonia. Several plants in North America have been
idled either seasonally or permanently as a result of rising gas prices since
the early 2000s.

The Fertilizer Institute has said 17 US ammonia plants have shut down
since 1999 because of high gas prices.

What is different now is that demand for corn-based ethanol has risen
dramatically, notes Bank of America analyst Robert Morris.

"In fact, we expect ammonia demand to increase 5-10% next year due to
increased fertilizer usage resulting from higher demand for corn as a result
of increased ethanol demand as a blending component in gasoline replacing
MTBE," Morris said in a report Thursday. Corn is the key ingredient in ethanol
production, and is also one of the most fertilizer-intensive crops in the
country, he added.

Also spurring US fertilizer production is the trend of decreased imports
of ammonia, Morris said. Although imports of the product rose about 65%
between 1999 and 2004, imports next year are expected to be flat, he said.

US fertilizer plants will likely continue to run even though ammonia
product prices are currently flat while gas prices are high, a situation that
has created a negative margin, Morris said. He said, however, that he expects
ammonia prices to rise in the first quarter as plants ramp up production in
anticipation of the spring planting season.

Acreage dedicated to corn is expected to increase roughly 6% to 84
million acres in 2007 versus a 3% decrease this year. As a result, Morris said
he expects North American ammonia capacity utilization to increase to 90% next
year from an estimated 85% this year, resulting in increased natural gas
demand. When operating at full capacity, he estimates that the ammonia
industry would represent about 2.5% of annual domestic gas consumption.

--Stephanie Seay, stephanie_seay@platts.com

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To: Umunhum who wrote (75868)12/3/2006 6:30:18 PM
From: Big Dog
   of 205823
 
The ship is the Star Princess.

princess.com

princess.com

...and I don't know about the internet, but here is one nice feature:

Wedding chapel featuring wedding-at-sea program officiated by the ship's captain.

dianna ????

big

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From: quehubo12/3/2006 8:42:45 PM
   of 205823
 
EIA 914 updated last week for September.

Texas where most of the land drilling effort is being felt is little better in September than in May.

Has the GOM rolled over?

Overall USA production flat with all this activity leading up to September. USA Drilling really ramped between March and October in the USA, maybe we will feel its impact soon. Then again the Canadian gas directed counted dropped more than the US count rose.

The last 12 weeks we averaged about 90 less gas directed rigs in NA then we did in the first 12 weeks.

eia.doe.gov

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To: smh who wrote (75861)12/3/2006 11:23:27 PM
From: energyplay
   of 205823
 
The Rare Earth Situation - there has been concern about the rare earth situation in Western Countries for a long time.

This may be a longer answer than you wanted.

Most rare earths are found in pegmatite dikes, sort of linear ridges 2-200 feet wide, and 50 feet to a mile long. Mining them tends to be labor intensive, and the processing tend to be labor intensive also.

Rare Earths earn good money for China.

Unocal ownership of Molycorp and the Mountian Pass, California mine was well known. The Mountian Pass mine was partialy shut down by the expansion of a Desert Conservation Area. I understand the ore is close to the surface. Unlike like deep mines which can have flooding, ground creep and cave in problems, the Montain Pass could be restarted fairly quickly. It is not remote, it is about 20 miles from I-15 going from LA to Las Vegas.

California labor costs are a bit higher than China's...

I believe there are some rare earths on the Brush Wellman (NYSE:BW) properties in Utah, in addition to beryllium.

Canada has a large number of rare Earth ore bodies, mostly in Ontario and Quebec.

There has been a search for rare earth deposits, and a number have been found in Africa, Asia outside of China, and other places.

Rare earth consumption has increased with the growth of consumer technology. Because of the increased consumption, there is quite a bit of rare earth in the produciton pipelines for TV phosphor, disk drives, laser equipment, etc.

Inspite of the name Rare Earths, most aren't really rare, just diffused into all sorts of rock, and hard to separate chemically. They are not rare like platinum. To mine them econommcally, you need to find a pegamtite or other rock where they are concentrate - and pegamatites with rare earths are infrequent.

So, bottom line -

Most of the military and economic strategic planners know about this.

It would be hard for China to execute a resource denial strategy that would accomplish anything major. Could they use the economic leverage to dominate phosphor for TV tubes, and thus take over a larger slice of the tube TV market ? Sure. But what do they win ? Look at retail tube TV prices for 19 inch color that isn't a SONY ;-)

Much of the really high tech stuff uses relatively little rare earths - maybe a few box car loads per year for the 50+ companies in the US.

********************

There's a real resource fight over oil, obviously.

There is occasionaly a real shooting war over the cobalt from the Katanga province in the Congo. It is the major source of world cobalt outside of the Former Soviet Union countries.
Cobalt, and lots of it, is essential for jet engines.

The Russian have a great position in the Platinum group metals, Pt, Pd, Ir, Os, Re, Rh. South Africa is a large producer, and there is some prodcution in Canada and a little in Alaska.

The Russains play the Platinum market like a yo-yo, extracting maximum profits.

I don't know about Tungsten, but becuse some of the mines are labor intensive, I expect China has some leverage there.

******************

The above metals, Cobalt and the PGMs, are where I think the US would be vulnerable to resource denial by foreign powers.

*********************

The real economy killer right now is natual gas. The high price has damaged the chemical and fertilizer industries, and thus the US plastics industry and farmers. The high plastics then pushes up cost for car parts, furniture, and other items.

The farm jobs go to Mexico and South America, and the industrial jobs go to East Asia.

The natural gas mess is 98% Made in the US.

Strategic resource denial by our own stupidity.

By the way Alan Greenspan made an extensive speech in Congrressional hearings warning of this about 5 years ago.

**********************

There are other metals in short supply, but they tend be situated in countries allied with the US or in the US.

Nickle is one, but Canada has huge deposits, currently subject of bidding wars for Inco and Falconbridge etc.

Copper is another, but Chile is the main producer, and there is expanding mine production in the US, plus Canada and Australia have procduction.

Uranium maybe be short, but both Canada, Australia, and the US have major deposits.

**********************

I expect it is possible to make good money in all these metals.

How is the questions, but there is a bull market in metals and metal stocks.

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To: Big Dog who wrote (75874)12/4/2006 12:21:41 AM
From: buckbldr
   of 205823
 
Yo, Your Bigness...Put me and Mz B in the "interested" column. We're doing some calculating to see if we can afford to board for what sounds like an intriguing event for this group.

Are there any plans/efforts to try to obtain group prices on the cruise fares, and/or the air fare to Copenhagen? If so, what would be the closing dates for us to indicate confirmation?

If we can just keep ol' Que lookin' out to th' bright side on this weather ('05 summer, extreme hurricanes in GOM...'06 summer, nary a one! Soo...why not '06 Jan, lazy hazy days of summer...'07 Jan, freezin' the balls off a well driller?). Sure would help me and the Missus see fit to come aboard for what's bound to be a helluva great party!

Just added a new pair of long johns to Santa's list to keep my butt warm this winter, Que. <ggg>

Buck

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To: energyplay who wrote (75876)12/4/2006 12:34:16 AM
From: buckbldr
   of 205823
 
An excellent post, EP. Very enlightening. Thanks, Buck

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To: energyplay who wrote (75876)12/4/2006 2:25:07 AM
From: White Bear
   of 205823
 
You might find this interesting.

union.edu

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To: Dennis Roth who wrote (75864)12/4/2006 4:00:17 AM
From: enginer
   of 205823
 
US Govt Develops alternative to Palm Oil, uses much less Land

In a multi-decade long project the government studied an oil source that would reduce the impact on Cornflakes prices from the rediculous ethanol fad we are seeing. Many millions are being spent on this concept by private companies who see the potential to gain carbon credits and even eliminate much NOx from power plant stacks...

Land costs are 1000 times less than biodiesel from Soy!

nrel.gov

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To: White Bear who wrote (75879)12/4/2006 6:02:53 AM
From: Condor
   of 205823
 
That was very interesting.
Thanks a lot thanksalot.

C

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