The Statistical Review of World Energy

BP just released the BP Statistical Review of World Energy, which is published annually, and covers consumption, production and other statistics on oil, natural gas and other forms of energy for 2009.

I just wanted to point out the statistics on domestic United States production of oil and natural gas.

Natural gas production moved up as everyone expected due to the large scale development of unconventional resource basins. United States natural gas production increased by 3.5% in 2009, the fourth consecutive year that production has moved higher.

A bigger surprise was on the oil side, as production in the United States increased by 460,000 barrels per day, a 7% increase and the largest since the early 1970’s.

It would be premature to read too much into this number, as a one year increase in production coming after a generation of declining numbers, might be a statistical blip. Also, the deepwater moratorium on drilling will impact domestic oil production going forward.

It is something for investors to watch, however, since the 2009 numbers don’t reflect the shift in capital away from natural gas and towards oil development that has gained momentum recently.

Here is a link to the full report.

Fed Details AIG Aid

The Federal Reserve Bank of New has added a new section to its web site detailing the assistance that the bank has extended to AIG during the financial crisis.

This aid was given, according to the bank, to "to preserve the stability of an already fragile U.S. economy and to protect the U.S. taxpayer from the potentially devastating consequences of the company’s disorderly failure."

This is all part of an effort by the Federal Reserve to be more transparent regarding its dealings with institutions.


The link is here

Berman Is Back

Those investors that dabble in the Energy Sector are probably familiar with Arthur Berman, who runs a blog called the Petroleum Truth Report, and has staked his reputation on a bearish point of view on the shale gas resources that are believed by many to be the greatest thing since sliced bread.

Berman comes with impeccable credentials which lends an air of respectability to his writings. He is a Petroleum Geologist that worked for a major oil company for most of his career.

His latest piece was published on the Oil Drum, and I recommend that everyone read it, not because I necessarily agree with everything that he writes, but investors shouldn't fear an opposite opinion.

Here are some provocative excerpts from the post:

"The widespread belief that there is 100 years of natural gas supply in the U.S. because of shale plays is incorrect. Claims that shale gas has resulted in 100 years of supply are based on circular references without underlying documentation, and also do not take high decline rates or anticipated future demand growth into account."

"The current marginal cost of gas production is at least $8/Mcf, and prices will eventually rise to meet that cost."

"The Barnett Shale play is largely non-commercial because the controls on production are complex and difficult to predict."

Read the comments below the post as Berman makes substantial comments in response to readers questions.

Twitter Comment

I came across an interesting comment from Dick Costolo, the Chief Operating Officer of Twitter, as reported on Bloomberg News:

"We have to catch up to our valuation," Costolo said. “We’ve raised all this money. We’ve created this global brand. It’s one of the fastest -- if not the fastest -- growing brands in the history of the world. Now we have to go build the business that lives up to that valuation."

This is a shocking admission that the company is overvalued in the private market, and not something that you hear everyday from an executive at a Technology company.

Lympho-Maniac Charity Event

It's time once again for the annual Lympho-Maniac Charity Event held once a year in the spring in New Orleans. If you are not familiar with this event, it is organized by Chad Landry, an institutional equity salesman who works for Capital One Southcoast. He is also the proprietor of "Chateau Landry," but that's a story for another blog post.

The Lympho-Maniac event is a 70's retro dance party designed to increase cancer awareness with all donations and proceeds going to The American Cancer Society’s Patrick F. Taylor Hope Lodge in New Orleans. Chad is a cancer survivor and started this event up 10 years ago.

Chad is having a very special guest this year for the event, which is being held on Saturday, March 20, 2010. Donald Trump, Jr. and his wife are returning as judges of the dance contest. Click here for more details on the event.

Lympho-Maniac 2010 Promo from Scott Bellina on Vimeo.

If you can't make the event, consider making a donation through the Lympho-Maniac web site.