Keeping Natural Gas Green: The Need to Prevent Methane Leaks

Image source: yale.edu

Natural gas, known commonly as the “cleanest” of the fossil fuels, has the potential to reduce significantly the world's reliance on the heavily polluting coal as an energy source, thus cutting greatly on emissions and reducing the environmental impact of energy production as a whole.

However, natural gas has long since been a double-edged sword, comprised mainly of the noxiously polluting hydrocarbon methane. Natural gas energy offers both a challenge and a solution in itself. Consuming the natural gas as energy destroys the methane, creating energy and much lower pollutant emissions in the process.

Most of the pollution derived from natural gas comes in the commercial production of oil. When no market for natural gas is available, it is often flared (burned) or vented for safety purposes relating to the pressure of the underground oil reservoir. This is also the primary source of pollution associated with natural gas.

A considerable amount of pollution is also produced by the gradual leaking of the gas from natural gas production itself, the exact volume of which has only lately been identified. For it bo become truly green, the natural gas industry must reduce leaks to negligible amounts (less than 1 percent). Developments to ensure the effective sealing of natural gas across the entire production chain is necessary to prevent leaks from taking place.

Until recently, leaks of methane have been very difficult to detect due to the odorless nature of the gas. The rotten egg smell associated with natural gas is in fact added to the process and was one of the original ways that leaks were detected. New technology promises to automate the process of detecting gas leaks that they may be remedied almost immediately.

Image source: governorbryant.com

In addition, industry groups and government entities alike must establish clear guidelines to reduce leaks across the industry itself. Strong regulatory requirements could translate to better monitoring of gas leaks and the standardization of measuring and sealing technologies industry-wide.

Brian Alfaro and his company, Primera Energy, are dedicated to both increasing investor value and reducing their operations' environmental impact. For more on his company's oil and gas operations in Texas, visit this LinkedIn page.

The Many Uses Of Petroleum

Image source: petroleum.co.uk

When people think of petroleum, gasoline, and diesel, they will most likely associate it with of cars and other modes of transportation, lighting and power, and industrial production. However, the use of petroleum is not just limited to transportation but in other industries as well.

Agriculture: Agriculturists use petroleum to produce ammonia. Ammonia is used as a nitrogen source in agricultural fertilizers. A long time ago, ammonia from fertilizer came from animal manure and other biological processes.

Pharmaceuticals: Petroleum byproducts are used in creams and different topical pharmaceuticals. Tar, which is used to treat psoriasis and dandruff, is produced from petroleum.

Tires: Tires are usually made of rubber, which is produced from plants. Rubber is a byproduct of butadiene, which is also from petroleum.

Dyes and detergents: Petroleum distils benzene, xylene, toluene, and other chemicals, providing raw materials for dyes, synthetic detergents, and fabrics. Sulfuric acid also originated from sulfur that is removed from petroleum.

Plastics: Every form of plastic—PVC, Styrofoam, and other synthetic products—originated from petroleum. Nylon, which can be found in clothing, containers, and other everyday objects, is also a petroleum-based plastic.

Image source: kessbenfm.com

Primera Energy LLC is a company founded by Brian Alfaro. The company utilizes modern, innovative ways to extract oil from shale. For more information on petroleum products and their uses, subscribe to this blog.

The Surprising Consequences of Current Oil Prices

Image source: kgns.tv

The low prices of crude, seemingly auguring gloom at first glance, hold forth silver linings. The prices signaled by the glut have led to an interesting turn of events, some of which could be taken positively.

Signaling the glut's ultimate end would be the eventual rise in demand that would stabilize prices. Demand is produced by increased economic activity in turn pushed by lower energy costs. In some places, this hopeful turn has already begun to manifest itself.

The low prices of oil imports, for instance, have enabled the United Kingdom to reduce its trade deficits. The falling prices of petroleum products led to the subsequent decrease in the prices of many imported goods; average import prices to the country in early January declined 2.5 percent. These scenarios have huge ramifications for the British economy, whose growth prospects would now be unencumbered by the cost of trade.

Image source: cityam.com

Another effect of the oversupply of oil in the world commodities market is the lack of change in prices caused by tumultuous events in oil-producing nations. Historically, volatility in oil producing nations could cause pricing uncertainty due to the drop in supply. Due to the excess supplies, the confrontation between Saudi Arabia and Iran has yet to significantly impact the price of global crude.   

Should the rates of production continue long after prices stabilize, fluctuations caused by regional tensions may become a thing of the past.

Ultimately, while the world of cheap oil is unlikely to be permanent, the industry itself isn't out of the woods yet. A recovery is in the horizon, though would largely remain gradual for the next few years.

Brian Alfaro currently serves as President of Primera Energy LLC. For more updates on his company and its operations, visit this website.

Countries With the Highest Demand for Oil

Nearly a third of the world’s total oil consumption comes from just 10 countries out of nearly 200. The United States is the world’s biggest oil consumer, followed by Asian countries China, Japan, and India. These are among the most industrialized or the most rapidly industrializing economies in the world, and host high populations, which make them aggressive consumers of oil and its derivatives.

United States

For many decades, the United States has been the world’s biggest oil consuming country. In 2012, it accounted for nearly 20 percent of the world’s total oil consumption per day. In 2005, it recorded the highest level of oil consumption ever, at 20.8mbd (million barrels per day). The strong demand is understandable because the U.S. runs many of the world’s most important factories, the largest thermal power plants, and has the most number of cars on the road. In recent years, however, the demand for oil has been declining. This is attributed to increased use of more fuel-efficient vehicles and growing reliance on renewable sources.

Image source: wikipedia.org

China

China, currently the largest economy in the world by purchasing power parity (PPP), posted the greatest growth in oil consumption over the last decade. China is currently the second biggest oil importing country in the world and its net oil imports have steadily climbed up from 3.43mbd in 2008 to 5.86mbd in 2012.

Japan

Formerly the second richest country in the world (by nominal GDP), Japan remains a heavy consumer of oil and oil products. It recorded its highest oil consumption in its history in 1996 at 5.7mbd. Apart from large-scale industrial activities and high volume of car ownership, the country’s lack of fuel resources also explains its position as the third biggest oil importing country in the world. 

India

Although still a developing state, India ranks fourth among the biggest oil consuming countries on the planet. Its oil consumption in 2012 stood at 3.6mbd, which accounted for about 4.2 percent of the world’s average oil consumption per day during the year. Rapid industrialization and a growing number of wealthy individuals drove the country’s oil consumption to three-fold in just under 20 years.

Image source: wikipedia.org

Brian Alfaro is the founder and president of Primera Energy LLC, a San Antonio, Texas-based petrochemical leader. To know more about the company, visit this website.

Who Gains What Upon Iran's Re-Entry into The International Oil Market

Image source: bidnessetc.com

Although the lifting of sanctions on the Islamic Republic of Iran has yet to become fully manifest until later in the year, the country’s thawing relations with the U.S. are expected to have a profound impact on the petroleum industry as Iranian crude makes its way to the world's market. While the obvious projections have been put forward, the oil industry is rarely simple enough to be summed up in a global manner.

There are specific instances where the arrival of Iranian crude to the market is welcome. Likewise, the expected negative setbacks may hit some states more heavily than others.

On one hand, Russia can stand to lose considerably in this scenario. The arrival of Iranian crude to the European Union, expected to be 25-35 billion cubic meters, could jeopardize Russia's exports to Europe. The implications are also staggering, as the Russian oil industry is based particularly on high cost exploration in the Arctic Ocean.

Image source: euobserver.com

Growing economies like South Africa, on the other hand, are one of the clearest winners in the lifting of sanctions. As the second-largest economy in the continent, South Africa has a growing demand for energy. Moreover, South Africa's refineries specialize in processing much of the crude produced by Iran's oil fields, making the country a prime customer for Iranian oil. Other nations in the region, including Angola, are also expecting to benefit from the lifted restrictions.

Brian Alfaro heads Primera Energy, LLC, which has invested in several oil shale exploration ventures in Texas using state-of-the-art technology. Visit this website for more on the company and its projects.

Economic Impact of Fracking in the Texas Region

Shale gas was first extracted in U.S. in 1821 from shallow fractures. Today, shale gas extracted with modern hydraulic fracturing techniques is the fastest growing contributor to the country's total primary energy deposits.

According to the Energy Information Administration, the state of Texas is the largest producer of shale gas in the country, with the majority produced coming from the Eagle Ford, Barnett, and Haynesville formations.

Image source: huffingtonpost.com

During the height of the shale gas boom in 2002 to 2012, Texas gained over 64,000 jobs. In 2014, indirect economic gains from the Texas oil and natural gas industry resulted in nearly 2 million jobs in related sectors, and the three major Texas shale formations have contributed to more than $300 billion in the state's economic activity.

In addition, a study by the University of Texas at San Antonio Institute for Economic Development projects that a 20 county region in Central and South Texas will support 127,000 direct jobs by 2022.

Most of the country’s skilled drilling workers, as well as executives, researchers, and experts at shale gas extraction reside in Texas. In 2014, the state's oil and natural gas industry paid more than $15 billion in royalties and state and local taxes, providing Texas with the means to fund infrastructure, education, economic development initiatives, children's health insurance, and other projects and public services that contribute to the stability of the state.

Image source: rigzone.com

Current low energy prices are also giving an economic boost, contrary to naysayers. Many international industrial companies, such as Taiwan's Formosa Plastics and Austria's Voestalpine, have set up or are planning to move some of their facilities to Texas. Cheap shale gas prices help narrow the production gap between North America and heavily industrialized countries like China, and government incentives and grants attract investors.

Primera Energy LLC, founded by Brian Alfaro, engages in oil exploration and production in the Barnett and Eagle Ford shale formations. For more discussions on the economic effects of the shale industry, like this Facebook page.

How Will the U.S.–Iran Nuclear Agreement Affect World Oil Markets?

Not too long ago, analysts had to allay fears that the tense relations between Iran and the United States would cause a sudden spike in the price of petroleum. Now, the U.S. and world oil markets are faced with an unusual reversal of the scenario.

Image source: WashingtonPost.com

The continued growth of supply, which has produced a glut in world petroleum markets, drags into more uncertain future with the landmark agreement between the United States and Iran regarding the latter's nuclear policy. With the loosening of international restrictions surrounding Iran's oil exports to the United States and the European Union, the oil industry faces a new challenge that could have several repercussions on the oversupplied petroleum market.

It will be a matter of months before Iranian oil fully penetrates the world market as it did before, the effects of which would largely be dependent on how long the supply glut continues until then, and whether Iran's production would increase not long after.

On the other hand, there remain a few who are convinced that the arrival of oil from Iran would not significantly affect the price of oil. Iran's present production would not have a sustained impact on benchmark crude oil price as it represents only a third of the world's daily consumption. Likewise, an increase in production from the country could trigger a chain reaction that could cause prices to drop significantly.

Image source:  TheIranProject.com

Long-term investors, on the other hand, could see no cause for worry about the prices. Although the expected increase in demand in the season is not considered spectacular, there remains hope, based on previous trends, that gasoline prices (and, by extension, petroleum) would eventually stabilize as demand increases.

Brian Alfaro is the founder and president of Primera Energy LLC, a company based in San Antonio that runs operations in the Eagle Ford Shale and Barnett Shale. Visit this website for more on his company and its guiding principles.