Murkowski: Global Oil Outages Can Provide “Strategic Warning” of Threats to Stability

Top Energy Committee Republican Warns of Petroleum Production Losses in Libya, Yemen, and Elsewhere

Lisa Murkowski, U.S. Senate, Energy & Natural Resources, oil supply, study, Alaska, Dave Harbour PhotoU.S. Sen. Lisa Murkowski (NGP Photo), today released a report surveying petroleum production outages around the world, data which could be used to provide strategic warning of threats to international security.

“Losses in oil production often reflect instability,” Murkowski said. “Energy reporting clearly pointed to Iraq’s deteriorating security years before the current collapse and provides us strategic warning of violence in other countries and regions.”

Russia To Invest In Alaska: Not Likely (Read Below).


ADNAtle Staalesen, Barents Observer: … Rosneft has asked the Russian government for renegotiated terms in all its offshore oil licenses.  Russian Minister of Natural Resources Sergey Donskoy confirms that the oil giant has requested new terms in a total of 60 licenses….


 ADN by Pat Forgey.  Russia's Rosneft oil company, facing U.S. sanctions following Russia's seizure of part of neighboring Ukraine, won't be buying part of the huge Point Thomson natural gas field on Alaska's North Slope, Exxon Mobil said Wednesday.

Rosneft, one of the world's top oil producers along with Exxon, received the option last year as part of an agreement the two companies signed to expand their strategic cooperation in the Arctic.

But now, Exxon says Rosneft won't be part of the development of Point Thomson.

"Rosneft had evaluated the opportunity, and elected not to participate," said Kimberly Jordan, an Exxon spokeswoman for the company segment that includes Point Thomson and other Alaska operations.

The report, entitled Oil Production Outages & Strategic Warning, is available here. Highlights include :

·      Recent violence in Yemen, Libya, and South Sudan has caused sustained losses in oil production;

·      Petroleum outages clearly illustrate the effectof sanctions against Syria and Iran;

·      Iraq saw significant and rapid increases in petroleum outages concurrent with the rise of ISIS; and

·      Colombia and Nigeria have also seen oil production losses as a result of pipeline sabotage.

The report concludes:

“Sustained levels of such outages in other countries may constitute a degree of strategic warning to policymakers that attention is required, and ultimately are a reminder that record-breaking increases in North American oil production can enhance national security and stabilize global markets.”

Earlier this fall, Sen. Murkowski released staff reports that called attention to the deteriorating security situation in Iraq, as documented by public energy-related reporting, and that analyze ISIS black market oil sales and the possibility of Coalition strikes against ISIS oil.


Our Comment: We are grateful to Chester Carlson of the U.S. Senate Energy and Natural Resources Committee for circulating the timely information above.  It could be valuable to American and Canadian oil producing state/provincial fiscal planning efforts.  

The study could be useful to those concerned with the national economies and national defense and, of course, to energy regulators, marketers, producers, contractors, consumers and investors.  

However, the study generally deals with history — from whence comes data.  While history is interesting it cannot enable one to predict future events with precision, since new developments are constantly affecting and changing assumptions and what would otherwise have been future outcomes.  

Our dear professor, Peter Drucker, always reminded us that trying to predict the future is foolish; that, the purpose of strategy is to take the 'right risks', not to eliminate risk.  

Certainly, this EIA supported study might assist decision makers in identifying the 'right risks' but only in the degree to which the historical data remains relevant.  For example, "…petroleum production outages," could be offset to greater or smaller degrees, either by economic malaise and demand decline or by new discoveries and technologies or a combination of factors.

We believe that Senator Murkowski made appropriate use of conditional statements (i.e. "…can provide strategic…; and, “Losses in oil production often reflect instability….”) and that the study could provide planners with a useful perspective.  -dh


TransCanada Flaring Gas Today

CBC.  TransGas, the pipeline subsidiary of SaskEnergy, is doing a controlled flare of natural gas at its Regina storage cavern southwest of the city this morning. The flare is set to start at 8:30 a.m. CST.

It will last for about three hours.

The location is roughly 1.6 kilometres west and 1.6 kilometres south of the Lewvan overpass, in Regina's southwest corner.

"Flaring is necessary to help TransGas perform operational upgrades to the pipeline system," the company said in a statement.