New Tech Could Turn Seaweed Into Biofuel

In the future, we may not look up to the sun for energy, but down into the ocean’s depths.

This month the U.S. Department of Energy announced an investment of nearly $1.5 million in projects to develop renewable energy from Hawaiian seaweed, following large investments in other parts of the nation in a new push toward the potentially groundbreaking development of seaweed-based biofuels.

The $1.5 million will go toward establishing two large-scale offshore seaweed farms for development and production of biofuels. Of this hefty sum, $995,978 goes to Honolulu’s Makai Ocean Engineering for the development of an ocean simulating model to facilitate offshore seaweed farm design, Kailua-Kona’s Kampachi Farms receives $500,000 to develop an offshore macroalgae farm and test out different seaweed harvesting methods in search of the most efficient model.

The recent investments in Hawaii are just one part of a recent energy trend toward biofuels. The DOE’s Advanced Research Projects Agency-Energy (ARPA-E) program is developing nationwide projects to establish a large-scale macroalgae agricultural industry under the under the Macroalgae Research Inspiring Novel Energy Resources (MARINER) program.

In Massachusetts, the Woods Hole Oceanographic Institution (WHOI) was awarded a whopping $5.7 million from ARPA-E to fund two projects to further advance mass cultivation of seaweed on an industrial scale. $3.7 million of this will go toward the development of a breeding program for sugar kelp (Saccharina latissima), utilizing cutting-edge gene sequencing and genomic resources for the most accurate and efficient selective breeding possible, resulting in a 20 to 30 percent improvement over wild plants. For this endeavor, WHOI will work in conjunction with  the University of Alaska Fairbanks, another MARINER project funding recipient that is currently developing scale model seaweed farms capable of producing sugar kelp for less than $100 per dry metric ton.

The other $2 million given to WHOI goes toward developing a self-sufficient underwater observation system to monitor these large-scale seaweed farms for long periods of time without human intervention. This revolutionary technology is being created by a team from the Applied Ocean Physics and Engineering department.

This huge push in funding and biofuel investments comes in the hope that seaweed could soon be used to power our homes and vehicles. According to ARPA-E, the U.S. could potentially produce 300 million dry metric tons of combined brown and red seaweed per year. Converted to biofuel, this yield could supply 10 percent of the nation’s annual transportation energy demand—a game-changing amount.

Up to this point, domestic cultivation of macroalgae has exclusively been for human consumption, and the majority of seaweed consumed by humans and animals in the U.S. is sourced from wild harvests or imported from other countries with seaweed-farming operations already underway. The ramping-up of local production isn’t just an amazing innovation for domestic biofuel sources, but it’s also a huge relief for wild seaweed beds being over-harvested for local consumption. The seaweed push would also create new jobs, boosting the economic health of many working waterfronts.

With the recent cash influx to create the necessary technology and infrastructure, seaweed—never before farmed in large scales in the U.S.—could quickly replace corn as the country’s primary source of biofuel. This would be a welcome change, as seaweed farms require none of the synthetic fertilizers, huge swaths of land and vast quantities of freshwater that corn cultivation needs.

Like oil and gas, biofuels are also generally composed of hydrocarbons, however, they’re ultimately much closer to the carbon-neutral line because they naturally consume carbon dioxide as they grow. Seaweed is especially efficient in this regard, as it grows significantly faster than terrestrial plants and is able to store large amounts of CO2 in its structure.

The underwater future of energy is well underway. Expect to see cleaner, greener, seaweed-based biofuels in the U.S. marketplace in the next few years.

Originally written for Oilprice.com

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Oil Price Rally Accelerates Shale Boom In Argentina

The Argentinian energy and mining minister Juan Jose Aranguren has announced that the South American nation will be suspending its system of set domestic fuel prices next month, allowing local pricing to be ruled once again by the free market. The decision comes in response to the recent global uptick in oil prices, and is part of a continuing effort to woo international drilling interest and investment in Argentina.

The Argentinian government, in tandem with domestic oil producers and refineries, had been setting quarterly fuel prices within the country over the last year and a half to sustain investment in domestic drilling, despite a years-long global glut and low prices. The system was imposed last January in a treatise succinctly called the Agreement for the Transition to International Prices of the Argentine Hydrocarbons Industry. However, the system was not 100% controlled – it had previously allowed for some degree of market influence when prices are deemed to be high enough to allow free market input.

Now, as prices around the world recover and show significant promise of continued recovery, Argentina plans to turn over liquid fuel pricing entirely to the free market starting in October. This decision, however, could be easily and instantaneously overturned if oil pricing drops back to previous numbers, and the government remains in negotiations with the nation’s major fuel companies.

This being said, it’s looking hopeful that we won’t soon be seeing a significant downturn in fuel prices. This week American crude exports broke records thanks to strong demand, and national prices are rising steadily thanks to a decline in the previously exaggerated inventory in the wake of Hurricane Harvey. The developments in the U.S. are working in tandem with worldwide trends as OPEC applies strict caps on supply (partially in response to overproduction in U.S. shale) and even Russia is following the rules, bringing global prices to a two-year high.

Despite the Argentinian policy change and the global price swell, however, officials have warned that Argentinians should not expect to see an immediate rise in fuel prices. The best guesses suggest that the first major price differences will be seen toward the end of October, following domestic legislative elections.

Experts see this transition as part of a larger trend of rising prices and potentially lucrative investment opportunities in Latin America. In Argentina there’s been a major rush to develop the Vaca Muerta shale play (a massive area the size of Belgium) including heavy investment from supermajors. Argentinian president Mauricio Macri is a decidedly business-friendly leader, and attracting international investment has been a priority for the regime, leading to the aforementioned price-setting policies and other efforts to grow domestic energy production in order to minimize costly fuel imports.

It’s working. Last year Exxon said they may invest over $10 billion in Vaca Muerta shale projects over the next few decades. While the supermajors are focused on Vaca Muerte, however, there are other oil- and gas-rich regions of the vast country lying in wait and Argentina would only be too happy to see them developed as well. A few companies are already taking advantage of the opportunity. As an example, Canada’s PentaNova, also heavily involved in Colombia, has recently opened a Buenos Aires office and acquired Alianza Petrolera S.A., giving them 29 percenta working interest in the Llancanelo heavy oil block and 10% in Llancanelo.

Other companies that operate refineries in Argentina include state-owned YPF SA, and private firms Axion Energy Argentina SA, Royal Dutch Shell Plc and Pampa Energia SA. If and when fuel prices take a turn for the worst, these companies have influence in whether the Agreement for the Transition to International Prices of the Argentine Hydrocarbons Industry is reinstated, purposefully making Argentina an especially low-risk investment opportunity. With global prices going strong and vast untapped reserves patiently waiting for development, Argentina is poised to make oil boom headlines any day now.

Originally written for Oilprice.com

Puerto Rico Could Face 6 Months Without Power

After Puerto Rico was pummeled by Hurricane Maria last week, a Category 4 hurricane with 150 mph winds, the island has been left in shambles. After suffering widespread power outages thanks to Irma, 1 million Puerto Ricans were left without electricity. 60,000 still hadn’t gotten power when Maria brought a total, island-wide power outage and severe shortages in food, water, and other supplies.

As of today there’s still no power on the island except for a handful of generators powering high-priority buildings like select hospitals, and the island likely won’t return to full power for another half a year. This also means that there are next to zero working cell phone towers and no reception anywhere on the island.

Due to the blackout, many residents are relying on small gas-fed generators, and fuel is running out (though authorities in Puerto Rico insist that it’s a distribution problem, not a shortage). Puerto Ricans are waiting in six-hour lines for fuel, while many stations have run completely dry. In most of Puerto Rico there’s no water either – that means no showers, no flushable toilets, and no drinkable water that’s not out of a bottle. In some of the remoter parts of the island, rescue workers are just barely beginning to arrive.

Puerto Rico is experiencing all of the normal catastrophes brought on by a major hurricane – and then some. In Houston after Harvey and Florida after Irma, wastewater pumping systems failed, causing significant sewage spillage. The same is almost guaranteed to happen in Puerto Rico thanks to the sustained power outages, but will be greatly exacerbated by the fact that the island’s electrical system was already “degraded and unsafe”.

In fact, nearly every problem typically faced in the wake of natural disaster will be amplified and accelerated in Puerto Rico thanks to long-existing financial and environmental problems and far fewer rescue and relief workers. Florida and Texas also dealt with contamination from Superfund sites, but Puerto Rico has a whopping 23 in its relatively tiny area.

According to the U.S. Department of Health and Public Services, a superfund site is “any land in the United States that has been contaminated by hazardous waste and identified by the EPA as a candidate for cleanup because it poses a risk to human health and/or the environment.” These sites are put on the National Priorities List (NPL), a list of the most dire cases of environmental contamination in the U.S. and its territories. These are places where a person can’t even walk on the ground and breathe the air without seriously endangering their health.

Even within the designation of Superfund, sites can be ranked in their level of catastrophism, and Puerto Rico is home to one of the very worst. For sixty years the U.S. military used Vieques, an outlying island, for extensive bomb testing. Two thirds of the island now have extreme levels of contamination which have been related to disproportionately high cancer rates among the 9,000 residents. Even today Vieques remains blanketed with unexploded bombs, bullets, and projectiles.

Puerto Rico also has more contaminants to worry about thanks to the coal industry, which has been stockpiling coal ash in southern Puerto Rico. According to Adriana Gonzales of the Sierra Club, an uncovered five-story pile of coal ash situated next to a low-income and minority community in the town of Guayama threatens to toxify the entire area thanks to its content of heavy metals like arsenic, mercury, and chromium that will be released when the rain liquefies the ash.

The coal industry also dumped thousands of tons of coal ash in Puerto Rican landfills for years, a common practice that has recently mushroomed into a disaster as local landfills overflowthanks to the territory’s financial crisis. While the ash is not Puerto Rico’s (it’s owned by Pennsylvania-based Applied Energy Systems) they are now faced with its toxic burden, despite the fact that the Puerto Rican government ordered the company to cover and secure the pile under the threat of Hurricane Irma, weeks before Maria hit.

Puerto Rico’s fallout of Maria will result in a long, long road to recovery. Even though the island is home to 3.5 million U.S. citizens, help is few and far between compared to response in the U.S., and the island’s pre-existing poverty and environmentally dangerous Superfund Sites will make rebuilding a tricky and toxic business, costing in the billions of dollars.

Originally written for Oilprice.com

Can Mexico Capitalize On This Golden Oil Opportunity?

As the political and economic climate in Venezuela continues to deteriorate and oil output sinks to new lows, a production vacuum is opening up in the Caribbean. Seeing an opportunity to take up the gauntlet, the Mexican finance and foreign ministries are working hard on a plan to become the region’s new reigning oil producer.

The plan begins in nearby Cuba. Venezuela had been providing Cuba with generously subsidized oil for over a decade, making the region entirely dependent on agreements and alliance with Caracas. Now Mexico is considering replacing these subsidies to Cuba in addition to a few other Caribbean nations, potentially ending the 18-year alliance between Cuba and Venezuela. If the plan comes to pass, it would compound Venezuela’s issues and isolation, making it possible for the U.S. to impose even heavier sanctions and scoring points for Mexico in Washington D.C.

Just this week Venezuelan president Nicolas Maduro called Venezuelan bond holders to a meeting with Economy Minister Ramon Lobo to discuss the consequences of U.S. sanctions. Maduro’s administration has pointedly claimed that the people who will be hurt most by the sanctions aimed at stymieing the nation’s ballooning debt will be shareholders in the U.S. Indeed, there is outcry that the potential banning of oil imports from Venezuela–the 3rd biggest supplier of oil to the U.S. behind Canada and Saudi Arabia–will dramatically drive up gasoline prices and hurt the U.S. job market. Additionally, the sanctions will block Venezuela from refinancing its debt with U.S. investors and prevents U.S. firms from issuing dividend payments to bankrupt nation.

In order to replace the Venezuelan oil subsidies deal, known as Petrocaribe, Mexico would have to supply Cuba with 55,000 barrels per day and another 39,000 barrels per day to other Petrocaribe nations in the Caribbean and Central America. This is actually a tiny amount compared to what Venezuela was doling out before their production went into steep decline. 5 years ago Venezuela was exporting about 100,000 barrels per day to Cuba and another 120,000 barrels daily to Central America and the Caribbean.

If Mexico goes through with the plan, it will be a bold step. The amount of shipments, especially at a subsidized price, would be a big financial burden on Mexico. The move may improve relations with the U.S. and give Mexico better leverage in NAFTA negotiations, but is likely to be politically unpopular in a time when oil domestic production is less than its best and the economy is volatile.

The plan is being pushed ahead by Mexico’s ministries of finance and foreign affairs, who see the possible fall of Venezuela as an opportunity to create more allies in Central America and the Caribbean. On the other hand, the Mexican energy ministry is not nearly as gung-ho, voicing their considerable concerns about Mexico’s low levels of crude production. Although there is hope for a boost in local production after the country opened its oil fields to foreign investors this year, it’s going to be hard to make the kind of turnaround needed after a 13-year production decline.

Thanks to the proposed Venezuelan sanctions, the U.S. will also be much more thirsty for Mexican oil after losing their 3rd biggest supplier. The gas-guzzling giant will likely be looking to import in much larger quantities of heavy oil from Canada, Mexico and Colombia to meet demand, and Mexico would be foolish to say no to an influx of dollars. The question is, will Mexico be able to respond to demand from the United States and replace Petrocaribe at the same time? There’s no way to predict the future, but it’s extremely unlikely, to say the least, at the rate they’re going.

Originally written for Oilprice.com

Is Cactus Gas The Future Of Biofuel?

The prickly pear cactus (locally known as nopal) is ubiquitous in Mexico. Farmed in massive quantities across the nation, it’s a local food staple, an ancient sacred symbol, and the centerpiece of the nation’s flag. Now, it could be the key to the nation’s energy future.

In the past, the spiny outer layer of the cactus has always been a waste product, but no longer–a group of scientists in Mexican green energy start up Suema discovered a way to turn it into a completely sustainable biogas.

The pilot project dedicated to developing the cactus biogas generator began this May in the south of Mexico City in Milpa Alta, an area already famous for its cactus cultivation. The agricultural district is home to more than 7,000 acres of prickly pear fields and produces 200,000 tons of prickly pear cactus per year, about 10 tons of which–the thick and spiked outer layers–are thrown away daily. The generator is now in place at a local cactus market, where the vendors are enthusiastic about this new way to utilize the tons of cactus husks that once went directly to the trash.

This is not the first time that Mexico has garnered attention for its achievements in green energies. In 2015, it was the first emerging country to publish its emissions reduction targets for the United Nations climate accord, with the ambitious goal of slashing emissions in half by 2050. At the time, it seemed far-fetched but it would now appear that they’re making moves to make good on these promises. Last year green energy comprised 15.4% of the Mexico’s energy mix, but a mere 0.1% of this came from biogas. All of that is about to change.

Suema’s new generator produces biogas by mixing cactus scraps with a special blend of bacteria and heating it to 131 degrees Fahrenheit. This model, a prototype for what hopefully will continue to develop and be made even more efficient, produces 175 kilowatt hours—enough electricity to keep nearly 10,000 low-energy light bulbs burning. When the generator reaches full capacity later this year, it will be able to process 3-5 tons a day, producing 45,000 gallons of biogas. Completing the (re)cycle, at the end of the process, the leftovers can be used for compost.

The government of Mexico City has poured nearly $840,000 into the project, and they intend to keep expanding the project until they have the cactus biogas generators installed at every one of the city’s more than 300 markets with the goal of making them completely energy-autonomous and self-sufficient.

Mexico’s road to renewables has not been easy. Efforts to construct wind farms in Oaxaca, which power half of massive Mexico City, have created a lot of public unrest among the locals. There have been widespread protests among civilians who mistrust the government and the energy companies, accusing the multinational energy firms of breaking promises, leading Mexican into unfair contracts, lack of transparency, and failure to consult with local indigenous communities.

The potential to create energy from prickly pears holds an enormous amount of potential to transform the public image of renewables in Mexico. The technology and the materials are home-grown, so to speak, and the process does not interrupt or interfere with existing communities, where cactus farming is already the primary source of income and way of life. It the government is able to expand the program to the size they desire, it could be a huge step to getting Mexico to their ambitious goal of halving emissions by 2050.

While Mexican oil has seen a big uptick since the country opened its vast reserves to private interests for the first time in nearly 80 years, investing in Mexican petroleum is anything but a sure thing. Recently the Mexican national oil company Pemex was swept up in corruption charges relating to Brazilian construction firms.

The promise of green energy that cactus gas presents is a fresh opportunity in many ways for Mexico and its investors–it’s completely sustainable, making it impervious to the volatility that the local oil industry experiences; it’s funded locally, distancing it from a struggling federal administration bogged down with corruption charges and widespread public distrust; and finally, it’s future-forward. One look at the recent spending history of supermajors and you’ll see that even the powers that be in the oil industry are facing a future where fossils are not the primary source of fuel. Mexico may have vast, untapped reserves of oil, but there’s one thing it has even more of: cactus.

Originally written for Oilprice.com

Alaskan Oil Returns With A Vengeance

After years of steady decline in production and bottomed-out oil prices, Alaska is in a rough spot. They’re over a billion dollars in debt, in large part thanks to unfulfilled cash incentives to oil companies, and now many of their remaining oil producers are pulling out at the same time that the North Slope and Cook Inlet oil fields face thousands of layoffs.

Over the last three decades the Trans-Alaska Pipeline System, which peaked back in 1988, has been steadily draining. Where 2.1 million barrels oil once flowed through daily, now 500,000 barrels trickle through. Older oilfields in Alaska’s oil-rich North Slope have long since been drilled dry, with onetime powerhouses like Prudhoe Bay, the Kuparuk River and the Alpine now nearly out of commission.

But all hope is not lost. Now, after an executive order from U.S. Secretary of the Interior Ryan Zinke, the U.S. Geological Survey (USGS) is updating their assessments of oil and gas on Alaska’s North Slope. The USGS is looking into areas that have been protected from drilling since the 1980s, and reevaluating whether they should be opened anew for petroleum exploration. For the first time in a long time, Alaska is now facing the very real potential of a major energy industry comeback.

It has long been believed that large swaths of protected land in Alaska’s North Slope are home to vast reserves, potentially holding hundreds of millions or even billions of barrels of oil. Since these lands are home to environmentally important and delicate ecosystems, growing more precious all the time, legislation and land management policies have kept them closed to oil interests for decades. Now, with the current bullish administration and a changing government attitude toward environmental regulations, this could all be changing shortly.

Already there is some development stirring on the long-stagnant slope. In April Armstrong Oil & Gas discovered the Pikka Field, which could produce up to 1.2 billion barrels of oil, and is just one of three major finds that have reignited oil interest in the waning North Slope. In March ConocoPhillips announced the unexpected discovery of a reserve that could produce up to 100,000 barrels of oil per day, which prompted them to purchase grand parcels of land in state and federal lease sales last December.

Indeed, ConocoPhillips Alaska has already begun drilling this month at one of their new sites on the North Slope, a big development after the project was delayed last year in response to dismal oil prices. The site, a source of viscous oil, was previously deemed not to be worth the more difficult and costly extraction required for the thicker form of oil. Now, in a turn of events few could have predicted, the $460 million project is back on track and they expect oil to be flowing at the new site before the end of the year at an anticipated rate of 8,000 barrels a day.

Inspired by the new discoveries, other oil companies are now testing their luck as well. This summer Accumulate Energy Alaska, working with Burgundy Xploration of Houston, drilled a test well 40 miles south of the North Slope to experiment with hydraulic fracking, a method that had not yet been tested in the region. Though the oil-flow tests are still in progress at that site, the company already has plans to push forward and drill two new wells next spring after the ground thaws and roads become passable once again.

While it’s too early to say if Alaska is poised for a return to its former glory, it’s certainly an exciting time on the North Slope. With once-frozen projects beginning to thaw, administrative and regulatory tides changing, and international investors pivoting north once again, Alaskan oil is ready for its resurrection.

Originally written for Oilprice.com

The Caribbean Is Poised To Become The Next Major Oil Region

In the future, we may be hearing about the Caribbean a whole lot more when talking about oil and gas. Previously, the area was virtually off the map for the fossil fuels industry, despite its proximity to the vast oil reserves of Venezuela. Now, the Caribbean has suddenly become a point of interest since ExxonMobil discovered major reservoirs in nearby Guyana in 2015.

After their initial huge discovery of the Liza oil field 2 years ago, Exxonmobil also announced last month that they’ve discovered more oil in the Payara reservoir off the coast of Guyana, increasing the total discovery to approximately 500 million barrels. This is huge news for both Exxonmobil and for Guyana, which ranks among the poorest countries in the Western Hemisphere.

ExxonMobil (partnered with Hess Corp. and Statoil) has also recently purchased a new deepwater block for exploration off the coast of neighboring Suriname, another potentially oil-filled nation. Some in the industry are already referring to the Guyana-Suriname Basin as the next big oil region.

Now, those good fortunes could be spreading to the Caribbean as well. Trinidad and Tobago has long been the Caribbean’s largest oil and gas producer. The nation has depended economically on their petroleum reserves since the 1990s, with the energy sector currently comprising 34.9 percent of the country’s GDP. However, more recently the small island-nation’s production has been in decline as production from mature fields has waned and exploration for new fields has been slow in starting. Now, Trinidad and Tobago is hoping that the discoveries in nearby Guyana will bring more interest and investment to the Caribbean.

It’s looking like Trinidad and Tobago will get their wish. Just this month BP Trinidad and Tobago announced two major discoveries totaling approximately two trillion cubic feet (tcf) of gas, which the company’s president called “the start of a rejuvenated exploration program on the Trinidad shelf”.

Similarly encouraged by the massive discoveries in Guyana over the last few years and the foreign interest it has garnered, several other Caribbean nations are beginning to assert themselves as potentially oil-rich countries and attempting to woo foreign companies to start investing in exploration around their islands. One of the biggest examples of this is Jamaica, who have recently caught the attention of UK-based Tullow Oil.

Last week Tullow announced plans to return to offshore locations off the southern coast of Jamaica to explore a field of “live oil” that was brought to their attention by local fisherman earlier this year. The firm will ramp up their 3D seismic surveys this year in hopes that the floating oil will lead them to vast oil fields the likes of their neighbors to the south and the nearby Gulf of Mexico.

The Bahamas has also recently publicized their plans to invite international companies to drill in deep waters off the coast, pointing not only to Guyana and the Gulf, but also to neighboring Cuba’s oil reserves as an indication of what treasures may be laying under the surface of the sparkling Caribbean Sea.

Exploration of oil reserves in the Caribbean may also soon be ramped up and revolutionized by major technological advancements from Ursa Space Systems. The high-tech company has announced a planned expansion to take a global oil inventory, with the Caribbean as one of its first major surveyed regions. Ursa will use satellite imagery to provide reliable and independent weekly inventories of oil stocks down to the tank level for easy calculations and better insight on oil supply and demand, especially in areas of the world where there has previously not been readily-available data.

Originally written for Oilprice.com