Thursday, November 15, 2012
The Department of Justice announced today the entry of a guilty plea by BP Exploration and Production, Inc., to criminal charges of felony manslaughter, environmental crimes, and obstruction of Congress. The DOJ press release is attached here. The agreement calls for BP to pay in excess of $4 billion dollars in fines and penalties. The penalty is subject to court approval, and is the largest criminal penalty in U.S. History. The Guilty Plea filed with the federal court in Louisiana is attached here. Three individual BP employees have been indicated, including the 2 highest ranking supervisors aboard the Deepwater Horizon, and a BP executive who served as Deputy Incident Commander after the incident, who is charged with obstruction of Congress and making false statements to law enforcement officials.
Monday, November 12, 2012
The International Energy Agency (IEA), in its World Energy Outlook 2012 (Executive Summary Attached), has forecast that the U.S. will overtake Saudi Arabia as the world's largest oil producer by 2020, and to become a net oil exporter by 2030. Noting the U.S. currently imports about 20% of its total energy needs, the IEA notes the projected energy self-sufficiency of the U.S. represents a "dramatic reversal of the trend seen in most energy importing countries." Regarding natural gas, the IEA notes an interesting situation where abundant gas production, and hence low prices, reduces coal use in the U.S., but frees up coal for export to Europe where coal is a cheaper alternative to natural gas. For U.S. consumption, "low prices and abudant supply see gas overtake oil around 2030 to become the largest fuel in the energy mix." In terms of the forecast for global coal use, steady demand in China and India is forecast, with India overtaking the U.S. as the second-largest coal user by 2025, with India also becoming the larger net importer of coal by 2020. The overall picture for the U.S. certainly is positive. Domestic coal usage is likely to decline with the price pressure from natural gas, however, both the trends in U.S. production and overseas markets indicates a strong role for the shipping industry domestically and for export of coal, oil, and gas.