The New U.S. Role in Global Fossil Fuel Markets
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The New U.S. Role in Global Fossil Fuel Markets
Related Multimedia
The New U.S. Role in Global Fossil Fuel Markets
Related Multimedia
The New U.S. Role in Global Fossil Fuel Markets
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As recently as 2007, the United States seemed headed towards ever greater fossil fuel import dependence, as domestic oil and natural gas production dwindled and consumption continued to grow. Five years later, the landscape looks dramatically different. An explosion in natural gas production from shales has overturned paradigms and sparked bold talk of LNG exports. While less remarked-upon, unconventional oil production has followed suit, helping to boost liquids output 20% from 50-year lows and vaulting North Dakota ahead of Alaska to become the nation’s second-largest oil producer. A new order is emerging in the coal market as well, with efforts underway to ship cheap, low-sulfur coal from the western U.S. to China.
The new role for the U.S. as a hotbed of production and technology development for unconventional resources, a reduced import market, and a possible key exporter of natural gas and coal raises a host of political, economic, and environmental questions. The goal of this conference is to contribute to insightful and data-driven dialogue on these pressing (and often politically-charged) issues by bringing together academics, policymakers, industry experts, and other stakeholder groups.
Session topics will include: (1) the environmental and economic impacts of proposed exports of Powder River Basin coal to China; (2) which will happen first: major LNG exports from the U.S. or shale gas development at scale outside of the U.S. (and especially in China); (3) the changing role of the U.S. in the global oil market, and its geopolitical and economic implications; (4) the cases for and against pipelines connecting Canada’s oil sands with U.S. refineries; and (5) the trajectory of future natural gas demand from the U.S. transportation and power sectors.
Each session will feature a presentation by an academic or industry expert summarizing the state of knowledge on the topic and pointing out major unresolved issues. Discussants from the policymaking and stakeholder communities will then provide their perspectives on the presentation. This will be followed by an opportunity for audience comment and discussion.
Bechtel Conference Center
Conferences
Risk Attitudes Shape National Oil Company Strategies
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Abstract
Mark C. Thurber, David R. Hults
National oil companies (NOCs) often behave in strikingly different ways from one another and from private, international oil companies (IOCs). Given that NOCs control about three-quarters of world oil reserves by equity share, their variation in corporate strategy has important implications for the world oil market. The recently released book Oil and Governance: State-owned Enterprises and the World Energy Supply, which we co-edited (along with our colleague, David Victor) and contributed to, explores the variation among NOCs through 15 detailed case studies and several cross-cutting pieces. Building off the research in that book, our aim in this essay is to discuss the differences among NOCs in their approach to risk.
As described by Nolan and Thurber in Chapter 4 of our book, the notion of risk encapsulates both the likelihood of a negative outcome (e.g., of drilling a dry hole) and the loss that such an outcome would entail (e.g., the investment in an exploration well). Risks are pervasive in the oil industry because of the enormous sums of money on the line and the significant uncertainty around whether investments will prove successful. In this article we suggest that the goals of the state and its tools of governance may cause an NOC to tend towards one of three types of behavior: risk avoidance, risk taking, or risk management. Each of these three approaches to risk, we find, can be useful or counterproductive for the state depending on the context.
It can be useful for an NOC to avoid risk, as Sonangol has done, if its government is highly dependent on oil revenue, but this approach usually means that it must allow IOCs to shoulder risks if the oil sector is to thrive. Intelligent risk taking by the NOC, on the other hand, can help build domestic technological capability and may be a reasonable approach if the government has less need to maximize hydrocarbon revenue in the short term. Finally, commercial risk management by the NOC may be an appropriate model where the NOC has developed some competitive advantages and its government has few remaining expectations for the NOC apart from revenue generation. There is no “right” or “wrong” approach to risk for NOCs in a general sense. The goal of each government and its NOC should be to make sure that the way the NOC takes, avoids, or manages risk is of benefit to both the country and the NOC itself.
Link to article (free trial subscription available) => http://www.worldoil.com/June-2012-Risk-attitudes-shape-national-oil-company-strategies.html
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World Oil
National Oil Companies: Fueling Anxiety
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PESD associate director Mark Thurber will be the speaker at the University of Texas Energy Symposium on March 8 in Austin. His talk, National Oil Companies: Fueling Anxiety, will draw on PESD’s research on NOCs to assess which fears about the dominance of state-controlled oil companies are and are not grounded in reality.
Energy Institute
The University of Texas
Mezes Hall
Mark C. Thurber
Program on Energy and Sustainable Development
616 Jane Stanford Way
Encina Hall East, Rm E412
Stanford, CA 94305
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mthurber@stanford.edu
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PhD
Mark C. Thurber is Associate Director of the Program on Energy and Sustainable Development (PESD) at Stanford University, where he studies and teaches about energy and environmental markets and policy. Dr. Thurber has written and edited books and articles on topics including global fossil fuel markets, climate policy, integration of renewable energy into electricity markets, and provision of energy services to low-income populations.
Dr. Thurber co-edited and contributed to Oil and Governance: State-owned Enterprises and the World Energy Supply (Cambridge University Press, 2012) and The Global Coal Market: Supplying the Major Fuel for Emerging Economies (Cambridge University Press, 2015). He is the author of Coal (Polity Press, 2019) about why coal has thus far remained the preeminent fuel for electricity generation around the world despite its negative impacts on local air quality and the global climate.
Dr. Thurber teaches a course on energy markets and policy at Stanford, in which he runs a game-based simulation of electricity, carbon, and renewable energy markets. With Dr. Frank Wolak, he also conducts game-based workshops for policymakers and regulators. These workshops explore timely policy topics including how to ensure resource adequacy in a world with very high shares of renewable energy generation.
Dr. Thurber has previous experience working in high-tech industry. From 2003-2005, he was an engineering manager at a plant in Guadalajara, México that manufactured hard disk drive heads. He holds a Ph.D. from Stanford University and a B.S.E. from Princeton University.
Associate Director for Research at PESD
Social Science Research Scholar
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National oil companies can cause pain at pump, research shows
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State-owned oil companies dominate the world's oil supplies, and politicians often cannot resist getting involved. When they do, the result is often excessive pollution, poor company performance and volatile oil prices. PESD's Mark Thurber makes the case in a new book.
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Chatham House: National Oil Companies and the Future of the Oil and Gas Industry
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This event marks the UK release of a new book, Oil and Governance: State-owned Enterprises and the World Energy Supply (CUP), from the Program on Energy and Sustainable Development at Stanford University.
The book is the largest and most systematic analysis of national oil companies (NOCs) to date. It includes 15 in-depth case studies of some of the most important NOCs around the world as well as cross-cutting studies of three key determinants of NOC performance and strategy: geological and market risk, political systems and how governments manage their NOCs. Three of the book's authors will present their findings.
Chatham House, London
Mark C. Thurber
Program on Energy and Sustainable Development
616 Jane Stanford Way
Encina Hall East, Rm E412
Stanford, CA 94305
0
mthurber@stanford.edu
new_mct_headshot_from_jeremy_cropped2.jpg
PhD
Mark C. Thurber is Associate Director of the Program on Energy and Sustainable Development (PESD) at Stanford University, where he studies and teaches about energy and environmental markets and policy. Dr. Thurber has written and edited books and articles on topics including global fossil fuel markets, climate policy, integration of renewable energy into electricity markets, and provision of energy services to low-income populations.
Dr. Thurber co-edited and contributed to Oil and Governance: State-owned Enterprises and the World Energy Supply (Cambridge University Press, 2012) and The Global Coal Market: Supplying the Major Fuel for Emerging Economies (Cambridge University Press, 2015). He is the author of Coal (Polity Press, 2019) about why coal has thus far remained the preeminent fuel for electricity generation around the world despite its negative impacts on local air quality and the global climate.
Dr. Thurber teaches a course on energy markets and policy at Stanford, in which he runs a game-based simulation of electricity, carbon, and renewable energy markets. With Dr. Frank Wolak, he also conducts game-based workshops for policymakers and regulators. These workshops explore timely policy topics including how to ensure resource adequacy in a world with very high shares of renewable energy generation.
Dr. Thurber has previous experience working in high-tech industry. From 2003-2005, he was an engineering manager at a plant in Guadalajara, México that manufactured hard disk drive heads. He holds a Ph.D. from Stanford University and a B.S.E. from Princeton University.
Associate Director for Research at PESD
Social Science Research Scholar
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Peter A. Nolan
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pnolan@stanford.edu
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Peter A. Nolan is contributing to research into the strategies and performance of national oil companies with a particular focus on industry structure.
Before joining PESD Mr Nolan worked for 35 years in the oil exploration industry. This included several years in the seismic service industry and 25 years with BP in a range of roles including basin and prospect evaluation, commercial, strategic and business development roles. Recent posts had a focus on the countries of the Former Soviet Union and the Middle East.
He obtained his BSc in geology from Southampton University in 1973.
Paul Stevens
Speaker
Conferences
National Oil Companies and the World Oil Market: Should We Be Worried?
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State-owned oil and natural gas companies, such as Saudi Aramco, Petróleos de Venezuela and China National Petroleum Corp., own 73 percent of the world's oil reserves and 68 percent of its natural gas. They bankroll governments across the globe. Although national oil companies superficially resemble private-sector companies, they often behave in very different ways.
Oil and Governance: State-Owned Enterprises and the World Energy Supply (Cambridge University Press, 2012), a new book commissioned by Stanford University's Program on Energy and Sustainable Development, explains the variation in performance and strategy for such state-owned enterprises. The book, which Mark Thurber co-edited and contributed to, also provides fresh insights into the future of the oil industry and the politics of the oil-rich countries where national oil companies dominate.
Though national oil companies have often been the subject of case studies, for the first time multiple case studies followed a common research design, which aided the relative ranking of performance and the evaluation of hypotheses about such companies' performance. Interestingly, some of the worst performing of these operations belong to countries quite unfriendly to the United States. Mark will also discuss the industrial structure of the oil industry, and the politics and administration of national oil companies. One result of the dominance of this structure for oil markets is that high prices often lead to lower supplies and low prices lead to increased production -- the opposite response of private companies.
To view seminar video, click here.
This is apart of the Weekly Energy Seminar series managed by the Precourt Institute for Energy and the Woods Institute for the Environment at Stanford.
NVIDIA Auditorium, Jen-Hsun Huang Engineering Center
Mark C. Thurber
Program on Energy and Sustainable Development
616 Jane Stanford Way
Encina Hall East, Rm E412
Stanford, CA 94305
0
mthurber@stanford.edu
new_mct_headshot_from_jeremy_cropped2.jpg
PhD
Mark C. Thurber is Associate Director of the Program on Energy and Sustainable Development (PESD) at Stanford University, where he studies and teaches about energy and environmental markets and policy. Dr. Thurber has written and edited books and articles on topics including global fossil fuel markets, climate policy, integration of renewable energy into electricity markets, and provision of energy services to low-income populations.
Dr. Thurber co-edited and contributed to Oil and Governance: State-owned Enterprises and the World Energy Supply (Cambridge University Press, 2012) and The Global Coal Market: Supplying the Major Fuel for Emerging Economies (Cambridge University Press, 2015). He is the author of Coal (Polity Press, 2019) about why coal has thus far remained the preeminent fuel for electricity generation around the world despite its negative impacts on local air quality and the global climate.
Dr. Thurber teaches a course on energy markets and policy at Stanford, in which he runs a game-based simulation of electricity, carbon, and renewable energy markets. With Dr. Frank Wolak, he also conducts game-based workshops for policymakers and regulators. These workshops explore timely policy topics including how to ensure resource adequacy in a world with very high shares of renewable energy generation.
Dr. Thurber has previous experience working in high-tech industry. From 2003-2005, he was an engineering manager at a plant in Guadalajara, México that manufactured hard disk drive heads. He holds a Ph.D. from Stanford University and a B.S.E. from Princeton University.
Associate Director for Research at PESD
Social Science Research Scholar
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