miércoles, 21 de agosto de 2013

Cameron: We cannot afford to miss out on shale gas.

By David Cameron.
Fracking has become a national debate in Britain – and it’s one that I’m determined to win. If we don’t back this technology, we will miss a massive opportunity to help families with their bills and make our country more competitive. Without it, we could lose ground in the tough global race.
As with any advance in technology, fracking – drilling for so-called “unconventional” gas – has rightly drawn scrutiny. But a lot of myths have also sprung up. So today I want to set out why I support it – and deal with the worst of the myths at the same time.
First, fracking has real potential to drive energy bills down. Labour’s mismanagement of the economy means that many people are struggling with the cost of living today. Where we can act to relieve the pressure, we must. It’s simple – gas and electric bills can go down when our home-grown energy supply goes up. We’re not turning our back on low carbon energy, but these sources aren’t enough. We need a mix. Latest estimates suggest that there’s about 1,300 trillion cubic feet of shale gas lying underneath Britain at the moment – and that study only covers 11 counties. To put that in context, even if we extract just a tenth of that figure, that is still the equivalent of 51 years’ gas supply.
This reservoir of untapped energy will help people across the country who work hard and want to get on: not just families but businesses, too, who are really struggling with the high costs of energy. Just look at the United States: they’ve got more than 10,000 fracking wells opening up each year and their gas prices are three-and-a-half times lower than here. Even if we only see a fraction of the impact shale gas has had in America, we can expect to see lower energy prices in this country.
Secondly, fracking will create jobs in Britain. In fact, one recent study predicted that 74,000 posts could be supported by a thriving shale-gas industry in this country. It’s not just those involved in the drilling. Just as with North Sea oil and gas, there would be a whole supply chain of new businesses, more investment and fresh expertise.
Thirdly, fracking will bring money to local neighbourhoods. Companies have agreed to pay £100,000 to every community situated near an exploratory well where they’re looking to see if shale gas exists. If gas is then extracted, 1 per cent of the revenue – perhaps as much as £10 million – will go straight back to residents who live nearby. This is money that could be used for a variety of purposes – from reductions in council-tax bills to investment in neighbourhood schools. It’s important that local people share in the wealth generated by fracking.
The benefits are clear. But it’s also crucial to put to bed the myths. It has been suggested in recent weeks that we want fracking to be confined to certain parts of Britain. This is wrong. I want all parts of our nation to share in the benefits: north or south, Conservative or Labour. We are all in this together.
If neighbourhoods can see the benefits – and are reassured about its effects on the environment – then I don’t see why fracking shouldn’t receive real public support. Local people will not be cut out and ignored. We are issuing very firm guidance: firms looking to frack should make people aware of their plans well before they apply for a permit. Dialogue is important and if residents express specific concerns, then companies should take them on board. From my experience as a local MP, people tend not to oppose developments for the sake of it. But what they do object to is the idea that their neighbourhood should change without any say. We want people to get behind fracking, and a transparent planning process is an important ingredient.
Equally, we must make the case that fracking is safe. International evidence shows there is no reason why the process should cause contamination of water supplies or other environmental damage, if properly regulated. And the regulatory system in this country is one of the most stringent in the world. If any shale gas well were to pose a risk of pollution, then we have all the powers we need to close it down.
When all is said and done, though, one myth still remains – that fracking damages our countryside. I just don’t agree with this. Our countryside is one of the most precious things we have in Britain and I am proud to represent a rural constituency. I would never sanction something that might ruin our landscapes and scenery. Shale gas pads are relatively small – about the size of a cricket pitch. But more than that, similar types of drilling have been taking place for decades in this country without any real protest. The South Downs National Park remains one of the most beautiful parts of Britain, yet it has been home to conventional oil and gas drilling since the Eighties. The huge benefits of shale gas outweigh any very minor change to the landscape.
So my message to the country is clear – we cannot afford to miss out on fracking. For centuries, Britain has led the way in technological endeavour: an industrial revolution ahead of its time, many of the most vital scientific discoveries known to mankind, and a spirit of enterprise and innovation that has served us well down the decades. Fracking is part of this tradition, so let’s seize it.

martes, 13 de agosto de 2013

American Sands Energy (AMSE) - Eastern Utah (Review by David Riedel)


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Oil sands are a critical source of oil for America. Canada is our largest source of imported oil sending two million barrels a day over the border. Half of that comes from oil sands.
There are extensive oil sands on the U.S. side of the border especially in Eastern Utah where it is estimated that 12 to 19 billion barrels of oil reside.
While fracking and natural gas get so much of the attention these days, oil sands have the potential to become a major domestic energy source.
One of the major challenges with mining and processing oil sands is the fact that traditional approaches use several barrels of water in the processing of one barrel of oil.  This is where one company is significantly different—its process uses no water.
American Sands Energy (AMSE) is a development stage company focused on oil sands deposits in Utah. It has licensed technology to process oil sands without using any water and at a cost well below competitive approaches. Since AMSE’s process uses no water, it creates no tailings or other waste that requires containment or permits.
AMSE is raising capital to build out a 5,000 barrel per day facility in Eastern Utah to process sands from mining claims that it owns or partly owns.  The company currently has 150 mn barrels of likely reserves that it controls and is confident it could add 500 mn barrels of reserves in the area quite easily.
American Sands has licensed technology from Universal Oil Recovery Corp., which has a proprietary solvent and process that allows for a very clean, low energy process that uses no water and results in no emissions or waste products. This technology has been tested on a pilot plant for the past two years and has proven to work efficiently. Once up and running in 2015 the plant will be at break-even at oil prices of $45/barrel (WTI crude is currently at $106 per barrel).
AMSE’s unique process mixes a proprietary solvent with the oil sands that separates the oil (in the form of bitumen) from the sand.  The sand is then re-heated allowing the solvent to escape and be recycled for reuse. The process results in clean dry sand that can be sold or used in mining operations and bitumen that can be used as is in road paving operations or processed into other products.
Risks include permitting risk, processing plant scale risks, considerable related party transactions and exposure to a commodity market.
American Sands is currently loss making and has a market cap of $10 million.  The company estimates that its total capital requirements are $70 million to put all of its properties into production.
We have estimated the company’s value using three popular methods for valuing development stage oil companies. Averaging these three estimates and adjusting for CAPEX and time to reach production provides a value of $58.8 million or $1.56 per share. We believe American Sands Energy is significantly undervalued and represents a unique way to play alternative energy sources in the U.S.