I mentioned in my last post that President Obama was supporting offshore oil drilling in America.
But only in SOUTH America, not here. Following are the details of that support, from the Wall Street Journal:
The U.S. is going to lend billions of dollars to Brazil's state-owned oil company, Petrobras, to finance exploration of the huge offshore discovery in Brazil's Tupi oil field in the Santos Basin near Rio de Janeiro. Brazil's planning minister confirmed that White House National Security Adviser James Jones met this month with Brazilian officials to talk about the loan.
The U.S. Export-Import Bank tells us it has issued a "preliminary commitment" letter to Petrobras in the amount of $2 billion and has discussed with Brazil the possibility of increasing that amount
So, we're lending Petrobras $2 billion or more. Sure, why not ? The good old USA is loaded ($11.6 trillion in debt) and our economy is doing so darn good (2.2 million jobs lost this year).
Here's a little information about Petrobras, the Brazilian state-run oil company. In 2008, Petrobras made an $18 billion profit. No wonder they need money from Uncle Sam. $18 billion is hardly enough to buy bread. Plus, poor Petrobras has been hit hard by the recession. Their profits are down 20% this year. For the first half of 2009, Petrobras has only made $7.4 billion in profit (link).
So, we're lending $2 billion or more to a foreign oil company that has made $25.4 billion in the last 18 months alone. I'm sure that makes sense somehow, but my little brain can't fathom it, even if big-time financier and left wing slush-funder George Soros can. Soros repositioned his holdings in Petrobras just days before the U.S. loan guarantees to Petrobras were announced. Soros sold 22 million shares of common stock and bought 5.8 million shares of preferred stock, which pay higher dividends. I'm sure Soros didn't have any inside information though. That would be, you know, illegal, and there's nothing at all shady about George Soros.
It would be nice if the USA had it's own offshore oil to invest in, wouldn't it ? We don't know exactly how much we have (lots), because nobody is looking for it. Offshore drilling has been banned off the East and West coasts for years, thanks to the environmentalists and other left wingers like Barack Obama.
I guess the new White House mantra is…….
Drill baby drill, but only in Brazil.
I sure hope we get a President someday who cares about America.
NORTH America, that is.
{ 51 comments… read them below or add one }
You DO realize that it is a bank — The U.S. Export-Import Bank — and therefore it is well within its rights to loan money.
for your reading enjoyment from the U. S. Export-Import Bank
http://www.exim.gov/brazil/pressrelease_082009.cfm
And for those of you who will not read the link — you should. The money is for the purchase of American goods and services ONLY. The bank does not use tax payer money and never has. And OMG 80% of its 4.9 billion it netted in the last 16 years has been authorized to small businesses and it mission is to "help create and sustain jobs for American workers. Sounds like the conservative idea of a w– dream. You really should investigate everything you read in the paper but especially the WSJ. Can you tell I am annoyed? Maybe I got up on the wrong side of the bed and maybe I just think if I cannot trust what MSM has to say I ought to be able to trust what the bloggers say. I know that would be a w– dream.
"It would be nice if the USA had it's own offshore oil to invest in, wouldn't it ? We don't know exactly how much we have (lots), because nobody is looking for it."
Ten oil and gas lease sales were held in the Atlantic during 1976 and 1983. Forty-seven exploratory wells were drilled. Only five wells discovered hydrocarbons. These five wells were offshore New Jersey and were abandoned as non-commercial.
http://www.mms.gov/offshore/atlantic.htm
Another enlightening document at
http://peswiki.com/index.php/Directory:North_American_Oil_Fields
showing that of the 20.97 billion barrels of oil in the us (one day's consumption is around 20 million barrels a day so that is 100 days of oil) 0.08 billion of it is on the us Atlantic coast.
Geez alchemist, nothing like rubbing Da King`s nose in it! Vey well said. And, for those of you who criticizing the recent report of Ford Explorers being replaced by Toyotas, realize this. Toyota has approxiamately 12 MANUFACTURING plants in the U.S. and Honda has several, which employs AMERICAN workers. Let say that again…..American workers. In a perfect world it would be nice for American companies to produce in America. But, there are many "American" cars that are produced in Canada. Bring those jobs home? Toyota is expanding in Michigan and creating over 400 NEW jobs. Just asking!
Ya I guess I got out of the wrong side of the bed this am. Your information is very well said too. I just get very frustrated with misinformation .. always have .. and if I get out of the wrong side of the bed and read a huge pile of misinformation like this post was I feel the need to correct it. Most days I just consider the source and move on.
This is all very confusing to me. No offence, alchemist but your posts didn’t clear much up for me. That aside, yes terrific, we’re loaning someone money to buy American heavy industry products. However, they’re using that industry to drill for oil. Why can’t America drill for oil ourselves?
Those wells alchemist points to off New Jersey came up empty but in that same analysis, the Minerals Management Service also estimates that this area may contain 130 million barrels of oil and 1.14 trillion cubic feet of natural gas.
Spare me the argument that this is about jobs. Its NEVER been about jobs. If it was about jobs then our government could open up our areas and have American industry, American drillers, American freighters, American pipe layers, American refineries and American workers doing this job. Great we get supply the equipment for Brazil but they get everything else (including the oil).
This is also disturbing from the environmentalist point of view. “Brazil you’re going to drill responsibly right? I know you really really screwed up the rain forest and doomed us all to famine, rising oceans and hurricanes but your women are hot so we trust you this time to not screw up the earth”
King, I had no idea Soros stood to gain a fortune in this. Thanks for that bit of information. But its all ok since Soros didn’t get soldiers killed like Cheney and Hailburon did to get his oil money.
Thanks for the additional info, alchemist.
We are giving Petrobras $2 billion+ to encourage Petrobras to buy American equipment for Petrobras' offshore oil exploration. Meaning that we are loaning Petrobras $2 billion. I'm pretty sure that's what I said in my original post. Taxpayer dollars are not at risk – as long as Petrobras pays us back. What are the terms of the pay back ? What is the interest rate ?
In any case, why aren't we doing this in the USA ? Petrobras' efforts may end up benefitting some US manufacturers in the short run, but all the longer term oil production is going to benefit Brazil, not the US. This is just one more example of outsourcing the manufacturing that America should be doing for itself.
Attempting to lowball the amount of US offshore oil is an old trick too. Because we haven't done any exploration for years (you cited data from 1976-1983, quite outdated), we don't know how much offshore oil we have, as I also stated. Brazil, on the other hand, has been looking for their offshore oil, and voila, they found it. That's how it's supposed to work.
And if US offshore oil is so useless, why do we have so many oil rigs in the Gulf Of Mexico, the one area in which we have drilled ? Those have been producing oil for decades, and somehow haven't destroyed the environment, even when exposed to hurricanes like Katrina.
I guess I'm just a crazy old right wing blogger to think the USA should invest in the USA before it invests in Brazil. The Brazilians know to invest in themselves, and that's why they have become a creditor nation, while the USA remains the largest debtor nation on earth. We are so screwed with thinking like this.
Fred says, "And, for those of you who criticizing the recent report of Ford Explorers being replaced by Toyotas, realize this. Toyota has approxiamately 12 MANUFACTURING plants in the U.S. and Honda has several, which employs AMERICAN workers"
No doubt. But wasn't the idea behind Cash For Clunkers supposed to be to improve the environment, not to buy SUV's ? I realize it dawned on the administration in midstream that CFC was actually an economic stimulus (unlike Obama's stimulus package, which was mainly pork spent over years), but the original intent of CFC was environmental. And aren't the taxpayers on the hook for the CFC money ? And won't auto sales dip as much as they rose as soon as CFC ends, which looks to be very soon ?
Does anybody know what the % rate of payback is for this bank? I know the US has made so-called 'loans' before, and also sp-called 'sales' but they were often loans or sales in name only.
No harm admitting you`re wrong King, eh? To alchemist, they just don`t want to see the truth. Hey dd20, you DO know that Brazil IS energy independent?
Isn't it amazing. The current administration could have made the expanded use of domestically produced natural gas a centerpiece of their first year in office. New REAL jobs, less foreign dependency. Instead we get an environmental tax dressed up as Cap and Trade and a Health tax dressed up as health care reform. In addition, Obama and Hillary were both beating each other up in the campaign to show who would bring the troops home faster. How's that working out for you Hope and Changers?
Fred .. like I said "consider the source." They do not want to learn or understand anything that conflicts with their current ideas. I guess those tar balls all over Galveston Beach were in my imagination.
OK I am at it again.
King look up information on oil seep exploration via satellite much of the time (no test drilling involved) as a measure of the presence of off shore oil.
dd20- WOW 130 million barrels mentioned .. that would be 6 more days .. wow
N. E Frye – you could go look it up yourself but this link might help you understand what and how the bank conducts business http://www.answers.com/topic/export-import-bank-of-the-united-states
Knozzmoeking – typical conservative tactic – bait and switch – we are not talking about natural gas or bringing the troops home
Fred something will get me going again I am sure but I do not post often or even read often because it is just not worth the effort.
Knozz, we ARE getting out of George' adventure in Iraq and Obama is trying to finish what the previous knucklehead left unfinished: the defeat of the guys who attacked us on 9/11.
On an unrelated note, while channelsurfing the TV this morning, I stopped at fox tv [for comedic relief] and due to a tech. glitch they had Karl Rove on one side of a split screen and a guy doing a segment on the swine flu on the other…perfect.
The crux of your post, King, I think, is found here….
" to finance exploration of the huge offshore discovery in Brazil's Tupi oil field in the Santos Basin near Rio de Janeiro."
"huge, offshore, DISCOVERY"…….not some guessing game about where oil might be found, ala 'drill, baby, drillers' …..but a sure thing.
alchemist has done a superb job pointing out the inconsistencies…..so, my only observation on this post is that it's much to do about very little.
Unless, of course, the point is having some pity-party for Big Oil. Count me out.
Face it King, you just got PUNKED!
Rev says, ""huge, offshore, DISCOVERY"…….not some guessing game about where oil might be found, ala 'drill, baby, drillers' …..but a sure thing."
Um, not to make the obvious even more obvious, but how do you think they made that "huge, offshore, DISCOVERY" ???? They went looking for it. We should be doing the same.
alchemist,
I don't know why you're so upset. I thanked you for bringing information to light that I didn't have (the purpose of the loan to Petrobras). My purpose here is not to misinform, it's to discuss. I'm glad you posted. I'm not the sole source of information, nor am I infallible. Everyone is welcome. It's not a contest, though at times it seems like it is.
I'm trying to say we should be following Brazil's lead and pursuing offshore oil exploration here, instead of only supporting offshore exploration in other countries. That was my central point, and nothing has changed on that score. The loss of our manufacturing sector is a big reason why America is going downhill. This is but one example.
Estimates of offshore oil and gas vary (because we don't know how much is out there), but according to the OEMM, there's a lot:
"The offshore areas of the United States are estimated to contain significant quantities of resources in yet-to-be-discovered fields. MMS estimates of oil and gas resources in undiscovered fields on the OCS (2006, mean estimates) total 86 billion barrels of oil and 420 trillion cubic feet of gas. These volumes represent about 60 percent of the oil and 40 percent of the natural gas resources estimated to be contained in remaining undiscovered fields in the United States."
http://www.mms.gov/offshore/
How does it make any sense to not go after these resources ? Even as we transition away from oil, which is going to be a long, long process, it's still a lot better to produce our own and reduce imports from countries that are often unfriendly to the United States.
Tbomb,
So that you can someday close the loop on blaming Bush for everything, when will the troops be out of Iraq completely? How many more will be diverted to Afghanistan? When will Obama become the Commander in Chief? You clearly still think Bush holds the title.
The U.S. is going to lend billions of dollars to Brazil's state-owned oil company, Petrobras
King sez….."I'm trying to say we should be following Brazil's lead and pursuing offshore oil exploration here…"
what are you suggesting….the US should have a state run oil company or instead of giving Big Oil billions in free money in the form of tax cuts we should lend them money and charge interest?
King I am not upset. I just do not agree with a lot of what is said on this site and it seems to me at least that often the discussion is not rational so it is not worth the effort ie. "I sure hope we get a President someday who cares about America — North America that is."
As far as drilling offshore. I am not totally against drilling offshore. I worry about the environmental impact because I have seen what has happened is some offshore drilling areas. That said I know there have been improvements in the method of extracting oil from environmentally fragile areas. So if we do drill the problem is that oil is sold in a world market so the oil we recover here does not necessarily benefit the US. Last year The Department of Energy authorized the export of 98. billion cubic feet of natural gas to Japan and other Pacific Rim countries — enough to meet the needs of 1.4 million American families while American families faced an average 22% increase in natural gas rates. So big oil sold the natural gas overseas and each and every Alaskan got a $3200 rebate check – partially because of the natural gas sale. It just does not make sense to me to go for off shore drilling unless it becomes more of an imperative than it is right now today and should that day come I think it should benefit Americans and not just by providing jobs.
King come on – nearly all of those Undiscovered Technically Recoverable Resources – that is an ambiguous mouth full – are undiscovered and technically recoverable in the Gulf of Mexico and Alaska where we are already drilling. Lets leave the US Atlantic and Pacific coasts alone for now.
Let's not leave the coasts alone. There is no environmental hazard to exploring that oil and gas, there is only benefit. I get very weary of people downplaying American potential. That's what has gotten us into the mess we're in. We always think of some reason NOT to do what we should be doing, and then we export the jobs to other countries. "86 billion barrels of oil" ???? Nah. "400 trillion feet of natural gas? ??? Nah.
C'mon now. This is insanity. At the least, we should be trying to promote the interests of our own country. There's nothing irrational about that. What's irrational is the opposite of that.
what is in the best interests of our country is to reduce our usage of oil….
Walter absolutely and AMEN
Knozz, I don't blame Bush for everything; just diverting the military from Afghanistan to Iraq(where 4000 troops have been killed) and letting Bin Laden slip away. The troops will be out of Iraq according to the timetable set up and agreed upon by Iraq and Bush. We will send as many troops into Afghanistan as Petraeus needs (remember the 'Surge'). Bush is not and really never was the CIC.
If he was never the CIC how on earth did he divert all those troops?
larry,
Don't confuse him with logic. Never works on liberals.
alchemist,
I agree we have to transition away from oil, but that's going to take a LONG time to accomplish, and in the meantime, it makes no sense to import any more oil than necessary.
You say, " So if we do drill the problem is that oil is sold in a world market so the oil we recover here does not necessarily benefit the US."
So, you think there's no difference between producing our own oil and importing it from, say, Saudi Arabia ? I couldn't disagree more with that. With domestic oil, the profits stay here, the production is here, we're creating American jobs, and we aren't depending on some foreign country to provide us with the oil we need if our national security is at risk.
great rebuttal …
Mr. King,
There is no such thing as domestic oil, just as there are no American oil companies. They are global companies with no loyalties to any country. Their profits don't "stay here". The production is done by whomever they choose to hire, American or foreign workers. As others have pointed out, oil companies will simply sell to the highest bidder and the amount of oil available is rather insignificant. You are simply regurgitating Republican campaign garbage. Perhaps you have noticed it's no longer a priority for them.
See King – your last paragraph is what I mean by "much of what is posted here is not rational." Thank you Frank for your post. I know the owner of a domestic oil company – the company drills in primarily in OH and PA. The company employs perhaps 6 people and that includes the owner and spouse who by the way work their butts off . The company has made them personally very very wealthy and I say good for them. Is that your idea of a domestic oil company – because that is the only kind of domestic oil company left today.
So, you fellas are saying it's "not rational" to pursue our own domestic oil supplies.
If that's what y'all consider irrational, I'll gladly assume the title. Ignoring our country's own resources while buying those resources overseas is downright stupid. I think you'd agree with me if the resource was anything other than oil (thus revealing that the source of your disagreement on oil is purely ideological). Should we grow our own food ? Should we produce our own cars ? Of course we should. Seriously, I don't know what you can possibly be thinking.
And frank, you are the guy who keeps bemoaning the fact that we've lost so many manufacturing jobs in this country (and you are correct). Now you are telling me domestic oil manufacturing is an area we shouldn't pursue. THAT is what is irrational, so I think it's you who is blinded by the fog of campaign garbage, not me. I'm arguing in favor of this country becoming more self-sufficient. You are arguing against it.
It is so much more complicated that how you have presented it. Like I have said – it is not worth the effort.
Mr. King,
Do you really think that oil companies put out a help wanted sign whenever they put up a new drilling rig? These are high stakes jobs requiring a lot of skill and experience. What do you suggest the total number of jobs would be? You are right, I do bemoan the loss of manufacturing jobs. I also see our energy dependence as a strategic weakness. But, as Mr. alchemist points out, the amount of oil is not great enough to have any effect on either blue collar jobs or our dependence on foreign sources of oil.
So you want to promote the creation of only crappy jobs, frank? What's the matter with you?
larry d.,
I didn't know that every job but those on an oil rig were crappy jobs. Thanks for the alert.
You criticized the jobs because they are "high stakes" requiring "skills and experience." I'm beginning to see why you're stuck at the 1979 standard of living.
How's that Gremlin running?
frank says, "Do you really think that oil companies put out a help wanted sign whenever they put up a new drilling rig?"
Why, yes I do, frank. What do you think the oil companies do, use their army of androids to do the work ?
actually, they just move the drill rigs from place to place….you know, just like they do on dry land.
larry d.,
Yeah larry, all 25 of them. Keep working on that "living in the past" meme. You are beginning to refine it a bit. 1979 was such a good year for me, that I don't mind being reminded of it at all.
Mr. King,
No, they use their small army of highly skilled and experienced workers. It is not exactly an entry level position. They may be blue collar, but if they screw up, people may die, millions of dollars of equipment can be ruined, an environmental disaster could occur. I guarantee you that any new drilling site would generate few new jobs for those reasons.
frank,
Who is that "small army of highly skilled and experience workers," frank ? If it's domestic oil, those are AMERICAN WORKERS. I thought you were pro-worker, but here your anti-worker. It's illogical. Not all of the workers on an oil rig are highly skilled either.
Skilled and educated workers are out, King. Only mindless automaton jobs are valued because only mindless automatons believe living at 1979 levels is cause to vote democrat.
larry d.,
Stay away from the brown acid.
Mr. King,
Once again, there are no domestic oil companies. They are all global corporations. The number of jobs will not put the slightest dent in unemployment, or the number of blue collar jobs lost to "free" trade. The amount of oil available will have no effect on our energy shortage
The number of people who work at Applebee's won't put a dent in the worldwide number of workers either, but that's no reason to ban Applebee's.
You really need to get out of that liberal lie mindset, and start embracing pro-American values.
oil companies won't add jobs until oil reaches $140/bbl