Two MIT professors announce the development of the “thermoelectron engine”, a device that coverts heat generated by any type of fuel into electrical energy. Thermal efficiencies of 30% are expected. Like to guess at Royal Dutch Shell’s net income for 1957? Would you believe a paltry $600 million? Conoco reports the development of a seismic method that involves pounding the earth with a vibrating device to create sound waves that are sent through the earth’s strata. “Vibroseis”, as they call it, will reportedly eliminate the need for drilling shot-holes and firing explosives. LPG marketers announce plans to begin mixing ethane into their commercially marketed butane in extremely cold weather areas. The ethane enhances the volatility of the butane far better than does propane. (Not expected to be marketed in Houston.)
East Texas crude oil - $3.25/bbl; U.S. active rig count – 1,789
After buying 6.7 million shares of Unocal stock last month, T. Boone Pickens threatens to acquire Unocal unless some of his proposals are adopted by Unocal’s BOD. China announces plans to open part of its mainland to exploration by foreign countries. In an effort to save consumers more than $10 million/year, Senator Bill Bradley (Remember him Knick fans?) introduces a bill that would require gas pipelines to carry gas for others. Canada appears ready to initiate decontrol of oil prices as part of an energy agreement between the federal government and producing provinces.
U.S. active rig count – 1,939
With drilling rig tightness showing no signs of loosening and long-term contracts tying up many rigs, operators begin looking at buying their own rigs. The U.N. brokers a deal that forestalls a military strike on Iraq by a U.S.-led coalition. Pemex signs a contract calling for Clark USA to finance and build a 200,000 bbl/day refinery at Port Arthur to refine its heavy Maya crude. The Clinton administration ponders whether to impose sanctions against France’s Total, Russia’s Gazprom, and Malaysia’s Petronas for participating in a $2 billion gas development project in Iran.)
Light sweet crude oil - $15.82/bbl; Natural gas - $2.51/MMBTU; U.S. active rig count – 875
The Rest of the Yarn
This is the second in a series of articles profiling international public figures that have significantly impacted the petroleum industry in the 20th and 21st centuries. This month we examine how Ahmed Zaki Yamani first shaped the Saudi petroleum industry and later, most profoundly, the international petroleum industry.
As minister of petroleum, Yamani took his place as a director of the Arabian American Oil Company (ARAMCO), originally a consortium of four American oil companies operating in Saudi Arabia under a concession agreement. Beginning in 1963 he also served as chairman of the board of directors of the General Petroleum and Minerals Organization (PETROMIN), the Saudi government agency responsible for management of energy and mineral resources in the kingdom. He became president of the Supreme Consultative Council for Petroleum and Mineral Resources in 1975.
As the Saudi representative to OPEC, he worked for price stability, energy conservation, and an orderly international oil market. He served as secretary-general of OPEC in 1968-69. In the 1970’s member countries took control of their own natural resources. Saudi Arabia negotiated the nationalization of the assets of foreign companies while retaining their cooperation and expertise. Yamani mediated among the opposing interests of the commercial companies and the oil-producing developing nations.
Yamani masterminded the 1973 oil embargo, which sent worldwide oil prices soaring to record levels and caused economic shock waves worldwide. The severe product shortages which resulted were intended as a clear demonstration of the strategic importance of Arab resources. With the oil embargo, Yamani had the world’s attention, and he held it for the next 13 years as he came to embody Arab oil power. For more than two decades, Yamani’s commands boosted or battered personal pocketbooks and national economies around the world.
Next month, we examine Yamani’s roles and personal lifestyle during the volatile 70’s and 80’s.
Name the discovery well drilled in 1905 near the small village of Tulsa, Indian Territory that spawned a state, several major oil companies, and made Tulsa the oil capital of the world.
If you would like to participate in this month’s quiz, e-mail your answer to email@example.com by noon, April 15. The winner, who will be chosen randomly from all correct answers, will receive a $50 gift certificate to a nice restaurant.
Answer to March’s Quiz
First brought on production in 1892, by the mid-1950’s the Los Angeles City field had cummed more than 20 million barrels of oil from wells located in front yards, back yards, vacant lots, and urban parks of Los Angeles.
Answer to February’s Quiz
In 1680 a Dutchman named Huygens built the first conceptual reciprocating engine (a gun muzzle containing a piston and a protruding connecting rod attached to a revolving crank) in an effort to find a better use for its fuel – gunpowder.
Congratulations to February’s winner – Eric Weber with Oxy Permian