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Triple Crunch Log                                                                                                            

its partners need to drill, chief executive Jim Mulva told analysts during a conference call Wednesday. "We think the price levels we see today are unsustainable," he said.”987

28.10.10. Enel cuts green-power IPO price to target institutional investors “sceptical” on renewables. FT: “Enel hopes that by lowering the range to €1.60 to €2.10, from €1.80 to €2.20, it may be able to attract more institutional interest, according to two people close to the discussions. At that range, the expected size of the deal is €2.3bn to €3.4bn. Partially-privatised Enel, Europe’s most heavily indebted utility, had sought to raise at least €3bn ($4.16bn) from the IPO to help reduce its debt to €45bn and reduce the risk of a ratings downgrade. The IPO, which was expected to be the largest in Europe this year, should still get away as it has been heavily subscribed by retail investors, according to bankers close to the process. However, institutional investors, some of which are sceptical about the long–term prospects for renewables businesses, have stayed on the sidelines The offer will close on October 28. Shares are set to begin trading on November 4 on the Milan and Madrid stock exchanges.988

Surging price of oil forces US military to seek alternative energy sources. Guardian: “Fiscal reality is dawning as US jets and warships trial alternative fuels in bid to end military's costly dependence on oil It's a secret just how much oil the US military uses, but estimates range from around 400,000 barrels a day in peacetime – almost as much as Greece – to 800,000 barrels a day at the height of the Iraq war. This puts a single nation's armed forces near Australia as an oil consumer and among the top 25 countries in the world today. Either way it is by far the world's largest single buyer of oil and the last thing any admiral, general or under secretary of defence has had to be been concerned about is whether there's gas in the tanks or that the navy's carbon emissions are a bit extravagant. But there are signs of change. Every $10 rise in the price of oil costs the gas-guzzling US air force around an extra $600m each year. Just keeping one US soldier in Afghanistan with the world price of oil at $80 a barrel now costs hundreds of dollars a day in fuel alone. And because the US as a country imports more than $300bn worth of oil a year, fiscal reality is dawning. The US military spent around $8bn in 2004 on fuel, and probably twice that last year.  The military knows this.  … Coal-based synthetic fuels, and biofuels – from both algae and crops such as corn – are now strong contenders to replace the fuels that the military uses to power its tanks and jet engines, says the Department of defence.”989

Arnold Schwarzenegger flexes muscles to defend California’s climate change law. Guardian: “He has cast himself as a new kind of action man – Eco-defender – claiming that a defeat for Proposition 23 could finally put some steel in Washington's spine to act on climate. We need to go to Washington and say, 'Look what happened: because the oil companies spent money against you and threatened you, you backed off on energy policy and environmental policy'," he told ABC television. "What wimps! No guts!" During the Tweetcast, Schwarzenegger said: "Prop 23 is funded by Texan oil companies. And … they … happen to be the biggest polluters in California."990

Halliburton and BP knew of unstable cement risk weeks before spill. FT: “Halliburton and BP had data weeks ahead of the Gulf of Mexico oil spill that showed the cement mixture the companies used to seal the well was unstable, but did not act on the information, according to a report by the US National Commission investigating the Macondo spill. Tests performed for the investigative panel by industry experts strongly suggested that a mixture that was identical to the base cement slurry that Halliburton used on the well was not suitable. The deficiency “may have contributed” to the blow-out, which killed 11 men and pumped nearly 5m barrels of oil into the sea.”991

Indian electricity lags far behind China. FT: “India may be catching up with China in terms of GDP growth but it still lags far behind on electricity provision. The contrast between the two global heavyweights is stark: nearly 404m Indians currently live without any electricity at all, compared to 8m Chinese. What’s more, while China is projected to achieve universal electrification by 2015, India won’t be fully electrified until 2030, according to a new report from the International Energy Agency. …Poor electricity supplies undermine government efforts to attract foreign companies to invest in India.  For example, offices in the New Delhi suburb of Gurgaon, where many multinationals like Google have their Indian headquarters, are equipped with private power generators.992

Concerns over shortage of rare-earth metals leads to re-opening of costly mines outside China. BBC: “You may never have heard of lanthanum, cerium or neodymium, but these and other so-called "rare earth" metals play a vital role in many modern technologies. Cerium, for example, is an abrasive used in the manufacture of flat screen televisions. Lanthanum is a catalyst much prized by the oil industry, while neodymium is found in computer hard drives. A shortage of rare earths would be a serious problem for businesses around the world, and could lead to higher prices for many consumer goods. Yet analysts say there is a real risk of such a shortage developing. The reason is that this is a market controlled almost entirely by China - 97% of the rare earths used around the world come from China, the bulk of them mined in the mountains of Inner Mongolia. But in recent years, Beijing been limiting exports, by establishing quotas and banning the sale of some products outside the country altogether. … Mining and processing them, however, is a difficult and costly process, which requires large amounts of energy and produces a range of toxic emissions and residues, some of them radioactive. During the 1990s and for much of the past decade, China was able to produce rare earths more cheaply than other countries, leading to the closure of mines elsewhere, notably in Australia and the US. … It would also make life difficult for (Japan’s) carmakers, notably Toyota, which is a leading player in the market for hybrid vehicles. It needs a regular supply of rare earths to make batteries and electric motors for them.”993

Directors under fire over 55% pay rises this year. FT: “The findings from Incomes Data Services, the pay monitoring group, follow Vince Cable’s move this week to consult on greater transparency on how managers are rewarded. Cable said the survey was proof that executive pay needed to “come back down to earth”. The business secretary added: “We have to question whether it is linked closely enough to company performance.”“I’m determined to take a really close look at these important issues and want to see a wide response from industry to my review.” … The average FTSE 100 chief executive took home £4.9m in total earnings in the year to June, according to IDS. That is 88 times the average pay of full-time workers – down slightly from a peak of 94 in 2008, but sharply up on 10 years ago, when corporate chiefs earned 47 times the average.”994

29.10.10. Brazil deepwater well hits another multi-billion-barrel oil reserve. FT: “The Brazilian government has

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