The Trade: Links we Like

Posted on 30 July 2009

– Things are heating up with respect to curbing speculation in oil markets.  The FSA in the UK and CFTC here in the US are both back at trying to de-speculate oil markets.  While the WSJ and Economist fight it out over just how much of a role speculation has actually played in the price of oil, Morgan Downey at Scarce Whales (and author of the very good Oil 101) takes a bold stand: limiting speculators in the oil market will end up in a $2,000 wealth transfer from US households overseas in the form of higher prices at home offset by lower ones abroad.  Speculators of not, peak oil will drive future volatility.

- McKinsey continues to champion efficiency (full report here – it’s big, we’re digging through it).

- The Pacific Northwest National Laboratory recently announced a breakthrough in fluid technology that could potentially make a range of lower temperature geothemal resources viable for power generation.  MIT Technology Review reports “Researchers engineered proprietary nanomaterials made up of metals linked by organic molecules. They found that adding the nanomaterials to a fluid such as hexane or pentane significantly enhanced the heat-trapping properties of the liquid.”

We contacted the PNNL to inquire about how this would impact our LCOE calculations on geothermal and a spokesperson claimed that while it was too early to disclose the economics of the findings it could potentially reduce drilling costs as the fluid would allow the drilling of shallower wells (drilling being a high cost and high risk activity for geothermal companies).   From what we understand, the fluid would be used in binary power systems to allow for greater heat exchange between the reservoir water and transfer liquid.   Interestingly, the technology came from research being done on carbon capture and sequestration from coal – a positive unintended consequence for once.