c testing over 3,000 square kilometers of its permit area in September and hopes to drill its first exploration well there by the end of next year. It also has interests in Suriname and Guyana.
Now the big guys are taking the trail blazed by Tullow. Royal Dutch Shell plc announced Wednesday it had acquired a 33% interest in Tullow’s Maritime permit in French Guiana and has an option to buy 12% more later. The purchase, Shell said, “adds quality acreage to our deep water portfolio in the Americas.”
Shell is not the first supermajor to dip its toes in the waters of northern South America. Exxon Mobil Corp. has exploration rights in the huge Stabroek block offshore Guyana, though it’s tight-lipped about what it’s found there. Smaller companies like Canadian independent CGX Energy are also present there.
But the area remains one of the most under-explored in the world. There’s some data from the 1970s, when Elf Aquitaine and Exxon drilled two dry wells. But from then on it was virtually ignored by the majors. That’s changed with the discovery of Jubilee.
The idea that areas on either side of oceans could have the same oil-bearing structures is now well-established. After billions of barrels of oil were found in the “pre-salt” areas offshore Brazil, many began to wonder whether the ultra-deep waters off the coast of Angola, directly across the Atlantic, might bring forth similar treasures.
Meanwhile, for Shell, the Tullow deal makes perfect sense. Like all the majors, it’s struggled to add reserves and increase production as it’s shut out from the more traditional oil-producing areas.
French Guiana might be a leap in the dark- but one that could yield rich returns for a company eager to beef up its exploration portfolio.
A principle role undertaken by the 25x’25 Alliance is to explore opportunities for the agricultural and forestry sectors to participate in the new energy future that is emerging. With national attention focusing on initiatives that can stem climate change, the Alliance is facilitating a discussion on the role of the agricultural and forestry sectors in a reduced carbon economy, in which the use of fossil fuels is decreased and greenhouse gas emissions are reduced.
To further that discussion, 25x’25 today released a study conducted by the University of Tennessee’s Bio-Based Energy Analysis Group that projects how meeting several proposed energy/climate change policy scenarios might impact the U.S. agricultural sector. The policy scenarios that have been analyzed include a cap-and-trade regulatory system and varying treatments of agricultural offsets. The study’s results show impacts on economic returns, climate benefits, feedstock prices and land use impacts.
The study, entitled Analysis of the Implications of Climate Change and Energy Legislation to the Agricultural Sector, shows that net returns for U.S. agriculture are positive under a properly constructed cap-and-trade program. However, the study goes on to show that if carbon emissions are regulated by EPA as prescribed under a 2007 Supreme Court ruling, net farm income is projected to fall below USDA baseline projections.
The long-awaited and comprehensive assessment indicates that income from offsets and from market revenues under a properly constructed cap-and-trade program is higher than any potential increase in input costs, including energy and fertilizer.
A cap-and-trade system that allows multiple offsets, including those for bioenergy crop production, while restricting the removal of crop residues to acceptable, environmentally beneficial levels, would generate some $209 billion over baseline in net returns accumulated from 2010 to 2025. The number jumps to $364 billion over baseline if carbon regulation is left to EPA without legislative guidance.
Input costs will increase under any scenario, the study says. But EPA regulation subjects U.S. agriculture to higher input costs with no opportunity to be compensated for the greenhouse gas reduction services that farmers, ranchers and forestland owners can provide.
The study indicates that no major sh