Global News Post: Oil

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<span style="font-family: "Trebuchet MS";">By
<a href="http://www.groundreport.com/Afripol"><span style="color: windowtext; text-decoration: none; text-underline: none;">Afripol</span></a>      <o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";"><span style="color: black;"><a href="http://www.groundreport.com/Business/US-To-Export-Oil-Nigeria-loses-revenue-and-market-/2949109">GroundReport</a>-</span>-- Since
the 1973 oil embargo imposed on <st1:country-region w:st="on">United States</st1:country-region>
by Arab oil producing nations, <st1:country-region w:st="on">United States</st1:country-region>
has not relented in pursuit of strategies to make <st1:country-region w:st="on"><st1:place w:st="on">America</st1:place></st1:country-region> energy secured and
sufficient. The energy security was paramount to <st1:country-region w:st="on">United
 States</st1:country-region> because of its dependency on foreign oil
especially in the troubled <st1:place w:st="on">Middle East</st1:place>.
American modern industrial complex is run on oil and she cannot afford to be
vulnerable to the instability in <st1:place w:st="on">Middle East</st1:place>,
its primary source of oil. Finally, the formulated strategy is bearing fruit in
a big way and <st1:country-region w:st="on"><st1:place w:st="on">United States</st1:place></st1:country-region>
has apparently reached the promised land of energy sufficiency and it will soon
export crude oil by 2014.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">Earlier,
<st1:country-region w:st="on">United States</st1:country-region> strategic
interest was extended to <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region>
where the supply of sweet ebony crude oil was more reliable. <st1:country-region w:st="on">Nigeria</st1:country-region> was a good alternative to Middle East
where political insecurity and instability are threat to oil shipment to <st1:country-region w:st="on"><st1:place w:st="on">United States</st1:place></st1:country-region>.
The energy policy makers and business community in <st1:country-region w:st="on">America</st1:country-region>
does not want to rely solely on the <st1:place w:st="on">Middle East</st1:place>
oil. Therefore looking beyond Middle East was a smart strategic move, not that
they abandon oil supply from that part of the world but they diversify their
sources of oil supply to include Mexico, Canada, Nigeria, Venezuela and many
other places in southern hemisphere.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">But
even with the myriad sources of oil supply to <st1:country-region w:st="on">America</st1:country-region>,
it has not abandon oil drilling and exploration within continental <st1:country-region w:st="on"><st1:place w:st="on">America</st1:place></st1:country-region>. It is
a goal and principal task among oil explorers in <st1:country-region w:st="on"><st1:place w:st="on">United States</st1:place></st1:country-region> to make a
quantifiable difference in supply of energy for internal consumption. With
innovative technology, strategic planning and implementation, they are
beginning to win the battle.  The technology
and cost that hampered local exploration of oil deposits have been improved and
scientifically uplifted. The cost of production is managed brilliantly with
insight and innovations that are now bearing fruits.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">With
intensive research and development, <st1:country-region w:st="on"><st1:place w:st="on">United States</st1:place></st1:country-region> has struck gold with
discovery of fracking process for recovery of ‘lost’ oil embedded on rock
formations in deep underground. Since 1951 US discovered a large oil deposit at
Bakken formation which is at the landscape which encompassed <st1:state w:st="on">Montana</st1:state>,
<st1:state w:st="on">North Dakota</st1:state>, and <st1:state w:st="on"><st1:place w:st="on">Saskatchewan</st1:place></st1:state>. But the rock formation was
difficult to extract oil from but with fracking procedure US will soon become
an oil exporting nation that will rival <st1:country-region w:st="on"><st1:place w:st="on">Saudi Arabia</st1:place></st1:country-region> and OPEC. The 1920
Mineral Leasing Act which restricted oil export in <st1:country-region w:st="on"><st1:place w:st="on">United States</st1:place></st1:country-region> may be abrogated.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">Chris
Swann, Reuters Breaking views columnist, writing on this subject put it this
way:<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">“<st1:country-region w:st="on"><st1:place w:st="on">America</st1:place></st1:country-region>’s
energy boom is spurring a clash between the realms of politics and economics.
Meaningful exports of oil have been banned for almost a century. But with
output surging and crude fetching a 20 percent discount at home, producers want
to ship it overseas. BP, Royal Dutch Shell and four others have applied for
limited licenses to do just that. Unblocking trade could benefit everyone.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">The
1920 Mineral Leasing Act allows producers to sell only tiny amounts of black
gold abroad. Even shipments to <st1:country-region w:st="on"><st1:place w:st="on">Canada</st1:place></st1:country-region>
require a special license – BP has just secured one. At present <st1:country-region w:st="on"><st1:place w:st="on">America</st1:place></st1:country-region> exports
just 47,000 barrels a day, against imports of over 8 million barrels. Yet
production has shot up 32 percent since 2008.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">The
output surge has been gradually helping to make <st1:country-region w:st="on"><st1:place w:st="on">America</st1:place></st1:country-region> more energy
self-sufficient. The only drawback is that there’s not as much demand at home
for the light sweet crude generated by new fields – and many <st1:country-region w:st="on"><st1:place w:st="on">U.S.</st1:place></st1:country-region> refineries
are configured to process heavy sour crude. On top of that, the pipeline
network for transporting domestic crude is inadequate.”<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";"> At the Bakken formation  there is a reliable crude oil deposit up to
4.3 billion barrels and together with other oil spots in America, there will be
no need for America to import sweet light crude from  Nigeria because the land mass at Bakken
Formation contain essentially sweet light crude.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">At
the present <st1:country-region w:st="on">United States</st1:country-region>
imports 15 percent of its oil from <st1:country-region w:st="on">Nigeria</st1:country-region>
and it was projected to import about 25 percent of its oil consumption from <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region> by
2015. But with discovery of fracking process and with the large deposit of
crude oil at <st1:place w:st="on"><st1:city w:st="on">Bakken</st1:city>, <st1:country-region w:st="on">Nigeria</st1:country-region></st1:place> has to look for another
market for its oil export and consumption.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">Energy
security and sufficiency has been <st1:country-region w:st="on"><st1:place w:st="on">United States</st1:place></st1:country-region> priority and it can
now join the family of oil exporting nations. <st1:country-region w:st="on"><st1:place w:st="on">United States</st1:place></st1:country-region> did a great job in
energy conservation, together with Natural Liquefied Gas, and other energy
alternatives in a mix; it propelled US to achieve energy sufficiency.<o:p></o:p></span></div>
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<b><span style="font-family: "Trebuchet MS";"> Nosedive of price and oil glut<o:p></o:p></span></b></div>
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<st1:country-region w:st="on"><st1:place w:st="on"><span style="font-family: "Trebuchet MS";">Nigeria</span></st1:place></st1:country-region><span style="font-family: "Trebuchet MS";"> policy makers and National Assembly were
squabbling over $75 pegging of oil benchmark for 2013 budget but they come
short of realistic strategic econometric forecasting of oil price by 2014. In
the next couple of years the price of oil will come down but no expert can say
for sure how much it will be but there are chances that price of oil will
dramatically nosedived with <st1:country-region w:st="on"><st1:place w:st="on">United
  States</st1:place></st1:country-region> exporting oil and competing with OPEC
on the world stage.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";"> Another leverage <st1:country-region w:st="on">United
 States</st1:country-region> will enjoy over <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region> and OPEC nations is its
ability to refine its own crude oil. Although, many of the oil refineries in
United States were technologized to process high sulfur oil; but US will
overcome the shortcomings by building refineries geared for sweet light crude
refining, while simultaneously getting a helping hand from nearby Canada.<o:p></o:p></span></div>
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<st1:country-region w:st="on"><st1:place w:st="on"><span style="font-family: "Trebuchet MS";">Nigeria</span></st1:place></st1:country-region><span style="font-family: "Trebuchet MS";"> will feel the heat and may lose more than
other OPEC members because she failed to diversify her economy and leverage oil
generated revenue for development.  The <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region>’s
economy still depended on oil for 95 percent of its foreign exchange; the
economy is not diversified but rather ridden with 'chop chop' corruption. The
economy lacks the incentive that it needs to attract a large and enduring
capital that will make a difference in the life of an average Nigerian. The
core social and physical infrastructures that enable the wealth creation to be
sustainable are absent because <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region>
failed to have a clear cut priority. Buying 
private jets, drinking expensive wines and siphoning  money abroad will not cut it. <st1:place w:st="on"><st1:country-region w:st="on">Nigeria</st1:country-region></st1:place>
cannot boast of  uninterrupted  supply of water and electricity for a full
day. That is incredible!<o:p></o:p></span></div>
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<st1:country-region w:st="on"><st1:place w:st="on"><span style="font-family: "Trebuchet MS";">Nigeria</span></st1:place></st1:country-region><span style="font-family: "Trebuchet MS";"> does not have seasoned leaders and patriots
to turn the country around. As the President Jonathan said, one person cannot
do it alone but at same time Nigerians must not be waiting to be invited to
build their own nation.<o:p></o:p></span></div>
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<b><span style="font-family: "Trebuchet MS";">Nigeria‘s
future Market<o:p></o:p></span></b></div>
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<span style="font-family: "Trebuchet MS";">The
appropriate thing to do is to look for market in Far East especially in <st1:country-region w:st="on">China</st1:country-region>, <st1:country-region w:st="on">Japan</st1:country-region>
and <st1:country-region w:st="on"><st1:place w:st="on">India</st1:place></st1:country-region>.
These nations are already doing business in <st1:country-region w:st="on">Nigeria</st1:country-region>;
<st1:country-region w:st="on">China</st1:country-region> for one is not a
stranger in <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region>,
where she is playing an important role in oil exploration. This can also be
said of <st1:country-region w:st="on">India</st1:country-region>; the truth is
that things are going to change because <st1:country-region w:st="on">United
 States</st1:country-region> will not abandon those markets for <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region> and
OPEC nations. With all the internal insecurity bubbling in Nigeria: the
kidnappings, killings, corruption, unreliability; China and India may even
prefer to buy oil from United States that is more reliable, without rancor and
instability.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";"> Therefore <st1:country-region w:st="on">Nigeria</st1:country-region>
must stop and look at internal market for its energy consumption especially
within <st1:country-region w:st="on">Nigeria</st1:country-region> and <st1:place w:st="on">West Africa</st1:place>. But, first and foremost, building more
refineries are quite essential to cease refining oil abroad. <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region> has the
internal market for its energy consumption. Building electricity plants that
are run with its own energy which are in ample supply is the way forward. The
good thing coming out of this is that the time has come for <st1:country-region w:st="on"><st1:place w:st="on">Nigeria</st1:place></st1:country-region> to look
inward and appease the energy demand in the economy rather than sending those
resources off shore.<o:p></o:p></span></div>
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<span style="font-family: "Trebuchet MS";">*Mr.
Emeka Chiakwelu is the principal Policy Strategist at Afripol. Africa Political
& Economic Strategic Center (AFRIPOL) is foremost a public policy center
whose fundamental objective is to broaden the parameters of public policy
debates in <st1:place w:st="on">Africa</st1:place>. To advocate, promote and
encourage free enterprise, democracy, sustainable green environment, human
rights, conflict resolutions, transparency and probity in <st1:place w:st="on">Africa</st1:place>.
www.afripol.org   strategist@afripol.org.</span><span style="color: #333333; font-family: "Trebuchet MS"; mso-bidi-font-family: Arial;"> </span><span style="font-family: "Trebuchet MS";">This work is licensed under
a <a href="http://creativecommons.org/licenses/by/3.0/"><span style="color: windowtext; text-decoration: none; text-underline: none;">Creative
Commons Attribution 3.0 License</span></a>.<o:p></o:p></span></div>
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US To Export Oil: Nigeria loses revenue and market by 2014

By Afripol GroundReport - -- Since the 1973 oil embargo imposed on United States by Arab oil producing nations, United ...