Energy In-depth: As ‘Deepwater Horizon’ hits theaters, BP releases $90 billion economic impact report

by Talk Business & Politics staff ([email protected]) 78 views 

Editor’s note: Each Friday, Talk Business & Politics provides “Energy In-depth,” a round-up of energy and regulatory news.


BP has released an economic impact report showing that the United Kingdom-based oil giant has invested more than $90 billion in U.S. oil, gas and renewable energy development since 2016. BP said it has a larger economic footprint in the U.S. than in any other nation where we operates, and that the U.S. is central to the British oil conglomerate’s global operations.

With operations stretching from the Gulf of Mexico to the North Slope of Alaska, BP employs about 14,000 people across the U.S. and said its business activities support an additional 130,000 American jobs that provide $80 billion in economic impact.

BP is releasing the economic report amid the opening of “Deepwater Horizon,” a movie that chronicles the explosion on a drilling rig in the Gulf of Mexico that led to the worst oil spill in U.S. history. BP, which has paid more than $70 billion in fines and clean-up costs related to the oil spill, criticized the movie’s portrayal of company executives after the Sept. 30 release.

Privately-held oil and gas firm Caelus Energy of Dallas announced on Tuesday (Oct. 4) that it had made a significant light oil discovery on its Smith Bay state leases on the North Slope of Alaska.

Based on two wells drilled in early 2016 as well as 126 square miles of existing 3D seismic, Caelus estimates the oil in place under the current leasehold to be 6 billion barrels.

The small Texas driller said the giant Smith Bay complex, known in the oil industry as an “elephant discovery,” may also contain upwards of 10 billion barrels of oil in place when the adjoining acreage is included. Due to the favorable fluids contained in the reservoir, Caelus said it expects to achieve recovery factors in the range of 30-40%.

“This discovery could be really exciting for the State of Alaska. It has the size and scale to play a meaningful role in sustaining the Alaskan oil business over the next three or four decades. Fiscal stability going forward is critical for a project of this magnitude,” said Caelus CEO Jim Musselman.

The Smith Bay development has the potential to provide 200,000 barrels per day of light, highly mobile oil which would both increase the Trans-Alaska Pipeline System (TAPS) throughput volumes and reduce the average viscosity of oil in the pipeline, extending its long term viability, the company said.

Data from the most recent Commercial Buildings Energy Consumption Survey (CBECS) show that office buildings with data centers have significantly higher computing, cooling, and total electricity intensity (consumption per square foot) than office buildings without data centers.

Data centers usually operate around the clock and are typically kept very cool to avoid failures associated with overheating, and may require a dedicated uninterruptible power supply. Large amounts of electricity are needed to power servers and cooling equipment. A comparison of computing, cooling, and total electricity intensities in office buildings of three different sizes shows that intensities are higher in buildings with data centers. Computing electricity intensity, which includes electricity used by servers and data centers, in addition to desktop computers, laptops, and monitors, is 35% higher for buildings greater than 200,000 square feet, and three times higher for all other buildings.

Cooling electricity intensity in buildings with data centers is almost double that of other buildings in the smallest and largest categories of office buildings and triple that of buildings in the 50,001–200,000 square foot category. Total electricity intensity in buildings with data centers is 87%, 60%, and 20% higher than in buildings without data centers in the 50,000 square feet or less, 50,001–200,000 square feet, and greater than 200,000 square feet categories, respectively.

In all comparisons, electricity intensity is higher for buildings with data centers, although the differences are smaller in larger buildings. In addition, some buildings use non-electric fuels for space cooling where data centers are also likely to raise energy use.

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