[KevO]

$this->bbcode_second_pass_quote('', ' ')With gas prices hitting record highs, Exxon Mobil (XOM ) Corp. ought to be drilling like mad and refining more of that black gold, right? As it turns out, the world's largest oil producer thinks it is smarter to use more of its resources to buy back stock. The indirect result: increased pain at the pump for consumers.

[Tyler_JC]

Well, they can't build refineries because of environmental regulation and NIMBY-whining.

Why waste 5 years and hundreds of millions of dollars fighting lawsuits in order to build something that for most of your company's history has been only somewhat profitable?

Additionally, the current bottleneck is a boon to the company, allowing it to extract extra profit from the same number of barrels of oil.

For society, the bottleneck would help to stretch out the current plateau in oil production/consumption for another X years.

The refinery shortage is actually a form of conservation. We will consume less gasoline despite having a surplus of crude oil. Over time, consumers will become more efficient in their use of oil products in order to match the level of production.

Thus, when oil production itself starts to fall, consumers will be able to do more with less.

The alternative scenario, produce as much as possible, as fast as possible only invites a crash.

[lawnchair]

$this->bbcode_second_pass_quote('Tyler_JC', 'W')ell, they can't build refineries because of environmental regulation and NIMBY-whining.

[Jack]

$this->bbcode_second_pass_quote('Tyler_JC', 'W')ell, they can't build refineries because of environmental regulation and NIMBY-whining.

[Tyler_JC]

$this->bbcode_second_pass_quote('lawnchair', '')$this->bbcode_second_pass_quote('Tyler_JC', 'W')ell, they can't build refineries because of environmental regulation and NIMBY-whining.

[Ludi]

Yeah, god knows the environmentalists are so powertful in this country! That's why 95% pf the land is undeveloped wildlife preserve, all rivers and lakes are clean and full of fish, and none of our animals are endangered! The wolf, bear, cougar, and jaguar have all returned to their previous territory, and the bison is roaming freely from Canada to Mexico!

[roccman]

"Well, they can't build refineries because of environmental regulation and NIMBY-whining."

Precisely!!

Even under the current administration of slash and burn...large infrastructure projects take YEARs to get permitted through NEPA.

NEPA will go away in a few years...if not months.

EPA curtailed CAA regulations after Katrina for 60 days...a drop in the bucket for what is to come.

NEPA does account for emergencies...

CFR 40 Part 1500-1508

Sec. 1506.11 Emergencies.

Where emergency circumstances make it necessary to take an action with significant environmental impact without observing the provisions of these regulations, the Federal agency taking the action should consult with the Council about alternative arrangements. Agencies and the Council will limit such arrangements to actions necessary to control the immediate impacts of the emergency. Other actions remain subject to NEPA review.

[MonteQuest]

$this->bbcode_second_pass_quote('Tyler_JC', 'W')ell, they can't build refineries because of environmental regulation and NIMBY-whining.

Why waste 5 years and hundreds of millions of dollars fighting lawsuits in order to build something that for most of your company's history has been only somewhat profitable?

[retiredguy]

Hey Monte,

I hear what you are saying, but don't count out the government just yet. I wouldn't be surprised to see a bill put before congress that offers heavy subsidies to have a refinery build on an abandoned military base.

K I Sawyer in the UP would be a prime location. In the middle of nowhere in an area with a depressed economy. Plus the base is close to rail lines and a port city on Lake Superior.

[pup55]

$this->bbcode_second_pass_quote('', 'I')t's the world's most profitable company, but Exxon is plowing a smaller percentage of its spare cash back into the business

[lawnchair]

$this->bbcode_second_pass_quote('Tyler_JC', '
')I was talking about the local population.

Go ahead, try to build a refinery next to the ocean in this country.

[KevO]

$this->bbcode_second_pass_quote('MonteQuest', '
')Isn't it a better question to ask?:

Why waste 5 years and hundreds of millions of dollars building something that you may only use for a short time, or not at all?

Why do we need more refining capacity with declining or plateauing oil production?

To empty the SPR?

Seriously, if refining capacity for available crude supply was needed ( and it surely is a matter of national security, is it not?) would not the govt declare so and facilitate the expedition of such plants?

Either the govt is in the dark or they know it most likely will not be needed, especially with other refineries being built elsewhere in the world.

And the neocons are not in the dark about peak oil.

[Newsseeker]

Bush offered military bases for those that are willing to build refineries. My guess is there has to be at least one base that is remote enough that NIMBY and environmental concerns don't apply.

[MonteQuest]

$this->bbcode_second_pass_quote('KevO', '1')00% agree Monte. It's not really debateable. They know it's pointless building new ones. Even if someone thought, they could maybe do it, they go to borrow the money and Simmons International says, 'not on your nelly' and so, without putting too fine a point on it.
This is it.

[retiredguy]

Purcatty,

Your logic is a bit twisted. Let's assume that your assumption that the vast majority of Americans are indeed ignorant. The various forms of mass media you cited are all reporting that the shortage of gasoline is due to refinery problems. So what is going to happen? The ignorant masses are going to demand that their congressman do whatever it takes to get those nasty oil companies to build more refineries.

Now the government and the oil companies know the real story, but are they going to inform the unwashed masses? Noooo. The government will offer generous subsidies, just like they have to the nuclear industry, to build more refineries, perhaps on old military bases. Like the one I mentioned in my previous post.

When peak sets in, one can bet the government will engage in all manner of illogical activities just to placate the ignorant populace.

By the time the ignorant begin to see the truth, it will be too late.

[AdamB]

$this->bbcode_second_pass_quote('', ' ')
The world’s top oil companies are expected to generate more cash in 2018 than at any other time this decade after three painful years of cuts, but it isn’t party time yet. The shift in sentiment has been rapid as crude prices have risen by more than 50 percent over the past six months to reach $70 a barrel, a level not seen since the crash year of 2014, thanks to global supply cuts led by OPEC. Only a year ago, many investors still fretted over the sustainability of the sector’s lavish dividend payouts in a weak energy market. Now the focus on company boards is gradually switching from slashing jobs and investment to boosting shareholders’ returns and growth. With memories of the 2014 price collapse still fresh and oil forecast to recover only slowly, frugality remains high on the agenda of boards

[Tanada]

I predict more stock buy back programs and more dividends to maintain paper value. Unfortunately the paper manipulation management style seems to be pervasive in today's corporate America. Stock price is the main metric they use instead of actual physical output of any sort of product or service by their corporation.

[ROCKMAN]

T - "...the paper manipulation management style..." More the just manipulation. Had Chevron bought X million shares of it stock at its recent low and sold today it would have made a 30% ROR in just 8 months. And the amount it could have bought would have been too small to impact the market. Who else would know better that the market overreacted to the oil price crash the folks who know exactly to the penny what its company is worth?

[rockdoc123]

$this->bbcode_second_pass_quote('', 'I') predict more stock buy back programs and more dividends to maintain paper value. Unfortunately the paper manipulation management style seems to be pervasive in today's corporate America. Stock price is the main metric they use instead of actual physical output of any sort of product or service by their corporation.