Jobs in Oil Companies

Offshore Oil Rig Jobs

Industry wide, officially recognized guide to land and offshore oil rig employment. The information and services have helped many people get a job on an offshore oil rig. Here is a small selection of what you will learn: Key points that land and offshore rig bosses love to read in the Resume / CV. This really catches the attention of bosses because you appear to be someone that knows what you are talking about or you learn real fast. Either way is good. This industry is different. You need to talk the talk. How to make your Resume / CV powerful for the Oil Industry. Do not waste your time sending the same Resume / CV to the oil companies that you send to other companies. Our forms are short but sweet for a reason. How to use your Cover Letter. Too many people rush this, it is vitally important. We show you how. Key points that land and offshore rig bosses love to read in the Cover Letter. How to push your name to the top. Like everything in life, this is easy when you know how.

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Case Study 161 Production linkages in the oil industry

The stages of the production process through which a firm may integrate depend very much on the technological and production functions of the industry concerned. Figure 16.1 presents a simplified vertical chain for the oil industry, from oil production extraction to the point where the product is sold to another user. For the retailing of petrol, the supply of heavy fuel oil for the generation of electricity and feedstocks for the chemical industry, there are up to eight vertically linked stages. Oil majors, such as Shell, Esso and BP, have traditionally striven to be fully integrated, producing and processing all the oil required to meet all their own demand in the final stages of the production chain. On the other hand, oil companies may not be fully integrated in that they may not use all the crude oil they produce (e.g., they may sell some to other firms for refining) or they may not produce sufficient crude oil to meet all their internal requirements. The nationalization of...

Case Study 162 Kuwait National Oil Company

The traditional importance of vertical integration in the oil industry is illustrated by the strategies pursued by the state oil companies of the major oil producing companies. The Kuwait National Oil Company (KNOC) is one such example. It was first established in 1960 and became fully state-owned in 1975. Its task was responsibility for the country's oil-related assets including oil extraction, oil refining, pipelines and shipping. The company then proceeded to seek opportunities to integrate forward to acquire expertise in exploration, drilling and engineering and to find outlets for its crude oil and refined products. The country is a member of the oil producers' cartel OPEC (Organization of the Petroleum Exporting Countries) and a major producer of crude oil. The prime objectives of vertical integration for KNOC were

Case Study 172 US oil industry related and unrelated diversification

A study by Ollinger (1994) of the US oil industry examined the success or failure of alternative strategies for changing the boundaries of 19 major oil firms and the limits to the transferability of firm-specific skills in the growth process. First, oil companies grew by transferring skills from one industry to another (following Penrose 1959). In general, they initially expanded domestically and then internationally, then diversifying into the related petrochemicals sector and finally into unrelated activities after exhausting their sources of related growth. Second, the number of complementary skills required determined the success of diversification. Oil companies initially profited from diversification into petrochemicals because the industry's research, input needs and production technology were complementary to the oil business. They were less successful in businesses in which fewer complementarities existed, such as coal, land development and road building. Diversification...

Positive versus Normative Analusis

Consumers' preferences for small or large cars, the amount of driving that people do, and so on. To plan sensibly, oil companies, automobile companies, producers of automobile parts, and firms in the tourist industry would all want to know how large the various effects of this tax will be. Government policymakers would also need quantitative estimates of the effects of the tax. They would want to determine the costs imposed on consumers (perhaps broken down by income categories) the effects on profits and employment in the oil, automobile, and tourist industries and the amount of tax revenue likely to be collected each year.

Brief History Of Hedge Funds

Jones style did not take positions in the physical commodity markets, either long or short. So they did not own oil, gold, or other physical assets whose prices were moving relentlessly upward. But they could own stock in commodity-oriented companies gold mining companies, oil companies, and so forth. And, of course, they could take short positions in companies that were being victimized by rising inflation and interest rates. So even a fund like the Jones fund had the potential to perform well during the 1970s.

More Russian stockpile exports

Many policy-makers seem to think that the uranium market can absorb any quantities that governments throw at it. This is assuredly not the case. The uranium market is miniscule next to the markets in other energy fuels. For example, the annual revenues of western nuclear fuel cycle, including the whole front -end of the nuclear fuel cycle -uranium (at current spot values), conversion, enrichment and fuel fabrication services, is only US 10 billion, compared to the annual revenue of just one oil company Exxon Mobil, which was US 298 billion in 2004.

Forced Labor in Soviet Industry

The strict labor laws of the war years were retained in the first years of the postwar period. Moscow and Leningrad factories were removed from wartime regulations in March of 1947, and the regulations were then dropped from factories in other territories in July of 1948, but the draconian law of June 1940 remained in effect (see Table 2.1). Turnover remained the scourge of Soviet employers, despite the fact that the antiturnover decrees remained intact. Turnover peaked in 1947, when it reached 64 percent of workers per year in construction, 54 percent in coal mining, 40 percent in the oil industry, 36 percent in metallurgy, and 34 percent in light industry. Difficult work and living conditions promoted labor turnover,

Historical perspective

In 1963, with few nuclear power plants operating, the price of uranium collapsed when the U.S. Government stopping buying uranium. The U.S. Government had underestimated the strength of the Commercial Market. The famous so called uranium cartel started it's operations as the Uranium Institute as producers tried to continue operations by distributing a limited market demand. Most of the producers at this time were funded or subsidized by Governments or were subsidiaries of large mining companies, mining gold or other minerals or were oil companies. These companies included Homestake a U.S. gold mining publically traded company, Anaconda, a publically traded copper mining company, Union Carbide, a chemical company formerly producing vanadium in the Colorado Plateau and Continental Oil Company, Kerr-McGee, Getty Oil and Gulf Oil, publically traded oil companies, and as government subsidized companies, Rio Algom and the U.S. Government owned Tennessee Valley Authority. Some small private...

The Coordination Of Knowledge

Imagine the difficulties of an oil company headquartered in Texas trying to decide how much gasoline-and what kinds-will be needed in a filling station at the corner of Market and Castro Streets in San Francisco during the various seasons of the year, as well as in thousands of other locations across the country. The people who actually own and operate the filling stations at all these locations have far better knowledge of what their particular customers are likely to buy at different times of the year than anybody in a .corporate headquarters in Texas can hope to have. The amount of such highly localized information, known to thousands of individual filling station owners scattered across the United States, is too enormous to be transmitted to some central point and then be digested in time to lead to government allocations of fuel with the same efficiency as a price-coordinated market can achieve. No oil company knows or cares about this detailed information. All they know is that...

Case Study Lines At The Gas Pump

What was responsible for the long gas lines Most people blame OPEC. Surely, if OPEC had not raised the price of crude oil, the shortage of gasoline would not have occurred. Yet economists blame government regulations that limited the price oil companies could charge for gasoline.

The State of the Nation

Regional and ethical divisions contribute to an overall weak policy implementation backdrop. Oil is an important source of wealth for the country. However, hesitations in defining an appropriate regulatory framework and designing a clear set of policies for this critical sector have hurt investment in the oil industry.

Monopoly And Oligopoly

Economies of scale provide one explanation for oligopolies being able to resist dilution of their market power by the entry of new businesses. Financial and risk-bearing economies are relevant in the case of banking referred earlier (large financial enterprises can buy and sell money in bulk and thus can offer lower price deals to customers) but other economies of scale include technical factors. For example, in aerospace, the oil industry and also in pharmaceuticals, the capital threshold that new firms have to cross before they can bring their costs down to a level commensurate with existing Rockefeller's original Standard oil (So) company accumulated vast profits by buying up or building all the pipelines serving North Eastern US markets with oil from the Southern producer states. This was horizontal integration - monopolising all business at one stage of the production process, in this case the transporting of oil. (In 1911, So was broken up by US anti-trust legislation as a...

Case Study 52 Estimating elasticities for petrol

However, although the overall elasticity for the market as a whole is less than 1, the own price elasticities for individual companies might be expected to be higher. A price advantage for one petrol station in a neighbourhood may significantly increase the quantity demanded at that outlet by attracting customers who might normally go to another station if the prices were the same. Petrol is a homogeneous product bought partly on the basis of price and partly on the basis of convenience in terms of petrol stations passed. A small price differential may only work if the consumer finds it convenient to stop at the cheaper one. To encourage people to visit the same petrol station irrespective of price, oil companies engage in promotional activities to promote brand loyalty.

Daniel Friedman and Alessandra Cassar

Which we assume unless otherwise noted. It is a reasonable description for most merchandise. Alternatively, buyers may all share the same value, but each has only his own imprecise estimate of what that value is (the common values or CV environment). Offshore oil leases are a classic example each lease buyer (oil company) makes its own estimate of the amount of oil that can be recovered, but the actual costs and revenues would turn out to be about the same for all buyers. Intermediate cases are also possible, and similar distinctions can be made with regard to sellers' costs.

State of the Economy

The relative recovery in the football outlook is partly mirrored in economic developments. GDP growth has averaged north of 5 since 2000 01. While this was partly on the back of strong oil prices, it is also in response to the recent opening up of the economy and reduction in the major obstacles to trade, in much the same way as the current status of the team is enhanced by the international flow in players. Nonetheless, just as the team is perhaps overly dependent on a small number of players, its economy is still heavily dependent on the oil industry.

Regulation of Monopoly

When faced with imperfect competition, the most natural policy response is to try to encourage an enhanced degree of competition. There are several ways in which this can be done. The most dramatic example is US anti-trust legislation which has been used to enforce the division of monopolies into separate competing firms. This policy was applied to the Standard Oil Company which was declared a monopoly and broken-up into competing units in 1911. More recently, the Bell System telephone company was broken up in 1984. This policy of breaking-up monopolists represents extreme legislation and, once enacted, leaves a major problem of how the system should be organized following the break-up. Typically the industry will require continuing regulation, a theme to which we return below.

Construction orders and output

Construction covers buildings and infrastructure (such as roads and ports). Orders are sometimes based on contracting work. This may include projects such as oil rigs which really belong in manufacturing production under steel fabrication. The figures usually exclude residential dwellings, but this should be checked.

The Issue Of Credibility

Optimal intervention, by definition, requires that a large degree of discretionary control be entrusted to government decision-makers.16 The expectational problems of discretion, however, generate difficulties for government planning in general.17 Optimal intervention is simply not a possibility because of the problems of information and incentives discussed above. One reason discretionary control does not work is because current decisions by economic actors depend on expectations concerning future policy and those expectations are not invariant of the policies chosen. For example, if for whatever reason (either an increase in demand or reduction in supply) market conditions produced a windfall profit for the oil industry, the government could respond by proposing to tax away those profits with the argument that this will not affect the current supply of oil because it is the result of a past decision. But such a policy would lead oil companies to anticipate that similar...

Sustainable progress indicators

Raw performance data is converted into indexed data by normalizing the data set. The results create flower or spider graph images of the enterprise's overall performance. Figure 8.2 provides a hypothetical sustainability performance index or scorecard for an oil company showing the performance of a number of human, social, environmental and financial indicators. Performance is reported using indexed raw data and targets, budgets or benchmarks where a score of 100 implies performance is either on target or possibly ahead of target. This figure provides an integrated total performance portrait for the enterprise. The sustainability web shows the interrelationships of various performance indicators, ideally in line with the values and operating principles of the enterprise. It graphically illustrated the balancing act between financial profitability, healthy relationships with employees, customers, shareholders, other business partners and the environment...

Organization of Petroleum Exporting Countries F0 Q4

The major world oil producers' forum established by the Baghdad conference of 1960, on the initiative of venezuela. it has aimed to restore oil prices to their pre-september 1960 levels, to keep oil companies' prices stable and to oblige countries not to agree to increase production if another country failed to reach an agreement with an oil company. The five founder members - iraq, iran, Kuwait, saudi Arabia and venezuela - were joined by Qatar in 1961, Libya and Indonesia in 1962, Abu Dhabi in 1967, Algeria in 1969, Nigeria in 1971, Ecuador in 1973 and Gabon in 1975. its affairs were conducted in six-monthly regular and further extraordinary meetings. Following years of turbulent negotiations with oil companies that failed to raise the incomes of the oil countries as much as they desired, the six Gulf oil producers in october 1973 unilaterally increased their oil price by 70 per cent and cut production by 5 per cent in December 1973, there was a further price increase of 13 per...

Example 62 Three hats

Oil companies appear to have fallen victim to the winner's curse during the auctions for offshore oil-drilling rights. Book publishers often feel that by outbidding rivals for the right to publish a book they have paid more than they will ever recoup in profits from book sales. Baseball teams have often outbid other teams for a free agent only to find that they have paid too much for the player's services. The phenomenon also occurs in corporate takeover battles (Thaler, 1992, pp. 57-8 and Dyer and Kagel, 2002, p. 349).

Individual Corporate And Foundation Support

It is not surprising that corporate motives for giving are somewhat different from those of individuals. Some corporate managers may, indeed, believe that it is morally important for their firms to be good corporate citizens, but one suspects that they believe it is even more important that they be seen in that light. Thus, corporations are attracted to forms of giving that are visible or even attention grabbing. That explains, for example, the prominence of corporate support for public television programming. (So great was the generosity of the major oil companies toward public TV during the profitable early 1980s that the joke went around that PBS really stood for Petroleum Broadcasting System.) Special events to which the company name can be attached, such as a blockbuster art exhibition or a series of summer concerts in the park, also attract generous corporate support. Hence, the large share of corporate donations going, respectively, to museums and to musical performances.

Multinational Long Run Return Studies

We should note that the MNNS study ends with data from 1999, and thus does not examine SIP returns after the global bear market in stocks began in earnest in March 2000. The prices of telecom stocks were hammered especially hard from 2000 to early 2003, so it appears certain that SIP investors did not outperform (i.e., they did not lose any less than) other investors over the 20002003 period. Indirect evidence suggests they did not do much worse, however. As we will see next chapter, the total market value of privatized firms accounted for a substantially higher fraction (38.6 percent) of the total non-U.S. stock market capitalization in July 2003 than it did one year earlier, and this in turn was a higher fraction than the roughly 20 percent level of 2000 or 1999. Thus it seems that privatization investors did not have to give back the excess stock returns they enjoyed over the previous decade. Since early 2003, telecoms and oil companies have performed extremely well, so SIP...

Example 72 The Opportunity Cost Of Waiting In A Gasoline Line

1 This special treatment for Chevron stations occurred because these stations were owned and opcr ated by Standard Oil of California. Stations owned by integrated oil companies such as SoCal were affected by the ceiling, but those operated by franchised dealers were not. 'Hie survey was by Robert '1'. Deacon and Jon Sonstelie, Rationing by Waiting and the Value of Time Results froma Natural Experiment Journal of Political Economy 93 (1985) 627-647.

Tangible and intangible resources

The abilities of resources that combine tangible and intangible qualities have come to be termed ''competences''. A competence is the ability of the resources employed to perform a task or activity involving complex co-operation between people and other resources. Because of their knowledge and skills some resources are unique and can perform particular tasks more efficiently than others (see Foss and Knudsen 1996). Individual firms possess competences in unique combinations, are part of what Kay (1993a) terms the architecture of the firm and are particularly effective in given industries or markets. When these competences can be clearly identified as being at the heart of the firm and form the basis of its competitive advantage, they are termed core competences (Prahalad and Hamel 1990) these represent the collective learning of the organization that is, the know-how needed to undertake the complex tasks of organizing a particular activity. Some firms may understand the oil industry...

The First Oil Shock and Its Effects 19731975

Energy Prices and the 1974-1975 Recession. In October 1973 war broke out between Israel and the Arab countries. To protest support of Israel by the United States and the Netherlands, Arab members of the Organization of Petroleum Exporting Countries (OPEC), an international cartel including most large oil producers, imposed an embargo on oil shipments to those two countries. Fearing more general disruptions in oil shipments, buyers bid up market oil prices as they tried to build precautionary inventories. Encouraged by these developments in the oil market, OPEC countries began raising the price they charged to their main customers, the large oil companies. By March 1974 the oil price had quadrupled from its prewar price of 3 per barrel to 12 per barrel.

Possible alternatives and policy solutions

Yet, it is quite possible and indeed indispensable to educate the elite and the population in ways to see realistic alternatives to current economic policies and the dire need for them to be implemented in the national interest. One has to bear in mind that there is no unanimity on these issues at the top of the government. For instance, Vladimir Putin made quite a sensation three years ago in his State of the Nation address to parliament when he suggested redistributing mineral rent to other sectors of the economy. Following the president's initiative, some taxes were indeed raised on oil companies but these changes were relatively minor and did not resolve the major imbalance issue. One of the neo-liberal dogmas is that the state should not be involved in the economy. This may be true in countries where business is active in areas that are particularly crucial for maintaining a healthy economy. But in Russia this is not the case. For instance, the major structural imbalance between...

Changing Conditions

When the number of jobs in the American steel industry was cut from 340,000 to 125,000 during the decade of the 1980s, that had a devastating impact and was big economic and political news. It also led to a variety of laws and regulations designed to reduce the amount of steel imported into the country to compete with domestically produced steel. Of course, this reduction in supply led to higher steel prices within the United States and therefore higher costs for all other American industries that were producing objects made of steel, ranging from automobiles to oil rigs. With American manufacturers paying more than a hundred dollars more per ton of steel, and having to recover such increased costs from increased prices charged the consumers, all these products were at a disadvantage in competing with similar foreign-made products, both within the United States and in international markets.

Private Carriage of Cargo

Although there is much private carriage of passengers in aviation, counting both pleasure flying and corporation aircraft, which fly executives and other company personnel, there is relatively little private carriage of cargo. (An example of such carriage would be an oil company carrying drilling equipment or other company supplies in its own aircraft.) But in the future it is distinctly possible that there will be much more of it, as firms become aware of its advantages. It is even conceivable that someday there will be private cargo aircraft fleets much as there are now fleets of private trucks, each carrying the goods of its owner corporation.

Disc Ii Demonstration Of Isc By Way Of Intereuropean Implementation Disc Ii

RESUME - ABSTRACT THE ARCDEV PROJECT IS A SHORT SEA SHIPPING (SSS) FULL SCALE DEMONSTRATOR. IT WILL CONCENTRATE ON THE OPERATIONAL AND TECHNICAL FEASIBILITY AS WELL AS ON THE COST-EFFECTIVENESS OF A SSS CORRIDOR LINKING ALL THE YEAR ROUND THE ARCTIC REGIONS OF RUSSIA TO THE EUROPEAN UNION. THE VERIFIED OIL AND NATURAL GAS RESERVES IN NORTHERN RUSSIA AND IN THE RUSSIAN SECTOR OF THE ARCTIC OCEAN ARE VERY LARGE. THEY ARE CONSIDERED AS ONE OF THE LONG TERM ENERGY SUPPLY SOURCE OF WESTERN EUROPE. TOGETHER WITH WESTERN OIL COMPANIES AND ENGINEERING FIRMS RUSSIA IS IN THE PROCESS OF DEVELOPING TECHNOLOGIES TO PRODUCE AND SHIP MOST OF THE OIL TO WESTERN EUROPE. INSTEAD OF TRANSPORTING THE OIL BY PIPELINES THROUGH VARIOUS FOREIGN

Technical description

The technique for the drilling of geothermal wells is very similar to the drilling of oil and gas wells 10-6 . Almost exclusively, the rotary drilling technique is applied. The drilling tool is in most cases a tricone bit. The bit is rotated via the drill pipe, a steel pipe of much smaller diameter than the bit, by a rotary table in the floor of the drilling platform. The rock cuttings are transported to the surface by drilling fluid , which is pumped down through the drill pipe and ascends in the annulus between drill pipe and borehole wall. Due to the relatively large cross sectional area of this annulus high flow rates of the drilling mud are required to achieve the flow velocities necessary for transporting the rock particles. During drilling the weight of the drill pipe is hanging on a hook in the tower of the drilling rig. A string of heavy thick walled large diameter drilling collars sitting on top of the drilling bit provides the load for the support of the...

Tools For System Diagnostics

For example, global domination of very large oil companies and automobiles internal combustion engines, coupled with magnitude of petrol distribution infrastructure, strongly inhibits electric-powered transport tight bureaucratic control of further technological innovation, coupled with sanctions on outside contact, leads to stagnation in technological advancement (as in old China)

Specialization And Distribution

Prices play a crucial role in all of this, as in other aspects of a market economy. Any economy must not only allocate scarce resources which have alternative uses, it must determine how long the resulting products remain in whose hands before being passed along to others who can handle the next stage more efficiently. Profit-seeking businesses are guided by their own bottom line, but this bottom line is itself determined by what others can do and at what cost. When an oil company discovers that it can make more money by selling gasoline to local filling stations than by owning and operating its own filling stations, then the gasoline passes out of its hands and is then dispensed to the public by others. In other words, the economy . as a whole operates more efficiently when the oil company turns the gasoline over to others at this point, though the oil company itself does so only out of self-interest. What connects the self-interest of a company with the efficiency of the economy as...

The Origins Of Entrepreneurial Opportunities

Consider some great American fortunes. Andrew Carnegie was able to build the foundations of U.S. Steel by capitalizing on the newly developed Bessemer process. John D. Rockefeller's Standard Oil Company developed because he was able to control the distribution network, which at the time relied on the recently-constructed railroad infrastructure. Henry Ford's assembly lines were feasible only when there was enough of a mass market for automobiles, and the fortunes of Bill Gates rose along with the fledgling personal computer industry. None of these individuals invented the technology that made them wealthy, but they had the insight to take advantage of an entrepreneurial opportunity. Note, however, that in each case the opportunity was newly developed, and the entrepreneurial opportunity did not go unnoticed for long. Entrepreneurial opportunities are not just lying around waiting for someone to notice them. Rather, they appear and then entrepreneurs rapidly move to take advantage of...

Entrepreneurial activity as a source of entrepreneurial opportunity

Consider some great American fortunes. Andrew Carnegie was able to build the foundations of U.S. Steel by capitalizing on the newly developed Bessemer process. John D. Rockefeller's Standard Oil Company developed because he was able to control the distribution network, which at the time relied on the recently constructed railroad infrastructure. Henry Ford's assembly lines were feasible only when there was enough of a mass market for automobiles, and the fortunes of Bill Gates rose along with the fledgling personal computer industry. None of these individuals invented the technology that made them wealthy, but they had the insight to take advantage of an entrepreneurial opportunity. Note, however, that in each case the opportunity was newly developed, and the entrepreneurial opportunity did not go unnoticed for long. Entrepreneurial opportunities are not just lying around waiting for someone to notice them. Rather, they appear and then entrepreneurs rapidly move to take advantage of...

Quotas and other nontariff trade barriers

Keynsian Equlibrium

If a tariff is maintained, that area is government revenue that can be used to make public expenditures or to allow a reduction of other taxes. Under a quota, however, this tariff-equivalent revenue goes to whomever is fortunate enough to have the right to ship the product from the exporting to the importing country. If quota rights are allocated to importers, they receive the windfall profit. Suppose oil can be purchased on the world market at 1.50 per barrel and shipped to the East Coast of the United States for 0.75 per barrel for a total landed cost of 2.25 at the same time a US quota is being used to protect an internal price of approximately 3.50. Those allowed to bring oil into the United States receive a gift of 1.25 per barrel. They land oil here at a cost of 2.25, and it is immediately worth 3.50. This example represents the situation prevailing from the 1950s into the 1960s in the United States. It produced enormous monopoly rents for the...

Problems For Section 161

What would happen if the total quota were the same as in (a) but were allocated to oil companies in proportion to the amount of domestic oil they raised and refined In particular, what would happen to the domestic price of oil 6. During much of the 1970s the U.S. government imposed a great many regulations on the oil industry at various points from well to filling station. By the late 1970s foreign oil was selling for much more than old domestic oil (that is, oil from wells drilled long ago). There was a controversy about whether or not to remove the regulations, the assumption being that the price of oil products would rise to the foreign level if old wells were permitted to charge what the market would bear. True or false In view of the absence of long lines at gasoline stations or other evidence of too low a price, the removal of the regulations could well be expected to have no effect at all on prices and might well be expected to reduce, not raise, them.

The Role of Enabling Technologies

This highway analogy is relevant and helpful in understanding what the Information Superhighway signifies and how it operates. Just as the automobile sector dominates today's economic activities with its associated industries of automobile manufacturers, new and used car dealers, parts suppliers and repair shops, motel and travel services, oil companies and gas stations, insurance services, and roads and highway maintenance and administration, the new economy will revolve around the many industries

Classification of Auctions

In a private-value auction, each participant has a potentially different value for the good in question. A particular piece of art may be worth 500 to one collector, 200 to another, and 50 to yet another, depending on their taste. In a common-value auction, the good in question is worth essentially the same amount to every bidder, although the bidders may have different estimates of that common value. The auction for off-shore drilling rights described above had this characteristic a given tract either had a certain amount of oil or not. Different oil companies may have had different estimates about how much oil was there, based on the outcomes of their geological surveys, but the oil had the same market value regardless of who won the auction.

Cost Diffusion

The last explanation we present for the possibility of excessively large government is the common resource problem. The idea is that spending authorities are dispersed while the treasury has the responsibility of collecting enough revenue to balance the overall budget. Each of the spending authorities has its own spending priorities, with few consideration for others' priorities, which it can better meet by raiding the overall budget. This is the common resource problem, just like that of several oil companies tapping into a common pool underground or fishermen netting in a single lake. In all cases it leads to excess pressure on the common resource. From this perspective a single committee with expenditure authority would have a much better sense of the opportunity cost of public funds, and can better compare the merits of alternative proposals, than the actual dispersed spending authorities. The current trend toward federalism and devolution aggravates this common pool problem. The...

Statistics

Oil output accounted for about half of GDP in 2004, with the government benefiting from both tax revenues and production-sharing agreements. Oil production increased by one-third between 2001 and 2004 and is expected to reach 2 million bpd in 2007, according to the IMF. Not surprisingly, international oil companies have targeted the country, investing more than US 2 billion over 20032004.

Unes At The Gas Pump

What was responsible for the long gas lines Most people blame OPEC. Surely, if OPEC had not raised tlx- price of c rude oil. the shortage of gasoline would not have occurred. Yet economists blame L'.S. government regulatkms that limited the price oil companies could charge for gasoline.

Personnel

However in fact, I started up the first In Situ Uranium mine with almost completely untrained personnel and provided on the job training, while developing the technology so it is not so difficult for experienced supervisors and managers. At this time, I had extensive training and experience developed for working for years for major oil companies that take the time to train and educate their managers. Also, I had very good financial support. However, we lack these kinds of people, but it is a management skill not a technical skill to manage this. Certain key functions are generally available anyway. Particularly, training drilling personnel may be a limitation. We notice that there are serious training efforts underway in Kazakstan to fill the need for geologists and drilling personnel. This is an indication of the good planning by KazAtomProm and their partners. Perhaps a more interesting limitation is the lack of interest in this profession as it offers too limited an opportunity to...

Financing

In the past most uranium exploration and development was subsidized by Governments, either directly or indirectly or subsidized by financing from larger companies in related industries, such as oil or mining. Government subsidies applies to all countries at one time or another, but in some countries it still applies. However, with the recent privatization of state owned enterprises and the stopping of subsidies, it will be very difficult to make the large investment needed to get the industry to a healthy and competitive situation. The large mining and oil companies are not interested in this difficult industry as even the large projects do not provide sufficient cash flow to interest them and effect their bottom line. Especially, considering the many nuisance type problems with this industry.

Sanctions

In December 1934 a border incident occurred between Italian Somalia and Ethiopia. Italy demand an apology Ethiopia refused. With tension rising, the League of Nations sought to arbitrate but received no help from Italy. After further border clashes, Italian troops invaded Ethiopia on October 3, 1935 without a declaration of war. Later in the month, the League of Nations declared Italy the aggressor and voted sanctions to be applied to her in arms supply, finance, and export-import restrictions. The League did not, however, decree sanctions in the critical item, oil. Germany refused to comply with the League vote the United States, though not a member of the League of Nations, was strongly sympathetic. Oil sanctions were discussed again in March 1936. At this time an attempt was made to apply them informally through major world oil companies. These companies stopped selling to Italy, but the increase in oil prices thereby brought about encouraged a vast number of small shippers to...

Linearity Assumption

To illustrate, suppose that an oil company must choose the optimal output mix for a refinery with a capacity of 150,000 barrels of oil per day. The oil company is justified in basing its analysis on the 25-per-barrel prevailing market price for crude oil, regardless of how much is purchased or sold. This assumption might not be valid if the company were to quickly expand refinery output by a factor of 10, but within the 150,000 barrels per day range of feasible output, prices will be approximately constant. Up to capacity limits, it is also reasonable to expect that a doubling of crude oil input would lead to a doubling of refined output, and that returns to scale are constant.

Department Of Energy

Government officials, newspaper reports, and TV commentators regularly attribute the energy crisis to a rapacious oil industry, or wasteful consumers, or bad weather, or Arab sheikhs. But none of these is responsible. After all, the oil industry has been around for a long time

Natural Resources

Imagine if the interest rate had been twice as high on this much money borrowed from banks or investors, making the total cost of exploration even higher. Or imagine that the oil companies had this much money of their own and could put it in a bank to earn twice the usual interest in safety. Would they have sunk as much money as they did into the more risky investment of looking for oil Would you Probably not. A higher interest rate would probably have meant less oil exploration and therefore smaller amounts of known reserves of petroleum. But that would not mean that we were any closer to running out of oil than if the interest rate were lower and the known reserves were correspondingly higher.

Data sources

For Paper III, reserve and production data for individual oil sands projects have been collected mainly from oil companies and oil and gas industry journals. Governmental data and various sector reports have also been valuable sources. For Paper V, reserve and production data for the Norwegian and UK giant natural gas fields have mainly been gathered from the Norwegian Petroleum Directorate and from the UK Department of Energy and Climate Change. Future production plans for individual fields have been found in various oil industry news media as well as from the companies involved in developing the fields, such as StatoilHydro, etc. For Paper VI, field specific data on giant gas fields has been gathered from a variety of sources such as scientific literature, governmental reports, geological reports, peer-reviewed articles, oil and gas industry journals, bond loans prospectus for the financial markets, Gazprom and its development partners, independent gas producers and international...

Price indicators

Oil producers can be divided into three groups opec, the former communist bloc and what the oil industry has traditionally called the free world. Oil output in the free world is price-responsive it becomes profitable to extract oil from marginal fields only when prices are high. Within such considerations the free world normally produces oil flat out. The gap between demand and supply is therefore filled by opec crude. The organisation's attempts to control the world petroleum markets led to oil price rises in 1973 and 1979 and a sharp slump in 1986. In the past, world market sales from producers in the former Eastern bloc did not fluctuate wildly, but are now rising annually. Stocks. Whereas almost all the gold ever produced is still in existence (even if some is in orbit or on the sea bed), oil is rapidly consumed. Oil companies and some governments hold working and strategic stocks which help to prevent prices rocketing in times of temporary crisis, such as during the Iraqi...

Trickle Down Theory

Even with successful and well-established businesses, years may elapse between the initial investment and the return of earnings. From the time when an oil company begins spending money to explore for petroleum to the time when the first gasoline resulting from that exploration comes out of a pump at a filling station, a decade may have passed. In the meantime, all sorts of employees have been paid-geologists, engineers, refinery workers, truck drivers. It is only afterwards that profits begin coming in. Only then are there any capital gains to tax. The real effect of a reduction in the capital gains tax is that it opens the prospect of greater future net profits and thereby provides incentives to make current investments. Nor is the oil industry unique. No one who begins publishing a newspaper expects to make a profit-or even break even-during the first year or two. But reporters and other members of the newspaper staff expect to be paid every payday, even while the paper shows only...

Demand

When demand shifts from growing to long-term decline, rather than short-term decline, the turning point may be difficult for managers to recognize. For example, the European oil industry experienced rapid growth from the end of the Second World War for the next 30 years. In the 1970s oil companies were making plans to expand refinery capacity in line with previous experience. However, the trebling of the crude oil price in 1973-1974 had adverse short-run effects on demand this was treated as a short-term downturn in response to the higher prices and recession that followed. No one at the time recognized this as a turning point. Most oil company managers envisaged that demand growth would resume in due course. In reality, the demand for oil entered a period of long-run decline masked by occasional upturns in demand -false heralds of resumed growth, which did not resume until the 1990s.

Oligopoly

Supernormal Profits Oligopoly

By varying supply to a market an oligopolist can also influence price. Thus, in the international oil industry the withdrawal of supply by the larger producers, such as Saudi Arabia, can significantly influence the market price. Dominant oligopolists have market power but must also be aware of the reactions of their smaller rivals. Since conjecture about how other firms might or might not respond to a particular action can vary, it opens up the possibilities of developing various oligopoly models with different consequences for pricing behaviour.

Antitrust Laws

Despite such economies of scale, the government took action against the Morton Salt Company in the 1940s for giving discounts to buyers who bought carload lots of their product. Businesses that bought less than a carload lot of salt were charged 1.60 a case, those who bought carload lots Were charged 1.50 a case, and those who bought 50,000 cases or more in a year's time were charged 1.35. Because there were relatively few companies that could afford to buy so much salt and many more that could not, the competitive opportunities of certain merchants were injured, according to the Supreme Court, which upheld the Federal Trade Commission's actions against Morton Salt. The government likewise took action against the Standard Oil Company in the 1950s for allowing discounts to those dealers who bought oil by the tank car. The Borden company was similarly brought into court in the 1960s for having charged less for milk to big chain stores than to smaller grocers. In all these cases, the key...

Law And Order

A study by the World Bank concluded that across countries there is evidence that higher levels of corruption are associated with lower growth and lower levels of per capita income. In India, for example, as an Indian business executive put it, the entrepreneur there has to bribe from twenty to forty functionaries if he is serious about doing business. During czarist Russia's industrialization in the late nineteenth and early twentieth centuries, one of the country's biggest handicaps was the widespread corruption in the general population, in addition to the corruption that was rampant within the Russian government. Foreign firms which hired Russian workers and even Russian executives made it a point not to hire Russian accountants. This corruption continued under the Communists and has become an international scandal in the post-Communist era. One study pointed out that the stock of a Russian oil company sold for about one percent of what the stock of a similar oil company would sell...

Figure 165

Imagine that two oil companies Exxon and Arco own adjacent oil fields. Under the fields is a common pool of oil worth 12 million. Drilling a well to recover the oil costs 1 million. If each company drills one well, each will get half of the oil and earn a 5 million profit ( 6 million in revenue minus 1 million in costs).