From The President
by Dave Rensink
Statistics and Other Marginally Useful Information
We in the petroleum industry tend to forget that there are other extraction industries in Texas. That was recently brought home to me when my wife mentioned that she heard on the radio that Texas is one of the biggest producers of lignite coal in the United States. My immediate retort was, “that can’t be right.” After all, when was the last time you saw a coal mine in Texas? If I had asked you to bet on how much coal Texas produced, you would have won if you picked any number over zero. The fact is that Texas is THE LARGEST producer of lignite coal in the United States. Texas is also the fifth largest coal producer overall behind Wyoming, West Virginia, Kentucky and Pennsylvania. Most of it comes from 3- to 10-foot seams in the Wilcox Group in east and southeast Texas. It is probably no surprise that approximately 98% of the lignite is used to generate electricity in Texas. We also have the distinction of being the largest consumer of coal in the United States, nearly all of which is used for electric power generation.
Did you know Texas generates approximately 10% of the total US electric power? In fact, Texas is the biggest electricity generator of the fifty states. We produce nearly 70% more electricity than Florida and twice as much as Pennsylvania and California. We are also the largest consumer of electric power, followed by California and Florida. Texas may be a net exporter of electricity, but in 2003, we consumed nearly as much as we produced. We are the second most populous state behind California and ahead of New York and Florida. Texas has 7.6% of the US population, yet we consume almost 10% of the electricity. We are the largest consumer of electricity in all three categories-residential, commercial and industrial. It may be possible to point to economic reasons for our disproportionate consumption of electricity, but I would bet the real culprit is the environment. Air conditioning is virtually essential to our well-being and the quality of life in Texas, but it comes at a cost.
In the vein of other lesser known facts about Texas minerals (at least known by me), the following is from the Bureau of Economic Geology. Based upon USGS estimates of the quantities of minerals produced in the fifty states in 2003, Texas continued to be first in crushed stone and second in portland cement, construction sand and gravel, salt, common clays, gypsum, talc and zeolites.
HGS is an affiliated society of AAPG, but that does not mean we cannot serve the minerals side of the business. We have already established special interest groups in international and North American exploration, environmental and engineering geology, and neogeos. If there is sufficient interest, there is every reason that a minerals exploration group could also be established. All we need are interested participants and volunteers to organize the meetings. If we have a minerals constituency that believes it is not being served with the current organizational structure of HGS, let me know. I am confident the board would support the organizational efforts of any group that feels it has been marginalized. In the words of a former Louisiana politician, “Le me hep ya.”
As long as we are dealing with statistics, here are some that I did know and that ought to concern us all. The country with 4.6% of the world’s population consumes 24.7% of world’s oil pro- duction and 23.4% of its natural gas production. That same country only produces 42% of is crude oil requirements. That means we import 12 million barrels of oil every day. Fortunately, we do produce 85% of the natural gas we consume. The balance of our natural gas needs is imported from Canada. At current product prices, we are exporting approximately 790 mil- lion dollars per day ($660 million for oil and $130 million for natural gas). That is about a third of our total trade deficit.
If you are sitting on a pile of US dollars and you do not live in the United States, there is not much you can do with them besides buy US goods, services, companies and real estate or US treasury securities. It probably is no surprise to anyone that in September 2005, $2.066 trillion of US debt was in foreign hands (that is 26% of the total US debt), but it may surprise you to know where most of it was located. Japan held 33.3%, mainland China held 12.2%, the UK held 8.8%, and Caribbean banking centers held 5%. Surprisingly, OPEC is down the list at 2.6%.
The Caribbean banking centers held $103 billion of US debt instruments in September 2005. During the first nine months of 2005, their holdings (whoever “they” are) have ranged from $94 to $125 billion. Also during the first nine months of the year, the total debt held by foreign entities has risen by $156 billion. Beyond the fact that these are mildly interesting statistics, what is the point? A macro-economist would probably say that we are part of global economy and there is no point. I take the view that money seems to be one of our biggest exports, and in the not too distant future, the United States will no longer be owned by Americans. That thought scares me more than the potential worst-case consequences of global climate change.
Do not forget to check the February and March meeting schedule on the HGS Website.