STRATEGIC IMPLICATIONS
FUEL EMULSIONS WITHOUT ADDITIVES: THE STRATEGIC IMPLICATIONS FOR THE UNITED STATES
By: Charles P. Lickson, President/CEO COTEFCO Corporation
"Our addiction to oil is a threat to our national security..."
President George W. Bush - CNN. April 22, 2006
Even the most conservative observers of American business, industry and society are warning people in the United States and elsewhere that fossil fuel supplies-primarily oil-can reach an end point in the next two decades.
As noted in other recent comments:
"Above all, and most immediately, we face the end of the cheap fossil fuel era...we ceased paying attention to the essential nature of these miraculous gifts from the earth: that they exist in finite, nonrenewable supplies, unevenly distributed around the world."
Kunstler, The Long Emergency, 2005
"The Energy Department released a new projection Monday that forecasts oil prices will remain well above $50 a barrel for years to come..."
U.S.A. Today, Dec. 13, 2005
In mid 2006 oil was heading for $75/barrel and while there has been some variation in the per gallon price, no dramatic reduction in price is in sight for the next several years according to reports from the U.S. Department of Energy made public in May, 2006.
Even when oil prices do drop, foreign suppliers take quick steps to raise prices.
In the Fall of 2006, as oil prices began to drop, OPEC made clear its intention to reduce output. The first announcement in mid-October noted that production was to be cut by 1.2 million barrels a day. The cut in production was a response to oil prices which had dropped more than 25% since mid-July.
Some OPEC members noted they were open to further production cuts. (Associated Press-October 20, 2006).
"Dependency on petroleum is probably the most significant {threat to U.S. military and economic power} particularly that the majority of known reserves lie in regions of the world that are outside of our borders and in regions that are politically unstable."
LTC Thomas Koger, USMC (Ret) in Military Officer Magazine, March, 2006
Many Americans do not realize that the United States provides less than half of the oil consumed in the United States (Approximately 48% is currently produced in the U.S.). Among other significant suppliers of oil to the U.S. are:
| Saudi Arabia | Approximately 7% |
| Nigeria | Approximately 6% |
| Venezuela | Approximately 7.5% |
| Mexico | Approximately 7.9% |
| Canada | Approximately 11% |
(Source: CNN Reports, April 22, 2006)
Expectations of increasing oil supply from Iraq have not materialized yet. Iran and Russia are major suppliers of oil but not to the United States. Political strife and labor problems can show or stop foreign oil production. In October, 2006 distraught locals in Nigeria forced curtailing of output from both Shell Oil and Chevron. A local uprising of disgruntled people closed Shell Oil facilities in rural Nigeria claiming big oil was unfairly exploiting local workers (NPR, October 27, 2006).
President Bush has noted that "we get a lot of oil from places that are unstable". Even some "reliable" resources seem challenged from time to time as witnessed by the Summer 2006 British Petroleum ("BP") problems in pipeline delivery from the Alaska North Slope.
In Summer, 2006 ("BP") announced that it was suspending production at its Alaska facility due to problems with the pipeline. BP's Alaska operations account for approximately 8% of U.S . domestic oil production. The loss of this oil resource and an impact on U.S. oil supply and price according to news reports. (CNN, August 7,2006)
Even as North Slope oil cam back online for BP, the limits and vulnerability of U.S. domestic oil production stirred additional concerns about such total reliance on oil.
Dependence on foreign oil is not just an inconvenience, it also poses potential national security risks both to the stability of the U.S. economy and military fuel needs in the event of a national emergency. A major component of America's international trade deficit relates to costs for oil or other energy products According to the Wall Street Journal "The U.S. shortfall in oil accounts for 30% of the total trade deficit" September 21, 2006 p.C1)
Data about the actual fuel needs of the U.S. military (Army, Navy, Marines, Air Force and Coast Guard) is information not readily available for security reasons; however it is quite obvious that the mobility of the U.S. forces on land, air and sea is now almost totally reliant on refined oil. It is unpleasant-if not frightening-to imagine what effect a serious reduction in oil availability might have to both military and emergency response capability of the United States.
The House of Representatives (United States Congress) held hearings on May 5, 2006 by its House Energy Committee. Among opening remarks by House Committee members, attention was called by all Members-regardless of political affiliation-to the urgency of the United States oil dependency situation. While some party politics were apparent (Republicans favoring a look at the supply side issues while Democrats looked at demand), a highlight for this observer was the comment from Rep. Mike Rogers (Republican from Michigan) that "you can't make a fat person skinny by supplying him with a smaller pant size." He was referring presumably to a lot of the assumptions and presumptions being made by politicians and others about keeping a connection to reality in the discussions, debate and discourse.
Even as we look at total energy supplies (petroleum, coal, nuclear, etc.), U.S. demand for energy may exceed supply within 10 years. Demand is reported growing at a tare of over 7% per year. (Source: CNN, October 16, 2006).
Not a day goes by that Americans and others do not hear about the pollution of our environment or global warming caused by fossil fuels and their dwindling resources. As we search for alternative means of producing cleaner, more abundant energy, we live in a world whose infrastructure is still geared to fossil fuels. Even when a universally accepted new source of energy is found, it will still take a very long time to convert to it. So, in the interim it becomes an issue of national security for the U.S. (and many other nations) to stretch our existing resources.
Scott McClellan, President George W. Bush's former Press Secretary said it clearly at his last White House Press Conference in May, 2006: "There is no silver bullet on domestic oil needs."
Closely related to fuel supply issues, are the challenges of environmental concerns as they relate to energy production. Exhaust or stack emissions (especially oxides of nitrogen - NOx) are no longer just a local issue as more international regulations come into effect. Surprisingly, the United States is still quite lenient when compared to the European Union and some emerging Eastern Bloc countries. The U.S . can only expect emissions requirements to become more stringent as energy consumers are held accountable globally.
While much publicity and "do-good" lip service is being expended by existing fuel suppliers and various governments, the emergence of so-called "synthetic" fuels, "hybrid" engines and "alternative" energy sources seems to be a slow, many-obstacled process. According to a Bloomberg Financial report published in September, 2006 the world needs to spend $1 trillion a year in alternative fuels to be prepared to replace oil resources which are estimated to peak in 5-10 years. This economically significant warning form the U.S. Department of Energy alerts governments and others to begin to spend these funds starting 20 years before the peak in conventional oil production.
In the United States (according to the U.S. Department of Energy), conventional oil production peaked in Texas in 1972 and in all of North America in 1985. Even if alternative energy sources were readily available, the number of engines burning oil of all grades, in the U.S. (both private and public sector) is a staggering amount.
Further, with the experience in the Summer of 2006 of energy prices going up at almost dramatic and unpredictable rates, many industries and communities are looking to establish back-up or peaking-period capability on their own. Much of this new back-up effort will be directed to power generators burning diesel and other grades of oil.
New oil fields and the yield from known fields is not expected to keep up with the demand from current major consumer nations like the United States and the European Union states-much less provide for energy consumption growth in new economic giants such as China and India.
Among the known and acceptable technologies for reducing dangerous levels of NOx emissions is the increased usage of so-called "emulsion fuels". To date, the emulsion fuels have been created by adding water and chemical stabilizers to oil. In fact, it has been suggested that to offset the loss by peaks in the world oil supply, "unconventional oil" will need rapid development. (Horsch Report, Science Applications International Report.)
COTEFCO Corporation supplies proprietary water-in-oil fuel emulsion equipment that uses no additives. By creating emulsion fuel mechanically - without additives, COTEFCO eliminates the costs of the additive, storage and transportation of additive, costs for additive mixing equipment and the chemical reaction and environmental effects of burning fuel with additive chemicals as a key component.
COTEFCO expects its "Emulsion to Combustion"T ("E2C"T) technology to afford both substantial savings in fuel usage and in emissions reduction. E2C devices being fabricated by the COTEFCO directly or through collaborative relationships, also can create substantial extension of existing and future oil resources by both increasing efficiency and replacing a portion of the oil with water. In the future, COTEFCO will be looking to add coal (in abundant supply in the United States) to its fuel emulsion know-how.
Ongoing tests conducted by COTEFCO in the presence of outside observers in both the United States and in the Bahamas (home the technology's inventor Eric W. Cottell) demonstrate both emissions reduction and fuel savings-without reduction in engine or boiler performance. Exact fuel savings realized from using the COTEFCO proprietary E2C technology is determined by the grade of fuel to be used and the existing efficiency rating of the engine or boiler, however, field trials of the COTEFCO equipment to date have yielded fuel savings in from 5 to 15% (as well as reduced pollution).
When looked at in the context of America's over-all fuel consumption, a savings of 5% (or more) represents the supply equivalent of a major new oil field discovery or fuel resource-and it is avail...able now without the need for adding huge additional energy resources and funding to bring it to market. COTEFCO fuel emulsification equipment can be delivered now or in the near term for a range of flow-through applications (from 50 to 400 gallons or more per hour).
Charles Lickson is a former practicing attorney, now a professional mediator and businessman. He has doctorates in both law and counseling. He is the author of 6 books including the popular IRONING IT OUT: SEVEN SIMPLE STEPS TO RESOLVING CONFLICT and the recent: NEGOTIATION BASICS. His involvement with Cottell-invented technology in fuel emulsion goes back thirty years.
For additional information on the COTEFCO E2C water-in-fuel, no additive emulsification equipment, Contact Charles Lickson or another Staff Member from COTEFCO at:
(540) 622-2828, info@cotefco.com or www.cotefco.com
| 
