Troy Holmes' Blog

This blog, http://www.economist.com/node/14548839, on The Economist, explained how economic downturn and other factors of Mexican policy has led to a decrease in oil production from Latin America’s biggest producer.

Apart from the fact that all of Mexico is feeling the effects of the present American Economy, Mexican government policy has also hurt the monopolized oil industry in Mexico. The article outlines the fact that Mexico, the seventh largest oil producer in the world, could very well be an net importer very soon, if policy and actions of Pemex (Mexico’s oil company, with monopoly power and control) are not changed. This would be a huge shake to the Mexican people and the country, as it would drive taxes up and morale down. The article claims that Pemex is somewhat outdated in its practice, by not reaching the oil fields well below the surface of the Gulf of Mexico, or properly calculating its future projects’ outcomes.

I agree with the article that this monopoly that was created years ago, has led to the downturn and inability for Mexico to properly take advantage of its oil resources. If this industry was made public, then privately owned corporations could very well enter the Mexican market with expertise and could supply Mexico with payments and compensations that they would never receive due to lack of extraction of this oil. Clearly this topic is very complicated, and their are numerous ways to handle it, I believe this article really states the consequences that will come if no change is made, the trillion dollar question (literally), is what change to make.

In the recent economy, small farms across America are turning to different routes to ensure a successful year, as the weather and economic patterns are unpredictable. With this instability, farms have turned to tourism. They have converted parts of their ranches into Bed and Breakfasts, hold ranch tours and provide horseback riding. I found this to be a genius idea. Middle class families are always trying to find new ways to travel, and with struggling times, local vacations are very popular. These small farms have capitalized on this opportunity, by attracting families of all ages to their ranches. If I were a farmer and had the ranch to provide such an attraction I would certainly do so. Family vacations are much more dependable than the weather. Farms need this insurance that tourism provides. Some may say that tourism has fell in recent times, this is true, but tourism to far away locations. Local tourism has prospered in the struggling economy, these ranches and small farms are an example of this and I am very impressed with their ingenuity.

http://www.nytimes.com/2011/06/10/business/10tourism.html?ref=smallbusiness

Recently, Brazil has implemented itself into the top 4 oil producers in the world. Since the 1950s, Petrobras, the national oil company of Brazil, has explored and found oil in waters offshore Brazil and in fields deep underneath Brazilian soil. Until recently, spending has been moderate, but the discovery of massive fields deep underwater and far offshore mainland Brazil has made spending on this industry skyrocket. Brazil has always been a big player in energy, but now has surpassed Mexico and Venezuela with its expenditures. But this expansion has its sceptics, the underwater field is so far offshore that it will require a midway station to be built, for reasons of emergencies, they will be close enough to reply. To me, this is a bit of a red flag, with the recent BP Gulf Coast disaster. Deep water oil exploration is a phrase that is accompanied by a huge black cloud, with good reason. They have never been completely proven to be as safe as normal land explorations. To me, these types of explorations should be closely monitored and the fact that they need a halfway house to the oil rig is reason for much concern. I understand where Brazil is coming from with their expansion but there has to be some point when a line is drawn.

http://www.nytimes.com/2011/10/11/business/energy-environment/in-brazil-energy-finds-put-country-at-a-whole-new-power-level.html?pagewanted=2&_r=1

SEI Industries, a company from Delta, British Columbia, recently released its most innovative product; a cost saving fuel transport bladder that has air cargo companies around the globe buzzing about the product. The BATT (Bulk aviation transport tank) will be used in such fuel transport operations like in warfare and, more locally, for delivering fuel to the mining boom in Northern BC.  SEI Industries is a leader in this market, with sales to places such as Columbia and more recent demand coming from across the globe. It is reassuring to know that there are more companies from Canada that are innovative other than RIM and Bombardier. SEI is relatively unknown to Canadians, myself included, yet it has some inventions that are used around the globe. Its most famous one is the Bambi Bucket, which is famously used by helicopters in order to combat wildfires, is used in every corner of the globe. SEI Industries should be proud of itself, and should get more recognition for its globally utilized products.

http://www.vancouversun.com/business/Delta+firm+portable+diesel+bladder+fuels+mining+exploration/5529041/story.html

Liquefied Natural Gas has been Alberta’s main energy export for years, which is eye opening to most, as the oil sands are so well talked about. Even though the oil pipelines proposed to be built from Alberta to the BC Coast (TransCanada’s Keystone XL pipeline and Enbridge’s Northern Gateway pipeline) are still slow to be processed and approved; the Kitimat LNG Project is already underway. It will be a line that will connect the natural gas reserves in Alberta, to Asia, with the main port being Kitimat, BC. This is a pipeline in very high demand, as its main customer will be China, the fastest growing and most profitable economy of modern day. The local Kitimat native tribe is very excited about the pipeline, as it will improve the city’s economy. I was very surprised to find out that Natural Gas is still more profitable and important than oil is Alberta. Also, the pipeline is very similar to those proposed by the oil companies, which doesn’t make sense to me as the oil pipelines are so controversial. They both pose environmental problems yet one has successfully flown under the radar, while the other one has caused uproar and huge debates. This is confusing and makes me wonder what the reason for these pipelines to have such different viewpoints with them, even though they are very similar in environmental damage and risk.

http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/kitimat-bc-ground-zero-in-the-race-to-fuel-asia/article2195213/

Monsanto Co. claims to be the world’s leader in innovative crop growing.This means that they use genetically engineered seeds to mass produce their crops. This isn’t unethical on any means. But when they have to compete with the “Organic” market (farms that don’t use chemicals or pesticides) Monsanto Co. gets scared. They are incredibly infamous for aimlessly suing smaller organic farms for no apparent reason other to cripple them financially with the legal costs that there lawsuit brought upon the smaller company. These lawsuits are a win-win situation for Monsanto Co.. Either they win the lawsuit, which is rare as their arguments are usually absurd, or they lose but in the meantime of the trial, they eliminate the smaller competition by bankrupting them. Monsanto Co. holds much of its crops in third world countries, where they can use harmful unregulated chemicals and pesticides that aren’t outlawed in these areas, but pose huge health risks. This isn’t illegal to do, although it is highly unethical and unfair to any smaller farms that cross Monsanto Co.. Apparently, Monsanto Co. is unaware of business ethics in general, but what they are doing, although cruel and a massive health risk, is perfectly legal.