We had a chat about this in one of my lectures today. There was a great comment made. If there is to be a tax on super profits, why should the mining industry be targeted? Isn't it only fair that any company with super profits, in any industry, would have to pay the higher rate of tax?
Just something to think about, I'm off to study.
About Me
- andy
- I'm like any other uni student. I like clubbing, parties with friends and surfing if I can get a chance. I grew up in Townsville and miss my great friends there, the strand and maggie, but I still get time to have fun in brissie. I'm studying Civil and Construction Engineering at QUT, and I'm finding it a lot more interesting than most people would think. I'm also doing a mining minor at UQ at the same time so that I can work in the mining industry. I hope to work on mine sites once I graduate, because I love the friendliness in small towns, and it's always more fun to brag about being involved in massive projects. Drop me an email at andrea.dale@connect.qut.edu.au if you want to know more :)
Monday, May 31, 2010
Wednesday, May 12, 2010
News
So there has been a fair bit of bad news at the moment in the resources industry. Aside from the Super Tax which affects Australia, there are some tragedies that dwarf the issue of the tax.
The most recent was a methane gas explosion (or two actually) in an underground coal mine in Russia. The area was known for bad mining practices, but it's still a terrible thing to happen. It shows why ventilation is such a big deal in underground mines, especially coal where there is methane gas around. Apparently what happened is that the rescue teams went in after the first explosion, then the second explosion happened in which many of them were killed. Check out this link if you want to know more:
http://edition.cnn.com/2010/WORLD/europe/05/12/russia.mine.blast/
Another thing is the Deepwater Horizon Drilling Rig in the Gulf of Mexico. What really annoys me about this is that everyone is only mentioning the environmental damage it is causing. I admit that is a big problem, but everyone seems to forget (or hardly ever mentioned) that workers died when the rig caught fire. The companies are currently playing the blame game, trying to figure out who is at fault. There is a really good article that I was sent which explains what actually happened. I think that is a bigger issue than the environmental damage, or who is to blame. If we can figure that out, hopefully we can stop it happening in the future. I'll try and copy the article below.
You may have heard the news in the last two days about the Deepwater Horizon drilling rig which caught fire, burned for two days, then
sank in 5,000 ft of water in the Gulf of Mexico. There are still 11 men missing, and they are not expected to be found.
The rig belongs to Transocean, the world’s biggest offshore drilling contractor. The rig was originally contracted through the year 2013 to
BP and was working on BP’s Macondo exploration well when the fire broke out. The rig costs about $500,000 per day to contract. The full
drilling spread, with helicopters and support vessels and other services, will cost closer to $1,000,000 per day to operate in the course of
drilling for oil and gas. The rig cost about $350,000,000 to build in 2001 and would cost at least double that to replace today.
The rig represents the cutting edge of drilling technology. It is a floating rig, capable of working in up to 10,000 ft water depth. The rig is
not moored; It does not use anchors because it would be too costly and too heavy to suspend this mooring load from the floating
structure. Rather, a triply-redundant computer system uses satellite positioning to control powerful thrusters that keep the rig on station
within a few feet of its intended location, at all times. This is called Dynamic Positioning.
The rig had apparently just finished cementing steel casing in place at depths exceeding 18,000 ft. The next operation was to suspend the
well so that the rig could move to its next drilling location, the idea being that a rig would return to this well later in order to complete the
work necessary to bring the well into production.
It is thought that somehow formation fluids – oil /gas – got into the wellbore and were undetected until it was too late to take action. With a
floating drilling rig setup, because it moves with the waves, currents, and winds, all of the main pressure control equipment sits on the
seabed – the uppermost unmoving point in the well. This pressure control equipment – the Blowout Preventers, or ‘BOP’s” as they’re
called, are controlled with redundant systems from the rig. In the event of a serious emergency, there are multiple Panic Buttons to hit,
and even fail-safe Deadman systems that should be automatically engaged when something of this proportion breaks out. None of them
were aparently activated, suggesting that the blowout was especially swift to escalate at the surface. The flames were visible up to about
35 miles away. Not the glow – the flames. They were 200 – 300 ft high.
All of this will be investigated and it will be some months before all of the particulars are known. For now, it is enough to say that this
marvel of modern technology, which had been operating with an excellent safety record, has burned up and sunk taking souls with it.
The well still is apparently flowing oil, which is appearing at the surface as a slick. They have been working with remotely operated
vehicles, or ROV’s which are essentially tethered miniature submarines with manipulator arms and other equipment that can perform work
underwater while the operator sits on a vessel. These are what were used to explore the Titanic, among other things. Every floating rig
has one on board and they are in constant use. In this case, they are deploying ROV’s from dedicated service vessels. They have been
trying to close the well in using a specialized port on the BOP’s and a pumping arrangement on their ROV’s. They have been unsuccessful
so far. Specialized pollution control vessels have been scrambled to start working the spill, skimming the oil up.
In the coming weeks they will move in at least one other rig to drill a fresh well that will intersect the blowing one at its pay zone. They will
use technology that is capable of drilling from a floating rig, over 3 miles deep to an exact specific point in the earth – with a target radius
of just a few feet plus or minus. Once they intersect their target, a heavy fluid will be pumped that exceeds the formation’s pressure, thus
causing the flow to cease and rendering the well safe at last. It will take at least a couple of months to get this done, bringing all available
technology to bear. It will be an ecological disaster if the well flows all of the while; Optimistically, it could bridge off downhole.
It’s a sad day when something like this happens to any rig, but even more so when it happens to something on the cutting edge of our
capabilities. The photos that follow show the progression of events over the 36 hours from catching fire to sinking.
There are a heap of photos with it, which I am happy to send to anyone who wants to have a look.
The most recent was a methane gas explosion (or two actually) in an underground coal mine in Russia. The area was known for bad mining practices, but it's still a terrible thing to happen. It shows why ventilation is such a big deal in underground mines, especially coal where there is methane gas around. Apparently what happened is that the rescue teams went in after the first explosion, then the second explosion happened in which many of them were killed. Check out this link if you want to know more:
http://edition.cnn.com/2010/WORLD/europe/05/12/russia.mine.blast/
Another thing is the Deepwater Horizon Drilling Rig in the Gulf of Mexico. What really annoys me about this is that everyone is only mentioning the environmental damage it is causing. I admit that is a big problem, but everyone seems to forget (or hardly ever mentioned) that workers died when the rig caught fire. The companies are currently playing the blame game, trying to figure out who is at fault. There is a really good article that I was sent which explains what actually happened. I think that is a bigger issue than the environmental damage, or who is to blame. If we can figure that out, hopefully we can stop it happening in the future. I'll try and copy the article below.
You may have heard the news in the last two days about the Deepwater Horizon drilling rig which caught fire, burned for two days, then
sank in 5,000 ft of water in the Gulf of Mexico. There are still 11 men missing, and they are not expected to be found.
The rig belongs to Transocean, the world’s biggest offshore drilling contractor. The rig was originally contracted through the year 2013 to
BP and was working on BP’s Macondo exploration well when the fire broke out. The rig costs about $500,000 per day to contract. The full
drilling spread, with helicopters and support vessels and other services, will cost closer to $1,000,000 per day to operate in the course of
drilling for oil and gas. The rig cost about $350,000,000 to build in 2001 and would cost at least double that to replace today.
The rig represents the cutting edge of drilling technology. It is a floating rig, capable of working in up to 10,000 ft water depth. The rig is
not moored; It does not use anchors because it would be too costly and too heavy to suspend this mooring load from the floating
structure. Rather, a triply-redundant computer system uses satellite positioning to control powerful thrusters that keep the rig on station
within a few feet of its intended location, at all times. This is called Dynamic Positioning.
The rig had apparently just finished cementing steel casing in place at depths exceeding 18,000 ft. The next operation was to suspend the
well so that the rig could move to its next drilling location, the idea being that a rig would return to this well later in order to complete the
work necessary to bring the well into production.
It is thought that somehow formation fluids – oil /gas – got into the wellbore and were undetected until it was too late to take action. With a
floating drilling rig setup, because it moves with the waves, currents, and winds, all of the main pressure control equipment sits on the
seabed – the uppermost unmoving point in the well. This pressure control equipment – the Blowout Preventers, or ‘BOP’s” as they’re
called, are controlled with redundant systems from the rig. In the event of a serious emergency, there are multiple Panic Buttons to hit,
and even fail-safe Deadman systems that should be automatically engaged when something of this proportion breaks out. None of them
were aparently activated, suggesting that the blowout was especially swift to escalate at the surface. The flames were visible up to about
35 miles away. Not the glow – the flames. They were 200 – 300 ft high.
All of this will be investigated and it will be some months before all of the particulars are known. For now, it is enough to say that this
marvel of modern technology, which had been operating with an excellent safety record, has burned up and sunk taking souls with it.
The well still is apparently flowing oil, which is appearing at the surface as a slick. They have been working with remotely operated
vehicles, or ROV’s which are essentially tethered miniature submarines with manipulator arms and other equipment that can perform work
underwater while the operator sits on a vessel. These are what were used to explore the Titanic, among other things. Every floating rig
has one on board and they are in constant use. In this case, they are deploying ROV’s from dedicated service vessels. They have been
trying to close the well in using a specialized port on the BOP’s and a pumping arrangement on their ROV’s. They have been unsuccessful
so far. Specialized pollution control vessels have been scrambled to start working the spill, skimming the oil up.
In the coming weeks they will move in at least one other rig to drill a fresh well that will intersect the blowing one at its pay zone. They will
use technology that is capable of drilling from a floating rig, over 3 miles deep to an exact specific point in the earth – with a target radius
of just a few feet plus or minus. Once they intersect their target, a heavy fluid will be pumped that exceeds the formation’s pressure, thus
causing the flow to cease and rendering the well safe at last. It will take at least a couple of months to get this done, bringing all available
technology to bear. It will be an ecological disaster if the well flows all of the while; Optimistically, it could bridge off downhole.
It’s a sad day when something like this happens to any rig, but even more so when it happens to something on the cutting edge of our
capabilities. The photos that follow show the progression of events over the 36 hours from catching fire to sinking.
There are a heap of photos with it, which I am happy to send to anyone who wants to have a look.
Tuesday, May 11, 2010
Super Tax
I've realised it's been ages since I've posted anything. Uni is pretty busy, but of course I should say something on the Super Tax. It really does annoy me, but I don't think that anyone knows much about it yet. One interesting thing is that it won't come into effect until late 2011, or legislation won't be introduced until then. That's when I graduate!! I guess I'll be looking forward to that time for graduation, but I really hope the Super Tax is changed (from how I understand it works). There's an interesting publication here that seems unbiased:-
http://www.ey.com/Publication/vwLUAssets/Resources_Super_Profit_Tax/$FILE/Mining_Pub_Resources_Super_Profits_Tax.pdf
From what I've seen of K Rudd (Why didn't we ever refer to J Horward like a rapper?) on the news while this was being announced, it seems like an unplanned idea that just slipped out. His point seemed to be that he was going to create heaps of money in the budget, by making sure it didn't go overseas with some offshore ownership of mining companies. His example, I think, was BHP - about 50-60% offshore ownership? My memory is pretty bad. This doesn't take into account how it will hurt Aussie investors, the economy and workers. To be honest, I doubt that offshore investors will be hurt by this, more likely that Aussie workers will lose their jobs. I'm just going off the media releases by Rudd, but this could be really damaging to the Australian economy. I hope I've got it wrong. I hope the government isn't just trying to leech more money out of something they already suck plenty out of. I guess I don't have a high regard for politicians when they are focussed on getting money to buy their next election.
Either way, it's a pretty big issue in the mining industry at the moment.
I only have 4wks of lectures to go until exams, and lots of 21st's as well (including my own), so it's about time i got stuck into uni work again.
http://www.ey.com/Publication/vwLUAssets/Resources_Super_Profit_Tax/$FILE/Mining_Pub_Resources_Super_Profits_Tax.pdf
From what I've seen of K Rudd (Why didn't we ever refer to J Horward like a rapper?) on the news while this was being announced, it seems like an unplanned idea that just slipped out. His point seemed to be that he was going to create heaps of money in the budget, by making sure it didn't go overseas with some offshore ownership of mining companies. His example, I think, was BHP - about 50-60% offshore ownership? My memory is pretty bad. This doesn't take into account how it will hurt Aussie investors, the economy and workers. To be honest, I doubt that offshore investors will be hurt by this, more likely that Aussie workers will lose their jobs. I'm just going off the media releases by Rudd, but this could be really damaging to the Australian economy. I hope I've got it wrong. I hope the government isn't just trying to leech more money out of something they already suck plenty out of. I guess I don't have a high regard for politicians when they are focussed on getting money to buy their next election.
Either way, it's a pretty big issue in the mining industry at the moment.
I only have 4wks of lectures to go until exams, and lots of 21st's as well (including my own), so it's about time i got stuck into uni work again.
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