Friday, February 2, 2007

Exxon

Exxon Mobil made a profit this year of $39.5 billion. That is about 108 million in profit every day. A spokesperson for Exxon reminded us that they have to spend approximately $20 billion per year in exploration and development every year, be it good times or bad.

The impression this gives the average American is that profit was not really $39.5 billion because they have to spend $20 billion on exploration and development. Indeed that was my first reaction when I heard the statement.

In reality, this means that Exxon's profit would have been $59.5 billion had they not spent $20 billion on exploration and development. I am suddenly less sympathetic.

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In other Exxon news, it turns out that the American Enterprise Institute, funded in part by Exxon, is paying up to $10,000 for anyone who can poke holes in the United Nations global warming report.

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Update: It turns out that Exxon bought back $25 billion of it's own stock this year. If they had not done that, their profit stands at $64.5 billion.

2 comments:

mdkimist said...

I think that any investigation with the goal of putting holes in the current thinking is not a bad thing. Any debate based on good scientific grounds will only better the positions of both sides and ultimately lead us to the "truth".

At this point I am not entirely convinced that the global warming is a man-made event as suggested. When you have trouble making sense of your observations, check the fundamentals behind your basic premises; in this case, those behind the prediction of global warming.

When I hear predictions based on averages and standard deviations, I can tell without knowing the details of any of the various models that the person making the prediction is using the mathematics of closed, random systems. Because the phenomena being modeled are open, chaotic systems for which no good mathematics have yet been devised, the output of such models should be suspect.

In addition, the predictions and measurements to support those predictions are expressed in temperature of the atmosphere. When predictions and measurement refer to heat, the appropriate unit is calories. To translate calories into atmospheric temperature requires knowledge of each component of the system, because the specific heat of the atmosphere varies markedly with its moisture content.

The first and second laws of thermodynamics should also be considered. They require the interconvertability of all forms of energy, and the trend toward maximum entropy (disorder or chaos). Thus, radiant energy from the sun is absorbed as thermal energy that is converted in part into the dynamic energy of wind and wave, the latent energy of water vapor in the atmosphere, and the electrical energy accumulated in clouds. Combined in this chaotic mix is the thermal energy from Earth’s core and the kinetic energy of the tides, which is created by the momentum of the moon. This is a picture of multiple inputs and interlocking energy cycles-chaos indeed!!

I would also like to say that despite my doubts, I am entirely committed to finding alternative fuel sources and doing what ever it takes to be good stewards of this place called earth. That is simply good manners.

Andrew said...

Thank you so much for your post and conclusion. I am in the same place as you are. I have to fess up to not being very well schooled in statistics, so I leave that to you.

I go to a basic personality trait that I probably got from my father. If we don't know what is going on, then let's be conservative. Put another way, if in doubt; let's err on the side of caution.

If we are careful, and it turns out that global warming is not something we are influencing, then we will have diversified our sources of energy. We will be less beholden to a group of people that don't seem to want us in there desert anyway. If it turns out global warming is something we are suffering from, and can influence, we will be just that much further along in our efforts.