“Norsk Hydro to acquire German aluminum recycler” – Recycling Today, 3 March 2015

Norwegian aluminum and renewable energy company Norsk Hydro is purchasing WMR Recycling GmbH, which, according to Hydro, means Hydro will be the leading entity in aluminum scrap sorting technology.

WMR utilizes x-ray transmission and other forward-thinking technology to sort scrap; the facility has the ability to sift through 36,000 metric tons of scrap annually. The aluminum scrap will also be used to provide material for Hydro’s other Europe-based recycling plants. Hydro will employ some of WMR’s technology to improve their Neuss, Germany-based used beverage can (UBC) plant so that it runs on a closed-loop recycling system.

Hydro recycled almost 1.1 million metric tons of aluminum in 2014, but now that number will surely climb. In 2013, Hydro was working with WMR to transfer some of its aluminum scrap supply to Hydro’s recycling facilities.

Hydro’s move will reflect Norway’s high appetite for a low carbon lifestyle, which will now be aided by an intensified recycling culture.

(From Recycling Today)

Developed and Written by Dr. Subodh Das and Tara Mahadevan

March 4, 2015

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“GOP oil titan: Keystone’s irrelevant” – Politico, 14 November 2014

Though the Keystone XL pipeline has been a hot-button issue with environmentalists, it seems that it has become an irrelevant discussion. The pipeline was introduced in 2005, and still no decision has been made about its construction. In October, the House approved a bill that would authorize the pipeline; however, a few days later, the bill failed to pass through the Senate. If it had passed, the bill would have gone directly to President Obama, though it’s likely he would have vetoed it.

But all that might change when the new Republican-majority Congress reconvenes in January. In fact, it has become the mission of Republican Senator Mitch McConnell (KY) to have the bill pass. It’s probable that the bill will pass both Congress legislatures, but the bill will need 67 votes in favor in order to quash a presidential veto.

Regardless of the pipeline’s importance, proponents firmly contend that the $8 billion pipeline will allow for a flood of new jobs and bolster North American energy independence; but opponents believe that it will increase fossil fuels and further incite the effects of climate change.

It seems like the oil industry has moved on from Keystone; oil companies are employing other pipelines to carry their oil. Furthermore, the US now has an abundance of oil, which has reduced prices. Bringing more oil in from Canada doesn’t seem like the best plan.

What some suggest — like Harold Hamm, the CEO of Oklahoma’s Continental Resources — is that the US should end its crude oil export ban, which would make the oil market fairer for US oil companies. Congress imposed the ban in the 1970s due to the worry that we were becoming too reliant on foreign oil. Now that US oil prices have dropped, Saudi Arabia is attempting to undercut our prices so that it can recover what it has lost in the market. Further, a lift on the ban could help Ukraine and European countries that are under the thumb of Russian President Vladimir Putin.

Conversely, if the ban is lifted, we could see gas prices soar; lawmakers would become our scapegoat.

(From Politico)

Developed and Written by Dr. Subodh Das and Tara Mahadevan

November 29, 2014

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“London Metal Exchange Wins Court Appeal in Aluminum Dispute” – Wall Street Journal, 8 October 2014

The London Metal Exchange (LME) has been in court with Russia-based aluminum manufacturer United Co. Rusal PLC since December, due to Rusal’s opposition over a new set of rules LME is introducing that will alleviate bottlenecks at metals warehouses. A lower court ruled in favor of Rusal in May; the suit was then brought to the UK Court of Appeal, which ruled in favor of the LME. The LME is now set to enact its new rules on February 1, 2015.

Recently, metals warehouses — such as those owned by JPMorgan and Goldman Sachs in the US — have been under heavy fire because of backlogged inventory. Many claimed that by creating bottlenecks and backlogging inventory, warehouses were making a profit from extending the rent that manufacturers and metal owners pay to store metal. In 2013, a case was brought against the Wall Street banks, accusing them of purposely creating a traffic jam in the warehouses. The suit was dropped this past summer, though the warehouses will continue to be surveilled by regulatory commissions, such as the US Department of Justice and Commodity Futures Trading Commission.

Metal warehouses, like the ones that JPMorgan and Goldamn Sachs own, are part of an international network of LME warehouses. Sometimes aluminum orders were so backlogged that customers waited two years to be sent their aluminum. Others have had to spend additional money on premiums to obtain their orders faster.

Last summer, in an attempt to decrease backlogs, the LME proposed new guidelines that allowed warehouses that had bottlenecks of over 50 days to send out more aluminum than they accepted until the bottlenecks were minimized.

After the LME’s initial proposal, Rusal protested, claiming that the new guidelines would financially hurt the company. But now, since the Court of Appeal overturned the lower court’s decision, bottlenecked LME warehouses are already increasing their number of shipments. The Court of Appeal fined Rusal and has banned the company from appealing; however, Rusal still plans to file an appeal with the UK’s Supreme Court.

The original intent of the LME was to provide a forum to balance global and regional  aluminum supply and demand, and inventory management. However, the LME has taken  new unwanted dimensions — accelerating volatility in the global aluminum market leading to more speculation as opposed to manufacturing actions.

Read more:
A Shuffle of Aluminum, but to Banks, Pure Gold
Aluminum Probe Focuses on Costs to Users
Wall Street Banks Get Rid of Aluminum Price Fixing Suits

Developed and Written by Dr. Subodh Das and Tara Mahadevan

October 8, 2014

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“Coal Growing Its Share Of Global Energy Mix Despite World’s Greening Efforts” – IBTimes, 20 June 2014

Although natural gas has become the US’s go-to energy source, and both Europe and the US are bringing the proverbial hammer down on greenhouse gas emissions, coal is still in wide-use worldwide. China and India are the main culprits; since both countries are continuing to grow, they continue to use coal, since it’s one of the cheapest and most plentiful sources of energy. Together, the two countries are the reason coal consumption saw a three percent increase in 2013. Use of natural gas only rose in North America, while it fell everywhere else.

via IBTimes

via IBTimes

Though developed nations will continue to replace coal with renewable and cleaner energy sources, developing countries will continue to rely on coal, as coal will likely remain inexpensive and abundant.

While coal fulfilled 30.1 percent of the world’s energy needs in 2013, oil met 32.9 percent. The US invested a lot of time and money in fracking shale formations, which led to one of the biggest bouts of oil generation that we’ve seen.

But coal could still win the energy battle. In 2012, the International Energy Agency predicted that yearly worldwide consumption of coal would increase by 1.2 billion tons, making it the number one energy source in the world.

New climate policies by the US and Europe are bound to take a toll on the future of coal. Coal will become reliant on China, and even China is making an effort to decrease pollution and smog and use natural gas instead of coal.

Developed and Written by Dr. Subodh Das and Tara Mahadevan

June 30, 2014

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