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Monday, May 15, 2017

Trump busts a billionaire's monopoly

For eight years, Barack Obama waged an open war against North Dakota. Obama's billionaire buddy Warren Buffett owned the railroad that had a near monopoly on transporting oil out of the state. Obama kept pipelines from opening because it would ruin Buffett's monopolistic environment.

I hope Buffett paid Obama well for services rendered.

But that swamp was just drained.

From the Associated Press:
There are hundreds more jobs than takers in the heart of North Dakota's oil patch. Finding a hotel room, parking space or table at a restaurant is no longer easy.
More than two years after the state's unprecedented oil bonanza fizzled to a lull, North Dakota - the nation's No. 2 oil producer behind Texas -- is experiencing a sort of boomlet that has pushed daily production back above 1 million barrels daily.
"There is a long-term optimism that was not here just a year ago," said Williston Republican Sen. Brad Bekkedahl, whose western North Dakota district is in the epicenter of the state's oil-producing region.
Industry officials and others say the uptick comes from a bump in crude prices, regulatory certainty with the more drill-friendly Trump administration, better technology, and the prospect of nearly half of the state's crude coursing through the disputed Dakota Access Pipeline, which could open markets abroad where top prices are typically fetched.
Buffett is kissing off $3 million a day -- $1 billion a year.

From the story:
The $3.8 billion pipeline -- expected to be fully operating next month -- opens up the possibility for North Dakota oil to be sold on the world market, where industry officials say it could earn several dollars more per barrel. Shippers also can save about $3 per barrel moving the oil by pipeline rather than using the mile-long trains that have carried North Dakota crude to the Gulf Coast since 2008, industry officials say.
Yep. Buffett pocketed $3 a barrel from transporting 1 million barrels of oil a day on his railroad.

Obama did not care about the environment or the danger of mile-long trains carrying crude oil. Obama was TCB -- taking care of Buffett.

Of course, the Associated Press ignored all this in a lengthy article that was meant to impress people with its research while it ignored this key fact of why the pipeline was not built under Obama.

But this is a happy ending for North Dakota which after eight years of Marxist cruelty in Washington will soon be free from Warren Buffett's monopoly.

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  1. "Buffett pocketed $3 a barrel from transporting 1 million barrels of oil a day on his railroad."

    I think this is understated. The article says oil shippers with save about $3/bbl but the pipeline doesn't ship for free. So Buffet's gross was somewhat higher than $3/bbl but there's not enough information in the article to determine the exact amount.

  2. Trump wants everybody to have a shot.

    Another reason why I like the guy.

  3. Yay Williston! Used to pass through there on the way to see Grandma in Minnewaukan. Loved the smell of that town as the little metal dinosaurs pulled their ancestors out of the ground. It smelled like progress. It smelled like winning. Thank you Mr. Trump and let's go NoDak!

  4. Many illusions were shattered when I learned that Buffet was a rent-seeking, hypocritical liberal. No tears shed here as Buffet's railroad gets schlonged.

    1. Also a polygamist, but on the down low

    2. I used to wonder why billionaires like Buffett wanted the socialists in power. Then I saw that it was easier for them to buy influence with the government than to compete in open markets. Democrat-passed "renewable" mandates are a gold mine for the connected. Here's how Buffett made a risk-free killing on the wind scam:

      --MidAmerican appropriately makes post-tax profits of $1,574,000,000 for producing just 11% of the electricity that Ameren produces. And Ameren’s net income after an assumed tax rate of 37% is just $255,000,000. So, in the end: 1 kilowatt of windmill electricity produces 57x the profit of 1 kilowatt of hydrocarbon fuel electricity.

      The extraordinary and outsized economics of green energy are consistent with an arcane scheme. It is originated by government mandates forcing all electric customers to pay for nothing except for the transfer of wealth to the “chosen winners” of the high priests of Green Energy Ideology. Getting chosen to own a windmill is an economic gift of unprecedented proportions. And it will last as long as the “wind blows”! The Green Energy elites are profiting at the expense of all electricity users. They must do everything possible to prevent “we the people” from ever discovering how they make all their money.

      And here is one of the most disingenuous comments that has ever been made:

      When our current projects are completed, MidAmerican’s renewables portfolio will have cost $15 billion. We relish making such commitments as long as they promise reasonable returns. And on that front, we put a large amount of trust in future regulation.

      This is the so-called sage of Omaha, Warren Buffett. He clearly believes in getting his share of the redistribution of wealth from working people to the wealthiest of elites.

      One last note, at a cost of $15 billion, the total probable investment tax credit would be (30% x $15 billion) = $5 billion. The $10 billion of cost most likely could be “borrowed money.” Remember, Warren said:

      MidAmerican’s earnings base has further broadened. This particular strength, supplemented by Berkshire’s ownerships, has enabled MidAmerican and its utility subsidiaries to significantly lower their cost of debt.

      If they borrowed the $10 billion they would have no equity in the project-which would result in tax free income of $1.574 billion, an infinite return on investment.--

  5. Buffet fed at the Obama buffet.

  6. The quality of Bakken oil is close to gasoline at the wellhead. This is why when trains of it have mishaps explosions occur. The quality of Canadian tar sand oil, in contrast, is close to asphalt at the wellhead.

    Of big help would be pipelines that reach wellheads in ND. Currently, virtually all wellhead oil there is trucked to tank farms from which it is RR'd to refiners.

    Seattle officials rage against BNSF, which runs under downtown Seattle, letting chunks of coal, which is inert, drop on the ground. So far, they have not peeped about their political ally Buffet's Bakken oil, which is explosive, running under their city.

  7. The pocketed $3 a barrel is inorrect. That is the tafiff the shippers pay for rail service. The oil tank cars are owned by private leasing comanies and they collect greater than half of the shipping cost to pay for the capital and operating cost of the mobil oil containers, terminally companies at both ends all get a cut. BNSF likely collects less than a quarter of the gross cost.

    Then there is the issue of the gross vs. net. Would you say that Buffet "pockets" the gross revenues of GEICO? Or would you say he makes the net after paying losses, overhead and all those lizard commercials?

    In any case this article is way off base.

    1. I am quite sure BUffet would prefer that the pipeline never opens so he can maintains his monopoly , the amount of his monopoly profits may be wrong but they exist.

  8. Yep, Don, Democrat opposition to the pipeline was never about the environment at all. Buffet is a goddam pirate.