Burgess COMMENTARY
I enjoy the discussions that take place on C-SPAN, though I do not agree with much of the conversation. Recently I listened to .......... the Chief Economist of the American Petroleum Institute as a guest on their morning call-in show. A number of times he made the point that the refinery section of the petroleum industry was only making 2 cents on the dollar in its section of the business. He also made the point that the industry as a whole was only making 6 cents on the dollar ... rather modest, he pointed out, compared to the average of 10 cents on the dollar for the stock market as a whole. I used to be a corporate CFO ... and there are important rules about how the financial performance of a group of companies is aggregated. The 'talking points' about financial performance of a sector of the economy should follow similar rules, but does not. The 'profit margin' ... that is the percentage of profit relative to sales ... is a very weak metric. The real question that should be asked is what is the profit relative to the investment at risk. In the modern petroleum industry there are a few vary large 'integrated oil companies' and a huge number of suppliers to these companies, and a huge number of independent operators in various segments of the industry. These companies also have sales, costs and profits ... some are very profitable, others less so. But whenever they sell into the integrated oil companies, the profit of these companies is buried as a cost.
Peter Burgess

Oil Sands, Greenhouse Gases, and U.S. Oil Supply: Getting the Numbers Right According to the American Petroleum Institute:

The objective of this report is to provide an independent perspective on the life-cycle GHG emissions of oil sands compared with other crudes; on the evolving discipline of estimating life-cycle GHG emissions, particularly for oil sands; and on the growing trend of using life-cycle GHG analysis in policy. These policies have the potential to affect the market for Canadian oil sands and other sources of carbon-intensive crude oil.