Obama Underwrites Offshore Drilling
http://online.wsj.com/article/SB10001424052970203863204574346610120524166.html
You read that headline correctly. Unfortunately, the Obama Administration isfinancing oil exploration off Brazil.
The U.S. is going to lend billions of dollars to Brazil's state-owned oil company,Petrobras, to finance exploration of the huge offshore discovery in Brazil'sTupi oil field in the Santos Basin near Rio de Janeiro. Brazil's planningminister confirmed that White House National Security Adviser James Jones metthis month with Brazilian officials to talk about the loan.
The U.S. Export-Import Bank tells us it has issued a "preliminary commitment"letter to Petrobras in the amount of $2 billion and has discussed with Brazilthe possibility of increasing that amount. Ex-Im Bank says it has not decidedwhether the money will come in the form of a direct loan or loan guarantees.Either way, this corporate foreign aid may strike some readers as odd, giventhat the U.S. Treasury seems desperate for cash and Petrobras is one of thelargest corporations in the Americas.
But look on the bright side. If President Obama has embraced offshore drilling inBrazil, why not in the old U.S.A.? The land of the sorta free and the home ofthe heavily indebted has enormous offshore oil deposits, and last year ahead ofthe November elections, with gasoline at $4 a gallon, Congress let a ban onoffshore drilling expire.
The Bush Administration's five-year plan (2007-2012) to open the outer continentalshelf to oil exploration included new lease sales in the Gulf of Mexico. But in2007 environmentalists went to court to block drilling in Alaska and in April afederal court ruled in their favor. In May, Interior Secretary Ken Salazar saidhis department was unsure whether that ruling applied only to Alaska or alloffshore drilling. So it asked an appeals court for clarification. Late lastmonth the court said the earlier decision applied only to Alaska, opening theway for the sale of leases in the Gulf. Mr. Salazar now says the sales will goforward on August 19.
This is progress, however slow. But it still doesn't allow the U.S. to explore inAlaska or along the East and West Coasts, which could be our equivalent of theTupi oil fields, which are set to make Brazil a leading oil exporter. Americansare right to wonder why Mr. Obama is underwriting in Brazil what he won't allowat home
This may be the answer WHY
http://www.bloomberg.com/apps/news?pid=20601086&sid=aFHPjfeUvtl8
Aug. 15 (Bloomberg) -- Billionaire investor George Soros bought an $811 millionstake in PetroleoBrasileiro SA in the second quarter, making the Brazilian state-controlledoil company his investment fund's largest holding.
As of June 30, the stake in Petrobras, as the Rio de Janeiro-based oil producer isknown, made up 22 percent of the $3.68 billion of stocks and Americandepositary receipts held by Soros Fund Management LLC, according to a filingwith the U.S. Securities and Exchange Commission. Petrobras has since slumped28 percent.
Soros has increased his mining and commodities holdings, a move that accelerated inthe first quarter with purchases of such companies as Cia. Vale do RioDoce, the world's largest iron-ore producer, and Talisman Energy Inc.,a Canadian oil and gas company. In November, Petrobras announced the discoveryof Tupi, a field with as much as 8 billion barrels of reserves, making it thelargest find in the Americas since 1976.
``Petrobras has something that other oil companies don't have: oil -- lots of it andthey're going to find more,'' said RicardoKobayashi, equity fund manager with UBS Pactual SA in Rio de Janeiro, whichmanages about $5 billion of stocks, including shares in Petrobras. ``If you canbuy now and hang on, if you have the staying power, it's great.''
Tupi is part of a new deepwater offshore region known as the pre-salt that maycontain as much as 50 billion barrels, according to PeterWells, oil analyst with the U.K.'s Neftex Petroleum Consultants Ltd.
Share Slump
The drop in Petrobras' U.S.-traded common shares since June 30 would have reducedthe value of Soros's disclosed stake by $235 million.
Soros Fund Management didn't report holding any Petrobras shares at the end of thefirst quarter. It did disclose much smaller stakes in the Brazilian oil companyduring 2007, including 150,000 depositary shares, with a market value of about$17.3 million, at Dec. 31. The hedge fund company also had calls on another35,000 shares at Dec. 31.
Petrobras shares traded at an average closing price of $64.83 each during the second quarter,when Soros bought the stake. The shares today dropped 91 centavos, or 1.8percent, to $50.68 in New York, valuing Petrobras at $204.8 billion, theworld's 11th-biggest company by market capitalization.
Soros funds also bought almost 9.5 million shares of Lehman BrothersHoldings Inc. during the second quarter, according to today's filing. Sorosfunds held 10,000 Lehman shares at March 31, just before the second quarterbegan.
Lehman shares closed at $19.81 each on June 30, giving Soros's stake in the New York-basedbrokerage a market value of about $187.7 million when the quarter ended. Lehmanshares have since declined 18 percent, reducing the stake's value to $153.5million.
Michael Vachon, a Soros spokesman, didn't immediately return a telephone callseeking comment.
There are five very interesting videos on Soros's views on capitalism vs. his"global open society." Scary
Replies
Front Page Magazine --a website run by David Horowitz-- has a bio on Soros that should be required reading for every US citizen living today. Easily one of the wealthiest men in the world today Soros is well-positioned to put his ultra-leftwing radical agenda into the global mainstream of world politics, which is what he has been busy at work on for many years now. Unfortunately, Soros' global agenda includes the destruction of the United States of America and Obama is his hit man. A developing nation leaning towards Socialim, Brazil is exactly the type of nationstate Soros has schemes for using as a front for his new world order.
Soros is a seriously dangerous megalomaniac in addition to being an international financial criminal mastermind. We all need to beware of him--and stop him. (Soros has ALREADY gone way too far most would agree).