Lesson 5 Activities

Value Chain Activity

Figure 1: Value Chain for Energy Commodities

Click here for a text alternative of Figure 1

Flow chart in the shape of an arrow.
Production & Gathering (Wellhead Cost, Gathering Fees, Fuel)

Leads to

Processing/Refining (processing fees, refining fees, inputs/outputs)

Leads to

Transmission (levels of service, tariffs, rates & fuel)

Leads to

Storage (levels of service, tariffs, rates of fuel)

Leads to

Distribution (utilities, end-users, residential, retail)

Source: Dutton e-Education Institute [1]

1. Take a look at the value chain for energy commodities (Figure 1 above). Review the lesson slides and think about the various parts of the crude oil value chain. Do some research and extract 5 cost items associated with the value chain.
   
   For example: According to EIA, the transportation cost for shipping crude oil from Cushing, OK to the U.S. Gulf Coast, without pipeline constraints, is estimated to be around $3.50/bbl. (EIA 2017 [2])

2. We know that the amount of crude oil the US imports continues to decline due to increased domestic production, but, do you see demand increasing or, decreasing, over the next decade? What are your reasons for this stance? Provide charts, reports, and stat for your argument.

Grading Criteria

You will be graded on the quality of your responses. This question is worth up to 20 points on the EBF 301 grading scale; each question is worth up to 10 points.

Fundamental Factors

The Fundamental Factors activity is due as usual this week, at 11:59 pm on Sunday, and is worth 30 points on the EBF 301 grading scale. Please refer to the Fundamental Factors Instructions [3] for additional information and grading rubric.

Quiz

Return to Canvas to complete the L5 Quiz.