Self Test

Oil Refining, Energy Transportation, and Linear Programming

Contributions by Alex Lombardia, Benoit Gervais, Serhat Altun,Tyler Hodge,

Sofia Morales, Kevin DeGeorge (edited by Tayo Soyemi)

Click on True or False to test your knowledge of the chapter.

1. True False. The largest portion of world energy is produced from hydro power.

2. True False. Associated gas is dissolved in oil, non-associated gas is found by itself.

3. True False. The largest portion of the world's electricity is produced from hydro power.

4. True False. The CIS has the greatest uranium reserves.

5. True False. CAMECO is the largest uranium producer.

6. True False. In-situ leaching requires massive movement of overburden and results in a large amount of tailings.

7. True False. Uranium enrichment is strictly prohibited in the U.S.

8. True False. Uranium enrichment is a critical step in transforming natural uranium into nuclear fuel to produce energy and requires increasing the concentration of U-235 to fissionable levels

9. True False. After being mined, uranium is directly used as fuel for nuclear plants.

10. True False. While production is concentrated in a handful of companies worldwide, uranium conversion and uranium enrichment is done by multiple small companies all over the world.

11. True False. Spent fuel can be reprocessed after leaving the nuclear reactor.

12. True False. There is no difference between mixed oxide fuel (MOX) and basic nuclear fuel.

13. True False. Canada is the largest producer of hydroelectricity followed by the U.S.

14. True False. The Hoover dam, in the U.S., has the largest hydro capacity in the world.

15. True False. The amount of electricity produced by hydro is only influenced by the amount of water flow entering the turbine.

16. True False. Hydroelectric power produces “clean” electricity with no environmental impacts.

17. True False. Another advantage of hydroelectric power is that it is a constant and reliable source of electricity.

18. True False. A prefabricated 400 Kw wind turbine costs $300,000 plus $100,000 of installation costs all due at the completion of installation. Assume that:

1. Winds allow the turbine to turn at full capacity 25% of the time for 20 years with no down time for repairs.

2. Production stops at the beginning of year 21.

3. The discount rate is 10%.

4. You begin to produce power immediately upon installation and are paid for the power at the beginning of each year.

Then, the levelized capital cost per kwh is $0.048.

19. True False. Continue with the example in the above question. A 400 Kw wind turbine costs $300,000 plus $100,000 of installation costs all due at the completion of installation. Again assume that:

1.Winds allow the turbine to turn at full capacity 25% of the time for 20 years with no down time for repairs.

2.Production stops at the beginning of year 21.

3.The discount rate is 10%.

4. You begin to produce power immediately upon installation and are paid for the power at the beginning of each year.

Then, the levelized cost of power is $0.048 from above. Now if the interest rate doubles, the cost per kwh will be cut by half.

20. True False. Continue with the example in the above question. A 400 Kw wind turbine costs $300,000 plus $100,000 of installation costs all due at the completion of installation. Again assume that:

1.Winds allow the turbine to turn at full capacity 25% of the time for 20 years with no down time for repairs.

2.Production stops at the beginning of year 21.

3.The discount rate is 10%.

4. You begin to produce power immediately upon installation and are paid for the power at the beginning of each year.

From above, the levelized cost of capital is $0.048. Now, if a new technology allows generators to double their productive life, ceteris paribus, your capital cost per hour will decrease by about 12%.

21. True False. The probability distribution of possible wind speeds in the region are:

x P(x)

30 mph 5%

10 mph 45%

0 mph 50%

(Assume that electricity production El is a function of wind speed:

El = g(x) = 30x

x= wind speed

Then the expected amount of power generated is 1,576,800 kwh each year.

22. True False. Now combine the information in the above problems. You have bought a 400 Kw wind turbine that costs $300,000 plus $100,000 of installation costs all due at the completion of installation. Assume that:

1. Production stops at the beginning of year 21.

2. The discount rate is 10%.

3. The probability distribution of possible wind speeds in the region are:

x P(x)

30 mph 5%

10 mph 45%

0 mph 50%

4. Electricity production is a function of wind speed:

El = g(x) = 30x; x= wind speed

Then the cost per kwh is $0.048.

23. True False. A solar cooker is expensive to build because of the advanced technology needed.

24. True False. Photovoltaics are made from two layers of silicon material, or other conductor that have added impurities.

25. True False. The disadvantages of photovoltaics are that they are costly, power generation is intermittent and so requires storage or alternative power sources, and sunlight is diffuse.

26. True False. The advantages of solar power are that it is widely spread, often matches energy use patterns, and the costs are comparatively inexpensive relative to other methods of electricity generation like oil, gas, coal and nuclear.

27. True False. Geothermal energy is produced only in the form of hot water from deep within the earth and is used solely for heating purposes.

28. True False. Capital costs for an oil field are K, the reserves found are R_o. The interest rate is r and the decline rate is a. In ground costs of oil are K/R_o and above ground costs are (K/R_o)*(a + r)/a

29. True False. Suppose you have found a new field in the Pletmos Basin, offshore South Africa, and you have the following data:

Decline rate is a = 0.15.

Discount rate is 0.12.

Field cost $2.3 billion to find and develop.

Reserves are 380 million barrels.

Your in ground cost is $10.89.

30. True False. If a pipeline company has initial cost of $ 325 million with a 15% discount rate . It costs $1.2 per barrel to transport 450 million barrels of oil for 15 years.

31. True False. The Hubbert Curve implies that oil and gas production will continuously decline over time.

32. True False Power storage is not a problem with solar power as it is a constant, steady power supply.

33. True False Independent of the many fuel sources discussed in this chapter, making electricity starts with turning a generator shaft.