Control

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Control Zenith of Capitalism Energy Politics
and Economic Impact

• By
• Ghalib Ata
• Instructor of Development Management, IAS, PU,
• Convener Think Tanks - PEF
• Ex-Director RD, LCCI,
• University of the Punjab
• January 5, 2012

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Capitalism Background

• 16th to 17th Century People Vs State-Church
• Policy of Taxation
• Renunciation of Religion
• Compromise
• Dont leave Religion
• Separation of Religion from State
• Higher ideals will come from Peoples Consensus
• Difficult to ask from everyone ask from
  Representative Beginning of Modern Democracy

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Capitalism Four Basic Freedoms (Cont )

• Higher Ideals
• Freedom of Faith
• Freedom of Expression
• Personal Freedom
• Freedom of Ownership
• The greatest Problem Scarce resources to meet
  unlimited desires of people
• Real problem is creation of wealth to remove
  scarcity of resources
• Tools of Creation of Wealth
• Banks
• Leasing Companies
• Stock Exchange

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Capitalism Four Basic Freedoms (Cont )

• Tools of Creation of Wealth
• Banks
• Leasing Companies
• Stock Exchange
• Develop Multi-national Companies
• Every Large Company to have unabated supply of
  resources
• Biggest Resource of Every Company is
• ENERGY

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Distribution of Energy Sources
Oil
Proved reserves at end 2009 Thousand million barrels Share of total R/P ratio
Total Middle East 742.7 61.5 79.5
Total Europe Eurasia 144.4 12.0 22.5
Total Africa 117.2 9.7 32.1
Total S. Cent. America 103.5 8.6 41.2
Total North America 59.9 5.0 12.0
Source BP Statistical Review of World Energy for
UN

• US R/P Ratio is 12 years
• Iran 11.4, Kazakhstan 3.3, Russian Federation
  6.6

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Population Vs Consumption Pattern of Oil
1. Oil Consumption Volume
of World Population Ranking Country Name Million tonnes oil equivalent 2009 2009 World Share
of World Population Ranking Country Name Million tonnes oil equivalent 2009 Total
19.79 China 349.8 9
17.52 India 120.3 3.1
4.54 USA 842.9 21.7
2.41 Pakistan 18.4 0.5
2.14 Russian Federation 128.5 3.3
1.91 Japan 235 6
Source BP Statistical Review of World Energy for
UN

• US consumes 21.7 of worlds oil consumption
• China is 5 times bigger than US consumes only 9
  of worlds oil consumption
• Japan is less than 2 of world population
  consumes 6 of worlds consumption

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Distribution of Energy Sources
Natural Gas
Proved reserves at end 2009 Trillion cubic metres Share of total R/P Ratio
Total Middle East 73.47 40.5 gt 100 Yrs
Total Europe Eurasia 64.13 35.3 59.8
Total Asia Pacific 14.82 8.2 39.3
Total Africa 14.18 7.8 78.6
Total North America 7.98 4.4 10.6
Source BP Statistical Review of World Energy for
UN

• Iran 16,
• Russian Federation 26
• US R/P Ratio 11 Years

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Population Vs Consumption Pattern of Natural Gas
2. Natural Gas Consumption Volume
of World Population Ranking Country Name Million tonnes oil equivalent 2009 2009 share of
of World Population Ranking Country Name Million tonnes oil equivalent 2009 total
19.79 China 50 1.9
17.52 India 35.8 1.4
4.54 USA 588.7 22.2
2.41 Pakistan 27.6 1.1
2.14 Russian Federation 388.9 15.1
1.91 Japan 76.1 3

• US is responsible 22 of worlds gas consumption
• China is 5 times bigger than US consumes only
  2 of worlds gas consumption
• Japan is less than 2 of world population
  consumes 6 of worlds consumption

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Seven Sisters

• Rockefellers
• Huge Oil Monopoly Standard Oil
• Governments Toppled
• 1911 Regulatory Action
• Broken into Smaller companies
• Maintained shares of all
• 1945 Enrico Mattei Italian Minster for Petroleum
  
• Seven Dogs Italian Cat Iranian Oil
• First time 70 of oil produce to natives
• Murdered in Plane Crash

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Seven Sisters

• Cheveron
• ExxonMobil
• Shell
• British Pet
• Standard Oil
• Unocal
• Dick Cheney, Condelisa Rice, Bush, Hamid Karzai

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Theory of Counter Insurgency

• Joint vs. an Ant
• Create Deception
• Iraq WMDs
• 9/11 Falsehood
• Talks Broke down between US Energy Companies

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First Century Routes
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Roman Trade with India
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Gawadar Chinese Pearl in Indian Ocean
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Location of Minerals in Pakistan
Minerals Location of Deposits
Ruby Hunza, Neelam, Upper Hunza
Emeralds Swat, Gilgit, Mehmund, Bajour
Pink Topaz Mardan
Aquamarine Eastern Gilgit Chitral
Peridot Kohistan
Kashmir Ruby Neelam Valley
Gold Saindak Reko Diq
Aluminium Muzaffarabad, Ziarat, Kalat, Khushabad
Iron ore Kalabagh, Nakkundi, Dilband
Copper Saindak Reko Diq
Zinc Lasbela, Khuzdar
Coal Thar, Lakhra, Ziarat, Salt Range, Thatta, Orakzai, etc.
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Precious Stones
Value of Finished Goods in
Proven Reserves Price / Carat Reserves in Million Carats Value in Million International Market Million
Ruby 500 1.5 750
Emeralds 75 70 5250
Pink Topaz 45 9 405
Aquamarine 45 0.2 9
Peridot 39 10 390
Kashmir Ruby 500 125 62500
Total 69,304 693,040
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Metals Coal Reserves
Proven Reserves Price/Ounce million ounce Value Million
Gold 1100 9 9,900

Per Ton Million Tons
Aluminum 2243 74 165,982
Iron ore 76 903.4 68,658.4
Copper 680 1882.5 1,280,100
Zinc 130 23.72 3,083.6
Coal 65 185000 12,025,000
Total 13,552,724
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Coal in Electricity Generation
Coal in Electricity Generation Coal in Electricity Generation
South Africa 94 India 68
Poland 93 Czech Rep 62
PR China 81 Morocco 57
Australia 76 Greece 55
Israel 71 USA 49
Kazakhstan 70 Germany 49
Source IEA 2009
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Current Issues Energy Related Issues

• Power Shortfall ( 2000 MW to 5000 MW)
• Gas reserves to last 2025 (Govt Official Stance)
• Gas available to Industry only 3 days/week
• CNG Stations Shutdown for 3 days/week
• Electricity load shedding in summers
• Cities 8 to 12 hours
• Villages 12 to 18 hours
• Water shortage 1700 (1990) today 1000 cubic
  meter/capita
• Results
• High Energy Prices
• High cost of Input
• Global Competitiveness (Pakistan Ranked 101)

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Business Process
Inputs Equipment Raw Mt Utilities HR Land
Organization
Outputs Goods/ Services
Tax
Process
Annual on surplus income
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Before 1990
Inputs Equipment E Raw Mt
RM Utilities U HR
HR Land L Sub-total IP
Organization
Outputs Goods/ PIP Services Profit
Pr S-Total PIPPr Tax
T Total PIPPrT
Process P Input IP Sub-Total
PIP
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After 1990
Inputs Equipment E15 ST Raw Mt
RM15 ST Utilities U15 ST HR
HR15 ST Land L gt
Expensive Sub-total EIP
Organization
Outputs Goods/ PEIP Services Profit
Pr S-Total PEIPPr Tax
T Total PEIPPrT
Process P Input IP Sub-Total
PEIP
Imports Income Tax
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After 1990
Inputs Equipment E15 ST Raw Mt
RM15 ST Utilities U15 ST HR
HR15 ST Land L gt
Expensive Sub-total EIP
Organization
Outputs Goods/ PEIP Services Profit
Pr S-Total PIPPr Tax
T Total PEIPPrT
Process P Input IP Sub-Total
PEIP
Organization
Imports 2.5 Income Tax
Operating Capital Required
(Riba) Cost of Loan
Bank Financial Institutions
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After 1990
Inputs Equipment E 15 ST Raw Mt
RM 15 ST Utilities U 15 ST HR
HR 15 ST Land L gt
Expensive Sub-total EIP
Organization
Outputs Goods/ PEIP Services Profit
Pr S-Total PIPPr Tax
T Total PEIPPrT
Process P Input IP Sub-Total
PEIP
Organization
Imports 2.5 Income Tax
Operating Capital Required
Customer
(Riba) Cost of Loan
Bank Financial Institutions
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Startling Facts

• Petrol Price in 1990 was Rs. 7.00/liter
• Today?
• Wheat Flour Price Rs 3.25/kilo in 1990
• Today ?
• Trade Deficit 1990 1.48 Billion
• Today ?
• Suicides in 1990 less than 100 recorded
• Today ?

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Question

• What changed
• in last 20 Years?

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Govt. Revenues and Subsidies Since 1980 in
Electricity and Gas
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Problem of Ownership Wrath of Capitalism

• Answer from Communism
• State-Ownership
• Answer from Capitalism
• Private-Ownership
• Answer from Islam
• Three types of Ownerships
• Collective
• State
• Private

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Turkman-China Pipeline 20 Billion CM DoneAnother
20 Billion CM Pipeline till end 2010
Pakistan
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China Russia New Entries to Capitalism

• Purchase of US Federal Bonds
• China 1.4 trillion
• Russia 700 billion
• China and Russia have stakes in US Economy
• Last year fear of meltdown in US Economy forced
  following changes
• Alternate currency
• Breaking hegemony on energy fields and trade
  routes

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Nord Stream
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South Stream
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Issues and Solutions

• Energy Collective ownership no profiteering
• Mineral resources - Collective ownership no
  profiteering
• Primary industry Collective ownership
• Concentration of wealth in few hands Prohibited
• Currency Gold/Silver or Gold/Silver Based
• Taxation based on Islamic From Rich to Poor
• Housing State Responsibility

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Accept the Fact that Human Beings Cannot Make Law
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Divine Law is the Solution
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• Thank You

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New Water Major Reservoirs
Water Storage Bhasha Dam Kalabagh Dam Proposed Pakistan Dam Total Increase in Capacity
Live Storage 6.4 MAF 6.1 MAF 12.5 MAF
Gross Storage 8.1 MAF 7.9 MAF 16 MAF
WAPDA Documents 2010

• Bhasha Dam is Recover of 5 MAF of lost Storage
  Capacity
• Only 1 MAF will be add
• - Kalabagh Dam to add 6 MAF of storage capacity

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Impact of Disintegration of Soviet Union

• Kissinger and Brizinski
• Stop the Reemergence of Soviet Union
• By entering Central Asian States
• Reduce dependence of Central Asian States on
  Moscow
• Create alternate Energy Market for Caspian Sea
  fossil fuel
• Stop the Reemergence of Political Islam
• Denuclearize Pakistan
• By entering Afghanistan
• Deception Constructive Chaos Counter
  Insurgency

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Potential

• Hydro Power Potential 46000-50000 MW
• Exploited power potential 6474 MW
• Coal Power Potential Enough for 500 Years
• 1,85,000 Million Tons Worth 9 Trillion
• Coal Imports are higher
• than local extraction
• Gold/Copper Reserves More than 500 Billions
• Total External Debt 51.5 Billion

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