Original Proposal

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This section contains two postings.

The second is the actual Original Proposal which was reviewed in detail before being unanimously adopted at our 11/13/2019 meeting by the attendees of our 10/16/2019 meeting.

It comprises 3,625 words and runs to more than 9 Microsoft Word pages (standard margins and Times New Roman - 12).

Accordingly, the first posting was the actual announcement that was sent to our 162 members in our weekly Saturday/pre-dawn e-mail on Saturday October 19.

It serves, in effect, as an Executive Summary for the actual Original Proposal.

BTW, it contains a cross-link to the Original Proposal which is the second posting in this section.

For the curious, the cross-link to the Original Proposal in our Oct 19 e-mail to our members was “http://discussingliberally-saltlake.org ... 0c6776ca27.” Such cross-links in an external document or e-mail to items posted on this bulletin board, when the external document or e-mail is itself posted on this bulletin board, are automatically converted by this bulletin board (in this case to "viewtopic.php?f=561&t=1834").
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johnkarls
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Original Proposal

Post by johnkarls »

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[The following proposal was unanimously adopted for our 11/13/2019 meeting by the attendees of our 10/16/2019 meeting.]

I (John Karls) propose that we focus on “Possible Global Warming Solution (Hydrogen Extraction) In Danger Of Being Killed!!!”

This would be one of those atypical occasions for which there would NOT be a focus book but instead, we would be focusing on whatever is available that our participants post on http://www.ReadingLiberally-SaltLake.org > “Reference Materials” for Nov 13 and on whatever comments our participants post on http://www.ReadingLiberally-SaltLake.org > “Participant Comments” for Nov 13.

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Hydrogen as a Carbon-Free Fuel

Just like nuclear energy which is carbon-free, using hydrogen is also carbon-free.

[Burning (aka oxidizing) hydrogen produces nothing but water – 2H2 + O2 > 2H2O.]

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The “Hydrogen Highway” in Europe and California 20 Years Ago

Considerable information about the “Hydrogen Highway” is available on http://www.ReadingLiberally-SaltLake.org for our 7/13/2011 meeting 8 years ago on “America’s Climate Problem: The Way Forward” by Robert Repetto. In summary -

By the early 2000’s, the governments of both Europe and California had constructed a network of hydrogen-fueling stations that permitted hydrogen-powered cars to travel vast distances.

Several manufacturers, such as BMW, sold standard models whose engines had been tweaked to run on hydrogen or, in the case of the BMW models, on either gasoline or hydrogen depending on availability at the moment/locality.

However, President Obama caused the U.S. to turn away from hydrogen as the solution to Global Warming and toward battery-based electric vehicles.

As we have studied several times in the past, battery-based electric vehicles are AN UNMITIGATED DISASTER because the electricity they use is the result of coal-fired electricity-generation plants!!!

[The U.S. currently has 4 million all-electric vehicles on the road today, which means that it has NOT been possible to “moth ball” the most-polluting coal-fired electricity-generation plants that could have been eliminated from the grid absent the electric vehicles.]

[NB: this criticism does NOT apply to hybrid vehicles which generate their own electricity from the gasoline engine’s waste heat, and it does NOT apply to the rare owner of an all-electric vehicle who has enough solar panels to provide 100% of the vehicle’s needs IN ADDITION TO ALL OF THE OWNER’S OTHER NEEDS SUCH AS HVAC FOR THE OWNER’S DWELLING.]

[From an environmental viewpoint, using electric vehicles is only capable of exporting PARTICULATE air pollution to downwind states where the coal-fired electric-generation plants are located – BUT IT MAKES NO DIFFERENCE TO GLOBAL WARMING THAT THE CARBON POLLUTION HAS BEEN MOVED DOWNWIND (CARBON POLLUTION IS JUST AS DISASTEROUS NO MATTER WHERE IT OCCURS!!!)]

IN ALL FAIRNESS TO PRESIDENT OBAMA, it did NOT appear that “The Hydrogen Highway” would ever be practical because there was at that time no economical source for vast amounts of hydrogen fuel.

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The New Possibility of Vast Amounts of Hydrogen Fuel

According to the U.S. Department of Energy, as much as 75% of crude oil is left behind after so-called “primary production” (which is using any pre-existing natural pressure, gas or water, originally bearing on the crude oil) and “secondary production” (pumping water, etc., into some of the reservoir’s wells to physically force the crude oil to the surface through another well).

The problem is even worse for so-called “heavy oil” (think of grease on a frying pan) and so-called “tar sands” (think of highway asphalt).

So-called “tertiary production” often, if not usually, involves injecting detergents (yes, such as you would use on that frying pan in your own kitchen sink) to loosen up that “grease” and “asphalt.”

But even “tertiary production” only accesses a fraction of the remaining heavy oil or tar sands.

So what is the new trick???

As we have studied many times in the past, nature’s plants USE SOLAR POWER to combine water and carbon-dioxide to produce sugar (6CO2 + 6H2O > C6H12O6 + 6O2).

And animals ACCESS THE SOLAR POWER in the sugar molecules of the plants they have eaten by oxidizing, aka burning, the sugar molecules (C6H12O6 + 6O2 > 6CO2 + 6H2O).

And all of the sugar molecules in the decayed bodies of zillions of animals that lived over the millennia which we call oil & gas or coal (or BTW if there has been incredible pressure, diamonds) is what we burn (aka oxidize) in our vehicles and power plants.

The problem???

Burning (aka oxidizing) C6H12O6 produces carbon-dioxide as well as water.

BUT would it be possible to access ONLY THE HYDROGEN in the C6H12O6 and leave the rest in the ground???

That is what the new technique is designed to do!!!

It involves injecting oxygen into the heavy oil, tar sands and coal that will react chemically with the heavy oil, tar sands or coal to release hydrogen which (because of its lightness) will float to the surface leaving behind the carbon trapped by hydrogen filters.

[Presumably 3O2 + C6H12O6 > 6H2 + 6CO2 with the hydrogen floating to the surface and the carbon dioxide filtered out for sequestration.]

Any obvious flaws???

Per NASA, the earth’s atmosphere comprises 78% nitrogen, 21% oxygen and the remaining 1% various other gases (0.93% argon, 0.04% carbon dioxide and 0.04% other gases).

The human species is very sensitive to oxygen deprivation (per Wikipedia on Hypoxia, “When the oxygen level dips below 19.5% v/v, the air is considered oxygen-deficient …... oxygen concentrations below 16% volume are considered highly dangerous for humans”).

Nevertheless, it would appear from these statistics that ALL OF THE CARBON DIOXIDE IN THE EARTH’S ATMOSPHERE (4 one hundredths of 1%) could be eliminated by reducing the amount of oxygen from 21% to 20.96% without endangering the human species.

[And yes, we realize that it would NOT be desirable to eliminate carbon-dioxide entirely because that would kill all plant life on planet earth – this math exercise is only intended to demonstrate that the new hydrogen-extraction technology could be used to reduce carbon in the earth’s atmosphere to whatever level is considered desirable vis-à-vis Global Warming WITHOUT threatening the viability of the human species.]

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Is The New Hydrogen-Extraction Technology Economically Competitive???

Proton Technologies (an Alberta Canada corporation) owns the patents to the new technology.

[According to its website (“proton.energy” – no “www” prefix and no suffix such as “com”), Proton Technologies Corporation has already applied for the basic patent, and for a thicket of protective patents surrounding the basic patent.]

In a presentation at the 8/19/2019 Goldschmidt Conference (a report of the presentation is available at http://discussingliberally-saltlake.org ... 562&t=1838), Grant Strem, CEO of Proton Energy Corporation, is quoted as saying -

“When working at production level, we anticipate we will be able to use the existing infrastructure and distribution chains to produce H2 for between 10 and 50 cents per kilo. This means it potentially costs a fraction of gasoline for equivalent output. This compares with current H2 production costs of around $2/kilo. Around 5% of the H2 produced then powers the oxygen production plant, so the system more than pays for itself. What comes out of the ground is hydrogen gas, so we don't have the huge above-ground purification costs associated with oil refining: we use the ground as our reaction vessel. Just taking Alberta as an example, we have the potential to supply Canada's entire electricity requirement for 330 years (Canada uses around 2.5% of the world's electricity—around the same amount as Germany, and more than France or the UK). Our initial aim is to scale up the production from Canadian oil sands, but in fact, we anticipate that most of the interest in this process will come from outside Canada, as the economics and the environmental implications make people look very hard at whether they want to continue conventional oil production. The only product of this process is hydrogen, meaning that it the technology is effectively pollution and emission free. All the other gases remain in the ground because they cannot go through the hydrogen filter and up to the surface.”

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Three Cautionary True Tales

Following our 10/16/2019 meeting, I (John Karls) and George Kunath discussed Hydrogen Extraction in a two-way conversation for another 90 minutes.

[George Kunath is one of my former NYC partners with whom I have had a weekly multi-hour gabfest for 31.5 years; George has also had extensive oil & gas experience since he was our worldwide coordinating tax partner on Mobil Oil (as well as on a major private equity firm). George has participated in our Reading Liberally meetings for nearly a decade by Skype.]

We noted that the website of Proton Energy Corporation (“About Us” > “What Is The Corporate Structure”) says –

“Because the I.P. [editorial note – the “Intellectual Property” which is protected by patents] is owned by a separate corporation without any field operations or assets, the I.P. remains secure and well-defended, world wide.”

George and I agreed that this was either the most stupid or the most condescendingly-fraudulent statement we had ever encountered in our combined existences of 150 years.

Putting something in a corporation does NOT, ipso facto, protect it!!!

Who owns the corporation???

And no matter how pure have been the shareholder(s) heretofore, what is to prevent them from selling out???

After all, “everything has its price” as the old saying goes!!!

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Cautionary Tale No. 1 – Leonard da Vinci’s “Last Supper”

One of Leonardo da Vinci’s most famous paintings is “The Last Supper” which portrays Christ informing his 12 Disciples (11 of whom became Saints) that one of them would betray Him.

Within hours, Judas “fingers” (actually by pre-arranged signal, a kiss) Christ for the Roman soldiers who, within hours, crucify him.

What tempted Judas to sell out???

The proverbial “thirty pieces of silver”!!!

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Cautionary Tale No. 2 – Bill Lear’s Steam Car

Bill Lear was one of the most famous inventors of the last century with more than 100 important inventions.

Probably most famous for taking on the aircraft industry and beating it with the first successful business jet – the Lear Jet whose current model (Learjet 70/75) is a familiar sight at airports around the world.

But probably most admired for, among the many radio and navigation-instrument inventions that are still the standard of the industry, his autopilot which in 1950 won the Collier Award, the highest honor the aircraft industry can bestow.

Twiddling his thumbs after selling out Lear Jet in the late 1960’s, he decided that he could achieve immortality by taking on the world’s largest industry (the automotive industry) and beating it in order to solve the air-pollution crisis with a steam car that would produce less than 1% of the pollution from an internal-combustion engine.

Available at http://discussingliberally-saltlake.org ... 562&t=1837 is an account of that effort in Sports Illustrated of 2/3/1969 –

With a large team of the world’s best engineers on his personal payroll, he developed a steam engine that could fit inside a regular passenger car or a regular race car. It could warm up and be ready to go in a matter of seconds. And he had contracted with the California State Highway Patrol to put his steam engine into all of their patrol cars.

And he also announced to the world that he would win the Indy 500 – for which he built an exact replica race track at his Reno NV factory which occupied an old airport.

The reason???

The Indy 500 track has two 180-degree turns for which race cars have to slow down. Coming out of the turns, the acceleration of conventional race cars is ENGINE LIMITED. Whereas, while a steam car slows for the turns, it can be building up a head of steam so that coming out of the turns, its acceleration is NOT ENGINE LIMITED, but rather only limited by the ability of the tires to grip the racing surface.

Did Bill Lear ever achieve his immortality???

Rumors were rife that he sold out his $15 million investment (approximately $200 million in current dollars) to General Motors for an amount many times his investment -- and General Motors killed the project. [However, Bill Lear never ran for U.S. President during the course of which he was forced to release his tax returns, so we will never know!!!]

Apparently immortality had its price for selling out, even for Bill Lear.

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Cautionary Tale No. 3 – Saudi Arabia

[NB: The following events of 1979 occurred while John Karls was Senior Tax Attorney and Director of Worldwide Tax Planning for Texaco Inc. 1974-1987 when it was still a Fortune 10 company and when (in 1979) Texaco and its Aramco partners (Exxon, Chevron & Mobil) still owned 100% of the oil & gas in Saudi; his following opinion vis-à-vis investors is based in part on his having been a Managing Director of Britain’s second-largest investment-banking firm 1996-2002.]

Since the early 1970’s, the world price for oil & gas has been set by OPEC (the Organization of Petroleum Exporting Countries).

OPEC has been able to do so because throughout the history of OPEC, Saudi has been willing to curtail oil & gas production sufficiently to make OPEC prices stick.

Though Saudi showed the rest of OPEC “who was boss” in the late 1970’s.

By way of background, Saudi has always had long-lived oil & gas reserves while many OPEC members had only short-lived reserves and wanted to gouge the market while they still had something to sell.

[If you look at http://www.cia.gov > World Factbook > Saudi Arabia, you will see that Saudi currently produces 10.425 million barrels/day of which 7.342 million b/d of crude oil are exported, making it the world’s largest exporter – however, its “proved reserves” are 266.2 billion bbl WHICH MEANS THAT EVEN IF SAUDI NEVER DISCOVERS ANOTHER DROP OF CRUDE OIL, IT STILL HAS ENOUGH ALREADY “PROVED RESERVES” TO LAST 69.96 YEARS AT ITS CURRENT PRODUCTION LEVEL OF 10.425 MILLION B/D!!!]

This is why Saudi has ALWAYS dictated to the rest of OPEC (since none of its other members has ever been willing to shut in enough production to make OPEC prices stick) world oil & gas prices low enough TO MAKE UNECONOMIC any alternative fuels that might threaten the value of Saudi’s long-lived reserves.

Saudi “showed the rest of OPEC who was boss” in 1979 by dictating Aramco prices that were 10% less than the new price that had just been announced by the rest of OPEC.

[Technically, since Saudi did NOT own any oil & gas, it “dictated” Aramco prices by imposing higher artificial prices (so-called “posted prices”) on which Saudi assessed royalties and income taxes – and Aramco had to raise its prices to cover the so-called “tax-paid cost” in order to avoid “losing its shirt”!!!]

You could probably Google all the gory details by searching “Aramco advantage 1979” or “OPEC two-tiered pricing 1979.”

The rest of OPEC has never forgotten that lesson!!! [Most of them are just “there for show” anyway because everyone knows that Saudi has always been the only OPEC member willing to shut in sufficient production to make OPEC prices stick.]

So where does that leave us???

Every sophisticated investor in the world knows that if Saudi believes that hydrogen extraction OR ANY OTHER ALTERNATIVE ENERGY SOURCE will reduce the worldwide demand for oil & gas sufficiently to imperil Saudi’s desired level of crude oil exports (7.341 million b/d per the CIA’s latest estimate), THEN SAUDI WILL SIMPLY REDUCE THE WORLDWIDE PRICE OF OIL & GAS TO MAKE THE ALTERNATIVE ENERGY SOURCE UNECONOMIC.

So unless hydrogen can be produced so economically that its production costs ARE LESS THAN Saudi’s production costs which were only a few cents per barrel back in the 1970’s and 1980’s, then (ignoring for the sake of simplicity of analysis, the cost of transporting the hydrogen and the cost of transporting the Saudi crude oil to consumers, which would probably favor crude oil anyway) investing in hydrogen extraction is very dicey unless Europe, America, etc. are willing to guarantee hydrogen prices (which is a form of subsidization).

[NB: During John Karls’ spare-time “career” as a volunteer mega-fundraiser for UNEP at the personal request of the U.N. Under-Secretary General for the Environment (following his spare-time “career” in the 1990’s as the volunteer national treasurer of Eugene Lang’s “I Have A Dream”® Foundation), all of the foregoing information/opinion was routinely offered (sans the new hydrogen-extraction wrinkle) to mega-donors who were interested in funding green-energy research to alert them that the funding of lobbying for subsidies was just as important.]

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Patents and The Public Interest

When George Kunath and I (John Karls) attended law school half a century ago, Law School 101 taught that contracts are invalid if their enforcement would contravene the “public interest.”

For example, contracting with a “hit man” to assassinate someone would be unenforceable.

Patents are contracts.

The purpose of granting patents is the “public interest” in providing an incentive to inventors in the form of a monopoly for a period of time – 20 years in the U.S.

Accordingly, it is at least arguable in the U.S. (it would probably be a “case of first impression”) that an American patent for hydrogen-extraction would be invalid if the owner(s) sold out to a buyer, for example Saudi Arabia, that might simply want to kill the technology.

[There is available at http://discussingliberally-saltlake.org ... 562&t=1836 an American Bar Association paper on the “Five Most Publicized Patent Issues Today” which includes “patent trolling” – a pejorative term to describe patent owners who do not use their patents in their own operations, if any, but typically engage in litigation to harass business producers. This would NOT be the case with Proton Technologies Corporation’s hydrogen-extraction patents if it behaves the way it has promised (it would only be licensing, but presumably not harassing). This developing law on “patent trolling” is only mentioned by way of example for how patent law can evolve – and arguably should evolve when a patent owner is (or sells out to) a malefactor that only wants to kill the technology since that is NOT in the “public interest” for granting the patent contract.]

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International Complications

The previous section deals only with U.S. patent law, which is based on a national statute.

As a statute, U.S. patent law is not even based on British/American “common law” so it (including developing legal doctrines) would not even be indicative of what would happen in the U.K.

And the law of virtually all European continental countries is based on the Napoleonic Code (rather than English “common law”).

And virtually all of the rest of the countries of the world follow either English/American “common law” or the Napoleonic Code based on their colonial history or on being conquered/liberated by the U.S. in WW-II.

HOWEVER, notwithstanding all of the current publicity of how China violates patents and steals other intellectual property, there is a “Patent Cooperation Treaty” ("PCT") which has 192 country participants and which is administered by the United Nation’s World Intellectual Property Organization ("WIPO") with headquarters in Geneva.

The advantage of the PCT and WIPO is that an inventor does NOT lose confidentiality with the first patent application filed in a particular country.

INSTEAD, the invention is protected in all 192 participating countries from the moment that an application is filed with any of the 192 countries.

The inventor still has to file with each of the 192 participating countries in which it wants patent protection – but it does NOT have to cope with the expense and logistics of filing all 192 (or how many ever it wants) country applications simultaneously.

Available at http://discussingliberally-saltlake.org ... 562&t=1835 are the texts of the Patent Cooperation Treaty, the PCT Regulations, the PCT Administrative Instructions and WIPO’s “core values.”

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Proposed Six-Degrees-Of-Separation E-mail Campaign

We take great pride in our Six-Degrees-Of-Separation E-mail campaigns to American or World decision makers which, with only a few computer keyboard key strokes, can be sent by each of our members (1) to the decision maker, and (2) to all of the member's friends and acquaintances requesting them to do the same in an unending chain.

[All 42 e-mail campaigns over our 14 years of existence are posted in the Section 1 of http://www.ReadingLiberally-SaltLake.org.]

Many have been surprisingly effective because we have developed such a reputation that we are regularly quoted (without attribution) in the media and decision makers quickly learn about our campaigns even if there are junior interns on their staffs whose job is to trash all incoming e-mails.

Our present imbroglio???

It would be impractical to ask our 162 members to initiate an e-mail campaign to decision makers in 192 different countries.

HOWEVER, an e-mail campaign directed to ONLY TWO United Nations officials would be practical.

It is suggested that the two U.N. decision makers to receive our e-mails be (1) the Director General of WIPO, and (2) the Under-Secretary General for the Environment (who also heads UNEP).

Our request???

There is nothing in the Patent Cooperation Treaty, WIPO’s PCT Regulations or WIPO’s PCT Administrative Instructions that addresses the case of a malefactor seeking patents in order to kill the new technology.

HOWEVER, WIPO’s “core values” include “Shaping The Future” – by “Seeing the Big Picture” and “Seeking Change and Innovation.” And “Acting Responsibly” – by, inter alia, “Demonstrating Integrity.”

Accordingly, it is suggested that we implore the General Director of WIPO and the Under-Secretary General for the Environment –

(1) to seek an amendment to the Patent Cooperation Treaty to treat as void any patent issued to a malefactor who wants to kill the new technology; and

(2) to encourage each of the 192 PCT member countries to amend their own country patent laws to treat as void any patent issued to a malefactor who wants to kill the new technology.

Respectfully submitted,

John Karls
JD, Harvard Law School, 1967
Who’s Who in American Law, 1988-2003
Who’s Who in America, 1988-2003
Who’s Who in the World, 1994-2003

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