DrumBeat: March 3, 2007

Mexican leader acts to increase dwindling oil production

In a bid to offset plummeting yields from Mexico's largest oil field, President Felipe Calderon unveiled plans Friday to boost production from a cluster of oil fields known as Ku-Maloob-Zaap.

He also announced an effort to speed its offshore exploration effort through an expanded technical cooperation agreement with the Brazilian oil company Petrobras.

Analysis: Demand to stress uranium supply

The high price of oil and natural gas, and the emissions of both -- plus coal -- sparking new mainstream concerns about climate change, has fueled a global nuclear power renaissance. Whether there's enough uranium to fuel the reactors, however, isn't guaranteed.

Canadian Firm Plans to Export Cuban Reserves

A Canadian energy company plans to export the reserves from Cuba's oil boom, a plan that could complicate the U.S. embargo on Cuba.

Analyst: Imperial Oil will lose 6% refining capacity

Consumers are griping that oil companies are have driven up gas prices at the pump amidst an Ontario gas shortage, but it’s not clear how the whole debacle will affect Imperial Oil’s bottom line this quarter.

Gas crisis? There's no gas crisis: Fuel-efficient car owners have the last laugh

Nick Sabouri, at Scarborough Lexus Toyota, says, "We get two kinds of people coming in looking for hybrids. One: environmental people. For them, price is no problem, they'll pay for the hybrid. Two: people concerned about the gas."

Family pumps up its anger

"We as a country need to send a message we're sick and tired of being controlled by gas companies," said Ron, a used car dealership owner. "We've setup a web site called boycottgas.ca and we're asking people to target one oil company per month and not buy gas from them. If we band together, gas companies are going to feel it."

Indonesia Rejects Proposal to Renew Gas Export Contracts

The Indonesian government said it has rejected a proposal to sign a new gas export agreement with Singapore and Malaysia.

"The rejection is line with the government's policy of giving priority to growing domestic consumption," Energy and Mineral Resources Minister Purnomo Yusgiantoro said.

Genome sequencing reveals a key to viable ethanol production

As the national push for alternative energy sources heats up, researchers at the University of Rochester have for the first time identified how genes responsible for biomass breakdown are turned on in a microorganism that produces valuable ethanol from materials like grass and cornstalks.

Initiative launched at UN to promote international biofuels market

Brazil, the United States, China and the European Commission launched a joint initiative here Friday to promote development of an international market for biofuels which are seen as a viable alternative to fossil fuels.

Who Still Loves Ethanol?

You see, over the past few months, we’ve seen some incredibly bullish indicators for the ethanol market. (And I’ll get to those in just a moment.)

But because last year’s correction wreaked havoc on ethanol stocks, many investors are cowering in the shallow end, afraid to swim--even though a good portion of the risk in this market is manufactured by doom and gloomers and those who have something to lose every time another gallon of the stuff is produced.

DOE, Interior Requests Vetted by Senate Energy Panel

"We will need to look closely at the need for a larger reserve, its cost, its impact on world markets, and its effect on oil and gasoline prices, before we authorize any such [SPR] expansion," Energy and Natural Resources Committee Chairman Jeff Bingaman (D-N.M.) and ranking member Pete Domenici (R-N.M.) said in the committee's advisory letter to the Senate Budget Committee.

Conserve magazine - “the new voice of doing more with less”

To meet the need for news and commentary on perhaps the greatest challenges facing the United States today – human-caused global warming and a projected energy shortage -- Conserve Magazine was launched today.

Peak Oil Passnotes: Stock Markets Tumble but Crude Holds Firm

But as the possibility of economic downtimes emerge, the general logic says that the price of energy should be negatively affected. But it is not. Why?

U.N. climate talks stagnate despite public worries

Governments are making scant progress toward extending a U.N. pact to fight global warming despite mounting public concern about climate change and U.N. warnings it poses a threat as great as war, experts say.

China and India face pollution timebomb

Beijing's eerily mild winter has provoked anxious media coverage in the Chinese capital. In India, the melting of the Himalayan glaciers that feed the country's great river systems is alarming policymakers. The world's two fastest-growing large economies are growing increasingly conscious of the global warming in which their rapid development is playing a part.

Dhaka to press for S Asian power grid

Earlier, South Asian Regional Initiatives (SARI), a forum of four countries – Bangladesh, Bhutan, Nepal and India – had proposed creation of an 80,000 megawatt (MW) power reserve to ensure a dependable supply of electricity to the member-nations. However, SARI’s objectives could not be realised due to India’s non-cooperation, sources said.

Oil refiners hit by 'the perfect storm'

Canada may boast of oil reserves second only to Saudi Arabia, but a "perfect storm" of refining problems has forced gas stations to close this week in both Quebec and Ontario and showed how precarious the day-to-day supply really is.

Shortages pushed prices up and sparked calls from some federal politicians for greater regulation. The trucking industry pushed for permission to work longer hours and use a restricted form of high-sulphur diesel to keep deliveries moving.

Falling oil prices will reduce Russian federal budget revenues

Russia's federal budget incomes this year will go down by 170 billion rubles (6.5 bln U.S. dollars) due to falling crude oil prices and a reduction in the GDP, Finance Minister Alexei Kudrin told the Cabinet on Friday.

India: Breaking power-lock

Currently a small proportion of the installed power capacity in India, renewable energy has a long way to go before hitting viable levels.

Chavez proposal puzzles analysts

Venezuelan President Hugo Chavez's proposal for a South American organization of natural gas producers based on the oil-exporting cartel OPEC has baffled analysts.

Brunei's record impresses TOTAL

Oil and gas reserves in the world would begin to decline in the second part of the present century while the present supplies would last 15 to 35 years.

Pakistan: LPG base price reduced by 4.2%

The improved rupee value in February led to the decline in the base stock price.

The Economic Coordination Committee (ECC) of the cabinet last year decided to link the base stock prices of LPG to the import parity price. The domestic prices were thus linked to Saudi Aramco prices.

Stunning New Novel Explores What Would Happen if Every Nuclear Power Plant in the U.S. was Shut Down

Magnum Opus, a provocative and relevant novel by Peter A. Thonet, imagines the next terrifying step in the energy crisis currently plaguing the United States. Disgusted with the ease in which politicians ignore the future of energy, Thonet's protagonist is determined to set things right. But he doesn't expect a formidable new adversary: a young San Franciscan sugar cane heir, who fights him at every turn.

U.K.: Silicon found in rogue petrol

Rogue silicon has been found in fuel blamed for causing damage to thousands of cars, trading standards officers confirmed last night, as mechanics were accused of cashing in on the crisis.

Follow state on warming, Congress told

California legislators want tough new federal limits that don't dilute local rules.

U.S. report sees steady rate of emissions

The Bush administration estimates in a report being completed for the United Nations that U.S. emissions of gases that contribute to global warming will grow in the next decade at a rate nearly equal to that of the past 10 years, The New York Times reported in Saturday editions.

Oil Companies, Seeking Reserves, See Iran as Long-Term Bet

Oil majors are laying the foundations for potentially lucrative energy deals in Iran, despite the risks, as they face tougher investment prospects in some of the world's other top energy producing countries.

In a signal to Washington that they won't bow to U.S. pressure to isolate the Islamic republic, many energy giants desperate to boost their flagging energy reserves are eyeing multibillion dollar Iranian projects that could give them access to some of the world's largest oil and gas fields.

OPEC expansion at risk if oil drops below 50 dollars

OPEC's 254-billion-dollar upstream expansion plan to raise production capacity risks being delayed if oil prices drop below 50 dollars a barrel, the cartel's secretary general has warned.

"My concern now is the price, because we are undertaking a lot of investment. If we don’t have a reasonable price then that investment will not be finished," Abdalla el-Badri told the Middle East Economic Survey (MEES) in an interview to appear on Monday.

Toyota developing plug-in hybrid, researching market

Toyota Motor Corp. is working on developing a plug-in hybrid vehicle and is open to joining with other automakers in battery development, the president of its North American operations said on Friday.

Big Profits, Big Worries in Oil Fields

Oil companies have made super profits the last few years thanks to record high oil prices. Chevron, the second-largest American oil company, earned $17 billion in 2006. But oil is harder to find and more expensive to produce. David J. O’Reilly, 60, Chevron’s chairman and chief executive, spoke recently about the challenges big oil companies face in meeting growing oil demand, how technology has advanced the search for oil, the message behind Chevron’s recent ads and the lack of an energy policy in the United States.

Don’t jump the gun as energy price war begins

BRITISH GAS has fired the first salvo in what looks set to be a fierce energy price war. Its decision to reduce gas prices by 17 per cent and electricity tariffs by 11 per cent has already triggered a response from rival energy companies.

Ethanol to bump up food prices

Ethanol will devour 50 percent more corn this year, eating into the food industry's share of the crop, the Agriculture Department said this week.

From breakfast cereal to beef to beer, competition from ethanol could raise prices for all kinds of foods.

Canada: Oil, grain prices now on same track: ag economist

Prices for grains and oilseeds have been steadily rising over the past year — and western Canadian farmers can thank high oil prices and the biofuel industry, a Saskatoon economist says.

India: Power situation begins to hurt productivity

The power situation in the state has begun to hurt the industry. According to Pawan Goenka, president, automotive, Mahindra & Mahindra, the company lost production of about 400-500 vehicles during February due to power cuts. “Although the power cuts didn’t affect us directly, several of our suppliers were hit. Since we work on minimal inventories, any delay of supplies impacts our production,” Goenka said.

As gas is rising weekly, from $1.97 per gallon just a few weeks ago, to $2.29, what do you see as the tipping point? $3.50 per gallon?

When gas was over $3 per gallon, a small retail store that my sister worked at was getting ready to close, I saw more people hitchhiking than since the 1970s and many people I know are now making less money than five years ago, a computer consultant used to earn $70 per hour now is lucky to get $35 per hour. A friend who worked at HSBC for three years took a pay cut six months ago and was just laid off last week. And according to a woman on Financial Sense website, looks as if the gulf waters are warm already and she predicts at least two hurricanes to hit the oil infrastructure.

SanD: Here in Toronto we are as high as $3.51 US and there is absolutely no slowdown in demand for gasoline. During Kartrina we hit $4.00 US without a slowdown in demand.

I've said it before. It's a bit silly to look for a Magic Round Number, the world is far too diverse for that. Your computer consultant no doubt dislikes the pay cut, but with a wage of $35/hour, gasoline at $20/gallon, maybe even $40, would likely be preferable to no gasoline and no job, or only a minimum-wage job at the corner convenience store. Actually, my crystal ball goes fully opaque long before that kind of price is reached, making it really a bit pointless to speculate what the world would look like by the time your consultant was priced out of the gasoline market.

What is far more likely to ruin your consultant is a rationing scheme introduced by demagoguing politicians, which might well make your consultant unable to work, as he/she probably has to drive a lot. This is an important point that people who demand price controls choose to forget - if they can't get the gasoline, many of them will be earning close to $0/hour. Then again, under rationing, people would become outlaws and pay whatever it took: in the USA at the end of World War II - that time of supposed patriotic solidarity that foolish old folks like to reminisce about so gushingly and dishonestly - half of all the gasoline was sold under the table.

Now, at very low wages it's trickier. But there's still no hard, fast, bright line if the alternative is earning $0/hour. On the other hand, in populated areas, there's a minimum-wage job or three on practically every corner, and those jobs turn over many times a year. So it's usually not truly necessary to drive a long way. Indeed, the real problem might not be gasoline, so much as the existence of the job itself. Would demand hold up for the often outrageously overpriced - and therefore rather discretionary - goods and services typically provided by those corner businesses?

I don't believe you will see rationing this time. As this is end game, not tide me over, those that can still pay, will, those that can't enter the era of post-oil. As the poor consume very little, there will be no significant demand destruction. Those that can still afford it will burn every drop they can get.

I suppose you could use rationing a bit differently, although it might be a bit more tricky to implement. What I mean is that..
- You get a small, limited amout of gas for a low price every week/month/whatever
- If you need more than that it will cost you a LOT more

There are also such extreme measures available such as sleeping either at or near your work place and returning home only on weekends. Or perhaps the whole system could be changed so that you work for a week or 2 and then have a full week of 'freedom'.

If you are paying an extra $20 to $30 a week for gas means $20 to $30 less for other things. Getting back and forth to work and for essential shopping is a high priority for most families. Easier to skip going to the movies than skip going to the gas station. Purchases for durable goods can be delayed until either prices drop or income rises. And durable goods purchases have gone down.

I have a sailboat on lake Erie. Most of the power boats in the area I sail are the larger cabin cruisers. These boats use lots and lots of fuel. The boat that was in the slip beside me last year had a 400L fuel tank I believe. My sail boat only has a small outboard motor. That's enough to get me in and out of the marina. What I have noticed was last year and the end of 2005 their was fewer power boats out on the water. Most of them just kept them tied up in the marina. Actually it was kind of nice, less noise, less large wakes, and less trafic in and out of the marina.

What is different this time around (gasoline prices rising) is that the backdrop of what is going on with the economy.

There are soooo many layoffs going on right now...and it is not just GM and Ford. My company (retail), Sprint, computer companies, IT companies...everyone is triming the fat off their staffs and costs. This has been going on at a lower level for the last two years, but the steamroller of layoffs is picking up amazing steam.

Companies are seeing the writing on the wall and know that if they don't cut all costs quickly, the bottom line at the end of the year will be horrible. Remember, retail companies measure their yearly success not only by sales profits but operating costs. Profits are meager to flat right now. Operating costs have skyrocketed.

Now, you add in the latest developments of the global stock market and increasing petroleum product costs and ask this question again.

What gasoline price is going to begin to hurt the consumer? Well, if you were a consumer last year with a job and some savings/retirement and this year, you are not, that magical price that will hurt you is much lower than it was.

Well $3 a gallon switched control of the US Congress, so there's definitely some movement at that price.

This winter I saw more commuter biking going on, and I'm talking about in the dark, on icy and snowy roads, and with a minus zero wind chill. These people are heroes in my mind. Were they doing it because they are car-free, or saving gas money, or trying to reduce their carbon footprint? I don't know. Also, a local restaurant owner recently said that when gas prices peaked last year, his restaurant was empty (moderately priced family restaurant). I think a lot starts happening at $3/gal gas. Our local food bank needs are much higher than ever, too. People keep driving, and then get food however they can. Now, the price of food is also going up...

a computer consultant used to earn $70 per hour now is lucky to get $35 per hour.

I wrote windows device drivers between 1992 t0 2002.

Let's see if litgation may prove more profitable?


In the basement, chopping some old cherry wood, which led thoughts of Kirschwasser - a fine source of ethanol, which then led not so naturally to a few other not quite minor BTU lowering aspects of ethanol. For example, that much delivery and production uses tank truck or rail, and not the more efficient existing pipeline infrastructure. Or that this road distribution leads to the importance of maintaining the road network, in a tight tautology - we need to drive, which means roads, and to have ethanol delivered, we need roads for ethanol delivery, otherwise we can't keep driving. Perfect logic in today's America, it seems. And then the idea that grain and oil prices on are the same track - amazing. We will simply switch, since no pain, no gain is the sort of slogan which sounds so early 1980s.

Basically, ethanol is an attempt to keep that dynamic American economy rolling, from industrial agriculture to exurban mortgage owners driving large vehicles to jobs involving the housing industry, to supporting global scale corporate enterprises, such as ADM - if you grow up around DC, the ADM ads are as omnipresent as those of the defense contractors.

And that attempt includes creating a new 'industry,' built at the peak of the era of the internal combustion engine, instead of creating the infrastructure required to adapt to a world where the current concept of wheeled mobility will not be applicable.

It is easy to be cynical about corn ethanol as a biofuel, a term which seems to be increasingly common in these discussions, which serves more to swirl different concepts into an acceptable way to keep the American Dream alive. Farmers growing an oil crop, such as rapeseed, which is then locally pressed and possibly 'refined' certainly allows agriculture to continue with the benefits of mechanization - what it doesn't allow is tax revenues for fuel purchases (even if farm use is less heavily taxed), it doesn't require much in the way of new infrastructure (diesels will run on plant oil in a pinch if it is above freezing, or the fuel system has been adapted), and it pretty much removes the importance of large corporate organizations in planting and reaping a harvest.

But such a 'biofuel' future is more along European lines - and the Europeans, at least the Dutch and Germans, seem to understand that biofuels are going to a major long term problem unless the market is carefully monitored. This is why it is so fascinating to read about palm oil plantations - OPEC member Indonesia, or oil producer Malaysia for example, planted massive amounts of palm oil plantations for the global food industry over the last 2 decades, but then came a wave of bad press - and now, reading about biofuels, deforestation related to those plantations is suddenly all about biodiesel, not junk food - palms don't start creating harvestable yields in under 4-5 years, according to an informative link at http://www.hort.purdue.edu/newcrop/duke_energy/Elaeis_guineensis.html#Ha... - in comparison, ethanol in the American heartland can be sold in the American media as environmentally friendly and as a step in the goal of attaining 'energy independence.' And this won't require anyone in North America to buy a diesel, which the North American car industry really doesn't manufacture anyways And the money stays where it should - in the pockets of the rich and powerful of the current system, the one about to hit the shore of reality - though just on the horizon, I'm sure there is a flood of oil waiting to crest higher than we can extrapolate from today's data - just believe in it, and it will come, because otherwise, Americans will have to start leading different lives.

That ethanol from sugarcane or another crop may offer a decent silver BB to keep some essentially gasoline fueled vehicles/equipment running until something better is available is one thing Thinking that essentially strip mining a large swatch of North American topsoil is an adequate solution to peak oil is just the sort of avoidance to what is happening which seems to mark America since the early 1980s. Which not so coincidentally, is also the last time the dream of an ethanol powered future died out (along with a massive wave of farmers going bankrupt - not exactly entwined), when the clear constraints and costs of ethanol production were no longer possible to hide using tax dollars and a major marketing budget.

Basically, the case against corn ethanol does not have to prove itself - the case for it, however, has a large (likely insurmountable with today's current understanding) burden of proof. Simply because feeding animals or people seems less necessary than driving into the sunset doesn't actually make it so.

And yes, if Ghawar is in decline, these are no longer theoretical questions - we will see just how much human life weighs against the need for Americans to keep driving. Welcome to the reality of suburbia. It's all good, or something equally banal - after all, if growing population is a problem, maybe every American driver using ethanol instead of gasoline can sleep soundly, knowing they are helping heal the Earth. Now that sounds like an American Dream.

Hello Expat,

Speaking of food to ethanol: I am not an expert, but it appears that farmers soon will be prepaid to grow special genetic strains with a low protein, but high starch content; good for fuel, but not fit for human consumption [maximum junk calories]. The 2-year prepaid feature guarantees the farmer won't grow food crops:
Guaranteed prices, cash advances offered for grain

Because the ethanol plant will require 15 million bushels (400,000 tonnes) of wheat per year when it begins operation late this year, TGF has been signing up producers to supply grain to the plant.

But TGF doesn't need the high-protein Canada Western Red Spring wheat that Saskatchewan is famous for. "We're promoting the farmer to grow the highest-yielding variety on his farm,'' Nolan said.

Low-protein, high-starch varieties, like AC Andrew, can produce 35-per-cent higher yields than conventional varieties. So even though the farmer gets paid less per bushel, he earns more per acre.

And there are even higher-yielding varieties specifically bred for ethanol production that could generate even better returns for producers.

"They're on the shelf right now. They exist,'' he said. "But they've never been registered because they don't meet the quality standards required for food production, said Nolan, who spent 33 years in the seed and grain handling business before joining TGF.

Also, because of corn ethanol, "Fertilizer is Sexy"
The combined demand of China, India and ethanol has drawn global grain reserves to more than 40-year lows.

Since June 2003, chemical fertilizer stocks have climbed more than 250%. In that time frame, Potash Corp. of Saskatchewan (POT) soared 474%. Mosaic (MOS) rose 336%. Agrium (AGU) rocketed 380%.

The segment as a whole has ranked in the top 40 of IBD's 197 industry groupings, most recently at the No. 1 spot.

What turned this seemingly feeble group fecund?

No. 1: the rise of fertilizer demand in China and India.

China's need to feed its 1.3 billion citizens drove it to become the largest global user of fertilizer products in 1986.

A second and equally important development has been the rise of demand for ethanol and biofuels.

The leading ethanol feedstock is corn. And among major U.S. field crops, corn is hands down the heaviest user of fertilizer, soaking up 1.5 to 2 pounds of fertilizer nutrients per bushel.

Today, farmers are harvesting the "government rows" of corn they once turned back into the soil — along with anything else they can get their combines on.

In the process, nitrogen-fixing crops such as soybeans, alfalfa and others, which recharge soil with nitrogen, are being set aside for corn-on-corn crop rotations.

That's good news for fertilizer companies. Fields that go without the nitrogen-fixing crop cycle are doubly sapped of the vital nutrient. Farmers make up the deficit with a double dose of manufactured nitrogen fertilizer.

It would appear that plans are moving into place such that if you don't have a two-year supply of food and a big woodpile for heating: you will be priced out by those wishing to drive [natgas + topsoil].

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Hmmmmmmmmmm.... Just checked my email and even on weekends Leanan now has additional competition. Whipple's new daily Peak Oil News under ASPO-USA auspices is published Saturdays also.

Well, you know what they say about imitation and flattery.

Whipple's issue for today even carries Stuart's latest piece.

The WSJ energy blog is about Pickens calling the peak.

They actually e-mailed us to tell us about it. Heh. Might want to go over there and leave a comment.

Ya, but they took us off as one of the blogs they are currently following. What's up with that?

Mark of WSJ is just spreading the love around the po'sphere to get more readers and links.

It's the links like the one above that matters to him (he doesn't have a blogroll, but a changing "what we're reading" set of blogs...I doubt he'll mention TOD more than once a week.) where he's getting name recognition.

Honestly, blogrolls are becoming less and less important. Instead it's live links (like what he's doing) that are the way things are going.

And at the end of the day, it comes down to content. If you click on a link and have a bad experience, you're less likely to go back the next time.

Good on him. He's been nothing but kind to us.

Oh no...I meant no ill feelings to the WSJ Energy. I just didn't know how they were working. I think we all appreciate his efforts.

It's easy to be flattered by their attention, but of course, the name of game is grab readership. But you know that.

Incidentally, I don't see wsj's energy blog in the TOD blogroll.

Why wouldn't he say the world has peaked if he is in the oil business and can get access to data. For instance , in 2004, of the giant oil fields of the world (that is a minimum of 500 mboe or 3 tcf of gas at discovery) 380 fields had less than 320 mboe remaining and 535 fields had less than 500 mboe remaining
Ghawar which had an original URR of 97 billion has now depleted by about 82 billion with ABOUT 14/15 BILLION REMAINING. THAT IS ABOUT 84/85% depleted,. Similarly, Iraq which has about 53 oil and gas fields, including 28 giants had URR of 85 MBOE but now has about 37 MBOE left. In 2003 there was about 41 billion left and the remaining 23 fields were below 50mboe so would be insignificant hence the approx.37 billion left today.
My information is that Iran is about the same but is of a private nature and can't be divulged.
This information above comes from M.K.Horn and Asociates from the A.A.P.G. sites and also relies on another 35 sources as stated in the articles.


Unlike many who post here with nothing to back it up, the first link gives all 28 fields, their Lat. and Long. Date of discovery, depth, reserves remaining and other information. The second link gives very interesting information on all the big oil fields around the world.

Note the references that have been used to compile this data. Note also he says that as at early 2004 Ghawar had depleted by 79322 mboe with 17776 remaining

Note also, that a decade ago in the first article( now 14 years) the URR for the whole Arabian Plate was about 900 mboe so if we could find production from discovery dates for all fields and subtract from this figure we would probably get quite a surprise


Pickens says oil production at peak

Associated Press

DOHA, Qatar - Legendary Texas oilman T. Boone Pickens sees today's stubbornly high oil prices as evidence that daily global production capacity is at - or very near - its peak.


If somebody is bored this weekend and want to have a good laugh, check this out:


You will discover ideas such as the C-decay that is explaining why we think the universe is so old but is in fact very young:
A continuously changing speed of light, which would explain both the age of the universe (and earth) due to radiometric dating, and also indicates that the doppler shift, the common method of dating far objects, is not caused by kinematic or relativistic red shift. This cosmology has the merit of explaining quantized red shift, which present cosmologies fail to do.

... changing speed of light, ...

It's sort of fun to think of the universe in anamorphic terms sometimes. That is to say, if the Earth is flat, how does light have to bend around and how do the planets move in order to appear as they do?

About 1000 years ago, we had this notion that the planets follow wild cycloid curves like a spirograph. Eventually, Copernicus found the simplifying assumption that they revolve around the Sun (the Greeks knew this 2500 years ago but the knowledge was lost).

Then around the beginning of the 20th century Einstein came up with another simplifying assumption: the constant c.

So, when do we go back to the crazy epicycles? :-) :-) :-)

A couple of days ago we talked about the level of railroad service in the USA in the past. I have a Rand McNally world atlas published in 1960, in which each state in the USA has a full-page map. Interestingly, roads are not shown on those maps, only railroads. Note that this is from a time when the interstate highways were already being built. There is even a separate map in the atlas, of the whole US, showing the major highways. But the state maps apparently show the "peak rail" situation from the 1950s. And in many areas it seems that almost every small town was served by rail. I havn't been able to scan these maps, but took some digital photos. Low-res (70K) versions linked here. One of the NW 1/3 of Ohio. (The area in the image is about 130 miles from top to bottom.) Lest you think only the old industrial heartland was so served, check out the less populated Western Iowa or the somewhat less developed Coastal Georgia. (These are in somewhat different scale.) If anybody wants more or higher-res images let me know.

That's very cool, and I cannot help but think that rebuilding this is one of the key things we should be doing. It's very frustrating that we aren't.

Beyond the energy efficiency of rail transportation, I would love to be able to ride to work. Like I really enjoy the driving commute I've done a thousand times, watching the traffic back up, trying to keep the jerk in the Lexus with the suit and the cellphone from cutting me off.

The Iowa map cut off the bottom few miles including Lamoni where I live. It's in that dip between Davis City and Kellerton in Decatur County. The city used the old R.R. route to make a bike/walking trail over 3 miles long. An overpass where I-35 crossed the tracks is still there. The old depot was renovated into a city hall. A old R.R. bridge over a creek is still there and is one of the more picturesque places in town.

There is planning underway to take some old Rail Right of Way that looked to be destined for Hike/Bike, up through western Maine, and revise the plan for getting both uses from the passageway.. best of both worlds, if you can make it safe. In a rail-heavy transp system, I'd think there would be a need to have a service roadway accompanying the tracks, (ostensibly the Bike/Hike path. ( But that thinking might be only an outgrowth of my having grown up with 'road access' as the pinnacle of a support system, which may no longer be as supportable as multiple line railway.. )

Bob Fiske

The old depot was renovated into a city hall.

That's what they did in the town closest to me. They only moved it a few feet to the edge of the RR right of way, and i suppose in the future if it were needed for a stopping point for passenger service, all they would have to do is put an awning over a slab on the back of the building. Hope springs eternal!

I have a 1912 edition of the Encyclopedia Britannica, and in it each state has a fold out map displaying all railroads, towns villages, and rivers. There were more railroad tracks in Iowa in 1910 than are shown in 1960. My wife is from Shenandoah, so I have been to the depot in Shenandoah a few times for an evening meal and a few beers. The depot has been changed over to a restaurant. The ticket window is now the pay your bill window.

Yep, I remember having maps like those. Today's "maps", the online versions, may or may not have railroads. Google Maps does not (that I could find), though Encarta does.

E.g., look up western Iowa on Encarta. You can see those tracks are still there.... today they haul corn and beans, used to be to the great river cities, but these days I suspect it is to the ethanol plant (for corn anyway.)

The existance of these rail lines is one of the reasons some people, in their dystopia-light version of post peak scenarios, see a reverse migration from the cities into the rural areas and the reemergence of the farm+rail way of life for America.

Thanks a LOT !

Perhaps I should troll eBay for another copy :-)

Best Hopes for "If we did it once, we can do it again !",


Anyone have a good reason why gasoline prices are going up so quickly? The only problem I know about is the refinery up in Canada...is that actually affecting throughout the US?

In the US, we have drawn down product inventories by about 90 million barrels since early October.

In February, we hit all time record high consumption levels, and we drew down product inventories by about one mbpd.

At the end of February, product inventories and total petroleum imports were the lowest we have seen since 2004 (2/07 compared to 2/04).

In other words, we are presently meeting US demand for refined petroleum products by drawing down inventories are a pretty rapid clip.

At the same time, we are now seeing significant declines in world petroleum exports.

IMO, we are starting a much tougher round of bidding for declining world export capacity--against regions like China and the EU, rather than regions like Africa.

I don't think that it is a coincidence that the US Personal Saving Rate went negative, in the second quarter of 2005, just as oil prices spiked. As I have stated before, IMO, the US, in aggregate, has had to go further into debt in order to outbid regions like Africa for declining petroleum exports.

WT: Also, Ontario, Canada inventories are zilch (also Quebec inventories are being drawn down) so if the gasoline inventories were reported for USA and Canada combined I am sure the number would be even more bullish for prices.

Anyone have a good reason why gasoline prices are going up so quick?

Three things. First, finished product demand is at record highs for this time of the year. So, refineries are coping with much higher levels of demand than expected. Second, turnaround season is coming up quickly (really cranks up this month) and refineries are stockpiling product so they have some to sell while they are down. Third, we are coming to the end of winter gasoline season, and this reduces gasoline supply by taking butane out of the gasoline pool.

This is why product inventories are being drawn down, even as crude inventories remain high. I expect to see imports of finished product start picking up, and imports of crude will probably stay low until May and then pick up (just like last year).

"finished product demand is at record highs for this time of the year"

- but why? Any theories? Is it just the general "growth" trend or a more sudden shift? If the general trend did not cause such a price at this time in previous years, could this year's early price rise be a signal of limited supply relative to the predictable demand growth, i.e., a signal of Peak?

Finished product demand continues to outstrip refinery capacity additions. Yes, it is just the general growth trend. This is a downstream problem. Peak would be first manifested as an upstream problem. You would see crude oil inventories start to fall, or prices spike up sharply as people struggle to keep them filled. But the crude supplies are adequate. We just can't push it through the refineries fast enough.


That I assume is the much talked about "refinery shortage" issue that everyone here gets mad if you talk about. "Your just making excuses to hide the real crude production declines", they shout....

But realizing that we have a refinery problem in no way undermines the "peak oil" issue per se....and the problem of declining crude oil quality (heavier sour oil) only makes the matter more problematical.

A real issue to me is investment capital....let's admit it, heavy sour crude oil refineries are never going to be the "glamour" investment of the "green world", and ethanol plants, windmills and thin film solar have the buzz right now. Where does an oil refiner get the money to invest in building or expanding a heavy sour crude oil refinery?

Because even if "conventional" crude oil still has some time to go before peak (and we don't know, just saying IF), we can be pretty sure that light sweet crude will get to peak first, and may have gotten there several years ago.
We will need heavy sour refinery expansion to get us to the next stage, and will have to find some way to finance it. "Freedom oil bonds" anyone?

Roger Conner
Remember, we are only one cubic mile from freedom

If you are correct what I want to see is Gas & Distl imports increase substantially this week. There has been sufficient time for product suppliers to respond.
Also a question for you, production of Gas plus imports are about 500KBrl’s/day greater than demand, so why are stocks being drawn down? What in the process do I not understand?

Iran touts nuclear prowess with new banknote

Iran is to issue a new high-denomination banknote marking the country's achievements in nuclear technology at a time of mounting tension with the West over its atomic programme, the IRNA agency reported Saturday.

The new 50,000 rial note -- at around five dollars worth more than twice the value of any other note in circulation -- sports a picture of the standard nuclear insignia of electrons in orbit around an atom.

"If the science exists in this constellation, men from Persia will reach it," says the calligraphic legend beside the atomic orbit, quoting a saying (Hadith) they attribute to the Prophet Mohammed.

On the front of the note is a picture of the Islamic republic's founder, the late Ayatollah Ruhollah Khomeini, which according to the law must be on all Iranian currency.

Iran has defied UN demands for a halt to sensitive nuclear activities and instead has pressed on with its atomic programme which has become a source of national pride.

The head of printing at the Islamic republic's central bank, Jalal Jalilian, denied there was any link between the issuing of the note and rising prices of basic foodstuffs in Iran.

"Bank notes are a medium of exchange and (their printing) has nothing to do with depreciation of the national currency," he said.

The government of President Mahmoud Ahmadinejad has been criticised by economists for expansionary policies that risk fuelling inflation. Prices of poultry, red meat and vegetables have risen in recent months.

The official rate of inflation is put at around 13 percent although unofficial rates put the figure much higher.

JHK's got his March 5 entry up...

Evidence now conclusively shows that Saudi Arabia's oil production was down 8 percent in 2006 over 2005, even while the number of oil rigs went up substantially -- indicating that the Kingdom is drilling as fast as it can and still losing ground.

The bolded words link to Stuart's piece yesterday.

A copy of one of my posts on the Saudi thread:

A key fact: On Khebab's HL plots for Texas and Saudi Arabia, Saudi Arabia, in 2006, was at the same stage of depletion at which Texas started declining, in 1973.

The following graph is based on the foregoing observation:


Another fact: Saudi Arabia showed declining production at the same stage of depletion that Texas started declining.

Another fact: the Saudis have dramatically increased their drilling.

Another fact: the Saudi production decline corresponded to the highest (nominal) oil prices in history.

So, in Texas, in 1973 we saw the following:

Higher Oil Prices + Increased Drilling = Lower Crude Oil Production

In Saudi Arabia, in 2006 (same stage of depletion as Texas in 1973), we saw the following:

Higher Oil Prices + Increased Drilling = Lower Crude Oil Production



So whats new:

drill more

find less

Ultimately , this is a common concept in an oil prone region that has gone beyond peak.

Its called geology.

Keep at it Westexas: PETROLEUM GEOLOGY 101.

Students of Economics : you must attend this course...

I think westexas point was: it is now proven by facts from observation in the case of KSA.

Yes, we know how the theory goes.

But until we have facts from the ground, we don't know how each region is doing right now (at least not with high probability).

This data + HL models + some above ground shenanigands together point to the fact that this depletion is real, below ground and as you said, based on geology, not (above ground) politics.

The more real world data we have, the better the argument sinks into the population at large (or at least, those that matter).

See Down Under's comments upthread for some data. In fact, anytime Down Under speaks (writes) we need to listen closely.

Does a study of the EROEI over time of a single oilfield exist?

That wouldn't be well defined (pun intended). To develop a specific field you'd need to invest a lot initially, in both money and embedded energy, in exploration, drilling, laying pipes, etc. Then eventually you settle down to a period of plain pumping. Does that mean the EROI then increases? No, it's just a time delay between the input and output. You may say that as the field ages and secondary and tertiary recovery efforts are used the EROI decreases, but how would you decide what inputs and outputs to include in the data for a given time point?

I am mainly interested in the changes over time, so anything that is used during the lifetime of the field can be spread out over time. The input consists out of this constant cost (possibly in incremental phases) + the continuous operating costs (that will probably increase). On the other hand there is the output, that is easy to measure - but that will decline.

The latest Sierra Magazine issue had a photo which speaks for itself:

Do they say what are doing these cars out there?

Rusting away!!

Eternal Parking Lot (in Montana)

there's a place in nebraska, near alliance, carhenge, klunkers arranged to resemble stonehenge perfect for celebration of the solstice

How much is a cheap house in a small city in Montana?
D'ya have an idea? Because the landscape is very nice..

There are lots of these junk yards all over the USA where people can go and "find-your-own-part"

Hello TODers,

Recall that Jay Hanson in his Thermo/Gene Collision PDF predicts widespread anarchy relatively soon. I think Peakoil Outreach can do much to mitigate this if the youngsters of the world can be convinced of the importance of cooperation for Detritus Powerdown and Biosolar Powerup.

Currently, the Danish riots are misdirected: kids attacking police and wrecking energy embedded infrastructure. IMO, it would be much better if these young adults understood Peakoil ramifications and organized their energetic efforts towards Biosolar Powerup. They could be repairing discarded bicycles for charity giveaways, helping recycle or repair other objects or appliances, starting community gardens and orchards, helping expand mass-transit options, etc, etc.

These people, who call themselves anarchists, need to consider what they want to accomplish in the long term-- burning cars and buildings, and fighting police is a non-productive use of human potential-- it only adds to future blowback forces of Dieoff. I think it would be interesting to poll these people to see how much Peakoil knowledge they understand-- my guess is that it is very low.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

The Danish Govt. used helicopters and special forces landing on the roof to evict squatters from a building they had taken over and converted to a youth hostel in 1982. The building had been owned by the city (Copenhagen) but was sold in 2000 to a christian group which finally demanded the Govt. remove the squatters. There is another part of Copenhagen which was taken over by Hippies decades ago called Christiana, which was declared a free city within the city. This will be next as they are on PRIME real estate which would be very valuable if you could just get rid of the squatters. The youth hostel was a practice run as it was located outside the confines of Christiana. Also, I would suspect they are well aware of peak oil and can't wait for the "return to nature".

Hostel my ass. You make it sound like a bed&breakfast, I have seen pictures from inside the house after the squatters were kicked out. It would be animal abuse to let a pig live in the filth they did.

"This will be next as they are on PRIME real estate which would be very valuable if you could just get rid of the squatters."

I wish. The place is a center for drug dealing, and lacks basic sanitation.

"Also, I would suspect they are well aware of peak oil and can't wait for the "return to nature".

LOL! No what this degenerate filth wants to do, is to lie on their backs and mooch of my taxes.


Think Bulldozers. It's the land and location, not what's on it.

Being from Denmark I will point out that the TV pictures make the riots look much bigger than they really were.
Only about 1000 people took part, and only small parts of Copenhagen centered around the former youth huse and christiania were affected.

Due to their mindless vandalism the anarcists/anti-fascists/anti-current-government/anti-car/anti-everything have lost what little support they may have had in the broader population.
Among other they vandalised a school and a library, literally dragging the books out into the street to make fires.
The parallel to nazi book burnings is not lost on many.

Hello Hurin,

Thxs for a local viewpoint. This is what worries me: will the youngsters around the world accept their destiny, then be gung-ho leaders for the coming PostPeak transition? Or will they feel it is pointless to even try to optimize a bad situation and they will instead resist mitigative change?

Consider the Spartans at Thermopolae: they knew they were screwed, but did the best they could to give others a chance. Will today's kids pitch-in for Detritus Powerdown and Biosolar Powerup, or will they continue to burn books, waste taxdollars, tune-out with Ipods, and rage in the streets? IMO, it is very important not to amplify cascading blowbacks.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

The book burning really bothers me. Hippies of the '60's would have protected and defended access to all knowledge. If they are styling themselves after that era, they haven't a clue about what that movement was all about. And yes, outside of the idealists, most just wanted to not work, do drugs and have sex.

Book burning is bothersome, but then again, they're self-described anarchists.

I mean, what more do you expect from an anarchist?

Bob, you said,

"These people, who call themselves anarchists, need to consider what they want to accomplish in the long term--"

Teach me on this one, but isn't an anarchist who wants to accomplish things and thinks long term an oxymoron? :-)

Remember, we are only one cubic mile from freedom

Hello Roger,

LOL! Yeah, your right-- but I am hoping the short-term planning of anarchists can be modified into long-term plannning of realists-- all they have to do is readjust their mindsets.

I have no sympathy for these "young adults". Out-of-control adolescent rebellion heavily into drug use is my remote diagnosis.

Actually Denmark is in pretty good shape post-Peak Oil. They have cut oil consumption by 40% since 1973 (first replaced by coal for electricity, now a mix of coal & wind). They produce enough oil to meet their 1973 demand, so they can now export their savings.

The Global Wind Turbine industry uses the "Danish Design" and there would be NO significant wind industry without the Danes !

Copenhagen is #2 in bicycle use, second only to Amsterdam.

They designed and built a creative and quite economically "Light Metro" that forms a "Y" centered on old Copenhagen. Debate on building a circle line around old Copenhagen is ongoing. They also have old and well established commuter rail lines into Copenhagen, they just built an electric rail line & toll highway to Sweden (with the rail station at the Copenhagen airport; Metro subway, international rail and airport all together) with talk of a direct link to Germany (vs. current round about route).

The Light Metro was paid for by developing an old military base. They enhanced the value of this land by building an elevated section# of the Metro (one of the 3 legs) down the center of the old base, and are paying for ALL of the Light Metro from the land sales from this one leg. And all of the new development is very energy efficient Transit Oriemtated Development :-)

# I am intrigued by the elevated Metro section in Copenhagen. 60% is embankment (build two walls, fill in between and build a regular rail line on top, cheap & effective !). Plant ivy on the walls to cover any grafitti.

The viaduct sections are all uniform and cast-in-place (cheaper than off-site casting). The embankment section goes till a road crosses it, then a section of viaduct is cast to cross over the road and sidewalks).

Subway stations are holes straight down with skylights. Some subway stations are side streets that were just converted into stations (standard station is 12m x 60m from memory). Many above ground stations use glass roofs for minimal lighting during the day.

All of this was built for less (half ?) of what ti would cost in the US :-)

Best Hopes for Denmark !


PS: If they would just return ALL the books that they stole from Iceland, then they would be a nice country !

Nice to hear about that light metro, it sounds cool.

Alan, you stress the positive aspects, and I agree...but we should not forget that Denmark is nevertheless a very respectable consumer of oil (at .347 barrels p day for 10 people), which is higher than Germany, France, or Switzerland. It also guzzles natural gas, less so than Germany and the Netherlands, but it clocks it at rank 20 per capita (world), which is very high indeed. (numbers from nationmaster.)

Some links to their Light Metro (2.65 m wide 2 car trains, 100 seats, automated). Copenhagen has a metro population of 1.85 million people.

One striking thing is the design of the stations, both underground and above. LOTS of glass walls and ceilings and a very "open" feeling design. 100% Skylights for subways stations. I have seen some striking photos of above ground stations (most are elevated).


A map of current, under construction (light yellow) and planned (blue) Light Metro lines. Metro service is every two minutes at peak. (Stations are 61 m x 20 m).


Without future plans but commuter rail in red and international rail in grey


A word about future plans

The Danish government has accepted a proposal for a Metro circle line (The City Ring) to connect areas of the city centre which are not well-covered by the S-Trains or the existing Metro lines. The Ørestad Development Corporation predicts that the lines M3 and M4 will carry about 275,000 passengers per day. About 25% of these would be people who do not currently use public transport, meaning that rush hour traffic congestion should become much less severe in central Copenhagen. It will use the same station design and train types as the two existing Metro lines, but, unlike the M1 and M2 lines, will run entirely underground. Construction costs are expected to be around €2 billion, and it is scheduled to finish in 2017.

Future plans to extend the M4 to the suburbs of Brønshøj and Gladsaxe, and to industrial areas in the northern and southern end of the harbour are being considered

If oil becomes a growing problem, these plans can be speeded up.

Best Hopes,


PS: No one nation has perfect virtue (Even in Switzerland, the Germanic Swiss have to deal with the French, Italian and Romansch speaking Swiss) but one can, and should, point to the positive steps being taken as a guide to what can be done and how it can be done.

And the moon went red, the colour of Blood.

Anybody see the lunar Eclipse?



Your in the U.K., right? Because here in the U.S. Southeast, the moon is white as snow, speaking of which, even though we had no accumulation, it snowed like crazy most of the day, the wind howled (the last 3 days straight) and when it hasn't snowed it's rained....the drought has definitely missed Kentucky, and so has any hard hitting effects of a warming globe....we have had us a genuine winter here, complete with insane natural gas bills! Merry Christmas...oh, that's right, it's late for that....Happy Groundhog Day.....opps.....Never mind, time has gotten away from me again! :-)

Remember we are only one cubic mile from freedom

Not sure whether posted yet, an Economist article on ethanol:


This issue also has an interesting piece on Saudi politics etc.

The article says that ethanol costs 22 cents a liter to produce in Brazil and 30 cents in the USA. That's about a 32 cent per gallon difference. I don't think Midwest ethanol producers have much to worry about. Brazilian ethanol might soak up the east cost market, but truck transportation costs would likely make it prohibitively expensive for inland use if this article is correct.


How much money are you making searching for all of this material and posting links?

Who is paying you?

regards from senior citizen