DrumBeat: August 18, 2007

Demand-Side Economics

There are plenty of studies and books out there that purport to unravel the character of energy supply and demand, when in fact most of what's out there focuses on the supply issues. Last month, the Department of Energy released "Facing the Hard Truths about Energy," a study commissioned by the National Petroleum Council. The fruit of a year-plus of the labors of 350 experts convened in special panels yielded 422 pages, which certainly passes the heft test, but hardly clarified the matter nor, unsurprisingly, provided any dramatic insights. It is chock full of graphs and facts, and predictably has been roundly criticized by political opponents.

Top suburbs costing the Earth

SHOPPING has been exposed as the big culprit in rising water use and greenhouse gas emissions - and Sydney's most affluent suburbs are the worst offenders.

New data shows the electricity and water used to produce everything people buy - from food and clothing to CDs and electrical appliances - far outweighs any efforts to save water and power in the home, according to an extensive analysis by the Australian Conservation Foundation and the University of Sydney.

China's new middle class in love with cars - big cars

"It's a vicious circle - more autos, more roads," said Li Junhao, deputy chief of the municipal urban planning department in Shanghai, which has fought the automobile trend more than any other Chinese city by restricting access to license plates and taxing the use of cars in its downtown.

"There's not enough space for the cars or land to build the highways. The dream of Chinese here is much similar to your American Dream, no?" Li said. "It's just the same as anywhere else - you want a car and a bigger house, so you consume and pollute more."

Ultra-deep drilling for oil is simply a red herring as prices militate against it

To go ultra-deep as Kerevan suggests will require very high prices.

That is why the Russians are piddling in the wind over the deep Arctic.

The oil price would have to be well over $100 to make that economically viable. That apart, there is actually no real proof that there is oil and gas to be found there.

Des Moines Gas is Cheaper Than Eastern Iowa's

The other issue involves the Magellan Pipeline. It is not pumping gas to Johnson County. There is a gas shortage in Kansas. Fuel is going to Des Moines, but not Johnson County. So companies here have to drive clear out to Des Moines and back. The transportation cost is passed on to the rest of us.

Too early to tell fire's impact on gas prices

Local and statewide gasoline suppliers said Friday it's too early to tell what, if any, impact the fire at Chevron Refinery Pascagoula will have on fuel prices.

Mideast struggles to power area

An economically burgeoning Middle East is facing stark choices as it decides how to fuel its growth, despite sitting on two-thirds of the world's proven oil reserves.

Countries in the region are facing rising demands on electricity, natural gas and fuel oil as their economies experience rapid development.

Israel to renew Gaza fuel supplies after blackout

srael said on Saturday it will allow fresh deliveries of fuel into Gaza, after a freeze which plunged much of the impoverished Palestinian territory into darkness overnight.

...The Palestinian electricity company said on Friday that it had been forced to stop nearly all electricity production in Gaza because of the suspension of deliveries.

'Environmentally friendly' all the rage in world market

Big business fears that the fight against climate change will cost billions are now giving way to a different view: Green can be the color of money.

High gas prices push man to convert truck to electric

The pickup isn't a hybrid. It runs completely on 24 six-volt batteries. They power a direct-current electric motor.

He said the Nissan has a range of about 50 miles before needing recharging. When that need comes, Barksdale simply plugs an onboard charger into an outlet.

Tapping into the sun

Proponents of solar-powered water heaters in Ottawa hope local gas and electric utilities, builders and municipal governments take advantage of a federal pilot project to fund the energy-efficient machines.

Hydrogen power gets up to speed

Albert Gore III was clocked at more than 100 mph in a Toyota Prius. Perhaps police should be glad he didn't get his hands on a Ford Fusion Hydrogen 999.

Ford Motor Co. said this week that it set a land-speed record for a production-based hydrogen-fuel-cell-powered car when its prototype racer ran 207.3 mph at the Bonneville Salt Flats in Wendover, Utah.

All the Canaries Have Stopped Singing

Matthew Simmons, Chairman, Simmons & Company International guests on the Financial Sense Newshour.

Crude prices seen unmoved by global subprime woes: survey

: Oil prices are set to remain robust through next year despite the global markets shakedown in recent days, with banks and other institutions trimming their estimates marginally, according to the monthly Dow Jones Newswires oil price survey.

An Act of Economic Madness

A recent piece by energy expert Michael Klare, "Entering the Tough Oil Era," at Tomdispatch.com offers perhaps the crucial context within which to consider Cheney's urge to launch an air assault on Iran. If we are, as Klare writes, leaving the realms of "easy oil" extracted from the most accessible places in the least unstable and least troubled of countries, and entering a new era of "oil that's buried far offshore or deep underground; oil scattered in small, hard-to-find reservoirs; oil that must be obtained from unfriendly, politically dangerous, or hazardous places," if global oil supplies are already under intense pressure and oil prices ready to leap on any hint of possible oil disaster anywhere on the planet, then imagine what a major air assault on Iran before January 2009 might mean for the global economy.

Nicaragua to Study Electricity Saving

Nicaragua's energy sector will discuss a new rationing program amid little hope that the annoying power cuts may drop.

The Philippines: Peasant Group Calls for Review of Biofuels Law; Fears Possible Land Grabbing, Displacement

The militant peasant group Kilusang Magbubukid ng Pilipinas (KMP or Philippine Peasant Movement) called for the review of the Biofuels Law fearing that jathropa planting would intensify land grabbing and peasant displacement.

Cuba: Energy on the road to national liberation

ONE day in the not-so-distant future historians will be able to define the dates and routes that led to human beings’ definitive emancipation from the forces that, from the remotest times, have divided them into rich and poor, masters and slaves.

I have no doubt that, at that point, the efforts and leadership of President Hugo Chávez to construct an energy model of solidarity as the basis for winning real Latin American independence, the latter will have to be taken into account – among other extremely important events – as essential to the final push into the abyss of the old system whose paternity in terms of exclusion and social marginalization and dependence nobody questions.

Fiddling While Earth Burns - review of The 11th Hour

The deluge of depressing images and dire predictions from talking heads - 54 of them - with lofty titles like "Professor and Senior Fellow at the Center for Environmental Science and Policy of the Institute for International Studies" is relentless. And mind-numbing.

Just because the subject is dead serious does not mean the documentary has to be. "We are committing suicide," warns one dour expert early on in the film. Bleak stuff, indeed.

Hurricane Dean seen becoming deadly Category 5

Hurricane Dean is expected to grow into a ferocious Category 5 storm as it passes Jamaica and nears Mexico's Yucatan Peninsula and the oil and gas rigs of the Gulf of Mexico after it smashed into several Caribbean islands, the U.S. National Hurricane Center said on Saturday.

With top sustained winds of 150 mph early on Saturday, the hurricane center said Dean was a Category 4 storm, the second-highest level on the five-step Saffir-Simpson scale and capable of widespread destruction.

The hurricane center said it was expected to strengthen to Category 5, with top sustained winds in excess of 155 mph, before plowing directly over Jamaica toward the Gulf, home to a third of U.S. domestic crude oil and 15 percent of natural gas production.

No waiting game for oil companies

Some can afford to wait. Some can't.

Shell Oil is not taking any chances. Especially with a hurricane churning in the Gulf of Mexico.

...Chevron is moving some workers from its deep-water rigs, but production is still on line.

ExxonMobil, BP and Valero Energy all say they are monitoring Dean, but no evacuations yet.

Russian Oil Production Up but Resource Nationalism Continues

Although Russian news agencies reported that oil production, which includes gas condensates, has increased by 2.8% to reach a level of 285 million tonnes in January through July 2007, the hidden crackdown by Moscow on the private oil sector continues. The Russian Ministry of Oil has reported that during the first seven months of 2007, overall primary oil refining increased by 5.2% to reach a level of 132 million tonnes, while gasoline output increased by 5.8% to 20.4 million tonnes. At the same time, total refinery production of the country has been around 35.7 million tonnes of fuel oil and 1.5 million tonnes of lubricants, respectively an increase of 5.7% and a decrease of 12.7%.

The dark continent - Power shortages have become one of the biggest brakes on development

SEEN from space, Africa at night is unlit—as dark as all-but empty Siberia. With nearly 1 billion people, Africa accounts for over a sixth of the world's population, but generates only 4% of global electricity. Three-quarters of that is used by South Africa, Egypt and the other countries along the north African littoral.

Alternative Energy: It's Not for Everybody: Clean energy for one country could spell disaster for another

Before I go any further, I'd like to say one thing right up front. I think alternative energy is a grand idea. I have fantasies about my country's deserts (I'm American) being covered by massive solar farms, and my nation's long and beautiful coastlines sprouting windmills by the thousands. I have Sci-Fi visions of millions of zero-emissions vehicles clogging America's roads in gloriously carbon free traffic jams.

But the embrace of clean energy by some could mean economic depression for others. After all, what are all the countries whose economies depend on fossil fuel exports going to do when technological advances and the threat of climate change eventually makes their main source of export income obsolete?

Africa: Oil & Gas Discoveries - the Implications

Relatively recently, oil and gas discoveries have been announced in more than ten African countries. These include Uganda, Ghana, Congo-Brazzaville, Angola, Gabon, Guinea-Bissau, Guinea, Sierra Leone, Algeria, Egypt, Cameroon, Nigeria, Tanzania, Zambia, Namibia, Sao Tome and Principe. This is great news for our continent.

Planning for Hard Times Peak Oil Conference

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Air travel latest target in climate change fight

The statistics look ominous. Aviation currently contributes about 3 percent of global carbon emissions, but air travel is growing at some 5 percent a year, meaning numbers of air passenger kilometers will triple by 2030. Boeing estimates that aircraft numbers will double to more than 30,000 in little more than a decade.

Added to this is the complication that aircraft do not just give off carbon dioxide but nitrous oxide, thought to have at least double the impact of CO2, and condensation trails, which also may contribute to global warming.

Russian Bombers Resume Strategic Patrols

President Vladimir Putin said Russia permanently resumed long-distance patrol flights of strategic bombers on Friday which were suspended in 1992 after the collapse of the Soviet Union. After 15 years, once again we are on the brink of nuclear annihilation.




That profile of the TU-160 looks remarkably like the B1-B, the red stars giving it away. (I was a very small part of the B1 design many years ago)

Given Russia's access to crude oil resources and the facts that 97% of the US government's expenditure for fuel is for the Department of Defense, that 53% of this is for the Air Force, 89% being for aviation, and every $10 per barrel increase in crude oil increasing the aviation costs by $600M per year, what better way is there for Russia to "stick it in the eye" of the US? In the current environment that includes U.S. dependency on foreign crude oil supplies from politically unstable regions, IMO gearing all that cold war stuff all back up, including sufficient stockpiles to mitigate supply disruption, to match this global presence is going to make the U.S. response very, very expensive.

Perhaps with this development the urgent need to convert the civilian wheeled transportation fleet to electricity will begin making a lot more sense to a lot more people and we can begin making serious moves in that direction, including serious initiatives for light rail.

Prior apologies for pondering without facts and with a feeble understanding of the economics but:

Suppose every dollar Putin "invests" in projecting Russia's nuclear power globally results in a U.S. expenditure of $2 on a resource in a tightening supply and demand situation. This increases global crude oil demand and, given tightening supplies, drives the price up. Given that Russia is a supplier of this resource, Putin gets part of his investment back. Then, if he invests this return in more bombers and naval vessels, Russia can project more power requiring even more U.S. investment to project an equivalent response. Demand increases more rapidly, even more global capital flows into Russian coffers and the chess game continues.

Is this the beginning of the second arms race (really a fuel race) with a high likelihood being the rise rather than the fall of Russia (with China as the trump card) as a world superpower and the U.S. descent this time?

This is true insanity (not that insanity is limited to the Russian side by any means). I guess that Putin is resuming these flights to help his image with the Russian public, but I can't see what other good it would do. Nuclear chest-thumping might play well with the nationalists, but it seems like a huge waste of energy and money. Even if the USA can't respond with similar flights (because the USA is rapidly going broke in both energy and funds), if push came to shove there are still enough nuclear missiles in silos and on submarines to destroy the world several times over.

A nuclear war between the USA and Russia would be a lose-lose situation. About the only conceivable benefit it could have would be to reduce population pressure rather quickly.

Will the world ever learn?

"Even if the USA can't respond with similar flights"

The US never stopped. We have continuously kept Strategic Bombers in the air. That is what Putin was refering to in the article.

"The president said that although the country stopped strategic flights to remote regions in 1992, "Unfortunately, not everyone followed our example." Other states' long-distance strategic patrol flights have created certain problems for national security, he said."

[We have continuously kept Strategic Bombers in the air.]

What is your basis for that statement? Kept strategic bombers in the air in what capacity? How do you define 'strategic bombers"? I pulled alert in SAC in the 70's and at that time we had stopped airborne alert. Did we restart at some point and for what purpose? We certainly still have training flights, but that is not the same as continuously keeping strategic bombers in the air (which implies with other than training weapons) as we did in the 50s and the early part of the 60s.

You misunderstood. Perhaps an unfortunate use of words on my part. I did not say we have had bombers loaded with nukes circling Russia 24/7. We have continued to fly long range strategic bomber missions since the end of the Cold War, many of them with Russia as the focus.

On Sept. 27, 1991, President George H. Bush ordered the termination of Strategic Air Command's alert which began in October 1957 following the Soviet launching of the Sputnik satellite. The alert forces ceased operations the next day, beginning the successful conclusion of the Cold War. SAC alerts had been 24-hour, with precise requirements for ever-faster takeoffs dependent on the type of scenario in test.


Bomber command was transfered to the Air Combat Command of the US Strategic Command the same day. Since then we have flown "Global Power Missions" to demonstrate to the world our capabilities. Out of inertia or lack of another major target out there, Russia has been the focus of many of these Global Power Missions. I would imagine they have found that unnerving to say the least.


The B-2's ability to reach deep into enemy defense networks and disable command and control, infrastructure, integrated air defense, and other high value targets makes this aircraft a valuable force enabler. The B-1, the backbone of our conventional bomber fleet, will employ its high speed, maneuverability, and improved defensive systems to attack the next level of medium and low threat targets with large payloads of highly accurate point and area munitions. In so doing, it will strike the bulk of the targets attacked by bombers. The B-52's contribution early in a conflict will be limited to a standoff role, but will follow up with direct attacks on lower threat targets when enemy defenses are weakened. This combination of aircraft meets the mission requirements of geographic commanders while providing our nation the maximum return on its investment in land based airpower.


Since B-52's will act in a standoff role as a platform for cruise missiles, they would not actually have to enter Russian airspace to strike. Any approach of B-52's towards Russian airspace COULD be a prelude to war.
I'm sure we would not be happy if Russian bombers made habit of coming up to the edge of our airspace. Oh, that's right, I guess that's what's going to be happening from now on.

P.S. The Tu-95MS is also a cruise missile platform
(I'ld love to ride in the the tail-gun position in the Tu-95. The droning of the engines is hypnotic, like riding home fron the Drive-in in the back of the stationwagon as a kid. And it's cold with altitude. All bundled up, with that droning vibration running through the plane, they'ld have to wake me up if we ran into any action.)

I did misunderstand. The terms 'strategic' and 'continuously in the air' have particular connotations to me from having flown in SAC, so thank you for the clarification as well as the additional information.

It seems weird to think of a tailgun on these aircraft in an age of air intercept missiles. But I think the pilot's yanking and banking to avoid the first wave of missiles would probably wake you up pretty thoroughly were you in the tail gunner position.

Just to think they are turboprop in the age of air intercept missiles is strange.(and yes it would wake me up just in time to bail out.) ;)

This is true insanity (not that insanity is limited to the Russian side by any means).

More like a shrewd calculation on Putin's part. Remember, the US is going full-speed ahead with building a missile shield based in Eastern Europe and Alaska and designed to neutralize Russia's ICBMs and give the US the capability to launch a nuclear attack without the fear of having a subsequent nuclear gift exchange.

Having nuclear weapons based on strategic bombers and submarines is part of Russia's 'asymmetrical response' that would overwhelm the missile shield at a fraction of the cost, as described so eloquently at Putin's press conference in June.

IMHO, anything that the world community can do to contain the threat of US imperialism and reduce the risk of a nuclear war is a good thing. Note that the US is currently the only country whose military doctrine endorses the concept of a preemptive nuclear attack.

So let's see...

1) USA has been performing patrolling flights like these for decades now
2) USA is building an anti-missile shield obviously directed against Russia's nuclear deterrence

Given these 2 facts you think Putin's move is insanity? Why nobody bothered to call facts 1) and 2) the "insanity" they really are before that?


Chernobyl 'not a wildlife haven'

In April 1986, reactor number four at the Chernobyl Nuclear Power Plant exploded.

After the accident, traces of radioactive deposits were found in nearly every country in the northern hemisphere.
"Recent conclusions from the UN Chernobyl Forum and reports in the popular media concerning the effects of radiation from Chernobyl has left the impression that the exclusion zone is a thriving ecosystem, filled with an increasing number of rare species," they wrote.

Instead, they added: "Species richness, abundance and population density of breeding birds decreased with increasing levels of radiation."

The study, which recorded 1,570 birds from 57 species, found that the number of birds in the most contaminated areas declined by 66% compared with sites that had normal background radiation levels.

It also reported a decline of more than 50% in the range of species as radiation levels increase.
Professor Mousseau acknowledged Professor Baker's description: "It is true that the Chernobyl region gives the appearance of a thriving ecosystem because of its protection from other human activities.

"However, when you do controlled ecological studies, what we see is a very clear signature of negative effects of contamination on diversity and abundance of organisms.

Also Mobile species can and probably do move into the area totally unaware of the radiation only to die later. I imagine we don't have a reproducing resident population of species.

Cid, no offense intended but what you 'imagine' is not relevant. Many still 'imagine' our moon to be made of green cheese, while some still cling to the notion that the earth is flat...:)

'Imagine' my hand with most of it's fingers folded into a fist upturned. ;)

Would this imagination be 'Sid indicating his IQ'? :0

How could anyone compete with a schoolyard wit such as yours.

"I imagine we don't have a reproducing resident population of species."

Wildlife defies Chernobyl radiation

As humans were evacuated from the area 20 years ago, animals moved in. Existing populations multiplied and species not seen for decades, such as the lynx and eagle owl, began to return.

There are even tantalising footprints of a bear, an animal that has not trodden this part of Ukraine for centuries...


thats the OLD news article based on the OLD study that the parent post is pointing out that is flawed by pointing to a NEWER study on the same subject.

We can conclude that even though background radiation may be harmful to wildlife, it is far less so than the effects of sustained human habitation. So the articles are both correct.

We can conclude that even though background radiation may be harmful to wildlife, it is far less so than the effects of sustained human habitation.

That just doesn't make any sense. Background radiation is radiation that is present everywhere, all the time. You are never free of background radiation. All life evolved in the presence of background radiation. If you are going to debate the harm of background radiation then you must also include the benefits of background radiation. Background radiation is partially responsible for the divergence of life because is responsible for some, but not all, of the small mutations that make evolution possible.

I think it is pointless to debate the harm background radiation causes. It has always been there and it always will be there. What you must be concerned with is radiation that is above bacground radiation.

Ron Patterson

Deep breath, Ron...it's pretty obvious he meant the radiation from Chernobyl and not normal Earth background radiation. That is to say, if Chernobyl radiation and humans got into a fight about who could kill off more wildlife, humans would win. The animals that seem to be doing better are the larger ones that humans readily kill off or destroy the habitat of...they are doing better against the radiation than they were against the humans, but worse off for having the radiation than they would be without the radiation.

No, you take a deep breath Sub. I am well aware of what he meant. My point was that he was using the wrong term. Background radiation has onely one meaning. You cannot use the term "background radiation" when you are talking about something other than "background radiation". It is a little like using the word "literally" for a metaphore. As in: "We literall beat the crap out of them." That must have stunk up the place.

If you measure the radiation anywhere near Chernoble you will likely get a reading that is above normal background radiation. And if you continue measuring as you move away from Chernoble the radiation will drop until you only measure background radiation. At that point you will have reached the limits of the contaminated area.

Bottom line, you should not use the term literally when you are speaking metaphorically and you should not use the term "background radiation" when you are talking about something other than background radition. Unswearstand?

Ron Patterson

Background radiation is the radiation in the "background" of a given area as opposed to radiation from a specific source. Fallout from a nuclear weapon is considered "background" radiation. Background radiation varies everywhere on earth, particularly related to altitude but also related to other environmental factors.

When they use the term background radiation here they are using it exactly as we used it at the Defense Nuclear Agency and the US Army Nuclear and Chemical Agency when discussing fallout radiation in addition to the natural background radiation.

In short, you seem to be confused about natural background radiation and background radiation.

"The greatest shortcoming of the human race is our inability to understand the exponential function." -- Dr. Albert Bartlett
Into the Grey Zone

Actually it seems you do not understand what the term means.
By the false definition you just posted people might as well give up on giger counters cause as soon as radiation is released it becomes background normal and thus harmless.

The actual meaning of background radiation is the very small amount that is Naturally present in the environment. This natural level is what life on this planet has evolved to survive under. When some country sets off a nuke or a nuclear plant has a accident like Chernobyl the immediate area or where the fallout lands becomes many times more radioactive then it would be compared to the normal background level by a artificial means. This is what is commonly referred to as radiation, This is what kills.

Apparently it does not kill that much. At least this is what the article showed.

Thinking in absolutes aren't we?
Sure they might not be on the ground rotting dead, But as the same article showed with the mentioned birds they are suffering by gaining bad mutations and i am sure some might even be suffering from other ailments as well. Or are you focusing too much on the nice picture of that horse?

The terrible myth that radiation is radiation...that all radiation is equivalent...was and is deliberately disseminated to assure public acceptance. Really, nothing of concern here, folks; our carefully selected and hired experts agreee much ado about nothing. Trust that we know best.

Especially, particulate v gasseous sources yield very different outcomes.

"Low-level" and "threshold level" assurances are also mostly the workproduct of spinmeisters.

Also, the successive, daughter products are far less studied yet very troublesome effects are known, just not disseminated. Who besides vested interests will spend the money to disseminate information? especially propaganda?

Recall that the horrendous effects of smoking tobacco were mostly known and disseminated [!] in the 1940s. Yet the data was then quashed and disappeared for 30 more years.

Best to take your own look at the subject.Results will vary with your own diligence and your own evaluation of source.

The scary part is that someone appears to have a vested interest in convincing people that radiation isn't really all that harmful. WTF! Maybe someone wanting to be able to use a new generation of tactical nukes.

I work in the radiation protection field (as a Health Physicist).

I have never been impressed (and constantly appalled) by the way the MSM handles any subject. This article is no exception. Without actual data documenting what the exposure levels are, this is just fear mongering.

The paper in question is behind a pay wall, but the abstract give some hints.


"We conducted standardized point counts of breeding birds at forest sites around Chernobyl differing in level of background radiation by over three orders of magnitude. Species richness, abundance and population density of breeding birds decreased with increasing level of radiation, even after controlling statistically for the effects of potentially confounding factors such as soil type, habitat and height of the vegetation. This effect was differential for birds eating soil invertebrates living in the most contaminated top soil layer."

The phrase “ by over three orders of magnitude” implies that hot spots exist in the zone and that those spots are hazardous, but without the actual background radiation reading, both articles are pretty much useless. Also the question of chemical toxicity does not seem to be addressed. If I sprinkle heavy metals on your breakfast cereal, you are not going to be a happy camper, regardless of whether they are radioactive or not.

Here's an interesting site I ran across a few years ago about someone who motorcycled around Chernobyl: http://www.kiddofspeed.com/

Seems as if this site was a hoax, and that the photos were taken while she was on a bus tour


You'll notice on her site that the motorcycle does not appear in any of the photos taken inside the exclusion zone.

Such tours are still available, no need to be an outlaw biker:


This being said I think the site got lots of hits and raised awareness of the effects of the disaster

You'll notice on her site that the motorcycle does not appear in any of the photos taken inside the exclusion zone.

Actually, photos of the motorcycle appear here, here and here. Pretty sobering pictures; makes you wonder if this is how US cities will look like around 2100.

Interesting. None of the photos showing the motorcycle look definitively Chernobyl, though. They could have been taken anywhere.

One of the links to the Wikipedia article says she can't even ride a motorcycle.

The last one is definately NOT in the exclusion zone. Given Ukranian's climate 23 years without maintenance would have ruined any road. This one looks quite well maintained.

I did see those 3 pics, but they seemed too "generic" to me too. I've seen worse in rural Florida last time I was there... :}

Did you spend any time in the 80-90s as a contract H.P. tech type? {myself,37 refueling outages @ 17 stations,and a couple of years DoDfema@ Nightmare Island Radcon}

Never worked an outage. I was more hands on 15 years ago, but now I just fly a desk.

"After all, what are all the countries whose economies depend on fossil fuel exports going to do when technological advances and the threat of climate change eventually makes their main source of export income obsolete?"

Kuwait, a top world oil producer and exporter, is expected to be one of the world's exporters of electricity generated from solar power by 2050, a professor at the Kuwait Institute for Scientific Research (KISR) has said.

Saudi Arabia is listed on the map of the top five places for potential photovoltaic generation of electricity around the world (Hydrogen).

Algeria Aims To Export Power — Solar Power
Goal Is To Send 6,000 Megawatts — About One Tenth Of Germany's Power Use

Oil Giant Venezuela goes Solar, on the streets.

Solar enegy panel powered lights now line Avenida Bolivar in central Caracas.


Indonesia: wind farm (PESP02119)

Slowely, slowely, the world is getting the message.

A new energy pessimism emerges

When "peak oil" theory was first widely publicized in such path-breaking books as Kenneth Deffeyes' Hubbert's Peak (2001), Richard Heinberg's The Party's Over (2002), David Goodstein's Out of Gas (2004), and Paul Roberts' The End of Oil (2004), [1] energy-industry officials and their government associates largely ridiculed the notion….

Recently, however, a spate of high-level government and industry reports have begun to suggest that the original peak-oil theorists were far closer to the grim reality of global oil availability than industry analysts were willing to admit.

If this was posted yesterday, then I apologize for the repost.

Ron Patterson

We did a dedicated thread on that article three days ago:


It has gotten picked up all over the place, though, which is interesting in and of itself.


My hunch is that The Oil Drum is quickly becoming the go to site for any reporters and policy makers interested in energy, in no small part thanks to your efforts. Drumbeat acts as a pretty good filter for news on almost any development in energy, and the real strength is the wonderful contributions by the readers. Most people here are very willing to share their expertise, and the Key Posts are a great way to get familiar with any energy subject.

The main flaw that I see is that it too difficult to find the exact Key Posts on various subjects in the archives.

At any rate, thank you to you and everybody here. Professor Goose and Heading Out invented something truly marvelous when they set up this site. Bob Ebersole

Sorry, I meant Klare's article got picked up all over the place. Google it, it's amazing. Asia, the Middle East, Europe, Africa. It's been reprinted everywhere.

And if I had a nickel for every time someone has sent me a link to it, I could buy a post-peak hideaway and retire. ;-)

Reference to some articles and/or reports certainly bear repeating..."gosh, if Klare thinks this maybe I should look a little more carefully and not just blow it off"... Ditto for the Krugman column in NYT a few weeks back, the Strahan interview a week ago and open letter of yesterday, and many others I here missed. Perspective matters.

Various Fed and State policymakers are putting in place rules and laws to incentivize conservation, efficiency and renewables. The is underway right now in NJ, for example. A sense of urgency is still the exception and not the rule, and that, IMO, is because the word is, while out, not yet 'credible' enough for the policymakers to take the necessary actions.

The link Africa Oil and Gas Discoveries-The Implications posted above is a must read article by anybody who is interested in the Less Developed Countries attitudes about the OECD countries and the newly found oil in various countries. It is the most thoughtful explanation of what happens in these countries in relation to development I have ever seen.
Bob Ebersole

Referencing Leanans post about the Russians and their continuing efforts to exclude most oil companies from a big piece of the Russian oil pie while nationalizing the pie...

The SCO (Shanghai Cooperative Organization) has been stressing long term agreements between consumer nations and oil/gas producing nations. Russia (SCO member) is attempting to get Eastern Eureopean nations to sign long term gas deals and, of course, the Eastern Europeans are resisting these efforts, thinking that they might get a better deal down the road. Cheney, while on a tour of some Eastern Eureopean nations, accused Russia of using natural resources as an economic weapon. The speech by Cheney seemed to be the beginning of what some are calling 'the new cold war.' Putin sees the US as a threat not only to Russia but to the entire world. Russia is following the lead of so many oil producers and is keeping more of the stuff for themselves...just as WT predicted in his ELM. Keeping more oil at home is the same as making furniture out of home grown lumber and exporting it...it is a value added proposition, but lumber exported is not a value added use of raw materials. Meanwhile, the US has used most of its oil so Cheney sounds like sour grapes when he complains about Russia and the disposition of Russian oil. As oil scarcity grows we will see many nations motivated to either make war to get the natural resources that they need or make agreements with owners of natural resources on terms not necessarily to the benefit of the consumer nations. All such agreements will add to inflationary pressures in the world.

If the US Government intends to make war on the rest of the world for oil and other resources -- and there is certainly credible evidence that is true -- then it will have to be done largely with imported oil.

Military requirements for energy resources should soon swamp the consumer demands, and yet the paradox is that gas prices continue stable (after the quantum leap from $1 to $3, that is)and the American public is continually hammered to keep consuming -- it is our patriotic duty to the economy.

So how does this play out? The consumer economy is destroyed to provide increased access by the military to energy resources -- to what end? Why would the consuming public want to pay for a military that secures energy resources for a destroyed economy that can't use them any longer?

I have my own opinions, but they tend to fit into the "conspiracy theory" category -- which I don't believe in.

Cognitive dissonance has reduced me to quivering blubber.

If you are correct, it's not a conspiracy theory, it's a conspiracy fact. No more cognitive disonance. Go ahead believe. You'll feel better for it in the morning.

the American public is continually hammered to keep consuming -- it is our patriotic duty to the economy.

That's simple.  Consume only American-sourced goods with few or no imported inputs.  This means cutting back as far as you can on oil, of course.

It's no more a conspiracy than the European imperialism of the Victorian era, a gang rape of Asia and Africa in which the rapists eventually were going to run out of easy victims. There was no central authority coordinating the land grabs, but the British were pre-eminent, and their intellectual gatekeepers created justifications that could just as easily be used by Frenchmen and Germans. At some point, these monsters started to blame each other for the shortage of unstolen nations, and with astonishing speed the advanced armies and weapons bought to conquer Africans began to enter into plans against one's own white Christian neighbors.

Now the worst part of this is that the citizens of these governments increasingly had a democratic voice. The more democracy they got, the more the leadership used imperialism to divert them away from attacks on privilege. This is what scares me about modern Asia, the biggest group success story since Victorian Europe. People proved in these situations that they would indeed burn up their taxes on imperial projects just out of national pride or very narrow interests in getting a colonial job. No future, indeed. When they finally went to war with each other in 1914, the armies were vast beyond modern conception, up to 10% of the entire population, meaning 1 out of 5 of all males. They were told the war would be short enough to prevent economic disruption and maybe they didn't even care.

Imagine how much worse we will be when it's about our cars.

I hope Hurricane Dean makes a Carribean tour, avoiding islands and heads back out into the Atlantic, odds anyone?

Very long odds on Dean missing all and heading back into the Atlantic. Once hurricanes pass the windward islands on a westerly track they almost always hit something prior to losing strength.

Zero, earth's rotation works against that.

Best realistic hope is that Dean is reforming it's eye (as hurricanes periodically do) just as it slams into the Blue Mountains. Forward momentun carries the Cat 1 mass into the Yucatan where is gives a good rain.

Second best is a devastating hit on the King Ranch between Corpus Christi and Brownsville.


Is it just me, or is everyone's Yahoo Oil price graph on the RHS stuck on Aug 10?

It's stuck. The problem is on Yahoo's side, and there doesn't seem to be any way to contact them to point this out.


“Lake Superior is less than six centimeters higher than its August record low of 182.97 meters which was set in 1926, and it looks as though the water levels may continue to plunge," said Cynthia Sellinger, deputy director of NOAA's Great Lakes Environmental Research Laboratory in Ann Arbor, Mich. "NOAA's lake level forecasts predict that there is a 15 to 20 percent probability that new monthly records will be set sometime this fall."

The global warming presentations I have seen all predict that the forest of Minnesota will dry up, burn, and be replaced by dakota's type grasslands. I wonder if the state will still be known as "the land of 10,000 lakes" in 100 years?

Jon Freise

Analyze Not Fantasize -D. Meadows

Oh, dear! Off topic again, not that Hurricane Dean won't affect the oil question, but...

My query is this: One hopes that H. Dean will play out without damage to lives, or infrastructure anywhere, but should a strike on the American coast occur, what sins, commissions, or omissions, in the U.S. today, will be attributed to god's wrath by neocon Christians?* High taxes on the criminally wealthy? Homosexuality? Creeping socialism? Female emancipation? Immigration? Employment law? Others?

I also think that the deity/'s (in case there're more than one), should put in an appearance right about now, and speak to all humanity, in the language of each individual. The appearance must be unequivocal, beyond fakery, and give us at least a clue as to how we ought to proceed. S/he/they might undertake to remove, once and for all, the ambiguities, interpretations, and downright porkies, peddled by our politicised religious leaders. At the same time, maybe it'd be a good idea to have those same gentlemen (they're mainly blokes aren't they?) raptured to er...well, somewhere else anyway.

Best hopes (plagiarised phrase) for a divine intervention.

* More likely to be a goddess, actually, given that the default gender for all earthly life is female. Adam's rib might better be described as Eve's.


One hopes that H. Dean will play out without damage to lives, or infrastructure anywhere, but...

Funny, I first glanced at your post and wondered what you had against Howard Dean! :-)

Some more excerpts from the article up top:

Analysis: Mideast struggles to power area
UPI Energy Correspondent

. . Some countries in the region are turning to natural gas to solve their electricity shortages, but gas carries its own downside.

“Natural gas might not solve the problem as some people may expect. Here is why: Huge amounts of natural gas are used for reinjection in the oil fields to maintain or increase production. If natural gas is diverted to produce electricity, oil production would decline. As a result, oil revenues, and consequently economic growth, will decline. Therefore, fuel oil is the answer. The problem is that the current refining capacity does not support the growing demand. The planned projects in Saudi Arabia, Kuwait, and Iran might not come on stream within a suitable time, leading to increased imports,” Alhajji said. . . .

. . . Despite the options on the table, the Middle East is likely to go through some hardship as it struggles to decide how to fuel its own growth.

“Even without the fuel oil problem, the region will experience electricity shortages, brownouts, and blackouts. Electricity shortages will hinder economic growth and stall efforts to diversify their economies. Tourism in some places such as Dubai might suffer greatly from electricity shortages, especially that these shortages happen at the height of the summer season,” Alhajji said.

I can't locate any figures for how much gas is being reinjected in Saudi Arabia (Shaybah, but where else?). But the bigger reason for the squeeze on natural gas supplies is increasing usage by industry and the population and declining yields of associated gas which follow from declining oil output (pick your reason for that from the usual drop down list). Also, they were slow to develop non-associated gas supplies because the profit margin on gas is much lower (or non-existant if it is all being consumed internally).

Gas that is injected to maintain a gas cap can be roduced when the oil reservoir is totally depleted. If you think gas prices will be higher in a few years and there is no current market, its a very good idea.

But the opposite problem may be true, the solution gas is expanding the gas cap because of lower reservoir pressures, and the gas must be used or flared. It would take some pretty specific knowledge of whats being injected where to determine that, and I'm fairly sure the Saudi's have contracts to prevent any contractors from revealing that type of information. Bob Ebersole

I'm no hurricane expert, but in the "what if" department, what if Dean does show the same kind of turn that Katrina and Rita showed:



You have the center track going way to far to the north atm. WTC has it striking about 200km south of the Texas border. Lets at least maintain some semblance of a non-biased coverage of this event! See:

Gosh, that (Khebab's map) really does show a bulls-eye hit on King Ranch in Texas!

Re: Matt Simmons' interview on Financial Sense.

The following link, under editorials, has all of his interviews listed, including yesterday's (plus an article that you may have seen before).


Matt gave a very sobering interview. In the first few minutes, he sounded a lot like Matt Savinar, worrying about wars over diminishing energy supplies.

He thinks that the continuing decline in crude oil production as shown on the EIA data tables is confirmation that crude oil production probably peaked in 2005. He thinks that the increase in natural gas liquids (NGL's) is temporary, partly because of some gas caps around the world being produced, as the oil legs in oil fields have become depleted.

A lot of discussion about shifting to rail and water transportation, and Matt is very interested in wave energy research.


Alan's plan is the only plan I've seen that provides immediate plan for cutting the US oil consumption and mitigating the peak oil trauma without goring anybody's ox and with current technology.

But if we go into a crash mode, for national security we are going to have to come up with a rationing program. My suggestion is to make it illegal to drive a car or light truck without at least two passengers. But that's going to be painful and a political nuclear explosion.

I suggest that everyone get their bicycles fixed up today.New tires, new brake pads, ect.
Bob Ebersole

Disagree. I'm not against rail, but as Stuart's work has shown, it won't make a whit of difference. More fuel efficient cars would have a far greater impact.

Even then more efficient cars or even switching personal transport to motorbikes won't make any more then a few years worth of difference. It would be Better to spend that same money and resource on getting the population to a lower level by any means(preferably reasonable means) and teaching those who are left that they are going back to the point in time where most lived their entire life within a small area and only the very wealthy/rulers/and the merchant class traveled long distances.

Electrifying our vehicles will do more than 'a few years difference'. Were talking about taking off almost 10 mbpd, or 45% of our oil usage per day! If we did that, NA would be a net EXPORTER of oil. That should clearly be the focus of any PO mitigation plan!

Your assuming depletion stands still..
you take that 10 mpd savings and within less then 10 years depletion alone will eat away at that savings to the point where again they will have to import to meet demands.

By the time depletion catches up, you and I will most likely be very old, or very dead. As 45% of the worlds oil is used just for ground based transportation, a subsequent 45% reduction in oil usage would me demand would be around 45 mbpd. Our depleted production would catch up at around, oh, 2040-5.

I seriously doubt it will take as long as 40+ years we are speaking of a well past peak country, combine that with the export land model that at the current level of consumption many country's will not have enough meet their own demand AND export to those who can't. You also need to take into account if one would reduce our own demand to the point that we can export, it would NOT in the least curb the depletion rate you would only be replacing internal demand by supporting another country's demand.

That is because unless you Replace this country's entire government with a dictatorship with a dictator in the know the temptation to sell your new 'surplus' on the oil market will over ride everything else. In our case they would not have the choice it would be sold(by the oil company's or other groups) as way for America to regain it's world center status and anyone who says 'wait lets save this' will be drawn and quartered in the arena of public opinion. And on this tide the political establishment will ride.

How does it feel to Fsck your own children in the matter eh?

You make a lot of assumptions, and we all know what assumptions do to people. Your assuming that the US would be the only country in the world to electrify their fleets: everyone else would still be driving an ICE. You assume that this change would occur over night: it would probably take 10 years to get the majority of cars to be of the PHEV variety. You assume that US will have lost its status as a world power, and would desperately try to reclaim it via selling our now found oil wealth, etc...

Give me a break!!

Politics is the art of the possible. This isn't.

Except maybe reducing immigration. There may be enough grassroots momentum to get something done on that front. But our corporately owned government is strongly for open borders, so it won't be easy.

As I pointed out in the comments underneath his article, his analysis was uncharacteristically and fatally flawed. He failed to consider the indirect energy savings (which exceed the direst savings typically), the elasticity of supply of rail, and to take a long time POV.

I agree that in the first four to five years, new Urban Rail will contribute little (existing Urban Rail will have a greater impact in the first few years than new build).

The bulk of the transportation oil savings post-Peak Oil will come from 1) reduced economic activity, 2) better fleet fuel economy 3) a shift from truck to diesel rail 4) bicycling and 5) increased density on existing public transit (probably in that order, with #5 & #4 ranking uncertain).

In a steady state economy (see #1) oil savings from a sudden shift to higher fuel economy cars would begin to run out of gas (pun intended) in years 7 to 9 as higher mileage users are more motivated to replace vehicle and by year 15 the entire fleet is nominally replaced (I drive a 25 y/o car so...). In a severe economic downturn, those years may be multiplied by 1.5 to 2.5.

By Year 5 the impact of new Urban Rail will begin to be felt with a near complete build-out of all currently known projects by Year 20 (high % by Year 15). Add perhaps a half dozen years for significant TOD (Transit Orientated Development) effects to take hold for each specific line. (In an oil constrained world, judging the timing of TOD is extraordinarily difficult. Some factors will speed it up, other factors, such as Depression, might either speed up or slow down TOD).

I see the two strategies as complementary from a time perspective. Better fleet fuel economy is the sprinter that soon runs out of gas and Urban Rail is the medium distance runner than keep going for a marathon, resulting in a society that can function well on a couple of million b/day or less.

If Jeffrey's Export Land Model is correct, better fleet fuel economy will not handle an annual reduction in available exports of -8%/year. #1 will be the primary response until such time a we can deploy non-oil transportation alternatives (including bicycles & NEVs and EVs.

Best Hopes for EVERYTHING (except CTL)


CTL = Coal to Liquids
NEV = Neighborhood Electric Vehicles

In another thread I recounted a conversation between Ed Tennyson & myself as to what was reasonable and cost effective today @ $2.50 gas in the Washington DC area.

1) Silver Line to Tysons Corner & a bit past Dulles (perhaps one or two stops past plans).

2) Purple Line Light Rail (two alignments were considered for a half circle around DC in Maryland, and it might be worth while building both post-Peak Oil, but questionable today).

3) Extend Amtrak's NorthEast Corridor to Richmond. Use for commuter trains.

4) 40 miles of streetcars proposed by DC DOT. Connect neighborhoods to each other and to DC Metro.

5) Extend Green Line towards Baltimore or use Light Rail (extend Purple Line)

6) New subway line in DC. Bethesda (Red Line station and western terminus of Purple Line) to Georgetown (NW DC neighborhood) down Connecticut Avenue and then over to Washington DC Union Station (new station opposite side from Red Line station). I forgot if he suggested K or M street. Perhaps single track north from there to New York Avenue station for cross-platform transfers from Northern leg of Red Line. (Ed is mailing me a map).

7) Light rail extension of NW leg of Red Line on old RR ROW with transfer to Red line at today's terminus.

8) Columbia Pike Light Rail

9) Misc streetcar feeders in the suburbs to Metro stations.

In toto, less add-on than the original DC Metro.

Ed pointed out that Montreal built their subway in just a few years. They brought in French engineers to design & build it because the mayor wanted it quickly.

In an oil constricted world, what would be the Urban Rail ridership and VMT (vehicle miles traveled) in the DC area ? All of this could be built in a dozen years or less.

DC would not be saturated with Urban Rail (especially the suburbs) but living w/o a car would be feasible for many and one low mileage car for a couple would work for many others.

Many suburbanites could get by with bicycles & NEVs on sale today http://www.gemcars.com

An example that could be replicated in many US cities.

Best Hopes for non-oil transportation.


Re: Extend NE corridor to Richmond.

What I'd really like to see is another high speed line between DC & Atlanta, via Richmond, Raleigh, Charlotte & GSP. If we could get high speed to Atlanta, then maybe the next step would be a NOLA/Atlanta line. With changes in Atlanta & DC, that would make it possible to ride high speed all the way from NOLA to Boston.

It already continues north to Portland Maine. It should go beyond that to Montreal or some part of Canadian rail system.

Should. Won't. Not a chance.

cfm in Gray, ME

CSX submitted to the Feds a "congestion relief project" (all the other proposals were highways) to build 3 grade separated tracks from Washington DC to Miami. One track for semi-high speed passenger service (100 to 110 mph) and two 50 to 70 mph freight tracks.

I think they by-pass Atlanta though. Stage II on N-S tracks ?

pdf at


Best Hopes fro Realistic Planning :-)


An advocacy group for semi-high speed rail in the south. Interesting map of proposed lines on website :-)


So what can be done to make this happen?

1) Write your congressperson to support the CSX application, even if bypasses it you. A useful model for the nation !

2) Talk about it, try to start a meme. This is a REAL plan with a price tag, etc.

3) eMail the group.

I am doing what I can on overall basis.

I am thinking about making a handout specifically on the CSX proposal ASPO-Houston.

Best Hopes,

Alan Drake

Here is a graph supporting Alan's points. You can see that in the long run the fleet efficiency needs to climb up above 100 MPG to keep the current number of miles traveled.

In the 5% case a more efficient fleet hands off well to light rail.

In the more rapid decline cases rail efficiencies are the only choices. (massive conservation efforts will be needed).


Jon Freise

Analyze Not Fantasize -D. Meadows


Excellent Analysis :-)

Best Hopes for all Oil Use reductions,



The main problem with your electrification of light rail is that our urban communities are too spread out! While the efficiency gains for rail vs cars is intimidating, you completely write off the enormous material allocation problem associated with moving everyone into walking distance of your spider web of light rail. For that reason, I think Stuart is 100% right in suggesting we would be better off increasing the efficiency of our cars by 6% per annum than focusing all of our resources on light rail. Thats not to say that we shouldn't do both, or not even try. Just adding food for thought....

Exactly. Just looking at efficiency doesn't make sense.

What do we need to know to resolve this question? It is really a question of will there be enough energy to keep the suburban homes habitable?

Not a comparison between new homes, but a comparison with the existing housing stock.

I would guess that suburban homes (2000 sqft) are an order of magnitude less efficient than an urban home (1500 sqft), and higher for an urban apartment (1000 sqft).

Suburbia has a lot of energy requirements:
Two vehicles per family, replaced every 10 years.
Longer required commute distances.
Driving required for necessary goods.
More surface area of less durable materials.
Higher heating cost.
Higher cooling cost.
More road surface per capita.
More sewer/water line distance per capita.

The low suburban density makes it difficult to transform. Neighborhood grocery/pharmacy is not viable because it cannot get enough foot traffic. Once people start doubling up in suburban homes, then it gets worse for the outlying suburbs that see a collapse in occupancy.

But this is just me guessing. It would be good to see a study of energy efficiency and what I think of as minimum expenditure to operate, comparison between several living forms.

Need to think about this a bit more. I wonder if Detroit or another shrinking city has studied the issue.

I found a study on the excellent Dynamic Cities web site:


Jon Freise

Analyze Not Fantasize -D. Meadows

I think that vast swaths of suburbia will become virtually abandoned, since the Export Land Model suggests that the decline rate in oil exports will accelerate with time.

Alan is simply pointing out how we built and maintained systems that moved people and goods around in years past with minimal oil input.

Published on 21 Aug 2006 by GraphOilogy / Energy Bulletin. Archived on 21 Aug 2006.
Net Oil Exports Revisited
by Jeffrey J. Brown

I propose a sort of triage operation: "tiny" homes and multifamily housing along electric mass transit lines. In my opinion, it is the only way that we can preserve some semblance of a civilized society. The suburbs are, by and large, a lost cause.

Pretty much my thoughts, except that it will take care of itself. As low-density distant suburbia empties out, the number of occupants per housing unit in city neighborhoods and within walking distance of whatever mass transit lines are available will increase. Extended families will move in with people that still own homes in more accessible places. Those who still have space in those areas will then rent out rooms to boarders. Homes will be subdivided to become duplexes or multi-family.

I doubt that there will be all that many "tiny houses" built. Once we really get into full fledged decline, there will be very little if any new construction going on. The one exception might be infill if there are patches of empty space in otherwise dense urban areas; that infill will probably be multi-family, it will be a lot cheaper for someone to rent or buy a unit in a multi-family building than a tiny house.

This will pretty much just happen as people do what they need to do. The only two things that government could do to help would be to: 1) invest in more mass transit (preferably electrified rail) NOW; and 2) more permissive zoning wrt number of occupants per home (or per room), accessory appartments, duplex & multi-family conversions & new construction, etc. What I described will happen, even if government doesn't do these things; they will just happen in spite of the government, not because of it.

The greatest misallocation of resources in history was American Suburbia.

J. Kunstler (see upper right rotation of quotes on TOD)

Yes and No.

Significant parts of Suburbia can be served by commuter rail (best if living close to a station).

A new line (dashed) will open next month on the coast SE of Boston. By my probably inaccurate count, 132 commuter rail stations. 55 to North Station, 77 to South Station (and no connection between North & South Stations, instead they built the Big Dig, $14+ billion for cars).

These commuter rail lines feed a network of subway lines in Boston.

Many close-in older suburbs can be served by Rapid Rail (subway) or Light Rail. Again close to the station in a walkable neighborhood is best.

Modern low density single use suburbia, where one has to drive to get ANYTHING is going to unworkable post-Peak Oil IMHO.

Too much energy to service (postal, police, street lights, water, sewer, pizza & UPS deliveries, et al) AND Americans are herd animals when it comes to housing. When 30% are vacant and uncared for, people will run out of there. Add repairs (most Suburbia is poorly built) that are a good % of the falling market value.

I saw small New England villages clustered around the MBTA rail stations above, the older homes within a half mile and modern sprawl in the distance. With a NEV, the modern homes are still probably workable if they are, say, within 5 miles of a village & station. But not as valuable as those within walking distance of everything, including the station.

New single family homes were 1,000 sq ft in 1950 (avg) and 2,496 sq ft in 2006 with smaller families. We have 2 to 3 times the sq ft to heat, cool and maintain than we need.

We also have many times the sq ft of shopping per person than other major nations have. Another waste concentrated in Suburbia and their shopping centers.

Best Hopes,


We would be better off increasing the efficiency of our cars by 6% per annum

This will work for a limited time (how long depends upon the decline rate (-8% per WestTexas) and how high unemployment gets). See the gTrout graph above.

But there will come a time when it will not be enough. When that time comes, Urban Rail can pick up the slack IF WE START BUILDING IT SOON. If not, the other alternatives are worse.

We cannot NOT dramatically improve our fleet fuel mileage, but that is not enough long term. And even if major improvements are made in EVs, I still think Suburbia will have a series of problems post-Peak Oil.

Best Hopes for ALL solutions (except CTL),


Well, we already know that our current generating capacity is enough for 85% of ALL ground transportation in the USA. We already have the infrastructure in place to transmit power over long distances to these vehicles, and several startups have now demonstrated that you CAN convert your vehicle to a PHEV with less than $10,000: cheaper than buying a fuel efficient new Kia!

Some people may not like it (Kunstler) but we are STUCK with this 'greatest misallocation of resources in human history). Do we really want to make an even BIGGER blunder by abandoning it all to rot away through slow decay and the spread of slums?

The tools are out there! The batteries are coming to the market. The political will is building. We HAVE the tools to transition our transportation network: not just with batteries, but with rail, increased efficiencies and good old fashion trip planning. The only question is will we realize the need to do so fast enough?

It takes on average 15 years to replace the car fleet: thats roughly 7% replacement each year. But what if we doubled that rate with a crash program, and combined it with an equal share of electrification? What if we did build a large amount of rail? If only....

we already know that our current generating capacity is enough

to barely service our current demands. Where are we goign to get the fuel fro running NG plants all night long ?

EVs larger than NEVs are going to take a significant upgrade in generation & transmission (and fuel ?)

A large number of people are going to recharge as soon as they get home, adding to the peak.

Rail electrification can be feed by a couple of years of lost load growth due to declining economic growth. Not true for EVs.

But what if we doubled that rate with a crash program, and combined it with an equal share of electrification? What if we did build a large amount of rail ?

We can only support a limited number of crash programs. Thus my choices:

Wind crash, HV DC & pumped storage Urgent, nuclear secondary urgent

Freight Rail expansion & electrification crash, Urban Rail crash, Intercity pax rail urgent, Bicycles crash, Electric trolley buses urgent, EVs secondary urgent/ordinary urgent.

Do we really want to make an even BIGGER blunder by abandoning it all [Exurbs and remote suburbia] to rot away through slow decay and the spread of slums ?

Actually demolition/deconstruction & salvage and conversion to orchards is what I prefer. A shorter and straighter path to sustainability.

We have *WAY* too many sq ft of poorly built and insulated housing# (and big box retail & shopping centers) that will need expensive repairs soon enough. Bite the bullet and do the right thing instead of desperately hanging onto something that cannot survive and prolonging the agony.

Do we really want to make an even BIGGER blunder by abandoning it all to rot away through slow decay and the spread of slums ?

Sounds like the gov't policies post-WW II for well built, efficient inner cities and downtowns. Turn about is fair play.

Best Hopes,


# we have 2x to 3x the sq ft that we need for housing & shopping. Think of the extra energy to heat & cool this !

USA is more of a continent then a country. You will have multiple crash programs and what makes most sense will vary between different regions.

It is probably not the choice of technology that slows you down. What do you need to combine your pre 1965 or so agility in investments with todays technological knowledge? What you did back then is technically easier to do now and can be done with less energy.

The most important crash program is probably to get people to accept change, get rid of red tape and retrain lawyers into engineers.


A large number of people are going to recharge as soon as they get home, adding to the peak.

If people just drive short-range NEVs, they do not need a huge battery pack. Design the battery packs so that they are almost as easy to swap out as the battery on a cordless drill, and then people could have two. While they are running at home, the other could be hooked up to a PV panel to recharge during the day. Instead of pluging in each evening to recharge, they would only have to exchage batteries.

Employers could also set up PV-powered metered recharging stations in their parking lots for employees with NEVs who otherwise might not be able to quite make the round trip with a single battery pack.

Putting in solar power and devices that use them is only part of it. People are also going to have to adjust their lifestyle patterns to match the daily pattern of insolation, so that loads become more closely matched with power output.

Design the battery packs so that they are almost as easy to swap out as the battery on a cordless drill...

The battery in my M-B 240D, which just used for starting, weighs about 60 lbs. A cordless drill battery weighs a bit more that 1 lb.

I cannot see a majority of Americans changing out a battery large enough to run an NEV daily.

Best Hopes,


Some might. Why close the door. Very short transit might just be well served this way. A key, IMO, is that we start to move to electric transit, be it cars or rail. And that means pushing all things that move by current. Niche markets may pop up. Most won't survive. But there is a need for an industry, and it starts always with niches.

First of all, lead acid might not be the way to go, there might be other techologies with more power per pound.

Secondly, the typical car battery was not designed for frequent changeout, so of course it is difficult to do so.

Thirdly, it doesn't have to be just one battery pack. I could imagine opening up a hatch to expose a rack with maybe a dozen slots. For each one, you slide away a retainer, grab the pack by the handle, and out it comes, weighing maybe 5-10 lbs at most. Each pack then goes into a slot in the recharging rack, and the replacement unit slides in to the vacated slot in the car. The whole operation need only take a couple of minutes, and the battery packs would be lightweight enough that anyone could do it. All this takes is some intelligent engineering and design.

By designing an NEV with multiple battery packs instead of just one large battery, you also provide more redundancy and reliability to the NEV. If one battery pack shorts out, you've still got the remainder of them to keep you running.

Yes to your comments.

No to all comments re EVs.

the 'burbs represent a tremendous energy "resource". now if we can just find a way to efficiently recycle all that vinyl siding, the peak oil problem dissapears.

Suburbia (large swaths of it, anyway) won't rot away, it will be dismantled. When lenders or municipal governments are stuck with a sufficiently large inventory of unsellable houses, they will sell them to salvage contractors for pennies on the dollar. The contractors will take them apart. There will be a market for used building materials as people try to up their home energy efficiency and convert single family dwellings into multiple family dwellings.

The asphalt on the streets and driveways will be mined -- America's tar sands.

The water and sewer and electric and cable and phone lines will all be pulled out, to be reused elsewhere -- municipal governments and utilities will find new supplies expensive, and will need to economize where they can.

Once all the housing and infrastructure has been salvaged, people can get to work on the long process of restoring the land to the market gardens, orchards and dairy farms that have traditionally ringed cities (and thus back to what these suburbs formerly were).


This will work for a limited time (how long depends upon the decline rate (-8% per WestTexas) and how high unemployment gets)....

But there will come a time when it will not be enough.

PHEVs can reduce liquid-fuel requirements by 80% with relative simplicity.  log(0.2)/log(0.92) = 19.3, so we could deal with the problem for ~20 years with PHEVs alone.  Most PHEVs could be converted to full EVs by replacement of the sustainer with more batteries (and batteries will get cheaper), so the liquid-fuel problem can be eliminated over perhaps 30 years.

To answer your responses to PartyGuy:

Where are we goign to get the fuel fro running NG plants all night long?

In the short run, fuel oil (many turbines are dual-fuel and turbines are more efficient than vehicles).  In the long run, wind, solar and nuclear.

A large number of people are going to recharge as soon as they get home, adding to the peak.

Not if they pay peak prices.  Of course, if they live someplace where the wind peaks in the evening, you WANT them to recharge then.  Let the utility control the chargers, with a user override for emergencies.  You need the utility control for grid stabilization anyway.

Stuart's analysis was based on existing attitudes, travel behaviors and market share. It there's one thing we can count on, it's that all of that will be changing over the next decade or two. The trends are already underway, even before peak, purely because of demographic reasons.

A more accurate summary of Stuart's conclusion is that fuel efficient cars would have a far greater impact over the near term. Here's what he wrote:

I think the far exurbs and rural areas, which are totally dependent on large amounts of gasoline powered VMT, will suffer the most and the worst in the future too. Obviously, there's no way that fuel economy will increase 4%/year without gas prices being sustained enough and high enough to cause people pain and change their mind about what kind of car they want to drive. That will have other effects also, including on where people live, but that will happen more slowly.

In general, I think the planning/land-use stuff matters over a long timeframe. There's not much you guys can do to make a difference over a decade or two, but you are critical over the century timescale. The land-use approach of the last 50 years is going to cause us problems for a very long time.

Actually what we might need is a few of these... (while we wait for 50 years to get the trains)


The link takes you to someone's electric bike project. Mostly, pictures of the modification sequence. It's pretty interesting, and from the looks of it, pretty easy to do.

Much earlier I posted that electric assist trikes will become the icon of aging baby boomers and the ULTIMATE un-cool mode of transportation !

The successor to Jay Leno will poke fun at them incessantly.

I include electric assist in bicycles.


Ebikes are the way to go! Here is a link to a lot of sources for DIY kits and stuff. With the market meltdown it is time to make sure you have your bike. See:

If you already own a bike that you like a kit is the way to go.

Solar1 I agree. But the majority of readers here cannot handle a simple, modest solution. There is a serious need to deny real change. So the solution is framed in substitutes: PHEVs, BEVS, NEVS...

In the end... the lightest, most reliable, personal transport solution will prevail. It won't be rail. The capital costs are too great and suburbia is too dispersed. And it won't be hybrid cars. Cars are dead. That leaves cycles, in various forms of course, but we'll get there.

In the meantime, this board's discussion will be mostly intellectual masturbation with respect to transport issues.

The technology freaks cannot see peak oil for what it is.

The car as a giant phallic enhancement, most likely, but something like the VW 1 Liter (minus some fancy composites) I think can be viable future transportation and preferable to a bicycle for long distance and adverse weather.


Sorry guys, Cheney is talking about attacking Iran as we speak, while Hugo Chavez is telling the world how he hates the USA. My telling people to fix their bicycle is the very cheapest, most reasonable insurance that anyone can take against the increasing odds that we get a cut off, because the army,navy, marines and airforce will confiscate all the oil and gas immediately for national security.

The blathering in congress together with Bush's promise to veto the Energy Bill ensures that it will be at least 20 months before we get CAFE standards increase and five years more to make a significant difference. Free market BS aside, how can we expect bankrupt companies to change? Sure car electrification is better, maybe, but when, and how do we finance it? That's pie in the sky technology too, not something off the shelf we can do now. And how will you sell electric cars to the oil business?

What I'm talking is practical and doable, and we can all work in our home towns for commuter rail and light rail. No need to wait for Wsahington to catch up, just go around them. But in the mean time, get a spare bicycle. For a hundred bucks you've improved your personal energy security.

Bob Ebersole

Since the Chinese are developing from a rather basic level, they have all manner of small, efficient transportation devices in production. Some of their electric scooters and bikes are rather impressive, IMHO. They are available today on eBay and there is even a local distributor starting up in my town. The Chinese are aggressively selling over the internet too. Here's some links:




Not that these would be useful in mid-winter, but, every little bit helps and when TSHTF, one of these "toys" might make survival much easier. They could easily be adapted to charging with some PV panels, as the more powerful ones have 48 or even 60 volt battery packs.

E. Swanson

All our bicycles now seem to be made in China too, so we shouldn't count on new ones being available in a prolonged crisis. Depressions create strong pressures for trade wars.

Or, when it all finally comes to pass, a lot of people might just have to walk. They'll whine and moan and cry all the way, but they'll walk.

And a year or so later, heart surgeons will demand that wellfare benefits be raised so they can continue in the style they are accustumed to, as their former and future prospective customers are walking by.

As far as I am concerned commuter and light rail is a no brainer. We need to use all green resources available including smaller electric cars and everything else that can be thought of. The objective is to change the mindset as the paradigm changes before our eyes. We have to get off of the oil fix if we are to survive.

I was lucky enough to be at the opening of the documentary "11th Hour" narrated by Leonardo Di Caprio last night in Hollywood at the Arclight. It was a packed house. Thom Hartmann was there too. We were treated with 20 - 30 minute live dialog and question and answer with him at the conclusion of the movie.

Although the term "peak oil" was not mentioned, Richard Heinberg and Thom Hartmann were in the movie and discussed issues related to the concept of peak oil and the effects of fossil fuels on the environment. Matthew Simmons is also listed on the website hyperlinked below as an oil expert.

The movie provides numerous examples of current technology that we can employ to reduce our carbon footprint by 90% if we only had the political will. The point that Thom made was that we cannot wait for the politicians to lead on the issue. We must, as a society, lead and drag the politicians screaming and kicking into action. We must use all of our resources including internet and other organizational avenues to make a difference.

The movie does provide hope that we can move into an era of a green society, that we can transition from the oil era to a new world. I do not think that it is a false hope (yet). The key is making a difference now.


From the legislation thread it seemed that CAFE had been withdrawn anyway, so the veto is good as it takes away additional subsidies for the ethanol boondoggle.

My suggestion is to make it illegal to drive a car or light truck without at least two passengers.

A great shot in the arm for an industry manufacturing 'car dummies' to prop up in the seat next to you. I bet you might see some of these in carpool lanes already.

A great shot in the arm for an industry manufacturing 'car dummies' to prop up in the seat next to you. I bet you might see some of these in carpool lanes already.

Hehehe, it would also mean that, in many cases, you could not go anywhere unless you persuaded someone else to go with you. That would mean you would always be hauling extra weight, using more fuel than if you went alone.

Ron Patterson

We may come to know the Mexican citizens visiting us better. It would certainly open up new employment possibilities !


Or it would encourage everyone to buy a pickup truck. LOL.

Yup. You see the stories in the news fairly regularly. People put mannequins in their passenger seats. Or pregnant women try to claim they should be counted as two people.

In Houston a year or so ago they arrested a guy with a blow up plastic love doll in the HOV lane! He sais he'd had his "lady friend" over 6 months.
Bob Ebersole

All the talk has been about urban electric rail. This may have the most physical impact on the oil problem, but I believe interurban electric rail is more important psychologically.

People are most hesitant to convert to electric vehicles since they won't get 300 miles range. If the regional travel issue can be effectively addressed, they will be more willing to look at the shorter range alternatives.

In regard to Matt's talk, he mentions that our refineries are 85 years old. Valves and parts are replaced, but the core is 85 yrs old, and way beyond their design life.

He is real big on ocean energy and barges.

He also mentions a series by the Chicago Tribune as very good on peak. Any references or comments by those that have read it?

He also mentions a series by the Chicago Tribune as very good on peak. Any references or comments by those that have read it?

It got a ton of coverage in the peak oil community when it first came out. I think you can still read it here.

The journalist was Paul Salopek. The general consensus was that he did a fine job.

Thanks Leanan.

While I was researching and pasting urls, you posted ahead of me. There wasn't any comments when I opened my new window-so slow.

I haven't seen any comments on about Simmon's pushing barge over rail for transport.

I thought it was a little loaded analysis, a comparison of shipping from San Diego to Portland ME. Rail loses mainly due to siding delays in transit, whereas barge is whisked through the Panama Canal. I wonder what delays the canal will produce once trucking is not an option.

Finally, wave energy is intriguing, but I wonder if there really is sufficient scale there to make a difference. I know of several supplier companies, including the earlier drumbeat reference, Ocean Power Delivery, and that Norsk Hydro is pushing it. Also, it doesn't thus far have the NIMBYism of offshore wind. Commercial net fisherman are apprehensive, but I can also see how all the additional offshore structure would improve habitat for many species, and be a boon for hook and line.

BN-SF is double tracking the last 2% of it's line from Los Angles to Chicago and Union Pacific is 2/3rd finished with double tracking from LA to El Paso (UP has three single tracks lines east of El Paso).

This alone will speed rail shipments significantly. I would like to see both lines built out as triple tracks (double tracks when any maintenance is going on, as it always is somewhere on a 1,000 mile line).

OTOH, a 3rd set of locks (significantly larger) will open on the Panama Canal, ending delays, in 2014.

So both energy efficient modes are improving :-)


I imagine the story he referenced is this below, summarized and linked by section on the Energy Bulletin, from July 2006.


It was also a keypost for TOD


Finally, the Chicago Tribune story. Even at over a year old, it's very good.


Simmons suggested during the interview that were it not for the sub-prime meltdown, oil would not be in the 70s but in the 80s.

Were it not for the evil Republicans, oil should have been over $100 last election, and up to $150 the winter after Katrina. Somehow, things just seem to get in the way of these 'predictions'.

Perhaps only a prediction; it sounded more like a simple observation based on something much more direct - like people being forced to sell for liquidity. He dropped it so off-handedly. It was one of the questions I asked following up the last blogger call with API - whether there might be an effect from the sub-prime snowball. Seemed far-fetched at that time: I was wondering if some of the financing for large projects might be tied to those funky financial instruments.

cfm in Gray, ME

Simmons on PO awareness amongst politicians:

I'm very close friends with one of the candidates running for president and I know he knows whats going on.

Anyone know which candidate that is?

Given that he supplies the campaign jet for Romney and advises him on energy, I could guess.

Massachusetts transit supporters I know have a VERY dim view of his energy record. All for cars !


Thanks, wasn't aware of this.

I googled "matt simmons and mitt romnney" and got quite a few hits.

Basically, Simmons is on Romney's TX finance committee, along with a bunch of other folks, including Ross Perot, Jr.

Simmons also lets Romney use the company jet.

I did not find the quote, but I understand that the Simmons and Romney families are old friends.

This does not mean that Simmons endorses everything Romney says or does, but the two do have a friendship, and do talk.

Romney mentioned Simmons as an oil industry insider who told him that refineries in the US were " rust held together by paint" during a CNN thing with wolf B.

Interesting ... but I'm not reading too much into it.

Re: Held together by rust and paint.

I'm losing some respect for Simmons. He's gotten awfully sloppy with his comments. I don't believe for a minute that most of the oil refineries now in operation have equipment from 1927. His comments about ethanol are equally exaggerated. Then he flies around in a company jet preaching about PO and how somebody should do something. He's a friend of TPTB, well connected and with plenty of resources. Walk the walk and not just talk the talk. Al Gore gets criticized for similar behavior.

well if it's in good condition, and it works then why replace it? I think though his comment is talking about the industry as a whole and it's durability.

Thanks Westexas I listened in.

I was particulary interested in the subject that Matt said he is currently researching heavily into, RUST!

Says the existing infrastructure is wasted. OUCH!

Re: All the Canaries Have Stopped Singing

Matt Simmons goes thru his "stump speech" again today. It's a good listen for those that haven't heard him before.

I like his comments about the disconnect between demand projections and the reality of supply. While there may be a major increase in demand by 2030 or 2050, i.e., there are going to be many more people that want to drive, there's little hope that there will be anywhere near the amount of oil needed to satisfy that demand, if the future resembles the past. By that I mean, if our transportation system continues to be based on private automobiles getting 27 mpg and PU/SUV's that do worse. This will be especially difficult for people in the U.S., where many people are still buying those large, gas guzzlers and where gasoline is still available almost everywhere one looks. It will be a big change for the U.S. consumer to cut back to the per capita oil consumption levels already found in Europe or Japan. And that would only be the beginning, as we are now bidding against the rapidly growing economies in China and India, with similar fast growth happening in other countries as well.

All this has been said and written about many times since the OPEC Oil Embargo of 1973. We were warned again after the Iranian Revolution of 1979. Our leaders didn't tell us about the seriousness of the problem then and they aren't really talking about making real changes now. What would it take for Congress to vote for a steep increase in the gasoline tax, say, $2 per gallon? I'm afraid that the political class will be the last to admit that the party is over and we need to get down and dirty doing some real work, instead of playing games with paper money and calling that wealth creation. As Simmons points out, it takes investment and time to produce energy. Once the oil peak becomes obvious, there may not be enough time to build the replacement systems that may keep the lights on and the homes warm in winter, let alone keep the cars and trucks running. I do think he is wrong about CAFE standards, especially as he notes that diesels are already capable of achieving the mpg results in the recent energy bill. I think the standards need to be real and set even higher than that considered in Congress.

What we need is not just a great "Manhattan Project", but an entirely different way of looking at how we (as a nation) live our lives. The things we do every day will all need to change, including what we do to provide our survival needs, that is, what we now call "work". Maybe what is needed is an entirely different sort of government. Worse yet, we may get one when TSHTF, but one of the bad old kind, out of sheer desperation... :-(

E. Swanson

Black Dog says: "Once the oil peak becomes obvious, there may not be enough time to build the replacement systems that may keep the lights on and the homes warm in winter, let alone keep the cars and trucks running."

Make that "...there WILL not be enough time..." This was confirmed by the Hirsch Report two years ago. We should have started 20 years ago if we wanted a relatively painless transition to alternative energy. From the report:

"The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking." In other words, we're toast.

Good introduction to the Hirsch Report at EB:


We're only toast if PO did occur in 2005. If its only 'peak lite', the crystal ball is slightly murkier on the subject...

So what I'm hearing here is that PO is still at least ten years in the future, and we're doing everything we can already to mitigate it? That's good to know.

Party On, Guy!!

I said no such thing and you know it. The only thing I said is that we will be facing serious problems for the next 20 years IF PO really did occur back in 2005, and that it wasn't just 'peak lite' as RR likes to call it. Lets take people out of context more shall we?

Oh dear. PG, it's a little difficult to take you OUT of context when the only context you give me is your very brief posting above.

"We're only toast if PO did occur in 2005." No, sorry, "Peak Lite" or no "Peak Lite" that simply isn't true, , and that's my point. If you understand and accept the conclusions of the Hirsch Report then you also understand that if PO has occurred or occurs in the next ten years and we are still doing little or nothing about it, we are indeed in deep do-do.

It's a small exercise in logic, you need to read between the lines of what you are actually saying in the context of my postings and the Hirsch Report.

Thank you for helping me clarify this ;-)

As Matt Simmons pointed out, conventional crude oil peaked out back in May 2005. If one considers what's called petroleum, i.e., crude + natural gas liquids, there's been a slight increase in supply. But, natural gas also can be expected to peak out, although I have no clue about the timing. Thus, natural gas liquids will also peak out and begin to decline. Given that the world's oil companies are not replacing their oil reserves at anything like the rate at which it's being consumed, there would appear to be little chance that crude oil production will will rise above the peak of 2005. Unless, of course, OPEC, (aka KSA), really does have all that extra capacity and has been holding back to satisfy their respective quotas.

If we are at peak oil, then one would expect to see a shift to natural gas for some of the increase in demand. After all, NG can be used in many of the same situations as oil, for example, running diesel buses or cars with engines designed for gasoline. There's also a lot of NG being used to make electricity. Once NG peaks, what are we going to do to heat all those McMansions that have been built during the recent bubble years? What about all the industrial users where NG is a very valuable component of many activities?

But, hey, party on dude! When time comes, we'll eat your lunch, so to speak. It's guys like you who deserve to have their demand destroyed (literally!).

E. Swanson

Sorry Black Dog, natural gas peaked in the US in about 98 if I'm recalling correctly. Dave Cohen wrote an excellent Key Post abou 9 months ago called "Running with the Red Queen" which you should get out of the oil drum archives and read. Its a truly great piece.
Bob Ebersole

I posted a question on last night's drumbeat about Chinese Coal mining.

There was yet another mine accident, this time Flooding due to heavy rains. 170 plus miners stuck in a mine. They mentioned there were over 700 miners in the mine at the time. What kind of operations put those kind of numbers of miners in a mine?

Are they just using hand tools to mine or something?

In a modern mechanised mine you can easily get 1000 miners underground. The numbers depend upon
the number of longwall faces being worked
the length and complexity of the underground transport systems
the amount of development activity such as opening new seams and/or new faces.
But the frequency of Chinese accidents makes the much maligned (and justly so) old UK "coalowners" look really, really, safety concious. I wonder if Chinese miners have songs like "The Gresford Disaster"?

Since there is a lot of confused discussion in this thread, and generally at The Oil Drum, I will clarify a few issues.

  1. The oil supply is in a plateau since the beginning of 2005.
  2. It is not known if this is the peak of global oil production, but a few years will tell the tale.
  3. It is not likely that OPEC (Saudi Arabia) will be able to put enough production on-stream in the near term to do anything but temporarily change this peak.
  4. non-OPEC production will peak in the 2010-2011 period, this is a dead certainty, and most uncertainty rests with how much non-OPEC production will increase through 2009.
Therefore, we depend on whatever OPEC can do after 2010, which doesn't appear to be much.

Even if OPEC could ramp up production a while longer (and I doubt it), why would they? Whenever oil has been in short supply they've had it good, and whenever oil has been in abundance they've had it rotten. The only times that OPEC has ever ramped up production above and beyond what they really had to was when the KSA was afraid of the big bad Soviets, or the big bad Iranians, or the big bad Iraqis, and felt that they had to do the USA a favor. I suspect that at this point the KSA probably feels that they are paid in full as far as any obligation to the USA is concerned, and that if anything they feel that it is the USA that owes them.

Hello TODers,

Please recall my earlier postings on human-induced mining seismicity and other geo-structure failings causing possible far-reaching effects on NPK fertilizer supplies.

After much googling: I just found an intriguing series of newslinks detailing on why the railroad tracks above the mine is shifting and/or sinking, and also how a whole town may be on the verge of being destroyed from underground mining:

August 7, 2007

Agrium Inc. fell 0.9 per cent Friday on the New York Stock Exchange despite a recent report about ground sinking at Uralkali, Russia's largest potash miner and exporter, that could tighten the potash market. UBS analyst Brian MacArthur, who upgraded Agrium to "buy" from "neutral," with a new price target of $48.50 (U.S.), up from $45, suggests that the ground shifting affects a railway line that Uralkali's competitor, Silvinit, relies upon to ship potash. "Our understanding is that while the potash shipments on this rail line are still moving, we believe they have slowed," he writes. "Furthermore, we believe this issue of unreliability could ultimately impact potash pricing, if supply is tightened."
Could the Uralkali area be on the verge of a major seismic event? I have no expert idea, but recall that they closed another mine 13 years earlier than planned due to flooding:

Uralkali Will Offset Mine Closure - Deutsche October 30, 2006

Uralkali's (URKA.RS) closure at the weekend of its oldest mine due to flooding is disappointing but not disastrous, say Deutsche Bank analysts Elena Sakhnova and Alexandra Melnikova, who stick with their hold recommendation and 12-month target price of $1.70. The mine has been closed 13 years ahead of the estimated end-of-useful-life, but Deutsche says increased output at the company's fourth mine will compensate up to 60% of the lost output.

Of course this next link seems to indicate that it will be more disasterous than merely disappointing:

At 07:33 GMT+5, July 29, deep-seated rock collapsed in the crater. The process was accompanied by a loud clap, a short vibration of the surface, and an emission of the mine air and rock fragments into the air. Simultaneously, an emission of hydrogen sulfide occurred in the crater.

Scientists had forecasted a probable subsidence in the area of brine inflow into the mineshaft since the first days of the accident at the BKRU-1 mine. In accordance with their recommendations, access of people to the danger zone was terminated, and facilities were closed down and partly dismantled. As a gas pipeline and a section of the railroad are located in the area of a probable subsidence, it was decided to relocate the gas pipeline and to build a bypass railroad spur.

Later, based on the monitoring results and the study of data about mining operations related to the BKRU-1 mine take, the scientists identified another hazardous zone in the area of carnallite layers that were developed in the late 1940s and early 1950s without stowing operations. In the scientists' opinion, the flooding of this area may lead to the partial destruction of the buildings due to an irregular subsidence. According to a Rostekhnadzor conclusion, this may happen before December 1, 2007.

"Even an insignificant vibration in the subsidence may lead to destructing the structures of houses, especially those located on the border of the carnallite zone. It is estimated that, according to the worst-case scenario, the carnallite zone will be flooded by the beginning of December."

On the morning of July 28, Governor of the Perm Territory Oleg Chirkunov held a planned meeting with the residents of the houses that are considered to be in an emergency state. On his way back to Perm, he received information about the subsidence and returned to Berezniki. It was necessary to prevent any panic. The Governor decided to make a TV statement to town residents.

The biggest risk related to the subsidence concerns uninterrupted cargo transportation by rail. At 18:15, July 29, the first train passed along the emergency road. The main task for the next stage is to build a bypass railroad. The task for next week is to start building houses according to our plans."

So I hope this help explains why stocks in North American Potash companies have been rising so much, and why the Russian/Belarus pricing consortium have been raising their rates so fast. Priced guano lately?

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

Hello TODers,

Just as many TODers have already mentioned on mining FFs, production costs are rising faster than ever on superdeep underground potash mining:

[PDF WARNING] http://bdopen.com/files/articles/48442/EDIT-Silvinit_upgrade_160507%20_f...
In 2006, Silvinit increased its revenues by 17% to US$677m, but reduced margin rates. The company’s 2005 EBITDA margin was 47.5%, but fell slightly to 42.4% in 2006. The net margin faced the same situation; a fall from 31.9% in 2005 to 26.3% in 2006. We regard the disclosed results as
positive, as we had expected less dynamic revenue growth (to US$638m) and a more significant loss in profitability.
The margin decrease was caused by faster growth of cost of goods manufactured, which increased by almost 30% as a result of a gradual depletion of reserves at the Verkhnekamsk potash-magnesium salts field...
Depletion is unstoppable, and human-induced seismicity is a cascading blowback event as we extract the last we can using high-energy methods. Does anyone disagree that FFs and NPK fertilizers are inextricably linked?

EDIT: one final link to a table illustrating why potash availability may be more more critical to the required farming balance of NPK than any other element:


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