Drumbeat: January 30, 2010
Posted by Leanan on January 30, 2010 - 10:38am
China Leading Race to Make Clean Energy
TIANJIN, China — China vaulted past competitors in Denmark, Germany, Spain and the United States last year to become the world’s largest maker of wind turbines, and is poised to expand even further this year.China has also leapfrogged the West in the last two years to emerge as the world’s largest manufacturer of solar panels. And the country is pushing equally hard to build nuclear reactors and the most efficient types of coal power plants.
These efforts to dominate the global manufacture of renewable energy technologies raise the prospect that the West may someday trade its dependence on oil from the Mideast for a reliance on solar panels, wind turbines and other gear manufactured in China.
“Most of the energy equipment will carry a brass plate, ‘Made in China,’ ” said K. K. Chan, the chief executive of Nature Elements Capital, a private equity fund in Beijing that focuses on renewable energy.
U.S. speeding up arms sales, defenses with Gulf allies
DUBAI, UNITED ARAB EMIRATES -- The Obama administration is quietly working with Saudi Arabia and other Persian Gulf allies to speed up arms sales and rapidly upgrade defenses for oil terminals and other key infrastructure in a bid to thwart future military attacks by Iran, according to former and current U.S. and Middle Eastern government officials.The initiatives, including a U.S.-backed plan to triple the size of a 10,000-man protection force in Saudi Arabia, are part of a broader push that includes unprecedented coordination of air defenses and expanded joint exercises between the U.S. and Arab militaries, the officials said. All appear to be aimed at increasing pressure on Tehran.
Kazakhs protest government's burgeoning ties with Beijing
ALMATY: Kazakh protesters scuffled with police yesterday at a rally against their government's burgeoning ties with neighboring China. Many in Kazakhstan, a vast but thinly populated nation, are suspicious of China's growing influence in resource-rich Central Asia and accuse the government of selling out oil riches to their giant, energy-hungry neighbor. President Nursultan Nazarbayev said last month China had proposed renting a million hectares of Kazakh land to grow soya and other crops. The government later denied any plans to lease land to China.
Political Uncertainty Grips a Russian Republic
Dagestan, one of the most heavily subsidized of Russia’s regions, should be able to support itself. It has oil and gas reserves, like neighboring Azerbaijan, and once lucrative vineyards and fisheries. The sandy coastline itself, stretching 250 miles along the Caspian Sea, should be a moneymaker in a beach-starved colossus like Russia.But the beaches around Makhachkala (pronounced ma-HACH-ka-la), a city of 466,000, offer a primer in what has gone wrong. Tycoons have chopped up much of the coast for private mansions, and local residents complain that the public beaches that remain are too dirty and ill kept to enjoy. As for tourists, Makhachkala’s mayor, Said D. Amirov — who now uses a wheelchair as a result of an assassination attempt — put it this way: “You can’t develop tourism when you have a murder every day.”
Although the issue of peak oil has gained attention over the last several years (due mainly to oil prices skyrocketing to $147 per barrel in 2008), it's simply amazing that most opponents have no idea what "peak oil" means.
Fighting Starvation, Haitians Share Portions
PORT-AU-PRINCE, Haiti — Maxi Extralien, a twig-thin 10-year-old in a SpongeBob pajama top, ate only a single bean from the heavy plate of food he received recently from a Haitian civic group. He had to make it last.“My mother has 12 kids but a lot of them died,” he said, covering his meal so he could carry it to his family. “There are six of us now and my mom.”
For Maxi and countless others here in Haiti’s pulverized capital, new rules of hunger etiquette are emerging. Stealing food, it is widely known, might get you killed. Children are most likely to return with something to eat, but no matter what is found, or how hungry the forager, everything must be shared.
...“The whole food supply chain has been trashed by the earthquake,” said David Orr, a spokesman for the World Food Program. “The port, the roads, the trucks, the whole commercial life of the country has been disrupted.”
It is not, after all, just homes that fell when the earth shook on Jan. 12. Supermarkets have collapsed to rubble. Butchers and bakers are dead.
The Fateful Geological Prize Called Haiti
The vast oil reserves of the Persian Gulf and of the region from the Red Sea into the Gulf of Aden are at a similar convergence zone of large tectonic plates, as are such oil-rich zones as Indonesia and the waters off the coast of California. In short, in terms of the physics of the earth, precisely such intersections of tectonic masses as run directly beneath Haiti have a remarkable tendency to be the sites of vast treasures of minerals, as well as oil and gas, throughout the world.Notably, in 2005, a year after the Bush-Cheney Administration de facto deposed the democratically elected President of Haiti, Jean-Baptiste Aristide, a team of geologists from the Institute for Geophysics at the University of Texas began an ambitious and thorough two-phase mapping of all geological data of the Caribbean Basins. The project is due to be completed in 2011. Directed by Dr. Paul Mann, it is called “Caribbean Basins, Tectonics and Hydrocarbons.” It is all about determining as precisely as possible the relation between tectonic plates in the Caribbean and the potential for hydrocarbons—oil and gas.
It is impossible to name a specific timeline for a possible "War for the Antarctic." But conjecture is possible based on the following factors - for example, the appearance of technology allowing rapid and cost effective supply of fresh water from Antarctic glaciers to arid and tropical regions; a new increase in oil prices and growing demand for crude, which will make oil extraction on the Antarctic shelf economically viable or an increase in demand for food because of the growing global population, which would require fishing in the south seas, etc.
Obama Acts to Ease Way to Construct Reactors
When President Obama said in his State of the Union address on Wednesday that the country should build “a new generation of safe, clean nuclear power plants,” it was one of the few times he got bipartisan applause.
China Insists That Its Steps on Climate Be Voluntary
BEIJING — As a Sunday target date approaches for countries to submit to the United Nations their plans for fighting climate change, China is banding together with other major developing nations to stress that only the wealthier countries need to make internationally binding commitments.
Carbon Market Could Grow 33% This Year
The global carbon market is expected to total $170 billion this year, a 33 percent jump from 2009, driven mostly by higher prices in Europe and a growth in the nascent carbon market in the United States, according to a new report from Point Carbon, a market analysis firm.
Chris Martenson: Big Ideas at the Commonwealth Club
Five years ago the audiences were all ‘of an age’ and now they include many more younger people and represent a much broader cross section of society, beliefs, professions and income levels.My impression is that the tide is shifting, powerfully, and yesterday’s response proved to me that ideas matter, that people care, and that getting our collective act together is a rapidly ascending priority for a growing group of people. Whoever says that there's no interest anymore in big ideas is flat-out wrong.
Analysis: Major Offshore Project Start-Ups to Watch in 2010
As we look at the year ahead, OPEC is predicting a world crude demand of at least 85.1 MMb/d. Specifically, the cartel's forecast calls for world oil demand to grow modestly (by about 0.8 MMb/d) this year, a view they have maintained since late-2009. Though there is no shortage of oil supply, the following projects, due to come onstream in 2010, can only help in supplying this demand.
Mexico shuts Gulf oil port due to bad weather
Mexico, a major oil supplier to the United States, shut the Dos Bocas oil export terminal in the Gulf, the communications and transport ministry said in a statement.
Alaska Pipeline Project Files Open Season Plan
The Alaska Pipeline Project has filed its plan with the U.S. Federal Energy Regulatory Commission (FERC) to obtain approval to conduct the first natural gas pipeline open season to develop Alaska's vast natural gas resources. The project is a joint effort between TransCanada Corporation and Exxon Mobil Corporation to develop a natural gas pipeline under the Alaska Gasline Inducement Act (AGIA).
South Korean business leaders are proud that they have built a powerful, energy-intensive economy in a land with almost no natural resources. If Ulsan were its own country, its GDP per capita would be among the world’s highest, and it has created that wealth in large part by efficiently converting imported energy from the Middle East into products sold around the world.But a steady rise in oil and gas prices has put increasing pressure on the country’s old economic model.
Is aid without climate adaptation a waste of time?
Aid agencies are well resourced and quick to act, but not enough of them appear to be using their power to tackle the long term problems posed by climate change.
Straw Homes That Would Have Foiled the Wolf
At Quail Springs, days are spent perfecting greywater systems, creating food forests and building bio-swales to keep the limited rainwater from eroding the topsoil. But what's really capturing attention are the buildings constructed with natural products like straw bale, adobe and bamboo.But don't expect to see this eco-village-in-the-making take final form in your lifetime — or your children's or your grandchildren's — and certainly not in the lifetime of the farm's founders, husband-and-wife team Warren Brush and Cynthia Harvan.
Brush says the undertaking will take 200 years.
5 Unique Ways to Go Green if You're Living in a Dorm
College is often termed the best years of your life. Now, recent trends suggest that it is also becoming pretty green. A growing number of colleges and universities are seeking ways to reduce their greenhouse gas emissions, many with energy-efficient facilities and construction projects. A wind turbine at St. Olaf College in Minnesota, for example, provides 33 percent of campus electricity and saves more than $250,000 annually in utility costs. Richard Stockton College in New Jersey is heated and cooled using one of the country's largest closed-loop geothermal systems, and students living in a new green-themed dorm at Dartmouth College use, on average, about 60 percent less energy than other students on campus. Plans for the dorm, named the Sustainable Living Center, call for it to be a waste-free, energy-neutral student residence.
Welcome To The Soft Apocalypse
By now, the apocalypse story – which goes back at least as far as the ancient Hebrews – has fractured into numerous sub-genres. Our favorite, these days, is the soft apocalypse, where the end has come but life goes on.The Road) and the "happy apocalypse" (Noah's Arc, Asimov's Foundation books, or the '70s novel Ecotopia), where civilization falls but is replaced by something better. Sometimes, of course, it's just a matter of tone: Road Warrior shows us humanity surviving after devastation, but it's hard to call anything there "soft."
The Perfect Near-Future Novel To Get You Through The Recession
Need a book to get you through another year of unemployment, glacier melts or maybe even another oil crisis? World Made By Hand could do the trick.
Energy prices fall so far in 2010
NEW YORK (AP) -- For the past several months, oil prices have soared on the expectation that China would soon lead a new race for natural resources.But government data released so far this year has told a different story, and oil has tumbled nearly $10 a barrel in the first month of 2010.
Americans are burning less gasoline than they did a year ago, according to a report this week from the Energy Information Administration. The EIA says the country's appetite for petroleum products has dropped every week this month. And while China should expand petroleum consumption this year, a decision to rein in risky bank loans and cool down its economy may curb China's energy appetite.
"What's been driving oil prices is the promise of Chinese economic growth," said Phil Flynn, an analyst with PFGBest. "But its demand numbers are very suspect right now."
Crude Oil Falls to Five-Week Low as Dollar Rises Against Euro
(Bloomberg) -- Crude oil fell to a five-week low as the dollar strengthened against the euro, making commodities less attractive as an alternative investment.
Follow the Money (video)
Standing at the pump, watching the numbers tick away, do you ever wonder where the money goes? You're not alone: People on the other end of the pipeline are wondering too. While we feel the pinch in our pockets, citizens of oil-producing countries are often not seeing the profits.
Lester R. Brown: Mounting Stresses, Failing States
Among the top 20 countries on the failing state list, all but a few are losing the race between food production and population growth. Close to half of these states depend on a food lifeline from the World Food Programme. Food shortages can put intense pressures on governments. In many countries the social order began showing signs of stress in 2007 in the face of soaring food prices and spreading hunger. Food riots and unrest continued in 2008 in dozens of countries, from tortilla riots in Mexico to breadline fights in Egypt. In Haiti, soaring food prices helped bring down the government.Another characteristic of failing states is a deterioration of infrastructure—roads and power, water, and sewage systems. Care for natural systems is also neglected as people struggle to survive. Forests, grasslands, and croplands deteriorate, generating a downward economic spiral. A drying up of foreign investment and a resultant rise in unemployment are also part of the decline syndrome.
Oil Shortage 'Claim' Tip of the Iceburg
Few thought it was possible, but a surefire conspiracy seems to be brewing. Energy, the heartbeat of the world, is the cusp in the coming tide. The theory of Peak Oil is running rampant. Over 75% of the human population believe that he earth will soon run out of oil.The US is producing less than 40% of the domestic crude it needs. It's regulatory limitations have increased so much that a new oil refinery hasn't been built in over 30 years. It's environmentalregulations have 'built' a wall around obtaining oil from the Outer Continental Shelf (OCS), ANWR, and oil shales. That can mean only one thing.
The current administration seems to want a global governance. That governance would be controlled by one person--a ruler of sorts over everything. The UN would control energy, economies, and lives. But Obama has the power to put America first again.
Natural gas supplies could be augmented with methane hydrate
WASHINGTON – Naturally occurring methane hydrate may represent an enormous source of methane, the main component of natural gas, and could ultimately augment conventional natural gas supplies, says a new congressionally mandated report from the National Research Council. Although a number of challenges require attention before commercial production can be realized, no technical challenges have been identified as insurmountable. Moreover, the U.S. Department of Energy's Methane Hydrate Research and Development Program has made considerable progress in the past five years toward understanding and developing methane hydrate as a possible energy resource."DOE's program and programs in the national and international research community provide increasing confidence from a technical standpoint that some commercial production of methane from methane hydrate could be achieved in the United States before 2025," said Charles Paull, chair of the committee that wrote the report, and senior scientist, Monterey Bay Aquarium Research Institute in California. "With global energy demand projected to increase, unconventional resources such as methane hydrate become important to consider as part of the future U.S. energy portfolio and could help provide more energy security for the United States."
Exxon, TransCanada Say Alaska Gas Pipeline Cost Soars
(Bloomberg) -- Exxon Mobil Corp. and TransCanada Corp. said a proposed pipeline to carry Alaskan natural gas to U.S. markets will cost 23 percent to 58 percent more than originally expected.
Is Iraq's oil strategy too ambitious?
BAGHDAD (UPI) -- The chief executives of two of the world's oil giants have been waxing lyrical about helping Iraq quadruple its oil production over the next decade, but questions linger about whether it can be done.Some energy industry experts believe that given the plethora of problems that the Iraqi government of Prime Minister Nouri al-Maliki is having to deal with, Baghdad is being way too ambitious.
Oil India May Buy Fields in Africa, Latin America, Australia
(Bloomberg) -- Oil India Ltd., the nation’s second- biggest state-run explorer, is seeking to buy oilfields in Africa, Latin America and Australia to cut imports and meet energy demand in India, Asia’s third-biggest consumer.
BP Interested in Brazil Assets, China Projects
(Bloomberg) -- BP Plc is interested in acquiring assets in Brazil and is working with China Petrochemical Corp. to expand in Asia, Chief Executive Officer Tony Hayward said today.“If we can find the right opportunity, we’ll enter Brazil,” Hayward said in an interview at the World Economic Forum in Davos, Switzerland today. “We’ve signed an agreement with Sinopec,” and “we continue to see new opportunities, like shale and other things” in China.
Brazil to renew energy contracts by decree-report
SAO PAULO (Reuters) - Brazil's Mines and Energy minister on Friday denied that a draft provisional measure had been prepared that would enable concessions for electricity firms to be renewed by decree ahead of their expiry in 2015.Friday's Folha de Sao Paulo newspaper said such a measure was afoot to reduce regulatory uncertainty that had damped investments and mergers in the sector, to help utilities firms raise funds from banks by showing concrete future plans.
Nigerian Militants Cancel Cease-Fire With Government, AP Says
(Bloomberg) -- Nigeria’s main militant group has ended a cease-fire with the government and pledged to renew attacks on the nation’s oil industry, the Associated Press reported, citing a statement from the group.
SNAP ANALYSIS - Nigerian oil militants end ceasefire
MEND was significantly weakened by last year's amnesty programme, with several of its top field commanders handing over their weapons in return for clemency. It is unclear who is in charge and what operational capacity the group has left.But oil infrastructure in the delta, a network of thousands of shallow creeks opening into the Gulf of Guinea, is extremely exposed with thousands of kilometres (miles) of pipeline passing through remote and thickly-forested terrain.
"To damage a pipeline just takes one youth who is able to swim and carry a beer bottle that is filled with sand and petrol," Emmanuel Uduaghan, governor of Delta state, one of the three main states in the region, said last month.
Arch Coal Plunges After Profit Falls Below Estimates
(Bloomberg) -- Arch Coal Inc., the second-largest U.S. coal producer, plunged the most in 13 months after it said fourth-quarter profit missed analysts’ estimates on lower shipments amid the worst recession since the 1930s.
Woodside Construction Workers Return to Australian LNG Project
(Bloomberg) -- Woodside Petroleum Ltd., Australia’s second-largest oil and gas producer, said construction workers who went on strike at its Pluto liquefied natural gas project in Western Australia returned to their jobs today.
Gold Versus Co2 Bancor, Why Are Gold Bugs Scared?
As we noted above, the US dollar is already Bancor, in the fiat money sense that its creation and circulation has no need at all to relate to fundamentals. Not for nothing, 'Time' magazine in 1999 named Keynes as one of the 20th century's most influential persons, writing: "His radical idea that governments should spend money they don't have may have saved capitalism".With a CO2 Bancor, capitalism can create virtual money and survive the final energy crisis, when the after-peak oil fall in global energy supply begins to be really serious, well before 2020. Other natural resource stress points and strangleholds can be added. These affect everything from iron ore and coal transort and supply, to water and soil resources. All need massive remedial investment spending to avert serious and permanent shortage, making it very desirable to have a new world reserve money, with a tendency to fewer zero's after the spending need estimates.
Kentucky studies 42 locations with best potential for nuclear plants
State officials are scouting potential nuclear power plant sites around Kentucky as part of a broader effort to expand the state's electricity supply beyond traditional coal-fired generators.
Sydney desalination plant splits opinion
One of the world's biggest desalination plants is about to open in Australia's most populous - and thirstiest - city, Sydney.The $1.7bn (£1.04bn) scheme has been driven by concerns about climate change and of erratic rainfall patterns in a fast-growing metropolitan area attracting 50,000 new residents each year.
Climate chief was told of false glacier claims before Copenhagen
The chairman of the leading climate change watchdog was informed that claims about melting Himalayan glaciers were false before the Copenhagen summit, The Times has learnt.Rajendra Pachauri was told that the Intergovernmental Panel on Climate Change assessment that the glaciers would disappear by 2035 was wrong, but he waited two months to correct it. He failed to act despite learning that the claim had been refuted by several leading glaciologists.
Obama Orders Government To Slash GHG Emissions 28%
President Obama has ordered the government, the largest consumer of energy in the U.S., to reduce its greenhouse gas emissions 28 percent by 2020....The federal government, which occupies nearly 500,000 buildings, operates more than 600,000 vehicles, employs more than 1.8 million civilians, and purchases more than $500 billion per year in goods and services, spent more than $24.5 billion on electricity and fuel in 2008 alone. Achieving the federal GHG pollution reduction target will reduce federal energy use by the equivalent of 646 trillion BTUs, equal to 205 million barrels of oil, and taking 17 million cars off the road for one year. This is also equivalent to a cumulative total of $8 to $11 billion in avoided energy costs through 2020, according to the White House.
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Would an oilman, WT, Rockman or whomever, please explain how this is possible.
From the link up top: Is Iraq's oil strategy too ambitious?
However from an article published just last October, I found this.
Iraq: Working Rumaila
Last October they were going to work flat out to boost production in Rumaila by 10 percent. Now, just three months later, they hope to boost production by 300 percent. What am I missing here?
Ron P.
I guess I would ask BP why they can't bring North Sea crude production back up to the 1999 peak rate of about 6 mbpd, or to a greater rate. And what about Prudhoe Bay?
In any case, I would invite readers to once again study this 2004 case history of a major oil company and a Middle Eastern oil field (Shell & the Yibal Field), which highlights the disconnect between what senior executives say and what is happening on a field level:
http://www.nytimes.com/2004/04/08/business/oman-s-oil-yield-long-in-decl...
Reading further in the "Working Rumaila" link, BP hopes to start getting money back very soon and to invest part of that return to eventually get production up to 3 mb/d.
Ahhhh... finally the fog clears. They will start getting money back immediately then invest only part of that return in an attempt to boost production. But if production does not increase, if the water cut continues to increase and if the return they get does not equal the money invested, they take their football and go home.
That is, they get a huge chunk of money for even minor increases in production and if no further increase is forthcoming, they simply pocket their profit so far and pull out. Now why didn't I figure that out sooner?
Ron P.
Stuart Staniford had a piece from Tariq Shafiq on Iraqi Oil Reserves, highlighting the claims of promise in these fields, as well as others untapped as of yet.
Iraq certainly has lots of potential, and there are lots of stories about their announced plans to achieve almost a five fold increase in production in 10 years or less. While I think that they can increase their production, I am in the skeptical camp regarding a multifold increase in production, and especially in regard to net oil exports, for two key reasons.
First, I can’t find any case history of a mature producing region showing this kind of production increase. They closest analogue I can think of is post-Soviet Russia, where they achieved about a 65% increase in production over their post-Soviet low, to a rate below their 1980’s peak production rate. Note that Iraq would have to increase their production by about 50%, just to match their 1979 production rate.
Second, oil consumption in Iraq has been steadily increasing since 2003, and for Iraq just to maintain their 2009 net export rate (which preliminary EIA data show to be down slightly from 2008), they would have to increase their production at about 2.2%year.
So, the bottom line for me is that in my opinion the most realistic positive outlook for Iraq, given the rapid increase in consumption plus numerous political and logistical challenges, is probably a slow rate of increase in net oil exports, and many factors could result in flat to declining net oil exports.
Iraq did not have much invested in horizontal MRC wells. Nor did they have advanced 4-D modeling to see what was happening below the surface.
A few wells taking on water is not the end of oil as we know it. The geometry of a field is such that the wells on the down-dip limbs of an anticline might water out long before the field is depleted.
The assumption that underlies all these Iraq articles is that a large amount of new oil is going to be dumped onto the market causing prices to plummet. After all, this is what the English did with their North Sea find, the US with Prudhoe Bay ... ditto Mexico and others.
Happy Days will be here again, shortly!
Times have changed. The old- fashioned Rockefeller approach to oil marketing is rendered kaput by peak oil. None of the arguments made by the Iraqis and others promoting Iraqi oil make sense outside an understanding of PO.
The Iraqis understand it, clearly not the Americans. The Iraqis will NEVER dump their oil on any markets. Like all good capitalists, they like high priced oil. They can meter some of it out in various markets and push prices into a trading range. If the troubles of the world force prices higher ... that's okay, too. The only thing the Middle East producers fear is a strong US energy policy that features something of the order of a 50% decrease in petroleum consumption.
Who knows, it might just be contagious. Imagine Great Britain conserving 50% of its energy? France? China?
Iraq is positioning itself to be the new swing producer. They probably suspect the Saudi reserves are overstated and they can calculate that when their new production is online, Saudi production will have tapered off to zilch. Geology may have given the mullahs who were not so long ago blowing each other up with car bombs the gift that keeps on giving; trillions of American dollars! Because of the dependency of the US on Middle Eastern oil and the monopoly power of the current swing producer - Saudi Arabia - we cannot even devalue our currency! We are truly prisoners of our own (stupid) device!
Somewhere out there old John D. is laughing. Standard Oil of Ohio made a reputation for underhanded dealings and ruthlessness. The Saudis ... and now, the Iraqis ... have learned well.
Ron – Fortunately the lack of details allow me to speculate to my hearts content. First, I’ll assume the potential increase is valid. Two factors would contribute to low current production rates. Lack of processing capability, though seemingly a simple problem to fix, can be very expensive to expand. If water cut is increasing rapidly it becomes even more difficult to adjust. If the expansion doesn’t increase beyond current needs the increasing water volumes quickly overwhelm the system. Thus the net oil delivery decreases.
Secondly, even if the operator expands processing significantly they are still stuck with the deliverability of the existing wells. Drilling additional infield wells will allow greater gross oil/water volumes but this also requires additional expansion of processing. Drilling hz infield wells might lower the overall water cut but such wells will also deliver an increased amount of water to be processed. And such wells aren’t cheap. A third potential restraint might be an inefficient water aquifer. Not all water drives are created equal. If the oil is sitting on top of an extensive aquifer with good flow characteristics then new wells could quickly up gross produced volumes. But if the water drive isn’t “strong” the aquifer can’t replace the produced water quick enough. The standard solution is to drill down dip water injectors to supplement the weak water influx. A side benefit is this is also a convenient way to get rid of produced water. The downside is, of course, the capex to drill these injectors as well as the cost to pump the water down.
The potential increase in net oil rate might be easily modeled and thus fairly credible. If it looks that good then it might just be as simple as supplying sufficient capex. The plan to start recovering some cash flow to cover future capex for additional expansion would also be easy to model. Just break the expansion up into discrete phases.
But remember: this tale starts with the assumption that the potential increase number is valid.
6 more bank failures Friday night: 2010 total = 15
http://www.fdic.gov/bank/individual/failed/banklist.html
and an article with more details on how they were handled:
http://www.rttnews.com/ArticleView.aspx?Id=1195524
The article above says that the FDIC insures deposits at the nation's 8,195 banks and savings associations.
Since the beginning of 2009 there have been 155 bank closures. That's pushing 2%
Pretty scary if the last half year really has just been a bear market rally...
That may well be the case, especially if there is a parallel between what happened during the Depression and what is happening now. Just before the Stock Market recently started falling from 10,700+ on the Dow to just over 10k now, I read that the bear market rally increase we had just experienced, was at the same retracement level after the initial stock market plunge in 29.
History doesn't necessarily repeat, but at that point I thought, Ok, it's either going to continue to rise from here, if it is indeed a new bull market, or it will start to drop - and since then it has been dropping. Now that doesn't mean it will continue to drop, but with continued foreclosures, bank closings, unemployment remaining at the same high level, huge state deficits an no new stimulus money to pay for those debts, it would seem we are stuck in a funk.
I personally think it's the price of oil. When its cheap, like 20-30 dollars a barrel, like it was in the 90's the economy moves fast, but when it is close to 6% of GDP (80 a barrel) it slows down. So while the economy moves slowly, i.e. money turns over slowly, the expectation of a complete recovery with a bull market are at best wishful thinking.
I take issue with the media coverage which seems to have a green shoots mentality, rather than a big picture view. Just saying things are getting better doesn't make it so. Cherry picking stats doesn't explain the ball of wax.
Maybe the comparison to 1929 ain't spot on in terms of oil/ coal shortage if they didn't have an oil or similar shortage or price spike back then. The financial system was probably more unbalanced back then anyway.
Well they had bank failure where depositors lost all of their money happening. This would mimic to a degree high oil prices.
The problem in general is when you have something sucking cold hard cash out of the system then current debt is not sustainable much less taking on new debt.
The factor causing this cash drain can be different with essentially the same economic effect.
In regards to the article, energy prices may fall in 2010, there are some gaping holes in some of the comments made.
Perhaps one idea being thrown around a lot in the media lately is that the decline of the growth rate in China's economy will result in a decline in the growth of oil usage. If they fall from say 10% economic growth to about 8%, there is no reason to believe that the overall oil usuage wouldn't continue growing in 2010 - albeit at a slower pace. Granted they are probably acheiving some energy efficiencies so that the rate of oil usage growth is slightly less than overall economic growth. However I'd like to see what happens when their economy grows large enough so that their increase in coal usage can not keep up with economic growth and then they will turn to the quickest fix available (oil).
Also, not surprisingly, Michael Lynch, of Strategic Energy & Economic Research, appears to buy in to the slower growth rate/lesser oil demand theory - even as applied to the US. Granted the US economy is on trend to use even less oil in 2010 than in 2009 if the economy doesn't recover - and it may not. However his price predictions seem to ignore growing demand in the rest of the world, and also the fact that oil imports into the US are falling considerably faster than demand is declining.
Charles, a couple of points. We are in a worldwide recession, not just a US recession. Even if oil consumption in China does continue to rise that will not likely offset the decline in the rest of the world. I am saying that your statement: "his price predictions seem to ignore growing demand in the rest of the world," doesn't make sense. What growing demand? OECD demand is still about 2.5 million barrels per day below 2008 levels.
" and also the fact that oil imports into the US are falling considerably faster than demand is declining." I just don't see that either. While stocks have fallen from record highs back in May and June of 2009 they currently sit at the high end of their range for January. And stocks of gasoline and distillates are way above their average for January. See This Week in Petroleum.
What a lot of people on this list seems not to understand is that the economy deeply affects demand. If the economy starts growing like gangbusters then demand, along with price, will go up. But failing that then demand will stay low. And if the recession gets worse, and I believe it will, then demand will fall even further.
The one wild card is OPEC. If demand falls further then OPEC may cut production further, keeping prices in the $70 to $80 range. But the current price of oil, very high by historical standards, is one thing keeping the economy from recovering. Higher prices will only deepen the recession. And consequently higher prices will only deepen the recession.
The health of the economy is tied inversely to the price of energy. We did not realize just how close that relationship was until 2008. I find it shocking that some people still tend to ignore that obvious inverse relationship. Many people still insist that tighter supply will automatically mean triple digit oil prices, ignoring altogether the effect very high oil prices has on the economy.
Ron P.
Let's get the basic facts about the article straight, which is about the EIA forecast. The EIA is predicting an increase over 1 mbpd in worldwide demand in 2010, which I generally agree with. Please note I said nothing about inventory levels, and frankly, whether inventory levels are high or low demand can exceed supply until we hit MOLs (minimum operating levels). In fact the higher the inventory, a greater amount of excess demand over supply can be hidden for some time. I did not mention 2008 demand levels, nor predict an increase in US demand in 2010 - just talking about world growth in 2010.
So far in 2010, prices have fallen, so if anything, the recent respite in prices may help the economy a little.
However it is very likely that once excess inventories around the world are 'burned off', the true state of the supply/demand sitaution will come into sharp focus - and with that much higher prices and a worse economy. It is quite alarming to think that net world exports have have already begun an extended and intractable fall of 6% or so a year, as westexas states.
I don't. The EIA has been predicting over 1 mb/d of increased consumption for years. And up until 2005 they were generally correct. But beginning in 2006 their predictions have been off by a country mile. They were wrong because increasing oil prices, from 2005 on, knocked down consumption. Now they are predicting an increase in consumption of 1.08 mb/d in 2010 and an even bigger increase of 1.47 mb/d in 2011. International Crude Oil and Liquid Fuels Supply, Consumption, And this in the teeth of the worst recession since the Great Depression and historically record high oil prices. It just ain't gonna happen, in my opinion anyway.
I have no argument with you, WT, or anyone else when it comes to world oil exports or world oil supply of any kind. My point is that this will not necessarily result in triple digit energy prices. In fact I believe any short term spike in oil prices above $80 a barrel will be knocked back down, after only a couple of months or so, back down to below $80 a barrel and perhaps even lower.
So I think those who are predicting lower oil prices are probably far closer to the truth than those predicting higher oil prices. The economy just cannot support very high oil prices for very long.
My point: It simply doesn't matter what happens to oil inventories, or oil production, or oil exports, the economy cannot and will not support oil prices any higher than $80 a barrel for more than a couple of months. (Perhaps a while longer but you get my point.) The economy is often slow to respond. This allows oil prices to temporarily get out of whack. But sooner or later the economy knocks them back down. It happened in 2008 and it will happen again if ever they get even close to that figure again.
Ron P.
China may grow auto sales at single digit rates this year. Brazil adding jobs and increasing auto purchases. Indian economy growing quickly. Russian auto sales expected to be flat this year. United States auto sales up in late 2009. French auto sales soared in Q4 2009 up nearly 50%. EU auto consumption surpassed that of China.
Japanese unemployment rate 5.1 percent and falling.
Michigan unemployment rate 14.6 percent and rising.
Nevada unemployment rate 13 percent
California unemployment rate 12.4 percent and flat.
Washington D.C. unemployment rate 12.1 percent.
What worldwide recession?
Rainsong, are you suggesting that there was no worldwide recession? I know some countries are appearing to be exiting the recession, but not yet. There is a still a great danger that Japan as well as the rest of the world will enter a double dip recession. And since oil prices are not likely to get much lower, I expect that to happen.
Jeff Rubin asks. in this video: Why was the recession twice as deep in Japan as in the US? And why was the recession in germany 50 percent deeper than in the US? And why did Germany and Japan go into recession before even Cleveland went into recession?
The worldwide recession still rages. As I said some nations show signs of recovery. China has doled out a massive stimulus package that has spread money everywhere. But will this stimulate their export trade? Not likely since we are still importing far less from them than in 2008.
What worldwide recession? The one that has been raging for about two years, and is likely to get much deeper, signs of recovery in Japan and half a dozen other countries notwithstanding.
Ron P.
I agree that it has been worldwide. Just because some places are doing less poorly than others doesn't mean they haven't slipped backwards. Even if India and China have single digit growth rates, compared to the near of the last decade that is a huge deceleration. I do disagree on the prospects, I suspect we will have more economies recovering than getting worse. I would be surprised if a few places don't see a double dip, but overall I suspect world GDP has bottomed.
Enemy, I understand that we disagree. But you do not understand why we disagree. You think there will be a recovery, that the decline in world GDP has bottomed out. That is not possible because the decline in oil production has not bottomed out. Growth, worldwide, in GDP is over. Sure there will be short time ups and downs. But the general trend will be down... forever. Peak oil means... eventually... peak everything else. Including peak population though there will be a delay between peaks of almost everything after peak oil. Peak population may be delayed, a decade or two, after peak oil. But one will follow the other just as sure as sunset always follows, by about half a day, sunrise.
Ron P.
On Menu in Japan - Beef Bowl With Side of Deflation
There are too many of these types of restaurants. Built in the good days, or at least the days of easy credit...but now people can`t even afford 380 yen for a small bowl of beef and rice.
Actually eating leftovers from dinner is a lot cheaper, and choosing a hard boiled egg or some beans and some rice is also cheaper and that is what is giving these beef bowl restaurants trouble. Substitution!
The Saudi's have stated that the $70 price range is ideal, in part to keep pressure on the Iranian government. Iran needs higher prices than that to maintain generous food and energy subsidies and keep their people under control (to some extent). SA, besides buying weapons to counter a Iranian treat, can destablize Iran by keeping oil prices in check. I suspect that when prices start inching toward $90 they will start flooding the market with oil (I believe they have about 4MBD excess capacity now). That will also give the worlds economies a chance to mend, which is also to their benefit.
I agree that it is a good thing for the world economy that the Saudis have magical oil fields that don't deplete.
Swerve, I would be interested to know what you are basing the Saudi 4MBD excess number on. For many years Sheik Yamani, Harvard educated and a brilliant tactician, ensured that Saudi oil production kept oil prices in a range which limited the development of alternative forms of energy. This is what stopped alternative energy development in the 70's. I don't believe the Saudi's have forgotten that their economy is a one act play. Oil is it and if the price goes too high alternatives come to play, and to some extent already have. From 2005 to 2008 prices skyrocketed while Saudi production declined. If they could have prevented this they would have. I don't care what one of their oil ministers says, 4MBD excess capacity is simply not there.
The year over year comparisons are interesting. Oil averaged $42 in January, 2009 and about $79 in January, 2010.
My 2¢ worth:
OECD Government Spending Versus Declining Net Oil Exports
Based on our (Foucher & Brown) mathematical modeling and based on recent case histories, in my opinion a plausible estimate is that global consumers may be depleting post-2005 global Cumulative Net Oil Exports (CNOE) at the rate of about 6%/year in the 2005 to 2015 time frame (which suggests that we may have already burned through around one-fifth of post-2005 CNOE), although the actual annual decline in the annual volume of net oil exports may only be on the order of about 1%/year or so (the post-peak net export depletion rate tends to be far greater than the annual net export decline rate).
As oil prices have increased in recent years, we have seen a clear pattern of increasing non-OECD oil consumption and declining OECD oil consumption. In the recent Barrons’ Roundtable discussion, Marc Faber noted that the total size of the developing non-OECD economies exceeds the total size of the developed OECD economies. Give the developing world’s rapid increase in oil consumption, this has obvious implications for OECD countries.
Based on our work, we are expecting to see a long term accelerating rate of decline in net oil exports, and based on recent trends, OECD countries can look forward to being forced to make do with a declining share of a declining total volume of net oil exports.
The logical course of action given such an outlook would be to implement measures to reduce overall consumption (with a crash electrified rail program), but the problem is that so much of OECD economies, and therefore OECD government revenues (especially in the US), are dependent on consumption spending, and in fact most government revenue projections assume a resumed increase in consumption.
It would probably be difficult, outside of some Scandinavian countries I suppose, to find examples of local, regional and national OECD countries that don’t have budget problems. Here in Texas for example, the City of Dallas and the State of Texas are both looking at severe budget crunches next year, and the only reason the Texas state budget is currently balanced is because of federal stimulus money. And of course, we all know about the federal budget problems.
So, we have numerous local, regional and national governments that are basically basing their budget forecasts on the assumption of a near infinite rate of increase in our consumption of a finite fossil fuel resource base--while I believe that the reality is that oil importing OECD countries can look forward to consuming a declining share of a declining supply of global net oil exports, with oil importing developing non-OECD countries consuming an increasing share of a declining supply of global net oil exports.
The 1930’s Case History & the Outlook for Oil Prices
It appears that oil demand in the Thirties only fell one year, in 1930, with global demand rising thereafter, and US oil prices rose at about 11%/year, from the summer of 1931 to the summer of 1937. Note that this price increase occurred despite rising global crude oil production.
I anticipate that the 2010 average annual oil price will exceed the average price of $62 we saw in 2009, with annual oil prices increasing after 2010, unless and until global net oil import demand once again falls below what I believe will be a declining supply of net oil exports.
Excellent points. Even though the EIA is predicting OECD demand to be almost exactly the same in 2010 as 2009, that is nothing to cheer about - as Faber points out. However for the first half of 2010 I see some minor improvement in OECD demand - mostly because of relatively stable oil prices, increasing population, and a small economic recovery.
The part about "we are expecting to see a long term accelerating rate of decline in net oil exports" has truly frightening economic implications for our future.
http://www.eurekalert.org/pub_releases/2010-01/naos-ngs012910.php
'eurekalert' - right, what ever;¬)
Note the legal weasel word that precedes indicating the author - allegedly, knows they are lying and so with some legal knowledge takes refuge in sophistry.
* emphasis added.
Our man, Jean:
http://europe.theoildrum.com/node/3819
bell -- Given that no one has been able to recover any hydrates even on an experimental basis even "may" seems a tad dishonest.
This methane hydrate business kinda reminds me of fusion energy "just around the corner".
jjhman, You mean " Fusion is the energy source of the future, and always will be"?
...and also ;¬).
May is a great legal cover for all sorts of nonsense:
e.x.x. the value of investments indicated may not reflect future performance;
We may initiate legal action;
Personally I think each instance should be required by statute law to be accompanied by this caveat in parentheses.
(As in you may be a self confessed player of the pink oboe but I couldn't possibly comment) :¬))))
In season 2 of History Channels "Ice Road Truckers". they were engaged in an experimental drilling for "gas hydrates, a solid form of natural gas".
Link to video: http://www.history.com/video.do?name=iceroadtruckers&bcpid=1543292465&bc...
Preview: That link took me to the wrong video, and I can't figure out how to get to the right one.
In season 2, a rookie fumbles, part 1, at 6:50, is an explanation of why the scientists are there doing the test drilling. IRRC they called the test well successful after flaring.
Regarding the "tip of the iceberg" article. We might think this sort of thinking is confined to a small wackjob fringe. IMHO, that isn't the case, I've been surprised by how many otherwise smart rightists espouse the new world order conspiracy theory. I think this has been promoted to the dittoheads so long and so often, that they have come be believe it, and not realize just how delusional it appears to the rest of us.
As for the article stating lack of refinery new builds; that is no longer true. Refinery capacity is overbuilt and the nation's largest refiner Valero had to close refineries. There is excess refinery capacity and profits are down, thus taxes are down, and the government cannot collect on building refineries that were not needed. Should have used the steel elsewhere. Some spending led to poverty for it was money wasted. Heavy drinking, gambling, consorting with prostitutes, and drug abuse was money wasted. Unnecessary war was money wasted.
Behind a paywall, unfortunately.
Mexico's Maya Crude Suffers From Decline in Quality and Production
I guess they're scraping the bottom of the barrel...
Re: India NOC moving to buy interest in foreign oil fields. Apparently the Indian gov't is beginning to take a hint from the Chinese playbook. But it's a meager start: the $2.5 billion budget might sound like a lot but in the world of major oil development projects (especially offshore) this will just barely get them a seat at the table. But it does get them into the game. A game that the U.S. gov't has so far decided to pass on.
It will be interesting to see if more of the govt's of the oil importers decide to get into the game. Take that proposition to an extreme: in time half of the exported oil now belongs to the NOC's of various oil-importing countries. As this oil would be effectively removed from the free market it would also effectively heighten the effect of PO relative to any country that didn't participate in this game. While we speculate how much oil for export might be produced in, lets say, 2020 that doesn't mean that amount of oil would be available to the highest bidder such as the U.S.
Of course, the U.S. would still have the option to go to war with India, Germany or whoever and take their oil. Why not? It’s been almost 70 years since we’ve had a world war. Probably time for another.
Except that in recent years, China & India (and other developing countries) have been effectively outbidding the US for oil imports--since they have shown increasing oil consumption in response to the post-1998 increase in oil prices, while US consumption in 2008 was back to our 1999 level, and I believe below that in 2009.
My outlook for the US and for other developed oil importing OECD countries is that we can look forward to a declining share of a declining volume of global net oil exports.
True WT but I was referring to out years. But your point also emphasizes a potential double whammy for U.S. crude buyers: Oil importing country X desires Y millions of bbl/day. They are getting 30% of that volume from their share of producing fields they had purchased in previous years. Oil's current price is $100/bbl. But the net cost to Country X for the production share is $40/bbl. Thus they are getting that 30% of their demand at $60/bbl less than the U.S. would be paying. They could readily use that extra capital to they saved to outbid the U.S. for oil on the open market. Bottom line they could effectively cost average and buy all the oil they wanted at a cost effectively less than the U.S. could pay.
I've used that approach more than once to beat a competitor.
It is worse than that. Consumption in the US, (petroleum products supplied), in 2009 was below 1998 levels and just barely above 1997 levels. In million barrels per day:
1997 18,620
1998 18,917
1999 19,519
2005 20,820 (Peak)
2008 19,498
2009 18,676
Table 3.1 Petroleum Overview
In 2009 we were 2,144,000 barrels per day below our peak in 2005. That is a drop of 10.3 percent.
Ron P.
~21 billion barrels per day ?
Obviously it should be thousands of barrels instead of millions - just a misprint.
Indeed. And in any sort of marginal analysis, this is not surprising. US marginal utility of petroleum (or willingness to pay for getting one more gallon, or lost utility if one gallon goes away, or any other way you want to express the concept) has got to be lower than that of a developing country. Literally, the US marginal utility is something trivial like "A poor person didn't have to bother to check their tire pressure." China and India's marginal utility is almost certainly something with more value than that. Resources flow to those able to extract the most value from them.
Does anyone have up to date information on the quality of world oil produced and crude oil imported to this Country? What are the refining implications in the Mexican scenario?
The oil being produced world-wide and being imported into the US is becoming increasingly heavier, but refineries are being modified to process heavier oil. This is part of an ongoing trend and is nothing new.
The fact that Mexican oil production is becoming heavier is not a problem for the US because US refineries can handle it. The fact that Mexican oil production is falling is more of a problem, because there are few countries which can ramp up their production to take the place of Mexican oil.
Mexico is going to become a net importer of oil in the not-too-distant future, so the problem of them exporting heavier oil is going to be moot in the long term. The fact that they will not be able to export oil at all will be a problem for both Mexico and the US.
For anyone interested in total global grain stocks, I did a follow-up to the article I posted here a week ago where I challenged Jim Rogers CNBC statement "The inventories are now at the lowest they've been in decades, not in years." This time, I linked FAO, EPI, IGC, and USDA reports which all conclude that we are at a 7-8 year high in stocks and a 7-year high in days of consumption (EPI), clearly discrediting his statement. The reports are really quite reassuring since there seems to be some fear-mongering going on about the world being so short of food right now. Additionally, production in S. America is looking very strong.
As I said a week ago, I suspect it may be traders who have to cover some wrong bullish trades from this past year as grain commodities are low now and many were bullish all things Ag a year ago. Interestingly, I saw that El Nino is expected to boost US crops in 2010, but it may hurt crops in Australia and SE Asia. Also, in this week's news the WSJ states that 33% of the U.S. corn crop is going to ethanol, higher than the 25% the UK Guardian claimed last week, and a bonus article about which meat the female President of Argentina says is like Viagra....
Note to Ghung, rice article will be next week.
Thanks, Kalpa. Looking forward to it.
Shorting Jim Rogers a brave or foolish man.
Just one point, wasn't Australian crop failure a major cause of the last rise in grain prices...
bell,as an Australian I'm not sure if Australia is a big enough producer to have a major effect on the world market.
There are dry land grain producing regions in the 3 Eastern states as well as South Australia and West Australia.The latter has major problems with salinity and all areas have frequent droughts.
This is the nature of the Australian climate - wild variability.This may become more pronounced due to climate change.
So,if Australia does in fact have a major effect on the world market the look forward to more volatility.
Australia exports 80% of its wheat crop and contributes between and 8 and 15% of the world trade, making it the fourth largest exporter after the United States, Canada and the European Union.
It is a major global player in this industry. If the Australian wheat crop fails, a lot of people in third world countries will be short of bread.
From my report: Global wheat supplies for 2009/10 are projected 2.5 million tons higher, mostly reflecting an increase in reported output by Russia.
The lastest update says that projected global stocks are up this month by 4.7 million tons to 195.6 million, resulting in a 30-percent stocks-to-use ratio.
(Wheat is especially weak right now. Projected acreage is low in the U.S. for 2010.)
Very interesting Kalpa... I for one have picked up on the fear-mongering, as you call it, and definitely needed to read the "Don't Panic" - message.
I have a couple of quibbles ad your blog post, however. You write that
No, we cannot see that from the chart, since it's just a 13-month chart. If we go to the FAO World Food Outlook page you link to, however, your chart is presented side by side with this one:
So clearly food prices in general have not been "relatively flat" for the last two years. But judging from your chart, the volatility might be due to sugar and dairy rather than cereals... so we must look a bit further. Here they provide an .xls that has monthly data going back to jan '08; I charted the food (total) and cereal (sub) PIs from that, along with (monthly averages of) world crude spot prices from the EIA:
So we see the cereal PI isn't pulling the total upwards like it was in '08, but it's not pulling it downwards either.
However, even this two-year picture is a bit misleading. From the Dec. 2009 Food Outlook:
In dec-09 both the total and the cereal index was above 170!
Methinks that saying that those are low prices is like saying that oil is cheap at 70$/bbl... it isn't.
Welcome to the New Normal!
After looking at excerpt from the "Obama Orders Government To Slash GHG Emissions 28%" article, it occurred to me that the POTUS is very peak oil aware. It's just that he, like any sane, rational politician dare not utter the words peak and oil in the same sentence. That would be sort of akin to yelling fire in a crowded theater.
Could it be that these actions taken under the guise of cutting GHG emissions are just Peak Oil mitigation in disguise? Is it that, since the evidence for climate change is more visible, the pretext of cutting GHG is more politically palatable than publicly advocating Peak Oil mitigation?
Alan from the islands
Yes.
Very broadly, what I see is ...
If you move hard left, you will find lefties who believe that peak oil is a corporate conspiracy.
In the soft left, you find peak oil and AGW accepted.
In the soft right, you find peak oil and AGW rejected.
If you move hard right, you will find righties who believe that AGW is a big-government/nwo conspiracy.
I think that there is a political undertone to both debates:
Peak Oil suggests that the market might not be able to provide.
AGW suggests that the govt might need to intervene in the market.
And thus, people's political philosophies affect their acceptance or rejection of both theories.
Most of the people with me on the "hard left" agree that peak oil is a natural geological phenomena, since they are open to accepting scientific evidence. All have agreed that Global Warming is caused by people burning fossil fuels, which is why we see rising amounts of CO2 in the atmosphere--very elementry cause and effect denier's deny, which makes them a laughingstock.
The market doesn't "provide" anything other than a physical location for transacting commerce.
Government/politics certainly drives both Peak Oil and Global Warming--it's subsidized both, which it must cease doing.
Both Global Warming and Peak Oil are proven theories, as is Evolution; so, only people wanting to advertise their level of ignorace reject proven theories. And there are a lot of ignorant people--almost 200 Million in the USA--and as a rule, ignorant people are incapable of formulating a coherent philosophy on any subject.
As I see it, we have some informed people and a very large number of ignorant people, of which only a small fraction are open to becoming informed. The oligarchy likes it this way as it can sic the ignorant on the informed because they are ignorant of their being manipulated. The meek may inherit the earth, but the only way that's possible is for the meek to NOT be ignorant.
Alex Cockburn is what most anyone would call 'hard left' and he is a AGW denier.
puzzling to me but i can't write it off simply to ignorance.
My reading of it that he is a contrarian by nature and he is as suspicious of 'big science' as the right wingers.
it is a borderline paranoia that all major scientific organizations are corrupt and venal. data gets manipulated and we all get played for suckers.
personally i agree the data is the data and the observations are just the observations and to stubbornly deny facts makes you look like an idiot.
But to a sincere ideologue facts are, well...
Cockburn is an intelligent fellow but I have to say that his attraction to abiotic oil strikes me as being born of ignorance (not just contrariness). If he'd spent a few years in any of the earth science fields, he'd have a greater appreciation for the level of understanding and the range of tools at the disposal of petro geologist types. To my knowledge, AC doesn't deny AGW (or did I miss something?).
well, here, wade through this farrago and draw your own conclusions...
Counterpunch, last December
for my part, i didn't realize he believed in abiotic oil.
sad...always respected the man.
I knew about Cockburn, which is why I said "most."
I find that, when looking at the 'middle' of the spectrum (be it on a two-axis or simple left-right axis), it's hard to tell the difference between 'left' and 'right'. Similarly, when you go to the far - and I mean far - extremes (again, two or single axis), it's hard to tell the difference between 'lefties' and 'righties'.
Your suggestion that cutting GHG emissions might be a "cover" for dealing with the problem of Peak Oil misses the fact that it's possible to convert coal to liquid fuels. Also, tar sands production and oil shale both offer liquid fuels which might replace some of the oil presently used as imports decline after Peak Oil. A serious effort to cut GHG emissions would make these alternative sources of liquids much more difficult to justify.
E. Swanson
I don't see how this is contrary to what I was suggesting since Coal to liquids and tar sands production both involve huge increases in GHG emissions. In that event, serious efforts to cut GHG emissions might also make them unnecessary.
Alan from the islands
No.
Unless you have evidence, you're simply speculating, trying to account for the public nonacceptance of the peak oil argument.
Never shout "conspiracy" in a crowded theater.
I have all the evidence for climate change (notice I did NOT say global warming) I need. I am 48 years old and live in the tropics. The first experience of a hurricane I can remember was a very close brush in 1980 at the age of 18. My next memory was a direct hit in 1988 and since then there have been several more close brushes, two of which occurred in the last 7 years. Any one living in areas susceptible to hurricanes does not need a climatologist or statistician to tell them that these storms are getting more frequent and more severe. We experience these things first hand.
All over the world people are experiencing weird weather. Planting and harvesting seasons that have been a given for decades or even centuries, for all sort of crops seem to be open to question. That is what I mean by "evidence for climate change is more visible". On the other hand I and most other people have no idea of how much oil is left in the ground and what flow rates are likely to be, apart from what the experts tell us. There is a huge difference.
There are several things that suggest to me Obama is Peak Oil Aware, his support for high speed rail is one that comes immediately to mind. I invite you to try and write a speech in which the POTUS tells America and the world about Peak Oil and what it means for our civilization.
Alan from the islands
One of my first contributions to the Drum, a few months ago:
I remember that post. That's where I got the idea for the invitation from! I can just imagine the headlines in the newspapers the day after:
"Republicans in congress move to impeach the president..."
"It's official, the president has gone insane...."
"Obama joins lunatic fringe........"
As if that speech could ever be made before TSHTF.
Alan from the islands
No - just another conspiracy theory.
It is the carbon in the air that is the problem - not the one in the ground.
Even if Obama is aware of peak oil - he may not think of it as a big problem. A lot of them think that the fix is as simple as increasing number of hybrids on the road.
Peak oil? Consider it solved
http://www.salon.com/news/feature/2008/03/28/peak_oil_solutions/
No, it only appears that way because some of the mitigation strategies to deal with GHG pollution apply to peak oil. Obama has been using stimulus and bailout to encourage economic growth. Reducing population is nowhere on his agenda, for example, he allowed anti-abortion rules into his health insurance reform bill, supports immigration and guest worker programs. He sent aide to Haiti while his wife pleaded for Americans to send donations and is extending an emergency guest worker program to Haitians already in the U.S. He supports globalization which requires plentiful, cheap energy to move stuff around the world and ignores localization. He does not support Alan Drake's proposal to electrify long distance freight rail which is absolutely critical to move food and products among farms, cities and ports. He refuses to withdraw from the war in Iraq.
Since President Obama is not implementing a strategy to mitigate it, I conclude he does not understand peak oil.
Now here's a way to make a living: suing debt collectors.
Better Off Deadbeat: Craig Cunningham Has a Simple Solution for Getting Bill Collectors Off His Back. He Sues Them.
Smirk! Whats that word..schadenfreude!
A view from the Peak...
Had an interesting couple of days, that I'm afraid portend the future. Yesterday morning went out and started my car to let it warm up for a few minutes in the 10 degree air. Came back out and the engine had stopped. The car would not start, and the check engine light was on. So i popped the hood and looked and the engine was still there :) .
Disconnected the battery to reboot the computer so to speak, and tried again but the engine would not start and I could not smell any gas after cranking it repeatedly. So I got it towed to a service station about a mile away ($65 -not too bad), and I got a call a couple hours later that it was the fuel pump that needed to be replace and all together it would be about $950 - to replace it on my 2003 saturn. So i said go ahead fix it,and they said it would be ready Saturday by noon.
I then pumped up my tires on my bike and dressed appropriately and road my bike the 3 miles to work. Glad I relocated and found a job close to my apartment. Then I took my laptop home with me Friday afternoon like I usually do to be able to do a little work and in case something happens and I can't get back to work on Monday. Today I got a call from the service station and they discovered that the wiring harness was also corroded and that was probably what caused the pump to fail, and they were trying to locate one but it would be Monday afternoon at the earliest and perhaps at late as Wednesday before they were able to locate one. (Note Saturn owners: If you buy a part from a Saturn dealer you cannot return it since they are going out of business - and the service station was checking junkyards to see if they could get one that was in good condition).
I have been thinking about replacing the car after Penske was unable to get anyone to mfg. them and the brand was declared dead. Just wish I would have done it instead of thought about it. I imagine this sort of regret will become more commonplace going forward regarding a lot of things. ($1000 repair for a car with a private value of 4-$5000 - Kelley Blue Book).
I started to imagine that If I did not have a good job or if I lived paycheck to paycheck that these kinds of events would quickly create a crisis. This also prompted me to think how I can live without a car. Off to figure out how to put an old milk crate on the rear rack of my bike so I can go get some groceries. The ride will be invigorating.
You might try eBay for that fuel pump. There are folks selling generic pumps for about 75 bucks (some assembly required). Try this link. And, I think the charge for replacing the pump might be a bit high as well.
E. Swanson
Thanks Black Dog, I may need to try that, will know more on Monday if they were able to find one.
The labor part I can't argue with $ for the labor to empty (full tank 16 gallons) drop the tank, and replace the fuel pump which is inside the gas tank and now replace the wiring harness from the engine compartment on back. I am guess that's probably 6-8 hours labor at least in terms of the "book". I don't begrudge the mechanic the labor $. I used to wrench a lot and do all of my own maintenance on my vehicles as well as other equipment. I just don't have access to tools or a lift, nor the inclination to work on the car in this weather. The $450 I am being charged for the pump itself is where I am not happy, but I do think this will be a common occurrence as the supply of spare parts from manufacturers dries up and people take advantage of the old saw, "There not making any more of them...".
I saw this possibility, but like a teenager, did not think it would happen to me, at least not so soon. My other Saturn I got 195,000 miles on it with rotors being the only replacement, before I gave it to my nephew. He got about 5-,6000 more before it lost compression. Just wanted to share this experience so other Saturn owners or potential owners are aware of the risks.
Get a bike trailer, too--you can often buy a used one for less than $100. They carry WAY more than a milk crate. I took my two kids to school in a trailer for a couple years, before they could ride themselves. I keep on fixing my old car, but I'm very happy to have it be a luxury, not a necessity.
I made it back with the milk crate strapped with an old dog leash, crude but effective....
Another regret,.... not buying those panniers last year when nashbar had some really good sales. Definitely going to put those on the list for the next big sale.
A trailer I will have to look into as well. Last few years at the MREA energy fair, I've seen some pretty cool setups. One presentation showed how these young college kids moved one of their roommates to a new apartment about 10 miles or so across St Paul all on bikes w/ trailers. Furniture, beds, books, the works.
I think my car will become a luxury too. I just realized today that I only really need it for about 5-10-15% of my travel. The rest, not so much. A 10-15 minute ride even in 10-15 degree weather ain't bad at all. In fact, I may go out again later today just for fun.
Yes, a 3 mile ride will take you only 10-15 minutes on a bicycle. That's barely enough to qualify as an aerobic workout. But if you do it every day, your level of physical fitness will improve significantly.
On the other hand, those commuting in their SUVs are still developing type II diabetes and getting ready for their first heart attack. The majority of the US population is getting unbelievably fat because they never get any exercise.
I don't think that's it. There are lots of reasons to exercise, and I have no doubt there are health benefits. But I think the evidence is showing that it doesn't help much for weight control.
Taubes and others have pointed out that the sharp increase in obesity among Americans did not coincide with a similar decrease in activity. Something else is going on.
High Fructose Corn Syrup (HFCS).
rev karl
I think that's definitely a possibility.
Taubes suggests that it might be carbohydrates in general. The sharp increase in obesity coincided with the the government's recommending a low-fat diet. Low fat in and of itself may not be bad, but people have to eat something instead of fat, and that turned out to be carbs. (The fact that refined carbs are insanely profitable for the food industry didn't hurt.)
Ironically, the problem might be that Americans actually did listen to government health recommendations.
That might be a big part of it. In one "theory" the body craves a minimum amount of protein and fat. Go to low fat food, and you simply eat much more until you get your fill of fat. I also think that industrial for profit free enterprise has a lot to do with it. The food companies play with the ingredients with the intent of addicting the public to their product. I think they have been quite successful at that endeavour. We wish the incentives would be to make food healthy. But that does not optimize the profit for the producers and packagers of the product. I think Americans free market obsession is one reason we are less healthy than other developed nations.
There's research that suggests eating a lot of carbs, especially refined carbs, causes metabolic changes that result in insulin resistance and increased hunger. (This may be a problem with HFCS, in particular.) Support is growing for this view. The American Heart Association changed their recommendations to suggest more fat and less sugar. When an acquaintance of mine had a heart attack in Ohio, he was told by his cardiologist that cutting back on refined carbs was the most important thing he needed to do - more than exercise or cutting back on fat.
As a triathlon junkie in the mid-to-late Noughties I read up quite a bit on this nutrition stuff, and this high-glycemic-index-carbs-are-evil was quite the fad.
I definitely think there is quite a lot to it, but like all fads, it's overstated. The last I read on the subject (in a printed norwegian magazine, sorry) was that moderate physical activity can severely reduce or even completely nullify the effect.
Basically, the damage a meal with a high glycemic load will do depends on your insulin response, and people in good physical shape generally have a good insulin response. This helps in two ways, one, because your peak blood glucose level will be lower (which is good because glucose is a very reactive substance that in high concentrations causes all sort of havoc in your body (see AGE for instance)); two, that means you'll also have lower peak insulin levels, because insulin is the chief hormone signalling the body to sequester/use glucose at an accelerated rate, and insulin is strongly anabolic (which means high levels make you gain weight).
Also, when your muscles are active (and for awhile after being active), they will suck up glucose from the bloodstream without insulin being released.
Note that while being in good shape is correlated to good insulin response, heavy exercise will temporarily lower it, so people with initially poor insulin resonses (diabetics or near-diabetics) should not do too heavy exercise, nor should they exercise too often (every other day will do).
Additionally, and particularly if you are trying to lose weight, you should not exercise when your insulin levels are high (that'll reduce fat metabolism and increase glucose metabolism, which in the best case nullifies the intended fat loss and in the worst case leads to hypoglycemia, which you don't want). Insulin levels will be highest roughly an hour after a high-glycemic-load meal, so it's advisable to either start at once after eating or wait at least two hours.
----
The prevailing view among sports nutritionists seems to be that a balanced diet (roughly, in energy-%, 30/30/40 protein/fat/carbs, with generous helpings of fruits and veggies) is the best for atletic performance.
Now "athletic performance" is not "health" but...
When you look at diets around the world you'll see that they tend to be high in carbs and low in protein. Think Asia or South America. Lots of rice (or corn in SA), noodles and skinny people. Ultimately, if you take in more calories than you burn you will gain weight.
Obviously eating tons of corn, either directly in the form of tortillas or indirectly in the form of soda or chickens by people who genetically are not set up for that is going to have consequences. In the US corn has only been around in significant quantities for the last 70 years or so, not enough to get a lot of genetic self-selection among consumers.
In the US food may be cheap at the point of sale, but perhaps the lifetime costs are a whole lot higher than is immediate obvious.
Rgds
WeekendPeak
Taubes argues that the what you're seeing there is simply caloric restriction. People can't afford to eat a lot of fat and protein, and they can't afford to eat much rice, either. Caloric restriction is known to prolong life among a variety of animals, and humans may be one of them.
Yes, no one is arguing that. The point is, what makes so many people take in more calories than they burn?
Historically that may have been true, and it may still be true in some countries/regions that the diet not so much a choice as it is a constraint, but it certainly is not true in countries like Singapore, Japan, and (S.A.R) Hong Kong.
Obesity is not a problem with a single explanatory variable. Thinks like a mismatch between one's genetic disposition and the diet one eats, poor education, a sudden transition to a sedentary lifestyle while maintaining the pre-sedentary diet, lots of processed food, food which is completely unnatural (for example salmon which are fed corn and soy pellets - when is the last time you saw a salmon roaming through a cornfield??) etc etc. And perhaps BMI is not correctly scaled to reality – there seems a fair amount of (some anecdotal) evidence that people who are somewhat overweight actually live longer and healthier. There seems little correlation between BMI and lifespan as I recall.
Rgds
WeekendPeak
Yes, but a lot of the research that led to the recommendation of a grain-based diet was done back in the '60s.
Now, obesity is a growing problem even in Japan, China, etc.
I suspect we are not really meant to eat grain. At least, not as much as we are eating. Our stone age ancestors undoubtedly ate some grain, but probably not a whole lot, since it's kind of a lot of work to harvest and prepare with stone age technology. It's likely most their diet was meat-based. But that's not a sustainable option for 7 billion people.
Actually, we are. We are heavily adapted to eating grain.
I was reading a book called "Before the Dawn: Recovering the Lost History of Our Ancestors" by Nicholas Wade. His theory was that, rather than slowing to a halt, human evolution has actually accelerated in the past few thousand years. He is working from DNA evidence and provides numerous examples of recent genetic shifts.
Eating grain is a relatively recent development in our evolution, but it is important from a survival standpoint because the grain-eating societies wiped out the non-grain eating societies just by sheer force of numbers. We are all descended from people who got most of their calories from grain. The people who couldn't eat grain almost all starved to death in the innumerable famines of the past few thousand years.
The real problem is high-fructose corn syrup. Corn doesn't naturally contain fructose, and converting it into fructose is a development of the 20th century. Historically, sugar was a scarce and highly desirable food, but with high-fructose corn syrup, most people can afford to eat more sugar than their pancreas can handle. The result is an epidemic of type II diabetes.
We need to evolve a bit more to handle all this high-fructose corn syrup we get in every food you read list of ingredients for.
But see, that's the point. Famine was never a much of an issue until the invention of agriculture. If you don't get enough to eat, then it doesn't matter what you eat.
It's when you can eat all you want that grain becomes a problem.
Famine has always been an issue in human survival. There have always been periods where food was scarce and as a result, human beings are very heavily adapted to surviving a famine. In pre-historic times very few people died from having too much food, but an awful lot died from having too little. That's why starvation diets don't work - if you cut your calorie intake too far, your metabolism goes into famine survival mode, your energy use drops dramatically, and you become desperately hungry as your body tries to claw its weight back up to its previous level.
However, if you can broaden your diet in a famine, you have an advantage. That's why gluten intolerance is quite rare in modern humans (rarer than people seem to think) - during the regular famines the gluten intolerant died out while the gluten tolerant ate grain. After grain-growing became common, gluten tolerance became a non-optional part of the human makeup.
Lactose tolerance in adults is more recent (only since the domestication of milk cows) and rarer - basically it's Northern Europeans and a couple of tribes in Africa that can tolerate lactose as adults. A lot of people don't realize this - most of the world is still lactose intolerant. And we haven't developed a tolerance to high levels of sugar consumption yet, hence the rise in type II diabetes. Diabetes is particularly common in North American Indians who never had a need to develop sugar tolerance.
The modern problem is that we haven't adapted to our new diet of high fructose soft drinks, McCardiac burgers, and high-sodium french fries. Enough people haven't died of it yet to select for the genes that would make it survivable for our descendants. However, the smart thing to do is not wait for the Darwinian solution, but just cut these things out of our diet. Unlike our ancestors, we have too much food available rather than too little. We're not genetically adapted to that scenario.
I don't think that's true. Foraging societies today have a hard time even understanding the concept of famine.
Famine started happening with agriculture. That's when you start seeing evidence in ancient bones of stunting and other problems caused by malnutrition. Stone age peoples were as tall and robust as modern ones.
Eat too much you get fat, eat too much sugar your teeth fall out, positive correlation between education level and obesity.
What do I know, it certainly could not possibly be your fault;¬)
Hi colburn,
Trailers really are wonderful gadgets. When I was a youngster in my early 40s, my wife and I decided to tour Yellowstone by flying into Billings, MT. A few days before we were to start the trip, she announced that her back was bothering her and she didn't think she could carry the extra weight of the panniers.
I pick up a trailer, loaded it to 80 lbs with tents, sleeping bags, etc and off we went. We climbed to almost 11,000 ft going over the Bear-tooth Pass and the trailer worked very well. We put on about 500 miles on that trip and never could have done it without the trailer.
We are a bit over and under the 70 year mark now and still ride our tandem bike 20 miles or more nearly every day (nine mos of the yr). But, I agree that 20 miles is probably not going to do much for your weight. 60-70 miles a day, 4 times a week might help. This darn weight issue is my toughest challenge.
Seoul’s path to nuclear power
"it has eight nuclear reactors under construction and 10 more planned for 2030"
My friends in Seoul say - with a laugh - that their nation's nuc plants are all built along the East Coast, so that if there's a "problem," the prevailing winds will carry it away, toward Japan.
No worries; let's order more soju.
Just curious, is that handle N. Oliver or NO liver?
Cheers ;-)
Ghung, it's both.
As an old chemist with a taste for soju, my liver's long gone.
Ah, but what will the Koreans eat? 400 per sq. km. There's a reason they were trying to buy Madagascar. And why we're no longer there.
Ah, soju! The breakfast of ajoshis!
Cheers
Link up top: Russia and Antarctica
I don't believe it, not even if oil reaches $1,000 a barrel. A recent expidition tried to drill the Antarctic Continental Shelf just to sample the sediment, for geological educational reasons, and had only partial success for an extremely short period of time.
Quick Drilling on the Antarctic Continental Shelf
They were able to hold station for only a few hours. Imagine a huge drill ship trying to hold station for months. Then if successful, a platform would have to hold station for years amid icebergs as large as a small state.
And drilling on the continent would be even bigger challange. The ice is one to two miles deep and it flows at a rate of several feet per day.
Ron P.
I read this article right up to the following point, at which I stopped due to the mention of abiotic oil and the blatent display of ignorance.
"The Fateful Geological Prize Called Haiti by F. William Engdahl"
"It is critical to note that, more than half a century ago, a group of Russian and Ukrainian geophysicists, working in state secrecy, confirmed that hydrocarbons originated deep in the earth’s mantle under conditions similar to a giant burning cauldron at extreme temperature and pressure. They demonstrated that, contrary to US and accepted Western ‘mainstream’ geology, hydrocarbons were not the result of dead dinosaur detritus concentrated and compressed and somehow transformed into oil and gas millions of years ago, nor of algae or other biological material"
Incidently, my understanding of the "oil comes from dinosaurs" myth is that Sinclair Oil used a brontosaurus on their logo decades ago, so the public got the idea that their car engines were burning squished dinosaurs.
Engdahl has some interesting things to say but his geology is shaky, to say the least. Too bad as it diminishes his overall credibility IMHO.
POT -- AS I proclaimed a while back I, a petroleum geologist for 34 years, have fully accepted the abiotic origin of oil. Now all I need is for someone to point where this abiotc oil has been hidding all my career. As we've fairly identified regions of biotic oil I'm very ready to refocus my efforts in developing this untapped resource. Please post those maps ASAP.
ROCKMAN you have my email address for 50k a month I'll send you all the maps you want.
Hey, now that oil has been declared inexhaustible, we should all become exploration geologists. Talk about job security!
Sounds great memmel. BTW I'll be paying your fee out of the cash flow from my abiotic oil discoveries. You're not the first I've made such an offer to. Many prospect generators have come to me with a "can't miss" project. I say "Great! If it can't miss I'll pay you out of the revenue stream instead of the hundreds of thousands of $'s you're asking for upfront. In fact, I'll even double what you're asking for." You might be surprised how seldom my offer is accepted.
In the oil patch we call it "having skin in the game". Basicly if I win...you win. If I lose...you lose. I see two constants with the abioitc oil crowd. First, absolute certainty that abiotic oil exists. Second, absolutely no idea where we can drill for it. Maybe I missed it: has any TODer seen a proposed location and depth offered for the first abiotic oil test?
Oh, yeah. I recall being in an elevator with a dude who had collected millions from investors in an abiotic oil well. Him and his lawyer. I tend to pay attention, so I knew what was coming down the pike at him. He looked pretty upset, but his lawyer was grinning from ear to ear. It's those legal fees that make them so happy. What he was doing was promoting a well to find the abiotic source of the Alberta oil sands.
His lawyers did a stellar job, no doubt at vast expense, and managed to get him off without any jail time, although he did have to pay millions in fines and was barred from trading stocks for life. Unlike Martha Stewart he didn't lie to investigators. Admitting ignorance is always better defense than lying.
It's actually rather unclear what the ultimate source of the oil sands is, but about ten different possibilities have been suggested and they're all biotic. Some geologists believe that, given the sheer size of the resource, there must be multiple sources over a vast area all feeding oil into the same huge reservoir.
Anybody who knew anything about the oil sands would have known that the Canadian government drilled four wells right through the oil sands to find the source in the 1890s. They established conclusively that the source is not under the oil sands. However, they did hit natural gas, and two of their wells blew out and burned for several years before they got them under control.
Later on, people also discovered huge deposits of salt, resulting in a major salt industry They also found coal, and uranium, and some geologists believe there's a real possibility of diamonds.
However, it's been conclusively demonstrated that there's no abiotic oil. There's just about every other kind of valuable resource, but no abiotic oil in the area. Another brilliant 19th century theory shot to hell.
Rocky -- geochem isn't my thing but didn't they establish long ago that the oil in those Canadian sands had a biological origin?
Perhaps I missed it but has anyone discovered an oil that didn't have a proven biological origin? That's one reason I shy away from the debate about a method of abiotic oil generation. Let's just assume it can happen. But then we have to find that huge untapped reserve. And that's where the abiotic crowd always lets me down: no X marking the spot to drill.
Yes, they disproved the theory of the abiotic origin of the Canadian oil sands long ago. The only thing is, the actual mechanism of the formation is somewhat unclear, but it's a case of their being too many possibilities for what biological origin it had.
It doesn't really matter where the oil originated from, because it's not there any more, it's in the oil sands. It appears to have migrated in from several hundred miles away which confuses the issue enormously. In fact the geology of Alberta threw the geologists off so badly in the early days that oil men could have found considerably more oil by drilling completely at random than paying any attention to the geologists.
I don't think anybody has found any oil that clearly has a non-biological origin. The abiotic people have pointed to some anomalous oil deposits which they claim must have had a non-biological origin, but when you investigate you just find some really weird and wonderful geology. A lot of strange things have happened in the history of the Earth, but oil percolating up from non-biological origins in the deep inorganic depths is not one of them.
Oil does weird things at times, and if you have a big oil field it's worth drilling into nonobvious corners of it to see if it has gone somewhere you normally wouldn't expect, but people who drill deep wells on the assumption oil percolated up from the deep abyss are going to go bankrupt. You might find things that might once have been oil fields, but you aren't going to find any significant amount of oil. And deep wells are expensive.
Interesting Rocky. Sounds like parts of Alberta might fall under FUBAR. Early in my career I was surprised how many offshore fields were documented to have source rocks from significantly different geographic areas. Of course, there was a problem with oil mobility over distances of 100's of miles. Eventually the concept of an oil "precursor" (a much more mobil compound) was developed to explain such long distant transport. Not sure to what degree this concept was even proved.
The early oil discoveries in Alberta were highly anomalous and threw the geologists off track completely. As an example, the first oil discovery in Alberta was found in precambrian rock. That's absolutely the last place you should look for oil, but in that instance, precambrian rock had been overthrust over younger formations. The actual source was the younger formations underneath it, but they only figured that out 50 years later.
Other than that, most of the oil was too deep to reach with the early cable tool rigs, and the surface geology gave no indication of what was underneath. Most of the biggest oil fields in Canada are within an hour's drive of Edmonton, and it's all flat prairie. Nobody realized the area had once been a huge inland sea. They could only find the oil fields after seismic was invented, and even on seismic the indications are subtle. You get a velocity pulldown caused by the sound travelling faster through the producing formation, so what you see is a dip rather than a dome. The first big oil discovery was made in 1947 by Imperial oil after drilling 133 consecutive dry holes. They were about to give up, but they had been seeing these funny anomalies all over their seismic surveys, and tried drilling into one of them just to see what it was. BANG! It was a pinnacle reef and it contained more oil than they ever imagined. Old geologists still weep when they remember that day.
The oil sands are clearly a result of long-distance oil migration because there's nothing directly underneath them that could produce them. They appear to be a result of the formation of the Rocky Mountains, over 500 miles to the southwest. As the Rockies were overthrust over the plains, they pushed down the edge of the continent, creating a giant pressure-cooker the size of Texas, it cooked the oil out of all the source rock in the region, and all the oil migrated up-dip 500 miles to the oil sands.
Rocky -- Yes...odd little boogers out there. Long ago worked on a similar oddity in the SJ Basin in S CA. Only about 1000' deep and produced from fractured igneous rock. Surprised the abiotic crowd hasn't tossed this one out there as proof. It was just a weathered basement rock that was subsequently buried under the Miocene...a huge sorce rock for the area.
Not just decades ago, but they still do.
Engdahl is a longtime fixture among peak oilers. He used to be a peak oiler, then somehow became a believer in abiotic oil.
Are we just going to trade one import dependency for another?
Good that the Chinese are leading the way in wind and solar. Otherwise their stance on CO2 would look much more hypocritical.
From article above:
Soon enough China will be only no. 2 in GDP behind USA. Why should they be leading developing nations, i.e. hiding behind poorest African nations, i.e. using supposed abject poverty as an excuse for theirmassive expansion of coal burning.
No, that won't include poorest African nations.
Anyway, don't look at just GDP. Look at per capita - while China has a lot of rich yuppies the vast majority are still poor. Their per capita GDP is still 1/6th of US.
The average family in China is now middle-class, if you use the standard of having at least one-third of their income available for discretionary spending after food, clothing, and shelter are paid for. It takes a lot less money to be middle-class in China than the US because their cost of living is lower. How many people in the US have 1/3 of their income available for discretionary spending these days?
That totals over 600,000 middle class people in China, which is scary considering the total amount of disposable income they now have at their disposal. Car sales in China now exceed those in the US. China is also the world's largest emitter of CO2, having passed the US a year or two ago.
The median family, of course, is considerably below that, as more than half of the Chinese population are still rural peasants. I've lost it, but one of my favorite recent pictures set in China showed a 747 on final approach, with the tall city buildings in the distance, and in the foreground were a large group of peasants planting rice by hand. China has an enormous problem to deal with in the form of that more-than-half of the population.
The Chinese savings rate is also much higher than in any developed country, reducing discretionary income. The savings is needed for good reason: there's nothing like Social Security and Medicare, let alone the European social insurance programs, so saving for your old age is imperative.
The one-child-per-family policy will make it difficult for kids to support their parents or grandparents when they are elderly. In a graduate economics class I took, the prof asked, "How many of you here are the single child of single children?" Eight hands went up -- all students from China. China has one of the most rapidly "aging" populations in the world.
While population is occasionally mentioned on this forum,
one idea I don't see dug into too often is 'peak working population.'
The workforce in the US has aged,
baby-boomers are retiring.
Retirees don't feel the need to go out
and buy the 'latest and greatest.'
Growth slows down.
The same was happening in Western and Northern Europe.
The same will happen to China soon.
I suspect that the in the US and Europe,
this recession permanently curtailed some of the
profligate consumerism of the last 30 years.
So demographics also play a part in the energy/economy big picture
- not just through sheer numbers
- but also in numbers of workers -v- retirees -v- youth.
Recall Simmons warnings of an aging oil-field workforce.
Hi Ron,
Re Population: I noticed this in the Lester Brown article:
According to the Wikipedia article Urbanization in China, in 2008 China's population was 54% rural and 46% urban. The rural proportion was 64% in 2001 and 74% in 1990. By 2015 the rural/urban split is expected to be 50/50, and by 2035 it will be 70% urban.
The Chinese don't really have to save as much as they do - they just aren't used to having that much income. In future they will probably spend more of it on consumer goods such as cars.
I don't think that's true. They do need to save that much, because they don't have the social safety net we have in the western world. If you get sick or injured in China, you pay for your health care yourself...often borrowing money from relatives. I suspect if Americans, Canadians, Germans, etc., were in that boat, they would do as the Chinese do and save as much as they could.
Their MSM marketing machine hasn't refined its methods yet to the point where they can liberate the population from all of their discretionary income. Give it time.
No, the Chinese actually do have a pension system, but it's badly underfunded given their one-child policy and it doesn't really cover rural farmers. Given the uncertainty about it, most people prefer to have large amounts of money saved up to get them through regardless.
But mostly they're not used to having as much money as they do now, so they save much of it simply because, unlike Americans, they have not gotten used to spending as much money as they make.
Death by Lottery:
http://www.huffingtonpost.com/don-mcnay/death-by-lottery_b_443117.html
have you reduced your lifestyle today?
may i recommend stone knives and bearskins?
and nomadic wandering. no cities. no agriculture. no books.
$crew the world made by hand. try hard scrabble hunting gathering.
it's the only way. civilization has plagued this pretty planet long enough.
china makes clean energy products using filthy industrial manufacturing processes. and what will become of the world when all those chinese laborers make $14 per hour? it's not sustainable.
unless....titan, a moon of saturn is covered in hydrocarbons. IT HAS LAKES OF METHANE!!!! let's build space ships and go get it.
or...let's spend trillions of dollars on "defence". yeah, let's really reduce our lifestyle to extinction. what is the carbon foot print of the military? talk about the worse allocation of resources,
worse than suburbia and happy motoring.
i bet chucking world military would delay peak oil indefinately.
no one gets out of here alive.
"it's all good"
In China coal is clean energy. Carbon dioxide is not believed to be pollution. Chinese power plants emit more sulphur and ash than US plants. China was buying icoal deposits in Australia and shipping coal from Australia to China. King coal is making China rich. CONSOL coal in the United States has been considering shipping coal to China. Metallurgical coal is needed for steel and base metal production. Without its use industry would grind to a halt.
I still need to get my paper up on my new blog but this is exactly how I proved that peak oil is well in the past. Your missing Chinese coal imports which are not small in this graph but the basics are simple.
This massive increase in C02 emissions from Chinese coal has not resulted in dramatic changes in atmospheric C02 content ergo another source of C02 emissions had to decline.
I leave it as and exercise to the reader to pick which one.
Baloney.
Global CO2 ppm/yr readings from 1980 are increasing according to MS Excel. If the trendline continues by 2030 the rate will be at 2.5 ppm/yr. Since the rate of change is increasing, CO2 emissions are accelerating as high school calculus students are no doubt aware.
http://www.esrl.noaa.gov/gmd/ccgg/trends/
Dude your not capable of reading what I wrote ?
I did not say C02 emissions where not accelerating.
But since you posted the graph and I use the same one to show oil production is falling.
You had a substantial non-linear increase in one of our C02 source primarly chinese coal.
Obviously with your trendline atmosperic C02 is changing roughly linearly. I do a more through
analysis in my post.
But lets see you get a roughly linear change in C02 levels with a non-linear change in one of the inputs what happened to the other inputs ?
Well if they are linear or non-linear then one very large one has to be in decline the math is trivial.
Not only is it not Baloney its actually proof that oil production is in decline.
And I get hounded for not doing the math :)
Dude do the math you drew the two key graphs are right here.
Anyway I already did its non completely trivial. However the qualitative answer is obvious. If chinese coal consumption when non-linear as claimed and there is plenty of evidence that it has and C02 concentrations did not go non-linear and we know NG has increased then oil production declined.
Although there is a bit more to it i.e you have to consider population growth and do a bit of work its really not a hard problem and as I said a qualitative answer is easy to see.
No. The rate of change of CO2(ppm/yr) is linearly increasing.
Yes sorry that was not quite clear.
Re: Straw Homes That would defeat the wolf... or whatever.
BZZzzzZZZZzzzzzt!!!
Incorrect. It stands for Permanent culture. It's a design philosophy, not an agricultural system.
Now, you know they talked to people there at that Permaculture center, so how'd they make such a massive goof?
Cheers
ccpo
The front cover of my copy of Permacuture One reads:
PERMACULTURE ONE. A perennial Agriculture for Human Settlements. By Bill Mollison & David Holmgren.
The book starts:
"1.0 Introductory Comment. Permaculture Defined
Permaculture is a word we have coined for an integrated, evolving system of perennial or self-perpetuating plant and animal species useful to man. It is, in essence, a complete agricultural ecosystem, modelled on existing but simpler examples."
This very clearly states that it is about AGRICULTURE.
Sorry ccpo, but your supposed correction is itself incorrect.
Cheers, Merv
Over and over I look for evidence of MANMADE global warming. Over and over I remain absolutely unconvinced.
Yesterday, I heard a long term meteorolist on WABC radio who said we have been in a period of glolbal warming for a long time.
Her joke "What ended the ice age"...Global Warming.
Heard about the tainted U.N. piece that borrowed and absolutely misquoted from a "magazine". I never could see how a few parts per million could change the planet. It might but I wouldn't be 100% suprised if in 30 years the planet were cooler.
I have looked at different charts and weather patterns. What is clear is we are in one of the warmer periods in history but we have been there before. What is also clear is that a 10 or 19 year chart of weather (which many global warming advocates use is not adequate to tell the history of the world).
I ask two questions (one of which I asked twice now without a single response):
1. Last summer I went on a cruise to Glacier Bay in Alaska and the park ranger who spoke to the cruise said where we were cruising in the middle of the bay would have been under a mile of ice 300 years ago. That was before the automobile, so explain that?
2. WHERE is your data coming from that makes you so sure.
My last point is that I do hope you are wrong about man made global warming exacerbating the natural warming cycle because I don't expect any international agreement on this (China in particular is focused on it's own development not on world issues)(However, technological breakthoughs may still greatly reduce pollution, even in the absence of international agreement).
Were your previous questions also posted in a stale drumbeat?
A single glacier proves nothing.
Here
Here
Here
Here
And the biggie 387.27