Gulf Oil Spill: With so many oil resources, can't we just drill somewhere else?
Posted by Gail the Actuary on May 29, 2010 - 7:00pm
This post is an adaptation of one posted in December 2009, relating to a talk given at that time. A PDF of the talk can be found here.
There is a huge amount of oil which theoretically can be extracted. The question isn't whether it is there--the question is whether the cost to extract the oil will be cheap enough for us to be able to afford the oil. If oil is too expensive, the high prices seem to cause a recession, similar to what we recently have been experiencing.
In many ways, people who say we have lots of oil are correct. All one has to do is include the oil which is extremely expensive and slow to extract. Much of the cheap, easy-to-extract oil has already been removed.
Economic theory talks about oil prices rising, and substitutes being found, which will tend to bring prices back down. When oil prices rose, we found substitutes, but they were poor substitutes-- generally more expensive, and hard to scale up. Corn ethanol requires huge land use and imported fertilizers. Wind isn't a transportation fuel--it is a substitute for natural gas and coal in electricity production. Making sufficient electric cars and trucks to replace our current fleet would be a huge expensive project, requiring many years, at best.
In the above slide, I purposely exaggerated the impact of an oil price rise on food and gasoline. The effect would be greatest on a low income individual. It would also be very great, if the price rise were to something like $400 barrel.
This is pretty obvious, if you think about it. Does it sound like anything we have run into in the last few years?
Many people think of the effects of peak oil as a future event. But we are really experiencing them here and now. Oil production stopped rising in 2005, so by 2006, we were feeling the effects of the squeeze. The effects were being felt as early as 2004, when oil prices began to rise.
The US was the earliest place where drilling for oil, and the earliest place where production began to decline, in spite of technological improvements and increased drilling. But fortunately, when oil begin declining in 1970 there were other places that were not too hard to reach.
After the US 48 states production began to decline, production was ramped up in a number of places, including Alaska, shown here. It production began to decline only a few years later.
The North Sea was another place where production was ramped up after US production began to decline. It too began to decline rather quickly. I didn't show Mexico, but it was another nearby location that was ramped up, but then began to decline, after US 48 states production began to decline.
At this point, most of the fields that are in easy to access locations are in decline, and we are "stuck" with what is left--the slow to extract, expensive oil from difficult locations. Deep water oil is one of the kinds of oil we have left, but it is expensive to extract, and, as we have just seen, if there are oil spills, they can be very difficult to stop.
So many people have equated high prices with oil shortages, that people have come to believe that if prices are low (or at least relatively low, compared to recent past prices), everything is OK. But we really need lots of quite inexpensive oil to fuel the economy, or it goes into a recession. Reduced credit reduces demand, and has the effect of bringing oil prices down.
In the above slide, the cutback in credit is especially important. Without credit, many people cannot buy new cars, new houses, or expensive Christmas presents. All of these use oil in their manufacture and distribution, and keep oil prices up.
US consumer credit (including things like credit card loans and auto loans) peaked the same month as oil prices. Mortgage loans peaked about the same time, and many types of commercial credit have been affected. The government has tried to pick up the slack with additional borrowing, but this is not the same.
The EIA indicates that on a constant dollar basis, energy expenditures more than doubled between 1990 and 2008. Going forward, the EIA sees more increases in energy expenditures, on an inflation adjusted basis.
I might mention that one of the major uses of new technology is to bring down prices. There are limits to what can be done--if oil is very deep in the ocean, it is likely never going to be cheap to extract. The need for new technology to bring down prices is probably as great or greater with fossil fuels as it is with things like wind, solar, and biofuels. Fossil fuels are at least well adapted to running our current infrastructure. Anything that is very different will require huge expenditures for conversion.
In my view, the big question is how debt (and financial institutions holding the debt) will fare. The front page story on today's Atlanta Journal Constitution is "Troubled banks find it hard to stay afloat". How long will bailing out failing banks with printed money work?
The growing gap is the concern. Regardless of whether oil production remains flat, or declines fairly steeply, we have a major problem. With many people from around the world interested in using oil products, and many new cars in places like China and India, the gap between production and what we would normally consume (if prices were low and credit were available) is likely to continue to grow, even if somehow oil production could be kept flat. If we intentionally decrease deep water drilling, it will tend to make the gap worse.
The advanced economies have in the recent past been able to "offshore" their energy intensive industries to places like China, giving the illusion that countries can get along with only non-energy intensive services like finance. But for the world as a whole, there seems to be a close relationship between growth in oil consumption and GDP growth. Since finance and some other services don't need much oil to grow, the relationship is not exactly 1:1. Efficiency growth would also tend to make GDP growth higher (but declining energy return on investment would tend to lower it).
My big concern is international trade. If debt defaults are a problem, this could interfere with the workings of the whole system, especially if it leads to major countries (perhaps Greece) defaulting on their debts.
In the years since fossil fuel use has developed, world population has greatly expanded.
We are already seeing problems with people in some of the poorer nations having adequate food. Even in the US, there are people at the margins who are "food insecure". Currently, there are government programs to help, but states are finding it increasingly necessary to cut back, because of falling tax revenue.
It would be a lot easier to get politicians to talk about the situation if there were a good solution in sight. There are some partial mitigations, but they likely don't get us back to "business as usual". Voters are likely to be very unreceptive to such news.
We are in the midst of a predicament, even if we continue to ramp up deep water oil from the Gulf of Mexico. If there is less oil from the Gulf of Mexico, it will make our predicament even worse.
The world doesn't really have many more good, cheap places to drill any more. Any place we do drill, requires substantial capital investment and long lead times. Much of the remaining oil is in solid form, like the oil sands, and oil shale. Such resources will be very slow to extract, so it is very difficult to ramp them up, even if we decided we wanted to. There may be other limiting resources as well, such as water, meaning that this obstacle needs to be overcome as well. So there are no easy substitutes for oil from the Gulf of Mexico.
Gulf Oil Spill: With so many oil resources, can't we just drill somewhere else?
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Gulf Oil Spill: With so many oil resources, can't we just drill somewhere else?
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Wow....all that I can say is wow. Actually, the phrase "Game over" comes to mind. Honestly, as I reflect on everything, I see that this is a massive reset button, sending humanity back to the stone age.
I hope I'm wrong.
Madcv welcome to the doomer club :) Richard Duncan is the high prophet of doomers, predicting the end of industrial civilization by 2030. http://www.warsocialism.com/duncan_tscq_07.pdf see the chart on page 13 of his paper on his theory. He bases it on Energy per Capita rather than total energy available.
While it is a very human sentiment to hope this is wrong, the rest of life on the planet were they able to hope would no doubt hope you are right.
The problem with that is that he goes for an all or nothing approach. I think we'll rather see the range of industrial civilization contract. Geographically remote areas will be left to their own devices (if they don't have oil): parts of Africa, central Asia (basically colonization in the reverse). Socially some consumer products (in particular those made of cheap plastic, and the more energy-intensive toys) will fall out of reach of first the lower classes, then the lower middle class and so on.
Wars will break out over the remaining resources, but barring a global atomic war, that will mostly damage the control apparatus of the central powers, so they have less clout to make the remote areas march in sync with the tunes that are played in the center of the economy.
You're wrong, and so is this guy.
Some perspective- prior to the late 1800s, most everyone on the planet lived in poverty (except a few royalty). Industrialization and private property rights fostered investment, innovation, and a consumption boom (except where backward economic policies prevented this- and that is quickly being rectified in China, Eastern Europe, and parts of South America).
Now, more steel is recycled from cars than is used to build them. Skyscrapers, reservoirs, HVDC lines, GM seed, are doing for their sectors what the internet has done for information- slash cost and improve access. If the Ukraine (not to mention the unused 80% of arable land in Africa) adopts modern farming practices, we will be awash in food, only limited by transportation and political will to trade freely.
As our economy develops, less time is spent fighting dinosaurs, cobbling together iron tools, and growing food, more time is spent creating entertainment, traveling, and finding ways to improve our lives (next politician that says we're generating too much GDP in healthcare, ask him what he'd rather have it be in- lotto tickets?). This includes the world's wealthiest like Buffet and Gates giving their money to organizations helping the world's most poor. Progress indeed.
So all we need to know is where to get the energy to power it all. No doubt you've heard a 100 mile x 100 mile chunk of Nevada is all we need for that (assuming these plans aren't stopped because some lizards could die). And we're not running out of sand/silicon any time soon. HVDC can transmit power thousands of miles.
And this doesn't even include 4th generation nuclear. If you haven't looked into that you have no right to panic, or incite others to panic.
The only question is how the transition from fossil fuels to new fuels is to be handled. Jimmy Carter's proposed way- which would have used technology 300X less efficient than today's? Or letting the market determine when the price/benefit ratio is there? Coal at 2 cents/kwh vs. wind at 7 (or 25?), I guess we'll have to wait for CERN to publish their CLOUD experiment results later this year to answer that one for sure, but I'm pretty comfortable that the world will not end if we have to deal with $100/barrel oil for a couple decades while building out the infrastructure that will continue (CONTINUE!) the decline in electricity prices (like other commodities whose prices also fell). BTW, these declines occurred while free trade, lower taxes, less regulation, less subsidies for demand, etc. circled the world and lifted a billion people out of poverty AT THE SAME TIME as population was booming. And I assume you are aware that more developed countries have lower birth rates, so the population is expected to stabilize in the next 50 years.
One last thing- the recession wasn't caused by higher gas prices. People weren't near as worried about spending an extra $100 a month on their gasoline (offset by lower electricity and gas prices, don't forget) as they were paying an extra $1000 on their adjustable rate mortgage, or covering the additional debt service- and increased profits required to meet loan covenants- on their business revolvers. When the Fed inverts the yield curve, the result is always recession. And you'll note the recession didn't slow when oil fell from $140/barrel to $40...
Dirk, I see you are relatively new here. You articulate very well many of the usual arguments that are brought up by people who are optimistic that there will be a relatively smooth transition from Peak Oil to Post Oil.
What you probably don't know as a new comer here is that each of your fine points has been discussed in great detail in these forums over the year--I'd estimate millions of words devoted to each, with many millions more referenced in articles (a practice that has unfortunately become more rare on these threads of late).
And much of these discussions is by people in the field, people with long training and education in the relevant areas, and other very smart people who have become well versed in the details or are involved in policy decision locally or nationally.
Through this process most regular contributors have come to the conclusion that most of your points are not valid, in part or in whole.
I know that that is not very satisfactory as a counter argument, but you might try doing some searches on this site on some of the topics you mentioned. It is an amazing education, and often fun, though also often quite sobering/depressing.
Just to make one point for now--even if we had some techno-magic, carbon-neutral, environmentally friendly cheap energy source, what would we use it for? History would suggest that we would use it to continue our enormously and ever-increasingly consumptive lifestyles, lifestyles that have already driven a third of the rest of the life on the planet to or over the brink of extinction.
Given this history, do we really deserve some vast new source of power to continue this wonderful track record? Is that really a good idea?
Anyway, welcome to the fray, and thanks for at least being quite articulate.
More later,
dohboi
There's an interesting philosophical question here. I think the simplest way to ask it is to ask:
"How much energy did the Roman Empire have at its disposal?"
Pretty much all the Roman Empire's energy came from food which was "burned" in animals and humans. But, they certainly sat on amazing amounts of coal, oil, and gas. Would you count that too?
From a historical point of view, you wouldn't. They didn't know about steam power or internal combustion, or at least they didn't know how to do it at any scale. (I think a few philosophers may have played with steam toys...)
So the question is: to what extent is our available energy related to our knowledge?
There is almost infinitely more energy in the world's uranium and thorium reserves than there ever was in fossil fuels, but our use of fissile materials is really still pretty low-tech and expensive. What if we made some discovery that made it really cheap and easy (and safe) to use fissile fuel?
There is infinitely even more energy in the world's water reserves in the form of hydrogen, which can produce great amounts of energy through fusion. We know this from the sun and from H-bombs, but we presently have no idea how to harness that energy productively. On the surface it looks promising, but if you scratch the surface you find out it's actually quite far away. Barring some breakthrough, I don't expect to see more than maybe one barely-break-even demonstration scale fusion plant in my lifetime.
Then there's solar energy. If we knew how to make solar panels cheaply enough and/or how to store or transmit energy efficiently enough, we would have all the energy we'd need from the sun.
The hard-core "doomer" crowd likes to treat carrying capacity as a quantity absolutely fixed for all time. It seems to me that that's problematic. Advances in knowledge have led to huge increases in available energy in the past, and it is impossible to know whether such advances lie in the future or not. Knowledge was related to resource availability even before humanity existed... life itself faced a Malthusian catastrophe prior to the evolution of photosynthesis. If microbes could think, there would have been quite a few "doomers" before chlorophyll-like compounds evolved.
On the flip side, the pollyanna crowd likes to assume that a) such advances do lie in our future and b) that they can be counted on. As an engineer, I find this quite dubious... great advances in science and engineering are not something that can be counted on to just happen. They are creative events, much like the emergence of new genres of music or art. They cannot be "bottled" or called into existence on demand. Creativity is fickle, fragile, and serendipitous. The price of a new innovation is infinity or zero, depending on the whim of chaos... to the eternal frustration of economists and tech industry businessmen who want creativity to be a predictable commodity.
(So personally I expect a future somewhere between the doomers and the pollyannas. My personal forecast is for a choke period during which the world will slowly and somewhat painfully transition to post-fossil fuel sources.)
So there you have it. I think that the role of knowledge in resource availability is really the fundamental question. Are we constrained by our resources or our knowledge?
Philosophically I take the view that we are constrained by our knowledge. The universe is full of power and energy, but our knowledge of how to use it is quite limited. BUT this doesn't mean I'm a pollyanna... knowledge takes time, struggle, and... like anything else... energy to acquire. Whether our future is good, mediocre, or apocalyptic depends on some level of chance: do we acquire the knowledge fast enough? are we agile enough? Human beings hate chance, but that's how I think it is.
I think humankind's biggest constraint, is our level of intelligence, which doesn't look to be increasing any time soon.
I believe we are pretty much at the pinnacle of what we are capable of. We don't have the mindpower to make the next breakthrough to a higher magnitude of power production. And even if we happened to stumble across it, we aren't intelligent enough to realize that the Earth is beyond carrying capacity already. More energy = more people which is something we definitely do not need. I see no other option than a die-off, and I believe it will happen eventually; it is inevitable.
More energy does not need to equal more people though. We have the knowledge we just don't have the will power to use it correctly.
We know we can't just pave the earth and get away with it. We know that oil on marshes kills the future. We know that sea life is key to our future. We know all these things but we are to greedy and to selfish to stop ourselves from eating ourselves out of house and home.
We are intelligent enough, just are we wise enough? Wisedom and knowledge are two different things. We are intelligent enough to split the atom, and record our own DNA code. But are we wise enough to use what we know?
We lack wisedom in a lot of the things we do, and going to the great GURU on the mountain top is not going to solve anything if we don't listen to the advice given.
It takes wisedom to listen to the knowledge of someone more wise than yourself.
Charles,
BioWebScape designs for a better fed and housed future.
AdamI,
Welcome to TOD, nice thoughts by the way.
I love chance when I am playing pool. I look for the patterns and learn some things that I did not know before taking a chance and shooting blindly.
Knowledge is something I have been seeking a long time, always asking a question, looking to find what answers show up.
I think some people like chance better than others, being more adapted to riding the flows better than others. Or maybe they see patterns that other people don't see and their split second snapping the ball out of the air is viewed as magic.
While reading you comment I was thinking about free wheeling energy flowing in the system we call our universe. I've been building rainwater catchment systems for several years now, be they old fish tanks to barrels. But what if you have a funnel set up over a cistren, but the water flows over a water turbine in the process of funneling down, and you catch just a bit of energy there whenever it rains. Not a big thing, not scalable but a bit of capture of the energies all around us, in the little things that happen every day.
Some of the biggest storage containers on earth are clouds, just floating by blending in and out as time goes by. Just look at a thunderstorm system moving and dumping rain. Look at the monsoon season as a free river from the sky you can harness the energy from if you build the system right.
Solar energy runs most of this planet, be it directly via sun, or wind (heating and cooling of land mass and water vapor), or water running down hill, (which is the result of heating and cooling again but via clouds), or stored sunlight in plants and fossil fuels.
Oh to be able to build a Dyson Sphere, or even a ring of solar collectors in the Moon-Earth Lagrange points.
Knowledge a wonderful thing, knowing to much and not being able to use it all is such a waste.
Charles,
BioWebScape designs for a better fed and housed future.
"almost infinitely"
I love that cornucopian oxymoron, it's such a gas! Gives me a giggle every time I see it.
Trouble is for the cornucopian mindset (which I see you don't share, Adam) we live on a stubbornly finite planet which is already refusing to accommodate the fantasies of cornucopianism, and which will delete us too, if we can't manage to dump such delusions; unless perhaps we stumble just in time on the means to boldly go.....
Always liked that idea, being a sci-fi fan at heart. But what's the star-drive going to be that gets us access to huge amounts of extra-terrestrial commodities? And meanwhile, what do we do about our key fundamental problem, which has nothing do do with technology at all: that our species is technically clever, but collectively we're ethical and spiritual morons?
No there is not! There is no free hydrogen on earth. Oxidized hydrogen, or water, is not free hydrogen; it is hydrogen that has already given up the energy you would otherwise get from burning it and turning it, and the oxygen, into water.
And fusion, well that plan has been cancelled. Financial meltdown imperils reactor
Fusion has always been billed as the energy source of the future, and always will be. However it looks like the pipe dreamers are now coming face to face with reality. Fusion energy is nothing but a dream and as long as the grant money was there then there were always people willing to take it no matter how slim the chances of success.
Now it is over. Good riddance to a money hole that never had any hope of success anyway.
Ron P.
There is infinitely even more energy in the world's water reserves in the form of hydrogen, which can produce great amounts of energy through fusion. - No there is not! There is no free hydrogen on earth
He's talking nuclear energy, you're talking chemical energy. Nuclear energy is indeed available.
Fusion has always been billed as the energy source of the future, and always will be.
Well, I don't expect to see it in less than 50 years (more likely 80), but there's no fundamental law of physics in the way.
Think long-term.
Yes there is problems of physics getting in the way. That is the only problem getting in the way. There is nothing that can withstand or generate the "center of the sun" pressures and temperatures needed to cause fusion. That is the problem. That is a problem of physics.
Okay, perhaps there is no law of physics that says those pressures and temperatures cannot be generated on earth, but it is impossible nevertheless. But of course grant money spends very well and folks will keep trying and lying as long as the grant money keeps flowing.
Surely you jest. By 2013 we will see the shark's fin of the downside of peak oil. In a decade or so we will have perhaps 50 percent of the available petroleum energy available to us. That will mean the end of the world as we know it but you believe the grant money for fusion research will still be flowing 80 years down the road? Good Lord man, what planet are you living on?
Ron P.
There is nothing that can withstand or generate the "center of the sun" pressures and temperatures needed to cause fusion. That is the problem. That is a problem of physics.
Magnetic containment is perfectly able to withstand such temperatures, and we know how to generate such temperatures. What we have is an engineering problem: how to do all of that while generating a surplus of energy and harvesting it usefully.
Do we know how to do it now, and is there a guarantee we'll figure it out? No, but there's no special reason to think we won't.
As quoted above: Arthur C. Clarke said: "If an eminent expert tells you something can be done he is most probably right. If the same eminent expert tells you something cannot be done, he is most probably wrong."
By 2013 we will see the shark's fin of the downside of peak oil. In a decade or so we will have perhaps 50 percent of the available petroleum energy available to us.
Kjell Aleklett, President of ASPO International: by 2030 production is likely to fall 11 per cent, to just 76 million barrels a day.
http://www.smh.com.au/environment/energy-smart/highly-vulnerable-to-oil-...
Look at page 40 of the presentation: http://www.aspo-australia.org.au/References/Aleklett/20090611%20Sydney4.pdf
This projection is for a .5% annual decline rate over the next 20 years.
On page 42 of the presentation - we see that this projection is precisely in the middle - between the "Standard Case High End" and "Standard Case Low End".
We don't know the actual decline rates until we see them, a few years ago the IEA was saying oil would peak in 2030 at 116 million barrels per day.
We don't know the actual decline rates until we see them
True. A good reason not to make strong claims about imminent "the end of the world as we know it" 1.
a few years ago the IEA was saying oil would peak in 2030 at 116 million barrels per day.
I don't think anyone on TOD has ever relied very much on IEA or EIA projections.
1Unless "the end of the world as we know it" includes a vision of driving EVs and hybrids, and carpooling. Somehow, I don't think that's what Ron meant.
Perhaps much of the "end of the world" discussions comes from individuals with an American perspective who are upset over the decline of the U.S. I think this mindset manifests itself in many ways. However, conditions worldwide do appear to be deteriorating.
the decline of the U.S.
The US isn't declining, except relative to emerging economies like China, which can be expected to grow more quickly.
conditions worldwide do appear to be deteriorating.
World economic growth is continuing, if a little more slowly than before the recent credit crunch. OTOH, species extinctions and CO2 levels continue to rise.
Depends on how you measure things.
The US is in terminal decline. I'd say $56 trillion of debt is pretty far down the decline curve.
Most of that is actuarial projections of Social Security and Medicare. Those aren't fiscal obligations - they can be reduced at will, and they will be.
So the expectations of millions of Americans to decent social security and medical care in their old age have to decline to fit the new fiscal reality? Of course this is fantastic news for the official assemblers of numbers that point to determine the nominal measures of progress or decline. We'll just ignore all the stupid old people and there claims on economy and mak up the numbers to prove our assertions that the US is not in decline! Brilliant! Love your work! When are you running for office?
So the expectations of millions of Americans to decent social security and medical care in their old age have to decline to fit the new fiscal reality?
Not at all. The primary problem here is that people are healthier, so they're living longer. That means that the ratio of retired to employed workers is getting way too high.
The easy solution: later retirement ages, to acknowledge the new reality of better health and greater longevity.
That'll make a lot of younguns just coming into the work force a bit miffed. They pay for the old geezers retiring AND they can't get a job because of old geezers NOT retiring...
On the one hand, it's "OR", not "AND".
OTOH, those geezers are their parents, so the younguns ought to be happy for them...
I'm sure we'll be able to pay for the retirees. Just the other day I read a news article stating that in 2000 18% of the workforce in Texas had no high school diploma or equivalent, in the year 2040 it's expected to be 30%... What could go wrong?
You seem to assume that happy thoughts can solve all problems.
What, specifically, do you disagree with in my comment??
Specifically? This:
Wishful thinking. Who are these "we" that you talk of anyway. Who do you purport to represent?
Who are these "we" that you talk of anyway. Who do you purport to represent?
Society as a whole, and the scientific community working on the problem in particular.
My point? It's a difficult problem, with no guaranteed solution, but there's no justification for saying it's impossible.
dohboi, you describe how The Oil Drum apparently drifted to a wise pessimistic consensus. Maybe it's interesting to know that this does not jibe with the consensus in the professional community that I come from.
I'm also relatively new to TOD (although I follow the peak-oil discussions here sometimes) and have not read the millions of words that you think prove me wrong, but I'm not exactly new to renewable energy. I make my living as a renewable energy consultant and I can assure you that the prevalent opinions I encounter among the most eminent long term visionaries on the energy transition resonate relatively closely with those of Dirk.
Maybe it's because TOD has gathered a crowd of "people in the field with long training and education in relevant area's". These are often the ones that are stuck in the old paradigm. In paradigm changing situations (and the energy transition is one of the biggest) you need fresh talent.
As Arthur C. Clarke said: "If an eminent expert tells you something can be done he is most probably right. If the same eminent expert tells you something cannot be done, he is most probably wrong."
No transatlantic shipping company thought airplanes where any good. No telecom company thought the Internet was a big threat. (Something I've seen firsthand.) And now the incumbent players in the energy market have trouble getting it with regards to post-fossil energy. But the fact of the matter is that renewable energy is getting cheaper quicly (Solar energy is already at grid-parity in parts of California and in South Italy. More than 50% of the world will be at grid parity within 10 years.) while fossil fuel is getting more expensive. People who really delve into this usually conclude that renewable energy will probably end up being cheaper than fossil fuel.
I agree with you that we are using our material and natural resources in an unsustainable way and this has got to change. But we have renewable energy potential in abundance and it will probably be cheaper.
So take heart, all is not lost!
Regards, Auke
1. Nukes
2. AGW
3. Infrastructure
I think we might avoid the unleashing of the Nukes, I think we will not avoid AGW moving into positive feedback
If we are really lucky the electric grids will fail and we will avoid 1 and 2 - while that is full of incredible pain and much death it might just let the human species survive.
Renewable energy all relies on fossil fuels. There is no way enough fossil fuels will be diverted in time to change our whole infrastructure to rely only on renewables.
I've come to prefer the term "global frying" myself. Less about being warmed over, more like being cooked in hot oil, even burnt to a crisp. Now, what happens when you put a lid on your frying pan?
It got up to 95 here in DC yesterday (in case "skeptics" who love anecdotes thought a blizzard here back in February was evidence for their point, rather than evidence of an energized climate). Yeesh, can't wait for August and the "recess." Or maybe we are just burning in the melting pot...
The term "basted" comes to mind.
With our population as it stands now, we depend on fossil fuels, but for much of our history we depended on renewable energy. All we need to do is get ourselves into the mindset that we don't have to pump the energy all over the place to use it.
If you have a renewable source of energy in X place, then build nearby, and use it to power a smaller smarter lifestyle.
In my BioWebScape designs I am trying to do just that. If there is something that we have lost over the years is locally used energy sources and expanding our cities to the point that the areas carrying capacity is swamped.
Smaller cities, more towns, cities planned with passive solar in mind, and rainwater catchment and water reuse a standard item of the design framework. Every window facing the sun is used for plant growth and or room heat in the winter and no heat in the summer. Stacked housing so that the sunward side looks like steps, and the backside is where you live and stay cool easier.
Whoever thought a strip mall on every block was a good idea should have spent some time not making the zoning choices for people. Futurists have been designing working solutions for decades, people just haven't been listening, or the people controlling the purse strings have been ignoring them.
Alan Drake has some great ideas about how to rail the world back from the brink, and others have good ideas about how to replan the world to a better place.
The issue is who is pulling the purse strings still?
And we really don't have to Change the WHOLE ball of wax, we need to start chipping away at the ball of wax and melting it around the edges. Call it core renewal, in the end we need a smaller core.
We have already set in motion a die-off, starts just before the baby-boomer generation, each generation after will tamper off I expect, imo.
It's those patterns on the wall again, someone calls them writing, but all I see is a bunch of pretty wavy lines, looks like flowers in the spring.
Charles,
BioWebScape designs for a better fed and housed future.
Charles, AGW would have been better named Climate Change or even Climate Chaos. I think it is good for you to do what feels right and good. About any design for living would be better than what we have in the US. OTOH all designs rely on a certain amount of climate stability. If we don't stop burning fossil fuels in time then we will have no certainty that the conditions that exist where we live now will be the same in 50 years or even 10 years. The hardest fuel to get in such changed circumstances is food fuel from agriculture. Some predict the South East US will become a desert. Not much room for agriculture there. Hunter-gatherers live in deserts but they have skills and knowledge we don't have and they live in a desert that has been desert for a long time and has stabilized.
Yup..another neewbie...
I think Ace's supply side has taken a few hits since he wrote this.
http://www.theoildrum.com/node/5979
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The Hirsch report, the commonly referred to name for the report Peaking of World Oil Production: Impacts, Mitigation, and Risk Management, was created by request for the US Department of Energy and published in February 2005. It examined the time frame for the occurrence of peak oil, the necessary mitigating actions, and the likely impacts based on the timeliness of those actions.
Three scenarios
Waiting until world oil production peaks before taking crash program action leaves the world with a significant liquid fuel deficit for more than two decades.
Initiating a mitigation crash program 10 years before world oil peaking helps considerably but still leaves a liquid fuels shortfall roughly a decade after the time that oil would have peaked.
Initiating a mitigation crash program 20 years before peaking appears to offer the possibility of avoiding a world liquid fuels shortfall for the forecast period.
http://en.wikipedia.org/wiki/Hirsch_report
Gail, if you have your Peak Primer, this would be a good time to repost it..
Rat
agreed there are probably a lot of people who are new to the discussion around here who could benefit from checking out the basics with the oil spill in the news now. never too late to revisit the fundamentals...
Thanks for declaring your conflict of interest. When the visions materialise into actual results, be sure to drop back here and give us an update.
No, we don't have renewable energy resources in abundance!
First, with a few exceptions, they tend to be more expensive than the fossil fuels they replace. Remember my point about it is the cost of oil that is a problem? How are higher cost fuels going to solve the problem. And the costs really haven't been coming down anywhere enough.
Also, the amounts of the newer renewable energy sources (wind and solar PV) are trivial compared to our total energy use.
Wind is the green line that you can barely see at the top of the graph. Solar PV is part of the very top "other" layer that is all but invisible on this graph.
Nearly all of our energy is from oil, natural gas, coal, nuclear, and hydro-electric. We don't have much ability to ramp up hydro-electric. Coal and nuclear both depend on oil for their production and transport.
The graph shows how total energy use is falling (because of credit constraints/ recession induced by high prices). Renewables have had no impact on this.
Thanks for the welcome, dohboi. I'm sure you know these topics have been discussed extensively outside TOD (though the TOD threads on this oil spill have been superior). I try to present information and logic in leau of emotions and pure speculation, but there's no doubt our worldview/null hypothesis affects our level of optimism or pessimism.
It's said a pessimist is an optimist with experience, but perhaps it's just the wrong kind of experience. My experience is that problems can be addressed many ways, and meanwhile beware those who are funded to find problems(!) instead of solutions.
What I'm most interested in- do you disagree with any of my specifics or history? Or are you saying nuclear won't work- why?
"Or are you saying nuclear won't work- why?"
We know nukes work. The issue is one of scale. How many nukes would we need to build? At what cost. In what time frame? Long term costs (of not kicking the can of waste storage/disposal)? Environmental mitigation costs?
How much wind and solar will be required? What solutions are there to intermittancy problems? How much new distribution must be built (at a time when we have invested little in maintaining our current infrastructure)?
In capital/credit constrained economies, how will this massive build-out be financed (once again, when we can't even maintain what we have)? It's clear we can't "grow" our way out of this.
Have you done this math? We have, many times. Therefore our level of pessimism is significant. Our society's sense of urgency and ability to respond does not match the scale of the problem.
Scale, timeframe, lack of leadership and awareness, economics, cultural bias, greed, inertia, declining resources of all kinds, population, climate change, ecosystems in decline, wars: ---->overshoot.
I would be happy to link you to the many previous posts here regarding this issue, but alas, I have PV arrays to adjust and a load of mulch to spread.
Stick around, Dirk! Optimism always welcome.
One of the big issues with nuclear is that it "only" gives us electricity. This is not a transportation fuel without a whole lot of technology improvements and investment.
There are also serious questions about how much it can be ramped up. For one, it uses oil in its production and transport. For another, the price tends to stay too low to encourage development (similar problem to oil and natural gas recently)--because of the tie in with credit and what people can afford. Huge number of nuclear plants around the world are nearing the end of their useful life. A big replacement effort will be needed, to stay at our current level.
And then there is the little issue of radioactive waste that lasts (from a human perspective) forever.
And radioactive poisoning from mining the stuff.
And radioactive spills from transporting the stuff.
And regular reported and unreported radioactive "releases" throughout the life of the plant.
And the occasionally major disaster (and don't tell me one can never happen again).
And the little problem that the whole damn plant, every bit of it, becomes radioactive waste forever.
And the eentsy weentsy little problem that we are supposedly in the middle of an endless global war with ubiquitous terrorists--any one see any problem here???
I'm more worried about weapons proliferation, ala Iran.
There's nothing like a thermonuclear explosion to ruin your whole day...
Yes indeed. And it becomes ever harder to argue that nukes are just the cats meow for us and our friends, but you countries we decide are naughty can't have a one of them. The hypocrisy just becomes too apparent to everyone.
Thanks for the potted history lesson. You need top go back back to the start of the industrial revolution to get a good grasp of why that happened when it did. In a nutshell it was because of a shortage of wood drove more people to mine coal and when all the easy stuff was picked off the surface they strated to dig. Soon ran in to flooded mines which created the need for mechanical pumps which Newcommen attached to a steam driven engine he invented in 1712. The steam itself was created by burning coal which in turn set of a wonderful feedback loop that allowed for great industrial development. Oil and gas came later and spurred their own peculiar developments such as the internal combustion and gas turbine engines. The technology built on fossil fuel base includes all the hi tech solar and wind and other renewables including bio-fuels.
Renewables are not going to save "business as ususal" and neither is exuberant optimism. What we need is some hard engineering based on the laws of physics which are proving rather resilient to the wishful thinking that the majority of the population cling to. It appears to me that you are in the bargaining stage. Hang in there though, anger is coming next, then despair, then you can join the rest of us who have accepted the reality of the end of the cheap energy age and are preparing for what comes next. There are many positive things we talk about here, community and gardening being hot topics and we also take a hard look at all the alternative energy sources and learn from eachother what their true applications and limitations might be.
Hi Termoil,
Dirk Said:
And you (Termoil) said:
If an overwhelming percent of the people on the planet actually understood the nature of the problem and acted in unison to implement goals and solutions, then Dirk's suggestions might help mitigate the worst consequences of what is going to happen in the remainder of this century. Also, your suggestion of "hard engineering" could prove useful if there was a genuine will to embrace that kind of engineering.
But, I see no evidence that the problems will be recognized accurately; nor the causes of those problems will be properly understood; nor will good solutions be implemented. Effective problem analysis and "hard engineering" depend upon participants being able to comprehend the nature of something called "Truth". If a person has no ability to understand the difference between what is true and what is false, then it is simply a crap shoot in terms of what actions they might take to solve a problem.
The great majority of humans on the planet are mentally crippled and dysfunctional in their ability to discern truth or falsehood. The simple proof of this is the nearly ubiquitous "belief" that there is a supernatural world of gods, spirits, afterlife, heavens, etc. This belief system is implanted at the same time they are learning language and therefore is nearly impossible to dislodge. These nearly universal beliefs in clear falsehoods is the underlying factor in preventing humankind from understanding the real problems, their basic causes and what kind of solutions we need to implement. Certainly, some religious people can exhibit great skill in math and science - they are not crippled in all areas. However, it is the really important issues facing mankind and the planet where they are blind sided. Generally speaking, religious people do not advocate for reducing the number of humans on the planet because they believe that humans have some kind of divine right to occupy every square foot of the planet. They normally do not equate human life with other species because they believe humans have some kind of supernatual factor (like a "soul") that other species are devoid of. Many of these folks believe that the planet's resources were put in place by a supernatural being simply to serve our needs. They frequently blieve that "god will provide" regarding the big issues. Most religions (some exceptions)normally provide no framework or worldview that compels us to curtail our growth and consumption to provide balance and harmony with the rest of the biosphere.
I live in an a generally affluent, conservative, religious community. A major church, with large number of faithful, has a big digital billboard on the main street of our town. The other day they had a digitized message urging folks to come in and "hear the truth" about salvation. Very few of my fellow citizens understand the absurdity of this message.
Hi Dave,
Dirk made a huge assumption in that new fuels exist in sufficient quantity of energy content to enable a transition to them to take place. That is a very big assumption and one that I and many other 'drummers have concluded is an unlikley an implausible scenario post peak.
I agree with everything else you had to say and gather from your post that you reside in a sea of deluded religious absolutism which which it is always going to be pointless arguing with such dimwits. Marx was wrong about alot of things but he nailed releigion pretty well as the opium of the people. But is a godless society really nay better. The Soviets trashed their environment pretty well without God and China is doing the same.
I recently had a reason to reflect on the Eucharist (Holy Communion) of the Catholic Church and wondered what Jesus would think of the bizarre ritual this small ceremony has now become. In my reflections, I somehow came to the conclusion that he was giving a lesson in sustainability. The body (bread)symbolises the Earth which has been anthropomorphised into a concious god. In eating this bread we remember that we too are of the earth. We belong to it. And to it we will all return. Whether god is concious or not, is irrelevant to the message that the Earth is the only home we have ever really known so we had better look after it.
I am not a catholic or a practicing Christian of any denomination, but I have also come to appreciate that religion can be a great comfort to people in hard times. Religious organisation also have played a critical role in governing and influencing people and this power has been abused many, many times, by religions and cults throughout history. So I now tell people that I am a universal philosopher when asked about my religion. I am open to learning the lessons of any religion an expect to fill my the rest of my life with such a pursuit of wisdom. It's better than shopping!
Hi Termoil,
Yes, I agree with you regarding Dirk's assumption - I only meant to imply that there are many "solutions" that might help if the problems were widely understood and there was very broad support for taking appropriate action. Of course, we are far from this level of understanding and commitment to change.
As opposed to Dirk's thinking, I am most impressed by the ideas expressed in the "Plan C" book - but, once again the author's ideas about "curtailment" have a slim chance of being implemented for the same reason: ignorance/denial of the basic problems and the underlying causes.
I appreciate your thoughts about religion and have had many discussions along these same lines. I liked the movie Avatar - if people really, really cannot exist without some kind of "faith", then your "we remember that we too are of the earth" might be a good mantra for a new religious order.
I haven't read Plan C but will put it on my list. I think that there are many alternatives that we can transition to but few of them are new high tech fuels. I hope that we can make enough bio-diesel to keep tractors on the land and generate enough renewable electricity to keep a rail based industry going. But much of the luxury we enjoy is going to disappear in response to economic realities of less available liquid fuels. I went through a period a few years back where I got angry and despaired at the fools whos demand is signalling to manufacturers to waste huge amounts of energy building things like this (not to mention how much oil it will burn up when it is used for its stated purpose):
I do appreciate the beauy and elegance of such a machine and I understand the ego trip that goes with driving it (this is the classic Australian sportscar after all). But it is difficult to live a virtuous life of restraint when all around you are involved in an orgy of sinful indulgence and whose endorphin soaked minds are closed to the possibilty of their drug supply soon coming to an end. I really liked Avatar too particularly the line by Moát addressing Jake and wondering aloud if his "insanity may be cured". I'm now resigned to the fact that much of the insanity of humanity is incurable and just like in the movie, we'll go down fighting to the death to keep it, rather than make a rational decision to transition to life affirming harmony with eachother and our mother Earth. But now I'm off to make my own communion with the Earth, by digging in it, feeding it and planting the new life which will nourish my spirit today and my body in the future.
Dave,
Do you live in the US South? If so, keep in mind that it's a different place from anywhere else in the US, or the OECD. Living with slavery for 200-300 years, and the culture of violent authoritarianism and suppression of education, has left the south culturally rigid.
The South is unlike anywhere else.
My experience reading and occasionally posting comments here for years is that the most pessimistic readers post more comments than the less pessimistic.
I'd like to see a poll done here on peoples' attitudes about Peak Oil and the longer term effects. I'd like to know, for example, what percentage of the readership expects:
1) Large parts of the US electric power grid to come down? I personally expect the grid to stay up.
2) The Web to come down? I expect it to stay up.
3) It to be impossible to do maintenance on wind mills, nukes, and other key pieces of electric-power generating infrastructure?
4) Hunger reduce the US population?
5) Hunger reduce the world population? Or at least substantially slow its growth?
I think there's a pretty decent chance of a big dip in world food production.
The larger problem is self-selection: sensible people like Stuart Staniford leave ( http://earlywarn.blogspot.com/ ).
I think there's a pretty decent chance of a big dip in world food production.
There's no question that PO will hurt poorer areas, and CC will hurt food production in many places. OTOH, there is quite a lot of potential for increases in other places, and the world consumes substantially more calories than it needs on average.
4) Hunger reduce the US population?
Highly unlikely. The US could reduce calorie consumption by 30%, and actually be healthier. There's no plausible way US food production would fall as much as would be needed to cause a 1% death rate from hunger (that's roughly the growth rate we're seeing in the US at the moment).
It's not just about calories. Nutrition plays an important role in overall health and we can clearly see that quality is just as important as quantity. You really need both but there are already many in the US and other industrialised nations that are getting plenty of calories but bugger all nutrition and that is actually shortening their lives. Post PO their is a hi risk that even larger proportions of western populations are going to have to live on cheaper foods. Growing your own may not be cheaper yet, but I expect it will become cheaper relative to trucked in food in the near to medium term. The big unknown is whether the masses choose gardening over rioting.
It's not just about calories. Nutrition plays an important role in overall health
True.
quality is just as important as quantity.
The average American gets more than enough protein and fat, as well.
lready many in the US and other industrialised nations that are getting plenty of calories but bugger all nutrition and that is actually shortening their lives.
I'd say it's the excess calories and fat that are doing them in, mainly. Sure, more vitamins and minerals would do them some good, but no one is going to put Vitamin D or selenium deficiency on a death certificate.
You don't really need a new poll and they hardly count as qualitative reserach anyway, particularly as you seem to have already made up your mind about the results. Even if you were to find that most people on TOD are doomers, what does that prove? Who are you comparing them against, the average couch potato with average reading ability? So what? Unless you also want to test the subjects depth of knowledge on the role of energy in society, the results would be meaningless.
Rather than a poll you could do a study of the exisitng body of commnets on TOD and come up with some stats that I'm sure could be massaged to reflect your POV, be it doomer or cornucopian. But how do you discern all the commenters who see having less oil as a great opportunity? How do you categorise those who see massive dieoff and corporate collapse as a good thing?
You seem to assume that less oil consumption equals massive dieoff and corporate collapse.
I'd say that the 25% decline in US oil imports in the last 2 years has made it stronger and more stable.
No. You seem to have misread what was written.
Ah - my mistake. The rest of your comments have seemed pretty pessimistic.
Nope- No Mistake. It's not about my comments - or yours for that matter - this sub-thread is about how you would design a poll of TODérs and what it would tell you. You seem to be confusing optimism and pessimism with fundamentalism and scepticism.
this sub-thread is about how you would design a poll of TODérs
Yes, indeed. That's what you meant to talk about, not larger issues, and I'm fine with that.
You seem to be confusing optimism and pessimism with fundamentalism and scepticism.
No, we just disagree. For instance, I've looked at Peak Oil and Climate Change, each one for the facts, and come to different conclusions: I see Peak Oil as a serious problem, but far from apocalyptic. On the other hand, I see Climate Change as potentially catastrophic.
I try to go by the facts, as best I can find them. I try to avoid personal comments - I made one that might appear so here, to explain why I misinterpreted your earlier comment. Again, my mistake.
The doomers have indeed tried to "educate" the more sane heads with the "End is nigh" BS for years. Considering this place is from doomers to doomers it's not actually surprising. The voice of reason which is occasionally displayed here is drown under the collectively accepted mantra.
Amen!
The problem with food production is going to be water, that will be the first and foremost concern. "Water, Water everywhere and not a drop to drink", comes to mind when I think about the uses of water in this world.
Our problem is that megacities have been expanding the use of water from rivers to the point that some of them are running dry before they reach the ocean. That lakes are drying up, that ground water levels are going down and people are wasting tap water left and right.
Arable land is land that gets just the right amount of rain, not too much and not too little. Rainforests are not considered arable land because of the amount of rain they normally get.
If you clear cut a rainforest, you get to use the land a few years and then it becomes wasteland, that is not a viable option.
Africa is not awash in good arable land, but some of it's borderline non-arable land can be reabilitated.
http://www.youtube.com/watch?v=xzTHjlueqFI
Shows how some people got a section of desert to bloom again. Via a permaculture form of making old new again, somethings can be fixed, but you still need to work at it.
There are a lot of things we could do, and a lot of things we should cut out of our lives. Waste is one thing that people should be taught about from an early age and it should be taught in schools the world over, even though in most places of the world, waste not want not is the norm.
I am not as sure that everything we could do will be done, but I don't think we'll be totally goners either.
Oh and if you have a lot of solar arrays in a sandy place, look to do a lot of dusting to keep them clean.
Charles,
BioWebScape designs for a better fed and housed future.
Dirk,
I like your optimism about the potential for solar and advanced nuclear power, but the time is running short to get moving and build such capability out. I know such a strategy would not be an easy/cheap/panacea, but I would rather not give up...not on BAU, mind you...we need to concurrently power down through greater efficiency and doing less with less...but I don't want to give up entirely and go back to the medieval age.
In light of your advocacy statements about advanced nuclear and solar power, I was a little baffled by your advocacy in your same post to 'let the market decide' and your seeming championing of 2 cent per KWh coal electricity vs. higher-cost wind electricity etc. Mind you that advanced nuclear and solar technology is presently even more expensive than wind-generated trons. If we want to ramp up solar and wind and advanced nuke generation then we need to bite the bullet and subsidize them, at least for many years...keep in mind that FFs have received enormous subsidies..
You may wish to re-think the idea of converting all or a a great deal of the remaining arable land in Africa to agriculture...Africa's people need to strictly control their birth rate first, rather than rushing headlong to denuding their soils, creating their own river dead zones, drastically lowering their water tables and poising themselves and other life with herbicides, fungicides, pesticides, etc...as well as driving a great many more species to extinction.
I agree with your sentiments about not going quietly into the night, but after further study you may come to the understanding that your advocacy here was unwarranted cornucopia-ism.
Do you have a link for that?
LINK
And regarding someone's comment on the Ukraine and Russia:
Russian land boom could avert global famine
The fossil fuel inputs into something like this would be massive.
Perhaps. However, there is no shortage of fossil fuels in Russia and Africa.
Africans would have to buy the fossil fuels and tractors, it's not as if they'd be handed to them so they could make as many Africans as they wanted. Other countries want those fossil fuels too such as China and India, and they can pay for them quite handsomely.
Farm tractors can be electric, or hybrid . Here's a light electric tractor . Batteries can be trucked to the field in swappable packs. Farm tractors are a fleet application, so they're not subject to the same limitations as cars and other light road vehicles(i.e., the need for small, light batteries and a charging network). Providing swap-in batteries is much easier and more practical. Zinc-air fuel cells can just be refuelled. Many sources of power are within the weight parameters to power modern farm tractors, including lithium-ion, Zebra batteries, ZAFC's and the latest lead-acid from Firefly Energy, and others.
Most US farmers are small and suffering, but most farm acreage is being managed by large organizations, and is much more profitable - an African transition to large-scale farming might be needed. Such operations will just raise their food prices, and out-bid personal transportation (commuters and leisure travel) for fuel, so they'll do just fine. As farm commodities are only a small %of the final price of food, it won't make much difference to food prices. The distribution system, too, will outbid personal transportation for fuel. Given that overall liquid fuel supplies are likely to only decline 20% in the next 20 years, that gives plenty of time for a transition.
Diesel farm tractors can run on vegetable oil , with a few modifications, and any farmer who can't make the modifications is possibly under-qualified to be in the farming business.
China manages to feed four times as many people as the U.S. using less farmland. The real constraint is fuel to deliver the produce to the consumers. I wouldn't worry about starving to death in the U.S. unless the transportation system fails. People in Africa may starve to death, but that will be from social disorganization, not lack of farmland. Africa has lots of potential farmland.
"China manages to feed four times as many people as the U.S. using less farmland. The real constraint is fuel to deliver the produce to the consumers."
Thank you for stating this so clearly. It is a crucial point that most seem to miss.
Except that it takes relatively little fuel to do that even now, and it could go by rail to reduce fuel consumption by 2/3, or electric rail to eliminate fuel entirely.
A bit hard to connect every farm to an electric rail, I'd say.
I'm not saying it's an entirely insoluble problem, just that getting food to food consumers has been a major problem throughout history. It was mostly solved by having most of your population live in the country where the food is. But today, over half the people in the world live in cities, and much higher percentages in most 'advanced' countries.
Those electric rail lines have not been built, and I have seen not plans for such for food transport anywhere.
A bit hard to connect every farm to an electric rail, I'd say.
You don't have to. In the era of horses and rail, you simply ran rail to small towns, and the farmers came to a central point. Now, of course, farmers using bio-diesel could go much farther, and the rail wouldn't have to be built out nearly as far.
Those electric rail lines have not been built, and I have seen not plans for such for food transport anywhere.
You should talk to Alan Drake. In the short term, a lot of food goes by diesel rail in the US, and that can be expanded. Diesel rail uses about 1/3 as much fuel as trucks, and that we'll enough oil for quite some time for the very small amount that diesel rail food hauling would require. In the long term, a lot of rail is electrified elsewhere in the world. It's not that hard to do, we just haven't seen the need for it in the US (not to mention that it raises property taxes for the railrooad, currently).
Hi Nick,
I always read your comments as you seem to do your homework and, of course, have a much more optimistic POV than most TOD predictions. However, I think this is the nub of your thinking:
The main reason I hang out on TOD is that I have not yet formulated a "most likely" scenario for the next 20 years. However, I lean towards a viewpoint that is less optimistic than yours - but, I'm generally optimistic by nature and would like to be more positive about the next 20 years. So, I have a few questions:
1. Why is it that so many other folks see a much greater decline than 20% in 20 yrs? Are they really credible sources that support this prediction based upon a field by field analysis of decline rates, proven reserves, etc?
2. Given that another billion or so folks will join us over the next 20 years and countries like China and India will most certainly be consuming more oil - how does a 20 percent global decrease translate to the gas pump in the USA?
3. When you mention "plenty of time for a transition" how do you forsee this transition actually playing out? The DOE has said we need a 20 year head start to mitigate serious consequences of PO. I see almost no evidence of widespread planning for PO and a 20% decline over the next 20 years?
4. How do you believe the debt issue will play into any attempt to fund a transition strategy?
I coull probably think of a few more issues that trouble me - but this is a good start. Hope you are still reading this thread. Thanks.
Thanks for asking. As you know, these are complex questions. You might want to visit my web site - it's completely non-commercial, and designed to answer questions like this: http://energyfaq.blogspot.com/
Why is it that so many other folks see a much greater decline than 20% in 20 yrs? Are they really credible sources that support this prediction based upon a field by field analysis of decline rates, proven reserves, etc?
First, please note the difference in Aleklett's projections between conventional oil and all liquids. Aleklett's projections for conventional oil are fairly similar to the kind of projections which we have become accustomed to seeing on TOD. Now, projections for conventional oil are a useful start for analysis, but you have to look at the whole picture. PO is a liquid fuels problems, so you have to look at all liquids.
Given that another billion or so folks will join us over the next 20 years and countries like China and India will most certainly be consuming more oil - how does a 20 percent global decrease translate to the gas pump in the USA?
It will certainly keep oil prices high, putting some downward pressure on the economies of oil importers. OTOH, China (whose growth is much larger than that of India) recently eliminated price controls for gasoline. The next likely step is to do the same for natural gas, which is a natural substitute for oil, but which is underutilized in China due to old price controls which suppressed production. These changes mean Chinese consumers are exposed to the same market prices as the rest of the world - they'll continue to use electric bikes )whose sales outnumber ICE vehicles 3:1). The Chinese government is making EVs a very large national priority, just as they're doing with wind 1, which means they're trying to leapfrog the US's experience with ICE vehicles and go directly to EVs.
"China has taken significant steps in the past five years. It removed subsidies for motor fuel, which now costs more than it does in the United States; its fuel-efficiency standard for new urban vehicles is 36.7 miles per gallon, a level the United States will not reach for seven years. It has set high efficiency standards for new coal plants; the United States has none. It has set new energy-efficiency standards for buildings. It has targeted its 1,000 top emitters of greenhouse gases to boost energy efficiency by 20 percent. And it has shut down many older, inefficient industrial boilers and power plants. "
source
The concern is often heard that growing oil consumption in China will necessarily cause demand for oil to skyrocket, regardless of supply or pricing, such that other countries will be forced to settle for a smaller share of the oil production pie. So, what does the Chinese history of oil consumption tell us?
Average oil consumption in China in 2007 was 7.29 million b/d. In 2008, when oil prices peaked, Chinese consumption fell to 6.92 b/d. When prices fell again in 2009, consumption rose to 7.84 b/d. Source: http://www.peakoil.nl/wp-content/uploads/2009/10/2009_October_Oilwatch_M...
So, we see that Chinese oil demand does indeed respond to supply and demand.
Automobile sales in China in August 2008 shrank 6.3% year on year to 629,000 units, the first fall in about two years, due to higher fuel prices.
Chinese GDP growth has dropped by about 1/3 recently - see http://www.econbrowser.com/archives/2008/10/middle_kingdom.html .
Chinese are much more aggressive than the US about replacement of oil-based electrical generation with coal and nuclear; energy efficiency (especially automotive); and PHEVs/EV's.
China, already a global center for lithium-ion battery component production and battery manufacturing, is ramping up its research and development efforts in the field, both within the private sector and with government support.
Meanwhile, OECD imports are falling. The US started reducing it's oil imports even before this credit crunch hit. US imports have fallen 25% in the last 2 years, making room for developing nations. Regarding competing with China for imported oil: the US produces at least 40% of it's own oil, so a 20% reduction of overall consumption is a 33% reduction in imports.
A dynamic set of responses by oil consumers will put a cap on oil prices - I would estimate oil prices will stay below $125 in current dollars.
When you mention "plenty of time for a transition" how do you forsee this transition actually playing out? The DOE has said we need a 20 year head start to mitigate serious consequences of PO. I see almost no evidence of widespread planning for PO and a 20% decline over the next 20 years?
First, that wasn't the DOE, it was a study by Hirsch, paid for by the DOE. The DOE doesn't endorse it's conclusions.
2nd, the study was badly flawed by it's assumption that liquid fuels had to be replaced. It didn't consider EVs at all.
3rd, a transition has indeed begun. It started roughly in 1994, when the Clinton administration started the PNGV program, which led fairly directly to the Prius. Now, a new generation of EVs has been developed, and are coming out in 2010. We could ramp up the Volt and the Leaf to very large numbers in 10 years.
How do you believe the debt issue will play into any attempt to fund a transition strategy?
I'm not sure. A few thoughts: US debt is often exaggerated by including Medicare and Social Security programs, which are not pension obligations or debts, but simple income transfers and benefit programs which can be cut back at any time. Also, Stoneleigh's forecasts have proven inaccurate. She did predict the recession, but "permabears" will always be right occasionally.
There seems to be a recurring logical error which comes from an single incorrect intuition about the importance of oil. From my readings (which I think are sufficiently thorough), both Gail and Stoneleigh assume that oil is irreplaceable & therefore PO is catastrophic. I believe there is the same assumption behind their analysis of the feedbacks from economy to investment in renewable energy & electric transport.
1. COPENHAGEN (Reuters) - China became the No. 1 wind turbine market in 2009, installing a record 13.75 gigawatts (GW) of new capacity, and three Chinese suppliers ranked among the Top-10 turbine manufacturers, Danish consultants BTM said.
"The most significant trend in the market was the booming Chinese wind industry," BTM Consult said in a summary of its annual wind power market review for paying subscribers.
http://in.reuters.com/article/businessNews/idINIndia-47290720100329?rpc=...
You wrote: not to mention the unused 80% of arable land in Africa.
You were asked the question: Do you have a link for that?
You replied with a link that stated: Out of the total land area in Africa, only a fraction is used for arable land.
You should be embarrassed with that answer. Arable land is not all land. Arable land is land ready for plowing. Africa is using ALL its arable land.
Land that is not used for arable land is used for something else. It is used for forest for animals to dwell in. It is used for savanna for wildebeest, antelope, zebra and other grazing animals to live and the predators such as the cheetah, lion and hyena to live.
I might have known that some cornucopian would come up with the solution that if we just cut down all the jungle and planted it in beans and corn we could easily feed all Africa.
Ron P.
Did you even read the passage beyond the first sentence? It appears you did not. Maybe if I post it yet again it will sink in:
They did not simply take *all* land and declare it to be arable, they developed a set of criteria by which soil could be cultivated, and using that set of criteria, they determined that X amount of land could be cultivated that currently isn't.
I'm afriad you have made a fool of yourself. You do not even know the definition of "arable." You are confusing it with "cultivated." Not all the arable land in Africa is currently cultivated. Perhaps you need a definition:
I might have known that a doomer/tree-hugger such as yourself would change a definition to suit his purposes. You are going to have to get used to the concept of us Cornucopians being right, and decades will pass without your dieoff or whatever it is you hope for coming to pass, and you will get more and more frustrated and become more and more visceral in your attacks on people like me. You heard it here first.
I think Ron is concerned about the conversion of wild habitat in grasslands to cultivation.
I am too, but I have no doubt that it will happen if needed. Which means that our problem is not Peak Food, it's Peak Species.
That is the most absurd thing I have read in years. The arable land in Africa is now mostly a dusty desert.
Millions face hunger in arid belt of Africa
Millions are starving in Africa, in Haiti and in Asia. They are starving because the land has been denuded and will produce almost nothing. Modern farming practices? What would that be. Where are they going to get the tractors and other modern farming equipment, the fertilizer, the pesticides and the seeds. The Sahel is becoming just another part of the Sahara Desert and that desert is moving south by miles per year.
That is all because the land is already being overgrazed and over plowed and planted. The crops dry up and the cattle starve, along with the people.
And then there is Nevada. Just add lots of water. Oh. And the Amazonian rainforest. What a waste. Bunch of wasteful, water and carbon sucking trees. Worthless monkies.
And what about all those national parks. Now there is a waste. Damn fish drinking my water and wolves eating my elk.
Every "solution" is met with a response. More population.
I will, say, however, what about all these worthless lawns around me.
Even if we could support our current and future population, I wouldn't want to. When I go hiking along the ocean or into the forest, I am not seeking companionship with people.
Begin depaving now.
I am a vegan but I don't support the idea of everyone becoming a vegan so we can support more people. We would just ramp up the whole deal to a deeper level of misery. Better than everyone chow down with bacon burgers. Helps to cut the surplus population.
Perhaps it bears repeating:
LINK
And regarding the Ukraine and Russia:
Russian land boom could avert global famine
Regarding the Sahel, it is no longer getting dryer:
But perhaps they are having another drought this year.
Your link is dated over three years ago, February 2007. My link is dated two days ago. The Sahel is still getting dryer. People are still starving in the Sahel.
North Africa is being turned into a complete desert because of too many people plowing too many acres. And you wish to increase the plowed area. Such a plan would turn the rest of Africa into a desert. Typical cornucopian solution.
Ron P.
I think I have figured out the problem here. Perhaps all arable land is not created equal. I assume that the best 20% of arable land is what has been used, and following the Pareto principle, this would mean that 80% of the yield (or sum such majority) has already been realized.
Have you carefully read the references provided?
Welcome to TOD madcv, I saw your introduction post a while ago.
But the world did okay for the while before Oil and even a bit well before Coal was a major player. What you will see though is a lessening of population.
While on one hand you could say that we couldn't feed everyone, we could if we got started on a world wide project of making good use of the arable land (Land that gets good rainfall) and tied into the down slope of Oil production, with helping everyone step down off the high use horse.
The problems will be getting the cooperation needed and getting everyone to use less of the things that they have become used to using.
I am not a doomer, I am a gloomer, I see the doom ahead if no one works at stopping the fall, but see the sunshine if people will work more for the benifit of others rather then a me first attitude.
I'll point out that I help several people with things, that at this time my income which is low, can help them. It is not totally supporting them, but a helping hand, though we don't live in a commune or something like that. If I had more money I'd buy a big hunk of land and have them all join me on it, that would work. But none of us have the credit or the funds to do something like that.
I keep seeing all these vacant lots and think of all the uses they could be put too, if only the US had a bit of a different system of ownership set up.
I don't think we'll head to the stone age, we still have to many machanically minded people, even if they are classed as uneducated, they have street smarts that school does not teach you.
Madcv, I know you listed yourself as being in an apartment, could you grow anything in containers in your windows? Can you use less water, or less electricity? Could you find a community garden somewhere to help out at growing things? I know what it is like to live very close to the edge, I have a lot of friends who are living on less than I do, my income is under $9,000(us) per year.
But I live with my parents, and the house is paid for, so even if they were not here, I'd be okay, though I'd have less to help others with, I could get by.
Life will be different, and it might get ugly for a while, but when the dust settles, the folks that are left will be better off than stoneage man.
Charles,
BioWebScape designs for a better fed and housed future.
Unfortunately, I'm not sure the comunity gardening concept exists anywhere close to where I live. But I'm sure in rural areas there is "teamwork" and cooperation for daily agriculture tasks.
I'm trying to change the income situation. I live with my girlfriend (in denial on the PO issue, but very supportive none the less) who is currently unemployed. We've be thinking about going to luxembourg for a couple of years and try to save up.
In the mean time I'm trying to learn as much as I can (survival, gardening, basic first aid etc.) and try inform as many people as I can. But generally people are threatened by this. If I try to lightly touch the issue people ususally become agressive towards me and would rather talk about soccer and gossip, lol.
If I can save up some money and return to Portugal, move close to family, when things get very rough and try to help them out as much as I can.
What worries me most, about the whole PO thing, is many aspects of human nature (the way I see it, in the majority of people I see). The greed, the need to feel superior, the need to mask low self-confidence in layers over overpriced clothing and other superficial objects.
Another thing that really freaks me out is the following. I feel I have my two feet in the depression phase with a hand still in anger. I feel the majority of the population hasn't even begun to enter denial as they aren't aware of the situation. What will happen when the majority enter the anger phase? Will we turn the blame on each other? I feel war in very much in the question.
I do know that I enjoy reading all the input on TOD. Right now, when I see people are willing to kill each other over soccer preferences, jealousy etc., if faced with energy issues, starvation and health issues....individual preservation at any cost will take hold over working together to get that same preservation.
Thanks again for all the input.
One item I don't think gets as much attention as it should is the effect of price volatility on project development and payback scenarios for unconventional oil. Seems like it would be pretty hard to get someone to invest in a shale oil project at $50/bbl, much easier at $150, and maybe somewhere in between, but what do averages mean when lead times are so long (it takes 4 years or so for any oil to come online from such a project even after startup, and then there is the cost and lead time associated with processing facilities, pipelines, refineries, etc.) - very difficult if not impossible when prices and hence ROI are so unpredictable.
Of course in a credit-constrained environment, this would only get worse.
All around good points - similar to those raised in the Tipping Point white paper from a while back. We may be looking for the wrong signs of the peak here in a lot of ways.
I think all of the statements about peak oil = high prices have been counterproductive. The situation is really much more complicated than that.
Our financial world depends so heavily on debt that an interference with the debt mechanism is a problem.
Are we being efficient in our collection of natural gas? I noticed a lot of flaring of NG, with oil rigs, but no NG production. Just wondering.
In order to produce natural gas, a company has to have pipelines to shore and processing set up. In the case of the Deepwater Horizon blowout, such a pipeline is not available, so the gas is flared.
The original plan was to "shut in' the well for a time, until pipelines and other needed infrastructure was in place. Once that was in place, the plan was to produce both the oil and natural gas.
Oil is generally easier to handle than natural gas. That is a reason you quite often see flaring of natural gas in less developed countries.
Another question:
Platform A in Santa Barbara Channel, which experienced a blow out in 1969 is it still a production well?
I find this very interesting because many, many onshore wells were closed in the 1980's here in Texas. Reopening those wells is not considered economically feasible.
Anyway, are old wells worth keeping?
In this case of Santa Barbara is the old well is producing?
Why is this well still open while others, which are capable of production, are more or less permanently abandoned?
There is the topic of peak oil, but does oil always need to be "for profit"? Or can it be extracted at lower profit? (Such is probably the case with many of the smaller onshore wells-)
Can we look at peak oil differently?
(This is a very good topic by the way!!)
Appears to be.
Generally, oil wells continue in production while it makes economic sense. For most old wells, there are several costs to balance against the income earned by selling the oil. Firstly, the oil usually has to be pumped. The pump is most commonly driven by an electric motor, so the operator has a bill from the power company. Then what is pumped out in an old well is mostly water, sometimes as much as 95% or more salt water. It costs money to separate the oil from the water, and to dispose of the water (the neighbors and the regulators disapprove of just letting it flow into the nearest stream). Then you have to either truck the oil to a purchaser, or send it by pipeline. If the cash flow from selling the oil is less than the costs to produce the oil, or if something breaks down and there isn't enough money in the bank to fix it, the operation is suspended. At that point, if the owner of the well is doing the right thing, the well is plugged and abandoned. Perhaps the sale price of the pump and separator will pay the bill for doing that. More commonly, perhaps, the operator finds an investor who is optimistic about future production and profitability, and sells the well.
Does oil always need to be "for profit"? Many marginal wells are produced at a loss for short periods when oil prices drop, or the water cut increases unexpectedly, but no one is going to this for very long.
More importantly, most of the costs of keeping an old well in production involve using energy, often in the form of oil (for powering the truck used to ship the oil, or to carry the water to a disposal well) and if it costs more in energy, and in particular in oil, to run a producing well, than the energy embodied in the oil produced by the well, there is no point in continuing with production.
As 'lrd" says, wells tend to stay open as long as they are profitable.
To some extent, the profitability relates to the cost of the materials that go in, versus the value of what comes out. If we were talking only oil inputs, you wouldn't pump oil from a well if it took more than one barrel of oil to produce a barrel of oil. At some point, the whole process needs a subsidy--but I am not convinced that is a good way to go, because too often, you are just doing the equivalent of encouraging the use of more than one barrel of oil to produce a barrel of oil.
I might mention too that taxes make a difference in what production is profitable. If taxes are high, a lot of wells are eliminated. If taxes are low, or if there is a subsidy, production can continue for a long time--perhaps even if it doesn't make economic sense.
On producing wells in the Channel:
This is one place to start looking
http://www.conservation.ca.gov/dog/Pages/Index.aspx
Online mapping system and downloadable data files. You have to zoom in to the blue part of the scale bar to see the well symbols; it's otherwise pretty easy to use.
I think you find that the WELL that blew out was plugged and abandoned. Today the regulations would required that, not sure about 1970. But almost always a well that blows out, especially a bad blowout ruins the surrounding formation and the well is a complete write off.
The PLATFORM has a number of wells producing from the same field so oil production from the platform continues but not from the well that blew out.
I have been living in the Santa Barbara area since 1966. Have spent many hours walking or running on the beach, especially in my younger days. Some beach areas have always been plagued by oil seeps. I generally kept a pair of dedicated beach shoes and a solvent for cleaning purposes. This was true both before and long after the spill. I went on one Sierra Club hike to study seeps near Carpinteria. Had to avert eyes passing the nude beaches. The seeps have been known for all of recorded history. The Chumash Indians used tarry material. If memory serves there was much debate about resuming production after the platform A blowout. Some experts claimed that it was safer to produce and thus relieve pressures. I believe that oil was around $2 per bbl when production was initated and was closer to $20 when production resumed. Union Oil would probably been in big trouble had the held oil off the market under their own volition. As I recall the clean up was relatively efficient.
http://www.geog.ucsb.edu/%7Ejeff/sb_69oilspill/69oilspill_articles2.html
http://getoilout.org/
http://www.conservation.ca.gov/dog/kids_teachers/seeps/Pages/index.aspx
http://en.wikipedia.org/wiki/1969_Santa_Barbara_oil_spill
Thank you very much for answering my questions. (Probably dumb questions, but vital to my understanding of availability of oil/gas )
At least some of the oil rigs in the Santa Barbara Channel are still producing.
Yes, and by this time I would hope that we could add a third downward arrow to your "more expensive" and "slower to extract" ones in the first figure--an arrow labeled "more massively ecologically damaging (at least locally/regionally)."
All ff's extracted are, of course, massively damaging on a global scale because of their contribution to increases in atmospheric greenhouse gas concentration, and that might be yet another downward arrow to consider.
And of course there are the political and military problems discussed widely...
It might be nice to have a half dozen downward arrows just to get across that the problems on every level are vast and accelerate enormously as we approach even the middle of the pyramid.
All of this points to the need to find other sources of energy.
That will take the political will to act on hard data. I look at this data and conclude we need to move from gasoline/diesel powered cars to electric powered cars. We need to build a new power distribution system. Then the US needs to build a lot more wind turbines, solar panels, and nuclear power plants.
We need to disengage from ruinous wars in the middle east in order to pay for these changes.
From your lips to policy-makers ears.
But actually, Obama & Chu have poured a huge amount of money into alternative energy, EVs, nuke loans, etc.
Obama has a understading that when he took office he would be viewed as the reincaration of Jimmy Cater. The same Jimmy Carter who gave this speech
http://www.youtube.com/watch?v=injqO8nzCK0
And was tossed out for it - Obama will never give this speech
All of this economic- speak revolves around one fundamental point that never goes away.
Somebody at the end of the day has to pay for whatever it is you are selling. The hardest thing to find in any economy, in any business is a paying customer.
Humans are not born with cash in their pockets or even pockets. Everything more or less: pockets, money, jobs, goods and services comes out of the ground and gets divided. The denominator - the total number of persons available to divide between - keeps increasing, the total amount of stuff that gets divided is shrinking. Something has to give.
All the nuclear reactors, wind turbines, electric cars, 'smart' grids, taxes and governments, militaries and oil discoveries all have end products that have to be sold to people who have money.
Right now, there is a shortage of money and people with money. With the shortage at the beginning, the 'smart set' who is always in the know, has already grabbed as much money as possible. Knowing what they know, there is little chance they are going to spend that cash on ... nuclear reactors, wind turbines, electric cars, 'smart' grids, taxes and governments, militaries and oil discoveries, etc. They just aren't. Why would they?
The current iterations don't profit very much in their use, only as speculative ventures or chips in the finance gambling houses. If money is becoming scarce, doing nothing but keeping it safe in a vault or checking account is going to earn a substantial and increasing value with little risk - because everything else loses value. Why take any risk?
This is the rotting foundation that underlies all the alternative energy sources. The world's comfortable can cob together enough conventional resources to live comfortably and safe while the great unwashed can simply go to hell. It's happened before and the comfortable are clearly comfortable with the idea of the not- quite so comfortable going to hell.
So ... progress for the new American man or woman is a villa in the countryside with vinyards and cow pastures all 'round and nice, well- heeled neighbors. Security by Blackwater. The Obamaville is down the road on the left under the deserted freeway underpass. Be careful when you go down there and hold onto your bags of gold.
There are a lot of problems with that approach. One is that we need additional energy now, not 20 or 40 years from now. Another is that there is a huge cost in moving form gasoline/diesel powered cars to electric cars, not to mention questions whether electric can really be upgraded to give a long enough driving range. There are other issues as well--asphalt is an oil product. Without road paving, it will be hard to operate cars the way we do now.
Also, electric cars require the use of rare earth minerals, plus lithium for batteries. By going to electric cars, we are going from one import dependency to another. There are also questions on what cost will be on ramp up. For example, if it is necessary to use lithium from lower and lower grade ores, the cost of batteries may go up over time, rather than down.
It sounds to me like if there are so many problems with EV's and other alternative modes of transportation, namely they are too expensive relative to gasoline and diesel, and yet there are so many problems with gasoline and diesel, then we need to do a better job of pricing the externalities (problems) of gasoline and diesel. Maybe if all mechanized transport is equally expensive, people will start to get the point (and this is not at all to dismiss the cost and performance problems with EV's, which are substantial).
We definitely can't make a transition effectively if we hide the true costs.
Why do people keep claiming that EVs are expensive? Tesla's are not all EVs. May EVs have been made and are being made at quite modest costs. Google Zap or Zenn. I got my Zenn for 11,000.
Having said that, I think people do need to get the point that the car culture is a dead end. The faster we move away from it the better.
The Zenn is not an automobile replacement, the range is too short.
Yes, of course, if something does not exactly replace BAU it is completely and utterly worthless!!??
Have you read anything on these threads? Do you really think that anything like business as usual is remotely preservable?
The Zenn range (at least in warm temperatures) covers the distance that most urban travelers go in an average day. Most families have two cars, so having this as the one you use for everyday going to the grocery store...type chores will convert those most traveled miles into a form that is ten times more efficient than using a ICE car. I actually think that one of the best things about EVs as the affordable ones exist now is that they make people think twice about what they actually need for the tasks they usually need to perform.
One comparison I have heard is that driving an ICE car--that can go ~300 miles on a tank and 90+ mph when most people rarely if ever need these capacities--for most tasks is like carrying a painters extension ladder that can reach three stories high around the house, even though highest you have to reach is the top shelf in the pantry--not very efficient, and awfully damaging to the house and its inhabitants.
"Does it sound like anything we have run into in the last few years?"
Ugh, yet another "peak oil caused the credit crisis" article on TOD.
Thanks, Gail, for an excellent article.
I know the fine folks over at The Automatic Earth like to frequently harp on that point, but it strikes me as facile at best.
Rather than the far too simplistic "peak oil caused the credit crisis", my reading of the argument is:
What, you may ask, has any of this to do with peak oil? Easy, in the above scenario what exactly caused the economy to stop growing?
Gail is right, there is a strong correlation between energy use and GDP, and I think there is little argument that sudden increases in energy prices have frequently resulted in economic contraction.
A good companion slide to the resource pyramid in Gail's presentation would be the inverted debt pyramid, which shows the obscene amount of debt and other exotic ponzi schemes that are leveraged from a tiny foundation of real physical wealth.
As the amount of physical wealth we can extract from the Earth continues to contract (and exact a growing toll on capital and environment), so too will vast quantities of hallucinated wealth evaporate. Just as we saw with the $30 trillion dollar contraction in global markets at the height of the financial crisis.
Cheers,
Jerry
Very nicely put. You'll never convince mos of even this nuanced and persuasive (to me) position, though. It is something of an idee fixe for him (though he shows much more mental dexterity on most other topics), bless the poor bastard's soul.
Jerry:
Thank you for a great post.
I would add a few points:
1) Ultimately a debt based ponzi economy with an exponentially increasing human population would face some limit to growth on a finite planet. Even if one were to suppose that we could keep oil production constant forever, that in itself (rather than the decline that we can expect), would be enough to kill the ponzi scheme. And even if by some miracle it didn't, we would face limits in other areas, whether it be food, land, water, minerals, metals, what have you.
So in that sense, and in that sense alone, are the commentators like TAE right. However, what they fail to see, like you pointed out, is that it really was oil this time that did it. And it will continue to be oil that will be the limiting factor, although the others may be important in their own ways.
2) Humans psychologically cannot really handle decline. You alluded to this in your last bullet.
This is where I differ from the techno optimists. Sure we might be able to mitigate fossil fuel decline, but mitigation is not the same as improvement (and please no silly, arrogant arguments like obese people are better off riding electric bicycles). No matter which way you slice it, we are in for a major decline in living standards. History and evolutionary psychology suggest that this is met with political upheaval, scapegoating, revolutions, war, etc. So it looks like we are headed for a grim, dark century.
Ultimately one can be an optimist if you assume that we can get back down to say 500 million to 1 billion human population, while still inheriting and maintaining the best traditions of the Enlightenment and not succumbing to a new dark age. Of course, the ultimate hope would be that people the world over maintain some sort of history of this cataclysm, so that limits to population growth is the first priority, or perhaps even organizing principle, of a new human civilization.
Hi Oilman,
Now that would be a real solution!
And what part of that do you not understand?
Excellent paper Gail.
The best ever IMO explaining the impacts of Peak Oil.
Our best hope is biofuels from bio-technologically modified algae.
I think that hope is in vain - in a small scale it may take power a part of the trucking industry
Best hope perhaps, but best option, I dunno...look what the cat dragged in, back a few years ago:
http://www.theoildrum.com/node/2541
/signed
WE
I would not make a long term bet against the team of Craig Venter ans Exxon Mobil.
http://www.ted.com/talks/craig_venter_unveils_synthetic_life.html
Watch only the last minute(starting at 17:17)
Exxon Mobil is funding Venter with $600,000,000.
http://www.exxonmobil.com/corporate/files/news_pub_algae_factsheet.pdf
The 20th Century was the Century of Physics and Chemistry.
The 21th Century will be the Century of Biotechnology.
I would not make a long term bet against the team of Craig Venter and Exxon Mobil.
http://www.ted.com/talks/craig_venter_unveils_synthetic_life.html
Watch only the last minute(starting at 17:17)
Exxon Mobil is funding Venter with $600,000,000.
http://www.exxonmobil.com/corporate/files/news_pub_algae_factsheet.pdf
The 20th Century was the Century of Physics and Chemistry.
The 21th Century will be the Century of Biotechnology.
I am aware of Exxon's investment in this area, and despite hundreds of millions (and billions before them) sunk into developing the technology, I have yet to see much in the area of real progress. I spoke with someone recently who works very closely with Mr. Bennemmen, the author of the article I reposted and a colleague of the researchers later hired to work for Exxon. He (the unnamed researcher) agreed to take a big fat paycheck from them in spite of a dearth of evidence that significant progress had been made in any of the significant challenges described in the article above. There is substantial reason to believe that Exxon's spending on this alternative energy source is more motivated by a desire to improve the company's PR than by a legitimate belief that the technology will be successful.
I would prefer to remain optimistic over the long run, but...show me the progress, not just the money. Not much in the way of real progress on it yet, much like cellulosic ethanol in spite of a very large DOD research budget and the idea of making fuel from algae is older than a lot of people give it credit for. No way to overcome obstacles if we try to hype past them and refuse to acknowledge them...and no amount of money will overcome any of the fundamental laws of physics, chemistry, or biology, try as hard as we might. The economics of algae just don't add up, and $600 million more sunk into research won't fix that. Exxon might have some very smart people, and they may come up with some breakthroughs, but they are not any smarter than the other many scientists who have worked long and hard at the problems, which are many.
Moreover, I'm alway skeptical of essentialist claims such as "Century of X," especially when capitalized. Someone else might call the 20th the "century of wars (many of them over oil)," and we aren't far enough into the 21st yet to make those sorts of bold proclamations...
awahinoil,
Thanks for the link to the Exxon pdf. Unfortunately your statement: "Exxon Mobil is funding Venter with $600,000,000" is a bit misleading.
Here is what it says on the left of page 2:
Please note it states: "if research and development milestones are successfully met". That means they are paying only for results and the program can be halted long before they spend all of that $600 million.
Prudent on their part given the high risk of failure.
Thanks! I am glad you liked it.
I agree bio algae has a lot of promises, compared to wind (which doesn't run vehicles) and corn ethanol (which uses our soil and needs a lot of other inputs).
The problem with biofuels from algae is that they tend to be very expensive--more expensive than consumers can really afford. It is relatively cheap to grow algae outdoors in big ponds (if there is cheap land), but it is hard to control the conditions of the ponds and algae tends to get contaminated. If you grow it inside, then costs are much higher.
We have had quite a number of algae post on The Oil Drum. Here are a couple:
Cost Viability and Algae (Heading Out)
Book Review: Green Algae Strategy (Robert Rapier)
Every TOD reader should share this paper on Facebook or elsewhere.
Send it to your friends, family members.
Peak Oil and its impacts on society has never been so weel explained.
Good article. Time for Oil to go. Too costly, too polluting, the tech is out there but scaling issues and the tech that works in the real world are the gotchas as we try to deal with the atrocity in the Gulf.
Oil becomes too pricey and too problematic (tarsands, etc. as well) for maintaining rubber tire transport as end-all & be-all.
There are few benefits to being old, but an exception is having witnessed America still functioning more on rails than on motor transport. It is in the experience of many still living in the Los Angeles basin, ability to live the "good life" with car optional lifestyle. Younger set (under 70!) can see books on the "Pacific Electric Railway" for methodologies and track footprint, etc.
Regional electric railways, (Interurban Electric Railways) able to run directly connected to renewable source electric generation are requisite in the Oil Interregnum solution set. Bus Rapid Transit seems easier, but does not really address long term freight (food distribution) and general freight carriage required as we go into tight energy syndrome.
tahoevalleylines and aspoarticle1037 postings (Kunstler) detail some talking points for further discussion on the Parallel Bar Therapy regimen... Book "ELECTRIC WATER" (Swan) gives some insights to sustainable energy/water supply/mobility methodologies for local economic units. Oil is for crucial agricultural and chemical feedstock, not only private vehicle convenience. Maybe, energy substitutions make cars feasible for some time, but there are other reasons environmental and strategic to include full continental railway matrix.
When oil prices increased oil consumption tends to give quite a bit. It's why we aren't seeing $150+/bbl currently. People cut back on trips, use more fuel efficient cars more often, and even operate the vehicles they are using in a more efficient manner. Businesses switch to alternatives and/or use oil more efficiently.
After we saw the largest increase in oil prices ever we saw the fastest drop in oil consumption ever. In that context it seems silly to talk about unconstrained demand. It's as real as unconstrained oil production. Everything is constrained/bounded, we live in a finite world after all. This includes oil production rates, supplies, consumption (ie demand), and price.
Nicely put. I would argue, though, that one thing that is virtually unconstrained is human desire for power (especially humans under the spell of certain 19th century delusions, er um, ideologies, er um, philosophies...)
Demand for oil is not dropping everywhere, and there is no reason to think that China, India, many major oil producing countries...are going to any time soon reverse their decades long trend of increasing oil demand and use, except under very sever circumstances.
I also agree that price is not likely to go up enormously because of 'demand destruction' (destruction of us as oil consumers).
But if we end up with Weimar/Zimbabwe type inflation, there is, in principle, not upper limit to how high oil prices could go. You can always "print" more money with higher denomination bills.
Zeroes are free.
China and India are areas where the Jevons Paradox is becoming a major factor. Jevons paradox is that technological progress that increases the efficiency of resource use increases (rather than decreases) the rate of at which that resource is used.
It was operative for 19th century British coal consumption, and it likely will increase the use of oil by 21st century China and India. At the moment they are quite inefficient in their use of oil, but as their economies develop and become technologically more efficient, they will become more and more efficient, and as they do so their consumption will paradoxically increase.
They probably will never consume as much as the U.S. per capita , but China has four times the population of the U.S. and India three times. Seven times the population of the U.S. can consume an awful lot of oil, even if they don't consume very much individually.
I think it's fair to say that anything immaterial can be unconstrained, but that's not exactly quantitative, kinda like calling a spoon happy or something?
China and other non-OPEC countries have been increasing oil consumption, but it's going to be another 2.5 decades before a country like China consumes as much oil as the U.S. and even then it has about 4x's the population of the U.S. As a whole, we have ~6.5 billion people outside of OECD countries consuming ~38mbpd, and ~1.2 billion people in OECD countries consuming ~45mbpd, so I think it's safe to say OECD consumption will continue to drop while non-OECD consumption rises by about the same amount, just like it has over the past half decade or so. Prices seem fairly stable at around $70-80/bbl so that's probably where they will stay for the next however many years IMO.
Even then, countries like China aren't as passive about letting their consumer cash flow to other countries via consumer oil consumption. They have higher mileage standards and are completely (or almost completely) financing the extra cost of PHEVs versus comparable cars.
http://www.nytimes.com/2009/05/28/business/energy-environment/28fuel.htm...
http://blogs.edmunds.com/greencaradvisor/2010/06/china-announces-plan-to...
If by "demand destruction" you are referring to oil's price elasticity of demand then we'll continue to see consumers and businesses move away from oil as it's price increases just like they would with any commodity as it's price increases. Consumers will bike, drive less, get more efficient vehicles, move closer to work, and so on, while businesses will find alternatives to oil as a feedstock and use it more efficiently as an energy source. Interestingly enough, oil's short term inelasticity leading to relatively large price spikes is what makes it more elastic in the long term (It's pretty much why oil will hit ~$150/bbl or whatever, but will settle at something much lower than that).
I don't think we'll see any sort of hyper-inflation any time soon because we just got out of an inflationary bubble in terms of global markets/commodities, but that's just my opinion as always. So far we've been pretty deflationary all things considered.
While we wonder why we dont drill elsewhere consider that our foot print has become a lot bigger. Youall "320,000,000 down in the US and here in Canada at 32,000,000 most within spittin distance of the border would fight tooth and nail to keep petroleum development, Conventional land based production, out of our back yards "NIMBY"
Leaves little else.
Shale gas? think damaged water sheds, compressors, pipelines, wellsites, traffic. So much for your country side in Newyork Penselvainia, Quebec (sic)
Oil Sands? Huge Hole in the ground, A shame to us here in Alberta, expensive, energy intensive destructive to the inviroment.There are studies to sugest that any Natural Gas from the artic would never make it past the oil sands. So much for clean energy
Artic? see GOM, oilsands, etc. long way from market so they...as in OIL COMPANIES want subsidies to bring er south.
Ethanol? Thats our food or at least the ground we grow it on!! not feasible without subsidy and food shortage. Again energy intensive
Economics drive it all, nothing gives us the energy of oil on a per barrel basis,so we are left with Pay the Price at least for now
We now realise that Drill Baby Drill in the off shore deep waters " Think Out of site out of mind" cannot be done without risks that are paramount to ELE's at least locally we need to change our thought process. Forget this global economy bullshit ride to riches for all.
Local economies are the future,lets take back our communities and leave the globalist leeches where they belong.
And I have worked in the "patch" 30 years
Greed.........Sucks
"we need to change our thought process"
Nicely put, and welcome to TOD.
And greed really sucks when it has become part of the basic warp and weft of the entire industrial (and now almost exclusively capitalist, at least in principle) economy.
What kinds of local initiatives do you see as most hopeful?
As someone posted elsewhere, a history lession, that in Rome, greed was running strong and wild, Brutus was greedy, and knifed a friend for it( as the tale goes in the posted history lession). Greed has been around a long time, it is just getting to be such an art form now that few people see it till it is washing oil up on beaches.
Wall street is just one bit of greed, you see it in how people do other things too, just not as news worthy.
Somewhere out there people can gather together and buy inner city tracks of land, and convert them to green gardening communes, spreading out to the houses around them by helping those that own them garden and grow food, collect rainwater, spread the word and grow outward.
Love local food, local food loves your neighbors, and builds fellowship.
Charles,
BioWebScape designs for a better fed and housed future.
I have spent much of the last week reading various books in Latin. I know just a little bit about history.
There has never before been a globally dominant economic system that is premised on defining humans as greed machines and on assuming that endless growth is possible, desirable, and inevitable.
Your examples are of individual power, not quite identical with greed. And in Brutus's case you could argue that it was a relatively selfless (though fruitless and naive) act to attempt to save the republic.
The rest of my time today, by the way, was spent at city-level meetings planning how to convert empty tracts of land into urban farms (among other things).
I'd like to know more about your final points on local financial systems and "completely change educational system." What do you have in mind?
Another good article by Gail. I just wish she had included therein some discussion of "energy return on energy invested (EROEI)," which is a subject that has been well covered on TOD. EROEI is critical to Gail's current discussion, because some of the unconventional sources she refers to -- specifically oil shale -- are "net energy" negative, and most likely will remain so. They are not viable sources of energy. Charles Hall has done a lot of work on this subject and refers to the "net energy cliff," which we seem to be headed toward.
Bottom line, we are in worse shape than most people know or want to admit.
As a physicist, I can't help but believe that the intensity of human activity is determined by the availability of energy, so I'm a receptive audience to Gail's point that the "reason for recession is close tie between GDP and oil production".
http://www.theoildrum.com/files/Reason%20for%20continued%20recession.png
But that graph has a serious case of confusing correlation with causation. It's used to argue that energy supply determines GDP growth or decline, but it could just as well say the opposite: when people are feeling wealthy (whether that's real or a credit illusion) they spend more on energy, taking more trips, buying more energy-intensive goods, cranking up the AC.
I bet if I looked up stats on lobster consumption, I'd find that it's very well correlated with GDP too. But that doesn't prove that the recession was caused by a drop in lobster production.
PS: the phrase of the day is "peak lobster".
Plenty of Colorado oil shale(500 Gb) and Alberta sands(500 Gb) for at least another 50 years of North American consumption.
If this were a 'normal country', there wouldn't be any big controversy. The Government would be backing the Synfuels Corporation like they did in the 1970s.
http://en.wikipedia.org/wiki/Shale_oil_extraction
At $30per barrel shale oil is NOT extremely expensive, especially if Estonia can afford do it or Canada. Brazil chose to develop ethanol to reduce its dependence on oil imports.
It just isn't very profitable so the Big Oil isn't interested and certainly not interested in competiting with Big Gov.
Really, Gail. It's time to drop the false refrain that this is too difficult and to expensive.
I'm not sure I follow the logic here. Shale oil is cheap at $30 per barrel but the major oil companies are not interested because it is not profitable? That sentence contradicts itself.
Superficially maybe.
The lack of Big Oil interest is due partly to US environmental barriers but it also takes a giant long term corporate commitment.
Alberta oil sands are huge cost intensive operations but they are profitable.
It took a huge national US federal commitment to build the Alaskan pipeline which sucked up much of Japan's steel production in the 1970s.
Economists call it,'opportunity loss'.
It's a psychological fact that people's judgement is strongly biased toward short term outcomes even if the facts prove otherwise.
It's no fun having money tied up in serious projects for a long when you could give yourself a raise or bet the money on the lottery.
The shale in Estonia has far more kerogen per ton than does the Green River Shale. Also the lion's share of the shale extracted in Estonia is never refined into oil, it is burnt, as is, in power plants. Rather like coal but with much more ash left over.
The article you listed did not say that shale oil could be produced for $30 a barrel!
Then after this hypothetical shale oil processing plant had produced one billion barrels the cost might be reduced to $30 to $40 a barrel.
Right now shale oil cannot be produced for anything even close to $30 a barrel. Bottom line, if shale oil could be extracted economically then the oil companies would be doing it. When it gets cheaper than ultra-deep water oil production then the oil companies will do it.
Anyway it is all an illusion. Is it not time that people gave up on this silly illusion of unlimited oil from shale:
The Illusive Bonanza: Oil Shale in Colorado
Ron P.
Wow, Ron. You cut off the quote just before it states,
However I don't understand your objection.
I think the US should intend to produce a lot more than one billion barrels of shale oil.
Average cost per barrel declines with quantity produced.
That goes for ultradeep offshore as well.
Duh.
It's true that Estonian oil shall has twice the oil yield(22%) of Colorado(11%) but then the US deposit is richer than the UK Lothian which were continuously worked for a century or the French Autun deposits and are richer than Alberta tar sands which are being produced.
http://en.wikipedia.org/wiki/Oil_shale_geology
Your belief that shale oil is not being currently produced so it is too expensive illustrates a well-known illogical fallacy.
http://en.wikipedia.org/wiki/Fallacy
How much water would be used to produce 5 billion barrels of oils from Green River oil shale?
Over how many years would this 5 billion barrels be produced?
How many billion barrels of oil does the world currently use per year?
Same kinds of questions for the oil sands.
Would it be more feasible to extract the Venezuelan heavy oil first?
Majorian, (how do you pronounce that?), shale oil is not being produced in the USA because it is not economical to do so. From my link above:
Time and time again companies have tried to make shale oil extraction profitable and time after time they have failed!
Your quote from Wiki above is all about Shell ICP technology. That is Shells in situ conversion process. They have, with the aid of massive amounts of electricity, been able to produce some oil and gas. They build a freeze wall around a given area, then heat that area from three to four years, then extract the oil. Yes, that process has yielded a little oil but the total amount extracted using this process will always be peanuts.
This in situ process requires massive amounts of electricity for both the freeze wall and the underground cooking of the shale oil with electric heaters. Do the math, it would require new power plants be built in the desert to supply the electricity if they really wish to produce more than a few barrels. Power plants, even nuclear plants, still require massive amounts of water. There is no water in the desert.
There is a wealth of information on the net concerning Shell's in situ process. You appear to have read none of it. You might start here:
Shell's Shale Plans...? (or Why I Am an Oil Shale Skeptic) Posted by Robert Rapier on May 12, 2008.
It makes for very interesting reading. I suggest you check it out.
Ron P.
Sounds like negative EROEI to me.
Shell's insitu process, which uses less water( 1 gal water per gallon of shale oil) and produces less CO2 than other shale oil extraction methods is the most likely to get approval which is why I emphasized it. It is probably the least energy efficient but is still net energy positive.
If the source of electricity must be green (and not consume water) rather than coal, I have suggested wind across the huge windy southern half of Wyoming at dozen times at TOD.
http://www.colorado.edu/law/centers/nrlc/events/documents/oil%20shale/Oi...
http://fossil.energy.gov/programs/reserves/npr/Oil_Shale_Water_Requireme...
A 3 mbpd program which would replace all of GOM offshore production (2.7 mbpd), 1.1 Gb/yr would require about 150,000 acre feet per year of water.
Lake Powell behind 4.5 Twh Glen Canyon Dam loses over 600,000 acre feet per year in evaporation. Environmentalists have been pushing to
demolish GCD for a long time. 1.1 Gb/yr of shale oil is equal to 1800 Twh of energy.
http://www.coloradocollege.edu/Dept/EC/Faculty/Hecox/CPwebpage/issuespag...
As for R^2, he is skeptical of everything, especially ethanol.
You have suggested wind instead of coal. Well hell, I guess Shell will drop everything and pick up your suggestion. But what in heaven's name does the water lost to evaporation have to do with the amount of water required? Like they can use the water instead of letting it evaporate?
Oh, I see now, you are also going to suggest that they demolish the Glen Canyon Dam. Well hell, if you could just run everything there would be no problem. But you don't!
GOM offshore production in February was 1.638 million barrels per day, up form 1.583 mb/d in January. I don't know where you got 2.7 mb/d from. Perhaps those are your suggested figures and you suggest also that MMS is just lying about GOM production.
Gulf Of Mexico Region, Production Numbers
Yes, of course RR is skeptical of ethanol. You mean to say that you are not?
Shale oil our oil source of the future... and always will be.
Ron P.
2.7 mbpd is all US offshore.
Responding to you was taking too long and I just lost track.
Ron, You're not a complete fool but are unimaginative, prejudiced and skeptical to a ridiculous degree, in other words a bore.
You are completely wrong about MENA conventional reserves, ethanol and unconventional oil.
Why do I argue with you?
All I have to do is wait for you to be proven wrong.
Ciao.
You just make up crap. Where is that other over 1 million barrels per day offshore oil coming from? And post a URL, not just something you pulled out of your butt like that 2.7 mb/d number.
Offshore Drilling: Facts and Figures
I always post my sources. People who just pull numbers out of their posterior never post sources because they never have any.
You will be waiting a long, long time, about as long as we will be waiting for fusion energy, shale oil or ethanol to prove economical without subsidies.
You and your silly optimism are really a riot. I get my laughs every day from you and a couple of others who are continually posting pie in the sky crap. What would we do without you guys who are so damn sure science and technology will save us.
Problems are caused by solutions. What got us into this damn mess will not get us out.
Ron P.
Don't wet your diaper, Ron.
2009;
Fed offshore PAD3=1540 kpd
Fed offshore PAD5=61 kbpd
State offshore =536 kpd
http://www.eia.doe.gov/dnav/pet/pet_crd_crpdn_adc_mbblpd_a.htm
This is where I got the numbers. I guess I typo'd on PAD5. Wow.
The point which I did support is that we could replace offshore oil with Colorado oilshale.
Well good!
If I can bring a sneer to your bitter trollish lips, I guess that's something. You even see disasters where there are none.
I couldn't live with your level of extreme negativity.
I remain convinced that the elements are there for a Good Life after Peak Oil.
This doesn't compute: a solution that works may create different problems but your blanket anti-science bias just shows you're just another luddite.
Enjoy what's left of your life, Ron.
You mean like the Millions who face hunger in arid belt of Africa? Well hell, we all know that is just a lie. Those folks have plenty to eat.
You cornucopians really get me. You deny disasters that are happening today and even reported in print, with pictures an all, just because it disagrees with your "Don't Worry Be Happy" philosophy.
Yes I know. that is why they call it denial.
Ron P.
That's true. People tend to underestimate the technical difficulties in producing oil from oil shale, which is actually neither oil nor shale. I think costs would be on the order of twice as high as Canadian or Venezuelan oil sands - i.e. in excess of $100/barrel - and both Canada and Venezuela have oil sands reserves approximately equal to the world's reserves of conventional oil. Those will be produced first, and when they are exhausted oil shale will begin to be developed - assuming oil hasn't become obsolete by that time.
The environmental issues involved in oil shale development are far worse that oil sands, too. A lot of the purported issues that Greenpeace and others drag out when criticizing oil sands development seem more relevant to Colorado than Alberta or Venezuela. Realistically, the Athabasca and Orinoco River basins don't lack for water for the extraction operations, whereas the semi-desert high plains of the Western U.S. do.
Poli-pests can't talk about changes in how we live because no one wants to hear bad news. Take the GOM BP oil spill as a note on how people love bad news.
Poli-bugs love to talk about how they will help you get your dues, and how they are going to help you see the rosy side of life, but if they really know the bad things that are about to happen, they only have nightmares, not in depth talks on the radio and tv about it.
The few Poli-worms that do talk about the cliff and or wall we are facing, are marginalized by the rest of the media in one way shape or form and are only heard by those of us that know what is happening already.
I know, I know, some bugs and worms are good, and we need them in the world, but do we need the poli part of the phrase?
We could have a king or queen or czar or other single crowned ruler telling us what to do and how many bushels of grain and fruits we must bring around to the castle gates each year, but do we really want a single ruler telling us what to do?
Would us new kids in the 21st century even listen to a father like figure, that wants to help us, if we will only do what he says? What no more TV ads about heavy fat foods, because we have to eat our happy healthy meals we get at the walk up window (drive thrus for bikes). Look Mom I just ate 3 bags of dial-o-heart attack snack, can you get me the sugar-o-rama drink from the cooler.
Disclaimer, I bought one of those KFC new chicken on bacon on cheese on chicken sandwiches, I did share it with my parents, I can't fathom people bitting that thing, I pulled off bits of it and ate it slowly, never to buy it again, it is not worth the money I spent on it.
I am not sure the FDA is ready to claim that burgers by the basketfull are what people in Africa need us to export though.
Here folks, have a handfull of rice with those bottles of american tap water, don't crowd the line, there is enough for everyone to get a handfull each. Yah american pride in feeding the hungry world wide.
Angst in america after thinking about american fast food joints on every corner, and strip malls where fruit trees used to be.
The Poli-people-leaders are just feeding the Top money people the fruits of the labor of the masses.
Down with gravity, up with evaporation.
Angst and rant over.
Charles,
BIoWebScape designs for a better fed and housed future, but not fast food and mac-castles.
If it is true that all the easy oil has been extracted, then obstacles are political and not technical or geological. Take Russia for example, their onshore fields are horrendously managed, production levels are poor (relative to what could be achieved) and declining, and many fields are undeveloped as they lie under the umbrella of Gazprom and Rosneft who don't have the cash or the number of personnel to run multiple projects at once. The oil in these fields is not difficult to extract, but unfortunately the Russian government has decided no foreign company is allowed to develop their major prospects. The result is that this otherwise pretty accessible oil stays in the ground. Similarly, the government of Venezuela seems desperate to ensure more of its oil stays in the ground, Iran's behaviour ensures international sanctions will keep its own oil and gas industry in paltry state of development, the other OPEC countries put an artificial cap on production for political and economic reasons, and environmental concerns prevent drilling in the US and have seriously delayed the Australian projects. The Kashagan project in Kazakhstan (although technically very difficult) has tripled in cost with a decade of delays due to internal squabbling with the contractors, corruption, and the Kazakh government first interfering and then running out of cash. Turkmenistan could offer an enormous supply of gas if the government would wake up and realise the Soviet Union ended twenty years ago.
My point is if the politicians licensed the blocks, taxed the production, and let the oil companies do what they are good at, production levels could be maintained pretty easily (the Russian reserves alone are staggering in size). I expect peak oil will arrive and the world will be forced onto alternatives while billions of barrels languish in the ground only to become utterly useless to the governments which protected them so dearly. But it is not technology or geology that is restricting us here.
If it is true that all the easy oil has been extracted, then obstacles are political and not technical or geological. Take Russia for example, their onshore fields are horrendously managed, production levels are poor (relative to what could be achieved) and declining, and many fields are undeveloped as they lie under the umbrella of Gazprom and Rosneft who don't have the cash or the number of personnel to run multiple projects at once. The oil in these fields is not difficult to extract, but unfortunately the Russian government has decided no foreign company is allowed to develop their major prospects. The result is that this otherwise pretty accessible oil stays in the ground. Similarly, the government of Venezuela seems desperate to ensure more of its oil stays in the ground, Iran's behaviour ensures international sanctions will keep its own oil and gas industry in paltry state of development, the other OPEC countries put an artificial cap on production for political and economic reasons, and environmental concerns prevent drilling in the US and have seriously delayed the Australian projects. The Kashagan project in Kazakhstan (although technically very difficult) has tripled in cost with a decade of delays due to internal squabbling with the contractors, corruption, and the Kazakh government first interfering and then running out of cash. Turkmenistan could offer an enormous supply of gas if the government would wake up and realise the Soviet Union ended twenty years ago.
My point is if the politicians licensed the blocks, taxed the production, and let the oil companies do what they are good at, production levels could be maintained pretty easily (the Russian reserves alone are staggering in size). I expect peak oil will arrive and the world will be forced onto alternatives while billions of barrels languish in the ground only to become utterly useless to the governments which protected them so dearly. But it is not technology or geology that is restricting us here.
Never really understood the point of talking about global gas supplies. It's not like we are getting any closer to building more LNG terminals anytime soon...
And the quantities of oil produceable in KZ, Turkmenistan, etc. are significant yes. Just not significant enough to replace declines from Saudi Arabia, U.S. and Europe. As for Russia, Lahererre did some analysis on their peak based on their discoveries and original oil in place. The actual production curve of course reflects the political issues there over the past few decades.
http://wastedenergy.files.wordpress.com/2010/05/russian_oil_decline.jpg
First peak in the mid-80's, second (much lower) was projected for 2008-2009, with a discovery peak in the 1960's, close to the global discovery peak. I don't have data offhand for how that has panned out but as I understand it Russian oil production is post-peak or at least very near it today. Granted, some of that may have been due to mismanagement of oilfields, but we don't want to overemphasize the effect of that, and it looks to be the same story in essentially any country or region, just varying a bit in timeframe.
In the next 5-10 years we're likely to see the construction of an LNG facility near Murmansk as part of the Shtokhman project, plus another one in Vladivostok. A third train on the Sakhalin II LNG facility at Prigorodnoye is also likely, and a possibility of Yamal LNG going somewhere this decade. Exxon are in the process of constructing an LNG facility at Port Moresby on Papua New Guinea (due for completion in 2013), Chevron will build one on Barrow Island, Australia as part of the Gorgon project, Woodside are constructing an LNG facility in Karratha as part of their Pluto project, and Gladstone LNG will probably go ahead as the first of several CBM projects. Plus, yet more trains are likely to be added to the Qatari projects.
As for Russia's oil, it is not the mismanagement of the oilfields - and subsequent decline - which is the major problem. The main issue is that Russia has many viable prospects but is preventing anyone other than Rosneft or Gazprom developing them and these two companies don't have the cash or expertise to take on more than one or two big projects. The oil is there, it's just nobody can get at it for political reasons.
Finally, I am not convinced Saudi Arabia is going into much of a decline. They still hold by far and away the largest crude reserves, and from what I saw when I worked the giant Burgan field in Kuwait from 2003-2004, the Kuwaitis have an incredible amount too. So many of their wells remained capped, unable to produce to stay within OPEC quotas. We're a long way from running out of available production from Saudi Arabia or Kuwait, but politics - either in the form of OPEC quotas or something else - might restrict actual production.
Hmmm....previously on TOD we have had many, many posts describing in great detail estimates of the increasing water cuts in Ghawar, the number of new wells, flow rate trend predictions, etc. where the case was offered that Ghawar is, or soon will be, entering decline.
You state that many wells have been capped (in Burgan in Kuwait) and I inferred that you implied that this capping of wells and holding back capacity was widespread among OPEC producers.
Then there is the observation made many times on TOD that OPEC producing countries are slowly increasing their internal oil consumption due to expanding populations and higher per capita energy use. With expanding population and expanding energy use in China and India etc, it seems logical that desired (as opposed to fulfilled) demand will continue to rise
The central question keeps coming back to: How much oil is there in those KSA, Kuwaiti, Iranian, Iraqi, etc. oil fields?
We can state unequivocally that Q < infinity, but that leaves some wiggle room.
Edit: Majorian claims 5oo Billion barrels each of oils recoverable from North American oil sands and another 500 billion barrels from NA oil shale. I have seen estimates of up to 1.2 trillion barrels of Orinoco Belt heavy oil. Lets us add another one trillion barrels of oil from other sources (existing fields, new fields, polar, ultra deep-water, whatever). Let us assume yet another one trillion barrels of oil equivalent produced from a combination of GTL and CTL. Let us say about 4 trillion barrels of oil equivalent left to produce, and ~ 30 billion barrels of oil per year consumed.
So, what...after 135 more years of sucking on the oil teet and maybe a 10 billion person population, then what?
Even if we could pull off that kind of production, what would the envronmental consequnces be?
Would we start to get alarmed ate the 110-year point and realize that we only had 20 more years to do a massive technology development and build-out to switch to alternative energy sources?
No, the capping of wells to remain within quota is not widespread amongst OPEC producers, most of them don't have that much spare capacity. But Saudi and Kuwait have spare capacity, loads of it. I don't know how much oil is left in Saudi and Kuwait, but in 2003 we were working on facilities which would have a lifespan of 25 years plus a probable additional 15-20 years, which means Kuwaitis are confident they'll be producing for 45 years as a minimum. Some of the wells at Burgan had been producing since the 1960s without a letup.
"In the next 5-10 years we're likely to see the construction of an LNG facility near Murmansk ... "
Don't hold your breath.
I came into the oil patch doing surface geology mapping for the Mackenzie Valley Pipeline for GSC in 1973, and I still occasionally get to use my maps from ... the last millenium.
Neither Shtokhman nor Mackenzie Valley might not get started in your lifetime.
I've just had an interview for a position with Shtokman Development Co., the first phase of the project is underway with FEED about 50% complete. I think it will be a decade late, 300% over budget, and wracked with problems both technical and political, but I think it will get done. Gazrpom has hung their hat on this one as their flagship project.
When you read Matt Simmons book, Twilight in the Desert, you see the mistake Aramco management made: junior level engineers published in the SPE and AAPG as well as other journals without senior management review. At Conoco, one can never publish without many levels of management review because western oil and gas firms consider their reservoir information to be proprietary. Also, in the 1970s Congress made the then Aramco owners (Jersey, Std of Calif, Std of NY and Texas Co.) reveal the reserve data. In both cases, the ability to produce about 10 mm b/d appears the maximum (oil and condensate). Lucky for the US we control Aramco so it is not the threat that many believe to be cut off for our needs.
Excellent article. One major criticism, though. It is too simplistic to say the mortgage crisis was a result of oil prices causing people not to be able to pay back their debts. The truth is there was intentional manipulation of the housing and derivitives markets. Bad loans were given out knowing full well they would not get paid back, regardless of the oil price. The system was "pumped" in other words, by banks and other lenders, with supportive FED policy, ON PURPOSE in order to bankrupt a large segment of the middle class.
This does not negate the general argument that peak oil leads to fewer and fewer bank loans, but if we want people to take us seriously we have to explain the 2008 crash more accurately. Everybody understands the financial scams that went on (criminal manipulations, including the bailouts afterwards) ini the lead up to the recession. We simply cannot gloss over this and say that it was all a natural result of oil prices rising. People will discount everything else we have to say if we misrepresent what happened.
The way to explain peak oil's role in causing the 2008 recession is like this: In 2000 the FED launched their "easy money" policy which allowed banks to greatly increase the amount of loans. At the same time, the derivitives market kicked in with ever more complex "instruments" to hide the fact that these loans were never going to get paid back. The housing and derivitives bubbles eventually burst. But *why* did the FED allow this to happen? After all, they encouraged it with their policies. And here is where peak oil kicks in. They encouraged it because during Dick Cheney's secret energy task force they realized that peak oil was on the horizon, and a permanent recession was coming. So they made the decision to *pump* the financial economy in order to extract as much profit as possible before the game ends naturally. In other words, they knew about peak oil and they played us. They played the middle class with a classic pump and dump as part of their end game.
And now here we are post peak and all the points apply as described in this article. But we have to acknowledge the complexity of 2008 if we want people to listen to us.
Emanuel
Yes, it was more complicated than "just oil." But it was also more complicated than "just mortgages" since these were mostly an American problem, but the crash was world wide.
(Not that I disagree with your analysis, as far as it goes.)
Those mortgages were only half American - the lenders were overseas.
Further, the housing bubble was international, not just the US.
Great thread, somewhat rambling however from central topic but enlightening all the same.My post is no better of course....
Energy will always take energy, look to the oil sands here in Alberta Canada very benergy intesive. The greatest concern in my mind is the use of fresh water in this process. Its huge and damaging to the Athabasca water shed. Ask anyone who relies on this resource down stream of this,"the largest pit mine on the planet". Think three eyed fish aka the Simpsons local pond. Maybe we could turn the tailings ponds into algea pools. I hear they dont even freeze and its cold here.
The SAGD is less intrusive but uses huge amounts of water and natural gas to produce. Wish they would drill a deep thermal well to heat water in a closed loop system. A company in Nevada does this I think, anyone know about this process??
Heel to Toe is an insitu burn, less water but how much energy is lost in the ground?? Has been proven to work and makes the oil economic but I would think leaves a lot of the oil behind (Burnt Up) in a short sited quest for profit.
The econmics of this mess (Oil Supply) makes my head spin.........
As someone asked in an earlier post
(The central question keeps coming back to: How much oil is there in those KSA, Kuwaiti, Iranian, Iraqi, etc. oil fields?)
Possibly, but I for one cannot see the justification of it enough to sacrifice lives over, not to mention Trillions of dollars.
LNG is for sure a ways off, until major transport and electric systems start to use natural gas.
The makenzie valley pipeline....on going for 40 years. Same story as LNG.
Great Site, Love the Debates
Best Regards to All
Oil sands development is only taking about 2% of the available water from the Athabasca River, and there are not very many people living downriver from the oil sands. It's one of the less populated parts of the planet, and rather well supplied with water resources.
The stories of water contamination are rather over-exaggerated, too. The Athabasca may be a bit contaminated by oil sands development, but not nearly as bad as many rivers in the U.S. Many of them are really badly contaminated by industrial development, and of course there are millions of people living along them.
there is only one "transition" strategy... USE LESS... we will USE LESS... either by choice... or by lack of choice...
in 1973... post US peak and begin of OPEC... what did we do first?
we used less... by design... (well by law)... drove slower... and by lack of choice... even / odd days to fill up our cars...
then... car designs got smaller...
but... then north shore and prudhoe bay came on line... ronald reagan announced the end of the "energy crisis" circa 1985... and by 1995... the hummer was an accepted status symbol... as was the 7000 sq ft house 70 miles from the work place...
governments and people and corporations were flush with cash from the stock market bubble of constantly swapping stocks for higher and higher prices...
i remember a gallon of gas dipping to 88 cents a gallon circa 98-99...
2005 was the first year gas prices went over $2 gallon and have not gone below that price since...
this is not a complete history... but my POINT being... behavior and education of the young is where the promise of the future lies... because we (ME) included.... have lived most our lives turning on switches to make our lives "better"... and if we're not satisfied... switch on some more switches... and go about our business...
the transition to anything CANNOT happen without a corresponding change in usage behavior...
a purely pragmatic approach... and purely NOT probable / practical...
if you have 10% 20% 30% less income each month than you did the year before... assuming a cash only existence... you will spend less...
same with energy... if we are facing a deficit... then that deficit has to be made up... problem is... it will be disproportionate on some... and adopted grudgingly by others...
i'm listening to darryl hanna on BBC the other night espousing her "greenness"... house off the grid... retrofitted car from one of her movies that runs on alcohol... but she admits to flying "a lot"... no hard numbers... but her flights probably offset her "greeness"... plus the efficiency of ten others...
so there you have it... go out and be a super model moviestar... make more money than you can spend in 5 lifetimes... and voila... the solution to the world's energy crisis... nothing more to see here... move along folks...
'cept that nasty uncontrolled well discharging into the gulf... see THAT WON'T add to the cost of oil directly... since it wasn't producing anyway... we didn't "lose" any current production... but... in the aggregate... the costs of the cleanup and loss from the damage... will factor in... again... disproportionately to the total costs of energy... not every one owns a shrimp boat or beach hotel... and most of us will go about our business... regardless how long this thing continues it's uncontrolled discharge...
it's a choice.