Drumbeat: July 20, 2010

Has Peak Oil Arrived?

The cartel wants strong oil prices, obviously, but not too strong lest high prices encourage consuming nations to pursue alternative energies, as they did during the oil shocks of the 1970s. It also wants to assure consuming nations that there is no need to worry about the supply of oil for the foreseeable future, since the fear of running out of cheap oil could force people to turn to alternatives before the cartel are able to sell all the oil they can at a good price.

To my mind, hinting at any other condition, as King Abdullah's order does, strikes me as a significant departure from the narrative of reasonably priced, easily available, limitless oil the Saudis have used to make themselves very, very rich. The departure from the successful script OPEC has followed is a remarkable signal of change to me, one that to my mind indicates peak oil is here - there is only so much oil left, and the Saudis want to sell it when the oil crunch becomes apparent again.

Phil Flynn: The Energy Report for Tuesday, July 20, 2010

Many feared that when China became the world's leader in energy consumption the world would have hit peak oil. There were those who estimated that oil prices would be $200.00 a barrel or more. Yet instead we find ourselves with an oil glut. In fact the only thing that moved the oil market yesterday seemed to be stock market optimism or pessimism and the threat of storms in the Gulf.

Oil drillers, users say world needs deepwater wells

(Reuters) - Energy chiefs defended deepwater oil as crucial to meeting future demand, saying on Tuesday that a prolonged U.S. drilling ban in response to the giant Gulf of Mexico spill could stoke costs and threaten security of supply.

Setting aside the technical difficulties, the United States had embraced deepwater oil as a secure domestic source until BP's disastrous spill began in April and prompted Washington to impose a six-month ban.

Drilling deep under the ocean surface can provide alternative supplies to those pumped by the Organization of the Petroleum Exporting Countries, which is liable to withhold exports to boost prices.

Fear of OPEC action keeps oil prices firm: report

Oil prices have remained firm because the market is convinced that the Organization of Petroleum Exporting Countries (OPEC) would again resort to cutting output to prevent prices from sliding, a global energy institution said Tuesday.

OPEC’s apparent determination to act against any major price decline is offsetting negative signs of global economic recovery and the ample spare oil production capacity in the 12-nation Cartel, the London-based Centre for Global Energy Studies (CGES) said in a study sent to Emirates Business.

Analysis: Oil Prices $80 and Higher Befitting Current Market

Barclays Capital oil analysts believe that $80 or above oil prices are befitting as reverberations following the BP oil spill in the U.S. Gulf of Mexico continue to be felt, Barclays said it a report released earlier this month.

According to Barclays, the fundamentals of restricted supply and economic recovery, which supports higher demand, are in place to support higher oil prices than levels currently seen. Barclays noted that the U.S. Energy Information Administration (EIA) had revised higher its estimate for production lost from the Gulf of Mexico oil spill, noting that U.S. oil production in 2011 could be reduced by 82,000 b/d. EIA also revised its global demand estimates upward for 2010 and 2011, while data from the U.S. Department of Energy continue to showcase robust demand indications for the U.S.

Russia clarifies its border on the Arctic shelf

The flagship of Russia’s polar fleet “Academician Fyodorov” has left for the Arctic on an expedition to clarify the outer border of the country’s continental shelf. It will take 50 scientists on board in St. Petersburg for its 90-day expedition. The scientists will study the Lomonosov Ridge and the Mendeleev Rise in the Arctic with the assistance of the nuclear-powered icebreaker Yamal for 75 days.

Experts say that almost 7 percent of explored oil reserves in the world and 30 percent of gas are under the Arctic shelf. Moreover, there are large reserves of diamonds, gold and minerals. Another promising area is the possibility of laying shipping routes through the Arctic. Scientists insist that it is possible to open shipping routes from Russia’s European part to America or Asia within ten years owing to global warming. Earlier, basically Russia alone studied the Arctic as it has the largest sector in the Arctic shelf, but several countries, including China, which is not an Arctic littoral, have recently focused on the region.

Projection of world fossil fuel production with supply and demand interactions (paper excerpt)

Historically, fossil fuels have been vital for our global energy needs. However climate change is prompting renewed interest in the role of fossil fuel production for our energy needs. In order to appropriately plan for our future energy needs, a new detailed model of fossil fuel supply is required. It is critical to know if fossil fuels will still be able to supply most of our energy requirements and meet the ever increasing energy demand in the future. Answering these questions is critical in order to identify potential periods of energy shortages; so that alternative energy resources can be utilised in a timely way. The aim of this study was to develop a model to predict fossil fuel production for the long term based on historical production data, projected demand, and assumed ultimately recoverable reserves for coal, gas and oil.

Sharjah wilts without power in over 45°C heat for second day

Families living in industrial areas and certain residential pockets of Sharjah were left at their wits’ end, some close to desperation, as power shortages continued into the day on Tuesday.

Korea Gas May Need More LNG From Australian Projects

(Bloomberg) -- Korea Gas Corp., the world’s biggest importer of liquefied natural gas, may need more Australian LNG after signing an initial accord to buy supplies from Chevron Corp.’s proposed Wheatstone project, Citigroup Inc. said.

The ‘Super Skimmer’ That Wasn’t

The test last week was actually the second for A Whale. The company had tried to demonstrate its skimming prowess earlier in the month. It didn‘t work very well then, but seas were rough and the overall verdict was that the results were inconclusive.

This time, on placid waters, the huge vessel was no more effective. The Coast Guard, announcing several days later that A Whale would not be used in the gulf after all, said that “the amount of oil recovered was negligible, and limited oil beyond a sheen was found in the cargo tanks.”

A review of ‘Local Money’ by Peter North

The Transition Towns movement is all about resilience – preparing towns for the challenges of climate change and peak oil. What’s money got to do with it, you may well ask, but money is a valuable tool in relocalisation. Our current money system doesn’t serve us very well. It is beyond our control, in the hands of bankers and politicians and people we might hesitate to trust. It flows in vast quantities to people who don’t seem to do very much to earn it, while others work hard for very little. It is endlessly available for some tasks, and in short supply for other very necessary things. Most of all, it has an unpleasant habit of vanishing out of the places where we live and ending up in London and New York. Local money is a way of re-imagining money as the tool it should be, rather than the master it often becomes.

Smart Decline in Post-Carbon Cities

In 2002, after decades of trying to restart economic development like most other Rust Belt cities, Youngstown made a radical change in approach. The city began devising a transformative plan to encourage some neighborhoods to keep emptying and their vegetation to return. The plan, still early in its implementation as we write (March 2010), would raze underoccupied structures, streets, and alleys to form larger land parcels and home lots, more green space, and new parks.

At the heart of the plan is Youngstown’s acceptance of decline and attempt to use it to improve the remaining buildings, infrastructure, and services by strategically concentrating them.

Dmitry Orlov: Thinking in straight lines

Quite unsurprisingly, our preference for straight lines carries over into the way we think about relationships between things—the mental models we construct of our world. For instance, we consider it a matter of moral rectitude and straight dealing that the price be linearly proportional to the amount of stuff we get: if you pay twice as much, you should get twice as many potatoes. Quantity discounts are acceptable and sometimes expected, but pricing on a curve is generally seen as underhanded. We mistrust curves. Stepwise functions are fine, though, because they are made up of straight line segments. We can put up with having tax brackets, but try taxing people based on a nonlinear formula, and there is sure to be a tax revolt. Were the potato market a product of biological evolution rather than of human artifice, it would perhaps work like this: the price would be some nonlinear function that’s directly proportional to the customer’s net worth, and the number of potatoes dispensed would be some nonlinear function that’s inversely proportional to his net girth. Place your moneybags on one sliding scale, your flab-bags on the other, and some potatoes come out. Such a natural regulatory mechanism would prevent fat, rich gluttons from out-eating the rest of us, but it cannot be, for we have a very strong cultural preference for a simple linear relationship between price and quantity.

Pemex Seeks Record Budget Next Year to Boost Output

(Bloomberg) -- Petroleos Mexicanos, Latin America’s largest oil producer, is seeking to raise its budget 54 percent to a record next year to increase output and reserves, a board member said.

Pemex, as the state-owned company is known, presented a budget proposal of 400 billion pesos ($31 billion) for 2011 to the Finance Ministry today, up from 260 billion earmarked for this year, Hector Moreira, a board member who attended a weekend meeting to draft the plan, said today in a telephone interview.

Mexico, the second-largest oil supplier to the U.S., aims to increase crude output to 3.3 million barrels a day by 2024 and may need to invest more than $25 billion a year to reach that goal, Energy Minister Georgina Kessel said in an April 29 interview. The country produced 2.55 million barrels per day in June, according to National Hydrocarbon Commission data.

Shell stations in Calgary face gasoline shortage

Shell is looking at the possibility of importing gasoline from outside the province to meet a shortage that has seen some city stations left dry.

Spokesman Jeff Gabert said vastly increased demand has led to some stations running out and having to wait to be resupplied.

Eni in Baku to discuss gas projects

BAKU, Azerbaijan (UPI) -- Italian energy company Eni met with top government officials in Azerbaijan to discuss transporting gas across the Caspian Sea, executives said.

Eni Chief Executive Officer Paolo Scaroni met with Azeri President Ilham Aliyev to discuss work in the upstream sector of Azerbaijan.

US seeks answers about Pak-China nuclear deal

ISLAMABAD: US Secretary of State Hillary Clinton on Monday raised Washington’s as well as the international community’s concerns about a civil nuclear deal between China and Pakistan.

Clinton told a joint press conference with Foreign Minister Shah Mahmood Qureshi that Islamabad would have to address the concerns before it could translate the agreement into reality. “The concerns and questions have been delivered to Pakistan and it has to answer the questions now.”

Maritime traffic control ban lifted as oil spill cleanup continues in east China

DALIAN (Xinhua) -- Authorities lifted a partial ban on maritime traffic at a major northeast China port Tuesday, four days after explosions hit crude oil pipelines here and caused a lingering oil spill.

The Maritime Affairs Administration of Liaoning Province reported that the ports in Dalian City have fully re-opened to traffic as of 5 p.m. Tuesday as waterways affected by the oil slick have been basically cleared for the resumption of shipping.

Budding greens: Environmental groups in China

CHINA’S environment, most obviously the air in its cities, has been deteriorating roughly at the same dizzy pace that its industry has been expanding. Now some young activists, notably in university environmental clubs, are campaigning to raise awareness of pollution. In the process, they are among the first of their generation to dabble with political participation.

Record flood peak hits China’s Three Gorges dam

Officials said China’s Three Gorges dam on Tuesday passed its biggest test since its completion in 2008 as a major flood peak brought record water flow along the Yangtze River.

The flow reached 70,000 cubic metres per second above the dam, far higher than the 50,000 cubic metres per second recorded in 1998 when floods along the Yangtze killed 4,150 people and forced the evacuation of more than 18 million people.

Bill McKibben: The Real Environmental Disaster

You don’t compromise with a blown-out oil well, and you don’t compromise with the molecular structure of carbon dioxide. They don’t do compromise.

The End of Automotive Mobility?

The global economic crash came on the heels of the 2008 oil-price explosion, which proved to be short-lived but is likely to return as global oil supplies are stretched to the limit. New technologies like lithium batteries and hydrogen cars promise to free us from dependence on fossil fuels without separating us from our cars, but even the most remarkable breakthroughs cannot replace our automotive fleet anytime soon. By the time something comes along to supplant the cars that we know – and something will, eventually –we may have had the chance to rethink our dependence on them.

Few of us will voluntarily renounce our modern mobility. Yet the end of cheap oil – along with the recession – invites us to escape the burden of car loans, sell the second car, drive less, car-share, choose smaller vehicles, mass transit, bicycles, or our feet, or move to walkable, transit-linked neighborhoods.

At home, panel discussions

Environmental concerns (and lower costs) are motivating more residents to go solar.

Caribbean System Has a 40% Chance of Developing Into Cyclone, Center Says

An area of thunderstorms and clouds is becoming more likely to develop into a tropical cyclone in the next two days, the U.S. National Hurricane Center said.

The weather system over the northern Leeward Islands, the Virgin Islands, Puerto Rico and the Dominican Republic has a 40 percent chance of becoming a cyclone, the Center said today in an advisory posted on its website at about 7:45 a.m. Miami time. That’s up from a 30 percent chance six hours earlier.

The tropical wave is moving west-northwest at 5 miles (8 kilometers) to 10 miles an hour. That puts the system on a track of heading toward the Gulf of Mexico, where BP Plc is trying to clean up the worst oil spill in U.S. history.

Crude Oil Rises for a Second Day on Optimism Fuel Demand Will Increase

Crude oil declined in New York as tumbling equity markets wiped out gains spurred by a forecast that U.S. crude inventories declined for a fourth week.

Oil retreated with European equities and U.S. stock-index futures after earnings and revenue reports from Goldman Sachs Group Inc., International Business Machines Corp. and Texas Instruments Inc. missed analyst estimates. U.S. crude oil supplies probably fell 1 million barrels last week, according a Bloomberg survey before tomorrow’s Energy Department report.

China surpasses U.S. as top energy consumer

China has overtaken the United States as the world's largest consumer of energy, according to data from Paris-based International Energy Agency, a landmark that has implications for oil prices and U.S. global energy policy.

News reports citing data from the IEA said China consumed the equivalent of 2.25 billion tons of oil last year, slightly above U.S. consumption of 2.17 billion tons. The measure includes all types of energy: oil, nuclear energy, coal, natural gas and renewable energy sources.

China dismisses IEA analysis of it being world's top energy user

BEIJING - A Chinese energy official on Tuesday rejected a report by the International Energy Agency (IEA) saying China surpassed the United States to become the world's biggest energy consumer last year.

"IEA's data on China's energy use is unreliable," Zhou Xian, an official with the National Energy Administration (NEA), said at a press conference.

China power consumption to rise 11 pct this year: NEA

(Reuters) - China is likely to consume about 11 percent more electricity this year than in 2009, with second-half growth easing on the government's curb on heavy users and a higher year-ago base, the National Energy Administration said.

Gasoline Shipping Rates May Fall From Highest in 21 Months

The cost of shipping gasoline to the U.S. from Europe may fall from the highest level in 21 months as growing inventories indicate a diminishing need for imports.

Oil Majors Boost Plans to Expand Iraq Oil Output

BAGHDAD—Despite another violent day here Sunday, foreign oil companies unveiled several deals recommitting themselves to a major petroleum-development push that the government hopes will kick-start Iraq's vast but dilapidated oil industry.

EU turns screws on Iran

European Union foreign ministers will adopt tighter sanctions against Iran next week, including measures to block oil and gas investment and curtail its refining and natural gas capability, EU diplomats said.

A draft declaration prepared for a meeting of EU foreign ministers showed they would approve a decision taken by EU leaders on 17 June to adopt further sanctions over Tehran's nuclear programme, and also call on Iran to resume talks.

Argentine Manufacturers Face Natural-Gas Shortages on Record Cold Weather

Argentine industrial users such as Dow Chemical Co. are suffering gas shortages amid a record cold winter in the Latin American country where temperatures fell below those in the South Pole.

“We’ve been facing gas shortages for three or four years, but this year is worse, maybe because of the cold,” Soledad Echague, Dow’s public affairs director in Argentina, said today in a telephone interview from Buenos Aires.

Spanish oil company explores drilling off the Cuban coast

Havana, Cuba (CNN) -- Spanish oil company Repsol is in "the exploration stage" of oil drilling off of Cuba's northern coast, prompting a controversy in south Florida over fears of a potential spill.

Poland Won't Know Extent of Natural Gas Shale Reserves Until End of 2011

The extent of Poland’s shale gas reserves should be known by the end of next year, the country’s Geological Institute said.

“We will probably have 3-4 wells this year and there will be 5-10 next year,” said Pawel Poprawa, the head of the petroleum geology laboratory at the institute. “By the end of 2011 we should know if there’s gas in the rocks and, if so, how rich the deposits could be.”

BP cap stays on as 'static kill' idea floated

NEW ORLEANS, Louisiana (AFP) – The US government allowed the BP cap stemming the oil flow in the Gulf of Mexico to remain in place Tuesday as plans for a "static kill" were discussed to seal off the source of the ecological disaster.

US disaster response commander Admiral Thad Allen said engineers had found seepage and other anomalies, but said none were "consequential" enough to stop the well integrity test, now in its fifth day.

BP's fine could hit the billions

NEW YORK (CNNMoney.com) -- Just how much will BP pay in fines to the U.S. government? In a worst case scenario, they could top $18 billion.

BP has already announced a $20 billion fund to compensate disaster victims. But it will also owe a huge amount in fines for violating the Clean Water Act: Up to $4,300 per barrel of oil released if it's found the company was negligent in causing the disaster, according to a Justice Department spokesman.

Before rig explosion, BP pumped chemical mixture into well, contractor says

KENNER, LA. -- In the hours before the Deepwater Horizon drilling rig exploded, BP pumped into the well an extraordinarily large quantity of an unusual chemical mixture, a contractor on the rig testified Monday.

Tendrils from oil spill extend into politics

WASHINGTON — Energy giant BP has stemmed the flow of oil running into the Gulf of Mexico, but the political fallout from the spill continues to seep into House and Senate races across the country — including in states unaffected by the disaster.

Attention on the leak, which the government estimates has sent at least 90 million gallons of oil into the Gulf since April, has reopened the debate over offshore drilling and, in some cases, re-energized the fight over broader energy legislation.

Taking Lessons From What Went Wrong

Disasters teach more than successes.

While that idea may sound paradoxical, it is widely accepted among engineers. They say grim lessons arise because the reasons for triumph in matters of technology are often arbitrary and invisible, whereas the cause of a particular failure can frequently be uncovered, documented and reworked to make improvements.

Disaster, in short, can become a spur to innovation.

From gumbo to lemonade, Gulf aid has many facets

As the size of the spill grew, Heather Emmert of Environment America fielded dozens of phone calls and e-mails from people looking to help. "There wasn't a lot people could do," she says.

Then the group, which opposes new offshore oil drilling, devised "Gumbo for the Gulf" to channel that energy into fundraising. Emmert created an online guide that volunteers could follow. So far, 35 gumbo parties have raised about $13,000, she says.

Oil Sands Rising as BP Spill Casts Palls Over Future of Deepwater Drilling

Suncor Energy Inc. and Canadian Natural Resources Ltd., two of the largest oil-sands producers, rank among the biggest winners as a U.S. halt on new Gulf of Mexico drilling leads investors to alternative crude sources.

Dalian oil pipeline blasts cut oil supplies to southern China, price impact limited

The oil pipeline blasts in northeastern port city of Dalian Saturday have affected refined oil supplies in southern China but oil prices there will not be impacted upon, industry analysts said Tuesday.

China Pipeline Blast, Port Oil Spill Caused by `Catalyst,' Government Says

A pipeline explosion at a port in northeastern China which led to an oil spill covering more than 60 square kilometers (23 square miles) was caused after a “catalyst” was added to a crude-oil storage tank, the government said.

The error was made when an oil tanker was unloading at Dalian port on July 16, according to statement on the Ministry of Transport’s website, which didn’t say what the substance was or who was responsible for the incident.

China uses oil-eating bacteria in Dalian oil spill cleanup

Over 23 tonnes of oil-eating bacteria are being used to clean up the oil spill off the coast of northeast China's Dalian City, four days after pipelines exploded near one of China's largest oil reserve bases.

Citigroup Hires Biro From Goldman to Head Global Oil Trading in Singapore

Citigroup Inc. hired Rob Biro from Goldman Sachs Group Inc. to lead global oil trading in Singapore, the first U.S. bank to base a worldwide trading head in the city, according to two people with knowledge of the appointment.

On Eve of Washington Visit, Cameron Criticizes the Lockerbie Bomber's Release

When Lockerbie bomber Abdel Basset Ali al-Megrahi was released from Scottish prison in August 2009, David Cameron, then Britain's opposition Conservative Party leader, publicly stated that he thought the move was "wrong." Now the issue has come back to haunt Cameron in his role as Britain's new Prime Minister, with BP admitting last week that it had pushed to speed up a prisoner transfer deal with Libya — which included al-Megrahi — and U.K. politicians branding the decision to free the Libyan a "mistake." As the issue threatens to cast a shadow over the Prime Minister's first official visit to the White House on Tuesday, July 20, Cameron finds himself having to remind people that he was against the release from the start.

Forum looks at ways to curb oil dependence

BENNINGTON -- The impotence of the federal government and British Petroleum in capping the Gulf oil spill in the days and weeks following the Deepwater Horizon oil rig explosionis telling of more than just the perils of deepwater drilling.

That’s according to Emery Forest and other members of the Walloomsac Transition Initiative, who see the oil spill as an exemplification of the inertia and reactive nature of multinational corporations and the federal government.

From Sustainable Edmonds: A wake-up call to pursue alternative energy

At this time in our history, there are some who believe we have reached the point of “peak oil.” In our lifetime, increasing demands will outstrip production as supply lessens and becomes prohibitively expensive. Many refuse to even consider this possibility, while the U.S. military prepares contingency plans for its inevitability as a major threat to our national security. You can imagine that the federal government is surely a major consumer of oil.

Think Locally, Act Globally

The last several days have sharply reminded me just how connected our local, national, and environmental challenges are -- and how important it is to think locally before we act globally, not just the other way around.

Beyond Oil: What's Left?: Matt Simmons Gambles with Ammonia

Although he is more often recognized for his outlandish oil price predictions (no, we haven't hit $300 per barrel... yet), and author of a book you should have read by now – Twilight in the Desert, Simmons is shifting gears once again.

This time, he's got his sights set on Ammonia. As you can see in the image above, ammonia is a compound of nitrogen and hydrogen. Simmons' plan is to utilize offshore wind energy to produce ammonia, which can be used as a fuel.

Ocean Energy Institute steps up activity in Maine

The Ocean Energy Institute will hold a grand opening for its new office in Rockland, Maine, on Tuesday, with plans to pursue offshore wind projects in the Gulf of Maine.

The organization, a nonprofit founded in 2007 by investment banker Matthew Simmons, has been working to research and promote offshore wind production in Maine, said director Robert West.

Philippines "seriously" considering nuclear power plant: energy secretary

The Philippine government is " seriously" considering the construction of a nuclear power plant in the country to address the looming power crisis, Energy Secretary Jose Rene Almendras said on Tuesday.

Forging a Coherent Oceans Policy

The White House on Monday announced that it was forming a new National Ocean Council to try to make sense of the dozens of laws and overlapping agencies governing policy on oceans, coasts and the Great Lakes. The new body, which will include 24 officials from various federal agencies, will not have the power to propose new laws or regulations. Rather it will set broad policy goals and try to referee between conflicting commercial and recreational uses of the nation’s aquatic resources.

First half 2010 hottest ever, but is it climate change?

The first six months of 2010 brought a string of warmest-ever global temperatures, but connecting these dots to long-term climate change patterns remains frustratingly difficult, experts say.

Veggieworld: Why eating greens won't save the planet

It seems like a no-brainer, but is it really that simple? To find out, let's imagine what would happen if the whole world decided to eliminate meat, milk and eggs from its diet, then trace the effects as they ripple throughout agriculture, the environment and society. The result may surprise you.

German Industry Profits May Be Reduced by CO2 Emissions Costs, FTD Reports

Germany’s energy intensive industries may have their profits cut by as much as 87 percent by 2020 due to the costs of carbon emissions certificates, the Financial Times Deutschland said, citing a report from Goetzpartners Corporate Finance Ltd.

UK - Climate change: buyers face tax penalty for poorly insulated homes

Homebuyers purchasing properties with poor insulation could be hit with a tax bill for thousands of pounds under new plans being considered to combat climate change.

Utilities and Environmentalists Haggle Over Climate Bill

Utility executives plan to head to Washington this week to weigh in on the latest iterations of legislation to control carbon dioxide emissions.

If Cap-And-Trade Dies, Is An Energy Bill Still Worthwhile?

The talks over the Senate energy/climate bill are still very, very fluid. A whole lot could change in the next ten days as Harry Reid's office tries to cut and paste from different pieces of legislation and assemble something that can garner 60 votes. But, right now, the odds look pretty bleak that a cap-and-trade system will make it into the final bill. Which raises the obvious question: If there's no cap on carbon, what else is there? And could a cap-less bill still be a decent piece of legislation?

Static Kill.....kill, kill, kill, the well!
Do not allow BP to collect and sell the oil from that well.
Tropical Storm is on the way by Sunday. Hurry Up!

Has Peak Oil Arrived? YES!

BUT, Most people do not believe it or know about it.

Things will change rapidly when they BELIEVE!

Ocean Energy Institute has published an overview presentation of the Pickens Plan Plus a.k.a. the Simmons Plan.

  • The Pickens plan is an enormously valuable and timely solution to America’s Energy Security crisis
  • The impact of that already powerful plan (38% cut in liquid fuel use) can be more than doubled by adding to it the vision of a Texas deep water oil man: Matt Simmons “The Paul Revere of Peak Oil”
  • Offshore wind on both coasts and Great Lakes
  • Algae biofuels using agricultural and sewage runoff

That's a very bold plan, looks good on paper though.

I'm not sold on the idea of ammonia as a fuel. I prefer the idea of using excess electricity to offset natural gas/oil used in heating and coal in power generation, then if you have any left you can upgrade biogas to biomethane which you can use in your existing infrastructure

But it doesn't need to be an either/or. As with Savings, DIVERSIFY.

If the actual economics or energy efficiency of the transfer of ammonia is horrible, that's a different question. But there are certainly advantages of having some of your energy stored in Bottles and Tanks for that Rainy Day.

Shoot for the stars, settle for the moon or even low earth orbit.

If wind powered ammonia plants are built, we can use every drop if it to manufacture fertilizer, explosives, and other highly useful products.Maybe there will even be some left over for motor fuel!

I haven't been able to find out if ammonia plants are easily turned on and off as the wind blows, or how big a part of the cost of ammonia is energy inputs versus capex.

If the plants aren't too expensive,and can be cycled on and off easily, the wind energy could be used during off peak hours and periods of low demand and high wind at the ammonia plant; and fed into the grid otherwise when available as needed to help with peak loads.

It is a super neat house which I visited in Seabastopol,Ca. However, he has since moved next door into a 500 square foot house with his wife and child. But that is still commendable.

I have lived in a 500 square foot mobile home as well as a much smaller dormitory room with a roommate .Such arrangements are not at bad at all if you have the option of getting outside a lot;we had complete plumbing, air conditioning, a good refriferator and range, and so forth.

What we didn't have was room for a lot of STUFF.

I stored most of mine elsewhere , such as out of season clothing and books.

Ah, yes, a waypoint on the road to Billennium. 'Cos the bestest and highest goal is to stuff the world full of as many people as possible and see if it bursts...

The Palm Beach Post - Feb 13, 1971

Many oil men were thus unprepared for the militancy at a Caracas meeting when the 10-nation Organization of Petroleum Exporting Countries (OPEC) served unprecedented joint demands for higher revenues and threatened joint retaliation if refused.

The OPEC countries, which account for 90 per cent of world oil exports, are Venezuela, Indonesia, Iran, Iraq, Kuwait, Saudi Arabia, Qatar, Abu Dhabi, Libya and Algeria.

Why, many people ask, had the producing countries suddenly escalated their chronic discontent to a major confrontation? The answer is the countries believe they hold a winning hand — at this time.

However, it is a special short-term advantage rather than the longer term one that has compelled the Middle East countries to move now. This advantage is that international oil, to general surprise, has been transformed over the past 12 months from a buyer's to a seller's market.

Until a year ago, oil economists were convinced world oil supplies would remain in substantial surplus and that the low market prices prevailing since the end of the 1950s would continue. With major new discoveries in the Alaskan North Slope, the North Sea and, Indonesia, this long-term view still seems valid.

The increased oil demand (up 11 per cent just in Europe last year) has coincided with the shortage of oil supplies and of tankers needed to bring the oil from the Persian Gulf around the tip of Africa to Europe.

Last fall, Libya used its strong position to force increases in tax and royalty revenues upon the American and British companies, and these concessions were extended in modified form to Persian Gulf countries.
Under the impact of these higher costs, increased ocean shipping costs and sharply higher demand, product prices have risen in Europe and the U.S. and company profit margins have improved.

In this situation the producer countries decided to act to secure additional gains for themselves. Last month they announced their demands for increases to bring Persian Gulf prices more in line with Libya's and to standardize the tax rate at 55 per cent (compared to 50 per cent for two decades) that had been conceded to some countries last fall.

Although the companies bristled at the ultimatum, the demands did not appear too bad. But when Libya moved ahead with new demands of her own. the companies saw red.

But the negotiations are being held this winter, and the situation has changed. An unforeseen spurt in the demand for oil products, particularly fuel oil has followed from the rapid rundown of world coal production combined with the failure of nuclear power to increase power reserves as quickly as expected.

Link up top: Oil Majors Boost Plans to Expand Iraq Oil Output (Behind a pay wall but available through Google.)

BP PLC and China National Petroleum Corp. said Sunday they are on track to increase production by more than 100,000 barrels a day from the giant Rumaila oil field in southern Iraq by the beginning of next year. Rumaila now produces 1.07 million barrels of crude a day.

These companies, BP, PLC and China National Petroleum, hope to increase production in the Rumaila field by 100,000 barrels per day. That is an increase of 9.35 percent. And they will get $2.00 per barrel for every barrel increased over current output. That comes to $200,000 per day or $73,000,000 per year. I guess that would cover the cost of all that drilling. Of course that is what they hope to add next year and i am sure they hope to add more in the years to follow.

But the ultimate goal from Rumaila is 2,850,000 barrels per day, an increase of 166 percent over current production. And that current production is declining by 6.1 percent per year. I have no doubt that with massive infield drilling, with horizontal MRC wells, they can increase Rumaila production by 10 percent, and even a little more in a few years. But they cannot possibly quadruple production in the next seven years as the contracts call for.

Two oil-licensing auctions last year awarded 11 deals to international oil companies. If all the companies live up to their production promises, the projects will add nearly 10 million barrels a day of capacity by 2017 to Iraq's existing output of 2.5 million barrels a day.

What I really expect is a small surge in Iraqi next year and a smaller surge he year after but not much after that. Total increase will very likely be somewhere around 20 percent. They will stay on a plateau for several years, just as others who have used this strategy did. But they the water will hit these horizontal wells and the decline will be fast and furious.

But they, if successful in this endeavour will really be in the catbird's seat. They will have oil production of about 3 million barrels per day while other nations, who began their horizontal drilling projects about a decade ago, will be in steep decline.

Ron P.

So I guess the displacement and killing of a million or so people will pay off after all.


what do we know about rumaila ? not much.
wiki states that rumaila "contains" 17 gb, and is the world's 4th largest. from that, i take it that 17 gb is remaining recoverable.

rumaila is producing somewhere around 900,000 bpd from 8 wells.

from spe articles on rumaila, the field is a partial water drive with a plan to inject additional water asap.

so we really dont know much about the potential of rumaila either. maybe they could drill 18 more wells and have 75,000 bpd spare capacity.

Toronto converts two car parking spots to 16 bicycle parking spots


Good News - Increased bicycling is creating increased demand for bike parking.

Bad News - That converting TWO parking spaces for cars to bikes is news.

Best Hopes that increased bike parking becomes non-news,


Greedy Cyclists think they own the WHOLE WORLD!

I was gonna park there, I called it.

Link up top: Has Peak Oil Arrived?

Great article, everyone should read it. To me this indicates that the peak oil message is finally getting out. This was posted by the NASDQ and was first published by Cabot Heritage Corporation.

But there is one thing that puzzles me. From the article:

Consider this: About 10 years ago, OPEC sources indicated Saudi Arabia needed to sell a barrel of oil at $18 to break even. Two years ago, data from ratings agency Fitch (which cares because it evaluates sovereign debt) estimated Saudi Arabia's breakeven had risen to $26. In January, Fitch pegged breakeven for the country at $68 a barrel. If it costs more to produce oil, it clearly is harder to get. And Saudi Arabia is the primary low-cost oil producer on the planet.

Ten years ago Saudi Arabia needed to get $18 a barrel to break even. Two years ago that figure had risen to $26. And this past January the break even point was pegged at $68 a barrel. But the fee all those major oil companies will be collecting from Iraq for every barrel of increased production averages about $2 a barrel and in one case only $1.15 a barrel. What is this? Can they drill in the desert for only two bucks a barrel or less? Something just does not make sense here.

Can anyone shed a little more light on this subject? I am at a loss to imagine how the major oil companies can bid a contract for $2 a barrel or less when Saudi has a break even point of $68 a barrel. This cries out for an explanation. I am at a total loss here.... HELP!

Iraqi Contracts and Fees per Barrel

Contractual Incentives and Penalites to Motivate Oil Companies Increase Iraq Oil Production to 12 million barrels per day

Ron P.

Can anyone shed a little more light on this subject? I am at a loss to imagine how the major oil companies can bid a contract for $2 a barrel or less when Saudi has a break even point of $68 a barrel. This cries out for an explanation. I am at a total loss here.... HELP!

Oh... Ron, I have no problem to understand that, I see the ELM in action there. You know, people of SA using more oil/energy for their domestic needs, therefore SA requires higher price for the same (or less) amount of oil it sells to subsidize all that population growth/consumption. They were talking about "breaking even". I think what they meant by that was: "keeping our living standard in the middle of the desert, while our population and/or consumption is rising".

What I am at a total loss is this:

Peak oil is the theory that at some point, the world will have used more oil than there is recoverable in the ground, causing big problems for both the cost of oil and long-term energy stability.

(emphasis mine)

What?? How can one use more oil than there is recoverable in the ground??? Half of it, suuure, but more than there is?
Okay, okay, I will consider it a typo. O:-P

P.S.: I totally agree with you - great article, and also, everyone should read it. :)

they are refering to the part of recoverable that remains to be recovered.

recoverable is often used in reference to either ultimate recoverable or remaining recoverable.

you dont want to get me started on the term reserves.

Oooh, now I see! :)
Thank you very much for pointing me to the right direction. :)

I'm very familiar with all those terms, because they are generally quite confusing, so I studied them carefully to avoid the confusion. :D

But me writing that article, I would use either the word "remaining" or "still" or something that would clarify that it means the remaining half.

Then again, maybe to others (even to common citizen/reader) it was perfectly clear and problem here was my poor (non-native) English. O:-)

No, your English is just fine, for someone who isn't soaking in the jargon that reads like "when we've taken more oil out of the ground than we can". I am a native speaker and that's how it looked to me at first, too.

I agree with Ron, Darwinian.

I think that Saudi Arabia has a lot of "middlemen" and "royalties" that increase the break even point in addition to more local consumption. Also, the oil in Iraq is not as costly to recover at this point. I do not believe that Saudi is the low cost producer anymore. Since a lot of wells in Saudi are running low, it takes more effort to get the remainder of the oil out too.

I have posted Rockman on another list. He has promised to respond this afternoon.

Ron P.


I'm pretty sure that the highly variable numbers are for the MARGINAL costs of getting an extra barrel pumped out of the ground and not the much more stable LONG-RUN-AVERAGE COST number, which is way way below MC.

If you go after more difficult oil, MC can easily double or triple or quadruple, but to know whether a company or a country is making money on the oil that is pumped, you need to compare price with LRAC.

Because OPEC is an oligopoly, it does not have a stable supply curve. If the industry were one of pure competition, Price would tend in equilibrium to equal the point where the minimum of the LRAC curve is cut by the marginal cost curve.

Don't cry for OPEC, they are making tons of money with oil around $75, and they will still make tons of money if price falls to $60/barrel.

If critics like Michael C. Lynch are right that peak oil is either non-existant or decades away, why are all these oil companies like BP Plc, PetroChina and ExxonMobil even think of drilling in a place still frought with incredible risks of geopolitics? (Iraq)


That is a great question for it forces the subject to think. And...the only solution I can think of is: Because we are at or near Peak Oil.

They do it because they think they can make a lot of money. Oil companies look at each "contract" only from that light. Politics, environment, human rights, depletion, anything else is only a sub-issue.

Ron -- I scanned the links quickly and couldn't find what I was looking for: An indication that capital costs were recovered before the lop sided split came into effect. I've seen many deals where the operator might recover the capex at 90% of the revenue but then reduced to a fraction once capex+ is returned. That could be part of the answer. I also suspect some of these may just be "throw aways": the operator knows there's little potential for profit but it buys them a seat at the table and, hopefully, an edge to get into more profitable deals later. There's also a third distinct possibility IMHO: they made stupid deals. Wouldn't be the first time I've seen a company negotiate themselves into a money losing project.

I think "seat at the table" is part of it.
There was an article I remember reading a while back about how several of the major independents walked away from these deals because the Iraqis were playing such hardball. This may have been a negotiating ploy; doesn't seem to have worked. I'm not sure, however, if all the original players returned to the table.
Could also be that there are some proprietary sweeteners added by the respective governments. The fact that the Chinese jumped in right away may have given some of the OECD governments a wake-up call.
Could also very well be that a bunch of people are being stupid. I'm cynical enough to favor this explanation;)

seat at the table and a table at the bazar.
refiners need the oil supply so they can make lots of gasoline and glyphosate.

The fees you are referring to are the "plus" part of a cost-plus contract. Iraq pays all the costs. Based on the links you provided, the plus part only gets paid if the target production is achievded and maintained. You can bet on the costs being inflated so the operators will still make a profit even if they don't achieve the plus part and the services firms will flat out make a killing.

If the break-even point for finding oil in Saudi Arabia is now $68 per barrel, that could be the real reason why King Abdullah ordered a halt to all exploration. A cost like that would mean that it is now uneconomic to explore for new oil in Saudi Arabia, so there's no point in continuing to do so. They would be better off putting the money into useful programs like education, which would have a better rate of return in the long term.

A cost of $68 per barrel would mean that Saudi Arabia's incremental production now costs about the same as Canadian oil sands projects do. Since Saudi Arabia used to be the world's low-cost producer, that changes the fundamental economics of the global oil industry. There are no longer any low-cost producers.

The fact that Saudi Arabia's average production cost is much lower than that is irrelevant to their sales price. They're not going to sell oil at their average cost, they will want to sell it at their marginal cost or higher.

Can anyone shed a little more light on this subject?

have you considered the possibility that fitch doesn't know what the he11 he is talking about ?

re: China surpasses U.S. as top energy consumer

This is something of an historic moment. A few years ago, China passed the US as the world's top CO2 producer, and now it is the top energy consumer. At current growth rates, their energy consumption will be double that of the US in another decade. They're now the 900-pound gorilla in the energy markets. They're buying up oil wherever they can find it - West Africa, East Africa, the Middle East, Canada. They're stockpiling uranium for the new nuclear reactors they're building, and putting about $60 billion into Australia coal export developments.

Many people would argue that they couldn't possible double their energy demand in a decade, but they would have argued the same thing a decade ago, before China doubled its energy demand to its current level. I think you shouldn't underestimate the Chinese. They're on a roll and they can keep it up for quite a while. Eventually they may be as affluent as the Americans, but that may be partly because Americans will be less affluent than they are now.

For the time being, they can make great advances because their energy efficiency is quite low, and the Chinese are good at cost reduction and efficiency improvements. Because of that, I doubt they will ever use as much energy per capita as Americans, which is good because there are four times as many Chinese as Americans. However, at half the energy consumption per person, China would use twice as much energy as the US, and they could hit that point by 2020. After that, they may slow down.

This is something of an historic moment. A few years ago, China passed the US as the world's top CO2 producer, and now it is the top energy consumer. At current growth rates, their energy consumption will be double that of the US in another decade. They're now the 900-pound gorilla in the energy markets.

And the US is now the slightly slimmed down version of the 300,000,000 lb gorilla, after all we are using a couple Mb/d less oil than we were in 2008 due to demand destruction. How about slathering some more lipstick on that pig there, eh? It'll make it look a lot slimmer...

Population of China: 1,324,655,000 - 2008
Source: World Bank, World Development Indicators

Population of The US: 307,006,550 - Jul 2009
Source: U.S. Census Bureau, Population Division

So China has one billion more people than the USA and only now has it surpassed the US as a top energy consumer, that despite the fact that they manufacture all our junk for us...

Any chance we could get a little sense of perspective here?

Once again the common mistake of measurement. Looking at the scalar value rather than the vector, or rate of change. "It's not the fall that kills you, its the sudden stop at the end". The U.S. may still be the obese 300,000 lb gorilla, but it is an empire waning, while China is waxing.

I have to admit, I had a hard time believing those that forecast the rise of the Dragon in the East. How is it possible or sustainable? I do believe the last point will be their undoing because it is not sustainable; and they too, will fall victim to the basic physics of rate of change.

Regardless, Canada, the mercenary whore-mongers that we are, will sell to the next guy down the block. Harsh POV? Contrary to our national image of good-natured and polite, when it comes to international commerce, Canucks are some of the meanest mercenaries going. Our oil will flow south or east, we care not... but don't come for our water!

Once again the common mistake of measurement. Looking at the scalar value rather than the vector, or rate of change. "It's not the fall that kills you, its the sudden stop at the end".

Waxing or waning, my point was that it shouldn't be very surprising that 1.3 billion people might end up consuming more energy than 300 million. What should jump out at us is that it takes 4 Chinese to consume as much energy as 1 American...

Okay, well if you want a little sense of perspective...

Today, China is the 900-pound gorilla, and the USA is now an 899-pound gorilla.

A decade ago, China was a 450-pound gorilla, and the USA was the 900-pound gorilla, but China has been growing very fast, while the USA hasn't been all that healthy. A decade from now, if things continue on the way they have, China will be an 1800-pound gorilla, but the USA may not be any heavier at all.

If you are an 899 pound gorilla, you don't want to be locked in the same cage as an 1800-pound gorilla because the supply of bananas is strictly limited. You may have to go on a starvation diet so the 1800-pound gorilla can have all the bananas he wants.

Does that put the whole problem in perspective? It's all about increased demand for scarce resources.

November 2007 revisited
The article Has peak oil arrived? reminded me that today I was throwing away old newspapers and stuff and I found a cutting I'd kept all this time. It is an article by David Strahan in The Guardian $100 oil: the terrible truth.

Before the Crash and The Great Depression 2.0 but a clear premonition of the dangers. Bush was President, Blair was the Prime Minister and I think Lord Browne was the CEO of BP, Zapatero happily saying that Spain has surpassed Italy and France was in sight --in GDP I mean. Everybody living in a cloud of f....

As the price of crude oil sets records almost daily, the British government remains stunningly complacent. With the $100 barrel a real and constant threat, the prime minister's website blithely proclaims "the world's oil and gas resources are sufficient to sustain economic growth for the foreseeable future". Officials refuse to define what is meant by "foreseeable", but it is clear they suffer from extreme myopia, or worse.
All the evidence suggests we are rapidly approaching "peak oil", the point when global production goes into terminal decline for geological reasons. The industry consensus is that world output, excluding that from the Opec producers, will peak in about 2010. It is also widely agreed that Opec has grossly exaggerated the size of its reserves, meaning that global output must also peak soon.

Oil executives have traditionally avoided talk of geological constraints - no doubt mindful of the value of their share options - but now even they admit the industry is in difficulty. A growing number believe output will never exceed 100m barrels per day, compared with 86m today. At present rates of growth, demand will hit that ceiling within about a decade.
The UK position relies on the International Energy Agency, which forecasts oil production rising to 116m barrels per day in 2030. But the model that produces this forecast relies in turn on an estimate of the total oil available published by the US Geological Survey, which is demonstrably wildly overoptimistic.
For the US survey numbers to come true, the world would have to discover 22bn barrels of oil a year between 1995 and 2025. So far we have discovered just 9bn per year, only 40% of the predicted amount.

The comments to the article show that most people were living in denial back then same as now.

The WaPo has an interesting comment on their 44 blog about a group of Gulf Vets who are running adds about energy policy. There's a link to a YouTube copy of the add given in the post, for the curious.

Fox rejects ad that links oil usage to military deaths

Of course, one would expect that Faux News would not support an add which questions the cornucopian ideas of the Repugs. Perhaps Faux News would like to do an "in depth analysis" of the reason the US invaded Iraq, even though it's a bit late. Maybe the Faux people could hire some of those defense contractor analyst what the WaPo is currently featuring in their series on Top Secret America...

E. Swanson

I worry not so much as to whether or not "Peak Oil" has arrived, I contemplate what crises will prompt our government to finally fund programs that will help end our addiction to foreign oil. Usually, i am against Government Programs of this type, but in this case it's a matter of National Security, so I say let's fund it with no less vigor than we funded the Manhatten Project. The goal here is to come up with an alternative to power our autos, for this would virtually eliminate imports, and the only potentially viable solution I see is electric power. Specifically, electric motors and auto technology are well developed - and we know how to generate electrical power via coal and nuclear - what we don't have is cost-effective "Batteries" - and Battery costs have always held us back from developing viable electric autos.

If we were really serious about breaking our addiction to foreign oil, we'd be spending about $100+ Billion/Year developing Battery Technology - even if we had to find the savings by ending the wars in Iraq and Afghanistan. Of course...I can dream can't I?

Jim -- I get what your saying. But my concern is that even if the gov't can fund the development of a "majic bullit" the economy will have neither the time nor capital to scale it up to a meaningful level. I'll tease you a little: the Mahatten Project worked great. But they built only a handful of functioning devices. How well would the project faired if the goal was to put one nuke in every household? Not so well, eh?

But of course, the goal of 1 KW of PV and four to six good Heating Panels on every roof would make an actual dent in our Foreign Debt, and requires merely a much more reasonable level of industry and job growth...

I know, I know, solar just isn't realistic.

(Not saying my snark as if that's YOUR position.. but I still rolled my eyes like a teenager, just for effect.)

You will have a massive political problem to consider. Let's say 'Presidential Candidate A' follows your recommendation. That leaves the door wide open for 'Presidential Candidate B' too claim that 'Presidential Candidate A' want to bankrupt the country with massive taxes, deficits, and regulations.

Presidential Candidate B will claim we have plenty of oil right here and that it's over regulation that holds us back. The candidate will bring out oil executives to back the claims. Then enter the drill-baby-drill crowd.

We're out of money.
This is a big part of the problem we're facing.
For sure, the wars have to end. Regardless of their original merits (or lack of), they have to end.
Even if this happens, I'm not so sure it isn't already too late to turn things around.

This is why I, for one, am very much against any further tax and spend schemes. We're not going to bail our heinies out of the jam we're in by making ourselves poorer and government richer. It's too late for that (doubtful in my mind that it was ever early enough). Our government has demonstrated to my satisfaction that they are too corrupt and too incompetent to be trusted with any more hard earned money from honest people. We're going to need every penny we have going forward to just cope with the mess created already.

Agreed. The federal government is already running $1.5+ trillion deficits and is officially expected to continue for the next few years. This is even assuming the economy doesn't fall back into negative growth.(recession/depression) If the deficits continue or grow as I expect, the economic prospects of the US will to be very dire indeed.

The economic prospects of the U.S. will be very dire indeed, but mainly because of Peaking oil production and the Export Land Model. The Fed can always "print" more money--but it cannot print barrels of crude. Thus I see financial constraints resulting from an end to economic growth, and the end of economic growth will be due to Peaking and subsequent decline of oil production.

We'll only be able to recognize Peak from some years distance in the rear view mirror. My guess is that we are not quite yet at Peak but will be within four years.

I do not mean to minimize the importance of finance and the evil effects of too much debt, but IMO the financial problems primarily reflect what is going on in the "real" economy of bushels of grain, barrels of oil, tons of steel, and so on.

I believe peak oil is what will prevent the world economy as a whole from growing initially, but will then cause a series of recessions/depressions in a few years, making the financial/fiscal situation that much worse.

There you go trying to sell your clueless idea of inflation again.

For one thing we already have had MASSIVE inflation in the only form possible which is credit/debt, and are now just in the begining stages of deflation which ALWAYS comes after massive inflation.

Second of all, if the PTB try and inflate via "printing" (which again is not possible but if...) oil would respond immediately by soaring to $200 and beyond killing any economy that might still be alive.

You really should read a book.

I understand your frustration, but please lay off the personal attacks.

First of all Don Sailorman can explain his position as well as anyone, and I really doubt he needs to read any more books to do so.

Secondly, the monetary history of the US in the last 100 years has been one of inflationary policies. For example, it is quite frequently overlooked that the 1930s Treasury and Fed resorted to very dramatic actions, such as a 75% devaluation of the dollar, which resulted in basic commodity prices such as oil also rising about 75% in about a year or so.

Thirdly, the Fed can create almost any amount of inflation that it wants to, and to repeat myself, there is a 100 year history of inflation that says so. However inflation will not solve any economic problems in the long run, which is the point I think (but I am not sure) you were trying to get at.

The answers to the PO questions have been right in front of us for many years. We just don't like it so we reject them at a pyschological level.

We, the USA, get poorer. No great war, no great calamity, no great social change, no great invention of any kind to beat the physics problem. No great switchover to an "alternative" set of fixes to preserve our way of life. We will just spend more & more of our income for a less & less affluent lifestyle, that's all.

Our subconscious mind says "Wait a minute. That would mean that we just get really poor and nobody fixes it. No, that does not compute." But it DOES compute. It has computed throughout most of the world for most of human history. It still computes on most of the earth today. This IS the answer, we just don't like it.


The US will have to adapt to the difficulties ahead of us. If we don't this country (including the rest of the western world) will collpse and the average person will not know what to do or why they are in that situation.


I agree 100%...but what to say? I mean, the causes of our current predicament are both complicated and generally not even addressed by the MSM. So...how are most people to be enlightened in a timely manner...and would they have the time and focus to even listen to the explanations - much less the possible solutions?

Sadly there are a lot of many people who would call you crazy for just saying saying or warning them something that is a real possibility. What I think could be the best solution is simply join certain activities that you find sustainable, like vegetable gardening in your yard or community. Using clothes lines to dry clothes and anything else you can thing of. Many people today want a "green lifestyle", so if you could provide people these tips and they would be well on their way to preparation. Just don't try to mention the phrase "Peak Oil." The term today has become almost a dirty phrase today in MSM and will turn people away.


I agree 100%, and even the people you can reach may not be able to handle the truth. For example, my cousin (a retired banker), a friend (Financeer) and I (pretty-good at math) recently explained to a life-long bank loan officer the mechanics of money creation, and the subsequent ramnifications debt securitization and it's long-term economic consequences. He believed us. It had never occured to this guy that via his book-keeping that he was creating money - nor had it ocurred to him what damage the securitization process was doing to our country. In the end...he agreed we were right, but said the topic was "Depressing" and "There was nothing he could do about it anyways". Nevertheless, he now understood why we "were not mad" for predicting - and telling him - that the banking system would eventually collapse ever since 1999 (Gramm–Leach–Bliley Act)....but he just didn't want to here about it anyways.

There ya' go. He knew the truth...but turned away!

On a personal note...how about this Philosophy of Yankee Frugality: Use it up, wear it out, make it do, do without. I like that, too.

Perfect Philosophy!

The positive outlooks are nice but I don't think they will fix the long term PO-induced problems. I see nothing that will really alleviate the severe loss of lifestyle affluence that PO will likely bring the USA.

The circumstances for many US citizens changed when the Great Depression hit. We could call it a bunch of euphamisms like "adjustments in lifestyles" or whatever we want. I'm sure they conserved more after the Depression hit. I'm sure they invested in alternative ways to do all sorts of things they had been spending more money on before then. But still, by far the most concise way to describe what happened in the 1930s does not sound as sunny - People just got poorer.


I know that its going to be much more than "adjustments in lifestyles". (whole governments could collpse) What I was saying was that you have to prepare people the most you can by encouraging them to live what is likely to be a world with much less oil availability and to not rely on oil dependent systems for survival. If you tell people the problem of "Peak Oil" directly (as everyone here well knows) you will have basically chased them away because they are thinking either "you're crazy" or they feel overwhelmed and think "its too big for me". Its better to make steps in the right direction than no steps at all.

On a personal note...how about this Philosophy of Yankee Frugality: Use it up, wear it out, make it do, do without. I like that, too.

Nice! :))

And I think we are doing it right now. We are using up all the oil we can get our hands on, after that we will move to next stage - reuse everything we can until it wears out and can't be used anymore and then probably skip to the last phase and do without. :P

Has Peak Oil Arrived?

Perhaps a better question is - Why is it so easy for the peak oil charlatans to convince a wide swath of the public that we are at peak oil?

I guess one of the answers is that the public isn't very bright. And it's an easy trick to show, because production is always increasing. We're always at peak. Right at the edge ready to fall off that cliff. I think I'll take a nap now, wake me up when production actually goes into decline. Then I might believe it. Maybe.

i googled would oil production. first graph that came up looks like this:


Great find. So back in 2008 it looked like we were at peak ready for that big drop off the cliff. 2 years later we now know that big drop off never happened, and production has again increased. Thanks for proving my point.

true, two years is like an eternity.

False statement. No factual basis to support it. Raw assertion.

Ron posts the production for the last 5 years in a post below here. Production is, for all intents and purposes, flat for the last 5 years. While it has not yet fallen, it has also not grown. Five years is a pretty long time for no growth, particularly when it includes high GDP growth years like 2005-2007.

You are wrong again Cr5. You specifically stated that: "And it's an easy trick to show, because production is always increasing." Your point was disproved and you think it was proved? Wow, what a bright boy!

Production dropped in 2009 and has not and will not rise back to those 2008 levels. The IEA says world production was down 575 kb/d in May and down another 255 kb/d in June. It really don't look too good for those bright boys who says it is an easy trick to show that production is always increasing.

Would you mind showing us that trick?

Ron P.

Geez, I don't know, what does a peak look like when you are on top of one? A flat, level, but short space?

My corollary to Bartlett's "The greatest shortcoming of the human species will be a lack of understanding the exponential function" is "The other complimentary shortcoming is not understanding the time scales involved".

We see this every, single, frickin' day. "Oh, it's not immediate and right in front of my eyes so I guess its not true!" Financial world and destructive decisions made on a quarter by quarter basis. What would the world look like if public companies were forced to make forecasts and decisions on a year by year basis? A whole different I'm sure...

"Which is like saying the sun might not be real, because last night it got dark." -- Bill Maher

I guess one of the answers is that the public isn't very bright. And it's an easy trick to show, because production is always increasing.

So peak oil people just too stupid to realize that oil production is always increasing!

World crude oil production in thousands of barrels per day according to the EIA:

2005  73,723
2006  73,457
2007  72,987
2008  73,711
2009  72,248
2010  73,458 average for the first four months.

Right now we are still below 2005 and 2008 and are right at 2006 production level. And the EIA and IEA are predicting falling production for the rest of the year. 2010 will wind up way in third place for the peak year. And we are so stupid to not realize that oil production is rising?

Wow, aren't we the dim wits? Or are the not very bright ones those just not bright enough to realize that world crude oil production has stopped rising? I mean those that are unable to read the statistics published by their own government here: International Petroleum Monthly

Ron P.

The only time that production rose was during 2008. However that was only possible with $147+ oil, nearly crushing the economy. I am very sure that today's economy couldn't tolerate such prices now.

Right now we are still below 2005 and 2008 and are right at 2006 production level.

I think that the 'noise' of that set of years makes it not easy to see.

I think the production would have to drop to 71k (71,000) for the impact to really make an impression on a layman, like myself.

It is hard to see even a seventy-ith drop really stirring people up, unless they could realize that it was the first time ever that production had dropped to such a level, and was the start of a consistent downward trend.

Until then, I think things stay easily shrouded to those that do not believe.

I think that the 'noise' of that set of years makes it not easy to see.

The noise, Mr. Flash, is in the monthly data. There is no noise in the yearly data. Clearly the peak year was 2005 though 2008 was very close.

I think the production would have to drop to 71k (71,000) for the impact to really make an impression on a layman, like myself.

I do not really give a hoot whether you are impressed or not. So far the peak was in 2005 and there is no way 2010 crude oil production will surpass that of 2005. And no one, absolutely no one, has said we are on the downward trend right now. We say that we are at the peak right now. That is we are on the peak plateau.

I don't expect the drop off the plateau to come before 2012 or perhaps 2013. The point is we peak oilers have been right so far and the peak oil deniers have been dead wrong. They said oil production would keep rising. Obviously it has not. We are at peak right now, and have been for almost six years. How can any yahoo claim that peak oil is a myth when 2005 oil production has not been exceeded?

Well, of course any yahoo can do that. That is what makes them a yahoo. ;-)

Ron P.

I do not really give a hoot whether you are impressed or not. So far the peak was in 2005 and there is no way 2010 crude oil production will surpass that of 2005. And no one, absolutely no one, has said we are on the downward trend right now. We say that we are at the peak right now. That is we are on the peak plateau.

Peak...again...peak plateau....I say it all the time and no one believes me either, its OVER baby! Been over for years. The key is, when will anyone NOTICE. I can run down to the corner convenience store this evening and fill up a tanker truck of diesel or gasoline if I wish. At least when global peak in 1979 happened we got some rationing in Pennsylvania out of that one. This peak, or peak/plateau, has been a bust as far as excitement goes. Maybe the next one will be better?

Your example doesn't challenge Peak Oil, you know.

If we're at 'The Mountaintop' of PO, then of course you've got plenty of oil products you can buy. The PEAK means there's as much of it around every day as there'll EVER be..

Just show us how you can walk straight along on your reserves like they're solid ground under your feet. Wiley Coyote usually can pull it off, for a few steps.

Your example doesn't challenge Peak Oil, you know.

Which example? And who said anything about challenging peak oil? If you stick with a strict definition of peak, its a given, and everyone admits it. Its the hysterical consequences where the rub is.

Just show us how you can walk straight along on your reserves like they're solid ground under your feet. Wiley Coyote usually can pull it off, for a few steps.

They aren't my reserves, and they've been as solid if not more so than the bell shaped curve thingy itself since about 1859, so call me crazy, but I'll go with historical precedent on this one.

The plateau idea is not helpful.
Peak [anything] is really a demand based concept.

The EIA gives 2007 as the liquid fuels peak.

What we have is that the OECD liquid fuels demand peaked in 2005-6 and are now in slight decline and the non-OECD growth has matched that decline going up. The OECD is down 4 mbpd since 2006 and non-OECD is up 4 mbpd.
I would say that more efficient OECD economies are reducing use thru the recession and new more efficient technology, but that gets harder over time and at some point the economy will get stronger.

The question should be how long non-OECD economies grow before they 'peak'.
China has just shot past the USA in energy consumption unexpectedly.
I can imagine that liquid fuels demand could grow past 86 mbpd again for a while.
Including NGL and biofuels, the new 'oils'.

It doesn't matter what liquid fuels are made from.


The plateau idea is not helpful.
Peak [anything] is really a demand based concept.


I suppose if there is no unsatisfied demand then the possible production rate is irrelevant, but as soon as people are unable to obtain as much of a resource as they could use it's production side.

If demand exceeds supply prices will rise and high prices will reduce demand directly or by causing a recession. There has been no recession in China, they continue to grow.

And the prices are determined by *both* demand and supply, so you can't just handwave supply side issues away.

Sure, demand contributes incentive to attempt to produce more of a resource as price increases, but sometimes no incentive is enough to bridge the gap between what people want and what can be done.

The plateau idea is not helpful.
Peak [anything] is really a demand based concept.

While I certainly agree that Hubberts work didn't say much about a plateau, his concept certainly was supply side focused. Do you have a reference where he analyzed demand, or is this more of a modern concept within the peaker community?

The problem is not in knowing after the fact. The problem, as DOE studies have demonstrated, is that if we wait until after the fact to respond to peak oil, then there is likely to be very harsh economic and social consequences. Intelligent people might want to address that before it became a serious problem rather than after the fact. Telling me I have a fire in my house after it has started is useful information but avoiding the fire entirely is a lot better outcome, isn't it?

"Peak Oil" in terms of volume only arrives when we want it to. I mean, we could easily scale production up to 100,000 Bbl/Day - if we wanted to suffer the dollar cost associated with that scale of production. Oil would be mighty expensive if we ramped to 100,000 Bbls/Day!

What I figure will truly signal "Peak Oil" is the economically available alternatives that may (hopefully) become available soon. Anyways, try thinking of it like this: we didn't leave the Stone Age because we ran out of Rocks...and we didn't exit the Bronze Age because we ran out of Copper...and we didn't exit the Iron Age because we ran out of Iron...and the same will happen with the Oil Age.

Well right now crude + condensate production is about 73.4 mb/d and all liquids production is about 86 mb/d. If we only produced 100,000 barrels per day we would be in bad shape.

But I am sure you meant 100,000,000 barrels per day not 100 kb/d.

But that is a joke, there is no way on this earth that we could ramp up to 1 mb/d. Just who would do that ramping? Peak oil is a geological fact.

True, more drilling would produce more oil but nowhere near one hundred million barrels per day. And if we did do more drilling, mostly infield drilling, then that would just make the decline much steeper.

But if you really believe we could ramp up to one hundred million barrels barrels per day, we would all love for you to tell us which nations would do all that ramping up and by how much each.

Ron P.

Iraq has the most likely potential to substantially increase production (1 mb/d?) but I have a hard time believing its going to be anywhere close to the claimed 10 mb/d in new capacity. Even if you took that unlikely position, world total liquids production would still be less than 100 mb/d at around 96 mb/d

We have thrashed this Iraqi straw for months but it bears repeating that even the IEA does not believe that crap about them increasing their production to 12 mb/d which they claim. The IEA puts their production at about 3.5 mb/d in 5 years. That would be an increase of 1 mb/d in five years. I really don't think even that is possible.

And it is interesting that the IEA sees Iranian oil decreasing at about the same rate as Iraqi oil production is increasing so the net gain of the two combined is close to zero. Those expecting Iraqi production to delay peak oil are sadly mistaken, at least according to the IEA.


Ron P.


I meant 100 MBbl/Day - you are right. And I know we could do it if we wanted to pay a ruinous economic and environmental cost to do so. We'd be destroying the productive capacity of our resevoirs left-and-right via over production, and we'd shortly have the devil himself to pay in the cost of incredibly-high oil prices. But...we could do it for a short while!

BTW...here's some world-wide oil production data you might enjoy and find informative - at least I hope: http://www.eia.doe.gov/aer/txt/ptb1105.html.

Thanks but those numbers are a tad bit dated. Try these:


Looks like production is setting new records. So much for the "Peak Oil" theory. Again.

And quite a bit different from the stories we read on The Oil Drum:


It sure is fun to read "scary" stories though isn't it?


Good Charts! But...this is not what I was referring to. Specifically, I was referring to "Crude Oil Production" - not "International Crude Oil and Liquid Fuel Supplies" as detailed by your referenced charts. Nevertheless...Thanks!

Looks like production is setting new records. So much for the "Peak Oil" theory. Again.

You are looking at all liquids which includes NGLs, (bottled gas). Crude oil + Condensate peaked in 2005 though the monthly peak was in 2008. The IEA has said that May liquids production was down 575 kb/d and June liquids production was down 255 kb/d. So the high levels in the first four months of this year are now history.

And look at your chart Nacm, even the EIA is predicting non-OPEC liquids will peak in 2010. Non-OPEC production, according to the EIA and the IEA, will be down next year. They are expecting OPEC production to pick up the slack. Many other observers do not believe OPEC will increase production in 2011 however.

And world production is not setting any new records! Production was higher in 2005 and 2008 than this year.

Can peak oil deniers not read simple data figures? Try it again Nacm. Try Here!
International Petroleum Monthly
Click on 4.1d to get the annual data for 2005 thru 2009 then click on 1.1d to get the average for the first four months of this year. But just in case you cannot read the data I have copied and pasted it below.

2005 73,719
2006 73,429
2007 72,987
2008 73,652
2009 72,248
2010 73,458

Don't see any new records there. Peak oil is still in the past.

Ron P.

I agree with Ron.

We could theoretically ramp up the oil production, but just as much as spare capacity of all the producers, which is... not so much. KSA is famous for its happy talk, like "Oh, we could produce 12 mb/d, if we really want to", but currently they produce how many..? 8..? So in the best case they have 4 mb/d spare capacity.

Frankly, I can't believe that. They peaked. Or soon will, but the point is, they will have hard time just to keep the production steady. Maybe they could ramp it up, but not without damaging their already quite damaged/depleted fields and even that just for the short time.

To reach those 100 millions, we would need 26.6 mb/d additional capacity. KSA would supply those 4, Iraq in 10+ years (development of fields takes time) those fictional 10 mb/d that PetroGuy mentioned and I have hard time, as he does, to believe that, too. So we have 14 m/d of new capacity, but who will add the rest 12.6? Russia? Hardly... Canada maybe could do some magic with their oil sands, plus 1 mb/d, but that's it.

I'm just saying that

"Peak Oil" in terms of volume only arrives when we want it to.

is maybe partially true, but we could just postpone it (prolong the plateau) for a few years, but then get much steeper downslope for our foolishness and even maybe sudden collapse of fields. Like Cantarell...
Personally, I wouldn't do that. :P

Has Peak Oil Arrived?

Perhaps a better question is - Why is it so easy for the peak oil charlatans to convince a wide swath of the public that we are at peak oil?

Sorry cr5, but I'm with the peakers, it happened years and years ago.....the Prophets Of Peak have said it was so...and the religion requires that they must not be questioned.




Whats amazing is that peak oil happened years ago and the consequences have been so earth shatteringly horrifying that the charlatans can still be called charlatans with a straight face!

Lets not forget what other Prophets Of Peak said it was supposed to look like...


So, RGR2...

Were you born a troll, or did you have to work at it?

American by birth. Texan by the grace of god. Oil engineer through natural inclination and scientist by near dumb luck.

Never did get no trainin' in trollin.

You're alright in my book. Hey, my best friend is from Houston (and me a yankee from NH) But come on... "charlatans" "prophets of peak" etc...

surely you must have had _some_ trolling training!


I like "Prophets of Peak" myself, it fits right in with the idea that peak oil is more religion than anything else. Peakers (once known as "running outers") have been doing this since 1886, earlier even if you use advertisements as a reference. But I like 1886 because it was by a legend in the oil community at an actual conference rather than just some snake oil pamphlet.

I'm currently trying to find the original quotes for the 1917 "running out" episode, another 7 years arguing about this stuff and I'll be able to use it as a "100 Year Anniversary of Running Out".

Well, regarding all this peakishness, seems we're gonna find out in our lifetimes (don't know how old you are, but I am a spritely 55).

I will only say that trend is not destiny.

Keep 'em flyin'!

Well, in 1886 JP Lesley thought his kids would certainly see the end of oil, particularly considering how wasteful everyone was being with it. Certainly the idea that we'll see running out or peak in our lifetimes is a reasonable guesstimate.

My actual opinion on the topic is that peak oil consequences, at one level or another, are actually a prerequisite for change. Lets face it, 1/2 of all humans are below average, and require being smacked in the head with a 2X4 to pay attention to the mortgage papers they just signed, let alone being forced to change the fuel they use in their transport. Plug in my car! Never!

But smack'im in the head with a decent $6/gal gasoline price...well.....the last time it hit $4/gal here in Colorado you had to wait in line 6 months for a Prius. People will do the same for Honda's new PHEV, or the Volt, the Nissan Leaf, or what have you.

I was born an oil guy, and I drive a hybrid just because it makes sense...well...that and I roadtrip alot, or looking for shortages at stations across the country because of the terrifying effects of peak oil in 2005!

And there you find the lack of engineering judgment and critical thinking... If you road trip a lot you wouldn't buy a Prius (and there I am using a noun as a verb). They're efficiency is in urban roadways. If you wanted road trip efficiency you would have bought a VW diesel - Jetta or Golf.

Texan by the grace of God, c'mon! Yes, you are blessed to be born in a state acquired by thievery and bloodshed, framed by a heroic lot that were too stupid to leave the Alamo when they knew a vastly superior force was descending upon them. Maybe they should modify the state flag and show the Lone Star spinning at about 500 rpm.

Its too bad because many good things have come from Texas, and not so many good things. But, a good part of Little Feat are Texans, so I'm giving a lot of leeway here. Sorry to slam the great state of Texas (because I am a Jeffersonian at heart), but you gotta tone down the attitude. Perhaps a good 'ol Texas saying applies here, "All hat and no cattle".

And I live in cattle country BTW...

And there you find the lack of engineering judgment and critical thinking... If you road trip a lot you wouldn't buy a Prius (and there I am using a noun as a verb). They're efficiency is in urban roadways. If you wanted road trip efficiency you would have bought a VW diesel - Jetta or Golf.

There is another quality to an automobile...its called reliability. VW has a difficult time with it, including, but not limited to, clutch issues, hideously bad service reputation, clogged MAF sensors, blown turbo's, CEL's on a weekly basis, window motors, water getting in the cabin side of the firewall, and just about every electrical glitch known to man. I need something which actually completes the road trip. I've got friends who bought new TDI's who couldn't even get home without their CEL coming on. And I don't have a Prius, too much compromise for its efficiency.

Perhaps a good 'ol Texas saying applies here, "All hat and no cattle".

And I live in cattle country BTW...

I like that one..

I dunno, my 10YO Beetle TDI is a bit glitchy these days, but just keeps going.

[False] "Prophets of Peak" ???

Are you serious? A religion?

Does someone have to whack you behind the head with a 2x4 before you realize we are Lemmings on the Ledge of the Continental Shelf?
Sucking up the last of the Nectar?
Crowding ourselves in toward the Big Fall?

Even the Great Tom Tom realizes something might be amiss in his flat and crowded Cornucopiastan.

It has been suggested that I not post pictures here.
If you want some visuals to go along with the above, try this.

p.s. CORRECTION: Sorry ReserveGrowth guy, I was reading from bottom up. Didn't appreciate your sarconol re what cr5 was saying upthread about snoozing on the edge of the cliff

Could you try being less abrasive and less repetitive in your posting? Just tone it down a little, and maybe people would stop thinking you're a troll.

I am sure you are aware that there is a long list of oil related web sites that RGR has been banned from, or had his posting rights restricted.

I am sure you are aware that there is a long list of oil related web sites that RGR has been banned from, or had his posting rights restricted.

And I am more than happy to discuss why, certainly such opportunities are not available at the sites which heavily censor members who disagree with the groupthink. But I'm betting Leanan is familiar with my history.

Well, you could start by not tarring all "Peak Oilers" with the "Collapser" brush. Some of that tar might come off on you if you apply it too liberally, donchaknow.

Well, you could start by not tarring all "Peak Oilers" with the "Collapser" brush.

I believe that within the peaker community there has been a heavy tendency towards revisionist history. It is my opinion that this has happened because peak oil happened, and those consequences did not materialize.

Let me demonstrate.

Among the Prophets of Peak, can you find one which claimed, contemporaneous to peak itself in 2005, the claimed consequences were a credit crisis predicated on idiot American consumers and housing values, a recession which ended within a reasonable amount of time, or demand destruction on an unprecedented scale without even consistent high (real) prices.

Obviously, years after peak happened, it is not difficult to look around the US and world, and decide that the more severe consequences (being polite here) didn't work out so well, and now claim that OBVIOUSLY peak oil is a long, slow slide into (fill in your favorite peak-lite scenario).

I am willing to be proven wrong of course, and will assign higher credibility to anyone you can find who saw these things in advance.

I'm not picking on the Crashers, beyond noting that they existed and are part of the problem, the problem being, the boy who cried wolf scenario. Adding one more to the list just makes it that much more difficult to be taken seriously when discussing these issues.

The problem with predicting the future is nobody knows what's going to happen in detail.

You are apparently a very religious person who has trouble understanding that a lot of us just don't think in religious terms.

We don't do "prophets", we do "speculation".

There are a few very verbose exceptions, but the vast majority of posters here aren't looking for Truth, just digging at an interesting and perplexing conundrum.

Are you really prepared to be wrong? Or are you gambling that nobody has the time to pick up your gauntlet?

The problem with predicting the future is nobody knows what's going to happen in detail.

You know it. I know it. Either of us may be intelligent enough to offer up, with our prediction of the future, something along the lines of, "a 50/50 chance". "Nearly no chance." Perhaps a "Almost certain."

When someone claims that the walmart trucks will stop running within a matter of days of peak oil happening....with none of the caveats previously mentioned...well....maybe they shouldn't? Can't disagree with that.

You are apparently a very religious person who has trouble understanding that a lot of us just don't think in religious terms.

I haven't been to a church in this century, and the last couple decades of the last century, so my knowledge of whatever passes for faith in that regard nowadays is probably lacking. But I am familiar with zealotry.

Are you really prepared to be wrong? Or are you gambling that nobody has the time to pick up your gauntlet?

I am a scientist. I have been wrong so many times in my career I've lost count. But you know what Edison said about building filaments for lightbulbs.....

OK then, as someone with a scientific bent myself I have found that the line of argument that you have been taking recently is non-productive.

There are people around these parts that do seem to match your description, but they are only one note in a chorus of voices on the topic. Posting generalized attacks against a poorly defined (in your posts) set of ideas named so as to handily encompass a much broader spectrum of that chorus than the people you actually have a beef with is only going to create hard feelings against you among people who would otherwise support your ideas.

It can actually be productive to target particular, narrower, ideas that you find particularly wrong-headed. It helps to focus your arguments and avoids diffusing your efforts railing against the tides.

Farmers market reaches out to food-stamp recipients.

Interesting program and definitely something for the eat local crowd to think about.

Not a bad idea. Farmers' Markets are great places to buy local and fresh food at. This could help the farmers expand their market to become a larger share of society's diet and scale back on the big food industry and their dependence on oil.

As I have said on several occasions, the only way for any meaningful increase in local production it must be creatively and substantially subsidized.

Well, it's now official....

New transmission route explored by N.B., N.S.

NB Power and Nova Scotia Power are exploring the possibility of building a new 500-megawatt transmission line connecting the two Maritime provinces.


The additional transmission link could open up the possibility to wheel power through the region from the proposed Lower Churchill Falls project in Newfoundland and Labrador.

The N.L. government is hoping to develop the $6.5-billion Lower Churchill hydroelectric megaproject but it is looking for a way to transmit the power into hungry markets.

Nova Scotia's premier said this new power line could assist in any future negotiations with Newfoundland and Labrador.

"There are ongoing negotiations [with the N.L. government] but this puts you in a position to be able to facilitate that kind of eventual agreement," Dexter said.

See: http://www.cbc.ca/canada/new-brunswick/story/2010/07/20/nb-nbpower-nspow...


Think-tank urges N.S., N.B. to co-operate to improve power grid
Premiers, power officials to make announcement today

FREDERICTON — Improvements to interprovincial power transmission infrastructure in Nova Scotia and New Brunswick would be a boon to planned and proposed renewable projects, says the head of a regional think-tank.


Cirtwill said he also believes development of the Lower Churchill in Labrador "will at least be mentioned" during the news conference, which he expects Nova Scotia Premier Darrell Dexter will also attend.

"If you invest in transmission infrastructure, it makes all of these small five-, 10-megawatt projects, a little wind farm here, a little dam there, much more viable because they have a low-cost way to get their electricity to market," he said.

Hydro-Quebec also has another 6,000 megawatts of power planned for the coming years that could be pushed into Atlantic Canada.

See: http://thechronicleherald.ca/Canada/1192797.html

With the possibility of accessing up to 6,000 MW of hydro-electricity via Hydro-Québec and an additional 3,200 MW by way of Newfoundland and Labrador, the energy picture in Atlantic Canada is looking a little brighter.



Heard the announcement on the car radio driving back from Truro this afternoon.

Premier Dexter sounded positively enthusiastic about a renewable energy future.

Pop the corks. He gets it.

Here's to the Labrador current (electrified) coming ashore to the Maritimes.


Hi Tom,

I know it's still early in the game and this is simply a statement of intention, but I think it bodes well for our future and it makes the NS-NB alternate route that much more viable. Five hundred MW of imported hydro would effectively displace three-quarters of NSP's coal-fired generation and reduce our province's CO2 emissions by four to five million tonnes annually; in effect, 5 tonnes for every man, woman and child within our provincial boundaries. Let's make it happen !


I've stated some of the numbers before, and if the planned expansion of 3.2 GW at $6.5 billion is the figure, they're lying through their teeth. Double that number. Unless the increase in generation is within an existing dam and powerhouse structure, you can't build new hydro for much less than $4 million/MW. 3.2 GW will be $12 billion.

But, it may be a time for bold measures. Upon looking at the map of the Quebec and Labrador area with all the water and potential generation, it was a "holy criminy!" moment. NB and NS may get entrepreneurial and develop a merchant transmission system to supply the eastern seaboard.

As in BC, I really wish these systems and developments weren't driven by politics. How different was it when my great-grandfather stood upon Signal Hill and conducted the wireless experiments with Marconi? Maybe I'm romanticizing - sure of it actually - but using the public energy systems to wield here and there for short term political gain ought to be punishable by being forced to watch a Woody Allen movie marathon. One way or another, you'll go mad...

I fully agree, BC_EE; the final price tag for the Lower Churchill Falls development is likely to be in the range of 12 to 14 billion.

We Atlantic Canadians desperately need to wean ourselves off coal and oil and no doubt most local politicians appreciate that the Lower Churchill Falls can help advance that goal. Delivered costs will be high, but the benefits are well worth it.


Does anyone know what the API inventory report showed? Waiting for the DOE report tomorrow.

Not sure if it's been released yet. They always wait until after close of trading.

According to Bloomberg:

Crude stockpiles fell 241,000 barrels to 353.3 million last week, according to the American Petroleum Institute.

Last week showed a 1.74 million barrel increase, so this reversal.

Thanks Leanan!

I have been waiting for the inventory reports to reflect my opinion that the world oil market is beginning to tighten. One indication being lower imports. We will find out if the DOE report tomorrow further confirms the API report and my thoughts on the oil market.

The first link at top, the one about Saudi king ordering to stop all oil explorations, well, thats it, its official, peak oil is here. To control price of oil, a head of state can order to stop or reduce production but it makes no sense to stop oil exploration except to save money spend on oil exploration itself which is not the case here, the king explained why he gave that order, he said its to save oil for future generations, he didn't said its to save money spend on oil exploration. Nobody, after reading this, in his/her right mind, can deny peak oil. You wanted an official declaration from govt of an oil producer, well the king of saudi arabia is the highest level head of state of saudi arabia on earth, a thousand times more high than a president who is elected for a short term and is subject to dismissal by a single vote in assembly, saudi arabia is the world's largest oil producer (with russia a close second and occassionally first) and saudi arabia is the world's largest oil exporter with a wide lead on the number two. Also, saudi arabia is the only country in world that claims a spare capacity. The oil age is officially over, the breaks have already been applied, its the momentum that is moving us forward but thats not going to take us much further much longer.

Like all normal curves, there was a knee, in case of oil age that was in 1970, before the knee there was rapid growth, after the knee there was still growth but at a much slower level. After 2005, the plateau occurs and we are at plateau now.

For economists: Oil age is like the classical graph between quantity (x-axis) and cost (y-axis) of production. At first part, cost-per-unit (CPU) decrease at increasing rate; at second part, cpu decrease at decreasing rate; at third part cpu stabilize, at fourth part, cpu increase. In oil age, first part is from 1930 to 1970, that is, till the knee; second part is between 1970 and 2005; third part is going on now since 2005.

For marketers: First part is the introduction stage; second part is the growth stage; third part is the maturity stage; fourth part is the decline stage. Oil is a product, like all products it naturally follows a Product Life Cycle, it has a start, some stages and an end. The exploratory stage was between 1930 and 1970, during this time individual wells were identified in these regions, production infrastructure was put in place, various exploratory technologies were developed. In the growth stage, between 1970 and 2005, on the demand side various uses of oil has been identified and adopted, a thing very typical of growth stage. Oil usage increase rapidly and at the end of this stage world becomes fully dependent on oil. We are at maturity stage, which started in 2005.

Note that the case of usa in oil age is different from the case of rest of the world. Usa entered the oil age in 1859, so in 1930 when world was entering its exploratory stage, the usa entered its growth stage. Although usa's oil production peaked around 1930, it continues to grow its oil consumption because even in 1950 usa was producing almost as much oil as it was in 1930 and also because usa was able to import oil very easily from canada, saudi arabia etc.

Note that in most of the world, including china and india, even in 1980 it was very easy to go back to an age of no fossil fuel at all. Two third of population was tied in profession of agriculture and thus had enough farm animals for effective transportation. Since usage of oil was still increasing in 1980s and even in 1990s, and people were replacing traditional products for example jute based bags with oil based products such as plastic bags therefore 1970 to 2005 can be safely said to be the growth phase of oil age.

For historians: First part is birth of a leader, consolidation of the home country, exploration of new territories, business processes and technologies; second part is expansion, wars, occupation of foreign countries; third part is stabilization, setting down on what is already gained and avoidance of further expansions; fourth part is death of the last great leader, increased
corruption of ruling class, placement of clowns, jokers, show off people with little substance on throne, placement of last strong leader with average skills but who spend much of his career in making things better, often this leader fails due to a foreign invasion and once he is gone there is civil war, fragmentation and hence the death of empire. All empires ends. Compare this with oil age.

For philosophers: First part is birth of a beautiful, extremely simple and extremely useful idea; second part is figuring out needed associated ideas, domains and range of the idea, start of wide scale implementation of idea; third part is full scale, whole sale adoption of idea, the time when idea shines like a bright star, the time to get lots of benefits from the idea; fourth part is corruption of idea, when idea is over-used, when idea's main theme is over-ridden by short-term benefits, when idea is implemented in domains its not made for, people lose faith on the idea and its abandoned. Compare that with oil age. Think about ideas like democracy, workers' unions, communism, nuclear technology, journalism (includes all media), personal computers, night lights, division of labor etc.

Do not forget the four stages. Make your life easy.

An important finding, exploration / introduction phase of oil age lasted from 1930 to 1970, that is, 40 years; growth age lasted between 1970 and 2005, that is, 25 years. Is that a pattern? Is golden ratio (40/25 = 1.6) in work here? Well, lets compare that with the case of usa, its exploratory age was between 1859 and 1930, 71 years, 71/40 = 1.78, almost the golden ratio. If there is a pattern, then maturity stage last for 25/1.6 = 15 years, from 2005 to 2020, and decline stage last for 15/1.6 = 10 years, from 2020 to 2030. That is aligned with olduvai theory that says that industrial age will last for 100 years, from 1930 to 2030. It seems like the end of industrial stage will coincide with the end of oil age.

Note: By "oil age" i meant the era in which society depend on oil more than any other energy source, and the era during which oil based products (such as plastic bags, plastic furniture, oil based medicines) are in use more than products based on any other energy source.

Growth is exception, not rule.
Kill mark-ups on debts, be free.

Nice post! I especially like your summary of stage four for historians (I have a history degree).

Dear Wisdom From Pakistan,

I really enjoyed your post. I am working on somewhat similar ideas at my job. You can go on and on with this meme. Tourism, media, fashion, transportation, education, sports, Olympics, science, pro chess, auto industry, computers, academia....The four stages are simply everywhere. I guess Tainter and Kondratieff explain the basics and Georgescu-Roegen worked out a lot of the details. It`s a material flow (well, really matter-cycling, energy flowing) process at the root. Material flows take time to build, then they start to slow down as energy inputs are withdrawn or decrease. The human thinking changes as the flow rates change. We`re only barely conscious of the whole process.

So fun! For anyone out there who is a teacher, this is a great way to construct classes. I do this! It really works!

Where do I find the Cliff's Notes for your post ?

Well, the Cliffs Note

Darwinian et al will be pleased to read that post, because it demonstrates once more, how intense the conception of reality interferes the perception. You want to see and see actualy golden ratios in timeframes 1930 to 1970 / 1970 to 2005 as 40 to 25. Please do the math again for 1970 to 2005.
Besides that, a nice post.

Warned on future, nations look at clean energy

Senior officials from 21 economies making up 80 percent of global Gross Domestic Product were holding talks Monday and Tuesday in Washington in a US initiative billed as the highest-level meeting yet on shifting to green energy.

While few expect announcements Tuesday to be ground-breaking, they would mark a rare point of common ground amid a stalemate in global negotiations on drafting a new climate treaty.

The meeting opened to a dire warning from Nobuo Tanaka, executive director of the International Energy Agency (IEA), which advises major economies, who invoked the three-month BP oil spill in the Gulf of Mexico.

"Without major changes to the way we produce and in energy use, we will confront untenable risks to our collective energy security and to the environment in the future," Tanaka told the delegates.

"Indeed, the Deepwater Horizon accident in the Gulf of Mexico is a tragic reminder of this," he said.

And from the GAO

CCS not ready for 'Prime Time' and please turn out the lights

DOE does not systematically assess the maturity of key coal technologies, but GAO found consensus among stakeholders that CCS is less mature than efficiency technologies.

...Commercial deployment of CCS is possible within 10 to 15 years while many efficiency technologies have been used and are available for use now.

I think China is an exceptional nation.
A great nation, blessed by God, with a unique destiny to lead the world.

"China surpasses US as biggest energy user"

We're number ONE! We're number ONE!

Ah China, where are your talk radio blowhards.

Google invests in Iowa wind farm:


By contracting to purchase so much energy for so long, we’re giving the developer of the wind farm financial certainty to build additional clean energy projects. The inability of renewable energy developers to obtain financing has been a significant inhibitor to the expansion of renewable energy. We’ve been excited about this deal because taking 114 megawatts of wind power off the market for so long means producers have the incentive and means to build more renewable energy capacity for other customers.

How to be a Peak Oil Troll

1. Attack the loonies in the movement. Peak oil attracts weird types because of its possible apocalyptic nature and anti-establishment positions - weirdo’s and conspiracy theorists abound. Link to them. Point them out as peak oil mainstream. Watch the mayhem begin - especially when someone tries to defend your examples!

2. Never cite your own facts or figures. Let the other guy do all the work. If he has to go offline for awhile, it appears you’ve won your argument during the time he’s gone and if the thread expires it’s a real bonus. Always move the bar and hide the ball when the other guy tries to counter

3. If you do cite something make it difficult, time consuming, or expensive to look up. This works wonders at wasting the other guys time and possibly money. Most of the time it ends here. Checkmate without proving a thing.

4. Cite outdated examples and give old Hubbert’s body a good kick. Hubbert is dead and gone but no reason you can’t have a little internet necrophilia. Disciples will froth at the mouth do defend his honor. Everyone makes bad predictions, but stress the ones their side makes. Make them go on defense to those decades old observations.

5. Always cite exceptions to the case no matter how irrelevant to the big picture. What about Burkina Faso’s oil production? That’s the ticket.

6, Claim to be an expert in the field. Hey, who is going to prove your not? Get indignant and claim expertise the other person doesn’t have when your argument goes bad. Liberals try too had to be fair and don‘t want to question you credentials even when they don‘t exist. Lying does work Be careful and avoid technical threads - lest you expose yourself to a true expert.

7. Appeal to authority. A fallacy, but its amazing how many people fall for it. Now they are fighting your authority and not you.

8. Argue over meaningless details or difficult to defend nuances. This really sucks in the math nuts. Since their answers are often difficult to understand for the layman you look far more reasonable to the normal person. And how is this person going to judge who’s right.

9. Attack the weakest members of the group. Wolves don’t prey on the strongest of the herd. Don’t attack the geologist, go for the true believer who can’t back up his beliefs coherently. People might be reluctant to jump into the fray - all the better. Really makes the peak oil crowd look bad.

10. Be an obnoxious sarcastic *sshole. Get the other guy to get emotional and forget what are the salient points of the discussion. Real fun and games. This is true trolling.

Troll on!

Anything I miss?

You missed
1. Repeated indulgence in the straw man fallacy--mischaracterizing Peak Oil.
2. Repeated fallacious statements that Peak Oil beliefs amount to a religion.

I mis-characterized nothing. Just because your belief in peak oil goes one way, and someone else's heads somewhere else, in neither case is it a confusion on my part to notice.

Peakers really need to get their definitions sorted out...or less politely....stop making stuff up as they go along. Oil is oil except when it isn't oil. Or its underwater. Or its in a shale instead of a sandstone. There are accepted definitions for such things, making it up as you go along is not a viable alternative.

Peak oil is a fact, one that you accept also.

How does it feel to be so religious?

Peak oil is a fact, one that you accept also.

How does it feel to be so religious?

To which peak oil do you refer? The one everyone agrees must happen because finite resources have 3 preordained points (start, stop, and a maximum rate somewhere in between)? Or the one where people associate those words with everything imaginable under the sun, based primarily on their belief system?

One peak oil has a single sentence definition which covers the topic pretty well, the other peak oil has an entire world of speculation, conjecture and hysteria hidden behind it, and yes, quite a bit of it is faith based.

I subscribe to the first of course, which doesn't appear to be particularly faith based.

There are a few people hanging about for whom the case is "everything or nothing".

Taking the opposite position, "nothing or everything", doesn't do anything but encourage them to dig in further.

The counter to hysteria is calm, not hysteria in the other direction which is what you have been providing.

The counter to hysteria is calm, not hysteria in the other direction which is what you have been providing.

Would you care to reference exactly what "hysteria" I bring to the conversation? Are you implying that my references to Hubberts work, or actual resource depletion science work in the AAPG bulletin are considered hysteria to some? Certainly I don't recall using any material from any particular group which advocates bringing back hydrocarbons from Titan or anything quite that fringe.

I mis-characterized nothing. Just because your belief in peak oil goes one way, and someone else's heads somewhere else, in neither case is it a confusion on my part to notice.

Peakers really need to get their definitions sorted out...or less politely....stop making stuff up as they go along. Oil is oil except when it isn't oil. Or its underwater. Or its in a shale instead of a sandstone. There are accepted definitions for such things, making it up as you go along is not a viable alternative.


Like I said above: narrow it down. Attack the offensive ideas when and where they come up.

If you think Nevada shale oil should be counted on the same basis as WTI Crude, say so. Argue the point when someone else brings it up or start your own thread to do so. If by "shale" you are referring to the Bakken reserves then I don't think anyone has seriously argued that it doesn't count as "oil" where peak is concerned.

If you think that anyone around here has seriously argued that deepwater oil "doesn't count" I'd love to see the link, myself. It sounds like a mischaracterization to me.

There are indeed accepted definitions, and many of the most interesting keyposts over the years have been explaining those definitions to those of us from non-petroleum backgrounds so that we can actually follow what's going on.

Here's some relevant keyposts for shale:
Shale oil:

Bakken deposit:

If you think that anyone around here has seriously argued that deepwater oil "doesn't count" I'd love to see the link, myself. It sounds like a mischaracterization to me.

I don't usually reference much from this site besides an occasional graph perhaps, so I'm not sure what I was required to do with the multiple shale references. As far as who may or may not count deepwater....

"If we hired a detective to somehow penetrate the smokescreen, I think he would come up with numbers like this for what we can call "narrowly defined conventional oil". This is the stuff that has provided most oil to-date. It will also continue to dominate supply until long past peak. It excludes oil from

coal and shale;
heavy oil and tar,
deepwater and polar areas,
synthetic oil and
natural gas liquids."

Campbell, C.J., The Imminent Peak of World Oil Production, 1999

Colin really doesn't like certain types of oil. Of course, he has changed his mind as of late related to what a post peak world looks like because...well...it happened and he could see the results I suppose. The full scale development of these types of resources and how they reversed a Hubbertian decline in natural gas production in the US may have something to do with it as well.

The discussion here is well past that point, the 2005-2015 peak window includes stuff like the tar sands and other non-conventional sources. Of course, those who would deny peak oil keep trying to add stuff like ethanol and synthetic oil that aren't "oil from the ground in some form reasonably close to traditional crude oil". This is the "All Liquids" number in the reports, and even that isn't showing healthy growth (though it is relevant to any discussion of impacts).

I think that if you take as narrow a view as Mr Campbell does in that quote we are definitely past peak, which means about as much in a practical sense now as I expect it will for some time.

The discussion here is well past that point, the 2005-2015 peak window includes stuff like the tar sands and other non-conventional sources.

Maybe the discussion has advanced that far, certainly the newest round of prognosticators (Colin seems to have mostly moved out of the limelight nowadays) include the production rates of such things in their predictions, even as they exclude the sizes from discovery graphs.

Another way of thinking about it is that the newest group of prognosticators are being forced by the reality of the situation to reconfigure their thinking around the obvious. That being, ignore unconventionals (or the obvious aspects of the resource pyramid) at your own peril. While Colin was trying to exclude everything except his favorite oil, there were certainly signs that such a thing was ill advised.

Production and marketing possibilities both for orimulsion from Venezuela's Orinoco oil belt and for oil derived from the processing of the Athabasca tar sands are now, however, emerging quite positively, so that some part of these resources, at least, may now be designated as reserves. The evolving technologies which have made these initial developments possible will, of course, diffuse to enable other occurrences to be exploited; but, for sometime yet, only under the limiting conditions of low extraction costs and favourable locations relative to potential markets. In essence, non-conventional oil reserves (in the economic sense) will be generated by demand, while, in the global oil market, products from such oil will, first, complement the still rising output of conventional oil and, later (possibly in the late 2020s) will come in to supplement a possible declining production potential of conventional oil, as it can no longer sustain the global demand rising growth curve. A modest 3000 billion barrels reserve of non-conventional oil (out of an ultimate resource base more than an order of magnitude bigger) could then sustain a continued increase in world oil use beyond the middle of the 21st century - as shown in Fig.6 - on the basis of an assumption of a 2% per annum growth in demand. Under this scenario the world oil industry in the mid-21st century would be approximately three times its present size.

Odell, P., A Guide to Oil Reserves and Resources, Greenpeace Report on Climate Change and the Arctic, 1999

I think that if you take as narrow a view as Mr Campbell does in that quote we are definitely past peak, which means about as much in a practical sense now as I expect it will for some time.

I don't take a narrow view, I simply quoted what Colin wrote, and his exclusion of...well....most anything except 42degree API oil sitting in a sandstone anticline (a hyperbole of course, but hopefully you understand why). Certainly if you wish to interpret his exclusionary tactics as a "narrow view" you may. I would characterize it as, more, "historically challenged".

10. Be an obnoxious sarcastic *sshole.

*head hanging in shame*....yes....I can be obnoxious. I apologize.

In the meantime, if you ever make it to an AAPG national, after my presentation I'll buy lunch, and you can critique my "trolling". Can't say I've had a questioner yet who sprang to the mike and said, "sir, do you realize that this entire 20 minute slideshow presentation you just gave us is trolling our esteemed personages", but I suppose there is a first time for everything.

An interesting perspective Bruce, but rather elaborate just because actual modern science references irritate you. I wish I could accommodate your need for web centric only information, but geeze....its the web Bruce.


And yet Reserve, in the very bounded and deterministic world of electrical engineering I can always make it come down to a decision of a coin toss. Its just a matter of how far we want to take the argument of analysis. We, as yet, don't know whether light or EM waves are a particle or wave - or particles behaving as waves - but we use it every day. Even you I bet!

True, there is a fair share of those espousing religious-like points of view, and those that have a real doomer bent, but we know who they are and consider the source. Just because you work in the oil business and may be apparently awash in hydrocarbons does not mean the rest of the world enjoys the same. Consider this, does a fish know of water?

There are many geologists and oil/petroleum engineers equal to, or more knowledgeable and experienced than you that are willing to argue your points. Again, it could be a coin toss. I ask you to be respectful of others wisdom and altruistic contribution.

There are practical limits to understanding the very complex world and some of those interpretations may be wholly correct or wholly wrong; but as history and wisdom has proved through the ages the truth usually lies somewhere in the middle.

There are practical limits to understanding the very complex world and some of those interpretations may be wholly correct or wholly wrong; but as history and wisdom has proved through the ages the truth usually lies somewhere in the middle.

Can't disagree with that.


4 years and 47 weeks, you have been taking notes. It's been a rough day and you made me smile.


Good guide Bruce.

And now, just ignore the troll when he's desperately seeking attention. There is no reason to waste time with the slaying of the slain over and over again.

Agreed. Feel free to flag the posts, but don't engage with the troll.

I found this poem very relevant to the present.

Glad Of These Times
Helen Dunmore

Driving along the motorway
swerving the packed lanes
I am glad of these times.

Because I did not die in childbirth
because my children will survive me
I am glad of these times.

I am not hungry, I do not curtsey,
I lock my door with my own key
and I am glad of these times...

great poem
Its actually great at describing the present situation we are in today.

Great poem, but I had to shorten it to an excerpt and a link. Sorry about that, but posting entire poems, songs, and articles could get us in trouble for copyright violation.

...I do not curtsey,
I lock my door with my own key ....

Fine for complacency; but largely
untrue to those who know better.

It's easier if one does not learn some realities.
But then one's life will be of less value in
a struggle between safety and meaning.

Peak Oil opinions are for the experts.
But it's a metaphor for Peak Consumption.
There's a paucity of experts on that who also have clout.

But it's clear to a thoughtful reader of thoughtful sources
that Consumption is rising in a track that will ruin
anything that seriously matters to future generations.

Bubble, Bubble, Oil and Population Bomb ... The Cauldron Doth Not 'Refeudiate' the PO's Aplomb

The Tom Tom (Friedman --NYT) Cauldron argues everything but .... (shush, whisper it quietly: Peak Oil)

Fine. Forget about global warming. That’s between you and your beach house. How about this? Do you believe in population growth? Do you believe in the American dream? Because, according to the U.N., the world’s population is going to grow from roughly 6.7 billion people today to about 9.2 billion by 2050. And in today’s integrated world, more and more of those 9.2 billion will aspire to, and be able to, live like Americans — with American-size cars, homes and Big Macs. In that world, demand for fossil fuels is going to go through the roof — and all the bad things that go with it.

Did anybody happen to notice two or three months back when the U.S. Army announced that by 2015 or as early as 2012, there would be no surplus oil production remaining(globally). Strictly "hand to mouth" at that point.

Since they do use considerable amounts of oil, I would tend to think that they are in a position to know...