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Drumbeat: October 4, 2010
Posted by Gail the Actuary on October 4, 2010 - 9:20am
Honda Kicks off Conversations Inspired by Its Dream The Impossible Campaign See also Facebook - Honda.
Throughout the month of October and into November Honda will focus on driving conversation around some important topics – all based on the key themes of innovation, environmental leadership, safety leadership, and corporate social responsibility.
The week of 10/4-10/8 will be dedicated to the race against time as it pertains to the world’s dependency on oil as a finite energy source. It’s a concept we first approached in the Racing Against Time installment of the DREAM THE IMPOSSIBLE documentary series and something we see as an important topic that deserves serious discussion.
Racing Against Time Week will feature writings from Peak Oil Blues (Oct. 4), ChrisMartenson.com (Oct. 5), The Oil Drum (Oct. 6), Greentech Media (Oct. 7), and Jetson Green (Oct. 8). Each contributor will post thoughts on their respective websites which Honda will then highlight each day to create a larger conversation on the issue. Participating sites are offering their unique insights and perspectives independent of Honda’s viewpoint.
“Racing Against Time:” Running on Empty?
Welcome, Honda Motor visitors.
I’m delighted to participate in this conversation. I’m a clinical psychologist, got my doctoral degree 22 years ago, and I’ve been reading and answering letters from people who have learned about Peak Oil, started feeling crazy, and needed to talk to somebody who “got it.” So they write to me. Feel free to read the letters I’ve received over the past four and a half years.
There is only one reason to consider the terrifying implications of an oil depleted future: It gives you more options. If you could know, with 100% certainty, that you would lose your job in nine months, wouldn’t you want to know? Of course you would. You might say “Let’s reconsider taking on more debt” or “Let’s not move.” You might grab all the overtime you can. Knowing things ahead of time, even bad things, gives you options, and allows you to make better decisions about how you will live your life today.
The current book, however, starts from the proposition that world oil production has been on a plateau for the last six years, is unlikely to ever increase significantly, and that the final decline in global production will begin in the next few years. It is too late for mitigation strategies that start well in advance of the decline. As neither governments nor media are as yet willing to admit there is a major problem from global oil depletion just ahead, the authors hold that it is likely that we are going to have to wait for the decline to set in before any meaningful action is taken.
Five years ago and today, the Hirsch team sees peak oil as a scarcity of liquid fuels problem rather than all energy. Much of the analysis focuses on either saving or replacing liquid fuels in the decade or two ahead. While solar and wind power will have a slowly growing place someday, many years and trillions of dollars will be required to effect a transition from liquid-fueled machines to those using electricity or some other fuel. The writers seem pessimistic that capital required to make such a transition smoothly will be available during the times of trouble ahead.
Ecopetrol CEO: Sees Total Oil Production At 750,000 Bbl/D In 2011
Ecopetrol SA, Colombia's state-owned oil company, plans to increase oil production to up to 750,000 barrels a day in 2011, Chief Executive Javier Gutierrez Pemberthy said Monday.
The company, which produced 580,000 barrels a day in the second quarter, expects to increase production from several of its existing fields, while also nearly doubling production from the assets in Colombia it recently purchased from BP Plc.
Natural Gas Falls to Five-Week Low on Surplus, Lack of Storms
Natural gas futures fell to the lowest level in more than five weeks on speculation weak demand and a lack of storms in Gulf of Mexico production regions will boost a stockpile surplus.
No major storms hit the Gulf in September, statistically the most active month of the Atlantic hurricane season. Gas inventories were 6.3 percent above the five-year average in the week ended Sept. 24, according to the Energy Department, as mild weather reduced demand for gas for cooling and heating.
Reforms driving Nigeria's oil, gas output growth, minister says
"We are transitioning from gas flaring to gas utilization," she said, citing the Agip Okpai combined-cycle power plant as an example. In Nigeria, associated gas often is considered to be a waste product of oil production rather than an economic resource.
Amy Myers Jaffe of the Baker Institute told OGJ that market incentives to price associated gas work best when it comes to encouraging countries like Russia and Nigeria to reduce the volumes of gas vented and flared. Russia and Nigeria are the biggest gas-flaring countries worldwide.
"Both regulatory enforcements and financial incentives are proving insufficient in Nigeria," said the flaring study. "Several gas utilization projects are under way; however, the completed projects have not been as successful in reducing gas flaring volumes as claimed. In Nigeria, less complicated and lower cost technologies, such as LPG and gas-to-power, could be put in place to utilize associated gas locally."
BENTEK: The Rush to Unconventional Oil and Oil Production Monitor
According to BENTEK, the most explosive growth is coming from unconventional oil shale plays such as the Bakken Shale in North Dakota. In the past year alone, the Bakken oil production has rocketed up 79%, moving North Dakota into position as the nation’s fourth largest oil producing state. Rocky Mountain oil production is expected to double in the next ten years.
“These are extremely important developments for U.S. crude oil production,” noted E. Russell (Rusty) Braziel, BENTEK Energy Managing Director. “The growth trend in unconventional oil looks strikingly similar to what we saw in the early stages of natural gas shale production. And the development is being driven by attractive oil prices, which remain high relative to natural gas. This has provided the economic incentive for many players in the upstream industry to turn to more oil-dominated exploration opportunities to realize higher returns for their drilling investment dollars.”
BP PLC launched a €2 billion ($2.76 billion) bond Monday, marking the first time it has tapped European investors since the Gulf of Mexico oil spill.
The bond came hard on the heels of a $3.5 billion issue last week in the U.S., which the company described as a return to business as usual after a crisis that at one point appeared to imperil its future.
Audit Calls for Improved Nuclear-Plant Security
The Nuclear Regulatory Commission should be given better access to criminal databases and foreign-travel histories to try to keep terrorists from getting jobs inside U.S. nuclear-power plants, federal auditors said in a report Monday.
The commission's inspector general, at the behest of Sen. Charles Schumer, began the review after a suspected al Qaeda member, Sharif Mobley, was found to have worked in a New Jersey nuclear-power plant for six years.
Russia Oil Output May Go Higher After New Record In Sept
Russian oil firms have surprised many this year by increasing output, which topped 10.16 million barrels a day in September, boosted by increased volumes from new projects in East Siberia.
The consultancy says overall production may rise modestly in Russia through to at least 2017--so long as the general economic environment remains stable--and could reach 11 million barrels a day. The Paris-based International Energy Agency expects production growth continuing at least through 2011.
Paper: Cape Wind energy prices high, not competitive with other green projects
The newspaper noted TransCanada, which owns 44 wind turbines in Maine, could sell its wind electricity for 41 percent less than Cape Wind’s 18.7 cents per kilowatt hour seen for the project’s first year in 2013.
Cheap Nuclear Reactors Are Russia's Ace
Russia, one of the world's biggest oil and gas exporters, aims to become a global leader in nuclear power, too. State-owned nuclear group Rosatom now has 15 reactors under construction worldwide, more than any other international supplier (table, bottom of story). Five of the 15 are outside Russia, and more are coming soon.
Oil Rises to Eight-Week High on Signs of U.S. Economic Growth
Crude rose to an eight-week high as U.S. capital goods orders climbed and contracts to purchase previously owned homes gained, signaling the economic rebound of the world’s biggest oil-consuming country is accelerating.
Oil advanced as much as 1 percent after the Commerce Department reported today that orders for non-military capital goods excluding planes expanded 5.1 percent, the biggest gain since March. The National Association of Realtors’ index of pending home resales grew for a second month in August.
Iraq Increases Estimate for Petroleum Reserves, Overtakes Iran in Rankings
Iraq increased the estimate of its petroleum reserves to 143.1 billion barrels, Oil Minister Hussain Al-Shahristani said today in Baghdad, overtaking Iran to become the world’s fourth-largest holder of crude.
The 24 percent rise in estimated reserves boosts Iraq past Iran, which has 137.6 billion barrels, while leaving it behind Saudi Arabia, Canada and Venezuela. Iraq last estimated its oil reserves at 115 billion barrels, in 2001.
Chesapeake sets deal on Barnett gas output
Natural gas producer Chesapeake Energy Corp (CHK.N) said it sold the future production from its wells in the Barnett Shale field of North Texas for $1.15 billion to an affiliate of Barclays Plc (BARC.L).
The five-year deal, called a volumetric production payment, includes about 390 billion cubic of proved reserves and about 280 million cubic feet of production per day in 2011.
U.S. benchmark natural gas prices have slumped in recent months and were trading near $3.76 per million British thermal unit on the NYMEX.
Oil off 2-month high, China data limits losses
Oil eased from a two-month high on Monday as investors locked in profits after a recent rally, but markets remained cautious about the pace of global economic recovery and speculation of further monetary policy easing.
Analysts pointed out the strong Chinese economy and early signs of tightening in the winter fuel market would limit further falls in the overall oil complex.
Oil Gain to $85 in ’11 Threatens OPEC on BRIC Demand
Oil may rise to the second-highest annual level on record next year on demand from China, India and Brazil, upsetting OPEC and threatening the nascent recovery in developed countries.
West Texas Intermediate crude, the U.S. benchmark grade, will average $85 in 2011, compared with $77.70 this year, according to the median of 23 analyst forecasts in a Bloomberg News survey, the highest price for any year except for $99.75 in 2008. Goldman Sachs Group Inc., which correctly predicted a year ago that oil would reach $85 a barrel by the end of 2009, said oil’s mean price will be $100 next year.
Crude Oil to Hit Resistance Level at $86.70: Technical Analysis
Crude oil may fail to breach the $86.70 a-barrel level this week based on statistical analysis used by traders to gauge prices, the Schork Group Inc. said.
Crude’s resistance at that level corresponds to the upper limit of the confidence interval, a statistical range with a specified probability that a given parameter lies within the boundaries. Oil is most likely to trade this week between $76.76 a barrel and $86.70, according to the Schork Group.
Oil Gain to $85 in ’11 Threatens OPEC on BRIC Demand
While China, India and Brazil need fuel to feed their growing economies, members of the Organization of Petroleum Exporting Countries say higher prices aren’t in the group’s interest and threaten the recovery. The International Monetary Fund’s No. 2 official, John Lipsky, said last week that the global economy’s “sluggishness will persist into 2011.”
“High oil prices have acted as the equivalent of a tax on consumers,” said Peter Beutel, president Cameron Hanover Inc., a trading-advisory company in New Canaan, Connecticut, who has followed the oil market for 30 years. “These artificially high prices lead to a lack of unity and cooperation among OPEC members.”
Climate Talks in Tianjin Put Spotlight on China
The first round of international climate talks hosted by China highlights the biggest energy consumer's struggle to expand its role in global-warming policy while shining a spotlight on the country's ambitions and shortcomings in clean energy.
Few analysts or participants expect groundbreaking developments from this week's talks, set to begin Monday in the northeastern Chinese port city of Tianjin.
As Maliki Clings to Power, Iraq’s Fissures Deepen
When Nuri Kamal al-Maliki began his bid for re-election as prime minister — exactly a year ago on Saturday — he pledged to unite a population splintered and suspicious after years of war. He has not, and while he is hardly alone in blame, the consequences could haunt Iraq for years to come.
The purging of ballot lists before the election, the contentious and inconclusive challenges to the results, and the protracted delay in forming a new government since then have all deepened the ethnic, sectarian and societal cracks in a newly democratic state as fragile as an ancient Babylonian vase.
Kurdish support for Al Maliki tied to future of oil-rich Kirkuk
Kurdish lawmakers began on Saturday to plot their course as Iraq's kingmakers with enough seats to secure a second term for Prime Minister Nouri Al Maliki and press key demands, including a greater say over the oil riches in the country's north.
Kirkuk will tap oil fund to fill gap in federal services
Local leaders plan to use oil proceeds to build a power plant in Kirkuk that will generate electricity exclusively for the province.
Over the summer, a power crisis highlighted the continuing failure of national authorities to continuously supply basic services like electricity. A new plant would help Kirkuk fill the gap between national supply and local demand, one of the many concerns of citizens in the still violent northern oil hub.
Republican urges Obama to crack down on Cuban drilling plan
A Florida Republican congressman on Friday urged President Obama to take action against a proposed Cuban offshore oil drilling operation.
Rep. Vern Buchanan wrote the president, saying that he should stand in the way of the drilling plan.
Media reports this week said that Cuba is considering deep water oil drilling 50 miles from the Florida coastline as soon as next year. Buchanan said the plan could endanger the Gulf coast because a BP-like spill could occur.
Chevron to start UK deepwater drilling
An analyst commented to me this week:
Will the oil industry change in the wake of the BP oil spill? I doubt it. There may be some changes on the fringes but most people expect to see business continue as normal.
Today we have the first signs of a return to “business as normal” with the news that the UK energy department has agreed to let Chevron begin deepwater drilling off the Shetland coast. This is the first new project to be agreed since the BP spill.
BP signals dividend payment next year
Bob Dudley, the new chief executive of BP, has sent the clearest signal yet that the UK oil group is on course to restore its dividend payments next year after suspending them in the wake of the Gulf of Mexico spill.
Mr Dudley told the Financial Times that a final decision would not be taken by the board until next year, but said the prospects for a resumption to pay-outs were “encouraging”.
Higher U.S. ethanol blends may face road blocks
U.S. biofuel makers and corn growers are hoping the government will soon approve a higher level of ethanol in gasoline but a number of obstacles, including slow adoption at the pump, could hamper demand for the new fuel blend.
The Environmental Protection Agency is slated to decide by mid-October whether gasoline stations can sell gasoline with 15 percent ethanol, a fuel known as E15, for cars built in 2007 and after. The current maximum level is 10 percent.
Opponents ask US FERC to reject Weaver's Cove's LNG import terminal
A coalition of coastal communities in Massachusetts and Rhode Island has asked US energy regulators to reject on safety and environmental grounds a proposal by Weaver's Cove Energy to build an LNG import terminal in Mount Hope Bay.
In the latest Wall Street Journal/NBC News poll, more than half of those surveyed, 53%, said free-trade agreements have hurt the U.S. That is up from 46% three years ago and 32% in 1999.
The rising hostility seems a delayed reaction to a slow economic recovery and high unemployment. To many, China has replaced Wall Street as the villain du jour.
The Four Best Peak Oil Investments
I'm also looking for companies that typically reduce the use of the personal car, rather than simply making the car more efficient to drive. More efficient vehicles do reduce fuel use per mile, but because of their lower operating costs may encourage driving, and fail to reduce overall fuel use as much as the efficiency number might lead us to believe. I also see problems with most alternative fuels, mainly because there are limits to supply, which should lead to the prices of any widely adopted alternative fuel to track the price of oil.
The stocks I do like are Alternative Transportation stocks such as rail and bus companies, bicycle and e-bike companies, and Smart Transportation companies that combine information technology and pricing schemes to reduce waste in the transportation system by making the markets for travel services more efficient.
US Natural Gas Corp Readies for Additional Oil Production in Kentucky and West Virginia
US Natural Gas Corp (OTC Bulletin Board: UNGS), an energy exploration company with operations in the Appalachian Basin, is pleased to announce that through its two subsidiaries, the Company is preparing to increase its oil production three fold over the next two quarters.
US Natural Gas Corp WV will initiate re-entry and completion procedures on four oil wells acquired in the Wilon Resources, Inc. transaction. The Company intends to have new electrical logs completed on each of the wells to determine if any are candidates for treatment to enhance production.
Gas drilling technique sparks fears in Michigan
Michigan could be on the verge of a new and, possibly, risky era in underground exploration as companies jockey to cash in on the state's natural gas resources.
At the end of this month, oil and gas rights for 452,000 acres of state land across the northwestern Lower Peninsula will be auctioned off. A similar auction held in May generated $178.4 million for Michigan's Natural Resources Trust Fund, which state law designates as the recipient of all proceeds.
Round 5: Investigative Panel Meets Again on Gulf Spill
The next round of hearings on the cause of April's deadly rig explosion in the Gulf of Mexico and the subsequent oil spill are scheduled to begin Monday near New Orleans.
Study: US Food Waste Is a Huge Energy Drain
Each year, American food waste represents the energy equivalent of 350 million barrels of oil, according to new research from the University of Texas.
Houston Ship Channel Closed to Traffic by Downed Line
A tanker carrying crude for Exxon Mobil Corp.’s Baytown, Texas, facility was allowed through, said Neely Nelson, a company spokeswoman. Nelson said there’s no impact to production at the Baytown refinery from the ship channel incident at this point. Brahm said the tanker delivering to Exxon was going to the edge of the safety zone, which is why that shipment was allowed.
1980s: The U.S. energy crisis spurs massive geothermal development, with 26 Geysers power plants producing 2,000 megawatts of electricity, enough to supply about 2 million households.
1990s: Overproduction depletes The Geysers' steam supply, causing operators to close wells and shut down some power plants. Production falls to about 1,000 megawatts.
Are they appropriate agricultural investments or ‘land grabs’? Depends on who you ask
That is the question hanging over the recent phenomenon of countries from the Middle East and Western corporations acquiring huge chunks of rich farmlands in Africa to grow food for export.
In Kenya, the Tana River Delta and the Coast in general have been the main target, raising questions where the local communities will get alternative land for agricultural activities to become self-sufficient in food.
Commentary: Burning the planet to cook our food
One reason is the rising cost of alternatives such as kerosene, gas and electricity. I used to see the cotton wicks for kerosene stoves on sale in every small shop in India and Pakistan. In recent years, the majority of the world's population shifted to urban areas forcing many to switch from open fires to kerosene, gas and electricity.
But then came the shocks of the fuel hikes. In the early 1990s Iraqi oil supplies were shut down and Kuwait’s oil fields burned; then growing Chinese and other demand for fuel exploded.
As a result, in thousands of villages and as well as urban shantytowns, people could no longer afford bottled gas, kerosene , coal or electricity. They shifted back to charcoal, wood and crop wastes.
Sierra Leone bursts with diamonds, oil, iron ore and unease
In August exploration company African Minerals received a license expanding its operations at Tonkolili in the north of the country, where it says it has discovered a 10.5 billion tonnes iron ore deposit -- billed as the largest reported magnetite iron-ore deposit in the world.
London Minerals is exploiting iron-ore at the Marampa mine, Koidu Holdings is exploiting kimberlite diamond mines in Kono, oil-deposits have been found off the coast and the country also boasts gold, bauxite and titanium ore.
Indiana moves to fuel 200 vehicles with propane
About 200,000 vehicles in the U.S. run on propane, which costs about $1.80 a gallon.
Land of poor white trash approaching
Infrastructure is the enabling investment of the future. Get this wrong and Australia's future is constrained. Energy, transport, telecommunications and water are the key to our future in the context of the global issues of peak oil, global warming and water.
Eyes of the world are watching Alberta
Asked if the campaign to paint the oilsands as "dirty oil" is as big as the anti-seal hunt campaign of a few years ago, Baines said: "I'd suggest it's already bigger. More people here have switched onto climate change; it's the biggest ethical issue of our time."
Mortgage Mischief to Add to Housing Illusion
It's no wonder that GMAC and JP Morgan wanted to purge its foreclosure inventory, considering there are approximately 7 million homes in delinquency nationwide, according to Lender Processing Services. The most shocking aspect of the foreclosure pipeline is that on average, homeowners are spending 478 days in delinquency and that number keeps rising (it was 319 days in January 2009). That's right, homeowners are spending well over a year in their homes without having to pay for it; if that's not a bailout I don't know what is.
Coal Ash Cloud Looms Large Over China
The report estimates the country produced 375 million tonnes of coal ash in 2009—more than twice that year’s total urban-waste production. In terms of volume, that’s 424 million cubic metres a year, enough to fill a standard swimming pool every two and a half minutes. If this waste is not dealt with appropriately, it will become a grave threat to the environment and to public health.
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Just posted:
Russia’s oil peak and the German reunification
http://www.crudeoilpeak.com/?p=1912
http://www.eia.doe.gov/emeu/cabs/Russia/Oil.html
Link up top: Iraq Increases Estimate for Petroleum Reserves, Overtakes Iran in Rankings
There are several stories on the wire this morning on this Iraqi reserves increase. And as I expected, this increase brings the subject of OPEC exaggerated claims to the forefront.
FACTBOX-Oil reserves: declining - but how fast?
You think?
Petroleum Intelligence Weekly: Oil Reserves Accounting: The Case Of Kuwait
Table 1: Kuwait Oil Reserves As Of Mar. 31, 2001 (million bbl) Initial Oil Original Cumulative Remaining Reserves Area In Place Reserves Production Proven Nonproven Total South 88,480 46,435 26,209 14,912 5,314 20,226 North 41,038 21,610 4,532 4,336 12,742 17,078 West 29,888 9,613 1,104 4,281 4,228 8,509 Divided 9,503 3,547 1,244 677 1,626 2,303 Zone Total 168,909 81,204 33,088 24,205 23,911 48,116 Source: KOC, report of Reserves Categorization Project, Dec. 2001.Though PIA reported this in 2006, the data was actually compiled in March of 2001, nine and one half years ago. However Kuwait has not produced an average of 2.7 million barrels per day since then, they have only averaged 2.3 million barrels per day over the nine and one half years since that report. In that nine and one half years Kuwait has produced about 8 billion barrels of oil. That would put their cumulative production at about 41 billion barrels and their remaining reserves, both proven and non-proven at about 40 billion barrels. Obviously most of the production would have come from their proven reserves.
Edit: My figures for Kuwaiti production average is crude only, taken from OPEC's "Oil Market Report".
Ron P.
Didn't we have almost a year ago:
12/11/2009
“Key oil figures were distorted by US pressure, says whistleblower”
http://www.crudeoilpeak.com/?p=564
How fast the time is passing and the problem with OPEC's paper barrels is still not understood
11/6/2010
BP Statistical Review June 2010: Oil reserves and production don't match
http://www.crudeoilpeak.com/?p=1591
31/7/2010
Saudi Aramco's crude oil exports peaked in 2005
http://www.crudeoilpeak.com/?p=1738
Will the penny drop when oil goes up to $130, the price Iran needs to balance the budget?
3/7/2010
IEA: Iran's crude oil production to decline by 700 Kb/d by 2015
http://www.crudeoilpeak.com/?p=1669
There's something wrong with that calculation. 2.7 million barrels a day works out to just under 1 billion barrels a year. Therefore Kuwaiti reserves would last 24-48 years at that production rate, depending on whethere the non-proven reserves are real or not.
I think they meant to say that Kuwait has only nine years left, from March 2001, before they peak, before production starts to decline. Also, that 2.7 mb/d figures is for all liquids. I have no idea if the reserve figures are all liquids or crude only. I just always assumed they were crude only.
Ron P.
And still some people just don't get it!
NASDAQ: The Energy Report for Monday, October 4, 2010
Yes, Iraqi reserves will just keep on increasing and increasing... forever. What a terrible setback for us peak oil theorists. :-(
Ron P.
From the top article:
And from your quote, Ron:
[emphasis mine]
Do you suppose that this confusing of millions and billions was just a faux pas? The author's use of the word "mere" suggests that this was intentional. Liar, Liar, Pants on fire!
The masses, hungry for reassurance, will scarf this up like pig slop. I guess nine years of war/occupation is paying off in
spadesbarrels.My guess is that the authors of the second article picked up "115 million barrels" somewhere as a misprint and actually believed it. A mere 115 million barrels to a whopping 143.1 billion barrels. It is possible that some peak oil critics are really dumb enough to believe that Iraq increased their reserves by over a thousand fold.
On another subject, it looks like Iraq's figure of 143.1 billion barrels was deliberately designed to put them just above Iran's reserve figure of 138.4 billion barrels. Look for Iran to upgrade their reserve figures in order to get back in second place.
Ron P.
Can have all the paper barrels in the world, its how much you can ship each day that counts.
During the late 80's I was reading the Oil and Gas Journal in our local library and recall being fooled by the OPEC statistics. L. F. Buz Ivanhoe was one of the first if not the first to expose the charlatans and incompetents from OPEC, BP, Oil and Gas J. and The Economist.
http://hubbert.mines.edu/news/Ivanhoe_96-1.pdf
The Oil and Gas Journal is still at it.
World Proven reserves: Millions of barrels
BP Statistical Review Oil & Gas Journal World Oil World Total 1,238.892 1,342.207 1,184.208Most of the difference is Canada. BP gives Canada 27.7 billion barrels, World Oil gives them 25.1 and Oil & Gas Journal gives them 178 billion barrels. Of course they are counting the tar sands and the others are not. O&GJ gives Venezuela 99.3 bb, BP gives them 87 and world oil 81.
In most, but not all of the other cases they are pretty close. For instance both BP and O&GJ give the United Emirates 97.8 bb but World Oil only gives them 68.1.
World Proved Reserves of Oil and Natural Gas
Ron P.
Does that statement make any sense? Isn't that kind of information estimated early on once fields are discovered, then as oil is extracted those numbers go down? In the Middle East, maybe there really is a gooey nugant down deep of theoretical abiotic microbes that are constantly producing more oil, providing ever increasing oil reserve numbers to be announced annually. I'm dreaming of a white Christmas...
Suppose Kuwait has 42 Gb and produces 1Gb/yr.
Maybe they can maintain production(why not?) for 28 years (2/3 of reserves)
and then straight line decline at 4% per year(28 more years).
Nobody will be sure they are in decline for 28 years.
Even if they only have 24 Gb, nobody will be sure for 16 years.
You can hardly blame them for limiting production to conserve their stocks.
Meanwhile Mexico and Norway are declining now.
The Arabs + Iran represent 55% of the major world export market in oil, FSU 22%, Africa 10% and Venezuela 6%.
If demand is modest the world export market should be steady for a decade or so.
The problem now is the depletion of old fields(US,UK, Nor, Mexico, and Indonesia)putting demand pressure on international prices as much as Chindia. In the future
the EU and North America will have to develop its own oil or learn to live with much less.
Majorian, if the figures PIA reports are correct then Kuwait would have from 40 to 42 billion [proven + non-proven] barrels left of their original recoverable 81 billion barrels. About half. 28 years at 1 billion barrels per year would leave them with 9 to 11 billion barrels left but only if all their non-proven barrels prove to be recoverable. That would mean that, at they point, they would have between 12 and 13 percent of their original recoverable oil left.
That would mean they would have produced about 88 percent of their [proven + non-proven] recoverable oil before they start to decline! Impossible!
Not quite. If they have only 24 Gb left everyone will know it almost immediately. Surely you understand Majorian, that production begins to decline after about half the oil has been removed from the reservoir. EOR techniques may or may not push this to 60 to 65 percent of depletion but not further than that before decline sets in.
Incidentally Kuwaiti production peaked in 1972 at 3.28 million barrels per day or about 1.2 billion barrels per year. OPEC Production dropped steeply during the during the OPEC boycott and again during the problems with Iran-Iraq war in the early 80s. Production recovered to 1.585 mb/d in 1987. Then they began to decline, probably because of OPEC quotas. Then in 1991 the Iraq invasion caused production to drop to almost nothing.
But after that war, with the help of the US and several US oil service companies they were producing flat out in 2005 and 2008 when they produced 2.53 and 2.58 mb/d respectively. (C+C)
I am of the opinion that Kuwait will never produce 2.5 mb/d ever again. They are post peak and are in decline. The decline will accelerate in a couple of years.
Edit: If EOR is able to delay the decline of major oil producing nations to 60 to 65 percent of depletion then the decline rate will be a whole lot faster than most people suspect. But if the decline rate can be delayed even further as Majorian suggests, then when the peak finally does arrive production will fall off a cliff.
Ron P.
If Kuwait has already burned through 88 percent of their reserves, how can they possibly be still producing 1 million bpd, let alone 2.2 million?
You're going to have to entertain the possibility that Kuwait's stated oil reserves have been conservative, rather than exaggerated.
Edit: Sorry I mis-read the exchange. Nonetheless, if Kuwait has already burned through about half their reserves it would beg the question as to how they can still be producing at about 2/3 of their peak rate. The possibility that their reserves have been conservatively stated rather than exaggerated has to be considered.
Are you kidding? If Kuwait still has half their reserves left then they should be at peak not 1/3 down the backside of peak oil. That, Abundance, is when countries peak, when they have produced half their producible reserves.
I see you have been a member of this list for 34 weeks. If you had been following the peak oil story for several years like the most of us, then you would have realized that the peak production usually comes at peak reserves... or with enhanced oil recovery, somewhat past peak reserves.
In fact they could delay the peak until they are well past 50 percent of their reserves. They could do this by drilling hundreds of horizontal wells to suck the oil right off the top of the reservoir. In fact that is what most nations are doing right now. That is why I expect a shark fin peak. That is because when the oil finally hits those top of the reservoir horizontal wells, the drop off is extremely fast from that point on.
So it must be considered that even 24 to 48 billion barrels in 2001, or 8 billion barrels less today, is probably overly optimistic if they have kept production up with horizontal wells.
Ron P.
Abundance,
The other possibility you might concede is that as time has gone on, they have been able to put more straws down and with improved technologies are also sucking harder at the milkshake. In fact (not knowing the well-counts for Kazach.), that would seem to be almost inevitable.
It's ok, though. Kashagan will save the day, eventually.
OK all, I await the crashing of Kuwaiti production in the next few years or so. This will be interesting.
BTW, I have been following the "peak oil" issue for as many years as many of you have. Among other things, it has taught me there is rarely such a thing as fixed reserves. Just because Kuwait said in 1990 (or whenever) that they had X barrels of P1 + P2 reserves does not mean that is the only oil they ever had. If you say, "Oil production typically peaks when they've burned through half their reserves," the question then becomes, "How do you know when they've burned through half their reserves?" What if they determined they had only 30 billion barrels of reserves in 1970, but by 2000 that had risen to, say, 80 billion barrels? If they started production in, say, 1950, and were producing an average of 1 billion barrels/year, according to the 1970 figure they "should" have already peaked, or at least be very close to peak, in 1970. Yet, 30 years later, they had burned 50 billion barrels but still have 30 billion to go, even though their 1970 figure told them they should have sucked the cup dry years ago. So once again, they "should" be past or at least near peak . . . same as they were 30 years ago. Putting a fixed - or even approximate - date on some nation's peak based on how much reserves they said they had in Year X is a fool's game, because reserves are a moving target.
Really Abundance! You will know when they've burned through half their reserves when production starts to drop of course. Well, that was the case up until about 20 years ago. Now with the advent of horizontal MRC wells they may be able to delay the peak until 60 to 65 percent of the recoverable oil is gone.
If they pump water into the parameter of the reservoir at the bottom, and take the oil right from the very top, then they can delay peak production until the reservoir is well past peak reserves.
But at any rate they will not know they have peaked until they peak. Then they are usually quite shocked that they have peaked and shocked even more at the rate of decline.
Ron P.
Peak oil is about the size of the 'tap' not the size of the 'barrel' - the amount of money invested in that tap is determined by producer's opinion of what the price of crude will be in the future, they can't just charge what they want for the crude because oil is fungible - the time of peaking is caused by the price expected in the future ... production must be both profitable for the producers and at the same time, affordable for the consumers. There are way too many variables to be precise about any of this.
All we can say is 'world crude oil production will reach a final peak at some stage'... if you look at the statistics, modern production for individual wells peaks typically well above the half depleted mark ... we will only know when it was by looking in the rearview mirror.
Using technology to boost production now results in a much steeper post peak decline (and hence bigger problems coping with the rapid change) than we would otherwise have had.
I don't believe we will see a Hubbert style curve for Kuwaiti oil production(there are several fields). I think we will see an extended plateau followed by a 4% decline(25 years).
Likewise Texas dropped 70% in 35 years in a fairly straight line or 2% per year.
I would that is about normal for a terminal decline in onshore fields.
I assume that the Kuwaitis will pump to maintain current production of their sole resource for political reasons.
It's just a trapazoid; 1/2 * ((x+25) + x) x 1 Gb =24 Gb
x=11.5 years of steady production which I bumped up few more years ~16 years. If terminal decline starts now reserves turn out to be a ridiculous 12.5 Gb.
I would also point out that the actual data in both cases is more linear than concave so using fancier decline curves would not reflect reality of decline any better.
I think you are correct except I expect the plateau to last about 45 years. In fact that is how long it has lasted if you take away the blockade and the two wars that interrupted their production. Though it would have had a slight down-slope, dropping about 1 mb/d since 1972. The 45 year plateau will end in just about two years then I think we will see that 4% decline you predicted beginning late 2012 or early 2013.
Yes Majorian I think you hit the nail on the head except for the length of the plateau.
Ron P.
P.S. Just kidding, I know you meant 25 years from now. But that is just a little ridiculous don't you think. Kuwait, like Saudi, is considering the possibility of CO2 injection in order to keep their production up. They would not be doing that unless they were very nervous about declining production.
If you Google (Kuwait CO2 injection) you will get lots of hits but this is a good one. (Huge PDF)
CO2 Capture and Injection for Kuwaiti Reservoirs
At the above link check out the chart on page 3. They say the world excluding the Middle East has already peaked and the chart shows the Middle East peaking, or plateauing, in 2013 and falling off that plateau in 2019. And this is a Kuwaiti produced document.
They have the world non-conventional liquids supply peaking in 2013.
Ron P.
Looking at EIA monthly C+C figures downloaded a few months ago Kuwait is shown as producing 2350 kb/d Jan '09 through April '10 - another instance of EIA flunkies entering in any old figure without hesitation. These laughably unrealistic numbers have been subsequently revised upwards to merely unrealistic ones, where they only maintain the exact same levels (calculated out to the 100th decimal point) for three months at a time.
Don't forget Project Kuwait, which will celebrate its 20th anniversary next year.
You're so amusing, Darwinian!
Not exactly falling off, more drifting down after 2019.
This 2007 report say 50 Gb for Kuwait.
The 2020 strategy is constant production of 2.7 mbpd until 2015.
No peak so far.
EOR has helped Oman stabilize production.
You are funny. You start your chart eight years after the peak and you have the audacity to say "No peak so far." Try starting your chart in 1970 instead of 1980 and you will clearly see the peak of 3,283 average barrels per day in 1972.
The OPEC oil embargo was in 1973, then came the Iran-Iraq war and the subsequent "Tanker Wars" in the Persian Gulf. These are what caused the first and second drop in Kuwaiti production. The first Gulf war simply kept them from recovering. But by 2005 theu 2008 they had fully recovered and were then producing flat out. But their production had not recovered to their previous 1972 peak. And they never will! In fact they will never again reach 2.5 million barrels per day average per year. Their peak month, in the last ten years, was July of 2008 when they produced 2.607 million barrels per day, (crude only). They will never reach that monthly average again either.
If there had been no embargo and wars then there would likely have been a gradual downtrend from 1972 until today and the 1972 would have been obvious. They would have produced a lot more oil during those embargo and war years and their production would have likely been well under 2 million barrels per day by now.
Ron P.
Calculated using the natural log function, the Texas decline has been about 3.5%/year.
Using the natural log function gives you a different result from using per cent decline as a constant decline rate is an approximating good over a few years;
1-kt is not equal to (1-k)^t or exp(-kt)
TO: John Michael Greer,
1) I have a few questions on (modelling) your paper on catabolic collapse (cocerning last Thursday's TOD post). What is best way to contact you?
2) How does one set up a blogspot? I've asked around, but I suspect people are playing headgames with me.
Thanks,
Ignorant
1 - contact that can be forwarded is at http://aoda.org/contacts.html (I won't post the email address I have)
2 https://www.blogger.com/start
Thanks.
Quite welcome. Hopefully you'll find "blogging" worthwhile. (And perhaps you can other common ground with Brother Greer)
Re: Commentary: Burning the planet to cook our food
Still another reason why we should be switching from open fires and ordinary cast iron stoves, to rocket cook stoves and rocket heating stoves as quickly as possible. Fuel savings are typically in the range of 50% from the rocket cook stoves, and maybe 20 to 30% from switching to rocket heating stoves. And rocket stoves of both types emit far less smoke and other air pollution.
Link to these stoves ?
Mike, just google "rocket stove"...lots of links out there.
http://en.wikipedia.org/wiki/Rocket_stove
http://www.rocketstove.org
Several organizations are distributing solar ovens/stoves in developing countries:
http://solarcooking.org/Solar-Ovens-for-Developing-Countries.htm
http://www.solarcookersforafrica.com/
While "rocket stoves" can be useful and are much more efficient than open fires, they still require fuel.
And rather than 'rocket stoves' one could look into sheffier dishes and just use sunlight.
(see my bio for a link if you care)
The big problem I have with the solar approaches is that they are dependent on the Sun which is a variable resource.
The iron mass if perhaps combined with something like the rocket stove might be the right answer.
Cook using a dependable heated mass and multiple ways to heat it. I actually ended up with the heat and iron bar or something similar solution myself. This decouples the source of heating from the use.
My attitude if you will is a bit different its how can you get convenience that rivals whats available in the western world using simple methods. I think if people can get something that works close to the instant on ease of use common in more developed countries then they will adopt it. Traditional cooking methods in the third world might not be the best but I think people overlook how important it is to the cook to be able to understand and control the cooking process. They know the traditional methods other approaches can have problems. Cooking using a hot iron bar can be mastered how its heated can be decoupled.
Why does that make for a problem?
Intermittency is only a problem if you're still living in the mindset that one solution will be a constant and unending cure. As that all goes, Solar is a pretty reliable source for foragers of energy.. and just like smart kids who get their allowance on Friday, they'll figure out how to work with it when it's there, and hang on with other solutions through the 'weather'.
Given the magnitude of the problem, we will need to use both rocket stoves and Scheffler dishes, and probably many other new developments, using each where it will do the most good.
E-15- all I can say is be careful of about what you ask for.
If you have a pump that is selling e-15 and E-10 side by side you have to ask yourself why would a consumer want E-15. The only reason (the octane boost is already achieved by E-10) is because E-15 is considerably cheaper. But a gallon of ethanol has only 66% of the BTU of a gallon of gasoline so a 15% blend would have to be about 1.7% cheaper than E-10 blend or at $2.50/gallon about 4c/gallon only 2.25c of which is made up by the excise tax credit (if it survives). So either the oil companies lose money or the consumer gets screwed.
But here is the interesting thing - once the consumer realizes that they are paying more for gas because the ethanol blending requirement does that create a back lash against e-10 as well?
How do you make sure that the E-15 is only pumped into post-2007 cars that are designed to handle it?
Just don't buy it. I don't even buy E-10 if I can help it.
Ron P.
We talk about E-15 vs E-10 in our Honda post which goes up Wednesday. I can't see how the EPA could mandate E-15 for selected model years. If it is voluntary, it is hard to see why sellers would sell it or buyers would buy it--except for a very few, who don't understand that it gets lower mileage, and that it may void the car's warranty.
Gail, you need to fix the link up top, it don't work. This one will.
Honda Kicks off Conversations Inspired by Its Dream The Impossible Campaign With Contributions From Five Bloggers on the Global Energy Crisis
Ron P.
Got it fixed. They sent me a PDF--wish folks would send a link instead.
I had always assumed that they would force manufacturers to change the warranty, but never though much about it. It would be much harder to do this retroactively.
If use is voluntary, one would think that price would have to come into play, but that would be a bit tricky in this case as consumers would have to be aware of the price comparison on a BTU basis and the savings would have to be significant. Saving 5% on 15% of your fuel is less than 1% total savings, not enough to justify more frequent fillings, worries about damage to your car and voiding the warranty. Since current production costs don't seem to support any discount at all, this would have to involve additional subsidies.
Malaysia's Petronas profit up 60% in first quarter
Global steel production may plateau in 5 years
Re: Iraq increased the estimate of its petroleum reserves..
Not to worry, within a short period of time other members of the OPEC will up their “proved” reserves and we will be back to ever increasing fictional “reserves!” We have got enough oil to last us for ever—i.e. until we run out.
Cheap Debt for Corporations Fails to Spur Economy
or they are buying gold ....
Super-rich investors buy gold by ton
http://news.yahoo.com/s/nm/us_wealth_summit_gold;_ylt=AtK1JDApNQUAQOdBg4...
In my opinion, this is the problem with top-down stimulus - all of the money piles up at the top of the food-chain and does nothing to make the overall ecology more resilient.
Bottom-up stimulus makes more sense to me. For example, what if stimulus monies were invested in a "partial principal forgiveness" program for ALL individual homeowners (instead of Quantititative Easing")?
1. Home loans of reasonable quality are stabilized; the homeowners can take advantage of refinancing; and household confidence in the future is elevated. The over-leveraged loans, however, remain in trouble. The incentives are right.
2. Banks see good quality loans stabilized and have greater certainty about their future. The bank will eat poor quality loans, however. The incentives are right.
3. Total private leverage in the economy is reduced, providing a solid base for restarting sound investment in the economy. The new public debt will be paid by those who benefit most from the future prosperity (taxation on future income).
Huh? Something About Tax Cuts Or Earnings Or Money Or Something In Recent Economic News | The Onion - America's Finest News Source
Finally; something about the economy that I can understand.
I was reading about Black-Scholes and a common formulation uses the Fokker-Planck equation. I did not realie how much the quants bastardized the physics stuff.
Normally, one considers "concentration" as the quantity of interest and then use "distance" and "time" to define the pathways for the flow of concentration. In Black-Scholes, concentration is represented by "options" (or some other derivative) and the distance is "stock price" (what the option depends on) and time remains time.
I am all for using ideas from physics to represent other behaviors but treating stock price as a dimension that options move around simply blows my mind.
Sorry to get deep, but there is an Onion quality to this math as well.
When you come at this from an academic finance perspective, the source of these techniques as a "bastardization of physics" is overt and clear.
Black Scholes is taught as a approximation or heuristic, not a precise measurement of value. However, prior to its introduction 40 years ago options were priced on pure guesswork. An approximation is better than nothing (reference Net Export Model).
In a typical example of its use, Felix Solomon in the linked article calls it an options calculator and says it "gives you a good ballpark figure"
http://blogs.reuters.com/felix-salmon/
Binomial models can also be used, but are much more complicated and have their own problems.
The point here is that finance is aware that "all models are wrong, but some models are useful".
True a Black Scholes output will not be very accurate, but it is a very quick way of getting closer than guessing.
I agree with much of what you are saying. However, to the degree that you claim finance thinks these are perfect, but they are really just rough tools, you are incorrect. Academic finance knows they are rough tools. Good practitioners do too.
But bad finance people do bad finance, bad engineers do bad engineering and bad scientists do bad science.
Not true on several counts.
When a "bad engineer" does bad engineering, Mother Nature usually lets him/her and everyone else around know about it fairly quickly. There's no fooling Mother. You either play by her rules or you lose.
When a "bad finance person " does bad finance, Mother Nature doesn't hear and doesn't care. It's just a bit more of ape noise that we 'financially clever' primates make amongst ourselves. There may be no fooling of Mother Nature, but you can fool most of the people most of the time when it comes to 'finance'.
Also, it is not the bad finance people who do the bad finance, but rather the financially successful people who do bad finance and get rewarded for it. Think Goldman and what's on his feet. They get doubly rewarded, once for selling the junk and the second time for shorting it.
Sorry step back I'm going to have to stick with:
bad finance people do bad finance,
bad engineers do bad engineering
My comment didn't say anything about outcomes. It seems we agree both can be bad. I don't think you can make the argument that bad engineering (as well as some good science) hasn't had negative impacts on humanity.
And unfortunately, us clever primates may be starting to bother mother nature.
That is hilarious KLR...
When you read through it fast it really doesn't make any LESS sense than the neverending breathless proclamations about the economy one hears on a daily basis.
This went up, that went down, housing starts fell, housing starts surged, auto sales, consumer confidence, price index... blah blah blah...
No wonder no one pays attention to any of it any more.
For example, what if stimulus monies were invested in a "partial principal forgiveness" program for ALL individual homeowners
And the homeowners with no principle to forgive?
What about the 'moral hazard' of benefiting the banks anyway?
The people who rent and the people who bought what they could afford cash outta pocket are punished by your plan. Why?
Under the 'argument by analogy' program:
You have a sick, important patient that you don't want dead. Standing over that patient with a needle which will prob. kill the patient is a doctor who says "if you don't give me what I want, I'll withhold this injection".
Rather than discuss should the patient just die anyway, what really is the patient sick about, or even why do we have this doctor here - the doctor was treated as an authority figure and what the doctor said he wanted was handed over to the doctor.
I have just subscribed to the Kindle version of The Oil Drum. Is there a way to view comments on the Kindle - in addition to the editor's articles that are currently visible? I'm sure this question must have been answered previously, but I cannot find any references to "Kindle comments". Thanks!
I'll ask SuperG. I am sure he is in charge of that.
I have had a Kindle since Christmas 2008. Have tried many different items including some of the free downloads, financial and medical blogs and books for my significant others' book club. When I had TOD earlier this year it did not pick up the discussions. Still I believe that the Kindle app. could be useful, especially for those who must spend time traveling or away from a good connection and wish to keep abreast of the main posts. I would be interested to know how many have subscribed and if there has been significant income.
Unfortunately, there is no way to include the comments in the Kindle version. This is a limitation of the Kindle publishing system; there is nothing we can do about it.
Perhaps it would be possible to create an archived entry, say a day later, which captured the drumbeat discussion as a separate post? Day old discussions are still very illuminating!
Passat BlueMotion enters record books after going 1,527 miles without refueling; that's 74.8 mpg. Source: Autoblog Green
Not that surprising, really. The key is to keep the speed down - this guy was at 45mph.
With my TDI Jetta, I got 55mpg going to Toronto and back. I think I was going 50-55mph on that trip.
I knew a guy who drove from Salt Lake City to Philly and got something like 70mpg - again by keeping the speed down. At one point, he got pulled over by the state police for driving too slowly.
There are a number of Diesel cars on the European market that get that kind of mileage. The only unusual thing is that for some reason this car is equipped with an enormous 20 gallon tank.
Generation Y Giving Cars a Pass
This trend is already evident in Japan, where the car fleet is shrinking, and young people are not buying. They don't define themselves by their car, or how much stuff they have, it is by their iphones, and, sometimes, how little stuff they have.
For young people today, faced with high insurance rates for driving, and low paying jobs, if they have one at all, why bother? And with many more young people still living at home, they'll take Dad's car.
And when these people do want a car, what are the chances they will want an SUV or minivan or any such thing? Those who end up having a multi child family *may* do so, but they are a shrinking group. The age of SUV's and Minivans will die with their current owners, if not before.
First-of-its-kind study finds alarming increase in flow of water into oceans
All I know is I am seeing a lot more reports of flooding worldwide and even in this country of late.
Here abouts, we had a very heavy rainfall year last year, but this year we are over 10 inches below normal. If I had not taken steps to increase my rainwater catchment system, I'd be hurting right now. Lucky for us most of the capacity we have was cheap to get, so that paid for itself in one year compared to what the water out of the tap would have cost.
But the lack of water has incresed the overall use of most everyone else, we get it from rain fed collection sources, so lack of rain, just makes the problems worse.
I wonder what the place will look like in 20 years? Anyone need to buy oceanfront land in midland mississippi?
Charles,
BioWebScape designs for a better fed and housed world.
"All I know is I am seeing a lot more reports of flooding"
Not only that, but flooding at weird times of year--lots of locations around here broke records for flooding for this date--mass flooding that we usually only see around here in the spring.
But then, there IS no "usual" anymore. Global Weirding is well underway.
Nations wary of dependence on China's rare earths
A couple more reasons to hold Wall Street and the financial sector in contempt.
Study finds foreclosure crisis had significant racial dimensions
Payday Lenders: How Wall Street's "Undercover Brothers" Exploit Minorities
The amounts that you can deposit, and get high interest rates, are limited ($10,000 to $25,000), but this is very interesting:
http://www.dallasnews.com/sharedcontent/dws/bus/columnists/sburns/storie...
Scott Burns: Shifting accounts away from the larger banks can mean larger yields
Tired of getting no interest on your bank deposits?
This is reminiscent of Savings & Loans in the 1980s that offered high yield CDs in order to attract deposits. The rest is history (S&Ls went bust to the tune of $100 taxpayer billion. Sound familiar?).
I did notice that the one closest to my zipcode has the following qualifications :-
"To meet these qualifications do each of the following each month†:
•Minimum of 10 signature-based debit card purchases (ATM usage does not count toward the 10 purchases)
•1 Automatic Payment or Direct Deposit transfer
•Receive your monthly account statement electronically "
Someone is paying for the debit card transactions - generally the store owner. The high interest must get paid out of profits on debit card fees.
TANSTAAFL (there ain't no such thing as a free lunch) - accredited to Heinlein.
"Fight over Debit Card Fees a Battle of Titans"
"(AP) Swipe your debit card at the supermarket and you've placed yourself at the heart of a contentious congressional debate.
On one side are banks like JPMorgan Chase and Bank of America and credit card networks like Visa and MasterCard. On the other are retailers, including giants like Wal-Mart and Target.
At issue: The "swipe" fees banks charge merchants for one of today's most commonplace conveniences. At stake: up to $20 billion in potential bank losses and merchant gains.
For consumers, it could mean lower prices at the local store or restaurant, or it could result in higher bank charges, fewer "rewards" for credit card users or even the imposition of an annual debit card fee."
http://www.cbsnews.com/stories/2010/06/08/business/main6560562.shtml
Signature-based debit card purchases result in a high interchange fee being charged to the merchant, of which the card-issuer gets a significant piece. The interchange fee is similar to that charged for a credit card transaction and it depends on the value of the transaction.
A PIN-based debit card purchase results in a small fee being charged to the merchant, something like 15 or 25 cents, and the PIN-based debit fee isn't a percentage of the transaction value.
If you don't need the money for a few years, who needs a bank? It is better to buy high dividend paying blue chips. E.g., JNJ, PG, KFT, MRK, PFE. You also get the benefit of diversification since most of these big multinationals get a lot of their profit from outside the US.
Even better are high dividend paying oil & natural gas royalty trusts: ERF, PBT, PWE, BTE. With ERF & PWE you get the benefit of currency diversification as well since they pay dividends in Canadian $.
It looks like oil & natural gas is now starting to catch up with other commodities.
Please, please, please be very careful with this. A dividend and not directly comparable to an interest payment. Your analysis, is flawed and dangerous.
In debt (or a bank account), you gave a fixed principal (equal to value of the security) and fixed payments.
In equity (with dividends) the dividend policy or amount can be changed, dividends always equal some sort of an allocation between value of the security and the payment, and the equity portion can lose value. Finally, equity is hugely risky compared to debt and savings accounts. You could lose the principal.
Resource trusts for example are expected to have the declining equity value and so can not be compared to a bond or savings account.
While the point you are making is valid as a part of a fairly sophisticated investment decision, it does not provide an alternative to a bank account, which already exists.
Bonds are the correct alternative to savings and have much closer risk return profiles. Keep in mind that the main factor driving up yield is risk. The riskier the investment the greater the yield. If you leave an FDIC insured account for an instrument with similar risk otherwise, you should get compensated in the form of yield. Similarly corporate bonds tend to pay more than gov't because they are riskier.
These are all similar entities and can be compared.
A whole lot of UK investors thought they could use Suyog's strategy and depend on BP dividends. Many got crushed.
I don't know much about Physorg, but after chasing down the truth behind this hyperbolic link you posted yesterday, I wouldn't rely much on their editorializing.
http://www.theoildrum.com/node/7013/728576
The links seem useful though.