Drumbeat: September 3, 2012

Jordanians protest as petrol price rises again

Jordanians have taken to the streets to vent anger at the government's second fuel price increase in three months.

The rise comes as Jordan seeks to fill a gap in its budget that widened after the government raised subsidies for basic goods last year.

Yesterday, taxi drivers blocked a main road in Amman as they abandoned their cars and marched to the ministry of transport in opposition to the hike.

It followed a protest on Saturday by hundreds of activists, some clutching placards in protest, demonstrating near the interior ministry.

Jordan's King Abdullah blocks fuel price hike

Jordan's King Abdullah has ordered the government to freeze a hike in the price of the low-grade fuel used by the poor in the aid-dependent kingdom, which is struggling to absorb refugees from neighbouring Syria.

The price hike, which sparked several scattered street protests by the government's tribal and Islamist opponents, was the second this year under IMF-guided measures to cut subsidies and ease budget strains.

Oil Declines From One-Week High as Chinese

Oil dropped in New York from the highest closing price in more than a week as manufacturing unexpectedly contracted in China and crude production resumed in the Gulf of Mexico after Hurricane Isaac.

Futures fell as much as 0.5 percent. China’s Purchasing Managers Index shrank for the first time in nine months in August, a government survey showed Sept. 1, stoking speculation the central bank may boost measures to stimulate growth. About 72 percent of crude output in the Gulf was shut, from 95 percent last week, according to the U.S. Bureau of Safety and Environmental Enforcement.

Record Labor Day gas prices won't last

NEW YORK (CNNMoney) -- Gas prices are higher than they've been going into any other Labor Day weekend on record, but experts predict some relief at the pump is coming fairly soon.

Asia Fuel Oil-Sept/Oct climbs to over two-month high

SINGAPORE (Reuters) - Asia's fuel oil market strengthened on Monday, with the prompt inter-month spread inching up to its highest in more than two months, as sentiment continued to be supported by low inventory levels.

NASA Helps Hatch Robots for Drilling Oil Without Humans

NASA’s Mars rover has something to teach the oil industry.

Traversing the Red Planet while beaming data through space has a lot in common with exploring the deepest recesses of earth in search of crude oil and natural gas. Robotic Drilling Systems AS, a Norwegian company developing a drilling rig that can think for itself, signed an information-sharing agreement with NASA to discover what it might learn from the rover Curiosity.

Libya’s NOC Says 2012 Oil, Gas Revenues to Total $54.9 Billion

Libya’s National Oil Corp. expects to generate $54.9 billion in revenue from oil and natural gas this year, according to a release posted on its website.

European, Asian firms bid to expand Saudi refinery

(Reuters) - European and Korean companies have bid for a project to double the capacity of an oil lubricants refinery in Yanbu controlled by state oil giant Saudi Aramco, industry sources said on Monday.

Aramco still in damage-control from cyber-attack

State oil producer Saudi Aramco is still repairing damage from a virus which infected thousands of employee computers in mid-August but the control systems and oilfield data are unaffected, sources familiar with the matter said.

Tony Hayward Gets His Life Back

Two years after being shown the door at BP, in one of the most ignominious corporate exits in recent memory, Mr. Hayward is back in the oil game. Not at an oil major like BP nor, for that matter, in the gulf, where oil rigs and refineries were being tested anew last week, this time by Hurricane Isaac. No, Tony Hayward is hoping to strike it rich in, of all places, the oil fields of northern Iraq.

Why would anybody believe in "Peak Oil"?

Who of you believes in 'Peak Oil' i.e. specifically the notion that almost certainly in this decade the all-time oil production peak will occur and thereafter we will be in continuous decline?

A couple of questions:

1. Of all the oil that has been discovered in the world, roughly what % has been produced? The answer is ~10%!?

2. What is the global average recovery factor for fields currently in production? Some would have it as low as around 22%!

Peak oil production prospect is frightening and controversial

Last week I tried to relate the prediction of the CEO of a company that has more global oil production data than any other I can find. Dave Demshur of Core Labs says we are now at the maximum possible oil output of the planet. And, it will not get higher — ever! The popular term is “peak oil,” and the concept is very controversial.

My emails reflected no concurrence, mostly denials and a couple in angry disagreement. Personal beliefs aside, can each of us ignore how our lives may change if the “peak oil is now” analysis is correct?

Iran Warns of Oil Price Hike

The current embargo on Iranian oil and political pressure on the Islamic Republic will result in higher oil prices on international markets, Petroleum Minister Rostam Qasemi said.

Iran to Use 18% of Stabilization Fund for Oil, Gas Industry

Iran is to spend 18 percent of its stabilization fund for the development of the oil and gas sector, Petroleum Minister Rostam Qasemi said.

Iran in Talks with Russian Oil, Gas Companies - Minister

Tehran is conducting negotiations with Russian companies about cooperation in the oil and gas sector, Petroleum Minister Rostam Qasemi said.

There are no immediate plans for joint projects in the country, however, he added.

Airstrike in Syria kills at least 18 people

BEIRUT – Government warplanes bombed a town in northern Syria on Monday, killing at least 18 people, activists said, while the new U.N. envoy to the country acknowledged that brokering an end to the nation's civil war will be a "very, very difficult" task.

Suicide attack targets U.S. Consulate vehicle in Pakistan; no staffers killed

Islamabad, Pakistan (CNN) -- An explosives-filled car slammed into a U.S. Consulate vehicle in the Pakistani city of Peshawar, killing two Pakistanis and wounding two U.S. consular staff, authorities said.

Staying in Afghanistan: Where’s the sense?

Since Sept. 11, 2001, we have spent hundreds of billions of dollars on the Iraq war. Forty-five hundred members of our armed forces have sacrificed their lives. Nearly 32,000 American troops have been wounded on the battlefield of Iraq. And yet this is the news that greeted America this spring: “Syria and Iraq Eager for Cooperation with Iran in Building Joint Gas Pipeline.”

Shell shuts Nigeria pipeline after spill

An oil spill from a pipeline running to a flow station in Nigeria has led Anglo-Dutch supermajor Shell to shut-in the pipeline.

The company said that oil which spilled from the line has been contained and there has been no environmental damage. It did not, however, give an estimate of the amount of oil spilled.

Buckets Of Gasoline Found Inside Philadelphia Garage

According to sources, when police and fire crews arrived, they found at least 50 containers full of gasoline in the garage. Some were stored in approved containers but many, sources say, were not.

...Late Friday, a man, who only identified himself as the homeowner’s son, told Eyewitness News off camera that he did not realize he was doing anything wrong. He went onto explain that he was just buying cheap gas wherever he found it and storing it in his garage to save money.

Volt monthly sales to hit record in August

NEW YORK (CNNMoney) -- Chevrolet Volt's August sales are expected to set a monthly record for the General Motors plug-in hybrid.

GM spokesman Jim Cain said the company expects the Volt's August sales to top 2,500, the best month by far since its December 2010 launch. That would mark a 35% increase over July sales and more than a 700% jump from year ago results.

Meet Corb Lund: Canada’s singer-songwriter cowboy

Survivalism and the rural-urban divide is what is being addressed on the album’s first song, Gettin’ Down on the Mountain, right?

It certainly is. They say that if the trucks stop rolling, most major cities would be out of fuel in two or three days.

I’m not really an apocalypse maniac or anything like that. But I read a lot of history, and that stuff comes quick.

It happened in Argentina in the eighties, and Germany in the thirties.

Old burns slow new fires across Idaho

The many fires that have burned from the Boise Foothills to Lolo Pass in the past 25 years have restored much of the landscape to its condition during the early 1900s, before the federal government launched a policy of putting out all forest fires, said Dick Bahr, a fire ecologist for the National Park Service. That policy began crumbling in the 1970s when managers started strategically allowing some back-country fires to burn.

Millions of acres have burned, reducing fuels across large swaths of the landscape and making it easier to fight new blazes, even when they get as big as the three major fires burning in Idaho today, experts say. But the climate is warmer and drier than in the “Little Ice Age,” from 1400 to 1900, when the trees that have burned germinated.

Drought-tolerant seeds coming in few months

BOONE, Iowa – The holy grail of seed companies — drought-tolerant corn — will reach farmers in the next few months, offering hope should record hot, dry summers return.

Re Tony Hayward Gets His Life Back

From the article:

Mr. Hayward was poleaxed. He’d spent his entire career at BP, slowly working his way up only to lose it all after three short years as chief executive.

Aw, poor guy! IMHO he should have ended up spending a few years like this.


Link up top: Why would anybody believe in "Peak Oil"?

1. Of all the oil that has been discovered in the world, roughly what % has been produced? The answer is ~10%!?

That is a very good reason for not believing in peak oil, if only it were true. Of course they are counting bitumen, oil sands and the kerogen of the Green River formation and other places. It also assumes those vast reserves claimed by Middle East OPEC countries is real. Actually somewhere in the neighborhood of 50 percent of all oil that will ever be produced has already been produced. I believe it is well north of 50 percent but have no way of proving that.

2. What is the global average recovery factor for fields currently in production? Some would have it as low as around 22%!

Some might have it that low, most wouldn't however. Production rates vary from field to field for geological reasons but very few fields, if any, would actually be that low. The author of the piece uses Norway and the UK as examples of areas where EOR is greatly increasing recovery rates. Be that as it may the North Sea is declining at about 7 percent per year, an that is in spite of all new oil that occasionally comes on line and any and all EOR procedures that are being undertaken.

Also all forms of EOR has been in use for many years now. Peak oil predictions already takes EOR into account. Declining nations are declining in spite of heroic EOR efforts.

The question is: Why would people not believe in Peak Oil? Well one reason is they are being fed figures that are unbelievably wrong for one reason. Another reason is they are looking at such things as EOR, so-called proven reserves that really don't exist. They are counting oil sands, bitumen and kerogen as oil as if they could easily and economically be produced. And of course they never look at flow rates, the real indicator of oil production ability.

Basically they don't believe in peak oil because they haven't a clue as to what they are talking about.

Ron P.

In order not to "believe" in Peak Oil, one has to believe that the sum of the output of a group of oil fields that individually show clear production peaks, e.g., East Texas, Prudhoe Bay, Cantarell, etc., will not show a clearly defined peak/plateau, followed by a decline.

This belief that the sum of a group of discrete oil fields that show production peaks, but which will collectively not peak, is analogous to the following:

Let's take 1,000 people of various ages, who are all currently employed and let's look at their combined earned income (from their jobs), ignoring items like investment income and retirement income, etc. Let's plot their combined income, from the first dollar of income, as the first person goes to work, to the last dollar of income as the last person quits work and/or passes away. Each person will in all likelihood show some kind of income peak, or "Undulating Plateau" in income, followed by either a gradual decline, or an abrupt decline, depending on why their income is curtailed. But to not "believe" in Peak Oil is analogous to believing that a finite group of people, with finite lifespans, will not show a peak in their combined earned income.

But of course the "Peak Oilers," who "believe" in the finite earth theory, are widely considered to be the crazy ones.

Have you heard of Green Freedom? It will turn air and water into fuel. The first plant is in West Texas! Either this will make us energy independent or Mitt Romney will by 2020 (he said so last month).


Yeah, great! Two nuclear engineers claim to have developed an electrochemical process for recovering CO2 from the atmosphere and also producing Hydrogen from water at the same time which they can then convert to fuels such as gasoline through the Fischer-Tropsch method... and all this requires 96% less energy than other known processes for recovering CO2 from the atmosphere! Let me guess, this amazing electrochemical process is a close cousin of cold fusion, right?

I'm betting on Mitt Romney's energy independence proposal by 2020 over this one!

Mitt did drive a car made by Canadians in his Detroit ad (my find).


Mitt will "get us the Canadian oil we deserve."


It's certainly true that if we have a sufficiently large energy input, along with a lot of capital, we can synthesize large quantities of liquid hydrocarbon fuels.

Exactly. While the author's definition of Peak Oil shows a glimmer of understanding, none of the data he submits has any bearing on extraction rates. If you don't understand that Peak Oil is about extraction rates, you shouldn't be writing about it!

"Peak Oil" is a direct conclusion from the fundamental theorem of calculus.

So much so it borders on tautology.

His argument about the various sources of kinda-sorta-oil that we're not exploiting can only defer the date of the global maximum in oil production, not deny its existence.

Ron – “What is the global average recovery factor for fields currently in production? Some would have it as low as around 22%!” And from you: “...vary from field to field for geological reasons but very few fields, if any, would actually be that low.” I can’t offer a weighted average for Texas let alone the rest of the planet. But I’ve worked on many fields in Texas with URR of 15% or less of inplace reserves. And a great many more with 25% recoveries. But remember that for much of my career as a development geologist/reservoir engineer I’ve been drawn to fields with lower recovery factors and large residual reserves.

But let’s look at the higher recovery fields I’ve worked. Fields with 50% to a few rare ones with 70% recovery. Right now I’m working on the horizontal recovery of residual oil from fields where a 50% recovery is common. You and others have pointed out the mistakes many cornucopians make by equating reserves with production rates. The high recovery fields I’m working are freaking dogs when it comes to production rates despite their high recovery factors. And were dogs almost from the first days they went on line. And we’re not talking small numbers: just this one relatively small Texas trend has produced over 4 billion bbls of oil. There's another shalow oil trend in S. Texas that has produced over 6 billion bo with a typical recover rate kess than 25% with no viable method for EOR.

The problem: the oil, though of premium quality, is thick. Combined with the poorly consolidated nature of these sandstone reservoirs and a strong water drive initial production rates were low: 50 - 70 bopd per well. And it quickly got worse as water production started within months. About 70% of that 4+ billion bo was produced at a water cut of 80% or better. It typically took 20+ years to just recover half of their URR. And a very large percentage of those wells are still producing today...at a few bopd per well.

Thanks to improved tech, such as hz wells and frac’ng, recoveries will be better in many fields developed today. More important, production rates will be much better. But that can also lead to false illusions. Consider the DW GOM fields where URR range in the 100’s of millions of bbls. So while recoveries may ultimately be relatively high they are developed to max flow rate and not URR. Some DW GOM fields may recover as much of the inplace reserves as some of our old heritage fields but do so in less than 10 years. Good news/bad news: a nice rate bump to give the appearance of “fixing” the PO situation but will be gone before many even realize it’s happening.

Thanks Rockman. I have a very important question that I need an answer for, from an oilman like you, or anyone else who might know the answer. Can we use EOR methods to get more oil from already depleted water flooded fields? If so, what kind of recovery percentage are we looking at?

Thanks in advance.

Ron P.

Ron - Just found this from the Bureau of Economic Geology, Un. of Texas: http://www.beg.utexas.edu/UTopia/images/pagesizemaps/oilgas.pdf

"On average only 35 percent of original oil in place in Texas reservoirs has been recovered.” This includes all EOR efforts. So as of 2002 of the 60 billion of oil ever produced in Texas about twice that much has been left in the ground despite best efforts. Given the large EOR projects that have been running in Texas (especially in W. Texas where CO2 floods began about 40 years ago) for many decades the primary recovery rate must be a fair bit lower than 35%. How representative is that of the US? Texas oil production has accounted for 1/3 of all US production (180 billion bbls). How representative of the rest of the world? I have no idea. I suspect a poorer recovery factor in Texas than the N. Sea but much better than Venezuela.

Tertiary recovery efforts? I’ve never worked on one directly but the reports I’ve seen offer possibilities in the range of just a few percent to 10% over a significant amount of time. Of course, a few % of the huge amount of proven residual reserves in the world is a huge number itself. OTOH such expectations can’t be applied to every field for technical and economic reasons. Even my hz redevelopment is hoping for an increase of 5% to maybe 10% if I’m very lucky. But I can’t apply the approach to all those 4+ billion bbls of residual reserves for economic and tech reasons. So for the entire trend, if we drill every feasible well: less than 5%...maybe just a couple of %. And while the nature of these water drive reservoirs make the technique potentially applicable there are many where it wouldn’t work at all.

Currently a CO2 pipeline is being laid from Houston to one of these larger fields that’s up to about a 99% water cut. How successful will it be? No idea but I‘m not overly optimistic. And I might say the same for the operator of the field: they wouldn’t agree to the project unless the US tax payers footed $120 million of the total $160 million. In fact, I have a number of other EOR projects I wouldn’t mind having a fling with…if someone else paid for 75% of the costs. Those S. Texas pressure deleted oil fields (with billions of bbls of oil sitting under open leases) I mentioned could really do well with CO2 floods. Just need someone to spend the $billions needed to get the gas to them as well as drill the thousands of wells that are needed to replace the ones abandoned. That’s a factor many EOR cornucopians don’t recognize: much of the original infrastructure no longer exists and must be replaced in additional to the capex for the EOR effort itself. I know of a number of offshore GOM reservoirs where hz drilling could recover a lot of commercial oil. But the platforms have been removed and replacing them kills the economics

You got a pet project in mind your Uncle can help you with? LOL.

OTOH such expectations can’t be applied to every field for technical and economic reasons

Exactly. Anyone notice that in the article he slipped in "technical reserves"? Well, sure, technically we can mine unobtanium on the moons of Pandora. How in the world that actually pencils-out economically is a whole 'nuther ballgame.

Look on the bright side, all those stripper wells should keep our military chugging along for a good while yet (good news for everyone around the world living under the watchful eyes of robotic drones!). Everyone else can get in line.


I've seen up to 62% recovery on primary production, 80% on secondary recovery (waterflood), and 94% on tertiary recovery (miscible flood using NGL's).

These were very unusual reservoirs, though, typically vuggy carbonates with interconnected vugs.

Most people here will be saying, "What?" whereas Rockman will be saying, "Why don't I have any fields like that?"

They are rare, very rare.

Typically oil recovery rates on conventional oil fields are 25-30% world wide. In the Canadian oil sands though, recovery rates range up to 60% on thermal wells and 99% on mining operations. And the total size of the oil fields is about the size of Florida. It just takes a long time to develop. Much longer than anybody here is going to live.

Rocky - I bought a field from Shell Oil where I is suspect the recovery was 90% or better. Drilled and logged two wells through the dozen oil reservoirs they had been producing for many decades. Water saturations in those zones calculated very close to 100%. Shows you how much oil you can get out if you're willing to lose money in the process. LOL.

They may have produced the field 10 or 15 years beyond economic limit. And for good reason: the complex was in the middle of the Atchafalaya swamp and consisted of millions of pounds of steel reinforced concrete. A 3 story complex just a tad smaller than a football field. I can't begin to guess the tens of $millions it would have costs to take it out. And then the final environmental audit before abandonment. Doesn't that thought send a shiver up you spine? LOL.

Though the field was still doing about 500 bopd it was producing an obscene amount of water. How high was the water cut on some wells? About 3 months after I took over a flow line cut out in the middle of the night. Bad news: the entire production stream went into the swamp all night long. The good news: there was so little oil coming out of the well it didn't even create a sheen on the water. FYI folks: it only takes a few tens of parts per million to make an oil sheen. The water cut must have been something like 99.999% or worse. My idiot managers accepted the numbers Shell put out for remaining reserves and wouldn't listen to me and my engineer. They told me to drill 6 hz wells that summer. I told them I needed to drill a couple of vertical pilot holes so I would know how to geosteer the hz wells. I didn't, of course, but they were too ignorant to see that. My 2 pilot holes destroyed 100% of the "proved" residual oil. The only oil left to produce in the field was the current production which was losing about $80,000 a month to keep flowing. Fortunately another operator made a deep discovery close to our field and we were able to sell it to the next fool. BTW: that new deep discovery didn't pan out too good either.

Our engineers always wanted to know if their individual wells were making or losing money, which is difficult to determine on a well-by-well basis since it involves a lot of assumptions and allocations of costs.

However, under Canadian rules, the abandonment and reclamation costs for non-producing wells had to be reported as a liability on the books and in the Annual Report. Also, the Proven Reserves held by non-producing wells became Unproven and we had to take them off the books.

This went over badly with the accountants, so they wanted us to abandon non-producing and low-producing wells and get them off the books ASAP. In fact sometimes we would send a "Proposal to Abandon" letter on low-production wells to partners just to motivate them. We'd never send a "Notice to Abandon" letter because we wanted to keep our options open. Often times the partners would proposed some kind of scheme to get the wells producing again in which they paid most of the costs. Other times, the partners would buy out our interest in the wells and do a rework on them themselves, which eliminated our liabilities.

The water cut on some of these wells might be 99%, but there was still a sheen of oil on the water and they could sell it at a profit. This could go on for a long, long time.

One classic case was the old Leduc field, which was the first big oil discovery in Canada, found in 1947 (much later than most of the US big discoveries). Some years ago the operating company put out a notice saying it had produced all the oil it could, and that the next year it was going to blow down the gas cap on the formation (produce all the gas as rapidly as possible, before water could flood in and strand the gas) and abandon all the wells.

The next year the operator said the blow-down had been deferred until the
following year. The following year, the operator said it would defer it until the year after. The year after, it said it would be deferred another year. The darn wells just wouldn't stop producing oil.

This went on for some years. Eventually, they did blow down the gas cap and abandon the wells, but I think there are still some wells operated by other companies producing in the corners of the field. It's amazing how small companies with low overheads can keep old oil wells producing.

Hi Rockman

In The Effect of High Oil Prices on EOR Project Economics, Sean McCoy and Ed Rubin of Carnegie Mellon model EOR projects. They assume:

"In all of the cases, the necessary injectors and producers were assumed to be available from secondary production and require only workovers for conversion to CO2-flooding."

See also: A Survey of CO2-EOR and CO2 Storage Project Costs 2010 SPE 139669-MS, DOI 10.2118/139669-MS

Other than available CO2, is there anything else you see that they missed?

Any recommendations for good sources of current costs for completing new injectors and producers?
e.g. Generalized Functional Models for Drilling Cost Estimation, 2007 SPE-98401-PA (cited by 11 others.

David – For a meaningful answer I have to model some assumptions. Reservoir depth: 5,000’ – 7,000’. Completed producing well cost: $1 million (more than normal because of the need for chrome casing because of CO2. Injectors $1.5 million. The special compressor to get the CO2 up to injection pressure (rather expensive). But those cost estimate don’t capture the total investment how many $millions, tens of $millions or even hundreds of $millions for the pipeline to get the CO2 to the field. How many tens of $millions to buy the CO2 and operate the field?

But there’s an easier answer IMHO: the folks who own the fields where CO2 flooding would work know what these numbers are and have a rough idea of how effective a CO2 might be. With that info and some reasonable estimate of oil prices they’ve already made the decision to either do a flood or not. If companies haven’t started efforts to flood their fields with CO2 with the high oil prices we’ve had for a while why should we expect a big push in that direction?

And then there’s a fact that many EOR cornucopians refuse to acknowledge: a great many EOR projects have been conducted in some of biggest heritage fields for decades. Some have the giant W Texas fields have been undergoing CO2 floods for more than 35 years. And some have been water flooded for over 50 years. This is one of the reason the US is the third largest oil producer on the planet…something else some cornucopians don’t appreciate.

How high of a negative price on CO2 would it take to make these sorts of plays economical? If we actually ever someday maybe decide to capture and sequester CO2, I imagine they will be paying a price per tons for those who inject it underground.

eos - Even if I were a lot smarter on the subject I don't think I would offer a guess. Just too prospect specific to come up with "the number" IMHO. And so many other big factors besides the price (credit) for a volume of CO2. Did you catch my note about a CO2 line being laid from Houston to an old water drive oil field about 100 miles away. Total cost just for the line: $160 million. But the operator of the field wouldn't sign on to the project without the tax payers chipping in $120 million of the cost. I've seen nothing as far as who is supplying the CO2. And if they are seeling it to the operator or getting some tax credit. It muight be free for the operator...except, of course, for the $160 million pipeline and the $millions for the injectors and operating expenses.


I am sure you have seen this video from ASPO. At the 4-5 minute mark Jeremy Gilbert(former head of production for BP) talked about using EOR for existing fields. He says it would be very difficult to retro-fit existing fields.



Yes, I have seen that video and that is exactly why I asked the question. And thanks Rockman for your reply. So the answer is "some to none". And any oil produced from very old water flooded fields, which would include virtually all giant fields in the world, could only be produced at great expense and probably would be a money loser unless subsidized by the government.

I am not surprised.

Ron P.

Ron - "...and probably would be a money loser unless subsidized by the government." Probably true for many projects. But $100 oil allows for more opportunities. I tried pitching my hz project first when oil was less than $40/bbl. No go.

A carbon tax might also play a role.

And of course they never look at flow rates, the real indicator of oil production ability.

That in the first place. They just think of how much oil is still left in the ground, even if they know that the Middle East is most probably exaggerating. Also are they counting the stranded oil reserves of which even the U.S. has more than 100 Gb. Oil that could be extracted with CO2 EOR. For the Peak oil issue this isn't important, because CO2 isn't amply available and flow rates will always be very low compared to the amount of oil still out there.

Han - As far as residual oil in the US I just pulled up some interesting numbers. Texas has produced 60 billion bo. According the Bureau of Economic Geology, Un. of Texas, the recovery rate had been about 35%. That means Texas alone has 120 billion bo left in the ground. The US has produced 180 billion bo. I don’t know if the US RR is comparable to that of Texas but why not assume so…just for the fun of it. That would indicate something on the order of way over 300 billion bbls of residual oil sitting under our country. That should be enough to make any EOR cornucopian pee on themselves. LOL.

So the obvious question remains: why has the oil industry been sitting on this huge wealth and not exploiting it? Perhaps just as you imply: if the tools to recover this vast national treasure were available and the process profitable they would have. Very simply ever field in the US that might benefit from any form of EOR has had some method of EOR applied it. This is why every one of us is in the business: to produce FF. I don’t have time to hunt for a more precise number but I would bet a significant amount of oil we’ve produced in the US for the last 30 years has come from fields undergoing EOR. Maybe even the majority. At this point it’s good to remind some folks that the average well in the US produces less than 10 bopd. Thus not difficult to believe that most of our current production comes from old fields. And old fields, if it were applicable, have had EOR projects conducted in them.

After working in the oil patch for 37 years I think I’m qualified to make a few general statements. For one thing, we’re not the most environmentally sensitive group of folks. Nor do we tend to be very politically correct…unless, of course the cameras are rolling. But one thing I can assure you: collectively we are some of the greediest bastards on the planet and do our best to not let anything get between us and making a buck. I cannot express to you how hysterically funny it is to see the cornucopians claim that the oil patch has been so ignorant to leave all that oil just sitting there within easy reach. IMHO not only has almost every field which EOR could be applied has had it applied, I’ve personally seen a number of fields where it was and shouldn’t have been. Yes…some EOR projects have actually lost money. I once saw a water flood project lose over $7 million. As that operator learned, the hard way: water floods (and CO2 floods) don’t work in every reservoir. Another blind spot for some cornucopians: EOR is not some magic bullet that automatically produces residual oil at a profit. It’s true: EOR methods are not s bunch of magic bullets that can profitableyincrease production from every reservoir.

And people don't want to believe in peak oil because the idea that what has been built is by and large going to end up as huge cement garbage is just too painful. "We" couldn't have made such a wrong turn, right?..."We" couldn't have made such a huge mistake as to bet the whole planet and the existence of 7 billion on something that is disappearing......um (gulp!).....right?
"We" are smarter than that....right?
"We" are known for our foresight...our intelligence....our ingenuity. Therefore by definition, no major mistakes, like getting structurally dependent on something without a lasting quality, can be made by us. By definition.

We are incapable of making such a major mistake as to build out structures and ways of life with no way to continue them. We are extremely smart (everyone knows that) so, a major error like that, like an animal species breeding wildly until it collapses, is just not something that is possible for us to do.

We're just better than that. That's all. We just are.

Good one pi. The average person believes that what made this country a great and invincible world leader, was the irrepressible drive and stalwart goodness of her people, not cheap energy.

According to the EIA the price of oil adjusted for inflation was the same in 1999 as it was in 1879. During the intervening years, except for the spikes caused by the 1973 Arab oil embargo, the 1979 Iranian revolution, and a small jump around WWI the price of oil, adjusted to 2006 dollars, essentially bounced around twenty dollars a barrel or less for over 100 years.

We've had a good run for 100 years, and no one alive today remembers what life was like before the era of cheap energy. Folks can read about it in books, (those who read can) but it's not the same. For most human beings 100 years is virtually forever.

So, since things have been going swimmingly since 'forever', they must continue to forever more. They just have to.

The five-fold increase in the real price of oil since the late 90s, despite the fact that it seems to be holding fairly steady, must, therefore, be a temporary anomaly. We need a president who will do something about it! /sarc


The average person believes that because we have been the most heavily and cleverly indoctrinated society in world history. See the work of the late Alex Carey.

Propaganda doesn't work unless you have an ingorant and receptive audience. Your average American voter fits the bill on both counts --willfully and proudly ignorant and utterly in the grip of magical thinking. In many cases, s/he is openly hostile to science, reason and evidence-based independent thinking, in favor of groupthink and blind devotion to mega-churches and "news" outlets that sell what s/he wants: American exceptionalism, optimism, corunucopian fantasies and a mighty pleasant afterlife to boot.

I have my doubts about the U.S. being the "most heavily and cleverly indoctrinated society in world history" though. I'd say Nazi Germany or Stalinist Russia clearly has us beat there.

Yeah. I just finished reading Fool Me Twice: Fighting the Assault on Science in America.
Highly recommended.

A russian friend once remarked that the blatant propaganda of communism was so in your face and obvious that most didn't really swallow it whole, they just played along.

My friend hated the western propaganda because they could see the parallels, but it was much more low key and insiduous. In a way this made it much worse and far more successful.

Comrades - A question I've tossed out to many folks over the years on this subject: Do you know who the best con man (propagandist) in the world is?

The correct answer is, of course, no. That's why he is the best. Just like the man in the movie "The Sting" said: The best con is one when the mark doesn't realize he's been cheated. Its one thing to swallow someone's BS...another not to realize you've been doing so and thus continue the illusion.

Reminds me of Robert Newman's HISTORY OF OIL.. where he talks about the most famous Spy in the world, meaning he must have also been the WORST spy in the world!


You can also fool everyone unnoticed,and then brag about it in your autography when you retiered. Thats my plan.

Just like the man in the movie "The Sting" said: The best con is one when the mark doesn't realize he's been cheated. Its one thing to swallow someone's BS...another not to realize you've been doing so and thus continue the illusion.

So . . . religion then wins.


I have my doubts about the U.S. being the "most heavily and cleverly indoctrinated society in world history" though. I'd say Nazi Germany or Stalinist Russia clearly has us beat there.

The greatest propagandist in the last 100 years or so was American citizen Edward L. Bernays, who wrote:

The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country. We are governed, our minds are molded, our tastes formed, our ideas suggested, largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized. Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society.

Our invisible governors are, in many cases, unaware of the identity of their fellow members in the inner cabinet.

They govern us by their qualities of natural leadership, their ability to supply needed ideas and by their key position in the social structure. Whatever attitude one chooses to take toward this condition, it remains a fact that in almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons — a trifling fraction of our hundred and twenty [now 320] million — who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind, who harness old social forces and contrive new ways to bind and guide the world ... It is the purpose of this book to explain the structure of the mechanism which controls the public mind, and to tell how it is manipulated by the special pleader who seeks to create public acceptance for a particular idea or commodity. It will attempt at the same time to find the due place in the modern democratic scheme for this new propaganda and to suggest its gradually evolving code of ethics and practice.

(The Ways of Bernays, quoting from his book "Propaganda"). He was the inspiration of the NAZI officer Goebbels:

Bernays work inspired Joseph Goebbels; more than any other individual ... Karl von Weigand, foreign correspondent of the Hearst newspapers, an old hand at interpreting Europe and just returned from Germany, was telling us about Goebbels and his propaganda plans to consolidate Nazi power. Goebbels had shown Weigand his propaganda library, the best Weigand had ever seen. Goebbels, said Weigand, was using my book Crystallizing Public Opinion [written by Bernays] as a basis for his destructive campaign against the Jews of Germany. This shocked me. ... Obviously the attack on the Jews of Germany was no emotional outburst of the Nazis, but a deliberate, planned campaign.

(Exceptional American Propaganda Inspired NAZI Goebbels). One of Bernays' first jobs as a government official was to turn U.S. public opinion from being against WW I to being for U.S. involvement in WW I. He also changed public opinion that was against women smoking to being for women smoking.

He is called "The Father of Public Relations" ("PR"). He worked in the industry described by Adam Smith as:

"One of the most important comments on deceit, I think, was made by Adam Smith. He pointed out that a major goal of business is to deceive and oppress the public.

And one of the striking features of the modern period is the institutionalization of that process, so that we now have huge industries deceiving the public — and they're very conscious about it, the public relations industry. Interestingly, this developed in the freest countries — in Britain and the US — roughly around time of WWI, when it was recognized that enough freedom had been won that people could no longer be controlled by force. So modes of deception and manipulation had to be developed in order to keep them under control" ...

(ibid, The Ways of Bernays, quoting Chomsky). I would seem that Michael Dawson was on to something.

Wow, thanks for the history lesson in propaganda. So, if Edward L. Bernays is the world's best propagandist and literally wrote the book on it, that means...

We're #1, WE'RE #1, WE'RE #1, WE'RE #1!!!!

HARM, (and wiseindian too),

Of course that is the secular side of it.

Interestingly there is also a religious side of it that goes back farther in time, yet is affecting the presidential election in the sense that falsehoods are being yelled about in the media:

D. Michael Quinn called the use of deception by LDS church leaders, "theocratic ethics." (The Mormon Hierarchy: Origins of Power, page 112) Smith lied to protect himself or the church; which was an extension of himself. Dan Vogel in his excellent work, Joseph Smith: The Making of a Prophet, described Smith's viewpoint; he was a pious deceiver. Smith used deception if in his mind; it resulted in a good outcome. Smith had Moroni, an ancient American prophet and custodian of the gold plates declare, "And whatsoever thing persuadeth men to do good is of me; for good cometh of none save it be of me. ( Moroni 4:11-12). Translation: if deception was necessary to do good, or bring a soul to Christ, then it was worth it, as long as God approves. Smith believed he knew when God approved of lying.

(The Homeland: Big Brother Plutonomy - 6, quoting an LDS writer). We simply must try harder as a nation to rid ourselves of such things because we can't operate accurately on fantasy.

Psychology...particularly the aspect that is not discussed in public is fascinating. Reading about Bernays has been an eye opener.

Good stuff, I had never read Bernays.

Whatever attitude one chooses to take toward this condition, it remains a fact that in almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons — a trifling fraction of our hundred and twenty [now 320] million — who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind, who harness old social forces and contrive new ways to bind and guide the world ...

This is what I've been saying about pro-earth activism. (Well, a subset of what I've been saying).

It's obvious that this is true, yet some capuchin-monkey part of us tends to resent acknowledging the reality and is pissed-off at those who use it; it's dissonant to our sense of egalitarian process and "fairness".

Thus, this value-neutral reality - of the actual structure of societal decision-making - is consciously avoided by idealist-advocates, who focus on fairness of process and purity of heart. This effectively cedes the only workable methods of steering a democracy to those who are more likely to be unabashedly selfish or to seek personal power as an end in itself.

Thus we have very-sincere wankery as state-of-the-art earth-activism. It is rare for a person to both care about the world's future to the point of acting on it, while being willing to employ methods which somehow seem uncomfortably less than straightforward. This is a huge problem at the root of the "environmental movement". And indeed, even in that "movement" there are a few unseen movers who accomplish what progress is achieved, and make it look like the will of the masses. An unseen machiavellian pulling the strings to make it work, despite some resentment from the evangelizing idealists around them who cultivate a self-congratulatory Gandhi-like self-image, a deep passive-aggressive egomania in the guise of virtue.

While this is discouraging, it's actually good news in the present context, because it means that earth-advocacy is currently so ineffectual that there's a lot of room for improvement, AND it means that an individual with a systems perspective can be hugely more effective than he or she might initially think, if they are willing to be a little bold.

I'm at work, so I can't think too much, but here's a quick reply:

Julian Assange has been very effective at exposing the secret workings of our so-called free and open society. Look where it got him.

What will become of the bold, effective activist that threatens the power structures of today?

Will the powers that be react like a Russian fishing trawler or a Japanese whaler? A tip of the hat and a "You win"?

Hell Fire missiles (great name, eh?) await the improved activists of the middle east who advocate against what we say want or think.

Bernays was smart. I don't have an answer (yet).

Julian Assange has been very effective at exposing the secret workings of our so-called free and open society. Look where it got him.

What will become of the bold, effective activist that threatens the power structures of today?

He may have made a few rookie mistakes, but why is it a conceptual problem that he paid a price? He's just one guy. Anyone engaging seriously enough should not expect to survive it unscathed, or perhaps even survive it.

Moreover, part of the lesson is that the power structures we see aren't necessarily the most powerful or the easiest to influence.

Will the powers that be react like a Russian fishing trawler or a Japanese whaler? A tip of the hat and a "You win"?

Yes, that is exactly what they will do, when it's played right. They tip their hat and let you help write their press release so it looks like it was their idea. Really.

Yes, that is exactly what they will do, when it's played right. They tip their hat and let you help write their press release so it looks like it was their idea. Really.

Hence his victories bring him neither reputation for wisdom nor credit for courage.

Ha. Great.

I haven't read Sun Tzu, but he and I may have had similar experiences.

Its an ancient classic. He was Machiavelli two thousand years earlier. A fairly thin book, shouldn't take you too long to read. But, given your philosophy on pushing environmental stuff, I think you could relate -and possibly learn a thing or two. There is also an hour long TV documentary on The Art of War, that you might have caught.

I've heard of the book, it was a fad in business circles some years ago, and I consciously avoided it. I should probably write down my stuff before being influenced by his. All my methodology is derived from personal experience, and works very well. It's always good to work things out from first principles and your own experience and then find that other intelligent folks have come to similar conclusions.


The ideology of Sun Tzu, the Chinese General, has replaced the ideology our forefathers in the teachings done in The War Colleges of the U.S. military.

This brings out an ideological conflict (Is War An Art or Is War A Disease?), as well as exposing what General Wesley Clark (NATO commander) and others ex-officio called a Coup (A Tale of Coup Cities).

This brings out an ideological conflict (Is War An Art or Is War A Disease?),

Since I don't believe Greenish was involved in armed conflict, I meant 'War' in a metaphorical sense, especially when it comes to ideas or memes.

I certainly think that getting large groups of people to change how they view the world and their place in it, is a high art!

Actually, I've fielded projects in active war situations. When we were working to get the Kuwait oil fires shut down my guys had a large Russian machine gun set on our desk in the main lobby of the Kuwait Hilton, and coordinated getting international media through the minefields, etc. And there have been invasions of various countries, etc. But my guys generally haven't been the ones with the guns.

In the real world, you don't always need metaphors...

just sayin'

(here are two of my team members on the cover of Nat Geo. Pretty much all media coverage on the ground in the first month of the war featured our team members, since they were the only ones able to get the media in.)

Thanks for sharing Greenish.

I don't necessarily disagree with these points.. I guess my question is, 'who are your heroes now?'

Who has worn the mantle of power well?

Who has used the tools of persuasion and maybe even manipulation towards better ends?

I think this takes us back to King Arthur again and again, both the story of the Reluctant Hero/Leader, and that of the "Might FOR right" of the Round Table, the ideal of challenging the 'Might makes Right' that reconquors whenever it can.

“I believe that there is one story in the world, and only one . . . . Humans are caught—in their lives, in their thoughts, in their hungers and ambitions, and in their avarice and cruelty, and in their kindness and generosity too—in a net of good and evil... and it occurs to me that evil must constantly respawn, while good, while virtue is immortal.” John Steinbeck

(That view will undoubtedly earn a sniffle or two with this audience. I think it may require a little more clarification still, but I'm happy enough to leave it there.)

I don't necessarily disagree with these points.. I guess my question is, 'who are your heroes now?'

Who has worn the mantle of power well?

Who has used the tools of persuasion and maybe even manipulation towards better ends?

What, you want me to rat them out?

They need their anonymity, and there are damn few currently alive. I have been one of them (that is, highly effective, not my own hero), but have physical limitations which now make it harder to engage. So from time to time I drop pointed hints among smart people.

For historic examples, I actually think Gandhi is good. What he projected and the way he planned were quite different. It takes a fair bit of sneakiness to come off that good and get anything accomplished in the world.

Since Got2Surf mentions the whaling issue just above though, I can mention a couple dead ones from the whale issue. Bob Hunter was a great PR manipulator with a great sense of humor, who could make the media dance with newly-created mythology even in the absence of substance. Absolutely a pure and wonderful human, and machiavellian to his very-stoned core. He was very good at communicating with the illogic of the core human mind, he understood the power of linking a stark image with a new concept and exact timing, and he understood that the media has no significant control over what it covers.

An entirely different sort of realist was the architect of the whaling ban. David McTaggart was a sneaky bastard who would sell you out for any reason in the service of his goals, combative, opportunistic, and manipulative. Yet he chose pro-earth goals. He was the one who inserted himself into the yammering wacko crowd and started shrewdly playing the IWC game by the same rules the whalers had, doing whatever had to be done to build a voting majority to block the rubber-stamping of whale-killing quotas by the very-corrupt corporations who ran the commission. That victory like any other environmental victory was temporary, but it bought a couple decades of relief when it was desperately needed.

Those sorts of folks have a hard time inserting themselves into more mature organizations, which administer themselves into mediocrity and stifle any sort of individual initiative while sucking up the majority of public financial support.

Don't doubt that the inspiring idealistic success stories have bribes, hookers, blackmail, misdirection etc in their causative chain of events. It's a real goddam world out there with real-world dynamics, not some "thought experiment" for intellectuals.

All of this brings to mind Asimov's Foundation series --which was all about manipulating the masses through carefully staged political events, wars, "disasters" and subtle propaganda. The aim was to restore rule of law, peace and democracy to the future galaxy. Sadly, in our world, most of the really talented puppetmasters work for the dark side.

Unfortunately, psychohistory ain't real... but there are ways of analyzing things which can give one quite an edge in the short term.

But I do resonate with the "Foundation" concept. Indeed, as I've said here a few times, my own focus is the earth 1000-500 million hears from the present. That is, trying to help steer what gets past the human-overshoot/fossil fueled bottleneck, and what shape is the earth in by then. I think that should be the highest concern of any thinking citizen of the earth, but then I'm odd that way.

Sadly, in our world, most of the really talented puppetmasters work for the dark side.

True, and it's because the earth-advocates generally don't care enough about the world's survival to sully themselves. As you may be able to tell, I've had it up to my eyebrows with "shallow green" hand-wringing.

You certainly have a long time horizon. Even without the machinations of homo-antisapiens, there is a good chance the planet won't habitable that long. Whether it be an instant catastrophe, such as an asteroid impact, a supernova or gamma ray burst, or the gradual brightening of the sun leading to a runaway greenhouse effect there are a lot of things that could go wrong. I tend to think long term, but my long term is 50 to a million.

Well y'know, even if we saved it and it only lasted another 50 million years, I'd consider it worth doing.

I think 500 million is a reasonable outside guess in terms of when the sun will cook the earth by expanding, but it's hard to be closer than that. The life of the planet seems to have been pretty resilient to gamma bursts and asteroid impact in the past.

The salient difference is probably really whether to focus on short-term human travails, or what gets past the imminent human overshoot pyromania event of the next several hundred years, which is heavily front-loaded. Once humans are down to whatever carrying capacity is left to us, our mischief will tend to be more limited.

I tip my hat to your 50 to a million.

I enjoy taking the very long view, too. Five hundred million years is pretty extreme, though, even for me. Our species could rise and fall many times in one million years. Odds favor a good many mass extinction events over the course of 500 million years -- asteroid/comet impacts, super volcanoes, and yes, runaway greenhouse effects. Of course, a supernova a hundred light years away could wipe our planet clean tomorrow (there would be no warning).

Half a billion years is enough time for evolution to practically start from scratch. Almost anything could happen, literally...

Our species could rise and fall many times in one million years.

I agree, just keep in mind that modern humans have been around maybe 200 thousand years and only had a mere 10 thousand years of civilization. Our close cousins the Neanderthals probably became extinct about 100 thousand years ago and if we look back a mere 5 million years we encounter our early ancestors such as Australopithecus. A million years into the future there may be life on earth but to assume that any descendants of civilized great apes will still be around is certainly not a given! And Homo sapiens will not be around at all! Maybe some Hobbits. >;-)

I'd say let's just try to concentrate on the next 100 thousand years of human civilization and a much better stewardship of our little blue green planet!



Not to nitpick Fred but the Neanderthals went extinct a mere 30,000 years ago.

No one can predict the future but it seems logical, given the adaptability of Homo sapiens, our huge numbers and the fact that we occupy every habitable niche on earth, that we would be the last of all megafauna on this planet to go extinct.

Ron P.

Hi Ron ~
As to Neanderthals, what do you think about the cross breeding theory? I mean, just look at some of the people around today...

Well there was a study that concluded we have 1 to 4 percent Neanderthal DNA in us but I would question that. I would think it is possible that that much DNA could have survived from the time when we had a common ancestor with the Neanderthal. But of course that is only my opinion and I am far from an academic in that discipline.

Ron P.

Hard to know how serious to take it, but I had a million or so genes sites sequenced since I got a deal on it - so far is hasn't proven very useful, but it did note that my sequenced DNA is 3% neanderthal, which apparently is a bit above average.

That new study of the Denisovan girl showed that Asians and South Americans actually have more Neanderthal DNA than Europeans. They're not sure what it means, but it suggests we still have a lot to learn about our origins.

As to Neanderthals, what do you think about the cross breeding theory? I mean, just look at some of the people around today...

Only have to look at the former German football goalkeeper Oliver Kahn.

Please, do not insult the Neanderthalers: They may have been as "ugly" as O. Kahn, however, there is plenty of eveidence that they were really intelligent. :-)

Agreed. Many believe they are the same species as we are. Especially after some of the more recent DNA analysis.

I can just imagine those neanderthals discussing how ugly those "others" are with their weak bones and plain faces.

Not to nitpick Fred but the Neanderthals went extinct a mere 30,000 years ago.

Yep, you are probably right. What I should have said is they were still living about 100,000 years ago!

given the adaptability of Homo sapiens, our huge numbers and the fact that we occupy every habitable niche on earth, that we would be the last of all megafauna on this planet to go extinct.

I don't think that's a given at all!

Well, given our discussion the other day I know you disagree but my point is Homo sapiens continues to evolve and will probably become extinct as a species regardless. Much like the Neanderthals. The genus may survive for quite some time.

Being raised on science fiction, I'm with you all the way, and then some :-)

Personally, I'm rooting for the octopus, heh.

Here's a science fiction notion for you - what if there has already been a sentient octopus species? They have been around for over a third of a billion years. They could have had IQ's of 500 and a non-technological civilization which lasted millions of years, only to ultimately die out. They leave no fossils. Let's not assume that evolution has a preferred direction; there's utterly no reason to think that todays' octopus are the smartest which have existed. The ones we see may only be the remains of the solar system's most intellectual species. More likely to have happened in the past than in the future. Likewise, our descendants a million years hence, if we leave any, may be no more intelligent than a possum.

Yet I've never heard another person speculate about the fact that octopus could have preceded the mammals to self-awareness and complex abstract thought by hundreds of millions of years, and simply run their course.

Our species could rise and fall many times in one million years.

Firstly, this is anthropocentric silliness ... species do not "rise and fall" - they continue (perhaps evolving slowly or not) - or they go extinct. Nothing rises or falls.

And secondly, a million years is an eye-blink in the scheme of things, and there is not a lot of evolutionary change in such a short time-frame. Even our own genus (and certainly family) have been around about six million years, and there hasn't been really huge change (other than brain capacity).

Maybe I should clarify... I'm not saying that I predict that the species we know will last 500 million years, just that life should, and the nature of that life will be - duh - determined by what survives. In particular, what survives the current mass extinction event which has yet to play out. Perhaps I should say that my focus is 1000 years forward... except that I would like to see megafauna, and hopefully consciousness, be significantly present during whatever significant fraction of a billion years this old world has left. So I explicitly mention the number, which puts the scale of current human worries about their own affairs into some perspective.

The odds are good that the world will not be sterilized by a nearby supernova in that time, and super volcanoes, asteroids, etc are just par for the course.

The fact that evolution MIGHT once again produce complexity of the sort we see now, if starting from scratch, is no reason not to try keeping extant genetic lines around. If there is life on earth in a half-billion years, its nature will almost certainly be determined by what happens in the coming hundred years. We can't know what it will BE, but we can know that it is almost infinitely path-dependent, and will be built with what survives each bottleneck.

Asimov underappreciated chaotic systems. he allowed one major perturbation (IIRC it was maybe 40 years ago I read it), the Mule. Steering a chaotic system through a long trajectory is well nigh impossible.

The other perturbations were to be handled by the second foundation. This is explored more deeply in the non-Asimov prequel series.

I tend to re-read Foundation every 5-10 years, it's not really held up as great storytelling, but the underlying philosophy of Hari Seldon has become more resonant with each reading.

Maybe that's just me getting older, and seeing population overshoot, global warming, and peak oil as the mother of all seldon crises.

Whales are still being killed in big numbers, while the world's more "moral" nations do very little about it ... lest they upset their major trading partners ... where's the success?

I THINK you're asking me, though your response is far enough down I can't be sure.

Yes, the whales are likely screwed, by ocean acidification if nothing else.

The success is that most species still exist. Whether that winds up mattering, we can't know, but they could be in a lot worse shape than they are.

Real-world outcomes of that sort have many possibilities; and it's good to engage that reality rather than casting the world in terms of verbally-framed propositions like "whaling on/whaling off". It isn't a light switch, it's a set of interacting complex systems. Good people have given everything they have to somewhat improve whales' chances. Unless or until you're one of them, please cut them some slack.

So saying, I share your withering attitude that nations have not done, and are not doing, near enough.

There's a good documentary series, I think I heard of here at TOD.
- "The Century of the Self"
About Propaganda/PR (apparently Bernays came up with the term Public Relations as a peacetime replacement for "propaganda"). From Freud, Bernays (Freud's nephew!) and Freud's daughter(?) from war, and then into peacetime business and politics, up to Clinton...

The Century of the Self:
Part 1:
Part 2:
Part 3:
Part 4:

Propaganda doesn't work unless you have an ingorant and receptive audience.

Background repetition seems to work pretty well. System one, which is our associative emotional cognitive engine nearly assures this. Keep tweaking a meme or theme, along with another one, and the associative wiring increases the strength of the unconscious connection between them. Keep tweaking a meme/theme at nearly the same time as you hit an emotion, and the meme and emotion become connected. Then when Joe gets to the voting booth (or tries to select a product), he just "knows" that this candidate (or proposition just doesn't feel right -or vice versa). rarely can he state why, but he usually goes along with his gut feeling. These associations can being programmed all the time, by everything we experience. It takes a very deliberate effort not to be programmed as those doing the programming want. We can probably do that for a few themes, that we are on the alert about, but there are bound to be many others that slip in below our radar.

My impression is that the Russians didn't really believe their propaganda so much.

We're just better than that. That's all. We just are.

Homo sapiens saccharomyces

I tried to post the following comment on the Seeking Alpha article but it has not gone past their moderators:

He pointed out that the basic source of our economy's energy was finite, and, therefore, eventually we would run out.

That's how it works with stuff like whale oil where after the last whale has been killed and its oil consumed, there would be no more whale oil. That NOT how it works for oil, gas, coal, and metals where the easy stuff is extracted first after which progressively more difficult sources are extracted. At some point, the extraction process become so difficult (expensive) that production peaks and then declines. But there's still stuff left in the ground at the peak and throughout the decline phase. So you will never run out but this argument cannot be used to disprove peak oil, gas, coal, etc...

A couple of days ago, I wrote about the peak oil theory, arguing that we wouldn't experience an irreversible decline in oil production because of supply constraints, but would see increases in unconventional production, would transition to other alternatives, and eventually see demand decline before we literally start running out of oil to produce.

First, peak oil is not a theory that you can disprove. It's simply a logical outcome of extracting a finite resource. You can argue about the timing and production rate at the peak or the slope of the decline, but cannot disprove the concept of peak oil, coal, gas, .... Otherwise, you could have a ever increasing extraction rate of a finite resource, and you know that's not possible.

Increasing unconventional production is evidence that the production of conventional oil is becoming more difficult and will or has already peaked.

Transitioning to other alternatives is also evidence that the production of conventional oil or even unconventional oil is becoming more difficult.

Several decades later, coal production began increasing again, and it's still higher than it was back in the 1920s. So much for peak coal.

I don't follow your logic here. Are you saying that peak coal will never happen BECAUSE it hasn't happened in the past?

Peak oil isn't the notion that production will peak for any reason -- it's the notion that production will peak and irreversibly decline due to supply constraints. This is very different than peak demand -- fundamentally different

Peak oil simply means worldwide oil production peak – the reason is a separate issue. Let's see what's going on in the world of oil:
Oil is extracted at a high rate -> there's less and less easy stuff left -> new oil production comes from more difficult to extract fields -> cost of extraction goes up -> oil prices go up -> oil consumption goes down -> oil prices drop -> consumption goes up -> operators in difficult to extract areas go broke -> new production from difficult to extract area goes down -> there's less easy stuff than before the cycle started -> oil prices go up -> .....

Production cost go up because of geological constraints but consumer's ability/willingness to pay for higher prices does not increase at the same rate as production costs. Both supply and demand constraints are at play, and this is why peak oil will happen.

Frugal - Having to battle the same ole strawmen is tiresome isn't it?

"...and eventually see demand decline before we literally start running out of oil to produce."

Well, DA!. IMHO that's as good a description of the PO dynamic as I've ever heard. That's exactly what the PO dynamic (my POD, if you please) looks like: insufficient oil supplies to push prices down to the point where demand, by those who can pay the price, exceeds the max production rate. If an angel came and waved a magic wand tomorrow and dropped the price of oil to $20/bbl there would be no doubt we would suddenly be at PO. And as long as prices stayed at that level we would never produce as much as much oil ever again as we had been. We would be selling every drop we could afford to produce while, at the same time, there would be very little to no development of new reserves.

OTOH if the devil waved a magic wand and fixed the oil price at $200/bbl what would happen to the oil rate? Go up? Go down? I could drill a lot of wells if oil were $200/bbl. I mean, assuming there was someone to buy my production. OTOH if the market place were required to pay $200/bbl I might have to shut my wells in because I might not have buyers who could pay the price. And thus I and almost all other companies would stop drilling. And as long as prices stayed that high we would never produce as high a rate as we had been.

Strange isn't it: at $20/bbl and at $200/bbl we hit PO. And not only see a max oil rate but also see a very drastic decline in adding any new oil reserves. The POD has very little to do with the absolute max amount of oil that can be produced on the planet at any one time IMHO. Which is why, as I've come to understand, it matters little if PO happened in 2005 or will happen in 2025.

OTOH, there will of course always be a sufficient amount of oil to supply the market place for many decades to come. We may be producing 30% more than we are today or 50% less. Either way the market will still be well supplied. Of course, the definition of the market will be those buyers capable of paying the going rate for oil. Not once in the history of the FF age has everyone gotten all the oil they needed/wanted. They only got what they could afford to pay for. When oil hit $147/bbl a while back the market was flooded with available oil. Our production capabilities greatly exceeded demand at that time. Did it matter at all if, in fact, we had reached PO 3 years earlier in 2005? Even today at $100/bbl the market place has all the oil it needs to supply the buyers. In fact, has anyone heard of anyone unable to buy the oil they wanted? I mean those with the money and the demand? Even if global production rates drop to half of what they are today the market place (those who can afford the price of oil at that time) will be well supplied.

The POD is not the date of the max oil rate ever produced. It's not the URR of global oil reserves. It's neither ELM nor increased production from the Bakken or Tar Sands. It's not China buying foreign oil resources. It's not changing the CAFE standards. It's neither AGW nor carbon credits. It's not the meltdown of Japanese reactors. It's not LNG exports. It's not GTL or CTL. It's not unemployment due to oil price induced recessions.

It's everything on this list and much more. The POD is the elephant and we are the blind men trying to figure out just what the heck this "thing" is. Needless to say, none of us can come up with an answer based upon the individual piece of the puzzle we're holding on to. And if you don't know exactly what type of beast you're dealing with I doubt the interaction with it will be pleasant.

Strange isn't it: at $20/bbl and at $200/bbl we hit PO.

Rockman, I never thought of it that way but what you say makes sense -- $20/bbl is too low for the producers, $200/bbl is too high for the consumers.

Frugal – I just threw a couple of numbers out but we often bat the concept around on TOD. Sometimes a simple visualization helps. I’m thinking of a pendulum. But not a simple one with a constant arm length swinging in a single plane. The extreme prices of oil push the dynamics to an effective but not permanent PO. Maybe this is the source of a plateau. And like every pendulum velocity decreases towards the extremes prior to reversal. But the extremes of the amplitude are what eventually drives the forces to the other end of the spectrum. Could this produce he peak and valleys of the plateau?

But other forces besides pricing deflect the pendulum out of its simple and predictable plane. They may change the magnitude of the apex but an apex is still attained but can also change can the period by altering the path getting to it. What are these lateral forces? Guess it can be anything and everything: shale plays, Iranian embargo, the fed printing press, Chinese reserve acquisitions, US invasion of Iraq, etc, etc. Some may combine their moment and produce significant deflection . Some may combine as destructive interference and cancel out their effects.

Dang…too much time on my hands lately…thinking too much. LOL.

Sometimes a simple visualization helps.

Indeed it does! I think what you are describing with your varying pendulum analogy might be described mathematically by attractors in Chaos theory. It might be intersesting to actually see what the real world mapped out trajectory for PO looks like!

An attractor is a set towards which a variable, moving according to the dictates of a dynamical system, evolves over time. That is, points that get close enough to the attractor remain close even if slightly disturbed. The evolving variable may be represented algebraically as an n-dimensional vector. The attractor is a region in n-dimensional space. In physical systems, the n dimensions may be, for example, two or three positional coordinates for each of one or more physical entities; in economic systems, they may be separate variables such as the inflation rate and the unemployment rate.

If the evolving variable is two- or three-dimensional, the attractor of the dynamic process can be represented geometrically in two or three dimensions, (as for example in the three-dimensional case depicted above). An attractor can be a point, a finite set of points, a curve, a manifold, or even a complicated set with a fractal structure known as a strange attractor. If the variable is a scalar, the attractor is a subset of the real number line. Describing the attractors of chaotic dynamical systems has been one of the achievements of chaos theory.

A trajectory of the dynamical system in the attractor does not have to satisfy any special constraints except for remaining on the attractor. The trajectory may be periodic or chaotic. If a set of points is periodic or chaotic, but the flow in the neighbourhood is away from the set, the set is not an attractor, but instead is called a repeller (or repellor).
Source Wikipedia

FM - I was afraid someone would bring up Chaos Theory. It's taken years to get that monkey off my back. Initially I absorbed everything I could on the subject even before it became mainstream. Actually tried my hand at some crude Pointcare maps (pun intended). It's like an illegal drug but not in a good way. LOL. Life becomes one long LSD trip where you see strange attractors everywhere: stock market futures, in your coffee cup, etc. And on really bad days in your toilet.

You start to see the complexity of the world and the true meaning of butterfly effects...both heartwarming and tragic. Damn that Lorenz! It was just too much for the simple mind of a geologist to handle.

Mandelbrot - A wolf in sheep's clothing if there ever was one. Fractal this, buddy!

Mandelbrot - A wolf in sheep's clothing if there ever was one. Fractal this, buddy!

Oh yeah!


The lyrics are slightly dated since Mandelbrot has since passed away...

FM - In case you're still listening: Your link - Talk about your LSD trips. LOL. I suspect you know I wasn't knocking Chaos Theory per se. Just the opposite: it's almost too much connectivity for the human brain to take in. You can get sucked so deep into strange attractors and complex feedback loops that you may eventually come to feel there is no effective way to steer our giant ship from A to B. So many factors big, small and often unrecognized. Unintended consequences around every corner.

While it might represent a pathway to a better understanding of the human system it can also appear that there's little or no opportunity to exert true control over it. And maybe none at all.

FM - In case you're still listening: Your link - Talk about your LSD trips. LOL. I suspect you know I wasn't knocking Chaos Theory per se. Just the opposite: it's almost too much connectivity for the human brain to take in.


No, I didn't think you were knocking Chaos theory at all! Though the good thing about understanding a bit about this stuff is that it makes you appreciate how easy it is to tip a previously stable system into a totally new and unfamiliar state.



FM – “...how easy it is to tip a previously stable system into a totally new and unfamiliar state.” Or, conversely, how freaking impossible it might be to correct an unstable and self destructive system if one doesn’t clearly understand the complexity of our little bit of Chaos hell we call mankind. Seriously depressing: a world where the majority thinks the strangest attractor was Kim Kardasian and her ex-husband. LOL

The POD is the elephant and we are the blind men trying to figure out just what the heck this "thing" is. Needless to say, none of us can come up with an answer based upon the individual piece of the puzzle we're holding on to. And if you don't know exactly what type of beast you're dealing with I doubt the interaction with it will be pleasant.

I think it's worse, it's more like this Angler fish and we are attracted to and blinded by the light on it's head...


Each of these has its own special way of living in the dark.
The anglerfish has a light on its head.
When small fish swim to the light,the anglerfish open its mouth and eats them.

We never had a chance!

I think you might have to make that $300 or $400 per barrel though.

At $200/barrel, people would bitch & moan . . . but they would still buy it. They gotta get to work. They'll cut back elsewhere. And I think the growing economies could handle $200/barrel just fine.

"At $200/barrel, people would bitch & moan . . . but they would still buy it. They gotta get to work. They'll cut back elsewhere."

It's funny when this happens but you proved his point. That "cut back elsewhere" is someone doing something who will now not be doing that - and thereby not needing the energy to do it. That person will also then cut back because they don't have a job, which will impact someone else's job, etc...until some balance is reached at a lower level.

spec - A valid point. But that's why I think "dynamic" is such an important qualifier. There is no particular price for oil at which good or bad things happen. It's a continuous curve which is why I've grown fond of the pendulum image. Or even better FM's 3d representation. Some economies (or at least portions of some of them) could handle $200/bbl. But many today are struggling to handle $100/bbl. And in the late 90's there were sectors of some economies that had a problem dealing with $30/bbl. As my strange analogy highlights even low prices are difficult on certain segments. Consider the damage that current low NG prices have done to the FF sector. Ya know: it's not always just about the consumers. LOL.

But, thanks to the inevitable swing of the pendulum, current low NG will eventually have a negative impact on consumers as the burning of NG increases while at the same time its development is stifled. Yep...folks will bitch and still buy gasoline to get to work. But only those folks with jobs. The rest will buy very little. I don't recall the numbers but others have already estimated how much fuel our current unemployment population isn't burning. Good for those with a paycheck since less of it has to go to motor fuel. OTOH put many of those folks back to work, increase consumption and, all other things being equal, fuel prices increase. OTOOH that also describes a growing economy so is the increase in fuel costs a good or bad sign? I suppose that depends on where you're situated along the pendulum's path. This brings to mind a nasty image from "The Pit and the Pendulum".

A way out of that trap is to shift towards oil free transportation and other alternatives for other current oil uses.

French oil use -11.2% & Denmark down -21.2% in a decade THROUGH POLICY CHOICES !


Meanwhile we in the good ole USA subsidized oil burning by $101 billion in 2010 ($326.99/capita).


Best Hopes for Better Policies,


aLAN - "...THROUGH POLICY CHOICES!" One must assume you meant good policy choices. We are exactly where we are because of past policy choices and will remain on that path until other choices are made. Folks can go on and on about the differences between the R's and the D's. But IMHO when you look at the area of energy I see both sides continue to support the same poor policies of the past. Perhaps some variance with the rhetoric but from a practical standpoint I see little difference.

Bill Clinton raised gas taxes about a nickel.

So there is a nickel's worth of difference between the parties.


PS: I expect Obama to make a comparable move in his second term - if he has a co-operative Congress.

Alan - "...if he has a co-operative Congress." Maybe. We'll see how cooperative the D's in Congress are with him given their upcoming re-election efforts. I was just reminded yesterday that the D's had control of Congress from 2006 to 2010 with 2 years of that control with a D president. And look where our effective policies are today. One example: the president is hinting about an SPR release to lower gasoline prices so Americans can afford to burn more. I suspect it's just campaign rhetoric move and he probably won't do it. Regardless it looks like a policy position to the public and they like it.

There are precious differences between the parties, they are pathetic organizations and merely mirrors of each other, but it is still possible for the masses to push for things. And the system is not totally dead yet, it's not a binary thing. Sometimes it still functions, sort of, and it would be possible for the right people to push the right buttons and get something like a rail transportation initiative to happen. So Alan's efforts are not wasted - I think it's a great long shot, but one with a big societal benefit if it can be pulled off. This relates directly to the comments of Greenish elsewhere in this DrumBeat. It basically takes the right few people in the right places, a huge effort, and a great bit of timing and luck.

I think you are proposing a more general definition of Peak Oil. Something like...

Peak Oil is the point at which we need to make drastic changes to our lifestyles because we cannot obtain the oil we need to support our current lifestyles.

This might be because oil is too expensive or too scarce.

It also suggests that Peak Oil will come at different times for different communities.

Since there is no universal "our lifestyles" it would suggest that each individual has a different Peak Oil. It logically follows that there will not be a single date for when Peak oil happens. In fact for some it has already happened, for others it is happening now and for others it will happen in the future and for some lucky few it will never happen.

Lots of folks on this site and others talk about BAU- the question is whose BAU. Clearly different countries have different BAU and even within a single country BAU maybe very different. NYC and LA come to mind as two cities with completely different BAU.

Nigeria central bank oil output data below ministry projection


So you have State-oil firm NNPC with a figure of 2.7 mbpd and the central bank having it at 2.12 mbpd. Who do the IEA and their ilk get their figures from when compiling their records? That is quite a discrepancy.

The OPEC OMR's "secondary sources" puts Nigerian average production in the second quarter at 2.144 mb/d, only slightly above the Nigerian central bank's figures of 2.12 mb/d. The OMR also publishes a table based on direct communication. In other words what Nigeria said they produced. This table had no data for the entire second quarter but they did have figures for May. When they called them up and asked them what they produced in May they said "1.917 mb/d" or 213 thousand barrels per day less than what the OMR's secondary sources reported. That is highly unusual. Most countries give figures above what is reported from other sources.

Of course these figures are all Crude Only. The State owned oil firm NNPC may have been quoting all liquids or C+C. The EIA says Nigeria produced 2.55 mb/d C+C and also averaged that for the second quarter and almost the exact same figures for total oil. That is as if they did not produce any NGLs. I can't explain that one.

Ron P.

Thanks Ron.


Space Weather Message Code: ALTK06
Serial Number: 291
Issue Time: 2012 Sep 03 1503 UTC

ALERT: Geomagnetic K-index of 6
Threshold Reached: 2012 Sep 03 1500 UTC
Synoptic Period: 1200-1500 UTC
Active Warning: Yes
NOAA Scale: G2 - Moderate
Potential Impacts: Area of impact primarily poleward of 55 degrees Geomagnetic Latitude.
Induced Currents - Power grid fluctuations can occur. High-latitude power systems may experience voltage alarms.
Spacecraft - Satellite orientation irregularities may occur; increased drag on low Earth-orbit satellites is possible.
Radio - HF (high frequency) radio propagation can fade at higher latitudes.
Aurora - Aurora may be seen as low as New York to Wisconsin to Washington state.

This is due to the arrival; of a CME from a spectacular filament eruption a couple of days ago. If storming levels hold up aurora may be widely visible tonight. A second impact is expected on the 5th.

More info at http://www.solarham.net/

NOAA/SWPC Estimated K-index

A sudden impulse has been recorded by ACE spacecraft and confirmed by earth based magnetometers. Unclear if this is the arrival of the 2nd CME. No space warn messages issued as the impulse appears to be just below the threshold. Planetary K-Index currently 3.9 (warnings start at 4).

EDIT: Warning now issued

Space Weather Message Code: WARK04
Serial Number: 2004
Issue Time: 2012 Sep 05 0028 UTC

WARNING: Geomagnetic K-index of 4 expected
Valid From: 2012 Sep 05 0027 UTC
Valid To: 2012 Sep 05 1200 UTC
Warning Condition: Onset
Potential Impacts: Area of impact primarily poleward of 65 degrees Geomagnetic Latitude.
Induced Currents - Weak power grid fluctuations can occur.
Aurora - Aurora may be visible at high latitudes such as Canada and Alaska.

If storming increases aurora may again be visible at much lower latitudes.

Further Edit: Space weather warnings appear to being issued retroactively tonight. NOAA/USGS Boulder, Colorado is showing current K-Index of 5.5 yet that's not even warned for yet.

Anyone else hear the rumor about Naomi Klein's book The Shock Doctrine being made into a film documentary?

It' not a rumor:

Naomi Klein's controversial best-selling book which explores how both natural and man-made disasters are used to force disadvantageous political and economic changes on unwilling governments is brought to the screen in this documentary from filmmakers Michael Winterbottom and Mat Whitecross.

...The Shock Doctrine was an official selection at the 2009 Berlin International Film Festival.

In Theaters: Jan 1, 2009 Wide

On DVD: Oct 17, 2011

Sundance Selects



Your Youtube link is "blocked in your country" (which is the UK and blocked by Channel 4 due to copyright) for me. The other two links I posted work from the UK at least and hopefully elsewhere.

That's just great. The book was supposed to be a warning to the people to try and stop the process. Instead the way the process has accelerated worldwide, I think its being used as a blueprint for those who wish to apply those disadvantageous changes.

Isn't there one already ?? You can see it on YouTube.

Thanks for the replies. The reason I asked is because I caught just a few seconds of a radio interview with someone who was talking about what sounded like a new project.

Hey Earthbound

You might also want to see this..an interview with Chris Hedges

Same theme

WiseIndian ~

Thanks for the link -- I enjoyed it so much that I watched several more of his videos. Well worth the time!

Re: Experts predict lower gasoline prices... When did predictions become news (I know, a long time ago). Does any one in the MSM follow up on these predictions to score the accuracy of the "experts"? In a rational world the herds of poor predictors would loose their pundit Rolodex go-to status and be shown up as non-credible blowhards...

I don't know of any scientific study, nor have I specifically kept any record myself. However after following the gasoline market closely the last nine years, the opinion of the experts in general, would be no better than flipping a coin - except they usually get the seasonal price trends right.

Even if they do not state it, the price of US gasoline in the summer is usually higher, because the gasoline must be at a lower RVP (Reid Vapor Pressure). It is more expensive because it is harder to refine and also because it contains additives that are more costly than used the rest of the year. So it is not surprising that prices would fall as summer RVP gasoline is no longer used.

So the experts have figured out that summer gasoline is more expensive; otherwise they are quite frequently wrong. For example, even after I made a post here, right after the refinery blast in Venezuela that it would raise US prices, I saw at least three energy experts in the following days later state that it would not affect prices at all. But about a week later, most 'experts' changed their mind and said it would raise prices after all - this after prices already rose.

Speaking of gasoline price predictions, Robert Rapier, well known to TOD readers, has come out with a prediction stating gasoline prices will "fall rapidly" before the election.

Friday, the price for wholesale gasoline in NY harbor comparable to the one used in futures trading was $3.13, and the futures price for November gasoline was $2.88 (which is for delivery at the end of October). So the futures market expects a fall of 25 cents/gallon before the election.

Not sure if this contradicts the point Ronald Rapier is trying to make, but my expectation is that gasoline prices, using the November futures contract, will be higher than $2.88 by the end of October. However the prices average consumers may pay at the gas pump could well be less than they are now.

I still expect the effects of the Amuay refinery blast, and also the Richmond, Ca refinery fire, to take some more time to have their full impact on gasoline markets.

4 Reasons Why Gas Prices Are About to Fall Rapidly

While U.S. gasoline prices have been on the rise for the past two months — and are presently $0.15/gallon higher than they were a year ago — I expect that gasoline prices will start to fall rapidly in the weeks ahead.


PdVSA is set to import, however, several shipments of gasoline in the coming days totaling over 860,000 barrels, according to a company official. Additional shipments are also expected to be contracted, the official said.


It is not much of a prediction to predict that gasoline prices will fall, or even fall rapidly. Given only a random walk, there is a 50 percent chance that he will be right. What he didn't predict was fall by how much?

I am predicting that gasoline prices will indeed fall but not by very much, not more than 25 cents per gallon. I am challenging Robert to be a little more specific with his predictions.

Actually there is a little tongue in cheek here. It really doesn't matter all that much. There will be all kinds of gyrations before now and the time oil production starts to decline... forever. I may be wrong but no big deal.

Ron P.

Since the Obama administration has shown an interest in messing with your oil reserves, a drop in prices is quite likely. What will be interesting is whether doing so would have the same effect as last time.

I suspect not.

I have never bought the idea that QE is behind the rise in oil prices(if they were, what caused the 2005-2008 shock?)

QE can, however, give temporary boosts of perhaps $10-$15 dollars a barrel(probably on the lower side now since you have diminishing returns after each QE).

This has also happened with gasoline futures, who are much better near-term predictors than oil futures.

Gasoline futures are now refusing to go down, despite the fact that "everyone" said that it was because of fear of hurricane Isaac(who have now disappeared).

Gasoline is now above $3.80 according to gas buddy and there's a lot of hedge funds who are placing bets on gasoline in anticipation of a new QE from Ben Bernanke.
If there's no new QE I think we'll see a collapse in prices fairly soon.

But Bernanke is strongly hinting and if he follows through I think we'll see elevated prices for at least the whole of september. Even if they were to drop in October, the effects of heightened gas prices usually come with a lag of a few weeks since people don't really notice the effects in their pocket books after a few weeks to a month after their budget 'resets' and they notice that they have less money going to everything else and realize it's the gas.

This means that people are only now starting to feel the pain(broadly speaking, some regions have had elevated gas prices for longer) for the rise that occured in the past month.

Nonetheless, I also think gasoline prices will continue to decline by the end of this year. U.S. vehicle miles driven per capita continues to decline as the U.S. economy downsizes accordingly.

I read a new study suggesting that 60 % of all new jobs created were low-pay, despite that only 20 % of all jobs that were lost in the Great Recession were in that category.

That isn't going to create an army of new drivers, and will continue to chip away at existing ones. It's also a truly dismal sign for the future of the U.S. economy and one of the many ways high oil prices slowly destroy an economy from within, even if there's no immediate 'crash'.

Some of you may enjoy this little video animation, posted at TAE, and making it's way around the web. It's a short, watchable, and fairly concise/compact illustration of where we are, how we got here, and what we can do about it (at least the only path I could come up with). Wishing I could draw like that :-0

If we can learn anything from today's drumbeat, it's that:
1) Denialism remains high but is getting increasingly desperate. People are starting to figure out, even if they don't accept peak oil, that there's no such thing as a "recovery," and they are starting to lose faith in the political process. This is threatening to TPTB so they will ramp up the feel good propaganda.

2) The ability of the global system to respond to crises is next to nil. Libya, Greece, Syria, Spain...who is next? And from whom does the "bailout" come from? Our grandchildren?

Let's all start to accept that the post-WW2 American led consensus of global industrial capitalism creating growth forever and utopia for everyone is bankrupt at every level.

Nicely said I could not agree more. Where the next bailout comes from is a question I have been thinking about lately. Here is an interesting article in that vein.


True, but the overclass nonetheless is as ensconced as ever. Just look at the sponsored non-choices presently passing for politics. Reminds one of Jared Diamond's emphasis on hidebound but obstinate ruling elites as a core factor in eco-social disaster.

Wrong, wrong, wrong. You guys need to hang out at "Americans for Prosperity", the Heritage Foundation or the other "grass roots" Koch funded PR outlets more often. If only we give our Job Creators even more of the national wealth, great jobs will rain down on the rest of us like manna from Heaven. Tax cuts always produce more revenue than they cost the government in lost revenue, which means the ideal tax rate is exactly 0% (at least for the Job Creator class). And if we can only unburden our modern-day John Galts with such socialist evils as minimum wage, Social Security and Medicare, anti-trust laws, safety regulations, environmental regulations, federal deposit insurance, child labor laws, and consumer protections against fraud, we'll be living in a golden age of prosperiry for all. We can have Conservative Paradise here on Earth.

Shell Drill Rig Arrives In Chukchi Sea -- Historic Exploratory Drilling Could Begin This Week

After 6 years of planning, and $4.5 billion in expenditures, the Shell Drilling Rig "Noble Discoverer" is tonight (Sunday) just 10 miles from its goal.

After an 8-day-journey from Dutch Harbor, the vessel now sits in the Chukchi Sea -- and is preparing to attach itself to 8 anchors that have already been prepositioned on the sea bottom by the Shell support vessel "Nanuq".


But such an operation might be slightly complicated this week. As you might expect in the Arctic, the weather is not cooperating.

Channel 2 Meteorologist Tracy Sinclare says that 2 Low Pressure systems are starting to bear down on the Chukchi. It's possible they could produce 50 to 60 mile an hour winds -- and 10 foot seas -- through Thursday of this week. "Yeah, " Sinclare says, "It's going to be a little stormy (there) over the next few days,"

But Shell says it's prepared for such conditions.


As of Sunday night, Smith did not know if the winds and seas would prevent the hoped-for hook-up to the sea anchors on Monday. He says crews are prepared to back-off of the planned anchoring operation -- and sit things out -- if that's what's best for safety. He also says those crews are keeping an eye out for ice floes -- which were reported in the drilling area on Sunday, and which could also contribute to delays.

Shell is also planning on drilling in the Beaufort Sea. But by agreement with the N Slope Inupiat community, Shell's drilling in the Beaufort will not begin until after the bowhead whale migration and hunt. However, because of local ice conditions the drilling window in the Beaufort extends until Oct 31.

Edit: Fixed wording slightly

Don't bother with gold mining, sell shovels!

Teen opens mobile shower for grimy ND oil workers

A Tale of Two Countries: Ireland Versus Iceland

In Ruined Apartments, Symbol of Ireland’s Fall
Published: September 3, 2012

If Ireland’s rise was one of the most spectacular in Europe, its fall was one of the most precipitous, with a boom in the 1990s leading to a housing bubble in the 2000s that burst spectacularly when the banks fueling it threatened to collapse. In 2008, the government made an emergency decision to guarantee the banks’ debts, thus condemning the country to brutal austerity that has left it impoverished and weighed down by debt of its own.

A recent article in  the WSJ (behind paywall):

In European Crisis, Iceland Emerges as an Island of Recovery
Published: May 21, 2012

VESTMANNAEYJAR, Iceland—Three and a half years after Iceland collapsed in a heap, Dadi Palsson's fish-processing plant has the air of a surprising economic recovery. Mr. Palsson arrived at 4 a.m. on a recent workday. Twelve tons of cod were coming in. Soon, his workers would bone, slice and pack the fish for loading onto towering container ships headed abroad.

In 2008, Iceland was the first casualty of the financial crisis that has since primed the euro zone for another economic disaster: Greece is edging toward a cataclysmic exit from the euro, Spain is racked by a teetering banking system, and German politicians are squabbling over how to hold it all together. But Iceland is growing. Unemployment has eased. Emigration has slowed. Iceland has a significant advantage over stressed euro-zone countries—a currency that could be devalued. That has turned its trade deficit into a surplus and smoothed its recovery . . . .

Unlike Ireland, for example, Iceland let its banks fail and made foreign creditors, not Icelandic taxpayers, largely responsible for covering losses."

Interesting how the more things change the more they stay the same.

Ireland playing its usual role as a backward agrarian country of people too disorganized and inebriated to fight back against the colonizers from the east.

Iceland a harsh land of hard Nordics who come together to protect themselves when the going gets tough.

Please tell me who are these colonisers against whom we would not fight back? Im intrigued.

Judging from my last trip there, I would say BUDWEISER and MCDONALDS.. but maybe things have changed..

..but I didn't think the overall stereotyping from his comment was very helpful, mind you.. as that level of Colonization is the new East India Trading company of the Twitted Age, served up in colorful and innocuous Plastic Boxes, and I don't think there is a country in the developed West that is NOT innebriated from its Distilled Petroleum Brews.. and paying happily for the priviledge of being so modern and convenient!

Bring Back the Snakes!

Imagine that making investor pay for their bad investments. Isn't that called capitalism? It is nothing like fascism that the west practices. In fascism the workers pay for the losses of the owning class.

Fears Rising, Spaniards Pull Out Their Cash and Get Out of Spain

It is, Julio Vildosola concedes, a very big bet. After working six years as a senior executive for a multinational payroll-processing company in Barcelona, Spain, Mr. Vildosola is cutting his professional and financial ties with his troubled homeland. He has moved his family to a village near Cambridge, England, where he will take the reins at a small software company, and he has transferred his savings from Spanish banks to British banks.

“The macro situation in Spain is getting worse and worse,” Mr. Vildosola, 38, said last week just hours before boarding a plane to London with his wife and two small children. “There is just too much risk. Spain is going to be next after Greece, and I just don’t want to end up holding devalued pesetas.”

He has moved his family to a village near Cambridge, England, where he will take the reins at a small software company, and he has transferred his savings from Spanish banks to British banks.

I wonder how long before he realizes that the British economy and banking system aren't a whole heck of a lot better and that managing a software company may not be all that it's cracked up to be.

He might have been better off had he moved his family to the Spanish countryside and started a permaculture farm... and exported organic produce to the Brits.

I thinkif you factor in climate change, UK is a better long termbet than ES.

As the nuclear thread is apparently closed to new comments ( and it was getting really long) I would just add this;


$260 million Australian dollars for 131 MW, and the AP1000 goes for $7 Billion (oops, first cost overrun has already happened so 7.5 Billion USD) for 1.15 GW. Exchange rate is 1.024 AUD to USD, so I'm going to just ignore it for this approximation.

Multiply by 10, and I have 1.3 GW for $2.6 billion. At a 50% capacity factor, I can have 1.3 GW all the time for $5.2 billion. At 33% capacity factor, I can have 1.3 GW for $7.8 Billion. And the nuclear capacity factor is not 100% either. A 6-week refueling shutdown every 18 months works out to a 92% capacity factor if nothing goes wrong at all. So add another $0.6 billion to the $7 or 7.5 billion dollar cost of the plant.

The economics for nuclear are just not compelling enough to make it worth dealing with the political headaches. Which was the entire gist of the previous 500 comment thread.

It should be added that you get a productive return for every few million $ invested, with a several month delay between investment and return. If you invest in solar.

Nukes are a decade (plus) wait for the first return.

Solar has no fuel cost - and operating costs are minimal. Decommissioning costs are likely to be about zero (recycle aluminum, dispose of silicon).

Nukes do require fuel and significant personnel and material costs to operate. In the range of 2+ cents/kWh *IF* things go well.

And ask Southern California Edison (among many other nuke owners) about the reliability of the capacity factor for nukes. Nukes do go down and out for years with no warning.


Indeed, the incremental nature of solar should make it an attractive and safe investment.

I keep arguing that LCOE should not be the only metric used used to assess solar economics. PV generation is more like buying a stock that pays a 5-20% yearly dividend, depending on location and economies of scale. The value of the "stock" stays fairly constant: slow degradation of PV cells plus inverter replacement means the PV system is still worth ~70% of its initial value at year 15, assuming electricity is still priced the same, more if electricity gets more expensive. This is after a 1.5x-3x ROI. That should be extremely attractive to any investor. Better than most mutual funds and certainly better than treasury bonds. I just wish utility companies could be persuaded to see the same way. The economics work, even for rooftop solar.

You have to realize, though, that corporations are made up of the same bunch of short-term thinkers that live in most of the houses with available rooftops. Then there is the "It isn't my job" aspect, once utilities are divided from generation they have no interest or maybe even ability to get into solar.

I'd love to do solar on my house, but it isn't exactly portable. If we don't end up living here forever as we hope, then I would have to find a buyer who felt the same as I did. Not an easy task.Besides that, putting anything over four figures into a house really gives me heartburn.

Fair points. PV isn't exactly a liquid investment, nor is it mobile. But a PV system should increase the value of your house, so if you sell, you'd be able to recoup your initial investment. Any decent appraiser should be able to calculate the value-added of a rooftop system, which should more or less be pegged to the LCOE of fossil fuel generation of your local utility. Since the system would be financed with the rest of the house, a buyer would be getting a 5-10% return (more depending on your local incentives) on something they're buying at 4% interest. That's free money.

Of course, your house is only actually worth what someone is willing to pay for it. I'd imagine there'd be more interest in more progressive communities. But even (especially?) the most reactionary individuals like to make money. It's easy to calculate cash flow from PV. It's also easy to calculate principal+interest on a home loan. It then becomes an exercise of showing cash flow > increased principal + interest.

Hill. I think some of the third party owned rooftop suppliers might fit the bill. SolarCity is the only name comes to my mind, but there are others. Basically, they own the system they install on your roof, and you buy power from them, at a predetermined rate, which if it wasn't less than the utility would charge would obviously be a nogo. So a new home buyer can keep or not keep the system, the risk has been transferred to the third party system owner.

Our local city is doing a project like that. They have a big warehouse sort of building that has panels on it, and they are going to put panels on a field next to it. They run their own electric utility for the residents, so they can do things like that. They seem to be thinking ahead and encouraging a lot of conservation and renewable projects.

Where I live we have an electric co-op. They will allow solar to connect, and pay the same as they pay the coal plants per kWh, generous of them. No notions of getting into the solar business themselves, they buy their power from a different co-op, probably can't compete with their own suppliers.

I think the value of PV is really the cost of replacing the system. Since we are still climbing the learning curve, replacement cost in five to ten years is likely to be a fraction of the current cost. That's the downside of being an early adopter of the next big thing. Now with any luck, society will at least partially compensate us early adopters, by for instance locking in favorable tariffs, or Net Energy Metering, and perhaps subsidies or tax breaks.

Is it utility companies that need to see it that way. How about investors, who pool their capital and use it to construct PV farms, that sell power to the utilities. The utility gets power and a negotiated cost, and the investors get low risk dividends. Being low risk, the ROI needn't be 15% per year, as is usually implied with current LCOE calculation, but something like 5-7% ought to be very competitive with bonds.


Though this:

Now with any luck, society will at least partially compensate us early adopters, by for instance locking in favorable tariffs, or Net Energy Metering, and perhaps subsidies or tax breaks.

is already happening, though maybe not the the extent that it should. The Federal tax credit is sizable, but I'd like to see incentives from more utilities as well.

I've met a few entrepreneurs who have proposed a crowd-sourced PV farm model like you described to a utility. With all the incentives and economies of scale, the rate of return was 20+%. But you're right, most people would be fine with much less than that. In the end, the very conservative utility didn't like the idea, expressing concerns about peak load. This is in Texas, when peak load coincides well with PV generation. Frustrating to say the least.

I've met a few entrepreneurs who have proposed a crowd-sourced PV farm model like you described to a utility. With all the incentives and economies of scale, the rate of return was 20+%. But you're right, most people would be fine with much less than that. In the end, the very conservative utility didn't like the idea, expressing concerns about peak load. This is in Texas, when peak load coincides well with PV generation. Frustrating to say the least.

It's the difference between the utility company seeing its customers as a resource to be exploited (old school capitalist) versus seeing the customers as potential business partners in a mutually beneficial relationship (wacko socialist)

My own brother is part of a consortium in Germany, they rent roof space on commercial buildings, install solar panels and sell the surplus electricity back to the utility at a small profit. (Santa Claus wears a red suit he must be a communist...)

I think this is the most simple explanation for why PV is not getting built at the rate it should in the US. The utilities enjoy their monopoly and profits, which PV threatens. Utilities will put up any roadblock they can to prevent someone eating into their territory.

In my opinion, PV should be put on roofs and over parking lots and such to the extent possible and practical. One of the great advantages of PV is that it does not need to take up land. One of the complaints I've heard about solar is that it requires lots of land area - silly, but that's the propaganda for you.

In any case, unless they are forced the utilities will fight renewables all the way.

I've been youtube vids featuring the late Hermann Scheer who used to make essentially the same arguments. See the first 90 seconds or so at the following link:


or the first few minutes at the following link:


Nuff said!

Alan from the islands

To All

The criticisms of the utility companies as "fighting renewable all of the way" are probably valid for the typical utility. But be aware that there are some that are just the opposite and should be noted.

I put in a $27,000 solar PV system on my rooftop and the City of Austin Utility ponied up a $15,000 check to encourage me to do it. After my federal tax rebate my net cost was $8,900.

The internal rate of return on my investment is running about 18% (only 14 months of data so it could change a little). That is a little better and more guaranteed than a stock mutual fund.

I am putting in more panels next year.

To all above re cost of PV. Isn't the true cost of anything just everything necessary to put the planet back in equal or better condition than it was before that anything was done? That is, true cost is a thermodynamic function closely related to entropy. Seems to me this is self-evident.

So when people talk about cost, they should specify what cost they are talking about- the superficial cost, as above, that is, what numbers of dollars you have to shell out, or, far more important, the true cost- all the stuff you have to do to put things back together as they were before.

Ergo- PV is way cheaper than coal electricity.

I don't think this is any sort of obscure definition. I think lots of early humans must have defined cost that way, and tried to minimize it, else they didn't survive. Same with us.

Examples? Shucks, do I have to do all the work?

Speaking of PV cost. The following sounds to me like an interesting idea.
QBotix Brings Robots to the Solar Farm
Effectively an idea for using a track mounted robot to align an array of panels. The claim is you can have 2 axis tracking for the cost of single axis tracking for a PV farm. Two axis tracking delivers 15% more energy per KW than single axis tracking.

I'm of the opinion, that far more than better panels/inverters, what solar really needs are a lot of breakthroughs in the Balance Of System costs. This is an interesting one.

"Two axis tracking delivers 15% more energy per KW than single axis tracking."

Studies show that the gain for dual axis tracking over single axis is typically only about 3%-4%, and, in most locations/applications isn't worth the additional cost and maintenance. Homepower did a great article on the subject a while back, but, alas, I can't bring it up since they've changed their format (shame on you Homepower; that's why I let my subscription lapse).

A similar article can be found at Alternative Energy eMag.


I think we've had this discussion before. I completely agree with you, as do most people who take the time to contribute here, I'd imagine. But this is a tiny subset of the population, those who agree AND act on those beliefs.

There are probably lots of other folks who would agree, but don't do anything more than nod their heads, because it's easier that way, or certain practical matters get in the way. Most people in the world only think in terms of your definition of superficial cost, so nothing will get done until that superficial cost comes down. That's why I think the economics of solar energy are extremely important, and it's why I take no small joy in seeing solar approach parity with the superficial metric of fossil fuel LCOE.

In order to get large investment in renewable energy, enough to make a real difference, it MUST make economic sense, and it MUST be easy for the average person. The masses will not act on what they perceive as purely benevolent motives. We can sit here and complain that the general population doesn't think the way you do, but that won't accomplish much. The only people acting right now are those with the time, resources, and inclination. It takes all 3.

The masses need financial incentives. When they get enough, we'll see a tipping point. If they don't, business as usual will continue. That sucks, but that's reality. Most are motivated by money and little else.

Again, I wholeheartedly agree with you, but I don't think most people on this planet can be sufficiently motivated enough by what you describe. The early humans didn't instantly adopt a new paradigm the instant it became feasible. It took a few eccentric forward-thinkers, who planted seeds, which grew slowly until a tipping point was reached. We haven't reached that point yet. So until then, I will continue to emphasize the importance of renewable energy economics.

Pardon the anecdote, but I recently had a discussion with a coworker about PV economics. This is a person who has a soft spot for renewable energy, but won't act until he at least "breaks even" (his words). After I showed him some numbers, he told me he'd discuss with his wife getting a rooftop system, and I think he was sincere. Will he? I don't know. Maybe. But he's a lot more likely to act now that it makes financial sense.

Austin Energy has long been a major leader in conservation (negawatts) and now solar (they put in a now retired 300 kW solar plant over 25 years ago).

They are also worried about another 2011 summer making their cooling ponds too hot. Enough MW of solar and they can back their NG & coal fired plants off a tad starting in late morning till mid-afternoon, keeping the pond a bit cooler for max generation after 4 PM.

How many kW did you install ? What is your peak and minimum month kWh ?

Best Hopes for More,


How many kW did you install ?

The design guarantee from my solar integrator was for 6400W DC.

What is your peak and minimum month kWh ?

The design guarantee for AC energy delivered per month was 500 kWh for February and 760 kWh for August. But the initial data indicates I am getting much more than that in the summer months. Closer to 1200. But we have had a very bright summer (no clouds - and unfortunately little rain).

And ask Southern California Edison (among many other nuke owners) about the reliability of the capacity factor for nukes. Nukes do go down and out for years with no warning.

NB Power's Point Lepreau NGS has been out of service since March, 2008. It's retrofit is now three years behind schedule and a billion plus dollars over budget. Ratepayers will be smarting from this one for sometime to come.


Point Lepreau was the first Candu-6 reactor to enter commercial service and the first Candu-6 reactor to be refurbished. The refurbishment of other Candu-6 reactors should benefit from the experience at Point Lepreau.

As wind becomes a larger fraction of total grid capacity, at some point you have to start including the cost of whatever must be built and fueled to backup the wind turbines. Nuclear, for all its other headaches, does not have that problem.

Oh ??

VERY not true !

Today see San Onofre Nuclear #2 and #3 and Point Lepreau and every nuke in Japan (Fukushima ++). In the past dozens (almost every US nuke) has been unexpectedly down for many months to many years (Brown's Ferry #1 has the record I think, down 24 years unexpectedly).


A utility with a nuclear reactor has to make plans for it to be UNEXPECTEDLY down for several years.

Unlike good reliable solar and wind.


The capacity factor for US nuclear is above 90%, despite the occasional outage of this or that plant. Nor are the nuclear outages correlated with the night, day, or seasons across the country all at once. US wind capacity factor is around 30% and it does correlate with night, day, and the seasons.

That figure is only recently, and will drop -2% with the problems in California.

Nukes are subject to unpredictable and extended shutdowns and therefore nuclear reactors CANNOT BE RELIED ON !

For example, all US nukes had extended outages after Three Mile Island for retrofits, with (from memory) all Babcock & Wilcox reactors went down for over a year.

A comparable "common design risk" shut down all French N4 reactors, and could have shut down all GE reactors after Fukushima (or perhaps all Mark 1 GE BWRs).

All British Magnox reactors should have been permanently shut down after it was discovered that they had been built with common mild steel fasteners that corroded in use. However, the UK would have had to shut down the nation, so all Magnox reactors were derated (permanently loosing generation capacity, -24% in one example).


A prudent utility needs to keep enough capacity to replace 100% of it's nuke generation at all times. See Southern California Edison, New Brunswick Power and every Japanese utility as of today.

Experience has shown that a sudden and unexpected months to years long shutdown (over two decades for BF #1) can happen at any time to any nuke. And it can affect all nukes of the same type.

Brown's Ferry #1, #2 and #3 were all shut down together for over a decade. A *BIG* hole in TVA generation.

San Onfre #2 & #3 are both shut down for years (or permanently) after an unexpected fault was discovered last January. High capacity figures in 2011 for TVA nukes have no benefit what-so-ever for SoCal Edison and their customers. Just as good operating numbers in the 1980s for California & Az nukes did not help TVA when BF was shut down.

And what happens to US nuclear power if long term on-site storage of waste fuel is found to be too hazardous (see Fukushima) ? Logically, the reactors should be shut down till the waste is moved off-site (where it certainly should be !!!).#

Such mishaps never happen to reliable solar and wind power.

Best Hopes for Lower Risk Generation,


# There is a viable argument that recently unloaded waste fuel should be kept nearby till it cools down enough to safely move it off-site. But keeping 6 and 25 year old spent fuel rods on-site, often within 100 meters of an operating nuclear reactor, it just a hazardous practice that the industry does to save $$$.

Common sense safety practices would move as much spent fuel as feasible far enough away (say at least 25 km) so a core meltdown at the reactor will not inhibit proper care and security of the waste fuel. A serious risk shown clearly at Fukushima.

Such mishaps never happen to reliable solar and wind power.

Yes they reliably produce no output.

And they quite reliably produce power when the sun shines and the wind blows.

Their annual MWh production is typically within a 15% range.

While nuclear power plants simply cannot be relied upon (see some of the examples).

OTOH, Utilities need to be able to replace 100% of any nuclear power that they have. As the Japanese are doing.


When you say "their" production [wind] is within a 15% range, that applies to all wind turbines collectively, not individual towers. A reasonable comparison has to do the same thing with all US nuclear plants, which also in aggregate supply ~90% of capacity year round.

No, that is for an individual wind farm.

Annual wind production is + or - 2.65 Standard deviations (90% confidence interval) = about 15%.

One can count on wind & solar, nukes simply cannot be relied upon.


Annual wind production? Above you were talking about a given nuclear plant going out of service. You know the wind does not blow all the time at the same speed within 15%. Not infrequently output will drop to nothing, to less than 1% of rated power, for a day or several days at a time. Australian example, one wind farm:

You did not put ANY effort into reading what I wrote.

The annual production from a wind farm is typically within a 15% range.

Nuclear power plants and stations (multiple plants of the same type) can, and do, unexpectedly produce zero power for many months and years (and even decades) at a time.


To read is not same as to accept. I accept both facts: average annual wind farm production, and the odd long term shut down of a nuclear plant among the 104 US plants and the world's 4-500. I reject the *comparison* because they are not the same thing.

Most *all* onshore wind farms have outages for a couple days at time, dozens of times a year as the chart above shows, have regular night/day power swings of three or four to one, and many of them will have an entire seasonal month, i.e. every year, where production falls to ~10% of rated power. Then there's often a makeup windy seasonal month or two at a high fraction of rated power which yields your stable *annual* power average. Absent the backups currently in place, wind alone would leave many people and industries with out any power for many days or a month at a time, every year.

Now, I see these circumstances nonetheless as positive for clean wind power if that power is relatively inexpensive and there are other systems in place to backup up the outages. Backup appears to be relatively easy to do up to ~20% of total electric capacity supplied by wind, but beyond that it seems to me i) some of the backup power plants can no longer pay for themselves via the usual amortization as they are then intended to not operate much of the time, and/or ii) more transmission needs to be built to dilute the wind outages. The backup/transmission financing has to be assessed somewhere. If the costs are assessed to wind power, as they should be, then the original premise of inexpensive wind starts to weaken.

*ANY* nuclear power plant can go down at *ANY* time for months and years.

Therefore *ALL* nuclear power plants are inherently unreliable, and any prudent utility should have contingency plans to permanently replace 100% of their nuclear power for years at a time. See SoCal Edison, Japan and New Brunswick today.

Prudent utilities need not make comparable contingency plans for wind and solar.

There are several viable strategies to deal with the fact that extremely reliable wind and solar generation cannot be scheduled, but the total MWh/year is pretty predictable. These strategies include, but are not limited to, scheduling hydroelectric generation, scheduling NG generation, pumped storage and demand response. A matter of either using storage or scheduling to match unscheduled generation with demand.


You confuse reliable but unscheduled generation with unreliable power. Wind and solar need some back-up some of the time.

ALL nukes need 100% back-up 100% of the time - or the lights can go out.

Some contingency planning needs to be made for a low wind year when generation is 85% of a good wind year, just as utilities make contingency plans for hydro generation in a dry year. But contingency planning for 85% is much easier than contingency planning for 0%.

Nukes are simply not economic today,


ERCOT, from memory, only gives wind a firm capacity factor of 8.5%. This is despite that during the Texas blackout of 2-2-2011, wind was generating much more than that and prevented a massive and prolonged blackout during a severe cold snap when both cola and natural gas generation proved to be quite unreliable.

Unless you consider the cost of replacing N capacity lost (often for months/years/forever) due to some unforeseen problem. Think Japan/Germany (politically unacceptable after Fukishima). Or SONGS (Southern California), whose no availability has left a huge gap in its service area.

The main replacements for intermittent renewables near to mid term will be demand response, and rampable gas turbines. Storage may be important in bridging the time gap between these and potential unpredicted intermittent gaps, i.e. seconds to maybe a half hour.

That wind somehow has to bear the cost or responsibility of parallel sources is flawed logic.

Does any other power source have to be held responsible for the wind or solar when these are backing it up?

Fed Moves Toward Open-Ended Bond Purchases to Satisfy Bernanke:


Bernanke used the forum to defend unorthodox policies such as co2 injection, horizontal drilling, deep offshore exploration, in-situ oil sands development, fracking bond purchases and made the case for further action to reduce declining oil production an unemployment rate that he called a “grave concern.”

...financial EOR; scraping the bottom of economic policy.

Ah, the old Thelma and Louise motif. Sure, why not.

Rather than specify a fixed amount of bonds to purchase by a certain date, such a strategy would leave the Fed able to announce a pace of purchases that it could adjust as the economy gets closer to Bernanke’s goals.

Rather than specify a QE amount, leave it open ended? You mean Helicopter Ben will spin QE blank checks whenever and for however much they want?! I've posted several times before that how much more QEIII is than I & II would indicate the desperateness of the situation. Well, it can't get any more desperate than the sky is the limit!

Can anyone guess what happens next?

They transition the program from providing public information about QE's, their amounts and dates, to a classified, secretive program. Once that happens they quietly add over a few months several trillion to the monetary system to see if that is enough to stimulate growth and lower unemployment.

Even if the public are not informed of QE's new ongoing system, won't the dollar lose value, effectively raising commodity prices, in particular oil, and we will be right back where we started with the problem of oil priced too high for the economy to muster growth?

Ben is waiting for the elections to get over, in fact everyone is. As Jim Rogers said...the idea is to hold it with glue, gum and scotch tape till elections get over.

Is Scotch tape the same as duct tape; an essential tool for plugging round holes with square cannisters? This does seem like Command Module time coming in on low oxygen. But a different world looming up now: 'hard landing' in China?

We call it scotch tape, I think only the color is different, you have it silver colored, here it's brown/transparent.

Talking about hard landing and piling inventories in China; the other day I was watching the BBC docu on Edward Bernays, the answer to the problem of over production in early 20th century was advertisement and a culture of consumption, I wonder what's the answer now. There are only so many iPhones one can buy. Agreed that there are many people who don't even have one phone but they are obviously priced out of this economy and will remain so unless this present structure is overthrown. So in essence Market capitalism is getting strangled by it's own hands.

Deflation if that is what is happening, is a funny thing - seeming paradoxes like you suggest - i.e. self-strangling. You can't make money from business unless there are customers with enough cash. And bankruptcy takes cash out of the system because your creditors lose out. Paying workers less or sacking them to stay in business doesn't help a lot in aggregate either.


I learned recently that there is estimated 30% over-capacity in carmaking in Europe, with 0.5M jobs at risk. So it goes.

Is Scotch tape the same as duct tape

Scotch Tape

Scotch Tape is a brand name used for certain pressure sensitive tapes manufactured by 3M as part of the company's Scotch brand.

Although it is a trademarked brand name, it has sometimes been used in the United States and elsewhere as a generic term for transparent adhesive tape. The Scotch brand includes many different constructions (backings, adhesives, etc.) and colors of tape.

Duct tape

Duct tape, or duck tape, is cloth- or scrim-backed pressure sensitive tape often sealed with polyethylene. There are a variety of constructions: backings, adhesives, etc.... Duct tape is generally silver or black but also available in other colors.

In 1942 Revolite, then a division of Johnson & Johnson, originally developed an adhesive tape made from a rubber-based adhesive applied to a durable duck cloth backing. This tape resisted water and was used as sealing tape on ammunition cases during World War II.

After the war, the duck tape product was sold in hardware stores for household repairs. ... It was commonly used in construction to wrap air ducts. Following this application, the name "duct tape" came into use in the 1950s, along with tape products that were colored silvery gray like tin ductwork.

After profiting from Scotch Tape in the 1930s, 3M produced military materiel during WWII, .... In the late 1990s, 3M was running a $300 million duct tape division, the US industry leader.

If you want to know what you can use Duct Tape for, look up the Red Green Show on Google. I am sure that You Tube would have a few episodes. The man is a master of duct tape use, much the same as Rube Goldberg.


Thanks Rocky
This was the application I had in mind

Yes, I am fully familiar with many uses for duct tape, and often watch the Red Green Show for additional uses. I even taped a duct with it today, which is a highly unusual use for it most days.

For the wilderness traveler, a roll of duct tape is your first-line survival tool. I always carry one. With a roll of duct tape and a few branches, you can build yourself a survival shelter. You can repair torn clothing, fix broken boots, patch leaking boats, and build stretchers with it. Imagine how many of the early explorers might not have died out there in the wilderness if only they had duct tape.

I mostly use it for taping up old liquor boxes full of food to put on helicopters flying into remote backcountry huts. I've used up dozens of rolls that way. Saving spaceships is a more esoteric application.

Per many building codes, Use of duct tape on HVAC ducts is Forbidden.

Yes. Ironic given its name. It doesn't age well.

Here, per the Alberta building code, use of mastic, metal foil duct tape, or a manufacturers recommended sealant on joints in ducts is mandatory. Your standards apparently differ.

I suppose these would qualify for plugging round-holes with square pegs, as in the rickety economy; just to get us through US election time, as reported by Wise Indian earlier. Ben et al. are looking at hard landings, and engaged in an amazingly esoteric project if ever there was one. A lot of hi-tec complexity hanging on make-do methodology deserves a metaphor don't you think?

WI said: "Ben is waiting for the elections to get over, in fact everyone is. As Jim Rogers said...the idea is to hold it with glue, gum and scotch tape till elections get over."

Scotch tape is weaker than Duct tape.

They've already been doing that:(POMO)
print baby print
But no mention of PO on this article on'Ten major economic headwinds'holding back the economy.

I think that a lot of people have cause and effect reversed regarding the huge increase in the Federal Reserve balance sheet, versus oil prices:


I think that global crude oil prices doubled from $55 in 2005 to $111 in 2011, in order to balance a declining supply of Global Net Exports of oil (GNE) against demand, especially the increasing demand from developing countries, led by China.

I think that constrained oil supplies, and high oil prices, contributed to the increase in central bank balance sheets, as net oil importing countries tried to keep their economies going, via increased government borrowing--from both accommodative central banks and from real creditors.

While slowly increasing US crude oil production will help, it's a global market, and as the WTI crack spreads indicate, Americans are almost fully exposed to global oil prices, as Mid-continent refiners pay WTI based prices for crude oil, but charge Brent based prices for refined product, and pocket the difference as refining profits.

And in the process, Mid-continent refiners are providing a massive incentive (on the order of about $1.7 billion* per month) for Canadian producers to accelerate plans to ship their crude to their West and East Coasts.

*Canadian oil exports to US times difference between Brent and WTI crack spreads, currently about $19

Why Oil Prices are 10 Times More than in 1998 (by Kurt Cobb)

Is this one of "our" guys?

Yes. That's Kurt Cobb, of Resource Insights. Long time peak oiler. He's written a novel about peak oil.

If you mean the web site...OilPrice.com is a for-profit site that mostly re-posts articles from other sites.

Thanks, his arguments sounded familiar.

I don't have a link for this yet, but following is an interesting item from Bloomberg (Edit: Found a link).

Perhaps we could set up a debate between Ed Morse, with Citigroup, versus Heidy Rehman, with Citigroup?

In any case, I can't fault the math in the new Citigroup report. Here is a Saudi ECI Graph (Export Capacity Index, or ratio of total petroleum liquids production to liquids consumption):


I wonder if the Citigroup analyst has taken the next step and calculated post-2005 CNE (Cumulative Net Exports), assuming that Saudi Arabia were to approach zero net oil exports in the 2030 time frame?

My estimate, based on extrapolating the 2005 to 2011 rate of decline in the Saudi ECI ratio, is for post-2005 Saudi CNE of about 45 Gb, with about 17 Gb having been shipped for from 2006 to 2011 inclusive, resulting in remaining estimated post-2005 CNE of about 28 GB.

Note that the Citigroup estimate for remaining post-2005 Saudi CNE would actually be even less than my estimate of 28 Gb, since they are talking about Saudi Arabia possibly approaching zero net oil exports around 2030, versus my estimate of around 2034.

Saudi Arabia Risks Becoming Oil Importer by 2030, Citigroup Says
By Ayesha Daya and Dana El Baltaji


Sept. 4 (Bloomberg) -- Saudi Arabia, the world’s biggest crude exporter, risks becoming an oil importer in the next 20 years, according to Citigroup Inc. Oil and its derivatives are used for about half of the kingdom’s electricity production, which at peak rates is growing at about 8 percent a year, the bank said today in a an e-mailed report. A quarter of the country’s fuel production is used domestically, more per capita than other industrialized nations, as the cost is subsidized, according to the note.

“If Saudi Arabian oil consumption grows in line with peak power demand, the country could be a net oil importer by 2030,” Heidy Rehman, an analyst at the bank, wrote. The country already consumes all its natural-gas production and plans to develop nuclear power, which pose execution risk amid a lack of available experts, safety issues and cost overruns, Rehman said . . .

“As a result of its subsidies we calculate ‘lost’ oil and gas revenues to Saudi Arabia in 2011 to be over $80 billion,” Rehman wrote. “At the domestic level, we believe the only real way to rationalize energy consumption would be to reduce subsidy levels.”

The article didn't really touch on the potential for declining production in KSA. Are they/we assuming they will maintain, or expand on, current production levels/net energy?

My guess is that they simply extrapolated the rate of change in Saudi consumption relative to production, or vice-versa (P/C, what I call the ECI index).

The trend on the Saudi ECI plot is not what I would describe as subtle:

But let's be realistic . . . they will start cutting the domestic oil subsidizing within a few years. It is painful, but they'll have to do it. Iran has cut their subsidy. KSA can do a lot to keep their exporting going by cutting domestic subsidies, moving to solar for electricity, installing some nuke plants, etc. They have A LOT of fat in their system that they can cut. No reason to be giving people driving BMWs and Mercedes 50 cent per gallon gasoline.

I think it's a mistake to focus too much on the endgame, which is why I usually try to talk about countries, especially Saudi Arabia, "approaching" zero net exports.

There is another Peak Oil denying article out today, by the same "Seeking Alpha" author that posted "Peak Oil Myth: Debunking The Peak Oil Theory" on September 1. He apparently was upset by the many replies he got that he is doubling down. He starts off by quoting William Jevons.

No, Peak Oil Is Not Going To Happen

"Are we wise in allowing the commerce of this country to rise beyond the point at which we can long maintain it?"

Scary right?

Only one awkward problem: that book was written in 1865 and was about coal. It was called "The Coal Question". Doomsday energy claims aren't new. They'll probably never stop being popular.

"We're running out of [resource]" theories have been around for well over a century, and they're incredibly romantic, exciting, and dead wrong.

His theory is that because we never ran out of coal we will not run out of oil. Further down in the article he concludes:

Several decades later, coal production began increasing again, and it's still higher than it was back in the 1920s. So much for peak coal.

Reading the replies to this article was just as much fun as reading the article itself:

Most people will be totally shocked when oil reaches $40 bbl because of a oversupply glut. I believe that US can and will be energy self suffient by 2020 and be a net exporter of oil. There might be more oil in the bulken shale than in Saudi Arabia.

Ron P.

His theory is that because we never ran out of coal we will not run out of oil.

Which is exactly why England is still the coal capital of the world (sarc).

Most people will be totally shocked when oil reaches $40 bbl because of a oversupply glut.

I know the people drilling the bulken (bakken?!?) shale would be shocked at that price. They would be out of business.

Right. Oil Giants Pour Billions Into Bakken Shale

The wells here, which use the hydraulic fracturing or "hydrofracking" technology, cost about $8.5 million on average to drill and complete, with break-even pricing linked to market prices at $55 to $70 per barrel.

But this sentence preceded that one, which I find highly questionable.

A completed Bakken well, which has an average life of 29 years, generates $22 million in net profit over its lifetime, according to the North Dakota Industrial Commission's Oil and Gas Division.

I have read that Bakken wells will be stripper wells after about 6 years or so. What kind of production will they have in that last 29th year of their life?

Ron P.

Ron - Let's try a reality check. A $22 million "net profit" equates to about $31 million in cash flow when taking into account production taxes and royalties. No idea what price platform they used for oil so let's assume $90/bbl flat. That would yield a total recovery of 350,000 bo. Seems reasonable for some of the numbers folks are throwing out. If going stripper after 6 years is realistic then the last 23 years yields only about 50,000 bo. So that leaves about 300,000 bbls gross the first 6 years. Assume around 400 bopd for the average daily production for the first 12 months. That's yields about $9.4 million net income (not counting production costs). So that would produce a payout of the well cost in about 12 months. And that would be considered an excellent ROR by any operator.

Which means how much the well produces during its 29th year or its last 23 years wouldn't be a factor in the decision making process of any operator. From a Net Present Value standpoint the last 20 or so years of the wells life has no real value as far as rate of return goes. In that sense it doesn't matter if the wells produce for 8 years, 28 years or 108 years.

Now the big question: is that what the typical, or average, Bakken well will do? I don't know. But if it is then it would probably make the Bakken the most profitable oil play in the entire history of oil development in the US. I have some doubt but $90 oil does make a difference. But if oil fell to $45/bbl then the typical payout would be 24 months. Still a pretty good ROR for any operator.

So based upon $45/bbl and the numbers those folks have thrown out the Bakken would still be a very hot play. Which it might still be but I have serious doubts. Which would mean the production model those folks are tossing out may be a tad optimistic to unrealistic. But even so, the Bakken is still a very viable play especially in terms of what it means to the US oil consumers. It doesn't matter to them what the profit margins are as long as the companies keep drilling.

Of course, since the US is a net product exporter, American consumers already can't afford to buy all of the refined product turned out by US refineries (plus gross product imports).

Rockman, the economist who wrote the article apparently thinks he is exceedingly clever, that he knows something that we peak oil simpletons have not considered. He is, unfortunately, still in Peak Oil 101. Your Peak Oil Dynamic (POD) and Westexas's Export Land Model (ELM) are covered in the more advanced classes.

We shouldn't haze the underclassmen too much, though it may be tempting...

Ron - I'll take this opportunity to harp on my new born "POD"...Peak Oil Dynamic vs. plain ole PO. For those that missed this brilliant contribution of mine: it's nothing more than short hand for all the aspects of PO we've been discussing for years: oil price effects on the economies (and vice versa), military adventures in oil producing regions, environmental issues (frac or no frac), political posturing (SPR release or no release; DW drilling or no DW drilling), oil price spike induced unemployment, free fall of NG prices as a result of increased drilling as a result of higher oil prices; etc, etc.

Some have offered various other components of the POD. One reason for pushing the POD concept is to escape the constant battle over the exact timing of PO and, to a lesser extent, global URR, plateaus, plateau slopes, inter-plateau price spikes, etc. I originally tossed out the POD as a counter to what seemed like, IMHO, a relentless attack on previous erroneous (or possibly erroneous) estimates of PO timing. But it wasn't to defend those predictions but to point out that such predictions, right or wrong, aren't very critical IMHO. They may have their academic interest but otherwise whether PO happened in 2005 or will happen in 2025 it doesn't change the dynamics of what's happening in the world today.

We are where we are. The interaction between all the economic, social, technical, political, and military aspects of FF production is very complex. Much more so then the exact date of PO or if there are 500 billion bbls of oil left to produce or 10X that amount IMHO. Folks who are unemployed today in part due to however much of the economic slowdown is due to higher oil prices are still unemployed even if global PO doesn't happen for another 30 years. Likewise for the thousands of shinny aluminum boxes shipped thru Dover, as well as those in the future, it doesn't matter if global PO happened in 2005 or ever happens.

What brought this to mind was that foolish analogy about Peak Coal and the inaccuracy of the original claim. PC, whenever it did/didn't/or will happen isn't relevant. What is important is the PCD...Peak Coal Dynamic. Just as with oil, coal brought with it a host of benefits and negatives. And that balance fluctuates significantly over time. And those dynamics lasted for many, many decades. And, IMHO, appears to be on the verge of becoming even more relevant as other FF supplies are in flux.

Again, it's not that global PO timing, global URR, etc, are not factors and aren't worth discussing. But that they are just a portion of the complex system that has determined where we are today and where we are heading. The path we are on wasn't created by this factor or that one. It's a complex net work of feedback loops, technical and non-technical aspects and, unfortunately, impacted significantly by less than logical human nature. IMHO if the price of oil drops significantly (though I doubt anywhere close to $40/bbl) the POD will not allow it to stay at that level very long. Just as would occur should oil spike to $147/bbl again.

And everything I just said could have been as easily communicated by just referring to the POD. I'm beginning to see a potential spin off from the Holy Order of the Plateauite to the Orthodox Podites.

After more than 7 years now of studying peak oil and the implications of it, I understand that the world has peaked in the rate of production - roughly now. The remaining oil will be more expensive to produce, will not be extractable at the same rate, and and will likely be of lower quality. Based on some of the side paths I've followed I understand that the vast majority of people will never understand or accept it, even long after the effects get obvious (they already are).

Exactly analogous situations exist in regards to climate change, species extinction and ecosystem damage, and the economy.

So here we are, on a planet in crisis with a population that is unable and/or unwilling to see or change what they are doing and what is coming. That is our lot, and the few of us who understand must deal as bet we can. Some try to do long odds, bigger impact things (like Alan's rail efforts), some try to make local, personal efforts to increase resilience and reduce negative impact.

It simply does not matter if people believe in peak oil, it is here anyway and believing in it or not changes nothing. Same with the other issues. It might have been worthwhile to convince people of these things before they happened, even at the late hour of the LTG in the 1970's, but it's really too late now. It's time for adapting to and dealing with consequences now, and even understanding does not mean we won't be swept up in the effects.

I would guess that we've had some impact on the discourse, as there is now an almost daily flow of articles denying the possibility of peak oil, some of it bordering on hysterical. Probably next will come a grudging acceptance of it from some quarters - but too late, and that does not translate into widespread acceptance or changing of habits.

So there is no need to get all worked up about all these denial articles, it just does not matter much.

twi - I can see making the same case for CC (Climate Change) as PO. Something like CCD: Climate Change Dynamics. "It simply does not matter if people believe in peak oil, it is here anyway and believing in it or not changes nothing." Same with the CCD: how much does it matter if someone thinks the world is warming via AGW or some natural event if they don't alter their activities? Doesn't matter if they believe atmospheric CO2 will reach X ppm in 50 years or 10X that level. Are weather events becoming more common/sever? Maybe yes...may be no. But those situations still have to be anticipated and dealt with. They didn't improve the levees around New Orleans because they believed in CC. They did it because they knew how vulnerable the city was regardless of the cause.

Then consider all the other aspects of CC that aren't directly related to the weather. The political maneuvering between the developed economies and the 3rd world, the financial interests of the FF industry, the financial and personal benefits perceived by the general public from burning FF, the need of the oil exporters to maintain the their economies, the various approaches to expanding alt energy sources, the newly aggravated concerns over nuclear energy, etc.

Just as with PO there is a complex interplay of technology, economics, politics and, again just as unfortunately, the often illogical/self centered character of human nature. In one sense accurately predicting the date of PO or what CO2 levels will be in 2070 are important and unimportant at the same time. If, as I anticipate, much of the world shifts further towards coal consumption, does it really matter that much as to who has the more accurate climate model? Especially if the world is as slow to respond to CC as it has been to PO? Knowing exactly what will happen and when it will happen doesn't necessarily mean mankind will develop and implement a functional response. if life were only that simple.

Our ability to respond is limited to the physical and social structures we have now, there isn't time nor excess energy/resources/money now to create much in the way of new ones in time to have a big impact. Which is of course what Hirsch was talking about. There may be enough of a functioning governmental system to do a few limited things (again, such as rail), which would be hugely beneficial, but still will not keep this current system alive. We could certainly reduce our energy consumption and carbon emissions drastically, but I'm skeptical that our existing social and physical structures will allow that.

Worrying about whether people believe in PO is only relevant if that belief could translate into positive action, merely being right about it is of no importance. The hour is very late. If suddenly tomorrow everyone were convinced, it would still be very difficult to do something useful because of the limitations of the structures as they exist. And clearly that is not going to happen.

Project Aims to Harness the Power of Waves

PORTLAND, Ore. — About 15 years ago, this environmentally conscious state with a fir tree on its license plates began pushing the idea of making renewable energy from the ocean waves that bob and swell on the Pacific horizon. But then one of the first test-buoy generators, launched with great fanfare, promptly sank. It was not a good start.

But time and technology turned the page, and now the first commercially licensed grid-connected wave-energy device in the nation, designed by a New Jersey company, Ocean Power Technologies, is in its final weeks of testing before a planned launch in October. The federal permit for up to 10 generators came last month, enough, the company says, to power about 1,000 homes. When engineers are satisfied that everything is ready, a barge will carry the 260-ton pioneer to its anchoring spot about two and a half miles offshore near the city of Reedsport, on the central coast.


Adding to the breath-holding nature of the moment, energy experts and state officials said, is that Oregon is also in the final stages of a long-term coastal mapping and planning project that is aiming to produce, by late this year or early next, a blueprint for where wave energy could be encouraged or discouraged based on potential conflicts with fishing, crabbing and other marine uses.

Go Beavers!

I have seen plans to harness wave power, tidal power, and even underwater turbines to harness the flow of the Gulf Stream. I have not seen even one of them ever come to fruition, and I doubt seriously that I ever will. It is not that I am not for all these things, I would really like to see just one of them happen. But I seriously doubt that I will.

Roll Tide!

Well, as it says, this has gone beyond the "plans" phase, and is an actual test of the concept. Maybe it will work, maybe not. I prefer to wait and see how it plays out, and not to assume it will be a failure before it is even launched.

There are a few of these wavepower projects out there. But having watched this area for over a dozen years, progress has been painfully slow.
I think there is a French Tidal plant of a few hundred megawatt capacity -so tidal is further along.

Yes, in Brittany there is a tidal barrage which has been generating power for over 40 years, so tidal technology is already proven to work (although there are concerns about their environmental impact):

How France eclipsed the UK with Brittany tidal success story

That Rance Tidal power station is what I'd call a reliable, if not constant, power source. Still it would take ten of them to equal the average output one US nuclear reactor, and Rance is the largest such facility in the world by a long shot.

You mean the one that is suffering from sediment issues due to the obstruction of flow?


I was referring only the information provided by Wiki, the average power output of 93MWe, i.e. 240 MW peak w/ 40% capacity factor which I expect derives mainly from the daily timing of the ebb, flow, and slack tides. That, versus of the output of nuclear reactor like Palo Verde's 1.2GWe running at 90% capacity factor or 1GWe average. I have no knowledge of sediment issues at that facility.

Riiight, relying on Wikipedia and not doing any checking.


To check whether the tide goes slack every day?

UN food agencies urge action to avoid food crisis

ROME - The three U.N. food agencies urged governments Tuesday to take quick action to curb rising prices of corn, wheat and soybeans and avoid a repeat of the 2007-2008 food crises. The sharp rise in food prices in recent months threatens to make life even more difficult for tens of millions of people, particularly in poor countries, the heads of the U.N. World Food Program, Food and Agriculture Organization and International Fund for Agriculture Development warned . . .

The three agencies urged countries to avoid panic buying and refrain from imposing export restrictions when production falls, saying that while it may temporarily help consumers at home it makes life difficult for others. In the past, Russia has imposed export bans to offset low domestic wheat production.

They also said countries should adjust biofuel production requirements when food supplies become scarce. Livestock farmers in the U.S. have demanded the government relax biofuel production quotas because corn feed is becoming so expensive. Forty percent of the U.S. corn crop goes to ethanol production.

Study throws cold water on Arctic oil, gas dreams

AFP - The Arctic, often presented as the promised land by oil companies, is likely to play only a marginal role in providing for the planet's future energy needs, a Norwegian study claimed Tuesday.

The share of Arctic oil and gas in global energy production is expected to decline by 2050 because of prohibitively high production costs, according to a study conducted by the Centre for International Climate and Environmental Research in Oslo and national statistics agency Statistics Norway.

Oil production in the region is seen doubling in absolute value during the period, but will drop from 10 percent of the global total in 2010 to eight percent in 2050, the researchers said.

Recent Paper: The Role of the Arctic in Future Global Petroleum Supply


Oil production in the region is seen doubling in absolute value during the period, but will drop from 10 percent of the global total in 2010 to eight percent in 2050, the researchers said.

For that to be true, peak would have to be beyond 2050. I have my doubts...

For that to be true, worldwide oil production in 2050 would need to be over 200 mbd. I somehow doubt the researchers actually said that...

edit: I looked through the paper and they actually say that. Are there any major organizations still forecasting such oil production?

I particularly like how Alaskan production in the 2040s appears to be double its 1988 peak in the graph (good luck with that one).

South Europe cities 'face 50 days above 35 degrees'

The European Environment Agency (EEA) on Tuesday unveiled an interactive map indicating the heatwave risk for European cities six decades from now on the basis of likely global warming trends.

These regions are likely to notch up more than 50 days in the year when day temperatures will be greater than 35 degrees Celsius (95 degrees Fahrenheit) and nighttime temperatures will not dip below 20 C (68 F).

A voice not heard ...

National survey of economists uncovers vast gender gap in policy views

The study comes at a time when the national discussion, including the presidential campaign, is dominated by the economy and about which policies are best for the United States. The authors say their results highlight the importance of including economists of both genders when forming policy to ensure that a variety of professional perspectives are included.

... among the findings:

•By 20 percentage points, women economists are more likely to disagree that either the United States or the European Union has excessive government regulations. They also are 24 percentage points more likely to believe the size of the U.S. government is either "too small" or "much too small."
•Women are 41 percentage points more likely than men to favor a more progressive tax structure and 32 percentage points more likely to agree with making the U.S. income distribution more equal.
•Men support the use of vouchers in education more strongly and were more likely to support drilling in the Arctic National Wildlife Refuge.

S - As I've always suspected: women are natural born communists. LOL. Had it not been for one thing we would have drove them to extinction generations ago.

I'm given to understand that a similar proposal is also common on the other side of the isle.

Kinda gives the term "pinko" new meaning. (Sorry, ladies -- couldn't resist)

Not just for bio-diesel any more ...

China probes 'Gutter Oil in Medicine' claims

Chinese officials have told pharmaceutical firms to check their suppliers after claims that some have used "gutter oil" to make antibiotics, state-run media report.

Officials are looking into firms that reportedly use the cheaper gutter oil rather than the more expensive soy bean oil in the production process.

Gutter oil is reprocessed kitchen waste dredged from restaurant drains.

Elephants Dying in Epic Frenzy as Ivory Fuels Wars and Profits

... Africa is in the midst of an epic elephant slaughter. Conservation groups say poachers are wiping out tens of thousands of elephants a year, more than at any time in the previous two decades, with the underground ivory trade becoming increasingly militarized.

Like blood diamonds from Sierra Leone or plundered minerals from Congo, ivory, it seems, is the latest conflict resource in Africa, dragged out of remote battle zones, easily converted into cash and now fueling conflicts across the continent.

... But it is not just outlaws cashing in. Members of some of the African armies that the American government trains and supports with millions of taxpayer dollars — like the Ugandan military, the Congolese Army and newly independent South Sudan’s military — have been implicated in poaching elephants and dealing in ivory.

The vast majority of the illegal ivory — experts say as much as 70 percent — is flowing to China, and though the Chinese have coveted ivory for centuries, never before have so many of them been able to afford it. China’s economic boom has created a vast middle class, pushing the price of ivory to a stratospheric $1,000 per pound on the streets of Beijing.

It's a nasty mechanism for total extinction of a species.

If an animal is just hunted, say, for meat like baleen whales, it is possible at least in theory that "commercial extinction" - the inability to find enough of them to make it worthwhile to put to sea - will provide a way that a few may survive.

However, this can be overwhelmed if a product is popular enough to cause irrational prices to be paid; witness the bluefin tuna selling for a half-million dollars per fish in Japan. With this sort of bounty on its head, the fish will not have much chance. Yet there is at least SOME vested interest, in theory, in not killing them all off.

But even more powerful is when the species produces something of durable/storable resale value like ivory, or mythic utility, like rhino horn, tiger bone, etc. In that case, those who buy and store the supply are saving a commodity that will become almost priceless once the species goes extinct. It is in their INTEREST for it to become extinct. Indeed, those who already sit on - say - an ivory supply have a vested interest in seeing elephants exterminated ASAP on general principles, even if they don't buy any more.

It is pretty sobering to see a live tiger auctioned off and then cut to bits on the spot once the spot market has gotten the high bids for its blood, ears, teeth, eyeballs, bones, etc. The critter is skeletonized by a crowd with knives, just like walking a cow into a pond of starved piranha. I have photos, you wouldn't want to see 'em. Of course, there is no pharmacological value to tiger bones, but human belief - that old standby - comes through.

And it ain't only tigers, rhino's, elephants... ANY species which gets rare enough gets a "buzz" going in the "chinese medicine" trade. It's powerful; even undercover agents I've sent into China have wound up believing it because the power of belief around them is so strong.

There is a lively trade throughout the world in making animals extinct and storing their mummified remains to sell in small bits to rich chumps.

There's nothing for it but economic collapse, and the large uncommon species will all be gone within a human lifetime unless they are actively relocated and protected. Not likely, and seldom practical.

Interesting insight Greenish ...

... Ivory may become the new 'Dragon's teeth'

Except for the horrible and immoral consequence of extinction that hunting rhinos and elephant for horn and tusk, we mine gold for similar reasons. We dig gold out of a hole in the ground and store it in a vault, which is just another, albeit seemingly secure, "hole in the ground". Gold is expensive because most of it is uselessly buried away, providing no benefit to mankind. And at the present price of gold there is not much useful that it is used for.

Gold mining is a messy business.

We are an irrational animal.

Edit: added a thought.

U.S. Shale Glut Means Gas Shortage for Mexican Industry: Energy

The bottleneck in Latin America’s second-largest economy is the latest energy whiplash stemming from the U.S. shale gas boom. Mexican gas prices are tied to rates in its northern neighbor, where soaring supplies from shale fields drove gas to a 10-year low and reduced Mexico’s wholesale price 32 percent in the past year. Manufacturers can’t get enough of the energy.

... nations like Mexico that link prices to the U.S. Henry Hub benchmark are seeing rapid demand growth compared with Europe, where most rates are tied to oil.

“The problem is about pricing, not about reserves, not even about pipelines,” David Shields, a Mexico City-based independent energy analyst and publisher of Energia magazine, said in an Aug. 22 interview. “Companies want the same prices here than those in the U.S. when the supply reality is different in Mexico.”

Mexican companies are moving away from fuel oil, which trades at $17.476 per million of British thermal unit, to use natural gas, which sold at $2.834 per million Btu ...

Oil price report prompts speculation

A prediction that the price of oil could rise 50 percent this decade as global demand exceeds supply left no shortage of opinions from people with professional interest in the matter.

A Barclays research report issued last week asserted that oil produced from shale and other formations won’t be sufficient to meet growing global demand as production from older fields declines.

Barclays forecast that the shortfall could push prices for Brent crude, the global benchmark, to $125 a barrel sometime next year and possibly to $180 by 2020.

Barclays said production is declining each year by close to 4 million barrels per day, while annual global daily demand is rising by more than 1 million barrels, even in the weak economic environment. It added that political tensions in the Middle East could disrupt supplies further, worsening the shortfall in the coming years.

Art Berman, a Sugar Land geologist and energy consultant who has long voiced skepticism about the long-term prospects for the much-touted shale boom, shares Barclays’ view on global demand.

A zombie oil spill!

PHOTOS: Oil washing up on the Gulf Coast after Hurricane Isaac

Oil is washing up along the Gulf Coast in the wake of Hurricane Isaac, confirming concerns that the storm could churn up oil in the Gulf of Mexico. A Greenpeace research team took samples from beaches along the Alabama coast on September 2, including from an area with hundreds of tar balls in the Bon Secour National Wildlife Refuge.

From the U.S. Coast Guard...

Oiled wildlife discovered as pollution assessment teams survey Isaac’s damage

Hat Tip: Climate Progress


"As panel prices have dropped from approximately $3/Watt in 2009 to less than $1/Watt in 2012, the share of balance of systems (cabling, wiring, racking and mounting) among total system costs has increased."


"By eliminating the aluminum frame, approximately $25 per panel or $0.10/Watt is saved. Without the frame, no grounding wire is needed ($0.015/Watt). Further cost savings on clips, nuts and bolts are realized by integrating the panels into the mounting structure ($0.04/Watt)."

So the PV cells are getting so cheap that the frames are getting to be a larger share of the bill, so their costs are getting a hard look too. The frame really didn't matter when it was 1/30th of the panel cost, but at 1/9th, oh yes, we care deeply.

I wonder how low the cost of PV has to get to compare with wind, when you add in the higher maintenance cost of the turbines. On that subject, one of my business contacts does metallurgical failure analysis, The wind turbines have definitely increased his business. And probably will keep doing so for a few years while they shake the bugs out of the designs as they are applied to the local wind patterns.

Realistically What Might the Future Climate Look Like?

Robert Watson, former Chair of the Intergovernmental Panel on Climate Change (IPCC), recently made headlines by declaring that it is unlikely we will be able to limit global warming to the 2°C 'danger limit'. This past April, the International Energy Agency similarly warned that we are rapidly running out of time to avoid blowing past 2°C global warming compared to late 19th Century temperatures. The reason for their pessimism is illustrated in the 'ski slopes' graphic, which depicts how steep emissions cuts will have to be in order to give ourselves a good chance to stay below the 2°C target, given different peak emissions dates (Figure 1).

Figure 1: Three scenarios, each of which would limit the total global emission of carbon dioxide from fossil-fuel burning and industrial processes to 750 billion tonnes over the period 2010–2050. Source: German Advisory Council on Global Change, WBGU (2009)

Image caption from the original source document (PDF):
Figure 3.2-1
Examples of global emission pathways for the period 2010–2050 with global CO2 emissions capped at 750 Gt during this period. At this level, there is a 67 % probability of achieving compliance with the 2 °C guard rail (Chapter 5). The figure shows variants of a global emissions trend with different peak years: 2011 (green), 2015 (blue) and 2020 (red). In order to achieve compliance with these curves, annual reduction rates of 3.7 % (green), 5.3 % (blue) or 9.0 % (red) would be required in the early 2030s (relative to 2008).

No room for complacency.

Iron ore at weakest since 2009, Shanghai steel at record low


"'Shanghai rebar is falling like there's no tomorrow,' said
an iron ore trader in Shanghai." The decline in iron ore has been pretty stunning. Things must be really starting to bomb in China, I would have thought that oil product and iron ore would track each other closer than they are doing, but oil is holding very steady and ignoring the plunge in iron ore.

Volt monthly sales to hit record in August

The Volt has been the biggest selling plug-in car. That said . . . even the Volt's sales have been a bit disappointing. However, the Volt has shown us how the electrification of the the automobile will proceed . . . through evolution. Pure EVs are a bridge too far for now. But PHEVs have proven interesting to a decent number of consumers. The Volt is a bit expensive though. But . . . new PHEV models are coming out that are cheaper. The Ford C-Max Energi. The Plug-In Prius. The upcoming Accord plug-in. It looks like electrification is going to happen in baby steps.

So be it. I hope the PHEVs have a decent electric range though. The Volt's near 40 miles is great. The C-Max's 20 miles is decent. The plug-in Prius' ~12 is a disappointment. But even 15 miles or so on electric power every day can help a lot. 15 miles saved on each weekday commute is near 4000 miles. Plug in at work (with a standard 120V outlet) and save another 15 on the way home and that could be 8000 miles saved a year! Those kind of numbers in a lot of new cars could have a huge impact on oil consumption over time.