DrumBeat: October 31, 2006

[Update by Leanan on 10/31/06 at 9:14 AM EDT]

Global oil output ‘will start to decline by 2015’

Global oil liquids output will hit a plateau in the next five to 10 years and then permanently decline, whilst global gas production will keep on rising through to 2020 and beyond, an international oil expert says.

Even with high oil prices, offshore exploratory drilling in South East Asia, where the majority of exploration expenditure is directed, is not increasing substantially, according Michael R Smith, head of the global oil and gas forecasting company Energyfiles.

China cut off exports of oil to North Korea

BEIJING - China cut off oil exports to North Korea in September, amid heightened tensions over that country's nuclear and missile programs, Chinese trade statistics show.

Energy boom to cool: experts

Energy companies are churning out big profits, but there are signs that firms are growing more cautious as costs rise and prices drop for oil and natural gas.

Grain Drain: Get Ready for Peak Grain

Unless this year’s harvest is unexpectedly different from six out of the last seven years, the world’s ever-decreasing number of farmers do not produce enough staple grains to feed the world’s ever-increasing number of people. That’s been a crisis of quiet desperation over the past decade for the 15,000 people who die each day from hunger-related causes. It’s about to cause a problem for people who assumed that the sheer unavailability of food basics, usually seen as a problem of dire poverty, would never cause a problem for them.

Warned of costs, world seeks way to fight warming

OSLO (Reuters) - U.N. climate talks in Kenya next week will hunt for new ways to fight global warming, stung by a warning that long-term inaction may trigger a cataclysmic economic downturn.

But delegates say the 189-nation talks from November 6-17 look unlikely to make any big breakthroughs and may shy away from setting a firm timetable for working out a successor to the U.N.'s Kyoto Protocol, the U.N. plan for curbing global warming which runs out in 2012.

OPEC says British climate change report "unfounded"

A hard-hitting report on climate change published by the British government on Monday has no basis in science or economics, OPEC's Secretary-General Mohammed Barkindo said on Tuesday.

Oil firms drill for deepwater profits

With global demand for oil showing no sign of abating, the industry is going to ever greater lengths to secure supplies.

U.N. chief asks new uses for atom energy

UNITED NATIONS - U.N. nuclear chief Mohamed ElBaradei urged the world's nations Monday to adopt a broad new plan for the use of atomic energy to address mounting concerns about the further spread of sensitive technology.

He said a new approach is essential because rising global demand for energy has made atomic power a more attractive option and proliferation threats remain a serious challenge, including North Korea's recent test, Iran's uranium enrichment program, and nuclear trafficking.

Kuwait: We want our piece of the oil pie

At yesterday's opening session of Kuwait's second legislative session of the eleventh Parliament, about 50 citizens rallied in silent protest in front of Parliament requesting a bailout of citizens' financial debts. The group calling itself, "Al Takafal Al Ishtemai" were draped in black scarves and adorned with black badges saying "Yes to the waiver of loans".

Researcher urges shift to solar power, carbon trading

India: Energy map reveals rising dependency on coking coal

A new National Energy Map for India, prepared by the Energy and Resources Institute, along with the office of the principal scientific advisor, has predicted that in a high growth scenario, import dependency for coking coal will increase to 85% in 2031. The figure amounts to 2,475 million tonnes of coal imports, creating the need for securing supplies. Import dependency, in fact, will be across all the energy sectors, be it crude oil, coal or even nuclear, but as R Chidambaram, principal scientific advisor to the Union government, puts it, “In the short term, we need the world, but in the long term, the world will need us (for nuclear technology).”

Uganda: Sorting Out the Power Problem

Loadshedding has become a way of life in Uganda. And even when the power is available, its cost is ever rising.

Power cuts have become more frequent because of drastically rising demand. This demand is an indicator of growth, but also of poor planning.

NZ clean and green - or poor

Dire forecasts about the impact of climate change could trigger a new round of trade protectionism based on environmental barriers and tariffs – damaging this country's ability to sell goods to lucrative markets.

A key risk was consumers opting to buy local products in an effort to cut carbon emissions from transporting goods, known as "food miles".

U.S. drops royalty claims against Chevron

The U.S. Interior Department has dropped claims that the Chevron Corp. underpaid the government for natural gas produced in the Gulf of Mexico, the New York Times reported on Tuesday.

The decision could have far-reaching impacts, allowing energy companies to avoid paying hundreds of millions of dollars in royalties, the Times reported.

‘Switch to Renewable Power Before You’re Forced to’

The world is slowly but steadily shifting from fossil fuels toward renewable energies. It is unavoidable for related industries to fit themselves into the wind of change or otherwise fade away, said Lee Hyun-seung, chief of GE Energy Korea.

Investigators: BP ‘knew of safety problems’

HOUSTON - BP's global management was aware of "significant safety problems" at the Texas City refinery and 34 other locations around the world well before last year's deadly explosion at the U.S. plant, investigators said on Monday.

[Update by Leanan on 10/31/06 at 8:33 AM EDT]

BOSTON WORLD OIL CONFERENCE: ASPO-USA positions itself to be a big player

● The Doomed “Plan B”

● Extensive Matt Simmons’ Transcripts

● Conference Highlights

● Protest – Energy Equity

● Challenging Renewable Dogma

How about a question (moved at that)?

Would biomass gassification of bovine manure potentially be more economically efficient and environmentally sustainable than anaerobic fermentation in those digesters?

RE: Cellulosic Ethanol vs. Biomass Gasification
Posted by Robert Rapier on Thursday October 26, 2006 at 9:20 AM EST

I see your bovine and raise you a food.
Its daily consumption is just 1kg of feedstock (such as waste flour, leftover food, spoilt grain, spoilt milk, over-ripe fruit, green leaves and oil cakes) as opposed to the 40kg of cow dung needed for the traditional plants. From this small amount of feedstock it produces 500 litres of gas.
(now, have better web sluths than I come up with a 'how to make this' instructions?)

These people make a claim
This book describes how we can totally stop Global Warming with its resultant cancerous climate change and restore atmospheric greenhouse gas levels to near pre-industrial level. It shows how this can be done quickly and at negligible costs.

A good way to get killed.

Finally, some battery news (hype?)

Drilling away :-)

Appropriate Rural Technology Institute (ARTI)

Commercialisation of Improved Biomass Fuels and Cooking Devices in India: Scale Up PROJECT

ARTI Biogas Plant: A compact digester for producing biogas from food waste

Compact Biogas Plant - details

The battery claims from altair nanotechnology are very exciting, if true.

Why is it that, decade after decade, we are constantly tantalized with wonderful new technologies that are never heard from again? (we have a built in conspiracy generator; TPTB are constantly buying these wonder patents up and destroying them!!!!! DEATH TO TPTB!!!!        

because the "technologies" are either fabrications or they can't be sold at a profit.

There seems to be a lot of companies out there working on new battery tech. I'm sure someone's product will be more than snake oil and end up having a combination of good power density and life expectancy to really drive electric cars as an option.

Very intriguing. If indeed it is able to process generic biomass waste, including plant waste like switch grass etc, some advantages are immediately obvious:

(1) Only C & H (as CH4 or others) are burned and released to the atmosphere. I know that in tradional (cow-manure) biogas plants solid residue is returned to the fields as fertilizer. Looks like this is possible here also. This means that
  (a) No atmospheric pollution
  (b) minized depletion of soil nutrients

(2) non-grain waste from food crops for e.g. could be used as feed-stock. Right now if plant waste is returned directly to the soil the microbes that break it up release energy directly to the enviroment, without sending it through a cooking stove first :-)

(3)) Compress the bio-gas and use it in a vehicle. In India, many cars have been modified to run on LPG (cooking gas - the stuff used on gas grills in the States) because of a lower cost/Joule.

(4) Generate electricity in a thermal cycle or directly a Fuel Cell.

The options also appear sustainable.

May come to pass as fossil fuels are taxed or run out.

odds are there is more in the mix than simple C and H.  Sulfur and poss. nitrogen gas.  Not a big issue for a cooking flame, but a real show-stopper for an ICE.
The second item of your list sounds to good to be truth. A closer look at chapter 11 - ENERGY SYSTEMS WE USE NOW AND WHAT WE MUST USE TOMORROW  shows the neglect of the thermodynamic laws and economic principles. Also not one word is mentioned on EROI issues or growth figures to implement those future renewable energy systems.

"Ethanol can replace petrol in motor vehicles
and that would end the production of greenhouse
gasses from all the cars in the world. We must
make it happen now. Ethanol is actually a cheaper
fuel when oil prices go over $45.00 a barrel.
Virtually all motor vehicles other than those
in Brazil, today run on either petrol, diesel or
LPG (liquefied petroleum gas). And they are all
fossil fuels. To stop Global Warming these fuels
have to be replaced. What is amazing is just how
incredible easy and practical it is to do so.

"Now in Brazil, and in any other efficient sugar
producing country, from a hectare of sugar cane
they can produce 5,500 litres of ethanol per year,
that's 35 barrels of motor fuel. On a per acre basis,
that's 14 barrels or 600 US gallons.
The total world's oil consumption is four billion
tons per year. That's two thirds of a ton of oil per
head of population. It is the equivalent of one car
for every four and a half people on the planet.
There is actually only about half that number of
transport vehicles in the world. The rest of the oil
is used for heating, petrochemical production etc.
What does this all mean? As an exercise, let's
say we drive 16,000 miles per year and get 20
miles to the US gallons, (26,000 kilometres at 12
litres per 100 k). That's about three tons of fuel
per year. Then to grow the ethanol or biodiesel
we would need to allocate two thirds of a hectare,
that's under one and a half acres per motor vehicle
That's 0.13 ha or 0.33 acres per person. That
would require an area of sugar cane farms 2,750
kilometres square or 1,700 miles square. That's
about the size of the Amazon basin and we will
have cancelled our need for petroleum derived
transport fuel."

I'm a bit more interesed in the claim

Allan calculates that a 1.6% increase of organic matter levels on the world's arable lands (8.5% of the land area) would stabilise atmospheric carbon levels.

I call BS on the 1kg making 500 liters of gas.  1 mol gas = 22.4 liters right?  even if you had a kg of H2 you would only have 11.2 liters gas.  So no chemical process can turn 1 kg into 500 liters gas sorry it does not make sense.
As you 'call bullshit', please feel free to conact these people

And tell them they need to retract their researched award because you believe it is 'bullshit'.

It has to be a typo or not enough info.  The article says 1kg daily makes 500 liters but does not say per day per month etc.  So fermentation breaks stuff down.  No additions from air like carbon to CO2.  Now there is no way 1kg of any material can become 500 liters at STP.  High school chem.

So I restate my BS with the caveat of maybe they left out per month after 500 liters or something similar.  I am interested to see the device though I would build one for 500 liters per KG just so I could break laws of physics and chemistry in my own home.

It is a typo, see here http://www.arti-india.org/content/view/45/52/. That says 500g per 2kg.

Unfortunately pretty much every press release turns useful information into gibberish, so I prefer to get the source.

Don't get me wrong I compost my organic waste...if I could capture BTU's on the way to fertilizer I would but I think household size fermenters are not feasible.  Think about it could you cook your food on your previous scraps?  You need more external inputs...yard debri manure etc.
Notice in the press release that the testimonials have people saying things like, "I get all my neighbors to give me their scraps."  Suggesting that one family's waste is not enough.  
Again I think conceptually it is great if we all managed all our waste streams 100% the world would be better off. My point is if someone tells you they can make straw into gold guard your 1st born child.  If you are producing that much ort maybe you need to plan your meals better.
That sounds about right Leanan (unless your family owns a cow or several smaller critters maybe - pool your poop?).  This is a few years old but makes an interesting point about how practical digesters would be if the corn-stover and wood-pelleters Fuel-Twitch to "Home Grown" biogas all at once:

"37. Digesters can be built in virtually any size, from a small family-sized digester (1-2 m3) producing just enough gas for cooking and lighting to a large community-sized of thousands of m3 producing sufficient gas to generate electricity.  

The technical viability of biogas technology has been repeatedly proven in many field tests and demonstration projects, but numerous problems arose as soon as mass dissemination was attempted, particularly with regard to availability of digester feedstock (animal manure and water), as well as the high investment cost (US$300-500 for 1-2 m3) ". oc+household+africa+size+fermenters+natural+gas+fertilizer&hl=en&gl=us&ct=clnk&cd=6

eric blair here's the problem I have with that biogas thingie. Supposedly all these nice Indian folk are coming up with all kinds of waste food to put into it and make it run?

Well, look, I was a kid in the 1970s. I know how much waste food comes from a poor household, and the answer is: Damn near None. I mean, we threw Nothing away! Spoiled milk? It never got a chance to spoil! Same for all the other food goodies, you gotta be kidding me, we threw like NOTHING out, and we still weren't as poor as these Indians. The idea that Indians, or us in a few decades, are going to have enough to throw away as presetn-day middle-class Americans is just silly. Look up the occasional pieces written by people who've gone to live in India or come from India to here - nothing is wasted there and present-day Americans' waste is obscene.

That article sounds like a come-on for investment someone's set up, kinda like the "free energy for life" hoax that's gone around the US, you send 'em a buncha money and they sell you their free-energy device and the "rights" to install 'em around your 'hood....

That article sounds like a come-on for investment someone's set up, kinda like the "free energy for life" hoax that's gone around the US, you send 'em a buncha money and they sell you their free-energy device and the "rights" to install 'em around your 'hood....

If I went to their office for r 100 ruppies I could get a CD.  For 200 ruppies, they'd mail me the CD.  

Rather cheap...and if I can use the 800 lbs of organic waste stream (used brewing grain) I already have.....

As I said in a post yesterday (with recommended links to Sweden, Iowa, and Vietnam), sustainable natural gas should be part of our renewable energy solutions going forward and are just as free as wind and solar. Another beauty of using human or animal manure methane is that it can be added directly to the natural gas grid infrastructure already in place and it doesn't contain the toxins found in garbage dump biogas.  Sweden is perhaps in the lead using such technology.  They also use compressed biogas to run taxis and buses.  Pig manure produces more methane than bovine manure and the process eliminates the disgusting hog manure odor as well.  Electricity is being generated at a number of rural sights using these biogases.  This should be part of small, local energy solutions, such as the Vietnamese farmers who having been cooking with pig manure methane for decades.  Of course, there is a limited amount of manure to be used, as compared to huge amounts of plant material fermentation potential.  And, I'm not advocating these large hog and cattle operations which make these systems possible.  
Here in NC, the energy from the farm question has been elevated.  With all these hog and turkey farms concentrated in the eastern part of the state(NC is no 2 in both hog and turkey production), there is some work being done to see how we convert from the way we have been doing things to something that's a lot more holistic.  
Starship Trooper -

I have some familiarity with the environmental problems created by the concentration of poultry and hog operations in North Carolina and elsewhere  (such as Delaware, where there is a huge concentration of poultry farms downstate).

It is a perfect example of some of the harmful displacements caused by large-scale factory farming. Massive amounts of grains are imported from other regions to feed the animals, but the waste from those animals remains within the region. While this waste is rich in nitrogen and phosphorus, its quantity is so large that it is often more than the local farmers can comfortably handle. Hence, it is often applied to the land in excess amounts and results in groundwater and surface water contamination. (I understand that eastern North Carolina is particularly vulnerable in this regard as it has very sandy, highly permeable soil.)

And it has been generally uneconomical to transport feedlot wastes long distances to the point of origin where the grains were originally grown. However, there has been some success in drying and pelletizing poultry wastes and thereby extending the economical distribution radius.

I really see no way out of this problem other than to go back to a more diversified, more balanced, and less concentrated form or agriculture.

The reason they(Murphy Farms et al choose Eastern NC was because the folks there were poor and could not fight them.

The Neuse river was devastated. I lived there for some years and it was downright dreadful and ignorant what they did to that area. It didn't get near Wake County, the richest in NC and where I lived because no one would have stood for it.

Right now they are searching for more land to spoil. They are unrelenting. All this so one man raising 50,000 pigs can get rich while 50,000 people have to live in the stench.

Finally as I heard later the outcry became too much and laws were passed. Thats why they are looking for new areas to infect. Scumbag cheesedicks they are , one and all.

Just read your ARTI site above--very interesting.  A quote:

This fact is seen in the current practice of using low calorie inputs like cattle dung, distillery effluent, municipal solid waste or sewerage, in biogas plants, which makes methane generation highly inefficient. To rectify this skewed approach, in around 2003, Dr. Anand Karve (President of ARTI) developed a compact biogas system that uses starchy or sugary feedstock. Just 2 kg of such feedstock produces about 500 g of methane, and the reaction is completed with 24 hours. The conventional biogas systems, using cattle dung, sewerage, etc. use about 40 kg feedstock to produce the same quantity of methane, and require about 40 days to complete the reaction. Thus, from the point of view of conversion of feedstock into methane, the system developed by Dr. Anand Karve is 20 times as efficient as the conventional system, and from the point of view of reaction time, it is 40 times as efficient. Thus, overall, the new system is 800 times as efficient as the conventional biogas system.

Don't mix your input/output mass efficiency and your time efficiency.
The problem with gasification of manure is that it is so wet. You are going to consume a lot of energy getting water out. Furthermore, since the fermentation product is easy to remove methane as opposed to water soluble ethanol, it probably makes more sense in this case to do the fermentation.

If the manure is already dried (sun-dried, preferably) then it may be better to gasify it. The conversion would certainly be higher than in a fermentation.


I'm not sure I could give you a definite YES-or-NO answer, but here are some considerations that I think are important.

First off, cattle feedlot waste is wet, quite a bit wetter than the fresh-from-the-cow manure. The main reason is that water is used as a transport medium to move the manure from the stalls to a collection basin. The waste also contains large amounts of urine. While feedlot waste is far more concentrated than domestic sewage, it is still wet.

To gasify organic matter you have to heat it up to the point where pyrolysis reactions take place. If a lot of water is present, you are going to expend a great deal of energy in boiling off the water. If a feedlot were to set up a more dry system of waste collection, then that would lessen this problem.

Second, one must keep in mind that the orginal primary purpose of the anaerobic digestion of feedlot waste was not to produce gas but rather to render a highly noxious and odoriferous material less so and thereby make it more suitable for land disposal. The production of digester gas has generally been a secondary benefit.

Also, in the anaerobic digestion process, not all of the biodegrable organic matter is converted into methane. Some of it (typically 1/3) is oxidized into CO2. So, a portion of the potential energy content of the waste is lost to CO2.

Another consideration is that for an anaerobic digester to function at a sufficiently high rate it needs to be maintained at a certain temperature (85 to 105 degrees F if operating in the 'mesophilic' range, or 120 to 140 degrees F if operating in the 'thermophilic' range.) As such, in many applications some of the digester gas is used for heating the digester itself and is therefore unavailable for other uses.  

So, it would appear to me that if (and it's a big IF) you could get the bovine manure to the gasifier in a fairly dry  (or at least not too wet, state), then the gasifier might be more efficient in producing combustible gas. If not, then the digester would probably win out. Where that moisture content breakpoint is, I haven't a clue.

I suppose you could insert a drying step ahead of the gasifier, but that itself would consume energy, in addition to being a tremendous potential odor problem.

While I haven't really answered your question, I hope this at least adds some perspective to the question.

Interesting stuff joule.

Smithfield Foods in the US has set up a bio-energy subsidiary that is capturing methane gas from hog manure and producing methanol down in Utah.

Probably the largest operation of its kind, they're now looking to expand the facility however one of the key issues is getting consistancy.

Smaller units are found in Microgy's biz model here: http://www.environmentalpower.com/companies/microgy/ which may have been posted already.

Both entities are looking at converting their respective processes into EtOH paths.

Another good George Monbiot Article:
Drastic action on climate change is needed now - and here's the plan
The principal costs of climate change will be measured in lives, not pounds. As Stern reminded us yesterday, there would be a moral imperative to seek to prevent mass death even if the economic case did not stack up.
In contrast to the question, maybe I can add something useful- the website of the full Stern Report:

Stern Review on the Economics of Climate Change

Final Report -
Video of Matthew Simmons at ASPO USA Peak Oil conference at Boston University, Oct 27: ASPO USA Peak Oil conference at Boston University, Oct 27

Bill Moore of EVWorld writes:

Interestingly, among the speakers, the only one to suggest that we might already be at the point of peak oil was Matthew Simmons, who suggested that if we see another six to ten months of gradually falling production, it will signal that we've passed peak.
"Data always beats theories"
Then he proceeds to "prove" his theory by cherry-picking data.

He proceeds to lay out a large number of sub-theories, with no data.

This is an excellent speech. I will be parsing it and rewatching it multiple times. But where's the data?

The data's bad? So why do you use it to make your points, Mr. Simmons?

Don't get me wrong, your speech and your work raises excellent points. I just have no opinion yet. I'll be spending 50-70 hours this week, as I do every week, looking at the data. Like CERA, like Rembrandt.

How about this data, from EIA:
(Westtexas often pointed to 12/05 as the peak, but I pointed out to him that no month will ever be looked at as a peak even in hindsight, and nor will it be a 13-month avg; it will be a peak year. So, whether 7/05 stands or is revised, the interesting comparison at this point in time is 06 vs. 05.)

  1. The first 7 months of 06, compared with the first 7 months of 05; 06 down 180k/d world, down 300k/d opec, (therefore up 120k/d non-opec). (BTW, US down 400k/d, or 5%, and before alaska began leaking.)

  2. Speculation: opec will keep to its promises and cut 1.2mmb/d starting tomorrow, or an avg of 200k/d for the year, or 480k/d avg over the last 5 months.

2a. If opec does not cut, for 06 to exceed 05 the last 5 months will have to avg over 84.5mmb/d; over the last 12 months of available date, only 2 months managed such a high output.

2b. If opec does cut, production will have to avg 85mmb/d over the last 5 months to exceed 05, and only 1 month, the 'subject to revision' 7/06, has ever managed this.

We are all aware, as Freddy is wont to point out, that many diligent workers have concluded that a peak in 2010 looks likely, and some of these think 2012 or later. It is worth pointing out that none of these pundits have predicted less output in 06 than 05, which I think is likely even if opec does not cut and nearly certain if it does.

Many countries, not least sa/mexico, are showing lower output this year in the face of record prices - with the former clearly trying hard based on the 2.5x increased rig count -, so it is possible that even as substantial fields are placed into service we are seeing accelerating declines from the far larger number of mature fields. imo, mature regions are declining at a rate of at least 5%, the US rate, and as time goes on we will see this rate go ever higher as a higher proportion of the world's production is off shore and/or has been produced with horizontal wells, the latter a newer, 'high tech' practice as the oil approaches the gas cap, a la ghawar/cantarell.

The best point westtexas ever made was that professional oil men were universally surprised, even shocked, when texas was unable to increase production when all restrictions were lifted.  Many will be surprised, even shocked, when peak becomes accepted, regardless of when it happens.

The early names are deffeyes, simmons and bakhtiari. We'll see just have to wait and see who gets the gold ring.

Thanks for the analyses, well done.     I miss Westexas being  thoughtful and not afraid to be out front of everyone with his analyses.
His brief remarks on Saudi production, while including some excellent warnings about data, are basically meaningless as long as they avoid serious analysis and discussion of the actual facts. Such analysis, of course, proves him wrong.
Could you specify what facts you have about Saudi Arabia that prove Simmons wrong? I find "facts" about Saudi Arabia very elusive other than hard production data (still inexact) and their increasing investments into their fields.
Right on Peakearl. I would like to see those facts myself. But don't hold your breathe for Oil CEO to produce them. While Simmons' book "Twilight in the Desert" is just crammed with facts and data about Saudi Arabia, I have not iota of data come from Oil CEO. He just takes jabs without producing any facts whatsoever.

Ron Patterson

Yes, crammed with data that is based off of reserve figures calculated in the 1950's and 60's.  I for one am simply SHOCKED, yes SHOCKED, that they managed to pin their numbers so exactly back then!
You know damn well what the facts are Ron. They are the numbers that are published every month regarding how much oil comes out of the ground. Whether or not they are correct is another issue. I never said I had any other information that Simmons does not.

My question is where is all this data that he alludes to being in possession of that the rest of us don't have.

There is no evidence that Saudi Arabia's production at 9.3 million barrels a day is that way because of geological/peak-oil reasons. But there is substantial evidence that it is voluntary or geo-politically driven.

Now, I'm not saying this is the case, or that we will look back and it will be the case - but the best data we have currently suggests it is.

But, again, you only see what you want to. Go on pretending that you know more about everything than everybody else here and that you study the numbers more than anybody else and blah, blah, blah.

He busts into peak-gas at the end.Just in time to not adaquately discuss the issue. Where did the Amaranth trader get his ideas, Mr. Simmons?

December 2005. (With caveat, since it is obviously wrong).

How much data can you give in a 28 minute sppech? Well, I listened to the speech and thought it was full of facts and data. However if you would just take the time to read his book "Twilight in the Desert" you would find it full of data, cover to cover.

Also check this link for hundreds of points of data.

Ron Patterson

I've read Twilight three times. Once before I had even heard of TOD. I'm quite aware of what it contains and what it doesn't.
Another note from Bill Moore:

I had the chance to speak at some length with Matt and a colleague of his from Norway. Simmons offered an interesting explanation on why gasoline prices have plummeted in America over the last few weeks. I, like many others, have assumed it was just a political ploy by the Bush Administration to curry favor with an increasingly disenchanted electorate.

Simmons sees it differently. He says what happen is that analysts misread several inventory reports that appeared to suggest that the US was awash in gasoline. As a result, so prices dropped. But from his perspective - and he says he spends 50-70 hours a week reading energy data - the analyst mistook a transition in types of gasoline - what he called woolens and cotton - at the seasonal fuel change as excess inventory. Apparently there are huge stockpiles of MTBE-enhanced fuels that are soon to be made illegal that are sitting on storage. These combined with a steady new stream of non-MTBE fuels makes it appear that we have more gasoline on hand than we actually do.

This combined with Goldman Sachs decision in August to dump its gasoline price index spooked other traders who didn't want to be left holding the "bag." They too sold and the price of gasoline dropped like a rock in just a few weeks time.

Simmons lamented that this kind of pricing volatility masks the real oil supply and demand problem. He said people are now starting to buy SUVs again. Toyota's Bill Reinert also commented on this shift in buyer preferences during his presentation by noting, "Sheep are meant to be shorn."

Interesting stuff.  Thanks for posting it.
Apparently there are huge stockpiles of MTBE-enhanced fuels that are soon to be made illegal that are sitting on storage.

I don't think that's accurate. Part of my job involves gasoline blending and scheduling. Gasoline doesn't sit around for long. There was ample warning of the MTBE transition. The conversion to ethanol did lead to a gas shortage in the Spring, which was part of what drove prices higher then. But I am personally unaware of any MTBE-blended gasoline setting around anywhere, unless it is in people's personal gasoline stocks.

Dear Mr Rapier,

I'm still confused by EIA's statistics. The finished gasoline stock figures are quite low and would indicate an imminent shortage if imports of finished gasoline aren't going higher. The other component of the total gasoline stock are termed "blending components" and seem to be only that since we can't use ethanol now directly but only very diluted with conventional gasoline. So how do you interpret this discrepancy between finished gasoline decreasing and blending components increasing ?

I will give a detailed answer a bit later. I took the day off today (I still have 5 weeks of vacation to burn this year!) and my youngest wants to go play in the snow.
Thanks in advance. Have fun ! (so the "heat" wave is over in Scotland ?).
Actually, I am still in Montana. Won't leave for Scotland until the end of January.

Which stocks are you looking at? When I looked at the inventories, it looked like gasoline had been pulled down, but was still well above the average level for this time of year. It looked like blend stocks have remained in a fairly narrow range.

Here is what I told Nate Hagens, who asked me about this a few days ago. I don't really discern in my mind between blend stocks and finished gasoline. If the demand is there, I can turn blend stocks into finished gasoline very quickly. The reason that blend stocks start to build, is that demand has slowed and the pipelines and terminals start to back up. If the trend continues, and the inventory pull on gasoline continues to be large, you will see blend stocks get pulled down pretty quickly.

You will also see blend stocks get pulled down during fall and spring turnarounds. Most refineries will try to build stocks going into a turnaround, and draw them down while the refinery is down.

There is also some end of the year inventory management that may effect blend stocks. Year end inventories are taxed based on certain criteria, and most refineries try to end the year with low inventories of various components.

Ok, thank you very much.

I look at EIA's data on gasoline stocks in their weekly summary tables or in the specific stock files in weekly or monthly data. Total gasoline stock is broken down into finished gasoline and blending components. Finished gasoline is well below the average and indeed blending components are well above average. Most of the increase in these blending components comes from ethanol. I will try to show this with a graph Friday if I have the time, otherwise in two weeks. But I didn't know that one can easily convert ethanol or other blending components into gasoline and of course this makes the stock situation much better.

It isn't as easy for ethanol. That is the one exception to the blending component rule. If the pipeline is backed up, and you can't get to the terminal where ethanol is blended in, then you would have a case where you have a component but no easy way to get it in. But for the other blending components, I can blend them as fast as the pipeline can send them out.

I would like to see your graph. I was looking today, and nothing seemed out of the ordinary to me. Maybe I was looking at a 4 week running average, which would explain why things weren't changing all that much.

Please, if anyone can clarify:

  1.  What in the supply chain does the finished products (gasoline, diesel, etc.) storage inventory include?  Tanks at the refinery?  Pipeline terminals?  Tankers & barges?  Petroleum jobbers?  Local gas stations?  All of the above?

  2.  Did the shift from MTBE to ethanol affect the way gasoline inventories are calculated, since ethanol is typically not blended in before the pipeline terminal?  If yes, are the inventory numbers now comparable to those previous to the switch?

  1. Not sure about everything. Definitely the refinery tanks and pipeline terminals. But I would suspect that the EIA defines this somewhere.

  2. Since the terminal numbers are reported, I don't believe there would be any impact. The ethanol at the terminal would be counted.
Possibly, as a suggestion, it is more in the stocks of MTBE which may be flushed, so to speak, in terms of gasoline in various areas - for example, the military and its various stocks come to mind.

A vaguely similar situation happened with CFCs in the mid-80s - legally banned, but still worth a fair amount when sold. And there was more hanging around than people had at first assumed. (But I am assuming that a recycling market, as occurred with CFCs, is not in the offing.)

Just pure speculation, but I am not sure that anyone has a complete overview of what fuel is sitting in what storage facilities (for example, how much gasoline does the Navy store for Marine units?). And to a certain extent, if you did know and tell, you (or the person who told you) would be likely breaking laws which are now being more actively enforced than in the past.

for example, the military and its various stocks come to mind.

And this may very well be true. But the gasoline business is pretty open (trades go on constantly) and I would stunned if there is any commercial gasoline setting around in a tank with MTBE in it. That would have been a monumentally bad decision.

Demand did not "accelerate" as prices rose. Just the opposite. Data please, Mr. Simmons?
Do you mean his comments at about 15:00?

I transcribed this bit as best I could.

This wouldn't have been so bad if demand had been modes. But demand has soared over the last 15 years. These numbers come out of the BP energy statistics book which is the best data on natural gas and on the IEA's on oil. Its just interesting to see that in an era when most people were worried that demand wasn't going to grow our global oil growth was 16 million barrels a day between 1990 and 2005. And had the FSU not fallen by 5 mbpd the growth would have been 21mbpd.

Prices rose between 1990 and 2005. And demand rose as well.
Seems pretty solid to me.

In further review He actually uses the word "accelerate" about 21:00.

Its [demand] growth actually accelerated as prices grew

But again it seems to me he covered it pretty well at about the 15:00 point.
Prices rose between 1990 and 2005. And demand rose as well.

Production has been rising since the beginning of time. Prices have gone up an down. We're looking for a definitive correlation over a defined span of time. If you want to use 1990 that's fine. But what about other time periods? Do they not count, or are we only going to use ones that prove his statement. Both more recently and historically we can see where rising price chokes off demand and production(or where it surely looks that way). And remember the key word here is "accelerate." I'm seeing the opposite from about 2003 to the present. I'm seeing a deceleration.
In the current edition of Global Business on BBC World Service, Peter Day interviews Clark Gellings, Head of Innovation at EPRI (Electrical Power Research Institute). Many topics covered, maybe not much new for TODders as far as facts go but definitely an interesting insight into the thinking at that institution. A streamed version of the interview is available at the Global Business site.
US Rail Movements

Someone at the ASPO conference claimed (in private conversation) that 90% of US rail ton-miles were coal and that the rails were saturated (true for Wyoming but not the US).

I found this statistic.

Commodities. In 2004, the major rail-carried commodities (in terms of tonmiles) included coal (40 percent), intermodal traffic (trailers and containers on flat cars) (16 percent), farm products (predominantly grain and soybeans)(9 percent), and chemical products (9 percent). The fastest growing segment of rail traffic has been intermodal traffic, with the number of trailers and containers increasing substantially from an average of 3.4 million loadings in the early 1980's, when doublestack container trains were introduced, to 11.0 million in 2004. The highest traffic corridor for intermodal traffic is between California and Illinois reflecting the land portion of container shipments between the U.S. an


Two recent stories on rail from the ag press - Top Producer:

Rush Hour on the Rails
Top Producer, September 2006, By Marcia Zarley Taylor

Let's Fix Rail Gridlock
Top Producer, October 2006, By Kendell W. Keith, president of the National Grain and Feed Association

 Have you been working on Simmons?  


Transcript of Q&A, Matt Simmons in Crystal City, June 20, 2006
When asked what actions should be taken immediately to mitigate Peak, Simmons had three of the most valid suggestions I have ever heard that can be implemented over the next five years:

"My three favorites are easy to do, and we don't need any new technology. I'm sure there are some better suggestions but they are not easy. The first thing I would do is go on a program over a 5-year period of time for zero tolerance of using large trucks to ship goods over roads long distances. Just stop. To the extent that you need to ship goods long distances, put them on rails-to-water. Use the water system to take goods coming from China that come to San Diego, all the way through the Panama Canal, up the water system to Portland, Maine. You can basically move that transport in a shorter period of time - ironically - than using trucks and with 1/35 the amount of oil. So anytime you get a 35 times improvement, that's a big deal."


This is lacking the costs associated to such moves.  While it makes sense from a purely oil standpoint, we once again must look at the value derived from burning the oil in a truck.  If costs are lower sending stuff from CA to MA, then that's the way any prudent business would operate.  If it's more cost effective to cart it straight from China through the Canal, and up to MA, it would be done.  It's as simple as that.  How are you going to get anything in MA, if companies don't make wise business decisions.
I agree 100%.

Imagine the enormity of the investment and economic upheaval it would take to convert 100% of "long distance" truck freight to rail or barge.  Yikes!  I have a great deal of respect for Simmons, but there are times when I wonder what the heck he's smoking.

Ya, but both your comments disregard the fact the trucks use oil, that is priced without any externalities, as in receiving gluttonous subsidies from production to roadbuilding. Boost the oil price by 500% and see how crazy he is.

I think Simmons is smart enough to see that realistic pricing would need to be applied before realistic comparisons can be made.

Lucky for all of us, that will be soon.

Agreed.  As we've discussed before, the problem is the free market doesn't encourage taking a long view. I think Simmons is worried that by the time the price signal is strong enough, costs will be so high that we cannot build the new infrastructure we need.    

I'm talking about the rails to water mostly.  Now think this all the way through.  I won't disagree with you're assesment that oil is subsidized yada yada yada.  However think all the way through on this junk from China staying on the water through to Maine.  The ENTIRE, ok main, reason containerized shipping has worked so well is that you've got mutual needs.  What in the hell leaves Maine and goes to China?  Now what leaves the port of San Diego to China?

Now I don't know the numbers, but it FAR more wasteful to have a ship stopping at ports all over the country, rather than a centralized port of entry where rails can distribute the goods.  Also Simmons is quoted as saying trucks vs water is a 35X improvement.  My point about all this not working wasn't even talking about the trucks, but rather this idea to send ships all over the country to makes tops that are unnecessary.

I'm sure we could take this all over the place, but I'm just not sure even if diesel was $8/gal, we are going to be sending stuff from China to MA or anywhere else besides the ports of LA.

Just let the hidden hand do it... scarce oil will bring high prices will bring more water and less truck transport... which will bring the truckers to strike, block roads, etc, just like in france. There will be no political will to bring this anguish forward.

Decent MSM piece on what the projections for global warming can be.  It's got an interactive timeline going back to the year 200 projected through 2100 and interestingly they provide sources and methods.

Very interesting story. I think the Stern Report underestimates the impact Global Heating will have on the economy. They should go further (but likely can't, politically) to say that global heating of this magnitude will have the following environmental consequences: oceans rising, cities flooding, stronger and more disruptive storms, reduced agrcultural yield, etc. This then will paint a clear picture of our ability to continue the maintenance of our economies.

The Stern Report says our economy could suffer a 5% hit due to global climate change, but let's consider how much of a hit our economy will take when London, New York, Hong Kong, Shanghai, Dubai, and dozens of other financial centers are either underwater or terminally damaged by storms. Add to that a starving population. Looks to me like the economy could be the least of our worries.

Tom A-B

I often think what would happen if WS was suddenly under water, lots of it at that.  How many burroughs survive sea rises or a better question might be this.  Since it will take time for the sea levels to rise, does WS spend boatloads of money to stay, or do they spend boatloads to relocate?  I highly doubt the latter will be chosen.
That's why the Stern report is yet another obsolete piece of dribble. Money talks, and for many people it's the only language they understand. But that doesn't mean that it can tell you anything real about either peak oil or climate change. These reports build the illusion that it can.

As Monbiot says: the costs will be measured in lives, not pounds. The value of lives can't be caught in economic terms, other than grossly distorted ones (when you die, lost economic productivity is measured, but that means nothing to those who mourn). A very limited language that should not be used beyond its limited scope, but thinks it can capture all.

It's the same as Al Gore, who blabs about the money that can be made in green products. A very basic failure to understand issues, but inevitable if you only speak that one language. It makes him useless as a voice.

If Stern would have found that it's cheaper to let it go than to act, what would have been his conclusion?

Our entire economic system, like the money that propels it, is a fictional tale. And when New York and London are underwater, and hundreds of millions of people are on the move, that system will not exist anymore.

The reality that it fails to describe will.

China turns to salt water to ease drought

Mon Oct 30, 10:44 PM ET


< A short article with an interesting note about where the energy will come from to desalinate. Pasted in below... >

BEIJING (Reuters) - Drought-stricken China, where hundreds of millions of people are without regular access to drinking water, is turning to desalinated sea water to help end the crisis, the government said on Tuesday.

Apart from widespread drought, factories have ignored pollution hazards and dumped toxic industrial waste into rivers and lakes in China, home to one-fifth of the world's population but only 7 percent of its water resources.

"China is expected to desalinate 800,000 to 1 million cubic meters of sea water per day and use 55 billion cubic meters annually by 2010," the State Development and Reform Commission said, detailing China's ninth five-year plan.

China desalinated 120,000 cubic meters of sea water per day last year.

It was not immediately clear how China, which is also desperately short of fuel, would power the energy-hungry desalination plants.

More than 600 medium- and large-sized cities in China were now suffering "serious water shortages," Water Resources Minister Wang Shucheng said this month.

China is investing billions in a project to transfer water from its lush south to the arid north.

The so-called western route of the project could involve harnessing rivers cascading from the Tibetan highlands in the Himalayas to quench the thirst of Qinghai province and other poor western areas.

But Wang said the proposed system of tunnels stretching 300 km (190 miles), and costing more than the $25 billion Three Gorges Dam hydroelectric mega-project, was unnecessary, unscientific and not feasible.

China should look into solar thermal for desalination. According to the insolation maps, Beijing gets as much sun as Texas.

In their paper Solar Thermal Energy: The Forgotten Energy Source, Reuel Shinnar and Francesco Citro report that solar thermal desalination is not only feasible, it is the cheapest method available. They write that "A 1 GW solar-based power plant (6500 hours/year) would produce about 150 million m3 water/year, or 45000 acre-feet of water." By my calculation, using the SEGS system in the Mohave desert as a reference, a 3300-acre solar thermal installation will generate 1 GW.

Or they could do it with the waste heat of large nuclear plants for even less.

Solar is great and has a future. Nuclear is necissary today. The only present alternative to nuclear is coal.

Try reading Shinnar and Citro's report -- they come to a somewhat different conclusion.
I had to scrounge for it, but they note that concentrating solar isn't competitive with nuclear for baseload electricity, and they make these strange handwaving cost estimates for distribution. The best locations for concentrating solar will require large distribution infrastructure.

The cost estimates for nuclear are also overstated from current nuclear power costs today by over 30%.

I'm sure concentrating thermal has a place, but they vastly overstate its capacity and competiveness in the short run.

I am willing to be persuaded if you can provide some citations, facts, etc. to back up your assertion.
Nuclear is necissary today. The only present alternative to nuclear is coal.

When your model is some large government protected monopoly will deliver the power and you send them a check...then yes.

Its too bad that people still see themselves shackeled by the government protected monopoly model.

Too much money, eh? Luckily for those who worry about this, our present fiat system is ideally set for a big wipe-out of all the excess through a major crash.

And afterwards, it'll feel like all that cash never really existed. That's because it never did. But you and I will still be stuck with the bills. They do exist. It's a bit like being stuck in an absurd theatre play.

When central bankers start talking about too much money, be afraid.

Central banks facing effects of money glut

Markets around the world are awash in excess cash, fueling a frenzy of investment from London to Tokyo that could lead central banks to push interest rates higher than investors are anticipating.

Money remains cheaper than it was in the 1990s, even after every major central bank raised rates this year, the first simultaneous tightening since 2000. The cash glut is reheating the British housing market. In Japan, companies plan the most investment since 1990. China's biggest bank this month attracted orders for more than half a trillion dollars with its initial public offering of shares.

"Interest rates in the main economies have still not been raised enough," said Tim Congdon, visiting fellow at the London School of Economics and one of the "wise men" who advised the British Treasury in the 1990s. "There is a buoyancy in asset prices one gets with high-risk monetary growth."

Without further tightening, central bankers may have new asset bubbles and inflation risks on their hands. The European Central Bank, whose officials voice the most concern, is convening a conference in Frankfurt next week on the role of money growth in guiding interest rate policy. Among participants: Ben Bernanke, chairman of the U.S. Federal Reserve; Zhou Xiaochuan, governor of the People's Bank of China; and Kazumasa Iwata, deputy governor of the Bank of Japan.

"When monetary growth is strong, the housing markets are very dynamic and the stock markets are vigorous, the probability of an inflationary episode within three or four years is very strong," said José Manuel González- Páramo of the ECB executive board.

The ECB, unlike other central banks, explicitly uses money supply to gauge inflation. Growth of M3, the bank's preferred measure for the 12 countries sharing the euro, unexpectedly accelerated to 8.5 percent in September, close to a three-year high. That added to pressure on the bank to add to its five rate increases since early December.

"It's a bit ironic, given that they are the ones who pay most attention" to money supply, said Thomas Mayer, chief European economist at Deutsche Bank in London.

Is this Marx's 'crisis of capitalism'?  He predicted that capitalism would be so successful that the excess capital would destroy it!  Just a thought.
Marx predicted a lot of things that did not come true, even though 'the great experiment' was tried in may places and with many versions. All failed in every way... some like cuba, with universal health care; universally no medicines or even needles, and even doctors are only available with special 'fees', except of course for the bearded one and other party hierarchy, along with the usual sapping of all human initiative.
The Persian Gulf Excercises are now named "Leading Edge"...

Gulf military exercise rattles Iran


TEHRAN, Oct. 31 (UPI) -- Warships from six nations will participate in the two-day Exercise Leading Edge maneuvers in the Persian Gulf, drawing swift condemnation from Iran.

Newstalk ZB reported Oct. 28 that New Zealand will be involved in the operation, which U.S. officials say is intended to train participants in halting ships carrying nuclear materials. A U.S. Coast Guard cutter is the sole American ship among the nine vessels taking part in Leading Edge

Exercise Leading Edge is occurring as major powers consider possible United Nations sanctions against Iran over its nuclear program.

Bahrain, will participate in an exercise for the first time under a three-year-old non-proliferation security initiative.

Ministry of Foreign Affairs spokesman Brad Tattersfield said that while New Zealand will be contributing and exchanging data with participants, no New Zealand ships are participating in the exercise.

Iran News reported Oct. 29 that Iranian Foreign Ministry spokesman Mohammad Ali Hosseini told reporters in Tehran: "We are watching their movements, very carefully. We do not consider this exercise appropriate. U.S. moves go in the direction of more adventurism, not of stability and security. Countries of the region can provide security better than any other party."

Why is this not newsworthy in the US Mainstream Press?

I would think the fact that Iran is rattled would make headline news.

Instead, we get this headline:

North Korea to rejoin 6-nation nuclear talks:  Bush hails deal, thanks Beijing; discussions could begin in next few months


This makes me wonder what affect the stories released by news editors have on the public right before a political election.

The message this relays to casual readers is that worldwide tensions are relaxing and all is well.

Do you believe this?


Iran's Revolutionary Guards to hold new round of war-games


Tehran, Iran, Oct. 31 - Iran announced on Tuesday that its Islamic Revolutionary Guards Corps (IRGC) would soon hold a new round of war-games.

The IRGC drills have been code-named "Great Prophet 2", according to a statement issued by the elite military force and carried by state-run news agencies.

IRGC Supreme Commander Major General Yahya Rahim Safavi is expected to give further details on the purpose of the military exercises and their locations in the coming days.

The announcement came as United States-led forces were carrying out naval war-games in the Persian Gulf in what analysts have said are meant to serve as a warning to Tehran.

Twenty five nations, including Britain, France, Italy, and Bahrain, have taken part in the naval exercises as part of the U.S. Proliferation Security Initiative (PSI). The goal of the exercises is to practice blocking transports of weapons of mass destruction.

In April, the IRGC conducted naval war-games, dubbed "Great Prophet", in the Persian Gulf and Sea of Oman. During the exercises, Iran put on display what it claimed were new stealth missiles, sonar-evading torpedoes, and even a "flying boat".

Iran has a dual military system with a regular Armed Forces as well as the IRGC. Both have their own Army, Navy, and Air Force and report directly to Supreme Leader Ayatollah Ali Khamenei.

With three US carrier battle groups in the area, and with both the US and Iran conducting war games in and around the Gulf, we have a perfect stage setting for some sort of 'incident' that will provide the pretext for the US and/or Israel to launch a massive air attack on Iran.

Some supposedly knowledgeable people have speculated that something might pop before the end of the year.

While there is no doubt that the US could inflict massive damage on Iran, the big unknown is what happens in the Middle East after the air attack is over.

Respected military analyst, William S. Lind, in a recent article raised concerns over the possibility of the US forces in Iraq being vulnerable to encirclement by having their supply lines from Kuwait cut by massive attacks by shiite militias aided by Iranian irregulars. He felt that air power might not be all that effective in preventing it. While it sounds a bit far-fetched to me,  he has predicted things very accurately in the past (such as the mess that Iraq has become), so I don't totally dismiss that possibility.

Then again, maybe this is all a big game of high-stakes bluffing. Time will tell.  

I'm thinking it is a way to stalemate Iran/North Korea for the time being...kind of like saying "You'd better not try anything right now or we will be there right in your face."
Since we mastered the brinkmanship of nuclear war, I think this might be some of the same, hopefully.
WAG:  If the Republicans landslide lose the coming election, the trigger will be pulled.  Otherwise, they'll wait until a more opportune time.
Regarding Michael Kane's ASPO-Boston report, how sad to hear of Mike Ruppert's health problems.  I'm sure I join many here in wishing him a speedy and full recovery.  That's quite a list of problems he has, though, very disturbing.  He's one of the good humans.
Kudos also for using the Citgo sign so nicely.  Not sure if it has been mentioned here, but there was a brief movement to have it torn down after Hugo's lively UN presentation.  Some local politico getting his name in the paper.  Seems to have died down, fortunately.  Sometimes a short attention span is a good thing...
Several of Mike Ruppert's health problems might have been longstanding.  I suspect he has just received his first complete physical examination in a very long time.  Having said that, I am dismayed that he is unwell and wish him a speedy and complete recovery.
hear of Mike Ruppert's health problems.  

Any links to this?  (and how long till the shadowy government forces are blamed)

The story is posted in the members area of the FTW website, where it can be easily read by the 30,000 subscribers who value Michael Ruppert and wish him well.
where it can be easily read by the 30,000 subscribers who value Michael Ruppert and wish him well.

Right.  Becasue anyone who hasn't bothered to spend money with him think he's some kind of bastard who has no value, and everyone who's paid money find everything he has to say a polished diamond, and even the NSA/CIA/Pentagon agents who have a subscription are well wishers.

Now that we have sorted all that out, perhaps someone can post a link for the uncaring bastards who wish him ill?

The link I posted up top describes Ruppert's health problems. (The FTW description of the ASPO conference in Boston.) No subscription necessary. And yes, it's kinda sorta implied that someone poisoned him or something.
Thanks for pointing out where more details can be found.

If he is being poisoned/attacked with electronic ranged weapons/space based lasers/whatever method you want to list....why would fleeing America to 'keep them from killing him' would suddenly stop the efforts of people who want to kill him?

Once he has died (now or from old age-natural causes) he'll be the topic of 'he was assassinated' talk for years.  

This reminds me of websites that pop up on accident that are obituaries to the deceased, but they didnt die yet.  I remember a Senator from somewhere in the southeast that this happened to.  He did die some time later I believe.
Best news I've heard in a long time:  NASA just announced a mission in 2008 to service the Hubble Space Telescope one last time.  Hurray!  As a lifelong astronomy afficianado I couldn't be more pleased, or surprised!  I think this is likely a clear example of the possibilities when the public bombards our gov't with a demand, there has been a huge movement to force this mission to take place.  Congrats to all involved.
Regardless of how things turn out on our little spaceship we call Earth, the rest of the universe goes on.  I've always liked that fact.  Remember, when the lights go out, we'll all be able to see the stars, and there won't be much else to do anyway after dark.  I recommend getting a telescope and some paper star charts before TSHTF, of course.  A Dobsonian-type would be best, or at least something not requiring electricity.  It's very humbling to peer at a faint smudge of light and realize that it's a galaxy that contains over 100 million stars.
...and every second each of these stars emits more energy than we have used in our whole history. If we indeed end up in the dark ages because of lack of energy, then we have to be very stupid creatures after all.
This is an excerpt from an article by AM Best (behind a paywall) regarding new insurance products for a low-carbon world. These include:

  1. A discount for insurance on hybrid electric cars.

  2. Coverages aimed at green buildings, because they are "better risks".

  3. Coverages relating to carbon cap trading.

  4. Coverages guaranteeing that an energy efficient building will actually produce the savings claimed (not yet available).

Experts Forecast More Insurance Products for Green, Low-Carbon Economy

Even in the United States, where scientific evidence of climate change is viewed with some cynicism, a growing number of insurance companies are developing insurance and risk-management products for the low-carbon economy.

Earlier this year, St. Paul Travelers Cos. introduced a new program to offer a 10% discount to drivers of hybrid-electric vehicles. In May, American International Group Inc. announced it was developing a number of products, including coverages for the carbon trading market, as part of a corporate effort to confront climate change.

Fireman's Fund Insurance Co., a subsidiary of German insurer Allianz S.E., is the latest U.S. insurer to enter this arena. Recently, it introduced a series of coverages for buildings that are green-certified, as well as for those with owners who would like to capture green benefits. Before a building is certified as green, it must go through a process called commissioning by a certifying organization. This process involves a professional engineer overseeing the installation and operation of all of the building's systems to ensure that the materials are more energy efficient and environmentally friendly.

Steve Bushnell, a product manager at Fireman's Fund, said studies show tenants in green buildings enjoy lower absenteeism, higher productivity and higher retail sales. "From a building owner standpoint, having a green space is a very positive force in the marketplace, and Fireman's Fund believes that if our coverages are going to address those needs, we're going to expand our market share. Also, green buildings are better to insure, have less risk than traditional buildings, so it's going to improve our profit position as well."

So far, the reaction to Fireman's Fund's green coverages has been swift and positive, Bushnell said. "This is very exciting to us, because we haven't even launched the product yet. We've made our filings, and about 30 states have approved us. We expect by the end of October we'd be up to 40 to 45 states."

Europe's transition to a low-carbon economy has been more robust than that in the United States. Indeed, Lloyd's, Munich Re and other reinsurers long have been innovating products for this segment. Of the products currently on the market, carbon delivery guarantee insurance has had the most success globally.

This coverage is designed for greenhouse gas emissions-reduction projects in developing countries, and the reductions then become recognized as credits under the emissions trading market in Europe and the Kyoto Protocol. The insurer acts as the guarantor of the credits, known as Certified Emissions Reductions, and pays financial compensation in case these credits aren't granted by a governing board according to agreed terms and conditions.

At the 15th Annual Arab-U.S. Policymakers Conference yesterday (transmitted live by C-SPAN), the CEOs of Conoco, Shell, ExxonMobil, Chevron, and Marathon Oil together with the VP of Saudi Aramco spoke of the future of the oil industry ( Afternoon panel - The energy outlook: Independence or Interdependence?).  All of the panelists talked of independence as a myth that only exists in the minds of certain politicians, and stressed interdependence as the way things are and will continue to be with the U.S. needing oil from the Middle-East and the Middle-East needing investments and knowledge from the U.S.

Khalid Al-Falih spoke of the enormous oil resources of SA stressing the fact that they need the knowledge base and the investment (in $$$$) of the U.S. to extract and process their incresingly heavy and sour petroleum.

Stephen Pryor said the U.S. will need 50 mbd from OPEC by the year 2030 - an increase of 50% from today's figures. He was very strong about the importance of improving efficiency everywhere - not just vehicles but also appliances, power plants, buildings, etc. (i.e. reduce consumption). He said that interdepence will bring the needed innovation that will improve efficiency.

Peter Robertson said that "the next 50 years are going to be very, very different from the next 50 years". He also stressed the importance of being "more respectful towards Middle-East countries".

All of them discarded reneweables as an energy source that will satisfy ever-increasing world energy demands.

"the U.S. will need 50 mbd from OPEC by the year 2030 "

Wow.  I wonder what buggy-whip manufacturers projected in 1906 for demand in 1930?

Cars: It Pays to Drive Green

If Joanne Aggens, a Wilmette, Ill., village-board member, trades in her 200,000-mile Subaru for a hybrid, she'll save $50 off the $75 price of her city vehicle sticker--a new clean-car perk she and her fellow board members recently approved. Towns are also using free parking and HOV-lane privileges to entice residents to drive green cars. "It's not going to send a mob down to the local dealership," says Bradley Berman, editor of HybridCars.com, "but it's one more way that a city can encourage civic responsibility."
Cars: It pays to obey road signs

(A little off-topic, yes, but I couldn't resist. Maybe them bollards will be the future of urban traffic ..)

Today White House Press Secretary Tony Snow stated that "contrary to stereotype," President Bush has been "actively engaged in trying to fight climate change." He also took issue with a reporter's comment that the United States has been absent from a global emissions and cap trade program, arguing that the Bush administration has "actually taken the lead on those kinds of innovations."

Video link at:

DOC, the documentary channel showed Waco: Rules of Engagement on Sunday. I couldn't help but think how vulnerable even well-armed citizens are to whoever controls the armored vehicles.

Democracy Now guests talked about increasing of rules requiring special ID to vote, rules restricting voter registration drives that were so strict that the League of Women Voters didn't qualify, that sort of thing.

Oil is down in the $57s as I write so I thought I would review a couple of our old prediction threads.


This was a very interesting analysis by Khebab applying the new technique of Periodicity Transforms to try to identify cyclical behavior in oil prices and extrapolate it forwards. Khebab modeled price behavior up to August 1, near what turned out to be a price peak, and then the PT model predicted an abrupt drop to the mid-60s, which is pretty much what occured. However the PT model then predicted a reversal and by now prices should have been back in the mid-$70s on their way to the mid $80s. Unfortunately for the prediction, instead prices have remained on a downward trend. We are now well below the 95% confidence interval shown on the chart, hence we can reject the predictive accuracy of this method at the 5% level.


This was our most recent price poll, on September 16, asking for predictions through November 16. We're about two weeks away from that so it's worthwhile reviewing where we stand.

In your opinion, in the next two months, oil prices (CLX/Z6) will...
    reach $53/bbl before they reach $73/bbl     12%
    remain in a trading range from $53 to $73/bbl     50%
    reach $73/bbl before they reach $53/bbl     36%
At $57 we are still well above the $53 threshold with two weeks to go, so it looks like there is a good chance that the 50% of TOD readers who predicted "trading range" will be correct. At the same time it's worth noting that readers favored 73 over 53 by a 3 to 1 margin, while in fact we are 3 times closer to 53 than to 73 at present. So the overall shape of the TOD belief curve is not turning out to match the reality too well, at least at this point.

There are still two more weeks to go and a reversal is not impossible in that time frame. If the conspiracy theorists are right and there is some provocation or incident between the U.S. and Iran before the elections, that could send oil prices skyrocketing in a short time. These theories are running out of time though, with only a week before the elections.

Recall that in the previous poll:


only 2% of TOD readers correctly predicted that we would hit 63 before 83. This time around the readership is clearly being more cautious and even if we hit 53 it won't be as much of a misprediction.

After examining the entrails of my pizza dinner I have decided that voting is hazardous to my health and not very accurate.

Oil exploration: Firms keep spending, will returns keep up?

Soaring crude prices may have prompted oil companies to venture into ever hostile terrain to bring supplies to market, yet by one account all the spending may merely serve to hold production levels constant.

According to a recent report from oil and gas consultancies John. S. Herald and Harrison Lovergrove & Co., investment in "upsteam" activities, which incude exploration and production, jumped 31 percent from 2004 to 2005.

Yet the study, based on data provided by publicly traded oil and gas companies worldwide, said production volumes grew just 1 percent, and proven reserves in the ground remained essentially unchanged.

What a shock.  

Yes, that is a shock. Given that the Earth is pretty well explored geologically except in the final frontier areas -- ultra-deepwater, the Arctic -- perhaps they should use the Big Bucks to look boldly go where no man has gone before.

Surface of Saturn's Moon Titan
from the Huygens space probe

Oh, wait, I forgot, it's just a matter of price...

[Some] economists ... think that if you show up at the cashier's cage with enough currency, God will put more oil in the ground
-- Ken Deffeyes


Still, good link, Leanan

For CNN, covering this is a "promising premise". Predictable pity is, it slides into feel-good fast, even if it has to resort to blubber:

Chevron spends 42% more, produces only 8% more, and it's called a fairly decent rise. Rest assured there's some heads in headquarters who think not.

Exxon, with third quarter revenues of $99.6 billion, spent $5.1 billion on capital investments in the quarter, a 16 percent increase from the year prior.

Chevron, with revenues of $54.2 billion, boosted spending a whooping 42 percent to $4.1 billion, mostly due to tapping reserves it acquired when it bought Unocal, one analyst said.

For their investment, the majors reported a fairly decent rise in production, which they credited to their long term investment budgets. Exxon reported a 7 percent rise in production in the quarter, while Chevron said it boosted output 6 percent.

I'd like to know what the EROEI drops down to when these things happen. You spend 35% more money, but how much more energy do you spend?

They have more dough to spend, high oil prices and all that, but doesn't that simply mean the situation is far worse than the numbers already indicate?

Spending 6% more a year on exploration hardly matters when your gaining an increased revenue on the scale of several billion dollars a year at current prices.
Of course, the average American doesn't have a lot of sympathy...

Thought I'd share this from the FTW ASPO-USA coverage, simply because it makes such a bucketful of solid sense.

I find Bezdek's reply a little disconcerting, I'll add.

Lynn Benander of Coop Power, a consumer owned cooperative building sustainable energy resources in New England and New York, was literally booed by a male-dominated audience when she dared to ask a very valid question - perhaps the most important question of the entire conference. I interviewed her after she was disrespectfully shutdown.

"I am concerned because all of the projections (in Hirsch Report 2) for how we are going to address Peak Oil issues are all very large business, significant interventions that have tremendous environmental impact issues," said Benander. "They neglected 56% of our economy which is place-based businesses, non-profits, government entities, and cooperatives that are providing tremendous services and are also places people trust more."

A very brief answer was given to her question from Robert M. Bezdek, who co-authored Hirsch Report 2 (fully titled Economic Impacts of Liquid Fuel Mitigation Options). Bezdek simply stated they don't know how to estimate the impact of the sectors Benander brought up, so they are not included.

"The government is making its decisions about how to transfer our dollars for solutions using this data which is focused only on large business. It continues the multi-billion dollar transfer of public dollars to private hands that's already going on, and this is about making it even bigger. There's such a tremendous flow of money from poor to wealthy individuals, and I believe it's these kinds of policies based on this kind of data that contributes to the problem. We need a different paradigm."

A new article posted at VentureBeat:

Tad Patzek on Brazilian Ethanol

But I doubt this will be a reality check for some of the Silicon Valley snobs who seem to believe that they can innovate their way to anything.

This months EIA data is out. It has August Crude + Condensate down by 179,000 barrels per day from July. All liquids for August however is up 29,000 barrels per day over July. I suppose they produced a lot of ethanol in August.

Yearly averages are for All Liquids are still down for 2006 107,000 barrels per day from 2005. Crude + Condensate is down even more. It is down an average of134,000 barrels per day in 2006 from 2005.

Ron Patterson


My money's still on Deffeyes....

Sorry Oil CEO!! Once again, the current plateau of oil production is part of a continuing cycle that dates back to the mid 80s in terms of oil production. Notice in Stuarts own graph how oil production in the early 90s was flat/declined for several YEARS before increasing. The same could potentially be the same as it is now.
Comparing January to August 2006 with the same period in 2005, crude+condensate is down 119,000 bpd and all liquids is down 127,000 bpd.

A large part of this decrease is due to an upwards revision of US production in 2005 of 57,000 bpd in crude+condensate and of 73,000 bpd in all liquids.

Cry for help here.

I saw a comment yesterday or the day before, listing a heap of benefits from the combination of wind power and <acronym title="vehicle-to-grid">V2G</acronym> operation from EV's.  Single-digit percentages of EV's or PHEV's could allow up to 60% penetration of wind power... IIRC.

I say IIRC because I can't find it any more.  I think it was here.  Can anyone point me to it?

That wasn't it.  (I've read most of AC Propulsion's stuff, and I certainly didn't visit their site this week.)

This is mighty frustrating.  I've been trying to find it all day.

EV World is running a series on vehicle-to-grid (V2G) based on presentations made at the California ZEV Technology conference:

The V in V2G
Putting More Wind on the Wire with V2G

Also, with respect to load balancing of solar PV and wind electricity generation, Shinnar and Citro's research on solar thermal is important. Their recent article in Science gives an overview of their models and projections, and there are similar documents available for free from the Clean Fuels Institute. I recommend "Solar Thermal Energy: The Forgotten Energy Source" and "Decarbonization of the U.S. Energy Mix."

That was it!  Thanks a million!

(Belatedly bookmarked under "Wind", "Vehicles" AND "DSM"!)

V2G is a key part of my vision of an all EV/PEHV future for transportation.
And why not have a few kWh of batteries in the house as well? Sort of a big UPS which the utility could tap in the same way as V2G...
Chemical batteries are quite expensive per kWh, and their life is usually limited by the # of discharge cycles and the depth of the discharge (varies by type of battery)

Why shorten the life and hasten the 2nd/3rd mortgage day of replacement just to help our friend the utility out ?

That is one reason Vehicle to Grid will not work IMO.

Better to invest in hydro pumped storage.  Cheaper per kWh, lasts for centuries, no hazardous waste disposal issues, no incompentent homeowners operating it.  String an HV DC line if it is too far away.

Best Hopes,


Chemical batteries are quite expensive per kWh, and their life is usually limited by the # of discharge cycles and the depth of the discharge (varies by type of battery)
And also by the calendar, for some types.  This means they'll wear out whether you cycle them or not, so you might as well.

Then there are chemistries like Altair Nano's titanium spinel cathode.  15,000 cycles from 0 to 100% isn't something you're going to exhaust easily.

Why shorten the life and hasten the 2nd/3rd mortgage day of replacement just to help our friend the utility out?
Because the car needs the batteries anyway, the cost of using vehicle batteries to do the job is a lot less than the next-cheapest option, and the utility may pay you to help out?
I strongly suspect taht most (perhaps not all) utilities will find building their own pumped storage units will be cheaper & better than using V2G.

Example, Wednesday 3 PM, August 2, 20XX.  Record heat wave, local wind calm in high pressure system.  All FF & nuke at 100% (they can fill storage too in heat wave at 3 AM) and more power needed.

92% of EVs are "off grid" and in employee parking lots, shopping, parked at mass transit stations.  Storage is desperately needed to prevent blackouts and only 8% of EV batteries are available.

OTOH, pumped storage is on-line and load following (marginal source of electricity minute by minute).

Which is cheaper ?

Best Hopes,


You're assuming that the employee and mall parking lots will be off-line.  When you consider that local V2G connections benefit the company and the mall, that probably would not be the case for long.
Hello All,

When is non-OPEC oil slated to peak? When is the great OPEC/non-OPEC crossover supposed to occur?  Would this event be considered the early warning sign that global oil peak is actually in sight?


Hello TODers,

I have been doing some more thinking on our declining postPeak food supply.  Even if wheat or corn is grown locally without FF inputs, then bicycled home to be used starting from it's most raw form, this may not be as efficient as having a community flour mill & bakery.

In my mind's eye: it makes more sense to have a watermill or windmill do the grinding or milling versus a bunch of individuals pounding grains with a stump on a rock.  If grains, or other vegetables need drying or dehydration, a community solar oven is much better for volume efficiency and security than individuals doing this alone on their property.  Also, a bunch of bakers, using either solar ovens or firewood, should be able to make more bread more efficiently than individual families on their own.

Perhaps this might be a good method to jumpstart the permaculture labor shift-- each neighborhood building small, but highly efficient solar bakeries and flour mills.  If one considers how much trucking energy is burned now to basically move a balloon of air in the shape of bread loaves from the regional bakeries to the local grocery stores-- it would make sense to relocalize bakeries very fast.  Besides, nothing smells or tastes better than bread, pastries, and cookies fresh from the oven.  My guess is the investment payback would be much faster than the investment payback on windmills & solar tech dedicated to making electricity.

In short, I think most of us would prefer to sit in the dark--but still eating bread, versus having some electricity--but starving to death.

Bob Shaw in Phx,Az  Are Humans Smarter than Yeast?

Bob, there are a few problems with your take on community efforts on using grain.

First you can store corn and wheat safely at about 12 percent moisture. That and below will not allow for the eggs of weevils and other life forms to hatch. It takes some moisture level for that to happen. So the sun can easily dry the grain to the right moisture level quite easily. Corn in a dry spot and with the husks removed will usually dry itself enough. I have some in my basement rignt now still on the ear and sufficiently dry from this years crop.

BUT you must then store it in airtight plastic bags or food safe drums. I have wheat from 2 yrs ago in some gallon plastic bags and no weevil action as yet.

Grinding: Better to NOT grind the grain until you get near to using it. Grind only what you need. This keeps it from going stale or oxidizing or whatever.

I use a steel burr grinder called Harvest Home IIRC. I have it currently on motor power but the large handle for hand cranking it is still there and one can easily rig a bicycle rear tire with a belt to grind it as well. Doesn't take really that long to grind out a pound or two of corn meal and sift it a bit. Same with wheat. Fun in fact to do it. Later it might be a chore but the labor is really not that much.

Baking. I bake a lot of bread time permitting. I use both San Francisco sourdough culture and yeast , but not together. The sourdough refuses to mold and just gets hard so I grind it with a blender into breadcrumbs which are very handy for cooking.

Ah..so..then a WoodGas stove with a baking apparatus would be the way to go. Whilst your in your favorite hideout hole and the commune has been raided for breedable wimmen and slaves you are snugged down in your goosedown sleeping bag,good to 30 degrees below, you lookout Jack Russel is on guard. Your trip wires are rigged and your sawed off MadMax 12 guage is close by.

The world is still going and your part of it. Your plans have worked well. Tomorrow you will smoke and make jerky of the young fat doe you got with your Hoyt FeatherLight yesterday.

You dream then of making your own raid for a breedable female. A helpmeet , so to speak. One who would appreciate a nice hand cranked grain mill and a big cache of wheat and corn.

Nothing like a good pot of grits to get going by in the morning and that Kentucky Coffee tree down in the holler gives you all the beans one needs.