DrumBeat: July 20, 2006

[Update by Leanan on 07/21/06 at 8:31 AM EDT]

I'm out in the field and away from the computer this morning, but I wanted to post this before I go (free registration required):

Saudi Arabia's oil a huge question

The Saudis say they are still committed to affordable, stable petroleum. But prices have roughly tripled in four years despite periodic Saudi announcements of plans to pump up production.

Control, it seems, has slipped away.

So when the Saudis a few weeks ago suddenly reversed field and announced a production cut, some analysts scratched their heads and wondered if, at long last, Saudi Arabian oil production has peaked. If it has, the effect is potentially huge on oil markets and the price of gasoline at the pump.

[Update by Leanan on 07/20/06 at 9:41 AM EDT]

North Sea oil faces 'dark times'

Oil companies in the UK are being left behind by international competition, according to an industry annual report.

The UK Offshore Operators Association (UKOOA) claimed that record prices could not offset rises in costs for exploration and recovery.

Mexican crude oil exports, output slip in June

India to build SPR

India will start building its first strategic crude oil storage facility in January at Vizag in the southern state of Andhra Pradesh, a senior government official was quoted by the Wall Street Journal Asian edition as saying.
YUKOS CEO quits before "sham" meeting
MOSCOW (Reuters) - The American chief executive of fallen Russian oil major YUKOS (YUKO.MM) has tendered his resignation before a meeting of creditors on Thursday that is expected to take the company a step closer to bankruptcy.

High temperatures may spark power emergency

SACRAMENTO -- Five years after a massive energy crisis roiled California, the state has added capacity to power nearly 6 million more households -- but it's still barely enough.

With soaring temperatures baking California this week, the state is struggling to meet record demand for electricity and is once again on the verge of a first-stage power emergency.

While the situation is far better than the rolling blackouts that rocked the state in 2000-01, California utilities and state officials remain concerned by the ever-increasing demand driven not only by population growth, but lifestyle changes and booming development in warmer inland regions.

France imports power in heatwave

French firm EDF had to purchase 2,000 megawatt hours of electricity from abroad to make up for its shortfall.

Meanwhile Britain turned to expensive oil-fired stations to meet demand but said enough supplies were available.

China to face energy security crisis by 2010

U.K.: CBI chief warns of looming energy crisis

China May Reopen Deep-Sea Oil Hunt

A major gas discovery deep under the South China Sea could reopen a frontier for oil and gas exploration that some multinational companies abandoned decades ago after shallower wells turned up dry, said the chairman of Cnooc Ltd., China's biggest offshore oil producer.

The Best Nuclear Option

The U.S. Energy Department's fuel-recycling initiative could be a distraction from a more achievable goal: reviving today's nuclear industry and averting some carbon emissions in the short term.

Amory Lovins on nuclear power

Tom Whipple writes about the media and peak oil:

The Wall Street Journal's treatment of peak oil is the complete opposite. They don't want to even think about it. They would rather read that a giant meteor is heading for the earth and it will all be over next week than to contemplate the possibility that the GDP just might stop growing because there is no longer enough oil.

Goldman Sachs: Rising Biofuel Use to Drive Up Crop Prices

Peak oil not piquing the interest of CVRD board

An inconvenient hill. A house in the lowlands is great if you plan to lug 300 pounds of manure home on a bike trailer. It's not so great if global warming causes the oceans to rise.

That story out of Mexico is interesting, if short-term.
Pemex said crude oil exports fell to 1.776 million barrels per day from 1.831 million bpd in May, while production dropped to 3.287 million bpd from 3.329 million bpd in May.
Usually graphs of United States peak show only year-by-year results that go into decline starting in 1971 I believe. Does anybody have the month-by-month figures at the moment of exact U.S. peak production? I'm curious to see how noisy the data at that time was, and whether there were some months where it made a short-lived rebound.
Note that Mexican oil production fell by about 1%, while net oil exports fell by about 3%, i.e, net exports are being squeezed by both falling production and rising consumption.  With Cantarell crashing, these numbers are like little pebbles falling down the mountainside, in advance of an avalanche.  

Also note that while the Russians are claiming higher oil production (I have my doubts since they were pushing the IPO), they are admitting to declines in net oil exports.

I predict successive rounds of bidding for declining net oil export capacity, and I continue to predict that net oil export capacity will fall faster than total world oil production.

There was a 42,000 bpd drop in production, 55,000 bpd drop in exports. Meanwhile, the natural gas treadmill is speeding up for Mexico: 10 million cubic feet per day drop in production, 55 million cubic feet per day rise in imports (almost all from the US, I believe). Small numbers, right now.

Annualize these numbers and it gets really scary-- 660,000 bpd drop in oil exports, or about one-third of total exports to the US. Combined with continuing troubles in GOM, and on shore depletion in the US, and we suddenly have to replace between 5 and 8% of our total consumption from other sources. Not even the new expansion at Syncrude is going to dent this.


Hello TODers,

Outgoing Mexican Presidente' Vicente Fox calls for runoff election to help calm the situation and establish a voting majority.  I am still looking to find additional confirmation from other newsources, as I have never heard of this link before [SperoNews], but I am just trying to keep us TODers up to date on what is increasingly become a polarized country.

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

Interesting!  If it turns out to be real, then I will find the silence from the MSM propaganda organs to be very revealing.  OTOH, I'm unlikly to think much better of the MSM even if it isn't! ;-)
Hello Twilight,

Thxs for responding.  I think the American organizations should send some of those statisticians that analyzed the Florida[2000] & Ohio[2004] votes down Mexico way to help physicist Luis Mochán of UNAM complete his voting analysis to help resolve the Mexican Standoff.

Even better--send Stuart Staniford's and Khebab's resumes' down South.  I bet the Mexican Election Board [IFE] would hire these guys for huge $$$$ to do their wonderful data freak computational analysis on the Mexican vote.

The more I look at the statistical graphs of the election-->the more I think something is rotten: but I am no expert.  Hopefully, Freddy, Dave, DuncanK, and other TODers will comment on these disturbing graphs.

Top link excerpts:
Doing maths in Mexico

While Mexicans take to the streets over the presidential vote, democracy's fairweather friends are standing silent.

Yet the stalwarts of democracy outside Mexico are silent. Bush has congratulated Calderón, not waiting for the court to rule. Reuters and Bloomberg echo the confidence of the elites that Calderón will win in court - never mind whether he won at the polls. When The New York Times is heard from, the headlines tell us of the "leftist claims" about the occurrence of fraud, while Calderón is described as "presidential." The Times never doubted that fraud did occur in Ukraine. In Mexico on the other hand, it seemingly renounces any duty to examine the facts on the ground.

Here's one difference between the two situations. In Ukraine, it was extremely hard to learn exactly what the evidence of fraudulence actually was. In Mexico, it is extremely easy. That is because the Mexican electoral authority, known as IFE, posted the ongoing count on its website in real time, an initiative called PREP. Independent scholars kept a record of PREP as the night progressed. A statistical analysis of that record does not, of course, constitute proof. But it brings to mind Henry David Thoreau's remark that circumstantial evidence can be very strong, as when you find a trout in the milk.
Arizona is obviously on the front lines with Mexico.  If this election goes really bad, we will be swamped with refugees.

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

Thank you Totoneila for your updates on the Mexican Presidente' elections. I for one look forward to more as they develop. Please keep us updated.

By the way! I quit watching TV for the past 6 six weeks, and guess what?
 I don't miss it. ocassionally i'll walk past one and see a snippet here and there, i noticed CNN, MSNBC and FOX can flog a dead horse forever. GEEZ, i find other things to do. Though i have enjoyed the history channel and national geographic channel on the variety of topics, i do not miss TV at all.

I could go on a long time about how pleasant it is not to see or hear main stream media or reality shows. GEEZ!

Note that, again based on Khebab's excellent work, Mexico arrived at the 50% of Qt mark this year.  

If you limit the HL method to regions that have produced about 2 mbpd for 20 years or so, I am not aware of any case histories where the HL method failed.

And from Bloomberg today about remote Russian island drilling north of Japan.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aCi3NokxCtys&refer=exclusive_to_bloomber g

Shell Slips on Sakhalin Ice, Costs in Fight to Boost Reserves

i wonder whether the net oil exports will be the light sweet or the heavier grades.
 a very good point
Is this historical chart from the EIA what you want?

I took that historical chart, converted it to a CSV file, then plotted the 5 years surrounding the peak. The graph below is what I got. It shows that things were very noisy then and that we had a situation very much like the last 24 months, some months up, some down, but no real clear trend til a few years had passed.

Click on the image to see it full sized. I didn't want the graph to blow up the entire page formatting. I've saved the image at flickr. Hopefully I've got the URL right for others to see it.

At a guess, it's going to be a lot sharper for fields that have been doing water flooding for a while.
GZ, thanks. This is exactly what I was looking for.  Interesting.
From BusinessWeek:

Can't Stop Guzzling: Rising prices are supposed to curtail consumption. So why doesn't that hold true for American drivers?

Gasoline keeps getting more expensive, but Americans keep buying more of it. They bought 10% more gasoline in the first half of 2006 than in the first half of 2000 even though the price at the pump rose 75%. It isn't just essential trips, either--leisure travel remains strong. Gasoline consumption during the week of the Fourth of July holiday this summer was 2% higher than a year ago.

It would be interesting to see what the per capita gasoline use is.  Our population is increasing, so presumably energy use will, too, barring extraordinary measures.

More typical is Scott Parker, 36, of Manhattan, who fills up his Nissan XTerra SUV three times a week at around $50 a shot. Parker enjoys road trips on weekends. And although there is a commuter train to Norwalk, Conn., where he works as a marketing director, he prefers to drive. Says Parker: "At the end of the day, I'd rather be on my own schedule." The extra cost of gas goes onto his credit-card balances, which he plans to pay off with his end-of-year bonus.

Great...but what happens if his company has to cut back and doesn't give him a bonus?

CNN had a segment yesterday about how people are dealing with high gas prices.  A lot of them are doing what Mr. Parker is doing, and putting it on their credit cards.  Gotta wonder how sustainable that is...

Not to mention the accumulated interest.  This guy will just be more road kill when peak oil really starts to kick in.
not to mention the fact that he's definitely on the wrong side of Westexas' "net producer" choice of professions - he says he's a marketing director - seems like he'd be a good candidate for working in the fields when positions like his suddenly become completely expendable
If $150/week really is his average, he is spending almost $8000  on gas and driving about 50,000 miles per year (assuming $3 gas and 20 mpg).  Not to mention spending about 1,000 hours per year in his car while racking up all that credit card interest.  Not a lifestyle I'd want.

Here's another article from the NYTimes, not quite as "bullish" as the BusinessWeek article regarding fuel consumption:

Reluctantly Adjusting to Oil Cost

"For a long time people anticipated that gas prices would fall back, so they ran up more debt to cover their higher expenses without cutting back on purchases," said Richard T. Curtin, director of the Michigan surveys. "And now they have reluctantly concluded, in the past three or four months, that gasoline prices are not going to go down."

"Rising gasoline prices are really driving a wedge between lower- and higher-income households," Mr. Curtin said.

I've noticed a resurgence of anti-hybrid feeling on the road recently.  Do they hate me for being right?
It's cultural differences between affluent, educated PO-aware folks and Joe Six-Pack. You're a member of a different tribe, thus a threat.
Possibly.  One guy (in a pickup) was gesticulating at me wildly for only going 35 in a 40 zone.  He was ignoring the fact that I was right behind another pickup also doing 35.  The truck and I were both doing 35, but I was in another tribe.

You're either with them or against them.  Welcome to the New American Century.

Were you the guy directly in front of him?  That is probably why you received the bulk of his anger.  I doubt he even understood you were driving a hybrid car.
I do the math about the same except that if this character is doimg 50,000 miles a year between Manhattan and Norwalk he is not averaging 50mph. He is in his XTerra 1500 or 2000 hours a year, That's why he drives around in his living room. He lives there
The text immediately after the passage you quoted reads:

"Why the resilience? After all, when prices of most things rise, people buy less. You would think they would react to costlier gasoline by gradually making such adjustments as carpooling, switching to more fuel-efficient vehicles, or even getting a job closer to home. To an extent, they do. Energy Dept. economists say gasoline consumption, driven by an expanding population and economy, would be even higher today if prices hadn't risen."

Higher prices do restrain demand.  In this case, the downward price pressure on demand was overwhelmed by the upward pressure on demand from an increasing population and economic growth.

Agreed that higher prices restrain demand. This was also the thesis of yesterday's EIA This Week in Petroleum report (News Flash: High Gasoline Prices Do Restrain Demand).  I think the market is working more or less as it should right now.  That is not to say it is not causing pain, especially for lower income earners and certain businesses, including GM and Ford.

Here's a rare free Wall Street Journal article:

States Boost Speed Limits On Major Highways: Moves Come Despite Concerns Over Safety, High Gas Prices; 80 Miles Per Hour in Texas

With gasoline prices approaching an average of $3 a gallon and Middle East strife escalating, it might seem like a bad time to encourage drivers to burn even more fuel. But speed limits on stretches of freeways around the country are rising -- just in time for summer road trips.
I expect that the low gas prices that prevailed until about two years ago "hard-wired" a good deal more energy consumption into the economy, and that it will take higher prices a while to begin to destroy demand. Much of the country's population growth, for example, was at the suburban or exurban fringe, and many jobs followed the workers out to suburban locations. Many people replaced older, more fuel-efficient cars with SUV's. Big-box stores and "power centers" replaced smaller, nearby shops.

These items -- houses, office and commercial buildings, cars -- are big capital investments, and are not easily or frequently replaced. Folks may be inclined to go into debt to hold on to a lifestyle in the hopes that the current high gas prices will pass. If one relies on the MSM for news, one could get the impression that the high oil prices will pass, and everything will go back to "normal".

"....just finished an 800-mile trip through the Northeast in his 515-horsepower, bus-size Newell Coach recreational vehicle. Features include heated granite floors, a full-size washer and dryer in the master bathroom and a tow for his GMC Envoy SUV"
Fuel cost him maybe $450 for his 800 miles.. didn't bat an eyelash.
Why would he bat an eyelash? Do you have any idea how much the stuff he's driving around costs? $450 barely rises to the level of pocket change.
I just did a quick search and injured my jaw (it fell on the floor).  I knew they were expensive, but the cheapest Newell Coach I saw was $540,000.  So $450 is roughly...ooohhh .0008% of the cost of owning the whole rig (conservatively).
If you can afford a Newell Coach, you are not woried about $450!
Yeah. That is my point. How do we prevent wealthy consumers from taking us all on a one way energy crash dive?

It's not just all the average folks in 'developed' countries who will get priced out as he drives the palace on wheels around at $5 or $6 a gallon. It is a whole bunch of 'developing' world farmers and businesses that can barely afford to operate now. "let them find more labor intensive sustainable methods and ride bicycles" we say, not realizing we are talking about us pretty soon.

It seems we tax the heck out of cigarettes and booze. I believe the rates are higher than on gasoline and diesel. Seems like we could come up with a fair way to target over-consumption of FF. Our singular addiction.

Very problematic, I know, but I'll take a crack at it. We now ration by price and the price rises because some individuals have lots of money and can afford all they want.
Good let them have it. Only add on the carbon reduction tax. Subsidize wind, rail, and solar with it.

Allow every tax paying wage earner filing their own taxes a standard deduction equal to the equivalent tax based on a moderate amount of liquid FF. Enough to get most folks that commute and some to spare in an economy car. Buy an electric car or a hybrid.. keep the deduction. Ride a bike ..keep the deduction. Don't drive ever ...and so on.

I know. What do we do about businesses. What about the unemployed? Well...?

We've kicked this around before but we it seems it can't work because it's 'regressive' or encouages people to have more kids or something. For Peat's sake let's figure out a way to put some of that 'waste' to work.

How do we prevent wealthy consumers from taking us all on a one way energy crash dive?

Well if their money can't buy services from the 'we' without oil... that would put an end to their lifestyle, right?

Now how many of you opted to not work for someone because they had too much money and were willing to overpay you for your labor?

Do you really think America's fuel problems are caused by people driving Newell Coaches?  Why don't we put a tax on distance you live from work?  That probably contributes far more to our energy usage.  Or let's tax ludicrous television shows (i.e. all of them including the news) because whatever energy they use creating the show is a waste and should be discouraged.  Or how about frivolous foods at the supermarket?  Let's get back to a healthy complementary protein diet and do away with meats (an massive waste of energy both from a fuel standpoint and from an efficient use of feed standpoint).  Who gets to decide which eoyments are justifiable and which should be taxed into oblivion?
If nobody but the very rich are driving, who's going to pay all the gasoline taxes to keep the roads and interstates maintained?

I don't really see much future in roads and highways ...

Yet remarkably (and sadly), our politicians keep funding road projects.
Xxxburb, I'm feeling pessimistic these days.    

I feel like someone who has been warned about a coming tsunami - the water has receded and I'm moving to higher ground, but most people don't believe it and are out wandering on the newly revealed beach.  I don't know if I'll make it to higher ground in time or not, but I can guess what will happen to them.  Meanwhile we talk about how to stop the tsunami, but I'm thinking it's unlikely that any of it will happen.

How do we prevent the wealthy from screwing us over?  We don't.  It's how things are.  Democracy was a good try, but it is failing - destroyed by the wealthy and power hungry, as these things meant more to them than the society, and the people allowed them to get away with it.

Democracy was a good try, but it is failing - destroyed by the wealthy and power hungry, ...


Me thinks you are confusing terms.
"Democracy" simply means rule by all the people themselves.

What you complain of is actually the Smithian Religion.

When we are young, we are taught many religions.

One of them is to get a high paying job.
To be a success.
To be a millionaire.
To take care only of ones self.
To maximize profits.

The Invisible Hand will take care of everything else.

So what do you see?
Millions of people following that programming.
They are doing as they were programmed to do. What more should we expect?

I don't know if any of you read TWIP, but they mentioned that  the increase in gasoline consumption this yr. is actually not that unusual if you look at consumption since 2000. It would be best to read the article. The jist of the article says that since consumption has not been increasing at historical rates since 2000, consumption this yr would actually be a lot higher if gasoline demand was growing at an annual rate of 1.5-2.0%/yr.

Also, I'd like to mention that Harper's magazine has a pretty good article on peak oil that I am still reading. I'd recommend people to buy it and check it out.

Sorry, if other people have mentioned either of the above stories elsewhere. I don't really have the time to peruse all the posts to make sure this one isn't redundant.

Found this article about Clinton's former Trez Sec, Rubin, who is now screaming that things have gotten out of whack from globalization that he promoted!


Economists from the Clinton era were once the biggest cheerleaders for free trade and pro-business policies -- but now economic uncertainties have them singing a different cheer.

Rubin now freely acknowledges what the American establishment for many years denied or dismissed as inconsequential--globalization's role in generating the thirty-year stagnation of US wages, squeezing middle-class families and below, while directing income growth mainly to the upper brackets.

Where there's a great deal of insecurity, where median real wages are, roughly speaking, stagnant...where a recent Pew poll showed 55 percent of the American people think their kids will be worse off than they are, I think there is a real danger of heightened difficulty around issues that are already difficult, like trade.... Look at the difficulty around immigration."

I think the 55% is staggering.  PO will not make this easier, so at least we're starting to wake up that things aren't always going to get better.

Salt Lake City (that noted hotbed of liberal activism) is planning to triple taxes (yes TRIPLE TAXES) in order to build 4 Light Rail Lines by 2014 instead of 2030.

Of course there is political wrangling about just which taxes to raise (property or sales, with or without a hotel tax supplement).  

I think that they are optimistic about Federal Match Funding (probably OK with R control, but not with D control of the feds IMVHO).  But this is enough money to build all 4 new lines with minimal federal contributions by 2019 or so.

Today SLC has one long (19 mile from memory) Light Rail line that is a major success and a commuter rail line close to opening.

There are more Urban Rail lines (cimmuter & streetcars) past the four new (5 total) Light Rail lines above, but these will be the "core".
    TRAX is on track to arrive on ballot
    Vote expected today: Major hurdles remain, but it appears the county will let voters have a say
    By Derek P. Jensen
    The Salt Lake Tribune
    Salt Lake Tribune

  Want to take TRAX to Draper or West Valley City? How about jumping aboard from the Jordans, perhaps for work? Or hitching a rail ride to the airport?
  It's up to you.
  Government leaders are expected to vote today to place the proposed $895 million TRAX expansion on November's ballot, according to a straw poll of the Salt Lake County Council.
  "It's the right thing to do," Councilwoman Jenny Wilson said Monday.
   If voters agree, the Salt Lake Valley will see four new light-rail routes - to Draper, West Valley City, West Jordan-South Jordan and Salt Lake City International Airport - by 2014.
  The property-tax price for the ride: $108 more a year on a $200,000 home.
  One possible hitch: It may not be legal.
  A question looms over whether the county can issue a near-billion-dollar bond for an asset it does not own and turn it over to the Utah Transit Authority. The District Attorney's Office will issue an opinion by Aug. 1.
  Meanwhile, most council members point to polls showing the public wants to see TRAX at the ballot booth. One, conducted for UTA, put that number above 90 percent.
  "That's almost incontrovertible," Councilman Randy Horiuchi said Monday. "I'm totally on board."
  And a Salt Lake Tribune poll in June revealed 60 percent of county voters would approve the bond measure.
  Monday's survey of the council signals that all four Democrats and at least one Republican - David Wilde - plan to approve the ballot move.
  "That's terrific," UTA spokesman Justin Jones said. "We've worked very hard to put together a plan to bring TRAX throughout Salt Lake County 15 to 20 years ahead of schedule."
  Without the tax boost, transportation planners note the new TRAX lines would not be completed until 2030.
   Despite the apparent council support, the funding mechanism continues to be contentious.
  Councilman Mark Crockett worries the proposal would "max out" the county's bonding capacity and take flexibility away from school districts.
  Several council members and some state lawmakers prefer tapping sales taxes for TRAX expansion.
   Council Chairman Cort Ashton fears the property-tax plan would dissuade businesses from relocating to Utah. A finance model from the county reveals the annual tax bump on a business worth $1 million would exceed $1,200; $6,400 on a $5 million business.
  "It's a step backward in economic development," Ashton said. "We may be shooting ourselves in the foot."
  To avoid that, Councilman Joe Hatch vows to float language giving the county the ability to switch to a sales-tax source or even hotel taxes to pay off the TRAX bond if the Legislature signs off.
  House Speaker Greg Curtis has said he would like to hold a special legislative session to discuss funding - he prefers using sales tax - if the council places the TRAX bond on the ballot.
  "We're pleased that they're moving ahead," Salt Lake Chamber President Lane Beattie said. "But we're hoping that between now and November, the Legislature can come up with something that makes more sense."
  Another issue is federal matching funds.
  Hatch explains UTA would be eligible for more once voters approve the tax.
  "There is really no alternative in light of the requirements of federal funding matches that we can do this on the cheap," he said. "We have to ask for all of it upfront."
  But Hatch, like Curtis, is interested in funneling hotel taxes, which he projects to be worth $160 million over a 25-year bond.
  "That's $160 million that won't have to be raised in property tax," he said.
  If the Legislature decides to use hotel cash, perhaps in a special session, it could spell the end for a Sandy soccer stadium, which relies on that pot of public money.
  Still, before any money could be steered toward TRAX, it must be approved by the bond counsel, notes Karl Hendrickson, attorney for the County Council.
  The legal question, Ashton says, is a "pretty significant one."

       Who plans to put the TRAX bond on the ballot?

       * Cort Ashton - No
       * Jim Bradley - Yes
       * Mark Crockett - No
       * Joe Hatch - Yes
       * Marv Hendrickson - Unknown
       * Randy Horiuchi - Yes
       * Michael Jensen - Undecided
       * David Wilde - Yes
       * Jenny Wilson - Yes

URL is:


I was just in SLC for a conference last week.  It's a strange city, and I don't mean that on account of the mormons who are extremely friendly and generous people. I mean from a city-planning stand-point. Nearly every downtown street is 7 lanes wide and one way.  It is nearly impossible to cross the street on foot safely bc/ you have to run to get across before the light changes.  They even have brightly colored flags that you can hold up over your head as you cross so that drivers are more likely to see you if you don't make it in time.  It's also nearly impossible to make a right turn in a car followed by a left turn at the next intersection bc/ you have to cross 6 lanes of traffic to make your turn.

Nevertheless, I found TRAX to be easy to use, comfortable and clean. When I accidentally left a bag on the train, they went out of their way to retrieve it for me.  I applaud their effort to expand it.

From what I've been told, I believe the original reason for the wide streets in SLC was to allow a many-horsed carriage to easily do a u-turn... Guess this turned out to be approximately 7-lanes wide in the era of the automobile.
Oxen actually, it was explained to me.
God that's sad. Not for Salt Lake City, but for us here in Orlando who dismay that we're still arguing about starting ONE rail line using existing tracks...
Production Sharing Agreements

The Bush administration and its supporters have strongly and consistently denied that taking over Iraq's oil was a major (or even minor) factor in the decision to invade and occupy Iraq.

However, some analysts have suggested that the real Anglo-US strategy with respect to Iraq's oil was to install a government and constitution that would grant P.S.A.s (Production Sharing Agreements) to Anglo-US oil companies.

PSA's are normally used where the host country has insufficient funds/technology for exploration and development, or where there is great risk that the investment in exploration will pay off.

This and this are two articles that expound on PSA's in the context of Iraq.

Per those articles, companies with PSA's pay the host country as little as 1% of the "value" of the oil/gas extracted.  A while ago, CBS 60 Minutes reported that Equatorial Guinea's dictator received 12% from ExxonMobil and Marathon (WaPo article). That, however, is sufficient to keep the tyrant and his mafia in power and luxury.

Does this claim of the Anglo-US strategy have any validity?

Just a quick update on what I've been doing since the last time I told you.  I get work done fast and faster still as more and more people learn and try to find ways to answer the peak oil problem.  I'm not too far from making my own full time job of working for implementing solution regarding peak oil.

I have written what was done with a diagram of the few solutions I try to implement here.  I will probably be able to relate my work after the next 2 weeks,  I'm one of the organizer of the International Swimming marathon in Roberval. I organize the day camp for youngsters, organize a parade and a beach party.  Yes, I'm busy.

Well you can get a sense of what I'm doing regarding peak oil at this web site.  This is a new posting for the relocalization network.  I hope it will help some of you.
Pascal Gagnon new blog

Just read the 2nd post and download the solution diagram, it's one of the best diagram of the mental representation of part of the solution regarding peak oil.  It's more a systemic approach than a silver bullet solution.  Since we all know peak oil is a systemic problem, only a system wide solution can give us some headroom.

It may not apply for you all but some of it is good.  I can do it because I know a lot of people but don't underestimate what you can do at the local level.  That's what's driving me!

Have a good day|


Great work, Pascal.  Likely you know about this conference, but just in case you don't, or someone else who would be interested, I thought I'd post this info that just came from the Community Solutions newsletter:

August 20 - 25, 2006
Personal & Community Preparedness for a Low Energy World
Location: Waubaushene , Ontario   CANADA
Contact: Sustainable Lifestyles
More info: http://www.sustainablelifestyles.ca/

Hi Liz,

While I would love to go there, it's a 8 to 10 hour drive from where I live, hardly near enough.  The workshops are looking very good indeed.

Beside I will be very busy starting our own relocalization planing group here in Roberval.  I plan to get enough political support from local city council and politicians to put the Peak Oil problem higher on the National Agenda.

So I guess that what I will do regarding peak oil will have some impact at least Quebec wide.  I hope it will spill in Ontario or further in Canada.

We will see what we can do.

Tesla Roadster is unveiled.

0-60 in 4 seconds
250 miles on a single charge
100,000 miles battery lifetime
about 1 cent per mile at current electric rates
135 mpg equivalent
130 mph top speed

The era of the electric car may be about to arrive. The only question is how long it will last.

No, the only questions are how much it will cost, and when can I get my hands on one. I remember test driving the Saturn EV-1, which took off like a rocket-- the salesman sitting beside me, when we accelerated from a stop sign, said be sure to have both hands on the wheel and the tires pointed straight ahead when I floored it. That was a feeling. Couldn't sell one to me because I lived in Tennessee, thirty miles from the Saturn plant, instead of California.
$80k, according to the Wired story.  With 6,831 Li-Ion batteries, I have a hard time picturing this being a scalable car alternative.
"With 6,831 Li-Ion batteries"

Looks like they pulled a trick out of the AC Propulsion handbook (http://www.acpropulsion.com/) because they assembled a giant Li-ion pack out of a gazillion tiny batteries for the T-Zero.
September 15, 2003


A new lithium-ion battery has replaced the lead-acid battery and saved 500 pounds. The whole car weighs in at 1970 pounds. And despite weighing less, the LiIon tzero carries three times more energy than before. "The results are staggering" according to AC Propulsion President Tom Gage. "The LiIon tzero will drive 250 miles in left lane traffic, in LA that means 75-80 mph. Alan Cocconi (AC Propulsion founder and chief engineer) drove it to San Diego and back without charging. On any type of standardized drive cycle it will go over 300 miles". The weight reduction improves performance too. For the LiIon tzero, acceleration from 0-60 mph in under four seconds has become routine. The best time recorded so far is 3.6 seconds. Higher voltage with the LiIon pack also improves high-speed power. Governed top  speed increases to just over 100 mph.


AC Propulsion assembled the tzero LiIon battery from 6,800 standard cells. The cells, designated 18650 based on dimensions of 18mm diameter and 65 mm length, are slightly larger than the familiar AA cell. Within the industry, 18650 capacity is in the 1.8 - 2.0 Ahr range with a peak discharge of 6A to 8A. The 18650 cells weigh 43 g. Specifications have been improving about every six months.


"The market for big cells is small so they cost too much. The small cells for the tzero cost less, in
total, than the nickel-metal hydride battery in the Toyota RAV4 EV, and they hold twice the energy.
We got a quote from one battery company for a Li Ion pack made from 100 much larger cells. Their price was 10 times higher, and neither the energy or the power were as good as we get from the small cells. The 18650 is a mass-produced, completely commercialized, off-theshelf product. It keeps improving and prices keep coming down. If you want to start building electric cars right now, as we do, you have to have a commercial battery. Right now, 18650s are the only game in town". Each 18650 cell used in the tzero includes a built-in PTC current limiter and a membrane that stops current at very high temperature. AC Propulsion has developed proprietary current collector technology and battery control hardware and algorithms that sustain cell balance and maintain operation within cell voltage and temperature limits.

Obviously I know/knew nothing about electric cars, because this is one of the most amazing things I have ever seen. I have no idea why this has not got more press (except for the power of the Iron Triangle). Zero to 60 in 4 secs from an electric car is frigging unbelievable.Unless this is an extremely elaborate hoax, it shows that the car culture (and street racing) will definitely survive post-peak.
It is no hoax, electric engines have a huge torque, that is what makes it go to 60 mph so fast. While this might sound nice I won't buy a vehicle just because it has a nice acceleration. There are other (costly) problems with electric vehicles, such as battery aging. You might have to change the battery pack every 2 years!
I remember the old electric busses (they had tracks on cables elevated above the street on which two poles rode on) the CTA in Chicago had on some routes thirty-five years ago. The acceleration from a standing stop was incredible, especially if the driver was trying to get done with his shift early. I really miss them.

Want a kick in the pants?  The AC Propulsion T-Zero has been putting out stats like sub 4 second 0 to 60s, drag racing ferraris and porsches for over three years.


At 8 cents a kwh, that's 8 miles per kwhr.   That 1 cent a mile seem way lower than estimates I've seen for other cars like the PHEV Prius. Given this car's power, that seems like fuzzy math to me and also does not consider battery efficiency.
And more importantly, does not consider the cost (and embedded energy) of the limited-life batteries.  Even if they do last 100,000 miles (at how many miles per year? what % discharge each cycle?), that'll be several more cents per mile.
Discussion here:


Seems there's a catch - some are saying the batteries have to be replaced once a year!

The Tesla website claims 100,000 mile battery life.
I own several electric bikes and have been around the various battery types for a few years now.  The sealed lead acid (SLA) batteries are the best bang for the buck but are very heavy.  They work well on a bike but fail in a car due to their weight.  Next in line are the Nickel Metal Hydride (NIMH) batteries at half the weight of the SLAs.  They are well proven but a little expensive; about 3 times the price of good SLAs.  After that you have the Lithium Ion (Li-ion) batteries at 1/4 the weight of the SLAs.  These are what are in the Tesla.  They are only made in small formats (think D cells) so that is why you have so many of them.  They need circuitry to monitor their charge state and health.  They are very expensive, like 6 times that of SLAs, and prone to problems.  I stick with the SLAs and NIMH for my bikes.  But for a car the Li-ions will work great because of their low weight.  Once the cost comes down and the form factors are made larger small ecars will be born.  This has so far been driven by development of batteries for laptop computers.  My advice for the future: buy an electric bike!
IMO NiMH is a proven technology and there are RAV4 EV's from (the year) 2000 still running around on their original pack proving it.  Some with 150,000+ miles on them.
The Lithium batteries can still blow up. I wouldn't drive such a car.
   Yes, but you can recycle the lithium batteries to make meth and pay the costs of new batteries!

Large format battery, built to be safe from explosion in collision and fire, no need to strap together bucket fulls of tine cells....Lithium ion

Folks, you all don't seem to realize that we are MUCH closer to a revolution than most folks think.....think small sedan or aerodynamic minivan, Lion battery pack, a small two cylinder piston Diesel or CNG engine placed to drive the airconditioning and provide supplemental power and range, or, a micro turbine gas turbine engine to do it....plug hybrid to charge at night when the utility plants are sitting at an idle, so that the battery never can be managed by low demand recharge from the gas turbine or piston engine....testing by Cal Cars and others have shown a pretty easy 85 to over 100 miles per gallon, in a comfortable, modern vehicle, probably over 150 mpg in a small runabout commuter.....it sure changes the timing of this game!

But, does America have the designers, engineers, technicians, electrical engineers, mechanical craft and trade people to build it.....or are we sending our kids away from education to spend their lives as peasant farmers staring a mule up the azz...

Alvin Toffler called it back in the 1990's, "yearnings for a new dark age."  I come more and more everyday to see how right he was and what a threat it is to our nation.

Roger Conner   known to you as ThatsItImout

Now for a look at that battery, check it out, same size as a standard 12 volt, superior power and cycle discharge characteristics, I did I mention the inert powder to prevent fire/explosion...

Roger Conner  known to you as ThatsItImout

Roger: You make a good point.This roadster is $80000 but with mass production (probably in China) the price will come down. A heavier more convenient vehicle would be slower but when they already have 0-60 in 3.6 sec speed is not an issue. This car already sounds like the chink in Kunstler's armour of a suburban wasteland. Why are most knowledgeable persons in this area on TOD so down on these cars? With enough investment it seems like they could do a lot to ease the liquid fuels crisis. Imagine if the guv subsidized them like they subsidize ethanol.  
For at least the next decade, the extra marginal demand for electricity will be largely meet by natural gas.  This would be fine if the # of BTUs dropped significantly, but they don't with EVs.  Trading 3 oil BTUs for 1.5 NG BTUs and 0.5 coal BTUs or 1 NG BTU & 1 coal BTU is not a "Great Leap Forward".

EVs do not change the Urban Form to a more energy efficient living pattern.  Urban rail does.

Any gov;t subsidies should go for Urban rail and electrifying our freight railroads.  This is where the BIG energy savings are !  Let EVs "make it" in the market place w/o gov't subsidies. (If we are spending $20 to $40 billion per year on the best solutions for PO & GW, then I could see room for some EV subsidies; but not before).

AlanfromBigEasy says,
Let EVs "make it" in the market place w/o gov't subsidies. (If we are spending $20 to $40 billion per year on the best solutions for PO & GW, then I could see room for some EV subsidies; but not before).

I think EV's have a huge role to play, but I agree with Alan.  I don't se the need for a government subsidy.  If we actually think peak or anything like it is coming, and the technology is developing as fast as it looks like it is, I don't think they will need one!

Roger Conner  known to you as ThatsItImout

Hello Roger and Alan,

My ideal guess is that we will eventually be so energy stressed that fossil fuel will go to electrified RR, and any batteries will be strictly dedicated to electrified trucks and tractors to move essentials from the rail station to the outlying localities.  The rest of us get to pedal to our hearts content.  The truck batteries then get re-charged nightly during the off peak grid demand hours.

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

I would just add 3 story houses/condos/apartments would line the streetcar routes and medium rises (say 5 to 12 story) would cluster around the light rail stations.  With garden plots within walking/bicycling distance.

Think Switzerland 1943.

Good point.
Alan, you forget one thing:  gas turbines are flex-fuel.

An auto engine needs fuel with a relatively narrow range of octane ratings, vapor pressures, and so forth.  The gas turbine of a combined-cycle plant can burn whatever its combustor system can handle, which might be anything from desulfurized fuel oil to landfill gas.  This takes a lot less refining, and is cheaper to boot.

More to the point, the CC system can hit thermal efficiencies close to 60%.  This is at least 3 times as good as the typical car, even before you add in the efficiencies of the typical hybrid.  On top of this, capital cost of gas turbines is low.  If you had to turn to oil to make the juice for a nation full of PHEV's, your immediate savings would be "only" about 2/3 as much as the consumption at the pump would suggest (you'd get the remaining 1/3 over time).

I think we could manage.

With significant help from GE (or Siemens) one can run a wide variety of gas or liquid fuels in a combined cycle NG plant.  And you have the heat rates about right.  AFAIK, fairly high pressures are needed to inject fuel into gas turbines.

Landfill gas (typically low BTU content) from even the largest landfills is rarely above 10 MW.  So good to blend a few % into a gas turbine fuel stream.  In reality, diesels are typically used.

Some refineries take "whatever" would flare off, compress it and feed it into their on-site gas turbine.

Outside of landfill gas, there are few other renewable fuels available in quantity and even remotely economic.

In computing efficiencies, one needs to consider transforming & transmission losses; ~10% for residential users.  Then battery storage losses (charge + discharge), which vary by type.  EVs will carry the maximum possible amount/weight of batteries in order to get range.  This implies a higher weight/payload for EVs vs. ICEs.

IMHO, EVs will likely be "down sized" cars from the ICEs that they replace.  But will they be ?

Will EVs simply reduce their owners total miles (avoided long trips) or increase them (more "around the corner" trips) since fuel costs are lower & invisible ?

The hypotheticals and uncertainities, like most things PO, are large.  The exact savings from going into EVs are somewhere in a wide range of estimates.

But I stand by my statement that EVs will not be a "Great Leap Forward".

IMHO, they will delay the next round of energy problems by a generation.

Not all of us consider JHK a prophet.  Heck, I calculated that exurbanites could maintain their lifestyle using their lawns.

(I also think he sells himself short as a science fiction writer.)

I wonder on what kind of non-explosive fuel you drive now?
But a roadster?  It will not be a solution to anything - It's a rich man's toy, who cares.  

Think electric Model T.  Big diameter wheels to go better over the crumbling pavement, room to carry the produce to the nearby town on the weekend to make a couple of extra bucks.  Simple materials so it can be repaired by the local blacksmith.

Jay Leno has a 1909 Baker electric that will do 110 miles per charge on flooded lead acid batteries that are serviceable.  It still has the original battery pack.  The weiner batteries of today go about 5 years and die.  Conspiracy?
Warranty duration and competitive pressure.
Re the Global Nuclear Energy Partnership (GNEP)
The United States and its partners would also lease reactor fuel to other countries, which would then return their spent fuel to be reprocessed.
That sounds as reassuring as being connected to a gas pipeline from Russia. While the GNEP idea sounds good the reality is that few countries will want their energy supply influenced by the US. Long term I don't disagree with Lovins who advocates micropower and conservation rather than nukes; it's just too big an ask with the present infrastructure and population.
This is the 5th nuke plan Bush has put out in 5 years. Wall street hasn't bitten on the other 4 and will probably ignore this one.  
Just like with oil it will be a two way addiction. US and Russia will be reliable suppliers because they have strong interest to - uranium enrichment technology is readily available and not that hard for a moderately developed country to build by itself. One disruption in supply and suddenly the West will have to deal with hundreds of Iran-s all over the world.

FWIW the nuclear plant in Kozloduy, Bulgaria and in most East European countries have been operating within such a schema with the Russians for many decades now. It is very convenient because we don't have to worry about waste management etc. - the russians are taking care of this and AFAIK they do it well. You can think of it as corp-to-corp on a larger scale.

I worry much more for Russia stopping us the gas than this one. For the piped gas we don't have any options, while for nuclear we can replace them with France, Canada, Australia or whoever shows to be a more reliable partner.

I used to live in Sacramento and did not have air conditioning. My cooling consisted of lots of tall trees and a squirrel cage fan in the basement. The house wasn't even very well insulated but never got above 80 degrees--- even on 105 degree days. Perhaps it's a little bit warmer now, but I notice that the temps this week are hovering above 100 degrees.  Sacramento is probably cooler than a lot of places at night, which helps, but I still say that if homes were sited and built better, low tech, low energy solutions would go along way to cut the AC load.  Simply adding power to the grid is not the way to go when there are other approaches available.

California has a voluntary program where they automatically cycyle your ac off around peak demand. You get a $25 credit for signing up for this service.  Perhaps they should raise the credit or mandate this throughout the state. I wonder how many people keep their house at 70 degrees while they ar at work.

A shame, and this probably has a lot to do with global warming --- Denver used to be largely AC free, well into the 70s.  Yes, there were always a few days that were uncomfortable, but for most of the summer it was cool enough to get along without ac, especially if your house had plenty of trees and you had, say a screen porch to keep the breezes up.  Now, virtually all new houses have ac and most old houses. This is exacerbated by the prevalence of thousands of new homes and dozen of new subdivisions with the no trees out in the middle of nowhere.  Code is most places is still 4 inches of insulation in the walls.  Go figure.  Insulate first. Increase capacity only when absolutely necessary.


Basement, trees, fan, and an owner who knows how to operate the system. That's a winning combination.
Figuring out where to place the fan, when yo open and close windows, when to turn the fan off and on --- these things are very very hard for those who only know how to crank up the air.
Alright, I give.  How do you use a fan in the basement to cool a house?  

We have a whole-house fan in the center of the main floor ceiling, which does a great job of cooling things off when the night-time temps fall low enough.  But I've never heard of using a fan in the basement to cool the house.  Wouldn't it drastically increase the basement humidity?

That's the problem with my old bank house.  The basement is a moisture trap - the walls stay cool, and the more air you move through there the more moisture you bring in.  It hits those cold walls and dumps all the moisture there.  I've done better this year by keeping it closed up, but I really hate that.  I'd like to put the screen door in it.  My second floor is partly in the bank too, and we've had to resort to the air conditioners there, even though we hate them (even beyond the energy use issue).  I can't see leting books and things get moldy and damaged.  

I need to do some work with drainage on the chance that some of the moisture is coming through the walls from the ground on the other side, but I'm frustrated trying to work out a way to avoid using the A/C.

That's why hygrothermal design is a hot topic right now.  People want tighter houses, but they don't know how to handle the trapped moisture and off-gassing.


Apparently it was a problem 170 years ago too.
I was wondering that too. I will say I have seen non-obvious fan arrangements that were very effective. And both homeowners who did it all by rote, neighborhood custom, family tradition and the ones who figured out something good.
Maybe tstreet will come back and tell us?
Why would it increase basement humidity?
The basic operation is finding a way to move some of the steady 55 degree (Chicago) thermal mass of the basement floor into living area.
One option is to use the fan in an upstairs window blowing OUT, not IN.  That sucks the air from the basement upstairs into the rest of the house.
A fan in the window blowing out at night drawing in the cool air from all open windows...close the windows in the morning before it warms up, and let the thermal mass of the house take care of the rest.
Hey, that's what I do. I have a MASSIVE concrete floor, and I have screen doors that allow the cool air to blow through the house at night. In deserty western Colorado, that really cools the concrete.

My house rarely gets over 75 degrees, even when it's more than 100 degrees outside. No need for air conditioning.

In the winter, I use off-peak wind-generated electricity to heat the radiant concrete at night. It then radiates that heat out during the day.

What I've been wondering is if there were a way to cool the water in the radiant floor. Perhaps some kind of evaporative cooler or heat pump?

Not that I need it. It's so dry here that 75 degrees feels great.

What I've been wondering is if there were a way to cool the water in the radiant floor.

Use a transfer plate and cold water generated via the trapped heat in an ammonia-water cycle.

Real goods will 'sell' you one, the US military has 'em deployed....the technologhy is well known.

"Why would it increase basement humidity?"

Depends on where you live, but I'd say in most places...the air you bring in from outside, or just circulate around from the rest of the house will have a dewpoint which is close enough to objects in the basement such that it will condense on them.  Thusly to continue circulating the air will just keep depositing moisture in the basement.

The fan pushed air through   air ducts. This was just a very small basement, not somewhere you would hang out.  I don't recall having any humidity problems, possibly because Sacramento is very dry anyway.
I suspected this...the low humidity makes all the difference.  We swelter here in high 90s heat, mostly (heat island effect kicks in too) because of the humidity.

To help prevent blackouts, companies cut their power
Program gives monetary rewards to participants

Associated Press

N EW YORK - As the mercury climbed and air conditioners devoured a near-record amount of electricity this week, the operators of New York City's power grid sent out an alert: More juice.

Grocery stores immediately dimmed their lights. Hospitals switched on emergency generators. At one 35-story skyscraper in Times Square, managers darkened the blazing billboards that illuminate Broadway, even during the day.

By 1 p.m. on Tuesday, those efforts had reduced the load on the system by an estimated 650 megawatts -- enough power for about 650,000 homes.

"It gave us the relief we needed in our peak hour," said Ken Klapp, a spokesman for the New York Independent System Operator, which controls the state's power grid.

The dramatic conservation effort was no spontaneous act of altruism.

Under growing programs now in place in several states, grid operators are paying select customers to conserve energy during periods of extreme stress on the system.

Some big users of electricity, like factories and college campuses, can get checks worth tens of thousands of dollars for guaranteeing power savings for a few hours on the few days a year when the grid is stretched to the limit, as it was this week during the heat wave.

Without such programs, power companies might have to cut voltage or resort to rolling blackouts to ease the load on the system.

This year, companies in the New York ISO's "demand response" program -- started in 2001 -- have committed themselves to saving up to 1,470 megawatts in a pinch.

"That's equivalent to the largest power plants in the state," Klapp said.

Demand response programs are not the average homeowner; participants need to prove they can deliver fairly substantial savings.

Specialty companies have emerged to help carry out the program. In five years, Boston-based EnerNOC has signed up about 150 clients, including grocery stores and state universities in California.

From its command centers, the company can monitor and adjust the electrical use of its customers, including dimming lights, adjusting the air conditioning and turning on emergency generators.

When the New York ISO called for a power down on Tuesday, the managers of 750 Seventh Ave. switched off the dazzling electric billboards that hang over the sidewalks on three sides of the building. In 15 minutes, with the help of other adjustments, the building had reduced its power use by 250 kilowatts, enough to run 200 to 250 homes.

"Profit of Doom" has been arguing that the only reason people bother to post about P.O. is because of sex and money.

And you know what? It's TRUE! Now that I've been converted to seeing this new reality, I see that all the above posts, and all the above links are crammed with sex! It's positively pornographic! (Very erotic, very stimulating!)

Thank you Matt, for opening my eyes ;-)

Hi Jim,

I guess you know its more subtle than that.  We have to post, to get noticed, to show what we do and then maybe be allowed to get a girl.  While I think it's gene driven, I dont think that posting on an international website read by only me in the near 100 km away from where I live will bestow me enough bragging rights to get a girl.

I guess thats harder than just posting!  Maybe we have to actually meet girls!

Times change dude!  I know people who have married partners they met through the internet - as fantastic as that seems to a backward troll like me.
Twilight no troll...maybe some day get pretty girl.
Thanks, but I've got mine - not sure how I managed that, but I would never have considered the internet!

The fact that it is a poor strategy does not mean it is not a strategy.

I'm going to be posting here less for exactly this reason. Need to get out there and sow some oats before the world is turned into a total cinder.

In case any interested ladies are reading this, I prefer women who are tall and can run fast. I lack these qualities (5'10" and never faster than 7.2 in the 60 yard dash) and thus need to make up for them so that my offspring are best suited to survive the coming storm.

I posses good physical strength and decent hand eye coordination so you need not have those traits in abundance.

As of yet I have no racial preferences mostly because I
have not yet figured out which racial groups have an edge in the coming race war. Ideally you are of stock from whichever 2-4 groups are most likely to prevail.

To inclusive fitness!



Objective 1 - get re-elected at next election at any cost
Objective 2 - appear green and concerned about CO2 emmissions - build renewable power sources with EROEI as close to 1 as possible
Objective 3 - maximise tax take from energy to fill black hole in the books
Objective 4 - don't at any cost upset voters - so don't increase fuel taxes
Objective 5 - maximise tax take from energy - so introduce windfall tax on the energy producers
Objective 6 - use some of tax raised above to incentivise the energy producers
Objective 7 - use even more of taxes raised above to subsidise public transportation - mainly airport expansions to transport public to holiday destinations in the sun, and roads to transport public to supermarkets to buy strawberries grown in Spain and California
Objective 8 - ensure security of energy supply - invade Iraq
Objective 9 - hide what is really going on by creating international and climate turmoil - lining up events to blame high energy prices on
Objective 10 - take credit for the clever startegy of bringing the sun and Sahara like conditions to the UK (for those of have not heard the English are being fried - in Aberdeen today it is the usual 15C)
Objective 11 - blame energy shortages on the Tories

Has anyone carried out a Hubbert linearisation of Chinese oil production? ASPO had been projecting that Chinese oil production (albeit 'regular' oil) would peak in 2003, but EIA statistics (which aren't always reliable) show Chinese production continuing to increase. I am curious, therefore, as to what the HL technique would suggest is the state with Chinese oil reserves.
A couple of biodiesel stations in the West side of Los Angeles.


I've been waiting for a fresh open thread to mention the following link.


Check out all 6 of the flash movies listed under `classic jibjab' - if you only have the time to watch one go with `2-0-5' as it has the most relevance to current affairs but they are very well done. Very creative humour.

this one:


seems taylor made for "some of the guys " around here ;)

While not effecting the oil industry, here's a picture of hurricane Beryl

I meant to say, tropical storm Beryl!
I have been asked by Norwich University in Vermont to deliver a lecture on energy during next spring's lecture series. I would like some input from the group, as I want the lecture to have maximum impact. Here is the abstract that I have put together:

In the coming years, the world is going to be faced with declining petroleum supplies. What are the prospects for alternative energy sources to fill the gap that will result after oil production peaks? Can we emulate Brazil and farm our way to energy independence? What are the risks of having our fuel supplies compete with our food supplies? Should we turn coal and gas into liquid fuels? I will take a critical look at these questions, and many more surrounding the debate over our future energy supplies.

I have 45 minutes, and I intend to drive Peak Oil home to the audience, as well as debunk some alternative energy myths. Any ideas or suggestions for incorporating into the lecture are appreciated.



Keep us posted when exactly you'll be at Norwich. I'd like to hear you speak and to meet you. (I live near Burlington.)
Actually, if you're interested in the Vermont Peak Oil Network for issues and contacts, you, and any other TOD readers, can checkout the website at


And in fact, Robert, depending on when exactly you'll be coming to Norwich, you are welcome to stay with my mife and me outside of Burlington, either the night before or after. I teach at a local college, and we have homesteaded outside of Burlington since the mid-'70s. I can't say I had heard of Hubbert's Peak back then, but we both understood exponential growth (my wife is a mathematician) and we both knew that fossil fuels are finite.

All best,


Thank you for the offer. I was told the most likely time would be in April. It has been years since I have been to Vermont, and I am looking forward to the trip to one of my top 5 favorite states.  

The professor who invited me asked me to talk about my graduate school research, and the abstract I sent is a bit broader than that (although I did discuss Peak Oil in my 1995 thesis). If I get agreement on the proposed abstract, the date should eventually be posted here. What I wish to avoid is the dull, dry scientific lecture that I frequently attended in grad school. I want to have them on the edge of their seats, and I want them to tell people about what they heard.

I will keep you updated, and hope to at least meet you when I am there.



  1. Begin with humor
  2. State your main point immediately thereafter and about three more times.
  3. Leave twenty minutes for questions
  4. Consider a neat little demonstration, such as opening a bottle of Everclear and pouring an ounce into a little model airplane propeller engine (or mini diesel or 22 c.c. bicycle-assist motor). You fire up the engine, make it roar, then let it cool and pass it around. (Caution: Do not drink the Everclear, even diluted. As an alcoholic beverage, it makes great grain alcohol.)
Begin with humor

How's this? I will open with:

"You are all going to die!"

Pause for effect.

"Just kidding. Some of you will survive, albeit in less comfort than you now enjoy."

That should have them rolling in the aisles. ;-)



Of course we are all going to die.  How about adding within the next 10 years.  Pause.  Continue.  I imagine this would impact anyone under the age of 70.
He's talking to Norwich students, and those are kids who can seriously make themselves useful in the coming years.

Based on your abstract all solutions are supply side.

How about addressing the need for engineered solutions that reduce the consumption side of the equation simultaneously?

Then your abstract could also say "What alternative energy strategies are viable for maintaining supply and demand after oil production peaks."

If we stop trying to fill the energy gap post peak would this alter which energy forms we pursue?  If we overly focus on transportation fuel delivery do we miss major opportunities in other areas?  What are the losses if we try to convert everything to liquid energy vs increasing electricity from direct burning?  We seem to be highly dependant on liquid fuels now, do we have to be in the future?

Just some thoughts.  Congratulations on the invite to speak and educate people.

"What alternative energy and conservation strategies are viable for maintaining supply and demand after oil production peaks."
In response to both you and NC above, conservation and efficiency will be major themes. Once I take them through the fact that alternatives can't fill the gap, the conclusion is that conservation, or something much worse, will have to.



RR.  This may be too strong for most, but the fact is that we are doing way too much trashing of the planet for nothing actually worth anything.  I cite as obvious examples the huge lighted billboards remarked on above, as well as a high percentage of the junk we all see in the big box stores.  I again quote Kenneth Boulding's famous definition of an engineer (me) as one who spends his time striving to think up the best way to do things that  should never have been done at all.

I give  talks to local clubs and I bring with me a random assortment of crap from any store, as well as a few photos of frogs, herons and other friends that we are trading for the crap.  Don't know if this works, but I do see  puzzled frowns, suggesting "never thought of that".

Anyhow, good luck and don't get discouraged.

This makes me think of the sites that spend thousands of hours discussing the latest and greatest in incremental improvements leading us to the perfect automobile, while all the while we are contining to buy and drive SUVs and trucks.  Ultimately, the auto should be restricted to very special uses where there is simply nothing that will substitute.  Electric,PHEV, ethanol driven, hydrogen, or whatever, we just need to get them off the roads, starting with our cities.
If the reaction to your lecture is similar to the reaction Robert Hirsch got at Duke, there are going to be some very sober faces when you are done. Most of these kids don't have a clue. I would echo the suggestion that you include conservation strategies. Good luck with this.
Maybe you need a warning slide up front:
Adult Content
You may experience discomfort from what you are about to see and hear.

PO is near.

Parental Discretion Advised


WARNING - If you are skilled at cognitive dissonance, you may want to begin now.

Point the students here, so they can find out more. At my university they set up a (small) facebook group to use for discussion afterwards too, might want to suggest it.
While it's good to explain the supply side as thoroughly as possible, don't neglect to mention that there are many ways to eliminate waste and improve efficiency.

It's hard to predict how fast alternatives will be ramped up.  It's hard to predict how fast conventional sources will decline.  Our success at conservation will determine to a large degree how comfortably we can deal with supply difficulties.

You are doing this in Vermont and in six months, after this winter.  Seems to me that things might change.  And you have a lot of people ahead of you.  McKibben et al, local towns talking about forming local munis and community investment trusts for alternative energy.  They know they need to own it, they know it needs to be local, they know they have to conserve.  There is no way you can plan now what you will be saying.

You are talking to students, the very same generation(s) we are ripping off.  Not only energy, but every natural resource.  And we'll leave them with our debt and a toxic body burden.  When I talk to students [two doors over in Maine], a large chunk of them understand that dynamic all too well.  I love to ask them "when will the airlines shut down".

post peak oil pump



Just one aspect that I would like to mention. Your posts are very informative and hence you may already be aware of it though.

In all the talk about bio-fuels, I havent come across them talking about the fact that you cannot go on harvesting from the soil forever. People say switchgrass is free....but if you harvest it continuously for more than a certain number of cycles then the soil doesnt have the organic material to regenerate and then you have the microbe populations etc suffering. Of course, the "One Straw Revolution " scientist says that the soil gives only about 5% of the nutrients required...the rest of it comes from the air.


Forgot to mention that we have to take it as a given, that we are going to be facing increasing shortages of fertilizers, so we have to turn to returning as much of unused bionmass to the soil if we want the soil to be healthy so that we can feed ourselves.
You are absolutely correct, and I have mentioned before that soil-mining always gets a free pass in the ethanol debate. Other free passes are frequently issued for herbicides and pesticides that end up in streams and rivers.



Horse manure.
Pig manure.
Cow pats which are the feminine form of B.S.

Many areas have been intensive cultivated for 5,000 years without damaging topsoil or much of anything else.

Please read some history.


Nobody is saying that it hasn't been done, nor that it can't be done. But it isn't being done, which is why our topsoil is depleting. That is a fact. Erosion is reducing the thickness of the topsoil. If our farming practices were sustainable, that would not be the case. And to make them sustainable would mean reducing the scale of the operation, which would reduce the amount of ethanol we could produce. It's a vicious cycle.



Hope there are some shrooms under all that manure.
A Stratfor.com guy on Fox News last night predicted a full scale Israeli invasion.

Drudge:  Israel Hints at a Full-scale Invasion

Maybe true westexas, but I gave up on stratfor a couple of years ago when they predicted the Russians would soon arrive to save the Americans from the insurgency ...
And don't forget, they've been predicting the imminent collapse of China for years now.  Every year it's a different reason.  I think the last time they said it would be bad loans.  China was supposed to collapse before the 4th quarter of 2005, thereby driving oil prices back down to $30/barrel.  Just in time for Christmas...
They may be right this time though, and they are not the only ones predicting it.  The present Israeli strategy has not been overly effective, and they cannot walk away from it that way.    Doesn't leave a lot of choices, really.
Israel has threatened full scale invasion before.  But it's just talk. The MSM is covering this tragedy like they're announcing at a football match and the Israelis are suggesting it for effect.

Well, I'm not one to know for sure, but at least that's what Robert Fisk said when interviewed on Democracy Now! on Wednesday from his home in Beirut, and as he's as senior a war correspondent as you can get and a Lebanese resident, I'll take his word for it.

Fisk is the same guy who was so impressed with Iraqi civil defense measures in 2003 that he predicted the US army would never reach Baghdad. Fisk is a twit.
Fisk is no twit.  He's not always right, but he's over there and not afraid to get in the middle of it to find out what is happening.  In this case, because he lives in Beirut his reports are at once interesting, and maybe a little colored.  He seems to see this as mostly Syria's doing.
Israel massing troops on Lebanese border, from Associated Press, July 21. There may be no fulls cale invasion yet but it's sure starting to look like there will be one.
We're saved.  ;-)

Spanish firm claims it can make oil from plankton

A Spanish company claimed on Thursday to have developed a method of breeding plankton and turning the marine plants into oil, providing a potentially inexhaustible source of clean fuel.

Vehicle tests are some time away because the company, Bio Fuel Systems, has not yet tried refining the dark green coloured crude oil phytoplankton turn into, a spokesman said.

But... but... but...  Oil is abiotic, right???


This is off-topic, but I am simply stunned that anyone in Indonesia would hesitate to issue a tsunami warning.

Later it was reported that the warning about any possible tsunami actually came to be known by the Minister of Research and Technology, Kusmayanto Kadiman, through an SMS from the Japanese Meteorological Department 20 minutes before the actual tsunami hit the beach of Pangandaran, Cilacap and its neighboring areas. He even received similar warning from the Pacific Tsunami Warning Center in Hawaii. But he did not inform anyone about this information and instead only reveal about the SMS after the tragedy struck. No official warning about this tsunami. The government knew about the danger but they did not announce it.

Answering reporters' questions as to why no warning was issued on Monday, Vice President Jusuf Kalla claimed there was no need because most people had fled inland after the earthquake, fearing a tsunami. However, of dozens of people interviewed by The Associated Press in Pangandaran on Tuesday, only one person said he felt a slight tremor. None said there was a mass movement of people to higher ground before the tsunami, though some residents recognized the danger when they saw the wall of water approaching.


Kusmayanto Kadiman, the minister of science and technology, said in Jakarta that Indonesia had received the bulletins 45 minutes before the tsunami hit but that officials had not announced them to avoid causing unnecessary alarm, The Associated Press reported him as saying.


Soon after the initial earthquake, which caused tremors both on Java and underwater, the Pacific Tsunami Warning Center (PTWC) in Hawaii warned Indonesia of a possible tsunami wave. But Indonesian officials, who received detection equipment and technical assistance after the 2004 Aceh disaster, were unable to put the technology to timely use.

Surono, an official of the Meteorology and Geophysics department, said the tsunami detector was not functioning when the killer waves struck. He said one reason for the government's inadequate response was a strong belief among scientists that Java's south coast was a tsunami-free region. "Our predictions were wrong," said Surono.

Kusmayanto Kadiman, minister for science and technology, said the government did not react to the PTWC's alert because it wanted to avoid creating panic and alarm.

"Had the tsunami not occurred, what would have happened?" he asked while speaking to reporters in Jakarta.


I guess we'd better get used to lame excuses.

Well, there you have it: "we didn't want to stampede the herd."  I love this--it seems to work in just about any situation.  New Orleans--"well, we just didn't want to alarm anyone." Peak Oil--"we thought it would cause a panic."  Global warming--"too scary to talk about, ignore it, we thought it would go away."  Gotta hand it to these officials...
Nymex Oil Futures are down to $72.20. Is anyone else depressed :-)
Contract expires tomorrow, I think.  The speculators are bailing out.  
I just saw the Nymex Crude Oil contract at $75, up $0.23. I had bought earlier this morning and sold for quick profit.
Hmm, Bloomberg.com has it at $73 even when you're reporting $75. But that's probably due to the 30-minute delay on their Web site.
Sorry, I was looking at September Crude Oil. I think you were talking about August contract. September has pulled back to $74, for some reason. Glad I sold.
CW2, you stuck a smiley face on the end of your post - I'm still trying to suss American humour.  I see a potential paradox among contributors to TOD - or is it that TOD is the ultimate PO hedge?  I get the feeling everyone is topped up with oil stocks and oil futures.  Gold is also having a rough few days.  U has been the most stable beacon this year.
Gold = buy on the dips.
I did.
Oil stocks and futures? Well, if the world is coming to an end, maybe I can make a couple of bucks. *LOL*
Not all of us!  Even if I had the extra cash, I'dprobably spend it on trying to get better prepared, or on equipment for the business I'm planning.  There is certainly a large investor group here, but not everyone by any means.
I invest every penny I can in my college student daughter. Only gold we have is the wife's wedding ring. Stocks? Don't they race on Saturday night. Bonds? some sort of sex toy, I reckon. Futures? Owe too many Pasts. Tried playing in the market but the manager chased me out.
I put every nickel I had into education of my four children, including three mortgages on the house and borrowing on my signature at interest rates of 29%.

Best investment I ever made. My four kids are successful, not only financially but in other ways too--due in no small measure to their having the best educations they desired. And being children of mine, the best was none too good.

As a single parent, there were times when I had no bed to sleep on, and I redarned socks that fell apart. The divorce lawyer told me to go therough bankruptcy, but I told him to go to a warmer climate. Now I'm out of debt and my children's student loans are paid down to small amounts. I have assets now and way more income than I need. I "need" very little--enough for rice, beans, fish that I catch and game that I trap, plus warm clothes purchased at Goodwill.

Now I spend on luxuries unimaginable to me twenty years ago such as buying a post-hole digger rather than borrowing one from a neighbor or buying organic whole wheat flour instead of the cheap white stuff on coupon special.

You've been through tough times, but with help from friends and family and your marvelous daughter, they will get better.

Hang in there and keep posting.

Ah! The old Russian connection. Coupled with the report that CERA's largest client is SA it all begins to make more sense.
As my Pappy used to say " Where you stand depends on where you sit."
Your e-mails: Fueling America

CNN.com asked users for their ideas on the best way to fuel America and break the country's dependence on fossil fuels, especially from foreign sources. Here is a sampling of the responses...

Not bad, really.  Many of the e-mails they picked seem to have some grasp of the problem.

Like this one:

Do American policy makers and politicians realize that since 1966, we have added 100 million people to the U.S. -- all energy consumers? If the Senate amnesty bill becomes law, we can expect (to add) 60 million to over 100 million people to the U.S. -- all energy consumers -- just over the next 20 years! We must cut domestic consumption and develop alternative sources of energy. But what progress can we achieve if we cut consumption by half while we allow the U.S. population to double? There are no alternative sources of energy that can cope with unlimited population growth! Therefore, any real solution to our energy problems must be accompanied by serious measures to curb legal and illegal immigration, the driving force behind the U.S. population growth.
IMO this poster has an excellent grasp of the


Of course, if we believe that oil is  fungible, then no matter where these people are, they are still going to want to consume OUR OIL!!, given that oil is a world traveling commodity, meaning that the problem is not solved at all, right?

Solving it could be a bit challenging on a practical basis, by the way, given that the Communists were willing to shoot on sight people who tried to cross the Iron Curtain, and yet during the Cold War, you ran across as many Poles, East Germans, Romanians and Yugoslovians as you did Mexicans.

It is astounding.  People laugh at technology and then want to cure the Peak oil problem by immigration control!!  :-O

"Peak Oil is not the danger.  The danger is in doing something really stupid in reaction to it."

Roger Conner  known to you as  ThatsItImout

The ground is shifting under Ford Motor. Again. And it is unclear--seemingly even to executives--how the company is going to get its footing.

Only six months into the automaker's second restructuring plan in four years, Ford is already working to overhaul it. Sales of the company's high-profit trucks and sport utility vehicles have slid faster than Ford expected.

... Ford is "trying to figure out just what's happening in this industry," said Chairman and Chief Executive Bill Ford ...

But, they're still not getting it.

Ford is very excited about a pair of crossover vehicles slated to debut later this year, SUVs built on car chassis called the Ford Edge and the Lincoln MKX. The Lincoln is particularly sharp, and Fields says of the Edge, "We think we will have the definitive crossover in that segment."

http://tinyurl.com/jw6cw (Forbes)

Ford will fail...GM will follow.
Hello Tate423,

I agree and Honda, Suzuki, Yamaha, Kawasaki, Harley-Davidson, Piaggio, and other motorcycle, ATV, and scooter manufacturers are already experiencing spectacular growth.

I long ago emailed GMC asking them to import the Tornado pickup that they make for Mexico, but I think they are afraid of cannibalizing their profitable sales of big pickups.  Sadly, even Toyota's Tacoma pickup has gotten larger over the years, but GMC refuses to make the move to grab this small truck market share first.  Pure stupidity on their part, IMO.

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

That really looks like the Subaru Brat. It came with 2 seats in the bed to benefit from avoiding import tariffs.
Hello RG144,

Thxs for responding.  Yeah, it does kinda resemble the Brat, but I think it is even smaller.  Much more modern design, reminds me of a shrunken Honda Ridgeline pickup or the older El Caminos or Ford Rancheros [bed & body one piece vs. distinct bed like a regular pickup].  I see these running all over Mexico--I want to buy a used one, but it would cost a fortune to get it equipped to pass American Specs!

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

The Tacoma plumped up impressively.  It's the natural progression of car lines, though.  That they become bigger and bigger and are eventually phased out and replaced, beginning the process anew.  Such is the direction of Honda's Civic line which has become the size of the old Accords, and the Accords are full size now.  The Fit is set to fill the void the old smaller civic left.
In Japan, the Fit is a mid-size car!  I drive a 3-cylinder 660-cc 4-speed sub(-sub)-compact, the likes of which you could never drive in the US because the speed limits are higher and there's more distance to cover.


Now, supe that baby up with an electric motor and watch it FLY!

I read an article a few days ago about brunswick boats.  I didn't know they made boats, but they do, and their boat sales are tanking.  Sales are off by as much as 46% YoY.  That's not too good.  The article even went on to say that people are driving to their boats at the dock, and having get togethers around their boats since they don't want to pay to fill them.

I had a crotch rocket for awhile.  Bought it brand new. I coasted everywhere at about 80mph.  That was the natural speed of the bike and I still got 40-45mpg.  I want another, but I fear there will be little room for one in my future.

I know where you can get for $3,000 a clone of the bike Tom Cruise rode in "Top Gun." It will do an honest 211 m.p.h.

Please do not ask me how I know that. I can even outrun the Highway Patrol planes . . . . :-)

There are some stories to be made when riding these motorbikes!  Long story made REAL short.  After a 2-3 night ride we (10-12 of us) jumped on the highway but the onramp was banked weird and turned from right to left midway through.  Guy in front of me dropped his brand new bike, totalled!  We split up and he was ok.  My group breaks down into two smaller groups going in two directions.  

Brand new R1 was leading and this guy was doing wheelies & landed on the back of a car!  Car turned out to be highway patrol and yes they chased him.  No there was no way in hell they caught him, but they did catch my other two friends hanging in the back watching all this.  They were screwed with and one had a court no show, so he was promptly arrested and his bike impounded etc.  What fun times on crotch rockets!

It is time for them to go, they are no longer relevant.  The problem is all the people who depend on them for income.  All those years of listening to the bitching about the unions, and how they destroyed the companies.  But look at the wonderful decisions made by the genius managers.  It is not the fault of the people who bolt them together, nor even the people who design them - the product decisions are made by the same overpaid morons who've hollowed out all such industries from th inside.  Sad thing is, if you turned the people at GM and Ford who actually do something loose on designing a viable vehicle, I'll bet they could do a bang-up job.  

But it won't happen - the fish rots from the head, but even so the rotten head will be the last part to go.

From what I read, they did turn a team loose to design the EV-1.  There's something of a backlash against the movie, Who Killed the Electric Car?  Commenters on imdb and other sites are claiming to have inside knowledge that the car was seriously flawed.

My impression is that it was expensive, like the Tango and Tesla, but it was a pretty good early effort.

BTW, I just saw a commercial that VW is bringing the Rabbit back for about $15K, so I checked out the website.  The EPA rating is only 22/30 mpg!  I would swear that my 1981 Rabbit Convertible did better than that.


Probably - buy our expectations of what a car should be have changed a lot in the last 25yrs.  From a size and feature point of view, a KIA Rio5 or a Hyundai Accent (30/36mpg) are a lot closer to your 1981 Rabbit than anything VW is likely to produce now - just a whole lot better put together.  
You're probably talking about the gas version, but...

"The VW Rabbit was the replacement for the Beetle in the US market. The Rabbit never really caught on until around 1979, when the oil crisis was at full force. The little Rabbit, combined with the optional 1.5l 4 cylinder Diesel delivered superb fuel economy (45 mpg city/up to 57 mpg highway")

Yes, many diesel rabbits were made in nearby PA, but the convertible was German-made and gasoline-powered. But I think I got in the high 30s on the highway.

It was a fun car, and went 150,000 miles, but I was car-poor for quite a while. If I had it to do over, I would have gotten a diesel Rabbit or Jetta with a sunroof for half the price.  

The Atlanta Journal Constitution article "Saudia Arabia's Oil a Huge Question" (quoted above) is a peak oil article in the main stream media. It makes a number of good points about declining Saudi Arabia production and the possibility of peak oil. Articles like this can be very helpful to getting the word out about peak oil. We need to get the word out about this article, any way we can - personal e-mails, web site links, Digg, Reddit, etc.  

Stuart's SA production/rig count chart, linked above, has more than one possible explanation. The facts are not in dispute - the number of rigs drilling for oil is up 144% since November, 2004 while output is down 6% over the past three months.  Here is the tale I would tell...

In April, 2004, and following a ragged decline in the Kingdom's output that began from a peak the year before, the young hands (TYH) realized that overall field declines could not be compensated by the number of rigs working in the Kingdom.  So, with some temerity, they requested a meeting with His Almost Excellency (HAE), ARAMCO's No. 2.  In due course the meeting was held in HAE's cavernous office.
    After the usual lengthy salutations, TYH produced their charts and data.  HAE carelessly waived it all away, with the following instructions: "First, we must maintain the Kingdom's credibility, and there have been some questions.  We must increase output to support His Excellency's trip to Geneva next month, where we will reassure the markets.  However, I recognize you do have some technical difficulties; you may seek advice from The Wise Old Hand" (TWOH.)  
A quiet murmur spread among TYH - TWOH was legendary; it was said he made all important decisions regarding the Kingdom's oil development from the time the infidels were kicked out a generation earlier up to his retirement in 2000. None of them had ever even seen him - he had been a hermit even before he retired.  Meeting with TWOH would be something they could tell their grandchildren about.

In due course TYH met with TWOH, crowding into his modest living room at his Spartan residence in a quiet, middle-class neighborhood in Jeddah, close to the Red Sea.  This time, salutations were brief and their charts were carefully examined.  TWOH began, "the solution is simple; add a stream from the tank farms", when he was interrupted by one of TYH.  "We must save this reserve for dire emergency, such as when Saddam invaded Kuwait!", at which TWOH thundered, "let me finish!"
Beginning again, and this time without interruption, TWOH described his plan:  "We are now facing around 10% overall annual field decline, and our 18 rigs drilling new holes can only compensate for a decline of 6%.  So, we need 36 rigs to allow a 2% yoy increase, or 54 for an 8% annual increase.  I propose we triple the number of rigs but meanwhile drain the tank farms to allow us to meet the Kingdom's commitments.  We will be able to stop draining the farms before we get to 36 rigs, and will be able to rapidly refill the farms when we get to 54.  Do the math - we just need a few more rigs."

And so it was done. Of course, draining the farms was almost instantaneous, so by June, 2004 production was at 9.5mmb/d, where it stayed.  New rigs took longer; first, the vaunted SA bureaucracy, including most of its ministries as well as the Crown Prince and his advisors, had to approve a) the request and b) the funding, get bids, have the rigs transferred, etc, but by December, 2005 the first arrived.  Indeed, by March, 2006, the number had climbed to 42.  However, at this point the farms had drained and were no longer able to add to production, and meanwhile production continued to decline in spite of the new rigs.  TYH again requested a meeting with (the new) HAE.
Salutations were briefer, less complimentary.  TYH' spokesman said, "we now have 42 rigs, but output is once again declining at over 10%/year.  We need to consult with TWOH again."  HAE replied, "sadly for us all, TWOH is in paradise.  I will advise His Excellency to issue a statement explaining that we have no buyers for some of our heavy oil.  Meanwhile, we must continue TWOH's plan.  I will authorize more rigs until production stabilizes and we can refill the farms.  We just need a few more rigs."  Quietly, in a nervous refrain, TYH echoed, "we just need a few more rigs."

Note - for this tale to fully explain the chart, SA must have had around 400mmb in their tank farms, or 45 days of their production, and the number I heard from somewhere is 100mmb.