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malco

Have We Reached "peak Oil"

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A researcher has posted this graph of global oil production at The Oil Drum:

http://www.theoildrum.com/story/2005/12/22/41839/374#more

It appears to show that global oil production reached a peak in 2005 and may roll over next year. If this is so, then Ken Deffeyes' slightly tongue-in-cheek prediction of Thanksgiving 2005 for Peak Oil may turn our to be pretty accurate.

As one respondent comments, we really need to watch how the data lines develop during 2006 before we can reach real conclusions. I'd advise you to keep an eye on this over the next year. The earlier you get the bad news the more time you have to make preparations before most other folk know what is going on.

IEA_EIA.gif

post-2472-1135545435_thumb.jpg

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I dare say the US has a handle on this one and fully suspect they intend to use up everyone elses before they deplete their own stocks.

I do think we have reached peak myself, China is on the grow now as is India and their populations are going to become increasingly ever more reliant on oil. Historically energy and its abundant supply is the catalyst for economic growth, its how we arrived at our juncture and I am sure the same will be said of the emerging economies, however the supply is going to be squeezed so I do fully expect Iran to be the bad boy this year and get a spanking.

No doubt we will hear stories of School Buses,Ice Cream Vans, and Nuclear Scientists disguised as lolipop ladies being used to manufacture WMD's in Iran. :D

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I don't think we are quite at the peak yet, but I think we're close.

Consider that the Gulf hurricanes and other supply problems may have caused price spikes, but there were no actual availability problems.

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In my view the Nation that pre-empts the forthcoming energy crisis and makes moves to build real scaleable renewable energy resources is going to be the man in front for the middle of this century.

I'm afraid its going to be every man for himself when the worlds oil reserves finally run out.

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After the damage to production facilities in the Gulf of Mexico (GOM) the world could no longer produce oil (all liquids not just conventional crude oil) at the total rate that it had done so immediately prior to the hurricanes. Accordingly this did represent a "peaking" of oil production TO DATE immediately prior to the hurricanes. This is fact.

The question is whether or not recovery in the GOM plus happenings throughout the rest of the world's oil industry will lead to a new, higher peak at some point in the future. That is an unknown at this stage although my expectation is that the final peak has yet to be reached although in terms of both timing and actual production volumes I think we are very close.

Prior to the hurricanes I was predicting global peak in the 3rd quarter of 2007. This is just 18 to 21 months away. I haven't had time to update the calculations (and I likely won't have time for a few months at least) but my best quess is that, since the GOM was one of the regions with rising producton, the effect will be to lower the level of the absolute peak by a small amount. The impact on timing is harder to determine at this stage although any movement is likely to be a matter of months or at most a year or two.

Overall I see the situation as being a bit like going to your local mass market New Year's Eve celebration place where people of all ages gather but not having a watch. There's thousands of people everywhere and plenty of noise. They let of a couple of fireworks just to test that everything was ready to go but it's not midnight yet. But it's close, VERY close given that there are 8760 hours in a year and only one or two of them left. For all intents and purposes the year is over and there is no realistic chance that the overall outcome of the year will change now (unless there's an earthquake etc). You can't lose more weight than you did. A couple more laps of the place isn't going to do much for your fitness. You could finally quit smoking but going an hour until midnight without a cigarette hardly counts as quitting this year. You don't know what time it is but it's over nonetheless. Even now on the 26th of December the year 2005 is basically over for practical purposes.

I see the situation with oil as being very similar. We're not sure exactly when the peak will occur but it's likely to be so close that there's little point in debating it. Either it's here now or it's about to be so now is the time to put plans into action.

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I suspect you are all way off target.

There has been little incentive for exploration, to produce oil or invest fresh money in new refining capacity as prices have been relatively poor. Lead times involved with exploration, production and refining are rather long, so we will have to wait quite some time before we see how things unravel.

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I suspect you are all way off target.

There has been little incentive for exploration, to produce oil or invest fresh money in new refining capacity as prices have been relatively poor. Lead times involved with exploration, production and refining are rather long, so we will have to wait quite some time before we see how things unravel.

The idea that higher prices ultimately lead to increased production has been disproven most famously in the USA in the 1970's where soaring prices were followed by a drilling boom (as expected) and LOWER production (as expected only by those who understand how oil fields deplete).

In any event, the argument is somewhat academic since there simply aren't enough drilling rigs to increase the rate of exploration, most of the existing rigs are old and there's little going on to increase their number. So an exploration boom beyond present levels is out of the question until there is a major increase in rig numbers worldwide. So perhaps another decade before we even START the exploration boom and then many more years before it leads to meaningful production even if the oil is there. Meanwhile, car numbers in China etc. continue soar.

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I suspect you are all way off target.

There has been little incentive for exploration, to produce oil or invest fresh money in new refining capacity as prices have been relatively poor. Lead times involved with exploration, production and refining are rather long, so we will have to wait quite some time before we see how things unravel.

The lack of effort in exploration can be read various ways. Prices have been high compared to what they were in the boom years of oil exploration 1920-70. In 1920s Texas oil was virtually free by today's standards, but that didn't stop them perforating the landscape to get at it.

The long decline in oil discoveries since the late 1960s has been largely unaffected by variations in the price. That is, yes there were the North Sea discoveries etc but in the general scale of things they were not especially large - and because they were expensive to develop they were sucked out on a quick return regime. Now most of those provinces are in decline.

You can't find what isn't there. The lack of investment in exploration and refining could equally be a conclusion by the oil companies that there is no point in spending a fortune on something you no longer need.

We'll just have to keep an eye on the situation.

I am surprised by the lack of interest in Peak Oil on a forum devoted to HPC. If there is a sharp rise in oil prices I think you can take it there will also be an HPC. Can't you see the connection?

Edited by malco

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I suspect you are all way off target.

There has been little incentive for exploration, to produce oil or invest fresh money in new refining capacity as prices have been relatively poor. Lead times involved with exploration, production and refining are rather long, so we will have to wait quite some time before we see how things unravel.

It's this sort of ill-informed comment, based on nothing but bar-room nonsense, that is going to be one of the key problems with this issue.

You really need to do a bit of primary-school level reading about this before you go posting this sort of tosh. If you know anything about the oil situation, you will know that there are practically no regions of the Earth left which hold much promise of any significant oil finds, you will know that discovery has followed a very predictable curve, and that we are now almost certainly at the peak, and so near it that it makes no difference.

Getting oil out the ground is hard. Very hard. Get rid of your cartoon image of sticking a spade in the ground and watching a plume of oil shoot up into the air. Read round the subject. You will learn that we are in deep trouble.

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It's this sort of ill-informed comment, based on nothing but bar-room nonsense, that is going to be one of the key problems with this issue.

You really need to do a bit of primary-school level reading about this before you go posting this sort of tosh. If you know anything about the oil situation, you will know that there are practically no regions of the Earth left which hold much promise of any significant oil finds, you will know that discovery has followed a very predictable curve, and that we are now almost certainly at the peak, and so near it that it makes no difference.

Getting oil out the ground is hard. Very hard. Get rid of your cartoon image of sticking a spade in the ground and watching a plume of oil shoot up into the air. Read round the subject. You will learn that we are in deep trouble.

LP, are you not being a little hard on the guy? After all, he's only regurgitating the VI pabulum that's in most of the mainstream media. The recent Newsnight Special was a significant exception, but a lonely one.

You are correct, of course, that DK should do a bit of homework. And you are right that the "there there, they'll find more oil and we'll all live happily ever after" will be a big problem, not least because I suspect the political class will go for that just to buy time (to the next election!).

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Guest Bart of Darkness
You really need to do a bit of primary-school level reading about this before you go posting this sort of tosh. If you know anything about the oil situation, you will know that there are practically no regions of the Earth left which hold much promise of any significant oil finds, you will know that discovery has followed a very predictable curve, and that we are now almost certainly at the peak, and so near it that it makes no difference.

Wasn't Antarctica mentioned as a possible source of oil at one point? Has anybody ever done any surveys there to see what might be available?

The problems with mining in Antarctica I would suspect include:

The sheer cost of getting at any oil or other resources there.

International treaties prohibiting exploitation of the area (although I'm sure the US would happily ignore these)

Would only put off the problem for a while.

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Consider that the Gulf hurricanes and other supply problems may have caused price spikes, but there were no actual availability problems.

That's because the IEA have been releasing anything up to 2mbpd since then! We haven't been in a steady state situation since the hurricanes, the drawdown on reserves can't last much longer and then an attempt will need to be made to replace them. Today's price and availability is not an accurate reflection of oil extraction and oil consumption.

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There was a good program on the wireless the other day about the oil shale (?) in Canada, there is enough to supply the worlds demand for oil for the next few hundered years or something like that. Not cheap to exploit but now worth while. Dont know how that will affect things.

I was a doodlebugger in the middle east / far north myself for a spell. For Western Geo. Three happy years shagging exotic prostitutes, sampling unusual drugs and ignoring ancient cultures. Happy days.

Edited by jellybean

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There was a good program on the wireless the other day about the oil shale (?) in Canada, there is enough to supply the worlds demand for oil for the next few hundered years or something like that. Not cheap to exploit but now worth while. Dont know how that will affect things.

This is a misleading statement. There may be a large amount of hydrocarbons (it isn’t oil!) but the rate of extraction/production of oil from the reserve is far to slow to make a significant impact on depletion. The problem we face is one of flow rates and unconventional deposits don't help in that area.

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It's this sort of ill-informed comment, based on nothing but bar-room nonsense, that is going to be one of the key problems with this issue.

You really need to do a bit of primary-school level reading about this before you go posting this sort of tosh. If you know anything about the oil situation, you will know that there are practically no regions of the Earth left which hold much promise of any significant oil finds, you will know that discovery has followed a very predictable curve, and that we are now almost certainly at the peak, and so near it that it makes no difference.

Getting oil out the ground is hard. Very hard. Get rid of your cartoon image of sticking a spade in the ground and watching a plume of oil shoot up into the air. Read round the subject. You will learn that we are in deep trouble.

And you're an oil expert or perhaps a geologist?

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The problems with mining in Antarctica I would suspect include:

The sheer cost of getting at any oil or other resources there.

International treaties prohibiting exploitation of the area (although I'm sure the US would happily ignore these)

Would only put off the problem for a while.

what about polar bears ?

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My opinions:

Canadian tar sands: Realistically a peak production rate in the order of 6.5 to 10 million barrels per day with accelerated development and assuming only incremental technology improvements. The higher end of that range implies using a non-oil or gas energy source (presumably nuclear) to power the production process which is particularly energy intensive. It also implies selling the product as extra heavy oil rather than medium/light which means that refineries processing it will require major upgrades.

Antarctica: Probably does contain oil. All the other major continents do so why wouldn't it? I can't see any serious move to explore until the international oil situation becomes truly desperate though so it will be several decades before there's any production. As to the volume, it would be dangerous to make assumptions given the lack of exploration but if I had to guess then I would be expecting somewhere between 10 and 200 billion barrels just based on the physical size of the area and assuming that the conditions found in the Middle East are unique to that area and don't occur in Antarctica. [/b]It's quite possible that there is no significant oil there at all though. Even if there is 200 billion barrels that only buys a few years from a big picture perspective...

Venezuela: An overlooked bitumen resource which is in fact the largest economically recoverable liquid hydrocarbon resource known to exist in any country. I expect lots of political strife in Venezuela for this reason. If it were aggressively developed then peak production in the order of 7.5 million barrels per day is my best guess. I can't see it happening though given the political strife and even if it does, it will take decades to happen and cost a fortune given the need for expensive upgrading plants and the practical realities of bitumen extraction.

Shale: As a feedstock for petrochemicals I think it is viable, albeit polluting and expensive. Some use of it will probably happen eventually and this might include for the production of aviation fuels. But as an energy source for cars, buses etc. it seems unlikely given the extraordinarily high environmental impacts, production problems and costs.

Liquid fuels from gas: Short term measure only. It will happen but not on a large enough scale to solve the oil problem and it simply accelerates the depletion of gas. It's mainly a way to commercialise otherwise stranded gas reserves rather than a real solution to the energy problem although it will produce some liquid fuels so it's a help.

Oil from coal: The most serious contender in my opinion but there will be a shock to the system during the period between conventional oil supplies becoming inadequate and sufficient liquid fuels being produced from coal. There are limits to the industry both due to coal resources and the environment though so it doesn't enable unconstrained growth in fuel use but it ought to keep the ambulances, tractors etc. running.

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There was a good program on the wireless the other day about the oil shale (?) in Canada, there is enough to supply the worlds demand for oil for the next few hundered years or something like that. Not cheap to exploit but now worth while. Dont know how that will affect things.

I was a doodlebugger in the middle east / far north myself for a spell. For Western Geo. Three happy years shagging exotic prostitutes, sampling unusual drugs and ignoring ancient cultures. Happy days.

Not happy days for the prostitutes.

Grow up.

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Guest Bart of Darkness

what about polar bears ?

A handy local source of meat for the McDonalds and BurgerKing franchises. Saves a fortune on shipping costs.

Those oil guys gotta eat!

Kentucky Fried Penguin anyone?

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It's this sort of ill-informed comment, based on nothing but bar-room nonsense, that is going to be one of the key problems with this issue.

You really need to do a bit of primary-school level reading about this before you go posting this sort of tosh. If you know anything about the oil situation, you will know that there are practically no regions of the Earth left which hold much promise of any significant oil finds, you will know that discovery has followed a very predictable curve, and that we are now almost certainly at the peak, and so near it that it makes no difference.

Getting oil out the ground is hard. Very hard. Get rid of your cartoon image of sticking a spade in the ground and watching a plume of oil shoot up into the air. Read round the subject. You will learn that we are in deep trouble.

Maybe it is you who has fallen for VI spin?

I would not claim to be an expert on the subject, although I have lived in the Middle East for 14 years and so have some interest in the topic, but history tells me that the doomsayers are invariably proved wrong by events.

http://www.vialls.com/wecontrolamerica/peakoil.html

http://www.wired.com/wired/archive/8.07/gold_pr.html

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Maybe it is you who has fallen for VI spin?

I would not claim to be an expert on the subject, although I have lived in the Middle East for 14 years and so have some interest in the topic, but history tells me that the doomsayers are invariably proved wrong by events.

http://www.vialls.com/wecontrolamerica/peakoil.html

http://www.wired.com/wired/archive/8.07/gold_pr.html

Just a point, but the VI spin is that there's plenty of oil and nothing to worry about. That's what they've been saying for decades. The whole concept of peak oil is largely rejected by VI's with only a couple of very recent exceptions.

So if someone has "fallen for VI spin" then by definition that can only mean that "someone has fallen for VI spin that there is plenty of oil". VI's just haven't spun the idea that there is a shortgage.

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A handy local source of meat for the McDonalds and BurgerKing franchises. Saves a fortune on shipping costs.

Those oil guys gotta eat!

Kentucky Fried Penguin anyone?

Rule #25: Never eat a carnivore.

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So if someone has "fallen for VI spin" then by definition that can only mean that "someone has fallen for VI spin that there is plenty of oil". VI's just haven't spun the idea that there is a shortgage.

It all depends on what you see as the agenda (or even if there is one) and who is pulling the strings. Ask yourself this, which companies have gained most from the recent panic over percieved shortages of oil supply or the "peak oil" theory?

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Maybe it is you who has fallen for VI spin?

I would not claim to be an expert on the subject, although I have lived in the Middle East for 14 years and so have some interest in the topic, but history tells me that the doomsayers are invariably proved wrong by events.

http://www.vialls.com/wecontrolamerica/peakoil.html

http://www.wired.com/wired/archive/8.07/gold_pr.html

DK, the interview with Gold is interesting and thought-provoking. Evidently he is right that some hydrocarbons can form by means other than transformation of organic matter. Likewise, no one would dispute that oil & gas are renewable, over some period of time. An interesting point made in Ken Deffeyes book is that production falls off in a field but it does not fall to zero, instead it steadies at a much lower output, which can be maintained for a very long time. Deffeyes does not follow this interesting observation up - the implication is that fields can replenish at some low level. But any slow refilling of depleting fields is not stopping declines from happening.

You also make the point that the oil companies have raked in a fortune from the oil shortage. But most of them deny PO. The people who are proposing PO are typical whistle-blowers: retired specialists and buccaneering types like Simmons. You'll have a damned tough job convincing me they are all in a conspiracy by the oil companies and OPEC.

And then we come to the lessons of history. Well, actually I have not observed that the doomers are always wrong. Every higher society that ever grew dominent has fallen, and the supremacy has passed to another power with a more relevant culture. The last century was a doomers sensation: a great liner did hit an iceberg with great loss of life; there was a great war; there was a lousy peace; it did lead to the rise of vicious militarism and another war; it was possible to build atom bombs, they were used and there was an arms race; Chernobyl did happen. I could add plenty of other horrors that were predicted and did happen. The one mistake doomers make is to assume we fall back into the stone age. We don't, when the worst happens things get a lot worse but it happens slowly and subtley and we don't really notice. So it will be with Peak Oil. Folk like Ruppert and Heinberg are wrong when they talk about industrialised socities falling to bits within five years of Peak. It'll be a shock and folk will adjust. It is inconceivable that they will adjust as they should. That is the disturbing part.

Edited by malco

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
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      • up 5%



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