[Taskforce_Unity]

$this->bbcode_second_pass_quote('smiley', 'G')ood work, however I think the prediuction for Mexico needs some adjustment.

Pemex supplies reasonable field by field information in their statistical yearbook.

stat

You can see that essentially everything except Cantarell is in decline. And Pemex official as well as the EIA have confirmed that Cantarell just hit the onset of the decline this year. That's 60% of Mexico's production declining at a 14% rate. Add that to the decline of the other fields and you get a much steeper decline than your data seem to suggest.

Judging by their latest figures they have a few other problems as well. Juli production is down by 400.000 barrels (probably due to the hurricane or something).

http://www.pemex.com/files/dcpe/eprohidro_ing.pdf

[HonestPessimist]

Does anybody realize that factoring the rising economic growth of a powerful nation with the demands of oil in the long term?

Look at China and its rapid-growing economic prosperity in the long term. With its population size and growing demands, oil will certainly be the most important resource for China, maybe significantly more important than the United States.

What's the long term effect on demands for oil with a fast-rising economic prosperity and demands from a powerful nation such as China?

Would the second decade of the 21st century be the tightest competition between China and the USA on oil?

[Taskforce_Unity]

Well it depends on if USA goes into depression or not i think.

I plan to make another (short this time) report on total oil exports on the market in the future. Obtaining data on consumption at the moment.

[FatherOfTwo]

I quickly read through your paper... would you summarize what the main difference is between your prediction of peak (2010-2015) and ASPO's prediction (2008 or earlier)?

[KevO]

$this->bbcode_second_pass_quote('bruin', 'G')reat report. You dealt very well with published reports. I actually found it very encouraging since I've been expecting a peak in 2008.

[GreyGhost]

$this->bbcode_second_pass_quote('KevO', 'I') think we'll do it guys.
Like cheap oil, the days of imminent peak oil are long gone.
We got through, we can keep on consuming albeit in a more eco friendly manner (global warming will see to that)

PO RIP

[Taskforce_Unity]

$this->bbcode_second_pass_quote('FatherOfTwo', 'I') quickly read through your paper... would you summarize what the main difference is between your prediction of peak (2010-2015) and ASPO's prediction (2008 or earlier)?

[rockdoc123]

$this->bbcode_second_pass_quote('', 'C')an't really find any good information. You seem to be translating the size of reserves to oil production in a certain way. Can you tell me what the rough correlation is?

[trespam]

Very interesting. It's nice to see concrete data to support my largely gut-feel rants in this place. In other posts I’ve set up a doomer straw man and poke sticks at it (no doubt acting the fool myself) but do hope people bring scope and context to this whole PO discussion.

I find it funny when a new member joins the board and is told by unnamed moderator that he should consider doing laps and pushups. Literally, or in so many words. New member: "I'm concerned about PO." Unnamed moderator: "get your self a big gun and do pushups and laps."

OK, a straw man here a bit also. But you get my drift. I spent the day yesterday pulling data out of journals at UCSD like energy economics and Oil and Gas journal to look at (a) economic responses to energy shocks and (b) liquifaction of coal, gas liquids and similar secondary sources of oil.

If you consider that (a) we will very likely have either an energy shock or a financial shock in the next five years and (b) we will also have the potential to increase production--as necessary--from gas liquids and potentially coal liquifaction after that, we're looking at a LONG emergency.

As another friend said: Some people don't realize. Energy may not be the issue. Global warming may be the issue. We're just not sure. Humanity may very well make it well past 2035 on the energy side with a few skinned knees (and some major broken bones or amputations from killer hurricanes). And global warming could have some non-linear effects (the emergent properties I refer to) in store for us.

In addition, if you look at the work over at OilDrum, they recently put up a chart of oil production depletion, with several scenarios. One was labeled collapse. It’s a great chart and thought provoking. But I brought up the point that I'm not entirely sure that consumption will track production down the production curve. It might. But industrial society is not optimized to track a depletion curve. We could very well see waves of demand destruction that lead consumption to drop below production capabilities. The counterargument of course is that society will restructure itself to optimally follow the depletion curve.

My response: might, might not. And this is another point I find interesting. The doomers (my straw man doomer) often talk about society as it if is a single rubber band that, when stretched too far, will break in some cataclysmic snap. Hence the need for those laps and pushups. When you hear that cataclysmic rubber band breaking sound, those pushups and laps in the peak oil bug out bag will mean the difference between survival and death.

But instead of a large cosmic cataclysmic societal breaking of the rubber band, how about accepting the fact that society is so large and complex, there may be breakages in ways and routes we’re not even considering. Someone—I’m going to look at this sometime—needs to look at how energy is used in our society. How much is used on almost completely non-productive ends. When we hit a certain price point, will there be waves of destruction that will largely destroy, for example, large segments of globalization, large segments of international travel, large segments of entertainment etc. What will that do to consumption? Will large numbers of the people who commute find themselves out of jobs? Will we face mini-depressions for the next century.

And when I bring this up, that’s when I get the “modern humans will not be able to accept this” or other points. Progress is an idea, not ingrained in our genes. People may be more resilient—and compassionate—than is represented by the few fools who harmed other people in New Orleans. Just don’t assume that by reading the Collapse of Complex Civilizations and similar books—all must reads of course—that we can easily apply this lesson to modern industrial society.

By the way: I recommend pushups and laps irrespective of peak oil. It’s like having health insurance. And supplies for one’s family in the event of emergency. Just makes sense. Irrespective of PO.

Also note: I still think humans are in overshoot. I'm just not convinced that it won't play out over the next 100-200 years. Not in the next five years. I think we are damaging the planet. But my concernw with that cannot interfere with my ability to think about peak oil and the alternate (read coal liquifaction and gas liquids) source of energy that will augment the depletion curves, along with demand destruction, to gets us through 2050 or 2060 or 2070.

There may still be a dieff off out there. I'm just not sure when. And that's where the folks who originally started thinking about this need to be cautious, even including Malthus long ago but also of course those who wrote some great material in the 60s, 70, and 80s: If they sound overly alarmist, (a) a lot of people will ignore them and (b) if their predictions don't happen soon enough, people will really ignore them and then the cornucopians will use them as straw men.

And that detracts from the real work and education that needs to take place. I put the Simmons bet with the idiot Tierney in a similar example. Might have been a bad idea. Might be looked back as yet another Simon/Ehrlich bet. It may prove to be a disservice to the cause.

[EnviroEngr]

$this->bbcode_second_pass_quote('trespam', 'V')ery interesting. It's nice to see concrete data to support my largely gut-feel rants in this place. In other posts I’ve set up a doomer straw man and poke sticks at it (no doubt acting the fool myself) but do hope people bring scope and context to this whole PO discussion.

I find it funny when a new member joins the board and is told by unnamed moderator that he should consider doing laps and pushups. Literally, or in so many words. New member: "I'm concerned about PO." Unnamed moderator: "get your self a big gun and do pushups and laps."

OK, a straw man here a bit also. But you get my drift. I spent the day yesterday pulling data out of journals at UCSD like energy economics and Oil and Gas journal to look at (a) economic responses to energy shocks and (b) liquifaction of coal, gas liquids and similar secondary sources of oil.

<snip>.

[seahorse]

All projections include assumptions:

(1) depletion rates, big unknown, and the U.S. average is probably not the average for the world; In fact, UK, Norway, and Yibel all suggest depletion rates may be much higher than commonly assumed;

(2) As Simmons points out, CERA was wrong about natural gas depletion just a few years ago, they were overly optimistic about natural gas and he believes they are being overly optimistic now with oil; there is a report on the forums from the CIBC that says oil will reach $100 per barrel by 2008, with production lagging demand by 3 mbpd, so their are contrary analysis from people other than ASPO; Even PFC Energy was quoted last year as saying PO could occur as early as 2012-15.

(3) Your assumptions all assume a perfect world, and Katrina shows just how the world can defy models. In fact, the full extent of Katrina is not known. An analogy is provided by Katrina itself, after the hurricane passed, everyone thought New Orleans was safely out of danger, then the levy broke. Just as the residents of New Orleans didn't know the full extent of the hurrican damage, we still don't know the full effects of the damage on the energy infrastracture. Based on mostly visual observation and rigs/platforms lost, we already know it is far worse than Ivan, and yet we still haven't conducted on site inspections of pipelines or most refineries yet.

(4) SA is still a big unknown, but suffice it to say, that for all the spare capacity they claim to have, they never provide it. In my opinion, actions speak louder than words;

(5) If find it hard to believe we can count on any substantial increases in Russian oil production, when there are numerous Russian oil news posts, from the Moscow Times, stating that oil production increases are quickly waning and may in fact, plateau in the very short term;

(6) As for African production increases, Simmons says these basically offset declines and will not, in his opinion, substantially increase the amount of oil on the world market. He agrees that Libya is the best hope for actually increasing African production.

(7) Chevron says we've used the first half of the oil inheritance, who am I to question that. BP now stands for beyond petroleum, who am I to argue. The French Prime Minister said we are now at the end of the petroleum age, who am I to question.

(8) I haven't seen a model yet that was workable, so, I go with what I can observe, gas has more than doubled since 2000, and why? In his defense, Campbell, since the 90's, has consistently stated oil would peak in the first decade of the 21st century, he may still be right. And even if he is off a year or to, the Hirsh report to the DOE says we need 20 years to prevent severe economic problems associated with PO.

So, PO may not RIP. The Peak Oil Hurricane is a Class Five, heading straight for you. Our system doesn't even have a levy to prevent the floods from PO. I have three little kids. This issue will impact them and me. So, everyone better start filling sandbags now while you still have a chance to prevent some of the flood damage.

[Taskforce_Unity]

$this->bbcode_second_pass_quote('seahorse', '
')(1) depletion rates, big unknown, and the U.S. average is probably not the average for the world; In fact, UK, Norway, and Yibel all suggest depletion rates may be much higher than commonly assumed;

[seahorse2]

As for Campbell, there is a discussion forum on him where I put down the elements of his timeline from all the public sources I could find where he made predictions. Other than his recent ASPO newsletters, in his 90s forecast he consistently said PO would occur in the first decade of the 21st century.

The significance of the Chevron adds talking about using the first half of the oil inheritance are important for two reasons that I see - first, bc now major oil company has ever run an add talking about the end of the oil age. That has significance. Further, the fact that they say we've used the first half does lend support to pessimist estimates that we have used close to have of estimated world URR. Maybe Chevron will post the figures from which they came to the conclusion we've used the first half.

As for Saudi Arabia, I'm including this post regarding SA's position, which I think is contrary to most of what we've heard recently about SA and in fact, is supportive of what the pessimist have been saying. Here is is, from another forum I just posted in:

Regarding SA, I think there is serious reason to question their claims, and I base that on the article Sada al-Husseini wrote for Oil and Gas Journal, August 2, 2004. This was an article which appeared in a series of articles specifically addressing Peak Oil. Unlike unnamed SA sources, this is coming from someone "in the know." In that article, Husseini states:

Regarding the Caspian Sea and Siberian pipelines offsetting declines in North America and the North Sea, he states:

"in any case they would not offset the accelerative production declines in North America and the North Sea while accomodating increasing demand throughout the world."

Regarding new OPEC capacity scheduled to come on-line in late 2004, he stated:

"this is a limited volume from plants and facilities under commissioning and originall was scheduled to replace declining capacity in any case."

Regarding long term price of oil, he states:

"In the longer term, crude oil prices are destined to continue to escalate through the end of the decade."

Regarding the abundance and development potential of future Russian and OPEC reserves, he writes:

"the future resources themselves may not be as abundant or readily available for development as assumed by organizations such as the EIA and the US Geological Survey."

He disagrees with the optimist opinions regarding future oil production capacities:

"even if the USGS and EIA resource estimates are technically feasible, their conclusions regarding future oil production capacities are not straightforward and cannot be reliable."

He states that no one is undertaking the investment necessary to meet the optimistic production calculations:

"There is no evidence that these policies and hence the investments are occuring on the required scale anywhere in the world."


He warns of rapidly depleting the resource base even if the investment was made:

Furthermore, if a rapid increase in global oil production were to occur, it would result in an accelerated depletion of proven and existing resources" [side note, this is what Simmons and other pessimist have been saying]

He notes how even a large field like Kashagan is "proving to complex a technical and political challenge for the rapid exploration of its resources."

Regarding future oil discoveries:

"it is realistic to assume there will continue to be future oil discoveries and developments, the majority will be smaller, complex accumulations. Consequently, their finding and development costs will be higher than past experience." [note, sounds like ASPO and Simmons, except that he's from Saudi Arabia]

[Taskforce_Unity]

$this->bbcode_second_pass_quote('seahorse2', 'A')s for Campbell, there is a discussion forum on him where I put down the elements of his timeline from all the public sources I could find where he made predictions. Other than his recent ASPO newsletters, in his 90s forecast he consistently said PO would occur in the first decade of the 21st century.

[seahorse2]

Dismissing as "only words" when that's all we have is someone's word, whether is written or spoken. In the end, we can only rely on the information given. The significance of Husseini is that he is from SA, retired from there, was writing on the issue of Peak Oil. His statements should be as reliable as anything else coming out of SA. At least, they should be used as contrast to recent more optimistic statements from SA. Further, I note also a news post some months ago that SA was putting investment into solar. Seems significant for a country that claims an oil endowment of 460 billion barrels plus. They could run all their lights on oil generators for years and years to come. So, why put money into solar and not put that money into developing producing the 460 bbl of oil they supposedly have? Why hasn't SA oil not increased passed the 9.5 mbpd in the last 12 months? Could is be that Husseini is right, and the new production last year was to offset normal depletion? Further, and within the last 3 months, there was the news release from SA that OPEC could not meet the IEA's estimated OPEC production requirements past another 10-15 years. I found this article significant, bc again, like Husseini says, it seriously questions the IEA and others optimistic assessment for OPEC oil production. It also reaffirms why SA would be investing in its solar potential. I will try to find the link to the Campbell forum and post it here. As far as Katrina, only time will tell how significant the damage is, but it could last a lot longer than 6-12 months. As one oil official said last year after Ivan, you cannot make up for a barrel of oil lost each day. Everyday we lose a barrel of oil, we've lost it. To make up for it, you would have to pump two barrels from the same well, which can never be done, so you are always behind. Katrina simply shows us the problem we are facing, which is, where's the oil?

[Taskforce_Unity]

Well i didn't mean that Husseini is not a credible source. He is very credible to my opinion, the most credible person regarding Saudi Arabia! But what he says can be interpreted in many ways, thats what i ment.

As for Katrina, only time will tell. I think the impact on oil production will not be that big. The impact on demand will be far greater (American economic destruction)

[seahorse2]

Here's was my earlier review of Campbell's past predictions. Take it for what its worth.

My take on Campbell's past writings (at least those available on the net). In short, Campbell has been more accurate in predicting some political/economic events than he has been in calculating reserves or estimating daily production of oil. As Lynch points out, Campbell's calculations of reserves keeps going up. For example, 1996, Campbell calculated world oil production would peak at less than 70mbpd. His 1996 # for world oil was 1750 gb. The world now pumps about 84 bpd and ASPO now calculates about 1850 gb (ASPO April 2005 newsletter).

However, here are some of Campbell's previous predictions of fallout from rising oil, which he says are caused by depletion issues. These are summarized, with my comments in parenthesis as to the accuracy:

1996 Campbell states:
(1) North Sea would peak in 1998 and then have about 8% depletion rate(peaked in 99 and has depletion rate of about 5-6%);
(2) Iraq will be needed, meaning "embargo relaxed", to produce all out beginning in "about" 2000. (Iraq attacked in 2003, but can't get it pumping all out).
(3) Graph shows 2005 oil at $30pb (price is now over $50);
(4) Graph shows total world oil at 1750 (he now says 1850);
(5) Graph shows maximum daily output of less than 70 bpd (world is pumping about 84 bpd);

1999 - Campbell's Speech to House of Commons

(1) Oil price shock around 2001 which will trigger a stock market crash (oil prices jumped in early 2000 followed by stock market crash);
(2) predicts hedge funds will manipulate the market (sound familiar?);
(3) Economic tension as Europe, America, Japan vie for access to ME oil, more missiles (what we had was tension over Iraq invasion, wars in Afghanistan and Iraq, Japanese troops in Iraq, EU tension with each other, some deploying troops, some not);
(4) Oil plateau around $30 pb (way off, now $50+);

March 23, 2000 Campbell wrote:

(1) OPEC will make conciliatory noise about raising quotas to maintain their illusion (sound familiar?);
(2) People finally realize no spare capacity (March 16th, 2005?, Goldman Sachs? Bank of Montreal? EIA updated monthly report of April 2005?);
(3) Upward momentum drives oil through $40 pb (past that);
(4) World, Opec, finally realize losing battle to offset depletion (not quite there yet);
(5) Opec will be 50% of world production capacity by 2009 (non opec oil is expected to be in decline by 2009 as per Peter Wells, writing an article for Oil and Gas Journal, Feb 21, 2005);
(6) calls to send in Marines (Iraq?);
(7) conventional oil peak around 2005 (he has modified this in ASPO April newsletter to 2006, however, EIA April Monthly Update expects a 700,000 bpd shortfall between estimated world oil production and estimated world demand);
( All oil peak by 2010 (latest ASPO newsletter lowers this to 2007, see also Petroleum Review of Mega Projects, nothing coming online after 2007);
(9) 2008 swing share production will be gone and thereafter expect 3% decline rates (we'll see).

All in all, his calculations on oil and estimated daily production have been off, but many of his political/economic predictions have been fairly accurate.

[trespam]

$this->bbcode_second_pass_quote('Taskforce_Unity', '
')I saw that one, unfortunately those are only words which can be interpreted in many, many ways. No hard facts so not of really much use i would say, except that it is an indication for an early peak (between 2008 and 2015).

[trespam]

Ok. Yet another consideration: Oil & Gas Journal. Mar 8 2004. Maarten Van Mourik and Richard Shepherd. "Investment incentive concerns overlooked in peak-oil debate."

By the way, Oil & Gas journal has had one or more special issues on peak oil. And yes, there are those who say they are just mouthpieces for the energy companies. Then again, they've allowed peak oil supporters to contribute with ideas and issues.

Here's the thinking: Why would oil companies be marketing the idea of the end-of-oil age, e.g. willyoujoinus.com? Could it be that they are preparing the world for more expensive oil? And if so, does that mean that production will collapse quickly? Not necessarily. Consider yourself as an oil company. You're finding it more and more expensive to develop new sources of production. Production is in dangerous places. Or in deep waters. You don't want to make the investment if you aren't guaranteed a return. One way to get around this is to start squeezing. I mean lets be serious. Do you think oil companies want the world to collapse tomorrow? Do you think they want industrial society to end tomorrow? Do they have private islands paradises ready and prepared to retreat to when industrial society collapses?

I doubt it. Ok, maybe they do have private islands. But they like those weekends in NYC. If there is a conspiracy of any sort, I'd think it could easily work in the following way. Oil companies are not going to make the riskier investments until they know they can get an easy return. And they won't know whether they can get a return until they squeeze on the Saudis to determine just what they are capable of. Once they know that the Saudis are spent, and once the price of oil finds a new level, say $100/barrel, the oil companies will face less risk in developing new sources. And activity will pick up.

Does this mean we can all breathe a sigh of relief? Not really. Because it is true that there are no big mondo fields left. But the oil companies, facing higher development costs just to keep up with depletion, have little or no incentive to go after the higher fruit when oil is cheap.

The article in Oil and Gas journal make an argument of this nature and predicts a tightening. It also argue that the nature of investment in the oil business change significantly in the 80s and 90s. Hence the lack of new fields coming beyond 2007/2008. Not that there aren't places where they can continue to pick those higher fruit. But they just weren't finding it worth the risk until the price of oil is higher.

Think of it another way. If oil companies know that the low hanging fruit is largely picked, isn't it in their interest to start the demand destruction through a tightening of supplies. Remember, these are not oil companies. They aren't necessarily thinking of themselves in this way. They are energy companies. And they can read the writing on the wall. The supply is limited, the customers want more, and it's time to make the customer start the process of withdrawal--without dying.

Again, long term, say between now and 2100, major dislocation in indistrual society of some sort or another. Tomorrow? Nah. Maybe energy shock tomorrow. I've seen those before. It's that 70s show. And in case you haven't noticed, 70s styles are back. So it all fits. In addition to putting the squeeze on production, they've manipulated the mass media to make 70s styles popular once again. It all fits.

So just get used to those higher prices. Get your white angel flight suit out of the attic. And start practicing those Disco moves. The 70s are back. And we've even got Vietnam and Richard Nixon redux (Bush has lower popularity than LBJ and Nixon--he's crashing man, and he deserves it completely).

Just another consideration for those on the edge of despair. It is true? Well, not necessarily. Just another consideration to take into account.

[trespam]

$this->bbcode_second_pass_quote('trespam', '
')Again, long term, say between now and 2100, major dislocation in indistrual society of some sort or another. Tomorrow? Nah. Maybe energy shock tomorrow. I've seen those before. It's that 70s show. And in case you haven't noticed, 70s styles are back. So it all fits. In addition to putting the squeeze on production, they've manipulated the mass media to make 70s styles popular once again. It all fits.

So just get used to those higher prices. Get your white angel flight suit out of the attic. And start practicing those Disco moves. The 70s are back. And we've even got Vietnam and Richard Nixon redux (Bush has lower popularity than LBJ and Nixon--he's crashing man, and he deserves it completely).