by AdvocatusDiaboli » Sun 17 Oct 2004, 06:30:53
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')My question is "will or can PEAK OIL be delayed by the use of Coal based Fischer-Tropsch liquid fuels"? If so, how long? 10 years? or is it more?
That is the wrong question. The probable scenario goes like this: The peak will happen, then there'll be an energy crisis, then companies launch massive CTL programs and anywhere between 7 and 15 years post peak we'll have enough oil again - made from coal. The investments that have to be made every year are enormous - I calculated them to be roughly between 200 and 300 billion dollars.
This is, however, only about 0.5% of world GDP.
There will, of course, be initial bottlenecks especially in the area of qualified personnel.
The idea that "we won't have enough money to build this" comes from people who have little understanding of economics. If these investments are profitable, they WILL be made, the market will see to that. The problem are the long lead times in construction and the period until companies realize what's going on and that CTL is indeed profitable in the long run.
SASOL gives a figure of a cost of $20 per barrel (at the current unfavorable exchange rates). They use only very crappy coal that is of little use for anything else. The cost of the coal feedstock is about $8 per barrel, so a tripling in the price of the feedstock would still leave a barrel price of $36, which is affordable.
The companies that are going to build coal-to-liquid plants are likely going to be mostly the classic oil companies, as they have knowhow in the petrochemical area and also a dire need to find something to replace their aging business (conventional crude).
Nevertheless there are huge possibilities for companies like SASOL (SSL) or Headwater(HDWR), especially in licensing their technology.
I'm invested in both.