[DantesPeak]

I can't access the article below at this time, but it seems to confirm Platts Oilgram report that Khursaniyah is not gearing up for full production soon. So - where is SA going to get that 500,000 bpd???


$this->bbcode_second_pass_quote('', 'S')audis See Project Deadlines Slip

As Saudi Aramco struggles to start pumping from the 500,000 barrel per day Khursaniyah project, its next set of oil projects looks likely to miss start-up deadlines too. These include the high-profile 1.2 million b/d Khurais field, which may be facing delays of at least six months, and the smaller Shaybah and Nuayyim projects, which could also be pushed back. (Monday, June 16, 2008)

[shortonoil]

DantesPeak quoted:

$this->bbcode_second_pass_quote('', 'A')s Saudi Aramco struggles to start pumping from the 500,000 barrel per day Khursaniyah project, its next set of oil projects looks likely to miss start-up deadlines too. These include the high-profile 1.2 million b/d Khurais field, which may be facing delays of at least six months, and the smaller Shaybah and Nuayyim projects, which could also be pushed back. (Monday, June 16, 2008)

[rockdoc123]

I remember seeing a recent article in Middle East Oil and Gas Journal that suggests Shaybah has been fast tracked and that Khurais was back on track. I'll have to dig around to find that. My suspicion is that not all of the 500 K will come from Khursaniyah...again need to dig a bit.
I think it is important to note that the Saudis have the best track record in the industry for delivering projects on time and on budget. A couple of months delay is small beer compared to the years of project delays we've seen in the Caspian, West Africa and the GOM.

[DantesPeak]

$this->bbcode_second_pass_quote('shortonoil', '[')b]DantesPeak quoted:

$this->bbcode_second_pass_quote('', 'A')s Saudi Aramco struggles to start pumping from the 500,000 barrel per day Khursaniyah project, its next set of oil projects looks likely to miss start-up deadlines too. These include the high-profile 1.2 million b/d Khurais field, which may be facing delays of at least six months, and the smaller Shaybah and Nuayyim projects, which could also be pushed back. (Monday, June 16, 2008)

[mos6507]

$this->bbcode_second_pass_quote('EnergyUnlimited', '')$this->bbcode_second_pass_quote('KevO', '
')We're Fark, we just don't know it yet

[KevO]

$this->bbcode_second_pass_quote('mos6507', '')$this->bbcode_second_pass_quote('EnergyUnlimited', '')$this->bbcode_second_pass_quote('KevO', '
')We're Fark, we just don't know it yet

[TheDude]

$this->bbcode_second_pass_quote('KevO', 'I') actually typed 'fu**ed' but it changed to fark all by itself.

What's fark for farks sake?

[Graeme]

Learning From the Oil Shock

$this->bbcode_second_pass_quote('', 'T')he world may have arrived at the equivalent of Peak Oil. Old fields are in decline, while governments limit new oil projects.

Do not underestimate oil's fallout. As a practical matter, the world may have arrived at Peak Oil: that condition when dwindling oil reserves no longer permit much, if any, annual increase in production. This may not be literally true; estimates of vast undiscovered oil reservoirs imply that Peak Oil is decades away. But governments that control 75 percent or more of known oil reserves are behaving as if Peak Oil is already here. They're hoarding a scarce commodity by limiting new exploration projects. Meanwhile, production at some old fields is dropping rapidly. Spare capacity has been depleted, as demand outruns new supply.

[Graeme]

'North Sea oil will last for 100 years'

$this->bbcode_second_pass_quote('', 'D')r Richard Pike, a former oil industry consultant and now the chief executive of the Royal Society of Chemistry, said: "Rather than only getting 20 to 30 billion barrels [from the North Sea] we are probably looking at more than twice that amount."

His analysis is supported by petroleum experts who believe there are some 300 fields off the coast of Britain still to be explored and tapped properly. If energy prices continue to soar, companies will become increasingly willing to tap previously uneconomic oil fields.

Dr Pike claims that the industry knows the true figures but refuses to release them because of commercial secrecy.

$this->bbcode_second_pass_quote('kjmclark', '')$this->bbcode_second_pass_quote('OilFinder2', 'T')he API of Khursaniyah is actually around 28-29, which is on the border between light and medium grade. So it's not really "heavy" oil. The sulfur content is about 2.8%, which is moderately high, but not the highest (source). So overall, this sounds like about "average" grade oil.

[kjmclark]

$this->bbcode_second_pass_quote('OilFinder2', '
')Perhaps you should have actually read the article which opened this thread:
$this->bbcode_second_pass_quote('', 'S')audi Arabia is completing a huge expansion program in its oil industry that is expected to bring its production capacity to 12.5 million barrels a day by 2009. As part of that expansion, Saudi Aramco, the country’s national oil company, is planning to start soon an oil field, called Khursaniyah, with a daily production rate of 500,000 barrels.

[copious.abundance]

Let's see . . . Saudis say they're gonna increase oil production by 500K bpd. It just so happens that they're also about to start production at an oil field named Khursaniyah which will produce . . . 500K bpd. So I wonder where this new 500K bpd is gonna come from? Hmmm . . .

[AlCzervik]

Graeme, do you believe this horseshit when North Sea is already in decline?

[thylacine]

So it might be in the oil companies interests to understate their reserves, thereby hoping to duck beneath the radar of government revenue raisers and also managing to keep on producing longer than expected thus keeping shareholders happy for longer. But, about three quarters of global production comes not from private oil companies, but from state enterprises and they (or at least those in OPEC) have been shown to be probably grossly overstating their reserves. Taking what may be the case in part of the oil industry and extrapolating it out over the globe may be drawing a bit of a long bow.

As for the North Sea lasting another 100 years and producing the same again as it has over the last 35 years. Big deal. Production rates are unlikely to ever rise back to where they were a few years ago (or even rise again, full stop).

These sort of reports get leapt on and reported in the press, with the implication being that it's OK, don't worry, go back to sleep, there's plenty more oil. But the UK is now a net importer of oil and, if they carry on as they are, they will have to import increasing amounts of foreign oil in the future. The best they can hope for is that the decline in their domestic production is less steep than expected.

[Graeme]

$this->bbcode_second_pass_quote('AlCzervik', 'G')raeme, do you believe this horseshit when North Sea is already in decline?

[hardtootell]

Wow!
Fatih Birol's interview is like a bolt of lightening! If Sheeple had a clue they would be freaking out.

[TheDude]

Pike said his hunch was based on "anecdotal evidence" (in the stories from last week), now it's a bit more meaty:

$this->bbcode_second_pass_quote('', 'O')il companies produce a bell-shaped probability distribution for how much each oil reservoir might hold, and then quote as an indicator of the reservoir's capacity a figure they are 90 per cent certain they can exceed. When publishing a result for multiple reservoirs, they simply add up the figures for each one. And this is where the problem lies.

"They should be combining the bell curves for each reservoir," says Pike. Adding the numbers for each reservoir ignores statistical information about the extremes of the distribution, giving a result which underestimates the true total figure for all the reservoirs.

According to published estimates, there are 1200 billion barrels still to be extracted, but Pike says there could in fact be twice as much. "The figures are almost meaningless and just provide a conservative estimate for shareholders."

[ki11ercane]

Question #1 - what alternatives are oil executives afraid the world is going to turn to that in themselves will require no OIL/NG/COAL to create and bring online in the first place? (ie. wind, solar nuclear) Have I missed some alternative fuel source that require zero energy to invent/research/manufacture/implement?

Question #2 - if these figures are true, and if the cost of fossil fuels et al are more tomorrow than they are today, what's the point of extracting them if the cost to produce the infrastructure to extract these fossils will simply make these extracted findings MORE MONEY?

[Graeme]

Gazprom Neft Aims to Become Russia’s Leading Oil Producer

$this->bbcode_second_pass_quote('', 'G')azprom Neft (GZPFY.PK), the oil production subsidiary of Gazprom (OGZPY.PK), has stated in its 2007 Annual Report that it expects to more than double oil output to 2.0 million barrels per day by 2020 from a production average of 864,000 bpd in 2007.

Gazprom Neft's production target is assessed to be attainable, mainly due to the Company's ownership of the massive, and largely undeveloped South Priobskoye oil field, one of Russia's largest known oil fields, known in Russia as "the Pearl of West Siberia."

The total Priobskoye oil field is a relatively new oil field in Russia, with oil production only starting up on a large scale in 2001 in the Northern portion of the field. Production for the field is ramping up rapidly on a large scale. Gazprom Neft produced approximately 125,000 barrels per day of oil from Priobskoye in 2007, and announced in mid 2007 that it plans to increase production by 2.6 times to over 300,000 bpd in 2010. ("Russian Gazpromneft-Khantos Oil Output To Rise 2.6-Fold by 2010,” Energy and Commodities Digest, 8/21/07). Gazprom Neft also announced a development budget of $US11.22Bn for the next three years for all undeveloped fields, with a large chunk to South Priobskoye.

Can production increase further beyond 2010 at Priobskoye? The entire Priobskoye oil field is very large, measuring between 5466 square kilometers as a whole in size compared to Ghawar (world's largest oil field, located in Saudi Arabia), which totals approximately 7,500 square kilometers in size.

The study indicated 27.6 billion barrels of recoverable oil at Priobskoye -- it is ambiguous, however, if the study refers to all of Priobskoye or the Northern portion of the field. In the case that the number refers to the total field, the number of 27.6 billion recoverable barrels would place Priobskoye as one of the 10 largest oil fields in the world.

[Graeme]

killercane, Your questions are not easy to answer in a few minutes but I'll try. At the moment, the dominant alternative fuel is ethanol. You can see from the RFA web site that many countries are planning to introduce blends of ethanol into gasoline mix, and most have import tariffs. The latter is what Brazil is complaining about because there is no global free trade for ethanol yet. The USA and other countries may lift tariffs in the near future. Of course, ethanol production will increase worldwide and this will displace oil consumption. Production in the US is moving from corn to other sources such as switchgrass, wood and waste.

Other alternative fuels are biobutanol, and "renewable petroleum". There are likely to be others that I'm not aware of or missed (biodiesel). In addition, manufacture and sale of battery and fuel-cell vehicles, as well as increasing use of public transport (bus/train) possible compulsory rationing will also reduce oil demand.

I'm sure that the cost of producing conventional (and unconventional) oil is not yet prohibitive, and that this energy source will be sold on world markets for many years to come.