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A bleak picture as oil production slides

General discussions of the systemic, societal and civilisational effects of depletion.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Thu 08 Oct 2009, 20:54:20

$this->bbcode_second_pass_quote('mcgowanjm', '
')So why don't we issue a $ based on a BTU? Which means
that a $ has everything to do with BTU's.


Energy pegged currency! Interesting idea.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Thu 08 Oct 2009, 20:59:16

$this->bbcode_second_pass_quote('mcgowanjm', '
')Resilience v Growth is a whole other EROEI that you don't address.


Maybe because "resilience" and "growth" aren't in the EROEI equation either. I would love to see any equation which includes them though, it should be fascinating.
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Re: A bleak picture as oil production slides

Unread postby Tanada » Thu 08 Oct 2009, 21:06:31

$this->bbcode_second_pass_quote('jbrovont', 'A')faik, light sweet is sought after because (as sos points out) it's cheaper (easier) to refine aka "less energy intensive."

What do you think makes heavy crudes more expensive to refine?


Light oils are easier to make into Gasoline and the USA wants Gasoline so that makes them much sought after in international markets.

The biggest added cost in refining heavier crude oils is the additional equipment needed to crack the mixture into lighter fractions like Gasoline and Kerosene, and for the equipment to produce the Hydrogen which is integral to that process. The more Hydrogen you add and the smaller the pieces you crack it into the lighter the resulting fractions and the greater the percentage of Gasoline you get out. Because Diesel has substantially longer molecules than Gasoline it requires less refining and this means both that it has more EROEI and that it is easier to make from Heavy oils than Gasoline as a general rule.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Thu 08 Oct 2009, 21:07:28

$this->bbcode_second_pass_quote('mcgowanjm', ' ') Cantarell is going to a 150 000 BPD. And Chicontepec was the supposed backup. Maybe Mexico
is ready to do your ideas. They don't have anything else.


Fields decline. Fields die. While the fascination with this process, and in particular this field, goes to a depth around here that is simply amazing, it is at the end of the day nothing but an oilfield doing exactly what oilfields do.

Its decline also has nothing to do with EROEI.

$this->bbcode_second_pass_quote('mcgowanjm', '
')Or maybe Mexico will just collapse because they don't
realize the validity of your suggestions. :roll:


Mexico will suffer the consequences of the "resource curse" the same as Venezeula and Russia. And their mismanagement of their oil revenue has nothing to do with EROEI either.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Thu 08 Oct 2009, 21:12:53

$this->bbcode_second_pass_quote('jbrovont', 'A')faik, light sweet is sought after because (as sos points out) it's cheaper (easier) to refine aka "less energy intensive."

What do you think makes heavy crudes more expensive to refine?



I went and looked in Wiki.

"The lighter grades of crude oil produce the best yields of these products, but as the world's reserves of light and medium oil are depleted, oil refineries are increasingly having to process heavy oil and bitumen, and use more complex and expensive methods to produce the products required."

http://en.wikipedia.org/wiki/Petroleum

It seemed intuitive, but I do like to check things before referencing something.
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Re: A bleak picture as oil production slides

Unread postby Tanada » Thu 08 Oct 2009, 21:20:23

$this->bbcode_second_pass_quote('mcgowanjm', '
')I really can't believe this. This is the USA PO site.

I mean we've gone thru all of this in the past 5 years and still
the above:

If we wanted to do we could. That's what we've got here.
Nothing on why we've decided not to do ANY of the above.

Or maybe Mexico will just collapse because they don't
realize the validity of your suggestions. :roll:


Yes if we wanted to work to mitigate peak oil we could, nobody with a brain disputes that assertion. Why we decided not too has also been discussed ad nauseam on this board. Take your pick, cultural inertia, willfull ignorance, oil still to cheap and abundant, TPTB don't see a reason to switch yet...the list goes on from there.

Mexico is likely to collapse because their government on most levels is a corrupt Kleptocracy, which is hardly the kind of leadership one would expect to be making rational decisions about the future. The high roller types will be able to flee with their ill gotten gains when things really start to fall apart, for now most of them are still secure and enjoying their situations in Mexico.
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Re: A bleak picture as oil production slides

Unread postby jbrovont » Thu 08 Oct 2009, 22:41:53

I guess where our disconnect is, is that I'm considering the energy that goes into the more expensive process, producing the equipement etc. You see it as a monetary cost that can be extracted from the energy cost of production, whereas I see it as an energy cost represented in a monetary expense.

$this->bbcode_second_pass_quote('Tanada', '')$this->bbcode_second_pass_quote('jbrovont', 'A')faik, light sweet is sought after because (as sos points out) it's cheaper (easier) to refine aka "less energy intensive."

What do you think makes heavy crudes more expensive to refine?


Light oils are easier to make into Gasoline and the USA wants Gasoline so that makes them much sought after in international markets.

The biggest added cost in refining heavier crude oils is the additional equipment needed to crack the mixture into lighter fractions like Gasoline and Kerosene, and for the equipment to produce the Hydrogen which is integral to that process. The more Hydrogen you add and the smaller the pieces you crack it into the lighter the resulting fractions and the greater the percentage of Gasoline you get out. Because Diesel has substantially longer molecules than Gasoline it requires less refining and this means both that it has more EROEI and that it is easier to make from Heavy oils than Gasoline as a general rule.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Thu 08 Oct 2009, 23:02:32

$this->bbcode_second_pass_quote('jbrovont', 'I') guess where our disconnect is, is that I'm considering the energy that goes into the more expensive process, producing the equipement etc. You see it as a monetary cost that can be extracted from the energy cost of production, whereas I see it as an energy cost represented in a monetary expense.


I think you just made my point for me.

"Monetary cost that can be extracted from the energy cost of production"?
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Re: A bleak picture as oil production slides

Unread postby Pops » Fri 09 Oct 2009, 11:41:41

$this->bbcode_second_pass_quote('shortonsense', '')$this->bbcode_second_pass_quote('Pops', 'A')ll thats left is waiting to see who's demand is destroyed.

Easy. Whoever is irritated by the incremental change in price the most. The F150 owner who first buys a Accord. And then buys a Prius. And then collects a scooter. And then gets a Volt. Or rides a bike or bus. The time required to go from A to Z mostly determined by the irritation over variable fuel costs.

Economics in action, one decision at a time, multiplied by hundreds of millions of people.

Worked like a charm during the most recent peak oil, right? :-D

It didn't work like a charm during the "most recent peak".

Certainly some did buy a Prius, but unfortunately, the people who are "most irritated" by incremental change in price are, not surprisingly, the very same people who can't go out and buy a new $25k car - and the 17% of the population un- or under-employed could well have a problem buying a new bicycle.

In fact partly because of the "incremental" price changes last year that increased the amount paid by the average household for energy, I'd guess people have actually held onto their older less efficient vehicles longer than they would have otherwise.

But you're right, it is economics in action, desire or even need without the ability to pay is the definition of "destroyed demand".

[edited for brain fart]
The legitimate object of government, is to do for a community of people, whatever they need to have done, but can not do, at all, or can not, so well do, for themselves -- in their separate, and individual capacities.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Fri 09 Oct 2009, 19:18:42

$this->bbcode_second_pass_quote('Pops', '')$this->bbcode_second_pass_quote('shortonsense', '.')

Worked like a charm during the most recent peak oil, right? :-D

It didn't work like a charm during the "most recent peak".

Certainly some did buy a Prius, but unfortunately, the people who are "most irritated" by incremental change in price are, not surprisingly, the very same people who can't go out and buy a new $25k car - and the 17% of the population un- or under-employed could well have a problem buying a new bicycle.


Then other options became available...walk..bicycle...take a bus. Ride the Metro. Even during the "depths of Great Depression II" :-D people were buying 10 million NEW cars a year. Which means there were 10 million individual decisions being made which could reflect outrage over fuel....and undoubtedly millions more in the used market....if they really cared, i.e., "prices were high enough to irritate them".

$this->bbcode_second_pass_quote('Pops', '
')In fact partly because of the "incremental" price changes last year that increased the amount paid by the average household for energy, I'd guess people have actually held onto their older less efficient vehicles longer than they would have otherwise.


Thats actually a smart move, put off the capital investment for the new hardware...just drive the old, paid off stuff less. But it does not preclude the exact same system functioning if and when crude prices climb back up again.

In the meantime, the Saudi's look like they are sweating the actual effectiveness of this demand destruction thing....when the people set to profit the most off of peaker price fantasy's are the ones worried about how effective they think renewables and the electrification of transport might be, you know you are doing something right!
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Re: A bleak picture as oil production slides

Unread postby Pops » Sat 10 Oct 2009, 11:20:22

Yea, you're probably right sos, everything is fine.
The legitimate object of government, is to do for a community of people, whatever they need to have done, but can not do, at all, or can not, so well do, for themselves -- in their separate, and individual capacities.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Sat 10 Oct 2009, 12:30:20

$this->bbcode_second_pass_quote('Pops', 'Y')ea, you're probably right sos, everything is fine.


Are you kidding?

Not a dieoff in sight, prices for crude are down since peak happened, instead of freezing in the dark in our homes we've suddenly discovered so much locally supplied natural gas that we are DROWNING in the stuff, Alaskan King crab is available at local restaurants, ChinaMart is still full...of....china stuff, are you seriously suggesting that only now you are noticing?

While the attempts by the uninitiated (figuring its mostly younglings who haven't been through a real downturn before?) to turn a business cycle into Doom are amusing, I figure most everyone who's been through a few peak oils and the 70's/80's recessions and inflationary cycle all know better.
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Re: A bleak picture as oil production slides

Unread postby thuja » Sat 10 Oct 2009, 14:41:01

$this->bbcode_second_pass_quote('shortonsense', '')$this->bbcode_second_pass_quote('thuja', '
')
My point is not about the inequity and injustice in the world. My point is that your contention that we will experience a seamless transition away from oil...

is utter nonsense.

Try talking to someone outside your happy little bubble world.


I never said a transition away from oil would be seamless. Please don't assign to me your interpretation of my words, go find my actual words if you wish to use them against me.


Mmmm...please outline how things won't be "seamless". What could possibly go wrong?
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Sat 10 Oct 2009, 18:40:23

$this->bbcode_second_pass_quote('thuja', '')$this->bbcode_second_pass_quote('shortonsense', '
')I never said a transition away from oil would be seamless. Please don't assign to me your interpretation of my words, go find my actual words if you wish to use them against me.


Mmmm...please outline how things won't be "seamless". What could possibly go wrong?


Wrong? Price differentials are REQUIRED to allow substitutes and alternatives to flourish. Some people become very disturbed over price differentials because they believe that driving 4000# of steel down to ChinaMart, while doing burnouts for their friends and getting 8mpg because thats what a Hemi gets around town is a god given right.

Those people, and others to varying degree's for the same basic reason, have been ( when peak oil happened ) and will continue to be ( with any other peak oils or basic supply/demand imbalances ) very unhappy with those differentials.

Most certainly not seamless....
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Re: A bleak picture as oil production slides

Unread postby thuja » Sun 11 Oct 2009, 10:43:56

Price differentials? People will be "unhappy"?

All very vague. How about specifying how that will look. Be careful not to veer too far from the cornucopian camp or you might get booted out of the club.
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Sun 11 Oct 2009, 10:53:21

$this->bbcode_second_pass_quote('thuja', 'P')rice differentials? People will be "unhappy"?

All very vague.


But it does capture the uncertainty implicit in the event. Some of us will not care at all, my gasoline costs certainly went down in 2008 regardless of crude price because I made a specific capital investment to offset operating costs.

And certainly better than the "howling at the moon" routine some of the more hardcore around here seem to volunteer with no more cause than just another peak oil, or recession.

$this->bbcode_second_pass_quote('thuja', '
')How about specifying how that will look. Be careful not to veer too far from the cornucopian camp or you might get booted out of the club.


How what will look? You mean, like how much a fuel cell vehicle will actually cost when they are finally available to the public? Or how economically reasonable a Prius is over a F150? Or whether or not the Volt will pay for itself in X amount of time? How fast will the electrification of transport proceed?

Heck, I know better than to predict the future specifically, I certainly don't want the kind of egg on my face that peakers have managed to accumulate for themselves, I'll just stick with noticing that their fanciful scenario's certainly haven't shown up, and call that a good sign because it means their fundamental assumptions as to how the world works was wrong.
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Re: A bleak picture as oil production slides

Unread postby hardtootell-2 » Sun 11 Oct 2009, 10:56:11

$this->bbcode_second_pass_quote('thuja', 'P')rice differentials? People will be "unhappy"?

All very vague. How about specifying how that will look. Be careful not to veer too far from the cornucopian camp or you might get booted out of the club.


Here's how I see it

Yes a 9.1% annual decline rate on an energy source that provides about 70% of our available energy would be horrific.

Almost no businesses would be thriving much less holding on after a couple of years of that kind of pain.

Governments would be limping along with increasingly less services and more corruption due to rapidly declining tax revenues ("less than expected" :) ).

J6P would have no idea about how to pay for his gasoline, food and heating costs which are suddenly out of control and spiraling upwards.

Old folks would be frozen in their homes and crowding into soup kitchens. A few people would be scrambling to compete for their own resource base (a farm for example) but it would be increasingly unavailable because it would also be rapidly inflating.

Governments and companies would be ignoring all environmental regs on pollution just to try to keep the economic ship afloat. It would be obvious in hindsight how negligent governments were.

Citizens of heavily populated and polluted countries would be dying of pollution related illnesses en mass.

But then again a bit of a doomercopian
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Sun 11 Oct 2009, 11:12:20

$this->bbcode_second_pass_quote('hardtootell-2', '
')Here's how I see it

Yes a 9.1% annual decline rate on an energy source that provides about 70% of our available energy would be horrific.

Citizens of heavily populated and polluted countries would be dying of pollution related illnesses en mass.

But then again a bit of a doomercopian


Alot of your scenario appears to focus on the 9.1% annual decline. Considering the US has run a <2% decline for the past near 4 decades since its peak, the 9.1% certainly appears to be based on some other information which says that the world is 4X worse than the US. Is there a reason for this, considering that the US is a pretty good example, spanning decades, of how a near perfect Hubbert decline works?
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Re: A bleak picture as oil production slides

Unread postby hardtootell-2 » Sun 11 Oct 2009, 12:54:11

$this->bbcode_second_pass_quote('shortonsense', '')$this->bbcode_second_pass_quote('hardtootell-2', '
')Here's how I see it

Yes a 9.1% annual decline rate on an energy source that provides about 70% of our available energy would be horrific.

Citizens of heavily populated and polluted countries would be dying of pollution related illnesses en mass.

But then again a bit of a doomercopian


Alot of your scenario appears to focus on the 9.1% annual decline. Considering the US has run a <2% decline for the past near 4 decades since its peak, the 9.1% certainly appears to be based on some other information which says that the world is 4X worse than the US. Is there a reason for this, considering that the US is a pretty good example, spanning decades, of how a near perfect Hubbert decline works?


I will provide this link for the benefit of other readers

http://www.energyinvestmentstrategies.c ... il-prices/
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Re: A bleak picture as oil production slides

Unread postby shortonsense » Sun 11 Oct 2009, 12:59:20

$this->bbcode_second_pass_quote('hardtootell-2', '
')I will provide this link for the benefit of other readers

http://www.energyinvestmentstrategies.c ... il-prices/


Thats just nonsense. These are the same people claiming 110 Million/day in supplies without actually thinking about any of this.

For example, if declines HAVE been 9%, that means that the Saudi Arabia replacement/addition rate, instead of being every 3 years, is more like every 1.1 years, and last I looked, OPEC hasn't been swelling with the addition of all those new Saudi Arabia's lately.

I wonder why people even put that stuff out when their own math kicks them in the teeth?
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