[bobbyboy]

$this->bbcode_second_pass_quote('', 'W')SJ: So you think the peak could be hit in as few as three years? How would we know we're at the peak, and what do you mean by "fall off the cliff"?

Mr. Rice: The timing depends on when several of the world's largest oil fields begin to roll over. Unfortunately, information on most of these fields is guarded as a "state secret" and is difficult to obtain and analyze. Suffice to say that the average age of the Mideast fields in question (is) over 50 years old, and when they start to decline, the decline will be over 10 percent a year. That would be "peak oil," as the world probably couldn't add enough new production to offset declines of that magnitude from the giant fields.

[auscanman]

he may be referring to ME giants only, but if this is true, then a hell of a lot of new production (that isn't there) will have to come online to offset it. Gains in Africa and elsewhere couldn't possibly compensate for several ME giants going into 10% decline pretty much simultaneously. The day can't be far away when Ghawar's decline is officially announced... Should be a very interesting 3 or so years ahead of us.

[Cynus]

Good find. Interesting to see someone who manages a major mutual fund for a large company come out and acknowledge that PO factors significantly in their thinking. Also interesting to see that he anticipates PO within the next 3 - 12 years. Also also interesting to see that this major investment company is just as clueless about when it will happen as we on this board are and that they scrounge around looking for informaiton.

[Zardoz]

$this->bbcode_second_pass_quote('Cynus', '.')..Also interesting to see that this major investment company is just as clueless about when it will happen as we on this board are, and that they scrounge around looking for information.

[ohanian]

[JPL]

$this->bbcode_second_pass_quote('Cynus', 'G')ood find. Interesting to see someone who manages a major mutual fund for a large company come out and acknowledge that PO factors significantly in their thinking. Also interesting to see that he anticipates PO within the next 3 - 12 years. Also also interesting to see that this major investment company is just as clueless about when it will happen as we on this board are and that they scrounge around looking for informaiton.

[mekrob]

$this->bbcode_second_pass_quote('', 'T')he day can't be far away when Ghawar's decline is officially announced... Should be a very interesting 3 or so years ahead of us.

[bruin]

A lot of our oil production data comes from counting tankers ast they sail by. Needless to say, our information is very weak and error prone. What if the guy counting the tankers takes a nap? Catches a movie?

[Tanada]

$this->bbcode_second_pass_quote('bruin', 'A') lot of our oil production data comes from counting tankers ast they sail by. Needless to say, our information is very weak and error prone. What if the guy counting the tankers takes a nap? Catches a movie?

[grillzilla]

$this->bbcode_second_pass_quote('', ' ')If the USA has a zillion wells with an 88% water cut you can bet the Saudi's will keep pumping till they are past 90%!

[Dan1195]

Any large field that has utilized secondary/tertiary recovery methods will be prone to this type of collapse, as will deepwater fields. Some of the largest fields, includings Canterall and Ghawar are prime examples. Canterall is it well known will enter steep decline very shortly. With Saudi data so closely guarded we will probably not know when it happens to Ghawar until its production is declining to the point where the Saudis cannot hide it by blaming maintenance, "temporary disruptions" of various kinds, releasing there own crude stockpiles, etc. Given that any further supply increases on a year to year basis will be small at best, the date when Ghawar entered terminal decline will be significant to the actual peak.

If a large amount of sigificant fields are being overproduced in an effort to push production higher then we will be at risk or the aforementions steep declines, though probably not until post-2010 maybe even 2015 in a best case scenario (assuming such decline rate actually occur)

[SoothSayer]

10% a year production would hurt ... especially if you only had 1 years notice as Hirsch states.

Compound interest of 10% soon adds up!

And we haven't even considered the 2% or so global growth rate ...

The first year would be used up by media bleating.

The 2nd year would include media panic and signs of severe economic problems.

By the 3rd year the governments would be enacting all sorts of "helpful" (fascist) laws to "improve" the situation.

I can't even begin to imagine what year 4 would be like .... with 30% - 40% oil production shortfalls in comparison with now ... and a world demand possibly 8%-10% higher than now.

Whilst I doubt that all this would push us into Mad Max territory, life would be very, very different!

Such a rapid decline would also mean that even partial alternatives would not be ready in time - or would not have the energy available to implement them.

We could enter a shabby, poor, cold world far quicker than might be expected ... with only the rich & politicians & petty minded civil servants doing well.

Oh - and of course the Black Market.

Scary stuff.

I will miss the space shots, the never ending improvements to computers, TV and all those other high tech things.

I don't really want to spend my time digging vegetables.

Perhaps now is the time to retrain as a policeman?

[Tanada]

$this->bbcode_second_pass_quote('grillzilla', '')$this->bbcode_second_pass_quote('', ' ')If the USA has a zillion wells with an 88% water cut you can bet the Saudi's will keep pumping till they are past 90%!

[Doly]

$this->bbcode_second_pass_quote('grillzilla', '
')The field where I work has to deal with a 95% water cut and let me tell you the problems become difficult to deal with.