Is the World Approaching the Inevitable Hubbert's Peak of Oil Production?

[apeiron]

I wouldn't doubt that in the next 20-30 years there will be geothermal drill sites in places where the geothermal activity isn't near the surface---where there will be 8-10 mile drill holes to tap high heat resources.

Of course current projects have run into problems...

http://topics.nytimes.com/top/news/...cp=1&sq=hot rock geothermal earthquake&st=cse

 

[apeiron]

The problem with official estimates of course is whether we can trust those in charge to tell us the truth...

The world is much closer to running out of oil than official estimates admit, according to a whistleblower at the International Energy Agency who claims it has been deliberately underplaying a looming shortage for fear of triggering panic buying.

http://www.guardian.co.uk/environment/2009/nov/09/peak-oil-international-energy-agency

And then when mainstream figures like Sir David King (UK Government’s Chief Scientific Adviser and Head of the Government Office of Science, 2000 to 2007) sound the alarm bells, do we just conclude they have just lost their heads, gone over to the other side?

The report also suggests that the current oil reserve estimates should be downgraded from between 1150-1350 billion barrels to between 850-900 billion barrels, based on recent research.

http://www.smithschool.ox.ac.uk/world-oil-reserves-at-tipping-point/

 

[apeiron]

Here is a good account of the kind of high level realistic discussions now taking place. Rather than people shouting 'yes it is', 'no it isn't', here we have a search for what can be known and a consideration of the range of uncertainty.

http://transitionculture.org/2010/0...process-of-government-acknowledging-peak-oil/

 

[edward]

Actual supply statistics are polluted by corrupt oil monopolies so it's hard to judge how much oil there is exactly.

You must also take into consideration that new oil fields are being discovered, and new technology is allowing us new ways to mine and manufacture the oil.

http://www.wnd.com/index.php?pageId=59502

World Net daily is at the bottom of the barrel as a reliable reference. It is the home of the extreme right and about every conspiracy theory that they come up with.

Most of the content is outrageous., as seen below

http://www.wnd.com/index.php?fa=PAGE.view&pageId=95917

 

[apeiron]

Doom Soon is my honest & reluctant prediction, if we get whooped by an asteroid in this transition phase it may well be game over mankind

I think you are erring on the optimistic side with the date of collapse myself! 2030 is the bottleneck decade for peak oil, global warming and over-population.

But then there is the question of the response. There are both technological possibilities (the alternate tech fixes) and the social possibililities (energy descent, relocalisation).

We will either be moving from a time of boom to just brutal bust (Easter Island on the global scale). Or we may move from one kind of socioeconomic system to a better adapted one.

A process that will be very uncomfortable just for the fact it must be so different. Yet it could also ultimately be a better one in hindsight.

This is actually what I am looking into - the range of responses now taking place, from the preppers to the transition towns to the guys turning algae into biofuel. And even the local neo-nazi skinheads doing their combat training, getting ready to take over their 'hood.

There are those heading for the hills with guns (even in NZ) and those who are focusing on creating locally resilient communities, planting nut and fruit trees now, learning how to make soap and cheese.

What will the future look like? What more interesting question can there be?

 

[russ_watters]

We don't live in a world of perfect information. We all need to make our own assessments on this one.

Fine, but that's not what you said before: before, you said this was a mainstream view. You seem to now be acknowledging that it really isn't.

As for nuclear reactors taking up the slack, there is also peak uranium to think about of course.

http://en.wikipedia.org/wiki/Peak_uranium
http://www.theoildrum.com/node/2379

No doubt, birds of a feather flock together. Peak uranium is even more crackpotish than peak oil. It was cited earlier in the thread with an utterly absurd claim, but the reality is that we have a relative eternity's worth of nuclear fuel available compared to what's left of our oil. Hundreds of years at the very least. No reputable scientist sees a uranium production problem in the next century. Heck, in the US, we're already storing as "waste" enough perfectly good nuclear fuel to keep our existing plants going for another couple of centuries.

...before the economy collapses.

This is the heart of the issue and the heart of my disdain. "Peak Oil" really isn't really about a peak in oil production (which, whenever it happens, is a real phenomena), it is about doomsaying over what happens after we pass peak oil. That's what gets passionate and gullible people to buy books. That's why the title of the thread isn't just "Hubber's Peak" but rather "Hubbert's Peak. The oil crash." [emphasis added]

The beauty of this, as opposed to the 2012 doomsday claim is that peak oil is actually going to happen eventually. When 2012 passes and nothing happens, the books will stop selling. With Peak Oil, when 2006 passes and oil doesn't peak, no problem: just update it with a new date and re-publish the book. The best scenario of course is for the optomists to be right and oil to peak later, which allows for decades of book sales.

But the prediction is no less apocalyptic than the 2012 crackpottery and no less unreasonable. The book who'se title is paraphrased in the title of the thread has the tagline "Civilization as we know it is coming to an end soon." and talks about a "post-industrial stone age". Presumably, that's what has people buying houses in the country and living off the grid, but it is no less nonsensical than the 2012 crackpot nonsense.

No, that was the person I was talking to. I moved from London.

Ok, so are you saying you moved from London to NZ because of peak oil?

 

[apeiron]

Fine, but that's not what you said before: before, you said this was a mainstream view. You seem to now be acknowledging that it really isn't.

No, I think business leaders and chief scientists and international agencies are reasonably in the mainstream.

I'm not looking for an argument on this point as I think it irrelevant. The issue here is not the exact timing but that there will be/was a peak of production in my lifetime. And so I prefer to move on to the next question of the nature of the sensible response - both personal and society-wide.

I've watched the debate develop and I've seen the mainstream position shifting - both what people say in public and what they will confide in private. Personally, I don't need proof of the fact. And I don't even feel a need to prove it to others. I offer some sources and people can make their own calls.

OK, a certain degree of debate over sources is healthy. But not to the point it derails discussion. I do in fact talk to/listen to people on both sides of the divide.

No doubt, birds of a feather flock together. Peak uranium is even more crackpotish than peak oil.

The idea that there will be a peak for uranium too is not crackpot. The estimate of when it will bite is the question.

I agree it seems far off.

For balance, here are some industry views...

http://www.businessinsider.com/uranium-supplies-are-likely-to-be-adequate-until-2020-2009-12

http://www.world-nuclear.org/reference/default.aspx?id=294&terms=peak+uranium

(Though amusingly, the World Nuclear Association does believe in peak oil: "There are, however, examples such as oil, where prices and sophisticated projections may now be indicating that proven reserves are indeed beginning to run out.)

Of course, uranium mining and nuclear reactors presume a functioning international economy. So transitioning from oil remains the big if.

A consensus view I would be happy with is that if we have to worry about peak uranium, then things are not going too bad with the world.

That's what gets passionate and gullible people to buy books. That's why the title of the thread isn't just "Hubber's Peak" but rather "Hubbert's Peak. The oil crash." [emphasis added]

Fair enough. Apocalypse sells. Utopia too. We've seen it before. Silent Spring, the ozone layer, the millenium bug.

Luckily these are also some examples where people did wake up and react. Even if the millenium bug was way over-hyped (people getting worried about their toasters), there were things that needed to get fixed.

Ok, so are you saying you moved from London to NZ because of peak oil?

I'm not sure what you are driving at here. But I did move primarily because of climate change/population growth. There were a bunch of other good reasons as well. Like wanting a change.

But I was in a very comfortable position where I was, and there were many interesting countries I could have chosen as a next stop. Yet I made what I felt was an optimal long-term decision on the grounds that a bottleneck would develop (I have kids, and that was the decisive factor really).

 

[apeiron]

Good news from the other side...

http://www.economist.com/business-finance/displaystory.cfm?story_id=15661889

Now North America has an unforeseen surfeit of natural gas. The United States’ purchases of LNG have dwindled. It has enough gas under its soil to inspire dreams of self-sufficiency. Other parts of the world may also be sitting on lots of gas. Those in the vanguard of this global gas revolution say it will transform the battle against carbon, threaten coal’s domination of electricity generation and, by dramatically reducing the power of exporters of oil and conventional gas, turn the geopolitics of energy on its head.

Shale is almost ubiquitous, so in theory North America’s success can be repeated elsewhere. How plentiful unconventional resources might be in other regions, however, is far from established. The International Energy Agency (IEA) estimates the global total to be 921 trillion cubic metres (see chart 2), more than five times proven conventional reserves. Some think there is far more. No one will really know until companies explore and drill.

An age of plenty for gas consumers and of worry for conventional-gas producers thus seems to be dawning. But two factors could reverse the picture again. The first surrounds the uncertainty about how fruitful shale exploration will be outside North America. A clearer understanding of the geology will emerge from pilot wells in the coming months. Second, there are reasons for caution above ground, too. Despite natural gas’s greener credentials than oil’s or coal’s, shale drilling has critics among environmentalists, who worry that water sources will be poisoned and landscapes despoiled.

 

[Chi Meson]

Presumably, that's what has people buying houses in the country and living off the grid,

In James Howard Kunstler's book he suggests that communities with working farmland (or easily recoverable farmland), and access to railway will survive==>thrive as the economy recovers from the glut of "cheap oil."

So going "off grid" by one's self in the faraway country is not likely to be the best bet. Some people a re still thinking "crash" as in "brick wall." It's much more likely to be a "slow let down," like sitting on a huge air-mattress that has a slow leak.

[Full disclosure: I share Kunstler's opinion on architecture; I believe that he 50--75%-correctly predicted the economic crash of 07-08 (better than pure chance, but not "spot on"--he predicted it to be a year earlier, and a quite a bit worse); I think that his economic prediction for the future is probably also 50--75% correct (and he doesn't predict a "neo stone-age," but rather a "neo agrarian age" in which people will need to relearn how to grow potatoes). His rants start off with reason, but he slips into crackpottery when he's not being careful; you can pick out a lot of "good points" amidst his pejorative frothing, much like many sharply opinionated members here; he's anti-anyparty but dislikes republicans more; I think he probably "punches up" the dire consequences a bit to sell his books, but he fundamentally believes in what he writes. Final assessment: I think I'd have him over for dinner, but he ain't an overnight guest.]

 

[apeiron]

Swedish report critiquing the official IEA World Energy Outlook...

Using the production parameter, depletion-rate-of-recoverable-resources, we have analyzed the four crude oil fractions and found that the 75 Mb/d of crude oil production forecast for the year 2030 appears significantly overstated, and is more likely to be in the region of 55 Mb/d. Moreover, analysis of the other fractions strongly suggests lower than expected production levels. In total, our analysis points to a world oil supply in 2030 of 75 Mb/d, some 26 Mb/d lower than the IEA predicts.

In all our projections, future oil production by 2030 will have decreased from present levels. The world appears most likely to have passed the peak of global oil production and to have entered the descent phase. If this is the case, then the world has reached the “Peak of the Oil Age”.

http://www.tsl.uu.se/uhdsg/Publications/PeakOilAge.pdf

Another interesting article that highlights another reason why production actually peaks - the impact of conflict as constraints approach.

But that is not accounting for politics and the rise of the "resource nationalism" that has made the multinationals persona non grata in some of the great oil-bearing regions. BP was among the companies that saw its assets seized in a US$30 billion ($42 billion) grab by President Hugo Chavez in Venezuela during 2007, while Exxon resorted to Britain's High Court to try to wrestle back its interests there.

Developing countries such as Venezuela, Nigeria and Russia have increasingly been moving down the road to self-reliance, developing their own state-owned firms at the expense of international players. But this can mean that Western know-how and finance is sacrificed, slowing down the rate of oil development if not losing new reserves completely.

BP, Shell and Exxon have all had tussles with the Kremlin over their oil holdings in Russia, while Shell has found the Government in Nigeria increasingly truculent over attempts to reopen the Niger Delta oil wells shut down because of guerrilla action.

The Western firms see part of their salvation coming from being able to enter markets where they have previously been barred, such as Iraq. Both BP and Exxon have signed recent deals there on terms so tight they would have been inconceivable a few years ago.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10612594&pnum=0

 

[apeiron]

Peak coal - something else to think about...

Peak coal production could hit around 2030.

http://www.tsl.uu.se/uhdsg/Publications/Coalarticle.pdf

http://www.abc.net.au/science/articles/2009/05/13/2569143.htm

 

[apeiron]

Peak copper as well...

http://europe.theoildrum.com/node/6307

Of course modelling for a substitutable and reusable mineral like copper is a little different than for oil or coal, but the exercise is worth it if we want to understand the various constraints to economic growth.

The logistic curve does seem a better fit for the future than unconstrained exponentials, no matter how much technological ingenuity we may credit humans with.

 

[aquitaine]

No doubt, birds of a feather flock together. Peak uranium is even more crackpotish than peak oil. It was cited earlier in the thread with an utterly absurd claim, but the reality is that we have a relative eternity's worth of nuclear fuel available compared to what's left of our oil. Hundreds of years at the very least. No reputable scientist sees a uranium production problem in the next century. Heck, in the US, we're already storing as "waste" enough perfectly good nuclear fuel to keep our existing plants going for another couple of centuries.

Indeed, as well as create more nuclear fuel through breeder reactors. Uranium is a very common element, a little bit of it is in everything. IIRC, the Japanese even found it on the moon. If that isn't enough we can always switch to Thorium, which is even more bountiful.

and BTW, a further blow to "PO is the end of the world" theory, recently we discovered a way to make plastic without crude oil. PO being the end? Sure doesn't look that way to me.

 

[apeiron]

and BTW, a further blow to "PO is the end of the world" theory, recently we discovered a way to make plastic without crude oil. PO being the end? Sure doesn't look that way to me.

But this is plastic from natural gas. So part of the peak oil story still.

Gas buys extra time. But how many years do you think that is?

 

[aquitaine]

But this is plastic from natural gas. So part of the peak oil story still.

Gas buys extra time. But how many years do you think that is?

They also said it can be modified to use bio fuels. Granted, bio fuels will not replace gasoline or diesel in vehicles, but the amount required to make plastics is significantly less and plastic can be recycled, further cutting the required amount down.

 

[apeiron]

Peak asphalt!...where the EROEI hits the road

http://europe.theoildrum.com/node/6349

The problem, as usual, is not one of quantity, but one of energy . With minerals, we are not running out of anything except of the energy needed for extraction. It is the principle that I called the universal mining machine. Bitumen doesn't seem to be an exception; we are not running out of bitumen, but we have increasing problems in being able to afford it; just as with a lot of other minerals. For this reason, the proposal of substituting conventional bitumen with products not coming from crude oil doesn't appear to be very practical. There has been talk of "bioasphalt;"

 

[russ_watters]

Here's a former peak oil catastrophe advocate who now believes the rising price of oil will cause the law supply and demand to take over and limit demand without social upheval.

What has changed is his opinion of the price impact and implications for fuel consumption after the spike of July 2008 to nearly $150 a barrel was followed by world economic recession, a deep drop in fuel use and a crash in oil futures to just above $30 in December 2008.

"I have changed my point of view about future prices," said Campbell, who used to think the peak in conventional oil production, which he believes happened in 2005, would lead to a relentless price surge.

Instead, the record rally led to a peak in demand in the developed world.

"Peak oil drives prices up in the first place. It has its own mechanism. We're sort of at peak demand right now," Campbell told Reuters from his home in the village of Ballydehob, West Cork. "I think presently the price limit is about $100."

For those who have painted alarming pictures of civil unrest as the world economy is forced to move away from conventional fuel and pay high prices for it in the interim, an inbuilt price mechanism to limit demand and move the world to other forms of energy should be a good thing.

"We have no alternative but to go green," Campbell said.

But he does not think reduced demand is enough to offset the gravity of peaking supply. He still sees a possibility of social anger as millions are forced to change their lifestyles in a too-sudden structural shift from economic growth driven by cheap conventional fuel.

http://www.reuters.com/article/idUSTRE63539420100406

While I applaud his open mindedness, how did he not consider what is a basic economics 101 issue before now?

 

[Office_Shredder]

While I applaud his open mindedness, how did he not consider what is a basic economics 101 issue before now?

Historically when natural resources are limited supply and demand doesn't regulate the usage economically

 

[apeiron]

Here's a former peak oil catastrophe advocate who now believes the rising price of oil will cause the law supply and demand to take over and limit demand without social upheval.
http://www.reuters.com/article/idUSTRE63539420100406

While I applaud his open mindedness, how did he not consider what is a basic economics 101 issue before now?

That is not exactly what the article quotes Campbell as saying. For example...

But he does not think reduced demand is enough to offset the gravity of peaking supply. He still sees a possibility of social anger as millions are forced to change their lifestyles in a too-sudden structural shift from economic growth driven by cheap conventional fuel.

So what is being said here?

1) The era of cheap oil has peaked, or is very close to peaking.

2) The EROEI of known alternatives are not in the same ballpark (though maybe we will crack fusion, do something magical with nanotechnology, etc).

3) This is not a classic Economics 101 supply and demand equilbrium equation as we are talking about a finite resource and a supply inelasticity (with no easy substitutions, see 2).

4) The unknown here - as Campbell is "admitting" - boils down to how people may respond to an inevitable fundamental change.

Will they move smoothly towards a power-down scenario where they kiss goodbye to the old consumerism that never really made them happy in the first place? (And I really hope that is the case, hence my warm feelings for Transition Towns, Oooby, Permaculture and other nascent social responses).

Or will people fight to preserve the growth escalator they have become so used to for the past three generations? (Or in China, India, etc, just getting that first taste for).

Economics 101 does not teach energy descent - how to run an economy smoothly in the reverse de-growth mode. I doubt you even get to study that in 401.

 

[russ_watters]

Historically when natural resources are limited supply and demand doesn't regulate the usage economically

Um...is that supposed to be facetious or was that just a poor choice of words?

 

[russ_watters]

That is not exactly what the article quotes Campbell as saying.

It's a paraphrase, not a quote, so I guess...yeah, you're right! But it is exactly what he meant.

For example...

1) The era of cheap oil has peaked, or is very close to peaking.

Yes, he says that - he actually believes it was 2005. But even that characterization "the era of cheap oil" is different from the more straightforward supply peak that peak oil used to be about.

2) The EROEI of known alternatives are not in the same ballpark (though maybe we will crack fusion, do something magical with nanotechnology, etc).

He doesn't mention that and in any case, I don't agree. Regular nuclear power is cheap precisely because it is high output for the input - and would be even a lot cheaper still if we didn't have fake political barriers. Regular nuclear power could provide for the vast majority of our energy needs, assuming a phase-in conversion of a large fraction of our cars to electric. The fusion and nanotechnology quip - that's just technobabble/non sequitur.

3) This is not a classic Economics 101 supply and demand equilbrium equation as we are talking about a finite resource and a supply inelasticity (with no easy substitutions, see 2).

What it means is that the doom and gloom scenario assumes/requires an extremely low price elasticity of supply and the evidence from the recent recession implies a more reasonable level of elasticity.

Will they move smoothly towards a power-down scenario where they kiss goodbye to the old consumerism that never really made them happy in the first place? (And I really hope that is the case, hence my warm feelings for Transition Towns, Oooby, Permaculture and other nascent social responses).

That's all non sequitur. It has nothing to do with energy. I have a nuclear power plant 5 miles from my house and am confident I'll always have the power I need to run my computer and big-screen home theater system. If a lack of oil means I have to buy an electric car in a few years, so be it. I'll be fine. You think that's "consumerism" and a bad thing? Fine, but it doesn't have any bearing here.

Economics 101 does not teach energy descent - how to run an economy smoothly in the reverse de-growth mode. I doubt you even get to study that in 401.

This "reverse de-growth mode" is the doom-and-gloom, collapse of civilization type scenario that is the essence of "Peak Oil" and is now what he is saying he doesn't believe will happen! You can't learn it in an economics class because it isn't economics, it's just fearmongering. But you can learn why it is just fearmongering by understanding elasticity in your econ 101 class.

I don't see this change of position to be a very good marketing strategy. The decrease in fearmongering will result in a decrease in demand for books on peak oil! Though perhaps the strategy works as a hedge against having to keep pushing back the date of peak oil.

 

[Office_Shredder]

Um...is that supposed to be facetious or was that just a poor choice of words?

I'm referring to beyond economic activity... you know, war.

 

[apeiron]

It's a paraphrase, not a quote, so I guess...yeah, you're right! But it is exactly what he meant.

I don't think you are accurately paraphrasing what is being said (but then the article is badly written and we could analyse its true meaning endlessly).

But it seems clear enough that Campbell is just saying that the run-up in oil prices by speculators was so sharp that it punctured the economy and led to the credit crunch - all the wild derivative bets unravelling. So this knocked consumption, and thus prices, on its heels again.

De-growth in other words. Every peak oiler indeed says this. And they say as economic activity takes off again, we will again be banging our heads on the ceiling.

At that point, we either need permanent degrowth or energy substitution. Coal and nuclear maybe some people's choice for "alternatives".

I happen to live around 5000 miles from the nearest nuclear power plant. That may colour my views too.

 

[apeiron]

What the U.S. Joint Forces Command’s Joint Operating Environment (JOE) 2010 thinks about peak oil...

Summary - The immediate issue is a lack of investment in production that will create oil shortage and price spikes (thus economic problems and international tensions) within a few years.

Longer term (next decade), not much prospect of the large new fields that will be needed to meet current growth in demand. Any production increases will have to be environmentally "dirty".

The big question is why aren't oil companies investing in more production? Is it just that they were so sensitive to the credit crunch that they were forced to shelve investment?

Or is it that they can see down the road and are asking why bother in pumping out what's left even faster when a more intelligent business strategy is to stick with current number of oil rigs and make more profit as prices rise?

Energy Summary

To generate the energy required worldwide by the 2030s would require us to find an additional 1.4 MBD every year until then.

During the next twenty-five years, coal, oil, and natural gas will remain indispensable to meet energy requirements. The discovery rate for new petroleum and gas fields over the past two decades (with the possible exception of Brazil) provides little reason for optimism that future efforts will find major new fields.

At present, investment in oil production is only beginning to pick up, with the result that production could reach a prolonged plateau. By 2030, the world will require production of 118 MBD, but energy producers may only be producing 100 MBD unless there are major changes in current investment and drilling capacity.

By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD.

http://www.peakoil.net/files/JOE2010.pdf