Peak Oil
Frequent commenter Frank Eggers pushes back on my theory that the peak oil theory is wrong. He writes, Rather, the time table is much longer than originally thought. Instead of being 20 years or so, it may be 200 years or so. Obviously that has significant implications.
Yes, and those implications are that peak oil is meaningless. If we still have a civilization here in 50 years, there is no doubt that fossil fuels will have lost all utility to us (or what’s left of us).
Whether the peak oil theory is “wrong” or “meaningless” is itself a meaningless distinction.
@ Craig – I read your Post on the Peak Oil and your conversation with the late Mr Simmons.
I had the blessing of meeting him in Denver in 2009 at a ASPO gathering.
His book Twilight in the Desert has much Prophetic truths but as you said the data for Post Foreign Oil fields is lacking good data sets and has many unknowns.
Yes the Shale finds and new fields here and in some Latin American countries , Canada’s Tar Sands and the continued prolific production from the Middle East has flooded the market. So prices are down , part of that is world economy and some is due to end use efficiency.
Also distributed solar and wind have reduced diesel generation in the under developed world. The aggregated impact is a surplus and lower prices.
My challenge is that the concept of Peak Oil is much more than just the supply part. Here are some discussion points that should not be discounted.
It is about the economics of maintaining supply and the capacity of infrastructure to continue the industry on the scale we have been accustomed to etc.
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The EROEI continues to decline especially with the Shale and Deep Water plays. Depletion rates for Shale are excessively steep and short lived.
Continuous field development requires a strong supply of capital investment. Rapid depletion rates require ongoing drilling and new resource inventory banking( storage).
Many of the new resources have higher extraction costs – the cost curve is not going down at the scale that the industry historically was always able to do. The decline in EROEI gets the attention of the banking under writing sector so cost of capital may rise over time. They know the depletion rates and it is concerning in respect to RISK!
Granted, There are some legacy Oil Co that are innovating technical solutions to address high costs associated with water usage and treatment of produced by product waters. There is a trend with recycling the waters and reducing costs and re using the water. ( Positive Moves) This is still in its infancy but is a serious attempt by certain companies to be able to make money when oil prices are around $ 35 per barrel. The low price Cut Both Ways , they drive innovation or results in bankruptcy.
So Peak Oil discussion is not over and maybe Frank is accurate by saying it will not all be gone for 200 years. As simmons said there will always be Oil but what is accessible? Economically Recoverable etc.
I don’t think economically recoverable Oil will last that long. I tend to go with Shell Oil Co who predicts that by 2100 the World will use like 12 % of its energy from Oil. I will check with my files to get the exact number.
They predict that Solar will be over 60 % of the Worlds main energy driver by then. The issue I have with them is that they say that Oil is dominant til 2050 then the big cut back etc.
Like you I tend to think the climate issue if ignored that long will spell a dark dark and painful future for those behind us. We dont have that kind of time. The drought s are causing migrations levels now and all the human misery related.
It is note worthy that Saudi Arabia s Ghwar Field the Mother lode of the World began pumping over 12,000 barrels of sea water a day into its declining fields to force remaining oil to the surface. This takes lots of energy to do this on a daily basis.
So the economics are changing. Look at Venezuela and Brazil both have uneconomic reserves given current global prices etc. Yes we do have adequate supplies for the time being.
Peak Oil a complex and fascinating topic. Its to Be Determined perhaps Peak Oil is a Series of interconnected events that in the aggregate ( supply , finance , economic, geo politics etc.) combine to change the supply equation.
Its simplistic to say there is No Issue.
Craig, you need to go back and watch that Joe Romm video again.
The oil in the ground is getting more expensive to get out of the ground and the environmental risks associated with the extraction increases the harder the oil is to get out of the ground.
The time frame is all that is changed.
Of course the new administration is going to take down any environmental protections that Obama put in place, but still the economic prospects of oil are not good long term.
I don’t disagree with any of this. In fact, that’s my point, I.e., oil is not disappearing, but it’s pricing itself out of the market.
Craig pleased that you are not adapting the simple slogan that Peak Oil Debate is resolved and over.
Its more complex and Bruce is correct re reduced profitability of the entire oil / gas extraction process.
I added more concepts that are not just theories but are playing out in record bankruptcies within the industry and more than a few Banks or Financial Groups have lost a Ton of Money.
Wait till the large numbers of Junk Bonds sold to underwrite extraction go under. These things are happening now.
In my other Post I mentioned Shell OIL Co year 2100 predictions
Here they are will be interesting to see how close or far off things are in 2100.
Solar 37.7 % – think this is Low estimate
Bio Fuel 9.5 %
Oil still 10.1 % think there is some Bias here ??
WIND IS 8.4 % may be low
Natural Gas 7.5 %
NUCLEAR ONLY GETS 6.3 % Interesting
Geo thermal 4.4 % – again Low
Coal 3.9 % I say high estimate My wish is 0 – my Bias LOL
Hydro comes in last at 2.3 % – perhaps the droughts dry up much of the Reservoirs so Shell is actually saying in a Indirect manner that Global Warming and droughts are in store for the World!
Tidal Power does not get a ranking – perhaps a Oversight of minds clouded by thick carbon ! UK and Scotland begin deployment of the first megawatt and half units in a few months. T B D if valid.
Maybe this stimulates some conversation The LENs is a long read pitting Oceans ( green & renewable s) against the Mountains ( oil, carbon coal gas , entrenched transportation systems, Etc.) you can google it and download from Shell. Lots of conflicting arguments for sure and trade offs.
All Forecasts have their shortcomings and no matter the level of expertise the number of External Variables involved bakes in errors.
It would be Wonderful if some of us are around in 2100 to measure out just how close to reality these forecasts by Shell Oil are. ???TBD
It is Noteworthy that Shell was a leader like BP in the early development of solar pv 0 plus years ago; but they both dropped it! They could have Owned it All!
One can only wonder if there is real Gravitas in these large Co! We do know there are Excessively Large Paychecks that reward them for Status quo!
Enjoy