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Peak Oil

What to do as oil peaks out
A geologist as amiable guide

Jane Holtz Kay, CS Monitor
“Hubbert’s Peak,” the point on the graph that marks the apex of world oil production, has dropped below its zenith. And, for Americans dependent on their economy’s lifeblood, the news goes against the grain of our optimistic belief in the eternal More. Whether you consider the shrinking of that commodity as bringing grim times for our manufacturing, driving, consuming nation, or, perversely, good times for a planet overrun with the greenhouse gases it produces, one thing is sure: There are life-altering changes ahead.

“Beyond Oil: The View from Hubbert’s Peak” is an attempt by Kenneth S. Deffeyes to chart and interpret the alternatives.

A geologist who “grew up in the oil patch” and worked in the “awl bidness,” to quote his westernized spelling, Deffeyes is an amiable guide. With a consultant-cum-Rotarian’s ease, he explores the angst from the downslide of geologist M. King Hubbert’s predicted high point of production. “Oilfield trash, and proud of it,” says the bumper sticker on the car of this oil man with the Princeton PhD. And the same flip and practiced approach characterizes his insider-outsider text
(17 May 2005)

Andrew McKillop: Open shift to the Euro would further lock-in higher oil prices oil industry commentarist Andrew McKillop writes: The US economy attained it highest-ever postwar annual growth of real GDP, achieving what today would be the impossible all-year rate of 7.5%, in the Reagan re-election year of 1984.

At the time, in dollars of 2004 corrected for inflation and purchasing power parity, the oil price range for daily traded volume crudes was about US$55-68/barrel.

Today, with oil prices that show extreme volatility -­ likely because of underlying physical shortage -­ but are close to $50/bbl, US economic growth on an annual base remains above 3.75%, and achieved more than 4.5% on an annualized base, in 2004, with oil prices that regularly exceeded $55/bbl.

World economic growth in 2004, on IMF data published in early 2005, was the highest for over 15 years, at about 4.8%, despite -­ or because of — oil prices attaining $55/bbl, also entraining record high prices for most metals, many minerals, and some agro-commodities.

As oil prices have increased, economic growth rates in all regions of the world except Europe have not fallen, but significantly increased through 2004. Both in oil-importing low income countries of Africa, and oil-importing countries of Latin America (especially Brazil) economic growth in 2004 strongly rebounded from the lows of 2002-2003, surprising many analysts. World merchandise trade growth in 2004 was running at its highest rate for over 15 years.
(17 May 2005)

PO Conference in Sweden May 23
Global Oil Reserves-Hopes and Reality
Uppsala University
Monday 23 May, 2005, Ångström laboratory, Uppsala University, Uppsala, Sweden

Keynote lectures by Matthew Simmons and Robert Hirsch ( Program ). The program starts at 13:00 Central European Time and can been seen live ( Streaming ).

We have now consumed the first half of the global crude oil reserves and we are at the doorstep to the second part of the oil age. Demand is increasing and oilfield is aging, discovery rates are dropping and oil sand and other alternatives are discussed.

Matthew Simmons, Simmons & Company International, Huston, Texas, USA, has in many years been an investor in the oil industry, but also energy adviser to president Bush. Coming back from his visit to Uppsala his new book “Twilight in the Desert” will be released, and it is a privilege for us to get a presentation prior the publication.

Dr. Robert L. Hirsch is a Senior Energy Program Advisor has served on numerous advisory committees. Recently he has completed a study for the U.S. Department of Energy analyzing viable technologies to mitigate oil shortages associated with the upcoming peaking of world oil production.

At the seminar we will also present research work carried out at Uppsala University by the Uppsala Hydrocarbon Depletion Study Group. The Royal Swedish Academy of Sciences has appointed an energy group chaired by professor Sven Kullander. Information about the work will be given.
(17 May 2005)

Book Review of The Long Emergency

Raise the Hammer (community blog for Hamilton, Canada)
In his new book, The Long Emergency, Kunstler turns the same highly developed sense of outrage that carried his caustic exploration of suburbia and its discontents through the crisis that peak oil may wreak on an unsuspecting world.
(16 May 2005)

How a clever world could self-destruct
Paul Sheehan, Sydney Morning Herald
It would be useful if, in two weeks, the Prime Minister attended a
keynote address on May 29 at the Sydney Writers’ Festival. It will be
delivered by the American geographer Professor Jared Diamond, a Pulitzer
Prize-winning author whose new book, /Collapse/, charts the history of
civilisation collapse caused by environmental failure. Diamond sees
history repeating itself. Australia gets an entire chapter because of
its growing and unsustainable divide between consumer wealth and
environmental poverty.

His warning connects to another element in the Howard legacy, the strong
relationship with President George Bush. Whatever one may think of the
Bush imperium, the most disturbing aspect of his Administration is its
attitude to global climate change. Against an overwhelming scientific
consensus, the Bush Administration clings to the argument that the
massive chain reactions in the global climate system may not have been
triggered by human intervention. So it’s business as usual.

For the past three weeks, /The New Yorker,/ one of the best and most
carefully checked magazines in the world, has run a series of articles
by Elizabeth Kolbert about the chain reactions now under way in the
global climate system. Rather than try to summarise the series I quote
its final paragraph, and ultimate conclusion: “It may seem impossible to
imagine that a technologically advanced society could choose, in
essence, to destroy itself, but that is what we are now in the process
of doing.”
(May 15)

Energy-related News

What drives support for this torturer
Oil and gas ensure that the US backs the Uzbek dictator to the hilt

Craig Murray, Guardian (UK)
by Craig Murray (British ambassador to Uzbekistan from 2002 to 2004)
The bodies of hundreds of pro-democracy protesters in Uzbekistan are scarcely cold, and already the White House is looking for ways to dismiss them. The White House spokesman Scott McClellan said those shot dead in the city of Andijan included “Islamic terrorists” offering armed resistance. They should, McClellan insists, seek democratic government “through peaceful means, not through violence”.

But how? This is not Georgia, Ukraine or even Kyrgyzstan. There, the opposition parties could fight elections. The results were fixed, but the opportunity to propagate their message brought change. In Uzbek elections on December 26, the opposition was not allowed to take part at all

The airbase opened by the US at Khanabad is not essential to operations in Afghanistan, its claimed raison d’être. It has a more crucial role as the easternmost of Donald Rumsfeld’s “lily pads” – air bases surrounding the “wider Middle East”, by which the Pentagon means the belt of oil and gas fields stretching from the Middle East through the Caucasus and central Asia. A key component of this strategic jigsaw fell into place this spring when US firms were contracted to build a pipeline to bring central Asia’s hydrocarbons out through Afghanistan to the Arabian sea. That strategic interest explains the recent signature of the US-Afghan strategic partnership agreement, as well as Bush’s strong support for Karimov.
(16 May 2005)

Bolivians stage huge energy rally
Thousands of protesters in Bolivia have marched through the main city of
La Paz to pressure the president to toughen a controversial new energy
bill. Police prevented the mainly indigenous demonstrators from entering
the central square. There were a few clashes, but the march was largely

Elsewhere, other protesters set up roadblocks on several key highways.
President Carlos Mesa refuses to sign the bill into law because he
considers the level of taxes unworkable. The law, already approved by
Congress, would raise the taxes paid by foreign energy firms to 50% of
their revenues.
(May 16)

Ecuador Gets Chávez’d
Greg Palast, The Nation
George Bush has someone new to hate. Only twenty-four hours after
Ecuador’s new president took his oath of office, he was hit by a
diplomatic cruise missile fired all the way from Lithuania by
Condoleezza Rice, then wandering about Eastern Europe spreading
“democracy.” Condi called for “a constitutional process to get to
elections,” which came as a bit of a shock to the man who’d already been
constitutionally elected, Alfredo Palacio.

What had Palacio done to get our Secretary of State’s political knickers
in a twist? It’s the oil–and the bonds. This nation of only 13 million
souls at the world’s belly button is rich, sitting on 4.4 billion
barrels of known oil reserves, and probably much more. Yet 60 percent of
its citizens live in brutal poverty; a lucky minority earn the “minimum”
wage of $153 a month.
(May 11)

Australia, East Timor strike oil, gas deal
Bob Burton, Asia Times
After eighteen months of often tense discussions, officials from the
governments of Australia and East Timor reached an agreement last week
on the division of revenues from oil and gas deposits in the
mineral-rich waters between the two countries.

While details of the agreement are sketchy, campaigners supporting East
Timor’s original bid for the adoption of a boundary halfway between the
two countries, which is the international norm, fear that the final deal
will fall well short of what Asia’s poorest nation is legally entitled to.
(May 17)

Arctic oil search moves to new turf, new controversies

Yereth Rosen, Christian Science Monitor
ANCHORAGE, ALASKA – One is a long-protected portion of Arctic Alaska where a vast freshwater lake is edged by marshes that draw migrating birds from as far as Mexico and Russia. The other is a national wildlife refuge straddling the Arctic Circle, a watery haven for moose, furry mammals, and waterfowl.

But underneath both lie what may be some of the largest untapped pools of onshore oil and natural gas in the US. As a result, the two sites represent one of the next crucial frontiers in the nation’s expanding energy wars.

In many respects, the fight quietly emerging over the two areas – Teshekpuk Lake and the Yukon Flats National Wildlife Refuge – parallels the protracted battle over the Arctic National Wildlife Refuge (ANWR). It is energy versus the environment, with elements of caribou and molting birds and native American culture mixed in.
(17 May 2005)
Ed: This article is fourth in a series on the “Western Energy Boom.”

Water for oil? Oil and Gas drilling could contaminate precious aquifers
V.B. Price, The Albuquerque Tribune
An arid state, stricken by regular but unpredictable droughts, New
Mexico has often found itself indifferent to the contamination of
precious aquifers in the name of economic development. In New Mexico,
pure underground water always trumps the dangers of exploring for oil
and gas.

The tragedy, of course, is that once groundwater is polluted in a
certain area, it is very difficult and extremely costly to clean. If the
contamination reaches an aquifer, it is unlikely it will ever be potable

Scotland Nuclear: Revealed – the safety ‘failures’ at Dounreay
Rob Edwards, Sunday Herald
THE nuclear complex at Dounreay has suffered more than 250 safety
“failures” in the past six years, according to documents released by the
Scottish Environment Protection Agency (Sepa).
Many of the leaks, spills and equipment breakdowns have never been
reported before, and raise concerns that Dounreay’s operator, the UK
Atomic Energy Authority (UKAEA), has failed to overcome the poor safety
practices of the past.

In response to a request under the Freedom of Information Act, Sepa has
provided the Sunday Herald with a 26-page list summarising every
incident at Dounreay. It reveals that, since 1999, there have been an
average of 40 problems a year, with the highest number, 53, in 2004.
They include the radioactive contamination of whelks, winkles, rabbits,
concrete, soil, water, air and beaches. Samplers monitoring for tritium
and other radioactive emissions have frequently been reported as being

University working on ‘ultra-clean coal’
Press Release, University of Nottingham
Engineers in Nottingham are developing ultra-clean coal that they claim
could make power generation 50% more efficient and reduce carbon dioxide
emissions by a third. The process would chemically leach unwanted minerals from the coal
before combustion.
(May 10)

Saudi oil minister comments on oil supply

AP (via Business Week)
Saudi Arabian Oil Minister Ali Al-Naimi said Tuesday that the kingdom has plenty of oil in the ground to meet global demand for now, but acknowledged that the perception of a tight market has contributed to higher prices.

“I stand here to tell you that Saudi Arabian reserves are plentiful, and we stand ready to raise output as the market dictates,” Naimi said in a speech here.

“Very high or unstable prices are not in the interest of producers,” he said, adding that oil producers also suffer when the world economy slows.
(17 May 2005)

North Sea oil production continues decline
Islamic Republic News Agency
Oil production from the British sector of the North Sea continued its
decline in February, falling by 13 per cent compared with the same month
last year.

According to the latest monthly index from the Royal Bank of Scotland,
oil production was down to an average of just over 1.7 million barrels
per day (mbpd) from nearly 2 mbpd 12 months ago.
(May 14)

IEA: World oil demand growth slows
Reuters, CNN Money
Weakening economic growth and inflated fuel costs slowed oil demand
growth in the world’s biggest energy importing regions in the first
quarter, an energy advisory group said Wednesday.
Incremental demand in China, Europe and the United States was less than
expected for the quarter, said the International Energy Agency, adviser
on energy to 26 industrialized nations, in its monthly Oil Market Report.

China Shakes Off IEA Forecast Of Slow Oil Growth
Yee Kai Pin, Schlumberger
China has issued a note of caution to the oil market: ignore the
country’s oil thirst at your own peril.

Barely a week after the International Energy Agency cut its demand
growth forecast for China, the country Monday posted a record-high crude
oil import figure of 12.25 million metric tons for April, or the
equivalent of 2.99 million barrels a day.

This is up a sizable 22.5% against the same month last year…
(May 16)

UK City hedge funds head for domino collapse
Peter Koenig and Louise Armitstead, Times Online
BAD investments by some of the biggest hedge funds in London have
triggered unprecedented losses, record demands for money back and talk
of a death spiral weighing heavily on stocks and bonds.

“What you’re seeing is like a run on the bank,” said Narayan Naik,
director of hedge-fund studies at the London Business School. “Selling
forces more selling and there’s a cascade effect.”
(May 15)

Religious Wrong: A Higher Power Informs the Republican Assault on the Environment
Glenn Scherer,
Americans need to pay attention to the winds of change blowing in from
the Arctic, then decide just how much Republican environmental policies
contradict clear messages relayed by our planet. Our leaders could be
viewing the world through a distorted lens, with their corporate
worldview and sometimes their fundamentalist Christian faith guiding
them to an interpretation of reality based not on scientific fact, but
on dogma.

US Rejects Airline Climate Taxes, EU Considers

Reuters via Planet Ark
BONN- The United States said on Monday it would be too harsh on airlines to tax emissions of heat-trapping gases from their planes, even though the European Union reaffirmed it was considering measures.

It would be “pretty difficult” to impose extra costs for airlines, said Harlan Watson, the senior US climate negotiator, at a UN meeting of government experts to discuss ways to rein in global warming.

“We are still recovering from September 11,” he said in response to a question, referring to the impact on the airline industry of the 2001 hijacked aircraft attacks in the United States.

The UN’s Intergovernmental Panel on Climate Change estimates that aviation causes 3.5 percent of global warming, widely blamed on human activities, and that the figure could rise to 15 percent by 2050.

In contrast with Watson, the European Commission expressed a willingness to include aviation, perhaps by imposing taxes or charges on aviation fuel or by widening the trading of emissions of heat-trapping gases like carbon dioxide.
(17 May 2005)

Solutions and Sustainability

How almost everyone in Kerala learned to read

Nachammai Raman, Christian Science Monitor
…Education in Kerala represents a success story that many nations might wish to emulate.

Kerala, located in the southern tip of India, is an agrarian state with a per capita income of only $265. Yet its literacy rate of 91 percent puts it closer to the United States than to any other Indian state. (The national literacy rate in India is 65 percent.)

Kerala was the first state in India to declare total literacy in one town in 1989, and subsequently, total literacy in a whole region in 1990. India’s National Literacy Mission declared total literacy in the whole state of Kerala on April 18, 1991.
(17 May 2005)

Kudzu root extract may curb excess drinking, researchers say

Virginia A. Smith, Knight Ridder Newspapers via Seattle Times
PHILADELPHIA — Kudzu, often reviled as “the vine that ate the South,” apparently brings something else to the table: a promising treatment for binge drinkers.

Researchers at Harvard-affiliated McLean Hospital outside Boston report that heavy drinkers who took a concentrated extract of kudzu root for one week downed a lot less beer: two or three brews in 1 ½ hours instead of their usual five or six.

“That’s a pretty powerful response,” said Scott Lukas, director of the hospital’s drug-abuse research lab and lead author of the study, which appeared in this month’s issue of Alcoholism: Clinical and Experimental Research.

Earlier kudzu studies have shown reduced consumption among alcohol-swilling monkeys, rats and hamsters. And while Lukas’ study is small and preliminary, it is the first to conclude what the Chinese have maintained for centuries: that compounds in the ancient vine, also known as ge-gen, can help problem drinkers imbibe less.
(17 May 2005)