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Peak Oil

Oil Forecasting Legend Paints Dire Energy Picture

David J. DesLauriers, Resource Investor
TORONTO ( — While Matt Simmons’ work is recently more widely publicized, Henry Groppe has been accurately forecasting oil price trends for the last 55 years. His latest views agree with those of Mr. Simmons, and paint a dire picture of a “permanently changed situation”. Indeed, Groppe says, “We think were headed for an energy crisis.”

Henry Groppe founded Groppe, Long & Littell in 1955. He has 55 years of experience in the oil, natural gas and petrochemical industries, including positions with Arabian American Oil Company, Dow Chemical, Monsanto and Texaco. He is a fellow of the American Institute of Chemical Engineers and has served as a charter member of the Texas Governor’s Energy Council and a director of the United States Energy Association (the U.S. member committee to the World Energy Council).

…Groppe says that we are at “a major turning point for world oil and north American natural gas.” According to this veteran, “We’ve been down a long road of exploration and exploitation and found everything easy. We’ve reached the point where all the major initial discoveries have reached their peaks and are declining. The newer ones are too small to offset it, and North American natural gas production has clearly peaked and is irreversibly declining. We think were at that turning point for world oil. From now on we’re in a new era where the key question is what prices will be required to cause consumption to decline to match an irreversible decline in supply?”

A critical question, and here Groppe seems to feel a little bit better about the situation than Simmons. “We think it requires a minimum of $50 for WTI to balance the system, and it will take time to determine how much above that is going to be required. And for the US natural gas market we think it will require prices in the range of $6.50 to $8.50 during the next 10 years to balance our supply demand system.”

At the same time, he reiterates that “for the first time in our history we are now at the point where the huge complex worldwide oil business is operating at total capacity, with every prospect of staying there from here on. Therefore any disruption in supply, or concern about disruption in supply, is going to create very very volatile surges in price on the upside.”
(6 June 2005)
The source is an investment newsletter with particular products and services to sell, so they may not be objective in their coverage.

Egosystems Threaten The Planet

Pierre Chomat, The Green Cross Optimist
It was probably the capacity of prehistoric humans to tame fire that allowed them to confront other stronger and more dangerous animal species, and, in the end, to prevail in the survival of the fittest. We are well aware that the homo sapiens wasn’t going to stop there. With fire, he could develop technologies which would secure his survival and, ultimately, his dominance. The fire became the man’s main weapon.

While nobody really knows how the mankind gained control over fire, one thing is certain: over the past few centuries, since the advent of the industrial revolution, the man has made a gigantic progress. The sheer amount of energy consumed by the man was enough to transform virtually all the ecosystems of the Earth into “egosystems”. Unlike in the ecosystem, where all the species coexist in a perfect equilibrium, the egosystem caters solely to the needs of the human species, or even a single individual. If we don’t stop this tendency, the whole Earth would soon turn into one enormous egosystem.

The life of a modern man is now very much energy-dependent. Able to extract now from one drop of oil, one bubble of natural gas or one small piece of coal an amount of energy equal to the daily capacity of a human body (about 40,000 Joules), the mankind employs these tiny fossil servants to implement its audacious projects which, barely one hundred years ago, seemed to be improbable. In fact, it is hardly possible to calculate the environmental cost even of such technological advantage as an airplane. When we fly from Europe to California, or vice versa, our plane consumes five hundred liters of fuel per passenger. A worker spends the same energy in 500,000 days! In terms of energy consumption, a flight from Europe to California does a better job than all the workers of France in one day.
Pierre Chomat was a manager in the French petroleum engineering industry and actively participated in the development of oil facilities in a number of countries in Europe, Africa and Asia. He is author of Oil Addiction: The World in Peril (a 25-page excerpt is available online).

Energy-related News

‘Stealth’ drilling threat to US park

Jamie Wilson, The Guardian
It’s called the Redneck Riviera – a thin string of islands with snow-white beaches off the coast of Mississippi that is home to an array of protected fish and birds, sea turtles and the Gulf of Mexico’s largest concentration of bottlenose dolphins. Officials have been so intent on protecting the federally designated wilderness area that even jetskis are banned from its sparkling blue waters.

But now the Gulf Islands National Seashore is under threat from what environmentalists are describing as a “stealth amendment” tucked away inside the 96-page emergency military spending bill signed by George Bush last month.

Written by the Republican senator Thad Cochran, the amendment allows the state of Mississippi to claim mineral rights under federal lands and allow drilling for natural gas under the national park. (1 June 2005)

Crisis warning as UK energy costs set to soar

Tim Webb, The Independent
Electricity and gas futures prices have hit record levels for this winter and are set to land Britain with Europe’s biggest energy bill.

Household electricity bills could rise by almost a fifth over the next 12 months while industrial users face a massive 60 per cent increase, according to the energy information consultancy EIC.

Industrial companies such as the chemicals manufacturer Ineos Chlor, which uses 1 per cent of the electricity generated in the UK, and industry representatives such as the Energy Intensive Users Group will meet officials from the Department of Trade and Industry on Wednesday to warn of the looming energy crisis.

Without government intervention, companies that use a lot of energy will be forced to cut production and lay off staff this winter, they will say. Last year the UK became a net importer of gas, and future gas prices for the first quarter of next year hit a record 70p per therm last week – twice as high as last year. (5 June 2005)

Fast economic growth fuels [China’s] energy crunch

China Daily
China’s economy will continue to be hampered by inadequate supplies of energy, even though the government is stepping up efforts to construct energy and transportation facilities.

Why? Because it will take a lengthy amount of time to complete such projects. China’s energy demand and supply situation, including the inefficient use of energy, and fast-economic growth, are the major factors contributing to China’s energy crisis.

Although China, on the whole, has large amounts of various sources of energy, the nation’s per capita reserves of those resources are less than the global average. For example, China’s arable land is about 40 per cent of the world’s average, and its supply of water is about one-fifth of the global average. China’s fast-economic growth has been applying increasing pressure on the nation’s already strapped supplies of energy and resources.
(6 June 2005)

Bolivian protesters vow to go on

Residents walk along a blocked road during a public transport strike in El Alto.
Recent protests have brought Bolivia to the brink of standstill
Demonstrators in Bolivia have rejected calls by the widely respected Catholic Church to end their protests.

Thousands are expected to march on the main city, La Paz, on Monday where they plan to hold a popular assembly. The country’s main roads remain blocked, affecting fuel provision to La Paz, in the fourth week of protests. The mainly left-wing and indigenous protesters are demanding nationalisation of the gas industry and constitutional reforms.
(6 June 2005)

How Saudi Arabia can double oil production

AME Info
Saudi oil production capacity could grow from its current 11 million b/d to over 23 million b/d to meet world demand according to Saudi Aramco’s President and Chief Executive Officer Abdallah S. Jumah, confounding sceptics who believe that the Kingdom may be approaching, or even past, peak production.
Ed: Time will tell…

Sellin’ Nukes, Dissin’ Wind

Kelpie Wilson, t r u t h o u t
Twenty years after Chernobyl, the pro-nuclear lobby has decided that it’s time to glue a happy face on nuclear power again. Simultaneous pro-nuclear public relations campaigns have plastered their briefs in the US and British media markets in the last couple of months. Time will tell whether they stick.

Jonathan Leake and Dan Box reported in New Statesman (The Nuclear Charm Offensive, 5/23/05) that a sudden flux of news articles about nuclear power right around the UK election last month was preceded by months of planning and the retainer of expensive PR consultants.

“Nothing had occurred politically,” they said. “There had been no reports, scandals, technical breakthroughs or new policies. What had happened was that a group of journalists had taken the bait offered them by a few canny public relations experts.”

…But the real choice is not between a high-powered but dangerous nuclear future and a solar-powered, modest granola lifestyle. We will never build enough nukes to replace the immense legacy of stored sunlight that is fossil fuels. We are inevitably headed toward a different, decentralized, low energy future. If there is a human impulse toward imperialism, there is an equally strong human impulse for democracy, and I am optimistic that the future will offer fewer opportunities for despots and more for democrats.

The real choice then is this: Do we saddle our descendents with the poison forever of nuclear contamination in our attempts to hang on to a doomed lifestyle? Or do we start learning to live lightly on the planet now, and spare the children?
(5 June 2005)

India readies itself for quantum jump in nuclear power

The Hindu
Amid its first 500 MWe reactor under construction at Kalpakkam, India is looking at its Fast Breeder Reactors (FBRs) to give the “quantum jump” to its nuclear power generation as it has a potential to generate 500,000 megawatts(MWe) of electricity, Atomic Energy Commission (AEC) Chairman Anil Kakodkar indicated today.

India has Fast Breeder Test Reactor of 40 MWth at Kalpakkam in Tamilnadu and construction is underway for the country’s first 500 MWe Reactor there. The design of Prototype Fast Breeder Reactor is in advanced stage and it is likely to be commissioned in 2010-2011.

This forms the second stage of India’s three-staged nuclear energy programme drafted targetting generation of 20,000 MWe of electricity by 2020, the AEC Chairman said during his interaction with the media on the sidelines of the 14th National Symposium on Environment which began at Osmania University here.

The thrust of the first stage of the “20000 MWe by 2020” programme is on Pressurised Heavy Water Reactor (PHWRs) to generate 10,000 MWe. Currently India has fourteen reactors in operation and eight other reactors under construction. (5 June 2005)

Advanced Nuclear Power Reactors

Uranium Information Centre (Australia) briefing paper
An industry briefing paper on ‘3rd generation’ nuclear reactors. See also Generation IV Nuclear Reactors (May 2005)

Nuclear waste debate is far from spent, industry says

Globe and Mail
Canada’s problem with nuclear waste is more easily defined than solved. A lot more easily. The harvest of the past four decades of nuclear power doesn’t seem that large — all the spent fuel rods would fill five hockey rinks to the level of the boards — but nobody has a clue what to do with the toxic stuff. (24 May 2005)
The article has now unfortunately been marked as “for subscribers only.”

Sweden’s nuclear waste headache

As Sweden begins decommissioning its nuclear power plants, time is running out to find a way to make 9,000 tonnes of spent nuclear fuel safe for the next 100,000 years (1 June 2005)

Man-made pesticides blamed for fall in male fertility over past 50 years

The Independent
Pesticides and other man-made chemicals may lower male fertility for at least four generations, according to new research. (3 June 2005)
Full article at Common Dreams

Solutions and Sustainability

Global-warming fight goes grass roots

Mark Sappenfield, Christian Science Monitor
SAN FRANCISCO – Sunday, when mayors from around the world gathered in this most environmentally aware of American cities to mark World Environment Day, they hoped to make a clear statement: Local communities – even more than nations – can be the pioneers of environmental reform. The choice of place and time could hardly have been more auspicious.

In recent months, it has become increasingly obvious that a critical mass is developing around perhaps the most nettlesome issue of modern American environmentalism – climate change – and that states, cities, and even some businesses are the ones taking the lead. While the Bush administration insists that human impact on climate change is far from certain, a growing number of policymakers disagree and are now taking decisive steps that the federal government has so far shunned.

…California can have a profound influence – not only on the environment, but on shaping public policy. As the 10th largest emitter of greenhouse gases in the world and a crucible of environmental policy, California’s decisions could again lay the groundwork for the future path of the entire nation.
(6 June 2005)
Also see It’s Not Just Eskimos in Bikinis from TomDispatch via Common Dreams.

U.N. Urges ‘Green’ Planning for Burgeoning Cities

David Fogarty, Reuters cia ENN
SINGAPORE — From Bondi Junction in Australia to Bindura in Zimbabwe, millions marked World Environment Day on Sunday by planting trees, picking up litter and staging rallies aimed at making cities cleaner and greener. By 2030, more than 60 percent of the world’s population will live in cities, up from almost half now and just a third in 1950, U.N. Secretary-General Kofi Annan said. The growth poses huge problems, ranging from clean water supplies to trash collection.

This year’s theme for World Environment Day is better “green” planning for the world’s burgeoning cities, many of them blighted by air pollution, fouled rivers and poor sanitation.

“Already, one of every three urban dwellers lives in a slum,” Annan said in a statement. “Let us create green cities,” he said, adding that unless planning improved, the U.N. goal of halving poverty by 2015 would not be met. Activists around the world mark June 5, the date of the first environmental summit in Stockholm in 1972, as the U.N.’s World Environment Day.
(6 June 2005)

The bloggers have all the best news

Owen Gibson, Guardian
In America, the first major study of web diaries reveals that they are shaping the political landscape like never before…

…researchers from the respected Pew Internet & American Life Project have conducted the first in-depth academic study of 40 of the biggest and most respected political blogs and the extent to which they influence and are influenced by other media.

…Its results show that bloggers are generally following another agenda, whether that of a political party or another medium, but also highlights the extent to which they can now influence the mainstream media on certain topics. “Sometimes blogs lead and can be very influential and other times they’re followers,” he says. While it remains too early to tell how the medium will develop, he says, the report offers an intriguing glimpse of how bloggers are starting to shape the US news agenda.

Rathergate showed that when bloggers were able to access primary evidence in the same way as newspaper journalists, they could run with a story. “One of the reasons they were so influential was because they were able to put up what they called ‘the smoking memo’,” says Cornfield, referring to a version of a document reconstructed using Word, and suggesting it had been faked.

“In one sense it’s classic investigative journalism but what’s new is that the clues are out there in the open. It would be as if the Watergate tapes themselves were online and we could all listen to them and hyperlink to them. This is the change.”
(6 June 2005)
We’ve seen the same phenomenon in Peak Oil and energy issues. The web is the place to get the latest and most analytical information; the journalists are scrambling to keep up. -BA