MATTHEW SIMMONS is not exactly an imposing figure. An unassuming man, his gentle voice bears the soft twang of Texan gentility. Blue eyes twinkle behind rusty cheeks as he reminisces: “I loved those peaches.”
Matt is an investment banker and energy advisor to some of the largest organizations in the world, including Chase Bank, Halliburton and the World Bank. He is a member of the Trilateral Commission and a personal friend of Dick Cheney’s. And very few people in the world know Peak Oil like Matthew Simmons.
Mr. Simmons was highly dissatisfied with the information available from the Saudis about their oil capacity; they do not allow independent auditing of their “proven reserves.” Undaunted, he painstakingly analyzed over 200 technical papers published by the Society of Petroleum Engineers and concluded that Saudi Arabia’s reserves weren’t proven at all. Today, Simmons believes that Saudi oil production will soon peak.
The “Peak” in “Peak Oil” refers to the point when oil production climaxes, after which it follows an irreversible decline. Twenty-three out of forty-four oil producing nations have already peaked, including the United States, Norway and Iran.
No new fields of any significant size are being found to replace those in decline. The last remaining “elephants”—giant, 500 million barrel-plus fields—are in Saudi Arabia. According to Simmons, “When Saudi Arabia peaks, so does the world.”
Fossil Fuel Depletion: Consequences and “Solutions”
What will Peak Oil mean for our oil addicted world? Prognostications range from a rosy, seamless conversion to alternate energies to a massive die-off akin to the Black Death, although the truth may lie somewhere in between. Our economy and food supply are so oil dependent that its depletion has the capacity to crash the stock market, squelch economic growth and render vast tracts of agricultural land fallow. The cost of trade will skyrocket, isolating economies that fail to localize. Chronic problems like hunger, unemployment and homelessness are sure to become acute.
Indeed, the stakes are very high, and decisions that are made now will determine our ability to survive in a post-carbon world. But who will make these decisions, and will “remedies” to the coming crisis be in the best interest of humanity or of a small elite?
Of all the “Peak Oilers,” Simmons is the most influential in high places. He has long played an advisory role for the Bush administration, serving on Dick Cheney’s secretive Energy Task Force.
Among the few documents released from those meetings was a map of Iraq’s known oil resources.
Simmons’ knowledge of world energy supplies coupled with his intimacy with Cheney has led some to suspect that, along with conservation and organic farming, one of his favored “mitigation strategies” may well be the occupation of Iraq.
The latest war in the Gulf may not just be a war for oil, but a war for the last oil on earth. Because war and embargo stifled Iraq’s oil production, Iraq will peak last and will be producing oil long after other nations’ wells have run dry.
Organic Peaches, “Clean Coal” and Splitting Atoms
This grim speculation was in the back of my mind as I conversed briefly with Matthew at the Global Oil Depletion conference in Spokane on October 5, 2005. He was expanding upon a comment he made during his keynote presentation about the importance- and palatability- of organic agriculture. He waxed sentimental about his mother’s canned peaches and how commercial peaches just don’t taste the same. The contrast was palpable; Simmons is down-home, like a country uncle, yet directly connected to neo-conservative war-makers and energy industry big-wigs.
While Simmons’ keynote underscored a broad need for mitigation, he left it to others to be more specific. Fellow keynote speaker Dr. Roger Bezdek, of Management Information Services, Inc. (MISI), recommended increased vehicle efficiency, but mainly focused on supply side solutions. Coal liquids and Canadian oil sands were on his menu. Bezdek answered the obvious pollution question with this quote: “It is not clear how environmental protection will fare if there is widespread joblessness, high inflation & severe recession.” Not exactly Sierra Club material.
The next presenter, Jim Ekmann, is an associate director from the Department of Energy’s National Energy Technology Laboratory. His presence shatters the notion that the Bush administration is not hip to oil depletion. His presentation included a quote from President Bush stating that “clean coal technology is critical to the future of this country.” So much for the West Virginia mountaintops.
Robert Dunbar of the Canadian Energy Research Institute pitched the Albertan tar sands as a remedy. Oil sands operations are among the most polluting in the energy industry, requiring about 3 barrels of water to extract one barrel of oil. Syncrude’s tailings pond near the pristine Athabasca River is already over 22 square kilometers, and they intend to increase production by a factor of 10.
Alan Waltar of the Pacific Northwest National Laboratory made the case for nuclear energy, but used some questionable statistics to do so. He used a graph portraying nuclear as the lowest cost electricity source per kilowatt. This deceptive chart did not incorporate the massive capital, disposal, decommissioning and, of course, human costs involved in nuclear power production. He did not exactly receive a hero’s welcome.
Peak Oil Profiteers
As Peak Oil begins to surface in common discourse, we will encounter more “experts” who will offer dubious solutions that may profit them in the short run yet make us all poorer. No matter what action is taken, we will be living in a world with less available energy and weak economic systems. Could we deal with even more nuclear waste, water pollution and carbon emissions than we have now in a crippled post-carbon society?
Urban agriculture, solar and wind power, local currencies and economies, and energy efficient homes are only a few of the many sustainable options we have to deal with this coming crisis. We may choose to change our ways and learn to live sustainably, or we can pave the road to ruin with mine tailings and spent nuclear rods. The choice is ours.
Lisa Mann is a musician, energy activist and former Commissioner at the Tualatin Valley Water District. You may reach her at [email protected]