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Oil Dreams in the Gulf of Mexico

Roger Blanchard, ASPO-USA
Oil production has a long history in the Gulf of Mexico (GOM) with production starting in the shallow waters off Texas and Louisiana in the late 1940s. The heyday of shallow-water (less than 1000 ft) production occurred in the early 1970s when the production rate reached a little over 1 million barrels/day (mb/d).

(Note: Commentaries do not necessarily represent ASPO-USA’s positions; they are personal statements and observations by informed commentators.)

Shallow-water production went through 3 peaks, each progressively lower, due to the expansion of drilling territory and development of more advanced extraction techniques. The last peak occurred in 1997 at approximately 830,000 b/d.

From 1997 through 2003, shallow-water production declined at an average rate of 5.9%/year. In 2004/2005, hurricanes Ivan, Katrina and Rita caused extensive damage to GOM oil production facilities that reduced production, particularly in 2005. By early 2007, production had essentially recovered. Shallow-water GOM production should be approximately 450,000 b/d in 2007.

It’s clear that shallow-water oil production in the central and western GOM is in terminal decline. The decline rate since 1997 indicates that the ultimate recovery from this region will be approximately 15 billion barrels (Gb). The Bush administration has opened areas in the east-central GOM that could conceivably cause a minor bump-up in production, but there isn’t sufficient oil in that region of the GOM, or farther east, to make a significant impact on shallow-water production.
(17 December 2007)

Urgent message from ASPO-USA

Officers and board of ASPO-USA
Dear ASPO-USA Supporter:

… ASPO-USA is working to wake up decision makers, connect the dots, and promote intelligent mitigation steps to help us proceed with foresight rather than react in hindsight. We’re sponsoring international Peak Oil conferences, providing technical support requested by Peak Oil Caucuses within state and national legislatures, publishing the weekly Peak Oil Review and the daily Peak Oil News, making presentations to civic, professional, and governmental organizations across the nation, and much more.

And we’ve accomplished all this on a volunteer basis, with virtually all work done by our board and advisory board, without a staff, an office, or an annual operating budget. All of our funding has come from membership fees, conference registration fees, and individual gifts from supporters like yourselves … without any grants from foundations, industry or government.

The Time for Energy Action is NOW … not “decades away!”

In spite of the progress we’ve made, at this point the stakes are too high and the time is too short- and a volunteer organization is no longer sufficient- to pierce the armor of denial and that is blocking intelligent response to the Peak Oil challenge.

At a bare minimum, ASPO-USA needs a small, full-time staff to fulfill our non-partisan, non-profit mission to conduct research and education programs that raise awareness of our peak oil and natural gas challenges and promote a sane energy future for ourselves, our children, and our grandchildren.

Steve Andrews and Randy Udall, the original driving forces of ASPO-USA, have agreed to serve as unpaid Interim Executive Directors, to work with our Energy Action Teams of select staff, board, and advisory board members to move forward with bold new plans to fulfill the ASPO-USA mission.

Building on Houston – Announcing the Bob Kanner Challenge Grant

The results of our Houston conference survey are inspiring: rave reviews call it the biggest and best Peak Oil conference ever held, with more attendees and more presentations- offering more new information and gaining more media attention- than ever before.

It also inspired the greatest single financial opportunity that ASPO-USA has ever had: an exciting Matching Grant Challenge from one of our loyal supporters, Mr. Bob Kanner of PubCo in Cleveland, Ohio. After funding the DVDs of our Boston conference, and contributing $25,000 as Headline Sponsor of the Houston conference, Bob offered to contribute $1.00 (up to $100K) for every $2 dollars we raise to fund a two-year campaign aimed at major foundations to put ASPO-USA on a firm financial footing.
(17 December 2007)
It’s amazing what ASPO and the rest of us have accomplished on almost no money.

Volunteers can get things started, but after a while burn-out approaches. To be effective, the peak oil movement needs to move from an all-volunteer effort to some paid staff. We’ve been thinking about this too at Energy Bulletin. -BA

Peak Everything: What, Me Worry?

Dana Visalli, Methow Naturalist
Humans appear to be programmed by their genes to see the world as it isn’t. What support is there for this claim? One piece of evidence is the tendency for people to believe that growth can go on forever on a finite planet.

… The peak of any critical resource is more important than the point of complete exhaustion, because after peaking supply can no longer meet demand, and economic growth ceases.

Here’s where the mind starts playing little tricks. “Abundance,” it thinks. “That which was abundant yesterday will be abundant tomorrow.”

But, as you shall see, we have some big issues with future energy supply. …

Dana Visalli works as a biologist and a naturalist.
(December 2007)
The Methow Naturalist is “a journal and website of natural history in the Methow Valley and on the east slope of the North Cascades”

Contributor Dana writes:
The article is out in our local journal ‘Sustinere,’ I see that it is locally effective in communicating to the general public.

Peak Oil – Oil Prices in an Era of Plateau

Aaron Wissner, Blog
Peak oil, and in particular, the current plateau in oil production, has had a dramatic impact on the price of crude oil. Over the past ten years, the price has increased from a low of $10 per barrel, to a high of over $90 dollars per barrel. This is an increase of over 10% per year, although most of the increase has occurred during the past four years.


The week by week analysis of the spot oil prices is useful to see the trend, but even more interesting, is taking the data, and creating a six month rolling average. This averaging helps to smooth out the curve and show the trend in the price changes. It also gives a feeling of how the price has changed during various time periods. ….
(15 December 2007)
Aaron has put up several new articles recently on his blog:

Peak Oil – Accurately Predicting Oil Prices & The Value of Oil
World Oil Production Extraction Supply Plateau Charts – December 2007
Peak Oil and the Vision in the Mirror (general introduction)

ODAC Newsletter to cease in 2008

Oil Depletion Analysis Centre
Biweekly updates on Peak Oil / Gas and related subjects such as geopolitics, food production and alternative energy are available from the NEWSLETTER menu option to the left [at the ODAC site]. These will cease being produced end of December, 2007.
(17 December 2007)
Sad news from ODAC. The biweekly newsletter that Douglas Low has been producing will stop publication. Many thanks to Douglas Low for all his work keeping us up to date. -BA

ODAC News – Monday 17 Dec

Douglas Low, Oil Depletion Analysis Centre
1/ The Myth Of Biofuels (ODAC, Mon 17 Dec)

Natural Gas – Turkey
2/ Turkish gas use up 20% on 2006 to 27.72 Bcm (Platts, Thu 13 Dec)

Economy – UK
3a/ House price confidence at lowest since 1998 (The Telegraph, Thu 13 Dec)
3b/ House prices pumped by interest rate cuts (The Telegraph, Wed 12 Dec)
3c/ Sub-prime ruts and interest rate cuts (The Sunday Telegraph, Sun 16 Dec)
3d/ London house price fall of 6.8% in past month stokes economy fears (The Times, Mon 17 Dec)

New Projects – Saudi Arabia
4/ Saudi Arabia’s Greater Khursaniyah Area (GKA) project delayed by 6 months (Energy intelligence, Thu 13 Dec)

Natural Gas And Electricity Prices – UK
5a/ Consumer bills set to soar as gas prices climb (Times Online, Fri 14 Dec)
5b/ Business users warned of fuel cost problems (Financial Times, Mon 17 Dec)

Peak Oil Articles In The Mainstream Media – UK
6a/ Plenty of oil left in the global tank (The Sunday Times, Sun 16 Dec)
6b/ Are commodities a bubble ready to burst? (The Sunday Telegraph, Sun 16 Dec)

Food Inflation
7a/ US Food Inflation Parallels 70s on Ethanol Boom (Planet Ark [Reuters], Mon 17 Dec)
7b/ World food price rises to hit consumers (Financial Times, Sun 16 Dec)

UK Oil and Gas Production Presentation
8/ UK Oil and Gas Production Forecasts: An Overview (ODAC, Mon 10 Dec)

Oilwatch Monthly – December 2007
9/ Oilwatch Monthly – December 2007 (The Oil Drum: Europe [Rembrandt Koppelaa], Sat 15 Dec)
(17 December 2007)

ODAC News – Thu 13 Dec

Douglas Low, Oil Depletion Analysis Centre
IEA Oil Forecast
1/ IEA exec says oil supply crunch looms (Business Week, Tue 11 Dec)

Electricity Supplies – UK
2/ How coal is the future (The Sunday Times, Sun 14 Oct)

The New Energy Paradigm
3a/ Oil Price Rise Causes Global Shift in Wealth (Washington Post, Sat 10 Nov)
3b/ Without reform, Mexico’s crude exports will collapse: ministry (Platts, Tue 11 Dec)
3c/ Saudi Industrial Drive Strains Oil-Export Role (Zawya [Wall Street Journal], Wed 12 Dec)

What is Progress?
4/ What is Progress? (, Tue 04 Dec)

5/ Is biofuel industry boom going bust? (Arkansas Online, Sun 02 Dec)

Economy – UK
6a/ The Business Show (The Telegraph, Tue 11 Dec)
6b/ British businesses set for more ‘busts’ in 2008 (The Telegraph, Tue 11 Dec)
6c/ Food prices rising at highest rate for 14 years (The Telegraph, Tue 11 Dec)
6d/ 1.5m ‘will struggle to find affordable mortgage’ (The Telegraph, Thu 06 Dec)
6e/ Housing market on the brink (The Telegraph, Mon 03 Dec)

China – Energy Growth and Inflation
7a/ China maintains thirst for power (Financial Times, Mon 10 Dec)
7b/ Cities told to keep food, oil reserves (China Daily, Wed 12 Nov)

Petrol Supplies / Car Growth – Italy, UK
8a/ Hauliers split over fuel depot protests plan (Financial Times, Tue 11 Dec)
8b/ More cars need extra roads, say experts (Financial Times, Wed 28 Nov)
8c/ Italian truck strike stops fuel, food supplies (Reuters, Tue 11 Dec)
8d/ Post Peak Italy (The Oil Drum: Europe [Ugo Bardi], Wed 12 Dec)

Economy – USA
9a/ Iranian oil no longer available for U.S. dollars (RIA Novosti, Tue 11 Dec)
9b/ Morgan Stanley issues full US recession alert (The Telegraph, Tue 11 Dec)

Vehicle Efficiency (Lack Of) – USA
10/ Caught Between a Growth Myth and a Price Doctrine (Washington Post, Sun 09 Dec)

Natural Gas – Europe
11/ The European Gas market (The Oil Drum: Europe [Euan Mearns], Tue Dec 11)
(13 December 2007)

Earth and Energy Round-Up: December 12th/15th 2007

Stoneleig, The Oil Drum: Canada
(15 December 2007)
Headlines and excerpts from a peak oil perspective.