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ODAC Newsletter - Aug 3

Welcome to the ODAC Newsletter, a weekly roundup from the Oil Depletion Analysis Centre at nef dedicated to raising awareness of peak oil.

US oil and gas reserves grew faster than at any time in the past 35 years according to figures released this week by the EIA. The numbers are for 2010 with the increase credited to fracking technology and high oil prices, leading to more exploration and development. While the report will be used to provide further confirmation of a new era of energy abundance, there is growing evidence that the realities when it comes to actual production are not as rosy. Reserve numbers refer to economically viable resources, yet last week saw a list of major energy companies hurting as they were forced into write downs on their US shale gas assets.

Worse could be yet to come as meaningful historical drilling data begins to emerge from more mature regions. According to Bob Brackett, an analyst with Bernstein Research, production from shale oil in the Bakken region of Montana has seen a 40% drop in production since 2006, this despite increased investment and technological improvements. He puts the decrease down to the fact that not all shale oil plays are equal — inevitably the best areas are drilled first — and anticipates the same curve will occur in the much vaunted Bakken play in North Dakota. There have of course been warnings, not least by Art Berman, and Ian Urbina at the NYT, but the popular narrative remains one of abundance.

In the UK, the Energy and Climate Change Committee this week issued a call for evidence on the impact of shale gas on energy markets. The report is to investigate the potential for recoverable gas resources in the UK and globally, look at its potential effects on energy markets, and how it might affect climate change targets. The report is likely to play an important role in the government's current energy policy wrangles discussed in last week's newsletter, so it crucial that the committee absorbs the sober analysis referred to above.

The message that the committee will no doubt hear from the energy industry is summed up by Lord Browne, ex BP CEO and chairman of shale gas explorer Cuadrilla, who recently told a conference — the US would be "completely independent of imported oil, probably by 2030" as a result of shale oil, and that its shale gas is "effectively infinite". It's just the the kind of fairy dust that many in desperate times will want to believe in.

ODAC will be taking a break for the next 4 weeks. We will be back with more news and comment on September 7th. Thanks for your support.

Oil

EIA sees growth in U.S. oil, natural gas

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A mountain-top take on the "flood of oil supply"

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Analyst: Calif. shale oil field results disappoint

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Gas Liquids 'Bloodbath' Brings Shale Pain To Oil Market

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Russia's July oil output up to 10.34 mln bpd

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Iraq Kurdistan oil export restart may be temporary

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Oil Glut Forecaster Maugeri Admits Duff Maths

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Oil Rises From Three-Week Low on Speculation of More U.S. Jobs

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U.S. orders major Enbridge oil pipeline review after leak

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BP profits plunge 96pc to $238m in second quarter

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Iran Oil Shipping To Resume As Insurers Step In: Corporate India

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Gas

Shale Writedowns Begin As Lower Prices Follow Record M&A

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Electricity

India blackouts leave 700 million without power

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Blackouts highlight diesel needs, price problems

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Climate change threatens California power supply: report

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Renewables

EDF profits rise 4.6pc as renewable energy replaces nuclear

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Germany's energy transformation: Energiewende

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UK

MPs drill down to assess shale gas impact

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EDF looks to spread UK nuclear costs

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UK cuts feed-in tariff for solar panels

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Transport

Foes of EU airlines carbon plan say back U.N. scheme

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Abu Dhabi launches region's first rapid electric car charger

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