Click on the headline (link) for the full text.
Many more articles are available through the Energy Bulletin homepage
Senior oilman Gareth Roberts on peak oil
Original: CO2 flooding could yield 2mb/d – eventually
David Strahan
For a senior oilman Gareth Roberts holds some fairly unusual views: peak oil is coming soon; crude oil is too precious to burn as transport fuel; and Big Oil should be investing massively in alternative energy.
But then Roberts is the CEO of Denbury Resources, a rare example of an oil company whose strategy is driven by an explicit recognition of peak oil. Founded in 1990, the company has grown into a $5bn independent by buying up mature fields on the Gulf coast of Texas, Louisiana and Mississippi, and applying CO2 flooding to yield as much as 17% more of the original oil in place. But this ‘tertiary production’ technique does not come cheap, and the conviction that peak will mean ever higher oil prices helps the company to justify the additional investment.
At the moment Denbury is by far the largest operator of CO2 flooding, although even it produces just 15,000 barrels of oil per day from the process. But Roberts reckons that in thirty years’ time the technique could yield 2mb/d globally.
Speaking on the sidelines of an oil depletion conference in Cork, Roberts put those numbers in context, and explained why much of Big Oil still refuses to acknowledge peak oil.
Listen the interview with Gareth Roberts.
(20 September 2007)
The portion of the audio interview that was posted talks about the reaction and psychology of the oil industry in relation to peak oil. CO2 flooding isn’t mentioned. -BA
T. Boone Pickens declines to predict oil prices
Steve Gelsi, MarketWatch
Billionaire oil man T. Boone Pickens declined to predict where the price of oil is going on Wednesday as the fuel trades at the record level of $82 a barrel. “I was willing to predict the price up from $20 a barrel, now I’m in uncharted waters,” Pickens said in an interview with MarketWatch. “Now I have to take a little time and figure out how much the consumer can stand.” Pickens said the only force that could drive down the price of oil is lower demand, even as supply remains roughly constant at 85 million barrels a day. “I don’t see any additional supply,” Pickens said. “The Saudis say they have plenty…but I don’t believe that. They’re just about strapped producing what they are now.”
(19 September 2007)
Contributor Daniel Dow
The Trouble with Predictions
Kurt Cobb, Scitizen
The trouble with predictions is that they are mostly wrong. But is there a way that forecasting can be used to help us confront climate change, world peak oil production, and other critical environmental policy issues?
Predicting the path of a comet is far more likely to meet with success than predicting the future course of world food supplies, oil production, climate change or economic growth. For the comet, of course, we need only concern ourselves with the laws of physics. For the other trends we are obliged to consider a complex set of data that might include technological change, political decisions, corporate actions, social customs, economic conditions, commodity prices and so on. The array of factors we must consider is so great that almost all projections that go beyond a few months or a year quickly veer off course.
And yet, humans are planning animals. We are now dependent on complex systems that require us to make forecasts for planning purposes. It is hard to imagine highway planners, for example, designing a new highway without first consulting traffic projections. Still, no matter how hard we try, the future course of such complex systems almost always eludes us. In the 1960s Pan Am sold tickets for future flights to the moon, and its model of a future space plane became the basis for the one depicted in the movie 2001: A Space Odyssey which opened in 1968. Today, however, we seem no closer to regular flights to the moon than we were when the film was released. And, Pan Am itself collapsed in 1991, 10 years before the year in the movie’s title.
Given all this, why do policymakers, corporate chieftains, and the public put so much faith in such prognostications? The answer is twofold. First, they fail to understand the nature of risk. Second, they fail to understand the role of forecasting.
Many people naively believe that important public policy and corporate decisions are made under relative certainty. But, almost all decisions we humans make are made under uncertainty. Let’s review for a moment the types of uncertainty (1). In arithmetic we can say that 2 + 2 = 4 with certainty because it does so by definition. When we place a bet on a roulette table, however, we are making a decision under risk; that is, we know precisely the odds of our chosen number coming up (so long as no one is cheating). But when we forecast something as complex as world oil supplies in 2030 or our future climate, we are venturing into areas where decisions are made under uncertainty.
Obviously, forecasting cannot tell us precisely what will happen in the future. For every forecast the uncertainty grows rapidly with time, and therefore, forecasts years or decades out ought to include very wide ranges. Here is where most people make their big mistake. For forecasts with wide ranges, the range becomes far more important than the actual forecast. And, the most important of the two extremes of the range is the one that will result in the most inconvenient consequences (2).
Let me illustrate this idea using forecasts for world oil production. The U. S. Energy Information Administration’s (EIA) reference forecast for the peak in world oil production is 2037 (3); that is, oil production will rise until that year and thereafter begin an irreversible decline. In all, the EIA has 12 scenarios, the most pessimistic of which calls for a peak in 2021 and the most optimistic of which predicts a peak as late as 2112. (The most optimistic scenario assumes huge undiscovered reserves and absolutely no economic growth.) By contrast, several private forecasters have placed the peak between now and 2015 (4).
If we accept the EIA’s reference forecast, we might believe that we have plenty of time to adjust to a post-oil world and leave all adjustments to the marketplace. But if the more pessimistic private forecasts or even the agency’s pessimistic forecast turns out to be right, we might face very serious consequences that include persistent economic contraction, the breakdown of transportation systems, steeply rising food prices and mass unemployment. Given these wildly asymmetrical scenarios, we might be inclined to take out some insurance now in the form of strict conservation measures and a crash program to find alternative fuels. …
(19 September 2007)
Kurt Cobb writes on his personal website Resouce Insights:
I was recently asked to do a monthly column for the Paris-based science news site, Scitizen, for the Future Energies section. Scitizen is a general science site written by scientists and science writers and aimed at the lay public. My first column, “The Trouble with Predictions,” has now been posted. Readers of this blog will notice that I touch on themes already discussed here. And, they will notice that the tone is a bit more formal and the writing more compressed since I am limited on length. But Scitizen provides me with an opportunity to introduce my way of thinking about energy and sustainability to a different audience. Take a look and see what you think.
NPC presents “Hard Truth” Study to Calif Energy Commission
Jackalyne Pfannenstiel, California Energy Commission’
Notice of Presentation by the National Petroleum Council Representatives to the California Energy Commission
Representatives from the National Petroleum Council will present their comprehensive global energy study: Facing the Hard Truths About Energy: A Comprehensive View to 2030 of Global Oil and Natural Gas.
MONDAY, OCTOBER 29, 2007 2 p.m.
CALIFORNIA ENERGY COMMISSION
1516 Ninth Street
First Floor, Hearing Room B
Sacramento, California
(Wheelchair Accessible)
Purpose
Representatives of the National Petroleum Council will brief the California Energy Commission (Energy Commission) on their comprehensive report addressing the future of global oil and natural gas markets. The Energy Commission will consider the report’s findings and recommendations in future policy deliberations and the report will be a resource for future staff work assessing California and neighboring state transportation energy and natural gas demand, state petroleum and natural gas infrastructure requirements, and trends in crude oil and natural gas production and prices.
Background
The National Petroleum Council is a federal advisory committee to the U.S. Secretary of Energy. They delivered the 422-page report: Facing the Hard Truths About Energy: A Comprehensive View to 2030 of Global Oil and Natural Gas to Secretary of Energy Samuel W. Bodman on July 18, 2007. The report was developed with input from 350 experts from diverse backgrounds and organizations. The report recommends that an integrated national strategy is required for the accumulating risks to the supply of reliable, affordable energy. The report can be found at: www.npc.org. Remarks of the Secretary of Energy can be accessed at www.energy.gov/news/5249.htm.
Public Participation
The Energy Commission’s Public Adviser’s Office provides the public assistance in participating in Energy Commission activities. If you want information on how to participate in this forum, please contact the Public Adviser’s Office at (916) 654-4489 or toll free at (800) 822-6228, by FAX at (916) 654-4493, or by e-mail at [email protected]
Kevin Kidd
California Energy Commission
Web Team
(19 September 2007)
Contributor writes:
Just a head’s up for people in the area — looks like this report has been out in some form since July.
BA:
Search the Energy Bulletin archives for the many articles analyzing the NPC report.
