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Udall, Lovins and Shell v-p on peak oil
Original: Experts: Oil is a slippery situation
John Colson, Post Independent (Colorado)
Experts might disagree about exactly when the world will run out of the oil that is easily found and extracted, but most agree that it will happen at some point and that humanity should be preparing for that day.
That was one of the messages to come out of the second full day of The Aspen Institute and National Geographic Magazine Aspen Environment Forum, at a panel discussion featuring energy-efficiency guru Amory Lovins, green technology specialist Randy Udall, and Marvin Odum, executive vice-president of Shell Oil.
… Udall, former head of the Community Office for Resource Efficiency in Aspen and Carbondale, noted that the world is cranking out about 80 million tons of carbon dioxide every 24 hours, a statistic that has focused the world’s attention on global warming from greenhouse gases such as carbon dioxide.
“We’re focused on the smoke,” Udall said of the issue. “Let’s think about the fire.”
… “Energy is an IQ test that most Americans fail,” Udall continued. “We are so clueless, we are so spoiled …”
Even Shell’s Marvin Odum agreed that oil supplies will have peaked out within the next seven years or so, but he said the oil picture may be helped by development of what he termed “unconventional hydrocarbons,” meaning tar sands in Canada, oil shale in Western Colorado, coal, and “biomass,” the use of living or recently dead plant life for fuel or other industrial purposes.
“There’s not any silver bullets,” he said, maintaining that societies around the world must rely on a mix of technologies to make up for the oil that soon will disappear.
… Lovins, co-founder of the Rocky Mountain Institute in Old Snowmass and renowned energy efficiency expert, said that the world’s best bet for reducing oil consumption is to concentrate on efficiency – doing the same amount of work with less energy.
… Lovins argued that China, at the same time, is working to increase energy efficiency in its various economic sectors, because “Beijing is scared to death of falling into the same trap we did.” Both Lovins and Odum predicted that China may be a leader in a future shift to more efficient use of dwindling energy reserves, and in the search for alternatives to oil.
(29 March 2008)
Russian Oil Output to Fall for First Time in a Decade
Greg Walters, Bloomberg
Russian oil output may fall this year for the first time in a decade as the world’s second-biggest supplier struggles with rising costs and harder-to-reach fields, Natural Resources Minister Yuri Trutnev said.
“Two years ago, we said the growth rate was falling, and we said this was bad for Russia, remember?” Trutnev said in televised remarks after a government meeting in Moscow today. “Now we’re saying the production rate is falling this year. This is not a bogeyman, unfortunately, this is real,” Trutnev said, without giving a specific forecast.
A decline would end a 10-year, 58 percent surge in production, which fell to 6.2 million barrels a day in 1998, when prices dipped below $10 a barrel and Russia defaulted on about $40 billion of domestic debt and devalued the ruble.
(27 March 2008)
Contributor Jeffrey J. Brown writes:
Following is an excerpt from my original (January, 2006) post on declining Net Oil Export capacity (building on prior work by Simmons & Deffeyes, among others). I probably did overestimate the Russian production decline, because of new production from frontier basins, and I am certainly no expert on Russian production, but my impression is that frontier Russian basins are to Russia as Alaska is to the US, i.e., it will help but it is no panacea.
The Hubbert Linearization (HL) method–using only data through 1985–predicted that Russia would produce 61 Gb in the 19 years after 1985. In reality, Russia produced 57 Gb. Actual production was 93% of predicted. As I noted above, I think that it is significant that actual production is 4 Gb below the HL prediction, given that everyone is so mesmerized by the recent increase in production.
Can anyone think of any other method that would have been this accurate? Remember, the data cutoff, used to generate the plot, was 1985. Currently, it appears that production is about 5 mbpd above where it should be based on the HL plot, but 5 mbpd is 1.8 Gb per year, so we could actually see a year or two of rising production before production reverts to the curve (assuming that it will). For what’s worth, my bet is that Russia will start a steep decline no later than next year. If Russia is going to revert to the curve, if it started right now it would probably require a decline rate of about 11% per year.
Dissecting the Long Emergency
Sharon Astyk, Casaubon’s Book
If there is one thing Jim Kunstler deserves all the props in the world for, it is his naming and describing the complex, sweeping and all-encompassing crisis we’re facing. He called the combination of energy, climate and financial crisis “The Long Emergency” and I think that’s turning out to be just about right. As a prophet, Kunstler is looking pretty accurate in some respects (I’m still kind of skeptical about the Asian pirates marauding across the northwest coast, but maybe I’m wrong ;-).
I’ve been getting emails from people asking me whether the present crisis is “just” financial and whether/how peak oil and climate change are factors. And this is a fascinating question – because, honestly, it is awfully hard to sort them out. In fact, it is really all one crisis – I call it (perhaps not as eloquently as Kunstler) the crisis Ourobouros, the great worm that encircles the globe, and does not realize that he is devouring his own tail – it is impossible to entirely find the beginning or end. But we can take a stab at it.
I thought for my own edification, and perhaps for others, it might be worth trying to sort out how all three segments of our present situation are working together, and what parts of the hard times facing us are tied into more than one segment of the crisis. I make no claims that I can provide a perfect explanation, or that I won’t miss some links, but if nothing else, it is an interesting way for me to clarify my own thought. So I’m going to list present problems one by one, and describe how (if at all) they are tied into each element – financial crisis, climate change, peak oil. I’ll try and figure out whether what we’re seeing is a cause or effect, and just how closely related they are.
(28 March 2008)
Peak Oil Passnotes: Peak Oil Is Here, Enjoy
Edward Tapamor, Resource Investor
It has been interesting to note how the subject of ‘peak oil’ has gained ground over the past five years. In 2003 when the subject first gained some kind of exposure – on the BBC’s Money Programme in the U.K., on Aljazeera’s English-language internet service and occasional other articles the response from the industry was a furious one. Peak oil did not exist and never would do.
How times have changed. Christophe de Margerie, the chief executive of Total [PA:FP; NYSE:TOT] in France, says the world will never produce 100 million barrels per day of oil; we currently produce around 85 million barrels per day of oil. He thinks we are in an era when high costs, geo-politics and the decline rate of existing fields will simply stop any attempt at getting to 100 million barrels per day of oil. It will stop the world hitting the kinds of levels of production we are told the global population will imminently need.
… In the U.K. the government and the oil industry has given up trying to argue that the north sea will somehow rebound and get back to the levels of even five years ago. It is now widely understood by the general public that the U.K. is going to be a net importer of energy from now on.
… One of the reasons the message has found such stony ground on occasions has been the antics of peak oil ‘believers’. We use the word ‘believer’ in brackets because, although peak oil is a reality, the ‘believers’ take it to a whole new faith-based level. Anyone with a whacko axe to grind, be they the 9-11 crowd, the fascist BNP in the U.K., the back to the cave greenies and others have latched onto peak oil as a crutch for their existing views.
The reality of peak oil is in fact closer to that of Christophe de Margerie, with some caveats. Firstly if you produce a lot of oil you have a bigger decline rate. If you have a bigger decline rate you need to find and bring on stream a lot more oil, every year, every month, every week. If the demand for that oil is exacerbated by – for example China – the cost of it rises and so does the cost of extraction.
(28 March 2008)
Colin Campbell and the Crack of Doom
Peter McKenzie-Brown, Language Matters
For many peak oil believers, this is the scariest chart you can imagine. The blue lines show historical oil discoveries. The gold lines project discoveries into the future. The line that looks like a rising serpent shows annual production up to about 2005. The chart was created by peak oil guru Colin Campbell in 2004 in a deliciously ironic article titled “The Heart of the Matter”. The chart suggests the crack of doom, and it has been quite influential since Campbell developed it.
In this column I have frequently provided arguments in favour of peak oil theory, and I am an unabashed admirer of Campbell and his work. However, I believe this chart, though directionally accurate, is simplistic and alarmist. It needs to be nuanced. We can do that in three ways.
(28 March 2008)
