371 comments on Does the Peak Oil "Myth" Just Fall Down? -- Our Response to CERA
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371 comments on Does the Peak Oil "Myth" Just Fall Down? -- Our Response to CERA
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Also, we hope that you will also spend some time talking about this subject on your own blogs, sending this post to as many media outlets you think will publish or respond as possible, and sending this post to your public and/or elected officials.
Simply put, we must come to achieving a better understanding of our energy supply--the geopolitical, political, and social aspects of a plateauing supply with ever growing global demand could have an impact on the daily lives, especially of those who are less fortunate.
TOD will also be putting out a press release on this topic next week; we hope that you will also send that around as well when it is ready. It will be shorter and more consumable for those not exposed to this mode of thinking.
Just a quick idea, but getting press attention for the issue tends to require the 'good story'. CERA achieve this by pushing a view which is contrary to the accepted wisdom and very palatable for the general populous to believe in.
A suggestion would be to challenge CERA to a wager - say the $1000 they charge everyone to get hold of the words of 'wisdom'. CERA take their optimistic predictions of world oil production, TOD one that reflects the peak oil hypothosis and predicted data set. Whoever gets closest to the mark over a defined time period (say the whole of 2007) wins the bet.
The story is good and would get coverage, and I'll bet that given the reported mismatch that is already in their predictions, CERA would decline to take part - telling its own story.
If we are so flush with energy, then why is it that today I received the third mailing from my local utility company offering a $25 energy credit in return for allowing them to install a device that periodically shuts off the air conditioner during times of peak usage? I also received a telephone call from a pushy company rep with the same offer.
The utility company must have sent that letter to all their customers.
You don't need to keep your house at 65F durring the summer while your not even home. Turn it off or turn it up and save some energy.
The topic of the main posting is that CERA and other like minded groups are implying that ff production capacity is not reaching its limits and can meet projected demand. If that is the case, then it does not follow that utility companies would be worried about not being able to meet demand. The large metropolitan area I live in already had an incident last winter when the utility company was forced to shut off power to large areas due to lack of natural gas. Personally, I see this as a harbinger - but that is my take.
I understand that utility company problems are multifactorial, but this was beyond the scope of the simple point I was making. You were not even on the same page. Heck, you were not looking at the same book.
Try not to be so overreactive. Your views may be in the minority on TOD, but having a thoughtful and polite tone will go far in allowing others to consider any valid points you may make.
I would like to point out your original post is irrelevant. There are many reasons for electric companies wanting to reduce demand during peak periods, many of them financial.
And your story about your utility having to shut off power because of a natural gas shortage? This post was about liquids.
PS. I agree that Hothgor was rude.
ImSceptical was right. This kind of program has very good justifications that are unrelated to fuel shortages.
It's called "demand management". It can be much cheaper to pay people to allow the utility to turn off their demand at peak, versus building new generation capacity just for peak demand.
in any case, i applaud energy conservation efforts for whatever reason.
The WSJ had a short note yesterday about the American Petroleum Institute (API) sending a letter to Congress warning them that if they raise taxes on the oil and gas industry it will hinder the industry's efforts to bring on new supplies of oil and gas and new alternative energy sources.
I actually agree with the API on this point, but I disgree withe the semi-cornucopian way they (and probably CERA) are trying to combat higher taxes. IMO, we need a much higher tax on energy consumption, offset by a cut to the Payroll Tax.
If you have time, could you please explain a little more about what you say here? I'm just not sure I'm reading this correctly. 1) Are you saying that the industry efforts to bring on "new alternative energy sources" would be hindered by raising taxes on the industry itself? 2) And when you say you agree with API...do you see a difference between "...taxes..on the industry" and "...a higher tax on energy consumption"? Or, do you see these as being essentially the same? 3) What do you see as actions that would promote (rather than hinder) "...new alternative...sources"? (I just realize I'm assuming by "new...sources", you mean - actually, which new sources are you including when you use this word?) I apologize in advance if I've not understood your previous posts on this subject. Thanks.
Full disclosure: I am an energy producer. In any case, I don't think that taxing energy production is going to help. I think that we need to tax energy consumption--in much the same way the Europeans do. Total energy consmption per capita in the US is twice what it is in Europe.
However, the API is taking the cornucopian approach. Just leave us alone and everyone will continue to be able to drive their SUV to their suburban mortgages.
BTW, the weekend WSJ has an article that goes into considerable detail on the effect that forced energy conservation is having on Africa.
WT,
As long as we continue to offer oil companies corporate welfare, they will take it. With Exxon receiving the largest profit in corporate history (any corp), I doubt that increasing taxes and eliminating subsidies will hurt it much.
As they get prodigiously richer, the oil execs will be the only people who can afford to drive SUVs to their mortgages.
I agree that consumer taxes are necessary, but we must not forget the super-wealthy corporations. I am, of course, assuming that when the MSM says "profit," they mean money left over after all operating expenses, including research and exploration dollars.
Personally, I believe that we must immediately begin taxing the bejeezus out of all the rich and especially the corporations. They have gotten too much from the commonwealth and returned too little or have caused actual damage.
I have little sympathy for rich people who cry crocodile tears when they only have a couple of million dollars left to live on. BOO HOO.
This sort of selfish behaviour earns the applause of right wingers who claim it is precisely this "evil" behaviour that produces all the good things we currently enjoy. Unfortunately, for this argument, the good things have been available since time began. I.E. food, water, and air. (For how much longer, I don't know.) Corporations do not account for environmental costs, effectively off-loading these costs onto the commons. When a person gets sick from pollution caused by a corporation hundreds of miles away, society picks up the tab. This is nitpicking on my part, using the terminology of the economic categorizer, please forgive me. I must wash out my mouth with organic soap. The overarching truth of pollution remains: it is killing the planet. Does not matter how we slice the fictional economic pie, that group over there, better known as XYZ Corp., engages in murder; therefore, such selfish, evil behaviour must be stopped. That is why we must tax the bejeezus out of the rich. We need to clean up their selfish messes.
A tax on a corporation is a tax on its employees, its shareholders and its customers.
A corporation is just a legal construct, it isn't an end user in economic terms.
The actual fraction of say a $100 tax might be split 33/33/34 or it might be split very differently.
It depends on how competitive the markets in which the corporation operates in, and how competitive the suppliers are, and the employees.
So a company like WalMart is incredibly competitive, dominates its sector, dominates its supplier *but* it makes sub 10% margins.
Any new tax on WalMart is passed through to its employees, its suppliers and its customers.
Any proposal to 'tax' corporations has to recognise this transparency.
In practice, what the US should have is a low rate of corporate income tax (I would argue 25% or lower) but *no* exemptions. This would have the least distorting effect on tax revenues, and might actually raise corporate tax revenues.
Good thoughts, tho' I'm not an economist enough to agree or disagree..
As long as the 'no exemptions' part doesn't just get painted as a 'new tax', I think this would have a prodigious effect.. almost a corporate Flat Tax. So in the same corner, do you have a take on a US policy direction that would also deal with the virtual 'offshoring' of corporations to avoid our taxes? Would it be better to have a policy DISincentive to being outside the border (ie, Tariffs and other int'l Trading costs?), or some other kind of INcentive to keep a firm flying the Stars and Stripes? Membership ought to have its priviledges..
Bob Fiske
Dave-I understand the new Congressional commitee on energy is skeptical of the CERA report, stating they felt Cera's use of USGS data was erroneous. Should get them a copy of your work. Sorry I don't recall/have the links, just I recall an AP wire story read yesterday.
These CERA-related stories were probably earmarked elsewhere here at TOD:
http://www.tetrahedron.org/articles/new_world_order/bush_nazis.html
This could be worth some digging.
Oh boy...
http://www.nndb.com/people/460/000060280/
Now, where did I leave my tin foil hat?
I need a tin foil coat to go with my hat
The fact is who pays CERA's bills is quite relevant perhaps more so than the organization's claim for objectivity. These analysts are ultimately hired by corporations (often through industry trade groups)for one reason: to promote either the company(s) that hired them or the individual that signed the contract. CERA's job is to make petroleum-related industries and people look good. I didn't pay their way. Perhaps you have?
There is one maxim that will drive any successful political or business investigation: follow the money. I say do it.
And when did CERA become the "contrary" source to the conventional wisdom? I feel they merely reinforce the status quo more than anything else.
CERA states: "The new report describes CERA's liquids supply outlook as "not a view of endless abundance."...Global production will eventually follow an "undulating plateau" for one or more decades before declining slowly...During the plateau period in later decades, according to the CERA analysis, demand growth will likely no longer be largely met by growth in available, commercially exploitable natural oil supplies.
As far as I can tell the Norwegians are at the forfront of recoverability technology, and they admit that only injecting water or gas is the best technology so far. When you inject water or gas, the well lasts longer but output declines -- it is a bump on the bottom of the decline curve.
The Norweigans describe their technologies to improve recovery: 1. injections of water or gas, 2. use of foam combined with WAG (FAWAG) and of microbes (MIOR) (which hasn't worked well so far for Norway) -- the NPD does not know of other other methods that work but suggests research should be done to improve recovery. Does anyone know of any advances in recoverability technology?
If one thinks about the processes involved, a long lasting trickle seems reasonable.
Alan
"The underlying analytical model formulated by the late M. King Hubbert both fails to recognize that recoverable reserve estimates evolve with time and are subject to significant change, and it also underplays the substantial impact of technological advances...
"The peak argument is an incomplete and therefore misleading analysis because it ignores the role of development (vs exploration) projects in expanding reserves, fails to understand economic factors that can point company and national strategies to emphasize development vs exploration work."
I study IOR (improved oil recovery) and EOR (enhanced oil recovery) when I work on this stuff and post on it frequently.
It's insulting for CERA to say that. If you click on the link I provide in the last paragraph of my post, you will see an article by some of our ASPO-USA colleagues -- one of whom is Jeremy Gilbert, former Chief Petroleum Engineer for a small oil company that nobody here has ever heard of called British Petroleum. I'm quite sure he knows nothing about IOR & EOR.
Help me out here. My level of sarcasm doesn't seem quite up to the task.
Keeping our cool we can see that they provide ammunition for counter-arguments, such as you provide by talking about Mr. Gilbert and the other oil people who contribute. You are doing a great job. We can ask them to explain how all these factors haven't reversed the path of decline in any region yet, but they continue to cling to the belief they somehow will? Their reliance on fantasy technologies, fantasy oil fields, fantasy reserve growth and fantasy energy positive unconventional sources to arrive at their fantasy numbers is what's really amateurish and despicable.
To do otherwise, leaves stranded URR and that my friend is an oxymoron. We are not talking of micro advancements of IOR.
The "distortion cloud" clings closely to one cleverly concealed place: CERA's database.
Obviously it is a matter of national security to make sure that no one knows the truth and to embed notions of mistrust and confusion in the ranks of those few scientists who have figured it out anyway.
Rumor has it that CERA's secret database is located in a remote and fog-shrouded island somewhere between the North Pole and NeverNever Land.
Who cares if history proves them wrong 15 years in the future? Such reports / statements have a very short half-life. Only Mr. Yergins' reputation might suffer a bit, but he's a public person. And the most important thing about someone in public is that he gets press - good or bad only matters if you're up for election...
Used the German, which means "if" and "when".
Happens sometimes..
I really don't want to go. The Sheik's third son has really got it set up pisser for me. And I really think his third wife's sister's [screeech]'s bodyguard's [yo don't say that] with the big o' [yo!] is working out real good. I'm serious. She smells good, too.
When I went to digg (or was it reddit?) this article, a different menu popped up, and it wanted me to tell it about the article, including a category. So is it
- business/finance?
- environment?
- world news?
... it doesn't quite seem to fit any one digg category.It's been three months or so since I did a Peak Oil column in for my suburban Dallas newspaper group. I'll do something sometime before the end of the year.
If a story gets enough diggs it will make it to the front page.
* Now this is where TOD really would get a huge volume of hits. *
This, and several other articles are classic -- is there a collection of them somewhere? Has anyone converted them to PDF?
Thanks for all the hard work
Tom Duncan