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25 comments on Peak Oil Letter from Energy Minister

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westexas on May 11, 2006 - 9:37am Permalink | Subthread | Parent | Comments top
Back to the Texas case history, higher oil prices + more drilling + 14% more producing wells = 30% less production 10 years after the peak.  We found more oil, and we are finding more oil in Texas, but we couldn't--and can't--make up for the declines in the large, old oil fields.  IMO, this is why we can compare Texas & the Lower 48 to Saudi Arabia & the world.  

To give you an idea of how deep the denial goes, the Texas State Geologist (a government employee) said at a public meeting, in response to a pointed question by me, that while "we may not be able to equal our peak production, we can substantially increase our production through the use of better technology."  We have never, not once, shown year over year production increases since we peaked in 1972.  So, 33 years after peak production, government talking heads were talking seriously about the possibility of getting back close to our peak production.

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zceb90 on May 11, 2006 - 11:28am Permalink | Subthread | Parent | Comments top
For the benefit of readers of this UK section who may not have seen this item on Wed. open thread on parent site I'm reproducing key section here; it would be good if your state geologist could read this report:

Bad news for economists:

http://www.economics.rpi.edu/www/workingpapers/rpi0512.pdf

Abstract: In this paper we use results from the Hotelling model of non-renewable resources to examine the hypothesis that technology may increase petroleum reserves. We present empirical evidence from two well-documented mega-oilfields: the Forties in the North Sea and the Yates in West Texas. Patterns of depletion in these two fields suggest that when a resource is finite, technological improvements do increase supply temporarily. But in these two fields, the effect of new technology was to increase the rate of depletion without altering the fields' ultimate recovery - in line with Hotelling's predictions. Our results imply that temporary low prices may be misleading indicators of future resource scarcity and call into question the future ability of current mega-oilfields to meet a sharp increase in oil demand.

Similar steep declines following extensive application of EOR have been noted elsewhere, for example in Prudhoe Bay and Yibal (Yemen). Link to full thread: http://www.theoildrum.com/story/2006/5/10/103434/143

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25 comments on Peak Oil Letter from Energy Minister

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