The Oil Drum

http://www.policypete.com/Misc/DOEandCANADA1.htm

Comments by Roger Blanchard:

The US Department of Energy/Energy Information Administration (US DOE/EIA) has a history of providing poor forecasts as illustrated in their International Energy Outlook 2003 (IEO2003) forecast for Canada. In the IEO2003 they stated:

"Canada's conventional oil output is expected to increase by more than 200,000 barrels per day over the next 2 years, mainly from Newfoundland's Hibernia oil project, which could produce more than 155,000 barrels per day at its peak sometime in the next several years. Canada is projected to add an additional 500,000 barrels per day in output from a combination of frontier area offshore projects and oil from tar sands."

Assuming the total increase of 700,000 b/d for Canada was for the 2003 to 2005 period, the US DOE/EIA was only off by 710,000 b/d. In 2003, Canada's total liquid hydrocarbons (TLHs) production was 3.11 mb/d and in 2005 it was 3.10 mb/d (US DOE/EIA data/I used TLHs data because they include NGLs in their forecasts), a decline of 10,000 b/d. If the baseline was 2002, then they were off by only 555,000 b/d. That's not bad for the US DOE/EIA. I had made what I thought was a good case in my book that Canada's oil production would not increase by anything approaching 700,000 b/d for the 2002 to 2005 period.

It is interesting to see that Canada's oil production decreased 29,000 b/d in 2005 (US DOE/EIA oil production data). Part of the decrease is due to prolonged shutdowns in production from oil sands operations, which seems to be a persistent problem. Production has also decreased in Atlantic Canada due to declining production from the Hibernia and Terra Nova fields (Hibernia actually had a peak of 204,264 b/d in 2004). Atlantic Canada's oil production declined from 336,885 b/d in 2003 to 304,847 b/d in 2005. The White Rose field was brought on- line in Nov. 2005 so that will slow the decline of Atlantic Canada's oil production.

The US DOE/EIA is projecting that global oil production will not peak before 2037. I would not bet any money on their forecast.

Roger Blanchard Sault Ste. Marie, MI

Leaving unmanned damaged property exposes the owner to lawsuits in case a trespasser gets injured, so it'll make sense to scrap them and get some money for the steel and/or useful artifacts resold as surplus. Or, if that's not feasable, sell them for a buck to a church, like so many companies did with abandoned factories. A derelect platform is surely loaded with hazards, so you outsource the lawsuit hazard to a schnook church.