<LNG Imports to the UKThe Oil Drum: Europe100 years of oil?>

29 comments on "120 million barrels per day will never be reached, never"

Comments can no longer be added to this story.

shez on April 9, 2006 - 7:00pm Permalink | Subthread | Comments top
Another Times article citing the same Total executive is also interesting as he actually mentions the "P" word:

http://business.timesonline.co.uk/article/0,,13130-2124075,00.html

"People are failing to deal with the reality of the price, which has nothing to do with speculators or even any lack of reserves, which are ample. "It is a problem of capacities and of timing," de Margerie says. "This is the real problem of peak oil."

The oil is there, he says, but the amount you can deliver today depends on how many wells you can drill and how fast you can deplete an oilfield, not to mention gaining the co- operation of governments, which guard access to the precious resource jealously. There is no prospect of reaching the lofty peaks that economists at the International Energy Agency, predict will be needed to satisfy world demand for oil.

There are not enough engineers, rigs, pipelines and drillers to increase current world output of 85 million barrels per day to 120 million, he says. "

0
Comments can no longer be added to this story.
ThatsItImout on April 10, 2006 - 3:12am Permalink | Subthread | Parent | Comments top

"There are not enough engineers, rigs, pipelines and drillers to increase current world output of 85 million barrels per day to 120 million, he says. "

 "It is a problem of capacities and of timing," de Margerie says. "This is the real problem of peak oil."

If that is true, then that is a completely different defining of "Peak Oil" than I have been familiar with.

The WHOLE argument of true geological peak is that it is a GEOLOGICAL problem and NOT a logistical problem.  My understanding of the Hubbert/Campbell/Deffeyes method was that it no matter how much machinery, money and manpower (the three MMM'S, which decide everything), the geology was the issue, not the logistical situation above ground.

This is of course exactly the argument that Daniel Yergin and CERA have been making, in a great turn of phrase, when they say, "the problem is above ground, not below it."  Most "Peakers" have had a field day blasting CERA for that view.  Is the new definition of "Peak" now a logistical problem?  (in other words, the oil is out there, the investment and planning just fell apart?)

Gentlemen and any Ladies present, we need to call a forum.

Allow me to close by saying that I HOPE our French friend de Margerie is correct, because that is a hugely different problem than "geological Peak", and gives us FANTASTIC investment opportunity!

0
Comments can no longer be added to this story.
DamianB on April 10, 2006 - 4:24am Permalink | Subthread | Parent | Comments top
I think that the production and processing constrained peak is important because it signifies that the oil industry is aware of the geologically constrained peak; why would they invest in increasing production capacity if the rate of peak flow is upon us? Note also that all the new refining capacity is being built in the ME, no doubt to refine the heavy oil that western refineries reject.
0
Comments can no longer be added to this story.
maxoil on April 10, 2006 - 7:18am Permalink | Subthread | Parent | Comments top
""Is the new definition of "Peak" now a logistical problem?  (in other words, the oil is out there, the investment and planning just fell apart?)

Gentlemen and any Ladies present, we need to call a forum.""

Peak oil is an economic problem caused by a logistical problem caused by a geological problem.  These must be considered together.

We find and extract the biggest and best fields first.  These biggest and best fields are limited in number due to geological factors.  Geological history has also left us with a huge variety of small, hard-to-find, deep, remote, sour, viscous, hot and otherwise undesirable fields.  As we move from the best oilfields through the mediocre and on to the remainder then we need to use increasing levels of a variety of resources to extract the oil. Also as oilfields get old they demand more resources to maintain production.  The resources utilised include oil, other energy, good people, metals etc.  Most commentators agree we have more than 1 giga barrel of oil left, in that sense there is no lack of reserves, however we lack the ability to extract this oil fast enough, which is the logistic problem.  We can't drill enough wells fast enough to get the oil out fast enough.  Also if it takes a hypothetical 1000 barrels of oil to find and drill an oil well then all oil pockets of less than 999 barrels of oil will get left in the ground.  Extra resources cost extra money so the price of oil goes up. As oil extraction declines demand outstripping supply causes shortage and again prices go up.  These price rises in turn cause demand destruction, after which prices could fall as users find a different way to run their affairs.  If it costs more to drive to work than your salary you will eventually leave your job, move house or go bankrupt.

I think if humanity set itself the task it could achieve 120mbd within geological and logistic limits . Perhaps by using nuclear powered drill rigs and pumps.  However it would require a dedicated allocation of resources that would not justify the returns i.e. it wouldn't be economically or politically feasible.  Working for a target of 120mbd is not as desirable as putting a man on the moon.  The collapse in production after a 120mbd peak would be a special thing too.

0
Comments can no longer be added to this story.
ThatsItImout on April 10, 2006 - 3:51pm Permalink | Subthread | Parent | Comments top

  Before we go any further, let's look at an amusing little post that a poster listed as Biffernon gave me in reply to my remarks about where the oil money is going.  These are photos of construction and boom times in Dubai, and please scroll through them, and think about the EROEI on these projects.

http://forum.skyscraperpage.com/showthread.php?t=101057

Now we are being told that there is not enough steel, workforce, or money to continue increasing oil production.  There seems to be a lot of resources in Dubai, but we will leave that, and allow me to play through my issue here,  that being a true understanding of the use of the term "Peak Oil".

Let us take a sample oil field, it doesn't matter where.  It is reasonably simple in construction, take if you like East Texas in the U.S. or Ghawar in Saudi Arabia.  You find it, you study it, you estimate it's reserves in place, you drill it.  Now, as you drill, you find out more how it behaves, you learn reservior pressures, and you get an even better idea of it's size and composition.  You adjust your early numbers, and look at what is ultimately recoverable and how much will someday be left in place, because you can never get the last drop.
A good geologist (a Colin Campbell or a M. King Hubbert) can give you a pretty good estimate of total quantity, and calculate depletion rate, and know that at half of Qauntity, the production will begin to fall.  In fact, sooner in many cases, if you do not introduce technology.  That technology has been mostly directional drilling, and the mother of all recovery methods, water injection.

But that only speeds the depletion, so if beginning point of drilling was year 1, and original halfway was year 50, with the field trailing off to almost year 1 production by year 100,  the introduction of water injection pushes production so that half way point moves to year 25, and the field trails down to year one production by year 75.  These numbers are of course examples only, and give a somewhat expected progression.

NOW, HERE IS THE IMPORTANT POINT:  This is not, repeat NOT a logistical problem.  You can keep adding drills, manpower, money, etc., and you will only speed the depletion, AND the production will NEVER COME BACK UP TO YEAR 50. Once you have drank a half a mug of beer, you will never get more than a half a mug out of that one (you can search for new mugs, but that one is over half gone!)  That is my understanding of Peak Oil.

Is it possible that our French friend is misunderstanding the term?
Remember, he is talking about new projects.  Is he talking about completely new fields?  Because if he is, THOSE FIELDS CANNOT HAVE REACHED PEAK INDIVIDUALLY.  Now, if there are not enough of them being found to cover the depletion rate world wide, that's a different issue, AND DECIDEDLY NOT a logistical, money, manpower, or machinery issue.  

And here's the clincher:  If he is talking about enough oil recoverable to match or exceed the depletion rate being out there, and just needing the investment to get it, then it is a logistical problem.

 But if he is saying "the oil's out there" but then saying the discovery rate is not matching the depletion rate, then for all practical purposes the oil is DECIDEDLY NOT out there in the needed volume.  He is simply incorrect.  There may be trillions of barrels, but what we need to know is this:  If you had 10%  more money, manpower, machinery, would oil production go up 10%?  If you had 20% more, would oil production go up 10%?  IF YOU HAD TWICE AS MUCH MONEY, MANPOWER, AND MACHINERY, HOW MUCH WOULD OIL PRODUCTION RISE?

Because that will set the definition:  On the day the oil people can shake their head and say, "I don't care if you gave me a thousand times more money, manpower, and machinery, the total production of crude oil will never be higher than it is today."  THAT IS TRUE GEOLOGICAL PEAK.

Right now, the public is very, very suspicious of the words of oil companies and governments.  The confused language, back tracking, mixed terms, and back biting by the industry assures us one thing:  almost no one is buying into the Peak Oil idea because even those who use the term use it in so many contradictory ways.  

0
Comments can no longer be added to this story.
oilgirl on April 10, 2006 - 7:28am Permalink | Subthread | Parent | Comments top
It doesn't sound to me like he's talking about solely about 'logistics'. To talk about 'capacities' is to focus attention on how many barrels per day of net energy you can produce rather than the misleading focus on total reserves. I think he's right to use the term 'peak oil' in this context. It seems to me that peak oil will express itself in logistical and EROEI terms long before the capacity limits are seen as explicitly geological in nature.
0
Comments can no longer be added to this story.