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DrumBeat: December 30, 2006
Posted by threadbot on December 30, 2006 - 10:05am
Topic: Miscellaneous
Infrastructure is real issue affecting oil prices
Despite the warnings of peak-oil theorists that the world has reached its oil production zenith, we know that crude oil worldwide remains abundant. Reserves have continued to increase and are now 17 per cent higher than in 1994. Production has increased 20 per cent to meet demand.But can higher levels of production be sustained? Worldwide spare capacity is tight and at its lowest levels in 30 years. The real issue impacting crude oil price are the limitations of worldwide petroleum industry infrastructure.
Investments in oil production infrastructure are estimated by the International Energy Agency at $800 billion a year to keep pace with projected worldwide demand. This amounts to a massive $20-trillion investment injection over the next 25 years. And over that period, hundreds of billions more will have to be spent on refining infrastructure to produce the energy products that lubricate world economies.
Explosion In Nuclear Energy Demand Coming
There are a lot of people looking at the supply situation going forward while underestimating future demand. They are very optimistic that mining projects are going to go as planned. We had recent news that Cigar Lake had a problem. There was a flood. There’s a couple million pounds shortfall to most people’s models for at least two years. All because of one mine’s six month delay.
The Worst Could Be Over For High Oil Prices
The economy-wrecking nightmare of skyrocketing oil prices may be coming to an end, with cheaper $50-a-barrel oil becoming the norm through springtime.Energy analysts say that hair-trigger trading - which had threatened in the summer to send crude soaring to $100 a barrel - has become virtually obsolete almost overnight as investors have grown immune to bad news.
Energy czar rethinks rural Alaska's future from home to generator
As energy czar, he is concerned with rethinking energy. Period. Conservation is central to his solution, which includes searching for alternative energy sources such as wind and geothermal. Even nuclear energy isn't out of the question, he said. These are all intended to achieve one thing: weaning villages from diesel - the rustic elixir of rural Alaska.
Motiva shut Port Arthur coker on pipe leak-filing
Peak Oil Passnotes: 2006 - A Year of Confusion
When oil was hitting heights in August we here at Resource Investor mansions predicted that crude would be back at $61 at Christmas. Of course the markets do not open on Christmas Day but when they did on Boxing Day – December 26th - both the Nymex and Brent closed on exactly the same price, $61.10. You can stop applauding, thank you.
India: Razing Farms for Auto Factory Creates Battleground
Just beyond the city limits, a patch of land where an auto factory is planned amid a sprawl of potato fields and rice paddies has become the battleground for the world’s longest-running democratically elected Communist government.
India: Govt. to allow naphtha as fuel to beat crisis
The State government of Andhra Pradesh on Friday decided to allow the four gas-based power producers in the State to use naphtha as fuel to augment generation to meet the power crisis. Naphtha is costlier, but the State will immediately get 280 MW additional power. Naphtha is also easily available.
One of [Tim Flannery's] conclusions is that we are today in an anthropocene period, in which human activity is one of the patterns shaping our climate. What may surprise you is when this era began.
When is a conspiracy theory not a theory?
While GM was mobilizing the Third Reich, the company was also leading a criminal conspiracy to monopolistically undermine mass transit in dozens of American cities that would help addict the United States to oil.
At Michigan State University, students are developing "Energy Crisis," which looks at such issues as the consequences of switching to renewable energy sources, said Brian Winn, co-director of the school's Games for Entertainment and Learning Lab.
Expansion: Energy Industry in 2006
Strong crude oil and natural gas prices flowed through the Permian Basin's oil fields in 2006 as almost $20 billion from the production of crude oil and natural gas -- as of October -- funded significantly higher drilling activity and oil and gas well completions.
Analysis: U.S. nuke energy expands in 2007
The U.S. nuclear power industry ends 2006 optimistic as what has been dubbed a nuclear renaissance is on the horizon and applications for the first new nuclear plants in more than two decades are expected to be filed in 2007. But the head of the U.S. Nuclear Regulatory Commission is warning stagnant funding from Congress could slow the regulatory process and push back nuclear energy expansion.
Oil prices end 2006 where they started
WASHINGTON - Oil prices settled above $61 a barrel Friday to finish 2006 roughly where they began, marking another tough year for energy consumers and another stellar one for the petroleum industry. It was the fifth straight year in which oil prices were higher than the year before, on average.
Byron King: Strategic Thinking and Strategic Planning
Looking forward, what is the strategy for a Peak Oil world, if not for a post-Peak Oil world? Strategic thinking can look forward and identify a profound problem, as worldwide production of fossil fuels such as oil and natural gas hits a peak, bumps along a plateau and then commences an irreversible decline. But what comes next? Exactly. What comes next? The strategic question is, What is the desired end state?
We've added a new presentation titled "Taking Hubbert Home: Moving to Regional Energy Models" (ppt, pdf). In this slideshow we start to wrestle with some of the factors that separate one region's energy future from another's. We also introduce our Road Map to the Dynamic City as a framework in which we can nest discussions about depletion and regional energy planning.
Gazprom-Belarus gas talks resume
A Belarusian official said the ex-Soviet republic was hoping for a new agreement on supplies of Russian gas by a Sunday deadline, but there was no outward sign of progress in the bitter price dispute that reflected worsening relations between the two nations.
Energy priority as Germany assumes G8 presidency
Analyst: Russia has recognized and discovered that the energy weapon is a far more potent weapon than a nuclear device could ever be.
Poll shows Australian PM out of step with public opinion on atomic power
A respected Newspoll published in The Weekend Australian newspaper Saturday found just 35 percent of respondents supported the construction of nuclear power plants in Australia — down from 38 percent when a similar poll was conducted in May.
Senegalese Head Urges Angola to Contribute to Poverty Reduction in Africa
The Angolan authorities and people have been invited, through an appeal made by the Senegalese Head of State, Abdoulaye Wade, to sponsor a plan aimed at securing electricity supply to the whole continent, at reasonable cost.
Seoul to double foreign energy investment in '07
Korea said on Friday it will invest 355 billion won ($381.9 million) in 2007 to secure foreign energy reserves, more than doubling the amount from this year as part of its push to cut dependency on overseas production.The amount is up 115 percent from this year's 165 billion won investment, a statement by the Ministry of Commerce, Industry and Energy said.
Korea is pushing to produce 18 percent of the country's oil needs from Korean-owned oil fields by 2013, against 4 percent now.
Bio-fuel project nominated for energy prize
Biogas for Viet Nam, a project designed to reduce the country’s reliance on fossil fuels by harnessing fumes from rotting garbage, is in contention for a 2006 Global Energy Prize.
President Bush Signs Oil, Gas Pipeline Safety Bill into Law
October Ethanol Production Ties All-Time High: Yearly Production, Demand up more than 25 percent
PetroChina '06 Gas Output to Rise 21%, Seen Up 22.7% '07
Fossil Fuel Watch - Meet My Solar Dryer
A year ago my wife was firmly in charge the household laundry. Now, not only am I washing and drying all our clothes, including the sheets, towels, and pillow cases, I find myself looking forward to doing it. What is going on here?
Researchers: Warming may change Amazon
RIO DE JANEIRO, Brazil - Global warming could spell the end of the world's largest remaining tropical rain forest, transforming the Amazon into a grassy savanna before end of the century, researchers said Friday.
Southeast Asia rains to disrupt palm oil production
Heavy rains and localised flooding in Indonesia, the world’s second-largest palm oil producer, may curb output even as demand for the commodity rises, the Indonesian Palm Oil Producers Association said on Friday.
Silicon, Solar Power and Corporate Responsibility
Silicon is the second most common mineral element on earth. It has been widely used since antiquity in construction, metals refining and glass manufacturing.More recently, it has become a fundamental element in the production of an extraordinary range of everyday consumer goods and intermediate industrial products, including healthcare Latest News about healthcare items; fabrics; automotive, marine, aerospace engine and electrical components; telecommunications equipment; semiconductors; and solar PV cells.
Despite its abundance, the production of refined metallurgical silicon -- various grades of which are used to manufacture semiconductors and solar PV cells -- is costly, complicated and energy-intensive.
Stuart (Staniford),
In "The Auto Efficiency Wedge" (quite an excellent post) I posted a comment that got buried waaaay far down in the comments thread and it's something that's kept me wondering so I'm going to ask it here.
In several spots of the post, you note where VMT resumes vigorously after the the oil shocks even though price remains high. My question is how much of the drop in VMT during the '73? and '78? events was attributable to the actual shortage of gasoline? That is to say...did the prices that gasoline reached then have any effect on VMT or was it merely the actual shortage which caused the changes?
Aren't you asking a question about buyer psychology? The VMT drop, and rebound, were based on perceptions of price, future price, US economic position, US strategic position, etc.
We'd need surveys to know what people could say about their motivations at the time, and if you don't trust people to understand their motivations even that won't help ;-)
What I personally remember was a price and scarcity (closed stations, even/odd days) [driven] change in mass psychology. Something we've only seen briefly (post-hurricanes, etc.) since then.
Aren't you asking a question about buyer psychology?
Yes and No. Essentially what I'm trying to figure out is: If the price of gas had multiplied, but supply remained ample...would there have been any appreciable change in VMT during those times. To make that speculation I'd like to know what amount of change actual scarcity had on the times because without fuel, VMT necessarily drops whether anyone would have bought fuel regardless of price or not.
Like Joule I remember "experienced" scarcity, with longer waits at gas stations. My fuzzy memory that it was only bad on a few of the days, with the family sending me the kid to wait in line. I'm sure you've also heard that there was a temptation to "keep the car full." Some have suggested later that the even/odd days made this effect worse.
I really don't know how to answer your question beyond that. If you want to ask me anything else about my 30 year old memories, shoot ...
(BTW, I cleared my cache/cookies in FireFox 2.0 and noticed a strange effect. I see fewer posts at TOD until I log in again.)
I worked at a gas station at the time of the first crisis. I remember the odd/even and closed sunday controls. I remember the line extending around the block. The station eventually put a $10.00 limit to "play fair" and avoid hording.
I remember cancelling long trips where the chance of getting stuck without gas were avoided. Gas was expensive at R.56/P.64 a gallon. Minimum wage was 1.65
The prices of large 4x4 pu's dropped dramatically in the 2nd crisis. The combination of high fuel and high interest on car loans. Truck prices recovered when gas prices dropped.
Based solely on my own experiences during the 1973 and 1978 oil shocks, I would have to say that the inconvenience and uncertainty of obtaining gasoline for one's car had a far greater immediate impact than the increased price of that gas. Many people would have paid double the going price just to get gas at all.
When you have to wait in line for two hours to gas up, you are not going to use that hard-earned gasoline frivolously. I recall that my wife and I even cancelled one holiday visit because the distance was such that we would not have been able to make the round trip on a single tank, and we were afraid of not being able to get gas for the return trip. I'm sure we were not the only ones to curtail travel plans.
Then, of course, there were certain localized economic disruptions caused by the short-term shortages, and these in themselves probably had a damping effect on VMT.
I also recall forming a car pool with several fellow workers who lived in my area. This, however, was disbanded shortly after the crisis was over.
These were all chronic short-term effects, and in themselves do not preclude there being some longer-term, less dramatic effects resulting from price increases alone.
Those gasoline disruptions of '73 and '78 are a good reminder of how easily and how quickly everyday life can turn to shite.
The long term trend of suburbanization (since metasized as exurbanization) remained unchanged during the 1970s (although it slowed down, see VMT growth slowing from 3+% annual increases 1950-1972).
What we saw was, in military/political terms. was a tactical shift in the face of oil shortages; but the US Gov't long term strategic goal of more suburbanization/sprawl remained unchanged.
To those that doubt my characterization of sprawl as a government objective, do a thought experiment. Imagine cities that you know with zero limited access highways in built up areas (the tolled interstate highway bypasses this city with exits every 20 or 30 miles, and a six lane street leading from the sole exit on the edge of town), a handful of six lane streets with red lights and the rest two & four lane streets.
Add in mixed use zoning and mortgages that encourage dense housing near mass transit.
No change to the "free market", just changes in gov't actions.
Sprawl, and rising VMTs, are the result of gov't policies, which went unchanged in the 1970s (and today by and large).
Alan
I'm not so sure I'd view the continuing trend of expanding suburbanization after the 70s oil shocks as the result of deliberate government policy.
I tend to think it was more the result of LACK of government policy coupled with a built-in presumption that suburbanization was the only logical way to absorb the expanding population. Prehaps it was just a matter of government neglect.
Also, don't forget that the in the 1970s most of the major US cities were still experiencing 'white flight' as the result of urban decay, rising crime, and and variety of intractable racial and social problems. For a lower- to middle-class family, living in a major urban area during the 1970s (with memories of the urban riots of the 1960s still fresh) was not the most pleasant experience.
Packing more people into already troubled and highly stressed urban areas simply made no sense, other than from a purely energy consumption standpoint. (I'm still not sure it makes much more sense even today.)
You are exactly right. It is all result of public policy neglect. To complete your point - the other fundamental reason you cite - rising crime and racial problems is also a logical result of government neglect and disinterest. US government has never had the goal of tackling these problems via social policies - its primary goal has always been creating a secure growth-oriented corporate environment. Corporate heads and multimilioneers don't really care about the beggars on the streets as long as their taxes are low.
The resulting fundamental problems in the society, suburban sprawl among them, are starting to show up now - when the growth phase is approaching to an end and the resources to keep poverty apart suddenly become scarce... it is of course an overused comparison but the same thing happened with the Roman Empire when it started running out of slaves. The barbarians came in.
Yes. A screaming sign of deathly conservatism, a defense of an old state of affairs, in function both of some, but only some, corporate and business interests (these in turn being shaped by Gvmt. policy in return for what are basically bribes) and a championing of ancestral ‘core’ values - the right to act as if land use, energy, success and opportunity can never be limited materially or socially changed, even if, today, such myths don’t have the expected effects (eg. social mobility in every old EU country is higher than in the US, poverty in highest in the US amongst developed countries, etc. ...)
It is really quite surprising that the US has turned out be a bastion of conservatism, inflexibility, rampant bureaucracy and ‘big state’ (not in aid paid to the poor), military domination, a kind of war economy - in view of its reputation of pragmatism, inventivity, hard work, egalitarianism, a can-do attitUde.
Not that the EU (Japan, Aus, etc.) is any better, but the US, as an emanation of it, and as the supposed ‘hegemon’ is on the front line both for action (Iraq invasion) and criticism.
IMO the main problem is not so much conservatism but rather what some call "demosclerosis." Few constructive plans can get through our the U.S. House of Representatives and the Senate, because the veto groups acting on behalf of vested interests are too strong, and what we've had for decades is worsening gridlock. Complicating demosclerosis are the short-sightedness of politicians (dominated by concerns of the upcoming election) and the rational ignorance of voters (rational because one vote is unlikely to affect the outcome of an election).
When republics fail there is usually a Caesar waiting in the wings.
Couls Sprawl also have been a defensive tactic against limited nuclear war? Spreading out the population and industry instead of having dense cities probably made it harder to bomb out USA.
But if that were a major reason every ten garage or so would be a fallout shelter with a meter of concrete in the walls and ceiling.
During the cold war we had such a planning for a threat equaling WW-2 style terror bombing or limited nuclear war. Most new apartment houses in large or strategic towns were built with bomb and fallout shelters. Old city cores were complemented with public shelters, the largest ones held 20 000 people see http://www.bunkertours.co.uk/Stockholm%20CD%20Shelter.htm
New shelters like infilling in light industrial areas and single house areas by tearing down garages and building standardised bomb/fallout shelters with garage doors were made at least untill the late 1980:s.
There were also plans duringthe early cold war to evacuate city population to the countryside. We also had a civil defence organization like the one Dresden would have needed in WW-2. All of it is gone now in the post cold war draw down, all exept some civil defence for the grid and the shelter stock that still is maintained although new houses are no longer required to be built with shelters.
Finland have kept the same type of shelter program running and still build new shelters, they probably also have an intact civil defence system. I am very impressed by the Finns, I wish Sweden were run in such a competent way as Finland. Switzerland probably have more and better shelters then Sweden.
Thinking about wasted cold war investments makes me quite sad, about 200 billion dollars over 40 years to prepair for a war that, thank a deity, never came. Wonder if we will start doing post peak oil and global warming investments with the same determination?
Back to topic, I dont think the threat of nuclear war lead to a change in city planning in Sweden.
During the 1950s sprawl was seen as increasing vulnerability to attack by possibly inaccurate intercontinental ballistic missles. There was a "Scientific American" article (I think from the mid-fifties) that advocated building cities in the form of elongated strips along highways to minimize damage from a massive atomic or thermonuclear attack. This idea went nowhere, along with building bomb shelters in back yards.
What worked to prevent war between the Soviet Union and the U.S. was the doctrine of Mutually Assured Destruction. Alas, I see no comparably powerful policy to minimize the threats from Peak Oil. The U.S. fiddled and sprawled for more than thirty years after 1973; I think it is now much to late to avoid major pain of transition. But for the twentieth time, I shall repeat: I am not a doomer.
I have to suspect that the growth of the suburbs seen in an accelerated animation would be essentially indistinguishable from the growth of mold (or yeast?) across a fruited plain, with all the planning you would expect from it. It followed the easiest paths, and filled in any spot within reach (of the somewhat-planned Interstate Highway System) where the housing spores could stick to the soil, and that with the glue of cheap petrol, this included of course dusty deserts, high mountain retreats and sodden, marshy coastlines that get swept through every few years with harsh wind and storms..
A bit of a confusing article, but that's quite alright, it's just because the experts contradict each other every second word.
One thing, however, remains: Shell is hurting.
Another "little" matter that I don't see mentioned in the press, is the announcement a few days ago that Shell and the 2 Japanese partners are on the hook for the additional costs. They estimated $10 billion, signed a deal with the Russians, and before the ink was dry, upped that to $20 billion.
If they're paying all of that, they lose, since Gazprom payed just $7.45 bilion for its 50% stake.
Let me guess, it's 0.8 years at today's consumption levels which implies no demand growth, right?
Re: Infrastructure is real issue affecting oil prices
Expect to see more stories like this and more stories along the lines of "If only private companies managed OPEC reserves. . . "
To which I reply: the post 50% of Qt annual decline rate for the Lower 48 and the North Sea (both areas managed by private companies) has been about 2% and 6% respectively.
Since I am in the Oil Bidness in Texas, I am not arguing against private ownership of resources. I am arguing that what drives the oil bidness and the Hubbert Linearization method is the rise and fall of large, old oil fields. Regardless of whether the reserves are managed by Republicans, Socialists, Communists, or Worshipers of Britney Spears, the relentless depletion of giant oil fields trumps economics and politics.
BTW, have I mentioned lately that it is a near certainty that all four of the current super giants are in decline or crashing?
Don't forget the Roger Stern's recent comments about Iran.
Tehran, Aug 29: Iran will miss its 2010 crude oil production target by 500,000 million barrels per day (BPD) owing to a lack of investment in ageing oil fields, the press today quoted a top oil official as saying.
and
Report: Iran oil profits could dry up by 2015
... hostility to foreign investment wishing to develop new oil resources could destabilize Iran, Stern said.
... “The one thing that would unite the country right now is to bomb them," Stern said. "Here is one problem that might solve itself.”
500,000 million?
Yep, just another example of the blame game: anybody but ourselves...
I love this: They must have attended the CERA school of misleading propaganda.
How much is up to 10% Is that equal to 3.5%? 333e3*42*365/145e9
What exactly do these numbers mean 12.89 and 8.36? is that the increase expected from each group?
I read that and thought the same, couldn't believe it. Where are these nonsensensical numbers coming from? Any ideas? It reads likes in ten years World oil production will be only 21 million bpd. And CERA says this? That makes them the doomer of the doomers. Will wonders never cease.
Speaking of infrastructure...
There was a commentary in my local paper today, Power Gridlock, concerning the need to address looming problems associated with the electric grid infrastructure especially as it relates to the information technology sector. It was written by two attorneys, one of whom is the former CO Public Utilities Commmission chairman. It seemed to be a very grounded commentary. Perhaps the Peak Oil community is beginning to make headway in steering the debate toward pragmatism and realistic expectations.
A factoid I found quite interesting concerned the amount of electricity internet search engines use:
Several server farms are being located in semi-rural areas along the Columbia River in Washington State. Here is just one example of several.
Hello Yosemite Sam,
Yep, the electricity and resources dedicated to on-line video game playing along with off-line videoplay on Wii, PS3, Xbox 360, etc is mind-boggling. EnergyBulletin had a recent article that compared the gameplay as equivalent to Brazilian electrical usage!
If one examines the current global death rate of early, non-natural deaths--> it is one person every two seconds [approximately 85% of them are children]!!!
http://www.starvation.net/
If every videogame character died at this global rate; if you had to restart gameplay every two seconds-- I think most kids/adults would be too horrified to play videogames.
Just imagine if the money, energy, and time spent on gameplay could be diverted to bicycling, tending relocalized permaculture, and other necessary cultural changes to support the Biosolar Paradigm Shift. We need to start moving 60-75% of the labor force to my hoped-for 150 million wheelbarrows. Otherwise, it will be 150 million rifles and machetes. That won't be fun; it will be worse than any videogame I can imagine.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
One person with a rifle can control twenty or more with wheelbarrows. My guess is that the future hard times will bring far more inequality than we now have.
Those with guns will be citizens--those without peasants or serfs. NB, I don't want this to happen, but it seems to me a far likelier scenario than thousands of people constructively and cooperatively powering down.
Currently private security is one of the most rapidly growing "industries" in the U.S. I expect this trend to continue for many years. Those who rule the rent-a-cops may become our warlords.
Hello Don,
Thxs for responding. I agree--that is why I am primarily a fast-crash doomer [realist], but I will keep emailing, posting, and advocating for change until I cannot afford my computer-- a concerned person has to try and modify people's behavior.
After I abandon the WWWeb: I hope the TOD archives with all the great TODer suggestions, along with all my wild & crazy ideas, will finally be put to good use to optimize our decline. Even if TOD can save one million youngsters by 2100 along with a number of other species--it will have been worth the effort.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Bob, I share your desire to give the young a chance. I've noticed that kids like to pass petitions around, like this one for government attention to peak oil:
http://www.petitiononline.com/PeakOil/petition/html
I would sign it and pass it to my email address book, but it's for the UK.
Leanan, could you maybe set up such a petition for the US and put it on the TOD homepage links list? I think it would be a tool for exposing a lot of the unaware public to PO (people will FWD to their friends).
Errol
Bob, I share your desire to give the young a chance.
But american kids ARE given a "chance", much better than rifles and machetes : Oklahoma Full Auto Shoot
America! The more I know it the more I LOVE it, from a distance...
If you think that way it will happen that way.
If you want to talk about guns it's because you basically like guns and want to see them used.
You get the future you deserve.
It's usually just wanking from people who would be as helpless as anyone in a real war of all against all.
"You get the future you deserve."
Does that apply to the future of people living in Darfur or Zimbabwe?
Boy do I disagree, I think you have to look at human struggles everywhere. Violence is not uncommon. Does anyone have the link to the blog by the guy who lived during the Argentine economic meltdown?
Old Hippie - you need to read the above. very very informative IMHO
Isn't a gigawatt a unit of the rate of power consumption, not total electrical energy consumed? Do these authors know their units?
Of course technology doesn't stand still.
and i'll tell you the first thing they do with the savings.
they use it to buy more of them considering it a hedge against future surges in load while at the same time use more electricity then before.