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First Draft of an article I'm working on follows. Any comments?
Note that a couple of people commented yesterday that the HL method may be too optimistic.
Could Saudi Arabia Be More Than 70% Depleted?
by Jeffrey J. Brown
In the captioned article, I argued, based on “Khebab’s” technical work, that Saudi Arabia in 2005 was, based on the Hubbert Linearization (HL) method, at the same stage of depletion that the prior swing producer, Texas, peaked, in 1972.
Because we have so much data for Texas, we can get a fairly accurate estimate of Ultimate Recoverable Reserves (URR), probably about 62 billion barrels (Gb), or what I will call Probable URR.
In the article, I noted that Texas peaked in 1972 at 57% of probable URR. Recently, Robert Rapier, on The Oil Drum, has raised some questions about what could have been predicted prior to the Texas peak. As a result of the questions that Robert raised, I have gone back and reexamined the data, and I have come up with some troubling conclusions.
When I first did a HL plot for Texas, I used the data from 1958 through 2004 to get an estimated URR of 66 Gb. Khebab used a slightly different set of data to get an estimated URR of 62 Gb. In any case, the Texas data show a strong linear pattern from 1958 to 1965, with an inflection from 1966 to 1972, where the plot again showed a strong linear pattern.
Qt is an estimate of URR, based on the HL method. If we focus on Khebab’s HL plot, a linear plot using the 1958 to 1965 data would have given us a Qt that is reasonably close to the Probable URR. However, if we use the 1958 to 1972 data, it would give us a Qt of about 85 Gb, about 37% larger than the Probable URR.
Saudi Arabia has shown a strong linear pattern from 1991 to 2002, with an inflection from 2002 to 2005. If we use the data from 1991 to 2005, it suggests that Qt is approximately 186 Gb.
However, if we use the Texas model, and discount the recent inflection, which is probably an artifact of the swing producer maximizing production prior to the peak, it suggests that the Saudi Qt is only 150 Gb, which in turn suggests that Saudi Arabia is now over 70% depleted, with about 40 Gb in remaining recoverable reserves.
Texas:
http://static.flickr.com/44/145149303_e59bbf9890_o.png
Saudi Arabia:
http://static.flickr.com/52/145149302_924470eaa7_o.png
Jeffrey J. Brown is an independent petroleum geologist in the Dallas, Texas area.
E-mail: westexas@aol.com
WT:Your article is well written and easy to read. It appears that you are unsure which HL is more accurate, so I would mention both along with the average of the two methods (64-65% depleted).
Brian,
I think that Robert and I were both on the right path, but we were asking the wrong questions.
IMO, the right question is: What portion of the Texas HL data set prior to 1973 (when the decline started) would result in a Qt estimate close to 62 Gb? The answer is the strong linear data set on the Texas plot from 1958 to 1965.
The implication of this is that the 150 Gb estimate for Saudi Arabia is probably more accurate than 186 Gb, which puts Saudi Arabia at about 73% depleted, which means that we are really, really screwed. In any case, if you plug in the recent production data, they would fall close to the 150 Gb projection.
IMO, this is not a drill. I think that the crisis is upon us, and I think that it will be worse than most of us have been estimating.
Your analysis is excellent. I see people using every upward deflection of the HL curve as proof that the URR is larger. This is wishful thinking. The system is closed as far as the oil is concerned so there cannot be only positive deflections. You demonstrate that in all likelihood the URR is estimated best by HL data that arises during the normal production regime and not forced transients when production stalling starts to become apparent. These forced production regimes show increased production and delay the peak but they do not create new oil. What you extract faster today, you will have less of tomorrow.
Of course if we had enough HLs for enough fields "deflections" could be studied -- average length, degree of deflection, etc.
It would be nice if some HL curves were shown for truly end-of-output conditions. In the Texas case I expect the HL curve to start heading down in the next few years for a URR below 70 Gbl instead of keeping at its 2006 trend towards a URR higher than 70 Gbl.
Now I'm really worried. I already felt your export model was 100% right on and was a stark warning, but if SA is really 73% depleted, we are screwed.
Watching all of the geopolitical jockeying that has been going on the past 5 years amongst the major world players, you can't help but come to the conclusion that something major is up. Before that, gas was cheap, oil wasn't in the news, and there was RELATIVE world peace.
Okay, no rest for the weary. Back to the farm.
Cheryl
Hi Cheryl,
BTW, I meant to say how much I enjoyed your talking about your gardening success with the neighbor girls. Much support.
Thanks! We've worked our butts off the past year. Digging holes in lava by hand is no small task. But we've planted more than 50 fruit trees, and in less than one year at least 30% are already productive. We have fresh juice and fruit every morning.
We still have about 50 mac nut trees, so although they are a bitch to crack by hand, we do have a source of oil and essential fatty acids. And when avocados are in season, they can't be eaten fast enough by the whole population here. Most of them rot on the ground.
The vege garden has been out of control and we can't give it away fast enough. My husband keeps joking, "but the seeds are so little." It helps that he has a green thumb. I would never have been able to do this by myself, so hats off to an old man who is willing to do massive amounts of physical labor every day. It was my idea and I made this whole adventure happen both financially and physically and told him he was either with me or without me, but I was packing up and going. Needless to say, he's here.
I figure we will be in a good position when the SHTF, but the biggest worry will be all of the have-nots in the area. We can help some, but not all of them. And as I've mentioned before, while we are working our butts off, most of our neighbors are drinking beer and watching ESPN. The other night the Twilight Zone episode about the bomb shelter and the neighbors who didn't prepare was on. Gave me the willies. There are a lot of retirees here who just don't seem to have a clue--they think they are going to live out there retirement with ease.
I do suspect that when TSHTF, many of the retirees will leave. Right now it is still very easy to fly back and forth to the mainland to see family/friends and get medical care that isn't available here. I think many of the retirees will go back to the continent to be close to family and medical care.
It's of note that the airline industry has had major fuel problems the past few years, with many airports running out of fuel. About 1 year ago, the main island carriers, Aloha and Hawaiian Airlines both cut back dramatically on inter-island flights. It should have been a wakeup call, but it wasn't. Since I'm a former air traffic controller, I kind of follow stuff related to the airline industry. It never ceases to amaze me at how ill-informed most everyone is. Pretty much everyone thinks it is and will forever be "business as usual."
Nice work, Jeffrey.
Gremlins appear to have eaten my copy of Twilight in the Desert. I seem to recall Simmons starting with the pre-ARAMCO-nationalization reserve estimates and coming up with something in this neighborhood.
As mentioned yesterday, coupling HL with other estimation methods can help select a good data set to use.
Let me see if I follow this logic:
Observation: Texas production will seemingly max out at about 62 Gb. The 1958-2004 Texas HL analysis gives a bit more than that, but there is a linear region prior to peak (6-7 data points) which seems to give an intercept closer to 62Gb.
Conclusion: This short linear region is more "Hubbertian" than the inflection (never mind the error bars on the value of Qt from so few data points, or what it means for that line to have a different slope than the latter 25-year linear region).
Observation: Texas was the swing producer. KSA is now the swing producer.
Conclusion: The inflection period reflected Texas' efforts to maximize production prior to the peak. Thus, the HL for KSA should also show a "Hubbertian" region followed by an inflection as they try to maximize production prior to the peak. Indeed, HL for KSA has a linear region from 1991-2002 followed by an inflection, which can be ignored in estimating Qt.
My Observation: To me, this underscores RR's point that concluding anything definitive from HL of KSA's production data is very problematic. WRT Texas, it seems more likely that, if production for any time period follows a geology-constrained model (Hubbert), it would be right before and over the peak--before they knew what was hitting them. Before then, production was constrained by the TRC. With KSA, you seem to want to focus on a decade when oil prices were crashing through the floor, call that the Hubbert-constrained region, and write off the upswing that happened as prices were climbing. In effect, you're saying that ramping up production after years of steady production, for whatever reason, is a sign of desperation. I would call it wanting to take advantage of increased demand.
Because of the economic and political factors that it cannot account for, the Hubbert model clearly cannot explain production trends over certain time periods, and there is no justification for excluding data which doesn't fit your expectations. Just because it's linear on an HL plot doesn't mean that it is "Hubbertian".
You should read my posts on Roberts thread. This is exactly how HL should be used. I.e only use the points that fit the underlying assumptions not try to fit all the data.
You need reasonable and defensible criteria for excluding points. But the is the right way to do HL.
If you want to use all the data even if it does not fit the criteria for HL then use a different model.
Assumption: KSA is peaking.
Test: use only data points that show KSA is peaking.
Conclusion: KSA is peaking.
Brilliant.
This is a combination of the logical fallacy of Begging the Question (assuming what you're trying to show) and of the data-analysis fallacy of Cherry-Picking (only using data that shows the conclusion you want).
The result is a completely invalid method of analyzing data. Let the data tell its own story.
Well, you can do that...but it ain't science, pal. In the words of a 70's glam-rock band, "You're fooling yourself and you don't believe it".
Wasn't it John F. Kennedy who said:
Let's all do our part to perpetuate what ever delusions we have, lest they be forgotten and fall away into the dust bins of history.
Praised be the giver of all BS. Amen.
(BTW, there is overwhelming scientific evidence that my deity, the Holy BS Giver exists. Just look all around you. The proof is there. The Flying Spaghetti Monster, on the other hand, is a fraud. ;-)
Can you repost this out of the drumbeat as a regular article soon.
Also I mentioned buried in Roberts thread just recently.
http://www.theoildrum.com/node/2357#comment-168542
This may be relevant.
the most important concept i get from HL is that as basins, regions and the globe matures the size of the fields discovered gets smaller, resulting in a peak. i tend to give less weight to the statistical evaluation of production/demand data sets.
some think that "new and improved" technology will somehow result in ever increasing production capacity. but wait just a damn minute: HL, has historical "new and improved" technology built in. sure, we will see "new and improved" techniques and we have seen tremendous impovements in technology in the past , generally resulting in an ability to find ever smaller reservoirs.
we should not loose sight of the fact that ghawar was discovered based on surface geology, the new and improved technology of the day