GAO Peak Oil Report Thread
Posted by Super G on March 29, 2007 - 12:38pm
Topic: Supply/Production
Tags: GAO [list all tags]
[Update by Leanan] The long-awaited GAO Report on Peak Oil [PDF], courtesy of EVWorld [EVWorld link replaced by official GAO link.]
Much more under the fold.
[Update by Prof. G] Here's a link to a video of Matt Simmons discussing the GAO report on CNBC, peak oil, and the ramifications from yesterday (7 mins). This is a very important video for those learning about peak oil, it's balanced and it's a great primer!
The report also got a mention this morning on WaPo's Politics Hour.
Arlington, Va.: You probably won't take this question, because its not on "the list," but I'll ask anyway hoping that someone will look into it and maybe we'll see some follow-up someday. There is a press conference today by Reps. Roscoe Bartlett (R-Md.) and Tom Udall (D-N.M.), between 11:30 am and 12:00 noon in HC-9 of the Capitol to discuss the release of an embargoed GAO report. The report will reveal the United States is particularly vulnerable to and unprepared to respond to severe consequences from an significant disruptions to world oil supplies from peak oil and other above-ground political and economic factors, which are viewd as an increasing risk. Some very real questions are how "severe" the consequences are and what "increasing risk" means -- and why no mainstream press will cover this.Lois Romano: I can't tell you that the press won't cover it. It certainly sounds like a story the way you have described it.
What list??
[Update by Super G] Coverage by the AP, Energy Bulletin, Green Car Congress, the WSJ Energy blog, Yahoo, and Salon.
UPI: GAO: Lack of clear policy on peak oil (via Energy Bulletin).
[Update by Prof. G] Congressman Bartlett will be leading a Special Orders tonight between 4:30 pm - 5:30 pm Eastern (it's going to be on CSPAN at some point, not sure when...) to discuss the release today of the GAO report about peak oil.
A most interesting chart in the GAO report is on page 13. It shows estimates of the timing of peak oil, according to 21 studies reviewed by GAO.
Ten of the 21 studies say that peak oil will be reached before 2020, and no later. Four additional studies say that peak oil may be reached before 2020, or sometime later. Seven of the 21 studies say peak oil will be reached after 2020.
I could be wrong about study (n), it's hard to tell if the date for that one is supposed to be 2020 or 2025.
Seven of the 21 studies say peak oil could be now.
Here's the chart:
And here's the key:
This appendix lists the studies cited in figure 5 of this report.
(a) L.F. Ivanhoe. “ Updated Hubbert Curves Analyze World Oil Supply.” World Oil. Vol. 217 (November 1996): 91-94.
(b) Albert A. Bartlett. “ An Analysis of U.S. and World Oil Production Patterns Using Hubbert-Style Curves.” Mathematical Geology. Vol. 32, no.1 (2000).
(c) Kenneth S. Deffeyes. “ World’s Oil Production Peak Reckoned in Near Future.” Oil and Gas Journal. November 11, 2002.
(d) Volvo. Future Fuels for Commercial Vehicles. 2005.
(e) A.M. Samsam Bakhtiari. “ World Oil Production Capacity Model Suggests Output Peak by 2006-2007.” Oil and Gas Journal. April 26, 2004.
(f) Richard C. Duncan. “ Peak Oil Production and the Road to the Olduvai Gorge.” Pardee Keynote Symposia. Geological Society of America, Summit 2000.
(g) David L. Greene, Janet L. Hopson, and Jai Li. Running Out Of and Into Oil: Analyzing Global Oil Depletion and Transition Through 2050. Oak Ridge National Laboratory, Department of Energy, October 2003.
(h) C.J. Campbell. “ Industry Urged to Watch for Regular Oil Production Peaks, Depletion Signals.” Oil and Gas Journal. July 14, 2003.
(i) Merril Lynch. Oil Supply Analysis. October 2005.
(j) Ministére de l’Economie Des Finances et de l’Industrie. L’industrie pétrolière en 2004. 2005.
(k) International Energy Agency. World Energy Outlook 2004. Paris France: 101-103.
(l) Jean Laherrère. Future Oil Supplies. Seminar Center of Energy Conversion, Zurich: 2003.
(m) Peter Gerling, Hilmar Remple, Ulrich Schwartz-Schampera, and Thomas Thielemann. Reserves, Resources and Availability of Energy Resources. Federal Institute for Geosciences and Natural Resources, Hanover, Germany: 2004.
(n) John D. Edwards. “ Crude Oil and Alternative Energy Production Forecasts for the Twenty-First Century: The End of the Hydrocarbon Era.” American Association of Petroleum Geologists Bulletin. Vol. 81, no. 8 (August 1997).
(o) Cambridge Energy Research Associates, Inc. Worldwide Liquids Capacity Outlook to 2010, Tight Supply or Excess of Riches. May 2005.
(p) John H. Wood, Gary R. Long and David F. Morehouse. Long Term World Oil Supply Scenarios. Energy Information Administration: 2004.
(q) Total. Sharing Our Energies: Corporate Social Responsibility Report 2004.
(r) Shell International. Energy Needs, Choices and Possibilities: Scenarios to 2050. Global Business Environment: 2001.
(s) Directorate-General for Research Energy. World Energy, Technology and Climate Policy Outlook: WETO 2030. European Commission, EUR 20366: 2003.
(t) Exxon Mobil. The Outlook for Energy: A View to 2030. Corporate Planning. Washington, D.C.: November 2005.
(u) Harry W. Parker. “ Demand, Supply Will Determine When World Oil Output Peaks.” Oil and Gas Journal. February 25, 2002.
(v) M.A. Adelman and Michael C. Lynch. “ Fixed View of Resource Limits Creates Undue Pessimism.” Oil and Gas Journal. April 7, 1997.
AFAIK, several of those are note original & independent estimates, but rehashes of each other, based on the same USGS inflated OPEC data.
I think they would have done the estimates section a more truthfully, if they had included only separate, original methodology studies there.
Then again, was truthfulness or "calm down, it's 30+ years away" their goal :)
Am I missing something, or has the Lynch 1997 study ("v.") been left off the chart?
The report has a footnote that the conclusion of study "v" (Lynch) was that timing for peak oil was "unknowable". Kind of hard to put that on the graph!
Following up on our thread the other day, what if we average these dates? I tried eyeballing and averaging the midpoint of each of the ranges, got about 2024 for the year of the peak. If we take out the two extreme optimistic ones that center at around 2070, that brings the average in to 2019; however that may be a little pessimistic because it is taking estimates of "after 2020" and "after 2030" as just being those dates, 2020 and 2030.
The bottom line is that averaging the experts puts us around the 2020 time frame. Pretty far out compared to most opinions around here, but then this is a self-selected group. You can find similar groups on every controversial issue, convinced that their own opinion is right and insisting that the expert consensus is either mistaken or a case of outright disinformation.
Halfin: Every day that passes without global crude supply topping the monthly peak set in 2005 lowers the credibility of the distant forecast peaks. IMHO, a Vegas book would give heavy weight to the fact that prices are high and oil supply is stuck at the 85 plateau. These studies quoted have different agendas which have nothing to do with accurately predicting the date of peak oil, which lessens their usefulness, IMHO.
Nice report from the GAO, and like most reports from the government, it is 5 years behind. We already know everything in the report. "The future of when peak oil happens is uncertain" - that took a lot of study to say, ha ha ha. The end of the world is uncertain too. We must recognize that peak oil is certain, and start doing something productive instead of trying to calculate the exact date. We are losing precious time every day that goes by. We are wasting money on wars, exotic, unrealistic plans, and other political B.S. instead of spending on a real solution. Teach everyone how to grow food in their yard so they won't starve. Learn how to live without cars and planes. By the time global warming heats up by 1 degree, we will be out of oil. The earth can protect itself. Go back to nature.
Nowhere is Now Here!
From the chart, we can derive a probability density function:
Below is the cumulative density function (cdf):
There is 5% of chance (F05) that PO data < 2007, 50% of probability that PO data < 2034 (F50) and 95% of probability that PO date < 2114 (F95).
Nice work! I'll repeat the reference to the survey paper on the advantages of combining forecasts:
http://faculty.fuqua.duke.edu/~clemen/bio/Published%20Papers/13.Combinin...
To me, this clean, simple averaging approach is far more likely to be a good guide to the truth than Stuart's efforts to read the tea leaves of every jog and squiggle in the Saudi production function.
Thanks for the article, it's a good reference.
Note that the maximum likelihood derived from the pdf above is between 2012 and 2017.
Right tool, afaik, but GIGO.
Look at the data going in.
If they had included all the CERA/IHS/USGS rehash studies, they could have pushed the probability of <2034 to near zero.
What we need to feed is:
- independent (i.e. done without other studies data)
- different methodology (e.g. bottom up, HL, economic, loglets, whatnot)
- credible (i.e. now back of the envelope calculations)
...studies. Also, for balance measure, we would probably need also to include some earlier estimates that have been proven wrong (too early), because it is likely that some of the other late peak estimates are wrong too (assuming somewhat normal distribution, even if tailed).
Then we MIGHT get some useful data. Perhaps. Agree?
Sounds like a plan. I'd love to see that done.
IMO, exactly right SamuM. A mean calculated from results produced with such disparate methodologies, has little value. Many of the studies (e.g. CERA) use data or assumptions that are demonstrably incorrect, or use methodologies that are irrelevant. Such results should be excluded from any mean that is calculated. Even then, a mean is of limited significance as most Contributors who have done detailed analyses and leading commentators (e.g. westexas) seem to be homing in on a narrow window of "nowish" to 2010.
The most interesting thing about this, is that it raises awareness of this probability amongst the MSM. It will be interesting to see how this develops and its effect on oil prices (now towards $66), esp. combined with Iran's antics with the captured sailors. It's almost as if they are trying to stir up antagonism and strengthen excuses for an attack later this year.
I don't necessarily agree that you want independent data in this kind of averaging. If many experts agree with a particular line of analysis and write papers supporting each other, then it makes sense to take the fact that that is the widespread consensus into consideration. Anyone who fails to recognize that near-term Peak Oil is very much a minority view is deluding themselves. The averaging process should reflect that reality.
Always with the sexy graphs... :o)
Is it possible to redraw the pdf/cdf charts in 3D with depth representing which underlying data set was used (USGS, etc)?
In other words the analysis is too flat, equally weighting all the studies.
Great way to look at the data! I question your methodology a bit though. Shouldn't the forecasts spread over mutiple years only contribute a fraction to each year in the PDF? The way you plotted it, the total area in the plot represented by the studies with large ranges is disproportional to the area representing rest of the studies. Doesn't this overweight the studies with large ranges?
Note if you do the PDF/CDF the way that I suggested F05 is 2005, F50 is 2022 and F95 is 2053. I eyeballed the data off the chart so the numbers are probably +/- a year or so.
Can someone point me to a tutorial for posting charts?
Thanks.
You must first find a place to host your image (Google "Image Hosting" to find a number of free sites), then use the "img" tag. Here is the tag Khebab used for his first graph:
<img src="http://www.theoildrum.com/files/GAO1.png">
Note that if you are using Mozilla Firefox, you can select a section of rendered text and graphics and use the "View Selection Source" command to see the underlying HTML. You can use this to figure out how to do something someone else has done. You can do something similar in Microsoft Internet Explorer.
I don't think you can host an image at the Oil Drum unless you have special privileges (see "Personnel" block on the right-hand sidebar).
hmm... good question. What would be the weight then?
Each study has the same weight for each year (i.e. 1/18). A study with a large time span (e.g. 2005-2140) would be basically non informative because it would then affect each year the same way (i.e. it would simply raise the minimum probability floor). Note that I have not included the studies that are just saying "After 2030", If I include them I get F50 around 2050.
IMO, studies that are including shale oil should have lower weight for instance because there is a low probability that this source will affect the peak position.
Coincidence? Oil spiked at 12:00, was this when the report was released?
Probably not a coincidence.
Lot's of things are pressuring oil prices right now and it's on a "parallel track" to oil prices from last year (just lagging a little). Gasoline prices are also on a parallel track (leading last year's prices a little).
But the price of oil and of gasoline have come closer to their historical alignment that existed prior to July 2004.
http://articles.moneycentral.msn.com/Investing/FindHotStocks/11StocksFor...
Even MSN Money is talking Peak Oil:
"While there's no real consensus on the issue, many experts advise that global oil production has more or less peaked. While they sound spectacular when announced, new oil finds, at best, compensate only for the depletion of existing reserves."
Highlights of the report now at Energy Bulletin (in HTML):
energybulletin.net/27919.html
Bart
Energy Bulletin
I think this report is real progress. It's an even-handed summary of the debate, recognizes that the issue is potentially very important, and says the US govt should be doing a lot more to reduce the uncertainties and respond despite the uncertainties. I think this is a huge improvement from the EIA AEO's and the like, which essentially have a "no worry" message. The message here is "Worry!" I also like that the various demand-side alternatives discussed are all ones worth discussing (no "rebuild the railroads"), and that the challenges to rapid implementation of any alternative are discussed in a reasonably balanced manner. I also liked the pervasive discussion of the fact that these things need to be thought of light of the global warming implications (they even used "global warming" instead of "climate change"!) I thought the arbitrage between food prices and gas prices implied by ethanol should have gotten more play, however.
This is much more important than the Hirsch report, because it's not a contractor-done "Opinion of the authors only" thing. A very credible piece of the government has just officially endorsed that this is a huge issue. (And thus that I haven't been throwing away my reputation for nothing these last two years, and I'm happy about that).
I don't endorse exactly where the center of gravity of the report is (My reading of the evidence is that we are more-or-less at peak already, but I also think adaptation is not going to be as hard as some people think). But despite that, just the legitimization of the debate is a big deal.
Re: center of gravity
I welcome the report. Worrisome excerpt —
Not all predictions are created equal. The timing of the conversion rate of reserves is the important thing. The GAO has gotten off on the wrong foot here.If someone says there are 4 trillion barrels out there, does that mean that the peak won't be in the near-term?
No.
There are emotionally laden sea change moments when life as one knows it changes irretrievably. The pregnancy test is positive. The US Supreme Court throws the election to Bush. The biopsy reveals cancer. In what ways and how quickly ones life will change after such moments is unclear. What's clear though is that there is no longer any doubt that big changes are definitely coming.
I'd say that reports like the Hirsch report and the GAO report are rapidly building towards such a sea change event in media and public perception of PO: after which it'll no longer be will PO happen, it'll be when will PO happen.
I think that we're passing through this PO perception sea change now. Interestingly, sea changes are also occuring in other major areas, such as the global climate crisis, the US housing industry, the US Congress, and the Iraq war. Key societal elements are becoming fluid that were for a long time frozen.
Citizen, NGO, government, academia and business PO efforts should rapidly shift emphasis from sounding alarms to delivering solutions, otherwise what's the point. PO is winning the war of words, now it must deploy practical solutions. I'm reminded of what Gandhi allegedly once said, "If God ever shows up in India he'd better show up as a loaf of bread rather than the Word."
virtuallygreen:
I agree we need to *deliver practical solutions.* And as a concerned citizen I have already begun to implement "practical solutions." However, the devil is in the details of what I and like-minded other humble citizens consider *practical* versus what the affiliated organizations you mentioned consider *practical.*
Lower down this page Bob Shaw, aka: tononeila offers 8 organizational ideas of his own, some that I consider (on the whole if not exact detail), not only practical but also probably necessary. Yet, I think that most NGO's, government, academic and business organizations as presently configured would not consider any such ideas as at all *practical*
Furthermore, as you note about the possible sea change now happening, the perception is still only one of slight degree: "it'll no longer be will PO happen, it'll be when will PO happen." That's precisely the wrong way to address this AFAIC.
Not only are there too many supra-organizations with inherent institutional reasons, all interlinked, and all structurally and socially arranged on life with oil, not without it, that they'll argue the *when* PO point and all the devilish details of *what* to do about it *when* (always later than now), that, more than likely, very little and too late will it happen to be *practical* as originally envisioned.
Despite the rising tide of awareness, it is still a slow rising tide of corrosion that is lapping at our shores. This PO tide is certainly sending out breaking waves of sentiment that are both sounding and appearing ominously closer on occasion, but unless there is a sudden and undeniable PO tsunami type shock wave, one that knocks us off our feet and sucks away a lot of our organizational and humanistic arrogance, I don't expect much from these fossilized organizations in the way of delivered practical solutions.
When it comes to "delivering solutions," I'm primarily betting on those that will of necessity arise from individual actions against most all of the present organizational ones that will be flogged. IMHO, most all of the solutions necessary to be of any real practical use will not come from the halls of academe, businesses, or governments as presently arranged, but arise from individual efforts fully cognizent of PO's vast ramifications while rooted to their home or regional base.
The sweeping organizational solutions that we could use will be seen as impractical, while those that are considered practical won't be enough or delivered as sold. In this, both irony and tragedy will have their way.
The solution will start with individuals. But individuals influence one another. People will see how their neighbors are acting and some of them will come on board. Finally, when enough people have changed, institutions will jump in. Of course, there will be some institutions that will work against every step of the process.
Why no "rebuild the railroads?"
Hi Beto,
There was a guest article on this. (I'd look it up for you, but am having perpetual problems w. this sort of things and still finding my place.) Just use the search function and "rail". Or, perhaps someone else will jump in here. Also, look up "Arthur Smith" and/or "Energize America". And see Alan Drake.
It's a good idea, IMHO.
This whole thing reminds me of the way that I do arithmetic now that I'm in my dotage: I add up a column of numbers three times and then take the average.
And here's the NASDAQ story:
US Auditor: Energy Dept Should Develop Plan For Peak Oil Era
Let's use the most optimistic date shall we?
Meta: Actually, using the most optimistic date, the line would be "should occur by 2040". "Could" occur by 2040 implies to an uninformed reader that world oil supply might rise indefinitely, infinitely, until the universe implodes.
Right. They could alternatively have said "could already have occurred."
Interesting report. A lot of the discussion revolves around reserve number estimates. Very few discussion about actual flow rates which is the bottom line of peak oil. The list of countries that have passed their production peak is getting longer and longer.
That's right. Here's what I said at PO.com:
I was just about to say the same thing.
Glad you used the word flow. Peak Oilers should use the word "flow" rather than "production". "Flow" is much more visual. "Production" is a technical abstraction with certain degrees of separation from the phenomena being