<The ASPO Conference - Final Afternoon The Oil Drum DrumBeat: September 23, 2007>

147 comments on Peak Oil Update - September 2007: Production Forecasts and EIA Oil Production Numbers

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Fractional_Flow on September 21, 2007 - 11:39am Permalink | Subthread | Comments top

Nice work and that 13 forecast average for the Crude and condensate is a neat, very intriguing projection.

FF

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westexas on September 21, 2007 - 12:31pm Permalink | Subthread | Parent | Comments top

I think that you will find his net export projections to be even more interesting. He did a low, middle and high case for both production and consumption, resulting in a range of nine estimates for when consumption = production in key exporting countries. It's not a pretty picture--to be delivered at ASPO-USA.

The three key points that we will emphasize are:

(1) Once a region peaks, only a small percentage of post-peak production will be exported (for the ELM, about 10%).

(2) Net Exports decline much more rapidly than overall production declines (-28%/year and -5%/year respectively for the ELM).

(3) A Net Export decline tends to accelerate with time (from an initial year over year decline of -12.5% for ELM to a final year over year decline of -47.5%).

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davebygolly on September 21, 2007 - 1:58pm Permalink | Subthread | Parent | Comments top

Yes, this, but also hoarding. (I don't like the word with its negative connotation -- squirrels hoard to survive.) The rise in the price of oil will overwhelm the incentives to invest in extraction -- letting it just sit there will give a far better return (putting it in purely financial terms, which I don't like either). This too will amplify the dropoff as well as amplify the likelihood of far wider and bigger war.

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memmel on September 21, 2007 - 2:33pm Permalink | Subthread | Parent | Comments top

We have plenty of use for the remaining oil even if its to expensive to waste driving SUV's. It will still be a valuable commodity for a long time. I doub't it will ever be cheaper than it is today for very long. The time scales of moving off of oil even with major breakdowns are longer than the depletion curve. So outside of total collapse oil will be a expensive item for the foreseeable future.

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oilmanbob on September 21, 2007 - 9:14pm Permalink | Subthread | Parent | Comments top

memmel

These are thoughts that I don't have the maths to quantify. As the Export Land Model kicks in, there will be a rapid distruction of the export capacity because no one can afford to keep up seldom used tankers. They might be used as loating storage tanks, or just scrapped out by the owners.

The same will be true for dock facilities, the chemical plants and rfineries will need a lot more storage if they are open, but many more will be scrapped and the specialty vslves and steels in the process piping recycled for use elsewhere. The field engineers and crews who know how to set up and operate the tanks and pumps will be scattered, perhaps to become people with entirely different job skills like farming or shoe repair. Permanent changes will soon hit the downstream segment of the industry. With changes like these, we might see quick, permanent demand distruction that permanently depressed the price of crude. Stuart Staniford was suggesting that this could happen in his post a couple of weeks ago.

Bob Ebersole

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memmel on September 21, 2007 - 11:01pm Permalink | Subthread | Parent | Comments top

Good points. This is along the same vein of my concern about the oil industry itself in a high price oil environment. Expensive oil will have a negative impact on our ability to pump oil. Your talking about later on.

I'd say overall your probably right. Actually the worst problems are not crude itself but refineries. Its a huge investment to create and maintain a modern petrochemical refinery and the downstream plants. These do not scale well.

Well you just managed to lower my doomer quota a notch. I think your right. However I've been a big fan of micro scale reactors for chemistry but these make more sense with biofuel to plastic/jet fuel etc.

http://en.wikipedia.org/wiki/Microreactor

So believe it or not I'm still optimistic.
Actually on that matter most people think I'm a super doomer I'm actually not. Our current lifestyle is unsustainable and we need to make major changes. In the short term we will have problems but a sane modern lifestyle that is low impact is quite possible and doable. The only sad part is probably at a much lower population level than today.

Even high estimates of sustainable population indicate that billions will probably die so we are looking at more people dying in a short period of time then have ever died in our history even WWII pales in comparison. So on on hand I'm optimistic and think eventually we will live within our plant on the other outside of miracle we are probably facing the darkest period in human history.

So for me the saddest part of our current culture is it has encouraged a unsustainable living pattern throughout the world its not the wealthy man having problems fueling his SUV but the poor farmer who now cannot get goods to market or fertilizer because he became dependent on oil. Everyone is addicted to oil and we will pay the price.

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oilmanbob on September 22, 2007 - 3:33pm Permalink | Subthread | Parent | Comments top

memmel,
we will definitely pay a huge price, but the die-off predictions seem improbable to me except from the threat of war. About 1/5th of the world's population lives in India, Pakistan and Bangladesh on the arable land which is about the same square kilometers as the US east of the Mississippi. But they don't do it in 2,000-5,000 square foot McMansions driving a SUV, the diet is vegetarian mostly with dairy products, and the lifestyles of the poor aren't very long. In China I don't have a comparison of the arable area, but its equivalen. They have a bunch of non-arable areas like Tibet and the central Asian deserts of Inner Mongolia and other northern and western provinces (thats western from a chinese viewpoint) which don't have the water to farm.
I don't know any real way to estimate the wealth of the US, but we have 300 million people on about the same area. It lets us eat a carnivorous diet, have clothes and shoes only limited by our closet space, and closets the size of huts housing whole families in rural Asia. We have free public education through high school, and could be free in the Universties too with our social wealth and with accessable loans and grants. We fall down badly on public health, but its still better and more acessable than over half the world. We are rich, yet many people say our lifestyle is "non-negotiable" and we are threatening the world with resource wars instead of conservation. Bob Ebersole

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Pitt the Elder on September 22, 2007 - 4:14pm Permalink | Subthread | Parent | Comments top

the diet is vegetarian mostly with dairy products, and the lifestyles of the poor aren't very long.

The lifestyles of the poor aren't likely to be all that short, either, since life expectancy in India is 68 years. Less than the 78 years of the West, but not terrible. (For comparison, China clocks in at 73 years.)

In China I don't have a comparison of the arable area, but its equivalen.

From the links above, China's land is 15% arable, or 1.4m sq km, while India has 49% of its land arable (one of the highest percentages in the world), which gives them 1.45m sq km. So it's within a few percent.

For comparison, the US has 18% arable land, giving it 1.65m sq km, but has a shorter growing season (since it's further from the equator).

many people say our lifestyle is "non-negotiable"

Does anyone have a link to the original statement? All I've ever been able to find is people's (angry) responses to it, so I've never been able to determine what the context of the statement was.

My guess is that Cheney was saying Americans' freedom is non-negotiable, not their SUVs, and I'd like to be able to confirm or deny that hypothesis.

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Relayer on September 22, 2007 - 5:29pm Permalink | Subthread | Parent | Comments top

I believe it was Bush that stated that the American Way Of Life is non-negotiable.

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GreyZone on September 22, 2007 - 6:09pm Permalink | Subthread | Parent | Comments top

It was Bush, Sr., not Jr., and it was apparently said at the 1992 Rio Summit in response to discussions about limiting environmental damage (including GHGs).

Ref: http://www.sourcewatch.org/index.php?title=New_World_Order

Note: You can find other references as well but I can find no direct quote for this either. Of course, in 1992 not everything was immediately sucked up into the WWW either. However, the attribution makes much more sense (to me, at least) as it is not as vacuous as the supposed Cheney statement and is precisely the sort of thing I would have expected from Bush Sr. and the conservatives at that point in time.

I can find no credible evidence that Cheney ever made the statement that so many attribute to him. If someone has that evidence, I would be most interested in seeing it. Thanks in advance!

"The greatest shortcoming of the human race is our inability to understand the exponential function." -- Dr. Albert Bartlett
Into the Grey Zone

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Pitt the Elder on September 22, 2007 - 8:24pm Permalink | Subthread | Parent | Comments top

Ahh, that makes more sense.

Googling for lifestyle+not+negotiable turns up mostly links attributing the phrase to Bush Sr. at the 1992 Rio summit. The Cheney-related attributions are not only less numerous, but none I found gave an indication where or when he is supposed to have said that, making it almost certain that the source you found is correct.

Thanks for digging that up!

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Big Gav on September 23, 2007 - 10:38am Permalink | Subthread | Parent | Comments top

I think the Cheney quote that you have in mind may be this one "conservation may be a sign of personal virtue, but it is not a sufficient basis for a sound, comprehensive energy policy".

http://www.time.com/time/nation/article/0,8599,127219,00.html

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robert2734 on September 23, 2007 - 10:43am Permalink | Subthread | Parent | Comments top

Yes, but conservation is a silver BB. One more BB than the current energy "policy".

RobertInTucson

I haven't escaped from reality. I have a daypass.

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oilmanbob on September 22, 2007 - 6:47pm Permalink | Subthread | Parent | Comments top

As I recall the non-negotiable lifesyle statement was by George H.W. Bush back in the 80's when he was VP, but I sometimes have a bad memory for things like that. I won't use it again, but the point is a lot of Americans think that they are entitled to a wasteful way of life and that no one has ever had a different life in the US. Population densities can be a lot higher than they are currently without endangering life or health. And although much of the northern United States has severe winters, much of the south can have two crops a year. I was raised in Houston and live in Galveston, and around here we raise tomatos to be planted as sets right now and harvested near Thanksgiving and greens and lettuces grow all winter.

many people seem to lack a hisorical perspective. When I was a young teenager i asked my three surviving grandparents about their lives. My father's father was the eldest of 11 children, and his father ran a hotel by the railroad in Lincoln, Nebraska, had a quarter section of wheat (160 acres) and also was a carpenter. My mother's mother was the youngest of five and her father had a ten acre farm and worked in a shoe factory part time. My father's mother father was the only one in the bunch who very wealth, he had a prosperous business building streets in Omsha. My point is that most people in the US did several things to make a living, and just as Westexa suggests in his ELP idea, they ere all

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jaha on September 22, 2007 - 7:59am Permalink | Subthread | Parent | Comments top

Interesting that you should mention "seldom used tankers", just the other day I read about the richest man in norway (an owner of oil tankers) and his problems regarding alot of spare capacity in the tanker market. Freight rates are apparantly just about as low as they can go without the freighters losing money. The article says they are hoping for OPEC to increase production so they have something to put in their ships. Even more interesting, tankers are being converted to bulk freight already.

took me 20 min to find the article again on account of me thinking it was on na24.no I had read it, but it turned out to have been on e24.no :), but here it is for those of you who read scandinavian.

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Slippery Slope on September 23, 2007 - 10:22pm Permalink | Subthread | Parent | Comments top

I suspect that the oil tanker market is biased by the fact that existing single hull oil tankers must be retired by 2010. So while new conformant double-hull ships are being built to replace existing single-hull ships, there is an excess number of ships to carry the expected oil. After 2010 it should become obvious, assuming a 2005 peak of crude plus condensate, that there is less oil to ship each year and that the less efficient crude carriers will be idle.

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mcgowanmc on September 22, 2007 - 10:21am Permalink | Subthread | Parent | Comments top

"Permanent changes will soon hit the downstream segment of the industry. With changes like these, we might see quick, permanent demand distruction that permanently depressed the price of crude. Stuart Staniford was suggesting that this could happen in his post a couple of weeks ago."

A non linear event. As the Power Laws kick in.

To be preceded by and accompanied with "Shock Doctrine"
(Naomi Klein).

Even today, Klein notes, Chile remains one of the most unequal societies in the world. It's shock therapy miracle shifted "wealth to the top and shock(ed) much of the middle class out of existence."

It's the way it works everywhere and a glimpse of the future: "an urban bubble of frenetic speculation and dubious accounting fueling super-profits and frantic consumerism, ringed by ghostly factories and rotting infrastructure of a development past; roughly half the population (excluded); out-of-control corruption and cronyism; (decimated) nationally owned small and medium-sized businesses; (mass) transfer of (public) wealth (and resources) to private hands (accompanied by) a huge (shift) of private debts into public hands." Inside the Chilean bubble was paradise. Outside was "The Great Depression." Bubble-benefitters reacted with "junkie logic: Where is the next fix?"

Israel attacks Syria's just delivered N Korea
cargo with a message to Iran.

How many times did you see this headline this week:

US Devalues It's Currency

Arkansaw of Samuel L Clemens

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147 comments on Peak Oil Update - September 2007: Production Forecasts and EIA Oil Production Numbers

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