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53 comments on Oilwatch Monthly January 2009
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53 comments on Oilwatch Monthly January 2009
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Thanks for your great work. I'm not seeing any plateau or even a decline in production yet. Does even look like production is increasing, which would seem logical. Producers need more money so they increase production.
For the OPEC part, production driven by high prices would account for the 2008 growth. They're still seeing the rewards from several years of very heavy investment. The question for that market would be how long before the low prices drops investment, and then results in a step-down in production?
Non-OPEC is very worrying, though. Not only was there a plateau, but it's in the past and decline has been evident for a while, even with record prices to drive investment. Not much chance of ever recovering there, I'd say, with low prices especially.
Note that the graphs do not include any view of EROEI, or the shift to heavier crude grades.
A very important point - if we could graph such a thing it would make financial policies a bit clearer. Costs are undoubtedly coming down, but not as fast as revenues. But the data does exist on crude grades/% light sweet higher API, etc. I don't have link handy - anyone?
I'd like to see the numbers tabulated on a per capita basis too. What if there is more oil but less on a per-capita basis? Can one then say "production is keeping up"?
Then there needs to be some sort of Oil Gini - the oigini index - that measures the emergy distribution. My guess is that from a declining pie, the wealthy populations are getting disproporationally more and more.
Such meta-information won't change policy, that's set by the people at the controls. There isn't anyone else to take the controls - the controls are wrong. But it would help those of us trying to figure out what sort of controls we might need - local, local, local - to address scale, distribution and allocation.
cfm in Gray, ME pie sector 3.0719
I have submitted a paper to Nate that does just this in a very basic, but IMO critical, way. Global net per capita oil (C & C) is currently at about 4 barrels per person per year. That's down from its peak of about 5 around 1980. Peak net per capita is well behind us.
We built industrial society on an energy return of circa 100:1. We have been maintaining it until recently on a return of circa 10:1. We are now turning to sources with returns of near 1:1 (i.e. no net return). Ain't gonna work.
Cliffman, I'm looking forward to that. How far back did you run the numbers? Did you go back at least as far as it took to find Peak Oil per Person"? [POP] Just guessing, right around Apollo 13. "Houston, we have a problem."
Ain't gonna work, no. Another set of numbers that would be helpful at least anecdotally - what was "Barrels of Oil Equivalent per Person" [BOEP] of various societies at various times. Europe now is about half US I understand. US around 1960 about half of current. If society, culture and technology are all of a piece - though not necessarily uniquely so - one could solve decline rate and amount of work to replace infrastucture to find the set of True Paradigms Possible. ;^>
cfm in Gray, ME, channelling Harri Seldon.
clifman - sorry - i just can't keep up - please resend it to address on my profile. thanks
hi cliffman
I too would be interested to see your analysis. Looking quickly at the BP site it's interesting that the big drop in oil consumption per capita happened between 1979 and 1982, from 0.71 to 0.6 tonnes/person/year. 2007 was unchanged from 1982 at 0.6. For the same dates total energy consumption/capita/year was 1.55mtoe in 1979, 1.43mtoe in 1982 and 1.7mtoe in 2007.
2 immediate conclusions suggest themselves from this;
1. The big drop in oil consumption, on a per capita basis, occurred in the relatively short recessionary period 1979-1982. This probably represented genuine, irrecoverable, demand destruction (expressed/capita) and likely resulted from energy substitution, esp non-transport.
2. Since 1982 oil consumption/capita has remained remarkably steady against a backdrop of increasing total energy/capita. This suggests that oil demand may be far less elastic than back in 1979 - most of the easy substitution has happened.
TW
Figure 6 shows OPEC production rising steadily since third quarter of 2007 passing its mid 2005 (july 2005) level in third quarter of 2008.
Figure 7 shows NON-OPEC production declining since start of 2007 never reaching that level again until end of 2008. There is ofcourse a major decline then come-back near the end of 2008.
World crude oil production as shown in figure 5 is almost a balance between OPEC and NON-OPEC (I think each of them produce a half of their sum). I do see a plateau in world crude oil production since about third quarter 2007 (if we take average of production since then).
The fast rise in OPEC's crude oil production near mid 2008 is balanced by a close fall.
There seems still some potential in rise of liquid fuels' production.
On the basis of quantitive production data we can't clearly say that peak is near but on the basis of qualitative production data (all liquids are not equal, EROEI etc) we are near to peak in liquid fuel production if not passed it.
I agree. nice to see just data. draw your on conclusions. wonder how much of this went into storage?
Non Opec has clearly peaked.
US, Mexico, North Sea, even Russia seems to have peaked.
So then, OPEC, in particular two countries, Saudi Arabia and Iraq, are the two big unknowns.
Also, the notable thing is that these data sets are not complete or perfect, just an outline of what is going on.
What I see is a plateau.
hi tommy
IMO the all liquids graph is a bit misleading for 3 reasons;
1. It contains biofuels which are a disaster for many reasons and for which EROEI is probably not far from 1.
2. Non crude oil liquids contain a large fraction of NGL's which have only about 70% the volumetric energy content of crude. This component has been steadily rising as a fraction of total liquids.
3. EROEI of crude is likely falling as newer and smaller fields and unconventional oil take up an incresing fraction of the crude total.
Getting an exact number for 3 is tricky but if you take output numbers for May 2005 and compare with Oct 2008, ignore biofuels and allow for the 0.7 conversion factor for NGL's, then there is little difference in volumetric energy content (oct '08 is 0.3mbpd higher). The slightly higher figure for oct 08 is probably (personal gut-feel) wiped out by reduction in EROEI over the period.
The fairest overall conclusion is probably that liquids have been on a plateau since 2005. To appreciate this better you should really view the data without the false origin - i.e. plot on graph paper with 0mbpd as the Y-axis start point. It's then clear that the mom differences over last 4 years just constitute a noisy plateau.
On a different subject it looks as if any OPEC reduction from oct to dec 08 (-1.3mbpd) has been almost wiped out by an increase (+0.9mbpd) in non-OPEC production over the same period. No wonder the price has failed to rise over that period as the world recession deepens! And another piece of evidence IMO that the price will rise rapidly when/if economic recovery begins.
TW
I was confused by the date in the title :)
Fixed.
thewatcher, now you watch yourself! What you address here amounts to a scandal on TOD.
People might think my moniker "nopeak" is tendentious, (it was sarcastically selected) but nothing is so scabrous as TOD publishing the "all liquids" bullsh*t graph above-the-fold and pretending it comes even near to representing reality.
Per your first statement: "it contains biofuels." Indeed. This is called "double-counting." Pump some oil, count it as "liquids." Use the oil to grow some crops and use the crops to make some fuels, and count it as "liquids." No one on this site has ever shed any real light on this farrago of liquids, but there it is, above-the-fold, obfuscating the peak.
Per your second statement: "it contains NGLs." Yessum. None of this is made into motor gasoline or diesel or heating oil, and it comes from NATURAL GAS WELLS! not oil wells. This site is called The Oil Drum, but that never stopped them from obfuscating the peak ""oil"" with oodles and oodles of propane and butane.
Per your third statement: "EROEI is likely falling...." You get the award for Understatement of the Year. Let's all ignore the energy yield and pretend, with the stupendously positive "all liquids" graph above-the-fold, that a volumetric increase in "liquids" means one cussed thing.
I love you all. Now excuse me while I go makes some "liquids" on your legs.
nopeak
Please children, we are trying to keep this a "civil and professional place for discussion.
The other kids will get a bad impression if you continue......
nopeak,
Your post is unfair and inaccurate. You've been a member here for seven weeks. Perhaps you should go back and read every DrumBeat fromJan '07 to now. You will see you are way off.
Churlishness, even rudeness, has its place, but only in light of truth. You are not dealing in the realm of truth with your post.
Jeers
Deffeyes called Peak around Thanksgiving of 2005 based on conventional oil, if my memory is right. How does that play vs this report? If we're on a volatile plateau why dicker over one-half of one percent when the practical effect of peak oil goes back to 2005 (if not 1970ish).
Seems to me biofuels are NOT something that should be counted in "Peak Oil". Not unless one wants to go abiotic. Seems to me oil is oil not tarzans, not NGL, not soybeans.
cfm in Gray, ME
You are wrong. I've been reading here since the beginning. You have no basis to be so presumptuous about my readings history based merely on when I registered for this site!
I remember when the only "peak oil" sites were fromthewilderness, dieoff, and peakoil.com. By these lights, you on TOD are the johnny-come-latelys.
Funny how you and Citizen Anarchist, obsessed with the outraged tone of my post, don't address the source of the outrage. You claim "inaccuracy" and "lack of reality" and refute it NOWISE.
So tell me:
1. Does the volumetric "liquids" count employ DOUBLE-COUNTING, or not? Perpetually and ad infinitum TOD posts this graphic with a straight-face under the title "Oilwatch." A joke!
2. Does the NGL category smuggle in propane and butane from gas wells or not to obfuscate the oil picture? Hmmmm?
3. Is EROEI -- and especially per capita EROEI -- going over a cliff or not, as more and more SLUDGEY crap is "counted" as "oil" in the "liquids" category?
I call bullsh*t and will continue to call bullsh*t when I see it.
Volumetric liquids counts are bullsh*t.
Edit: BTW, there is a typo in the headline. "World liquids fuel production including biofuels" should read "World liquids fuel production including loaves and fishes."
You're exactly right, nopeak.
And so banished to the wilderness will be your prize,
like it has been the prize of Dirty Fucking Hippies since
Ronald "Trees Cause Pollution" Reagan.
EROEI is EVERYTHING.
And as I've been stating since Katrina when I came here
because of your excellent Hurricane coverage.
And your TOD reports on Thunderhorse which then disappeared after Katrina.
a blank spot between TH and March '06. And don't show me pics of
TH and Dennis damage.
AAMOF this might be the first post I read here:
#
#
The Oil Drum | Hurricane Katrina and Thunder Horse/Gulf Oil ...
Hurricane Katrina and Thunder Horse/Gulf Oil Production (Kat now potentially a Cat 4?) Posted by Prof. Goose on August 26, 2005 - 10:24am ...
www.theoildrum.com/story/2005/8/26/85755/4147 - 46k
As I said, then and now, every oil watershed/inflection point has been
accompanied by a major socio economic event to verify.
The severity matching the watershed's importance exactly.
Obama just ran out of time. Good Luck. Tick Tock.
mcgowanmc , nopeak, RIGHT - ERoEI is everything. It is everything to the cheeta chasing the gazelle. It is everything to us. ERoEI seldom counts human energy but as we move closer to an ERoEI of 1 suddenly it will become clear just as it is for subsistance farmers or hunter-gatherers. For example the ERoEI of cane ethanol is better than corn. Partly this is because the cane is burned after extracting the syrup to provide some of the energy of processing (in other words no crop residues go back to the soil so the ERoEI is being supplemented by soil depletion) and partly because the energy of the workers (food, housing, transportation) is not counted. A cane cutter is expected to cut about 3 tons or more of cane a day. If machinery was used to cut the cane the fuel for the machine would be counted. Thus in that way of accounting if we used virtual slave labor to harvest corn and didn't count the food we fed them we too could have a better ERoEI on corn ethanol.
If a solar panel factory had to pay its workers in electricity produced by some of the panels it made - had to dedicate a portion of them to "pay" its workers, it would lower the ERoEI of the panels. Of course a human's pay is more than the value of lighting and heating a house, so we would have to subtract from the ERoEI of solar some amount to run electric tractors to grow the food for the workers, etc etc etc.
What level of ERoEI we can live with and still have industrial civilization is debatable. I suspect we are getting very close. I am sure that solar and wind will NEVER have enough to sustain the world as we know it now.
All of the above are addressed time and again here at TOD. You also conflate TOD with being a monolithic entity when that obviously is not the case. There is dissension among the ranks, both among the staff and the general posting public.
You are not being truthful. You seem to have a bit of a thing going for EROEI (which is often discussed.) Understandable. But the post I responded to is edging into the fanatical. Perhaps it's warranted to push the EROEI concept. That is not the issue I raise. I am only saying being truthful is helpful to cogent discussion.
Anyway, just pointing it out. It's not my site, so it's not important to me whether you continue your tirade or not. You want to misrepresent? Go ahead. If TOD staff find it useful, perhaps they will respond.
(And, no, I'm not a lackey or boot licker here. I've had warnings and had posts deleted and have quite publicly called some of the main posts here rubbish.)
Cheers
One suggestion for counting ERoEI but first the problem.
Problem:
When calculating ERoEI we have to calculate ALL energies that we put in. This is the part which is making trouble. The other part of calculating the energy that we get out is easy and straight-forward. The problem in the first part is that we don't know to what extend we must go. It get really complicated when we try to estimate energy needed to employ one person for one month. Should we estimate energy used for entertainment (show biz etc)? What about the wastes (do the person really need a car to drive to work? etc)? Another problem is to what extend we must calculate the energy (energy going to Morocco's miner of phosphate rocks to make fertilizer to be used in rice farm in china that grow rice for the factory worker in china that made that dolls that the daughter of ceo of shell get for her birthday etc).
Solution
Subtract the energy used for hiring humans. Only calculate the energy going in producing objects (foods, cars, buildings, electricity etc) assuming that humans are doing it for free or that the work is done automatically. Ofcourse there are non-human energy consumptions in a factory and farm and even in services, things like fuels, electricity etc.
Once this is done and we have a database of estimated energy used in making each of the objects, estimate where employees are spending their incomes. People use their incomes for buying two basic things: goods and services. When a service is bought money is given to another human who use some part of it in buying goods and some part in buying services. As you move forward in the life of the money eventually all the money is spent in buying some kind of goods. Once you have a database of estimated non-human energy used in production of goods AND database of goods usually bought by the people you can have a better (though not exact) estimation of ERoEI.
Now about the wastes. To what level people can use their money more efficiently (do you really need that car to go to work? is it really necessary to go abroad on vacations every year?) would be answered differently by different people so we don't go in that discussion.
Wisdom, it is a problem (especially for first worlders) to know what to count when counting the energy of human input. In Brazil the wages are barely subsistence wages. They could just as well be paid in food, housing and cooking fuel as their wages would buy little else. For the sake of trying to count it I would use some measure of food calories for the worker and his family and the energy for basic housing and necessary transportation. When we get down to only having the really low ERoEI energy that is all that a worker is going to be able to get, just as in the past and in third world countries today.
The other problem with ERoEI is the ERoEI of the EI. Take solar, if your EI is oil it is still high enough to not affect your ERoEI but if you are trying to use solar to make solar you will need more EI than if you are using oil to build your solar panels (and run 18 wheelers and build roads etc).
Personally I think the "DOOMERS" see the world more clearly than the "POLLYANNAS" who seem regularly to miss the obvious problems with the "alternative" energies. I still have not seen a serious discussion on Electric dump trucks, earth movers, etc. The problem "doesn't exist" apparently because the Pollyannas don't want their hopeful world view shattered.
You seem to be miss reading the post to me. Its really important to understand what "the world" in general is counting as fuel.
Thank you for the post and all the work Rembrandt.
hi nopeak
Just a comment on NGL's. As I understand it (I'm sure you will correct me if I'm wrong ;-)) the bulk of these come from the gas caps above oil fields and so can technically be said to be associated with oil wells - but splitting hairs maybe.
Regarding motor fuel, it's not true to claim NGL's are of no use as there are now quite a few cars here (UK) that drive on LPG. My b-i-l has one and gets pretty impressive mpg out of it despite the lower energy content. So IMO it's fair to include NGL's in liquid fuels as long as allowance is made for lower volumetric energy content and whatever the EROEI is (anyone know this?)
TW
If we use the May, 2005 EIA crude production rate of 74.2 mbpd as the index month, and if we look at the average rate for four time periods: the last seven months of 2005, all of 2006, all of 2007 and the first 10 months of 2008 (subject to revision, generally downwards), the cumulative shortfall between what the world would have produced at the 5/05 rate and what we actually produced has increased to about 885 mb.
So, despite the vast increase in oil prices, the industry has failed to consistently match or exceed the 5/05 rate of 74.2 mbpd for any of the four cited time periods. I think that we were starting to see some voluntary reductions in production in October, but I believe that the year to date average for September was only 74 mbpd.
So, we see lower production in response to higher crude oil prices (through the summer of 2008). Where have we seen that before? Well, here are two regions that showed initial production declines in response to higher crude prices:
http://www.theoildrum.com/files/TexasAndNorthSea.png
Note that the North Sea, in 1999, was at about the same stage of depletion at which the world was at (regarding conventional production) in 2005, based on the HL (logistic) models. And the world crude production graph (2005-2008) looks a lot like the North Sea graph (1999-2002).
According to "Chart 33: EIA OPEC Spare Capacity Jan. 2003 - December 2008" OPEC spare crude oil capacity began increasing in July 2008 from 1.3 Mb/d to 3.2 Mb/d. I think some of this spare capacity is sour, but the recent increase is likely light sweet crude oil. The disruption in production caused by the fire in the BTC pipeline in Turkey, Russia's invasion of Georgia and the 2 hurricanes in the Gulf of Mexico causing the dip in production in August and September 2008 can not be attributed to peak oil. Those dips drag the 2008 average down. I suspect average crude oil production plus spare capacity increased in 2008 compared to the May 2005 rate of 74.2 Mb/d. Producers got it up a little bit in 2008 making last year the most recent peak year.
Even with a new peak year, world crude oil production is still on an extended plateau since 2005.
Thanks a lot westtexas from the behalf of all of your readers for the effort of collecting, analyzing and presenting highly useful and important information. You keep me coming back to TOD :).
Last seven months of 2005 + 2006 + 2007 + first ten months of 2008 = 214 + 365 + 365 + 304 = 1248 days. 885 mb/1248 days = 0.71 mb/day. A reduction of 0.96%, worthy enough to be valued?
Good point that decrease or plateau in production at time of high energy prices is a clear sign of peak production.