http://houston.bizjournals.com/houston/stories/2005/10/03/daily47.html

http://energybulletin.net/9510.html

My sense of things is that there is a shift among PO organisations towards a belief in a peak in the 2010-2015 time frame. Simmons is apparently still holding to an earlier peak, but if he is seen as a champion of that belief, and his predictions keep failing, then that will shift opinion towards later dates.

A 2015 peak isn't terrific news, 10 years is not much time to adapt to such a change, but it is certainly better than 2005.

i was just wondering if someone at this site could provide some educated commentary on the graph and its assumptions. it seems there are a lot more commentators here than at mobjectivist.

i wont say too much since there are others much more qualified to do so, but if that graph is right, it seems that we would be getting off lightly with a 30 year depression. or maybe this is wrong also, and the graph looks more severe than it really is?

Thanks to Reed for reposting the link to the Mike Davis climate change article.

I see peak oil as important because (with luck) it will produce obvious consequences in the relatively near term; but in a deep sense it is secondary to the linked issues of population and climate change.

Whenever anyone starts going on about alleged new large fossil fuel sources (including shale) I want to scream. If we develop any significant amount of this stuff, all it will do is to seal the planet's fate. It is a complete diversion from the truly necessary project - for human beings to learn that "exponential growth cannot continue forever in a finite world".

Everyone knows that our rulers have the attention span of hummingbirds, and that their actions naturally flow in the direction of least political resistance. Any solution to our energy problem to be at least partially successful will have to entail years of sustained effort and investment in the trillions, not billions, of dollars.

I am highly sceptical that any such an effort can be sustained, for there will inevitably be peaks and valleys in the market price of oil. The pressure to 'do something' is on when the price is high, but the  pressure is off when the price drops.

So, I think what we will see will be a perfect example of what I call the "postponed term paper syndrome". You have a long and difficult term paper to write; it is due next week but you haven't even started it yet, and you are in a panic mode.  Much to your surprise the professor anounces in class that the due date of the term paper has been pushed back a whole week. What do you do - take advantage of this reprieve and get an early start and diligently work on the term paper?  Of course not - the first thing you do is to go out drinking with your friends to celebrate, then you ignore the term paper, and eventually  find yourself next week in the exact same predicament that you were in before the reprieve.

That, I fear, is what is going to happen: once the price pressure shows some sign of relief, complacency will again set in, and we'll be right back where we started. Markets don't effectively operate beyond a certain short time frame and tend to discount the future way too heavily. In corporate America, the future is usually defined as no further out than the next quarter or so.   If the international oil companies are making money hand over fist from the status quo, what incentive do they have for making major changes to begin with?

 We are talking about radical major new infrastructure creation here, and I don't think that short-term market forces are capable of creating the incentives to carry that out. While it goes contrary to my libertarian sensibilities, I think that only a major national effort on the par of a new Manhatten Project has any chance of succeeding in bringing us relief from the effects of peak oil.

I've been thinking about how to get focused discussion on one or another topic.  Here's and idea:  Put forward a question, have a thread to discuss the question, close with a poll on various across the alternatives given in the original question.

For example.  What percentage of the population of richest 20 countries will die off due to peak oil or it's side effects?  Given 100 units of significant government investment to address the risk of peak oil which of the following five allocations of those funds would you recomend?  Or, will peak oil lead to larger or smaller urban areas?  You get the idea.

If refining bottlenecks are so huge, why was any refinery built in the USA in the last 30 years. I heard a lot about environmentalists not liking refineries but I don't think environmenatalists (or treehuggers as they are called derisively) are that powerful or more powerful than oil companies and oil consumers. If oil companies think money could be made long-term, won't they push it through somehow?

I also hear oil price is down because crudes cannot be refined because refineries are out of commission. If refineries are shut, won't that reduce the demand and thus lower the price of crude? Also, if crude is cheap, won't be good for refineries? So why do stocks of oil companies and refineries move together?

But i had a question on refineries. Since congress just passed legislation. Have oil companies really been asking for more refineries? I know the red tape has been a "choker", esp. since the environmentalist have lobbied so hard to restrict refinery bulding. "Gotta save that rare Asian Butterfly, or Mexican Beetle." Not to mention the "not in my backyard" attitude.
Or does congress think that it will actually help bring the cost of petrol down? I suppose they feel pressured to say they "did" something to help the public.

But is congress ignoring oil as a finite source? Suffice to say that more refineries will accelerate oil production, thinking that more refineries equal lower price of petrol? thereby increasing consumption.They (congress) do not appear to be really addressing alternatives to oil.

ONE of Britain's top chemical firms may be forced to suspend production over the winter because of the soaring price of natural gas.

http://www.timesonline.co.uk/newspaper/0,,2769-1817128,00.html

Many of the points are pretty standard fodder for this forum, but I find the comment on the government-mismanaged reserves particularly compelling and commonly overlooked. You can seen the massive waste firsthand in the former-Soviet Caspian (vast lakes of spilled oil held back by levees along the roadway.)

Stuart, when you're in a contrarian mood, I'd love to see some analysis on how many years your "mild case" horizon is moved out simply by engineering western free-market efficiencies into those reserves.

1. Comment on open threads:  Open threads like this are a good way to have the benefits of editorial control of a bulletin board at the top level while still allowing unconstrainted conversation to be brought in at the next level.  The editors can then cull interesting ideas and bring them to the top level later.

2. Comment on summary view:  It would be nice to have a way to view the top level posts in a summary page (e.g. just the headlines) so history is not lost in the noise.  As far as I can tell, the OilDrum only has the "next 10" at the bottom of the page.  That makes it difficult to capture history.

3. Comment on progress on sites like this:  Related to the previous two points, I think it would be nice if sites like this can show progress.  I'm not saying that there isn't progress within the conversations, but structurally all that progress, or whatever progress is made, is lost in the history.  I realize it all depends on the goals (and the time of people making the site).

4. Comment on technical bent of oil drum:  I think some of the posters who are arguing about this site as engineering centric and solution-centric are correct to a degree, but still wrong in my opinion.  First, there seems to be too much stereotyping of engineers.  They are "this or that", short-sighted problem fixers.  Some are.  Probably many.  But not all.  But humans in general are problem solvers.  Peak oil is a problem.  Solve it. It will be solved one way or another.  Nature is a problem solver as well.  And there is a technical, geological aspect to peak oil that should be considered with rampant speculation.  Therefore a site that is reality-based, in the scientific sense, and then grows from there, is much better that highly speculative ones that can degrade into noise.

5. Comment on price discussions:  I disagree with the comment that price is irrelevant, and prognostications made by people like Simmons are not relevant.  If Simmons throws price numbers around ($200/barrel in 2010 is what he said, and $10/gal this winter), he's setting up targets that, politically speaking, will erode his credibility.  He better know what he's talking about.  I don't think he does.  I think he's caught up in the hype.  Good intents, but he's shooting off his mouth.  It's probably tough being a Simmons, who tries to be reality based, when he is up against the grandstanding of Kunstler and Ruppert on the speaking tour.  Price is important.  Yes, the fate of the planet is also important.  They are interlocked.  We live in a capitalist society.  One that is not want to save for tomorrow.  Price is our only hope right now to start the transition. Kunslter can speak about peak oil till he is blue in the face, but what has gotten the eyes, ears, and pocket books of the American public is the price they pay at the pump.

6. Utopian thinking and rampant speculation.  For those who think the technical aspects of oildrum are the least interesting, I will agree at least that there are very important geopolitcal issues to consider as well.  I do not malign them when I say--as I have in the past--that I like the more technical bent of OilDrum.  The reason is that the speculation quickly runs into the weeds.  There is very little reality to it.  A lot of what ifs. Speculation about the next republican administration--do we really know that?  Is it possible the republican party will face setbacks do to all the problems that are brewing?  Possible.  All speculation.  And what do we have afterwards.  Speculation.

7. What is the key contribution that oildrum can make:?  In my mind, the concepts of survivalism, sustainable living, geopolitics, etc etc have large communities of support.  People have been considering these issues for over thirty years.  Endless manifestos and page after page of google indexing of the web exists on this topic.  Interesting stuff.  Much good stuff. But it exists.  I think the key question to ask is the following:  what areas are unique about peak oil?  And what concrete steps can a site like this make to answer questions related to those unique areas.  E.g. the work stuart--and others on other sites--are doing with modeling.  The analysis of oil production in the gulf.  Developing  a dialog with the economics community--e.g. with econbrowser.  This is exactly what should be done in my opinion.  Filling more google pages with speculation about when the US will invade Iran, whether Bush knew about 9/11 before hand, etc etc will not help in my opinion.  E.g. if someone is concerned about the 2006/2008 elections, or believes that Bush will invade Iran, and that we shouldn't--start protesting now.  Sit in front of the white house.  You will do more that way than speculating on a bulletin board on the internet. Organize.

Though this topic is a sharp departure from the thread of the last group of posts, I bring it up because lately I've noticed that a number of people (generally of a ultra-conservative and/or fundamentalist Christian bent) have latched onto this notion that oil and natural gas are not 'fossil' fuels at all but have an abiotic origin much deeper within the earth.

 Furthermore, it is claimed by proponents of 'abiogenesis' that this deep oil is continually migrating toward the surface and thereby continually replenishing existing oil reserves.  Propenents speculate that there are vast untapped reserves 'way down there' that dwarf all our known reserves of shallow oil. Their message: Peak oil is BS and we're never going to run out of oil.

As supposed evidence, the abiogensesis people claim that a largely tapped out formation in the Gulf of Mexico shows signs of being replenished, presumeable from oil formations much deeper. They also claim that the Russians have used the concept of abiotic oil to find oil in geologic formations that normally would not have been through capable of containing oil.

Not being a petroleum geologist, I have no way of knowing whether or not there is any validity to this theory. However, by way of analogy, I do know from my work in the environmental field that groundwater can take hundreds of years to migrate even relatively short distances. Therefore, I tend to think that even if oil is of an abiotic origin and indeed is migrating upward from very deep within the earth, it could take a geological time frame to substantially replenish the existing oil formations. In which case, it's not going to do us any good at all.

So, I'd be very  interested in hearing what some of you petroleum people out there have to say about abiogenesis. If the consensus is that it is total nonsense, then I'd like to have some good specific contrary arguments should I get into a discussion with an abiogenesis fan.

The Post Carbon Institute is hiring:

Job title: Assistant to Director
Organization: Post Carbon Institute & Global Public Media (Initiatives of MetaFoundation)
Reports to: Director
Terms of position: full-time (flexible) 3-month contract, beginning immediately
Location: Office near UBC, Vancouver
Salary: $4,500 (total for contract)
Job summary: To support the work of the Director of a small but rapidly growing non-profit organization by providing assistance with research, administration, and communications through the use of appropriate knowledge and technology.

God I'd love to have this job, but I'm stranded in Philly until February ;-(

If $500 is breached, it will get the attention of the media and the public because it's a big, round number. I hope that the precious metals stocks I bought last week will rise along with gold.

Now oil prices have been dropping slightly in the past few days.  And the chart doesn't suggest to me a big move up is in the cards right now.

But oil prices and gold prices are correlated in history.

While I don't know why (or even whether) the gold price will rise soon (the charts only strongly suggest, not guarantee), but if it does rise, will it be because (1) oil prices move higher or (2) the U.S. dollar moves lower or (3) because some strong inflation indicator is reported.  Or maybe gold will rise because there are lots of folks like me who read the same chart and jump aboard.

This coming week in the commodity markets should be interesting.

From this perspective, PO does not matter much, except to suggest that when we begin to produce a little less each year, prices, and increased energy efficiency, will accelerate.  This acceleration will, overall, be good for climate. Certainly had the world been blessed with as much oil as Lynch thinks, or professes to think, the affect on GW would be worse.

Meanwhile, mankind and its institutions are not capable of doing things that bring widespread unhappiness before some greater unhappiness comes along to provide the goad. Other political systems, including the Soviet Union and China, certainly never did any long range planning of this sort. Perhaps Europe gets a little credit for energy taxes, but Europe really has done little to move towards non-hydrocarbons, or even minimize their dependence on Russian sources.  Examples of delayed response with little preparation include Pearl Harbor, 9/11, the Great Depression, famines everywhere.

Many energy sources, both renewable and non-renewable, are disliked by somebody. Windmills, even solar farms, have detractors. However, when oil price increases are sufficient to cause widespread pain, the market will try to respond with solutions as a majority becomes convinced the new solutions, unacceptable earlier, are acceptable now. Nuclear fusion will clearly be widely adopted as prices of all hydrocarbons climb. As an aside, breeder reactors are a renewable energy resource whose economics, like solar, are not yet favorable.

A question for reserchers: it seems to me that high ng prices can't last, even accepting that only modest expansion of the four LNG terminals and imports can be accomplished in the short term. Current high prices are crushing the chemicals business, as Dow Chemicals recently whined. When ng was $3 in the US and $1.5 in Qatar and Indonesia, it didn't pay to move the existing chemicals infrastructure to cheaper sources. But now, with US prices ranging from 10-14, and still around $2 overseas, it seems clear the US chemicals business, along with the related jobs, tax base, and pollution, will be gone with the wind. The DOE site seemed to show chemicals consume at least 1/4 of US ng production. Does anybody have any comments?

I don't think engineers, as a group, are either optimistic or pessimistic. Their job is to do as much as possible with as little as possible, naturally based on present costs. High tech gives them better materials over time, allowing skyscrapers and jet planes. I don't think engineers have any idea whether various radical concepts, such as fusion, will ever be economically feasible, or even produce more energy than the energy inputs.

Well, while I've heard several comment to the effect that this theory is nonsense, I'm still waiting for someone knowledgeable on the topic to give me some clear concise answers in geophysical terms as to why the abiotic oil theory is flawed.

One thing I'd like to know is whether the literature on petroleum chemistry has much in the way of proposed mechanisms by which ancient biomass gradually got converted into the several relatively simply hydrocarbons that comprise petroleum. It is not at all clear to me how this took place in the relatively inert chemical environment of the shallow subsurface in which petroleum is found. How do the proteins and polysaccarides, etc.  of biomass get turned into hexane, heptane, paraffins, etc? What were the oxidation/reduction conditions during this period?

In other words, what I am asking is: how well established is the theoretical chemistry for such a conversion.  Sure, there was plenty of time available, but my question has to do with whether the chemical thermodynamics were favorable for such conversions to occur. It is not at all clear to me what actually  took place to produce petroleum.  Does anybody else know?

["The combination of the news that there's no new Saudi Light coming on stream for the next seven years plus the 27% projected decline from existing fields means Hubbert's Peak has arrived in Saudi Arabia," says Coxe, referring to data compiled by the International Energy Association's (IEA) August 2004 monthly report]

then again, further down in the article..........

[Water injection

In other words - by their own admission - Saudi Arabia will have added only 800,000bpd of supply in the next seven years. That is the best-case scenario.

To put these rates into context, the IEA predicts a year-on-year rise of 1.6mbpd by the fourth quarter of 2005.

One factor contributing to the scrutiny the Gharwar field faces is the huge amount of water injection used. Water is pumped into an ageing oilfield in order to maintain high pressure inside.

This allows the oil to be pumped out at the original constant rate. Eventually, however, the water reaches the well-head, and the field effectively dies.

Coxe goes on to ask why new Saudi fields, not just ageing ones, are also water injected.

"As if that weren't bad enough news, the Saudis claim they need at least $32 a barrel to justify new production, because ... new production ... requires water flooding. Water flooding on newborn Saudi wells? Isn't water flooding [the] Viagra of ageing wells?"

Abd Allah on the other hand states that it is modern techniques, not water injection, that will let Aramco meet any future demand. ]

http://www.independent-media.tv/item.cfm?fmedia_id=10639&fcategory_desc=Top+Stories+Ignored+By+U .S.+Media

here  it is Oct 2005, prices per barrel have not shown the pending crisis.
 Comments?

  The book is OVER A BARREL by Raymond Learsy who describes himself as a commodities trader.  He maintains that oil scarcity is a myth fostered by OPEC to manipulate the market and maintain high oil prices.  Peak oil does not exist.  High oil prices are the result of the OPEC conspiracy.  Campbell, Deffeyes, Goodstein, Laherrere and other experts are doing OPEC's work when they issue pessimistic predictions about oil supply and may even be in OPEC's pay according to Learsy.  These experts are trying to misuse Hubbert's curve to  predict a nonexistent (according to Learsy) rapid decline in world oil.He believes that oil is not special and should be treated just like any other commodity such as wheat or copper.  

As a retired hydrologist, I am offended by the idea that the  study of a resource and the discussion of its depletion such as that on TOD are detrimental to American society.  It's hard enough to talk to people about peak oil without these ideas out in a hard-cover publication.  After I calm down, I will probably return to B&N and read the rest of Learsy's book.  

Is anyone connected with TOD familiar with this book?  Do you know of any reviews on the web?

I often encounter conspiracy theories when discussing peak oil and they no long bother me.  The thing that upset me was the implication (several places) that many peak oil workers were in the employ of OPEC.  I'll get over it.

Thanks, Marcus for the link to the reviews.

STINKY WATER, SWEET OIL, PART II
By Dan Denning
America's oil shale reserves are enormous, totaling at
least 1.5 billion barrels of oil. That's five times the
reserves of Saudi Arabia! And yet, no one is producing
commercial quantities of oil from these vast deposits. All
that oil is still sitting right where God left it, buried
under the vast landscapes of Colorado and Wyoming.
Obviously, there are some very real obstacles to oil
production from shale. After all, if it was such a good
thing, we'd be doing it already, right? "Oil shale is the
fuel of the future, and always will be," goes a popular
saying in Western Colorado.

But what if we could safely and economically get our hands
on all that oil? Imagine how the world might change. The
U.S. would instantly have the world's largest oil reserves.
Imagine...having so much oil we'd never have to worry about
Saudi Arabia again, or Hugo Chavez, or the mullahs in
Tehran. And instead of ships lined up in L.A.'s port to
unload cheap Chinese goods, we might see oil tankers lined
up waiting to export America's tremendous oil bounty to the
rest of the world. The entire geopolitical and economic map
of the world would change...and the companies in the
vanguard of oil shale development might make hundreds of
billions of dollars as they convert America's untapped
shale reserves into a brand new energy revolution.

Presidents Gerald Ford and Jimmy Carter may have been
entertaining similar ambitions in the late 1970s when they
encouraged and funded the development of the West's shale
deposits. A shale-boom ensued, although not much oil
flowed. The government spent billions and so did Exxon
Mobil. New boomtowns sprung up in Rifle, Parachute,
Rangely, and Meeker here in Colorado.

And then came Black Monday. May 2, 1982. The day Exxon shut
down its $5 billion Colony Oil Shale project. The
refineries closed. The jobs left (the American oil industry
has lost nearly as many jobs in the last ten years as the
automobile and steel industries.) And the energy locked in
Colorado's vast shale deposits sat untouched and unrefined.

Extracting oil from the shale is no simple task. The
earliest attempts to extract the oil utilized an
environmentally unfriendly process known as "retorting."
Stated simply, retorting required mining the shale, hauling
it to a processing facility that crushed the rock into
small chunks, then extracted a petroleum substance called
kerogen, then upgraded the kerogen through a process of
hydrogenation (which requires lots of water) and refined it
into gasoline or jet fuel.

But the difficulties of retorting do not end there, as my
colleague, Byron King explains:

"After you retort the rock to derive the kerogen (not oil),
the heating process has desiccated the shale (OK, that
means that it is dried out).  Sad to say, the volume of
desiccated shale that you have to dispose of is now greater
than that of the hole from which you dug and mined it in
the first place.  Any takers for trainloads of dried,
dusty, gunky shale residue, rife with low levels of heavy
metal residue and other toxic, but now chemically-activated
crap?  (Well, it makes for enough crap that when it rains,
the toxic stuff will leach out and contaminate all of the
water supplies to which gravity can reach, which is
essentially all of 'em.  Yeah, right.  I sure want that
stuff blowin' in my wind.)  Add up all of the capital
investment to build the retorting mechanisms, cost of
energy required, cost of water, costs of transport, costs
of environmental compliance, costs of refining, and you
have some relatively costly end-product."

But a new technology has emerged that may begin to tap the
oil shale's potential. Royal Dutch Shell, in fact, has
recently completed a demonstration project (The Mahogany
Ridge project) in which it produced 1,400 barrels of oil
from shale in the ground, without mining the shale at all.
Instead, Shell utilized a process called "in situ" mining,
which heats the shale while it's still in the ground, to
the point where the oil leaches from the rock. Shell's
Terry O'Connor described the breakthrough in testimony
before Congress earlier this summer (And Congress may have
an acute interest in the topic, since the U.S. government
controls 72% of all U.S. oil shale acreage):

"Some 23 years ago, Shell commenced laboratory and field
research on a promising in ground conversion and recovery
process. This technology is called the In-situ Conversion
Process, or ICP. In 1996, Shell successfully carried out
its first small field test on its privately owned Mahogany
property in Rio Blanco County, Colorado some 200 miles west
of Denver. Since then, Shell has carried out four
additional related field tests at nearby sites. The most
recent test was carried out over the past several months
and produced in excess of 1,400 barrels of light oil plus
associated gas from a very small test plot using the ICP
technology...

"Most of the petroleum products we consume today are
derived from conventional oil fields that produce oil and
gas that have been naturally matured in the subsurface by
being subjected to heat and pressure over very long periods
of time. In general terms, the In-situ Conversion Process
(ICP) accelerates this natural process of oil and gas
maturation by literally tens of millions of years. This is
accomplished by slow sub-surface heating of petroleum
source rock containing kerogen, the precursor to oil and
gas. This acceleration of natural processes is achieved by
drilling holes into the resource, inserting electric
resistance heaters into those heater holes and heating the
subsurface to around 650-700F, over a 3 to 4 year period.

"During this time, very dense oil and gas is expelled from
the kerogen and undergoes a series of changes. These
changes include the shearing of lighter components from the
dense carbon compounds, concentration of available hydrogen
into these lighter compounds, and changing of phase of
those lighter, more hydrogen rich compounds from liquid to
gas. In gaseous phase, these lighter fractions are now far
more mobile and can move in the subsurface through existing
or induced fractures to conventional producing wells from
which they are brought to the surface. The process results
in the production of about 65 to 70% of the original
"carbon" in place in the subsurface.

"The ICP process is clearly energy-intensive, as its
driving force is the injection of heat into the subsurface.
However, for each unit of energy used to generate power to
provide heat for the ICP process, when calculated on a life
cycle basis, about 3.5 units of energy are produced and
treated for sales to the consumer market. This energy
efficiency compares favorably with many conventional heavy
oil fields that for decades have used steam injection to
help coax more oil out of the reservoir. The produced
hydrocarbon mix is very different from traditional crude
oils. It is much lighter and contains almost no heavy ends.

"However, because the ICP process occurs below ground,
special care must be taken to keep the products of the
process from escaping into groundwater flows. Shell has
adapted a long recognized and established mining and
construction ice wall technology to isolate the active ICP
area and thus accomplish these objectives and to safe guard
the environment. For years, freezing of groundwater to form
a subsurface ice barrier has been used to isolate areas
being tunneled and to reduce natural water flows into
mines. Shell has successfully tested the freezing
technology and determined that the development of a freeze
wall prevents the loss of contaminants from the heated
zone."

It may seem, as O'Conner said, counter-intuitive to freeze
the water around a shale deposit, and then heat up the
contents within the deposit. It's energy-intensive. And
it's a lot of work. What's more, there's no proof yet it
can work on a commercial scale.

Yet both technologies, the freeze wall and the heating of
shale, have been proven in the field to work. The freeze
wall was used most recently in Boston's Big Dig project. It
was also used to prevent ground water from seeping into the
salt caverns at the Strategic Petroleum reserve in Weeks
Island, LA.

But still, you may be wondering, does it really make sense
to heat the ground up a thousand feet down for three or
four years and wait? Of course it does. In case you missed
O'Conner's math, Shell could harvest up to a million
barrels per acre, or a billion barrels per square mile, on
an area covering over a thousand square miles.

It's still early days in the oil shale fields of Colorado
and Wyoming, but it looks to me like someone's gonna make a
lot of money out there. I'm working hard to discover how we
outside investors can play along. Check in tomorrow for my
preliminary findings, along with a few notes from my visit
last week to Shell's Mahogany Ridge.

I would love to hear what others have to say about these developments.

  http://news.yahoo.com/s/ap/20051010/ap_on_fe_st/cheap_gas