<A White ChristmasThe Oil DrumMonday's Open Thread>

Xmas Open Thread

Posted by Stuart Staniford on December 25, 2005 - 2:50am
Topic: Miscellaneous
Tags: oil price forecasts, oil prices, peak oil [list all tags]

Happy Holidays to all! Here's hoping we're all wrong about a near-term peak!

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34 comments on Xmas Open Thread

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Nate Hagens on December 25, 2005 - 4:04am Permalink | Subthread | Comments top
Happy holidays to you Stuart - I see you on the tree, 4 down from the top heart on the right.

Seriously, near term peak or no, you have consistently produced thoughtful, objective, and relevant research on this site pro-bono and it is greatly appreciated.

Much kudos to the TOD team.

Since the slippery substance we all discuss is priced at the marginal barrel, I hope this site (and others) will stay vigilant in our constructive discussions if oil drops back to $30-$40bbl, which could easily happen and would not invalidate our long term concerns one bit.

Im waiting for Santa to get stuck in my wood-stove..No sign as of yet...

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step back on December 25, 2005 - 9:53am Permalink | Subthread | Comments top
On this Holiday of infinite hopes,
When the wishes of little children become reality,
Oh to be a child again,
And not know what awaits us.

HAPPY HOLIDAYS !!! and thanks for an informative, open-threaded year.

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step back on December 25, 2005 - 10:03am Permalink | Subthread | Comments top
How one TOD Drummer got his start:
(Tara Ta Ta BONG, BONG)
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creg on December 25, 2005 - 4:45pm Permalink | Subthread | Comments top
THANKS FOR THE OIL/SCIENCE EXPERTISE  AND HARD WORK THIS SITE PROVIDES.
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CreosoteChris on December 25, 2005 - 5:10pm Permalink | Subthread | Comments top
Hi guys, new poster here, I was just reading some stuff on finance and economics, & I came across this "contrarian" view on peak oil, which you may like to comment on:
http://www.geotimes.org/dec05/feature_energy.html

Festive best wishes

Chris

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Stuart Staniford on December 25, 2005 - 6:22pm Permalink | Subthread | Parent | Comments top
He doesn't appear to understand that in the linearization method, no URR is input.
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ericy on December 26, 2005 - 1:01am Permalink | Subthread | Parent | Comments top

Beyond oil, we are on the threshold of what Jesse Ausubel and his colleagues at Rockefeller University call the "methane economy," where hydrogen-rich natural gas becomes not only the fuel of choice, but increasingly the source of hydrogen, as the "hydrogen economy" begins to emerge in a big way by mid-century. Global demand for natural gas over the next century will likely be on the order of 30,000 trillion cubic feet per year. Signs of entering the methane economy and its large demand for natural gas are here. They include the vastly enlarged need and activity in building and siting liquefied natural gas facilities to move gas on a global scale to energy-consuming markets; and in the application of advanced technology to the development of nonconventional natural gas resources.

This statement seems questionable in a number of areas.  The notion of a "methane economy" is really quite laughable.  Right now there are concerns about problems of supply keeping up with existing demand.  Maybe he is talking about coal gassification or conversion of oil sands to methane??

The fact that he brought up the "hydrogen economy" is also a clue.  Many of us here think that the talk of hydrogen is all hype...

The guy is supposed to be the dean of the geosciences department at UT-Austin.

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Engineer-Poet on December 26, 2005 - 10:48am Permalink | Subthread | Parent | Comments top
He's probably too busy with his administrative duties to keep his subject-matter expertise up to date.  Just about everything you quoted would have been reasonable (if not properly guarded) opinions... based on what was known 20 years ago.
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tom deplume on December 26, 2005 - 7:23pm Permalink | Subthread | Parent | Comments top
UT-Austin. That explains alot about why he wrote what he did.
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ericy on December 27, 2005 - 12:03am Permalink | Subthread | Parent | Comments top

OK, for those of us who aren't geologists, what is special about UT-Austin?  What kind of reputation does this school/department have?
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Descolada on December 27, 2005 - 2:09am Permalink | Subthread | Parent | Comments top
cough  In full disclosure here, I live in Austin, but that does not cloud my opinion of anything.

Pretty much anything that has the name UT - Austin attached to it is going to be top ranked in it's field.  UT is pretty much top of it's game in everything, but especially business and geology.

It makes sense though, when you think about it.  UT Austin in the main campus of the main public university of a state that for 50 years was the main source of domestic oil production.  Most of the extremely wealthy (billionaires) in Texas are energy-sector individuals, and lots of money gets pumped through that school.  Furthermore, they are in constant competition with the U of Cali schools for government contracts, etc.  see Los Alamos.  

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Luis de Sousa on December 26, 2005 - 4:11am Permalink | Subthread | Parent | Comments top
This article was written by someone who has little understanding of the issue:

. As Stuart pointed out, he doesn't understand Hubbert's method;

. He's not aware of IOR and EOR being effective only post-peak (Hirsch report);

. 'Net energy' is something he probably never heard of.

. Incredibly, he doesn't even now what the 'methane economy' is. A glimpse of it here, it's just a way of using the biogas we make at home.

Off the beat, I found this on a US gov site.

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rogerleejr on December 27, 2005 - 4:35am Permalink | Subthread | Parent | Comments top
"The Methane Economy" is what we have been calling the "dash for gas".
The link below was done in 2001, before the famous NPC report of 2003, but after the obvious failure of the projections of the NPC report of 1997.
In this link is everything that is doubtful about the "dash for gas"

http://www.oilcrisis.com/gas/primer/

This in no way implies that natural gas, or a "methane" equivilant does not have a future.  The possibility of sewer gas and waste to methane conversion are HUGE, and may be the last resort of the fuel cell dream.  Coal Bed Methane will extend the day of reckoning somewhat.  Then, the great hope...hydrogen from renewables.  If solar cell prices fall or gas/oil goes up much more, it starts becoming a competitive option, as does wind power used to split water into hydrogen.  Also, it is important to remember that Asia and Europe are in a considerably different situation than the United States.  The "dash for gas" remains viable there, due to pipeline gas being available, IF the investments are made in the pipelines.  This does however, deprive the U.S. of cheap natural gas to go on very expensive natural gas LNG tankers, making our situation even more difficult.  So the methane economy is not a dead issue.  But the idea of expanding methane production and consumption by way of cheap and easy natural gas is, if not dead, on life support.

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rtz on December 25, 2005 - 8:59pm Permalink | Subthread | Comments top
What was it like in the 1970's and '80's in Texas and Oklahoma when the wells started drying up?  Did they all start doing it nearly at once?

Have any wells in the current major oil producing countries done this?  Which was the last one to do it?  Any pattern?

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Dave Cohen on December 25, 2005 - 10:29pm Permalink | Subthread | Comments top

Vladimir Putin lights a candle for peace and lower decline
rates in Western Siberia


Iranian President Mohammad Khatami
and Venezuelan President Hugo Chavez
do not wish us a Merry Christmas


The former Pope blesses Nursultan Nazarbayev
and his plans to increase supply capacity from
Kazakhstan


Free will? God questions our wisdom down here on Earth.

Best of everything to all of you, Dave
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steverino on December 26, 2005 - 2:11am Permalink | Subthread | Comments top
usually i agree with most evey thing you say,dave, but in the case of hugo chavez, i would disagree. if you've read confessions of an economic hit man:

http://www.amazon.com/exec/obidos/ASIN/1576753018/bookstorenow57-20/002-7762584-3987218

i think you would change that opinion. the u.s. tends to treat central and south american countries as it's private reserve
, going back to the monroe doctrine. we have screwed over more hispanic countries than carter had little liver pills. so, i don't think chavez' antagonism is poorly founded. he knows he has something we want and "believe" is ours, and will do anything to get. how would you expect him to act?

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Dave Cohen on December 26, 2005 - 12:04pm Permalink | Subthread | Parent | Comments top
steverino--

I said Hugo does not wish us a Merry Christmas ;) I've read Perkins' economic hit man book and I'm familiar with the history of American misdeeds in Latin America.

best,
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steverino on December 26, 2005 - 3:40pm Permalink | Subthread | Parent | Comments top
dave....sorry for the rant..it just seemed to me that you were painting these guys as "the evil ones", and i reacted viscerally. as pogo famously said,

  "we have met the enemy, and he is us"

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Luis de Sousa on December 26, 2005 - 7:14am Permalink | Subthread | Comments top
It's monday. Christmas is gone for this year, so let's look into 2006. A good start by billionaire Richard Rainwater:

I believe in Hubbert's Peak. I came out of Texas. I watched oil fields reach peak and go over, and I've watched how people would do all they could, put whatever amount of money into the field, and they couldn't do anything about it."

You can read an interview with him here.

Richard Rainwater made billions by knowing how to profit from a crisis. Now he foresees the biggest one yet.
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Johnny on December 26, 2005 - 11:30am Permalink | Subthread | Comments top
First post.  This is the best site I have found for energy information. Still learning jargon.

Someone please explain URR, IOR, and EOR.

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Carolyn48105 on December 26, 2005 - 11:49am Permalink | Subthread | Parent | Comments top
URR = Ultimately Recoverable Reserves

EOR = Enhanced Oil Recovery  

IOR = (not 100% sure on this one) Initial Oil Recovery?

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Luis de Sousa on December 27, 2005 - 3:42am Permalink | Subthread | Parent | Comments top
IOR = Improved Oil Recovery - this is mainly related to the yearlier methods of increasing recovery, like water injection.

EOR = Enhanced Oil Recovery - the modern recovery methods like horizontal drilling and CO2 injection.

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TRE on December 26, 2005 - 12:10pm Permalink | Subthread | Comments top
And a Merry Mithras to one and all.

So one consideration:  Do we really want to wish against a near-term peak?  Why?  I'm not trying to be snide, and I realize it's just an end-of-the-year good cheer statement, but do consider:  Why put it off?  Why wish to put it off?  Let's get started.  Nothing will change until modern industrial society bumps or slams or nudges into a limit.

Though I must admit, I'd personally prefer to avoid hitting that limit.

But here's a different wish:  may energy prices gradually and inexorably increase.

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GreyZone on December 26, 2005 - 2:15pm Permalink | Subthread | Parent | Comments top
Why wish against a near term peak? Because we do not know how it will impact the world and those impacts could go very badly, according to some scenarios, unless we are prepared and right now we are not prepared.

We're in an odd situation, where even the DOE has identified the need for a 20 year lead time to roll over "safely" and without massive human suffering but at the same time data is piling up pointing to a much closer peak. We have numbers in the 2010-2015 range looking very likely but we're starting to see information that is disturbing about 2005-2010. Neither of those is going to allow for 20 years of prep time if that is where the peak actually falls.

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TRE on December 26, 2005 - 8:06pm Permalink | Subthread | Parent | Comments top
I understand your point about preparation.  But my gut tells me preparation will not take place until we reach the region of peak.  I also don't give too much credence to the DOE or Hirsch (SAIC) report or any other such good faith and not-to-be-scoffed at efforts to describe the X-years of preparation that will be required.  Essentially because it won't happen.  And the X in X years estimates is simply not a number I think they can easily predict.  Is X 10 years?  20 years?  50 years?  Perhaps X is infinity.  Who knows what it means to prepare.

The age of cheap energy has to end at some point. As a selfish individual, I want that age of endless energy to continue indefinitely, or at least during my lifetime and my kids, but something tells me we'd just as well get on with it.  Let's move into the age of more expensive energy and then figure out what really needs to be done.

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ericy on December 27, 2005 - 12:02am Permalink | Subthread | Parent | Comments top

Well we have seen SUV sales dropping in recent quarters, so some of the preparation is already beginning.

What we want or don't want really doesn't matter that much.  It will happen when it happens - some of us will be better prepared than others.

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alan on December 27, 2005 - 12:21am Permalink | Subthread | Parent | Comments top
Even GM is catching on. The latest Hummer, the H3, is smaller, it only weighs 4700 lbs.
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creg on December 27, 2005 - 7:31am Permalink | Subthread | Parent | Comments top
What we need is a shock/oil shortage that is attributable to oil itself (not a war for ex.) to raise oil depletion to worldwide agenda for planning. This would leave the maximum oil unused. I haven't come up with a good event that lays bare the peak issue; well a likely one. I wish Saudi's to come forth with an announcement of peak with a "war type briefing" with Oil Drummers' presenting the charts. How's that.
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TRE on December 27, 2005 - 1:01pm Permalink | Subthread | Parent | Comments top
creg (and lads below):

That's pretty much my idea.  Awareness of depletion combined with models to demonstrate to those willing to listen how difficult depletion will be.  That's why I'm a big fan of a couple efforts such as we see on this site: (1) Production modeling, creating models that allow us to guestimate global oil production, including depletion.  I use the guestimate seriously.  I don't think we'll ever do much better than guestimating.  Then filling in actuals as they occur.  But we need the models to help understand.

(2) Adaption modeling, in which alternate energies are considered and the capital (read energy) required to construct and organize them also guestimated.  E.g. reduction in production of new automobiles and increased production of buses.  Stuff like that.

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creg on December 28, 2005 - 2:09am Permalink | Subthread | Parent | Comments top
TRE  agree with both. It's no.2 that concerns me, as this will sink ameloration of the problems. I like ( read energy) because without both really attempts are dead in the water.  1. allows for us predicting the future + or- the error, rather large I agree.
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Agric on December 29, 2005 - 10:36pm Permalink | Subthread | Parent | Comments top
I'm inclined to agree with you, TRE. The least worst hope might be some artificially induced peak, like 10 mbpd being taken offline for a decade, well before the real peak hits. Otherwise we humans are unlikely to make the preparations we should and the road will be as painful as some of us here expect.

Nice touch on Mithras, Xtianity stole a lot from it methinks, though one could say it was a tad like Skull and Bones too ;)  I'm happy to make merry on the official holidays but the Pagan ones seem more significant to me. I tend not to wish folks 'blessed yule' etc on american boards - one can never be sure when some nut might try and burn one.

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Luis de Sousa on December 27, 2005 - 3:48am Permalink | Subthread | Parent | Comments top
Hi TRE.

I guess you have a point here. From what we know historically the later the real peak (related to the mathematical) the harder the fall.

A sooner peak will probably mean two things:

. A softer landing in the years to follow;

. A postponing of the next second derivative = 0 point.

But of course, a sooner peak don't grant you this, you might get a hard landing anyway due to real world uncertainty.

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Davidh on December 26, 2005 - 12:32pm Permalink | Subthread | Comments top
and may people, everywhere, quickly become enlightened (to my worldview, naturally) :)
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wimbi on December 27, 2005 - 10:17am Permalink | Subthread | Comments top
What I think we all should hope for in the new year is that somehow (any how)   we-that is all of everybody- realize that we have to put the true price on fuels- that is, the whole cost of everything they do, including thawing the permafrost and all the rest.  When we do that, we will see clearly that fossil fuels are far, far, too expensive to use, and we will quit using them.  There are in fact plenty of options, not now being used because we are deluding ourselves into thinking that oil is "cheap".
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