Impressions of ASPO-USA
Posted by Dave Cohen on October 29, 2006 - 8:31pm
Topic: Miscellaneous
Tags: aspo-usa, peak oil [list all tags]
I forgot to add that M. King Hubbert Awards from ASPO-USA went to Richard Heinberg and Congressman Roscoe Bartlett (R, MD). Congratulations to them for their realistic views of our future. It's good to see everyone contributing their conference impressions here.
This is not a full conference report but rather gives some of my impressions of the ASPO-USA conference held this week at Boston University.
About 450 people attended but I thought the absence of journalists was notable. There were a few but a protest got more attention in the press than anything else. For the mainstream media, peak oil is, temporarily, off the table. This is understandable due to the negative publicity blitz we've experienced over the last few months, combined with the steep fall of the oil price. Nevertheless, the fundamental issues are still there, a point the conference brought home to its attendees. The crowd is quite diverse, although ASPO-USA tends to focus on the troublesome details in oil & natural gas production, the problems with bringing substitutes onstream and geopolitical concerns.
At this kind of conference, you can sit at your table all day and listen to all the presentations—this is like a rewarding endurance contest. But what I like to do is talk to people informally out in the hallway. So, sometimes I missed talks (sometimes unintentionally). However, I count on the presentation slides being up on the ASPO-USA website next week. Greg Geyer of Terrachord will perform this great service for all of us.
- First, I want to congratulate the conference organizers for a job well-done. I can't name them all but they're great folks. One can only imagine the hard work that goes into organizing such a thing. Everything went pretty smoothly although I will say, there are only 24 hours in a day!
- I was forcefully reminded that although peak oil is often seen as a liquid fuels problem, there is also the electrical power grid to worry about. The issues include storage of electrical power generated from wind, solar and other renewables, natural gas production declines, the great worries associated with using more pulverized coal, the problems with electricity dispatch to meet demand in a timely manner at low costs, et. al. I want to write more about this in the future.
- Dave Hughes of The Geological Survey of Canada was a new—to me— forceful voice in the peak oil debate. He spoke knowledgeably and convincingly about natural gas problems in North America and the was realistic in his assessments of what we can expect from the tar sands of Alberta. Between the natural gas problems, the enormous environmental damage, the soaring capital costs, the problems with water & dilutants for mined bitumen, there is little reason to be confident about the operation. Indeed, using natural gas for tar sands production is like "turning gold into lead" as Hughes said. From here—
Typical Oil Sands Tailings Ponds
Click to Enlarge - A message that needs to get out to people is that when you look at a typical oil field's production history—
Field Production Profiles
Click to Enlargethere arrives a point of diminishing returns based on your marginal extraction costs at the tail-end of production. At some point, it is simply no longer economic to extract any more oil because the EOR or IOR techniques being applied are more expensive than what you can get for what you produce. This is an EROEI issue concerning what are termed boundaries—what do you include when you calculate the net energy? Several speakers touched on these issues.
- NIMBY-ism is a large issue for LNG receiving terminals and wind farms. Brad Swing, director of Boston's Energy Policy division, told the attendees what happens everytime an LNG tanker moves into the Everett terminal. 72 different agencies "swing" into action. Flights are suspended at Boston's Logan Airport. It was an astonishing story. The aforementioned protest was not about Jim Gordon's Cape Wind Project (he spoke), but resistance is still strong to the project. Where do people, especially in New England, think their future electricity will come from? I've got news for them—it doesn't just come out of the wall when you flip the switch on.
- We had a sleight-of-hand magic show courtesy of a very corporate pitch from Raytheon's John Cogliandro. Here, we will not mine the oil shale nor will be heat it up using Shell's in situ method. No, in this case we will microwave it in the ground and use supercritical fluids to coax the heated liquids out of the ground. Hyperbole was high but details were scarce. Stay tuned!
- Speaking with Michael Klare in the hallway, he reiterated his belief that some military action will be taken against Iran in the coming year. I will be doing an interview with him soon — the one I scheduled fell through — and there will be an article here on it. I note that there are now no less than three aircraft carrier task forces in the area now. Uhmmm....
- The transportation section at the conference had its moments. The speakers & panelists were John Heywood of MIT, Bill Reinert of Toyota and Andy Frank of UC Davis. Frank presented an interesting vision of the future in which most everyone has an PHEV with a small engine running on biofuel. Electricity generated from renewables on the grid is stored by plugging in your car at night -- your car's battery does the trick. Disappointingly, there was no official discussion of electrified light rail and other railroad options. Reinert said something interesting about how inefficient aggressive driving is, aside from the fact that it indicates that people often act like sociopaths in their vehicles.
I shall mention other personal impressions in the comments on this thread. But the above list is certainly enough to chew on.
Finally, a little about The Oil Drum. My colleagues Stuart Staniford (British, now of San Francisco), Cry Wolf (Aberdeen, Scotland), Chris Vernon (Bristol, England) and Nate Hagens (New Hampshire) were all there. It was a great pleasure to finally meet them all (I had met Stuart previously). I can tell you that the TOD table at the bar on Friday night was definitely the place to be. I've hardly ever laughed that hard in my life. We did not find any recoverable oil but there was wine in abundance, so we partook of that instead. What smart, funny, knowledgeable people they all are. I can not drink Cry Wolf under the table but it wasn't due to lack of effort.
More seriously, The Oil Drum was considered a precious resource by most everyone at the conference. Most attendees read us on a regular basis including most of the presenters as well. That was startling and a little bit intimidating. At one point, Randy Udall had us and some people from some other websites like the Energy Bulletin stand up and get a round of applause from the conference attendees. It was a totally unexpected but much appreciated gesture. All of your good work, both from contributors and commenters, is helping to change the world. So, keep it up!
Dave Cohen
TOD Contributor
As to Stuart's view, I will give you a brief summary of my understanding of it. I believe he thinks the current plateau in oil production is the plateau, not to be followed by a new rise in global output in the next 3 or 4 years. Historically, production has got flat at one time or another but then resumed its exponential growth pattern. His analysis of the price data indicates that the trend seen since 2002 will likely continue in the future — the price will resume it's rise or stay at high levels ($65 - $70) and that the current peak of production is already priced in ±$15/barrel. I would say that his view is pretty much the same one represented in the First time here? link at the top of our homepage.
Does that help?
My main takeaways were
It's good to see recognition of the natural gas situation. Even as recently as last year we were still seeing proposals that we would switch to natgas as oil ran out. In fact wasn't it in today's drumbeat that Chino, California is requiring all garages to be built with outlets to fuel CNG cars? How much sense does that make if we're going to run out of NG before oil?
That's also an interesting and provocative point that we may never see a geologic peak. I gather that this means that we may see a peak but the timing and details will be due to the economics and politics of the situation, rather than the classic Peak Oil scenario where we're pumping as hard as we can but we just can't get the oil to come out of the ground any faster.
This creates an interesting dilemma with regards to communication efficiency: what is the optimal ratio between
- supporting energy supply transparency, and
- using supply uncertainty to support conservation & efficiency
By "optimal" I mean "making the greatest contribution to energy security".There are a couple of factors that help resolve the dilemma. First, option 1 is fundamentally futile. There is no force on this planet that can force oil and gas producers to be transparent if they choose to obfuscate. Second, both options must first make the case that there is, indeed, a lack of transparency. The best strategy thus seems to be to go for option 1 (simpler to communicate) but switch to 2 as soon as the lack of transparency is well understood.
I believe Hughes said the gas lost in LNG gasification was between 15% and 30%. A bit -- but not much according to my research -- is lost in the transport phase.
Re: #8 -- and Kaufmann's related remark that Hubbert's Curve can't differentiate between demand destruction and supply constraint cited by Khaos3
Uhmmm... Hubbert's analysis pertains to oil fields and basins, not just countries or the world. Whether extraction becomes uneconomic on the tail-end of production is a basic issue, as I mentioned. There seems to be a misunderstanding about the phrase "geologic peak". Geology creates a physical contraint on production flows at the wellhead. This constraint imposes higher marginal extraction costs. Therefore, the oil can still be extracted but perhaps not commercially. This depends on marginal extraction costs per unit of output (barrels) which includes the achievable extraction rate (the # of barrels per unit time) as compared to price.
As to Kaufmann, I have thought a bit about that. Lately, we have seen a production ceiling and demand bumped up against it. Because there was no spare productive capacity (or some for heavier oils), prices rose and demand has fallen. Especially for the poorer countries, who have been priced out of the market -- there's a story here, I just need to pick a country. Anyway, a productive capacity contraint has existed lately apart from one's view of the Hubbert function (however defined) -- and despite whatever CERA may say. A superficial look at the data curve supports Kaufmann's observation but hides the ceiling constraint. In the end, it makes little difference.
Nate, I'm short, but you're taller than everyone
Best Hopes,
Alan
Hopefully, he'll be back soon.
I would like to see a little discussion of the NIMBY phenomenon. You said "NIMBY-ism is a large issue for LNG recieving terminals and wind farms." This is, of course, true -- and I couldn't tell whether the tone of your comment was flat, or whether there was a sort of pejorative edge--
Out here in Oregon, the LNG receiving terminals proposed for coast at Coos Bay and Warrenton and up river at Bradwood would be an unmitigatable ecological disaster. NIMBY-ism is the only thing holding the hyperbole (at best) and lies (in general) of the proponents of the project in check. The Government, for sure, is not holding their feet to the fire and making them back up their claims of "Clean, Safe, Necessary" LNG and no harm to the Columbia River.
I am not ambivalent about wind farms -- I support them. About LNG recieving facilities, I am of two minds reflecting the above. Here in the US, we certainly need the natural gas, this is supported by the declining production trends data. But, I can't support putting these terminals in heavily populated areas like Boston. When you say "unmitigated ecological disaster", you must support that position with impact statements and the like. We are in the usual trade-off situation. If you like heating your home and generating electricity, then we need the natural gas. If you believe the externality costs of putting the facilities in outweighs that concern (and the alternative for gas, which is coal), then you will support the other position. If we don't have the natural gas, we will definitely burn more pulverized coal. There are huge environmental costs associated with doing that, including, of course, climate change due to CO2 emissions. The same applies to coal-to-liquids technology, which was also discussed at the conference.
Damned if you do, damned if you don't. What I believe personally is really not the issue -- although my articles here tell you a lot about the way I think about things. By and large, I see my job as bringing these problems into clear public focus. In other words, when the bullets are flying, I'm sometimes going to duck and get out of the way. But not always.
I'll give you one more example. On the bus at Logan Airport, a guy who runs a huge water processing operation told me he needs timely dispatch of electricity (he was at the conference). He asked me about nuclear. I said I was agnostic on that issue right now. He was not satisfied with my position. He needs the power not only now but in the future. What to do?
For the record, I said "unmitigatable", not "unmitigated" -- the LNG proponents will surely propose "mitigations" to their schemes.
Also, I am not "opposed" to LNG-- after all, like nuclear power, warfare, and even cancer, it exsists, so it is logically incoherent and silly to oppose a fact. I am opposed to some of the schemes to use that substance -- and the one I know best about is here in the Columbia River.
Clearly, this is not the place to provide all the documentation that supporting my position would require. My point in the initial comment was only that neither the industry nor the Government are having the dialog necessary to weigh the cost-benefit analysis you have suggested in your reply to me, and the only defense in that situation is to adopt the "sound bite" style of communication that passes for American political and social discourse -- hence NIMBY. I don't like it, I would prefer a more reasoned debate. But I am not getting it. And I am sure it is because the LNG interests would be on the losing side of a truly free debate. At least here on the North Oregon coast.
So what are the alternatives? Well, lots of them. And that is why I read the OilDrum; it is the best source of what appears to be real data either on the Internet or in paper publications.
You understand all the issues and complexity, I see. If the Columbia River location sucks, then it sucks. Put the LNG receiving somewhere else. Another point that was raised (by Hughes and others) -- this is important -- proposed LNG facilities in the US Lower 48 come & go weekly according to FERC like "shadow bands" before and after a solar eclipse. God only knows what will happen but Hughes & others were pessimistic on many counts. Even if we had the receiving terminals, would we be able to outbid Spain or Japan for the spot cargoes? Natural gas price volatility is discouraging long-term contracts. There are many issues.
best --
Given that that is the case, in principle each local person who is harmed by the new facility could receive compensation for his harm, paid for out of the benefits of the project for society, and everyone would come out ahead. This would address (most of) the objections of NIMBYs and allow projects to proceed that give benefits to all of society.
Now, obviously there are enormously difficult details to work out here. Each person's judgement of how much he is harmed may vary, and if he's going to receive payment according to the degree of harm you can bet he is not going to underestimate the damage. In practice a good system might be to give local municipalities veto power over such projects, and the companies involved could negotiate with the community and provide benefits in the form of jobs, parks and other new local construction that will improve the community and compensate for the harm of the project. I know that does happen in some cases but not always.
Seems like developers prefer to work at the state or national level and try to get them to override local control so as to avoid having to pay for all of the local costs that their projects will impose. I would suggest that this is a mistake in terms of the basic economics. NIMBYs have a point and it's not fair for them to suffer just so the rest of us can enjoy the benefits of these projects that cause so much local harm.
There is an answer to the problem of delivering LNG to heavy populated areas. Bring it ashore by underwater pipeline. Such a proposal is before the Californian Government right now by Woodside Petroleum of Australia.
They plan to ship LNG to a point 20 miles off shore from LAX international airport via underwater pipeline to join the normal gas distribution system near there. The LNG tanker can bring the LNG to a floating bouy and convert the LNG on board to normal gas. It is then piped via flexible hoses to the underwater pipeline and sent ashore.
When the gas cargo has been discharged, the bouy is dropped to 60 metres below sea level and well clear of shipping. This application known as the Oceanway Proposal, was made on the 18th of August to the various US authorities and is now awaiting approval.
There is no reason this could not be done on other US coastlines. Woodside Petroleum has delivered over 2000 LNG cargoes to Asia over the last 25 years without mishap. On the subject of WIND there seems to be a lot of misconceptions about this subject.
IT CAN NOT BE INTERGRATED SUCCESFULLY in to large power grids because of the physical nature of electricity and there is plenty of evidence of this published by electrical power engineers. I intend to offer a post on this subject shortly as well as nuclear reactors.
IT CAN NOT BE INTERGRATED SUCCESFULLY in to large power grids because of the physical nature of electricity and there is plenty of evidence of this published by electrical power engineers.'
Well, glad to hear that what the Danes and Germans have been doing (with admitted challenges) is simply illusory, according to the evidence published by electrical power engineers. And some statistics published by German power companies 'proving' how ineffective wind actually is seem at times to prove just how stubborn some people cling to their own perspective of what is in their own interests - even though the power companies pass on the increased cost of the wind power they must buy, they would prefer to own the entire system, as proven by the sham that is German energy market 'opening.'
The challenges of wind should not be denied, but they are just that, challenges. The same way that using natural gas fired turbines was quite conceivable in 1935, except for such challenges as the materials engineering for the blades, the delivery of natural gas through a pipeline to the power plant, and so on.
And at least the Germans (and French) already have a partial solution in place for some of those challenges. There are various 'storage' reserviors which are pumped with excess (nuclear generated) electricity off peak, and which are then available when peak power is required. Ironically, these reserviors were built to handle the proven fact that turning nuclear generation facilities on and off to match demand makes nuclear power too expensive to be effective in the way that a coal, oil, or natural gas fired plant is.
Somehow, though, that challenge was met - in part, through expensive investment in fairly massive dams.
Wind will never be a 'replacement' in the sense of becoming another style of power plant. It will be a replacement in the sense of providing electricity. The same applies to solar. We are unlikely to have that many choices, especially in a short time frame.
I exploited a`June 2006 conference dealing with solid waste and energy in Gallivare Sweden, well above the Arctic circle, to sightsee in the Swedish Arctic
Intercontinental Landfill Research Symposium
June 14th to 16th, 2006
North of the Artic circle in Gällivare, Sweden
http://lst.sb.luth.se/iclrs/web/symposia.html
I drove extensively (with my Peruvian family member for company) in the Swedish Arctic and marveled at the abundance of lakes and hydro dams.
(Roads, balmy warm weather, reindeer (bambis and bullwinkles ambling down the center of the Swedish roads, blocking traffic ad lib and evident grid transmission capacity were all first rate.
As was artwork on some dams, fully painted as if by Navaho Picassos) )
But that's digression. At any rate:
The Scandinavians and Europeans built with foresight. They linked abundant high latitude, remote hydro storage capacity via a high transmission capacity grid to the demand (in southern Sweden, Denmark, Germany, etc) That lets the Scandinavians integrate very high fractions of windpower in their electric resources. It also helps that Scandinavian per capita energy use is lower and poplation is lower tens of millions vs hundreds.
Unfortunately the US is both grid transmission constrained and hydro storage constrained and thus cannot effectively use wind electricity to anything like the fraction the Scandinavians enjoy.
Don Augenstein
As a morbid joke, it would likely be simple to already use the leftovers from mountaintops in West Virginia to create incredibly large amounts of storage in such a scenario. The thing is, such investment would require not only another way of looking at the future, it would require a number of people with the necessary skills to construct and maintain such fairly large scale projects - a few million unemployed real estate agents and mortgage brokers are not likely to have the necessary skills.
Now this has much to do with cold winters, electrical heating and especially electricity intensive industry.
Still Sweden (together with Norway, Switzerland and France) have the lowest CO2 emissions per capita of any industrialised country, at 6 tons per capita and year. Germans emit 9 tons and so do Danes, in spite of 20 % wind power and a vastly lower per capita power consumption (Americans emit 19 tons).
How can this be? Hydro dams and lots of nuclear reactors. That is building with foresight.
If you get a chance, maybe you can ask Klare (or some other geopolitical expert at the conference) what he thinks about the March/April 2006 article in FOREIGN AFFAIRS (by Keir Lieber and Daryl Press) arguing that the US now has nuclear primacy vis a vis Russia and China, and can thus obliterate both their nuclear capabilities without significant risk of a retaliatory strike. I have polemicized on behalf of the veracity of what this article claims on TOD in the past, but I very much recognize the limitations of my perspective on the question - especially since the Russians have apparently been substantially modernizing their military capability in recent years.
But I think this question of possible US nuclear primacy is a very important issue, since the answer to it represents one of the key components to understanding future geopolitical developments in their relation to Peak Oil.
If the U.S. can eliminate China and Russia in a single Shock and Awe event, then presumably India and the U.S. will be able to enjoy a few decades more of SUV's and swimming pools in the desert -- and the lights won't go out in Las Vegas.
You're being facetious, I hope.
#1 - How do you know what China has stockpiled? I'm sure they are not advertising what they have openly to the public.
#2 - Russia is actively developing new weapons. And there is this little news tidbit...
Russia Takes Lead in Arms Sales
http://www.themoscowtimes.com/stories/2006/10/30/201.html
BUT, whether accurate or not, the FA article is almost certainly propaganda, intimidation. If it were not blessed, it would be a treasonous leak, would it not? If there's the capability of winning such a war, you just do it when you're ready, not announce it. If you announce it, then you are trying to accomplish something on the cheap and you've told your opponents to redouble their efforts.
The problem with nuclear intimidation is the problem with all intimidation: sooner or later you end up having to either back down or enforce your credibility. So it's all but certain the nukes will leave their silos at some point. This is but one more aspect of the deeply tragic path we are on. Even if the FA article turned out to be true, it would bring about chaos that would spare no one.
Even an old atheist like myself can only say, God help us.
Russia cannot be bullied in this fashion. It didn't work when they didn't have nukes, and it certainly won't work this time around either.
The Bear is back and the Eagle is being draned dry by its consummate detritivore leader, a Yeastman above all others: GWB.