DrumBeat: November 13, 2006

[Update by Leanan on 11/13/06 at 12:50 PM EDT]

Oilsands threatening water reserves

A study on global warming released Monday warns that the expansion of Alberta's booming oilsands industry is threatening Canadian freshwater reserves.

"The case studies that we looked at, showed that in the tar sands, for instance ... this is supposed to be a big economic boom area, they're already pressing the limits of sustainability in water use," Langer said of Alberta's Athabasca River area, which is used extensively by oil sands plants.

..."They use a huge amount, they use two to four and a half barrels of water for every barrel of oil that comes out of there and they're expecting to use more but they're literally contributing to the global warming problem and boiling off their own water," Langer said.

The report predicts there isn't enough water in the Alberta river to balance the mounting demand from the petroleum industry with the need to preserve the Athabasca's resources.

Tight oil will shake up lifestyles, expert warns

North America's dependence on oil will force higher prices and lifestyle changes in years to come, a leading Canadian energy analyst warned a Denver audience in a recent speech.

"Ultimately we will get to the point where (oil) supply is unable to meet demand in an economically feasible way. That's the break point - something has to give," said Peter Tertzakian, chief energy economist for Calgary-based ARC Financial Corp.

What will give, he said, is consumer behavior that until now has been motivated by cheap and plentiful energy. Out of necessity caused by tight supplies and high prices for oil, consumers will gravitate to fuel-efficient vehicles and increasingly embrace working at home in lieu of commuting.


Chinese now visiting peak oil sites?

Aaron of peakoil.com has posted a map, apparently showing the location of visitors to peakoil.com. One surprise in Aaron's map is the number of visitors from China.


Peak oil on the agenda: Notes from the Australian Institute of Energy annual forum

James' report below contains some minor bombshells, for instance Lloyd Taylor, former Chairman of Shell NZ, claiming that even based on the USGS data, there is a 60% of peak oil by 2015.


Jackup Change Up

Over the course of the next several years, the offshore jackup fleet will be changing significantly as 63 new jackups join the fleet by the end of 2009. That represents a 16% increase in the overall jackup fleet size. Of those 63 new jackups, only one rig is rated for less than 300' water depths (It is rated for 295' feet). As such, the higher specification, deeper water jackup fleet will be the main area of the fleet experiencing growth. It will be growing from its current size of 199 rigs to 261 rigs, which is a 31% increase in size over three years.


Attitude adjustment: Facing our ecological predicament

After a talk I gave last year on food and energy, one audience member remarked that it seemed to him that we face challenges so daunting that little can be done to stop a worldwide collapse of civilization. "What is the point in trying?" he seemed to be asking. As I prepare for guest lectures on peak oil and the consequences of overshoot at a local college this week, I'm asking myself: Is that person's attitude really all that unreasonable?


Greenpeace co-founder warms to nuclear energy

Patrick Moore, who left Greenpeace 20 years ago, said he wants to build grassroots support among mayors and state lawmakers, union members and chamber of commerce leaders.

...His message is this: "Nuclear energy is safe, reliable, cost-effective, and reduces air pollution and greenhouse gas emission."


Oil fuels national ambitions

LONDON - Iran maintains a costly nuclear program while spending billions to subsidize everything from apartments to gasoline. Russia defies international demands to give up a monopoly on oil pipelines to Europe. Venezuela sends aid to countries around the globe in an effort to expand its influence.

What all three have in common are treasuries swollen by the high price of oil.


US ethanol boom changes landscape for corn producers

NEW YORK - A boom in ethanol use in gasoline in the United States has led to a surge in corn prices and changed the landscape for farmers now producing for both food and energy markets.


Canada faces U.N. grilling over Kyoto abandonment

OTTAWA - This is likely to be another rough week for embattled Canadian Environment Minister Rona Ambrose, who must explain to a summit on global warming why Ottawa has effectively abandoned the Kyoto protocol on climate change.


Are We Ready for Change?

John Hofmeister, President of Shell Oil Company, kicked off the first half of the conference speaking about an indefinite supply of energy available in affordable ways, but not without challenges. ....Challenging part of this argument, Matthew Simmons, Chairman of Simmons & Company International, led the second half, highlighting that much of the world's usable energy resources are too mature and are now in production decline.


Corruption, insecurity threaten Sudan peace deal

Corruption, insecurity and bad faith on the part of the Khartoum government in sharing oil profits is slowing Southern Sudan's recovery from years of civil war.


Poland threatens to veto EU-Russia pact

Pipeline politics once again dominate EU-Russia relations as Poland threatens to veto the renewal of a 1997 agreement with Russia.


Ex-energy secretary sees further rise in oil prices

The long-term trend as far as oil prices are concerned is that they will rule at the present levels or may possibly go higher.

Former US energy secretary Spencer Abraham told The Peninsula yesterday that he doubted prices would fall given the current levels of demand which was also growing at a rapid pace.


Families feel the squeeze: Higher fuel, health costs hit home


Tanzania: Port congestion may push up fuel prices

RECENT congestion by seven tankers carrying over 210,000 tonnes of petroleum at the Dar es Salaam Port threatens to push up fuel prices by an average of 20/- per litre, due to accumulated demurrage charges.


China tax breaks in works for heavy oil

China, the world's biggest energy user after the United States, is drafting policies such as tax incentives and discounts to boost exploration for heavy oil resources such as oil sands and oil shale to meet demand.


Not the Revolution, But an Opening

King Coal and Big Oil continue to use their power and vast wealth to keep us locked into a reliance on earth-heating fossil fuels that, if not quickly reversed, will lead to a steady escalation of catastrophic climate events and a breakdown of an already-stressed ecosystem.


Venezuelans Square Off Over Race, Oil and a Populist Political Slogan

CARACAS, Venezuela — “Mi negra” is an almost untranslatable term of endearment used in rich and poor households in this racially mixed country, with a definition somewhere between “My dark-skinned woman” and “My dear.”

Now, it also has another meaning. In a reference to the color of oil, President Hugo Chávez’s main electoral challenger chose Mi Negra as the name of a banking card he proposes that would transfer oil revenues directly to the poor.


GOP pressed on offshore drilling limits

WASHINGTON - The Democrats' return to power is increasing pressure on House Republican leaders to accept a limited expansion of offshore oil and gas drilling.

Supporters of such exploration say the next Congress, with Democrats in control come January, probably will not tamper with the long-standing drilling bans that have protected most coastal waters for a quarter-century.


Russia rejects expansion of Chevron oil link

MOSCOW (Reuters) - Russia's Energy Ministry has rejected a plan to expand the capacity of a Chevron-led oil pipeline from Kazakhstan to the Black Sea, Kommersant business daily said on Monday.

...The consortium wants to almost double capacity from 700,000 barrels per day (bpd) to 1.3 million bpd, but has faced opposition from Russia, which fears the pipeline -- the only private crude oil link on its territory -- could increase tanker traffic at the already congested Bosphorus straits in Turkey.


Anadarko selling Gulf of Mexico oilfield

HOUSTON - Anadarko Petroleum Corp., one of the nation's largest independent energy exploration and production companies, is selling its Genghis Khan discovery in the Gulf of Mexico for $1.35 billion to owners of the adjacent Shenzi field.
The WSJ has a peak oil article called Dead Dinosaurs, but it's behind the paywall.  This is the bit that's free:

Ever since oil prices started falling from their peak levels this summer, investor interest in the idea of peak oil has declined as well.

But peak oil isn't about the economics of oil but the geology of it. "Price is a very murky window with which to figure out what's happening with oil supply," says Ken Deffeyes, a retired Princeton geology professor and leading peak-oil proponent.

Hopefully it will appear later today on a free site.  The Pittsburgh Post-Gazette might have it.

I wouldn't get my hopes up. The term 'Dead Dinosaurs' is usually used by abiotic oil loons to describe the idea that oil has a biotic origen.
The WSJ has actually been pretty good about its peak oil reporting.  
I've read it - it's just a piece on how the majors are dead money right now, and how the hot funds are all going to the small oil service companies. On the other hand, there is a column on the front page of the Money and Investing section describing peak oil. Other than getting US oil production wrong in their figure (did you know the US produced 20 billion barrels last year, down from 40 billion in the 1970's!!!), the column was fairly balanced - Deffeyes versus the new Jack play in the Gulf of Mexico.
Other than getting US oil production wrong in their figure (did you know the US produced 20 billion barrels last year, down from 40 billion in the 1970's!!!),

Yes that is hilarious. Doing quick check, the us produced last year, crude + condensate, 1.89 billion barrels of oil. In our peak year, 1970, we produced 3.52 billion barrels of crude + condensate. That was 5.178 mb/d and 9.637 mb/d respectfully.

Ron Patterson

Leanan

There is no link with the "King Coal and Big Oil ..." quote block.

Thanks!  I think it's fixed now.
"King Coal" and "Big Oil" seem to be accepted nicknames for the companies that dominate those industries, so I want to nominate a nickname for the industry that generates electricity from wind: "Mighty Wind."

Do we have any nicknames for solar and nuclear?

nicknames for solar

Ruddy Kilowatt? Sun Juice?

and nuclear?

Night Light? Mc-squared?

But you can name the top 10 oil companies operating in the US, or the world's top 10 coal companies (Peabody, Kennicott etc.).

You can even name the 'Big Solar', the world's top 10 solar cell producers (BP, Shell, a couple of Japanese firms).

It's hard to talk about a  'wind top 10'.

Do we mean turbine companies?  That's GE and Vesta and a Spanish co (whose name escapes me).

Do we mean wind operators?  Then that is the Danish utility, probably the German ones (E.On, RWE?), the Spanish one (Iberdrola).  In the US I think it is mostly independent operations (to capture the tax reliefs).

The reality is wind is just an enabling technology.

The 'Big Coal' and 'Big Oil' represent companies with locks on significant deposits of energy.  No wind company would have that lock-- wind is free and omnipresent.

The article is today's "Ahead of the Tape" column on page C1. It's very short but does discuss Hubbert and also includes a chart:

Also on page C1, in another article, Soft Energy Prices May Be Costly Later, is a quote from T. Boone Pickens:

T. Boone Pickens, the energy-investment titan whose investment fund BP Capital Management bets big on higher energy prices, is adamant that oil prices remain on an upward trajectory and probably have bottomed for now. "I think you'll see $70 oil before $50," Mr. Pickens says in an interview. "We're depleting this natural resource. It's unavoidable."

Finally, a free article from today's WSJ:

Renewable Fuels May Provide 25% of U.S. Energy by 2025

WASHINGTON -- A new Rand Corp. study showing the falling costs of ethanol, wind power and other forms of renewable energy predicts such sources could furnish as much as 25% of the U.S.'s conventional energy by 2025 at little or no additional expense.

A second renewable-energy report soon to be released by the National Academy of Sciences suggests wood chips may become a plentiful source of ethanol and electricity for industrial nations because their forested areas are expanding, led by the U.S. and China.

Thanks!  
The chart above is grossely wrong. And it gives, as its source, the EIA. I think what they meant to show, with this chart, is millions of barrels per day. That would put it about right.

Ron Patterson

Correction

The chart would be about right, in millions of barrels per day, if you took the zero off numbers to the left of the chart.

Ron Patterson

I think they forgot to add the . between the 3 and 0.  THAT puts it exactly right :)
Yes, that is correct. I had it wrong also. It would not be correct if it were millions of barrels per day, it would be correct if it were billions of barrels per year divided by 10.

Ron Patterson

The WSJ published a correction today (Tuesday, November 14, 2006), on Page A2:

Corrections & Amplifications

U.S. ANNUAL CRUDE OIL production in 2005 totaled 1.89 billion barrels. The scale of a chart of U.S. crude oil production accompanying yesterday's Ahead of the Tape column incorrectly overstated all of the output figures by a factor of 10.
Leannan- The New York Times has an interesting article on the sale of deepwater production and development prospects by Anadarko from part of their Kerr-Magee aquisition. They're selling to BHP-Billiton.
I was just reading the "Declaration of Independence" post by Hans yesterday. It is especially meaningful after having spent the weekend in exurbia outside Chicago. We spent the weekend with friends who moved from Madison, Wisc. down to Plainfield, Ill. They live in the Wesmere development, which is accessible by driving for miles and miles past strip malls, condo developments, and big box stores. The homes are large (2k - 4k sq ft) but cheap (3" soffits) and crammed in close to one another. From what I saw, it looked like the "pride in ownership" emotions expired after about three years of ownership, though there were some immaculately groomed lawns.

I watched The End of Suburbia a year ago and never understood the magnitude of these developments. Madison, Wisc has some home development going on, but not to the extent of the exurbs in Illinois. I believe low income neighborhoods will last longer than these cookie-cutter neighborhoods on the downward slope of the curve because at least low income neighborhoods have walkable streets and neighbors who know each other.

I took my dog for a walk while in the exurb and after fifteen minutes I was getting nervous about being able to relocate my friend's house. The development consists of contrived "communities" that are made up of 5-10 blocks worth of houses, with each grouping ("community") given a name like "Arbor" or "Lake Pointe" (should be called "Stormwater Runoff Holding Pond Pointe"). So little did I know I wandered out of the "Arbor" community and into the "Lake Pointe" community. All of the streets were named "Lake Pointe Circle", "Lake Pointe Drive", "Lake Pointe Court", "Lake Pointe Way", etc. And the only directional indicator I had was the humming high voltage power line running over the development toward Chicago. Luckily I encountered a person outside (the only one I saw outside of a car or a house over the course of an hour) and asked her for directions back to my friend's house on "Arbor-something". She said "Oh, you need to get back to the Arbor community which is over that way. I set my internal compass using the power line as a reference and I was on my way.

Upon leaving the development yesterday to get back to Madison I saw an intersection with 40+ signs touting the even newer developments chewing into what used to be farmland. One sign offered a waterpark in the development, but my favorite was the sign that said "Basement Included". Wow, what a deal!

Tom A-B

The front page of the McPaper has this article:

Las Vegas closing in on full house

LAS VEGAS -- Flying into this desert metropolis is as deceiving as a mirage. From 10,000 feet you see empty land in all directions and swear the pace of suburban sprawl could go on unchecked.

You'd swear no end's in sight to subdivisions stretching for miles beyond the Strip, enclaves of single-family houses that draw thousands of Californians and other migrants a year.

Look again. The valley that Las Vegas and 1.8 million residents call home is nearly built out. Mountains, national parks, military bases, an Indian community and a critter called the desert tortoise have Sin City hemmed in. At the current building pace in the USA's fastest-growing major metro area, available acreage will be gone in less than a decade, developers and real estate analysts say.

"available acreage will be gone in less than a decade"

Or water...or oil...or AC...

Cost of ownership in those houses is high.

The materials tend to need a retread every 25-30 years, roofs etc.  That's when you find out if the builders cut corners (the blogs are full of people talking about how their <insert name of major American or British housebuilder> new home turned out to be full of defects.

Insulation is often lacking, and there is a dearth of energy savings design features such as heat pumps, etc.

(here in the UK we build modern houses with smaller windows than previous generations, despite the introduction of the steel joist, insulative glass etc. which makes big windows practicable.  The result is you need artificial light even in broad daylight and you lose the solar insolation value in winter).

Of course there are the transport issues: 1 car per adult in household.  And you can't even buy a quart of milk without driving for it (walk? what me walk?).

There is an absence of trees, often, and not even a plan to grow them.  Trees are a big factor in reducing air conditioning bills.

Someone has to plough the snow, and pickup the garbage: the costs of that are proportional to lot frontage (inversely proportional to density).

Big square footage means big repair bills, and usually lots of waste space.  It's not like most of us have families with 5 kids, and our grandparents, any more.

I have a feeling we are going to come to regret this sprawl.  Just as the old fashioned post war suburb or pre WWII suburb is coming into recognition, (there are usually amenities fairly close), the exurbs are going to turn into a liability.

I just spent a week in the old narrow streeted medieval part of Barcelona which is almost completely pediastrianized for miles.  There were probably 50 cafes within a mile of my apartment. There was no parking with an only an occasional taxi or motor scooter straying into the area. The people completely owned the narrow streets and going anywhere in that area by car was unthinkable.

When I ventured out of the pediastrianized area (by mass transit, of course) , most of the cars I saw made my Prius seem bloated.  I only saw two SUVs the whole week, which, obviously, looked totally weird and out of place.

The week was an incredibly pleasnt experience in a big,crowded city. If only American cities could be half that civilized.  

Perhaps Spain has exurbia, too, but it was nice to spend a week in fantasy land, a world that in America we can only dream about.

I have seen the past and we must learn to recreate it.

This past week, I attended a meeting in our local community on Boulder county (Colorado) relocalization. The speaker pointed out that all the land currently under agriculture in Boulder County could only provide enough food for 20,000 residents. Obviously, further suburbanization or exurbanization is not going to increase that number.  

P.S. Yes, I feel a certain degree of guilt for making the airplane trip but feel that the trip was mandatory since I was attending my daughter's wedding.  Now as to why my daughter felt the need to have her wedding overseas, that is another story.

 

Regrettably, Spain does have its exurban developments: All along the coastal strips, burgeoning with new holiday villa and apartments. This will become a tragedy. All depend upon cheap air fares. Water, not plentiful in Spain at the best of times, will be an acute problem and very soon. Spain and Portugal are in drought and access to water will be an increasingly difficult problem to resolve.

It will be just as bad as Las Vegas.

One effect of these 'cookie cutter' developments that is not often noted is how they screw up traffic in a city. Almost all of these types of developments are built with 'picturesque' curvy roads and as many cul-de-sacs as possible. They don't have through streets because this is what sells. The effect is that all this traffic is routed onto a few main throughfares in the city causing havoc at every rush hour. I lived and biked (!!) in Charlotte,NC for a couple of years and it was a classic in this regard. Every main intersection had a scattering of crash debris because it accumulated faster than it could be cleaned up. Another example of abuse of the commons where the commons in this case is the infrastructure of general purpose roadways in the city.
  A lawyer I know in a Houston suburb had to quit drinking a quart of scotch a day so he could find his way home in all the cul de sacs. Poor bastard.
/ each grouping ("community") given a name like "Arbor" or "Lake Pointe"/

I've always found it ironic that surburban developments are named for the more natural use of the land that is destroyed by the deveopment.

Trees were undoubtedly destroyed to make way for the "Arbor" community.

Toxic run-off from asphalt and lawn chemicals is slowly destroying the Lake of "Lake Pointe".

"Deer Run" is a neighborhood were deers used to run.

"Hoffman Farm" was destroyed in order to build another exurban neighborhood.

Stands of Oak trees were destroyed to make way for "Oak Grove"

Etc., etc.

I wonder if any other readers of TOD discovered PO as I did- as a result of an earlier distaste for the suburbs. I grew up a "prisoner" of a typical suburban cul-de-sac outside of Columbus, Ohio.  We were so bored growing up there that my friends and I resorted to petty vandalism for entertainment.  I read Kunstler's early books, "Crabgrass Frontier" and other anti-surburban stuff years before I became aware of Peak Oil and discovered it as the anti-suburban movement became more and more aware of PO.

here in the midwest of a timberline (drive,place,court) or even subdivision is a favorite there is not a real timberline (above 10,000' ) for at least 700 miles  another one is (whatever) ridge  it's about all glacial till   no real ridges either
Yeah, my in-laws used to live on hickory hill drive- the street was completely flat and there wasn't a single hickory tree anywhere!  How can people fail the absurdity?
Global growth in carbon emissions is 'out of control'

http://news.independent.co.uk/environment/article1963236.ece


The growth in global emissions of carbon dioxide from fossil fuels over the past five years was four times greater than for the preceding 10 years, according to a study that exposes critical flaws in the attempts to avert damaging climate change.

What, me worry?

[rant warning]

How predictable. Obviously that's what we will be doing about the problem: watching and ranting how things were "out of control". If we really wanted to tackle the problem we would be having prohibitive carbon taxes and wide-scale international program for nuclear power expansion by now. Instead we are having that ridiculous Kyoto, which everyone knew was dead born and wide-scale stupidity expansion.

"Instead we are having that ridiculous Kyoto, which everyone knew was dead born and wide-scale stupidity expansion"

I agree.

Kyoto focuses on Global Flatulence at a time when the Refrigerator and Cupboards (fossile fuels) are now emptying faster than they can be replaced.  

As the Empty Belly Trend (declining available energy sources) gets worse, what will the desperate do - worry about their economic flatulence (emissions) or worry about starving and freezing?

Koyoto is busy work for politicians and green peace-religious crusaders.  It makes people feel they are doing something constructive but in reality they are distracting the world from the more pressing and immediate problem of Peak Energy.  

Germany is today discussing how to reduce German consumption of coal, oil and natural gas by an additional 20% by 2020.  Kyoto and "Kyoto II" are the noted motivations, but I could not think of a better goal (except -25% by 2018) with respect to Peak Oil Exports.

Wind turbines, our best hope as post-Peak NG bites, were helped along by Kyoto.

Kyoto may fail in it's stated goals BUT the effect has still been strongly positive for those nations that signed.  The US will suffer for not having signed.

Best Hopes,

Alan

Alan, I don't think the Kyoto protocol is a complete waste of time for the very good point you make - that one positive of Kyoto are efforts to curb emissions from fossil fuel use, which includes less use of fossil fuels (as well as less polluting forms of use).

But I wonder what a difference it would have made if the Kyoto participants were as forceful and energized, but focused on the much more immediate danger Peak Energy.  

The truth is we know far too little about our atmosphere and the various cycles regulating it to make accurate predictions and sound decisions about the future of Global Warming/Cooling.  

We know far more about our lack of Energy sources and the effects of declining energy.  What we can do about either is another question, but focusing on flatulence is not the answer IMHO.

 

The ONE positive thing the Bush Administration has done about GW is to massively research "Climate Change".  You statement about our inability to make sound decisions is no longer valid.

We are at the "preponderance of the evidence" (standard of proof for civil cases) that human carbon dioxide and other GHG emissions will cause more economic (not to mention ecological, social, humanitarian) harm than the economic costs to slow down and limit the looming disaster.

Of course, too many "conservatives" demand the standard of proof that applies to criminal cases, "Beyond a Reasonable Doubt".

I choke when I use "conservatives" in that context.

Alan

A Republican from age 19 to age 52.

For the sake of the argument I will give you Global Warming is a reality.

I still say we know too little about our atmosphere and the various cycles to act intelligently and effectively.

To act to curb emissions is fine, but I think Mother Nature (Peak Energy) is going to more effective than any efforts by the critter we call Homo Sap.  

We can't manage a deer herd or predict the weather with great accuracy beyond 24 hours.  I have no confidence our politicians and special interest groups will do a better job with the climate.

Iceland effectively & sustainably manages their cod and other fisheries as Canada has completely depleted theirs and the UK and others are well on their way.

Homo saps CAN do it, we just screw up far too often.

40% of MWh from new USA generation installed in 2006 (this year) will come from wind turbines and another 4% from other renewables. (Quote that I checked out from other TODer)

Not "perfect" but not bad either.

I have my path that is good for both PO & GW.

http://www.lightrailnow.org/features/f_lrt_2006-05a.htm

Best Hopes,

Alan