DrumBeat: November 4, 2006
Posted by threadbot on November 4, 2006 - 12:38pm
Topic: Miscellaneous
Peak Oil Passnotes: BP and Shell Show Failures of Corporate Model
If it were possible to have never ending economic growth something very difficult would have to happen. Basically we would need a never ending supply of resources and a never ending supply of capacity in which to expand.These kind of economic neo-classical laws simply do not work and two of the companies who are finding out first are the oil companies Shell and BP.
I posted this article earlier this week, but I wanted to point out the graphic that goes with it. If money talks, it's saying that "oil wars" is the way we're going to respond to peak oil.
Bangladesh: An ordinary citizen
Electricity changes lifestyle. It becomes the right of the consumers that use it. Power outage affects the ordinary consumer the most. Frequent power cuts during the last five years devastated the common man's life. It was a strange phenomenon; instead of improving, the situation deteriorated as the term of the last government was gradually coming to end.
Exxon sees plenty of oil supplies to meet demand
The world is not running out of oil and even with advances in alternative energy, fossil fuels will remain the dominant energy source well into the future, Stephen Pryor, president of Exxon Mobil Refining and Supply Co., said at a conference here Friday.
About 25% of the crude oil and 80% of the natural gas imported into the U. S. come Canada. For how long? Not very.
UK 'failed to save gas reserves'
Soaring gas prices in Britain are a symptom of the country's failure to spend its historic North Sea windfall wisely, experts have told Panorama.Long-term this could mean higher prices for consumers, loss of jobs and even a threat to national energy security, senior industry figures have said.
Some experts believe the industry failed to plan for the current steep fall-off in domestic supplies.
New Zealand: Huge riches buried deep in the south
New Zealand could be transformed into an oil rich nation on the strength of Southland and Otago's recoverable lignite deposits.A new report says the deposits could also provide most of the country's transport fuel and petrochemical requirements for more than 300 years.
IMF says high oil prices good for Latin America and Caribbean
Venezuelan Opposition Accuses Oil Company President of Illegal Campaigning
Students take algae-to-biofuel project to MIT
Sense of environmental responsibility at vehicle customization event
The most striking example of this was the world debut of the EcoJet concept car (shown above), a one-off collaboration between General Motors and noted speed nut and talk show host Jay Leno. The car, built around a Corvette Z06 aluminum frame, is powered by a 650-hp turbine engine (similar to a helicopter engine) that will rocket the 2,100-pound car off line with 585 pound-feet of torque. The “eco” part of the name comes from the fact that the car will run on biodiesel, a clean-burning fuel derived from renewable resources.
Tidal energy companies staking claims
ANCHORAGE, Alaska - In the quest for oil-free power, a handful of small companies are staking claims on the boundless energy of the rising and ebbing sea.The technology that would draw energy from ocean tides to keep light bulbs and laptops aglow is largely untested, but several newly minted companies are reserving tracts of water from Alaska's Cook Inlet to Manhattan's East River in the belief that such sites could become profitable sources of electricity.
The world's dwindling oil supply and you
The most valuable thing citizens can do to prevent the potentially catastrophic results of reaching the limits of oil production is vote in the Nov. 13 municipal election, says a former Hamilton school teacher who is spreading the word on Peak Oil.
Energy War: a documentary that aired on Dutch TV. It's in Dutch, but the interviews are in English (with Dutch subtitles).
I think this may be part of Thomas Friedman's Addicted To Oil series that aired on the Discovery Channel here in the U.S.
[editor's note, by Prof. Goose] Jeff Vail brings us this piece on problems in calculating EROEI and the EROEI of PV solar.
Note the difficulty in getting 50% Federal funding - Alan
http://www.tigardtimes.com/news/story.php?story_id=116188294740145400
All Aboard!
Local, state and federal officials break ground on Washington County's (Oregon) $117.3 million commuter rail system
Tigard Times
Oct 26, 2006
By Barbara Sherman
Jaime Valdez / The Times
SOUVENIRS - Tualatin Mayor Lou Ogden (left) and Washington County Commissioner Andy Duyck hold spikes that were removefrom Portland & Western Railroad tracks and handed out to guests at Wednesday's groundbreaking ceremony.
...
They were there to mark the special occasion, which was 10 years in the making: breaking ground for construction of the 14.7-mile, $117.3 million commuter rail system that is expected to start running in September 2008 between Beaverton and Wilsonville. [Beaverton is hub on Portland OR light rail].
The train will have two stops in Tigard and one in Tualatin.
"What an auspicious day," said Tigard Mayor Craig Dirksen, who kicked off the event.
He introduced Hansen, who said that getting the project to this point took determination and "a bit of stubbornness."
Hansen in turn introduced Brian as "the grandfather of the commuter rail project."
"We've finally arrived at the beginning," said Brian, calling the project a collaborative effort on the part of many agencies and people.
"The smartest thing we ever did was to partner with TriMet," he said. "We'll see you at the end of September 2008."
Wyden joked that in the autumn of even-numbered years, "your elected officials like to bring you good news."
He added that the commuter rail system will bring a higher quality of life to the area and link "suburb to suburb."
"It's high time for this project," Wyden added. "You can't have big-league quality of life with small-league transportation. We have taken your dreams and aspirations and (backed them up in Congress)."
Smith noted that the project has support "from local mayors to the President of the United States."
He pointed out that in the current federal transportation budget, "there are only five rail projects in the whole country, and two are in Oregon -- I-205 light rail and Washington County commuter rail. Our fathers and mothers laid these tracks in an earlier generation, and our children's generation will use it."
Wu said that the project is helping to "build the kind of community citizens want to live in," and Hooley told the crowd that there is a lot of interest from other cities in expanding the system in the future.
"I look forward to two years from now when we get to actually get on the train and ride it 15 miles," she added.
Welcome back Bushue was there to sign a full-funding agreement that provides the federal government's 50 percent match for the project, or about $58.7 million.
"This puts Oregon once more on the leading edge of transportation," Bushue said. "This is one of the few suburb-to-suburb projects around the country.
"Let's sign the contract to get (the funds) out of Washington."
Smith, Wyden and Bushue completed the ceremonial signing of the FTA agreement before Bruce Carswell, president and general manager of Portland & Western, reminded the crowd of the time when the Oregon Electric Railroad was "the epitome of modern transportation" before it stopped service in 1933.
From that point on, the railroad tracks have been used primarily to move freight -- until now, when they will once again be used to ferry people among the four cities and connect them to MAX lines and bus service.
"We're pleased to welcome passenger rail back to this section of Oregon," Carswell said.
With that, all the officials at the podium donned striped railroad caps,
unveiled a large sign marking the project and just like students graduating from high school, tossed them into the air.
Rail work ahead
From Oct. 24 to Nov. 22, a 300-foot-long machine called a P811, towing a dozen track and tie cars that are each about 60 feet long, will slowly move from along the P&W tracks from Wilsonville to Beaverton, chewing up and spitting out the old rails and replacing them with new rails and concrete ties.
The rebuilt rail line will allow the passenger trains to travel up to 60 miles per hour, and freight trails will go even faster.
When commuter rail service starts TriMet projects that by 2020 the self-propelled cars [diesel] built by Colorado Railcar will carry between 3,000 and 4,000 passengers each day during several morning and evening rush hour trips.
Off the top of my head:
Glasgow Airport Rail Link (GARL): http://www.spt.co.uk/garl/
Edinburgh Airport Rail Link (EARL): http://www.earlproject.com/
Stirling-Alloa-Kincardine (SAK): http://www.sakrailway.co.uk
Waverley route reopening: http://www.waverleyrailwayproject.co.uk/
Larkhall reopening: http://www.spt.co.uk/news/story318.html
Edinburgh trams: http://tt.tiedinburgh.co.uk/
Airdrie-Bathgate reopening: http://www.airdriebathgateraillink.co.uk/
It is true, though, that re-opening (other than the Channel Tunnel Rail Link) in England is more sporadic.
They are doing very little except the high speed link from London to the Chunnel. Long time plans in Leeds and another city (forgot) were canceled just as construction was about to start. Talk of some expansion in London, little else.
Alan
I have been using late December, 2005 as my "Index" month for both total world crude + condensate (C+C) production and for total US petroleum imports (12,867 mbpd on a four week running average).
So far this year, 67% of the weekly numbers (four week running average) are below the 12/05 index number. Last year through the same time period, only 7% of the weekly numbers were below the 12/04 index number.
My Export Land model, which was largely based on prior work by Matt Simmons, predicted that net oil exports would fall faster than overall production falls, because of rapidly rising consumption in the exporting countries and because of the basic math that an exporting country tends to export what is left over after domestic consumption is met. This positive feedback loop is compounded in many areas because of subsidies for gasoline prices.
1/06 to 5/19
7/07 to 7/28
9/29 to 10/27
(10/27 is the last data point)
I fully realize that there are refinery maintenance issues, but on the other hand (C+C) production and exports worldwide are clearly falling. Robert is arguing they are falling because of reduced demand, but overall consumption (at least in the richer countries) seems to still be rising (albeit more slowly). I argue that production and exports are permanently falling because of depletion.
To argue that we are not past the conventional C+C peak, one has to assert that the world is not going to show the same declines that the Lower 48 and the North Sea showed at the same percentage of Qt (based on the HL model), even as the "early returns" show declining world C+C production.
I guess my question is, if two vastly different regions such as the Lower 48 and the North Sea, show the same production decline, upon arrival at 50% of Qt, why would we expect to see the world to show a different pattern upon arriving at 50% of (C+C) Qt? Especially since the "early returns" show production declines.
I also liked your Ill Doomer post yesterday - may work this into The Carniverous Petrolhead.
I am not a Doomer - all Doomers are far too optimistic for my liking.
I agree. The way production has turned out over the last couple of years, it helps to paint a much more accurate picture of our total oil reserves, a point I hope westexas will acknowledge in the future. His current predictions are based on old data that ignores these last 3 years of production. To truly be accurate, you have to look at the whole picture.
Cry Wolf. I will say that I have to agree with you on your peak time, but with a little modification. Due to some of the giant fields not coming online these last 2 years, and the fact they are being pushed back another year or so, I think the peak is going to be somewhere around 2014 in regards to C+C, or just 2 years after what your saying. At this point, thats hardly a reason to debate over.
However, what should be debated over is when we start including unconventionals into the bigger picture. I think we need to discuss peak oil in terms of TOTAL liquids produced, and not based on classical conventional approaches. After all, its only a matter of time before the unconventional oil becomes a very conventional source.
Oh, and I'm glad you liked my Ill Doomer post :P
Hopefully the asylum where you live, will cut your internet access.
http://www.theoildrum.com/story/2006/11/3/8208/28582#287
I said I was to consult Khebab on application of the parabolic fractal law to KSA production. So his swift response was - already done, see here:
http://www.theoildrum.com/story/2006/6/13/214337/916
I feel as though I've been arguing till I'm blue in the face here:
http://www.theoildrum.com/story/2006/11/2/165220/570#36
to be cautious about writing KSA off too early. KSA and UK production histories may have much in common, in terms of non-linear, political-economic control over production histories.
I there anyone out there who doesn't agree that the HL for the UK and modelled HL for KSA have a lot in common?
Matt - assume a silly name and come and talk to us!
Matt Simmons
"It was all lack of data that people are more worried about." Matt Simmons
"We basically live in a world of uncertainty." Matt Simmons
"The lack of transparency keeps us all in a fog." Matt Simmons
"Relying on media reports and outdated reports is a very dangerous thing to do." Matt Simmons
(all quotes from Matt Simmons speech at ASPO-USA conference, Boston MA, October 26 2006)
In other words, what good does it do to look at the data three times if the data is garbage and not to be trusted? As the computer folks like to say,
GIGO, Garbage In, Garbage Out. Everyone is now realizing that there simply ARE NO RELIABLE NUMBERS TO BUILD A CASE ON. It's all guesswork.
Roger Conner known to you as ThatsItImout
I don't necessarily agree with this - the UK DTI and Norway NPD publish superb data bases - but then go on to distort the presentation of the data. And I think Khebab did a great job of applying methodology to imperfect KSA data - sure there are uncertainties and limitations and folks just need to be aware of that.
I don't like data being ignored, cherry picked and missrepresented.
Cry Wolf,
To quote you,
"I don't like data being ignored, cherry picked and missrepresented."
True. And likewise with words. This is one area that I often find myself in sympathy for Matthew Simmons (as much as it is possible to have "sympathy" for a billionaire investment banker! :-), and even, heaven forbid, Daniel Yergin, in that if they make a 30 minute speech, all parties will pick out the three or four most useful sentences to their cause, and run with it as an endorsement of their whole position. We all know that in human communication, there are four parts:
"What I said, what I intended for you to hear, what you thought I said, and what you wanted to hear."
Roger Conner known to you as ThatsItImout
CW,
I think that you will agree that the prior swing producer, Texas, is a better model for the current (or more accurately IMO, last) swing producer, KSA. In the link above, Khebab did HL plots of Texas, Lower 48, KSA and the world.
I think that you will agree that the more discrete the producing region or sub-basin, the noisier the data set gets. For example, the Texas HL plot is clearly noisier than the Lower 48 plot. Along the same theme, the UK HL (sub-basin) plot is clearly noisier than is the total North Sea HL plot: http://static.flickr.com/67/158784886_5c7a813465_o.png
My reasoning for showing Texas separately from the Lower 48 plot was that Texas controlled the world price of oil from about 1935 to 1970, when it was replaced by KSA.
Note that Texas peaked later than the Lower 48, relative to Qt (I assume because of its status as a swing producer). However, Texas has had a steeper post-peak decline rate than has the Lower 48 overall. So, it appears that when a region peaks later than 50%, the post-peak decline rate is steeper than those regions which peak at 50%. I think that we are seeing a similar situation in the North Sea, regarding the UK versus total North Sea.
The UK is clearly a noisy data set for several reasons I suppose. Among others is the Piper Alpha accident. In any case, in the absence of compelling reason, I am puzzled as to why one should use a sub-basin area like the UK, instead of the entire region, the North Sea.
The Oil & Gas Journal published a fairly bizarre article earlier this year that purported to show that the Hubbert method did not work by applying the method to certain basins within the Lower 48. Note that the author was attempting to show that Hubbert was wrong by focusing on discrete areas, while the overall Lower 48 continued to decline--as predicted by Hubbert (and the HL model).
We need to keep in mind that the primary purpose of the HL method is to estimate the area under the curve, or Qt. For a number of reasons, the peak may not be right at 50% in some areas (swing producers, accidents, political problems, etc.), but the method appears to be pretty accurate regarding cumulative production, which seems to be demonstrated by the ongoing rapid decline in North Sea oil production.
Khebab has demonstrated the accuracy of the HL method by accurately predicting the post-1970 Lower 48 cumulative production and the post-1984 Russian cumulative production (using only Lower 48 production data through 1970 and Russian data through 1984).
A key question is: what is the best model for the world and KSA? I respectfully submit that the best models are the Lower 48 and Texas. As predicted by the HL method and by these historical analogues, we are seeing C+C production declines worldwide and in KSA.
Finally, I continue to be somewhat puzzled by the number of oil and gas people who are expecting rising oil production when we know that three of the four super giants are declining or crashing. The only question is Ghawar, where we have various reports that production is down and that the water cut may be up to 50%. In any case, as a percentage of OOIP, Ghawar is now at about where Yibal started crashing--just as Shell was gearing up the surface production facilities to handle an expected flood of new oil.
The absolutely best case for Ghawar is that the field is producing one barrel of water for every two barrels of oil--in a field that has already been redeveloped with horizontal wells. IMO, all four of the current super giant one mbpd and larger fields are all declining or crashing.
How can the water cut not be over 50% when water injection was 4 million barrels per day in 1981 with oil output of 5 million, compared to probably less than that now and water injection of 9.5 million barrels per day?
I agree with you that the Ghawar water cut is probably over 50% and I think that the field is crashing.
Depending on what the Saudis were actually producing of late, their total production will be down by between 600,000 bpd and 1,000,000 bpd at the end of this year versus last year, while oil prices have been in a record high (nominal) range. However, the conventional wisdom is that the decrease in production is "voluntary." IMO, it's voluntary in the same sense that Texas has cut its production by 75% since 1972, because we couldn't find buyers for all of our oil.
I am not really puzzled when cornucopians who don't understand oil reservoirs extrapolate virtually infinite reserves, but I am puzzled when oil and gas insiders are not concerned when the top two super giant oil fields, which at least at one time accounted for 10% of world C+C production, are almost certainly both declining or crashing.
In our work, I think that Khebab used a consistent 20 on the vertical scale. You can find our work by searching authors for Jeffrey Brown on the EB.
Note that the actual post-1970 Lower 48 cumulative production was 99% of what the HL model predicted it would be, using only data through 1970 to predict post-1970 cumulative production. The Lower 48 model (to date) therefore suggests that Deffeyes' estimate of 1,000 Gb of remaining conventional worldwide C+C recoverable reserves is on the order of 99% accurate. And as previously noted, as predicted worldwide C+C production is declining.
"Repeat broken record token response"
As best that I can tell, Khebab does not show data points that do not fall within the limits of the graph.
IMO, Laherrere needs to either correct the plot to only show the data points that fall within the graph, or change the vertical scale so that he can accurately portray the earlier data. In my opinion, his HL plot is a misrepresentation of the data.
Khebab's total liquids plot can be seen in the following article: http://www.energybulletin.net/16459.html
Hothgor seems to have planted himself on TOD as a resident Cornucopian. I have no problem with that, but I do have a problem with people making (either through commission or omission, I will assume the latter) material misrepresentations of the data. (I have an ongoing discussion with Robert about US import data, but we don't disagree as to what the data points are.)
A case in point was Hothgor's erroneous proclamation that US natural gas production peaked 30 years later than oil production--as part of his thesis that natural gas (via LNG) would save us. The US natural gas assertion was simply not true. Net natural gas delivered to industrial and residential consumers in the US peaked in 1973, three years after oil production peaked. In addition, a recent EB article on LNG completely contadicts his LNG point.
In any case, I really do have a day job, and while I have been catching up on TOD postings, I can't be everywhere. My request is that people closely monitor Hothgor's (and my) continued postings for accuracy.
The natural gas that is transported off producing leases, which is the only thing that counts, is shown at the bottom. Click on annual at the top. You will find the history at the lower right hand corner.
US natural gas production which was transported off producing leases peaked in 1973, three years after oil production peaked.
A good deal of the reported "gross" production is continuously recyled gas cap gas that is counted several times, especially at Prudhoe Bay. It has no meaning. As the oil leg at Prudhoe Bay, between the expanding gas cap and the rising water leg, has thinned, I'm sure that the gas production rate has increased--leading to increased reported "gross" production rates. This is the same situation that we see at Ghawar and Cantarell, where the remaining oil column is between a rapidly rising water leg and an expanding gas cap.
Yet you have consistently stated that NG will peak very shortly. Why is this?
Also, how does Jack-2 factor into this. I suspect its mostly NG to begin with simply form its depth. Could we surpass our old peak simply with this find from a NG stand point?
I think that I said that a recent EB article warned of a possible near term world gas peak. The article also went on to say that expectations of LNG supplies for the US are considerably overestimated.
The ultra deep stuff has a lot of possiblities, but there are huge technical hurdles.
The nonconventional gas plays are going to be money makers for decades to come, but they are expensive and have relativly low average production rates. IMO, they will serve to slow the rate of decline of total US natural gas production, in much the same way that I expect nonconventional oil production to slow, but not reverse the decline of total oil production.
http://www.energybulletin.net/21849.html