DrumBeat: May 17, 2006

Now for some wise words from the readers of The Oil Drum...
Gas pipeline blown up in Pakistan, three killed

...Baluchistan, Pakistan's largest but poorest of four provinces, is home to the country's largest gas and oil reserves.

Baluch militants resent local resources being used to benefit other regions and regularly blow up gas pipelines, rail links and power pylons, and launch rocket attacks on government buildings and army bases in the province.

I posted Bartlett's lastest talk on the floor of the house:

http://www.xecu.net/thorn/PO/May16-2006-PO.html

He was on CSPAN before 4pm, the last ones were always late at night. Maybe more members & staff will be watching in the day  time.

I have pretty well given up on trying to tell people about PO in real life. I now just do it online as most people still don't want to know. On those rare occassions when someone does ask about the consequences that PO might bring about, I now suggest that they rent the British detective series Foyles War. Set in WW2 it gives a fairly accurate portrayal of what life was like during a period of gas rationing and generally low per-capita energy consumption.

Despite the war, life was pretty civilized back then. People relied heavily on trains for longer trips and bicycles for shorter ones. Due to gas rationing, car trips were special occassions--unless of course you were on official business. Most importantly, people had time for other people instead of wasting their days away on solitary electronic distractions.

I can see us reverting back to the lifestyle portrayed in this series within the next ten years, if the worst case predictions come true.

I give Foyle's War a rating of 4.5 out of 5 stars.

"Every time I see an adult on a bicycle, I no longer despair for the future of the human race."
--H. G. Wells, 1904

I recommend that people watch the movie "time of the wolf".
http://www.imdb.com/title/tt0324197/

It's scary in way that horror films cannot be, because it centers on disorientation and uncertainty.


I saw that film at a film festival, and it was one of the more difficult ones that I have seen.  A number of people walked out in the middle as I recall.  Disorienting is a good way to put it.

I have seen other works by this director (la Pianist - The Piano Teacher), which was also rather disturbing, but in a very different way.

I also watched "Grapes of Wrath" on the advice of someone here at TOD; I highly recommend it.

Also, based on today's prices I assume there was good news on gas inventory?

I think it's very easy to get the message across to people in person, as I do it all the time.

Let them bring it up, in the form of high heating or gasoline costs.  If you start, it sounds like proselytizing.

Never use the term "peak oil."  It either introduces something they don't know, which you have to explain anyway, or they have heard it and think it's one of those weird online conspiracy things.

Tell them prices are high because of supply and demand--the amont of oil being produced can't keep up with the quickly rising worldwide demand, particularly from China.  They understand S&D, so you'll have no trouble there.

Then hit them with a fixating stat: The world uses 85 million barrels of oil per day.  That's old news to everyone here, but when non-energy geeks hear it for the first time it stops most of them dead in their tracks.  

Then tell them oil production has been declining in the US48 since 1970, and mention other exporting countries that are seeing big drops.  This is where they get the wide-eyed look.  

Finally, tell them that this isn't really old news--some geologist guy named Hubbert predicted the US48peak in 1956.

If they're still breathing, tell them they can find more information on TOD, EB, etc.

Lou, That's great advice.
Maybe even use the figure 3 and a half billion gallons of oil a day rather than 85 million barrels.  Very few people would know that a barrel is 42 gallons and using gallons may more easily create the proper perspective.
Almost a thousand barrels a second is even more impressive...
Iougrinzo

    Since last fall after talking to my brother about how much oil we use world wide per day he would hear the number and yet nothing would register in his face. So after some thinking I gave him an analogy of how much oil we use on a world basis and the rate we use it per day. I use over the road tanker trucks which haul between 7 to 9,000 gallons (I use 8,000 gal) and a 5 lane wide freeway.

    So you're standing on a bridge over a 5 lane wide freeway with tanker trucks rolling by you at 60MPH. 5 trucks abreast and nose to tail in each lane as far as you can see in both directions. Roughly one set of 5 trucks going by per second. That is how much oil we use world wide every second of every minute of every hour, night and day, of each month during the year. And next year due to growth we need to add another lane for some more trucks.

84,000,000 mb/d
3,528,000,000 gal/d (42 gal / barrel)
147,000,000 gal/hr
2,450,000 gal/min
40,833 gal/sec
8,000 gal/truck
5.1 trucks per second
60 MPH = 88 feet/sec
    He looked a little sick by the end but since he is my brother I had to push him further by asking if we should talk about coal or natural gas or any commodities. Shut up I think was his reply. I am always stunned by the shear volume and velocity that 6.5 billion of us on this planet use each and every day.

With world oil produxtion at 85.1 million b/day, your trucks need to speed up a bit !  :-(
That's a great analogy. To really drive the point home, go to a bridge with a digital camera at a spot with 5 lanes of one way traffic. Get trigger happy with the camera, and PhotoShop that picture! Or, should I do it? I know a few spots with wide enough freeway to get the feedstock pictures to PhotoShop to death.
Mad Maxout
   Very cool idea I never thought about a PhotoShop pic. I can see the vision in my head but to see it in a pic/poster would be even more sobering. I can down load pics from my camera from there on I do not have the time or skill to PhotoShop it. If you do go for it if you have the time and let me know. My brothers reaction would be priceless!         JC
I try to get people used to the idea by trying to get them to see where "conventional wisdom" is flawed.

That is, when talking to most people, the opinion that "there is plenty of oil" typically comes up pretty soon. I ask them if they think there is an infinite amount.

If they truly believe that, I will never convince them of anything. But usually with a little prodding people will grudgingly admit that there must be some limit.

From here it is easy to conclude that we will start running out sometime. The response is often along the lines of "Yeah, but that is so long from now it doesn't matter."

How long is that? Even the most riduculous forecast, anyone they can mention (USGS, the Saudis, oil companies themselves), agree there is not much more that 50 years of oil left, prehaps 100 (obviously that is a crass statement, assuming an impossible amount of recoverable oil and ignoring all sorts of physical issues, but it is sufficient for our purposes here).

So is 50 years a long time?

That is in the (current expected) lifetime of many of us. Easily in that of our children. Very possibly, our grandchildren won't even be out of high school in 50 years. Your parents probably remember 50 years ago. 50 years is not long at all.

This make it more tangible. Even the using the farthest out, most pie-in-the-sky projections, we will "run out of oil" so soon you could be around see the day. After that we will have none. Nothing. No cars, no planes, nothing at all. And people we know and love, our kids, perhaps even us, will be dealing with it.

Most people will at least stop for a second here.

Then you go into why the extreme projection are likely way off (big fields peaking all around the world already). And how things like ANWR are so tiny as to not make much difference (85 million bpd vs perhaps 1).

And the ancedote about Hubbert predicting the peak of US oil is usually pretty good. I find many people don't realize that US oil production has been decreasing for almost 40 years.

"This make it more tangible. Even the using the farthest out, most pie-in-the-sky projections, we will "run out of oil" so soon you could be around see the day. After that we will have none. Nothing. No cars, no planes, nothing at all. And people we know and love, our kids, perhaps even us, will be dealing with it."

I never tell newbies that one day the oil will run out.  I do tell them that it will become so expensive we'll have to find other solutions, which I believe is accurate.

I definitely would never tell them "no cars, no planes, nothing at all."  No electric cars?  No prop planes running on ethanol, biodiesel, or CTL fuel?  I don't think that's even close to being a reasonable prediction, and it only makes the peak oilers sound like frustrated Y2K-ers who are still upset that nothing bad happened on 1/1/2000.

I think the key is to lead newbies to the facts in as non-threatening a way as possible, and then walk them back from their knee-jerk leap into extreme pessimism.  If you hit them with the "sky is falling" stuff, even after going through most of the facts, you'll lose most of 'em instantly.

Agreed, which is why I approach it as described, versus coming out and saying "The sky is falling!" That makes you the freak. I let them come to that conclusion, which goes against what they have been lead to believe. Which then gives them pause, as if to say "Hey, even under my assumptions, which I thought were sound, we are heading off a cliff sooner than I imagined. What is going on?"

Once that bridge is crossed, you can much more freely talk about what to do about it. This is where it gets lively. I have managed to get most of my coworkers Peak Oil Aware, and some have really taken to it (cutting driving, lowering thermostats, installing a rainwater system in one case, etc).

Saying "no nothing" is extreme, and not what I believe. I am sorry if I lead you to believe I was predicting that. But it accurately underlines how dependendent on oil our current situation is (in western, and western-aspiring, societies). To a large extent, there is very little we are comfortable with today that will eventually have to be rethought (electric cars or what have you).

I have had some luck with going from the idea that each deposit of oil large or small starts under high pressure and diminishes over time making the oil ever more difficult to extract.  That seems logical to most people.
Then the notion that each nation is an aggregate of all of its small fields and thus its national production follows the same pattern.
Then, logically, the earth is the aggregate of the nations that produce oil.  
So it follows pretty well for many people that the easy oil under pressure that flows the fastest, is less viscous etc.. is the first produced. What follows is slower, harder, lower quality.  
With that understood as groundwork, the details of Saudi ala Simmons, Cantarell decline, North Sea, US peak, etc help locate us in the historical moment we're in.  
That has been my method anyway...
Matt, DC
I was a kid in the UK during WW2 and I have beeen thinking how little we relied on oil in civilian life at that time, every drop was needed by the forces.
I went to school on a tram(streetcar) powered by electricity from a coal fired power station, there were diesel trucks and  some diesel buses but a lot of commerce was delivered by horse drawn vehicles, Laundry, green grocery, bread, milk, coal, post and hardware were brought to your door by horse drawn traffic. There were also steam lorries (trucks) which were coal fired. They were quiet and surprisingly fast.
It was possible to travel by steam train to just about anywhere in the UK and there was a lot of waiting in line to book tickets and then to board the train. you were exceptionally lucky if you gat a seat.
We kept warm with coal fires which had a back boiler for hot water and a side oven for baking, or we could cook on a gas stove fuelled by gas made from coal at the gasworks which every town had.
Lighting was by electricity 1 X 60 watt bulb in a living room was thought adequate. But there were a lot of houses which had gas lighting which hissed and burned with a greenish glow It was paid for with a coin in a meter so when the light started to go dim there was a hunt for small change
 lot of people cycled and had allotmants, a bit of ground rented to you at a nominal sum by the municipal athourities.
for the purpose of growing produce, also people kept ducks, or chickens or even a pig if they had room.
The air was filthy in a coal society. Thousands of domestic fires. locomatives and factory chimneys all belching out smoke caused fogs, lung disorders, and blackened buildings.
there was always a smell of sulpher in the air and the sun shone weakly through the haze.
Most things were rationed, there was very little protein or fat but diet wise people were healther than before the war or since. Obesity was not a problem.
Interesting post, city life during WW2 in the most industrialised and urbanised country in the world at the time.
Abstract of an article from the latest issue of  Minerals and Energy - Raw Materials Report ( Volume 21, Number 1 / March 2006)

The Overseas Activities of China's National Oil Companies: Rationale and Outlook

Xin Ma and Philip Andrews‐Speed

 Abstract:

The rapid expansion of the overseas activities of China's national oil companies (NOCs) has been driven by the needs of both government and NOCs, and this partnership has provoked negative reactions in some other oil importing countries. One goal the government and companies share is to acquire overseas production of oil and gas. In the late 1990s China's government worked closely with the NOCs to gain access to projects of strategic importance. Since 2002 the link between the government and the NOCs has loosened perceptively, at least in those countries which lack a strategic significance. The NOCs are behaving more like private sector companies, but still have much to learn, especially with respect to the assessment and evaluation of risk. In the absence of a domestic crisis or a series of commercial failures, it is almost certain that China's NOCs will continue their overseas expansion. Attempts to obstruct this spread may be counter‐productive. Partnership rather than confrontation will prove to be more constructive.

Does everyone have their emergency food and water set up?

Depending on the source, we're all supposed to have from 3 days (US Gov) to 3 months supply of food and water available in emergencies.

I know this sounds very doomer, but I'm not even talking about Peak Oil!

Yup, it's time for another mild panic over H5N1 avian flu, this time courtesy of Indonesia.  Another "cluster" has popped up, this one affecting a family of 8 (or more/less, depending on new source).

http://news.bbc.co.uk/2/hi/asia-pacific/4988788.stm

and the ever wonderful Flu Wiki:

http://www.fluwikie2.com/pmwiki.php?n=Forum.SuspectedBFClustersInIndonesia6

(linked to latest page of their discussion)

What's worrying to me, at least, is the very "Mayor from Jaws" attitude the Indonesian authorities seem to be having.  From the flu wiki linked above, sufferers have been allowed to walk free from hospital and tracking of invididuals has been almost non existent.

Ah well, I guess stocking up is good practice for the more depressing Peak Oil scenarios...

We're well stocked.  I've lived in tornado and hurricane areas all my life (and was a Boy Scout), so I guess I've grown up with a preparedness attitude.  Thankfully, the crazies running the planet have been extra demonstrative lately, so that helps remind me, too.
Forgot to mention:  we use our SUV to got to SAM's and buy supplies in bulk.

Valete!

i've got my california earthquake supplies (you reminded me to check, my water is good until september '07)
Energy costs spur surprising increase in consumer prices

Consumer prices jumped 0.6% in April, the most in three months, pushed higher by rising costs for a wide range of goods and services including gasoline, clothing, rent and medical care.

The big increase in the government's most closely watched inflation barometer, the consumer price index, came after a stong 0.4% advance in March, the Labor Department reported Wednesday.

...The second sizable increase in core prices could fan fears that rising energy costs may be starting to breed inflation throughout the economy.

Did you notice that the increase in rents was cited as one of the big reasons for core inflation heating up?  As others have pointed out, as the housing bubble stalls and deflates, imputed rents and real rents will rise, keeping the core inflation rate up.  That presents a conundrum for the fed, since raising rates to hold down inflation hits the housing market harder, thereby inflating rents, which in turn raise core inflation some more.  

I wonder how much this came into play last time?  There is a paper at NBER that concludes that the stagflation of the 70s could have been due to easy money in the 60s.  The argument was that the easy money allowed people to buy gas guzzling cars and move to big houses in the suburbs.  That greatly increased fuel consumption, which set us up for problems as the US went over peak.  If we did have a housing "bubble" in the 60s/early 70s, that might also help explain the difficulty the fed had in dealing with rising inflation.  We certainly had a lot of house building at that time.

I would guess we're somewhere between 1972 and 1976 at this point.  The worst of the oil price spikes was in 79-80.  If we say that we're basically at 1976, then 2010 corresponds to 1980.  Of course, ASPO expects all liquid fuels peak around 2010, right?

You may also want to look at an intersting article at Itulip

Energy and Money

Inflation is not only determined by the supply of goods available relative to the supply of money to buy them, but also

 the demand for the currency in which goods are priced relative to the supply of that currency.  It can be hard to tell which factor is primarily driving prices.
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We have plenty of oil.  But we're running out of cheap oil and there are no cheap alternatives.

everyone's attention is focused on china and india as nouveau commodity consumers. ...but there is an old kid on the block ,that is just waking up from a long slumber..japan. in yesterday's heard on the street column in the WSJ, titled "markets brace for impact of japan's growing hunger", we get:
"the world's second -largest economy appears to be firmly on the mend after years of lackluster growth. that is an important development for commodity market's even as prices gyrate...japan adds another driver of demand at a time when supplies of copper, crude oil and other goods are already tight."
..and:
"still, with china and india trying to gobble up international energy assets, Tokyo is prodding companies to become more aggressive about acquiring oil and natural gas abroad,with investments in equatorial guinea,libya and elsewhere. a government energy strategy, due to be finalized in the coming weeks, calls for japan to draw about 40% of it's imported oil from assets owned by japanese companies by 2030"

...gee,at least their country has an energy policy...

I live in Japan, just as an FYI. Watching the evening news, I often get the opinion that the Japanese government might be a ridiculous bureaucracy, but when they decide something is 'true' they go after it whole hog. I think there's a general better sense of energy awareness here - and I definitely think that as a culture they're much more likely to voluntarily conserve than Americans in particular. They already do it, to a certain extent, with the "Cool Biz" program designed to have workplaces turn their AC down in the summer. (And believe me, Japanese summers without -some- air conditioning are a humid hell beyond all ken. Ugh.) Ah, well. They're trying. They're -definitely- doing more than the US.

But the list of countries who are more modern and better off than the US is a long one, IMO, despite the general sense of Americans that "it's the best place on God's green earth". So it goes.

American politicians/leaders are not stupid. They are simply the product of a culture which says that if you do your job poorly yet end up with more money in your pocket you succeeded. In Japan, CEOs take it as a personal humiliation when they fail the shareholders and workers. In America, as long as you can avoid imprisonment the bottom line is how much can you put into your own pocket, no matter how you have to do it. This is not a criticism of the USA, just an observation. To repeat: American politicians/leaders are not stupid, they just are the product of a different value system than the Japanese.    
Indonesia: Government likely to terminate gas exports

In line with the government's plan to optimize gas utilization at home, a minister says he is considering the gradual halting of liquefied petroleum gas (LPG) exports.

Energy and Mineral Resources Minister Purnomo Yusgiantoro told reporters Tuesday that the halting of exports would likely be needed to meet a surge in demand at home as the government pressed ahead with its plan to replace the domestic use of kerosene with LPG starting in 2007 in a bid to reduce the cost of the kerosene subsidy.

Fits perfectly with Westexas/Khebab's pieces on "net export."  This seems to be an important point of leverage in the near future.  
Yup, and this snippet from RFE/RL also gives more ammo to Dave/Westexas/Khebab, although as far as I'm aware Luzkhov has no direct influence in such issues:
MOSCOW MAYOR SAYS RUSSIA SHOULD CUT FUEL EXPORTS

Yury Luzhkov said on May 16 that Russia should consider reducing oil and gas exports, Interfax reported the same day. "We could consider reducing oil and gas exports, as our own reserves are not limitless," Luzhkov said. "We sell oil and gas to the West, in so doing helping to develop foreign economies, and the money that we receive for selling these resources we again invest in foreign securities, again stimulating the foreign economy," he added. Luzhkov argued that the Stabilization Fund from oil and gas revenues has become large enough that the government could consider cutting exports. "We have financial stabilization in the country. The Stabilization Fund is worth 1.8 trillion rubles [$66.8 billion] and will reach 2.1 trillion rubles by next year. There is the impression that the government is confused about what to do with this money," Luzhkov said.

Yesterday I attended a talk by James Lovelock on his book 'The Revenge of Gaia'.  This took place at the Brighton festival in the UK.  The discussion was chaired by John Gribbin, author of 'In Search of Schrödinger's Cat'.  Around 1000 people attended (a sell out for well over a month).  The audience appeared to be a third young student/20 somethings and two thirds people aged 50 and older.  I got the impression that audience was partisan to his point of view but were still a little shocked by what he had to say - I guess that less than half had actually read his book.  Despite his diminutive stature and mild mannered delivery, he did not pull his punches.  Here are some of his opinions:

-  The necessity for a fission power ramp immediately to cover the gap to the start of the fusion roll out in 30 years, especially on our densely populated island.  He suggested that fission was safer, both in terms of production and consistency, than any other method.  Lovelock discussed something to the effect that the annual production of high level nuclear waste is a cube a few meters on a side; this, he suggested, was a much lesser evil than the effects of the annual CO2 emissions which, if frozen, would yield a mountain 1 mile high and 12 miles in circumference at it's base.  He alluded to a possible imminent statement by the government on the subject but didn't know what it would say.  Sure enough Tony Blair obliged him this morning. The professor suggested that the onerous conditions placed on nuclear power would have to be relaxed - I imagine to reduce the lead time to completion (10-15 years?)

-  He is still against wind power (in the UK context) which he sees as a dangerous distraction, His reasoning was due to the number of turbines needed, the intermittency of power production and, due to climate change, both the change in prevailing wind direction (from westerly to north and easterly) and diminishing average velocities.

-  Lovelock described recent fusion developments as more hopeful than are being reported.  He was much more confident that the '30 years to go' meme was actually accurate this time.  He came to this opinion after visits to the current experimental generation and discussions with their scientists :)

-  He has become more pessimistic on global warming since his book was published.  He explicitly stated this was due to new research at Hadley he had viewed and had recently become involved with (in an administrative sense, bringing together different disciplines; the various research groups apparently don't seem to talk to one another despite being on the same campus!).  An 8 degree warming was inevitable and soon ('within the lifetimes of most of the people in this room' - 8 degrees at temperate latitudes and 5 degrees at the tropics).   This appears to be a shortening of his expected time frame from 100 years, in his book, to about 50 now.  Lovelock was open to 'short term technological fixes', such as allowing higher sulfur content aviation fuel, to buy time as long as they are not used to defer preparation.

-  Lovelock was cynical of global political solutions being sufficiently prescient or far reaching to do any good - a view echoed by most of those asking questions.  He suggested we must act nationally to prepare for flooding, migration and energy disruption, particularly in London and the fertile farm land in East Anglia.

-  Lovelock became most animated when describing what he termed the two worst examples of mass hysteria in the later part of the 20th Century: Chernobyl and the death of Princess Diana - He described most things being said about Chernobyl as 'lies and propaganda'.  (his main stated evidence being the WHO reports detailing what he described as surprisingly small long term effects and mortality due to the accident).  I got the impression from the audience that this was the most contentious part of the discussion.

-  When asked what we should be requesting of our politicians he described what a close friend and 'one of the most influential advises to the Chinese government on global warming' was saying:  China is probably the best appraised and understanding of all governments on global warming (!!)  China is doing what it can but says it was fearful that a single step backwards on its developmental path would lead to revolt.  Lovelock suggested that if this was the best that a command economy could do, it would be difficult to imagine democratically elected politicians doing any better.

Please note that all of the above represents my recollection of yesterdays talk.  Since I did not take any notes, and my memory is like swiss cheese, please bear in mind that I could easily have misquoted and/or misinterpreted what he said.

Don't think your memory's at fault, I've read most of this in other articles and interviews of his.
Sure the vast ramp-up of fission power is politically impossible, though.
Lovelock discussed something to the effect that the annual production of high level nuclear waste is a cube a few meters on a side; this, he suggested, was a much lesser evil than the effects of the annual CO2 emissions which, if frozen, would yield a mountain 1 mile high and 12 miles in circumference at it's base.

Could someone inform us of the safe packing density of nuclear fuel?  This "few meters on a side" kind of statement must surely understate the limits of safely packing this stuff... it is "hot" both radiologically and thermally isn't it?

It's also interesting the way he tries to quantify the CO2 emissions... as this is the kind of volume (order of magnitude) the sequestration people are trying to achieve - and I suspect they would see it as an achievment!

plank, was there no mention of demand reduction or changes in behaviour -  or does his cycnicism extend to "the masses"?

Sorry, that should have read...

"safe packing density of spent nuclear fuel"

Not including that portion rained on other countries as munitions... and granted this occurs at the front of the nuclear fuel cycle.

... it is "hot" both radiologically and thermally isn't it?
Quite.  It needs to be put behind steel and concrete, and cooling water must have neutron absorbers in it.
Could someone inform us of the safe packing density of nuclear fuel?
It depends how long it's had to cool and whether it's stored in air or borated water.  I'd love to save some folks the hassle and offer to store some of it in my backyard, in dry casks.  That is, if I get to design the casks; I've got some ideas for passively cooling the cask in ways which would let me generate steam to run an engine, and if that didn't work I'd still have free heat and hot water for years on end.
And you wouldn't have to chlorinate ;-)

The neutrons (after a sufficient dose)  make materials brittle is that right?
Given that (some) spacecraft are powered by similar emmissions why is this not feasable here? Just not worth the effort? -ve EROI? And if there is sufficient heat for steam why not some other heat engine (Stirlings)? Same deal?

Neutron emissions from spent fuel are small; what you're mostly worried about are gamma emissions (alpha is stopped by a few inches of air, beta is stopped by a few sheets of paper).  Note that if you do get neutron emissions they are usually absorbed by hydrogen and you get gamma emissions as the deuteron decays to its ground state.

The amount of energy from spent fuel is a tiny fraction of the output of the same fuel in a chain reaction.  Some of the elements of the spent fuel are worth mining for space probes and the like (e.g. Pu-238 for RTGs) but the raw fuel and its required shielding is too bulky for most purposes.

I wouldn't try running a Stirling off this because the required high-side temperatures are too great.  Filling a a sealed  cask of spent fuel with dry nitrogen and putting it inside insulation to hold the heat would do for small uses.

And I do mean small.  The table I have of reactor afterheat says that the output of spent fuel after 1 year of full-power operation is down to 0.015% of full-power output after one year of cooling.  Making 5 kW of heat from year-old fuel that's been burned for 2 years would require fuel elements capable of at least 16 megawatts.

The radioactive heating dies down long before the gamma dies down to make it safe to handle. Fast fission isn't a problem because it's too diluted by U238 and thermal fission isn't a problem because it's got to much "fissium" byproducts in there and they absorb neutrons. That's why they pulled it, because it was no longer fissile.
So just store it on site for a year and then ship it in a truck to Nevada. Seriously, I worry far more about biological pollution of food and chemical pollution of water than I do about nuclear waste. Air pollution isn't so great either.
And global warming is worse. Too late, though. We'd better concentrate on stuff we can fix like pollution and just get used to the weather changing on us.
"was there no mention of demand reduction or changes in behaviour -  or does his cycnicism extend to "the masses"? "

Demand reduction was not mentioned explicitly.  He did seem to assume that fossil fuel use growth would at best only plateau, given Chinese/Indian etc development.  I forgot to mention that he was also extremely critical of bio fuel production.  His was again an environmental argument - The degree to which new land would be needed to produce the ethanol (massive at current demand) would rob the planet of yet more of its 'regulatory mechnanism', adding to the warming feedback.  He suggested 40% of the organic carbon pump had already gone and that anything like a significant increase in biofuel production would remove at large proportion of the rest.  He suggested that the current consensus on the Amazon failing at 3 degrees (all my figures are Celsius).

While Lovelock himself did not seem cynical about the population at large, I did feel that the audience was, begin composed of what I assumed were mostly 'greens'.

Thanks for the info, very interesting.

Regarding nuclear energy, I think there are too many problems with it to make it a sound option:

  • Cost: not competitive with coal and gas generation (I have to admit that this is mainly because coal and gas fired power plants doesn't pay for the C02 the produce) Also, uranium resources are finite, too, and when mining low grade ores of uranium with a concentration of less than 0,01%, the CO2 emissions are even bigger than those of coal and gas fired plants (source: Nuclear Power: The Energy Balance)
  • Security: reports say the containment building can stand a 747 impact, but what about the pipes, the generators, all the things unprotected in the vicinity of the reactor building that provide support for operation? Regarding accidents, a MIT report on nuclear energy states that, considering a huge growth in nuclear capacity (1.500 nuclear plants), and in the best of cases (I am summarizing heavily here) we still have 5% chance of a Chernobyl type accident from here to 2055.
  • Waste: probably the worst problem of nuclear energy, no single permament warehouse for radioactive waste has been sucsesfully devised.
  • Proliferation: see Iran.
  • Public oppinion: at least here in the EU, it seems that people doesn't like nuclear energy.

A final note: here in Europe MSM takes advantage of high oil prices and global warming to paint nuclear energy as the solution (here in Spain there are some energy companies that own newspapers and TV stations), when what we have as a short to medium term problem is one of liquid fuels, and nuclear produces only electricity (and our cars still use liquid fuels), also there are some voices that blame the oil crisis in the 70s for the demise of the nuclear industry... high oil prices are bad for the nuclear business!

Finding a stash place for the nuke waste is a big problem, but I can think of a possible solution. As we use oil, we cap wells all the time as they deplete especially in the Lower 48. Depleted wells connect to a known stable rock formation - the original oil formation.

Before you cap a well, you pour down it the nuke waste, then pour cement down the well to cap it. It'll stay there for millions of years, inaccessible to terrorists. The drawback is that you'll get NIMBY-ism. May I suggest that we use depleted wells in TEXAS first? Since Bush likes nuke power so much, let him put his money where his mouth is!

He is still against wind power (in the UK context) which he sees as a dangerous distraction, His reasoning was due to the number of turbines needed, the intermittency of power production and, due to climate change, both the change in prevailing wind direction (from westerly to north and easterly) and diminishing average velocities.

There are workable solutions for dealing with the intermittency issue:

Compressed Air Energy Storage

RR

Pumped water storage also comes easily to mind.
Store excess power by pumping water uphill. When needed, release it back downhill, and enjoy Bernoulli's principle at work.

Oh man, that's disheartening.

The BIG problem with fission is the finite amount of high concentration ores, and the BIG problem with fusion is that it Doesn't Really Work Yet™. I'm an Engineer by trade and it makes me very uncomfortable to let a new widget I've built leave the building without a few days of testing, needless to say, I'm not the type to bet the future on a technology that might be ready in 30 years. If we've already peaked on oil, we might not have the industrial infrastructure to build Fusion plants in 30 years.

I'm also not so thrilled about building a flock of fission plants which well could run out of cheap uranium before you can light the fusion candle. I had pinned some hopes on breeder reactors, but an hour with Google left me wondering if any fast breeders that have been built were ever commercially successful. (Anyone have a link?) Mostly I found articles about shutdowns and technical problems, and it wasn't clear that there were any breeders operating in 2006 that could even refuel themselves, an that makes me worry even more about the real world engineering complexities of making fusion commercial.

I'm probably overly-enthusiastic about wind -- I find it comforting that it's a known technology that won't take another 30 years before it comes online. I ponder the storage issue -- we have successful compressed air and pumped water storage today, but I think we'll need to stamp a pretty huge footprint on the landscape to build enough capture and storage to maintain a reasonable level of technology. I vote we do that that, but I'm only one vote.

The BIG problem with fission is the finite amount of high concentration ores

I will not waste time debunking this since the specialists have done it many times already (for those who want to listen):

http://www.americanenergyindependence.com/uranium.html

The BIG problem with fission are peoples deceptions.

your near limitless supply's of uranium are nothing but trace amounts. because of that the energy required to collect enough makes using it rather useless, might as well use the energy used to get the uranium for electricity. Just like peak oil, there will always be oil in the ground, BUT the effort and energy needed to get at it makes it worthless to worse then worthless as a energy resource.
your near limitless supply's of uranium are nothing but trace amounts. because of that the energy required to collect enough makes using it rather useless,

Well this is pretty ridiculous statement. Even with $40/pound the uranium represents just 2% of the end costs of the electricity produced. If you accept the obviously false statement that the uranium producers did not have profits, pay sallaries etc. and all their expenses were just for the energy for the uranium mining/enrichment, it would take 50 times rise of the costs for energy for an economic break even! For reference what such a rise would mean:

The ultimate supply of uranium is very large. It is estimated that for a ten times increase in price, the supply of uranium that can be economically mined is increased 300 times.

http://en.wikipedia.org/wiki/Uranium

The quote is from K.Deffeyes (yes, the same one).

Too bad the US Army Corps of Engineers disagrees:

The US Army Corps of Engineers recently concluded that we have only 33-43 years of mineable natural uranium left on the planet, at the present rate of extraction.
http://stinet.dtic.mil/cgi-bin/GetTRDoc?AD=A440265&Location=U2&doc=GetTRDoc.pdf

We also currently have just 8 years of natural gas at present rates of extraction and less than a year of food at current rate of consumption. Should I worry?
Probably, yes.
8 years of natural gas?  Not hardly.  Where in the heck did you get that conclusion from?

I'm sorry you chose not to even be bothered to read the report I posted, so I'll quote for you here regarding natural gas.

"In the long term, natural gas is like other non-renewable resources; world production will peak later this century and this resource will become scarce. There is an estimated 66 year supply at current rates of consumption while projected growth reduces this to 40 years. World peak production of natural gas is estimated to occur
sometime between 2030 and 2050 (Laherrere 2003).

Sorry I forgot to mention that I was referring to the NG situation in North America and USA in particular.

But let's get back to the claim from the report:

Assuming an annual usage of about 150 million pounds per year, this equates to about a 33 to 43 year supply at current consumption rates.

What this misses to note is that no major search for uranium deposits has been commenced since the middle of the last century - it was simply not needed to produce more of the stuff. Just this is enough to show that comparing it to oil or NG is absolutely misleading and in fact manipulative. The other "missing" thing is that with the rise of the price the amount of economicaly minable reserves rise exponnentially. It is all scientific fact and can be checked independantly.

It makes a lot of sense if you take the time to think of it - uranium is not from abiotic origin like oil & gas; it is an abundant element, spread out relatively evenly in the earths crust (occurance is comparable to copper). Mind you - it will not run any time soon - just compare the amount of copper mined per year to the amount of uranium. As a last resort just the uranium in the seas would be enough to power our civilisation for millions of years.

Okay, I'll buy the "this is what we know we have" and "we haven't really been looking for new deposits for a long time" arguement. But uranium is still being mined from the prexisting discoveries (in places like Australia, especially), making them, for all intents and purposes, the "known reserves".  
If you're putting a lot of hope on finding new sources of yet-undiscovered uranium, then that is at best an unknown, and somebody better get looking, and fairly soon.
There is no urgency at this time as supplies are more than adequate. And many mines are still staying closed because of the 90-s supply glut. There are also problems with NIMBY-sm for new developments - unlike oil uranium is abundant in some developed countries like Canada and Australia.

But if a significant ramp-up of nuclear is commenced - then the picture will change rather quickly. Unfortuantely my bet for the next decades is actually coal, not nuclear.

I was actually just about to ask about that, in fact. If the present rate of consumption is so very low, and "known" supplies are sufficent for only 3-4 decades at that fairly small rate of present consumption, then any significant ramp-up in useage (eg. a crash nuclear program) will exhaust these supplies in fairly short order, perhaps even WITH new exploration.
If Ford had the same worries in the beginning of the last century, he would most certainly not have started to produce cars fueled by gasoline - after all, at his time there were only several years of oil left in the ground :)

But who knows, probably in the very long run you may be right... I have a compromise suggestion - build nukes while we can to fix our current situation without cooking the Earth in the next decades. In the meantime we can invest in renewables and prepare for ramping them up if we see nuclear will not be able to make it in the longer run. After all planning for problems 50 years ahead or more hardly makes any sense, doesn't it?

I'm for that, as it is both sensible and pragmagtic. I've never been an nuclear opponent, but at the same time massive "pie in the sky" projects are just that. Old country farmers have a wise phrase: Don't count your chickens before they've hatched.
We'd still better get started soon.  It takes quite a while and substantial support infrastructure (raw materials, specialized skills, etc) to construct and operate a fissile pile plant.
The estimate that you cite is pretty weak, at least for the US data, if not the whole set.   At the time of the report the US did not have any operational underground or openpit mines, and only 3 heap-leach operations.  Exploration investment in the US averaged about $4 million a year for the previous 3 years, a pittance.  The EIA and Corps can only report what industry tells them, and if the industry is moribund, there is not much to report.  See:
http://tonto.eia.doe.gov/FTPROOT/nuclear/04782002.pdf

I think there is alot of potential for expansion of the uranium reserves, the opposite of what we have for oil or gas reserves, which have been thoroughly explored. I was struck by the paragraph in Deffeyes book where he describes how his well log went off the scale as the drill went through a deep deposit.  I wonder how hard it would be to use leaching in that situation.
Even if the estimate is accurate, it makes several assumptions:

  • a price of $50 per pound of U for the reserve estimate.  With the current situation, the price could easily go higher, and so increase the reserve estimate.
  • only making use of a once-through fuel cycle, where a large fraction of the easily  fissionable U-235 is thrown away.
  • no development of advanced nuclear technologies or fuel cycles.  Right now we are mostly stuck with 20 or 30 year old nuclear tech.  We could do much better with up-to-date designs.  We could create a thousand year energy solution with a serious ($10 Billion/year) commitment to fast neutron reactors.
The ultimate supply of uranium is very large. It is estimated that for a ten times increase in price, the supply of uranium that can be economically mined is increased 300 times.

Economically mined? I can see the monopoly "Chance" card now: the little millionaire guy waving a wad of dollars at the ground and out pops pellets of fully refined uranium!

Sorry, I'm a very visual guy. ^_^

I don't happen to have a 26 year old copy of Scientific American around. Did they approach this problem from the perspective of EROEI? Did they assume that the price of uranium increased by 10x, while wages, oil, natural gas, water, and mining equipment remained the same?

From this quote, can we extrapolate that if the of the price of oil went up 10x, we could economically pump 300x as much oil? (Don't laugh, I know people who think that way.)

Some people can not be convinced whatever facts you provide (has to do something with wishful thinking I guess):

Uranium is surprisingly common and is more plentiful than mercury, silver, or cadmium in the earth's crust, and is about as abundant as molybdenum or arsenic. Much of the earth's internal heat is thought to be attributable to nuclear reactions of uranium and thorium.

http://www.webelements.com/webelements/elements/text/U/geol.html


Estimated Crustal Abundance:        2.7 milligrams per kilogram
Estimated Oceanic Abundance:        3.2×10-3 milligrams per liter

http://education.jlab.org/itselemental/ele092.html

You can compare it to other metals like copper and silver from which we are mining much larger quantities.

The BIG problem with fission are peoples deceptions.

Like how fission makes economic sense in a free market?

Please explain why Nuclear Energy makes so much sense that the Price-Anderson Indemnity Act isn't needed.

http://en.wikipedia.org/wiki/Price-Anderson_Nuclear_Industries_Indemnity_Act

(If Nuclear power is so safe, why does it need specail goverment coverage - why can't it be provided by the free market?)

Question: which energy technology is left solely to the "free market"? Oil&gas? Coal? Solar? Wind?

Thanks God none of them is not regulated or aided by govt in some way - otherwise we would have ended with totally unusable planet and some technologies would not have existed at all.

Personally I'm not sure how to classify this double talk by environmentalists - it is all like asking for a perfect technology in an imperfect world. In the end some people are left with the responsibility to keep the lights on, while other guys are conveniently preaching from their higher grounds.

Question: which energy technology is left solely to the "free market"? Oil&gas? Coal? Solar? Wind?

Then why use economic arguments of 'cost per watt' and pretend that it is a valid basis to make an informed decision.    

The link you offered up did exactly that.  

In the end some people are left with the responsibility to keep the lights on

Bigger question - why should the lights always be expected to be able to be turned on at any given instant VS an attitude of 'gee, there is only so much energy aviable at this time, do I want lights at this time or not?'

About the only thing in your link which should be answered, and most pro-fission won't answer - if the amount of uranium is found to be limited, would the government dismantle bombs to provide power?

Then why use economic arguments of 'cost per watt' and pretend that it is a valid basis to make an informed decision.

I'm not sure I see how this relates to what I say: the cost per watt is a very real measure to compare energy sources. If the cost per watt is not competitive obviously if left to the market by itself the energy source will be dead. You are effectively saying why use a market indicator for something which is not 100% market driven? Where is the logic here?  Are you suggesting the state to take over energy production and to do it regardless of costs? How are you going to defend that?

Bigger question - why should the lights always be expected to be able to be turned on at any given instant VS an attitude of 'gee, there is only so much energy aviable at this time, do I want lights at this time or not?'

I agree that we have created a wastful way of life that is trashing the planet and turning us into consumptive zombies. But I also don't want to see us descending into new dark ages, where people burn the last bit of carbon on earth and kill each other over energy... having a certain opinion about the human nature limiting our options and pushing unworkable solutions drives us exactly in this direction.

I'm not sure I see how this relates to what I say: the cost per watt is a very real measure to compare energy sources.

Not when one power generation method has a cap on its liabilites.   The limitation of libalities creates an artifically low cost structure.   Ergo - the cost per watt which has costs externalized via libilaties limitation is not the same as a cost per watt when one accepts externalized costs.

The limitation of libalities creates an artifically low cost structure.

The nuclear industry is paying more on insurance than all other utilities combined, and you still consider that a "low cost structure"? How much do you want them to pay for some potential event that may never happen? Should coal miners insure against unwillingly causing a volcano erruption?

I intend to stop this argument here... obviously you have made your mind based on the fears most people have when they hear "nuclear". I admit you have the right to do so, but I can not argue fears - they tend to put a rational shape on otherwise absolutely irrational arguments and arguing with them is pointless.

The nuclear industry is paying more on insurance than all other utilities combined, and you still consider that a "low cost structure"?

Yes.   By the power of government fiat, their liability is limited.

but I can not argue fears

What fear?   I have pointed out how the industry features a loss liability.  

You are the person who is opting not to address that issue.

AFAIK there are 3 breeders, Spain and France are on ice and Russia never bread
He described most things being said about Chernobyl as 'lies and propaganda'.

My chemistry professor used to rant quite often during lectures about how journalists, being clueless about all things important, would publish exaggerated stories about Chernobyl (and other technical things they didnt understand) that they had gotten from some extremist environmentalist organisation. I was surprised, because I had always thought that Chernobyl was a real disaster.

from chernobyl.info:
"The report concludes that, all in all, the Chernobyl disaster will claim roughly 4000 lives. By mid 2005, it says, just over 50 persons will have died as a direct consequence of nuclear exposure."

A bit like 9/11, the damage wasn't mainly done by the explosions themself, but more by the fear and anger that gripped millions of people worldwide in the aftermath.

US inflation is now running rampant.

"12.68% CPI - This is Good News?
Consumer Price inflation for All Urban Consumers popped up 0.9% in April according to figures out this morning.  This pencils out to an annualized rate of  11.35% or 12.68% if you use the more honest "old weights" for your calculations.  Around here, that's what we go by because they seem to most closely track our personal spending experience in our own checkbooks."
http://www.urbansurvival.com/week.htm

It looks like Chavez might be expecting things to heat up in his neck of the woods, too.  Following on the heels of a purchase of 100,000 new AK-103's, we have this news.
"Venezuela looking to swap U.S. F-16 fighters for Russian Su-35s"
http://en.rian.ru/world/20060517/48232490.html

Brazil continues to look like the dystopian devoluting third world country that it is:
"Brazilian police kill 33 gang suspects. Deaths bring the toll since Friday to 133, including 40 officers and guards."
http://www.chron.com/disp/story.mpl/world/3868465.html

The inflation story will start to become the big news story this Summer I suspect.
Wall St. hates it already.  Dow-Jones down 140 points and falling.
Down 200 now - the PPT has its wotk cut out for it between 3:30 and 4:00PM to pull this one up.
we were just talking about this report:

http://www.bls.gov/news.release/cpi.nr0.htm

and here it is updated today!

i'd encourage people to check out Table A.  big changes in transportation and energy, but if you personally are buffered on those (high efficiency car and appliances) then you won't take the 'average hit.'

medical costs continue their cimb ... stay healthy ...

I've been reading that Urban Survival economic blog for a while now.  He just always seems to be wrong, and his "Fractal analysis" of the stock markets plus the "web bots predicting the future" stuff is just way too out there.
I've read him daily since about 2000. In his defence, he did call 9/11.
"he did call 9/11"

Huh? Please explain, in what way did he "call 9/11"?

In June-July of 2001 he predicted (I can't remember if it was based on the web bots (web chatter) or not- that a gigantic event was going to hit the USA in August 2001 and it would be tied to the Middle East. I remember reading the site at least a couple times a week and chuckling when August passed. Then Sept 11 hit. So he was off by a couple weeks. In reality, he takes lots of swings based on this web bot stuff and doesn't always hit but that one convinced me that a LARGE number of people based in the USA must have known that something was coming down the pike.  
Even downright ignoring the more "out there" stuff, analysis of published BLS stats and CPI numbers are not 'future predictions', but rather present fact.
Sometimes it pays to look through the chaff for the wheat.
Well you'll need to look harder because the BLS numbers provided are all wrong.  Along with GDP...the game goes on.
Oh, agree, they are quite massaged. I enjoy Urbansurvival.com's  (and other's) analysis of them, based on that fact.
It's interesting that originally I discovered peak oil and that was only months ago.  Now I feel like I am in search of more & more information and the more I find the farther down the rabbit hole I get.

From peak oil to Fed Reserve Scam, all the hard data being manipulated for CPI, GDP, etc. to finally finding out about Iran Contra, true belied that our leaders are culpable for 9/11, and even to a general belief in a small group of highly successful people controlling the major spokes of our societies.

Maybe I'm just going crazy...that would make it easier to deal with all the facts.

I wish it were that simple, my friend.....
Inventory data for the week was just released. Per CNN:

U.S. crude oil stockpiles fell by 100,000 barrels last week, gasoline inventories rose by 1.3 million barrels. More soon.

RR

Here is the report.

U.S. crude oil refinery inputs veraged over 15.3 million barrels per day during the week ending May 12, up 21,000 barrels per day from the previous week's average.  Refineries operated at 89.8 percent of their operable capacity last week.  Gasoline production increased last week, averaging nearly 9.2 million barrels per day, while distillate fuel production declined compared to the previous week, averaging over 3.9 million barrels per day.

U.S. crude oil imports averaged nearly 10.4 million barrels per day last week, up 376,000 barrels per day from the previous week. Over the last four weeks, crude oil imports have averaged over 10.0 million barrels per day, a decrease of 187,000 barrels per day from the comparable four weeks last year.  Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 1.45 million barrels per day, the third highest weekly average ever.  Distillate fuel imports averaged 330,000 barrels per day last week.

The average price of a gallon of self serve unleaded gasoline in the United States edged up yet again, to $2.95/gallon.

"Gas prices pick up again. After taking a break for a week, pump prices nationwide scramble 3.8 cents higher; West Coast most expensive region, EIA survey reveals."
http://money.cnn.com/2006/05/15/news/economy/eia_gas.reut/?cnn=yes

Note the SPR increased by 500k barrels- thought additions to SPR were going to be suspended?
As I noted over at TOD NYC, NY Times has a whole section today on Green Businesses
Oil Executives March On D.C.
'We Just Want Our Voices Heard'

May 17, 2006 | Issue 42*20

WASHINGTON, DC--More than 1,000 majority shareholders and executive officers from the nation's largest oil companies gathered in the National Mall and marched to Capitol Hill Monday in a mass demonstration for petrochemical corporations' rights and, according to several of those who attended, "to let our voices be heard at last."

http://www.theonion.com/content/node/48458

For those that don't know, The Onion is a satire newspaper.  Their stories are made up.
At least the Onion admits they make things up.
Yeah, but The Onion has an uncanny knack for making up stories that later come true.  Like the story they wrote after Bush was first elected:

Our Long National Nightmare Of Peace And Prosperity Is Finally Over

And Yankees Ensure 2003 Pennant By Signing Every Player In Baseball (written before they signed A-Rod).

Startlingly prophetic, I tell you.  ;-)

or the one about the 5 blade razor ... a classic
i think this was mentioned when it was live on c-span, i caught a bit of it, but it is offered now on e&etv:

Energy Policy: New York Times columnist Thomas Friedman lays out his "laws of petropolitics"

http://www.eande.tv/main/?date=051706

Just doing some number crunching...

There are many articles about Saudi Oil reserves, most say 260B barrels in reserve.  There are also articles about Saudi Oil Decline at 8% per year  (posted on platts back in April, it has since been removed?)  Just charting those figures from now until about 2022 The Saudis would  have zero reserves left.  This is based on an 8% decline rate of their largest oil fields (which was stated on platts).  This is also based on maintaining current pumping rates and adding 2% per year based on demand.  On year one at 260B barrels of oil the Saudis would reach zero on year 16.5.  Other articles also state that the Saudis have been posting the same reserve number for the past 17 years without change while 46BB of oil have been produced from this base? http://www.theglobalist.com/StoryId.aspx?StoryId=5275

If I were to take out the 46BB of oil, ground zero is 14.75 years away... the last drop so to speak.  

So what does all of this mean?

1.)  Saudis have more oil than they state?  
2.)  Saudis have less oil than they state?
3.)  Saudis can pump oil at same rate while adding 2% for growth every year and maintain that rate until the last drop in 16.5 years?

Will we ever find out how much Saudis have left in reserve?

Or will we wake up one day have hear a huge THUD?

I'm not sure about your method. If the Saudis pump about 10 million barrels per day times 365 days per year, that is 3.65 billion barrels per year. 260 divided by 3.65 is 71 years.
I think he's referring to an 8% decline rate, exponentially year after year.  Of course, I'm allergic  to calculations like this...need Professor Bartlett.
Here are my gozintas...
(joke sorry, 1 goes into...)

Year    Reserve            2% growth    BB
1    260,000,000,000    73,000,000    3,650,000,000
2    235,477,000,000    74,460,000    3,723,000,000
3    209,191,380,000    75,949,200    3,797,460,000
4    184,932,660,400    77,468,184    3,873,409,200
5    162,537,170,184    79,017,548    3,950,877,384
6    141,854,301,638    80,597,899    4,029,894,932
7    122,745,464,676    82,209,857    4,110,492,830
8    105,083,124,815    83,854,054    4,192,702,687
9    88,749,918,089    85,531,135    4,276,556,741
10    73,637,836,767    87,241,758    4,362,087,875
11    59,647,480,192    88,986,593    4,449,329,633
12    46,687,365,551    90,766,325    4,538,316,226
13    34,673,293,757    92,581,651    4,629,082,550
14    23,527,766,055    94,433,284    4,721,664,201
15    13,179,447,286    96,321,950    4,816,097,485
16    3,562,672,068    98,248,389    4,912,419,435
17    -5,383,009,521    100,213,356    5,010,667,824

so to my point, taking the 260BB of reserve, calculating an 8% decline rate per year as well as 2% growth (demand) you see where we run into a negative number on the reserve.

Matthew Simmons feels that the decline is likely 8%-10%...

Read his recent presentation:

"Matthew R. Simmons presented "Tight Oil Supplies" at the Security Analysts of San Francisco and NAPIA Meeting in San Francisco, California on May 8, 2006."

http://www.simmonsco-intl.com/files/Security%20Analysts%20of%20SFO.pdf

OK, I think I see the problem. What is the column in the middle starting with 73 million? What does that represent exactly? How do you go from 260 billion barrels of reserves in year one to 235 billion in year 2? That's 25 billion barrels. The only way reserves can logically drop(within the accounting  method changing) is through production. Saudi only produces 3.65 Billion barrels per year, currently.
What is 8% of 260BB?  20.8BB

260,000,000,000 * 8% (decline) = 20,800,000,000

260B - 20.8B = 239,200,000,000 reserve

3.65B current production, we need to add 2% growth per year

what's 2% of 3.65B?  73M

now take the 3,650,000,000 * 2%  (growth) = 73,000,000

add 3,650,000,000 + 73,000,000 for total pump demand = 3,723,000,000

So on, so forth each year performing the calcs...adjusting...

that's the numbers.

Yes but my method also takes into account an 8% decline in available oil as well as 2% increase in demand... per year
Bradshaw...

You said an 8% decline in available oil.

You're kidding right?  

I'm only repeating Platts statements...

Dubai(Platts) --11Apr2006

Saudi Aramco's mature crude oil fields are expected to decline at a gross average rate of 8%/year without additional maintenance and drilling, a Saudi Aramco spokesman said Tuesday.

And Matthew Simmons stated it may be more like 8-10% decline... (you can read that on his site)...

I was merely throwing a "what if" calculation to see where we would be at given an 8% decline per year with the 2% increase in production demand each year that Saudi would have to meet... if they have 260B reserve... see where I was trying to go with this?

Platts removed the document... you can still see the google cached doc here:
http://72.14.203.104/search?q=cache:PxfxqCVhZAkJ:www.platts.com/Oil/News/8377179.xml%3Fsub%3DOil%26p %3DOil/News%26%3Fundefined%26undefined+saudi+oil+8%25+decline&hl=en&gl=us&ct=clnk&cd =1

In the event the google cache goes bye bye... here's the entire platt's article.

Saudi Aramco boosts drilling efforts to offset declining fields  

Dubai (Platts)--11Apr2006
Saudi Aramco's mature crude oil fields are expected to decline at a gross
average rate of 8%/year without additional maintenance and drilling, a Saudi
Aramco spokesman said Tuesday.  
     But Saudi Aramco has taken a number of measures to offset a decline in
output from the country's aging oil fields, the spokesman added.
     "A variety of remedial activities are always being taken in oil fields
influencing their effective decline rates," the spokesman said. "The drilling
of additional development wells in the producing fields is Saudi Aramco's
standard practice to offset normal declines of older wells."
     This is particularly important when oil fields are progressively depleted
under a well thought out strategy of maximizing the sweep and displacement
efficiencies, leading to high ultimate oil recovery, the spokesman said.
     "This maintain potential drilling in mature fields combined with a
multitude of remedial actions and the development of new fields, with long
plateau lives, lowers the composite decline rate of producing fields to around
2%," the spokesman said.
     Underscoring these efforts, Saudi Aramco signed two contracts with J. Ray
McDermott Middle East and McDermott Arabia Company Ltd, subsidiaries of J. Ray
McDermott, to detail design, procure, fabricate, transport and install
offshore facilities for the Maintain Potential and Khursaniyah Upstream
Pipeline programs, Saudi Aramco said April 6.
     The first contract includes two drilling support structures in Zuluf
field to be installed in December 2006 and one new wellhead production
platform in the Central Safaniya oil field to support onstream start-up in May
2007, Saudi Aramco said.
     Three additional wellhead platforms will be installed in the Central
Safaniya and Zuluf fields by December 2007. New associated flowlines will
connect these platforms to existing offshore tie-in (manifold) platforms.
     To support increasing production in the Central Safaniya field, a new
tie-in platform (Safaniya TP-18) will also be engineered, procured, fabricated
and installed by December 2007, along with a 24-inch trunkline between it and
a subsea connection on the new 42-inch trunkline flowing to the onshore
Safaniya GOSP-1, installed under a separate contract.
     The second contract is associated with the subsea portion, some 22 km (14
miles) long, of the 30-inch gas pipeline from Abu Ali Island to an onshore
site at Khursaniyah to be installed by May 2007.
     This subsea portion is part of the new 66 km BKTG-1 pipeline that will
transport 220 million cubic feet/day of gas from Abu Ali Plant to Khursaniyah
Gas Plant.
--Glen Carey, glen_carey@platts.com

What exactly is this 8% decline? What does this refer to - fields, reserves, production? What does 'available oil' mean?
I'm basing the 8% decline on provable reserves, this from the platts article above as well as Matthew Simmons statements...
OK. 8% refers to theoretical daily production decline during the years immediately following a peak in individual fields. It does not refer to a yearly change in proven reserves.

Run the same spreadsheet starting it with 260 billion barrels and subtracting only the oil expected to be produced in a given year. No matter what certain reports say, overall current Saudi production is not declining at 8% per year. If you feel that this will happen in the future, then you can add it to your equation.

Oil CEO,

I said nothing of a "theoretical daily production decline"... did you read the platts article?

"Saudi Aramco's mature crude oil fields are expected to decline at a gross
average rate of 8%/year without additional maintenance and drilling, a Saudi
Aramco spokesman said Tuesday."

An aramco spokesman said the fields are expected to decline at a rate of 8%/year if they don't have additional maintenance on the fields.

With maintenance they will decline at 2%...

"following a peak?"...
Decline is decline is decline...

they've peaked according to this Aramco spokesman...

I'm not making this up... and I'm only throwing this out there to get some input from other people.

I would really like to know what other people are finding on this subject.  

Convinced yet?
Convinced yet?  Of what do you refer?
That 8% refers to daily production capacity, and not reserves.
Am I convinced that the 8% is production?  sure whatever...so now what?  8% decline in production per year... that's a very bad sign as well... what do you have to add on this?
Well, this is something that is discussed here at great length, the essence of the whole peak-oil debate.

If we are at peak then Saudi production should be dropping by between 5 and 8 percent per year starting, well, now - that is if you believe this extremely faulty interpretation of events. I don't see it happening.

The 8 percent is a number that has been tossed around recently. It appears in the article you cite, and elsewhere. Sure that's what individual fields get for a decline rate shortly post-peak. We know this much. But that is a far cry from overall Saudi crude production dropping by that much next year.

The whole issue is whether Saudi can increase its overall production by a forecast 2% rate which is needed to support expected demand, while at the same time countering 8% declines in its oldest and biggest fields.

An overall decline of 8% assumes all fields are post-peak, and there are no new fields coming on-line.

They are producing 9.5 million barrels per day now. If they are only producing 8.8 million barrels per day next year this time, I'll eat my shoe. But if you want to believe that  will be the case, be my guest.

The 9.5 million number I use is of course straight crude, Saudi also produces another 1.2 mbpd of other stuff that is considered crude-equivalent. You have to add that to the 9.5 to get their contribution to worldwide total liquids production of 85 million barrels per day. This 1.2 mbpd production seems fairly steady and is not declining at 8%.

My point exactly sir :)

I really don't know whether Saudi Oil is in decline or not, I'm merely re-stating what other's are reporting. I personally just really want to learn the truth... I've been hearing allot about this topic lately... much speculation... but no real "hard numbers" to enforce direction.  

You'r handle is "Oil CEO"... I myself am the CTO of a major company... and I also own my own consulting company and I've been so busy in business that I have had my head below the surface for some years... to be honest... I had never heard of PO up until 2 mos ago.  

I really don't watch TV much, I work from 5am til about 6pm every day, come home spend some time with my family...go to bed and do it all over again... however a few months ago I came across a PO article... and have been pursuing the truth ever since :-/

Alright Mr. Oil CEO, I look forward to your comments as I am here for the long haul and hope to add something useful to the public / bloggers....  going to head to bed as I need to get up at 4:30am to commute into the office (Houston, TX)...lovely traffic - Slat-ke snoff (sweet dreams in Russian phonetic) Yes... I speak Russian too... my wife is Russian :-/

-Have a good one.

Not according to the EIA they don't produce another 1,2 mb of "crude equivalent". What's your source for that statement?
The EIA. Table t11a - 9.5 mbpd crude+lease condensate(most recent month). Table t13 -1.225 mbpd NGPLs(most recent month).

If you check these numbers against other tables and sources that show total world production totaling 84 to 85 million barrels per day, you will see that Saudi's contribution is the total of these two numbers or 10.7-11 mbpd. Since it is counted as crude, I'd call it crude equivalent, wouldn't you? BP gives Saudi production in 2004 as 10.584 mbpd, for instance, obviously a combination of the two sources. If you would like more information, you can start with the footnotes on these sources.

What's your source?

What document?
Found it, silly me  (I was reading EIA as IEA :-( )
Saudi production has been very, very flat (and apparently consistantly constant) of late, from Stuart's own charts previously. Almost abnormally so. Yet at the same time they have been unable to boost daily production further (but sometimes say they can).  
I surpmise that, like any smart production-based enterprise, they use their storage capacity to regulate actual "output", drawing from it as needed, and adding to it when they have excess, on a day-to-day basis. Aramco has the largest petroleum storage capacity of anyone in the world, after all.
If they're actually seeing an decline in day-to-day production from their wells, thanks to the ability to draw any shortfall from storage, it may well be a very long time before these shortfalls become evident in their actual "output", the amount supplied.
In short, their massive buffer allows for a very effective "smoothing" function (as is apparent) and also for substantial lag time on any depletion being "visible" (not apparent), and they have every incentive to keep such depletion invisible for as long as humanly possible.
When more comments came in on the reference to production decline, I commented as follows:

years    production    8% decline    mb/day
1    3,600,000,000    288,000,000    9,863,014
2    3,312,000,000    264,960,000    9,073,973
3    3,047,040,000    243,763,200    8,348,055
4    2,803,276,800    224,262,144    7,680,210
5    2,579,014,656    206,321,172    7,065,794
6    2,372,693,484    189,815,479    6,500,530
7    2,182,878,005    174,630,240    5,980,488
8    2,008,247,764    160,659,821    5,502,049
9    1,847,587,943    147,807,035    5,061,885
10    1,699,780,908    135,982,473    4,656,934

So?... again... just wanting some input from others;  anyone else have somethint to add/detract?

Are we going to see a decline in available oil on the market or is this all "make believe" and we'll have plenty for 2-300 years to come?

That's an 8% per annum production decline, not a reserves decline as (I think) you have assumed.
The 8% represents a production decline, not the percent of reserves lost or depleted. This is part of the terminology problem where people confuse depletion with decline. You can have high (rapid) depletion of reserves with level or increasing production early in a field's life. Depletion is the rate at which the reserves are being drawn down. Decline simply represents reduction in rate of production from one year to the next. Actually, as decline rate increases, the depletion rate can slow.

The 8% (if accurate - an entirely different question) is the decline in production rate of a field from one year to the next, not the rate of depletion of the reserves.

Thank you for posting sir :)  The article says 8% decline...they don't say reserve or production...so take your pick, maybe it's production... if so... an 8% decline in production per year... what does that mean?

they're producing 3.65B per year now decrease by 8% per year...that doesn't sound good either...

Anyone?

I have never seen decline rate expressed as anything other than the fall in production year over year.   A reserve estimate is a concept.  A production number is (mostly) a hard number.  That is why the HL method is so powerful.  It uses the hard numbers (actual production) to predict recoverable reserves.

Since Texas peaked in 1972, our annual net decline rate (after adding new production every year) has been about 4.5% per year.

(Note that Stuart's HL plot matches the internal Kuwiti estimate of 48 Gb)

Addicted to crude
http://mondediplo.com/2006/05/06oilproduction

Excerpt:

Such doubts are reinforced by the fact that estimates of reserves published by some Opec countries have sometimes remained unchanged for long periods, as if each barrel produced was miraculously and immediately replaced thanks to a discovery or re-evaluation. For example, Iraq put its reserves at exactly 100bn barrels throughout 1987-95, before raising the figure to 115bn. Equally surprisingly, between 1991 and 2002 Kuwait's proven reserves remained at 96.5bn barrels despite cumulative production of 8.4bn barrels during that period. Using data reportedly supplied by Kuwaiti officials, the US Petroleum Intelligence Weekly asserted in January 2006 that official figures muddled proven, probable and possible reserves and that genuinely proven reserves amounted to no more than 48bn barrels.

Thanks to the opacity of the statistics and the unreliability of the methodology used to make the calculation, the level of the Russian Federation's reserves remains uncertain. But some western sources estimate that the real level of proven Russian reserves is 30%-40% lower than the official figure of 72.3bn barrels.

There are even doubts about the figures given by international companies quoted on the stock exchange and subject to checks by auditors. In January 2004, following a marked fall in production at its Yibal field in Oman and disappointing results elsewhere, Shell admitted that it had overstated its reserves by almost 33%. A few months later the US company El Paso revised its reserves down by 11%. More recently, in January 2006, the Spanish group Repsol YPF had to cut 1.25bn barrels of oil equivalent, almost 25% of the total, from its previously published estimate of its worldwide reserves of hydrocarbons. Like Shell, it was deluged by legal claims from shareholders.

westtexas, are you in west texas?  I'm in Houston, TX :)
From West Texas, I'm in Dallas now.
and if we're talking about production decline... I show you more excel number crunching...

We're in deep doody.... Saudi is suppose to increase production....(we can go to 12, 15 20 mb/day when the market calls for it...)  if they're in decline, how can they possibly do this?

years    production    8% decline    mb/day
1    3,600,000,000    288,000,000    9,863,014
2    3,312,000,000    264,960,000    9,073,973
3    3,047,040,000    243,763,200    8,348,055
4    2,803,276,800    224,262,144    7,680,210
5    2,579,014,656    206,321,172    7,065,794
6    2,372,693,484    189,815,479    6,500,530
7    2,182,878,005    174,630,240    5,980,488
8    2,008,247,764    160,659,821    5,502,049
9    1,847,587,943    147,807,035    5,061,885
10    1,699,780,908    135,982,473    4,656,934

Terminology aside, I agree with your essential point that we are in deep trouble. While aspects of the article leave unanswered questions, this is the closest I have ever seen Saudi Arabia suggesting that they are not able to maintain (much less grow) production from their mature fields. So it all comes down to how fast they decline vs how fast they can bring on new production, a challenge that Texas, US, North Sea, Mexico and many others have lost.
And I draw on another topic of water cut.  The Saudis are known for their cutting edge technology when it comes to oil production.  They have spoke design horizontal wells with massive sea water cut into the well to keep pressures high as to keep the lovely black gold flowing at the highest possible levels to meet demand.  If they're cutting near 50% water / oil now... what will the rate be to produce the 12-15 mb/day oil around 2009-10?

Will we be seeing 70, 80-90% water cut shortly after 2010?  This is very disturbing to ponder.  I truly hope that we're all wrong... that the Saudis have 4 trillion barrels of oil just floating around waiting to be tapped and we can go on chowing down at the oil buffet in our Hummer H2's knowing that the oil will just seep back up from the magma...  I am to blame just as the next guy...

I have 2 Mercedes SUV's ML500's gas guzzlers... I was pondering trading one in on a VW TDI until I found that they're manufactured in Mexico:-/  I have nothing against Mexico...just the fact that they rank near the bottom of JD Power on auto repair complaints... so I will wait till 2007 to see what happens with diesel cars in US....

Apologies on the tangent ramblings in advance...

I have a pristine low mileage (82,xxx) 1982 M-B 240D, manual transmission.  31 mpg city and 35 to 42 mpg highway (depending upon speed). Most reliable car M-B ever built (I asked 3 M-B mechanics before buying), old style quality.  And it is definitely a Mercedes, although with steel window winders :-)

There are other options.

I wish I could say the same, my 02 ML500 if I prentend I have an egg under the gas pedal get's 18mpg hwy...

The 05 ML500 has seen 19mpg on hwy...

After coming into the knowlege of where we're headed...PO and all... I could care less what I'm driving as long as it doesn't cost me an arm/leg in repairs...

I've actually been looking at getting a Harley... 57mpg not to bad... just that here in Houston...I would have a survival rate of fly on a frog pond... the commute to Houston from where I live in Sugar Land, TX is insane to say the least...

everyone is doing 85/90 mph... constant lane changing... accidents every day...  I'm just thinking I might not be around very long if I decide to take to two wheels in this environment...

And the best car I ever owned, and probably ever will own. Ours was a 240D with manual transmission (and a sunroof!) It was a bit cranky in the winter, and finally began to wear out at about 375,000 miles. I was very sorry to see it go. Everyone else thought it underpowered, but it was roomy (we hit a moose in it one year)

I really detest cars, and have a growing dislike for driving, but this vehicle and a 1968 Saab 98 I owned in college were the exception.

One more comment as to the way I am reading the article...and I could be goofy since I'm having Captain Morgans over ice...

Saudi Aramco's mature crude oil fields are expected to decline at a gross
average rate of 8%/year without additional maintenance and drilling, a Saudi
Aramco spokesman said Tuesday.

  • Oil field expected to decline (not production expected to decline...
  • without additional maintenance and drilling <-- this is production

    Yes?  No?

    Sip...

  • And if the Saudis get their act together and can keep it at 2% decline...

    Hey wait a minute... you guys said you would be at 12 mb/day by 2009  we're at 9.2 mb/day 2009 at 2% decline "best case scenario with maintenance and drilling"...

    But if world growth is 2% per year, Saudi will need to provide 10,612,080 mb/day...  who will pick up the 1,329,090 mb/day deficit from the Saudis?

    anyone else in OPEC have 1.3 mb/day to spare?

    Conservative 2% decline per year (production!)

    years    production    2% decline    mb/day    year of production
    1    3,600,000,000    72,000,000    9,863,014    2006
    2    3,528,000,000    70,560,000    9,665,753    2007
    3    3,457,440,000    69,148,800    9,472,438    2008
    4    3,388,291,200    67,765,824    9,282,990    2009
    5    3,320,525,376    66,410,508    9,097,330    2010
    6    3,254,114,868    65,082,297    8,915,383    2011
    7    3,189,032,571    63,780,651    8,737,076    2012
    8    3,125,251,920    62,505,038    8,562,334    2013
    9    3,062,746,881    61,254,938    8,391,087    2014
    10    3,001,491,944    60,029,839    8,223,266    2015

    "Or will we wake up one day have hear a huge THUD?"

    IMO, the Saudis have about 80 Gb in recoverable reserves left.

    Graphs at:  http://graphoilogy.blogspot.com/

    OK, 80,000M is somewhat bigger than 260M, so we apparently talking different numbers.  260M is proven reserves right now, 80B is all future discoveries?
    actually they have 260 Billion proven reserves...not 260 Million, we would be in big trouble otherwise.
    OK, thanks - that makes a heck of a lot more sense.  I misread your original post!
    The Saudis claim 260 billion barrels in proven reserves (260 Gb).  

    The HL method gives them 80 Gb.  

    Texas, the Lower 48, Total US, Russia and the North Sea all peaked in the vicinity of 50% of Qt.  None of these regions have shown higher production than what they showed in the vicinity of 50% of Qt.  

    In 2005, Saudi Arabia was at the same point--in terms of depletion--at which Texas peaked.  Texas and Saudi Arabia were the only two swing producers of consequence.

    Only 80 Billion ?

    Wow! I'd like to see the HL chart on that one.

    Have either you or Khebab posted it on another thread?

    I looked at the graph.
    So, I guess 80 billion was a typo?

    You actually meant 180 Billion.

    It may turn out that the US is the Saudi Arabia of Oil, afterall.

    As the far east has popped up in this thread, here are a few news items from China:

    Gas providers are trying to pass on costs to their customers (cities) as they are reaching the point of not making a profit:
    http://news.xinhuanet.com/english/2006-05/17/content_4555872.htm

    China is becoming very gung-ho about biofuels:
    http://news.xinhuanet.com/english/2006-05/17/content_4555470.htm
    I wonder if they will really reach the 10% energy share by renewables in 2020, as stated.

    Finally, we are assured that the Three Gorges Dam is safe from terrorists:
    http://news.xinhuanet.com/english/2006-05/17/content_4563182.htm
    That huge water engineering project is intended, among other things, to be an important source of hydroelectric power.

    Small potatoes - wind power projected at only 1% of energy consumption in 2020.
    Interview with Kunstler on AlterNet:

    Has the Long Peak-Oil Emergency Begun?

    Writer and urbanist James Kunstler talks about America's auto-dependent culture, urban sprawl and what he sees beyond our dependence on oil.
    On page 30 of the latest Technology Review, there is an article about how GE has developed an electrolyzer to produce hydrogen "for about $3 per kilogram -- a quantity roughly comparable to a gallon of gasoline -- down from today's $8 per kilogram".  Also, "GE could potentially manufacture the machines within a few years".
    I'd like to know how many kW hours it takes to make a gallon rather than their dollar cost estimates (which implies something about the energy input requirements, of course). I'd prefer electric + advanced energy density battery technology for future vehicles, but as far as technologies people in this community generally feel are unfeasible, this is my favorite.
    Someone wrote on the TR blog that the $3 does not count the cost of the electricity.  I wonder what the number counts?  The water?
    I could only make a guess that this is the cost of depreciation of the cathode/anode couples. Otherwise it all boils down to the efficiency of the process which AFAIK is ~70% even with old processes. Obviously such cost reduction could not have come from improved efficiency if the price of the input electricity has been the same.
    And the cost of the input electricity will only be going up in the future. Not necessarily in lockstep with the cost of petroleum, but certainly trending in the same direction, for the same reasons. Energy is energy, after all. As opposed to hydrogen, which is simply another means by which to store and transport energy.
    A very efficient process would be to use a combination of nuclear fission reactor to produce heat and some electricity source (solar, wind?) to produce hydrogen via high temperature electrolysis.

    This would eliminate the inefficient heat engines and electricity generators needed to produce the electricity for the electrolysis on large scale. Of course when it comes to nuclear many people automatically say no...

    Very efficient ?  I really don't think so.

    Extracting heat from the safety protected core with minimal heat loss, while creating hydrogen SO close to the core, seems quite problematic.

    IMHO,nuke fans like it becaus eit is nuke, but practically not worth much effort to investigate.

    Hydrogen has uses (upgrade Canadian tar sands, heavy oils, etc.) but I do not see the demand to be so great that R&D should be spent to design the one to 5 or so reactors that would ever be built.  Figure first reactor on-line after 2025.

    Well the idea actually belongs to the Department of Energy... Nothing problematic with using nukes by themself - just take the steam from the secondary circuit (or part of it) and feed it to the elecrolysis device. The problems are actually in this device itself - the cathode and anode must be able to withstand extremely high temperatures under the corrosive environment of the hydrogen and oxygen produced. It must also be huge enough to produce hydrogen on a large scale.
    P.S. I brought up the idea in case we ever decide to produce hydrogen for fuel, not for the tar sands specifically. The need for an efficient large-scale production process if we choose this path is self-evident, IMO.
    IMO, the "Hydrogen Economy" is political BS for the US.  Iceland is a slightly different case.

    I have had three hour plus converstaions with Dr. Bragi Arnason on this subject and related matters.

    Agreed. And there is plenty of evidence to back that up on the internet today.
    I agree that hydrogen economy is a political BS. I only don't see why Iceland should be any different than US - yes, they have cheap electricity but the real killers of the idea are the distribution/storage and fuel cell problems, not the energy source for which we have a bunch of technologies to choose from. If they succeed in overcoming these problems I don't see why I could not copy/paste their experience here.
    That should read...
    I don't see why we could not copy/paste their experience here.

    it seems I took too much load over myself :)

    Ethanol Slaves

    Duration | 28' m/e
    Director | Martti Backman
    Co-production | YLE 2006
    Original title | Etanoli-orjat

    How `green' is the energy, sugar cane ethanol, produced by the world's biggest vehicle bio-fuel producer country, Brazil?

    YLE's journalistic investigation revealed that the growth in the ethanol industry has led to far-reaching social conflicts, human rights violations and outright slavery in Brazilian rural regions.

    The explosion in global demand for sugar ethanol has also destroyed Brazil's natural environment, as millions of hectares of forests and small farms are cleared to make way for sugar cane fields. The industrial cultivation of sugar cane involves the generous usage of pesticides which are detrimental to both nature and the rural inhabitants.

    The documentary 'Ethanol Slaves' divulges the fact that Brazilian sugar smacks of the taste of blood.

    http://www.yle.fi/export/

    Someone call 60 Minutes.

    I'll go one further:

    "Brazil's Ethanol Lesson Is How to Manage Our Oil Addiction"
    David G. Victor

    The Brazilian government is declaring victory in its decades-long struggle to become self-sufficient in the supply of oil. The milestone is cause for celebration in a country that has long paid a high price for imported energy.

    It will also reverberate here in the United States where policy-makers, too, are trying to wean the nation from costly imports, jittery markets and the foreign spigot.

    But we must learn the right lessons. Brazil's success came not from treating oil as an addiction but by producing even more of the stuff and by becoming even more dependent on world markets.

    Here in the United States, most attention to Brazil's fuel supply has focused on the country's aggressive program to replace oil with ethanol that is made by fermenting homegrown sugar. American newspapers are filled with stories about Brazil's famous "flex fuel" vehicles that make it easy to switch between ethanol and conventional gasoline.

    Guided partly by Brazil's apparent success, American policy-makers are crafting new mandates for ethanol, and flex fuel vehicles are now taking shape. We have the impression that ethanol is king.

    In reality, ethanol is a minor player in Brazilian energy supply. It accounts for less than one-tenth of all the country's energy liquids.

    The real source of Brazil's self-sufficiency is the country's extraordinary success in producing more oil. After the 1970s oil shocks, when Brazil's fuel import bill soared, the government pushed Petrobras, the state-controlled oil company, to look asunder for new energy sources.

    Petrobras delivered, especially at home, where the firm pioneered the technologies that make it possible to extract oil locked in sediments under the seabed in extremely deep water.

    In the middle 1970s Brazil struggled to produce just 180,000 barrels of oil per day while importing four times that amount. Today it produces about 2 million and is self-sufficient. Indeed, the current milestone of self-sufficiency arrives with the inauguration of Brazil's newest deep water platform, the P50.

    When P50 reaches its full output later this year, that one platform will deliver more liquid to Brazil than the country's entire ethanol program.

    Brazil's self-sufficiency offers three lessons for U.S. energy policy:

    * First is that ethanol, with current technology, will do little to sever our dependence on imported energy. Today's approach involves growing a crop - sugar in Brazil, corn in the United States - and then fermenting the fruits to yield fuel.

    Sugar plants in Brazil's climate are a lot more efficient at converting sunlight to biomass than is corn in the Midwest, but U.S. policy nonetheless favors corn (and imposes tariffs on imported sugar) because the program is really a scheme to deliver heartland votes rather than a commercially viable fuel.

    Yet, even with Brazil's favorable climate and sugar's inviting biology, ethanol is already reaching the limit. That's because the land and other resources devoted to ethanol can be put to other uses such as growing food and cash crops.

    Indeed, today the Brazilian government is actually reducing the share of ethanol that must be blended into gasoline because sugar growers prefer to make even more money by selling their product as sugar on the world market rather than fermenting it into alcohol.

    New technologies - notably "cellulosic biomass" - could breathe fresh life into ethanol and replace still more oil. Cellulosic biomass is intriguing because it cuts costs by allowing the entire plant - the cellulose in the stalks, as well as the prized grain or sugar - to be fermented into fuel.

    Advocates for this technology, including President Bush in his State of the Union address, have wrongly confused the sexy promise of this newfangled approach to making ethanol with the practical realities of fuel markets.

    Schemes to produce cellulosic biomass, today, work only under special circumstances and nobody has delivered the fuel at the industrial scale that would be required for the technology to become commercially viable.

    * Second, we should learn that, for now, the greatest force to loosen the world's oil markets lies with oil itself. We can use oil more efficiently, as would occur with a gasoline tax or wise fuel economy standards. But we can also find ways to produce more of the stuff - as Brazil did with Petrobras.

    The problem for U.S. policy-makers is that the richest veins for new production lie mainly outside the United States and beyond our direct control.

    Indeed, the Brazilian government made Petrobras more efficient by putting the firm partly beyond its control as well. When the government sold part of the company on international stock exchanges, it accepted Western accounting procedures and other strictures that have given Petrobras the autonomy and accountability to its shareholders that, in turn, helped make it an efficient company.

    We have a stake in seeing other countries do the same - from Algeria to Mexico to Iran and even Russia. But we must remember that Brazil did this on its own, in response to internal pressures for reform, with little leverage from foreign governments.

    * Third, we should learn from Brazil not to confuse the goal of greater self-sufficiency with the illusion of independence. Even as Brazil has become self-sufficient it has also, ironically, become more dependent on world markets.

    That's because the Brazilian government has wisely relaxed price controls so that the prices of fuels within the country are set to the world market. Thus Brazilians see real world prices when they fill up at the pump, and the decisions about which cars to buy and how much to drive reflect real costs and benefits of the fuel they consume.

    That is why, even as the country becomes self-sufficient, Brazilians are working ever harder to be more frugal with oil - because the price at the pump is high and rising.

    Dependence on oil is a liability that must be managed. But it is not an addiction. Efficiency, sober policies toward modest alternatives such as ethanol, and more production - all tools of the manager, not the addict - are required. Brazil helps show the way, but only if we learn the right lessons.

    Victor is director of the Program on Energy and Sustainable Development at Stanford University and adjunct senior fellow at the Council on Foreign Relations, where he directs research on energy policy. His email for contact: dgvictor@stanford.edu"

    http://www.offnews.info/verArticulo.php?contenidoID=4167

    That was an excellent story. I am sure I can find some uses for it. :)

    I even learned a thing or two. Like:

    In reality, ethanol is a minor player in Brazilian energy supply. It accounts for less than one-tenth of all the country's energy liquids.

    I did not know that. Since I try to learn something new every day, thanks for helping me meet that objective for today.

    RR

    My pleasure, RR. Often it is the other way around, glad I could add something. =)
    thank you for the article.
    it will come in handy dispeling the damage the recent peices on ethanol did.
    Yesterday's USAToday had this little gem. Definitely points to what has been said regarding inelasticity in petroleum demand, at least in the US.

    "Most Americans aren't likely to make big cuts in gasoline use.
    By James R. Healey, Chris Woodyard and Barbara Hagenbaugh, USA TODAY
    Americans are unlikely to slice their gasoline use despite high fuel prices -- a striking notion viewed against the current clamor for fuel-efficient cars, the buzz about alternatives to gasoline and the anger about sending our petro dollars to hostile but oil-rich countries."
    http://www.usatoday.com/money/industries/energy/2006-05-15-conserve-usat_x.htm

    The best part of this is that as we incrementally pay more we won't care as much.  It's no different than the frog in a pot of boiling water.  Now if we wake up to an overnight shock, then we wil be singing to the high heavens!

    I laugh at the news!

    i walked 4 miles to get a haircut and buy some eggs this morning.  in a funny transition, i saw a late model ferrari, and one car back ... a genuine moped.  such is life in 2006 california.  (there were a pretty fair number of bikes out.)
    I don't buy it.  April 2006 gasoline use was 1.9% down vs. April 2005.  The "baseline" year-over-year increases are historically 1.5%, so that's effectively a 3.4% decrease vs. the expected pace.

    Prices are having an impact on consumption.

    Source?
    Global Food Supply Near the Breaking Point

    BROOKLIN, Canada, May 17 (IPS) - The world is now eating more food than farmers grow, pushing global grain stocks to their lowest level in 30 years.

    Rising population, water shortages, climate change, and the growing costs of fossil fuel-based fertilisers point to a calamitous shortfall in the world's grain supplies in the near future, according to Canada's National Farmers Union (NFU).

    ...In five of the last six years, global population ate significantly more grains than farmers produced.

    And with the world's farmers unable to increase food production, policymakers must address the "massive challenges to the ability of humanity to continue to feed its growing numbers", Wells said in a statement.

    Kind of puts a damper on the ethanol idea...

    Oh, most certainly.
    I'd planned to post on this earlier, but became sidetracked.
    This has been an ongoing trend for several years now.  
    Very nice work Leanan!
    Here's my contribution on this vein:

    "World grain supplies (coarse grain and wheat) are expected be much tighter in 2006/07, boosting global grain prices. Rising consumption is expected to outstrip production for the second straight year, which would push world grain ending stocks to the lowest levels in more than 25 years."

    http://www.fas.usda.gov/grain/circular/2006/05-06/graintoc.htm

    Yikes.  That graph is as unnerving as the "growing gap" one for oil.

    Most interesting.  It looks like this will be a slow squeeze as stocks are gradually depleted.

    Is there any breakdown anywhere that they give the amount of grain that is harvested which is fed to animals?  I am thinking that this will be the first thing to get cut - reduction in herd sizes along with skyrocketing meat prices.

    Grass-fed animals won't be affected by this except to the extent that shortages of meat from grain-fed animals will cause prices for grass-fed animals to increase as well.

    Hello Leanan,

    Excellent, but depressing post!  Obviously, Peak Everything is gaining momentum: the question is how will the world respond?  Will the basic model be Zimbabwe, Sudan, Iraq, and other horrors?  Or will the world push be in the direction of modeling the energy independence efforts of Sweden and others?

    I still believe triage in the form of large, distinct biosolar habitats with Earthmarine protection will arise in many areas globally.  Even if our global leaders and MSM went to broadcasting Peakoil and global warming 24/7/365: large numbers of detritovores would resist to the last moment of switching over to the new paradigm.  Thus a schism in society will inevitably arise as the biosolar pioneers will seek the safety of 'land lifeboats' while the detritovores, in true denial fashion, will cling to the sinking paradigm til the last second.  The extent of Overshoot relative to what is actually biodiversely sustainable will determine the levels of cooperation and violence as we descend the Hubbert Downslope.

    It is easily foreseeable whereby the elites could abandon the American shores, and take their families and massive accumulations of wealth with them, so that it precipitates a rapid collapse the US society.  Those biosolar pioneers willing to labor and live off what nature purely provides daily will then be in an advantageous position and location to thrive the best.  Appropriate sized Earthmarine no-go buffer zones can then prevent the invasion of the hapless detritivores, who waited too long to shift to a biosolar lifestyle, and now have neither the required minimal natural resources and appropriate skill development to sustain themselves.

    Bob Shaw in Phx,Az  Are Humans Smarter than Yeast?

    Big Oil Launches Attack On Al Gore

    Today, the Competitive Enterprise Institute (CEI) will unveil two 60-second TV ads focusing on what it calls "global warming alarmism and the call by some environmental groups and politicians to reduce fossil fuel and carbon dioxide emissions." The ad, which will be aired in more than a dozen cities across the country, is being released just a week before the May 24th opening (in LA and NYC) of Al Gore's new movie on global warming, An Inconvenient Truth.

    http://thinkprogress.org/2006/05/17/attack-on-gore/

    This is one of the areas in which Big Oil and I have starkly contrasting opinions. I hesitate to even say Big Oil, because some of them do recognize the problem. "Big Oil" in this case appears to be mostly XOM.I  think the position of some others is to acknowledge global warming, but then say "We just can't do much about it".  

    I believe global warming poses a greater immediate threat than Peak Oil. I plan to submit an essay here within a few days explaining my position.

    RR

    IMO, Global Warming is much more real, while Peak Oil is much more immediate threat :)

    I think PO will be mitigated (more or less painfully) but GW is simply a lost cause and we will need to adapt to it.

    well at least we agree on something, but i doubt it's only exon mobile doing the attacking.
    shell and bp are only playing lip service to the people who say global warming is a problem. they might clean up a visible plant here or there in the first world but they don't do a thing to their heavily polluting third world plants that are out of the public eye.
    remember out of sight is out of mind for these people.
    Good article on the ITulip website today about the unique qualities of petroleum that will make it very hard to replace.

    Site http://www.itulip.com/energyandmoney.htm#PartII

    Scientists Back Plug-In Hybrids

    WASHINGTON - A group of scientists urged Congress on Wednesday to fund research for plug-in hybrid vehicles, touting the technology as another way to reduce the nation's dependence on oil through the help of a simple electrical socket.

    With high gas prices straining some Americans' budgets, advocates of the alternative vehicles told a House committee that plug-in hybrids could reduce gasoline consumption and reduce air emissions. And while ethanol-fueled vehicles will require a better network of fueling pumps, a plug-in hybrid car could recharge at home.

    "To think that you could pull into your garage at the end of the day and 'fill 'er up' just by plugging your car into a regular, 110-volt socket in the garage is very appealing," said Rep. Judy Biggert (news, bio, voting record), R-Ill., chairwoman of the House Science subcommittee on energy.

    Leanan -

    "....To think that you could pull into your garage at the end of the day and 'fill 'er up' just by plugging your car into a regular, 110-volt socket in the garage is very appealing," said Rep. Judy Biggert (news, bio, voting record), R-Ill.,...."

    I doubt if she and other proponents of plug-in hybrids have given much thought as to what is on the upstream side of that 110-volt socket. Even plain old run-of-the-mill coal fired power plants have quite a long lead time from decision to build to the time when electricity actually starts flowing. Nukes have an even longer lead time, plus the very real prospect of being tied up in lawsuits for years by various NIMBYs and greenies.  

    So then, how do these people expect that all this massive increase in electricity is going to suddenly appear?  

    Or is this like the 'hydrogen economy', where it is suppose to just 'happen'?

    i guess we crazy californians can pride ourselves that our treehugging electrical regulations have set a good pace.  only 14% of my 2005 power came from coal, only 35% natural gas, for  total of 49% fossil fuels ... half way there.

    (23% nuke, 12% hydro, 10% geothermal .... 3% wind, 1% solar)

    What is geothermal energy?
    on building capacity, is that so hard if you have 10+ years?

    mandate energy star everything, set progressive use rates to slash air conditioning, ... , add some capacity (of any type), charge (small, lightweight, low power) electric cars at night.

    the smaller/efficient gasoline and diesel cars, that 'preserve the suburbs' and cause anti-suburbanites such heartburn, will buy us those 10+ years.

    Plug-in hybrids gain little if any energy efficiency.  Electric railroads, electric mass transit, electric trolley buses all use less energy than the alternatives.  Cheaper to build, and last longer too than plug-in hybrids.

    My paper on the subject (again)

    http://www.lightrailnow.org/features/f_lrt_2005-02.htm

    i think i've had a wait and see attitude with respect to plug-in hybrids.  i don't see them working without a breakthrough in battery technology, and if that happens ... well, we get to see what that tech can do.

    counting technology chickens after they are hatched and all that.

    Right on the nose, odograph!
    Very slowly evolving battery technology continues to be the big stumbling block to many of these electronic inovations, it does not follow Moore's Law and has been substantially lagging most technological improvements in computing, telecommunications, and electrical power storage and distribution.
    Until recently, investment in battery technology has been relatively small. "In the last 100 years, there hasn't been enough work put into batteries. It's just not exciting stuff," says Rob Enderle, an analyst at Enderle Group in San Jose.
    For example: Sony's new PSP only gets 3 hours of battery use before it is dead. Most new laptops can barely get through a DVD before they are out.

    Hell, we cannot even get battery form factors to be standardized.
    There is an excellent article in Popular Science (October 2004, "Your Battery Is Dead", not sure if it's available online) that basically proves what most people have known for a long time: Big companies love to screw you by charging inordinate amounts of money for specialized batteries. To quote the article:

    "Here, for instance, is our favorite Frequently Unanswered Question (FUQ): Why is there an utter lack of standardization in battery shapes, sizes and chargers? Manufacturers will tell you that it has to do with efficient design. Maybe. Richard Doherty of Envisioneering has a darker take:
    Twelve years ago there was an effort by Duracell with all the laptop makers to make a series of universal rechargeable bateries," he says. "Fell on its face -- PC makers found that selling a variety of batteries is more profitable."

    http://www.computerworld.com/mobiletopics/mobile/story/0,10801,98793,00.html?from=story_package
    http://www.engadget.com/2005/01/19/battery-life-isnt-going-to-get-better-anytime-soon/

    I am late sorry . Two notes: Duracell should have gotten into the PC business on the side then. Once ppl were hooked on interchangable laptop batteries, they could licence the formfactor to the clamoring masses and sell off the PC venture. Whatever, they suck. Thank god for AA and AAA standards being as ubiquitous as they are, you can find a lot of portable electronics that will use these and 2500mah out of AA NiMH now. thats better than the 1800Mah you could get a few years ago, so they seem to be cramming more juice into the same space as time goes by, which is promising.
    Joule,

    Think about this a little first....

    Power plants are designed so that we will have enough power available in that region for the highest possible power usage day. For example, in California the highest usage day is usually some day(s) in August/September when the temperature across most of the state is in the 90s and is 100+ in the Central Valley.  The peak usage is usually late afternoon, when businesses are still using some power for lighting and air conditioning and people at home are cranking up their air conditioners.

    However, at 3:00am even though some people may still be using their air conditioners there is plenty of power available.  Right now, temperatures in CA are not that hot yet so there is plenty of power available.  see - http://www.caiso.com/outlook/SystemStatus.html

    So... people could bring their cars home and plug  them in  to charge sometime in the middle of the night.  I don't know what the energy usage of the car would be when it is recharging the car battery... Can someone come up with a number for that? I'm guessing that it is probably lower than  the amount a refrigerator would use per hour.

    Easy to work out. Say a 3-horse motor in a smallish electric commuter rollerskate, that's 2kW while driving. 3 hours on the road per day, 10 hours charging overnight, add another 20% for miscellaneous losses. So you're drawing 2*(3/10) *1.2 = 720 watts while charging.

    That's a lot more than a fridge motor. But a million such cars would only need one typical base-load generating unit to be fully supplied (i.e. 720 megawatts electrical). Regenerative braking might save what, 50%, but the car would be a lot more complex & expensive.

    Does this sound right? Seems amazingly low...

    Peak Everything just keep a rollin' along... the price of uranium has increased by 500% since 2001, and there are fears that supplies will not be sufficient for all the new reactors currently being planned (two per year through 2020 in China alone!)

    Scoop is here >>> http://politics.guardian.co.uk/homeaffairs/story/0,,1777283,00.html

    So much for that "let's all build nuclear plants!" crash fissile pile building program.
    Lots of fuel left.

    Former weapons  LOTS there

    Recycled spent fuel (a majority of the U-235 is not burnt, and lots of Plutonium and higher products left that burn well).

    New discoveries.  Unlike oil, there has been little incentive to look for uranium in the last 3 decades.

    Breed Thorium.  In a CANDU reactor, mixing in thorium will not breed more U-233 than U 235 burnt (from memory), but it will extend fuel life considerably (50% to 80%).

    The point is that higher uranium prices will make hundreds of closed mines economically viable.  
    Air France - KLM posted their earnings

    Air France-KLM Profit Falls 30% as Oil Costs Increase

    or

    Air France-KLM FY net soars 29.3 pct to 913 mln eur despite heavy fuel charge

    Fun part is: Same company, same numbers, same press release, completely opposite reporting. Pick the one you like most, or is the most covenient at the watercooler ;-)

    Background http://observer.guardian.co.uk/columnists/story/0,,1776877,00.html