Decius wrote:
] ] At current rates of production, there were 40.6 years of
] ] consumption covered by proven reserves in 2002, the latest
] ] data available, according to the Wall Street Journal.
] ]
] ] The newspaper, citing the BP Statistical Review, said
] ] that in 1989, there were 44.7 years left of consumption.
] ]
] ] "[A shortage] will probably happen in the next 10 to 20
] ] years," Professor David Goodstein, a physicist at the
] ] California Institute of Technology, told CNNfn.
]
] hrm...

I know you and Bucy probably think I'm drinking the Kool Aid on this, but I really do think we are facing a pretty damn big problem. The good news out of this is that:

In 1989, they said we had 44.7 years left.
In 2002, they said we had 40.6 years left.

Obviously, there is a 13 year span there, with only a 4 year difference. Obviously predictions are wrong. I agree with that, because you can never know all the variables like technological advances, new finds, etc.

Still, the figure did not stay flat or increase. The next thing that will happen is the drilling of the ANWR. I don't see that as a problem really, because current estimates are that there are between 3.5 billion and 20 billion barrels sitting under there. Environmentally speaking, pipelines that are in place now at Prudhoe field has actually allowed an INCREASE of caribou population, because the pipeline is a safe haven. I sit on the fence on that issue and lean towards exploiting ANWR.

But the constant that I've seen out of all the historical data is that the time is running out. That obviously makes logical sense, there is going to reach a point where we recover everything that makes sense to recover, without delving into negative energy returns. That will occur on the downslope, it's just inevitable.

The thing we have to consider in the short term is how much of a dependency we have on fossil fuel for our energy. The electric grid is 70% fossil fuel based, that's just a fact, and the growth rate for new plants here is tied in at a 90% growth rate right now to fossil fuels. And we all know that transportation is basically 95% or greater tied into fossil fuels. Ultimately the ERORI ratios are what matter. And the fact is that none of the technologies as they exist today will be able to make up the difference in what we will lose in fossil fuels, today.

Will technological advances be able to sustain the current demands? I wish they could, we'll see just how well human ingenuity fares in the face of this. If they can, will they be able to sustain AND meet the current global growth rate of consumption? That's asking for quite a lot of technological advance. And it's asking for it in a world where a critical resource is suspected to be reaching its peak production, with a regional war brewing in the area where most of the reserves of the resource are left.

I ... [ Read More (0.8k in body) ]

Hijexx wrote:
] Obviously, there is a 13 year span there, with only a 4 year
] difference. Obviously predictions are wrong. I agree with
] that, because you can never know all the variables like
] technological advances, new finds, etc.

You cover a lot in your post. I'll offer the following:

1. You writings on this subject have caused me to pay closer attention to it.
2. Clearly there is significant risk of depletion of oil reserves within our lifetimes.
3. I went and researched some other fossil fuels. The US has enough natural gas to provide its own supply for 70 years at the current rate of consumption, and the US supply is dwarfed by that of other countries. The U.S. also has 266 years of coal at present consumption rates. (Although in this case the U.S. appears to have 25% of the world's known coal supply.) Obviously the present rate of consumption isn't terribly helpful, but in any case we have enough of these resources to last for several generations even with significant growth.
4. As I've repeated said, the writing is on the wall. It is silly to ignore the problem.
5. Massive changes in the way American society is organized can not be expected to occur overnight. Any large scale change is risky and difficult to undertake. It must be carefully pursued.
6. If you want to reduce comsumption of oil, taxes are not an unreasonable approach and other countries employ them, but such a program cannot be pursued unless its coupled with the development of alternative methods of transportation. Europe can run high gas taxes because Europe has a great rail infrastructure. There is a massive investment to be undertaken here if we wish to pursue that approach. We appear to be pursuing an alternative approach of switching to fuel cell/electrical vehicles. This is, frankly, a similar strategy in the sense that both rely on central generation of electrical power and the question remains how do we generate that power without fossil fuels. Its a problem we have to solve, but not one we have to solve within a couple of decades.
7. Newsgateway.ca mostly consists of peak oil discussions and various 9/11 conspiracy theories, including articles like "Consider 20 parallels between the USA today and Hitler’s Germany." Its about as fair and balanced as fox news. Debating this in detail is really beside the point.

Decius wrote:

] 1. You writings on this subject have caused me to pay closer
] attention to it.

Really good to hear, thanks for sharing your thoughts. On the same note, the discussion has been making me rethink some of my positions on the issue and look deeper for answers. I see this as extremely encouraging. We are all bright enough to work on this problem and start coming up with good solutions.

] 3. I went and researched some other fossil fuels. The US has
] enough natural gas to provide its own supply for 70 years at
] the current rate of consumption,

Where did you read this? I refer you to this study:

http://www.bp.com/sectiongenericarticle.do?categoryId=119&contentId=2004165

This is BP's Statistical Review of US Energy, 2003. There is a PDF available. It's really easy to get it, just hit BP's website and search for "statistical review" 2004's probably won't be available for some time. BP has done an excellent job with their data layout.

Quoting from the section on natural gas, these are US stats:

---------------

At the end of 2002:

Proved Reserves: 5.19 trillion cubic metres
Production: 547.7 billion cubic metres
Consumption: 667.5 billion cubic metres
R/P Ratio: 9.6

Glossary:

Proved Reserves: Generally taken to be those quantities that geological and engineering information indicates with reasonable certainty can be recovered in the future from known reservoirs under existing economic and operating conditions.

Reserves/Production (R/P) Ratio: If the reserves remaining at the end of the year are divided by the production in that year, the result is the length of time that those remaining reserves would last if production were to continue at that level.

---------------

That gives the US about 10 years of natural gas. Also from the study's forward:

"On the gas production side, North America was the only region to see a decline. A price-driven drop in drilling activity following the boom of 2001 explains some of the decrease, but the maturity of the USA and Canada from a resource perspective also seems a contributing factor."

You may be asking yourself, given the number above, "Where are we making up the 100 billion cubic metres difference between production and consumption?" The answer: Canada. We imported 108.8 bcm from them in 2002. Guess what Canada's R/P ratio is? 9.3 years.

See why having gas fired electric plants account for 90% of all new electric plant growth is short sighted? They are counting on the LNG infrastructure to be in place by then.

I need to locate an article I found about the logistics of LNG, but to give you an idea of what is in place today, the US has four LNG terminals. The numbers weren't encouraging from what I rememeber.

] that power without fossil fuels. Its a problem we have to
] solve, but not one we have to solve within a couple of
] decades.

See above. It is upon us my friend, if studies like these are to be believed.

] 7. Newsgateway.ca mostly consists of peak oil discussions and
] various 9/11 conspiracy theories, including articles like
] "Consider 20 parallels between the USA today and Hitler’s
] Germany." Its about as fair and balanced as fox news. Debating
] this in detail is really beside the point.

Agreed. I actually found it doing Google searches for things like "peak oil is a sham" "peak oil is a farce" etc. Just trying to find opinions on the other side. The page I meme'd was the first page I had ever seen on that site. I liked all of the points that were discussed, mainly because Heinberg's book was something that I was reading at the time and he was quoted quite heavily on the page. Easier than me typing it all in from the book.

Hijexx wrote:
]
] Where did you read this? I refer you to this study:

The difference is whether you consider estimated or proved reserves. The people who are arguing that we're about to run out of natural gas are arguing that all the estimates are wrong and that there is no more natural gas out there then we've already located. They also seem to be ignoring several new sources of natural gas because we haven't perfected extraction technologies. Historically increases in proved reserves have matched increases in consumption.

http://www.epa.gov/cleanenergy/natgas.htm

In 2000, natural gas reserves in the United States were estimated to be 1,190 trillion cubic feet, and U.S. gas production was 19.2 trillion cubic feet.

61 years...

http://www.naturalgas.org/overview/resources.asp

The graph below shows the change in proved natural gas reserves in the United States from 1990 to 2000, as recorded by the EIA. As can be seen, the levels of proved reserves in the United States have not changed significantly over the past 10 years. If the additions to proved reserves in a given year are larger than the subtractions from production, then proved reserves will increase, and vice versa. Usually, however, the additions are close enough to the subtractions to maintain a relatively constant level of proved reserves.

This peak oil website juxtaposes the above information with the idea that the total number of wells we drill seems like "a large number."

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

In June 1999, a disturbing article was published in Oil & Gas Journal. It described how Texas, which produces one-third of the nation's gas, must drill 6,400 new wells each year to keep its production from plummeting. That's 17 wells each day. As recently as 1998, the state only needed to drill 4,000 wells to keep annual production steady. The reason for the change? As drillers target ever-smaller pools, new wells experience steeper depletion rates. Indeed, a typical new well has an astounding first-year decline of 56%, which is another way of saying it begins dying soon after it is born. No one likes talking about depletion; it is the crazy aunt in the attic, the emperor without clothes, the wolf at the door. But the truth is that drillers in Texas are chained to a treadmill, and they must run faster and faster each year to keep up.

I don't really understand this concern. The number of wells drilled is increasing. This reflects increase in demand. It can reflect smaller well size, but the fact that we are tapping smaller wells doesn't directly imply that there are no larger wells to tap. The economics are more complex then that. Some wells are easier to tap then others. Cheaper transportation costs are a huge factor. In the US much of our supply is on federal lands and is illegal to tap. Furthermore, there are new t... [ Read More (0.1k in body) ]

Decius wrote:

] In 2000, natural gas reserves in the United States were
] estimated to be 1,190 trillion cubic feet, and U.S. gas
] production was 19.2 trillion cubic feet.
]
] 61 years...

Nice find. And the graph showing the steady level of proved reserves was enlightening as well. I guess this means that "proved" reserves should be analogous to "what the market will bear." Still, we've burned through almost 1000 tcf of natural gas over the course of using it. That's putting us at the halfway mark if you consider the total reserves, not just proved. Those figures do not take into consideration how much of it will be left in the ground either. Surely we cannot recover all of it. We could, but will it take more money and energy to extract than what it is worth or what energy it yields? These questions though, they are ones we will not have answers to until more time elapses. I would caveat looking at total reserves just as you caveat looking at proved reserve figures.

Consumption keeps rising at a fairly linear rate. I understand what you are saying about 1 well on a 100 unit field versus say, 2 wells each on 50 unit fields. In that case, it is not particularly alarming from a pure arithmetic standpoint. But consider that you may now be expending twice the energy to produce the same unit amount. Each well takes energy to create, operate, maintain, and decommission. What these studies lack is a granular breakdown of each field and where the EROEI ratios are trending. If market rates are any indication, those ratios are falling.

As the production switches from conventional to unconventional gas reserves, the economic cost will rise and the EROEI ratios will fall. I know that's a blanket statement that doesn't account for technological advance, but history bears it out as true so far. If it were economical, these reserves wouldn't be unconventional. The sharp rise in NG prices is reflecting this trend. That and the ramp up of LNG imports on the horizon.

As this happens, everything is going to become more expensive. This is something that even the "proved" reserve figures probably do not adequately account for. But the point has not be lost that you just made, that "proved" reserves should be considered in concert with other factors.

Delving into the political landscape for just a second, we might believe that the war is affecting these trends. Surely it is, but take a look around. I don't believe this war is going to end. Our leaders say as much. Consider that outside influencing factor a constant from here on out.

] Some wells are easier to tap then others. Cheaper
] transportation costs are a huge factor. In the US much of our
] supply is on federal lands and is illegal to tap.

Transportation ties in with the point you made above about the 61 year supply. It's nice to know we have reserves, but getting them to market is a different sto... [ Read More (0.3k in body) ]

Hijexx wrote:
] As this happens, everything is going to become more expensive.

I agree. But, in a sense, it "costs" more to produce pentiums then 386s...

] Delving into the political landscape for just a second, we
] might believe that the war is affecting these trends. Surely
] it is, but take a look around. I don't believe this war is
] going to end. Our leaders say as much. Consider that outside
] influencing factor a constant from here on out.

I agree. Thats basically my reply to assertions that this is an "war for oil." The cost advantages of energy from iraq are going to be minor compared with the overall cost of this conflict. The WOT may last a long long time. The Iraq situation has been looking more grim recently. We may be mired in it for a while too.

] ] Furthermore, there are new technologies for extracting
] natural
] ] gas that have nothing to do with wells.
]
] Which new extraction technologies are you referring to? I'd
] like to research them.

That natural gas website I linked offered a lot of examples, some with very high potential returns.

] It looks interesting. Do they exist in concentrated deposits?
] How much of our energy today is produced from them? How
] quickly could it be ramped up? Is it economically and
] chemically feasible?
]
] Or, put another way, is this the natural gas equivalent of
] fusion? Lots of promise, little results.

Methane Hydrates were discovered very recently. Its too soon to tell. Most of these things are in the middle. They aren't as hard as fusion, but we don't have all of the technology worked out right now.

[ There's far more in Hijexx's analysis than I hope to address easily, but one point stuck out at me and I thought I'd mention it... you write

"Yes, some of the stuff is the same thing some people of a party would say, like saying "conserve energy!" But is that really a political statement? To me, it sounds like common sense. To me, reducing consumption makes sense as a sound policy. To others though, that believe the market should allow you to consume more if you are willing to pay for it, that's fine too. But it fails to account for the big picture. It's a myopic view. It's a faith that technology will just magically bring in an equally efficient oil substitute at the same rate that the oil becomes infeasible to use and sustain the growth rate we have been accustomed to with oil."

I'll start by agreeing that energy conservation is almost certainly the best short term response we, as a society, can have. Arguing so is political only because it's impossible to separate beliefs from politics, or at least I've always thought so. You vote your beliefs... the politics are inherent in that. Anyway, that's not the key thing i wanted to say.

You mention the market here, and note that most market analyses fail to look much beyond the current environment. This is, I think, interesting, and mostly true. I think it's a given that the markets act as a feedback mechanism on consumption... prices increase as supply decreases. I'll take it as a given that demand won't decrease, and will almost certainly increase, so we need more supply, from alternate sources.

I'm finally at my point which is the question of wether the feedback mechanism offered by the market, coupled with the subtle effects activism on the part of people like yourself, will ultimately exert the necessary pressure to instigate alternate supply in time, or wether the market will delay too long.

I tend to believe the former... that the feedback will occur with time enough, if barely, to acquire alternate sources of supply. It seems you would take the opposite opinion... that it's already probably too late to acquire enough alternate energy supply.

I'm not sure there's an answer, and perhaps it doesn't matter... in the time we have, we should probably agitate for reducing energy consumption and development of viable alternatives to oil, regardless of if we think it'll get done in time. Is there another choice? -k]