Peak-oil debate crackles anew

[peejay 327]

Peak-oil debate crackles anew

New estimate of what's left clashes with view of naysayers

By KRISTEN HAYS

Copyright 2006 Houston Chronicle

The world's oil resources won't last forever, but production should increase for at least another quarter-century thanks to technology and unconventional sources that "peak oil" theorists often discount, analysts with Cambridge Energy Research Associates said Tuesday.

Peter Jackson, director of oil industry research for CERA, and Daniel Yergin, CERA chairman and author of The Prize: The Epic Quest for Oil, Money & Power, took aim at oft-repeated theories that a peak and subsequent drop-off in world oil production is imminent or even ongoing.

They said during a conference call to analysts and reporters that a CERA analysis shows a global oil resource base of 3.7 trillion barrels, or three times as large as the 1.2 trillion barrels estimated by many peak-oil theorists.

That resource base includes conventional oil, extracted from the ground or shallow offshore waters, and unconventional oil, or that derived from oil-soaked sands, condensate and natural gas liquids or coal turned to liquid.

CERA's stance that world oil production isn't hitting its peak in the near future isn't new. Tuesday's report built on that position by emphasizing that oil sources are increasingly being found — and technologies are being advanced to access them — other than the traditional realm of drilling a well onshore.

"What we're saying is, 'Don't just look at conventional oil,' " Jackson said in an interview after the conference call.

"This is the fifth time that the world is said to be running out of oil," Yergin said on the call. "Each time — whether it was the 'gasoline famine' at the end of World War I or the 'permanent shortage' of the 1970s — technology and the opening of new frontier areas has banished the specter of decline. There's no reason to think that technology is finished this time."

Their position contrasts with that of Matthew Simmons, chairman and CEO of Simmons & Company International and author of last year's Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy.

Simmons, who was in Africa and unavailable for comment Tuesday, said in a presentation last month, at the Association for the Study of Peak Oil and Gas World Oil Conference in Boston, that estimates of undiscovered oil were not "bankable events." The association contends that oil production will decline after peaking in 2010.

Simmons also said in that presentation that U.S. Energy Information Agency data will soon confirm whether record world crude supply in December last year was or was not at its peak.

"If we wait too long for proof, we miss opportunity to prepare for post-peak oil," Simmons' presentation materials said.

Fast action urged

U.S. Reps. Roscoe Bartlett, R-Md., and Tom Udall, D-N.M., co-chairmen of the Congressional Peak Oil Caucus, said in a prepared statement Tuesday that CERA's report shows that the government should act fast to mitigate effects of a peak and decline in production because such action could take 20 years to materialize. But they criticized CERA's reliance on reserves data from the U.S. Geological Survey, which they said almost doubles the amount of projected reserves.

"That means world oil production will peak much sooner than CERA projects in this report," they said without estimating when that peak would come.

Jackson said the CERA report was intended to foster "a rational and measured discourse" about challenges with meeting oil demand.

Unconventional sources

The 11-page report said demand could outstrip conventional crude oil supplies, but that excludes unconventional production as well as growth areas such as the Gulf of Mexico, Brazil and Angola.

"We reaffirm our view that there is no imminent peak, nor do we imagine that oil supply will run out dramatically soon thereafter," Jackson said.

Instead, CERA forecasts that global production will rise more than 50 percent to 130 million barrels a day by 2030, and then will eventually follow an "undulating plateau" before starting a slow decline around 2050.

During that plateau period, the gap in conventional oil production and demand growth will have to be met by fuels derived from unconventional production.

"Those who believe a peak is imminent tend to consider only proven remaining reserves of conventional oil, which they currently estimate at about 1.2 trillion barrels," the report said.

http://www.chron.com/disp/story.mpl/headli...iz/4335508.html

[Hilarious Clinton 452]

Buy a Hummer. I'm going to be carrying my groceries in style.

[mawilson 2,133]

Dude, there's plenty of oil. Canada alone has more oil than the entire Middle East.

Russia has massive undiscovered reserves. We're good.

[Hilarious Clinton 452]

Dude, there's plenty of oil. Canada alone has more oil than the entire Middle East.

I've known that for years. It's just more expensive to get to, but as technology improves it will drive the price down.

[mawilson 2,133]

Dude, there's plenty of oil. Canada alone has more oil than the entire Middle East.

I've known that for years. It's just more expensive to get to, but as technology improves it will drive the price down.

Oh I know you have Rich. I was talking to peejay - he's the one always posting

scary stories about running out of oil tomorrow.

[Hilarious Clinton 452]

Dude, there's plenty of oil. Canada alone has more oil than the entire Middle East.

I've known that for years. It's just more expensive to get to, but as technology improves it will drive the price down.

Oh I know you have Rich. I was talking to peejay - he's the one always posting

scary stories about running out of oil tomorrow.

I knew that you knew that I knew.

[peejay 327]

Dude, there's plenty of oil. Canada alone has more oil than the entire Middle East.

I've known that for years. It's just more expensive to get to, but as technology improves it will drive the price down.

Oh I know you have Rich. I was talking to peejay - he's the one always posting

scary stories about running out of oil tomorrow.

The Houston Chronicle business section is not exactly the National Enquirer or the Hooterville Town Press. This debate of oil feast or famine has popped up with the recent price rise of crude oil and some heavyweights in government questioning the security wisdom of relying on so much imported oil from nations hostile to America. I can't help it if it scares you, but apparently not very much since apparently we have an unlimited supply right here in North America.

Everyone is entitled to their own opinions, but no one is entitled to their own facts. Apparently even the heavyweights in the industry are divided between the feast or famine scenarios. I find it interesting that there is no consensus even among the heavyweights in the industry. That is scary because that means no one is really sure.

No...we will not just run out of oil and be done with it tomorrow. It is the price spikes and shortages that will get disrupt our lives and hit the American economy.

Here is an interesting link with more interesting links of studies. Apparently there are others in government that are concerned with our energy future.

http://bartlett.house.gov/EnergyUpdates/

[Hilarious Clinton 452]

The price of gas (in the US) going above $3 a gallon created a whole new category of cars with the Hybrid. This trend will continue. As oil gets more scarce the price will increase which will encourage people to invent better technology. There's no motivation to get off our oil addiction as long the price remains low.

capitalism is the answer

[mawilson 2,133]

No...we will not just run out of oil and be done with it tomorrow. It is the price spikes and shortages that will get disrupt our lives and hit the American economy.

If it hits our economy, it will hit everyone else's too.

And no, I don't find these stories scary -- I remember being told as a kid that we

have enough oil for the next 40 years, and that we have almost reached peak

production. 15-20 years later, the same story and the numbers haven't changed.

Oil companies would tell you that to keep the prices high, wouldn't they?

Besides, it's like LS said -- we will have alternative sources of energy in no time

when and if we need them.

[isleta521 5]

A couple of examples in South and Central Am.: Pemex, the Mexican National oil company is starting to see some decreases in their status-quo production from some of their best fields while companies like Petrobras (Brazil) have discovered new resevoirs near the Campos Basin.

I dont think anyone knows for sure when we will run out of oil. Some day for sure. In our lifetime? Doubt it. Your childrens - maybe a slight chance. I do think some day its possible but it would prob be a gradual thing with hopefully new tech for energy.

Perhaps we will have a third world war before then and then problem solved.