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Peak Oil Matters

A fresh perspective on the concept of peak oil and the challenges we face


Tag: Bakken Formation









Diminishing returns occurs when it takes more and more energy or other resources to produce the same amount of goods. In the case of oil supply, we reach diminishing returns because companies extract the easy-to-extract oil first. Thus, the price of oil rises continue reading…





An observation worth noting … and pondering, from Sharon Astyk.

The problem is that most people – including decision makers – have no time, no inclination, and no expertise to go in depth in issues such as resource depletion. So, when facing a complex and nuanced issue they tend to choose the interpretation that they like best – it is called ‘confirmation bias.’ Now, surely good news are better than bad news and for most people an apparently authoritative study that says that we are not running out of oil is preferable to the gloom and doom of most depletion studies.

The recent and much-touted International Energy Agency report, citing among other expectations the United States’ rise to the top of the oil production pyramid in a few short years, was certainly music to the ears of those hoping for some good news and verification that the “theory” of Peak Oil has at last (once again) been put to bed.

Good news everyone! Business as usual is just around the corner! No pesky energy conservation measures and no diversion of funds to research alternative sources. Nothing but smooth sailing ahead. Anyone seen any Hummers for sale?

Who cares about facts when such good news is just there for the picking, right? Continuing depletion of conventional resources? We’re not gonna pay any attention to no stinkin’ depletion … that just musses up a good story. We’re just gonna keep frackin’, consequences and facts be damned. Full speed ahead … we’ll worry about the Wall when we get close.

Who cares about how many wells must be drilled almost constantly to maintain some semblance of increasing production? Costs per well? Who cares? Keeping oil prices high to justify all that extra drilling and investment? We’ll figure something out soon enough….Rapid depletion of new wells in the tight oil formations of the Bakken and elsewhere? Can’t be bothered to worry about that! We’ll just drill more!

So what if most of the good stuff has already been found and produced … we’ll just drill even more, dammit!

No time for plans; no time for intelligent and reasoned assessments. And damn sure there’s no time to explore opportunities or make use of our great attributes to consider other options. Nope! Gotta drill, baby, drill!

Good news is good news, even if the facts and reality suggest otherwise. Hell of a strategy….Just wish we weren’t all getting dragged along for the unpleasant ride.

* My Photo: Rockport MA – 05.16.11





There’s been a fair amount of rejoicing in some circles of the energy world in recent weeks on the heels of the wildly optimistic forecasts for future oil production as contained in the recently-released 2012 World Energy Outlook by the International Energy Agency (IEA). As if the generous expectations weren’t enough, miracles of miracles the good ‘ol U S of A is predicted to once again be Number One in world oil production in less than a decade.

Peak Oil is history! Hooray for us. The Magic Technology Fairy has come through just in the nick of time. What a holiday gift for everyone; those gas-guzzling SUVs should start flying out of showrooms any day now.

But every now and then, a little rain must fall on parades. Facts and reality have made their way into the dialogue about our future “energy independence.” A slightly different story results when those in the know take a look behind the International Energy Agency’s curtain.

Yes, United States’ oil production has risen in recent years. No one disputes that. However, few in the media and fewer still who should know better (and most likely do), decide against telling the whole story. Why bother to let the rest of the world know that the rise in oil production still leaves us many millions of barrels per day short of our 1970 production peak? [It goes without saying that those who deny the facts never get around to pointing out pesky little factoids such as the IEA’s own caveats, or that it is once again asserting a portion of the increase in U.S. oil production will come from fields “yet-to-be found.” Good to be optimistic!]

Adding liquids to the production totals which should not be factored in adds another feel-good element to the story of oil abundance, but that’s not exactly the truth, either.

[N]atural gas liquids are not equivalent to oil. They contain only about two-thirds of the energy content of oil; they are far less versatile in their applications; and only about 19 percent of a barrel of natural gas liquids is actually usable as vehicular fuel. If the implication is that the U.S. is going to be able to drive around on its own domestically-produced fuel, then that implication is simply wrong. [1] [See this also].

So while gushing over our marvelous ingenuity and technological prowess in having revolutionized oil production by utilization of “fracking” to blast open shale formations and release oil trapped in the layers [a very simplistic explanation of what is actually a complex process], those who deny the reality about our fossil fuel resources never get around to sharing important details which most of us should be aware of. Who benefits when the details are omitted, shaded, or hidden? Fairly certain it’s not you or me….

Even just a few more of those damned annoying facts dull the luster of the feel-good news. And I won’t begin to discuss the environmental issues associated with fracking, our ongoing failure to invest more aggressively in alternative energy options, or the effects on climate change—but thank goodness that’s a “hoax” perpetrated by tens of thousands of scientists who are scheming to … ah, do things in … um, certain ways to … ah, get some … uh, benefits of some kind.

[I’d highly recommend reading the articles cited in the “Sources” section below to get the full picture….]

Recent US news reports have highlighted the fact that US oil production has been rising and is now higher than it has been in years. Reports that highlight the recent US oil production increase don’t mention that oil production outside of Texas and North Dakota has actually declined in the last few years….
It appears to me that in the near future, the prime producing area within the four [North Dakota] counties is going to be saturated with oil wells considering that the fracking wells being used can extend up to approximately 2 miles. Assuming that the industry continues to add new wells rapidly, they will have to go to less fruitful areas outside of the prime producing area.
Oil wells in the Bakken region decline rapidly. From data I’ve seen, the average decline in the first year is ~60%. The only way to maintain or increase Bakken oil production is to rapidly increase the number of wells.
As the industry has to drill in less fruitful areas, being able to maintain production will become an increasing challenge. [2]

[P]resently the commercial profitability for new wells is barely positive.
The ‘average’ well now yields around 85 000 Bbls during the first 12 months of production and then experiences a year over year decline of 40% (+/-) 2%
The recent trend for newer ‘average’ wells is one of a perceptible decline in well productivity (lower yields)
As of 2007 and also as of recent months, the total production of shale oil from Bakken, has shown exceptional growth and the (relatively high) specific average productivity (expressed as Bbls/day/well) has been sustained by starting up flow from an accelerating number of new wells
Now and based upon present observed trends for principally well productivity and crude oil futures (WTI), it is challenging to find support for the idea that total production of shale oil from the Bakken formation will move much above present levels of 0.6 – 0.7 Mb/d on an annual basis.
Authoritative research companies (like Bernstein Research) and widely acknowledged specialists/institutions like USGS and SPE have recently and in general arrived at identical conclusions by applying different sets of methodologies and from studying other areas….
The wells normally have a high production at start up that rapidly enters into steep declines.
To facilitate growth in total production an accelerating number of wells needs to be brought into production.
To sustain a plateau requires a continual addition of a high number of producing wells. [3]

One reason the WEO 2012 estimates are unreasonable is because the oil prices shown are unrealistically low relative to the production amounts forecast in the report. This seems to occur because the IEA misses the problem of diminishing returns. As the easy-to-produce oil becomes more depleted, and we need to move to more difficult reservoirs, the cost of extraction increases.
In fact, there is evidence that the ‘tight’ oil referenced in Exhibit 1 is already starting to reach production limits, at current prices. The only way these production limits might be reasonably overcome is with higher oil prices–much higher than the IEA is assuming in any of its forecasts.
Higher oil prices cause a huge problem because of their impact on the world economy. The IEA in fact mentions that current high oil prices are already acting as a brake on the global economy in its first slide for the press. Higher oil prices also mean that investment costs required to reach target production levels will be even higher than forecast by the IEA, adding another impediment to reaching its forecast production levels.
If higher prices put the economies of oil importing nations into recession, then oil prices will drop lower, reducing the incentive to invest in new oil production infrastructure….
There are other issues as well. If there is a need to drill an increasing number of wells just to stay even, or an even larger number, to increase the amount of oil produced,  we start to reach limits on many kinds: number of rigs available, number of workers available, miles driven for water to be used for fracking. Perhaps the issue that will limit production first, though, is limits on debt available to producers. Rune Likvern has also shown that cash flows from tight oil extraction tend to run ‘in the red,’ so an increasing amount of  debt financing is needed as operations ramp up. At some point, companies hit their credit limit and have to stop adding new wells until cash flow catches up. [4]

But wait, suggests the IEA, there’s still one wild card hope out there: Iraq. Yes, Iraq. In the belief that the Iraqis will somehow overcome their sectarian differences, attain a high level of internal stability, establish a legal framework for oil production, and secure the necessary investment and technical support, the IEA predicts that its output will jump from 3.4 million barrels per day this year to 8 million barrels in 2035, adding an extra 4.6 million barrels to the global supply. In fact, claims the IEA, this gain would represent half the total increase in world oil production over the next 25 years. Certainly, stranger things have happened, but for the obvious reasons, it remains an implausible scenario. [5]

I’ll ask the same question I and others have asked on countless occasions: Wouldn’t it be a good idea to do a bit of planning for something other than fossil fuels as our energy supplier?

* My Photo: low tide at Good Harbor Beach, MA – 11.13.12


[1]; U.S. will not surpass Saudi Arabia’s oil production by 2020 by Chris Nelder – 11.28.12
[2]; A Closer Look at Bakken and U.S. Oil Production by Roger Blanchard – 11.21.12
[3]; Is Shale Oil Production from Bakken Headed for a Run with “The Red Queen”? by Rune Likvern – 09.25.12
[4]; IEA Oil Forecast Unrealistically High; Misses Diminishing Returns by Gail Tverberg – 11.13.12
[5]; World Energy Report 2012: The Good, the Bad, and the Really, Truly Ugly by Michael T. Klare – 11.27.12

We are at a key turning moment in history. The actions that we will soon decide to take will be determined by the beliefs we hold. At a time like this, holding the wrong set of beliefs can destroy your wealth, sap your joy, and even prove to be life-shortening. [1]

Sober thoughts, but ones we need to not only contemplate with more vigor than we have so far (leaders in both industry and government have fallen woefully short of the mark in their truth-telling responsibilities), so too must we start planning—a theme I’ve raise more frequently in recent months.

Despite yet another seemingly optimistic observation such as this one:

THE reversal of fortune in America’s energy supplies in recent years holds the promise of abundant and cheaper fuel, and it could have profound effects on what people drive, domestic manufacturing and America’s foreign policy. [2]

another recent headline, courtesy of Steve LeVine (Foreign Policy), is a more realistic, fact-based  truth, and one whose implications many more of us need to understand: “The age of irrational petro-exuberance.”

The reasoning is fairly straightforward, nicely summarized first by Jesse Parent, and then by Tom Murphy:

[T]here is an inherent cut-off point approaching – and it is very different from the shocks, jolts, and other experiences that formed our current national paradigm of energy and gas prices.
That is the point that I feel needs to be stressed, and it’s lack of emphasis, in my opinion, is the substantial failure of our energy education. Until this realization is made commonplace, the hardships we will endure (are enduring) won’t make sense, and the obstacles in the way of a logistically sustainable future will not have proper context. The world as we know it was built via cheap, easily transportable, and highly dependable fuel, and that fuel is essentially non-renewable in supply. At present, there is no substitute for fossil fuels in this way, as per the actual capacity to supply us with the energy we need to live in the society we do….
Discerning who is to blame for a substantial failure in energy education may not be as important as accepting the responsibility to educate ourselves….
[T]he broader, inherently global context of America’s energy situation needs its own special attention. Transitioning from a culture of blame and neglect to sober understanding and responsibility is likely not something that can come from an administration, particularly given the current political climate. An understanding that sustainability is not merely some matter of environmental concern, but an imperative of cold facts and impersonal logistics, is necessary. It will take courage and intellectual rigor to move past the conveniences of political rhetoric, finger pointing, and the     overshadowing of vital energy issues by more accessible (but more tangential) news trends, but doing so is part of accepting the responsibility that enables choosing the best future – for our country and our planet. [3]

[O]ur reaction to a diminishing flow of fossil fuel energy in the short-term will determine whether we transition to a sustainable but technological existence or allow ourselves to collapse. One stumbling block in particular has me worried. I call it The Energy Trap.
In brief, the idea is that once we enter a decline phase in fossil fuel availability—first in petroleum—our growth-based economic system will struggle to cope with a contraction of its very lifeblood. Fuel prices will skyrocket, some individuals and exporting nations will react by hoarding, and energy scarcity will quickly become the new norm. The invisible hand of the market will slap us silly demanding a new energy infrastructure based on non-fossil solutions. But here’s the rub. The construction of that shiny new infrastructure requires not just money, but…energy. And that’s the very commodity in short supply. Will we really be willing to sacrifice additional energy in the short term—effectively steepening the decline—for a long-term energy plan? It’s a trap!…
The only way out of the political trap is for a substantial fraction of our population to understand the dimensions of the problem: to understand that we’ve been spoiled by the surplus energy available through fossil fuels, and that we will have to make decade-level sacrifices to put ourselves on a new track. The only way to accomplish this is through sober education, which is what Do the Math is all about. It’s a trap! Spread the word! [4]

It would be far better, less stressful, and certainly a more optimistic approach if we could just forget any talk about Peak Oil (climate change, too) and proceed to a return to full “prosperity” and near-unlimited growth prospects just as soon as we possibly can. Doing so would require that we embrace the most wildly-exuberant statements about our “massive” and “vast” domestic supplies of shale oil, Canadian tar sands, and the gazillion barrels of oil shale just waiting to be plucked from beneath the surface. We could also learn to flap our arms at the right angle and speed and thus learn to fly.

Those two options are unfortunately required to abide by the rules of reality, and reality tells us neither is a viable option.

[Of course, as was reported by Kate Sheppard here, we could just emulate what a number of nitwit North Carolina legislators are attempting to do by essentially declaring sea level rises to be against the law: we could pass our own legislation mandating that any and all vastly massive resources/reserves/supplies be extractable immediately, inexpensively, and easily … or else!]

Facts continue to annoy, ruining all the “good” reasons arguing against the validity of Peak Oil (as if there weren’t enough already.)

The hard truth is that there are no good fuel substitutes anymore. Throughout human history, we have always been able to find not just a substitute fuel, but a better one: a cheaper, denser, more abundant one. That is simply no longer the case. One may hope for some miraculous technological breakthrough, and one may simply have faith that the invisible hand will solve our problems, but such thin threads are hardly a reasonable basis for policymaking and forecasting. [5]

We assume that the next 50 years will be like the last 50 in terms of energy availability, when the data clearly show that it will not. We assume that if oil runs short, we’ll find a substitute, not comprehending that the substitutes have much poorer quality, far lower production rates, and lower energy content. We assume that societal surpluses, like health care, or one person per car, or a complex society sporting ten times the retail space per capita of Europe, are normal. They are not. They are artifacts of an age when energy was insanely cheap. [6]

Yes, the Bakken could produce as much as 2 million barrels per day (bpd) up from roughly 500 thousand bpd, maybe as much as 3 million bpd, but the US imports roughly 8 million bpd today under even severe economic conditions, and as much as 10 million bpd under happier economic conditions.
The Bakken and other shale plays are simply not going to replace all of that — ever. Note, too, the slope of the line before the ‘Bakken bump,’ and observe that whatever gains are realized from shale oil will be fighting depletion losses from the rest of the tired fields under production. [7]

It turns out, however, that what most environmentalists know about the future supply of natural gas and other fossil fuels is based more on industry hype than on actual data….: There is increasing evidence that no fossil fuel will continue to see its rate of production climb significantly in the decades ahead and so none of them is a viable ‘bridge fuel,’ not natural gas, not oil, not coal. This means that global society must leap over fossil fuels and move directly to renewables as quickly as possible. In advanced economies this leap must be combined with a program of radical reductions in energy use, reductions which are achievable using known technologies and practices….
When the petroleum glut long predicted by the optimists failed to appear, they started lumping in ethanol, biodiesel and natural gas liquids with petroleum and calling them all ‘oil.’ These other products are useful, but they are not as energy-rich, versatile or easily transported as oil. Our current infrastructure is heavily dependent on oil inputs with no real substitutes available in the quantities required….
The hydrocarbons locked in the tar sands and the Orinoco oil belt in Venezuela aren’t what we call oil and must be heavily processed at high cost using enormous amounts of energy. As for the oil shale in the America West, the amount of commercially produced oil we are currently getting from that oil shale is zero. No one has figured out how to extract it profitably. Partly this is because oil shale contains no oil. Instead, it contains a hydrocarbon-rich waxy substance called kerogen which must be heavily processed to turn it into oil….
The hard-to-get oil resources are large, but they take a long time to develop and require strenuous, expensive and energy-intensive methods to extract. All this, when combined with the relentless depletion of existing fields, spells little or no growth in the worldwide rate of oil production in the coming years…..[8]

It would appear that we have what some might consider to be a “predicament”. Others might prefer a more basic “Oh, Sh*t!”

Pretending these factors don’t exist, aren’t relevant, or can simply be set aside by some combination of free-market wonders, the Technology Fairy, and good ol’-fashioned human ingenuity has a very tiny place in the important conversations we all need to start engaging in.

However we transition our society, lifestyles, industry, and transportation (for starters) away from the inexorable decline of crude oil supply and the inadequate replacement of same by renewables and/or shale-tar sand substitutes, the time factor, complexity, and disruptions to our preferred Business-As-Usual approach is going to call for a much greater level of serious debate with and contribution from … everyone.

We can make it worse by pretending and/or ignoring and/or doing nothing until there’s a “better time” for experts to take care of this for us. That is an option. It sucks, but it’s an option.

More information—admittedly—unpleasant, is better than not knowing. Football and hockey players in particular will tell you that being blind-sided is never fun. It’s no different when discussing our future and our future well-being.

I’ll have some more thoughts, along with observations from others, as this series continues.


[1]; Dangerous Ideas by Chris Martenson – 02.22.12
[2]; Fuel to Burn: Now What? by JAD MOOED – 04.10.12
[3]; A Substantial Failure’ Of Energy Education by Jesse Parent – 03.23.12
[4]; The Energy Trap by Tom Murphy – 10.18.11
[5]; Our energy future: Golden Age or Stone Age? by Chris Nelder – 10.26.11
[6]; When should we pursue energy transition? by Chris Nelder – 11.02.11
[7] Chris Martenson
[8]; Fossil Fuels vs. Renewables: The Key Argument That Environmentalists are Missing by Kurt Cobb – 01.23.12

Whether or not Peak Oil is true cannot possibly be in doubt. Within anything other than a geological frame of time, oil is a finite substance. When it is burned, it is gone. Without stretching our brains very far, it is easy to conclude that anything that is finite and consumed will someday be gone.
Peak Oil, then, is really an observation, not a theory. [1]

If only! What most four-year olds would agree is not much more than minimal common sense continues to confound some, who just cannot bring themselves to accepts facts and a reality contrary to a carefully-crafted storyline where facts are inconvenient at best.

The latest foray into the fact- and stats- and context-free world of denying the obvious comes here, courtesy of a Canadian economist (whose basic premise about the invalidity of Peak Oil seems tempered by the many troublesome production facts contained in her essay). What follows are assessments and observations she offered in leading to her conclusion:

[O]il production in the U.S. is surging….This new energy boom is the result of technological developments that have made the release of oil from shale rock not only feasible, but very profitable at oil prices around $100 or more a barrel….
Shale gas has been big energy news for several years as hydraulic fracturing has unlocked huge reserves of natural gas….
[N]ew fracking technologies and horizontal drilling has led to the biggest oil boom in many years….
The beneficiaries of this shale oil and gas boom are many and diversified both by region and by sector. With an estimated 3,000 new wells slated to be drilled in the next year, it is positive for job creation. Already, the depressed housing industry is stepping up production to house the growing number of oil workers and their families….
Combined with the increasing availability and low price of natural gas, rising domestic oil production is providing a boon to U.S. construction and industrial production. The price of land in these regions has skyrocketed and many small landowners have pocketed huge leasing windfalls….Demand for sand, used in the fracking process, has also surged …  sand mines are multiplying rapidly. Boom towns are sprouting up….Retailers, as well, benefit, as do bankers….
Manufacturing plants are returning to the U.S. to take advantage of cheap natural gas and relatively low unit labour costs, spurring major investments in petrochemical and steel production….Households are also benefiting from lower bills for heating and electricity….There is a growing demand for gas-powered electricity….The U.S. trade balance is also supported by these developments.

And not one single statistic, fact, (or context) to substantiate any of this! I suppose it’s possible to be even more vague, but this is a pretty good effort as is. “[O]il production in the U.S. is surging;” “hydraulic fracturing has unlocked huge reserves;” “The beneficiaries of this shale oil and gas boom are many and diversified;” “the depressed housing industry is stepping up production to house the growing number of oil workers,” etc., etc., etc.


Lots and lots of Happy Talk—unquantifiable, context-free buzzwords from the official Denier’s Playbook—but what does any of that actually mean? How do we plan effectively, as we must, to add others to the ranks of “many and diversified beneficiaries”? [And just as a for-instance, how “many and diversified” are we talking about? Nine? Sixty-four? Three hundred and two? But hey, “demand for sand” is surging, and all of this “is positive for job creation”!]

And all of that fact-free Happy Talk apparently leads quite obviously to this conclusion: “This unexpected boom in oil supply puts to rest the so-called ‘Peak Oil’ debate, where adherents to this theory argued that the supply of oil is fixed and dwindling, as traditional oil wells dry up.” Yikes!

[As for the one-pseudo-factual comment above, the: “estimated 3,000 new wells slated to be drilled in the next year”, Chris Martenson offers this sobering fact: “Typical wells in the Bakken come in at an average 200 barrels of oil per day and decline about 70-75 per cent in the first year before flattening out at 30-40 barrels per day.”]

An inconvenient reminder or two: the U.S. currently uses somewhere in the neighborhood of 18 million barrels of oil each and every day; our own production is currently in the neighborhood of 50%-60% of the peak we last touched more than forty years ago; and depending on the source one relies upon, we still import 8 – 10 million barrels per day despite these magnificent efforts in the Bakken and elsewhere; (and by the way, conventional oil fields are being depleted day after day, so getting back to “even” must happen first before we can start counting on unconventional, inferior quality, more-expensive-to-produce oil from the tar sands and shale). Facts suck!

Empty pronouncements aren’t especially helpful to the tens of millions who don’t have access to the facts and the realities of energy supply and production. How is this tactic helpful to them? When the reality of Peak Oil intrudes on their happy lives, and it turns out that the “might possibly could potentially if only” promises turn out to be just as empty in practice as they are now in theory, what happens then?

In fact, we will become more vulnerable over the long run, because the renewed embrace of fossil fuels will induce us to postpone the inevitable transition to a postcarbon economy. Sooner or later, the economic, environmental and climate consequences of intensive fossil fuel use will force everyone on the planet to abandon reliance on these fuels in favor of climate-friendly renewables. This is not a matter of if but of when. The longer we wait, the more costly and traumatic the transition will be, and the greater the likelihood that our economy will fall behind those of other countries that undertake the transition sooner. By extending our dependence on fossil fuels, therefore, the current oil and gas revival is not an advantage but, as Obama said in 2008, a threat to national security. [2]

The Canadian economist then goes on to describe the reality that “infrastructure has not kept up with supply;”  “Getting the oil to the refineries is a problem and currently, refineries in the U.S. do not have the capacity to handle all of this oil;” and because “of the infrastructure problems, an increasing volume of crude oil is now transported by railway and tanker trucks, boosting employment and activity in these industries, but the costs are far higher than pipeline transport;” and then, of course “With this boom, there are a growing number of concerns. The environmental impacts, though uncertain, are troubling. Potential pollutants entering the air and water supply are of great concern. Drilling is disrupting communities, damaging roads, and increasing costs to local governments. Some are worried about the effect of drilling on earthquakes….In some regions, like parts of Texas, there are already water shortages exacerbated by the huge volumes of water needed for hydraulic fracking.”

Nope! Not seeing any problems there!

But, hey, as Bob Lutz was so helpful in pointing out, we have a “scenario of abundance” coming from the Bakken shale oil fields and Canadian tar sands. Not much in the way of explaining anything about production rates, depletion of existing fields, costs, quality, and assorted other nit-picking facts some of us rely on, but when you have a scenario of abundance, and “so much greasy, oily and gassy stuff under the surface, it seems” well … who needs facts, Right? Mr. Lutz, proud as well of his climate change-denying credentials, even relied on a “senior oil economist” in his assessment that “‘Peak Oil’ [is now] exposed as yet another Chicken-Little fallacy.”

Good to know! (And all of us fact-reliant Peak Oil proponents have been concerned all this time….Geez!)

Just when I was ready to join the reality-free world, Chris Martenson had to go and offer just a small dose of concern to those for whom reality [and the future] matters:

The only problem here is, what if that view of the future is wrong? Then what?

Worth the risk?


[1]; Dangerous Ideas by Chris Martenson – 02.22.12


Ten months ago, I offered this observation:

This is the reality: we’re NOT running out of oil, and we won’t for several more decades. But that is not the point and never is when discussing peak oil. Peak oil is about the rate of production, the quality of oil, the ease of access, refinement, availability, and affordability. Each of these production elements are now more challenging to meet, and is now happening when worldwide demand is ratcheting up. Finding fewer and smaller fields that consistently fail to keep up with depletion rates, producing less oil, often inferior in quality, more slowly, at greater expense, with much more effort required to satisfy increasing demand (just for starters) is not a recipe for success, profitability, and availability. And it’s not going to get any better. The steady march down the back slope of oil production is soon upon us, and very little that we produce, use, or depend on will remain unaffected by that truth.

Reality can be incredibly inconvenient, but we do ourselves no favors now, short-term, and especially long-term by either falling for the fact-free, feel-good nonsense offered by too many; deluding ourselves into thinking “someone else” is working on this and so we need not be concerned; or perhaps worst of all: simply refusing to educate ourselves about what we’ll soon enough be facing.

With that in mind, I thought it might be best to offer up some inconvenient truths about our fossil fuel supplies we would all do well to keep in mind. How we respond to the realities at hand is absolutely critical to the different future we’ll find ourselves in before too long. Preparation is a good thing; knowledge even better.

A little more than a year ago, Jeffrey Rubin offered commentary on the International Energy Agency’s then-current World Energy Outlook. His sobering take:

Output from currently producing fields is projected to fall precipitously, looking ironically like the steeply declining trajectory of peak oil’s Hubbert curve. (I say ironically because the IEA has historically denied the existence of peak oil.) According to the report, by 2035 three quarters of currently operating oil fields won’t be producing anymore. In fact, current fields are only expected to account for less than one fifth of that     year’s production.
That leaves over 80 per cent of the IEA’s 2035 production projection coming from new oil fields, ones that either haven’t yet been developed or haven’t even been discovered. And the contribution from that undiscovered category alone is still far greater than the one from currently producing fields. That’s a tall order for new field discovery. especially since almost none of it is cheap or easy….

Take that in for a moment. Those projections offer comfort about the future availability of high-quality crude oil only if Major Denial is your standard MO and/or happy, fact-free optimism is your preferred glide path through life.

With all indicators suggesting that we reached Peak Oil production rates more than five years ago (see this as just one observation on the issue), how we pull ourselves out of these difficult economic conditions and restore ourselves onto the path of continuing growth (along with those same expectations from several billion other inhabitants on the planet) demands some consideration from all of us.

If that didn’t get your attention, how about this:

In the 2011 World Energy Outlook by the IEA the Production of Crude Oil from the oil fields that produce oil in 2010 in expected to drop by over Two-Thirds by 2035. Quote: ‘We project that crude oil production from fields that were producing in 2010 will drop from 69mb/to 22mb/d by 2025 – a fall of over two-thirds’. But the IEA still expects the crude world production to remain at 67,9 mb/d per day 2035 from Crude Oil Yet to be found and Yet to be developed (WEO 2011: 122-123)….
The World’s Largest Oil Fields play a very important part for supplying the world’s energy demand. The Top Ten Fields produced 14,26 mb/d; around 20% of the World’s Total Oil Production. If the next ten fields were added the figure was around 25%. In total there was around 70.000 Oil Fields producing oil in 2007 and 20 of these fields produced a fifth of all the oil (WEO 2008: 225-226).
Another fact also stands out very clear; none of these fields has been discovered recently; the ones that was discovered the latest was discovered in 1982 and 1985. Only two of these fields hadn’t reached their Peak in production in 2007; the rest where on decline. During the summer of 2011 there were big headlines concerning an unusually big oil find outside the coast of Norway that is expected being able to produce up to 500-1200 million barrels of oil. Ghawar with its production of 5 million barrels of oil per day produces this amount of oil in 100-210 days. The trends of smaller and smaller findings are something often stressed by researchers within the Peak Oil movement; smaller and smaller fields of oil are being discovered even though the technological tool available to search for new fields constantly develops. [1]

This author’s conclusion states an obvious and painful truth: “[W]e will either have to be very lucky in our explorations or find an enormous amount of small fields.”

Despite putting their best foot forward, those in denial about Peak Oil, who laud the potentials of the tar sands and shale oil (and even those advocating the very necessary focus on alternative sources of non-fossil fuel resources) are unable to come up with any scenarios where production of these unconventional and alternative reserves make up what will be lost over these next few decades from the conventional oil fields we’ve long depended upon.

Denial remains an option, but its utility diminishes by the day. We need to be better.

If subtlety is not your thing, Henry Blodget offers us a more direct assessment:

Oil is at $100 not because of some world war or supply shock or other Black Swan, but because the world’s emerging economies are demanding more oil while the world’s oil producers are producing pretty much the same amount of it….
We’re highly dependent on a finite fuel source controlled by crazy people who hate us
We’ve done next to nothing about this problem for four decades
In some places, this inaction on our part would be referred to as insanity. Or at least gross stupidity.
In other places, it would just be called denial. [2]

And in a recent post by Brad Plumer, more sobering assessments were offered for those still struggling with facts and reality:

Most of the older, easier-to-drill oil fields appear to be running near full capacity, while newer supplies often prove costly and difficult to drill….
But here’s another way to look at it. As a chart from ExxonMobil’s new 2012 Outlook for Energy (via Gregor McDonald) shows, the vast bulk of our oil comes from those older, easier-to-drill fields, with more recently discovered supplies playing a smaller and smaller role:
As ExxonMobil details in its report more than 95 percent of today’s oil comes from fields discovered before 2000. About 75 percent comes from pre-1980 discoveries. While many massive, older fields can keep gushing for decades — Saudi Arabia’s Ghawar field, first tapped in 1951, still hums along at 5 million barrels per day — they seem to be dwindling overall. As Exxon’s chart shows, reserves discovered in the 1960s and before maxed out around 1980 (even as oil companies are trying to recover additional oil from older wells with better technology). What’s more, it seems to be getting tougher to squeeze oil out of newer finds. [3]

This is what confronts us: do we choose to spin it so it sounds better, or do we accept it and then work collectively to meet the challenge?

Simple choice … monumental ramifications.


[1]; Peak Oil and Our Mental Models – The WikiLeaks Cable and The Worlds Largest Oil Fields, from – 12.15.11
[2]; It’s 2012–It’s Just Absurd That We’re Still Addicted To Middle-Eastern Oil by Henry Blodget, 12.28.11
[3]; Oil’s getting harder and harder to come by – Brad Plumer, 12.13.11

What would the New Year be if we didn’t have an offering of more half-truth, delusional nonsense about our fossil fuel status?

Amy Myers Jaffe (nice takedown here) wrote an article for Foreign Policy a while back, serving up another example from the playbook of denial nonsense. As I suggested in a series of posts at the end of 2011 [first one here], it’s high time we start recognizing the strategies of half-truths employed by those whose primary vested interest appears to be their own wallets much more so than the well-being of our nation. But this is a free country, and if nonsense is what you choose to spout, there are forums everywhere.

Just a sampling from that article of what continues to pass for the valuable exchange of information, with my commentary in the [ ] following:

Geologists have long known that the Americas are home to plentiful hydrocarbons trapped in hard-to-reach offshore deposits, on-land shale rock, oil sands, and heavy oil formations….The problem was always how to unlock them economically.
But since the early 2000s, the energy industry has largely solved that problem. With the help of horizontal drilling and other innovations, shale gas production in the United States has skyrocketed from virtually nothing to 15 to 20 percent of the U.S. natural gas supply in less than a decade. By 2040, it could account for more than half of it.

[Facts—damn them!—suggest that the energy industry hasn’t exactly “solved” the problem, and “could account” is not the assurance we should be counting on. Chris Nelder—damn him—took this proposition apart in a very nice post. Nelder had the audacity to use facts, calculations, statistics, reports and assorted other so-called evidence to rebut this now-familiar claim about our natural gas potential, when he could have played by the same rules and tossed in a few “might possibly’s” and “if only’s” … but no, he had to use actual information. I hate that!]

… analysts are predicting production of as much as 1.5 million barrels a day in the next few years from resources beneath the Great Plains and Texas alone — the equivalent of 8 percent of current U.S. oil consumption. The development raises the question of what else the U.S. energy industry might accomplish if prices remain high and technology continues to advance. Rising recovery rates from old wells, for example, could also stem previous declines. On top of all this, analysts expect an additional 1 to 2 million barrels a day from the Gulf of Mexico now that drilling is resuming. Peak oil? Not anytime soon.

[A couple of questions come to mind: Which analysts? Using what evidence? “predicting … as much as” means what, exactly? As for “what else the U.S. energy industry might accomplish if prices remain high and technology continues to advance”: I believe that “if prices remain high” is good for oil company executives and … that’s about it. So that’s not necessarily a good thing for most of us, but if “technology continues to advance”, why then, we might perhaps possibly have some potential good news in the future. Fantastic!]

The picture elsewhere in the Americas is similarly promising. Brazil is believed to have the capacity to pump 2 million barrels a day from “pre-salt” deepwater resources, deposits of crude found more than a mile below the surface of the Atlantic Ocean that until the last couple of years were technologically inaccessible. Similar gains are to be had in Canadian oil sands, where petroleum is extracted from tarry sediment in open     pits. And production of perhaps 3 million to 7 million barrels a day more is possible if U.S. in situ heavy oil, or kerogen, can be produced commercially, a process that involves heating rock to allow the oil contained within it to be pumped out in a liquid form. There is no question that such developments face environmental hurdles. But industry is starting to see that it must find ways to get over them, investing in nontoxic drilling fluids, less-invasive hydraulic-fracturing techniques, and new water-recycling processes, among other technologies, in hopes of shrinking the environmental impact of drilling. And like the U.S. oil industry, oil-thirsty China has also recognized the energy potential of the Americas, investing billions in Canada, the United States, and Latin America.

[Where in our planning for the future should we put “similarly promising”? As regards the second sentence about Brazil, who is doing this “believing” about that nation’s capacity? When might this happen? I didn’t note anything about the actual costs or process of extracting this crude “more than a mile below the surface” of the ocean … I’m assuming some facts might be available to instruct us as to what’s involved and what we     can expect? This nonsense—emphasis mine—speaks for itself: “And production of perhaps 3 million to 7 million barrels a day more is possible if U.S. in situ heavy oil, or kerogen, can be produced commercially, a process that involves heating rock to allow the oil contained within it to be pumped out in a liquid form.” Perhaps it’s possible if? This is the basis for the happy-talk about our fossil fuels? Seriously? I didn’t happen to catch any details about what’s involved in “heating rock.”     The facts would spoil all that optimism, and God forbid we be obliged to deal with reality….And that kerogen deal: they’ve been trying for a few decades now….]

And then there’s this bit of almost-factual opinion from Robert Bradley, touting his very own Institute for Energy Research’s report on our energy “inventory.”

The first red flag is right there in the title of his Forbes piece: “America’s Massive Energy Potential Awaits, Mr. President

As I noted in that above-referenced November 15 post of mine, “massive” and “vast” are straight from Page One of the right-wing handbook on misdirection and half-truths: use impressive (but unquantifiable) terms to bolster your claim … and hope readers aren’t curious enough to ask how much?

The real problem is that much of our resources are not being developed because of antiquated, heavy-handed government regulations. As a consequence, the American economy is being deprived of significant job creation and new investments….
The blame rests largely on unnecessary and onerous government regulations. Many offshore reserves are still blocked by outdated moratoriums no one is taking the time to reform. New permit applications are almost always subject to massive bureaucratic delays. Existing energy operations have to navigate labyrinthine — and costly — regulations. And regulators themselves are largely free to impose new controls on energy development with little to no congressional check.

This tiresome rant from the Right just isn’t adding much to the discussion any more. It’s a great red-meat sound bite, but devoid of any factual content, its benefits to our well-being are, well, non-existent. (But if you use “liberal”, “taxes,” and “regulations” in a sentence, you earn bonus points!)

Why are these regulations “unnecessary”? What “massive bureaucratic delays” (unique to this issue) and “labyrinthine [sure sounds awful!] — and costly — regulations” are involved? What might happen absent these socialist-liberal-Martian-tax-crazed regulations? “[R]egulators themselves are largely free to impose new controls on energy development with little to no congressional check.” Sounds awful! How about a “for instance” unique to this situation (with context, of course, which I realize violates a basic rule of the playbook)?

Seriously? “Regulations” are all that stand in the way of a limitless bonanza of energy resources for us? These johnny-one-note offerings suggest nothing more than a failure of both imagination and willingness to engage in meaningful and honest conversations.

I remain at a loss to understand why so many insist on tactics like these which have almost no relevance to legitimate, long-term solutions. Sure would be nice to toss some integrity into the mix now and then.

The author then offers this impressive-sounding collection of statements:

Total recoverable oil in North America exceeds 1.7 trillion barrels, which is more oil than the entire world has used over the last 150 years. And that amount alone could meet the energy needs of the United States for the next 250 years.
An estimated 1.4 trillion of those barrels are buried under American soil. For some perspective: the total proven reserves in Saudi Arabia is just about 260 billion barrels.
And even that 1.4 trillion figure might be an underestimation. Future technological innovation may well lead to improved detection techniques, helping us locate oil deposits currently uncovered. Or innovation could improve extraction techniques, enabling us to tap into reserves previously thought unreachable.

I can’t help myself [my emphasis]: “Future technological innovation may well lead to improved detection techniques, helping us locate oil deposits currently uncovered. Or innovation could improve extraction techniques….” Really? More Page One happy talk about all of the “could possibly perhaps” and “just might if” justifications (I use that term loosely). When do we declare a winner in the Happy Talk v. Facts competition?

I don’t recall seeing much in the way of an explanation or facts about all of these magical totals. Costs? Quality? Environmental concerns? Time factor? Return on energy investment? How about depletion from existing fields as a factor?

Robert Rapier offered a damning rebuttal to this author’s propositions, starting with a big hint in the title of his piece: Why Some Republican are Delusional About Oil and Energy Policy. (To be fair, he also offers criticisms of some of the positions offered by Democrats, and commends each party as well for certain other approaches.)

Like Mr. Nelder above, Mr. Rapier wasn’t content to just toss out a fact-free statement and end the discussion there. No, he had to go and conduct an investigation, and then analyze the facts offered above. Damn him! (Another hint Rapier offers comes from a sub-heading discussing the very same report prepared and cited by Robert Bradley: “Misleading Study Obfuscates Recoverable Reserves.”)

Rapier begins his analysis with this: “I find these sorts of reports highly misleading, for the following reason” and then quickly dismantles Mr. Bradley’s contentions in the next few paragraphs.

He then concludes:

The truth is that it will always take too much energy to produce some of those oil resources, placing some of them forever out of reach. But, the magical thinking from many Republicans here is that the oil is there if the political will is there for taking it. The danger in this kind of thinking is exactly the same as the danger in thinking we can smoothly transition to renewables: It diminishes the urgency of our energy predicament. After all, if people believe that renewables will save us, or that more drilling will save us — we are going to put off making the tough decisions that could really save us in the long run.

All of us—conservatives, liberals, whatevers—would do well to heed his advice.


I’m well aware that there is an unfortunately successful and all-too-often-employed strategy (lack of integrity aside) used most often in politics but certainly in discussions about Peak Oil and global warming, where the frequent repetition of any combination of lies, half-truths, misstatements, misrepresentations, and disingenuous propositions eventually leads to belief on the part of far too many people.

I’ve mentioned in prior posts (here and here, for example) that I think it’s important to challenge widely-disseminated examples of peak oil denial rather than letting the disingenuous arguments take root. The decline in oil production is a big enough problem as it is; creating doubt for reasons having no discernible value is at best questionable and should not go unchallenged is possible.

To that end, I came across two articles last week that caught my attention. Predictably, the same patterns of “explanations” and offerings cropped up there just as they have in other articles I’ve highlighted before. I guess if you cannot deal with facts, there’s not a whole of room for much creativity when addressing fossil fuel production. I’ll deal with the first article today, and save my discussion for the other one for an upcoming post.

First up is a piece from Jeremy Bowden, whose first paragraph touts one of the more popular terms in denial-land: the finding of “massive” oil fields. Whenever I read that, the antenna goes up and into full lock mode. Usually accompanying glowing exhortations about these magical fields where solutions to all our problems reside are phrases touting the wonder of technology and ingenuity. Bowden does not disappoint.

This article of necessity raises the specter of OPEC’s role in world production: “It is the technical expertise and project management skills of the most dynamic multinational and independent oil companies that hold the key to these new hard-to-get-at reserves, rather than the whims of Arab dictators or the level of OPEC budget deficits.” Always good to have an enemy to whip out at a moment’s notice (not that I’m an OPEC fan, mind you.)

I’m still not entirely clear on why quotes like this are supposed to be persuasive, but they do frequent writings which dispute peak oil:

“James Burkhard, a managing director at energy consultancy IHS CERA, says the recent upstream developments mean oil and gas will continue to be pillars of global energy supply for decades to come. ‘The competitiveness of oil and gas and the scale at which they are produced mean that there are no readily available substitutes in either one year or 20 years,’ he added.”

He’s absolutely correct. There are no readily available substitutes, but that’s the problem! Saying that oil is currently our one and only is not even a bit helpful. All it does is to emphasize how utterly dependent we are on this finite resource—a resource that by all reasonable indications peaked several years ago and will continue a steady path along a not-always smooth or linear slope of decline … and we are woefully unprepared. (This recent post is only the latest in a lengthy list of concise and easily-understood explanations about Peak Oil.)

So what comfort does it offer us to indicate that all we have is all we have, when more of it is being demanded and less of it is being produced?! That math just doesn’t work.

Bowden also points out that Canadian oil sands now provide us with more oil that does Saudi Arabia. And….?

Saudi supply is being counted out by many other nations whose fossil fuel demands are only increasing; Saudi production is also being increasingly diverted to and for its own uses, and its fields are not immune to the same rates of depletion as are most other older fields, so … what’s the point here? Like most other articles which promote Canadian tar sands as the Great Salvation, no mention whatsoever is made here of the environmental degradation; the poisonous tailing ponds left behind; the immense demands on water; the costs, effort, and/or time involved in extraction, or the fact that production rates aren’t all that spectacular to begin with!

But why deal with any of those facts? They simply get in the way of a good insincere argument. (And Bowden also makes it a point of stating that U.S. oil production increased “for the first time in decades.” Our production peaked more than forty years ago! A slight one year uptick—from shale, which has its own set of environmental, cost, effort, and resource usage issues, also conveniently overlooked—is not exactly encouraging.)

Speaking of U.S. shale production, Bowden points out the following:

“… the Bakken shale field is now the country’s fastest-growing major oil field. Production has reached about 350,000bpd, from 100,000bpd a decade ago. In a recent report, consultancy firm PFC Energy projected production would climb to 450,000bpd by 2013. ‘The technology producing these resources has absolutely made the difference,’ Mr Marvin E Odum, President of Shell Oil, said. ‘It’s the same with the Arctic, with the shale oil, all over the world. Technology is the key.’”

Give or take a bit, the United States uses somewhere in the neighborhood of 7 billion barrels of oil per year … billion with a “b”. I’m definitely not a math whiz, but my trusty calculator tells me that 450,000 barrels per day times 365 days equals an impressive-sounding (approximate) 165 million barrels per year. I’m pretty certain that 165 million is a whole lot less than 7 billion. Rounding up to the approximate 20 million barrels of oil this nation uses each day, that means we’ll soon be producing enough to get us through sometime next week! Fantastic!

Another forty or so examples like that and we’re all set (and to hell with the rest of the world and their needs or demands).

This author also made it a point of using the same vague, subject-to-multiple-interpretations stock language others employ is discussing the magic of potential future technology, including this:

“A recent forecast produced by Shell suggests that Arctic production from North America, Europe, and western Russia – much of which will be deep offshore – could make up a quarter of global production within 20 years, provided that remaining technical, political and environmental challenges are met.” [My emphasis]

“… provided that remaining technical, political and environmental challenges are met”? Seriously? That’s what we’re supposed to derive great—or any—comfort from? And within 20 years? Wow! That’s not asking for too much, is it? A few pesky “technical, political and environmental challenges” met and we’re good to go!

And there’s this:

“Advances in directional drilling allow well operators to steer and carve through hard shale to expose more and hard-to-reach rock, and it also makes possible drilling under cities or into environmentally-sensitive areas….
“Faced with falling reserves and barred from acquiring fresh production in areas such as the Middle East, [nice to just skip past this – my comment] international oil majors began to search for new large deposits in the deep waters of the Gulf of Mexico….Exploration and drilling below 10,000ft of water and through miles of hard rock, thick salt and tightly-packed sands required the development of supercomputers and three-dimensional imaging techniques as well as equipment that could withstand the heat and pressures common at such depths, not to mention submarine robots to make repairs.”

Others have also pointed out these types of impressive displays of innovation and truly astounding technology. But why is this a good thing? That anyone has to go to these lengths and expenses and risks to find oil shouldn’t require any advanced technical degrees to understand that we’ve got some problems!

It would be nice if even some of the energy and effort expended in trying to prop up the dismal truths of oil production could instead be directed to conveying a more accurate and complete picture of what we face now and will have no choice but to deal with in the years to come. That might be a bit more helpful.

There’s always hope….

In a recent post (here), I discussed the unfortunate practice by Peak Oil dissenters of cherry-picking facts to suit their skewed perspectives on the reality of oil production, conveniently neglecting to provide readers with the relevant background information needed to properly understand the issue at hand. An equally discouraging exercise is their use of vague, impressive-sounding but ultimately meaningless words and phrases to try and bolster their side of the argument. Perhaps they count on apathy or ignorance on the part of their readers, but regardless of the rationale, it does little to help. (Why do they insist on doing this? The Boston Globe published an interesting piece on Sunday that may provide answers.)

A recent and particularly egregious example can be found here. Feel free to read this glowing exhortation about the bazillion years of oil we have at our beck and call via oil shale. The author of that snarky piece excels at long division, but note the complete failure to mention even a single fact as to what is actually required to produce the oil shale this writer so ardently touted. Why let the truth get in the way of nonsense? (Hard to be kind to this narrow-minded wing-nuttery, so this is the best I can do.)

Just for the heck of it, take a peek at these prior posts (here and here) offering information about what is involved in mining oil shale and how utterly ineffectual efforts have been for most of the past few decades.

Facts are indeed an annoying intrusion into the puzzling reality of some.

This past weekend I came across yet another article where the full range of information was conveniently omitted. When you write a piece like this offering up at best fuzzy details and are hoping/praying/counting on your readership being uninformed and thus reliant on whatever details you do or do not provide, I can only assume there is some benefit to be derived. Engaging in open and honest debate, however, would not appear to be on that list. If all the facts aren’t on the table, then what does that suggest about the argument being made?

“Resources in the ground are clearly abundant. Canadian Association of Petroleum Producers Vice President Greg Stringham, pointing to the 175 billion barrels recoverable from the Canadian oil sands, says, ‘It won’t be a lack of resources that causes a shift away from oil. There’s lots of oil.’ The United States Geological Survey recently updated their estimates for recoverable oil from Venezuela’s Orinoco Belt to 513 billion bbl. Compare this to BP’s estimate of some 1200 billion bbl of global conventional oil reserves. Some shale formations, such as the US’s Bakken and Eagle Ford, contain substantial amounts of oil and natural gas liquids too, a form of unconventional oil which has emerged from nowhere in the past few years.

“Traditional onshore light crude, though often inaccessible to the international oil companies, remains plentiful too.”

(My bold italics were added for emphasis)

I’ve already acknowledged, as have many other Peak Oil advocates, that there are indeed hundreds of billions of barrels of oil in the ground. We’re not running out of oil. Those are not facts in dispute, unless you are arguing whose estimates are correct. But as is frustratingly obvious yet again, this Oil Council article fails to make mention of a single fact about the difficulties, costs, environmental degradation, time factors, or energy expenditures incurred in producing these resources. Uninformed readers are left with the impression that a shovel and sturdy straw are pretty much all that’s needed to extract this “plentiful”, “clearly abundant” oil from underground. (How many barrels are in a “plentiful”?)


The simple truth is that there is a big difference between what’s in the ground and what’s feasible or even possible to get out of the ground (or in deep water). So just tossing out large numbers or unquantifiable phrases like “substantial amounts” without a corresponding explanation that these tidbits don’t necessarily mean that we can actually extract or produce them is misleading. I always find it very difficult to understand the purpose or intent of such efforts, and remain dismayed that the fear of engaging in honest debate trumps the importance and necessity of having that honest discussion, regardless of outcome. Aren’t we all better served when we can deal with full truths rather half-ones, painful though it may be? What is gained otherwise?

If facts are wrong—mine included—then they’re wrong, and we are all better off knowing that and moving forward with better information. I wish it could be that simple….

“Kuwait and Abu Dhabi recently updated ambitious plans for production gains.”

And…? They can “update” their “ambitious plans” until pigs fly, but what does any of that prove? That’s a solution?

Likewise, cornucopian arguments proffered by this article about the “technical potential” of Iraq’s oil fields are pointless! What’s involved in realizing this “technical potential”? How many years? How much money? What are the complex political factors to be addressed? What other resources will be needed? How much energy will have to be invested in order to extract all this potential? When all is said and done, how much production can realistically be expected?

(An aside: Andrew McKillop, writing on Sunday about the Gulf of Mexico oil spill, noted (here) that BP’s Macondo field, thought to contain somewhere in the vicinity of 300 million barrels of oil—three or four days’ worth, by the way—could realistically have been expected to extract no more than 50 million barrels, and over 15 years or more. These are the types of facts we need to be dealing with and explaining to others instead of pretending that all will be well because we still have “lots” of oil left.)

And touting the 21 billion barrels of oil Iran has produced in the past dozen years sounds terrific up until the moment you realize that’s about 7 months’ worth of supply. Probably want to hold off rushing out the door to buy that soon-to-be-extinct Hummer you’ve always dreamed of….

“Kazakhstan’s long-delayed Kashagan field will finally come onstream around 2013 and yield more than 1 million bbl per day.”

Pulling out my trusty calculator, I conclude that 1 million barrels per day times 365 days in a year means that the Kashagan field will yield about 365 million barrels per year, or … Gasp! almost five day’s worth of oil! Hallelujah! Our prayers have at last been answered! Wow, that was close! I thought we all might actually have to start giving up things and changing lifestyles, but oh, no! Just a handful of these producing oil fields could get us enough oil to last until … uh, uh, a few weeks.

These resources and finds are surely better than a stick in the eye, but really? This is what’s being touted as the answer to Peak Oil’s discouraging message and worrisome impact? Oil production is on the decline, and these feverish efforts to paint a rosy picture help no one prepare for and plan the changes societies will need to implement. Whatever transitions away from fossil fuels we can collectively fashion will carry their own hardships. Let’s not make it worse by avoidance.

I understand that no one really wants to have to deal with the problems and challenges of declining oil production. Sure as hell I don’t! There is nothing even remotely enjoyable to contemplate about the onset of Peak Oil and its impact on my own pleasant, suburban multi-car, two-home lifestyle. Millions and millions of others who understand the implications and consequences will be/are just as dismayed for their own reasons—selfish or otherwise.

Making do with less is not anyone’s idea of progress or pursuit of the great American Dream. I understand the instinct to avoid, deny, or just pretend otherwise. The problem is that those strategies are not only not going to work, they will ultimately make things worse for all of us. They may serve some weirdly narcissistic, narrow-minded short term interests, but we are all in this together—deniers, too. Their magical thinking won’t prevent Peak Oil from impacting their lifestyles and businesses. Unless you have managed to carve out a lifestyle entirely independent of fossil fuels, either by avoiding personal use of it or avoiding goods and services that require it, Peak Oil is going to affect you, and perhaps quite dramatically.

Let’s not wait until we’re all in full-fledged panic mode over what is happening when supply can no longer match demand. It’s not that far away … and much too soon for us to avoid all the nasty consequences Peak Oil is going to impose on us. Disingenuous “information” is thus not at all helpful unless perpetuating a lack of understanding and awareness are the objectives.

If this deliberate obfuscation of facts and the true import of Peak Oil’s impact is the best that the deniers can offer, doesn’t it contain at least a seed of suggestion that perhaps we all ought to be thinking a bit more seriously about what needs to be done? We’re years behind as it is. As painful as it will be to confront the possibilities of having to make do with less for many years to come, having some say in how we collectively prepare for and deal with the impact of declining oil production seems a better long-term option.

Relying on these half-baked missives of optimism is an exercise in foolishness none of us can afford

The potential of more than 2.5 trillion barrels of synthetic crude oil from oil shale is nothing short of fantastic! (Nearly two-thirds of that amount is located principally in the Bakken Formation of North Dakota, Montana and Saskatchewan; and the larger Green River Formation of Colorado, Wyoming and Utah.) With annual worldwide oil consumption of approximately 30 billion barrels of oil, it would seem that oil shale’s astonishing numbers drive yet another nail in the coffin of Peak Oil theory.

A couple of trillion barrels of oil from shale formations will hold us in good stead for more than a few lifetimes! (In a report issued several years ago, the RAND Corporation estimated that the Green River Formation alone could provide a quarter of this country’s current oil needs for 400 years! Amazing! [1]) It’s every bit as awe-inspiring a number as are the potential tar sands resources in Alberta.

Of course, there are two sides to every story, and like the tar sands of Alberta, there’s an enormous gap between what may rest beneath the ground and what we’ll be able to extract, refine, and eventually use over the course of many, many decades. Like its unconventional oil companion to the north, oil shale is not likely to be the solution to our energy concerns in the next several decades. If it ever is, it may be too late in any event.

Geologists and the United States Geological Survey estimate there are approximately 4.3 billion barrels of technologically recoverable oil in the Bakken region. We may possess the capabilities of extracting that much oil, but the costs going in and the consequences of attempting to extract and produce oil from shale are different matters entirely, so what may be “technologically recoverable” is by no means the same as “economically feasible.” And let’s also take note that 4.3 billion barrels of oil is about 7 or 8 months’ worth of oil consumption here in America, and the best hope is that all of that would be extracted over the course of no more than twenty years. Not particularly impressive.

The other formations appear to hold not much more promise, although the more optimistic estimates suggest we might see as much as 130 billion barrels of oil from them … eventually. (One expert directly involved with Shell Oil’s production efforts suggested back in 2005 that by 2030 we might see 5 million barrels per day from the formations out West. [2] Five million bpd doesn’t mean all that much now; it will mean much less a couple of decades into the future.)

Oil shale is, as acclaimed energy expert Chris Nelder has stated: “the oil of the future … and it always will be.”

The truth is that after nearly fifty years of attempts to develop oil shale into a satisfactory oil substitute, only a few hundred million barrels of oil have been produced, if that. In other words, we’ve probably managed to supply about a week’s worth of worldwide oil demand as a result of all that effort and money over nearly half a century. Trillions of barrels of oil! stops sounding so impressive when reality intrudes.

A recent and significant increase in production (see a detailed explanation here: Bakken Shale – Has it Moved the Oil Needle? by Gail the Actuary, November 2, 2009) does not change the basic fact that no company has yet made the full-scale commercial production of oil shale economically feasible—with no guarantees that we’ll ever see that outcome. The research and testing of commercial capabilities are not adequate to the task after decades of effort, nor do we have in place the proper facilities that would be needed to handle production demands. They won’t pop out of the ground fully-formed any time soon.

Best estimates are that establishing those essential commercial components is at least another decade away. By then we’ll be well on our way to decreasing supply trying to match increasing demand. That’s bad math.

Part of the reason is that like tar sands, oil shale is not easily extracted. Oil shale is not oil. It’s kerogen, a solid, not-yet-fully matured version of the fossil fuel. More specifically, it’s the organic matter within the oil shale, and in order for the oil to flow free of the shale and be pumped to the surface, it must be heated to more than 700 degrees for a couple of years (while surrounded by a three-foot wall of ice)! This is the “in situ” procedure. The other primary means of obtaining kerogen (usually buried thousands of feet below ground, by the way) is the “retorting” procedure: mining the oil shale and then heating the kerogen above-ground.

Either option represents the investment of a LOT of energy. It’s also important to appreciate that oil derived from kerogen requires further refining before it can be used for transportation purposes … more effort and expense after extraction.

And I won’t touch on the significant amounts of water required to help extract oil shale (and in regions of this country where water is a limited resource to begin with) nor am I discussing in this post the environmental degradation and pollution that results from mining this resource. I also omit any discussion about the impact of such massive undertakings on the local communities involved. I can omit discussion here, but we cannot ignore those considerations.

These pesky little details seem to get overlooked by those who dispute Peak Oil’s imminent approach.

At what point do we decide that the tens and hundreds of billions of dollars we seemingly have at the ready to invest in oil-related energy exploration and production ought to be devoted to resources not quite so limiting? Like the oil from tar sands, oil from oil shale is not anywhere near as productive or efficient an energy source as conventional crude oil … not even close, actually.

We’re just postponing the inevitable, and it seems we should be seriously considering alternatives (not that they are a panacea, either, since we need a lot of oil to research, extract, produce, process, and transport almost every other form of energy). They will at the very least represent a much better long-term solution than oil, shale, and tar. How difficult do we want to make the transition away from oil-based energy?

We have some choices to consider….

Next: Shifting Gears


[1] Oil Shale Development in the United States: Prospects and Policy Issues by James T. Bartis, Tom LaTourrette, Lloyd Dixon, D.J. Peterson, Gary Cecchine; Copyright 2005 RAND Corporation, Santa Monica, CA