Peak Oil Matters

[NOTE: Back in April, I followed-up on a series of posts which I first began nearly a year ago and last discussed back in April ([links below*). In that series, I’ve discussed the apparently limitless ability of too many to either ignore facts about oil production entirely, or who instead resort to efforts where disingenuous arguments and/or half-truths serve as sole support for their positions. The net effect is that these attempts do little more than confuse their followers, who likely do not have the time, interest, or inclination to explore the truths on their own (perfectly understandable ... life tends to interfere with lots of options). This post is another follow-up.]

Another in a seeming endless list of far-Right websites recently posted their own take on what the writers called the “farce” of Peak Oil. That they later cheerfully admitted to being believers of the wacky notion of “abiotic oil” (the long-ago discredited notion offered by Russians some fifty plus years ago and heralded by apparently one academic here in the U.S. that oil essentially replenishes itself underground—perhaps via the Petroleum Fairy) is in and of itself the only reason needed to place them in the “loon” category of deniers.

Nonetheless, I found another example of the Right’s also seemingly endless capacity to twist facts into some delusional substantiation of the nuttiest perspectives, one which they no doubt hope readers will not contemplate at all. This website recently offered their take on an article by a Venezuela-based New York Times journalist—the paper’s Andean bureau chief. Raymond Learsy from the Huffington Post—whose opinion pieces will never find their way into the “open-minded” indices—not only echoed those same claims, but introduced us to the concept of “an amplitude of oil” … much more impressive than the increasingly boring “vast” or “massive” quantities, doncha think?

For reasons entirely unclear, the opinions offered were premised on the inane and entirely fact-free determination that the publication of this single article about oil exploration and production represented a dramatic reversal of “editorial policy” on the part of the Times, which has now apparently joined the club of Peak Oil deniers by virtue of this one article. Somehow, the discussion of efforts being undertaken in South America morphed into a final debunking of the “farce” of Peak Oil by a full leap into nonsense—while attributing an incredible amount of journalistic power to a gentleman in Caracas. Cool, huh? “Well, gee, if the Times is now disputing Peak Oil, then of course….” Nice try!

That the article made no attempt to debunk Peak Oil does not matter in a world where facts are only useful when convenient to an otherwise entirely dumb argument. Apparently, the mere fact that exploration is taking place is in and of itself another sufficient reason to completely discredit Peak Oil. This approach does simplify the entire concept of thinking!

Sad to sad, this is not a tactic unique to these two authors.

The Times article begins as follows, (as does the DailyBell piece):

“Brazil has begun building its first nuclear submarine to protect its vast, new offshore oil discoveries. Colombia’s oil  production is climbing so fast that it is closing in on Algeria’s and could hit Libya’s prewar levels in a few years. ExxonMobil is striking new deals in Argentina, which recently heralded its biggest oil discovery since the 1980s.”

A couple of questions jumped out at me as soon as I read that. What does it mean that Columbia “is closing in on” Algeria? Does spending an amplitude of money by “striking new deals” mean that Peak Oil is indeed a “farce?” Kinda think it proves no such thing. That oil companies are now spending so much more in so many more difficult to reach places suggests at a minimum an alternative, common sense explanation. Like basic math, facts, truth, reality, and science, however, this concept seems elusive still to too many. But if reasoned and fact-based opinion is not your thing, then that argument works!

Although facts can be so damned annoying when reality is not a concern, I nonetheless spent nearly thirty seconds on the internet to find the Energy Information Agency’s list of the top oil producers in the world. (Yes, I rested after locating an answer. Whew!)

Let me modify that introductory paragraph by inserting some [bracketed] facts and added bold/italic emphasis to lend some relevance to the article’s opening statements:

“Brazil has begun building its first nuclear submarine to protect its vast (there’s that word again!), new offshore oil discoveries. Colombia’s oil production [currently ranked 29^th in the world] is climbing so fast (Wow!) that it is closing in on (look out!) Algeria’s [ranked 15^th in the world at a whopping, vast, massive, amplitude-iful two whole million barrels of oil per day,  meaning that it could soon supply approximately 1/40^th of the world’s daily production ... pass out the smelling salts, Mildred!] and could hit Libya’s [# 17] prewar levels in a few years (which of course is easily quantified as maybe, possibly, potentially happening … uh, um, in a few years). ExxonMobil is striking new deals in Argentina [# 24], which recently heralded its biggest oil discovery since the 1980s [which, according to a Bloomberg article, is the equivalent of about 150 million barrels of shale oil ].”

Two comments on that last point. Shale oil is a wee bit different than your conventional, drill-a-hole-in-the-ground-and-out-it-comes oil. (See here and here, just for the hell of it—not the final and definitive take on shale exploration, but not to be ignored or dismissed, either.)

World production is somewhere around 85 million barrels of oil per day, so “about 150 million barrels” of an inferior substitute is in the neighborhood of not quite two entire days’ worth of annual production (“annual” is 365 days for those interested in facts. Two days is thus less than 365—if you use Planet Earth’s version of math—and by an amplitude of days.)

But if that’s not enough to convince you, the DailyBell also indicated that “One of the Forbes brothers (of magazine fame) was quoted some months ago as saying the US itself, even in the lower 48, might contain enough oil (not to mention coal and natural gas) to provide for its needs for the next 1,000 years. And that’s with the current technology.” Wow! One entire Forbes brother! Who needs proof when a Forbes brother (“of magazine fame” which is almost identical to being a petroleum expert), says we have enough fossil fuels to last a bazillion years?

Seriously? This is what passes for an intelligent contribution to our understanding of a not-easily-understood challenge everyone will be affected by (yes, even the far Right)? To what end? When do we reach Peak Nonsense?

Consistently missing from all of these supposed rebuttals to the validity of Peak Oil are two more of those pesky mathematical facts. First up: Oil fields deplete as oil is extracted. (I know! Amazing concept, isn’t it?) The consensus offered by those in the know suggest that the depletion rates of existing oil fields is anywhere from 4% to 7% per year. Ballpark, this means that any and all new discoveries must first produce about 4 – 5 million barrels of oil per day just to keep pace with depletion.

Another argument frequently advanced (as was the case in the Daniel Yergin Wall Street Journal article which prompted these posts) is that U.S. oil production has increased in recent years, from which we’re apparently expected to deduce as another refutation of Peak Oil. American production peaked four decades ago. That production has increased in the last couple of years (and not by any amplitude, by the way, although noteworthy nonetheless) should be understood in the appropriate, fact-based context. We’re nowhere near the production level which peaked some forty years ago. Good that more is being produced (although it should be noted that we’re not producing much more of the conventional oil … most of the increases are due to production of the more costly and difficult unconventional sources). Still have a long way to go….

Let’s say you were an unmarried single for a decade. From 1990 – 1999 you earned a bit more each and every year, topping out at $100,000 in 1999. Now we turn the corner into 2000, and you’re married! Unfortunately, your income has dropped to $60,000. Five years later, you’ve also got two new mouths to feed, a mortgage, a couple of car and credit card bills, and assorted other expenses unknown to you in the decade before. But let’s inject a ray of sunshine in this example and say that in the last five years, your income increased to $65,000 per year (but baby # 3 has arrived, along with a bigger mortgage and some unanticipated medical expenses tossed in for good measure). Problems solved? Income has increased, so what’s the beef? You’re making more recently than you did just a few years ago, so what exactly is your problem?

Peak oil is kinda like that in its simplest, simplest form.

I’ll let you ponder that. More still to come.

* http://peakoilmatters.com/2010/10/18/more-on-the-message/

http://peakoilmatters.com/2010/11/22/still-dealing-with-peak-oil-denying-nonsense/

http://peakoilmatters.com/2010/12/20/the-stubbornness-of-denial/

http://peakoilmatters.com/2011/02/03/the-never-ending-efforts-to-skate-past-the-facts-of-peak-oil/

http://peakoilmatters.com/2011/02/10/more-never-ending-efforts-to-skate-past-the-facts-of-peak-oil/

http://peakoilmatters.com/2011/04/27/even-more-never-ending-efforts-to-skate-past-the-facts-of-peak-oil/

http://peakoilmatters.com/2011/09/26/still-more-never-ending-efforts-to-skate-past-the-facts-of-peak-oil-pt-1/

Back in April, I followed-up on a series of posts which I first began nearly a year ago and last discussed back in April [links below*]. In that series, I’ve discussed the apparently limitless ability of too many to either ignore facts about oil production entirely, or who instead resort to efforts where disingenuous arguments and/or half-truths serve as sole support for their positions. The net effect is that these attempts do little more than confuse their followers who likely do not have the time, interest, or inclination to explore the truths on their own (perfectly understandable … life tends to interfere with lots of options).

I’ve yet to come up with a satisfactory explanation as to why some seem determined to make such misleading efforts their sole contribution to important discussions….

The blogosphere has been lit up in recent days by discussions pro and con regarding Daniel Yergin’s newest book, The Quest: Energy, Security, and the Remaking of the Modern World. (I have not read it, so please take my commentary in this series of posts with that caveat in mind.)

Needless to say, the Wall Street Journal, among other liberal bastions of enlightened, open-minded thinking, was more than willing recently to publish an opinion piece by Mr. Yergin based on his new book, touting some of his many, longstanding doubts about Peak Oil. Commentaries in support of and debunking his perspective have been around the Internet for years. This time around was no different.

Since I have not read the book, it would obviously be inappropriate of me to offer my opinions on anything Mr. Yergin. I’m more interested in the type of chatter that has been circulating since publication of that WSJ piece by others who are apparently in the same camp as Mr. Yergin. I’ll be devoting this and several other posts to some of the more noteworthy commentary and the inevitable nonsense.

The following are typical of the comments offered by Yergin’s fellow-cornucopians:

“If you’re a believer in ‘peak oil’—the idea that the world is on the verge of running out of oil—you will probably want to burn this book.” [1]

“The theory known as ‘peak oil’ has at its core the belief that we are rapidly running out of oil” [2]

The instant a criticism of Peak Oil and/or its proponents is prefaced by an assertion that Peak Oil proponents are claiming that “the world is running out of oil” meme, any credibility is lost. Repeating that nonsense makes it clear those authors do not understand even the most basic of issues regarding Peak Oil. The deniers are nonetheless quite determined in their insistence that we (who believe that Peak Oil is an imminent reality and great challenge to future prosperity) are always raising alarms that “the world is running out of oil.”

The problem is that anyone who has any working knowledge of the facts about Peak Oil and oil production in general never makes that claim! But again, why let facts get in the way of opinion?

I have repeatedly stated, as have others far more knowledgeable than me (Jeff Rubin, Kjell Aleklett, Richard Heinberg, among dozens of other leading lights) that the issue for us is not and has never been the notion that “the world is running out of oil.”

It’s not! We agree on that point.

There are indeed hundreds of billions of barrels of oil in various forms awaiting extraction and production. The tar sands of Alberta Canada and oil shale formations such as the Bakken here in the U.S. are among noteworthy examples. But in order to make their point (and thus calling into question the validity thereof, a separate point which apparently is lost on these deniers), they try to tar legitimate Peak Oil proponents with a bug-eyed premise we never argue in favor of!

Facts and the truth are convenient casualties in too many political and economic discussions as it is, so why should Peak Oil be any different? Sure would be nice if honesty and integrity mattered more than they do. Sigh….

“We are not running out of oil. The issue is not our endowment of oil resources, it is the world’s production capacity. [My emphasis]. Additions from exploration last replaced annual production in 1987. The easiest oil has been discovered. Costs are increasing for new barrels, where wells can be drilled in water depths of over one mile to targets up to six miles deep, and discoveries can take over a decade to develop.

“Oil field declines are running at more than 5 percent per year. That means we have to add at least 4 million barrels per day each year just to keep production flat.” [3]

Understandable that no one likes to hear that. But why is basic math subject to dispute? (Sorry! Forgot for a moment we have Republicans in Congress for whom math is not much more than a convenience.) Solutions are much more effective when you start with the facts at hand. Why is this such a difficult concept to embrace?

“One of the greatest of all American strengths is the willingness to examine national challenges remorselessly, in the confidence that only what is examined can be repaired.” [4]

Another tactic (as I’ve noted in the series of posts referenced above) is to use impressive-sounding but utterly meaningless buzz-words whose intent, the writers must believe, are to offer assurances to their readers that we nutty liberal tree-hugging socialist gay-loving atheist un-patriotic elites are just conspiring to … uh … take over the world. **

In the Rotman article quoted above, the author adds that there are [bold-face mine]“…vast quantities of ‘unconventional’ gas and oil….The examples are numerous: deep undersea oil reserves off the coast of Brazil where one field alone holds 5 billion to 8 billion barrels of recoverable oil; oil sands in Alberta that contain an estimated 175 billion barrels of recoverable oil and an estimated 1.8 trillion barrels of oil in the ground, waiting for future technology to get them out; another 20 billion barrels of ‘tight oil’ that is likely held in deposits scattered about the United States.”

How much is a “vast” quantity? Mr. Rotman states (which appears by most indications to be true) that one field in Brazil holds “5 billion to 8 billion barrels of recoverable oil.” But like so many others, attending facts either never make it into print alongside these bold statements of partial truth, or they are glossed over. Mr. Rotman notes that the Brazil find is in “deep undersea oil reserves off the coast.” Run that one again. “Deep undersea oil reserves off the coast.” Not exactly like digging a hole in the ground and watching a Jed Clampett-like gusher suddenly materialize….

No mention at all as to what’s involved in drilling, extracting, transporting, or producing this “deep undersea oil reserve off the coast.” No mention either of how much such an endeavor is likely to cost (hint: vast amounts of money), or how long it will take to actually bring that field to market (hint: a vast amount of time). But why explain anything when you can toss out unsupported statements which sound so much better without the facts? Oh, and by the way: “5 billion to 8 billion barrels of recoverable oil” is approximately two to four months’ worth of oil usage worldwide. Hallelujah!

How long should we plan on “waiting for future technology to get them out” (hint: a vast amount of time)? What’s involved? Has the innovation process begun? What are the guarantees of success? How much might that cost from idea to implementation (hint: vast amounts of money)? Who will pay? (hint: check your mirror). How efficient will these unconventional supplies be in comparison to Jed Clampett’s gushers? How much of the current supply of fossil fuels will be needed to provide the energy source for testing, trials, implementation, etc., etc., and where does the supply come from and at whose demand expense? What environmental and societal costs are to be incurred? And what happens in the interim while we’re waiting for this magic technology to materialize? Who is going to volunteer to tell us that we’re putting supply and demand on hold, while telling the Indias and Chinas of the world to just sit tight until we figure all of this out?

“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.

“Undeveloped or undiscovered oil fields, growth in tar sands production and increased reliance on natural gas liquids account for all the expected growth in world oil production over the next two and a half decades. Curiously absent from this list is any contribution from conventional oil production–you know, the type you can afford to burn in your car, the type the global economy can afford to use to power transoceanic trade?” [5]

The mind boggles….

To be continued.

* http://peakoilmatters.com/2010/10/18/more-on-the-message/

http://peakoilmatters.com/2010/11/22/still-dealing-with-peak-oil-denying-nonsense/

http://peakoilmatters.com/2010/12/20/the-stubbornness-of-denial/

http://peakoilmatters.com/2011/02/03/the-never-ending-efforts-to-skate-past-the-facts-of-peak-oil/

http://peakoilmatters.com/2011/02/10/more-never-ending-efforts-to-skate-past-the-facts-of-peak-oil/

http://peakoilmatters.com/2011/04/27/even-more-never-ending-efforts-to-skate-past-the-facts-of-peak-oil/

** A particularly loony, fact-challenged post from last week (discussed in greater detail in my next post) did in fact offer this gem of crazy-eyed, tin-foil-hat-wearing nonsense. (How sad is it that there is an apparently decent-sized segment of the population who actually walk the planet thinking like this and believing/fearing such insane notions?!):

“The great Western banking families always float scarcity memes as a way to consolidate control and further expand global   governance. In fact, if the Peak Oil meme is now going out of fashion, this may only mean that some other kind of propagandistic measures is about to be initiated.

“We don’t know what it is but we can guess, as it seems obvious and evident that the powers-that-be are trying to form pan-national building blocks for world government.” [6]

Sources:

[1] http://www.technologyreview.com/energy/38654/?p1=A1; Peak Oil Debunked by David Rotman – September 22

[2] http://blogs.marketwatch.com/fundmastery/2011/09/19/peak-oil-daniel-yergin-impending-doom/; Peak Oil, Daniel Yergin & Impending Doom by Kurt Brouwer

[3] http://seekingalpha.com/article/295546-hess-ceo-an-oil-insider-not-willing-to-sugarcoat-our-peak-oil-problem Hess CEO: An Oil Insider Not Willing To Sugarcoat Our Peak Oil Problem by Devon Shire – September 23, 2011 [citing comments from Hess Corporation CEO John Hess at http://www.energybulletin.net/node/50502]

[4] http://www.frumforum.com/will-america-survive-the-great-recession; Will America Survive the Great Recession? By David Frum [from a lecture given by Frum at the University of Western Ontario on September 20^th]

[5] http://www.huffingtonpost.com/jeffrey-rubin/even-the-international-en_b_787450.html; Even the International Energy Agency Forecasts Peak Oil by Jeff Rubin – November 23, 2010

[6] http://www.thedailybell.com/2973/Americas-New-Production-and-the-Farce-of-Peak-Oil; America’s New Production and the Farce of Peak Oil – September 21, 2011

[NOTE: This is the latest installment in a new PeakOilMatters series (which started here). It’s about finding a new and better vision to get to, through, and beyond Peak Oil and its widespread impact on what we produce, how we produce, and how we live. We won’t be falling off a cliff tomorrow, and the full brunt of Peak Oil’s effects won’t be experienced all at once, either. Gas and oil do not have to disappear entirely, nor do gas prices have to rise into the stratosphere before Peak Oil’s impact is felt.
Gradually, but inexorably, changes will be in the offing, however. We need to come to a better understanding of this, and start preparing ourselves now for the lengthy transition and just as lengthy ongoing impact of Peak Oil on all of us. Many issues must of necessity be considered, and I hope to make a contribution to the public dialogue we need to have. I hope you’ll find these objectives enjoyable as well as beneficial. We have more of a voice than we think we do. Finding that voice just might be our best hope.]

~~~

(This is a continuation of last week’s post discussing a recent essay by Joel Kotkin urging more domestic fossil fuel production. The last quote of his cited in that post is repeated here:)

“Shale oil deposits in the northern Great Plains, Texas, California and Colorado could yield more oil annually by 2015 than the Gulf of Mexico. Within 10 years, these finds have the potential to reduce U.S. oil imports by more than half.”

“Gail The Actuary” recently posted a very informative piece, and actually addressed this very point, (a follow-up to her discussion in that post of claims—echoed by Kotkin—that the oil shale fields in the U.S. could produce as many as 2 million additional barrels of oil per day by 2015).  She offered several observations which seem to counter those could yields and have potentials:

“I am suspicious that quite a bit of the 2 million barrels a day of additional production by 2015 that is being forecast is not really oil. Instead, I expect it will be natural gas liquids. This currently represents about half of the ‘miscellaneous’ layer [in a chart found in her post]. Natural gas liquids (NGLs) include propane, butane, and other gasses (sic)….
“An increase in NGLs would be of lesser benefit than oil, because it is not directly substitutable for oil, and is a cheaper product. Initially, it would mostly make home heating for those using propane cheaper, but then tend to drive NGL developers out of the market. Unless NGLs can cheaply be converted to higher priced oil products (and refinery capacity can be added quickly to accomplish this), it would seem like a drop in prices would quickly put an end to the NGL ramp-up….
“US oil imports have declined about 25% in the five years since 2005. In the next ten years, I would expect oil imports to continue to decline, regardless of what we do, because the amount of oil on the world market will continue to drop, and oil importers will tend more and more to be in recession. It is not clear how much US oil imports will drop, but a 50% drop in the next 10 years would not seem all that unlikely, regardless of what we what we produce, because of oil exporting countries will tend to consume more, and more countries will shift from being exporters to importers. We are currently importing 9.4 million barrels a day, so a reduction by half by 2020 would be a reduction of 4.7 million barrels a day.” [1]

It’s all fine and well to talk about the “potential” for this or that increase in production. But if it is not placed in the real-world context of increasing demand, depleting oil fields, harder-to-find-and-produce newer resources (meaning more energy being used to produce lesser amounts of inferior quality supplies), and the often-overlooked factor that many oil-exporting nations are now keeping for their own use more of their production totals, then the “potentials” lose much of their luster. Just keeping up with depletion rates still represents a net loss in production if demand is increasing and imports are being curtailed for any or all of the reasons just cited.

And let’s also remember that all of these “new,” more expensive, energy-intensive and time-consuming efforts are taking place because there’s no place else to go. Because these enhanced efforts are more costly, energy prices have to remain high for producers to justify the time, expense, investments (financial, manpower, asset-acquisition), and efforts needed to extract these often inferior oil resources. There is a point when it is no longer economically feasible to invest in production given those limitations and challenges. Higher energy prices are generally not looked upon favorably by consumers. Producers need consumers before they make their investments. Consumers cutting back = less justification for investments, and it’s easy to figure out what happens then.

Gail also comments on the claims that there could be a two-million barrel per day increase in production from the oil shale deposits (something she states “would be a tall order”) by offering some well-reasoned considerations:

“There are several reasons why the hoped for increase might not be realized, however. These include:
“Inadequate infrastructure. One question is whether inadequate infrastructure will prove to be a roadblock to meeting ambitious production goals in five to 10 years….
“Inadequate price. What tends to happen when there isn’t adequate transportation for the oil is the selling price of the oil tends to be depressed, relative to other types….
“It is easy for operators to assume that the price differential will get better, and also that the prices of other types of oil will continue to rise. But all of these things are by no means certain. High oil prices tend to send the economy into recession, so world prices may not rise as much as hoped–they may oscillate instead, rising, then putting the economy into recession and falling again. Also the differential of North Dakota types of crude to Brent may stay low for an extended period, if infrastructure issues cannot be worked out.
“Optimism before drilling. There are many unknowns before drilling including how quickly oil production from individual wells will decline, how long wells will prove to be economic, what proportion of wells will have high production, and the level of oil and gas prices in the future. It is natural for those who are trying to get others to invest in these ventures to base their assumptions on an optimistic view of the future. If experience with shale gas in Texas is any clue, once realities start setting in, the level of drilling may decline, and overall production, after an initial run-up, may decline. If this happens, it will be very difficult to meet the ambitious goals presented….
“If overall production is to be increases by 2 million barrels a day by 2015, it will be necessary to overcome these declines, as well as add 2 million barrels a day of new production. What happens is that each year, more and more oil fields and oil wells within oil fields become non-economic. These are closed. Also, what is extracted is an oil-water mix, and the proportion of oil tends to fall over time. This means that if a given volume of oil-water mix is processed from a well, each year the well will yield less oil and more water.”

Not quite a guarantee, is it?

Mr. Kotkin then turns to natural gas, with all the by-now usual qualifiers and non-specific “statements” which one assumes should be taken as fact (bold/italic mine).

“Even more promising, from the environmental standpoint, are huge natural gas finds. Discoveries in Texas, Arkansas and Pennsylvania could satisfy 100 years of use at current demand levels….
“Natural gas is already muscling out coal as the primary source for new power plants. It can also be converted into transportation fuel, particularly for buses, trucks and taxis.”

What if demand doesn’t stay the same? (Probably a damn good bet that it won’t). Then what? How does transportation fuel conversion take place? How long does it take? How expensive is the process? How efficient? How easy is it to do? How much more gas would be consumed by those converted vehicles, and thus how much less would be available for all other consumption?

And while he’s correct in stating that domestic energy production creates the “potential” (that word again) for “hundreds of thousands of jobs”, wouldn’t a national effort to devote our research efforts, skills, manpower, and resources into alternative sources of energy (which will surely outlast declining supplies of fossil fuels) offer the “potential” for just as many jobs, if not many more—given how much of our infrastructure and industrial/transportation foundation will have to change to accommodate new energy sources?

Reasonable questions all, I’d like to think, but no answers at all in Mr. Kotkin’s article.

There’s also the inconvenient reality that the U.S. is a natural gas importer. We do not produce enough of it to satisfy our needs as is. We turn to Canada as our primary benefactor, but as its demands for natural gas increase (it’s also used in significant quantities just to assist in the production of that country’s tar sands), the less natural gas there is to satisfy Canadian—and American—demand. At some point, the math is not going to work.

Facts….

Gail the Actuary conveniently offered a wealth of information in another recent post that sheds a bit more light on those magical “huge natural gas finds” Mr. Kotkin finds so appealing. (The title of the post: “Don’t count on natural gas to solve US energy problems” offers a clue or two.)

“[N]atural gas is only about one-fourth of US fossil fuel use, so it would be very difficult to ramp it up enough to meet all of these needs.
“One issue is whether a rise in shale gas will mostly offset other reductions in natural gas supply. In Annual Energy Outlook 2011, EIA forecasts that shale gas production will increase from 23% of US natural gas production in 2010 to 46% of US natural gas production by 2035, but that these increases will mostly offset decreases elsewhere. Even with this huge increase in shale gas production, the EIA only sees US natural gas production increasing by an average of 0.8% per year between 2011 and 2035, and US natural gas consumption increasing by an average of 0.6% per year per year to 2035–not enough to make a very big dent in our overall energy needs.”

Thud.

Shale gas production, which is being touted as a door-opener for increasing natural gas production, has its own set of risks and problems. Water pollution from the fracking process employed to produce the resource, earthquakes (no joke; see this), apparently rapid decline in production levels, and the fact that shale gas is not profitable at current low prices are just a few of the negatives. Not much incentive for producers there….

Gail touched on the shale gas issues in her post, suggesting for one thing that increasing the percentage of shale gas in the overall total of gas production “will mostly offset decreases elsewhere.” And natural gas’s lower prices will have less appeal as prices rise—surely an inevitability as demand and production costs increase. Then what?

As for Mr. Kotkin’s “100 years” claim, Gail offers more of those damned facts in rebuttal (citing, as she did with all of her other facts, charts and other sources of official information and statistics. Don’t you just hate that? See this article, also.)

“US current consumption is about 24 trillion cubic feet a year. If we divide the ‘U. S. Future Supply’ of 2,074.1 TCF by 24, we get 86 years, which is the source of the statement that 100 years of natural gas supply is available. But it is not at all clear how much of this is economically extractable with technology that we have now, or will be able to develop in the future. If we exclude speculative resources, we are down to 61 years, assuming no growth in natural gas consumption. If natural gas use rises, we would exhaust those resources much sooner.
‘If we exclude both Speculative Resources’ and ‘Possible Resources,’ then the number of years at current consumption falls to 29 (but much shorter, if production ramps up sharply). The shale gas portion of this is about a third of the total, or approximately 10 years, at current consumption levels.”

Thud, again.

Mr. Kotkin does acknowledge the legitimacy of environmental concerns arising from oil and gas production as they compare to the risks now quite evident to all in the wake of the disasters in Japan:

“But compared with the existential threat of nuclear radiation, even potential oil spills and damage to water supplies from fracking shale might be regarded as tolerable risks for which we have considerable experience and technology managing with enhanced regulation.”

Permit me to introduce you to the right-wing of our federal government and the big money interests which largely dictates its agenda. “Enhanced regulation?” Seriously? From this narrow-minded, shortsighted group of legislators beholden to corporate America? This same group of “leaders” who by all indications have little regard for what their own (non-wealthy) constituents are calling on them to do? I’m not sure that relying on them for “enhanced regulation” is likely going to meet with much success, although there is no question that is absolutely necessary.

“The record shows that without effective government oversight, the offshore oil and gas industry will not adequately reduce the risk of accidents, nor prepare effectively to respond in emergencies.” [2]

Credit where credit is due however. Mr. Kotkin does add:

“Republicans, too, need to give up their ‘bests’— including the notion that no policy is always the best, usually a convenient cover for the narrow interests of large energy corporations. Allowing private corporations to unilaterally determine our energy policy makes little sense. After all, most of our key competitors — China, Brazil and India — approach energy not as an ideological hobby horse but as a national priority.”

He concludes with these observations:

“The time has come for both political parties to give up their ‘best’ energy options for the good. A green economy that produces millions of new jobs is a laudable goal. But the renewable sector cannot develop rapidly without massive expenditures of scarce public dollars. To fully develop these technologies, we need lots of money and time….
“It’s time to demand that our deluded, and self-interested, political class develops an energy policy based not ideology but on how to best guarantee prosperity for future generations of Americans.”

Drilling for more oil, or pursuing questionable practices to release shale and natural gas are fraught with their own set of risks and consequences. In truth, there are no energy policies that won’t require significant compromise, sacrifice, and expense. Weighing the advantages and disadvantages, together with the benefits and rewards is no easy, quick, or guaranteed strategy. If we wait until everyone is on board we’ll be having this same conversation 500 years from now.

But to insist that our energy policy must be to keep devoting “scarce public dollars” (and scare private ones, too) to resources on a steady path of decline, guaranteeing only more difficulties and hardships down the road, is an energy policy to nowhere. There’s no doubt that we have enough fossil fuel resources to last a good number of years (given oil depletion and increasing demand, the math makes the exact date irrelevant, and I’m not a seer). But they are resources harder to come by, more costly, and well on their way to soon being insufficient to meet the many legitimate demands and needs of an over-populated world. What’s the advantage in spending “money and time” on endeavors that will lead to a gigantic energy dead-end? How much more trouble should we be looking to create for ourselves?

Our priority—our focus—must turn away from fossil fuels now, while we still have enough available to help ease us into the process of transitioning away from those very resources. That is a task of unimaginable complexity and effort. Waiting for a better day is not a choice. That day has passed. Let’s not let too many more slide by in foolish pursuits.

Sources:

[1] http://ourfiniteworld.com/2011/02/14/is-shale-oil-the-answer-to-peak-oil/; Is “shale oil” the answer to “peak oil”? by Gail Tverberg – February 14, 2011
[2] http://www.infrastructureusa.org/deep-water-the-gulf-oil-disaster-and-the-future-of-offshore-drilling/; DEEP WATER: The Gulf Oil Disaster and the Future of Offshore Drilling – January 10, 2011

[NOTE: This is the latest installment in a new PeakOilMatters series (which started here). It’s about finding a new and better vision to get to, through, and beyond Peak Oil and its widespread impact on what we produce, how we produce, and how we live. We won’t be falling off a cliff tomorrow, and the full brunt of Peak Oil’s effects won’t be experienced all at once, either. Gas and oil do not have to disappear entirely, nor do gas prices have to rise into the stratosphere before Peak Oil’s impact is felt.
Gradually, but inexorably, changes will be in the offing, however. We need to come to a better understanding of this, and start preparing ourselves now for the lengthy transition and just as lengthy ongoing impact of Peak Oil on all of us. Many issues must of necessity be considered, and I hope to make a contribution to the public dialogue we need to have. I hope you’ll find these objectives enjoyable as well as beneficial. We have more of a voice than we think we do. Finding that voice just might be our best hope.]

~~~

I have on several occasions (most recently here) commented on the determined efforts of some to either blindly ignore facts about climate and energy challenges, or present pseudo-arguments which upon even the briefest of examinations prove to be not much more than at-best disingenuous and misleading. To what end, however, I have not yet figured out.

Joel Kotkin recently posted on The New Geography website arguing that the United States must work to expand production of its “ample” (?!) oil and gas supplies. (The website is not exactly a bastion of broad-minded liberal thinking, although Mr. Kotkin is one of the contributors who generally offers reasoned arguments advocating his positions, rather than uttering nonsensical conservative/libertarian sound bites which sadly tend to get more air play—and I say this even though I almost always disagree with his and New Geography’s perspectives.) Although Mr. Kotkin is probably correct that the recent Japanese catastrophe may have ended (whether justified or misguided) any support for nuclear power power here for the foreseeable future, his reasons for urging greater fossil fuel production are governed by the same misguided and factually-deficient motivations that lesser advocates likewise propose.

If you are one who defines “long-range planning” as extending not much beyond a few weeks from now, then pursuing more fossil fuel development as our primary energy policy is a great choice.

As with almost every choice we face regarding the energy resources we’ll depend on in years to come, there are sound arguments for and against most policies under consideration. At some point, however, we will have to make some tough decisions. Delaying the inevitable can no longer be an executive strategy, however. The time to begin making difficult decisions (sure to antagonize, dismay, or confound a sizeable percentage of citizens and experts alike no matter which policies are eventually pursued) needs to begin a couple of years ago.

Richard Heinberg said it best (no great surprise):

“Either we direct public investment toward developing expensive, low-grade fossil fuels (such as tar sands, oil shale, and shale gas) in a vain effort to maintain growth in our fossil-fuel dependent economy, or we direct investment toward building the renewable energy infrastructure of the future.” [1]

I can’t disagree with the premise Kotkin raised that at least some progressives overestimate how quickly and successfully renewable fuels might supplant fossil fuels. But an implied criticism that they will be “highly dependent” on subsidies ignores the fact that the entire Republican contingent in the House recently voted unanimously to continue subsidies for the oil companies. (And I’m not clear why he states that the wind power industry’s receipt of “subsidies many times higher per megawatt hour than fossil fuels” is really the appropriate benchmark in determining that assistance. The renewable/alternative industries have a lot of catching up to do, and it’s delusional to pretend their contributions to our energy future won’t play important roles.)

Worth noting:

“… the big five oil companies — BP, Chevron, ConocoPhillips, ExxonMobil, and Shell — made $893 billion in profits (my emphasis) from 2001 to 2010.” [2]

Given what is at stake in terms of our economic future and increasing energy needs worldwide—on a planet with diminishing fossil fuel resources, coupled with the complexity of and the nearly-inconceivable efforts required to transition us away from fossil fuel dependency in favor of as-yet-undetermined combinations of “other” fuel resources—subsidies are almost mandatory for renewables/alternatives. What may not be so necessary in an economy with limited financial resources to spread around are subsidies for industries managing a tidy few hundred billion in profits.

“In the face of sustained high oil prices it was not an issue—for large companies—of needing the subsidies to entice us into looking for and producing more oil,” [Former Shell CEO] John Hofmeister told National Journal Daily…“The fear of low oil prices drives some companies to say that subsidies should be sustained,” Hofmeister said. “And my point of view is that with high oil prices such subsidies are not necessary.” [2]

Continuing on that same theme, Kotkin criticizes wind power’s relatively feeble contribution to supplying the nation with electricity. He then offers up a right-wing talking point which cheapens his position unnecessarily as he snarks about wind turbines “wiping out whole flocks of birds.” As someone who generally releases insects back into the outdoors when I find them in my home, rather than just stomping on them, I’m certainly concerned that countless numbers of birds have reportedly been injured or killed by the fan blades. Just wish some of that same “concern” would have been evidenced by Kotkin’s conservative/libertarian peers when so much wildlife was killed during the charming Gulf of Mexico oil spill last year. Relying on the birds-being-killed argument as a foundation for dismissive treatment of a renewable is not the type of visionary thinking we can afford at this point. There are others on the Right for whom that nonsense is better suited.

His legitimate concern that solar panel production has been largely taken over by China would have been a fairer statement had he mentioned how little federal support solar production (and all other renewables, for that matter) has been accorded in comparison to the fossil fuel sector. Perhaps a more concerted effort by leaders of both parties might have ensured a more favorable economic environment for that industry to take flight here in the U.S.

Although the comment was directed to Haley Barbour and others flying oil company flags—while they (of course) go on blaming President Obama for high prices at the pump and criticizing his energy policies in general—Joseph Romm’s observation applies just as well here:

“There is a notable theme here — aside from crass political point scoring, these attacks are calibrated to protect oil as a primary energy source at the expense of cheaper green alternatives, while pushing for even more oil drilling here in the United States. These opportunistic attacks come as the oil industry prepares to pump unprecedented sums of money into the political process. Since the midterm elections, the oil industry has ‘been very aggressive right out of the gate because of the huge opportunity with the election of their allies,’ as Daniel J. Weiss, the director of climate strategy at the Center for American Progress Action Fund, told the Houston Chronicle yesterday. Oil and gas companies spent $146.3 million on lobbying last year, and that number is poised to rise as the presidential election approaches. For example, the American Petroleum Institute will start donating money to political campaigns this year.” [4]

(To be fair, Kotkin also mentioned that many conservatives are beholden to the nuclear industry for similar reasons.)

His essay then lapses into the dismal, imprecise-but-sure-to impress buzzword strategy I’ve been criticizing repeatedly (bold/italic mine).

“The pragmatic way out of this emerging energy mess means focusing on our increasingly abundant supplies of oil and gas.”

“‘Peak oil’ enthusiasts may not have noticed, but recent discoveries and improvements in technology have greatly expanded the scope of U.S. energy resources. New finds are occurring around the world, but some of the biggest are in the United States.”

“Shale oil deposits in the northern Great Plains, Texas, California and Colorado could yield more oil annually by 2015 than the Gulf of Mexico. Within 10 years, these finds have the potential to reduce U.S. oil imports by more than half.”

U.S. production peaked forty years ago and we now produce only about half of what we did at the peak! Exactly how impressive are “increasingly abundant supplies” (“some of the biggest” no less!) when measured against that fact? Where is any mention of ongoing depletion rates which mitigate against oil production increases and resources? Conveniently omitting any explanation about what’s involved in the production of oil shale (cost, effort, energy resources used, actual as well as projected production levels, pollution and other environmental degradation concerns, etc.) skews the reality about those “some-of-the-biggest/abundant supplies” just a bit, as does the failure to mention the technological challenges (and hence expense, cost, time) in offshore or Arctic drilling….

“Here we go again. Every time gasoline prices spike, no matter the reason, Republican leaders and talk radio’s libertarian elite reach for the American Petroleum Institute’s (API) latest talking points and crank up the “drill, baby, drill” rhetoric….
“The GOP’s real energy crisis is one of focus. Republican leaders are focusing their energy on keeping America overly dependent on a resource that is far more plentiful outside our own borders. They largely dismiss the strategy of reducing demand and seem content to have us suck our own limited oil reserves dry as quickly as possible. It is a phony solution that they think will play well politically.
“Peddling geologic ignorance may score some points with voters who don’t know any better, but it won’t bring the promised relief at the pump.” [5]

And as for Kotkin’s “could yield more oil annually by 2015 than the Gulf of Mexico” meme:

“Deep-water” begins at 500 metres. In total there are around 70 oilfields in the Gulf of Mexico that are at least this deep. The total production from these wells is 800,000 barrels of oil per day (b/d). BP’s flagship the Thunder Horse platform contributes about 250,000 b/d. They will maintain this maximum production for about 5 years and it will then begin to decline.
“Mars-Ursa is the largest oilfield in the GOM. Production began in 1996, gave maximum production of 270,000 barrels per day from 2001 to 2004, and now production has dropped to 150 000 barrels a day. In a few years it will be finished. New oilfields in deep-water or in the Arctic will experience the same brief history. Those 800,000 b/d that today are produced in the Gulf of Mexico make up approximately 1 % of global production. The reality is that it would be fairly easy to do without all of this production.”

In a world that uses some 85 million or barrels of oil per day, we probably don’t need to spend much time on a resource that provides less than 1% of the total. So touting a replacement that could/might/possibly double that amount still isn’t worth a lot of space on a page … at least if you are also considering depletion rates on existing fields vs. increasing world-wide demand. The math gets ugly, and that tiny percentage becomes even less impressive.

One more point to mull over for now:

“In the wake of the BP Deepwater Horizon disaster—a crisis that was unanticipated, on a scale for which companies had not prepared to respond—changes in safety and environmental practices, safety training, drilling technology, containment and clean-up technology, preparedness, corporate culture, and management behavior will be required if deepwater energy operations are to be pursued in the Gulf—or elsewhere. Maintaining the public trust and earning the privilege of drilling on the outer continental shelf requires no less.” [7]

“Oil reserves have been declining for a decade, and it is an article of faith among petroleum geologists that the easy oil — easier to find, less complicated to drill — has all been extracted and that the explorers are now into the hard oil. When the Deepwater Horizon rig, drilling an exploratory well deep into rock through a mile of water and three miles into the ocean floor off the Louisiana coast, struck a highly pressurized pocket of oil and gas, causing an explosion, it was in some ways a consequence of this iterative, competitive game, each generation of discoveries pushing further into the unknown.
“A few years ago, the industry norm was to drill at depths of 15,000 or 20,000 feet. Now the frontier is 35,000 feet, where engineers find higher temperatures and pressures. ‘The scarcity of new reserves has been driving companies into plays that have previously been seen as extremely high risk and high cost,’ said Brian Maxted, the chief executive officer of Kosmos Energy, a deepwater-exploration company in Dallas. ‘The trend recently has been in going toward ever-deeper waters and ever-more challenging environments.’” [8]

Not cheap. Not easy. Not quick. Not good. (Damned facts!)

I’ll have more to say about Mr. Kotkin’s oil shale observations (and other comments in his article) next week.

Sources:

[1] http://old.globalpublicmedia.com/memo_to_the_president_elect; Museletter [200]: Memo to the President-elect on Energy Realism and the Green New Deal; December 2008
[2] http://theenergycollective.com/josephromm/53216/drill-baby-drill-fails-oil-prices-soar-spite-sharp-increase-us-production-under-oba?utm_source=tec_newsletter&utm_medium=email&utm_campaign=newsletter; Oil prices soar in spite of sharp increase in U.S. production under Obama by Joseph Romm – March 9, 2011
[3] http://wonkroom.thinkprogress.org/2011/02/11/oil-subsidies-ceo/; Ex-Big Oil CEO: Subsidies For Oil Companies ‘Are Not Necessary’ by Pat Garofolo – February 11, 2011
[4] Romm – see [2] above
[5] http://www.frumforum.com/the-gops-oil-drilling-pipe-dream; The GOP’s Oil Drilling Pipe Dream by David Jenkins – March 15, 2011
[6] http://www.energybulletin.net/stories/2011-03-15/%E2%80%9C-oil-arctic-not-worth-risks%E2%80%9D; The oil of the Arctic is not worth the risks by Kjell Aleklett, President of ASPO International – March 15, 2011 (Original article: http://aleklett.wordpress.com/2011/03/15/%e2%80%9cthe-oil-of-the-arctic-is-not-worth-the-risks%e2%80%9d/)
[7] http://www.infrastructureusa.org/deep-water-the-gulf-oil-disaster-and-the-future-of-offshore-drilling/; DEEP WATER: The Gulf Oil Disaster and the Future of Offshore Drilling – January 10, 2011
[8] http://www.nytimes.com/2011/01/16/magazine/16Drilling-t.html?_r=1&ref=todayspaper&pagewanted=all; The Will to Drill By BENJAMIN WALLACE-WELLS – January 16, 2011

In a recent post (here), I indicated that there were two more recent articles unseriously attempting to persuade readers that all is well in oil-production world. I’ll discuss the second piece today. (There are always more, of course, but these two jumped out at me as “better” examples of misguided attempts to deny that we have any fossil fuel resource problems.)

This Fortune magazine piece describes with near-breathless delight the apparent findings of not just one or two or four, but six “huge” oil fields! The existence of these fields is not exactly new news, but no matter. The good news touted here, however, is that we’re “awash in petroleum.” Such good news!

Let’s jump right in [emphasis added is mine]:

“There are many oil reserves around the globe that remain untapped, and explorers continue to discover new fields deep beneath the earth’s surface. Depending on how the controversy surrounding the Arctic National Wildlife Refuge turns out, the U.S. could exploit oil reserves in the area, despite potentially grave environmental consequences.”

“Depending”; “could” … along with “might potentially”, “if” “could be possible”, and an array of similar, carefully-worded utterly-lacking-in-certainty phrases are the apparent stock in trade for those denying those annoying facts about declining world oil production.

Kind of like the “job-killing”, “death panel”-laden health care legislation … these buzz word continuously repeated (without bothering to explain any of the actual facts that the rest of us deal with here on Planet Earth) sooner or later take on a life of their own. Soon enough “could exploit oil reserves” to the many non-discriminating readers simply becomes “lots of easily-accessed oil just waiting for someone to stick a straw in and pump it all out and so-what-the-hell-are-you-all-waiting-for?”

“Depending on how” the “controversy” (?) pans out in the Arctic means … what? Mentioning just the political controversy (my assumption as to the reference) over which nation can lay claim to any possible resources in the Arctic ignores a whole lotta other issues like finding it; getting to it; producing it! Hello! We’re talking about the possibility of finding and extracting fossil fuel resources in the Arctic! The place that’s very, very cold and has a lot of very, very thick ice on top of … everything … most of the time!

Realistically, full production is several decades away, and the total isn’t likely to meet even 5% of our needs. “Cheap, easy, soon” are words one will never hear when discussing the “potential” oil in the Arctic. Damned facts….

And what’s with the “despite potentially grave environmental consequences”? That actually sounds vaguely serious. Perhaps reporter Shelley DuBois might have lingered for just a moment on that phrase and explained … anything about it? “Grave” and “consequences” in the same sentence rarely lead to good things. But hell, if that’s just going to slow down the process of skipping past facts, then by all means, ignore away!

“Elsewhere there are even more reserves, but they’re often in places that are either geologically or politically difficult to access. Some of them come with dangerous security risks to drilling.”

Well that’s a relief! Still reeling from the whole “grave consequences” thing, for a moment I thought there might be some more problems. But since there’s no explanation, I guess not! That was a close one … whew!

This piece then provides brief statements about these 6 “huge” oil fields. [NOTE: all statistics to follow are taken from this Fortune article unless indicated otherwise.] I’ll touch on just a few points.

Mexico’s Chicontepec Basin has 10 billion “estimated” barrels of recoverable crude oil. Wonderful … that’s four month’s worth of world demand, and all from a country whose oil production has tanked in recent years. Hard to imagine a lot of money has been poured into the infrastructure during this decline, so one should wonder about the capacity to extract the fossil fuels, but let’s give Mexico the benefit of the doubt.

Mentioning the recent decline in production in passing at least counts for something, even if there is no tie-in to how this off-setting depletion in existing fields might diminish the attractive estimates from Chicontepec Basin. I guess there’s not much to be concerned about.

The big kahuna in this article is Venezuela’s Orinoco Basin, “a huge chunk of reserves inland, in a stretch of about 20,000 square miles” that is estimated to hold more than 500 billion barrels of oil. Very impressive to be sure. In fact, a 2006 article from petroleumworld.com suggested reserves of more than a trillion barrels, although only about 25% – 30% was then deemed recoverable. I have seen similar figures elsewhere, but I’ll go with Fortune’s figures for this discussion. (About a year ago, I wrote a post devoted to Venezuela and issues relating to its oil production capabilities. You can get more info’ here.)

What the 2006 article was thoughtful enough to provide (perhaps space limitations precluded Fortune from supplying this innocuous fact) is an explanation that producing Venezuela’s “heavy oil” is … well, what you might imagine producing heavy oil to be like:

“Coaxing marketable oil out of the extra-heavy sludge and coal-like deposits of the Orinoco is extremely expensive, labor- intensive, and has required both the technological muscle and cash of Big Oil.”

There goes any possibility of “cheap, easy, soon”! And let’s keep in mind that that country’s leader, Hugo Chavez, is not what anyone would consider to be a fan of ours. We should not expect lots of oil favors from him. As the author of this Fortune article states: “U.S. relations with Venezuela have been tense.” Relations between loony Tea Party extremists and far left bloggers here have been similarly “tense.” I’m not seeing much in the way of better scenarios any time soon.

“The country estimates a substantial jump in production from the area, claiming that the Orinoco will add another 400,000 barrels per day to its production by 2016.
“There’s some debate over whether they’ll make that goal — and even over how much oil Venezuela currently produces. Venezuela claims that its national oil company Petróleos de Venezuela SA produces 2.96 million barrels per day. U.S. estimates are generally lower, around 2.09 million barrels per day.”

Let’s give Venezuela the benefit of the doubt, round up to 3 million barrels per day, and then tack on 400,000 more per day. My math says that’s 3.4 million barrels per day, or almost 1.25 billion barrels per year. Very impressive. Gonna take a while to squeeze out 500-plus billion barrels at that rate (completely ignoring the fact that a one-third recovery is a good ballpark figure for production from most fields.) Of course, this assumes (I can do that, too) infrastructure and investment/economic/production considerations remain supportive, and that those pesky “extra-heavy sludge” factors don’t prove too daunting. I’m sure someone will invent something soon to take care of that—ideally at very low cost, easily utilized, and one that restores the oil fields and basins to pristine environmental conditions in no time at all.

The next source of magic are Brazil’s Santos and Campos Basins, estimated to hold “up to” 123 billion barrels of crude oil. Certainly not a pittance!

But like Jeremy Bowden’s article which I discussed last week, curious facts about the efforts to produce these fields popped up in the DuBois article:

“East of Rio de Janiero, Brazil’s Santos and Campos Basins contain tremendous oil reserves in something called a pre-salt layer. The oil and other petrochemicals are trapped under about two miles of salt and rock layers, which starts about a mile deep in the Atlantic Ocean.”

So … a few hundred bucks worth of investment, coupla weeks off the coast of sunny Brazil, a little bit of work here and there, and presto, we have 123 billion barrels of oil, right? (I’m just supplying “facts” about production … the Fortune article didn’t get around to that. Perhaps, however, I underestimate the challenge? Ya’ think?)

The other 3 fields mentioned in this article are first, an estimated 45-100 billion barrels superfield in Iraq—a real hot-bed of civility, sound infrastructure, solid government, and all the economic wherewithal any oil producer might need, right? And let’s just ignore this little bump in the road:

“The problem with Iraqi oil production is in the refining process. Right now there aren’t enough refineries with capacity to process so much crude. There’s also a paucity of fresh water in the region–a key resource for petrochemical processing.”

The “refining process” is the only problem? Seriously? All by itself that’s an enormous challenge and one not likely to be successfully resolved any time soon. And fresh water in the desert to fix that other problem will come from … ? Sure hope none of the Iraqi citizens get to those limited supplies of water before the oil companies do. They might drink it, or something!

DuBois then discusses the (estimated) 11 billion barrel offshore Kashagan field in Kazakhstan. Slight issue, easily resolved I’m sure:

“Offshore Kazakhstan is tricky to develop. The oil is sulphurous, and it’s combined with a high quantity of high-pressure natural gas. Also, drilling platforms have to be incredibly sturdy to weather the harsh conditions in the Caspian Sea.”

I’m not seeing “cheap, easy, soon” there, either. Also not seeing any facts to explain how those challenges might be handled—easily, cheaply, or soon.

And finally, the jaw-dropping, whopping 1.8 billion barrel (estimated, of course) Jubilee field off the coast of Ghana. That is, Jubilee “could ultimately produce” [my emphasis] that much oil. Pigs could fly, and we all could win the lottery tonight, too. But 1.8 billion barrels of oil is 1.8 billion barrels, enough to satisfy world demand for damn near … 3 whole weeks!

We’re well past the time when we need those in the know about the oil industry to speak the truth and only the truth. We who are not in the know need to better understand the facts and consider the sources of information supplied, and of perhaps greater importance: what’s not being explained. Motivations for disseminating various levels of information can be complicated.

Might not be a bad idea for our leaders to consider this strategy of telling the truth and offering us a heads-up, too.

Our work is cut out for us—all of us.

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….

What kind of a nation do we want to be?

This will be, if not the most important question we’ll collectively ask ourselves in the months and years to come, in the top 2 or 3.

The answers we produce—“we” being our political leaders, our business leaders, the media, and perhaps most importantly: each and every one of us—will obviously determine the strategies we adopt and the successes and prosperity which (we hope) will remain available to us. In this new series, I’d like to offer my two cents’ worth and provide some talking points to help us sort things out.

If we are not standing at the most critical crossroad of our industrial and economic history, the signs on the side of the road are letting us know it is coming up soon.

We face some challenges. The headlines tell us all we need to know about employment and economic woes, the increasingly disheartening hypocrisy and gamesmanship that continue to define politics here in America, and a growing unease about the direction of our country. I begin writing this post only 24 hours after the tragic, senseless, idiotic massacre in Arizona that nearly claimed the life of a by-all-accounts well-respected Congresswoman, and did in fact kill several other just-as-innocent bystanders. (A nine-year-old girl? Really? How is that justified under even the most insane of insane defenses?)

Climate change evidence continues its daily march into reality—the inability of deniers to grasp simple truths notwithstanding. And atop and amid all of these lovely and encouraging challenges, we have some fossil fuel resource problems knocking on our door.

Let’s hope that the convergence of these issues sparks a different level and quality of public discourse. Most would be hard-pressed to think that that would not be a good thing….

As I and others have taken great pains to explain, if we have not yet reached the point where we have extracted and sent to market the highest level of oil production we’ll ever attain (I think we have, as does the International Energy Agency, among others much more in the know than me), we’re pretty damn close. And as I and those same others have taken other great pains to explain, we’re not on the verge of imminent collapse, either. The process of ever-declining oil production, and thus ever-declining amounts of oil available to us, will unfold over a fairly lengthy period of time. I have no plans for a Chicken-Little-Sky-Is-Falling party anytime soon. Despite the efforts of peak oil deniers to attribute this false claim to us, we are not running out of oil—at least not for many decades.

That does not mean we are problem-free for years or decades to come, however. We need to shine some light on that distinction while starting the very lengthy and complex process of transitioning our everything away from never-ending reliance on fossil fuels … oil, specifically.

There are still many billions of barrels of conventional oil still buried underground, and perhaps many more billions—hundreds, perhaps—of unconventional supplies buried as well. If that’s where the discussion could end, then Peak Oil would indeed be the rantings of another group of paranoid conspirators rightfully ignored as should be those who continue to think President Obama was born on Mars or wherever.

But it’s a wee bit more complicated than that.

The fact that we may have enormous quantities of unconventional reserves/resources underground isn’t the be-all and end-all of the are-we-or-aren’t-we-running-out-of-oil discussion. What must be understood more clearly is that having those presumed resources in the ground is one thing and all fine and well as a starting point. But getting unconventional resources (by fact and definition available only with considerable extra effort, time, and cost) out of the ground and into the marketplace at reasonable costs and in reasonable time frames while conventional supplies continue to decline is a very, very different thing. They are called “unconventional” for a number of reasons, after all!

If it costs more (and let’s not even discuss the environmental degradation and water resource consumption issues that are part and parcel of unconventional oil extraction and production), takes more time to get to the market, is of lesser quality, and clearly much more difficult to extract, the math doesn’t work. Unconventional resources aren’t the answer … not even close. (Tighter supplies of the conventional fossil fuels our engines are designed to burn means higher costs at your local gas station, for one thing. Anyone experiencing anything like that nowadays?)

Demand worldwide is increasing, regardless of where the charts suggest U.S. demand might be right now. As much as we like to admire our exceptionalism and burnish our lofty perch as the One and Only, we’re not alone on the planet, and what we want isn’t the beginning and the end of discussions about resource consumption and supply.

There are many billions of people on this planet who do not now enjoy and have never enjoyed the levels of growth and prosperity this nation has been blessed with, and there are very few among those billions who would not like their own chance at their own version of the American Dream—tarnished and bruised though it may be. We—they—are confronted with a pretty simple yet very powerful obstacle, however.

Finite resources are … finite. Not infinite. Not not finite. Whatever spin one may wish to employ to make the problem go away, the math is what it is. It takes some impressive contortions to suggest that the increasing demand clashing with declining supplies shouldn’t concern any of us. In one sense, those deniers are correct on the “any of us” scale … it concerns all of us.

Production is declining, however slowly that may be; unconventional resources are not making up the difference; alternative energy supplies are many, many years away from supplanting the fossil fuels we’ve depended on for the last 150 years or so, more people are asking for more of this declining resource, we don’t have an infrastructure in place to accommodate the requirements of non-fossil fuel resources, and there is no magic out there which will enable the increasing demand to be satisfied in full, at acceptable prices, quality, or timeliness. That is not going to change, and not going to get better. A month bump-up in production here and there sounds wonderful, but long term, it means next to nothing.

Facts are indeed annoying as hell. But the sooner more of us take the time to understand and appreciate what we must deal with, the sooner we can devise and then employ the strategies we’ll need, and the sooner we unleash the still-awesome capabilities of this nation and its remarkable citizenry to create a future that may just turn out okay despite our seemingly-best efforts to keep screwing it up.

I am by temperament a very optimistic person, and it is that attitude that will guide my efforts in this humble little blog to get us thinking and being and doing differently. Not easy? Check. Highly idealistic at the moment? Double check. Not enough to dissuade me? Triple check.

We need to take a look at where we are and what we are doing in a world now filled with relentless and great change, complexity on levels never before imagined, and widespread hopes for progress intersecting on the back side of a nearly-overwhelming global financial crisis. At the same time, these circumstances demand that we come to some better understandings and decisions about what we are doing to both adapt to energy and environmental concerns as well as participate in that adaptation if we continue to hold on to hope.

That’s the hyper-broad overview….

Recognition that change is taking place is the first step to then embracing it and participating in its evolution. Opportunity, or crises?

I’m no historian, but my vague recollections of American History suggest that “difficult” has never been the one insurmountable obstacle that has kept us from achievement. No reason to change that now.

I’m going with “Opportunity”, and will devote most of my posts in these next few months to exploring what that means and what we might do to seize the moments that now present themselves. Hope you’ll stay tuned.

To be continued next week….

Sigh….

This is my last planned post of 2010, and it was not my intention to discuss more curious examples of the phenomenon of ignoring facts. Like those who deny global warming amid an avalanche of evidence, the stubborn resistance to peak oil remains just as … well, stubborn. (When our military is worried, we should be, too.)

In a recent post, I suggested that calling out the nonsense from those who deny that we will soon confront the effects of declining oil supplies must continue. Those of us who seek only to inform others have an obligation to share what we know: that we have some energy-related issues on the near-horizon that will require a great deal more effort and innovation than we’re prepared for (to put it mildly). To that end, I also posted these two essays (here and here) as example of what we must continue to do, and why.

This is not to say I/we should engage ourselves in endless games of ping-pong with those for whom facts remain just another issue to ignore. Arguing nonsense for reasons that remain entirely unclear to me is a curious phenomenon of our political and energy discourses. The International Energy Agency has now issued its stamp of acknowledgment that we actually passed peak production in oil back in 2006. Given that, one would think that since one of this planet’s most important energy and oil production organizations is now on board, perhaps the deniers might consider devoting their considerable efforts to helping us figure out what comes next instead of engaging in cherry-picking and smokescreening.

Disingenuous arguments seem to serve no legitimate purpose if one assumes that sharing information is designed to … inform! And denying peak oil does not imbue anyone with Peak Oil-impervious safety shields; deniers will be obliged to endure the same consequences as the rest of us.

Robin Mills enjoys some measure of prominence in the peak oil world. A published author (The Myth of the Oil Crisis: Overcoming the Challenges of Depletion, Geopolitics, and Global Warming), and energy economist, Mr. Mills recently posted an article in The National, a major English language publication in the Middle East. In it, Mr. Mills again disputes that we are in a world where oil production has now reached its zenith, and argues instead that peak demand will prove to be more of an energy issue in the years to come.

Taking the same tiresome tack that others have, Mr. Mills makes note of the fact that past forecasts of peak oil have been wrong, and so therefore current predictions (citing Sir Richard Branson’s position, for one) are likewise just more doom-and-gloom foolishness. Curiously however, he cites Shell geologist M. King Hubbard’s 1956 prediction that peak would be reached around the year 2000. For someone making that kind of prediction almost half a century in advance, turns out he was pretty close, so I’m not sure why anyone would still be scoffing at that prediction given what has now been confirmed by the IEA! Mr. Mills fails to note that Dr. Hubbard also predicted U.S. peak production would occur in 1970. Bingo!

Mills then states:

“But the current generation of doomsayers, often not oil professionals, have neither addressed reasons for so many incorrect predictions of apocalypse, nor explained why this time their warnings are any more credible.”

Seriously? I’m pretty much a nobody in the Peak Oil world (definitely not an oil professional, duly acknowledged) yet I’ve managed to come up with a pretty fair amount of information supporting the facts of and about our looming oil crisis—easily obtainable, by the way, (and from quite legitimate sources)—and I’ve got about 80 blog posts behind this one to provide some of that credibility he finds lacking … damned facts screwing things up again! Sprinkled amid my “Daily Review” blogroll on the home page are some other quite serious and credible authorities on the subject, if my work won’t suffice. It’s not a difficult undertaking to find the facts.

For some reason, the “giant” oil finds in recent years off the coast of Brazil appear to be one of the Holy Grails of peak oil denial. Mills cites “5 billion barrels or more of reserves” in the Tupi field, at just $14.00 per barrel (his statement) as evidence of “easy oil”, which at this point is neither here nor there. Most of what’s being explored or produced is by no definition “easy”, so claims about a field that’s easily accessible and inexpensive to produce is not the be all and end all. Oh, and by the way, Tupi lies more than a mile below the ocean surface, and then another 3 miles or so below sand, rocks, and salt deposits. Piece of cake! This is where oil exploration is taking place. Easy? Seriously?

And in a world that uses 30 billion barrels of oil per year, one 5 billion barrel field is …. well, pretty ho-hum. Better than a stick in the eye, but this is supposed to serve as a prime argument for the deniers? Really?

He then adds:

“Meanwhile, new technology and investment-friendly policies in mature oil producers such as Oman and Colombia have reversed apparently terminal decline.”

I guess this is also supposed to throw a cold, wet blanket over the arguments (and facts) favoring Peak Oil, but seriously … Oman and Columbia? It took close to 60 seconds for me to Google the oil production levels of those two countries, and according to our own Energy Information Administration (U.S. Department of Energy), Oman produced just over 800,000 barrels of oil per day last year (approx 300 million barrels in 2009). Columbia managed about 250 million barrels in 2009.

On a planet that uses approximately 80 million barrels of oil per day, Oman and Columbia provided Planet Earth with about a week’s worth of oil. Hallelujah! Our oil problems are over! (As an aside, a day or two after Mr. Mills’s article, this piece indicated that Oman is expected to reach 1 million barrels of oil per day in production by 2015. Good to know that in about 4 years, we’ll add to our annual supply almost enough oil to get us through one late lunch.)

Forgive me, but I can’t find much solace in Oman’s and Columbia’s efforts. This doesn’t help (in a story about enhanced oil recovery efforts in the Middle East):

“[T]he International Energy Agency estimates that oil production from currently exploited sites will decline by  two-thirds by 2030. This means that nearly 50 million barrels of oil production per day will need to be made up for….” [1]

Nor does this:

“…conventional oil reserves are being depleted throughout the world at twice the rate of their replacement, historically slow annual capacity declines from major oil fields are being replaced by rapid declines from significantly smaller new developments, and finally marginal new reserves such as arctic and deep water oil accumulations require inordinate new technology advancements and massive funding in order to be brought on-stream in adequate volumes as affordable costs.” [2]

Not to pick on Mills too much longer, but his article also suggests that “Unconventional oil output, such as that from fractured shale rocks in the US and the sticky bitumen from Canada’s famous oil sands, inches up remorselessly. Frontier exploration has uncovered large fields in Africa and holds promise in new areas, such as Greenland.” Like most others who tout shale and the environmentally destructive tar sands of Canada as yet another grand solution, no mention is made of what is required to extract, refine, and produce these inferior quality fossil fuel substitutes. That information tends to diminish the appeal of unconventional resources. But why let facts get in the way?

How many barrels of oil can we expect from a “holds promise”? Perhaps it’s just me, but I’m not finding a happy place thinking about oil goop inching up “remorselessly.”

Also worth noting that the now infamous WikiLeaks scandal disclosed some comments from government officials about those tar sands:

“[T]he Obama administration is aware of how destructive tar sands oil is — and plans on moving ahead with the pipeline that will pump it across the US regardless.

“The cable makes it clear that both Canada and the United States are aware of the dreadful impact of the Alberta tar sands — roundly dubbed the ‘most destructive project on earth’. Yet, the public statements from both parties differ significantly from the private cables.” [3]

Oops!

And as the final coup de grace to Sir Richard Branson’s concerns about an imminent “oil crunch”, Mills asserts that there are “credible scenarios for significant growth in supply.” Probably ran out of space before he could explain anything about what that means, but “credible scenarios” sure sound good to me! There are also credible scenarios for my finding buried treasure in my back yard, but I’m not at liberty to explain.

Another recent blog post offered this:

“Must be time to update my semi-regular ‘peak oil is stupid’ rant.  So here goes…

“I don’t care when oil (OR COAL) peaks, I care when we run out, which we won’t because, as production declines, prices WILL rise. As prices rise, people WILL figure out alternatives. They might not be happy alternatives. They might not be as productive alternatives. They might not support the same lifestyle to which we are accustomed. But there WILL be alternatives, forced by higher prices–and no other mechanism is that powerful.” [4]

Having read a fair amount on this subject over the past couple of years, I’m all for easy, simple, obvious, quick, inexpensive solutions that will allow me and everyone else to get our financial feet back underneath us and then proceed merrily along without worrying about energy or lifestyles or where I live or how I live or what I drive or what I own or what I use or anything else in my life that is impacted in some manner by oil. (Come to think of it, that would cover just about everything, but let’s not worry about that now.)

This cornucopian view that somehow, magic technology is somehow going to ride to the rescue and supplant the oil-based energy needed for production, delivery, and consumption of goods (i.e., almost everything we use) with some other alternative just because the price of oil has risen too high is an exercise in hope which at my most optimistic I cannot fathom! (In the interests of accuracy and fairness, and since I am entirely unfamiliar with that author, who prefaced his comments by stating that it was time for some “snark”, he may have been yanking his readers’ chains. However, his statement relying on pricing as the trigger to implement a non-existent Plan B for energy supplies is a common argument by those who think that basic market and economic fundamentals are going to save the day.)

In last Monday’s post, I provided a very short list of goods that are in some manner dependent on fossil fuels for their very existence. There are thousands more, and there are almost no aspects of our infrastructure (roads, bridges, train tracks, water and sewer pipes, power lines, etc.) that are not likewise dependent on fossil fuels for their production, delivery, use, or maintenance. We’re talking about years’ or decades’ worth of design and testing and marketing and feasibility studies and modifications and re-design and on and on and on, and for the simple expediency of higher oil prices we’ll just instantly transform everything over to some as-yet-undefined-and-untested-and-even-unknown “alternative”? Seriously? We’re just going to “figure out alternatives” just like that? Might there be a bump or two along the way? I’m thinkin’ that’s gonna be at least a couple weeks o’ work. Ya think?

“[T]he cold, hard, inconvenient truth is that trillions of dollars have been invested in the existing energy infrastructure, which provides consumers with electricity, gasoline, jet fuel, and myriad other commodities. Changing that infrastructure—nearly all of which has been built upon fossil fuels—to a system based on renewable and alternative energy will take decades.” [5]

A fact or two that just might be worth contemplating … if you happen to be one of those people for whom facts matter, that is.

NOTE: With the holidays upon us, this will be my last planned post until the first week of January. Happy holidays to all!

Sources:

[1] http://www.nytimes.com/2010/12/09/business/global/09iht-m09boil.html; As Days of Easy Oil Fade in Middle East, Firms Turn to Newer Techniques By SARA HAMDAN

[2] http://www.emirates247.com/news/region/saudi-oil-analyst-disputes-high-supply-theory-2010-11-10-1.315931; Saudi oil analyst disputes high supply theory

[3] http://peakoil.com/publicpolicy/wikileaks-reveals-hushed-concern-over-tar-sands-oil-in-us-state-dept/; Wikileaks Reveals Hushed Concern Over Tar Sands Oil in US State Dept.

[4] http://www.env-econ.net/2010/12/peak-coaler-just-doesnt-have-the-same-ring-but-i-bet-it-raises-the-same-vitriol-for-stupid-economist.html ‘Peak Coaler’ just doesn’t have the same ring, but I bet it raises the same vitriol toward stupid economists by Tim Haab

[5]: From the book Gusher of Lies: The Dangerous Delusions of Energy Independence by Robert Bryce (p.44); publisher: PublicAffairs (Perseus Books Group)

A few more thoughts on the heels of Monday’s post.

In a recent article on energy, climate change, and sports, Amanda Little shared an anecdote about an iconic National Football League team.

“The new Dallas Cowboy’s stadium, for instance, is an energy-guzzling Colossus averaging $200,000 in monthly utility bills and consuming about as much power as Santa Monica, California. (A conventional scoreboard, on its own, can devour as much electricity annually as 100 homes.)” [1]

Can we really continue to afford to think that this kind of energy excess can and will continue? Is that level of energy usage of greater priority or importance than powering neighborhoods? The truth we need to come to terms right about now is that absent some magnificent new discovery that comes into play very quickly and successfully, we may find ourselves having to make some painful determinations about energy consumption priorities that will have ripple effects in many aspects of everyday living—commercially and personally.

As has been noted by a number of bloggers and organizations, the International Energy Agency has now stopped dancing around the issue and finally admitted that Peak Oil was reached back in 2006. One of its prominent officials has once again indicated that “the era of cheap oil is over.”

Consider just a few more facts on the ground: exploration (deep water or tar sands, anyone?) and production has become more difficult and certainly more expensive, to say nothing of the resource quality. The primary exporters of oil are experiencing increasing domestic demand, and so naturally they are keeping more oil for their own national use. Hard not to understand that that just means less for everyone else. The majority of large producing oil fields are experiencing an inexorable decline in production. A poor worldwide economic environment has restricted investment in exploration and production, and there quite clearly will not be a ramp-up quickly or inexpensively. China is leading the way in higher demand for oil. On and on it goes….

These and many other frequently-discussed factors are going to have an impact soon if that process hasn’t already started. The situation simply is not going to get better, as disheartening as that may be. We’re all going to have to recognize a different set of rules about fossil fuel availability and consumption.

While alternative energy development is a primary source of hope, David Fridley’s excellent chapter in The Post Carbon Reader: Managing the 21st Century’s Sustainability Crises [2] has pointed out some very important limitations that need to be recognized and appreciated.

Mr. Fridley offers this important consideration:

“Alternative energy sources will need to form the backbone of a future energy system.
“That system, however, will not be a facsimile of the system we have today based on continuous uninterrupted supply growing to meet whatever demand is placed on it. As we move away from the energy bounty provided by fossil fuels, we will become increasingly reliant on tapping the current flow of energy from the sun (wind, solar) and on new energy manufacturing processes that will require ever larger consumption of resources (biofuels, other manufactured liquids, batteries). What kind of society we can build on this foundation is unclear, but it will most likely require us to pay more attention to controls on energy demand to accommodate the limitations of our future energy supply. Moreover, the modern focus on centralized production and distribution may be hard to maintain, since local conditions will become increasingly important in determining the feasibility of alternative energy production.” (p.13)

And a few more “for instances” from this terrific piece that we need to keep in mind about our supposed Alternative Energy Knight In Shining Armor:

“… —alternative energy depends heavily on specially engineered equipment and infrastructure for capture or conversion, essentially making it a high-tech manufacturing process. However, the full supply chain for alternative energy, from raw materials to manufacturing, is still very dependent on fossil-fuel energy for mining, transport, and materials production. Alternative energy faces the challenge of how to supplant a fossil-fuel-based supply chain with one driven by alternative energy forms themselves in order to break their reliance on a fossil-fuel foundation.” (p.3)

“Closely related to the issue of scalability and timing is commercialization, or the question of how far away a proposed alternative energy source stands from being fully commercialized. Often, newspaper reports of a scientific laboratory breakthrough are accompanied by suggestions that such a breakthrough represents a possible “solution” to our energy challenges. In reality, the average time frame between laboratory demonstration of feasibility and full large-scale commercialization is twenty to twenty-five years. Processes need to be perfected and optimized, patents developed, demonstration tests performed, pilot plants built and evaluated, environmental impacts assessed, and engineering, design, siting, financing, economic, and other studies undertaken.” (p.5)

When you add to that mix the fact that alternative energy supplies are currently inconsistent in terms of availability, and are much less efficienct than fossil fuels (i.e., we’ll need even more alternative energy to do what lesser quantities of oil provide)—among other factors Mr. Fridley takes great care to inform us of, we do not have adequate solutions/replacements in place.

There are no magic alternatives out there in Energy Solution Land that we can just drop in to our homes and industries and automobiles overnight and then just carry on without so much a single hiccup of interruption or inconvenience. (For all the good that electric vehicles offer, let’s not forget that we do not have the kind of infrastructure in place that will enable us to power an entire new generation of replacement vehicles—at least not without using considerable amounts of fossil fuel-burning power plants to power them up and keep them powered up.)

While our understandable preference may be to just bull our way forward on a blind assumption that something will come to the rescue, reality suggests otherwise. A broader understanding and awareness is called for—notably among and by our political leaders—but so too must the rest of us begin to recognize what looms on the horizon. Peak Oil does not mean our comfy little worlds are going to collapse next week or even soon (however we prefer to define that), but the reality that we’ve now maxed-out worldwide oil production and will never exceed those levels means we’re on the downside of availability.

Everything that we’ve come to rely upon oil for (in other words, pretty much everything), is going to be impacted. And that means we’re going to be impacted. The more of us who appreciate the challenges, the more intelligent our choices will be to plan for the needed adaptations.

We clearly cannot and must not be confident that a limited few will always act in the best interests of the majority. Congress has done a magnificent job of assuring us of that fact. But relying on our government is a necessity nonetheless.

“The Federal Government has many instruments that it can use to accelerate the creation and implementation of new energy technologies. These include research support, technology development, tax and other financial incentives, procurement, technology demonstration and deployment, regulation, standards development, knowledge dissemination, intellectual property protection, public-private partnerships, Federal-state coordination, support for education, immigration law, and international agreements. These instruments involve the responsibilities of many different Executive Branch agencies and Congressional committees. In the past, many actions taken by different administrations and congressional entities have been at cross-purposes with regard to their effects on energy technologies.” [3]

So while we face the daunting challenge of relying on national leaders to articulate our energy priorities and strategies as Peak Oil’s impact becomes more pronounced (leaders who by and large have demonstrated remarkable unanimity in failing to discuss the truths about what we face, by the way), another daunting truth is that much of what will actually be done to deal with the consumption changes will originate at the state, regional, and local levels. While I believe we must have some national objectives in mind, we cannot disregard the importance of bottom up input and expertise.

Soon enough it is not going to matter what your philosophy about governance is, or if deficit-spending is a greater burden than failure to spend, or if the Right is collectively more insane than the Left. We’re going to have to move above and beyond those ultimately petty ideological concerns and develop and deal with real-life implications of a society that it going to have its industrial design and production and transportation systems—and eventual consumption by end-users—all provided and sustained by something other than unlimited amounts of fossil fuels. It will indeed be a whole different kind of world we’ll live in.

While there are clearly some rather imposing challenges and issues, the question ultimately boils down to this: do we allow the challenges to defeat us, or do we recognize the magnitude of what faces us and rise up to seize the opportunities? We’re in due course going to have no choice but to restructure and revise and refine and re-create the industrial support system that has supplied us with our remarkable levels of prosperity for more than a hundred years, as well as doing the very same thing for the lifestyles we currently enjoy.

We must recognize that this will of course lead to different outcomes (we’ll have no choice in that), but that does not necessarily equate to “bad” outcomes. Life is going to be different, and the sooner we come to terms with that truth the better off we’ll be as we begin the process of adaptation and the creation of new strategies and new systems of production and usage. The most optimistic person on this planet cannot expect this to occur in anything less than many years—many years that will pass with less and less of the energy resources that brought us all to this moment. We do have our work cut out for us.

Are we up to the task?

Sources:

[1] http://blogs.forbes.com/amandalittle/2010/11/15/can-professional-sports-do-more-than-politics-to-save-the-planet/; Can Professional Sports Do More Than Politics to Save the Planet? November 15, 2010
[2] http://www.postcarbon.org/report/127153-energy-nine-challenges-of-alternative-energy; The Post Carbon Reader Series: Energy – Nine Challenges of Alternative Energy By David Fridley, p3-4 [Excerpted from The Post Carbon Reader: Managing the 21st Century’s Sustainability Crises, Richard Heinberg and Daniel Lerch, eds. (Healdsburg, CA: Watershed Media, 2010 - http://www.postcarbon.org/reader)
[2] http://www.whitehouse.gov/sites/default/files/microsites/ostp/pcast-energy-tech-report.pdf; REPORT TO THE PRESIDENT ON ACCELERATING THE PACE OF CHANGE IN ENERGY TECHNOLOGIES THROUGH AN INTEGRATED FEDERAL ENERGY POLICY by the President’s Council of Advisors on Science and Technology, November 2010 (p19).

In a number of prior posts, including my post from earlier this week, I have tried to impress upon readers of this blog the urgent need for planning. In a future world that was once created, maintained, and enhanced by fossil fuel resources at every step, we’re going to have to devise means and methods to achieve many of the same functions without oil to sustain the efforts. That is no easy task.

Certainly we will help the cause by paying attention to our energy usage and by finding ways to conserve, starting right now. Every measure will help. If we don’t have the basic energy resource (oil) available to us to power our industrial economy in all its facets, then obviously “alternative” energy resources will have to step in as substitutes.

There’s one serious problem: we don’t have alternative energy resources anywhere near the quality, quantity, or scale to serve as an appropriate substitute. That’s Gigantic Hurdle Number One, and we’re not going to clear that bar any time soon absent a legitimately miraculous discovery in the near term; or a massive, nation-wide commitment to make the transition away from our oil-powered economy—with all the research, design, testing, implementation, and sacrifice that entails. The latter is very likely the one we’ll have to depend on, sooner or later. Sooner is the better option.

As mentioned in my last post, as have others, the Hirsch Report was quite clear that mitigation efforts designed to transition away from oil as the foundation of economic growth and industrial production required an all-hands-on-deck twenty year process. With Peak Oil now, apparently, a few years past already, we’ve got a calendar problem. Those mitigation efforts would have had to begin about a quarter of a century ago. Turning back the clock has never been an option, and it’s not available now, either.

“Achieving any really significant percentage of renewable energy contribution to current consumption levels appears to be next to impossible. Current efforts to try and achieve this impossible target require ever more massive and complex machinery and higher and higher inputs of, increasingly scarcer materials and fossil energy to achieve.
“The point is very simply that an enormous amount of fossil energy is required to manufacture, install and operate all forms of renewable energy systems. Without the input of fossil fuel the existing renewable energy projects could never have been built and could not be maintained in operation.” [1]

Worldwide discovery of oil peaked more than three decades ago. Every year since, we have been using a lot more oil than we’re finding. Spin that any way you’d like, it’s still bad math. Approximately two-thirds of the countries producing oil (including the U.S.) have now—or long ago—reached peak production. That math doesn’t work any better.

As the remaining major oil producers continue to expand their own economies and serve their citizenry, the amount of oil they will have left over to only then export to countries like our own will decline. Whatever sense of entitlement we might insist upon won’t be worth much when that reality intrudes. That’s a grand social psychology problem we’re not close to recognizing. We’ve always gotten whatever we need … sometimes just because we wanted “it.” There will be a lot of whining and complaining in the years to come when the realization dawns on us that “just because” is no longer good enough. The citizens of the world have every reason to expect or desire growth and prosperity for themselves. And I don’t foresee the peoples of developing nations deciding en masse to forestall progress so that Americans can continue to gorge themselves at the world’s expense. That may not be a happy message to receive, but it’s an honest one.

And let’s not forget that finding and producing the same quality and quantities of oil that has sustained us to this point is only going to be more difficult; which of course also means more expensive. Oil producers won’t be absorbing those higher costs out of the goodness of their hearts, either. We’ll be paying for that.

But so far we have no strategies to address these real-life consequences of peak oil production. The ones we are employing (because we have no alternatives), make less sense as time passes.

“What is crazy and wasteful is that the U.S. and other countries are still building car assembly plants, roads, highways, parking lots, suburban housing developments, and airplanes as though cheap oil will last forever (Brown 2009). We continue to make investments in an infrastructure that will be superfluous shortly after we build it. This is an example of a market that is failing because it does not anticipate even short-term changes.” [2]

What’s a better approach, as we continue to seek ways to pull ourselves out from the depths and burdens of this ongoing Great Recession (and no, tax cuts for the wealthiest few hundred among us really is not the solution)? Perhaps our national leaders might consider the opportunities to redress the myriad infrastructure repair and maintenance issues with an intense focus on adapting that infrastructure to a world where fossil fuels are no longer available to power or sustain it—and us. Relying on the normal resources is painfully short-sighted now. Certainly a reliance on hands-off government for an undertaking this complex is pointless to argue or consider. An unfettered corporate world cannot begin to handle the myriad aspects of this nearly-incomprehensible conversion.

More planning might be a good idea right about now, before we throw money and fossil fuel resources at problems that desperately require our attention.

Other nations, notably China, seem much more capable and willing to prepare themselves for a new energy culture than we are. That’s a problem now, and it’s going to become an even greater and more pervasive problem for us down the road unless we start getting our national act together. But no one wants to take that first giant step to explain to Americans that we’ve got a brewing challenge ahead, one that will too quickly morph into a crisis unless we start doing things differently … now.

“‘China right now is preparing to roll out electric cars, lithium ion batteries, solar cells, cellulosic ethanol. This is where the future of energy is. We’ve a finite resource in oil, just like we had a finite resource in whale oil, and we made a transition,’ said [Rep. Jay Inslee (D-Wash.)]. ‘And we have to really focus our national energies in a bipartisan way, I would hope, on finding our way to compete with China to really build new energy sources of the future.’”

“President Obama has made a similar case repeatedly in recent years, stressing the fact that countries like China and India ‘aren’t playing for second place.’ There’s a gut-level appeal to messages like these, at least there might be, targeting a certain nationalistic impulse — advancing America’s interests isn’t just about a debate over the size of government, it’s also about positioning the United States as a world leader in a competitive landscape.” [3]

The opportunities are still there, daunting though they may be. But unless and until we come to some national recognition about what the real world is going to be like for all us—Republicans, Democrats, You-Name-Its—we cannot hope to prepare ourselves for the massive changes that will confront us in the years ahead. Can we still lead? Will we?

The song remains the same: crisis, or opportunity?

Sources:

[1] http://www.energybulletin.net/stories/2010-11-25/how-sustainable-renewable-energy; How sustainable is renewable energy? by Roger Adair
[2] http://sustainability-ayersj.blogspot.com/2010/11/peak-oil-3-national-and-global.html; Peak Oil 3: National and Global Production Peaks of Oil and Other Resources by John Ayers
[3] http://www.washingtonmonthly.com/archives/individual/2010_11/026813.php; THE GLOBAL-COMPETITION ARGUMENT by Steve Benen