Peak Oil/Hydrocarbon Depletion: alarmist nonsense or reasonable concern?

The tar sands in Canada, shale oil in the US, super heavy oil in Venezuela, ultra deepwater fields in the Gulf, etc. All of these are signs of peak oil. You don't go to these places until you've used up all the good stuff, the low-hanging fruit.


Well since the price of oil has skyrocketed these options have become feasible. It's all about increasing revenue for these oil companies. I think you've bought too much into what the oil companies are selling. These companies have failed to invest in R&D for way too long, they really had little incentive to do so. Now that China and India's demands have risen they're selling this sap story about there being no cheap oil to meet everyone's needs. But we know there are a number of nations with cheap crude that are producing way below their capacity (ie. Iraq and Libya). Prices are artificially high and these oil companies want to make sure they make the most of it. At this point because of poor drill bit technology exploration has been limited to certain depths and locales. An improvement in this in itself will make a world of difference.

BTW I think solar energy is the future, solar panels have been consistently doubling in efficiency every 5 years. (I believe I read that in The Economist)

 

Looking back 25 years ago at reserve figures, you would figure that we'd be pretty darn close to running out of oil. But we are not. So you can see the past 7 years or so world oil production has been flat at around 82 million barrels per day. But even that is not the first time in history that oil production has been flat.

Cheap oil is gone. It takes years to completely develop off-shore fields. The last great oil field discovery was in off-shore Iran in the early 2000's. Even with that discovery production has yet to significantly increase. In 3 to 4 years from now there may be another spike in demand, an increase in price.

It will have very little to do with production decreases but the higher prices may lead to higher production rates as unconventional reserves are produced.

 

I work in the oil industry peak oil is straight BS. The technology has gotten much better and what you couldn't do even 15 years ago you can do now.

 

There is a lot of oil subsea. Like enough to make 13 million barrels a day. Little more difficult to get to, but potentially as much as Saudi.

 

This is true, but most voters don't know the difference, nor do they care, and their ignorance is used against them by big oil and a lazy corporate media.

 

Brazil is sitting on a Saudi-sized lake underneath the ocean.

 

You mean this?

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

Nope, those type of discoveries aren't going to allow us to keep living the way we do.

 

I can't remember the source now. Maybe Greg Palast. The original report on Peak Oil, decades ago, was written by a guy hired by Shell Oil. Vanishing resource = keep the price high.

 

I don't know if we should be living the way we do, anyway...but seems like these sorts of discoveries would allow for an extension of that.

 

What difference does it make? It's the CO2 that'll kill ya.
It's the sea level that will inundate your civilization.
Chinese coal plants are probably the death of us.

The higher and better use of the resource is not burning it. It's making stuff out of it, that can be recycled, forever. (they're just not making dinosaurs like they used to)

But I do like my car. varooooom.

 

Don't bother asking about the drill bit, I was completely wrong. I've got a couple family members who are petroleum engineers and I had a discussion with them about this. I had thought one of them told me that poor drill bit technology was a problem. My bad.

 

http://www.economist.com/node/21534794

Big Oil’s bigger brothers

BUSINESS could scarcely be better for the supermajors, as the world’s biggest listed international oil companies are known. A barrel of Brent crude has changed hands for $100 or more for most of the year and cash is gushing in. On October 25th BP announced quarterly profits of $5.1 billion. Two days later Shell reported profits of $7 billion and Exxon Mobil of $10.3 billion. But the tide of the oil business is turning.

Half a century ago life was simple for the world’s oil giants. Countries with lots of oil often lacked the technology, capital and management skills to find and extract it. Western oil firms supplied all of the above, and did rather well out of it. But then OPEC was born, and petrostates started their own state-backed national oil companies to take charge of their reserves.
State-backed firms now dominate the business. Exxon may be the world’s biggest listed company by market capitalisation, but it is a tiddler beside the National Iranian Oil Company or Saudi Aramco (see chart). Measured by the reserves it controls, it is only the 11th-largest oil and gas firm in the world. Shell and BP scrape into the top 20. State-backed firms control around 80% of the world’s oil.

Obviously, private oil companies have to work with the national giants. But the state firms are often unreliable partners. If the government suddenly turns nasty, as in Venezuela, contracts can be torn up and private oil firms sent packing. In some other cases, the state oil firm is simply incompetent—many are expected to provide sinecures for politicians’ useless nephews. After the huge Kashagan oilfield was discovered in 2000 in Kazakhstan, Exxon, Shell, Total, Eni and ConocoPhillips all jumped at the chance of working with the Kazakh state oil company. Billions of dollars later, the field has produced delays and arguments but no oil.

Not all state oil firms are badly run, however. And the smart ones are arguably a bigger problem for the supermajors, since they are muscling onto their turf. They have pockets deeper than any well. And after years of working with the supermajors, their technical expertise is growing. Norway’s Statoil is a match for almost anyone. Brazil’s Petrobras is developing its own technologies to exploit ultra-deep water. Both are forming partnerships with other state-backed firms.

As if that were not trouble enough for the supermajors, they also face competition from smaller private companies. Oil-service firms, the ones that supply rigs and technical support, are starting to broaden their horizons. A few are offering “full-service” contracts, aping the approach of the supermajors. Some, such as Petrofac, are taking stakes in oilfields too.

State firms that don’t control domestic reserves, such as those from China and South Korea, are bidding for licences that once would have been regarded as on the supermajors’ turf. These firms have patient shareholders who see oil as a matter of national security rather than a source of profits. In 2010 China’s CNOOC bought a stake in Chesapeake Energy. The deal gave it not only access to the Eagle Ford shale in Texas but also better technology to extract unconventional oil and gas from recently discovered shale beds back home in China.

Even utilities are joining the scramble. Most of Europe’s big power companies have bought stakes in upstream oil and gas businesses, though for now they are doing so in partnership with supermajors.

With oil prices high, the scramble to pin down reserves is vicious. Supermajors and state firms vie to buy small independent oil and gas firms for their fields and drilling licences. And when it comes to discovering new barrels, the supermajors find that smaller and nimbler firms (such as Britain’s Tullow and Cairn and America’s Anadarko) are often better at it. In years gone by the supermajors would typically find four or five of the largest new oilfields every year, says David Branson of Booz and Company, a consultancy. Now they discover one or two. On October 25th Exxon said it had struck oil and gas off Vietnam; it was not clear how much.

Supermajors are still needed

Not all is gloom for the supermajors. Their cash and technology are still in demand. Middle Eastern oil firms such as Kuwait Oil Company, Abu Dhabi’s ADNOC and even Saudi Aramco, though technically quite advanced, still need help, particularly in refining and other downstream activities. And newer petro-states such as Uganda and Ghana need lots of help. Their first priority is not technology transfer but reliability. They may prefer to do deals with firms with a long track record of funding and managing big projects from start to finish. That favours the supermajors.

Because oil is so expensive, it makes sense to pump it from difficult places. That too gives an edge to the supermajors. For all Petrobras’s efforts, the supermajors still have the best technology for finding and extracting oil from harsh environments such as the Arctic or deep oceans, and from unconventional sources such as oil sands.

The supermajors also have an advantage over smaller firms when it comes to the biggest and most capital-intensive projects—such as huge liquefied natural gas (LNG) projects. Examples include Prelude, Shell’s mammoth Australian floating LNG facility, and the Shtokman gas project, in which Total and Statoil are helping Gazprom, Russia’s state-backed gas firm.

As the quest for oil intensifies, supermajors will probably take on more risks, both political (tie-ups with dodgy regimes) and geological (investing billions to extract hydrocarbons the Earth is reluctant to give up). They are already doing a fair bit of both. Even Exxon, renowned for its capital discipline, has struck riskier-than-usual deals in the Arctic and the Black Sea with Russia’s state oil firm, Rosneft.

Life is getting harder for the supermajors. Their edge over their rivals—the ability to extract oil from difficult places—is terrifically useful while prices are high. But since it is terrifically costly to extract oil from difficult places, their competitive advantage fizzles if oil prices fall. If it does, their bumper profits could vanish like a pool of petrol into which a lighted match has been carelessly dropped.

 

Oil is naturally produced in the earth's mantle -- we're not going to run out of oil, but days of the easy wells are going away. There will always be oil the deeper we drill and this tech is only going to improve.

 

Based on the evidence, I've found this explanation the most plausible.

 

I see it as if its finite, its going to run out (obviously) which means there WILL be future generations who do NOT have it. No one is guaranteed a life with oil. So might as well use it all and hope its not US that need to deal with the fallout. And whoever got to use the oil in Earth's history got to live the charmed life.

BUT there's the big issue of CO2's killing the Earth and humanity with it.

If there's one thing a business doesn't like, its going completely OUT of business. THEORETICALLY, oil companies and coal plants will have little choice but to get into alternative energies if it wants to stay in existence. Though by then everyone's shortsightedness will have done too much irrecoverable harm to the planet