"Peak Oil".. Is Anyone Familiar with it?

Hey, I saw this on fark a couple of days ago.

It's a lot of material to wade through.

This is actually discussed at length by environmentalists in some places as well but in a different context - why should we reduced our dependency on oil - not because we'll run out but because our end costs are not the true costs to society, etc.

I was under the impression that there's plenty of oil that is not economically feasible to recover at current prices of 20-30/barrel that will be economically feasible to recover at 40-50 and so on. The question is : what happens to Western industrialized nations at that price point?

 

No. They've said for the past gazzillion years that we are going to run out of oil, there is only a 10-year supply. Nobody really knows. But with increased technology, we can drill for more of the oil than ever. When the day comes that oil is no longer our main source of energy, the market will find a solution. It always does. Have faith.

 

Even that can change, though. There were a whole mess of wells that were shut down because the technology at the time didn't allow for a cost effective recovery, or the companies that ran the wells at the time didn't have the economies of scale to pull the oil out of the ground and sell it at a price notably higher than their cost. Later efforts have allowed some of those wells to become producers again based on either new technology or other cost-savings methods.

 

This is an excellent topic. A few points:

Obviously the Iraq 'war' concerns oil. There are other nuances, however, than the US's physical control of the spigots. This is illuminating:

http://www.phonono.com/NotaboutOILORIRAQ.html

Some people would argue that the earth has passed the point of peak oil. Whatever the case, there are any number of people who are passionate on the subject. This gentleman seems to me to be a good starting place:

http://www.fromthewilderness.com (Some paid content - search around by keyword to find free material)

With this article a good primer:

http://www.fromthewilderness.com/free/ww3/100203_cnn_peak_oil.html

Talk radio types will leap up and declare these sources unhinged and incredible. They'll assure you that the US presence in Iraq is to depose a madman, etc., and that you should never fear, you know, we'll figure out a way to squeeze enough oil out of vapor in 30 or 40 years to continue to fly huge jets around the globe, tie up freeway traffic, and otherwise consume fossil fuels at our ever expanding rate.

I'll leave it to you to determine respective credibility.

 

The author of that article often takes speculation for fact and chooses the worst possible outcome with every situation to achieve his hypothesis.

Of course, he may be right. Just because it's unlikely (and easily dismissable as "alarmist") doesn't mean it won't happen. Anything can happen, and the author certainly makes an interesting case. Fact or fiction, his "peak oil" scenario is bone-chilling.

Oil propels American civilization -- it's used in almost every product or service available. Without cheap oil, our civilization would literally crumble. There's no way for renewable energy to "take over" if oil suddenly runs out. Because of our disturbing short-sightedness, the infrastructure simply isn't there. That's a scary thought.

Scarier still, we have entrusted our precious lifeblood to a capitalistic system that has allegiance to nothing but private profit. In a way, that's even scarier than the doomsday prophecies of the author.

Maybe nothing will happen, and we'll enjoy cheap oil for the next million years. But if this "peak oil" scenario is even remotely possible (and it seems to be, though timelines are impossible to know) -- it's time to ask some big questions.

 

Thanks for bringing the peak oil question to my attention. I remember the Club of Rome reports from 30 years ago. What is interesting is that the major trouble is not that the oil actually runs out but that it becomes so expensive that our economy and therefore our lifestyle and culture could be in big trouble.

This is an important issue and should not be merely a "left" or "right" issue.

This is the type of issue that should be required discussion at all universities.

 

http://msnbc.msn.com/id/4287300/

Crude Awakening
A prominent physicist warns in a new book that the world is running out of oil and we’re not doing anything to stave off the coming crisis

WEB EXCLUSIVE
By Brian Braiker
Newsweek
Updated: 3:47 p.m. ET Feb. 17, 2004Feb. 17 - Remember 1973? If you do, there are plenty of reasons to wish you didn’t. Chief among them (right after leisure suits) would be the oil crisis that began in October. The Middle Eastern OPEC nations stopped exports to the United States and other Western nations just as stateside oil production was peaking. The artificial shortage that followed had devastating effects: The price of gas quadrupled in the United States, climbing from 25 cents to more than a dollar, in a matter of months. The American Automobile Association reported that in one isolated week up to 20 percent of the country’s gas stations had no fuel; in some places motorists were forced to wait in line for two to three hours to gas up. The number of homes built with gas heat dropped.

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But that was the 1970s and this is now, right? Not according to David Goodstein. Saudi princes and SUV drivers may do well to read his new book, “Out of Gas: The End of the Age of Oil” (W.W. Norton), in which Goodstein argues that our oil-dependent civilization is in for a crude awakening when the world’s oil supply really begins to run out—possibly within a few decades. “As we learned in 1973, the effects of an oil shortage can be immediate and drastic, while it may take years, perhaps decades, to replace the vast infrastructure that supports the manufacture, distribution, and consumption of the products of the 20 million barrels of oil we Americans alone gobble up each day,” he writes.

Goodstein’s book is not a happy read, but an important one. In layman’s terms, he explains the science behind his prediction and why other fossil fuels might not do the trick when the wells run dry. Goodstein, a physicist and vice-provost at the California Institute of Technology, recently spoke with NEWSWEEK’s Brian Braiker about the fundamental principles of oil supply and demand, and whether civilization can survive without fossil fuels. Excerpts:

NEWSWEEK: This is scary stuff. You’re saying that oil production will soon peak.

Neil France
David Goodstein says facing up to the coming oil crisis is ‘hard and we’re not trying’
--------------------------------------------------------------------------------

David Goodstein: The prediction that it will peak—that is to say the crisis will come when we reach a peak when half the oil has been used up—that prediction quantitatively is unquestionably true. But the quantitative question of when the peak will occur depends on extremely undependable numbers. The so-called proven oil reserves as reported by various countries and companies around the world are often just guesses and they’re often not even honest guesses. Among those who would analyze those figures, some have predicted that it will come as early as this year; others, within this decade. It could possibly be in the next decade. But I think that’s about as far as you can push it.

Let’s start at the beginning. What is oil and what do we use it for?
Oil is hydrocarbons that grew up in the earth when source rock full of organic inclusions sank to just the right depth—not too little and not too much—and got cooked over the ages. It took hundreds of millions of years for the world’s supply of oil to be created. The oil is used to make gasoline obviously, but also home heating oil, diesel fuel but also 90 percent of all the organic chemicals that we use. That includes pharmaceuticals, agricultural products, plastics, fabrics and so on. They are petrochemicals, meaning they originate as oil.

So our demand, regardless of supply, is unlikely to decrease anytime soon.
Well, the need for those hydrocarbon materials has been increasing for 150 years and will go on increasing especially because the world’s population is increasing. The poorer parts of the world want to increase their standard of living, which inevitably means using more energy. Fossil fuels are our principal source of energy.

You used an interesting word: “need.” Do we need the oil or is it something that we have just become dependent on?
We have certainly become dependent on it. This is a habit that will be very, very difficult to break.

Knowing human behavior and how hard the habit is to break, we probably won't, in all likelihood, break it.
I think we will not. One of the reasons I wrote the book was in the hope that enough people will become aware of the problem and we will be a little better prepared.

How do you suggest people prepare now?

Right now we don’t have the kind of leadership that would take us in the direction that would make major changes. As individuals we can do things; I drive a hybrid car, for example. But as a society we have to redesign cities so that people live close to where they work. There are all kinds of measures. We are so profligate in the use of energy that even with the smallest effort we can reduce the rate at which we use energy very significantly, as Californians showed after the last energy crisis. But what we really need is massive infusion of research on all of the possible ways of ameliorating this problem.

You’re talking about researching fusion and fuel cells and —
Fusion, fuel cells, biomass. There are all kinds of possibilities, but none of them are worth a thing unless you’ve shown that it actually works. You’ve got to prototype it; you’ve got to show that it can be scaled up, that it can be done on a large scale. And so on.

You write that the crisis doesn’t happen when we run out of oil, it happens when we reach the peak, the halfway point. Explain that.
We had a peak once before—it was in 1973. The production in North American had reached its peak in 1970 and was declining. Supplies were not available in North America and the Arab countries embargoed the oil; they shut down the pipeline. We had an immediate, instantaneous panic, mile-long lines at gas stations and fear for the future of our way of life. That was an artificial, temporary peak. And it’s just a slight foretaste of what will happen when we reach the real [global] peak and supplies start to decline and continue to decline forever.

So what happens then? Do we revert to coal?
It’s possible for us to revert either to natural gas or to coal or both. Among consequences are the increasing global climate change. But another consequence is, let us suppose you tried to substitute coal for oil. Natural gas is a good substitute and it will last for a while but it will have its own peak one or two decades after oil, so it’s only a temporary solution. If you turn to coal, we’re now using twice as much energy from oil as we are from coal. So if you want to liquefy coal as a substitute for oil in transportation—which is its most important application—you would have to mine coal at a rate that’s many, many times at the rate of what we’re doing now. But the conversion process is very inefficient. So you’d have to mine much more than that. If you put that together with the growing world population and the fact that the rest of the world wants to increase its standard of living, you realize that the estimates that say we have hundreds of years worth of coal in the ground are wrong by a factor of ten or more. So we will run out of all fossil fuels. Coal will peak just like any natural resource. We will reach the peak for all fossil fuels by the end of the century.

You mentioned transportation as one of oil’s greatest uses. Doesn’t alternative technology already exist?
Not exactly, no. We tried electric cars and that was sort of more or less withdrawn from the market. I think there was plenty of demand. But when I tried to buy an EV1 some years ago, they said that the car had a range of 50 to 100 miles, but there was an onboard computer that always told you what your range was and when it was freshly charged, it had a range of about 30 miles. And they only sold them in California and Arizona because they were useless in colder climates. So that’s not the solution. There are advanced batteries—the kind of batteries that we use now in our cell phones and laptops are lithium ion batteries and they have about five times the energy density of the old lead acid batteries. So if you could imagine something like and EV1 with five times the range, that starts to become believable. But nobody is showing that you can scale up the lithium ion batteries to use in transportation.

And another alternative is nuclear.
Nuclear is an alternative, but remember you’re not going to have any nuclear cars and nuclear airplanes. Nuclear is not a substitute for oil. There’s a lot of talk about hydrogen because of the president’s initiative—the governor of California has also announced an initiative. I think what people don’t understand about hydrogen is that it is not a source of energy. You have to use energy to make hydrogen—it’s just a way of storing and transporting energy. And with today’s economics and today’s technology, it takes the equivalent of six gallons of gasoline to make enough hydrogen to replace one gallon of gasoline.

How do we know that all the oil that will be discovered has been discovered?
We don’t know that all the oil that will be discovered has been discovered, and this is a somewhat controversial subject. But we do know that the peak in oil discovery occurred decades ago. The rate at which we’ve been discovering new oil has been declining for decades. That’s one of the arguments that the peak in oil supply must be coming soon because the supply curve follows the discovery curve by a few decades. The United States Geological Survey conducted an exhaustive study between 1995 and 2000 and gave out a statistical output in which they said that the amount of oil that we started with, we could be 95 percent certain, was at least 2 trillion barrels. But they also thought there was a 50 percent chance that there was 2.7 trillion barrels. The difference between those two is 700 billion barrels of oil—that’s the entire reserves of the Middle East. They were predicting discovering the Middle East all over again. That’s pretty implausible. But if you really did add 700 billion barrels to the world’s oil supply, it would delay the peak by about a decade. So we’re not talking about really something that does away with the problem.

And opening up the Arctic National Wildlife Reserve in Alaska?
It makes no dent at all. It isn’t even worth talking about.

Is there a silver lining here?
I really don’t think so. If the peak comes and we can’t get our act together fast enough to make up for it, you will end up with people all over the world burning coal as fast as they can just for the space heating and primitive industry. And if you do that the effect on the climate is completely unpredictable.

What about solar energy?
Solar energy will be an important component, an important part of the solution. If you want to gather enough solar energy to replace the fossil fuel that we’re burning today—and remember we’re going to need more fossil fuel in the future- using current technology, then you would have to cover something like 220,000 square kilometers with solar cells. That’s far more than all the rooftops in the country. It would be a piece of land about 300 miles on a side, which is big but not unthinkable. But making that area of solar cells one heck of a challenge because all of the solar cells every made probably wouldn’t cover more than 10 square kilometers. This is not impossible. It’s just difficult. It’s hard and we’re not trying.

You’re a physicist by training.
This is not my research field. I do research in a completely different field. I just thought that this was such an important problem that somebody ought to write a book about it. I am not an expert—there is no subject covered in that book about which I know more than anybody else. If you want to know about superfluid helium or certain kinds of phase transitions I may know more than anybody else in the world. I just thought I should lend my pen to this cause.

Have people been calling you an alarmist? A doomsayer?
What people have been saying is ‘listen to what he’s saying. He’s not an alarmist.’

© 2004 Newsweek, Inc.

 

The capitalistic system you decry would find a solution to our energy needs if we ran out of oil. Capitalism is what makes us a wealthy nation and allows us to enjoy a standard of living far better than any nation. Most of our "poor" have automobiles and color TV's, whereas in Haiti people live on a dollar a day. I'm just tired of all this bellyaching about our capitalistic system, because it has done more to feed and clothe the world than Mother Teresa or a thousand liberals ever thought to do.

 

Here is one company's approach to this problem:

http://www.changingworldtech.com/
http://www.discover.com/issues/may-03/features/featoil/
http://news.nationalgeographic.com/news/2003/11/1125_031125_turkeyoil.html

 

What do you mean by "liberals?" Do you mean any group in particular or are you using the term "liberal" as a partisan pejorative?

As for the value of capitalism, it depends on where you sit. For many Americans, it is a blessing. For some preteen chinese girl in a tech factory, some Nigerian working for Shell Oil or some Mexican working for Ford Motor Company, capitalism isn't some grand savior.

 

Not necessarily.

Again, for the thousandth time; a pure capitalist laissez faire system is inherently inefficient and runs into huge problems when allocating common pool resources. That's not a theory, that's a fact, accepted by anybody with any background in economics, from communist to libertarian.

 

Of course there has to be some govt. to enforce a rule of law, protect the economy from outside aggressors and enforce some sort of reasonable enviromental law. I am not an anarchist. But anything more than that and govt. is more of a hinderance than a help. Excessive regulation makes it harder for entrepenuers to develop and market new products. When we have a dependant class that is addicted to handouts from the society's producers, that is a major problem. When we have a corporate sector that is also dependant on handouts, like big agriculture with those damned subsidies, that is also a problem.

And as for this "allocating common pool" resources business, what kind of socialist are you? That is such balderdash. I guess wealth is a zero sum game for you, right? The rich gobble up the pie and leave crumbs for the poor, eh? That is simply untrue. The market has solved more problems, cured more diseases, built more wealth, cleaned up the environment and saved civilization more than govt. ever thought to do. Without capitalism, we would be cruising around in 50 hp Trabants into a smog choked industrial sector being told where we can live, how much we can make and what we can do with our lives by a bunch of bureaucrats who are paid, like all workers in a socialist economy, to simply show up. Socialism is the enemy of excellence, creativity and freedom.

 

Capitalism works fine if you have people making rational decisions with a fair marketplace. Combine rising demand with falling supply. If we start running out of easily recovered oil rapidly the premise falls apart - the 1972 crisis was just a taste of that which we have to look forward to.

The turkey slurry thing sounds promising, getting rid of waste and producing energy.

 

No, you ninny. We've actually had this discussion before. The study of the allocation of common pool resources is a subgenre of economics based on the inefficiencies that result from private consumption thereof. (the "Tragedy of the Commons" scenario is the most well known example).

If you don't believe me, type the phrase into google and see how many hundreds of thousands of responses you get.

You'll find this branch of economics taught at most major univeristies by professors of all political persuasions, from libertarian on to marxist.

I learned about it from Richard Epstein. Do some research and find out how much of a socialist he is.

Guess you weren't paying attention before, huh? What a surprise. Stop being such a cartoon character, yosemite.

 

I disagree with that analysis, because the marketplace has always found a solution to an economic need. Cities became filthy because of the horse excrement dropped by all the horse-drawn carriages, so along came the car. Fedex vs. the US Mail is the prime example of govt. run inefficency vs. privately-run success. The marketplace has and will continue to solve problems, unlike the govt, which perpetuates them.

This whole "tragedy of the commons" proves the inadequacy of communal ownership of property because why give a crap about something if it belongs to everyone. So what if private property leads to "greed?" Greed is a ridiculous invention of the socialist mind to tar and feather those who would seek to make their fortunes. If someone wants to be rich, according to your thinking, it is always because something was taken from the poor, which is not true.

Nothing in this world is perfect and there will be some folks who are left behind, as a result of various circumstances. But since we do not live in a utopian perfect world, this will always happen. So what is your proposal, limit the wealth people can achieve, stifle creativity and invention and make us all economically equally miserable? It does not work!

If we run out of oil, someone will invent some new form of energy production or make an old one more efficient and cheaper. So going to bed worrying yourself on whether those surbanites you sneer at in their SUV's will suck up all of the world's oil is just ridiculous and pointless. The marketplace you tar and feather will save your ass and mine as well. So don't kill the golden goose with your beloved "taxes on the evil rich" and excessive regulation.

 

How about "Peak Natural Gas"?
http://www.christiansciencemonitor.com/2004/0219/p11s02-usec.html

from the February 19, 2004 edition

The escaping price of natural gas

By David R. Francis | Staff writer of The Christian Science Monitor

The United States is skating on the edge of another big jump in natural-gas prices this spring - perhaps even a shortage that, depending upon the weather and its severity, could leave residents shivering and cause some industrial customers to curtail operations.
Analysts describe the situation with varying degrees of alarm, from "shaping up for an unmitigated disaster" to "tight" on supplies. Last week, Alan Greenspan, chairman of the Federal Reserve, spoke of his "chronic concern" about how a sharp spike in natural-gas prices would affect the economy.




Most Americans would quickly feel the effects of a severe shortage - and subsequent price hike. Natural-gas utilities, with 64 million customers in the US, provide 24 percent of all energy consumed. Their gas heats and cools millions of homes, and increasingly is burned to generate electricity. Natural gas is both a fuel and a feedstock for the nation's $460 billion chemical industry with its 1 million employees.

"The problem is awfully serious," says Matthew Simmons, head of Simmons & Co. in Houston, an investment bank specializing in the energy industry. "It's shaping up for an unmitigated disaster."

Driving the concern are data suggesting that natural-gas production in the US is tumbling faster than anticipated. As a result, environmentalists, industry representatives, and others are marshalling their arguments about what needs to be done to stave off a crisis. Ideas range from pushing for greater conservation and efficiency to opening new areas for drilling to importing more liquid natural gas (LNG).

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Because of today's high gas prices, Mr. Lebedev says, America's chemical industry - one that has been the biggest and most competitive in the world for decades - has become uncompetitive and could be "gutted" in the years ahead.

"We are trying to stabilize the industry so it stays in the US," he says. Already, some global chemical firms have shifted production to countries where gas prices are lower
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Then there's the hydrogen proponents. Someone needs to tell them were *probably* running out of one of their proposed sources ( natural gas, see above article) of hydrogen so they don't go down a useless alley.


http://www.christiansciencemonitor.com/2004/0219/p15s01-stss.html

One step closer to hydrogen economy?

By Mark Clayton | Staff writer of The Christian Science Monitor

BOSTON – Wanted: A cheap, reliable power source to satisfy energy-hungry industrial superpower. Must also be pollution-free and provide energy security by being domestically abundant. Immediate opening.
While candidates like solar and wind have sent in their résumés, it seems hydrogen is the perfect match to fuel America's energy demands - right?


Well, maybe. President Bush touts a future hydrogen economy, while environmentalists decry it as a red herring to avoid addressing global warming today. But new research may add a fresh angle to the debate.

From the wintry climes of Minnesota, Lanny Schmidt, a University of Minnesota chemist, and three colleagues of his have discovered a process that could leap several of the hurdles facing the hydrogen economy: the high cost of making hydrogen, the impact on global warming of burning hydrogen, and the safe and efficient use of hydrogen in cars.

The new approach, reported in the journal Science last week, offers hope for the cheapest and most efficient method for extracting hydrogen yet.
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Overall, he says the University of Minnesota research sounds promising, even if some hurdles remain.

One such hurdle:It would require at least 40 percent of the cropland in the US to produce enough ethanol to power the nation, according to the new NRC report.
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This is an interesting thread and I wish I had some more time to read all of the links and each of the posts in depth.

A few of my quick thoughts

You'd have to be an idiot to not realize that oil is going to last forever and as this thread shows long before oil runs out the costs of pulling it out of the ground is going to be economically impractical for burning it in our cars. When we throw in all of the other environmental, political and diplomatic problems regarding being dependent on oil oil is an eventual dead end as a primary energy source.

I think that the ultimate solution to working our way out of dependency on oil has to be based on market incentives to move away. The simple logic of a long term diminishing supply of oil and short term price instability means that industries and the market should already be looking to conserve and search for alternatives to oil. The technology already exist and if sufficient investments were put into wind, solar, geothermal, renewable bio fuels and any other number of technologies we could already be free of fossil fuels.

The problem IMO is that the market is too short sighted and is too focussed on short term versus long term gains. At the same time government policies rather than supporting conservation and renewable energy has instead rewarded the most wasteful use and dependence on fossil fuels.

This is a problem of both the market and government and it will take a change in both to end our dependence on oil. All I can hope is that we can end that dependence sooner or later but simply saying that the market will fix or government will isn't going to do it .

 

OK, I didn't fell like posting this entire bizarre rant again, but it doesn't really address anything that I posted at all. All I did was point out that markets do not always function efficiently and cannot be relied on to allocate things for themselves in the most desirable fashion from the viewpoint of society as a whole ; a fairly basic and uncontroversial contention that you seem to have had a problem grasping in the past.

But instead you respond with hyperventilating tirades against generic, cartoon character 'liberals" that you conjure up and use to define your own antithetical cartoonish online persona. For example:

"So don't kill the golden goose with your beloved "taxes on the evil rich" and excessive regulation"

WTF does that have to do with anything that I posted? It's weird.