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How long will it last? — 4 graphs

from Edward Fullbrook

If you have time, I recommend reading “The three crises: oil prices, climate change and international debt” on feasta.org.  But here are four graphs regarding oil and natural gas from the article that illustrate some  of the difficulties that we face. Read more…

Graph of the week: World’s Liquid Fuels Supply

February 19, 2011 1 comment

This alarming graph comes from a report titled:  Read more…

Oil spill numbers

from David Ruccio

The numbers just keep climbing, now making the BP oil spill in the Gulf of Mexico by far the largest in U.S. history and perhaps the largest in world history.

According to the Washington Post, the blown-out Macondo well released oil and natural gas at a rate 12 times faster than the government and BP estimated in the early weeks of the crisis and has spilled a whopping 4.9 million barrels, or 205.8 million gallons, to date.  Read more…

Peak oil — the writing is on the wall

July 28, 2010 9 comments

From  Lewis L. Smith

There is no longer any doubt that world production of crude oil [however defined] is going to peak within everybody’s planning horizons, if it hasn’t done so already. The only argument is over when.

The turning point in discussions of this subject came in 2008 when the Saudis stopped talking about producing 10 to 25 million barrels per day for the next 50 years and admitted that their production was going to peak at 12 million barrels per day within a few years and then begin to decline, until all their wells are capped.

Today the forecasts range from 2004 [Dr. Rafael Sandrea  —  conventional crude] to 2032 [Exxon/Mobil  —  all crudes] , with a preferred range of 2010  —  2015.

Needless to say, for strategic and electric-utility planners, these dates are “just around the corner”.  Read more…

Categories: energy, Uncategorized

Oil-industry statistics are full of errors, omissions and bald-faced lies

from Lewis L. Smith

BP is one of the world’s largest oil companies. It is also big on “hubris”. In fact, this hubris is undoubtedly a contributing factor to the magnum disaster which BP has just caused in the Gulf of Mexico.

["Hubris" is the ancient Greek word for "overweening pride".]

Now, as if nothing had happened to tarnish its image, BP has just presented its “Annual Statistical Review” with great self-assurance, at an invitation-only meeting in London.

To no one’s surprise, BP is one of the few remaining optimists on the question of future crude-oil supplies. In fact, its Chief Economist said at the meeting, “Oil will never peak” !  Read more…

Categories: energy

Socializing Risk: The New Energy Economics

May 27, 2010 5 comments

from Frank Ackerman

Despite talk of a moratorium, the Interior Department’s Minerals and Management Service is still granting waivers from environmental review for oil drilling in the Gulf of Mexico, including wells in very deep water. Until last month, most of us never thought about the risk that one of those huge offshore rigs would explode in flames and then sink, causing oil to gush out uncontrollably and befoul the oceans. The odds seemed low, and still do: Aren’t there lots of drilling rigs in use, year after year? Twenty years ago, your elected representatives thought that you’d be happy to have them adopt a very low cap on industry’s liability for oil spill damages.  Read more…

Fire

“Fire” by Lewis L. Smith - Analysis and photographs of the Gulf of Mexico disaster

Categories: energy

What is the social cost of carbon?

April 27, 2010 2 comments

from Frank Ackerman

The social cost of carbon may be the most important number you’ve never heard of. U.S. climate legislation is stalled in Congress, but in the meantime, the Obama administration is trying to fill the gap by considering climate impacts in the regulatory process: from the tailpipe emissions limits and gas mileage standards unveiled April 1, to energy-efficiency standards for many types of residential appliances and commercial equipment.

This is important work; U.S. action to reduce greenhouse-gas emissions is long overdue, and it’s crucial in the global picture, both because of our large share of total emissions, and because of our ability to influence other nations. But it’s also important to do this right, and a look at how the administration has handled the social cost of carbon (SCC) raises some serious concerns.  Read more…

Why Is Obama Drilling?

April 14, 2010 2 comments

from Frank Ackerman

Once upon a time, “There’s Only So Much Oil in the Ground” was a popular song that could be heard on the radio. The year was 1974, and Tower of Power, an Oakland-based soul and funk band, was enjoying some commercial success. They made the year’s top 100 with “What is Hip?” In addition to the important topics of being young, hip, and falling in and out of love, they sang about the energy crisis. Following a brief OPEC oil embargo, the price of crude oil (in today’s dollars) jumped from $23 per barrel in 1973 to $41 in 1974. Everyone was thinking about the world’s finite and diminishing supplies of oil. As the song continued, “Sooner or later there won’t be much around.”  Read more…

DOE sidles up to peak oil

April 2, 2010 2 comments

from Lewis L. Smith

Traditionally, the US Department of Energy has denied the existence [or at least the imminence] of a peak in world production of crude oil. In this regard, it has faithfully followed the traditional oil-industry line, frequently referring to such an event by the pejorative phrase, “the theory of peak oil”.

Suddenly, however, DOE seems to be sidling up to the possibility that this alleged “theory” might actually become a reality. In a recent, largely ignored, semipublic meeting, the US Department of Energy presented, as one of its scenarios of the future, the most pessimistic scenario in the agency’s history,  apparently without assigning it any probability .  Read more…

Two peaks for the price of one

March 12, 2010 4 comments

from Lewis L. Smith

Unlike some of the debates in the 20th Century, the debate over peak oil in the 21st  [2004-2008] was not at all theoretical. It was very practical. It turned on two questions  —  What is the condition and actual production of Saudi Arabia’s active oil reservoirs ?  How accurate are the projections of future production?

Despite recent op-ed articles in some of the principle media, the debate is over, and the pessimists won. In 2008, the King said that future confirmations and discoveries would be reserved “for our children” [not your SUV]. Subsequently managers at Saudi Aramco, the country’s oil company, stated  —  for the first time in history  —  that oil production would peak in a few years, plateau for a decade and then decline, until the wells were capped.  Read more…

Categories: energy

The Bakken Formation — hype or a new Saudi Arabia

January 10, 2010 3 comments

from Lewis L. Smith

A friend asked me to comment on some material which he had received, extolling the virtues of the Bakken Formation, which appears to have received considerable publicity among investors in the USA.

This is a large mass  of underground rock located mostly in Montana and Wyoming, running up to the Canadian border at least. According to a recent study by the US Geological Survey, this formation may contain large amounts of oil and gas which could be extracted using current technology. In fact, it is already being exploited successfully, and some people believe that it might even be another Saudi Arabia !

The Bakken Formation should not be confused with the  now famous, gas-bearing Barnett Formation. Their only similarities are that both both names begion with the letter “B”, both contain lots of shale rock and both have been subject to broker-inspired hype.

Since this  “good news” has coincided in  with the promotion of stock in oil or gas companies,  I though that I would try to inject a word of caution into the discussion of this geological phenomenon with  possibly large economic, environmental and political significance. Read more…

One act of censorship overcome

December 15, 2009 Leave a comment

Clive Spash’s paper “The Brave New World of Carbon Trading”, which the Australian authorities suppressed, is now available at:
http://mpra.ub.uni-muenchen.de/19114/1/MPRA_paper_19114.pdf 
For background see:
Censorship of Critique of Emissions Trading and Carbon-Offsets Schemes
Update on Censorship of Critique of Emssions Trading Schemes

Carbon credits: Britain’s richest man cleans up

December 7, 2009 2 comments

The climatologist James Hansen opposes the cap and trade scenario being considered at Copenhagen on two grounds: one, at the real-world level it is essentially a programme for fraud and corruption, and two, it is essentially greenwash and thus serves to postpone, yet again, serious attempts at carbon reduction. Yesterday’s Sunday Times provides supporting evidence for Hansen assertion that cap and trade is a system for “paying off numerous special interests”.  Read more…

Shale gas – article yanked and editor fired

November 30, 2009 1 comment

from          Lewis L. Smith

Natural gas can be extracted from a kind of low-porosity rock known as shale. Indeed shale gas is already making a substantial contribution to the US gas supply. Moreover, some very optimistic estimates have been made about the quantity which could be produced in the future, without giving any thought to the  availability of the water required to fracture this rock and release commercial quantities of gas from newly discovered reservoirs.

Indeed some people are even looking to shale gas to “save” the USA from the impact of the coming peak in world crude-oil production. In the meantime, stock in shale-gas producers is being touted to investors as “the greatest thing since sliced bread”.

However, Read more…

Categories: energy

Oil prices

November 28, 2009 Leave a comment

In the markets for physical petroleum liquids, there is unprecedented speculation in favor of an oil-price increase. The speculative volume is the highest in ten years and the dollar amount involved is the highest ever. Moreover, the speculation involves both crude oil and products, especially  “middle distillates” such as diesel, an important fuel for construction, manufacturing and land transportation.  Read more…

Categories: energy

Political documents vs. scientific ones – #2

November 26, 2009 Leave a comment

Comparing the graphs tells the whole story (See Political documents vs. scientific ones). A essential point not made is that the finding, proving, delineating and bringing on line of an oil reservoir takes time, typically three to ten years. So the early stages of the search for much of the production “to be found” should be visible “in the pipeline” already. Only it isn’t, at least not for Dr. al Husseini, former head of exploration and production for Saudi Aramco. As he says, “there aren’t enough projects”, and a lot of us agree with him. Read more…

Categories: energy

Political documents vs. scientific ones

November 13, 2009 5 comments

Tuesday the International Energy Agency released its annual “World Energy Outlook” report http://www.iea.org/speech/2009/Tanaka/WEO2009_Press_Conference.pdf, in which it forecast that by 2030 world oil production would increase from the current 85 million barrels per day to 105.  But yesterday the Global Energy unit at Uppsala University in Sweden issued a report “The Peak of the Oil Age” which claims oil production is more likely to be 75 million barrels a day by 2030.  The diagrams below, from the Guardian, illustrate the radical difference between these two views of our next twenty years.   Read more…

The Job Loss from Reducing Greenhouse Gas Emissions and the Job Loss from Defense Spending

November 10, 2009 2 comments

There is a major national ad campaign, funded by the oil industry and other usual suspects, to convince the public that measures to reduce greenhouse gas emissions (GHG) and slow global warming will result in massive job loss. This ad campaign warns of slower growth and the loss of hundreds of thousands of jobs, possibly even millions of jobs, if some variation of the current proposals being debated by Congress get passed into law.   Read more…

Censorship of Critique of Emissions Trading and Carbon-Offsets Schemes

November 7, 2009 6 comments

As the Copenhagen Climate Summit Approaches, heterodox economic analysis of climate change policies needs a bigger profile. The good news is that Edward Elgar Publishing is shortly to release Keynesian and Ecological Economics: Confronting Environmental Issues edited by Ric Holt, Steve Pressman and Clive Spash. The bad news, however, is that, as things currently stand, New Political Economy won’t be publishing an important paper in this area by Clive Spash, that the journal had accepted following normal refereeing processes. The paper is entitled ‘The Brave New World of Carbon Trading’, but Clive’s employer, Australia’s Commonwealth Scientific Industrial Research Organisation (CSIRO) wrote to New Political Economy demanding that it not be published.   Read more…

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