| Archive for Downsizer For an ethical approach to consumption |
| Chez |
Peak Oil - closer than people think?From today's Independent - I don't know enough about the subject to know how much is scaremongering and how much is accurate, but if true, we need to be seriously looking at alternatives:Peak Oil Article |
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| dpack |
so | ||||||||||
| Chez |
Crikey dpack, sometimes I worry that I don't understand your posts  .
So ... downsizer-people, are, generally, open to alternatives - but is society generally just going to fall apart? Is it too big an issue for people and governments to get their heads round and so no-one is going to do anything effective to put alternative sources in place, or (best) reduce consumption before the oil runs out? Are we going to sink in to a period of oil-wars and water-wars? Or will it all work out? Is it being over-emphasised by scaremongering papers? Or down-played by self-interested politicians? My favourite type of science-fiction is post-apocalyptic - I am starting to wonder if I'll find out what living in that kind of world is like in ten years time. |
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| Penny |
Reminds me,, I must get my DVD back from Lettucewoman 
It's going to happen one day - be it, 4years, 10 years, 100 years |
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| Shane |
Doesn't this story come up every year?
Yes - oil production will decline. This makes oil more expensive, which makes just about every industrial activity more expensive. This reduces industrial activity, thus reducing oil consumption. At the moment, the mechanism is a fairly gentle self-correction. We'll hit problems if there's suddenly an appreciable drop in oil reserves before we have a sufficient capacity of replacement energy-generating technologies online. I personally can't see there being a steep decline in oil production for a good while yet. In the meantime, two good things about a prolongued period of high oil prices are a) it will act as a limit on the rate of increase of world energy consumption and b) it makes research into alternative technologies economically worthwhile. I'm not going to panic...yet |
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| sean |
In your current position you should be one of the first to know... | ||||||||||
| Treacodactyl |
I don't think he meant so but rather so. 
Perhaps if oil starts to noticeably run out sooner than expected it might mean we'll do less damage to the planet in pumping out huge amounts of CO2. However, we may try and do more damage via bio-fuels for a while. |
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| Chez |
It probably *does* come up every year, but I haven't seen it framed quite like this before - the drop-before-replacement-capacity thing. I've been envisaging a gentle change - because the alternative is pretty scary, frankly, although probably good for the planet in the long term. The bio-fuels thing is a dead-end road IMHO - no good having unlimited bio-fuel if you haven't actually got enough food for people. So. .
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| AnneandMike |
The best book I've read on this is "The End of Oil" by Paul Roberts.
It is 3 years old, so this issue of 'peak oil' is hardly news. It is also widely understood that we will not experience the 'peak' as such but will only know about it after we have passed it - due to fluctuations in supply and demand (political unrest, cold/mild winters, economic cycles, etc.) It is probable that we are going through the peak at around this time. Oil interests will want to keep their knowledge of future production and reserves to themselves as much as possible. It is easy to see many reasons for this. Ultimately, and probably quite soon, demand will exceed supply. As fuel is relatively inelastic to price (if you have got to have it, you will pay just about any price) I would expect some really large increases in price (double, treble???) before that mechanism starts to reduce demand. Even then, it will take time to adjust ( not a good time to sell that £55k, 400bhp monster Range Rover  ). On top of that, the 'Hubbert curve' predicts a roughly 3% per year drop in production from then on, so the price pressure steadily intensifies.
A bit like climate change to which it is so closely linked, this problem will not go away and, however much we develop techniques to squeeze extra from the wells, there is no techno-fix. It may delay the peak by a year or two, cut the drop by 0.1% a year but the future of oil is clear. The solutions are also clear but I fear that society will only face up to that after a very hard lesson. As downsizers, I believe most of us are already making our own personal contributions to those solutions. |
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| Shane |
At the risk of sounding rude, it doesn't sound very well researched.
Nonsense. As witnessed by the massive wobble in Shell's share price, oil companies are very keen on making sure that they state their reserves correctly. What they tend to keep quiet about until they are sure one way or the other is news regarding exploration, but this is more because of the wild swings in share price that will accompany the success or failure of any explaratory drilling, not because they are worried about telling people the oil is running out.
Again, nonsense. If oil were to treble in price there would be a massive, worldwide economic crash.
This sounds more reasonable (in a politically stable world, of course ) I suspect that the price of oil will remain high, maybe creep up, over the next few years. This is a good thing, as the global economy likes stability (more than it likes cheap oil) and it makes research into the alternatives a lot more attractive.
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| AnneandMike |
Very kind of you too accept a possible drop in production after the peak - how do you think your 'price creeping up' equates with continuing rising demand? A doubling of oil price has occurred in the last few years - I cannot match your predicted worldwide crash with what has happened in recent years - the current exceptional world growth (~5% pa) which will only increase oil demand. Shell was an interesting case because they were massively inflating their oil reserves ( presumably to prop up the share price). It is easy to see all oil companies taking an 'optimistic' view on reserves - time will soon tell. Re the book, perhaps you should read it before slating it. I would imagine you get a fair amount of reading time out there. By the way, although I don't agree with you and am happy to follow up these points further, I don't denigrate your views. |
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| tahir |
I'm with Shane on this one, ultimately the green agenda will be driven by economic imperative, the likes of BP, Exxon, Toyota, Ford etc aren't just going to sit there and watch their businesses die.
Will it be too late? Maybe but I'm not of the apocalyptic persuasion. |
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| Shane |
The previous rise in the price of oil caused markets worldwide to slump, a slump from which it took a long while to recover. A further doubling would be catastrophic! Brilliant for me, of course
Yes, Shell were pulling a fast one. They were stating the optimistic end of their predicted reserves, and when they realised that they were overstated they dragged their heels in 'fessing up. When they did come clean, the share price dropped significantly. Fortunately, with the price of oil where it is, the market realised that the company was still worth a fair whack based on it's more accurate proven reserves and the share price recovered. There is now a massive drive in the industry to be whiter-than-white (sparked off by the Enron and other high-profile scandals). It's very high profile and gets drilled in to all of us on an annual basis. The majors (and minors, too, come to think of it) know full well that such a scandal results in the collapse of companies and lengthy jail sentences.
Might well do.
Unfortunately, you imagine wrong. I tend to stop work of a day because I know I have to get some sleep. There is no such thing as free time at this phase of a project 
I do allow myself a few minutes on the forum now and then, though
Apologies if I sounded denigrating, but if something is plain wrong I don't tend to skirt around the fact. Tahir's right - the sustained high price of oil is giving the majors the perfect opportunity to look at where to take their businesses next. They know full well that they have to get something lined up to replace dwindling reserves, and they also know full well that sustainable and / or green energy is a good image to be alined with at the moment. Now I'd call that a happy coincidence
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| james_so |
Don't mean to hijack the thread but there is more than just the oil to consider TBH. What are we going to do when other things start to run out? Copper, tin, lead, platinum, tantalum, uranium, etc are all being mined like crazy to keep up with demand and there is only a finite amount here on earth. If we don't find a way to expand again we are inevitably doomed as a race. How are we going to create & distribute that alternative energy with no metals? I have first hand experience of a company moving it's whole operation (not a small factory either) from UK to Brazil to keep prices of the main raw material down enough to keep up with the seemingly insatiable demand for cheap tech 'gadgets'. |
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| Shane |
I've not heard anything about the amounts of these materials left, but I think some of them are amongst the most abundant elements on earth. The emphasis is on the word "think" there, by the way!
Assuming that we're not currently in dire straits (i.e. our oil problems will hti us first) I'd hope that mankind would be significantly better at recycling by the time material constraints become an issue. We can but hope, I guess 
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| Penny |
The only thing I would say about Shell and BP and the like is the assumption that they are planning for the long term. There is such a demand for short term gains in order to please the stock market, that I often wonder if large corporations ever look beyond two or three years ahead 
Abbey National certianly did this when I worked for them. They did what was neccessary to keep the city happy, whether it was good for business or not. |
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| Shane |
The oil majors look further ahead than that. It takes a good 7 or 8 years minimum to get from interesting exploration prospect to producing oil. As the amount of proven reserves has a significant effect on share price, they will be looking for someway of maintaining share prices as the reserves start to show a consistent year-on-year decline, and the only way they will be able to do that is to show that they can replace lost reserves with alternatives, some of which will be of the green variety. | ||||||||||
| AnneandMike |
I hope you are right but, at this time, the investment is tiny compared with that spent on oil (e.g. BP's £1 bn on solar). Will the cash be there in the future to make enough investment? |
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| Shane |
The investment is small at the moment, but if you compare it year-on-year it's certainly heading in the right direction.
The way oil companies, and indeed most companies, work, is that they'll spend a fairly small amount of money in the early days researching new technology, then they'll channel more money into the most promising looking areas. I'd say we're currently somewhere between the two phases at the moment - there's still a lot of research to be done, but some areas are looking more favourable that others. |
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| James |
This may be the case for plublic companies that are traded on western stock markets. However, your argument falls down for Saudi Arabia. They produce no justification for their stated reserves. Their four big fields have now been pumping for over fifity years. Acording to George W Bush's former energy advisor, Matthew Simmons, these wells have been kept productive with the injection of water. In 2005, He suggested that "If Saudi Arabia have damaged their fields, accidentally or not, then we may have already passed peak oil". So given that Saudi Arabia doesnt produce justified reserve statements, how do we know how much there is? Since 1973, Saudi Arabia has been the worlds "swing producer"- its been able to open & close its taps to regulate the market cost of crude oil. Jeremy Legget believes that the failure of Saudi Arabia to control the rise in oil prices since about 2003 suggests that they can no longer open the taps to regulate the price per barrel. He suggests, therefore that the very old oil fields from which most of the their oil comes are drying up fast. And then there's the other big producer- Russia. Until recently, many of Russia's fields were managed by western production companies. But now they're slowly but surely being taken back into private Russian ownership. Once again, you are very unlikely to find justified figures for any exploration undertaken by private Russian oil companies. Russia and Iran hold approximately half the worlds gas supplies. My refferences are taken from Jeremy Leggets Book "Half Gone". Now here's my opinion. We'll not know until after the event just when we top 'Hubbert's Peak'. Infact, no-one can predict it acurately- a sharp winter in Europe & America next year, coupled with a reduction in diplomatic relations with Russia could bring it on by Christmas. Then again, all the hot air coming out of Saudi Arabia might have some truth in it and we may not reach peak for some years. It boils down to probability. Every day that goes by the odds that Hubberts Peak has already passed increase. At some point, the probability we have passed it out weighs the probability we havent, at which point we start living in an "Emperor's new clothes" society. Which bank will be the first to shout out? |
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| AnneandMike |
It's not just your opinion, many who have been in the business in the past share it. In the end, as you say, it is inevitable. The question is "What happens then?" I think it depends on how quickly we can adjust to a new paradigm - constantly falling supplies. There is clearly massive waste at the moment (Range Rovers?). Also systems exist to make most economic sense under current conditions, not future ones (e.g. supermarket's centralised wharehousing and distribution). If these kinds of things can be changed quickly (effectively moving to a much lower carbon economy) maybe things will be OK. If not the restructuring is going to be painful and economically damaging. We can cope with much less oil if we are in a deep recession. |
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| Shane |
Hmm - not sure I'd trust this Jeremy Leggett too much.
I've noticed that certain lobbies always mention the injection of water as if it is a last gasp attempt to get the dregs out of depleted reservoirs. Not so. Reservoir modelling has advanced enormously since the 70s, and one result is that water injection is now increasingly becoming the norm for enhancing recovery of a reservoir (we have water injection from day one out here). Even modern developments with all the latest technologies struggle to recover more than around 50% of the oil in a reservoir, and water injection is just one of a few technologies used to achieve that.
"Believes". I.e. it is his personal opinion. In the 70s, global demand was significantly lower, hence production increases necessary to dampen the price of crude were within the capacity of the Saudi infrastructure. Global demand has now increased to such an extent that even with the "taps" wide open, i.e. the facilities maxed out, they cannot always supply enough crude to satisfy that demand. There is a healthy demand for debottle necking studies and infrastructure replacement to enable Saudi (and other middle eastern-nations) to produce more oil.
Piffle. Western involvement in Russian oilfields is the recent thing, with the oil majors only feeling comfortable enough to sign up to joint agreements with Russian companies at the end of the nineties.
Or "private" in inverted commas, as is perhaps more accurate, given that most of the little companies that are being set up to take charge of assets (such as those "recovered" from Yukos, who I used to work for) have obscure connections back to the state. Interestingly, I see that BP have recently signed a memorandum of understanding to create a strategic alliance with Gazprom. A gutsy move, and certainly worth watching the outcome. However, my doubts about the integrity of Mr Leggett's data don't change the fact that at some stage, world oil demand will permanently outstrip supply. I just don't subscribe to the doomsday scenarios - although as an open-minded individual I reserve the right to alter my opinion should new data justify it
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| James |
More wells are being drilled in Saudi for water than for oil. The quantities of water required are unsustainable (based on a simple mass-balance rainfall versus abstraction calculation). The groundwater within the aquifers in the region are becoming saline – not a problem if you’re just re-injecting into oil reseviors, but a real problem if you’re a thirsty farmer irrigating fields
Yes, its his personal opinion. There are two side to this argument and Jeremy Legget clearly comes down on the early-toppers side. I agree that de-bottle necking and infrastructure replacement will allow greater productivity(…although I was under the impression that Saudi Arabia hadn’t invested in new infrastructure for quite some time…?). However, isn’t this playing around at the edges of an over-stretched system? In the bigger picture, stream-lining the system wont produce a great difference in production.
I agree that my assertion that historically western companies have controlled Russian oil was misleading. What I meant was that following the opening up of markets to international Co’s, many western company’s moved in. [quote="Shane] … most of the little companies … have obscure connections back to the state. [/quote] Yes, the state and the private assets are not easily separable. [quote="Shane] … at some stage, world oil demand will permanently outstrip supply. I just don't subscribe to the doomsday scenarios [/quote] That’s the long & short of it. Its inevitable that the oil will run out, its just when. On good days I think we can last for many years (maybe even until I’ve paid off my mortgage!) but on bad days (usually after watching the financial news on Newsnight), I worry it might be just around the corner. I still hold that we wont know until its to late. Then all hell will break loose. |
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| Shane |
And?
If it's a simple calculation, you can presumably post it? Does it account for the fact that a fair quantity of the injected water will come back up with the oil, will (usually) be recovered and reinjected?
I don't know enough about that to comment, but it surprises me. By the very nature of an oil reservoir, water injected into one stays there. If the groundwater is becoming saline, this is either completely unrelated or is due to shoddy drilling and / or well completion.
I guess I'm lucky there - the more it runs out, the easier it will become for me to pay mine!
I guess we'll find out at some stage. I still maintain that a prolongued period of high oil prices will give industry the best opportunity to research the alternatives and thus (hopefully) cushion the impact. |
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| James |
OK, I’ve done some calculations, and its not as clear cut as I first made out – I apologies for my earlier point that these wells were the cause of salination of the aquifers. It looks like they are not. Here’s my “back of a fag packet” calculation on the amount that may be abstracted by the big four well fields, relative to total rainfall. Groundwater pumped volumes: "…. The Centre for Global Energy Studies hinted at the beginning of the year that the kingdom {Saudi Arabia} appeared to be heading for difficulties. Now one of its analysts has said that having reserves does not equate to production capacity. Citing the Haradh field, he said it required 500,000 barrels per day of water injection to get out 300,000 bpd of oil. Moreover the problem is even more serious in the Khurais field." Doubts grow about Saudi As Global Swing Producer Aberdeen Press & Journal - Energy, April 5, 2004, p. 15 6.29 barrels = 1 cubic metre (http://www.og.dti.gov.uk/glossary.htm) So in the Haradh field, they are injecting (500,000 / 6.29) 79,491 cubic metres of water per day. I’ve only found the abstraction rate for this well field. To get a rough feel for how much is being injected in total, I’m going to assume that the four large well fields are roughly similar in terms of quantity of water injection. I think this will be an under esitamte because: 1) The Centre for Global Energy Studies says the problem is more serious in the Khurais field, and 2) These four fields account for 80% of the state production. (from memory- correct me if I’m wrong) So, based on these assumptions, there’s a national abstraction/ injection of 317,965 m3 per day. Rainfall “ Only in the higher areas, the mountains of Yemen and Oman, does the annual rainfall exceed 400 mm. Elsewhere it is low and unreliable; below 200 mm and often less than 100 mm “ Taken from the BBC weather summary by country for Saudi Arabia & the Arabian peninsular: (http://www.bbc.co.uk/weather/world/country_guides/results.shtml?tt=TT002770 ) Assuming and average rainfall of 150mm per year, that’s 0.410 mm per day, or 410 m3 per km2 per day 1,960,582 sq km- total land area of Saudi Arabia total rainfall over the whole country = 410 x 1,960,582= 803,838,620 m3 per day So as a percentage of total rainfall, these four well field abstractions account for 0.04% of all the rain falling on Saudi. (unit conversions via http://www.cactus2000.de/uk/unit/massrai.shtml) So this appears to prove I was incorrect in stating that they were the reason for salination of the aquifers. Now here’s the real reason why wells are pulling saline water: http://earthtrends.wri.org/pdf_library/country_profiles/wat_cou_682.pdf This document states: Annual surface water produced 2 km3 Annual groundwater recharge 2 km3 Annual groundwater abstraction 17 km3 Withdrawals as a percentage of renewable resource 955% Withdrawal by sector: Agriculture 90% Industry 1% Domestic 9% So it appears the reason the thirsty farmer cant irrigate his crops is because HE has over irrigated in the past, and there’s no water left.
Old (ancient) water is highly saline. Normally, because of the high density of this water, it site below the potable aquifers (fresh water) and isn’t drawn up. If the aquifer is stressed over long periods, the saline water is drawn upwards into the zones of the aquifer from which abstraction is made. Once its there, there’s no getting rid of it. |
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| James |
Here’s an addendum to my last post.
If industry accounts for 1% of total water abstraction, but total abstraction is 955% of renewable water resources, then industry actually accounts for 95.5% of renewable water resources. The oil industry accounts for 75% of budget revenue (https://www.cia.gov/library/publications/the-world-factbook/geos/sa.html ) So on a pro-rata basis, the oil industry may account for 72 % of the renewable water resources. |
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| wildfoodie |
Whenever it comes, the only thing we can be sure of is that the effect will hit first with the poorest people in society. call me a cynic, but I fully expect the richest people in the world to be the last to notice or suffer. any transition townies around here? actual or wannabes? | ||||||||||
| Shane |
Sorry - haven't had time to respond in ages.
Been a bit busy out here! |
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| wildfoodie |
phew.... so no need to ditch the oil fuel aga just yet??? |
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| Shane |
Supplywise, no - but it depends on how much you like paying for your fuel!
Does it run on vegetable oil?
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| wildfoodie |
oh I don't have one really, I 's just messing around... we have a gas hob with electric oven... probably just as at risk...
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| Shane |
Yeah - can't help you there. You'll have to ask Mr Putin about your gas supply, I'm afraid! |