Peak Oil (was "petroleum geologist explains US war policy")

[Backatcha Bandit]

Excuse me, I'm having a 'Johnny Canuck' moment...

Someday I'll wish upon a star
And wake up where the clouds are far
Behind me.
Where troubles melt like lemon drops
Away above the chimney tops
That's where you'll find me.

Well, Dorothy... we ain't in Kansas anymore.

Oil prices hit all-time high
Traders focus on tight inventories, ignore OPEC decision to raise production, sending crude to highest settle ever.
September 11 2007: 3:52 PM EDT

NEW YORK (AP) -- Oil prices rose to a new record settlement price Tuesday as traders turned their attention to Wednesday's government inventory report expected to show tight supplies and shrugged off OPEC's decision to boost output.

Light, sweet crude for October delivery rose 74 cents to settle at $78.23 a barrel on the New York Mercantile Exchange after alternating between gains and losses. The settlement price beat the previous record, set July 31, by 2 cents.

Even factoring in OPEC's decision to increase oil production by 500,000 barrels per day starting Nov. 1, "supplies are tight," said Addison Armstrong, an analyst at TFS Energy Futures LLC.

http://money.cnn.com/2007/09/11/markets/bc.apfn.eu.fin.mkt.oilp.ap/index.htm?cnn=yes

Now, why would 'the markets' ignore 'OPEC's decision to increase oil production by 500,000 barrels per day'?

Probably because the latest 'official' OPEC production figures show that they're already 'overproducing' (above the quota) to the tune of 900,000 bpd.

Another factor might be the exploding pipelines in Mexico, which apparently killed around 30 people and injured 150, leaving a 100ft wide crater.

The BBC assure us that the one on Sunday was an 'accident' - but not so the six other explosions on Monday, regarding which Reuters appear keen to assure us that the 'Mexico pipeline bombers threaten new attacks'.

Didn't hear much about that, couldn't see any threads on it here. Pesky 'Leftist Rebels' - they don't fit into the 'Freedom hating Jihadist' narrative... the 'wrong' sort of 'terrorists'.

 

[Backatcha Bandit]

Couple of interesting stories yesterday...

Oil industry 'sleepwalking into crisis'

Former Shell chairman says that diminishing resources could push price of crude to $150 a barrel
By David Strahan and Andrew Murray-Watson
Published: 16 September 2007

Lord Oxburgh, the former chairman of Shell, has issued a stark warning that the price of oil could hit $150 per barrel, with oil production peaking within the next 20 years.

He accused the industry of having its head "in the sand" about the depletion of supplies, and warned: "We may be sleepwalking into a problem which is actually going to be very serious and it may be too late to do anything about it by the time we are fully aware."

In an interview with The Independent on Sunday ahead of his address to the Association for the Study of Peak Oil in Ireland this week, Lord Oxburgh, one of the most respected names in the energy industry, said a rapid increase in the price of oil was inevitable as demand continued to outstrip supply. He said: "We can probably go on extracting oil from the ground for a very long time, but it is going to get very expensive indeed.

http://news.independent.co.uk/business/news/article2966842.ece

Also this:

Rig owners leave gulf for longer-term deals

Other economic environs are better for them

07:45 PM CDT on Sunday, September 16, 2007

By VASANTH SRIDHARAN / The Dallas Morning News
vsridharan@dallasnews.com

Oil and natural gas drilling in the Gulf of Mexico is falling off because rig owners say that they can get much longer contracts in places where the reserves are larger.

While rigs move to places such as the west coast of Africa, Brazil and the Middle East, the number of rigs in the Gulf of Mexico has fallen by 19 from this time last year, to 72. At this time in 1997, the count was 122, according to the Baker Hughes rig count.

Locally, the Texas Railroad Commission, which oversees permits for oil and natural gas drillers both onshore and in Texas waters, has received 27 applications for permits for shallow-water drilling this year. The total number from last year was 76. Deep-water applications are also slightly below last year's level.

http://www.dallasnews.com/sharedcontent/dws/bus/stories/091707dnbusgulfdrilling.2a5a40d.html

 

[david dissadent]

Oil is only half of the problem. Deplition of gas supplies in the US and Canada in the next 10 years are likely to be very significant.

And the Russians may not be able to get new fields online in time to replace depleting fields to supply much of europe, just as Britain starts to really rely on foriegn gas.

 

[clv101]

Oil is only half of the problem. Deplition of gas supplies in the US and Canada in the next 10 years are likely to be very significant.

Indeed, in North America and Europe I think gas will be more of a problem than oil over the next decade.

 

[laptop]

And the Russians may not be able to get new fields online in time to replace depleting fields to supply much of europe, just as Britain starts to really rely on foriegn gas.

This morning's New Europe - a really rather dreadful Brussels freesheet - quotes an Estonian minister as saying that Russia only has 4-5 years of gas left.

This in the context of Estonia refusing permission for the Baltic pipeline to go through its territorial waters and of, er, a perhaps slightly different attitude to exaggeration by officialdom and media in the ex-Soviet countries.

But wtf

 

[bigfish]

in this article, Russia is far from oil's peak, F William Engdahl expands on the real abiotic nature of petroleum, and explains in turn how this augments US militarism. Well worth the read as an antidote for anyone fed up to the eyeballs with the endless pseudoscientific drivel peddled by "peak oil" PR alarmists painted green.

The good news is that panic scenarios about the world running out of oil any time soon are wrong. The bad news is that the price of oil is going to continue to rise. "Peak Oil" is not our problem. Politics is. Big Oil wants to sustain high oil prices. US Vice President Dick Cheney and friends are all too willing to assist.

More: http://www.atimes.com/atimes/Central_Asia/II27Ag01.html

 

[Fruitloop]

That would mean that dinosaur remains became compressed and over tens of millions of years fossilized and were trapped in underground reservoirs perhaps 1,200-2,000 meters below the surface of the Earth.

Dinosaur remains?

F. William Engdahl, an economist and writer, is author of the best-selling book on oil and geopolitics, "A Century of War: Anglo-American Oil Politics and the New World Order", which has been translated into Arabic, Korean, German, Croatian and Turkish. He has just completed the soon-to-be released "Seeds of Destruction: The Hidden Agenda of GMO".

Another fucking loony with some turdy books to peddle then.

 

[Crispy]

So a 30km cube of dead animals is inconceivable? This is a case of 'no wai!' reasoning. Next time you see some limestone cliffs, realise that all of that used to be animals too. And also remember that oil 'flows' uphill until it meets an impervious layer, so that 'cube' could have started as, say a lake/ocean bed many 1000's of sq.km.

 

[Fruitloop]

I mean any organic material will do - why concentrate on dinosaurs other than to make the theory look sillier than it actually is? Personally I can imagine a huge deposit of zooplankton or algae a fuck of a lot easier than I can imagine a 30km cube of dead pterodactyls.

 

[david dissadent]

Its not dead pterodactyls that are the issue. The current theory is that oceans stopped circulating between the top and bottom layers turning the deep oceans anoxic. Biotic material that died fell to the sea floor without decomposing. It built up and became trapped under the sedament. As it reached a deep enough depth it was cooked into oil and if deeper still gas. Where this happened than there was an impervious layer of sedament above it this meant it settled and stayed under the rocks.

These periods of anoxic oceans are assosiated with very high CO2 levels believed due to hyper vulcanicity such as the creation of the Siberian Traps.

 

[Fruitloop]

Well yeah, exactly.

 

[Fruitloop]

Dp

 

[Barking_Mad]

Apologies if this has been published already - interesting read......

The Peak Oil school rests its theory on conventional Western geology textbooks, most by American or British geologists, which claim oil is a ‘fossil fuel,’ a biological residue or detritus of either fossilized dinosaur remains or perhaps algae, hence a product in finite supply. Biological origin is central to Peak Oil theory, used to explain why oil is only found in certain parts of the world where it was geologically trapped millions of years ago. That would mean that, say, dead dinosaur remains became compressed and over tens of millions of years fossilized and trapped in underground reservoirs perhaps 4-6,000 feet below the surface of the earth. In rare cases, so goes the theory, huge amounts of biological matter should have been trapped in rock formations in the shallower ocean offshore as in the Gulf of Mexico or North Sea or Gulf of Guinea. Geology should be only about figuring out where these pockets in the layers of the earth , called reservoirs, lie within certain sedimentary basins.

An entirely alternative theory of oil formation has existed since the early 1950’s in Russia, almost unknown to the West. It claims conventional American biological origins theory is an unscientific absurdity that is un-provable. They point to the fact that western geologists have repeatedly predicted finite oil over the past century, only to then find more, lots more.

Not only has this alternative explanation of the origins of oil and gas existed in theory. The emergence of Russia and prior of the USSR as the world’s largest oil producer and natural gas producer has been based on the application of the theory in practice. This has geopolitical consequences of staggering magnitude.

http://www.engdahl.oilgeopolitics.net/Geopolitics___Eurasia/Peak_Oil___Russia/peak_oil___russia.html

 

[Crispy]

Yes, bigfish linked it 7 posts ago.

 

[david dissadent]

in this article, Russia is far from oil's peak, F William Engdahl expands on the real abiotic nature of petroleum, and explains in turn how this augments US militarism. Well worth the read as an antidote for anyone fed up to the eyeballs with the endless pseudoscientific drivel peddled by "peak oil" PR alarmists painted green.



More: http://www.atimes.com/atimes/Central_Asia/II27Ag01.html

The arguments he uses are a crock of shit. Notice he claims that the lower 48 states in the US peaked because of underinvestment due to cheap arabian oil. Oil peaked in the lower 48 in 1971, oil prices sky rocketed in 1973 then during the late 70s vastly more expensive offshore drilling took place. Its increadible that the argument used there is accepted by anyone.

Most of the rest of the article is also pretty bloody awfully short on facts as well.

Here is what the Russians themselves say about the Dnieper-Donets basin.
http://aapg.confex.com/aapg/2006int/techprogram/A106645.htm

 

[paimei01]

http://articles.moneycentral.msn.co...s/ShuckTheEthanolAndLetSolarShine.aspx?page=1

New research by a University of California petroleum engineering professor suggests that worldwide crude oil supplies will start to run so low over the next nine years that resource-blessed countries like Saudi Arabia will begin to hoard them for domestic use instead of exporting -- and states with large reservoirs of natural gas, like Montana, will seek ways to avoid sharing with less-advantaged neighbors like Oregon.

Attempts to forestall the political and economic damage by turning aggressively to agriculture for "renewable" transportation fuel in the form of ethanol will prove futile, according to professor Tad W. Patzek, as new calculations show that the entire surface of the Earth cannot create enough additional biomass to replace more than 10% of current fossil fuel use.

The process of sowing, fertilizing, reaping, distributing and refining corn and grasses for ethanol feedstock uses up nearly as much carbon energy as fuel farmers claim to save, and it generates so much soil degradation and toxic byproducts that widespread use will leave the Earth denuded and hostile to human life within decades, according to the professor's data.

 

[david dissadent]

Export land

 

[david dissadent]

Oil hits $84 a barrel.

US inventories are currently falling. I am hunting for a more detailed analysis.

 

[Backatcha Bandit]

$89

 

[bigfish]

Oil hits $84 a barrel

$89

That's the plan - to drive up the price and thus the profits from an otherwise abundant and overpriced resource behind a cacophony of alarm from fake left accomplices in the environmental movement about imaginary scarcity.

 

[Crispy]

What a fiendish plan! So devilishly intricate and cunning!

 

[bigfish]

Mankind will never run out of oil

The scientific community could no longer disregard the abiogenic hypothesis as more facts have come to light over the last several years. The theory has been gaining ground following recent sensational reports. As it turned out, some of the old oil fields have reportedly yielded 150 percent of the previously estimated volumes of recoverable reserves, and they keep producing contrary to forecasts.

“All the petroleum fields presently producing are drawing hydrocarbons from an open and active fault from the mantle. We should bear in mind that there is no such thing as an impermeable rock,” Dr. Skaryatin said. “There are two small-sized oil fields located on the border between Georgia and Azerbaijan. They have been producing for more than 100 years. We are aware of similar oil fields in the Carpathians, South America and other regions,” added he.

Renat Muslimov, an adviser to the president of Tatarstan, claims that the 60-year-old Romashkin oil field has been constantly drawing petroleum via the faults in the basement. “We have previously considered the field as depleted by 80 percent. However, the reserves show an increase of 1.5 - 2 million tons each year. According to our new estimates, the field will be producing up to the year 2200,” Muslimov said.

The first well in the Old Oil Field, located in Grozny, the capital of Chechnya, was drilled in the late 1890s. About 100 million tons of crude had been extracted from the field by the mid-twentieth century. Then the field was deemed depleted. However, the field “came to life” fifty years later. The wells are filling up with oil again, and the replenishment rate is extremely high. Locals are reported to use buckets for drawing oil.

http://english.pravda.ru/science/earth/98622-2/

 

[Crispy]

Interesting.
Why doesn't it happen everywhere?

 

[bigfish]

Interesting.
Why doesn't it happen everywhere?

I'm sure it does most of the time. But don't forget it serves the interests of oil cartels to perpetuate the myth of scarcity in order to keep prices high. That's where the hairshirt brigade come in.

 

[Crispy]

So all declining production the world over is in fact a conspiracy to keep prices high? If they turned the pumps back on, the mainland US and North sea rigs could be back to full production?

 

[bigfish]

So all declining production the world over is in fact a conspiracy to keep prices high? If they turned the pumps back on, the mainland US and North sea rigs could be back to full production?

Production isn't in decline "the world over", only the hold on world oil supplies by Western oil cartels.

 

[Crispy]

Not everywhere, no. But the US mainland oil fields declined smoothly in production from the 70s. They've been pretty comprehensively drilled. Are you saying that his decline - ongoing for decades - has been the result of deliberate interference with production rates? If the conspiracy was removed and all the old wells were started up again, the oil would flow like it used to? Because the oild has been regenerating all this time? Or is the US mainland an area where the oild supply is not from abiogenic origin? Or is it an area where the abiogenic process has shut down?

 

[bigfish]

Not everywhere, no. But the US mainland oil fields declined smoothly in production from the 70s. They've been pretty comprehensively drilled. Are you saying that his decline - ongoing for decades - has been the result of deliberate interference with production rates? If the conspiracy was removed and all the old wells were started up again, the oil would flow like it used to? Because the oild has been regenerating all this time? Or is the US mainland an area where the oild supply is not from abiogenic origin? Or is it an area where the abiogenic process has shut down?

I'll tell you what, if you raise the necessary financing and get permission from the various US oil giants, I'll organize a detailed survey of old American wells for you. In the meantime, you might try reading the article by William Engdahl on oil geopolitics that is posted above.

From the article:

Peak Oil theory is based on a 1956 paper done by the late Marion King Hubbert, a Texas geologist working for Shell Oil. He argued that oil wells produced in a bell curve manner, and once their “peak” was hit, inevitable decline followed. He predicted the United States oil production would peak in 1970. A modest man, he named the production curve he invented, Hubbert’s Curve, and the peak as Hubbert’s Peak. When US oil output began to decline in around 1970 Hubbert gained a certain fame.

The only problem was, it peaked not because of resource depletion in the US fields. It “peaked” because Shell, Mobil, Texaco and the other partners of Saudi Aramco were flooding the US market with dirt cheap Middle East imports, tariff free, at prices so low California and many Texas domestic producers could not compete and were forced to shut their wells in.

 

[Crispy]

But the price is high now - they should get pumping. Any way to bring the price of oil down would be an election winner right now.

 

[david dissadent]

Its crap economics of the first degree. Last time there was a major spike in oil prices was the 1970s energy crisis. Oil got up to the equivelent of $90 a barrel in 2007 money adjusted for inflation, the result an enormous recession and a major program of international energy efficiency savings. It is called demand destruction, where the price of a product drives consumption down.

This graph shows rather well the collapse in demand in 1980, it took ten years to recover and the price is worse....

Collapsing to only $15 per barell in the mid 80s. It was not until 1999 that it finaly stabalised above $20 per barrell.

If the oil majors and OPEC are indeed manipulating the price of oil then they risk losing everything quickly as demand destruction and recession follow.

It also begs the question why with oil at $86 a barrell desperate governments with long depleted wells dont sink one expolartory well just to check....or why depleted wells run by small oil firms do not report refilling, or why there is not widespread leaking from long depleted and abandoned wells.

Oh one more point at the price of oil being above $40 a barrell LNG, oil from coal, biofuels, Canadian tar sands and other technologies become feasible, as the capital becomes available to fund these projects the "monopoly" of light sweet oil evaportates.