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

Shell sets new UK profits record BBC 31 January 2008.

"The Anglo-Dutch oil firm Royal Dutch Shell has reported annual profits of $27.56bn (£13.9bn), a record for a UK-listed company.

Much of the rise in profits has been attributed to rising oil prices, which currently stand at about $91 a barrel compared with $57 this time last year.

But there is concern among analysts that Shell has delayed publishing figures showing its oil reserves."

Shell's slippery slope BBC 18 March, 2004.

"The company has delayed its annual report, due on Friday, until later in the year.

And for the second time in less than four months, it has had to admit to getting its estimated oil reserves wrong."

I wonder what will happen this time around?
 
CERA called out by Aramco

Quote:
The January 17 press release by Cambridge Energy Research Associates (Cera, see www.cera.com), which was carried by Reuters, reported the world's oil supplies were to rise to 112 million barrels per day (Mb/d) by 2017. This rise is in spite of their other conclusion that the world's oilfields are declining in capacity at the average rate of 4.5% per year. These conclusions are clearly suspect.

Given the current global production of 86 Mb/d and Cera's 4.5% decline rate, global capacity would have to increase by 7.5 M b/d each year for the next ten years to reach 112 M b/d. This is a total of 75 M b/d of new capacity in 10 years. Even excluding the effect of declining rates, achieving 112 M b/d within a decade represents a massive leap of 26 M b/d in global capacity.

To put this in perspective, 75 M b/d of new capacity is the equivalent of eight new Saudi Arabias or 14 new Irans in just 10 years. Considering the reality that Saudi Arabia, with 25% of the world's best proven reserves, is already investing $50 billion to increase its production capacity by 2 M b/d, where does Cera expect the additional 24 M b/d of production capacity to come from, let alone the replacement for the 51 M b/d of declines?
Dr. Moujahed Al-Husseini, Editor-in-Chief, GeoArabia
Dr. Sadad Al-Husseini, Former Saudi Aramco Vice-President, Exploration and Producing
 
Dont worry, everything will be fine. The availability of oil is dependent on the price. As prices rise, so does the commercial viability of new fields. There is plenty of oil.
 
rover07 said:
Dont worry, everything will be fine. The availability of oil is dependent on the price. As prices rise, so does the commercial viability of new fields. There is plenty of oil.
Click to expand...
Lol. No. It is dependent on the amount of energy to get it out of the ground not the cost. When it takes more energy to remove it and process it than you get from burning it, no cost is going to make that worthwhile. The flowrate of the wet rock and the pressure of the oil in the ground together with its depth are major factors in the amount of energy required to get it out.

This is the problem with many of the new ultra deep fields being discovered and booked is that without test wells to gauge the flowrate there is no realistic way of knowing whether the recoverable amounts of oil will be worth the investment in energy to build extreamly expensive deep sea platforms.

It is true that a number of fields will become economical or return to being economical as the cost increases, but this is not or I have never seen this number presented as a linear increase. These tend to be smaller marginal fields were the net energy recovered will be low and the flow rate stodgy, but with a 10 fold increase in price this marginal oil will become economical. But we are talking about a small number of low producing fields.

The other major factor is the sheer raw physics of well numbers. It takes quite some time to build an drilling rig and there are only so many in the world, all of these are currently engaged in drilling, mostly in long producing areas to keep up flow rates. They are not yet available to work on new fields, and likely will not for some time as the exploration and development costs of the older fields have been amortized so the oil is relative profitable even if it is just squeeking out low flow rate heavy crude.

If someone could give the numbers of these fields that will replace Gwahar, Canterall and Burgan when the price increases, please feel free to post them.
 
Dont worry, everything will be fine. The availability of oil is dependent on the price. As prices rise, so does the commercial viability of new fields. There is plenty of oil.
Click to expand...

Whew. That's a relief. Some idiot told me that the amount of available oil was finite, and that its price depended on its availability. So you mean it's priced like software? All I have to do is demand more, and more will appear? Well then, everything's OK. Lets shop.
 
A new method of extracting heavy oil is showing alot of promise. Especialy tar sands.

http://canada.theoildrum.com/node/2907#more
It wont work on shale and can probibly only raise the recoverable amount from 5-10% in place. It also has alot of technical questions and is probibly about 10 years from taking off comercialy. Something to help mitigate the downside of the slope.
 
http://news.bbc.co.uk/1/hi/business/7266223.stm

$102 dollar oil. Now in the US they are talking about $4 a gallon of petrol. Rising food and gas prices are one of the reasons other than crashing home values and no credit available that ordinary americans now believe they are in a recession. The euqity markets have been booming over the past couple of days as the Bulls are on Parade again.

The 'gas' price at the pump did not really hit its full height during the last $100 run as refinary margins were run to as near minimum operating level as possible so as to cusion consumers from what was considered a spike not a trend and refinaries were allegedly taking a bit of a hit in terms of profit. This time they wont. US citizens living in the exburbs
http://www.urbandictionary.com/define.php?term=xburb
will feel the pain as they have to fill there giant tanks with petrol that costs nearly twice as much as a couple of years ago.

The whole exburb phenominon is a low oil cost one. It was the movement of middle class people to McMansions in new towns often 60 miles from the city they worked in. The McMansions, very large houses built on the cheap inthe exburbs, were affordable due to rediculously low interest rates provided without sufficient collateral (125% financing on $400 000 house) without sufficient income to cover a spike in rates and often with dodgy loans such as Option ARMs or ARMS ( http://en.wikipedia.org/wiki/Adjustable_rate_mortgage ) ( http://www.mtgprofessor.com/Tutorials2/option_arm_tutorial.htm ) and other funky credit types. They could afford to live so far from the city because oil was selling for $20-$30. Now that interst rates are going up, oil has trebled in more than trebled in price and home prices are falling, the middle classes are feeling squeezed from ever direction.

How has oil affected interest rates? Well the US buys its oil from foreign countries. This means dollars go out of the US to the tune of about $400 billion a year for oil. This $400 billion is depressing the price of the dollar which means that interest rates have had to go up to attract foreign investment. This increasing interest rates has forced up fixed rate mortguages (not too mentios the arms and option arms).

Higher oil prices feed into all of this reinforcing it all.
 
david dissadent said:
A new method of extracting heavy oil is showing alot of promise. Especialy tar sands. http://canada.theoildrum.com/node/2907#more
It wont work on shale
Click to expand...

The recipe goes as follows: take one tonne of sand, 8 tonnes of water and 1000 standard cubic feet of gas. Boil the water with the gas and heat the sand. You produce 1 barrel of oil and 9 tonnes of sludge.

Transport the barrel of oil to market somewhere, noting that the barrel contains slightly less energy than was required to manufacture it. Dispose of the sludge somewhere, noting that replacing 5% of U.S. annual gasoline consumption with tar sand oil generates the equivalent sludge volume of one small Canadian lake annually.

Not only does it not work on shale, it doesn´t work on tar sand. It certainly won´t work on anything without water. Or without gas. Shame the Canadian government is withdrawing all the water licenses because of the collapsing aquifer levels, and will not have enough gas to meet domestic consumption in 10 years.

Tar sand is an energy sinking tax boondoggle designed to convert Canadian gas into U.S. motor spirit. As a tax boondoggle we can agree that it is showing a lot of promise.
 
$108

http://www.bloomberg.com/apps/news?pid=20601087&sid=astD3YDL_ma4&refer=home

March 10 (Bloomberg) -- Crude oil rose above $108 a barrel in New York to a record as investors purchased futures because the returns have outpaced those of financial markets.

Oil in New York surged 80 percent over the past year as the S&P 500 and Dow averages dropped. China, the second-biggest oil- consuming country, increased crude-oil imports by 18 percent last month and halted overseas shipments to meet rising demand.

``Momentum coupled with sufficient fundamental underpinnings, such as the Chinese oil-import data for February, keeps propelling us,'' said John Kilduff, senior vice president of energy at MF Global Ltd. in New York. ``The grab for hard assets is on due to the lack of confidence in the rest of the markets at the moment.''

Crude oil for April delivery rose $2.77, or 2.6 percent, to $107.92 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures surged to $108.21 a barrel today, the highest since trading began in 1983.
Click to expand...
 
Falcon said:
The recipe goes as follows: take one tonne of sand, 8 tonnes of water and 1000 standard cubic feet of gas. Boil the water with the gas and heat the sand. You produce 1 barrel of oil and 9 tonnes of sludge.

Transport the barrel of oil to market somewhere, noting that the barrel contains slightly less energy than was required to manufacture it. Dispose of the sludge somewhere, noting that replacing 5% of U.S. annual gasoline consumption with tar sand oil generates the equivalent sludge volume of one small Canadian lake annually.

Not only does it not work on shale, it doesn´t work on tar sand. It certainly won´t work on anything without water. Or without gas. Shame the Canadian government is withdrawing all the water licenses because of the collapsing aquifer levels, and will not have enough gas to meet domestic consumption in 10 years.

Tar sand is an energy sinking tax boondoggle designed to convert Canadian gas into U.S. motor spirit. As a tax boondoggle we can agree that it is showing a lot of promise.
Click to expand...


http://www.ft.com/cms/s/0/3310a3d0-ee0d-11dc-a5c1-0000779fd2ac.html

Hmmm seems tar sands are under threat by (wait for it)


US laws......... on enviromental grounds ffs.

Somedays the world is so crazy even I crack a smile.
 
What exactly would you say was the relationship between your post and mine? Is your argument that, because there are some poor arguments against tar sand, all arguments against tar sand are poor? Is that your argument?
 
Falcon said:
What exactly would you say was the relationship between your post and mine? Is your argument that, because there are some poor arguments against tar sand, all arguments against tar sand are poor? Is that your argument?
Click to expand...
Errr no. Id say that your post was critical of tar sand's EROI (energy return on investment) and enviromental considerations and mine pointed out that the US may even ban tar sands on enviromental grounds, I thought the irony was quite funny given the US's backward approach to global warming.
 
Why is the price of oil so high?

NA-AP711A_Diese_20080311203634.gif


http://online.wsj.com/article/SB120527903284528663.html?mod=moj_industries

Oil is on a record breaking bull run of economy breaking potential. $100 oil is now old news, $103, $104, $107 and even $110 have all been broken on this price surge. Most are dismissive of this stating it is all speculation. This however has not washed with several market watchers I know, they have been saying that the big hedge and investment funds have been shorting there oil positions expecting it to go down. Most of the popular pundits have been predicting a drop in price since it hit $100. They say the underlying fundamentals dont support it.

To prove this they show petrol and distillate stocks rising. But there is a wee glitch in this. Petrol and distillites are not the only oil product. Diesel is also manufactered from oil. Traditionaly Europe refines far more diesel than the US as its people are happier with the lower performance higher economy of diesels. You get diesel models of just about all luxuary European sedans. As the cost of oil increases Europeans are turning even more to diesel, and as Asia economicaly expands the advatage of a fuel that can be used for generators and trucks is very apealing, so they are also demanding more diesel. The US has surplus petrol stock rising in the refinaries but the world is demanding more oil to refine into diesel.

Exactly what the corect price of oil is will be difficult to guess as the higher it gets the more users will be forced out of the market, but the very high prices above $90 seem to be here to stay for a while. Well until the US economy tanks on a monumental scale.
 
I see that the IEA has called for an emergency meeting about record oil prices. I wonder if we'll get to hear what is discussed there?

Also:
George Bush on his recent trip to Saudi said:
1) “If they don't have a lot of additional oil to put on the market, it is hard to ask somebody to do something they may not be able to do.”
2) “I hope that OPEC, if possible, understands that if they could put more supply on the market it would be helpful. But a lot of these economies are going -- a lot of these oil-producing countries are full out.”
3) there is not a lot of excess capacity in the marketplace. What's happened is, is that demand for energy has outstripped new supply. And that's why there's high price.”
Click to expand...
source
 
Challenge Our Myths

CHALLENGE OUR MYTHS
AAPG & AAPG EUROPEAN REGION ENERGY CONFERENCE AND EXHIBITION

18-21 November, 2007 Megaron, Athens International Conference Centre, Greece. General Chairman: Geir Lunde Un-Traditional Theories and Ideas in Global and Large Scale Geology Co-Conveners: Stavros. T. Tassos and Karsten M. Storetvedt

The “Challenge Our Myths” AAPG Athens conference, under the inspired general chairmanship of Geir Lunde, was attended by more than 1200 international participants. During the three days, and in 25 parallel sessions, more than 300 oral and poster presentations were delivered. The whole conference, including sessions like Un-Traditional Theories and Ideas in Global and Large Scale Geology, Unconventional Resources – The Modern Theory of Abiotic Genesis of Hydrocarbons and Unconventional Heavy Oil Resources – Advances, Challenges and Case Studies, mark a turning point for the Geosciences.

It is the first time such themes have been raised at a larger Western geological conference. The general slogan - Challenge Our Myths - directly challenges both plate tectonics and the long-held view (in the West) that the mass of petroleum is “fossil fuel”. It is the first time at an important international geological conference that a session like Un-Traditional Theories and Ideas in Global and Large Scale Geology – in which fundamental geological and physical concepts were challenged and in their place comprehensive new propositions were presented in their place – was considered a highlight of the whole conference. ... In the oral session ... there was general consensus that subduction, and therefore plate tectonics, is mechanically impossible.

The alternative propositions varied from constant size to changing size (expanding) Earth. The importance of horizontal versus vertical movements, as well as of heat/molten Earth interior versus a solid Earth interior were debated, either as combined or independent issues. The poster session also covered a wide spectrum of subjects, from “hot” shales, sedimentary basins, interpretation of magnetotelluric and seismic surveys, the need for cooperation between geoscientists and engineers, great circles and expanding Earth, igneous diapirism, vertical tectonic movements, deep oil and gas reservoirs, to oil in granites.

http://geoheresy.bigblog.com.au/post.do?id=187219
Click to expand...

AAPG & AAPG program notes: http://aapg.confex.com/aapg/2007int/techprogram/meeting_2007int.htm
 
Abiogenic Hydrocarbon Production at Lost City Hydrothermal Field

Science 1 February 2008:
Vol. 319. no. 5863, pp. 604 - 607
DOI: 10.1126/science.1151194

Reports
Abiogenic Hydrocarbon Production at Lost City Hydrothermal Field
Giora Proskurowski,1,2* Marvin D. Lilley,1 Jeffery S. Seewald,2 Gretchen L. Früh-Green,3 Eric J. Olson,1 John E. Lupton,4 Sean P. Sylva,2 Deborah S. Kelley1

Low-molecular-weight hydrocarbons in natural hydrothermal fluids have been attributed to abiogenic production by Fischer-Tropsch type (FTT) reactions, although clear evidence for such a process has been elusive. Here, we present concentration, and stable and radiocarbon isotope, data from hydrocarbons dissolved in hydrogen-rich fluids venting at the ultramafic-hosted Lost City Hydrothermal Field. A distinct "inverse" trend in the stable carbon and hydrogen isotopic composition of C1 to C4 hydrocarbons is compatible with FTT genesis. Radiocarbon evidence rules out seawater bicarbonate as the carbon source for FTT reactions, suggesting that a mantle-derived inorganic carbon source is leached from the host rocks. Our findings illustrate that the abiotic synthesis of hydrocarbons in nature may occur in the presence of ultramafic rocks, water, and moderate amounts of heat.

1 School of Oceanography, University of Washington, Seattle, WA 98195, USA.
2 Woods Hole Oceanographic Institution, Woods Hole, MA 02543, USA.
3 Department of Earth Sciences, ETH-Zentrum, Zurich, Switzerland.
4 National Oceanic and Atmospheric Administration (NOAA)–Pacific Marine Environmental Laboratory, Newport, OR 97365, USA.

http://www.sciencemag.org/cgi/content/abstract/319/5863/604
 
david dissadent said:
Film

A great little film that focuses on the science of oil from the Australian ABC.

Sounds a bit ropey for the first 3 minutes.
Click to expand...


Sounds a bit ropey all the way through if you ask me, dave. The science the little film focuses on turns out to be a rehash of the squashed fish hypothesis which goes something like this:

math07.gif
 
bigfish said:
Sounds a bit ropey all the way through if you ask me, dave. The science the little film focuses on turns out to be a rehash of the squashed fish hypothesis which goes something like this:

math07.gif
Click to expand...
Sorry but what is ropey about it? Organic material collects on the bottom of shallow seas and over tens of millions of years heat and pressure alter the chemestry to simpler hydrocarbons. The chemestry is on pretty solid grounding.

Abiogenic oil requires the oil to form at great depths where the temperatures are so high that the long chain hydrocarbons would be broken down and only much shorter chained hydrocarbons could exists, they tend to be things like methane. Kerogans cannot remain in that form at the temperatures deep within the crust.

How much chemestry do you know?
 
bigfish said:
Science 1 February 2008:
Vol. 319. no. 5863, pp. 604 - 607
DOI: 10.1126/science.1151194

Reports
Abiogenic Hydrocarbon Production at Lost City Hydrothermal Field
Giora Proskurowski,1,2* Marvin D. Lilley,1 Jeffery S. Seewald,2 Gretchen L. Früh-Green,3 Eric J. Olson,1 John E. Lupton,4 Sean P. Sylva,2 Deborah S. Kelley1

Low-molecular-weight hydrocarbons in natural hydrothermal fluids have been attributed to abiogenic production by Fischer-Tropsch type (FTT) reactions, although clear evidence for such a process has been elusive. Here, we present concentration, and stable and radiocarbon isotope, data from hydrocarbons dissolved in hydrogen-rich fluids venting at the ultramafic-hosted Lost City Hydrothermal Field. A distinct "inverse" trend in the stable carbon and hydrogen isotopic composition of C1 to C4 hydrocarbons is compatible with FTT genesis. Radiocarbon evidence rules out seawater bicarbonate as the carbon source for FTT reactions, suggesting that a mantle-derived inorganic carbon source is leached from the host rocks. Our findings illustrate that the abiotic synthesis of hydrocarbons in nature may occur in the presence of ultramafic rocks, water, and moderate amounts of heat.

1 School of Oceanography, University of Washington, Seattle, WA 98195, USA.
2 Woods Hole Oceanographic Institution, Woods Hole, MA 02543, USA.
3 Department of Earth Sciences, ETH-Zentrum, Zurich, Switzerland.
4 National Oceanic and Atmospheric Administration (NOAA)–Pacific Marine Environmental Laboratory, Newport, OR 97365, USA.

http://www.sciencemag.org/cgi/content/abstract/319/5863/604
Click to expand...
Cutting and pasting an abstract of a scientific paper is pretty meaningless. Please clarify exactly what you see here and what I can argue against.
 
Brazil official cites giant oil-field discovery

The Associated PressPublished: April 14, 2008

SÃO PAULO: The head of Brazil's National Petroleum Agency said Monday that a deep-water exploration area in the Atlantic Ocean could contain as much as 33 billion barrels of oil.

If true, that would make the field one of the largest oil reserves in the world - and the largest find in decades.

Haroldo Lima, the director of the agency, cautioned that his information on the field off the coast of Rio de Janeiro was unofficial and still needed to be confirmed.

The state-run Petrobras oil company declined to comment.

The discovery by Petrobras was in partnership with Repsol-YPF and BG Group.

If it contains 33 billion barrels of oil equivalent, the discovery could be five times the recent giant Tupi discovery in Brazil, and it would further boost Brazil's prospects as an important world oil province and the source of new crude in the Americas.

Petrobras shares jumped 6.23 percent to 83.50 reais on the news, reversing early losses.

"It could be the world's biggest discovery in the past 30 years, and the world's third-biggest currently active field," Lima told reporters.

He would not say whether the reserve estimate was recoverable or in-place.

Petrobras last year put Tupi's recoverable reserves at between five billion and eight billion barrels of oil equivalent, most of it light oil.

"It's subsalt, and we knew there were big expectations for the subsalt cluster in addition to Tupi," said Sophie Aldebert, associate director with Cambridge Energy Research in Brazil. "But if this is confirmed, it's really huge."

Subsalt oil refers to reserves lying below salt layers. The offshore Gulf of Mexico contains numerous subsalt-producing fields.

"With that size, you'd have plenty of gains of scale that could easily offset the subsalt geological challenges," she added. The challenges include shifting salt clusters that require reinforced piping and producing in deep waters from huge depths under the ocean floor.

If the reserves are confirmed, Brazil could jump into the top 10 countries by reserves, surpassing countries like Nigeria.
Click to expand...

http://www.iht.com/articles/2008/04/14/business/14oil.php

;)
 
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