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Time to be honest about our energy prospects

THE problem is not that there is not enough coal left underground; there is. But the task of lifting it, transporting it and using it depends on many other factors, most importantly on the continued availability of oil as a lubricant for all the machines involved in the supply chain, and as a fuel for transportation. It is reckoned that there are some 109 years of coal left under current consumption assumptions according to a new report by BP, an energy producer.  Broadly that is in line with forecasts by the International Energy Agency (IEA) in Paris which also predicts the availability of other fuels. Discussions about fossil fuel reserves start by aggregating firm and expected supplies from known and almost unknown sources, equating the resulting volume against fairly loose forecasts of economic activity including the assumption that rising costs will be accepted by consumers. While the EROEI (Energy […]

Posted On : Published By : Tom Whipple
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IEA Says the Party’s Over

The International Energy Agency has just released a new special report called “ World Energy Investment Outlook ” that should send policy makers screaming and running for the exits—if they are willing to read between the lines and view the report in the context of current financial and geopolitical trends. This is how the press agency UPI begins its summary :  It will require $48 trillion in investments through 2035 to meet the world’s growing energy needs, the International Energy Agency said Tuesday from Paris. IEA Executive Director Maria van der Hoeven said in a statement the reliability and sustainability of future energy supplies depends on a high level of investment. “But this won’t materialize unless there are credible policy frameworks in place as well as stable access to long-term sources of finance,” she said. “Neither of these conditions should be taken for granted.” Here’s a bit of context […]

Posted On : Published By : Tom Whipple
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Peak Oil Is Not Coming…

It’s here. This IEA report spells out peak oil as being in the past . “Days of cheap energy over, IEA figures show” The IEA’s annual outlook on investment, released today, shows annual investment in new fuel and electricity supply has more than doubled in real terms since 2000. Costs to the oil and gas industry also have doubled in that period and the IEA warns of “gradual depletion of the most accessible reserves.” Canada is already seeing projects cancelled because of the high costs of developing the oilsands. And its contradictory stance on climate change  with rules for the oil and gas industry repeatedly delayed may contribute to future uncertainty. .@ vschmo @ traikman @ CBCNews Indeed, that report does describe the world as being past #PeakOil . No longer "in the future". #climatechange — John Klein (@JohnKleinRegina) June 03, 2014 There would be no “gradual depletion” if […]

Posted On : Published By : Tom Whipple
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BP And Royal Dutch Shell After Peak Oil

The oil industry used to be a no-brainer investment. There seemed to be an infinite supply of oil, and with more and more people owning cars, demand — and thus oil prices — were rocketing. This meant that oil companies would be booming. But has anyone asked the question: what happens when the oil runs out? Oil companies such as BP (LSE: BP.L – news ) (LSE: BP) (NYSE: BP) and Shell (LSE: RDSB.L – news ) (LSE: RDSB) (NYSE: RDS-B.US) are already finding that their production is falling. They are now scouring the furthest reaches of the planet for oil, from the Artic to the Gulf of Mexico and the South Atlantic. Oil is increasingly difficult to extract But any oil they do come across is increasingly difficult, and expensive, to extract. And the Macondo tragedy shows what can happen when the oil industry tries perhaps a little too […]

Posted On : Published By : ASPO-USA
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Has Technological Progress Made Peak Oil Theory Irrelevant?

In 1956, Marion King Hubbert, a prominent geologist for what is now Royal Dutch Shell (NYSE: RDS-A  ) , made a bold prediction. Based on an extensive analysis of reserves and production data, he concluded that U.S. crude oil production would peak at some point in the late 1960s or early 1970s, after which it would begin an inexorable decline. For decades, his dire prediction looked startlingly accurate. In 1970, U.S. oil production reached 9.6 million barrels a day — a level that hasn’t been equaled since — and then began to decline. It fell steadily from 1970 to 1976, and then rose modestly until 1985, after which it once again slipped into a steady decline that lasted for more than two decades. Hubbert’s prediction laid the path for what has since become known as peak oil theory, a highly influential theory that argues that global oil production is […]

Posted On : Published By : Tom Whipple
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Peak Oil: Is This Approach The Only Option?

The roster of Fellows at the Post Carbon Institute hardly strikes any reasonable person as a collection of bug-eyed extremists out to strike fear into the hearts of mere mortals everywhere. Disagree if one must with the conclusions they draw, but this think tank has shared with the public a variety of thoroughly-research, fact-based reports on energy, fossil fuel supplies, climate, and related issues. “Extremists” is not the first thought that comes to mind when reading the great body of work the Institute has created over the years. Unless of course you are one of the advocates of fact-free nonsense as policy still out there in full force peddling their views by stirring up their readership with less than admirable efforts to steer policy debates away from reality and into the rabbit hole of denial. Anything or anyone contradicting their narrow and self-serving interests is met with whatever arsenal […]

Posted On : Published By : Tom Whipple
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Canada’s high-cost oil and gas needs a competitive game plan

Canadian oil and gas companies will be competing head to head with lower-cost energy producers in the near future, and the country needs a better strategy to remain competitive in a post peak-oil world. According to a PwC report released May 30, Canada has four options when it comes to the future of oil and gas: continue relying on exports to the United States ; focus on building pipelines to either the west or east coasts to get oil and gas to offshore markets; or look to develop “unconventional resources” in Canada’s north. “As Canada moves from a focus on the US market toward exporting our oil production to world markets, it will fight for market share with nations that have strategic interests and the regulatory will to capture demand, particularly in the high-growth Asian market,” says the report. While Canada still has some of the largest oil reserves […]

Posted On : Published By : ASPO-USA
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Three Necessary Strategies Mitigating Peak Oil

“First is conservation. That’s the missing piece in most proposals for dealing with peak oil. The chasm into which so many well-intentioned projects have tumbled over the last decade is that nothing available to us can support the raw extravagance of energy and resource consumption we’re used to, once cheap abundant fossil fuels aren’t there any more, so—ahem—we have to use less. Too much talk about using less in recent years, though, has been limited to urging energy and resource abstinence as a badge of moral purity, and—well, let’s just say that abstinence education did about as much good there as it does in any other context. The things that played the largest role in hammering down US energy consumption in the 1970s energy crisis were unromantic but effective techniques such as insulation, weatherstripping, and the like, all of which allow a smaller amount of energy to do the […]

Posted On : Published By : ASPO-USA
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Converging Energy Crises – And How our Current Situation Differs from the Past

At the Age of Limits Conference , I gave a talk called Converging Crises  (PDF), talking about the crises facing us as we reach energy limits. In this post, I discuss some highlights from a fairly long talk. A related topic is how our current situation is different from past collapses. John Michael Greer talked about prior collapses, but because both of our talks were late in the conference and because I was leaving to catch a plane, we never had a chance to discuss how “this time is different.” To fill this gap, I have included some comments on this subject at the end of this post. The Nature of our Current Crisis The first three crises are the basic ones: population growth, resource depletion, and environmental degradation. The other crises are not as basic, but still may act to bring the system down. Humans have found a series […]

Posted On : Published By : Tom Whipple
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BP Loses Bid to Stall Spill Payments During Appeal

BP Plc (BP/) must pay hundreds of millions of dollars in damage claims while it seeks U.S. Supreme Court review of disputed payments in its $9.2 billion accord over the 2010 Gulf of Mexico oil spill, a court ruled. The U.S. Court of Appeals in New Orleans rejected the U.K.-based energy company’s request to maintain a temporary halt on payments to businesses that can’t prove they were directly damaged by the spill. BP settled with most private-party plaintiffs in 2012, initially estimating the cost of the agreement at $7.8 billion. The company contends a flawed interpretation by the claims administrator helped raise the price to $9.2 billion or more. A trial judge in December suspended payments to all businesses harmed by the spill, even those with losses unquestionably linked to the disaster, while the appeals court weighed BP’s concerns. On May 19, the court refused to reconsider its earlier […]

Posted On : Published By : Tom Whipple