We were wrong on peak oil. There's enough to fry us all

By A Guy Called LULU on Tue, 07/03/2012 - 11:52am |

A boom in oil production has made a mockery of our predictions. Good news for capitalists – but a disaster for humanity

URL:

http://www.guardian.co.uk/commentisfree/2012/jul/02/peak-oil-we-we-wrong

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What Maugeri is claiming is that there is and will continue to be a boom in unconventional liquids — tight oil, synthetic oil from tar sands, synthetic oil from shale, coal to liquids (CTL), natural gas to liquids (GTL), and even ethanol from corn. The EIA’s Annual Energy Outlook 2012 does predict that production of these sources will increase from an aggregate 4.6 million barrels per day (mbpd) in 2010 to 17.1 mbpd by 2035, if prices stay high, which seems to support Maugeri's contention. If prices trend lower, EIA predicts that unconventional production will only increase to 13.0 mbpd.

So the boom will depend on the price of oil staying high enough to pay for unconventional extraction (horizontal or deepwater drilling), transport (Keystone XL) and refining (refitting for heavy sour oil). And as we saw in 2008, the price of oil depends on demand from a strong economy. By ravaging the US and Canadian environments, we will be able to offset the drop in conventional oil imports, but only if our economy, and the other economies we depend on remain strong enough to keep the price of oil high.

Meanwhile, world production of conventional oil is depleting 3-4 mbpd every year. From 2012 to 2035 depletion will be minus 69 to minus 92 mbpd. Does that bode well for a strong world economy?

by Donal on Tue, 07/03/2012 - 2:03pm

If I recall correctly, E.F. Shumacher, who wrote "Small is Beautiful", said in the sixties that it was inconceivable that enough new sources of oil could be found to sustain the planets growth curve for very much longer, and the alternative, that actually having an unlimited supply, would doom the planet to some very harsh changes.

"Peak oil hasn't happened, and it's unlikely to happen for a very long time." Maugeri.

The second part of that statement, as your comment indicates, is probably wrong even with all the new unconventional sources. Still, Maugeri is saying much the same thing as Shumacher except he thinks there is now enough oil to bring about the doom scenario, if it hasn't already.

I agree completely with Maugeri's summation except once again with his time frame.

"There is enough oil in the ground to deep-fry the lot of us, and no obvious means to prevail upon governments and industry to leave it in the ground. Twenty years of efforts to prevent climate breakdown through moral persuasion have failed, with the collapse of the multilateral process at Rio de Janeiro last month. The world's most powerful nation is again becoming an oil state, and if the political transformation of its northern neighbour is anything to go by, the results will not be pretty.

Humanity seems to be like the girl in Guillermo del Toro's masterpiece Pan's Labyrinth: she knows that if she eats the exquisite feast laid out in front of her, she too will be consumed, but she cannot help herself. I don't like raising problems when I cannot see a solution. But right now I'm not sure how I can look my children in the eyes."

Maugeri must not have grandchildren yet. It will be even tougher for him when he does.

by A Guy Called LULU on Tue, 07/03/2012 - 8:00pm

I meant to thank you for the link to The Sky is Pink and to second the recommendation for everyone to watch it. I almost missed it because it was in The Creative Corner.

by A Guy Called LULU on Tue, 07/03/2012 - 8:05pm

OK, that's George Monbiot's summation, but he's using the numbers from a report by Leonardo Maugeri, a former oil exec from Italy. Monbiot is primarily worried about climate change, and grasps around for alternatives to fossil fuels like nuclear power.

Peak Conventional Oil happened in 2005, but Peakists (at least the ones I was reading) never anticipated that A - the economy could contract and reduce demand without mayhem in the streets, and B - the fossil fuel industry would go to such lengths to extract anything else that smelled like oil. So we're effecting habitat change to prolong climate change.

by Donal on Tue, 07/03/2012 - 9:04pm

Treehugger, Monbiot and Is Peak Oil Over?

I can’t really blame George Monbiot or anyone else for buying the narrative hype. Right now the overwhelming narrative is that we have no energy constraints at all. Folks wonder aloud whether the US should join OPEC. Increasingly ridiculous projections are made about the potential of shale oil and new drilling techniques. Slight upticks are assumed to be headed to their logical extremes, and Harvard’s Kennedy School of Government issues a report saying we’ve got all the oil we could ever want. So is it really surprising that Monbiot, who has been focused on climate change, not peak oil, is buying the story, asks Treehugger? Treehugger also offers a great link to Heading Out’s Oil Drum Rebuttal to the Harvard Report, which notes that this is based on a whole lot of assumptions including capacity for production that Saudi Arabia has claimed but never demonstrated, a huge leap in Iraqi oil production, which everyone has said will happen any day now since 2003 and hasn’t, and a lot of overstatements of US shale production:

by Donal on Wed, 07/04/2012 - 7:24pm

We were wrong on peak oil. There's enough to fry us all

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