Peak at 85 Million Barrels of Oil a Day
Oct 23rd, 2009 | By Byron King | Category: Featured, Oil
Eighty-five million barrels a day.
That’s the most that can be produced. So when recession causes a temporary decrease in world consumption, it can seem like those 85 million barrels are enough. But consumption is bound to resume its upward climb, while those 85 million barrels a day are all we get. The day of reckoning has just been delayed for a little bit.
“Can’t we get more than 85 million barrels?” some folks are bound to wonder. Let’s look into that.
Those Stubborn “Peak” Curves
This week I was in Denver, attending the 2009 conference of the Association for the Study of Peak Oil & Gas (ASPO). Despite all the happy talk in the Big Media about how the oil situation is under control, I assure you that the oil situation is NOT under control.
The market meltdown and world recession of the past year has bought some time, or stolen some time may be a better way of saying it. All the “peak” curves are still out there, but are merely adjusted a bit to the right on the timelines.
As Marine Corps Gunnery Sergeant R. Lee Ermey likes to say on the television show Mail Call, “Wipe that smile off your face.” We’re staring at an energy problem that’s coming down the tracks like a runaway freight train. It’s just astonishing that more people don’t appreciate the looming impact of Peak Oil.
Meanwhile, the politicians are fooling around with the health care issue. Hmmm… I have some news for them. If you screw up energy, health care isn’t going to matter very much.
Oil Output Not Increasing
It might be a comforting thought to believe that world oil output can increase. Indeed, many policymakers in the U.S. and Europe apparently dream themselves to sleep at night pondering how the current oil volume of about 85 million barrels per day could move upward to, say, 95 million barrels per day — “if only the world oil industry were more efficient.”
Yeah, right. Except the global oil industry is not that model of dreamland efficiency. Sure, there are some bright spots. The big internationals like Exxon Mobil, Chevron, BP, Shell, etc. are good. There are some really good state oil firms like Brazil’s Petrobras and Norway’s StatoilHydro. Saudi Aramco is outstanding. These guys are all doing great work to keep the world’s pipelines and tankers filled.
But much of the rest of the world’s oil industry lacks the knack for capital discipline and crisp project execution. Venezuela’s oil industry is a basket case, what with the Chavez-led nationalizations and mass firings of recent years. Output is falling in Venezuela, and this from a nation with among the largest hydrocarbon reserves anywhere in the world.
Mexico’s national firm, Pemex, is nothing but a piggy bank for the politicians, who suck most of the investment capital away from the oil patch and into their own boondoggles. Thus is Pemex walking off a cliff of underinvestment, depletion and decline. According to Matt Simmons, Pemex may not be exporting any oil at all to the U.S. within 18-24 months.
Iran’s oil industry is in a slow death spiral, despite the occasional report of Chinese assistance with field development. Apparently, there’s a “Twitter Revolution” going on in Iran that includes people at the grass roots impeding the oil industry. Well, it worked to depose the Shah back in 1979. Perhaps the Iranians can rid themselves of their mullahs in a similar way.
Next door in Iraq, chaos reigns. According to Matt Simmons, the Iraqis “are in the dark about how to run their oil industry.” The Iraqi oil legislation is so burdensome that almost all players within the international energy industry are spurning Iraq, including the Chinese. Wow. When the Chinese won’t invest in your oil fields, there MUST be something wrong.
And so it goes. The bottom line is that we should expect a global oil shock by 2012, or earlier if global economic activity kicks into high gear. It should go without saying that despite any calamities that may come from such a thing, you would be very happy if you’d taken advantage of lower oil prices to stock up.
Until we meet again,
Byron King
October 23, 2009
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By Marie Gunther
The United States has more oil reserves than Saudi Arabia but this happy though shocking information has been covered up for years.
The wells have been drilled, it’s merely a matter of turning on the faucets to supply America’s needs for 200 years.
These astounding revelations have been confirmed by a 30-year veteran oil exe cutive with leukemia who has decided to speak out.
In 1980, Lindsey Williams wrote a book, The Energy Non-Crisis, based upon his eye witness accounts during the construction of the Trans-Alaska pipeline. As a chaplain assigned to executive status and the advisory board of Atlantic Richfield & Co. (ARCO), he was privy to detailed information.
“All of our energy problems could have been solved in the ’70s with the huge discovery of oil under Gull Island, Prudhoe Bay, Alaska,” Williams said. “There is more pure grade oil there than in all of Sau di Arabia. Gull Island contains as much oil and natural gas as Americans could use in 200 years.”
Oddly though, immediately after this massive discovery, the federal government ordered the rigs to be capped and oil production shut down.
Developing Alaskan oil would make the United States completely independent of oil imports, Williams said in his book.
Why is the government covering up such good news? Why does it want to be dependent on imported oil? Do international financiers who are heavily invested in the oil industry want to keep the supply limited and prices up?
Will the Senate Energy and Natural Resources Committee, chaired by Sen. Frank Murkowski (R-Alaska), investigate what could be a criminal cover-up? Will the appropriate House committees in quire? Or the Justice Department? Since the cover-up has extended through four presidential administrations, only public outrage can force action.
“Everything you hear on the evening news and out of Washington is garbage,” said Jim Lawler, an oil production manager with ARCO. “Eight wells have already been drilled in the areas environmentalists are claiming we must not go in. We have already been in and out. There was no damage done. All we need to do is start production.”
The mainstream media is mind-molding public opinion by repeatedly showing running caribou, touting environmentalists’ claims that the caribou and other endangered species and habitats would be destroyed.
“The Alaska Fish and Game Depart ment just did a study on the por cupine car i bou in Prudhoe Bay. The size of the herds has increased since 1969 by 35 percent. The pipeline area is a protected designation and the caribou have figured this out. They have migrated into this area for protection,” Lawler said.
The Alaskan pipeline was built in 1977 and runs from Prudhoe Bay to the southern shores of Alaska in Valdez.
Lawler maintains that several things can be done to reduce American energy bills.
The Alaskan pipeline can be permitted to run at full capacity. In addition, the Department of Energy can allow a new pipeline to be built across Canada and con nected to the existing system in the United States.
Alaska can also ship oil to the West Coast immediately. Alaskan oil is of such high grade and low sulfur content that it can be utilized at any refinery, without damage to the environment.
“Currently, an estimated 4,000 barrels a day are liquefied at Prudhoe Bay, but government regulation controls that limit,” added Lawler.
Liquefying is the process by which oil sludge brought from the ground is pro cessed to be transported.
Lawler said the existing Alaskan pipe line was built to hold another four-foot diameter pipe above it, which could be used for natural gas. However, he said it “is not ne cessary because the Alaskan pipe line has never been permitted to run at full capacity.”
This same situation can be multiplied in Wyoming, Texas and other oil-productive areas across the country. The government has imposed strict orders not to produce.
And in a real emergency, Lawler contends hydrogen plants can sprout up in less than six months with just a nuclear reactor placed at sea.
“One nuclear reactor can power all of Los Angeles,” Lawler said.
Natural gas is readily available; Prud hoe Bay has 48 747-jet engines pumping one billion cubic feet of natural gas back into the ground 24 hours a day, 365 days a year. They have nowhere else to put the natural gas.
Lindsey Williams’s book, The Energy Non-Crisis, for $7 plus S&H by calling toll free 1-800-321-2900.
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work in oilfield… know reserves in u.s, alone a lot higher than are proven know a company bought old exxon field in orange tx drilled mile deeper they are producing in one well 9 190 bbls loads aday exxon field was old field they never went deeper to next zone new drilling methods more accurate new tech i n siesmology better, with what can come from jacks canyon so of new orleans production can be a lot higher big oil sand bagging figs like it did early 70’s oil crisis to raise prices .a new well in beaumont tx less than 5 miles from spindletop is producing a 100 bbls an hour it is at 14850 ft spindletop was very shallow well near salt dome all of southeast tx can be drilled deeper to new zones west beaumont new wells all big gas producers and many of the fields are bringing in rigs to go to deeper zones this area been producing oil since 1903 and it has just scratched the surface
Peak EASY oil. Again: Peak EASY oil. Still plenty of oil in the ground, just need a way to get it out.
http://dailyreckoning.com/oil-shale-reserves/
If it gets expensive enough, we can trust that some greedy capitalistic enterprising bugger will figure out a way to get at it!
Let’s hear it for enterprising greedy capitalistic buggers who at least produce things people want and are at liberty to purchase or decline to buy. We can modify our lifestyles to use less petroleum products fairly easily, and here is a suggestion that makes more sense than Obama telling you to air up your tires. Stack your errands up until one of them becomes URGENT, arrange all of them in a nice, neat circle with the grocery store last, and run all of them at one time. That is simple common sense and very few do it. I manage not to have to leave the ranch more than three times a month, and I could cut that to twice if I worked at it. Never mind that most of you must go to an office and return every day; what you do NOT have to do is dash around constantly to pick up fast food, go to the video store, or emergency trips because you are out of bread or milk. Running your private life should be a business, too. There is only so much money and time, so use both wisely.
Peak cheap oil is a problem–one you can take steps to protect yourself against. Switch to gas heat, drive diesel vehicles, reduce your usage in small ways that are not too annoying…
Peak WATER is a far worse one. Increasing government intervention and demands on the water supply, in addition to out of control population growth, are leading rapidly to shortages which were foreseen over fifty years ago. Longer than that, if we include that Malthus was right, it just took longer than he thought. For more thoughts on this subject see the comment I left under Gary’s article on Motor City.
Linda Brady Traynham