Quote:


That is kind of an unfortunate choice of term. You do realise that OPEC is all about reducing output right? And that other non-OPEC countries increase their production to capitalise?

freediver wrote on Jun 23^rd, 2010 at 8:26pm:


Not really, I thought it was quite apt, given the discussion!

freediver wrote on Jun 23^rd, 2010 at 8:26pm:


Well, even though I don't completely trust the EIA figures, they do provide some insight into Production and the results are of interest -

Of those countries producing reasonable volumes,
Production Up -
Canada (up on poorer quality non conventional Oil - Higher cost of Production)
Azerbaijan
Kazakhstan
Angola
Brazil
Russia (the big gainer in last few years, taking advantage of Pricing, but likely to start to decline, shortly - 2011?

Production Down - all substantially down on Peaks
Mexico
Venezuela
Norway
UK

Production Steady -
Oman
Iran
Kuwait
Qatar
UAE
Algeria
Libya
Saudi Arabia (steady, but down 10% in 2009, suggested Ghawar is in Decline)

Others -
Iraq - Up & Down over the years, reasonably steady since 1999, notable exception in 2003 when it dropped off the radar! Wonder why?

Australia - Reasonably steady, in recent years, but well below Peak , which was in 2000
http://tonto.eia.doe.gov/cfapps/ipdbproject/iedindex3.cfm?tid=5&pid=53&aid=1&cid...

Written in mid 2006, this contained 6 Possible, Major Influencing Events, including this one, relating to -




- First reports that production can not keep pace with consumption, due to insufficient reserves.

Event Start Date
- Within 5 years.

Event Outcome/s
- Significant, to rampant increase in Oil related product pricing.
- Significantly increase inflationary pressure.
- Significant problems, in replacing Oil base, in many product lines.
- Immediate, knee-jerk reaction to implement Nuclear power.
- Increased, subsequent push for Green alternatives.

Event Duration
- 20 to 30 years

Event Probabilities
- Within 5 years, 80 to 20.
- Worse Case Scenario, 60-40.

Canterell now Sub-500k bpd and Colin Campbell Talks Peak Oil

We’re getting closer to the edge – actually, we may have already fallen off the edge and are experiencing the side-effects of expensive oil. The erosion of the Canterell field in Mexico only increases US dependence on its quasi-enemies for economic growth.



The Cantarell fields were a relatively recent discovery, with most of its production going to the USA. However, as its production declines, the USA will be forced to look elsewhere for its third largest supplier of crude oil.
Cantarell Wiki link -
http://en.wikipedia.org/wiki/Cantarell_Field
==========
There is also a useful video at the following link, which is an interview of Colin Campbell, who is a Petroleum Geologist & Peak Oil specialist. This includes reference to the North Sea Oil having declined from its Peak in 1989 of around 4.5 million bpd, to a current production of around 1.5 million bpd.

http://www.planbeconomics.com/2010/06/29/canterell-now-sub-500k-bpd-and-colin-ca...

What we can see from this graph (note the inserted comment is by the author of this paper):

Crude oil production from known oil fields will dramatically decline by 85% over the next 10 years ( 1 – (105 + 0.14*152) / 890 = 0.85 )
This decline is offset by condensate from wet gas (mainly in LNG projects) but because of a lack of condensate splitters in Australian refineries 95% of this is exported.
The prospect for new oil discoveries is not very good. Geologically, Australia is better off with natural gas
Since global oil export volumes are shrinking at the same time (details below), Australia will slide into a huge oil import crisis. The government hopes coal-to-liquids, gas-to-liquids and 2nd generation bio fuels will come to the rescue but it is very uncertain whether that will materialize in the quantities required, at acceptable prices and the timeline dictated by events surrounding the global peaking of oil production.

These events in the next years include

an oil war or oil proxy war in the Middle East
social unrest in ME countries when declining OPEC oil production
impacts on budgets and subsidies for the general population
oil hoarding and freezing of oil markets when the truth comes out about OPEC’s overstated reserves and confidence in all oil reserve data disappears

In any case, the energy profit ratios of  alternative  fuels will be very low:

6/1/2010
Diminishing Returns of Fossil Fuel Energy Invested
http://www.crudeoilpeak.com/?p=909

Let’s check how the above graph compares with previous government reports. This figure 6 is from Geoscience Australia’s 2005 submission 127 to the Senate Inquiry on Oil Supplies:[2]



It shows 3 projections up to 2025: P10, P50 and P90. Each number denotes the probability in percent that this projection will actually occur. Strangely, the AERA report does not show different probabilities. So let’s superimpose the 2 graphs to see where we are:



We can see from the graph:

The actual crude production curve (black line 2006-2009) has just hit the P90 estimate from 2005. It remains to be seen whether it will follow the new projection (light blue columns)
A lot of condensate has been added and that assumes all LNG projects go ahead as planned.
Read more about:

Australian oil reserves and resources, how AERA omits Geoscience Australia’s conservative 2P reserves
AERA’s misldeading statement about “enough” oil for 42 years and a factually incorrect “balanced” oil supply
The problems with propane deficient LPG, propane imports on the East coast and butane exports from the West coast
Timelines about global net oil exports shrinking and Australia’s coming oil import crisis
Lack of a Strategic Oil Reserve
Need to save oil in a hurry
3 examples of road projects which make no sense in a period of declining oil production: new Clem7  road tunnel in Brisbane, Hunter freeway and Western freeway in Melbourne
by downloading the full article of 10 pages as PDF file:  Australian Crude Oil Decline 85 Percent Over 10 Years [1.27 MB]
Link -
http://www.crudeoilpeak.com/?p=1243
=====
I think that OZ became net Oil importers, again, around 2000-2002. If these charts become reality, then the cost of Oil (read Energy) to the Australian Economy will become much greater, over the next decade, as will our reliance on following the USA into Oil Conflicts!

Looking ahead to When the tank runs dry

Addiction is defined as the state of being enslaved to something to such an extent that its cessation causes severe trauma. It is usually associated with drugs or alcohol. But, my fellow citizens, we all have an addiction problem: we're addicted to fossil fuels: oil, coal and natural gas.


Hooked

We began falling under their spell during the industrial revolution, when the steam engine was invented. It ran on coal and vastly improved life for our forefathers because it did work previously done manually.

Steamships and locomotives came next, then power plants and the internal combustion engine that is still used in vehicles worldwide today. Plastics - derived from oil - revolutionized consumer products and nitrogen-based fertilizers - derived from natural gas - enabled us to grow more food.

As a result, today we consume nearly 50 times more fossil fuel than we consumed in 1850. In 2008, fossil fuels provided an incredible 86 per cent of the energy used by humanity worldwide. We rely on them to grow and process our food; to purify and pump our water; to run our hospitals and schools; and to get around.

We rely on them every day, in every way. We're truly addicted.


A looming supply problem

Compounding our problem is the fact that we are addicted to something non-renewable: once it's gone, it's gone.

Consider oil. Wells that supply water to our homes are virtually bottomless, because they are continuously refilled by groundwater. Oil wells are different: there's only so much oil down there, so they eventually run dry. Historically we've simply moved on and found new ones. As the old lumberjack's cry goes, "There's always more wood over the next hill!"

But our voracious addiction has meant that all the easy oil is now gone. In the past few decades, we haven't been as successful at finding new wells to replace the ones that are running dry.

These days, we're down to dirty tar sands or drilling offshore to find more oil - much like an addict reduced to using a vein in a toe because all other veins have become scarred beyond use. Both have huge environmental implications. Devastating as it is, the Deepwater oil spill in the Gulf of Mexico is a predictable consequence of our addiction.

Credible energy analysts such as Dave Hughes and Jeff Rubin (Why Your World Is About To Get A Whole Lot Smaller) believe the day when global oil demand exceeds supply is not very far away. It's called Peak Oil theory, and it has some troubling implications. The first will be higher prices, for just about everything. The next will be shortages, ditto.

When the supply of the substance that underpins your society starts to run tight, you're wise to be concerned. Cuba experienced turmoil when its oil supply dried up in 1989 after the collapse of the Soviet Union. It survived - but Cuba has no cold winter and can grow food year round. Canadians, far more addicted to fossil fuels than most, should be especially uneasy.


Rehab or cold turkey

If Peak Oil theory is true - and overwhelming logic offers no clear reason to doubt it is - we have an addiction to break, quickly.

We have two options: we can choose a rehab program that involves, in order: 1) greatly reducing our energy demand; 2) using what we do use as efficiently as possible; and 3) developing renewable energy sources.

Or we can choose to do nothing, and just let things come to pass. But that's unwise. It's better to plan for the day when there is no gas at the local station, than to simply show up one day with an empty tank to find there is none.
Link -
http://telegraphjournal.canadaeast.com/magazine/article/1131278
========
Try telling that to the folks on Easter Island?

The Chinese Coal Monster

•China set to consume 50% of global coal production this year
•Production and consumption roughly in balance
•Coal imports used for stock pile growth?
•Consumption growing >10% year on year in line with economic growth
•Rest of world consumption declined 7% in 2009









Threat to global economy
Should China ever fail to match coal consumption with indigenous production then 1 of 3 things may happen. The first option is that consumption is pegged back to match stalled production and this would stall Chinese economic growth with knock on effects to the global economy. The second option is that China tries to meet any shortfall buying coal on the international market. As already pointed out China is such a huge consumer of coal this would create great competition in the international market for limited supplies leading to severe upwards pressure on coal prices. The third option is that China somehow manages to install sufficient nuclear capacity to plug any energy gap
Link -
http://europe.theoildrum.com/node/6700
=========
There are other threats!