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Responses from The Oil Drum to Michael Lynch's NYT essay on Peak Oil

14 points by RyanMcGreal 17y ago

Retric 17y ago
I can't help but applauded how the third chart is manipulated to show trends that don't really exist by hiding the post 92 oil numbers in the US. Not only does it make the trend look worse, but it also let's them use fishy numbers for reaming oil in the US without raising alarm bells. Failing to adjust for inflation and starting at 1930 is also well played. http://zfacts.com/p/318.html http://zfacts.com/p/318.html
cwan 17y ago
To see energy in context solely as Peak Oil is myopic. There is more energy in the Marcellus Shale Gas (http://geology.com/articles/marcellus-shale.shtml http://geology.com/articles/marcellus-shale.shtml) than oil in Saudi Arabia - and this is energy that no one thought economical to extract or even knew was there until the last 2-3 years when new extraction technologies matured. But that's not the extent of it, there are massive deposits being discovered across the US and Canada and there are believed to be significant deposits in China, India, Europe and Africa. Check out this presentation out that Paul Kedrosky linked to: http://paul.kedrosky.com/archives/2009/08/the_grand_energ.html http://paul.kedrosky.com/archives/2009/08/the_grand_energ.ht.... But just look at the prices of oil and natural gas and see how they've dramatically separated. Heck, even with oil, they only recently discovered the massive Tupi field off the coast of Brazil - with an estimated 5-8 billion barrels of oil (http://finance.yahoo.com/news/Alternative-energy-powerhouse-apf-112344329.html?x=0&sec=topStories&pos=main&asset=&ccode= http://finance.yahoo.com/news/Alternative-energy-powerhouse-...)
- Devilboy 17y ago
  But surely you have to agree that there will be a peak at some point, I mean we're pumping oil much faster than the rate at which new deposits form in the earth, right?
  - eserorg 17y ago
    I am in the oil business. When laypeople who don't know the first thing about the hydrocarbons industry start talking about "peak oil", they come off sounding as stupid as when former senator Ted Stevens described the internet as a "series of tubes" that can get clogged up. The world has sufficient hydrocarbons to last hundreds and hundreds and hundreds of years. And there is no limit to human ingenuity in inventing new technology to economically produce those resources. Any nation, company, or individual that bets on 'peak oil' is doing so on an ideological basis and is going to loose big. Having people who have never set foot on a drill rig babbling on about 'peak oil' is tantamount to someone who doesn't understand computing betting against Moore's Law. For example: The combination of swell packers for multi-stage fracture stimulation of multi-lateral wells in tight oil and shale gas resource plays, coupled with multi-azimuth 3D seismic for detecting naturally occurring fracture networks,and microseismic for frac job design has completely revolutionized the US hydrocarbons business in the past few years. These are new technologies applied to produce oil and gas resources that used to be considered uneconomic. Every now and then you hear some talking head warning about how Moore's Law is about to stop scaling. Meanwhile, Intel keeps adding new process technologies to their roadmap. Does the semiconductor industry have the technology in 2009 to build some of these fab's? No. Will the industry invent the technology to build that fab? Yes. It's the same thing with hydrocarbons. BTW, a lot of the advances in semiconductor process technology are being used to discover new reserves of hydrocarbons. For example, one of the leading applications of NVIDIA's gp-gpu technology is for 3D-Seismic oil and gas exploration.
    - Devilboy 17y ago
      I don't quite follow - are you saying that we won't see a peak for at least several hundred years?
      - eserorg 17y ago
        Yes, there will be no net decline in the aggregate production of hydrocarbons, as measured in BTU's, for hundreds of years. We are currently learning how to develop and consume natural gas, a so-called 3rd-generation hydrocarbon, with a carbon-to-hydrogen ratio of 1-to-4. Natural gas was considered a waste product well into the 20th century. You have to take into account the fact that there are entire classes of hydrocarbons which human civilization has not yet attempted to develop. For example, just this past week, the US DOE published an article in Science announcing the discovery of large methane hydrate deposits in the Gulf of Mexico.
- RyanMcGreal 17y ago
  You're ignoring rate of extraction. There could be a trillion barrels of oil in some new non-conventional field, but it doesn't do a lot of good if you can't get more than 2 or 3 mbpd out of it.
  - eserorg 17y ago
    You need to lookup the hyperbolic decline curves for United States shale gas plays. With these 'unconventional' plays, the production is front-loaded. For instance, many Haynesville shale natural gas wells will produce as much gas in their first 6 months of life as they will over the next 20 years. The same goes for the Bakken tight-oil play in Montana. The 'rate of extraction' in unconventional oil and gas plays is extremely front-loaded. Which is why you see such large location basis price differential around these plays. In other words, the United States is producing so much natural gas that we're running out of pipelines, storage facilities, and power plants to consume it all. There is so much natural gas in the United States that the US should be a net energy exporter. However, the federal government has not approved a single permit for a natgas export terminals in over 40 years. Import terminals get approval on a regular basis, however. Meanwhile, we're complaining about our dependence on foreign oil and subsidizing windmills. Genius.

14 points by RyanMcGreal 17y ago

I can't help but applauded how the third chart is manipulated to show trends that don't really exist by hiding the post 92 oil numbers in the US. Not only does it make the trend look worse, but it also let's them use fishy numbers for reaming oil in the US without raising alarm bells. Failing to adjust for inflation and starting at 1930 is also well played. http://zfacts.com/p/318.html http://zfacts.com/p/318.html

cwan 17y ago

To see energy in context solely as Peak Oil is myopic. There is more energy in the Marcellus Shale Gas (http://geology.com/articles/marcellus-shale.shtml http://geology.com/articles/marcellus-shale.shtml) than oil in Saudi Arabia - and this is energy that no one thought economical to extract or even knew was there until the last 2-3 years when new extraction technologies matured. But that's not the extent of it, there are massive deposits being discovered across the US and Canada and there are believed to be significant deposits in China, India, Europe and Africa. Check out this presentation out that Paul Kedrosky linked to: http://paul.kedrosky.com/archives/2009/08/the_grand_energ.html http://paul.kedrosky.com/archives/2009/08/the_grand_energ.ht.... But just look at the prices of oil and natural gas and see how they've dramatically separated. Heck, even with oil, they only recently discovered the massive Tupi field off the coast of Brazil - with an estimated 5-8 billion barrels of oil (http://finance.yahoo.com/news/Alternative-energy-powerhouse-apf-112344329.html?x=0&sec=topStories&pos=main&asset=&ccode= http://finance.yahoo.com/news/Alternative-energy-powerhouse-...)

Devilboy 17y ago
But surely you have to agree that there will be a peak at some point, I mean we're pumping oil much faster than the rate at which new deposits form in the earth, right?
- eserorg 17y ago
  I am in the oil business. When laypeople who don't know the first thing about the hydrocarbons industry start talking about "peak oil", they come off sounding as stupid as when former senator Ted Stevens described the internet as a "series of tubes" that can get clogged up. The world has sufficient hydrocarbons to last hundreds and hundreds and hundreds of years. And there is no limit to human ingenuity in inventing new technology to economically produce those resources. Any nation, company, or individual that bets on 'peak oil' is doing so on an ideological basis and is going to loose big. Having people who have never set foot on a drill rig babbling on about 'peak oil' is tantamount to someone who doesn't understand computing betting against Moore's Law. For example: The combination of swell packers for multi-stage fracture stimulation of multi-lateral wells in tight oil and shale gas resource plays, coupled with multi-azimuth 3D seismic for detecting naturally occurring fracture networks,and microseismic for frac job design has completely revolutionized the US hydrocarbons business in the past few years. These are new technologies applied to produce oil and gas resources that used to be considered uneconomic. Every now and then you hear some talking head warning about how Moore's Law is about to stop scaling. Meanwhile, Intel keeps adding new process technologies to their roadmap. Does the semiconductor industry have the technology in 2009 to build some of these fab's? No. Will the industry invent the technology to build that fab? Yes. It's the same thing with hydrocarbons. BTW, a lot of the advances in semiconductor process technology are being used to discover new reserves of hydrocarbons. For example, one of the leading applications of NVIDIA's gp-gpu technology is for 3D-Seismic oil and gas exploration.
  - Devilboy 17y ago
    I don't quite follow - are you saying that we won't see a peak for at least several hundred years?
    - eserorg 17y ago
      Yes, there will be no net decline in the aggregate production of hydrocarbons, as measured in BTU's, for hundreds of years. We are currently learning how to develop and consume natural gas, a so-called 3rd-generation hydrocarbon, with a carbon-to-hydrogen ratio of 1-to-4. Natural gas was considered a waste product well into the 20th century. You have to take into account the fact that there are entire classes of hydrocarbons which human civilization has not yet attempted to develop. For example, just this past week, the US DOE published an article in Science announcing the discovery of large methane hydrate deposits in the Gulf of Mexico.
RyanMcGreal 17y ago
You're ignoring rate of extraction. There could be a trillion barrels of oil in some new non-conventional field, but it doesn't do a lot of good if you can't get more than 2 or 3 mbpd out of it.
- eserorg 17y ago
  You need to lookup the hyperbolic decline curves for United States shale gas plays. With these 'unconventional' plays, the production is front-loaded. For instance, many Haynesville shale natural gas wells will produce as much gas in their first 6 months of life as they will over the next 20 years. The same goes for the Bakken tight-oil play in Montana. The 'rate of extraction' in unconventional oil and gas plays is extremely front-loaded. Which is why you see such large location basis price differential around these plays. In other words, the United States is producing so much natural gas that we're running out of pipelines, storage facilities, and power plants to consume it all. There is so much natural gas in the United States that the US should be a net energy exporter. However, the federal government has not approved a single permit for a natgas export terminals in over 40 years. Import terminals get approval on a regular basis, however. Meanwhile, we're complaining about our dependence on foreign oil and subsidizing windmills. Genius.