Peak oil a hoax? Prove it.

[Infernal Optimist]

winterl2,

Thanks for the reply. Hey, I'll buy the beer but the shipping costs from here to Oz might be prohibitive!

Osculum Infame posted on abiotic oil

Yeah, I guess I need to qualify. I'm not sure OI would even believe that at present consumption the hoped-for decades long abiotic generation would keep us from running out (as I've defined it).

we've passed peak of the good oil

I understand your concern. All oil is not equal, either for extraction or for cracking.

Why would they [Saudis want to reduce prices] at all?

Two things: One you pointed out - high prices destroy demand and their whole economy runs on oil. Secondly, high, stable prices allow investments in alternatives (which could be bad for them long term).

I think we both agree on this:

price fluctuation makes investment a gamble

but this leads me to believe that they worry prices aren't going to remain where they are.

Investment has soared

Thanks for the links. Some of this may weaken what I had said, overgeneralizing. And the situation has changed since I looked at it in more detail a year or so ago. But I'd like to make a distinction. From your venture capital link it seems that investment has soared, mostly in bio-fuels. Now I may be forgetting your position but don't we both agree that bio-fuels as currently implemented are a scam? Using oil to grow corn, using oil to harvest corn, fermenting it and using oil to distill it may even be a net energy loser (I haven't looked into it in enough detail).

So, I'll concede investment increasing from 2005 (when I looked at it in detail) to 2006 (note to self: check current figures before spouting off). I see a big chunk of this being politically driven and possibly counterproductive (bio-fuels may not be interesting at all to investors without government-initiated benefits. I don't know).

peak oil is not falsifiable by price.

Well, I think that my intent is to use price and future price expectations to gauge the current situation (because it's my way of seeing what the thoughts are of the people who study this way more than I do). 10 years from now, if the Middle East is relatively stable and oil is >= $50(US)/bbl I think I'll have been mistaken about how much oil exists currently. Right now I'm thinking there's more than you probably think (based on our discussion).

[trachys]

I confess I haven't read through the entire thread, it may be that this has already been pointed out: one danger of accepting the crash hypothesis is that it might encourage an attitude of complacency among opponents of the state/empire. It's obviously reckless to assume that change for the better is inevitable.

[wintler2]

.. I'm not sure OI would even believe that at present consumption the hoped-for decades long abiotic generation would keep us from running out (as I've defined it).

Don't forget its not just present consumption we have to worry about. Doesn't every debt or deposit at interest demand increasing supplies of the natural capital that in fact underlie most if not all of the things humans have managed to put a price on. $110 repayment on $100 demands that $10 of value be created somewhere, and guess what its usually made out of: gas for commute, timber for papershuffling, coal/nuke for screen time, i'm sure you get my point. How much debt can be repaid from an unchanging or shrinking resource pool? We have some unlearning and relearning to do.

Why would they [Saudis want to reduce prices] at all?

Two things: One you pointed out - high prices destroy demand and their whole economy runs on oil. Secondly, high, stable prices allow investments in alternatives (which could be bad for them long term).

Both true, the second is limited by the vast investment we have sunk in liquid fuels. Some 'solutions' may be unworkable because you wont have the cheap energy and resources (lets not forget the steel copper rubber lithium aluminium ..) to eg. produce 70mil hybrid electric vehicles.

I think we both agree on this:

price fluctuation makes investment a gamble

but this leads me to believe that they worry prices aren't going to remain where they are.

Sure, all reason to think Saudis have motive to play supply to maximise price. They sure flooded market in 80s to crimp Irans Revolutionary govt. But you can't assume they still have the supply to do so, particularly when they're quite public about having available sour heavy crude but no unspoken-for sweet light.
Price fluctuation is one reason to put a floor under price with tax.

.. But I'd like to make a distinction. From your venture capital link it seems that investment has soared, mostly in bio-fuels. Now I may be forgetting your position but don't we both agree that bio-fuels as currently implemented are a scam?
Using oil to grow corn, using oil to harvest corn, fermenting it and using oil to distill it may even be a net energy loser (I haven't looked into it in enough detail).

So, I'll concede investment increasing from 2005 (when I looked at it in detail) to 2006 (note to self: check current figures before spouting off). I see a big chunk of this being politically driven and possibly counterproductive (bio-fuels may not be interesting at all to investors without government-initiated benefits. I don't know).

Fiscally they are an outrageous scam on US taxpayers, energy wise it seems to come down to situation, distance to mill&still, process used, source of heat, but yes its no bonanza (ie. much less than 10:1 energy return on invested, less than 1:1 some credibly argue). There will always be a case for making high-utility fuels at a net loss, after all thats what plants do, thanks gaia, storing less than 2% of incident solar energy. But its not something you could run even our grandparents civilisation on.

Don't think tho you can use the wrong-headedness of some 'renewables' investment as evidence of very much; its just shows how autistic we are about the fundamental challenges that life faces. Oil has made us dumb, and investors are still going for quickest easiest return, riding on coat tails of those taking the corp-states pork barrel coin, while stroking themselves that they're Green in some way. They don't yet have any need to worry about thermodynamics, they're still safely embedded in a system very adept at and active in liquidating natural capital.

peak oil is not falsifiable by price.

Well, I think that my intent is to use price and future price expectations to gauge the current situation (because it's my way of seeing what the thoughts are of the people who study this way more than I do). 10 years from now, if the Middle East is relatively stable and oil is >= $50(US)/bbl I think I'll have been mistaken about how much oil exists currently. Right now I'm thinking there's more than you probably think (based on our discussion).

The price you pay comes at huge cost, and isn't even guaranteed to provide good warning. Expect the externalities to show up on your borders (personal and national) in ever greater numbers. Hope i don't sound hostile, just trying to make my points, am grateful for yours.

[Infernal Optimist]

Hey wintler2,

Thanks for the discussion. I'm sending a cyber-beer your way.

One last thing:

Oil has made us dumb, and investors are still going for quickest easiest return

Isn't this the truth! Long term thinking these days is looking out to the end of next quarter! And I think we both agree that the time to start making these long-range changes is now.

[JoseFreitas]

Infernal Optimist, the fact that they might not have invested more money could in fact mean that they didn't expect to find any oil, rather than expect for prices to fall. Having tried to review the numbers I couldn't find the exact figures. I'll try over the next few days. I believe that investment has been growing continuously, and I believe most major oil companies believe that prices will remain at least at the 40$ plus. Note obviously that this MAY not have anything to do with Peak Oil, as it could be simply collusion and price fixing.

I think it is a mix of both, as there are other major problems today (infrastructure, refining, etc...). For instance, I read in a number of places that orders for large supertankers have dropped to almost zero over the last five years or so. Does this mean that the majors are not anticipating growing demand? Dos this mean Peak Oil? Demand destruction? At this point, even though I am a PO believer, it is still simply to early to tell what percentage PO represents of current price spikes. There are too many other distortions in the system, and demand destruction over the next year, for instance (if there is a recession) might add to this.

Best

[Infernal Optimist]

JoseFreitas,

Thanks for the reply. bluehost ate my post so I'll see if I can recreate it.

the fact that they might not have invested more money could in fact mean that they didn't expect to find any oil

That's wintler2's position. They've been looking for decades and already tapped the "easy" ones. Still I'd expect some otherwise unprofitable ones that they know about to be used if they expect prices to remain high. And you mentioned the Brazilian offshore sites which are only profitable at >$45(US)/bbl.

there are other major problems today (infrastructure, refining, etc...)

Good point. No new refineries in decades in the US since they would have to adhere to environmental regulations. So they expand old refineries (they're grandfathered in). But that's not sustainable.

The fact that Russia increased production through an act of will is interesting. Surely they are on pace to run out of oil within their borders within 20 years?

It's hard to know the supply situation when all the players are keeping things so close to the vest.

For now I can't buy into "Peak Oil Now."

[wintler2]

It's hard to know the supply situation when all the players are keeping things so close to the vest.

For now I can't buy into "Peak Oil Now."

I don't blame you at all. But would you agree that within twenty years looks most likely?

I'm quite prepared to believe in all sorts of cartel and price fixing behaviour by oil and related companies, just not to the point where they can or would hide significant volumes of oil (which I know you IO have never claimed, but others have implied).

Some news on the problems of oil co's (violins please). Could these outcomes be faked? Conceivable, but hard to see how those who would have to do the faking get coordinated and paid off by those who benefit.

Statoil says oil reserves at Snoehvit gas field in Arctic not profitable to produce
International Herald Tribune, Associated Press
http://www.iht.com/articles/ap/2007/01/ ... ts-Oil.php
OSLO, Norway: Statoil ASA said Thursday that it has abandoned hope of producing oil from its Snoehvit natural gas field in the Arctic Barents Sea, saying it would be too costly.

Snoehvit, which is due to begin production in December, had originally been planned as a pure natural gas field. However, last year Statoil and its project partners decided to study whether new technology, more information about the reservoirs and high crude prices could make it viable to also produce oil.

"The studies we have undertaken show that it still isn't possible to develop the oil reserves in a commercially viable manner," said Geir Pettersen, a Statoil senior vice president.
The Norwegian Petroleum Directorate has estimated that Snoehvit, which means Snow White, could have recoverable oil reserves of between 50 million and 100 million barrels.
(18 Jan 2007)
Contributor Mark writes: A recent article in our local newspaper pointing to the potentially enormous untapped reserves in the Barents Sea prompted me to do some research of my own and this is what I found. Other articles I came across described the huge costs of drilling in these arctic waters where weather is hostile and gargantuan icebergs are encountered.


Indonesia sees delay to 2010 for Cepu oil output
Muklis Ali, Reuters
http://today.reuters.com/news/articlein ... &type=qcna
JAKARTA - Oil production from the $2.6 billion Cepu oil and gas project in Indonesia will be delayed again and is now expected to begin in 2010, instead of the first quarter of 2009, energy watchdog BPMIGAS said on Monday.

State oil firm Pertamina and oil giant Exxon Mobil Corp. (XOM.N: Quote, Profile , Research) signed a joint-operation deal for the oilfield last March after a five-year deadlock, spurring hopes for speedy development of Indonesia's biggest untapped discovery to help reverse the country's shrinking oil output.

"There are many areas that are residential and also farms which are difficult to clear for upstream activities. We now expect output from the Cepu (field) to begin in 2010," Kardaya Warnika, BPMIGAS chief, told reporters. ..

In December, another BPMIGAS official said production from Cepu, expected to boost Indonesia's output by nearly a fifth, would start in the first quarter of 2009, with an initial output of around 25,000 barrels per day (bpd), itself a delay from an end-2008 target. ..

Officials had said that the local community wanted a very high price for its land.

Cepu is estimated to have recoverable reserves of up to 600 million barrels -- equivalent to about 6.7 percent of Indonesia's total -- and is expected to produce up to 180,000 barrels daily at its peak. Plans to build a refinery to process crude from Cepu have yet to make much progress. ..

Indonesia's crude oil production fell 0.58 percent to 857,000 barrels per day (bpd) in December from 862,000 bpd in November due to ageing fields, an official at BPMIGAS has said. ..
(22 Jan 2007)
courtesy of http://energybulletin.net/25372.html

[wintler2]

It's hard to know the supply situation when all the players are keeping things so close to the vest.

For now I can't buy into "Peak Oil Now."

I don't blame you at all. But would you agree that within twenty years looks most likely?

I'm quite prepared to believe in all sorts of cartel and price fixing behaviour by oil and related companies, just not to the point where they can or would hide significant volumes of oil (which I know you IO have never claimed, but others have implied).

Some news on the problems of oil co's (violins please). Could these outcomes be faked? Conceivable, but hard to see how those who would have to do the faking get coordinated and paid off by those who benefit.

Statoil says oil reserves at Snoehvit gas field in Arctic not profitable to produce
International Herald Tribune, Associated Press
http://www.iht.com/articles/ap/2007/01/ ... ts-Oil.php
OSLO, Norway: Statoil ASA said Thursday that it has abandoned hope of producing oil from its Snoehvit natural gas field in the Arctic Barents Sea, saying it would be too costly.

Snoehvit, which is due to begin production in December, had originally been planned as a pure natural gas field. However, last year Statoil and its project partners decided to study whether new technology, more information about the reservoirs and high crude prices could make it viable to also produce oil.

"The studies we have undertaken show that it still isn't possible to develop the oil reserves in a commercially viable manner," said Geir Pettersen, a Statoil senior vice president.
The Norwegian Petroleum Directorate has estimated that Snoehvit, which means Snow White, could have recoverable oil reserves of between 50 million and 100 million barrels.
(18 Jan 2007)
Contributor Mark writes: A recent article in our local newspaper pointing to the potentially enormous untapped reserves in the Barents Sea prompted me to do some research of my own and this is what I found. Other articles I came across described the huge costs of drilling in these arctic waters where weather is hostile and gargantuan icebergs are encountered.


Indonesia sees delay to 2010 for Cepu oil output
Muklis Ali, Reuters
http://today.reuters.com/news/articlein ... &type=qcna
JAKARTA - Oil production from the $2.6 billion Cepu oil and gas project in Indonesia will be delayed again and is now expected to begin in 2010, instead of the first quarter of 2009, energy watchdog BPMIGAS said on Monday.

State oil firm Pertamina and oil giant Exxon Mobil Corp. (XOM.N: Quote, Profile , Research) signed a joint-operation deal for the oilfield last March after a five-year deadlock, spurring hopes for speedy development of Indonesia's biggest untapped discovery to help reverse the country's shrinking oil output.

"There are many areas that are residential and also farms which are difficult to clear for upstream activities. We now expect output from the Cepu (field) to begin in 2010," Kardaya Warnika, BPMIGAS chief, told reporters. ..

In December, another BPMIGAS official said production from Cepu, expected to boost Indonesia's output by nearly a fifth, would start in the first quarter of 2009, with an initial output of around 25,000 barrels per day (bpd), itself a delay from an end-2008 target. ..

Officials had said that the local community wanted a very high price for its land.

Cepu is estimated to have recoverable reserves of up to 600 million barrels -- equivalent to about 6.7 percent of Indonesia's total -- and is expected to produce up to 180,000 barrels daily at its peak. Plans to build a refinery to process crude from Cepu have yet to make much progress. ..

Indonesia's crude oil production fell 0.58 percent to 857,000 barrels per day (bpd) in December from 862,000 bpd in November due to ageing fields, an official at BPMIGAS has said. ..
(22 Jan 2007)
courtesy of http://energybulletin.net/25372.html

[Infernal Optimist]

wintler2,

I owe you a thoughtful post but I'm short on time today.

But would you agree that within twenty years looks most likely?

For peak oil (and it's all downhill from there)? For having all the good stuff used up (and having to go heavier and sourer with more effort into pumping, cracking, pollution control)? I'm pretty agnostic on all this but I think within 10 years we'll have a pretty good idea where we stand (a total dodge, I know, but I'm not convinced that PO hits in 20 years).

I do think that in that time period there may be a good way to get Snow White's oil out. So that'll give us another day or two But I think that things like this will postpone any day of reckoning out past 20 years.

[wintler2]

Long time no contest on this thread, just wanted to leave a note saying please PM me if think have discovered or developed evidence supporting the Hoax argument, as i won't be reading RI board as often as lately (not miffed, just busy).

I think its fair to say that no coherent plan nor systematic evidence has been presented supporting the Hoax claims - a salutary lesson for any who had been tricked into believing it by posters who otherwise say 'all the right things'. Happily those empty-vessel posters seem to have stopped openly parroting the 'hoax' myth on this board at least, so i even feel the exercise was worthwhile. Thanks all for contributions.

[wintler2]

Having a tidying day today, school hol's & all, so thought i'd note here a few threads tangential to this one..

Peak skeptics:
Engineered Scarcity
William Engdahl: Global Elite Geopolitics

-

WikiLeaks cables show that it was all about the oil

[elfismiles]

Another useful thread with links to RI threads on Mike Ruppert's work on Peak Oil.

Michael Ruppert Sheldrake's Hundredth Monkey Fable
viewtopic.php?f=8&t=32293

[Elihu]

All of the oil we're burning today is of biotic origin

from our friend D-Mac

" "Perhaps the most telling quote to emerge from all of this came from Roger Sassen, identified as the deputy director of Resource Geosciences, a research group out of Texas A&M University: "The potential that inorganic hydrocarbons, especially methane and a few other gasses, might exist at enormous depth in the crust is an idea that could use a little more discussion. However, not from people who take theories to the point of absurdity. This is an idea that needs to be looked into at some point as we start running out of energy. But no one who is objective discusses the issue at this time."

The key point there (aside from Sassen's malicious characterization of Kenney) is his assertion that no one is discussing abiotic oil at this time. And why is that? Because, you see, we first have to go through the charade of pretending that the world has just about run out of 'conventional' oil reserves, thus justifying massive price hikes, which will further pad the already obscenely high profits of the oil industry. Only then will it be fully acknowledged that there is, you know, that 'other' oil.

"We seem to have plum run out of that fossil fuel that y'all liked so much, but if you want us to, we could probably find you some mighty fine inorganic stuff. You probably won't even notice the difference. The only reason that we didn't mention it before is that - and may God strike me dead if I'm lying - it is a lot more work for us to get to it. So after we charged you up the wazoo for the 'last' of the 'conventional' oil, we're now gonna have to charge you even more for this really 'special' oil. And with any luck at all, none of you will catch on that it's really the same oil."

And that, dear readers, is how I see this little game playing out. Will you be playing along? " endquote

"When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that justifies it."
– Frederic Bastiat

[Nordic]

now that's conspiracy theory.

[wordspeak2]

Anyone truly interested in this issue (and you should be, imho) should follow some of stickydog's links and think for yourself, not just respond to wintler2's passion. Also, one should really take the time to read Dave McGowan's articles on the subject, which are excellent, imo. I think it's telling that Engdahl was involved in the "Peak Oil" community for a long time and came to see it as a fabrication. Indeed, it's not hard to trace the "Peak Oil" meme to its crypto-fascists roots. Here's an article that does that: http://www.davesweb.cnchost.com/nwsltr55.html
I think the McGowan articles start here: http://www.davesweb.cnchost.com/nwsltr52.html

I've personally interviewed Michael Lynch, an investor who believes that "Peak Oil" is fraudulent. The fact is, the notion of "Peak Oil" is not accepted within investment circles- people whose wallets depend on this. And it is certainly not a question of, "The only question is when." If the Russian studies were correct and there is abiotic oil, then... well, that means it reproduces itself. But, *regardless,* to quote eco-socialist Walt Sheasby, from the first article posted:

"There is no reason for radical ecologists to join debates over the esoteric timetables for the decline of world oil production, which should be bracketed as irrelevant to the socio-political imperative of democratizing the economy and creating a new energy infrastructure that is based on post-capitalist norms of sustainability, sharing and community democracy. We must find ways of making the urgency of that transformation a motivation in people's lives and in their self-conscious anti-ideological politics. The dangers posed by global capitalism to human life and nature itself are all too real. We need to reject the posing of imminent danger as panic, as Chicken Little's alarm over the Falling Sky."

From a political perspective it's easy to see the negative effect of the "Peak Oil" meme. I'm involved in radical circles in a fairly rural area, and I've seen a lot- like a ton- of people get de-politicized and enter a "head for the hills" mentality over the supposed imminent "Peak Oil" crisis. It has a very de-politicizing effect. Folks who get really into the "Peak Oil" think get really individualist and survivalist, where they might otherwise have been politically active. For a lot of people it makes them welcome insanely high gas prices. Also, it creates a displacement of blame in what's wrong with the world from political fascism to over-consumption by common people. We all drive too much, that's the problem. Oh, really? And are we being set up for a martial-law moment, when the lights go out and the police state comes out? It's "Peak Oil," man; we did it to ourselves.

There's plenty of oil being produced, folks. More keeps being found all the time. Wall St. didn't get the memo about this alleged imminent catastrophe. However, oil is environmentally destructive, and it's a great *control-energy,* because shortages can be faked. I support switching to solar and wind; indeed, it's urgent. I think solar and wind are absolutely feasible, and if governments started subsidizing them it could happen in a relative heartbeat. But, no, not according to some of the "Peak Oil" gurus, like Richard Heinberg. Heinberg says that there isn't even enough oil left to build solar infrastructure! Oh my god, what are we gonna do?! The only answer, says Heinberg, is mass population die-off, at least half the species. Well, isn't that convenient for global fascism and the New World Order. Who are we gonna kill? How about some poor black people?

There is, indeed, an extremely imminent threat to the survival of the planet and its beautiful people; it's called CAPITALISM. Let's focus on that.