Sunday, August 13, 2006

Chicago Tribune Discusses Peak Oil

The Chicago Tribune talked about Peak Oil and quoted Matthew Simmons in an article that was part of a series in which the reporter tracked the gasoline in a station back to its original source, along the way discussing America's ridiculous dependence on oil. Here is the excerpt:

"I truly think we're at one of those turning points where the future's looking so ugly nobody wants to face it," said Matthew Simmons, an energy investment banker in Houston who has advised the Bush administration on oil policy. "We're not talking some temporary Arab embargo anymore. We're not talking your father's energy crisis."

What Simmons and many other experts are talking about is a bleak new collision between geology and geopolitics.

Below ground, the biggest worry is "peak oil"--the notion that the world's total petroleum endowment is approaching the half-empty mark, a geological tipping point beyond which no amount of extra pumping will revive fading oil fields. Peak oil theory is controversial. Many think it alarmist. Yet even Big Oil is starting to gird itself for possible fuel shortages: Chevron, the nation's second-largest oil company, has bluntly declared that "the era of easy oil is over" and is warning energy-hungry Americans that "the world consumes two barrels of oil for every barrel discovered."

Aboveground, things look little better. Most of the world's petro-states, aware that crude supplies are growing increasingly valuable, have limited drilling rights to their own oil companies.

In the meantime, humanity's thirst for petroleum continues to run wild. Producing nations are pumping at maximum capacity. Yet the competing energy demands of America and rapidly industrializing China and India now threaten to outstrip global oil output. China has displaced Japan as the No. 2 oil importer, after the United States. Chinese oil imports are projected to double to 14 million barrels a day over the next 20 years. Many credible analysts foresee a new "energy cold war" as the U.S. and China square off over the planet's last reserves.",0,7163057.htmlstory?coll=chi-homepagepromo440-fea

The Peak Oil Crisis: Portland Takes the Lead

Falls Church News-Press

By Tom Whipple

The Middle East , home to a third of the world's oil production, is coming unglued in so many ways and in so many places that it is nearly impossible to track. One would have to be a complete fool, however, not to recognize one of the manifold costs of all this chaos is going to show up on that big sign over your neighborhood gas station— shortly.

The roots of these conflicts go back two thousand years. They are not going to be settled in our lifetime or many lifetimes. There is very little any of us can do except to prepare for the consequences. As yet, with exception of Sweden , none of the major world governments have officially recognized that a decline in world oil production with potentially devastating consequences is imminent.

In the US , it is politically unthinkable for a government confronted by Iraq , Hezbollah , Iran , global warming, and numerous other woes to openly acknowledge peak oil and all that it implies. From time to time, they have dropped hints — "Energy Independence," "Advanced Energy Initiative," need to drill more, "addicted to oil" — but the administration has yet to openly acknowledge that one of the greatest crises the country has ever known is just over the horizon.

This total abrogation of responsibility by the federal government has led to a handful of local governments to start considering action on their own to prepare for what is sure to come. The furthest along is Portland , Oregon . In May, the City Council passed a resolution establishing a peak oil task force "to assess Portland 's exposure to diminishing supplies of oil and natural gas and make recommendations to address vulnerabilities."

The twelve "WHEREAS's" in Portland 's resolution (#36407 should you want to Google it) are a thing of beauty, for they make the case for an imminent and dangerous peaking of world oil production in a succinct and convincing manner. The City's planners have clearly done their homework well.

The charges to Portland 's peak oil task force are also worth noting:

1. To acquire and study current and credible data and information on the issues of peak oil and natural gas production and the related economic and other societal consequences;

2. To seek community and business input on the impacts and proposed solutions;

3. To develop recommendations to City Council in this calendar year on strategies the City and its bureaus can take to mitigate the impacts of declining energy supplies in areas including, but not limited to: transportation, business and home energy use, water, food security, health care, communications, land use planning, and wastewater treatment; and

4. To propose methods of educating the public about this issue in order to create positive behavior change among businesses and residents that reduce dependence on fossil fuels.

And there, in a nutshell, is a plan. At this stage, the plan may only be to study peak oil and its local consequences, but you have to start somewhere.

At last count, there were 87,576 governments in the United States (one federal, 50 state, 38,976 general-purpose local governments, and the rest special-purpose local governments such as school boards). Thus far, only Portland seems to be planning in public for peak oil.

Last week Portland 's government released a 93-page briefing book prepared by the city to acquaint their new task force with the basis for the City Council's concerns and to amplify on the guidance given in the resolution. The report discusses 14 areas that will be impacted by loss of cheap oil and gas and asks the task force to assess which are most relevant to Portland .

The areas of concern discussed are: Transportation, Land Use, Local Economy, Housing, Food, Public Services, Population shifts, Social Services, Health Services, Education, Electricity, Manufacturing, Retail and Communications.

In preparing this list, the City of Portland have done us all a big favor for they have moved the thinking about how to cope with the post-peak oil world forward another step. The message in the Portland report is that while we are all going to face peak oil, the effects on every one of those 87,576 governments is going to be slightly or a lot different.

Areas with sprawl will face massive commuting problems as gasoline becomes unaffordable, but in New York City , so long as the subway works, most people could care less. While feeding New York City may one day become a giant problem, rural America will continue to grow food way beyond what they consume. We are going to need 87,000 different solutions to mitigating peak oil.

As individuals, there is little most of us can do to keep oil flowing in the face of turmoil in the Middle East and nothing any of us can do in the face of peaking world production — other than to conserve.

There are however, still 87,575 governments in the US that, thus far, are doing absolutely nothing (at least in public) to prepare for peak oil. The chances are excellent that you live in one or more of them. Some day soon, each of these governments is going to have to face the consequences of peak oil. The sooner we can get governments thinking about it, they better off we, our children, and our grandchildren are going to be when that day comes.

Reaction to Peak Oil Starts Close to Home

Cowichan Valley News Leader (Canada)

By Pete Keber

Last month the Cowichan Valley Regional District overwhelmingly rejected a motion on peak oil.
That is a most disappointing development, since this issue threatens our way of life and our very existence.

The reasons given for turning down the motion are simple. It is a global issue that is not within the purview of the CVRD. The majority at the CVRD feel there is nothing that they can do about it.

This demonstrates a total lack of vision, and a failure to understand the consequences of ignoring this issue.

Other municipalities in North America comprehend the problem and are moving towards finding measures that they can undertake to mitigate the consequences at a local level.
In an e-mail I sent to the board recently, I suggested several steps that they could take to start the ball rolling here in the Cowichan Valley. I also went into more depth on what peak oil actually is.

For the uninitiated, peak oil occurs when approximately half of the world’s conventional oil supplies have been used up. At that point it is close to impossible to increase production any further. This happened to the United States in 1971.

It has never been able to pump as much of the black gold as it did that year, despite increased drilling, significant discoveries in Alaska and the Gulf of Mexico and continual advances in technology. Since then, another 53 to 55 of the major oil-producing nations have experienced peak production.

Is it not then reasonable to infer that this will happen on a global basis as well? Although it is helpful to know when that will happen (many experts believe global peak could occur between now and 2012), it is more important to do whatever we can now to lessen the impact.

There are two big arguments against peak oil advocates. The peak of oil production has been predicted several times in the past and it has not happened. The second counter is that recoverable reserves have continued to grow every year despite declining discoveries.

The first argument is not based on science, merely past failed predictions. A stopped clock…well you know the saying. How can we keep on increasing reserves if we are not discovering more than we are pumping?

In the 80’s the major Opec producers virtually doubled their stated reserves on paper with no major discoveries to back them up. This was to get around the new quota system.

Since then, those reserve numbers have stayed at the same levels despite extracting billions of barrels without replacing those barrels with new discoveries. Additionally, many major oil companies understated their reserves due to SEC requirements, than increased those reserves when they became provable.

Expectations that new technologies will increase the amount of oil being produced from oil fields has also helped to boost reported reserves. There may be phantom barrels in those reserves and there are limits to what technology can produce from finite fields, so all these numbers must be viewed with some suspicion.

We are not addicted to oil. We are addicted to convenience. A steady supply of cheap oil that has provided us with that convenience.

The thing is, we don’t care if it is oil or something else that ensures that convenience. The overarching problem: there is nothing on the horizon that can replace that gooey tar to guarantee a continuation of our gluttonous ride. Maybe nanotechnology can create a clean-burning alternative, but I wouldn’t hold my breath since that would contravene the first law of thermodynamics.

What will happen when peak oil occurs? My guess would be nothing immediately, but as shortages really start to hit escalating prices will impact the poor and developing nations. There will likely be scrambles by nations to secure their oil supplies and regional conflicts over resources. Whoa. That is already happening. Things can only get worse. The conflicts may spread to North America.

So what can we do? We can be a lot more conscientious about our vehicle use to start. North America consumes more than 25 per cent of the world’s oil supply with only five per cent of the population. We could reduce our consumption by 50 per cent if we set our minds to it without seriously limiting our lifestyles. Notice, I said limit and not change.

Either we change our style of living or wait until we are forced to. It is our choice. We can also lobby the CVRD to make peak oil mitigation a policy in the Cowichan Valley.

Pete Keber is a south Cowichan resident.

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