From Energy Bulletin:
by Mattie Porte
On the last day of the conference, Richard Heinberg was warmly welcomed back for his second presentation.
Last night he gave us ‘Peak Everything: Waking Up to the Century of Declines.’ Now that he’d warmed us up, he said he’d come back to try out some new ideas he’d working with over the past few weeks.
“It’s all a big unknown,” he admitted, but had decided we were the kind of audience that could handle the unknown. Where are we? Where are we going? Richard invited us to journey together with him in this exercise in strategic thinking and see where it would lead. Based on his background, research and experience, Richard has formed 8 assumptions:
Assumptions
1. Global oil production is near its all-time maximum and will begin to decline in the next couple of years, with gas and coal not far behind. The peak discovery was in 1964. The polar regions and the Falklands are now open for exploration. Field sizes are declining — these are flooding environments. Even if there are sizeable oil fields, it will take decades to get them going.
The United States peaked in 1970 after having been the foremost producer and exporter, half of the oil coming from Texas and Oklahoma in the 1930’s and ’40’s. The strategies they applied were:
* More exploration - this led to the discovery of oil in Alaska and the Gulf of Mexico which turned the tide temporarily.
* New technologies - water/nitrogen flooding of fields which again helped temporarily, but didn’t change the direction of decline. Technologies do work, Richard says, but only to a certain extent.
In the United Kingdom, the North Sea peaked in 1999 and in the last 8 or 9 years has declined by half. Britain is now a net importer of oil.
Richard’s colleague, Chris Skrebowski, Editor of Petroleum Review, has come up with the best definition Richard has heard of peak oil, that is:
“Global production falls when loss of output from countries in decline exceeds gains in output from those that are expanding.”
From the standpoint of regular crude oils, the world has been producing 74 million barrels a day even as prices exploded through the ceiling at 107 dollars per barrel as of 27 March, 2008.
There is an impact due to our reliance on the export market. The economies of Saudi Arabia, the United Arab Emirates, and Russia are expanding and therefore using more energy. That’s where consumption is rising most quickly, along with China. In the case of Russia, its domestic consumption has overtaken most of that increase and the country’s exports are declining now. The picture looks grim because available exports will decline fast and by 2020 - 2025 could disappear.
The British coal industry is virtually gone. The United States has only 250 years of coal left. What is happening to the world’s coal? Estimates are based on reserve to production ratio which assumes that consumption will be static; however, it rises dramatically each year, so the estimates are never accurate and reserves tend to be overestimated anyway. Over the last year, several groups have been looking at global coal supplies and have concluded that global coal production could peak in the next 20 years.
Total energy from fossil fuels will peak out in 2010 and according to Richard, it’s all downhill from here in terms of energy from fossil fuels. This doesn’t mean we’ll see a peak in carbon emissions in 2010 because coal consumption is expanding while oil and natural gas consumption is levelling off and declining.
2. Consequences will be severe. A study was done for the US Department of Energy in 2005 which examined three scenarios based on when work on the problem of peak oil in the world were to start in terms of developing an alternative food, fuel, transport structure, etc. The three scenarios were:
* develop strategies 20 years prior
* develop strategies 10 years prior
* wait until peak oil happens then react.
The Executive Summary of the study report said, ‘The peaking of world oil production presents the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically and without timely mitigation, the economic, social and political costs will be unprecedented. This will be a bigger problem than either the Great Depression or WWII.’ The word unprecedented was used twice just in the executive summary — something Richard thought might be unprecedented itself for a government executive summary.
Article Continues @ Sourced Site.
*Special Thanks to Relocalize.net and WCPO for this Article.
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