Investing Into the End of the Hydrocarbon Age 35 comments
-
Font Size:
-
Print
- TweetThis
Wednesday two idea clusters rose above the myriad others that floated in, out, and around my mind. One started my day, the other came near the end. They stood in juxtaposition like The Future and The Past. Together I think they point to an important feature of our Rapid Transition from the Hydrocarbon Age toward the Electron Age.
The first idea cluster came at a breakfast presentation by Marshall Goldman, the urbane, erudite former Wellesley professor and Russian expert who recently wrote Petrostate: Putin, Power, and the New Russia. Goldman’s delightful lecture at New York’s Carnegie Council for Ethics in International Affairs, painted a picture of the enormous rise in wealth and status of Russian business people and the Russian state which shows every indication of expanding continuously over the next decades. There is no doubt that high oil and gas prices have dealt Russia a hand with four aces. Goldman is a good observer and reporter; his narrative seemed compelling and full of significance.
The Chevy Volt idea cluster came toward the end of my day as I read this report about General Motors’ (GM) soon-to-be-marketed plug-in electric hybrid car. It will be able to go 400 miles at over 100 mpg on a small tank of gas that simply helps to recharge the electric motor. The report says the car will be produced in volume - over 100,000 a year - after 2010, that the first models will be on the street “soon”, and that the car will be made in one of G.M.’s most visible plants located close to G.M. HQ. In other words, the Volt is to be a signature car for what G.M. hopes its future will look like, and it wants the world to know that. The Volt is a piece of industrial drama and it’s significance, like that of the rise of Russia, has broad implications for human affairs.
When you think about Russia and their great international infrastructure for natural gas distribution that their giant state gas monopoly Gazprom operates, the images you get are of huge, dirty, expensive pipelines - 6″ or 12″ or 18″ - buried under ground and even under seas collecting gas from distant, cold, inhuman fields and bringing it to all the people of Europe. And in the process making nearly everyone from London to St. Petersburg dependent on the continued good will of one man, Vladimir Putin, for the reliability of their heating and cooking systems.
When you think about the Volt, you see a sleek, nearly silent machine powered by invisible electrons that are generated relatively close to where they are consumed and distributed through small cables that are easily and rapidly laid - at least in comparison with a gas pipeline. The electrons may soon be generated directly from the energy of sunlight falling silently to earth at no cost converted to energy by concentrating solar thermal or wind or wave generators with no greenhouse gases. Or maybe the electrons come from falling water or from geothermal heat, also free inputs. No one man can hold anyone hostage for this energy source. The Age of Electrons will be the apotheosis of democracy translated to commerce.
These two important stories - the Volt and the Russians - are, like nearly all energy-related information clusters that come along during an average day, easily classified into one of these two categories - either “How the End of the Hydrocarbon Age is Unfolding” or “How the Age of the Electron Will Look and Will Impact Us.”
Probably 95% of these information clusters are of the former variety and maybe 5% are the latter. Both are useful. It’s important for us to understand how the Hydrocarbon Age will end because we will be living through that period for the next ten to twenty years and if we are to get through this period with the least damage and the most wealth left intact, we must do our best to understand it. So the experience and insights of Dr. Goldman are useful.
But let’s bear in mind, as we decide whether oil will next go down to $100 or up to $150 and more importantly whether we are at all prepared for the turmoil of the times when oil costs $500 in a few years, that as important as such questions are, they only deal with the dying days of a life style we will soon put behind us. The rarer information clusters like the Volt, the 5% coming our way that deal with the coming Age of Electrons, are what will matter more to our grandchildren, thank goodness. So let’s pay attention to them too. And let’s organize to get there. It will be a lot cleaner, cheaper…and more democratic.
Related Articles
|
Find People on SA
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largest
increase in followers
in the last 7 days-
1
David Fry
-
2
Philip Davis
-
3
Bill Gross
-
4
Tyler Durden
-
5
TraderMark
Fastest Climbers » -
1
-
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most activeSee all
Instabloggers.
Top Instabloggers » -
Top StockTalkers
TopSee all
StockTalkers.
Top StockTalkers »
This article has 35 comments:
I agree we are seeing the end of the bydrocarbon age. There are giong to ba a lot of people though that have been profiting from this that are going to try and resist the change that is coming.
There are manythat think we are going to be able to use Hydrogen as a substitute fuel in the near future. In the past there have been lots of rumors about this and teh auto industry has looked at the feasability previously but nothing has happened yet. I suspect one reason is that liquid hydrogen is highly exposlive and no one really relishes the idea of a hydrogen explosion following a car wreck. However, I have also been hearing rumors about some new technology to extract hydrogen from water with greater efficieny than in the past. If that's true then the fuel can be stored as water until needed, now that would be impressive.
Another good article. The amount of money that is going to go to oil exploration over the next ten years is going to be astronomical. Matt Simmons thinks it will be over a trillion dollars which the bulk of it going to maintaining the current infrastructure. How many solar panels could we produce with a trillion dollars? How many wind turbines, geothermal plants, ect with a trillion dollars? At what point do we start to view the entire energy complex different?
The chief obstacle to energy development is political. That will change when people discover there is a cost to being panicky and silly.
Another idea that is fascinating are the large scale horticultural skyscrapers. There is a prototype being designed for Dubai right now. It is roughly 30 stories tall (10,000sq foot on each floor). It is believed that one building will be able to provide 50,000 people with 2000 calories a day. The building would obviously be encased with solar panels and all the other "alternative" energy.
America could be the greatest show on earth if we act now. Eliminate highways, put in more railways. I honestly think life would be more interesting. I think it would actually make us a more mobile culture if we had our own euro train. Amtrak is not up to the task and is basically as expensive as air travel anyways due to the economy of scale. It is probably just the romantic in me espousing these grand ideas. Heck we could probably do an amazing overhaul before the oil stops dripping. Cars suck for the most part anyways. I have one purely for employment purposes as I need it to get to appointments. I almost feel embarrassed when sitting in traffic with countless other drivers pondering the point of it all while burping carbon into the air that you and I breathe. I think they call that shitting where one sleeps.
The Sad American lifestyle is killing our spirits prematurely. Yet we will probably have longer lifespans due to modern medicine.
You think your way is true,
what everyone should do?
Fine, but first on your own dime
and with your own sweet time.
And if your way proves right
then others will agree;
there is no need to fight.
But if your way proves wrong
should we have come along,
into the darkning night?
The stone age didn't end for a lack of stones. Neither will the hydrocarbon age.
BTW, those electrons are so nice and neat and clean powering those cars ... except for the fact that the electrons were generated by burning hydrocarbons somewhere else.
I do have my money where my mouth is, alternative, nuclear, oil and gas.
My recent history... 23-26: read a lot about being a vegetarian, so I did it. It worked for me. Read about yoga and meditation, then practiced it. It worked for me. 27-29: Felt lonely when surrounded by peers who engaged in drink and debauchery, so I decided to imbibe to my demise. Bankrupt at 29, massive anxiety attacks, and lifestyle turned upside down. 30: Doing great. Don't drink. Don't eat sugar and little meat. Practice martial arts. Take lots of long walks. Starting to enjoy the simple things again, realizing that matters never needed to get complicated. And yet I make really good money doing something enjoyable and autonomous, yet with it's fair share of stress.
I am not trying to push my views on others, but hey, what I did was simple and really helpful. Give up intoxicants, sugar (the no card diet is actually a good idea, just make sure you get a lot of vegetables and keep it light on the protein), and exercise consistently, especially something relating to yoga or martial arts. Qi gong is great if you have a good teacher.
Yeah, this was off subject, but hopefully it can be of use to some who reads it. And if you don't care for it, hopefully you can remain tolerant. Luckily these blogs have unlimited space, so a little tangent here and there is nothing to be bothered by.
All well and good. This writer supports 'alternative' energy in all its myriad forms. Economics at some level is a function of man's desire -- and the desire to have dispersed energy sources is good in my book. Motivated man, is productive man. There are plenty of motivated men, inventors, who for fortune or intrinsic good, want to develop technologies for this 'Electron Age'.
More power to 'em.
But Mr. Kingsdale's turning phrase: "...[H]ow the hydrocarbon age will end...", is premature.
Petroleum -- crude oil, Texas tea, or an addict's drug, whatever you want to call it, will remain a powerful energy source for more than "ten to twenty years," Mr. Kingsdale muses about.
This writer may have missed Mr. Kingsdale's declaration for Peak oil, but the "ten to twenty years" transition statement suggests that's where he is: Peak oil.
But, that's not where the oil geology is at.
The next five years will prove whether this writer is right or wrong. The Brazil oil finds, specifically, the Carioca field will tell much whether the 'Age of Oil" will shortly pass.
Why?
Because it has been trashed, and dismissed -- chiefly because should it 'pan out' to anywhere close to the initial giddy, ill-advised "champagne popping" statement of 33 billion barrels of crude oil -- a new age will dawn -- the ultra-deep, deep-drilling offshore petroleum age. This would not be a "cheap" age. It averages $70 a barrel to produce -- but it would be stable and plentiful age of oil availability.
Why is this 'new age' trashed and dismissed?
Because it violates the principle's of the "fossil" theory.
This oil -- if it exits -- is too deep to be explained by "fossil" theory.
That's why Mathew Simmons and his acolytes have dismissed it.
But others have not. No, they are spending $750 million a pop for the rigs to get it, and Petrobas has ordered 40 of these ships. Yes, $30 billion in investment. That's part of the money Mathew Simmons is talking about.
This oil, if it exists, and it doesn't turn out to be natural gas, violates the "oil window" that "fossil" theory geologists hold dear.
That's why Alan von Altendorf, an oil geologist, predicts Carioca will be mostly, if not all, natural "gas."
But should it turn out to be mostly oil, it shows there are huge amounts of petroleum to be found. Again, expensive, yes, but available, steady, and consistent.
von Altendorf knows that there is no other explanation for this oil, if it exits, for while only one well test has been made, if it's a real play, then it must be abiotic oil. The science is there, now the observations can be made in the next five years, and, somebody, "way above my pay scale," has bet $30 billion that this is so.
Should this Carioca field 'pan out' and a trend of fields be found running down the lovely coast of Brazil, a new bosum of oil will be available for the world markets.
More power to the 'Electron Age', but don't count out the 'Age of Oil' just yet.
The website, Oil Is Mastery, is focussed on ultra-deepwater, deep-drilling investment.
See for yourself -- the science is there -- that's why Petrobas is rising in value. And the "proof is in the pudding," we will find out, one way, or the other, in the next five years.
Don't you want to get in before the investment "herd?"
I have read alot about abiotic oil but will not digress. I want to make one point in defense of biotic formation for that sub-salt oil. What must have happened to deposit the salt? Yes, sea-water was getting concentrated in a closed basin where evaporation exceeded inflow. What might have been the condition of this closed sea just before the deposition of the salt? That's right, warm, stagnant water. Probably with so little circulation that it was anoxic at depth. So, any algae that grew at the surface; died, and got buried without decaying. Cover this stuff with salt, cook at 300F, and those hydrocarbons which may form, cannot easily escape because of the mile of salt forming above.
I don't know whether the oil is biotic or abiotic, but the geological context of the Brazilian discoveries makes biotic formation at least plausible.
For the next 20 years, we're oil and coal.
Regardless, the Volt is a hot car and I would absolutely buy one. and be long GM as a result.
It takes a while to implement all the energy saving plans and technologies people are just now committing to.
www.wtrg.com/oil_graph...
The other thing that makes me laugh is all the post yesterday on SA that talked about oil topping out in price and now in a decline-wow, look at today. Energy is off and running again and now we will see all the peak oil comments on SA-I mean, like who can our trust?
There are two responses. First, the "oil window" of "fossil" theory, dictates that below 15,000 feet deep, oil will not form, or will disassocate, or "crack" because of the heat. This deposit, whatever is down there, is deeper than 15,000 feet deep, and Petrobas' statement said the "oil" is 500 degrees Fahrenheit, way over the tempertaure "fossil" theory's "oil window" states oil will "crack" into gas.
This was the basis for Mr. von Altendorf's stating he thought it would be gas. This writer asked whether von Altendorf subscribed to the "oil window" theory. His answer was not to directly respond, but, rather, to state that abiotic oil was "impossible." This writer took that to mean the "oil window" was inseperable from "fossil" theory.
There is another reason as well. Salt deposits are not strictly from evaporation, they are also a result of "solfataric" action. This is a kind of volcanic process, similar to a sulpher vent. What was interesting about von Altendorf's description of the Carioca field (how he knew, this writer does not know) included dolomite deposits, this was a reason the field was "suspect" as von Altendorf saw dolomite as a sign of low permiabilty. This mineral is also common to these solfataric "vents."
Kezorm, you sound genuine in your interest; check out the Oil Is Mastery website, at the left-hand column there are direct links. Under Eugene Coste, click Canadian Mining Institute Jounal: The Volcanic Origin of Natural Gas and petroleum (1903). This paper explains the "solfataric," volcanic process and the minerals that are expelled. Salt is one. Spindletop, the 1901, Texas gusher, Coste describes as a solfataric mineral "fumarole." The salt dome, that everybody knows about is a result of this action. Coste gives a very good explanation of the salt's presence, and documents salt as a mineral expelled fro solfataric fumaroles. The salt - solfataric association is never rebutted (they do object to his theory of the inorganic source of the oil). But also present is dolomite, actually Coste describes the oil in proximity to the dolomite. So, there is salt and dolomite at Carioca, just like at Spindletop. Dolomite is also found in the Brakken basin in North Dakota, within the oil deposits.
Actually, there is a strong association between petroleum and salt in many, if not most oil deposits.
So, the salt at the Corioca field may not be of depositional origin, but rather 'solfataric' in origin along with the dolomite.
This is entirely consistent with abiotic oil theory.
What Peak oil folks regularly claim is that hydrocarbons are not associated with volcanic action -- this is categorically false. The scientific literature is full of associations between volcanic sites and hydrocarbons.
The science is at Oil Is Mastery. The Corioca field will do a lot to prove abiotic oil, one way, or the other.
jcrash - still in w/ my FSESX - started buying like a surgeon's wife when Bush was given first term (fun to profit at others foolishness) cost basis is laughable, hanging on for one more year for grins.
"It is obvious that the total amount of petroleum in the rocks underlying the surface ... is large beyond computation." -- Edward Orton, 1888
don't. We have a series of regional grids loosely linked to adjacent grids. There are different standards of connectivity, redundancies, back up systems, all different and largely uncoordinated. No national coordinated system. It set me into looking at systems theory, network theory etc. For example, when you devise a system or network, you decide at the outset what
is most important. Do you want robustness and redundancy or do you want efficiency, economy, speed etc. It appears that our networks have favored economy and efficiency and speed over stability and reliability. Leipigs Law of the minimum,
deals with zoological populations and states that whatever necessary resource is least abundant sets the limit for the population of any given species. This was formulated by a 19th century German scientist and it predates modern system and chaos theory but the principles are similar I think if extended to any complex system, not just zoological systems. If for example, your grid has aging or inadequate transformers, then that is where the failure point or the bottleneck will lie. I personally see no way out of this grid morass without a nationally coordinated restructure and rebuilding of the grid.That's right! Nationalizing the grid! Shutting down and nationalizing unregulated, partially regulated and regulated monopolies which are the crux of the problem. Shades of Hugo Chavez!! Simply adding input from nuke plants, windmills, solar panels and coal plants etc to provide the capacity necessary to supply all those Chevy Volts wont work without a total redesign. God knows where the money will come from to do it. I suspect the money just wont be there any more that it will be there for Medicare, SS , or rebuilding our transportation infrastructure unless we tax the living bejesus out of our corporations and our citizens. However if we don't try, you are witnessing the beginning of the end of our automotive suburban military empire. Let us pray for a leader with the brain power and judgment to grasp the enormity of the issue. WE have certainly wasted the last 8 years. If we or he can't start a national dialog on this pretty soon, we are toast. For a preview of the next decade I would suggest the readers to take a look at Mark Buchanan's book "Ubiquity, why catastrophes happen."
It is interesting how taking just 10% of the cars off the freeways can often eliminate serious traffic jams. At least high oil prices encourage conservation and efficiency in ways no public entity ever could. Europe has demonstrated that we can be seriously more efficient without sacrificing a high standard of living. Maybe we finally have the will to change our profligate ways.
So why is solar the most-favored option for long-term energy future? Coal-burning will accelerate climate destruction and pollution. Bio-fuels require a lot of energy "input" for very little gain. Wind-power is not feasible in most locations. Tidal power and hydroelectric limited to restricted locations. Nuclear is a potential option but the supply of nuclear fuel is limited (some estimates say exhausted in 30 years.) And we do not know how to build effective fusion reactors -- yet. New reactor designs may help, but humans are understandably a bit nervous about reactors, radiation, and maintenance after Chernobyl & Three Mile Island. If we built 500 new reactors, the odds are we'd see new accidents. NUclear fission can never be a perfectly safe technology.
The most workable answer for our future is solar (because it's free, unlimited, safe, clean) but the technology infrastructure to capture the sun's energy on mass scale is daunting. For a good review of what sort of mass program it would take to run America on solar, read Scientific American's article on a "Grand Plan" : www.sciam.com/article....
If you don't like the concept of a 100 mi x 100 mi solar farm in the SW US for any number of reasons, put 1 of them 1/10th the size in each of 10 states accross the US sunbelt. But start doing it; including the grid T&D and electrified rails to boot. Now let's hear how a 10 mi x 10 mi plot won't work in 10 states, and about tornados, NIMBY, etc.
You big oil, gas, and coal guys are afraid of becoming buggy whips and Model T's. Let's stop using 70% of our hydrocarbons to move people and goods - there are other ways available.
As for hydrocarbon feedstocks etc., move to biofuels, and catch up to 80% of our hydrocarbon demand.
Basically, leave the hydrocarbons where they are. Use the free solar and wind, and bio. Nucs are fine at 100 plants + replacement. Leave the dams as they are. Electrify the rails and interstates, cities and seaboards. That's a policy statement. Go fix it.
Thirty-three billion barrels of oil is only one year's supply at current consumption rates--and it will take plus or minus 30 years to produce.
The author is not implying that we will not be consuming oil 20-30 years from now--only that what is produced will be extremely expensive and there will not be a sufficient quanity to fulfill most transportation needs as in today's world.
Thirty-three billion barrels of oil is only one year's supply at current consumption rates--and it will take plus or minus 30 years to produce.
The author is not implying that we will not be consuming oil 20-30 years from now--only that what is produced will be extremely expensive and there will not be a sufficient quanity to fulfill most transportation needs as in today's world.
Check the Andasol Projects: Solar Power even at night !
tinyurl.com/6n74mq
tinyurl.com/4hyzpf
tinyurl.com/6m6vsr