nerfer

Oil Supermajors' Resources Might Be Drying Up

Good read, thanks for the info. Is the Bakken field in North Dakota/Montana considered an EOR? It's a pretty rich field from what I hear, but requires horizontal drilling in a narrow layer fairly deep down.

Algae Biofuels Have a Promising Future

Do you have any supporting evidence for the $2.2 billion figure? EVnow's interesting and informative link states "The US Department of Energy (DOE) from 1978 to 1996 devoted $25 million to algal fuels research at NREL". Even if the total number is in the single billions, that is less than government-subsidized research into coal gasification or hydrogen research.
Algae takes power from the sun, but doesn't have the daily variations that wind or solar has (personally, I prefer geothermal for electric production). Since it can be grown intensively, using waste water, it can theoretically provide much more energy per acre than other, larger crops. (Much better than corn ethanol, even better than sugarcane ethanol, which is a feasible crop). I really don't see what all the fuss about "real-time" energy creation is for. All bio-mass is real-time (renewable). With the end of cheap oil upon us, we need to put real money into things that have real promise, if we want any kind of decent economy in the future. Obviously algae is not the only solution, but there won't be a single solution to replace oil, it's been so versatile and critical we will need every tool we can use going forward.

On Nov 13 12:09 PM User 471168 wrote:

> We have spent over $2.2 billion dollars on algae research for the
> last 35 years and nothing to show for it. Algae has been researched
> to death at universities for the last 50 years in the US. The problem
> is as long as the algae researchers can say we are 3-5 years away,
> its too expensive and they need more research they get the grant
> money. Nothing will ever get commercialized at the university level.
>
>
> The question you need to be asking is " Does the US really want to
> get off of foreign oil or do we want to continue to fund the algae
> researchers at the universities."
>

Don't Believe Long-Term Oil Forecasts

You're referring to Jevons Paradox. There's two points I'd like to make on that:
1) This holds well if there is an indefinite supply limited primarily by cost of production. If oil is in decline, the cost of production will be going up, and overall consumption may not rise after all.
2) Regardless of overall consumption, if each unit produced is used more effectively, more work will get done with the same amount of units consumed. More people get to work, more things get made, more relatives are visited, etc. Increasing efficiency is still a good thing and a worthwhile goal, even if overall usage doesn't go down.

On Nov 10 12:59 PM Blair wrote:
> The basic issue regarding oil is that it is a high density energy
> material. No doubt we can reduce consumption per unit, however, there
> will be more units to consume the energy. Consequently, the issue
> is simple - overall consumption will increase, with all of intended
> (and unintended) consequences.

Don't Believe Long-Term Oil Forecasts

Thanks, I agree 100% with your comments. The poster you replied to apparently hasn't looked at oil production & discovery charts. 150 years ago oil was barely relevant, in the 70's U.S. production of oil was indeed peaking, now it's the world's turn for peak oil. There's still oil out there, but pumping it at the rates we want won't be cheap. Since U.S. dollars are backed in oil (no longer gold), any increase in the price of oil makes everything else more expensive for Americans.

"Geology rules, and Mother Nature bats last." That should be a bumper sticker.

Also, I was looking for the article on inflated numbers from the EIA, I heard a comment on the radio, but hadn't seen anything else about this today.

On Nov 10 04:00 PM User 391256 wrote:
> Well, 70% of the petroleum geologists at the Petroleum Geology Conference
> in London believe that peak oil is a concern. (www.theoildrum.com/nod...).
:
> We are heading onto the downslope of oil production just as we headed
:
> there are no scalable alternatives in the way of portable
> transportation fuels available... not talking about hypotheticals
> here or wishful thinking about human ingenuity. The world uses around
> 80 million barrels (=3,360,000,000 gallons) A DAY mostly for transportation.
> The current state of alternatives is a drop in the bucket. The most
> recent figure for global decline in production is between 6% and
> 7% per year with discoveries having peaked about 40 years ago. Price
> will likely go up and down as tight supplies drive it up and then
> recession drives it down in a long stairstep descent into a lower
> energy economy. Geology rules, and Mother Nature bats last.
>

> [Edit] After writing this comment I discovered a reference to this
> article: www.guardian.co.uk/env...
> casting doubt on the IEA reporting even though their forecasts are
> getting more reality based than they have been in the past.

How High Will the Price of Oil Go?

Thanks for the feedback.
Range doesn't concern me so much. Most people commute less than 40 miles a day, and electric vehicles easily go double that distance. Recharge conveniently at home for pennies per mile (but upfront costs are more significant, as you mention). Have a hybrid or rent a car for your long trips & save money overall.
Tata is also experimenting with making an electric version of their small car, or a car powered by compressed air (probably noisy to refill). But the Nano is just too small and too slow for common American tastes, a used small car would be more attractive.
Fuel-cell vehicles (hydrogen) are a complete boondoggle, at this time, IMO.

Some of the established manufacturer's EV plans:
www.bloomberg.com/apps...
In China, Chery is an automaker to watch (may actually partner with Chevy), they have a proposed $15K electric car. Some more about China's auto plans:
evworld.com/news.cfm?n...

Living4Dividends wrote:
"I am not impressed by the US's lineup of EV. All are expensive like the Volt. I don't know about China's EV offering. Still 20,000 seems like a lot of money for a vehicle that only goes a short distance. The Tata Nano is $2500 for the fully loaded Indian version. Let's say the world model, with airbags & western safety features costs $5000. That is an inefficient car with superb gas mileage. "

How High Will the Price of Oil Go?

The $40K Chevy Volt is not the single face of our EV future. Many other companies (many small new ones, some new faces from China and elsewhere) are coming up with new innovative ideas for half the price of a Volt. The tricky part is getting past the safety crash test hurdles (several million dollars that a startup doesn't have), so more than a few are designed with 3 wheels to be classified as motorcycles. In 2011-2012 there will be a real change in options to the consumer, and the big car companies may never be the same, if they survive that long.

How High Will the Price of Oil Go?

I'm not so optimistic about oil substitutes. They'll take years to come online, and any disruption (like a 6-month slump in oil prices) will likely derail investments & cause the process to start over again. Ethanol was going to be the savior, but people became fixated on corn, which is the worst source of ethanol. Our green options are natural gas (a la Picken's plan), cellulosic ethanol, & electric vehicles (which can be charged overnight on the existing power grid for the first few million vehicles, after that we need to do something).
Coal unfortunately will be part of our future because it is there and it's cheap (as long as mountaintop removal and stream dumping is legal), but it's the worst option environmentally.
Geothermal (for electric grid, EVs) is an overlooked opportunity - green power, available 24/7 (for certain parts of the country). California could have all the EVs they want if they expand geothermal. That frees up natural gas for long-haul transportation.

But oil itself has a limited lifespan as a transportation fuel. I think we've already seen the peak in production. OPEC couldn't increase production in the first half of 2008 because they were at max production. With $60/barrel in a recession, when the economy starts coming back the price of oil will increase even faster. $100/barrel will be the low end in 2010, and it only goes up from there, only tempered by its braking effect on the economic recovery.

Geopolitical Energy: Centered on the Caspian Sea (Part 2 of 2)

Fitzman, I haven't read the book, altho it definitely sounds interesting, so I don't know the timeline of talks with the Taliban. I'm sure funding for Afghanistan dropped significantly after the Russia pull-out however, and we couldn't ignore the terrorist aspect after 9/11. For the years in between I need more information.

WRT Iranian nukes, it's probably a combination of motivations. Close neighbors (including Israel and Shiite-run countries) are definitely part of it, but upsetting the U.S. would be a good side-affect for them.

Mythbuster - We will still use fossil fuels in the future, but the idea that the U.S. can support its current rate of use by North American supplies (let alone just U.S. supplies) is a dangerous fallacy. Efficiency and conservation are the first two steps we should take for immediate improvement, then renewables, including geothermal and improving the grid to handle varying loads of wind power. Recharge electric cars overnight. Battery R&D. These are things to improve the American economy, not thinking that drilling is our only solution.

Geopolitical Energy: Centered on the Caspian Sea (Part 2 of 2)

Good article, good food for thought. But I disagree on the Talibans - I think they were considered our friends while they were fighting Russia (there is the line of thought that the bankruptcy of U.S.S.R. from low oil prices during the Reagan years and their military defeat in Afghanistan is what allowed Poland and the Communist Bloc countries to break free of Russia). Once we no longer needed the Taliban to fight Russia, we lost interest (see Charlie Wilson's war), in the subsequent vacuum they joined up with Al Qaeda and bin Laden. They always treated their women and history badly, but only after 9/11 did we agree they were really terrorists and actually enemies.

Americans Forget High Oil Prices Too Quickly

Totally agree with a columnist, which is kind of unusual, but I have a couple comments:
1) the good years under Clinton were probably due in large part to the exceptionally cheap oil of that time. I expected a recession to come from high oil prices, but was surprised by the extent of the housing/finance collapse. (This might buy us time with oil supply). Even with today's cheap-ish oil I doubt we'll ever get back to times like the Clinton years in the next couple decades as oil prices cannot sustainably drop any lower than what they are. There was speculation on the top side in summer, now there's speculation on the low side.

2) I am continually surprised by conservatives who think the status quo is patriotic and we need to buy big American vehicles. Putting our economy totally under the will and abilities of unstable and unfriendly countries is so dangerous it should be considered un-American, even treasonous, to use an SUV for commuting to an office job.

Reasons to Love 3-Digit Oil

sharksm, I agree with your basic points (We shouldn't mandate XOM, BP, etc. to do or not do certain things, though they may do it on their own, and we should invest in alt. energy R&D and production).
But we can't drill our way out of this problem. We simply don't have enough oil in our control (ANWR, off-shore, etc) to raise production enough to lower prices. I'm sure eventually we'll drill there anyway., but let's save it for the real crisis yet to come.
And your original post suggested electric cars are expensive & unrealistic, which I disagree with. We are going to see an explosion of new cars (finally!) in the next 4 years - hybrids, PHEVs, BEVs, due to market forces. CARB, PNGV and other government mandates tried to lead companies here proactively, but it took market reaction to get real movement. Unfortunately American companies were slower to react than others.

Reasons to Love 3-Digit Oil

Stockpikr has a point. Fuel cells in particular are not a magic bullet. But electric cars are more efficient than ICE, they haven't been used because of entrenched beliefs and perception about battery needs. We need to make rational changes when faced with a coming crisis (it isn't here yet, folks!). Electric cars are part of the solution, but not the only part. Unfortunately, Brahm might be more correct than we want to think.
PaulK, even if abiotic oil is true (definitely not a mainstream idea), it would be so hard to find and so far to drill to these ultra-deep sources that oil prices wouldn't be any lower than they are today. Read the above story about Brazil's ultra-deep wells.

Reasons to Love 3-Digit Oil

Sharksm, the energy companies (XOM, CVN, etc) are in the energy business. Their oil supplies are drying up or being taken over by nationalized corporations. They need to come up with new energy sources to stay in business, BP is not promoting itself as 'Beyond Petroleum' for nothing. Get informed.
Electric cars do not need to cost $45K, with mass production they will be equivalent to cars on the market, with a lot less maintenance and repair needed. They can be powered by unused electric capacity at night, with a very minimal increase in CO2 - saving CO2 by reducing (by attrition) the number of inefficient gas guzzlers on the road. An existing ICE vehicle is <30% efficient (converting fuel to motion), electric vehicles are about 90% efficient.
Last point - our own oil supplies will be fully tapped, I'm sure, but why not wait until we need the oil to keep our farms running, no reason to use our own oil now just to keep John Doe driving to the grocery store in his Chevy Tahoe. We don't have enough to keep ourselves powered for long at all, or we would already have done this in the oil embargo of '79.

Oil Manipulations Exposed

Brian Pursley - The first article trusts the middle east numbers for their oil reserves, even though there is good evidence those are politically manipulated (their country quotas are based on that) and there is no verification of any of those numbers. The last two articles don't argue for abiotic production, but do say there are large, biological sources of oil deeper down. If that is the case, they are feeding the higher sources sporadically or only in certain locations, since most sources of oil have not shown any signs of recovery, in fact many have post-peak production declines sharper than expected (North Sea, Mexico). Certainly not a 'renewable, infinite' resource as you say, and I'm hanging onto my '06 Prius for many more years.

T Stephens - good post, even with the typos. If the hedge funds/futures market were suddenly the cause for the run-up in prices like the author is saying, why not the other commodity markets, and why not ten years ago also? I'm not going to say there is no manipulation or deceit at all in the market place, but that's not the cause of our current high prices. We're hitting peak oil production, and the sooner we accept that, the sooner we can create real solutions.

Oil Manipulations Exposed

Brian - Not sure about your post. Oil is not infinite, even if you buy into the fringe abiotic hypothesis (mostly championed by Russia, which is now in production decline). We didn't take Iraq's oil in 1990, Bush Sr. knew there was no exit strategy if we took out their government, we just kicked them out of Kuwait (which would substantially increase their oil reserves and shipping access for oil, so yes, it was about oil, intelalum).
Timsinoil - price of crude has risen more often than not lately, why single out 2000's election? You could look at the terror alerts in the 2004 election for easier political manipulations.
Mikey - if this is a bubble (and it could easily be froth on top of a fundamental increase) it will hurt us at the pump, then at the grocery store, then in the unemployment line, and that's bad for everybody. That's why this is important, even if you personally can make short-term profits in trading.

We can't drill our way out of this. It can help marginally, but it's not a major piece of the solution. It's things we can do - driving the speed limit, with tires at proper pressure, will reduce our gasoline consumption 10%. Efficient , reasonably sized vehicles will save another 25%-50%. Electric vehicles and living close to work will be a part of our future.