William Davison

Peak Oil Demand

NG will not cause oil prices to fall, because most oil is used for transport and the investment required to replace this infrastructure will take decades to replace and cost Trillions. Gas to liquids projects like Shell's Pearl gas-to-liquids plant in Qatar cost between $18bn and $19bn and how much will it produce? Just 250,000 GTL and BOE a day, less than half the production decline of Cantarell in 2008. Like it or not Oil at $80 is still fairly cheap.

Energy Impoverishment: Heading Back to Coal?

25 years is a remarkably short time to complete energy transition, it took almost a 100 years last time, so I assume your only talking about partial transition, as I suspect we will still be using Oil for Air transport and many of our trucks in 30 years time if not longer. Then there are fertilisers and plastics to consider. We cannot replace all our oil infrastructure in 25 years, the Alaska oil pipe line over 30 years old now, you cannot simply write off decades of investment within 25 years.

High Gold Prices: It's the Oil, Stupid

Here is your answer

blogs.news.com.au/cour.../


On Nov 25 12:32 PM Speakeasy wrote:

> More inconvenient truth!
> Heraldsun.com.au :
> 8.15 PM UPDATE: The Hadley University of East Anglia CRU director
> admits the emails seem to be genuine:
> The director of Britain’s leading Climate Research Unit, Phil Jones,
> has told Investigate magazine’s TGIF Edition tonight ..."It was a
> hacker. We were aware of this about three or four days ago that someone
> had hacked into our system and taken and copied loads of data files
> and emails."…
> TGIF asked Jones about the controversial email discussing “hiding
> the decline”, and Jones explained what he was trying to say….
> So the 1079 emails and 72 documents seem indeed evidence of a scandal
> involving most of the most prominent scientists pushing the man-made
> warming theory - a scandal that is one of the greatest in modern
> science. I’ve been adding some of the most astonishing in updates
> below - emails suggesting conspiracy, collusion in exaggerating warming
> data, possibly illegal destruction of embarrassing information, organised
> resistance to disclosure, manipulation of data, private admissions
> of flaws in their public claims and much more. If it is as it now
> seems, never again will “peer review” be used to shout down sceptics.
>
> This is clearly not the work of some hacker, but of an insider who’s
> now blown the whistle...

High Gold Prices: It's the Oil, Stupid

A question I would like to ask for those of you with refining chemistry knowledge. If we were to decide the Oil way to valuable and should be reserved for plastics and as transport fuel in some areas, could we produce more plastics and diesel and less heating oil, gasoline etc.


On Nov 25 03:05 PM Steve Hughes wrote:

> Genesis blurted: "...."Three barrels of crude will produce two barrels
> of unleaded gasoline, and one barrel of heating oil."
>
> That depends greatly upon WHAT crude you are talking about. WTI
> or Brent may have the properties which breakdown as you suggest.
> However, other crude oils of the world have different properties
> which might yield more heavy products like asphalt and tar (Eastern
> Venezuela), or high sulphur crudes which may yield Sulphuric Acid
> and yet others might yield other hydrocarbon products like plastics,
> waxes, greases, lubricating oils, kerosene.

Time to Bail on Shale?

If the shale gas depletion is as fast as some claim then they will start to run out of cash to drill further. Without higher NG prices it could be difficult to sustain after 2011.

High Gold Prices: It's the Oil, Stupid

"williamdav: but if there is a true currency crisis, will the paper assets you mention make it through to the other side?"

Well my answer to that is the rule of law, even in Germany's Weimar republic, as far as I know the stocks survived and big industrial companies remained. The USA and UK have shaped the world for the last 250 years or so and its guiding principle has been the rule of Law and respect for property rights. Remember despite George Washington leading a rebellion against the Crown, Barrings of London continued to act as his bankers. Where do keep you keep your gold, under your bed, I suspect you have a bit paper and if my assets are paper assets then so are yours. Remember Silver holdings were banned in US in 1930's.

Moderate inflation is a great way to wipe out your debts as their held in your own currency, as the Fed and the Bank of England knows. You only need 7% inflation a year to halve the value of your debts in 10 years as the Chinese are about to find out. The trick here I think is not to hold Fiat currencies in cash or Bonds once the inflation starts. I use to have gold and silver like you, but there are other assets that can hold their value. And Gold pays no dividend or interest, so your counting on speculative gains. Nothing has a fixed value, be it Fiat currencies, gold, land or companies, they all change in relation to each other.

High Gold Prices: It's the Oil, Stupid

Re "what are you doing to protect your net worth?"

Oil & Gas 40% -includes BG, BP and Statoil. Bit light as George Soros is on 49%
Emerging markets 24% includes Latin America, India
Electric/Smartgrid/Wind related, 12% - includes ABB, National Grid
Corp Bonds/Infrastructure 8% - for dividend
Transport - Inter-modal/Rail 5%
Other 11% - mostly Tech.
Cows Chickens etc 0%
Gold 0%

Plus another 20% in UK Fiat currency - £. Yes I know that's dumb, but its what I am paid in. Well you did ask! What's yours?


>
> WilliamDave: well, interesting notes. so i am interested - what are
> you doing to protect your net worth in these times? i have a garden
> and wish i could have some chickens, goats, and cows but unfortunately
> i live in a neighborhood that doesn't allow such. i'd also like a
> big pond stocked with fish. those will be the things of value when
> the US eventually goes through a huge currency change. and that is
> coming as long as we stay addicted to foreign oil (just like in brazil).

High Gold Prices: It's the Oil, Stupid

So you buy Gold which pushes up the price and then the miners mine more Gold out the ground using lots of energy and then you take that gold and put it in vaults back underground again. That's a Zero sum game as far as humanity is concerned.

Buffett 1998 "Anyone watching from Mars would be scratching their head."

It just makes Peak Oil problems worse, we waste capital and energy instead of using it to develop new energy sources and we have been warned before on this.

"So Midas, king of Lydia, swelled at first with pride when he found he could transform everything he touched to gold; but when he beheld his food grow rigid and his drink harden into golden ice then he understood that this gift was a bane and in his loathing for gold, cursed his prayer" (Claudian, In Rufinem)."

Bright Future for Petrobras and Brazil, Part 2

OK Alan, I read your articles on SEC/oil reserves (V good) and PBR's off balance sheet liabilities, but what about BG group and their 30% stake in the new finds. Is that a better way to play it or do your doubts about the new finds effect them significantly as well.

On Nov 22 12:48 PM Alan von Altendorf wrote:

> We reiterate and affirm our sell rating on PBR.

The Global Oil Scam: 50 Times Bigger than Madoff

"There is NO shortage of oil. OPEC alone has 6-7 Million barrels a day of spare capacity"

OK then just invade the middle east and take their oil then. Sorry you tried that already, why do good men have to die for Neo cons and their addiction to cheap oil. I supported the Iraq war but I will not support any future attempt by US neo cons to take other peoples oil, your on your own mate. The Saudis can sell THEIR OIL at what ever price they choose and good luck to them, they have the good sense to conserve their oil, while you wasted yours.

International Energy Association: Forced to Eat Their Optimistic Data on Future Oil Supply?

If current field depletion is 6% a year as the IEA has forecast and current conventional crude production is about 72mbd, then your 18.3mbd new supply is wiped out in 5 years and your 25mbd in 7 years.

On Nov 11 01:37 PM OilFinder wrote:

> The IEA is not being pessimistic on future oil supply.

> Subtotal is now 18.3 million barrels/day in new supply by 2020.<br/>
>
> I could go on with more examples. Reaching 20 million barrels/day
> by 2020 would be easy. I might even get to 25 million barrels/day,
> especially if we make some reasonable assumptions about new discoveries off the coast of Brazil and Angola.*.

For Your Perusal: The Glory of Free Market Oil Supply

Well I think your wrong it covers 6 years and we should of seen some demand response in that time. Yes it can take 10 years to bring on new fields, but your ignoring the fact that higher prices extend the fields life and increase the oil recovered. Many North Sea oil fields have had their projected life extended considerably in the last few years but its not stopped the decline. The message from the North Sea is clear. Its got the best data, the most advance technology, its capital intensive, has good local infrastructure, is political stable and even the Tax regime is fairly good.

Your clutching at straws. See the chart www.theoildrum.com/upl...

On Nov 02 04:15 AM Dave5577 wrote:

> Another indication of peak oil perhaps. Show a chart of their acquisition
> expense and exploration and development expenses over the same time
> period. And do not forget the long lead times to bring new oil to
> market...at times it can be 10 years or more with permits and the
> like.... Basically a chart that does not indicate what the author
> says it indicates.

George Soros: The Guru Outlook

Because he does not have sex with his relatives.

On Oct 29 09:29 AM p church wrote:

> If Soros is so smart, why is he a liberal?

3 Stocks that Will Ride the Wind Energy Boom

Your right about Iron ore as the Oil and Gas industry will also need large quantities to open up the remaining reserves in offshore in deep water off Brazil, GOM and eventually Greenland and the Arctic.

What I think you have missed is that most of the Wind is remote places as well and will need vast expansion of the electricity grid, particular for the more reliable off shore wind that is now developing in the North Sea. That will require Super smart grids, linked using HDVC, so industry leaders like ABB, Siemens and meter companies like Itron

World Series of Crude Oil: Winner Decides Winter Gasoline Prices

"The economy and realization that demand of fuel had been going down was due to the price of gasoline spiking up to $4.50 and diesel at $5 per gallon. It exceeded what customers were willing to pay."

Well you will get use to $5, $6 and even $7, we have in Europe a long time ago. As there are no really good alternatives.