We cannot drill our way out of this oil crisis. Since 2000, oil companies working in the U.S. have doubled the number of wells drilled per year.
Although increased drilling has added new oil to the nation's supply, it has not done so fast enough to offset the terminal decline of existing fields.
We are going to have to import more of our oil. Period.
Joined: Mar 22, 2005 Posts: 39 Location: Oklahoma USA
Posted: Tue Jun 17, 2008 8:00 pm Post subject: Energy Industry Positioning for Endgame
Yesterday I was in a corporate strategy briefing with some top and mid level technology staff of a major oil services company. About 100 in attendance. Ultimately the discussion turned to pursuit of some alternative/non-traditional forms of energy...and what that might entail, technically speaking. I won't speak about what was being discussed for fear of revealing inside info...but the intro to the presentation session floored me.
Within the first five minutes we were told:
1. Canterel is in decline.
2. Gawhar is in decline.
3. Light sweet crude is in decline.
This is not strange to hear at peakoil.com or even coming out of my own mouth. To hear it so plainly in this setting, though, was...well...surreal.
I got the strangest feeling, though, that most of the room was experiencing cognitive disonence. Luckily, I got the last question. Here is what I asked:
Will ________ (name of "opportunity" we'd been discussing) or anything else be able to offset the decline of light crude oil?
The answer...a very blunt NO.
The sentiment of the comment that followed was basically...these are the facts...and the thing we have been discussing is our next move.
Later that evening I went to the grocery store to pick up some strawberries. The shelf looked a little emptier than it usually does. I figured it was my imagination. An 80 year old (guess??) lady was standing next to me and struck up a conversation with the old man behind her.
"Someday soon I expect to see the shelves empty" she said.
"Sooner than you think" he replied.
It is the increase of stuff like this that has moved my personal preps into high gear. Starting to feel like were living in a powder keg waiting for someone to light the match.
Joined: Oct 04, 2004 Posts: 4657 Location: Oklahoma
Posted: Tue Jun 17, 2008 8:10 pm Post subject: Re: Energy Industry Positioning for Endgame
ExtractionEngineer wrote:
2. Gawhar is in decline.
Thanks for sharing this. It's not really a shock, but... well, it's a shock. _________________ The very existence of flamethrowers proves that some time, somewhere, someone said to themselves, "You know, I want to set those people over there on fire, but I'm just not close enough to get the job done." - George Carlin
Joined: Mar 28, 2005 Posts: 399 Location: Northern California, USA
Posted: Tue Jun 17, 2008 8:51 pm Post subject: Re: Energy Industry Positioning for Endgame
ExtractionEngineer wrote:
Will ________ (name of "opportunity" we'd been discussing) or anything else be able to offset the decline of light crude oil?
CTL? That's the only thing hard-headed oil men would consider talking about as a possibility these days. Tar Sands is in full exploit mode already. Alt Energy doesn't really use any of their oil infrastructure. Oil Shale is still doubtful in terms of scalability and EROEI. Anyone smart enough to know that Ghawar is in decline will probably also know how dubious ethanol is.
Posted: Tue Jun 17, 2008 8:58 pm Post subject: Re: Energy Industry Positioning for Endgame
Time to buy more ammo. _________________ “I'm completely in favor of the separation of Church and State. My idea is that these two institutions screw us up enough on their own, so both of them together is certain death.” George Carlin
Posted: Tue Jun 17, 2008 10:10 pm Post subject: Re: Energy Industry Positioning for Endgame
ExtractionEngineer wrote:
I got the strangest feeling, though, that most of the room was experiencing cognitive disonence.
Do you really think most people understand that oil running out = die-off? I really don't think people know how high the stakes are. _________________ Peak oil is sort of like a mental Everlasting Gobstopper, except it tastes like ass and you can't get it out of your mouth.
Joined: Apr 06, 2006 Posts: 2532 Location: 3 miles NW of Champoeg
Posted: Tue Jun 17, 2008 10:33 pm Post subject: Re: Energy Industry Positioning for Endgame
Quote:
Yesterday I was in a corporate strategy briefing with some top and mid level technology staff of a major oil services company.
Schlumberger? Baker-Hughes? Fluor?
How long do you think they'll keep a lid on this, EE? Your 1. and 3. points are old news, but Ghawar's status is the riddle wrapped inside a mystery wrapped inside an enigma. Some speak of Ghawar's collapse as a fait accompli, at their peril, if taunts from JD at peakoildebunked.com are what constitutes terror anyway.
Schlumberger's CEO stated that we're in an 8% decline. Might as well throw in Ghawar while you're at it!
BTW one our new members, a petroleum geologist calls himself ROCKMAN, says word on the street in Houston is Cantarell will decline around 50% this year. _________________ Cogito, ergo non satis bibivi
You got the wrong guy. I'm the Dude, man.
"We can find a needle in a haystack, but it is still a needle." - Colin Campbell on oil exploration.
Joined: Aug 14, 2007 Posts: 183 Location: Montreal Canada
Posted: Wed Jun 18, 2008 12:02 am Post subject: Re: Energy Industry Positioning for Endgame
EE, good to have people like you and many others on this forum. The canary in the peak-oil tunnel is starting to die... aviation industry, prepare for the crash landing..
Joined: Mar 22, 2005 Posts: 39 Location: Oklahoma USA
Posted: Wed Jun 18, 2008 6:33 am Post subject: Re: Energy Industry Positioning for Endgame
Dude,
I agree that point 1 is old news. I have also been wondering how anyone could "know" that Ghawar is in decline...to a greater degree of certainty than we "know" on this board. I agree that it is, but would be hard pressed to prove it beyond all reasonable doubt.
Also, as far as the name of the company...I'm not saying. Sorry if that makes me come off as a little paranoid, but part of my post-peak-oil strategy is to keep my job longer than most of the general population. Throwing my employers name around on internet message boards does not fit well with that strategy. Hope you can understand.
mos6507,
I don't know what conclusions others make. Honestly, I think most people intuitively understand it is very bad...and some of their brains just "change the subject" at that point. I know it took me a few YEARS to go from understanding of the problem to actively preparing my life for the ramifications. Maybe I'm slower than most at peakoil.com....but I definitely think there will be a time delay between the general public understanding peak oil and the gp changing their lives intentionally because of it.
Most likely scenario IMO....one day we will wake up and everyone will be panicking.
Joined: Mar 22, 2005 Posts: 39 Location: Oklahoma USA
Posted: Wed Jun 18, 2008 6:51 am Post subject: Re: Energy Industry Positioning for Endgame
Seahorse,
I have been reading your posts for years, and some of them were instrumental in pushing me over the edge to get into raising goats. No worries.
1. I don't think that the company does have better info than what we have here....although I could be wrong about that. The sources are probably the same. I was just pointing out that business cases are now being done with the presupposition of peak oil. This was the first direct evidence I had personally seen of that in my company. One could argue that the upper echelons of oil majors have known for decades. Otherwise, why not build more refineries. That is speculation, though, because if the upper echelons did know it they did NOT advertise that portion of their knowledge down the chain of command. My point was that, on the inside of the oil game, the cat is out of the bag.
2. Plain and simple. This business is cut throat. Now that the down slope is imminent, some of these non-traditional alternatives are becoming the ONLY growth markets left. Don't get me wrong, there is no "company" interest in peak oil beyond how it impacts the bottom line and what strategies will profit the company best in the end.
These companies grew up in a dog eat dog atmosphere, just for a while there was enough food to go around for everyone.
Joined: Oct 15, 2004 Posts: 2003 Location: Arkansas
Posted: Wed Jun 18, 2008 6:58 am Post subject: Re: Energy Industry Positioning for Endgame
EE,
This is pretty powerful information, bc, as you point out, it represents a turning point. Its interesting how after all these years the public, and now as you report, the energy industry, are recognizing PO. We've all wondered what would happen after society "wakes up." I guess we'll all know in about 12 months. I am glad to hear the energy industry is recognizing the issue. Maybe, just maybe, it they start putting some thought and resources into it, we can start finding some solutions. Too hopeful? I have to be hopeful. I have three kids.
Thanks for the post EE. This real world info marks a significant point in the PO timeline.
Joined: Apr 27, 2007 Posts: 4028 Location: The Great Sonoran Desert
Posted: Wed Jun 18, 2008 7:01 am Post subject: Re: Energy Industry Positioning for Endgame
ExtractionEngineer wrote:
Otherwise, why not build more refineries.
AZ Clean Fuels and Cantarell
Will not be built because of lack of supply. _________________ "There must be a bogeyman; there always is, and it cannot be something as esoteric as "resource depletion." You can't go to war with that." Emersonbiggins
"... hope is a rotten-thighed whore" Niko Kazantzakis
Joined: Sep 29, 2004 Posts: 2102 Location: Pennsylvania, USA
Posted: Wed Jun 18, 2008 9:21 am Post subject: Re: Energy Industry Positioning for Endgame
So much for the Saudi output boost. _________________ "That's the problem with mercy, kid... It just ain't professional" - Fast Eddie, The Color of Money
Posted: Wed Jun 18, 2008 10:16 am Post subject: Re: Energy Industry Positioning for Endgame
Kingcoal wrote:
So much for the Saudi output boost.
Yeah, so much for that. 500 kbpd of probably heavy Saudi crude, not quite what the doctor ordered - that nobody really wants and American refineries can't really process very well.
As for the "opportunity", like abelardlindsay said above, I could hazard a guess that it's one of these 3 : CTL, GTL, or CTG : coal-to-liquids, gas-to-liquids, or coal-to-gas. Desperate measures for desperate times. _________________ Live quotes - crude oil, gold and currencies
http://www.post1.net/lowem/page/livequotes
Posted: Wed Jun 18, 2008 10:33 am Post subject: Re: Energy Industry Positioning for Endgame
lowem wrote:
Yeah, so much for that. 500 kbpd of probably heavy Saudi crude, not quite what the doctor ordered - that nobody really wants and American refineries can't really process very well.
I thought the US was one of the few countries that DID have reasonably good refinery capacity for heavy crude. That was the whole reason why Venezuela is still selling oil to the US, because we're one of the only countries that can refine their heavy oil. _________________ Peak oil is sort of like a mental Everlasting Gobstopper, except it tastes like ass and you can't get it out of your mouth.
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