Boone Pickens seems to think 85MM Bbls/day is about it....

cudabachi

...at least that's what I gathered watching him on CNBC. It certainly didn't seem that he believed there would be any significant increase in worldwide production in the foreseeable future.

He said something to the effect: "World production is sitting at about 85MM Bbls/day, doesn't seem to be able to exceed that total, and yet demand continues to increase around the world, including the U.S. The only thing that is going to cool off demand at this point, is price.

With a reported income last year, via investments, that exceeded $1B, he probably knows something about the subject.

Shadizar · Heavy Crude Joined: Jul 24, 2005 Posts: 181

Yes, I saw that too. Basically he described Peak Oil without actually saying those words. He didn't touch on decline though.

What I liked the most was how he pointed out that prices would have to go high enough to deal with any demand above 85m barrels per day.

I think it was a very good interview.

-Shadizar

cudabachi

I thought it was an excellent interview too, I just wish the interviewer would have quizzed him about the ability of world producers to keep pumping at these levels. It would have been interesting to hear his thoughts.

He did say that it was his opinion that crude oil, gasoline, and heating oil were all headed higher......even said that he believed that we'd see $75/bbl oil before $60/bbl oil but that natural gas would go lower.

bobcousins

Old Boony has been saying the current production is about the limit every year for the past 10 years, eventually he will be right.
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DantesPeak

seahorse2 · Expert Joined: Oct 18, 2004 Posts: 1966

Bobcousins,

I've been following peak oil since 2004. During that time period, Pickens has consistently said world oil would peak at about 84 mbpd. When pressed last year how he arrived at this figure, he said there's a reason why world oil refinery capacity is 84 mbpd, implying the oil companies know this is maximum world production. In fact, Pickens seems to be correct in the world refinery capacity problem. I started a thread on the peak oil discussion forum on refinery issues, and there is a report on world oil refinery capacity put out by ICF that discusses at length the world refinery bottleneck. Suffice it to say, there is no information to the contrary that we are closely approaching world oil refinery capacity. Now, whether this means no significant refinery capacity is coming on line bc the major investors are peak oil advocates is open to debate. Pickes says its due to peak oil.

JohnDenver · Light Sweet Crude Joined: Aug 29, 2004 Posts: 1888

UIUCstudent01 · Intermediate Crude Joined: Mar 10, 2005 Posts: 894

There was a graph on the oildrum that showed that oil production seems to be at a plataeu for a little bit now... even with the rise in prices...
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seahorse · Expert Joined: Oct 15, 2004 Posts: 2256 Location: Arkansas

Hi JD

As you can tell from my post, I was relying on memory as to what Pickens said. I said "about 84 mbpd." If he actually said 82, that seems close enough to 84 to me. Even if oil peaks at 90, its so close that many optimist like yourself would be shocked. So, anything under 90 is fairly pessimistic. We shall see. The fact that oil is on a plateau despite high oil prices, and has been for about a year now, and the fact we are operating close to world refinery capacity, lends credibility to Pickes statement. If you disagree, shed some light on this for us please.

If I were to have to choose between the "Pickens" and the "lynches", I would have to go with the Pickens right now. In 2004, I wasn't sure who to believe, but during that time, Pickens has been correct in his predictions and Lynch incorrect - at least predicting the price per barrel of oil. For example, in July 04, Lynch said oil would be at $35 per barrel by summer 05. Very wrong. Pickens said $50, very right. Last year Lynch said, that by 06 oil would drop under $40, not happening yet. So, if we choose a camp by the accuracy of predictions, the Pickens have the most points right now.

It would be false to imply that Pickens is a peak oil "doomer" end of the world kind of guy. If you follow Pickens closely, however, you will also note that he is not a doomsday pessimist, in fact, he believes that changes like hybrids will solve the problems caused by high energy.

My personal opinion is we will not see peak oil anytime soon, because a political/economic crisis will kill demand for oil before peak oil hits. It seems that peak oil will hit between 2012-1015 (SA analysis, PFC analysis, Task Force Unity analysis), but that all assumes demand growth for oil. If the US attacked Iran, the US has a financial crisis, bird flu etc. or a combination of all three happens, a depression would seem to kill demand for oil and all the current projections would be off. I think the above political economic problems are much more imminent before peak oil, however, lack of production capacity leading to current high fuel prices is exacerbating the imminent political/economic problems, making them far more likely.

Now, where do you stand?

JohnDenver · Light Sweet Crude Joined: Aug 29, 2004 Posts: 1888

DantesPeak

It does seem like there has been some small variation in what Pickens has said over the last two years. I am not sure if that is because he was talking about conventional prodcution or all production including non-conventional.

He did mention the 85 mil figure since last summer, and has not increased the figure since then.

Free

JohnDenver · Light Sweet Crude Joined: Aug 29, 2004 Posts: 1888

seahorse2 · Expert Joined: Oct 18, 2004 Posts: 1966

JD,

All successul businesses use and depend on accurately forecasting trends, using predictions and models - Very common with any big company forecasting sales and trends. Why, for example, would any company invest the capital in a deep water well in the Gulf of Mexico if the amount of oil, production, and peak weren't estimated? They wouldn't. Predictions are a necessary part of business and done daily. Decisions can't be made without them.

Predictions are also a necessary part of gov't opertions - without projections, predictions, we would be unable to forecast medicare, social security, or any other gov't program, the US wouldn't know how many bonds or what kind of bonds to sell on any given day to finance its debt.

Is peak oil forecasting necessary? I think so. If the 70s oil crisis taught the world anything, its how important oil is to the world economy. Jimmy Carter seemed to think oil was an issue, declared ME oil a national security interest of the U.S., and further made some attempt to get the US off of oil. Further, George Bush said the United States must end its addiction to oil, so, why is oil so important if there is so much of it and it will never run out? If oil were plentiful and not in danger of running out, the United States wouldn't be so worried about getting over its addiction. Therefore, forecasting as accurately as possible a world oil production peak seems a necessary first step in getting the U.S. off of its oil production peak. Its necessary to know when the get serious time is and decine when the gov't must lead the way rather than waiting for private industry to lead the way.

Further, the Hirsch report shows the importance of predicting a world oil production peak. That report concludes that peak oil could cause serious economic repercussions if not mitigated (until there is a good analysis showing how the Hirsch report is wrong, I will subscribe to it). That report opines that it would take 20 years of mitigation efforts to transition America off of oil to mitigate serious economic effects. Since this report was done at the request of the DOE, since the president says the oil addiction must end, I would hope that the DOE also agrees that forecasting a peak oil date is as important as forecasting the bankruptcy of Social Security, medicare, or any other number of gov't programs.

Since many people believe that world oil peak will occur between 2012-2015 (including Saudi Arabia), the gov't ought to at least, in light of the Hirsch report, make its own determination as to when world oil production will peak. Maybe it has, since we are fighting in Iraq, Afghanistan, etc., and not bc of weapons of mass destruction.

shortonoil · Fission Joined: Dec 02, 2004 Posts: 2752 Location: VA USA

.

With 55 of the world’s 65 largest oil fields presently in decline where do you suppose that the oil production necessary to exceed of 85 mb/d is going to come from? Pickens is probably right.

.