Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
1. Total world consumption in 2003 was 78.112 Mb/d. Total world production was 76.777 Mb/d. I imagine that much of the discrepancy has to do with the filling of strategic reserves throughout the world.
2. Saudi Arabia produced at an average of 9.817 Mb/d in 2003. This is in excess of the maximum sustainable production rated by the IEA of 9.5 Mb/d. Are the Saudis being pressured into pushing their production too hard? Princeton's Kenneth Deffeyes certainly thinks so:
Princeton Professor Ken Deffeyes wrote:
Over the next few months, it will be particularly interesting to observe the oil exports from Saudi Arabia. Varying opinions are floating around about the unused Saudi Aramco production capacity: from two million barrels per day down to zero. In my opinion, the Saudis are in a tight squeeze. On the one hand, they don't want high oil prices to trigger enormous initiatives on conservation and alternative energy sources. The Saudis don't want to kill the goose that laid their golden egg.
On the other hand, the supergiant Ghawar field, which produces roughly half of the Saudi oil, has a problem. Within the limestone (calcium carbonate) reservoir rock, there are streaks that were altered to dolomite (calcium-magnesium carbonate) before the reservoir filled with oil. As is often the case, oil and water can flow more readily through the dolomite streaks than through the limestone. There is an active waterflood program at Ghawar; seawater is being injected at the lower edge of the oil reservoir to push oil in to recovery wells at the crest of the dome. Increasing the oil production rate at Ghawar will generate an unwanted byproduct: pulling water through the dolomite streaks to the oil production wells. Gahwar is already producing one barrel of water along with every three or four barrels of oil.
In one sense, both estimates of "unused" Saudi capacity could be correct. Saudi Aramco could turn some valves and increase production rate by two million barrels per day. In doing so, they might cut short the life of their largest resource.
It occurred to me a couple of months ago that I might be the only geologist outside of Saudi Aramco to sit down with a microscope for a leisurely examination of the Ghawar reservoir rocks. During the 1970s, we had a visiting faculty member from a university in Saudi Arabia. After some haggling, Aramco loaned us a box of samples. Those dolomite streaks are real.
3. Among other OPEC producers, Venezuela is also exceeding what the IEA considers to be it maximum sustainable production. Nigeria is somewhat underperfroming.
4. The UK half of the North Sea fields has been in steady decline for four years. The Norwegian half shows a clear trend of decline now as well.
5. China's consumption increased by 11% in 2003.
6. Another interesting trend that I have not seen discussed elsewhere involves the FSU countries. During the halcyon days of the USSR, oil consumption in the Eastern bloc was much higher than it has been over the past decade. In 1989, Soviet oil consumption was over 8 Mb/d. This dropped precipitously in the FSU to 5.5 Mb/d in 1993, and steadily eroded to 3.449 Mb/d in 2001. Since then, there has been a clear uptrend. If the FSU rises to again consume as much as it did in the Soviet days the global supply situation will be just that much more overstressed.
7. When viewing these statistics, it becomes quite clear how important it is to get Iraq's production back online. It has been estimated that with the appropriate investments Iraq might one day produce as much as 11 Mb/d. The world will need every bit of this to make up for declining production elsewhere and increased demand. _________________ www.searchingforthetruth.com
The truth that is suppressed by friends is the readiest weapon of the enemy.
- Robert Louis Stevenson
Joined: May 22, 2004 Posts: 1434 Location: Ottawa, Ontario
Posted: Tue Jun 15, 2004 11:30 am Post subject:
One item I noticed is that 2003 was the first year when both oecd and non-opec production decreased while overall production increased. The poor oil majors must be having a hard time being shut out of OPEC and having to rely on investments in the former soviet union to grow production.
I wonder if that is the peak for the oil major's production? Has anyone looked at the production profile for the oil majors when acquisitions and dispositions are accounted for?
Joined: May 22, 2004 Posts: 1434 Location: Ottawa, Ontario
Posted: Tue Jun 15, 2004 11:41 am Post subject:
A second look at the data shows that , no it(decrease in non-opec and oecd while increase in total) has happened before a couple of times in the 80s. My mistake.
Is this 10% growth in reserves backed up by any real oil-finds in 2003 or are countrys like Iran etc cooking the books?? (along with BP) _________________ PEAK OIL CENTER
http://members.home.nl/peakoil/
Well if I look at the table of world proven reserves I find a increase of 1.4 Bb or 0.122%. How this translates to an increase of 10% in total reserves is a mystery to me.
But I think that even a 0.122% growth is far too optimistic. If you look at the numbers.
35 out of 53 countries posted unchanged reserves compared to last year, which for me is too much to be a statistical coincidence.
The only positive revisions were made by.
Brazil +0.8 Bb
Trinidad +1.8 Bb
Russian Fed. +2.1 Bb
Gabon +0.1 Bb
Egypt +0.1 Bb
Australia +0.7 Bb
The production Gabon Australia and Egypt is already long in decline despite growing reserves, so I wouldn't put much trust in their numbers.
You also have to consider the fact that these numbers still have to be revised downwards to account for the accounting mispractice by Shell, which slashes Nigeria's and Omans reserves by over 4 Bb.
So the final picture is that although BP posts a very modest gain of 1.4 Bb, the world proven reserves have actually declined.
Since the proven reserves and the total reserves should lie on the same statistical curve, the total reserves must have declined aswell.
Posted: Thu Jun 17, 2004 2:11 pm Post subject: Help.
Help. I'm confused.
I plotted up this picture from the BP data. Consistently, world consumption is greater than world production...
How can that be?
It would appear that (13 million * 365 days =) 4.75 billion barrels of oil have appeared out of no-where over the last 10 years.
I thought govt.s were NET filling stockpiles. On the other hand, i understand that there has been a big push toward JIT (just-in-time) inventories for commercial purposes... Could that account for all that oil? That's about a quarter of all the oil we'll use this year...
Maybe I'm doing something wrong with the numbers. If anyone has any ideas as to where that oil came from, I'd love to know...
I have been wondering about it myself. Calculation of these numbers is difficult so the error margin is quite large. EiA consistently depicts production greater that demand. The difference is known as 'the missing barrels phenomenon'.
I think it has more to do with errors due to inconsistent reporting by governments and companies than with reality.
About the stocks. The oil inventories have been dropping for years. EIA tries to cover it by comparing current stocks with the 5 year average. As the oil stocks decline the 5 year average declines as well making the overall picture harder to spot. In reality petrol stocks are back to the same level as in 1981.
Joined: May 21, 2004 Posts: 158 Location: Melbourne, Australia
Posted: Sat Jun 19, 2004 9:46 pm Post subject:
Aldert wrote:
The ten-million-dollar question:
Is this 10% growth in reserves backed up by any real oil-finds in 2003 or are countrys like Iran etc cooking the books?? (along with BP)
Yep.
(thread bump).
Another question re Iran is whether their increased produciton in '03 reflects:
1. Deliberate underproduction in 00 - 02: an unlikely bit of OPEC quota discipline
2. New investment etc allowing new capacity (how long can this be sustained if so?)
3. A dead-cat bounce, with Iran really in terminal decline - the first of the Gulf States and a second member of the OPEC-11 past its peak.
(See also my post in the geopolitics forum: Note that the major and midlevel producers who are in, or are about to enter, their terminal decline include the more politically stable places like USA, UK, Norway, Canada, Mexico, Australia and Argentina).
Joined: May 21, 2004 Posts: 158 Location: Melbourne, Australia
Posted: Sat Jun 19, 2004 9:52 pm Post subject:
smiley wrote:
I have been wondering about it myself. Calculation of these numbers is difficult so the error margin is quite large. EiA consistently depicts production greater that demand. The difference is known as 'the missing barrels phenomenon'.
I think it has more to do with errors due to inconsistent reporting by governments and companies than with reality.
I agree - and you're also forgetting that there's a black market in oil. Iraq in particular had its exports limited by the trade embargo, but was smuggling a trickle of oil out for years. Libya and Iran at various times have done the same.
And OPEC members that are cheating on their quotas tend to lie about how much they actually produced.
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If anyone has any ideas as to where that oil came from, I'd love to know...
