Posted: Thu Mar 29, 2007 12:27 pm Post subject: GAO Report on the Peak and Decline of Oil Production
CRUDE OIL:Uncertainty about Future Oil Supply Makes It Important to Develop a Strategy for Addressing a Peak and Decline in Oil Production
Quote:
The U.S. economy depends heavily on oil, particularly in the transportation sector. World oil production has been running at near capacity to meet demand, pushing prices upward. Concerns about meeting increasing demand with finite resources have renewed interest in an old question: How long can the oil supply expand before reaching a maximum level of production—a peak—from which it can only decline?
GAO (1) examined when oil production could peak, (2) assessed the potential for transportation technologies to mitigate the consequences of a peak in oil production, and (3) examined federal agency efforts that could reduce uncertainty about the timing of a peak or mitigate the consequences. To address these objectives, GAO reviewed studies, convened an expert panel, and consulted agency officials.
What GAO Found
Quote:
Most studies estimate that oil production will peak sometime between now and 2040. This range of estimates is wide because the timing of the peak depends on multiple, uncertain factors that will help determine how quickly the oil remaining in the ground is used, including the amount of oil still in the ground; how much of that oil can ultimately be produced given technological, cost, and environmental challenges as well as potentially unfavorable political and investment conditions in some countries where oil is located; and future global demand for oil. Demand for oil will, in turn, be influenced by global economic growth and may be affected by government policies on the environment and climate change and consumer choices about conservation.
Posted: Thu Mar 29, 2007 12:43 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
1. There is no attempt in this report to enlighten the reader to the difference between "reserves" (how much oil in the ground) and anticipated RATES OF EXTRACTION. The reserves fallacy quietly rules.
2. There is no mention of the problems of GROWTH. Future growth is simply assumed and not counted as part and parcel of the problem.
3. There is no mention that although EOR (enhanced oil recovery) accounts for about 12% of US production, EOR HAS NOT REVERSED THE DECLINE IN THE US.
4. Definite supply side bias. Albert Bartlett's ironic words quietly haunt me: "The faster we extract the oil and burn it, the better off we'll be."
5. Natural gas peak and decline is simply IGNORED--even in the section about GTL.
6. Any studies by the near-term peakers--Deffeyes, Campbell, Bahktiari, Jeffrey Brown, et cetera--are simply ignored in the body of the text (although, interestingly, Richard Duncan appears in one note).
7. I simply cannot get over the fact that natural gas supply decline in the us is IGNORED.
There is nothing here to incite interest or action, I'm sorry to say. _________________ "By the time individuals discover that remaining resources will not be adequate for the next generation, the next generation has already been born. " David Price
Posted: Thu Mar 29, 2007 2:31 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
Well, let's see:
Appendices III and IV detail the potential increases in nonconventional supply, and also possible transportation alternatives, etc. as follows:
Code:
Item Effect on Production/Consumption page
Enhanced Oil Recovery 1 mbpd by 2015, 2.5 mbpd by 2025 54
Deepwater Drilling .7 mbpd by 2015 56
Oil Sands 1.9 mbpd by 2030 57
Heavy Oil 50,000 bpd in 5 years 59
Oil Shale 1 mbpd by 2015 60
Ethanol 9-18 billion gallons by 2015, 60 billion gal by 2025 63
Biodiesel increase 2.5 billion gallons by 2015 64
Coal GTL 80K bpd by 2015, 1.8 mbpd by 2030 65
Biomass GTL 1.4 mbpd by 2030 (none by 2015) 66
Natural Gas displacement 1500 million gallons per year (current) 67
Advanced Vehicle Technologies 20K b/d by 2010, 1.07 mbpd by 2025 68
Hydrogen vehicles .28 mbpd by 2025 70
So if everything goes perfectly, we might be able to find another 6-7 mbpd by 2025-2030 time frame using the above technology stuff and nonconventional supplies.
It also says that the EIA thinks consumption will increase about 7 mbpd by that time, to 27 mbpd. If you do the calculation on this, it means they are assuming only 1.1% annual demand growth. Thus far this year, the reality has been more like 2.5-3.5% most of the time.
So this means that if existing production constant (which it's not) and demand growth being about half of what it is, we might be close to avoiding any sort of shortage situation in that time frame.
So it never does come out and say "if oil peaks in this time frame we are hosed" but in essence, this is what the numbers say, because there is no way to scale up the alternatives fast enough.
The bibliography is on page 53, by the way, and includes all of the PO regulars, balanced by a similar number of cornucopians.
Joined: Mar 18, 2006 Posts: 1149 Location: Last outpost of Civilisation
Posted: Thu Mar 29, 2007 2:58 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
Damn-it I was pinning a lot of hopes on this one (
Even my own government could have done it better, I read a French govt. report about a year ago (sorry I have lost the URL) that put a tenative date for global oil Peak at about 2013. I think our government is trying to put some plans together, based on the report, but all I have seen so far is plans to build some more nuke-stations & subsidise bio-diesel (sigh).
Of course there is very little that France can do about the global situation. But I guess we were hoping that the Americans would take a lead at some point. A bit like Carter did in the 70's. I guess we're all on our own, from this point on then (unhappy...)
JPL _________________ The three most beautiful things in the world -
a full-rigged ship, a woman with child and a full moon.
Joined: May 15, 2005 Posts: 4144 Location: THE MATRIX
Posted: Thu Mar 29, 2007 3:13 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
Good points Mike yet ultimately I agree with Stuart Staniford in that "just the legitimization of the debate is a big deal" and that this may be the best we can hope for on this level at this time.
Of course many peakers will define this as alittle too little alittle too late yet I cannot help but think of it as the something that is better then nothing.
Not very powerful as many had hoped yet not powerless either.
A knife is not a sword but it still cuts. _________________ It is easier to enslave a people that wish to remain free then it is to free a people who wish to remain enslaved.
Joined: Mar 18, 2006 Posts: 1149 Location: Last outpost of Civilisation
Posted: Thu Mar 29, 2007 4:09 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
NEOPO wrote:
Good points Mike yet ultimately I agree with Stuart Staniford in that "just the legitimization of the debate is a big deal" and that this may be the best we can hope for on this level at this time.
Of course many peakers will define this as alittle too little alittle too late yet I cannot help but think of it as the something that is better then nothing.
Not very powerful as many had hoped yet not powerless either.
A knife is not a sword but it still cuts.
Hi NEOPO
No, the knife is squishy and then turns out to be a stage-prop. This report has been written by people that were looking over their shoulders' for clues and there is nothing that says to the lay reader 'we have a problem'.
OK, so according to the report, Peak is somewhere between NOW and 2040. Well, on a median calculation, I'll be in my 60's before 'I' have a problem....
Posted: Thu Mar 29, 2007 4:28 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
JPL wrote:
Me, I'm just waiting for Monte to air his bit. I think what he's going to say right now may be worth listening to...
JPL
Digesting the report...but for now, stop agonizing about the "now to 2040" peak date, focus on this one sentence from the report.
Quote:
However, there is no coordinated federal strategy for reducing uncertainty about the peak’s timing or mitigating its consequences.
In the infamous words of Matt Simmons, " We have no plan B."
However, the GAO did write this:
What GAO Recommends
"To better prepare for a peak in oil production, GAO recommends that the Secretary of Energy work with other agencies to establish a strategy to coordinate and prioritize federal agency efforts to reduce uncertainty about the likely timing of a peak and to advise Congress on how best to mitigate consequences." _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Posted: Thu Mar 29, 2007 4:49 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
Also, it was quite obvious that the report was focused on "finding a way to keep the gas tanks full" and little else.
No mention of conservation.
No mention of efficiency.
No mention of mass transit.
No mention of wind, solar, wave, tidal, or nuclear. Either because, like the Hirsch Report, they are not considered viable mitigation wedges, or you can't put electricity in a gas tank.
Or, as I have been pointing out for over two years on this site; the lack of transmission capacity.
Quote:
Officials told us that plug-in hybrids face infrastructure challenges, such as the capacity of household electric wiring systems to recharge a plug-in, and the capacity of the electricity grid if plug-in hybrids are widely adopted.
We will never have the possibility of a fleet of electric vehicles powered by the grid until we rebuild the transmission grid; the substations, powerlines, transformers, etc.
Cost? Trillions.
It did do a pretty good job of trashing the current alternative fuel candidates as unscalable, very costly, or in "developmental" stages, not to mention the huge costs and time frames for the supporting infrastructure. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Last edited by MonteQuest on Thu Mar 29, 2007 4:53 pm; edited 2 times in total
Posted: Thu Mar 29, 2007 4:51 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
If they came out and said 'Peak Oil has probably happened or will certainly happen by 2012' what would the response be? Complete denial, most likely. This is actually a good way to alert our gov't that there is a problem ahead.
On the other hand, wasn't the Hirsch Report written for the Dept of Energy? DOE has had this info for a couple of years already. _________________ Civilization is a personal choice.
Posted: Thu Mar 29, 2007 5:05 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
MonteQuest wrote:
Also, it was quite obvious that the report was focused on "finding a way to keep the gas tanks full" and little else.
No mention of conservation.
No mention of efficiency.
No mention of mass transit.
No mention of wind, solar, wave, tidal, or nuclear. Either because, like the Hirsch Report, they are not considered viable mitigation wedges, or you can't put electricity in a gas tank.
Or, as I have been pointing out for over two years on this site; the lack of transmission capacity
Well, to be fair Monte, it appears that this report wasn't designed to suggest mitigation options but, rather, to illustrate the problem at hand. I'd surmise that it is up to the agencies charged with formalizing a response to this (DoE, DOT, etc.) to come up with those solutions. _________________ "It's called the American Dream because you'd have to be asleep to believe it."
Joined: Jun 21, 2006 Posts: 1205 Location: Burgundy, France
Posted: Thu Mar 29, 2007 5:21 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
JPL wrote:
Even my own government could have done it better, I read a French govt. report about a year ago (sorry I have lost the URL) that put a tenative date for global oil Peak at about 2013. I think our government is trying to put some plans together, based on the report, but all I have seen so far is plans to build some more nuke-stations & subsidise bio-diesel (sigh).
To be fair, France is subsidising solar and other sustainable electrical sources to the tune of 30 cents per kw/h (and 55 cents per kw/h if on the roof) for grid connection, and they subsidise installation to the tune of ~ 40% of capital costs as well. OK, it's not going to solve the problem, but does show awareness that there is a problem (I can't realistically see them doing this purely for Kyoto, there must be an understanding of future energy needs as well). _________________ All that we are is the result of what we have thought. The mind is everything. What we think we become. - Buddha
Posted: Thu Mar 29, 2007 6:16 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
emersonbiggins wrote:
Well, to be fair Monte, it appears that this report wasn't designed to suggest mitigation options but, rather, to illustrate the problem at hand. I'd surmise that it is up to the agencies charged with formalizing a response to this (DoE, DOT, etc.) to come up with those solutions.
I agree with Monte (first time for everything). It isn't just a report to illustrate the problem, but also to suggest mitigation measures. Here are the objectives of the report as stated on page 2, left column:
Quote:
GAO (1) examined when oil production could peak,
(2) assessed the potential for transportation technologies to mitigate the consequences of a peak in oil production, and
(3) examined federal agency efforts that could reduce uncertainty about the timing of a peak or mitigate the consequences.
I've only skimmed it so far and done some keyword searches, but I haven't found anything on mass transit or wind/solar/etc., and only passing mention of conservation efforts that could mitigate PO. The main mitigation measures they examined apparently focus on keeping liquid fuels in our personal automobiles, i.e., maintaining the status quo.
But to their credit, the GAO don't appear to have touted any of the alternative fuels as "the solution." On the contrary, they point out the many problems with using these fuels to replace oil.
Quote:
The technologies we examined currently supply the equivalent of only about 1 percent of U.S. annual consumption of petroleum products, and DOE projects that even under optimistic scenarios, these technologies could displace only the equivalent of about 4 percent of annual projected U.S. consumption by around 2015. If the decline in oil production exceeded the ability of alternative technologies to displace oil, energy consumption would be constricted, and as consumers competed for increasingly scarce oil resources, oil prices would sharply increase. In this respect, the consequences could initially resemble those of past oil supply shocks, which have been associated with significant economic damage.
Posted: Thu Mar 29, 2007 6:54 pm Post subject: Re: GAO Report on the Peak and Decline of Oil Production
emersonbiggins wrote:
MonteQuest wrote:
Also, it was quite obvious that the report was focused on "finding a way to keep the gas tanks full" and little else.
No mention of conservation.
No mention of efficiency.
No mention of mass transit.
No mention of wind, solar, wave, tidal, or nuclear. Either because, like the Hirsch Report, they are not considered viable mitigation wedges, or you can't put electricity in a gas tank.
Or, as I have been pointing out for over two years on this site; the lack of transmission capacity
Well, to be fair Monte, it appears that this report wasn't designed to suggest mitigation options but, rather, to illustrate the problem at hand. I'd surmise that it is up to the agencies charged with formalizing a response to this (DoE, DOT, etc.) to come up with those solutions.
Yes, it was. They clearly said it was to "assess" mitigation options.
Look under Scope and Methodology.
Quote:
To assess the potential for transportation technologies to mitigate the consequences of a peak and decline in oil production, we examined options to develop alternative fuels and technologies to reduce energy consumption in the transportation sector.
However, like is said, the focus was on filling the gas tanks in the transport sector. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
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