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shortonoil
Fission
Joined: Dec 02, 2004
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Location: VA USA
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 Posted: Sat May 10, 2008 12:46 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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| threadbear wrote: | | It is so not going to happen, for a variety of reasons. |
Of course it isn’t going to happen; even if it was considered, where would the $100 trillion come from in the first place. The US doesn’t have $100 trillion, the world doesn’t have a $100 trillion. I think Simmon’s was telling us politely ....... we are screwed! |
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kpeavey
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| Posted: Sat May 10, 2008 12:49 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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article quotes $50-100 trillion
$50 trillion divided by a global population of 6.5 billion =$7692 for every human alive on the planet.
it aint gonna happen
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roccman
Peak Oil Prophet
Joined: Apr 27, 2007
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Location: The Great Sonoran Desert
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| Posted: Sat May 10, 2008 1:03 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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| Novus wrote: | | See you at the bottom of the rabbit hole. |
You're on!! Enjoy the ride.
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Starvid
Fission
Joined: Feb 20, 2005
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| Posted: Sat May 10, 2008 4:04 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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$50-100 trillion?
My guess of $20-50 trillion was a bit on the low side then. 
Still, you get this feeling that Simmons want more money to flow into the oil&gas business, which just might have something to do with a certain person leading and owning the biggest investment bank for the oil&gas industry... 
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Starvid
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| Posted: Sat May 10, 2008 4:08 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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| kpeavey wrote: | article quotes $50-100 trillion
$50 trillion divided by a global population of 6.5 billion =$7692 for every human alive on the planet.
it aint gonna happen |
Let's say the cost will be $65 trillion. Global GDP is $65 trillion. Spending 10 % of GDP over ten years or 5 % over 20 years hardly seems impossible.
Especially considering the extreme growth such a massive investment program will result in. For details on that effect, see the second Hirsch report.
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Peak oil is not an energy crisis. It is a liquid fuel crisis. |
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shortonoil
Fission
Joined: Dec 02, 2004
Posts: 2726
Location: VA USA
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| Posted: Sat May 10, 2008 4:52 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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| Starvid wrote: | | Let's say the cost will be $65 trillion. |
You are making an assumption here, and that is that the world GDP will stay at $65 trillion for the next 10 years. In actuality it is about $57 trillion and the chances of it staying there for 10 years is now approaching zero.
10% is equal to the food budget of the entire planet. With the world economy unraveling at a frightening rate, spending 10% on oil infrastructure guarantees that someone is going to have to starve. That is a position that is certainly not going to be politically acceptable. |
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IanC
Heavy Crude
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Joined: Jun 05, 2005
Posts: 363
Location: Portland Oregon, USA
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| Posted: Sat May 10, 2008 5:01 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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I agree. Simmons is trying to say "The price of totally rebuilding our infrastructure is insurmoutable.
It could have easily put the price tag at "A zillion-ga-gillion Dollars" and be saying the same thing.
-Ian |
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Starvid
Fission
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| Posted: Sat May 10, 2008 5:38 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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| shortonoil wrote: | | Starvid wrote: | | Let's say the cost will be $65 trillion. |
You are making an assumption here, and that is that the world GDP will stay at $65 trillion for the next 10 years. In actuality it is about $57 trillion and the chances of it staying there for 10 years is now approaching zero.
10% is equal to the food budget of the entire planet. With the world economy unraveling at a frightening rate, spending 10% on oil infrastructure guarantees that someone is going to have to starve. That is a position that is certainly not going to be politically acceptable. |
According to Wikipedia, the world economy is $48 trillion or $54 trillion. I checked those numbers when I wrote that post I could've been damned that the numbers said $65 trillion. Anyway, it doesn't matter much.
Will world GDP grow or shrink going forward? On one hand we have a growing energy crisis, on the other hand the world economy is growing at a good speed, even great, in spite of these energy prices. Speculating if the economy will grow or shrink, or by how much, is not doable with any degree of certainty. So using the current number is as good as any.
And I wonder what you mean by "world economy unraveling at a frightening rate"? 
There are problems in the US, but Europe and Asia are doing perfectly fine, and with our strong domestic markets we don't really need the US anymore. This is especially true for the emerging markets in Asia, who get about 90-95 % of their growth from domestic demand.
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Starvid
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| Posted: Sat May 10, 2008 5:46 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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Tyler_JC
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Joined: Sep 25, 2004
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Location: Boston, MA
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| Posted: Sat May 10, 2008 6:33 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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I wonder where that $100 trillion number comes from.
Unless he can give us some information about what exactly he's talking about...I'm inclined to call this an exaggeration.
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seahorse
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| Posted: Sat May 10, 2008 7:00 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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I don't know where the $100 trillion comes from, but the 2006 IEA world energy outlook said it would take $20 trillion to develop new energy resources between 2005-2030 to meet increasing demand. So, if it takes $20 trillion to build new infrastructure (ain't going to happen), $100 trillion to replace the existing may not be that unreasonable.
World Energy Outlook
Last edited by seahorse on Sun May 11, 2008 11:13 am; edited 1 time in total |
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JPL
Light Sweet Crude
Joined: Mar 18, 2006
Posts: 1258
Location: Off with the Fey Folk
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| Posted: Sat May 10, 2008 7:30 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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You also have to factor in price inflation due to a shrinking energy base.
Think you can do the math on that one?
Betcha can't...
JP |
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thylacine
Heavy Crude
Joined: Jan 19, 2006
Posts: 121
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| Posted: Sat May 10, 2008 8:47 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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If, as Simmons says, "Peak oil is a reality. In 2005 we had peak production..." , then the $50-100 trillion he is proposing be spent rebuilding the oil industry is at best just going to produce a less severe decline. But still a decline. Two steps forward, three steps back.
And how long would the $50-100T investment keep us going for: another 10 or 20 years? He can't be serious, IMHO Simmons is just using another way of highlighting the corner into which we have painted ourselves. |
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shortonoil
Fission
Joined: Dec 02, 2004
Posts: 2726
Location: VA USA
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| Posted: Sat May 10, 2008 9:25 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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| Starvid wrote: | | Net Exports now represent under 1/20 of GDP growth in China |
Which has little to do with the fact that, according to the CIA World Factbook CIA Fact Book
37.5% of their GDP is generated from exports. Which is the highest in the world of any industrialized nation (if not any nation).
| Quote: | | There are problems in the US, but Europe and Asia are doing perfectly fine, |
If you want to call the collapse of Northern Rock, the $36 billion dollar loss for Credit Sussi, the upcoming bankruptcy of Spain, the 16% unemployment rate in Germany, the 44% increase in food cost in the UK, 5% of China’s power plants shut down for lack of coal, the Asian food crisis, and etc. doing fine, OK. |
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OilFinder2
Light Sweet Crude
Joined: Mar 26, 2008
Posts: 1366
Location: Seattle
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| Posted: Sat May 10, 2008 10:27 pm Post subject: Re: OTC: $100 trillion needed to rebuild energy infrastructu |
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| Quote: | | The oil and gas industry will need to invest $50-100 trillion to rebuild its ageing infrastructure within the next 7 years and stave off a serious drop in oil and gas production, Matt Simmons, chairman of Simmons & Co. International, told OGJ May 5 at the Offshore Technology Conference in Houston. |
Uh, yeah. What else do we expect Matt Simmons to say?
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