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Guest Post: A Long Way From Reaching Our Peak
From Sean Corrigan
A Long Way from Reaching Our Peak
Inspired, among others, by the typically apocalyptic, ecological maunderings of Jeremy Grantham (the renowned investor here providing us with classic evidence of the general non-transferability of specific expertise from one metier to another), the recent overwrought oil market has brought the Exhaustionists out in full force, each plaintively wailing of the dangers of Peak Oil (as well as Peak Copper, Peak Corn, etc.—though never, thankfully, Peek Freans).
As is always the case at such times, the name of M. King Hubbert has been given a great deal of air, as if the old rhetorical trick of argumentum ad verecundiam should be decisive in this matter.
Yes, to give this particular devil his due, he did accurately predict that US onshore oil production would top out in the late 60s/early70s, so assuring his prophethood for ever, especially since the validity of the estimate became recognised amid the traumas caused by the first Oil Shock.
His other glances in the crystal ball have, alas, not borne out quite so well, however.
World oil production was to reach its apex in 1995, he foretold in 1974: so far he is 16 years and 30% out. Nuclear energy would provide most of America’s need by around the turn of the new century, he assured us: as of 2009 the proportion was under 9%. Solar power was next seen to be the answer: 1970s technology was already deemed to be good enough to serve the entire world’s industrial needs within ‘a couple of decades’ - Oops! US production of natgas would also peak in 1970 at 14 Tcf a year: four decades on and we are rising through almost double that and with no apparent end in sight.
Even more startling, this worthy was indeed a leading light of the crank-ridden Technocratic School which, with an almost Marxian degree of stubborn denial, has been predicting the demise of the Price System—i.e., the repudiation of the process of market exchange—since the mid-1930s and pushing for an unit of energy effort expended to replace money in our reckoning, plainly not realizing that this breakthrough concept is not much more than the long-discredited labour theory of value, albeit at one remove.
At the height of their brief sway, the grey-and-scarlet clad acolytes of this Utopian movement were heard clamouring that they would sweep away ‘production for profit’ in favour of ‘production for use’ (a slogan that also has a certain familiar ring to it) and to cast out the moneylenders and politicians in favour of a rational government conducted by a Platonic elite of scientists and technicians, naturally trusting that one of these latter could ever turn out to be either Pol-Pots or peculators and confident that the world and all its people’s needs and aspirations are no more than a big, juicy simultaneous equation just begging to be solved by an inner sanctum of assiduous eggheads.
No wonder that other twisted genius, H.G. Wells took to Hubbert so avidly.
By now you may be thinking that the US Peak thing was a stopped-clock-right-twice-a-day fluke committed by a man who seems to have personified what Hayek called the ‘Fatal Conceit’ of the planners, namely that they—and they alone—can truly know how best to order production and distribution, replacing grubby commercialism with an exact calculus of abstract mass utility as carried out by a hushed order of white-coated Olympians in complete defiance of the individual subjective ordering of wants which each iota of a teeming humanity uniquely seeks to express.
But Hubbert was not the only public figure to try to apply a false, pseudo-scientific rigour to the issue of human fulfilment, nor the only one to declare that ’soon all the oil is going to be burned and all the metals mined and scattered’ or to insist that the only way out of an putative exponential growth trap of our own making is to stop people (in the impersonal abstract, of course) from having too many babies.
But, surely, your author has been recently asked, you can’t see Peak Oil theory as contentious? Is it not a mathematical inevitability, for goodness’ sake? How can you find it within yourself to demur at such trendy millennialism?
Because - oh, let me see - the planet has not yet been fully explored, much less exploited—only those bits of it which have showed the most promise given the prospect of profit (that dirty word!) and the constraints of existing technology? Because reported ‘reserves’ are, in any case, largely an accounting identity, not a hard, geological limit?
Because there is increasing evidence that abiotic, deep oil generation may be a thermodynamic reality, implying, if so, that at least some hydrocarbons would not be just a ‘fossil’ fuel, but an ongoing planetary process, i.e., ‘renewable’ in the real sense of the word?
Because it is not physical oil we want, in any case, but the energy services it provides and the state of the art today—much less that which we can realistically expected to hold good in the future—is such that, where it becomes cost-effective to do so, oil use can be cut dramatically in providing those very same services (think what the widespread US adoption of diesel cars would achieve, or the greater application of light plastics, advanced ceramics, and special alloys in their fabrication)? Indeed, we have already proved this in living memory for the West and Japan did exactly this for nigh on two decades after the second oil shock, all without the need for Green Soviet directives on what sort of light bulb we are permitted to use.
Because, that art will itself advance, the moreso that we allow market incentives to direct resources towards doing just that, meaning we might expect similarly exciting developments to continue in the fields of exploration, production and refining, not to mention in combustion, transmissions, aerodynamics, and tyre hysteresis, etc.?
Because of the phenomenon of shale gas with its enormous potential to confine oil to a narrow, mobile fuel role and even to substitute for it there, given sufficient means and motivation? (Which of the wild-eyed Doomsayers predicted its advent, by the way?)
Because, ditto—and I know no-one will want to hear this after Fukushima (despite the as-yet unquantified nature of the damage wrought there, which may even – so it please the Gods! - turn out to be as limited as it ultimately was at Chernobyl)—we can readily build a great number of new generation, uranium-cycle nukes and, better yet, fail-safe, non-pressurised, smaller-scale, non weapons-producing, thorium ones instead?
Because (admittedly in extremis, given today’s matrix of possibilities), there exist unimaginably vast, ocean-floor deposits of bacterially-generated methane clathrates all over our continental shelves (by one guess, equivalent to twice the known conventional hydrocarbon resource): when needs must, does anyone want to bet on our not being able to find a way to use them?
But, even having made all these objections – none of them exactly exercises in hare-brained futurology – there comes next the stock response: aaah, so you may deny Peak Oil, per se, but what you are admitting at least is the end of cheap oil?
Well, only to a certain point, for the laws of economics surely do apply to oil as they do to everything else to which we attach a value.
But I have yet to have someone tell me that, because an unforeseen burst of demand may require previously unprofitable, less cost-effective productive means to be temporarily applied to satisfy it, we have reached the end of ‘cheap beer’, or ‘cheap socks’, or ’cheap toilet rolls’ and that civilisation is therefore in imminent danger of collapse!
Even were we to close our eyes and allow for a moment that this most improbable of ‘certainties’ does indeed eventuate, we must beware of carrying an engineering argument over to the realm of economics where it is of no actual relevance. The putative end of ‘cheap oil’ does not mean we will henceforth have to live for ever using ‘dear oil’, just that a new dynamic will take over which will rapidly begin to compensate for the change.
After all, we don’t still fill our cars at a mark-up to the price of whale oil, or dispel the darkness from our homes on a beeswax-linked electricity tariff, now do we?
Nor does this possibility of having to find either a complete or partial substitute for oil at some indeterminate future date imply that it is at all sensible to prepare for it by squandering our scarce, present resources on such pitiable, non-sustainable, non-renewable, sub-optimal boondoggles as wind and solar.
Contrary to the Ecostormtrooper hype, we categorise them as such because - apart from the societal blight inherent in the flagrant rent-seeking and fledgling dictatorship which their forcible imposition entails - does anyone really believe that the equipment for collection, distribution, and storage of what piffling and unreliable amounts of energy are captured from such diffuse sources does not need manufacture, maintenance, repair, and replacement, in addition to the provision of a necessarily under-utilised, conventionally-powered back-up capacity and an intrusive infrastructure of access? Are we to ignore the fact that these infernal engines come complete with a huge, environmentally-significant ‘footprint’ themselves – whether it be in the concrete foundations, the rare earth magnet components, the polysilicon, or the composite materials of which each is built?
Nor should it go unrecognised that the subsidy glut in which they wallow actually prevents genuine progress being made, rather than advancing it, by making it highly lucrative for companies to swill deep and long from the public trough in return for churning out these economically sub-marginal and energetically dubious contraptions in vast profusion here, today, instead of them spending time and money seeking ways to make these systems - or any other alternatives which human genius can meanwhile discover – truly competitive and therefore unequivocally beneficial.
If, seized by a sudden fear that the world will one day lack for sufficient bicycles, our rulers summarily decide to tax both their existing makers and their heretofore satisfied users and to funnel the resulting booty to some favoured corporate giant which promises to equip us with a modestly-rejigged shopping trolley and a bargepole to propel it, we have hardly made progress, now have we?
Nor if we cut off every man’s right leg and then set up shop to sell him a prosthetic replacement can the resulting ‘Green jobs’ be said to have advanced the common weal. No. actually, we do not want another bloody Manhattan Project or any Apollo mission phallicism: we want a few more Rockefellers, Fords, and Teslas, left alone to work out how to enrich themselves by serving us instead!
To return to our original theme, the happenstance of a higher price for some good (and actually only a higher relative price, at that) should—if the market is being allowed to work properly—set in train the iterative search for a new balance which we have previously characterised as I²E²S² - that is to say, Innovation, Economisation, and Substitution, followed by Investment guided by Entrepreneurship, funded by Savings.
In this way, if left to their own devices, those despicably venal profit grubbers whom our lofty Philosopher Kings so despise will soon be busily arbitraging away their fleeting excess returns, reducing costs and increasing satisfactions for us, their customers, as they do.
Why do we think that oil—or, more broadly, energy—should prove an exception to this rule? Only, in truth, because the market is NOT being allowed to work.
Because, rather than being a true indicator of genuinely, increased scarcity or a mark of dwindling physical reservoirs, expensive oil may be nothing other than an artefact of the policies of the many governments who routinely suppress, penalize, or clumsily monopolize its production; who simultaneously subsidize its consumption—whether directly, or through general, Provider State, soft-budget outlays, or via the over stimulus of what passes for economic ‘growth’; and who—above all—routinely debase the numeraire in which the price of the stuff is reckoned.
All of these latter are, indeed, compelling reasons to invest in oil (and in any other raw materials where similar arguments apply), but they are in no way a vindication of Hubbert or Grantham or any other latter-day Malthus, crying that poor old Mother Gaia is being despoiled in the pursuit of filthy lucre!
It is much better to forget all that Sierra Club/WWF elitist, anti-mankind, horse manure about ‘the call on the planet’ exerted by us members of the ‘plague species’ and to take a little Bjorn Lomberg, a smattering of Julian Simon, and a riffle-through of Matt Ridley, regarding the minuscule size of the impact which our tiny little ilk – unimaginably outweighed by living forms we cannot even see - can really expect to exert on the vast, negatively-feedbacked rock which we inhabit—and to glory in the sustained quality of our response to the challenges which confront us, even under the far-from-ideal conditions under which we are usually asked to make it.
For example, just as an exercise in contextualisation, consider the following:-
The population of Hong Kong: 7 million. Its surface area: 1,100 km2
The population of the World: nigh on 7 billion, i.e., HK x 1000
1000 x area of HK = 110,000 km2 = the area of Cuba or Iceland
Approximate area of the Earth’s landmass = 150 million km2
Approximate total surface area = 520 million km2
So, were we to build one, vast city of the same population density as Hong Kong to cover the entirety of Fidel’s little fiefdom (not necessarily a Blade Runner vision of hell), this would accommodate all of humanity, and take up just 0.07% of the planet’s land area and 0.02% of the Earth’s surface.
Add in another patch or two for energy generation and maybe another few for growing food – perhaps by building super-efficient, CO?-enriched, drip-irrigated, skyscraper hydroponics factories, by exploiting the potential of the surrounding oceans more fully, or by bioengineering photosynthetic bugs to grow us pure nutrients – and this would partition dear old Spaceship Earth thus: six or seven bits for us weakling, co-operative mutualists and 4,720 bits for all the unimaginable cornucopia of other species to wax and wane at each other’s red-in-tooth-and-claw expense, undisturbed by human hand.
Not such a bad ratio, you might think, even if you are a Marquis de Sade, equal-rights-for-plants-and-animals (plague bacilli and malarial parasites?), super-egalitarian nutcase.
So, rather than pestering the shoppers outside Oxford Street tube as you pace up and down with your ‘End is Nigh’, FSC-approved, sandwich board about your neck, you should ponder the innate ability of an unhampered, entrepreneurially-biased humanity to discover solutions to its problems.
Nor is this to indulge in some unswerving, fingers-crossed optimism: it is a realistic philosophy based on sound (Austrian) economics and one endowed with a pretty good empirical/historical track record, into the bargain
Yes, if our political institutions were better and ideally much, much less intrusive in their scope –and, yes – if the intellectual gurus who help shape them were not so (a) conceited; (b) statist; (c) given to quack economics; (d) devoted to fashionable, Bloomsbury pessimism; and (e) prone to practice Munchausen-by-proxy denialism on the masses to whom they condescend, we would be much further along this track than we are now.
Indeed, this is the crux of the matter for if there is even a scintilla of truth to the scare stories with which the sinister SPECTRE of today’s Bio-Blofelds bombard us, what we lack is not space or resources but capital, time, property rights, and the free market exchange networks within which to exercise them.
The most pressing of our problems are not climatological or ecological, certainly not geological, but political and we will find no answers to these by dreaming wet dreams of a multi-billion genocide so the blessed residuum can potter about building composting toilets, permanently at danger of seasonal starvation, death by tooth decay, and high childbirth mortality in a cod Iron Age village (as half the Greens do), or of instituting a globally-monitored, strictly-rationed, top-down, totalitarian tyranny (what the other half get off on).
By way of contrast, consider instead that every member of that seven billion strong ‘drain on the planet’ is hard-wired with the best computer in the known Universe, one which its individual possessor is both incentivised and enabled to link up in a massively parallel, distributed process of discovery and improvement as long as he or she has even the smallest vestiges of a market structure to guide them and a certain minimum of property rights to protect them.
Consider, too, that if the proportion to the whole of Mozarts, Michelangelos, and Maxwells is even roughly constant, their likely incidence is greater now than ever it was.
That means that we might even look forward to being liberated from a tedious diet of hip-hop, installation art, and string theory, as well as to paying less to travel more miles at a faster pace in the fabulously-equipped and remarkably inexpensive, new set of wheels, sold to us by the recently–empowered entrepreneurial gentleman to our right.
And some people think we Austrians can never look on the bright side of anything!
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Thank you for making my argument.
Cantarell was driven hard to maximize current production, consistent with best industry practices, i.e. maximize NPV. What is being done at Cantarell is the same as US GOM, North Sea and any other off-short project.
You are refering to the Kern River oil field, one of the oldest in the country. What is being done to squeeze the last bit of water out of a dry sponge. The oil is very heavy API of 13, the steam flood faciliates the flow.
http://www.theoildrum.com/node/5023
Check out the production profile....
http://www.theoildrum.com/node/5098
It is down 30% since 2000....
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So, lets see, backdating reserve growth to the initial discovery, we peaked in discoveries in 1964 or so, production has exceeded discoveries since 1980 or so. Also, you fail to understand that is dQ/dt that matters, not Q.
Chew on this regarding Exxon and reserve replacement:
http://priceofoil.org/2011/02/16/exxon-is-running-out-of-oil/
Here is the money quote:
LoP, Flak we're talking past each other. Seriously, I'd be interested in what you'd say upon reading the Bottomless Well. (Candidly, its been a while since I read it.)
Hulbert gets into the energy balance, but pretty much dismisses it with economics / value. He ultimately says the best uses of energy are the most wasteful--there's some hyperbole in that statement, but its true in the main.
Here's a from-left-field approach: My favorite movie might be The Matrix. I like when Morpheus says to Neo, "Free your mind." I'd encourage you guys to get out of the physics and differential equations and think bigger. The history of humanity as been for continual increase.
No, I think you miss the points that LoP and I raise.
Think of it this way, 1 trillion barrels of goo, 250 billion equivalent barrels of stuff that can be turned into goo. That is the liquid energy endowment we have to play with and construct a new infrastructure to replace it. The clock is ticking....
My mind was set free when I figured out that oil was peaking. Once you readjust your value system, things become much clearer.
BTW, Economics is the continuation of Ideology by other means.
I understand that oil might not be infinite (although this is not the only place I've seen that it might be renewable--percolating up from below). If we let market forces operate, the oil we have will last longer, and the price signal upon decrease will motivate replacement.
(BTW, I don't mean "economics" as the social science. I mean it generically as dollars and cents.)
One thing at a time....
Renewable if your time scale is in millions of years....
We are not going to run out of oil. At some point, it's value as feedstock for a variety of products will preclude burning it... The Alberta oil sands will provide bitumen for literally 1000's of years...
Your operating market forces will not produce the outcome you desire. For all intents and purposes the infrastructure of the US is predicated on $20 oil, sustained high oil prices will induce economic collapse here. Just imagine the suburbs at $250 oil.... Your precious price signal comes way too late in the game, moreover, the price will be incredibly volatile giving mixed signals. We have had a taste of it, 2005-2008, crash, rebound. Go ahead, do a NPV analysis of alternatives given this uncertainty.
All economic activity is predicated on the leverage of excess free energy. Whether it is excess food for slaves to build the Pyramids or oil that is produced at 1/100th of the energy cost of production. Dollars and cents are mere bookeeping devices and are relative.
Compare the price of oil to a hard asset, e.g. gold, remarkably stable, all things considered.
Ignoring the utter stupidity of oil (reduced organic hydrocarbon chains) percolating up from below (what from the inorganic magma or inorganic rock?). The question of flux is an important one. You really think that a totally unregulated market of humanity will make the conscience decision to make the oil "last longer"?!?! I encourage you to look at the history of civilizations that have fallen into chaos (no regulation whatsoever) do they, have they, used natural resources like fresh water wisely? Bah hah ha ha ha ha. The powerful sequester the water (or oil) for themselves and simply kill everyone else. Not that I don't think this is the way it should be anyway, but now you are just being silly.
My point is simply that societies have shown over and over that they, left unchecked, will simply consume more and more until the are physically forced to cut back with horrible consequences. Moreover, in terms of dollars and cents, you quickly end up with monopolies and eventually a total monopolies. What utopian hippie state are you living in? We passed the point of a sustainable "flux" of resources to service the population indefinitely a long time ago. Although I do like the idea of become a fisherman in Alaska someday.
I "free my mind" every day. You have to in order to survive in Biotech. People who buy into ALL the dogma, by definition, put themselves in a box. I do my best to hired employees who are smarter than me and who will challenge my own dogma. However, at some point the bench scientist has to go to the engineer and make things real. This is were the rubber meets the road.
You want out of the box? How about this, I would argue simply that there is a finite amount of energy available in this universe that can be converted into things of value. When you reach a point were there are a relative few people (wall street, politicians, and financial fucknuts) who are extracting energy and real value at the expense of many, then there becomes a distinct shortage of energy/value left over for that bench scientist and engineer to have that discussion. Again, this is fine with me, I enjoy growing my own food etc, but it will not work for the entire population, no matter what those "scientists" at Liberty or Bob Jones university say. I would be more inclined to believe the work coming out of Cal Tech and MIT.
In a former life I was a professional cyclist, so I am not your typical scientist/engineer/CTO.
You can smoke all the dope you want and really expand you mind, but you still need to eat and drink and it is usually good if you don't live in your own waste.
WTF did I just read?
Sounds like the Grand Poobah of an Uber-Religion attacking the unbelievers. This long-winded (and boring to tears, I might add) article is a Prime example of: "The Bigger the Vocabulary, the Better the Bullshit!"
It's not Peak Oil I am worried about it is "Peak Tyranny"
Peak human stupidity.
The former will precipitate the latter. Generosity is a function of excess. In the minds of the tyrannical there is a lot of litter.
I certainly used to hope we were not approaching Peak Oil, just as now I certainly hope we have actually achieved Peak Trolls!
Most of the peak-oil-poo-pooer comments here fail to offer anything remotely resembling factual support. Is Peak Oil a fiction because production is destined to continue to increase until the absolute last moment when we deplete all reserves? Or, is that insanity discarded in favor of a peak that's just further away than we think? If peak is further away, where is this new oil going to come from if it hasn't even been found yet? Look at oil field discovery figures that the industry uses--why has oil field discovery peaked? Isn't oil field discovery the foundation for increased production? What market factors or lack of expected demand out there has caused this worldwide industry to slack off in the critical area of field discovery? How is it mathematically possible for us to increase production when we are depleting existing fields and not replacing them at a level consistent with our current depletion, much less at an increased rate (which would obviously be necessary in order to increase production and thus avoid a peak)? Ah, it must be because Aristotle was an asshole who could not accurately describe sub-atomic theory then, as Corrigan's thinking goes, we can safely reject all of his tenets concerning logic and scientific deduction.
And for those who believe in the reserve numbers, don't forget the massive downgrades by orders of magnitude that come more often than even the silver and gold depository reclassifications. ANWR was downgraded 90% from its "peak" reserve calculation heights (talk about a parabolic move). Caspian Sea basin was also a major bust in terms of its original reserve amount.
Unfortunately, Corrigan is too encumbered by the results he is compelled to arrive out, regardless of the twistic logic required to get there, that he cannot see the obvious fallacy within his own argument--market demands, ingenuity, and cost benefit should have already kicked in leading to more discoveries in order to keep the price low enough to meet demand before destroying demand through high prices. But alas, demand is now only destroyed by high price and Peak is so far beyond remaning masked that even the IEA doesn't try any more.
Of course, someone has to speak out and save us from expending the unlimited cheap energy we have now to realign ourselves under the fantasy paradigm of a supposed post-peak reality.
THIS ARTICLE IS BULLSHIT ! PEAK OIL IS A VERY REAL PHENOMENON - ALL OF YOU WHO DENY PEAK OIL WILL SOON FIND OUT HOW MUCH PAIN IT WILL CAUSE YOU AND YOUR " CURRENT LIFE STYLE "
Yes, but there is no need to shout...
God damn of ZH didn't take to Death Worship like desert dwelling jews to golden calf worship.
Christ, I don't even want to deal with this. The author was exactly spot on with his analysis. Government interference has slowed development of technology right along with stifling production. That's all there is too it. Get rid of the government, or at least stop them from interfering with energy production and research, and prices will come down. Hell, oil prices in real terms are lower than ever. High prices are 100% an artifact of monetary inflation. http://www.taipanpublishinggroup.com/images/web/smart-investing-daily/20...
But hey, let's ignore all market signals and excuse all government intervention, because we were all doomed anyways due to PHYSICS and PEAK OIL and THERMODYNAMICS.
What is your fixation on "death worship"? There is a major challenge before us. No matter what befalls us, things will be different. There are some that see a major collapse, there are other that see things evolving differently.
Trying to discredit "doomers" does not change the challenge...
I would argue that the "Free Market" has completely failed us because it is incapable of discounting FV beyond 5-10 years.
BTW, your pet technology, graphene, was the outcome of the goverment funded basic research.
Death Worship has spread among you like a plague. It blinds you to all possibility. It further blinds you to cause and effect. You see death towering before you, like an irresistible God, and you CHOOSE to kneel. The thing is, death is a lumbering giant, and easily avoided by the young, and the inventive.
I am not discrediting anyone--I am trying to make you wake up to reality. Things look bad, but they aren't bad because life has to be fundamentally bad, they are bad because we have abandoned the free market.
Christ, you don't even know what a free market is. We can't even own a business in this country any more. No-one owns anything, because we have limits placed on our actions by the government (ie, you are not allowed to pay anyone less than X amount, and a billion others).
ALL research now has a government funding component. You think research didn't happen before government funding? They don't get credit just because they take away ten dollars and give one back to research, and claim that they have saved the day, when five of those dollars would have gone to research anyways. Further, they would have been distributed as the market wanted to distribute them, not according to how some panel of bureaucrats wanted it distributed.
Further, I would add that graphene was DISCOVERED, not created. Sheets of graphene were first isolated from graphite. You might as well claim that America was a result of Spain funded exploration.
Regarding research, I suggest that you review your history of science a bit... Natural Philosophers have always relied on the generosity of the state, or were self funded (i.e. members of the landed aristocracry, the state). There was a brief period of time here in the US when a fraction of research was funded at the Univesity level out of endowments (18th-19th century). This was not sustainable because of the cost.
Lets not quibble about semantics, you do an experiment and you find something unexpected. Or in the case of Graphene, theorists were interested in the properties of single layer graphite....
"ALL research now has a government funding component."
Not true tom. Several companies funding their own research through what remains in the margins. The big difference is that is is applied science that is still research but that gets lost in translation. I agree that if companies want all the reward from taking a risk then they should also live with the failure as well. Has that happened on Wall street, fuck no. Don't be bitter because some biotech companies don't want to shoulder all the risk either. At least we get something of REAL VALUE out of the biotech. Don't expose yourself as too much of a hypocrite.
Guy, your text consistently has a tone of defiance in it, but it's defiance of your own realization, not of any external persuasion. I think you have enough technical training to understand what's happening and I think you also understand probabilities.
The odds are heavily against avoidance of death -- and this sentence does not constitute worship. It is a statement of probability.
One can certainly stand defiant at the base of Pinatubo and cry out one's hatred of the pyroclastic flow avalanching down onto you, but you seem to refuse to accept that those cries won't stop the avalanche.
You want there to be an oil scarcity solution, and you let that want corrupt your thinking into believing the microscopic odds are going to happen. I think you know they won't. You need to get past this if your children are to have any chance at all.
Hot damn ZH has hit Peak Trolls! It is not surprising to me that the banksters who own much of the oil and its by-product infrastructure would subsidize (hey, it's all just funny money to them!) quack industries which could never challenge their death grip on humanity.
Kissinger: Control the oil and you control nations; control the food and you control men.
I never thought I'd appreciate one of your comments TMosley but I really, really do. There are a bunch of fascist scumbags (who fund the genocide-in-the-billions troll crowd around here) who hate humanity and would rather see us dead tgan to lose their privileges.
Fuck them. Corrigan is spot on and has even cut down on the verbiage! And about those "fossil fuels": BULLSHIT. I'm in the minerals mining industry and it's obvious oil doesn't come from dinosaurs.
Just like the history books dint tell us about the subversion of America by the drug trafficking/money laundering banksters and even the assassinations of American presidents are kept in the dark, so it is with peak oil, global warming, "fossil fuels", ethanol, "representative democracy", the "War on Terror and Drugs (ha! The cynicism ) etc etc
"In the age of lies, even the clumsiest frankness is preferable to the best-orchestrated ruse." - Albert Camus
You are guilty of a non-sequiter of enormous proportions.
Has it not occured to you that TPTB are mortally afraid of Peak Oil? It is the end of the game for them. The Ponzi ends..
Who the fuck would pay anyone to troll about peak oil? A snap shot of the deniers is a veritable whos-who of world capitalism and the oligarchs that you bemoan...
In terms of "Us vs Them" counterculture, the peak oilers here at the hedge are the equivalent of those who bitch at the Fed and the other oligarchs. There is not a single person here that believes in Peak Oil that does not understand the need to have precious metals and other real producing assets, e.g. farmland.
"I'm in the minerals mining industry and it's obvious oil doesn't come from dinosaurs."
No shit, it came from all sorts of organic matter that ultimately got its energy from the sun. We can even engineer fucking E. coli to produce oil (See the website from the company LS9).
What is your fucking point idiot? Even the bacteria that LS9 has engineered to make oil CONSUME a carbon source to get ENERGY to drive the process. Moreover, the energy and carbon (in a perfect system it comes from CO2 and light - like in a plant or algae) has to come from somewhere and the conversion still takes time. You can only speed up cycles so much before the system is fucked. It is all about flux and how much you need to sustain a given quality of life. If you want to cycle faster, you need more energy. What happened, did you lose you shovel so they put you in front of a computer? Get back to work and stop costing the company money!
Don't be too hard on tom, he still recognizes two important things;
1) there is NO free market
2) things that can not be created out of thin air by financial fucknuts, will retain their value.
Whether or not he or anyone else is a "death worshiper" depends on whether he or anyone else believes that America would slip into chaos should the present system collapse. It would most certainly collapse if the government intervention was ended.
I view collapse as a good thing at this point because it would at least put an end to the cancer (the entire financial system) that is crushing the margins of those that actual bring things of real value to the market (like oil). Once compensation returns to people who are actually worth a shit, then we can talk about having any sort of government.
It's right there in the tagline. "On a long enough timeline the survival rate for everyone drops to zero."
Everyone gonna die duder.
Sean Corrigan just demonstrated his scientific illiteracy, proving that anything this man says is utter horse manure. Those of you who choose to believe his "argument" deserve the hell you will get. And note that he makes no actual argument, just does name calling and then does a linear extrapolation of one simplistic trend and assume the extrapolation is valid. Where have I seen this sort of crap before? Oh yeah, from Tim Geithner, Ben Bernanke, Hank Paulson, etc. So Sean Corrigan just placed himself firmly in the same mindset camp as the idiots ruining the financial system. But because he does it in an area not about finance, that most of you are not qualified to discuss, you assume that he must be right, brotha'!!
You people who believe this sort of tripe are the living proof of why the US (and the entire global technocratic civilization) is going to slam into the wall at 200 mph. No amount of scientific argument or fact will sway you from your wet dream that infinite growth on a finite planet must be possible. Yet in the next breath some of you argue stringently against infinite growth in the money supply on a finite planet (which we also know does not work).
The cognitive dissonance in this thread is exceptionally funny.
brilliant
Peak Oil represents a misallocation of problem solving resources given demand destruction in the near term.
With the passage of HR1249/S23 the US Congress will have sealed the fate of Peak American Wealth & Ingenuity by legislating the Marconi method over Tesla's.
Unfortunately, Peak DC Regulation is still a long way off.
The same holds true for Peak FED Monetization (which isn't subject to constraint by Grantham), and which cannot occur until after the termination of Cheap Everything in America.
What Was-
Franklin, Witney & Fulton, Singer & Eastman, Pemberton & Kellog, Ford & Goodyear, Colt & Browning, Edison & Tesla, Bell & Westinghouse, Northrop & Sikorski, Oppenheimer & Godard
What Is-
Bernanke & Geithner, Blankfein & Paulson, Dimon & Masters, Zoellick & DSK
What Most Likely Will Be Found Further down the Current Path-
ICE Fences & FEMA Camps, EPA & OSHA Regs, IRS Forms & Taxes
Maybe Sean Corrigan can solve the energy crisis all on his own. If he can produce this much shit out of thin-air then maybe methane gas is the future?
Awful article.
" THERE IS NO NEW OIL FIELD TECHNOLOGY THAT WILL SAVE US " This is a direct quote from MATT SIMMONS ( deceased ). Matt was arguably the most well informed and knowledgeable oil man on the planet. No amount of technology, wishful thinking or hope can defy the depleation of an oil reserve - either indivually or the planet as a whole.
I hope Corrigan's grandchildren read this article in his presence 20 years from now. They deserve to know why our species committed suicide and he deserves to die knowing they know.
Beautifully said.
I don't think I understand more or less anything in the article.
Well, maybe one thing. HG Wells died before Hubbert's peak oil paper was first presented . . . in 1956. Whoever this guy is, he seems to think HG Wells loved the paper.
Your asking the wrong question.
The question is: Why do we need cheap energy?
Answer: Cheap production.
Robots can make production vary vary cheaply, as long as there is a foundation in place for them.
Robots are the ultimate tool.
This is the era of autonomous machines. Humans will be to expensive to use in production.
Production costs need to keep falling if modern economics are to continue.
Failing robot efficiency a new economic model will be needed. Production costs will climb, as will commodity prices further feeding higher production costs.
Its all and ever will be, about costs of production. Ever cheaper production costs are needed. Cheap oil has reached its cheapest level. Oil can't become any cheaper to produce so we are seeing follow on effects. Its not about a peak its about a trough.
It will be interesting to see what comes. Robot efficiency or commodity costs.
Deflation lead by ever efficient production and human geographic growth, Or higher inflation caused by ever costly commodities and political need to print money.
The Great Debate continues: inflation or deflation, commodities or production. Energy is a means not an end.
Horrible writing. For a second, I thought this was a piece by EquityPrivate or Heidi Moore.
My head hurts (and I gave up on this long-winded piece) after this "paragraph":
Corrigan: "Even more startling, this worthy was indeed a leading light of the crank-ridden Technocratic School which, with an almost Marxian degree of stubborn denial, has been predicting the demise of the Price System—i.e., the repudiation of the process of market exchange—since the mid-1930s and pushing for an unit of energy effort expended to replace money in our reckoning, plainly not realizing that this breakthrough concept is not much more than the long-discredited labour theory of value, albeit at one remove."
What a douche.
Ya, I didn't understand that paragraph either. It's like he is sneering at technocrats that have analyzed geology and production capability decrease and then relies more or less entirely on technocrats to overcome the inevitability of those analyses.
For those without the physics background to understand that natural gas has only 1/1000th the energy of the same volume of oil, they should still be able to understand that if they keep sipping from a cup of tea, the cup will hold less and less tea than it did pre-spoon.
I actually think he makes some good points, but his writing is just terrible. In plain English:
"I believe peak oil theory and the threat of permanent higher energy prices are both wrong because as energy prices rise, new sources of supply and substitutes will become economically feasible to meet future demand."
"new sources of supply and substitutes will become economically feasible to meet future demand"
This is a fundamentally flawed statement that is not factual. The correct statement should be "YOU HOPE new sources of supply and substitutes will become economically feasible to meet future demand".
Maybe, but there has to be a stable system in place that makes sure people who bring real value to the economy are compensated, not some fucking paper pushing fucknuts.
Nature makes no promises. I am sure that the thousands of cultures that came before us and ended in cannibalistic chaos (and there are many) believed the same thing. How is the whole "mark to unicorn" accounting thing working out again?
I like the whole positivity vibe this dude has happening.
And it's easy to see his justifications--everywhere we look, there are major changes being embraced by all to increase society's efficiency and develop better ways to live in less space with expenditure of less energy and consumption of less...
Oh...wait.
Nevermind.
Finding facts in this article is harder than finding new sources of petroleum. Those few that do exist have zero to do with oil production. Hong Kong could house 18 billion people and it would not change the reality of peak production (especially EROEI) in the slightest.
This is incredible crap. I hope someone got a lot of money for it. Probably from an ExxonMobil bank account.
There is so much bullshit in this "article" it would require pages to debunk all of it. There are many good sources for finding real information. I recommend The Oil Drum as relatively unbiased. It's worth noting that event the EIA is now acknowledging peak oil and near-future supply issues.
fuck all you 'peak' everything people. People been saying shit for over 40 years and none of it happens, just be forthright and give us your green socialist agenda instead of wrapping it up in 'peak' bullshit
See, this is where so many have it wrong.
Peak oil is a conservative issue, not a left wing issue.
It isn't going to matter what reduction of consumption you try. Capitalism strives for efficiency, meaning, there is no slack to cut. If you cut consumption, you cut economic activity. Period. Demand destruction is economy destruction.
So Peak Oil is not socialist green agenda. It is conservative, in that its inevitability compels us to launch pre-emptive strikes on competing consumption (aka population centers). There Is No Choice.
I get a howl about how peak oil is left wing enviro-wackiness...
Go to the oildrum or here for that matter, you will see all political stripes lined up behind the peak oil banner....Hell, one the most hardcore guys at theoildrum is a hardass with a libertarian bend, Rockman, he's only been in the oil business since Nixon was president....
"And some people think we Austrians can never look on the bright side of anything!"
Yes, because Austrian economic theory, trumps reality, science, basic math, and common sense. That's pretty weak sauce, Sean. This is so poorly argued that I almost think someone from the Peak Oil group wrote it to discredit the other side. It doesn't stand up to even the slightest bit of scrutiny. This kind of Austrian logic is just as clouded and utopian as anything the Communists have attempted.
These slightly manic/desperate arguments that we are seeing more and more of that implore us to let the market sort out the serious gaps in resources coming our way are delusional and dangerous. We are sleepwalking into the future with this kind of logic. There is no second planet for us to supply the resources now needed to supply consumer driven economies of the US, Europe, China, India, Brazil and whatever other newly minted free market economies you want to list. We have successful exported and marketed this free market consumerism model to the rest of the world as the best of all possible societies and we will now pay the price as there literally isn’t enough raw material to make this stuff. Some serious belt tightening is coming our way, and no amount of google engineering or creative entreprenuerial spirit is going to change that.
Not that this is a bad thing in the bigger picture, but for all you wall street stock shills don't count on it as an recipe for endless growth, dividends and stock splits.arket economies you want to list. We have successful exported and marketed this free market consumerism model to the rest of the world as the best of all possible societies and we will now pay the price as there literally isn’t enough raw material to make this stuff. Some serious belt tightening is coming our way, and no amount of google engineering or creative entreprenuerial spirit is going to change that.
Not that this is a bad thing in the bigger picture, but for all you wall street stock shills don't count on it as an recipe for endless growth, dividends and stock splits.
Peak oil seems to be me to be true as long as the argument is correctly defined. Individual oil fields do decline to the point where they are unusable, this is neither debated nor controversial. Extrapolating that argument to the sum total of oil fields on the planet also seems quite logical and all available production data does appear to indicate that we have hit peak oil production already. Discounting for the mendacity of the ruling political and financial elite and their "reserve estimates" it appears that every important oil exporting country with the possible exception of Saudi Arabia (big country, small population) is approaching the point where they will need to soon import oil to meet domestic needs. USA hit this point 30 years ago and Mexico and Iran are near that point today.
Peak oil being true does not mean we are about to run out of energy, it only means that the days of cheap petroleum are behind us, nothing else. There are loads, virtually unlimited quantities of hydrocarbons in various forms available to us at varying financial and ecological costs. Peak oil deniers are quick to say that we are not running out of oil becuase we have found lots of natural gas, or tar sands, oil shale, or new petrol fields under the ocean. This argument misses the point entirely. Peak Oil is a narrowly defined concept and refers specifically to defined commodities. To say Peak Oil is not true because we have natural gas is simply a fallacy of substiting apples for oranges.
We are not about to run out of energy or energy products. There is lots of opportunity to create new commodity products from currently underutilized resources. Non food based biomass, Thorium nukes, waste to energy, algae, the list goes on. Neccessity is the mother of invention, as petrol derived products become costlier substitues will emerge, its not wishful thinking but simply a small bit of faith in humanity to solve problems (hopefully before we kill ourselves and the planet).
One final word on abiotic oil production, show me evidence of any proven abiotic oil ever being found, or I will continue to place it in the category of wild eyed fantasies (might be true, I just want to see proof).
We need 3 new Saudi Arabia's just to offset the decline of the current fields. Peak discovery was in 1964.
You shouldn't need anymore information than that to think "fuck".
Game over.
P.S. The dick also forgot Nikola Tesla from his list of people who were needed, no Tesla no A/C, no "modern" civilization.
Likely another piece that will continue to inflame confusion into our science illiterate population.
well if we ever do have to face peak oil theyve already invented the solution... guns and butter
Guns, butter, and silver. Buy the DIP!
J/k
My savings are going towards food and medicine. I've already got a gun, and plenty of ammo.
Investing in commodities just seems like a begging for a beating. But I like the way this guy put it:
http://collegemessiah.blogspot.com/2011/05/silver-isnt-dead-but-it-is-to...
"But here's the neat thing about silver. It doesn't really "lose" value. At one time in history a roman private was was the equivalent of around three (3) ounces of silver a month in pay. How cool is that? You can measure your savings by months of backbreaking work as a roman soldier. A more sinister, but even more staggering way to view silver...."
:P I could spend my hard earned cash and get paid the same monthly wage as a roman private.
In shiny metal.
....
Let's not sugar coat it... the jackbooted neo-Malthusians are trying to use pseudo-science to try to grab control of energy, food, and water so they can ration vital resources to control humans. Control means they can implement their Utopian Fundamentalism from the NWO pulpit with impunity. This is not tinfoil hat stuff folks. They're straight up about it, just visit any of their many websites. You'll know you're there when you see the links to Karl Marx.
Agree with abiotic oil and thorium reactors. Abiotic oil is worth following the compelling evidence to rule it in or out, and India already has operational Thorium reactors that can be vastly improved upon. The US also remains a superpower in coal, natural gas and shale oil. We should be energy exporters to help pay for any conversion to other dubious "alternatives" which will take 25+ years and trillions of dollar to build out.
What could we do right now? If our Dear Leaders were really serious about energy independence, grid security, and helping the planet, they could immediately change the net-metering laws across the country to make residential wind and solar alternative conversions attractive, and reasonably profitable, for the individual.
Empower individuals, not the crony, and sclerotic, energy monopolies. Net-metering changes would turn millions of individual residents into mini-entrepreneurs who would voluntarily use their own money to pay for the infrastructure conversions without any taxpayer money or local bonds.
Individuals should get reasonably reimbursed for the building of millions of micro-generation sources of energy tid into the grid instead of getting ripped off. The best micro model(s) would quickly emerge along with new innovations and a whole new industry and small business opportunities would spread rapidly.
Opportunities for manufacturing products, maintainence people, and investments in leasing land from individuals could be the next new thing. And the grid would become mroe diverse, stable, and much more impervious to cyber attacks and outages if a couple of milion people were helping to power the grid. It's right there ready to happen, except for the lack of net metering incentives which is being suppressed to protect the energy monopolies.
We just need to get the power company lobbyists and government out of the way.
Don't disagree with everything you said, and I like your comments about metering..but
That shit is just over the top... so Hubbert was in essence a Marxist? Anyone that looks at resource use and what have you, that doesn't come up with an answer to your liking is a jack-booted neo-Malthusian. Come on. Is the fuel gauge on your car part of that conspiracy?
Dude, don't overthink it. As soon as you see a reference to "Marxist" from the free-markets crowd around here, that's a 100% accurate flag that they don't know anything about the subject.
Seriously. It's exactly the same as the fundamentalist Xtians who start talking about the evils of Islam.
Meanwhile, gwar here has great hope for a quick solution: just change the LAWS. Yeah, right, brilliant. The government will fix it.
Derp derp.
True....
To most here, Marxists are like the boogeyman, everywhere until you actually have to look for one...
In case any pinheads are reading this and your reading comprehension is limited. This post is not an endorsment of Marxism.
Time out; these states uniteds coal be going brown and quickly and as for world petroleum, one must look at barrels in to barrels out; it went from 1:100 to 1:7.7 real quick. Shale be at best 1:5............NG will buy these states united some time but it be not long enough. Peak be peak; on food, water and the most alarming is the very air that thee breath. Phytoplankton be dieing off faster than a cut into the wind... Verily I say that conservatism be a way of life and not some tory toss pot politikal ideology hijak'd by the flat earth free trade fascisti.
well, sean, thx for being you!
you too, tyler! unfreaking-believable, you shitheadZ!
An article filled with facts seems to have caused a great disturbance among those who have subscribed to the Peak Oil religion. Quite well done. And the nutters who still believe in Peak Oil will not be able to truthfully say that "no one told me."
Wanna spar with, in your words, a "nutter"?
Care to lay out his "facts", we can discuss them. Ball is in your court, but I do suggest that you simply STFU...
Augustus & jmoney & dexter_morgan You are POO POO HEADS and totally fucking ignorant of the mathmatical facts surrounding PEAK OIL !!!!!!!
I notice alot of people don't belive in the free market solution to Peak Oil. But, isn't the reality that we haven't allowed the free market a crack at it? Isn't it the governments who locked us into the oil mantra and led our capital markets into the ditch, from which alternative energys will not be sufficiently studied and implemented?
VyseLegendaire - you need to do some SERIOUS research into the PEAK OIL situation - The free maket cannot make up for resorce depletion. Alternatives at present make up less than 1% of our energy need. GOOGLE " The Hirsch Report ". You can begin your education there.
"end of cheap oil"
Let's see. In 1964 a 1964 (90% silver) quarter bought 1 gallon of gasoline.
Today, a 1964 silver quarter is worth $6.31 (and this is after the recent downward correction back to a stable increasing line). This buys about 1.5 gallons of gasoline. Cheap oil now! (see coinflation.com)
The problem is less the end of cheap oil, and more the age of a cheapening dollar.
www.gold-silver.us/forum
Pretty fantastic article.
Thanks, Sean, I'm with you on this. Maybe there are a few cheap shots you could have avoided and "abiotic oil generation" is to vague and not necessary for the argument, but otherwise - yes.
Quite amazing and sad how most of the posters are blinded by complexity and unable to break it down to the essential. Julian L. Simon's book helped me see the light.