Here is a story first reported in 2005 which is arguably the most important story of the decade.
Cantarell, The Second Largest Oil Field in the World Is Dying
At the time of that story Cantarell was producing 2.1 million barrels/day. A flow rate which has only been outdone by Ghawar in Saudi Arabia, the world's largest and most productive oil field which accounts for about 50% of Saudi Arabia's total production.
What has since been realized is that 2.1 million barrels was Cantarell's peak production rate. Today Cantarell is producing about 500,000 barrels/day and declining rapidly. That's about a 75% drop in production in 5 years. Unfortunately, this is characteristic of decline rates from aging and over produced oil fields.
Just to be clear, the world's second largest producing oil field has peaked and set into irreversible decline. In the very near future, Mexico will cease to be an oil exporter.
Which means that... Ghawar is now the last of the world's super giant oil fields. By many accounts, this field too may have already peaked as the Saudis have not been able to crest 10 million barrel/day production since 2005. Very little is known for certain though as Saudi Aramco, the Saudi Oil company, is intensively secretive about its production capabilities and reserves.
But this much is certain... when Ghawar peaks... the world will have effectively peaked on oil production.
So what is Peak Oil?
It does NOT mean that we are out of oil. It means that flow rates, currently at around 70 million barrels/day, will no longer be able to be increased to meet growing demand.
A very brief explanation as to why this happens-
All oil fields "mature" over time. This simply means that as oil is extracted from a field the internal pressures that help force the oil out become lower and lower until it becomes necessary to "force" the oil out. In a production sense, this means that the first oil to come out of a field is quite easy and cheap to get out, the latter oil becomes increasingly more expensive and difficult to extract. This pattern when graphed looks like this...
This is the North Sea, the last Super Giant find we ever discovered(back in '69 I believe)
It has also peaked sometime around 2005.
North Sea has peaked.
If you're thinking we'll just look for more oil...
... oil discoveries have been steadily declining since 1970 meaning that every year since then we have discovered less and less oil. Furthermore, fields decline all the time. Which means that every year production coming online has to first offset declines in other areas.
If you're thinking "there's plenty of oil still out there un-developed"...
... You're right! There is. But this is not a measure of reserves. This is a question of flow rates. I.E. How much oil can be brought to market in a given year. Oil in the ground is essentially worthless. It is oil in a barrel, in the marketplace, that matters.
Once global production peaks, the amount of oil that is brought to market will begin to steadily, and irreversibly decrease.
Peak Oil is a mathematical inevitability.
It is GOING to happen, it's simply a matter of when. Once it does happen, growth in demand will no longer be possible and oil will become increasingly and irreversibly more expensive.
When will it happen? No one can say for sure. Furthermore it will not be readily apparent until it has already happened. It's one of those pesky things that only appears in hindsight.
What happens to us when it does? The global economy as we know it will gradually cease to function.
Oil is the lifeblood of the modern world. Transportation, petrochemicals, fertilizers, pesticides, plastics, cosmetics, you name it... oil's a part of it.
Eventually it will get so expensive to do all those things that they will rapidly become economically nonviable.
You can conjecture all you want but it is simply impossible to predict what will happen with a change of that magnitude. Luckily, as far as I can tell pretty much nothing is being done to prepare for this eventuality.
If it makes ya feel any better, even after peak we'll still have some good years.
This girl explains it much better.
HOT Oily STRIP - Peak Oil Explained - The best free videos are right here
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Scary stuff. Well-written report Don Italo.
ReplyDeleteOn the food side, what about organic farming, no pesticides, fertilizers? We get almost all our food from an organic farm in Pennsylvania. It's a co-op of sorts.
Hey Cuz,
ReplyDeleteI don't think there will be much of an option when it comes to food... it'll be organic or nothing.
What is of greater concern to me is food transportation cost and the state of the large corporate farms. Localized agriculture has been virtually destroyed.
Nice commentary and I liked the "visual aid" by the nice young lady.
ReplyDeleteI read about "peak oil" back in '02 when Nat'l Geo ran a piece on it. If it hasn't happened already, it's right around the corner. I agree, we aren't focusing enough on making plans for when we run out of fossil fuels.
Yet, it's not just oil upon which we're heavily reliant. The power to your home is directly dependent on coal fires boiling water to make steam to drive a turbine to turn a magnet and create electricity.
Even if we do hit on cars that are powered by a cell, electricity, or the sun, we need to understand that "power" will still be fundamental. I.e., if you use an electric car, you're going to plug it in at home to recharge it. Where is that electricity going to come from?
I think we need to keep using the oil, coal, and gas that we have and develop and explore for more. At the same time, we need to put funds, time, and energy into figuring out how nuclear, wind, biomass, solar, and other alternatives can be mass produced in a manner that will support the varying loads of big cities, be cost efficient, and be safe.
The problem is doing both at the same time: Funding exploration, drilling, pumping, refining AND developing alternatives. Nations like ours are dumping unscrupulous amounts of cash into crap. It's a problem. Those funds need to be diverted into positive progress for our children, their children.
I'm not a "green" freak. I think God created a world that will be here long after we're gone. If you took every human off the earth, in just about a few thousand years, it would be like we were never here. So we're not going to destroy this planet. But we are definitely capable of making it less comfortable to coexist here.
I also believe God gave us the resources, the brains, and the opposing thumbs to use what's here. I have no problem pumping every drop of oil out of the ground, as long as at some point we also spend time and money harnessing a viable way to use alternatives for power, fuel, and products that are currently depending on oil.
What is scary for me is that Barbados is dependent on the importation of the majority of our food. The cost of living here is high to begin with because of this, with oil prices climbing it becomes increasing difficult to manage a household. I don't think any of the Governments are thinking ahead.
ReplyDeleteRight now Barbados is in a situation where more and more agricultural land is being sold for large developments, and the government is happy to pass bills for change of use of this land to make these condominium projects viable. So, umm, with one of the highest populations per square mile, where are we going to grown the food we need? Another issue in the Government's face is perennial larceny. Local farmers have been crying out to the government and the police force to help them protect their crops, and more and more are leaving their fields empty rather than lose money to the "landless farmers" who raid the fields in the middle of the night. It's sad.
So yeah, when oil prices are so high that bringing in food isn't feasible Barbados will have become another Mustique, where there are no "locals" and the servants are like those on a cruise ship.
Doom and Gloom. Love it. I'm gonna come live with you Papi. ;)
I will check my space :)
ReplyDeleteI'll be following this with great interest.