Conventional Wisdom, Unconventional Oil

Guest Post by Willis Eschenbach

There’s a discussion over at Judith Curry’s excellent blog, about peak oil. I find the whole madness surrounding peak oil to be one more example of our human love for warnings of future disaster. Few people want to hear that tomorrow will be OK, that things will work out. Instead, most folks want to hear some terrible story about what tomorrow holds, whether it’s peak oil or climate meltdown or the coming ice age. Go figure.

conventional oilFigure 1. Conventional oil leaking out of the ground near McKittrick, CA.

One part of the discussion of peak oil that has always bothered me is the division of oil into “conventional oil” and “unconventional oil”. Here’s why I think that division makes no sense with regards to peak oil.

I’ve lived through much of the whole peak oil deal, which near as I can tell has turned into a half-century-long goat roping contest. During the earlier years, people were shouting that the oil would run out, that the top would be very soon now, we’d hit the peak and by gosh, at that point things would turn ugly. Of course, that still hasn’t happened, so the peak oilers were left with the question pondered by failed doomcasters throughout history, viz:

How the heck do I explain the cratering of my position and still maintain some shred of my reputation?

For the peak oil folks, salvation came in the form of “unconventional oil”. Now, we’re assured, oil is still running out, so they were right all along … You see, they say, King Hubbert was right, we’re running out of conventional oil, but as it runs out it is being seamlessly replaced by “unconventional oil”, so we still have oil even though we’re running out of oil. Got it?

The strange part is, when you open a barrel of unconventional oil to see what conventions were broken in its creation, you find it is indistinguishable from conventional oil.

What is unconventional oil? Well, we could start by considering the conventions regarding oil. For literally billions of years the convention was that oil was found in small pools and seeps like you see in Figure 1. Indeed, the discovery of oil in Oil Creek, Pennsylvania, the site of the first US oil well, came about because oil had been seeping out there for untold centuries, and had been known and utilized by the Early Asian Immigrants in the area before the later arrival of the melanin-deficient crowd.

So conventional oil, by ancient hallowed convention handed down through the millennia, is found in tar pits and oil seeps on the surface. Which means that people being so rash as to drill for oil, by definition, would be pumping up “unconventional oil” … but of course, life is not that simple.

As a result, “conventional oil” is not from the conventional method of dipping it up in a bucket from a seep, but by the decidedly unconventional and at that time unheard of method of drilling a hole in the earth to get it to come out …

Things went along just fine like that for years. Then “secondary recovery” methods started to come into use. These were a variety of physical and chemical methods used to squeeze more oil out of existing fields, including fracturing the rock to allow the oil to come out more easily.

Now, about this time, the whole “peak oil” story started to go south, because no matter how much peak oilers howled there was more oil discovered every year. Every year the proved reserves just kept growing. And that process has continued to this very day, with more proved reserves than ever. How were the peak oilers to explain it? Hey, “unconventional oil” to the rescue!

oil will peak in 2012

For example, thinner oils were “conventional”, but thicker, more tarry deposits, despite having been utilized by humans for centuries, were “unconventional” oil, so they weren’t counted regarding the peak.

The real laugher, however, the place where you can see the gears stripping, involves the “conventions” about fracturing the rocks to allow more oil to come out, what we call “fracking”. The fracturing technology was developed about forty years ago, and has been used ever since, mostly for secondary recovery. And for all those decades the oil coming from the fractured rocks has been “conventional oil”. But now people have learned to drill wells horizontally and fracture them … and now suddenly after forty years of fracturing the rock, which gave “conventional oil” when it was done from vertical wells, fracking now only delivers “unconventional oil” simply because the drill hole goes horizontally instead of vertically … does this make any sense to anyone?

The classification of oil from fracking as “unconventional oil” shows clearly the ludicrous nature of the dividing line when we are discussing peak oil. Regarding the putative peak, why is oil from a horizontal well “unconventional” and oil from a vertical well “conventional”? It is all gotten by technology, and none of it is any more “unconventional” than the drilling of the first oil well, a most unconventional act …

Calling oil from horizontal wells “unconventional” is crucial for the peak oil folks, however, because if the oil from fracking were classified as conventional oil, the “peak oil” claims and the “peak gas” claims would sink of their own weight …

Look, folks, the ugly truth is that the world is awash with fossil fuels. To start with, The largest single concentration of fossil energy on the planet is the Powder River coal formation in the Northern US. The world has several hundred years worth of coal. The Canadians have huge amounts of oil … of course it too is called “unconventional” oil, because it alone is enough to blow the “peak oil” claims out of the water. Plus now we have the “tight oil”, oil in the rocks that is, of course, unconventional.

Then we have the discovery of the shale gas resources all around the planet. Even Israel finally has some domestic energy resources. How unconventional is that? Australia just announced a huge find. China has massive gas resources. A preliminary assessment says including shale gas we have enough gas for the next couple of hundred years.

And finally, we have the wild card, the methane hydrates, the “ice that burns”. Estimates of the amount of these are all over the map, but all of them share one feature—they are very, very large, on the order of quadrillions of cubic feet. This is rivals the size of the global natural gas resource …

methane hydrates

Finally, most of these forms of fossil fuels occur in combination and can be converted into one another. Coal, for example, can be converted to a liquid fuel, or to a gas.

Now, because there never was anyone hollering about “peak coal”, there’s no such thing as “unconventional coal”, despite huge changes in mining technology. Coal mining has changed as much or more than drilling for oil … so why isn’t there “unconventional coal”?

But in that case, since all of the coal on the planet seems to be “conventional” coal, if we convert coal to oil, are we making “conventional oil” or “unconventional oil”? Presumably it would matter whether we converted coal to oil horizontally or vertically …

In summary, once you get past the nonsense of “conventional” and “unconventional”, there’s enough coal and gas for a couple hundred years, and enough oil for a hundred years, just with what we know about now, and that’s not even counting methane hydrates. Which is why I pay no more attention to the peak oil alarmists than I do to the climate alarmists. One group claims we have too much oil and we’re gonna burn it all, the other group claims we’ll soon have too little oil to burn, and I treat those two impostors just the same.

Was the division between “conventional” and “unconventional” oil devised to cover up the failure of the peak oilers? No way. The distinction is useful in a variety of ways for analyzing the world of oil sources. I think that the concept was simply appropriated by the peak oilers because it was very useful to them, since it totally obscured the failure of their peak oil predictions. To me, oil is oil is oil, and if you claim the world will run out of oil, you can’t later say that you have redefined things, and that the oil that proves your prediction wrong is some other special kind of oil that doesn’t count as oil but walks like oil and quacks like oil …

w.

… Oh, yeah, the weather report. Late night again, two AM. The wind has changed and is blowing from the southwest, landcasting the fog and the smells of the ocean. The characteristic sea smells of iodine and dimethyl sulfide in the fog draw my thoughts back, back to the many mornings I spent getting out of bed here on the hill at 4 am and going down to the harbor, rigging the boat and setting out in the dark to have the commercial fishing gear in the water for the dawn salmon bite. Sliding out of Bodega harbor in the half-light with my gorgeous ex-fiancee and my good friend, once again motoring between the rock jetties at the harbor entrance, going out to discuss matters of life and death with the ocean. I love the ocean because it doesn’t give a damn about a man’s position and his power and his pretenses. Knowledge and experience mean nothing to the ocean. After a life at sea, if I put one foot wrong, I get just as wet as the landlubber falling off the dock … I take pleasure in that ultimate equality and justice of the ocean. I know that even if it is a California ocean it would kill me without first asking me to share my feelings, so leaving the safety of the harbor is always sobering moment …

rock and the hard place

… sneaking out between Bodega Rock and Bodega Head itself, the little shallow passage the fishermen call “between the rock and the hard place”, where once my heart almost stopped with fear, or at least it started with fear, but other emotions got involved. The channel there is shallow, the sport fishing boat “Mary Jane” was capsized in 1986 with the loss of nine souls by a sneaker wave, “full fathom five thy fishermen lie, of their bones are coral made” …

So when I heard a wave break right behind our little fishing boat one afternoon as we were coming in between the rock and the hard place, my first thought was that we were about to join the folks from the Mary Jane.

We spun around, and aaaah, dear heavens, it wasn’t a breaking wave at all, although a wave was breaking, instead it was my old friend Missus Fishbreath breaking the surface just behind the boat, and breaking my heart with the slow-moving stillness of her majestic beauty, a great gray whale dancing her way three thousand miles from the tropics to Alaska. As we turned and gaped, we were looking her right in the eye, and then she rolled our way and opened her blowhole so close to the boat we could almost look down it, it was as big as a dinner plate, we were close, close enough to count the barnacles clinging to her hull, she was the very picture of natural wildness and glorious beauty and unimaginable power, my heart leapt to see it  … and she blew out a great cloud of gagging mist, a noxious enveloping adherent miasma reeking of the million vanished piscatorial souls of her most recent month’s meals, a clogging, thick effluvium that enveloped the boat and then drifted away to leeward as the lovely lady disappeared beneath the waves …

… leaving me in the strangest condition imaginable, with the boat wandering off course, my jaw hanging down to my umbilicus, a pulse rate well into the triple digits, adrenalin-shocked, awed beyond words, smelling like the dumpster behind a cheap fish restaurant, blasted by the natural beauty I had just witnessed, and uncertain whether I was going to vomit or not, but tending toward the former.

I’m not jonesing to visit that particular emotional place again, once was enough for any man. And on a cold night like tonight, I’m glad I’m not rolling out at four am. I fished the Bering Sea as well, and these days I’m just as happy to see the bergy bits and watch the Bering ice on the “Deadliest Catch” TV show from the safety of my couch  … but ah, dear friends, mostly I’ve just moved my ocean madness to warmer waters, and I wouldn’t have missed it for rubies and pearls …

Sports and gallantries, the stage, the arts, the antics of dancers,

The exuberant voices of music,

Have charm for children but lack nobility; it is bitter earnestness

That makes beauty; the mind

Knows, grown adult.

A sudden fog-drift muffled the ocean,

A throbbing of engines moved in it,

At length, a stone’s throw out, between the rocks and the vapor,

One by one moved shadows

Out of the mystery, shadows, fishing-boats, trailing each other

Following the cliff for guidance,

Holding a difficult path between the peril of the sea-fog

And the foam on the shore granite.

One by one, trailing their leader, six crept by me,

Out of the vapor and into it,

The throb of their engines subdued by the fog, patient and

cautious,

Coasting all round the peninsula

Back to the buoys in Monterey harbor. A flight of pelicans

Is nothing lovelier to look at;

The flight of the planets is nothing nobler; all the arts lose virtue

Against the essential reality

Of creatures going about their business among the equally

Earnest elements of nature.

Robinson Jeffers saw it … when you read those lists of famous last words, nobody ever says “I wish I’d spent more time at the office”. Don’t mail the envelope in, push the envelope, the journey will end long before any of us wish it to. Live your most impossiblessed dreams, my friends, because any other kind is just a dream. Chance the widdershins steps of the tarantella, lift the ancient curses and look under them for old coins and lost loves and dust bunnies with a vest and a gold pocketwatch, opt for an immediate increase in the uncertainty levels, stay away from the world of adrenalin deficit spending, hold your dearest warm under your heart while you dare the icy seas of life, for the night is assuredly coming …

My very best wishes to all, I’m off to sleep.

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Editor
February 2, 2013 4:53 pm

This is a wierd post. Chief stirrer Willis, while delightfully eloquent as always, is chucking in a few straw men and red herrings to make his point : Peak Oil is a “terrible story”, oil is “running out”, peak oil folks think Hubbert was totally correct, “Peak Oil” relies on “unconventional” oil being different to “conventional” oil, huge/massive amounts of coal, gas and methane hydrates prove we’re not at peak oil, etc.
Peak Oil means Peak Oil. That is, the point at which annual oil production, for whatever reason, ceases to increase. When you get to Peak Oil, you haven’t run out of oil. You still have lots of oil. All it means is that you can’t or won’t produce oil at a faster rate than before.
If energy demand keeps increasing – and I certainly hope that in the free world at least it does – and if oil gets more costly and/or difficult to produce (which it is), then other forms of energy will become more competitive. If lots of energy is available from other sources (which it is) then increasing energy demand will at some point all be satisfied from energy sources other than oil. If the changes are smooth, it’s a non-event. But it’s still Peak Oil.
IMHO, we have reached or are about to reach that point. Have we run out of oil? No. Are we on the brink of disaster? No. The USA hit its own Peak Oil in 1970, one of the two dates predicted by Hubbert. Now Hubbert seriously underestimated the amount of oil that would be found in the US, he seriously overestimated the rate of decline following the peak, but by luck or judgement he got the date right. Did the US run out of oil? No. Was it a disaster? No. What happened was that the US satisfied its rising energy demands from other sources. Those other sources, then, included non-US oil. But it was still the US’s Peak Oil.
OK, maybe it isn’t the US’s Peak Oil yet. Maybe all the new oil finds will allow US oil production to exceed the 1970 figure. To do that, US annual oil production has to rise 44% from the 2011 level. You see, even though Hubbert got his supply figures badly wrong, US annual oil production has fallen quite a long way since 1970. Will it go up 45% and stay up there for a few years? Maybe, but I wouldn’t bet on it. My guess is that to achieve that figure the oil price would have to rise so that the increased oil production is economic, and it would have to fall so that oil remains competitive with alternatives.
I would be happy to be proved wrong, but it looks to me like 1970 was the US’s Peak Oil, and the world’s Peak Oil might not be all that far away.

View from the Solent
February 2, 2013 4:57 pm

Willis,
It is rare to find a practising scientist who is proficient, let alone poetic, in their expression. Perhaps it is a function of age. But then I am an old curmudgeon become mathist who was fortunate to have been educated (in England) when my science subject teachers would criticise the writing as well as the technical content of my work. Reading your articles is always a joy. Thank you.
Back to the subject in hand. I only properly understood the fallacy of peak [insert current doom here] when I read http://remittanceman.blogspot.co.uk/2008/02/mineral-reserves-and-resources-what.html?zx=d5d0af80de1f9e64 (ignore scary warning). Written by a horny-handed* mining engineer. Simple and easy to understand. I’ve yet to see a better description.
* I hope this doesn’t mis-translate in Amerenglish. On the right side of the water there is an expression ‘horny-handed son of the soil’, meaning someone whose hands are hardened and calloused from a lifetime of working the land. I believe that horny might be misinterpreted beyond ~70 degreesW

Bob
February 2, 2013 4:58 pm

Willis, Hemingway I say. Only better.

E.M.Smith
Editor
February 2, 2013 4:59 pm

@TimTheToolMan:
It isn’t a ‘peak’ until the production curve is lower on the right side than to the left. So far the right side is still higher.
BTW, whenever that day comes, there are a dozen good ways to make “oil products” without oil. Rentech RTK is doing it today commercially as is Sasol in South Africa. Sasol is using coal, but Rentech is using trash. I don’t think we are in danger of running out of trash any time soon.
One could also use wood ( we can produce it at about 25 dry ton / acre – Eucalyptus in Florida have done that as IIRC has Hybrid Poplar) and other carbon sinks; but first we have to use up Old Trash Mountain….
Even if we had declining production of oil starting today, there would not be a crisis. We would just need to start building synfuels plants.
Those are not the only two companies, BTW, there’s a dozen or so others. Just waiting for the day oil prices stay high for a while. ( The real problem is that OPEC crashes price and puts folks out of business whenever someone starts producing in quantity. You will know “peak oil” really arrived when they can no longer do that and synthetic oil is a growing commodity.)

February 2, 2013 5:01 pm

Willis writes “Tim, are you seriously looking at that chart and claiming that oil production peaked in 2004 like Ed_B claims?”
No. I’m saying production has levelled out. Especially when you take continued growth, especially in the East into account. The actual peak obviously wasn’t 2004. Why would you suggest I would think that? Are you making another strawman argument from another poster’s comment and applying it to my post?

cd
February 2, 2013 5:02 pm

TimTheToolMan
Peak oil is not about and has never been about reserves or technology. Its about peak production and so if you look at the larger picture, the 60s and 70s saw massive growth in the West supported by huge increases in oil usage….The last 20 years has seen massive growth in the East unsupported by the same oil production increases. And what has happened?
Production is determined by price and demand as well as capacity (both upstream and downstream). OPEC have a duty to themselves and their customers. They cannot change capacity Willy-Nilly else they destabilise their own economies. Therefore, there will be times that demand exceeds output, while others when demand does not. This is reflected in the oil price and there’s typically a lag between both when prices generally plateau. Remember prior to the 1970s crisis the West basically determined capacity. Post 1970 that changed. So it is hardly surprising that OPEC acts in self-interest if they don’t up supply they can cause a global recession (demand drops and they lose trade) they increase supply to quickly they do themselves out of pocket. They play balancing game. Essentially your point is wrong.

Doug
February 2, 2013 5:04 pm

E.M.Smith says:
“IMHO oil comes from two places. Fermented algae (such as North Sea oil deposits) and subjection / collision of plates (such as California / Saudi). Otherwise California oil doesn’t make much sense. Much of California was only lifted out of the sea recently in geologic terms. It was ‘ocean bottom scrapings’ and not a lot of time for sediment trapping and kerogen breakdown…”
===================================================================
I knew it would not take long for the abiotic crowd to clog up this fine post. All this horizontal fractured shale is proving once more that oil comes from organic rich source rocks. If California oil makes no sense to you you might google “source rocks California”, and start by reading this:
http://pubs.usgs.gov/pp/pp1713/11/pp1713_ch11.pdf
The Monterey has long been recognized as a rich source rock, and a fair bit of work is going into producing directly from it.
http://www.aapg.org/explorer/2012/11nov/monterey1112.cfm

William Astley
February 2, 2013 5:05 pm

Conventional wisdom is scientifically incorrect. I have researched this subject in depth and can continue to provide additional information and logic, until ever one acknowledges conventional wisdom is incorrect. For example I found, a very interesting set of papers published in the 1970’s by the API (American Petroleum Institute) on the formation of oil. (A better title of the collection of papers would be “the unexplained problems with the conventional formation of oil from plants and marine animals”, rather than “the formation of oil”). An example of the unanswered problems in the collection is how to explain the finding of massive oil reserves at the continental shelf. What is the source of the hydrocarbons? Marine environments are very efficient. There is very little plant or animal residue that is deposited on the ocean’s surface. A second primary issue is pressure does not convert long chain plant or animal hydrocarbons to short chain light oil molecules.
The solution proposed in the API paper has the word “time” in quotations, however chemical reactions from a lower to a higher state do not proceed as water does not flow uphill regardless of the amount of time that passes. A chemical reaction that does not take place is at the conditions where the oil is found is a show stopper for the biological source hypothesis.
A third is why are there heavy elements in the oil? Think of the competing hypothesis for the formation of oil where the hydrocarbon comes from deep in the earth and hence picks up the sulfur and heavy metals as it migrates through the crust. The deep earth hypothesis and migrations explains why unconnected oil fields across vast geological regions have similar amounts of heavy metals and sulfur.
Raise the question to a higher level. What is source of hydrocarbons on this planet’s surface? Roughly 70% of the earth’s surface is covered by water. Where and when did that water come from? As almost no one is aware the solar wind strips water from the atmosphere. If there was no new source of hydrogen this planet would be dry and lifeless.
There are a number of commercial changes concerning the amount of oil and gas in recent years.
For those who have not noticed, for example, Canada is now constructing a LNG (Liquefied natural gas) export terminal at its West Coast to export natural gas. A few years ago Canada was planning to construct a port at the same location on its West coast to import LNG. What has changed? The discovery of massive reserves of deep earth CH4. North America suddenly has a massive surplus of “natural gas”. Why? Russian natural gas reserves are now the largest in the world. Why? The Russians have perfected deep earth drillin techniques. Why? What is the standard theory for the formation of “natural gas” CH4 and oil in Russia and the old east block countries?
Saudi Arabia has 25% of the planet’s oil reserves half of which is contained in only eight fields. Half of Saudi Arabia production comes from a single field the Ghawar. Again why?
As most are aware a large mars sized object struck the earth roughly 500 million years after the formation of the solar system. The impact formed the moon and stripped the planet’s mantel of most of the volatile lighter elements. As 70% of the planet’s surface is covered by water a natural question to ask is: Where did the water come from, as the earth’s mantle contains almost no water or hydro carbon?
There are two theories to explain how water and hydrocarbons came onto the earth: the late veneer theory and the deep CH4 theory. The late veneer theory hypothesis: Comets struck the early earth after the big splat event covering the very hot earth with hydrocarbons. The late veneer hypothesis requires that the earth had a Venus like atmosphere (atmospheric pressure of say 60 atmospheres) for the early earth, except with methane.
There are multiple problems with that hypothesis (See Thomas Gold’s Book Deep Hot Biosphere for details. One of the key problems is the observation that the percentage of heavy gaseous elements in the earth’s current atmosphere does not match that of comets (Comets are residues of the early solar systems. The comet elemental composition does match that of the sun). The late veneer theory’s explanation for the miss match of isotopes in the earth’s atmosphere to that of comets is that the early solar system had a close encounter with another solar system which temporary provided a limited source of comets to cover the earth but not significantly change the element composition of the sun.
The second hypothesis is the deep earth hydrocarbon theory. This theory hypothesizes that massive amounts of hydrocarbons (5% of the total core mass) are located in the earth’s core. As the core cools these hydrocarbon (CH4) are released. At very high pressures the CH4 forms longer chain molecules.
The release of CH4 is still occurring as the upper surface of the ocean is saturated with CH4 which indicates that CH4 is being released from some source.
See Carnegie Institute of Sciences Deep Carbon Workshop presentations if you interested in this subject.
https://www.gl.ciw.edu/workshops/sloan_deep_carbon_workshop_may_2008
and…
http://www.sciencedaily.com/releases/2009/09/090910084259.htm
http://www.nature.com/ngeo/journal/v2/n8/abs/ngeo591.html

johanna
February 2, 2013 5:09 pm

Those who seek to justify the peak oil meme in terms of rising oil prices are missing the point. Firstly, the real cost of oil on world markets has not risen in the same way as US prices have. The steady weakening of the purchasing power of the $US over a long period has made imported oil more expensive for Americans, but less expensive for some other countries. Further, changes in the world oil price have little to do with availability, and a great deal to do with political instability in all sorts of places – the Middle East, Venezuela and Iran/Iraq for example.
For an excellent potted history of world oil prices and their effect on the US, see:
http://www.wtrg.com/prices.htm
As the article points out, US oil exploration for anything but the easiest fields was discouraged until 1971, when domestic price controls were lifted. Previously, US companies had to supply the domestic market at below world prices. It was unlucky timing for the oil industry too – just as they gained incentives to look beyond the easiest pickings, the environmental movement took off.
Another consideration is that we in the West are far wealthier than people were in the days of very cheap oil, and drive much more fuel efficient cars. So, even though the graphs of rising prices look dramatic, most people can afford the same or a better lifestyle without making sacrifices. Indeed, not only are our cars more efficient, they have dozens of features which only limousines might have had 50 years ago, if they existed at all. Nor is there any evidence that rises in the cost of petrochemicals have had any appreciable impact on us, for similar reasons.
As others have pointed out, peak oil is a chimera designed to scare us into subsidising certain people’s pet projects, and is in any event irrelevant as the planet is awash with other kinds of hydrocarbons.
Oh, and nice Kipling reference, Willis.

February 2, 2013 5:11 pm

I sometimes wonder if a certain crowd of Big-and-Powerful people planned on “Peak Oil” happening, thinking it was a reality, and decided to use up the rest of the world’s oil first, thus eventually putting the USA in a position of great power, “The One Nation With Oil Left.” In order to achieve this end they needed to manipulate data and make it unprofitable to produce domestic oil. Now, after all that work, they are very old (or dead,) and discover the Peak Oil premise was incorrect in the first place. Oops.
An interesting tidbit of history to look at is the history of the Suez Crisis in 1956. It was a sort of make-or-break moment for the Brittish Empire, and the USA messed up their plans by stating we wouldn’t export any more oil to England if they didn’t calm down. (We were an exporter at that time.) Yet England’s involvement in the Middle East was all about oil, and energy. (It was originally energy in the form of coal, (and knowing how to use it,) that helped make England a world power in the first place.)
Energy is important to the bigwigs who think they, and not the Power that made and rules the sea, are boss.

Robber
February 2, 2013 5:12 pm

I still remember as a young engineer in the oil industry being told that it was a wonderful industry, “but you know that in 10 years time oil will start to run out”. And every ten years the same story would be repeated! In 1979-1980 the Iran/Iraq conflict led to an oil price shock with prices hitting more than $50/barrel with plenty of predictions that by the mid 80’s oil would be over $100/barrel. Instead it dropped back to around $10/barrel. “Prediction is difficult, especially about the future” (Niels Bohr).

Peter Crawford
February 2, 2013 5:13 pm

I must go down to the sea again
To the lonely sea and the sky
I left some socks and panties there
I wonder if they’re dry.
William Shakespeare (or maybe not).

February 2, 2013 5:22 pm

cd writes “if they don’t up supply they can cause a global recession (demand drops and they lose trade) they increase supply to quickly they do themselves out of pocket.”
Perhaps you haven’t been keeping up with current events because we’ve just gone (going) through a global recession and they haven’t increased supply to decrease prices to help get the economies back into gear and consequently sell more oil and increase profits.
You make it sound like OPEC is willingly letting the world economies wither with the high prices they’re setting for their own benefit. Thats a pretty negative view of them.
A much simpler view and one supported by peak oil theory is that their ability to increase production has diminished and the market forces have driven the prices up. That and the fact that non-conventional oil is simply more expensive to produce.

February 2, 2013 5:23 pm

William H says:
February 2, 2013 at 3:33 pm
” A $20 barrel of oil in 1970, using normal inflation figures, is equivalent to approx $125 today. Brent is currently at $116, so even ‘peak cheap oil’ is not a reality, never mind peak oil.”
Look at the following link :
http://inflationdata.com/inflation/Inflation_Rate/Historical_Oil_Prices_Chart.asp
The prices of the 70’s were an anomaly driven by politics (you might recall the Middle East Oil embargoes; yet another variable not contemplated by Hubbert). Other than than that, inflation adjusted oil hovered in the $20-30/bbl range from the 40’s to the end of the 90s – for over 50 years. These were Hubbert’s years, but not out years – our real price now is much more expensive than than that 50 year period. And that is the economic incentive that was needed to move off & “re-set ” the curve. I’ll stick with my original premise that Hubbert implicitly assumed constant prices & technology, which was basically true during his time, but not true for our time, thus the theory fails today.

February 2, 2013 5:29 pm

Willis wrote “We have produced more oil than we did in 2004 every single year since then except 2009”
In response to my post which said “We may not be precisely at peak oil and we may even flatline or even slightly increase for a while but we’re not going to get large increases like we did in the 60s and 70s and instead we’re going to be doing all we can to keep our heads above water as the conventional sources continue to slow their production rates.”
I’m beginning to see a pattern with Willis’ replies. He doesn’t even read the post he’s replying to.

February 2, 2013 5:34 pm

greymouser70 says:
February 2, 2013 at 4:53 pm
“Willis: I realize you are probably using the terms “conventional oil” and “unconventional oil” facetiously but to a geologist those terms have very specific meanings.”
This is an important point for the non-geoscientist to understand.
Peak Oil alarmists DID NOT invent these terms – conventional & unconventional – they stole & politicized these terms from geoscientists & engineers who were trying to describe what they were doing – for the benefit of management, investors, etc. You have understand that the very rocks we are now considering to be reservoirs used to be considered seal rock – and completely unproductive …. and un-economic :)) A new vocabulary had to be developed so decision makers could understand what their technical teams were proposing to do, thus the terms conventional & unconventional.

E.M.Smith
Editor
February 2, 2013 5:36 pm

:
Gee… Didn’t know I constituted a “crowd”.
As per “clogging”: There is much evidence for SOME abiotic oil. Please note I am not saying ALL oil. As pretty much every primitive body in the solar system as “abiotic oil” on it, I find it completely untenable that the Earth would be the only exception.
So yes, I think there is abiotic oil. I also know there is biotic oil. BOTH exist. Arguing over how much of each might be interesting. Listening to someone snap their mind tight shut and toss invective is far less so.
As talking with folks who are mind-blind and mind-deaf is hard, I’ll not bother pointing out the various things wrong with the biotic theory of oil origination for ALL oil. (And there are many loose ends…) But I would suggest just looking at some places where oil is found, yet can hardly be explained by biological traps.
Then there is that well in the Gulf of Mexico that keep refilling from further down, and with oil with far fewer biological markers…
Oh, and do tell where the oil on Triton comes from?
http://chiefio.wordpress.com/2012/03/25/did-crude-oil-rain-from-the-sky/

http://en.wikipedia.org/wiki/Tholin
Tholin [after the ancient Greek word θολός (tholós) meaning “not clear”] is a heteropolymer molecule formed by solar ultraviolet irradiation of simple organic compounds such as methane or ethane. Tholins do not form naturally on modern-day Earth, but are found in great abundance on the surface of icy bodies in the outer solar system. They usually have a reddish-brown appearance.
Tholins have also been detected in the stellar system of an eight-million-year-old star known as HR 4796A using the Near-Infrared Camera and Multi-Object Spectrometer (NICMOS) aboard the Hubble Space Telescope. HR 4796A is 220 light years from Earth.
“Triton tholin” and “Titan tholin” are nitrogen-rich organic substances produced by the irradiation of gaseous mixtures of nitrogen and methane such as that found in those moons’ atmospheres; Triton’s atmosphere is 99.9% nitrogen and 0.1% methane and Titan’s atmosphere is 98.4% nitrogen and the remaining 1.6% composed of methane and trace amounts of other gases. These atmospherically derived substances are distinct from “ice tholin”, which is formed by irradiation of clathrates of water and organic compounds such as methane or ethane. The plutino Ixion is also high in this compound.

Since our oxygen rich air is relatively new in geological terms, we had a very long time with a reducing atmosphere where just such things ought to have happened.
And loads of carbonate rich wet suducting goo to cook into hydrocarbons too.
Somehow all the Peak Oilers seem to think carbon chemistry stopped with the advent of life.

johanna
February 2, 2013 5:39 pm

Peter Crawford, close, but no cigar.
I must go down to the sea again
To the lonely sea and the sky
I left my vest and socks there;
I wonder if they’re dry?
– Spike Milligan
He hated Masefield’s poem, which every schoolchild of his generation had to learn by heart.

Gary Murphy
February 2, 2013 5:39 pm

willis, thank you! Your sailing experiences reminded me of ” Vagabond House” by Don Blanding. Hope you have read it.

MarkG
February 2, 2013 5:40 pm

The odd thing is, I’ve often found that the most ardent ‘peak oilers’ on the web forums I frequent are also ardent ‘global warmers’ and can’t even see the inconsistency in those positions. I guess they just get bored if they don’t have imminent disaster to worry about.

February 2, 2013 5:46 pm

E.M Smith writes “It isn’t a ‘peak’ until the production curve is lower on the right side than to the left. So far the right side is still higher.”
I have never said we’re at peak although we might be getting close. Certainly the data supports that hypothesis with the recent flattening of production in spite of continued growth in the East. The Hubbert curve has a slowing before the actual peak. That slowing will have its own set of impacts and will involve rising prices.
At the end of the day I’d love to be wrong and will be more than happy if production can be maintained and increased and the price at the pump remains affordable.

Paul Watkinson
February 2, 2013 5:54 pm

Willis, great post as usual thanks.
Unimportant typo where you ask the question “so why isn’t their unconventional coal?”. Should read “so why isn’t there unconventional coal?”
Regards Paul Watkinson.
[Thanks, fixed, perfect is good enough … -w.]