World oil supplies are set to run out faster than expected, warn scientists

[Ali G. 37]

LPG is also a fossil fuel, with a limited supply.

Public transportation is fine for dense, centralized areas, but it is hardly the be all and end all solution for everywhere else.

How about CNG then? Which can actually be created using a range of bacteria and techniques, not to mention collecting gas from trash.

Centralized metro areas is the way the world has been heading for a long time. The youngest countries like Canada and Australia are living proof of this. The sole reason the US was able to defy this is because of traditionally cheap gas, allowing for the exurbs to be affordable to commute from; basically white flight was affordable.

You also have to keep in mind that gone are the days when you would setup a plant in a remote area or small city. Nowadays, in the information age, jobs are located in research centers situated around major metro areas. Blue collars industries are established around these cities in order to support them.

Edited February 23, 2010 by Booyah

[peejay 327]

World oil supplies are set to run out faster than expected, warn scientists

Gee...just about a month ago I read that supplies were endless.

Shifting demand suggests a future of endless oil

Technology, politics and consumer behavior could keep industry pumping

By Stanley Reed

Business Week

updated 6:51 a.m. CT, Tues., Jan. 12, 2010

Not many people think of the Netherlands as oil country, but a billion-barrel field lies under a nine-mile strip of grazing land along the Dutch-German border. When oil prices cratered in the 1990s, Royal Dutch Shell and ExxonMobil shut the Schoonebeek field down. Company executives reckoned that its thick, hard-to-extract crude wasn't worth the trouble, even though only about 25 percent of Schoonebeek's oil had been produced. The main evidence of the town's petroleum past was an old-fashioned bobbing oil pump, known as a nodding donkey, which still stands in a parking lot near a bakery.

Now higher prices and technological advances are spurring a new joint venture of Shell, Exxon, and the Dutch government to pump Schoonebeek's reserves once more. New wells drilled horizontally are coming in contact with more of the oil. Steam injected into the rock loosens up its molasses-like crude so it can be brought to the surface more easily. Shell won't say what price it needs to make such efforts profitable, but experts estimate $40 to $50 per barrel will do. At a current price of $80, the field is a clear winner. "We wouldn't do this if the price was really low," says Michael Lander, the Shell executive running the project. The venture is expected to produce 120 million barrels from the reopened western section of Schoonebeek over 20 years. If another section of the field is developed, the recovery rate — the share of oil that gets pumped out — would approach 50 percent. The industry average is 30 percent to 35 percent.

Pressure to innovate

Schoonebeek will not flood the world with crude. But its success presents a stiff challenge to those who argue that oil production is in irreversible decline. Consumer demand, technology, and global politics are shifting in a way that could spell a future of oil abundance, not of catastrophic dearth. As Leonardo Maugeri, a senior executive at Italian oil major ENI, puts it: "There will be enough oil for at least 100 years."

Many analysts and industry executives have little doubt that there's plenty of oil in the ground. "Only about 32 percent of the oil [in reserves] is produced," says Val Brock, Shell's head of business development for enhanced oil recovery. Shell estimates 300 billion barrels and maybe more might be squeezed out of existing fields, much of it once thought beyond retrieval. Peter Jackson, IHS Cambridge Energy Research Associates' London-based senior director for oil industry activity, has reviewed data from the world's biggest fields. His conclusion: 60 percent of their reserves remain available.

The fact that there's still oil for the taking is driving Shell and other majors to come up with new technologies, which are expensive to develop but worth it when crude is riding high. While the price has fallen considerably from the peak of $147 per barrel in 2008, it is still far above what many oilmen expected a few years ago. "You will see companies going into the deep water, going into the arctic, using the best technology," says Maugeri, who sees the oil industry as a dynamic system that responds rapidly to changes in the economic and political environment.

Even if the new technologies add just a few percentage points to the recovery rate, such gains add years to global supply and boost the industry's profits. So the technology of coaxing oil out of the ground is constantly improving. Heating up heavy oil, as at Schoonebeek, is one new trick. Companies can add heavy polymers to the water they blast into a production site to push more oil out; the polymers add weight to the water and increase the pressure on deposits. (Shell is trying such technology on the Marmul field in Oman.) Another tactic is to inject soap into the ground to break the surface tension that makes leftover oil cling to the rock.

Simple methods can help mature oil fields produce more and even uncover bigger reserves than imagined. A study of fields in Indonesia by IHS CERA found that it wasn't uncommon for them to produce more than double initial estimates. Petroleum engineers help the fields live longer just by drilling new wells or installing better pumps. "As a field ages, the operators learn more ... that allows them to tweak their operations," explains Leta K. Smith, a Houston-based analyst for IHS CERA.

Sharp falls in production can be arrested. Output at Samotlor, Russia's largest field, was plummeting in the late 1990s. The field's owner, TNK-BP, formed in 2003, has since managed to boost production by a third. Adjusting the placement of the pumps in the wells yielded big gains, while three-dimensional seismic technology gave a better glimpse of the oil-bearing structures under the ground.

Iraq's wild card

Pumping the oil that's already discovered isn't the whole story. Explorers, sometimes financed by hedge funds and private equity firms, are finding troves in the deep water off Brazil, West Africa, and even the U.S. At the same time, old and new oil powers — Russia, Brazil, Angola, Nigeria, and Kazakhstan — are ramping up their capacity with the aid of Total, ExxonMobil, BP, and other majors. These projects could eventually add 5 million barrels to global daily output.

The most surprising action is unfolding in Iraq, which has just cut deals with ExxonMobil, BP, and Shell as well as with Chinese and Russian companies. If all these ventures meet their targets, Iraq could produce as much as 12 million barrels a day, putting it in the super league with Saudi Arabia and Russia. Given the political and logistical obstacles Iraq faces, that seems unrealistic anytime soon. But 6 million barrels a day seems attainable within 10 to 15 years. That level would turn Iraq into OPEC's No. 2 producer after Saudi Arabia.

Moderating global demand can also stretch the supply of crude. After the oil shocks of the 1970s, efficiency gains and a switch by factories to natural gas prompted a nearly 10 percent drop in global oil consumption in the early 1980s.

The price spike of 2008 may lead to similar results. Lester Brown, president of the Earth Policy Institute in Washington, an environmental group, notes that the U.S. car fleet shrank by 4 million in 2009, thanks to scrapping and reduced sales. He expects that shrinkage to continue, reducing the U.S. fleet by 25 million cars by 2020. He also sees a cultural change occurring in which more people, especially the young, don't see owning a car as a necessity. "We are now looking at something new, a shift in the way people think about automobiles," he says. "That means less oil use."

U.S. oil consumption dropped by 9 percent over the last two years. The recession certainly hurt demand, but many analysts think oil use in the West has peaked and will not rebound to previous levels. The Energy Dept. sees the consumption of oil-based fuel in the U.S. flattening out in the coming decades. "Are people going to use energy differently in the next [growth] phase?" asks Goran Trapp, head of global oil trading at Morgan Stanley in London. "If so, the people forecasting [strong] demand increases are going to be surprised."

China is one key to answering Trapp's question. Even as the mainland devours oil and coal, the government is pursuing a green agenda. China has the world's top solar panel industry, a power plant in Beijing is one of the world's most efficient, and auto emission standards there are now tougher than those in the U.S. China's official policy mandates that alternate sources support 15 percent of the country's energy needs by 2020, up from 9 percent now. So China's petroleum consumption will keep increasing, but perhaps at not so steep a rate as expected. A nasty oil shock is always possible. But the case for bountiful oil is strong.

http://www.msnbc.msn.com/id/34770285/ns/bu...-oil_and_energy

[Tinkerbell TX 0]

funny how 40 years ago they were also predicting that we'd run out of oil by about 2000. Hasn't happened and, as a matter of fact, new fields continue to be discovered. imagine that! There's the new Tiber Field in the Gulf of Mexico and the big one down offshore brazil.

[Peikko 1,575]

Read the article, no one is saying new fields are not found, what they are saying is that world consumption is nearly at the point of outstripping supply of the readily extractable (read cheaply) crude. Of course, bury your head in the extracted oil field shale all you want.

Edited February 23, 2010 by Madame Cleo

[Peikko 1,575]

NM.

Edited February 23, 2010 by Madame Cleo

[Gary and Alla 3,694]

Good news. The middle east will be back to their natural position of worthlessness and not have control over the rest of the world and there will be a great incentive for alternative energy sources ending our need to subsidize them. The new source will undoubtedly cut carbin emiisions, which will have no practical benefit at all but will make liberals happy. Oops, no, sorry. Liberals LIKE, ney LOVE global warming, they get very upset at the thought it may not exist! (you would think they would be happy! )

This is good news for everyone.

[Gary and Alla 3,694]

Read the article, no one is saying new fields are not found, what they are saying is that world consumption is nearly at the point of outstripping supply of the readily extractable (read cheaply) crude. Of course, bury your head in the extracted oil field shale all you want.

ending the oil supplies is a good thing. I hope it runs out sooner rather than later. I would not have bemoaned the passing of the horse and buggy, why would I bemoan the inevitable passing of oil as the primary fuel source? It wasn't the primary fuel source 100 years ago and it will not be 100 years in the future, with any luck, not even 50 years

[Peikko 1,575]

Do you even marginally understand the concept that Western industry is completely grounded in crude, not simply for cheap and plentiful energy, but also to create plastics, pharmaceuticals and fertilizer? Do you have any idea the effect the loss of cheap crude oil is going to have on the global economy? Do you even grasp that geopolitics will play an ever increasing role in our lives as this transition takes place?

[spookyturtle 9,465]

Do you even marginally understand the concept that Western industry is completely grounded in crude, not simply for cheap and plentiful energy, but also to create plastics, pharmaceuticals and fertilizer? Do you have any idea the effect the loss of cheap crude oil is going to have on the global economy? Do you even grasp that geopolitics will play an ever increasing role in our lives as this transition takes place?

I doubt the paranoia lets him grasp much of reality.

[mawilson 2,133]

Do you even marginally understand the concept that Western industry is completely grounded in crude, not simply for cheap and plentiful energy, but also to create plastics, pharmaceuticals and fertilizer? Do you have any idea the effect the loss of cheap crude oil is going to have on the global economy? Do you even grasp that geopolitics will play an ever increasing role in our lives as this transition takes place?

Well Cleo, we're not going to run out of oil overnight. As the supply dwindles and the demand grows

or remains the same, this finite resource will become more and more expensive and the market

will react by increasing use of alternative sources of energy.

[spookyturtle 9,465]

Well Cleo, we're not going to run out of oil overnight. As the supply dwindles and the demand grows

or remains the same, this finite resource will become more and more expensive and the market

will react by increasing use of alternative sources of energy.

Hopefully we won't get caught with our pants down on this one, but I can see a not so smooth transition period as this all comes about. China and India are emerging now. What happens to the world economy when they use as much oil as the US? Can they afford oil at $200+? Can we? The next recession could make this one look like prosperous times. We need to plan for this now. Actually, we should have started reducing our foreign oil dependence back in 1973. If we had started then, we would have no worries today.

[Scott & Lai 12]

ending the oil supplies is a good thing. I hope it runs out sooner rather than later. I would not have bemoaned the passing of the horse and buggy, why would I bemoan the inevitable passing of oil as the primary fuel source? It wasn't the primary fuel source 100 years ago and it will not be 100 years in the future, with any luck, not even 50 years

The horse and buggy passed when automobiles were developed to the point that they were the more practical mode of transportation. It wasn't as though horses suddenly became so rare and prohibitively expensive that the horse-powered industries collapsed, requiring people to frantically search for alternatives, meanwhile civilization having fallen into another dark ages. I'd be happy to see us no longer dependant on oil for a number of reasons, but in the meantime, we have no workable alternatives for all the things for which oil is used.

[one...two...tree 2,762]

The horse and buggy passed when automobiles were developed to the point that they were the more practical mode of transportation. It wasn't as though horses suddenly became so rare and prohibitively expensive that the horse-powered industries collapsed, requiring people to frantically search for alternatives, meanwhile civilization having fallen into another dark ages. I'd be happy to see us no longer dependant on oil for a number of reasons, but in the meantime, we have no workable alternatives for all the things for which oil is used.

I'd like to see a gradual weening of it over the next 30 years. I'm confident by then, we'll at least other viable sources. Biofuels show promise but there are pros and cons as well. I don't think there will be a one, single alternative, but rather a myriad of avenues, including big strides in energy conservation.

[Peikko 1,575]

Well Cleo, we're not going to run out of oil overnight. As the supply dwindles and the demand grows

or remains the same, this finite resource will become more and more expensive and the market

will react by increasing use of alternative sources of energy.

No, it will not run out overnight and yes, with proper planning alternative sources of energy will be substituted - however, there is nothing currently under consideration that will be anything like as cheap and plentiful as crude oil, so the contraction will be painful if not managed and if people pretend there is no problem, there will be no proper management.

[Peikko 1,575]

The horse and buggy analogy is ridiculous, the loss of crude oil is not simply about a change in transportation - and horse power wasn't expensive, just labour intensive.