world reserve growth - a key cache that allows PeakOil idea

meemoe_uk · Post by **meemoe_uk** » 27 Jan 2011, 16:20

Right then. While most of you are still struggling with the idea of bluffs in the big market and the media, I thought I'd move onto the 2nd opinion next to RGR's on world oil reserve growth.

How the world economy has worked for the 150 years has defined a key feature in oil reserve estimates.
At no time has it been economic for any group to look for and study new oil reserves when there's already 30 years worth of proven accessible reserves known to exist.

I'll labour the point with a typification, because for every peakoiler it's at the foundation of your beliefs.
You're a small oil company with small capacity for prospecting and extraction. You've got limited funded, loans to repay from banks who want fast returns, and as always there is plenty of competition in your market. Right now there are proven reserves of oil in such-and-such a place. All your competitors are rushing into this area. There will be plenty for you aswell aslong as you get in right now. Then $millions will come flooding in.
Beyound this oil bonanza there are other places around the world where there is some speculative oil prospects, the risks are higher.
If you fall behind your competitors you'll likely be pushed out, then you better pray they buy you out and keep you on the payroll.
What will you do?
Most go for the oil bonanza, a few do some prospecting.

A few decades later. The oil bonanza is drying up. The tech required to get the oil out is getting more expensive. Extractions prices are going up. Since everyone is saying the same story, the banks are willing to give you longer term loans to find new oil fields. Prospecting becomes more economic, but not much. Banks are in competition with other banks, and in that game the fastest returns win. So as ever the game is to do the minimum to find a new oil bonanza and no more.

So just as the 30 years supply seems to be dwindling, every 30 years or so, there's massive upheaval in the oil industry, a shift in location, and then a settling back down. It's a cycle.

Now...

At what point do these banks and oil companys, in fierce competition with each other, stop this game and say...
" hadn't we put aside our petty ways, and look way ahead in oil reserves, say at least 50 years, just to reassure a small minority of the public who are reading too much into the 30 years or so of proven reserves we've got?"
" Yeah, lets give large loans of much longer durations, so our prospectors can really scour the whole planet for all it's oil, and proove ever bit we can as recoverable? "
" No one step out of line with this plan, if you secretly stick to short term gains then you'll end up with all the cash oil and power, and bankrupt all the rest of us! "
" OK! "

They don't. It wont' happen. All you'll get is a few oil peeps independantly visiting your doom site with a few positive facts and figures, which you'll all rubbish and cast off and wishful thinking.

Crucial to the hype, with hubberts exponential consumption curve, peakoilers can always deduce the 30 years or so proven reserves make up the down side of the bell curve, therefore peak oil is round ... about ... NOW! ... always.
So this is the status quo for the last 150 years. If you confine yourself to info within the peakoil community then Peakoil is perpetual looming threat.

That's essentially the peakoil world reserve growth cache 22, upon which the peakoil scare is based, upon which the peakoil scare is perpetually finely balanced.

Now with indivual wells, massive reserve growth is the norm simply because companys have to take the most skeptical view when choosing where to risk their precious capital. They assume all the worst case scenarios for a well when choosing. Of course, enough of time these worst case scenarios don't happen, and the wells are much more productive than the initial very skeptical proven reserves estimates.

The excitment of recent is just the same point in the cycle as
the 70s oil scares.

peakoil is a real geological event. But 'peakoil is always about now' is an
artifact of the economy. Make sure your not kidding yourself that you can distinguish between the two.

What you say RGR and powerswitchers?

PS_RalphW · Post by **PS_RalphW** » 27 Jan 2011, 16:53

The IEA has reported peak conventional oil production in 2006.

I thought it was 2005 myself :/

Reserves are a paper exercise. What is important is how fast we can pump oil or dig or grow 'oil' out of the ground. IEA still claims that tars sands et al will fill the gap between supply and demand, but their forecast future production has been declining sharply year after year for a decade, as they find it harder and harder to overlook reality.

Oil is nearly $100/barrel , yet the only spare oil is OPEC 'spare capacity'. For the last year OPEC routinely has stated "The world is well supplied with oil. We will not increase supply until the price passes $X" . When the price of oil pass $X they say "The world is well supplied with oil. We will not increase supply until the price passes $X + 10".

The US., UK and most of the OECD are being pushed back into recession because we are being outbid for the global supply of oil, which has peaked.

meemoe_uk · Post by **meemoe_uk** » 27 Jan 2011, 17:16

I heard this PO rhetoric 5 years ago.
You really think recycling the same old blumf for the thousandth time on me will impart me new understanding?
Erm. It's a fail. Something in your logic is flawed. But assuming you're a standard POer, you won't have a clue what.

I'd better tell you.
Conventional supply. It's peak has been in the past for over a hundred years. Why? Because convention changes.
It used to be convention to take your wood bucket and fill it up at the local naturally occuring oil seep.
Then it used to be convention to take your pickaxe and wood bucket and fill it up at the local naturally occuring oil seep with a small crevasse dug in a bit.
Then it used to be convention to use a machine to do the digging.
Then the machines got more high tech.
Each tech improvement creates a new convention. The old conventional supply peaks and falls rapidly.

Because of this, POers have had a sturdy straw man 'conventional supply peaked 5 years ago' arguement - for the last hundred years. They wheel it out on a sack cart, and try and scare off or convert naysayers with it.
It doesn't scare me.

By analogy, just cos 'peak apples on tree' conventional supply peaked when little boy picked the one apple he could reach standing on the ground, doesn't mean there aren't hundreds more apples he can reach by using progressively longer ladders.
And no, looking at past conventions and their peaks give no indication of how much more oil there is.

Any more PO fodder arguments you want me to deal with before you snap out of you PO zombie recitement trance and go back and properly read what I've written?

postie · Post by **postie** » 27 Jan 2011, 17:31

meemoe_uk wrote: Any more PO fodder arguments you want me to deal with before you snap out of you PO zombie recitement trance and go back and properly read what I've written?

Yeah, there is a question I'd like answered.

Does anything you write make sense to you? Just wondering, as it sure as hell doesn't to me.

Not that you are quite plainly rude, but the actual words, while looking like they should make sense, don't. Your argument is flawed, in that what you write isn't understandable, not even in the most basic sense. You ramble and throw in random stuff amongst the waffle. Even complicated theories should be explainable.

Please explain it better. You might get somewhere. (somehow though I think you quite enjoy sounding academic while barely being able to have an original thought of your own and with a poor grasp of spelling to boot)

Post by **clv101** » 27 Jan 2011, 17:38

Wow, someone got out of bed the wrong side today. Where's all this vitriol come from?

meemoe_uk · Post by **meemoe_uk** » 27 Jan 2011, 17:46

All that's worth saying to you postie is :-
given your devoid of content, purely adhomien posts are not removed by the moderators is enough evidence to conclude this forum is just another religious hype forum which requires a few witch hunting dogs to snap and heckle at the heels of any naysayers disrupting the procession.

It would not be torelated on any debate forum.

Gotta give them time to act, but afaics there's plenty of such posts that are left as they are by the mods. So until otherwise you know what I think of you and this forum.

postie · Post by **postie** » 27 Jan 2011, 18:11

clv101 wrote:Wow, someone got out of bed the wrong side today. Where's all this vitriol come from?

Do you mean me?

Post by **clv101** » 27 Jan 2011, 18:25

I was referring to the the first post from meemoe_uk.

Seriously folks, this forum operates on the principle of extremely light moderation, that mostly consist of removing spam and sometimes moving posts into more suitable forums. Other than that the forum basically relies on the good nature and manners of the posters for its smooth operation.

Sure we generally leave posts as they are, even when rude, it's not our job to manage poor behaviour. If you would prefer a heavily moderated forum, there are plenty out there.

the mad cyclist · Post by **the mad cyclist** » 27 Jan 2011, 19:01

Come back RGR all is forgiven.

Andy Hunt · Post by **Andy Hunt** » 27 Jan 2011, 19:13

GIGO.

thecoalthief · Post by **thecoalthief** » 27 Jan 2011, 19:34

meemoe_uk wrote:
By analogy, just cos 'peak apples on tree' conventional supply peaked when little boy picked the one apple he could reach standing on the ground, doesn't mean there aren't hundreds more apples he can reach by using progressively longer ladders.

You must be a direct descendant of the chap who cut down the last tree on Easter Island.

the mad cyclist · Post by **the mad cyclist** » 27 Jan 2011, 19:48

meemoe_uk wrote: By analogy, just cos 'peak apples on tree' conventional supply peaked when little boy picked the one apple he could reach standing on the ground, doesn't mean there aren't hundreds more apples he can reach by using progressively longer ladders.

The problem is, he’s not the only one eating the apples now, the rest of his village has started to eating them.

2 As and a B · Post by **2 As and a B** » 27 Jan 2011, 19:53

Buff, buff, and treble buff!

Let me guess memmie. You're poorly educated and can't spell.

Post by **adam2** » 27 Jan 2011, 19:57

thecoalthief wrote:
meemoe_uk wrote:
By analogy, just cos 'peak apples on tree' conventional supply peaked when little boy picked the one apple he could reach standing on the ground, doesn't mean there aren't hundreds more apples he can reach by using progressively longer ladders.
You must be a direct descendant of the chap who cut down the last tree on Easter Island.

I thought that the whole point was that the chap who cut down the last tree on Easter Island, has no descendants !

More seriously, of course technology advances, resulting in previously unknown oil being being found, and previously uneconomic oil becoming profitable. But that does not alter the fact that total oil production has either peaked or very soon will do.
And oil production PER HEAD peaked decades ago.
And oil DISCOVERIES peaked even longer ago.

More oil no doubt remains to be discovered, but at higher and higher prices, in both money and energy.

eatyourveg · Post by **eatyourveg** » 27 Jan 2011, 20:02

Meemoe, you are an intellectual spastic. My cat makes more sense than you. The goats are way brighter, and the horses, well, they are just happy to fart in your general direction.

Now, you can flounce off feeling satisfied that you were right, Powerswitch forum members just don't understand you. You irritating little tick.