Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Posted: Wed Oct 13, 2004 8:15 pm Post subject: Oil Shales
Interesting debate. The last operating oil shale plant in the world was in Australia and it shut down several months ago.
I myself plan to invest in oil company stock, but I do not plan to invest in oil shales. Oil shales will be a huge resource when somebody figures out how to extract the oil without using more energy than you gain. There are millions of acres of cheap oil shale leases just sitting idle in the American west. I encourage somebody to go and figure out how to make money at it and give America energy independence.
To extract the oil you have to dig up the shale, haul it to a proccessing plant, pulverize the rock (the shale), heat it up to about 900 deg. F. an add certain elements including hydrogen if I remember right. Also this proccess uses lots of expensive water (you will have to buy water rights).
Remember also that you are buying oil and natural gas on the open market to run your oil shale plant. Hopefully you will get more than 1 barrel of oil for every barrel of oil used and hopefully the environmental crowd will leave you alone.
You have raised some important points. Let me try to answer one of them.
Canadian Tar Sands
Based on my research, cost of extraction of Tar Sands is approximately USD15/bbl. In order to earn an attractive return on their investments, investors would be willing to invest only if they are convinced that the long term oil price is trading above USD20/bbl (which might not be such a big problem at the moment).
However, Tar Sands have 1 major drawback - ease of extraction. Approximately CAN60 billion have been invested/will be invested from now till 2012. The total production expected from these investments is a mere 1.2 mmbbl/d (million barrels per day). The gestation period for a major Tar Sands project (250 000 bbl/day) is at least 6 years at a cost of close to CAN10 billion.
Next, if we are aware that say Peak Oil is say in 2005, would we be able to identify it in 2005? Probably not. In the world of fudged reserves, it is more likely that the earliest time possible for enough people to get their act together is 2007. If we somehow managed to raise another CAN60 billion, overcome the labour shortage to get 6 major projects online within 3 years, we would have managed to squeeze out an additional supply of 1.5 mmbbl/d (very optimistic scenario).
Meanwhile, we would have lost 5 years. In those 5 years, assuming depletion is at the rate of 2.0 mmbbl/d, we would still be 8.5 mmbbl/d short.
So far, I am not aware of any commercial extraction of shale oil. I understand that Exxon's official position is that it is not economically feasible at the present moment.
P.S. Personally, I do not think a die off scenario is the most likely one. However, I believe that the world would be to undergo a severe adjustment period of 5-10 years
Joined: Aug 10, 2004 Posts: 1104 Location: San Diego, CA, USA
Posted: Wed Oct 13, 2004 10:01 pm Post subject:
I'll make it simple:
1. Shale Oil is, first and foremost, not oil, it is kerogen. In addition, it has never proved possible to extract oil at any large scale from shale oil. Every attempt has been a failure. The process is likely energy negative. It's not an answer.
2. Your numbers for nuclear material are completely wrong. Maybe 100 years at current use (probably less), but much fewer years if we gear up. Breeder reactors aren't viable right now.
In order to earn an attractive return on their investments, investors would be willing to invest only if they are convinced that the long term oil price is trading above USD20/bbl (which might not be such a big problem at the moment).
It is a big problem. A significant cost of the extraction goes to energy. Vast amounts of natural gas are required and those huge excavators and dump trucks run on oil. If the long term price of oil is $30 dollars, then the extraction costs also rise. Costs chase the oil price up the ladder. And this oil isn't light sweet crude being produced.
I think the tar sands will end up being a classic example of a poor energy return. Even if it turns a profit, it may not be as large a profit as could be made using the natural gas for other things and the water for agriculture.
The size of the project is staggering to produce a relative piddling amount of very low quality bitumen. They are targeted to double production in the next ten years, but it is all very iffy. The project would never have begun without large subsidies.
And the costs go up as you have to go deeper ansd deeper to dig it out.
You can also find sensitivity analysis inside, i.e. what happens should oil prices appreciates and so on. You should also note that they plan to produce synthetic light sweet crude.
Meanwhile, Suncor (SU) which is producing synthetic crude oil at approximately 225,000 bbl/day is definitely profitable.
As pointed out above, production FBRs exist in Japan and in India and China. FBRs feature strongly in Japan's energy strategy. Their main drawback at present is that cheap supplies of uranium make FBRs less competitive vs PWRs.
Back up your opinions with figures, sources etc, rather than saying my figures re: nuclear energy are wrong. (You might also want to do some research first).
Theoretically, this process appears to work. However, its actual industrial application is largely unproven and might need quite some time before it become proven, if at all. In my opinion, if the process really holds much promise, the Tar Sands companies would be beating a path to them!
There was no actual mention on the speed of extraction but it is probably implied that a large scale project will kick off much quickly than conventional oil sands extraction.
If you observe ASPO depletion curve, you would realise that heavy oils such as tar sands is factored into computation, with increasingly higher contribution post peak. Due to the drawback (ease of extraction) mentioned, it would be years before significant production amounts can make a difference.
Sure we use a lot of oil (too much?), and if we changed our ways (as is starting to happen) we could use less, and extract more, and utilise what we have better. Why does this mean that peak oil is definately here now? Where's that proof of that? At what price is oil too expensive to extract? Peak oil is based (to my understanding) on the premise that it will become too expensive to extract enough oil to meet demand - what is that price? is it $52pb, $60pb, $100pb??? We've seen price increases of 25% this year, but no economic collapse...
Your understanding is wrong. Peak-oil is based upon the premise that world oil production will soon peak and then decline every year thereafter, no matter what technology we use in attempts to increase it, or at what price a barrel of oil rises to. We simply won't be able to meet demand at any price. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Joined: Jul 21, 2004 Posts: 1328 Location: Suburban tar sands
Posted: Thu Oct 14, 2004 11:19 pm Post subject: Re: Peak Oil - Important points, but wrong!
Scientist wrote:
The Peak Oil discussion is an important debate, but you should check the figures out there folks. Let me just quote you some:
- At $40pb shale oil can supply oil for the next 250+ years at current consumption rates. We are obviously at $50+bp this week.
- The total size of known shale oil resources represents 5000 years of reserves at present consumption!
- Aside from shale oil, there are other huge untapped energy resources such as deep water oil that have SO FAR been uneconomic to exploit
Peak Oil is about the end of cheap conventional oil.
The Uppsala Hydrocarbon Depletion Study Group graph:
http://peakoil.net/uhdsg/Default.htm
already includes estimates of Heavy, Deepwater and Polar.
The third graph on page 6 of
http://www.peakoil.net/Publications/20040201ExxonMobil.pdf
is similar except it shows a rising curve to 2015.
Note that enhanced recovery is already included in the area marked "Base Investment Required".
It would be reassuring if ExxonMobil would give a detailed breakdown of where the "Required New Production" will come from as on the Uppsala graph.
Alternatives such as oil sands and shale can't be turned on overnight. The Alberta sands have been under development for decades and are producing only 1 million b/d, this is projected to double over the next decade.
According to ExxonMobil :
http://www2.exxonmobil.com/corporate/newsroom/publications/thelampno1_2003/page_5.html
"by 2015, we will need to find, develop and produce a volume of new oil and gas that is equal to eight out of every 10 barrels being produced today."
If all those barrels aren't there or if we have difficulty "building strong partnerships with host governments and local communities" (as they nicely put it - I'm sure you can think of examples) then we are in for a pretty nasty dose of market forces. This will be a "doomsday scenario" for people who are now barely subsisting on oil-based agriculture.
While tar sands are a economically viable resource we cannot develop them fast enough.
Just do the math. Conventional oil production is going to decrease by 2 mbd after the peak. The average tar sand production yields somewhere between 30.000 and 150.000 boe d per location. That means that you need about 20 startups per year to counter the decline. The costs associated with this are staggering.
The Canadian association of petroleum producers (Capp: www.capp.ca) predicts that the oil sands are going to add 1 million barrels to the total Canadian production in 2015.
Quote:
Total Canadian production, including Atlantic Canada, is projected to increase from the current 2.6 million barrels per day to reach 3.6 million barrels per day (b/d) by 2015.
For Venezuela a similar number is projected.
Should the peak occur in 2005 that would mean we are 18 mbd short of target in 2015 (about 40 mbd if you count production growth). While an increase of the oil price would certainly lead to more startups, this target simply is out of reach.
Especially if you consider that it takes a few years to plan and execute an oil sands project. We know pretty well what is going to happen in the next 6 years, and it won't be a sudden flood of oil.
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