The Export Land Model

[AirlinePilot]

From Westexas over at TOD......

The four largest sources of imported oil into the US are Canada, Mexico, Venezuela and Saudi Arabia.

Venezuela's net exports started declining in 1998.

Mexico's net exports started declining in 2005.

Saudi Arabia's net exports started declining in 2006.

Only Canada has shown an increase, and their increase in net exports has not even been sufficient to offset the recent declines in any of the other three countries.

The four countries' combined net exports in 2005 were 14.1 mbpd, and in 2009 they were down to 11.0 mbpd--as Canadian net exports increased from 0.79 mbpd in 2005 to 1.02 mbpd in 2009 (BP). Granted, there was some level of voluntary reduction in production in Saudi Arabia in 2009, but I suspect that most of what they shut-in was what Matt Simmons characterized as "Oil stained brine," and the key point is that Saudi Arabia, Mexico and Venezuela are all showing multiyear net export declines, relative to recent peaks.

Note that the increase in US production (C+C+NGL) from 2005 to 2009 was about 0.3 mbpd (and of course 2005 was suppressed because of the hurricanes), and the increase in Canadian net oil exports from 2005 to 2009 was about 0.2 mbpd. So increased US production + increased Canadian net oil exports from 2005 to 2009 was a combined 0.5 mbpd. Over this same time frame, 2005 to 2009, combined net oil exports from Saudi Arabia, Mexico and Venezuela dropped by about 3.3 mbpd.

[pstarr]

We are still getting what we need from these four declining exporters. That tells me some country somewhere is not receiving their share. Could it be Zimbabwe? Haiti? Ireland? Portugal? Greece?

Nah. Those problems are mortgage related

[gollum]

We are still getting what we need from these four declining exporters. That tells me some country somewhere is not receiving their share. Could it be Zimbabwe? Haiti? Ireland? Portugal? Greece?

Nah. Those problems are mortgage related

We are also needing less, lots of people not going to work every day who were 3 years ago, less vacations, less air travel.

[pstarr]

We are still getting what we need from these four declining exporters. That tells me some country somewhere is not receiving their share. Could it be Zimbabwe? Haiti? Ireland? Portugal? Greece?

Nah. Those problems are mortgage related

We are also needing less, lots of people not going to work every day who were 3 years ago, less vacations, less air travel.

But our consumption has not dropped 3.3 mbpd. Someone's must have correct?

[Revi]

I'm sure you check some of the smaller countries and their consumption has gone down more than ours. Meanwhile China and India are using more.

Not a pretty picture.

I think we'll run into shortages this next year, and that will drive the price up big time.

Check out Gregor's prediction to 2015:

http://gregor.us/

[M_B_S]

http://www.marketwatch.com/story/exxon- ... 2011-12-08

Exxon Mobil projected a decline in U.S. oil imports to seven million barrels of oil per day by 2040, with most of the foreign crude coming from Canada and Mexico. Imports from countries other than Canada and Mexico "will decline to almost zero," Colton said. Currently, more than 40% of U.S. imports come from members of the Organization of Petroleum Exporting Countries, including Saudi Arabia, Venezuela, Nigeria and Angola.Exxon's projections underscore the shifting dynamics of the global energy industry; as China and India consume more Middle Eastern oil, the Western Hemisphere is bound to increasingly rely on newly tapped energy resources.....
****************************************

I would say that EXXON is in line with the ELM

PEAK OIL

M_B_S

[vaseline2008]

Someone with photoshoping capabilities should label the man in this pic Jeffrey Brown and write "Export Land Model" on the horse....

Does that work?

[AirlinePilot]

Direct evidence of ELM..this is going to be the chart to watch IMHO.

[M_B_S]

http://www.eia.gov/dnav/pet/hist/LeafHa ... RIMUS2&f=M

ELM for US crude oil imports.




Peak over Peak in 2006

q.e.d.

M_B_S

Chefurka:

[AirlinePilot]

Quoted from a post over at TOD.....

"Some interesting net export math numbers I'm working on a long delayed update to our last article on global net exports, and some interesting numbers follow.

"Export Land" went from final production peak to zero net oil exports in 9 years, and if we extrapolate the rate of increase in their consumption to production ratio from the production peak to three years later, it accurately predicted when they would hit zero net oil exports.

Based on the BP data base, Indonesia's apparent final production peak was in 1991, when they net exported 0.97 mbpd. Their Post 1991 Cumulative Net Exports (CNE) were 2,090 mb (BP, Total Petroleum Liquids)

Indonesia’s C/P ratio increased from 42% in 1991 to 52% in 1994, a 7.1%/year rate of increase. If we extrapolate this three year rate of increase, they would have hit the 100% mark in 2003, which they did. Their 2002 C/P ratio was 94%, and their 2003 C/P ratio was 105%.

In 1992, year one of a 12 year net export decline period, Indonesia shipped 14% of post-1991 CNE. Note that "Cowboy Integration" (Annual Net Exports at Peak X Number of Years to zero Net Exports X 0.5) would be 2,130 mb, versus the actual value of 2,090 mb. The 12 year estimate is based on extrapolating the 1991 to 1994 rate of increase in their C/P ratio.

I have conceded the point that once a country starts showing an increasing C/P ratio, it's not an absolute certainty of course that we can predict what their C/P ratio will be in 10 to 20 years*, but I do think that the larger group that we have that is showing an increasing C/P ratio, the more likely it is that the group is following in the paths of former net oil exporters like Indonesia, et al.

Having said that, Saudi Arabia's C/P ratio increased from 18% in 2005 to 22% in 2008. If we extrapolate this rate of increase, they would be at 27% in 2011. My estimate for the 2011 Saudi C/P ratio ranges from 27% to 28.5%. In any case, extrapolating the 2005 to 2008 rate of increase suggests that Saudi Arabia would approach zero net oil exports around 2030, which is consistent with Sam Foucher's modeling.

Based on the model and several case histories, Saudi Arabia may have shipped about half of their post-2005 CNE by the end of next year. 2013.

And extrapolating the global numbers suggests that the top 33 net oil exporters may have shipped half of their post-2005 CNE by the end of 2020.

And extrapolating Chindia's combined net imports as a percentage of GNE suggests that half of post-2005 CANE (Cumulative Available Net Exports) may have been shipped by the end of next year, 2013.

*Saudi Arabia showed a large increase in their C/P ratio from 1980 to 1985, but this corresponded to falling oil prices, as the Saudis cut production, trying to prop up oil prices, until they increased production in 1986, in order to regain market share."

[kublikhan]

Note that Saudi Arabia showed a very sharp increase in net exports from 2002 to 2005, as global crude oil prices doubled from $25 in 2002 to $55 in 2005. In response to the first crude oil price price doubling, we did of course see a substantial increase across the board in total liquids production (inclusive of biofuels), in total petroleum liquids, in crude + condensate (C+C), and in Global Net Exports (GNE) and in Available Net Exports (ANE).

In response to the second Brent crude oil price doubling (2005 to 2011), we have so far seen a very slow rate of increase in total liquids production (up 0.5%/year from 2005 to 2010), virtually flat total petroleum liquids and virtually flat C+C production (through 2010), and a 1.3%/year and 2.8%/year respective decline rate in GNE & ANE (through 2010). GNE fell from 46 mbpd (million barrels per day) in 2005 to 43 mbpd in 2010, while ANE fell from 40 mbpd in 2005 to 35 mbpd in 2010.

annual "Gap" charts follow, showing the gaps between where we would have been at the 2002 to 2005 rates of increase, versus the actual data in 2010.

Perhaps oil prices could be rising because of a declining supply of net oil exports?

[AirlinePilot]

US total petroleum liquids production (BP) increased from 7.2 mbpd (pre-hurricane) in 2004 to 7.5 mbpd in 2010 (and probably to about 7.7 mbpd in 2011). From 2004 to 2010, despite increasing net exports from Canada, the combined net oil exports from the seven major net oil exporters* in the Americas and the Caribbean fell from 6.2 mbpd in 2004 to 4.8 mbpd in 2010, down 1.4 mbpd, a decline of 23% in six years.

So, just the regional decline in net exports, from 2004 to 2010, was about five times the size of the increase in US production. The 2005 to 2010 decline in Global Net Exports (GNE) was about 10 times the size of the recent increase in US production, and the 2005 to 2010 decline in Available Net Exports (ANE) was about 17 times the size of the recent increase in US production.

*Canada, Colombia, Venezuela, Mexico, Argentina, Ecuador, Trinidad & Tobago

[dissident]

http://www.theglobeandmail.com/report-o ... le2191152/

According to the above article the increasing US total liquids production is a threat to Canada's oil sales. This is so idiotic it is surreal. The only way that the Canadian exports would be threatened is if the US was self sufficient in oil production or for some odd reason decided to boycott Canada and import more from Saudi Arabia or elsewhere. These token US "oil" production increases are being touted as proof that peak oil is a silly notion. Innumeracy is a sad thing to behold.

The export land model tells us that the crunch will come much faster than it would appear based on depletion of existing oil fields alone. This point is completely alien to the media coverage of anything related to oil. Absurd pieces such as the one above, which are basically focused on domestic production and not even consumption, are what makes up the public information space. People have to come to "fringe" internet sites such as this one to get any information at all about how serious things are. As far as the economy is concerned it is the net export figure that matters and not global production. So even though not a single economist can be seen saying this in the MSM, we are already past peak. Somehow it is hard to believe that the global economic crisis since 2008 is merely a coincidence.

[ragged]

I thought this was a good article:

The Economist: Keeping it to themselves Gulf states not only pump oil; they burn it, too: http://www.economist.com/node/21551484

Yet these calculations do not take account of the region’s growing thirst for its own oil. Between 2000 and 2010 China increased its consumption of oil more than any other country, by 4.3m b/d, a 90% jump. It now gets through more than 10% of the world’s oil. More surprising is the country that increased its consumption by the second-largest increment: Saudi Arabia, which upped its oil-guzzling by 1.2m b/d. At some 2.8m b/d, it is now the world’s sixth-largest consumer, getting through more than a quarter of its 10m b/d output.

Saudi Arabia is not the only oil-producer that chugs its own wares. The Middle East, home to six OPEC members, saw consumption grow by 56% in the first decade of the century, four times the global growth rate and nearly double the rate in Asia (see map).

The third reason for rising Gulf consumption is the inefficiency of domestic energy markets. Some 65% of Saudi electricity is generated using black gold, even as successive price shocks and the relative inefficiency of oil generation have seen it all but phased out in rich countries. Oil is used with such profligacy because domestic consumption is massively subsidised. According to the International Energy Agency, global oil subsidies added up to $192 billion in 2010. OPEC countries accounted for $121 billion of the total.

Saudi Arabia has the cheapest fuel in the Gulf and dirt-cheap electricity, too. This has alleviated poverty but it has also encouraged an American-style driving culture (for men) and limited public transport. Only a third as many Saudis own cars as Americans; as they get richer many more will take to the desert highways.

[Keith_McClary]

http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/us-oil-production-a-threat-to-canadian-energy-industry/article2191152/

According to the above article the increasing US total liquids production is a threat to Canada's oil sales. This is so idiotic it is surreal.

The point is, the only pipelines run south.

Mr. Wuori pointed to the current discount of nearly $25 (U.S.) per barrel applied to oil traded in the landlocked central parts of North America.

“That’s an example of just how serious price degradation can be when you have too much supply and not enough outlet,” said Mr. Wuori, for whom the coming changes provide further reason for Canada to pursue other markets. Enbridge, the country’s largest transporter of crude, is a major proponent of such plans, with its $6.6-billion Northern Gateway pipeline that would bring oil sands crude to the Pacific coast for export to Asia and California.

[Keith_McClary]

Blast from the past (I didn't pay $2.95 for the remainder of the 721 words).

The Washington Times: Oil and Iraq's future‎
$2.95 -
Washington Times - Apr 17, 2003
With an export potential of 7 million barrels per day achievable within about six years, Iraq could be generating about $64 billion per year at a price of
...
With the coalition of the willing having vanquished Saddam Hussein's regime in Iraq, it is now up to the "coalition of the drilling" to provide the resources to underwrite Iraq's political and economic development after decades of repression and economic mismanagement. Let there be no doubt: Iraq's immense oil and gas reserves 112 billion barrels of proven oil reserves; at least another 100 billion barrels of potential oil ...

Complete Article, 721 words ( )

This assumes $25 oil.