[Twilight]

If that data was showing "reserve growth" without backdating additions to original discovery dates, that would explain why KTH's claim of what it shows sounds so outlandish. Every year the world consumes more oil than it discovers, and this has been the case for coming up to 30 years. Reserve growth from reappraisals of economic recovery, inclusion of new categories of difficult oil and spurious reporting do not change the discovery trend. What it does is say we used 30bn barrels of mostly great stuff and replaced it with tar and unverifiable paper barrels that - yes - appear to be as made up as anything on the internet as Kuwait's reversal of past revisions demonstrates.

Note that this is only discussion of KTH's interpretation, not the data itself as it has not been presented here. It is impossible to say which of those sources of error are the case here. But these are the old tricks that appear again and again when reserve replacement appears too good to be true.

By the way, the EIA, like the IEA, BP Statistical Review, the journals and others, do not rely exclusively on data they gather themselves. Most of the reported reserves are on the books of NOCs which report whatever they like, and their numbers (in some cases unchanging for 20 years) are reproduced without comment. There are no independent audits of the claims of some of the most important producers in the world. We only have their word, so "buyer beware" when reading even the most reputable statistical publications.

[KillTheHumans]

21 Reality & Illusion
This shows the effect of proper backdating. The discovery trend shown in yellow is falling not rising.

Do you even have a clue as to why this doesn't matter in the least when calculating reserve growth? Maybe you missed that class during the "learn to be an expert in 3 easy lessons" day?

[KillTheHumans]

You sir, are going to have some FUN around here!

I had the impression that you needed some provocation, so I delivered it. javascript:emoticon(':)') I do not know enough about the arguments on each side of the oil reserve controversy

Well, don't feel bad, except for one or two of us around here who might have done them, all these guys are capable of is quoting other people who don't know how to do them either.

Now that I have your attention please be informed that I am well versed in coal gasification and have been involved in the pyrolysis process using plasma energy to convert any organic material to hydrogen and carbon black. More than a decade ago the concept was not profitable, because there was no use for large quantities of hydrogen and even less for carbon black. We have unlimited supply of organic materials suitable as feed material including, but not restricted to garbage, scrap tires, poisonous warfare agents, etc.
Building pyrolysis reactors is cheaper and faster than going for oil in its more difficult formations.

Well, having knowledge on ANY of the reasonable solutions which smart people around here occasionally bring up won't win you any friends either. If you can't come up with an occasionally rousing new verse to the "WE'RE ALL GONNA DIE!!!" refrain...well....lets just say that those of us in the business or having knowledge of whats going to make peak oil irrelevant aren't particularly popular.

[KillTheHumans]

Every year the world consumes more oil than it discovers, and this has been the case for coming up to 30 years. Reserve growth from reappraisals of economic recovery, inclusion of new categories of difficult oil and spurious reporting do not change the discovery trend.

Reserve growth doesn't really say anything about the past discovery trend, its just a number, so in that respect your are correct. But it isn't required to. When you "discover" more oil than you consume, it doesn't matter whether its in a 100 year old heavy oil California field or a 5 year old offshore deep water field. Its economic, its there, and it has arrived.

And it isn't spurious reporting when you put it in your gas tank, a point everyone tries so studiously to pretend doesn't exist when proclaiming their dislike for reserve numbers.

By the way, the EIA, like the IEA, BP Statistical Review, the journals and others, do not rely exclusively on data they gather themselves. We only have their word, so "buyer beware" when reading even the most reputable statistical publications.

Fortunately, some of us are not limited to EIA, IEA or BP data when we put together our insights on the subject.

[TWilliam]

We have unlimited supply of organic materials suitable as feed material including, but not restricted to garbage, scrap tires, poisonous warfare agents, etc.
Building pyrolysis reactors is cheaper and faster than going for oil in its more difficult formations.

Ummm... I'm not particularly interested in the reserve growth debate right now, but I have to wonder. When this 'unlimited supply of organic materials suitable as feed' stock turns out to be NOT 'unlimited', since at least the ones you've named are all derived from a SHRINKING petroleum resource base, then what?

Oh wait, let me guess. Coal gasification, right?

*sigh*

Just exactly what part of UNINHABITABLE PLANET don't you people get?

[Geomancer]

We have unlimited supply of organic materials suitable as feed material including, but not restricted to garbage, scrap tires, poisonous warfare agents, etc.
Building pyrolysis reactors is cheaper and faster than going for oil in its more difficult formations.

Ummm... I'm not particularly interested in the reserve growth debate right now, but I have to wonder. When this 'unlimited supply of organic materials suitable as feed' stock turns out to be NOT 'unlimited', since at least the ones you've named are all derived from a SHRINKING petroleum resource base, then what?

Oh wait, let me guess. Coal gasification, right?

*sigh*
Just exactly what part of UNINHABITABLE PLANET don't you people get?

I believe the world has three unlimited supplies: Taxes, garbage and ignorance .javascript:emoticon(':-D')

[TWilliam]

I believe the world has three unlimited supplies: Taxes, garbage and ignorance .javascript:emoticon(':-D')

Yes well... I'm certainly seeing plenty of evidence of the last anyway...

Seriously tho', my original question was earnest. I've noticed that just about every time someone brings up the idea of 'garbage-into-fuel' and/or its assorted variations (such as 'food-into-fuel') as a 'solution' to declining oil production, they almost always manage to conveniently overlook the fact that our massive amounts of garbage are a direct byproduct of our massive consumption of mainly OIL. They either ignore, or are oblivious to the fact that less oil feedstock means LESS GARBAGE.

It's essentially the same problem with all so-called alternatives: they are, in fact, DERIVATIVES of cheap and abundant petroleum. They're not really ALTERNATIVES at all. Virtually all of these 'alternative' technologies rely on OIL for their fabrication and deployment, and as it gets scarcer and more expensive, they will likewise become increasingly expensive and less available for widespread use.

[Geomancer]

I believe the world has three unlimited supplies: Taxes, garbage and ignorance .javascript:emoticon(':-D')

Yes well... I'm certainly seeing plenty of evidence of the last anyway...

Seriously tho', my original question was earnest. I've noticed that just about every time someone brings up the idea of 'garbage-into-fuel' and/or its assorted variations (such as 'food-into-fuel') as a 'solution' to declining oil production, they almost always manage to conveniently overlook the fact that our massive amounts of garbage are a direct byproduct of our massive consumption of mainly OIL. They either ignore, or are oblivious to the fact that less oil feedstock means LESS GARBAGE.

It's essentially the same problem with all so-called alternatives: they are, in fact, DERIVATIVES of cheap and abundant petroleum. They're not really ALTERNATIVES at all. Virtually all of these 'alternative' technologies rely on OIL for their fabrication and deployment, and as it gets scarcer and more expensive, they will likewise become increasingly expensive and less available for widespread use.

Quite seriously you should take a step back and consider that decaying plants and animals, as well as living organisms are organic matter and are not related to any oil produced. Household garbage may contain oil derived garbage but decaying food products are abundant,so are waste plants unusable for food or other utilization. One of the most lucrative sources of organic materials , however, are hazardous wastes which provide a major revenue source at the input of the process. I agree that there is a lot of waste product generated by oil and it is not properly utilized to recover the energy stored in it.
Noticed I have not even touched the largest source on earth - coal. My hands and arguments are clean.

[TWilliam]

Quite seriously you should take a step back and consider that decaying plants and animals, as well as living organisms are organic matter and are not related to any oil produced.

No, but they are related to something called a nutrient cycle. Such things need to be returned to the soil, not burned for energy generation.

Household garbage may contain oil derived garbage but decaying food products are abundant,so are waste plants unusable for food or other utilization.

Ummm... I seem to recall that decaying food 'abundance' being a result of the so-called 'green revolution', which is a direct result of heavy petrochemical use. No petrochemicals, no 'abundant' food waste, firstly because it's doubtful the yields we currently enjoy will be maintainable without them, secondly because as they dwindle, returning that waste to the soil will become even more vital, thus reducing its availability for energy generation even further.

One of the most lucrative sources of organic materials , however, are hazardous wastes which provide a major revenue source at the input of the process.

Somehow the idea of burning hazardous waste doesn't strike me as being particularly intelligent.

Noticed I have not even touched the largest source on earth - coal.

Good thing. Like I said... uninhabitable planet, at least if we expect to use coal at anywhere near the level at which we currently use oil.

[Specop_007]

Geesh, some of you are so rude to 'newbies'(not just this one). I thought the point of this site was to educate people, not scare them away before you even get the chance.

Agreed, but its also best to do a bit of due diligence on ones own part before coming to an established forum and hopping in with a smile "Dont worry, we can do THIS!"

What's rude is people joining this site because they read some article in a newspaper, thinking they're just going to start telling everyone here 'how it REALLY is' when they've done little or no research beyond what they've been spoon fed by the mainstream media, or what they've gleaned from the half-drunken blithering of the resident know-it-all at their favorite watering hole.

Not saying you're necessarily one of these JustaGirl (welcome to the site by the way), but most of the people that have been members here for any length of time HAVE actually explored this issue at length, and from many different angles, and while granted it may be true that, as the saying goes, "you catch more flies with a spoon of honey than you do with a gallon of vinegar", the fact is that we've heard, and have explored in depth, just about every variety of "all we have to do is [insert favorite insta-fix here]" and "the REAL reason for high oil prices is because of [insert favorite villain(s) here]", and some have lost patience with endlessly walking people through the same stuff again and again and again, which is why they generally get pointed towards the threads where the particular topic has already been addressed.

We tend to baptize in fire, and if someone is unwilling to don their flame-proof undies (meaning reading up first) before they jump into the fray, they'll likely get cooked rather quickly. It's nothing personal really; it's just that many here sincerely feel that the time for polite hand-holding is well past, and that John Q. Public is now overdue for a hard slap in the face (which is coming by the way, and not from folks here believe me).

Well said! Do what I do, drink heavily. I find I'm much friendlier if I'm drunk.

[ROCKMAN]

Geomancer,

Please don't let some of the reviews of your thoughts turn you off to this site as well as others. You are trying to understand a very complex system. I've been a petroleum geologist for over 30 years and I have disagreements with my cohorts over such technical issues almost daily.

I'll offer one bit of advice regarding the supply issue: it's very easy to confuse reserves in the ground with production rates. For example, I know a bit about Petrobras' offshore projects. They may well eventually discover more oil than has been produced from the North Sea or many other very large plays. But reserves in the ground don't readily equate to production rates. I suspect you have some idea of the time lag for a deep water discovery to start producing (5 to 10 years is not uncommon). But regardless of that fact, maximum flow rates seldom exceed 500,000 bopd. And then declines can be very rapid. Most of the big deep water discoveries in the Gulf of Mexico have already declined more than 50% and will drop to relatively meaningless levels in another 5 years.

Just hang in there and develop a tough skin. I consider myself exceptionally smart and I've been wrong about a variety of matters as often as I've been right.

[Specop_007]

We have unlimited supply of organic materials suitable as feed material including, but not restricted to garbage, scrap tires, poisonous warfare agents, etc.
Building pyrolysis reactors is cheaper and faster than going for oil in its more difficult formations.

Ummm... I'm not particularly interested in the reserve growth debate right now, but I have to wonder. When this 'unlimited supply of organic materials suitable as feed' stock turns out to be NOT 'unlimited', since at least the ones you've named are all derived from a SHRINKING petroleum resource base, then what?

Oh wait, let me guess. Coal gasification, right?

*sigh*

Just exactly what part of UNINHABITABLE PLANET don't you people get?

Soylent black
ITS PEOPLE!
But it sure powers the car well.

[PeakOiler]

I put together some data from the EIA and made this graph of Proved Oil Reserves vs. the Average WTI futures price since 2000:



I searched the forum and found this thread. It seemed like a good place instead of starting a new one.

The EIA data only goes through 2014.

See EIA Reference and EIA Table

Will the proved reserves go down in 2015 and 2016 since the price has dropped?

[sparky]

.
Contrarily to many belief , not all traders are moronic screen jockeys ,
certainly the short term trading is flighty
it's modus operandi is "follows the mob from the front" even if it's to jump off a financial cliff
however long term positions are more carefully considered , not only hard geologic date but financials and technicals are pored over by very well paid analysts .
a substantial increase in proven resources are parsed into several scenarios for any increase /decrease in proven reserves

[ROCKMAN]

Peaky - Mucho thanks...interesting chart.

"Will the proved reserves go down in 2015 and 2016 since the price has dropped?" That depends on whose reserve estimate you're talking about. If it's US pubcos of course they'll decline...write downs are continuing. By US law only those reserves that are economically recoverable can be posted. And that metric will require the current oil price be used. IOW the in ground reserve volume does change nor do the "technically recoverable" reserves decrease. But "commercially recoverable" reserves are dependent on the price of oil.

It's great to see the lag time between increases in prices and how long it takes before the actual response shows up. It obviously also works that way on the down side. But it does get complicated separating producing reserves from undeveloped reserves. Reserves A might have required $90/bbl to be initially economic but were developed at that time. But once drilled and producing it might take only $10/bbl to allow commercial production to continue. But Reserve B might be identical in nature to Reserve A but isn't producing yet and at $50/bbl may be no longer be classified as economic and thus = zero. This would be a huge adjustment for the shale plays since locations adjacent to drilled wells were allowed to be counted as proved. BUT COULD ONLY RETAIN THAT STATIS AT THE HIGHER OIL PRICE. And thus the huge reduction in US pubco values: lower revenue from proved producing reserves PLUS the loss of proved undeveloped reserves.

Of course none of this applies to the KSA, Russia and many other countries since they don't have to follow the SEC protocol in the US.

[PeakOiler]

Thanks ROCKMAN. I agree about the time lag that one can glean from the graph. It is interesting. But would the 2015, and eventually the 2016 data show some decline? (Another time lag is the EIA's data reporting. I wonder why the 2015 data hasn't been released? I guess we'll have to wait until 2018 to see the 2016 data).

I'm curious how the EIA accounts for depletion of the various plays in their reserve estimates.

[sparky]

.
The other side of depletion is bringing new fields on line , it seems to me that the running costs are rather low while development of new ones, especially of new provinces, are getting ever more capital intensive .

wouldn't this skew the development toward smallish, cheap, no technical problems, type of wells
rather than the super giants headaches makers ?

[ROCKMAN]

Sparky - Not really. Just focusing on the US for the moments those smaller LESS technically challenging projects fall within the world of the privately owned independents like the Rockman's company. And we've been chasing them relentlessly since the Rockman started more then 40 years ago. IOW there is no big inventory of such projects out there just waiting for someone to start looking for them. Same reason the small public independents went after the shales so hard: they had little else to chase.

[AdamB]

I'm curious how the EIA accounts for depletion of the various plays in their reserve estimates.

I asked them that question once, during one of their annual "bring in the outside world and ask them questions" sessions. Turns out, the reserve estimates they publish are done by an entirely different gang (Office of Energy Statistics) then the ones doing the bookkeeping and modeling (Office of Energy Analysis) of resource development into the future. Both reserves and resources are future looking estimates, so neither of those two gangs really spent much time looking backwards. Once produced, those hydrocarbons were just an addition to cumulative production totals. Back in 2014 they were walking around a new product that tracked exactly this kind of information though, technically recoverable resource estimates, reserve estimates, costs of those resources, number of wells drilled per year in the past, type curves of well level production rates, wells with secondary phase production and how much, cumulative production in the past, and you could then figure out % depletion of the whole play based on all the numbers included. They were vetting this thing with the geologists of the USGS, some statisticians, the Bureau of Economic Geology folks in Texas and West Virginia, the heavy hitters in the resource and science world.

[sureshbansal342]

Peak oil theory ( commercial interesting ) may be correct but fossil fuel theory is a big mistake of modern science and major obstacle to solve other important pending natural puzzles .