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The ETP model was wrong - But is there a top for oil prices?

Discuss research and forecasts regarding hydrocarbon depletion.

Re: The ETP model was wrong - But is there a top for oil pri

Unread postby onlooker » Sun 17 Jun 2018, 13:59:11

I submit to you that the MAP veering away so much from the ETP predictions does NOT negate ALL aspects of the Etp theory and consequently all conclusions. Remember the MAP is NOT the Etp but simply an equation derived from it
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby AdamB » Sun 17 Jun 2018, 16:01:51

Yoshua wrote:The surplus energy from petroleum production will eventually fall to zero.


How do you define "surplus energy"?

Yoshua wrote: When the surplus falls to zero, the value of the surplus falls to zero as well.


Define your terms please. I'm not convinced that you understand that I can drill a well using grid fired electricity to run the rig or pump the well, and that electricity can come from natural gas, coal, nukes, sunlight or wind.

Yoshua wrote:Adam, you have extracted oil from oil fields, what would you say is the reason why on average only about 40% of the oil is extracted from the oil fields. What is the main resistance to get all of the oil up to the surface?


Oil from oil fields, gas from gas fields. Global average, as of right now, is well below 40%. The USGS makes a pitch for an average at the end of the day closer to 45%+ or so. Page 8, Figure 4A and B for natural gas. They also demonstrate the odds of how much higher, or lower it might be, across a range of oil field types.

And the USGS is also the same gang of geoscientists that said that, without economic constraints, it is possible to get all the oil and gas out of the ground.

That idea is best explained by the EIA in this white paper. That idea is best explained by this EIA white paper. Figure 1 if you are just interested in pictures.

I'm pretty sure I've provided this information before, I know I did when refuting the Hill nonsense. Any reason you can't be bothered to LEARN from top flight science and technical sources when such information is provided?
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby AdamB » Sun 17 Jun 2018, 16:14:56

onlooker wrote:I submit to you that the MAP veering away so much from the ETP predictions does NOT negate ALL aspects of the Etp theory and consequently all conclusions. Remember the MAP is NOT the Etp but simply an equation derived from it


I submit that after a few minutes of examination it was obviously a crock. The idea that it requires zealots years to figure out the same thing has nothing to do with the concept, but the obvious tendency to fall for whatever nonsense gets them to their favorite rapture scenario.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Yoshua » Mon 18 Jun 2018, 02:21:02

Adam

Fine, you have a point that if the energy to produce a barrel of petroleum comes from nat gas which has a higher EROI since it takes less energy to produce it, then in circular way of thinking, it takes "less" energy to produce petroleum, or at least it costs less in economic terms to produce petroleum by using nat gas as energy source, so there is an economic value to use this process.

The Etp Model is based on that a Btu is equal to a Btu no matter from which energy source that Btu comes from, or the cost of that energy source, or what the EROI of that energy source is.

Although the EROI of the energy mix declines when we use a high EROI energy source to produce a low EROI energy source, instead of just using the high EROI energy source as a source to power the economy.

Another problem is that petroleum counts for 1/3 of the energy mix, so when petroleum hits EROI 1:1 one third of the energy mix must be directed to petroleum production.

.....................

Yes, I have read the first one of the papers. I will look at the other one too (at least the pictures).

The Hill's group uses the heat pump and entropy in their model to explain the increased resistance to extract all of the oil, which increases the need to use more and more energy to continue the production.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Yoshua » Mon 18 Jun 2018, 02:54:38

The U.S uses 7.2% and the world 6.2% of GDP on energy? That is the root cause of U.S trade deficits? Who in the world can afford expensive Made in America products?
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Yoshua » Mon 18 Jun 2018, 07:56:14

...or actually...if petroleum production is EROI 1:1 then they don't lose any energy, they just transform 6mm Btu nat gas into 6mm Btu refined petroleum products...into more valuable energy types than nat gas...
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby kublikhan » Mon 18 Jun 2018, 12:03:29

Yoshua wrote:The U.S uses 7.2% and the world 6.2% of GDP on energy? That is the root cause of U.S trade deficits? Who in the world can afford expensive Made in America products?
You have it backwards. Energy is cheaper in the US. It is so cheap, that large energy consuming industries are setting up shop here. This cheap energy gives energy intensive Made in America products a competitive advantage.

The incredibly powerful combination of fracking and horizontal drilling has sent U.S. natural gas supplies through the roof and prices through the floor. With marketed production increasing about 35% since 2008 to ~78 Bcf/d, prices have plummeted over 60% to around $3 per MMBtu. Check this U.S. Energy Information Administration (EIA) graphic to see just how historically low our gas prices really are, here. Last year brought the lowest gas prices we have seen since 1999 - and prices will remain low for as far as our modelers forecast.

EIA just projected here that U.S. gas production will increase 1-2% per year in the coming decades, surging to 85 Bcf/d in 2020 and onto more than 100 Bcf/d by 2035 and even more in the subsequent years. This unstoppable rise in U.S. gas production stems mostly from an immense low cost resource base. At more than 100 years of supply, our domestic gas supply is very robust even when prices are low. The benefits of low cost natural gas are invaluable because cheap energy gives us a competitive advantage against global competitors.
Why U.S. Natural Gas Prices Will Remain Low

The surge in investment into the US petrochemicals industry over the past seven years has been one of the biggest spending booms in a developed country this century. A series of giant new plants that will make chemicals used to produce plastics, from companies including Dow Chemical and ExxonMobil, are about to come online. A second wave of projects is now being proposed, as some chemicals producers become increasingly confident that the cheap gas feedstock that makes their spending possible will last for a long time.

A decade ago, the US petrochemicals industry seemed doomed to long-term decline, eclipsed by rivals in the Middle East, which had cheap oil and gas for feedstock, and in Asia, where the market growth was strongest. The US shale revolution transformed that outlook, unleashing a flood of cheap natural gas liquids such as ethane and propane, which are key chemical feedstocks. Since 2010 $85bn worth of petrochemicals projects have been completed or started construction, with about a further $100bn proposed. “This is the place to be,” says Kevin Swift, the ACC’s chief economist. “We are the low-cost producer.”

The biggest new opportunity in the US has been for ethylene “crackers”: plants that take ethane and convert it into ethylene, a building block for plastics. Dow, Exxon, Sasol of South Africa, and CP Chem, the joint venture of Chevron and Phillips 66, have built large crackers along the US Gulf of Mexico coast that will be starting up in 2017 and 2018. US ethylene production is set to rise from 25.8m tonnes last year to 34.2m tonnes next year, an increase of 33 per cent.

Most of the additional output will go for export, typically after being converted to polyethylene pellets. As emerging economies adopt the habits of developed countries, their demand for plastics is growing 1.5 to 2 times as fast as their gross domestic product. “These expansions in the US are geared towards exports to Asia. What drives demand for plastics is the growing middle class in China and India.”
Chemical industry split about the case for more US plants
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby ROCKMAN » Mon 18 Jun 2018, 13:03:57

Yoshua – And to back up k’s point a couple of years ago two EU manufacturing companies shut down operations there and moved to south Texas to take advantage of our relatively inexpensive NG. One made industrial chemicals and the other a German company that made specialty steel.

And consider refining: the US has become not only the largest producer of petroleum products in the world but also the largest exporter. And how? On paper we import every bbl of oil we refine to produce all the diesel and other products we export. And despite what the ignorant amongst us continue to post none of the energy used to refine oil comes from the oil itself. It comes primarily from NG and a much smaller amount from electricity. Electricity produced by burning NG. Again, it is our abundant and relatively cheap NG that gives our refineries a huge advantage over foreign refineries.

Not sure how you equate these facts with GDP’s. But I don’t really care: it doesn’t change the fact that many US manufacturers have some advantage over foreign competition thanks to our relatively inexpensive energy. I also haven’t seen any reports of any portion of the US electric grid melting down due to too many folks watching the world soccer match. OTOH soccer isn’t as popular here. But it didn’t happen during the Super Bowl either. LOL.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Outcast_Searcher » Mon 18 Jun 2018, 13:10:07

ROCKMAN wrote:Not sure how you equate these facts with GDP’s. But I don’t really care: it doesn’t change the fact that many US manufacturers have some advantage over foreign competition thanks to our relatively inexpensive energy. I also haven’t seen any reports of any portion of the US electric grid melting down due to too many folks watching the world soccer match. OTOH soccer isn’t as popular here. But it didn’t happen during the Super Bowl either. LOL.

It's not that unusual for third world countries to have substandard power distribution, littered with many outages. Acting like that is anything new OR is a sign of economic doom is nonsense.

And generally, over time, as such countries progress economically, the power grid gets better. For one thing, businesses tend to require reliable power.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby AdamB » Mon 18 Jun 2018, 15:00:23

Yoshua wrote:Adam

Fine, you have a point that if the energy to produce a barrel of petroleum comes from nat gas which has a higher EROI since it takes less energy to produce it, then in circular way of thinking, it takes "less" energy to produce petroleum, or at least it costs less in economic terms to produce petroleum by using nat gas as energy source, so there is an economic value to use this process.


Well, we will call this progress. A more succinct way to say it is that the VALUE of a unit of energy is different based on its form. Therefore I can play form change games all day long, if they are in my economic interest. The ridiculous random number changer couldn't even make it this far with its understanding of the physical world, so you are already smarter than Shorty!

Yoshua wrote:The Etp Model is based on that a Btu is equal to a Btu no matter from which energy source that Btu comes from, or the cost of that energy source, or what the EROI of that energy source is.


No...it isn't. The equation Shorty uses was built on cherry picked data, excluding tremendous amounts of production (let alone resources) and only counting things he wanted to count. This is how you build a profile, similar to the "peak conventional oil" folks, who just exclude light sweet crude that they don't want to count to maintain a fiction they can base their own stupid ideas on. Shorty did the same, as anyone who went back and read his paper can tell you. This then is exactly why he can't backcast his equation..it was designed with limited data across a limited time span with random exclusions. You are getting lost in the goobly gook he throws into the mix later.

Which is why what he says next doesn't matter. You can fall for this standard routine ("If we assume that 2+2=5, then what follows must be true!" all you'd like. Skip first order principles at your own risk, the risk being Shorty then loses all his bets and as soon as the correlation/causation fallacy reveals itself (the true thing his equation does), and we all then know why you don't ask mechanical engineers questions about the oil and gas industry. Or peak oil zealots, or whatever the psychological fault it is that led him to do something so obviously ignorant in the first place.

Yoshua wrote:Although the EROI of the energy mix declines when we use a high EROI energy source to produce a low EROI energy source, instead of just using the high EROI energy source as a source to power the economy.


You can put as many of your words and interpretation on his idea as you'd like. Hall got it wrong for good reasons, he at least had a basis for his bad call. Shorty didn't even have that, he just made stuff up until his curves seemed to match...something. And suckers fell for it. Still are, apparently...but then that isn't a surprise, as the bell shaped curve crowds prove every day.

Yoshua wrote:
Yes, I have read the first one of the papers. I will look at the other one too (at least the pictures).


I was laughing my ass off within just the short beginning as to what energy was. I'm going to design an intro joke to an energy talk using his stuff sometime, I'll bet I can get an entire roof yucking it up over that nonsense.

Yoshua wrote:
The Hill's group uses the heat pump and entropy in their model to explain the increased resistance to extract all of the oil, which increases the need to use more and more energy to continue the production.


The Hill Group aka Bedford doesn't know anything about the oil field, geology, or economics in general or oil field economics specifically, so why in the world would you expect them to know what to use to explain ANYTHING within the industry?

2+2 isn't 5 Yoshua. Start there, and you understand what follows pretty quickly.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby ralfy » Mon 18 Jun 2018, 22:35:07

The catch is that oil and gas are used because earnings are to be made from increased sales of goods and services to the global population.

Given subsistence for everyone, we might be able to meet the needs of the global population. That obviously goes against the desire to maximize profits, especially for the few who control the global economy. Their goal is to allow for a growing global middle class, especially given the premise that investments are made in exchange for maximum return and profits. That will require several earths, which is not possible.

With that, there is no cheap energy.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby pstarr » Tue 19 Jun 2018, 00:16:58

The average price of crude oil for the six decades before 2005 (1947 to 2005) was $35. After which, the price suddenly increased to $100, where it remained for six years. Thus the United States citizenry every year sent $100 billion overseas to our enemies and other socialist/Muslim entities. $600 billion, $2/3 trillion dollars. Lost forever.

The average driving American's gasoline bill increased by $2,000 per year. For six years. We each of us, lost $12,000 during those horrible times. Lost to oil greedy, polluting and corrupt oil companies. Many enemies and/or socialist/Muslim entities.

And the cornies want to claim there is no top to oil prices. 8O I would prefer to mingle with true patriots. Not the likes of these turncoats. :x
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby AdamB » Tue 19 Jun 2018, 11:05:34

ralfy wrote:With that, there is no cheap energy.


Obviously you aren't buying, or selling, natural gas in the Appalachian basin over the past 4 years.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby AdamB » Tue 19 Jun 2018, 11:07:46

pstarr wrote:The average price of crude oil for the six decades before 2005 (1947 to 2005) was $35. After which, the price suddenly increased to $100, where it remained for six years. Thus the United States citizenry every year sent $100 billion overseas to our enemies and other socialist/Muslim entities. $600 billion, $2/3 trillion dollars. Lost forever.

The average driving American's gasoline bill increased by $2,000 per year. For six years. We each of us, lost $12,000 during those horrible times. Lost to oil greedy, polluting and corrupt oil companies. Many enemies and/or socialist/Muslim entities.

And the cornies want to claim there is no top to oil prices. 8O I would prefer to mingle with true patriots. Not the likes of these turncoats. :x


So now you are copying and pasting the same responses into different threads? Why is that? Because you didn't read anything prior and you can concoct a stupid answer that fits all prior posts, or did you just not even know you were in a different thread, and lacking any new ideas since peak oil a decade ago left you in a lurch, have just given up?
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby onlooker » Tue 19 Jun 2018, 11:13:35

No, because the post is applicable in different threads :razz:
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Outcast_Searcher » Tue 19 Jun 2018, 14:42:22

onlooker wrote:No, because the post is applicable in different threads :razz:

Except that the post was wrong. What six year period was oil $100?

Averaging near $100 for four years (2010 - 2014), yes.

I can understand how accuracy doesn't matter to Cassandras who constantly wrongly predict economic doom is in our face, but ignoring accuracy doesn't help credibility.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby AdamB » Wed 20 Jun 2018, 10:32:14

onlooker wrote:No, because the post is applicable in different threads :razz:


Really? Pstarr was commenting on the ETP was he?
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Yoshua » Wed 20 Jun 2018, 10:58:16

Another reason for the higher share of GDP consumed on energy in the U.S is the larger share of high cost petroleum used in the U.S energy mix (37%) than the world on average.

The U.S GDP is produced by using petroleum as 37% share of the energy mix. If I generalized and said the share of petroleum used as an energy source in petroleum production accounts for 37% of the total...you would of all object...but too late...I already made the generalization.

The U.S trade deficit of energy, goods and services is produced by using energy somewhere else in the world. In exchange the U.S sends digital dollars. That must be the most energy efficient way that the U.S has ever invented to get energy, goods and services for the U.S.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Cog » Wed 20 Jun 2018, 11:03:36

Doesn't matter how much the USA consumes. What matters is how much we produce at a profit and our ability to continue to supply our needs.
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Re: The ETP model was wrong - But is there a top for oil pri

Unread postby Outcast_Searcher » Wed 20 Jun 2018, 14:44:52

Yoshua wrote:Another reason for the higher share of GDP consumed on energy in the U.S is the larger share of high cost petroleum used in the U.S energy mix (37%) than the world on average.

The U.S GDP is produced by using petroleum as 37% share of the energy mix. If I generalized and said the share of petroleum used as an energy source in petroleum production accounts for 37% of the total...you would of all object...but too late...I already made the generalization.

Making up random stuff re energy might be fun, but it doesn't matter re the real world in terms of economics.

Witness the ETP nonsense, for example.

The more empty economic theories you bloviate without any credible backing, the less credible you are on the entire subject.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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