[Graeme]

Without oil, modern civilisation doesn’t work

Treasury’s last Inter-generational Report contains, hidden away on page 91, a simple stunning statement: Australia’s oil will be gone by 2020. The timing could not be worse. By 2020 Peak Oil is likely to have rendered oil imports precarious and costly. And without oil, modern civilisation doesn’t work.

The media ignored this part of the Report, so the ministers of our two major parties and the bureaucrats who advise them, have rarely been required to explain why they let this happen. On those rare occasions the question has been brushed aside with assurances that either market forces will always supply oil (or a substitute) at reasonable prices or Australia has vast reserves of natural gas.

Both these arguments are shaky. Firstly, for many uses, such as aviation, mining, and most road transport, there simply is no good substitute for oil. No one has yet built a gas-powered plane.

It may seem impressive to find an urban taxi scooting around powered by a large tank of compressed gas that has taken over the boot, but the energy required to find and transport that gas, and to compress it to an amazing 2500 psi, and safely seal it in a robust tank, did not come from gas. We are a long way from knowing how to run our civilisation on gas.

And without cheap oil, most business plans might crash. BHP for instance is threatening to pull out of the Olympic Dam expansion unless diesel prices are kept low but the Pentagon’s projection is that oil prices will in time double.

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[SeaGypsy]

Olympic dam is one of the biggest multi- metals mines in Australia. It produces Uranium and Copper primarily. Reading between the lines, if Uranium and or Copper don't rise faster than oil, (something that so far hasn't happened, more the inverse) they won't be able to afford to run the mine. If/ when Olympic becomes unprofitable, so will the bulk of the rest of Australia's mines. During the last big spike in prices, most of Australia's gold producers went into shutdown/ slowdown. Metals are effectively another form of oil.

Meanwhile our government is following in the footsteps of Obama to prop up the ailing car industry, which unlike that in the USA, has exactly zero in terms of electric vehicles or real alternative fuel vehicles. The only exception is our LPG installed fleet, which only exists because we have an excess of propane as a by-product of oil and NG.
How much propane will come from NG extraction without the oil derived component/ I have never seen figures for, but I doubt it is anywhere near enough to convert the fleet.

[Timo]

Without oil, what we now know and understand as civilization certainly will be broken. Some sense of civilization will continue, but i predict a very uncivilized nature to it. But, on the other hand, the one that shields the bright light of the future from my eyes, i am becoming very impressed with a lot of the new technologies and materials sciences that could very well make the need for fossil fuels a thing of the past. Graphene, for example, could lead humanity into a bright, new era of civilzation. Looking a the world today is sort of like seeing the glass half empty kind-of-thing. You pretty much see the same thing as everybody else does, but our brains are somehow programmed to intrepret these realities differently. As for myself, i'm a lot less worried about a world without oil than i am about the sheer volume of human population living on this planet. Half the current volume of each would resolve nearly every problem collectivily facing this planet.