[DesuMaiden]

Since 2005, world oil production has been stagnate at around 80 to 90 million barrels a day. Apparently, we can at most increase world oil production to the absolute maximum of about 95 million barrels a day, but not any higher than that. When will world oil production start to decline? I believe in another year or two, world oil production will enter a permanent decline. Every year the decline will only be 1 or 2% which isn't very much individually, but over time, this will have a significant impact on our oil supply.

Conventional oil production peaked in late 2005. During the last 8 to 9 years, world oil production has remained stable mainly because unconventional oil has kept world oil production from collapsing. Unconventional oil production around the world will also soon peak, which will lead to world oil production declining very soon.

There is also the issue of peak coal. Coal is about to peak soon. Most estimates say USA coal production will peak before 2030, and very likely around 2025 which is only 10 years from now. Afterwards, the demand for coal in the USA (and perhaps even the whole world) will outstrip the supply of coal. This will cause the price of coal to skyrocket. The same principal applies to peaking of oil production. When oil production peaks, the demand for oil will outstrip the supply of oil. This will cause the price of oil to skyrocket.

Hitting peak coal will mean hitting peak electricity, but peak oil is also indirectly related to peak electricity. To extract coal that's later used to generate electricity, about 50% or more of the energy for extracting coal comes from oil. With a diminishing oil supply that is becoming ever more expensive, it will become more expensive to use oil to mine for coal. This will drive the price of coal UP. And when the price of coal goes up, the price of electricity goes up, since about 50% of all of the electricity in the world is generated by burning coal.

Renewable energies occupy too small a share of total energy production, and it will require many decades and literally trillions of dollars of investment capital to ramp renewables up to a level where they can successfully replace fossil fuels for electricity production. And so far, there is no reliable renewable alternative for transportation liquid fuel.

Solar and wind energy can only be used for generating electricity. Electric cars will simply not work for a number of reasons. First of all, electricity storage will degrade over time as you use the batteries of an electric car over time. Secondly, it takes a huge amount of oil-based energy to produce an electric car...all of the plastics in an electric car require at least 27 barrels of oil to manufacture. Lastly, electricity is NOT an energy source. Electricity is generated by burning or using some other energy source. And since the primary energy source for electricity is fossil fuels, you are not really making electric cars anymore fossil fuel independent by using electricity as an intermediary for fossil fuel usage. The electricity needs to be generated from renewable sources for electric cars to run on renewable energy.

Lastly there is ethanol...ethanol is a complete joke. It takes almost as much energy to produce ethanol as you get from burning ethanol. All of the fossil fuel energy that needs to be used to grow the corn for producing ethanol is enormous. Also, even if you converted all of the arable land for growing corn in the USA into ethanol, you will only be able to satisfy 15% of USA's total liquid fuel consumption. So you will never be able to produce enough ethanol to power the USA car fleet.

Overall the message is pretty clear. There is nothing in any combination, anywhere that can replace the edifice built by fossil fuels.

[DesuMaiden]

Desu, I know all the stuff, but I am just too tired to repost it forever. Who are you speaking to? Do you think they will listen?

I'm talking to you.

[dolanbaker]

Desu, I know all the stuff, but I am just too tired to repost it forever. Who are you speaking to? Do you think they will listen?

I'm talking to you.

Preaching to the choir usually just bores them eventually, that's the sort of stuff for a blog.

[DesuMaiden]

Desu, I know all the stuff, but I am just too tired to repost it forever. Who are you speaking to? Do you think they will listen?

I'm talking to you.

Preaching to the choir usually just bores them eventually, that's the sort of stuff for a blog.

Not everyone knows about this.

[Revi]

I think those of us who have known about peak oil for over 15 years have been lulled to sleep by the many times that the peak and decline has been called. Eventually we will run out of rabbits to pull out of the hat and the decline will start. A lot of these "enhanced recovery techniques" will fail when we start to decline because they are in effect subsidized by the easy to get oil. Things like tar sands has such a low EROEI are hard to get if the price drops, and it might be better to just use the Mackenzie Delta natural gas instead using it to cook tar into an oil-like substance.

Check out Gail Tverberg's graph of future energy production. It's pretty scary, and it could be true, unfortunately.

[Pops]

You gotta remember that what we consume are not simply BTUs, nat gas is not a direct substitute for oil and certainly not a drop in replacement. It doesn't run in my pickup for example, which likes diesel. So really it doesn't matter a lot if you net out 75% of energy inputs (conventional net crude oil - unleaded) or 50% or -50% as long as the final use is economically worthwhile.

EROEI doesn't matter as long as Moola Returned On Moola Invested remains positive.

The energy return on a typical American's 36 miles per day, 365 day per year energy investment in driving I'd venture is hardly positive yet it continues and has for some decades because it is economically positive.

[Dybbuk]

I always hear the same refrain from industry insiders: EROEI doesn't matter, all that matters is price.

Where EROEI matters is when considering the endgame. Maybe it doesn't matter so much now, when gas and coal are plentiful and can be used willy-nilly to help produce more liquid fuels. But in a future where all forms of energy are scarce, a low EROEI fuel falls prey to zero-sum, robbing-Peter-to-pay-Paul dynamics.

[Revi]

And that ethanol has wrecked many of the small engines that might actually be useful in a post peak world. I think we are going to be able to afford to do things that get us more BTU's in the future. For example if I use my pickup to drive up to my woodlot to get a half cord of wood and then cut it up using a pint of gas, that is overall very positive in terms of BTU's. If I use that same pickup to drive a hundred miles for a shopping trip, then that is negative. (unless I trade or barter enough stuff to make it worth the trip). I read about local farmers, and they would always tuck some butter under the seat of the car, or fill the trunk with stuff to trade. Then they would make the most of their weekly trip to town. We don't even know what that means any more.

[Pops]

Does EROEI matter to a baker?

No, he is not in the energy business, he is in the making bread business. Even though his customers buy his product for the energy it contains, at least in part, GROGI (greenbacks returned on greenbacks invested) is what he is all about.


Ethanol is the perfect example Pete. MTBE was outlawed and Ethanol was originally the replacement. It wouldn't matter if ethanol was a energy sink, it's job was an MTBE replacement oxygenator. So like using nat gas to make syncrude because syncrude is more useful, diesel, etc is used to make ethanol because it is more useful than diesel. (the blending mandate is a different story)

[Subjectivist]

Revi I am always reminded of the Amish.

The picker operates on gasoline but is propelled by horses. High torque/low-speed to pull low-torque/high-speed to pick.

Many, but not all, Amish farms make arangements with modern conventional neighbors to do the plowing and harvesting in exchange for cash or labor. The majority of Amish farmers now have people working in the 'English' world earning money to buy things in addition to their farm income. Some strict traditionalists still do a lot of horse/oxen powered plowing and harvesting, but the number is smaller every year.

[Subjectivist]

I wonder how they rationalize that? Where do the Amish get the dollars to pay for the labor? Selling their grain? But that would exhaust the soil, their capital.

The ones I met in Indiana not only sell their crops, they gave jobs in town working in the 'Amish Furniture' factory and many of the single women work as sales clerks of other service type jobs at businesses around the town. By hiring modern neighbors to do the plowing and harvesting they free themselves up for the factory jobs. Just because they do not have electricity or cable TV doesn't mean there is nothing to buy. They purchase livestock, property for their children to farm when they get married and need their own homes, muscle powered machinery, books, pretty much anything you would have bought in 1915 if you lived in the countryside instead of in the big city.

[Revi]

It makes sense to use fossil fuels for things like agriculture. What doesn't make sense is being a "soccer mom". We are going to need to use gasoline for things that get us more food and warmth. Unfortunately we are probably going to use it up going to the mall.

[ralfy]

With low energy returns, one can only have things like huts, animal-drawn farming equipment, etc. For houses made of cement, machine-driven farming equipment, white collar jobs, passenger vehicles, etc., high energy returns are needed.

[Revi]

I agree, but that is what we are going to be stuck with, and maybe sooner than we think. Rural areas are already in trouble, and it's going to get worse. Nobody has had money to invest in agriculture for 50 years now. Where is it going to come from post peak? Who knows?

[Tanada]

Check out this data posted on peak oil barrel dot com, five of the top 12 shale oil producing counties in North Dakota are losing money hand over fist at current prices, and have been doing so since early this year. A few are still making a good profit and several others are in the wishy washy margin area where they make money some weeks and lose money other weeks depending on how things are going. I know its much more complex than the raw numbers because sales are hedged and so on and so forth, but I think the numbers paint a bleak picture for many counties going forward as those hedges expire.

[GoghGoner]

List of spot prices:

Upper Rocky Mountain Spot Crude Oil Prices
WTI and N. Texas: $41.04
Colorado Western: $31.53
CO North Central: $35.76
WB Mixed Sweet: $35.88
ND Light Sweet: $33.74
Wyoming Sweet: $35.94
N Wyo. / S Mont.: $34.30
Spot prices updated Sept. 15

Oil production by county.

MCKENZIE 132,780,137
MOUNTRAIL 95,520,809
DUNN 64,079,402
WILLIAMS 56,034,126
DIVIDE 14,941,969
BOWMAN 8,134,837
STARK 7,331,357
BURKE 6,516,225
BILLINGS 5,413,591
BOTTINEAU 2,658,053

[Subjectivist]

Looking at the two sets of data it looks like most of the fastest producers are also the lowest cost, but not all of them.

To me that looks like the sweet spot effect written so clearly nobody should miss it. There were always some known sweet spots where shale drillers could make a profit on a vertical well Fracked once in the pay zone. Horizontal multi Fracked bottle brush wells are enormously more technically difficult to drill and complete and thus much more expensive.

At current sale prices we will lose those four counties that need $80+ to break even for sure. Unless the government swoops in and finances the wells that are losing money they will all close down within the next year.

[ROCKMAN]

Dave - By all means: "I am a river to my people." LOL.Points if you know the movie I stole that line from. The greatest movie ever made IMHO.

[onlooker]

http://www.cbc.ca/news/technology/oilsa ... -1.3237239
Just thought I would throws this about about limitation to production relative to water. Like this quote " The oilsands industry needs 3.1 barrels of fresh water to produce a barrel of crude oil from oilsands mining" according to the Canadian Association of Petroleum Producers. So I was wondering how others see the limitations imposed by water on oil production?

[Tanada]

Chris Martenson interviews Kurt Cobb in his latest YouTube/Podcast and I think you should all listen/watch it.
MONEY CANNOT MANUFACTURE RESOURCES
https://youtu.be/uZtEIOUR6L4

Explanation for what is actually going on in the fields and who is still drilling for LTO are given.