Wednesday, May 5, 2010

Let the hollow media optimism sound a warning

Occasionally you come across an anti-peak-oil polemic that’s so self-defeating that it makes you wonder if our problems might not in fact be a lot greater, and more urgent, than you had previously considered.

A column in Tuesday’s National Post newspaper,Oil is not the enemy, falls into that so-bad-it’s-good category.

It starts off in the usual way: using the suggestion that there might be something in that notion of peak oil (as “fossil fuels are a finite resource”) to open you up to the sucker punch – in this case, that we have eight decades of fossil fuels in reserve.

Yes, 800 years. To quote directly:
But what if there is actually enough fossil fuel lying around to last up to,
say, 800 years, even factoring increased demand from emerging economies and
population growth. If that's true, and just as many people believe that idea as
they do peak oil, why bother with alternative energy at all? It's costly. And
judging by the headlines, no one wants a wind farm in their backyard. Moreover,
we're in the early stage of an economic recovery that is still quite fragile. We
need cheap conventional oil more than ever.

This, then, is the mother of all denial stories. In a stroke we have reserves stretching out pretty much to the next millennium, along with a list of the problems faced by renewables, and a call to do our bit to aid the current economic recovery. By burning more black gold, of course.

While the piece does mention geoscientist M. King Hubbert’s model of oil depletion, it doesn’t mention recent peak oil reports such as the British government’s behind-closed-doors meeting on the predicted energy crunch that’s five years away, or the US Joint Forces command’s Joint Operating Environment report suggesting that the military needs contingency plans as surplus oil production capacity could disappear within two years, with serious shortages possible by 2015. ("By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 million barrels per day.")

Instead it lists a slew of great new oil deposits recently found – which are either oil sands or deepwater. It does not mention the difficulties we are having extracting both. The Canadian oil sands are falling well behind projected outputs, as I've previously reported, and deepwater is in something of a crisis of confidence following the Deepwater Horizon explosion and subsequent 130 mile (208 km) by 70 mile (112 km) oil slick in the Gulf of Mexico. California Governor Arnold Schwarzenegger and the Canadian government are both making moves to distance themselves from deepwater drilling in their neighbourhoods.

Never mind that. What I need to know is where these claims of centuries of hydrocarbons comes from:
One more optimistic estimate predicts we'll run out of oil sometime before 2150,
followed by gas around 2300 and coal sometime near the 25th century. All told,
there's enough fossil fuel in aggregate to last about 300 years. Put another
way, that's enough to keep the next 10 generations going. And those estimates
don't factor in the huge potential of unconventional gas reserves such as gas
hydrates found in Arctic permafrost and geopressurized gas that is 10,000 to
25,000 feet below the earth's surface.

Ah, optimists! And anonymous, guessing optimists at that. Possibly the author of the column, because it isn’t attributed. (In journalism, if it isn't attributed, it didn't happen.)

For a start, the numbers don’t add up. The author quotes from the most rosy official estimates of oil reserves he can find, BP's Statistical Review of World Energy 2009, that there is “enough to last 42 years at current growth rates.” How do we go from 42 years to 2150? Shouldn't 2150 in fact read 2050?

Actually, that doesn't bother me, because we will never run out of oil. There will be oil remaining in the ground for as long as there is a planet Earth. This will be the stuff we can’t get at – extracting oil is constrained by economics. (Peak oil is not about extinction, it's essentially about peak cheap oil; the point at which oil becomes so expensive we have real economic problems.)

In addition, I am at a loss to substantiate the claims about the future prospects of gas and coal.

Many believe North America is alarmingly close to both peak natural gas and coal. According to
Exxon Mobil Corp.'s chief executive Lee Raymond, "gas production has peaked in North America."

Others give it a little longer. Studies by economist Douglas B. Reynolds and Marek Kolodziej, of Boston University’s Center for Energy and Environmental Studies, suggest “a peak in North American natural gas supplies could happen in 2013.”

And as for coal. . . Research in 2009 from the University of Newcastle in Australia concluded that global coal production “may well peak as soon as 2010.” Overall, it concludes, production will most likely peak “between 2010 and 2048.”

And the US has already experienced a peak in its high grade coal: anthracite in 1914 and bituminous in 1990. The nation is now concentrating on low-grade subbituminous coal. And imports. (In fairness, I have to say Hubbert suggested the US would hit peak coal in 2150, but others have brought that date forward a little.)

I’ll come back to peak gas and peak coal in a later post, because these are so important. For now, let me say that they are possibly cause for greater concern than depletion of oil supplies, because they generate the bulk of our electricity. As central as oil is to our economies, nothing in our modern world works without electricity. If the grid goes down, we are into survivalist territory. And if we find ourself facing massive declines in natural gas and coal right when we are struggling to come to terms with the collapse of oil - and our oil-reliant economies - then the grid will go down, in most parts of the world. Without access to oil, coal and natural gas, because we can't afford them, we are back to scratching a living in the dirt. (It might be different if you are living underneath a windfarm, but then, do you really believe politicians and the military won't move themselves in, and you out?)

Perhaps I’m spending too long refuting this silly piece of journalism. I know it’s a politically motivated column in a paper with its own agenda. But it’s not a one-off. This is what passes for debate on our energy security in the national media. And if nothing else, the fact that these clearly biased pieces keep coming out, telling us that we have nothing to fear, actually makes me alarmed. After all, there’s nothing like being told there’s no cause for panic to make you start to wonder if the shit isn’t about to hit the fan, big time.

Despite what the optimists tell you, oil, natural gas and coal are not just a market issue, they are central to our energy security. It’s too big an issue to be left to the markets. And, I contend, one day soon, it won’t. (You could argue that the US military involvement in Iraq and Afghanistan proves that we have started down that road already.) I envisage a future in which governments will take direct control over energy allocation, ranging from rationing to confiscation of resources. But that’s something for a future column. . .



Forever and a dayEconomy picks up with service sector growth, more home contracts

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