Rob Hopkins of Transition Culture writes:
At last night’s Food and Farming in Transition evening at Dartington Hall, of which I shall write more soon, Chris Skrebowski, editor of the Petroleum Review and author of the Megaprojects reports, gave a talk which used a Powerpoint which he had to zip through quite fast. … here is Chris’s presentation, an opportunity for all you peak oil anoraks to update your presentations with the latest graphs!
BA: Below is a text transcription of 9 of the 24 slides.
Chris Skrebowski: Trustee of the Oil Depletion Analysis Centre and
Editor of Petroleum Review, Inergy Institute, London
—
Who am I?
- Chris Skrebowski has spent half his working life in the oil industry and the rest as an oil journalist
- Free of corporate or political pressure he brings a healthy scepticism to the problem
- Not pessimistic by nature, not anti-Oil
- Basic approach to Peak Oil analysis
- Don’t guess, assume or hope – let the numbers talk
- Observe what companies do, not what they say.
So what is ‘Peak Oil’?
- It is the point when further expansion production becomes impossible because:
- New production flows are full offset by production declines (depletion)
- You never run out of oil
- You do run out of incremental flows
- The world needs oil products to support growth
Latest BP statistics show Peaks are already happening
- OECD production peaked in 1997 and has now declined by just under 2 million b/d (8.8%)
- Non-Opec, non-FSU production peaked in 2002
- North America/Mexico peaked in 1997
- North Sea – UK/Norway/Denmark peaked in 2000 now declined by 1.2 million b/d (19.2%)
- Around 25 significant producers in delcine
- About 35% of global production from decliners
The practical realities
- The world needs oil production flows
- Consumers need deliver flows
- Reserves are only useful as flows
- Peak oil is when flows can’t meet the required demand
- Worry about flows not reserves
- Many talk of reserves and forget flows
Seven key pieces of evidence suggesting we are close to Peak
- Falling discovery rate, few large discoveries
- Increasing number of countries in sustained depletion
- Companies struggling to hold production
- Non-geologic threats [to] future oil supply
- The current lack of incremental flows
- Few countries with real growth potential
- Sustained high oil prices
A simple observation – or why peak will be earlier than most people expect:
“Global production falls when loss of output from countries in decline exceeds gains in output from those that are expanding.”
Post-peak we are going to need other energy sources – Opportunity
- How fast will supply decline post-peak?
- Possibly around 2-3% / year like the US onshore but initially at just 1-2%
- But, it could be much faster
- Suppliers could anticipate, ration out supplies, delay peak and force adaptation
- Some might use military strength to commandeer supplies
My conclusions at very best
- Supply will remain tight and prices high barring a major economic setback
- Oil supply will peak in 2011/12 at about 92-94 million barrels/day
- There will be [be] supply shortfalls in winter before Peak
- Oil supply in international trade may peak earlier than the oil production peak
- Aided by CERA’s optimism we are still in denial
- There are huge challenges and huge opportunities
