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Sunday, December 11, 2005

Production Peak - The Bottom Line

I'm a reader.

Love it... read everyday.

And from a wide variety of sources from fiction, to history, to historical fiction; & more recently technical papers on the geology of oil production & exploration of all things.

Like many of you, I'm more than a little interested in this idea that the midpoint of conventional hydrocarbon production looms near.

After 2 years of studying everything I can find on peak oil, I have distilled what I think are the most significant & compelling arguments regarding oil production.

As always, my friend Billy of Occam leads the way thru the foggy waters of reality.

And it goes something like this:

The determination of exactly when midpoint conventional oil production will occur hinges on exactly how much oil we can find & produce.

Our knowledge of estimated "known and probable" oil reserves rests with OPEC & the major oil companies.

There is significant financial advantage to OPEC & the oil majors in overstating their reserve estimates.

Which is the same as saying that OPEC & the oil majors are overstating their reserve estimates.

Since even the USGS predicts that conventional oil will eventually peak & decline around 2030, these over-stated reserve numbers shrink their estimate for peak.


It's really a question of just how inflated the OPEC & oil majors reserve reporting really is.

It's not hard to imagine that the world's oil producers have grossly exaggerated and the actual peak date is long since passed.

At the very least, it means that the 25 year window the USGS claims is fantasy, and the actual date will be much sooner.

What sounds more reasonable to you?

The major oil producers voluntarily gave up profits and made accurate reserve reports because it's the right thing to do?


The major oil producers inflate their reporting numbers to maximize profits regardless of other considerations?

Is there even any question?


WHT said...

So I take it that either you didn't read Michael Lynch's material or you did read it but broke out laughing.

Aaron Dunlap said...

Pretty much laughing... & crying.

WHT said...

Frustrating and maddening, I agree.

Aaron Dunlap said...

He does make some valid points on the forum IMO.

But does not really fully consider the reality of how business gets done... or at least that's the impression he creates.

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alberthaanstra said...

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Regards, Albert krediet

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Van Leeuwenhoek Lyceum, Hoofddorp.