The Global Mid-Point of Conventional Hydrocarbon Production Aaron Dunlap PEAK OIL

What is Peak Oil?

M. King Hubbert In 1956 M. King Hubbert, a geologist for Shell Oil, predicted the peaking of US Oil production would occur in the late 1960's. Although derided by most in the industry he was correct. He was the first to assert that oil discovery, and therefore production, would follow a bell shaped curve over its life. After his success in forecasting the US peak, this analysis became known as the Hubbert's Peak. The amount of oil discovered in the US has dropped since the late 1930s. The amount of oil discovered in the US has dropped since the late 1930s. 40 years later, US oil production had peaked, and has fallen ever since. 40 years later, US oil production had peaked, and has fallen ever since. World discovery of oil peaked in the 1960s, and has declined since then. If the 40 year cycle seen in the US holds true for world oil production, that puts global peak oil production, right about now; after which oil becomes less available, and more expensive. If we apply Hubbert's Peak to world oil production we estimate that approximately half of all oil that will be recovered, has been recovered, and oil production may reach a peak in the near future, or perhaps already has.

The End of Oil? Peak Oil is NOT about running out of oil Peak oil contends that any finite resource, (including oil), will have a beginning, middle, and an end of production, and at some point it will reach a level of maximum output. Oil becomes more difficult and expensive to extract as a field ages past the mid- point of its life. With some exceptions, this holds true for a single well, a whole field, an entire region, and presumably the world. Peak Oil means the end of cheap oil.

Dr. Richard Smalley December 15, the most critical problem facing the world today is energy and finding new sources to support a population of 10 billion by Our present population of 6.5bn consumes about 14.5 Terawatts of energy, which is equivalent to 220m barrels of oil per day. By 2050 this could rise to as much as 50 Terawatts yet the world is likely to pass through its maximum point of oil production in a matter of weeks. Oil may simply be the best energy source man will ever discover.

Peak Oil is NOT a Theory...it's a fact. The Question is... when?

Predictions

The Central Issue

The Gap

Depletion

Rapid Depletion How fast will oil production decline post- peak? How fast will oil production decline post- peak? Historic data from oil wells shows an average depletion rate of around 3% - 4% per year. Historic data from oil wells shows an average depletion rate of around 3% - 4% per year. But will todays modern wells have a similar depletion rate to historic models? But will todays modern wells have a similar depletion rate to historic models? Maximum Recovery Extraction Maximum Recovery Extraction The price of maximum extraction however, is maximum decline rate after peak. The price of maximum extraction however, is maximum decline rate after peak. terminal decline in one or more of these fields would be devastating to the oil market practically overnight. terminal decline in one or more of these fields would be devastating to the oil market practically overnight.

Common Sense

Rapid Depletion

Campbell and Laherrère "About 80 percent of the oil produced today flows from fields that were found before 1973, and the great majority of these are declining." "About 80 percent of the oil produced today flows from fields that were found before 1973, and the great majority of these are declining."

BP Stat

World Oil Consumption

What effects will a decline in oil production have? At $2.30 per gallon as I compose this, Im confident I dont need to explain why higher oil prices are important to anyone. Just go get gas & youll know. At $2.30 per gallon as I compose this, Im confident I dont need to explain why higher oil prices are important to anyone. Just go get gas & youll know. If peak oil is truly immanent, then economic instability is a certainty. If peak oil is truly immanent, then economic instability is a certainty. If decline rates resemble recent rapid depletion examples, oils price will rise well beyond historic high prices. If decline rates resemble recent rapid depletion examples, oils price will rise well beyond historic high prices. If more than one of the super giant fields enters an aggressive decline… If more than one of the super giant fields enters an aggressive decline… It will be cheaper to run your car on gold bars than gasoline. It will be cheaper to run your car on gold bars than gasoline.

Lead Time The actual date of peak oil isn't important, what counts is the date preceding the peak, after which it becomes more difficult to avoid the worst consequences of depletion.

GAO Such a peak would require sharp reductions in oil consumption, and the competition for increasingly scarce energy would drive up prices, possibly to unprecedented levels, causing severe economic damage. While these consequences would be felt globally, the United States, as the largest consumer of oil and one of the nations most heavily dependent on oil for transportation, may be especially vulnerable among the industrialized nations of the world. Feb 2007

Impact 1974 OPEC Oil Embargo WWII US Oil Embargo