You're freaking out trying to come to grips with the fact that you don't really know what you're talking about (on this subject, anyway), as the last two posts of yours confirms.

If true, you have painfully limited acceptance of the basic laws of thermodynamics, it would seem.

Que? Dude, not being lazy. Just asking you to openly stand by your graphic. You're the one being lazy. ... Because... sure enough...

From your own link:

The survey’s 129 respondent companies accounted for more than $700 billion in 2013 revenues, and almost $100 billion in capex expenditures. Half are headquartered in the U.S., half in other countries. The survey was conducted online between Nov. 27 and Dec. 9, 2013.[/quote]

Yeah, dude, your 129 companies combined had $100 billion in capex. Those weren't the oil majors I presented in the OP, for which we're talking about more like $300 billion among 5-6 giants (now suddenly dropping). I never disputed the idea that smaller companies would fill some of the void and try and pick at the carcass a bit. But they're not the majors. And they don't produce as much as the majors, and won't make up for the majors' inevitable decline to come, and soon.

They'll mostly all learn, if they're not fully aware already, what the majors learned. Tight oil extraction is not profitable, long term. Not the medium term, for that matter.

FYP

lawl. ... Surely the failing global economy can continue to afford the rising prices necessary to make "the dream" come true.

"We are all losing our shirts today. We're making no money. It's all in the red.” - Rex Tillerson, CEO of Exxon Mobil

naw, you're right. ... x5, actually



LOL... this is the part where I knew you had very limited understanding of the energy:economy relationship, and very little idea what you're talking about regarding this subject matter in general.

In a painfully simplistic analogy, the kinds that "vroom vroom" people like you might attempt to make, maybe.

No, Hubbert's Curve has been refined, not wrong. Petty quibbling has arisen over the years, usually from economists. Your argument here is a little like saying 17th century map makers "had it wrong" when they present work that looked like this:



Learn how to make an analogy, if you're going to use one. And stop being dishonest about what Hubbert ever actually said. Even in its primative form, his work absolutely made concessions for delays in the peak model due to efficiencies and transitions. A decade or two, at best, which is what we've seen.

Quite obviously more so than you.

LOL... right. Surely, the infrastructure is all in place, and won't ever have to move, be maintained, or expanded in order to meet demand growth. They've got their straws in the ground, and now they're all collectively ready to start sucking the black gold right on up!!! It's all "in the black" from here on out!!

Holy crap, dude. You're woefully uninformed on this subject. Might want to sit the next few plays out.

So, despite the credentials listed, you're suggesting that man might be "stupid, prejudiced or controlled?" If he were being manipulated, I have a hard time understanding why he'd be outing the uncomfortable reality his former industry now faces. Wouldn't he instead be some kind of mouthpiece for it?

Please don't tell me it's gotten so bad in discourse today that "experts" has become a bad word. No, I'd say that man's data is gold, if anyone's in the industry's is. I've yet to see anyone even attempt to refute his forecast models.

Are you watching the same news the past 5-7 years I've been seeing? The EU almost broke up, for goodness sake. U.S. investment banks nearly collapsed and had to be bailed out due to corrected asset value and very sudden low liquidity. And Arab Spring? It has as much to do with food price (based on oil price) as any other main cause.

Heck, why do we think the Fed Funds Rates always tended to spike with oil price spikes? (before Bernanke, anyway)

Watch the presentation. Kopits draws it out far better than I might. But I'll try if you won't watch: What we've learned over the past 6-7 years is that oil price seems to hit up against a $100 (WTI) ceiling. Several times now. ... Unfortunately, societies begin to break down beyond that price, and demand begins to truly be crushed. Certainly in the West. Meanwhile, oil majors are declaring they "need" today's price per barrel costs closer to $140-150 in order to maintain free cash flow.

They don't subsidize their industry like we do. Also, what's their military budget?

Because oil price is about far more than the cost of gasoline at the pump. Oil price affects almost everything. Including, and especially, our global food processing conveyor belt, and its "just in time" packaging and delivery system.

Well, using GDP as a metric here is your first mistake, in my opinion. Especially considering that stuff like billions in disaster repair contributes to overall GDP. (Those continue to rise, btw) ... A fairer metric would be something that includes "externalities" like that in the correct column.

Do you honestly believe that Europe is currently "ticking along just fine?" I don't.

It was a survey! When they say 9 out of 10 dentists prefer Crest, they don't mean that they got every single dentist to respond.

I erased all the parts where all you did was say "nuh uh" without actually making an argument.

The global economy is recovering, not failing.

You posted an article about them losing money on natural gas because there is oversupply as evidence of them losing money on oil?!?

You do know that XOM is profitable, right?!?

Capex is not cost of production.

Capex of companies that don't just get oil out of the ground is not even capex of oil production of those companies.

Also, they really put BG as an oil company?!? It is a natural gas company. It isn't an oil company at all!

ENI?!? 48.5% of their energy production (boe) is in ng.
BP?!? 44%.
COP?!? Only 39% of their boe is in crude.

Should I go on?

It has not been refined. It is still x = 1 / (2+2*cosh(t))

It never worked. The formula predicts a rapid rise and then a rapid drop. That has never happened. Not even once.

No, what we have seen is that Hubbert's Curve has just been wrong. The energy crises we have had have all been because of purposeful supply restriction, trade policies and price controls, and political turmoil.

No one paid him any more attention than we stopped screwing because of Malthus.

You will note that it is incredibly difficult to find any industry or policy experts who consider peak oil to be a viable way of looking at the world.

I have. They have nothing relevant.

You seem to be running on the thesis that it's total energy that matters, and that petroleum by itself is largely irrelevant. That's just lazy thinking man, and wrong.

I agree that total energy peaking is centuries to millenia away. But that's irrelevant. There is no alternative to oil right now for large scale transportation fuel, and there won't be without a 20 year lag time and significant conversion pain.

If oil peaks, we are ****ed, period. This not some doomsday crap. It is a considered opinion of many smart and knowledgeable people. For example, read the Hirsch Report. It is not something you can sweep under the carpet and say "total energy is fine, so don't worry".

No it isn't - it's a standard and well respected theory on the supply curves of finite extractable resources.

It takes all of that into account. It's a simple and robust combination of maths, and the nature of extraction and economics on finite supply. It's essentially a throughput/bandwidth curve for a particular type of commodity, and it maxes out a very long way before the available reserves are exhausted. It's a way of saying: "Given reserves sufficient for a linear supply of X years, maximum throughput will occur at Y years, where Y is very much smaller than X, and differs by commodity.

This is a very solid graph, IMO. It's from 2004:


The quadrupling of price since that graph has extended the run for a while longer as uneconomical elements are brought online with massive capex. But how long will those less economical supplies last? What is their capacity and cost? What are their Hubbert curves?

Until you can answer those questions, you have no basis for rubbishing the idea of peak oil.

Yes, that's why oil jumped from $30 to $120 in seven years, and stayed there. All price controls and political turmoil; nothing to do with fundamentals.

Have you paid any attention at all to OPEC in recent years? They have melted away. No more supply cuts as oil is already higher than their targets. In fact, they can't increase supply enough to keep up with demand.
You pretty much discredit your entire commentary when you make statements like this. The Hubbert peak is well respected for the resource industry, as mentioned above. The Hirsch report is a report prepared by policy experts for the industry watchdog.

When you strip away all the bluster, the following are the facts:

- There is no viable alternative to liquid fuel without extremely high economy wide conversion costs (something that might not even be possible in the rest of the world, causing global shock). This will take a 1-2 decades in the technologically advanced world
- Easily pumpable crude is almost at, or has just reached, its Hubbert Peak, and is in terminal decline.
- Unconventional will have to ramp up significantly in volume to offset the decline
- Unconventional is substantially more costly than light sweet crude, requires astonishing levels of capex and significant manpower, and is an environmental disaster.
- None of these facts are in dispute.

So the question is, what are the supply curves/Hubbert peaks for unconventional? The following questions need to be answered:

- What is the cost of coal or gas liquefaction on a large industrial scale (tens of millions of barrels)?
- What are the costs and supply limitations of oil sand mining?
- What are the costs and supply limitations of shale oil mining?

From what I can see, the first two are viable on a large scale at over $80/barrel, and there are sufficient supplies to offset light sweet crude decline. However, they require large amounts of energy (the product has to mined, transported to the processing station, and then heated to 400 degrees celsius), insane amounts of capex with a long lag time (many years), and are highly polluting.

So I don't think peak oil is imminent given that there are two sources of unconventional that can be extracted in sufficient quantity at under $100/barrel. We certainly do mining and smelting with iron ore on a similar scale as that required for unconventional; a billion tons of pig iron are produced every year from 2.5 billion tons of ore, which is a solid substance mined out of the ground and then heated to high temperatures. In terms of barrels, that's about 16 million barrels/day.

So unless Jiggs can show why these sources are unreliable or unworkable on a large scale (shale oil certainly is, but there are two other sources), then I think he's lost the peak oil debate.

I can find other experts who completely disagree with him. Many of them, in fact. What worth are individual experts if I can find a highly credentialed expert to back any position I wish to hold?

Due to excessive opaque gambling (derivatives), and poor asset allocation (subprime mortgages). It had nothing to do with oil.

I agree you're probably right on the face of it, but do you have any data to show this? The food price index more than doubled since 1999; do you have any data as to cause? Supply/demand for a rapidly growing world, biofuel competition, and increasing use of artificial means on increasingly marginal land, could do it too.

Why do you say this? I don't see evidence for it.

Given large upfront capex for unconventional. But that's a temporary shock. Everything I've read is that large scale unconventional production is possible at ~$80/barrel long term, and possibly less once the process is improved.

Yet, it's gone up 300% in ten years ($30 to $120), and all of those things are still running. The system absorbed a massive shock, and kept running. Trade is higher than ever! JIT is used even more than ever. Food production has gone up reliably. Given that the price can go up 300% and still function perfectly well, why do you think it can't go up 30%? I truly struggle to understand the logic.

GDP isn't everything, but it's a rough measure of the free energy of a system.

Take a 1000 mile view here. The free energy of a system is what matters. The energy required to obtain inputs to that system diminishes the free energy of a system. However, given that oil is a sub 1% fraction of available free energy, why do you see it being so dire if the cost goes up a bit?

If we were going from say, 5% to 10%, that might be dire. But sub 1%? How is that so terrible that it brings it all crashing down?
Europe has a bunch of socialist clowns and a dumb currency system that goes directly against basic economic theory (e.g. Adam Smith). The trouble in Greece, etc is due entirely to that dumb currency system, as there is no mechanism to punish the results of laziness, corruption and socialist thinking, so they grow until the country collapses.

It's a clown show for sure, but despite the weight of bureaucracy and massive theft and manipulation and undermining by the world's largest criminal enterprise (China), the key economies (Germany, UK, etc) are doing just fine, in fact well enough to subsidize the lazy, the commies and the corrupt.

None of this has to do with oil.

There's a pretty compelling case for that, yes.

I'm pulling a lot of this from here (I'll call it link 1): http://www.eia.gov/forecasts/ieo/pdf/0484(2013).pdf

Page 15 discusses world transportation usage.

Page 23. Figure 30. Shows world petroleum production (actually broken out from other liquids) growing through 2040.

Link 2:
http://energypolicy.columbia.edu/sit...2-18-13%29.pdf

Expected energy use by source on slide 26.

It doesn't appear to be the case that anyone is worried about production dropping.

I gave the formula for the Hubbert curve.

It predicts a rapid rise and a rapid decline. It predicts nothing but a rapid rise and a rapid decline.

That is a very nice example of the Hubbert curve not working. Production is supposed to go up, peak, then crash. It didn't.

I'm not rubbishing it. I'm listening to the actual experts. The IEA, the EIA, the production companies, etc.

As far as explaining the price moving around? No, I can't. I'll get back to you once I get my head around the price of gold, Nasdaq composite, bonds and housing over the last few decades.

OPEC is doing fine (and yes, I pay attention to them). OPEC was doing what any decent business group would do, which is not flood the market but supply enough that it isn't worth competitors coming in. They have always had excess capacity (and they can increase capacity if they wanted to):

http://www.euanmearns.com/wp-content...n_capacity.png

Yes, and this was prepared by experts for our military: http://www.lfr.org/lfr/csl/library/airreport.pdf

Yet somehow the energy agencies and the production companies say that Peak Oil is wrong.

The IEA:

"Where does the IEA stand in the peak oil argument?

Our analysis suggests there are ample physical oil and liquid fuel resources for the foreseeable future. However, the rate at which new supplies can be developed and the break-even prices for those new supplies are changing. Global oil production levels are also dependent on the production policy of OPEC, which holds between one and six million barrels per day of spare capacity in reserve. Declining oil production in any given year can occur for one of several reasons unrelated to peak production, including OPEC production decisions, unplanned field stoppages and the impact of earlier investment decisions by the oil industry. A combination of sustained high prices and energy policies aimed at greater end-use efficiency and diversification in energy supplies might actually mean that peak oil demand occurs in the future before the resource base is anything like exhausted. "

Since that is quite the paragraph, part of the important bit is in the last sentence where they mention demand, diversification into other fuels, efficiency.

The EIA has world oil going up through 2040, which is as far as they project out.

That would be important if the whole peak oil thing would happen. We actually do have to worry about temporary shocks crushing us. I'm very pleased that the US has finally gotten its butt in gear to be an energy exporter. That gives us leverage.

Also, we could do the whole CNG, LNG, NG to other liquids, coal to liquids, or biofuel thing if we had to. Better off if we can take our good old time though.

The EIA is expecting total upstream investing worldwide to be $700 billion. They are also expecting that OPEC (which still has a crap load of fairly easy oil) and Brazil to be able to increase supplies substantially over the years.

Keep in mind that the "you have to get it transported to the processing plant" is true of light crude as well.

Price of getting crap out of the ground (and, lol, their break-even price includes a 9% return!):
http://www.gbm.scotiabank.com/Englis...n/bnscomod.pdf

Peak Gold theory?

Peak Housing theory?

Peak Nasdaq theory?

If NASDAQ were allowed to do what OPEC is allowed to do, they would.
We sent A Alfred Taubman to prison for what OPEC was designed to do and does every single day.

Pretty sure oil actually beats diamonds for the most deliberately manipulated market.

lol fail. Nearly every paragraph.

This will take some time, and I have a busy Sunday/Monday ahead. But I'll be back to respond to every claim above and show how clueless Mick truly is for anyone not yet convinced already.

For now, in short:

- Supply volume says absolutely nothing about production rate, even when you redefine what constitutes supply. If you have an ocean of oil, but only a couple straws to get it to to surface and to market, you're not going to meet demand quotas, even if you add one new straw per month.

- The IEA paragraph you quote doesn't say what you think it says. You may wanna read it again, and focus on what peak oil actually means, not the straw man you've created about it.

- OPEC does not have a "crap load of easy oil," by any reasonable definition, up against modern demand volume. Nor does it have anywhere near 6M in spare capacity. Much closer to 1M, which is crisis-level low. Do you even understand what spare capacity means and entails? Probably not.

- watch the presentation; stop lying about what known data actually says.

also, most striking:

You seem to be forgetting austerity, TARP, QE I, II, II and countless other bailouts, as well as cheap global credit around every corner. Where do you think we'd be today without the mind-boggling levels of fiat currency and borrowing in order to "keep it all running?" ... None of those things are sustainable (even in the short- to mid-term), and none of them produce energy, which actually does the work.

And yes, all of the things you mentioned that seem like direct causes of the 08 crash (including Wall St. gambling and real estate bubbles) have everything to do with rising oil price affecting global asset values and available liquidity.

Yes, I do know what spare capacity means, and I gave the actual number from December 2013.

I did watch it. I even downloaded all the slides, which were horrifically misleading.

Campbell is gonna get that year right someday!

Also, petroapocalypsenow.com!!! Priceless.

Nice slipping in the word "fiat" as well. I appreciate that. Won me $20!

I'm done now. As I care more about the $20 than I do about arguing with a doomsday person, you can have the last word so that we both can win and you can go back to building your bunker!

Miss the point much? Or is this your way of running for cover?

You're referencing 129 small companies that pick off the scraps of the oil majors and amount to $100B in annual Capex. I referenced the 5-6 industry leaders (and pioneers of the technology) that amount to almost half of world total capex.

Oh, I'm quite confident I'm making a substantial argument throughout, and it literally has you bailing from the thread.

So, no, what you erased was my statements reminding you that small companies aren't the oil majors, and small companies won't make up for the inevitable decline to come as a result of substantially reduced investment by those majors.

Probably a good idea to "erase" that intrinsic aspect of my argument when you don't have a real response to it.

LOL ... the U.S., or the globe? Either way, just from today, alone:

China Takes Sides: Sues Ukraine For $3bn Loan Repayment

Minister of Agrarian Policy and Food of Ukraine Igor Schweich confirmed that China has filed a lawsuit against Ukraine in a London court for the return of a loan of $3 billion.

'The New Normal' Has Been Devastating For America

It has been devastating, harming both current and future generations. Just witness the extent of long-term joblessness and youth unemployment, as well as the excessive increase in the inequality trio (of income, wealth and opportunities). It has also contributed to political polarization and weakened global policy coordination on economic and geo-political issues.

Petrodollar Alert: Putin Prepares To Announce "Holy Grail" Gas Deal With China

"The worse Russia's relations are with the West, the closer Russia will want to be to China. If China supports you, no one can say you're isolated," said Vasily Kashin, a China expert at the Analysis of Strategies and Technologies (CAST) think thank.

Rio de Janeiro to get federal troops to quell recent violence

The government in Brazil says it will send federal troops to Rio de Janeiro to help deal with a spate of violent attacks targeting the city's police.

On Austerity Chopping Block, Students & Faculty Occupy University

Facing mass lay-offs and program slashes, University of Southern Maine faculty and students demand 'human right to education'

No, I posted a link showing them not able to make money unless the consumer price is much higher. Short-term glut in storage is irrelevant. Wake up, dude. It's the same for tight oil production as well.

Sure, as long as they're not having to expand production quotas in order to meet insatiable demand.

The graphic refers to crude oil spending. The discussion is about the economics of crude oil production. Your NG tangent matters little, as I'll remind you again, NG isn't oil, doesn't burn as efficiently as oil, and doesn't provide all the things and functions that oil supplies. And the global economy doesn't hinge on NG prices. Tooth just schooled you on those facts, so try and focus.

So much for that claim:

BG Group and partners strike oil offshore Kenya

BG Group plc is a British multinational oil and gas company headquartered in Reading, United Kingdom

LOL! ... You mean besides his prediction for U.S. peak for 1970 and decline thereafter? Or does that not count, among so many others?



Granted there's been an uptick since that point due to wholly unsustainable unconventional production, but no where near our production peak of 1970.

Nope. Not wrong, just delayed about 10 years due to a complete redefining of what the definition of crude oil actually is. His model always called for peak production some 40 years after peak discovery. That was the case for the U.S. (1930s), as it was for the world (1960s).

You don't know what you're talking about.

The only thing I will note is that you've been 100% wrong throughout the thread. This passage being no different.

It's not AT ALL difficult to find industry and policy experts (and chief economists/CEOs, for that matter) who heed the forecasts quite closely. In fact, they help provide them. Let's see, just off the top of my head?... There's Kopits from the OP, there's former CBC chief economist Jeffrey Rubin, former BP geologists Colin Campbell and Jeremy Gilbert, former Saudi-Aramco VP Sadad al-Husseini, Virgin Group founder Sir Richard Branson, former Former Secretary of Defense, Secretary of Energy and CIA Director James Schlesinger.

No. I'm gonna bet you don't. Link your claim on that 2013 number, including the passage you're trying to pass off as fact. Then we'll discuss context for what you think you have. Oh wait, you're "done here."

If you could qualify what aspects were "horribly misleading," you would have. This above sounds like ever more b***s***, and I think you know it. In any event, I'll trust the word of the managing director of an enormously successful energy business analyst firm over a poker forum blogger who can't even get basic facts straight.

Already has. Peak of conventional production arrived in 2005.

Here's where I know you're grasping at straws. You can't focus on the actual testimony, only the watermark regarding the video host. LOL-FAIL

I'm sorry. Where have I written anything about ANY doomsday scenario, oh great straw man champion? Is it so bad for you now that you have to create cartoons of your opponent, rather than dealing with the reality that is taking you behind the woodshed? Yeah, you should probably give up.

Ah well, run along then. We'll be here. Maybe you can come back when you find more selective charts that don't actually say what you think they say.

Jiggs, simple question.

Why is coal or gas liquefaction not viable on a large scale?
Why is oil sands mining not viable on a large scale?

There are truly vast quantities of each, and proven processes at current prices profitably producing hundreds of thousands (coal liquefaction) to millions of barrels (oil sands mining) a day.

Everything I've read has indicated that both of those sources are viable on scale large enough to replace any lost light sweet crude. The Athabasca oil sands alone contain 2 trillion barrels of oil (trillion!), with 180 billion profitably recoverable at current price levels.

These sands are already producing 1.6 million barrels per days and they cover a vast area, just below the surface, as accessible as regular coal:



Wiki says:
This one field alone, using proven technology and current prices, is gg peak oil. Why does this not destroy your peak oil argument? Given the vast area and the proximity to the surface, there is no reason this can't be scaled up 10x and be profitable at current prices. The process is proven at 2% of world oil production already.

Do you claim this can't be scaled up? Why?

Agreed. 100% correct.

The last sentence of which (and the OP) makes your $80/barrel claim (link please) somewhat meaningless. Externalities are always cost inputs, regardless of how cleverly some savy economist dismisses them from computation. That is, unless government regulation looks the other way.

In any event, you largely seem to get it, which is why your follow up post is so curious.

So your stance is that coal-to-liquids and tar sands production, as you see it, can and will make up the difference?

Should I begin with the economics, the logistics or the fact that they don't provide what oil does (which you've already admitted above)?

So find them. Bring them forth. I've likely heard of them. And then we can compare their credentials and arrive at sound judgement regarding their message. Let's do it. I mean, that's how I do it. I don't rest behind "pffft, experts."

Covered in previous post above.

As could soil erosion (due to nitrogen-based fertilizers). Supply/demand and biofuel competition have everything to do with oil price.

Anyway, the causation is rather clear to me:

World Bank Says Oil Costs to Blame For Food Prices



There is an hour's worth of evidence for it in the presentation from the OP. If you need more, I can provide that as well.

Then what are you reading? Links please. If they're claims by individual companies forecasting the economics equation so as to boost investment and stock value, I'll just stop you right here. ... Instead, look back at what they're spending. Because what we now, clearly from the presentation above, and links like this (Oil and Gas Companies Slash Spending as Foreign Investment Dries Up), investment is drying up, and costs need to be much higher than $80/bl in order to meet demand growth.

Answered above. I'll ask you again to envision a world where TARP and QE never were allowed to happen. Are we still "functioning pretty well?"

I see you ignored my assertion that derivatives gambling and real estate bubble had everything to do with the radical correction of asset value and decreased liquidity caused by the oil price spike, so I'll assume you agree 2008 had everything to with oil.

There's what appears to be your entire problem right there. You shouldn't adhere to "basic economic theory" in the first place, as it's riddled with flawed assumptions and logical fallacies.

Amazing how it all seemed to be working out OK until oil price ballooned 600% in 12 short years. Suddenly now, the entire EU needs German cash (and Russian gas) just to stay cohesive.

wow... I didn't realize Red Scare was a part of your platform.

I'm sorry, but you're wrong. You've been very respectful, but you're wrong. It has everything to do with it.

You seem to have answered your own question. If the industry has already made all that mess up there for all of 1.6M barrels per day, what do you think will be the logistics of expanding their extraction and production rates some 6-fold to get it to 10M? Seriously, be realistic here. This isn't some shallow giant pool of liquid crude like Ghawar. This is junk baked and power washed from rock. Strip mining, essentially. Saying there's a lot of it doesn't mean you can get it to market at a substantial rate.

Where are the pipelines gonna go to deliver it, when there's already so much push back for the one proposed line? Shall they just keep trucking it 2000 miles south? Where are the thousands of geology engineers going to come from? Where is the know-how and the man-power required to expand the industry that vast? Who's going to build the new refinery capacity for this crap, that's not actually oil, but a synthetic oil? How much does the environmental cost factor into this purported $80/bl floor? Likely none. My guess is the real cost of producing that junk, going forward, is a lot more than $80. That is, when all the real "externalities" are included.

After decades of trying, the bitumen process there is at 1.6M barrels per day. Color me unimpressed, and considering the environmental damage? Uninterested.

There hasn't been decades of trying. This stuff can't be produced on a large scale at $30/barrel, which was where oil used to be at.

So anyway, it seems to come down to answering the question: can unconventional sources fill the gap? Myself, knowing nothing about the industry, I see no reason oil sands alone couldn't easily scale up to 10 million barrels/day and more.

Each year, 7 billion tons of coal, equivalent to 30 billion barrels, or more than the world's oil usage, are produced by strip mining, carted by trucks, rail and conveyor belts, and their burning producing large amounts of toxic ash.

2.8 billion tons of iron ore are turned into pig iron each year, much of it transported long distances by ship, then processed by high energy high temperature smelting.

It's not like we can't or don't do the industrial processes or level of transportation already. It's not like mining on this scale doesn't already happen. It's not like pollution on this scale isn't already common. China is destroying their country environmentally, but their economy and production is doing just fine. And as bad as the environmental effects might be, the world has decided again that where necessity lies, the environment comes second. That's one of the surest bets you can make.

Anyway, as for the economics of oil sands:
I previously quoted the claim that 180 billion barrels are recoverable at < $80 barrel. Seems reasonable.

Unless you think these numbers are simply made up, it seems an open and shut case that there will continue to be sufficient oil available. Better technologies such as steam injection gets around a lot of the environmental problems as well, such as use of water, or above ground pollution. They work well, are cheaper, works for deeper deposits, and use 5-20% of the resulting oil's energy, which isn't a disaster. No doubt processes will improve in this area.

As for coal liquefaction, have a read of Wikipedia's list of commercializations.

As the price of oil rises, this becomes more and more profitable. To give an example, a 100,000 barrel/day liquefaction plant by Sasol cost $10 billion in Capex. At $20/barrel over parity, that would take 5000 days to pay off capex, or 13 years. These companies making these investments are presumably operating profitably already and think the capex worthwhile.

For a trillion dollars in investment - $100 billion/year for 10 years, at the current oil price + $10, we could have an extra ten million barrels/day of oil out of coal.

The sky is the limit here. It's limited only by capex, and is already profitable at current oil prices.

After looking at all this stuff, I think there is zero chance we run out of <$150/barrel oil in the coming decades given the economics and availability of unconventional supplies. There are so many avenues of attack to the oil problem, from gas-to-liquids to coal-to-liquids to oil sands to new shale technologies. None as good as light sweet crude, but they'll produce the same fuel in the end at close to current prices for a little more environmental damage and a little more energy wastage. There is nothing here that's shockingly different from what happens already, either in terms of total energy usage, workforce required, capex required, or environmental impact.

Jiggs-

i read through the first page of this thread

then realized it is 4 years old. 4 years later crude is @ $100.

why?

Because the public can't afford it any higher. And as the OP shows, that's a real problem for the oil producers who are now throwing in the towel for expansion.

This is peak oil. Sorry.

Lol peak oil.

We're busting at the seams around here (in NM) with new drilling, in an area where oil hasn't been drilled for in over 40 years. Even just a few years ago no one thought it could be done. Nitrogen and CO2 foam fracking technology is mostly credited, but the entire process is getting better, from drilling techniques, perforating techniques, new ways to monitor and map the targeted formations, proppant delivery, etc. There's a **** ton of oil in NM, CO, WY, UT, and northwest TX that is being drilled for at the moment, and will continue to be. I read somewhere before that there's a trillion barrels in this area alone.

I'd like to see a citation of whoever said you need $150/bb to profitably drill for oil.

LOL New Mexico...

700 million barrels in proven reserves, or what the planet uses in about 7.8 days. Doubtful half of that will ever be extracted, as foreign investment flees from unconventional extraction at alarming rates.

http://www.foxbusiness.com/industrie...l-rich-states/

I'm not an expert on what you guys are discussing, and I don't have a dog in the fight.

That said, I've worked in the Canadian Oilsands for the past 8 years. Currently there is more construction happening then I've ever seen before in my time working there, every major oil company from Shell, IOL, CNRL, Syncrude, Suncor, Husky, ConocoPhillips and a few others have major construction projects being constructed or about to start in the Alberta oilsands. These are all 3BN$+ projects, and as of right now there is no sign of it slowing down. Saskatchewan is suppose to have more oil reserves then Alberta.

I have no idea if this helps, I just thought Id share that has someone who has worked in the area for basically the past decade and through a boom and a bust. There is more work going on now then in 2007 before the bust.

why/how has this fact not been priced into the cost of a barrel of oil in the past 4 years?

- watch the presentation
- would you rather have recession, or stable oil prices under $100 (preferably under $75)? ... you can't have both, unless some magic new energy source comes to the rescue... tomorrow.