Ray's Peak Oil Notes & Links
Can we survive Peak Oil? Sure! But it won't be
easy.
It could be very, very hard without the right incentives and
assistance, which won't occur until the government recognizes the
seriousness of the issue. A lot will depend on how fast
production
declines. If it declines at a very slow rate (1-2% a year)
society
can probably adapt without upheavals any worse than the last oil
shock. If it crashes at more than 20% a year I don't see how
society can survive. More thoughts
on this.
In 1999 I predicted fuel cost would reach $10/gallon by 2010.
I began reading up on this to confirm my position, and after reading
Kenneth Deffeyes' books Hubbert's
Peak:
The Impending World Oil Shortage
and,in 2005 Beyond
Oil:
The View from Hubbert's Peak I was pretty
convinced the situation
was very serious. In 2005 I tackled adapting to peak oil
before
it
happened by reducing my petroleum use as far as practical. I
have
been very successful, reducing my oil use from about 2,900 gallons a
year prior to 2005 down to around 1,700 in 2006 and it looks like I
may
get it below 1,400 in 2007. That is a 50% reduction in oil use
in
2 years. I am writing up a series of case
studies about people and businesses like me who are adapting
to
peak oil (if you are one and would like to be included please give
me a
call at 907/ 488-1001).
Matthew Simmons is an investment banker, and I read his book Twilight
in
the Desert in the fall of
2006. It turned
out to be a really excellent book
about Saudi Arabia oil, and how it is likely to peak soon. A
few
intervies he did:
- Matthew Simmons' Interview--price
may
go to $300.
- Matthew Simmons' Interview--Peak
Oil,
counters Rex Tillerson of Exon.
- Peak oil interviews
with John Kilduff and Matt Simmons.
Some other YouTube blurbs:
- Peak Oil Documentary
(link to first of 9)--the first ones are more bashing big oil
&
environmental damage, but #6
starts
into Peak Oil with interesting data (the rest isn't as good).
The US Government is becoming concerned:
- February, 2005: The DOE (Department of Energy) wrote and
excellent overview of peak oil (known as the Hirsch
Report after the author, Robert Hirsch): Peaking of World
Oil
Produciton: Impacts, Mitigation, & Risk Management.
- February, 2007: The GAO (Government Accounting Office) report on
Peak Oil
("Uncertainty About Future Oil Supply Makes It Important to
Develop a
Strategy for Addressing a Peak and Decline in Oil Production").
I believe it is possible to reduce our dependency on oil faster than
supply will decline. I have been taking draconian measure to
reduce my personal and business oil
consumption. Of course this isn't completely possible, but I
have
been
fairly successful. My biggest personal petroleum use is to
heat
the
house. In the early 1980's, when the boiler in the house
failed,
we replaced it with a multi-fuel boiler. This allows us to use
wood, coal, heating oil or electricity to heat the house.
Prior
to 2005 we were using around 1,300 gallons a year to heat the house
(for those of you who don't know me, I live in Fairbanks where we
often
have weeks (sometimes months) of temperatures below -20 F (-29 C),
so
the annual heating degree days averages over 13,000! (for those of
you
concerned about global warming, July 1 2006 to May 5, 2007 we were
colder than average). In the winter of 2005-6 we reduced our
use
of heating oil to 700 gallons, and in the winter of 2006-7 down to
210. We accomplished this by burning primarily wood in 2005-6
and
wood and coal in 2006-7. For transportation we have bought a
scooter that gets over 100 miles to the gallon as our primary
transportation when doing shows and light maintenance; we bought a
Civic Hybrid that gets over 50 mpg on the highway (Fairbanks to
Anchorage--340 miles--on 6 gallons! We also bought a truck
that
burns diesel, which we can make from used vegetable oil (as long as
the
supply of that holds up.)
My business used to burn a little over 30,000 gallons of heating oil
a
year (for my apartment buildings). In 2006 I converted one
building to coal, and am in the process of converting 4
others. I
have also converted one building to use waste cooking oil. We
are
investigating the possibility of burning glycerin as well (a
byproduct
of making biodiesel). This year (2007) I plan to get a minimum
of
2 more buildings converted to coal, reducing my heating oil needs to
15,000 gallons a year or less. By 2009 I hope to be completely
off oil
heat, using coal, solar, electric, etc. This is driven
primarily
by a need to keep my rents low; I feel that heating oil prices are
going to reach nearly $10 a gallon which would requrie raising rents
by
$300 per month--something that would distress many of my low-income
tenants, perhaps bankrupting those on fixed incomes like the
elderly.
Graphs & other data I've collected:
- It appears the United Kingdom's natural gas has peaked and is
in
serious decline.
- It appears the US's natural gas peaked in 2001 and is in a
major decline--we are now
producing less natural
gas than in 1995!
- It appears OPEC's oil production has peaked and is declining
(data is weak, as yet--they may have reduced supply
deliberately)
- Saudi Arabia's oil production appears to have peaked, and
declined 8% last year. Is this real, or did they shut the
valves
on purpose?
- The world is near a peak...but
this
data is a year old; have we peaked? This graph
from Deffeyes
(who got his data from the U.S. EIA {Energy
Information Administration}) says we have--or have we just
reduced
consumption?
- Driving without gasoline
P.S. Why do I think I know what I'm talking about? First
I
have an ancient background in the oil industry. My grandfather
developed oil
fields in Pennsylvania, Oklahoma and Kansas (indeed, he invented the
water injection technique for improving recovery). I continue
to
own a considerable amount of oil stock (some of it origionally
purchased by my
grandfather in the 1940's and 1950's). I've worked on the
remains
of his claims with my 'uncle' (Dad's cousin) Burt Collins in the
1980's. In the 1990's I got a degree in geology. In
addition I grew up out in the bush, where oil was very expensive, so
I
grew up in an environement of alternative energies--our heat was
wood;
our electricity was about 60% solar & wind; our generator was a
co-generation unit, which heated the house with 'waste' heat.
Currently I own apartment buildings in Fairbanks, and one of the
major
expenses is heating oil. I have begun terminating my reliance
on
petroleum, with considerable success. Thus I am well versed in
the probabilities of a shrinking oil supply and how to adapt to it.
The current copyright laws protect
this page, even though not specifically copyrighted.
However if you want to use portions
of
it feel free to do so, though I would appreciate it if you would
acknowledge my authorship.
Last messed with spring 1999.
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