Not the end of oil
Special thanks to Trudeaupia’s entry for setting me on to J Simon’s works, including this chapter in particular.
“Known reserves” are much like the food we put into our cupboards at home. We stock enough groceries for a few weeks or days – not so much that we will be carrying a heavy unneeded inventory that bulges the cupboard and ties up an unnecessary amount of money in groceries, and not so little that we may run out if an unexpected event – a guest or a blizzard – should descend upon us. The amount of food in our cupboards tells little or nothing about the scarcity of food in our communities, because as a rule it does not reveal how much food is available in the retail stores. Similarly, the oil in the “cupboard” – the quantity of known reserves – tells us nothing about the quantities of
oil that can be obtained in the long run at various extraction costs.This explains why the quantity of known reserves, as if by a miracle of coincidence, stays just a step ahead of demand, as seen in figure 11-5. An elderly man commented to me in the 1970s that, according to the news stories about known reserves, “we’ve been just about to run out of oil ever since I’ve been a boy.” Yet most discussions of the oil and energy situation – among laymen and also among the most respected journalists – still focus on known reserves.
1 Comment
RSS feed for comments on this post. TrackBack URL
Sorry, the comment form is closed at this time.
I’m afraid your explanation shows your ignorance of the subject. Its a little more complicated than you suggest. Reserves calculations are done annually and can either add or subtract from the total reserves. Lets face it companies like to show as much reserves as possible and have another category called probable reserves. This is the amount they hope to produce. Your correct that reserves do increase in step with demand, but this is not some sort of trick used by oil companies, but additional reserves are added as technology advances and often with increasing production costs. However often new technology is not just dependant on production costs but also on overall efficiency of the process. It doesn’t make much sense to expend more energy in the process than you can recover. Advances in steam assisted insitu technologies and mining applications has greatly increased the producible reserves in The Tarsands of Alberta, the real question is will natural gas be available to fuel these processes in the future. There is about 8 years supply of natural gas in Alberta at the present production rates. The gas reserves have not kept up with production for the last 20 years. Given the recent spike in gas prices you would think this trend would reverse itself. But its hard to do when production keeps rising to meet the increasing demand in the US.