Quote:June 3, 2003
The Association for the Study of Peak Oil threw a major conference last week in Paris. The org is lead by Colin Campbell, retired chief geologist for Shell Oil, and the board members include an impressive roster of geologists who have worked both for Big Oil and acadamia, for instance, Kenneth Deffeyes of Princeton, retired exploration manager of France's giant Total company Jean Laherrere, Pierre-Rene Bauquis, VP of the French Energy Institute (IFP), and others like Matthew Simmons, the Houston-based investment banker specializing in energy companies.
The message emerging from the meeting is that the world may have already entered the unchartered territory of global oil depletion -- that is, the downside of "Hubbert's Curve," the bell graph first used by Shell Oil geologist M. King Hubbert in 1956 to describe the destiny of the world's oil supplies. Here are some of the salient points presented (thanks to Michael C. Ruppert reporting for the Fromthewilderness.com).

-- Deffeyes repeated a claim he made in April that, based on production figures for the past three years, the world seems to have passed peak oil production in 2000.

-- The once-hoped-for Caspian Sea bonanza has proved to be a major bust. British Petroleum and Exxon/Mobil have already pulled out.

-- Reserve figures have been uniformly overstated for decades by both major oil companies and national governments -- for tax advantages in the case of US companies and to evade export quota regulations in the case of OPEC members. Saudi Arabia's reserves may be substantially lower than the 250 billion barrels claimed, and in fact Saudi Arabia may be producing now at 100 percent capacity, meaning they may now be passing peak.

-- Oliver Appert, Chairman of the IFP, declared there are no more major significant reserves to be discovered and that the world oil depletion rate is between five and ten per cent per year, requiring 60 million barrels a day in new production to meet demand.

-- Auto sales in China jumped 50 percent in 2002 alone.

-- Matthew Simmons told the group that the US natural gas supply is near a crisis point. By 2001, with record drilling, there was no increase in supply, and by 2003 production was in serious decline. New Texas gas wells, he said, are in decline an average of 83 percent one year after drilling. "The world has no Plan B," he said.

--Dutch economist Maarten Van Mourik told the group that deep water drilling would not add significantly to the world's oil reserve, that it did not make sense economically, and ultimately could only produce five billion barrels -- equal to a 60-day world demand at current levels. Van Mourik also made the interesting observation that, "it may not be profitable to slow decline."

-- All speakers addressing the issue stated that no combination of alternative energy sources can replace hydrocarbons, and none even dreamed of will be implemented in time to avert major disruptions in industrial civilization.

-- Dr. Jorg Wind, representing auto giant Daimler / Chrysler told the conference that his company did not view hydrogen as a viable alternative to petroleum-based engines. He stated that fuel cell vehicles would never amount to significant market share. Hydrogen was ruled out as a solution because of intensive costs of production, inherent energy inefficiencies, lack of infrastructure, and practical difficulties such as the extreme cost and difficulty of storage. The Daimler / Chrysler representative dismissed ethanol out of hand as "not energy efficient."

-- Pierre-Rene Bauquis remarked that commercial production of hydrogen is two to five times the cost of fossil fuels used to produce it.

-- Other French presenters stated that ethanol used in France enjoyed a 300 percent government subsidy.

-- Physics Professor Kjell Aleklett told the conference that exploiting the Canadian Tar Sands would be a financial and economic disaster, insofar as the amount of natural gas needed to create steam to process the mined sands, as well as the massive amounts of water used and polluted in the process.

-- Chris Skrebowski of the UK's Institute of Petroleum noted that by 2007 Britain will be in its second year of natural gas imports and its first year of oil imports, having severely depleted its North Sea reserves by that time.