Post on 31-Dec-2015
description
Foraminifera fossils commonly found in crude oil
Crude is the product of the
decayed remains of billions of sea
creatures.
Crude is uniquely energy intense
Energy in 1 gallon of oil equal to
= 5 kilograms of the best coal
=more than 10 kg of wood
=more than 50 days of full-time human labor
=100 times more energy than its extraction requires
First market for crude = kerosene lighting
“Give the poor man his cheap light” John D. Rockefeller, Standard Oil
Octane was waste
Kerosene market crumbled after Edison invented light bulb in 1879;
but Standard Oil was swimming in oil
A forest of oil derricks, California
Per person per mile
Cars require three times more energy than trains
Cars require 30 times more energy than bicycles
The paving of the United States 1907: less than
200,000 miles of U.S. roads had any kind of surfacing
Today, nearly 4 million miles of paved highway alone
1955: 50 million cars owned by Americans
1975: 100 million cars
1990: one car owned per licensed driver
Today, a new car is bought in the US every 3 seconds
We consume crude 100,000 times faster than it can accumulate underground
M. King Hubbert delivering his speech to the American Petroleum Institute, 1956
Minutes beforehand, employer Shell urged him to tone down his findings
The first oil shock
1960: Organization of Petroleum Exporting Countries formed
OPEC countries govern access to over half of the world’s conventional oil
1971: US oil production peaks 1973: OPEC embargoes oil to US and Netherlands Price of oil rises from $3/barrel to $12/barrel in six
months Between 1970-1980 consumer prices double
“Any means necessary”
The Carter Doctrine: the US will defend access to Persian Gulf oil using any means necessary
Oil is lifeblood of US economy 70 percent of weight of US army = fuel
North Sea oil peaks in mid-1980s
Alaskan oil peaks in 1988 $10 billion needed to
rehabilitate North Slope 300 million gallons of
toxic sludge in North Sea
North Sea and Alaskan oil decline
New oil: an heroic effort
Hibernia
Over 2,000 icebergs 15,000 ton rig sank in
1982 New rig built with
400,000 tons of concrete and 69,000 tons of steel
Submerged with 400,000 tons of iron
Total production = 0.5 billion barrels
Declining discoveries of new oil
Since 1960, the size of new oil finds has declined
Since 1980, the rate of discovery of new oil finds has declined
Last year, one new barrel of oil found for every 6 consumed, despite industry spend of $238 billion on oil exploration
Flow of oil from known oilfields declines 3 to 5 percent a year
Fuelling petro-demand
Increasing oil demand in China and India is “crucial to the long-term growth of oil markets,” according to the DOE
World Bank spends 15 times more on fossil fuel projects than renewable energy
World Trade Organization accepted China’s membership contingent on slashing tariffs on car imports
Bicycles banned
in Shanghai 40,000 new miles
of highway planned in India
Developing countries led by China and India expected to consume 90 percent as much oil as industrialized countries by 2020
“Dutch Disease”: The curse of crude
Oil production in Algeria, Angola, Congo, Ecuador, Gabon, Iran, Iraq, Kuwait, Libya, Peru, Qatar, and Trinidad Tobago coincided with a decline in the standard of living
Per capita income in Saudi Arabia dropped from $28,000 in 1981 to ~$10,000 in 2004
War in Angola, Colombia and elsewhere paid in petro-dollars
Challenges for oil industry
Public disapproval of high prices and profits in industry
Declining discoveries of new, conventional oil
Declining production of old oil
Record profits from high oil prices
$10 trillion invested in current oil and gas infrastructure
Minimal investments in renewables
Increasing investment in natural gas
Increasing investment in unconventional oil resources
Tar sands: Open-pit mining, Alberta
•300 billion potentially recoverable barrels of oil
•Globally, 2.5 trillion barrels oil locked in tar sands
•Cost of extraction in 1980: $30/barrel (compared to Saudi oil at $2/barrel)
•Cost of extraction today: $5-7/barrel
Turning tar sands into oil
Burns up to a fifth of Canada’s natural gas supply
Emits 6 times more C02 than producing a barrel of conventional oil
Requires 6 barrels of freshwater for each barrel
Threatens Alberta’s forests with acid rain
Crude’s royal successor: natural gas
Exxon invested $7 billion in new project to turn natural gas into diesel
Half of BP’s $8 billion investment in alternative and renewable energy is in natural gas
Natural gas: an “environmentally friendly” fossil fuel? Burning natural gas emits less carbon dioxide
than burning oil Unburned natural gas (methane) absorbs 23
times more heat than carbon dioxide With 3 percent leakage, using natural gas has
same climate-warming effect as burning oil With 6 percent leakage, using natural gas has
worse effect on atmosphere than burning coal Most recent data suggests present leakage of
at least 2.3 percent
“Our biggest problem is not the end of our resources.
That will be gradual. Our biggest problem is a
cultural problem. We don’t know how to cope with it.”
—M. King Hubbert
Toward a sustainable energy future
Appropriate price signals Energy literacy Challenging power of oil industry Modelling a post-oil society