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Peak Oil


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Peak Oil

  1. 1. Peak Oil – The Tipping Point
  2. 2. Our entire way of life depends on Oil
  3. 4. The formation of Crude Most geologists view crude oil and natural gas as the product of compression and heating of ancient organic materials over geological time. Planktons High temperature High pressure Flourish during the last Global Warming (Jurassic Age 300 million to 200 million yrs ago). Dead body sank to ocean floor and become thick sediments. Oil
  4. 5. USA claims worlds first oil well Titusville Pennsylvania 1859
  5. 6. Ghawar, Saudi: The world’s largest oil field Ghawar was discovered in 1948 and put on stream in 1951. Estimated to have 71 billion barrels of proven reserves. Ghawar
  6. 7. Peak oil is….. <ul><li>the point at which we can no longer increase the amount of oil we pump. From that moment the entire globe will have an ever decreasing supply of oil. </li></ul>
  7. 8. Why is oil supply peaking, how do we know? <ul><li>M King Hubbert </li></ul><ul><li>- 2 discoveries </li></ul><ul><li>Fields peak when ½ the oil has been extracted. </li></ul><ul><li>There is a time lag between discovery of an oil field and that field’s peak production of about 25-40 years. </li></ul>
  8. 9. Peak to Peak 40 years US-48
  9. 10. Peak to Peak 30 years Egypt
  10. 11. Peak to Peak 27 years Russia
  11. 12. Peak to Peak 25 years United Kingdom
  12. 13. World Oil Discovery Trend Historical Data ExxonMobil
  13. 14. Where is it? Regular Conventional Oil
  14. 15. 2004 was a key year for depletion <ul><li>All spare capacity used. OPEC has recently suspended their quota system. </li></ul><ul><li>But also in 2004: </li></ul><ul><ul><li>Refinery spare capacity nearly disappeared </li></ul></ul><ul><ul><li>Sulphur removal capacity did disappear </li></ul></ul><ul><ul><li>Tankers were costly and in short supply </li></ul></ul>
  15. 16. ‘ Peak Oil’ in 2007/08? <ul><li>Whatever approach we use the answer seems to be ‘Peak’ in 2007/2008 </li></ul><ul><li>Before that, if all goes to plan, the world can, possibly, meet likely demand </li></ul><ul><li>After that it is hard to see how demand can be met without demand destruction </li></ul><ul><li>But, there are no guarantees </li></ul>
  16. 17. Various Predictions of World Oil Production Peaking <ul><li>Simmons: 2007-2009 </li></ul><ul><li>Goodstein: 2007-2009 </li></ul><ul><li>Skrebowski: After 2007 </li></ul><ul><li>Bakhtiari: Before 2010 </li></ul><ul><li>Laherrere: 2010-2020 </li></ul><ul><li>Douglas - Westwood: As early as 2016 </li></ul><ul><li>EIA (Nominal case): 2016 </li></ul><ul><li>Shell: After 2020 </li></ul><ul><li>Campbell: Around 2010 </li></ul><ul><li>USGS 95% probability 2032 </li></ul><ul><li>USGS 5% probability 2012 </li></ul>
  17. 18. WORLD OIL DEMAND <ul><li>We currently require 84 mbd of oil, and that will rise by around 2-3 mbd by the end of the year. Demand is growing ~2 % per year. </li></ul>