Oil Barren

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David Goodstein believes the world faces an imminent shortage of oil. Goodstein, vice provost and distinguished professor of physics at Caltech, is the author of “Out of Gas: The End of the Age of Oil,” in which he outlines the severe economic consequences of a depleted energy supply. In doing so, he cites the work of an oil industry geologist named M. King Hubbert who correctly predicted in 1956 that oil production in the lower 48 states would reach its peak in 1970 and then start an inexorable decline.


Question: Is the price of oil today an indication that supplies have begun to run out?


Answer: Well, it’s really impossible to tell. It appears that the worldwide production and distribution systems have been stretched to the breaking point. That would certainly be a symptom of reaching Hubbert’s Peak, but the fact that we see a symptom doesn’t mean that we have really reached the peak. It’s possible any of a number of things will happen that will loosen up supplies and the peak could still be off later in the decade or even the next decade.


Q: Could you explain Hubbert’s Peak?


A: Oil, like any other natural resource, has a supply that starts at zero, rises very rapidly, slows down, and eventually reaches a point where you are depleting the resource faster than you can develop new ones. In other words, there will be a bell-shaped curve.


Q: The prediction was proven for this country.


A: Hubbert made public the prediction in 1956 that the lower 48 production of oil would peak around 1970. The data when you look back on it now are very impressive. But he also made a prediction in 1969 that worldwide oil would peak around 2000. It hasn’t peaked yet, but it may be peaking. It may be that he was not very far off.


Q: But the oil industry says you are way off base.


A: Most of the people don’t believe there is going to be a crisis work for the oil industry. People who work for the oil industry are naturally the most knowledgeable, but they do have a conflict of interest.


Q: The industry has a very straightforward argument that given current reserves and annual oil consumption there are enough supplies for at least 40 years.


A: That is what they call the r/p ratio, the reserves to production in the industry. They take proven reserves, which right now stand at just over 1 trillion barrels. And they divide it by the annual use, which is a little more than 25 billion barrels per year. They say that is 40 years nothing to worry about. But that assumes we are going to use oil at a steady rate for the next 40 years and not have any problems until we come to the last drop. But those assumptions are ridiculous. Consumption is increasing a few percent per year.


Q: You also criticize the industry’s reserve numbers.


A: If you look at the historical data, the proven reserves of oil of OPEC countries alone jumped by 300 billion or 400 billion barrels in the late 1980s. If you look at the history of discovery you will find that no significant discoveries of oil were made in the OPEC countries in the late 1980s. Instead, what happened was that OPEC changed its quotas on how much countries could pump, based in part on its stated proven reserves. And proven reserves appeared magically out of nowhere. This is oil that was discovered by politicians, not geologists. It’s possible that half the proven reserves on Earth are just imaginary and they are not there at all.


Q: But don’t you have faith that new technology could make it possible to discover huge new fields?


A: It would be incorrect to say that people like me have no faith in technology. After all, I am a scientist. With the price of oil as high as it is, exploration has been going on all over the place. The oil geologists have already gone to the ends of the Earth looking for oil.


Q: That sounds like there is at least some hope.


A: The experience of exploration in recent years is that we find less and less oil in smaller and smaller deposits that are less and less economical.


Q: But aren’t there other forms of readily available hydrocarbons that can be used as fuel?


A: We have all kinds of hydrocarbons, from oil and natural gas to unconventional ones such as tar sands to heavy oil. There is also something called shale oil and something called methane hydrate and there is coal. But as you go down the list of hydrocarbons it becomes more and more expensive, not only in money but in energy. You are spending energy to make energy and sometimes you don’t win the game. For example, ethanol from corn is a net loser. You lose more fossil fuels than you replace.


Q: This sounds dire.


A: The worst case is that Hubbert’s Peak occurs and we have a crisis that involves runaway inflation. Not only will gasoline cost more but so will all the commodities made out of petrochemicals. Inflation could even bring worldwide depression. If the economic hit is hard enough we may not be able to rebuild the infrastructure to use something else in place of oil.


Q: Isn’t there some way out of this?


A: The best-case scenario is that we will have an oil price shock, which will serve as a wake up call. We may be seeing the beginning of it, but right now the shock is not big enough.


Q: Then what happens?


A: Well, for the foreseeable future we can use other fossil fuels. It’s painful, perhaps damaging to the climate in ways we can’t predict, but we can hope to muddle through.


Q: And what comes after?


A: There are only two other possible sources of energy. One is the sun and the other is nuclear. And there is efficiency, what some people call conservation. You can make cars out of lightweight super-strong materials and airplanes as well so they burn less fuel. We are not being pushed to do it.


Q: And by the sun you mean solar?


A: We do use a great deal of solar energy in the form of hydroelectric power. The only problem is we can’t expand that because we have already built dams pretty much everywhere they can be built. Wind is becoming more popular and will continue to become a more important source of energy as turbine technology advances.


Q: In your book you say nuclear energy will have to be an important solution to this crisis.


A: When you start running out of energy and have a real crisis it’s going to become much more attractive. We know now how to make reactors that are really safe. In fact nuclear energy has always been far safer than the alternatives. The only nuclear incident in history with a substantial number of deaths was Chernobyl. In Chernobyl there were 31 immediate deaths and most of those were heroic fireman who knew they were risking their lives to quiet the situation. The other 2,300 deaths that occurred really occurred because of poor public health in the Ukraine.


Q: What about photovoltaic cells?


A: They are the gold standard because they are roughly 10 percent efficient. But to generate 10 terawatts of electric energy (the amount required to replace fossil fuels worldwide) would require 220,000 square kilometers of them, roughly half the size of California. There could be breakthroughs, but not if we destroy our economy and civilization (first).


Q: This all sounds rather pessimistic.


A: There is no magic bullet. We have evolved a civilization since 1859 that is firmly rooted in the mathematically impossible promise of an endless supply of cheap oil. That cannot happen.


Q: What do you personally do to stave off the crisis?


A: I have been driving a hybrid for the past three years. I was driving a Honda Insight. This past weekend I sold it and bought a Toyota Prius. I just wanted to try the different technology. I think it’s wonderful. Forty percent of the oil we use is for cars and hybrids would just halve the amount of oil we would use while driving. It’s wonderful.

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