Peak Oil News: 07/01/2005 - 08/01/2005

Saturday, July 30, 2005

US Govt Sponsored Peak Oil Report Draws Disturbing Conclusions

Resource Investor

By Michael J. DesLaurier

TORONTO (ResourceInvestor.com) -- A 67-page report released earlier this year on the subject of Peak Oil and sponsored by the U.S. Department of Energy drew several conclusions:

1.World Oil Peaking is Going to Happen
2.Oil Peaking Could Cost the U.S. Economy Dearly
3.Oil Peaking Presents a Unique Challenge (“it will be abrupt and revolutionary”)
4.The Problem is Liquid Fuels (growth in demand mainly from transportation sector)
5.Mitigation Efforts Will Require Substantial Time
6.Both Supply and Demand Will Require Attention
7.It Is a Matter of Risk Management (mitigating action must come before the peak)
8.Government Intervention Will be Required
9.Economic Upheaval is Not Inevitable (“given enough lead-time, the problems are soluble with existing technologies.”)
10.More Information is Needed

Based on the report (Peaking of World Oil Production: Impacts, Mitigation, & Risk Management) we are probably in quite a bit of trouble if, as some analysts suggest, peak oil is already upon us. The study was led by Dr. Robert Hirsch who is a Senior Energy Program Advisor at SAIC (Science Applications International Corporation), and who has had a long career in Energy milieu in a variety of important positions.

3 Scenarios

The study envisions three scenarios for dealing with a peak oil reality: scenario one involves action not taken until peaking occurs, and scenarios two and three deal with action taken ten and twenty years prior thereto. The conclusions follow:

* Waiting until world oil production peaks before taking crash program action leaves the world with a significant liquid fuel deficit for more than two decades.

* Initiating a mitigation crash program 10 years before world oil peaking helps considerably but still leaves a liquid fuels shortfall roughly a decade after the time that oil would have peaked.

* Initiating a mitigation crash program 20 years before peaking appears to offer the possibility of avoiding a world liquid fuels shortfall for the forecast period.

“The obvious conclusion from this analysis is that with adequate, timely mitigation, the costs of peaking can be minimized. If mitigation were to be too little, too late, world supply/demand balance will be achieved through massive demand destruction (shortages), which would translate to significant economic hardship, as discussed earlier.”

Based on these conclusions, the global economy could stand to suffer incalculable consequences if peak oil is already upon us. Apparently, the world seems to need at least twenty years notice and a serious coordinated effort in order to truly avoid sever economic pain.

According to Hirsch, “The world has never confronted a problem like this, and the failure to act on a timely basis could have debilitating impacts on the world economy. Risk minimization requires the implementation of mitigation measures well prior to peaking. Since it is uncertain when peaking will occur, the challenge is indeed significant.”

Oil Sands

Like many of the other experts whose opinions have been aired through Resource Investor, Hirsch would appear to find the much-vaunted Canadian oil sands inadequate, though admittedly they have the potential make a positive dent in the problem.

The report states, “In addition to needing a substitute for natural gas for processing oil sands, there are a number of other major challenges facing the expansion of Canadian oil sands production, including water81 and diluent availability, financial capital, and environmental issues, such as SOX and NOX emissions, waste water cleanup, and brine, coke, and sulfur disposition. In addition, because Canada is a signatory to the Kyoto Protocol and because oil sands production results in significant CO2 emissions per barrel, there may be related constraints yet to be fully evaluated.”

“The current Canadian vision is to produce a total of about 5 MM bpd of products from oil sands by 2030. This is to include about 3 MM bpd of synthetic crude oil from which refined fuels can be produced, with the remainder being poorer quality bitumen that could be used for energy, power, and/or hydrogen and petrochemicals production. 5 MM bpd would represent a five-fold increase from current levels of production.82 Another estimate of future production states that if all proposed oil sands projects proceed on schedule, industry could produce 3.5 MM bpd by 2017, representing 2 MM bpd of synthetic crude and 1.5 MM bpd of unprocessed lower-grade bitumen."

“it is also worth noting that the bitumen yield from oil sands surface mining operations is about 0.6 barrels per ton of mined material, excluding overburden removal. This is similar to the yield from a good quality oil shale, but is less than Fisher-Tropsch liquid yields from coal, which is about 2.6 barrels per ton of coal.86”

Conclusion

Readers of Resource Investor are far more aware of the energy related challenges ahead than the average man in the street who believes that high oil and gas prices are the result of Iraq, OPEC, and some underhanded, self-serving conspiracy involving Bush, Cheney and Halliburton. Unfortunately, a sound knowledge and understanding of the situation makes us no less vulnerable.

While the specific implications of peak oil remain unclear, there can be no mistaking that any period between involving a lapse in adequate energy supply will be met with economic hardship for the global economy. If peak oil is not upon us already, the chances of minimizing future damage are fair and it is certainly encouraging to know that government authorities are taking the threat seriously. Any way you slice it however, the economy and the consumer are unlikely to escape unscathed through the transition period into other energy sources as the world comes to grips with a new evolving paradigm in satisfying its needs for energy consumption.


Where Is the Hirsch Report?

Global Public Media

Where Is the Hirsch Report?

In Brief: Half a year after its release, the Hirsch report is nowhere to be found. For several months it was archived, in PDF format, on a high school web site (www.hilltoplancers.org, Hilltop High School in Chula Vista, Calif.). On July 7 the report disappeared from that site. The Atlantic Council (www.acus.org) is considering publishing the Hirsch report; however there is no projected date of release. When contacted, Dr. Hirsch replied that the document is "a public report, paid for and released by DOE NETL, and that it therefore could be reposted at will."-By Richard Heinberg

Over the past few months controversy has raged over the timing of Peak Oil-the moment when global oil production will reach its all-time maximum and begin its inevitable descent.

Oil optimists say the event won't occur for twenty years or more, and that market forces will result in an imperceptible transition to alternative forms of energy. "The Stone Age didn't end for lack of stones," say the optimists, "and the Petroleum Age won't end because we run out of oil"-but because we find something better and cheaper with which to fuel our society.

Pessimists point out that global oil discoveries have been plummeting for decades and that supply and demand are now closely matched (hence the run-up in oil prices over the past few months); moreover, there simply isn't an alternative energy source available that can take oil's place in the near term. They say we may be at peak now, and that the consequences will be staggering. In short, oil pessimists spin out end-of-civilization scenarios while optimists insist that there is nothing to worry about.

Evidently the US Department of Energy is interested enough in the Peak-Oil debate to commission a report on the subject. Released in February this year by Science Applications International Corporation (SAIC), and titled "Peaking of World Oil Production: Impacts, Mitigation and Risk Management," the report examines the likely consequences of the impending global peak. It was authored principally by Robert L. Hirsch (bio: www.d-n-i.net/fcs/hirsch_bio.htm), and is as remarkable for its subsequent reception as for its content.

The report's Executive Summary begins with the following paragraph:

The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking.

The report's authors were not asked to assess when the global peak is likely to occur; however they do survey the range of forecasts from optimists and pessimists alike, projecting a peak date anywhere from 2005 to 2037.

The Hirsch report examines three scenarios: one in which mitigation efforts are not undertaken until global oil production peaks; a second in which efforts commence ten years in advance of peak; and a third in which efforts begin twenty years prior to the peak. Each scenario assumes a "crash program rate of implementation." In the first case, the study concludes that peak will leave the world with a "significant liquid fuels deficit for more than two decades" that "will almost certainly cause major economic upheaval"; even with a ten-year lead time for mitigation efforts government intervention will be required and the world will experience a ten-year fuel shortfall. A crash program initiated twenty years ahead of the event will offer "the possibility" of avoiding a fuel shortfall. The report emphasizes repeatedly that both supply- and demand-side mitigation options will take many years to implement and will cost "literally trillions of dollars"; it also notes that "the world has never faced a problem like this."

The Hirsch report concludes that substantial mitigation of the economic, social, and political impacts of Peak Oil can come only from efforts both to increase energy supplies from alternative sources and to reduce demand for oil. With regard to the claim that efficiency measures by themselves will be enough to forestall dire impacts, Hirsch et al. note that, "While greater end-use efficiency is essential, increased efficiency alone will be neither sufficient nor timely enough to solve the problem. Production of large amounts of substitute liquid fuels will be required." Further, "Mitigation will require a minimum of a decade of intense, expensive effort, because the scale of liquid fuels mitigation is inherently extremely large." Hirsch, et al., also point out that "The problems associated with world oil production peaking will not be temporary, and past 'energy crisis' experience will provide relatively little guidance."

Oil optimists often say that efforts aimed at mitigating the effects of Peak Oil undertaken too soon would entail a cost to society. The SAIC Report agrees. However, it concludes that, "If peaking is imminent, failure to initiate timely mitigation could be extremely damaging. Prudent risk management requires the planning and implementation of mitigation well before peaking. Early mitigation will almost certainly be less expensive than delayed mitigation."

Optimists also insist that the market can take care of the problem: high oil prices will stimulate more exploration, the development of more efficient cars, and the deployment of alternative energy technologies. Interference with market mechanisms would be harmful, they say, and so the government should steer clear of the problem by avoiding setting higher efficiency standards, subsidizing renewables, and so on.

The report's authors dismiss these claims. Price signals warn only of immediate scarcity; however, the mitigation efforts needed in order to prepare for the global oil production peak must be undertaken many years in advance of the event. Hirsch, et al., maintain that, "Intervention by governments will be required, because the economic and social implications of oil peaking would otherwise be chaotic. The experiences of the 1970s and 1980s offer important guides as to government actions that are desirable and those that are undesirable, but the process will not be easy."

Here, then, is a significant report produced by an independent research company for the US Department of Energy, warning of a global problem of "unprecedented" proportions with economic, social, and political impacts that are likely to be extremely severe. The authors forecast "protracted economic hardship" for the United States and the rest of the world. It is a problem that deserves "immediate, serious attention."

Yet, half a year after its release, the Hirsch report is nowhere to be found. For several months it was archived, in PDF format, on a high school web site (www.hilltoplancers.org, Hilltop High School in Chula Vista, Calif.). On July 7 the report disappeared from that site. The Atlantic Council (www.acus.org) is considering publishing the Hirsch report; however there is no projected date of release. When contacted, Dr. Hirsch replied that the document is "a public report, paid for and released by DOE NETL, and that it therefore could be reposted at will."

Project Censored is therefore posting the report in full at: http://www.projectcensored.org/newsflash/The_Hirsch_Report_Proj_Cens.pdf

If the content of the Hirsch report is to be believed-and there is every reason to think it should be-then this is a document that deserves the close attention of every leader of government and industry in the US. Newspapers and newsmagazines should be running excerpts and summaries. Instead, there is nearly total silence. In late May Robert Hirsch presented the substance of the report at the annual Workshop of the Association for the Study of Peak Oil (ASPO) in Lisbon, Portugal to an audience of about 300 (www.cge.uevora.pt/aspo2005/abscom/Abstract_Lisbon_Hirsch.pdf ). That event received virtually no press coverage in the US.

Meanwhile oil is hovering around $60 and is likely to head higher, and analysts look to the fourth quarter of 2005 unsure whether supply will be able to keep up with burgeoning demand.

Richard Heinberg

rheinberg@igc.org

Hirsch Report on Line at Project Censored: http://www.projectcensored.org/newsflash/The_Hirsch_Report_Proj_Cens.pdf

Peter Phillips Ph.D.
Sociology Department/Project Censored
Sonoma State University
1801 East Cotati Ave.
Rohnert Park, CA 94928
707-664-2588
http://www.projectcensored.org


Energy Bill Makes Bad Energy Outlook Worse -- National & Homeland Security Threatened

Emediawire.com

New U.S. Energy Bill speeds up oil reserve depletion, increases dangerous dependence on Middle East oil that threatens national and homeland security. Provides funding for major expansion of radioactive energy(Nukes)and continues focus on high polluting fossil energy. Discourages investment in abundant clean energy resources and and protects windfall profits of big oil and energy. Visit www.cleanpeace.org for more information.

(PRWEB) July 30, 2005 -- The energy bill Congress sent to the White House today guarantees America's continued dangerous, dependence on Middle East oil.

The U.S. holds between 2 percent and 3 percent of world oil reserves, the Persian Gulf nations hold 50 percent and the Middle East dominated OPEC cartel controls 61 percent. Middle East dictators have oil staying power; the U. S. and Western democracies do not.

“The bill subsidizes more rapid depletion of dwindling U.S. oil reserves. Subsidized oil production means faster oil depletion, an increasingly dangerous dependence on Middle East oil, the dictators who control it and the terrorists who influence them,” said author Roy McAlister, a Cleanpeace. org Co-President and a world authority on clean fuel production from wind, wave, biomass and solar energy.

America's prosperity and security depend on adequate supplies of the cheap oil that powers the nation's economy. Increasing dependence on Middle East oil supplies that can be disrupted by violence or political change at any time threatens both. Without adequate cheap oil supplies America could face recessions, depression and worse.

The energy bill's policies will not fill the oil gap, improve the environment, reduce global warming or encourage use of America's abundant undeletable energy.

The bill heavily subsidizes depletable radioactive energy (nuclear power), coal and other fossil fuels while short-changing undepletable energy.

This severe imbalance in funding and policy advantages makes fossil and radioactive energy appear less expensive than undepletable energy discouraging its commercialization and sustaining windfall profits for big oil.

“Earth collects more energy from the sun in one day than all the oil it ever contained. Nature stores vast amounts of this energy in wind, wave action, biomass and direct solar in sun-scorched deserts. All these abundant forms of solar energy can be converted to hydrogen and fuel America's existing utility, industrial, transportation and agricultural engines without pollution.” said McAlister.

But,Congress prefers to serve big oil profits rather focus policy and funding on this clean energy source that could bring real energy independence, cleaner air and water and strong national security.

“The bill protects oil and OPEC from real competition. It stacks the competitive deck against undepletable energy and that stacks the deck against America.” said Bill Garrett, a Co-President of Cleanpeace.org, a non-profit clean, undepletable, energy advocacy group.

Radioactive power (Nukes) can not safely fill the oil gap. The fossil resources subsidized by the energy bill cannot be mined and processed into oil fast enough to replace the gushes of oil that have fueled American and world prosperity. “The energy bill's priorities are simply wrong, Said Garrett.

“It would take over 2000 mammoth one giga-watt radioactive fueled nuclear power plants to make up oil's decline. Storing and protecting the radioactive wastes these nuclear plants will produce prohibits nuclear power from being cost effective.” Said McAlister

McAlister continued, “Congress' energy bill amounts to little more than a Big Oil boondoggle and a multi-billion dollar giveaway to giant energy corporations. It puts taxpayer money in the wrong place, at the wrong time and for the wrong reasons. It continues short-changing abundant solar resources and it fails to equalize subsidies and policy advantages between depletable energy and undepletable energy. The bill should be dubbed “The Great Mistake”

“By passing this bill, Congress sent a message to America's friends and foes that the United States has surrendered its energy future to those who hold the oil when it needed to send a Declaration of Energy Independence and set an undepletable energy policy to back it up.” said Garrett.

For more information:
www.cleanpeace.org


Thursday, July 28, 2005

The Peak Oil Crisis: A Mid-Summer Review

Falls Church News-Press

By Tom Whipple

The world has never been to peak oil before so we may not immediately recognize what we are seeing. A few months back, most knowledgeable people would have said oil at $60 a barrel would have triggered an economic tsunami by now. But surprise! Here we are and it seems to be business as usual in America with company earnings doing well, the stock market setting some new highs, and thanks to great prices, SUVs and pickups are leaping off dealers' floors and onto America 's highways.

So far this summer oil prices have been jumping up and down depending on which hurricane is or isn't threatening which offshore oilfield, the weekly US oil stocks report, and a little "what is happening in China?" thrown in. The International Energy Agency (keeper of the books on the world's oil supplies and who incidentally haven't had much of a track record recently) says demand — especially from China — is not what it was supposed to be this year, so we can all relax for a while and enjoy the rest of the summer. It may not be 1914 redux after all.

Below the radar of even the most attentive newspaper readers, however, the first stirrings of peak oil reality are starting to trickle in. Not surprisingly, most of these reports come from the poorer parts of the world where $60 oil is simply too much for fragile economies.

Here are a few of the items:

• Last week the BBC reported that dozens were killed in fuel riots across Yemen when the government withdrew subsidies resulting in dramatic price increases.

• All across Indonesia people were lining up at gas stations in response to developing fuel shortages. In one city, half the public transport was inoperable due to a lack of fuel.

• In Zimbabwe , the government has moved to deregulate fuel procurement in the face of severe shortages: waits of hours for buses, gas lines that are blocks long, and a bread shortage. The black market price for gasoline is now ten times the official rate.

• Nearly all the poorer countries make their electricity using diesel generators. Nicaragua , one of the poorest countries in Central America , recently started blacking out the poorer districts between 7 and 10 p.m. , the hours of peak usage.

• Tanzania , with the highest gasoline taxes in East Africa and a chaotic oil marketing system, is seeing its plans for economic growth "suffocated" by high-priced oil. Tanzania also handles fuel for the landlocked states of Malawi , Rwanda , the Eastern Congo , Burundi and Uganda .

• And closer to home, Maxjet put off plans to offer cheap flights from Baltimore to London until spring when the company hopes fuel prices will be cheaper.

At mid-summer, the supply-demand situation remains about the same. OPEC is supposed to be increasing its daily output by some 500K barrels a day and there is evidence from increased tanker charters that this indeed may be happening. In the meantime, production in the non-OPEC countries seems to have dropped by a collective 1.2 million barrels a day below the IEA forecasts for the first half.

Thus, we have learned that $60 oil and the ensuing $2.30 gasoline is not much of deterrent to American driving habits. It is not doing much to the economy, and certainly isn’t stirring up any serious action in the Congress which continues to fuss around with a largely meaningless energy bill. With good economic growth, the US demand for oil continues to increase.

The Chinese continue to claim their economy is growing nicely, suggesting increased demand for oil in the near future.

OPEC and the Russians — the folks with some spare capacity left — seem to have at least squeezed out one last round of production increases in response to calls to stem growth-endangering higher prices. At the same time, many of the world's older non-OPEC oil fields are talking of dramatic drops in production.

If one puts all this together, it is hard to escape the conclusion we just may be very close to Hubbert's peak right now and, some day, 2005 will be declared the year of peak oil.


Strapped commuters seek fuel bargains

Philadelphia Daily News

By WILLIAM BUNCH

THE MOTHER of nine, Stacy Moore of Hunting Park drives a big car - a Nissan Quest mini-van - with a big fuel tank. She also has a big commute between her two jobs - one in Northeast Philadelphia and the other in South Jersey - so it's important to her to buy gas in the Garden State, where it's cheaper than in her neighborhood.

Very important.

"I will drive on 'E' to get here," said the 37-year-old Philadelphian, as an attendant gave her $20 worth - only half a tank - at the Wawa gas station on Route 73, a mile or so east of the Tacony-Palmyra Bridge. One day last week, a majority of the customers at the pumps in Pennsauken were from Pennsylvania, lured by prices of $2.229 a gallon, or 18 cents less than the Philly average.

It's fairly common for motorists to drive out of their way to find the lowest gas prices, but Moore is also typical in that she hasn't made any major change in the number of miles she drives each week. She can't quit her jobs, although she conceded she's been less generous in offering rides to family members.

Experts say that high gasoline prices could ultimately reshape the Philadelphia economy - forcing more commuters onto mass transit and more development at rail and subway stops, crimping the city's surging airline traffic, and causing economic pain for small businesses.

Average Philadelphia prices hit an all-time high last week of $2.42 per gallon for regular unleaded gasoline. This week, the average is only a penny lower at $2.41 - but major changes in the economy or even in everyday driving habits seem a long way away.

Like a millionaire baseball owner who's willing to spend $200 million and break the bank to win a World Series, Americans' spending on their automobiles defies any economic logic of supply and demand. This May, when prices were in the midst of their record runup, U.S. gasoline consumption was actually 1 percent higher than in May 2004.

The result of sky-high gas prices, so far, has been nothing like the long lines and consumer panic of the 1973-74 Arab oil embargo, or the crushing recession when prices hit their inflation-adjusted records in 1979-81.

This time around, adjustments have been minor. Small businesses have been passing along price increases when they can. Individuals are trying to drive less, although they say that's hard when most driving is for work and family activities. They talk of buying a more fuel-efficient car when the one they drive now gives out.

Drivers are angry, but not filled with rage - not yet.

"It makes me really mad," said Anne Martella, a 38-year-old Philadelphia bartender, as the Wawa attendant pumped $23 of gas into her Cutlass Supreme. "But I can't change my habits - you've got to do what you've got to do."

In May, 66 percent of drivers who took an on-line survey for the Progressive Group of Insurance Companies said they would change their driving habits at $2.40 a gallon - the level that Philadelphia is at right now. The number jumps to 78 percent at $3 a gallon, which is a price point at which some experts think drivers really would cut back - instead of just talking about it.

Likewise, a statewide Issue PA/Pew Poll showed 72 percent of motorists shopping for cheaper gas and majorities saying

they've cut back on driving a bit and have seriously considered buying a car with better gas mileage. But while 29 percent of Philadelphia poll respondents claimed they are taking mass transit more, SEPTA officials have not seen any increase in the number of passengers.

Richard Maloney, the spokesman for the transit agency, said that based on past experience, it would take at least three or four months of sustained record gas prices for a noticeable rise in commuters taking rail or buses.

"History has told us that we really don't see a spike - or just see a small spike - until a number of months after an event," said Maloney, noting that a switch from commuting by car to mass transit is a major lifestyle change.

Joel Naroff, the chief economist for Commerce Bank, said that many consumers simply try to absorb the extra $10-$20 a week they've been spending on gasoline, although over time there will be an impact of all the dollars taken from the economy.

"The people who are hurt are low or middle income people who have to drive to work and can't escape it," Naroff added. "It's essentially money out of their pocket that they can't spend on anything else. They're just sucking it up."

Likewise, within the business community, the pain has not been spread equally.

The higher oil prices have begun to take a serious toll on the nation's airlines. But unusual market conditions here in Philadelphia have analysts saying there will not be a major crimp in the surge in traffic that started 14 months ago with the local arrival of Southwest Airlines.

"Philadelphia is in pretty good shape right now," said James Corridore, an airline industry analyst for Standard & Poor's Corp. He said that Southwest's reliance on long-term fuel contracts has insulated it from price shocks, while rival US Airways is looking at a $1 billion infusion of cash in its pending merger with America West.

Not in as good shape: Small businesses such as pizza delivery restaurants and general contractors.

Bob Petril, a manager at the ever-busy City Pizza at 16th and Oregon in South Philadelphia, said that while higher gas costs for its delivery drivers is one problem, customers don't realize that fuel costs are making his raw supplies more expensive, too.

"It's kind of like the snowball effect," he said. Like small business owners, Petril said he's had to pass some of the price increases onto customers, and absorb the rest.

"We try not to make too many unneeded trips," said Ray Smith, a radio tower repairman out of Sounderton. "It used to be that if we forgot a piece of steel, we would just run back to get it."

As Smith spoke at the Pennsauken service station, an attendant pumped $19 - half a tank - into his tailer-hauling GMC truck. Smith ran after him, saying: "Hey, I want the other half!"

The bad news is that some experts believe that $19 for a half a tank of gas may look pretty good some day.

In the short run, some experts believe that major geopolitical disruptions to the oil supply - such as a terrorist attack in Saudi Arabia, the world's largest producer - could cause an unprecedented spike.

Last month, a group called Securing America's Future Energy and the National Commission on Energy Policy sponsored an oil "war game" with former top government officials, and a six-month series of mock disruptions drove oil to $120 a barrel - double the current price - and a gallon of gas to $5.30.

Depressing as that may sound, there is a growing group of energy experts who also believe that the earth is approaching what they call "Peak Oil' - the time when the world's use of oil exceeds what it can produce - faster than expected.

The most pessimistic energy experts - including several widely respected ones - believe that Peak Oil could come by the end of this decade, especially if the demand for fuel from a booming Asian economy continues to remain high.

Even the more optimistic reports from the federal government say that Peak Oil - with its threat of massive global upheavals - could come by mid-century, when a child born today would be just 45.

Still, some are not worried. William Klotsas, a 74-year-old retired engineer from Andorra getting his tank filled in New Jersey, recalled paying 10.9 cents a gallon during a corner price war in the 1950s.

Have rising pump prices affected him over the years?

"I still live poorly," he quipped.


Past its Peak?

Fairfield County Weekly

Cheap oil is probably gone forever

by Jim Motavalli

Are you worried about "peak oil" yet? You should be. An ever-expanding cast of oil geologists, futurists, environmentalists and world leaders are very concerned indeed. Consider the message of books like Twilight in the Desert,

The End of Oil , The Long Emergency: Surviving the End of the Oil Age... , Beyond Oil , Power Down and Party's Over: Oil, War and the Fate of Industrial Societies , a collection about an increasingly likely fate.

I interviewed Matthew Simmons, a respected oil analyst and sometime adviser to the Bush administration, about his theses in Twilight in the Desert . Simmons says Saudi Arabia is at or near oil peak, and that both Iran and Iraq are past peak. His conjecture about the Saudis is pretty sobering, considering that all of our energy projections are based on their ability to open the spigots wider and deliver 15 million barrels of oil per day.

Simmons says, "Saudi Arabian oil production is at or very near its peak sustainable volume (if it did not, in fact peak almost 25 years ago), and is likely to go into decline in the very foreseeable future [emphasis in the original]. There is only a small probability that Saudi Arabia will ever deliver the quantities of petroleum that are assigned to it in all the major forecasts of world oil production and consumption."

Today's analysts and geologists follow trends in global oil field discovery and make an educated guess when the peak of production will occur. World oil discovery actually peaked in 1965, so the fact that the industry is finding less and less oil is very troubling.

Expert opinion varies on when oil peak will be reached. Ali Samsan Bakhitari, vice president of Iran's national oil company, puts the date at 2006 or 2007; oil company geologist Colin Campbell at around 2010; the nonprofit World Energy Council says sometime after 2010; and Royal Dutch Shell says it will be 2025 or later. "The crisis is very, very near," says Bakhitari.

A new report entitled "Peaking of World Oil Production" by Robert L. Hirsch makes sobering reading. Hirsch is not some think-tank intellectual: He is a former VP of Arco and RAND senior energy analyst.

Hirsch makes note of our 210 million gas-guzzling cars and trucks, and the nine to 15 years it normally takes to replace half of them. "While significant improvements in fuel efficiency are possible in automobiles and light trucks," he writes, "any affordable approach to upgrading will be inherently time-consuming, requiring more than a decade to achieve significant overall fuel efficiency improvement." Uh oh.

But then there's this: "The problems associated with world oil production peaking will not be temporary, and past 'energy crisis' experience will provide relatively little guidance. The challenge of oil peaking deserves immediate, serious attention if risks are to be fully understood and mitigation begun on a timely basis." Hirsch concludes that the only way to avoid a serious shortfall of motor fuels is to begin planning to replace oil 20 years before the peak period is reached. But as we've already seen, the critical peak year may be much closer than that already.

Read the entire Hirsch report at www.mnforsustain.org/oil_peaking_of_world_oil_production_study_hirsch.htm.


As oil ceases to be cheap and reserves start to deplete, we will be left with an enormous surplus population that the earth will not support

New Statesman

James Howard Kunstler

 

Somehow we have persuaded ourselves that fossil fuels will never run out. But they will, and much sooner than we think. In an extract from his chilling new book, James Howard Kunstler describes the long emergency that lies before us

Carl Jung famously remarked that "people cannot stand too much reality". What follows may challenge your assumptions about the kind of world we live in, and especially the kind of world into which time and events are propelling us. We are in for a rough ride through uncharted territory.

Our war against militant Islamic fundamentalism is only one element among an array of events already under way that will alter our relations with the rest of the world, and compel us to live differently at home whether we like it or not. Above all, and most immediately, we face the end of the cheap fossil fuel era. It is no exaggeration to state that reliable supplies of cheap oil and natural gas underlie everything we identify as a benefit of modern life. All the necessities, comforts, luxuries and miracles of our time - central heating, air-conditioning, cars, airplanes, electric lighting, cheap clothing, recorded music, movies, supermarkets, power tools, hip replacement surgery, the national defences, you name it - owe their origins or continued existence in one way or another to cheap fossil fuels. Even our nuclear power plants ultimately depend on cheap oil and gas for the procedures of construction, maintenance, and extracting and processing nuclear fuels.

The blandishments of cheap oil and gas were so seductive, and induced such transports of mesmerising contentment, that we ceased paying attention to the essential nature of these miraculous gifts from the earth: that they exist in finite, non-renewable supplies, unevenly distributed around the world. To aggravate matters, the wonders of steady technological progress under the reign of oil have tricked us into a kind of "Jiminy Cricket syndrome", leading many to believe that anything we wish for hard enough can come true. These days, even people who ought to know better are wishing ardently that a smooth, seamless transition from fossil fuels to their putative replacements - hydrogen, solar power, whatever - lies just a few years ahead. This is a dangerous fantasy. The true best-case scenario may be that it will take decades to develop some of these technologies - meaning that we can expect an extremely turbulent interval between the end of cheap oil and whatever comes next. A more likely scenario is that new fuels and technologies may never replace fossil fuels at the rate, scale and manner that the world currently consumes them.

What is generally not comprehended is that the developed world will begin to suffer long before the oil and gas actually run out. The western way of life - which is now virtually synonymous with suburbia - can run only on reliable supplies of dependably cheap oil and gas. Even mild-to-moderate deviations in either price or supply will crush our economy and make the logistics of daily life impossible. Fossil fuel reserves are not scattered equally around the world. They tend to be concentrated in places where the native peoples don't like the west, places physically very remote, places where we exercise little control.

The decline of fossil fuels is certain to ignite chronic strife between nations contesting the remaining supplies. These resource wars have already begun. There will be more of them. They are likely to grind on for decades. They will only aggravate a situation that, in and of itself, could bring down civilisations. The extent of suffering in the west will certainly depend on how tenaciously we attempt to cling to obsolete habits, customs and assumptions - for instance, how fiercely we decide to fight to maintain suburban lifestyles which simply cannot be rational-ised any longer.

It has been estimated that the world population stood at one billion around the early 1800s, which was roughly when industrialisation began to gain traction. It has been inferred from this that a billion people is about the limit that the planet Earth can support when it is run on a non-industrial basis. The world population is now past six and a half billion, having more than doubled since my childhood in the 1950s. The mid-20th century was a time of rising anxiety over the "population explosion". The marvellous technolo-gical victory over food shortages, including the "green revolution" in crop yields, accelerated the already robust leap in world population that had begun with modernity. Dramatic improvements in sanitation and medicine extended lives. Industry sopped up expanding populations and reassigned them from rural lands to work in the burgeoning cities. The perceived ability of the world to accommodate these newcomers and latecomers in a wholly new disposition of social and economic arran-gements seemed to be the final nail in the coffin of Thomas Robert Malthus, the much-abused author of An Essay on the Principle of Population, as it Affects the Future Improvement of Society (1798).

Malthus (1766-1834), an English country clergyman, has been the whipping boy of idealists and techno-optimists for 200 years. His famous essay proposed that human population, if unconstrained, would grow exponentially while food supplies grew only arithmetically, and that therefore population growth faced strict and inevitable natural limits. I would argue that Malthus was correct, but that cheap oil has skewed the equation over the past hundred years while the human race has enjoyed an unprecedented orgy of non-renewable condensed solar energy accumulated over aeons of prehistory. The "green revolution" in crop yields was minimally about scientific innovation in crop genetics and mostly about dumping huge amounts of fertilisers and pesticides made out of fossil fuels on to crops, as well as employing irrigation at a fantastic scale, made possible by abundant oil and gas. The cheap-oil age created an artificial bubble of plenitude for a period not much longer than a human lifetime, a century. Within that comfortable bubble the idea took hold that only grouches, spoilsports and godless maniacs considered population hypergrowth a problem, and that it was indecent even to raise the issue. I hazard to assert that as oil ceases to be cheap and world reserves move towards depletion, we will suddenly be left with an enormous surplus population that the ecology of Planet Earth will not support. No political programme of birth control will avail. The people are already here.



The so-called global economy was not a permanent institution, as some seem to believe, but a set of transient circumstances peculiar to a certain time: the Indian summer of the fossil fuel era. What primarily made it possible was a world-scaled oil market allocation system able to operate in an extraordinary sustained period of relative world peace. Cheap oil, available everywhere, along with ubiquitous machines for making other machines, neutralised many former comparative advantages, especially of geography, while creating new ones - hyper-cheap labour, for instance. It no longer mattered where a nation was situated, or whether it had any prior experience with manu- facturing. Cheap oil brought electricity to distant parts of the world where ancient traditional societies had previously depended on renewables such as wood and dung, mainly for cooking. Factories could be started up in countries such as Sri Lanka and Malaysia, where swollen populations provided trainable workers willing to labour for much less than those in the United States or Europe. Products then moved around the globe in a highly rationalised system, not unlike the oil allocation system, using immense vessels, automated port facilities, and truck-scaled shipping containers at a minuscule cost-per-unit of whatever was made and transported. Shirts or coffee-makers manufactured 12,000 miles away could be shipped to Wal-Marts all over America and sold cheaply.

The ability to globalise industrial manufacturing this way stimulated a worldwide movement to relax trade barriers that had existed previously to fortify earlier comparative advantages, which were now deemed obsolete. The idea was that a rising tide of increased world trade would lift all boats. The period (roughly 1980-2001) during which international treaties relaxing trade barriers were made - the General Agreements on Tariffs and Trade (Gatt) - coincided with a steep and persistent drop in world oil and gas prices which occurred precisely because the oil crises of the 1970s had stimulated so much frantic drilling and extraction that a 20-year oil glut ensued. The glut, in turn, allowed world leaders to forget that the globalism they were engineering depended wholly on non-renewable fossil fuels and the fragile political arrangements which allowed their distribution. The silly idea took hold in the west that the 1970s oil crises had been fake emergencies, and that oil was now super-abundant. This was a misunderstanding of the fact that the North Sea and Alaskan North Slope oilfields had temporarily saved the industrial west when they became operative in the early 1980s, postponing the fossil fuel depletion towards which the world has been inexorably moving.

Meanwhile, among economists and government figures, globalism developed the sexy glow of an intellectual fad. Globalism allowed them to believe that burgeoning wealth in the developed countries, and the spread of industrial activity to formerly primitive regions, was based on the potency of their own ideas and policies rather than on cheap oil. Margaret Thatcher's apparent success in turning around Britain's sclerotic economy was an advertisement for these policies, which included a heavy dose of privatisation and deregulation. What globalism overlooked, however, was that Thatcher's success in reviving Britain coincided with a fantastic new revenue stream from North Sea oil, as quaint old Britannia became energy-self-sufficient and a net energy-exporting nation for the first time since the heyday of coal. Then, when Ronald Reagan became US president in 1981, globalism infected America. Reagan's "supply-side" economic advisers sold a set of fiscal ideas that neatly fitted with the new notions about free trade and deregulation: chiefly that hugely reducing taxes would result in greater revenues as the greater aggregate of business activity generated a greater aggregate of taxes, even at lower rates. (What it actually generated was a huge government deficit.)

Globalism as we have known it is in the process of ending. Its demise will coincide with the end of the cheap-oil age. For better or worse, many of the circumstances we associate with globalism will be reversed. Markets will close as political turbulence and military mischief interrupt trade relations. Societies will turn increasingly to import replacement for economic survival. The cost of transport will no longer be negligible in a post-cheap-oil age. Many of our agricultural products will have to be produced closer to home, and probably by more intensive hand labour as oil and natural-gas supplies become increasingly unstable. The world will stop shrinking and become larger again. Virtually all the economic relationships among persons, nations and institutions, things that we have taken for granted, will radically change. Life will become intensely and increasingly local.



Much of the west finds itself nearing the end of the cheap-oil age having invested its wealth in a living arrangement - suburban sprawl - that has no future. When media commentators cast about struggling to explain what is happening economically, they uniformly overlook the colossal misinvestment that suburbia represents - a prodigious, unparalleled misallocation of resources. This is quite apart from its social, spiritual and ecological deficiencies as an everyday environment. We constructed an armature for daily living that simply won't work without liberal supplies of cheap oil, and very soon we will be without both the oil needed to run it and the wealth needed to replace it. Nor are we likely to come up with a miraculous energy replacement for oil that will allow us to run all this everyday infrastructure even remotely the same way.

The tragic truth is that much of suburbia is unreformable. It does not lend itself to being retrofitted in the kind of smaller-scaled, more finely grained, walkable environments that we will need to carry on daily life in the coming age of greatly reduced motoring. Nor is a Jolly Green Giant going to pick up the millions of suburban houses on their half-acre plots on cul-de-sac streets and set them back down closer together to make more civic environments. Instead, this suburban real estate, including the chipboard and vinyl McHouses, the strip malls, the office parks and all the other components, will enter a phase of rapid and cruel devaluation. Many suburban subdivisions will become the slums of the future.

As the suburbs disintegrate, we will be lucky if we can reconstitute our existing towns and cities brick by brick and street by street, painfully by hand. Our bigger cities will be in trouble, and some of them may not remain habitable - especially if the natural-gas supply problem proves to be as dire as it now appears and the electric power generation that depends on it becomes erratic. Skyscrapers will prove to be more experimental than we had come to think. In general, we will probably have to return to a settlement pattern of towns and small cities surrounded by intensively cultivated agricultural hinterlands. When that happens, we will be a far less affluent society and the amount, scale and increment of new building will seem very modest by current standards. We will have access to far fewer, if any, modular building systems. Construction will be much more dependent on traditional masonry, carpentry and other journeyman skills. Increasingly our building and zoning laws will be ignored. If we return to a human scale of building, there is a good chance that our new urban quarters will be more humane and beautiful. The automobile era proved that people easily tolerated ugly, utilitarian buildings and horrible streetscapes as long as they had the compensation of being able to escape quickly in cars appointed with the finest digital stereo sound, air-conditioning and cup holders for iced beverages. This will change radically. There will be far less motoring. The future will be much more about staying where you are than travelling incessantly from place to place.

We are about to enter an era of tremendous trauma for the human race. It is likely to entail political turbulence every bit as extreme as the economic conditions that prompt it. We will not believe that this is happening to us, that 200 years of modernity can be brought to its knees by a worldwide power shortage. The prospect will be so grim that many individuals, and even whole countries, may become suicidally depressed. The survivors will have to cultivate a religion of hope - that is, a deep and comprehensive belief that humanity is worth carrying on.

If it happens that the human race doesn't make it, then the fact that we were here once will not be altered: that once upon a time we peopled this astonishing blue planet, and wondered intelligently at everything about it and the other things that lived here with us on it; that we celebrated the beauty of it in music, art, architecture, literature and dance; that there were times when we approached something godlike in our abilities and aspirations. We emerged out of depthless mystery, and back into mystery we returned; and, in the end, the mystery is all there is.

This is an edited extract from The Long Emergency: surviving the converging catastrophes of the 21st century, published on 5 August by Atlantic Books


Wednesday, July 27, 2005

ODOT'S PEAK AT THE FUTURE - State report forecasts the end of cheap oil - and it could be soon.

Willamette Week Online

BY ADRIAN CHEN

In theory, there are few things less terrifying than an Oregon Department of Transportation report detailing a pilot program to tax motorists by mileage driven.

But tucked into the 55-page report on the possibility of trading taxes by the gallon for taxes by the mile (see "Back-Seat Big Brother," May 25, 2005) is one passage that-if you like highway travel and the American Way of Life-is more than a little frightening.

"Some petroleum industry experts predict that before 2010 the world production of conventional oil will crest and enter a permanent decline," the report states under the heading "Peak Oil."

Peak oil is the theory that, due to a finite supply of petroleum, the world's production must soon fall.

With rising gas prices and China's growing petroleum demand, peak oil has become an increasingly hot topic. Books and websites declare the end of the oil era, while Big Oil says the peak could be at least 100 years away.

The ODOT report released this month takes a more pessimistic tone. "There's no controversy over the idea of a peak," says the report's author, James Whitty. "The question is: When will it happen?"

After the peak, the report says, increasingly fuel-efficient vehicles will render the 24-cent-per gallon gas tax useless to fund road repairs. (Read the report at www.oregon.gov/ODOT/HWY/OIPP/ruftf_reports.shtml.)

What the report doesn't address is the theory's bleaker side: Competition for dwindling oil reserves could lead to nuclear war, economic catastrophe or-if you're a real pessimist-the end of civilization. By then, potholes might be the last thing on people's minds.


Tuesday, July 26, 2005

The Bush Dilemma -- The Iraq Gamble Simply Cannot Fail

Media Monitors Network

by Stan Moore

"Do not expect the Bush Administration, or any Democratic administration that replaces it to pull out of Iraq. To do so in the face of Peak Oil would be to pull the plug from America's economy, which would be like removing the drain plug from the oil pan of your favorite SUV and driving it until the motor blows."

Iraq is not another Vietnam, when considered from the strategic perspective of American business and economics. Vietnam was a tactical gamble, not a strategic one, even in the war against communism.

From the Bush Administration point of view, as well as that of the "establishment" that includes high level Democrats as well as Republicans, the invasion and occupation of Iraq is a strategic maneuver. It is designed to secure access to oil, not only in Iraq, but also as a lynchpin in a strategy of control of the entire Persian Gulf. It is a lynchpin in a strategy that wants to contain, if not envelope Iran and its oil wealth. The establishment of military bases around the region, after an assumed victory in Iraq, is key to expansion of military access to neighboring Central Asia and the Caspian Sea. This is part of a larger strategy to weaken China and provide leverage against both China and Russia.

It all starts in Iraq. This is the strategic underpinning of the planning and execution for the Pax Americana in the 21st Century. This is the ONLY way that America can dominate the world for the next 100 years.

Not only the Bushites and the Neo-Cons, but also the John Kerry of the world have this strategic view. John Kerry, John McCain, John Warner, and even John Q. Public have been convinced that America's destiny is to rule the world, and it all begins in Iraq, right or wrong. Yes, few in the government worry about right or wrong anymore. What a matter is that might make right, and might is associated with power, and oil power society, and we gotta have control of that oil!

Do not expect the Bush Administration, or any Democratic administration that replaces it to pull out of Iraq. To do so in the face of Peak Oil would be to pull the plug from America's economy, which would be like removing the drain plug from the oil pan of your favorite SUV and driving it until the motor blows.

Iraq was a strategic move. It was a desperate move, but the explanations were designed to hide the REAL desperate explanation of the move, and create a false, desperate explanation. America was facing a desperate situation, but it was not about weapons of mass destruction or about the need for democracy in Iraq. It was about the passage over a mountain peak, the Hubbert Peak. It was about the risk of not having control on the way down the other side of that peak. It was about whether America would free-fall to disaster, or keeps the economy's engine going down the slope, while the rest of the world came to us for their oil.

That is still the American plan. We must control the oil, and if we can't get control, we may have to use nuclear weapons or some other scorched earth policy to ensure that no one dominates us.

Imagine the fear of the German people when the Russians turned the tide at Stalingrad and Leningrad and then came back across the steppes on the way to Berlin, with hatred in their eyes and vengeance in their hearts. Many German civilians were killed, raped, and brutally punished for the sins of their government. America's government will not allow this to happen, at least not by military conquest.

However, economic conquest over America could occur and may occur. If America can't control the oil and dominate commerce of the world through the use of voluntary acceptance of unlimited American debt, America may become the greatest bankruptcy case in the history of the world. If that happens, America will become so poor so fast that the whole world will be shocked and awed.

Nothing good can come from the invasion of Iraq, but America had few choices in order to maintain greed and the unsustainable American way of life. Remember, as Dick Cheney said, the American way of life is non-negotiable, and we know it was also unsustainable. It was a tragedy waiting to happen, and it all begins in earnest in Iraq.


Workers of the World ... at its Peak ... for whom does the oil bell toll?

Vheadline.com

University of Los Andes (ULA) professor Franz J. T. Lee writes: Over the last decades ... from the point of view of the USA ... caught in corporate political and economic fraud and policies that totally ruin capitalism and imperialism themselves, Alan Greenspan regularly has "informed" us about the state of "health" of the world economy. His speeches are excellent examples of bourgeois, capitalist, diplomatic ideology, of not saying this, of not saying that ... so that nobody could say, that he had said so or so.

As such he curries favor with the republican devil and the democratic, deep, blue sea, with Wall Street, with the Bush-Junta.

In spite of the fact that highly respected oil industry experts such as the banker Matt Simmons (of Simmons and Co.), who served on president George W. Bush's Energy Advisory Committee between 2001 and 2004, and the Washington based energy consulting firm PFC Energy, all talk about "Peak Oil," Greenspan never tells us what precisely it is all about; and for the coming decade, what are its immediate consequences and devastating impact for billions of already pauperized, obsolete, manual laborers around the globe.

Furthermore, the application of the United Nations' "occult," strategic plans for the "reduction of world poverty" and the launching of the United States' "Project for a New American Century," including its European and Asian variants, is being hidden from us by the international mass media ... which does not "inform" us ... at what human cost the global power elites intend to postpone the current imminent world energetic Armageddon for a little while, hence giving themselves, as imperialist ruling classes and corporate bosses, as well as the fractional intellectual laboring class, a new lease of life.

In fact, we are finding ourselves, if not in, then definitely at the brink of, a genocidal world war, that is already threatening to throw powerful atomic bombs on North American and Eurasian cities.

For the Bolivarian Revolution in Venezuela and Latin America, for permanent, world socialist creation, concerning the above, in one of my latest commentaries, I have underlined the emancipatory necessity of precise, scientific knowledge and of incisive, philosophic orientation in the launching of immediate social-revolutionary projects, and the successful launching of future, national, medium range, socio-economic plans and also of long-range, international energetic policies.

The oil industry expert, Jan Lundberg, introduces Peak Oil as follows: "The end of abundant, affordable oil is in sight, and the implications are colossal. About now in our hydrocarbon phase of human history, we have pulled out of the Earth approximately half of the available petroleum (crude oil and natural gas). The other half still in the ground is harder to extract and may not -- as assumed -- fuel the global economy or even provide a transition to another phase…"

Concerning the parliamentary discussion of the Australian "Petroleum and Other Legislation Amendment Bill," congressman Andrew McNamara, in his excellent presentation about peak oil and gas, explains to us in a simple and understandable manner the apocalyptic essence of "Peak Oil." He warns: "Peak oil represents the most serious and immediate challenge to our prosperity and security. It will impact on our lives more certainly than terrorism, global warming, nuclear war or bird flu. While it may not be a term with which members are familiar now, I predict it will come to dominate debate in this place over the next 10 years."

Now, concerning the term itself, he explains: "The concept of peak oil was identified in 1956 by the late US oil industry and government geologist M. King Hubbert. Dr. Hubbert suggested that the rise and fall of oil production in a nation, or indeed the world, would follow a pattern for individual wells; that is, rising sharply from when oil under pressure in the ground is first spiked, increasing as more wells are sunk, plateauing when half the oil has been extracted and tapering away as the remaining recoverable oil is pumped out."

This is known as the "Hubbert curve." Hence, having reached the "halfway peak", the trouble really starts: "all oil flows decrease as the pressure in the oil basin declines. The cost of recovering the oil rises exponentially from this point as it has to be extracted with greater degrees of technical difficulty, such as flooding the reservoir with water to float residual oil into a recoverable position."

In spite of the difficulty to acquire precise data, especially with reference to oil reserves, already the US energy administration itself has admitted that its production of oil peaked in 1971; and that probably the production of all oil producing nations outside the Middle East peaked in 1997.

The following indicates how difficult it is to find exact data about oil reserves and future production.

On February 5, 2005, the Royal Dutch/Shell Group was forced to admit that the figure in its 2002 published estimate of its total oil and gas holdings was incorrect. It was totally over-estimated, and the Group had to admit that two-thirds of its listed prospective wells in 2004, turned out to be dry holes in 2005. The Group was fined $US 151.5 million for cheating the international stock markets. Similarly, the estimates of the OPEC oil producing countries change permanently.

As quoted by the above author, according to an article published in the "Scientific American" of March 1998, by Dr. Colin Campbell and Jean Laherrere "...one fact is indisputable: when the Middle East peaks between 2006 and 2020 the world will have passed peak oil, and oil prices will commence to climb irreversibly until recoverable oil reserves are exhausted within 50 years."

Other sources, like the "Business Magazine" of November 7, 2004, inform us that a senior oil industry executive, Francis Harper of BP "expects global oil production to peak between 2010 and 2020."

The USA, with it's "mini-population" as compared to that of China, consumes a quarter of global oil energy, and the energetic demand of fast growing economies like China and India may soon surpass the consumption of the traditional metropolitan industrial countries. Real trouble is brewing on the military horizon.

Furthermore, global oil could peak at any moment, be it tomorrow or in 20 years; however, what does this mean for Venezuela, for the Bolivarian Revolution, in the light of the resuscitation by Venezuelan President Hugo Chavez of an OPEC that was in decomposition and that was converted by him into a revolutionary weapon against the militarization of Oil?

* Remember, that in the 1980s, six of the 11 OPEC countries had revised their oil reserve figures upwards, between 42 and 197 per cent, the scientific accuracy of which is pretty doubtable.

The exact predictability of peak oil gets complicated, taking into consideration the above. But given, that all big oil discoveries themselves peaked 40 years ago, the panorama for Venezuela and OPEC is not bright at all, never mind the upgrading of reserve figures.

Expressed in a different manner, for every four barrels that we consume today, we only discover one. And, as Fidel Castro indicated in an interview a while ago, it is much easier to discover an elephant on the horizon than an ant. All the current small findings, in Guyana or Surinam or elsewhere, in no way approximate the size of the long ago discovered giant oil findings, like the Ghawar fields in Saudi Arabia, that produce eight million barrels a day, and which have peaked already.

At the current level of global production, other fossil energy sources like coal, cannot effectively replace oil. The production processes to convert it into a substitute for oil would use more energy than they produce, hence, they would function as net energy losers. Also, as we know, apart from radiation and storage dangers, nuclear power produces the very same net energy loss problem. And liquefied natural gas is subject to the same Hubbert curve as oil. Including solar energy, and excluding electro-magnetic energy from the vacuum, all other energy sources combined and available to us cannot produce the current, necessary volume of energy we derive from oil.

What awaits us, McNamara portrays as follows: "For some alternative energy sources, such as ethanol, far more energy is expended in planting, fertilizing, growing, harvesting and processing than its end product renders. No other energy source can fly planes or drive heavy trucks and machinery. Further, most of the world's fertilizer is now made from natural gas, and most of the world's pesticide is made from oil. As fuel prices double and then double again in the years after the peak, we will be faced with some very hard choices in the fields of agriculture, food distribution and transport generally."

Concerning the above, like I mentioned in a previous VHeadline commentary, the "wretched of the earth" are in serious trouble, will have to pay the price to rescue the opulent parasites and megalomaniac blood-suckers of this world.

Once more "Les Miserables" are being threatened with murder by social order, as happened to them so many times before, like in the Transatlantic slave trade, like being used as cannon fodder in colonial and imperialist wars, like being extinguished by genocide and torture in concentration camps, perishing in the merciless atomic bombings of Hiroshima and Nagasaki and in the slaughter of a million "communists" in Indonesia, and being massacred nowadays in the Fallujahs of Iraq.

Michael Ruppert, and also Thomas Bearden, in a similar line of arguments I have expressed in previous commentaries, again warn us: "The political fact, however, is that global inertia in response to Peak has driven our species, all of it, past the point of no return. There is no changing course for us. We have committed to a path of bloody destruction that can no longer be postponed or evaded."

Concerning the "path of bloody destruction," Ruppert informs us further: "Battlefield intelligence is a different critter. It presupposes that there is nothing more important than the battle that has been joined at this moment. If the battle is not won, there are no future choices. Hence nothing matters other than the war that is being fought today. No Yaltas or Potsdams; no future deep cover moles will be needed."

"Every country in the world is betting everything it has on this one hand knowing that after 2007 or 2008 the game ends. The map of the future after that is unknowable and, to large extent, irrelevant. That's why Rumsfeld has won the battle to control American intelligence operations and why the new National Intelligence Director John Negroponte is getting the job."

Whether we believe it or not, countries like China are already preparing themselves for the coming collapse of the world economic market, as a result of Peak Oil: "China is experiencing massive shortages of coal to power its electrical generation." - multiple sources.

China is already buying and hoarding 60% of the world's commodities: (Oil, Cement, Aluminum, Copper, Zinc, Manganese, Steel, Coal, Gold, Silver, etc.). It has bought so much cement that it has caused a slowdown in US construction. Last year it bought 90% of the world's steel output and shipped it to China." - multiple sources.

Why?

According to Ruppert: "Because soon there won't be enough fuel for the globalized transport of such heavy things, nor, presumably, for their industrial exploitation. The world may also be at war shortly, further endangering international trade and transport."

Now, although many of us juggle around with concepts like "Children of God," maintaining that "we are all human beings" and that "we all belong to the human race" or "are all Christians," we do have to ask a serious, global, social class question:

Within the next decade, how will the global corporate Moguls and Mongrels solve the "energy crisis"?

* How did they solve all their crises, depressions, recessions and crashes across history?

* How many hundreds of millions did they sacrifice on the burning stake of Moloch?

Who is currently in serious, immediate danger of extinction by the billions, because they do not serve the global class interests of capitalism and imperialism anymore?

Who and What can still save us?

What is, and will be, Global Fascism?

Workers of the World ... at its Peak ... for whom does the oil bell toll?

Franz J. T. Lee
franzjutta@cantv.net


Global oil outlook: over a barrel

www.businessinafrica.net

This crisis isn’t centuries away. The crunch point comes not when we have run all the oil wells dry, but when demand outstrips production - and a growing number of experts are warning that this is likely to happen within the next few years.

"There is a growing consensus that we are heading for an imminent peak in oil production, if not already past it,” Richard Hardman, trustee of the London-based Oil Depletion Analysis Centre and a former president of the UK Geological Society, told the New Scientist magazine as far back as 2003.

In previous crises, new reserves always seem to have been found to make up the shortfall. But the declining rate at which new fi elds are being discovered suggests it won’t happen this time, at least not for conventional oil.

We now find just one barrel of oil for every four we consume.

And with production already declining in the US and the North Sea, the world must rely increasingly on the politically volatile Middle East and other parts of the developing world.

The International Energy Agency (IEA) estimates that the world’s primary energy demand is projected to expand by 60% between 2002 and 2030. It is predicted that oil demand will grow in line with total energy demand.

To meet this demand, Opec would need to double its current production. This is highly unlikely, given that presently it is producing oil at or near maximum capacity, and reinvestment rates, as measured in terms of active drilling rigs, have not accelerated suffi ciently to grow production.

For the full story, get hold of Energy in Africa magazine on the shelves at the end of July.


Peak Oil Principal Savages Oil Majors' "Profits from Scarcity"

Resource Investor

By Adam Porter

Dr. Colin Campbell, founder of the Association for the Study of Peak Oil & Gas (ASPO), has criticised the amount of profits made by the oil majors. The mauling comes, as the majors look set to stun markets with record revenues.

“The oil majors are profiting from scarcity,” Campbell told Resource Investor. “They are raking in the profits because oil is at $60 a barrel and, materially, their costs have remained the same.”

BP [NYSE:BP], Royal Dutch Shell [NYSE:RDS], Exxon-Mobil [NYSE:XOM] and Chevron [NYSE:CVX] are all set to announce their results for the second quarter 2005 this week. Market makers expect a cash bonanza. BP estimated to see its profits balloon to $5.6 billion, up 44% year on year. Newly merged Royal Dutch Shell is expected to trump that, up 46% at $5.4 billion.

Exxon-Mobil and Chevron report on Thursday and Friday. Their share dividends are forecast to jump from 87 cents per share to $1.27 and from $1.53 to $1.69, respectively.

“It’s a windfall for the oil majors,” said Campbell. “An irony about the current situation is that in any normal market a price rise gets people producing more. In this case there is every incentive to do the opposite, so that the majors can make their reserves last longer. In the oil market we have now, high prices actually seem to dampen output.”

Campbell pointed out that the oil majors’ reserves “show no sign of increasing. In fact as they are raking in record profits…it becomes a golden moment to start up a lot of dubious projects, in exploration and drilling. So many of the holes being drilled now are dry ones. Yet so many of these dry holes being drilled mean a reduction in taxes paid by the oil companies. Of course they are offset as running costs against profits,” he claimed.

“As a result if you want to look for good places to invest then the companies that drill and explore are in a great position,” said Campbell. “Those companies profit on both success and failure. The contractors are in a fabulous position. But as far as finding more reserves go, it is not happening. The downward trend is relentless with no sign of it changing.”

Despite forays into more difficult territory, both physical and political, oil majors are still unable to significantly add to their reserves, he says.

“Of course you can always find smidgens here and there, no doubt about that,” he admits. “But you can see by the way the oil companies have been merging and are merging, that this has been the main way they have added to their reserves. By snapping up those of the weaker partner [in the merger].”

“[The oil majors] also thought they would do well in Russia but [President] Putin has been stopping that game,” said Campbell. “He realises that Russia will need its reserves for its own future use. Russia is already making a bundle on exports, but it seems they have planned ahead and see what is happening. They want to keep their oil.”

“As far as the major western companies go, as an example, why would they drill in 6000 metres of water if there were easier, cheaper, deposits to find on land? Again this comes down to being a geological issue.”

But Campbell reserved his harshest criticism for the way that oil executives remunerate themselves, especially at such a volatile time in the oil marketplace.

“It is obscene what these people pay themselves, absolutely obscene. And of course once again these huge payments to executives are included in the balance sheet as running costs, offset against tax. So who is really paying these wages? The company or the taxpayer?”


The 'Peak Oil' Controversy

The Hindu Business Line

Pratap Ravindran

MUCH of the public discourse on the spiralling price of crude has rested on a premise — one that is contrary to at least one fundamental law of physics — that oil will last forever. However, this time around, the reality of an imminent energy crisis will not go away if ignored long enough.

The increasing energy cost of oil creates what can be called a positive feedback loop: As oil is used directly or indirectly in just about every human activity, an increase in the energy cost of oil will result in an increase in the cost of other sources of energy too.

Sooner than later, the consumption of oil is going to exceed its supply. As of now, there is no known substitute for petroleum in terms of quality. The question, therefore, is not `whether' but `when' oil will run out.

Some of those who have been trying to work out the answer have evolved the concept of "peak oil". Dr Kjell Aleklett, a physics professor at Sweden's Upsalla University, and President of the Association for the Study of Peak Oil and Gas, is among the several experts — most of them former oil industry executives and geologists — who hold that there is no room for complacence because the amount of oil now left in the ground is significantly less than what the oil industry would have us believe.

According to Mr Aleklett the world has burned up nearly half of all its oil — an estimated 900 billion barrels of crude — and that, during the next 30 years or so, we will find more than 150 billion, perhaps 200 billion, barrels of oil and that, in the same period, we will consume 1,000 billion barrels of oil. In industry jargon, that halfway point is the "peak", after which reserves no longer rise but drop.

Those sanguine about the continued availability of oil also accept the notion of a peak.

However, they are sceptical about the timing of the warning — around 2008 — being put out by peak oil analysts.

Thus, Mr Michael Lynch, a critic of the "peak oil" movement, argues that Mr Colin Campbell, a geologist and leading spokesperson of the movement, has a long record of making inaccurate predictions. Says Mr Lynch: "The people who predict peak oil have been predicting it any day now for 15 years.

Like Colin Campbell said in 1989 that this is the peak right now, in 1991 he said the peak is next year, and in 1995 he said it's in 1997 and so forth.

I've generally been predicting continued rise (in oil supplies) since I started working on this; really making forecasts in the late 1980s. I think over the next 30 years you won't see a peak unless it is from the demand side."

Oilmen further contend that supplies are actually growing with more oil coming out of Iraq, Russia, the Caspian Sea, Colombia, Sudan and so on.

This, again, is disputed. The US State Department in 1997 put the possible value of Caspian Sea at a staggering $4 trillion, according to Mr Mathew Simmons, an energy investment banker and one-time adviser to the US President, Mr George W. Bush.

One field, Kashagan in Kazakhstan, was touted as being particularly productive. Mr Simmons holds that the Caspian oil and Kashagan have been hyped.

In this respect, he has been quoted by the media as saying: "Now, there is an enormous project that got sanctioned to begin development spending in the middle of 2004 called Kashagan that is being billed by some people as the biggest oilfield found in the last 30 years.

Interestingly enough, three of its original partners who collectively held 30 per cent have already bailed out."

And then again, those who believe that talk of an energy crisis is alarmist insist that if supplies dip and prices rise, the industry will, quite simply, step up exploration.

Further they contend that technology will make it easier to extract oil from places difficult to reach, for instance, the petroleum locked in the sands in Canada.

The peak oil analysts have a different point of view on oil-industry investment patterns, which, they claim, seem to indicate that there is not much oil left to discover. They point out that The Financial Times in 2004 quoted a study by the Scottish energy consultant, Mr Wood Mackenzie, establishing that the major oil companies had invested $35 billion to develop existing oilfields in 1998.

Five years later, in 2003, the amount was $50 billion, a record, according to the Mackenzie study. During the same time period, spending on oil exploration dropped from $11 billion to $8 billion.

Peak oil analysts contend that the oil companies were investing in the development of existing — and not exploration — and that this means that they too are aware that money spent on exploration is likely to prove a waste.

Mr Lynch disagrees with this conclusion. According to him spending on exploration has fallen because companies are drilling even more oil from existing fields. He adds that there are other factors at play as well.

"When you look at oil discoveries and production, these are partly influenced by geology, but they are heavily influenced by politics, economics and infrastructure, and things like that.

So they (the peak oil analysts) are mistakenly assuming that what they are seeing is a lack of oil.

In other words, geology is determining it, when in reality what has happened is that people in the Middle East cut back drilling because they had a huge surplus of oil and they nationalised their operations in the 1970s and so forth."

The position of the oil industry and those who believe that there is no likelihood of the world running out of oil in the near and medium term is very reassuring — but it does not deal with two problems.

One, the distinctly startling observation made by peak oil analysts that major oil finds (more than 500 million barrels) peaked as far back as 1964. In 2000, there were only 13 major oil discoveries; in 2001, six; in 2002, two; and in 2003, none!

Second, the notion of energy sinks. It is obvious that energy sources must produce more energy than they consume. If they do not, they are energy "sinks".

And so, in order to get a correct picture of where we stand, we have to take into account the "energy price".

Energy sources that consume more energy than they produce are manifestly worthless, without reference to the "money price" of energy.

According to peak oil analysts, the world is currently using six barrels of oil to discover one new barrel.

Mr Aleklett and other peak oil analysts assert that the West must mend its profligate ways and control the demand it generates for oil. They have a point: the US has five per cent of the world's population and burns up 25 per cent of its resources.

The US Senate, on June 29, passed with an overwhelming majority, a broad energy legislation, which its authors hope will strike a balance between traditional and alternative sources of power and break a four-year Congressional stalemate over an energy policy.

The legislation includes $14 billion in tax incentives for oil and gas production as also the development of wind, solar and other emerging energy sources, in addition to rewards for buyers of energy-efficient appliances and hybrid cars. In addition, it envisages an additional investment of $36 billion in energy-related projects — although many of them will require approval by Congress.

And therein lies the pinch. On of the factors underlying the clash between the Senate and the House is the latter's own version of the energy measures, which emphasises increased domestic oil and gas production.

Further, the House has taken up a controversial plan to grant product liability immunity to producers of the gasoline additive MTBE, which has polluted groundwater extensively in the US.

Inevitably, given the man occupying it, the White House too does not much care for various parts of the Senate Bill: in specific, its cost and the component requiring utilities to use more renewable fuels to generate electricity. These and related problems are for the people of the US, who put Mr Bush in the White House to sort out.

But the problem is that the imminent energy crisis will affect people across the globe.

It would, therefore, appear that the continuation of the Bush presidency is going to prove disastrous to other countries too — in many more ways than has been anticipated.


CHEVRON SPEAKS UP ON ENERGY DEPLETION

RedNova News

By Russell Ray

Major oil companies have traditionally dismissed and downplayed concerns about depletion of the world's recoverable supply of oil.

"Don't worry," I've heard them say. "The world has enough oil to meet demand for another 100 years."

It's a logical response, if you're a big public oil company.

If investors thought depletion was looming, as many experts contend, the value of oil stocks would decline. If that happens, the value of your company plummets and your borrowing power begins to tailspin.

But attitudes are changing. One major oil company has acknowledged the depletion issue and is warning consumers of a forthcoming energy crisis.

Chevron Corp. has launched a bold advertising campaign that clearly suggests the available supply of oil is near depletion and urges the world to find alternatives before it's too late.

Chevron's campaign to raise awareness and promote discussion of oil depletion and potential solutions is impressive. The advertising is eye-opening.

In one giant ad that appeared Tuesday in The Wall Street Journal, Chevron states: "It took us 125 years to use the first trillion barrels of oil. We'll use the next trillion in 30."

Whoa! What a frightening statement.

The end of oil is just 30 years away. How does an industrialized world function without oil? Unless a viable alternative is conceived, it doesn't. That's the point Chevron is trying to make.

In that same ad, Chevron Chairman David J. O'Reilly says the era of easy oil is over and that political, economic and physical barriers are preventing the exploitation of newfound supplies.

Some day the world will run out of oil. No one knows for sure when that day will come. But the fact that Chevron, the nation's second-largest oil company, is using this kind of language in a global campaign indicates that the day may come sooner rather than later.

If Chevron is right, the world will run out of oil within my lifetime and the lifetime of our children.

As O'Reilly puts it: "What we all do next will determine how well we meet the energy needs of the entire world in this century and beyond."

The best thing about Chevron's energy awareness campaign is that you can participate through an innovative Web site at www.willyoujoinus.com. You can read what others are saying about the world's energy problems as well as share your own energy ideas and solutions.

I scanned some of the discussions. The ideas were interesting.

Making ethanol from cellulose, or plant material, was discussed. The U.S. Senate thought that was a good idea, too, and included a provision subsidizing ethanol made from crop waste in the Senate-passed energy bill.

Other ideas center on greater fuel efficiency for automobiles and increased investments in mass transit.

Thank you, Chevron, for having a social conscience.


Monday, July 25, 2005

All Pumped Out

All Pumped Out

TWILIGHT IN THE DESERT - The Coming Saudi Oil Shock and the World Economy
By Matthew R. Simmons
Wiley; 422pp; $24.95

Click to see this book on Amazon

These are nail-biting times for the oil markets. With demand testing the limits of supply, each bit of threatening news -- whether a hurricane in the Gulf of Mexico or labor strife in Nigeria -- stokes prices that already are at record levels. Now along comes a book, Twilight in the Desert, that aims to smash one of the energy watchers' bedrock assumptions: that in the Middle East, and in Saudi Arabia in particular, oil is "easy to find, cheap to produce, and almost inexhaustible in its supply."

Far from being a reliable source of more and more oil in decades to come, Saudi Arabia's magnificent fields are nearing senescence, argues Matthew R. Simmons, a Houston investment banker and longtime energy Cassandra. "The risk is high," he says, "that twilight may soon descend on oil production in Saudi Arabia."

If Simmons is right, then the global economy has a shock coming. It would be hard to overstate the importance of Saudi Arabia to the world energy picture. Today the kingdom produces around 9.5 million barrels per day, or 11% of world supply. More important, it is widely assumed that the Saudis can, if necessary, dramatically ramp up production over the next couple of decades to satisfy increasing demand. After all, the Saudis estimate their own proved reserves at 262 billion barrels, or 22% of the world's total. But what if they can't increase production, because of a lack of reserves or the means or the will to increase capacity? Or worse, what if production declines? At a minimum the current supply/demand squeeze will continue. A crash in production could be catastrophic.

Simmons bases his arguments on his reading of more than 200 technical papers presented by engineers from Saudi Aramco, the national oil company, and its predecessor, Aramco. These are kept on file at a subscription site of the Society of Petroleum Engineers (www.spe.org). Using this data, Simmons draws a picture of an industry that faces daunting challenges. He reports exhaustively on instances of increased water encroachment into the oil -- a sign of aging fields -- declining reservoir pressure, and depletion of the oil in the kingdom's most prolific rock strata.

Simmons may well be making too dire an interpretation of the engineers' discussions. While there are undoubtedly problems in Saudi fields, there is no sign that overall output in Saudi Arabia is declining. Simmons tends to try to fit every fact into his doomsday thesis. For instance, he says disparagingly that the Hawtah field discovered in 1989 "produces only 200,000 barrels of oil a day."

But that would be a major find anywhere else, and the oil is of excellent quality. Simmons also interprets the Saudis' use of expensive technology as evidence that they are struggling with the ever more difficult problems he has suggested. He underestimates their resolve to lavish on their fields the most sophisticated technology and software money can buy, such as multibranched, horizontal wells with live links to the surface.

All that said, there are many valuable insights in Simmons' book. His basic points are right on target. Saudi Arabia's giant fields are old. Two of its three biggest, Abqaiq and Ghawar, by far the world's largest, were discovered in the 1940s. The third, Safaniya, was discovered in the '50s. These fields, which may account for two-thirds of total Saudi production, have pumped out a tremendous amount of oil by now. Ghawar alone, Simmons says, has over the last half-century produced an astounding 55 billion barrels -- 55% to 65% of total Saudi production. Eventually they will run dry.

Big new finds to supplement these fields are unlikely. "There is no Ghawar lying in wait to be discovered," Sadad Husseini, Saudi Aramco's former head of exploration and production told this reviewer in a telephone interview. Instead, he said, new production will have to come from smaller discoveries and less prolific oil fields that are not being exploited.

Stung by recent criticism that it is no longer a reliable supplier, the kingdom is spending whatever it takes to build up capacity to 12.5 million barrels per day by 2009, an increase that seems possible. But Simmons is probably correct when he says that "it is virtually impossible for Saudi Arabia ever to produce the 20 to 25 million barrels per day envisioned by the forecasters."

And production will likely be increasingly expensive, even in Saudi Arabia. It may not be twilight in the desert, but it is time to rethink our assumptions about where we are going to get our energy.


Couple does its part to avoid guzzling resources

Daily Astorian

By Leanne Josephson

“The party’s over.”

“The mortgage is due.”

“You cannot take more than you put back forever.”

Astorians Caren Black and Christopher Paddon have hundreds of ways to describe peak oil, but they all lead to the same conclusion: Life is going to change dramatically as a result of oil depletion, and that change is happening now.

Peak oil refers to the fact that global oil production is at its height. There is only so much oil in the ground, and the world has produced or is near producing the most it ever will.

In other words, half of the earth’s oil has already been consumed.

Even with a move toward alternative sources of energy, there won’t be enough energy to meet the demands of society. This includes running factories, heating homes, producing pharmaceuticals and fueling the large-scale agriculture that feeds the public.

Black and Paddon’s research over the last decade has led them to establish a nonprofit organization to provide information about peak oil and to discuss its ramifications. The Lifeboat Academy is affiliated with the larger Post Carbon Institute, which explores what culture might look like without the use of hydrocarbons.

The husband-and-wife team are also working on converting their 1970s home and their own lifestyle to sustainability. They hope their home will serve as a demonstration and resource center where people can learn about sustainability and alternative and pre-petroleum technologies.

“We hope to help build a counter-culture that is sustainable, so when the other one goes down you can have the information,” Black says, sitting at a table covered by books published on peak oil. Above her, a single energy-efficient light shines down.

No doubts
For anyone who doubts industrialized countries’ dependence on oil, Black says to pick a product at the grocery store. Take milk. It takes oil to drive to the store to buy the milk, and it takes oil to get the milk to the store in the first place. It takes oil to run the refrigerators that keep the milk cold, and it takes oil to run the milking machines that suck the milk from the cow. Trace it back further, and the cow likely ate feed harvested with a tractor fueled by, what else, oil.

With the use of fossil fuels so integrated into today’s lifestyle, converting to sustainability isn’t an overnight process, and it can’t be done successfully without the support of the community and major investments in the development and production of renewable energy sources, Paddon says.

But the couple says that instead of using the remaining oil to research and develop wind and solar power, current oil supplies are being used to feed the U.S. appetite and to secure the remaining oil fields in the middle east.

“Their entire focus is profit, to make as much as they can in the time that’s left,” Black says.

Black and Paddon are afraid that by the time people wake up to what is going on it will be too expensive to produce and develop alternative energy sources, and there won’t be the fuel to do so.

“There’s a lack of awareness that things will go wrong,” Black says. “Technology will save us. The economy will save us.”

A struggle
But eliminating a dependence on fossil fuels isn’t that easy, they say.

While television commercials are promoting cleaner coal, it still causes acid rain and smog. Most of the easy-to-get coal has already been extracted, which means that eventually it will take more energy to mine the remaining coal than can be produced from the coal itself.

Natural gas isn’t the answer either, because it will peak in 15 years then drop off, Black says.

Paddon and Black call hydrogen power a “diversion to give the public hope.” They say hydrogen production always uses more energy than the resulting hydrogen will yield, and that current hydrogen fuel cells are powered with hydrogen extracted from natural gas.

“Other countries are all aware of peak oil,” Paddon says. “Spain just launched a tidal power plant. Germany is buying solar panels up all over the world.”

The couple say transitioning to a post-petroleum world isn’t a blip of a challenge, or a scare like Y2K. Before the expansive use of fossil fuels, the world’s population was about 1 billion. Today it’s 6.5 billion.

“We cannot feed the earth’s population with current farming methods,” Black said, referring to the reliance on fertilizers that dramatically increase output and the method of transporting food long distances.

What to do?
For now, Black and Paddon are starting by changing their own habits.

“We don’t want to do the hard-core survivalist thing. Hole up in a cabin with ammo. What’s the point in that?” Paddon says.

They’re conserving energy by things as simple as using energy-efficient lightbulbs and hanging their wash to dry outside. They’ve cut their garbage in half, and make sure to separate out burnables and cardboard for mulching. They’ve put thermal windows in their house to make it more efficient.

There’s a “chicken tractor” in the garden, where chickens are put in a tiny house without a floor. There they eat, defecate and scratch, helping with composting and fertilizing the ground. The tractor is moved around the garden to fertilize different areas.

They buy local, organic produce and local materials, and produce some food themselves. An Oberhasli goat, Fanny, gives about 2 quarts of milk a day. Their other goat, Bhri, is still a kid.

They aren’t keeping up the lawn, and will use the yard in the front of the house for a pasture for the Percheran draft horse they plan to purchase, after they finish building the barn.

Solar thermal and photovoltaic cells to provide hot water and some electricity are propped up against an outside wall.

There’s a wood and coal-burning stove in their garage. Rusty farm implements from 100 years ago sit waiting for Paddon to restore them. Even a horse-drawn carriage sits in the garage. But while some of the items are dated, Black says they aren’t trying to go backward.

“We as a culture are not going back to the 1800s,” Black says. “We’re trying to model another way of life.”

Instead they hope to combine current technology with the old, for example, applying regenerative breaking to a horse carriage.

They’re also trying to adopt a positive view of the future, focusing on how the end of fossil fuels might allow people to spend more time with their friends and families.

“We need to look at it as an opportunity to lead a simpler, slower life,” Black says.