Are you ready for the last oil crisis?

This peak oil summary was published in Zadok magazine in November 2005. A year later and the Australian Federal Senate, Swedish Prime Minister, American Congressional taskforce, Pentagon, Dr Karl, Dr David Suzuki and many others are all agreed — we are at peak oil and are not ready!

(This article was quoted in Professor Peter Newman's paper to the Australian Federal Senate Peak Oil taskforce
and cited in Professor Newman's recent "Res Publica" piece.)

Please read this short tour of the end of the oil age.

(Note: Please click on the graphs below if you wish to see them larger and clearer).

What is peak oil?

If you plot the mining of oil from a specific oil field over time, the volumes of oil extracted follow a rough bell curve. Production starts off slow, then as more and more wells are drilled volumes increase until about halfway through the field’s life production plateaus. This is the maximum output you will ever produce from that oil field. This marks the beginning of the end of that oil field’s life. Soon, the oil field goes into decline as the deeper oil takes more energy to extract, and is more expensive to process. All the light sweet crude is gone, and you are now into the heavy crude. You have moved from a growing output of cheap oil to a decreasing output of poor quality oil. This trend can be observed for one field, a collection of fields, a state, an entire nation, and estimates can even be made for the whole world.

Many are saying we are on the peak of world oil production. The “peak” is the most oil we will ever produce annually; only from our immediate vantage point it looks more like a plateau. We may find that 86 million barrels a day is the ceiling of what humanity will ever produce. OPEC have promised to raise daily output a number of times over the past 18 months, but just cannot. In just a few short years we may be able to see the beginning of the energy down slope.

If we really are at peak oil production, it means we have burnt all the easy to access oil, all the ‘low hanging fruit’. As National Geographic puts it, ‘Humanity’s way of life is on a collision course with geology — with the stark fact that the Earth holds a finite supply of oil… The peak will be a watershed moment, marking the change from an increasing supply of cheap oil to a dwindling supply of expensive oil.’ (National Geographic, June 2004, page 88.)

New discoveries will not save us. Discovery peaked in the 1960’s, and so we are now consuming 4 barrels of oil energy for every barrel discovered.

The Deputy Prime Minister of Australia, John Anderson, and celebrity scientists Dr Karl Kruszelnicki of Australia and David Suzuki of Canada have stated that they believe we are near the peak. Yesterday Exxon-Mobile quietly announced that all non-OPEC oil producing nations would peak in the next 5 years. The world will then rely on OPEC to supply any increase in demand — which they apparently cannot do. The same article also stated that oil demand would increase by a million barrels per day each year after 2010. With China and India coming online as oil consuming nations, demand for oil has never been higher. It appears demand has already caught supply, and the price of oil is rising as a result.

Consequences

But what will happen as oil extraction actually slows down each and every year after the peak? Put simply, the economic consequences will be catastrophic. It will be like the 1970’s oil crisis, but this time it is here to stay.

Oil is the lifeblood of our civilization. Not only does oil provide 90% of transport energy, but it also provides the feedstock for our chemical and plastics industry, the bitumen for our roads, pharmaceutical inputs, and most importantly oil provides the raw ingredients for making pesticides. Oil is food. Some have calculated that it takes ten calories of oil and gas energy to make just one calorie of food energy. (See “Eating Fossil Fuels”).

The cost of everything that depends on oil will rise. Airlines will become unaffordable to the average citizen and will bankrupt as a result. Once the airlines stop flying the world’s largest employer, international tourism, takes a severe economic hit. Some smaller nations dependent on tourism will become bankrupt. The flow on effects of oil prices skyrocketing out of control will throw us into the Greater Depression. We have left adjusting to the post-oil era too late. Indeed it mystifies me that governments still allow oil dependent suburban sprawl to creep ever further into once profitable agricultural areas.

Overshoot

Hang onto your hats, there’s more. Industrial agriculture is so utterly dependent on oil for both pesticides and transporting NPK fertilizers to our farms that many peak oilers believe humanity is already in a state of worldwide overshoot. The Die-off community basically think our situation is comparable to bacteria in a Petri dish, which has doubled again and again until it is about to hit the walls of the dish. When that happens, the growth medium runs out and the bacteria starve. They argue that oil is the growth medium that has enabled the human population to reach 6 billion. Without oil inputs our farms have only dead dirt and our crop yields will collapse. The human population may have to “adjust” to pre-industrial revolution agricultural numbers. Die-off.

I will not expand on the many die-off scenarios that illustrate the potential for anarchic collapse and resulting starvation. I do not hold that die-off is inevitable. However, when a conservative Republican Senator with a previous career in science teaching can stand up in the American Congress and quote: "Dear Readers, civilization as we know it is coming to an end soon", we know that something is awry. (See Life after the oil crash.net). Indeed, if oil depletion is imminent then the outlook for civilization really does appear far more alarming than even the Pulitzer Prize winning Jared Diamond has visualized in his book, “Collapse”. He hardly mentions peak oil, even though he highlighted Australia as being on the knife-edge of collapse because of our poor soils.

The technical issues

Right now I bet you are trying to remember every renewable energy scheme you have ever come across. I’ve been there, madly scouring the internet day and night studying wind, solar, bio-mass, geothermal, tidal, wave and OTEC energy. There are some truly remarkable schemes to harness renewable sources of energy. (My favourite is the 1 kilometre high Solar Chimney just for its sheer audacity, engineering beauty and simplicity.)

However, the technical challenges are vast. Let me help you start asking the right questions before you assume you have an easy solution.

1/ EPR.

EPR is the Energy Production Ratio. It asks how much energy you get back for all the energy you put in to building the power plant, transporting materials, etc. For example, in the early days of oil mining you just drilled a well and hit a gusher, allowing the EPR to be as high as 100. That’s 100 times the Energy Returned on the Energy Invested. (Also known as ERoEI). A little exploration and drilling and you had an EPR of 100. Now that oil fields are so hard to find, and so expensive to drill (such as deep sea beds) the EPR of oil is only about 8, which is also another indicator that oil is about to peak. (Remember it costs more and more energy to get the last few scraps of oil, and so the energy profit ratio starts to decline after the peak.)

But what are the EPR’s of renewable energy? Some studies argue that solar cells are net energy losers! The solar cell energy payback studies often omit such basic energy inputs as the energy required to construct the solar cells factory. That’s a bit like ignoring the dome of a nuclear power plant, or the deep-sea rig used to mine the oil! Even so, this is how the EPR figures are often “cooked”. When the energy costs are properly measured, some conclude that solar cells are merely converting cheap fossil fuels into expensive silicon cell electricity.

In a similar fashion the EPR for many alternatives is poor.

Most bio-fuels have a poor or negative EPR because of the high-energy input from oil pesticides and gas manufactured fertilizers. Hydrogen has a negative EPR, you have to burn more electricity to manufacture it than you get back in the hydrogen. (Second law of thermodynamics.) The EPR is one of the most important questions when considering alternative energies.

2/ Volumes.

Will the renewable energy produce the volumes of fuel we need? Some people recommend bio-fuels, but my current figures tell me that growing any crop for fuel would quickly compete with farmland and still only give us a tiny fraction of the transport fuel we need. It becomes a choice between fuel and food, to mention nothing of the dangers of damaging more soil. Always check if the renewable energy can satisfy the sheer quantities of today’s energy use.

3/ Sustainability.

I mentioned depleted soils above as one example of whether or not an energy source was sustainable. There’s no point getting hooked on bio-diesel if within a few years the soil dies and fuel crops fail. There’s no point building hundreds of expensive nuclear power plants if we then reach peak uranium in few decades.

4/ Ease of transportation.

Is the fuel easy to move and freight? Even if you managed to manufacture enough hydrogen, how do you move it? Hydrogen leaks. It needs to be condensed and frozen. It needs a different piping infrastructure. Shipping hydrogen requires a completely different and much more expensive tanker, and the road freight of hydrogen is also problematic.

Summing up the technical challenges

There are many other questions of cost, time to implement, and infrastructure needs. What will we use to replace plastics? What about power backup for when the wind doesn’t blow and the sun doesn’t shine? If we want industrial civilization to survive these technical issues must be solved quickly as we prioritise the remaining fossil fuels into renewable energy.

We do have some amazing new technologies. We also have eco-city designs that save energy, are better for the environment and health of citizens, and would allow a very comfortable lifestyle in a city designed around communities and moving people, not cars. Yet it is all too little too late. After carefully investigating this matter for nearly a year now, I have become increasingly alarmed at how difficult it will be for our society to wean itself off our oil addiction. The Hirsch report to the US Department of Energy concluded it would take 20 years to wean off oil. Yet our governments are still sleepwalking into this crisis.

Peak oil leaves me questioning the ethical basis of our whole first world way of life. Sustainability is now a matter of conscience affecting a Christian approach to social justice and poverty. This planet has limited energy resources that the first world has largely consumed at the expense of developing nations. Furthermore, we are taxing the next generation and leaving behind problems with pollution, topsoil degradation, depleted fisheries, rare mineral depletion, water table depletion, clear felling of old growth forest, erosion, and global warming. My own personal Christian response to peak oil is best described by the following quote. “If I cannot extrapolate my standard of living to the whole world and still find nature flourishing, my standard of living is immoral." (John Carmody, Ecology and Religion, p. 134.)

End of part one.

My main website is now a blog at EclipseNow.blogspot.com