[Peakoil] The death of peak oil

[Michael Skeggs mike@bystander.net]

I know you don't need reminding that peak oil is about peak extraction
rates, not overall reserves. If large reserves were tied up in
impermeable rock which limited the rate of extraction, you could have
a large resource that had little impact on peak timing. Ooh. That's
what oil shale is.
Note also, there is no mention of EROI. If it takes a large amount of
energy to extract some oil from rock, it is much less useful. If it
takes 1/4 of a barrel of oil to extract 1 barrel then we could see
total oil production rise with no meaningful net oil availability.
Remember, too, that peak oil is about the end of cheap oil. I have
seen production costs suggested of $60+ per barrel, which is possible
with high oil prices (Kohler admits production costs can be as high as
$95) but such high prices break other parts of the economy which rely
on ready availability of cheap fuel.
It seems to me that this is just lazy journalism. In Kohler's case I
would bet money it was sparked by the recent Citigroup analysis (WSJ
summary: http://blogs.wsj.com/source/2012/02/17/citigroup-says-peak-oil-is-dead/
full report: https://www.citigroupgeo.com/pdf/SEUNHGJJ.pdf).
This trumpets Bakken and other shale as being able to make a
meaningful contribution to US supply. "Up to 3.5m barrels a day by
2022" is the stat they use. Small potatoes in a global market of 85m
barrels a day, with depletion rate of 3%+ p.a.

So, yes, shale oil is useful, but its emergence is a signal peak oil
is here - otherwise, why spend so much money and energy drilling for
this hard to extract oil?
My personal belief is peak oil is predominantly an economic issue in
developed countries, rather than a cliff like societal collapse, and
this signal that companies like BHP will commit $14b to oil that is so
costly to extract suggests a pretty grim economic long haul.

Best regards,
Michael Skeggs

On 29 February 2012 12:06, Jenny Goldie <jenny.goldie at optusnet.com.au> wrote:
> [I would very much welcome comments on this - please. Does it mean we can all go home or will production crash after an initial spike?Jenny )
>
> The death of peak oil
>
> by Alan Kohler
>
> http://www.businessspectator.com.au/bs.nsf/Article/peak-oil-shale-gas-fracking-energy-nuclear-budget-pd20120229-RWR7C?OpenDocument&src=sph&src=rot
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