Matthew Simmons, serves on Dubya Bush's Council on Foreign Relations and is an advisor to the Bush Administration on energy issues (serving on the National Petroleum Council's Natural Gas Task Force). CEO of Simmons & Co. International, the world's largest Energy Investment Bank. Its clients include Halliburton; Baker, Botts, LLP; Dynegy; Kerr-McGee; and the World Bank.
On the Blackout:
This ought to be an incredible jolt telling us about a host of energy problems that are ultimately going to prevent any future economic growth. It's like people have been ignoring annoying phone calls and living in denial about a problem that won't go away ... the problem was inevitable. The only thing we didn't know was when it would happen.
On future Natural Gas supply:
... people need to understand the concept of peaking and irreversible decline. It's a sharper issue with gas, which doesn't follow a bell curve but tends to fall off a cliff ... All the big deposits have been found and exploited. There aren't going to be any dramatic new discoveries and the discovery trends have made this abundantly clear ... We are now in a box we should never have gotten into and it has very serious implications.
On 'the solution' to the NG crisis:
I don't think there is one. The solution is to pray. Pray for mild weather and a mild winter. Pray for no hurricanes and to stop the erosion of natural gas supplies. Under the best of circumstances, if all prayers are answered there will be no crisis for maybe two years. After that it's a certainty.
On an oil supply peak in 15 years:
Currently, oil supply issues are as serious as the electrical grid ... I have for years described two camps: the economists who told us that technology would always produce new supply and the pessimists or Cassandras who told us that peak was coming in maybe fifteen or twenty years. We may be finding out that we went over the peak in 2000. That makes both camps wrong.
On Middle East / Saudi supplies:
Over the last year, I have obtained and closely examined more than 100 very technical production reports from Saudi Arabia. What I glean from examining the data is that Saudi Arabia, already a debtor nation, has very likely gone over its Peak. If that is true, then it is a certainty that planet earth has passed its peak of production. (my emphasis - jim).
On those claiming there's no problem, i.e. Alan Greenspan:
Basically they just don't get it. Some of them have gotten lazy. They were so carried away by the arguments of the economists that they stopped doing their homework. Month by month, and year by year, events are proving them systematically and thoroughly incorrect. They just don't get it. Right now, there is a deluge of stories on the wonders of hydrogen. This is another area of great confusion. Hydrogen is not a primary source of energy.
On future economic growth:
... in the starkest possible terms, we are no longer going to be able to grow. It's like with a human being who passes a certain age in life. Getting older does not mean the same thing as death. It means progressively diminishing capacity, a rapid decline, followed by a long tail ... It is past time (for a public debate). As I have said, the experts and politicians have no Plan B to fall back on. If energy peaks ... it will be a tremendous jolt to our economic well-being and to our health - greater than anyone could ever imagine.
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