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Technology Stocks : Energy Conversion Devices -- Ignore unavailable to you. Want to Upgrade?

To: Allen Bucholski who wrote (7329)	9/24/2003 12:08:30 PM
From: Krowbar	Read Replies (1) \| Respond to of 8393

Has world crude oil production peaked? In 1956 American geophysicist M. King Hubbert completed his analysis of future crude oil production in the United States. Hubbert’s work was groundbreaking because it combined geophysics with statistical analysis, projecting the trend of domestic oil production levels for years to come. Hulbert predicted that production would follow a bell curve: production would go up, but it would inevitably peak and then start to decline following a bell curve pattern. The math told Hubbert that the peak of U.S. production would occur in the early 1970s, clashing with the conventional wisdom of the time. Amazingly Hubbard was right: U.S. oil production hit its high in 1970, then started to decline just in time for the OPEC-induced oil crisis..... ...The peak of world oil production has profound economic implications. In 2002 crude oil accounted for 39% of the energy consumption in the United States. U.S. oil demand has climbed on average 1- 2% per year since the late 1980s according to a report prepared for the Bush Administration, and worldwide demand is also increasing. Natural gas accounted for 24% of U.S. energy demand, with coal accounting for 23%..... ....Examining the data and analysis several different ways, Deffeyes reaches a conclusion with far-reaching consequences for the entire industrialized world. The conclusion is this: somewhere between today and six years from now worldwide crude oil production will peak. After that, higher prices or chronic shortages will become a way of life. The 100-year reign of crude oil will be over, along with the economic growth that it nurtured.... Recent Developments "Hubbert’s Peak" was published in 2001, and Deffeyes stands by his conclusions today - except for one fact: several weeks ago he said he was wrong about world production reaching its peak midway through this decade. He now claims that it probably has already happened - in 2000. "Production in 2001 and 2002 was down from 2000, and 2003 is not off to a great start. After 2004, the rest of the world's production capability will have dropped enough so that opening all the valves in Saudi Arabia will not catch up to the year 2000." Solutions Although world oil production should peak at some time between 2000 and 2009, Deffeyes observes that none of our political leaders seem to be paying attention. Even oil companies are not buying up existing oil fields that they would if they believed the prediction. Using the latest technology has not helped increase overall production as the discovery of new oil fields has declined sharply since the 1960’s. Some geologists argue that the new technology has only shown that there isn't much oil left to be found. And most oil occurs between 5,000 and 15,000 feet underground - deeper than this and the heat generally causes the hydrocarbons to become natural gas - so drilling deeper is not a solution. Over the next decade, if crude oil becomes more expensive, natural gas will probably be the most attractive hydrocarbon to substitute for oil, at least for electricity generation and heating. It is relatively clean and by all estimates plentiful - on a worldwide basis anyway. But production of conventional sources of natural gas appears to have peaked in the U.S. in the 1990’s - but huge natural gas reserves and productive capacity exist worldwide. Liquefied natural gas can be imported into the U.S. to meet projected energy needs, but the infrastructure costs for such facilities will be measured in the billions of dollars. "In a sense, the fossil fuels are a one-time gift that lifted us up from subsistence agriculture and eventually should lead us to a future based on renewable resources," Deffeyes concludes. siliconinvestor.com