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To: Umunhum who wrote (20450)	10/21/2004 10:11:32 PM
From: Umunhum	Respond to of 110194

The October ASPO newsletter is also out now: peakoil.net cloak and dagger excerpt: <435 The Nemesis Report Our anonymous contributor from the heart of the oil industry returns with devastating insight ASPO has undoubtedly done great work in showing the way that the so-called quota wars have led to vast exaggeration of Middle East OPEC reserves. I calculate that for Saudi Arabia, we have now reached the point where its production peak can be predicted with some confidence. It is by the end of 2004. Clearly I need to justify such a devastating prediction. On both the Aramco website and in the August issue of the IEA Monthly Report is the suggestion that Saudi Arabia needs 600-800 kb/d of additional capacity to maintain its production. Note that the word Depletion can never be used. Prior to the start-up of the Qatif and Abu Sa’fah fields in July, Saudi production had been running flat out at 9.2 million b/d. (You can believe in the legendary Saudi 1.0 - 1.5 Mb/d of spare or reserve capacity if you wish. It really doesn’t alter the argument). Saudi production is already declining by at least 600 kb/d each year, or around 50 kb/d each month. The newly started up Qatif and Abu Sa’fah fields are claimed to be adding 650 kb/d of capacity (800 kb/d in total minus the 150 kb/d that Abu Sa’fah had been producing). ] It is claimed that these two fields will reach full capacity by October. Let’s be more generous and look at end-December 2004. July’s 9.2 Mb/d capacity will have been eroded by six months of decline, roughly 300 kb/d, but augmented by the new capacity ofr some 650 kb/d. So in the last quarter of 2004 Saudi capacity will peak at 9.5-9.6 Mb/d. A year later with no new capacity added it will be down to 9 Mb/d. The next capacity increment comes in July 2006 but capacity will have already fallen to 8.7 Mb/d. The 300 kb/d of new production from Haradh Increment III will then restore capacity to 9 Mb/d. But even if decline is held at current rates, Saudi capacity will be back to 8.7 Mb/d by the end of 2006 falling to just over 8 Mb/d by the end of 2007. How can I claim that Saudi is about to go into irreversible decline when even on the ASPO reduced recoverable reserves the 50% depletion point will not have been reached? The answer is that Saudi has at various times put nineteen fields into production. Of these eight are “Stars”, being highly productive fields that produce around 90% of the country’s production. All the others are “Dogs” that have never worked well and probably never will. Recovery rates of up to 50% may be appropriate for the Stars. For the Dogs 10%, 15% or 20% would be more appropriate. Make this adjustment and Saudi has depleted more than 50% of its realistically recoverable reserves. So my conclusion remains -- Saudi’s final production peak will be in the last quarter of 2004.>

To: Umunhum who wrote (20450)	10/22/2004 7:36:54 AM
From: Square_Dealings	Respond to of 110194

thx for posting

To: Umunhum who wrote (20450)	10/22/2004 9:19:59 AM
From: russwinter	Respond to of 110194

<Anyone else out there curious as to where this additional 2.4 mbd are going to come from in the next 2 months?> It's going to come down to winter weather. The US dodged a bullet this summer, as it was cool, but it's Russian Roulette. I will put weather sites in the Lab tools for the upcoming winter. The Accuweather site isn't bad, but if anybody finds a better one? wwwa.accuweather.com

To: Umunhum who wrote (20450)	10/22/2004 10:32:18 AM
From: Wyätt Gwyön	Read Replies (2) \| Respond to of 110194

good catch, thanks.

To: Umunhum who wrote (20450)	10/22/2004 10:52:29 AM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 110194

Anyone else out there curious as to where this additional 2.4 mbd are going to come from in the next 2 months? my guess is it's not going to happen. if supply doesn't increase, demand must be destroyed. demand is destroyed by higher prices, much like we're experiencing. interesting quote from the Simmons piece: . – Just dealing with planned 4.3 million barrels of oil per day growth in 15-month plus decline of 5% requires 8+ million barrels of oil per day of new energy. – This is equivalent to a new Saudi Arabia.