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Shared Humanity

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Re: Oil and Gas Issues
« Reply #2450 on: June 19, 2018, 06:30:05 PM »
Bill McKibben argues that the oil companies will collapse when the world acknowledges that we cannot use all the petroleum that the oil companies claim to own. 

Bill McKibben is a marvelous person who is playing a crucial role in informing the world of our fast approaching catastrophe. We need more like him. I have edited the above statement to reflect the reality of how capitalism works.

...oil companies will collapse when the world, acknowledging that we cannot use all the petroleum that the oil companies claim to own, decides to rapidly reduce the consumption of oil, driving the prices so low as to drive the oil companies into bankruptcy and forever locking the unused stores in the ground."

I will throw a big party when this happens.

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2451 on: June 19, 2018, 06:47:09 PM »
Q: Should we drive oil companies into bankruptcy and destroy the industry?
A: Yes, as quickly as possible.

Q: How do we do this?
A: Dramatically reduce our demand for oil, irrespective of how the global economy is performing.

Q: How do we reduce demand?
A: Ahhhh....now there is the rub. Aggregate demand for any product, good or service essentially reflects the sum of individual demands across the planet. To reduce demand in the aggregate, many/most of us must make decisions that reduce our personal demand for oil.

If the demand for oil persists, the oil industry will do quite nicely...thank you very much. Make no mistake. If we demand oil, the industry will supply it and make gobs of money doing it.
« Last Edit: June 19, 2018, 07:12:51 PM by Shared Humanity »

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2452 on: June 19, 2018, 06:49:30 PM »
Quote
...oil companies will collapse when the world, acknowledging that we cannot use all the petroleum that the oil companies claim to own, decides to rapidly reduce the consumption of oil, driving the prices so low as to drive the oil companies into bankruptcy and forever locking the unused stores in the ground."

I don't think he has this right.  The value of oil stock will rapidly decline once a sufficient number of stockholders realize that oil is reaching/has reached peak demand and demand collapse is coming.

Oil companies will continue to operate for some time because it will take several years to replace most ICEVs.  What we will see, and seem to already be seeing, is a decline in oil exploration and new field development.  There's probably enough production in the pipeline to cover needs.  Money invested in new oil fields is likely to be stranded.

Along the way we'll see more "Venezuelas".  The countries and companies with the highest production costs (adjusted to oil quality) will be forced out the market.

Some oil is likely to be extracted long into the future to be used as industrial feedstock.  As long as the carbon doesn't end up adding to our atmospheric carbon problem then that's not a problem.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2453 on: June 19, 2018, 06:56:53 PM »
Q: Should we drive oil companies into bankruptcy and destroy the industry?
A: Yes, as quickly as possible.

Q: How do we do this?
A: Dramatically reduce our demand for oil, irrespective of how the global economy is performing.

If the demand for oil persists, the oil industry will do quite nicely...thank you very much.

Q:  How do we dramatically reduce our demand for oil?

A:  By developing acceptable and affordable alternatives to burning oil.  That means electricity powered transportation and replacing the modest amount of oil generated electricity with renewables.

Q: Should we drive oil companies into bankruptcy and destroy the industry?

A:  We should let the oil companies die a gradual death as we bring alternatives online.  Don't fight the oil companies.  Reduce demand, work to accelerate demand decrease. 

Intentionally destroying the oil industry, with no alternatives in place, would destroy the economy.  We'd have no capital to build new wind and solar farms and to install storage.  We'd be like Greece is now.  Knowing that we should be doing more but having no money to do it.

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2454 on: June 19, 2018, 11:54:17 PM »
What we will see, and seem to already be seeing, is a decline in oil exploration and new field development.  There's probably enough production in the pipeline to cover needs.  Money invested in new oil fields is likely to be stranded.

Not only are we not seeing a decline in new field development, we are seeing dramatic increases in the development of unconventional "tight oil" fields. This is a direct response to the difficulty that conventional oil fields are having in meeting demand. These fields are being developed because they are profitable despite being more costly to extract and refine.

Meanwhile, world wide demand for oil continues to increase.

https://www.eia.gov/outlooks/steo/report/global_oil.php
« Last Edit: June 20, 2018, 12:03:23 AM by Shared Humanity »

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2455 on: June 20, 2018, 12:01:26 AM »
It would really be helpful to use data that is readily available if we want to discuss oil and gas issues.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2456 on: June 20, 2018, 12:28:13 AM »
OK, let's use data.  Here's the oil data.



Every thing on the right hand side of your graph is speculation, not data.

It's speculation on the part of the EIA which has been shown over and over to be non-predictive.  These are the guys predicting that coal will maintain market share as coal plants are being closed and new plants are not being built.

Now do some speculation of your own.  Do you know what is happening with EVs?  With battery powered trucks and buses?  If so, then you know that oil demand will almost certainly peak in the next few years and then drop.

Would your plotting of oil production going forward look anything like the EIA's?

Now, back to now.  We wouldn't be engaged in the development of unconventional "tight oil" fields unless that oil was cheaper/better value than oil coming out of places like Venezuela which can't sell their oil.  Demand is not high enough to bring that oil back online.

TerryM

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Re: Oil and Gas Issues
« Reply #2457 on: June 20, 2018, 01:19:26 AM »

Bob

13 year separations make your chart a little difficult. ::) 
I've always preferred 4 year markers so that I could easily see which American president was in power at the time. - but it's your chart.


Terry

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2458 on: June 20, 2018, 02:05:28 AM »
Google Charts are somewhat limited.  There's no way that I know to put markers at the beginning of US presidential terms and still show all the available data.

If you're thinking that US presidents have had some meaningful impact on global oil consumption then let me know which president that might have been and I'll lop off some years so there's a grid line at every four years.

Would starting at 1981 work for you?  That would give 40 years starting with Regan.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2459 on: June 20, 2018, 02:23:24 AM »
Looking at the chart I can't see anything that would be learned about a US presidential impact on global oil use. 

OPEC whacked demand in 1973-1974.

The 1979 dip was caused by the Iranian Revolution which caused a huge increase in oil prices.  Maybe the Carter administration should get some credit for emphasizing efficiency which might be the slope reset we see going forward.

The 2008-2009 drop resulted from the Great Recession.  We could give George Bush some of the blame for the severity of the recession as his administration did little to nothing to stop the economic bubble and gradually deflate it.

Past that, it's pretty much a straight line.

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2460 on: June 20, 2018, 02:27:21 AM »
We wouldn't be engaged in the development of unconventional "tight oil" fields unless that oil was cheaper/better value than oil coming out of places like Venezuela which can't sell their oil.  Demand is not high enough to bring that oil back online.

The production costs of tight oil deposits in the U.S. are now $55 per barrel, between $15 and $25 per barrel more than conventional sources of oil. It is being produced, not because it is a cheaper/better value. The new wells that are now producing 5.1 barrels per day vs. 0 barrels in 2010 have come into production because of the world's increasing demand for oil.

https://www.rystadenergy.com/newsevents/news/press-releases/us-tight-oil-production/

We are not seeing less investment in oil production. We are seeing dramatic new investment in more costly oil. Venezuela is a mess because it is being run by an incompetent Socialist government.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2461 on: June 20, 2018, 03:08:58 AM »
The oil that comes from Venezuela these days is poor quality.  The price per barrel might look good but, as I said ...

Quote
The countries and companies with the highest production costs (adjusted to oil quality) will be forced out the market.

Venezuela also has infrastructure problems that were allowed to develop during the period of low oil prices.  It would take some cash, which Venezuela doesn't have, to rebuild.  And oil companies are wary of taking their money into the country.

Global oil demand is increasing but it hasn't taken the price back high enough to bring Canadian tar back into the market.  As has been discussed before, US fracked oil is likely to set the price ceiling (except for possible short spikes) until we hit peak demand.

This also seems to be a factor in why we're seeing more US shale/"tight" oil being extracted as opposed to potentially cheaper oil from other sources.

Quote
One thing that makes shale attractive is the short pay-back time on the investments. Typically, you can recover investments after 1-2 years, while with offshore you need to wait on average ten years to recover investments completely. It just takes many years to establish the infrastructure for offshore developments compared to what we experience in tight oil.

Your link

If a wise oil investor is seeing a potential drop in demand as the world moves to electricity then it makes sense to go for tight oil and get one's investment back before demand starts to drop.  Then any sales out of the hole is profit.

Sigmetnow

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Re: Oil and Gas Issues
« Reply #2462 on: June 20, 2018, 03:51:14 AM »
How the Koch Brothers Are Killing Public Transit Projects Around the U.S.
Quote
In cities and counties across the country — including Little Rock, Ark.; Phoenix, Ariz.; southeast Michigan; central Utah; and here in Tennessee — the Koch brothers are fueling a fight against public transit, an offshoot of their longstanding national crusade for lower taxes and smaller government.
...
The Kochs’ opposition to transit spending stems from their longstanding free-market, libertarian philosophy. It also dovetails with their financial interests, which benefit from automobiles and highways.

One of the mainstay companies of Koch Industries, the Kochs’ conglomerate, is a major producer of gasoline and asphalt, and also makes seatbelts, tires and other automotive parts. Even as Americans for Prosperity opposes public investment in transit, it supports spending tax money on highways and roads. ...
https://www.nytimes.com/2018/06/19/climate/koch-brothers-public-transit.html
People who say it cannot be done should not interrupt those who are doing it.

Sigmetnow

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Re: Oil and Gas Issues
« Reply #2463 on: June 20, 2018, 04:00:05 AM »
New from Bill McKibben. :)

Despite Trump, Wall Street is breaking up with fossil fuels
Quote
At the Vatican, the Pope faced down a conference full of oil industry executives — the basic argument that fossil fuel reserves must be kept underground has apparently percolated to the top of the world’s biggest organization.

And from Wall Street came welcome word that market perceptions haven’t really changed: Even in the age of Trump, the fossil fuel industry has gone from the world’s surest bet to an increasingly challenged enterprise. Researchers at the Institute for Energy Economics and Financial Analysis minced no words: “In the past several years, oil industry financial statements have revealed significant signs of strain: Profits have dropped, cash flow is down, balance sheets are deteriorating and capital spending is falling. The stock market has recognized the sector’s overall weakness, punishing oil and gas shares over the past five years even as the market as a whole has soared.”

The IEEFA report labeled the industry “weaker than it has been in decades” and laid out its basic frailties, the first of which is paradoxical. Fracking has produced a sudden surge of gas and oil into the market, lowering prices — which means many older investments (Canada’s tar sands, for instance) no longer make economic sense. Fossil fuel has been transformed into a pure commodity business, and since the margins on fracking are narrow at best, its financial performance has been woeful. The IEEFA describes investors as “shell-shocked” by poor returns.

The second weakness is more obvious: the sudden rise of a competitor that seems able to deliver the same product — energy — with cheaper, cleaner, better technologies. Tesla, sure—but Volkswagen, having come clean about the dirtiness of diesel, is going to spend $84 billion on electric drivetrains. China seems bent on converting its entire bus fleet to electric power. Every week seems to bring a new record-low price for clean energy: the most recent being a Nevada solar plant clocking in at 2.3 cents per kilowatt hour, even with Trump’s tariffs on Chinese panels.

And the third problem for the fossil fuel industry? According to IEEFA, that would be the climate movement — a material financial risk to oil and gas companies. “In addition to traditional lobbying and direct-action campaigns, climate activists have joined with an increasingly diverse set of allies — particularly the indigenous-rights movement — to put financial pressure on oil and gas companies through divestment campaigns, corporate accountability efforts, and targeting of banks and financial institutions. These campaigns threaten not only to undercut financing for particular projects, but also to raise financing costs for oil and gas companies across the board.”
https://grist.org/article/despite-trump-wall-street-is-breaking-up-with-fossil-fuels/
People who say it cannot be done should not interrupt those who are doing it.

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2464 on: June 20, 2018, 05:32:00 AM »
Global oil demand is increasing but it hasn't taken the price back high enough to bring Canadian tar back into the market. 

Tar sands is a filthy business and the costs to produce oil are quite high but the break even point for tar sands is dropping as producers reduce costs with a break even point approaching $60 per barrel.

https://www.bloomberg.com/news/articles/2017-08-24/can-oil-sands-pay-off-at-just-50-a-barrel

And tar sand production continues to increase.

https://www.eia.gov/todayinenergy/detail.php?id=25112

As has been discussed before, US fracked oil is likely to set the price ceiling (except for possible short spikes) until we hit peak demand.

I have no idea what you are trying to say here. How does US fracked oil set a price ceiling? The ceiling for the price of any product has nothing to do with the cost of producing the product. It has to do with the relationship between supply and demand.

It costs $55 to produce a barrel of fracked oil in the U.S. This is the cost whether the market price for a barrel is $103 like it was in 2014 or $30 like it was in early 2016. Now that the price for a barrel of oil has risen to $70, the cost to produce a barrel of fracked oil is still $55.


You are now making my brain hurt.
« Last Edit: June 20, 2018, 05:45:11 AM by Shared Humanity »

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2465 on: June 20, 2018, 05:45:38 AM »
Quote
I have no idea what you are trying to say here. How does US fracked oil set a price ceiling? The ceiling for the price of any product has nothing to do with the cost of producing the product. It has to do with the relationship between supply and demand.

What I am saying is that US 'tight' oil can be brought online fairly rapidly and there is ample supply to cover increasing demand for a number of years.  As the price of oil hits profitability for shale oil then rigs will move into the field and start work.

Demand drives up prices until supply meets demand.  There seems to be no need to go after any oil that would be more expensive than US shale oil.

Some tar sands oil will come to market from sites already in operation.  It's unlikely there will be further money spent to bring new tar sands online.

gerontocrat

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Re: Oil and Gas Issues
« Reply #2466 on: June 20, 2018, 12:31:21 PM »

Demand drives up prices until supply meets demand.  There seems to be no need to go after any oil that would be more expensive than US shale oil.

Some tar sands oil will come to market from sites already in operation.  It's unlikely there will be further money spent to bring new tar sands online.

"It's unlikely there will be further money spent to bring new tar sands online."

Data is such a nuisance.

http://aptnnews.ca/2018/06/14/alberta-tarsands-project-wins-regulator-approval-despite-metis-objections/
Quote
The Canadian Press
CALGARY – A northern Alberta tarsands project has been approved by the Alberta Energy Regulator over the objections of local Indigenous people who say it will encroach on sacred lands and poses a risk to their drinking water.

The 10,000-barrel-per-day steam-driven Rigel tarsands project proposed by privately held Prosper Petroleum Ltd. of Calgary is in the public interest, the AER said in a decision posted on its website.

Construction is expected to cost $390 million, with an additional $50 million to be spent on drilling and completing wells before startup.

“Our plan is to start construction in Q4 of this year and we believe we can have it built and in operation in 2020,” said Prosper CEO Brad Gardiner.

The project is being built with the support of partner Petrolama Namur Oil Sands Energy, a subsidiary of Czech Republic-based Lama Energy Group, as its first investment in the tarsands, he said.

http://www.jwnenergy.com/article/2018/6/six-major-new-canadian-oil-and-gas-projects-approved-january/
5 new major Canadian oil and gas projects underway since January

Quote
Investment in Canada’s oil and gas sector is down considerably, but every few months a handful of new major projects are announced.

New projects approved recently include incremental oilsands production increases and pipelines and facilities to support growth in liquids-rich natural gas development.

Here’s a look at five new projects that have been announced since January 2018. This is in addition to our list of new projects underway from December 2017.

1. Osum SAGD expansion

Privately held junior Osum Oil Sands Corp. announced in January it would proceed with work at the Orion SAGD project to increase production capacity, planning to double its volumes by the end of 2019.

2. Pembina’s $120 million Empress gas plant expansion

The new facilities, which are expected to be in service in 2020, will add approximately 30,000 bbls/d of propane-plus fractionation capacity to the company’s Empress East NGL system.

3. Pembina’s $280 million new Montney/Deep Basin pipeline expansion

Pembina Pipeline announced in May that will build a new expansion of its Peace pipeline system to accommodate growth in the Montney and Deep Basin resource plays.

4. MEG Energy’s $275 million oilsands expansion

In May, MEG Energy disclosed that work is underway on a new expansion of its Christina Lake in situ oilsands project in northern Alberta. The company is using cash injected from the February sale of its interest in the Access Pipeline and Stonefell Terminal to fund the 13,000 bbl/d project, known as the Phase 2B Brownfield Expansion.

5. Keyera’s $150 million new Montney gas plant

Keyera Corp. said in May that it is proceeding with phase two of its Wapiti Gas Plant near Grande Prairie, Alta., in the liquids-rich Montney play. The project, which has an estimated cost of approximately $150 million, will add 150 million cubic feet per day of sour gas processing to the plant, which is currently under construction.
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oren

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Re: Oil and Gas Issues
« Reply #2467 on: June 20, 2018, 02:36:08 PM »
Q: Should we drive oil companies into bankruptcy and destroy the industry?
A: Yes, as quickly as possible.

Q: How do we do this?
A: Dramatically reduce our demand for oil, irrespective of how the global economy is performing.

Q: How do we reduce demand?
A: Ahhhh....now there is the rub. Aggregate demand for any product, good or service essentially reflects the sum of individual demands across the planet. To reduce demand in the aggregate, many/most of us must make decisions that reduce our personal demand for oil.

If the demand for oil persists, the oil industry will do quite nicely...thank you very much. Make no mistake. If we demand oil, the industry will supply it and make gobs of money doing it.
Well said, but there is an extra challenge here. As demand is reduced, the price will drop rapidly. So many/most of us must make decisions that reduce our personal demand for oil even while its price is dropping sharply (making it cheaper for many people who currently don't use as much as they might want to). So the alternatives (EVs) must be very attractive and/or far cheaper to own in order for that to happen.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2468 on: June 20, 2018, 03:28:40 PM »
Tesla has claimed that they will hit manufacturing cost parity with ICEVs this year and drop significantly below by 2020.  Most of that involves reducing battery costs.

Other manufacturers will be able to manufacture EVs at a lower cost than ICEVs once independent battery companies ramp up to create economy of scale.

By 2025 we should find it cheaper to purchase an EV than a similar-feature ICEV.  EVs are already cheaper to operate and most people find them more satisfying to drive. 

By 2030 we should expect the majority of new car and light truck sales to be battery powered.  City buses and trucks are likely to switch to battery power even faster because operating savings will be more important to companies and government organizations.

I doubt that EVs have to be "far cheaper".  Just some cheaper should be enough.  The majority of people are concerned about climate change.  If people can help fight climate change and save money then for many people only a small annual savings should be sufficient.




Shared Humanity

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Re: Oil and Gas Issues
« Reply #2469 on: June 20, 2018, 04:41:17 PM »
Data is such a nuisance.

Don't worry. Bob will find a way to make it disappear in his next post.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2470 on: June 20, 2018, 05:04:27 PM »
Data is such a nuisance.

Don't worry. Bob will find a way to make it disappear in his next post.

What is that supposed to mean?

I'm probably the most data driven person who posts here. 

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2471 on: June 20, 2018, 05:14:34 PM »
It's speculation on the part of the EIA which has been shown over and over to be non-predictive. 

Now do some speculation of your own.  Do you know what is happening with EVs?  With battery powered trucks and buses?  If so, then you know that oil demand will almost certainly peak in the next few years and then drop.

Would your plotting of oil production going forward look anything like the EIA's?

How about I don't speculate about the future demand for oil but use some hard data and assess the likelihood that "oil demand will almost certainly peak in the next few years and then drop."

In 2015, there were 1.25 billion vehicles on the road worldwide of which 1 billion are cars.

https://www.statista.com/statistics/281134/number-of-vehicles-in-use-worldwide/

The number of cars is expected to double to 2 billion by 2040.

https://www.weforum.org/agenda/2016/04/the-number-of-cars-worldwide-is-set-to-double-by-2040

So will EV's cause oil demand to peak in a few years and decline from that point forward?

Total worldwide EV sales in the 1st quarter of 2018 was 130,000 so it is unlikely that sales will exceed 1 million cars for the year.

https://www.statista.com/statistics/666130/global-sales-of-electric-vehicles-ytd-by-brand/

The number of vehicles projected to be sold in 2018 is 81.5 million so we can expect at least 80 million new ICE vehicles to hit the road this year.

https://www.statista.com/statistics/200002/international-car-sales-since-1990/

So could you explain to me again how demand for oil will almost certainly peak in a few years?

(Bob - I don't know why you are so hesitant to consider the actual data or so readily willing to dismiss it. Perhaps the reality of the situation worries you. It certainly scares the shit out of me! Perhaps you are simply trying to obscure the truth so as to deflect any real concerns that all of us should have. Whatever, it simply doesn't matter your motivation. The simple fact is that petroleum demand will continue to rise for the foreseeable future and this should frighten all of us, helping us to realize that slow, steady, pragmatic progress is simply not enough.)

« Last Edit: June 20, 2018, 05:31:43 PM by Shared Humanity »

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2472 on: June 20, 2018, 05:21:39 PM »
Quote
According to a Wall Street Journal breakdown of production costs per barrel for 13 large producers, Saudi Arabia can extract a barrel of crude at US$8.98, just a little bit less than Iran, at US$9.08. To compare, the cost per barrel of U.S. shale comes in at US$23.35.

This cost includes taxes, pure production costs, administrative costs, and capital expenditure

https://oilprice.com/Energy/Energy-General/Saudi-vs-Shale-The-Breakeven-Myth.html

Quote
In their 11th annual review of oil sands supply costs, the Canadian Energy Research Institute (CERI) pegs breakeven costs at $43.31/bbl for SAGD projects (steam-assisted gravity drainage) and $70.08/bbl for a stand-alone mine. The figures exclude blending and transportation costs but include capital expenditures.

Factoring in blending and transportation, WTI equivalent costs increase to US$60.52 for SAGD and US$75.73 for a stand-alone mine.

http://www.oilsandsmagazine.com/news/2017/2/9/oil-sands-breakeven-prices-decline-since-2015

Quote
In fact, the bad news for Alberta’s oilpatch has been building for a decade. That’s when shipbuilders in South Korea, China and Japan began constructing what has become a global fleet of about 750 VLCCs (with 50 more ordered for 2018), and the scrapping of Aframax class tankers began accelerating. This in turn drove down the benchmark price for ocean oil shipping, triggered the LOOP terminal upgrade, effectively consigned oil terminals like those in Burnaby, B.C. to minor league status, and left oil deposits far from deep port tidewater at a significant cost disadvantage.

When the undeniably dirty content of Alberta’s bitumen deposits is added into these negative cost equations, global oil players know when to cut and run. Compared to conventional heavy crude, bitumen contains 102 times more copper, 21 times more vanadium, 11 times more sulphur, 11 times more nickel, six times more nitrogen, and five times more lead, according to the U.S. Geological Survey. It also has a much lower ratio of hydrogen to carbon, which degrades combustion efficiency.

This helps explain why, in the recent past, oil giants such as Exxon-Mobil, Conoco-Phillips, Royal Dutch Shell, Total S.A., and Norwegian oil company Statoil have abandoned gargantuan bitumen deposits in western Canada and/or taken billion-dollar write-downs, to the howls of shareholders.

http://theenergymix.com/2018/03/04/exclusive-out-of-the-loop-the-fatal-flaw-of-albertas-oil-export-expansion/

There may be some activity in Canadian tar sands oil but it certainly looks like economics are working against its future.

gerontocrat

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Re: Oil and Gas Issues
« Reply #2473 on: June 20, 2018, 05:29:12 PM »
Data is such a nuisance.

Don't worry. Bob will find a way to make it disappear in his next post.

What is that supposed to mean?

I'm probably the most data driven person who posts here.

I replied to a post where you said that "It's unlikely there will be further money spent to bring new tar sands online." There is data to show that investments, though less, in that muck have not stopped.

https://forum.arctic-sea-ice.net/index.php/topic,861.msg159757.html#msg159757

It is true that many of the big players are exiting and flogging off their assets to bit players. That is a worry as who will clean up the mess they leave behind after they've gone bust ?

But continued development of the tar sands industry has the full backing of the Canadian Government under Trudeau. Subsidies to fossil fuels in Canada are somewhat large.

https://www.iisd.org/faq/unpacking-canadas-fossil-fuel-subsidies/

HOW MUCH DOES CANADA GIVE OUT IN FOSSIL FUEL SUBSIDIES?
Quote
About $3.3 billion for oil and gas producers (currency in Canadian dollars).

That includes measures like reduced property taxes and special tax deductions for the industry, as well as direct infusions of cash from the government to companies. You can find a list of key subsidies below.

Both the federal and provincial governments are providing these subsidies. Examples of federal programs include the Canadian Development Expense, the Canadian Exploration Expense, and the Atlantic Investment Tax Credit, with a yearly average value of $1 billion, $148 million and $127 million, over 2013 to 2015. Examples of provincial programs include Crown Royalty Reductions in Alberta with an average value of $1.16 billion and the Deep Drilling Credit in British Columbia valued at $271 million, over the same years.

I could not resist the comment. Optimism is great - up to the point it becomes foolish.
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Shared Humanity

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Re: Oil and Gas Issues
« Reply #2474 on: June 20, 2018, 05:36:43 PM »
There may be some activity in Canadian tar sands oil but it certainly looks like economics are working against its future.

Tar sand oil is certainly a fools play and anyone investing heavily is going to lose their shirt. Good for them. Never the less, existing fields will continue to produce and expand as it costs a fortune to shut them down. As the price of oil rises and dips, these fields will experience periods of substantial profits.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2475 on: June 20, 2018, 05:39:22 PM »
It's speculation on the part of the EIA which has been shown over and over to be non-predictive. 

Now do some speculation of your own.  Do you know what is happening with EVs?  With battery powered trucks and buses?  If so, then you know that oil demand will almost certainly peak in the next few years and then drop.

Would your plotting of oil production going forward look anything like the EIA's?

How about I don't speculate about the future demand for oil but use some hard data and analyze the likelihood that "oil demand will almost certainly peak in the next few years and then drop."

In 2015, there were 1.25 billion vehicles on the road worldwide of which 1 billion are cars.

https://www.statista.com/statistics/281134/number-of-vehicles-in-use-worldwide/

The number of cars is expected to double to 2 billion by 2040.

https://www.weforum.org/agenda/2016/04/the-number-of-cars-worldwide-is-set-to-double-by-2040

So will EV's cause oil demand to peak in a few years and decline from that point forward?

Total worldwide EV sales in the 1st quarter of 2018 was 130,000 so it is unlikely that sales will exceed 1 million cars for the year.

https://www.statista.com/statistics/666130/global-sales-of-electric-vehicles-ytd-by-brand/

The number of vehicles projected to be sold in 2018 is 81.5 million so we can expect at least 80 million new ICE vehicles to hit the road this year.

https://www.statista.com/statistics/200002/international-car-sales-since-1990/

So could you explain to me again how demand for oil will almost certainly peak in a few years?

Bob.

I don't know why you are so hesitant to consider the actual data or so readily willing to dismiss it. Perhaps the reality of the situation worries you. It certainly scares the shit out of me! Perhaps you are simply trying to obscure the truth so as to deflect any real concerns that all of us should have. Whatever, it simply doesn't matter your motivation. The simple fact is that petroleum demand will continue to rise for the foreseeable future and this should frighten all of us and make us realize that slow, steady, pragmatic progress is simply not enough.


Do you really think that people will continue to purchase ICEVs over EVs once EVs are cheaper to purchase?  EVs are already cheaper to operate.  If you can't make a logical argument as to why ICEV sales will dominate the market once EVs are cheaper to purchase then how do you support a continued rise in oil use?

You are making a prediction based on past behavior.  People bought ICEVs.  But people bought those ICEVs in an environment in which EVs were either not available or were too expensive.

The reason France replaced oil-generation with nuclear was because wind and solar were too expensive at that time.  (Plus France did not have affordable coal.)

France would not make the same decision today.  People will almost certainly purchase a less expensive alternative to the ICEV.

Do you not realize how rapidly technology transitions tend to happen?  US cars have an average lifespan of 13 years.  Half the fleet is replaced in 13 years and those are the cars that drive the most.  Buses are already switching to battery power.  Companies are purchasing battery powered trucks in large numbers. 

You may think my timeline too aggressive.  That's fine.  I don't have any way to accurately see the future.  But we are almost certain to hit peak oil well before 2030 and the decline from there should be swift.

Quote
make us realize that slow, steady, pragmatic progress is simply not enough.

What is "enough"?  We're already suffering from climate change.  It would be wonderful if we could stop GHG emissions this afternoon. 

Do you have a workable solution to stop the planet from emitting GHG in one big, immediate step?  If you've got a better solution let's hear it.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2476 on: June 20, 2018, 05:48:08 PM »
There may be some activity in Canadian tar sands oil but it certainly looks like economics are working against its future.

Tar sand oil is certainly a fools play and anyone investing heavily is going to lose their shirt. Good for them. Never the less, existing fields will continue to produce and expand as it costs a fortune to shut them down. As the price of oil rises and dips, these fields will experience periods of substantial profits.

There's a limited supply of fools. 

Operating tar sands fields that have transportation in place will likely continue to operate for some period of time. 

Here's what the Canadian Energy Research Institute said in Feb 2017 when oil was about $50/barrel.

Quote
CERI therefore concludes that no greenfield oil sands project is economically feasible under the current pricing environment.

http://www.oilsandsmagazine.com/news/2017/2/9/oil-sands-breakeven-prices-decline-since-2015

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2477 on: June 20, 2018, 05:59:43 PM »
Quote
I could not resist the comment. Optimism is great - up to the point it becomes foolish.

I resisted posting what I think you should do to yourself.

I don't think my optimism foolish.  I know that we are moving too slowly.  We should have started earlier and moved faster.  We're now getting hurt by climate change and it will get worse.

I do see a way to avoid extreme climate change and I think we'll achieve that.  I think so because a low carbon future will be cheaper than a high carbon future.

What used to scare the shit out of me is realizing what climate change could mean and seeing only people talking about how everyone needs to drastically change their lifestyle.  I knew that was not going to happen.  The vast majority of humanity will not give up stuff unless forced to.

Wagging fingers and shouting does not bring about serious change.  Rational appeals do not bring about massive change.

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2478 on: June 20, 2018, 07:14:51 PM »
It's speculation on the part of the EIA which has been shown over and over to be non-predictive. 

Now do some speculation of your own.  Do you know what is happening with EVs?  With battery powered trucks and buses?  If so, then you know that oil demand will almost certainly peak in the next few years and then drop.

Would your plotting of oil production going forward look anything like the EIA's?

How about I don't speculate about the future demand for oil but use some hard data and analyze the likelihood that "oil demand will almost certainly peak in the next few years and then drop."

In 2015, there were 1.25 billion vehicles on the road worldwide of which 1 billion are cars.

https://www.statista.com/statistics/281134/number-of-vehicles-in-use-worldwide/

The number of cars is expected to double to 2 billion by 2040.

https://www.weforum.org/agenda/2016/04/the-number-of-cars-worldwide-is-set-to-double-by-2040

So will EV's cause oil demand to peak in a few years and decline from that point forward?

Total worldwide EV sales in the 1st quarter of 2018 was 130,000 so it is unlikely that sales will exceed 1 million cars for the year.

https://www.statista.com/statistics/666130/global-sales-of-electric-vehicles-ytd-by-brand/

The number of vehicles projected to be sold in 2018 is 81.5 million so we can expect at least 80 million new ICE vehicles to hit the road this year.

https://www.statista.com/statistics/200002/international-car-sales-since-1990/

So could you explain to me again how demand for oil will almost certainly peak in a few years?

Bob.

I don't know why you are so hesitant to consider the actual data or so readily willing to dismiss it. Perhaps the reality of the situation worries you. It certainly scares the shit out of me! Perhaps you are simply trying to obscure the truth so as to deflect any real concerns that all of us should have. Whatever, it simply doesn't matter your motivation. The simple fact is that petroleum demand will continue to rise for the foreseeable future and this should frighten all of us and make us realize that slow, steady, pragmatic progress is simply not enough.


Do you really think that people will continue to purchase ICEVs over EVs once EVs are cheaper to purchase?  EVs are already cheaper to operate.  If you can't make a logical argument as to why ICEV sales will dominate the market once EVs are cheaper to purchase then how do you support a continued rise in oil use?

You are making a prediction based on past behavior.  People bought ICEVs.  But people bought those ICEVs in an environment in which EVs were either not available or were too expensive.

The numbers above speak for themselves. How long do you estimate for the production of EV's to increase from the current 500,000 per year to the 80 million per year needed to satisfy the annual demand for vehicles?

The simple fact is that EV's will not be available in the quantities required to meet demand if everyone on the planet decided today that they wanted to buy one. My guess it will take close to 2 decades. Let's say it will take only one decade to ramp up from 500,000 to the 80 million needed per year. (I doubt such a ramp up is possible but lets pretend anyway as an intellectual exercise.)In that time we will see the total number of ICE's climb from 1 billion to 1.4 billion and the production of petroleum will climb to satisfy the increased demand. It will take another 5 years before ICE's drop back to the current number and the demand for petroleum to begin a decline from current levels.
« Last Edit: June 20, 2018, 08:00:16 PM by Shared Humanity »

numerobis

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Re: Oil and Gas Issues
« Reply #2479 on: June 20, 2018, 07:19:10 PM »
The oil price is at break-even for tar sands today. The government has also committed to building that pipeline; with billions of federal government subsidies pouring in, there’s several hundred thousand barrels a day that can ship cheaply.

The tar sands have been expanding as well from their current mines. A *new* mine is expensive, but expanding an existing mine is far cheaper.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2480 on: June 20, 2018, 07:38:29 PM »
Quote
How long do you estimate for the production of EV's to increase from the current 500,000 per year to the 80 million per year needed to satisfy the annual demand for vehicles?

Let's break it down into what is possible and what is likely.

Possible:

We could transition from almost all ICEVs to almost all EVs in about five years.  That would take, mostly, a massive build out of battery factories.  We'd need to build about 100 globally but that's doable if we made it a priority.  Car companies could develop and tool up for all EVs in that amount of time. 

Look how quickly Tesla developed and tooled for their Model S and they'd never built a car previously.  They didn't even have a car factory.  Tesla started selling their Lotus EV conversion in 2008 and started selling a car they built from the ground up in 2012.

Likely:

I can give you stages and the amount of time I think it might take to reach each. 

Stage 1.  Manufacturing cost parity.  A period from 2018 to no more than 2025. 

Build enough battery factories to bring down battery prices like Tesla has done.  BYD is going big as are some other Chinese companies.  LG Chem has had a build up program going for some time.  Panasonic is starting work on a gigafactory that will sell to non-Tesla companies.  Other companies are making their moves.

Tesla has said that they reach manufacturing price parity this year (2018).

Stage 2.  Bring purchase prices to parity and below.  Educate drivers about EVs.

I suspect this will happen before 2030, certainly not far after.  After this I expect demand for EVs will soar and cause a rapid drop in ICEV sales.

Stage 3: Most new car sales will be EVs.  ICEV infrastructure will collapse in much of the world.

Somewhere around 2030 EVs should dominate the market.  Economics, concern over climate change, and the convenience of EVs should quickly flip the market. 

After EVs have dominated for a few years it will be harder to find repair shops, parts, and fuel for ICEVs.  Not impossibly hard, but far less easy than today.  Used car buyers will seek out EVs in order to save on fuel costs and avoid engine/transmission repairs.

I expect a switch from imported used ICEVs to inexpensive, lower range EVs fairly rapidly in less developed countries.

I won't be surprised to see the ICEV pretty much extinct by 2040.

Stage X:  Tony Seba turns out to have gotten it right.  Self-driving robotaxis pan out and the number of cars on the road drops by 90%.

GM seems to think that they are really close to robotaxi service in cities (well mapped locations).  If they are right then we could start seeing serious abandonment of oil by 2025.  Certainly by 2030.




Bob Wallace

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Re: Oil and Gas Issues
« Reply #2481 on: June 20, 2018, 07:42:10 PM »
The oil price is at break-even for tar sands today. The government has also committed to building that pipeline; with billions of federal government subsidies pouring in, there’s several hundred thousand barrels a day that can ship cheaply.

The tar sands have been expanding as well from their current mines. A *new* mine is expensive, but expanding an existing mine is far cheaper.

Shale oil can be brought to market rapidly and it costs less to develop and extract.  As more US rigs move in to extract shale oil we should see oil prices drop below the profitable level for shale.

A large price drop may not occur because the Middle East is desperate for higher prices.  The lower cost producers may manage supply to keep prices higher than would happen in a competitive market.

Alexander555

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Re: Oil and Gas Issues
« Reply #2482 on: June 20, 2018, 08:10:54 PM »
The oil price is at break-even for tar sands today. The government has also committed to building that pipeline; with billions of federal government subsidies pouring in, there’s several hundred thousand barrels a day that can ship cheaply.

The tar sands have been expanding as well from their current mines. A *new* mine is expensive, but expanding an existing mine is far cheaper.

Don't forget that Canadian tar sand oil is selling 20 $ below the price of the West Texas crude. So i don't think it's profitable.

Sigmetnow

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Re: Oil and Gas Issues
« Reply #2483 on: June 20, 2018, 08:49:19 PM »
Climate Czar Tells OPEC to Pivot From Oil or Prepare to Suffer
Quote
The world’s biggest crude exporters need to support the transition away from oil or prepare for growing climate-induced destabilization that could wreck their markets, the United Nation’s top environment official said.

“If we do not pay attention to this transition, their business is also going to suffer,” Patricia Espinosa said in an interview with Bloomberg News at a seminar ahead of an Organization for Petroleum Exporting Countries meeting in Vienna. “The conversation here is a lot about business and price. Very few people talk about sustainability.”

Scientists predict floods, famines and superstorms will become more frequent unless the world keeps temperature rises well below 2 degrees Celsius (3.6 degrees Fahrenheit) this century. The risks posed by runaway climate change have mobilized trillions of dollars of investments by companies and economies transitioning to renewable energy, electric transport and more efficient technologies. Oil majors including Total SA and Royal Dutch Shell Plc have increasingly shown interest in diversifying investments away from fossil fuels and toward greener energy.

“This is about the survival of their business and what are they going to do,” said Espinosa, the Mexican diplomat who opened talks with OPEC when she became executive secretary of the UN’s Framework Convention on Climate Change in 2013. “They need markets and resiliency and that requires attention to climate change.”

Espinosa said OPEC ministers and oil executives had mixed reactions to her speech. She’s encouraging oil producers to begin reinvesting their vast profits in renewable technologies as a hedge against climate risks.

“They need economies that are thriving and countries that are growing for business to work,” Espinosa said. “That will not happen if we do not pay attention to climate change. We will have global destabilization, crisis everywhere.”
https://www.bloomberg.com/news/articles/2018-06-20/opec-told-by-climate-czar-to-pivot-from-oil-or-prepare-to-suffer


At least they didn’t boo her off the stage....
People who say it cannot be done should not interrupt those who are doing it.

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2484 on: June 20, 2018, 08:57:50 PM »
Quote
How long do you estimate for the production of EV's to increase from the current 500,000 per year to the 80 million per year needed to satisfy the annual demand for vehicles?

We could transition from almost all ICEVs to almost all EVs in about five years.  That would take, mostly, a massive build out of battery factories.  Car companies could develop and tool up for all EVs in that amount of time.

We could but it takes 2 years to design and bring to market a new car. It will take longer if every new car is an EV. For the new car market to be almost all EV's in 5 years, every single auto manufacturer in the world would have to decide today that they are exiting the market for ICE vehicles. This is an entirely different decision than deciding to enter into the EV market. Try convincing Billy Joe Bob to give up his love for his V8 Pickup. Light trucks account for 20% of vehicle sales in the U.S. And try convincing U.S. car companies to quit building them even though they are the most profitable vehicle in their line up.

Stage 1.  Manufacturing cost parity.  A period from 2018 to no more than 2025. 

Let's assume that price parity has already been achieved.

Stage 2.  Educate drivers about EVs.

I suspect this will happen before 2030, certainly not far after.  After this I expect demand for EVs will soar and cause a rapid drop in ICEV sales.

While EV sales would climb rapidly, good luck getting Billy Joe Bob or anyone else to buy a car they don't want.

Stage 3: ICEV infrastructure will collapse in much of the world.

With 1.2 billion ICE vehicles on the road, I'm thinking those gas stations will hang around for a while. It is about a rational functioning market. Where there is a demand, there will be companies willing to supply.
 
After EVs have dominated for a few years it will be harder to find repair shops, parts, and fuel for ICEVs.  Not impossibly hard, but far less easy than today. 

I own an 11 year old Scion xA which gets 36 MPG. Just around the corner from my apartment, Garcia's auto service can cheaply and quickly repair my car. With 1.2 billion ICE vehicles on the road, I'm thinking Mr. Garcia is going to be happy to service these vehicles and the aftermarket parts industry will be happy to make the parts required to service such a large market.
« Last Edit: June 20, 2018, 09:05:07 PM by Shared Humanity »

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2485 on: June 20, 2018, 09:21:51 PM »
Don't get me wrong. It is essential that we quickly transition to EV's, the quicker the better, but an efficient functioning market will continue to profitably supply the items needed to support the 1.2 billion ICE vehicles on the road. They will supply these items because there is money to be made doing so.
.
Could we convert the entire new car market to EV's in 5 years? Yes. Will we? No.

If we were to do this, the number of ICE vehicles on the road will climb by another 200 million to 1.5 billion. At this point, we will see the number of vehicles decline as ICE vehicles are taken off the road and new EV's replace them. Three years after the peak, ICE vehicle numbers will have declined to the number that currently exist today. In 2026, we would finally start seeing a decline in the demand for liquid fuels to power our vehicles and this decline will continue for about 15 years. In 2040 all of the 1.2 billion ICE vehicles will be off the road. This would be a fantastic outcome and, quite honestly, is a necessary one.

The big fly in the ointment? No one can insist on buying an ICE vehicle after 2023. The manufacture of gas powered vehicles will cease and since millions of people will still want to buy one, governments will have to make it illegal to manufacture or buy one. This will have the perverse effect of strengthening the used car market for gas powered vehicles, increasing the profitability of this market.

Shared Humanity

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Re: Oil and Gas Issues
« Reply #2486 on: June 20, 2018, 09:36:01 PM »
So how do we get all ICE vehicles off of the road by 2040?

Simple, we make it illegal to manufacture ICE vehicles after 2023. Alternatively, we tax every new ICE vehicle to make them prohibitively expensive so that only 1%ers will buy them.

Sigmetnow

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Re: Oil and Gas Issues
« Reply #2487 on: June 20, 2018, 10:08:10 PM »
More on “the switch to EVs” posted recently in the Cars thread:
https://forum.arctic-sea-ice.net/index.php/topic,438.msg159831.html#msg159831
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Bob Wallace

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Re: Oil and Gas Issues
« Reply #2488 on: June 20, 2018, 11:40:30 PM »
Quote
We could but it takes 2 years to design and bring to market a new car. It will take longer if every new car is an EV. For the new car market to be almost all EV's in 5 years, every single auto manufacturer in the world would have to decide today that they are exiting the market for ICE vehicles. This is an entirely different decision than deciding to enter into the EV market. Try convincing Billy Joe Bob to give up his love for his V8 Pickup.

What did I say?  Oh, yes, possible.  "We could transition from almost all ICEVs to almost all EVs in about five years.  That would take, mostly, a massive build out of battery factories.  Car companies could develop and tool up for all EVs in that amount of time."

That, I will hold, is physically possible.  Decide today and be cranking out nothing but EVs five years from today.

Some people will move quickly to EVs.  Look at the roughly half million that have put down a deposit on the new Tesla.  Others will take longer, we saw that with other technology shifts like film to digital.  A few early adopters.  Then a mass movement.  And a few stragglers.

A few ICEV stragglers won't matter.  Billy Bob Joe will get tired of getting left behind when the light changes.  And he'll want the torque to snatch his bass boat off the ramp.  He's already trolling with an electric motor, he's up with charging and quiet power.

At some point the gas pump that Billy Bob Joe uses when he goes after his fall buck will quit working and the little country grocery won't find it worth the money to install a new one.  Billy Bob Joe will get tired of hauling extra gas from town when he goes to the woods.

At some point Garcia won't be getting enough business to cover his overhead.  See many TV and stereo repair shops these days?  Got a neighborhood harness maker or wheelwright?

When the last repair shops are only found in larger towns people in the smaller towns and countryside will give up on ICEVs.  It's going to be a shrinking market and at some point things will simply collapse.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2489 on: June 20, 2018, 11:49:35 PM »
Quote
The big fly in the ointment? No one can insist on buying an ICE vehicle after 2023. The manufacture of gas powered vehicles will cease and since millions of people will still want to buy one, governments will have to make it illegal to manufacture or buy one. This will have the perverse effect of strengthening the used car market for gas powered vehicles, increasing the profitability of this market

It won't be necessary for governments to ban ICEV manufacturing.  It will happen on its own.

In photography we saw a very rapid movement to digital by "casual" shooters.  The ability to instantly see and send photos moved those people off film.  Over a short period the number of new inexpensive film cameras fell to about zero. 

Some serious photographers held on longer because film held some advantages for awhile.  But at some point the majors like Canon and Nikon quit spending money on new film cameras.  They stopped development and cut their offerings back to a single model.  And later on they warehoused enough new fSLRs to cover demand for a number of years and shut down their film camera factories.

ICEV demand will drop to the point at which it won't make sense for large companies to continue to develop and manufacture ICEVs.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2490 on: June 21, 2018, 06:30:31 AM »
The US military is developing hybrid patrol vehicles for remote stations.  The most risky job in the military is hauling fuel.  A solar/battery system can be flown in by helicopter and used to charge vehicles that have large enough battery packs to do their normal daily work.  Then, if more range is needed, the ICE can give the needed extra range.

As for digital cameras, you need to get out more.  A huge percentage of the world's population now has one in their phone.

Are you unaware of the large battery powered trucks that Tesla and other companies are about to produce?  I'll be glad to fill you in.  But, first, it would be nice if you got that burr out of your butt.


oren

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Re: Oil and Gas Issues
« Reply #2491 on: June 21, 2018, 07:31:13 AM »
So based on the discussions here between SH and BW it seems we have agreement at last:
* It will take at least 2 decades/until around 2040 to switch to EVs and reduce oil consumption significantly.
* It could physically happen in ~5 years, but will not.
* The transition is a good thing but too slow.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2492 on: June 21, 2018, 08:48:00 AM »
Quote
Has global energy demand been increasing and projected to keep increasing? Yes

Has global fossil fuel energy demand been increasing and projected to keep increasing? Yes

Global oil consumption has been increasing.  It will almost certainly peak and then we will probably see demand decay by 2030.

Global coal consumption peaked in 2013 and dropped 3.5% by 2017.

Global natural gas consumption has been increasing.

Global primary energy consumption has been increasing but we will increasingly see fossil fuel derived energy replaced with renewable energy which will mean a massive drop in energy consumed.  About two-thirds of the primary energy we now use is wasted (waste heat) and there is no reason to replace what we waste.

Quote
So based on the discussions here between SH and BW it seems we have agreement at last:

* It will take at least 2 decades/until around 2040 to switch to EVs and reduce oil consumption significantly.

* It could physically happen in ~5 years, but will not.

* The transition is a good thing but too slow.

It will take until about 2040 to get most ICEVs off the road but oil use should be considerably lower much sooner.  By 2030 we could see most buses and other commercial vehicles running on electricity.  That includes "18 wheelers".

If an order was given by the Ruler of the World we could move to only EV production in five years.  But, obviously,that won't happen. 

I doubt that we could remove all fossil fuel from the grid in five years.  I'd guess that it would take 15 to 25 years. 

The problem with "too slow" is what do you mean by too slow?  Obviously we won't dodge climate change because it's already happening.  We almost certainly will not avoid melting Arctic Sea Ice since that's apparently only a few years away.  Pretty much an 'any day now' thing.

Do you mean avoid extreme climate change which would kill off ~75% of the population and send the rest of us to live underground or in highly insulated buildings during the hot season?  If that's what you mean then I think we might be OK.

Wind and solar installations are ramping up rapidly as costs drop.  And costs should continue to drop.  I expect fossil fuel use to be less than 10% of what it is today by 2040 and down to about 0% by 2050.  I don't know what sort of climatic pain that would mean.  That's a question I'd put to a climate specialist like James Hansen.

Buddy

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Re: Oil and Gas Issues
« Reply #2493 on: June 21, 2018, 02:15:34 PM »
Per Bob Wallace:

Quote
Global oil consumption has been increasing.  It will almost certainly peak and then we will probably see demand decay by 2030.

Bob.... I hate to disagree with you.  But I don't think that demand for oil will "decay" by 2030.  I think it will be CRUSHED by 2030. ;)  Demand is more likely to START TO DECLINE by 2021 or 2022.

Some of you have heard of Tony Seba.  Someone (I forget again...sorry) had initially posted a video of Tony Seba.  Some of you likely have seen his video's.... some of you apparently have NOT.

For those of you looking for an UPDATED VIDEO of Tony Seba this year (I believe this is from March 2018) .... here you go.  Right from the horses mouth:



Tony is actually a little more AGRESSIVE in his predictions than I am.  I held my beliefs by looking at the same things that Tony was looking at (even before I heard of Tony).  It wasn't "rocket science" ..... but it DID take a lot of "observation of facts"..... and thinking how the next few years would play out.  So I didn't take up my position because of Tony Seba.  He's likely a MUCH, MUCH smarter guy than I am.  But it doesn't take "smarts" to look at this issue and arrive at pretty much the same place as Tony Seba (again ... I'm a little more conservative than him... but you get my point). 

I have stated that in the US, THE LAST NEW ICE ONLY PASSENGER CAR SOLD IN THE US WILL HAPPEN BY THE END OF 2025.  Tony thinks that will happen WORLDWIDE by 2025.  By the way..... the MAKERS of new cars, like VW ..... don't see Tony's predictions happening as well.  And yes.... I think they will be VERY, VERY WRONG.  Imagine that .... a company not seeing the future hitting them in the face (sarcasm intended).

Keep in mind.... that Tony's previous "prediction" about some of the "cost curves" have actually NOT come true.  HE HAS ACTUALLY BEEN TOO CONSERVATIVE in his prediction about the drop in price of lithium ion batteries for instance.  His prediction in 2014 was that batteries would continue to drop in price at the rate of 16% per year.  In fact.... they have been dropping at the rate of 20% per year recently.

And the oil market?  It is going to get decimated and soon.  I'm a big fan of 350.org and of Bill McKibben.  It is VERY DIFFICULT to be EARLY .... and to go up against a beast like fossil fuel companies.  Many continued cudo's to him.

But the "convergence" of technologies required to "slay that dragon" are indeed coming together even faster than Tony Seba had said 4 years ago.  And they continue to this day.

RE: Exxon Mobile.  Quit looking in the rear view mirror.  You're about to rear end somebody, and that somebody is a STEEP DECLINE IN OIL DEMAND that will likely start in a couple of years.  And the market....HAS ALREADY SPOKEN.

Oil prices peaked at $147 ..... years ago. July 11th, 2008 to be exact.  By December of 2008 it was $32.   :o

I encourage all of you to listen to the WHOLE VIDEO (about an hour).  It touches on the many things that are converging.  The cliff will be steep....









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Buddy

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Re: Oil and Gas Issues
« Reply #2494 on: June 21, 2018, 02:46:18 PM »
One other thing on "the oil market and Exxon."  What some of you apparently don't understand..... is that XOM (Exxon) is the "ugly sister" of the major oil companies.  So not only is the oil market headed for real trouble because of dropping demand in THE NEXT FEW YEARS .... Exxon has underperformed the oil companies, because Exxon has the HIGHEST COSTS IN THE INDUSTRY (cost per barrel).  There's a reason that XOM gets beat up.

And not only that..... they have been SLOW to head into the Permian Basin of west Texas and eastern New Mexico.  And of course....they have gone into the Permian at a time when prices for leasing rights are high.... so they have screwed themselves again.

I wonder if the US government would ever hire a crappy CEO from ExxonMobil to work in the US government?  Someone would have to be really stupid and horrible in his hiring practices to hire someone like a previous CEO of XOM......  ;)
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Shared Humanity

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Re: Oil and Gas Issues
« Reply #2495 on: June 21, 2018, 05:07:12 PM »
So not only is the oil market headed for real trouble because of dropping demand in THE NEXT FEW YEARS ....

Barring a collapse of the world economy (With the Orange Shitgibbon in charge starting trade wars, this is unlikely but increasingly possible.) oil demand will continue to rise for the next decade at a minimum. And we will not see demand drop below current levels for about another decade. At this point, oil demand could drop dramatically if we are doing it right.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2496 on: June 21, 2018, 06:56:40 PM »
So not only is the oil market headed for real trouble because of dropping demand in THE NEXT FEW YEARS ....

Barring a collapse of the world economy (With the Orange Shitgibbon in charge starting trade wars, this is unlikely but increasingly possible.) oil demand will continue to rise for the next decade at a minimum. And we will not see demand drop below current levels for about another decade. At this point, oil demand could drop dramatically if we are doing it right.

Predicting an exact point is pretty much impossible.  I think the two of you are pegging the ends of a likely range.

Buddy's short end of "the next few years" would need a fast rollout of robotaxis and we have yet to see a vehicle operate in real world conditions without human backup.  Proof and then buildout.  2025 might be a rough short end.

No drop below current use levels until 2038 assumes EVs are not available in large enough quantities to impact the number of ICEVs sold per year.

Personally, I think Buddy and Tony are being a bit too aggressive.  I might jump on board if a fully self-driving car appears by 2020.  But I'm closer to their end than the 2038 end.  I think we're going to see commercial vehicles move to batteries very quickly and that, along with the EVs manufactured by Tesla and Renault/Nissan, will be enough to bring us peak oil and demand decay before 2030.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #2497 on: June 22, 2018, 07:58:57 AM »
Quote
I might jump on board if a fully self-driving car appears by 2020.

Could you explain what that (assumption?) has to do with oil and gas issues (or energy use MV manufacture in general ) ?


Quote
Buddy's short end of "the next few years" would need a fast rollout of robotaxis and we have yet to see a vehicle operate in real world conditions without human backup.  Proof and then buildout.  2025 might be a rough short end.

No drop below current use levels until 2038 assumes EVs are not available in large enough quantities to impact the number of ICEVs sold per year.

Personally, I think Buddy and Tony are being a bit too aggressive.  I might jump on board if a fully self-driving car appears by 2020.

Buddy, as I said, is setting what I think is a very low end estimate for when we start seeing robotaxi use cutting into demand for oil.

I don't think it will be that quick unless we see reliable self-driving cars within the next two years.

Does that make it clear enough?

numerobis

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Re: Oil and Gas Issues
« Reply #2498 on: June 22, 2018, 11:27:55 AM »
I might jump on board if a fully self-driving car appears by 2020.

Could you explain what that (assumption?) has to do with oil and gas issues (or energy use MV manufacture in general ) ?

During the transition (now), we don’t have enough EV manufacturing to satisfy demand. When the factory delivers to a taxi company, that generally replaces more oil usage in the first year than delivering a vehicle to an individual.

We can do that now (I’ve ridden in electric taxis), but robotaxis combine that advantage with an increase in taxi miles driven.

The main risk is if the taxi miles driven steal from buses or staying home rather than from private cars.

Another advantage: robotaxis work just as well with minibuses. Shifting people from private cars to minibuses reduces energy use for operations, construction, and reduces traffic which improves conditions for everyone. Even better if the minibuses are electric.

gerontocrat

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Re: Oil and Gas Issues
« Reply #2499 on: June 22, 2018, 11:55:04 AM »
I might jump on board if a fully self-driving car appears by 2020.

Could you explain what that (assumption?) has to do with oil and gas issues (or energy use MV manufacture in general ) ?

The demand curve for oil is very inelastic (as it is for all necessities), i.e. relatively small shortfalls or excesses in supply cause large price swings. OPEC tried to kill the US fracking industry by turning on the taps, causing oversupply and a consequent large price drop. It did not work due to that technological improvements (spurred on by this price drop) meant the cost of extracting shale oil in the best fields in the US fell remarkably. It was this price drop that probably finished off Venezuela. Extraction costs are pretty low there, but the Venezuelan Government needed 100+ USD a barrel crude just to survive as it is totally dependent on oil revenue.

If / when EVs, robotaxis, whatever dent the demand for oil, even by just reducing the growth in demand, this might well cause a large price drop, especially in a market dominated by speculators.  OPEC would then either have to try reducing supply to raise the floor price, or take the lumps until high cost producers (e.g.s in marginal US shale fields, Canadian tars sands) go bust.

Capitalist ideology calls this "creative destruction". The people of Venezuela might call it simply destruction.
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