peak oil time...time to learn to shoe a horse

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OVER A MILLION BARRELS OF OIL A DAY LOST TO DEPLETION

 

[This is the clearest proof that not only is Peak Oil here, but that

it is hitting sooner and harder than expected. These are numbers

that cannot possibly be argued with. -MCR]

 

NEWS RELEASE

 

For Immediate Release:

Tuesday, 24 August 2004

 

The world is now losing more than a million barrels of oil a day to

depletion – twice the rate of two years ago – according to a new

analysis published this month in Petroleum Review, the oil and gas

magazine of the Energy Institute in London.

 

The analysis shows that output from 18 significant oil-producing

countries, accounting for almost 29 percent of total world

production, declined by 1.14 million barrels a day (mb/d) in 2003.

The annual rate of decline also appears to be accelerating, contrary

to the widely held view that depletion progresses slowly.

 

Based on data in the latest BP Statistical Review of World Energy,

production from this group of 18 countries peaked in 1997 at 24.7

mb/d and by 2003 it had fallen to 22.1 mb/d. In 1998 their total

production dropped by less than one percent, whereas last year it

declined by nearly five percent.

 

" It appears that depletion is now becoming a much more significant,

though largely unrecognised, consideration in the supply-demand

equation, and may be contributing to the rise in oil prices, " said

Chris Skrebowski, Editor of Petroleum Review and a Board member of

The Oil Depletion Analysis Centre (ODAC), who prepared the new

analysis.

 

" With world oil demand surging faster than anyone expected, it is no

wonder that current supplies are stretched to the limit, " he said.

 

By re-ordering the BP data on a continuum from those producers with

the largest declines to those with the largest gains, his analysis

shows that in 2003 the producers still able to expand production had

to increase their total output by over 7.5 percent to achieve

overall world production growth of about 3.7 percent.

 

" Looked at in this way, you see a quite different and more worrisome

picture from the one presented in the BP report, " Mr Skrebowski said.

 

" Those producers still with expansion potential are having to work

harder and harder just to make up for the accelerating losses of the

large number that have clearly peaked and are now in continuous

decline, " he said.

 

Declining oil production from entire countries, as opposed to

individual fields or regions, is a recent development. Until the

1990s, only two countries were in decline, including the United

States where production peaked in 1971 and began continuously to

decline in 1985. By the late 1990s, the BP statistics showed at

least 10 significant producers in decline. Two more were added each

year from 1999 to 2001.

 

These are some other key findings in the Petroleum Review report:

 

Gabon, where output peaked in 1996, tops the list of countries in

sustained decline with production there falling over 18 percent in

2003, more than double its average decline rate for the last three

years.

 

Australia saw its production drop more than 14 percent in 2003,

almost twice the average decline rate since it peaked in 2000.

 

UK production from the North Sea, which peaked in 1999, posted the

world's fourth largest decline in 2003 at nearly 9 percent.

 

Indonesia, an OPEC member, has been in decline for 12 years,

averaging 2.6 percent a year, but over the past few years this has

accelerated to 8.5 percent last year.

 

Having confirmed that its two largest producing regions are now in

decline, China, with only modest production growth of 1.5 percent

last year, looks likely to go into decline soon.

 

" We have also seen quite spectacular growth rates from some of the

countries that are still expanding their production, but in most

cases it seems unlikely that such large increases can be repeated or

sustained without massive new investment, " Mr Skrebowski noted.

 

" With little or no spare production capacity now available around

the world, production expansion will depend mainly on new project

start-ups. However, at the moment we see very few of these scheduled

to come onstream after 2008, " he said.

 

" Clearly at some point – perhaps sooner than many might expect – the

losses and gains will balance out and global oil production will

then tip into decline. "