[Congressional Record Volume 153, Number 9 (Wednesday, January 17, 2007)]
[House]
[Pages H655-H661]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PEAK OIL PRODUCTION
The SPEAKER pro tempore (Mr. Hall of New York). The gentleman from
Maryland (Mr. Bartlett) is recognized for 60 minutes.
Mr. BARTLETT of Maryland. Mr. Speaker, tomorrow we vote here in the
House on an energy bill. And I thought it might be appropriate to spend
a bit of time this evening looking at where we and the world are
relative to energy. I have here a chart with some numbers on it that
inspired 30 of our prominent Americans, Jim Woolsey, Boyden Gray,
McFarland and 27 others, among them retired four star admirals and
generals, to write to the President a letter which said, ``Mr.
President, we have only 2 percent of the world's oil reserves. We
consume 25 percent of the world's oil, almost two-thirds of which we
import. And that presents a totally unacceptable national security
risk. We really have to do something about that to free ourselves from
the necessity of buying foreign oil.''
The President recognizes that this is a problem. In his recent State
of the Union message he said that we are hooked on oil.
There are a couple of other interesting numbers here. We represent
actually a bit less than 5 percent of the world's population. We
represent about one person in 22 in the world. And with only 2 percent
of the world's oil reserves, we are pumping 8 percent of the world's
oil. What that means, of course, is that we are pumping our oil four
times faster than the rest of the world. We have been pumping less oil
each year now for several years, and with this high pumping rate that
decline will accelerate.
How did we get here? To find how we got here, you have really got to
go back about 6 decades. I didn't know last year on the 14th day of
March, when I gave the first speech here on the floor about peak oil,
that I was just 6 days beyond the 50th anniversary of what I think will
come to be seen as the most important speech given in the last century.
This was a speech given by M. King Hubbert, a Shell Oil company
geologist, to a group of oil people in San Antonio, Texas. At that
time, if you look back in your history books, you will see that we were
the largest producer of oil in the world. We were the largest consumer
of oil in the world, and we were the largest exporter of oil in the
world.
And M. King Hubbert shocked his audience by telling them that in just
about a decade and a half, roughly 1970, the United States would peak
in oil production. And no matter what we did after that, our production
of oil would decline.
I have here a curve which shows his prediction. His prediction is the
small green symbols here, and the actual data points are the larger
green symbols. And you see they reasonably followed his predicted
curve. By 1980, when Ronald Reagan took office, we were already well
down the other side of Hubbert's peak, and we knew very well that M.
King Hubbert had been right about the United States.
Now, in 1969, M. King Hubbert predicted that the world would follow
the United States in peaking in oil production about now. If he was
right about the United States, why shouldn't he be right about the
world?
It has now been 27 years since we knew, in 1980. We are already 10
years down the other side of what is called Hubbert's peak. And we knew
that he
[[Page H656]]
was right about the United States and he had predicted that the world
would be peaking about now.
If he was right about the United States, why shouldn't he be right
about the world? And shouldn't we have been doing something about
anticipating this world peaking oil production?
The red symbols there, by the way, are a similar curve for the former
Soviet Union, now today, Russia. And you see that when they fell apart
they did not meet their expectation, so they are now having a second
little peak, but they will follow the general downward trend.
How was M. King Hubbert able to predict this? We had already been
producing oil for quite a while in 1956, and M. King Hubbert had
watched the exploitation and exhaustion of some individual oil fields,
and he found that they always followed what we call a bell curve. Small
production at first, and then increasing and finally reaching a
maximum, and then falling off the other side.
This bell curve is very familiar. If you weigh people, some will be
very light and some will be very heavy, but most of them are somewhere
in the middle and they follow a bell curve. If you measure the heights
of people, they will follow a similar curve, or the number of mice in a
mouse's litter. There are just a great many things that follow this
kind of a curve.
So he noted two things, one, that most of the fields tended to be
exploited and exhausted in a bell curve, and when they had reached a
maximum, for the average field, half of the oil had been pumped. And so
he rationalized that if he knew how many fields the United States had,
and how many more we would discover, if he added up all the little bell
curves he would have one big bell curve which would indicate when the
United States would peak in oil production.
He did that. His math may be difficult to follow, but his reasoning
is pretty simple. He did that, and he predicted it would be 1970. And
right on schedule, we peaked in 1970.
I have been joined on the floor by my good friend, also from
Maryland, Wayne Gilchrest. And before I yield to him, I would just like
to introduce what he is going to talk about by quoting here from the
International Energy Agency. This is a recent press release. And what
they say here, ``The energy future we are facing today, based on
projections of current trends, is dirty, insecure and expensive. But it
also shows how new government policies can create an alternative energy
future which is clean, clever and competitive.''
They go on to say that ``energy demand increases by 53 percent
between now and 2030.'' Well, it may. The demand may increase by 53
percent, but the use will not increase by 53 percent because, as you
will see when we develop the subject this evening, the oil almost
certainly will not be there to meet this demand.
Over 70 percent of this increase comes from developing countries led
by China and India. World oil demand reaches 116 million barrels per
day in 2030, up from 84 million barrels today in 2005 and 2006 and
2007. That number really hasn't changed. We have been on a plateau for
the last 3 years of about 84, 85 million barrels of oil per day.
By the way, we use about 21 million barrels a day, about exactly one-
fourth of that. Most of the increase in oil supply is met by a small
number of major OPEC producers. Non-OPEC conventional crude oil output
peaks, they say, by the middle of the next decade. Most observers
believe that that has now peaked and, as a matter of fact, the world is
about to peak. These trends would accentuate consuming nations'
vulnerabilities to a severe supply disruption and resulting price
shocks. They would also amplify the magnitude of global climate change.
Mr. Gilchrest, I am pleased to yield to you. They introduce the
subject that I know you are very much concerned about, and that is what
our increased use of fossil fuels is doing to our climate and how it is
affecting global climate change and global warming.
Mr. GILCHREST. I have sort of a summary, I guess you could say, a
Global Warming 101 Introductory, which will take about 10 minutes, so I
am not sure how you want to proceed. Do you want me to just give this
sort of a 10-minute introduction to global warming, or break it up with
your dialogue?
Mr. BARTLETT of Maryland. I think that would be very instructive for
our audience. Please do.
Mr. GILCHREST. Congressman Bartlett is talking about peak oil, the
idea that our energy from oil is a finite resource, it is limited. And
what I would like to do, in conjunction with that, is to give a
perspective on one of the legacies of the age of oil, and that is
global warming, heating the planet, upsetting that delicate balance
between what the Earth has been used to for thousands of years, and the
natural range of fluctuation in the climate, to what we have done in
less than 100 years as a result of burning fossil fuel, oil in
particular.
So here is how I would like to proceed. Number one, the Earth has a
livable climate. The biosphere, which is the area of the planet that
contains life forms that we have become familiar with is possible
because of something called the greenhouse effect.
Now, in our atmosphere, we have oxygen, water vapor, methane, carbon
dioxide, a number of different chemical mixes which provide us with the
air we breathe and the type of atmosphere that produces, in part, the
climate that we have, hence the greenhouse effect. It is warm enough
and cool enough for life, as we know it, to exist.
Now, one of the most important greenhouse gases, other than water
vapor, other than oxygen, other than methane--all of these contribute
to the greenhouse effect--is carbon dioxide, or CO2.
Now, even though carbon dioxide is less than 1 percent of the makeup
of our atmosphere, it is critical in the heat balance of our planet.
Now, that sort of gives us an idea of the importance of these
greenhouse gases and the importance of carbon dioxide.
Now, is the Earth warming? There is no question, everybody would say
yes, the Earth is warming, and it has been warming for the last 10,000
years. It has been warming for the last 10,000 years because that was
the end of the Ice Age 10,000 years ago, and sea level has been rising,
and the planet has been warming all of that time.
{time} 2100
It is warming, in part, because there is an increase in carbon
dioxide in the atmosphere. Ten thousand years ago, and you can evaluate
this by looking at ice cores and checking the bubbles out, and see what
the content in our atmosphere of CO2 was by looking at those
bubbles in ice cores from Greenland or the Antarctic, and
CO2 was about 180 parts per million in the atmosphere 10,000
years ago. CO2, a greenhouse effect, or a greenhouse gas,
was at 180 parts per million 10,000 years ago.
If we move forward almost 10,000 years to the year 1890, in 1890,
CO2 in the atmosphere was 280 parts per million. It took
just about 10,000 years for CO2, a greenhouse gas, which
helps the balance of Earth's climate, it took almost 10,000 years for
it to increase almost 100 parts per million.
Now, let us look at the year 2000. In the year 2000, CO2
was 380 parts per million. In effect, the natural causes before the
Industrial Age were really in full swing. The natural causes gradually
warmed the planet over 10,000 years very slowly.
What we have seen in the last 100 years, actually, about the last 50
years, is a dramatic increase in the amount of carbon dioxide in the
atmosphere, something like we have not seen for hundreds of thousands
of years and perhaps millions of years. So CO2 in the
atmosphere right now is 380 parts per million. We haven't seen that
much CO2 in the atmosphere for 800,000 years. Now, as a
result of this, we are going to see some changes in our climate.
Let me make this last comment, though, about CO2 in the
atmosphere, about the heat balance, about how the greenhouse gases
intermix with the atmosphere. Human activity, burning fossil fuel, has
put into the atmosphere in a little more than 50 years what the natural
processes took out of the atmosphere, and it took more than millions of
years to effect. In less than 100 years we have changed the atmosphere
more than the natural processes of the Earth have changed the
atmosphere in millions of years.
Now, what are the ramifications of this? Well, warmer seas and warmer
temperatures. If we want to associate
[[Page H657]]
that with hurricanes, we have more frequent, stronger hurricanes as a
result of that. Warm seas are fuels for hurricanes.
What is that doing to our economy? What is that doing to our coastal
communities? What are some of the other implications?
Well, one other significant implication is sea level rise. If you
went to Ocean City 10,000 years ago, and we know Ocean City in Maryland
was not there 10,000 years ago, if you went to Ocean City, where Ocean
City was supposed to be 10,000 years ago, you would have 75 more miles
to go before you got to the ocean; 10,000 years ago you would walk from
Alaska to Russia, easily, there was a land bridge, a wide land bridge.
Today we know that you can't. That is because sea level has been
rising, and it has been rising because of the natural consequence of
global warming, but now there is a significant change. For example, the
temperature has increased, sea level temperatures have increased. In
the last 20 years we have lost 40 percent of the volume of the Arctic
ice. The Arctic ice cap, we have lost 40 percent of the volume of that.
Let us take a look at Greenland. In Greenland, it has 630,000 cubic
miles of ice, Greenland, 630,000 cubic miles of ice. If that were all
to melt, sea level around the globe would rise 23 feet.
Now, we know that Greenland's ice shelf is melting. Recently it was
discovered that it is melting 10 times faster than anybody could have
ever anticipated. A few years ago, it was losing about 80 cubic miles
of ice a year, a few years ago. Today, just a matter of a few years
later, it is losing now, and it is accelerating, 80 cubic miles of ice
are melting every year.
When I say melting, it is not dripping. This is running off. In fact,
the greatest contributor to fresh water to the world's oceans is not
the Nile River, it is not the Amazon River, it is ice melting, pouring
off the ice shelf of Greenland.
What is that going to do to our coastal communities, our coastal
economies? What happened in Katrina, in Louisiana and Mississippi and
Alabama? What is happening in a fairly more frequent occurrence to
States like Florida or South Carolina, or even States like ours, the
State of Maryland? What other changes might there be?
CO2, carbon dioxide, is being absorbed at an increasing
rate by the world's oceans. How will the oceans change as a result of
this absorption of CO2? It will become more acidic. The
ocean chemistry will actually change in the ocean, and it will become
more corrosive.
What is the problem with an acidic ocean that is more corrosive? Some
of the best habitats in the world for the world's most abundant
fisheries are coral reefs. Coral reefs cannot survive in an acidic
ocean. A whole host of ocean creatures will be disrupted in their
process to reproduce or in their process to exist at all. There will be
warmer temperatures in the atmosphere, increased forest fires,
increased infestation, increased invasive species, changing in
agriculture practices, changing in weather patterns. There would be
more significant rain storms, more significant snow storms.
Storm cycles would be difficult to predict, shifting in vegetation
zones, habitat lost for a whole range of flora and fauna species and 40
percent of ice lost in the Arctic ice shelf right now, and
accelerating, may be gone by this midcentury, a whole range, including
polar bears or endangered species.
The coastal economy, the coastal economy in the United States is 50
percent of our GDP, 50 percent of our GDP. The likelihood of sea level
rise as a result of all of this is going to be between 1, and more
likely, at least 3 feet, that will clean out, wipe out, disturb,
destroy most of the coastal cities in the United States on the Atlantic
and gulf coast.
We are looking at New York City, Boston, Wilmington, Baltimore,
Philadelphia, coastal areas from Maryland down to Florida, including
Miami. Much of the peninsula of the State of Florida will be under
water, not to mention, if you look at the State of Maryland, much of
the peninsula, the Delmarva peninsula.
The natural range of fluctuation has been disrupted by the burning of
fossil fuel, by oil, a limited resource, the end of the Oil Age and
what are the consequences, the last 100 years of the Industrial Age,
the age of fossil fuel, the natural range of fluctuation for
CO2, methane gas.
The temperature range in the last 10,000 years has been fairly close
and predictable. Now, imagine a straight line, and what does a hockey
stick look like? We have corresponded the increase in CO2
with the increase in atmospheric temperature, the increase in land
temperature, and the increase in sea level temperature. All of this
corresponding to the increase in burning fossil fuel, and as a result,
the increase of methane carbon dioxide.
I want to end with a quote from a gentleman called Norman Cousins,
who had an illustrious career in journalism and in politics. Norman
Cousins says, ``Knowledge is the solvent of danger.'' And the key to
the successful understanding and opportunities for a brighter outcome
with what Congressman Bartlett is talking about as ``peak oil,'' the
end of the age of oil, and its consequences in global warming, the key
to understanding and finding a solution is knowledge.
Mr. Bartlett, thank you very much for the time.
Mr. BARTLETT of Maryland. What the gentleman has been talking about
is more than valid reason for pursuing the development of alternatives,
if no other. Why would we want to increase CO2 more? Why
would we want to threaten more the quality of life in this world?
The Congressman and I have been to Antarctica twice; one of those
trips we went together. Down in Antarctica, 90 percent of all the fresh
water in the world is locked up in the ice there. It is nearly 2 miles
high, and 70 percent of all the world's ice is locked up in Antarctica.
Now that hasn't really started to melt yet, although it has threatened.
I am told that calculations indicate that if the polarized caps in the
Greenland ice shelf, if they were all to melt, the ocean levels would
rise 200 feet.
Now, if you look around the world you will note that a big percent of
the world's population lives within 200 feet of sea level. This would
be a monstrous, monstrous change.
There are three very good reasons for pursuing alternatives, which is
what the bill tomorrow is going to be talking about. One of those is
certainly a climate change, because what we are doing now is releasing
CO2 that was bound up in these plants and organisms that
grew aeons ago, and it took many, many years to tie up the
CO2. Now we are releasing it very quickly as we burn these
fossil fuels.
A second reason, of course, is I just don't think that the oil is
going to be there, which is what we are talking about tonight as ``peak
oil.''
The third really good reason for doing it is the reason the President
advanced, and that is, it really is a big national security risk to be
so dependent on foreign oil.
What I have here on this chart is another depiction of Hubbert's
peak, and this is by the Cambridge Energy Research Associates, commonly
referred to as CERA, and they are trying to indicate that one should
not have confidence in the predictions of Hubbert because his curve
didn't exactly actually follow his prediction.
Well, by golly, it is pretty close to actually following his
prediction. Here is the U.S. actual production in red. You will see
there is a little second peak here, and the next chart will show that
is because of Prudhoe Bay. We found a lot of oil there, but that was
not in M. King Hubbert's prediction. He hadn't imagined that we would
be going to the North Slope of Alaska to drill.
So the little yellow ones here are his prediction. Notice that the
actual Lower 48 has followed very closely, very closely, his
prediction. We are now down to, even with Prudhoe Bay, we are now down
to about half, about 5 million barrels a day. That is the red one over
there, as compared to roughly 10 million barrels a day at our peak.
The next chart shows better where their oil comes from. Hubbert's
prediction covered the Lower 48, and that is this gray area here. Now
we need to add to that gas liquids. The big find in Alaska here, and
that is what causes this little blip here in the downward slope. I
remember a number of years ago, these fabulous discoveries of oil in
the Gulf of Mexico, which is supposed
[[Page H658]]
to solve our problem for the foreseeable future, that is the yellow
there. Notice it hardly makes a shadow on the downward slope of
Hubbert's peak.
The next chart is really a chart that we could spend a long while
talking about because it has a great deal of information on it. The
bars there represent the discoveries, and you notice that we were
discovering oil way back in the 1930s, big discoveries in the 1940s,
and then lots of discoveries which peaked about 1970, and since then it
has been going down, down, down.
The solid black line here indicates the amount of oil that we have
been using. Notice that for a long while we were accumulating big
reserves of oil; everything about this solid black curve is reserves
that we have in store that we can use later.
{time} 2115
But then in about 1980 there, you can see these two curves cross. I
say two curves, because obviously you could draw a smooth curve through
the peaks here, and these two curves crossed about 1980. Ever since
1980 we have been burning more oil than we found. Today we burn two or
three barrels of oil for every barrel of oil that we find. So for this
period, between 1980 to the present, we have been using up some of the
reserves that we have back here, but still a lot of those reserves
remain.
Now, what will the future look like? Well, there is a big difference
of opinion in what the future will look like. The persons that put this
chart together believe that by about 2010, about 3 years or so, the
world will peak in oil consumption. Some believe that it has already
peaked, others believe it may peak a little after 2010, and then it
will go down.
Now, they have made some guesses as to how much oil we are going to
find. I am not sure I would have drawn that curve exactly that high,
because a smooth curve might bring you down about here. I think they
have been very generous in the amount of oil that is yet to be
discovered.
By the way, the world's experts on oil believe that we have, most of
them, we have probably found about 95 percent of all the oil that we
will ever find. You notice that when we find oil now, we find it in
very difficult places to get to. The last big find was in the Gulf of
Mexico, through 7,000 feet of water, and then about 30,000 feet of rock
and dirt until you get down to the oil. We aren't now developing that
field, and I am told, you can be told a lot of things that aren't true
and I don't know the veracity of this, but I am told we will be
developing that field when oil reaches $211 a barrel, because that is
what it will cost to get the oil out of that field.
I just want to spend a moment looking at this before we go to the
next one. If you draw a smooth curve through these bars, the area under
that curve represents the total amount of oil that we have found, and
the area under the consumption curve will represent the total amount of
oil that we have consumed.
Now, it is very obvious that you can't consume oil that you haven't
found, and you can make the future, within reason, look anyway you
like. But what you can't do is pump oil that you haven't found. Unless
you believe that we are going to find a whole lot more oil than
indicated by their projection, then you have some choices as to what
that downslope is going to look like.
You can be very aggressive and use enhanced recovery techniques, you
can pump steam down there, you can pump CO2 down there, you
can flood it with sea water as the Saudis do to get their oil out. You
get it more quickly. But if you get it more quickly, you have less to
get later on.
So we have choices facing us as to what that downslope will look
like. But, remember, you can't pump oil you haven't found, and the area
under the consumption curve cannot be larger than the area under the
discovery curve. They have to be the same area ultimately, the same
volume.
Here is a prediction by our Energy Information Agency, and it is a
very interesting one, and they use some unusual statistical approaches.
But this is a curve through the discovery peaks. Let me put the other
one up just quickly so you can see the similarities here.
Notice the big peak here in the late 1940s and 1950s and another peak
here. They have kind of smoothed that out here. You can see this is the
early peak here and then the later peak and then down, down, down.
We get to the point we are at now, and they make some very unusual
predictions. The yellow line there, they say, is the 95 percent
probability, and the green line is the 50 percent probability, and the
blue line is the 5 percent probability. And they say that the 50
percent probability is the average, the mean, and, of course,
probabilities and means don't mean the same thing, so therefore, that
is what our production is more likely to be.
Surprisingly, this curve that has been going down for a number of
years they thought was going to turn around and go up. But notice for
the roughly 5 to 10 years after they drew this first curve, notice the
red symbols there. They have been following what you would expect they
would follow, and that is the 95 percent probability. Ninety-five
percent probably is a whole lot more probable than 50 percent probable,
and that is what it has been following.
Here is another chart from CERA, and it shows something very
interesting. First, I want to look at the left here. This is the low,
they say, is the 95 percent probability. Now, the 95 percent
probability is the most probable, so it is not the low, it is the most
likely.
Then they say the high probability is almost 4,000 gigabarrels. The
mean is right in the middle. Most of the experts in the world believe
that we have found about a little over 2,000 gigabarrels of oil. I use
the term ``giga,'' because a billion in England is a million million,
and in our country a billion is a thousand million. So everybody
understands giga. A giga is a thousand million. We have consumed about
half of that and about 1,000 gigabarrels, maybe a little bit more, but
roughly a thousand gigabarrels remains.
Several Congresses ago I was privileged to share the Energy
Subcommittee on Science, and I wanted to get some idea of the
dimensions of the problem we face, so we had the world's experts come
in for a hearing. And I was surprised at the unanimity. It was like
from 970 to 1,040 gigabarrels of oil remaining in the world, not a big
spread.
Now, what they are showing here is that if in fact we find as much
more oil as all the oil that now remains discovered, if we find as much
more as all the oil that remains discovered, we will still peak at
2016, 9 years from now, if we find as much more oil as all the oil that
now exists, that we know exists in the world. If you don't find that,
then we peaked about now and it is going to start down this way.
Another thing they have shown here is if you aggressively develop
these fields and pump life steam down there or put CO2 down
there or pump sea water down there, you can get it more quickly. But
then look what happens. It falls off more quickly too.
Again, the area under this curve has to be the same thing as the area
under this curve. You can't pump more because you are pumping it
faster. Now, with enhanced oil discovery, you might get a little more,
because you might get some oil that you wouldn't have gotten with
conventional techniques.
Here is another more recent chart from the Oil Information Agency.
They have been pooh-poohing the idea of peak oil. They said it was
going to be an undulating plateau. I agree, it is going to be an
undulating plateau. So they show here with what I think are wildly
optimistic estimates of how much oil we are going to find, they believe
that we are going to find twice as much more oil as all the oil we now
know exists. That just isn't very probable.
But even if we find that much oil, they have a peak. Notice it. They
say it is an undulating plateau. I agree. With the world's economies
and demands and warmer temperatures, which is why oil is down a bit
now, because we have warmer temperatures in our country, I agree it is
going to be undulating plateau. They are pooh-poohing the idea of peak
oil, and they show in this curve peak oil. They show it I think a good
many years beyond when it will actually occur.
This little curve down here is closer what I think is reality. They
have 1.92 trillion, and it is just a bit over 2 trillion, I think, so
maybe it would extend
[[Page H659]]
a little beyond this. But notice they are showing this peak about now,
aren't they? So if we don't find this enormous amount of additional
oil, it will be peaking about now. What they are saying is if we have
only 2.93 trillion, we will be peaking at this point.
I have a quote here from one of the world's experts on oil, Dr.
Laherrere, and this is what he says, and I think that it is kind of
difficult to argue with his logic. Jean Laherrere made an assessment of
the USGS report.
Now, it is the USGS report that provides the data that permits CERA
to make their prognostications. He concludes that the USGS estimate
implies a five-fold increase in discovery rate and reserve addition for
which no evidence is presented. Such an improvement in performance is
in fact utterly implausible, he says, given the great technological
achievements of the industry over the past 20 years, the worldwide
search and the deliberate effort to find the largest remaining
prospects. Today we have 3-D modeling and seismic use, and so we know
pretty much what the world's geology looks like.
I might take just a moment to talk a little bit about this geology,
because it is very important in understanding how much more oil we are
likely to find.
How did the gas and oil get there? Well, nobody was there when it got
there, so we really don't know, but one of the best guess its is that a
very long time ago the Earth was very much warmer than it is now. As a
matter of fact, there were subtropical seas at the North Shore of
Alaska. In the North Sea, there were subtropical seas. And every cycle
the vegetation grew, and then when it matured or if there was a fall,
and it may have been warm enough there was no true fall, but still
there was a cycle of life, and it grew and sank to the bottom as algae
does now in the ponds and so forth. And then waters washed erosive
materials off the surrounding hills and it mixed with the organic
material. This continued for an a large number of years until there was
a lot of mixture of organic material and inorganic material there.
Then the tectonic plates of the world moved, and we know that
happened, and it opened up and sank and went down to a depth where the
temperature was appropriate, closer to the molten core of the Earth,
and where the pressure was appropriate, and then cooked there under
this pressure for who knows how long, and this organic material, mostly
plants, maybe a few small animals, gradually became what we know as
oil.
Now, the oil is made up of molecules of varying lengths. Some are
very short and they are in fact gasses, if you let them escape from the
oil. Some of them are very long, and that makes the waxes and so forth
that we find in oil.
Now, if there happened to be a rock dome over top of this deposit way
down there that is now being cooked and pressurized for a long while,
if there is a rock dome over that, the gas that escapes will be trapped
under that rock dome. So when you come along and drill a well through
that, and you get down to the oil, the oil is going to be under
pressure because of that gas above it. So you have what you call a
gusher. The gas pressure above pushes the oil down and up the drill
pipe and it continues to gush until that gas pressure has been
relieved.
Now, this may not be the way that oil and gas were formed, but there
isn't any better guess as to how it was formed. And if that is in fact
the way it was formed, then we can make some guesses as to how much
more oil and gas we are likely to find, because we have done a pretty
good job of matching the geology of the Earth.
What you need to find is some of this organic material buried deeply
for a long while with a rock dome over it so it captures the gas. By
the way, if it doesn't capture that gas, you end up with something like
the tar pits of California, and you end up with the tar sands, they
call them oil sands, they are tar sands, thank you. They flow about as
readily as the blacktop driveway out here, unless you heat them up,
which is what they do, and combine them with some shorter chain
molecules so that when they cool they will still flow.
The loss of these gasses has produced what we call our oil shales in
the west. By the way, there are huge, huge deposits of these tar sands
and oil shales.
As a matter of fact, the deposits of each of those represents way
more than all the fossil fuels that we now know exist in the world, and
the Canadians are making some heroic efforts because their big fields
are up in Alberta, Canada, and they have a shovel up there that lifts
100 tons and they dump it into a truck that carries 400 tons and then
they carry it and cook it. When it is cooked, why, the oil flows and
then they mix it, as I said, with something with shorter molecules, a
solvent, so when it cools it will flow and they move it out through
pipes. With this heroic effort, they are getting about 1 million
barrels a day. That sounds like a lot, 1 million barrels a day, but we
use 21 million barrels a day. That is about 5 percent of what we use,
and just a bit over 1 percent of what the world uses, because the world
uses about 84-85 million barrels a day.
And what they are doing is not sustainable, because they are cooking
this with natural gas that is what we call stranded. By ``stranded'' we
mean there are not very many people there to use it, and natural gas is
hard to transport unless you liquefy it and are near a port, so it is
cheap. So I understand they may be using more energy from natural gas
to produce the oil than they are getting out of the oil. But from a
dollar and cents perspective, it makes sense, because the gas is really
cheap and they are producing that oily understand for $12 to $25 a
barrel, again, you get various estimates of this, and they are getting
$50 to $60 barrel for it. So dollars and cents-wise, that makes good
sense.
{time} 2130
From an energy profit ratio, it does not make any sense at all.
Natural gas is a high quality feed stock for an enormous petrochemical
industry.
One of the things that we use it for, by the way, is making nitrogen
fertilizer, and without our ability to make nitrogen fertilizer, we
could not begin to feed the world. It is not just the plant breeder,
and he has done marvelous with developing new plants. It is all of the
fossil fuel energy we use in agriculture, and a great deal of that is
used in making nitrogen fertilizer from natural gas.
I have next a little schematic here, and this kind of smoothes out
these curves. By the way, the world has been increasing its use of oil
about 2 percent. That does not sound like much, does it, 2 percent? But
2 percent exponential growth doubles in about 35 years. It is four
times bigger in 70 years, and it is eight times bigger in 140 years.
Albert Einstein was asked after the discovery of nuclear energy and
the detonation of the nuclear bomb, Dr. Einstein, what will be the next
great energy force in the world? And he said the most powerful force in
the universe is the power of compound interest. Exponential growth.
I have a namesake, no relative. I wish I had some of his genes. He is
really very brilliant. Dr. Albert Bartlett, professor emeritus at the
University of Colorado, he gives the most interesting 1-hour lecture I
have ever heard on the failure of our industrialized society to
understand exponential growth. Just do a Google search for Albert
Bartlett and energy, and it will come up and you will be fascinated
with this 1-hour lecture.
Here we show this little schematic curve. It is a 1 percent growth
rate. Remember, that doubles in 35-years. This point is twice as high
as this point, and that represents 35 years. Notice that the shortage
occurs before we reach the peak.
The shape of the bell curve and the exponential growth curve indicate
that you are going to have shortfalls in supply, price is going to go
up before you might reach the peak, and maybe, just maybe, we are in
this time right here. A lot of the evidence indicates that is true.
The next chart is one that really gives you some pause when you look
at it. Let us just look at the upper one because the bottom one is an
expansion of the upper one, separating the gas from the oil here in the
red curve. But this shows only what 400 years, a little less than 400
years of more than 5,000 years of recorded history. The use of energy
in our world was so small back in 1750 that that brown there which is
[[Page H660]]
wood is just about the baseline, is it not?
The industrial revolution started with wood. The hills of England
were denuded to make charcoal to make steel. Catoctin Furnace, a little
historic site up in Frederick County, they denuded the Catoctin
Mountains where Camp David now is, thankfully the trees grew back, they
denuded that making charcoal for that furnace.
The industrial revolution really took off when they discovered coal,
and it was stuttering when they finally discovered gas and oil. Then
look what happened.
The hockey stick, that is the hockey stick that Congressman Gilchrest
was talking about, look what it did. It just goes straight up. Notice
here what happened in 1970. There was a real oil price shock there, and
the world used somewhat less oil. We are now very efficient in the way
we use oil in this country. Air conditioners probably are twice as
efficient at least as the ones you used in 1970. If it were not for our
increased efficiency we would be in even more trouble with energy
today.
But what I want to point out is that we are about 100, 150 years into
the age of oil. That is this. If Hubbert was right, and he was exactly
right about the United States, why should he not be right about the
world, this is going to be a bell curve. By the way, you can make this
thing look steeper or shallower depending upon the dimensions and the
ordinates, the absinthe ordinate and abscissa. Here, of course, we have
400 years on the abscissa so it is very compressed so it makes the
curve look higher, but that is exactly the same kind of curve we have
here. We just spread out the abscissa here so that we spread it out. If
you really push these two things, that is going to peak up high in the
middle.
Out of 5,000 years of recorded history, the age of oil will represent
about 200 to 300 years, remaining about 100, 150 years. What will our
world look like post age of oil?
The next chart shows us something that is alarming a number of
people, and this is a little drawing of the world. It has a number of
symbols on it, and one of those symbols shows where China is securing
rights to buy oil, and they are all over the world. This symbol here
was Unocal. They almost bought Unocal, one of our oil companies. They
are buying oil all over the world. They are scouring the world for oil.
I just came back from a trip to China, and we went there to talk
about energy by the way. I was pleasantly surprised when they began
their discussion of energy by saying post-oil. They get it. I wish we
did. They talk about post-oil. They recognize that they are big
polluters. As a matter of fact, I have a reference here that says by
2010, just 3 years from now, they will be a bigger CO2
producer than we are, in just 3 years. Their economy is growing, the
last 2 quarters, at more than 10 percent a year. That doubles in 7
years. It is four times bigger in 14 years. It is eight times bigger in
21 years, 1.3 billion people. I saw essentially no bicycles on the
street and traffic jams like we have at rush hour here in Washington.
Well, the fact that they are scouring the world for oil indicates
their understanding that this is going to be a resource in short supply
for the future. We can spend a long time talking about China and what
they are doing. They are aggressively building a blue water navy.
A blue water navy is different than the brown water navy, brown from
the silt that comes out the rivers near shore, little navies that
protect you from somebody coming from afar. They are rapidly developing
a blue water navy. Last year, for instance, we launched one submarine.
They launched 14. Now, their submarines are not ours but 14 submarines
is 14 submarines.
I have here a very interesting statement from our Secretary of State
Condoleeza Rice: ``We do have to do something about the energy
problem.'' I am thankful you recognize that. ``I can tell you that
nothing has really taken me aback more as Secretary of State than the
way the politics of energy is I will use the word `warping' diplomacy
around the world. We have simply got to do something now about the
warping now of diplomatic efforts by the all-out rush for energy
supply.''
It would be nice if everybody in the administration understood that
and we were doing something meaningful about it.
So what do we do? Well, I think that any rational person would
understand that you need to get busy developing some alternatives if
you are going to run out of these fossil fuels. By the way, these
fossil fuel are just incredible. The energy in these fossil fuels is
just unreal.
I have an article, really not an article. It was a speech given by
Hyman Rickover in 1957, 50 years ago this year, and I want to read
something that he says here which is really interesting. He understood
50 years ago, ``With high energy consumption goes a high standard of
living. Thus the enormous fossil fuel energy which we in this country
control feeds machines which make each of us master of an army of
mechanical slaves. Man's muscle power is rated at 35 watts
continuously,'' little more than you are working, but you have got to
sleep, ``or one-twentieth horsepower. Machines therefore furnish every
American industrial worker with energy equivalent to that of 244 men,
while at least 2,000 men push his automobile along the road, and his
family is supplied with 33 faithful household helpers. Each locomotive
engineer controls energy equivalent to that of 100,000 men; each jet
pilot of 700,000 men. Truly, the humblest American enjoys the services
of more slaves than were once owned by the richest nobles, and lives
better than most ancient kings. In retrospect, and despite wars,
revolutions, and disasters, the hundred years just gone by may well
seem like a Golden Age.''
And it has gotten even more golden in these last 50 years, has it
not?
Hyman Rickover understood very well our dependence on fossil fuels.
One barrel of oil controls the energy of 12 men working all year for
you. If you figure out what that costs, it is less than $10 to purchase
the equivalent work of a person all year long.
Now, if you have some trouble getting your minds around that, imagine
how far that gallon of gasoline or diesel fuel carries your car. And by
the way, it is considerably cheaper, a little over $2 a gallon, than
water in the grocery store.
Now, how long would it take you to pull your SUV or your car or push
it as far as that little gallon of gasoline or diesel fuel take it? I
own a Prius. We get under normal road driving conditions 51 miles a
gallon. It would take me a long time to pull my Prius 51 miles.
Another indication of the incredible energy benefit from fossil
fuels, if you work really hard all day long, I will get more work out
of an electric motor for less than 25 cents worth of electricity. It
may be humbling to recognize in terms of fossil fuel that we are worth
less than 25 cents a day, but that is the reality, and that is why we
live so well.
As Hyman Rickover understood 50 years ago, if that was true what he
said 50 years ago, it is true in spades today, is it not, because we
have even more helpers to make our life quality higher as a result of
our use of energy.
Well, what do we do if we are going to run short of fossil fuels?
Obviously, we have no surplus oil to invest in the development of
renewables. If we did, oil would not be $50, $60 a barrel, but we can
free up some oil and buy some time with a very aggressive conservation
program.
Matt Simmons, who has written a really good book on Saudi Arabia
called ``Twilight in the Desert,'' and he makes the case that Saudi
Arabia has probably peaked in oil production. They will not tell you
that, but you notice they cannot make good on any promise to increase
oil production so he may very well be right. Then after having freed up
this energy and bought some time, we must use it very wisely. We would
get a lot of benefits from that.
Life is just so easy in this country that we are bored. We are
watching awful movies. We are doing drugs because we are bored. There
is no exhilaration like facing a big challenge and besting that
challenge. There is nothing that puts flavor in pie so much as work,
and I can imagine Americans, when they understand the problem we face,
going to bed at night saying, gee, today, I used less energy than I did
yesterday and I lived just fine, and tomorrow I am going to do better.
[[Page H661]]
But we need leadership that is not here yet so that we will do that.
By the way, big benefits. We could once again become a major exporter.
We are the most creative, innovative society in the world. Properly
challenged, we will figure ways to get this alternative energy. We
could again be a major exporter. Today, we are a big, big importer, as
you know, $800 billion trade deficit this year.
We are a role model whether we like it or not. When you use 25
percent of the world's energy, you are a role model. Not a very good
one today. We profligately use energy, way more energy than the average
person in the world. It really is possible to be much more efficient.
This is a fascinating chart, such a simple one, but what it shows is
the heat that you get out of an incandescent bulb and the light you get
out of it. Ninety percent of it is heat which is why I use an electric
bulb for brooding little chickens. I am not so much interested in the
light as I am the heat from it. Now fluorescents are much better, and I
saw there was a Time magazine cover page that had a pile of coal there.
I think it was on the cover page, and they have one of these screw-in
fluorescent bulbs beside it. Five hundred pounds of coal, that is the
amount of coal you save in the life of that one fluorescent bulb, that
is here.
But notice what you get out of light omitting diodes. I have a little
light omitting diode flashlight that I carry. I put two little
batteries in it, and I have forgotten when I put them in.
{time} 2145
It just lasts so long. We have the same amount of light out of each
one of these, but notice the enormous amount of heat you are getting
out of the incandescent bulb and the tiny amount of heat that you are
getting out of the light emitting diode.
There are lots of opportunities in our society to live well and
comfortably using a lot less energy. I don't have the chart here, but
the average Californian uses only about 65 percent as much electricity
as the rest of America, and it would be hard to argue that Californians
don't live well.
This next chart is a really interesting one, and what it shows here
on the abscissa is the amount of energy that we are using per person
and what it shows on the ordinate here is how good you feel about life.
You couldn't feel any better than 100 percent, and notice where we are.
We are the biggest users of energy in the whole world and we feel
pretty good about it; but notice how many countries that use less
energy than we feel even better than their quality of life. Let's go
way back here to Colombia. They use a fifth as much energy as we; they
feel almost as good about their quality of life as we feel.
If you drew a curve through this, you need some minimum energy to
feel good about life, but once you go up that steep part of the curve,
the minimum energy is pretty flat. We can move way back here on the
curve and feel just as good as we do now about life. You don't have to
use the amount of energy that we use to feel as good about life as we
do.
The average European, the countries are scattered through there, but
the average European uses half the energy we use and, by the way, pays
more than twice as much per gallon of gasoline and they have been doing
that for a very long time.
We are shortly going to run out of our 60 minutes this evening and we
will need to come back to finish this, but obviously we have got some
finite resources here that we can use. When we come back, we are going
to talk about the resources available to us to meet the challenge of
transitioning from fossil fuels to renewables. And, by the way, we will
transition either on a time scale that we have chosen or on a time
scale chosen by geology.
As we run down the other side of Hubbard's Peak and the world has
less and less supply of fossil fuels, we will transition. It can be a
bumpy ride, or it can be a really bumpy ride. But Americans are up to
it. We need leadership and knowledge. And we will be back again to talk
about the finite resources available to us and all those fascinating
opportunities in renewables.
____________________