Here’s something that will get the peak oil pundits up in arms. Oil industry analysts Cambridge Energy Research Associates (CERA) argue that the peak oil theory is based on “faulty analysis.”

It could, if accepted they argue, “distort critical policy and investment decisions and cloud the debate over the energy future”. They are arguing that the remaining global oil resource base is actually 3.74 trillion barrels — three times as large as the 1.2 trillion barrels estimated by the theory’s proponents.

“The global resource base of conventional and unconventional oils, including historical production of 1.08 trillion barrels and yet-to-be-produced resources, is 4.82 trillion barrels and likely to grow,” says CERA.

CERA Director of Oil Industry Activity Peter M. Jackson argues that: “The ‘peak oil’ theory causes confusion and can lead to inappropriate actions and turn attention away from the real issues,” Jackson observes.  “Oil is too critical to the global economy to allow fear to replace careful analysis about the very real challenges with delivering liquid fuels to meet the needs of growing economies.  This is a very important debate, and as such it deserves a rational and measured discourse.”

“This is the fifth time that the world is said to be running out of oil,” argues CERA Chairman Daniel Yergin, author of the oil-industry sop, The Prize.  “Each time — whether it was the ‘gasoline famine’ at the end of WWI or the ‘permanent shortage’ of the 1970s — technology and the opening of new frontier areas has banished the specter of decline.  There’s no reason to think that technology is finished this time.”

One Comment

  • Peak Oil is known to represent a global peak in conventional oil production, and eventually unconventional production. However, there is a higher meaning that must be considered. Peak Oil also represents “Peak Energy”. Peak Energy represents the moment at which the world no longer has as much net energy available to do work as before the peak. If you consider the problem from this perspective, then any debate about replacements to fossil fuels become moot.

    Oil is the most energy-dense material available to mankind. It has been used as a replacement to other energy resources precisely because of this unique quality. When you look at all available energy production together, you get a similar graph as you get when looking at conventional oil production graphs.

    Net energy is the energy available to society to do work after you remove the costs to obtain the energy.

    If you consider that peak oil means moving from the best energy source available to less energy dense sources, it is logical to assume that net energy available will decline. No matter how fast you can ramp up production of any other energy resource, the energy available after costs to extract have been removed will be less.

    This is quite simple if you think about it. Here are some of the consequences of a net energy peak and decline:

    1. There is less energy available to use for food production.

    2. There is less energy available to move people and products around the world.

    3. There is less energy available per capita (actually in decline since the late 70’s – early 80’s), which means less energy per person to perform your daily work.

    These reasons are why a move towards localization is not just recommended, but will be required. Globalization requires higher levels of energy than will be available.

    Society as a whole will have to sluff off the more complex layers (the ones requiring the most energy) to make up for the energy shortfall.

    So the big question is whether Technology can economize to the point that will allow less dense energy resources to be harvested with the same or greater net energy gain.

    As yet, there is no such technology available. Even technologically advanced conventional oil recovery results in lower net energy than the production yeilds from the last 50 years.

    I am not sure this argment has been effectivly refuted as yet.

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