From Climate Scepticism
By now the concept of peak oil seems almost like an anachronism.
There’s a long succession of predictions that we’d be out by now. There are claims by net zero types that oil companies are in danger of being stuck with stranded assets. Over the last two decades, there’s been a huge expansion of oil and gas from shale fracking in the US.
This expansion has been enthusiastically tracked in a huge number of posts at WUWT by geophysicist David Middleton.
Still there is some concern sometimes expressed on sceptic blogs about the limits of the shale revolution. Fernando Leanme is an engineer and blogger who comments a lot about politics and energy and has expressed concerns about the shale boom. He is a prominent critic of the RCP 8.5 scenario which in itself might be called a peak oil argument. There’s also Rud Istvan who’s very technically savey on energy and has written a couple of e-books that discuss the limits of oil and gas: Gaia’s Limits and Blowing Smoke: Essays on Energy and Climate.
The Decouple podcast just had Leigh Goehring of the commodities firm Goehring and Rozencwajg as a guest to talk about the end of the US shale expansion. He was also a guest on Decouple a year ago with the theme a Shortage of Everything. Both interviews have full transcripts.
His themes sort of harken back to those of a gold bug in the 70s (he even recommends owning some gold), but his scary scenarios are very well argued. I’ll list some points I found interesting in no particular order (there’s transcripts you can search):
- He claims all the US shales have peaked except for the Permian which he expects to peak soon. David Middleton appears to be still bullish.
- Goehring and Rozencwajg have a neural network model that says increases in US shale productivity have been due more to drilling in top tier sites rather than improved techniques.
- As non-OPEC production declines, OPEC will have means to control price.
- He says peak world demand is matching peak world supply for the first time in history.
- He says shales have to have certain characteristics to be exploitable. Large promising shales in Argentina, Columbia and Russia have political problems.
- The price drops in wind, solar and batteries can in large part be attributed to an era of cheap energy and capital which is ending.
- He calls the Inflation Reduction Act perhaps the largest malinvestment of capital in history.
- He claims EVs will never be competitive with ICE, because one of the key ingredients for EVs is energy.
- He is very pro nuclear energy and says the closing of Indian Point is the dumbest thing that could be done.
- He claims a large investor in Nebraska was lobbying for Diablo Canyon to be shut down so that he could sell coal fired electricity to California.
- He points out that Germany illustrates what happens when gas spikes. People move back to coal and wood.
- He says everyone should see the movie Planet of the Humans.
Make what you will of all this. I’ve lately been thinking that this shale gas bounty has been squandered on propping up wind and solar. There’s a couple of pictures I like to use on Twitter to show how California gets half of its electricity from gas and it appears to be slowly increasing:
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