

One of the live oaks that bless my home

Saturday, November 10, 2012

Sir Francis Bacon's Warnings

In 1620, in his Novum Organum,  Sir Francis Bacon classified the intellectual fallacies of the human kind as idols of the Tribe,  the Cave,  the Marketplace and  the Theater. An idol is a mental image which receives veneration but is devoid of substance. Bacon did not regard idols as symbols, but rather as human fixations.  His model of human perceptions is as true today as it was in the 17th century. Some things never change but - because of the mindless and loud media drumbeat - consequences of the common human fallacies are far more damaging today. 

Idols of the Tribe are deceptive beliefs inherent in the minds of all humans. They are abstractions of error arising from common human tendencies of exaggeration, distortion, and disproportion. Thus people gazing at the production of crude oil over the last century perceive endless growth, and are not content merely to contemplate or record that which is seen. They extend their opinions, investing oil fields with innumerable imaginary qualities. In a short time these imaginings gain dignity and are mingled with the facts until the truth and fiction become inseparable. This statement would describe much of the current public debate about energy.

Idols of the Cave are those which arise within the mind of an individual. Man's mind is symbolically a cavern. The thoughts of the individual roam about in this dark cave and are modified by temperament, education, habit, environment and accident. Thus an individual who dedicates his mind to some particular branch of learning becomes possessed by his own peculiar interest, and interprets all other learning according to the colors of his own devotion. The chemist sees chemistry in all things and the businessman sees profits where there aren't any. 

Idols of the Marketplace are errors arising from the false significance bestowed upon words. People mold their thoughts into words in order to communicate with others. The words carelessly used without attention to their true meaning condition our understanding and breed fallacies. Thus, refinery gains and corn ethanol become crude oil. Words often betray their own purpose, obscuring the very thoughts they are designed to express.

Idols of the Theater are those which follow from the paradigm of the moment and false learning. These idols are built up in theology, philosophy, social sciences, and natural science. They are defended by learned groups and accepted without question by the masses. When false philosophies have been cultivated and gained wide dominance in the world of the intellect they are no longer questioned. False superstructures are raised on false foundations, and in the end systems barren of merit parade their grandeur on the stage of the world. This statement might describe most of the current popular beliefs about energy production and sources, or climate change, or healthcare, or education, or agriculture, or so many other important but misunderstood issues that will punish us, clueless Earthlings, with vengeance.
Parts of this text were adapted  by Tad Patzek from 4 Idols by Manly P. Hall and from Encyclopedia Britannica.

P.S.  The Dallas Times Herald clipping below was sent to me by Roger Baker, my ASPO friend. He found this clipping in an old book on micropaleontology loaned to him by a son of Bob Schroeder, a Shell Oil geologist aware of peak oil. This 1980 warning was issued by none other than Sheik Ahmed Zaki Yamani, the Saudi Oil Minister, also famous for saying 20 years later: "The Stone Age did not come to an end because we had a lack of stones, and the oil age will not come to an end because we have a lack of oil."
Click on the image to see it in full size.  Source: Roger Baker's ASPO email, 11/10/2012.
P.S.P.S. An opposing view is presented by The New York Times, where a journalist repeats that the world is awash in oil, quoting an expert from Harvard.

Sunday, November 4, 2012

Peak, What Peak?

Before I discuss the logic behind negating a peak of production of anything, let me sum up where we are in the U.S. in terms of crude oil production.  According to the Energy Information Administration (EIA):
The United States consumed 18.8 million barrels per day (MMbd) of petroleum products during 2011, making us the world's largest petroleum consumer. The United States was third in crude oil production at 5.7 MMbd. But crude oil alone does not constitute all U.S. petroleum supplies. Significant gains occur, because crude oil expands in the refining process, liquid fuel is captured in the processing of natural gas, and we have other sources of liquid fuel, including biofuels. These additional supplies totaled 4.6 MMbd in 2011.
Let me parse this quote.  First, let's look at the history of oil production in the U.S., shown in the chart below.  The vertical axis is scaled with a unit of power, exajoules (EJ) per year, very close to quadrillion BTUs (quads) per year.  To convert from EJ/year to millions of barrels of crude oil per day (MMbopd), divide the vertical axis by roughly two, so 20 EJ/year is roughly equal to 10 MMbopd.

Now, let's look at the refinery gains in the second chart. These gains arise because petroleum products are usually less dense than the crudes they are made from. Therefore, refinery gains are not really a replacement of imported crude oil, and demonstrate only that since 1993, the U.S. refining has been moving towards heavier crude oil feedstocks.
Oil refinery gains reported by EIA since 1993 hover around 1 million barrels of all petroleum products per day.  These gains arise because the densities of petroleum products (gasoline, kerosene, diesel fuel, jet fuel, heating oil, etc.) are less than the density of crude oil they were made from.  It is like making a low calorie butter or cheese from a normal butter or cheese by puffing them up with bubbles of air.  Through refinery gains, we have not created new energy. Instead, we have just puffed up the crude oil feedstock by cracking heavier hydrocarbons and hydrogenation, both requiring considerable energy inputs. Thus, refinery gains do not really count as a new source of energy, but only as a source of an increased volume of petroleum products.

Corn ethanol comes next.  I described the ethanol story completely in 2004, in my most popular paper ever. There was nothing new I would add in the intervening 8 years. Basically, ethanol is obtained from burning methane, coal, diesel fuel, gasoline, corn kernels, soil and the environment. We destroy perhaps as many as 7 units of free energy in the environment and human economy to produce 1 unit of free energy as corn ethanol, and make a few clueless environmentalists happier and a few super rich corporations richer. The story is even worse for switchgrass ethanol. Finally, your mileage would drop by 33% if you were to use pure ethanol as a fuel for your car.
Production of corn ethanol in the U.S.  Because ethanol has a lower heating value, its volume would be much lower when converted to equivalent crude oil. 
Production of soybean biodiesel in the U.S. is too low to get excited.
Production of soybean biodiesel in the U.S. is almost irrelevant, but also highly environmentally damaging. Since most of the obliteration of the irreplaceable biota occurs in the tropics, in Brazil, Argentina, Africa, and Asia Pacific, we really don't care.  Either way, the rate of biodiesel production in the U.S. is too low to write home about it.

In summary, of the 4.6 million barrels of the other "oil"  produced in 2011, 1.1 MMbopd were refinery gains, and another 0.6 MMbopd was the equivalent volume of oil corresponding to the production of roughly 0.9 MMbpd of ethanol.  Biodiesel production was in the noise. I fear that EIA simply added volumes of the various fuels without converting them to oil equivalents based on a common oil density and heating value. The rest of the other "oil", 2.9 or 2.6 million barrels of oil equivalent (again I do not know how EIA made their conversions) were natural gas plant liquids.  All of these liquids are significantly less dense than crude oil, and a proper conversion lowers their volume contribution by 35 percent.

Needless to say, refinery gains do not inject new energy into the U.S. economy, just add volume. Also, propane and butane are not crude oil, and ethanol is not a hydrocarbon. The only hard number here, 5.7 MMbopd of crude oil production is something to write home about.  This level of production requires an incredible amount of new technology and technical skills that are available only in the U.S. My department graduates each year about 150 petroleum engineers of all levels, who make this huge effort such a smashing success. Their starting salaries are in excess of three-four times the national average for college graduates. And they all have jobs.

In conclusion, Russia is using similar technology to increase their rate of crude oil production to over 11 MMbopd, and Saudi Arabia is barely hanging in at 9-10 MMbopd.  Both these countries also produce large volumes of lease condensates and natural gas plant liquids. The rate of U.S. crude oil production is a little more than 1/2 of either of these two rates, and we are no Russia or Saudi Arabia when it comes to producing oil per unit time. But this is just fine, so let's stop deluding ourselves with such tenacity.

In the next blog, I will talk about the various techniques of denying existence of peak oil (or climate change, or anything else we fear or do not like).

P.S.  So, did I miss anything in my discussion of the EIA quote at the top of this blog?  Think carefully... Yes, I did.



And, you, corn ethanol lovers, read this and fear the future.

P.S.P.S.  Five years after my well-researched plea to the EU Ministers of Environment and Transportation, EU is considering limiting use of biofuels:

The European Commission intends to limit the use of biofuels derived from food crops to 5% for transport fuel. This would be a substantial change to its present biofuels policy. According to the EU’s climate-change and energy commissioners, Europe wants to cap the share of energy in the transport sector from food crop-based biofuels at current levels. The proposal, a draft of which was reported by Dow Jones Newswires, clashes with the target of having 10% of the energy used in transport coming from renewable sources by 2020. This goal was set by the EU three years ago because food crop-based biofuels account for most biofuels available in volumes at the moment. New types of alternative fuels are being developed, but they are mostly at the laboratory stage. At the same time, biofuels are expected to be the main renewable energy source used in transport in 2020.
Despite the obvious insanity of the last sentence, I say: Better late than never, dear Europe, and much better than the U.S.A., which seems to have a policy of accepting campaign donations from mega agricultural companies and all kinds of other companies, rather than having an energy policy.

(P.S.)-cubed on 11/13/2012. The Wall Street Journal insists on an alternative reality view of EIA reporting, by stating in a Review&Outlook piece, "Saudi America," that:
I have no idea what IEA predicts, but I surely know that this number is incorrect, if it implies current production of liquid hydrocarbons in the U.S.A.