Peak Oil, Ghawar, and Why You Should Buy A Horse

I’m willing to wager most people haven’t heard the term “Peak Oil” yet. That’s about to change in the next few years. First, a little warning – this post will be pretty dense with info, and you might feel like you’re drinking from a fire hose as you read through it. Pucker up, I’m turning on the hose full blast.

Peak Oil is based on the idea that there is a finite amount of oil in the ground, and we will eventually reach the point where we’ve extracted half the oil on earth. As we get to the point where half the earth’s finite supply has been pumped out, a couple of things will start to happen. The total oil production will start to slow down, because we’ll start retiring productive oil fields. We won’t be able to replace lost oil fields by definition: To simply it a bit, say we’re actively running all the available oil fields on earth. If half of those run dry, there’s no place to go to find new ones. So we won’t be able to replace lost production. Let that sink in a moment – we won’t be able to replace lost production. So in effect, at point we reach about half the oil gone, we’ll reach a “Peak” moment – where production in future years will decline and there is nothing anyone can do about it, because we simply can’t find more fields to satisfy world oil demand. That’s a gross oversimplification, but you get the idea.

The fact is most of the continents are past peak and in oil production decline. That doesn’t bode well for maintaining the high standard of living we now enjoy, fueled mostly by, well, fuel. If we run dry, no more affordable airplane flights. No more car rides. No more machinery powering superefficient farms and no more lighter fluid for backyard barbecues.

We’ve been fine so far though, because there’s one area which so far has been pumping out plenty of oil: the Arabian gulf region. In fact, the gulf is home to Ghawar, the largest oil field which will ever be discovered on earth (if there was anything bigger we would have found it by now). Ghawar sits just on the coastline of Saudi Arabia, and the northern part of Ghawar contributes a whopping 55-60% of Saudi Arabia’s oil production. By extension, that means Ghawar is responsible for almost 15% of the world’s production. Fifteen percent from just one field. No other field comes close, and there is simply no way the Saudis can replace this field once it starts running dry. So once Ghawar is past peak production, Saudi Arabia is past peak production. Once the Saudis pass peak, the world is past peak.

Well, guess what: evidence is mounting that Ghawar peaked in 2005. what’s worse, there is also evidence that the Saudis have been too optimistic about the amount remaining. Even non-industry people have noticed.
The most conclusive evidence of a past-peak Ghawar field would be increased drilling with decreasing production, as the Saudis scramble to prop up output of a field in decline. Take a look at the following graph plotting new rigs in northern Ghawar on top versus the area’s oil production on the bottom (click for a larger view):

Not good. So should all go out and buy horses? I hope not. That’s pretty fatalistic, and nobody wants to return to a pre-industrial society. We’ll probably want to design hyper efficient tech goodies. We’ll probably want to stop suburban sprawl and make driving less frequent. Most importantly, we need to start pouring money into research on renewable and nuclear energy. The good news is we have time to start switching now, and we may be able to mitigate the crunch if we attack the problem from multiple angles.

I know what you’re thinking: “dude, we’ve got, like, technology and stuff”. It ain’t going to happen; technology won’t replace lost oil supplies. However, technology can be applied to develop commercially viable nuclear and renewable power. Time to get moving on that.

This entry was published on May 28, 2007 at 3:53 PM. It’s filed under Uncategorized and tagged , . Bookmark the permalink. Follow any comments here with the RSS feed for this post.

2 thoughts on “Peak Oil, Ghawar, and Why You Should Buy A Horse

  1. No combination of renewables can replace the energy density of oil. Post peak, the world oil production will decline at a min of 4 to 5% per year, while demand grows at a min of 1.8% per year. That leaves an absolute min gap between supply and demand of 5 to 7%, increasing each year. With flat out efforts, which we don’t have, there is no way we can produce 5 to 7% of the worlds energy needs added on each year from renewables. That is a fact, reality. If you don’t except this reality you are heading for disaster.

    The solution to this reality is to go after renewables at the fastest possible rate, at the same time reducing use of all energy possible. There is heaps of fat the trim. Right now do you think your TV is turned off, think again……it’s probably on standby using up to 20 watts of power while nobody is watching. Think your little 4 cyclinder car is efficient, well if you drive to work in peak hour traffic it’s probably getting less then half it’s mpg while it’s standing still in peak traffic and stop starting all the way to home and home. Do you drive the 500 meters to the shop for a carton of milk or a newspaper. As for you 6 cylinder drivers, and worse, V8s, if there was one group of people you could point the finger at that have caused this problem more then any other people on earth, it is you. Sorry to say it, but you have used twice as much as you need and we wouldn’t be having to deal with peak for a long time if it weren’t for you lot. You more then anybody will feel the pinch when you can no longer afford to drive your gallon guzzlers and have the additional expense of having to throw them away cause nobody else wants one, and buy a new more economical car. You will find it hard to get a second hand economical car because nobody will be selling them if they have one, and if you can’t afford a new one, guess you will be footing it and making up for your past accesses.

  2. Pingback: Hawaii Pushes the Renewables Envelope « Solar Crunch

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