End of the Binge

American Conservative ^ | September 12, 2005 Issue | James Howard Kunstler

[Shalom Israel]

in the New York City area the storm surge was devastating because it occurred at the worst time imaginable due to the following conditions

OK, that explains why I wouldn't remember it. Way up in Syracuse, if it affeected us at all, it must've been a garden variety bad blizzard. Sounds like NYC really got dumped on.

[Alberta's Child]

I remember the March 2003 storm, too. I remember seeing weather maps that showed the whole Eastern Seaboard of the U.S. covered with a large mass of clouds.

A friend of mine was on spring break in South Carolina, and the rain was still falling heavily down there when New York was getting the peak of the storm.

[A. Pole]

If my information is correct, major storms in the North Sea generate storm surges of no more than seven feet or so.

I think you are confusing the North Sea with the Dead Sea!

[ex-Texan]

Shale Oil is not going to work. It will never happen. Even if shale oil might be possible to develop, the process is sure to lose money. All recent efforts to develop shale oil have failed. Just "Goooogle it" yourself.

The collapse yesterday of Southern Pacific Petroleum marked the end of one of the most enduring and ambitious dreams of the local resources industry: shale oil.

In 1968, US business magazine Forbes heralded shale oil, essentially a process to extract oil from shale rock, as "a veritable treasure of black gold . . . so plentiful it can supply this country's needs for at least 200 years." The US never had a shale oil project.

When it collapsed, Southern Pacific was at work on the Stuart project near Gladstone, one of a clutch of shale oil prospects it held west of the Queensland regional centre. While there have been other resource dreams that came to nought - such as Australian Magnesium Corp - shale oil differed. It died a lingering death that began not long after the concept emerged at the start of the 1980s, when US oil giant Exxon said it would outlay a then unheard of $400 million to buy half the Rundle oil shale prospect from Southern Pacific and its Central Pacific Minerals stablemate. Southern Pacific and Central Pacific, for much of their life known as the Rundle twins, merged in 2002.

Doubts about the technical feasibility of extracting shale oil and environmental problems arose soon after Rundle hit the news, and were never resolved. It was a complex and inefficient process. In fact, shale oil is not actually oil at all, but kerogen, with the shale heated and the resulting vapour becoming liquid oil when cooled.

The numbers just never added up: shale oil was supposed to be economic with the price of oil at more than $US13 a barrel, while Southern Pacific had reserves in excess of 26 billion barrels of oil, not far off Libya's 29.5 billion barrels. The technical issues never were resolved and sceptical investors kept well clear of the shares. * * *

[elmer fudd]

" Which means that energy will be more expensive, which is the main point:

The end of cheap energy."

No. The authors claim wasn't just that energy prices would go up. It was that energy prices would spiral out of control and our way of life was doomed.

Energy prices undoubtably will go up, but we will find and develop other sources of energy, life will go on and people will continue to use more energy every year.

[Paul Ross]

Those "failures" were primarily economic based on overly-cheap conventional oil supplies.

E.g., There was a major shale oil push that was dashed in the early 80's when the Saudi's started dumping oil in response to Reagan's request. This was part of his larger designs against the Soviet Union. Which worked.

But, the U.S. shale oil development was an unfortunate financial calamity...collateral damage. So now that we have figured out how to do this extraction for a mere $10 per barrel...all bets against this are off. I doubt that we are never going to see spot-oil less than $50 per barrel again. You yourself believe we have hit peak oil already. Hence, all the more reason to go with alternatives. We just have to watch out for Eco-Wacko sabotage from the Left...who will try and drive up the cost via litigation.

You should also address the fact that the South Africans successfully employed shale oil when they were cut off by an international embargo.

Apparently the technical issues are not really so formidable anymore.

[ex-Texan]

The most recent failure was in Australia in 2003. That was in the report I linked. Or Gooooogle "shale oil + start ups." There are no major companies processing shale into oil today. There are a few companies looking for start up money. But nobody is doing it successfully today.

[ExSES]

The problem with all the doomists is that they always fail to account for human ingenuity. They assume that humans when standing in a ditch as the water approaches will not move.

Hmmmhhh..., haven't seen much of the news on Hurricane Katrina and "human ingenuity" I guess???

[Paul Ross]

The article was from Sydney Australia, but Southern Pacific Petroleum was a U.S. company, (one of the "Rundle Twins")...and the Gladstone Australia field is reputedly not as rich as the U.S. fields.

Furthermore, Southern Pacific Petroleum was extant during the early 80's correct? This was when the Saudi's DESTROYED the nascent U.S. shale oil industry. When just prior thereto...Exxon bid up the price of the fields with its $400 million purchase of shale oil fields?

Hence, isn't it likely that Southern Pacific also had a "legacy" debt that was debilitating from the standpoint of finishing off its R&D, and ramping up to economic production levels?

We all know this from other technolgy areas. It's called, "the bleeding edge." I.e., the first guys with the good ideas, don't always manage to get the prize. They more often lose their shirts...and then the passel of "me-too" characters horn in and avoid the mistakes of the would-be path-breakers. This is the oldest story in Capitalism.

[driftless]

I guess I've seen a lot of it. I was going to make my typical smartass comment about NO, but I thought in this situation, I better not. I should have. I didn't account for someone like you. lol.

[ExSES]

I guess I've seen a lot of it. I was going to make my typical smartass comment about NO, but I thought in this situation, I better not. I should have. I didn't account for someone like you. lol.

In these rather dismal days you have to throw a little levity into the mix! Actually, I agree with you, necessity being the "Mother of Invention" I am certain that we'll adapt technologically!

I do wonder about our ability to advance as humans however! Recorded history over the past few thousand years reveals that we have really not changed much at all (though we like to pretend that we have...).

[fallujah-nuker]

" Though to the brash claim that there won't be a hydrogen economy, H2 may be produced by electrolysis of water, with current supplied by nuclear power. This is a scheme that has no technological barriers, only political knots due to wrong perceptions of atomic energy."

I agree with you about the possibilities of using nuclear power to extract hydrogen from water, there may be other options besides electrolysis. Direct thermochemical production will be possible with advanced reactors operating at higher temperatures.

I do not think hydrogen would be useful as a transport fuel, due to low energy density per volume and difficulty of storage. One gallon of gasoline is equal to 2.3 gallons of liquid hydrogen. We should stick with our existing transportation fuels, gasoline, kerosene and diesel, using hydrogen as a feedstock. Carbon based fuels have proved themselves, no need to give them up, and it allows us to use existing infrastructure.

[fallujah-nuker]

"We don't have an oil based economy today either. If we did we would be in an economic depression. Instead we have a growing economy despite record oil prices. Even at it's current price our oil consumption is only about 4% of our GNP."

Trying getting to work to make your contribution to the GDP without oil.

[RightWhale]

What will happen is

On that, something will happen. The first effect is that those countries that are industrializing but are not yet affluent because they are starting late will find the cost of fuel to be more than they can afford. The already industrialized countries are already affluent and will bear the higher prices better. So, therefore, it follows, that the rich countries will continue to do fairly well and the poorer countries will be in a bind. The countries that have not industrialized will continue to be poor and won't notice the difference.

[fallujah-nuker]

"We all know this from other technolgy areas. It's called, "the bleeding edge." I.e., the first guys with the good ideas, don't always manage to get the prize. They more often lose their shirts...and then the passel of "me-too" characters horn in and avoid the mistakes of the would-be path-breakers. This is the oldest story in Capitalism."

The ghosts of Dad Joiner and Colonel Drake could tell you all about it.

[SteveMcKing]

Could one cook or heat a home with hydrogen? (ehh... "should", I mean.)

[RightWhale]

we'll adapt technologically

We'll adapt alright. We'll find ways to stay home and still do our jobs. Things like movie theaters and quick food restaurants might suffer, so I don't know where those people will look for work.

[RightWhale]

for ship use, coal is perfectly feasible

True especially for that. The present National Petroleum Reserve Alaska was originally a coal reserve for the Navy. Spanish-American war, I think. Then it became the Naval Petroleum Reserve Four. Teapot Dome was another. The coal is still there at PET-4, pretty much untouched.

[fallujah-nuker]

"Could one cook or heat a home with hydrogen? (ehh... "should", I mean.)"

That would be a more feasible application, but would still require new infrastructure. It would be most likely to happen with larger users of natural gas such as power plants. This is a wasteful use for gas, especially for supplying baseload power.

I could see a nuclear power plant being built near a gas turbine plant that supplies baseload power, the nuclear plant could produce hydrogen during off peak hours, which would be supplies to the gas turbine plant (having been modified from natural gas to hydrogen). The nuke would put out power 24/7 and the hydrogen gas turbine plant would run 6 to 8 hours per day during peak hours.

Other large customers could convert such as industrial boilers and smelters.

[fallujah-nuker]

"for ship use, coal is perfectly feasible

True especially for that. The present National Petroleum Reserve Alaska was originally a coal reserve for the Navy. Spanish-American war, I think. Then it became the Naval Petroleum Reserve Four. Teapot Dome was another. The coal is still there at PET-4, pretty much untouched."

Nuclear works good too. Imagine nuclear powered auto ferries running along the coasts, with speeds like the Finnjet. Services like the Viking and Silja Line ferries that do the overnight run between Stockholm and Helsinki. I could leave Seattle in the evening, spend 2 nights and a day at sea, and arrive in Southern California relaxed and refreshed in the morning.