Replies

One more time:

Less oil has been found every year than has been produced since the 1980s. That is fact.

Reserve growth is not discovery. As per my previous posts, it appears to me that some of the reported reserve growth is pure nonsense. If reserves in Saudi Arabia remain the same and no new discoveries are occurring it is either magic or hogwash. Take your pick or suggest an alternate explanation, preferably one that does not rely on blindly believing the Saudis. I have set forth my case for Saudi reserve claims being “hogwash.”

Tar sands are not oil. Net energy production per barrel is much lower as a very significant fraction of the energy produced is used in production. Using natural gas to produce synthetic crude has been compared to turning gold into lead by Matt Simmons.

Finally, it is the extraction rate that is the problem. There is very little shut in production anywhere except in war zones. Almost no oil is being voluntarily withheld outside of OPEC and OPEC unused capacity is not that great. Saudi Arabia claims to have a couple of million barrels per day. Maybe half that amount in the rest of OPEC. If it can’t be produced are increasing rates, the existence of the reserves reported by the EIA doesn’t matter.

"If reserves in Saudi Arabia remain the same and no new discoveries are occurring it is either magic or hogwash. Take your pick or suggest an alternate explanation..."

I certainly don't trust the Saudis and as I've said I don't claim any knowledge of this subject but I recall reading somewhere that reserves are defined as what is "economically recoverable" under current technologies and costs/prices, and that secondary and tertiary methods of recovering more oil from existing oilfields have improved a lot over the past 40 years. I do realize that the added recovery methods consume more energy and expense for diminishing returns, but wouldn't Saudi fields be able to yield a lot more oil using advanced recovery methods, of course at much greater expense than the $5 per barrel they are accustomed to...... but that could account for significant additions to stated reserves (though of course probably not enough to offset all that they have pumped over the past couple of decades).

Also, speaking worldwide, with oil at $90+ per barrel or possibly a lot more in the future, perhaps for the indefinite future, wouldn't a lot of other existing fields (and possibly even shut down fields??) be capable of yielding oil that had previously been considered unrecoverable? I'm not saying this will make a critical difference (I have no idea what the numbers are), but do the declinist scenarios take account of changed incentives when oil prices get to historic highs and a lot of previously unrecovered oil is suddenly economical? Just wondering.....

Less oil has been found every year than has been produced since the 1980s. That is fact.

Oil Reserves have grown since the 1980. That is a fact. More oil has been added to the reserves than has been consumed. That is a fact.

Reserve growth is not discovery.

Whether oil is added to the reserves from exploring in new places, using new technology to find petroleum in places previous explored or using new technology to produce oil previously discovered and was not economically produceable all have the same results. More recoverable Petroleum added to the reserves. None of these are more valuable than the other.

Tar sands are not oil.

That is your opinion. The experts at the "Oil and Gas Journal" choose to include them in the reserves. I agree with them.

Net energy production per barrel is much lower as a very significant fraction of the energy produced is used in production. Using natural gas to produce synthetic crude has been compared to turning gold into lead by Matt Simmons.

Oil sands have produced their 1 billionth barrel back in 1998.

Oil sands now account for 39 per cent of Canada’s total oil production at approximately one million barrels per day. By 2020, production will grow to four million barrels per day.

Total Canadian production is projected to increase from the current 2.5 million barrels per day to reach 4.9 million barrels per day (b/d) by 2020.

Oil Sands Resources, Production and Projects
http://www.capp.ca/default.asp?V_DOC_ID=1162
Canadian Association of Petroleum Producers

Almost no oil is being voluntarily withheld outside of OPEC

As it has been since 1940 or earlier, long before OPEC existed. Nothing new or different about that.

If it can’t be produced are increasing rates, the existence of the reserves reported by the EIA doesn’t matter.

The amount of investment by oil companies is incredible these days. There is great expansion going on in exploration and facility expansion. This will bring continued expansion in the petroleum production.