First posted on Sunday, November 25, 2007
Mr. Reynolds' Passing Acquaintance with Fact
Jeff Berg
I just yesterday finished writing my first ever article about Neil Reynolds: 'Mr. Reynolds, The Business Pages & The BAU Bargain'.
After what was basically my first glance at the history of his Globe & Mail work provided by the Globe website I had thought that he was a fairly harmless albeit foolish industry shill. http://www.theglobeandmail.com/opinions/columnists/Neil+Reynolds.html
After this most recent piece however I am thinking that I am going to have to revise my opinion of him from foolish shill to dangerous fool. http://tinyurl.com/2rqp5g
What Reynolds said on November 23, 2007:
1) "Petrobras, the Brazilian oil company, announced a couple of weeks ago the discovery of a huge offshore oil field - described as the second-biggest discovery of conventional crude anywhere in the world in the past 20 years. Known as Tupi, the field holds more than eight billion barrels of oil, only slightly less than Norway's entire reserves. Business Monitor International says that Tupi will enable Brazil to export a million barrels of oil a day within five years, enough to get Brazil full membership in the Organization of Petroleum Exporting Countries. Brazil has confirmed already that it's thinking about it." (my emphases)
The SPIN:
A) The find is described as "huge".
B) It is talked about in terms of many "billions" of barrels.
C) It is favourably compared to Norway's reserve.
D) It is being written about in the Globe & Mail Business Pages so the writer "must" have done his research and know what he is talking about, no?
What you need to know:
A) The total estimated find of 8 billion barrels is less than 1/3 of one year's supply at current global consumption rates.
B) It will take five years to ramp up to 1 MMb/d. The amount of depletion within five years from really occurring wells that will need to be replaced by actual production as opposed to theoretical reserves is on the order of 20 to 25 MMb/d.(Chris Skrebowski Petroleum Review) http://www.energybulletin.net/5395.html
C) Despite the glaring lack of sufficiency of this find for offsetting the really occurring rates of depletion, Reynolds stresses that this is one of the two largest finds in the last twenty years! He writes this as if it supports his argument when the most cursory of looks at the facts immediately points out the exact opposite conclusion.
This teapot of a tempest from the fact challenged mind of Mr. Reynolds reminds me very much of the "Peak Oil Don't Know Jack" story from this past year. Also carried in the Globe's ROB. A title given to the story about a find of 500 million producible barrels with a potential "that may contain as much as 15 billion barrels of oil" found 30,000 feet down in the Gulf of Mexico. (Ah the power of the weasel word "may".)
THE SPIN:
A) Huge find! Multi-billion barrels.
B) Deepest well ever drilled: "Look what technology can do today.!"
C) "Potentially" one of the biggest finds in the last ten years.
D) Story title, "Peak Oil don't know Jack"
What you need to know:
A) 500 Million barrels is not quite 6 days worth of oil at current global consumption rates. 15 Billion is ½ of one year's global supply.
B) There is precisely one rig in the whole wide world that can drill this deep.
C) If they do actually get the full 15 billion out of this field then it will be one of the biggest finds of the last twenty years. Again this fact is proof positive that we are moving further and further away from being able to exceed or even match depletion not the opposite.
D) David Hughes, 30+ years as NRCan and CGS geoscientist, said of the Jack find. "This discovery has yet to prove itself economic and may well not in the end." Aka. It may like much of the "great" Caspian finds end up costing more to drill than it extracts.
Mr. Reynolds next great find:
2) "Oddly enough, though, the biggest discovery of conventional oil this year went largely ignored - notwithstanding the fact that it took place in the continental U.S., where such things are not supposed to happen. The U.S. National Energy Technology Laboratory (NETL) made the relevant announcement earlier this year as follows: "Researchers at Texas A&M [University] and the Department of Energy have produced a new computer tool that will increase recovery of as much as 218 billion barrels of bypassed oil remaining in mature domestic fields. Two hundred and eighteen billion barrels of conventional oil. Note that this is almost 10 times the proven reserves (22 billion barrels) of the United States. Note that this is enough to run the U.S. economy for the next 25 years." (my emphases)
THE SPIN:
A) 218 billion barrels! 10 times current U.S. reserves.
B) "Note…..enough to run the U.S. economy for the next 25 years."
C) All you'd need do is get 200 barrels per well that's nothing!
D) This is in the Globe & Mail Business Pages so the writer "must" know what he is talking about, no?
What you need to know:
A) "Reserves should be an indicator of future production. Unfortunately it appears to be the other way around." – Professor Dave Rutledge, Chair of Cal Tech's Division of Engineering and Applied Science.
N.B. What this means is that the best indicator of future reserves is production not vice versa. Ergo the fact that the U.S. production has been declining for the last 37 years is a very good indication of U.S. reserves and therefore Mr. Reynolds is to put not too fine a point on it a nutbar.
B) This situation is completely analogous to Canada's natural gas production problem and amenable to the same clarifying analysis. I.e. Pool size distribution analysis is a clear indicator of where production is going. In other words as the pools get smaller and smaller so too eventually does production. Not a difficult stretch for most minds to grasp but obviously out of the reach of Mr. Reynolds.
One could also throw in the fractal law of self-similarity and its power to describe more than just demography but let us call it a day shall we as Mr. Reynolds is quite simply not capable of "going there".
C) Mr. Reynolds is in fact incapable of even the most basic of math problems. E.g. The U.S. consumes 20 MMb/d = 7.3 billion barrels of oils per day. Ergo 218 billion barrels = 30 not 25 years of supply. If he was hoping by the "downsizing" of this number to thereby save himself from any charge of exaggeration he misunderstands the discipline of resource geology and the facts that it has unearthed even more grossly than I here accuse him.
And yes I do understand how many might think that this article could mean "peak oil gets deferred by a generation". And ideally you should not take my word for it but instead delve as deeply into the subject as you need to in order to arrive at a self-generated data supported answer.
The reason I suggest this latter course is that we are going to need as many data warriors as we can possibly get if we Peak Energists are going to rout the field of ideologically driven yabos like Mr. Reynolds as thoroughly as the Climate Change folk have routed Brent NS, and Terence Corcoran, and their like.
The following line tells you all you need to know about Mr. Reynolds real agenda. "The fact is we don't need legislation to end the energy crisis. The oil companies and the car companies have got us pretty well covered - upstream and downstream, coming and going."
By the by, he is a former Libertarian Candidate who's never met a tax cut he didn't like or a free trade deal he wouldn't sign sight unseen. To put it most simply. For ideologues like Mr. Reynolds facts are intelligence to be cherry picked for their effect and used to support what you already "know" to be true NOT to inform or change ones opinion. In their world that would be 'flip-flopping'. What this instead means to an empiricist is I think best said by JK Galbraith (paraphrased): "I don't know what you do Sir, but when I encounter new facts I change my opinion."
Such a man as Reynolds will almost certainly never understand the difference between dogged opinion, aka dogma, and a data driven understanding of those human disciplines that are illuminated by supported theorems. Aka The intellectual architecture of the modern mind.
Enough said.
Text source: Jeff Berg is a member of www.postcarbontoronto.org and www.pledgeTOgreen.ca
A listing of other articles by Jeff Berg can be found here.
