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Showing posts from April, 2012

The Discrete Charm of Living at the Peak

In the summer of 1858, Edwin Drake punched 33 ft of cast iron pipe into the earth to prevent near surface water from collapsing the hole. He then lowered drilling equipment into the cased hole and used a steam engine to drill a successful, 69 ft deep well. On August 27th, shallow oil flowed almost to the surface and was recovered with a sump pump. Within 10 years more than 5,500 wells had been drilled, and 1,200 were producing oil. Edwin Drake made absolutely no money on developing modern drilling technology and died a poor man.

On January 10, 1901, captain Anthony F. Lucas drilled a well to a depth of 1,139 ft (347 m) near Beaumont, Texas. By chance, he created the "Lucas Gusher" that blew oil over 150 feet (50 m) into the air at a rate of 100,000 barrels per day (4,200,000 gallons per day). Because of that spectacular event, the modern oil industry was born overnight. By the end of 1902, more than 500 companies had been formed and 285 wells were in operation. Captain Luc…

The World is Finite, Isn't It?

Yesterday I gave a presentation to a group of distinguished business leaders.  In my presentation, I tried to show that the global rate of production of petroleum and the associated lease condensate is at an all-time high or a "peak" that at a greatly expanded scale looks like a "plateau."  I used my published, peer-reviewed extensions of King Hubbert's approach to support my arguments.

I received a significant push back from several members of the audience.  Their arguments were as follows:
King Hubbert tried to address the question of finite resources and today we know he was wrong.Even though Hubbert cycles emerge for individual oil provinces, they cannot emerge for the world.  We have been predicting the peak of global oil production for a long time and it never happened up until now.Technology will always be ahead of geology and, therefore, we will continue to produce ever more petroleum each year, just from different places, and at a higher price.Oil shale…