Peak Oil

Australia’s Declining Oil Self Sufficiency

Australia’s Oil Vulnerability – The Key Trends

As the world enters the Peak Oil era, it’s important to identify some of the trends which contribute to Australia’s oil vulnerability. Significant risks to Australia’s liquid fuel security currently exist and it is possible to identify future trends which will see this fuel security decline even further.

Let’s take a look at what some of the current oil vulnerabilities are for Australia and then examine what this could mean in the future, when oil depletion begins in earnest.

1. Australia’s Declining Oil Self Sufficiency

In absolute terms, Australia is largely self‑sufficient in the coal and gas needed to provide energy to its economy and society. However, the same cannot be said for oil and petroleum products which account for 34 per cent of total energy consumed in Australia and 97 per cent of the vital transportation sector.

Australia’s oil production peaked in the year 2000 and has declined overall since then (figure 1). Liquid fuels production will continue to decline because production from new domestic projects has not been able to offset declines from currently producing fields.

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Figure 1: Actual (blue) and predicted (red) Australian crude oil production

While Australia’s oil production is already in decline, national consumption has risen steadily by around 20 per cent over the past decade. Australia is a net importer of both crude oil and petroleum products (Figure 2) and the trend towards increasing net imports is set to continue in the coming decades.

Australia oil_production_consumption

Figure 2: Australia’s total oil production and consumption (1992-2014)

Net imports currently account for about 60 per cent of Australia’s consumption, however Australia’s oil self-sufficiency is actually far less than the remaining 40 per cent would suggest. The Carnarvon Basin off Northwest Australia accounts for 72 per cent of total Australian liquids production. Most of this bounty is exported due to the lack of regional refining capacity, the proximity to Asian markets and the ability to demand premium prices for the light, sweet grade of oil produced in the region. Subsequently, the country’s North and Northwest regions completely rely on imports of refined liquid fuel products.

Presently, only 17 per cent of the feedstock used in domestic refineries comes from domestic crude oil, down from 37 per cent a decade ago. Figure 3 illustrates just how little of Australia’s indigenous crude oil is refined into products that meet the end needs of Australia’s citizens and industries.

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Figure 3: Australian liquid fuels supply and usage.

The Australia Senate noted in 2007 that:

‘Australia’s self-sufficiency in oil is expected to decline into the long term as reserves are depleted and because of rising demand.’

 

What’s Really Up With This Business in Libya?

It seems like the world has turned upside down since the beginning of the year. I’m trying to make sense of it all, so I plan to spend a bit of time over the next few weeks discussing the big events; what may have led to them and what might be the outcome. First up….let’s talk about Libya.

When the West decided to intervene in Libya my first thought was, “Of course…Libya has oil”. After all, plenty of humanitarian crises are occurring in other parts of the world and yet they are left alone to sort their own problems out. Oil makes Libya a special case.

However, from politicians and talking heads on TV I was hearing that this was not about oil, because Libya only has about two per cent of the world’s oil production. They claim that they were going into Libya because they had learned their lesson in the 90’s and didn’t want another Kosovo on their hands. Two percent is supposedly nothing in the global oil supply….a mere blip, which the global economy could care less about.

And yet, Libya is a big deal. Why is it that a potential loss of only two per cent of the world’s oil production is cause for expending huge amounts of money launching air strikes against Col Gaddafi’s regime? (With warheads containing depleted uranium no less…. but that’s a whole other story)

When we look at the percentage of European oil imports that come from Libya, the story becomes a lot clearer. More than half a dozen European nations rely on Libyan oil for more than 10 per cent of their oil imports. This then is one obvious reason for the West’s intervention in Libya. Industrialised economies cannot afford to lose access to 10-23 per cent of their oil imports.

Source

But given the relatively small quantity of oil passing from Libya to North America, why is the US so heavily involved? Is it just a matter of the US helping out its NATO allies or is there more to this than meets the eye?

Dr. Paul Craig Roberts, former assistant secretary of US Treasury provides some insight on the revolution in Libya in a recent interview. He states:

In my opinion, what this is about is to eliminate China from the Mediterranean.  China has extensive energy investments and construction investments in Libya.  They are looking to Africa as a future energy source.

The US is countering this by organizing the United States African Command (USAC), which Qaddafi refused to join.

[…]

In my opinion, what is going on is comparable to what the US and Britain did to Japan in the 1930s. When they cut Japan off from oil, from rubber, from minerals like ore; that was the origin of World War II in the pacific. And now the Americans and the British are doing the same thing to China.

The geopolitics of oil is a very interesting subject and occurs very much outside of the spotlight of the mainstream media. It is my opinion that the great world powers are fully aware of the oil shortages upon our doorstep and are manoeuvering to control access to the remaining deposits of conventional oil. What concerns me is how this might play out. What we are now seeing in Libya could be the beginnings of the 21st century’s first great war.

The other interesting story surrounding Libyan oil is that Saudi Arabia pledged to raise production to offset the decline from Libya, and yet Saudi Arabian production remains flat. Could this be an indication that the kingdom actually no longer has the spare capacity to meet the global demand for oil? From the Daily Reckoning:

For better or worse, most of the “spare capacity” burden falls on Saudi Arabia. Saudi princes claim to be able to goose production from 9 million barrels a day to 12 at the drop of a hat.

Never mind that they’ve never done anything like that before, even when oil ran up from $25 to $147 a barrel between 2003-08. The official line – and, therefore, the oil market – still believes it’s true.

Bottom line: “Saudi Arabia can’t make the shortfall from Libyan supplies,” says commodities investing legend and Vancouver veteran Jim Rogers. “They’ve said in the past that they can increase production, but they can’t.”

To me, this is just one more indication that we are very close to, or past the peak in global oil production. If a loss of two per cent of the world’s oil supply cannot be made up by OPEC’s ‘swing producer’, and is cause for military posturing, then surely we are in a desperate place indeed.

What we hear from the media is that this latest run up in prices at the fuel pump is simply a result of speculators and freaked out investors, coupled with typical Easter long weekend price hikes. What they are missing is that the end of cheap oil is here. We have now entered a world of highly volatile liquid fuel prices, and just about anything could happen. Oil production can no longer keep pace with demand and desperate times call for desperate measures. Hold onto your hats, we could be in for a wild ride.

Weekend Without Oil

If you prefer to walk or bike instead of using a car, enjoy being outside, use reusable bags, avoid plastic bottles, eat meat sparingly or not at all, research makeup and cosmetic products for safety, carry a refillable water bottle, and generally avoid buying crap you don’t need and using the stuff you do have as long as it is useful, then you are well on your way to successfully completing the Weekend Without Oil challenge.

Call to Action

On August 21st and 22nd, commit to these 11 actions!

  1. Walk or ride your bike: Avoid using cars and if you must, always try to carpool. Transportation accounts for 40 percent of our petroleum consumption and is easily one of the biggest areas we need to improve upon.
  2. Enjoy the outdoors: Avoid buying new sporting equipment, since oil makes up nearly 25% of rubber. Footballs or basketballs, for example, can last for many years and used equipment is often just as good and will reduce demand for oil needed to make new rubber.
  3. Use reusable bags: Avoid disposable plastic. Plastic bags are a huge waste for very little benefit. Nearly 10 percent of U.S. oil consumption, approximately 2 million barrels a day, is used to make plastic products alone.
  4. Be conscious about what you eat that weekend: You can reduce oil demand by changing your diet to eat less meat, more local foods that require less transportation and organic food, which doesn’t use petro-based fertilizers.
  5. Don’t buy new make-up that weekend: The majority of cosmetics are petroleum-based, including lip gloss, face powder, nail polish, and more. So avoid buying new make-up products this weekend and research the brands when you purchase in the future.
  6. Drink tap water: Avoid beverages bottled in disposable plastic, they make up nearly 1.5 million tons of plastic waste per year, so get a reusable bottle and fill it up.
  7. Make your electronic gadgets last: Avoid buying new electronics. Electronics take a lot of oil to produce and the gadgets you already have can last much longer than the rate at which new ones are released.
  8. Go to the movies or stream them on Hulu: Avoid buying new DVDs/Blu-Rays, as oil is a key ingredient in their production, packaging and shipping.
  9. Skip buying new clothes that weekend: Swap clothes with friends or check out the local vintage store. The less new clothes you buy the less oil is used in the manufacturing process and transportation.
  10. Head to your local library or read online: Avoid using a printer and buying printed material including daily newspapers. Printing doesn’t just waste paper, nearly 100,000 gallons of ink each day is used on daily newspapers alone.
  11. Spread the word! Get 3 friends to sign the pledge and help raise awareness on ways they can help reduce their dependence on oil-related products.

Who’s in?

Photo by: identity chris is

Peak Oil, Sustainability and Economic Collapse – Oil Zenith resources

I’ve just been made aware of this new website which offers a collection of some of the best resources on the web about peak oil, sustainability and economic collapse. I’ve already included some of these links in my resources list, but this website is something else altogether. I think I could get lost in there for days. Check it out –>

Oil Zenith

Thoughts from the Energy Forum

Last week I went to DC to attend an Energy Forum. I was very excited to go, to hopefully meet some contacts and talk with like-minded people. My experience was….interesting.

I think I expected too much. I figured people would have a clue about why we were all really there. Unfortunately most people in attendance were fairly clueless about the realities of our energy situation. To be fair, they were probably there to learn something, but mostly they were attending because their organisation has mandated energy reductions and they wanted to learn about ways to do that. Industry was there with a variety of ‘ways to fix it’, but really I got a sense that they were getting on board because renewable energy was the ‘next big thing’. They were there to make money, not to build a more resilient future. I don’t know why I am surprised.

Only one speaker mentioned Peak Oil, but he obviously completely misunderstands what Peak Oil really means. He got it so wrong. I’m not exactly sure where he was getting his information but he couldn’t even explain the concept of Peak Oil correctly, let alone discuss the risks in a meaningful way. He basically dismissed the idea that there was anything to worry about. I was frustrated that this was the information attendees were receiving. I broached this with a few people during the break and most people I spoke to thought he didn’t know what he was talking about, so perhaps there were more people aware of what’s really going on.

Thankfully, at the end of the second day, one of the speakers hit the nail on the head. He basically said that while it was great that people were implementing energy efficiency programs and renewable energy projects, no-one was really addressing the real risks. He was fairly blunt and provocative which was great.

I guess what surprised me the most is that I now feel like I know more about this stuff than even so-called ‘experts’. It’s good that I’m at a point where I feel confident in the knowledge I have, but now it feels somewhat lonely with not many people to really talk to about all this stuff. Thanks goodness for you all in blogland!!

I’ve come away with pages and pages of notes and some good contacts though. It was certainly a worthwhile experience, but I now have to battle with this feeling that  anything I do to change the system is pointless. I had a few drinks with people on Friday night who asked why I was in DC. I explained that I was there to attend an energy forum and gave them my ‘elevator speech’ about why we need to reduce our energy dependence. You know what they said? “So you’re a greenie now?” Grrrrr!!! People are clueless. They don’t even want to listen. Our civilisation is not going to change in time.

It’s time to start building lifeboats.

Photo by: Abrilon

The Gulf Deepwater Oil Spill

I haven’t written about it until now, becuase it’s been too horrible to think about. I still have no words to articulate how I feel about this massive disaster.

The news out of the Gulf continues to range from grim to grimmer. Recently, it was revealed that the spill has created an undersea plume of oil ten miles long, and that some of the oil has already entered the loop current and is being carried toward Florida. Then the federal government doubled the area of the Gulf that had been closed to fishing. On Friday, the government increased that area again, to forty-eight thousand square miles. President Barack Obama has called the spill a “massive and potentially unprecedented environmental disaster,” a characterization that, if anything, probably understates the case. ~ The New Yorker

I think the pictures say it all.

Here is the feed showing oil gushing from the bottom of the ocean:

http://mfile.akamai.com/97892/live/reflector:46245.asx?bkup=46260

But the following should be an even clearer conclusion from all that has happened, and that is still unfolding: This is what the end of the oil age looks like. The cheap, easy petroleum is gone; from now on, we will pay steadily more and more for what we put in our gas tanks—more not just in dollars, but in lives and health, in a failed foreign policy that spawns foreign wars and military occupations, and in the lost integrity of the biological systems that sustain life on this planet.

The only solution is to do proactively, and sooner, what we will end up doing anyway as a result of resource depletion and economic, environmental, and military ruin: end our dependence on the stuff. Everybody knows we must do this. Even a recent American president (an oil man, it should be noted) admitted that “America is addicted to oil.” Will we let this addiction destroy us, or will we overcome it? Good intentions are not enough. Now is the moment for the President, other elected officials at all levels of government, and ordinary citizens to make this our central priority as a nation. We have hard choices to make, and an enormous amount of work to do. ~ Post Carbon Institute

The Perfect Storm: Six Trends Converging on Collapse

I have an uneasy feeling lately. Everywhere I look I see signs that all is not well. Of course, I’ve been seeing those signs for a couple of years, but things seem to be speeding up and now more and more people appear to be noticing. What interesting times we live in.

There are dark clouds gathering on the horizon. They are the clouds of six hugely troubling global trends, climate change being just one of the six. Individually, each of these trends is a potential civilization buster. Collectively, they are converging to form the perfect storm–a storm of such magnitude that it will dwarf anything that mankind has ever seen. If we are unsuccessful in our attempts to calm this storm, without a doubt it will destroy life as we know it on Planet Earth!

There is a popular saying that “the definition of insanity is doing the same thing over and over again, and expecting a different result.” If we keep doing business in the same way as we have for the past century, each of these six trends will continue their steep rates of decline, collapsing the natural systems that form the foundation for our civilization and the lifeblood of the global economy. Perhaps the current Gulf oil spill is the wake up call that mankind needs to snap us out of our complacency, realize that we are soiling our nest and that continuation of “business as usual” will destroy the world as we know it? Time will tell whether we heed this warning, go back sleep once the oil spill is contained, or simply tire of the endless media coverage, numb ourselves, and set these critical issues to the side.

We already have the technology and the means to turn this dark tide, but we lack the commitment to make the hard choices and sweeping changes that are necessary for shifting the future of our world from its current course of collapse to a new course of sustainability.

The following six trends are converging to form the perfect storm for global destruction, each of which is a potential civilization buster in its own right, if left unchecked:

1. Climate Change

2. Peak Oil

3. Collapse of the World’s Oceans

4. Deforestation

5. The Global Food Crisis

6. Over Population

Read more from Matthew Stein

Photo by: Madeira

Has Peak Oil Hit the Mainstream?

Could this be the first time the Peak Oil discussion has occurred on mainstream media?

Maybe I am being sensitive, but lots of things do seem to be going wrong lately…. slowly, and then all at once.

Let’s take stock: we are on the brink of the Second Great Depression, there is sovereign debt chaos in Europe and considerable social unrest in Greece; on top of all that, it turns out that honeybees are dying in the United States, the volcano in Iceland has started spewing ash again and there is a hole in the bottom of the ocean in the Gulf of Mexico spewing 5000 barrels of oil per day, dooming the local economies that rely on a reasonably healthy coastline for their livelihood.

Is this an epic run of bad luck or am I just being sensitive? If you were to put this stuff in a movie the audience would complain that the plot is wildly implausible.

<Read more at GoldSubject.com>

How Will We Cope When Systems Begin to Fail?

First of all….let me say Wow! Thanks to everyone for the illuminating discussion on my previous post. I’m still digesting all of your comments and haven’t had the chance to add my two cents worth yet because today has been ‘one of those days!’ Prepare for me to vent.

On Friday my work computer came down with a symptom I like to call The Blue Screen of Death. It was taken away to whereabouts unknown and then returned to me today. I eagerly booted it up, keen to recover the ever so important essay I had been working on like a crazy woman for the last few weeks. It was at that point that I discovered that everything is gone….lost….deleted. I could have cried (in fact I might have a little). I’m ok (sort of) losing the everyday work stuff because I can ask people to resend me everything I lost. I am however, devastated to lose the essay I had put long days into researching. All that research is gone and I have to start again.

But that is not what I want to talk about today. I want to talk about my reaction to losing EVERYTHING on my computer. After a couple of glasses of wine and a few hours of hindsight, I’m prepared to dissect it.

So….. I lost all the data on my computer. Nobody died. I didn’t lose a limb. A piece of technology failed me…..That is all. So why did I react like my world was coming to an end?

This got me to thinking.

How would we react if all the bank’s computers died? How would we get our money? How would we know how much money we had? Where does our ‘wealth’ go?

How would we react if we had rolling electricity blackouts in our district? How could we pump gas (petrol)? How would water get pumped to our house? How would our effluent get pumped away and treated? How would we cook our food?

How would we react if a foreign country denied us access to oil? How would we get food from the supermarket if the trucks don’t come? How do we get to work to earn our money if we can’t fill the tanks of our cars?

It got me to thinking….We are so reliant on ‘the system’. The system is so reliant on technology. Technology is so reliant on energy.

It got me to thinking….How will we (as a society) cope when systems begin to fail?

Photo by: StarrGazr

A Farm for the Future

I thought I was getting better, but alas I was fooled. I’m still down with this illness, which seems to have progressed to a rotten headache and deep lethargy. I can’t find the energy to write any posts so instead, here is a video I found today at the Simple, Green, Frugal Co-op. Hope you enjoy it as much as I did.

A Farm for the Future

This BBC show features Rebecca Hosking returning to her family farm in Devon. After the petrol price shocks of 2008, she confronts the challenge of reducing the farm’s dependence on oil in order to keep it running and viable in a future of increasingly scarce energy. She explores the history of British agriculture and considers what other British farms have done to wean themselves off fossil fuels.