Peak Oil 101

The following is a brief review of oil industry performance over the last 20 years or so. I´m writing this post because I sense there´s a bit of confusion and too much optimism regarding the amount of crude oil and condensate we have available to burn in the future.

I should clarify that crude oil and condensate are those fluids we extract from oil and gas wells, and we introduce in a refinery. These wells also produce natural gas liquids (NGL), such as ethane, propane, and butane. I´ve left these out of the picture because they are mostly used as chemical feedstocks or are marketed as LPG, where they compete with natural gas (methane). 

To show you my concern over this issue, I prepared a very complex spreadsheet, in which I introduced historical crude oil and condensate (C&C) data for all nations. After rumiating a while and pondering this data I decided to split these countries into several groups, which I called 

High Peformers - the top 18 oil industry gorillas, such as Saudi Arabia, Russia, the USA, Canada, Venezuela, Brazil, and so on. These 18 countries produced 61 out of 78 million barrels per day of C&C produced in the world in 2014. 

Please note I´m saying the world produced 78 million barrels, and not the higher volumes reported by agencies such as OPEC because I don´t add NGLs, syncrudes, refinery volume gains, and biofuels to the mix. I think adding those non C&C products tends to cloud our vision when it comes to what´s coming out of the ground. 

Medium - The next 28 countries. These include Azerbaijan, India, Equatorial Guinea, Gabon, Ecuador, Argentina, etc. The analysis you see below focuses on these countries. They produced 8.5 million barrels per day in 2014. 

Note that I´ve lived, worked, or consulted in most of these, so I´m fairly familiar with what goes on. 

Low - The next 28 countries. These range from Tunisia to Guatemala. They don´t really mean much. 

Marginal - 22 weaklings. They produce less than a single brand new deep water well, about 50 thousand barrels per day. 

Conflict and New Source Group - 5 countries which have production rates impacted by politics, conflicts, sanctions, etc, (Libya, Iraq, Iran, Syria, Sudan & South Sudan),  plus a line for new emerging production areas (this would include Uganda, the Falklands, Deep Water Guayana, etc). They produced 7.3 million barrels of C&C per day in 2014, but I project they´ll produce over 10 million barrels of oil per day by 2030, if their political issues and economics have positive outcomes. 

Now I´m going to show you the production curve for the Medium group. This group is interesting because they are mostly  established producers, with steadily declining production. They have been unable to reverse this decline even in a high price environment such as we saw in the 2001 to 2014 period. 


Mid April Venezuela: how to fight the Maduro regime

In recent weeks we have seen Venezuela continue its descent into hell. The Maduro Mafia is losing international support, but it continues to use the Supreme Court and the repression machine to stay on top. 

The IMF predicts inflation should increase beyond 1000 % in 2017, GDP is falling, food and medicine shortages continue. The same applies to the ongoing crime wave, which is so bad now we see public lynchings as people take the law in their own hands.  

Victim of lynching lies on the street 

There's no water, the electric power grid suffers continuous cuts, the main power source for the country is about to collapse, and Maduro keeps signing deals with the Castro dictatorship and keeps sending oil and  dollars to Cuba. 

I don't think anything will happen unless the National Assembly turns the screws tighter. The best way they can do so is to continue legislating to have the Supreme Court shoot them down with spurious decisions, plus they can use their tenuous control over the purse by issuing resolutions and or laws which warn foreign parties not to enter into agreements or make loans with a government which refuses constitutional controls and is known to be extremely corrupt. 


Former NBA star Chris Mullin joins Mets baseball team

It has now been 15  years since NBA star Chris Mullin  last played in a professional basketball game, but his playing days are still not over. The youthful looking 50-year-old Mullin, bored with his job as head basketball coach, went 12-for-27 (.444) in seven simulated games with the New York Mets, and next week he's heading to Florida to start his professional baseball  playing career. 

Mullin during his surprising baseball tryout
According to his agent (Chris Ford, who used to represent Dikembe Mutombo and other NBA stars), Mullin has signed with the New York Mets for $2 million plus performance bonuses. 
When asked what led to this surprising career change, Ford explained "Chris has been playing with his team to stay in shape, and developed a supernatural ability to catch anything thrown his way and return it at high speed. This was noticed by a Mets scout visiting the Saint John's campus, and eventually led to a secret tryout, where Chris showed he has incredible lateral  range at second base, which coupled with his height and leaping ability, plus his Pete Rose batting and running skills,  make him a cinch to become the Mets' starting second baseman and possibly an all Star".