by Saint Bif
Part I – Monday
Jim’s Monday post was obviously still on his mind tonight as he, Dennis Hayes, Randy Udall and Richard Brenne took hits on a tequila bottle and squared off in philosophical debate that was supposed to address our post-peak future. Brenne providing much needed levity and picked on Jim repeatedly, which Jim and the crowd enjoyed.
From my notes but in no particular order, not that there really was one. Jim made his Millard Filmore Whigs and Abe Lincoln-moment parallel, and he wanted to get that off his chest, which was alright. Politics had been somewhat down-played until then but Jim went big on a “the party that wrecked America” rant (there was some vigorous applause, a few protests), but he also pushed back hard on the idealists in the crowd and who have graced the podium who keep yearning for a “lock arms and all work together” solution. Jim said we’ll never get to the kumbaya moment, it isn’t going to happen.
Jim talked about how in future people will necessarily create a new reality, it could be very different, empiricism and logic as we may know it will be out the window, and he tried to get this into WMBH. (beats me, this unfortunately may be about the fat lady).
It was Brenne, as moderator, with the best lines, “the rat tail is the gateway to full mullet-hood”, and also Jim as bringing his experience of having been through “peak hair” already. And finally, regarding the airline industry, we’ll never be able to get the passengers to shovel coal so its not going to happen, however hypersonic works, but only of you fly non-stop around the whole world. Jim, saying techno triumphalism has run its course, transition will not be orderly, and Brenne saying Heinburg thinks we’ll see something like WMBH except maybe 15 minutes early than what Jim says. On and on it went.
Hayes concerned more about abundance of coal and uranium rather than scarcity (get it?) (note: around then I spilled beer on my notebook and after mopping it up scribbled “woah”. It was in fact a double woah). Randy Udall also trying to reconcile that it turns out orangutans are more intelligent than chimps and so maybe the higherl intelligence is at the other end of the primate lineage (score one for dave), and afterall, if you keep going with that: the trees have all along equipped themselves with very efficient leafy solar panels. (I know. Me too).
Udall: maybe its no coincidence that peak environmental achievement happened to coincide with peak oil discovery. Crowd fidgets and imagines a permanently trashed world rather than perma-utopia. Yes but there may have to be certain compromises/tradoffs on environment. Grumble.
The tequila did take firm hold eventually, as evidenced when Udall says he’s not convinced water is a limiting factor on world population going to 9 billion. Huge groans from the bard on that one.
Someone yelled something about psychopathy (that’s what my notes indicate anyway, though I don’t know context, or who yelled it at who).
PO conferences are not the best place to meet women, Jim quipped.
All the giants of PO here except Kris Kan. Too bad. All the main actors and supporting cast are friendly and approachable.
OK sorry, interesting night, but on serious side, I have some good info, and I’ll work up some notes and post some highlights.
Part II – Tuesday
A diverse crowd at ASPO-USA meeting as you might suspect, and presentations running the gamut as far as content, and unfortunately, quality, especially in addressing transportation piece. I think these presentations will at some point be available on their web site so I won’t attempt to reconstruct it all, but will offer a few highlights and comments where I was interested and took notes. I did not see all of the talks but I was in most, and here are the ones I thought were most interesting:
Kjell Aleklett -President ASPO International: What’s going on in Africa right now (oil and mineral extraction) is the biggest robbery in history and no one is talking about it.
Matt Simmons – talked about how big banks used to use an 8:1 limit on investment risk and our geniuses on Wall Street have apparently been going at more than 400:1. Not sure how he gets that number but the gasp from the audience was impressive.
He said the gasoline purchasing behavior in wake of Ike is a good sample of what can happen even when the disruption is relatively minor compared to what we could see in future. The urge of millions to “top off” the gas tank can crush our usable gasoline stocks pretty quickly, creating snowball conditions that only make matters worse.
Why expect a political leader to give the public the straight scoop when this will only cause panic and bad behavior. Unless you have a solution or plan to go with the bad news, don’t upset the masses. Presently there is no plan.
We don’t know our actual usable gasoline stocks, its all based on sampling of primary supplies, then the numbers are “grossed up” and seat of the pants estimates made for secondary and tertiary contributions.
He talked the usual warning on lack of rigs; lack of knowledge, talent and skills; lack of college grooming and production of engineering and scientific talent; no young Americans going into these areas of education/skill.
Rusting infrastructure. Expect massive effort to upgrade this at some point. His usual pitch on this topic.
Need to be brutally honest about EROEI for developing Barnett shale. Maybe 1:1!?
IEA report coming out Niov 15 may be brutally honest. This will shake up and upset some people.
Back in the 70s the way we rationed gasoline was odd-even license plates, but that was in the days we had gas station attendants. Nobody is printing ration coupons, better do something.
He said the majors were in a state of permanent liquidation.
Jeff Rubin, Chief economist, CIBC World Markets: Triple digit oil prices matter with trade.
Globalization = wage arbitrage, he said.
But transport cost is trumping that now. It’s no longer a matter of cheap labor markets when transport cost gets super high.
$20 bbl oil = incidental cost
$100 bbl = 40% increase in transport cost.
$200 bbl = 80% increase in transport cost
It’s no longer where cheap labor is but where factory is in relation to raw materials and market. Transport cost has essentially become a tariff rate. $150/bbl quadruple tariff rate, and $200/bbl quintuple tariff rate.
In 1970s trade was less emphasis and domestic markets huge emphasis, trade was mostly with neighboring countries. We’re going back to that.
In 2000, a 40ft shipping container shipping cost: $3K
2008 it was $9K
At $200/bbl it’s 5x what we were ($15K?)
Iron ore from Brazil shipped to China and rolled steel manufactured and sent to U.S. = $90/ton. Transport cost has trumped labor cost here as steel manufacturing has increased 10% in U.S. and Chinese imports are dropping. Important because for years the trend was opposite. Energy cost increase sole reason for the shift.
Paul Gipe – Windworks. For grins he walked through a scenario for replacing all current FF consumption in US and Canada with wind power. What would the power requirement be?
2,500,000 MW total replacement of FF
800,000 MW for cars and light trucks (based on 1/3 kWh /km)
200,000 MW heavy trucks
For reference, this year we’ll add about 8,000 MW in wind turbines he said. Last year was 5600 MW.
Michael Webber – U of Texas. A few items he mentioned on coal, coal to liquids (CTL) and biofuels.
Coal reserve estimates/methods have not been revisited since 1974.
A comment on fusion – “We’ve been within 50 years of having fusion for 60 years.”
Body slam on Brazil oil and biofuels – “Brazil is the next super power and always will be.”
Water requirements to fuel production ratio (vol.):
CTL is 7:1
Conventional coal 1:2.5
Irrigated biofuels 1,000:1
“Alternatives are so great we keep coming back to coal”, he said. (Scattered sounds of evil laughter in the room mixed with a few boos and hisses). Expects a 70% increase in use of coal in US by 2030. Already 2/3 of it transported by rail and it’s a bottleneck. Would need to double much of the trackage in US.
USAF is worlds biggest single customer of liquid fuel. By 2016 they want at least half of their annual 3.3 billion gallons jet fuel to come from domestic sources. CTL is the preferred way to do it (compared to all the other ways I guess?). Problem is recent legislation (Sec526) prohibits alt fuels that are GHG intensive. Woops, mulligan please.