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THE END OF THE AGE OF OIL
By David Goodstein
Published by CalTech News, California Institute of Technology Vol. 38, No.2, 2004
This article is adapted from a talk that Caltech
vice provost and professor of physics and applied physics David
Goodstein presented
at an April 29 program of the Institute support group, the Caltech
Associates. Goodstein’s new book, Out
of Gas: The End of the Age of Oil, was published in February
by W. W. Norton.
In the 1950s, it was not Saudi
Arabia but the United States that was the world’s greatest
producer of oil. Much of our military and industrial might grew
out of our giant oil industry, and most
people in the oil business thought that this bonanza would
go on forever. But there was one gentleman who knew better. He
was an oil
exploration geologist named Marion King Hubbert.
In about 1950, Hubbert realized
that the trajectory of oil discovery in the continental United
States was going to be
a classic bell-shaped
curve, for the decades from 1910 to 1970, in billions of
barrels per year (see figure 1, below). He also saw that there
would
be a second bell-shaped curve that would represent production,
or consumption,
or extraction. The oil industry likes to call it “production,” but
the industry doesn’t really produce any oil at all. It does,
however, reflect the rate at which we use the oil up. Perhaps you
could call it supply.
Hubbert realized that using what he knew in 1950 about the
history of discoveries, along with what was already known
about consumption,
and a little mathematics, he should be able to predict that
second bell-shaped curve. And so he did (see figure 2, below).
The red,
bell-shaped curve is the kind of curve he predicted. The
black points are the actual historical data, and the uppermost
point
represents
what has come to be known as Hubbert’s Peak. Obviously, he
was doing something right.
Before we leave that curve, though, I want to point out that a sudden
jump of 300–400 billion barrels of oil in OPEC (the
Organization of the Petroleum Exporting Countries) reserves
occurs in the late
1980s (see figure 3, left-hand graph, above). But there were
no significant discoveries of oil in OPEC countries during
that period. What happened
instead is that OPEC changed its quota for how much each
country could pump on the basis of what it claimed in reserves,
and politicians
discovered 400 billion barrels of oil without ever drilling
a hole in the ground! This helps us to understand how undependable
these
numbers are for worldwide proven oil reserves.
As you can see, the curve that
traces the historic record of oil discovery peaks around 1960.
In other words, Hubbert’s peak
for oil discovery came and went 40 years ago.
The curve for oil usage, as
you can see, is a rising curve and will become a bell-shaped curve
eventually. Note that
for the last quarter
century, we’ve been using oil faster than we have
been discovering it. World reserves should have decreased
during that time by about
200 billion barrels. Instead, as we’ve seen, they’ve
increased by 400 billion barrels. In any case, it should
be possible, given this much information, to make a prediction
similar to the
one that Hubbert made for the continental United States
for worldwide oil production.
One such estimate was published
in 1998 in Scientific American. It predicts that we
will have a worldwide maximum
in oil
production just about now—around the middle of
the decade 2000–2010.
What will happen when we reach that peak we don’t
really know. But we had a foretaste in 1973 and ’79
when the OPEC countries took advantage of the supply
shortage
in the United States and shut
down the valve a bit. What happened, as you may recall,
is that we had instant panic and despair for the future
of our way of life,
and mile-long lines at gas stations.
We don’t know what’s
going to happen at the next peak, but we do know that those past
peaks were artificial and temporary.
The next one will not be artificial and it will not
be temporary.
However, we have to use caution
in evaluating these types of predictions. One crucial quantity
that goes
into making
such
an estimate is knowing
how much oil Mother Nature originally made for us—that is,
how much oil was in the ground before we ever started pumping it.
The Scientific American estimate used 1.8 trillion barrels of oil
as the baseline number. Today it looks like 2.1–2.2 trillion
barrels might be more accurate. That number—the total amount
of oil that ever existed—tends to increase
with time for a variety of reasons.
First, new technology and new
discoveries have exactly the same effect—they
both make more oil available. Secondly, as oil becomes scarcer and
the price goes up, more oil becomes available at the increased price,
because you can invest more capital into pulling it out of the ground.
And finally, these estimates depend to some extent on those proven
reserve numbers and, as we’ve already seen,
those numbers are not very reliable. Nevertheless,
the central idea of the Hubbert
Curve is certainly correct: the supply of any natural
resource invariably rises from zero to a maximum
point, and then it falls forever. Oil
will behave in the same way.
In 1997, Kenneth Deffeyes, a
former Shell Oil geologist who’s
now an emeritus professor of geosciences at Princeton, published
a book he entitled Hubbert’s Peak—The
Impending World Oil Shortage. In it, Deffeyes said he knew that Hubbert had been
right and that the peak for domestic production had been reached
when he saw this sentence in 1971 in the San
Francisco Chronicle: “The
Texas Railroad Commission announced a 100% allowable for next month.”
To demystify that sentence,
the Texas Railroad Commission was the quaintly named cartel that
controlled the
U.S. oil industry
by making
strategic use of the excess capacity for pumping
in Texas. When the commission said, “100% allowable for next month,” it
meant that there was no longer any excess capacity. They were pumping
flat-out, and therefore Hubbert’s Peak
had been reached.
Ever since reading this,
I’ve thought that the signal that
the worldwide peak had been reached would
be when we found out that Saudi Arabian production
had peaked. For the last few decades, the
Saudis have been using excess pumping capacity
to manipulate the
world oil market in exactly the same way
the Texans once did.
Well, on February 24
of this year, a story
appeared on the front page of the New
York Times entitled “Forecast of Rising Oil
Demand Challenges Tired Saudi Fields.” Among other things,
the article said that Saudi Arabia’s oil fields are in decline,
prompting industry and government officials to raise serious questions
about whether the kingdom will be able to satisfy the world’s
thirst for oil in the coming years.
This is a New York Times story,
so it’s very long, as many
Times stories are, and it’s written in a style in which each
successive paragraph is contradicted by the next paragraph. This
is called “balanced reporting.” Sure enough, much farther
down in the article, we find these words: “Some economists
are optimistic that if oil prices rise high enough, advanced recovery
techniques will be applied, averting supply problems.” But
here comes the contradiction in the next paragraph, “But, privately,
some Saudi oil officials are less sanguine.”
I don’t know whether we will look back years from now and say
that this was the beginning of the end of the age of oil. We’re
much too close to it to tell, and our figures are, overall, much
too uncertain. But, to those people who are aware of the Hubbert’s
Peak predictions, as the writer of
this article apparently was not, this
was a chilling report.
Economists tell us that there
can never be a gap between supply and demand
because the
process
is
regulated
by price. That’s never
been true in the case of oil, because
it has always been controlled by
cartels, first in Texas and later
by OPEC. However, once the peak
occurs, OPEC will lose control of
the situation, and the price mechanism
will kick in with a vengeance. But
the supply can keep up with the price
only if there is something to supply.
I’m sometimes asked, what about replenishing our oil reserves
through deep-ocean exploration? I’m already factoring in close-to-shore
oil production, but the deep oceans are essentially unexplored and,
it’s true, we don’t know whether there’s
any oil out there. Over the last
hundreds of millions of years,
oil typically
has been manufactured in places
that are rich in life, which deep
oceans are not. But the landmasses
have moved around over geologic
time, so there may be deep-ocean
oil reserves.
Even so, deep oceans
are technically
extremely difficult places to
drill for oil. That
leaves us with only
two remaining reservoirs—the
South China Sea, which currently has seven countries claiming mineral
rights to it; and Siberia, which has very bad access problems. And
those resources, of course, are finite also. So let’s
see what else there is to use,
aside from oil.
The word “oil” covers more than just the conventional
light crude that we’ve been pumping up to now. It also covers
heavy oil, oil sands, and tar sands. Heavy oil is essentially what’s
left behind in the field after you pump the light crude away. And,
of course, if you put more money in—that’s the price
mechanism—you can usually squeeze a little more oil out of
any field. But it’s both
more costly and more time-consuming
to get that oil out. And the
more you pump out, the heavier
it gets.
Natural gas could
be a very
good substitute for oil.
Cars that
are not very different
from those
we drive
today can
run on
compressed
natural gas, and it’s a particularly clean-burning fuel. But
if we turn to natural gas in a major way to replace diminishing supplies
of oil, it will only be a temporary solution. The Hubbert Peak for
natural gas is only a decade or so behind Hubbert’s
Peak for oil.
Oil was created when so-called
source rock, full of organic
inclusions, sank deep within
the earth.
The
inside of
the earth is heated by
natural radioactivity,
and the deeper
you go, the hotter it gets.
This source rock
sank just
deep
enough into
the heated
interior for
the organic matter to get
cooked into oil. Rock that
sank deeper
got overcooked
and
became natural
gas.
Rock that
sank to a
more shallow level became
shale oil, which is essentially
unborn
oil that
can
be made into a fuel by
strip-mining, crushing, and heating the
rocks until you generate
a usable liquid.
People
who have invested many
millions of dollars into
trying to exploit this
resource have
come to
the conclusion
that it
will probably
always be energy-negative,
meaning that you will always
have to put more energy
into acquiring
and
processing it than
you will
ever get out
of it.
Methane hydrate is a solid
that looks like ice,
but that burns
if you ignite
it. It
consists of methane
trapped
in a sort
of cage of
water molecules and it
gets created when methane
comes
into contact
with water
under very high
pressure at
very low temperatures
close
to the freezing point
of water. Nobody has any
idea of where all it
is, how much there is, whether
it
can be
mined, or
how it could
be used—all we
know is that this stuff
exists.
Finally, there
is coal.
We are told that there
is enough
coal
in the
ground for
hundreds, maybe even
thousands
of years,
at the present
rate of use. The fact
that these estimates
range over
a factor
of ten tells you
immediately that
nobody has
the
foggiest
notion of
how much coal is actually
available. But even
those projections might
be considered reliable,
compared
to the second
part of that optimistic
sentence: “at the
present rate of use”!
We’ll get
to that in a moment.
The largest coal deposits
are in the United States,
and China
and
Russia
have very
large reserves
as well. Coal
can be
liquefied and
made into a substitute
for oil. That was done
in Nazi
Germany
during World
War II,
and in
South Africa under
apartheid.
That alone should
tell you that you have
to be fairly desperate
to
do it, but it can be
done.
But, coal is a dirty,
dirty fuel. It often
comes with
nasty impurities,
including mercury,
arsenic, and sulfur.
The
mercury that accumulates
in the bodies of
tuna or swordfish—and which has led to FDA
warnings to limit our consumption of these fish—originates
in coal-fired power plants in the United States. We use now about
twice as much energy from oil as we do from coal, so if you wanted
to mine enough coal to replace the missing oil, you’d have
to mine it at a much higher rate, not only to replace the oil, but
also because the conversion process to oil is extremely inefficient.
You’d have to mine it at levels at least five times beyond
those we mine now—a
coal-mining industry
on an absolutely
unimaginable scale.
And even that doesn’t take into account the world’s increasing
population, or the fact that nations like China and India want to
have a higher standard of living, which means burning more energy.
Finally, it doesn’t take into account the Hubbert’s Peak
effect, which is just as valid for coal as it is for oil. Long before
we have mined the last ton, we will have started to deplete our ability
to get the stuff out of the ground. So, it’s a very good bet
that the governing “rate of use” number
I mentioned earlier
is not hundreds
or thousands of
years, and that
no more than one-tenth
of that timeframe
represents a realistic
estimate.
What
all this suggests
is that if we
accept the economists’ solution
and just let
the marketplace do its thing as we make use of all the fossil fuel
we can, we’ll start running out of all fossil fuels
by the end of
this century.
So, what does
the future
hold? Well,
for one
thing, there
will be an
oil crisis very soon.
Whether
that means
it has already
begun
or won’t happen until later in this decade or sometime in the
next decade, I don’t know. In my view, the numbers are not
dependable enough for us to say. However, while the difference between
those estimates may be very important to us, it’s of no importance
at all on the timescale of human history. Either we, our children,
or perhaps our grandchildren, are in for some very, very bad times.
If we turn to all the other fossil fuels and burn them up as fast
as we can, they will all probably start to run out by the end of
the 21st century. Assuming that our planet remains habitable after
such a vast consumption binge, we will have to invent a way to live
without fossil fuels. (See sidebar “Too
Hot To Handle?”)
How about hydrogen?
Both President
Bush and
California governor
Schwarzenegger
have
publicly
embraced hydrogen as
a solution
to our
fuel problems.
But there
are only
two commercially
viable ways
of making
hydrogen. One is to make
it
out of methane,
which is
a fossil
fuel. The other is
to use fossil
fuel to generate
the electricity
that you
need to
electrolyze
water
and
get hydrogen.
The economics
of
doing that
are such
that you end up
using the
equivalent of six
gallons of
gasoline
to make enough
hydrogen
to replace
one gallon
of
gasoline.
So this
solution
is not a winner
in the
short run.
In the long
run, if the
problem of
harnessing
thermonuclear
fusion can
be solved
and we
have
more power
than we
know what
to do with,
you could
use that
form of energy to
make hydrogen
for mobile
fuel. I’ll
get to that
a little
later.
There
is
also wind
power,
which many
now see
as a viable
energy
alternative. And
it is,
but only
to
a limited
extent.
In regions like
northern
Europe,
where fossil fuels
are very
expensive
and
the wind
is really
strong,
wind power will
someday
come to rival
hydroelectric
power
as a source
of
energy.
But there are
relatively
few
places
on earth where
the wind
blows
strongly
and steadily
enough
for it
to be a dependable
energy
source,
and people
don’t really like wind
farms—they’re ugly and they’re noisy. Wind power
will always be a part of the solution. But it’s not a magic
bullet. It’s
not going
to save
us.
In
recent
years,
the debate
over
nuclear power
has revived,
with
proponents
maintaining
that
we can
find
environmentally sound and
politically
acceptable
ways
to deal with
the
waste
and security
hazards.
But even
assuming
that
to be true,
the potential
is limited.
To
produce
enough
nuclear
power
to equal the
power
we currently
get from
fossil
fuels,
you would
have
to build
10,000
of the
largest
possible
nuclear
power
plants. That’s a huge, probably nonviable initiative,
and at
that burn rate, our known reserves of uranium would last only for
10 or 20 years.
As things
stand
today,
the
only
possible
substitutes
for
our
fossil-fuel dependency
are
light from
the
sun and
nuclear
energy.
Developing
a way
of
running a civilization
like
ours
on
those
resources
is
an enormous
challenge.
A
great
deal
of
it is
social
and
political—we’re
in
the
midst
of
a presidential
election,
and
have
you
heard
either
party
say
a word
about
this
extremely
important
subject?
But
there
are
also
huge
technical
problems
to
be
solved.
So,
you
might
well
ask,
what
can
Caltech
do
to
help?
The
ultimate
solution
to
our
energy
problem
would
be
to
master
the
power
of
controlled
thermonuclear
fusion,
which
we’ve
been
talking
about
doing
for
more
than
half
a
century.
The
solution
has
been
25
years
away
for
the
past
50
years,
and
it
is
still
25
years
away.
Beyond
those
sobering
statistics,
there
are
at
least
five
or
six
schemes
for
harnessing
fusion
energy
that
I
know
of.
One
of
them,
called
the
spheromak,
is
studied
here
at
Caltech
in
an
experimental
program
run
by
Professor
of
Applied
Physics
Paul
Bellan
and
his
research
group.
In
the spheromak,
electric currents
flowing in
a hot
ionized gas—otherwise
known
as
a
plasma-—interact
with magnetic
fields embedded
in the
plasma. As
these fields
and currents
push the
plasma around,
new fields
and
currents are
created. There’s a sort of self-organizing
interaction occurring. You can see in this sequence of snapshots
below, starting from the top, that the plasma is organizing itself
into a jet and then a kink develops in the jet. This is something
that happens all by itself, and it’s not something that happens
only occasionally—the gas always self-organizes like that.
After the kink develops, it breaks away from the body of the jet
as a doughnut. If you can find a way to maintain that doughnut and
keep it going—that is to pump in enough energy to keep it from
decaying—the doughnut has the perfect geometry required for
containing a hot plasma undergoing thermonuclear fusion. Fusion
research at
Caltech.
But
attaining this
objective is
far off.
The existing
apparatus is
much too
small to
reach the
hundred million
degree temperatures
needed to
generate power.
The Bellan
team is
studying the
fundamental physics
of the
self-organizing process
in the
hope it
can be
used to
create and
sustain the
desired fusion
plasma confinement
geometry in
a reliable,
controlled manner.
There’s another group at Caltech whose efforts are aimed largely
at the other alternative—solar
energy. Their program is called
Power the Planet: Caltech
Center for Sustainable Energy
Research. Members include applied
physicist Harry Atwater, chemists
Harry Gray,
Nathan Lewis, and Jonas Peters,
and materials scientist Sossina
Haile.
Furthermore,
our former
provost Steve
Koonin recently
stepped down
from the
provostship and
took a
leave of
absence from
the Caltech
physics faculty
to become
chief scientist
at BP.
BP, formerly
British Petroleum,
is one
of the
largest energy
companies in
the world,
and so
he now
has one
of the
most important
energy positions
in the
world.
The
fact that
these and
similar scientific
and technical
efforts are
under way
at Caltech
and elsewhere
are encouraging,
but they
are not
enough. What
we really
need is
leadership with
the courage
and vision
to talk
to us
as John
F. Kennedy
did in
1960, when
he pledged
to put
a man
on the
moon by
the end
of the
decade. It’s
the same kind of problem. We understand the basic underlying
scientific principles, but we have huge technical problems to
overcome.
If
our leaders
were to
say to
the scientific
and technical
community, “We
will give you the resources, and you—right now, even before
it becomes imperative—will find a way to kick the fossil-fuel
habit,” I think that it could be done. But we have to have
the political leadership to make it work.
