Reply #112: What's really happening here?

[Dogmudgeon]

The article -- which I read in full -- contradicts nearly every report on petroleum resources that has appeared in the last few decades.

Saudi Arabian oil -- mainly the Ghawar oil field -- keeps its EROEI low by pumping massive amounts of water into the field. This may be a good production strategy, but it is impractical for most other oil fields. And when the Ghawar oil "runs out", it will really run out.

Second, new discoveries of oil have bottomed out. Huber and Mills (the authors of the book) don't seem to take that into consideration. Also, the assertion that oil is "essentially" limitless just ain't so. The Earth is big, but "big" is still finite. Their optimistic view about using bacteria to recover oil from shale/tar/sand matrices is much too rosy. A lot of different bacilli can "eat" oil, since oil is organic hydrocarbons. But I don't know of any species of bacteria that can selectively recover different fractions of oil (not that it would be absolutely impossible).

Their discussion of financial factors keeping oil prices high is well-reasoned, but their statements of "fact" regarding the geology itself demand better evidence and arguments. $50/barrel oil with a $15 "lift cost" just does not make economic sense. If cracking the oil out of Athabascan sand and gravel is as cheap as Huber and Mills claim, it would be a no-brainer for Canada to open the area to development. But the projects currently running are all experimental. What does Canada owe to the oil companies, let alone the House of Saud? As far as I know, nothing.

The book should be subject to wide scrutiny. If Huber and Mills are blowing smoke, they ought to be publically discredited; but if they are telling the truth, someone is doing a lot of teradollar lying. With such divergences in industry and petrologic data, someone is certainly trying to scam us. Either way, the oil crisis, whatever its outcome, may be the biggest swindle of all time.

--p!