Shell Makes Another Cut in Reserves; Profit Jumps

[struggle4progress]

By HEATHER TIMMONS
Published: February 4, 2005

ONDON, Feb. 3 - The Royal Dutch/Shell Group reduced its proven oil and gas reserves by an additional 10 percent on Thursday, rattling investors yet again and increasing speculation that the company will ultimately have to buy a better-performing rival to compete with peers like Exxon Mobil and BP.

The cut in reserves, Shell's fifth in just more than a year, came as the company reported record profits, buoyed by high oil prices.

Shell reported fourth-quarter net income of $4.48 billion, more than double the $1.9 billion it earned in the quarter a year earlier. <snip>

Shell has been floundering since it first cut its proven reserve levels by 20 percent last January, prompting an investigation by the Securities and Exchange Commission. <snip>

http://www.nytimes.com/2005/02/04/business/worldbusiness/04shell.html

[mhr]

1. 34 Years Of Oil Left In The World - This Matters Little

What we face is the wholesale change in our lives in very short order.

[midnight armadillo]

2. Reference?

What's your reference on the 34 year claim?

[mhr]

3. This Will Make It Simple For You

Let's examine the facts as presently known.

Estimated World Oil Reserves (Consensus Estimate By Geologists)
1,000,000,000,000 Barrels

Current World Oil Demand
80,000,000 Barrels per Day

1,000,000,000,000

Divided by

80,000,000

Equals - 12,500 Days

12,500 Days

Divided by

365 Days per Year

Equals - 34 Years

Any Questions?

[midnight armadillo]

4. Thank you for making it simple

After all, I do best with small words and basic arithmetic.

Unfortunately, I have to disagree with your figure. You don't appear to include the tar sands of Canada and elsewhere, which are a source of oil (at higher cost and energy expended, of course). You don't include effects of supply and demand in your calculation, wherein the growing prices for an ever-scarcer resource for a change in consumption habits, or the impact of new technologies for fuels and efficiencies. So, picking 2039 years as the doomsday,no-oil date is not an accurate prediction.

I think it's safe to conclude that there will be a true crisis in oil supplies brought about by demand and constrained supply in the next 50 years or so if we stay on the current course (particularly the US, China & India). The world has switched fuel technologies in the past...note the utter lack of whale oil in use in your everyday life.

[mhr]

5. You Miss The Point - At Steady States ( Which People Can Understand)

We Are out of conventional oil (easy oil) in 34 years.

Tar sand are never expected to be a large substitute for conventional oil because the price differential to mine is so great.

If the demand increases, the time to depletion gets shorter.

With growing population there is no reason to assume that demand will decline.

If we assume a 100% error in reserves, we still have only 68 years of remaining oil.

All of that is a distraction n the minds of most people. Keep it simple and they will understand that we have a problem.