“Peak Oil” = “Peak Idiocy” – #10 in a series
The ‘Peak Idiocy’ comment is at least three years old. Let’s visited a couple of dusty articles.
Mike Munger brings the concept into play in his December 5, 2009 post Peak Idiocy where he says:
Of all the idiotic things that people believe, the whole “peak oil” thing has to be right up there. It is literally impossible for us to run out of oil. We have never run out of anything, and we never will.
If we did start to use up the oil we have…(though, counting shale oil, we still haven’t used even 10% of the total KNOWN reserves on earth, and there are lots of places we haven’t looked)…but suppose we were on our way to using it up. Three things would happen.
Some other day we can expand his list of three reasons why peak oil will never happen. I’ll throw out a few ideas at the end of this post. Topping the list would be human ingenuity.
Mark Perry picked up on that idea the next day in his December 6, 2009 post Econ 101: Why Peak Oil is Peak Idiocy.
On November 13, 2010, Mark Perry explained the dramatic change created by fracking in Successful Bakken Drilling Technology May Start to Go Global: That’s Why “Peak Oil” is “Peak Idiocy”.
He explains the Bakken field wasn’t expected to produce much oil
because the dense, nonporous rock in the Bakken region makes extraction extremely difficult and costly.
There’s lots of oil there, an estimated 4.3 billion barrels, but the thought was we could never get to it. Too hard to reach. Too difficult. Too expensive. Sorry. Not gonna’ happen.
Then horizontal drilling and fracking arrived on the scene.
Consider the North Dakota statewide December 2011 production stats of 535,035 barrels per day (bopd) and July 2012 production of 674,066 bopd as you read this ancient history from 22 months ago:
the original estimates were for peak Bakken production of only 220,000 to 280,000 barrels per day, but daily production went above 280,000 in April this year by September had reached 341,384 barrels. Oil production is expected to hit 400,000 barrels per day by next year, and remain at that level or higher for the next 10-15 years.
Bakken only production was 470k bopd in December 2011 and 609k bopd in July 2012.
Actual Bakken production in December 2011 (470k) blew out that estimate of one year earlier (400k). Today there is something in the range of 190 or 200 rigs going full steam ahead.
Way back in 2010, other companies were noticing the success with fracking and pondering the impact elsewhere:
“Know-how gained from North Dakota’s once-perplexing Bakken shale formation is being used to exploit other onerous oil plays across the globe. Oil companies and countries a world away have taken notice of North Dakota’s success, said Lynn Helms, director of the state Department of Mineral Resources.
Companies say they are aiming to apply technology learned from the Bakken to geologically similar shales in China, France, Poland, Canada and in some U.S. states, including Wyoming, Utah and Colorado.
That is why Eagle Ford is a booming area, surpassing Bakken in rigs and rivaling Bakken in production.
Look at the radical change that took place in 2010. Again from Dr. Perry:
New, advanced techniques for drilling oil have revolutionized the domestic oil industry in North Dakota in ways that couldn’t have even been predicted just a few years ago, and will likely also open up new oil production in other parts of the world in the near future (like the Alberta Bakken in Canada) that also would have been unimaginable before this year.
Those “advanced techniques”? Horizontal drilling and hydraulic fracturing.
I’ve only been writing on peak oil silliness for a few months. Since I’m late to the party it’s fun to look at some older discussions.
By the way, here is a short, unsorted, incomplete list of reasons peak oil is really peak idiocy:
- Human ingenuity and creativity – the power behind the new technology
- New technology makes it possible to recover oil that we could not have touched before.
- Rising prices make more oil feasible to recover.
- Discovery of fields today that we didn’t know about yesterday means there’s more recoverable oil.
- As new fields are developed, geologists find out there is more oil in the field than they thought.
- Rising prices drive more exploration.