CleanTechnica is the #1 cleantech-focused
website
 in the world. Subscribe today!


Fossil Fuels lonely-oil-rig

Published on July 4th, 2014 | by Christopher DeMorro

111

BP: Easy Oil Gone In 53.3 Years

Share on Google+Share on RedditShare on StumbleUponTweet about this on TwitterShare on LinkedInShare on FacebookPin on PinterestDigg thisShare on TumblrBuffer this pageEmail this to someone

July 4th, 2014 by
 
Gas2

lonely-oil-rig

Big Oil companies know better than most just how much oil is left in the world. The thing is, can you really trust an industry whose own estimates vary widely depending on the year and economic climate?

USA Today reports that the latest BP global oil reserve estimates gives the world just 53.3 years of easy energy left. After that, the crystal ball gets fuzzy. How much oil is left in the world?

These estimates are actually 1.1% more than last year, thanks in part to growing estimates of American shale oil. Of course keep in mind that the oil industry is regularly growing or shrinking estimated energy reserves, with California’s Monterey Shale having its reserves downgraded some 96%. There’s also suspicion that countries like Saudi Arabia are outright lying about how much crude they actually have left. So yeah. Skepticism.

53 years sounds like awhile, right? Well not really, but the bigger problem is that, as humanity reaches the last of its oil reserves, without an adequate energy transition in place, some countries could be caught flat-footed. That’s why the innovation of electric cars and other alternatives are crucial to develop right now.

The high gas prices and regional conflicts will begin long before the last drop of oil is extracted, and if the world isn’t ready, things will get really ugly really fast.

Source: Gas2. Reproduced with permission. 

Keep up to date with all the hottest cleantech news by subscribing to our (free) cleantech newsletter, or keep an eye on sector-specific news by getting our (also free) solar energy newsletter, electric vehicle newsletter, or wind energy newsletter.

Print Friendly

Share on Google+Share on RedditShare on StumbleUponTweet about this on TwitterShare on LinkedInShare on FacebookPin on PinterestDigg thisShare on TumblrBuffer this pageEmail this to someone

Tags: , , , , ,


About the Author

A writer and gearhead who loves all things automotive, from hybrids to HEMIs, can be found wrenching or writing- or esle, he's running, because he's one of those crazy people who gets enjoyment from running insane distances.



  • Pieter Siegers

    53.3 years is the most stupid figure I’ve ever heard, that just can’t be true as there are so many fuzzy factors… it’s better to have a good laugh about it and continue the switch to clean energy sources, to not waste our valuable time.

  • Doug

    Rising oil prices reduce consumption. As inexpensive oil becomes harder to exploit, prices will rise and consumption will be kept in check. The problem is that today’s rate of consumption is not sustainable at current prices – causing economic problems for just about everyone.

    Forward looking Governments must act swiftly to enact measures to ween their economies off oil. Set targets for reduced consumption, especially imported oil.

  • Doug

    Demand for oil is driven by agriculture and transportation: fertilizer, pumps, cars, trucks, ships and aircraft. Today, renewables do close to nil to put an impact in demand for oil, the primary competitor to renewables is coal.

  • Jouni Valkonen

    “Big Oil companies know better than most just how much oil is left in the world.”

    LOL

  • http://MrEnergyCzar.com/ MrEnergyCzar

    There is a thousand years of oil reserves on Titan but that doesn’t mean we can afford to mine and burn it….

    • Rick Kargaard

      Don’t you mean methane?

      • Jouni Valkonen

        Titan has mostly of course methane and ethane, but there is also huge loads of longer carbohydrates, that we call oil products.

        • Rick Kargaard

          That would kind of put the lie to the theory that all oil on earth is derived from ancient (or not so ancient) life forms. there is much we don’t know.

  • http://www.michaeljberndtson.com/ Michael Berndtson

    Easy oil, technically, is already gone or in production. This would be conventional oil. Pretty much all the new E&P (exploration & production) oil work being now falls under unconventional. This would be ultra heavy oil like tar sands from Alberta. Shale and tight oil from Bakken in North Dakota. Deep water oil, where drilling is done in water deeper than a mile or more. Oil from below the Arctic ocean, would also be considered unconventional and expensive. Regardless of what type of rock pores its imbibed into.

    One of the reasons we’re not paying $2.50 per gallon, even though the US is awash in domestic oil, is because the production cost is so expensive. The other reason is that all this domestic oil gets traded on the international market, regardless of being extracted from North Dakota and burned in cars in Denver or Chicago.

    Technically, we could strip mine the surface of Illinois farmland and turned the organic rich soil into oil. That would not only be dumb, but a waste of farmland. Nonetheless, it makes about as much sense as mining tars sands and turning it into motor fuels.

  • http://www.energyquicksand.com/ Edward Kerr

    Short but not so sweet an article. The point made here is so obvious that one would think that the “transition” would be almost complete by now. Because we have allowed “vested” interests and the politicians that they rent to do everything possible to delay the transition (which they are well aware needs to happen) we won’t be caught with flat feet but rather with feet shot full of holes.

    And, Christopher. In case you haven’t noticed high prices and regional conflicts (over oil) began a long time age and it’s already ugly and promises to only get worse if we don’t get serious about moving to a carbon neutral energy production paradigm.

  • wallybobble

    with global warming accelerating all this oil should be left in the ground. the carbon cartel is sitting on 5 times more carbon in reserves than the atmosphere can absorb. already factored into their stock price.

  • Mesquite Ice

    Easy oil is at most 10 % of in place reserves. The 90% oil can be recovered by EOR processes. If the conventional oil wells are fracked, you can bring out nearly 50% of the oil. Which means that there is 350 to 400 years of non-easy oil left. Easy oil is extracted at the rate of 2$ per barrel. This would cost 40$ per barrel.

    • mds

      OK, then why is oil stable at $100/barrel?

      • Bob_Wallace

        Because higher prices start causing economic weakening and demand destruction?

        ~$100 is the highest price the market will tolerate. It takes no conspiracy for suppliers to look at what others are charging and do the same. And the industry has probed higher prices and found ~$100 to be the ceiling.

        (That’s a hypothesis. I don’t know enough facts to make it my guess.)

        • mds

          Demand destruction is already happening. …maybe it’s not happening fast enough to concern the oil majors.

          My point was Mesquite Ice claim of $40/barrel might not be correct if it’s been selling for $100/barrel. Forgot about the monopoly aspect. I still don’t know about that 350 to 400 years of non-easy oil, especially with increasing rates of use.

          Doesn’t matter, the greedy monopoly angle brings me to the same place. Oil based transportation is going to be replaced rapidly by electricity based transportation because of the cost advantage.

          • Rick Kargaard

            You are not looking beyond your borders. World demand is increasing

          • mds

            Yes, I am looking beyond our borders.
            How many electric bikes and motorcycles are now being sold in over-seas markets? How much is China investing in Solar PV? Is Tony Abbott succeeding in stopping Solar PV in Australia? What is going to happen with storage there? What is the advantage of Solar PV over Diesel power generators in India? What is the newly elected India premier’s position on distributed solar? What is happening with solar in Chile?

            Solar PV is the cell phone of the power industry. This applies particularly well to use in under-privileged markets, new and growing markets.

            Wake-up RIck! Solar PV is going to be the World’s largest source of power within the next 20 years …and I CAN make a good growth case for that! (Hopefully Zach will be putting that up soon.) Hand-in-hand with this, electric transport will also be taking over. It may be a little behind the Solar PV time-line (I’m not sure), but it is coming.

            Cogitate this:
            http://online.wsj.com/article/SB123172034731572313.html “Technology Levels Playing Field in Race to Market Electric Car” – January 2009
            “210 primary parts” for an EV.
            “1,400 powertrain parts” for an ICEV.
            Which will be lowest-cost in the end? What will individuals in the under-privileged world, the World’s fastest growing market, individuals on a tight budget, …purchase?

          • Rick Kargaard

            Hey I am only stating facts. World oil consumption has been going up since the recession eased.

            http://www.bloomberg.com/news/2014-03-14/iea-raises-2014-oil-demand-estimate-as-world-economy-recovers.html

          • mds

            I understand and acknowledge what you are saying as correct. However, you’ve just given me even better information that oil will never be going back to $10/barrel, or $20/barrel, as we did in the 1990′s. I see this as indicating Solar PV, Wind, Storage, and EVs/PHEVs now have the economic advantage. They are all still dropping in cost. They are all still growing faster than their fossil fuel counter parts.

            Bottom line: Recent increases in fossil fuel use are speed bumps in the big picture, a small wave in the generally ebbing tide of future fortunes for fossil fuels.

            Maybe I’m wrong, but that’s how I read the tea leaves. I think that global economics will dictate this change. I believe we have only seen the beginning effects of the virtuous cycle that will be at play for all three technologies. This is true globally.

          • mds

            …you know investments in deep-water oil, oil sands, and fracking all contain a lot of risk. Have you noticed that financiers are beginning to rate these risk higher? Definitely the case for central power generation plants. The game is changing. It will change faster going forward.

          • Rick Kargaard

            I agree with you basically. Oil will never go back to 10 or 20 dollars. In fact it will probably increase more in price as production dwindles. Lower oil prices will not be a good thing for alternatives such as electric vehicles. However cheap natural gas and coal is complicating the switch to alternative energy sources. Oil is not a very large factor in electrical production.

          • mds

            “However cheap natural gas and coal is complicating the switch to alternative energy sources.”
            Yes,
            but Solar PV and Wind are still dropping significantly in cost. Also,
            Solar PV is the big winner because it can be installed at the point of
            use, at the end-of-grid. Simple economics mean NG and Coal cannot beat
            Solar PV there, especially since the cost keeps dropping for Solar PV
            …and low-cost storage is just around the corner.
            I’m telling ya, the “future’s so bright I gotta wear shades”.

            In
            the US Coal use has been shrinking. Maybe 2013 was a slight exception
            (can’t remember) but count on this trend to continue. The need to
            central generation, for coal, will continue to shrink. When consider NG
            consider the cost over-seas and consider the greed factor. I guarantee the US will export NG …and, of course, the prices will go way up when that happens. Actually, the history of NG is one of leaping prices. What else for NG? Fracking problems: pollution of aquifers, large scale methane leakage, and earth quakes …not a secure future at all.

            Nope, Solar PV and low-cost Storage is going to eat their lunch.

          • Bob_Wallace

            Do you know of a good price chart for NG electricity? One which lists kWh price as a function of gas price?

          • Mesquite Ice

            Salt was once given the same respect, what happened now? You have to factor the innovative spirit of humankind. Imagine a technology turning dirty coal into crude oil. Imagine plastics being decomposed by special microbes into crude oil. Imagine crude oil producing bacterial that can directly fix atmospheric CO2. The list is just endless. The three technologies you said may drive the next 50 years but human kind will not stop with this. It is destined for higher things. Nicola Tesla was experimenting transfer of electricity without a cable, but that work is incomplete. Just wait and watch. Dont get spooked by the Oil lobby.

          • mds

            Not spooked. Oil lobby is a problem, but they are not winning. That is much of what I’m trying to say here. Mr. Kargaard is way more cautious about proclaiming this that I.

          • mds

            …Actually, I look beyond our borders every time our lame congress fails again, …every time they support the big fossil fuel companies and fail to support renewables. I look at the global market and think “Doesn’t matter, if the US doesn’t do it, then the rest of the world still will. …fat monopolistic fools!” What does matter, is the US will lose competitive advantage in these businesses, which are going to be huge. How people can fail to see this is a source of constant astonishment to me. Read “The Solar Revolution” copy 2006. Travis Bradford predicts the tipping point to be 2015. He was a little under. It has already passed. Solar PV is HALF THE COST of end-of-grid electricity in Australia and Hawaii. Dude! It’s gone! The crazy wild stallions are out of the barn!!! Go ahead, try and stop them.

            Think I’m crazy. Well, of course you’re right, but that doesn’t mean I’m wrong.

            My best buddy has an MBA from Carnegie Mellon. He has told me a good rule of thumb for disruptive growth is if you can deliver the same product at HALF THE COST. WE ARE THERE NOW …AND SOLAR IS STILL DROPPING IN COST!!!
            At this price advantage individuals or companies can afford the cost of changing over and still come out saving. I’ve been waiting for this to happen for two and a half decades! WE ARE THERE NOW! IT ONLY GETS BETTER FROM HERE!

          • Rick Kargaard

            Good, I hope that is in fact going to reduce the demand for oil and that the price will hold around 100. Perhaps we can avoid another recession for a bit longer. Pursuing EV technology and solar and wind energy is something I have thought to be an excellent idea for many years. We got started a little late though. Lets hope we can catch up.
            As for your lame congress, your entire system looks a little weird to many of us in Canada. I am often amazed at how well the U.S. does in spite of it

          • mds

            You and me both. It’s nuts. Of course there are certainly some scorched earth Canadian politicians and voters as well.

          • mds

            …and speaking of being able to afford to change …what has been happening? Leasing and Loans are expanding rapidly!

            Do I need to hit you over the head with a stick! Solar PV is happening! EVs and PHEVs are coming next! Globally!!!

          • mds

            Rick,
            Beyond our boarder?!
            Even the Saudis and other Middle Eastern countries are now investing in Solar PV …and they are buying EVs …well Tesla Roadsters anyway. (That one’s a stretch..)

          • Rick Kargaard

            They know they are running out of oil. They are just not about to tell you or me.

          • mds

            Actually, I have to disagree with this. There is tons of non-conventional oil, particularly NG which can go GTL. We’ll cook ourselves if we use it. I don’t think we will. The economics are changing in favor of renewables, as I’ve been railing about.

          • Rick Kargaard

            Yes, I don’t think there is much limit to the amount of natural gas, depending on if the technology is there to recover it.
            It does not, however, replace oil for many purposes with any efficiency and they should not be lumped together.
            Non conventional gas will likely prove to be much more expensive as well. The “drill, baby, drill” policies have skewed the market, and made any sort of future estimations difficult.
            If we used past comparisons of oil to gas, then gas should be around 16.00 instead of 4.00. The two have become totally disconnected. A good thing or we might get a little cold in our Canadian winters.

          • Mesquite Ice

            I was only making a hypothesis. At least you will agree that extracting non conventional oil is much more costly than conventional oil.

            But the point is that the oil exporters want to keep markets spooked about running out of oil. The US was originally a party to this because they depended on Middle east until fracking arrived. The middle east is dripping in oil to the amount that we will die of global warming before we die of lack of oil.

            The unexplored offshore prospects only make the reading worse. But the trading lobby has to make money from these things and therefore the price distortion.

            How else in the world can you think of expensive Shale oil still survives when easy oil is still around. The easy oil guys make 98 $ per barrel while the shale guys make 10-15 $ per barrel.

            That is how the royal sauds and qataris can splurge and still survive like parasites and keep funding extremists to the hilt.

          • A Real Libertarian

            How else in the world can you think of expensive Shale oil still survives when easy oil is still around.

            Because easy oil isn’t enough to supply the world.

            As a result, the price has to be high enough to make that last bit of production profitable, otherwise supply wouldn’t meet demand and the economy would collapse.

          • mds

            “extracting non conventional oil is much more costly than conventional oil”
            Certainly, did I say different?

            “But the point is that the oil exporters want to keep markets spooked
            about running out of oil. The US was originally a party to this…”
            The US is still party to this. They just want you to believe the US is flush with oil …and we are, but for how long and at what price?

            Die of AGW before we die of lack of oil? Sure, except that deep-water oil is expensive, so renewables will put them out of business soon.

            “A Real LIbertarian” is correct, expensive shale oil survives because we are past peak for easy oil and supply cannot keep up with demand.

            How does anyone know how much oil is left in the Middle East? It could start to run out in a few years …or not.

            What the Saudis and Qataris are the bad guys for supplying our gluttony? Yes, I want the US out of the Middle East and we can (will!) do this with renewables now, but we are culpable. We could just say “no thanks” to their Middle Eastern oil. …I think we’re starting to.

          • Mesquite Ice

            Very true. Why cant the big heads in the congress figure this simple thing out?. Or is it a planned conspiracy to prevent the USD from crashing.

            To be fair to US, why cant other countries like japan try this out inspite of severe energy shortage. Even the chinese indians etc cannot kick their addiction.

            Are we missing somthing here. Is the addiction to oil a bigger problem than the lack of oil.

            I am still not convinced about your theory of oil shortage but agree with you on the cost of technology, given the fact that fracking will lead to reopening fully dry oil wells because conventional drilling used to produce only 5 to 10% of oil in an oil well and EOR and fracking is likely to increase oil recovery significantly upto 50 % if not more. But Fully agree that renewables are the only way forward.

      • Rick Kargaard

        It is not very stable. It bounces up with every little bit of disturbing news from the middle East.

        • mds

          Another reason renewables are winning. The global supply is having trouble keeping up with demand, it is at the razors edge of getting by, AND any glitch causes a supply problem. Can you imagine the result of another 1970s oil supply crisis? We’d be talking EV/PHEV production going to light speed. (OK a little exaggeration there. At least I didn’t say ludicrous speed. Seen “Space Balls”?)

          • Rick Kargaard

            I agree, The demand for lower cost alternatives would increase dramatically. The ability to meet the demand may take some time to catch up.

          • mds

            Man for an optimist you can sure come up with the problems that will block progress. As somebody pushing new-tech solutions for a living, I have to tell you that is not helpful.
            Here is something to consider on this latest problem:
            The US radically changed infrastructure and commercial production on a massive scale during WW2. Production of war planes was something like triple peace-time production. Almost all car/truck production was converted to military vehicles. THIS WAS ALL DONE IN A FEW YEARS!!

            …so, no, it should NOT “take some time to catch up”. Don’t get me wrong, there will be bumps like we saw in 2007 with the shortage of manufactured purified silicon …BUT this will be as short lived as the silicon shortage was …and it will result in better production at lower cost (due to the larger scale). Remember the four technologies I mentioned above (sorry I said three above, but that was an error) all represent huge markets. There is a lot of money at stake! …profits at stake! True capitalism, not that predatory monopolistic non-sense we have a lot now, but true capitalism is very good at delivery capital to where it is needed. Stand by for very high rate growth! Bet on it!

          • Rick Kargaard

            Identifying potential problems is the first step towards finding timely solutions.

          • Bob_Wallace

            Try bringing potential solutions along with the identified problem….

          • Rick Kargaard

            If I had one, you would be the first to know. If I put it out there perhaps some one will have a reasonable answer other than just unbridled optimism.

          • A Real Libertarian

            Production of war planes was something like triple peace-time production.

            https://en.wikipedia.org/wiki/World_War_II_aircraft_production

            Tripled from ’39-’40 and tripled again from ’40-’41 then increased 2.5x from ’41-’42.

    • Rick Kargaard

      Most conventional wells have already been fracked. The difference is that these wells do not have long horizontal legs and do not use large multi-stage fracks. The fracks are usually done quickly without the huge demands for equipment and water as is used for tight oil

      • Mesquite Ice

        excuse my ignorance! Fracking is such a new technology that it is not anywhere outside US. Most of the oil (say 80%) produced in the world for the past 100 years were outside the US.
        Also not all horizontal drillings are fracking. Just because of the similarity in bringing out oil using liquids is common to both conventional and non conventional tech, it doesnt automatically mean that both are one and the same.

        • Rick Kargaard

          Facking is not a new technology. Basically it is fracturing the oil bearing formation as the name suggests. High pressure is applied to the formation, using water or other medium, untill cacks open up, Sand or other “Proppant” is pushed in to hold the formation open. This allows pathways for the liquid or gas to enter the borehole and increases the area of production.
          There have been some fracks done using liquid nitrogen, propane or diesel fuel. I believe this is sometimes done because of a fear that water will damage the formation and impair production One case might be where oil is pushed by low pressure natural gas or if low pressure natural gas is what is being produced.
          The new technology is accurate horizontal drilling, able to follow narrow formations for several thousand feet. I have heard of wells where the horizontal leg is up to two miles long. Drilling horizontally is not new, it is the accuracy that is.
          In horizontal wells, fracking is done, a portion at a time, in as many as 12 stages. This is necessary because the producing area of the borehole is very long as compared to a conventional well which may have only a few feet of producing borehole.
          Fracking is definitely not just confined to the U.S. It is used in all petroleum producing areas.
          Almost all horizontal drilling is in “tight” oil or gas formations and requires fracking to obtain reasonable production.
          Fracking is not new. It is just new to the American public. It is certainly not new to me. I live in Alberta and talk to oil workers almost daily. I have also hauled water to smaller fracks which usually take only few cubic meters of water.
          Finally, all fracking is basically the same. It involves pumping fluid and proppant under pressure to the producing zone in order to fracture the formation.
          There is plenty of good information on the internet but you will have to scroll past the environmental sites to get a balanced picture.

          • Mesquite Ice

            Thank you for the first hand information. I only learn from internet and therefore may be inaccrate about these facts.

            So then can existing wells be horizontally drilled to produce more oil. Since oil doesnt exist as tanks in oil wells but like a sort of adsorbed on a hard concrete sponge like cavities, horizontal drilling can release huge amounts of oil from conventional wells, leave alone tight wells.

            At least could we presume that the fact that it has not been possible to get more than 10% from an oil through conventional methods, offers a hope that if a techology is developed to open the 90% of oil still left back, what would be the reserves??

            I am against the oil lobby trying to spook people to believe that there is an oil shortage when there is an oil glut. But I am against use of oil because we will die of CO2 even before we run out of oil.

            The next breakthrough in genetic science is already on the horizon. a co2 fixing bacteria that can fix atmospheric co2 to produce the fuel of your choice. There is a missing link in the carbon cycle, we just have to figure out that there is an elephant in the room.

          • Rick Kargaard

            Yes, an existing well can be re-entered and it is possible to drill horizontal. It is probably only feasible for a very few wells. I think it would most likely be done in different formations from the one producing to the conventional well.
            We are not going to run out of oil as you say but we are going to run out of affordable oil and probably much sooner than most would suspect.
            The so called oil glut you refer to is a fantasy and only refers to current conditions in the U.S..
            If it were not for imports from Canada you would likely still be facing shortages and higher prices.
            We are however very close to North American self sufficiency for the short term. Emphasis on North American.
            I suspect that this is only temporary until tight oil production plateaus. Something that already appears to be happening
            The same is likely not true for natural gas but severe restrictions on fracking could cause supply problems and higher prices.
            My knowledge is from conversations with engineers and geologists in the petroleum industry, as well as internet research, and therefore subject to correction by petroleum geologists or engineers.
            I have lived in the middle of the oil patch for most of my life and have seen oil pumpers rapidly disappearing from view. Conventional, cheap and easy oil is almost gone.
            We need alternatives to save our ass.

          • Jouni Valkonen

            I think that you are painting here too rosy picture on fracking. I recommend for you to read Bill Powers book: ‘Cold, Hungry and in the Dark’. It discusses a lot about prospect for US natural gas production and is making arguments that there is not that much left for cheap natural gas in United States. And fracking boom is more like a temporary phenomena than long term opportunity.

            Therefore, even if we ignore the potentially vast and mostly unknown environmental hazards of fracking, fracking has very much difficulties to prove that it is economically feasible in any longer term than 10 years.

            The global oil supply was already proven to be inadequate already in 2005. So exactly, we have already run out from cheap oil. Of course there is also that OPEC is artificially limiting oil production in order to get the market price into unnaturally high levels.

            I think that OPEC should be dismantled as it is using irresponsibly its state as a cartel.

  • mds

    No, tar sands and deepwater oil are NOT easy oil. They are expensive non-conventional sources of oil.

    “And everyone will have to remember that fossil fuel companies have known about their problems for at least 25 years.”
    Yes, when they ask for a bailout the answer should be: no.

    • Rick Kargaard

      Oilsands are not nearly expensive to produce as you might believe. Current oil prices make it quite profitable.

      Tight oil like the Bakken are not so certain, as it is not known how long wells will produce, similiar to shale gas.

      Deep water is another fish altogether.

      http://business.financialpost.com/2014/02/20/oil-sands-retain-competitive-edge-over-u-s-tight-oil/?__lsa=2392-f873

      Cost of production is usually based on new projects. Established ones usually have lower costs.

      • mds

        Informative link, thank you. Actually, I thought oil sands were lower cost than that ($35/barrel), but I have not been following it for a while now. Inflation? I was not aware tight oil in the US was so expensive to recover. As I said elsewhere here, I forgot about this huge margin. It doesn’t matter, oil monopoly greed causing $100/barrel oil prices leads to the same conclusion: Solar PV, Wind, Storage, and EVs/PHEVs will be taking of over electricity generation and light truck + car transportation.
        Smile today Rick, the oil companies are digging their own grave.

        ps Comments at that link are astonishing. I can never get over how ignorant many N. Americans are. The brainless beauty queen slogan of “drill-baby-drill” is alive and well. No matter, economics trumps nonsense in the end.

        • Rick Kargaard

          The lower cost you refer to is for projects that have been up and running for a while. The higher figures are for new projects wit high capital costs.

  • http://MrEnergyCzar.com/ MrEnergyCzar

    China is adding almost 20 million first time car owners per year and they aren’t driving plug-ins….

    • Bob_Wallace

      China has a very heavy thumb on the EV side of the scale. They plan on pushing their drivers into EVs.

      • mds

        EVs and PHEVs are going to be cheaper to purchase than ICEVs in a short time. They are already cheaper to operate.

        • Bob_Wallace

          I hope you’re right. But I can’t see EVs and PHEVs cheaper than ICEVs in a short time.

          How about fleshing out your argument? Perhaps we are using a different definition of “short time”. I, for example, see EV prices dropping to a few thousand (<5k) more than same-model gasmobiles in the next five years.

          • mds

            Empirical evidence:
            Real EVs/PHEVs have only been available on the market for a few years. What has already been happening to prices? Cost of Leaf, Volt, and Tesla EVs have already dropped significantly. Nissan is working on lower-cost longer-range battery. Tesla went from the Roadster to the Model S, which was literally “twice the car for half the price”. They will come out with the Model X soon. GM better shake a leg or they’re dead. Ford has just gotten into the game and is competing aggressively.
            We’ve already gone from no real EVs to every auto dealer offering at least one EV. EV/PHEV sales are growing faster than HEVs ever thought about. …so we have fierce competition and economies of scale at work already.

            The bigger picture of technological trends:
            Read “The Bottomless Well”. The authors point out solid state electronics have taken over in many areas. Vehicles will be no different. High power electronics does not follow Moore’s Law, so it is coming to the market later, but it is here now. People are unaware that it is not just the batteries that have made EVs/PHEVs possible, it is also the high-power electronics and electric motors. These are still improving in cost and performance. Also:
            1. Improvements in aero-dynamics are being used by some EV/PHEV manufactures to reduce the energy required to push the vehicle. (The effect of aero-dynamic drag at freeway speeds is huge.)
            2. Lighter-weight high-strength materials are increasingly being developed and used. (Less weight to push means lower power use.)

            The battery problem:
            We all read that battery cost (and to a lesser degree weight) is the big problem for electric vehicles. There are two solutions:
            1. (the obvious one) New battery technology that is lower-cost per kWh. Significant improvements to Lithium Ion batteries are still occurring. Here is one I like:
            http://www.greencarcongress.com/2013/06/zsw-20130604.html – June 2013
            “ZSW develops process for Li-ion batteries with extended cycle life; 10,000 charge cycles”
            “Scientists at the Zentrum für Sonnenenergie- und Wasserstoff-Forschung Baden-Württemberg (ZSW) (Center for Solar Energy and Hydrogen Research Baden-
            Württemberg) have developed Li-ion batteries that have already demonstrated a very high cycle life of more than 10,000 full cycles with retention of more than 85% of original capacity. The cells have a power density of 1,100 W/kg.”
            Notice these are the same mass-produceable cylinder form
            factor as Tesla is using, different chemistry.

            There are many other improvements coming from labs and there is a huge amount of money being invested. Computer modeling of molecular structures is being developed and brought to bear. Real-time visualization of molecular interactions is being developed and used, as well. (You know what they say about science and technology accelerating. Yeh, it is accelerating here.)
            2. The PHEV approach. Really I’m referring to the Extended-Range Electric Vehicle (EREV) type of PHEV. Even more specifically a Series drive EREV. The Volt is a parallel-series drive PHEV. This is a more expensive drive system and was done that way to improve performance (both the gas engine and electric motor can push the car at the same time) and for efficiency (direct drive by the gas motor is more efficient than converting to electricity to be used by the electric motor …even though you’re still doing that some of the time). I don’t buy this. The efficiency gain is not worth the increase in complexity of the drive system and you don’t need the parallel drive for increased performance at all. Take a Tesla, the new Model X when it comes out, then cut the battery down in size, strap on a house-hold generator, and add the high-power electronics you need for voltage regulation and the intelligent electronics you need charge controlling. This will be a simpler, lower-cost, EREV. Extended-Range Electric Vehicles (EREVs) give you 80% of the reduction in fuel use compared to pure EVs. PHEVs, in general, help push the battery, high-power electronics, and electric motor technologies that will see pure EVs take over in the end.

            Improved Economies of Scale:
            It is well known that larger manufacturing scale delivers lower product costs. EVs/PHEVs are now being manufactured in the 10,000s (tens of thousands). ICEVs are being manufactured in the 1,000,000s (millions). As manufacturing of EVs/PHEVs continues to increase in volume to compete with ICEVs their costs will come down. Since they are already close to the cost of ICEVs now….

            Summary:
            A. It is already happening. EVs/PHEVs are scaling faster and dropping in cost faster than HEVs did.
            B. Further improvements in high-power electronics, electric motors, aero-dynamics, and high-strength light-weight materials will mean improved performance at lower cost.
            C. We will see further cost reductions to EREVs because simpler solutions are possible AND we will see further cost reductions in batteries for both EVs and PHEVs(EREVs).
            D. Economies of Scale.
            E. The virtuous cycle. Fossil fuels will begin to see the reverse of the virtuous cycle. (the death spiral?) Look, both are already happening.

            Conjectured timeline:
            Faster than most think. Still 5 to 10 years. We will see significant head-to-head competition advantage over ICEVs before the end of this decade. We are on the cusp now.

          • Bob_Wallace

            Very good post. I agree, 5 to 10 years. I suspect closer to 10 years before EVs get cheaper than same-model ICEVs.

            But EVs/PHEVs don’t have to get cheaper to dominate the market. Get to the point at which the price difference is recovered in about three years of fuel savings and I think the big switch happens.

          • Steve Grinwis

            So, with government subsidies, my electric car cost me $15k, and costs $40 / month to operate. A similarly sized and optioned vehicle would have cost me $18k in gasmobile form, and would have cost me $180 / month to operate.

            With at least some vehicles, we’re already there, but it’s still due to subsidies.

          • Bob_Wallace

            Take the math a step further…

            $15k + $7.5k in subsidies? A $22.5k vehicle?

            A premium of $4.5k over an $18k gasmobile.

            $140 per month, $1,680 per year savings.

            Without subsidies your recovery cost would have been 2.7 years.

            Subsidies won’t hold, they are production number limited. So before EVs get cheaper than ICEVs they have to get as cheap as ICEVs without subsidies.

            We’re getting close to the tipping point. Might be less than 10 years. Wouldn’t make me unhappy.

          • Rick Kargaard

            The acronyms are getting confusing. Why not use FV for fueled vehicle. I am not certain what you mean by ICEV.

          • mds

            Internal Combustion Engine Vehicle (ICEV)

          • Bob_Wallace

            Internal combustion engine vehicle. A pretty common description of a gasmobile.

          • Rick Kargaard

            I was hoping it would happen a little faster. I would like to be able to afford one while Ican still drive, or am still alive.

          • Bob_Wallace

            “Closer to 10″ is my pessimistic guess. I’m afraid to post my optimistic guess. (Five years or less.)

            Anyone have up to date Leaf sales numbers? Getting close to the limit for US federal subsidies? I expect Nissan is ready to market the Leaf for close to subsidized prices when the subsidy disappears.

          • Rick Kargaard

            We might make it Bob

          • Ross

            Perhaps we should just watch the production capacity for new EVs under the assumption that they’ll sell as fast as production can be ramped up.

  • Raja Bob

    I wonder which easy oil they mean?

    Deepwater, tight oil, tar sands, or shale.

  • mpwilliams

    The key to understanding this little piece of news — viz., BP now estimates that the world’s oil reserves will last another 53.3 years — lies in BP’s use of the word ‘reserves,’ a petroleum engineering term that BP uses in the strictest sense of known and proven resources recoverable with existing technologies at present or expected prices. In 25 years, BP will likely release a new report estimating that the world’s oil reserves will last another 50 or even 75 years. That this is somehow possible is a source of never-ending confusion for the public and the press.

  • EBCEBC

    20 years ago it was fifty years. Talk then was tar sands and other shales coming in for production boom when oil hit $100. They got that right.

  • sault

    Add in any sort of carbon constraints and these numbers go out the window. This is why BP and their ilk spend nearly $1B a year in the USA alone trying to confuse the public about the scientific fact of man-made global warming. Also, keep in mind that 53 years is just long enough to keep people from getting worried and doing something about the problem. I guess if even the Deepwater Horizon disaster can’t get people to dump these crooks, they know exactly how hard the boat has to rock before their fossil fuel gravy train starts to run out of track.

  • JamesWimberley

    The way to read this information from an expert but untrustworthy source is that 53 years is the upper bound. It’s very implausible though as a central estimate. Unconventional oil – tar sands, shale, deep offshore – is not easy but very expensive, and it’s what is holding oil production flat. Peak easy oil has already passed. Oil capex per barrel has been rising for years.

    • mds

      “Peak easy oil has already passed.”

      Exactly! This is why oil is has stayed around $100/barrel for a number of years now. Price is now set by unconventional oil.

      As Solar PV, Wind, Storage, and EVs/PHEVs continue to drop in cost fossil fuels will phase out. This is already happening. It just accelerates now.

      I for one think any further Gulf wars would be a huge waste of money and lives. Put that money into Solar PV, Wind, Storage, and EVs/PHEVs and harvest the benefits far into the future. It would be nice to see government and industry leadership in the USA figure this out. Hang’em high if they don’t… just my slightly outraged opinion.

      • Ross

        Two trillion $ spent on renewables would have bought about 1,000 GW. That would have done a lot more to improve world security.

    • Rick Kargaard

      All true, but it is supply and demand that determines price, not the cost of production.

      • Bob_Wallace

        If price doesn’t support production then supply drops.

  • http://onepercenttakers.com/ mtracy9

    With any luck BP will be gone long before then.

    • Ross

      Or the P could stand for Photovoltaic.

      • Bob_Wallace

        They’ve gone that route and then retreated. I’ve got BP panels in my yard.

        • Ross

          I saw some BP solar panels in the Science Museum in London. One lives in hope of a reversal. The alternative is managing a terminally declining business.

    • Doug Cutler

      BP went through the motions with solar a while back then tried to pass themselves off as Beyond Petroleum. If they get their way and burn all those “easy” oil reserves, BP will stand for Backed Planet. But they won’t succeed. Much of the oil will wind up staying in the ground at which point BP will stand for Beyond Profits . . . unless they rethink and give Beyond Petroleum another try.

  • Bob_Wallace

    This sort of prediction stuff should be taken with a grain of salt.

    We’re on the cusp of affordable long range EVs and, possibly, affordable FCEVs. A large scale move to electricity will lower oil demand and stretch the supply.

    • JamesWimberley

      Let’s game this. In the short run, rising demand in Asia and constrained supply push oil and gas prices higher, making unconventional sources profitable. But this accelerates the structural shift to renewables. It’s structural because renewables are all capex; their marginal cost of production is always near zero. No wind turbine will ever be turned off because the oil or gas or coal price falls. It’s a one-way substitution.

      Now beyond a tipping point, rising renewable supply reduces demand for fossil fuels (see coal in Australia and Germany today). Their price falls sharply, stranding a lot of high-cost assets and freezing new investment. Fossil share prices crash. Many companies have to be bailed out by governments to secure a continued supply of fuels for shrinking legacy uses.

      This is the real scenario that BP is working on and won’t publish. Notice the way the majors are tiptoeing away from American shale gas, and cutting their exposure to deep offshore in Brazil and the Arctic

      • mds

        “Notice the way the majors are tiptoeing away from American shale gas,
        and cutting their exposure to deep offshore in Brazil and the Arctic.”

        I wasn’t aware of that. Very interesting, thanks!

      • Rick Kargaard

        Shale gas is likely proving unprofitable due to short production lifrspans.

    • Rick Kargaard

      We can only hope that it happens fast enough. World oil consumption seems to be increasing at an alarming rate. I think we are approaching a dangerous situation as increasing shortages raise prices.

      http://www.worldwatch.org/oil-consumption-hits-all-time-high

      • Bob_Wallace

        It can happen fast enough.

        I’m going to have to make one assumption – battery price is a function of low manufacturing levels and prices will fall as production volume increases.

        Right now with gas <$4 in most of the US there's not enough demand for PHEVs and EVs to kick sales into warp speed. Take the price up significantly and people will start looking for alternatives to their current ~25 MPG rides.

        It typically takes a car manufacturer about three years to do the R&D for a new model. However, most car manufacturers have already done that work. Most have one or more electrics in, at least limited, production. That means that all that would be needed is to dedicate more assembly line space to electrics. Car companies shut down and retool for a new model in weeks.

        If gas prices jumped to $6/gallon this afternoon our showrooms could be full of EVs and PHEVs by Christmas, if not Labor Day.

        $6/gallon fuel would make EVs and PHEVs affordable. The premium monthly payment would easily be covered by fuel cost savings.

        Ramp up production volumes to the half million/million per year level and batteries will quickly fall in price.

        • Rick Kargaard

          I wonder, Gas prices are already that high or higher in much of the developed word. Of course, those with the highest prices sometimes have the best acceptance of electric cars. U.S. prices are actually quite low. In fact, in most cases much lower than “oil rich” Canada.

  • Ross

    Reserves of what they call “easy oil” will shrink as renewable energy establishes itself as the new easy choice.

  • Steve Grinwis

    53 years but at what price? $500 /barrel? 1000? More?

    • Ross

      They might not be able to give it away in 53 years.

      • Steve Grinwis

        We can only hope.

        • Calamity_Jean

          Some will still be wanted as lubricants, maybe.

          • Steve Grinwis

            synthetic oils bypassed mineral oils decades ago. we dont need dino oil.

          • eject

            And what do you think synthetic oils are made from?
            From a dino base cracked down with Hydrogen from natural gas and catalitcally converted while being heated with energy from burning the scraps. But the amounts of such usage is laughable compared to what is burned for fuel. NEver the less, we will use dino products for a long time, just not for energy.

          • Steve Grinwis

            From the great wiki:

            ” Synthetic lubricants can be manufactured using chemically modified petroleum components rather than whole crude oil, but can also be synthesized from other raw materials”

            I believe we can make synthetic oil from other starting materials, and we don’t have to make them from crude. We do for now, because it’s cheaper, not because we have to.

          • Bob_Wallace

            “California-based Biosynthetic Technologies, in partnership with Albemarle, announced that operations of a demonstration production plant for biosynthetic lubricant oil within Albemarle’s existing Baton Rouge facility have commenced.

            Biosynthetic Technologies holds exclusive rights to patented technology that converts fatty acids into high-performance synthetic oils that can be used in lubricant, personal care and other chemical sectors. These biosynthetic base oils exhibit many superior characteristics to petroleum-based lubricant oils.”

            http://www.greencarcongress.com/2013/10/201310115-biosyn.html

          • wattleberry

            Even this will be minimised once ICE oil changes are no more.

          • Calamity_Jean

            True, and good riddance.

    • Rick Kargaard

      Exactly, there is a difference between easy oil and affordable oil. Production has to only drop a little below demand for prices to climb. In my opinion, oil is already very close to being to pricey to support our economies.

      • Steve Grinwis

        I think in a lot of ways we’re already there as well. The combined cost of oil, and all the various externalities are already more expensive than EV’s for most applications.

        A carbon price would flip the switch on EV’s.

Back to Top ↑