 | The Bullroarer - Friday 22 February 2008 | TOD: Australia/New Zealand | Tapping The Source: The Power Of The Oceans |  |
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Very good work. I continue to be amazed that net oil export capacity is not the #1 story worldwide.
Regarding the end game for net oil exporters, I have slightly modified our terminology, from saying that they will hit zero net exports, to saying that they will "approach" zero net exports; however, the real damage to the world economy comes not from the final 10% decline in net exports, but from the initial 90% decline.
The ELM is a simple mathematical model that shows net exports going to zero in 9 years, from the final peak, with consumption equal to 50% of production at peak. Note that only about 10% of post-peak production from Export Land would be exported.
The thing that continues to amaze me is how similar the UK and Indonesia net export declines were, given vastly different per capita incomes and energy taxes/subsidies, with the UK going to zero in 7 years, Indonesia in 8 years. The common factor was that consumption was about 50% of production at the final peak.
It seems to me that virtually every net oil exporting country in the world would fall somewhere between Indonesia and the UK in terms of per capita income and energy taxes/subsidies.
Regarding the UAE, it was the only top five net exporter to show an increase in net exports in 2006 (EIA, Total Liquids), but our (Khebab/Brown) logistic based middle and low cases are not very optimistic, and the high case is only slightly less pessimistic (the projected middle case 10 year net export decline rate is -4%/year):
http://graphoilogy.blogspot.com/2008/01/quantitative-assessment-of-futur...
Aeldric, you have discovered that ELM is already 'alive and well' - as you have found, it's already in the data, you just have to search it out, no longer just a theory.
I would just add that you have a chart there called 'Australia's Oil Consumption and Imports', this shows the 'import land' problem very well.
Once an importing country that has some production of it's own peaks, it's increased demand % for imports suddenly becomes = (total consumption growth + the decline rate of local production) and sadly this is often a massive increased demand, as in the case of Australia.
However, spare a thought post 'world peak of net exports' for those countries where ~100% of consumption is imported - that is every country in the Europen Union except two!!!.
At the moment 'world net exports' are down ~3% from a peak in late 2005, this has allowed the 40 or so 'net exporting' countries to continue to grow their consumption while world all liquids production has been flat!
Looking on the bright side, at least you will easily meet the UN required 30% reduction in CO2 emissions by 2020 from oil!
Maybe now you can see why there has been so much emphasis on climate change emissions - working towards a planned defined goal (IMO too late and unreachable) rather than a catastrophic economic brick wall.
Hi WestTexas,
How did you calculate the growth and decline rates? For instance, the Saudi rate you quote is not the 2005 to 2006 rate. Is it the average growth (or decline) over some number of years going back? Thanks.
We used the predicted range of consumption and production numbers for 2015 to give us the low case, middle case and high case projected net export decline rate from 2005 to 2015.
Once production in a given exporting country starts falling, the actual net export decline rate tends to accelerate with time, which is what we are almost certainly going to see for Saudi Arabia in 2007 versus 2006.
Sorry, I meant how did you get the +4.4% consumption number for Saudi Arabia? Is that the average of the last 2 years demand? Or three years? Or some other procedure? I don't doubt the results, I would just like to be able to explain how it was calculated if someone was to say, why shouldn't it be 2.2%.
Khebab used a Monte Carlo simulation method, based on recent consumption, to estimate a range of future consumption, which resulted in very low projections for Russia.