The Oil Drum: Australia/New Zealand

This is a guest post by Jean Laherrère

This is a guest post from WebHubbleTelescope. The post addresses the origins and relevance (or lack thereof) of the logistic equation as it is commonly used in projecting/modeling oil production forecasts. As far as I can see, this is the first time anyone has succeeded in deriving the Logistic oil model from first principles. I will follow this with a post on the Maximum Power Principle next week, which in my opinion may shed light on the logistic curve from the perspective of oil 'demand' (as opposed to supply).

Many people believe that the Logistic equation adequately models the Hubbert peak. This comes about for a few reasons:

1. We can (often/occasionally) get an adequate heuristic fit to the shape of the production data by matching it to a logistic sigmoid curve.
2. The logistic-growth formula dU/dt = U(U₀-U) carries some sort of physical significance.
3. The logistic has hung around for a long time, in modern terms, therefore it must have some practical value.

The SMH has an article on a "Plan to drill for oil off NSW coast", with the would be explorers hoping to have a drilling rig exploring the area in May next year and touting estimates of 1 billion barrel find.

An Australian joint venture is planning to drill off the NSW coast in search of oil and gas in a move that has outraged green groups. The venture says the skyrocketing world oil price has made it feasible to establish a drilling rig 22 kilometres offshore between the Central Coast and Newcastle, The Sunday Telegraph newspaper reports.

One of the firms, Perth-based MEC Resources, says air surveys indicate there is petroleum at the target site. The listed company told the Australian Stock Exchange on Friday: "MEC was reviewing new data from an airborne survey conducted east of Newcastle which detected evidence of petroleum seeps on the sea surface." ... The MEC report estimates undersea reserves of up to 1 billion barrels of oil and enough gas to meet Sydney's needs for a decade. It is seeking shareholder approval to restructure its oil and gas assets to improve access to capital for exploration.

This is a guest post by Jean Laherrère. I was asked recently by e-mail, referring to a 2002 paper on hydrates: I read your excellent questions. Do you have any answers posted? I decided to update my past papers on hydrates.

[Update: The Brasilian press is reporting wide criticism to Haroldo Lima who at the moment is denying he announced the find: “I haven't announced anything, nor did I used that word [anoucement] at any moment.” (hat tip Carolus Obscurus).]

Reuters reported yesterday:

Haroldo Lima told reporters the find, known as Carioca, could contain 33 billion barrels of oil equivalent, five times the recent giant Tupi discovery. That would further boost Brazil's prospects as an important world oil province and the source of new crude in the Americas.

"It could be the world's biggest discovery in the past 30 years, and the world's third-biggest currently active field," Lima, head of the government's oil and fuel market regulator, told reporters at an industry event in Rio de Janeiro.

The APPEA 2008 Conference is on in Perth this week - this is a roundup of the press commentary today (or yesterday, by the time you are likely to read it).

ABC - More than 2,000 oil and gas experts gather in Perth

Representatives of the oil and gas industry will discuss ways to tackle the challenges of reducing greenhouse gas emissions, making workplaces safer and addressing the skills shortage at a conference in Perth today. More than 2,000 people associated with the oil and gas industry are meeting to discuss new demands and challenges facing the industry in Australia and overseas.

The Australian Petroleum Production and Exploration Association (APPE) expects world energy demand to increase by 40 per cent by 2030. The chief executive of APPE, Belinda Robinson, says the industry needs to devise ways to meet the growing energy demand while still achieving reductions in greenhouse gas emissions. "If we can triple our LNG production on the basis that most of that goes to the Asia Pacific region we will be helping the Asia Pacific region reduce its greenhouse footprint," she said.

This is a guest post by Jean Laherrere.


World Arctic cumulative discovery.

USGS World Petroleum Assessment

In 2000, the United States Geological Survey issued its World Petroleum Assessment, covering the thirty year period 1995-2025 (Table 1). The resource estimates from this study are widely quoted to support the argument that oil production can continue to expand. (Comments now open!)

On the morning of November 12th a friend called me saying that the largest oil field in the world had just been found off Brasil. I then explained to him what the largest oil field in the world was like, and how implausible that information was. In fact since the late hours of the previous day the media was reporting “the largest world oil find in the last 20 years". Once again our energy problems were over, goodbye 90 dollar oil and so on. Déja vu? Didn't this all happen last year with the Jack field in the Gulf of Mexico?

There has been some discussion about how to apply the Hubbert Linearization (HL) to Saudi historical production in recent weeks at TOD. Trying not to fall into redundancy, let me have some loose thoughts on these models:

Three alternative Logistic models for Saudi production. Click for large version.