Sunday, October 22, 2006

Peak Oil, Climate Change and Oil Sands

Peak Oil, Climate Change and Oil Sands

Climate change and peak oil are a curious combination, one has global scientific credibility as not only real but urgent and serious, the other is todays hot topic and the focus of much controversy.
I have been faced on several occasions with a climate change discussion moving into a discussion of peak oil, the question that always comes to mind is why? When there is such a degree of evidence for the catastrophic effects of climate change, why do we need to look at an issue where the the facts are muddy? In the end it is down to money, if people are being hit in the pocket then –the argument goes—they are going to be more likely to support renewable energy, conservation and energy efficiency schemes.

Whilst I do not profess to have a detailed understanding of peak oil, I do not believe this is necessary in order to note some of its flaws and thereby throw a cautionary note the way of climate change activists. If you base your campaigns on a weak premise then don't be surprised if this weak spot is undermined and your whole campaign is weakened.

First, some general points about the importance of crude oil supply. In 1973, the world realised 53% of its energy needs by the combustion of oil, by 2004 this had dropped to 41%[1], this decline is predicted to continue. Working for a habitable planet we would all like to think that renewable energy is pushing this decrease, to the contrary it is competition with other fossil fuels that is of greatest near term importance. Coal is dangerous to mine, is dirty, toxic and produces nearly twice the co2 of natural gas per unit energy, natural gas is clean, low emission and increasingly scarce.


When looking at the primary energy supply of the world it is possible to dream that within the next 20-30 years renewable energy will make up a really substantial part of this sector. And, indeed, wind power is growing at a phenomenal rate, solar power is decreasing in price at impressive speed and installations of solar thermal and pv are expanding at growth rates to match. All these technologies, and the many more being developed, are however starting from a very low base. Even with a level playing field--which we are far from due to enormous fossil fuel subsidies--or a carbon tax on a global level, we would still require one missing ingredient, that of time time if we where going to entirely sever our dependence of fossil fuels.

The problem is, therefore, not that we have a shortage of oil, as much as the alternatives we have are disastrous. If oil prices remain high then accelerated development of coal will be an attractive option and it just so happens that the worlds largest coal reserves are in China, with the USA a close second, Australia third and India fourth [2]. It is perhaps not very comforting to note that the worlds largest economy and two of the largest emerging economies are sitting on the worlds most dangerous carbon bomb!

Peak oil is not likely to be a significant driver or saviour of our climate, on the one hand it promotes conservation and on the other it promotes energy security. In China, Indonesia, India and increasingly the USA this means coal over middle east oil.

I believe I have made it clear that peak oil is not an issue that is encouraging to me as a climate activist, and wouldn't be even if I believed in some of the extreme scenarios of peak oil theory. The other half of the argument is, do i believe in these scenarios?

The basic answer to this is that I think the world energy supply is sufficiently diverse and our knowledge of chemistry, sufficiently polished for a cessation of expansion in oil production from traditional sources to be of very little concern.

I studied chemistry at the University of St Andrews (UK) where one of the largest investments made into the university was made in the field of Homogeneous Catalysis or more simply, research into how to cheaply make oil from coal. This investment was made by the south Africa solids to liquids company (SASOL), during apartide South Africa made its own oil from coal as no one would sell them it.

This is the first buffer against a dramatic drying up of oil supplies, we can profitably make oil for from coal for $40 a barrel. This isn't happening, because oil companies and there investors do not believe that they are likely to make a reasonable profit on such facilities over the next 40 years[3]! Economics is often a good way to tell where things really lay and over the next 40 years (the lifetime of these projects) it is to risky to bet that the average price of oil will be $40 a barrel.

The other reason that peak production is likely to be a slow ramping up of prices rather than a dangerous and rapid increase that there are more oil sand reserves in Canada than there is traditional oil in Saudi Arabia[4]. These oil sands, are more affordable than coal to liquids, and are being developed. By the scale of the investment, they are clearly seen as the future. They are however, closing the gap between coal and oil in terms of greenhouse gas emissions. Oil from this land does not push its way out of the ground in great geysers it is laboriously extracted. Some of the tar sands, perhaps 20% [4]are shallow enough to be minded directly, this process has a devastating impact on the environment. For the remaining 80% there is arguably and even more atrocious development, this oil requires chemical separation and treatment with steam before it can be passed on to the refiners[4]!


The process of mining tar sands is ecologically damaging and hugely energy intensive--natural gas is being consumed at outrageous rates. The expansion of tar sands as a source of oil may prove to be a significant factor in increasing the carbon intensity of transport.If we look at the carbon content of fossil fuels we find that gas is the least polluting per unit energy at 15.4 tonnes Co2 per TJ, followed shortly by oil at 20 tonnes co2 per TJ and both some way behind coal at 26.8 tonnes co2 per TJ[5]. If we look at oil from tar sands that has bit extracted in situ we find a quite different story.

Oil sands extraction requires around 700 cubic feet(19.81m3) of gas per barrel4. This energy is required for heating pumping. A chemical separation stage is then required before steam reforming to convert the extremely viscous bitumen into a crude that has between 40 and 60% more value[4].Steam reforming requires around 1050 cubic feet (29.72m3)[4] of steam per barrel. The obvious question that arises is just how much of the energy contained in a barrel of oil is actually used up in its own extraction and processing. Canadian natural gas has an energy value of around 38210 Kj/m3 1 this means that in extracting a barrel of oil we use (19.81+29.72)*38210 Kj of energy, this is 1,892,000 Kj. So what portion of a barrel of oil does this represent? The energy content of a barrel of oil varies but is typically around 6,120,000 Kj 1. At the end of the calculation we find that 30% of the energy content of a barrel of oil is consumed in its extraction! If we now look again at gas vs oil vs coal we find that the figures are 15.4(gas), 20(oil),26(oil from tar sands), 26.8 (coal). We have made oil very nearly as carbon intensive as coal!

References:
1.IEA Key Energy Statistics 2006
2.BP Statistical Review of World Energy 2005
3.http://www.columbia.edu/dlc/dkv/earth_institute/cci_06/cci_092806_lackner_56k.mov
4.World Energy Book Issue 2, World Energy Council,
5.IPCC 1997

This was a brief foray into peak oil...

I attempted to describe how it connects (or dosent) with climate change advocacy . I sent this off to the uk section of a peak oil site called theoildrum, one of the british webmasters seemed interested but his Ed was somewhat less keen. Ed's views sumarised:

It's full of grammatical and style mistakes. He makes serious factualerrors and he claims a bunch of things that have been refuted at TOD,by DCohen and HO, in their excellent pieces on tarsands.

Please let me know about any errors you noticed. I have referenced the article and believe the contents to be acurate. I can email you any of the reports except the world energy council book, which i have as a paper version, i could however photograph pages and email these.

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5 Comments:

At 8:28 PM, Anonymous Francois H. said...

I personally believe your article is factually and technically acurate.
Hence, to a certain extent, I think your conclusions about peak oil and it's relationship with climate change can be accepted.
But, admitedly, you did not mention something much less easily envisioned, which is the geopolitical factor.

Don't you think that extracting oil intensively from tar sands (as future seems to be headed), and doing so, replacing traditional oil producers, will have a tremendous impact on the world economies, and the general picture of the world ?

I believe, that oil, as well as uranium and many raw materials such as steel and copper will become more and more expensive, simply because most of the world economies need expansion, and their consumption grows. Production of these materials gets more technically tough and energetically intensive.

This may or may not cause some trouble, but one thing is highly probable : at one point, humanity will have to heavily move towards conservation, climate change or not.

 
At 1:38 PM, Blogger Almuth said...

I'm quite open to the possibility of a major global depression caused by peak oil, on the scale Jeremy Leggett suggests. After all, if enough people trading stocks think that the world economy relies on growing oil supplies then it will rely on this. Stock crashes seem to have a lot to do with lost confidence, not proper resource accounting. Leggett thinks that this could catalyse a massive shift towards renewable energy, as it will coincide with ever more extreme climate disasters. I'm really sceptical about this vision: Firstly, a major global depression would immediately ratchet up global temperatures by a fair margin because it would eliminate a lot of the aerosols, so the climate crisis would become much starker, making economic recovery ever less likely. At the same time, I can't possibly see how solar and wind energy would emerge from a major economic crisis. You can't build DIY solar panels. Poor countries can't build them. Moving towards a clean economy needs large-scale investment. We have the money to invest now. It seems a no-brainer to hope for a recession.

 
At 2:04 PM, Blogger beepbeepitsme said...

RE: "The process of mining tar sands is ecologically damaging and hugely energy intensive--natural gas is being consumed at outrageous rates."

And of course it is much cheaper to access good quality crude oil. The process of mining tar sands is only economically viable when the price of crude is high.

This is advantageous if you are an energy company which is diversified, as in times of high oil prices, like now (at least partly to do with the Iraq War), because inflated oil prices increase the value of tar sand deposits, and increase the profit margin to be made from mining them.

 
At 8:48 PM, Blogger lisa said...

Hello,

I am working on a project that requires Oil Sand Pictures and I am currently having trouble finding anything fitting in any of the free stock image sites I use. In your Sunday, October 22, 2006 post there is a picture most fitting of my project and I wanted to know if it was yours by copyright and if i could obtain permission to use it or if you could direct me to whomever has copyright ownership of it.

Thank you,

L.Hurlburt

 
At 10:59 PM, Blogger Calvin Jones said...

Hi lisa,

Sorry, i`m afraid that the photo isn't mine.

If you click on it you can find its origianl url. It is actually 'deep linked' i.e it is from someone elses website on there server displayed on my blog. I find images using google images sorry i cant help you with your copyright issue.

 

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