Category: Uncategorized

Bakken Update, March Production Data

Ron Patterson 130 Comments

The Bakken production data, as well as the All North Dakota production data just came out with their production numbers for March 2014.

Bakken Barrels Per Day

Bakken production was up 914,003 bp/d, up 25,091 bp/d from February. All North Dakota production was 977,061 bp/d, up 24,006 bp/d from February. That was a new record for the Bakken but not for all North Dakota. They are still 538 bp/d below their November 2013 numbers.

The surge in the Bakken really started in July 2011 when they doubled number of additional wells per month. Production continued to climb in pretty much a straight line through October 2012. Then bad weather and other problems started to affect production. They are now about 150,000 bp/d below where they would have been had they continued on that trajectory. (Line on chart.)

Non-Bakken

North Dakota production outside the Bakken declined at about 12% per year until the number of additional wells per month doubled on July 2011. Then it flattened out as some of those new wells were drilled outside the Bakken. But now additional wells outside the Bakken have dropped and so has production. Production outside the Bakken is still down almost three thousand bp/d from the December numbers. So though the Bakken hit a new high in March, total North Dakota production is still below the November numbers.
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OPEC Update with April MOMR Data Plus Eagle Ford

Ron Patterson 22 Comments

The new OPEC Monthly Oil Market Report is out with the April Crude only data. No real big movers. Total OPEC crude production was up 131 kb/d but that was after March production had been revised down 148 kb/d.

OPEC 12

OPEC 12 crude only production stood at 29,593,000 bp/d. That is just over 2 million bp/d from their recent peaks in July 2008 and April 2012.

Iraq

Iraq was the only big mover, up 102 kb/d from last month.
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Of Fossil Fuels and Human Destiny

Ron Patterson 184 Comments

There have been hundreds of books and essays written on the evolution of Homo sapiens and I assume you are familiar with that history. In this short essay I am going to point out a few things that are usually left out of that story, the part that deals with the very nature of the species Homo sapiens.

First I would like to point out a few things that are common to all species, not just Homo sapiens.

All species produce more offspring than can possibly survive to adulthood and reproductive age. Some produce hundreds of offspring and leave it to chance that a few will survive. Others produce far fewer offspring and care for them for months to years to increase their chances of survival.

However if there is ever an abundance of food for any species, that species will multiply its numbers to take advantage of that abundance until its numbers are so great that the advantage disappears. An example would be the reindeer of St Matthew Island.

In August of 1944 the Coast Guard placed 29 reindeer on St. Matthew Island, a remote island in the Bering Sea. Earlier in the year they had established a radio navigation system there and the Reindeer were supposed to be emergency rations should the men be cut off from supply shipments.

A short while later, with the allies winning the war, the Coast Guard pulled their men off the island but left the reindeer there. But not to worry, the 32-mile long by 4-mile wide island had plenty of the reindeers favorite food. A mat of lichens over 4 inches deep covered the island. By 1957 the population had increased to 1,350; and by 1963 it was 6,000. But the lichens were gone, and the next winter the herd died off. Come spring, only 41 females and one apparently dysfunctional male were left alive.

Reindeer

Another example was documented by the PBS series NOVA titled Rat Attack. [1] This program documents the plight of rice farmers in a remote corner of northeast India. Surrounding the rice fields in this area are forests of bamboo, a common species called Melocanna bamboo, from which the locals build their homes. And living in this tropical bamboo forest are rats. This is not unusual as rats live in all tropical forest around the world. But the rats are few enough in number that they pose no serious threat to the rice and corn farmers in the area

However once every 48 years all the bamboo flowers, fruits then dies. The Melocanna bamboo produces a fruit, a seed pod, that is as large as an apple, some 200 times larger than the average bamboo seed pod. Over the period of a few months some 10 tons per acre of this fruit will ripen and drop. This indeed brings about times of plenty for the rats in the area.

One species of rat, the black rat, is particularly adapted to take advantage of this cornucopia of food. In the right conditions their numbers will shoot up exponentially.

When the bamboo fruit first appears around this one particular rice field the black rats numbered perhaps 100. By the time all the bamboo fruit had all ripened, fell and most of it consumed by the rats, a period of about six months, the black rat population numbered about 12,000. By then any fruit left in the forest had germinated and was inedible. This hoard of rats then moved into the rice fields devouring the crops causing famine in the local population.

Then, when all the food is gone the rats die off. They die of starvation. But a few, a very few will survive.

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How Soon Will the World Oil Production Peak?: A Hubbert Linearization Analysis

Ron Patterson 255 Comments

This is a Guest Post By “Political Economist”

In this informal paper, I conduct Hubbert Linearization exercises on the world’s 11 topoil producers as well as the rest of the world. The results are used to project the world oilproduction in the future. The evidence presented in this exercise suggests that the world oil production may peakin 2018 or a few years later.

Hubbert Linearization

Hubbert Linearization (first developed by M. King Hubbert) is a statistical techniqueoften used in the peak oil literature. Hubbert Linearization assumes that oil production rises and falls following a pattern thatcan be described by a logistic function:

Q(t) = URR / [1 + EXP (a(Tpeak-t))]

Q(t) is the cumulative oil production up to year t, URR is the ultimately recoverable oil resources, EXP represents the natural exponential function with the Euler’s number “e” being the base, “a” indicates the intrinsic growth rate of the logistic function, Tpeak is the year of peak oil production, and “t” is the current year.

If one takes the derivative of the above equation with respect to “t”, the above equation can be reduced to: dQ/dt = aQ(1-Q/URR) Replace dQ/dt with P (current annual production) and divide both sides by Q:

P/Q = a – (a/URR) Q

If one uses historical data to conduct a linear regression of P/Q over Q, one can solve the two parameters: “a” and “a/URR”. URR (the ultimately recoverable resources) would be solved accordingly. The peak year could in turn be solved.

If one has historical data, Hubbert Linearization is relatively simple and straightforward. But the method has important limitations. Most importantly, it cannot predict future technical changes that will change the amount of recoverable resources. In many cases, the results of Hubbert Linearization are sensitive to the time period used for regressions. The selection of time period often depends on subjective interpretation of available data.

Nevertheless, Hubbert Linearization does reflect the outcomes of historical interactions of geological, economic, geopolitical, and technical factors as well as their evolving trends. When used carefully in combination with other available information, it can provide useful insights into the future trajectory of world oil production.

The World’s Largest Oil Producers

This paper uses BP’s definition of oil production, which defines “oil” as the sum of crude oil and natural gas liquids. The data are mostly from BP Statistical Review of World Energy, extended to 2013 using EIA’s International Energy Statistics.

By this measure, the world’s eleven largest oil producers in 2013 (ranked by their oil production) were Saudi Arabia, Russia, United States, China, Canada, Iran, Iraq, United Arab Emirates, Kuwait, Mexico, and Venezuela.

In this paper, all oil production statistics are stated in million tons. For a rough conversion, 50 million tons of annual oil production roughly equals 1 million barrels of daily production.

Figure 1
pefig/

Figure 1 shows the oil production of the eleven top producers as well as the rest of the world. From 2005 to 2013, the world’s total oil production increased by 192 million tons. Saudi Arabia’s oil production increased by 19 million tons, the Russian oil production increased by 57 million tons, the US oil production increased by 139 million tons, China’s oil production increased by 28 million tons, Canada’s oil production increased by 52 million tons, Iran’s oil production fell by 40 million tons, Iraq’s oil production increased by 66 million tons, the UAE oil production increased by 19 million tons, Kuwait’s oil production increased by 23 million tons, the Mexican oil production fell by 44 million tons, Venezuela’s oil production fell by 30 million tons, and the entire rest of the world’s oil production fell by 97 million tons.
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