By
Jeremy Leggett / The Independent
A
spectre is haunting Europe - the spectre of an acute, civilisation-changing
energy crisis. The latest wobble over disruptions to gas supplies
from Russia is merely the latest in a series of reminders of
how dependent our economies are on growing supplies of oil and
gas. On Wednesday, Gazprom's deputy chairman was in London reassuring
Britain that there would be no risk of disruption to British
gas supplies in the fall-out from the ongoing spat between Russia
and Ukraine over pricing. The very next day, temperatures in
Moscow broke a 50-year record, plunging to minus 30C. Gas normally
exported was diverted to the home front. Supplies to the West
fell.
In December, Sir Digby Jones, director-general of the CBI, warned
that any shortfall in gas could cause disaster for British industry.
The problem, he said, was the likelihood - as forecast by the
Met Office - of a particularly cold British winter. This would
mean more gas burning in homes and power plants than our liberalised
energy market - or its infrastructure - might be able to supply.
There aren't enough pipelines from the continent to carry the
imported gas that we need now that our North Sea production
is dropping. Tankers that are supposed to be bringing liquefied
natural gas (LNG) to the UK are instead following market forces
and going to the US, where gas prices have rocketed even higher
than they have here. Meanwhile, not enough gas has been stockpiled,
because market forces don't favour that kind of thing in relatively
warm years.
We shouldn't panic, insisted energy minister Malcolm Wicks,
because British Gas is being very grown up about it, and anyway
all this will be sorted out by 2007 when a new pipeline and
more LNG plants come on stream. Sceptics pointed out that our
gas reserves were down to 11 days, compared with an average
of 55 on the Continent. That was before the concerns about Russian
supplies. If the thermometers fall in the UK it is still quite
possible that UK firms may have to stop using gas for one day
a week, or even that the suppliers will also have to introduce
rolling power cuts by postcode.
Meanwhile,
domestic gas bills, which rose by more than a third last year,
are expected to rise even higher in the next few months. For
many people, such fluctuations have lethal implications. Last
winter, there were some 35,000 "excess winter deaths"
in the UK, most of them attributable to old people not being
able to keep warm enough; and last winter was a relatively mild
one.
All this concerns gas, of which there are undoubtedly huge proved
reserves left in the ground (even if half of them are in Russia
and Iran). Consider oil. The geopolitical risks are the same.
Only last week Iran threatened to retaliate by cutting oil supplies
if Europe continued to meddle in what it sees as its right to
develop a nuclear programme. Where oil differs from gas is that
a debate is fast emerging about whether we have enough reserves
to meet needs in the short term - even if geopolitics don't
kick in and the current infrastructure keeps working as it should.
At the annual summit of the Organisation of the Petroleum Exporting
Countries (Opec) in December, Kuwait told the world that, without
urgent outside help, it could not continue to pump oil at its
customary rate.
The Kuwaiti oil minister invited Western oil companies back
into his country to see if they could do better. The very next
day the US government quietly slashed 11 million barrels a day
(that's equivalent to the entire daily output of Saudi Arabia)
from its forecast of oil production levels for 2025.
To
most people who noticed them, such announcements will have seemed
remote and academic. In fact, as I shall attempt to explain,
they represent the tip of a very big iceberg indeed: one that
holds the potential to sink the global economy.
We
have allowed oil to become vital to virtually everything we
do. Ninety per cent of all our transportation, whether by land,
air or sea, is fuelled by oil. Ninety-five per cent of all goods
in shops involve the use of oil. Ninety-five per cent of all
our food products require oil use. Just to farm a single cow
and deliver it to market requires six barrels of oil, enough
to drive a car from New York to Los Angeles. The world consumes
more than 80 million barrels of oil a day, 29 billion barrels
a year, at the time of writing. This figure is rising fast,
as it has done for decades. The almost universal expectation
is that it will keep doing so for years to come. The US government
assumes that global demand will grow to around 120 million barrels
a day, 43 billion barrels a year, by 2025. Few question the
feasibility of this requirement, or the oil industry's ability
to meet it.
They
should, because the oil industry won't come close to producing
120 million barrels a day; nor, for reasons that I will discuss
later, is there any prospect of the shortfall being taken up
by gas. In other words, the most basic of the foundations of
our assumptions of future economic wellbeing is rotten. Our
society is in a state of collective denial that has no precedent
in history, in terms of its scale and implications.
Of
the current global demand for oil, America consumes a quarter.
Because domestic oil production has been falling steadily for
35 years, with demand rising equally steadily, America's relative
share is set to grow, and with it her imports of oil. Of America's
current daily consumption of 20 million barrels, 5 million are
imported from the Middle East, where almost two-thirds of the
world's oil reserves lie in a region of especially intense and
long-lived conflicts.
Every day, 15 million barrels pass in tankers through the narrow
Straits of Hormuz, in the troubled waters between Saudi Arabia
and Iran. The US government could wipe out the need for all
their 5 million barrels, and staunch the flow of much blood
in the process, by requiring its domestic automobile industry
to increase the fuel efficiency of autos and light trucks by
a mere 2.7 miles per gallon. But instead it allows General Motors
and the rest to build ever more oil-profligate vehicles. Some
sports utility vehicles (SUVs) average just four miles per gallon.
The SUV market share in the US was 2 per cent in 1975.
By 2003 it was 24 per cent. In consequence, average US vehicle
fuel efficiency fell between 1987 and 2001, from 26.2 to 24.4
miles per gallon. This at a time when other countries were producing
cars capable of up to 60 miles per gallon.
Most US presidents since the Second World War have ordered military
action of some sort in the Middle East. American leaders may
prefer to dress their military entanglements east of Suez in
the rhetoric of democracy-building, but the long-running strategic
theme is obvious. It was stated most clearly, paradoxically,
by the most liberal of them. In 1980 Jimmy Carter declared access
to the Persian Gulf a national interest to be protected "by
any means necessary, including military force". This the
US has been doing ever since, clocking up a bill measured in
the hundreds of billions of dollars, and counting.
With such a strategy comes a disquieting descent into moral
ambiguity, at least in the minds of something approaching half
the country. The nation that gave the world such landmarks in
the annals of democracy as the Marshall Plan is forced by deepening
oil dependency into a foreign-policy maze that involves arming
some despotic regimes, bombing others, and scrabbling for reasons
to make the whole construct hang together.
America is not alone in her addiction and her dilemmas. The
motorways of Europe now extend from Clydeside to Calabria, Lisbon
to Lithuania. Agricultural produce that could have been grown
for local consumption rides along these arteries the length
and breadth of the European Union. The Chinese attempt to emulate
this model even as they enforce production downtime in factories
because of diesel shortages and despair that their vast national
acreage seems to play host to so little oil.
There
is a similar picture with gas. The scale of the addiction -
and of the resource - is smaller. But the patterns are the same:
growing demand for a finite resource, most of which has to be
imported from the Middle East and the former Soviet Union. Even
a temporary blip in supply, such as occurred in Europe this
week, is enough to create something close to panic among governments.
But it is oil that keeps our civilisation functioning.
This
half-century of deepening oil dependency would be difficult
to understand even if oil were known to be in endless supply.
But what makes the depth of the current global addiction especially
bewildering is that, for the entire time we have been sliding
into the trap, we have known that oil is in fact in limited
supply. At current rates of use, the global tank is going to
run too low to fuel the growing demand sooner rather than later
this century. This is not a controversial statement. It is just
a question of when.
Oil
is a finite resource, and there will come a day, inevitably,
when we reach the highest amount of oil that can ever be pumped.
Beyond that day - which we can think of as the topping point,
or "peak oil" as it is often called - will lie a progressive
overall decline in production. Putting the same question a different
way, then, at the current prodigious global demand levels, where
does oil's topping point lie?
This
is a question, I contend, that will come to dominate the affairs
of nations before this first decade of the new century is out.
Already,
a battle is raging, largely behind the scenes, about when we
reach the topping point, and what will happen when we do. In
one camp, those I shall call the "late toppers", are
the people who tell us that 2 trillion barrels of oil or more
remain to be exploited in oil reserves and reasonably expectable
future discoveries. This camp includes almost all oil companies,
governments and their agencies, most financial analysts, and
most business journalists. As you might expect, given this line-up,
the late toppers hold the ascendancy in the argument as things
stand.
In
the other camp are a group of dissident experts, whom I shall
call the "early toppers". They are mostly people who
- like me - have worked in the heart of the oil industry, the
majority of them geologists, many of them members of an umbrella
organisation called the Association for the Study of Peak Oil
(ASPO). They are joined by a small but growing number of analysts
and journalists. The early toppers reckon that 1 trillion barrels
of oil, or less, are left.
In
a society that has allowed its economies to become geared almost
inextricably to growing supplies of cheap oil, the difference
between 1 and 2 trillion barrels is seismic. It is roughly the
difference between a full Lake Geneva and a half-full one, were
that lake full of oil and not water. If 2 trillion barrels of
oil or more indeed remain, the topping point lies far away in
the 2030s. The "growing" and "cheap" parts
of the oil-supply equation are feasible until then, at least
in principle, and we have enough time to bring in the alternatives
to oil. If only 1 trillion barrels remain, however, the topping
point will arrive some time soon, and certainly before this
decade is out. The "growing" and "cheap"
parts of the oil-supply equation become impossible, and there
probably isn't even enough time to make a sustainable transition
to alternatives.
Should
the early toppers be right, recent history provides clear signposts
to what would happen. There have been five price peaks since
1965, all of them followed by economic recessions of varying
severity: after the 1973 Yom Kippur War; in 1979-80 after the
Iranian revolution and the outbreak of the Iran-Iraq war; in
1990, with the first Gulf War; in 1997, with the Asian financial
crisis; and in 2000, with the dot.com collapse. The most intense
peaks were the first two. In 1973, the oil price more than doubled,
reaching around $35 per barrel in modern value. The cause was
an embargo by Opec, led by Saudi Arabia, and triggered through
overt American support for Israel at the time of the Yom Kippur
War. World oil supplies fell only 9 per cent, and the crisis
lasted only for a few months, but the effect was simple and
memorable for those who lived through it: widespread panic.
The
embargo was short-lived, largely because the Saudis feared that
if they kept it up they would create a global depression that
would cripple Western economies, and hence their own. As it
was, the short embargo created an economic recession. I spent
much of it doing my homework by candlelight. I didn't see much
of my father. He was queuing for petrol.
The
second, and worst, oil shock was triggered by the toppling of
the Shah of Iran in 1979, and prolonged by the outbreak of the
Iran-Iraq War in 1980. The first shock did not push prices as
high as those at the time of writing, but the second shock pushed
them to more than $80 a barrel in today's terms. Again panic
reigned, even though the interruption to global supplies was
only four per cent.
The
crisis ended in 1981 when the price fell for three main reasons.
First, the Saudis opened their taps. With their huge reserves,
mostly discovered in the 1940s and 1950s, they were able to
act as a "swing producer", increasing the flow to
bring prices down just as they had decreased it in 1973 to push
prices up. Second, new oil came onstream from giant oilfields
in more stable regions of the globe, including the North Sea.
Third, large amounts of oil were released from government and
corporate stockpiles.
These
three reasons are high on the list of why we should worry today,
because in the face of another shock things could not be resolved
in a similar way. First, there are grounds to worry that the
Saudis are pumping at or near their peak, no longer able to
act as a swing producer. Second, the early toppers fear that
there are no more giant oilfields left to find, much less wholly
new oil provinces like the North Sea. Third, there is not much
oil in storage, relative to current demand. The modern world
works on the principle of just-in-time delivery (another factor
in the short-term crisis facing Britain this winter). Our economies,
overall, are more efficient in their use of oil than in the
1970s - a point much emphasised by late toppers - but the sheer
weight of demand is much higher today, and it is still growing
without an end in sight, or even strong governmental or corporate
leadership demands that there should be one.
The
cost of extracting a barrel of oil from the ground doesn't change
much. A good rule of thumb might be $5 a barrel today, though
obviously there are variations between oilfields in different
geographic and political settings. What influences the price
of oil most is confidence in supply and demand among oil traders.
Oil prices are already at their second highest levels ever,
in real terms, at the time of writing. Some pundits now profess
that they will soon reach their highest ever levels, in modern
value. This situation has arisen for many reasons - but these
do not include the fear that the oil-production topping point
is near. Early-topper arguments are not on the radar screens
of the oil traders and analysts, as things stand. Should that
happen, and should the mood of the packs on the trading floors
flip to the view that we live no longer in a world of growing
supplies of oil, but rather shrinking ones, the price will soar
north of $100 a barrel very quickly.
An
investor friend of mine has already concluded that this scenario
is inevitable. He has switched his investment portfolio to anticipate
the moment of "market realisation". This peak panic
point, as he calls it, will not be limited to oil traders. The
worlds of economics and business routinely assume a future in
which oil is in growing and cheap supply.
Economists tend to assume that their "price mechanism"
will apply. Higher prices will lead to more attractive conditions
for exploration. This will lead to more oil being found, and
the inevitable discoveries will bring the price down until the
next cycle. Massive corporations write five-year plans based
on assumed access to cheap oil and gas. Think, for example,
how important such access must be to a chemical company dealing
in plastics derived from oil. Or a food-processing company reliant
on oil for every stage of food transportation, including of
perishable final products, plus almost all the bottling and
packaging and many of the preservatives and additives.
But
suppose the economists and corporate planners are wrong? Imagine
the collapse of confidence when a critical mass of financial
analysts, across the full breadth of sectors in a stock exchange,
conclude that they are wrong?
If
the topping point is indeed imminent, economic depression looms
as a real prospect. The Saudis were right to be scared of this
possibility in the 1970s. In the Great Depression of the 1930s,
triggered in 1929 by the worst-ever stock-market crash, economic
hardship was horrific. World trade fell by a breathtaking 62
per cent between 1929 and 1932. The widespread unemployment
and social unrest bred Fascism in many countries, in some nations
on a scale that would change the course of history. As for the
stock markets, it took them 50 years to regain their pre-collapse
value in real terms.
There
are so many things to worry about in the fall-out from a premature
peak in oil production. Here is one that gives me particular
nightmares. When I and some of the oil-supply whistleblowers
addressed a conference on oil depletion in the formerly oil-rich
nation known as Scotland last year, five leaders of the British
National Party sat in the audience. They said nothing. They
just listened, and learnt, and no doubt reflected that the far
right does well in tough times.
The stakes are high with energy policy. Higher than most people
dream of when they flip a light switch.
The
question of how much oil is left actually breaks down into three
sub-questions. First, the existing-reserves question: how much
oil is there in discovered oilfields, mapped out, proved and
ready to be exploited? Second, the reserves-addition question:
how much oil remains to be added via new discoveries, enhanced
recovery techniques and so called unconventional oil? Finally,
the speed-to-market question: how fast can the oil, once found,
be delivered to fuel tanks?
One also needs to consider these questions both in relation
not only to conventional oil - that is, liquid that sits underground
in a reservoir under pressure - but also unconventional oil
(which consists of sands and shales containing solidified oil
or solid tar or bitumen deposits; is mostly found in Canada,
the United States and Venezuela; and carries considerable environmental
extraction costs). The same applies, strictly speaking, to deep
water oil (much-hyped by Exxon a few years ago but already widely
thought to have peaked) and gas, whose patterns of availability
tend to mirror those of oil, and which already faces its own
problems of increasing consumption (gas demand is expected to
double by 2030, reaching 4.3 billion tonnes of oil equivalent
a year, of which over 40 per cent will be used for power generation).
I find it hard to feel optimistic about any of the answers.
I
say this as someone who, for most of the 1980s, was a creature
of Big Oil. I taught petroleum engineers and geologists at the
grandiose-sounding but in fact quite tatty Royal School of Mines,
part of Imperial College of Science and Technology in London.
My researches on the history of the planet included such issues
as the source of oil, and was funded by BP and Shell, among
others. I also consulted for oil companies. In those days, I
was psychologically insulated in a quest for the respect of
my peer group, and highly selective as a consequence with the
information I allowed on to my radar screen. The build-up of
greenhouse gases (a separate but scarcely less urgent reason
for worrying about our dependence on oil) registered nowhere
on my list of concerns. I had concerns about oil depletion,
but only in the sense that this cloaked my quest to find more
with a certain nobility, at least in my own eyes.
But
one thing that was clear to me even then was that most of the
planet has not a drop of drillable oil. Almost everywhere geologists
have looked - which means everywhere by now, at least at some
level of exploration - there is no oil because one or more of
the key geological requirements is missing. Even when all the
boxes can be ticked, you can end up finding no oil. Only one
well drilled in every 10 finds oil. Only one in a hundred finds
an important oilfield. And the more wells that are drilled in
a province or country, the smaller the oilfields generally tend
to become.
In
my book, Half Gone, I examine in detail the prospects of future
viability for each of the major sources described above. But
one of the most important arguments against over-confidence
in future reserves can be summarised simply.
Think
of all that expertise that had been built up since the first
oil was drilled in 1859. Think of all the trillions of dollars
in oil revenues stacked up in the 20th century, and all the
hundreds of billions spent on exploration and the hi-tech toys
of exploration in the half-century since the biggest Saudi and
Kuwait fields were discovered. Think of the sophistication of
the seismic reflection profiling offshore. Consider the all-important
oil source rocks, and how relatively limited they are in distribution.
As BP's former reserves co-ordinator, Francis Harper, told the
Energy Institute in November 2004: "We know how many world
class source-rocks there are, and where they are." Wouldn't
it be reasonable to think that with modern technology at least
one more field of more than 80 billion barrels might have been
found somewhere, in all the places the companies have looked
these last 50 years?
The third-biggest oilfield in the world is Samotlor, discovered
in 1961, with 20 billion barrels. The fourth-biggest is Safaniya,
discovered in 1951, at which time it also supposedly contained
20 billion barrels. The fifth-biggest is Lagunillas, discovered
in 1926, containing 14 billion barrels. Only around 50 super-giant
oilfields have ever been found, and the most recent, in 2000,
was the first in 25 years: the problematically acidic 9-12 billion
barrel Kashagan field in Kazakhstan.
Let
us reduce our scale of scrutiny from the super-giant to the
merely giant. Half the world's oil lies in its 100 largest fields,
and all of these hold 2 billion barrels or more, and almost
all of them were discovered more than a quarter of a century
ago. Consider the recent record of discoveries of giant oil-
and gas-fields of over 500 million barrels of oil or oil equivalent.
Half a billion barrels - the definition of a "giant"
field - sounds a lot. But since the world is eating up more
than 80 million barrels of oil a day at the moment, it is in
fact less than a week's global supply. In 2000 there were 16
discoveries of 500 million barrels of oil equivalent or bigger.
In 2001 there were nine. In 2002 there were just two. In 2003
there were none.
On
the basis of this kind of evidence, is the industry going to
meet the steady increase in demand with new discoveries? Francis
Harper, for one, doesn't seem to think so. "Worldwide,
the frequency of finding giant oil provinces and super-giant
oilfields has been declining for decades and will not be reversed,"
he told an agog audience at a November 2004 London conference
on oil depletion held in the Energy Institute. "We've looked
around the world many times. I'd say there is no North Sea out
there. There certainly isn't a Saudi Arabia."
In January 2004, the early toppers' case suddenly looked a good
deal more worryingly feasible to those who have tended to take
the late toppers at face value. Shell's then chairman, Sir Philip
Watts, told investors that the company had overestimated its
reserves by more than 20 per cent. By March, internal e-mails
had been requisitioned by lawyers and these made it clear that
the chairman and his head of exploration had known about this
problem for some time, and had deliberately lied about it. Both
men departed the scene.
Shell's
corporate scandal is dramatic enough. But there is a clear risk
that it is only the tip of an iceberg. Today, many people in
the oil industry appear to be under pressure when it comes to
supplies of oil. "There is something strange going on in
this industry," Shell's replacement boss, CEO Jeroen van
der Veer, told the press in November 2004. He suspects that
other companies have the same problems he inherited. The Economist
drew the following conclusion: "Industry analysts and investors
are quietly saying that Mr van der Veer may be right, and another
big reserves scandal may be brewing somewhere."
Against
this unpromising start, how much oil do we think the oil companies
have found to date? Call BP for a bit of help with the answer
and you'll be sent their annual BP Statistical Review of World
Energy. In it, you'll see lists of data for national proven
oil reserves. Add these up to a global total of oil reserves
year by year, and you'll see the total creep reassuringly upwards
over time. The chart on page seven shows those figures, from
successive annual reviews split into the Middle East and the
rest of the world. Global reserves rise from just over 600 billion
barrels in 1970 to almost double that today: 1,147 billion barrels
at the last count, up to and including 2003.
So
what's the problem? The first hint that something might be amiss
comes, as is so often the case in life, in the small print.
Squinting through a lens if you have anything but perfect eyesight,
you will find that the data in BP's own report are not BP's
at all. The estimates have been compiled using "a variety
of primary official sources, third-party data from the Opec
Secretariat", and a few other places completely removed
from BP's headquarters in St James's Square with all its accumulated
research and knowledge. Think how many libraries of understanding
BP must have gathered in over a century of aggressive oil exploration
and production all over the world. And yet all they offer us
as a guide to our own understanding of how much "proved"
oil reserves there are left on the planet is a compilation of
other people's data. And much of that itself is secondhand.
After
this revelation comes another. The small print continues: "The
reserves figures shown do not necessarily meet the United States
Securities and Exchange Commission definitions and guidelines
for determining proved reserves, nor necessarily represent BP's
view of proved reserves by country."
They
don't even believe the figures they are publishing! Referee!
This is a publication used as an energy bible by researchers
the world over. Students quote it as whole truth in undergraduate
essays. Journalists quote it as gospel in legions of articles.
They don't insert caveats like this. Neither have they seen
such caveats in earlier reports.
You might end up with a few questions for the authors of the
BP Review at this point. But then, at the end of the document,
we read the following: "BP regrets it is unable to deal
with enquiries about the data in the Statistical Review of World
Energy."
So
what is BP's real view of "proved" reserves? Could
it go something like this?
Looking
closer at the chart and zooming in, you'll see that the figures
show that global reserves of oil went up particularly quickly
between 1985 and 1990 (a big black oily arrow indicates the
point). There must have been some big new oilfields discovered
then, right? Wrong. The actual new discoveries in that period
were less than 10 billion barrels. But the Middle East nations
hiked their "proved" reserves from already discovered
oilfields by fully 300 billion barrels collectively in that
period, professing one after another that their national calculations
had all somehow hitherto been too conservative. Three hundred
billion barrels is a lot of oil. It is more than a decade of
demand at current levels.
Here's
how it happened. In the 1950s, the nations with oil organised
themselves into the cartel known as Opec. Opec's main aim was
and is to try and control the price of oil. They don't want
it too low. That would cut their income. Neither do they want
it too high. That might get the addicts thinking of maybe going
elsewhere. They want it just right, perhaps around $30 per barrel
in today's money. To do this they can't produce too much, because
that would flood the market, causing the price to drop. They
have to produce exactly the right amount collectively, and that
means quotas. After much bickering in the early days, the Opec
oil ministers decided in 1982 to allocate a quota to each country
in the cartel according to the size of its reserves.
But in 1985, they began to - how shall I put it? - massage the
data. Kuwait was the first to give in to temptation. They found
that their reserves had gone up overnight from 64 to 90 billion
barrels. In 1988, Abu Dhabi, Dubai, Iran and Iraq all played
the same card. Abu Dhabi had been so needlessly conservative
that their reserves went up from 31 to 92 billion barrels. They
surely must have employed some incompetent geologists. How could
they have overlooked 60 billion barrels? Finally, in 1990, Saudi
Arabia decided it too had been conservative, hiking its total
from 170 to 258 billion barrels.
You can also see in BP's data that the Middle East's reserves
have been almost constant in size since then. What you don't
see in the figure - but do see in the data - is that this is
apparently the case not just for the sum of the reserves of
the Middle Eastern oil producers but also for the figures of
reserves for the individual nations.
Consider
the enormity of this coincidence. It means that the billions
of barrels found in new discoveries each year would have to
match exactly the billions of barrels produced each year in
each of the Middle Eastern OPEC nations, and do so consistently
every year for more than a decade.
BP's
Statistical Review of Everyone's World Energy Statistics Except
Their Own invites us to believe all this without comment from
them or recourse to questions by us. We are left to look at
the total figure they cite for "proved" reserves,
1.1 trillion barrels, and think to ourselves ... "Er, really?"
The
early toppers have a different view. Being in most cases old
hands from the oil industry, they know a thing or two about
the games that go on in their industry. They estimate the total
of proved reserves to be 780 billion barrels, some 300 billion
barrels short of "BP's" figures. This is less than
the world has produced since the first oil was struck over a
century ago: 920 billion barrels by the end of 2003 (a figure
about which there is somewhat less controversy).
Let
us take some opinions that ought to be difficult to discount,
one from the top of the oil tree in the US and two from the
Middle East. The Houston-based energy investment banker Matthew
Simmons has been one of George W Bush's energy advisers. He
has studied reports by Saudi engineers showing that pressure
is dropping in Saudi oilfields. The four biggest fields (Ghawar,
Safaniyah, Hanifa, and Khafji) are all more than 50 years old,
having produced almost all Saudi oil in the past half-century.
These days, Simmons says, they have to be kept flowing largely
by injection of water. This is of explosive significance, he
argues. "We could be on the verge of seeing a collapse
of 30 or 40 per cent of their production in the imminent future.
And imminent means some time in the next three to five years
- but it could even be tomorrow."
The
Saudis dismiss this, claiming that they have slightly more than
the 258 billion barrels of "proved" reserves they
claimed they had in 1970, with lots more yet to be found, and
that they can lift the current extraction rate of around 9.5
million barrels a day to more than 10 with little difficulty.
As Nansen Saleri, Manager of Reservoir Management at Saudi Aramco,
puts it: "... we have lots of oil, not only for our grandchildren
but for the grandchildren of our grandchildren."
Saudi Aramco has the largest reserves of all the oil companies
in the world: 20 times the size of ExxonMobil's, if they indeed
have 260 billion barrels. They also have the lowest discovery
and development costs, some 50 cents per barrel, or 10 per cent
of what the private companies pay in Russia or the Gulf of Mexico.
And, being state-run, without much need for debt, they are under
no pressure to divulge much to the financial markets.
Lately,
in the face of concerns about their ability to ramp up production,
they have been marginally more open. They say they can maintain
spare capacity of 1.5 to 2 million barrels per day and would
be content with a fair price of $32-$34 a barrel. Aramco's geologists
have insisted they can hike output to 15 million barrels a day
(adding more than 5 million to the 9.5 million reported today);
5 million of which come from the giant Ghawar field alone. Contractors
report that drilling activity is increasing, as it needs to,
given the age of the fields.
But consider what A M Samsam Bakhtiari of the National Iranian
Oil Company (NIOC) has told the Oil & Gas Journal about
the existing-reserves question: "I know from experience
how 'reserves' are estimated in major Middle Eastern and Opec
countries, and the methods used are usually far from scientific,
as the basic knowledge for such a complex exercise is not to
hand." Bakhtiari is withering about Saudi Arabia's reserves
hike of 90 billion barrels in 1990. But he is not too keen on
his own national figures either. The BP Statistical Review cited
92 billion barrels of "proved" oil reserves at the
end of 1993, but Bakhtiari preferred the estimate of a retired
NIOC expert, Dr Ali Muhammed Saidi, who could add the proved
reserves up to only 37 billion barrels.
Dr
Mamdouh Salameh, a consultant on oil to the World Bank, agrees
there is a 300-billion-barrel exaggeration in Opec's reserves.
More recently, a former director of Aramco has said that Saudi
Arabia's proved developed reserves stand at 130 billion barrels.
An anonymous informer talking to Dr Colin Campbell of the Association
for the Study of Peak Oil goes further. His conclusion is that
Saudi Arabia would have gone over its peak of production in
the last quarter of 2004. This person speaks with front-line
inside knowledge. "Saudi has at various times put 19 fields
into production," he says. "Of these, eight are 'stars',
being highly productive fields that produce around 90 per cent
of the country's production. All the others are 'dogs' that
have never worked well and probably never will. Recovery rates
of up to 50 per cent may be appropriate for the 'stars'. For
the 'dogs', 10, 15 or 20 per cent would be more appropriate.
Make this adjustment and Saudi has depleted more than 50 per
cent of its realistically recoverable reserves."
In
February 2005, Matthew Simmons speculated that the Saudis may
have damaged their giant oilfields by over-producing them in
the past: a geological phenomenon known as "rate sensitivity".
In oilfields where the oil is pumped too hard, the structure
of the oil reservoir can be impaired. In bad cases, most of
a field's oil can be left stranded below ground, essentially
unextractable. "If Saudi Arabia has damaged its fields,
accidentally or not," Simmons said, "then we may already
have passed peak oil."
Is
there any chance that the early topping point of oil production
is somehow wrong, all just a bad dream? I am sorry to say that
I think not. It is important to realise that the early toppers
are not advocates or agitators by choice.
They tend to have high residual affection for the industry they
have spent their lives in. Colin Campbell, for example, the
founder of the Association for the Study of Peak Oil (ASPO),
worked for 40 years in the oil industry before retiring to western
Ireland. Chris Skrebowski, the editor of Petroleum Review, a
leading trade journal of the oil industry, spent nearly a decade
arguing against Campbell before conceding that he was right.
"In 1995 it all seemed pretty fantastic," says Skrebowski.
"I tried hard to prove him wrong. I have failed for nine
years. I am now with him. In fact, I think he's a bit of an
optimist." Other early-toppers include Richard Hardman,
former chief executive of Amerada Hess; Roger Bentley, formerly
of Imperial Oil in Canada; and Roger Booth, who spent his professional
life at Shell, and who now believes that, when the peak does
hit: "A crash of 1929 proportions is not improbable."
Chris
Skrebowski believes that, from as early as 2007, the volumes
of new oil production are likely to fall short of the combined
need to replace lost capacity from depleting older fields and
to satisfy continued growth in demand. In fact, given the time
frames with which offshore oilfields are developed and depleted,
it seems certain that there will be nowhere near enough oil
to meet the combined forces of depletion and demand between
2008 and 2012. If there were, it would be from projects we would
know about today (oil companies liking as they do to boast to
their shareholders about every sizeable discovery). Given the
inevitable time-lag from discovery to production, there is now
no way to plug that gap.
There
is worse: people in the oil industry must know this. They should
be alerting governments and consumers to the inevitability of
an energy crunch, and they aren't.
In
July 2004, Campbell and Skrebowski tried to carry their warning
jointly to the UK parliament. In the Thatcher Room they delivered
a seminar to a pitifully thin audience, including only three
MPs and a handful of researchers. I sat there listening to it
with as surreal a feeling as I have ever experienced in all
my years working on energy. Over the course of a decade at and
around the climate negotiations, I have rarely been able to
claim that the global warming problem is not reaching the ears
it needs to. The same can manifestly not be said about the oil-depletion
problem. This is the starting point for any analysis of how
serious the problem is. How can evidence so compelling go almost
unheard in one of the world's centres of government, even with
a suspiciously high oil price at the time and so much obvious
oil-related trouble brewing in the Middle East?
Having built their cases, the two spelt out the consequences
of the early topping point. "The perception of looming
decline may be worse than the decline itself," Campbell
said. "There will be panic. The market overreacts to even
small imbalances. Prices are set to soar in the absence of spare
capacity until demand is cut by recessions. We will enter a
volatile epoch of price shocks and recessions in increasingly
vicious circles. A stock-market crash is inevitable."
"If the economic recovery continues," Skrebowski added,
"supply will get very tight from 2008 or 2009. Prices will
soar. There is very little time and lots of heads are in the
sand."
In
1956, a Shell geologist called M King Hubbert famously calculated
that oil production in the "lower 48" states of America
would peak in 1971. Almost nobody believed him. Shell censored
the written version of Hubbert's address to the American Petroleum
Institute, changing the wording of his conclusion to read that
"the culmination should occur within the next few decades".
The US Geological Survey, in particular, did everything it could
to hike the estimates of ultimately recoverable American oil
to a level that would make the problem go away. The US had 590
billion barrels of recoverable oil, the survey said, in 1961,
meaning that the industry had 30 years of growth to look forward
to.
The years went by and the "lower 48" did indeed hit
their topping point. It came a year ahead of estimate, in 1970,
at 3.5 billion barrels. Since then, production has sunk down
the second half of the curve at a steady rate. Many billions
of dollars have been spent on ever more sophisticated exploration,
including in areas where nobody imagined oil would be found
at the peak of discovery in the 1930s, such as the deep water
in the Gulf of Mexico. A frenzy of new domestic exploration
began after the first Arab embargo in 1973 and the realisation
that domestic production could be ramped up no more. Every enhanced
production technique invented has been tried and tested in American
oilfields. But it has all made no difference to the remarkable
symmetry of the up-and-down curve that expressed Hubbert's thinking.
The US is just short of halfway down the second half of the
curve now. In other words, it has used up some three-quarters
of its original endowment of recoverable oil. Given its almost
total lack of attention to the efficiency with which oil is
burned, the US becomes more dependent on foreign oil imports
by the day.
The US Secretary of the Interior at the time, Stewart Udall,
later apologised for having helped lull Americans into a "dangerous
overconfidence" by accepting the advice of the US Geological
Survey so unquestioningly. A long-serving US Geological Survey
director who had led the campaign against Hubbert, V E McKelvey,
was forced to resign in 1977.
We
need to remember this sequence of events, and the windows it
gives us into individual and collective behaviour, when we come
to consider the global oil topping point.
The
American pattern of historical oil discovery and production
is only a loose guide to what is going on in the rest of the
world. In the US, oil, once found, was pumped without much substantive
effort at constraint. The curves for discovery and production
are going to look different where conservative nationalised
companies are doing the looking, or where - as in the case of
Saudi Arabia - there has been so much oil that the taps can
be turned up and down for long periods so as to moderate supply
and thus influence price.
Countries that have onshore and offshore oil can have two curves,
because the technology for offshore oil exploitation was developed
much later than that for onshore. Curves will also be disrupted
by wars, big political events, even accidents. None the less,
country after country follows a crude bell curve - like Hubbert's
curve - in both discovery and production. Today, more than 60
out of the 65 countries possessing oil have passed their discovery
topping points and 49 of them have passed their production topping
points. The US has a particularly long gap between the two:
40 years (1930 to 1970). The UK has one of the shortest: 25
years (1974 to 1999). This is because the first discoveries
were made much later in the UK, when technology for both exploration
and production were more advanced. Growing supplies of British
oil didn't last long, though. Britain is now a net oil importer
just like the US.
Nor is there any comfort to be derived from gas. Gasfields deplete
very differently from oilfields, gas being much more mobile
than oil. It is normal for a gasfield to yield 70-80 per cent
of its gas over its production lifetime, whereas an oilfield
will typically yield only 35-40 per cent of its oil. Drillers
normally set gas production far below the natural production
capacity so as to give a long production plateau. But the danger
in this is that the end of the production plateau comes abruptly,
and without market signals.
Colin
Campbell, a prominent early topper, estimates that the original
global endowment of conventional gas was around 10,000 trillion
cubic feet (equivalent to 1.8 trillion barrels of oil), of which
about a quarter has been produced to date. He expects a global
plateau in production of around 130 trillion cubic feet per
year during the period 2015 to 2040, with production falling
over a cliff beyond that. Jean Laherrère forecasts 12,000
trillion cubic feet for all gas including unconventional sources
(2 trillion barrels of oil equivalent). He puts the peak of
gas depletion in 2030, at 130 trillion cubic feet per year.
But the exact figures need not concern us. What matters is that
gas has all the same problems of dependence on overseas supplies
as oil, and more besides.
Meanwhile,
the five essential facts about global oil discovery can be summarised
as follows.
1. The biggest oilfields in the world were discovered more than
half a century ago, either side of the Second World War.
The big discoveries on the Arabian Peninsula opened with the
discovery of the Greater Burgan field in Kuwait in 1938. At
that time, it supposedly held 87 billion barrels. The slightly
bigger Saudi Arabian Ghawar field, supposedly holding 87.5 billion
barrels before extraction started, followed in 1948. These fields,
the two biggest in the world, are so big that they dominate
the global figures in their years of discovery.
2. The peak of oil discovery was as long ago as 1965.
How many people appreciate this? I invite you to do a bit of
personal market research. Line up ten of your better-educated
friends. Preface your question to them with a few reminders
about how many millions of dollars the oil companies make in
daily profit, tell them, if you can, an anecdote or two about
the technical wizardry they use, and ask them to imagine how
many billions of dollars they must have spent on exploration
over the years - both of the companies' own money and of the
massive tax-deduction subsidies available to them. Then ask:
in what year would you guess the most oil was ever discovered?
3.
There were a few more big discovery years in the 1970s, but
there have been none since then.
The biggest irregularity on the downside of the global discovery
curve involved the discovery of oil in Alaska's giant Prudhoe
Bay field, and the North Sea, in the late 1970s. I was a geology
student then. I remember the thrill as the giant fields were
discovered one after the other. They all had such serious-sounding
names. Forties, Brent, Piper. I look back on those days now
and I see something of the primeval attractions of the hunt
in it. As a junior trainee hunter, I used to listen to the tales
of the senior hunters, and how they had found their quarry,
quite atremble with admiration. However, what I and the other
hunters didn't know was that the days of giant discoveries were
more or less over.
4.
The last year in which we discovered more oil than we consumed
was a quarter of a century ago.
Since then, despite all those generations of eager brainwashed
geology students, we have been burning progressively more, and
finding progressively less. This is another one to try out on
the 10 educated friends.
5.
Since then there has been an overall decline.
A small rise in discoveries in the 1990s that must have looked
promising at the time has dropped in the opening years of the
new century. Does this sound like a world without a looming
oil depletion problem, as portrayed by BP's CEO Lord Browne
- who in March last year insisted "There is no physical
shortage. The resources are there"? Are people are being
lulled into a sense of false security about oil supply based
on his speeches, and publications like the BP Statistical Review
of World Energy? Or are we simply failing to pay sufficient
attention to alarm signals such as last month's little-noticed
announcement by the US government's Energy Information Administration,
in which forecasts of Opec production between now and 2025 were
slashed by 11 million barrels a day?
Let us suppose for a moment that the late toppers are correct.
The topping point, as defined by reserves available in principle,
is off in the 2020s or 2030s, and we can look forward to growing
supplies of relatively cheap oil for a decade or more. There
is another aspect of the problem: whether or not the production
capacity is sufficient.
Oil-industry analyst Michael Smith, who took his PhD in geology
just after me - sitting in the same chair as I did in the research
lab - is an expert in this subject. He has spent most of his
vocational life as an oil-industry geologist working around
the world, particularly in the Middle East. "Reserves are
largely irrelevant to the peak," he says. "Production
capacity is the important thing - how quickly you can get it
out. It is an engineering problem, not a geological problem."
Of the 11 countries in the Middle East, only five are significant
oil producers: Iran, Iraq, Kuwait, Saudi Arabia and the United
Arab Emirates, known sometimes as the Middle East Five. They
produce around 20 million barrels a day today, a quarter of
the global total. If global demand rises at the average rate
of the past 30 years, 1.5 per cent per year, these five countries
will have to meet around two-thirds of the demand, Smith calculates.
Let us assume they can do what they say they can, no more, no
less. Where does that leave us? Saudi Arabia says it can lift
production from 9.5 million barrels per day today to 12 million
by 2016 and 15 million beyond that. This despite 50 per cent
of the oil coming from the Ghawar field, where a water cut is
already reported. Smith sums all the reported capacities in
the Middle East Five and finds that if the rate of demand growth
continues at 1.5 per cent they will fail to meet global demand
by as soon as 2011. If it rises to 2.5 per cent the demand gap
appears in 2008. If it is 3.5 per cent - the rates in China
and the US of late - the gap is already here.
"What's
more," Smith adds, referring back wryly to the starting
assumption, "I do not truly believe the claims of the Middle
East Five. In fact, although I don't believe Saudi and Iranian
claims in particular, I think their politicians do believe them.
I don't think there is a conspiracy, more a division of labour
such that no one knows the whole story, each part of which has
wide error bars. The summed result is inevitably the most positive
conclusion which goes to the politicians. I've seen this in
all the oil companies I have worked for." At the November
2004 conference on oil depletion at the Energy Institute, Michael
Smith showed a slide at the end of his presentation that gave
a pictorial summary of his views. It showed a group of firemen
posing for the camera outside a burning house.
The
investment bank Goldman Sachs drew attention to the problem
of access to oil on a global scale in a much-quoted 2004 report.
"The industry is not running out of oil - reserves are
large and continue to grow," it asserts - though failing
to offer evidence of this analysis. "What the industry
is running out of is the ability to access this oil." Two
decades of chronic underinvestment in the 1980s and 1990s are
responsible. During this time the industry was feasting on reserves
discovered in the 1960s and earlier with infrastructure capitalised
in the 1970s, after the first oil shock. Global oil demand is
now closing fast on tanker capacity and refining capacity. The
peak year for tanker capacity was way back in 1981. So, too,
was the peak for refinery capacity. Global rig counts also peaked
that year.
So,
how much new investment is needed to fix the shortfall? Over
the next 10 years, assuming oil demand increases as commonly
projected, fully $2.4trillion will need to be spent, according
to Goldman Sachs. This is nearly triple the level of capital
investment by the oil industry in the 1990s. And if it isn't
spent? "If the core infrastructure does not improve, energy
crises are likely to become progressively more frequent, more
severe and more disruptive of economic activity," the investment
bank concludes.
Stated
simply, it seems that even if an early topping point doesn't
hit us, the results of two decades of negligence in investment
in infrastructure and exploration will. You need to read between
the lines of the Goldman Sachs report to smell the level of
anguish about this. Even where substantial money has been invested,
a further list of serious unresolved problems can often be quickly
summoned up. Oil in the Caspian is central to every scenario
that envisages oil supply meeting demand off into the 2020s.
The oil industry has long regarded the Baku-Ceyhan pipeline
from Azerbaijan to Turkey as essential if it is to get Caspian
oil out to market without the need to go through Chechnya and
Russia. By the time this pipeline begins to shift oil as planned
in 2005, it will have cost $4bn, almost three-quarters of that
in the form of bank loans. The problems for this pipeline begin
with reports of its construction standard. Four whistleblowers
recently told a UK national newspaper that the pipeline was
failing all international construction standards, including
installation of inadequately welded pipe before it had even
been inspected. It passes through a major earthquake zone. Turkey
has had 17 major shocks in the past 80 years, and the pipeline
is supposed to last for 40 years.
At
the time the pipeline was conceived, industry reports talked
of several hundreds of billions of barrels in the Caspian region.
Now estimates of around 50 billion barrels, about the same as
the North Sea, are more common. After the discovery of the last
of the super-giants, the Kashagan field in 1990, there was a
burst of predictable interest in Kazakhstan. But now, in terrain
where individual wells cost $1bn to drill, in conditions where
only foreign companies have the know-how and technology to drill,
the Kazakh government has introduced new legislation that makes
investment unattractive. As an ExxonMobil executive told Petroleum
Review, "...the jury is still out on whether all these
obstacles will delay Kazakhstan's production".
This example of a real-world current problem for the oil industry
raises the subject of the interplay between the early topping
point and oil geopolitics. As the world's No 1 consumer, the
United States will have much to say about how the crisis - whether
of early depletion or inadequate infrastructure and investment,
or both - plays out. The geopolitics of American oil dependency
is well summarised by Michael Klare in his recent Blood and
Oil. He sees four key trends in US energy behaviour: more imports,
increasingly unstable and unfriendly suppliers, escalating risk
of anti-American violence and rising competition for diminishing
supplies. Imports we have talked about above. Increasingly unfriendly
suppliers and escalating anti-American violence are linked.
The
point here is that the US can have relationships with governments
in unstable countries if it chooses the path of oil dependency,
but not easily with their populations. Terrorism can be expected
to grow with every American act interpretable as imperialistic
in the Middle East and Central Asia. The Iraq-to-Turkey pipeline
illustrates the problem perfectly. It suffered near daily attacks
in 2003.
As
for competition over diminishing supplies, therein lies the
stuff of nightmares. The Pentagon established a Central Command
in 1983, one of five unified commands around the world, with
the clear task of protecting the global flow of petroleum. "Slowly
but surely," Michael Klare concludes, "the US military
is being converted into a global oil-protection service."
At
$30 a barrel, the total bill for imported oil - now more than
half the US daily consumption and rising fast - should reach
$3.5 trillion over the next 25 years, and this does not include
the Pentagon's overhead. Beyond the Middle East Five, the Bush
strategy of supplier diversification will look to eight main
sources, which Klare calls the Alternative Eight: Mexico, Venezuela,
Colombia, Russia, Azerbaijan, Kazakhstan, Nigeria and Angola.
These countries and their oil operations are characterised by
one or more of the following attributes: corruption, organised
crime, civil war, political turmoil short of civil war, and
ruthless dictators. The US military is being forced into deeper
relationships with such regimes, including joint military exercises.
The bottom line for Klare is this. "Any eruption of ethnic
or political violence in these areas could do more than entrap
our forces there. It could lead to a deadly confrontation between
the world's military powers." Because obviously, in a world
as enduringly addicted to oil as ours is, others are going to
be looking for their own supplies. Russia and China will be
among them. As one global-security analyst recently put it:
"I am afraid that over the years we will see China become
more involved in Middle East politics. And they will want to
have access to oil by cutting deals with corrupt dictatorships
in the region, and perhaps providing components of weapons of
mass destruction, ballistic missiles and other things they have
been involved with, and that could definitely put them on a
collision course with the United States." Oil dependency
could yet prove to be the route to a Third World War. The stress
associated with an unforeseen early topping point surely makes
that horrific prospect more, not less, likely.
Humans are good at staying loyal to their theocracies, and a
hundred years of fossil fuel addiction has created impressive
theocracies. However, as Einstein said, you can't solve the
world's problems with the same thinking that created them. We
have to think outside the box. That means giving renewable energy,
alternative fuels, energy efficiency and storage technologies
the space they need to grow explosively.
The good news is that it will be possible to replace oil, gas
and coal completely with a plentiful supply of renewable energy,
and faster than most people think. Shell employs roomfuls of
clever people just to think about the future. They are called
scenario planners. In their 2001 book of scenarios, Shell's
planners mention that renewable energy holds the potential to
power a future world populated with 10 billion people, and do
so with ease. The needs of the 10 billion can be met even in
the unlikely and undesirable event that all of them use energy
at levels well above the average per-capita consumption today
in the EU. The Shell futurists mention this almost in passing,
in the caption of a diagram showing the continent-by-continent
potential for individual renewable-energy technologies to contribute
to such a power-rich future. Working for an oil and gas giant
as they do, it is perhaps no surprise that they fail to explore
a scenario wherein something resembling this renewable-power-rich
future comes to pass. Others are not so constrained.
When
I began my time in Greenpeace, in 1989, the protestations my
colleagues and I made that renewable energy could displace fossil
fuels and run the world were ridiculed by energy experts and
officialdom as naïve wishful thinking. Now, more than a
decade later, such views can be found in the heart of government,
at least in Europe. The Blair Government published a report
in 2003 that concluded: "It would be technologically and
economically feasible to move to a low carbon-emissions path,
and achieve a virtually zero-carbon-energy system in the long
term, if we used energy more efficiently and developed and used
low-carbon technologies."
Among
the low-carbon technologies on offer, the government report
placed heavy emphasis on renewable energy and hydrogen, rather
than nuclear power. Of solar energy, the report concludes: "[It]
alone could meet world energy demand by using less than 1 per
cent of land currently used for agriculture." Tony Blair
used these same words in the speech he gave launching the UK
Energy White Paper. I sat there watching him do it, 10 feet
away in the front row. I was momentarily tempted to leap to
my feet and shout: "So why don't you invest in it like
the Germans and Japanese, then?" But he hasn't. Not then.
Not now.
Microcosms of what could be done can be found already on the
local government scene. Take the small town of Woking. Its borough
council has cut carbon-dioxide emissions by fully 77 per cent
- yes, more than three quarters - since 1990 using a hybrid-energy
system involving small private electricity grids, combined heat
and power (CHP), solar photovoltaics (PV), and energy efficiency.
Woking has turned its town centre, its housing estates, and
its old people's homes into inspirational islands of energy
self-sufficiency. The UK grid could go down for ever, and these
folks would have their own heating and electricity year-round.
The technologies work in perfect harmony. The CHP units generate
heating when needed in winter, and lots of electricity along
with it when the PV is not working at its best. The PV generates
plenty of electricity in the summer, when the heating isn't
needed, meaning the CHP can't generate much electricity. Because
the use of private wires is so much cheaper than using the national
grid, the whole package costs fractionally less than the equivalent
heating and electricity supply would cost from the big energy
suppliers.
Compare such out-of-the-box ingenuity with what nuclear has
to offer. Even if there were no environmental problems associated
with it, and we could afford the billions needed in perpetuity
from the public purse to make the voodoo economics stack up,
a new fleet of stations couldn't come on-stream in the UK much
before 2020. And if we and the Americans can't solve the energy
crisis without resorting to nuclear, the whole world will follow
our example. Bad as the terrorist threat is now, it would be
compounded many times as a result. We would live with much increased
risk of losing whole cities to suitcase bombers.
There is a part of me that looks at the prospect of a cold snap
in Britain this winter, and of a consequent fuel-supply crisis,
and thinks "Bring it on." Maybe this is what we need
to stop our sleepwalk towards catastrophe, and to make us rethink
our energy policy. Perhaps the government can be judo-thrown
into the Wokingisation of Britain now, and dissuaded from the
nuclearisation of Britain 15 years from now.
But
then I think of all the grans and granddads that would die in
a one-in-ten winter, and I just feel sad. Sad, and mad with
our hot-air Government.
Jeremy
Leggett ,
D.Phil in earth sciences at Oxford, is chief executive of solarcentury,
the UK’s largest independent solar electric solutions
company. He is a winner of the US Climate Institute’s
Award for Advancing Understanding as an environmental campaigner
for Greenpeace International. Director of the world’s
first private equity fund for renewable energy, Bank Sarasin’s
New Energies Invest AG, and a member of the UK Government’s
Renewables Advisory Board. Author of The Carbon War, Penguin
in 1999; The Empty Tank in the US, Random House, 2005; his latest
book is Oil, Gas, Hot Air and the Global Energy Crisis, Portobello
Books. Petroleumworld not necessarily share these views.
Editor's Note: This article is adapted from "Half Gone:
Oil, Gas, Hot Air and the Global Energy Crisis", Portobello
Books, and was first publish by The Independent, 21 January,
2006. Petroleumworld reprint this article in the interest of
our readers. Petroleumworld, do not reflect either for or against
the opinion expressed in the comment as an endorsement of Petroleumworld.
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