Dear PAMH members,

Below is the transcript of an interview bicycle advocate friend Bruce
Robinson recently did with ABC radio and as republished at BFA-Oz*.

For those interested- for population health or other purposes- in
promoting bicycling, walking and other non mechanised forms of
transport, I think it could well be useful ammunition to have at hand.

well wishes,

Kate

*(BFA-Oz is a mailing list for people interested in bicycle advocacy at
a state and national level in Australia. It is an initiative of the
Bicycle Federation of Australia (www.bfa.asn.au). To subscribe send
e-mail from that address to bfa-oz-subscribe@...)

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Sunday 02/11/2003

Oil Futures*

Summary:

Argument is intensifying about the future of oil and gas. The question
is not when oil will run out, but when global production will peak and
begin its long decline. An influential group of retired oil industry
geologists who have formed the Association for the Study of Peak Oil and
Gas (ASPO) believe that the crisis is almost upon us.

Details or Transcript:

Terry Lane: A couple of weeks ago in the program, I talked with Colin
Mason about his apocalyptic book The 2030 Spike and we spent some time
talking about oil. The question when production will peak, when it will
go into decline, what will happen when it becomes scarce and expensive
and then finally, what a post-oil economy might look like. Well letters
came, naturally. One simply said that the total extinction of human life
on the planet will be the best thing that has ever happened to it, and
some cheerful optimists wrote reminding me that from Malthus to the Club
of Rome, the doomsayers have always got it wrong - the whole planet is
positively bubbling with oil and we will never run out. Well, who knows?
So we looked around for someone who has looked into the matter of how
much oil is left and we found West Australian scientist Bruce Robinson
and here he is. Bruce, good afternoon.

Bruce Robinson: Hello, how are you?

Terry Lane: Now oil reserves are not the subject of your day job I
understand but more of a personal interest.

Bruce Robinson: That's right, yes. I've been following the story since
1996 in some detail.

Terry Lane: What sparked the interest?

Bruce Robinson: I'm interested in sustainable transport, particularly
bicycle transport and the amount of oil left is directly important for
bicycle transport advocacy.

Terry Lane: I understand you've been the sole Australian delegate to
some international conferences on the future of oil.

Bruce Robinson: Yes, there's an Association for the Study of Peak Oil
and Gas (ASPO) which is a largely European organisation that had a
couple of international workshops, one in Sweden last year and one in
Paris this year at the French Institute of Petroleum. For one reason or
another I was the only person from the southern hemisphere who bothered
to go along.

Terry Lane: Is this an industry conference, or who attends?

Bruce Robinson: Oh, it's a pretty wide range of things. The first one in
Sweden which was in the University of Uppsala was largely from the
pessimist camp if you like, the scientists, geologists, largely retired
oil exploration geologists who go around in tweed coats and without a
lot of immediate vested interest they say they're retired geologists
concerned about the future of their grandchildren. The second one in
Paris had a lot more input from big companies like the Deutsche Bank and
Daimler Chrysler, French energy utilities, French oil companies but
still with a lot of gaps. The British geological survey organisation was
represented, but no one from the southern hemisphere.

Terry Lane: What is the industry saying? I've read an optimistic
prognosis from Royal Dutch Shell and I've read a very pessimistic
prognosis from BP. What does the industry in general say about the state
of supplies?

Bruce Robinson: I think the industry is caught between what they know
privately - certainly Exxon Mobil have come out, as BP have, with a more
realistic if you like, pessimistic view - but there's an awful lot of
people, there's an awful lot of misleading and deceptive information,
weapons of mass deception being used around there. Your first questions,
about how much oil is left and when will it run out, are the wrong
questions. The question is when will the world's oil production peak and
then start declining? When is the big rollover? And by asking the wrong
questions, you get into trouble and a couple of weeks ago Colin Mason
talked about the reserves to production ratio on the current estimated
reserves and the current production rate, we've got 30 or 40 years. But
that's the wrong question because it's not going to happen like that.

Terry Lane: Well what is the right question?

Bruce Robinson: The right question is when is the peak of global oil
production? When will global oil production start declining? When will
demand for oil outstrip supply? That could be happening now, it could be
in five or 10 years. But that's a big rollover. That's a change from the
current buyers market to a sellers market.

Terry Lane: Bruce I have read two answers to that question when will oil
production peak and one answer is, it already has - it peaked in the
year 2000 - and the other is it'll peak next year in 2004.

Bruce Robinson: There's a number of estimates. In fairness to the people
making the estimates it's very hard to know and the energy investment
banker Matthew Simmons has pointed out that we won't know when it peaks
until afterwards, like no-one rings a bell at the top of the market and
things like that, so we won't know until afterwards and that's got it's
own problems because we can't take action until we know more about it.
The estimates range from about now to about 2010 which is the ASPO - the
Association that Study Peak Oil and Gas - estimate and other estimates
are 2020 and they range out to the far right according to the economic
principles employed.

Terry Lane: Well Bruce in my ignorance, let me ask you another wrong
question; the optimists have it that every day we are finding new oil
reserves and this will be never-ending, we can go on using oil from now
until kingdom come. But, my wrong question, I'm sure it's wrong but it
seems to me to be so obvious is, are the reserves that we are finding
today, enough to cover tomorrow's consumption? Are we finding reserves
of quantities large enough to cover current consumption?

Bruce Robinson: The world's been using more oil than it's been finding
since about 1980. There's a lot of misleading phrases and definitions
used, it's the Enron factor, you know the companies that go broke, no
worries, they were audited by international consultants and these things
so that the Enron and the HIH factor is alive and well in the oil
industry so that there's a lot of definitions. If you're trying to make
the books look really good, you can say we're discovering a lot of oil.
If you're trying to stave off the awful truth, there's a lot of evidence
that the world is using about three or four times as much oil every day
as is being found. The rate of oil discovery reached a peak in 1960 or
thereabouts and has been declining pretty steadily ever since, so yeah,
we're on the downhill slope. But there's an awful lot of clever,
innovative bookkeeping ways of making it look better than it really is,
and that's the Enron factor and that's the sort of thing that we should
be very careful about. The optimists are very good at those sort of
weapons of mass deception, the misleading and deceptive interpretation
of the data.

Terry Lane: When the geophysicists get together, can they say with
absolute certainty that they know where every probable oil deposit is?

Bruce Robinson: Certainly there's going to be some surprises, but
perhaps 90 per cent of the world's oil is already been discovered or
thereabouts. For the last 30 years, people know an incredible lot about
where the oil is and more importantly, where it isn't. So there's an
awful lot of information there, and that's why the oil companies are
merging, they're buying each other out, they're not spending a lot of
money exploring because it's not good business sense to put money into
dry holes. There is possibly still oil to be found, but not a lot of
really important, really big ones the size of the Saudi Arabian fields
and things. Those sorts of things are probably gone with a dodo. We
won't find any more of those.

Terry Lane: When will our domestic wells run dry?

Bruce Robinson: That's not a good question either. The domestic wells
will be producing oil for a very long time. They won't be producing a
lot of oil, and that's the difference. Certainly Australia's Bass
Straits production has been declining since 1985. The Northwest Shelf
oil production has started its final decline. At the end of another
decade Australia will be having to import about 60 per cent of its oil
on its current requirements and that'll be in a very competitive market
if China and all sorts of other people importing - Indonesia is going to
have to start importing, all sorts of people like the UK. The UK is
currently exporting oil; it's going to have to start importing in about
2007 because it is over its decline curve. The oil is declining now and
that'll never be as good again as it was before so that some of the big
fields, the forties field in the north is only producing 10 per cent as
much oil as it used to in its hey day. So there are an awful lot of oil
fields going down very quickly.

Terry Lane: What about natural gas? Is that a viable alternative for transport?

Bruce Robinson: It certainly is and that's one of the things that
Australia should be doing. Your previous speaker was talking about gas
prices, but there was no indication that that's a dwindling resource and
we should husbanding it and pricing is a good signal. There's a fair
shortage of gas in the southeast of Australia. There's quite a lot in
the northwest of Australia, but it's a long way to cart it around and
certainly we should be using that because that's the transition: that
is, if we run short of oil in Australia and we can't buy it
internationally, we can use the gas directly as compressed natural gas
or we can make gas into diesel or we can make gas into hydrogen for fuel
cells in the distant future. So we certainly should be husbanding our
gas as well because gas and oil are interrelated and prices are likely
to rise at the same time.

Terry Lane: What are the implications of the long-term contract to
supply massive quantities of natural gas to China?

Bruce Robinson: If I was in power I would've been very sceptical about
any long-term contracts. It's selling the farm off. Whether it's a
long-term contract to sell the farm off or a short-term contract, I
think our grandchildren are not going to thank the decision makers who
sold off the energy sources that they are going to need in the next
generation or two. The northwest shelf gas has got a lifetime of only a
generation or something, 20 or 30 or 40 years. At the rate it's being
exported we can't use it for both electricity, selling overseas and as a
transport substitute. It can't be in three places at once. There's not
enough of it. It's a limited resource as all the others are.

Terry Lane: Well Bruce, I'm talking to you on a dodgy telephone
connection. It's always a dodgy telephone connection on Sundays. I think
something happens on Sundays from Perth. Now I mention that because the
Western Australian government I believe, is the only state government
who've done any sort of serious planning for a post-oil economy. Is that true?

Bruce Robinson: Well they're certainly leading Australia I think, and
other organisations in Western Australia like our Royal Automobile Club,
the motoring organisation. There's a state sustainability transport
plant here that the Premier's released about a month ago that mentioned
our oil vulnerability. Our Minister for Transport and Planning, Alannah
MacTiernan is I think the only transport minister in Australia who's
heard this story first hand from a real petroleum geologist Les Magoon
from the US Geological Survey, so yeah, I think Western Australia's a
long way ahead. There's a long way to go because there's an awful lot of
bureaucrats with company cars who don't want things to change. The
federal government I think, it would be best to say the federal
government's asleep at the wheel and they're not considering what's
around the bend. They're going around blind corners hoping everything's
going to be the same as it was before.

Terry Lane: Well you have to appreciate that whenever the oil runs out,
it's going to be a few years after the next election. I think that's the
problem that we face with our particular form of democracy, that it
doesn't encourage politicians to think ahead.

Bruce Robinson: Yes, it might be sooner than that. If there's a
fundamentalist revolution in Saudi Arabia we could have another oil
crisis in two or three weeks. There's not a lot of slack in the world
system so we're very vulnerable in the short term. In the medium term a
few years as OPEC gets more and more power and in the next decade or
two, for the final decline of global oil production, so I don't think
it's a good idea to put it off.

Terry Lane: So our new best friends in Iraq are not going to save us?

Bruce Robinson: Iraq's got about four years global supply, so whoever
owns Iraq will control four years of global oil supply but after, on the
fifth year, it's going to be a problem.

Terry Lane: Mmmm. Alright well I'll polish up the bike and I'll get it
out and it's obviously the vehicle of the future. You're a cyclist I believe?

Bruce Robinson: Yes, I rode into the ABC here today. It is a very
practical way of getting around and there's enormous health and
environmental cost benefits. There's an awful lot of overweight kids
being taken to school in 4WDs which are subsidised. Your previous
speaker mentioned cross-subsidies and things, businesses being
subsidised to waste petrol, the 4WDs are subsidised at $5,000 each. With
tariffs there are a whole lot of perverse policies, which are
encouraging people to use cars, like the fringe benefits tax and that's
got enormous cost to the Federal Government in the health areas,
environmental areas, congestion. There's an awful lot of very silly
things being done and people really should start considering the longer term.

Terry Lane: Bruce, thankyou very much. I'm sorry that we had to make do
with the telephone. Bruce, as you said rode into the ABC and was
supposed to be in the studio but for reasons that I don't fully
understand we couldn't put the studio to air and that's why we have the
phone. Bruce, thankyou, and ride carefully on the way home.

Bruce Robinson: Thank you very much.

Guests on this program:
Bruce Robinson, Sustainable Transport Coalition (WA)
Bruce Robinson is a scientist and cyclist who has taken a close personal
interest in the future of oil. He is the only Australian to have
attended meetings of ASPO.


Further information:
The ASPO website can be found at:
http://www.peakoil.net

The Sustainable Transport Coalition website is at:
http://www.stcwa.org.au/

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this transcript from
http://www.abc.net.au/rn/talks/natint/stories/s980345.htm