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Official US government energy statistics are full of shit

by Jerome a Paris Fri Jun 23rd, 2006 at 04:48:13 AM EST

The US government has released its official view on future energy trends, and the Oil Drum has actually gone through the numbers in detail and prepared a thorough debunking.

Bottom line; the official statistics are either lies or absurdly incompetent. Go read the whole post over at the Oil Drum (home page)), but here are a few tidbits and, of course, selected graphs.

So join me in the bright happy world of plentiful energy of the EIA:

Focusing on oil, the Oil Drum comments this graph:

They analyse where the EIA expects the oil to be coming from, and focus specifically on the output from OPEC, with the following conclusion:

 In short, those OPEC production numbers didn't come from some complicated model of OPEC reserves and decision-making. Instead, they came from a fixed percentage of the top-line production.

I think this tends to support what many of us suspected about the EIA projections: they start with what they think will be a politically acceptable demand projection, and then tweak the supply assumptions to add up to that.

Fixing the facts around the policy? Hmm, where have we seen this before?

But there's worse. The EIA has this to say about North Sea oil:

In the IEO2006 reference case, the decline in North Sea production is slowed slightly relative to past outlooks, based on the implementation of strategies for redeveloping mature fields. Production from Norway, OECD Europe's largest producer, is expected to peak at about 3.6 million barrels per day in 2006 and then decline gradually to about 2.5 million barrels per day in 2030 with the maturing of some of its larger and older fields. The United Kingdom sector is expected to produce about 2.2 million barrels per day in 2010, followed by a decline to 1.4 million barrels per day in 2030.

And the Oil Drum kindly provides the graph or recent production from that region:

Their polite comment: "what planet are they living on?" Production is already declining starkly, is set to continue on that trend, and is thus already reaching the levels expected only for 2030. So the IEA numbers bear no relation to reality whatsoever.

In the comments, jimmyboy33 adds the following info:

Current situation in UK north sea is that decline is running at 7% per year from peak ( production halves every 10 years) after new production etc brought on.

The Buzzard Field is due on in late 2006 at 200K bpd.  This will slow the decline for a couple of years(they hope).  this field was discovered 5 years ago.  No field produring over 100K bpd at present.  

Decline rate in existing fields probably 15%.

Everybody is running hard to hold the decline at 7%.

The finds being made are small.  The government and the industry talk up the future but the reality is decline.

The OD post also looks at Mexican production, oil sands production, and oil prices, with similar conclusions.

In the comments, westexas also points out that they have been full of shit about Canada as well:

In the IEO2003 they stated:

"Canada's conventional oil output is expected to increase by more than 200,000 barrels per day over the next 2 years, mainly from Newfoundland's Hibernia oil project, which could produce more than 155,000 barrels per day at its peak sometime in the next several years. Canada is projected to add an additional 500,000 barrels per day in output from a combination of frontier area offshore projects and oil from tar sands."

Assuming the total increase of 700,000 b/d for Canada was for the 2003 to 2005 period, the US DOE/EIA was only off by 710,000 b/d. In 2003, Canada's total liquid hydrocarbons (TLHs) production was 3.11 mb/d and in 2005 it was 3.10 mb/d (US DOE/EIA data/I used TLHs data because they include NGLs in their forecasts), a decline of 10,000 b/d.

And Khebab summarises how the IEA's data are not even internally consistent:

I think the EIA is definitively in love with straight lines! If you look at the third figure from the top (World production of oil by source 1990-2030):

  • The total conventionnal oil produced from 1990 to 2005 is approximatively 420 Gb. The forecast from 2006 to 2030 predicts that an additionnal 870 Gb (more than three Saudi Arabia URR!) will be produced without any visible peak.

  • The figure below about reserves is showing a world reserve around 1,300 Gb in 2006 (i.e. URR ~ 1,300 + 1,100= 2,400 Gb) which means that we will  consume 870/1,300= 67% of our reserves in the next 24 years! or (1,100 + 870) / 2,400= 82% of the URR will be consumed in 2030 without experiencing any decrease in production rate whatsoever!

  • Even worse, if we are taking out the 200 Gb dubious increase in Middle East OPEC reserves, we get  (1,100 + 870)/(2,400-200)= 90% of the URR consumed in 2030!

Now, here is the problem:

Never has been observed a production curve that is showing a production increase past the point in time where cumulative production is past 60% of the URR. The only possibility is that the world URR is in fact around 2,900 Gb and that a future 2,900-2,400= 500 Gb (+38%) jump in conventional oil reserves increase is waiting for us somewhere. Talk about an act of faith!

Faith based predictions? Again familiar...

Stuart Staniford, the author of the story, kindly provides another graph which shows how unrealistic these predictions are:

This matters because everybody uses the statistics from the Energy Information Agency (or that of its international cousin, the International Energy Agency), and their absolutely optimistic reports provide great coverage for the politicians to do nothing about our current predicament: "see, there's plenty of oil, really - the experts say so".

Again, go read the whole story, and read the Oil Drum regularly, as they look (hard) at the data and come up with a lot of excellent information and commentary.

im not sure why anyone would believe anything coming out of the US government with this administration. its highly unlikely that any anyone in this govt says is the truth the whole truth and nothing but the truth.

good article. too bad so few people care about the facts..

Life is not a dress rehearsal

by johnfire (johnfire@christopherrehm.com) on Thu Jun 22nd, 2006 at 08:47:47 PM EST
unless they are stats I like.
Seriously I always feel I'm being duped whenever anyone starts trying to justify things with statistics. All those charts and tables and numbers and mathematical analysis just seem designed to mislead. Now as for phenomenology....
by observer393 on Thu Jun 22nd, 2006 at 10:46:37 PM EST
The destruction of the Federal scientific agencies is to me the saddest part of what Bush is doing to America.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Jun 23rd, 2006 at 03:10:47 AM EST
Actually, this is not the result of the Bush administration. USGS and EIA have always been "Gosplan" like dinosaurs, denying US oil peak 40 years ago, and then again for several years after it had actually happened. They've just always been PR agencies for US oilcos. But there are still interesting research work being done in the "lower branches" of the DoE, in the real labs like Livermore. It just never makes it to the press with the seal of the white house on it, it's only in science papers and deep down the their web archives.

In the same kind of funny tone, I just dug out from my father's old papers: "Energy Future: the report from the Harvard Business School to the US government, original 1979 edition, edited by, among others, Daniel Yergin (LOL)". Back cover says their conclusion is "conserve and go solar America !". Yergin has somewhat changed his pitch since then (had to find a better paying master than academia ?? I can sympathize...). I think I'm gonna read it this summer on the beach, so the chicks around will wonder why this nerd is laughing out so loud.

by Pierre on Fri Jun 23rd, 2006 at 04:11:03 AM EST
[ Parent ]
I was quite shocked when I about a year ago first learned about the incompetence/corruption of IEA and EIA (I guess one can never become cynical enough). They can still be used as a source of historical data, but their projections are blatantly absurd.

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Fri Jun 23rd, 2006 at 09:57:18 AM EST
 " Official US government statistics are full of shit," full stop!.

 I'm not a bit surprised to hear this plaint.  I don't trust the economic data put out by the Bush administration, either!

  Bush administration commerce and labor department statistics, employment rates, inflation, GDP--all such figures should be treated as inherently suspect and guilty until proven innocent.

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Fri Jun 23rd, 2006 at 12:12:51 PM EST

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