Saudi Arabia global oil exports to wane post-2010

[Subdivisions]

Since we're already talking about oil production:

Saudi Arabia’s long-standing status as a swing producer of crude oil could be drawing to a close according to the head of national oil company Saudi Aramco.

Global oil exports from Saudi Arabia, the world's largest oil producer alongside Russia, will start to wane in the coming years as domestic demand surges and spare capacity drops, warned Khalid al-Falih, chief executive officer of Saudi Aramco in a speech published on the company's website.

...snip...

VTB Capital says that, although Saudi Arabia knows it is running out of oil, Saudi Aramco is already part of one of the most "remarkable" developments of 2009, after admitting it has started exploration in the Red Sea and not the Persian Gulf.

"Saudi Arabia is running out of oil and Ghawar field will exhaust itself in the end," says Kryuchenkov. "It has been producing oil since 1948, which is unprecedented for any field and still accounts for around 55–60% of exports. The decline will accelerate from here and I think these are more immediate concerns than its consumption growing. As a rule of thumb in the oil industry, Saudi Arabia is seen as the following: a 5% decline in production and a 2% rise in consumption is approximately 15% decline in net oil exports. However, this is not the case just yet."

...snip...

http://www.risk.net/energy-risk/news/1602907/saudi-arabia-global-oil-exports-wane-post-2010

Peak oil is the point at which a well reaches maximum production and then begins an irreversable delcine. It has happened in every depleted oil well in history. When extrapolated to GLOBAL oil production, peak production for conventional crude oil occured in 2005 and has been declining by 2.1% year-over-year (YOY) for the past five years. It is accepted premise in the oil-watching community that once Saudia Arabia's production begins to decline, the peak of global oil production will have been reached and cumulative world oil production will decline. The decline in world oil production is expected to accelerate to as much as 8% YOY by 2012-2014. A consensus is forming that net oil availablility will reach zero sometime around 2037.

Though there will still be lots of oil left in 2037, it won't be available for a trip across the state to grandma's house for Christmas, or for a quick trip down to the corner convenience store for a Coke and a bag of Dorito's, if those things even still exist by then.

[Smashcut]

1. Export land model.

http://en.wikipedia.org/wiki/Export_Land_Model

I think we're now driving off the precipice and down the slope to a very uncertain energy future.

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4. You got it! Whew! It's so good to see someone who GETS it!

ELM is why all the talk about getting off foreign oil. It's because WE MUST get off foreign oil. Instead we get stone-cold silence from our elected leaders about this most-dangerous of issues - more dangerous than climate change. And the irony is that dealing with the oil depletion problem would actually help mitigate climate change. What we'll get instead is politicians and corporations getting rich off the ride down into the Olduvai Gorge.

[Smashcut]

6. Well thank you, and likewise!

Glad you posted this. Frankly I think our "leaders" wouldn't have the slightest clue how to deal with such a massive collective action problem, even if they themselves could comprehend that the economic conditions they assume are permanent are actually anything but. Which is why sadly I have little faith that we'll come through this with a soft landing.

[BootinUp]

2. I am still waiting for any peak oil prediction to come true

throw enough money into development and peak oil will not happen in my lifetime (estimated date 2030-2040)

[neverforget]

3. And the price of that oil is going to be very high because of the difficulty drilling

it.

[dixiegrrrrl]

9. Looking at our beaches down here, today,

I can think of another high cost issue.

[neverforget]

10. Absolutely.

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5. That is a common meme, false as it still is...

"Peak oil" has already occured THOUSANDS OF TIMES! Every single depleted oil well in the history of the world has experienced peak oil

Once world oil production has peaked, NO AMOUNT OF MONEY CAN REVERSE IT! Anyone who knows the first thing about this very real issue knows this.

Read this very carefully: WORLD OIL PRODUCTION HAS ALREADY PEAKED. PEAK OIL HAS ALREADY HAPPENED.

[Smashcut]

7. You're watching it happen.

Did you read the article?

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8. '...throw enough money into development...' Here's a log for that fire...

Costs to build in the oil sands have grown so high that one of the world’s largest energy companies plans to wait at least five years – perhaps much longer – to expand its presence there.

The oil sands have become one of the most costly places on earth to pursue oil projects, said Marvin Odum, the Americas head for Shell (RDS.A-N62.751.061.72%).

As a result, the company will delay any decisions on expanding its Athabasca Oil Sands Project (AOSP) until at least the second half of this decade, and will focus instead on wringing more production out of its existing facilities.

...snip...

http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/shell-puts-oil-sands-expansion-plans-on-hold/article1550160/

EROEI. Look it up.

Edited to add another:

Pemex May Need to Invest More Than $25 Billion Yearly (Update2)

...snip...

Chief Executive Officer Juan Jose Suarez Coppel is seeking Pemex’s first production gains in six years as he arrests slumping output at the Cantarell field and spends about $19 billion on projects such as the onshore Chicontepec field. The company’s board expects to complete a review within two months of the “appropriate” level of spending, Kessel said.

“It’s in our best interest to increase investment,” she said. “As long as we have the right project, Pemex will be getting the money that is necessary for investment. We have to maximize the value of Pemex.”

Mexico’s finance ministry last year cut its output forecast for Pemex to 2.5 million barrels a day in 2010. Agustin Carstens, the finance minister then, said output would fall through 2012. Pemex had about $49 billion of debt last year.

Fiscal Load

Pemex “cannot afford an investment increase with the current level of oil prices and the current fiscal load,” Enrique Gomez, a Standard & Poor’s analyst in Mexico City, said yesterday in a telephone interview. “For us it would be an area of concern if the government doesn’t cut Pemex’s taxes.”

Oil provides about 30 percent of the Mexican government’s revenue.

...snip...

http://www.businessweek.com/news/2010-04-30/pemex-may-need-to-invest-more-than-25-billion-yearly-update2-.html

You can't claim that they can spend their way out of peak oil when it is the peaking of their oil production that is the root of the problem.

[MajorChode]

11. In 1956, Hubbert predicted US oil production would peak between 1965-1970

It peaked in the early 70's.

So your wait is about 40 years overdue.

[Subdivisions]

12. Discoveries peaked ~1965 at 56 Billion barrels and has been declining since...

so that in 2008, only 10 billion new barrels of oil was discovered. But we (globally) used 31 billion barrels that year.

Hubbert also predicted the world peak for 2000-2001 timeframe. He missed it by only 4 years. Without the Arab oil embargo of the early 70s and the subsequent campaign of conservation that lasted several years, his prediction would have been spot on.

[MajorChode]

13. That's what makes it so funny that people actually think we can just keep discovering new oil

And drill our way out of the current oil crisis. The fallacious argument you hear quite often is that there is enough oil in the ground to last us a brazilian years. Even if that were true, very little of that oil can be extracted efficiently, which means it either takes more energy to extract the oil than you get out, or it's prohibitively expensive in terms of money and/or environmental costs. Any given oil field has a max amount you can extract at any one time without destroying the oil field. So it's not like a tank that you can just pump more out when you need it. It's also highly unlikely that any "easy" oil of any significant amount will ever be found again.