Geoff of Perth

this is actualy a reasonable point; "For example, Canada produces about 1.7m bpd from oil sands, but it has taken the Canadians 40 years to achieve this output level."

But you over look the point that the reason for the delay was the price of oil and technology. The Canadians discovered a way to get at a large portion of the sands for a tolerable cost, what, about a decade ago? But that cost was still too high before recent developments in the oil price - hence the delay. It still takes longer to expand output from sale oil site than it does for conventional oil deposits, as I understand it, just not nearly as long as you suggest..

Curmudgeon, I have no problem with your assumption.

The economic reality, from a rational point of view, acknowledges the Canadian example is too long in terms of that which is currently occurring in the energy sector today.

Supply and Demand are two different beasts.

Unconventional energy sources need the price mechanism to remain high, particularly over the longer-term.

Unfortunately we have a fractional reserve banking economic system, i.e. money (credit/debt) created into the system at interest, and this requires continued economic expansion (growth) to sustain itself.

Again, unfortunately this becomes problematic in energy terms. Once a certain percentage of GDP is funnelled into paying for energy (say oil at about 4-5% of GDP) economic contraction occurs.

This is what has been happening in the U.S., Europe and further afield globally since about 2004/05.

No serious 'Peak Oiler' has ever stated we are running out of oil, what they point to is the 'disjunct between conventional "cheap" energy and "expensive" unconventional energy resources’; this is where the classic problem lies.

Economics cannot overcome this problem and our future prosperity is at stake. This is not a shell argument; it is a serious issue that needs serious discussion and action across all levels.

Given the possible economic contractions facing the EU, U.S., possibly China, Japan and other emerging economies in the near to mid term, I see a big problem putting great faith in the merits of relying on 'unconventional' energy resources.

I am sure history will show who has been correct in the years to come!

We already hit peak oil in 2007.

Not peak oil *production*, but peak oil *demand*. Yes, oil demand is increasing in China and India, but not at the rate that was once predicted. New technologies are making pretty much everything more fuel efficient and new energy sources are increasingly being employed instead of oil.

I have faith that humanity will beat this challenge, as we have previous challenges. As oil becomes more expensive, it becomes less desirable and other options start looking more appealing.

Hi Geoff Of Perth,

Some oil Industry terminology is used to describe the two basic types of oil reserves referred to as “Conventional oil” and “Non-conventional oil”.

“Conventional oil “ is typically high quality, free flowing light oil that is under pressure and in most cases pumps itself out of the ground until about half of the oil had been extracted from an oil reservoir. The “peaking of world conventional oil production” is the sum total of all reservoir
production when it reaches a peak and is referred to as “oil peaking” or “peak oil” . Most, of the reserves of conventional oil requires less energy to extract, cost less to refine into fuel and petrochemicals than non-conventional oil. When consumed as fuel produced less greenhouse than diesel or bunker fuel

“Non-conventional” oil reserves are mostly, heavy and tar like requiring a lot more investment and energy to extract from sands or rocks on the surface or under ground and then refine into usable oil products. It includes some high quality, free flowing light oil that is recovered in oil fields in one km or more, deep oceans or from Polar Regions.

Non-conventional oil can also be made from coal or gas which will greatly increase CO2 emissions which needs to be buried underground in a safe way by “geo-sequestration” .Government intervention is necessary to prudently risk manage the unsustainable growth of oil dependence to mitigate the potentially disastrous consequences of conventional world oil production peaking. Oil peaking presents Australia and the world with risks that has to be considered with global warming and food production.Even though global warming rate is still uncertain .

Far more serious risks of air and soil pollution will come with the exploitation of non conventional oil and gas by the under ground fracking of coal and shale.

They seem to keep finding more and more oil.What the cartels are doin, is capping new finds to keep the price high.

I would take with a grain of salt any info from eco-AGW enthusiasts who rely on the lie for their existance at tax payers expense.

Herbert Stencil, I disagree that the problem is primarily an economic one. It is true that economics does play a role in whether or not oil sources a viable and as the price of oil rises then more expensive options become increasingly affordable.

However resource limits are real and at a certain point the energy invested into extracting a resource becomes equal to the energy gained from that resource. This is the case with corn-based ethanol which has an energy returned on energy invested (EROEI) of 1.3:1. It is very close to a zero sum game.

Historically oil has had a net energy return of 100:1. This means it took one barrel of oil to extract 100 barrels of oil. By the 1970s this had decreased to 30:1. Currently we are sitting at about 18:1. For unconventional oil sources the net energy return is much lower. Oil sands are currently estimated between 7.2 and 1.5:1.

The bare minimum net energy return for industrial civilisation to continue to function has beenput at 3:1 http://energybulletin.net/node/52341. It would allow only for energy to run transportation or related systems, but would leave little discretionary surplus for all the things we value about civilization: art, medicine, education and so on; i.e. things that use energy but do not contribute directly to getting more energy or other resources. Although other research I have seen has been put at 10:1 for modern conveniences to continue.

No matter how much money you throw at these unconventional sources you can't break the laws of thermodynamics.