RE: Matthew Simmons on Oil

From: Glenn Morton <>
Date: Wed Aug 24 2005 - 21:19:39 EDT

At the bottom is a reply on the Sudanese situation. First Janice

janice matchett <> wrote:
### JM: "Misusing" it, because why? ---- Because you think he's not "optimistic" like me ??? :)

GRM: No, Janice, because you don't understand what he is actually saying and you don't understand what the technology he is discussing is actually doing in the business. I have used that technology, but, of course, you know more than I do about oil, never having worked in the business. Isn't it always that way? The person who has never studied an area is more knowledgeable than those who have studied it? I thought you would agree with that.

### JM: I'm from western Pennsylvania. My family were among some of the earliest settlers in America. They have been in all aspects of the oil and gas well drilling business almost from the word go (Drake, and all that) all the way from PA. to TX. to OK, to everywhere inbetween. We still have wells pumping daily on family property there - the oil is still being marketed. I've been present when plenty of wells came in and also when we had to call in Red Adair to cap them. Point being:

[1] I do understand the role of pressure in an oil field.

GRM: You certaintly don't demonstrate such knowledge, and watching a guy put out a fire is not the same as understanding the function. And just because your relatives knew something about oil, doesn't mean that you know didly. Knowledge isn't genetic you know.
[2] I am a "can-do" optimist. I will quote those I consider to be realistic optimists in the energy field to counter the "can't do" pessimists who are a dime a dozen. Roger N. Anderson is a realistic optimist in my estimation - that's why I posted his article.

GRM: Sigh, There is a study that showed that those who are incompetent are incompetent to know that they are incompetent.


 Take note: "....Though they receive little attention in institutional publications, there are major controver-sies over the estimates of the ultimate reserves of recoverable oil.

GRM: Sorry, Janice, those controversies are covered in all the institutional publications. Why do you think I was reviewing Michael Lynch's paper before it was PUBLISHED in (darn I don't think you actually understand that publication of an article means it was discussed in an institutional publication like..) the Oil and Gas Journal. Lynch's views have made those pages and he is invited to many of the seminars. Your lack of having attended these conferences and the lack of having actually read the journals is why you don't know that what you are mindlessly parrotting is false.

• The greatest optimists 1* base themselves on the fact that the total of proven reserves has grown continually over the last 50 years. That growth has been fuelled both by technological progress which has improved the rate of recovery of oil from wells (30% on average in the 1960s, 40-50% today) and by the recent addition of deepwater fields (> 1,000 m), which were seen as impossible to exploit 15 years ago. They estimate, therefore, that in the future three factors will make it possible to increase oil reserves:
&shy; the continuing improvement of recovery rates;
&shy; the discovery of oil in as yet unexplored zones (polar regions and deep water);
&shy; the exploitation of oil of a non-conventional nature, such as the extra-heavy oils of the
Orinoco or the tarsands in Canada.
Projecting forward the past trend for proven oil reserves to increase, they estimate that the world does not need to fear a shortage for 40, if not indeed 80, years.

*1. This group includes the US Geological Survey (USGS); Roger N. Anderson, Adjunct Professor at the University
of Columbia, a specialist in marine geology and geophysics; Michael C. Lynch, Chief Energy Economist at DRI-
WEFA and an economist at the Center for International Studies, Massachusetts Institute of Technology (MIT); and
Morry A. Adelman, economist at MIT.

GRM: YOu actually haven't address the issue that reserves don't matter. You have ignored what I and others have said to you. This is the mark of an incompetent person.


• For the pessimists, 2* oil is a finite resource and its main areas of exploitation were discovered long ago. Only small quantities of oil remain to be found. In fact, the last discovery of a field containing more than two years’ worth of global consumption (50 gigabarrels) goes back 30 years. That was in the North Sea. Since the early 1980s, consumption exceeds discoveries. In the 1990s, discoveries were running at less than half the level of global consumption. They assert that the recovery rates of oil wells depend more on the form and geology of the deposits than on technology (the rate can vary between 3% and 80% depending on the nature of the well). Recent technological progress has, in particular, enabled better-targeted explo- ration of the areas likely to yield hydrocarbons, and less costly exploitation. That progress will not, however, compensate by better recovery rates for less productive finds, except in the case of oils of a non-conventional
type (i.e. heavy oils, tarsands).

GRM: Are you putting your money where your big mouth is? are you invested according to what you say? I bet you aren't.

* 2. Including Walter Youngquist, retired Professor of Geology at the University of Oregon, former geologist at Exxon
and author of Geodestinies: The Inevitable Control of Earth Resources over Nations and Individuals (Portland:
National Book Company, 1997); L. F. Ivanhoe, former Senior Adviser of Worldwide Evaluations of Petroleum
Basins to Occidental Petroleum and subsequently founder of the King Hubbert Centre at the Colorado School of
Mines; Kenneth S. Deffeyes, head of the Shell Oil laboratory at Houston, before becoming Professor of Geology
at the University of Princeton; Colin Campbell consultant, geologist with Texaco and Amoco, and executive vice-
president of Fina-Norway; Jean Laherrère, consultant, geologist and geophysicist, head of exploration techniques
at Total for almost 30 years. ~ [snip]

Another item:

Roger N. Anderson, Lamont-Doherty Earth Observatory of Columbia University

GRM: This article was written in 1993 and does not say we have an endless supply of oil. Sorry, you are wrong.

The naysayers:
Re: Eugene Island, Gulf of Mexico, US Territorial Waters

Eugene Island is one of the darlings of abiotic theorists. Cornucopians point to Eugene Island as proof that oil reserves are mysteriously refilling. There have been many bold and unreliable claims about the amount of oil held in these reserves, and the rate of recharge. These claims fall flat upon examination. Here we will stick to reserve data as reported by the Oil & Gas Journal (OGJ) and the Minerals Management Service (MMS), two reliable sources of information.

In 1978, the OGJ reported estimated reserves of 325 million barrels (Mb). The figure was increased to 388 Mb by 1998, due to the standard US practice of initially only reporting proven reserves and neglecting the probable reserves. This practice evolved due to Security and Exchange Commission rules on the reporting of oil reserves, but is a boon to US company profiles because it allows them to regularly add to their reserve numbers over time, making it appear that they are discovering more oil. Jean Laherrere has said that the noted explorer Klemme estimated 500 Mb in 1977.16 The MMS estimated reserves at 464 Mb in 1986, and at 416 Mb in 1998, which would mean that reserves declined. Production peaked in 1996 at around 30,000 barrels/day (b/d)-28,000 b/d reported in OGJ, and 33,000 b/d reported by MMS.

Jean Laherrere created the following graph. It shows monthly production in relation to total production, and demonstrates quite clearly that Eugene Island is in decline. It also shows two distinct periods of recharge, both of them minor in relation to the overall graph. [click link to see it]

That some recharge of the reservoir is occurring is not to be denied. 4D seismic studies suggest migration along Red Fault (one of the best studied faults in the world).17 But refilling is considered to be minor, reflected in a strong decline, then a slight rebound due to refilling followed by a new decline.

In the early 1990's an ambitious investigation of Eugene Island was undertaken through the joint auspices of the Global Basins Research Network, the Department of Energy and the oil industry.18 The purpose of the project was to develop new technologies to extract hydrocarbons from the streams which feed reservoirs instead of merely draining the reservoirs themselves, or to enhance the streams so that they will better feed the reservoirs. The study focused on Eugene Island and on the Gulf of Mexico in general because newly migrating hydrocarbons were well documented in this region, and migration approached rates of extraction. The project first had to determine the pathway of the migrating hydrocarbons and their origin.

The study determined that hydrocarbons were indeed migrating along the Red Fault. They concluded that as oils at depth are over-cooked and cracked into gas, this results in an increase of pressure. This is due to the expanding volume of gas produced from the more compacted volume of oil. When the pressure grows to hydraulic fracturing stress, the faults open and release a stream of oil and gas upward toward the surface. The migration pathways seem to branch from what appear to be three primary source areas at depth.19

The migrating hydrocarbons contain biomarkers, heavy metals, and sulfur isotopes which indicate a carbonate marine source of Cretaceous age. The three sourcing depobasins are believed to be turbidite sands: organic detritus rich sands stirred up and deposited by deep sea turbidity currents. These turbidites were capped by a salt sheet and then buried beneath 3 million years of deltaic sands, resulting in the geopressures and temperatures necessary to transform the organic detritus into oil and gas.20

Anderson, et al., [see article below] concludes that a conservative estimate might place undiscovered hydrocarbons in the Northern Gulf at 20 billion barrels. The report suggests that a concerted effort to explore the entire U.S. Gulf of Mexico for similarly situated reserves might result in the discovery of greater than 50 billion barrels of unrecovered hydrocarbons.

There is no doubt that the hydrocarbons of Eugene Island are of organic origin. The recharging of Eugene Island reserves is simply the result of complicated geological structure. ..... Excerpted from:

No Free Lunch, Part 2: If abiotic oil exists, where is it? by Dale Allen Pfeiffer
© Copyright 2005, From The Wilderness Publications, All Rights Reserved. May be


GRM: Janice, oil gets into oil traps by migrating along the faults. It isn't a sign of an endless supply. But keep dreaming in your imaginary world. I have better things to do than to try to convice fools.

Now for the Sudanese situation. Here are my comments.

The web site cited today about oil causing the Sudanese war said:

“Invisible because it is happening in Africa. Invisible >because our mainstream media are subsidized by the >petroleum industry. Think of all the car ads you see on >television, in newspapers and magazines. Think of the >narcissism implicit in our automobile culture, our >suburban sprawl, our obsessive focus on the rich and >famous, the giddy assumption that all this can continue >indefinitely when we know it can't -- and you see why >Darfur slips into darkness.” “Darfur as a Resource War”

By David Morse,


First off, I never trust Illuminati-like conspiracy theorists. They are always wrong. The oil industry IS NOT the car industry. It is not a group of people who sit in dark and sinister offices manipulating the flow of history. I am in the oil industry and I wish we could find another energy source so this concept that the oil industry is stopping us from knowing this or that is paranoiac-like blather.


Secondly, the entire idea that oil is driving the war is also blatantly false, as a brief google shows. The civil war started in 1983.


“Sudan's civil war, primarily a struggle between the Muslim North and the Christian and animist South led by the Sudan People's Liberation Front (SPLA), has raged since 1983 and killed an estimated two million people.”


The very first oil production in the Sudan was in 1993, long AFTER the war began.It is so easy to check that out yet the author didn’t find out that the war started 10 years before the oil. (I would strongly suggest an internet search on a few items before passing on such stuff.)


I just love this:


“Oil companies and exploration companies like Halliburton wield political and sometimes military power. In Sudan, roads and bridges built by oil firms have been used to attack otherwise remote villages. Canada's largest oil company, Talisman, is now in court for allegedly aiding Sudan government forces in blowing up a church and killing church leaders, in order to clear the land for pipelines and drilling. Under public pressure in Canada, Talisman has sold its holdings in Sudan. Lundin Oil AB, a Swedish company, withdrew under similar pressure from human rights groups.”


Halliburton is NOT an exploration company it is a service company. Dumb Dumb and dumber.


The only time I have ever heard of oil companies having arms is when they are trying to operate in an area with guerrillas. Then they hire guards. It is purely defensive. And if the oil companies were so powerful, why did Talisman and Lundin withdraw? It was because they saw that they couldn’t make money and that it would be a PR nightmare down there in Sudan.


Finally, if the author had cared to think critically, he could have learned that the entire Sudanese reserves are 563 million barrels, not even a 2 week world supply!

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Received on Wed Aug 24 21:21:57 2005

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