Energy concerns - Are we hitting peak oil?

I just want to preface the next two posts by saying that most of my views are informed by a quick canvassing of the literature. What I'm saying is that my views are by no means settled. However, if I had to put something down on paper, I'd say that I certainly wouldn't count out the possibility.

This from today's WSJ:

To tap Khurais, Saudi Arabian Oil Co., known as Aramco, has embarked on the most complex earth- and water-moving project in its history. It is spending up to $15 billion on a vast network of pipes, oil-treatment facilities, deep horizontal wells and water-injection systems that it calls "one of the largest industrial projects being executed in the world today."

Moreover, with the project, Aramco is dipping into one of its last big basins of oil. After Khurais, Saudi Arabia will have only one known mega-field left to fully develop, the even more challenging Manifa field, offshore in the Persian Gulf. Much of the kingdom's reserves beyond these lie either in aging fields or smaller pockets.

"Khurais and Manifa are the last two giants in Saudi Arabia," says Sadad al-Husseini, a former Aramco vice president for oil exploration. "Sure, we will discover dozens of other smaller fields, but after these, we are chasing after smaller and smaller fish." [That doesn't sound good]


But Saudi Arabia is under pressure to ramp up its output as the world scrambles to keep pace with rising oil demand, which the International Energy Agency predicts could hit 99 million barrels a day by 2015, up from 87 million barrels a day this year [Ok, so demand is going... up]. With output declining or flat in Mexico, Venezuela, the North Sea and Russia, all eyes are on the Saudis to fill much of the gap, even as oil demand soars within Saudi Arabia itself. [And production is going... ?]

The graphic above is of Saudi's oil fields and it seems to give a pretty good indication of the relative sizes of the remaining oil fields.

Now, I haven't seen enough info out there to indicate that production has peaked, per se, but the tone of these articles definitely isn't instilling a great deal of confidence.

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