Thermodynamic model of oil depletion sparks controversy

youtube-Logo-2gc2reddit-logoOff the keyboard of François-Xavier Chevallerau

Follow us on Twitter @doomstead666
Friend us on Facebook

Published on Cassandra's Legacy on March 6, 2017

cassandra_retouched

Discuss this article at the Environment Table inside the Diner

This is a post by François-Xavier Chevallerau, a Brussels-based public policy professional who is in the process of setting up a new international think tank to support the emergence and promotion of biophysical economics in the public debate and the policy conversation. Here, he comments on the "Hill's Report" that was also discussed in a previous post on "Cassandra's Legacy." 

 

 

 

 

Guest post by François-Xavier Chevallerau

A report on the world’s oil depletion problem published several years ago by an obscure association of anonymous consulting engineers and professional project managers is suddenly coming under fierce criticism. 
 
In December 2013, an ‘association of consulting engineers and professional project managers’ calling themselves ‘The Hill’s Group‘ published a report titled ‘Depletion: A determination for the world’s petroleum reserve’. Depletion, as is well known, is the inevitable consequence of non-renewable resource extraction, and determining how this depletion will affect petroleum production has been a key focus of energy analysts and researchers for a long time.

Arriving at an estimate for the remaining extractable petroleum reserve is usually attempted by adding together the quantity of petroleum believed to be present in each field, a method which is error-prone and imprecise. The Hill’s Group’s study proposed an alternative model of oil extraction and depletion, rooted in thermodynamics – i.e. the branch of physical science that deals with the relations between all forms of energy. This model, called ‘ETP’ (Total Production Energy), is allegedly derived from the fundamental physical properties of petroleum, the first and second laws of thermodynamics, and the production history of petroleum.

The methodology used by The Hill’s Group is based on ‘exergy analysis’. Exergy in thermodynamics means ‘the maximum amount of work that can be extracted from a system’. The system being considered, in this case, is a unit of petroleum. The Hill’s Group’s study calculates the maximum amount of work that can be extracted from a unit of petroleum, using the physical properties of the crude oil in question, equations derived from studies of the First and Second Laws of thermodynamics, and the cumulative production history of petroleum. It then uses these these values to construct a mathematical model that it claims can predict the status of the world’s petroleum reserve with a much smaller margin of error than can be provided by the quantity measurement approach.

Optimistic estimates place the world’s total petroleum reserve at 4,300 billion barrels. Of that quantity the model proposed by The Hill’s Group predicts that it will only be possible to extract 1,760.5 billion barrels, or 40.9% of the total reserve. Its model suggests that petroleum’s ability to supply the energy needed to sustain its own production process is declining, that petroleum depletion is further advanced than generally assumed and that oil production will decline or even collapse much faster than commonly anticipated.

From its ETP model the Hill’s Group also derives a petroleum cost curve, which it says maps the price of petroleum since 1960 with a correlation coefficient of 0.965, making it the most accurate oil pricing model ever developed. It also says that the price of oil depends, in addition to production costs, on the amount that the end consumer can afford to pay for it, and derives from its ETP model a Maximum Consumer Price curve, representing the maximum price that the end consumer can pay over time for petroleum. It is based on the observation that the price of a unit of petroleum can not exceed the value of the economic activity that the energy it supplies to the end consumer can generate. According to the Hill’s Group, its model shows that 2012 was the energy half way point for petroleum production, i.e. it was the year when one half of the energy content of the petroleum extracted was required to produce the petroleum and its products. From then on, it says, the price of oil can only be pulled down along the descending Maximum Consumer Price curve, which it says is curtailed at $11.76/ barrel in 2020. At this point petroleum will no longer be acting as a significant energy source for the economy, and its only function will be as an energy carrier for other sources. In other words, the oil industry as we know it will disintegrate, with a myriad of negative consequences for the world economy.

The Hill’s Group’s original report was published over three years ago, and a second version was published in March 2015. It gained significant popularity and was favorably commented on many blogs and websites. All this however seems to have change, and the Hill’s Group’s ETP model is now coming under fierce criticism from various sources:

‘SK’, a professor emeritus in the department of Mechanical and Aeronautical Engineering at a Major U.S. University, delivered a strong critique of the ETP oil extraction model at peakoilbarrel.com. The fact that The Hill’s Group said that a threshold for oil markets was passed in 2012 and that oil prices would tend to go down shortly after seems to give the report a superficial credibility. But according to SK the thermodynamic analysis is incorrect and therefore any calculations and graphs based on this analysis must also be unreliable.

Spanish physicist Antonio Turiel published on his website an analysis of the theoretical basis of the ETP model (in Spanish). Applying the principles of thermodynamics to evaluate the limits of the oil’s capacity to deliver net energy to society makes sense, he says, provided it is done in a proper way. The ETP model, however, is according to him based on an incorrect use of thermodynamic theory, erroneous deductions, definitions that do not make sense from a physics point of view, deficient data processing, and ignorance of the interactions between oil production and the economy as well as other energy sources. Given these important shortcomings, he says, the ETP model cannot be used for a serious discussion of oil depletion, at least not until it is fundamentally revised and rebuilt.

Another Spanish physicist, Carlos de Castro from the University of Valladolid, also published a scathing critique of the Hill’s Group’s report (in Spanish). The physical, technological and economic foundations of the report are erroneous, he says. The Hill’s Group in fact focuses on the loss of thermal energy involved in the oil extraction process (oil moving from a high temperature reservoir to ambient temperature outside), which he says has nothing to do with the energy cost of the oil procurement process for human societies. What matters to society, he says, is not oil’s thermal energy but its chemical energy – even if this chemical energy may then be used to generate heat. The ETP model, he concludes, is not an adequate model to assess the net energy derived form petroleum extraction and its evolution.

Prof. Ugo Bardi from the University of Florence is also taking aim with the Hill’s Group’s work in a recent blog post. The Hill’s Group’s report, he says, is badly flawed. While it is true that the oil industry is in trouble, the calculations by the Hill’s group are, at best, irrelevant and probably simply plain wrong. The problem of diminishing energy returns of oil production is real, Bardi says, but the way to study it is based on the ‘life cycle analysis’ (LCA) of the process. This method takes into account entropy indirectly, in terms of heat losses, without attempting the impossible task of calculating it from textbook thermodynamic principles. By means of this method, we can understand that oil production still provides a reasonable energy return on investment (EROI). It is anyway erroneous, says Bardi, to draw conclusions regarding the economy from net energy analysis. The economy is a complex adaptative system that evolves in ways that cannot be understood in terms of mere energy return considerations.

This controversy surrounding the Hill’s Group’s report reveals some inconvenient truths that the ‘peak oil’ community now has to face. The Group’s work was widely embraced and disseminated in this community, with no or limited critical scrutiny. It indeed has an aura of scientific accuracy that comes from its use of basic thermodynamic principles and of the concept of entropy, correctly understood as the force behind the depletion problem. But behind the thermodynamic terminology, it proposes a series of assumptions, not always explicit, and of complex mathematical calculations that nobody until recently had apparently taken the time to review. As pointed out by Antonio Turiel, the Hill’s Group’s work would probably not have passed a proper peer review process in its current form.

Yet the report was widely accepted and commented in the ‘peak oil’ community. According to Ugo Bardi, this episode shows that “a report that claims to be based on thermodynamics and uses resounding words such as ‘entropy’ plays into the human tendency of believing what one wants to believe“. As many in the ‘peak oil’ community want to believe in imminent collapse and disaster, works like the Hill’s Group’s report that are perceived as providing a serious scientific basis to catastrophism are widely embraced. If the scientific basis is revealed to be not as sound as initially thought, as seems to be the case for the Hill’s Group’s work, then its embrace and dissemination can only be detrimental to the peak oil community and undermine its credibility.

Energy researchers and analysts should probably be particularly cautious and vigilant when using the concept of ‘entropy’. As pointed out by Ugo Bardi, “entropy is an important concept, but it must be correctly understood to be useful. It is no good to use it as an excuse to pander unbridled catastrophism.” The problem being, of course, that entropy cannot be correctly understood so easily. As famous scientist John von Neumann (1903-1957) once advised a colleague: “You should call it entropy (…) nobody knows what entropy really is, so in a debate you will always have the advantage.

 

 

3 Responses to Thermodynamic model of oil depletion sparks controversy

  • Ken Barrows says:

    In the long run, what counts is whether it takes more joules to extract each barrel of oil than previously.  To this point, I haven't seen any evidence that suggests it is taking fewer joules to extract (refine/distribute) each barrel of oil.

  • Joe Bloggs says:

    we will still be in deep doodoo but the voodoo they used to time that doodoo was the wrong voodoo

  • Anti Troll says:

    It was hoodoo voodoo they used to calculate the doodoo

Leave a Reply

Your email address will not be published. Required fields are marked *

Support the Diner
Search the Diner
Surveys & Podcasts

NEW SURVEY

Renewable Energy

VISIT AND FOLLOW US ON DINER SOUNDCLOUD

" As a daily reader of all of the doomsday blogs, e.g. the Diner, Nature Bats Last, Zerohedge, Scribbler, etc… I must say that I most look forward to your “off the microphone” rants. Your analysis, insights, and conclusions are always logical, well supported, and clearly articulated – a trifecta not frequently achieved."- Joe D
Archives
Global Diners

View Full Diner Stats

Global Population Stats

Enter a Country Name for full Population & Demographic Statistics

Lake Mead Watch

http://si.wsj.net/public/resources/images/NA-BX686_LakeMe_G_20130816175615.jpg

loading

Inside the Diner

For me, this all is just the reality of facing the fact all things die.Once I die, in this reality I will have no cognition of other things which die after me.  I am not disturbed by the idea of "extinction".  Extinction is a guarantee, it is only a t...

Climate chaos, mass extinction, the collapse of civilization: A guide to facing the ecocide.(Long essay by the editor of High Country News)http://www....

Quote from: Surly1 on Today at 02:48:30 AMQuote from: knarf on Today at 02:20:50 AM[img width=900 height=400]https://openmind693.files.wordpress.com/2017/07/dine-monstery.jpg?w=1200&h=800&...

Quote from: Uncle Bob on Today at 04:20:58 AMQuote from: RE on Today at 12:02:10 AMQuote from: Uncle Bob on July 26, 2017, 10:42:01 PMI did not submit an answe...

OMFG.THESE MAGNETS ARE BEYOND BELIEF!  I can break two of them off the stack by hand because I have enough leverage.  I get it to 90 degrees then twist and pull at the edge.  It is still hard to do though.Down to 2 magnets, it's IMPOSSIB...

Recent Facebook Posts

Common Dreams

Happening Now: Sanders Talks Single-Payer on Senate Floor – Common Dreams staff As Republicans move ahead with … https://t.co/UrKT7Ik0Ru

1 hour ago

GOP Single-Payer Ploy Shows Just How 'Very Sick' US Healthcare Debate Remains

GOP Single-Payer Ploy Shows Just How ‘Very Sick’ US Healthcare Debate Remains https://t.co/48SFBDWCFB

1 hour ago

First editing of human embryos carried out in United States

Technology that allows alteration of genes in a human embryo has been used for the first time in the United States, according to Oregon Health..

1 hour ago

So what if we’re doomed?

Climate chaos, mass extinction, the collapse of civilization: A guide to facing the ecocide.

2 hours ago

Netanyahu Wants To Expel Al Jazeera From Israel Over Unfavorable Coverage

From MintPress:

2 hours ago

Diner Twitter feed

Knarf’s Knewz

For me, this all is just the reality of facing the [...]

Climate chaos, mass extinction, the collapse of ci [...]

Quote from: Surly1 on Today at 02:48:30 AMQuote fr [...]

It is in the right sidebar and heads up the Newz C [...]

Quote from: knarf on Today at 02:20:50 AMNice! Tel [...]

Diner Newz Feeds
  • Surly
  • Agelbert
  • Knarf
  • Golden Oxen
  • Frostbite Falls

Quote from: Eddie on July 25, 2017, 04:44:13 PMQuo [...]

Doomstead Diner Daily 7/26[html] [...]

Quote from: Eddie on July 25, 2017, 04:44:13 PMQuo [...]

Quote from: Surly1 on July 25, 2017, 03:50:04 PMQu [...]

Quote from: Surly1 on July 25, 2017, 03:50:04 PMTh [...]

For me, this all is just the reality of facing the [...]

Climate chaos, mass extinction, the collapse of ci [...]

Quote from: Surly1 on Today at 02:48:30 AMQuote fr [...]

It is in the right sidebar and heads up the Newz C [...]

Quote from: knarf on Today at 02:20:50 AMNice! Tel [...]

Quote from: K-Dog on July 20, 2017, 01:36:05 PMOil [...]

Oil for gold. Black Russian gold, no Texas tea.Whi [...]

As I remember the deal was struck & signed on [...]

Martin Landau was probably most famous for his rol [...]

If the Nukes don't get ya, the STDs will.  Th [...]

I'm jealous. I wanna go to collij. [...]

I have been doing research for my next adventure w [...]

https://www.washingtonpost.com/national/governor-d [...]

Alternate Perspectives
  • Two Ice Floes
  • Jumping Jack Flash
  • From Filmers to Farmers

Have You a Positive Personal Practice? (Part Two) By Cognitive Dissonance   My apologies for how tar [...]

Have You a Positive Personal Practice? By Cognitive Dissonance   Those who dive deeply into unmaskin [...]

Dark Homes By Cognitive Dissonance   While we closed on the purchase of our mountain cabin in March [...]

The Greater Depression By Cognitive Dissonance   Once or twice a month Mrs. Cog and I pack up the ca [...]

SkyNet is Sentient and Will Destroy Your Investments and Pension By Cognitive Dissonance     Do you [...]

Event Update For 2017-07-24http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-07-23http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-07-22http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-07-21http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-07-20http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

With a bit of ice on the floor depositers could almost ride the seeds right on in (photo by Global C [...]

Well, at least it was made sure that the Svalbard Global Seed Vault looks real pretty (photo courtes [...]

Now it's data that makes the world go round? It's comfortably accepted by many that what w [...]

I left off last week's post – "Money Doesn't Grow on Trees, Industrial-Scale Renewabl [...]

When you wish upon a star the Blue Fairy sends Tinker Bell, who plants a magic seed, which grows int [...]

Daily Doom Photo

man-watching-tv

Sustainability
  • Peak Surfer
  • SUN
  • Transition Voice

Can Foodies Save the Planet?"Facing all of these grave threats, humans collectively have chosen to go insane."Having a [...]

Snowflake Summer"Why has academia descended into neo-fascist regimentation?"We didn’t give serious thought [...]

Maya Theater States"What generally occurs when a civilization over-extends is not a complete disappearance but a r [...]

The Ragweed Tribe"We bonded much more deeply than crash-pad stoners or cubicle rats. More like soldiers in a com [...]

Concrete Solutions"We want to take the atmosphere back to its pre-industrial chemistry as quickly as possible. Fo [...]

The folks at Windward have been doing great work at living sustainably for many years now.  Part of [...]

 The Daily SUN☼ Building a Better Tomorrow by Sustaining Universal Needs April 3, 2017 Powering Down [...]

Off the keyboard of Bob Montgomery Follow us on Twitter @doomstead666 Friend us on Facebook Publishe [...]

Visit SUN on Facebook Here [...]

In the echo-sphere of political punditry consensus forms rapidly, gels, and then, in short order…cal [...]

Discussions with figures from Noam Chomsky and Peter Senge to Thich Nhat Hanh and the Dalai Lama off [...]

Lefty Greenies have some laudable ideas. Why is it then that they don't bother to really build [...]

Democracy and politics would be messy business even if all participants were saints. But America doe [...]

A new book argues that, in order to survive climate change and peak oil, the global money economy ne [...]

Top Commentariats
  • Our Finite World
  • Economic Undertow

Yes, perhaps you're right. Best bet is to be far away from built-up areas, were most of the fig [...]

Let's put ourselves in the shoes of these pleasant young fellows. One day --- we get a situatio [...]

in germany big solar have a throttle function, so the grid operator can descide how much solar is us [...]

Wrong. Those who have lead this civilization into collapse should be the first to suffer from it [...]

If they were starving FE, they wouldn't have the energy for this sort of thing. About the most [...]

Welcome to new day, added 's' to 'http' so everyone should feel more secure ... [...]

Just to be clear about all the different administrations mentioned; All the while not one thing that [...]

Clintons job was to keep the party going, BJs under the desk for all! Bushs job was to tell jokes an [...]

Hey Steve, why don't you look into becoming REs neighbor. After the great power down, you can l [...]

Think Vermont. All you need is a wood stove and an internet connection. I'll bet you have a lot [...]

RE Economics

Going Cashless

Off the keyboard of RE Follow us on Twitter @doomstead666...

Simplifying the Final Countdown

Off the keyboard of RE Follow us on Twitter @doomstead666...

Bond Market Collapse and the Banning of Cash

Off the microphone of RE Follow us on Twitter @doomstead666...

Do Central Bankers Recognize there is NO GROWTH?

Discuss this article @ the ECONOMICS TABLE inside the...

Singularity of the Dollar

Off the Keyboard of RE Follow us on Twitter @doomstead666...

Kurrency Kollapse: To Print or Not To Print?

Off the microphone of RE Follow us on Twitter @doomstead666...

SWISSIE CAPITULATION!

Off the microphone of RE Follow us on Twitter @doomstead666...

Of Heat Sinks & Debt Sinks: A Thermodynamic View of Money

Off the keyboard of RE Follow us on Twitter @doomstead666...

Merry Doomy Christmas

Off the keyboard of RE Follow us on Twitter @doomstead666...

Peak Customers: The Final Liquidation Sale

Off the keyboard of RE Follow us on Twitter @doomstead666...

Collapse Fiction
Useful Links
Technical Journals

Northern Thailand has been experiencing the impact of climate change due to its fragile agro-ecosyst [...]

Agriculture is quite sensitive to climate change and to date it has been impacted in many ways. In t [...]

There is evidence that access to green spaces have positive effects on health, possibly through bene [...]

The objectives of this study are to use a clustering technique to identify homogeneous rainfall regi [...]

Follow on our http://www.doomsteaddiner.net/forum/