The Economics of Unconventional Oils (externalities be damned)

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Published on The Doomstead Diner on July 13, 2017

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The Economics of Unconventional Oils (externalities be damned)

There are a multitude of reasons why the pursuit of unconventional oils represents obscene
environmental vandalism. It is homicide, suicide and ecocide. Water table contamination, surface
water contamination, destruction of arboreal and agricultural land and the triggering of earthquakes
are well known consequences. The carbon emissions are markedly greater than conventional oil
production and will vastly increase the probability of near term human extinction from climate
Irrespective of the trivial matter of human extinction, the purpose of this article is to focus on short
term profits, the only matter of interest to those vocal local yokels in politics and the media. This
article aims only to assess the economic viability of unconventional oils in a capitalist market, while
blithely disregarding any externalities they impose. Let us look at the pursuit of unconventional oils
solely as a cold blooded business proposition from the point of view of a self serving psychopath
interested only in short term greed. To hell with the suffering and death of most species on this
planet or the well-being (or even existence of) future human generations.
In this article I acknowledge key energy thought leaders such as Hall, Murphy and Lambert and
especially Louis Arnoux whose "five fingers of net energy allocation" metaphor I previously
borrowed and modified. I also acknowledge bloggers that have helped clarify concepts about
EROEI and net energy who I may have inadvertently borrowed from. Nicole Foss likened
harvesting unconventional oils to sucking dirty drops of stale beer out of a floor mat, a useful,
graphic and memorable image. However analytical readers may want a more quantitative argument
before they can be convinced about the economic worth or otherwise of unconventional oils.
Let us start from first principles: (for further explanations and graphs regarding energy and
climate concepts, please see )
1. Material wealth can be defined as having easy access to a wide variety of high quality goods
and services
2. Material wealth in our industrial economies is derived almost entirely from our energy
utilisation of fossil fuels, whether directly e.g. jet fuel for planes, coal for electricity
generation; or indirectly e.g. fossil fuels used to construct nuclear power plants or so-called
renewable energy projects. Human and animal muscle power pale into insignificance when
compared with the vast energy capacity of fossil fuels to manufacture and deliver our
modern day goods and services. Mass agriculture is also utterly dependent on fossil fuels.
3. Petroleum is the king of all fossil fuels in terms of its utility, flexibility and energy density. It
constitutes many essential, irreplaceable links in our industrial manufacturing and supply
chains. Without those links, the chains are shattered and industrial civilisation grinds to a
halt. We have no large scale replacement for conventional petroleum. None.
4. The richest, the most valuable sources of oil have been the conventional oilfields prior to, at
and shortly after peak production (rich being defined as bearing oil which is easy to extract
and refine and is quantified as having high EROEI, which is energy returned divided by
energy invested). Conventional oilfields start out being rich (high value fields) and
inevitably become poor (low value fields), with plummeting EROEI on the down slope of
the Hubbert curve as they deplete. EROEI defines the value of an oilfield2
5. Net energy is energy returned minus energy invested and is analogous to net income. Gross
income is meaningless. It is only after we have deducted business expenses, loan
repayments, taxes etc. from our gross income that we can calculate our net income and
know our true wealth (or poverty) and our true purchasing power. A high net income allows
generous allocation for many different expenditures including luxuries and fripperies. That
is what it means to be rich. A low net income forces us to contract our previously complex
lifestyles, to simplify our lives and to focus on basic needs. That is what it means to be poor.
High and low net energy availability are exactly analogous to high and low net incomes. Just
as gross income is meaningless, gross energy production is meaningless. Therefore all
those fancy looking graphs published by IEA, EIA, CERA, USGS etc which only report
gross liquid hydrocarbon production nowadays are meaningless. On the upslope of the
global Hubbert curve in the old days of high EROEI, i.e. before 2005/6, it was reasonable to
treat world gross oil production as being roughly equivalent to net oil availability. Now that
we are well down the global Hubbert curve in 2017, any figures and graphs that only report
gross oil production and do not at least attempt to estimate net oil availability must be
regarded as fraudulent. Even if world gross oil output appears to be the same in 2017 as it
was in 2005, if our net oil availability has halved, then the FACT is that we have lost half
our wealth. Net energy availability defines the material wealth and complexity of a
society. As net energy availability declines, industrial society becomes materially poorer and
is forced to simplify and to focus on basic needs3. Complex technological systems are
inevitably lost because it is no longer possible to allocate energy to support them. Pension
plans, promises of future retirement payments based on old, false assumptions of endless
future economic growth, will never be delivered.
6. Industrial societies are becoming materially poorer and are being forced to simplify as
net energy availability declines. This is happening right now. This is an utterly
inescapable fact, a law of physics as absolute and as certain as the law of gravity, no
matter what any mainstream economist or politician (= deluded idiot who talks about "return
to growth") will have you believe. The pie is shrinking, however one particular glutton is
hell-bent on keeping “their” slice of the pie the same size as back in the “good-old-days”
before Peak Oil. In a zero sum game, this can only achieved by escalating their background
activities of fraud, theft and murder – otherwise known as propping up the US petrodollar
and intensifying US "regime change" foreign policy. This arrogant sense of entitlement is
now hugely increasing the risk of global nuclear conflict4. The only possible way we can
maintain global peace is to educate everyone about the inevitability of our energy descent
and implement voluntary and fair reduction of fossil fuel use by everyone, everywhere. Such
reduction is inevitable, the only question is whether we pursue systematic, planned
reduction or whether we go cold turkey and collapse into violent chaos. Maintaining peace
will require a miraculous mass epiphany and widespread magical transformation eg America
turning into a socialist, rural, agrarian, non-violent society – everybody essentially becoming
Amish. Judging by the quality of our current so-called “leaders”, including the ignorant
and/or stupid and/or corrupt “knowledge leaders” in the universities, and the clueless,
deluded, sedated and distracted general public who blame “the other” for all their problems,
chaotic collapse is a dead certainty (dead being the operative word, die-off being the
operative phrase).
7. Net energy availability falls of a cliff when EROEI falls below 5:1, however industrial
collapse will occur some time before that (according to calculations by many energy
experts). Indeed economic stagnation and contraction occur when EROEI falls to around
10:1 (which is happening now) and that alone can trigger sudden financial/economic
collapse (and/or warfare) before further EROEI decline is able to occur. In other words if
EROEI declines to, say, 9:1 and society collapses, oil output will then suddenly drop to
virtually zero, rather than following a theoretical smooth downward curve with
progressively declining EROEI ratios.
8. Many pundits have stated that money is a proxy for energy. At face value this sounds
reasonable, given that money is a proxy for goods and services and the production/delivery
of all goods and services are mediated by energy. However such a premise also assumes a
fair "level playing field" market with all parties being treated equally (no government
subsidies or sweetheart bank loans to favoured sons) all parties facing perfect competition,
with everyone behaving rationally, applying sane valuations to all goods and services, with
perfect information available to them at all times and with honest interaction between them
(assumptions made by neoclassical, neoliberal capitalist economists who live in a theoretical
world and have zero understanding of the real world).5
With those considerations in mind, let us assess the economic viability of conventional versus
unconventional oils using simple arithmetic:
If one US dollar is the proxy for one litre of oil6 and I invest one dollar in a pristine conventional
oil field with an EROEI of 100:1, I will get a gross return of $100 and a net return of 100 minus 1
or $99. This is my profit or net income, a huge windfall.
As the oil field ages, even though the total production of oil rises exponentially on the upslope of
the Hubbert curve (and absolute profits skyrocket), the EROEI and net profit per dollar invested
inevitably decline, albeit imperceptibly at first. At peak oil production the EROEI may be perhaps
18 or 20:1. Beyond peak, on the depletion side of the curve, even with an EROEI of 10:1 the profit
is still reasonably good. A $1 investment now provides a gross return of $10 and a net return of $9.
Conventional oil fields typically produce prolifically for several decades and after peak may decline
by about 6% per year.
Let us consider an unconventional oil source now. Calculations of EROEI vary, with wild
overestimates by oil industry pundits, but full life cycle analyses of unconventional oils show them
to be universally dismal whether they be shale oil, tar sands or Fischer-Tropsch (gas to liquid or
coal to liquid) oil. Tar sands probably have EROEI of 3:1 or less. Shale oil EROEI is at best around
3:1 in a pristine shale oil "play" in the middle of a “sweet spot”. Often hundreds of exploration
drillings are required before suitable “sweet spots” are located. All that unproductive drilling
activity takes energy (which has not been taken into account in many studies, hence shale oil
probably has a true EROEI well under 3:1). Hydraulic fracturing is very energy intensive. There is a
reason why shale oil is also called “tight” oil. The impermeable kerogen rock holds tightly on to its
oil, only giving it up when subjected to violent fracturing by high pressure injection of chemicals
and sand. Shale plays reach peak output quickly e.g. within 5 years of starting production. Just 3
years after peak production they have typically depleted by 80-90%.
If we think of money as a proxy for energy, that means if I invest $1 in the best brand new shale oil
play, I get $3 gross return and $2 net return. However any “profit” is entirely fleeting due to rapid
depletion. Furthermore the fact that all such scams are deeply mired in irredeemable debt from day
one, means that over their lifetime, their books can never balance. Compare that return with a $9 net
return for a depleting but debt free post peak conventional oil field with EROEI 10:1. This means
that only an idiot would ever invest in a shale oil company compared with a conventional oil
company, even if the reserves of the latter were depleting7.
The ONLY way unconventional oil economics can ever be on par with conventional oil economics
is when conventional oil EROEI falls to 3:1, however complex industrial civilisation simply cannot
function at such a low EROEI, it will collapse well before then. This means that the technological
capacity to harvest unconventional oil (a difficult and complex process) will be unavailable then.
Hence unconventional oil will NEVER be economically competitive with conventional oil.
Looking at things another way: For high EROEI oilfields, production costs are low and their oil can
be sold cheaply while still enabling them to repay previous modest capital expenditures, allowing
them to become debt free and to make a good profit over their lifetimes. For low EROEI oilfields,
production costs are high from day one and their oil must be sold dearly in order to repay their high
capex before they can ever become profitable. So long as conventional oil has a higher EROEI than
unconventional oil, it will ALWAYS be cheaper to produce conventional oil, which will ALWAYS
be priced lower than unconventional oil in a properly competitive market8. Unconventional oil will
ALWAYS be priced out of a truly free market and can NEVER be economically competitive.
Note that such considerations depend only on EROEI and are utterly independent of the
contemporary, extant price of oil. Those pundits who state that if only oil prices rise again to,
say $100 or even $150 per barrel, that unconventional oils will then become economically
viable, are dead wrong. If the price of oil rises, the exploration and production costs of
unconventional oil will also proportionately rise and any financial returns will never be able to
repay capex, ensuring that unconventional oil will always be uneconomic.
In a bogus “free” market, unconventional oils will always have to be sold below production cost
i.e. sold at a loss, if they are ever to be sold at all. The losses are borne by sucker investors and a
taxpaying public who were unwittingly duped into subsidising those scams. Capex loans for
unconventional oil projects can never and will never be repayed. This brings to mind the old joke:
Q: What is the easiest way to make a small fortune? A: Start with a large one
Why then have so many unconventional oil projects been established in North America? Because
their so-called "free” market is NOT a fair "level playing field" transparent market populated by
rational players who value commodities sanely, have perfect information available to them at all
times and who deal with each other in honest ways. Unconventional oil projects have been
surreptitiously subsidised by the unwitting tax paying public (in the form of tax breaks given to
those oily scammers by the government, so their country can achieve "energy independence"). The
North American market is populated by irrational players: greedy banks eager to hand out loans
under ZIRP and QE 9 and stupid investors who base their decisions on bogus information with no
understanding of any big picture issues. All driven by the monstrous fraud and dishonesty pervading
the industry.
Will unconventional oil harvesting die a natural death once sucker investors who have lost their
shirts learn their bitter lesson and no further clueless investors are forthcoming? You can fool some
of the people all of the time, hence snake oil scams will still pop up now and then in the years to
come. As long as this bogus economic system continues to limp along, there will always be one
sector of the population who have more dollars than sense. More than that, however, some
unconventional oil projects will still persist irrespective of any economic “rationalities”, mainly for
military and “energy security” reasons, mandated and pushed through by Deep States which are not
governed by true capitalist principles. That includes the Fascist States of America, which follows
Bernie Madoff type capitalism, not Adam Smith type capitalism.
Let us consider another hypothetical scenario conjured up by the "thousand year shale oil supply"
food fraudster named Geoffrey Annison. Let us imagine that the oil industry spreads its tentacles
worldwide to frack the living daylights out of every shale play they can possibly find, and every
drop of net oil is used to feed "business as usual" industrial scale agriculture. No oil is used for any
other purposes except for agriculture and for the extraction of more oil, not even for military
purposes, in this fantasy scenario. Surely this means that even though the EROEI is very poor at
3:1, but because we allocate oil for no other purposes, we can therefore continue industrial scale
agriculture for another thousand years? Absolutely not. Oil fracking is a high technology activity
requiring complex machinery, complex chemicals (eg special fracking fluids) and complex
processes (eg horizontal drilling) and also requires delivery of all the equipment to remote areas
(with associated housing and logistical support of their personnel) and transport of the oil out. Not
to mention the high tech purification and refinement processes. That all requires a complex
industrial infrastructure (and the manufacture and maintenance of all necessary equipment and
parts, from engines to microprocessors). The existence of such complex industrial infrastructure
requires high net energy sources with EROEI of at least 8 or 9:1. This means that the low EROEI
shale oil industry can NEVER be self perpetuating, it will always require input from higher EROEI
energy sources to operate. It is a monstrous scam. The only "benefit" of unconventional oil
extraction has been to slow the terminal decline of total liquid hydrocarbon output to date, which is
nevertheless poised to fall off a cliff in a few short years to come.
– EROEI defines the value of an oilfield. A high EROEI oilfield is a rich, high value field
that can produce oil easily (=cheaply, if we regard money as the proxy for energy) and is
thus also able to sell its oil cheaply ie at a low break even price (a low price which still
allows for good profit as well as repayment of capex, which ensures overall financial
solvency of the oilfield)
– A poor, low value oilfield has low EROEI, extracts oil with great difficulty (=dearly) and
must sell its oil dearly ie at a high break even price if its debts are ever to be repaid.
– On a “level playing field” free market, unconventional oil can NEVER compete price wise
with conventional oil. If unconventional oil is to be sold at all, it must be sold below
production cost which means that the capex of unconventional oilfields can never be repaid
and they can NEVER be financially solvent and will ALWAYS be lifetime money losers.
– Net energy availability (or more specifically net energy availability per capita per year or
NEA/C/Y 3) is the primary index of true material wealth of a society (secondary indices
being fairness of energy allocation and appropriateness of energy allocation). I assert that
NEA/C/Y is a much better index of material wealth than GDP. Global average NEA/C/Y
is scheduled to plummet catastrophically in the next few years and this will affect different
parts of the world patchily. Russia and Iran, harnessing China's capacity to turn that last
remaining high EROEI energy to wealth (=goods and services), will be less affected in the
short term – unless America fabricates some bogus false flag excuse to launch a “sour
grapes” first strike nuclear attack against them4, which will bring about mutually assured
destruction. Even if by some fluke we are able to escape nuclear Armageddon, ultimately
nobody will be spared from the eventual collapse of fossil fool industrial civilisation.
G. Chia July 2017
partner/ I consider near term human extinction by 2100 due to climate
change related loss of habitat as a real possibility, even a high probability. This probability
increases with every new unconventional oil or gas project pursued. However the meme of
NTHE within nine years by 2026 due to climate change alone is utter rubbish and I have
completely falsified that nonsensical idea in previous essays. Nuclear war can certainly
destroy us any time soon, but that will not represent NTHE caused by climate change alone.
Climate chaos will be just one of several triggers for nuclear war. Reckless brinkmanship
fossil fuel politics (whether oil or pipeline related) i.e. resource depletion related conflict, is
a much more likely nuclear trigger in the short term.
2. EROEI analysis continues to evolve and definitions continue to be clarified. For example if
a depleting conventional oilfield needs X Joules of energy in the form of diesel fuel to run
the saline pumps to extract 2X Joules worth of crude oil, traditionally it would have been
described as having an EROEI of 2:1. The fallacy here is that the crude oil needs to be
transported to a refinery, fractionated into different components and the diesel component
must be trucked back to the oilfield to run the pumps. All those energy costs were
traditionally not taken into account. Such an arrangement may not in fact provide sufficient
net energy return to do any more than pursue a pointless extract-transport-refine-transportextract
loop. Hence an oilfield traditionally designated as having EROEI of 2:1 may in
reality, using honest accounting, have only an EROEI of 1:1 and may therefore be
completely useless apart from accelerating entropy and carbon emissions. Nevertheless
EROEI concepts are fundamentally important for us to work out the thermodynamic worth
of energy ventures and approximate values can be very useful for us to make informed
3. More
precisely the major parameter which defines the wealth of a society is net energy
availability per capita per year or NEA/C/Y (other parameters for wealth definition are the
fairness of energy distribution and the appropriateness of energy allocation). Examples: We
do not regard India as a rich country even though its total net energy availability per year
may be, say, ten times that of a European country. That is because per head of population per
year, the net energy availability may only be one tenth that of the European country – the
average Indian lives in abject poverty. Even if NEA/C/Y of two particular countries are the
same, but if , say, 99% of the wealth of one particular country is corruptly and unfairly
concentrated in the hands of a 1% parasite class, we do not regard that country as rich,
because of the vast majority of the population will be living in poverty. Similarly if energy
(=wealth) allocations are highly inappropriate, then a country cannot be regarded as well off.
If a country allocates the bulk of its wealth to adequate food, water, sanitation, housing,
health, education and environmental governance sectors to benefit everybody, the people
will actually be quite well off eg Bhutan. If however a country allocates the bulk of its
wealth to military expenditure, corporate managerial parasitic activity (eg in the health
insurance industry, the banking sector etc) and bombastic political campaigns, neglecting the
more vital needs of ordinary people, the populace cannot be regarded as being well off.
Short of a popular revolution and complete reform of all their institutions, this is the
inescapable, inevitable fate of the Fascist States of America. Poverty.
4. The USA no longer has high EROEI conventional oil fields and their attempts at achieving
"energy independence" by harvesting domestic unconventional oils have proven to be
spectacular economic failures. Some schemes have been astoundingly idiotic, such as
ethanol from Nebraskan corn. You simply cannot cheat physics and the laws of
thermodynamics, no matter how loud your PR spin. America's greatest fear is the fact that
Russia, Iran and some central Asian states, whose oil output have historically been curtailed
for economic/political reasons, will possess the last remaining high EROEI conventional
fields in the world (relatively high EROEI compared with the rest of the world, however
Russia and Iran are also past peak oil production now). This is because the historically
unrestrained high volume oil producers of Saudi Arabia, Kuwait and the UAE are poised for
economic collapse in the near future, just as Egypt and Syria collapsed when their declining
oil production intersected with their increasing domestic consumption. Iraq is a wild card,
likely to remain in turmoil but just as likely to enter the fold of Iran, because Iraq is mostly
Shi'ite and has suffered terribly from the brutality of ISIS and Al Qaeda offshoot Sunni
Salafists, which were the monstrous creations of the USA and Saudi Arabia. The impending
relative petropower rise of Russia and Iran, with the accompanying decline of the USA, is
why the USA has been so hell-bent on regime change and on installing US puppets in those
countries, employing all manner of fabricated fake news to bring it about. That will not
happen because the world is now wise to the dirty tricks of the CIA. If Russia and Iran liaise
with China (with its massive industrial capacity), if those three trade in their own currencies
and sideline the US petrodollar, that triumvirate will economically dominate the world.
Europe and East Asia will inevitably gravitate towards them. This is in fact happening right
now, especially with the “belt and road” initiatives. The USA, who call themselves the
"indispensable nation" (indispensable to themselves), will be marginalised and will descend
into abject poverty even as the nations they despise and demonise achieve reasonable
"moderate prosperity". This will grate on American sensibilities no end. America will never
be great again but it will certainly grate again, just as it grated under Bush Jr, only worse.
The entrenchment of fanatical chickenshit armchair warmongering right wing psychopaths
in the US administration, irrespective of whichever political party occupies the White
House, bodes ill for the world, particularly as their meme of a "winnable nuclear war" (using
first strikes and theoretical anti ballistic missile shields) continues to bounce around the
hollow echoing corridors of that mental asylum10. The only role the USA now plays in the
world is that of spoiler, mass murderer and probable harbinger of human extinction by
nuclear war. The USA is not simply a schoolyard bully who steals the ball and runs off,
spoiling the game for everybody. The USA is a schoolyard bully who wears suicide bomb
underpants and is planning to detonate it on the playground, believing that their kevlar
jacket will prevent their own head from being blown off.
5. In a hypothetical ideal free and fair market economy, money should be a proxy for energy.
In the real world, that is only partly true. Unfortunately in many cases, money (and most
money exists as digital currency in the stockmarket) represents pure vapour with no value
whatsoever or even negative value as in the case of the collateral debt obligations of the
subprime mortgage scam, which in reality were liabilities, so-called “toxic assets”.
Unconventional oil scams are even more toxic, both literally and figuratively and are only
promoted by fools or liars. “EIA’s projections have been off by wide margins. In 2014 the
agency cut its estimates about the amount of recoverable oil in California’s Monterey shale
by 96 percent. And in 2012, research from the U.S. Geological Survey forced the EIA to cut
its estimates of how much shale was accessible in Poland by 99 percent"
html. It is true that some people made
money from those scams, specifically people who cashed out before those pyramid schemes
reached their peak share price (or from short selling just before price collapse). However the
only people who promote those scams as profitable enterprises are people who should be in
6. This overview is simplified for the sake of explaining certain concepts. Proper detailed
analysis would specify exactly what that one litre of invested “oil” consists of (petrol?
diesel? or a mix?) and that the energy returned should also be in the form of similar refined
fractions, to compare like with like. It should also incorporate the energy costs of crude oil
transportation/refinement and distribution of the refined products.
7. Given the monstrous level of deceit in the oil industry, even investment in conventional oil
nowadays is a money losing prospect due to fraudulently overstated reserves. Consider
Saudi Aramco who tried to sell 5% of their assets in 2016. Despite glossy brochures they
refused to disclose their true remaining oil reserves or allow any inspection. Independent
valuers Wood Mackenzie reckon that Aramco have overvalued their assets by 500%
Overvalued-By-500.html. Few took that bait, hence the 2016 offer fizzled. They will try a
formal IPO in 2018 but only suckers will buy into it. The only sane investment nowadays is
not oil or gold or silver or diamonds but climate resilient land on which you can establish
your off grid permaculture homestead (and the purchase of associated necessary items eg
tiny house, solar panels etc). The only truly valuable currency in the world is the currency of
trust you must build with “aware” people. Unfortunately not all “aware” people are
necessarily trustworthy.
8. It is a different matter if the conventional oil producers unite politically to raise their oil
prices well above production costs to maximise their profits, however they have not done so
in recent years. Indeed they have been using artificially low oil prices as a weapon.
9. Zero interest rate policy only applies to interest on the savings of bank depositors, those
working stiffs who struggle, scrimp and save to put a little something aside for a rainy day in
these difficult times. ZIRP maximises bank profits while screwing the little guy. The banks
of course continue to charge interest on any loans they provide to any borrowers eg
investors in shale oil scams. Those loans are created out of thin air by the fractional reserve
banking system, hocus pocus made ever easier by government quantitative easing policy.
The funny money of QE is also created out of thin air by the government. It does not cause
general inflation because it is money which is unavailable to the general public, only to big
ticket borrowers. It does however cause inflation of share prices in the stockmarket which
feeds ever more irrational exuberance among the Ponzi investors AKA suckers. Whatever
the situation, the banksters will still get their year end bonuses for any loans they hand out,
whether those loans are ever repaid or not. This is the definition of Bernie Madoff
10. In comparing Trump's White House with a mental asylum, I must apologise if I have caused
any offence to any mental asylums.

4 Responses to The Economics of Unconventional Oils (externalities be damned)

  • Davebee says:

    Slightly off topic, but didn't Mr. T just go all wobbly on his Paris Accord rubbishing in addition to now building a see-through Mexican wall and only a partial one at that. See, he's a closet greenie after all.

    I blame it all on that Russkie lawyer chick, I really do.

  • Mister Roboto says:

    I maintian that the only reason this literally filthy scam has been able to persist for so long is because of the fuck-tons of central-bank funny-money that has been flying off the printing presses of the European, Swiss, and Japanese central banks

    over the past year and a half. During late 2015 and early 2016, we were headed into a true deflationary compression that undoubtedly would have been worse than the one that started in late 2008, had it not been for the initiation of this massive financial invtervention that continues with red-hot intensity to this very day. Big finance just keeps rolling over the smelly, aging loans of the fracking/ tar sands scammers, in addition to providing new ones to these same scammers. This would certainly be rather more difficult to keeping doing if it weren't for the torrent of fake money currently flooding the world financial markets from the above-named central banks.

  • Anti Troll says:

    EROI and net energy concepts seem so elementary and obvious and essential for honest accounting but continue to be totally ignored by TPTB, no doubt because honest accounting will destroy their business models which are based on fraud and their claims to political legitimacy, which are also based on fraud. It also destroys the legitimacy of many ivory tower pseudointellectuals in universities because that is also… you guessed it… based on fraud. Steven Pinker is one such establishment "useful idiot" who springs to mind. Fascinating to see how EROI can be applied in different ways.

    Charles Hall started by looking at biological energy flows: the cheetah needs to capture more food calories than it expends in the hunt or it will die: EROI from the POV of an energy user or energy consumer.

    Hall and his proteges then looked at EROI from the POV of energy production, specifically the net energy cliff on the downside of the Hubbert curve. This looked spookily similar to Ugo Bardi's "Seneca cliff", providing quantitative vindication for Bardi's prescient subjective viewpoint. Truly Bardi's curse: to be correct in his judgement but ignored by the establishment. Then again we know that speaking truth is an act of treason in an empire of lies.

    Geoffrey Chia then combined the EROI graph with the land export model graph, producing an even more alarming net energy cliff.

    He now looks at comparisons of EROIs between different oil sources, providing quantitative proof that UC oil projects are economic scams.  It will be interesting to see if EROI concepts can be applied further in even more ways.

  • James T says:

    fantastic sumation Geoffery. Always enjoy your posts.

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Quote from: RE on August 27, 2017, 12:42:58 PMI am [...]

I am still awaiting your apology AG.RE [...]

Agelbert NOTE: Foss IGNORED this October 4, 2013le [...]

Quote from: RE on September 16, 2017, 02:29:59 AMh [...] [...]

The fat lady is on the stage  [...]

China is the largest customer for US oil. Maybe th [...] [...]

You gotta be high on SOMETHING to run into a bug b [...]

Quote from: luciddreams on August 05, 2017, 06:29: [...]

Quote from: RE on August 05, 2017, 01:00:20 AMThe [...]

I have taken a lot of abuse on my opinion of what [...]

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

Of Harvests and Hurricanes By Cognitive Dissonance   Aside from the planting and harvesting of vario [...]

The American Way: Mindless Pursuit By Cognitive Dissonance   It’s actually embarrassing if I’m to be [...]

I apologize for being missing in action for nearly two weeks. July and August are very busy for Mrs. [...]

This and That - Vol. 1 Lines in the Sand By Cognitive Dissonance   When I was younger I would get in [...]

We Are All Going To Die! By Cognitive Dissonance   This one is short and sweet folks. The subject al [...]

Event Update For 2017-09-18 Th [...]

Event Update For 2017-09-17 Th [...]

Event Update For 2017-09-16 Th [...]

Event Update For 2017-09-15 Th [...]

Event Update For 2017-09-14 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 [...]

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Is Apple Acing Chemistry but Flunking Biology?"It used to be that half of all heart patients first report their condition to their physician [...]

Irmageddon"Denial and existential climate threat are a stable pair."Image courtesy Tatyana Tomsickov [...]

The Beauty of Biomass"You probably wouldn’t want to invest in beachfront property at the rate sea level rise and sup [...]

Creative Loafing with Joe the Baker"I just want to make a really good loaf every time."Malthouse Couching by Andrea GentlWhil [...]

Planting A Personal Forest"If you appreciate the effort it takes for a single individual to become carbon-neutral, you ca [...]

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 [...]

Americans are good on the "thoughts and prayers" thing. Also not so bad about digging in f [...]

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 [...]

Top Commentariats
  • Our Finite World
  • Economic Undertow

And theres no getting out of school early; the Catalan situation seems to be warming up again. It is [...]

Got bread and stand on white bitch head. BLM! [...]

With the proviso that the meaning of the word - classification "socialist gov" always mean [...]

According to Forbes the top ten best countries for Business are socialist. According to the scientis [...]

i keep trying to drive home the reality: that democracy and prosperity (for a substantial number of [...]

Hey welome back - can't believe I haven't even looked at EU for nearly three weeks. For a [...]

Tagio said: Steve, if you have time to indulge me, what do you think the effect of the depreciating [...]

The Bakken statistics are still kept: [...]

Steve, if you have time to indulge me, what do you think the effect of the depreciating dollar (103 [...]

Some truth comes out of MSM: "Electrical power is needed, too, to keep water and sanitation sys [...]

RE Economics

Going Cashless

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Simplifying the Final Countdown

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Bond Market Collapse and the Banning of Cash

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Do Central Bankers Recognize there is NO GROWTH?

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

Singularity of the Dollar

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Kurrency Kollapse: To Print or Not To Print?

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

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Merry Doomy Christmas

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Peak Customers: The Final Liquidation Sale

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This study analyzed the trends of extreme daily rainfall indices over the Ouémé basin using the obse [...]

Climate change is prevalent across the world and can have large influence on plant regeneration, rec [...]

This study aims to estimate the influence of atmospheric circulation modes on future Baltic Sea leve [...]

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