The End.

Lord Anubis said:
CTL...is that even viable on a huge scale (global) considering the enormous environmental footprint that it would result in?
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Nah LA, I don't think CTL is a long term solution. It's just that StrongTurd has gotten so fixated on this concept of "peak oil" causing the demise of civilization, that I've been bringing up the options that show we can always get more "oil" if we need. Peak oil isn't going to kill us, if anything we're going to r@pe the planet into some kind of global warming hell a long time before we run out of petroleum products to burn. I think that transitioning to other energy sources will sort us out, but since ST only wants to talk about oil we have to keep coming back to that.
 
km2 said:
Nah LA, I don't think CTL is a long term solution. It's just that StrongTurd has gotten so fixated on this concept of "peak oil" causing the demise of civilization, that I've been bringing up the options that show we can always get more "oil" if we need. Peak oil isn't going to kill us, if anything we're going to r@pe the planet into some kind of global warming hell a long time before we run out of petroleum products to burn. I think that transitioning to other energy sources will sort us out, but since ST only wants to talk about oil we have to keep coming back to that.
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LOL @ transition to other energy sources! That's a good one! The entire global economy is built on cheap light sweet crude. Did you see what happened to investment in green energy since the economic collapse? Every single producer in the Alberta tar sands is scaling back massively to such an extent that Canada's economic growth has stalled. I've got an acquaintance that just got made redundant by Syncrude. He says that people are leaving Alberta in droves due to the jobs in Fort McMurray having dried up completely. The shale oil projects in the US have been put on hold indefinitely.

Vast wind farm projects on both sides of the Atlantic are getting canceled or put on hold left, right and center. Producers of components for industrial wind generators have started retrenching staff. Existing wind farms are standing idle due to excessive maintenance costs and their inability to compete with coal.

A large manufacturer of PV panels in China has gone bust. Others have scaled down to reduced working weeks. The demand for PV panels has all but collapsed.

Biofuel manufacturers are hurting very badly due to their inability to produce energy at $40 per barrel. US biofuel companies are looking for a Federal bailout!

Electric car companies are almost universally in financial crap. Elon Musk from Tesla is addressing angry mobs in town halls while selling his cars at a significant loss. Zap has gone bust. Aptera is in deep trouble even before producing a single car.

Russian oil production has officially peaked in 2008. Mexico's production is in a terminal nosedive and they'll stop exporting oil by 2012. Venezuela has peaked and their oil industry is hurting so bad that they are even considering luring back the Western oil majors in a desperate attempt to stop the decline. The vast Ghawar field in Saudi Arabia seems to have plateaued and is pumping more and more water instead of oil. The only countries that can still really increase production are Iran, Saudi Arabia, Nigeria and maybe Kuwait. All the others have peaked.

Almost all deep water projects (with the exception of those off the coast of Brazil) have been put on hold recently. It is currently just not viable to invest many billions bringing new sources online when you can only break even at $110 per barrel. Investment in the oil services industry has plummeted. When demand recovers, supply will be put under even bigger strain due to the current lack of investment.

It could even be argued that peak oil will never again actually become an issue due to the world economy's inability to tolerate $150 oil. Every time demand recovers somewhat, prices will shoot up again causing another economic collapse. It has been proven very vividly that the world economy ceases to function at those kind of prices. The actual peak in world oil production will then never become the driving force in shaping our destiny because demand will never be allowed to recover sufficiently to really start taxing supplies. Either way, we're screwed.

Once again, please would you identify this energy source that is going to compete with LSC on abundance, price, portability, energy density and EROEI. To the best of my knowledge no likely candidate has even been identified let alone exploited commercially. And therein lies the rub: If you can't come up with a sub-$100 alternative to LSC, then you can't maintain a 6.5 billion world population. Simple as that.
 
With reference to my previous post here's a link that I stumbled across juyst this morning that shows the scale of the cutbacks in spending on energy projects caused by the crash of oil prices. All of these projects would have been viable and profitable at >$120 oil prices. Trouble is, none of them are viable at $40 per barrel. Catch 22.

Jan 28 (Reuters) - The deepening of the global financial crisis and the sharp drop in energy prices have forced companies to scale back spending and delay projects, with expensive ventures in the Canadian oil sands hardest hit.

Below is a list of projects that have been delayed or scaled back in recent months, as well as other related news.

Jan 28- Australian Worldwide Exploration Ltd (AWE) will see production fall by about 10 percent in fiscal 2009 on weaker output from its main field, while the drop in oil prices will hurt its profits, the oil and gas company said.

Jan 22 - Peru's state-owned energy company Petroperu S.A. has placed under review a $1 billion plan to modernize its Talara refinery because of low crude oil prices, Peru's mining and energy minister said. The project would raised the refinery's capacity to 90,000 barrels per day from 62,000 bpd.

Jan 20 - Suncor Energy Inc (nyse: SU - news - people ), Canada's No. 2 oil sands producer, halts construction of its C$20.6 billion oil sands expansion called Voyageur, including the planned upgrader and new stages of its steam-assisted production operation known as Firebag. Suncor also halves its previously lowered 2009 capital spending budget to C$3 billion.

Jan 19 - The $2.2 billion Al Dur power and water project in Bahrain is delayed. The Al Dur project is 50 percent owned by the Gulf Investment Corp, with France's GDF Suez owning the other 50 percent.

Jan 17 - Canada's Enbridge Inc (nyse: ENB - news - people ) shelves plans for a C$346 million ($277 million) pipeline reversal that would have shipped 170,000 barrels per day of oil sands crude from Sarnia, Ontario, to a tanker port in the state of Maine, supplying refineries in Montreal en route and replacing the imported oil the line now carries.

Jan 13- Russian oil pipeline monopoly Transneft said contractor problems caused by the global financial crisis pose a threat to its launch of a major oil route to China this year.

Jan 9 - Suncor delays a C$120 million expansion of its St. Clair ethanol plant at Sarnia, Ontario, scheduling completion for 2011 instead of late 2009.

Jan 8 - Hit by falling oil prices, Ecuador plans to delay some gas and oil projects while it seeks loans and investment to boost the OPEC nation's key sector, Oil Minister Derlis Palacios said.

Jan 5 - North Sea gas pipeline operator Gassco says the 10 billion crown ($1.81 billion) Skanled gas pipeline project to Scandinavia could be delayed from its planned 2012 launch, partly due to worries over investment plans by British chemicals group Ineos, a key client.

Dec 19 - Italian energy group Eni delays its decision on picking a floating production storage and offloading (FPSO) unit for the Goliat oil discovery in the Barents Sea from its end-2008 deadline.

Dec 17 - Indonesian state oil firm Pertamina, state power firm PT Perusahaan Listrik Negara (PLN) and PT Perusahaan Gas Negara (PGN) delay the construction of Indonesia's first LNG receiving terminal.

Dec 15 - Canadian oil producer Connacher Oil and Gas Ltd slows bitumen production at its Great Divide thermal oil sands project to 5,000 barrels per day from 9,000 bpd and suspends construction of its second thermal oil sands development, the C$345 million Alger project.

Dec 8 - Santos Ltd (nasdaq: STOSY - news - people ), a partner in the A$850 million ($605.4 million) Reindeer gas project off Australia's west coast, says it has been deferred indefinitely after a proposed customer failed to commit to a sales contract.
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Interesting article on the possible outcome of the financial bailout:

Fast forward to Washington’s day of reckoning and you will see how the bailout game could end:

On that day, Washington will have to either pay rates of interest that wound paralyze, and virtually KILL the economy … or it will have to slash and even abandon its bailout efforts.

Ultimately, it will have no choice but to step aside and let failing companies fail … collapsing industries collapse … and sinking markets sink.

The carnage will be traumatic and terrifying. But it will also be the beginning of the end of the crisis. Once trillions in toxic debt are swept away, America will finally be ready to lay the foundations upon which this economy can grow for decades to thereafter.

In the meantime, though, if you thought 2008 was a nightmare, brace yourself. The months ahead are likely to be far more brutal than anything we’ve seen so far.
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I've stumbled upon a sobering remark made just hours ago in Detroit by Irv Miller, group vice president for Toyota USA:

Last summer’s four-dollar-a-gallon gasoline was no anomaly. It was a brief glimpse of our future. We must address the inevitability of peak oil by developing vehicles powered by alternatives to liquid-oil fuel, as well as new concepts, like the iQ, that are lighter in weight and smaller in size. This kind of vehicle, electrified or not, is where our industry must focus its creativity.
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It is interesting to note that Toyota is taking peak oil seriously and is basing their future product strategy around it. If the reality of peak oil has reached this level of acceptance in corporate strategy (at least in progressive companies like TMC), then there might be a glimmer of hope yet. In fact, it was exactly this type of progressive thinking since the early 90s that made Toyota the envy of the world's motor manufacturers with regards to hybrid technology.

The Big 3, on the other hand, did not nearly have the same level of forward planning and are now having to frequent Washington, hat in hand, in a desperate struggle to remain in existence.
 
This thing is falling apart at a staggering pace. Eastern Europe's bad debt might just be the final nail in the coffin of the Western financial system:

Failure to save East Europe will lead to worldwide meltdown

Austria's finance minister Josef Pröll made frantic efforts last week to put together a €150bn rescue for the ex-Soviet bloc. Well he might. His banks have lent €230bn to the region, equal to 70pc of Austria's GDP.
"A failure rate of 10pc would lead to the collapse of the Austrian financial sector," reported Der Standard in Vienna. Unfortunately, that is about to happen.

The European Bank for Reconstruction and Development (EBRD) says bad debts will top 10pc and may reach 20pc. The Vienna press said Bank Austria and its Italian owner Unicredit face a "monetary Stalingrad" in the East.
Mr Pröll tried to drum up support for his rescue package from EU finance ministers in Brussels last week. The idea was scotched by Germany's Peer Steinbrück. Not our problem, he said. We'll see about that.

Stephen Jen, currency chief at Morgan Stanley, said Eastern Europe has borrowed $1.7 trillion abroad, much on short-term maturities. It must repay – or roll over – $400bn this year, equal to a third of the region's GDP. Good luck. The credit window has slammed shut.

Not even Russia can easily cover the $500bn dollar debts of its oligarchs while oil remains near $33 a barrel. The budget is based on Urals crude at $95. Russia has bled 36pc of its foreign reserves since August defending the rouble.
"This is the largest run on a currency in history," said Mr Jen.
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Here's an interesting comment that I saw on another forum about this situation:

The exposure the EU Banks have to bad debt in the old Soviet States is HUGE, bigger than the sub-prime fiasco. You can think of loaning money to all those old Soviet States like loaning money to a house buyer with no credit rating, except on a much larger scale. Money was loaned to these countries, they can't pay it back. So what to do now? How do you Foreclose on a COUNTRY? If the EU Banks have to write down all the bad loans to the old Soviet client states, their balance sheets will be toilet paper and the Euro as worthless as the Dollar. The reason the Dollar isn't depreciating against other currencies is that they are all being turned WORTHLESS at the same time!

Count Down to Armageddon folks! Something's gotta give here pretty soon.
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Really, one has to be blind not to realise that we are in the biggest financial mess since the dawn of the industrial revolution and that it will take a miracle to save us from doom.
 
Does not make sense

StrongTurd said:
The reason the Dollar isn't depreciating against other currencies is that they are all being turned WORTHLESS at the same time!
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Please could you explain this a bit? A currency's worth is defined relative to other currencies. How do they all become worthless? I could understand if there was world-wide hyper-inflation, but there is in fact deflation taking place. Things are becoming cheaper; the same amount of money is buying you more goods in many places. :confused:
 
JayM : of course it doesn't make sense, because its trying to simplify a global economic system that is so complex that nobody understands every bit of it anymore.
 
JayM said:
Please could you explain this a bit? A currency's worth is defined relative to other currencies. How do they all become worthless? I could understand if there was world-wide hyper-inflation, but there is in fact deflation taking place. Things are becoming cheaper; the same amount of money is buying you more goods in many places. :confused:
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The major currencies are staying relatively stable against each other but NOT against gold. As you would have noticed, the gold price did not collapse when almost all other commodities and precious metals did. Sure it went down but not nearly as much as other commodities.

The main problem is that the dollar and the Euro are both fiat currencies as their values are not linked to gold. It is in effect just a piece of paper backed by the US Fed's "promise to pay" i.e. based on good faith. It has no intrinsic value. If people lose faith in this "promise" the currency rapidly loses value.
 
StrongTurd : no currency is floated with Gold anymore... they all dropped the Gold standard YEARS ago. All currencies are fiat currencies now.
 
How exactly would it have made any difference?

Gold standard or not, the current economic crisis would have happened... and this so-called "peak oil" thing would have either happened or not as well...
 
StrongTurd said:
The major currencies are staying relatively stable against each other but NOT against gold. As you would have noticed, the gold price did not collapse when almost all other commodities and precious metals did.
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Why would this be a problem if one is not buying gold?
 
Here's an interesting article that addresses why a faith-based currency backed by an insolvent country's "promise to pay" is a recipe for total economic collapse. I encounter new articles similar to this one almost daily. This one has a nice table that explains exactly how bad the situation is when things like social security commitments and health care are added to the US governments total debt obligation. Worth a look.

Anyways, this guy calculates the USA's debt-to-GDP ratio at 680%!

If the entitlement shortfall is some 4 times larger than the economy and it is increasing by nearly 5% per year. Then for the entitlement shortfall to remain in proportion to economic growth, the US GDP would have to be increasing at nearly 20% per year.

Sorry folks, that's just flat out impossible. The main reason I refer to the US as "insolvent" is because that's what it is. This data proves it beyond any shadow of a doubt. Any solutions by this next administration, or any to follow, must start with this simple conclusion or risk being tagged as a "deck chair rearranger" by future historians.
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StrongTurd said:
Here's an interesting article that addresses why a faith-based currency backed by an insolvent country's "promise to pay" is a recipe for total economic collapse. I encounter new articles similar to this one almost daily. This one has a nice table that explains exactly how bad the situation is when things like social security commitments and health care are added to the US governments total debt obligation. Worth a look.

Anyways, this guy calculates the USA's debt-to-GDP ratio at 680%!
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Who does the US owe all these trillions to?
 
JayM said:
Who does the US owe all these trillions to?
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China, Japan and OPEC mainly. I saw recently that a senior Chinese banker said that they (China) hates the USA for continually having to buy worthless US T-bills in a desperate effort to keep the whole scheme going.
 
Never mind how, who, where, when just go raid your local store for cans of baked beans and get your shovel
 
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