In June 2000, after a five-year study, the U.S. Geological Survey (USGS) raised its previous estimate of the world's crude oil reserves by 20 percent and claimed that the largest reserves of undiscovered oil lie in existing fields in the Middle East, the northeast Greenland Shelf, the western Siberian and Caspian areas, and the Niger and Congo delta areas of Africa. Many economists and industry representatives breathed a sigh of relief! We weren't running out of oil after all. Unfortunately, even a six-year-old child can see USGS study isn't worth the paper it's printed on. Here are the two simple facts:

The peak year for global oil finding 1962. Since then, the global oil discovery rate has dropped sharply in all regions.

Since it is physically impossible to "produce" more oil than one discovers, global oil production must "peak" in ten years or less:

That's it -- it's that simple. Since it is physically impossible to "produce" more oil than one discovers, global oil production must "peak" in ten years or less.

The US State Department certainly understands oil depletion even if the USGS doesn't. In fact, as early as 1968, the US State Department was giving the straight scoop to foreign governments about the Hubbert curve:

"In 1968, the State Department sent word to foreign governments -- American oil production would soon reach the limits of its capacity. Friendly governments needed to know that the cushion of U.S.'s extra capacity, which could be called into production during an emergency, was about to disappear. The end of an era was at hand." [ p. 3, FUTURE ENERGY: A Report of the Energy Project at the Harvard Business School; Robert Stobaugh & Daniel Yergin, eds., Random, 1979; ISBN 0-394-50163-2 ; http://www.amazon.com/exec/obidos/ASIN/0394710630/brainfood.a ]

But even though the State Department was warning foreign governments, even years later, the USGS was still busy bullshitting the folks back home:

"During the same time period that Hubbert was publishing his 1962 and 1967 analyses, a series of official government estimates of future petroleum availability were released, primarily by the USGS (Zapp, 1961, 1962; Hendrick, 1965), which were many times higher than Hubbert's projections (Figure III.5). The USGS method of assessment throughout the 1960s and early 1970s was primarily a form of a volumetric yield model developed by Zapp (1962). The so-called Zapp hypothesis is based on the assumption that since oil is discovered only through drilling, exploration for oil would not be complete until all potential oil-bearing regions had been drilled intensively enough to reach a well density that would leave virtually no fields undiscovered. Zapp and his colleagues estimated that this would require an overall density of one well per 2 mi2, drilled to either the basement of the sedimentary rock or 20,000 ft. Implicit in this approach is the important assumption that oil would continue to be found at a constant rate of about 118 bbl per foot of exploratory drilling, the mean rate up to that time. Hence, the validity of Zapp's and the USGS estimates is dependent on the validity of the hypothesis that, on the average, the finding rate for oil would continue to remain relatively constant over time. Based on this model, Zapp estimated that about 590 billion bbl of crude oil would be produced in the United States. It is possible, however, that this high value should not be attributed to Zapp for he died at about the time these estimates were released and hence had no chance to revise or update his original analysis. Thus Zapp, a serious and scholarly scientist, may have been treated poorly by history because of the actions of others-something we may never know because of his untimely death. The Zapp hypothesis, with slight modifications, was the primary theoretical basis for all USGS estimates until the mid-1970s." [ p. 344, ENERGY AND RESOURCE QUALITY, by Charles A.S. Hall, Cutler J. Cleveland, Robert Kaufmann, Univ Pr Colorado, 1992; ISBN0-87081-258-0 ; http://www.amazon.com/exec/obidos/ASIN/0471087904/brainfood.a ]

USGS Poster:
At the Second Annual International Business Forum for the Asia Pacific and Indonesian Oil, Gas and Energy sectors, Secretary General of OPEC Rilwanu Lukman said that non-OPEC oil reserves could be depleted in less than 20 years! Moreover, Non-OPEC only holds some 23 percent of the world's proven crude oil reserves, yet account for 60 percent of global production.

See L.B. Mgoon's USGS poster at hubbertpeak.com/magoon/

Jay Hanson

Whatta Hero!

Mizaru, kikazaru, iwazaru.