Article: Shell rings warning bell on peak oil, out-of-control emissions

[ozbob]

From the Transport & Logistics News click here!

Shell rings warning bell on peak oil, out-of-control emissions

Shell rings warning bell on peak oil, out-of-control emissions

Shell has issued a warning that by the end of the decade growth in demand for oil will outstrip production, and that slowing the rate of emissions will become increasingly difficult.

The company has this week published 'Signals and Signposts', a report into future energy scenarios that offers a deeper understanding of global developments and the world's energy supply, use and needs.

"Signals and Signposts updates our thinking by taking into account the impact of the global economic and financial crisis," the company said. "Over the next four decades, the world's energy system will see profound developments. Heightened collaboration between civil society and the public and private sectors is vital if we want to address economic, energy and environmental challenges. Partnerships must be grounded in commercial reality, but energy and environmental developments have to accelerate in the right direction. We must widen and deepen the debate across industry and geographical boundaries."

Shell has provided the following summary:

We believe that the world is entering an era of volatile transitions and intensified economic cycles. The recession interrupted the oil and commodity price boom but it may return. Emerging nations like China and India are going through materially intensive development and a tighter market will continue to put pressure on prices and generate volatility. Improvements in policy-making and strong gains in productivity have helped economies to grow without inflation in the last two decades. We do not believe the moderating effect of this combination of good policies, good practices, and good luck will continue into the future.

We are seeing a step change in energy use. Developing nations, including population giants China and India, are entering their most energy-intensive phase of economic growth as they industrialise, urbanize, build infrastructure, and increase their use of transportation. Demand pressures will stimulate alternative supply and more efficiency in energy use — but these alone may not be enough to offset growing demand tensions completely. Underlying global demand for energy by 2050 could triple from its 2000 level if emerging economies follow historical patterns of development.

In broad-brush terms, natural innovation and competition could spur improvements in energy efficiency to moderate underlying demand by about 20% over this time. Ordinary rates of supply growth -- taking into account technological, geological, competitive, financial and political realities -- could naturally boost energy production by about 50%. But this still leaves a gap between business as- usual supply and business-as-usual demand of around 400 EJ/a – the size of the whole industry in 2000. This gap – this Zone of Uncertainty – will have to be bridged by some combination of extraordinary demand moderation and extraordinary production acceleration.

Supply will struggle to keep pace with demand. By the end of the coming decade, growth in the production of easily accessible oil and gas will not match the projected rate of demand growth. While abundant coal exists in many parts of the world, transportation difficulties and environmental degradation ultimately pose limits to its growth. Meanwhile, alternative energy sources such as biofuels may become a much more significant part of the energy mix — but there is no "silver bullet" that will completely resolve supply-demand tensions.

Smart urban development, sustained policy encouragement and commercial and technological innovation can all result in some demand moderation. But so can price-shocks, knee-jerk policies and frustrated aspirations. Timescales are a key factor. Buildings, infrastructure and power stations last several decades. The stock of vehicles can last twenty years. New energy technologies must be demonstrated at commercial scale and require thirty years of sustained double-digit growth to build industrial capacity and grow sufficiently to feature at even 1-2% of the energy system. The policies in place in the next five years shape investment for the next ten years, which largely shape the global energy picture out to 2050.

The global economic crisis has coincided with a shift in geopolitical and economic power from west to east. This decisive shift is transforming the global economic and political system. The change is gradual, but its potential consequences are profound. The economic crisis in the west may accelerate this trend. Future generations may see 2008 as the turning point. The world faces a period of uncertain global politics. Strategic fault lines are emerging. Rising powers are increasingly and confidently asserting what they see as their national interests. This is undermining global mechanisms for ensuring collective security.

Environmental stresses are increasing. Even if it were possible for fossil fuels to maintain their current share of the energy mix and respond to increased demand, CO2 emissions would then be on a pathway that could severely threaten human well-being. Even with the moderation of fossil fuel use and effective CO2 management, the path forward is still highly challenging. Remaining within desirable levels of CO2 concentration in the atmosphere will become increasingly difficult.

You can download the full document here.

[colinw]

I note that other oil companies have issued similar warnings.  Despite that, I expect the "head in the sand" brigade (including one or two who post here) will continue to deny there is a problem, and will still insist that personal mobility in single occupant vehicles is the only way things could possibly be.

[Jonno]

I love the "by the end of the decade demand will outstrip production".  Demand outstripped production abbot 10 years ago.  By the end of the decade it will gave completely dwarfed production not outstripped it!

[Stillwater]

For years, Australia's Office of the Chief Scientist has been a pretty sedate place as the occupant of the position has gone about providing independent advice to the Prime Minister and government of the day on scientific matters.
So, you would have to get worries when the current Chief Scientist, Professor Penny Sackett, resigns half way through her five-year tenure, ostensibly due to a profound disagreement with the Government over climate change policy.

http://www.chiefscientist.gov.au/

[Zoiks]

For years, Australia's Office of the Chief Scientist has been a pretty sedate place as the occupant of the position has gone about providing independent advice to the Prime Minister and government of the day on scientific matters.
So, you would have to get worries when the current Chief Scientist, Professor Penny Sackett, resigns half way through her five-year tenure, ostensibly due to a profound disagreement with the Government over climate change policy.

http://www.chiefscientist.gov.au/

To clarify this, her profound disagreement was with the governments decision to delay the ETS. "'Any action that is delayed puts us at higher risk of dangerous climate change."