Wednesday, August 03, 2016

Book Review: The Oracle of Oil

The Oracle of Oil
Mason Inman

“A prophet is not without honor except in his own town, among his relatives and in his own home."
Mark 6:4

In 1956 geophysicist M. King Hubbert delivered a paper to the American Petroleum Institute (API) in San Antonio, Texas. His presentation was titled “Nuclear Energy and the Fossil Fuels.” Many of the professional geophysicists, engineers, and energy specialists gathered were expecting a mundane paper comparing the exploration and production costs of nuclear energy to more traditional fuels such as oil. Those members of the audience who had been following the controversial and groundbreaking career of Hubbert were expecting anything but the mundane.

In fact, Hubbert’s paper did shock the industry, as well as his bosses at Shell. Using bell curves and mountains of data gathered from foreign governments and competing companies, Hubbert predicted that global oil would reach “peak production” between 1965 and 1970. In other words, the end of cheap oil was on the horizon. This was akin to walking into the temple and overturning the money changing tables. This was heresy of the highest order. And like all heresies, some facets of Hubbert’s findings remain controversial decades later.

Hubbert arrived at his Peak Production theory by studying the history of American oil wells from their discoveries to their inevitable dry finishes. He then created intricate statistical models that reduced the production history to a bell curve. Over his career he acquired more and more data from American and foreign oil companies enabling him to publish even more detailed studies. Even his opponents respected his methods and credentials. Hubbert taught at Stanford University and Johns Hopkins University and earned a doctorate from Columbia University. He was notorious for double- and triple-checking all his data, and like all competent scientists submitted his finding to other scientists for peer review.

For decades Hubbert was a gadfly buzzing around the doublethink of the oil industry. No other geophysicist wanted to agree with his findings, but they could find no errors in his logic or his math. On the one hand, no scientist would argue that oil was a renewable resource. Yet on a regular basis his critics used the most curious logic to fight him. Richard Gonzalez wrote in the 1956 article "We are Not Running out of Oil":  “There is no way of proving today whether the peak of domestic ability to find and produce oil will be passed in the next ten to twenty years. Domestic petroleum appears to have a reasonably bright future ahead.” In other words, I can’t disprove your formula, charts and graphs, and data points, but you must be wrong.

Publicly, oil magnates, scientists from a variety of disciplines, and the government laughed at Hubbert, but privately they were willing to spend enormous amounts of money and take outrageous risks to guarantee the availability of cheap oil. I was surprised to learn that fracking, or hydrofracking as it was originally called, began in 1948. I was more than surprised to discover that in 1958 Richfield Oil proposed using nuclear bombs to free Canada’s tar sands. It was believed that these tar sands “held as much as 600 billion barrels of oil.” Freeing the tar, or oil, from the sands required huge amounts of heat. Conventional heating methods would cost more than they would produce in oil revenues. I suppose nuclear bombs were, comparatively speaking, cheaper. “In talking with Canadian ambassador, President Eisenhower enthused about the project.” (The government dubbed this plan Project Plowshare; Hubbert called it project Screw-Ball.)

But a good biography of a scientist tells you more than controversy. Inman does an excellent job of showing Hubbert the individual outside the confines of his lab. For instance, Hubbert was interested in applying science not only to the problem of oil supplies, but also to the problem of governance. Technocracy, Inc. was the result of this interest. Late in 1931 Hubbert joined a group of like-minded scientists who believed that engineers and scientists should have a much greater role in the running of the United States economy, and by extension, the United States government. (Yes, they coined the term "technocrat.") Understandably, these views brought him to the attention of the government. In 1943 he was summoned to a hearing of the Board of Economic Warfare. The bureaucrats couldn’t tell if Technocracy was similar to Communism, Fascism, or something entirely different. Under questioning Hubbert quickly revealed that Technocracy would prefer another type of government in America. One BEW member asked if he would like to see “a government with more power than the present one.”

“Decidedly so,” Hubbert replied. It would “combine in the United States Government powers held by the big corporations. I sometimes wonder who is more important, Standard Oil or the United States Government…” In other words, I would like to see a government that truly represents the public on one side and on the other side had the power to really get things done. He was equally unconventional in his private life. He was an atheist and once married a stateless scientist in order to help her gain American citizenship and not be deported.

So have we reached "peak production," or is it somewhere in our future? As Inman says, “Hubbert’s oil forecasts weren’t correct in every detail…but they were strikingly prescient.” Hubbert could not foresee technical advances, e.g., drilling down and sideways to empty previously unreachable wells, or the drilling of shale for gas. And engineers found a method of extracting oil from tar sand that doesn’t involve nuclear radiation. But what most scientists now agree has become painfully clear is that cheap—or conventional—oil has peaked. We are now spending more to reach more inaccessible resources.

David Ryan
Social Sciences/Business, Science and Technology Department
Central Library

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