January 20, 2008

Oil Demand, the Climate and the Energy Ladder - New York Times

The quote below is from an interview with Jeroen van der Veer, the head of Royal Dutch Shell. Note that we do not lack sources of petroleum, despite the common mis-belief that is often promulgated by some media.

People say we have passed the time of 'peak oil,' and that the world's petroleum production is declining. I don't think that's true...yet, but the cost of future oil will continue to rise as the costs of extraction increase.

Q. Fossil fuels are still going to represent the lion’s share of the energy mix in the next century?

A. First, there is no lack in itself of oil or gas, or coal for that matter. But the problem is that the easy-to-produce oil or easy-to-produce gas will be depleted or with difficult access. But if you look at difficult oil or difficult gas, which we in the industry call the unconventionals, such as oil sands or shales, they may be exploitable. But per barrel, you need a lot more technology and a lot more investments, and per barrel you need a lot more brain to produce it. It’s much more expensive.

For me, the most sensible strategy for long term energy efficiency that will minimize any climate change effect is to maximize the uses of electricity, particularly for transportation, and to generate it using nuclear facilities, absent some breakthrough with renewables (solar in particular). Burning fossil fuels seems to be less costly now, but that's because the cost of extraction and distribution is low relative to other options.

Oil Demand, the Climate and the Energy Ladder - New York Times

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