224. THE USGS PERSPECTIVE

In my opinion, the USGS is unfairly and glibly denigrated in peak oil circles. In response to the criticisms of peak oilers, Ronald R. Charpentier of the USGS has written a presentation entitled The Future of Petroleum: Optimism, Pessimism or Something Else defending the USGS methodology.

This bit is particularly interesting:

Perhaps a more fundamental difference among resource assessors, however, is what can be termed the non-trendologists versus the trendologists. “Trendology” is here considered to be the use of fairly simple statistical extrapolation without consideration of many complicating factors. Many prominent pessimists are trendologists, but that approach is by no means confined to pessimists. The use of simple statistical extrapolation methods has the advantages of being easy, fast, and cheap. These extrapolation methods generally have modest data requirements and can be performed quickly by one or a few persons. More detailed geological assessments, on the other hand, have much larger data and effort requirements. The 1995 USGS assessment of U.S. petroleum resources (Gautier and others, 1995) and the 2000 USGS assessment of non-U.S. petroleum resources (U.S. Geological Survey World Energy Assessment Team, 2000) each required about 100 person-years of work over several years to complete. As many of the prominent trendologists are retired from industry or academia or both, these levels of effort are just not available to them.

He refutes the peak oiler dogma that large fields are found and developed first:

The finding of larger fields early in exploration is not necessarily true at scales other than the play level because larger plays are not necessarily developed earlier. The factors that tend to make larger fields within a play be found earlier do not make the larger plays be developed first. On the contrary, plays tend to be developed in order of ease of exploration and development— often those with shallow reservoirs or easily detectable structural traps are developed first. Some large plays may not be developed until technologic improvements can make them viable.

This is also a very important point:

The potential for new plays cannot be evaluated by statistics alone, but requires more detailed geologic evaluation, which requires considerably more effort. New plays, if they exist, may or may not be of large size. This cannot be evaluated from the basin’s exploration history because, as the previous figure shows, the plays were not developed in order of size.

The above highlights a very weak point in the imminent peak argument. Statistics and trends alone cannot tell you how much oil remains to be discovered. The imminent peaker argument always relies on the unproven and shaky assumption that "the world (or region X) has been thoroughly explored and not much oil is likely to be found." This is just hand-waving, with nothing to back it up. It seems clear to me that the question "How much new oil is likely to be discovered in region X?" should be decided by a detailed survey of the geology of region X, not by past trends in discovery which are influenced by economics. And that is exactly what the USGS has tried to do. Consider, for example, this exhaustive survey of the geology of Saudi Arabia, Kuwait and the surrounding on- and off-shore zones: Total Petroleum Systems of the Paleozoic and Jurassic, Greater Ghawar Uplift and Adjoining Provinces of Central Saudi Arabia and Northern Arabian-Persian Gulf. (I encourage you to thumb through this pdf page by page. You'll find that the USGS knows an astounding amount about the geology and potential of these regions.) Why should we trust Matt Simmons facile comments about Saudi Arabia being all played out, when the USGS has looked at the subsurface geological structures in painstaking detail, and come to a different conclusion? It would be nice if somebody had an answer to that question better than the standard peak oiler response that the USGS is an organization of idiots.

-- by JD