Living in La-La Land

The following paraphrases a letter from a UK Oil Industry insider to a widely read 'Peak Oil' commentator in the US - Jim Kunstler. I have paraphrased it for UK readers and interspersed it with a few comments of my own.

As someone who works in the UK oil industry, I thought you might be interested in a view of how prepared the UK is for future oil shortages.

[The short answer: It isn't. It's living in La-La Land - see below]

I have just finished a stint as an engineer on the Forties pipeline terminal. Prior to that I had spent some 30 years working in various parts of the oil and nuclear sectors as a chemical/process engineer.

The career outlined above has provided me with an acute insight into how the UK oil industry is preparing for the future. Essentially, it is abandoning the UK. BP has either sold-off or closed all its UK refineries (the last one to go was Grangemouth) and now only retains its Forties & Sullom Voe interests. Shell is planning to swap over to Middle-east crude around 2011 at its single remaining UK refinery and is busy selling off most of its European refineries. Any questions as to whether Middle-east crude will be available to the UK in 2011 are studiously ignored.

[Though such questions provide insight into just why Iraq, with the worlds largest undeveloped reserves of what remains of the worlds oil endowment together with the ME generally, warrants such vast military expenditure and war-fighting effort by both the UK and US. There is thus an assumption by the oil companies that the West's clear determination to effectively control ME oil distribution will be successful - That's one BIG BIG assumption given burgeoning demand from China and the bitter resentments being generated throughout the Arab/Muslim world]

The general attitude is one of, 'Since we will need the oil, it will be available'. All of the above points to the oil companies foreseeing a pretty bleak future for their UK and European refining operations.

[But we carry on with a road and airports building program that assumes both road and air traffic will expand by upwards of 25% over the next 15-20years. The oil industry knows that refined petroleum products to fuel this expansion will simply not be available. They brief politicians - but silence is the order of the day. Anything that casts doubt on the latter-day religion of constant Economic Growth and 'Progress' (to what I wonder?) is political heresy, to be dealt with in similar fashion to other taboo subjects like immigration and race issues for example - ignore, marginalize or otherwise kill the messenger]

Within BP, the message from senior management is that their Forties terminal will still be in operation 20 years from now. What they fail to mention, even to their own employees is just how little oil and gas will be coming out of the North sea by then. This is quite weird given that North Sea production dropped another 10% last year, despite Buzzard crude coming ashore.

[As did two other super-giant fields - Mexico's Cantarell and the US's Prudhoe Bay with the daddy of them all, Saudi Arabia's Ghawar teetering on the brink of decline]

While much of the thinking inside the UK oil industry is delusional, outside of it we are pretty much living in La-La land. Both the government and the media are obsessed with global warming. Barely an evening passes without a news item relating to icebergs melting, heat stroke in Polar bears or the sad absence of lichen for reindeer etc. Inside the oil industry it is well known that the UK government is regularly briefed by the oil companies. Evidently the government have made the decision to use global warming as a way of encouraging thrift in oil usage - but with absolutely no effect.

[Meanwhile the assumptions of massive increases in both air and road travel remain a given of political discourse]

What is never mentioned in the media is the crashing of North Sea oil production. A recent documentary about oil exploration in the Arctic managed to completely ignore why such desperate measures might be required.

In terms of politics, the Labour party evidently regard discussions about oil depletion as near treason, whilst the Tory party is still proud of the way they defeated the miners. Neither party is exactly in the right frame of mind to restart the nuclear industry or open up new coal mines.

Perhaps the worst aspect of the UK shitstorm in preparation, is the way the Labour party is allowing and even encouraging supermarkets to destroy farming in the UK. (Farmers generally hate the Labour party as being a bunch of clueless idiots - quite perceptive really). Agricultural production has dropped disastrously in recent years, with thousands of farmers being forced into bankruptcy by the monopolies enjoyed by the likes of Tesco (big and nasty) and Sainsbury (smaller and nasty). At least the USA still has a huge amount of good land available. In the UK, we are packed in like sardines in terms of population density, which spells disaster when the oil gets short.

[Ten calories of hydrocarbon energy is currently used by way of fertilisers, primary production, processing and transport, for every calorie of food that a UK citizen eats. Our food supply is organized on a 'just-in-time' basis with maybe 3 day's consumption on retail shelves at any one time and over 50% of it shipped in by sea or air. Lessons learned the hard way through WWII have not only been been forgotten but are now routinely derided as irrelevant - our best arable land is better put to urban theme park and house building uses init eh?. But, with the confluence of 'Peak-Oil', exponential worldwide population growth, and climate change, an overpopulated island nation that cannot feed itself is heading for very serious trouble.]