“Peak oil” theorists will be vindicated by a Feb. 20 report on al-Jazeera that Saudi Arabia, the world’s top oil producer, has past its peak of production and may have in fact damaged its own extractable reserves through over-production. Writes al-Jazeera:
As oil stubbornly refuses to fall below $45 a barrel, a major market mover has cast a worrying future prediction.
Energy investment banker Matthew Simmons, of Simmons & Co International, has been outspoken in his warnings about peak oil before. His new statement is his strongest yet, “we may have already passed peak oil.” Speaking exclusively to Aljazeera, Simmons came out with a statement that, if proven true over time, could herald by far the biggest energy crisis mankind has known.”If Saudi Arabia have damaged their fields, accidentally or not, by overproducing them, then we may have already passed peak oil. Iran has certainly peaked, there is no way on Earth they can ever get back to their production of six million barrels per day (mbpd).” The technical term for damaging an oilfield by overproduction is rate sensitivity. In other words, if the oil is pulled out of the ground too fast, it damages the fragile geological structure of the field. This can make as much as 80% of the oil within the field unextractable. Of course, at the moment, virtually every producer is at full tilt. The most important among them is Saudi Arabia; their Gharwar field is the world’s biggest…
Currently, at near maximum production, Saudi Arabia is producing about 9mbpd, though recently they claimed they could potentially produce 12mbpd or even as much as 20mbpd. A claim Simmons called “pie in the sky”… “The faster you pull a reservoir, the faster you pull out all of the easy-to-produce oil,” explains Simmons. “What happens is that you lose massive amounts of what the oil industry calls oil-left-behind still inside the field. These issues, as you can see, have been known about for years.”
…The idea that Saudi Arabia could force its production up to 12mbpd or higher is met with scorn by Simmons.
“This is dangerous stuff,” warns Simmons. “If we say they have not peaked and then they choose to further increase production, they will only hasten their field decline, and waste huge amounts of valuable oil into the bargain.”