David Demshur
Chairman President CEO
Core Laboratories

From his talk at
August 2012 (17th annual)
Denver, Colorado USA

"...Many of you know that we are peak oil guys and we believe that we are at the plateau in what the globe is going to be able to produce annually. We will be able to stay at this plateau for the next 3 or 4 years. We use about a 2 1/2% net decline curve rate every year. So we need to replace about 2.3 million barrels of production every year, and we think we can do that over the next 3 or 4 years, but inevitably we will, the globe will go into decline..."
"We will be able to stay at this plateau for the next 3 or 4 years." Core Labs CEO
What the "Plateau of Global Oil Production" essentially means is that we peaked in global oil production in 2005, and the peak, as it were, is covering a period of 10 years, or so. That's a good thing, in one sense.

For various reasons, we have been able to extend the peak and sustain oil production at the current (2005) levels for the past 7 years. Core Labs CEO David Demshur, whose company is involved with 1100 of the 4000 actively producing oil fields in the world, says we can squeak out another 3 years of this global peak plateau before global production goes into inevitable decline.

That's good news for those who are actively working to mitigate the potentially disastrous economic effects of peak oil caused by the spike in oil prices estimated as high as $400/barrel. The bad news is that there are very few individuals, communities and governments taking necessary steps to create the awareness and action needed to mitigate peak oil price spikes. Earthprojects.Info has taken up this challenge as its #1 priority. We believe the price spikes will come with the decline in global oil production (circa 2013-16).

The main component of any peak oil mitigation plan involves voluntary demand destruction like, for example, ending your daily commute to work by working from home or relocating your home to where you work, using mass public transportation instead of driving your car, and so on.
Transportation is the #1 demand driving crude oil prices, followed by industrial use of oil.

Demand for consumer use of oil in the home is relatively low, so while demand can be reduced here as well, it is important to realize that the real focus needs to be on transportation. Even if we eliminate all demand for oil from our homes we won't achieve our goal without addressing the core task of eliminating demand for oil in transportation and industry.

Eliminating all types of non-essential transportation, localizing economies, producing and buying locally grown food (the average piece of food consumed in Canada, for example, travels 10,000 KM by transport), eliminating non-essential industrial processes, products and even businesses that depend on oil is either going to happen voluntarily and systematically or chaotically by force through demand destruction.

Demand destruction is expected to cause a 50% reduction of peak price spikes and bring crude oil prices down to a new Post-Peak level of $200/per barrel after about 6 months of reaching oil's historic anticipated zenith at $400/per barrel.

The time to take action is now.
We have roughly 3 years to mitigate the potentially disastrous effects of peak oil and eliminate our dependency on oil. If we work intelligently and quickly, then we can reduce the demand for oil enough to take the pressure off the price spikes and avoid supply chain and transportation meltdown, which would threaten everyone's food security - especially those on the OECD developed nations and especially those living in America.

Eliminate your commute, move closer to work and your food supply (grocery store) and restrict your social life to your local area, as far as possible. If you own a business, go electric for power and get off of oil. Very little electricity generation in the USA is powered by oil. Truckers are already converting their engines to run on natural gas, as well, and this trend should increase. Onshore instead of offshore your manufacturing. Localize and decentralize your production and distribution.

The choices you make today will save or kill the weakest segments of the global economy literally and figuratively depending on how high oil prices spike. The global food supply chain depends on oil and even while oil and food may be plentiful, it may become unaffordable for millions for an extended period of time - long enough to kill.

Take it serious. The global food supply has been reduced to 72 days of consumption according to the USDA. A global supply chain meltdown of even 2 weeks or more, what to speak of 72 days or more, could threaten the lives of millions, if not billions, simply because of the distance between people in outer lying areas and the food stocks. Even if food is there, it could become a challenge to get the food to the people in time in a $400/barrel scenario that lasts any extended period of time.

Ideally, every person on this planet would have a 6 month to 1 year personal reserve of food grain in their home to help absorb the shock of a peak oil price spike triggered by declining global oil production. That is not going to happen any time soon on a 72 day global food supply.

We need a 365 day global food supply that is individually distributed. Everyone should be storing at least 50-100kgs of food grains (like whole wheat or rice) per adult (count two small children as 1 adult) above the age of 14. That is enough calories to survive 6 months to a year on a minimal diet of 1 meal a day.

By going vegetarian we can increase the global food supply by a factor of 300% to 220 days without increasing production or farm land because 70% of food grains in the USA are diverted for fattening animals for slaughter - an unnecessary waste of food.

Take action and eliminate the demand for oil. Millions, if not billions, of lives depend on it - maybe even your own.

Earth Projects
August 12, 2012

In evaluating the USDA's World Agricultural Supply and Demand Estimates report, the Earth Policy Institue said that world carryover grain stocks fell to 72 days of consumption, which they said is "uncomfortably close" to levels prior to 2007-08 food price spike that set off food riots across the globe.

According to the WASDE report, Earth Policy Institute said estimates for this year's global grain carryover stocks have fallen to 444 million tons.

"This amount of grain remaining in the world's silos and stockpiles when the next harvest begins is enough to meet 72 days of consumption," according ot Earth Policy Institute.

"This drop in world carryover stocks of grain to 72 days of consumption is moving us uncomfortably close to the 64 days of carryover stocks in 2007 that fueled the 2007-08 spike in world food prices," said Lester R. Brown, president of Earth Policy Institute
Learn About
The 5 Oil Eras

#1. Expanding Oil Production Era (XOPE)

Timeline: 1850-2005

XOPE came and went. Many people missed it.  I guess it is a Gen X thing. We were tuned out playing video games or something. Whatever - there is plenty of time left to revolt. Safely blame the 1% Boomers for hoodwinking us on this one, yet again, by outright lying and overstating the oil reserves held by oil companies in an attempt to befool investors and mislead the people on peak oil's ETA (estimated time of arrival). They have spent so much money lying and controlling the media and govt that peak oil has been happening for over 7 years now and people in general still don't realize it or understand it. Now that's one hell of an propaganda campaign that even Hitler and Goebbles would be proud of! Now they (the Boomers) are literally missing all that cheap and plentiful oil that caused the population to quadruple and gave rise to economic development. Wave goodbye, it's gone. Are we bothered? Not really, as long as we can maintain a wifi connection until we die, we are cool with it.

#2. Plateau of Oil Production Era (POPE)

Timeline: 2005-2015 (current Era)

In POPE, it means you have reached the top of the oil resource pyramid (like any good pope). And like any good pope, you can't remain there forever. Whatever goes up...

Why is the economy going thru cyclic recessions? What was 2008? The sub-prime housing bubble? Really? The sub-prime crisis was actually caused by oil production peaking in 2005 and stalling growth. All that sub-prime debt (banks loaning more money than they had) would not have caused a problem had oil not peaked in 2005 and growth had continued unchecked, as always. Well, it didn't, and the economy slowed and people started defaulting.

Ooops, the bankers were loaning money up to the gazoo to people and businesses who actually had no future potential for growing and hence repaying the debt. A slight oversight in failing to calculate in the oil assumption into their loan policies. The banks are still saddled with lots of this bad debt that is very likely never going to be repaid (their salaries seem to be insulated from all this somehow, oh that's the money you keep depositing thinking you will withdraw it one day...good luck on that).

Banking's big mistake can be safely blamed on the oil companies and OPEC for misleading everyone. Banks, despite having cash, are not willing to lend it out for precisely this reason. Without cheap and abundant oil to power your business and the economy, how will your business grow and pay back the loan? Good question! No one can answer it, so the money stays in the bank. You want credit? Go to  Helen Wait. She will help you.

#3. Peak Oil Price Spike Era (POPS)

Timeline: 2015-2017 (next Era)

POPE will eventually pop and that will be caused by POPS. This spikey Era will literally bust everyone's balloon of a doubt about whether or not XOPE or POPE is just voodoo doomsday economics or something real. $400 per barrel oil for no reason other than we can't produce more to save our life will surely convince them. POP!

Ounce-for-ounce, this is potentially the most lethal period (aside from two World Wars fought on oil and scores of other armed conflicts) when supply chain meltdown is a real possibility. The main supply here is food and producing and distributing food on $400/barrel  oil is going to be a daunting challenge. We just don't know how the supply chain will respond to such a shock.

Earthprojects.info is working hard now to help mitigate those shocks in this Era, coming up next. We expect oil to remain at $400/barrel for 6 months. The strategy is to store 6 months of grains to buffer the impact of food price spikes for the poorest segments of the economy. Ideally, everyone would have their own 50-100 kg stash of carefully stored grain, but that is not likely to happen due to extreme climate changes and the fact that we are at a historical low level in the global food supply of only 72 days as we enter POPS. Not a good situation to be in. 

#4. Declining Oil Production Era (DOPE)

Timeline: 2017-2030

DOPE will be a real downer of an Era. Every year after POPS we will face a 3-5% decline in global oil production and a consequent downward spiraling economy that shrinks at the same level or more, depending on how chatoic the economy contracts. It is called "demand destruction". Hopefully it is intelligently done and our excess fat is cut out, sparing people's lives. Otherwise, if chaos rules, then it could be a horrific loss of human life.

Global downsizing of all things human and oil based is the name of this bitter pill. Unfortunately this may also include food production as oil plays a critical sole in that. More DOPE and less food is not going to be a very healthy combination. Some project a population decline of 75% or more. Uh, let's take a break from our life and seriously solve this food problem, whatever else it may be that we are doing and thinking is important.

#5. Post-Petroleum Production Era (P3)

Timeline: 2030-Oblivion

P3 will be a lot like trading in your screaming quad core i7 CPU for an old P3 system. It will "work", but you know, it's just slow. But then that is relative. Those who were conditioned to life in the fast lane living like a POPE will feel the pinch, but the next generation will accept it as the norm like our great-great grandparents did - the old fashioned way.

Truth be told, you might be walking to work everyday to the barn to milk your cows, but at least you will be eating well and it will all be organic! Health, happiness and a closer connection to God is in store. They don't call the rural Midwest "God's Country" for nothing. You are about to find out why, very soon. Exciting times ahead! Moooo!

I hope we can sustain the Internet somehow. Maybe I am dreaming. Whatever the case, the Internet will be the last to go. If we can print a tablet PC on a piece of paper, then I am sure we will be online for another 200 yrs. But when you have crops and cows, scarecrows and udders to tend to (a real life), who needs Facebook and Twitter?

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