Jeremy Leggett’s 22 reasons why Peak Oil is real

Originally posted at

Last night, I attended “Energy & Resources for the Transition to a Sustainable Future”, a talk in Brighton organized by (on 18/04/08).

One of the speakers was Jeremy Leggett. Below is my transcript of his talk, the presentation for which will be made available as soon as possible.

Read more: Jeremy Leggett’s 22 reasons why Peak Oil is real

I believe that the peak oil theory is likely to be proven over time, simply because anything (however plentiful) in or on our planet is a finite resource. At 20 million barrels of oil per day, we’re consuming this particular resource really quickly and so far the only known natural mechanisms for the creation of oil occur over geological timescales. However, I believe that peak oil, climate change, resource/environmental management and energy security are all good enough reasons on their own to transition to a low carbon economy, so the purpose of this post isn’t to persuade but to publicise the issues at stake and help empower people to make up their own mind.

The links added are my own, as are any mistakes or omissions.

The Coming Energy Famine – why we must act ahead of peak oil by Jeremy Legget – Chief Executive of Solar Century

Jeremy said that he has recently returned from Malawi where he was visiting with SolarAid – a charity supported by SolarCentury. When he was there, he saw a wind turbine that was made by a twelve year-old boy from a bicycle frame and a wooden tower because his dream was to supply his home village with electricity. The point is that renewable energy is not rocket science, it’s something well within our means.

He predicted that the issue of Peak Oil will be a massive in the press in 2008, like climate change has been in 2007.

His 22 arguments of why peak oil is real:

  1. More whistleblowers from within/around fossil fuel industry emerging every week – IEA say three countries vital to global fossil fuel supplies: Saudi Arabia, Iraq and Iran. Peak oil believers include James Schlesinger – former US Energy Secretary and former head of CIA. Nigeria could lose 30% of production in the very near future without immediate action.
  2. Old oil fields show production can collapse. T. Boone Pickens (Texan oil billionaire) is now investing $10bn in wind to avoid the declining returns that are the nature of oil wells – i.e. production is highest right at the start and after that returns always diminish – just at different rates. North Sea Oil (last oil province ever discovered in 1980s) now collapsing at 8-9% /yr.
  3. Dearth of giants – global discovery is crashing. Just over 500 giant oil fields have been found (500 million barrels+), most before the peak of discovery (1950s-60s). Since England won the world cup, discovery has crashed. We’re using 85 million barrels per day. Average discovery size of oil fields is now only 20mb.
  4. Important to remember that lead time on frontier fields is 10 years and beyond to bring on stream. Average is six years but big ones are more than 10. Also, frontier fields present bigger challenges in exploitation – BP’s Thunderhorse field in Gulf of Mexico has been out of action for 3 years after being crippled in 2005 by Hurricane Dennis.
  5. The capacity pipeline drops fast from 2011.
  6. A third of global reserves may not even exist: phantom reserves because of founding of OPEC and introduction of quotas . Oil companies use OPEC data rather than their own, so the OPEC reserves could well be inflated, and thus ‘known’ oil reserves could be much smaller than reported by oil companies. He gave the example of Shell’s dishonesty about its proven reserves recently.
  7. The big hope of Enhanced Oil Recovery (EOR) hasn’t helped the USA, the country where most of the techniques were developed and put into place first. At the start of oil drilling, only about 30% of a well could be exploited. Now, EOR techniques can raise that by 60-70%, but oil production is declining in the US , so although EOR may slow production decline, it won’t stop it.
  8. Melting tar sands . It’s too slow and too dirty to do. Oil companies have invested $25bn in rebranding as tar industries. Still, current capacity is only 1mbd. Oil industry estimate says that this will only rise to around 2.5mbd, not enough to counter the 4-5mbd decline in conventional supplies. It takes two tons of sand to produce just one barrel of oil.
  9. Coal-to-liquids will be too slow, too dirty. Canadian government has said that CTL will be illegal in Canada unless carbon sequestration is in place. So either the law will stick or the oil companies will bully their way through it. FTL / CTL very dirty and also too little too late. Chinese target is 20mbd by 2020.
  10. Gas will not be able to close the easy-oil gap because the decline will be too fast. 2011 now best bet for start of descent from plateau. Gas lasts longer, but cannot prop up overall production.
  11. The producer-economy risk to imports. E.g. Dubai, Saudi, Russia are all producing oil through the roof (even Iran has the highest domestic growth in the world in terms of oil: 8-10% growth per year). So at the current rate of domestic use, Iran won’t be exporting by 2015. Developers aren’t doing any planning for utilities in these fast-expanding regions so there is a great risk of energy insecurity.
  12. The infrastructure legacy problem is huge. E.g. BP’s leaky oil pipelines and exploding refinery in Houston. Most of the infrastructure was put in place in the late 70s/early 80s and not much has been built since. BP’s approach was to do a risk analysis on either updating infrastructure or paying out compensation. They put a price on workers’ lives of $20 million, and when 15 workers died in the refinery explosion , they just want to pay $500 million and move on.
  13. The industry faces a runaway skills shortage . Average age in oil industry is 49 (retire at 55).
  14. The industry isn’t investing enough. Goldman Sachs say $240bn investment per year is needed for the next 10 years. The IEA said that any investment increase is “illusory” – due to inflation. Exploration budgets were actually cut between 1998 and 2006 according to Baker Institute.
  15. CO2 will increasingly focus energy options. Best chance of hitting 2oC target is to emit no more than 340 billion tonnes of carbon, but according to industry estimates there are 10 times that much carbon in coal remaining, and 3 times that in oil. Even if those figures are massively inflated (see point 6 above)…
  16. There is enough coal to trigger climate ruin . The UK govt has recently given 6 licenses for open cast coal mining. We must rally against Kingsnorth Coal Power Plant. Biggest coal reserves are in the US, then Russia, China, India and Australia.
  17. Carbon capture won’t be ready in time to reduce emissions, UK is only scheduling trials now, when what we need is widespread implementation. Beware the promise of CCS-ready power stations!
  18. Nuclear would be too late and be a vampire. It will be 10 years minimum to build new plants, and even then it will only provide around 8% of UK electricity.
  19. Renewables have been held back too long. More than 10% of investment funding has gone into renewables now for the first time – good news but is it too little too late?
  20. We might face ‘no energy for energy’. The third global energy crisis is coming. The danger is that we might end up with no energy to fabricate technologies we know will work.
  21. Culture: quasi-institutionalised denial in around the carbon business. It’s like an act of treason to admit there may be problems if you work in oil!
  22. The ‘extremes and extremists’ problem. However bad this all is, we’re going to have more than just this to deal with. E.g. Citicorp (global investment bank) Chief Executive: “as long as the music is playing, you’ve got to get up and dance. We’re still dancing”. National Front loves peak oil because they think they can resurrect themselves during the economic dislocation.

And some good news:

  • The ‘seeing is believing’ effect. Importance of ‘tipping points’ in changing behaviours.
  • The Green New Deal / Transition – like the new deal for infrastructure projects after the great depression, the Green New Deal will involve the same widespread reskilling and redeployment of resources, but it is achievable.

Some recommended further reading:

  • “Collapse” by Jared Diamond – a scary book about how human civilizations can collapse.
  • “The Tipping Point” by Malcolm Gladwell – a positive book about the power we have to change.
  • “Transition towns” by Rob Hopkins – the founder of the transition towns movement, another positive book.
  • “The Carbon War” and “Half Gone” by Jeremy Leggett.


  • Q: What do you think about the idea of big solar power plants in the desert?
  • JL: you don’t need to be in the desert to use solar power. If all the roof space in the UK had solar panels installed, we would have more electricity than we need anyway! Obviously, this isn’t something I recommend, because we need a diverse energy mix to provide maximum efficiency and energy security. But, sunny countries are picking up on the idea of solar power plants. Look at the MASDAR project in Middle East.
  • Q: What about the intermittency of renewable energy sources, how can we service the electricity baseload?
  • JL: An experiment by the German Economics Ministry was run last year looking at powering Germany’s electricity grid, including baseload from renewable sources only. They found that they could do it all without nuclear or fossils, with renewables only.
  • Q: What about the embedded carbon in different renewable energy technologies? How much energy does it take to make a wind turbine or a solar panel, and how much energy do you get back during the lifecycle?
  • JL: That’s too complex a question to answer quickly, but “Energy Return on Investment” is a term that you should watch out for, it will become ever more important.