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Energy Wars

China’s nuclear energy breakthrough

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by Hua Bin via https://huabinoliver.substack.com/p/what-is-really-going-to-change-the

China has operationalized the world’s first thorium nuclear reactor

As the world is spellbound by the zigzagging tariff war drama launched by reality TV star Donnie Trump and people marvel at the sheer destructiveness of a stupid mad man, a truly momentous event just happened in China.

In early April, Chinese scientists achieved a milestone in clean energy technology by successfully adding fresh fuel to an operational thorium molten salt reactor, the first of its kind in the world. The breakthrough signals the arrival of commercially viable thorium nuclear reactor in China’s future energy mix.

Thorium is much safer and more abundant alternative to uranium for nuclear power as it is widely available, cheaper to extract, has higher energy density, and produces far less long-lasting nuclear waste.

It is far safer than uranium as it is not fissile on its own so cannot be weaponized. Nuclear industry experts see thorium as the holy grail for future energy revolution next to nuclear fusion, which I’ll touch on briefly at the end.

Thorium is found in abundant quantity in earth’s crust all over the world. One single mine in China’s Inner Mongolia, the Bayan Obo mine, has enough thorium deposits to theoretically meet China’s energy needs for the next 20,000 years, while producing minimal radioactive waste.

The most promising technological direction is to use thorium in molten salt reactors. While multiple nations are developing the technology, China is the first to build an experimental thorium molten salt reactor.

The latest breakthrough to add fresh fuel to an operational reactor indicates such technology is ready for sustained commercial deployment.

It marks the first long-term, stable operation of the technology, putting China at the forefront of a global race to harness thorium for nuclear power.

The experimental reactor, located in the Gobi Desert in China’s west, uses molten salt as the fuel carrier and coolant, and thorium as the fuel source. The reactor is designed to sustainably generate 2 megawatts of thermal power.

The development was announced by the project’s chief scientist, Xu Hongjie, at the Chinese Academy of Sciences on April 8. Xu said China “now leads the global frontier for thorium nuclear technology”.

China’s thorium molten salt reactor project began with theoretical research in the 1970s, and in 2009 the CAS leadership tasked Xu with making the next-generation nuclear energy technology a reality.

The project team expanded from dozens of members to more than 400 researchers within two years.

“We learned by doing, and did by learning,” Xu said. The challenges were immense – designing new materials, troubleshooting for extreme temperatures, and dealing with engineering components that had never been built before.

After construction of the experimental reactor started in 2018, most of the scientists involved in the project gave up their holidays – they worked day and night, and some stayed on site for more than 300 days in a year. The Gobi Desert is thousands of kilometres away from the major coastal cities.

By October 2023 it was built and achieved criticality – a sustained nuclear chain reaction. And by June 2024 it had reached full-power operation.

Earlier this year the process of thorium fuel reloading was completed while the reactor was running – making it the only operational thorium reactor in the world.

“We chose the hardest path, but the right one,” Xu was quoted as saying, referring to the drive for a real-world application rather than a purely academic pursuit.

A much bigger thorium molten salt reactor is already being built in China and is slated to achieve criticality by 2030. That research reactor is designed to produce 10 megawatts of electricity, enough to power 10,000 homes for a year.

China’s state-owned shipbuilding industry has also unveiled a design for thorium powered container ship that could potentially achieve emission-free maritime transport.

Meanwhile, US efforts to develop a molten salt reactor remain on paper, despite bipartisan congressional support and Department of Energy initiatives.

Xu said, “in the nuclear game, there are no quick wins. You need to have strategic stamina, focusing on doing just one thing for 20, 30 years.”

In addition to thorium reactors, China is on the leading edge of developing nuclear fusion technology (as opposed to current fission technology) that could lead to carbon-free, almost limitless, and clean energy. Fusion is the way sun powers itself and generates 4 times the amount of energy as fission.

At the heart of this fusion revolution lies the tokamak, a donut-shaped device designed to contain superheated plasma using powerful magnetic fields. By mimicking the sun’s conditions—where hydrogen atoms fuse into helium—tokamaks enable the release of tremendous amounts of energy.

China is at the leading edge in global nuclear fusion development. Most recently, China achieved several key milestones in fusion research, including –

– Experimental Advanced Superconducting Tokamak (EAST), dubbed as “artificial sun” in China, has set new record in January 2025. The project is based Hefei and run by the China Academy of Sciences (CAS), the world’s leading scientific research institute.

EAST maintained a high-confinement plasma for 1,066 seconds, surpassing previous world record of 403 seconds – a crucial step towards sustained fusion reactions necessary for practical energy generation.

– HL-2M Tokamak, located in Chengdu, is China’s largest and most advanced tokamak. It has achieved first plasma discharge and high plasma parameters, capable of producing plasma temperatures exceeding 200 million degrees Celsius and plasma currents over 2.5 million amperes, essential for efficient fusion reactions.

– HH70 Tokamak, developed by Shanghai-based private company Energy Singularity, stands out for integrating high temperature superconducting magnets made from REBCO (rare earth barium copper oxide). This cutting edge technology dramatically reduces the size and cost of conventional tokamaks, paving the way for more accessible and commercial fusion energy.

Energy Singularity plans to construct a next-gen tokamak by 2027 and a full scale technological demonstrator for fusion nuclear reaction by 2030.

Although commercial viability remains the final frontier, breakthroughs like EAST and HH70 showcase the significant strides towards turning nuclear fusion into a practical energy solution.

All the noises around tariffs and trade wars aside, technology is ultimately the path to human development and prosperity. Let’s keep our eyes on the ball.

(Republished from Substack by permission of author or representative)

Energy Wars

The Myth of Peak Oil – Oil is as Natural as Water

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This is a short 8-minute video about the alleged politics behind how the term “fossil fuel” came to be used.

“Is Greta Thunberg right on climate change, Mr. President?”

But the best work on this topic of “abiotic oil”, in my opinion, is from Dr. John Kenney, the founder and Chairman of JP Kenny Petroleum Ltd, and also a member of the Russian Academy of Sciences – Joint Institute of The Physics of the Earth.

He has probably researched this topic more than anyone else in the U.S., deriving his research from the Russian scientific literature.

Here is an interview he did with NPR (National Public Radio) back in 1994. He had just published a paper where he claimed to have created petroleum in a laboratory.

0:30 / 18:21

This is his Introduction from his website.

Introduction

An introduction to the modern petroleum science, and to the Russian-Ukrainian theory of deep, abiotic petroleum origins.

J. F. Kenney

Russian Academy of Sciences – Joint Institute of The Physics of the Earth.

Gas Resources Corporation, 11811 North Freeway, Houston, TX 77060, U.S.A.

The following articles take up, from different perspectives, the modern Russian-Ukrainian theory of deep, abiotic petroleum origins. Because that subject is one of which most persons outside the former U.S.S.R. are not familiar, a short synopsis of it and of its provenance and history, are given now.

1. The essence of the modern Russian-Ukrainian theory of deep, abiotic petroleum origins.

The modern Russian-Ukrainian theory of deep, abiotic petroleum origins is an extensive body of scientific knowledge which covers the subjects of the chemical genesis of the hydrocarbon molecules which comprise natural petroleum, the physical processes which occasion their terrestrial concentration, the dynamical processes of the movement of that material into geological reservoirs of petroleum, and the location and economic production of petroleum.

The modern Russian-Ukrainian theory of deep, abiotic petroleum origins recognizes that petroleum is a primordial material of deep origin which has been erupted into the crust of the Earth. In short, and bluntly, petroleum is not a “fossil fuel” and has no intrinsic connection with dead dinosaurs (or any other biological detritus) “in the sediments” (or anywhere else).

The modern Russian-Ukrainian theory of petroleum is based upon rigorous scientific reasoning, consistent with the laws of physics and chemistry, as well as upon extensive geological observation, and rests squarely in the mainstream of modern physics and chemistry, from which it draws its provenance.

Much of the modern Russian theory of deep, abiotic petroleum genesis developed from the sciences of chemistry and thermodynamics, and accordingly the modern theory has steadfastly held as a central tenet that the generation of hydrocarbons must conform to the general laws of chemical thermodynamics, – as must likewise all matter.

In such respect, modern Russian-Ukrainian petroleum science contrasts strongly to what are too often passed off as “theories” in the field of geology in Britain and the U.S.A.

As will be shown explicitly in a following articles, petroleum has no intrinsic association with biological material. The only hydrocarbon molecules which are exceptions to this point are methane, the hydrocarbon alkane specie of lowest chemical potential of all hydrocarbons, and to a lesser extent, ethene, the alkene of the lowest chemical potential of its homologous molecular series.

Only methane is thermodynamically stable in the pressure and temperature regime of the near-surface crust of the Earth and accordingly can be generated there spontaneously, as is indeed observed for phenomena such as swamp gas or sewer gas.

However, methane is practically the sole hydrocarbon molecule possessing such thermodynamic characteristic in that thermodynamic regime; almost all other reduced hydrocarbon molecules excepting only the lightest ones, are high pressure polymorphs of the hydrogen-carbon system.

Spontaneous genesis of the heavier hydrocarbons which comprise natural petroleum occurs only in multi-kilobar regimes of high pressures, as is shown in a following article.

2. The historical beginnings of petroleum science, – with a touch of irony.

The history of petroleum science might be considered to have begun in the year 1757 when the great Russian scholar Mikhailo V. Lomonosov enunciated the hypothesis that oil might originate from biological detritus.

Applying the rudimentary powers of observation and the necessarily limited analytical skills available in his time, Lomonosov hypothesized that “… ‘rock oil’ [crude oil, or petroleum] originated as the minute bodies of dead marine and other animals which were buried in the sediments and which, over the passage of a great duration of time under the influence of heat and pressure, transformed into ‘rock oil’.”

Such was the descriptive science practiced in the eighteenth century by Lomonosov and Linnaeus.

The scientists who first rejected Lomonsov’s hypothesis, at the beginning of the nineteenth century, were the famous German naturalist and geologist Alexander von Humboldt and the French chemist and thermodynamicist Louis Joseph Gay-Lussac who together enunciated the proposition that oil is a primordial material erupted from great depth, and is unconnected with any biological matter near the surface of the Earth.

Thus both ideas were delivered with powerful pedigrees: the wrong biological notion having been put forward by the greatest Russian scientist of his time; and the abiotic proposition approximately a half century later by, respectively, two of the greatest German and French scientists.

Historically, the first scientific repudiation Lomonosov’s hypothesis of a biological origin of petroleum came from chemists and thermodynamicists. With the nascent development of chemistry during the nineteenth century, and following particularly the enunciation of the second law of thermodynamics by Clausius in 1850, Lomonosov’s biological hypothesis came inevitably under attack.

The great French chemist Marcellin Berthelot particularly scorned the hypothesis of a biological origin for petroleum. Berthelot first carried out experiments involving, among others, a series of what are now referred to as Kolbe reactions and demonstrated the generation of petroleum by dissolving steel in strong acid.

He produced the suite of n-alkanes and made it plain that such were generated in total absence of any “biological” molecule or process. Berthelot’s investigations were later extended and refined by other scientists, including Biasson and Sokolov, all of whom observed similar phenomena and likewise concluded that petroleum was unconnected to biological matter.

During the last quarter of the nineteenth century, the great Russian chemist Dmitri Mendeleev also examined and rejected Lomonosov’s hypothesis of a biological origin for petroleum.

In contrast to Berthelot who had made no suggestion as to where or how petroleum might have come, Mendeleev stated clearly that petroleum is a primordial material which has erupted from great depth.

With extraordinary perception, Mendeleev hypothesized the existence of geological structures which he called “deep faults,” and correctly identified such as the locus of weakness in the crust of the Earth via which petroleum would travel from the depths.

After he made that hypothesis, Mendeleev was abusively criticized by the geologists of his time, for the notion of deep faults was then unknown.

Today, of course, an understanding of plate tectonics would be unimaginable without recognition of deep faults.

3. The enunciation and development of modern petroleum science.

The impetus for development of modern petroleum science came shortly after the end of World War II, and was impelled by recognition by the government of the (then) U.S.S.R. of the crucial necessity of petroleum in modern warfare.

In 1947, the U.S.S.R. had (as its petroleum “experts” then estimated) very limited petroleum reserves, of which the largest were the oil fields in the region of the Abseron peninsula, near the Caspian city Baku in the present country of Azerbaijan.

At that time, the oil fields near Baku were considered to be “depleting” and “nearing exhaustion.”

During World War II, the Soviets had occupied the two northern provinces of Iran; in 1946, the British government had forced them out.

By 1947, the Soviets realized that the American, British, and French were not going to allow them to operate in the middle east, nor in the petroleum producing areas of Africa, nor Indonesia, nor Burma, nor Malaysia, nor anywhere in the far east, nor in Latin America.

The government of the Soviet Union recognized then that new petroleum reserves would have to be discovered and developed within the U.S.S.R.

The government of the Soviet Union initiated a “Manhattan Project” type program, which was given the highest priority to study every aspect of petroleum, to determine its origins and how petroleum reserves are generated, and to ascertain what might be the most effective strategies for petroleum exploration.

At that time, Russia benefited from the excellent educational system which had been introduced after the 1917 revolution. The Russian petroleum community had then almost two generations of highly educated, scientifically competent men and women, ready to take up the problem of petroleum origins.

Modern Russian petroleum science followed within five years.

In 1951, the modern Russian-Ukrainian theory of deep, abiotic petroleum origins was first enunciated by Nikolai A. Kudryavtsev at the All-Union petroleum geology congress.

Kudryavtsev analyzed the hypothesis of a biological origin of petroleum, and pointed out the failures of the claims then commonly put forth to support that hypothesis.

Kudryavtsev was soon joined by numerous other Russian and Ukrainian geologists, among the first of whom were P. N. Kropotkin, K. A. Shakhvarstova, G. N. Dolenko, V. F. Linetskii, V. B. Porfir’yev, and K. A. Anikiev.

During the first decade of its existence, the modern theory of petroleum origins was the subject of great contention and controversy. Between the years 1951 and 1965, with the leadership of Kudryavtsev and Porfir’yev, increasing numbers of geologists published articles demonstrating the failures and inconsistencies inherent in the old “biogenic origin” hypothesis.

With the passing of the first decade of the modern theory, the failure of the previous, eighteenth century hypothesis of an origin of petroleum from biological detritus in the near-surface sediments had been thoroughly demonstrated, the hypothesis of Lomonosov discredited, and the modern theory firmly established.

An important point to be recognized is that the modern Russian-Ukrainian theory of abiotic petroleum origins was, initially, a geologists’ theory.

Kudryavtsev, Kropotkin, Dolenko, Porfir’yev and the developers of the modern theory of petroleum were all geologists. Their arguments were necessarily those of geologists, developed from many observations, and much data, organized into a pattern, and argued by persuasion.

By contrast, the practice of mainstream, predictive modern science, particularly physics and chemistry, involves a minimum of observation or data, and applies only a minimum of physical law, inevitably expressed with formal mathematics, and argues by compulsion.

Such predictive proof of the geologists assertions for the modern Russian-Ukrainian theory of deep, abiotic petroleum origins had to wait almost a half century, for such required the development not only of modern quantum statistical mechanics but also that of the techniques of many-body theory and the application of statistical geometry to the analysis of dense fluids, designated scaled particle theory.

Read the full Introduction and other articles at Gasresources.net.

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Energy Wars

Will Trump Blow Up Another Russian Pipeline?

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by Tarik Cyril Amar via RT

Should TurkStream go the way of Nord Stream, it will prove that it doesn’t matter who is in the White House

On January 11, nine Ukrainian drones attacked the “Russkaya” compressor station near the town of Anapa in Russia’s Krasnodar Region. The station, situated on the north-eastern coast of the Black Sea, is a key installation in the TurkStream gas pipeline that crosses the Black Sea’s seabed to emerge on land again north of Istanbul.

To be precise, TurkStream consists of two parallel pipelines, just like the Nord Stream 1 and 2, which used to link Russia and the EU. Most of these two trans-Baltic pipelines were destroyed in a massive act of eco-terrorism; the perpetrators are certain to have included Ukraine and the US, in one way or another.

The attack on the compressor station did not achieve its aims. Russian air defenses shot down the drones, and despite some minor damage, the station remained intact. However there were important consequences, and this story is far from over.

Three days after the Ukrainian strike, Russia’s Foreign Minister Sergey Lavrov accused Washington of being behind Kiev’s assault. In particular, Lavrov charged that the US is seeking to demolish TurkStream, just as it made sure Nord Stream was taken out of commission. If Lavrov is right, the unsuccessful January 11 drone attack could turn out to have only been the beginning: Further attacks may follow, perhaps including an underwater bombing of the pipelines, as was carried out against Nord Stream in September 2022.

Context is essential here: At the beginning of this year, pipelines carrying gas from Russia via Ukraine to the EU were switched off after Kiev refused to prolong a transit agreement.

That has left TurkStream the only remaining pipeline sending gas from Russia to, ultimately, the EU, in this case mostly Hungary. Importantly, Lavrov believes that the US is aiming to have its Ukrainian clients sabotage this last remaining link, not only to hit Russia but also in order to fulfil the broader strategy of disrupting the EU’s economies.

It is true that we won’t know for certain whether there is a dedicated US project to sabotage TurkStream and, if so, how far it will go – unless, of course, we wake up one morning to learn that “mysterious” explosions have occurred at the bottom of the Black Sea. In any case, Lavrov’s reading of the situation and warnings – not made for the first time – are plausible and should be taken seriously as a matter of due diligence, especially by Washington’s so-called European partners, that is, vassals.

This is so for several reasons: First, what happened to Nord Stream showed that the US and Ukraine accept no limits, even and perhaps especially among “allies.”Even more important is what happened after their Nord Stream attack, namely, in essence, nothing, at least to them. Instead, there was a prolonged period of falsely (and absurdly) blaming Russia, while the Europeans frantically helped cover up their “friends’” assault as best they could.

When that strategy of denial and disinformation became untenable, some Ukrainians were officially blamed but, as it happens, never apprehended – with the convenient side effect of letting Washington off the hook entirely. It’s a story that makes no sense, but then, making sense is not a thing Western elites and mainstream media consider obligatory. In any case, their failure to defend national interests and retaliate against a brutal attack on those interests can only have emboldened the perpetrators.

Then there is Donald Trump, of course. The returning US president’s explicit policy of making the US “energy dominant” has various domestic aspects, from privileging the fossil fuel industry, which has contributed greatly to his campaign funds, to degrading environmental standards. But it also has foreign policy implications. One is the fact that Trump is continuing and escalating his predecessor Joe Biden’s policy of making the European vassals buy expensive American liquefied natural gas (LNG).

Trump wants them to take even more LNG, using the threat of punitive tariffs as a very American-style sales argument. In essence, this is just the latest phase of that other economic war that Washington has waged: While the one against Russia has backfired quite spectacularly, leaving Moscow stronger and more resilient than before, this one, against Washington’s own NATO-EU vassals has been successful.

Comparatively inexpensive Russian energy has been replaced with expensive American (and other) substitutes – as of 2021, 47 percent of the EU’s gas supplies still came from Russia, for instance. The Europeans have submissively crippled themselves economically and greatly reinforced their dependency on the US. From Washington’s brutally selfish perspective, what’s not to love? At least as long as the Europeans do not rebel. And it seems they never will, astounding as that is.

Finally, there is a broader but no less pertinent context. Lavrov made his remarks about the danger to the TurkStream pipelines at a much longer press conference, which was dedicated to a review of Russian diplomacy in 2024. Against that backdrop, he also restated his views on Washington’s general approach to other countries and, really, the world as such. His crucial point in this regard was that America is not interested, in principal, in equality between sovereign states, balance between their interests, or fair competition between their economies.

Instead, we can add, it keeps pursuing what Americans themselves call “primacy” and what the rest of the world experiences as a relentless policy of domination, intimidation, interference, and continual, usually extremely destructive, warfare. The US, Lavrov summed it up, does not accept any “competitor in any sphere.” We might add again, under any conditions, except when it is compelled to do so.

Washington’s ruthlessness – and lawlessness – in controlling energy resources and infrastructure and, if necessary, in destroying them, too, is merely one aspect of this strategy. A strategy that seems so deeply ingrained in the collective mind of America’s elite that they cannot even imagine a less confrontational approach to their neighbors on planet Earth anymore. If Trump intends to “make America even greater,” Lavrov warned, the world will have to pay close attention to the methods he will employ to do so.

One test will be what will happen – or not – to TurkStream under Trump. If it should go the way Nord Stream went under Biden, that would be more – if unsurprising – evidence that, ultimately, it makes little difference to the rest of us who is in the White House. Because in America you can have any foreign policy – as long as it’s bossy.

Read more here

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Energy Wars

Could the Loss of Syria by the Russians Cause the Loss of Russia?

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by Claudiu Secara

Let’s face it. The loss of Syria by Russia is a monumental defeat with far ranging consequences. It’s not about the ISIS, as Mr. Putin claims, and it’s not about losing Russia’s only air and sea bases on the Mediterranean Coast. Mr. Doctorow goes on talkshows like Judge Napolitano’s, making the rounds to explain how Russia has actually already won its objectives in Syria. That’s a very low parroting of the same explanation given by Mr. Putin.

We are to believe that Russia defeated the ISIS in Syria and now it can retire. Far from the truth. The ISIS dressed in a business suit is now in power in Syria.

But the biggest loss for Mr. Putin is the loss of the pipeline war: From the Nord Stream, lost in a blowup attack by the US, to, now, the loss of the Ukraine pipeline starting January 1, to be followed by the advent of the Turkish pipeline.

That’s what the debacle in Syria is all about.

The Turks, so far dependent on Russian gas and oil, can now quickly get the pipeline built from the Gulf States right at their doorsteps through Syria. Erdogan has played the Russians.

The consequences for Russia are dire. Once the Turks are no longer dependent on Russian energy, the Turks can reassert themselves as the gatekeepers of the straits linking the Black Sea and the Mediterranean Sea, basically the only exit for Russia to the world at large.

If we consider that the Syrian pipeline will come to fruition, it will not be limited to the Gulf countries’ energy resources; it can also carry oil and gas from the Central Asian countries. The oil from Azerbaijan, from Kazahstan, even from Turkmenistan can now flow – outside of Russia’s control.

The Europeans are back in business – and they don’t even need to die in the war in Ukraine in order to contain Russia and strangulate it economically.

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Energy Wars

Peak “Cheap” Oil

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via – Bloomberg

Former Toyota CEO James Lentz noted in 2009 that oil production would peak “sometime in the neighborhood of 2017 or 2020.” In hindsight, this observation was extremely prescient: world liquids production is -1.1 mmb/day less than the November 2018 peak level, and crude plus condensate production is -3.9 mmb/day less than in November 2018 (Art Berman). The question is whether or not the November 2018 peak will be surpassed (if it even can be).

The “peak ‘cheap’ energy” question opens up a Pandora’s box of what motivated COVID-19, Net Zero objectives since then, and European deindustrialization which also peaked in 2017 — all of which are examples of demand destruction that restricts prices from moving prohibitively higher. Barring the banking crisis in late 2019, there was already a concurrent and arguably more significant crisis of energy.

This post describes peak oil theory in terms of peak EROI, suggests that a collapse in cheap energy prices would threaten global debt and FX markets, and speculates that it is therefore a plausible motive for COVID-19 and the state policy actions taken on since.

Energy-backed World

Declining oil production in the face of constant (or rising) demand would not only risk resource wars and/or famine, but the loss of cheap energy which could spillover into global debt markets. Debt, private (like a business or personal loan) and sovereign (issued by a nation), exists primarily with the expectation of future growth. The last century of growth has been one of industrialization, built on cheap energy.

To illustrate this crisis, we can imagine an example:

As previously noted, conventional oil reached its resource-limited global production plateau in 2005, at least for oil prices up to well above $100/bbl. Oil prices “well above $100/bbl” would necessarily be expensive for import-dependent nations and prohibitively so in emerging markets. Since the global oil trade is priced in USD, the demand for USD would increase and, to the detriment of the rest of the world, strengthen the dollar FX rate.

A global balance of payments crisis could unfold where a nation’s increase in dollar demand to pay for higher-priced oil drains their dollar reserves. Dollar reserves are typically held as US Treasuries, and access to dollars can be obtained readily in Treasury repo or by Treasury sales. If an nation’s dollar reserves are insufficient to cover the trade deficit, it would face difficulties in meeting its external payment obligations — leading to a vicious cycle of currency depreciation, capital flight, and economic contraction.

Thus, such a scenario playing out over an extended period could ultimately create a marginal incentive to de-dollarize, purchasing energy in foreign currency or in repriced gold. De-dollarization would necessarily collapse US debt markets, as foreign demand for US Treasuries (who own 30% of US debt) declines.

*This scenario is a dramatic simplification that describes only one example, and there are nuances/alternate scenarios that cannot be fit onto this post.

Oil Headed for $150 Without US Support for More Drilling, Shale CEO Says

Oil is headed as high as $150 a barrel unless the US government does more to encourage exploration, according to Continental Resources, the shale driller controlled by billionaire Harold Hamm.

Crude output in the Permian Basin will one day peak as it already has in rival shale regions such as the Bakken region of North Dakota and the Eagle Ford in Texas, Continental Chief Executive Officer Doug Lawler said during an interview with Bloomberg TV. Without new production, “you’re going to see $120 to $150” oil, he said.

“That’s going to send a shock through the system,” he said. Without policies encouraging new drilling, “you’re going to see more pressure on price.”

*

via Gorozen

Permian productivity has been a hot topic since well performance dropped last year. That trend looks to be continuing into 2023.

We don’t yet have a ton of data on well history (after you factor in reporting delays), but so far, it looks like performance has continued to fall. Looking at peak rates, Permian wells have fallen from an average peak month production of 986 bbl/d in 2021 to 942 bbl/d in 2022 and now 861 bbl/d in 2023.

Of course, the 2023 numbers are for a smaller sample size than 2021 and 2022, but this is nevertheless worth watching.

*

via – Ted Cross

    Hubbert’s Peak is Finally Here

    06/15/2023

    The article below is an excerpt from our Q1 2023 commentary.

    Conventional oil production has now unequivocally rolled over. Unconventional production, the only source of growth in global oil supply over the last 12 years, has also significantly slowed. The only growing non-OPEC basin is the Permian in West Texas. Never before has oil supply growth been so geographically concentrated. Six counties in West Texas are now 100% responsible for all global production growth.

    Conventional non-OPEC oil production peaked in 2007 at 46.2 mm b/d and now stands at 44.2 mm b/d – 4% below its peak. Including OPEC, conventional global output peaked in 2016 at 84.5 mm b/d and now stands at 81.3 m b/d – 5% below its peak. Even if OPEC has its alleged 4 mm b/d of unused production capacity (something we do not believe), conventional production would barely regain its 2016 peak.

    In 2009, we tried to predict non-OPEC production growth based on every major project expected to come online over the next ten years. Based on our modeling, non-OPEC supply would begin to contract by about 200-400,000 b/d annually. New fields would not grow enough to offset underlying field depletion that we estimated at 4% in the non-OPEC world. In our 2Q18 letter, we tackled the subject again. In two essays (“Conventional Oil: The Problems No One is Talking About” and “Conventional non-OPEC Oil in Depth: Declines are Set to Rapidly Accelerate”), we discussed how conventional non-OPEC production was in terminal decline. Our research looks to have been correct.

    However, the world has enjoyed a great luxury—it could ignore the problems firmly embedded in conventional oil production. Surging production from non-conventional oil sources more than offset these declines.

    Non-OPEC oil production between 2006 and 2015 grew by 8.6 mm b/d. Conventional oil supply contracted by 1.4 mm b/d. Unconventional oil supply more than offset these declines, surging by 10 mm b/d and broken down as follows: US shales grew by 6.8 mm b/d (65% of all growth), bio-fuels grew by 1.9 mm b/d (19% of the growth), and Canadian oil sands increased 1.4 mm b/d (14% of the growth). Please note that out of this 10 mm b/d growth figure, the Permian represents only 1.4 mm b/d or 14%.

    Between 2016 and 2023, unconventional production surged by another 7.4 mm b/d, representing all non-OPEC supply growth. US shales accounted for 85% of the increase. However, whereas all the major shale basins grew from 2006 to 2015, only the Permian grew afterward. The Bakken and Eagle Ford peaked at 1.5 mm b/d in 2015, and this year are each expected only to be between 900,000 and 1 mm b/d. Significant unconventional growth also came from natural gas liquids production in the liquids-rich Marcellus and Utica, which we estimate each added 1 m b/d. This source of production growth is now set to fade, while the plateauing of the Marcellus will turn into a decline.

    Between 2006 and 2015, the Permian represented only 14% of unconventional supply growth. Between 2015 and 2023, the Permian represented almost 75% of this growth.

    2023.06 G&R Blog #356 - Hubberts Peak is Here

    Conventional production started declining in the non-OPEC world over a decade ago. Conventional oil production has most likely turned negative in the OPEC world as well. Over the last thirty years, global oil supply growth has come from multiple geographic areas, including the North Sea, Mexico, Brazil, West Africa, and the Former Soviet Union. Over the last decade, however, these areas have had slight growth, and specific basins, such as the North Sea, have experienced considerable declines.

    Consensus opinion believed global oil demand would peak in 2019 and gradually decline through this decade. Just the opposite has occurred: demand has come roaring back post-COVID. Global demand in 1Q23 surpassed 102 mm barrels per day — three million barrels above the 1Q19 (pre-COVID) level and almost 2 mm b/d above the International Energy Agency’s (IEA) 1Q23 estimate. Strong demand and faltering supply led OECD countries to release 250 mm barrels of oil from their strategic petroleum reserves to keep prices from surging. Given the seasonality in demand and China’s ongoing reopening, the 4Q23 demand could surpass 104 mm b/d.

    From here on out, just six counties in West Texas must meet all global demand growth. Given the strategic importance of the Permian, it’s imperative to understand its underlying health. Using our neural network, we have updated our basin analysis, and the results are shocking. The Permian is likely less than a year from peaking and starting its decline. The only source of non-OPEC supply growth is now primarily tapped out.

    Toyota, is the only company whose CEO publicly acknowledged peak oil afaik. The fact that they recently came out and said EVs aren’t the future indicates they have their head on their shoulders and have diligently kept their eyes on oil production, like an automobile company should be doing.

    Energy Wars

    Not A Great Day For Liberal Woke “Marxists”

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    by Capitalist Exploits

    This was the remark from Lucas when we at HQ were viewing the following.

    And this beauty…

    Then this…

    While on the topic of imbeciles, morons, and clowns, there’s also this:

    The mine is so important for Warsaw that it has in effect been paying the EU to keep it open. Poland defied the court’s 2021 interim order for it to stop mining and refused to pay the resulting daily fine of €500,000. In response, the European Commission began deducting the fine from EU funds earmarked for Poland — withholding €68mn in total — while Poland separately paid €45mn to the Czech Republic in compensation for environmental damage and to get Prague to drop its lawsuit.
    Brussels has also excluded the region around Turów from EU subsidies for places that transition away from fossil fuel production.

    It’s almost as if they need coal.
    Speaking of which, Turkiye, a country I’ve been telling you is NOT going to go along with the woke ESG shullbit, just tossed the climate alarmists aside like a rag doll.

    Jeez! Doesn’t he realise the existential threat to humanity here? Clearly an unhinged extremist. Probably misogynistic, too. Definitely actually, after he arrested all the pink-haired folks who were trying to parade their bits in front of children in Istanbul during pride month.
    From the article:

    President Recep Tayyip Erdogan on Monday dismissed environmental protests over the felling of trees to expand a coal mine in southwest Turkey, saying the campaign was led by “marginals”.

    Marginals? So he’s not going to let a few radicals dictate to the majority? Must be undemocratic.

    This power plant, which produces almost two-thirds of the electricity consumed in the southern Aegean, contributes around one billion dollars annually to our country’s economy,” Erdogan said in a televised address after the weekly cabinet meeting.

    He said the power plant needed to continue production with new coal basins as the existing reserves were close to depletion.

    Coal power plants have become once again a major source of energy in European countries after the crisis that broke out with the Russia-Ukraine war,” he said.
    “Although some are constantly and persistently trying to re-play the same scenarios with different skins, nobody is deceived by this game anymore,” Erdogan said.

    He can’t possibly be referring to the Soros-sponsored “NGOs” that have actively been working throughout Eastern Europe and the Caucasus. Nah, that’s crazy talk.
    Actually, on the entire climate change fraud, I found this:

    Now, to be clear… before we get any hate mail telling us what a bad man little Erdy is, realise this. They are ALL power hungry psychos. They are simply psychos with differing agendas, and it is our job to arbitrage those agendas for our own prosperity and freedom where possible.
     

    Energy Wars

    China’s Weapon in the Global Fight for Resorces

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    The Belt and Road Initiative is proclaimed to be an act of solidarity with developing nations. It is, but it is also so much more

    by Timur Fomenko, via RT

    “China’s overseas investment in metals and mining set to hit record,” declared an article in the Financial Times. The piece analyzes how China’s investments in the Belt and Road Initiative, a massive global infrastructure program, have become more “strategic.”

    While the FT is notoriously negative about China and spares no opportunity to rush into narratives pertaining to ‘debt traps,’ claims of corruption, and how ‘dozens’ of countries are reviewing them (only citing US-pressured Italy as an example), it nonetheless makes a key point here. The BRI is strategic. But it was never anything else.

    While China has framed the massive investment scheme as an act of solidarity with developing countries, pledging economic integration and mutual gains, the colossal creation of infrastructure by Beijing in other countries has never been random, discrete or disorganized. The goodwill gained of course matters, but there was always a plan, and that plan was not only to keep China’s exports rolling, but to also to secure energy and resources in an international environment that is increasingly uncertain, and in anticipation of what the US was about to do.

    China is the world’s largest consumer of energy and natural resources, but has a strategic Achilles heel in that, beyond critical rare earth elements, it doesn’t have as many resources as it needs. As an industrial giant, China cannot satisfy its own needs for energy whether it be to power its factories or to fuel its cars. This has resulted in Beijing forming increasingly lucrative and close partnerships with the nations of the Middle East, which have tilted away from their traditional patrons in the West accordingly.

    At the same time, a global competition for natural resources is picking up pace. The US, using the language of ‘supply chain resilience’ and ‘diversification,’ is seeking to gain control over resources it deems strategically critical, such as lithium and many other metals and minerals. The US wants to dominate all of these global supply chains, and eventually isolate China from them, leading to a competition regarding investments throughout the world. Supply chains are no longer globalized but are being carved up to fit the strategic needs of individual countries that want to be self-sufficient, should a military crisis emerge.

    Consequently, this military factor is a huge dynamic in China’s strategic thinking, given that its imports of materials and energy have been reliant on crossing through areas which are now being contested by the US, including the South China Sea, East China Sea and the Indian Ocean.

    Washington is attempting to comprehensively encircle China’s periphery. The BBC applauded this as an “arc of bases around China,” with the US having recently gained access to even more military sites in the Philippines. It then received a military access deal with Papua New Guinea, while backing the full rearmament of Japan and placing more weapons on the Korean Peninsula.

    In the event of any conflict, the US would like to seek military dominance over China’s surroundings (as unfeasible as that is) and attempt to embargo its foreign trade and energy imports. How did the British Empire triumph over Germany twice? The answer is through naval supremacy, by blocking Berlin’s access to the Atlantic and Mediterranean, and crippling it with attrition in the long run.

    China’s Eastern periphery is similarly vulnerable. This is why China is using the Belt and Road initiative to connect Eurasia by land in ways which allow it to bypass these contested areas and create new routes for energy and materials.

    This, in turn, is why China’s most critical strategic partner in the entire Belt and Road project is Pakistan, a country that not only connects to China by land, but extends southwards to the sea bypassing the whole Indian subcontinent and offering a free route to the Middle East. Pakistan is also a formidable military power with nuclear capabilities, discouraging any potential attack by the US and its allies in any potential conflict with China. Through Gwadar Port, China intends for Pakistan to be its primary maritime gateway concerning the Middle East and Africa, marking a safe passage for oil and natural gas.

    This is also why China’s partnerships with Russia and states in Central Asia matter. Beijing has invested overwhelmingly in creating transcontinental railway freight routes, and hosted its first ever Central Asian leaders summit this year. It’s also one reason why, despite the upheaval in Afghanistan, China seeks to have a close relationship with the Taliban and procure access to that country’s natural resources.

    In conclusion, the BRI is a master chess game by China, because it embodies diplomatic, trade and strategic priorities. Look, for example, at how the new China-Laos railway has established an additional commercial route into the country for the landlocked Laos, which will soon be connected all the way down to Thailand and its ports. China is actively diversifying its logistical routes while keeping other countries on board. It’s about breaking US attempts to dominate China by militarizing the area around it, cutting off access to goods and preventing a return to the “gunboat diplomacy” of the 19th century.

    Energy Wars

    More Energy Resources Added to Russia’s Control

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    Rapprochement between Russia and Niger makes the West dependent on Moscow

    According to Bloomberg, if Niger falls into Russian orbit, the world will become even more dependent on Moscow for nuclear energy.

    It is specified that Kazakhstan and Uzbekistan are among the world’s leading producers of uranium, which account for about half of the reserves mined in the world. If we add Russia and Niger to this, then the share will jump to 60% and above.

    In addition, Russia has uranium deposits, and the country itself controls almost 50% of the world’s enrichment capacity.

    via https://t.me/+fZp0Os56l5ZkMzdi

    Energy Wars

    Is Kazakhstan Next after Ukraine in Russia’s Crosshairs

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    via  Politnavigator


    ❗️The ruling Kazakh elite is firmly following the path of Ukraine. We have repeatedly written that Kazakhstan is turning into an outpost of the Anglo-Saxons in Central Asia. This was once again confirmed in the case of detention by Kazakh customs officers of a batch of drones on their way from Kyrgyzstan to Russia. 
    We are talking about the actual expropriation by the Kazakh side of 14 DJI AgrasT30 drones. Each such seized Chinese-made heavy drone is estimated at 1.1 million rubles, and the total cost of the entire batch is 15.8 million.
    As a result, the Kazakh authorities fined the Kyrgyz company Impuls-Invest LLC, Astana received praise for maintaining the sanctions regime against Russia, and The Washington Post published an article condemning Kyrgyzstan, just before the introduction of secondary measures against this mountainous republic. And then the US imposed sanctions against four companies from Kyrgyzstan. Local authorities began to justify themselves to the Americans – they say that the goods were sent to Russia not by government agencies, but by private traders. Bishkek was forced to promise that it would strengthen control over the flow of goods. That is, in fact, a whole operation was carried out with the participation of the Kazakh authorities, in order to use the example of Kyrgyzstan to intimidate and exponentially punish for participating in gray imports in favor of the Russian Federation.
    This is a signal to all the former Soviet Central Asian republics – if you help the Russians – we will strike not only at private companies, but also at the assets of the ruling elites in the West and offshore. Astana, on the other hand, plays the role of an open US agent in Central Asia, which not only participates in the isolation and strangulation of the Russian Federation, but also as a Western provocateur. This is the strongest blow to the EAEU and the principles of free trade.
      In Kazakhstan, two-thirds of the entire extractive industry is controlled by American, British and European companies, and now, as in the 90s, deposits of rare earth metals and precious stones are falling into the hands of the West through enslaving production sharing agreements for decades.
     
    Energy Wars

    “Nord Stream 1-Blast: It Was a Mini Nuke!”

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    A report by Attorney at Law Viviane Fischer, photo Wigwam nuclear test of the USA, 1955.

    Swiss physicist Dr. Hans-Benjamin Braun has meticulously analyzed the Nord Stream 1 explosion. His finding, presented to the Corona Investigative Committee on June 30, 2023: the blast was made using a thermonuclear (fusion) mini-nuke with the greatest possible shockwave impact on Russia’s Kaliningrad. Like the investigative journalist and Pulizer Prize winner Seymour Hersch, Dr. Braun suspects the USA behind the attack. Among the authorities, politicians, journalists and scientists whom he has informed of the results of his analyses since December 2022, there is one thing above all: radio silence.

    Dr. Braun is a renowned scientist specializing in statistical physics, quantum physics, neutron scattering, condensed matter physics and materials science, magnetism and topology. For years he taught as Professor of Theoretical Physics at the Catholic University of Dublin. In 2014, he was honored to be one of four “Distinguished Lecturers” (editor’s note) worldwide from the Institute of Electrical and Electronics Engineers IEEE, Magnetics Society, who has given 50 lectures internationally at the invitation of individual institutions or sections. Dr. Braun has widely cited publications in Nature Physics, Nature Communications, and Advances in Physics.

    The puzzling, contradictory public interpretations of the explosion event at the pipeline at 17:03 UTC on September 26, 2022, had piqued his scientific curiosity as a physicist who also holds a master’s degree in earth sciences, Dr. Braun reports. Why, he wondered in this context, did the UN Security Council not initiate an investigation despite the many unanswered questions.

    In October 2022, he set to work analyzing what had happened via six entirely independent methods: Evaluation of seismic data according to two methods, analysis of the development of aerosol clouds after the detonation, consideration of underwater currents in the Baltic Sea, especially in an underwater canyon between Bornholm and Kaliningrad during the following days, temperature development on the seafloor, and spread of a possible radioactive fallout after the blast.

    The surprising result: the seismic measurements suggest an explosive force in the equivalent of up to 1-4 kilotons TNT, a strong contrast to the estimated data of an equivalent of 250 kg TNT published e.g. in the renowned magazine Nature.

    © Dr. Hans-Benjamin Braun

    The comparison of seismic measurements in the Baltic Sea, e.g. of Sweden and Finland with the values of the well-documented North Korean nuclear event also identified by the Columbia University Earth Institute on the basis of IRIS data shows a very similar pattern.

    © Dr. Hans-Benjamin Braun

    According to the infrared satellite data, four hours after the detonation a distinct aerosol cloud with an extension of up to 100 km was formed away from the explosion site in wind direction and in the Kaliningrad region due to the impact of shock waves on the steep Kaliningrad shoreline. Such a phenomenon would not occur to this extent with a much smaller explosive charge, Dr. Braun said. The opening photo of this paper shows aerosol formation during the U.S. “Wigwam” nuclear test, with an explosive force equivalent of 32 kT, in 1955 in the Pacific Ocean, 900 km southwest of San Diego.

    © Dr. Hans-Benjamin Braun

    During the days following the detonation moment, significant underwater currents have been formed in the Baltic Sea (~50km and more), focusing into the underwater canyon directed directly towards Kaliningrad. As a result, a vortex current formed in the Bornholm Basin. According to the Nature publication of March 15, 2023, the explosion stirred up 250,000 tons of sediments that were subsequently deposited. Indeed, it appears that this process also affected water temperatures on the seafloor during the whole winter time.

    Remarkably, according to satellite data, the water temperature at the seafloor increased by up to 5 degrees Celsius year-on-year over an area of circa 100 km x 100 km in the winter of 2023 compared to 2022. Dr. Braun clarifies that this cannot be explained by natural fluctuations, especially since the mean temperature in the more distant regions of the Baltic Sea tends to be even lower.

    © Dr. Hans-Benjamin Braun

    In Poland, radioactive fallout was detected one day after the blast; in Switzerland, it showed up three days after the event.

    Highly noteworthy, Dr. Braun said, is that the blast site apparently must have been chosen to reflect and amplify shock waves due to the elliptically shaped Swedish coastline, allowing them to focus precisely on Kaliningrad via the underwater canyon. The city, 500 km away, experienced a seismic effect 10 times greater than that of neighboring Bornholm, which is only 70 km from the pipeline blast site.

    Dr. Braun’s investigative conclusion: “None of the seven independent geophysical observations can be explained by the use of a conventional explosive; a thermonuclear weapon must have been used. The Nord Stream sabotage was also a targeted shockwave attack on Kaliningrad, which to me makes the U.S. the only plausible culprit.” He considers a tactical self-endangerment of the Russians by the detonation unlikely, Ukraine as another possible aggressor does not possess nuclear weapons. The U.S., however, had nuclear weapons, delivery systems and, through NATO’s BALTOPS 22 exercise in the Baltic Sea, which took place in June 2022, extensive fresh barythmetric knowledge of conditions at the eventual site. “BALTOPS also provides a unique opportunity for the U.S. Research, Development, and Acquisition communities to exercise the current and emerging UUV technology in real-world operational environments. This year featured the current and future programs of record for mine hunting UUVs in the MK-18 and Lionfish systems. Both systems were put through the paces over 10 days of mine hunting operations, collecting over 200 hours of undersea data,” writes the U.S. NAVY under the heading “BALTOPS 22 a perfect opportunitey for research and testing new technologies.” Of course, a collaboration of other geopolitical interest groups besides the U.S. would also be conceivable, Dr. Braun adds.

    Precisely such an autonomous underwater drone as the Lionfish, which was tested during the NATO exercise BALTOPS 22, could have been used to transport the explosive charge to the scene, Dr. Braun elaborates. To actually carry out the detonation using such an unmanned vehicle would have required the involvement of only a few people. It is clear, however, that if the USA were involved, it would have to be assumed that the blast was carried out with the knowledge and will of US President Joe Biden. The U.S. company Sandia Labs, a longtime partner of the U.S. Department of Energy’s National Nuclear Security Administration (NNSA), writes on its website: “The nation’s nuclear weapons must always work when commanded and authorized by the president of the United States, and must never detonate otherwise.” The U.S., Dr. Braun notes, is incidentally the only country in the world that has not joined the international ban on a nuclear first strike.

    Dr. Braun reports that he made his findings available to selected journalists and politicians on December 22, 2022, seven weeks before Seymour Hersh’s article appeared. On January 3, 2023, he reportedly informed the Swiss government, and on January 25, 2023, he informed the Swiss parliament. At the same time, he wrote to a colleague at MIT, who drew his attention to the imminent article by Seymour Hersch. On March 27, 2023, he had contacted Prof. J. Sachs as a representative of the UN Security Council, and on April 4, 2023, he had formulated an open letter to the Secretary General of NATO, the Finnish and Swedish governments, and three Nobel laureates in physics. On April 4, 2023, he had written to the International Criminal Court in The Hague, the White House, the Kremlin, the Russian and Chinese embassies in Switzerland, and on April 24, 2023, again to the UN Security Council, this time under the new Russian chairmanship. The answer: radio silence.

    Dr. Braun demands that the matter be completely clarified. Due to their easy scalability, with which one can adjust the detonation strength by a factor of 100 with a flick of the wrist (so-called “dial a yield”), thermonuclear weapons pose an increasing threat to humanity, especially through the combination with rapidly advancing artificial intelligence, which is used in autonomous air and underwater vehicles, and can also be used in covert operations.