Reddot from the oil drum reposted this comment from an oil company insider, the original posting was in 2008. Really this says it all. The gap between what Television and the corporate media are telling us and what they are telling themselves is pretty massive.

I didn’t want this to just vanish, so I’m also reposting it here.

reddot on May 1, 2010 – 4:58pm Permalink | Subthread | Parent | [Parent subthread ] Comments top

Relayer, ex-AMOCO, posted Sept 2008 on TOD an insider’s view of the current scene and BigOil knowledge of Peak Oil:[begin quote]

“Thank you and all contributors very much for all the hard work that goes into pieces such as this.

I have been lurking almost since the inception of this site and consider it one of the best places on the web for info and informed speculation on the oil situation.
I have refrained from contributing in the past, for the most part having not much of import to add that someone else has not already said. But one detail I would like to comment on.

The MSM have been touting the current link between high gasoline prices and refining capacity. Sure, there is a short term problem here, but only short term.
I began my career with Conoco in 1971. I distinctly remember meetings in the mid 70s in which it was stated that no more new refineries were going to be built in the U.S. We had enough existing capacity along with future upgrades to existing refineries to take care of foreseeable production. Small wonder that no new refineries have been built here since 1976.

Most of the world had been well explored for quite some time already, the U.S. peak was finally accepted, and the big question was where to risk capital next? Offshore, yes, North Slope, of course. The North Sea was a pleasant surprise. Nigeria was the last place in the world Conoco wanted to go, lol. One of the countries they considered ‘relatively’ stable was Venezuela. Well, that worked out ok for some time, but now look, nationalized.

The early 80s saw a mini-repeat of 73, rumours abounded that it was actually caused by an unexpected high water carry-over in North Ghawar wells. These rumuors were quite interestingly ignored by the MSM.

I switched to Amoco in 1985. Interesting difference in corporate cultures and direction. In 1989 all of us in the ivory tower in Chicago (some 5000 people) were treated to a series of presentations based on decisions that resulted from years of analysis in tandem with some outside consultants.

The big takeaway from this was the fact that they stated that Amoco would most likely not exist as an independant concern by the end of the century due to the need to Get Big in order to afford the risk entailed with going Deep Water.

In 1999, 10 years later, they ‘merged’ (lol) with BP. One of the stipulations of the takeover was that BP would no longer stand for British Petroleum, thus the moniker Beyond Petroleum. (This was a hint, lol.)

I mention this only to point out that the majors have not just been blindly running around with no clue.
It is my belief that at least some people in virtually ALL of the majors have a very good idea of what the future holds, at least in a general sense. It is the details only that defy prediction.

Virtually all of the majors have investigated the alternatives, biofuels, wind, solar, geothermal, tidal, you name it. Amoco owned the then largest manufacturer of Solar cells- Solarex. (There’s the Beyond part, hehe.) Back in the 70s Phillips, along with the Feds, built a commercial scale plant for oil extraction from oil shale in Colorado. Too expensive and energy intensive was the conclusion.

There are numerous examples within the industry. When I hear Congressmen call for the oil companies to plow profits back into research I just have to laugh. Who do they think has done the lions shares of the research fo far?

Personally, I am very much impressed with how closely they tagged our need for refining capacity. We are bumping up against our max present capacity just as production plateaus.

I am dismayed at RR talking about no awareness of Peak Oil within the industry. The clues have been there for at least 30 years, longer if you stretch.

I liken it to a good game of Chess, the opening is long past, the players have developed their strategies and developed their positions as well as possible. A few combinations have been attempted, some fients here and there. Serious mis-direction now and then. We are now deep into the mid-game, who are the survivors going to be?

Rest assured that if I knew I would have posted it long ago. I never achieved a position high enough to be included in the schemes of the high and mighty, lol. Just hints, clues and paying attention to what everyone was doing as well as possible. It didn’t really click for me for sure until March 17, 2005. Again, all the clues were there, but only if you were looking I guess.

I am out of the oil business now, being caught in the aftermath of the BP/Amoco rationalization in 2002 and now am in the hazardous waste business, how fitting, lol. ‘Oil man attempts to expiate for lifetime of sins’, rofl.

Yes, the entire situation rather boggles the mind doesn’t it. I recall the SUV/light truck exemption thing (late 80s was it?). Could simply NOT believe it… By that time I had managed several different facilities and watched untold millions of gallons of product pass through.

All of the majors were going farther and farther afield for the next batch of product. It just did NOT take any deep thinking to realise that this couldn’t go on forevor.

And then they go and do this… Pretty much puts an end to the oil company/car manufacturer conspiracy theories. GM, Ford and Chrysler go bonkers building these behemoths and pretty much neglect the bottom end of the market place, giving up huge market share in the process. Can you say bad management? And they have the gall to blame their problems on unions and entitlements, omg.

I can only chalk it up to multiple cases of the rich and powers-that-be looking out only for themselves, a supremely human condition it would seem. How much communication is there at that lofty level of society?

Let’s face it, the oil companies themselves have known for decades that oil wasn’t forevor. They all have had R&D divisions working on alternatives for decades. The ones that I have worked for have, internally at least, touted themselves as Energy Companies, not just oil companies, once again, for decades now. Only recently have you seen some of them proclaming this publicly.

Were they all thinking that technology would have the solutions when it became necessary? And now here we are on the edge of the precipice and nothing has presented itself, in spite of Big Money having been thrown at it already.

Some of the players, if not all, at the top of the oil companies have to have ideas and plans for further personal prosperity. Do these plans include us? Do they talk to their peers outside of the industry? How far and wide is the knowledge spread?

It may be telling that we have oil men in the White House now. I hope they have better plans than what I have been able to discern so far.

Just look at the players and what they say.
BP- all is well says CEO Sir John Brown, oops, got caught lying to a judge, yer outta here says the Board of Directors, valiantly trying to cover their butts. But governments and media continue to base plans for the future on the BP statistical revue. Meanwhile 12 BP traders indicted within the Natural Gas Liquids department for LPG futures manipulation.

Exxon CEO says no such thing as Peak Oil, well for 50 years at least. But somehow has not been able to increase reserves.

Pickens and a few others are not afraid to tell the truth. CNBC has Pickens on for an hour as a guest host one morning in May 2006. He says several times that Production is peaked. He also states Ethanol is a non-starter and even explains, in an easy to understand way, why. When he is gone CNBC goes back to their regular programming and does not mention the salient issue of our lifetimes again that day.

Chevron CEO probably the most honest of the Major bigwigs so far. He is on record, within the last month or so only though, as stating it’s a problem of scale. Any decent % reduction in a 21 million bpd habit is a pretty tall order. There, we have it, the truth is out. But did anyone notice? Pretty brave statements actually in light of his position.

This refining capacity talk is just another red herring thrown out in a long line of mis-direction for the masses imvho. I am not going to be distracted by it.

Yes, I agree the middle class is toast soon. We should have been working on population reduction and per capita energy use reduction a couple of decades ago.
Sorry for my rambling, but I have worked over 30 years in the business and can not help but be fascinated by the developments and machinations as they become apparent.
The worst part is that my youngest son is 9 and I struggle with how I can best prepare him for the future.

Interestingly enough, it was some time in the 70s that Conoco sent out copies of ‘The Seven Sisters’ to ALL employees and made it virtually required reading. I have to admit it was very engaging and illuminating.”

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