Ryan Carlyle is a Subsea Hydraulics Engineer whose job is directing the installation and operation of seafloor equipment designed to make sure subsea oil wells can be safely drilled and completed. He also reads a lot.
And it shows. His latest article in Forbes is one of those “facts everyone should know about oil” articles and then he goes ahead and proves it:
1. Oil drives the world economy, accounting for one-third humanity’s energy supply. If natural gas is included, the two together provide half.
2. Oil and gas powers 100% of all transportation “except for a minuscule number of electric-powered vehicles.”
3. The industry is gigantic, almost beyond measure. For instance, just the natural gas pipelines in the United States could stretch from the earth to the moon and back 8 times.
4. At any given moment, 40% of all seaborne cargo is oil.
5. There is no possible way that wind or solar is going to make any perceptible dent in these massive numbers:
This is going to make some people mad, but it’s reality: not only is oil and gas critical now, but there are no viable replacements in our lifetime. People who think renewables can replace oil with a few decades of Manhattan Project style effort are simply ignorant of how big oil really is.
He uses an interesting analogy:
The difference in power generation between solar power and oil production is more than the difference between a professional bicyclist and a Formula 1 racecar.
The average speed of bicyclists in the Tour de France is about 30 mph. The average speed of a Formula 1 racer is 200 mph with some approaching 230 mph. I liken it to the difference between a lightning bolt and a lightning bug. Either way, wind power is ridiculously insignificant in the overall energy equation, and will likely remain so not for years but for generations.
He puts it into perspective:
To match oil, you’ll need half a century or more of clear energy superiority. That means cleaner and cheaper and more concentrated for storage. Nothing fits the bill yet. To replace oil, you’ll need a century to allow the entire economy to retool and realign around the new technology.
6. The more energy people use the higher their standard of living becomes.
7. Working on an oil rig is very safe:
To really put safety in perspective, the average 2.1 TRIR [Total Recordable Incident Rate] for rig operations is lower than the 3.3 TRIR for real estate. You are safer statistically on the rig floor than driving around with a real estate agent!
8. Big oil doesn’t really make very much money. The profit numbers are huge because the industry is huge. But how would you like to working in an industry where:
Your product is the same as your competitor’s
The pricing of your product is out of your hands
Half of the money you invest in new wells is lost forever
A mistake can cost you billions
You’re competing with nationalized companies with deep pockets
Those countries have a nasty habit of nationalizing yours
It’s highly regulated, and
You have a huge PR problem.
Carlyle says: “Frankly, it’s a miracle anyone wants to be in this business at all.”