In the endless war of words over whether it’s a war about oil (meaning the current war in Iraq, not the prior war in Iraq), people sometimes bring up the issue of what US Vice President Dick Cheney said in a public appearance in 1999, what it implies about his knowledge of peak oil, etc. The speech was at the London Institute of Petroleum, on November 15 of that year.

You can find the entire text (with an annoying lack of paragraph breaks) here.

Quoting the most often quoted portion from that source, Cheney said:

From the standpoint of the oil industry obviously and I’ll talk a little later on about gas, but obviously for over a hundred years we as an industry have had to deal with the pesky problem that once you find oil and pump it out of the ground you’ve got to turn around and find more or go out of business. Producing oil is obviously a self-depleting activity. Every year you’ve got to find and develop reserves equal to your output just to stand still, just to stay even. This is true for companies as well in the broader economic sense as it is for the world. A new merged company like Exxon-Mobil will have to secure over a billion and a half barrels of new oil equivalent reserves every year just to replace existing production. It’s like making one hundred per cent interest discovery in another major field of some five hundred million barrels equivalent every four months or finding two Hibernias a year. For the world as a whole, oil companies are expected to keep finding and developing enough oil to offset our seventy one million plus barrel a day of oil depletion, but also to meet new demand. By some estimates there will be an average of two per cent annual growth in global oil demand over the years ahead along with conservatively a three per cent natural decline in production from existing reserves. That means by 2010 we will need on the order of an additional fifty million barrels a day. So where is the oil going to come from? Governments and the national oil companies are obviously controlling about ninety per cent of the assets. Oil remains fundamentally a government business. While many regions of the world offer great oil opportunities, the Middle East with two thirds of the world’s oil and the lowest cost, is still where the prize ultimately lies, even though companies are anxious for greater access there, progress continues to be slow.

One of “the” people in the peak oil community is Kjell Aleklett of Uppsala University and President of the Association for the Study of Peak Oil. His highly recommended discussion of this Cheney speech is Dick Cheney, Peak Oil and the Final Count Down [7 page PDF].

Even though I remain convinced that in one form or another both the 1991 Gulf War and the current war in Iraq (which seems to not yet have earned an official name, strangely enough) were “about oil”, this Cheney speech proves nothing. OK, it proves he knew enough about the importance of oil and the realities of the oil business, not to mention the brutal facts that apply to a non-renewable resource (such as it not lasting forever, production inevitably peaking, etc.), to be an executive in a big oil company like Halliburton, but is this really news? In 2008, who among us over the age of about 10 needs further evidence about Dick Cheney’s, shall we say, aggressive pursuit of his goals?

For those who missed it, my most recent take on this whole war for oil question is Thinking the unthinkable.


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