Peter North: Fossil Fuel Limits & Dependencies

Our global economic system and societies are sustained by finite fossil fuel resources, writes PETER NORTH and oil production is due to peak within the next ten years. Yet instead of conserving the vital resources, fossil fuel use continues to increase. Many are aware of the increasing price of fuel for motor cars, but most people seem unaware of our wider dependence on fossil fuels for food production, plastics, pharmaceuticals, synthetic rubber, textiles, automobiles, packaging, building, construction, electronics, general manufacturing etc. Society urgently needs to develop a plan for survival to deal with relinquishing dependence on fossil fuels. Every day no action is taken narrows the window of opportunity.

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In 1956, M. King Hubbert, US geologist for the Shell Oil company, published the prediction that later brought him fame. He predicted oil production from US wells would peak around 1970, then gradually decline. He also predicted the shape of the production curve over the lifetime of oil fields would be a bell-shaped curve, similar to the normal distribution curve. His predictions were derided at the time by oil industry executives who then foresaw an almost endless discovery of future oil fields. But as thing turned out, Hubbert’s predictions were uncannily accurate. U.S. oil production did peak in 1971, and commenced a gradual decline. Now well accepted, the bell-shaped curve of production against time of an oil field became known as “Hubbert’s Peak.”

In recent times, interest has centred not so much on peak U.S. oil production, which is now history, but on peak global oil production, and from the future production of other fossil fuels - natural gas and coal - which also have their Hubbert’s Peaks. Thirst by the human species for these resources is relentless. Like everything else in the economy, fossil fuel use rises year by year at an exponential rate. Consumption of fossil fuels has been rising for about 2% per annum for a long time. That the fossil fuel bonanza will eventually run out has been a topic of concern for decades – and is usually assuaged by assurances from politicians, economists and oil industry executives, but rarely from geologists.

To answer resolve the question of supply and demand for fossil fuels, a number of researchers have used Hubbert’s work to determine “Hubbert’s Peak” for the entire world’s oil supply.[1] The answers they produce vary, but the general consensus is Hubbert’s Peak for global oil is most likely to show up within the next ten years, and the peak for global natural gas in two or three decades.[2] Coal will be the last of the fossil fuels to deplete.

Hydrocarbon Feedstocks

Given the likely consequences of a shortage of fossil fuels, public concern on this issue has been muted – at least until the oil price started heading up in 2004. Even so, consumption continues as it has since the conveniences of modern life became widespread. Those filling up at petrol stations perhaps grizzle about the price while they fill up their tanks. People continue to turn on the electricity and gas appliances and expect their energy sources to oblige. Very little attention is paid to the source of supply behind the petrol bowser, the electric light switch or the gas cooker. That these appliances will continue to dispense their services into the distant future has been implicitly assumed by most of us. How many users of hydrocarbons know that the last year in which the rate of discovery of new oil equalled the rate of consumption was 1981 and ever since then we have been drawing down our stocks of known oil? How many know that the year of maximum discovery of new oil was 1964? Practically the entire globe has now been searched for new oil. Almost certainly no massive new oil fields remain to be discovered.

Why this information has attracted such little interest a story of its own. If they think about the subject at all, people might ask how the brave new post-oil age will survive without oil and gas energy for its transportation systems, in particular cars, and perhaps for its power generators. These are the things that seem to affect people on a personal level. But indirect effects could be just as important, though less obvious. For the end of the fossil fuel era has another aspect - the dependency on hydrocarbon feedstock of a chain of basic, secondary and tertiary industries. As the fossil fuel era draws to a close, the world must not only adjust to energy shortages, it must either find new sources of raw material for some its most fundamental industries, or do without these industries completely.

Petrochemicals

Currently, petrochemicals are the first link in a chain of industries that ultimately use hydrocarbons as raw materials. This industry is at the head of a supply chain that generates a vast range of goods. The industry converts large quantities of the lighter hydrocarbon fractions, mostly natural gas, into a few basic chemicals. To drive its chemical reactions, it needs not only hydrocarbon energy, but also the very stuff of hydrocarbons, carbon and hydrogen as raw materials.

Plastics, pharmaceuticals, synthetic rubber and textiles are a few of the many industries that rely on a supply of raw material from petrochemicals and in turn from fossil fuels. Synthetic fertilizers are another major user of hydrocarbon feedstocks. All these industries are threatened by a future raw materials supply crisis. We are rapidly moving towards Peak Oil, followed by declining natural gas availability, and finally to coal depletion.[3] In considering the post-hydrocarbon era, we need to examine the effects of increasing shortage, or even complete absence in the supply of hydrocarbon feedstock to vital industries. What will be the effect on the industries themselves? How will absence of these industries affect the world’s population? Can these industries be restructured to increase the chances of surviving the final energy crisis?

Plastics third biggest consumer of petroleum

Perhaps the leading example of the ubiquitous nature of the hydrocarbon-based industry chain is plastics, the third biggest consumer of petroleum products after energy and transport.[4] About 10% of total world refinery output, or around 650 Million tons per year, is used by the plastics industry for its feedstock and energy needs. Countless numbers of manufactured products are either made from plastics, or contain plastic components. Very few consumer products in today’s market-place contain no plastic parts at all.

The plastics industry started about 1870 with the invention of celluloid by John Wesley Hyatt, an American. Hyatt made his discovery after an accident when he spilled a bottle of the naturally occurring substance, collodion, and found it hardened into a ball. He experimented with additives and succeeded in making celluloid, which first became well known when billiard table manufacturers offered a $10,000 prize to anyone who would find a substance that would replace ivory for billiard balls. Economics dictated in the matter. Billiards was becoming popular at a time when supply of elephants was dwindling. While celluloid didn’t win the billiard ball competition, it was the world’s first recognizable plastic, and quickly found other uses. Bakelite, the other contender for first plastic, was developed in 1907, and is considered the first plastic made from fully synthetic material.

These early developments spawned an industry that has grown exponentially over a century or more. Plastics is an enormous vertically-integrated industrial-economic entity, in terms of revenue, physical infrastructure, people employed, use of energy and resources, and linkages with various upstream and downstream industries. Some of the world’s largest companies, Dow Chemicals, Dupont and Monsanto for example, produce the basic chemicals that are its building blocks. Downstream from these producers of bulk plastics are manufacturers of more complex plastics and manufacturers of plastics products. A large support industry serves manufacturers of plastic products, producing machinery for the plastics industry, such as plastic extrusion machines, plastic injection moulding machines and their associated dies. The plastics industry produces a wide range of intermediate and final goods (manufactured products used by other industries, or by final consumers), for a multitude of industries including automobiles, packaging, building and construction, electronics and general manufacturing.

The range of plastics on the market is enormous. But reduced to their common origins, commercial plastics are variants of a small originating family of organic compounds, made from the simplest components of crude oil and natural gas, the low molecular weight alkanes (the gases methane, ethane and propane).

The first link in the chain of the petrochemical industry is conversion of these low molecular weight alkanes into just two basic compounds, the alkenes ethylene and propylene. These two materials, gases at atmospheric pressure and temperature, have the key property on which the plastics industry depends – an ‘unsaturated’ or weakly-linked carbon-carbon double bond that facilitates ‘polymerisation’ or the linking together of molecules into a fantastic range of raw materials and final products. Ethylene and propylene are the two building blocks, of the plastic industry. Polyethylene (or polythene), made from polymerising ethylene and chemically the simplest plastic that can be made, is the world’s leading plastic measured by mass of material produced.

More complex plastics, like the polystyrenes, or polyesters replace a hydrogen atom with a benzene ring or some arrangement of atoms, nearly always itself drawn from petrochemical feedstocks. Whatever the plastic, the feedstock and the industry’s energy requirements are at present exclusively derived from oil and gas. Unless another source of feedstock can be found, the plastics industry, in its present form, can only continue as long as world oil and gas supply lasts.

Plastics and the post-oil era

Economists, when challenged about shortage of resources say substitutes will always be found, therefore the growth economy can continue indefinitely. “Technology will provide” is their standard mantra. The faith of economists in technological solutions is touching but naïve and not shared by technologists charged with the task of producing technological solutions. To date no effective, cheap or large-scale alternative has been found to substitute “something else” for oil and gas feedstock, though suggestions have been made.

One touted remedy is to simulate the traditional feedstocks of hydrocarbons by sourcing the hydrocarbons from growing plants, which are themselves essentially hydrocarbons. Limited research has already been conducted into genetic engineering of plants designed for feedstock to the petrochemical industry.[5] But the world’s arable land is now fully occupied producing enough food to feed a world population still growing at about 70 - 80 million a year. As Mark Twain once remarked about land, “they ain’t making any more of it.” In fact, the amount of arable land in the world probably peaked some years ago, and is now declining through a combination of commercial development, erosion, water shortages, water quality problems, desertification, spreading salinity and acidity, and various other consequences of man’s disastrous impact on the environment.

Additionally, researchers conclude, the amount of land needed to grow feedstock replacement biomass would be prodigious. Estimates from different authorities vary, but as a solution to the post-oil energy problem, the biomass solution cannot, on the most optimistic assumptions, provide the complete solution.

For example, a rough average figure to drive the present transportation system of the U.S. from ethanol made from biomass would require plantings of an area about twice that presently under crop.[6] The underlying problem for biomass solutions to fossil fuel depletion is the intrinsic energy inefficiency of nature’s photosynthetic process. Only about one percent or so of incident solar energy ends up in the plant. Even tomorrow’s genetic modifications offer little prospect that the growth rate of plants will increase a million-fold! On balance, the proposal to grow plants for making plastics is probably no more workable than similar proposals to grow biomass for bioethanol and biodiesel fuels. We must seek our feedstock for tomorrow’s petrochemical industries elsewhere. So where do we look?

Reduce demand - culture change

The two principal chemical elements that go into making petrochemicals are hydrogen and carbon. These elements are present on the planet in large quantities in various forms. An essentially limitless amount of hydrogen in oceans can be separated from oxygen by electrolysis providing sufficient energy is available for the process. The obvious immediate sources of carbon are coal, carbon dioxide of the atmosphere and carbonate rocks.

But making petrochemicals from these sources is much more difficult than making them from hydrocarbons, which bring carbon and hydrogen to the petrochemicals industry in a particularly convenient form. Carbon and hydrogen in hydrocarbons are already chemically combined with each other, storing in their chemical bonds energy supplied by the sun of a distant time and perhaps the heat energy of compression and radiation acquired from millions of years locked in the crust of the earth. In the post-oil and gas era, a plastics industry is theoretically possible, but will be a great deal more difficult, and require much more energy per unit of production.

In view of the supply side problems of this industry, the demand-side merits attention. Potential certainly exists to reduce demand. Much of the massive amount of plastic now manufactured is wasted as throwaway packaging materials. One option, and by no means the complete solution to surviving the future shortage of feedstock, is to throw away less of the product. Another option is to recycle more. Comparing waste disposal habits of California and Finland suggests a great deal of waste can be avoided simply by a culture change. In California recycling rates for plastic containers peaked in 1995 at about 24% and declined to 18% by 1999.[7] By contrast, Finland in 1997 achieved a recycling rate for similar materials of 64 per cent.[8]

Synthetic Fertilizers and the post-oil era

The chemical principle for fertilizing plants is “fixing” nitrogen, which means supplying nitrogen to the plant in a form plants can readily absorb.[9] The synthetic fertilizer industry, like the plastics industry, has one simple, basic ingredient from which most of the products of the industry are derived. This ingredient is ammonia.

Ammonia (chemical formula NH3) is made by synthesizing nitrogen and hydrogen at high temperature and pressure using the well-proven Haber-Bosch process. The Haber-Bosch process was first introduced in 1910, and is still standard technology for ammonia manufacture. As for the petrochemical industry in general, the role of hydrocarbon in the synthetic fertilizer business is to provide both energy to the process as well as material, in this case hydrogen. The other element needed to make ammonia, nitrogen, comes from the atmosphere, where it is effectively in unlimited supply.

After synthesis, ammonia is converted into chemical compounds that are the final products of the fertilizer industry – urea and ammonium salts (such as sulphate and nitrate). Urea is made by reacting ammonia with carbon dioxide. Ammonium nitrate is made by reacting ammonia with nitric acid. Ammonium sulphate is mainly sourced as a by-product of various other chemicals. The final products, ammonium salts and urea, are white crystalline substances that readily dissolve in water. Fertilizer products can thus be carted around as granular solids, in bags or in bulk. At point of use, they can be mixed with water and sprayed onto the point being fertilized. Alternatively, they can be applied in granular solid form. Easy application is one of the keys to the success of the synthetic fertilizer industry.

During the 20th Century the global population, rose 500% from 1.6 billion to 6.1 billion. Agricultural production of the 20th century’s “Green Revolution” rose by about the same percentage, thereby postponing the Malthusian day of reckoning for most of us.[10] A significant part of the gains of the “Green Revolution” have been achieved through synthetic fertilisers made from hydrocarbons. "Modern agriculture” Professor Albert Bartlett once quipped, “ is the use of land to convert petroleum into food.”[11] As signs that the hydrocarbon era is ending become less deniable, synthetic fertilizers will become more expensive and less available, thus posing a threat to agriculture by existing methods.

So what are the alternatives?

One solution is to make synthetic fertilizers by current technology out of other feedstock other than hydrocarbons. Nitrogen for taken from the atmosphere as it is at present, can continue to be used indefinitely in the Haber-Bosch process. But hydrogen, presently supplied in natural gas, is more problematical. Hydrogen is available in virtually unlimited supply as one of the two constituents of water. But any process to separate H2O into hydrogen and oxygen is energy intensive. Since 75% of the world’s energy is currently supplied by fossil fuels, and with no convincing energy alternative in sight, the last thing the post-hydrocarbon world needs is a new industry that requires major supplies of energy.

If synthetic fertilizer is going to be too difficult to make, what are the other possibilities?

Opinions are divided on the answer to this question between those who deny the problem exists, those who think no solutions are available, and those who advance possible solutions. In the third category, ecologists such as Edward Goldsmith point out that modern versions of tradition agriculture from small farms using minimal fertilizers and with low energy inputs are already more productive than large scale corporate farms practicing monoculture.[12] From this it would follow that societies based on multi-cropping subsistence farmers, such as many in the third world, may well survive the coming energy crisis in better shape than those based on monoculture operations that rely on fertilizers, fuel for farm machinery, and still more fuel to transport products to distant markets.

Goldsmith and others also point out that the short-term gain of a Green Revolution based on synthetic fertilizers has come at a long term-cost of a depleted environment. Synthetic fertilizers damage the soil and wider environment in various ways, thus jeopardising agriculture of the future for the sake of high yields in the present. Goldsmith recommends today’s movement to large scale monocultural farms be reversed in favour of smaller mixed farms.

Regrettably for this viewpoint, the “small is beautiful” idea is not currently in vogue with the powerbrokers of the planet. In fact the proposed solution to future problems of agriculture proposed by Goldsmith undermines some of the most cherished beliefs of economics. It favours small over large. It favours non-specialisation of crops. It requires proper accounting for environmental cost. It argues for self-sufficiency. It argues against trade, in particular globalisation. Perhaps most significant of all, it diminishes the role of corporations in agriculture.

Countries like the US and Australia have made an enormous commitment to broad-acre farming of single crops based on application of hydrocarbon sourced products – synthetic fertilizers, insecticides and pesticides. The US and Australia are two countries that have shown themselves to bastions of denial on issues such as global warming. With its concomitant threat to its ideological beliefs of free markets, concentration of ownership and globalisation, fierce resistance by governments and vested interests to any paradigm shift in economics and agriculture can be expected.

Conclusion

The cornucopian fossil fuel bonanza is now in its closing stages. An economic system sustained by fossil fuels, can continue only as long as the fuels themselves last. To many, this is self-evident. That human life in today’s modern and complex society has become utterly dependent on hydrocarbon-based industries has been understood, at least at the scientific level, for many years. But others, including most of the planet’s powerbrokers, deny resources shortages exist. The global community while conscious of the increasing price of fuel for its motor cars, seems blissfully unaware of its wider dependence on fossil fuels. Communities in the first world, unlike in past ages, take it for granted they will have enough to eat. The notion food supplies may dry up through lack of fertilisers is not recognised in most first world dining rooms.

Society urgently needs to develop a plan to deal with this threat to food security and the other problems of giving up on fossil fuel dependence. It also needs to buy as much time as possible by making remaining supplies of fossil fuel last as long of possible. With the policy of growth economics prevailing worldwide, this is not happening. Under market-driven capitalist economics, maximising growth by maximising consumption is the principal economic objective. Resources are rarely considered in making economic and political decisions.

There was a time, back in the 1960s or 1970s when engineers considered wasting valuable resources by burning natural gas for space heating was almost a criminal activity. Natural gas was then, and is now, the essential feedstock for the petrochemical industry. It should, the argument ran, have been conserved for vital industries that keeps us alive.

The view the market is the only thing that matters, is sustained by economists with the proposition that future undefined, as yet undeveloped technologies will overcome resources shortages. It is theoretically true alternative energy sources and feedstock sources could be found for petrochemical and other fossil fuel dependent industries. But developing alternative methods of producing the essential products of modern life, in particular fertilizers, takes time, money, energy and expertise. The window of opportunity to develop these technologies narrows every day no action is taken. In an economic milieu obsessed with consumption, the future of fossil fuel-based industries, energy, fertilizers, plastics, insecticides and pharmaceuticals, is just one of many issues slipped under the carpet by the powerbrokers currently running the planet.

FOOTNOTES:
1. Deffeyes K.S., 2001, Hubbert’s Peak – the impending world oil shortage; Princeton University Press
2. Campbell C.J., 1997 The coming oil crisis; Multi-Science & Petroconsultants Perrodon A., J.H.Laherrère and C.J.Campbell, 1998, The world’s non-conventional oil and gas; Pet. Economist
3. Professor Albert Bartlett has written extensively on supply versus demand for coal and other energy sources. Refer “Arithmetic, Population and Energy”, http://www.hawaii/gov/dbedt/ert/symposium/bartlett/bartlett2.html
4. By mass of hydrocarbon material, about 60% of the demands of the plastics industry are for energy and the balance is for feedstock
5. Dove, Alan.“Experts Disagree Over Color of Biomass."Nature Biotechnology May 2000: 490.
6. Some 695.9 Million acres of corn growing land would be needed total cropland currently used in USA is about 395 Million from Professor David Pimentel - dp18@cornell.edu
7. Reducing Plastic Waste Tops 2001 Legislative Agenda http://www.becnet.org/ENews/01sp_plastic.html
8. http://www.vyh.fi/eng/environ/sustdev/indicat/pakkaus.htm
9. Lesser chemical elements such as phosphorous, sulphur and potassium and others are also important in fertilizing plants.
10. About 25% of the global population who are undernourished have already encountered their Malthus
11. Quote from Prof. Albert Bartlett (see 3)
12. Edward Goldsmith “How to feed people under a regime of climate change” http://www.culturechange.org/how_to_Goldsmith.html

Peter North – background: an engineer and with qualifications in economics and accountancy Peter’s early background was in the mining industry and later in the manufacturing industry. In recent years he has combined teaching finance and accounting with writing books, articles and papers combining technological, economic, environmental and political themes. Eight of Peter’s books have been published, with an additional book, “Culture Shock! Cambodia,” to be published in early 2005. This article is the copyright of the author and Pacific Ecologist. We are happy to allow reproduction of articles in Pacific Ecologist, on request to the author and Pacific Ecologist and provided credit is given to Pacific Ecologist as publisher’s of the original article.

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