Sunday, December 5, 2010

The New Wealth

Come on folks, have a little fun with the TSA!  Pull a "When Harry met Sally" restaurant scene (Meg Ryan shows how to fake the big "O") when the TSA does their dirty work.

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I read with interest the comments to my post "Ok, you've made your point".  

Life will go on after Oil. The pursuit of wealth will go on, as well. We will always compete for what it is we truly desire most (and we all know, in our heart of hearts, what that is)... no amount of grey-haired pony tails claiming a tye-dyed uniformed worker's paradise is going to change that... and wealth will NOT be defined as a tenement apartment in a city.

Maybe wealth will be defined by gold... but I doubt that, too.  Wealth will be defined as the "means of production" that has always defined it... and nothing "produces" stuff quite like land. Timber, crops, livestock products... these things cannot be produced in a city apartment or suburban home.

The massive cities of today have one tremendous liability - sanitation.  The waste produced by 8 million people is truly of a volume of mind boggling proportions.  Concentrating populations in small areas that will need heat, cooking fuels, a means of making a living, and sanitation with severely constrained energy inputs leaves much to be desired.  Its all about energy inputs - if nuclear, solar, wind, ethanol, etc... can produce consumable energy in amounts sufficient to run any given closed system, then this is not an issue... if not, the outcomes are not terribly appealing.

Of course, the U.S. wastes electricity like we do potable water... and that makes for a great deal of slack within the system... but only for a very short period of time, say a decade - and then one must think about the economic effects of curtailing electricity consumption (and that is a very significant consequence).

No, mega-cities like New York, Chicago, Sao Paulo et al simply could not exist in a severely energy constrained environment... how that unwinds and over what time frame with what unintended consequences... well, your guess is as good as mine.

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Much has been said about "Shale Gas" and "Fracking".  I have read most of it.  As in all things, it seems to be nothing short of "Sex, Lies, and Videotape".  So I go back to the numbers.  The largest Shale contributor to U.S. Nat Gas production is the Barnett formation.  It produces a whopping 6% of the Nat Gas produced in the lower 48.... or about half what the U.S. imports from Canada every year... and to get that 6% required about 20% of the drilling equipment by capital investment. 

The Haynesville play has got to be the biggest disappointment yet in Shale Gas given the hype that surrounded it.  Last year, Haynesville was going to save the U.S. from imported Oil... now, those companies with the largest exposure to Haynesville are moving rigs elsewhere....  Haynesville might make sense at $15 mmf Nat Gas, but it is suicide at $4.25.

Mayb, MAYBE, the Shale Gas extractions can overcome the decline in conventional gas plays for a  couple of years... but no more (and maybe not).  The media onslaught and propaganda from "Big Gas" has convinced the futures market that Nat Gas will never rise again and if we give these guys all of the capital and permitting they request they can save us from $200 Oil with their Shale Gas production - my bet is that the market has been fooled along with the public.

This is not a recommendation to buy Nat Gas futures... Nat Gas is THE MOST VOLATILE FUTURES CONTRACT on the board, and has been nicknamed "The Widow Maker" by futures traders with very, very good reason.

Meanwhile, back at the Oil Ranch....

I look forward to monday's action in the crude futures market like it was "Super Sunday".  This could be one of those moments of truth, or nothing more than just another lie in the markets.

12 comments:

Stephen B. said...

Whether cities continue to work or not seems to me, to be a function of size, among other things. (I know, Duh.) A truly large city, geographically, and with regards to population size, just won't work as you point out. The food just has to come from too far, the waste has to be carried too far. Now some would say that cities can grow some food within the city and massively recycle, and to a degree that is true of a rather diffuse city, but that only will work, if at all, in a fairly warm location where composting and food production can go on more or less year round (I'm thinking of all that I've read and heard about Havana, post-USSR oil.)

Here in eastern MA, in some ways, Boston could work a bit like it used to 100 years ago IF we still had farms much of anywhere in the area, but we don't. For some reason, Boston has much less working farm land left around it, say within 100 miles of it, than does even Newark, NYC, Philadelphia, Chicago, Pittsburgh, etc, etc. Just looking at online satellite composite photos proves this. It may be that the soil in eastern MA is worse than it is surrounding those other metropolises. It's interesting to note, however, that one of MA's most prosperous, non-agricultural counties, Middlesex County, was a top-ten US county in terms of $ AG production as late as 1918, sorry soil or not. In any case, Boston didn't really grow "large" until railroads were developed in the mid 1800s to bring food and other ag products to the city. Then it took off, so I suppose that since most all of those RRs are still in place, some of the old commerce flows could be recreated. Still, Boston cannot move the goods in or out on a scale that would allow the present population and density to continue me thinks. (Long term, I just don't see roads moving stuff long distance any more as I think cheap pavement, available in the copious amounts we require just to keep ahead of road decay, won't be available in the future. I don't think semi trailer units will run well on batteries, $12 diesel, natural gas, if the latter two are even available at all.)

continued....

Stephen B. said...

continued from above...

Boston's main water system is gravity driven happily, though there are powerful, electrically driven pumping stations to boost pressure to some higher places in the city and the inner suburbs. Most of the waste flows by gravity to a large sewage treatment plant on an island in Boston Harbor, though there are vital sewage pumping stations throughout eastern MA that pump effluent up hill, out of low lying neighborhoods to get to the gravity mains. (Come to think of it, sewage probably depends on these scattered pumping stations more than the potable water does. but still gravity does a good deal of the transport. Too bad for the neighborhoods in holes.) Once it gets to Deer Island, however, truly huge amounts of electricity run the sewage treatment plant itself, the digesters, the settling tanks, aerators, and so on. Failing that, the plant defaults to dumping the sewage raw into the ocean, which might be what happens in the future, unfortunately.

Cities that require power for water pumping (some aqueduct systems in the West come to mind) might be SOOL. Cities increasingly dependent on desalinization plants....??? Ah, Hahahahahah! (Sorry.)

Where we draw the line on population? 50,000? 500,000? It depends on climate, topography, and a bunch of other factors. Some cities of half a million might still work in some places. In others (Las Vegas???) I'd imagine even 100K would be a real stretch.

westexas said...

Good NYT article on the problems facing local & state governments in the US:

http://www.nytimes.com/2010/12/05/us/politics/05states.html?_r=1&hp
Mounting State Debts Stoke Fears of a Looming Crisis

Anonymous said...

The issue of human waste in cities makes me think of the honey bucket man, an east Asian icon, who came around and emptied the toilets in the extremely densely populated section of Seoul, South Korea where I had an off post room in 1971. No vehicle, just two open buckets and a yoke. You squeezed against the wall to let him pass in the narrow alleys. All headed for the rice fields.
Or ten story walkup housing blocks with one water tap and toilet in the hall on each floor and no central heating.
Americans just don't remember.
Humans can be pretty adaptable when they have to.
Rational Liberal

Greg T. Jeffers said...

Stephan, to my mind it is ALL about waste...

Rational: In 1971 Seoul was not a mega city... and yes, humans can adapt. So can cholera, disentry , typhoid, etl al...

Outbreaks of disease due to a lack of sanitation was very much the norm in pre-industrial Europe, and I would argue THE limiting factor in city size...

but I could be wrong... maybe Americans WILL adapt to hauling tons of "night soil" and after a dozen generation of natural selection have become inured to these diseases.

Bill said...

Thank goodness for septic tanks. I just have to have enough water to flush.

Greg T. Jeffers said...

Bill:

We are putting a raised bed vegetable garden on top of the leach field for our septic system... talk about recycling...

Corn, potatoes, and beans will stay where they are - adjacent to the hog yard so that we can let them out at the end of the season and clean up... over time one develops systems that work best with what ya got... I think...

Dan said...

Septic tanks need to be inspected every year or so. Just pick a day, skip breakfast, open the top and slowly plunge a stick in until it hits bottom. Then pull it out and look at how deep the sludge is in relation to the depth of the tank. When it’s about half full of sludge it needs pumped or the sludge will clog the leach field. I reckon the sludge is very rich in fertilizer, but personally, I’d just hire a honeypot truck to haul it off.

Bill said...

We have almost 400 ft. of 4ft. wide piping out of our tank. There's a lot of room for it to flow so I'm not too worried about it. Anything could happen but it's engineered pretty good for a regular family.

Dan said...

Doesn’t matter how well the septic system is designed, the leach field is only designed to handle liquids, solids collect in the tank and need to be pumped. A good system used by a single family will probably only need to be pumped once or twice a decade but it will still need to be pumped. There are three ways to find out if it needs to be bumped.
A. Inspect it.
B. pays someone to inspect it.
C. Wait until your septic tank starts leaking at which point your leach field is clogged and needs to be dug up and replaced.

When your septic tank starts overflowing it’s C. it is a preventative maintenance issue, sort of like changing the oil in your car. Doesn’t matter how well the car is built, if you don’t change the oil it won’t last long.

Anonymous said...

We get our pumped every other year, never heard of people waiting 5 years, unless you have a huge tank, multiple 1k gal tanks, or the 'family' is 1-2 people only.

I usually don't wait more than 1 1/2 year, better safe than sorry--since having the bed go bad, usually costs thousands, and in most areas if your tank/bed is old and you fix it, it means you have to upgrade it to the newest code and pay EPA tax of 1k+.

-Meiyo

Anonymous said...

Miloganite!