Protect us from peak oil, says Richard Branson (and others)

In February, a group of business leaders (including Richard Branson) came together to issue the government a warning: we’ve had the credit crisis, the next crisis will be a peak oil crisis.

Their message to government was to stop listening to the over-exuberance of oil companies who promised great things from their upstream operations and start thinking seriously about how to move away from the UK’s dependence on oil.

Now they have repeated that call, with an additional warning: Macondo has made the situation even more pressing.

They are not saying that the oil lost from Macondo will make any serious dent in global supplies, but rather that the backlash against deepwater drilling could bring forward the crunch point when we run out of oil.

This is from their report, which is released today:

Our analysis of the effects of an average six-month delay to deepwater projects suggests a reduction in future spare capacity from three to two million barrels a day by 2015.

And this is what Branson himself says:

Our Government must take the problems around Peak Oil very seriously. This year’s Gulf of Mexico disaster has increased the chances of an “Oil Crunch” in the coming decade.

The obvious response from government will be, “Why should we listen to you?” One of the reasons is that one of the spokesmen for the group is Jeremy Leggett, chairman of Solarcentury, but also a government adviser on renewables. But even he admits, “Many people in DECC have said, ‘We have looked at your analysis and we simply don’t agree.’”

He also insists that his group are not making any recommendations on the regulation of the deepwater drilling industry. As he says:

We are not in the business of opining on blow out preventers.

In fact his group’s recommendations are not particularly tangible: they want a pan-industry consultation group on the matter, as well as more focus on a contingency plan for a peak oil age.

But their call for government not to listen too closely to oil companies is worth listening to.

The only problem is some politicians think that if anything, oil companies are not exuberant enough. Here’s the words of Lord Lawson, former energy secretary and noted climate change sceptic:

When I became secretary of state, BP and Shell came to me and said there is only 40 yrs of commercially available oil. That was 30 years ago. What do they say today? There is only 40 yrs of commercially available oil.

This report is likely to become another footnote in the great peak oil debate. But it is significant that these businesses are urging the kind of added impetus behind renewables that green campaigners have long been calling for. There is scope for an unlikely alliance there.

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