Monday, August 24, 2009

Future Watch: Mexican Peak Oil increases Illegal Immigration

Those who insist that relocating the entire population of poor people in Mexico to the United States is somehow good for us are going to soon get the chance to make their case, since the US has no real intention of stopping the deluge of illegal immigrants that cross our southern border (nor to deport the illegals that are already here). And, as an added bonus, those who follow Peak Oil will also get new data to work with.

Seeking Alpha
Mexico's Declining Oil Production: Clarion Call for Cantarell
August 23, 2009

The eighth largest oil field in the world will be dead by the end of next year. Shall I repeat that, or did you get it the first time?

...The days when you could find a supergiant oil field while fishing are over. Cantarell came late, in the oil age. That meant this global giant would receive all the best doctoring modern technology could provide. The result is that Cantarell was pumped out effectively and hard, especially after the technique to re-pressurize the field was adopted. This allowed for a spike high of daily production to be captured for several years, late in its life when a field would otherwise go into gentle decline. The result? Quicker monetization of the oil for the benefit of the Mexican state. But then the price: a catastrophic, fast crash...

...Chris Nelder, energy analyst and author of Profit from the Peak, also watches Mexico quite keenly and we both had an enormously long telephone call about Cantarell back in early January, of this year 2009. While we both have been tracking the decline of Mexico’s oil production for years, and knew that Cantarell was crashing, I was shocked when Chris said, “Oh yeah. That field could head below 500 thousand barrels a day (kb/day) by the end of this year.”

Now, one has to realize that this conversation was occurring just after New Year’s, and the most recently available data was for November, which had closed out just 5 weeks earlier. In that month, Cantarell produced 862 kb/day. In addition, Cantarell had started 2008 with January production of 1243 kb/day. Now let’s look at Cantarell’s production numbers for the most recent month of 2009, in July: 588 kb/day. As someone remarked on The Oil Drum, this looks to be a linear, rather than an exponential decline. Interesting observation. If Cantarell is indeed losing a steady 35 kb/day a month in production, then by Christmas of next year we’ll be close to zero...

...[Earlier forecasts that] the next oil crisis will unfold as Mexico loses the ability to export oil, [predicted this] starting sometime in late 2011. However, as so often is the case in this era of peak oil, that forecast now looks optimistic. Mexico will need all the oil they produce for their own economy. But to have an economy, Mexico will also need to solve the problem of another decline: the crash in oil revenues, upon which Mexico has depended for so many decades.

What this means for the United States has two main aspects. First of all, losing such a large percentage of barrels of world production per day will cause a permanent increase in oil prices - driving up not just the price of gasoline but also everything else made with petroleum derivatives (such as food from giant monoculture agribusiness farms). Second, a wave of illegal immigrants at least double what we are now enduring will make their way to the US, putting an incredible strain on our already overburdened healthcare, education, and utility systems.

Neither of these is good for the United States, but only one of them can be prevented: the influx of illegals. The question now becomes this: are we and our government going to get honest about the damage illegals are doing to our economic infrastructure?

Or are we going to persist in the obvious myth that unemployed and underemployed US Citizens can cough up enough tax dollars to subsidize the entire hemisphere of people made indigent by their own government's greed and/or incompetence?

Common sense, anyone? Please?

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