Matt Simmons, energy investment banker, founder and chairman of Simmons & Company International, passed away recently. He was well known and respected for his study of the energy field and will be missed. Matt Simmons, Chairman of the Association for the Study of Peak Oil-USA (ASPO-USA) Advisory Board was well known for his controversial work, Twilight in The Desert, and his views on peak oil production.
I interviewed Matt Simmons for the TV program we produced in July of 2006 about his work and his concerns with the lack of availability of transparent data with respect to oil and gas reserves. On the program, a 2008 Telly Award Winner, our guests included:
Matt Simmons expressed his concerns about peak oil production and about how few experts truly understand what this means. He said,
“Peak oil is not about running out of oil. It’s about the supply peaking. And the problem with oil peaking is that once it does, you’ll start down the other side, we may still have a lot of oil, but there will be quite a gap.”
Peak Oil: Are We There Yet? Part One and Two, are well worth watching. Matt Simmons shares some of the views from Twilight in the Desert, in which he summarized what he learned about Saudi Arabian oil production by reading 200 academic papers; visiting Saudi Arabia and asking questions which concerned Saudi oil production. He concluded that the oil extraction techniques being used in Saudi were techniques that one might use if the fields were depleted. Based on his findings, he questioned Saudi claims that their oil production can be greatly expanded. According to Matt Simmons, the very real possibility existed that in the not too distant future, Saudi oil production will suddenly decline. His concern as well was that knowing what oil reserves actually are is difficult when oil reserves and oil production rates are not audited.
He believed we have to trust but also verify; that we hear about the supposedly huge reported reserves of Saudi Arabia and other Middle Eastern countries, and assume that this oil is readily available for extraction. Since these reports are not audited, we cannot depend on them. He pointed out that we do not have detailed data with respect to historical oil extraction from individual fields in the Middle East, consequently we can’t know how close to decline Saudi Arabia and other Middle Eastern countries may or may not be.
We salute Matt Simmons for the work he did and his contribution to the field. He raised questions and concerns about our complacency on this critical issue and stimulated much needed discussion and further exploration.
As always thank you for joining us, as we talk about things that matter with people who care.