A Personal Journey Part IV: Twilight in the Desert

Matt Simmons – author of Twilight in the Desert
Matthew Simmons (1943 – 2010)

A Personal Journey

The second chapter of the book A New City of God: Theology in an Age of Limits describes my personal journey through Dante’s “Forest Dark”, in which I learned more about the changes that are taking place, and as I thought about the theological implications of such changes.

Dante’s Forest Dark

Dante’s Forest Dark

There have been various “aha” moments in my Age of Limits journey. Understanding Augustine’s City of God was one of them; reading Matt Simmons’ seminal book Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy was another.

Twilight in the Desert

Simmons was head of his own company; it specialized in financing oil and gas ventures. He was one of the first people to invest in the Gulf of Mexico. He was an integral part of the oil and gas community; he knew the energy business intimately.

In the early years of the 21st century Simmons became suspicious of the claims made by the Kingdom of Saudi Arabia (KSA) to do with the size of their oil reserves. Many nations hold on to this number as a closely guarded secret, particularly if their reserves are actually less than they claim. Telling the truth will reduce their political influence and power would decline.

To get around this secrecy Simmons spent many hours in the library of the Society of Petroleum Engineers (SPE) in Richardson, Texas. He read many, many papers to do with oil production in the KSA. Although most of these papers discussed only a narrow topic, he was able to piece together a bigger picture. His conclusion was that the reserves in the KSA were much less than generally accepted, and that the nation would soon be entering a period when oil production would decline. Hence the title of his book.

It is likely that Simmons over-stated his case. Nevertheless, his book changed the paradigms of “there will always be plenty of oil” and, “the Saudis can always pump more if they want to” to one of, “maybe there is a limit as to how much oil is out there”.

Following the publication of his book Simmons traveled extensively discussing Peak Oil issues. I attended an SPE meeting in Houston, Texas at which he was the speaker. There were about 50 people in the room — most of them engineers or project managers in the oil and gas business. The audience gave him a polite but rather frosty reception.

Before the meeting I spoke to Simmons briefly; I pushed back on some of his arguments. Our discussion was not entirely amicable. He died not long after that meeting. I wish now that I had shaken his hand and told him how much I appreciated what he had done. But it is too late now.

The lessons that I derived from his work were,

  • Oil (and by implication any other natural resource) is a finite resource. Once it is gone, it is gone.
  • The truth about what resources are available can be difficult to ascertain because many nations and businesses want to keep that information confidential and/or mislead us. It is also possible that they themselves may not understand the size of their reserves.
  • Extrapolations that assume that the future is simply a linear continuation of the past can be highly misleading, or just plain, flat-out wrong. This is the linearity trap. With reference to oil, production from a particular field will climb steeply, then reach a peak, after which production declines, but probably at a lower rate than the initial climb.

Toward the end of his life, Simmons’ credibility was hurt by some of the preposterous claims he made to do with the Macondo spill. Furthermore, his predictions to do with the price of oil reaching $500 per barrel were completely wide of the mark.

Although his predications often turned out to be badly wrong, Simmons does teach us two important lessons.

The first lesson is that it is important to study a topic in depth and to do one’s homework before stating an opinion on that topic. The Saudi government was not willing to release auditable data regarding oil production (they still don’t). So Simmons carried out the tedious spade work of reading through a large number of SPE papers to try and find the truth. He did his homework.

The second lesson is that he was courageous. He must, at times, have felt like the prisoner in Plato’s Cave. When the prisoner returns from his journey to the world outside the cave and tells the other prisoners about what he saw and experienced, they want to attack him; they don’t want to face reality. He faced an almost endless stream of criticism for the data and opinions that he presented.

Author: Ian Sutton

Ian Sutton is a chemical engineer who has worked in the chemical, refining and offshore oil and gas industries. He is the author of many books, ebooks and videos.

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