uranium fundmntls - peak oil/global warming

Bringing the discussion back to longer term fundamentals of BMN, I watched a very interesting documentary on the origins of oil today, how it has seeped into every aspect of our every day lives, the issue of peak oil and global warming etc. These are obviously well debated topics. What struck me was the relevance of all of these issues to BMNs fundamentals - they were very encouraging to me and in my view underpin BMN's potential into the future as one of the few big viable deposits at an advanced stage moving rapidly toward building a mine and bring on line new production.

As was rightly pointed out in this documentary, from the moment we enter the world from the latex gloves worn by the doctor who delivers us, the sterile hospital we (hopefully) arrive into, the car or ambulance that got us there etc "we are bathed in oil" (plastics to paints to pesticides, pain killers, polyester etc - there is a drop of oil in almost everything we touch, use, consume). Oil is everywhere. Oil as an input into production has become an almost indepensible component in the production / supply of almost every consumable on our supermarket shelves. It is estimated that every American accounts for 3 gallons of oil every day - whether directly as fuel in their car or through the goods they consume. The statistics at an aggregate level were somewhat startling and more than a little compelling to me - 4.5 cubic kilometres of oil are consumed per year. Every day over 84 million barrels of oil are transported and used (this is expected to rise to well over 110 - 120 million barrels per day in 10 - 15 years time). Question, is there sufficient supply/production to meet this. Demand could only be described as insatiable. Now, perhaps we don't run out of oil completely for another few decades but you can be sure, almost certain that the price of oil will rise many fold from where is currently sits today if and when it becomes more widely recognised that global oil reserves are under such severe pressure. This of itself will force us to uranium and other alternatives as fast as possible.

There is obviously considerable debate and disagreement over when peak oil has or will come. Though there seemed to be some level of consensus in this particular documentary that 2008 is about the year plus or minus two years. Others would have it as having passed far earlier whilst some other industry players and some analysts seem to either see it as coming at some unknown point into the future or decry the concept altogether citing the advent of new technologies lessening demand, unconventional sources of oil (like the oil sands) and new discoveries as reasons for their view. Hubbert, a well respected expert in the oil industry, predicted oil production peaked in the year 2000. It is difficult to ignore altogether the thoughts of people with his credentials.

From all that I have read, my personal view is in the camp that the end of oil is certainly coming as we know it today and most likely faster than many would think or like and the world at large needs viable alternatives. It seems abundantly clear to me that the reality is that the world is now and will remain for some time dependant on rapidly shrinking supplies of oil and it will be the shock of this realisation as it plays out in the coming decade(s) that will see an urgent and paradigm shift towards alternative sources of energy - my expectation is (and I believe the early signs are there for all to see) that nuclear energy and all its various inputs will be a big part of that realisation and shift.

The double edge of course to all the massive oil consumption over the past 100 year is that we are at the same time pushing CO2 back into the atmosphere which is where the green house issues flow from. C02 concentrations in the atmosphere are critical to the planets eco equilibrium. No one is really clear on where the precise trigger is that will make for the point of no return on global warming. As some scientists would have it we are pushing the planet back towards the very state in which the oil was formed in the first instance. I haven't really got time to go into the details of precisely what that means - but suffice to say it doesn't mean that the whole planet becomes like club med more like a world of poisonous oceans. One rather large hydrogen sulphide bath. For an unscientific mind such as mine the logic as it was explained was fairly easy to follow compelling. That all being true there is some serious irony in that which we should all be aware of.

Two key messages:

1. Cheap energy is on the way out.

2. Collectively, as a planet, we are on the verge of something pretty unsavoury in terms of climate change.

Anyway - worth a look, it really left me with a lingering sense of urgency and all in all reinforced my views that the industry fundamentals underpinning BMN as a company into the next few years are as sound as ever.

http://www.abc.net.au/science/crude/