Mr Chairperson, Ladies and Gentlemen. On behalf of Andi and myself, I would like to thank you for the opportunity to address your forum and congratulate the newly elected and re-elected office bearers. Initially I will introduce the issue and implications of peak oil. Andi works for the Post Carbon Institute and will talk about two of their initiatives - the Oil Depletion Protocol and the Relocalization Network. To close I will introduce the relocalisation group Andi and I are establishing – Relocalisation Works in the Burnett Inland.

Andi and I are merely offering a very brief introduction to the issues and concepts here today. We’re both very keen to discuss the issues in greater detail with anyone who’s interested, you can either talk to us after the forum to make arrangements or Linda has our contact details. But for now, we’d ask that you hold questions and comments until the end of the presentation.

There are two questions we would like you to think about during our presentation.

1. Are the implications of peak oil significant enough that you, as a leader in your community, need to be informed?

2. Would relocalisation strategies benefit the Burnett Inland

(Activity re oil as lifeblood of modern society)

The Peak Oil refers to concerns raised by geologists and petro industry experts that global oil is about to reach it’s peak of production – after which point it will go into decline and oil will become ever more expensive. Each oil well and field follows a bell curve (Hubbert Curve) of extraction from the point of discovery to the eventual collapse. Up to the point of peak, the oil is relatively easy and cheap to extract.

Oil companies have, naturally, extracted the easier-to-reach, cheap oil first. The oil pumped first was on land, near the surface, under pressure, light and 'sweet' (meaning low sulfur content) and therefore easy and cheap to refine. The remaining oil, sometimes off shore, far from markets, in smaller fields, or of lesser quality, is more expensive to extract and refine. Under these conditions, the rate of extraction inevitably drops, the cost of accessing and refining increases.

When the data for individual wells or fields is collated, a picture develops for regional, national and global oil production.

‘Peak oil’ proponents commonly predict a peak of conventional oil production somewhere between now and 2030. Those predictions are based on a range of different factors and arguments. For me, the two most convincing arguments are that

1. World discovery of new oil peaked in the 1960s - the world is using more oil than it discovers.

2. Production in 33 of the world’s 48 most important oil-producing countries has already peaked and is in decline.

In addition to the supply side issues associated with peak oil, is the issue of rising demand. Until the 1970’s, the US was the world’s foremost oil exporter – now they are the world’s largest importer. 13 years ago, China was self sufficient in oil. Today they are the second largest importer. India is also a growing economy with a rising demand for oil.

Not only is oil expected to become more expensive to produce – but the greater demand and competition for it will drive prices up even higher. The crux of concern from the peak oil camp is not that we’re about to run out of oil – but that the era of cheap oil is over and we’re about to start living in a world where oil is increasingly more expensive.

The Qld treasury used modeling to examine the economic impacts of sustained high fuel prices on the state’s economy, concluding that continued high fuel prices would lead to a lowing of employment growth, declining trade and reduced spending. The committee suggested that rural and regional communities would be especially vulnerable to sustained high fuel costs.

So how likely is it to happen and what can we do about it? Australian state and federal governments are asking the same questions – as are governments around the world.

The ‘Impact of petrol pricing’ select committee tabled their report to the Qld parliament in April this year, recommending that Queensland needed a long term strategy to shock proof the economy from a future oil crisis. MP Andrew McNamara is currently heading an Oil Vulnerability Task Force researching the issue further.

The Federal Senate’s Rural and Regional Affairs and Transport Committee Inquiry into ‘Australia's future oil supply and alternative transport fuels’ interim report was tabled earlier this month. It concluded that the possibility of a peak of conventional oil production before 2030, even if it is no more than a possibility, should be a matter of concern. Exactly when it occurs (which is very uncertain) is not the important point. Australia should be planning for it now.

The US Dept of Energy commissioned a report in 2005 to explore how to mitigate the impact of global decline in oil. (not whether or not it would happen – but how to deal with it) Known as the Hirsch Report, it concluded that World production of conventional oil will reach a maximum and decline thereafter and without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary. Mitigation will require an intense effort over decades.

In a speech to the Qld Parliament Feb 2006 Andrew McNammara MP said "The challenges we face after Peak Oil will require localised food production and industry in a way not seen for 100 years ….. Self-contained communities living close to work, farms, services and schools will not be merely desirable; they will be essential.

So I ask you again to consider, are the implications of peak oil significant enough that you, as a leader in your community, need to be informed?