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The Response to Twilight in the Desert
by Matthew Simmons
So far, the praise for Twilight in the Desert has outstripped the negative
comments by about 50 to one! This has been a pleasant surprise.
I have now received hundreds of letters, e-mails and calls from people who
have finished reading my book. Scores of these comments have come from some
of the top oil and gas technical experts in the world, and a surprising number
of CEOs from the leading independent exploration and production companies have
sent me cartons of books to sign so they could distribute copies to their board
members and other senior managers. The most common praise the book has received
has been for its thoroughness, for the clarity with which complex reservoir
management issues were discussed and for its ease of reading.
However, not all of the feedback has been supportive of my thesis. The handful
of critics who have surfaced so far have questioned the book’s accuracy
on several fronts. I will summarize the key issues critics have raised.
First, a number of oil analysts and consultants who state that they have carefully
reviewed the data that Saudi Arabia’s oil ministry and Saudi Aramco have
released believe it is accurate or even conservative. Some argue that the proven
reserves may even be understated. Others argue that it will be easy for Aramco
to grow its production to 15 million per day and keep it at these levels for
50 or even another 100 years. But none of these people offers any evidence
why this should be so. They all seem to base their optimism on the summary
statements and information provided by Saudi Aramco.
Unless these optimists have access to secret data verifying the Saudi claims,
they obviously must buy into the "trust me" theory. In fact, it is
likely that some of the book’s most vocal critics may do consulting work
for Saudi Aramco, though none has disclosed any client relationships that might
slant their opinions.
Regardless of the questionable merits of some of the few who have taken the
time to refute my data, I commend those who have spelled out why they disagree
with my conclusions. In particular, I appreciate one critic who emailed me
his detailed review as a professional courtesy before I heard that he was taking
issue with the book.
It also has surprised me that the two months or so since Twilight in the Desert
was published have seen a complete lack of reaction, positive or negative,
from three groups:
- First are the energy economists who have staked so much on their
belief that peak oil is "junk science" and that oil prices will
soon return to their normal low levels, espousing the view that high prices
and new technology always make adding new supplies easy and cheap.
- The
second group is the senior executives of our major oil companies. Perhaps
all are too busy to read the book but none has, to my knowledge, commented
publicly on my thesis. I have lots of feedback from VP-level personnel
at major oil companies, and virtually everyone I see or hear from says, "We
are all banking on you being 100 percent correct."
- And the third
group that has been mute since the book first showed up in bookstores:
senior or middle-level oil executives at Saudi Aramco. From my limited
knowledge, it sounds like the senior oil ranks within Saudi Arabia
have shut their minds to all the unforeseen consequences if it turns out
that my thesis is half right or even 25 percent correct.
All in all, I am extremely pleased at the early reaction to Twilight in the
Desert. I spent two and a half years analyzing all the data that went into
it and then trying to write the material in an easily understandable yet technically
accurate manner. I did this not to sell a few books but hopefully to transmit
a wake-up call that the world has built a questionable economic plan that envisions
unlimited amounts of cheap Middle East oil for as long as any supply/demand
models have projected.
Finally, to the critics who say that an investment banker doesn’t have
the technical expertise to understand SPE papers, I have two responses. First:
I did my homework as best I could. Second: I had extensive conversations with
some of the finest reservoir and geological experts in the world. All the material
was reviewed before publication not only by many people with exactly the right
expertise but also by people who had personal knowledge of the Saudi Arabian
reservoirs about which I was writing. To them all, I express my deepest gratitude,
because they made sure that this investment banker didn’t make a fool
of himself!
Matthew Simmons is the chairman and CEO of Simmons & Co. International
and the author of Twilight in the Desert: The Coming Saudi Oil Shock and the
World Economy. |
