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Oil world in decline: despite ever-ingenious ways of extracting oil, world production might be past its peak. Will Colorado's economy benefit from a decline, or suffer? Q & A with state geologist Vincent Matthews.

Article Excerpt
Vincent Matthews was among the 275 people who attended a conference held in Denver last winter on the topic of the world reaching its peak in oil production. For Matthews, a former petroleum geologist who now directs the Colorado Geological Survey, the topic was not new, as his own research in the late 1990s led him to a similar conclusion: [??] The production of oil and gas that has been the foundation for the world's increasing prosperity during the last century will soon peak, if it has not already. [??] The repercussions of that simple proposition are broad, complex and powerful. [??] While some have branded the prediction as sky-is-falling environmentalism, it is not new.

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In 1956, American geologist M. King Hubbert predicted that oil production in the United States alone would peak in 1969. He was off by only a year. But even before that happened, he also predicted that world oil production would peak in about 2000. Some think we may have indeed peaked by now, although others more optimistically project another five, 10 or even 25 years of increasing production in the face of growing demand.

The peak-oil conference was co-sponsored by the Carbondale-based Community Office of Resource Efficiency, directed by Randy Udall, and the City of Denver. Denver's participation was driven by Mayor John Hickenlooper, a former petroleum geologist.

"Given the potentially powerful financial impact on the Denver area, we will need proactive responses and we'll need them soon," said Hickenlooper. But the most prominent speaker was Matthew R. Simmons, a Houston-based investment banker who specializes in the energy sector. An advisor to the administration of George W. Bush on energy, Simmons is also the author of a 2005 book, "Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy." Simmons has credibility, says Matthews.

But Matthews, who is officially Colorado's state geologist, also has credentials. First coming to Colorado in the 1960s to teach at the University of Northern Colorado, he jumped ship to Amoco in the 1970s to improve his salary--and was...