All posts by Richard Ha

Health, Peak Oil

Me & T. Boone Pickens

While I was doing my exercises this evening, I thought about listening to T. Boone Pickens at the Association for the Study of Peak Oil & Gas (ASPO) conference I attended in Houston last month.

Peak Oil refers to the point where the total amount of oil extracted in the world starts to decline, for geological reasons. At that point there are still lots of reserves left, but it has become increasingly difficult to retrieve it. Here’s an up-to-date and unbiased overview of where things stand right now.

Pickens said the world cannot produce more than 85 million barrels per day (which was reached in 2005) yet present world demand is 87 – 88 million barrels of oil per day. By 2030, 22 years from now, total oil supplies will decline to 50 million barrels per day. That’s 35 million barrels less than is produced now.

Supply and demand being what it is, we can expect higher prices. How high? No one really knows. That whole subject is difficult to wrap one’s brain around.

T. Boone Pickens also said he was a great believer in exercise. I liked him right off. He related that many years ago his company (Mesa Oil) was one of the first companies to require that its employees take an exercise break.

He told us that even now, at 79 years of age, he still walks 40 minutes at 4 mph several times per week. I considered interrupting his talk and asking him at what heart rate, but decided not to. Now I regret that I didn’t. He was obviously the kind of guy who would know the answer. And I was truly curious.

Back in the Feeling Good post of April 23rd, I related the results of the treadmill test I’d taken a few days earlier. The test consisted of four three-minute intervals. By the last three minutes, which were set at 4.4 mph, I had reached a heart rate of 172-174 and had stabilized. I stopped at 2 minutes and 40 seconds.

I use that three minutes at 4.4 mph as a goal. I did 2 minutes 30 seconds yesterday. But I am also doing short bursts at 6 and 7 mph.

Although T. Boone Pickens is 6’2” or so and maybe he is just walking fast, still, 40 minutes at 4 mph is pretty good for someone who is 79 years old. I have to step it up.

Peak Oil

Matson Fuel Surcharge Increasing

In today’s business section of the Hawaii Tribune-Herald, the article “More to Ship” announces that “Matson is hiking surcharge further.”

Last month, Matson announced that on December 2 it was raising its fuel surcharge from 24 percent to 26 percent. But due to rising oil prices, Matson now says it will instead raise the fuel surcharge to 29 percent on December 14.

This is the single largest fuel surcharge hike since 1999. And the article says that the company may consider another rate increase in Jaunary if fuel prices stay at the same levels—which I think they will.

The article goes on to say that a 20-pound bag of rice will cost 3.9 cents more, a head of lettuce one cent more and an 8 ft. 2X4 will cost 2.7 cents more. This gives the impression that the surcharge is only a minor cost increase.

But Paul Brewbaker, Senior Vice President at Bank of Hawaii, added some perspective to the discussion. He said, “The cost of oil has gone up from $50 to nearly $100 per barrel over the last year….It’s too simple to say that the fuel surcharge will lead to higher prices at the supermarket…It may be more expensive to transport lumber, but it may also be that lumber is more expensive.”

I’m glad he mentioned that. We grow lettuce and we know that the cost of bringing a head of lettuce to the local supermarket is affected by oil prices from the very beginning to the very end. Fertilizer, cultivation, chemical, irrigation, cooling, packaging and transportation all uses, or is made from, oil.

For example, lettuce must be grown to get seeds. So as oil prices rise, seed costs rise. Similarly, the cost to grow that head of lettuce will rise with escalating oil prices. Costs all along the way, such as of cooling the lettuce and hauling it by truck to the docks, are influenced by rising oil costs.

The Matson transportation to Hawai‘i may cost only one cent more per head of lettuce. But hauling that head of lettuce from the dock to the wholesaler’s cooler, and further hauling to the store, all cost more as oil prices rise. Then the store lights and refrigeration costs go up as oil prices rise, too.

So as Paul Brewbaker points out, “It’s too simple to say that the fuel surcharge will lead to higher prices at the supermarket.” Lots of these costs take a little time to work their way through the system. But they will.

That’s what I was talking about when I wrote the blog post Frog in the Pot.

Community, Education, Hydroponics, Schools

Nawahiokalaniopu‘u

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Jimmy Naniole, of Nawahiokalaniopu‘u, the Hawaiian language immersion school in Kea‘au, brought some teachers for a tour of our farm the other day, so they could see firsthand what we do and how our farm operates.

We’re going to help Nawahi set up a hydroponic operation. We’ll provide help and assistance as needed, and if we can contribute used but functional equipment and supplies, we’ll do that. We like for youngsters to learn how to grow things.

When the Nawahi teachers were here, Kimo gave an orientation and told them why we do what we do. So now they have a good sense of what their plants will look like as they start producing a crop.

The teachers included Na‘ilima Gaison, Lei Franco, Poha Tolentino-Perry, Loke Rosequo and Pele Harmon.

 

Last week Jimmy took me on a tour of the Nawahi school grounds. I was last there maybe 10 years ago, when Jimmy was turning the outside area into a sustainable, organic operation. He was raising animals and plants and integrating them into the landscape. Water flowed from the roof of the school by a series of pipes above and underground, through a lo‘i (taro patch) and into a low spot, a pond. It was a real Hawaiian-style landscape.

At that time, Kimo took Jimmy some banana pulapula and now all of the bananas on the school ground are from those original plants.

Jimmy has retired since then, but the school has “called him back” to help with its nutrition program.

We’ve known Jimmy from his days at Hilo High School. One of his students at Hilo High was Henry Lovell, who is now our tomato field operation superviser.

When Jimmy was at Hilo High School, he taught by doing things in the old ways. He had students growing traditional plants, such as kalo and ‘uala, and even made an imu where the kids learned about roasting meat.

During that period, the Hokule‘a sailed from Radio Bay in Hilo to Rapa Nui, and Jimmy asked me if I could supply bananas for the journey. He pointed out that in just a few days the voyagers would be out of fresh fruit. So I set out to make the bananas last as long as possible by varying the maturity and variety we provided. We were happy to learn that the crew ate the last bananas as they crossed the equator.

We are happy to be working with Nawahi. The Hawaiians of old had a society that functioned well, and where trading and taking care of each other was part of the culture—and this is something that Nawahi teaches.

They are important lessons. We believe that as oil supplies decline and food prices continue to rise, people will need to grow more of their own food and trade with each other. As we move into a new era of alternate energy, and out of the “Era of Oil,” these are some of the things that we must again learn how to do.

This is why we are so pleased to be working with Jimmy again and with Nawahi.

Peak Oil, Travel

Houston

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Every year we try to visit the Produce Marketing Association (PMA) tradeshow in Houston. This year I almost stayed home with June to help with Vovo, her mother, who is ill. But the Association for the Study of Peak Oil (ASPO) conference was taking place immediately after the PMA show, also in Houston, so I decided to go.

I didn’t expect it, but my son Brian told me that he, his wife Kris and their 15-month-old son Gunner would drive down from Fort Hood to hang out with me for a few days.

As it turned out, that was the highlight of the trip. I got to hang out with my only son, my favorite daughter-in-law Kris and my buddy Gunner. We went to visit the Central Market, a Whole Foods-like store, a children’s museum and the Houston Aquarium.

Outside of the Aquarium, a lady gave a little talk about a giant owl. This owl was huge and bad and he did not say “HOO.” When he said something, he said, “MAAAK!”

I told Gunner, “Gunner, owl! Maaak!!” One day, some teacher is going to have to undo that and teach him that an “owl goes hooo!” But Gunner will know that Papa calls it like it is.

 

Funny thing—I was walking toward the Galleria in Houston when a car drove by and a guy yelled and gave me the shaka sign. “Eh, howzit,” I yelled back. It was Young Tarring, who lives and grows apple bananas in Kea‘au. His dad Mike and I have been friends for more than 20 years. What’s the chance of running into someone from Hilo in Houston?

He is promoting Hawaiian-grown apple bananas on the mainland and has a really attractive product. He was at the Hawai‘i Dept of Ag booth.

The first time Clay visited Hawai‘i he was anxious to learn about the culture and pronounce words right, so I gave him a test. I said, “I’ll spell it and you say it.” I spelled “Komohana” and he pronounced it, “koh moh ha nah.” I spelled “Kalakaua,” and he said, “kah lah ka oo ah.” I was impressed. I spelled Pi-pe-li-ne and he said “pee pay lee nay.” I told him, “My friends pronounce it ‘pipeline.’” We both laughed out loud and we’ve been buddies ever since.

Clay, Steve West, (not pictured) who owns an agricultural consultant firm in Yuma, and me are friends from way back. Steve and I went to San Jose, Costa Rica for a world banana conference many years ago when we were both starting out in our businesses. Steve has since consulted extensively throughout Central and South America.

Every year at the PMA show I get to say hello to Cris West, former Director of Grower Development with Friedas and now with Euro Fresh, coordinating and sourcing from Mexico. She is the sister of my good friend Steve West.

The PMA show is always special because I get to visit friends. It was nice to see Clay and Cris. Maybe next year I’ll see Steve and Lee as well.

The ASPO conference was really intense; it ran from 8 a.m. to 9 p.m. Wednesday though Friday, and until noon on Saturday. There were a lot of rich investors in attendance. I thought to myself, “No wonder they are rich.” They are rich because they are on the cutting edge.

I met Gail Tverberg there, who is a very thoughtful commentator on the subject of world oil supplies. She posts at The Oil Drum under the name “gailtheactuary.” Her business assesses insurance risks.

The Houston Ship Channel is five or six times the width of the Wailoa River, and maybe 20 times as long. Add in all the industrial buildings and fuel tanks of HELCO, plus all the fuel tanks and industrial buildings of the Hilo wharf area, then multiply that times one or two thousand and you get the Houston Ship Channel. It’s the oil capital of the U.S.

I sat in on every conference session and by the end it felt like I had taken a graduate course in oil and gas. It was one of the most important conferences of my life. The subject matter is very grim, but you cannot grit your teeth all day long. No matter how grim things get, we need to find any excuse to laugh. That’s why it was so great to see my kids and grandson and friends, old and new, during this conference.

Government

Farm Bill

I just read an interesting opinion article by Mladen Golubic. It begins:

As a medical resident working in one of the poorest cities in the country, I see firsthand how poverty can contribute to poor health.

The hospital where I work is filled with people suffering from uncontrolled diabetes, high blood pressure, and other problems often exacerbated by a lack of health insurance or income. These problems and their origins are complex, of course. And millions of words have been written about how to fix them. But there is one thing the government could do right now that would make a tremendous difference to my patients and to all the nation’s poor: Reform the Farm Bill currently up for reauthorization in Congress.

Currently, he explains, “this subsidy system rewards farmers for growing foods that contribute to high blood pressure, heart disease, diabetes, and other diet-related diseases I treat every day. Wouldn’t our taxes be more wisely spent promoting healthier foods such as fruits and vegetables?”

It’s an interesting topic because there has been very little in previous Farm Bills that benefit fruit and vegetable producers.

But if the present Farm Bill were to benefit the Women, Infant and Children, Seniors and Food Stamp program recipients by providing fruits and vegetables, this would be a good thing for the recipients. And it would be positive for local farmers. All in all, a good thing.

Food Security, Peak Oil, Sustainability

Food Is More Important Than Oil

At the ASPO conference I just attended, it was projected that the peak of the world’s oil production (after which time, demand will exceed supply and prices will rise sharply) may occur in 2011 or so. As do some others, though, I think the peak may have already taken place. This article, entitled Our World Is Finite: The Implications of Resource Limitations, is bleak.

A graph in this article projects a permanent decline in the United States’ gross domestic product because of limitations on oil and natural gas. This assumes it would not, at that point, be “business as usual.”

At the conference, I met Gail Tverberg, who wrote that article. She is a very soft-spoken and thoughtful person. She made this complex subject easy to understand.

I mentioned to her the connection between oil and food and she included it in this morning’s post. She wrote to me yesterday saying that, in some ways, food is more important than oil. RIGHT! No more food, no more people.

We are incredibly fortunate to live in Hawai‘i, where the sun shines all year long. In the old days, the sun provided 100 percent of the energy we needed to grow our food. Cheap oil has camouflaged that. But as oil prices rise, sunshine is still free.

Farmers can use some help in developing alternate energy sources to help them with their work. The Hawai‘i Farm Bureau has included in its legislative package a new Department of Ag farm loan program that gives them this help.

Farmers cannot wait for public utilities to bring down energy costs. I trust individual farmers more to do what they need to do. Think small-scale bio diesel. There are other ways as well—things like windmills, hydroelectric, solar, etc.

The more one farmer can produce, the more vibrant our society will be post-oil decline. We do not want to go back to where everyone has to fish, or farm, to feed their family. It all has to do with how much help a farmer can get from alternate energy to help him with production.

Our challenge now is to see how we can get Hawai‘i farmers to grow more food for our people. As imported food prices rise, I believe that local farming will become more profitable. That, and the proliferation of farmers markets, will make farming profitable.

I am very aware of the Cuba and North Korea models. Both were dependent on oil supplies from the former Soviet Union. When it collapsed, they had to fend for themselves. As a result, North Korea has widespread famine and crop failures, while Cuba has survived quite well. I think that the basic difference is that Cuba has more energy from sunshine than North Korea. Still, I think that we can improve on the Cuba model.

I believe that we should send a hopeful message that although oil is becoming more scarce, and prices of our imported food are rising, there are things that we can do. Such as:

• Landscape with plants that make food. Garden where possible and plant fruit trees, etc. ‘Ulu trees come to mind, because they provide an abundant supply of a tasty starch food.

• I think houses should have waste water lines plumbed in, so people can reuse the water for gardens. Then farmers will produce for people who cannot grow food themselves.

• People need to start thinking about getting to know their neighbors, plan what they can trade, and get closer to their families. Kids can have chores taking care of the plants. This is not a bad thing. We kids in my family fed the chickens before we went to school.

No problem; we can do this.

The Sustainability 2050 project that the state of Hawai‘i is preparing right now will be very valuable. But it needs to include Five Year Plans, because things are moving fast. The sustainability council also needs a strong Ag person on the council.

And food should be the top priority. We need to do an assessment of the number and composition of calories necessary to maintain a population of 1.5 million. Andrew Hashimoto, Dean of the University of Hawai‘i College of Tropical Agriculture and Human Resources, mentioned something like 2 billion calories per year. We should compare this number of needed calories to what we are able to provide now—how many calories’ worth of food we grow in Hawai‘i now—from the point of view of human nutrition. This will give us a road map to follow.

I am optimistic that we can successfully achieve these goals and show the rest of the nation the Aloha way.

Bananas, History

Old Bananas

From Hawaiian Annual, Hilo Fifty Years Ago, by J.M. Lydgate (published in 1923, this refers to events of 1873):

A bunch of the largest bananas ever produced in Hawaii, according to the report of the government experiment station, was taken to the mainland this past summer by Dr. W. E. Slater, grown by him at his home on Dole street, and destined for Minneapolis.

The individual bananas averaged eight inches in length and three inches in width, and the entire bunch weighed seventy-three pounds. There have been heavier bunches of more hands of the ordinary sized fruit, though this may be the record, as stated, for individual bananas. Unfortunately the kind or variety was not given.

 

Current Affairs, Peak Oil, Sustainability

ASPO Conference

I’m in Houston to attend the Produce Marketing Association tradeshow, which started last Friday.

I decided to stay on for the Association for the Study of Peak Oil (ASPO) conference, which started Wednesday. ASPO is a non-partisan, non-profit association dedicated to the study of “Peak Oil.” That’s a term describing the last point at which the world’s supply of oil can accomodate the demand for oil. After that, demand will permanently exceed supply.

I became aware of ASPO while scanning the Internet. Its supply-and-demand, common sense approach to the problem resonated with me, so I started to read its daily report. I followed those reports and came to the conclusion that ASPO does offer a balanced approach.

When I learned ASPO’s U.S. conference was occurring just after the PMA trade show and in the same city, I decided to attend. So here I am.

This conference is, by far, the most interesting and important one I have ever attended. Its panel members and presenters have stellar credentials—they are former CIA officials, executives from major oil companies, investment advisors, university researchers, etc. The presentations have been full of substance. I’ve sat through presentations from 8 a.m. to 9 p.m. without wanting to skip out.

I am now absolutely certain that ASPO is credible and that its web information update on the Oil Drum is also credible.

A relatively few giant oil fields produce most of the world’s oil. There have not been any significant new oil fields discovered in the last 20 years, and the older, super-giant oil fields are declining in production. Discoveries of new, smaller oil fields are barely keeping up with the fields that are declining.

The big problem is that the demand for oil is increasing at an alarming rate. China is growing at an incredible rate. It has 10 times our population, and right now only 16 percent of its people own cars. And then there’s India, too. Soon we will reach the point where oil production cannot keep up with world demand for oil.

No one knows when, but ASPO feels this will occur around 2012, which is just over four years from now. Others think it will occur 10 years later. Many think that it has already happened.

No one debates whether or not Peak Oil will occur—they only disagree about when.

Regardless of when, it is prudent to take action before we get to that point. We need to spread the word that we are close to a serious turning point regarding our oil supply. And we need to get people’s advice about what actions we should take.

More than 60 percent of America’s oil use is for transportation. Can we adjust to our gas prices rising four-fold? Agriculture, too, depends on fossil fuels, as do fertilizer, chemicals, packaging and transportation. Therefore, imported food prices will start to rise.

Can we make the adjustments we need to do? Will we be able to feed Hawai‘i’s people?

In Hawai‘i, I believe we can make the adjustments we need to keep our food distribution dependable. But it is going to require thinking “outside the box.” We all can do this!

Sustainability

Suppy and Demand

The Houston Chronicle just ran this op-ed piece titled Don’t Drain Our Energy Lifeblood, with the subtitle: “Domestic exploration is energy security 101.” It says that Americans burn nearly a half billion gallons of gasoline every day, and that 65 percent of the oil that makes this gasoline is imported. Also, that worldwide energy consumption is anticipated to increase by 40 percent in the next 25 years—while the widespread use of alternate energy is still decades away.

The article argues for drilling in the Arctic National Wildlife Reserve, as well as in the offshore continental shelf. The revenue generated, it says, could be used for alternative energy development.

“The Arctic National Wildlife Refuge may offer oil reserves of as much as 16 billion barrels — which is comparable to the world’s largest oil fields. Even though the environmental impact would be minuscule, Congress insists on keeping the refuge and other potential domestic resources off-limits and ignores the fact that modern exploration techniques could limit drilling in the refuge to a 2,000-acre footprint, or not even half of 1 percent of the refuge’s 19 million acres.“

It concludes that our country’s energy dependency makes us dangerously vulnerable in economic terms and compromises our national security.

Public policies that support, rather than impede, efforts to increase responsible domestic production are what America needs to retake control of its energy lifeblood from rogue dictators and banana republics.

The article’s author is Elizabeth Ames Jones, immediate past chairman of the Texas Railroad Commission, which regulates the state’s oil and gas, propane, mining and intrastate pipeline industries.

It got my attention, appearing as it did the Sunday immediately before the Association for the Study of Peak Oil (ASPO) conference will be held in Houston — and just before oil prices reached more than $86/barrel, a record high. It strikes me that as world demand for oil rises in the years ahead, there may well be a gap between the energy our country can get from oil and the energy we can get from alternate sources.

The Queensland, Australia government also just published a report acknowledging that “Peak Oil” — “the potential peaking of world oil supplies caused by natural field decline” — is a real concern and will happen within 10 years. Together with the op-ed piece above coming out of the gas and oil capital of the U.S., as well as the upcoming ASPO conference, I think these are all significant indicators.

Education

Keaholoa

Last year I was appointed to the board of advisors of the Keaholoa STEM program at the University of Hawai‘i at Hilo.

This is a program that aims to increase enrollment, support, and graduation rates of Native Hawaiian students at UH-Hilo in science & mathematics disciplines, and increase familiarity and the use of related technology.

It’s a valuable program, which also does outreach to Hawaiian students from Kindergarten to 12th grade. Its existence is in jeopardy because it may lose its primary source of funding—the National Science Foundation. This program needs dependable local funding. We cannot depend on the National Science Foundation for such an important program.

The name “Keaholoa” means “the long fishing line” and is “a metaphor for the academic tools mentor-teachers will provide STEM (Science, Technology, Engineering, and Mathematics),” with which students “will learn how to plumb the depths of academic inquiry.”

An ‘olelo no‘eau, or traditional Hawaiian saying, goes like this: He lawai’a ke kai papa’u, he pokole ke aho; he lawai’a no ke kai hohonu, he loa ke aho. (A fisherman of the shallow sea uses a short line; a fisherman of the deep sea has a long line.)

It means, “A person whose knowledge is shallow does not have much, but he whose knowledge is great, does.”

Shortly after being appointed to the Keaholoa STEM board I was invited to a Ho‘ike, where the students gave reports on their internship projects.

I didn’t know what to expect and I was surprised—and impressed—by the imagination and careful thought that went into choosing topics to study, and by the execution of those projects.

Some of the presentations at the Ho‘ike:

• One student studied the effect of fog on Lana‘i’s aquifer. Lana‘i lies in the lee of Maui and is relatively dry. However there is a fog that comes through, condenses and runs down trees into the aquifer. There was a significant effect based on condensate that was caught and measured.

• Another student studied the health of coral at the ponds off Vacationland at Kapoho. This involved putting on scuba gear and taking periodic measurements of the health parameters of the coral.

• One student chose to do a DNA comparison between coqui frogs found in Hawai‘i and coqui frogs in Puerto Rico. Those in Puerto Rico could be identified by the elevation they lived at.

• A student studied the health of Hilo Bay by measuring dissolved oxygen, turbidity and other parameters at various locations around the bay.

There were many other presentations that were just as imaginative, relevant and very well executed.

I came away from the Ho‘ike feeling confident that Hawai‘i is in good hands with these young students. It was an uplifting feeling.

From the Keaholoa STEM website:

Keaholoa STEM uses an Outreach Program that builds a strong sense of identity, raises career goals, educational aspirations, and provides meaningful learning experiences through STEM courses and other activities. Keaholoa will reach into the local community in a way that respects and values Hawaiian culture and builds upon the potential for academic achievement in Hawaiian youth. We are partnering with Na Pua No’eau- Center For Gifted and Talented Native Hawaiian Children at UHH, to take advantage of the proven educational practices and statewide resources developed by them over 11 years of successful outreach to native Hawaiian communities.

Outreach Program Elements:

•Super Enrichment Saturdays (K-12 students)
•Summer Institute (K-12 students)
•Hawaiian Family Affair (entire families)
•High-School Mentoring/Tutorial Program