Background
The world uses 85 million barrels (U.S. is about 21 MBD) of oil/day (31 billion bbl/year—7.7 BBY in U.S.). The U.S. imports 65% of the oil we use, or 5 billion bbl/year and will over the next year send $700 billion to foreign suppliers. Forty-five percent of our oil becomes gasoline. A SPECIAL CASE IS HAWAII, where 38% of all energy used goes to aviation. The national percentage is around 3.3%. The Nation uses 400 million gallons of gasoline daily at a cost exceeding $1.5 billion, amounting to $600 billion/year. The internet and YouTube have been besieged with stories on all the oil available domestically to make the nation energy self sufficient. The official numbers don’t support that contention. Plus, there is that additional matter of global climate warming, which tends to get ignored by fossil proponents. Why, then, this continuing controversy? Money, as just one month of oil in the U.S. is worth almost $100 billion.
The world uses 85 million barrels (U.S. is about 21 MBD) of oil/day (31 billion bbl/year—7.7 BBY in U.S.). The U.S. imports 65% of the oil we use, or 5 billion bbl/year and will over the next year send $700 billion to foreign suppliers. Forty-five percent of our oil becomes gasoline. A SPECIAL CASE IS HAWAII, where 38% of all energy used goes to aviation. The national percentage is around 3.3%. The Nation uses 400 million gallons of gasoline daily at a cost exceeding $1.5 billion, amounting to $600 billion/year. The internet and YouTube have been besieged with stories on all the oil available domestically to make the nation energy self sufficient. The official numbers don’t support that contention. Plus, there is that additional matter of global climate warming, which tends to get ignored by fossil proponents. Why, then, this continuing controversy? Money, as just one month of oil in the U.S. is worth almost $100 billion.
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Internet Dreams
1. Bakken Formation
Discovered 57 years ago and located in the Williston Basin (Montana, North Dakota and Sakatchewan), a couple of billion barrels of oil can potentially be extracted. Oil is being produced today, but the formation is of low porosity and costs are high. However, if world petroleum prices stay above $100/barrel, expansion will occur. Yet, over the lifetime, the Bakken Formation will supply only about a month or two of the total U.S. consumption.
2. Alaska National Wildlife Refuge (ANWR)
ANWR is located east of Prudhoe Bay in the North Slope. The controversy is clear: residents (including the Inupiat Eskimo occupants of Kaktovik located at the drill site), Republicans and industry want to drill, while environmentalists, many Alaskan tribes (including the general village of Kaktovik) and Democrats don’t. Around 3 billion barrels are potentially producible, maybe 4 months of U.S. consumption, although wild speculations provide ten times this amount. If President Bush could not ramrod this project through in 8 years, there is little hope for ANWR ever to get developed, as Obama is against and McCain is lukewarm at best.
3. Oil Shale
There are about 2 to 3 trillion barrels of recoverable oil from oil shale, more than double petroleum reserves. The U.S. might have up to two-thirds of this resource. I was a staff member of the U.S. Senate Energy and Natural Resources Committee in 1980 when legislation for the Energy Mobilization Board was enacted to form government-company partnerships for coal gasification and oil shale retorting. Nothing really happened because the real cost of oil significantly dropped from 1980 into the ‘90’s, but with the recent price surge, the industry is re-mobilizing. However, the cost of producing this fossil liquid will be at least $75/barrel, and, perhaps, more than $100/barrel. Plus, water is required in the processing. In Estonia, more than 90% of the water consumed in the country is used by their oil shale-fired electricity production industry. Finally, the killer is that the overall environmental outcome will be a higher amount of carbon dioxide entering the atmosphere, and the carbon tax looms.
4. Lindsey Williams’ 75 minute sermon on the vast amount of oil off Alaska (http://video.google.com/videoplay?docid=3340274697167011147). I was not impressed, but it was intriguing…and I watched the whole thing.
1. Bakken Formation
Discovered 57 years ago and located in the Williston Basin (Montana, North Dakota and Sakatchewan), a couple of billion barrels of oil can potentially be extracted. Oil is being produced today, but the formation is of low porosity and costs are high. However, if world petroleum prices stay above $100/barrel, expansion will occur. Yet, over the lifetime, the Bakken Formation will supply only about a month or two of the total U.S. consumption.
2. Alaska National Wildlife Refuge (ANWR)
ANWR is located east of Prudhoe Bay in the North Slope. The controversy is clear: residents (including the Inupiat Eskimo occupants of Kaktovik located at the drill site), Republicans and industry want to drill, while environmentalists, many Alaskan tribes (including the general village of Kaktovik) and Democrats don’t. Around 3 billion barrels are potentially producible, maybe 4 months of U.S. consumption, although wild speculations provide ten times this amount. If President Bush could not ramrod this project through in 8 years, there is little hope for ANWR ever to get developed, as Obama is against and McCain is lukewarm at best.
3. Oil Shale
There are about 2 to 3 trillion barrels of recoverable oil from oil shale, more than double petroleum reserves. The U.S. might have up to two-thirds of this resource. I was a staff member of the U.S. Senate Energy and Natural Resources Committee in 1980 when legislation for the Energy Mobilization Board was enacted to form government-company partnerships for coal gasification and oil shale retorting. Nothing really happened because the real cost of oil significantly dropped from 1980 into the ‘90’s, but with the recent price surge, the industry is re-mobilizing. However, the cost of producing this fossil liquid will be at least $75/barrel, and, perhaps, more than $100/barrel. Plus, water is required in the processing. In Estonia, more than 90% of the water consumed in the country is used by their oil shale-fired electricity production industry. Finally, the killer is that the overall environmental outcome will be a higher amount of carbon dioxide entering the atmosphere, and the carbon tax looms.
4. Lindsey Williams’ 75 minute sermon on the vast amount of oil off Alaska (http://video.google.com/videoplay?docid=3340274697167011147). I was not impressed, but it was intriguing…and I watched the whole thing.
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5. Tar sands: not much in the U.S. Most of this resource is in Canada and Venezuela.
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6. Offshore oil is a particularly contentious issue, with candidate Obama agains and McCain for. This is that typical Democrat versus Republican issue. David Block of the Florida Solar Energy Center has indicated to me that he will soon publish a paper on this issue, so we will wait till then.
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My take on why resource estimations range so wildly is that the high guesses tend to assume that most of the oil in place can be extracted. The reality is that the actual recoverable and commercial reserve can be as low as one percent of that total. The uncertainty between the extremes results in all those optimistic prognostications. And, what about global climate warming?
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Tropical storm Bertha is beginning to actually move East, away from the U.S. New Tropical Storm Elida could turn into a hurricane, but should weaken as she approaches Hawaii.
Oil is selling for around $144/barrel.
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My take on why resource estimations range so wildly is that the high guesses tend to assume that most of the oil in place can be extracted. The reality is that the actual recoverable and commercial reserve can be as low as one percent of that total. The uncertainty between the extremes results in all those optimistic prognostications. And, what about global climate warming?
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Tropical storm Bertha is beginning to actually move East, away from the U.S. New Tropical Storm Elida could turn into a hurricane, but should weaken as she approaches Hawaii.
Oil is selling for around $144/barrel.
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