Peak Oil is You
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Page added on June 11, 2013
Earth may have more oil than anyone thought
There could be a lot more oil and gas out there than we thought. But it’s going to cost a whole lot to extract it.
The Department of Energy’s Energy Information Administration has upgraded its estimates of global oil reserves by 11% after scouring 41 countries and finding a lot more “technically recoverable” shale oil and shale gas than it did the last time it filed a similar report, in 2011.
Since then, the EIA’s shale gas estimates alone have jumped by 10% and its estimate of gas reserves has soared by 47%. The U.S., China and Argentina are all largely responsible for the upticks in shale oil and gas numbers, while Russia’s shale oil stockpile and Algeria’s shale gas resources also place them among the EIA’s top four potential producers in each category.
Note the use of “potential” there. As we noted in November — just after Superstorm Sandy slammed into the East Coast, wrecked refineries and caused a supply shortage that led to gasoline rationing and military assistance — the idea of peak oil remains far more frightening than it appears.
While the EIA’s numbers are promising, they’ll ward off peak oil only if extraction technology catches up to the potential of that latent supply. M. King Hubbert created the first peak oil model in 1956 and predicted U.S. oil production would peak between 1965 and 1971. Globally, he believed oil production would peak in 1995, which clearly didn’t happen.
Even if oil hasn’t peaked, it’s starting to feel as if it has. Exxon Mobil (XOM -0.72%) said in 2005 that “all the easy oil and gas in the world has pretty much been found.” Meanwhile, former Shell chairman Lord Ron Oxburgh warned in 2008 that “any new or unconventional oil is going to be expensive.”
The Bakken shale formation sitting beneath North Dakota, Montana and Canada’s Saskatchewan and Manitoba provinces, for example, has been estimated to contain anywhere from 4 billion to 150 billion barrels of oil, though current extraction methods provide access to less than 10% of it. Oil sands just beneath Edmonton in Canada’s Alberta province hold an estimated 175 billion barrels, making it the third-largest oil reserve in the world. But it’s going to spend much of the near future untapped.
The problem is that even extraction methods like fracking are in their crudest stages and don’t come close to being adequate for most oil sand extraction. The oil in those shales isn’t easy to separate from the sand and water surrounding it and leaves huge waste pools in its wake. That mess costs money, and it’s only going to get messier as those oil numbers surge.
8 Comments on "Earth may have more oil than anyone thought"
Arthur on Tue, 11th Jun 2013 11:40 pm
That is exactly what you want: a lot of extra, but very expensive oil, to be used to set up an alternative energy base, using the expensive fuel.
SilentRunning on Wed, 12th Jun 2013 1:11 am
“Technically Recoverable” is not what puts gas in your car. The oil/gas has to be economically recoverable, actually discovered and extracted. “Technically recoverable” means a lot of it will never, ever be produced because it will take more energy to extract it than it yields.
So once again- we are still at peak oil, and the production will still be going down. Yes, shale gas and oil will be produced – but not fast enough to make up for declines in old traditional wells.
BillT on Wed, 12th Jun 2013 4:36 am
“Earth may have more oil than anyone thought”
And the moon may be made of green cheese…lol.
The most telling fact that we have passed from Peak Oil into uncharted and dangerous territory is the plethora of articles denying it. You can hardly open a magazine or newspaper or go online and not see report, article or book about the oceans of oil we have left to recover.
Rarely is mentioned that most of that oil, if it exists, will never be recovered. Some reasons why:
Cost vs Profit
Globalization failure
Financial failure
Wars
Climate Change
Citizen prevention
Some other ‘black swan’ event we are not aware of.
mike on Wed, 12th Jun 2013 7:42 am
BillT is totally right, the more trouble we get in, the more everyone will say everything is fine until pop. It’s absolute textbook human behavior.
Hugh Culliton on Wed, 12th Jun 2013 10:42 am
Well break out the Texas Tea and roll me in light, sweet Brent – the happy days are here again! I think my next car’ll be a Caddy Escalade as we don’t need to worry about that bummer ‘peak oil’ thing. Wait a minute…what was that word ‘might’ doing in there? Wow, way to harsh my mellow:-( Curse you, Reality!
Jerry McManus on Wed, 12th Jun 2013 5:25 pm
When reading any article about abundant energy supplies it is wise to always ask at least two questions:
At what rate?
At what cost?
The second question is actually three questions:
What cost economically?
What cost environmentally?
What cost in energy invested?
To their credit the article touches on economic and environmental costs, but as has been pointed out that is not the whole picture.
KingM on Thu, 13th Jun 2013 12:51 pm
Some of you guys didn’t bother reading the article. The article doesn’t actually claim that good times are going to last. In fact, it points out that there may be a lot of oil out there, but it’s going to be very expensive to get.
Which is pretty much the same thing you’re arguing, right?
GregT on Thu, 13th Jun 2013 3:22 pm
Cheap, expensive, or free. Eventually it will run out.
Maybe it would be a good idea to start planning for a future without it?