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Oil May Be Finite, But U.S. Production Is Ramping Up
Hugh Pickens writes "The WSJ reports that the discovery of the gigantic and prolific Bakken oil fields of Montana and North Dakota have already helped move the U.S. into third place among world oil producers, and according to Harold Hamm, CEO of Continental Resources, the 14th-largest oil company in America, if fully developed the field in Bakken contains 24 billion barrels, doubling America's proven oil reserves. One reason for America's abundant supply of oil and natural gas has been the development of new drilling techniques, including 'horizontal drilling,' which allows rigs to reach two miles into the ground and then spread horizontally by thousands of feet." Not surprisingly, Hamm considers some of the current administration's loans and subsidies for alternative energy ventures to be misplaced.
No matter how much oil we find here it would be unwise to burn. Hot planet!
So they maybe found enough for three years and a half years of consumption at current rates. The problem is now truly solved.
Has he never heard of CO2? Why would any sane person want to burn all that and turn it into CO2?
Oh, yeah, profit. Fuck the Earth and all future generations, there's profit to be made! I can own sixteen mansions instead of twelve and have a bigger yacht.
Because the only people who make any money are the CEOs with the twelve mansions you mention? What about the tens of thousands of jobs that we could use in our economy, right now - or the fact that energy prices are climbing precisely when Americans are suffering through the toughest economic times since the 1920s?
Not surprisingly, Hamm considers some of the current administration's loans and subsidies for alternative energy ventures to be misplaced.
That guy is an idiot.
24e9 barrels / 20e6 barrels per day just for the US / 365 days per year = a bit more than a 3 year supply, assuming it can all be recovered. Realistic recovery ratios are always WAY less than 100%... Figure just several months supply, realistically.
So, some 1%er will make hundreds of billions of profit.. nice for him... and 3 years later, we'll be wishing you had a solar panel...
http://en.wikipedia.org/wiki/Peak_oil
"Science flies us to the moon. Religion flies us into buildings." - Victor Stenger
Please note the byline at the bottom of the article stating, "Mr. Moore is a member of the Journal's editorial board. ". This is an editorial, not a factual article. It's also informative to temper Mr. Hamm's personal enthusiasm with a look at the US oil production record from the U.S Energy Information Administration (205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPUS1&f=M). Although there is an upturn in US production since 2006, it is unlikely that we will drill our way out of the peak oil decline.
I love how "climatologists" are economically driven by grant money (as if a competent scientist couldn't make a better living easier working for private industry than working for government grants!) but oil producers are altruists who clearly have only humanity's best interests at heart.
Regulations are so tight that Mr. Hamm has only been able to make the top 50 wealthiest Americans. This administration is killing billionaires! When a hard working man can't go from say, number 33 to number 5 in total wealth, it is time for us to realize Obama is killing oil production! (and now for something completely different)
Hamm has the nerve to say Obama is killing US oil with regulations?? How the hell have we ramped up production in the last 5 years if the regulations are so bad? Why are companies developing the Bakken if regulations are so bad? More like they aren't making as much money as they want. Cause billions upon billions just is never enough... never enough. The greed is beyond repulsive; it's psychotic.
(Happily will admit that US production helps keeps gas prices from soaring. I am not complaining about oil production. I am pointing out the greed of these bastards is insatiable.)
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Kind of sounds like a drug addict. "I'm going to quit eventually, but right now I need that hit."
Economically, petroleum is even more of a finite resource. Currently Saudi and other middle eastern oil keep prices down. Estimates say it costs about $2 a barrel to extract oil in Saudi Arabia. Venezuela oil might costs three times that much to extract. US oil might be as much as $20 a barrel. At these extraction costs a barrel of oil is $80, and it costs over three dollars at the pump in the US. Now, one can blame the greed of the oil companies, but that is not going to change. Explorations costs are not going to decrease either.
OTOH, conservative extraction costs for so-called shale oil, the better name is tar pits, is $75 dollars a barrel. If the oil companies sell at a comparative markup, this means that the selling price would be $300 a barrel. If we just add $60 profit, that would still be $135 a barrel. This puts gas firmly in the $5 a gallon range.
Recall that the oil companies were going bust when oil was below $50 a barrel. This was still a large markup over extraction costs, but oil companies appear to be extraordinarily inefficient and require a large markup. It would be fantasy that the oil companies are going to give away the product. If shale oil forms a large percentage of the petroleum mix prices will go up, consumption will eventually go down as it did a few years ago. Oil companies will either have a choice of selling at higher prices for lower volumes, or find another product.
Therefore shale oil is not an indication of a long term prosperous oil economy, but a clear signal that oil is becoming too costly to base an economy on.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
As opposed to renewable energy sources who's sites are crewed by unicorns?
CO2 concentrations have already significantly increased due to human influence (burning of fossil fuels). So there should be more than enough for the growth of plants.
The contribution to the Greenhouse effect is estimated at 9-26% of all greenhouse gases according to Wikipedia. Not dominating, but not negligible either.
So GP was either uninformed or trolling. Probably the latter.
C - the footgun of programming languages
Funny how a game can emulate reality, and then reality can re-emulate the game: http://www.molleindustria.org/en/oiligarchy
Gas was as expensive as it is now when Bush was in office. In any case, your argument is post hoc ergo proper hoc.
What a fool believes, he sees, no wise man has the power to reason away.
That reminds me about the man who fell off a tall building, and every time he passed another floor he said to himself, "so far, so good!"
Any sufficiently unpopular but cohesive argument is indistinguishable from trolling.
Your first link: 165 million barrels.
US consumption: about 20 million per day.
Yep, an 8 days supply proves that there's nothing to worry about.
Alternative energy sources need to be researched and then they will create many, many more jobs without killing the climate.
Renewables are much more likely to produce jobs, and improve our economic outlook. Continuing to service the needs of the oil companies has not improved our economic outlook for a decade now. Why do you think it might suddenly start?
One day I feel I'm ahead of the wheel / the next it's rolling over me / I can get back on / I can get back on
If you really believed that, why did you post as Anonymous Coward?
Pretty clear from the charts that the CO2 levels are rising because of man made contributions. It is also completely clear that the models linking rising CO2 to rising temperature are not quantitatively accurate (temperature flat for 10 years while CO2 continues the predicted rise). http://www.climate.gov/#climateWatch . The question now is whether or not the the models are even qualitatively accurate. Being an engineer, I do not think the climate scientist have models to the 4th significant figure.
Unless there is a quantum leap in the efficiency with which electricity can be produced from non-fossil sources, we are eventually going to exhaust all the retrievable coal, oil and gas in the earth's crust. What is considered "retrievable" is a moving target determined by current extraction technology. Even if the U.S. were to institute subsidies that evened the playing field between fossil sources and green sources in the U.S., it is unlikely those subsidies would be duplicated across the entire globe. Ergo it would remain profitable to extract U.S. oil. It seems unlikely there will ever be the political will to forbid oil exploration and extraction altogether in the United States.
It's also worth noting that extracting and refining this particular cache of oil does not significantly alter the global price, and therefore does not significantly alter global consumption. It is not the case that more oil will be used because this particular batch was extracted. More U.S. oil will be used, on the other hand, which means more jobs, etc. for U.S. citizens.
Given the economy is in the dumps, the only reasons I can see not to extract it are:
* Strategic. When oil becomes scarce (and thereby prohibitively expensive) we want to have national reserves on tap for military consumption.
* Environmental, but in a local sense. You could argue that the environmental costs at the point of extraction are just too high.
"Global warming" doesn't seem like a compelling reason at the moment given the small percentage of global production these new fields represent. "Drill here, drill now, pay less" is a ginormous fallacy. To the extent "pay less" is fallacious, though, so is the notion that domestic drilling will lead to more consumption and consequently more atmospheric CO2.
This guy can't drill oil at low prices ... it's the increased price which is making shale oil profitable, and then only just (which is why he's crying for subsidies, to make even less easily recovered oil profitable). There are security reasons to have your own oil supply, but cheap it's never going to become again.
Wind/Solar and "synthetic natural gas" [sic] have much a better chance of getting large cost reductions going forward.
What concerns me is that I live in a state that's right on the ocean, so, all that crap water coming from red states up river from me has the chance to screw up our crops and our drinking water. Fortunately, the city owns the entire water shed so those chemicals shouldn't be getting into our water, but there's a good chance that they'll end up polluting the fisheries in other states.
Assuming you're indeed an American, quit whining about gas prices and it "killing the economy". Apparently one dollar per liter is currently considered "zomg expensive" (ref: http://gasbuddy.com/gb_gastemperaturemap.aspx). In Europe, ten years ago, one liter costed anything between 99 and 109 EUROcents (that's $1.32-$1.45). You don't even want to know what they're paying there now.
Horizontal drilling isn't fracking. You frack frist to break rock which then allows horizontal drilling.
And of course the environmental impact of fracking is increasingly being called into question.
Green companies are (usually*) not profitable when competing with . . . uh . . . "dirtier" competitors without government subsidies . . .
But, as any one could have guessed this was coming, that's not factoring in that said competitors are inherently subsidized by not paying for all external costs. That's a very, very important note. Coal is cheap and profitable, but has huge external costs. Nuclear is very expensive and nowhere near as profitable, but it pays off a much higher portion of its external costs. Same with a lot of greener technology. So it's a market failure that's helping tip the scales.
* There are exceptions, of course. I've heard that the paper industry has been moving progressively more sustainable because it's in their favor. IIRC, modern paper plants obtain most of their power from their own waste. They still do pollute, but then again I imagine that's the fundamental nature of having to serve a tremendous worldwide demand.
I read TFA and all I got was this lousy cookie
... of techniques. Nor is it new, for any meaningful meaning of "new". In fact, it was old hat a decade ago. As was "extended reach" drilling, which is likely to be next week's buzzword.
I've been doing horizontal drilling, in the oilfield sense, using Norwegian techniques from Finnish and South Korean rigs, with multiple nationalities, for longer than I've been posting on Slashdot. All of which time spans are bloody long times (in a non-geological sense of "bloody long").
("Extended reach" drilling ... about the same duration that I've been on Slashdot. Give or take a half-decade.)
Birds are not dinosaur descendants;birds are dinosaurs, for all useful meanings of "birds", "are" and "dinosaurs"
Ask your grandpa what a factory was like before the EPA. Environmentalism a luxury in poor countries? Yeah, and so is food.
You have no right to dirty up MY air and water. Clean air is my right.
Free Martian Whores!
The idea that only an oil-intensive economy is capable of adaptation is laughable.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
Because his "no warming since 1998" claim relies on some serious cherry-picking of temperature data, and he's afraid of people linking this dishonesty back to him.
(IANAL)
OK, guys here's the deal.
First review the numbers around oil (i.e. how much we've got and what that means energetically). For that, look here: http://en.wikipedia.org/wiki/Cubic_mile_of_oil
Then look here to see how much we have access to in the USA: http://en.wikipedia.org/wiki/Oil_reserves_in_the_United_States.
I'd refer everyone to a web site for consumption rates, but the ballpark answer is that the world uses 28-30 billion barrels of oil per year, and the USA uses between 7-8 billion barrels per year. We have about 1.4 trillion barrels of technically recoverable conventional oil left. Perhaps about 50% of that is economically recoverable today. Perhaps a bit more as prices rise, if prices don't rise enough to break the world's supply chains or cause nationalistic hoarding - two very distinct possibilities.
The most optimistic assumptions regarding conventional oil that's both energetically and economically profitable is about 40 years max. Realistically, expect about half that. After that, we're um, scraping the bottom of the barrel. Oil doesn't disappear (It never will). We just won't be using it as much. Too expensive energetically and economically.
Bottom line? All the "Drill ANWR and we're saved " idiots would have us destroy the Alaska ecosystem for about 2 years extension of our oil supply. Every moronic Reuters news story that so breathlessly reports that over 1 billion barrels of oil have been found ignores the fact that 1 billion barrels is less than 2 months supply just for the USA, much less the planet.
There are plenty of alternatives and solutions, just none that involve having 7 billion people or more living on Earth in the year 2100 using as much energy as an American uses today.
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It's those low prices which have "killed the economy". Going from $1.50 gallon to $3.50 gallon is a much bigger shock than going from $4.00 to $6.00 gallon.
Gas taxes need to be raised - at a minimum enough to pay for road infrastructure, but probably a good amount more (gradually, of course). But no-one has the balls to do it.