Posted on 09/02/2005 5:44:37 AM PDT by Herosmith
WASHINGTON — The United States has an oil reserve at least three times that of Saudi Arabia locked in oil-shale deposits beneath federal land in Colorado, Utah and Wyoming, according to a study released yesterday.
(Excerpt) Read more at seattletimes.nwsource.com ...
Screw Congress, now is the time for the White House should take action and show leadership!
I'm all for that. It would quickly pay itself back not only in terms of increased local supplies, but less need of foreign meddling.
Dear Hermann the Cherusker,
Well, if we were able to eliminate imported oil (and there's plenty of shale oil, and other stuff available, to do so), we would also reduce the trade deficit by a pretty number.
I think last year, the average price of oil was something like $40 per barrel. That's for 2004. At 12 million barrels per day of imported oil, that's about $175 billion.
It seems to me that a more stable energy supply, even purchased at a modestly higher price, could benefit the United States in more than one way.
sitetest
Traditionally oil companies form a consortium to spread the risk involved in exploiting a new field. Many overseas oil companies are essentially arms of their national governments, however.
Chop the EPA off at the knees and allow new refineries to be built and watch gas and oil prices drop before the shovel
of construction hits the dirt.
?shovel of construction? you know breaking ground.
The cost of extracting oil is the concern of the oil company at present. The national trade deficit is the responsibility of the government. Unless we were to rearrange the economy by either going "protectionist" or alternatively nationalizing the oil industry there is no way to kill both of those birds with one stone.
"before the environmentalists hamstring us..."
It is time to MAKE these nuts stand down! We have sat back and allowed them to hamstring us.
Nice car. Did it come equipped with those three disposable doormats?
Much of the Alaskan North Slope is this way.
When it is depleted, we will then use our reserves, which will be far more cost efficient at $100 a barrel.
If the claim of 10 year to begin production is true, continued waiting will keep our oil in the ground until a cheaper alternative to oil is produced. But still many here want to keep sending the oil royality payments to other governments instead of our own.
What about the sour crude? They never touch that stuff because of the sulphur content.
I think its a refinery issue right now. Until we build more refineries we will continue to see tight supply.
I have not seen long gas lines. I hope that people realize that they don't need to top off their tanks every mile or so.
Dear Tallguy,
"Unless we were to rearrange the economy by either going 'protectionist'..."
You're right. To impose a tariff on imported oil would be a moderately protectionist act.
And usually, I'm against protectionism. I just don't think it's economically worthwhile in the long run.
But there are more matters here than strictly economic.
Unfortunately, we get a lot of our energy from fairly thuggish regimes around the world. We get oil from places like Saudi Arabia, Iraq, Kuwait, the other Gulf States. Although we have a ban on it, oil is fungible, and so there's Iran that enters into the picture. Russia has decided to use its vast oil reserves as a way to leverage their power against the United States.
And of course, we have places like Nigeria and Venezeula.
In the meantime, if China continues to grow (and if India picks up steam), pressure will be further exerted on world markets.
Energy is a fundamental input to our economy, and our energy picture, as it is, is a bit precarious. In fact, as we see from the current disaster, it's quite precarious (although that is at least in part because we have no excess refining capacity).
This may be an issue where we may wish to engage in a little protectionism, to add a little security to, to reduce a little risk from, our national security.
That it would take a big bite out of our trade deficit is just a nice secondary effect.
sitetest
Yes, refining is the limiting factor in the US for gasoline... but refining isn't what's causing 70 bbl pricing.. market manipulation is.
Prices at the pump are going to go up for a while as the refineries in LA are offline.
Again though, this is not something that affects CRUDE prices...
When CRUDE oil from the low hanging fruit (like the middle east) truly begins to run out, and prices hit the 60 or 70 bbl range from that, and have no chance at all of ever going down (a true supply crunch) shale oil will become profitable to tap.
Right now though, oil is artificially at 70bbl, its a bubble and its going to go back down to 30-40 bbl.. its just a matter of if, just a matter of when. Everyone in the oil business knows this. Every hedge fund in america is putting money into oil futures, driving it up, just like they did tech stocks... and when it pops, its going to pop hard, just like tech stocks.
When the true tipping point occurs on the easy to get at oil, that's when Shale and other reserves will become profitable and tapped... but right now, we are not at that point.
Correct! So we have this odd situation where long lead times and monster capex requirements keep the shale in the ground. But why doesn't the same reasoning apply to offshore rigs, which also have huge capex requirements?
I agree with your comments.
I am still waiting for someone to post the article about the car that runs on water and the one that gets 500 MPG.
I know they are out there.
a big plus is that it isn't in a hurricane-prone area.
No, I'm talking CRUDE V CRUDE.. to get a bbl of CRUDE out of the ground in Saudi Arabia it costs em about $5 A BBL.. to get a bbl out of the ground from shale runs about $20 a bbl... thats raw cost.
When the "tipping point" is truly reached, and the easy to extract oil is honestly running out (its not right now, in spite of the naysayers) and prices on that shoot up, and have no chance at all of going down, that is when things like SHALE extraction will become worth doing... or when technology finds a cheaper way to extract it... but no matter what it will NEVER be as cheap as pumping liquid right out of the ground.
Shale oil also has other issues, above and beyond extrating the oil from the rock.. Its NOT a panacea, but it is good to know its there, and will be there when the low hanging fruit runs out. But we aren't at that point yet.
I got a bridge in NY I can sell you.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.