Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

The Truth about Oil
FrontPageMagazine.com ^ | May 08, 2008 | Vasko Kohlmayer

Posted on 05/08/2008 6:31:14 AM PDT by K-oneTexas

The Truth about Oil  
By Vasko Kohlmayer
FrontPageMagazine.com | Thursday, May 08, 2008

A recent survey on the environment found that seventy percent of people worldwide think that the planet is running out oil. Only less than one quarter believe that there is enough of it to keep it as a primary source of energy. Petro pessimism runs especially high in the United States where a full two thirds think that the point of depletion is within sight.

Here are some hard facts.

According the Energy Information Administration as of January 2007 there was more than 1.3 trillion barrels of proved crude oil on earth. Even if this were all the oil on the planet there would be no immediate danger of shortages, because at the current rate of consumption – roughly 85 million barrels a day – this supply would last for more than 40 years.

But the 1.3 trillion in these so-called proved reserves refers only to a tiny fraction of earth’s oil, designating only that portion which can be extracted under current ‘economic and operating conditions.’ As it happens, this figure grows with each decade and usually dramatically so.

In 1882, for instance, there were 95 million barrels of proved petroleum reserves. This number jumped to 4.5 billion in 1926 and then to 10 billion in 1932. In 1944 the quantity stood at 20 billion. In 1950 it leaped to 100 billion and in 1980 it was 648 billion. In 1993 the world’s proved reserves grew to 999 billion, and today they stand at 1.3 trillion barrels.

These figures show that our ever-increasing consumption has not over the years reduced the pool of available oil. In fact, the exact opposite is the case – each successive year we have more of it than ever before. Contrary to the conventional wisdom, mankind’s oil supplies are not getting depleted, but they keep continually expanding.

There are several reasons for this. New exploration and advancements in surveying techniques in particular result in fresh finds almost every year.

We have seen a dramatic instance of this at the end of last year when a massive reservoir was discovered in the Tupi sector off the coast of Brazil. Estimated to hold some 8 billion barrels of recoverable crude it was the second largest find in the last 20 years. Two months later an even greater deposit was located nearby which may hold as much as 30 billion barrels. If confirmed, the field would be the third biggest on the planet, behind only the Ghawar in Saudi Arabia and the Burgan in Kuwait. Many scientists are now convinced that intense exploration fuelled by high prices will yield comparable discoveries in other places of the globe.

Adding appreciably to the proved reserves is the continual perfecting of drilling techniques. This makes it possible to tap deposits which because of their depth or geological environment were off limits only a few years ago. Today’s equipment can perform mind-boggling feats of horizontal drilling and there are oil rigs capable of reaching 35,000 feet under the surface, about double of what the previous generation could do.

Rising prices also make available oil which was previously considered unrecoverable commercially, because for whatever reason the extraction cost per barrel exceeded the price it could fetch on the market. With every jump in price, however, more and more of such oil is brought up as its production becomes profitable.

Finally, improvements in extraction processes make it possible to more fully utilize currently harvested reservoirs. Due to technical and economic limitations, normally only a portion of an oilfield can be recovered (it is this part that is referred to as the ‘proved’ reserve). A few decades ago the average oil recovery rate from reservoirs was 20%, but thanks to technological progress this rate is nearing 40% today.

It is the combination of these factors that accounts for the fact that more and more is added every year to mankind’s stock of crude oil. This in turn results in a seemingly paradoxical outcome. Even as our consumption increases with each passing year, the projected depletion point keeps moving further out into the future.

In 1986, for instance, it was estimated that the world’s proved reserves would last 38 years. On that estimate we should only have 17 years worth of oil left. But because the figure in the ‘proved reserves’ column keeps getting larger, we now have more than 40 years.

This dynamic has been in place ever since gasoline began to be mass consumed. Due to the continuing exploration and technological advancement, we can be virtually assured that two or three decades from now we will be talking about another 40 or 50 or more years worth of crude. Cambridge Energy Research Associates, one of the world’s premier energy advisors, predicts that earth’s proved reserves could increase by as much as 25% by 2015.

But there is more to the story. So far we have only been considering crude oil, but crude is not the sole source of this strategic commodity. There are far greater amounts of it locked in other materials such as shale, coal and tar sands.

Proven technologies exist to obtain oil from these resources but they have not yet been widely exploited, because until quite recently the extraction costs – ranging from $40 to $90 per barrel – exceeded the market price. The currently high and rising prices, however, are quickly turning these methods into potentially profitable ventures.

With many companies positioning themselves to take advantage of the opportunity, we are witnessing the birth of a giant industry and one that might eventually eclipse that in crude oil.  This is because the estimated global deposits of recoverable shale oil alone exceed three trillion barrels. This is more than twice the world’s current crude oil reserves.

America is especially well endowed on this front as it has nearly 75% of the planet’s known oil shale deposits. The Bureau of Land Management estimates that the Green River Formation of Colorado, Utah and Wyoming alone ‘holds the equivalent of 800 billion barrels of recoverable oil.’ This is three times the proved oil reserves of Saudi Arabia. At current consumption levels, that quantity would satisfy America’s needs for 110 years.

Like shale, coal is another enormous repository of oil. Technology to liquidify it has been around since the 1920s. Germany was the first country to utilize it on a mass scale when during World War II it sought to compensate for a lack of crude. Today this technology is successfully exploited by South Africa whose three liqudification plants produce150,000 barrels a day, the equivalent of the output from a medium-sized oilfield.

The United States – with roughly 27 per cent of the world’s recoverable coal – is especially well positioned to benefit from this resource. A couple of years ago, the New York Times pointed out that ‘the coal in the ground in Illinois alone has more energy than all the oil in Saudi Arabia.’ It is estimated that at a standard conversion rate of two barrels of synthetic fuels from one ton of coal, America’s reserves are equivalent to 20 times the nation’s proved crude. In other words, liquefied coal could satiate America’s petrol thirst for two hundred years.

But even coal’s potential is exceeded by that of tar sands which may hold as much as two thirds of the planet’s petroleum. Tar sands occur in many parts of the world with large deposits in Canada, Venezuela, the United States, Russia and various countries of the Middle East. Canada alone is estimated to have some 1.7 trillion barrels of which about 10% is recoverable at today’s prices and with existing technology. The country’s tar sands alone make Canada second only to Saudi Arabia as an oil resource country.

Tar sands account for one million barrels (about 40%) of Canada's oil production with the number growing each year. America’s largest oil supplier, Canada provides about 20% of our imports of which a substantial portion comes from this untraditional source. So vast is its potential that a CBS broadcast stated ‘the reserves [of tar sands] are so vast in the province of Alberta that they will help solve America's energy needs for the next century.’

With estimated 30 billion barrels of recoverable petroleum from tar sands, America’s own supplies are not negligible either. A concentrated effort to launch wide scale commercial mining was launched in the late 70s, but the subsequent drop in oil prices led to the project’s abandonment. The $100 plus per barrel rate, however, is likely to change this situation in not-too-distant future.

All this should make one thing amply clear – there is enough oil to go around for a very long time. Even on conservative assumptions – accelerating consumption and few new discoveries – earth’s oil supplies should last for at least a century.

This, however, is the worst case scenario. We can be reasonably certain that new exploration and advancing technologies will in coming years greatly add to the quantities of available oil. So much so that Morris Adelman, Professor Emeritus in Economics at Harvard, has argued that the ‘amount of oil available to the market over the next 25 to 50 years is for all intents and purposes infinite.’

The notion that this planet is running out of oil is one of the great misnomers of our age. There is more oil available today than there was a hundred, fifty or ten years ago. And there is every indication that this trend will continue into the future. Instead of lamenting that we are running out of it, it would be far more accurate to say that we are constantly bumping into new oil. This is why two years ago the Economist headlined an article on the topic The Bottomless Beer Mug. The general public, however, is largely ignorant of these facts. The divergence between the conventional wisdom and reality could hardly be any wider. Profoundly misinformed and alarmed, people place false hopes in misguided alternatives. Rather than implementing harmful, inefficient and expensive substitutes, we should insist that our government lift the obstacles which prevent us from availing ourselves of this superabundant resource.


TOPICS: News/Current Events
KEYWORDS: energy; oil
Navigation: use the links below to view more comments.
first 1-2021-4041-6061-80 ... 101-118 next last

1 posted on 05/08/2008 6:31:14 AM PDT by K-oneTexas
[ Post Reply | Private Reply | View Replies]

To: K-oneTexas

“A recent survey on the environment found that seventy percent of people worldwide think that the planet is running out oil.”

And the other 30% think there’s an unending supply? We will run out of oil some day...but I’d prefer to keep exploring until we’ve found a viable alternative (not ethanol).


2 posted on 05/08/2008 6:33:51 AM PDT by Slapshot68
[ Post Reply | Private Reply | To 1 | View Replies]

To: K-oneTexas

Good Article, BTTT


3 posted on 05/08/2008 6:34:45 AM PDT by thackney (life is fragile, handle with prayer)
[ Post Reply | Private Reply | To 1 | View Replies]

To: K-oneTexas
Note how oil and gasoline has doubled since the dims supposedly were elected majority in both the House and Senate!

The question is why no one is calling the dims on the carpet as this is no coincidence!

4 posted on 05/08/2008 6:37:10 AM PDT by kcm.org (Now unto Him)
[ Post Reply | Private Reply | To 1 | View Replies]

To: K-oneTexas

>>Profoundly misinformed and alarmed, people place false hopes in misguided alternatives. Rather than implementing harmful, inefficient and expensive substitutes, we should insist that our government lift the obstacles which prevent us from availing ourselves of this superabundant resource<<

This bears repeating. Over and over,


5 posted on 05/08/2008 6:38:22 AM PDT by netmilsmom (I am very mad at Disney. Give me my James Marsden song!!!!!)
[ Post Reply | Private Reply | To 1 | View Replies]

To: K-oneTexas

but anyway some day this planet will be “sucked dry” so we need to find other energy sources. btw. do we really want to be depending on such lovely unstable countries in the ME and else where around this planet?


6 posted on 05/08/2008 6:39:04 AM PDT by austrian
[ Post Reply | Private Reply | To 1 | View Replies]

To: kcm.org

Because it’s easier to blame Bush.


7 posted on 05/08/2008 6:39:21 AM PDT by netmilsmom (I am very mad at Disney. Give me my James Marsden song!!!!!)
[ Post Reply | Private Reply | To 4 | View Replies]

To: K-oneTexas

So what’s the problem here?

1. the “cheap oil” is either used up in the United States or in the hands of other nations.

2. the current cost of commercial exploitation of “alternate oil” in the US has not been economical, although recent changes in the market may change that.

3. Whether or not we’re willing to pay the costs of start up of the alternate petro industries and the time to bring them to commercial production.

4. Whether we can ever get our government to ignore the enviro-whackos who wish to put a stop to this. (I wish those hypocrites would just go live in the woods like they want everyone else to do).


8 posted on 05/08/2008 6:39:37 AM PDT by henkster (I'm a typical white guy.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: K-oneTexas
The general public, however, is largely ignorant of these facts.

For the purpose of manipulation.

9 posted on 05/08/2008 6:42:15 AM PDT by facedown (Armed in the Heartland)
[ Post Reply | Private Reply | To 1 | View Replies]

To: kcm.org

The second question:

How do we get this information to the general public?

Not just one time, but repeated over and over in the same way the Al Gore’s spread their “information”.


10 posted on 05/08/2008 6:42:34 AM PDT by woodbutcher
[ Post Reply | Private Reply | To 4 | View Replies]

To: kcm.org

I bet the MSM won’t let the question get out.


11 posted on 05/08/2008 6:44:33 AM PDT by Ken522
[ Post Reply | Private Reply | To 4 | View Replies]

To: austrian
do we really want to be depending on such lovely unstable countries in the ME and else where around this planet?

The best advice I could give a young man with an eye to the future would be to learn Portugese, get a degree in geology and then move to Brazil.
It is a country of abundant and stunningly beautiful (and friendly) natural resources. Of many different kinds.

12 posted on 05/08/2008 6:47:27 AM PDT by Bloody Sam Roberts (The secret of Life is letting go. The secret of Love is letting it show.)
[ Post Reply | Private Reply | To 6 | View Replies]

To: austrian

LESS PC BS and MORE NUKES — NOW!!!

We need to STOP burning petroleum/natural gas — which is portable — to boil water in stationary generation applications!!

If the frogs can safely get to 80% nuclear, just what – besides Algore and Sierra Club lawyers – is holding America back??


13 posted on 05/08/2008 6:48:12 AM PDT by Dick Bachert (INCENT)
[ Post Reply | Private Reply | To 6 | View Replies]

To: K-oneTexas

I guess the lack of refineries is the biggest problem.

I personally hold to Thomas Gold’s theory on oil myself.


14 posted on 05/08/2008 6:49:05 AM PDT by Sybeck1 (It's truly bad when your Savior in November is Judas Himself.)
[ Post Reply | Private Reply | To 1 | View Replies]

Comment #15 Removed by Moderator

To: Dick Bachert
Agreed.

Imagine: If our great grandparents had taken the same attitude toward coal in the 1800’s, there would have been no industrial revolution. We would still be driving horse and buggies and burning whale oil lamps.

16 posted on 05/08/2008 6:54:15 AM PDT by woodbutcher
[ Post Reply | Private Reply | To 13 | View Replies]

To: K-oneTexas
As I understand it, there are two grades of oil ... sweet and (sour?) ... and the sweet is supposed to be the better, less expensive and the easiest to refine, the 'sour', not so much.

So, I think I remember we desire ME oil because it is the sweet kind.

That being said ... how much of all of this oil is sweet, and where is it ... and how much is the 'sour' ?

17 posted on 05/08/2008 6:55:59 AM PDT by knarf (I say things that are true ... I have no proof ... but they're true.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: K-oneTexas
My Energy Manifesto:

* Cease all ethanol production. It requires more energy to make than it yields and the unintended consequence is higher food costs. Corn production shifted from feed-corn to subsidized corn for ethanol. Just say "no" to ethanol!

* Immediately create only ONE "blend" of gasoline and cease regional blends which are stupid, costly, and meaningless. Even if this is the "cleanest" blend, just make it ONE and be done with it. Trucking custom blends around the country is wasteful.

* Drill for oil in Alaska, Gulf of Mexico, and other sites in the CONUS as a matter of national security.

* Construct state-of-the-art refineries and/or retrofit current and dormant ones and crank up production.

* Make all “carbon credit” scams unlawful.

* Construct SEVERAL, regional Pebble-Bed Reactors (or other similar designs) that are not considered "breeders", are rechargeable, and cleaner than any current nuclear generator design.

* Use the residual heat from the reactor above to process motor fuel from coal and/or shale. Even though Clinton "stole" some of the best coal reserves, we still have a lot to use.

* Become independent enough to make the cartels (i.e. OPEC) inconsequential.

* Convince local taxing bodies to lift or cap the sales tax on gasoline so that as gas prices go up, the local tax collectors don’t see a windfall revenue jump at the expense of the consumer. The Federal government could compel the states (and locals) to cap the fuel taxes.

18 posted on 05/08/2008 6:56:54 AM PDT by SERKIT ("Blazing Saddles" explains it all.....)
[ Post Reply | Private Reply | To 1 | View Replies]

To: K-oneTexas
The article is based on self-serving propaganda put out by the American Petroleum Institute. The reality is that there will be an increasing imbalance between the available supply of petroleum and demand. Regardless of whether big new oil fields are found, the older fields’ production will decline (Cantarel in Mexico is down by over 500,000 barrels per day year to year) and more than offset any new production.

Our congress is incapable of addressing this problem.

19 posted on 05/08/2008 6:59:18 AM PDT by trane250
[ Post Reply | Private Reply | To 1 | View Replies]

To: Dick Bachert

OK, here’s something I don’t quite understand. The enviro-weenies have basically stopped all commercial nuclear power plant construction. But they HAVEN’T stopped military power plant production.

Why can’t we use the military version of a nuclear power plant to produce hydrogen for fuel cells?


20 posted on 05/08/2008 7:00:11 AM PDT by Bryan24 (When in doubt, move to the right..........)
[ Post Reply | Private Reply | To 13 | View Replies]


Navigation: use the links below to view more comments.
first 1-2021-4041-6061-80 ... 101-118 next last

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.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson