Posted on 05/13/2012 7:36:35 PM PDT by Ernest_at_the_Beach
In case you missed it – and you very well might have, since the media was too busy talking about gay marriage to be bothered – a rather remarkable thing happened in Washington this week. An auditor from the GAO testified before the House Science Subcommittee on Energy and Environment on the subject of energy. But instead of hearing about how horrible things are, she calmly delivered something of a bombshell.
“The Green River Formation–an assemblage of over 1,000 feet of sedimentary rocks that lie beneath parts of Colorado, Utah, and Wyoming–contains the world’s largest deposits of oil shale,”Anu K. Mittal, the GAO’s director of natural resources and environment said in written testimony submitted to the House Science Subcommittee on Energy and Environment.
“USGS estimates that the Green River Formation contains about 3 trillion barrels of oil, and about half of this may be recoverable, depending on available technology and economic conditions,” Mittal testified.
“The Rand Corporation, a nonprofit research organization, estimates that 30 to 60 percent of the oil shale in the Green River Formation can be recovered,” Mittal told the subcommittee. “At the midpoint of this estimate, almost half of the 3 trillion barrels of oil would be recoverable. This is an amount about equal to the entire world’s proven oil reserves.”
Read those last two sentences again and think about it for a moment. The largest remaining reserves of oil on the planet are not in Saudi Arabia or buried under the frozen steppes of the former Soviet Union. They’re here in the United States. Combined with the massive resources in western Canada, that means that North America is the King of Oil for the future. But what – if anything – will we do about it?
The vast majority of this supply is shale oil, a form which was essentially useless to us only a few decades ago, but now we know how to get it. And if you want to avoid ripping up the entire landscape, that means horizontal drilling and fracking. Unfortunately for us, this is one of those rare areas where the government actually can make a difference, for better or worse. The Obama administration continues to claim that they are pursuing an “all of the above” energy policy, but at the same time they are jumping in with new regulations regarding fracking.
If we move forward on this aggressively, the industry can safely access these resources which would significantly strengthen our hand on the international stage. But with the wrong approach, Washington could hog tie energy developers with excessive, expensive regulations or shut the entire process down by failing to issue permits to develop resources on these federal lands.
The public disclosure of these reserves is good news, but it’s only the beginning. And while I feel some trepidation in saying it, I’m afraid the ball is in Barack Obama’s court.
It did not fail for that reason, it was strictly economics. The Parachute CO project was going full blast ahead when oil was around $40.00 a bbl. IMO the project scared the living hell out of OPEC, the price of oil dropped to around $9.00 bbl. Blam and damn, oil shale was no longer profitably viable, end of story.
Shell always said it was commercial if the price of oil got above $50 a barrel. When it went well above that, Shell started tooling up to expand their pilot operation. Thats when the government shut them down.
If there is no way for it to be commercial, then no need for the government to shut them down.
In Utah a consortium of investors were developing an operation on private land, and the government shut that down too.
The politician who took charge of shutting it down was O’s pick to head up the Department of the Interior. So thats where that stands.
There are other countries going after their oil shale, Brazil, Argentina, Jordan signed a $20 billion dollar contract with Shell to develop theirs. For what its worth, Estonia generates 100% of its electricity burning oil shale like coal. The waste goes on their road beds.
The problem is that it has to be commercially viable, that is it has to compete with the price of oil from other sources. If it costs $200 per barrel to produce and the current oil price is $100 you can only lose money by doing it becuse no one will be standing in line to buy your $200 oil.
I am in the oil business and I know plenty of places that I could go drill a well, be it a very low volume, and produce it at a $200 per barrel cost, but I am sane.
Maybe someday when all the oil from other sources is gone it will work.
“Shell always said it was commercial if the price of oil got above $50 a barrel”
Historically because the price of energy and other costs have gone up with the price of oil the costs to produce kerogen have gone up with it so it is a moving target. I don’t know what the current cost would be, but I am quite sure it is way above $50.
As one well known geologist once said, “ oil shale is the oil of the future and aways will be. “
It was only a couple of years ago. The price was above $75 or $80 at the time.
I agree with your remark that the $50 is a moving target. But, again, if it can never be commercially viable, no need to shut it down legally. I notice driving through the area a lot of drilling rigs. I assume they are exploring, to nail down exactly where the deposits are. In the current political climate, its a dead issue. But someone is doing a lot of exploring.
Ah, Wamsutter, WY, land of the Red Desert and Continental Divide. I spent six years (1980-86) there as a Marathon Oil Co supervisor, before getting transferred to Bakersfield, CA.
There were more murders in the tiny town during that six years than I can recall. When I first got there, all the pumpers were carrying weapons in the company vehicles, which I decided to stop. Within just a few weeks, I ate crow and told the pumpers they could get their guns back in the co. trucks.
Sweetwater County sheriff’s dept. told me that stretch of I-80 was the most dangerous piece of highway in the nation, said the prairie around there was full of unmarked graves. In winter when the lease roads would often drift shut, one pumper would take a ridge route to reach some wells. He remarked one day that he had hit a bump he never had before, spring revealed he had been driving over a body for most of the winter. The sheep herder who found the body was Basque and spoke no English, he was half insane trying to describe what he had found.
Happiness for me was seeing Wamsutter in the rear view mirror the day got transferred.
The shale oil there is actually kerogen sediment. (does kerosene link ring a bell?)
Kerosene was first retorted from kerogen in the mid 1800’s from deposits in New Brusnwick, Ontario and Nova Scotia.
There are other conventional oil and gas producing formations in the area and that is probably the explaination for most of the drilling activity you are seeing although some may be wells just to tie down the exact dimensions of the Green River Formation.
I am not familiar with the geology of the area, but as in all oil producing areas there are layers of different types of sedimentary rock on top of each other, some containing commercial quanities of oil and gas and some not. The Green River formation is just one of the layers.
And the key word is “thousands.” Kerogen in nature converts to oil under sufficient pressure and temperature. There is a temperature gradient as depth increases, using present horizontal drilling and fracking technology shale oil is now being produced around the world.
If in-situ heat was introduced at depths where the richest deposits are located and temperatures are already moderately high. It would not take that much to artificially tip the scales and create the process.
At the present time, getting at the oil would mean strip mining most of the western half of Wyoming, as well as large sections of Colorado and Utah.
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No strip mining needed. Oil bearing rock is first melted underground to make it liquid and then piped to the surface.The process of doing this is called insitu. Its also relatively cheap.
http://en.wikipedia.org/wiki/Oil_shale
In 2005, Royal Dutch Shell announced that its in-situ process could become competitive for oil prices over $30 per barrel ($190/m3).[56] A 2004 report by the United States Department of Energy stated that both the Shell technology and technology used in the Stuart Oil Shale Project could be competitive at prices above $25 per barrel, and that the Viru Keemia Grupp expected full-scale production to be economical at prices above $18 per barrel ($130/m3).[46][57]
You have to be careful when you are talking about shale oil because some of it is locked up so tight in its source rock it requires heating to extract it. I believe the oil in Colorado is this sort and if so it will be very much more expensive than the shale oil being recovered in the bakken and other shale formations.
I well recall the thriving uranium mining that was being undertaken at Jeffery City, WY in the early 1980s. Things were booming until Ten Mile Island and Jane Fonda brought it all down almost overnight. I last saw Jeffery City a few years ago and it was dead and a modern ghost town.
” using present horizontal drilling and fracking technology shale oil is now being produced around the world.”
I believe you are confusing “shale oil” with “oil shale”. “Oil shale” is kerogen. “shale oil” is crude oil that occurs in tight shale formations that is now being produced with horizontal drilling and stage fracking techniques.
I am not a geologist, but I am told that most oil was formed in shales which are rich in organic material, then over millions of years the oil migrated to sandstones and fractured limestones that were more porous and therefore easier to produce. That is what is referred to now as conventional oil that has been produced since Drakes well of 1859.
Only recently have we been able to economically been able to produce from the tight shales. This is what is going on now in the Balken shale of North Dakota and Montana as wel as the Eagle Ford shale in South Texas.
The Green River formation is an entirely different animal.
Well, I guess the future is here. The oil of the “future” is being cracked today from the Texas Eagleford in several refineries here in Texas.
Although it is proving to be a challenge since it is a lighter crude and coking over equipment resulting in more turn arounds.
Also old time process operators are having to relearn and change their operating parameters and companies are having to retrofit equipment (add preheaters), it is being done.
“Well, I guess the future is here. The oil of the “future” is being cracked today from the Texas Eagleford in several refineries here in Texas.”
Listen carefully and I will repeat. The Eagleford shale oil is not the same thing as the kerogen found in the Green River formation.
Fracking is already saving the entire U.S. economy. Watch and see.
I wish they would just drop the terms “shale oil” and “oil shale. “ it creates so much confusion, even I am confused sometimes and I understand the difference,
They should just refer to it as crude oil or kerogen depending on which it is.
getting at the oil would mean strip mining most of the western half of Wyoming, as well as large sections of Colorado and Utah
You’re going to have to present some facts as to why this shale would have to be strip mined. You mine sands not shale. There have been over 3,000 wells drilled in the basin and no mining that I am aware of.
There are real concerns in dealing with the water table and other issues in the extraction process, but technology will eventually overcome these concerns.
“Fracking is already saving the entire U.S. economy. Watch and see.”
I agree, especially for natural gas production, but the wackos are doing their damnedest to shut it down.
I stand corrected on the surface mining portion of my post. I did some research on it and found that it is one of the methods of extraction for shale as well as sand formations.
I did find that in the case of Green River Basin drilling and injecting heat seems to be the method of extraction.
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