Oil sands, oil shale, and other unconventional petroleum sources
It's Domestic Energy, Stupid!
We need to develop all of our domestic energy resources, none to the exclusion of any other source —
nuclear, clean coal, oil, natural gas, wind, solar, heck, maybe even switch grass. And while it is true
that we can't get all of our energy needs from domestic sources, it doesn't mean we shouldn't get any of it
here. We've got a lot — in ANWR, in the Outer Continental Shelf, and in the oil shale out
West. How about subsidizing shale oil extraction with the billions we currently subsidize ethanol
and other biofuels with?
The Energy Quagmire: Extracting
oil from shale rock only recently has become economically feasible. It costs about $70 per barrel to extract
and make the oil usable. When oil was $18 a barrel that would have been crazy. But at $138 a barrel,
it's a bargain. And American companies can make money by supplying our nation's need, and lowering costs
for all of us in the process.
Harry Reid Sneaks in Oil
Shale Ban. Leave it to Senator Majority Leader Harry Reid to crash the Energy Freedom party.
Not only is he crashing the party, he's doing so through the side door where he thinks no one can see him.
Just when it appeared that we could celebrate Congress lifting the ban on oil shale, Senator Reid "has decided
to sneak an extension of the oil shale ban through as Congress fights over the financial bailout."
Despite 800 billion barrel potential, oil shale a hard
sell. Democrats have barred the Bureau of Land Management from leasing any federal land for commercial-scale
oil shale projects. And whether a nation now focused on boosting use of renewables and lowering dependence on fossil
fuels will give oil shale another look remains an open question.
Oil shale to the rescue.
[Scroll down] Most of the U.S. share, [Paul] Roberts also writes, can be found in the Green River Formation,
which stretches through Colorado, Utah and Wyoming, and which has recoverable oil that is three
times — yes, three times — the proven reserves of Saudi Arabia. Given that the oil shale
is so close at hand, it's no surprise that researchers at the school have been studying it for decades,
or that there is now intense interest in the subject at the Colorado Energy Research Institute located
at the school.
Developing oil shale is the best
choice. Democrats control Congress, so Americans ought to be asking about their plan to lower
gas prices. Let's hope their plan doesn't rest on solar, wind and geothermal, because planes, trains
and automobiles don't run on electricity. They run on oil — mostly foreign oil —
97 percent of the time. Let's also hope the Democrats' plan doesn't rest on ethanol to break our
dependence on foreign oil, because it can't.
Crude Mistake: Congress [has
shown] once again how clueless it is when it comes to energy policy. Underscoring its failure to grasp the nature of
our current problems, the Senate Appropriations Committee on Friday [5/16/2008] refused to end its moratorium on oil shale
development in Colorado. … Congress could reduce much of our oil shortfall by drilling for more on our own territory.
This would lower prices and increase security. Yet, Congress seems dead set on doing the opposite.
4.3
billion barrels of oil likely in Bakken. The government estimates up to 4.3 billion barrels
of oil can be recovered from the Bakken shake formation in North Dakota and Montana, using current technology.
The U.S. Geological Survey calls it the largest continuous oil accumulation it has ever assessed.
Huge Oil Reservoir May Lie Under Northern
Plains. The government estimates up to 4.3 billion barrels of oil can be recovered from the
Bakken shale formation in North Dakota and Montana, using current technology. The U.S. Geological Survey
calls it the largest continuous oil accumulation it has ever assessed. An assessment by USGS in 1999
found the Alaska National Wildlife Refuge had 10.3 billion barrels of recoverable oil, said Brenda
Pierce, a geologist for the agency.
Norway makes $2.2B investment in Canada's
oilsands. A firm owned by the Norwegian government has paid $2.2 billion to acquire
Calgary-based North American Oil Sands Corp. Statoil ASA is offering $20 a share for the private
company, for a total price of $2.2 billion.
Environmental toll from oilsands
is a "myth": Stelmach to U.S.. Alberta Premier Ed Stelmach is asking business leaders in
the United States not to buy the notion that oilsands production comes at too high an environmental cost.
Stelmach told an energy forum in Washington, D.C., today that although this "myth" has gained some traction in
the U.S., attempts to slow down oilsands development "don't make sense."
Ethanol
isn't worth getting pumped up about, but oil shale might be. Winter is barely behind us, and
gasoline prices are already rising. Worse, experts predict more price increases are right down the
road. This poses two problems. First, higher energy prices mean families have less to spend on
other necessities. Second, most of the money we spend for fuel ends up overseas, often supporting
countries that don't wish us well. To solve the first problem, we need to solve the second.
Klein wants oilsands processed
in Alberta. In the face of criticism that Alberta is losing money by allowing raw product from
the oilsands to be shipped to the United States for upgrading, Premier Ralph Klein says he's asked his energy
minister to review the issue. …Klein said he's specifically concerned about a plan by oil giant EnCana
Corp. to ship bitumen south of the border, as well as a proposed pipeline that would take bitumen from
Fort McMurray to British Columbia for shipment to China.
Chavez
gives boost to oil sands. The re-election of Hugo Chavez as President of Venezuela for a second
term this week means the world should get ready for another six years of sabre-rattling aimed at keeping oil
prices high.
Huge oilsands
potential still untapped, says energy official. Oilsands projects in northern Alberta may be
booming but the province's energy regulator said Thursday [6/15/2006] that only the surface has been scratched
so far. The Alberta Energy and Utilities Board said less than three percent of the province's
established oilsands reserves have been developed in 40 years of work. In its annual report on
Alberta's reserves, presented at the Calgary Chamber of Commerce, the board says there are still an estimated
1.6 billion barrels of conventional oil in the ground and 174 billion in the oilsands.
Oilsands
to the rescue. Yesterday [4/12/2006], the U.S. Department of Energy reported a big drop in
gasoline inventories. And it's still only April. Blame steady world oil demand growth,
only modest increases in spare oil production and more risks of political instability. Combined,
they are "expected to keep crude oil prices high through 2006."
Oil Sand Becoming More Economical. It
was a tenet of the late, great economist Julian Simon that we'll never run out of any commodity.
That's because before we do, the increasing scarcity of that resource will drive up the price and force
us to adopt alternatives. For example, as firewood grew scarce, people turned to coal, and as the
whale oil supply dwindled, 'twas petroleum that saved the whales.
Fill 'er
Up with Oils Sands! Now we're told we're running out of petroleum. The "proof" is
the high prices at the pump. In fact, oil cost about 50% more per barrel in 1979-80 than now
when adjusted for inflation. Yet it's also true that industrializing nations like China and
India are making serious demands on the world's ability to provide oil and are driving prices
up. So is this the beginning of the end? Nope. The Julian Simon effect is
already occurring.
Oil is out there, but in difficult places
Brazil Oil
Trapped by 500-Degree Heat, Salt Barrier. Tapping what may be the biggest oil finds in the
Western Hemisphere in three decades will require equipment that can withstand 18,000 pounds per square inch of
pressure, enough to crush a pickup truck, pipes that can carry oil at temperatures above 500°F. and drill
bits that can penetrate layers of salt more than one mile thick.
Brazil Oil Finds May End Reliance
on Middle East, Zeihan Says. Brazil's discoveries of what may be two of the world's three biggest
oil finds in the past 30 years could help end the Western Hemisphere's reliance on Middle East crude,
Strategic Forecasting Inc. said.
The
Shale Game: Yes, oil companies make money. But they spend more than they make on finding
new sources of oil. A new Ernst & Young study shows the five major oil companies had $765 billion of new
investment from 1992 to 2006 compared with net income of $662 billion. Over the same stretch, the
industry — which includes 57 of the largest U.S. oil and natural gas companies — had new
investments of $1.25 trillion compared with a net income of $900 billion and a cash flow of $1.77 trillion.
This is an industry that has redefined innovation, reinvesting profits to find innovative ways to recover oil and gas wherever
they find it.
Japan's Arctic methane hydrate
haul raises environment fears. For an unprecedented six straight days, a state-backed drilling
company has managed to extract industrial quantities of natural gas from underground sources of methane
hydrate — a form of gas-rich ice once thought to exist only on the moons of Saturn. In fact,
the seabeds around the Japanese coast turn out to conceal massive deposits of the elusive sorbet-like compound
in their depths, and a country that has long assumed it had virtually no fossil fuels could now be sitting on
energy reserves containing 100 years' fuel.
Brazil Oil Find May Be World's
3rd Largest. A deep-water exploration area off Brazil's coast could contain as much as
33 billion barrels of oil, the head of Brazil's National Petroleum Agency said Monday [4/14/2008].
That would make it the world's third-largest known oil reserve. Haroldo Lima cautioned that his
information on the field off the coast of Rio de Janeiro is unofficial and needs to be confirmed.
Colombia
is sitting on big oil reserves. Colombia's heavy oil area could hold 20bn barrels of recoverable
resources, giving the country greater reserves than leading producers such as Mexico and Algeria, said its
natural resources agency. Foreign investment in Colombia's oil and gas industry is booming, and the country
hopes to lift oil production to 1m barrels a day in the next decade, from about 550,000 b/d currently.
Oil in or near the Arctic Circle
U.S.
ship heads for Arctic to define territory. A U.S. Coast Guard cutter will embark on an
Arctic voyage this week to determine the extent of the continental shelf north of Alaska and map the
ocean floor, data that could be used for oil and natural gas exploration.
Russia
threatens to seize swathe of Arctic. President Dmitry Medvedev said that Russia should
unilaterally claim part of the Arctic, stepping up the race for the disputed energy-rich region. "We
must finalise and adopt a federal law on the southern border of Russia's Arctic zone," Mr Medvedev told a
meeting of the Security Council, in remarks carried by Interfax news agency.
Hunting for
oil beneath the ice: The combination of falling reserves and $100-plus oil is sparking a frenzy of oil and gas
activity in Alaska the likes of which hasn't been seen since the state's initial oil boom more than three decades ago.
ConocoPhillips, Alaska's biggest producer and America's third-largest oil company, is spending huge sums to re-explore old
stomping grounds like the North Slope. The company is also investing in heavy-oil technology and early preparation
for a proposed $30 billion natural gas pipeline.
U.S. pushes to expand Arctic
icebreaker fleet. A growing array of American military leaders, Arctic experts and lawmakers
say the United States is losing its ability to patrol and safeguard Arctic waters even as climate change and
high energy prices have triggered a burst of shipping and oil and gas exploration in the thawing region.
Bias alert:
Who says the region is "thawing?" Looks normal to me. (See charts
on this page.)
Kremlin lays claim to huge chunk of
oil-rich North Pole. Under international law, no country owns the North Pole. Instead, the
five surrounding Arctic states, Russia, the US, Canada, Norway and Denmark (via Greenland), are limited
to a 200-mile economic zone around their coasts.
Russia gears up to develop vast oil
reserves. President Dmitry Medvedev signed a law today [7/18/2008] enabling the Kremlin to
handpick companies to develop the vast oil reserves believed to be located in the Russian Arctic.
Arctic May Hold
90 Billion Barrels of Oil, U.S. Says. The Arctic may hold 90 billion barrels of oil, more than
all the known reserves of Nigeria, Kazakhstan and Mexico combined, and enough to supply U.S. demand for
12 years, the U.S. Geological Survey said. One-third of the undiscovered oil is in Alaskan
territory, the agency found in a study released today [7/23/2008].
Oil
Survey Says Arctic Has Riches. The Arctic may contain as much as a fifth of the world's yet
to-be-discovered oil and natural gas reserves, the United States Geological Survey said Wednesday [7/23/2008]
as it unveiled the largest-ever survey of petroleum resources north of the Arctic Circle.
More oil and gas found in North Sea.
Norwegian exploration activity in the North Sea has yielded a new oil well and the discovery of what's being
called a "large" pocket of gas. StatoilHydro logged its fourth oil discovery of the year, just southwest
of the Grane field in the Norwegian sector of the North Sea. It's estimated to yield as many of [sic]
30 million barrels of crude.
Greenland opening Arctic sea to oil wells. Several
of the world's largest oil companies hope to tap into possible offshore oil and gas reserves as Greenland
opened a new round of concessions for exploration licenses in the fragile Arctic region.
Riches
in the Arctic: the new oil race. The future of the Arctic will be less white wilderness,
more black gold, a new report on oil reserves in the High North has signalled this week. The
first-comprehensive assessment of oil and gas resources north of the Arctic Circle, carried out by
American geologists, reveals that underneath the ice, the region may contain as much as a fifth of
the world's undiscovered yet recoverable oil and natural gas reserves.
Map
shows front lines of Arctic carve-up. A new map of the Arctic outlines what will undoubtedly be
the decade's biggest geographical carve-up between nations. "The map is the most precise depiction yet
of the limits and the future dividing lines that could be drawn across the Arctic region," says Martin Pratt,
director of research at the University of Durham's International Boundaries Research Unit.
Positive and negative effects of oil price fluctuations
Positive
Texas Economy Booming Under Oil
Rush. A segment on "NBC Nightly News" showed how the price of oil — a little
over $137 a barrel — is reviving the economy in parts of Texas that have long been dormant.
"Ask people in Texas about the economy and they're likely to gush," CNBC senior correspondent Scott Cohn said
on "Nightly News." "Matt Levisor is making big money refurbishing these west Texas oil
wells — abandoned back when oil was cheap."
North Dakota's real-life
Jed Clampett: It's not uncommon to hear stories of 20-year-olds with no job experience getting
hired to work in the oil fields with starting salaries of $70,000 a year. Gary Dazell makes more than
$100,000 a year hauling water to and from the oil fields. "The oil field has blessed us," he says.
Then, there are stories like [Herb] Geving's where locals suddenly come into a fortune for owning the mineral
rights. Geving says he's amassed so much money that 70 relatives will get sizable sums when he dies.
Drill Like Texas. The
invisible hand of the marketplace is alive and well in Texas. Over the past 12 months Texas has
created 245,000 jobs. That accounts for more than half of the jobs created in America during that
time. Not coincidentally, Texas has the second lowest tax burden of the 50 states. Even
conservative estimates have projected a $10 billion surplus for the next biennium. Texas also
leads the nation in energy production — 30% of the natural gas and 20% of oil produced in America
comes from Texas.
Oil industry battles for
skilled workers. As oil and gas prices continue to break records, the U.S. energy industry
is flush with cash, helping Texas add 245,000 jobs in the past 12 months while job growth nationally
was flat. But what's eating the industry is a shortage of skilled workers so severe it's threatening
to slow projects and force companies to turn away work.
Pension
Funds Boosted By Oil. Soaring fuel prices that are burning a hole in the wallets of consumers are
not only benefiting oil companies and Middle Eastern producers. They are also lighting up the investment
returns of pensions funds, which millions of ordinary Americans are counting on for their retirement.
As
Oil Rises in Markets, Rigs Rise in Mississippi. The high price of oil, hovering around $70 a
barrel, has brought a nearly dormant Mississippi petroleum industry roaring to life. Wells abandoned
long ago by the major oil companies are being reopened by independent operators. Requests for new
drilling permits have spiked. Trainees for oil-field work can make nearly $14 an hour. Companies
wait 12 months to rent the kind of field equipment that was once sold for scrap.
Ohio Considers New Wells, Looks to
Alaska Example. Ohio Senate Bill 193, would allow oil and gas drilling and commercial
logging in state-owned parks, wilderness areas, and game lands. Supporters say the drilling
would increase natural gas production in the state, increase local supply, and lead to lower prices
for local consumers. It also would bring royalties to the state.
Abandoned oil wells
uncapped. Oil wells in California that were capped are now being opened because
rising petroleum demand and new technology are permitting oil companies to profitably extract
oil in the Golden State.
Gas Rush Is On, and
Louisianians Cash In. A no-holds-barred, all-American gold rush for natural gas is under way in
this forgotten corner of the South, and De Soto Parish, with its fat check from a large energy company this
month, is only the latest and largest beneficiary.
West Texans jaded instead of giddy during
this oil boom. The people of Kermit and other Permian Basin towns have learned that petroleum-based
prosperity is too fragile to squander in wild exuberance. They're paying off debts and investing in public
institutions that will endure beyond the boom-and-bust cycles of the oil business.
Global political hypocrisy:
Norway, which now has the highest, or closest to the highest, per capita income on the planet due to its immense
oil reserves and relatively small population, has decided to beat up on a number of poorer countries that do
not have the luck to sit on a vast pool of oil.
Surge
for the dollar as global fears rise. The dollar surged to a two-year high against the
pound and a six-month peak against the euro on Friday [8/15/2008], as fears about spreading economic
gloom triggered a sell-off in commodities. Against sterling, the US currency notched up its
11th consecutive day of gains — its longest uninterrupted rise in more than 35 years — as
markets became increasingly convinced that the US was best-placed to weather the global downturn.
Gold plummets amid
stronger dollar, oil decline. Gold, which scorched into the record books earlier this
year, has suddenly gone cold. Prices for the precious metal — which touched $1,000 an ounce
for the first time in March — have plunged in recent weeks, and on Friday tumbled below $800 for
the first time since late last year.
Negative
Stocks fall
sharply on surge in oil, jobs data. Wall Street tumbled Friday [6/6/2008], taking the Dow Jones industrials
down nearly 400 points, on a pair of alarming economic developments: oil prices that shot up by more than $11 a barrel and
approached $140 for the first time, and the biggest gain in the government's unemployment reading in more than 20 years.
Stimulus
Unlikely to Counter Rise in Oil Prices. Just at the moment the U.S. economy could use a boost,
the recent surge in oil prices is having the opposite effect. … The more-than-$30-a-barrel increase in oil
prices over the past five months is like a $150 billion tax increase, said William D. Nordhaus, a
Yale University economics professor. By paying more for oil, Americans have less left to save or
spend. "It is clearly contractionary," Nordhaus said.
Neither / Both
All that glistens is gold
at $1000 an ounce. Gold surged to a record high overnight [10/27/2008], nearing $1000 an ounce
as investors were spurred by a plummeting dollar, oil's initial rally and speculation there will be further US
rate cuts. … Silver also rallied to its loftiest level since November 1980, palladium jumped to a
6½ year high and platinum advanced to trade near last week's record highs before paring gains.
Oil boom creates
millionaires and animosity in North Dakota. From the cab of his combine 10 feet off the
ground, Doug Kinnoin sees acres of barley scrawnier than last year's bumper crop but good enough to fetch
top dollar as malt for beer instead of cattle feed. What he can't see, as the amber stalks give way
to the combine's rollers, is the black gold 2 miles below.
Supply and demand
We Can
Lower Oil Prices Now. Unlike perishable agricultural products, oil can be stored in the ground.
So when will an owner of oil reduce production or increase inventories instead of selling his oil and converting
the proceeds into investible cash? A simplified answer is that he will keep the oil in the ground if its
price is expected to rise faster than the interest rate that could be earned on the money obtained from
selling the oil. The actual price of oil may rise faster or slower than is expected, but the
decision to sell (or hold) the oil depends on the expected price rise.
Energy? Here's
the drill. The law of supply and demand is the oldest and wisest axiom in free-market economics. Exceed
the demand for something by overproduction and the price will fall. Sharply reduce its supply in the face of very
robust demand, and the price will go up. Congress, well-meaning environmentalists, government regulators and assorted
Malthusians seem to have forgotten this simple, fundamental rule, and the result is $120-a barrel-oil and $4-a-gallon
gasoline.
Biggest drop in U.S. oil demand in
26 years. U.S. oil demand during the first half of 2008 fell by an average 800,000 barrels
per day (bpd) compared with the same period a year ago, the biggest volume decline in 26 years, the
Energy Information Administration said on Tuesday [8/12/2008].
The
new math of oil: We're hard-wired to tremble when oil prices rocket, and the past few weeks have
looked like another example of why. Whenever stocks fell sharply, as they did several times, traders
blamed the fast-rising price of oil. But that chain of logic is misleading. The bigger picture
shows that the relation between oil and the economy is changing, and we'll have to rewire our brains to
understand what's happening. Watching oil prices rise and fall is no longer enough; the key now is
understanding why they're moving.
Oil Price
Defies Easy Calculation. Is there a fair price for oil? It doesn't seem that way. Over the
past year, the price of crude oil has nearly doubled even though oil inventories are ample, there has been no
disruption in supplies, and petroleum demand in the United States, the world's biggest consumer, has leveled
off in recent weeks as the economy has slowed.
IEA sees
oil supply crunch looming. World oil demand will rise faster than expected to 2012 while
production lags, leading to a supply crunch, the International Energy Agency said on Monday. In its
Medium-Term Oil Market Report, the adviser to 26 industrialized countries said demand will rise by an
average 2.2 percent a year between 2007 and 2012, up from a previous medium-term forecast
of 2 percent.
Bush's
Bogus Cure for Oil Addiction. The notion that reducing oil imports will reduce our vulnerability
is an illusion. Even by the most optimistic predictions, we will be running much of our economy with oil
for decades to come, and where that oil comes from is largely irrelevant. Why? Because oil trades
in a world market, and when disruptions occur, the price rises everywhere.
It's called
supply and demand. We Americans pay far less for fuel than most folks around the world,
especially when compared to European urbanites, some of whom pay more than $10 per gallon. And even at
$75 per barrel, oil is still $12 less than its inflation-adjusted record price in 1981. But higher fuel
prices do put the pinch on some family budgets, especially when a breadwinner has a long commute.
Helping America
achieve energy independence. Contrary to what you might hear on the evening news, oil companies
don't set the price of oil, they "take" the price the market will bear. As long as the growing global
demand for more than 83 million barrels per day keeps upward pressure on a global supply of about the
same 83 million barrels per day — the price of oil and therefore gasoline will continue to be high
and volatile.
China's
engine starts to sputter: Revved up by years of supercharged foreign investment, China's
economic engine is sputtering from lack of power this summer. An acute energy shortage has idled
the nation's factories three days a week, forced workers to take leaves and dimmed streetlights in the
big cities.
China's thirst for oil grows
despite surge in world prices. In a few short years, China has grown into the world's
Number 3 oil importer, depending on foreign crude to fuel its factories and cars and cool its shopping
malls. Even as world oil prices surge past $45 a barrel and South Korea and other Asian
economies struggle to cope with the rising cost, China's consumption shows no sign of slowing.
China's S.P.R. Pumping Up Prices.
Although the U.S. has quit filling its strategic petroleum reserve, China continues to fill its new one, yet another
reason why world oil prices have risen dramatically over the past few months. Of course, quantifying that
effect in terms of dollars per barrel is difficult, if not impossible. That said, the cost of filling China's
S.P.R. and the lack of transparency with regard to its S.P.R. program management are cause for concern.
Broader energy issues
Texas getting a floating oil port.
As politicians continue to debate how to reduce U.S. dependency on foreign oil, a Houston partnership is spending
$2 billion to prepare for an energy future that inevitably will include oil imports. The team
announced today [8/18/2008] that it plans to build and operate an oil terminal 36 miles off the coast of
Freeport.
Inanities of 'Energy
Independence'. It's amazing how ideas with no merit become popular merely because they sound
good. Most every politician and pundit says "energy independence" is a great idea. Presidents
have promised it for 35 years. Wouldn't it be wonderful if we were self-sufficient, protected
from high prices, supply disruptions, and political machinations? The hitch is that even if America
were energy independent, it would be protected from none of those things.
Foreign Oil is Still Cheap Oil.
[President] Bush never explains how buying oil from countries "that simply don't like us" hurts our
economy. The price for oil is the same for everybody on the world market. … We buy foreign oil
because, even at today's prices, it is the least expensive way to power our automobiles. How does
switching to more expensive ethanol or battery power help our economy? Bush never says.
Oil Now and Oil Tomorrow. You cannot
"conserve" energy by simply not using it or using less. The ultimate "conservation" would be to stop
mining coal and stop drilling for oil and natural gas. The modern world runs on these sources of
energy. Cutting back on their use means less electricity, less fuel for automobiles, trucks, and
planes. The United States is a powerful economic machine because that machine runs on energy.
The Facts on
Halliburton: Why do leftists demonize Halliburton? What proof exists of
their claims of corruption? What exactly has Halliburton done to profit from American
military casualties? Indeed, have they profited from military casualties? Is there
a special relationship between the Bush administration and Halliburton so that the company
receives contracts without observing the normal bidding process? It is certainly true
that during a two year period Halliburton's revenue from Defense Department contracts
doubled. However, that increase in revenue occurred from 1998 to
2000 - during the Clinton administration.
The Editor says... Halliburton wins
contracts for oil field work in the Middle East for the same reason that AT&T
won the classified contract to operate the AUTOVON
system.* They
have the specialized equipment and the trained, experienced people to do the job, and they can get started
today, if necessary. It is a waste of time and effort to shop around for small, minority-owned, or
"disadvantaged" businesses when there are huge, urgent and highly specialized projects at hand.
Editor's note:
In an attempt to combat high gas prices, you may be tempted to purchase a hybrid vehicle. But before
you do, you should look at the information
on this page.
