Sunday, July 20, 2008

Oil everywhere but no will to drill

Consumption assumptions:
(borrowed from"Born again Redneck")

A popular belief is that consumption of crude oil products within this country has risen unabated in recent years. Evidence does not support this assumption.According to the Energy Information Administration — the federal agency that keeps track of petroleum supply, consumption and inventories — the average daily U.S. consumption of oil and products derived from oil was 18.92 million barrels per day (mdb) in 1996, and is about 20 mdb today.Over the past 12 years, our domestic consumption of oil has risen less than 1 percent a year, while our economy has expanded by 75 percent! Obviously, conservation programs in America are working.[...]While U.S. oil consumption has increased very little since 1996, the situation is quite different in other countries. In China, whose economy has grown at a 10 percent annual pace for the past three decades, daily consumption of oil has tripled from 3 mbd in 1994 to more than 9 mbd in 2008. Since last year, oil consumption in China has increased by 16 percent.In the next two decades, China’s oil consumption is expected to grow at an annual rate of 7.5 percent and India’s at 5 percent, while growth in demand from industrialized countries should be a modest 1 percent annually. However, China produces only about 3.2 mbd from domestic sources, and that volume is near the limit of their domestic capacity. It will be strategically important for China, India and other emerging economies to secure access to oil wherever they can find it.

Where do we get our oil?
Everyone has heard endlessly that the United States relies too much on imported oil. At present, America imports about 60 percent of the oil and petroleum products it consumes. Canada is the largest supplier of oil, and is currently providing about 1.8 mbd of the oil we consume. In fact, the top five exporting countries (Canada, Saudi Arabia, Mexico, Nigeria and Venezuela) account for 68 percent of our crude oil imports. Saudi Arabia’s oil fields are declining, but Canada has substantial oil reserves that will allow it to sustain a daily production of 2.7 mbd for the next 200 years. We are Canada’s largest customer for oil; more than 95 percent of Canada’s oil exports are shipped to the United States.Our crude oil imports currently total about 10 mbd, with half of that amount supplied by OPEC countries (some of whom don’t like us). Due to insufficient refinery capacity in the United States, we also import another 2 mbd of finished petroleum products such as gasoline blends, jet fuel and specialty oils for the chemical industry.[...]Recently, Chevron Oil discovered a giant reserve 175 miles off the coast of Louisiana that Daniel Yergen, chairman of the consulting firm Cambridge Energy Research Associates, calls the largest in the United States since the discovery of the Prudhoe Bay reserve in 1968. Yergen estimates that the new Chevron discovery contains as much as 15 billion barrels of recoverable oil that could provide 1 mbd or more within six years.[L]ack of resolve by Congress leaves untouched known reserves of 10.4 billion barrels of oil in Alaska’s Arctic National Wildlife Reserve that would now be delivering 1 mbd if in 1995 President Clinton had not vetoed legislation to permit drilling there.[...]Also disqualified by Congress are nonpark federal lands in the West and off our coasts that contain an estimated 112 billion barrels of recoverable oil, enough to provide gasoline for 60 million cars and fuel oil for 25 million homes for 60 years. These same off-limits lands contain an estimated 635 trillion cubic feet of natural gas, enough to meet the needs of 60 million American homes for 60 years.
With the proper leadership in Washington, we could replace most, if not all, OPEC imports with domestic oil where it is known to exist within and around our borders.

A promising domestic source
On April 10, the U.S. Geological Survey released a field report about the Bakken Formation, a large stretch of land covering parts of Montana, North Dakota and Saskatchewan. The report estimates that between 3 billion and 4.3 billion barrels of oil can be recovered from Bakken. While this new field may be less than half the size of the known oil reserves in ANWR, it is more attractive than ANWR because the Bakken Formation’s location will require less infrastructure investment to transport the crude oil to refineries.The USGS describes the Bakken Formation as the largest continuous type of oil accumulation it has ever assessed.[...]

Oil shale: the waiting bonanza
Oil shale is a rock that is rich in organic material known as kerogen. If oil shale is heated, the kerogen will yield liquid oil. The Green River Formation, which underlies large portions of Wyoming, Utah and Colorado, contains the world’s largest oil shale resource. According to the Bureau of Land Management and oil industry experts, the Green River Formation contains 800 billion to 1.2 trillion barrels of oil, more than all the recoverable oil reserves of the Middle East.
The problem with oil shale is that oil industry scientists have spent decades in unsuccessful efforts to recover the oil in an efficient and cost-effective manner.
Shell Oil may have found the key to recovery. Shell declines to get too specific about how much oil the company could extract from the Green River site, but a Department of Energy study contends that the region could sustain 2 mbd by 2020 and 3 mbd by 2050. Other government studies suggest the Green River Formation could sustain production of 5 mbd. At that level, the Green River Formation would be the largest oilfield in the world. Based on current estimates of oil reserves in the shale, the Green River Formation could provide sustainable production for hundreds of years.


Dan the Man said...

Congress needs to stay in session as long as it takes to allow for more drilling.

RhondaLue said...

The time for talk is passed. DRILL ALREADY!!!!!!!!!!!!

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