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July 4, 2008 at 1:21 am #3549
The U.S.’ Untapped Oil Bounty
There’s enough oil to power the nation for three centuries without OPEC’s help — IF we’re willing to go after it.
By Jim Ostroff, Associate Editor, The Kiplinger Letter June 30, 2008
Think the U.S. is running out of oil? Think again. What is running low, given soaring demand for energy worldwide, is oil in fields that have already been tapped and are in production — in other words, the relatively easy-to-get stuff, which oil companies have proven exists and can get at with current technology. Those reserves are clearly being drained. The U.S. has around 20 billion barrels now, down from nearly 29 billion barrels a decade ago and about half the 1970 peak of 39 billion barrels. But…
The U.S. is sitting on the world’s largest, untapped oil reserves — reservoirs which energy experts know exist, but which have not yet been tapped and may not be attainable with current technology. In fact, such untapped reserves are estimated at about 2.3 trillion barrels, nearly three times more than the reserves held by Organization of Petroleum Exporting Countries (OPEC) nations and sufficient to meet 300 years of demand — at today’s levels — for auto, truck, aircraft, heating and industrial fuel, without importing a single barrel of oil.
What’s the problem then? Why aren’t oil companies jumping to pump the black gold? Contrary to what some conspiracy theorists would have you believe, there is no cabal of oil companies and foreign governments blocking the way, bottling up U.S. oil production. The reality is much more mundane. Those untapped reserves are located in places that either Uncle Sam has put off-limits for environmental reasons or are too costly to get — or a combination of both.
Given current sky-high prices for crude oil and the likelihood that oil prices will remain high — at or above $100 a barrel — for the foreseeable future, it is now economically viable to tap some of those reserves. But environmental concerns — ranging from preservation of pristine lands to worries about increasing the use of fossil fuels and accelerating global climate change — remain a hurdle.
Here’s a look at some of the largest untapped reserves.
- Oil shales: Oil extracted from shale fields represents the mother lode of untapped reserves, at about 1.5 trillion barrels — or 200 years worth of supply at current usage levels. Roughly two-thirds of the U.S.’s oil shale fields in Colorado, Wyoming and Utah are in federally-protected areas and closed to development. In addition, getting the oil out of the rock is a challenge, requiring cooking or chemical treatment of rock located as much as half a mile under the earth’s surface.
- To make oil shale production economically worthwhile, crude oil prices must remain above $50 a barrel for a protracted period. Given the outlook for continued high prices, oil companies such as ExxonMobil, Royal Dutch Shell Inc., EGL Resources, Brazil’s Petrobras and others are gearing up pilot projects on nonfederal lands. The potential is to produce 1 million barrels of oil a day within a decade from lands currently open — and several times that amount if the lawmakers give the green light to development of lands now off-limits.
- Tar sands: Around 75 billion barrels of oil could come from tar sands, similar to Canadian fields, which now churn out a million barrels a day. The sands are located predominantly in Utah, Alaska, Texas and California, as well as in Alabama and Kentucky on federal and state lands that, by laws and administrative orders, are closed to mineral and petroleum development.
- The outer continental shelf (OCS): Something in the neighborhood of 90 billion barrels of oil sit beneath the ocean bed 50 to 100 miles off the Atlantic, Pacific and Gulf coasts. Presidential bans and congressional prohibitions have put the tracts off-limits to oil company exploration at least until 2012, although there’s a chance that Congress may lift the moratorium before then. In recent months, several key policymakers, including GOP presidential candidate John McCain and Florida Governor Charles Crist Jr. (R), have reversed their positions on drilling in the OCS. Crist’s change of mind may signal a new trend. Concern about potential damage to his state’s beaches and Florida’s critical tourism industry had dictated his opposition to drilling off the state’s coasts. But the state’s growing budget woes — and the prospect of capturing some cash from off-shore leasing — is proving alluring.
- The Bakken Play: With up to 100 billion barrels of oil, the reserves locked under rocks buried a mile or more beneath Montana and Saskatchewan, Canada, are more than twice the size of Alaskan’s entire oil cache. New drilling and oil recovery technologies are overcoming production obstacles and petroleum companies are rushing to stake their claims. Marathon Oil recently acquired about 200,000 acres in the area and will drill about 300 oil wells within five years. Brigham Exploration and Crescent Point Energy Trust also want a piece of the action. EOG Resources alone figures it can produce 80 million barrels of oil from its Bakken field. But It will take at least five years before the oil starts flowing in large volumes.
- The Alaska National Wildlife Refuge: About 10 billion barrels of oil are locked away here, with little possibility that federal lawmakers will open the door.
Of course, it isn’t enough to simply get at the oil in these and other U.S. reserves. Providing major new supplies to U.S. consumers also requires a significant jump in refining capacity. But existing environmental regulations and community opposition make it tough to build new refineries. The last new domestic refinery was started up in 1976. And even if the technology and political will came together to allow oil companies access to the untapped reserves, they’ll be reluctant to do so if the U.S. doesn’t also have the capacity to refine the petroleum produced.
July 8, 2008 at 11:45 am #6739
Be very careful about investing in these types of ventures. Even if the recoverable reserves are what they say they are, you must remember one thing. The monied interests who really run this world, do not want to see an energy independent US. Since the mid seventies, this oligarchy has foisted a policy of “interdependence” on the world so that no one nation can control its own destiny. Their dream is a global governance, in which they literally rule the entire world. That is why the big media, which the monied interests control never report on these fields. Instead they tell us that the US has no substantial reserves and must develop alternative forms of energy. They will stop at nothing to prevent the full development of these fields. The environmental movement, which these people finance and control will soon swarm all over the Dakotas and Montana running to every judge in the land to block all attempts to develop these fields as well as pipelines and refineries. Meanwhile the vast majority of Americans are rushing home tonight to catch the next episode of American Idol or find out the latest on Madonna and A Rods affair. Lord help us.
July 8, 2008 at 12:41 pm #6738
Sorry but I dont believe in the “boogeyman” theories about global money guys controlling the world – some of it might happen due to aligned financial interest but I have never seen big ego’s with money agree on anything with any scope to it.
Most of the time the media is just being the liberal media – and they leave out stories that dont support thier views that is why spreading the full news is so important, and the conserative media is starting to bring some balance into the perspective.
I do believe you are right about the environmental movement blocking the Montana-Dakota fields, it has happened everywhere potential new fossil fuel solutions appear. It is just part of the machinery we have to disable & you do this by exposing it to the light of day with the facts. I strongly disagree with you that majority Americans are disinterested & focused on shallow concerns ……… that is an elite way of thinking that liberal groups believe & hope to foster and it has never been true.
When you get the facts to American people & they know what is really going on, and they can see results that are damaging their childrens future – then you better stay out of the way because some major but kicking is going to happen…..and that is starting now. Congressmen & Presidential Canidates are getting pounded for not taking action & to undo sanctions blocking energy exploration. Some permits are starting to get fast tracked, and trade practices are getting a lot of heat for lopsided arrangements.
The last ‘beat up the oil companies” Congress session ended up with lot heat getting reflected back on Liberal Democrats & Environmental postions instead of the oil companies for the first time in decades!
A lot of this gets back to the problem that our elected representitives do not reflect the will of the people that put them in office. I tend to agree with statement that “Politicians are like diapers – they need to be changed regularly and for same reasons”. If you cannot think of anything yours has done to benifit your community then vote him out of office until both parties get the point.
It isnt a case of the boogeymen controlling everything – its just getting oversight back into control people instead of self serving elites who think they know best.
July 21, 2008 at 11:17 pm #6704
Bakken update – Advances in Oil pumping Technology enrich Eastern Montana
Billings Gazette 7/21/08 <See full article at link below:>
This spring, the United States Geological Survey estimated that there are 3.6 billion barrels of recoverable oil using existing technology in Montana and North Dakota portions of the Bakken formation, which also extends into Saskatchewan and Manitoba. The whole oil-producing region is known as the Williston Basin.
As if that werent tantalizing enough, a USGS geochemist estimated eight years ago that the Bakken could contain more than 400 billion barrels of oil. Match either estimate with oil selling last week at around $130 a barrel and youve got a boom on your hands.
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