Energy Policy: Unconventional Energy Resources Posted by: McQ
on Monday, November 26, 2007
We hear (and have heard) political promises to make the US "energy independent" by x number of years coming from all the current presidential candidates. And they're also concerned with breaking the hold of foreign oil dependence. Two worthy goals - if they allow what we have already available to be exploited. And what we have available is massive:
In a massive new multivolume report on energy strategy in the United States, a high-powered federal task force puts "peak oil" into perspective. On the one hand, it says, the country has already consumed, in 150 years, 446 billion barrels of its own fossil-fuel endowment. On the other hand, it says, the country has 8.59 trillion barrels left - or more "oil equivalent" than the rest of the world combined. More than 95 per cent of America's oil reserves, in other words, are still in the ground.
Key phrase? "Oil equivalent". Wrap your head around that - "more "oil equivalent" than the rest of the world combined."
For instance - oil shale:
"North American oil shale and [oil] sands alone far exceed all the remaining proven and undiscovered oil resources of the entire world," the task force reports. "They represent 3.5 trillion barrels of oil resources. America's commercial-quality oil shale resources alone exceed two trillion barrels. This shale can be processed to generate ultraclean, high-quality diesel and jet fuels, along with high-value chemicals - with existing technologies under normal economic conditions."
But they have to be exploited.
Further, U.S. coal reserves exceed 260 billion tons - "250 years of supply at the existing production rate [for electricity] of 1.1 billion tons a year." The task force says clean coal can be the largest and quickest single new source of oil in the U.S. - and that the conversion can be economic (producing a 15-per-cent return on investment) with world oil prices between $40 to $50 (U.S.) a barrel.
Unless of course you enjoy paying at the $100 a barrel price threshold. Called "unconventional fuels" we have the following capability if we actually do what is necessary to access these resources:
The task force found the U.S. can produce between 7.65 million barrels and 9.35 million barrels a day from unconventional resources by 2035. This oil would be produced as follows: (1) from oil shale, 2.5 million barrels a day; (2) from oil sands, 0.5 million b/d; (3) from coal, 2.6 million b/d; (4) from heavy oil, 0.75 million b/d; and (5) from depleted and abandoned wells, a minimum of 1.3 million b/d and as much as three million b/d.
Taking the low numbers, that's 15.3 million b/d (18.7 million b/d with the higher numbers). Right now, domestically, we're producing 6.9 million b/d. The potential is more than twice (to almost 3 times) more than we're producing now.
The task force describes this goal as aggressive but realistic. If accomplished, it would mean that the U.S. would meet all of its anticipated increase in oil demand by 2035 from domestic production - with several million barrels a day left over to reduce oil imports significantly.
Again, the key word is "aggressive", which in political terms means "do something now". Want an energy policy which makes sense? See above. That obviously doesn't mean we should stop R&D on alternative sources. In fact, we ought to double-down. But we've been hearing about alternative sources for decades and where are we now? In a real hurt because they were always 'right around the corner', but for some reason (usually technological) we've never found that corner.
So there's your short-term/long-term energy policy. Aggressive exploitation of unconventional fuels (which, of course, means the expansion of refinery capacity as well) which will meet our probable increase in future domestic oil demand as well as a significant reduction in foreign oil imports. Meanwhile, long-term, we aggressively pursue alternative fuels/energy in an effort to develop, market and introduce alternatives which are efficient, eco-friendly and affordable so the switch to them is easy and the incentive enough to see the majority of the nation accept the change.
But the key word among key words here is "aggressive". If, as we are want to do, dither and dicker about this, we'll miss the window of opportunity. Each year we delay pushes that 2035 date further and further in the future. It is time for some presidential candidate to take the word "aggressive" to heart and push this as the market-based solution to the energy crisis. The government's job? Get on-board, clear the decks and then get out of the way.
All this, the task force concluded, can be done "urgently, immediately and responsibly in an environmentally sound and sustainable manner." Indeed, the task force concluded it must be done. The U.S. is at sufficient risk from both economic and security perspectives, it said, to warrant "aggressive development" of its fossil-fuel resources. On energy policy, the U.S. may - finally - be getting serious.
"In a real hurt because they were always ’right around the corner’, but for some reason (usually technological) we’ve never found that corner."
Economics probably played as much if not more of a role than technology. Why try to find an alternative to oil when it’s $20 a barrel? And why would anyone (whether government or private) fund research into alternatives when oil is so cheap?
And you realize coal and shale oil as an oil substitute are going to make the environmentalists howl in rage, don’t you? Although admittedly, that’s always fun to do...
Please correct me if I’m wrong, but I understood oil shale/oil sands to be economically unviable unless oil approaches the $100 dollar/barrel level—that is, the cost of processing them to retrieve the oil is high enough that’s it not profitable unless oil prices are relatively high.
One point that doesn’t get made here; who isn’t that gets to decide just what is "sustainable"?
We just got through being told, recently, about how the international organizations responsible for such things have been lying to us about AIDS. The suspicion almost immediately cropped up that AGW was being similarly "stretched". That was soon confirmed. On what basis do we make the assumption that the pronouncements of such people as regards what kind of energy policy is going to be "sustainable" has any more credibility than these?
I believe, in fact, we have much that indicates exactly the opposite ; that they will be exactly as credible. Or, more correctly as incredible)
To the point; We have been told on almost continuous basis for most of 100 years that our energy policies are not sustainable. Even leaving aside that tese are the same people who’ve been telling us about how our energy use is contributing to "global warming", it seems to me their credibility as regards what is and is not "sustainable" is severely strained, based on the length of time alone.Add to that how many times their gloom and doom forecasts have been revised another 25 year into the future, as our technology for drilling improves, and you could hardly have a less dependable source for such pronouncements.
If the idea is in fact to limit our energy use, as I suspect it is, they could hardly have engineered it better; their simultaneous insistence on both seriously limiting our domestic drilling capacity, and insisting that we "wean ourselves off foreign oil", tells me that what’s really going on here is there trying the limit our energy use altogether. I will leave it to your own fertile minds as to why they might wanna do that. But these mutually conflicting policies, have resulted in the price structure we see today. Certainly, a limit on energy use.
I note with some degree of amusement the comments regarding shale oil meeting today at $310.00 a barrel to be profitable enough to bother with. This attitude disregards the improvements in retrieval technology. It is those improvements, which kept the naysayers looking like fools these last hundred years. And to that recent finds and Brazil and in Mexico, and the projection for "unsustainability" gets pushed down the road further still.
What I am suggesting is that the free marketplace will make these determinations. Assuming, of course, that the eco-energy nazis will actually allow the free market to occur. Domestic drilling being increased would be a start. For that we need to get government out of the way. More locationally diversified refining capacity would also be a help. For that we need to get government out of the way. (how much of our energy instability is caused by refining capacity centered on tornado alley?)
It is interesting, how the solution is to get government out of the way, and yet it’s the people who center all the rebels on governmental power who are telling us that we can sustain this kind of energy use.
There’s a lesson there, I think. Getting government out of the way in terms of energy policy, really should be the goal, here. In the end, it will be the only solution possible. The question is do any of the presidential candidates actually have the stones to say such thing as aloud?
Well, don’t 2/3 of Americans believe that the recent runup in gas prices is due to Big Oil Companies(tm) colluding to rip off the public as per "Endarkenment"? Johnny Breck dovetails perfectly into a receptive market with this line.
The Canadian tar sands now give up to ~ 5% of our 15% imported oil from Canada. Their production is to increase with phase 2 in construction and phase 3 being engineered, I’ve heard, and it is about $25 per barrel to extract and process. Oil shale is estimated to be about $30 dollars to extract and process, probably more with environmental aspects considered. Even if it is higher in cost than previous energy costs, it is still less than the $99 per barrel for light crude. Shifting to a fuel cell car- hydrogen burning - would have tremendous infrastructure costs which may be one reason why propane never caught on. Coal to oil - coal oil we called it as a kid - was developed by the Germans during WWII, improved by the South Africans and has been ignored by the US in the recent past, although there are presently engineering firms designing new facilities.
I have read that 25% of the spot oil price info that we receive via the media is caused by fear and speculation. With the rapid increase in oil prices, considering that China is reportedly reducing its imports as it restructures it economy a bit, I am of the opinion that the price has a higher percentage of emotionally and speculative driven costs. Therefore, while we are seeking other massive sources of energy, congress could, if they had the long term view, vote to tap into our Alaskan and offshore oil resources. Actions speak louder than words and a movement to exploit our resources, with our much improved environmental awareness and capabilities to reduce environment damage, would cause a downward movement in oil prices. The Chinese are drilling for oil off of the Florida Keys for the Cubans. We can imagine what their desire for environmental protection is while we do not allow drilling on our side of the reserve and continue to pay some of the worse offenders of human rights billions of dollars for their oil. Fancy that.
Little has been heard about a process that uses a thermal depolymerization process (TDP) and a catalytic depolymerization process (KDV) to take waste materials apart at the molecular level and produce oil or diesel. Supposedly 85% efficient for the former and 80% efficient for the latter. Cost per barrel of oil utilizing the TDP process with free feed stock seems to be $60-$65. That does not include the savings on present waste disposal costs and the intangable environment. I found no estimate for the KDV process, but it is commercially available.
There is a functioning TDP plant in Missouri that takes turkey process waste and turns it into oil. It can turn almost any waste product into high-quality oil, pure minerals, and clean water. It applies heat and pressure, the same forces nature employed to turn ancient vegetation into fossil fuels. That plant has had problems in the past with the stench released during the process which supposedly has been corrected.
KDV operates at a lower pressure and uses a catalyst to perform the transformation for bio-diesel.
With our increasingly envionmental concerns about water table contamination from our garabge dumps, one would think that this technology would be pushed by those concerned about present energy costs and the environment. This should be the recycling effort all would applaud. But if one is worried about global warming, nuclear waste, windmills killing birds and blocking the Kennedy’s view, surfers concerned about wave power generators, nothing will be needed to be done provided we can just accept lowering our standard of living to a mere survival level, which is what the some want.
Say, aren’t we overlooking the jobs, facility, tooling and other high value economic benefits of developing our resources? With the middle east lifting oil at a reported $3.00 to tankers and sold over $90.00 there are trillions or dollars available for jobs, facilities, tools and all the things needed to use our own resources. The money that Saudi prince used to buy an Airbus super jumbo jet for a private plane has to make people wonder. I’m not very political but isn’t the "Big Oil" disease gotten way way WAY out of hand?