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Power United States

Tapping Shale Reserves, US Would Become World's Top Oil Producer By 2017 467

Hugh Pickens writes "The NY Times reports that according to a report by the International Energy Agency, the U.S. will overtake Saudi Arabia as the world's leading oil producer by about 2017, will become a net oil exporter by 2030, and will become 'all but self-sufficient' in meeting its energy needs in about two decades — a 'dramatic reversal of the trend' in most developed countries. 'The foundations of the global energy systems are shifting,' says Fatih Birol, chief economist at the Paris-based organization, which produces the annual World Energy Outlook. There are several components of the sudden shift in the world's energy supply, but the prime mover is a resurgence of oil and gas production in the United States, particularly the unlocking of new reserves of oil and gas found in shale rock. The widespread adoption of techniques like hydraulic fracturing and horizontal drilling has made those reserves much more accessible, and in the case of natural gas, resulted in a vast glut that has sent prices plunging. The agency's report was generally 'good news' for the United States says Michael A. Levi, senior fellow for energy and environment at the Council on Foreign Relations, because it highlights the nation's new sources of energy but Levi cautions that being self-sufficient does not mean that the country will be insulated from seesawing energy prices, since those oil prices are set by global markets. The message is more sobering for the planet, in terms of climate change. Although natural gas is frequently promoted for being relatively low in carbon emissions compared to oil or coal, the new global energy market could make it harder to prevent dangerous levels of warming (PDF). 'The report confirms that, given the current policies, we will blow past every safe target for emissions,' says Levi. 'This should put to rest the idea that the boom in natural gas will save us from that.'" The folks over at The Oil Drum aren't quite so optimistic: shale reserves may have an abysmal EROI. And, of course, Global Warming is a liberal myth.
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Tapping Shale Reserves, US Would Become World's Top Oil Producer By 2017

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  • "Peak Oil" (Score:5, Interesting)

    by argStyopa ( 232550 ) on Tuesday November 13, 2012 @09:09AM (#41966279) Journal

    We've heard it before, and we'll hear it again.

    "In 1975 MK Hubbert, a geoscientist working for Shell who had correctly predicted the decline in US oil production, suggested that global supplies could peak in 1995. In 1997 the petroleum geologist Colin Campbell estimated that it would happen before 2010. In 2003 the geophysicist Kenneth Deffeyes said he was "99% confident" that peak oil would occur in 2004. In 2004, the Texas tycoon T Boone Pickens predicted that "never again will we pump more than 82m barrels" per day of liquid fuels. (Average daily supply in May 2012 was 91m.) In 2005 the investment banker Matthew Simmons maintained that "Saudi Arabia ⦠cannot materially grow its oil production". (Since then its output has risen from 9m barrels a day to 10m, and it has another 1.5m in spare capacity.)" (and that's just since 1975).

    Personally, if the US has these sorts of reserves, we're idiots to tap them today. Use it as leverage to keep the Saudis pumping THEIR oil at moderate prices, and exhaust the supplies outside the US before touching our own.

  • Re:"Peak Oil" (Score:2, Interesting)

    by Anonymous Coward on Tuesday November 13, 2012 @09:14AM (#41966311)

    Personally, if the US has these sorts of reserves, we're idiots to tap them today. Use it as leverage to keep the Saudis pumping THEIR oil at moderate prices, and exhaust the supplies outside the US before touching our own.

    Unfortunately that's not how Capitalism works. This would be the definition of collusion or the United States government directing private industry not to make money. We're quite far from China in this respect and that's one area I'd like us to stay away from.

    Did you know we get more crude oil from Canada than Saudi Arabia?

  • by Anonymous Coward on Tuesday November 13, 2012 @09:19AM (#41966341)

    Global Warming is a liberal myth.
    Ok. So stop being a consumer. It's that simple. Sure, it means paying more and putting up with some things that oil consumers don't have to put up with but if you're so concerned than stop buying what they're selling. If enough people do it and if enough money goes into green tech than you'll be able to end the oil industry.
    If you're waiting for the government to hold your hand than you're going to wait a long time before they really abandon the oil culture. By a long time I'm talking generations.
    There's your choices. What's your next move? Grumble and accept your fate at the gas pumps or do you become forward thinking and move on from oil? I can tell you where I'd place my bets.

  • by ByOhTek ( 1181381 ) on Tuesday November 13, 2012 @09:28AM (#41966409) Journal

    I'm a moderate liberal, but I wouldn't say I hate oil. I would rather say that I would prefer an alternative (def. more in the way of nuclear, the waste, while worse, is more easily contained).

    However, I am strongly against drilling for American oil now. I think, when oil starts running really low in other regions, then we should start drilling it. By that point, they'll have exported all their oil at relatively low prices, and we'll be able to export it at much higher prices. It's an investment.

  • by MickyTheIdiot ( 1032226 ) on Tuesday November 13, 2012 @09:33AM (#41966449) Homepage Journal

    What is most sad is because of the captured nature of congress the real discussions (of course happening in the back rooms) is about how this helps or hurts oil companies. Our system has real problems doing stuff for the greater good of all when the internal debate is basically controlled by a group of oil robber barons.

  • Re:"Peak Oil" (Score:5, Interesting)

    by fuzzyfuzzyfungus ( 1223518 ) on Tuesday November 13, 2012 @09:40AM (#41966511) Journal

    Personally, if the US has these sorts of reserves, we're idiots to tap them today. Use it as leverage to keep the Saudis pumping THEIR oil at moderate prices, and exhaust the supplies outside the US before touching our own.

    Unfortunately that's not how Capitalism works. This would be the definition of collusion or the United States government directing private industry not to make money. We're quite far from China in this respect and that's one area I'd like us to stay away from.

    Did you know we get more crude oil from Canada than Saudi Arabia?

    You are missing one important point: not all 'oil reserves' are created equal. Some are nice, clean, sweet, crude conveniently buried in relatively uncomplicated rocks at moderate depth. Others are a zillion feet underwater, badly dispersed through some formation that makes geologists cry, or in the form of dubiously flammable shale or tar sands that can be coaxed into releasing just slightly more energy than required for the coaxing if you are willing to put up with ghastly byproducts.

    The exploitation of different classes of reserves creates externalities of differing severity. Because markets suck at dealing with externalities, we impose some level of regulation designed either to internalize the externalities or to simply forbid activities that cause excessive negative externalities.

    It is entirely possible that, if the US oil reserves are nastier, or if the Saudis need the oil money sufficiently badly to impose the externalities on themselves before we do, we would see a situation where less desirable US reserves remain in reserve until foreign reserves are tapped out.

    This would be a situation created by regulatory pressures(which I would argue is hardly a bad thing, if it keeps us from experiencing the... cost insensitivity... that accompanies oil development in places like the Niger delta...); but it would hardly require the establishment of the First People's Patriotic Petroleum Five Year Glorious Plan.

  • by Joce640k ( 829181 ) on Tuesday November 13, 2012 @09:42AM (#41966537) Homepage

    The problem lies in the fact the issue isn't black and white. Yes fossil fuels cause Global Warming. However we can't get get off the stuff

    Can't? Or don't want to?

    Why can't electricity be produced without fossil fuels? A fraction of the current investment in warmongering could build some of those next-gen nuclear power stations that have been discussed here many times. The ones with almost zero safety/waste issues who's theory has been known for decades but none have been built...what's going on there?

  • by Ambassador Kosh ( 18352 ) on Tuesday November 13, 2012 @09:56AM (#41966707)

    And who is going to pay the costs of not getting off the stuff? All this environmental damage is not free and it has a real cost in terms of our health (and the money it takes to fix it) and also in terms of damage done directly to us in the form of stronger storms.

    Saying that fossil fuels are cheaper is just a way of externalizing the costs. It is letting large businesses make a fortune while our tax dollars go to clean up the damage and the money spent to repair the damage dwarfs the money made from the fuels.

    Also we can eliminate fossil fuels for most uses already right now and we are doing very little of that. About half the energy used in a house is just wasted due to poor insulation. No matter what kind of fuel source you have if you throw away a significant fraction of your power you are going to have problems.

    We have also developed better battery technology, building technology for cars to make them lighter and stronger and companies like BP keep buying up the patents on them like on lithium polymer batteries.

    Sure we can't go 100% off fossil fuels but there is no 100% solution. We can still use a lot more wind, solar, nuclear and combine that with better insulation, EVs for most normal commuter driving and still get at least 80% or more of the way to not using fossil fuels anymore.

    This attitude seems pretty defeatist. Since we can't do 100% we might as well do nothing. The problem is the costs of doing nothing are enormous. Even if all we did was spend the kind of money we do on various wars on insulating houses in America it would still make a huge impact in our emissions and reduce our need for fossil fuels by a lot. That even has a better payback for the society that then wars do.

  • by dbIII ( 701233 ) on Tuesday November 13, 2012 @09:56AM (#41966709)

    the petroleum geologist Colin Campbell estimated that it would happen before 2010

    And he was right, because global oil production peaked in 2008 and we are extracting less now than we did in that year.
    What, you meant something different? OK then, write something different instead of attaching whatever bullshit baggage you have to a technical term.

  • by IceNinjaNine ( 2026774 ) on Tuesday November 13, 2012 @10:15AM (#41966909)

    That's really great rhetoric. Did you know that the United States gets 1/3 of its crude oil imports from Canada?

    Your point? We also get quite a bit from Mexico. I have to ask: are you Canadian? It always seems that the Canucks bring up this factoid to pump their ego. Yes, I already knew that we get a shit ton of oil (and resources) from Canada.

    That's more than it gets from any other nation -- Saudi Arabia included. Are they killing themselves in Canada over petty differences?

    Honest question, do the Canadians give us "special pricing", or do they sell at market rates? A disruption in the Middle East still affects the U.S.

    By the way, could you tell me what's so unstable about Saudi Arabia? George W. Bush seemed to think they were okay.

    Are you serious []?

  • by sumdumass ( 711423 ) on Tuesday November 13, 2012 @10:29AM (#41967013) Journal

    I never did get the wait until everyone else runs out argument.

    Eventually, the costs of alternatives like wind and solar will go down (patents and licensing fees will expire, manufacturing materials and costs will lessen with time and mature processing techniques plus increased efficiencies). There will be other discoveries where we can store energy better or extract it from interesting materials or processes not in use today (I like the idea of making hydrogen peroxide then using it to power low temp steam turbines in much the same way compressed air is being used by the storage need is much lower and not geographically limited). This will lead to less demand on oil thereby making the price remain cheaper. There is a somewhat strong global initiative to replace oil because of climate change fears (whether true or not) and we aren't to far from being able to if we didn't care about other things like growing food.

    It will be like saving that pound of really good meat for a special day and forgetting it can spoil. Or maybe it's more like those guys who built a time capsule out of an old salt mine and placed a car and other items so they would be in mint condition and valuable when they opened it after 50 just to find a water source infiltrated the cavern and they were all rust. []

    I say use it, use it now. Get our energy security within the US, spend money on developing alternatives and we won't have to spend on our military to procure and protect foreign supplies and we won't have to swallow out pride and play nice with brutal dictators trying to ensure that oil flows our direction, Because if we save that botle of milk long enough, it won't be worth drinking.

  • Re:"Peak Oil" (Score:5, Interesting)

    by i kan reed ( 749298 ) on Tuesday November 13, 2012 @10:51AM (#41967265) Homepage Journal

    You know, I held the same opinion until I decided to do some research to back up my position, and found that only the heaviest oils in the refinement process are any good for plastics(at least the consumer/industrial grade plastics we're used to). Those heavy oils are also the worst ones for burning for energy, with the lightest ones being converted to jet fuel and gasoline.

    I'm also pretty impressed with what we're doing with plant-based plastics these days, which are essentially renewable. Not on par with the oil-based plastics, but getting there.

    Suffice it to say, I can't really hold that position anymore.

  • by Psyborgue ( 699890 ) on Tuesday November 13, 2012 @10:55AM (#41967323) Homepage Journal
    They were given that land, legally. The bible has nothing to do with it. Nobody would take the Jewish refugees after WWII and they certainly didn't want to go back to live with people who just months previously were sending them off to the gas actively or passively. They were more than happy to live along side the Palestinians (though they weren't called that back then). It was the Arab Muslims who attacked again and again, and in doing so lost more and more of their land. Do some religious Zionists claim the land to be holy. Sure. There are also lots of secular Zionists such as myself who think Israel is just a good idea.
  • by 140Mandak262Jamuna ( 970587 ) on Tuesday November 13, 2012 @11:08AM (#41967497) Journal
    Did the stone age end because we ran out of stones? Nah, it ended because we found better materials to make the tools, copper and then bronze. Later iron. Then steel.

    The age of petroleum, ushered in by the gusher in Titusville Pennsylvania in 1860s, will end with more than half the oil still left in the ground. Oil prices are very unlikely to top 120$ a barrel for sustained periods of time. It might spike to 150$, but will quickly drop back. Shale oil, tar sands oil, oil from coal, etc are all profitable at prices about 100$ a barrel. Solar and wind beat fossil fuels when oil goes above 100$ a barrel.

    The only huge problem is energy consumed at fixed points (homes, offices, factories) can be switched to alternative energy relatively easy. But the transportation sector (gasoline for cars, diesel for heavy vehicles, kerosene for aviation) is very heavily dependent on oil. They don't switch to alternative energy easily. But new technologies are emerging. But as the oil price goes up, things will start to change. 90% of the cars are driven less than 60 miles a day. Trucks can stretch the diesel by switching to more efficient diesel-electrics, CNG/LPG and other forms of fossil fuels that are not from Arabia. Arab oil is managed by the big oil companies who know all this. They keep the price to maximize profits without giving a toe hold for the alternative technologies. So it is very unlikely they will let the price spike much above 120$ a barrel. But all their manipulation will just delay the inevitable.

    We will leave most of the coal, natural gas and crude oil, in the ground.

Executive ability is deciding quickly and getting somebody else to do the work. -- John G. Pollard