Feb
15
There Is No “Peak Oil” – Contrary To Past Predictions, the World Has Plenty Of Oil, Enough For More Than A Century
By Paolo von Schirach
February 15, 2012
WASHINGTON – Thanks to C-SPAN TV I have watched many times Congressman Roscoe Bartlett of Maryland give several “special orders” speeches, (speeches on whatever topic delivered at the end of the day for a duration of up to 60 minutes), on “peak oil”. Bartlett is a pleasant old gentleman who speaks well. Armed with charts and graphs he made the case that the US and the world had gone past ”peak oil”, that is the time in which extraction had reached its maximum, and that now, because of dwindling resources, supplies will shrink more and more, while prices will go up. And, as the US started sucking all its oil long time ago and used most of it, the Congressman warned that America, as the largest user, is much worse off than other countries.
Peak Oil
As Bartlett put it:
“Oil and natural gas are not forever. They are finite resources. The U.S is relying upon countries that do not like us to sell us their oil. We are competing against other countries to buy oil, such as China, which is now the world’s #2 importer behind the United States. Increasing world demand and global peak oil, or stagnating production, means that oil prices will rise.
The end of cheap oil and natural gas is coming and coming fast. My hope is that more attention is going to be focused not only on the problem of global “Peak Oil”, but possible solutions to meet this challenge with the same drive and ingenuity our leaders and great minds put into getting a man to the moon.
To further this initiative, in 2005, I along with Rep. Tom Udall established the Congressional Peak Oil Caucus. I also introduced a House Resolution that expresses “the sense of the House of Representatives that the United States, in collaboration with other international allies, should establish an energy project with the magnitude, creativity, and sense of urgency that was incorporated in the `Man on the Moon’ project to address the inevitable challenges of `Peak Oil’.”
America relies on imports, but we have more domestic production
Well, Bartlett was right in stating that the US, the world largest consumer along with China, has little oil left and that it has to rely on imports. But he was totally wrong in predicting an oil thirsty world in which the US would have to compete with China, Japan, India and Europe for ever smaller and ever more expensive amounts of oil. The whole peak oil idea is just not true. Plenty of oil world wide.
It is true that America does not have much oil left. Still, we have made progress considered unthinkable by peak oil proponents. Thanks to shale oil extraction, US production has actually increased and it will increase even more in the years ahead. Furthermore, if we combine additional US output and enormous Canadian reserves coming from Alberta’s oil sands, North America will soon be energy self-sufficient. The US will still import oil, but it will be from Canada, not from Nigeria or Saudi Arabia, and this is much better.
More broadly, beyond the vastly improved US outlook, the whole “peak oil” idea awas just wrong. It simply did not factor the abundance of yet undiscovered world wide oil reserves and the technological advances that make it possible to recover shale oil.
Oil for more than a century
Let’s look at the big numbers. In 1980, as Bloomberg Businessweek reports, it was thought that the world had only 1 trillion barrels left. Well, new projections made in 2010 indicate reserves up to 1.5 trillion of “conventional oil”, enough for 38 years. Add to that shale oil and that’s an additional 4.8 trillion. And then throw in oil sand in Canada and elsewhere and you have an additional 6 trillion. That’s oil that will last for well over a century and a half. By that time, I have no doubt that there will be viable alternatives.
There you go. The whole “peak oil” prediction was just flat wrong. There is plenty of oil in the world. And so the dire scenario of an oil dependent America withering away because of lack of access to depleted and super expensive residual world resources is just not going to happen.
Conservation still a good idea, oil is expensive
Look, Bartlett and others are still right when they encourage conservation, smart use of what we have, supplies diversification and what not. While the US has more oil than we thought, it will still be a net importer. And oil is expensive. Certainly the possibility to import all we need from Canada in the years ahead is comforting. Good to have reliable supplies coming from a friendly neighbor. This improves energy security.
But this no justification for complacency, as we do not produce half the oil we need. And this is why we should seriously look at using US plentiful natural gas, another unexpected and cheap additional energy resource, as transportation fuel. That would help America cut down imports and help our balance of payments at the same time.
Still, even with all these caveats in mind, we can breath a bit more easily. The world has plenty of oil and America is an a much better place than what Congressman Bartlett thought. And this is good news.
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