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#1 - Does the U.S. Really Have More Oil than Saudi Arabia?
Posted by Robert Rapier on January 3, 2013 - 11:41am
The Oil Drum staff wishes a Happy New Year to all in our readership community. We are on a brief hiatus during this period, and will be back with our regular publications early in the new year. In the meantime, we present the top ten of best read Oil Drum posts in 2012. The tenth in this series is a post by Robert Rapier discussing the various types of oil, to explain why US unconventional oil is incomparable to Saudi Arabian crude oil resources.
The Difference Between Oil Shale and Oil-Bearing Shale
People are often confused about the overall extent of U.S. oil reserves. Some claim that the U.S. has hundreds of billions or even trillions of barrels of oil waiting to be produced if bureaucrats will simply stop blocking development. In fact, in a recent debate between Republican candidates contending for Gabrielle Giffords' recently vacated House seat, one candidate declared "We have more oil in this country than in Saudi Arabia." So, I thought it might be a good idea to elaborate a bit on U.S. oil resources.
Oil production has been increasing in the U.S. for the past few years, primarily driven by expanding production from the Bakken Shale Formation in North Dakota and the Eagle Ford Shale in Texas. The oil that is being produced from these shale formations is sometimes improperly referred to as shale oil. But when some people speak of hundreds of billions or trillions of barrels of U.S. oil, they are most likely talking about the oil shale in the Green River Formation in Colorado, Utah, and Wyoming. Since the shale in North Dakota and Texas is producing oil, some have assumed that the Green River Formation and its roughly 2 trillion barrels of oil resources will be developed next because they think it is a similar type of resource. But it is not.
Although the oil in the Bakken and Eagle Ford is being extracted from shale formations, the term shale oil has been used for over 100 years to describe a very different resource. This has led some to confusion over the differences between current production in North Dakota and potential production in Colorado. The oil in the Bakken and Eagle Ford formations actually exists as oil, but the shale does not allow the oil to flow very well. This oil is properly called "tight oil", and advances in hydraulic fracturing (fracking) technology have allowed some of this oil to be economically produced. (For more details, I discuss resources, reserves, fracking, shale gas, and oil shale in some detail in my new book Power Plays: Energy Options in the Age of Peak Oil).
The estimated amount of oil in place (the resource) varies widely, with some suggesting that there could be 400 billion barrels of oil in the Bakken. Because of advances in fracking technology, some of the resource has now been classified as reserves (the amount that can be technically and economically produced). However, the reserve is a very low fraction of the resource at 2 to 4 billion barrels (although some industry estimates put the recoverable amount as high as 20 billion barrels or so). For reference, the U.S. consumes a billion barrels of oil in about 52 days, and the world consumes a billion barrels in about 11 days.
Like the Bakken, the Eagle Ford formation in Texas consists of oil (and natural gas) in tight formations that is being accessed via fracking. The amount of technically recoverable oil in the Eagle Ford is estimated by the U.S. Department of Energy to be 3.35 billion barrels of oil.
Without a doubt, these two formations are a major factor in the current resurgence of U.S. oil production. But the Green River formation is the source of talk of those enormous oil resources -- larger than those of Saudi Arabia -- and it is a very different prospect than the tight oil being produced in North Dakota and Texas. The oil shale in the Green River looks like rock. Unlike the hydrocarbons in the tight oil formations, the oil shale (kerogen) consists of very heavy hydrocarbons that are solid. In that way, oil shale more resembles coal than oil. Oil shale is essentially oil that Mother Nature did not finish cooking, and thus to convert it into oil, heat has to be added. The energy requirements -- plus the fact that oil shale production requires a lot of water in a very dry environment -- have kept oil shale commercialization out of reach for over 100 years.
Thus, while the U.S. might indeed have greater oil resources than Saudi Arabia, U.S. oil reserves (per the BP Statistical Review of World Energy) are only about 1/10th those of Saudi Arabia. The distinction is important.
Summarizing the Definitions
To summarize, let's review the definitions for the important terms discussed here:
Oil resource -- the total amount of oil in place, most of which typically can't be recovered
Oil reserve -- the amount of oil that can be recovered economically with existing technology
Oil shale -- sedimentary rock that contains solid hydrocarbons called kerogen (e.g., Green River Formation)
Shale oil -- the oil that can be obtained by cooking kerogen
Tight oil -- liquid hydrocarbons that are obtained by hydraulic fracturing of shale formations (e.g., Bakken Formation and Eagle Ford Formation)
Conclusion: Resources are not Reserves, and Tight Oil isn't Shale Oil
It is pretty clear that at current oil prices, developments in the tight oil formations will continue. It is not at all clear that even at $100 oil the shale in the Green River formation will be commercialized to produce oil, although a number of companies are working on it and will continue to do so. Oil shale is commercially produced in some countries like Estonia, but it is primarily just burned for power.
In order to commercially convert the oil shale into oil, a more energy efficient method of producing it must be found (or, one would have to have extremely cheap energy and abundant water supplies to drive the process). I have heard from multiple industry sources that the energy return for producing oil from oil shale is around 4 to 1 (lower than for oil sands production), and that is before refining the oil to finished products. At this sort of energy return, oil sands will continue to be a more economical heavy oil option.
Thus, my prediction is that despite having an oil shale resource that may indeed be far greater than the oil resources of Saudi Arabia (I don't think I have seen an estimate of Saudi's total oil resources), the reserve will continue to be close to zero for the foreseeable future because there are still many technical hurdles to overcome to realize a scalable, commercially viable process.
Finally, I would say that if a commercially viable process for shale oil production from the Green River formation is developed, the environmental blowback will be enormous. The production of shale oil is more energy intensive (i.e., has higher carbon emissions) than for the oil sands, it has a high water requirement in a dry climate, and it is potentially a huge new source of carbon dioxide emissions. The environmental protests that would arise in response to a growing commercial shale oil operation would make the Keystone XL pipeline protests pale in comparison.
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Thanks for a good comparison Robert.
During the referenced congressional race I wrote to my local paper in reference to Jesse Kelly's comment. I hope it piqued the interest of a few folks and drove them to be a bit more curious about energy, and perhaps the propaganda fest which is fox news.
http://dhymers.wordpress.com/2012/06/01/letter-to-explorer-this-is-just-...
Another thank you to Robert Rapier, and thanks especially for mentioning CO2 and global warming.
I used to be a regular contributor here at TOD, but I've shifted focus as the far more important issue of climate has reared its head.
I highly recommend these podcasts to readers here:
Prof Guy McPherson on possible near-term human extinction due to global warming
The alarming heating in the Arctic, sea ice disappearance, and imminent tipping points
Hello to all my friends here. Keep up the good work!
The Green River Formation has been my home for the past 70 years. I know the country pretty good, and have been over a good bit of it on the back of a horse. I don't think anyone is going to turn it into oil anytime soon, and probably won't ever. I found a vein of Yellow Cake Uranium once upon a time, 10 feet thick, and it ran for 200 yards until it disappeared in the canyon. Problem was, no way on earth to get equipment down there to mine it. The country is just too rough, most of it. So, the Yellow Cake is still there and always will be I guess, just like the Kerogen. There is a proposal for a nuclear power plant at Green River, Utah. That won't happen either because there isn't enough water in the Green River to keep it running. I've seen that river flood and I've seen it at a bare trickle. Reality sucks but it is what it is.
Fremont - here's a picture -
http://en.wikipedia.org/wiki/Carnotite
Yep, that's the stuff,10 foot wide, and 200 yards down the gulch until it disappeared into the bank. I grew up hunting Uranium with my Dad. The days of Charlie Steen, his house on the rock in Moab "Mi Vida", and holding out against the onslaughts of the IRS. I asked about Charlie 10 years ago in Moab, he was still alive, prospecting in Colorado.
Charlie Steen died in 2006. He had been suffering from Alzheimer's disease. See http://en.wikipedia.org/wiki/Charles_Steen
Perhaps they should think about a Molten Salt Reactor. They run at a high enough temperature that Brayton cycles with dry cooling will still produce reasonable efficiencies.
Since the US contains 3,794,101 sq mi, while Saudi Arabia contains only 870,000 sq mi, technically speaking, the US probably really does have "more oil" than Saudi Arabia.
a-c: Some interesting facts that might surprise a few folks.
Cumulative crude oil production - USA: 200 billion bo....KSA: 130 billion bo
As far as the US producing more oil then the KSA in the future that would exactly be unprecidented:
1945 - US: 4.7 million bopd....KSA: ZERO
1970 - US: 9.6 million bopd....KSA: 4.0 million bopd
1980 - US: 8.6 million bopd....KSA: 9.6 million bopd
1985 - US: 9.0 million bopd....KSA: 3.0 million bopd
1990 - US: 7.4 million bopd....KSA: 6.5 million bopd
2000 - US: 5.8 million bopd....KSA: 7.8 million bopd
2010 - US: 5.5 million bopd....KSA: 8.5 million bopd
Why did KSA oil fall to 3.0 in 1985? And then slowly climb back was that a discovery of new fields or new methods of production?
Just a guess, but I think that there were few buyers. There was a flood of oil that hit the market around that time from the Alaskan North slope, the North Sea fields, Cantarell in Mexico, and elsewhere. The oilmen on this board will tell you how they had to drive cabs around those days to make ends meet.
I think that all that cheap oil flooding the market is what really helped the economy (except in Texas) in the mid-80's and thus made Reagan look like an economic genius. But I doubt you'll find many conservatives that will admit that . . . they'll always credit Reagan's tax cuts and his optimistic attitude.
No, that was not it at all. That was the time of the Iran-Iraqi war and the subsequent tanker wars. And it wasn't just Saudi, it was all OPEC, but especially OPEC shipping from the Persian Gulf.
OPEC yearly C+C production in kb/d. The 2012 data is the average through the September only. The data is from the EIA.
Ron P.
It all depends on how you define oil. If you define kerogen as oil, then the US does indeed have more oil than Saudi. But I don't consider kerogen to be oil.
Robert - And one could take it one silly step forward and accept that definition. But how much GR "oil" are we producing...none. How much GR "oil" is currently being developed...none. Sorta like when my wife can't find something she put away in "a safe spot": Not being able to find something is a lot like that something not existing in he first. Having a lot of GR oil that isn't being produced is a lot like having no GR oil at all. Might happen some day just like my wife finding a number of items she stuck away in "a safe place". But I ain't holding my breath on either possibility. LOL.
I always use the analogy of gold in the ocean. Trillions of dollars worth of gold are dissolved in sea water. How much is being commercially produced? Zero, because it would cost more than the gold is worth.
Sudan and Saudi Arabia to mine the Red Sea by 2014
http://www.mining.com/sudan-and-saudi-arabia-to-mine-the-red-sea-for-gol...
I read it on the internet, so it must be true !
I believe Saudi Arabia tried mining the Red Sea another time and eventually abandoned the project.
My favourite analogy is that we are running out of water ... on a planet 2/3 covered in water. There's an ocean of water out there for the taking, but if you're stuck out in a life raft somewhere you can't drink a drop of it. We can turn some of that sea water into usable fresh water, but this requires external energy inputs. In the case of oil shale, if the external energy inputs overwhelm the outputs, then even an infinite oil price will not bring it out of the ground.
Sorry, Null, your statement is incorrect.
It would have been more correct if you said that the extracted oil was going to be used as an energy source. Even in that case, technically, your statement is not correct.
Since you said "even at infinite oil price" you killed your argument. If I was some guy, looking to make a few bucks to buy some food and you said that you would pay me a million dollars to bring you a gallon of oil to be used as a health tonic for rich people. Well, even if it took me a hundred times as much energy to pull that gallon of oil out of the ground, it would still make me a profit so I could buy my lunch.
That is also why even the energy use restriction makes the your statement incorrect. You see, not all energy is the same. Liquid fuels can be far more valuable than hard-to-transport fuels like natural gas, especially for vehicles like tanks.
So, the only way to make your statement correct is to restrict it by saying if it took more oil to produce the oil out of the ground (both oils being chemically the same substance), no matter the price, no oil would be extracted, then yes, you would be correct.
Sorry, feeling retentive this afternoon. ;)
Of course the analogy to desalinating sea water is not exactly equivalent, since one is a source of energy and one isn't, but it's a good way of getting the concept across to non TOD'ers.
But my assertion that even an infinite oil price won't bring oil out of the ground is correct, because in your hypothetical example it required 100 X the energy for you to pull that oil out of the ground. Where did you get that energy?
Muscle power? Putting aside the obvious complication that there's a difference between digging out a gallon of oil shale versus subsequently turning it into usable oil, muscle power is biofuels, and currently we need fossil fuels to produce biofuels. Without those inputs we'd be in a Malthusian Collapse and most of the world's population would die, and they wouldn't even be able to lift a gallon of oil shale, let alone convert it into oil.
Natural gas? In that case the infinite oil price would be justifying GTL plants to pop up everywhere and then the price for natural gas would climb up to infinity minus 1.
Electricity? Where does that come from? Some other fossil fuel? The same argument applies as for natural gas.
Maybe some other TOD member would like to step in and help Null out a bit?
Please do not argue with the word "infinite". First of all it is apart from reality. Second: infinite makes every argument valuable or not, depending on how infinite you imagine your infinite to be. Infinite is a fantastic toy for mathematicians. Leave it to them. To me both reasonings (Null Hypothesis and Tankingthinker) are valuable in there own way, but they do not connect.
OK, I will take another shot at it.
Null is trying to say - If it takes one glass of milk to produce one glass of milk, regardless of how high the price of that glass of milk gets, no will be produced. I think we can all agree with that.
However, the major error that Null makes was to not understand that different forms of energy have different value. It is a common mistake.
For example - people say, "Look! We have the same production of oil today than we did seven years ago. Thus, we are doing just as well!"
What they don't understand is the basic concept of EROEI. They don't understand that if you look at the net energy that is available to do the work, it continues to go down as high ratio EROEI resources are replaced by low ratio EROEI resources.
The next level of complexity is the understand that EROEI is not limited to similar forms of energy. You can use several forms of energy like solar, hydro, NG, coal, etc. to get to your final form of energy. In many cases, that final form of energy can be more valuable, in just terms of the energy content, than the forms of energy that were used in the production.
That is why I used the Tank example. Since black gold is so easy to transport and so energy dense, many people are willing to spend many times more energy, in different forms like NG, coal, etc. just to get that energy in the needed form. You can't run a tank as well on NG because the energy content is just too low and hard to store, compared to the fuels they use now.
We can go a bit further when we talk about oil being used for things outside of energy uses, like cosmetics. Then, you can spend even more amount of different forms of energy to get that beautiful black gold that is needed to produce your cosmetic.
That is why you have to be careful on how you talk about costs, prices and forms of energy. All energy forms are not created equal nor are they valued equally.
Whew, I hope that clears everything up.
I agree with you up to a point but when you say, "different forms of energy have different value", don't forget that if the difference in price reflecting that difference in value (say, between natural gas and oil), becomes extreme enough, then the other forms of energy (natural gas) which are not as valuable as oil will be used to make oil synthetically. That's why I say if oil price goes to $1 million then input natural gas prices will go to $500,000. At that point the differential economics between oil and gas are no different than today, except it's just shifted up a million dollars. It reaches a point where it's still not viable.
True, if we develop alternative energy sources like nuclear, wind and solar to provide enough high EROEI electricity, then that could be used to pull this high value oil shale out of the ground and turn it into cosmetics, or gasoline. But you have to have the minimum EROEI available in some form of energy, or it just won't happen, no matter what the price. You can't violate the laws of physics.
"different forms of energy have different value": I agree. It is a matter of what economics call 'elasticity'. If I have a stove burning coal, wood prices might drop realy far: I will still buy coal. Unless I feel like the wood prices will be significantly lower than the coal prices for an extended period of time, I will not change my stove.
I think we all basically agree on principle, I think the disagreements may come from different assumptions.
My scenario assumes $100 oil and $3 gas. That is not enough of a difference in $/BTU to justify GTL facilities, nor to bring oil shale out of the ground and turn it into real oil. My argument is that if oil goes to $200 and stays there, that would still not cause oil shale to be brought out of the ground and used as a source of energy.
Here is why: if oil went to $200, then I am guessing we would start to see GTL facilities being built to turn that $3 gas into oil, to be used as a source of energy. Assuming the US has only a few decades of gas left, not centuries, then this increased demand from GTL facilities will then cause the gas price to rise to say $10. Therefore the price ratio of oil to gas on a BTU basis remains the same as before, so the input costs to suck that oil shale out rise along with the higher price they get for selling it.
This is what will happen to Canadian oil sand, to a lesser extent. The high oil prices are causing increased production there. But the input energy comes from natural gas which is dirt cheap. Even currently, some companies are having problems however. If oil price goes up further then it won't be long before gas prices follow, then what will happen to profitability of oil sands operations? The EROEI there is still high enough that a portion of the extracted bitumen can be used as the external source of energy to subsidize the rest of the process, so there will be somewhat of a buffer there protecting oil sands operations from high gas prices. But the EROEI of oil shale is to low for this, it can't power itself because there basically is no excess EROEI available to sacrifice.
On the other hand, if cosmetics or any of the other myriad of applications of oil desire the specific chemicals found in natural oil deposits, then providing an external source of high-EROEI energy can be used to extract it, it will be extracted to a certain extent. But not as a source of energy; instead as chemical feedstock.
I am presuming that this external source of high-EROEI energy (nuclear, wind, solar) will NOT be developed on a sufficient scale in North America in time to save us from fossil fuel decline. I could be wrong there, that is just my prediction based on the mentality of this continent. In this case, oil shale won't be pulled out for use as cosmetics because people will have much more pressing concerns to worry themselves about.
***Looks around the room for hidden cameras*** Am I being punk'd? :)
I would suggest that we stick to one topic at a time. Otherwise you get what I like to call Topic Drift. It often happens in debates when one person tries to change the topic instead of facing reality.
Let us get to the brass tacks. Here is the statement in question:
"In the case of oil shale, if the external energy inputs overwhelm the outputs, then even an infinite oil price will not bring it out of the ground."
I have been trying, nicely, to say that this is flat out wrong. Are you trying to say that this is right in any way shape or form? It does not need any assumptions. It is, complete and it is false. End of story. Now, if you would like to start another debate then fine, we can do that.
It is an important point to understand that energy comes in all different forms and has different applications and can be valued in different ways. There are several examples in this thread that show this clearly.
I take it, Null, you are famous, or infamous on this forum? If so, you got me. ;)
"In the case of oil shale, if the external energy inputs overwhelm the outputs, then even an infinite oil price will not bring it out of the ground."
Are you trying to say that this is right in any way shape or form?
Yes, that's EXACTLY what I'm saying (see further clarification 2 paragraphs down). This is basic First Law of Thermodynamics. You may believe that money gets its value from the paper it's printed on, but it actually has value because all money is fundamentally just a claim on energy, when you boil it all down. If there is no more net surplus energy available because EROEI, of the overall energy sector as a whole, has dropped too low, then the concept of money loses all relevance, because there is no more economy, because there is no more society, because half the world is starving to death (this is what will happen if and when we run out of energy). Money only exists because there is net surplus energy available to society, which today seems to be in the order of 10:1 to 20:1 overall I'd guess off the top of my head. When EROEI drops to somewhere around 3:1 overall, it's game over.
Now, as I explained in my last reply, I am presuming that the alternative energy sources (nuclear, wind, solar) will NOT ramp up in time to save us from fossil fuel decline, and therefore we won't be able to maintain a usable net EROEI above 5:1 to 8:1 which is probably about the lower limit necessary to maintain modern human society. I am basing that assumption on the observation that the prevailing attitude in response to "running out" of fossil fuels here in North America is to 1) dig them out of the ground even faster, and 2) export what little oil we do produce (in proportion to consumption) to the Asian markets ASAP where we can fetch an extra $10 a barrel. Of course, I think all of us here can appreciate the folly of that myopic official response to Peak Oil.
If you have a more optimistic future outlook and feel that wind, solar and nuclear will in fact be able to ramp up in time to maintain the positive net surplus energy necessary to maintain society, then I certainly have no problem with that prediction on fundamental grounds. We may have a lot of coal left which could keep us limping along long enough to make the transition, who knows. And in this case, that net surplus energy provided by solar, wind, nuclear (and maybe even coal for a while) could indeed conceivably be used to pull oil shale out of the ground for use as a valuable chemical feedstock. But NOT as a source of energy.
It is an important point to understand that energy comes in all different forms and has different applications and can be valued in different ways.
Yes, and as of today, 97% of world energy supply comes from burning complex carbon molecules (coal, oil, gas, food, biofuels). Each one of those has an EROEI. And each one of those EROEI's is dropping. Oil is hitting rock bottom first.
T - "If it takes one glass of milk to produce one glass of milk, regardless of how high the price of that glass of milk gets, no(ne) will be produced". As odd as it sounds that may not always be completely true. If I had a privately owned dairy the statement would always be true. But what if my dairy were a public company expanding their production base. I'm doing that by pulling in private investors through an IPO as well as borrowing money from my banker based on expanding my heard through breeding my stock as well as buying high quality cows...at an equally high price. And at the end of the day it's costing me about the same price to produce a gallon of milk as I'm selling it for. But every year I'm expanding my production by 20% and projecting expansion for years to come. My reward: my stock that was worth $X/share is now worth $3X/share. But lately milk prices have fallen so I don't even have the operational funds to run my mechanical milking machines. No problem: I've got other assets, like extra grazing land, planting equipment and milk delivery trucks I can sell. I also have a herd of old milk goats that aren't worth much due to a low market value but I sell them below replacement cost. Now I have enough capex to keep expanding my milk production even though it's still costing me about the same as I'm selling my milk for. But that doesn't matter: my stock is now worth $3.5X/share.
Certainly not true for all operators but I know a few pubcos in the Eagle Ford Shale that come pretty close to fitting that model. Consider Chesapeake. I'm not claiming they aren't making some marginal profits but consider that there's no public data that allows one to really estimate their margin. But what is readily available to Wall Street and investors is their proven reserve base which has been expanding. And where has much of that capex come from? In the last few years they've sold over $24 billion including working interest in large portions of their EFS play. This also included some conventional NG fields sold in one of the worse markets for such divestitures in decades. Not only did this give them capex but also reduced how much they had to spend drilling that acreage. Of course that also reduced their revenue from those wells also. Just like bringing a partner in on my dairy farm. Even better: I also charge them a fee for running the farm for them. I also have the partnership pay me rent on my milking machines. And since I sold my milk tankers I have to pay someone to haul my product which the partnership pays their pro rata share but I also charge a management fee for that. Every little bit of cash flow helps. And this is what CHK has done in the EFS: they created a number of oil field service companies that have a monopoly on wells drilled by CHK for which the other partners pay their share as does CHK. But the profit those services companies make goes directly into CHK. At one point about $2 billion per month were being transferred from the oil companies in the EFS to the service companies. Some companies were making a decent ROR on their EFS drilling. But it's been the service companies that having been making the big bucks. Many were charging 2X - 5X what they had been charging before the shale boom began as well as running 2X - 3X as much activity.
And if you hadn't seen my tale before here's an admitted extreme example: I once drilled 4 horizontal NG wells for a small pubco. This increased the company's production from 10 million cfpd to 50 million cfpd. And it increased their stock price from $0.75/share to $5.50/share. And it didn't add $1 of increased reserves: it just accelerated the recovery of the same volume of already proven NG. Of course there is some value doing that from a net present value perspective. But the $18 million it cost to drill those wells greatly exceeded the improved NPV. And no one lied about the process. My annual report showed all the facts exactly as I just described. But the Wall Street brokers didn't care: they had a public company that increased their production 400% and that's what they hyped to the market place. And it wasn't just unsophisticated investors that drank the Kool-Aid: a very savvy Wall Street raider made a successful hostile takeover of the company. And yes: within a few years he lost his *ss when the company went bankrupt and disappeared for ever.
As I said an extreme example but I know of EFS players who haven't been too far from this model. I still contend that the most profitable EFS player has been Petrohawk. And they didn't make the bulk of that profit by drilling but by selling their company and all that undeveloped acreage for $12 billion.
While EROEI is a valid concept it's very difficult to apply mathematically to the process for a variety of reason including the smoke and mirrors situation I just described. Addition no decision to drill any well has ever been made on an EROEI analysis. It's always been $'s in/$'s out. And as I think you mentioned this allows for that varying utility of one energy source vs. another.
Rockman, You had me at investment.
Yes, of course you are right. There are many examples where companies sell at a loss, just to gain marketshare.
I guess the lesson here is to always qualify our statements as strictly as possible and include words of probability like "probably" or "In most cases" or "not likely", etc.
I usually do not step in with most unqualified statements, because it would take forever to have a debate. However, when I see a major violation in energy understanding, like the statement I have been debating in this thread, I feel the urge to step up.
So, let me change my statement to, "If it takes one glass of milk to produce another glass of milk, no matter how high the price of milk goes, most likely no milk would be produced, unless there is some investment idea that would profit or somehow reach an advantage from such action or some other reason I have not thought of that probably could be used to dispute this statement.
How is that? ;)
T - Very good. A short and nasty version may be: there's always a profit to be made if you can seperate a fool from his money. Harsh I know but I've seen it work many times in the oil patch. Particularly in the long vs. short game.
I think you bring up a very good point here. It is one that you often bring up, and it speaks to the crux of humanity's current predicament, the thing that I'm always going on about, that there is currently a complete disconnect between money and the energy that is supposedly providing its value.
Regarding your last paragraph, I fully agree that no financial decision to drill or not to drill, or to do anything else for that matter, is made on an EROEI basis.
The point that I am always trying to make here is that this is a highly abnormal aberration of history, a result of the extreme lengths central banks are currently going to to keep the world's ponzi scheme monetary system propped up. It has built up over the last 40 years since the US dollar became the world's central debt backed fiat currency.
This situation is not at all sustainable, and it will all come crashing down in a catastrophic collapse of the global financial system in the near future. After this, those Wall Street-funded ponzi schemes like in your pubco example will not be able to occur. In this case, the rubber band that has been stretched so far between energy (EROEI) and money (interest rates) will snap back and they will come back into line with each other pretty quickly. Today's current 0% interest rates are an absurdity, and symptomatic of the complete destruction of the dollar's inherent value. The dollar is now worthless on a fundamental basis, and this is the only reason the Wall Street ponzi schemes can fund those pubco shenanigans.
What the current financial ponzi scheme has enabled is that it has extended the consumption mode of society to the breaking point. The world is running out of usable energy but this is not reflected in prices. This will all end in disaster.
"Addition no decision to drill any well has ever been made on an EROEI analysis. It's always been $'s in/$'s out. And as I think you mentioned this allows for that varying utility of one energy source vs. another."
I have been trying to decifer whether EROEI parallels $I$O? All business decisions seem to be driven by the dollar, Stock market and all that. However how well do Dollars track EROEI from and engineering calculation? Diesel in vs ultimately diesel out from the refiner etc?
I think it gets very complicated to calculate because you have not only the EROEI of the inputs vs. outputs, (for example, with oil sands operations, natural gas BTU inputs vs. bitumen BTU outputs flowing down the pipe -- that's easy to calculate), but also all of the other inputs like labour, machinery, pipelines, and other capital etc., all of which ultimately required energy from somewhere. These things come from dispersed places throughout the economy and are harder to quantify.
A refinery does not make a profit on EROEI because it has an EROEI less than 1. It makes diesel and other refined products from crude oil inputs. Doing so "uses up" energy. The energy to run the plant comes from natural gas and electricity, and maybe burning a little bit of the less valuable fractions of crude oil. A refinery makes profit because the diesel it sells is worth more in terms of $ on a BTU basis than the crude oil it buys as input, and this difference more than offsets the cost of the energy losses of the refinery from construction and operation.
Oil and other fossil fuel extraction is fundamentally different than refineries because those activities do liberate net surplus energy, their EROEI is greater than 1. That's the whole purpose of their existence. The overall EROEI of the energy sector as a whole MUST be significantly greater than 1, and it seems that 8:1 is around the minimum. However, it is possible that certain sectors of energy extraction can operate with low EROEI's, conceivably even below 1, in two cases:
1) the $ value of a BTU of the extracted energy is much greater than the $ value of a BTU of input energy. This is the argument being made about oil shale, that if oil price goes high enough then natural gas will be used as the input energy to make the process happen. I am arguing that this won't happen because natural gas won't stay cheap for long once oil price rises significantly.
2) as a result of Wall Street-funded ponzi schemes.
Both of those those two cases require a significantly positive EROEI in the overall energy sector somewhere else to provide the energy to fund them. Therefore, it seems that it cannot be argued that oil shale will ever be available as a source of energy in the "hundreds of billions of barrels" scale that many in the media trumpet, as if it were equivalent to 200 billion barrels of Saudi oil, because the net surplus energy simply isn't available, unless some miraculous breakthrough happens which seems extremely unlikely.
So my answer to your question of whether EROEI parallels $ is that generally it doesn't, but in some sectors it does better than others. This is because of the overly financialized economy we currently live in. This will end at some point and then they will parallel much better, because there will be no more Wall Street to fund the ponzi schemes.
p - Null gives a nice response below. I'll just add that the direct energy inputs to drill and produce a well are very small. In fact a very good well could produce the equivalent energy in just a few weeks...or even days.
The difficult aspect is the embedded energy in the hardware. And when do you stopping counting: at the mill where the steel casing is made or the mine where the iron ore is produced that they use to make the steel blanks?
And $'s vs. EROEI: I've seen the day rate of a Deep Water drill rig swing from $300k/day to $700k/day over the course of a few years. So the difference for an 60 day well is $24 million. Do you think a company will base their decision on that cost or the energy used to build that rig prorated to that one well over the lifetime of the rig? There will always be a relationship between costs and EROEI. But besides being a difficult number to calculate the oil patch wouldn't pay attention to it if you did.
Regarding embedded energy in the hardware: oil isn't a big percentage of manufacturing energy inputs.
Iron ore smelting tends to happen at night, with cheap electricity. It's a nice synergy with both wind and nuclear, which have surplus output at night.
Well I don't live anywhere near where iron is smelted but I used to, and it was smelted around the clock, not just at night. And the main fuel was coal, not electricity. A blast furnace uses coal.
Ron P.
Well, I live about a mile from a steel plant, and it primarily uses electricity at night.
Don't forget, most US steel is recycled, so it doesn't need the same kind of reduction as primary ore (of course, primary smelting can be done without coal, though that's mostly less convenient).
I don't care how close you live to a steel plant, smelting is done with coal. Smelting is not recycling scrap iron, it is removing the iron from the ore. The primary fuel is coal, not electricity and it is done around the clock because of the efficiency. That is, just starting the furnace up from a cold start uses a tremendous amount of fuel. Cutting it off during the daylight hours would cost fuel, not save it.
If you say you know an iron smelting plant, and you did say smelting, that only runs at night you will need a reference because I just flat don't believe it.
You should not make claims that you cannot document.
An electric Bessemer Blast Furnace? You must be joking.
Remember most electricity is generated with coal or gas. You burn something to boil water, push the steam through a turbine and generate electricity. If you used electricity to smelt oar, then that would be a tremendous waste of fuel, coal or gas, because of the losses in the process. It would be many times more efficient to use the coal directly to smelt the iron. That is why they do it that way.
Ron P.
smelting is done with coal.
Sure - strictly speaking, you're right - I was writing briefly, and I used the wrong concept. The steel plant near me runs on scrap - you should see the scrapyard - it would be a great backdrop for a Madmax movie.
OTOH, there isn't much smelting in the US anymore. For instance, 99% of steel in scrapped cars is recycled back into manufacturing. In the long run, the rest of the world will get where the US is - smelting won't be needed much, and recycling will rule the day.
It would be many times more efficient to use the coal directly to smelt the iron.
Well, the coal is both a reducing agent, and a heat source. If we don't care about the various problems with coal (CO2, other pollution, supply limits, etc, etc), then that works fine. OTOH, you can use things besides coal to reduce iron oxide (like direct electrolysis or hydrogen), and renewable electricity will work as a source of heat (though it likely would be a bit more expensive - you'd want to be creative with heat management).
---------------------------------------
The more important point here is that manufacturing doesn't use much oil, so that the embedded liquid fuel in an oil rig is very small. Further, I suspect that a careful analysis would find that the overall embedded energy in an oil rig was small compared to the oil produced.
Actually, I was thinking even in terms of "regular" (thermally mature) oil. With several known and large petroleum systems, coupled with several times the amount of land area the US has in comparison to Saudi Arabia, alone makes it pretty likely we have more oil than them.
AAPG Memoir 74 – ‘Petroleum Provinces of the Twenty First Century’ Chapter 24 –‘ Paleozoic Stratigraphy And Hydrocarbon Habitat of the Arabian Plate’, Konert, etal. Page 502
The earth's crust is not isotropic. There are probably other land areas larger than Saudi Arabia with less oil than Iowa, Wisconsin, Minnesota, Idaho, Oregon, Georgia and Maine combined. I haven't made a calculation, I don't see the point.
Most of the Ocean floor is barren Basalt.
That's why I qualified my statement with:
The petroleum system of the North Slope and neighboring seas alone beats your figures. From pg. 2-112 of this 2009 DOE study:
Notice those oil figures are in trillions of barrels, not billions.
Apples and oranges comparison - generated -vs- expelled.
In the case of the Bakken, oil was generated and not expelled(except to a limited proximate vertical interval). That according to the late Leigh Price of the USGS.
That is what makes the Bakken play unique and the reason oil is produced there today, oil generated within the Bakken Shales did not escape, resulting in the over-pressuring and thus natural fracturing of the Lodgepole/Bakken/Three Forks system.
Whether the conditions that lead to the traping of oil within close vertical proximity to the source rock have been repeated elsewhere is questionable.
Origins and characteristics of the basin-centered continuous-reservoir unconventional oil-resource base of the Bakken Source System, Williston Basin
http://www.undeerc.org/News-Publications/Leigh-Price-Paper/pdf/TableofCo...
Huh? The North Slope source rocks I linked above also listed oil "generated" - same as the Bakken. So in addition to 10-20 trillion barrels of oil in the Alaskan North Slope petroleum system, we have Price's ~400 billion barrels. That's 10.4 - 20.4 trillion barrels, in just 2 petroleum systems in 3 states (Alaska, Montana and North Dakota). Then there's other petroleum systems in Texas, Oklahoma, Kansas, Colorado, Wyoming, California, Louisiana, the Gulf of Mexico and elsewhere. By the time we add all these up, what are we talking about in terms of generated oil? 100 trillion barrels? Then, how much of that has been expelled (to get to your apples-to-apples comparison)? Almost certainly more than the 3.6 trillion barrels in your Arabian Plate petroleum system, I would say. Thus, as as said, by sheer virtue of the US's large amount of geography, coupled with large and known petroleum systems, it's a pretty good bet we've got "more oil than Saudi Arabia."
At least one firm is exploring North Slope source rock. They came on the scene with a roaring sound but are talking a bit quieter now that they have a couple holes in the ground.
"We have drilled through all of our targeted source rock units," Duncan said. "We've proven those (to be) present at the depths predicted and in the state of thermal stress or thermal maturity, certainly within the range of expected outcomes."
is what we heard December 2012 (Ed Duncan is CEO of Great Bear)
MR. DUNCAN stated they are targeting near-term oil production. And rather than leasing and studying like a lot of companies do, they have studied and leased. They want to accelerate their exploitation program with geo-mechanic studies this year and full field development tests next year. At this time next year their plan is to be drilling their first two full production test wells - laterals, fracs and flow-backs. They could be selling oil into TAPS by summer 2012 - although it would be trucked at this time.
is what SENATE RES COMMITTEE DRAFTFebruary 26, 2011 has the CEO saying just under two years ago. [skip down to 10:39:33 AM]
Powerpoint Great Bear presented to the Alaska Senate Resource Committe (4.9MB PDF)
The Universal Apples to Oranges Conversion Algorithm is as illusive as cold fusion.
I was mearly trying to impress on you that territory doesn't translate to 'oil'. That was your original premise, wasn't it ? that the US has more territory than SA and therefore more 'oil'.
a-c: Actually as far as the volume of shale formations which have generated oil I could argue that you’re being pessimistic. The vast majority of rocks on the planet are shales…both carbonate and siliceous. And many have high organic content and have gone through the oil generation window.
But estimating the production capability is tricky. Obviously it doesn’t matter how much oil is locked up in any one shale formation if the geologic history did create production pathways. Consider the heavily played Eagle Ford Shale. There are dozens of other shale formations in the trend that also have huge amounts of oil in them but lack the natural fracture development. And La. shales make the Texas shales look like insignificant. The EFS is a few hundred feet thick. There are areas along the La. coast with many oil bearing shales that are thousands of feet thick. The latest effort was made with the Marine Tuscaloosa Shale…a huge source rock credited with generating beacoup oil/NG in the trend. After some initial positive results by Devon the rumor is that it’s not holding up to acceptable economics.
But you’re correct IMHO: much of the future of the oil patch is tied to the shales. As soon as oil prices got high enough dozens of different shale formations have been tested across the US…formations proven to contain oil decades ago. Some appear to be economic…some not very attractive at least under current conditions. There’s certainly no lack of potential shale production around the globe either. But IMHO it’s rather impossible to estimate the future production capability until thousands of more wells are drilled in those relatively untested sections. Some will work…some won’t.
You are correct in saying that more territory does not necessarily equate to more oil. But once again, that's why I qualified my second statement with, "With several known and large petroleum systems ... the US has in comparison to Saudi Arabia, alone makes it pretty likely we have more oil than them." Perhaps I should have stated that in my first statement, but that's what I did originally mean. Given that qualifier, in the case of the US, a larger territory does equate to more oil than Saudi Arabia. But such a statement might not apply to Brazil or Australia and likely several other nations larger than Saudi Arabia.
Just FYI on that trend, about a year ago I discovered a guy with a blog covering that play. He seems to follow it pretty closely.
Tuscaloosa Trend Blog
That's interesting but misleading.
You need to do a little more studying about petroleum systems. Typically over 99% of the oil generated escapes to the surface and is destroyed by bacterial action.
See http://www.netl.doe.gov/technologies/oil-gas/publications/EPreports/ANSF...
Of the less than 1% that remains as Oil In Place OIP), only a fraction is recoverable as Ultimately Recoverable Reserves (URR).
In Alaska the problem is even worse - the operating costs are so high that it is not economic to develop the smaller oil fields, and the high cost low production developments such as we see in North Dakota and Texas are uneconomic to produce. Only a fraction of the technically recoverable oil is economic to produce at current and foreseeable prices.
One thing I would add is that I recently interviewed former Shell president John Hofmeister, and asked him about commercialization of kerogen. He thinks it can ultimately be done, but feels there are major obstacles regarding the amount of available water and with respect to the politics:
http://www.consumerenergyreport.com/2012/12/10/hofmeister-us-could-tap-i...
But do you think he is right?
Could be. Perhaps in the future when oil prices are much much higher there will be a big arbitrage play using cheap shale gas to extract oil from the oil shale. But as he points out, there is still the water problem.
I don't think there is any gas in the green river shale, just as there is no oil in it either. The gas would have to be piped in from somewhere else, making it not so cheap. And what little water there is in the Green River is already being fought over. The oil companies would not get a drop of it.
Ron P.
The gas would have to be piped in from somewhere else, making it not so cheap.
Hofmeister proposed building nuke plants to provide the energy. So the environmentalists who are adamantly opposed in the first place would go ballistic over that suggestion. But I am skeptical that it can ever be done economically. If you could get a dirt cheap energy input, and oil prices were high, then maybe. But the opposition would be fierce.
And just how much oil could ever be produced with this "underground heater-freeze wall" method anyway? And you have to heat the stuff for three to four years. And nuclear plants still require a lot of condenser cooling water. I think we will see a million barrels per day of oil produced from the Green River Shale about the same time we see pigs fly.
Ron P.
Based on the other resurrected post this week about unrealistically high natural gas supply estimates, it seems that the chances of shale oil actually being produced will only get lower in the future, not higher. Right now the natural gas inputs to the process are practically free and they still can't turn a profit, even with government subsidies. I wonder if GTL is even more profitable. What's going to happen to the economics of oil shale when natural gas prices shoot up?
It's going to take two revolutionary violations of the laws of physics to make this stuff viable: 1) they will have to figure out how to circumvent energy flow to pull it out of something that just doesn't have the exergy available, and 2) do it without the current energy inputs from natural gas. If I may go out on a limb, "It ain't gonna happen".
eroei 4:1? I don't understand why this is too low, is it just the energy consumed by the equipment, not including, capital expenditures, wages, profit, etc.? We know where it is, it's not like it must be found first. Yes it is below 100:1 but when I get .0025% interest on my supposedly safe bank account, I would give anyone $10,000 to get $40,000 back, even if it took 3 years.
This is an apple and oranges argument. First of all, oil is tangible. It has embedded energy that can be used to do useful work. Money is just a claim on future labor. Money can do no useful work unless you can trade if for something that does.
The EROEI ratio tells us what fraction of our economy must be devoted to producing energy versus the fraction that produces everything else. It's the everything else that gives us our standard of living. Imagine a company exerts x amount of whatever it does to get y amount of energy. Now because of depletion this company must switch to a different resource to produce energy. This time it takes 3x amount of whatever it does to get y amount of energy. We either need two more companies or we do without 2/3 of our previous energy supply if the company can only do x amount of whatever it does. To bring the available energy back up to the same level would mean diverting productive effort away from something else to solve the energy shortage problem. If nothing else energy prices must rise due to increased costs or scarcity.
In a global energy market with a high EROEI, i.e. cheap energy, capital can chase after cheap labor markets to transform resources into commodities. Absent cheap wages, profit margins are lower. Prices are higher. Your salary gets you less stuff. The economy grows more slowly. Money to pay on loans is harder to get. Banks have problems with their borrowers. Loans go into default. The paradigm of borrow to grow no longer operates. Tax revenues decline. Governments can no longer kick the can down the road assuming someone in the future will have the money to take care of the problem they put off. Tomorrow arrives. As Richard Heinberg put it, "In this universe nothing moves without energy."
The important distinction is to remember that an economy is not just money. Money is only a claim on labor or commodities. If it's your habit to take money to the grocery store to get food and the store has burned down, claim is worthless. Or if the grocery store is intact and the EROEI for the hydrocarbons that grew the food, processed it, and moved it to the store shelf has diminished, your claim on food diminishes.
DelusionaL, the key issue is what is the minimum energy gain an industrial society needs to continue to function? Ex: 3 units produced for every 1 spent (3:1), 5 units produced for every one spent (5:1), etc. Think of it as the break-even point in a company. How much do they need to make on each dollar spent to for their costs to just equal their profits? For an industrial society, if the aggregate energy gain falls below their breakeven point, then the society eventually fails. A number of researchers have attempted to answer this question. Look up "What is the Minimum EROI that a Sustainable Society Must Have?" by Charles Hall on Google Scholar or find it at http://www.mdpi.com/1996-1073/2/1/25/pdf. The general answer is somewhere around 3:1 to 5:1. This basically puts shale oil (2:1), and tar sands (4:1) at or just below the breakeven point, with corn ethanol (1.7:1 max) well below it. So even though shale oil and tar sands resources are vast, the actual amount of useful energy available using current extraction technology is negative. This does not apply to tight oil, which has a fairly good EROI of I think around 20:1. See the issues of "Sustainability" at http://www.mdpi.com/2071-1050/3/10 and http://www.mdpi.com/2071-1050/3/11 for a review of EROI data and recent research papers.
However, Hall's work does not take onto consideration something I call the "Energy of Sustainability" (S - Imagine a Large Capital "S" with large serifs at its ends). Think of it as the total amount of energy required to transform a highly wasteful industrial society into a lean-green sustainability machine, where the buildings are all Net Energy Zero, transportation energy is at a minimum, and there are no land-fills because all industrial processes are closed loops (industrial ecology), no non-renewable resources are used, no lasting pollution is produced, and everything is recycled (Sewage & waste heat combined to make methane and fertilizer) etc. The energy Breakeven Point is actually a function of time, and depends on the efficiency of the society over time and the transition energy use. We in the U.S. are terrible because of our crumbling infrastructure, vast transportation distances, inefficient cars, poorly laid out urban areas, energy intensive buildings and our once-through economy with little to no recycling.
So I would put the number closer to 7:1 to 10:1 during the transition phase because of the additional energy that will be required. Such a process will also take decades, because of the in-place infrastructure and transportation patterns. We also currently don't have the technology to do this in all areas and segments of an industrial economy. - Pragmatic.
If you run some numbers based on the caloric content of bituminous coal, efficiency of conversion to electricity for heating the oil shale in situ, and the total anticipated reserves, then take the media hype into account, the oil companies are desperate. There probably isn't enough coal in N. America to provide the process heat required to liberate all of it. Do they expect to hold out oil shale as an answer to the liquid fuel problem and then wait until we're desperate enough to sacrifice our water to have it? And what if they have to burn the oil shale itself to provide process heat? It's starting to look like hydrocarbons that aren't fluid don't have sufficient EROEI to make them worthwhile. Tar sands might be just to the positive side of the line assuming consumers can fit them into a business model that accepts $60-$70/bbl. Or they might be telling us, "Please don't dump your stock just yet! There's a big future in oil shale!" Yeah, right.
This discussion is a marvelous example of how much can be said in the absence of actual facts. The water issue Mr. Rapier cites as fatal is much hyped, and even John Hofmeister is out of date. To produce one million barrels per day of oil from oil shale would require less than one percent of Colorado's water use in 2005. The amount to produce one barrel is half that required to produce a two liter bottle of Coke. Companies working now on oil shale development now cite profitable production at oil prices in the range of $40-80/barrel. These are both large and small companies (like Shell and Enefit - the Estonian energy company that just started production at a plant in Estonia that will be cloned in Utah, with a planned startup in 2019).
Red Leaf Resources currently plans production on their land in 2013/2014. Production may well be delayed by environmental activists quietly supported by an administration not enthusiastic about oil shale. It may also be slowed by technical issues, and there are some. But oil shale production is no longer a faint dream. Manned flight took centuries to reach reality, so the lack of production of shale oil in a country blessed by lots of different resources does not really tell you it is destined to fail. By the way, yellow cake is an industrial product not a uranium ore, so the commenter who claimed a ten foot vein does not have a lot of knowledge about geology. Estonia burns much of its oil shale, but is steadily increasing oil production. Brazil does not burn its oil shale, and China does a mix of power generation and oil production. Production is growing worldwide, but it will probably take at least a decade to reach nationally significant levels, even without resistance from the government.
Shell's calculations suggest the gas byproduct will be sufficient to fuel the process, and surface retort builders have shown this to be feasible for surface processing by burning the carbon-rich residue of retorting. The systematic evaluation of the energy balance, carbon emissions, and water use is far less simple than the commenter have presumed, and are an important part of the proprietary information companies have developed but not released.
It is gratifying to have Mr. Rapier acknowledge that the term "shale oil" has applied to the product of oil shale retorting for more than 100 years. Oil shale is not kerogen, but it does contain kerogen, which is solid organic matter not soluble in traditional petroleum solvents. It contains significant amounts of nitrogen, oxygen, and sulfur, so it cannot formally be called hydrocarbon, which must consist only of hydrogen and carbon. Kerogen is the source of all oil, and all source rocks contain residual kerogen, even in the overcooked gas shale formations.
Jeremy Boak, Director
Center for Oil Shale Technology and Research
Colorado School of Mines
Concerning the Green River Shale:
Extraordinary claims require extraordinary evidence. And that is an extraordinary claim if one ever was made.
Ron P.
"To produce one million barrels per day of oil from oil shale would require less than one percent of Colorado's water use in 2005. The amount to produce one barrel is half that required to produce a two liter bottle of Coke."
This math doesn't add up. That claim implies that it requires 1 litre of water to produce a barrel of oil (unless they waste a huge amount of water to make Coke). So that is 1 million litres per day. That is 42 cubic meters per hour. Multiply this by 100 to presumably get Colorado's 2005 water use and you get 4,200 cubic meters per hour. That is NOTHING. That's like a 3 foot diameter pipe, and I have a feeling that the whole of Colorado used more than a single 3 foot diameter pipe in 2005!
Producing one barrel of oil from oil shale requires 1-3 barrels of water. However, the water to grow the sugar crops that go into Coke require 4-8 barrels of water to produce one two-liter bottle of soda. The cola data come from Ercin et al., (2011) Water Resources Management 25:721–741. According to the USGS, total Colorado withdrawals in 2005 were 4,957.1 billion gallons. 1 million barrels per day of shale oil production would require (at 3 barrels water per barrel of oil) 46 billion gallons of water. Your assumptions are wrong.
"Your assumptions are wrong."
Or, you could have been more explicit in defining what "producing one two-liter bottle of soda" actually entailed.
Talk about red herring. We are discussing the water needed in an arid region for production from oil shale and you throw out figures the include sugar crop water included in a two liter bottle of coke. Of course that sugar can be grown in places there is lots of water--the oil shale needs that water right where it is.
You want a good fight, start reallocating water in the west. Not hard to delay anything touching that with a myriad of lawsuits. Just how flexible is water demand as far upstream as oil shale needs it? 'Just the facts maam' is what Sergeant Friday would have said, how 'bout if I change that to 'just the relevant facts please.'
Your end reply to Fremont shows me you may well be a fairly reasonable man, so I'm hoping when talking about Green River region water allocation in the future you don't fish up the US sugar crop red herring again. If you have real relevant facts, and even the total daily Colorado water withdrawal number barely qualifies as such, please let us see them.
I disagree, as corn sugar, a primary source for sweeteners, is grown in areas where irrigation has depleted the Ogallala reservoir by hundreds of feet. In the Toronto area, hardly an arid zone, aquifers had detectable chloride contamination from road salt more than a decade ago, and estimates were that it would take 100 years to clear it. There is no place where there is such an abundance of clean water that thinking about and comparing the water footprint of major industrial processes is not relevant. We consume about a million barrels a day of soft drinks, although numbers are hard to verify, and the proportion of diet drinks is also not clear. It is also true that most biofuel production is greatly more water intensive, so it is unclear whether any crop that is irrigated should be used to make biofuel, if water use is a critical issue. Certainly not in Colorado.
Oil shale development would be a minor part of the water use in the western part of Colorado. It would consume less than 3% of the upper Colorado River allocation, and would add 15% to Colorado's GDP. Agriculture, which uses 90% of Colorado's water produces 1% of its GDP. Snowmaking uses 5% to produce 5%. Perhaps we need a process to decide when water can be reasonably reallocated to newer uses, but the current method involves buying water rights. The major oil companies working in Colorado are confident they have the water rights they need, but will have to assure that they can execute those rights. Much of the opposition comes from Front Range communities that feel they should be allowed to use that water, even though their water rights are junior. They are raising the alarm because companies have senior water rights. If we have a serious water issue on the western slope, it should be addressed by focusing on the dominant users, and making sure they are not wasting water. Perhaps the beverage I should have focused on would be wine, as we make a lot of that on the West Slope, and I am sure it is equally water intensive.
I tried to keep my response brief, but there is so much information that is being misrepresented in these comments that it is hard to pick and choose.
Oil shale development would be a minor part of the water use in the western part of Colorado. It would consume less than 3% of the upper Colorado River allocation, and would add 15% to Colorado's GDP
Obviously you are assuming some maximum development level--if production from oil shale proves to be economic why is that production level the upper limit? Usually economies of scale push those limits higher unless something other demand for the local resources pushes back harder.
All for the national debate, it really needs to center on finding ways to get off of oil--very hard to do considering its portability, energy density and the fact we've a huge infrastructure bias toward using it for transport fuel. If limited oil shale production can fit into the current scheme of things I've no problem with it from this distance, I won't be getting fenced off the strip mines. And like you say reallocating the water could eliminate more wasteful usages. But then I do live in the sub arctic, and I do keep a pretty good eye on the arctic ice ebb and flow--which puts me back to the first sentence in this paragraph.
finding ways to get off of oil though--very hard to do considering its portability, energy density and the fact we've a huge infrastructure bias toward using it for transport fuel.
Technically, it's really very easy. Hybrids, plug-ins, and EREVs all work very well - affordable, convenient, etc, etc.
The real problem - pushback from FF industries, especially the Koch brothers.
Apparently not affordable or convenient enough if market share is an indication. Why push for more water to produce tight oil and oil shale if the imminent change over to hydrids, plug-ins and EREVS will easily make that oil production unnecessary? 'Easily' is a term you are awful loose with. The more non conventional oil we get to the market at once the cheaper is stays, the more of it we use quicker and the less we will transition away from it. Right? Sounds like the Koch bros strategy to me.
Apparently not affordable or convenient enough if market share is an indication.
1st, most new car buyers pay more attention to the purchase cost than operating costs, so saving money on fuel is a hard sell, even if it's real.
2nd, new things can't just be as good as the old thing, they have to be 2x better, or why should anyone take the effort to try something new??
3rd, fuel is badly underpriced in the US.
We all agree that pollution (including CO2) and security of supply are very real costs, right? Climate Change, and ME military costs and domestic security costs (probably $500B per year) are very expensive.
So, these costs should be priced into fuel, right? Fuel should probably be priced in the US at least where it is in Europe.
Right now partial electrics (hybrids) are the optimal point for cost savings, but if fuel was priced at $7-$8/gallon, we'd see much, much faster movement towards hybrids, PHEVS, EREVs, and EVs, right??
4th,
Why push for more water to produce tight oil and oil shale
I'm not pushing for more water. I'm just on the side of realistic analysis, whether it's about oil or alternatives. I see no point in unrealistic analysis, even if the results don't happen to fit perfectly into what I think should be our overall goals.
I'm just on the side of realistic analysis
I'm sorry realistic analysis will have to include just how we get Americans to raise the price of fuel to where you say it should be and has to be to make the Technically...really very easy vehicle fleet transition happen. Other wise its just piecemeal analysis. Laying it on Koch, and old ways won't do it. The $$$$ have to work for Joe and Jill now.
(hint: find some other example to hold up to joe and jill sixpack than Europe. I know they really likely don't even known where the place is but they do have a foggy idea that its economy is making ours look good--not the model they will be looking for).
I was replying to Mr. Boak who was being very inclusive when talking about water, my statement, all for the national debate, it really needs to center on finding ways to get off of oil--very hard to do considering its portability, energy density and the fact we've a huge infrastructure bias toward using it for transport fuel was meant to be taken in its most inclusive form. Huge infrastructure bias=world economy built around oil transport. We have done that by not paying near what oil was worth...so very hard to do is well supported by the rest of the sentence.
For you realistic analysis does seem tend toward a Richard Nixon GDP per square foot thing so I won't get into water use shaping land use issues (has a lot to do with systems approach). Since keeping heavy industry out of a non industrial area is generally the goal of using water issues in the manner I have been mentioning, all those strategies would be very selfish. Good thing those Appalachians weren't that selfish about their mountain tops being removed, it seems to working out real well for the watersheds affected. Wonder if anyone feels those water issues should have got a tad more attention earlier on. Naahhh, that would have been selfish hoarding that coal just to save the streambed habitat.
Luke,
Sarcasm just annoys your audience off and suggests to them that you don't have real, substantive arguments - it doesn't convince anyone of anything.
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realistic analysis will have to include just how we get Americans to raise the price of fuel
That would be nice, but we can't tackle everything all the time. It's helpful to know what the problems are, and what they aren't - and they aren't the basic technology of renewables and electrific transportation/HVAC.
Laying it on Koch, and old ways won't do it.
If that's the reality, that's the reality.
The $$$$ have to work for Joe and Jill now.
They do - they're just not overwhelming. A Prius C, for instance, costs 40% less than the average new vehicle, and uses 60% less fuel than the average vehicle in the fleet. It's lifecycle costs are substantially lower than it's competitors, such as the Yaris.
If we step up to larger vehicles, we see the same thing: a standard Prius is cheaper than the average new vehicle, uses 60% less fuel than the average vehicle in the fleet, and has lower lifecycle costs than a comparable ICE. A plug-in Prius is about the price of the average new vehicle, and uses 75% less fuel than the average vehicle in the fleet.
find some other example to hold up to joe and jill sixpack than Europe.
I'm not talking to them, I'm talking to you and other more informed people on TOD.
Richard Nixon GDP
??????
Analysis requires talking things one step at a time. You can't understand a system without understanding the components.
Oddly, you seem to be objecting to the realism of including external costs in our analysis, which seems contradictory. External costs are real, right? We should include them in our overall analysis of costs, right?
keeping heavy industry out of a non industrial area is generally the goal of using water issues in the manner I have been mentioning
Well, that's a new topic. So far, you've only mentioned water limitations and political objections from current water users, most of which (if you count by volume of consumption, instead of the number of farms) are very, very large industrial farms. I mean, seriously - big agriculture (e.g., CAFOs, etc) is the environmental "good" that you want to protect?
Nick,
Glad I annoyed you with the sarcasm, that was the intent. Your piecemeal, disjointed response style is extremely annoying to me. I have often wondered if Nick replies were coming from a committee that only chimes in after the 'key word activated automated response cut and paste' program either gets into too deep a water for its design or is down for a while. I've read more Nick than most here and in several years all I can remember that indicated that a portion of Nick might be human was a story about flying over bicycle handlebars on a Colorado downhill, revelations about buying meds on the cheap while travelling in Europe (indicated long term prescription med use which immediately raised a half dozen or dozen possible scenarios to my mind's eye) and about living in some sort of upscale (possibly gated) condo complex (my memory is foggy on that one). Oh and one more thing, Nick recently went ballistic when cattle water use entered the discussion--that indicated that some segment of Nick might be religiously vegetarian. Why would who Nick is matter you say?--sounds like the machine is back on line if you have to ask that question.
I eat the food so I put up with the factory farms. I'm all for using resources in that industry more wisely but we are not going to feed the population we have without factory farms. I'm going to continue to eat meat, and I am not going to drive 600 miles round trip to bring 60-80 pounds of caribou home. A spike fork moose walks through my yard during bow season and our beef/pork consumption falls off the chart for many months. I will still drive 800-1000 miles round trip to dipnet 20-50 red salmon whenever it works into our schedule--at least I will do that at current fuel prices. It is a lovely trip, one that takes a fair chunk of change for a tourist to complete.
Of course there is pressure to strip mine coal directly across the inlet from where we fish. The GDP/sq. foot metric would certainly make coal mining win out for land use in that area, though if the streams it disrupts did not return to previous wild productivity for a long enough time that will not be the case--but then the coal mine would front load returns and that future discounting thing sticks its head up again.
The neighborhoods I'm familiar with in the Bakken region of Montana are not factory farmed. Likely all the oil that can be economically drained from those formations will be--whether ND and Montana are up to the task of properly monitoring and regulating the water and air issues there is another story. No doubt roading up and piping up the entire Bakken, burning all the diesel that will be burned to drill and haul everything around it, spilling what will be spilled on it, flaring beau coup gas over it and on and on will not be an upgrade to the environment in the region. It will recover eventually.
But this set of threads has been about Green River shale. And your arguments indicate you believe our oil needs will be met without development of that resource. Guess what I think you are right there. So why develop it. We have plenty of other resources we will need that will require industrializing rural and even wilderness areas. If water use permitting can be used to keep unnecessary development away from a region it should be done. The Green River country does not need to be industrialized unless you take the viewpoint that the USA's goal should be to maximize GDP/square foot--an undercurrent in more than one of Nixon's speeches. Taking water from west slope wine production and putting it into oil shale production (Boak's solution) is all about GDP/foot if we do not need the oil that will be produced with that water.
Your saying Well, that's a new topic. means you really aren't very good at reading between the lines. Of course I wouldn't expect an automated response system to be able to do that--machines are not much at nuace. It is never an advantage to spell out the water use position I was taking in any more detail than I did. Front loading of returns thing again--money now trumps so you have to muddy the view of the money now, essentially by using the Koch type information dissemination to the masses you find so troublingly effective.
As you said it is a piece at a time thing, and limiting access to acreage that does not need to be torn up will slowly force up the price of oil, which is what needs to be done to move jill and joe away from the SUV they really could do well without. Of course if joe and jill have paid for ICE rigs and they limit their driving radically it is very likely they will be doing more good CO2 wise than if they run out and swap one out for a new Prius so they can tool around the countryside like it was the 60s again. There aren't near enough used Prius to let every joe and jill run out and grab one of them and to expect used prices to remain where they are. The front loading of costs is the big disadvantage the hybrids, EREVs and EVs will be fighting to overcome for some time to come. Future discounting is a huge part of our decision process and that is not going to change. Higher fuel costs now do reduce the front loading.
Anecdotally I was talking to my insurance agent the other day and she had purchased a hybrid in Germany, which the military shipped home for her (we will not go into the CO2 issues resulting from that practice). Then she ended up in the northeast for a while--according to her the winter mileage the hybrid attained was was not noticeably better than that of a comparable ICE rig on her standard cold weather commute. She only saw the advantage on longer trips especially to warmer climes. Very few long studies out there address this issue. Good reason as for most Americans winter is not that long or deep, but to me cold weather performance is very important. The vehicles do have to be better to replace tried and true, that is how it is. Horses and mules held there own till Ford got prices down and quality up enough to make a run at their dominance.
Glad I annoyed you with the sarcasm, that was the intent.
That's too bad. Maybe you should take a break, and rest a bit. Destress some.
Your piecemeal, disjointed response style is extremely annoying to me.
hhmm. I'm not sure what you would suggest - I don't have the time to write a treatise for every comment. OTOH, do you want answers to your individual questions, or not?
Heck, if you want to have a simple conversation, dealing with just one point, then write a short comment, with just one point. We can have a snappy, clear conversation about that.
I have often wondered if Nick replies were coming from a committee
You flatter me. I'm just one person. OTOH, I think you're using your imagination way too much, and thinking about me the messenger when you should be thinking about the ideas, instead.
all I can remember that indicated that a portion of Nick might be human
I like to stick to technical details. OTOH, what do we know about anyone here? Sheesh!
revelations about buying meds on the cheap while travelling in Europe
That was someone else.
Nick recently went ballistic when cattle water use entered the discussion
Well, water use is generally remarkably irrational, and livestock water use is especially dramatic.
Really - people are worrying about having enough diesel for farming, right? Well, when we only need about 2/3 ounce of diesel per pound of grain, and we need 168 gallons per pound of grain, does it make sense to worry about trading 2 gallons of water for a gallon of diesel??
I eat the food so I put up with the factory farms.
Sure, but they're still "industrial". No less so than oil production.
The GDP/sq. foot metric
You've made up a whole paradigm for my analysis that's incorrect. I think "external" costs like disruption of natural ecosystems is very important. As you note, I suspect shale oil isn't a great idea.
OTOH, it's possible to have several mildly contradictory ideas in one's head at one time, like: 1) water won't stop shale oil, but 2) it's still not a good idea for other reasons, and 3) it may happen anyway, if there's demand for the oil.
If water use permitting can be used to keep unnecessary development away from a region it should be done.
I see where you're going. Well, you're probably right. Still, I'm not sure that's getting priorities right. If shale oil is immensely dirty, as I suspect retorting would be, we shouldn't do it. OTOH, the Shell process might be pretty clean, relative to a lot of other things.
Heck, if we really want to focus on appropriate development, we should probably take away most of the agricultural water rights in the region, and stop farming the desert.
It is never an advantage to spell out the water use position
Now you've really lost me. You're concerned about clearly spelling out your position that shale oil is too dirty and disruptive? That doesn't seem like a risky thing to do. Now that you've done so, maybe we can have a more productive conversation!
--money now trumps so you have to muddy the view of the money now
I'm baffled. I often say that big money is the problem here - if you agree, then we should both say it more often. If you don't agree, then I'm really baffled.
limiting access to acreage that does not need to be torn up will slowly force up the price of oil
If we have the political clout to do that, why not just raise gas taxes? If not at the federal level, then the state level? Or county level? Why force up the price we pay to Saudi Arabia? Are any of the people in Colorado who are concerned about oil shale really following this line of thought of raising oil and gasoline prices? They'd vote for higher gas taxes??
I do kind've think it would be not a bad idea for the US to maintain it's level of oil production, and maybe scootch it a bit higher. Of course, I think we should put 100x as much emphasis on reducing consumption - the US (and the world) would be far, far better off if it reduced oil consumption (and other FFs) dramatically and quickly.
Future discounting is a huge part of our decision process and that is not going to change.
That does make things harder. That's why CAFE regs make so much sense - it bypasses that faulty consumer decision making process.
The vehicles do have to be better to replace tried and true, that is how it is.
Sure. OTOH, here at least let's acknowledge that the hybrids, plug-ins and EREVs are just as good. And, again, those external costs are real - we know that, right? So, in reality, electrics (and partial electrics) are much cheaper, even if consumers don't see it on the price tag. Right?
I believe Spain or France was the country in Europe where buying cheap scrips was mentioned. The conversation was at least a couple years ago and though I can't remember the season it seems it was green here which limits time of year quite a bit. It seems the discussions were hitting on air travel quite regularly around then, but all kinds of topics regularly entered ever so many threads--can't quite recall how meds worked their way in, possibly when comparing health care systems. And it seems 'Bicyle Dave' was commenting pretty regulary around then too but he wasn't in that conversation (I wasn't either). I could be mistaken but it appears I remembered the other Nick details accurately. Maybe someone else uses your login when you aren't looking?-).
To the rest of the comment.
As ususal your reply looks like you never read the entire comment once through first but started right in on replying to it one sentence, phrase or even word at a time. I generally write my sentences to flow together and often edit them down to almost too dense a form (not today though). Sometimes I very intentionally skip an transition sentence, the writer follows or doesn't. So be it. Either I felt the reader needed to make the extra effort to connect the statements to get the most out of them or I just wasn't going to say anything more specific because I felt it unwise to do so. Of course sometimes I am just sloppy. When reading any blog comment that is how it can go.
Mr. Boak began the obfuscation on this topic by setting up the maximum water oil shale development would need from the system to show how insignificant that would be (actually first he went after the water in a liter of Coke and since has moved that argument to include the assumption all sugar used/grown in the US using Ogallala aquifer water--I just left that alone).
He set up the maximum water usuage-
-Without referring to the total size of the oil shale resource--which is huge
-Without mapping the most likely areas to be developed first
-Without showing how many areas could be simultaneously deveoped on the watershed in question
-Without showing how there would be an upper limit to the economies of scale for producing areas individually or the entire region as a whole
-Without showing that these economies of scale would diminish if production in the area/s/region increased past a certain scale
-and never included price-point/scale-of-development in any fashion whatsoever
In other words he never shows why oil shale development will only use so much water
He merely states, and you don't call him to task for it by the way,
Oil shale development would be a minor part of the water use in the western part of Colorado. It would consume less than 3%
A simple statement of fact, one which is absolutely meaningless as there in NO proper frame of reference. So much more is unsaid than said in Mr. Boak's 'statement of fact.'
Water use in the west is often hotly contested. In the past water use discussion often came to include metals, one metal in particular. If you guessed Au you are at a bit less twice the specific gravity of the metal I'm thinking of.
Water use is a starting point, and it can rally the diverse interests of small, vocal and influential groups around a central issue while at the same time affecting large swaths of land. That can bring attention to the bigger problems that are driving water use in the first place. We need to start somewhere.
Higher oil taxes are currently a non starter in any US conversation. Hybrids, EVs and EREVs are going to have to capture a bigger share of the market without those taxes. That will require their having a higher perceived present value than they do now. Get enough of them on the road that perception will change--if they perform well enough and enter the used car market with enough life for the price left in them.
I believe Spain or France was the country in Europe where buying cheap scrips was mentioned... it appears I remembered the other Nick details accurately.
No, not really.
Why do I like to be anonymous? It all started decades ago - picture it: me and a beautiful woman amidst a guerrilla war in a small middle eastern country.....
:)
No, seriously, why the anger and the ad hominem argument? The odd thing is that we actually seem to have agreed on most things here.
So, let me ask a big picture question, if that's where you'd like to go.
As I said, before, I do kind've think it would be not a bad idea for the US to maintain it's level of oil production, and maybe scootch it a bit higher. Of course, I think we should put 100x as much emphasis on reducing consumption - the US (and the world) would be far, far better off if it reduced oil consumption (and other FFs) dramatically and quickly.
Is that how you would see things?
me and a beautiful woman amidst a guerrilla war in a small middle eastern country.....
hope you girls are having a good time...because of the range in tone and construction of your replies at any given moment it can be easy to picture you as box on Hawking's type chair or an adolescent idealist subject to sudden letdowns but forever resilient. Both of the preceding might be part of a class of students where the teacher occasionally finds it necessary to take the helm, or of a tech savvy family where replies work there way from the youngest to the oldest depending on how involved the discussions become. Of course a middle aged man or woman with Prozac nearby would come across similarly?-)
Most other posters here find it desirable to leave a slightly more discernible print ?-)
As I said, before, I do kind've think it would be not a bad idea for the US to maintain it's level of oil production
For how long? That is the big question. Go after oil shale in a big way (assuming the $$$ pan and the water is made available) hard to say how long production stays ~level. Westexas believes Bakken wells will get P&A within ten years of the when they start producing. I've yet to see anything definitive on that. Tens of thousands of wells producing ten barrels a day is a steady trickle, higher prices will keep them drilling weaker paying Bakken prospects steadily for maybe fifty years. There is pressure to put more in the pipe up here as well. How much is available depends on the price of course. Lots of heavy stuff on the slope but it is spendy stuff to move.
Sadly the only thing that will speed the world's move off fossil fuels will be price. There has been precious little movement to pull externalized cost into the present cost and as tighter oil supplies do appear to be putting a drag on the economy I don't expect the FF price to start reflecting true cost anytime soon. So again how long do you think we should hold production in the US to current levels?
The US has plenty of oil resource if the price goes high enough. Probably enough to out produce Canada's tar sands (at current development projections) for many decades without going after oil shale. A world that has moved significantly away from oil as transport fuel should only need 20-30mbd right? That should easily handle long haul shipping, remote power needs, heavy construction and air travel where oil is kept on because those uses can readily sustain prices of twice today's in today's dollars.
So again how long to we try to keep production where it is? The sooner we move the bulk of the transport fleet off oil of it the sooner the rest of the world can follow. Sadly only higher oil prices will force that move in the US and even sadder the US will only allow higher prices that come with tighter supply. That policy could change but I see no indication that it will as long as world supplies bump along at current levels.
the US will only allow higher prices that come with tighter supply.
I kind've think oil prices will stay in a relatively narrow band for a while: rises will cause reduced demand, declines will cause reduced production by KSA.
I'd like to see much faster change, but I think oil demand will also bump along pretty close to where it is now for quite a while - increased efficiency in the OECD will be balanced by increased demand in developing countries.
Everyone just bumps along, held hostage by the oil, gas and coal industries...
The latest really interesting alt-energy development seems to be in PV - a lot of places are at grid-parity, and it kind've looks like it's set to really take off. That's going to be fascinating to watch.
It's a decentralized thing, and utilities will have a pretty hard time stopping people from saving money. Utilities are a bit freaked, especially in places like Hawaii, where the economics of PV are overwhelming (oil generation, and lots of sunshine)...
Producing one barrel of oil from oil shale requires 1-3 barrels of water. However, the water to grow the sugar crops that go into Coke require 4-8 barrels of water to produce one two-liter bottle of soda. The cola data come from Ercin et al., (2011) Water Resources Management 25:721–741. According to the USGS, total Colorado withdrawals in 2005 were 4,957.1 billion gallons. 1 million barrels per day of shale oil production would require (at 3 barrels water per barrel of oil) 46 billion gallons of water. Your assumptions are wrong.
I read somewhere, maybe Cadillac Desert, that the Colorado River water resource is already over allocated. Perhaps as much as 15% over allocated. There is some disagreement on the amount of overallocation however. The point is, the water resource of the Colorado Plateau is minimal and what there is is essential to the survival of the economies of Las Vegas, Denver, Los Angeles, Salt Lake City, St. George, and Phoenix, not to mention California's Central Valley where a lot of the nation's food comes from. John Wesley Powell noted in his journals that this region was unsuitable for large habitations, and he was right. We haven't experienced a 100 year drought since us white folk have been here, but one will surely come. Who knows when, but some think, according to tree ring records and records left by the sediment in the bottom of some High Sierra lakes that it won't be long. Of course, that may be 100 years, or 200 years from now, or maybe this year. No one knows. And then there is the issue of global climate change and the prognostications that the southwest, including the Colorado Plateau will become warmer and drier. We shall see, but I will always maintain that shale for oil is a looser's bet, and I have no pig in this game.
the water resource of the Colorado Plateau is minimal and what there is is essential to the survival of the economies of Las Vegas, Denver, Los Angeles, Salt Lake City, St. George, and Phoenix, not to mention California's Central Valley where a lot of the nation's food comes from.
Again, I have to ask - which makes more sense, using 168 gallons of water to produce a pound of corn worth about 15 cents, or 2 barrels of oil worth about $200?
Some people are worried about adequate supplies of diesel for farmers: wouldn't it make sense to use .1% of the water currently used for agriculture to produce enough diesel to power the entire ag community?
Not that I think shale oil makes much sense, or that it will ever be big in the US - I just can't make any sense of the argument that water is a significant problem for shale oil production.
Do you have any links to official sites showing oil shale production volumes up to today?
Thats not to difficult to find: Just type "Enefit" into your search machine. Production in 2011 was 240.000 tons of liquids, or about 1,2 mio barrels.
Petrobras has produced about 3400 barrels per day since the 1990s. China's production has grown to from about 10,000-14,000 barrels per day over the past three to four years. Estonia has been increasing production from 8,000-13,000 barrels per day, with another new system just put on line that will add 5,000 BOPD to that amount, and other plans for perhaps another 10,000 over the next three to five years. Modest production with modest growth. It will be some time in the next decade before it reaches really significant production.
These guys know from barrels of shale oil:
http://www.scottishshale.co.uk/HistoryPages/Technology/ObtainingOilfromS...
That was in Scotland the early 1900s. The oil vapour was further refined, and the ammonia was used to make explosives.
I'm not sure how similar it was to Green River shales.
http://www.scottishshale.co.uk/HistoryPages/Geology/GeologyIntro.html
Mr. Boak, Director,
We called it Yellow Cake, and what I found was what we called Yellow Cake, lots of small pieces of petrified wood mixed in with a lot of yellowish crumbly sandstone rock. Yellow Cake, aka, high grade uranium ore, and it was in a 10 foot high vein that ran for 200 yards and then disappeared into the rock in a deep canyon. And, by the way, I've seen a hell of a lot of rocks and so I do know something about Geology.
I have to apologize to Fremont. I took a cheap shot, and there was no call to do so.
His geologic observation was really exciting, and I was either just too revved up or generally in a bad mood. Doesn't excuse it, but hopefully I will learn a lesson. A number of uranium minerals are bright yellow, and the association with petrified wood is common in the Southwest. But it is a novel geologic association for the Green RIver Formation, so it would be interesting to see!
Sorry about the cheap shot. I hope this apology is acceptable, and that, if it isn't, you will follow up and say what else is needed.
According to Enefit it takes 1,06 barrels of water for one barrel of oil https://www.enefit.com/en/enefit140-oil-plant
"The water issue Mr. Rapier cites as fatal is much hyped..."
Could you point out where I cited this?
He's probably thinking of this, in the 7th paragraph:
" The energy requirements -- plus the fact that oil shale production requires a lot of water in a very dry environment -- have kept oil shale commercialization out of reach for over 100 years."
The description of water requirements seems unrealistic: 2 gallons of water input per gallon of oil output doesn't seem like "a lot of water". There is fairly extensive irrigated farming and cattle production in the semi-desert high plateau of Colorado, which require far more water relative to their value.
Which makes more sense: using 2,500 gallons of water to produce one pound of $6 beef, or using it to produce 1,250 gallons of $3 fuel?
If shale oil were to be produced, one imagines that a sensible company would just buy water rights from nearby farmers, at a relatively very low cost.
----------------------------------------
I don't expect much oil production from Green River shale anytime soon - GTL and CTL would be easier. Heck, hybrids, PHEVs, EREVs and EVs make far more sense.
Retort production would be pretty dirty, in many ways. OTOH, there's going to be a fairly large supply of surplus, cheap night time wind energy in the area at some point. There's a possibility there for the Shell process.
Most of the cattle production from the Colorado Plateau is from "Open Range" operations. That means, the cattle graze year round on government land (Bureau of Land Management, Forest Service, or National Parks). Alfalfa is grown for temporary feed during the early spring after roundup from winter range, when cows are worked (vaccinated, bull calves castrated, marked by branding, notching ears, tagging, and or waddling). They're again fed a bit of hay in the fall after roundup from summer range before turnout to winter range. Winter Range is the desert country, summer range is the mountain country. Young Heifers are kept in pasture in case there is a problem with their first delivery of a calf by some Ranchers, others make it or they don't on the desert. Water is used for irrigation of Alfalfa. Water for cattle comes from water holes, small streams and rivers, and springs and seeps. Some years water is abundant, some not. On my place, most of the water I use for irrigation of Alfalfa (Hay) winds up in the ground and back into the Colorado River via the Fremont, Muddy, and Dirty Devil Rivers. My water right dates to 1886 and, in Utah, enjoys the same due process protections given to Utah Citizens. So, first, growing cows on open range makes little difference to to the quantity of the available water resource and second, those who live on the Colorado Plateau, are absolutely dependent upon what water there is. Common wisdom is....."Whiskey's for drinking, Water's for fighting".
Hmmm. Well, does "Open Range" cattle production typically use grain finishing?
It's quite striking to look at aerial photographs of arid parts of Colorado, and see the quarter-section irrigation circles for grain production. According to Pimental, corn takes 168 gallons per pound, and soybeans require 240 gallons per pound.
Heck, corn sells for about $.15 per pound. Which makes more sense: using 168 gallons of water to produce $.15 of corn, or $200 of oil??
My water right dates to 1886 and, in Utah, enjoys the same due process protections given to Utah Citizens.
But, you can sell either the water, or the rights, correct? You may choose not to, but how much land near you is owned by people who don't live in Utah, and who don't care so much? Or, by people whose kids have moved away, and have no one to work the land after they die?
In the fall Steers are sold and many do go to feed lots where they typically are fed a high protein diet for weight gain and marbling. But, the big feed lots are for the most part located in the prairie states where corn and grains are grown, Nebraska, Eastern Colorado, Eastern Wyoming, Kansas, South Dakota. Very little corn or grain is produced from the Colorado Plateau. Most of that country is too high in elevation, too cold, and too dry. The Midwest has the Ogalala (sp) aquifer for corn and wheat crops. As for selling my water, I can sell my right, but typically, the ground has to be sold with it. Most Water Companies, the typical organization of agricultural users on the Colorado Plateau, do not allow sale of individual water shares to outside interests without the ground going with the right. A user never owns the water, just the right of use. A water right in this part of the country is very valuable, because, without water for irrigation, the ground is pretty much worthless. You can't grow anything, you can't raise anything. I owned water in Northern Utah, each share certificate had $10.00 printed in the corner. When I sold the place, my water was valued at $8000.00 per share, considerably more than I paid for the ground in the first place. The Agriculture Culture on the Colorado Plateau is a water culture and I think no one who has land and agriculture interests will sell out for oil production. Most of the water In the Colorado River is spoken for by the large metro areas in the Southwest, Phoenix, Las Vegas, Los Angeles, etc., the water that remains in the feeder creeks and streams, is owned for the most part by small agricultural operations. For them, water is what gives life to the land they have lived on and worked for in many cases five generations. They're not going to give it up. Money doesn't mean much to us. Our way or life does. Without water we have no way of life. As for folks who have land here, but don't live here, or have summer places, they own no water, other than a right to drill a well for household water only. They don't own water because we won't sell them water because they don't really live here and they're not part of our culture. You kind of have to live here to understand. And, there is always someone to work the land after a land owner dies, a son, a grandson, a cousin, someone always steps in. Now and then a place sells to an outsider, but, not often. When they do, more often than not, they're stripped first of their water rights (sold to members of the same water company) and the place is sold as a trophy place with "scenic value". Which means, it's damn pretty, and you can keep a pet horse or two, but not much else because there isn't enough water for much else.
Freemont,
It is always good to here you chime in when Green River shale issues comes up.
One point you didn't address was water rights connected with Utah BLM grazing land. Seems water rights for that 22 million acres would be substantial--that was the unstated core of my question to you. I doubt Utah ranchers are great fans of the fed but they certainly have a vested interest in how its land the water rights retained with it are used. I'm sure folks pay pretty close attention to fed policy changes.
Back in the seventies I shopped for land in Wyoming and Montana some, if water rights were included with even relatively small acreages it was much more desirable land. Oddly some of the areas got saved from getting chopped up when big money came in and bought ranches whole just to use more or less as vacation toys. Funny world.
Luke
There is water on BLM ground, but most of what is there is claimed water by agricultural users, both upstream and downstream. The Fremont, Muddy, and Dirty Devil Rivers are what come out of the drainages I'm most familiar with and I would guess the water in those streams is wholly claimed. What is called a river here would barely rate mention in other areas of the country. I can step across the Fremont about anyplace, same with the Dirty Devil and the Muddy. Just got to be careful of the quicksand. This country is extremely dry, both the high country and the deserts. I don't know that folks from other parts of the USA really understand how dry this country is. I have a well for my house and it produces about 3 gallons per minute of bad tasting water. That's what I run the house on, washing and cooking, and that's pretty much it. Some have a bit more than I do, but others don't or rely on cisterns for a bit of potable water.
The Fed Gov't is very careful with regard to their relations with locals. Locals and the Feds have never been on good terms, never. Officers of the BLM, Forest Service, and Parks are tolerated, but never accepted as members of the community. Even outsiders are better received. Of course the world is changing, and no where more than in the west. One day, the move ins will outnumber the locals and then everything will be different. I've watched that process up north and it is interesting. The move ins will have their revenge and it takes a while for things to balance out.
Luke,
Are you referring to the 22k acres of corn production that I calculated? Please note that's 22 thousand acres, not 22 million acres.
Take 1 million barrels per day of oil, multiply by 2 barrels of water per barrel of oil, 42 gallons per barrel, and 365 days per year. Divide by 168 gallons per pound of corn, 56 pounds per bushel, and 150 bushels per acre per year = 22,000 acres of corn production.
No the the 22 million acres is more or less what the BLM manages in Utah. I didn't look past the google search page as one rough number was enough to throw out there so Freemont knew what I was asking about. Total fed managed acreages in the state would be significantly higher as there is lots national forest land up and down the Rockies. No inclination to look it up right now.
Fremont,
Are owners free to sell their land and water rights to anyone, or do the Water Companies have veto rights, or rights of first refusal?
I'm free to sell to anyone I want. But, before a potential buyer signs the papers, attendance at the annual "Ditch Meeting" ought to be required. I doubt any sane soul would commit after an afternoon with the neighbors discussing water.
....."Whiskey's for drinking, Water's for fighting".
Couldn't remember that phrase, been a while since I looked at property where water rights were part of the mix. Any proposed developmnents in your neighborhood that come to your mind where water rights were successfully used as a rallying point by the development's opposition? No doubt the nature of the withdrawl and whether or not, how much of and the quality of the withdrawn water that re-enters the system locally are extremely important considerations and get lots of attention at public comment sessions locally when EI statements and the like run through their process.
I live in a state with more federal land than any other. Actually the federal acreage in Texas is about the same as private acreage in Alaska. Not a whole lot of either. Those who have not been around a federal permitting process don't understand how easy it can be to slow or stall the process as it navigates its flow chart--so many places to send it on a back loop.
Which makes more sense: using 2,500 gallons of water to produce one pound of $6 beef, or using it to produce 1,250 gallons of $3 fuel?
First off, I didn't cite that the water was a fatal issue, only that is is problematic. And that is a fact since this is such an arid environment.
Second, water that is used for beef for irrigation can be recycled and end up back in the water system. Water that is going to be used for retorting will have to ultimately be disposed of (although it may be recycled several times in the process).
that is is problematic. And that is a fact since this is such an arid environment.
I think this is a case where our intuition tells us one thing (water should be scarce in a desert-like area) and the reality is very different.
First, Colorado total water consumption at around 14 billion gallons per day (or about 333M bpd!) is 7th largest in the country, only behind much larger states like California, Texas and New York - per capita consumption is even higher relative to other states - look at the chart on the 2nd page here: http://pubs.usgs.gov/fs/2009/3098/pdf/2009-3098.pdf
2nd, it's almost all relatively low value agricultural irrigation. The water prices are almost zero (much less than .1 cents per gallon). The value of oil from oil-shale would be roughly 2,000 as large as the value of the food that might be produced with that water. That won't change significantly even if the farmers use the water slightly more efficiently (recycling isn't really that significant for corn farming - heck, a large percentage of the irrigation water simply evaporates).
Given the difference in value added, oil production will always be able to very easily out-bid agricultural uses for water. Heck, oil producers could afford to pay 10 cents a gallon, which is at least 100x-1,000x what ag water goes for.
Let me put it another way – the amount of water needed for 1 million barrels per day of oil could come from a 22k acre corn farm. We can compare that to the 40M! acres for ethanol...
Make sense?
Most of the water used for in situ shale oil production goes to power plant steam condensation. This amount depends strongly on the generation method. It returns to the atmosphere and falls as rain somewhere else. Water used in some processes for "steam cleaning" of the rock will be recycled, but indeed ultimately must be disposed of. Water used in upgrading and refining may end up contributing hydrogen to the fuel, and this eventually returns as water as part of the combustion emissions. I do not yet have full data on how much water in refining and upgrading processes eventually must be disposed of. However, most of the water will ultimately return to the hydrologic cycle. Water produced from heating the rock (not part of standard ground water) can be used in the process, so reduces the primary water requirement.
How much water is used by the Shell "freeze" approach, excluding power generation?
My numbers show 1-2 barrels of water per barrel of water, using some especially conservative values to be sure I covered the reasonable range. Shell suggests that the process might be a net water producer on site, and this is reasonable especially in the zones that have nahcolite (natural baking soda) present. My estimates have gotten lower with every improvement I have made to the model. The Shell freeze wall is maintained by circulating liquid ammonia through the freeze wall borehole pipes, and hence uses only the water from power generation to run the pumps.
So, the Shell freeze approach would use no water inputs at all, if wind power were used?
Do you see any obstacles to using wind power for the Shell approach?
The comparison is very nice. I never thought that US have billion of oil but what I'm more eager to know is the data of estimate total oil in Saudi Arabia.
I'd be surprised if that 4:1 estimate is correct. Long ago I was an undergrad student with a part time job in a chemical catalysis lab. The lab had a series of 3 test chambers built along an outside wall of the building. The wall between these and the rest of the lab was made of 1/2" thick steel. The external wall was designed to blow off in event of an explosion. Each chamber had a fixture to hold a "bomb" - a small thick steel walled container that we put samples in under very high pressure and temperature to run coal liquifaction experiments. One day the professor stopped by and handed me a dark colored piece of rock and said "a friend of mine brought it back from Colorado, see if you can get any oil out of it", laughed, and walked away. A few days later he stopped by and asked if I'd run the test, I said yes, and I didn't get anything out of it. He laughed, said he didn't think I would, and walked away. He later said it was "oil shale."
You are only about three centuries behind science in not being able to extract oil from oil shale. A patent was issued for a process in the 1600s in England. The French were extracting oil from oil shale in the 1830s. Oil shale was produced in Scotland from the 1860s until the 1950s. The Estonians and Chinese have been doing it since the 1920s. 5 million barrels were extracted by Union Oil in Colorado in the 1980s and 1990s. Petrobras has been extracting oil from oil shale since the 1990s. I don't know what test you performed, but it apparently was not one that worked on oil shale. Note that kerogen is, by definition, organic matter from which hydrocarbons cannot be extracted using normal petroleum solvents.
Two guys are drowning as their boat sinks. they struggle madly to keep their heads above water, , but instead of trying to lash together the flotsam to make some sort of float, they spend their last joules of energy arguing about whether the water is salt or fresh.
They're dead either way. So it is with carbon- any kind will do us in, so what's all this nitpick about?
Wimbi, guess you must be one of those rogue environmental activists who are being quietly supported by an administration not enthusiastic about oil shale... How much they paying you?
On the other hand one shouldn't expect that the Director for the Center for Oil Shale Technology and Research at the Colorado School of Mines would understand that the economy is actually a wholly owned subsidiary of the environment because his salary depends specifically on his not understanding it! At least we don't have to second guess his agenda.
Disclaimer: I find that terms like environmental activist have long ago lost all meaning in any kind of serious adult conversation due to their having been hijacked for the purposes of insulting or scapegoating someone who disagrees with the speakers views or agenda. To me the use of such a term is already a serious red flag!
One could find some examples of 'Conservative' past administrations who took seriously their responsibility with regards the protection of the environment and the commons. Quite frankly, I highly doubt that the current administration fits the description of being environmentally concerned, especially with respect to the consequences of fossil fuel extraction and use such as climate change, sea level rise and ocean acidification. At most they have paid lip service to those issues. Then again the term 'Conservative' has also long ago lost it's original meaning.
We are left with a society gone completely insane! Facts and reality have ceased to matter! It seems that a 6 degree celsius increase in global temperature by the end of the century is not something that we think should be avoided at all costs. It seems that it has instead become a goal to be achieved!
What! Fred is sane again? Ah, well, what can we expect.
The real puzzle us saxons have to got to solve is how come the hungarians ended up with all the brains?
I still use environmental activist to refer to someone who is active on environmental issues, not as an insult. I do find that many times they are willing to exaggerate the facts in their favor, but I find the same in conservative activists. So I am equally opposed to those who continue to fight a rearguard action against the scientific basis for demonstrable anthropogenic climate change, as well as those who continue to contend that evolution is just a theory. I have been talking about the critical balance of energy-environment-economics for longer than politicians have. And my funding to do fundamental geologic research on oil shale has simply introduced me to the full debate on this topic. I voted against my economic interest in November. This commenter does not appear to be interested in anything but ad hominem attacks, one of the oldest logical fallacies identified by the ancient Greeks. Everything I discussed is factual information that stands independent of who I am. Got facts that refute those? Bring 'em on.
Evolution is just a theory. That's why it's true and so powerful. Wink-wink, nudge-nudge.
Hi Jerry, welcome to the OilDrum. I hope you can survive the inevitable flak you'll get here because I appreciate your point of view. Jerry's web page: http://geology.mines.edu/faculty/jboak.html
Then perhaps you might start by not attempting to tar individuals with monikers such as 'ROGUE' when referring to people who are active in promoting saner environmental practices across the board. There are some who might consider such a term to be an ad hominem attack as well! And To further insinuate that these same people are in some way supported by a a Government that is against developing fossil fuel reserves, IMHO, sounds like a bit more than a stretch of credulity! That kind of commentary and remarks will certainly undermine any credibility you may have and make you sound biased and unreasonable! Disclaimer: I personally don't call myself an environmentalist because I find the term to be almost meaningless in the current political climate. To be very clear I wasn't disputing or questioning your expertise in your field.
Nothing personal here, but the facts at this point are overwhelmingly in support of the notion that our industrial civilization, based on the use of fossil fuels is one of the main causes of global climate change. So whether you or anyone else likes it or not the truth is we can't continue on our present path. So I'm glad to hear that you are interested in promoting a science based discussion on the issues regarding the critical balance of energy-environment-economics! I'm sure I don't have to remind you that the economy is a wholly owned subsidiary of the environment. One of my greatest concerns is ocean pH, I've been diving on coral reefs since the 70s if you'd like I'll take you for a tour of my local reefs! They can't handle any more abuse of any sort, least of all more CO2.
I am still looking for a place where I used the term "rogue" for environmental activists. I have tried not to use the work since Sarah Palin popularized it. As they are using the same rhetoric, I do not find it incredible that environmental groups and the Salazar Interior Department are in significant agreement, which is what I said. Plenty of people have suggested that the lawsuit that drove revision of the Oil Shale and Tar Sands PEIS was settled too easily by the BLM. The actions of the BLM in its latest PEIS remove 90% of the richest resource from consideration for leasing, while leaving in thousands of acres too lean to be productive, despite the agency's assertion that the new USGS resource estimate was one of the primary reasons for revision. Control of the rate of leasing could, and has been, achieved by the BLM's process, without limitations on choice. Oil shale production takes serious commitment, and long term development. It is unlikely to be subject to a land rush. Thus the only effect of the extreme restriction in available land in the Adminstration's PEIS is to limit technical choice for which land would be most effective to initiate such a process. If it will take six years of bureaucracy and legal wrangling to make each 25,000 acres available, the Administration's position looks like a NIMTOO (Not In My Term Of Office) approach, and an attempt to shut down oil shale development while pretending to support research.
I also am a diver (only since the 1980s), and worried about reef destruction. I think we should proceed to tax carbon emissions, and apply the proceeds to research on mitigation strategies, including carbon minimization, sequestration, and substitution. I don't think shutting down potential energy options by fiat or starving them by bureaucratic burdens is the appropriate approach to achieve that result.
jeremy - "I don't think shutting down potential energy options by fiat or starving them by bureaucratic burdens is the appropriate approach to achieve that result." I agree...particularly since I suspect as the really serious aspects of PO eventually manefest themselves. Not only will those barriers be removed but many other environment/AGW defenses will be castrated in an attempt to maintain BAU. Some folks think we're in bad shape now. IMHO these will be looked at as the good ole days down the road. Coal will become more dominant despite ever increasing evidence of the effects of AGW. Not only will fed lands curently out of play be put back on the market but the govt may even sweeten the deal with some big tax breaks.
Yes: I have no doubt the American public will do anything to eventually keep PO at bay as long as possible.
The average gallon of conventional crude now requires 14,300 BTU/gal.
Where does that info come from?
To those who are written the informative posts here.
This is an incredible discussion.
My areas of expertise are astrophysics, plasma fusion physics and genomics. Because of this I do not have much to add to the discussions, but I am able to follow the threads when I lurk.
I just want to say this is one of the best discussions I have seen and I want to thank the posters for their time.