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An acquaintance commented to me the other day that when she sees all of the high tech drilling apparatuses spread all over the world and in the oceans, that is evidence to her that fossil fuels are doomed. Her reasoning seems solid. If we need fancier and fancier equipment to get access to these clearly “limited resources” then it must be the case that they are nearing the end of their availability to us.

You might think that. 

But you might also remember that the cost of drilling for a particular barrel of oil today in the most inconvenient of locations, such as out in the ocean in 6,000 feet of water and in a well 6,000 feet below that sea floor, costs less than it cost us to drill for the earliest barrels 150 years ago in Pennsylvania. You may also enjoy a somewhat snarky analogy. I like watching Deadliest Catch. And the boats they use to ride around the Bering Sea are all over 100 feet long beasts of steel with huge diesel engines – technological marvels. Since ancient ocean-going vessels ranged from outrigger canoes to oak-planked, resin-soaked sailing ships, are we to infer from the beautiful fishing vessels of today that we are running out of ocean?

Of course, there seems to be a limited amount of oil and other fossil fuels in the ground, though a researcher at Cornell believes there might be a geologic process that produces new hyrdrocarbons. But that is sort of irrelevant, especially if that “limited” amount is rather large, as more signs point to there being. For example, there are about 1.3 trillion barrels of known oil reserves in the ground. But that is at current prices and technologies. If we expand this to include expected amounts of oil including from unconventional sources, you get close to 10 trillion barrels of oil alone. If oil consumption stays around 30 billion barrels per year, and this is all recoverable, we’re talking over 300 years of just oil “left.” If we include coal that number grows … a lot.

And then there is natural gas. With the increased promise of accessing methane ice from the sea-floor, there is by some estimates up to 3 million times more natural gas energy available that all of America’s annual energy needs right now. Those kind of figures are, in effect, indicative of resources that do not run out. And with better technology, we get closer, not further, from realizing this – contrary to what my acquaintance’s claim was.

3 Responses to “Technology and the End of Oil”

  1. ZT says:

    I find it odd how the “E”nvironmentalists (to borrow your terminology) are always insistent that oil supplies are low, when the best argument for a carbon tax or cap and trade is that they are high.

    Of course, there’s the converse implication. Even if carbon sensitivity is on the low end of current predictions, it’s going to start adding up. Emissions are on a downward trend right now because newer technology is increasing access to natural gas, but for all we know in 20 or 30 years new technology won’t be unlocking cheap coal or dirty crude deposits?

  2. Harry says:

    And that’s just proven reserves, WC.

    I remember several years T. Boone Pickens did an interview on Bloomberg Business channel where he stated, we already know where all the oil is.

    Now, I have the greatest admiration for Mr. Pickens, the king of Mesa Petroleum. (I remember the cavalier Bloomberg interviewer calling him Boone, as if they were somehow peers.)

    But at the time it had been reported that Mesa was fracking in Arkansas. Mr. Pickens suspected there was methane down there, probably because his production research engineers had located a promising place to spend a lot of money to drill. But even the wily Mr. Pickens did not know for sure whether there would be oil, too. I bet Mr. Pickens is not about to tell anyone where he suspects there is oil or gas or a mother lode of gold nuggets.

    Yes, in the very long run we will run out of everything, assuming we are there. But year after year, proven reserves rise. Right now ExxonMobil uses $55 per barrel for its long-range exploration planning. If they were to use a higher figure, like the $150 per barrel that some experts have forecast as the new normal, then they would be more aggressive. But they know that prices fluctuate and that marginally higher prices stimulate supply.

  3. Harry says:

    Yes, another six hundred years of coal, and that is from the WSJ thirty years ago. Coal has its drawbacks, which WC has discussed before; but those drawbacks have been dealt with by technology, like scrubbers that eliminate soot and sulfur dioxide. One has to deal with the ash, which is handled far better than in F. Scott Fitzgerald’s day when one passed the ash heaps on the train to Long Island.

    Get rid of coal soon, and you force the civilized world and the world about to be civilized into an impossible situation. Do we really want to go back to the eighteenth century when peat was the fuel of choice, and poverty was the norm?

    Right now US coal producers are getting stiff competition in the market from natural gas, which at current prices delivers more btu’s per dollar invested.

    So, in a thousand years the human race has time to figure out how not to rely on carbon, including hydrocarbon energy, and so does the plant kingdom have time to adapt to a zero-CO2 world. Wait — we are made of carbon too, no?

    This segues into an evaluation of the philosophy of Peter Singer.

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