Powering the Future: A Scientist's Guide to Energy Independence

by Daniel B. Botkin

  How much petroleum is there, and how long will it last?

  These are straightforward questions, so one might expect them to have straightforward answers. Don’t petroleum geologists and oil corporations know how much oil is in the ground, how much they can sell in a year, and therefore how long oil will last? Wouldn’t this be a basic part of an oil company’s business plan?

  Unfortunately, it’s not that simple. As economists and petroleum geologists will tell you, there is always more in the ground than you can get out, and the percentage you get out depends on how hard you want to work, or how much you are willing to pay, to get it. When oil was very, very cheap, around the first decades of the 20th century, it wasn’t worth much to develop new technologies to get every last drop when the initial gusher and subsequent flow eased and the oil no longer flowed freely out of the ground. Today, we have many ways to push more of the underground oil to the surface or separate it from the rocks that hold it. So the answer to how much oil is in the ground is: It depends on what you are willing to pay.

  As to the second question—how long will Earth’s petroleum last?—economists will tell you that rather than being drained to the last drop, petroleum will eventually become so rare and so expensive to get out of the ground that it will no longer be useful as fuel. People may collect it, the way they collect other precious minerals, and display little jars of the black goo on their coffee tables as decorations and as evidence of their wealth. The real question therefore is not when every drop of oil will be gone but when it will no longer be economically worthwhile to extract it.

  What will raise the price of oil and thereby make it worthwhile to try harder and harder to get it? One standard answer is that the price of oil will rise rapidly when peak production is reached—that is, when discovery of new oil declines. Another economic turning point is when the rate of supply drops significantly below the demand.

  As petroleum reserves shrink, they get harder and harder to find

  We’re using more and more petroleum and finding less and less of it. Indeed, petroleum geologists suggest that we’re going to run out of petroleum in the next few decades. History seems to be on the side of this viewpoint. In 1940, five times as much oil was discovered as consumed. Forty years later, in 1980, the amount of petroleum discovered just about equaled the amount consumed. And by the turn of the 21st century, world consumption of petroleum was three times the amount that was discovered.9 Based on this history and our knowledge of the kinds of rocks where petroleum can be found, it seems likely that oil production in the United States will end in 50 years or at least by the end of this century, and world oil production soon after.

  To understand how petroleum geologists think about these things and make calculations, you first need to understand the terms resources and reserves. A petroleum resource is the oil that can be extracted economically. A reserve is part of the resource, the part that, at the time it is evaluated, is judged to be eventually extractable both legally and economically. Proven reserves are those that have been determined to be legally and economically extractable right now. (The proven reserves idea leaves open the possibility that as prices for petroleum rise, it may become economically worthwhile to extract oil from reserves that are now considered too costly to use.)

  Today, petroleum geologists estimate that the world’s proven reserves are 1 trillion barrels (42 trillion gallons), and that total reserves—oil that eventually will be legally and economically accessible—are probably 2–3 trillion barrels. These estimates are based on a lot of geological knowledge as well as the location and size of existing oil wells. In fact, there is a wide range in the estimates of how many barrels of oil are now or soon will be considered proven reserves. For example, the U.S. Energy Information Administration reports values from 1–4 trillion barrels.10

  In predicting when the oil supply will become a serious problem, petroleum geologists focus on the peak oil point—the time when one-half of Earth’s oil has been exploited. This is usually projected to occur sometime between 2020 and 2050, although a variety of experts believe it has occurred already in the United States. The time of peak oil production is important because we can assume that when that point is reached, the price of oil will rise rapidly. The Energy Information Administration presents a range of estimates for the time of world peak oil production, from as early as 2020 to as far into the future as 2121.11

  The implications are huge about how much time this gives the nations of the world to prepare for a planet without petroleum. Given the way most people and societies go about planning for events that they hope won’t occur until far in the future, it seems likely that if peak oil production is expected to occur a century or more from now, little will be done to move away from fossil fuels in the next year or even the next decade, and when the time comes we’ll all just muddle through. This will be unfortunate, because moving away from petroleum (and the other fossil fuels) is a good idea for reasons other than direct energy supply. For example, we could stop worrying about international conflicts over oil, avoid direct pollution from toxins given off by petroleum, and reduce the release of greenhouse gases. Those who place a high priority on a healthful, pleasant, and sustainable environment would therefore prefer to be told that peak oil is almost upon us, so that nations will be spurred to action.

  For a more straightforward estimate of when the world will run out of petroleum, here are some numbers. Worldwide, people use about 30 billion barrels of oil a year (210 gallons a year per person). Conservatively—not taking into account the maximum potential increase in automobiles in China and India—worldwide consumption is expected to rise to about 50 billion barrels a year by 2020, which means that the whole world will use up today’s proven petroleum reserves in about 20–40 years and use up the total estimated reserves in about 60 years. Since not all our many uses of petroleum may be readily adaptable to other fuels, this puts a lot of time pressure on all nations to get something going quickly to replace petroleum, especially for transportation.

  However, there is another point of view, which is that conventional petroleum geologists greatly underestimate both the available amount of petroleum and how efficiently oil can be gotten out of wells. This viewpoint was well expressed in the Wall Street Journal op-ed piece titled “The World Has Plenty of Oil,” by Nansen G. Saleri, president and CEO of Quantum Reservoir Impact, in Houston, and former head of reservoir management for Saudi Aramco.12

  Mr. Saleri says that present oil mining technology gets only one-third of the oil out of a well; the rest clings to the rocks and is just held too tightly for current pumping methods to get it out. “Modern science and unfolding technologies will, in all likelihood, double recovery efficiencies,” he writes. “Even a 10% gain in extraction efficiency on a global scale will unlock 1.2–1.6 trillion barrels of extra resources—an additional 50-year supply at current consumption rates.”13

  Mr. Saleri argues that rising prices for petroleum will fuel technological development that will increase extraction efficiency. Two major oil fields in Saudi Arabia are already yielding two-thirds, rather than one-third, of the oil out of the wells. Mr. Saleri writes that the total resources are 12–16 trillion barrels, not the 1 to 3 trillion barrels of conventional estimates, and that 6–8 trillion of these total resources are in conventional wells, the rest in “unconventional” sources, shale oil and tar sands, from which it is difficult and environmentally costly to get oil. Present attempts to recover oil from these unconventional sources are disrupting and polluting land (more about that later). Even with his optimistic assumptions, he estimates that peak oil production will be reached between 2045 and 2067—in 38–59 years.

  Geography is against us

  Unfortunately for most of us, petroleum reserves are not distributed evenly around the world. Quite the opposite; they are highly concentrated (Figure 1.4) and, worse yet, concentrated in parts of the world that, on the whole, are not the ones that use the most petroleum today but will likely require m
ore in the future (Figure 1.5). The Middle East has 62% of the world’s oil reserves (Figure 1.6); the rest of Africa 9.7%; South and Central America 8.6% (most of it in Venezuela and Brazil); the Russian Federation 6.6%. North America has just 5%, half of it in the United States.14 So, as Figure 1.4 makes clear, oil reserves are extraordinarily concentrated geographically.

  Figure 1.4 The world’s known oil reserves (2006).15 (Source: BP Statistical Review of World Energy, June 2007; London, British Petroleum Company)

  Figure 1.5 Oil consumption per capita (metric tonnes, 2006). Compare the consumption with known reserves. (Source: BP Statistical Review of World Energy June 2007; London, British Petroleum Company)

  Figure 1.6 Middle Eastern nations have 62% of the world’s available oil. Most of this is in five nations: Saudi Arabia (with more than 20%), Iran, Iraq, Kuwait, and the United Arab Emirates.16

  It would be naive to think that the lopsided geographic distribution of petroleum will not continue to create international conflicts. As long as the United States and other countries without vast oil reserves continue to depend so heavily on petroleum, these conflicts are likely to increase, which is all the more reason to turn to other sources of energy as soon as possible.

  Although the Middle East dominates world oil reserves, most of that oil goes to Europe, Japan, and Southeast Asia, whereas the United States imports a lot of oil from Canada, Mexico, and Venezuela (Figure 1.7). Obviously, the more oil the United States imports, the more vulnerable its economy is to the reserves in other nations and to political and environmental events that limit or prevent this importation. Given the importance of abundant energy for a vibrant economy and society, greater energy independence is an important goal, but for petroleum this is not and will not be possible for the United States.

  Figure 1.7 Where the United States gets its oil. (Source: Energy Information Administration, 2008)17

  Where might new oil reserves be found?

  Recent discoveries of oil have been primarily in the Middle East, Venezuela, and Kazakhstan.18 Ironically, global warming may change this, since less ice in the Arctic may mean more opportunities for oil exploration where it was difficult before. Also, while at present drilling for oil in Arctic waters is mostly limited to a depth of 300 feet and in some cases 2,000 feet, new ships will make it possible to drill for oil in water 12,000 feet deep.19 One estimate suggests that 400 billion barrels of oil may be found in the Arctic oceans.20

  Although this is a lot of petroleum, at current rates of use it would add only eight years to the time we have before the world runs out of oil.21 And there’s a potential downside: More global warming provides more sources of oil—for example in the Arctic, which produces more greenhouse gases, which lead to more global warming.22 Then, too, there is already plenty of concern about oil spills and their effects on ocean ecosystems, sea and shore birds, and fisheries, and the ability to drill much deeper in a much larger area increases the risk of drilling-caused spills.

  Two unconventional sources of oil: oil shales and tar sands

  As explained earlier, petroleum under pressure from underground rocks fills pockets in the rocks. But in addition, some muds trap petroleum as they form into shales, resulting in a dense rock filled with oil. The oil is tightly bound within the rock and can be released only if the shale is heated to 900°F. At this temperature, a ton of shale may yield as much as 14 gallons, and three tons of shale would be needed for each barrel of oil. Heating three tons of rock to 900° takes a lot of energy and leaves behind a lot of crushed rock. Much of this rock is obtained from surface mines, and even more energy is needed afterward to restore the damaged land—restore it as much as possible, that is. Not only are oil shales a highly polluting energy source, destructive to the land, but also their net energy yield is low compared to conventional sources of oil.

  Tar sands (sometimes also called oil sands) are geologically similar to oil shales, but the petroleum impregnates sand or clay rather than mud. Again, the petroleum is so completely mixed with the inorganic material that one can’t pump the oil out. The sand has to be mined, primarily by strip mining, and then washed with hot water. As with oil shales, a mess remains—in this case dirty water as well as tons of sandy rock. Tar sands are said to yield as much as one barrel for about every two tons processed.

  Those who believe there is a lot more oil out there than 1–3 trillion barrels are basing their estimates partly on what could be gotten from oil shale and tar sands. An estimated 3 trillion barrels of oil exist in oil shales and about the same in tar sands. Together, these massive but difficult-to-use sources could triple the amount of oil available, if all of it could be recovered.

  Much of the world’s known tar sands and oil shales are in North America. The United States has two-thirds of the known world oil shale, and it is estimated to contain 2 trillion barrels of oil. Some 90% of U.S. oil shale is in the Green River formation underlying parts of Colorado, Utah, and Wyoming and extends over 17,000 square miles, an area larger than Maryland.23 Canada has an estimated 3 trillion barrels of oil in tar sands, most of it in a single huge area near Alberta now called the Athabasca Oil Sands. Since so much energy is required to get the oil out of these rocks, the net yield would not be nearly as great as from conventional oil wells. Still, the government of Alberta states that tar sands yield six times the amount of energy required to process them.24

  Oil shales and tar sands are already causing major environmental controversies, since so much oil exists in them, and since mining and refining it are so polluting. Mining the 2 trillion barrels of petroleum from U.S. oil shales would leave behind 9 trillion tons of waste rock—an amount equal to the weight of 24 million Empire State Buildings. To put this into perspective, in 2007, all the freight transported in the United States weighed 21 billion tons. So it would take all the freight transportation available in the United States about 424 years to move that much waste rock.25

  Three tar sands mines are operating today: Suncor (opened in 1967), Syncrude (since 1978), and Muskeg River of Shell Canada (opened in 2003). They are producing 1 million barrels a day26 and have affected 120 square miles.27 Mining Athabasca Oil Sands takes 2.2 to 5 barrels of water for every barrel of oil.28 Water used for this processing comes from the Athabasca River, which starts in the beautiful Canadian Rockies as the outflow from the Athabasca Glacier. The government of Alberta states that only 3% of the average annual outflow of the glacier is required to process the sands,29 but environmental groups estimate that it will require a quarter of Alberta’s freshwater.30 This water would end up in holding ponds, contaminated by toxic chemicals from the mining and processing: mercury, arsenic, and a variety of organic compounds that are carcinogenic.31

  Effluents from present tar sand operations are being blamed for human and wildlife ailments,32 and the holding ponds present an even greater hazard. According to Professor David Schindler of the University of Alberta, a leading aquatic ecologist, “If any of those tailings ponds were ever to breach and discharge into the river, the world would forever forget about the Exxon Valdez.”33

  Currently, oil production from Athabasca Oil Sands costs between $15 and $26 a barrel, compared with about $1 per barrel from Saudi Arabia’s wells. But when oil prices exceeded $130 a barrel in 2008, mining those tar sands began to sound like economic sense—except for the pollution (at the time of this writing, oil is $72 a barrel).

  Oil shales are not yet in commercial development, but Shell Oil Corporation has invested many millions of dollars in attempts to develop this petroleum source.34 The near future will bring a major battle over North American tar sands and oil shales since they offer huge profits at great environmental costs.

  Growing worldwide competition for a dwindling resource

  International competition for petroleum is growing, in large part because rapidly rising standards of living in India and China are leading to a greater number of automobiles. India now has 5.4 million vehicles, up 500% in just 20 years.35 China has 34 million r
egistered motor vehicles.36 In 2006, sales of personal autos rose 30% in China, to 5.8 million,37 and China’s total vehicle sales reached 7.22 million. To put this into perspective, this is close to half the number of cars sold in the United States in 2007 (about 16 million).38 In 2003, China became the world’s fourth-largest automobile-producing nation, behind only the U.S., Japan, and Germany.39 This increased competition alone is enough to push petroleum prices up. And they’re going to go even higher. The cost of generating electricity with oil (and with natural gas) in the United States has been rising sharply. Domestic electricity cost 20% more in 2006 (the most recent date for which data are available) than in 1995.40