Monday, November 26, 2007

"Peak Oil" Myth Debunked Again

via Canadian (?) Globe and Mail, a very illustrative article reporting on a US government report again debunking the "Peak Oil" myth that the world is running out of petroleum. (HT: McQ of QandO fame) The real facts are that there is more oil left in the ground in North America than we've removed in all the years of pumping oil out of the ground.

"On the one hand, it says, the country has already consumed, in 150 years, 446 billion barrels of its own fossil-fuel endowment. On the other hand, it says, the country has 8.59 trillion barrels left - or more "oil equivalent" than the rest of the world combined. More than 95 per cent of America's oil reserves, in other words, are still in the ground."

The key here is the word "oil equivalents" - resources like oil shale and tar sands from which black gold can be extracted, albeit at a higher price than sweet light Texas crude. There are 3.5 trillion barrels of such resources in Canada alone, and the US also has a 260 billion ton supply of coal, which can be (and has been since the WW2 - note Nazi Germany) liquified as an unconventional fuel supply economically at world oil prices as low as 40-50 dollars a barrel. The US coal alone could supply the US electricity needs for the next 250 years at the current usage of 1.1 billion tons per year. Who compiled the report, you ask? Your US Congress via the much maligned Energy Act of 2005, that's who.

"Mandated by the U.S. Energy Policy Act of 2005, the 11-member Strategic Unconventional Fuels Task Force submitted its final report in September. Its members include the U.S. secretary of energy, the secretary of defence and the governor of Colorado, Bill Ritter, who was in Alberta just last week checking out oil sands technology partnerships."

The report indicated that the US could supply over a third of its fuel needs from these unconventional sources by 2035, and the US military could switch its 300+ million barrel a day fuel habit to these sources by as early as 2011. The report indicates the US could save as much as $130 billion a year in import costs by swwitching to these oil alternatives, reducing imports to around 3.65 million barrels a day, one quarter of current levels.

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