May 25, 2017 Disclaimer: Please read.
Statements and opinions expressed in articles are those of the authors, not Truthdig. Truthdig takes no responsibility for such statements or opinions.
The New ‘Golden Age of Oil’ That Wasn’t
Posted on Oct 5, 2012
By Michael T. Klare, TomDispatch
This piece originally appeared at TomDispatch. Read Tom Engelhardt’s introduction here.
Last winter, fossil-fuel enthusiasts began trumpeting the dawn of a new “golden age of oil” that would kick-start the American economy, generate millions of new jobs, and free this country from its dependence on imported petroleum. Ed Morse, head commodities analyst at Citibank, was typical. In the Wall Street Journal he crowed, “The United States has become the fastest-growing oil and gas producer in the world, and is likely to remain so for the rest of this decade and into the 2020s.”
Once this surge in U.S. energy production was linked to a predicted boom in energy from Canada’s tar sands reserves, the results seemed obvious and uncontestable. “North America,” he announced, “is becoming the new Middle East.” Many other analysts have elaborated similarly on this rosy scenario, which now provides the foundation for Mitt Romney’s plan to achieve “energy independence” by 2020.
By employing impressive new technologies—notably deepwater drilling and hydraulic fracturing (or hydro-fracking)—energy companies were said to be on the verge of unlocking vast new stores of oil in Alaska, the Gulf of Mexico, and shale formations across the United States. “A ‘Great Revival’ in U.S. oil production is taking shape—a major break from the near 40-year trend of falling output,” James Burkhard of IHS Cambridge Energy Research Associates (CERA) told the Senate Committee on Energy and Natural Resources in January 2012.
Increased output was also predicted elsewhere in the Western Hemisphere, especially Canada and Brazil. “The outline of a new world oil map is emerging, and it is centered not on the Middle East but on the Western Hemisphere,” Daniel Yergin, chairman of CERA, wrote in the Washington Post. “The new energy axis runs from Alberta, Canada, down through North Dakota and South Texas… to huge offshore oil deposits found near Brazil.”
Square, Site wide
It turns out, however, that the future may prove far more recalcitrant than these prophets of an American energy cornucopia imagine. To reach their ambitious targets, energy firms will have to overcome severe geological and environmental barriers—and recent developments suggest that they are going to have a tough time doing so.
Consider this: while many analysts and pundits joined in the premature celebration of the new “golden age,” few emphasized that it would rest almost entirely on the exploitation of “unconventional” petroleum resources—shale oil, oil shale, Arctic oil, deep offshore oil, and tar sands (bitumen). As for conventional oil (petroleum substances that emerge from the ground in liquid form and can be extracted using familiar, standardized technology), no one doubts that it will continue its historic decline in North America.
The “unconventional” oil that is to liberate the U.S. and its neighbors from the unreliable producers of the Middle East involves substances too hard or viscous to be extracted using standard technology or embedded in forbidding locations that require highly specialized equipment for extraction. Think of it as “tough oil.”
Shale oil, for instance, is oil trapped in shale rock. It can only be liberated through the application of concentrated force in a process known as hydraulic fracturing that requires millions of gallons of chemically laced water per “frack,” plus the subsequent disposal of vast quantities of toxic wastewater once the fracking has been completed. Oil shale, or kerogen, is a primitive form of petroleum that must be melted to be useful, a process that itself consumes vast amounts of energy. Tar sands (or “oil sands,” as the industry prefers to call them) must be gouged from the earth using open-pit mining technology or pumped up after first being melted in place by underground steam jets, then treated with various chemicals. Only then can the material be transported to refineries via, for example, the highly controversial Keystone XL pipeline. Similarly, deepwater and Arctic drilling requires the deployment of specialized multimillion-dollar rigs along with enormously costly backup safety systems under the most dangerous of conditions.
All these processes have at least one thing in common: each pushes the envelope of what is technically possible in extracting oil (or natural gas) from geologically and geographically forbidding environments. They are all, that is, versions of “extreme energy.” To produce them, energy companies will have to drill in extreme temperatures or extreme weather, or use extreme pressures, or operate under extreme danger—or some combination of all of these. In each, accidents, mishaps, and setbacks are guaranteed to be more frequent and their consequences more serious than in conventional drilling operations. The apocalyptic poster child for these processes already played out in 2010 with BP’s Deepwater Horizon disaster in the Gulf of Mexico, and this summer we saw intimations of how it will happen again as a range of major unconventional drilling initiatives—all promising that “golden age”—ran into serious trouble.
Perhaps the most notable example of this was Shell Oil’s costly failure to commence test drilling in the Alaskan Arctic. After investing $4.5 billion and years of preparation, Shell was poised to drill five test wells this summer in the Beaufort and Chukchi Seas off Alaska’s northern and northwestern coasts. However, on September 17th, a series of accidents and mishaps forced the company to announce that it would suspend operations until next summer—the only time when those waters are largely free of pack ice and so it is safer to drill.
New and Improved Comments
Right Skyscraper, Site Wide
Right Internal Skyscraper, Site wide