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A Tough-Oil World

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Posted on Mar 14, 2012
Azzazello (CC-BY)

By Michael T. Klare, TomDispatch

(Page 3)

As with all such extreme energy scenarios, increased production in the Arctic will significantly boost oil company operating costs. Shell, for example, has already spent $4 billion alone on preparations for test drilling in offshore Alaska, without producing a single barrel of oil. Full-scale development in this ecologically fragile region, fiercely opposed by environmentalists and local Native peoples, will multiply this figure many times over.

Tar Sands and Heavy Oil

Another significant share of the world’s future petroleum supply is expected to come from Canadian tar sands (also called “oil sands”) and the extra-heavy oil of Venezuela. Neither of these is oil as normally understood.  Not being liquid in their natural state, they cannot be extracted by traditional drilling materials, but they do exist in great abundance.  According to the USGS, Canada’s tar sands contain the equivalent of 1.7 trillion barrels of conventional (liquid) oil, while Venezuela’s heavy oil deposits are said to harbor another trillion barrels of oil equivalent—although not all of this material is considered “recoverable” with existing technology.

Those who claim that the Petroleum Age is far from over often point to these reserves as evidence that the world can still draw on immense supplies of untapped fossil fuels. And it is certainly conceivable that, with the application of advanced technologies and a total indifference to environmental consequences, these resources will indeed be harvested. But easy oil this is not.

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Until now, Canada’s tar sands have been obtained through a process akin to strip mining, utilizing monster shovels to pry a mixture of sand and bitumen out of the ground. But most of the near-surface bitumen in the tar-sands-rich province of Alberta has now been exhausted, which means all future extraction will require a far more complex and costly process.  Steam will have to be injected into deeper concentrations to melt the bitumen and allow its recovery by massive pumps. This requires a colossal investment of infrastructure and energy, as well as the construction of treatment facilities for all the resulting toxic wastes. According to the Canadian Energy Research Institute, the full development of Alberta’s oil sands would require a minimum investment of $218 billion over the next 25 years, not including the cost of building pipelines to the United States (such as the proposed Keystone XL) for processing in U.S. refineries.

The development of Venezuela’s heavy oil will require investment on a comparable scale. The Orinoco belt, an especially dense concentration of heavy oil adjoining the Orinoco River, is believed to contain recoverable reserves of 513 billion barrels of oil—perhaps the largest source of untapped petroleum on the planet. But converting this molasses-like form of bitumen into a useable liquid fuel far exceeds the technical capacity or financial resources of the state oil company, Petróleos de Venezuela S.A. Accordingly, it is now seeking foreign partners willing to invest the $10-$20 billion needed just to build the necessary facilities.

The Hidden Costs

Tough-oil reserves like these will provide most of the world’s new oil in the years ahead. One thing is clear: even if they can replace easy oil in our lives, the cost of everything oil-related—whether at the gas pump, in oil-based products, in fertilizers, in just about every nook and cranny of our lives—is going to rise.  Get used to it.  If things proceed as presently planned, we will be in hock to big oil for decades to come.

And those are only the most obvious costs in a situation in which hidden costs abound, especially to the environment. As with the Deepwater Horizon disaster, oil extraction in deep-offshore areas and other extreme geographical locations will ensure ever greater environmental risks. After all, approximately five million gallons of oil were discharged into the Gulf of Mexico, thanks to BP’s negligence, causing extensive damage to marine animals and coastal habitats.

Keep in mind that, as catastrophic as it was, it occurred in the Gulf of Mexico, where vast cleanup forces could be mobilized and the ecosystem’s natural recovery capacity was relatively robust. The Arctic and Greenland represent a different story altogether, given their distance from established recovery capabilities and the extreme vulnerability of their ecosystems. Efforts to restore such areas in the wake of massive oil spills would cost many times the $30-$40 billion BP is expected to pay for the Deepwater Horizon damage and be far less effective.


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By prosefights, April 25, 2012 at 12:55 pm Link to this comment

Readers may benefit from

Toward Energy Literacy

http://www.energypulse.net/centers/article/article_display.cfm?a_id=2526

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By Jozef Oud, April 24, 2012 at 5:12 pm Link to this comment
(Unregistered commenter)

To quote the last line of this excellent article: Who would want it? Indeed! I certainly don’t. But we are all being forced into this even as clean, sustainable energy is abundant! I’m talking about HYDROGEN, the most common element on the planet. But the technology to use it is being suppressed by the fossil fuel companies. Wake up, people, defend our Earth against the evil greed. Demand we switch to clean energy by investing all that money it will cost to get the oil into renewables. Refuse to pay fuel taxes, break free, we’ve all been held hostage for far too long! Now is the time!

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By diman, March 16, 2012 at 12:02 pm Link to this comment

For those of you interested in the problem, watch the documentary “Collapse” with Michael C. Ruppert.

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By prosefights, March 15, 2012 at 6:54 am Link to this comment

BEFORE THE NEW MEXICO PUBLIC REGULATION COMMISSION

IN THE MATTER OF THE APPLICATION OF NEW MEXICO GAS COMPANY FOR APPROVAL OF 2012 ENERGY EFFICIENCY PROGRAMS AND PROGRAM COST TARIFF RIDER PURSUANT TO THE NEW MEXICO PUBLIC UTILITY AND EFFICIENT USE OF ENERGY ACTS.

NEW MEXICO GAS COMPANY, Applicant.  )

Case No. 11-00369-UT

PROPOSED DECISION OF HEARING EXAMINER

http://www.prosefights.org/nmgco/intervene/hearing/hearing#response

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Clash's avatar

By Clash, March 14, 2012 at 9:18 pm Link to this comment

Yup slim Picken’s buying up as much of the water in the Ogallala Aquifer as he can, so he can sell it back to?

I don’t no about spearing the Earth, and pumping toxic chemicals to cool drills, and hydraulically fracture rock for the gas, but the additives in the water sure taste great, probably good for you to?

Sorta like the Hanford plume.

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By Clash, March 14, 2012 at 5:21 pm Link to this comment

March 11, passed by and I didn’t see any articles here about the emperors plans to back the building of 2 more machines from hell, happy Fukushima day.

I know they say it will all be cleaned up in 30 years, but I think they left some 0’s out of their number.

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By Clash, March 14, 2012 at 5:02 pm Link to this comment

The end of the age of oil, finally? That easy, I don’t think so, not till those who control the resources make the earth a grave.

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