All That You Can't Leave Behind
At a time when the world increasingly fears an approaching peak and subsequent decline in oil production (even if the current economic crisis has temporarily obscured this view), it may be surprising to learn that most of the planet’s known resources are left unexploited in the ground, and that even more still wait to be discovered.
In 2008, just before the economic meltdown that slashed oil consumption, the world consumed around 30 billion barrels of oil per year, or roughly 85 million barrels per day, with the U.S. leading the rush with more than 21 million barrels consumed every day. Our planet’s proven oil reserves are estimated at between 1.1 trillion and 1.3 trillion barrels, more than the amount we have consumed so far, which is less than one trillion barrels.
These 2.3 trillion barrels are only a slice of the Earth’s original petroleum deposits, which the U.S. Geological Survey estimates to be around seven trillion to nine trillion barrels. But with today’s technology, know-how and prices, only part of that oil can be recovered economically and is thus classified as a proven reserve.
The world’s average oil recovery rate today is around 35 percent. That means that about two thirds of the original oil remains underground; that resource is rarely mentioned in the debate on the future of oil. And there is more.
First, proven reserves are only estimates and not fixed numbers. The definition of what can be recovered economically changes as technology develops and as the price of crude goes up. That’s why most oilfields have produced much more than the initial estimates of their reserves assumed, and even more than the initial estimates of their total content. Second, these data do not include unconventional oils, such as ultra-heavy oils, tar sands and bituminous schist, which together are at least as abundant as conventional oil. Finally, only one third of the sedimentary basins of our planet—the geological formations that may contain oil—have been thoroughly explored with modern technologies.
Even a mature oil country such as the U.S., whose oil production has been declining since the 1970s, still holds huge volumes of unexploited oil under its surface. According to a recent report by the National Petroleum Council (NPC), of the 582 billion barrels of known oil, 208 billion already have been produced or proven, leaving 374 billion barrels underground. What’s more, all this oil is only a fraction of the country’s total original amount, which the NPC estimates at more than a trillion (1,124 billion). Meanwhile, U.S. proven oil reserves are 29 billion barrels, and the country’s annual production is about three billion barrels, less than half of the seven billion barrels it consumes every year.
Thus, a country or a company may increase its reserves of black gold even without tapping new areas and frontiers, if it is capable of recovering more oil from known fields. Still, that does not mean that it is easy.
A Rocky Start
Contrary to common belief, oil is not held in great underground lakes or caves. If you could “see” an oil reservoir, you would only notice a rocky structure, in which there seems to be no room for oil. But beyond the reach of the human eye, a world of often-invisible pores and microfractures entrap minuscule droplets of oil, together with water and natural gas.
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24 Comments
Add CommentA word or two about the expected increases in population and demand, especially in China, India and Indonesia, would be helpful. Also, a certain emphasis on Western oil companies seems out of place, but I might be reading more into it than is really there.
Reply | Report Abuse | Link to thisHow are the various estimates arrived at? How reliable are they? Why does there seem to be a lot of disagreement on how much oil there is and how much it will cost? In short, why should we trust Maugeri's estimates rather than others? All his conclusions depend on the answer to that question.
Reply | Report Abuse | Link to thisFossil fuels do no harm under the ground, where they already are. They do once they get into the atmosphere and ocean as carbon dioxide. Therefore, all the industries around them should be phased out of existence.
Reply | Report Abuse | Link to thisClearly, it will require some time, as it is not good to put a lot of people out of work at once. Nevertheless, for the good of the planet, we should be working in that direction.
Another point worth mentioning is that many national producers -- such as in the Middle East, Russia, and Venezuela -- do not have access to the kind of technical expertise required to keep their fields producing. (Usually because they chase away their own talent.)
Reply | Report Abuse | Link to thisThe typical strategy of these governments is to allow foreign companies to develop the fields -- at their own expense -- and then turn around and nationalize the assets. This has happened often enough that one has to wonder how much longer major companies are going to put up with it.
From where I'm sitting, if we see a sudden and disastrous "peak oil" scenario, its origins will be political and not due to a lack of recoverable oil.
I like that this article covers some of the basics of petroleum production and methods of recovering oil; most people are completely unaware as to where oil comes from and how it is produced.
Reply | Report Abuse | Link to thisAnother good article would point out some of the misconceptions associated with oil production and pollution. In California, for example, oil companies are fined millions of dollars for leaking a few measly barrels into the ocean... when twenty miles up the coast, Mother Nature -- through natural oil seeps -- is "polluting" far worse! So how do we fine Mother Nature?
Also, I once heard someone remark that oil operations disrupt wildlife. It's quite the opposite! Wildlife will disrupt oil operations, and animals are clearly undisturbed! Sea lions, caribou, and all other kinds of wildlife love to hang out around the oilfield. A few platforms in California have their own sea lion mascots that sunbathe right alongside drilling operations. =)
The "dirty" and "environmentally unfriendly" image that is associated with the oil industry is largely unjustified. I'd love to see an article debunking those myths.
One last point. The basic error committed by "peak oil" enthusiasts and other Malthusians is that resources are not static, limited quantities. To understand this point, you first have to understand what makes something a "resource."
Reply | Report Abuse | Link to thisResources like oil, coal, and natural gas are not "just there for the taking." Someone must: identify how they can be used in a practical and profitable way; devise a means of economically viable extraction; and create a business model to deliver these products to customers who will benefit from buying it. In other words, nothing is a "resource" until a thinking, reasoning mind has turned it into one!
The true "resource," then, is human ingenuity, which theoretically has infinite problem-solving potential. If oil, coal, or any other kind of resource becomes economically unviable, people acting in their own selfish interests will devise new and profitable ways to meet consumers' energy demands. There is no "faith" involved in reaching this conclusion; markets work in such a way that selfish motives like profit are continually driving innovation.
If you want to ensure that producers will continue producing, you must leave them free to produce. Ingenious people left to their own ends will devise a way to cheaply and efficiently meet energy demands.
Reserves are calculated on a combination of engineering and economic criteria. The best way to think about it that we are all out of $10/bbl oil. We have a small amount of $20/bbl oil, a reasonable amount of $60/bbl oil and all kinds of $120/bbl oil. This is why when prices drop, suddenly reserves drop as well as companies are forced to write down the amount of oil that they can economically recover. And when prices rise, new reserves are added.
Reply | Report Abuse | Link to thisPeople who think that our society would survive for more than 20 minutes without fossil fuels are living fools. Unfortunately, with the EPA now granted unfettered power, we will all get the type of world that only these fools deserve.
When the hydrocarbons will all have been used up, then people will say 'Why didn't somebody do something to save some for future generations?'. It is not using hydrocarbons that is wrong, but the Rate at which we are using them wastefully. We should study now how to extract carbon from CO2. We know how to do it, but like all energy solutions, the answer is to use less energy better. Economy literally means doing more with less.
Reply | Report Abuse | Link to thisThe question is not how to get at the oil that is left but what using all the oil is going to do to the planet. As oil becomes more and more scarace alternatives become more attractive both in exploration and methods in powering our lifestyle. In time greener alternatives will become more commonplace to replace former ditry resources and even dirty resources will become more clean and efficent because laws of supply & demand will force a clena up to save money & resources.
Reply | Report Abuse | Link to thisRight, because the last thing we need is more food for plant life. on the planet.
Reply | Report Abuse | Link to thisHow does it feel to have been successfully brainwashed?
Give the man a silver star. You, sir have nailed it. Energy shortages, like all shortages in any non-subsistence economy are the result of socialist government policies.
Reply | Report Abuse | Link to thisIf oil is difficult to get to, it's because governments make it so.
The only problem with your solution is that it leaves no room for kings, and thus will never be allowed. The past 200 or so years of western civilization are a fluke, not the norm, and a glance at current government trends, fueled by useful idiots like SA and it's global warming junk science show that the fluke is ending, and the norm is returning.
Reply | Report Abuse | Link to thisNo. When the naturally occurring hydrocarbons are all used up, grandparents will tell their children: In my day, we actually dug oil out of the ground instead of scooping it growing it from algae beds, and the kids will get big eyes from total shock and disbelief.
Reply | Report Abuse | Link to thisThat is assuming, of course, a free, capitalist society remains somewhere on the planet. Sadly, the more likely scenario will be something like,
"In my day, the lights stayed on 24 hours a day, and you could heat your home by turning a dial on a little box on a wall."
And the kids, huddling around the little smoking fire of cow chips will shake their heads in disbelief. But at least their health care will be free.
Pretty good overview of the history and possible future of oil recovery, though there seems to be some bias in favor of the big oil companies. (For example, increased nationalization of oil reserves called "worsening").
Reply | Report Abuse | Link to thisWhat I would like to know is which of the proposed technologies for increased oil recovery depend on relatively predictable engineering improvements, which depend on increased price of oil products (also fairly predictable) and which depend on scientific breakthroughs, which may not for a long time if at all.
3-D seismic has been a huge technology in the discovery and analysis of oil and gas deposits. The article alludes to it when it says "...only one third of the sedimentary basins of our planetthe geological formations that may contain oilhave been thoroughly explored with modern technologies. I'm surprised the author does not elaborate on this key difference maker.
Reply | Report Abuse | Link to thisYou need to understand that ENI is a stock company, and very much needs people to believe that there is plenty of oil in the future, in order to keep its price up. You should read the article in precisely the way you would read an article that is put together by a drug manufacturer writing an article about how good their new drug is--with a great deal of skepticism. The author has a major conflict of interest in writing this article.
Reply | Report Abuse | Link to thisOne of the issues about the Kern River technology is that it is no longer new. It is well known by companies around the world. If it was going to have a great and wonderful impact on production around the world, this should already have happened.
(I recently wrote an article about Kern River after visiting the site as a guest of the American Petroleum Institute. My article can be found here. http://www.theoildrum.com/node/5023 Justin L. Higgs, Media Advisor of the Kern River facility sent me this comment about my article: "I saw your work, and have been meaning to email and thank you for the
thoughtfully in-depth coverage of the tour. Your write-ups wow'd a lot of folks. Needless to say everyone over here was very impressed with your coverage." )
The major reason why "easy oil" is "easy oil", is because it is cheap oil to extract. The oil at Kern River is not cheap oil to extract, even though the process is well known, because it takes energy to heat all of the steam used to heat the area sufficiently to be able to drain the oil. The process is at best marginal in today's price environment. If Kern River had to be built today from scratch, it is likely that the resulting facility would be too expensive to be economic at today's oil prices.
The real issue is not easy oil versus difficult oil. It is cheap oil versus expensive oil. The oil that remains to be extracted--for example, the subsalt oil near Brazil--is expensive to extract oil. It is seriously doubtful that technology will materially change this.
The real problem is that the economy cannot withstand the high oil prices that it takes to extract resources such as these. There is considerable evidence that the current economic slump is the direct result of the high oil prices we had through July 2008 and their impact on other resource prices and on food prices. Thus, the current financial crisis appears to be the direct result of peak oil, and the inability of the economy to pay the high prices needed to extract expensive oil.
The author of your article seems to have missed the basics of what is going on today.
This might be a small point but horsehead pumps do not suck oil from the ground..they push it up with a one way valve at the bottom of the well that is connected to the mechanism on the surface which thus bails oil into the upper chamber through this valve. Nomenclature is important if one wants people to accept the main theme that tech will lead to greater recovery of oil, the simple engineering principles also need to be accurate.
Reply | Report Abuse | Link to thisYou should look closely at the estimates and what they are based on. Many countries that are assumed to have a lot of oil keep their data a closely guarded secret. With production having been virtually static for 4 years and discoveries lagging consumption for over 25 years (including almost no confirmed discoveries of any note this year so far), then we should treat claims of untold oil wealth very cautiously.
Reply | Report Abuse | Link to thisThe main measure is rate of production, not total recoverable reserves (for example, Canadian oil sands is a huge resource but will never produce at anything like the rate of a similarly sized conventional field). Another key measure is the ratio of energy out and energy in. It is of little use to extract a barrel of oil equivalent if it takes a barrel of oil equivalent to do so.
An increasingly important aspect is that new fields tend to be smaller, thereby spreading expertise more thinly and increasing costs (since more fields need to be developed for the same return).
Finally, take a close look at estimates of consumption and apply the exponential function appropriately. Please don't include a phrase similar to "that is x years at current consumption rates" as it is a meaningless phrase. Instead, look at how production rates can match consumption, as that consumption grows over time, especially with developing economies wanting their standards of living to rise, and developed economies not wanting to let their standards decrease and still growing their populations for the most part (indeed, population growth is also a key factor - the rate has not decreased, globally, for about 5 years).
When it comes down to it, we live on a finite planet and limits of one sort or another will be reached. Let's hope we can recognise those limits before they hit, if they haven't already.
It is human "ingenuity" that has civilization teetoring on the verge of collapse in the decades ahead. Trees, having solar panels and many other systems we're struggling to emulate, are far more ingenious in their use of energy and recycling
Reply | Report Abuse | Link to this"Scientific" American seems an oxymoron here, with Occi morons projecting their wishes instead of geologic and atmospheric realities. Growing population and per capita consumption indefinitely is impossible. Malthus will be proven correct - his projections have only been delayed by cheap and abundant fossil fuels. See you in hell.
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Maugeri's prediction is that by 2030 more than 50 percent of the known oil will be recoverable. That statement is true and can be implemented using existing technologies at current oil prices.
Reply | Report Abuse | Link to thisTony Meggs at BP is talking along the same lines - Tackling the Third Trillion http://tiny.cc/qiN8D although he doesn't tie himself to a specific number.
To date all the improvements in oil recovery have been in changing the fluids or the orientation of the well bores.
Improving the injection process of any of the currently used fluids make a 50% ultimate recovery factor with an accelerated production profile achievable.
The "Thermophysics of Porous Media" by Dr. Tim Spanos documents the physics behind improving injection. Wavefront Technology Solutions have developed the tools to implement improved injection and are routinely increasing injection rates and oil recoveries.
There is an alternative theory on the origins of oil and natural gas called "abiogenic oil." Proposed by physicist Thomas Gold and others, it holds that hydrocarbons were present among the stellar debris from which the earth was formed more than 4.5 billion years ago. If Mr. Gold is correct, oil is not a fossil fuel at all. It exists naturally and in vast quantities deep beneath the earth's crust, from where it leaks upward. Gold cites much evidence for this theory in his book, "The Deep, Hot Biosphere." Mr. Gold would likely attribute ever increasing reserves in existing fields such as that in Kern County to the reservoir being refilled from below as well as to new technology.
Reply | Report Abuse | Link to thisShoddy, unscientific thinking fro the poster.
Reply | Report Abuse | Link to thisNot static, but certainly limited. It is a finite resource after all.
Of course, the amount recoverable does go up and down with price and technology, but the EROEI, and the total amount that can be recovered always goes down. As it must when considering a finite resource.
Many who criticise "peak oilers" appear to be unable to accept that oil is a finite resource. The fact that the "peak oilers" cannot predict when peak oil will happen (it may already have happened) does not make the idea wron in the first place.
Not only is the Kern Cheap Oil economically expensive, it is hydrologically expensive as well. For SAGD and thermal methods to advance there is assumed an infinite quantity of FRESHwater. And of course this is not the case, water being the so-called oil or gold of the 21st century. Oh and that tiny thing, necessary for life. Some interesting solutions to this issue come from Canada's oilsands in the form of new solvent based extraction technologies, developed by Suncor and Syncrude, Canada's regional super-producers.
Reply | Report Abuse | Link to thisThe main failure of this article is to address ANY larger impacts of expanded oil development on communities and sociological dynamics. Corporations must become increasingly aware of the lens under which they are carefully examined in the information age. Reporters/Writers such as yourself give citizens and investors a chance to see the side of the technology, the real truth of the issue, through the marketing and the lenses you mentioned. Excellent comment!
It doesn't really matter how much oil we can recover in the grand scheme of things. There is still the 'law of unintended consequences' to to be reckoned with. Of course those short sighted individuals that think we owe it to the world to burn every drop on Earth during the present generation don't 'believe" in that law. It is a real convenience and a comfort to point the finger at those who do.
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