Saturday, November 13, 2010

Alaska Won't Save Us

When this blog was still a baby blog, I mentioned a few of my beliefs.

"I don't think oil shale out West is going to save us and I don't think drilling in Alaska is going to save us. "

Last week I stumbled across this little tidbit in the Wall Street Journal..
U.S. Cuts Estimates of Untapped Alaska Reserves

The U.S. Geological Survey said Tuesday that Alaska holds less oil and natural gas onshore at the National Petroleum Reserve and in nearby state waters than previously thought.

The agency now estimates that the area, on and near land in Alaska's North Slope owned by the U.S. government, holds 896 million barrels of conventional, undiscovered oil, about 10% of the amount the agency predicted was there in 2002.

The USGS also updated its estimate for natural gas in the area to 53 trillion cubic feet, about 13% less than the agency predicted eight years ago.

"These new findings underscore the challenge of predicting whether oil or gas will be found in frontier areas," USGS Director Marcia McNutt said in a statement.

New geological data from three-dimensional seismic surveys and more than 30 exploration wells that have been drilled in the area show more gas in the area than oil, the USGS said. Many of the new wells show "an abrupt transition from oil to gas just 15 to 20 miles west" of the northeastern boundary of the petroleum reserve, the agency said.

The Interior Department's Bureau of Land Management has held five lease sales in the NPRA from 1999 through 2008. The agency currently administers more than 300 Federal oil and gas leases, according to the agency's Web site.

So, even if we could get every last drop of that oil out of Alaska, it would amount to 42 days worth of oil at our current consumption rate of 21 million barrels per day. That's it. Drill Baby Drill...?
Two and a half years after I made my predictions about Alaska, we have the BP spill illustrating how hard it is to get some of the oil that remains. We have multiple agencies reporting oil peaks in the next 5 years and even the US military forecasting massive shortfalls by 2015 and trying to make plans. That last link is the report that came out just a couple of months ago, and is well worth the time taken to skim the first few pages.
To ready America’s armed forces for tomorrow’s challenges, DOD should ensure that it can operate all of its systems on nonpetroleum fuels by 2040.

Costs of Petroleum Dependence
• Heavy dependence on large fuel supplies can
increase operational vulnerabilities and make
fuel supply infrastructure a more valuable
• Every dollar increase in the price of petroleum
costs DOD up to 130 million additional dollars.
• Rising global demand, for instance in China, is
increasing the strategic importance of petroleum
in ways that could be detrimental to U.S. interests.
• Countries such as Iran and Venezuela could
have the largest remaining reserves in a few
decades if current production rates hold – and
will gain leverage as a result.
• High levels of petroleum consumption are
contributing to the changing climate, which
can bring destabilizing effects and trigger new
security challenges.

Now, they are hedging their bets on the crunch happening 30+ years from now. Some reports show that they'll have that much time, but other reports show a crunch happening much sooner than that. Even if they are working off a 30 year time line, having our military starting the move away from petroleum will be a great market motivator for the developing technologies that will help all of us transition. There are few other organizations with the sheer amount of capitol that the DoD wields.

What does all this mean? In my opinion, it means if your future plans don't include plans to deal with peak oil, they should. If not future plans for yourself, future plans for your kids and grandkids. Does your current diet have you heavily dependent on oil to transport it? What about your leisure activities and hobbies? Does your job depend on cheap oil? Is your house comfortable without a lot of AC/Heat? These types of things don't need to be oil free tomorrow, but you should start considering strategies.

No comments: