The Myth of Saudi America

  gives us straight talk from geologists about our so-called era of oil abundance. Most things that sound too good to be true are wishful thinking. New claims that America is at the brink of a new era of oil and natural gas abundance is another of those fantasies.

The “abundance narrative” has been touted  in a report by Leonardo Maugeri, a former oil-industry chief and fellow at Harvard’s Belfer Center. Before long, the International Energy Agency was producing forecasts of the coming “Saudi America” while most of what passes for a media today – even the Economist – bought the story uncritically.

The Problem is…It Just Isn’t True

Pierrehumbert points out that Maugeri’s thesis is built on an egregious arithmetic blunder compounded by bad geological science and faulty reasoning.

Myth 1: “Shale Oil Is Abundant”

There is indeed a lot of oil in shale formations. The U.S. Bakken and Eagle Ford shales hold up to 700 billion barrels, with 2 trillion barrels in the Green River shale under Colorado, Wyoming, and Utah.

The problem is…only a tiny fraction of shale oil is actually recoverable:

  •  Just 1 to 2 percent of the Bakken shale in Montana and North Dakota, the Eagle Ford shale in Texas are estimated to be recoverable.
  •  The Bakken and Eagle Ford “shale oil” is actually “tight oil” – liquid trapped in the pores of the shale that can only be tapped by fracturing the rock to allow the oil to flow.
  • The hydrocarbon in the Green River shale is not really oil, but a thick substance that must be cooked at 500 degrees to convert into flowing oil.  The technology for extracting oil from such deposits is far more challenging than what is required to tap into tight oil, and has never been profitably implemented at any significant scale.
  • The highest estimates hold that production from Bakken and Eagle Ford would amount to just a two-year oil supply for the United States at 2011 consumption rates.

If the U.S. were to raise its production rates to those of Saudi Arabia, these resources would be shortly depleted, resulting in an oil crash.

Myth 2: “Technology Will Make It Viable”

The oil production technology that makes it possible to tap these resources is so expensive that the increasing efforts that it will take to continue to tap those resources will result in continually diminishing returns:

  • We are now drilling 25,000 wells per year just to bring production back to the levels of the year 2000, when we were drilling only 5,000 wells per year!
  • The days of the gushers are gone. For all the expense of the new wells ($10 million each in the Bakken), they give out rapidly, as shown below:

The amount of energy you get out of a well vs. the energy needed to produce the oil—has been getting steadily worse over time. Pierrehumbert sets the record straight:

Tight oil is headed for a Red Queen’s race, where you have to keep drilling and drilling and drilling just to keep your production in the same place. At several million dollars a pop, that adds up to a big annual investment, and eventually you run out of places to put new wells.

And the more you try to increase production by drilling wells faster, the faster you bring on an oil crash:


Myth 3: “U.S. Production Could Surpass the Saudis”

It Wouldn’t Last: To bring the current U.S. production of 6 million barrels per day up to the Saudi production standard of 9.5 million barrels per day would require new oil from tight-oil sources to more than offset declining production from existing wells. Even if this were possible, it wouldn’t last very long.

NIMBY: And at the same time that the benefits of drilling decline and deposits more rapidly deplete, collateral damage to the climate as increased carbon dioxide emissions are produced will escalate, making it increasingly unrealistic to sustain such a massive amount of drilling.

Myth 4: “Fracked Natural Gas Could Save Us”

Since the same general principles apply to natural gas, natural gas won’t last out the next few decades either. While it is still cheap and abundant, natural gas can buy us some time, but not much:

It will only do us good if we use this transitional period wisely. We won’t be much better off in the long run if cheap gas only succeeds in killing off the nascent renewables industry and the development of next-generation nuclear power.

Myth 5: “We Can’t Live Without Fossil Fuels”

Actually, the net effect of fossil fuels is that it is killing us off:

At 0.1159 metric tons of carbon per barrel of oil, the oil in Bakken and Eagle Ford amounts to a carbon pool of 81 gigatons, and the Green River shale adds up to 232 gigatons. Given that burning an additional 500 gigatons of fossil fuel carbon is sufficient to commit the Earth to a practically irreversible warming of 2 degrees Celsius, these are scary numbers.

However, if oil analysts such as those speaking at the American Geophysical Union are right, almost all of this oil will remain inaccessible. In that case, coal—which certainly contains enough carbon to bring us to the danger level and probably much beyond—remains the clear and present threat to the climate, and the fight to leave as much coal as possible in the ground remains the front line in the battle to protect the climate.

We Can’t Live On False Hopes

Instead of an unending age of oil abundance, the end of oil,  gas, and even coal is probably just a few decades away. So the urgency of beginning to plan for new energy sources is clear.

I’ll give Pierrehumbert the last word:

We are in for a hard landing if we don’t use our current prosperity to pave the way for a secure energy and climate future.