Oil-peak fear-mongering suffers another blow
Thursday, July 13, 2006 at 1:38PM ARTICLE: "Saudi Arabia Tests Its Potential For Unlocking Heavy-Oil Reserves," by Bushan Bahree and Russell Gold, Wall Street Journal, 10 July 2006, p. A1.
So it's not just Canada unlocking the unconventional sources...
We forget that Saudi Arabia's known reserves have always been calculated in terms of the easily accessed light oil, or the stuff that just comes up when you pump some water down.
If [Saudi Arabia] succeeds in overcoming the technical hurdles, the effort could significantly increase Saudi Arabia's oil reserves over the next several years, potentially adding some slack to tight energy markets. It would also be a blow to so-called peak-oil theorists who have forecast that world oil production is on the brink of peakin.
Wow. That took long [the market response to high prices created by sustained rising demand coming out of the East], didn't it?
Hubbert's Curve works, on known fields. But it doesn't tell you much on Saudi Arabia's unexplored and unexploited heavy-oil fields, or Canada's oil sands or...
"Look for resources and ye shall find..."
My first globalization commandment.
The U.S. Geological Survey now estimates that in there is an much heavy oil in the Western Hemisphere as there is light oil today in the Eastern Hemisphere, or roughly one trillion barrels.
Reader Comments (1)
Most of that heavy oil is going to remain in the ground for a long, long time. It's all a matter of price ceilings and indirect competition. Oil will stay in the ground if coal is cleaner and cheaper. Coal and oil will stay in the ground if the space elevator brings plentiful, cheap beamed power that converts to hydrogen. Hydrogen will remain a pipe dream if we get keep having clean generation electrolysis costs at $6/gge until gasoline hits $6/gal.
Fortunately, hydrogen electrolysis is scheduled to drop to under $3/gge untaxed via local generation electrolysis by 2010 which means that gasoline can't rise much above $3/gal untaxed that year without provoking a shift to hydrogen, tanking demand. Price ceilings, also known as supply overhangs, are an effective means of capping prices via market forces.