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Page added on February 10, 2018

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From shortage to surplus: Where will energy innovation take us next?

Production

Forty-five years ago, I passed my driving test and giddily slipped my driver’s license into my wallet, ready to enjoy the freedom that a dollar’s worth of gas – then 28 cents a gallon at the local Hess station – could provide.

Several months later, those prices had just about doubled. My mother was waking me up in the early morning before school and handing me the keys to her station wagon so I could wait in long lines to buy a few gallons of gasoline – usually no more than $3 at a time – as officials rationed limited supplies.

The Arab oil embargo of 1973 reshaped the U.S. economy and changed the way Americans thought about energy, leading to more than three decades of obsession over how to use less oil, send less of our money to the Middle East and develop alternatives to petroleum.

What made me think about all this was last week’s Energy Department estimate that U.S. production had topped 10.2 million barrels a day in January, surpassing the output record set in 1970 and putting the United States on par with Saudi Arabia and just behind Russia. By the end of next year, the Energy Department estimates, U.S. production could reach 11 million barrels a day, making the country the world’s biggest oil producer.

The feat is incredible, not only in the context of long gas lines of more than 40 years ago, but also considering the circumstances of the last decade, when analysts were debating peak oil – the day that the world’s crude reserves would begin their slide to depletion – and predicting $200-a-barrel crude on the near horizon. In 2008, covering energy as oil prices climbed above $120, $130 and $140 a barrel, my phone was ringing off the hook with calls from companies and their promoters claiming to have found sources of energy that would reduce the need for oil.

One scheme that stands out involved dumping construction debris into a vat of molten metal to produce a kind of natural gas. Let’s just say the technology was never widely adopted.

Today, of course, the supply of oil seems almost limitless. Producers have honed techniques and technology to squeeze oil and gas from once-inaccessible shale rock, becoming ever more efficient at doing it. As my colleague Jordan Blum recently reported, oil companies have reached record production with about half the rigs that were in operation at the peak of the last boom in 2014.

The irony in all this is that the world no longer seems to want all this oil. As global temperatures rise and climate change becomes a greater threat, the nations of the world are pursuing polices – from tightening rules on carbon dioxide emissions to encouraging the spread of electric vehicles – to wean their economies off fossil fuels. Some energy companies, including British oil major BP, have conceded that they may end up leaving oil in the ground when all is said and done.

Undoubtedly, the pairing of hydraulic fracturing, or fracking, with horizontal drilling is one of the great innovations in American history, reshaping the U.S. economy and the geopolitical landscape as much as the 1973 Arab embargo. But now the industry faces another, perhaps bigger, challenge. As oil and gas companies unleash their legendary capacity for innovation, they may need to turn it to not only getting more crude out of more places, but also to finding ways to provide the world’s energy without adding to the Earth’s peril.

Chron



21 Comments on "From shortage to surplus: Where will energy innovation take us next?"

  1. Davy on Sat, 10th Feb 2018 7:39 am 

    This is just more flag waiving science denying nonsense from the journalist crews that lurk in the US mainstream media. There are multiple interrelated issues that are potential tipping points for our civilization, its economy and our global social fabric. This kind of hubris is emblematic of why we are never going to take the tough choices and always default to the back slapping the techno optimist constantly show. We are addicted to happy endings and affluence. Never do we hear of popular narratives of sacrifice and downsizing. Even the fake greens preach affluence with clean techno development. Shale is not an answer it is an extender.

  2. MrBill44 on Sat, 10th Feb 2018 9:07 am 

    “Shale is not an answer it is an extender.” Yep, as Kunstler said, “Party on, dudes”, Dilly, dilly!

  3. rockman on Sat, 10th Feb 2018 10:39 am 

    ““Shale is not an answer it is an extender.” Yep, just as every play over the last 100+ years has extended “oil age”. Not exactly a new revelation.

  4. rockman on Sat, 10th Feb 2018 10:49 am 

    And in 1918 the inflation adjusted price of gasoline the was almost $4/gal. A tad higher then during the so called “Arab embargo”. The price jump at that time was the “hoarding” of many tens of millions of gallons of motor fuel as drivers kept refueling as soon as their tanks dropped a little below full. Long after the “shortage” the govt came up with the stats that proved it. But for the most part the MSM ignored it because it didn’t generate headlines as exciting as Exxon having tankers full of fuel sailing in circles. LOL.

  5. MrBill44 on Sat, 10th Feb 2018 3:29 pm 

    Rockman: Yes, I do recall the constant topping off during the embargo, making long lines longer.

    Can you tell me if it is factual that modern fracking will not contaminate groundwater? I lived through a very bad experince, pre-fracking, in the 60’s, which resulted from what was termed at the time as “water-flooding” from “injection wells”, while growing up in Oklahoma.

  6. rockman on Sat, 10th Feb 2018 4:40 pm 

    Mr. Bill – Anytime we drill a hole, even f not frac’d, there’s a potential to contaminate the fresh water aquifer. But despite all the hysterical hype it’s very rare to happen due to the frac’ng process itself. I’ve gone over a number of fraudulent claims in the past.

    Yes: disposal wells (SWD wells) are one primary source. The casing corrodes and the crap is pumped into the fresh water zones. Sometimes unknown by the operator and sometimes suspected/known. With respect to the nasty frac fluids most of that has come from improper/illegal dumping. In Texas we call them “midnight haulers”: they find a quiet spot out of sight late at night and dump the crap from a tank truck into a creek or just on the ground.

    In my career I’ve help bust 2 midnight haulers. Most that get caught happen due to oil field hands: we often drive country roads after midnight and recognize a tank truck where it shouldn’t be. Why us? Most have families that live in the country. My 17 yo daughter has been drinking well water for 12 years. The last dumper I helped catch just sat in his truck waiting for the state police I called. He decided not to run when he say me lay my shotgun across the hood of my pickup. They may be assholes but they aren’t stupid. LOL.

    But if you dig thru the Internet you’ll find the vast majority of the ground water contamination comes from agricultural activity. The folks opposed to fossil fuel production and consumption (except for their consumption, of course) jumped on the “frac’ng is contaminating everything!!!” bandwagon for obvious reasons. They were helped by numerous landowners suing companies for contaminating their typically naturally contaminated well water. Sometimes by arsenic but usually by NG. Dozen after dozen such claims initially. But despite the fact that thousand of wells are still being frac’d today you now here very few such claims.

    Perhaps a number of them being charged with fraud has changed the dynamic. LOL

  7. MrBill44 on Sat, 10th Feb 2018 5:15 pm 

    Thank you Rockman. I see like everything else else, it’s complicated.

    Funny how a 12 ga model 870 gets people’s attention!

  8. Anonymouse1 on Sat, 10th Feb 2018 9:28 pm 

    Lol, narratvieman, your always coming up with new variations on your old bullshit, that the handful of morons around here that still believe your some kind of ‘authority’ swallow whole.

    I like this howler

    “But if you dig thru the Internet you’ll find the vast majority of the ground water contamination comes from agricultural activity.”

    Who finds that? You? That’s what you would like [whoever] to find, but they don’t. But that is a semi-clever technique you are using narrativeman, tell a blatant lie, while linking the [lie] with another truthful, but irrelevant statement. It IS true that industrial-ag pollutes groundwater. But that is not people find when they search the web for information about the uS oil cartel and they pollution it creates.

    If people want learn about Indust-ag’s record pollution, specifically, then that’s what they do. There is plenty of documentation on that topic as well. Lots of blame to go around, no need for industrial-ag to ‘hog’ it all, ahem. No one, besides lying sacks of shit like you, would think people start out researching FF polluting, only to discover the ‘real’ culprit, was big-ag all along.

    Deflect, and mis-direct. Always. That’s what they teach you at Shill University, right

    Nice try though.

    However, if you INSIST on conflating the two, here is a linkage for you. Industrial-Ag, is able to pollute on the scale they do, and it isn’t trivial, is solely because of…………wait for it bullshitman.

    Fossil-Fuels.

  9. rockman on Sun, 11th Feb 2018 11:40 am 

    Mr. Bill – You are one clairvoyant SOB. LOL. It was a Remington 870 pump. Even though it was designed over a half century ago it’s still the best/most reliable out there IMHO. Unfortunately had to switch from it to a sidearm when I had to switch from a PU truck to minivan: no good/convenient place to hide it in such a vehicle.

    Now my wife keeps it under her side of the bed. LOL.

  10. Cloggie on Sun, 11th Feb 2018 11:48 am 

    ““Shale is not an answer it is an extender.” Yep, just as every play over the last 100+ years has extended “oil age”. Not exactly a new revelation.

    Rockman, can I ask you for your opinion about underground coal gasification (UCG) and its potential in the US?

  11. MASTERMIND on Sun, 11th Feb 2018 11:52 am 

    Cloggie

    NASA Peer Reviewed Study: Industrial Civilization is Headed for Irreversible Collapse (Motesharrei, 2014)
    http://www.sciencedirect.com/science/article/pii/S0921800914000615

    The Royal Society: Peer Reviewed Study, Now for the First Time A Global Collapse Appears Likely (Ehrlich, 2013)
    https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3574335/

    Peer Reviewed Study: Limits to Growth was Right. Research Shows We’re Nearing Global Collapse (Turner, 2014)
    http://sustainable.unimelb.edu.au/sites/default/files/docs/MSSI-ResearchPaper-4_Turner_2014.pdf

  12. Cloggie on Sun, 11th Feb 2018 11:56 am 

    Yeah millimind, we are all going to die. So sad.

  13. MASTERMIND on Sun, 11th Feb 2018 12:09 pm 

    Clogg

    I am going to nail that Taylor Swift once society collapses! Ill turn her into my personal fuck toy!

  14. Cloggie on Sun, 11th Feb 2018 12:18 pm 

    I am going to nail that Taylor Swift once society collapses! Ill turn her into my personal fuck toy!

    I think you are going to be nailed by her body-guards. You see, she is a multi-millionaire, where you have to beg your mother for a dollar to go out and buy yourself an ice-cream.

    https://tinyurl.com/y83a99vh

    For the uninitiated, Taylor Swift is in America known as a “Nazi Queen”, for the simple reason that she refused to say for whom she voted and additionally refused to denounce The Donald.

    https://www.youtube.com/watch?v=IdneKLhsWOQ

  15. MASTERMIND on Sun, 11th Feb 2018 12:20 pm 

    When Someone Discovers Peak Oil

    https://www.youtube.com/watch?v=BPNwdOzXaCs&feature=youtu.be

  16. MASTERMIND on Sun, 11th Feb 2018 12:22 pm 

    Clogg I don’t care that she voted for trump! Ill be too busy ramming her in her rump!

  17. Cloggie on Sun, 11th Feb 2018 12:25 pm 

    I’ll just let you do the talking. Why should I try to attack you while you shoot yourself in the foot with every single post.

  18. MASTERMIND on Sun, 11th Feb 2018 12:30 pm 

    Cloggie

    NASA Peer Reviewed Study: Industrial Civilization is Headed for Irreversible Collapse (Motesharrei, 2014)
    http://www.sciencedirect.com/science/article/pii/S0921800914000615

    The Royal Society: Peer Reviewed Study, Now for the First Time A Global Collapse Appears Likely (Ehrlich, 2013)
    https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3574335/

    Peer Reviewed Study: Limits to Growth was Right. Research Shows We’re Nearing Global Collapse (Turner, 2014)
    http://sustainable.unimelb.edu.au/sites/default/files/docs/MSSI-ResearchPaper-4_Turner_2014.pdf

    And once society collapses you can run but you can’t hide!

  19. Anonymouse1 on Sun, 11th Feb 2018 12:34 pm 

    Taylor swift gossip now eh cloggen-zimmer? Totally on-topic and relevant, dumbass. You’re worse than a gossipy old jewish woman. Maybe you and sock-boy can trade Melania fashion tips, or talk about the donalds bad hair days. You know, the sort of things old jewish women love to natter about all day long.

    Idiot.

  20. Cloggie on Sun, 11th Feb 2018 12:51 pm 

    It was millimind who brought up the subject of raping Taylor Swift, you insufferable dummie.

  21. MASTERMIND on Sun, 11th Feb 2018 12:53 pm 

    Clogg

    And Taylor wont swallow my cum I will put it on spoon for her and make airplane noises!

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