US Now Produces More Oil and Gas Than Russia and Saudi Arabia 416
Hugh Pickens DOT Com writes "Claudia Assis writes that the US will end 2013 as the world's largest producer of petroleum and natural gas, surpassing Russia and Saudi Arabia with the Energy Information Administration estimating that combined US petroleum and gas production this year will hit 50 quadrillion British thermal units, or 25 million barrels of oil equivalent a day, outproducing Russia by 5 quadrillion Btu. Most of the new oil was coming from the western states. Oil production in Texas has more than doubled since 2010. In North Dakota, it has tripled, and Oklahoma, New Mexico, Wyoming, Colorado and Utah have also shown steep rises in oil production over the same three years, according to EIA data. Tapping shale rock for oil and gas has fueled the US boom, while Russia has struggled to keep up its output. 'This is a remarkable turn of events,' says Adam Sieminski, head of the US Energy Information Administration. 'This is a new era of thinking about market conditions, and opportunities created by these conditions, that you wouldn't in a million years have dreamed about.' But even optimists in the US concede that the shale boom's longevity could hinge on commodity prices, government regulations and public support, the last of which could be problematic. A poll last month by the Pew Research Center for the People and the Press found that opposition to increased use of fracking rose to 49% from 38% in the previous six months. 'It is not a supply question anymore,' says Ken Hersh. 'It is about demand and the cost of production. Those are the two drivers."'"
So why didn't prices go down then? (Score:5, Informative)
Why are we still paying $3.50/gal for gasoline?
Hydraulic fracturing, or “fracking”, is the process of drilling and injecting fluid into the ground at a high pressure in order to fracture shale rocks to release natural gas inside. Each gas well requires an average of 400 tanker trucks to carry water and supplies to and from the site.
It takes 1-8 million gallons of water to complete each fracturing job.
The water brought in is mixed with sand and chemicals to create fracking fluid. Approximately 40,000 gallons of chemicals are used per fracturing.
Up to 600 chemicals are used in fracking fluid, including known carcinogens and toxins such as
The fracking fluid is then pressure injected into the ground through a drilled pipeline.
500,000 Active gas wells in the US X 8 million Gallons of water per fracking X 18 Times a well can be fracked
72 trillion gallons of water
and
360 billion gallons of chemicals
needed to run our current gas wells.
The mixture reaches the end of the well where the high pressure causes the nearby shale rock to crack, creating fissures where natural gas flows into the well.
During this process, methane gas and toxic chemicals leach out from the system and contaminate nearby groundwater.
Methane concentrations are 17x higher in drinking-water wells near fracturing sites than in normal wells.
Contaminated well water is used for drinking water for nearby cities and towns. There have been over 1,000 documented cases of water contamination next to areas of gas drilling as well as cases of sensory, respiratory, and neurological damage due to ingested contaminated water. Only 30-50% of the fractring fluid is recovered, the rest of the toxic fluid is left in the ground and is not biodegradable. The waste fluid is left in open air pits to evaporate, releasing harmful VOC’s (volatile organic compounds) into the atmosphere, creating contaminated air, acid rain, and ground level ozone. In the end, hydraulic fracking produces approximately 300,000 barrels of natural gas a day, but at the price of numerous environmental, safety, and health hazards.
Re:Importation (Score:5, Informative)
2 Factors.
America uses more oil then it produces but produces more gas then it uses.
America has a lot of refiners. IIRC Nigeria exports oil to the US where it is refined into gasoline and shipped back. Also remember that plastic is comes from oil and gas - and we produce and consume a lot of plastic.
Re:Geopolitics (Score:5, Informative)
We'd still support the Saudis because Europe and China still use Mideast oil. We might not have been independent of Middle East oil, but we've always used much less of it than other places do. The problem here isn't feeding US SUVs as much as it is keeping the world stable and out of an energy crisis. If the Saudis suddenly stopped selling oil to Europe, the US would be mostly okay, but it would trash our allies and seriously destabilize the world picture.
Re:So why didn't prices go down then? (Score:5, Informative)
Why are we still paying $3.50/gal for gasoline?
Because of the deniers who will refuse more stringent pollution control and gasoline taxes. But sooner or later, it will be up to a more normal level.
Domestic refineries (Score:2, Informative)
Isn't much of the foreign oil refined in the US [businessweek.com] anyway? Strategically that still gives some control over the commodity.
Anyway the article linked to in the summary is short on details. It looks like the oil+natural gas mentioned in the summary really consists mostly of natural gas.
Bubble? (Score:5, Informative)
I have read several articles and reports by economists and geologists claiming this fracking boom is a bubble. The estimate of 100 years worth of gas is overstated. It seems 25 years worth of gas is more likely, less if gas exports are allowed. Then the bubble bursts. The shale oil bubble is worse, 80% of shale oil comes from two rapidly declining deposits, so unless replacements deposits are found that bubble bursts in ten years or so,. Also, we haven't even started talking about limiting factors like environmental issues and the increasing cost of maintaining production levels as the best deposits are used up. As usual everybody is so busy dancing to the buzz they don't stop to think.
Re:Environmentalists... (Score:3, Informative)
Ok, I hope the NIH is good enough for you, because it's what determined my own concern.
here [nih.gov]
Wow, really? oh.... wait.... (Score:5, Informative)
Oil production in Texas has more than doubled since 2010
Huh, that's interesting because I thought that it was more or less established that the lower 48 states hit peak oil a while ago. The price went up, but production didn't, because they couldn't, because it wasn't there.
Oh, wait, yeah, here we go:
It doubled from almost nothing. (linked like it's hot) [wikipedia.org] And here's the larger picture. [wikipedia.org]
Now, the main thrust of the article could be right on the money because it lumps natural gas in with oil and we've got a new way of squeezing gas out of the ground. WOO! Let's here it for technological innovation making the world a better place! But pointing out how Texas has doubled production from 300 to 600 million of barrels per year when it used to produce over 1200, and other than the last few years has been in decline since the 70's.... it's a little disingenuous.
But it's interesting that Texas has indeed ramped up oil production. There's probably a pretty serious story about why they're doing it NOW as opposed to during the massive scare that preceded the econopocalypse cica 2006.
Re:Importation (Score:5, Informative)
You're more Illinois Nazi than Grammar Nazi. A proper Grammar Nazi would not have used a comma to separate independent clauses without a conjunction. Perosnally, I would have preferred a semi-colon. All the cool Nazis are using them these days.
Yet US oil producers pay no taxes, get subsidized (Score:5, Informative)
America may now be the world's biggest oil producer, but in contrast to other oil producing countries around the world, where multinational oil companies must hand over most of their profits (90% in Saudi Arabia), when they pump it out of the ground in the United States they pay zero taxes and are even subsidized with hundreds of millions of dollars a year.
Why? Because of political bribery, now legal thanks to Citizens United v. Federal Election Commission, which has created a corrupt Congress that affects both Democrats and Republicans alike.
Luckily there is still hope: it's called Wolf-PAC [wolf-pac.com]. This organization was launched in October 2011 for the purpose of passing a 28th Constitutional Amendment to end corporate personhood and publicly finance all elections. Since Congress won't pass an Amendment like this on its own, the idea is to have the State Legislators propose it instead by way of an Article V Convention. At least 34 States need to cooperate for this to work, so it's not an easy thing to do, but already many have reacted with enthusiasm, notably Texas. If successful, Congress should be fixed within one or two election cycles.
Re:Importation (Score:4, Informative)
While it is true we have not built any new refiners since the 1970s we are still a net exporter or gasoline and other petroleum products.
From your own source:
http://www.eia.gov/dnav/pet/pet_move_neti_dc_NUS-Z00_mbblpd_m.htm [eia.gov]
(I think America needs to build more refineries but does not thanks to NIMBYs)
Re:Bubble? (Score:5, Informative)
I have read several articles and reports by economists and geologists claiming this fracking boom is a bubble. The estimate of 100 years worth of gas is overstated. It seems 25 years worth of gas is more likely, less if gas exports are allowed.
I don't really have an opinion on the issue as a whole, but it's worth pointing out that similar reports have been telling us for decades that the end was nigh, and yet we continue finding new deposits and/or new ways to exploit known deposits. Obviously that can't continue forever, and it seems pretty clear that there are other issues that have to be considered (e.g. climate change), but I'm pretty skeptical of anyone projecting near-term resource exhaustion.
It's always possible, of course, that this time the wolf really is here, but...
Besides that, I think anyone predicting a sudden collapse of supply is silly. That's not how the world works; you don't see all of the fields simultaneously ceasing production, instead many fields begin to decline at differing rates. The result -- when we near exhaustion -- will be that available supply gradually tapers off, which will cause prices to gradually rise in order to limit demand to available supply. Rising prices will eventually move us off of fossil fuels, if we haven't already done it for other reasons.
I was in the.skeptic camp in 2007/8 well before the mortgage crisis and I used to get got same kind of speeches you just gave. Nobody believed you could have a mortgage crisis on that scale, they didn't even think that there was anything wrong with putting people on bonuses handing out loans. You can have a fracking bubble without resource exhaustion just like you can have a real estate bubble without that being the end of real estate. Secondly, when it comes to shale oil and gas, resource exhaustion is a pretty rapid process. Regular oil wells last for multiple decades, shale deposits are exhausted in years and the drop in yields is very rapid so you frack your way through deposits very rapidly. You should read that last article linked to in the summary, it is a good place to start and it also mentions the 10 year shelf life of the shale oil boom (I got that figure elsewhere). I suppose we'll see what happens next, I just hope it isn't a rerun of the mortgage crisis.
Re:Geopolitics (Score:4, Informative)
Alliances arise out of necessity and mutual benefit, not from mutual like or some playground friendship mentality. As much as the governments of US allies may publicly denounce US actions for the sake of their own domestic image, they still collude with the US on geopolitics. For example, Merkel and parliamentarians may denounce PRISM and make public overtures of "overview" and "investigation", if only to keep their parties in favorable light with the public, but the BND's data-sharing will nonetheless continue because they need US data as much as the US needs theirs, if not more so.
So much for energy independence (Score:4, Informative)
The US consumes 7 billion barrels of oil per year (around 19 million barrels per day). Way more than the 12~13 million barrels produced in the US (according to the graph).
Reference: http://www.eia.gov/tools/faqs/faq.cfm?id=33&t=6
Re:Cars running natural gas (Score:4, Informative)
I don't know anyone who owns a Veyron either, do you doubt they exist?
Nobody doubts passenger cars running CNG exist but they are about as rare as a Veyron - albeit for a very different reason. The simple reason there are hardly any CNG power passenger cars is that there is very limited refuelling infrastructure in place. Sure I can buy one in theory but since I can't refuel it most places it would be rather stupid to do so. Even electric vehicles have a more readily available infrastructure than CNG powered cars though they suffer from a similar problem. Most CNG powered cars are basically proof of concept vehicles rather than anything else
So the original post was correct if you aren't overly pedantic about things in that for all practical purposes there are no passenger cars that run on CNG. Strictly speaking there are some out there but hardly anyone actually has one because the circumstances required to make one practical apply to virtually no one.