The USA: energy self sufficiency - political myth or reality? 1

[ARTURO8]

thread730-100534
Given probable economy and culture in the U.S., energy self sufficiency seems very unlikely.

Nevertheless, a multi-modal development is technically possible -- This would include not only the well publicized solar and wind but also [off the top of my head] further tech. in exploration and production of crude and liquids, clean burn for coal [double fluidized bed],
ocean currents, well engineered/constructed nuclear, high temp. superconductor transmission system.......

All

providing residential and commercial power. The latter to include a national very high speed 'rail' [maglev] which I believe Argonne National Lab determined would be profitable [or break-even] in studies performed during the 1990s. People would not give up their autos but discover maglev travel between major cities to be more comfortable and very much faster.

Articulation of concentrated market areas would further assist in offsetting costs [or improving net gain].

Consider as well that the above would represent a form of 're-industrialization' for this country.

Can't be afforded? The austerity = recovery arguments find little support, just as do wasteful expenditures.

 

[KENAT]

I thought the most recent big deal regarding potential energy self sufficiency of North America (not necessarily strictly USA as I recall) was the role fracking is playing and could continue to play in increasing recoverable reserves?

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[zdas04]

The three largest oil fields ever discovered in the U.S. are the Baaken Shale, the Eagle Ford Shale, and the Cline Shale. Since the Baaken first went on production our imports have gone from 70% of usage to 32% of usage and the Cline is just starting to com on line (you can't get a hotel room in Midland or Odessa, TX because of the development activity.

If the EPA, DOE (energy, not education) and Congress would pull their heads out of each other's asses we could easily reach energy independence in the next 5 years and be a net exporter shortly after that. The role of the campy "renewables" is precisely a highly visible side show that will suck more money and energy from the economy than they will ever give back. The role of coal will continue to decline as a percent of total because no one is building new coal plants. Gas-to-liquids has a role because of the huge shale gas plays that are languishing due to the low gas price. If Congress would let the market work (repeal the ban on exporting oil), the EPA would follow the law (they are purposely delaying a number of important projects), and if we could just de-politize this issue, we would have a balanced budget by 2020. What is actually happening? Bubpkiss. The current administration is anti-Oil&Gas, has always been, will always be. If these huge oil finds had been on federal surface we would still be importing 70% of our oil.

David Simpson, PE
MuleShoe Engineering

"Belief" is the acceptance of an hypotheses in the absence of data.
"Prejudice" is having an opinion not supported by the preponderance of the data.
"Knowledge" is only found through the accumulation and analysis of data.
The plural of anecdote is not "data"

 

[JohnRBaker]

Since it appears that the US may soon become a sustainable net exporter of oil perhaps we should also consider retaining this oil for domestic use only.

http://wizbangblog.com/2013/05/10/the-united-states-of-america-is-once-again-a-net-exporter-of-oil/

From reading the above I guess one could ask, if we're able to EXPORT more oil than we're importing, why in the hell are we still importing any oil whatsoever? Or at least, why haven't we decreased what we are importing even more than we have already? Is there some sort of price difference here where a barrel of domestically produced oil can be sold on the international market for MORE than it takes to purchase a barrel of foreign oil? Or are we simply seeing what could be described as 'momentum' in the market place which will eventually dampen out to where the amount of imports really does drop to near zero?

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[TGS4]

John - a lot of the issue in North American energy independence comes down to three things: location, location, location. There oil is not where the refineries are, and the refineries are generally located where the people are, in order to minimize transportation costs of finished products. So, that means that we need much more in the way of pipelines.

Right now, 500,000 bpd are moving from the Bakken via rail.

It's not just the international price vs domestic price (Brent vs WTI), but you also have to include the transportation costs. There may be cases where it is more cost-effective to import overseas oil on the east coast than transport it from Cushing, OK/Chicago/etc.

In addition to what zdas04 mentioned, there is huge potential in the oil sands, too. That could easily add another 1-2 million bpd of North American production in 5-10 years, IF the oil could get to market.

 

[KENAT]

Additionally I understand the different 'grades' of oil & what the refineries are set up to refine etc. can have an impact - combined with the US vehicles tending to favor gasoline/petrol rather than diesel.

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[ARTURO8]

KENAT - Production decline rates are high, requiring progressively increased drilling. The attached from Econbrowser covers some of this:

December 18, 2012
Future production from U.S. shale or tight oil

http://www.econbrowser.com/archives/2012/12/future_producti.html

Would also like to note that 'fracking' - in the form of using nitro to 'shoot' a well - began during the 19th century while 'acidizing' limestone formations also has some history [since the late 20's - mid 30's]. Recent/current anti-fracking may be more political than green.

 

[JohnRBaker]

Recent/current anti-fracking may be more political than green.

There's also the issue of scale/scope and the fact that there's less un- or lightly-populated areas today as there was back in the 19th or early 20th centuries. In other words, whatever amount of 'fracking' was going on back then, it was NOT having a noticeable impact (perceived or otherwise) on anyone.

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[zdas04]

Oh so many issues. First, every refinery is built to address a specific range of components in a crude stream (and every crude oil is different). So a refinery that was built to process WTI may have difficulty with some of the components in the Eagle Ford, but there may be a refinery in Aberdeen or Egypt or Trinidad that can take the Eagle Ford crude without modifying facilities. Before the 1970's this happened with great regularity. Every crude shipper would look at the components of the next shipload of crude and pick the refinery that was best able to process it and that had the best capacity availability. It was a global juggling act that worked good enough. When Jimmy Carter pushed through legislation to ban exports, these jugglers had to take the U.S. out of the mix to the detriment of the U.S. economy.

"Saving it for domestic use" is definite recipe for dropping the bottom out of the U.S. liquid fuel market. You might consider that a good thing, but at wellhead prices under $70/bbl (call it $2.08/gallon of motor fuel at the wellhead, which works out to around $3.80/gallon at the pump) will stop drilling activities just like $2/MSCF stopped gas drilling. With gas drilling largely stopped since 2008, the price has climbed back to $3.50/MSCF, but at $3.50 drilling for gas is still at historic lows. Drilling the expensive shale wells is costly and the industry needs about $6/MSCF or $70/bbl for drilling to make sense. If we keep the legislative ban on oil exports and the EPA refusal to sign off on permits for LNG plants for gas exports I see the wellhead prices drop to unsustainable levels and another mass exodus of people from the industry like happened in 1986 and 2008. Net result is long term higher prices after a brief period of lower prices.

Building a refinery is a multi-billion dollar undertaking and it has been decades since anyone was able to pull it off in the U.S. (mostly because of the export embargo, but also because the EPA rejects all such proposals). The refineries are getting really old and tired, most were build prior to WWI and the updates over the last century have been band-aides. Places like BP's Texas City Refinery are often in the news, generally because kit that was designed with an expected 50 year life is now in its eighth or ninth decade.

As to Hydraulic Fracture Stimulation there has never been a documented case of a frac impacting an aquifer. Never. The garbage in Josh Fox's version of Ralph Nader piece of fiction called "Unsafe at any Speed" which use fabricated data to kill the Chevy Corvair, Josh's Gasland fiction was a propaganda piece aimed at making Josh Fox famous. The water wells that he featured so prominently as being damaged by Cabot Oil were later tested by the EPA (not a noticeably pro-industry organization) and found to meet all the requirements for drinking water--certainly no "wepons grade Uranium" which is a material that requires extensive processing from any natural ore source and is not used in any Oil & Gas operation. Either Josh Fox or the sleazy homeowner invented the whole thing, and when the EPA asked the homeowner for a copy of the water analysis it was never produced. He made the whole thing up. As to water burning, there is a town in Louisiana that drilled a water well in the 1800's and hit gas. They built a swimming pool on the site and lit the gas, ever since then they have had a unique community resource. Water wells have included methane all over the world since the first water well was drilled.

Further, Hydraulic Fracture Stimulation has been done within the city of Houston, Dallas, Oklahoma City, Los Angeles (see Huntington Beach 1920's for some fun pictures, those wells were not frac'd, but within a couple of decades their offsets were), Denver, Salt Lake City (they actually had an offshore platform in the Great Salt Lake that was hydraulically fractured), and many more communities. It is safe. It is mature technology. The only thing different about the Shale stimulations is that due to the length of exposed pay, they have to do more stages than has been done in the past. Each stage is exactly what we've been doing for 70 years.

David Simpson, PE
MuleShoe Engineering

"Belief" is the acceptance of an hypotheses in the absence of data.
"Prejudice" is having an opinion not supported by the preponderance of the data.
"Knowledge" is only found through the accumulation and analysis of data.
The plural of anecdote is not "data"

 

[KENAT]

Thanks Zdas, your first few paragraphs are what I was getting at.

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[JohnRBaker]

A fair number of those Huntington Beach wells were still there (at least the ones on solid ground) in 1977 when I visited SoCal for the first time. Being from Michigan, seeing those wells strung along a sandy beach with only PCH between them and the surf was sort of shocking. Not that we didn't have oil wells in Michigan, just that they were always just one or two stuck out in the woods or near the edge of a farmers field. Granted, I'd seen big oil fields in Texas and Oklahoma but then they looked exactly like you'd expect them to, not adjacent to a surfing beach. But then there's that oil well on the campus of Beverly Hills high school:

Of course they've dressed it up a bit ;-)

John R. Baker, P.E.
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[zdas04]

There are wells offshore Long Beach that have sheet metal palm trees on the superstructure. Which is funny because if you turn the other way you see the eyesore that Signal Hill has always been (when I was about 12 I used to ride my bike in amongst the pump jacks on Signal Hill so that we could get a long downhill ride back to Lakewood, today they likely make local kids sign a JSA before riding up there).

I worked on a well within the city limits of Traverse City, MI that was drilled (and frac'ed) in the 1970's. There are nearly 500,000 gas wells and a few more oil wells than that. Call it a million wells in the U.S. Add 100,000 in Canada and about the same in Mexico. Every one of them was at least considered for fracture stimulation and something over 80% of them were subjected to that treatment. Call it a million frac jobs in North America. Not all achieved their stated objectives, but all were done with a high degree of safety for the public and public resources like water wells.

David Simpson, PE
MuleShoe Engineering

"Belief" is the acceptance of an hypotheses in the absence of data.
"Prejudice" is having an opinion not supported by the preponderance of the data.
"Knowledge" is only found through the accumulation and analysis of data.
The plural of anecdote is not "data"

 

[TGS4]

Another thing about "Saving it for domestic use" - in the early 1980's, Canada tried something like that, called the National Energy Program. It depressed the price of oil and gas (in Canada's west) for the benefit of the majority of users in Canada's East. It devastated the oil and gas industry. Almost 35 years on now, and the federal political party that brought that in is still a swear-word around Western Canada - that's how deep the hurt and damage was.

Right now, Western Canada would desperately love to export to someone other than the US (due to the rise in domestic production, and the significant discount for heavy oil), but can't get to a deep-water port.

Permitting LNG exports in the US would almost immediately raise the price from the levels David mention to the world price of near $12. Wouldn't a higher price for a resource bring in more government revenue?

 

[JohnRBaker]

Yea, I sailed a 'Hobie' cat (actually someone else was doing the 'sailing', I was just hanging on for dear life) out around one of those camouflaged 'oil islands' in Long Beach Harbor while on that 1977 trip, just to find out exactly what they were (they looked so beautiful at night, all lit up, that we just had to see what they really were):

John R. Baker, P.E.
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To an Engineer, the glass is twice as big as it needs to be.

 

[ARTURO8]

JRBaker,

Very nice and certainly distinct from any wells -sputter and rotary- that I've had the chance to meet. Rather than a 'Hobie' cat and bay, a '49 Power Wagon and mud was always fun but I'm sure there are big 'dog house' differences,,,undoubtedly 'payback' for my years on the mining side.

David Simpson,

Not quite the same but --

"I know not any thing more pleasant, or
more instructive, than to compare
experience with expectation, or to register
from time to time the difference between
idea and reality. It is by this kind of
observation that we grow daily less liable to
be disappointed."
--Samuel Johnson: Letter to Bennet
Langton

 

[cranky108]

I read recently there were two refineries being built in I think North Dekota, because of the amount of cruide, and the shortage of Desel fuel. Although small, they are new refineries.

Maglav is someones pipe dream, because it then must compete with the airlines. I expect it can compete on a limited scale, by offering thing the airlines don't. Example look at Amtrack's autotrain.
Now that TSA wants to screen Amtrack's passangers, any expecation of fewer hassels by taking a Maglav will be quickly be gone.
So what else can they offer to compete with airlines and Amtrack?

I don't know guys about the colorful work over rigs. Most of the newer wells I saw growing up, had no tall structures. This maybe different for off shore, but land based shoulden't have tall structures that remain after the well has played out. Now let me tell you my complaint about wind power.

No doubt solar power will come down in cost, but it will reach a saturation point, like wind, with balancing generation. The key to both of these technologys is either faster reserves (fast rampling fossel plants) or energy storage with a lower cost, and higher efficency.

Preventing the export of any fuels is a short sighted power play that many small minded people dictators or dictator wantabes have. The solution is to bring these problems to the voters to decide. No doubt we need a better governance.

 

[zdas04]

You are right, the first refinery permitted since 1976 has broken ground outside of Dickenson, ND. It will process 8,000 bbl/day of the 850,000 bbl/day produced in ND, cost estimate $300 million, and has been in the permitting process for a decade, construction is expected to be complete in 2015. I haven't been able to find a second new refinery that has broken ground (the articles I just read said that this new refinery will be ND's second, the other is the Mandan Refinery which takes in 60,000 bbl/day). There are 2 other refinery projects in the permitting pipeline, but the track record has been that 1 project in 25 clears all the hurdles to actually get a permit. The one that recently broke ground had the strong backing of both ND Senators and a Congressman who applied a lot of pressure on the EPA and DOE.

David Simpson, PE
MuleShoe Engineering

"Belief" is the acceptance of an hypotheses in the absence of data.
"Prejudice" is having an opinion not supported by the preponderance of the data.
"Knowledge" is only found through the accumulation and analysis of data.
The plural of anecdote is not "data"

 

[dwallace1971]

To paraphrase Milton Friedman, "As long as other countries are willing to trade such a useful commodity as oil for little bits of green paper, we should be glad to oblige them".

"On the human scale, the laws of Newtonian Physics are non-negotiable"

 

[rb1957]

@JRB ... hiding in plain sight ? ostentatious camouflage ?

Quando Omni Flunkus Moritati

 

[JohnRBaker]

No doubt solar power will come down in cost, but it will reach a saturation point, like wind, with balancing generation. The key to both of these technologys is either faster reserves (fast rampling fossel plants) or energy storage with a lower cost, and higher efficency.

http://finance.yahoo.com/news/10-billion-opportunity-batteries-100000802.html

John R. Baker, P.E.
Product 'Evangelist'
Product Engineering Software
Siemens PLM Software Inc.
Industry Sector
Cypress, CA
Siemens PLM:
UG/NX Museum:

To an Engineer, the glass is twice as big as it needs to be.