Three weeks ago, the New York Times told us in a front-page story that there is more oil in Iraq than we ever dreamed of. Now comes another front-page story telling us that reserve estimates for the United States—and everywhere else—have been dramatically upwards revised, due to new advances in extraction technology. Exxon and Chevron are already using the technology to pump thousands of barrels a day out of fields that had pretty much been considered spent a few years ago from Texas to Indonesia. This is a clear blow aimed at the “peak oil” theorists. Oil prices have been falling modestly in recent days (almost down to $60/barrel at the moment, Bloomberg says), and the Times might want to help that trend along. But the development of the new technology was itself spurred by high prices (so much for “objective” science), which were in part driven by “peak oil” fears. Which deepens our suspicions that the “peak oil” hysteria was instrumented by the oil industry all along…. Here are the relevant excerpts from the story, “Oil Innovations Pump New Life Into Old Wells” by Jad Mouawad, New York Times, March 5 (links added):
Within the last decade, technology advances have made it possible to unlock more oil from old fields, and, at the same time, higher oil prices have made it economical for companies to go after reserves that are harder to reach. With plenty of oil still left in familiar locations, forecasts that the world’s reserves are drying out have given way to predictions that more oil can be found than ever before.
In a wide-ranging study published in 2000, the U.S. Geological Survey estimated that ultimately recoverable resources of conventional oil totaled about 3.3 trillion barrels, of which a third has already been produced. More recently, Cambridge Energy Research Associates, an energy consultant, estimated that the total base of recoverable oil was 4.8 trillion barrels. That higher estimate — which Cambridge Energy says is likely to grow — reflects how new technology can tap into more resources.
“It’s the fifth time to my count that we’ve gone through a period when it seemed the end of oil was near and people were talking about the exhaustion of resources,” said Daniel Yergin, the chairman of Cambridge Energy and author of a Pulitzer Prize-winning history of oil, who cited similar concerns in the 1880s, after both world wars and in the 1970s. “Back then we were going to fly off the oil mountain. Instead we had a boom and oil went to $10 instead of $100.”
There is still a minority view, held largely by a small band of retired petroleum geologists and some members of Congress, that oil production has peaked, but the theory has been fading. Equally contentious for the oil companies is the growing voice of environmentalists, who do not think that pumping and consuming an ever-increasing amount of fossil fuel is in any way desirable.
Ah yes, glad you brought that up, New York Times. When one factors in the question of global ecological collapse, this doesn’t apppear like such good news after all.
See our last post on the global struggle for control of oil.