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Originally Posted by mstevmac
Very good video
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Yes - good editing and the basic notions he espouses seem so fair and realistic.
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Originally Posted by Buckeyeskickbuttocks
Seems sensible to me.
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Originally Posted by FCollinsBuckeye
Me too.
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Let me beg to differ on some particulars enunciated by Newt.
1 - Will opening up the SPR punish speculators?
Maybe, and then again considering the fungible nature of oil as a commodity maybe not so much as Newt believes. That is, taken alone a drop of $50 per barrel is itself a highly speculative prediction.
Moreover, without efforts to shed light on the dark markets and eliminate the Enron sponsored provisions that birthed the rise of big money funds in the commodities markets, a key underlying cause remains uncontrolled.
I'm giving Newt a C on this one. Opening up the SPR merely creates a latent and delayed demand to refill the same - which was itself a cause of some increases in price this year as it takes supply off the market.
2 - Drill Here, Drill Now -
2a - Rocky Mountain Oil Shale - there are copious articles describing the benefits to the US of opening up and exploring oil shale. Most are scam like promotional pieces for paper companies.
Some, instead examine the real challenges to getting oil out of oil shale.
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Recently, the U.S. Department of Energy published a new report on oil shale. It claimed that the nation could wring "200,000 barrels a day from oil shale by 2011, 2 million barrels a day by 2020, and ultimately 10 million barrels a day" from fields in Colorado, Utah and Wyoming. These predictions - both the production targets and their timing - are preposterous, as some industry experts admit.
But hyping oil shale is nothing new. As geologist Walter Youngquist once wrote, "Bankers won't invest a dime in 'organic marlstone,' the shale's proper name, but 'oil shale' is another matter."
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You could call the arguments heated, for the real soft underbelly of oil shale is that it takes a huge amount of energy to extract the kerogen from oil shale. Then, as if that were not sufficient obstacle, the material must be cracked and converted in yet another high energy intensive process to yield petroleum like grades of product.As pointed out on "
The Oil Drum," the price point at which Oil Shale becomes viable is often tantalizingly out of reach. Why? Because the huge cost of the energy to extract and then process the kerogenous compounds also rises.
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We continually are in a race between improving technology vs deteriorating ease of resource. So far, technology has been losing this battle - in the 1930s oil had net energy of 100:1, in the 1970s it was 30:1 and now it is estimated to be 10-20:1 (Cleveland, Boston U.) despite major improvements in oil extraction technology. Can the future improvements in technology that CERA professes, offset their own energy use? Shale oil (kerogen) was said to become economically feasible at $4 a barrel/oil in the late 1960s. Now its $30-40. When oil is $200/bbl it will be significantly higher still. The fact that higher energy inputs make everything else cost more suggest that a great many of the 3.74 trillion barrels of resources CERA claims, will not be extractable.
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I'm giving Newt a big fat "F" grade on Oil Shale.
If it were viable, and able to yield one drop tomorrow morning to alleviate our supply requirements Shell would already have been there, finished and done that. They haven't - it is still in research mode.
2B - Those pesky illegal offshore leases.
Fact - 79% of gas and oil reserves on Federal lands OR in Federal Waters are under lease. Seventy-nine percent. I agree with Newt - drill in these lands. Or to turn it around, why hasn't Conoco, et al taken advantage of the lease arrangements they have had for the last 7 years?
The trouble is they are simply sitting on the existing leases - not exploiting them.
I would call for a review of the lease and exploration activities. Time for the big boys to put up or to shut up.
You wanted those oil leases in 2000 or earlier and you have damn near 80% of those available. If it is such a good idea show us where your results are. If you have no results, and no willingness to explore and drill in existing leased areas then revoke the leases and reissue them to the willing and able.
I'd still give Newt a "D" on this, mainly because he is pointing at the wrong 1/5th of the problem on Federal leasing for drilling and ignoring 4/5th of the issue. Anyway you slice it that is an incorrect application of the 80:20 rule.
Besides which, if leases were granted today (likely for Exxon to sit on awhile) they wouldn't see oil for five to seven years - which doesn't do anything for current supply and demand.
3 - Alternative Energy Supplies -
Newt finally nails one quite well. Nuclear may not be everyone's cup of tea, but is going to be part of every Western Nation's solution to this problem. But, like he says, and we all agree, we need robust alternatives.
Wind, Solar etc.
Give Newt an "A" - on Alternative fuels.
06-30-2008, 09:28 PM
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