New “Golden Age of Oil” Collides With Planetary Realities

New “Golden Age of Oil” Collides With Planetary Realities

Story tools

Comments

A A AResize

Print

Share and Email

 

Photo: Shannon Bebe and Benjamin Franklin chained themselves to Keystone Pipeline construction equipment, Sept 25, in Winnsboro, Texas. Police assaulted, pepper sprayed and arrested them. (Planetsave photo courtesy Tar Sands Blockade)

Last winter, fossil-fuel enthusiasts began trumpeting the dawn of a new “Golden Age of oil” that would kick-start the American economy, generate millions of new jobs\ and free this country from its dependence on imported petroleum.

Ed Morse, head commodities analyst at Citibank, was typical. In the Wall Street Journal he crowed, “The United States has become the fastest-growing oil and gas producer in the world, and is likely to remain so for the rest of this decade and into the 2020s.”

Once this surge in U.S. energy production was linked to a predicted boom in energy from Canada’s tar sands reserves, the results seemed obvious and uncontestable. “North America,” Morse announced, “is becoming the new Middle East.”

Many other analysts have elaborated similarly on this rosy scenario, which now provides the foundation for Mitt Romney’s plan to achieve “energy independence” by 2020.

By employing impressive new technologies -- notably deepwater drilling and hydraulic fracturing (or hydro-fracking) -- energy companies were said to be on the verge of unlocking vast new stores of oil in Alaska, the Gulf of Mexico, and shale formations across the United States.

Extreme Oil

“A ‘Great Revival’ in U.S. oil production is taking shape -- a major break from the near 40-year trend of falling output,” James Burkhard of IHS Cambridge Energy Research Associates (CERA) told the Senate Committee on Energy and Natural Resources in January 2012.

Daniel Yergin, chairman of CERA, wrote in the Washington Post, “The new energy axis runs from Alberta, Canada, down through North Dakota and South Texas... to huge offshore oil deposits found near Brazil.”

It turns out, however, that to reach their ambitious targets, energy firms will have to overcome severe geological and environmental barriers -- and recent developments suggest that they are going to have a tough time doing so.

Consider this: While many analysts and pundits joined in the premature celebration of the new Golden Age, few emphasized that it would rest almost entirely on the exploitation of “unconventional” petroleum resources -- shale oil, oil shale, Arctic oil, deep offshore oil, and tar sands (bitumen). In contrast, conventional oil emerges from the ground in liquid form and can be extracted using familiar, standardized technology.

Fracking, Tar Sands and Arctic Drilling

The “unconventional” oil that is to liberate the United States and its neighbors from the unreliable producers of the Middle East involves substances too hard or viscous to be extracted using standard technology or embedded in forbidding locations that require highly specialized equipment for extraction. Think of it as “tough oil.”

Shale oil, for instance, is trapped in shale rock. It can only be liberated through the application of concentrated force in a process known as hydraulic fracturing that requires millions of gallons of chemically laced water per “frack,” plus the subsequent disposal of vast quantities of toxic wastewater once the fracking has been completed.

Oil shale, or kerogen, is a primitive form of petroleum that must be melted to be useful, a process that itself consumes vast amounts of energy.

Tar sands (or “oil sands,” as the industry prefers to call them), must be gouged from the earth using open-pit mining technology or pumped up after first being melted in place by underground steam jets, then treated with various chemicals. Only then can the material be transported to refineries via, for example, the highly controversial Keystone XL pipeline

Similarly, deepwater and Arctic drilling requires the deployment of specialized multimillion-dollar rigs along with enormously costly backup safety systems under the most dangerous of conditions.

All these processes have at least one thing in common: Each pushes the envelope of what is technically possible in extracting oil (or natural gas) from geologically and geographically forbidding environments. They are all, that is, versions of “extreme energy.” In each, accidents, mishaps and setbacks are guaranteed to be more frequent and their consequences more serious than in conventional drilling operations.

The apocalyptic poster-child for these processes already played out in 2010 with BP’s Deepwater Horizon disaster in the Gulf of Mexico, and this summer we saw intimations of how it will happen again.

Perhaps the most notable example was Shell Oil’s costly failure to commence test drilling in the Alaskan Arctic. After investing $4.5 billion and years of preparation, Shell was poised to drill five test wells this summer in the Beaufort and Chukchi Seas off Alaska’s northern and northwestern coasts.

Serious Setbacks

However, on Sept. 17, a series of accidents and mishaps forced the company to announce it would suspend operations until next summer -- the only time when those waters are largely free of pack ice and so it is safer to drill.

A more serious setback occurred later in September when a containment dome designed to cover any leak that developed at an undersea well malfunctioned during tests in Puget Sound in Washington State.

As the New York Times noted, “Shell’s inability to control its containment equipment in calm waters under predictable test conditions suggested that the company would not be able to effectively stop a sudden leak in treacherous Arctic waters, where powerful ice floes and gusty winds would complicate any spill response.”

Environmentalists and native groups have repeatedly brought suit to block Shell’s operations on the grounds that Arctic drilling will threaten the survival of marine life essential to native livelihoods and culture.

Shell, only after promising to take immensely costly protective measures and winning the support of the Obama administration, which feared appearing to block “job creation” or “energy independence” during the presidential campaign – finally obtained the necessary permits to proceed. But some lawsuits remain in play and, with this latest delay, Shell’s opponents will have added time and ammunition.

Officials from Shell insist that the company will overcome all these hurdles and be ready to drill next summer. But many observers view its experience as a deterrent to future drilling in the Arctic.

Extreme Water and the “New Normal”

Another unexpected impediment to the arrival of energy’s next Golden Age in North America emerged even more unexpectedly from this summer’s record-breaking drought, which still has 80 percent of U.S. agricultural land in its grip. The energy angle on all this was, however, a surprise.

Any increase in U.S. hydrocarbon output will require greater extraction of oil and gas from shale rock--via hydro-fracking. More fracking, in turn, means more water consumption. With the planet warming thanks to climate change, such  droughts are expected to intensify in many regions, which means rising agricultural demand for less water, including potentially in prime fracking locations, such as sites in North Dakota, West Texas and Pennsylvania.

The drought’s impact on hydro-fracking became strikingly evident when, in June and July, wells and streams started drying up in many drought-stricken areas and drillers suddenly found themselves competing with hard-pressed food-producers for whatever water was available.

Unfortunately, most climate scientists suggest that severe drought is likely to become the “new normal” in many parts of the United States, putting the fracking boom very much into question. Faulkner noted, “Without water, drilling shale gas and oil wells is not possible. A continuing drought could cause our domestic production to decline and derail our road to energy independence in a hurry.”

Then there are those Canadian tar sands. Turning them into “oil” also requires vast amounts of water, and climate-change-related shortages of that vital commodity are also likely in Alberta, Canada, their heartland. In addition, tar sands production releases far more greenhouse gas emissions than conventional oil production, which has sparked its own fiercely determined opposition in Canada, the United States, and Europe.

In the U.S., opposition to tar sands has until now largely focused on the construction of the Keystone XL pipeline, a $7 billion, 2,000-mile conduit that would carry diluted tar sands oil from Hardisty, Alberta, to refineries on the U.S. Gulf Coast, thousands of miles away. Parts of the Keystone system are already in place. If completed, the pipeline is designed to carry 1.1 million barrels a day of unrefined liquid across the United States.

Keystone XL opponents charge [http://bit.ly/t5SMrk] that the project will contribute to the acceleration of climate change. It also exposes crucial underground water supplies in the Midwest to severe risk of contamination by the highly corrosive tar-sands fluid (and pipeline leaks are commonplace).

Citing the closeness of its proposed route to the critical Ogallala Aquifer, President Obama denied permission for its construction last January. He is, however, expected to grant post-election approval to a new, less aquifer-threatening route; Mitt Romney has vowed to give it his approval on his first day in office, if he is elected.

Even if Keystone XL were in place, the Golden Age of Canada’s tar sands won’t be in sight -- not without yet more pipelines as the bitumen producers face mounting opposition to their extreme operations.
If the U.S. proves too tough a nut to crack, Alberta has a backup plan: construction of the Northern Gateway, a proposed pipeline through British Columbia for the export of tar sands oil to Asia. However, it, too, is running into trouble. Environmentalists and native communities in that province are implacably opposed and have threatened civil disobedience to prevent its construction (with major protests already set for October 22nd outside the Parliament Building in Victoria).

Sending tar sands oil across the Atlantic is likely to have its own set of problems. The European Union is considering adopting rules that would label it a dirtier form of energy, subjecting it to various penalties when imported into the European Union. All of this is, in turn, has forced Albertan authorities to consider tough new environmental regulations that would make it more difficult and costly to extract bitumen—and likely discourage investors.

Extreme Planet

In a sense, while the dreams of the boosters of these new forms of energy may thrill journalists and pundits, their reality could be expressed this way: extreme energy = extreme methods = extreme disasters = extreme opposition.

There are already many indications that the new Golden Age of North American oil is unlikely to materialize as publicized.
As for the rest of the Western Hemisphere, there is little room for optimism there either when it comes to the “promise” of extreme energy. Typically, for instance, a Brazilian court has ordered Chevron to cease production at its multibillion-dollar Frade field in the Campos basin of Brazil’s deep and dangerous Atlantic waters because of repeated oil leaks

While output from unconventional oil operations in the U.S. and Canada is likely to show some growth in the years ahead, there is no Golden Age on the horizon, only various kinds of potentially disastrous scenarios.

Those like Mitt Romney who claim that the United States can achieve energy “independence” by 2020 or any other near-term date are only fooling themselves, and perhaps some elements of the American public.

They may indeed employ such claims to gain support for the rollback of what environmental protections exist against the exploitation of extreme energy, but the United States will remain dependent on Middle Eastern and African oil for the foreseeable future.

Of course, were such a Golden Age to come about, we would be burning vast quantities of the dirtiest energy on the planet with truly disastrous consequences.

The truth is this: There is just one possible Golden Age for U.S. (or any other kind of) energy, and it would be based on a major push to produce breakthroughs in climate-friendly renewables, especially wind, solar, geothermal, wave and tidal power.

Otherwise the only “golden” sight around is likely to be the sun on an ever hotter, ever dirtier, ever more extreme planet.

Michael T. Klare is a professor of peace and world security studies at Hampshire College, in Amherst, Mass. He is the author, most recently, of The Race for What’s Left. A movie based on one of his earlier books, Blood and Oil, can be ordered at http://www.bloodandoilmovie.com. Follow Klare’s work on Facebook. A longer version of this article appears at TomDispatch.com. Copyright 2012 Michael T. Klare


 

Comments

 

Disclaimer: Comments do not necessarily reflect the views of New America Media. NAM reserves the right to edit or delete comments. Once published, comments are visible to search engines and will remain in their archives. If you do not want your identity connected to comments on this site, please refrain from commenting or use a handle or alias instead of your real name.