July 12, 2008

Oil Must Be Part of Energy Plan

By John McCamey Sweet

Everybody is unhappy about the price of gasoline, diesel and home heating oil because the price of a barrel of crude oil has escalated to record levels since last October. The situation might be mitigated if the nation could find more Prudhoe Bay-sized oil fields.

There is the potential to do this in the Arctic National Wildlife Refuge and the unexplored outer continental shelves. The groundwork has been laid, but the lack of permission to lease in the prospective areas has already caused a decrease of oil exploration activity in the United States. It is difficult to believe that Congress recently passed and President Bush signed a national energy policy without any mention of exploring for new reserves.

I was an oil exploration geologist for 35 years, a third of which were in Alaska with ARCO, which, with partner Humble Oil (ExxonMobil), discovered the Prudhoe Bay oil field. This is the largest oil field ever discovered on the North American continent.

I can vouch for the fact that oil is not found easily, nor quickly.

There was much blood, sweat and tears, plus two fatalities, for that discovery, which took 78 years to begin producing oil.

Ernest deKoven Leffingwell, one of the early explorers, paid his own way for seven years in the early part of the last century, exploring in both summer and winter and alone for much of the time. He once risked dying when he had to swim through icy water to retrieve a boat carrying his food and equipment. But not swimming would have meant certain death. As it was, he named the geological rock formation that is the main oil reservoir at Prudhoe Bay.

Most everyone is irrational about the price they pay for gasoline. They will buy a bottle of water and pay the equivalent of $12 a gallon! Milk is often more than $4 per gallon. Some Vermont maple syrup sells for $295 per gallon.

Converted to gallons, I think it would be hard to find many, if any, liquids that are less expensive than gasoline. But gasoline is not replaceable. Once burned, it is gone forever, for the resource is finite.

Prices of crude oil move with supply and demand. They are affected by wars and political unrest, new and large discoveries, old fields "playing out," good and poor economic periods, labor strikes, price controls, spot prices, commodity futures, OPEC expectations from increasing and decreasing production, and speculators.

Our national reserves are 21 billion barrels, give or take. The nation uses about 7.7 billion barrels per year. The United States increasingly has to import more oil. At the moment, imports exceed 60 percent. These figures extended to gallons per year and divided by the population mean that, on average, we each use 1,074 gallons per year.

At a simplistic decline rate, we will be importing all of our oil in another 21 years. It will no doubt be somewhat longer because old fields die slowly and increases in crude oil prices will stretch the final production for a longer time, but production of oil will be negligible.

Imagine the impact if all we can buy would be cut in half because producing countries might not have oil for sale, nor want to sell. There will certainly be oil in the world and lots for years to come, but other countries will have it. One should readily be able to guess that the lifestyles to which we have become accustomed will disappear - at least to some (great?) extent. The crude oil available might be sufficient for the essentials to make the county run, but not our SUVs and oil-heated homes.

We will never be self-sufficient with petroleum, but every bit we find will help us as we prepare for the inevitable oil doomsday we face in 20 to 25 years. We need to have a national energy policy that at least lets us attempt to discover more oil. We know it is there, but we don't know just not how much there is.

We need to come to our senses on both the outer continental shelf and ANWR. How much is "enough"? ANWR is 19 million acres, and the potential oil prospective area is very small. The caribou calving ground is the area in contention. Yet after drilling at Prudhoe Bay their numbers have increased from 7,000 to 32,000 and no one knows why.

Prudhoe Bay was discovered 40 years ago. Until ANWR and the outer continental shelf are drilled, any estimates are just that - estimates. Some believed Prudhoe was a long shot. These untested areas are, too. If they are dry, the environmentalists will have worried in vain. If productive, there isn't any doubt that we will be thankful for every drop we can find.

Originally published by John McCamey Sweet,.

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