When I’m wrong, I own up to it. It’s the right thing to do.
It seems that many of us have been relying on information provided by the Energy Information Administration (EIA) about how much oil is available off of US coasts other than the Gulf of Mexico (where drilling currently takes place) and Alaska.
I, along with many others, have been referring to the 200,000 barrel-a-day potential for just the Outer Continental Shelf (OCS) that EIA estimated in mid-2007. Even then, that excluded Florida, the Great Lakes and other lower-48 coasts, so the defenders of “The One“ I refer to as “Mr. BOOHOO-OUCH” (Barack O-bomba Overseas Hussein “Obambi” Obama - Objectively Unfit Coddler of Haters) were already playing with a stacked deck by ignoring them.
But back to the OCS — Frankly I should have known better, but I trusted the government (that’ll teach me).
First, you must remember that the coastal drilling, before it was banned, occurred during a time when the barrel price of oil was 10% or less of its current level, and at a time when technology wasn’t as efficient or as effective in getting the oil out. For what they could get for their product, all the oil companies could sensibly do was get to the easiest deposits, “knowing” full well (not based on “proof,” but on years of experience elsewhere), that there was plenty more to be had if prices ever got high enough to justify the extra costs involved in getting to it. Intuitively, it wouldn’t have made any sense for the oil companies to do any more than “skim the cream,” so to speak, considering what prices were at the time, while so many other areas of the world had plentiful oil flowing like water.
My gut told me that this was the case, but did I listen? Noooooo. Who was I, one lil’ ol’ blogger, to challenge the “experts” at the mighty EIA?
It turns out that I was wrong to rely on them, and I am sorry that I did so.
You see, it turns out that the EIA estimate is indeed low — we don’t know how low, but clearly very, very low, according to the Institute for Energy Research (IER):
200,000 barrels per day is roughly equal to the daily production rate one new offshore platform in the Gulf of Mexico. The Thunder Horse oil production facility, which will be on line this year, is designed to produce 250,000 barrels per day. The Atlantis oil platform currently producing in the Gulf of Mexico has a production capacity of 200,000 barrels per day.
It’s obvious that the OCS daily production potential is a multiple of the 200,000 EIA used. I’d guess, given 30-plus years of technological improvements and a 10 times or more higher barrel price in real terms, that an absolute minimum obtainable would be 600,000 barrels a day. (I have a call into IER, and will update the post if they are willing to give me a different most-pessimistic minimum.) I would be totally NOT surprised if the right number is over 1 million barrels a day.
It also turns out that the claim being bandied about that we couldn’t get oil from the coasts for at least seven years is incorrect — very, very incorrect.
Of course, it was wrong already, if you include Alaska. President Bush’s recent Executive Order will change that in somewhere between 17 and 53 months — or actually between 16 months and 24 days, and 52 months and 24 days (but who’s counting?). That timeline is based on the reference in this New York Times article to Alaskan coastal oil being obtainable by “2010 to 2012.”
But as to the OCS — Once again, I was wrong, and I am sorry. (This is getting very painful.) From the same link:
A report from Wall Street research house Sanford C. Bernstein says that California actually could start producing new oil within one year if the moratoria were lifted. The California oil is under shallow water and already has been explored.
In other words, there’s still a bit of cream left to skim — which makes sense, because the coastal bans went into effect before all the easy oil had been extracted.
All of this, of course, makes the claim by Obama last week — that “we could save all the oil that they’re talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups” — all the more absurd.
The central points from my previous posts (here and here) can now be restated.
The 120,000 barrels a day (see previous posts) that could conceivably be saved if everyone had their tires perfectly inflated and their cars perfectly tuned is:
- 20% or less — possibly a lot less — of what can be obtained on a daily basis from OCS coastal drilling (120 divided by 600). The old figure was 60%.
- 7.6% or less — possibly a lot less — of what can be obtained from OCS coastal drilling AND Alaska coastal drilling (600,000 plus 986,000 from the previous posts; 120 divided by 1,586 is 7.6%). The old figure was 12%.
- Far less than 1% of the now at least 29 million daily barrels that can be obtained from all coasts, shale oil drilling, and tar sands drilling/mining (1,586 million plus 27.3 million from shale and tar, rounded; 120,000 divided by 29 million is 0.41%. The old figure was 0.43%.).
I really should have done a better job at debunking the “The One’s” claim from the outset.
Please forgive me. I will do a better job next time.
Now in the spirit of forgiveness, I’m looking forward to the Barack Obama doing these things:
- Owning up the fact that his tired and out-of-tune claim is wrong. Heck, if he wants to, he can blame the EIA, and say “it was just a big, uhhhhhhhhhhh, misunderstanding.”
- Since that apology is too easy, Obama also must acknowledge that the country is not in a recession, contrary to what he said with only minor qualification (”Barack Obama said Saturday there is ‘little doubt we’ve moved into recession’â€) in July.
Whew. That’s one less “tired” claim from a man, and lots more oil available for mankind. :–>
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