Wednesday, August 6, 2008

Running The Numbers

I've been swimming in numbers for two weeks now, deciding what numbers would be best to present here to further shoot holes in the GOP political theater in regards to lifting offshore bans or drilling in ANWR. I wanted to present something new, hopefully I've done that here. The "drill faster, drill ANWR" crowd are really getting on my nerves with their ignorance. If they haven't bothered to educate themselves on this issue, then stop having an opinion on the subject. For the rest, they just filter out facts and logic until whats left is a paranoid-fantasy delusion which they vomit up online and in polls. Now, onto the numbers!


Where we import oil from, the top 5 countries:

1) Canada: 19%
2) Saudi Arabia: 10.5%
3) Mexico: 10.3%
4) It's a tie: Venezuela and Nigeria at 9% each
5) Iraq: 5%

These percentages represent a share of total imports, not a share of total US oil consumption. Imports from Saudi Arabia, Venezuela and Mexico have actually fallen this decade. The decline (since 2002): -4% from SA, -5% from Venezuela and -2% from Mexico, while imports from Canada have risen nearly 5% since that time. 55% of our oil imports come from non-OPEC nations.



Here are the top 5 oil producing states (Including state's offshore production). Numbers are annual production as of 2008:

1) Texas: 397 million barrels (539 thousand offshore)
2) Alaska: 352 million barrels (91.8 million offshore)
3) California: 231 million barrels (13.6 million offshore)
4) Louisiana: 85 million barrels (8 million offshore)
5) Oklahoma: 61 million barrels

New Mexico (in decline) and Wyoming (steady) are barely trailing Oklahoma.

By far the largest source of domestic US oil is the federal offshore areas, producing 490 million barrels.


Domestic oil production peaked in 1970, at 3.5 billion barrels of oil that year. It declined to 2.9 billion barrels by 1976. From 1977 - 1985, domestic production increased more or less every year to a post-peak peak of 3.2 billion barrels. Domestic production has been in decline every year since. In 2007, our production was 1.8 billion barrels.

Oklahoma peaked in 1924 at 278 million bpy (barrels per year).
Louisiana peaked in 1970 at 565 million bpy.
Texas production peaked in 1972 at 1.2 billion bpy
California production peaked in 1985 at 395 million bpy.
Alaska peaked in 1988 at 738 million bpy.

Now lets look at declines in production, in these very same big producers, from their peak years:

1) Louisiana: -85%
2) Texas: -75%
3) Oklahoma: -78%
4) Alaska: -52.5%
5) California: -42%

Federal offshore drilling has seen a 17% drop in oil production since 2002.

Here are the top 5 producers per year with increasing production, as of 2008. 2002 levels in parentheses:

1) North Dakota: 45 million barrels (31 million)
2) Kansas: 36 million barrels (33 million)
3) Montana: 35 million barrels (17 million)
4) Colorado: 23 million barrels (18 million)
5) Utah: 19.5 million barrels (13 million)

As you can see, the picture for US domestic oil production doesn't look all that great. Colorado and Utah are the big shale states. That oil isn't going to be cheap owing to the difficulty in extracting shale oil. So no cheap gas from that, even if they could ramp production up to match the levels of the big 5 producers.

The largest oil field ever discovered in North America is in Prudhoe bay, Alaska. When it came online in 1968, proven reserves were pegged at 25 billion barrels of oil. It peaked in 1987, producing 1.6 million barrels per day that year. Since 2000, production levels here have been dropping an average of 8% a year. By 2004, 10.7 billion barrels had been produced at Prudhoe. Meaning if the estimated reserves are correct, then 14.3 billion barrels remain. (link. Scroll down on there, they have the pages out of order.)

Lets close out this blog with what I think is a damning report (PDF) and one that should end the debate on whether oil companies need more land or offshore areas.

Of all the oil believed to exist on the outer continental shelf, 79% of it is located in areas already open to leasing. These leased areas equal 44 million acres. Only 10.5 million of them are being utilized. The excuse for this from wingnuts, is that there are restrictions blah blah blah. They seem to ignore the part about how this land is leased. The oil companies have it. They can drill if they want to. But they don't or cannot due to technical or financial reasons, sometimes both.

91 million acres are open to leasing in the arctic region of Alaska, that's including both onshore and offshore. Oil companies have leased only 11.8 million of these acres.

In the National Petroleum Reserve-Alaska, you have 22.6 million acres open to leasing. Oil companies have leased just 3 million of those acres. There is no production going on among those 3 million, and just 25 exploratory wells have been drilled since 2000.

Peak production from ANWR is estimated to take 20 years to reach, and would hit 780,000 barrels a day or 284 million barrels per year. That would provide less than 5% of our current needs per day. What will our oil demand be in 20 years? Maybe it will be less than now. Maybe more. These are all estimates. No guarantees.

If you'd like to check out where I get all these numbers, well here is a list of sources. Some are online. Some are books written by petroleum engineers, Like Kenneth S. Deffeyes. He talks about geophysicist M. King Hubbert, who successfully predicted that US oil production would peak in the early 70's, and the world would peak in the first decade of the 21st century. He made this prediction in 1956.

Hubbert's Peak. A book by Kenneth S. Deffeyes.
Gibson Consulting. Another great site, another oil geologist. Lots of links to sources as well.
EIA, Energy Information Administration. This particular page of the site has lots of interesting info, and you can delve into more specifics with the links on the left there
MMS, the Mineral Management Service
API, American petroleum Institute
The Prize. A book by Daniel Yergin. Excellent read about the history of the oil industry.

I don't imagine I will be writing another oil blog anytime soon, unless the GOP does something yet more outrageous. They are still plugging the Chinese/Cuba drilling myth on the floor of a darkened congress. They don't care. They'll keep up these stunts, nothing will change, and Americans will either be gullible and not see what the GOP is really up to or they'll smart enough not to buy into their ridiculous antics.

1 comment:

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