November 08, 2007
Royal Dutch Shell In Lead With Oil Shale Technology

Royal Dutch Shell decided to lift some (though not all) of the secrecy surrounding their research into extracting oil from oil shale in Colorado and Wyoming. Jon Birger of Fortune magazine was given access to Shell oil shale researchers and has written a pretty good piece on the prospects for oil shale energy production.

Spanning some 17,000 square miles across parts of Colorado, Utah and Wyoming, this underground lakebed holds at least 800 billion barrels of recoverable oil. That's triple the reserves of Saudi Arabia.

Since Saudi Arabia's reserves are well below their claimed reserves the multiple between oil shale reserves and Saudi reserves is probably more than triple. If Shell can extract that oil it will change the relative economic power of nations.

The reason you probably haven't heard about the Green River Formation is that most of the methods tried for turning oil shale into oil have been deeply flawed - economically, environmentally or usually both. Because there have been so many false starts, oil shale tends to get lumped with cold fusion, zero-point energy, and other "miracle" fuels perpetually just over the horizon.

"A lot of other companies have bent their spears trying to do what we're now doing," Vinegar says of his 28-year quest to turn oil shale into a commercial energy source. "We're talking about the Holy Grail."

Unlike the Grail, though, Shell is convinced that oil shale is no myth and that after years of secret research, it is close to achieving this oil-based alchemy. Shell is not alone in this assessment. "Harold has broken the code," says oil shale expert Anton Dammer, director of the U.S. Department of Energy's Office of Naval Petroleum and Oil Shale Reserves.

Shell physicist Harold Vinegar thinks the oil can be extracted for a cost of $30 per barrel but not before 2015. So oil shale isn't going to do anything to relieve our near term woes with rising oil prices.

But while the amount of oil available for eventual extraction from the shale is enormous the peak production rate will not entirely offset the coming decline in production of conventional oil.

Shell declines to get too specific about how much oil it thinks it can pump at peak production levels, but one DOE study contends that the region can sustain two million barrels a day by 2020 and three million by 2040. Other government estimates have posited an upper range of five million. At that level, Western oil shale would rival the largest oilfields in the world.

Of course, considering the U.S. uses almost 21 million barrels a day and imports about ten million (and rising), even the most optimistic projections do not get the country to the nirvana of "energy independence.

Shell's work in this area has stretched over decades. Their research puts them well ahead of other oil companies and have lots of patents which will likely let them start producing before their competitors.

Oil shale and oil sands are good because they'll make the world oil production decline less sharp. If the coming decline in oil production is too sharp the economic downturns in many societies could lead to breakdown of order and mass starvation as modern agriculture loses the ability to run on oil. The rate of decline which causes a collapse varies depending on the circumstances of each individual society. France with a large number of nuclear reactors is less vulnerable than Britain with a much smaller number. Countries with highly skilled populaces and lots of capital will be better able to rush into nuclear reactor construction, build wind turbines, rework houses to increase insulation, and engage in many other adaptive adjustments to the oil production decline.

Follow the link to the article to read about Shell's method of in situ oil shale extraction. If their planned experiments produce successful results America especially will be able to better adjust to the post peak oil world.

Share |      Randall Parker, 2007 November 08 09:24 PM  Energy Fossil Fuels

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