Monday, April 26, 2010

Gas & Oil problems - we are facing the same problems today as we did in 1973, and we had the same answers then

...So in 1973, we said we should get off dependency to foreign oil and drill in our own land. We said we needed more technology like battery cars, hydrogen and ethenol, nuclear, wind, solar, yet today we are still facing the same old problem with the same old solutions. Eventually, back in 1973, we recovered and the oil crises deminished.





My point and my question is this - congress has decided not to allow ourselves to get off dependency to foreign oil - we cannot even drill in Alaska or offshore. Should we not be doing something even if it might take 25 years to get it done, since - if we would have done something back in 1973, it would have already been done. Should we penalize the future generation just as we were penalized by those entrusted to carry out those steps 30 years ago.Gas %26amp; Oil problems - we are facing the same problems today as we did in 1973, and we had the same answers then
Look, I work for a major oil company, and I can assure you we are drilling both in Alaska and offshore. There are some specific places offshore and in Alaska where drilling is not currently allowed, but that is not a blanket prohibition.





Where an oil company drills is decided not just by regulations, but by economics, and the latter factor is by far the more important. We are producing oil from formations today that would have been impossible even ten years ago, both because of technological innovations and because of the increase in the price of oil. It's a lot easier, and therefore cheaper, to drill for oil in Texas than in the Gulf of Mexico, or through the permafrost in Alaska.





It may surprise you to hear this, but most of the foreign oil that comes into the US, on a country-by-country basis, comes from Canada. Until recently the oil sands of Canada have not been particularly economical to produce, because although the extraction is not particularly difficult, the refining is, at least more so than the light, sweet (meaning low in sulfur) crude that is the hallmark of US production. With the price of oil having gone up over the last several years, those oil sands have become much more economical to produce and refine, which is why the US is getting more and more oil from Canada and less and less from Saudi Arabia.





There has been some talk lately about the huge reserves of oil locked up in the shale formations under the Rocky Mountains. It is true that there are an estimated two to three TRILLION barrels of oil, more than in all of the Middle East, contained in these formations, but getting to it is problematical. For one thing, there is a congressional moratorium on shale extraction pending an evaluation of the environmental impact, which would be huge. You have to understand, we aren't talking about drilling here, but mining, because oil shale is rock. It contains a substance called kerogen which can be refined into a synthetic oil. The rock itself can be burned, like coal, but it is not an efficient fuel.





The other problem with oil shale is that it is much more difficult, and therefore expensive, to extract and refine than crude oil, or even oil sands, or even the thick ';tar oil'; that is found in such abundance in Venezuela. But of course with the price of oil as high as it is, and predicted to go higher, oil shales become more attractive to produce.





Ah, but there's the rub: the current rapid increase in the price of oil is almost certainly a speculatory bubble, and those bubbles always burst. You may remember the recent housing bubble, and the dot.com bubble of a few years back, both of which saw wildly inflated prices for houses and stocks for start-up IT businesses, respectively, which dropped back down to more reasonable levels after the market ';corrected'; itself. There was also the great Florida land bubble of the 1920s, the South Sea stock bubble of the early 18th Century, and yes, even the tulip bulb bubble of the early 17th Century (no, I'm not making this up), to name a few. The point is that the current price of oil is not in keeping with either supply or demand, and when -- when -- it goes back down to a more reasonable level, some of the current furor will abate. I'm not saying it's going to go back down to $50 a barrel, and it will probably be some time yet (these things typically last several years), but it will go down.





Having said all this, we still need to be investing heavily in alternative, more renewable sources of energy, because regardless of how much oil there is, or how difficult it is to produce, there is nevertheless a finite amount.Gas %26amp; Oil problems - we are facing the same problems today as we did in 1973, and we had the same answers then
Yes, although for different reasons and there is a lot less oil available now with a much larger market, i.e., China %26amp; India. The options for alternative energy sources,i.e., nulear, wind power etc., is always met with the ';NO'; brigade's objections. The only hope is for someone or some group of sciencists to invent a power source which can be produced at low cost and performs in much the same way as the hydrocarbon fuels we are used to. A heck of a task but I will bet it will be achieved and I also bet it will be you Yanks who do it. Would you hurry up please.
In 1973 during the first crisis, we started the development of petroleum alternatives and synthetic motor oil was invented (Mobil 1). Big Oil pressured Ronald Reagan to put the idea on the back burner so they could continue selling the resources they had plenty of, and he complied. How much better off America would now be if we had that 30 year jump on alternatives to petroleum?
We should of been dealing with this a long time ago, but in all reality, we are paying so much in gas prices because the oil refiners haven't been tooken care of, and the profits that the oil companies have already made are spend on paying their CEO's billions of dollars in salaries every year, and tell us that because their lines on the refiner broke, gas will have to go up to pay for expenses. The goverment needs to step in and make these oil companies pay more and stop passing us the consumers more money for the oil.


Secondly, we should start drilling in our own country, put the keep saying people won't allow it, which I don't see. The goverment needs to get off their asses and figuare out what to do so we don't have to keep paying massive amount of money for gas, because all its going to do is make more people out of jobs because they can't afford to drive to work. I totally agree, the goverment needs to start now, so in 25 years we might be further along in this issue.

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