Sunday, May 20, 2007
O Canada
Everything you need to know about the dirty reality of mining tar sands. Keep this in mind as the conversation turns to the western shale deposits. It will get just as ugly if the underground aquifer is tainted by the mining operation, and the syncrude that is produced will be quite expensive. We burn 21M barrels a day, but the sand will not produce at that rate, and neither will the shale. Don't be fooled by promises of how we can achieve independence via the shale.
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Many companies are now starting to abandon tar sands projects as the associated costs move northward with the price of oil. It'a a case of "receding horizons"- the project never arrives at profitability because the ERoEI remains the same.
Even with the most efficient methods of extraction available, many experts have concluded that the tar sands of Alberta will never yield more than 3 million barrels a day at best, and then not till 2010. It will be expensive stuff.
The oil shales are worse, and the consensus in the industry is they are not worth working, and that they are just as daunting to work as they were in 1946, when some wag referred to shale oil as "the fuel of the future- and always will be."
It is to be wished that our political leaders and policy makers would stop deluding themselves and the gulllible public into thinking that there is an easy, cheap way out of this fix that will permit people to live as they have for the past 60 years.
The sooner we stop deluding ourselves, the sooner we can make the "other arrangements", as Kunstler calls them, that will permit us to remain civilized and retain most of the features of technological civilization. But the longer we cling to fantasies of rescue by shale oil or hydrogen or biomass,the longer we continue to waste and the worse the corner we are backing ourselves into.
Keep in mind that in the Seattle Peak Oil Town Hall (several months ago), Shell was present. One executive, talking after the main event, made it clear that $80/barrel oil, sustained for at least 2 years, would be the spur for serious shale development. The shale pilot is underway and Shell has publicly said a decision on the shale was not in the cards until 2010.
The past technology used to mine the shale was not viable and that is why it was abandoned. I wouldn't count the shale out altogether, although I don't foresee a production profile any higher than the tar sands. If Canada decides to pursue the nuclear option for the tar sands operation then the pressure on natural gas is relieved, although the pressure on water supplies is not.
This is something a lot of folks don't know about since the mainstream media hasn't made it 'sexy' enough for people to notice. All they hear is the 'trillion barrels of resource' and they figure all is well.
Kheris, I'll believe it when I see it.
That Shell Oil executive's speech perfectly illustrates the concept of "receding horizons", when it comes to the ERoEI of mining oil shales.
He said that the stuff would be worth mining when oil reached $80 a barrel?
Strange...... 10 years ago, it was said by industry insiders that $40 was the threshold for profitability.
And you know what? When it gets to $80, the profitability threshold will likely have receded to $120 a barrell, for the reason that as oil goes up, the costs of extraction goes up.
And it will keep receding as oil escalates in price, because working the stuff will become even more expensive proportionately, not less, as the machinery and fuel necessary becomes really difficult to obtain.
I mean, I have been hearing this stuff since I was a kid in the 60s. The energy crisis of the 70s spurred waves of speculation on alternatives, and shale was once again revisited, and people sat around and hacked out the same fantasies they had in 1946.
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