The new generation of oil rigs: enormous, energy-conscious, and equipped with Internet cafes.
Read more. [Image: Maersk Drilling]
The dramatic changes to the nation’s energy outlook are as surprising as they are clear. Seven years ago, oil production was in steep decline and natural gas nearly as hard to find. Today, the United States produces over 7.7 million barrels of oil a day, up over 50% since 2006 and the most in nearly 25 years. The nation could pump more than eleven million barrels a day by 2020. The U.S. is on track to pass Russia as the world’s largest energy producer and should have enough gas to last generations.
The wildcatters responsible for the transformation are as unexpected as the energy surge they produced. These men, operating on the fringes of the oil industry and often without backgrounds in geology or engineering, met success drilling and hydraulic fracturing extremely dense shale, a process that’s become known as fracking.
George Mitchell is the father of the energy revolution. His impact eventually could approach that of Henry Ford. Mitchell and his team weren’t out to change history, though. They just wanted to keep their company alive.
Read more. [Image: Reuters]
Saudi Arabia dealt a high-profile snub to the international community and the United States on Friday when it turned down a rotating seat on the United Nations Security Council. The unprecedented move was a culmination of months of public derision directed toward the U.S. for its halfhearted approach to intervention in Syria, its tacit support of the Muslim Brotherhood in Egypt and, most recently, its overtures to Iran. High-level U.S. talks with the Islamic Republic, Saudi Arabia’s bitter regional rival, were the last straw. Last Tuesday, the head of Saudi intelligence services told European diplomats to anticipate a “major shift” away from the United States over disagreements on Syria and Iran policy. Recent Saudi rhetoric has been so severe that in it Israeli Justice Minister Tzipi Livni heard echoes of her own country’s politics: “When you hear the Saudis talk about what needs to be done to prevent [a nuclear] Iran, it sounds familiar,” Livni said.
Although Saudi Arabia’s vehement anti-Iranian sentiment is often framed in terms of regional or religious rivalry, talk of loosening the punishing international sanctions regime on Iran also prompts anxiety in Saudi Arabia for economic reasons.
Read more. [Image: Ali Jarekji/Reuters]
Last Friday the Associated Press reported that approximately 300 oil pipeline spills have occurred in North Dakota since January 2012 – and that none of those spills were reported to North Dakota residents and landowners. This sort of news raises the question of who, if anyone, is paying attention to the integrity and efficacy of America’s pipelines.
The most recent publicly known spill in North Dakota was discovered by a wheat farmer in Tioga, near the northwestern corner of the state, on September 29. Over 865,000 gallons of oil, enough to ooze over seven acres of land, had leaked from a Tesoro Logistics pipeline. Tesoro didn’t know about the leak until the farmer, Steven Jensen, called another oil company with a pipeline in the Tioga area to report that oil was gurgling up from the ground on his property. After being relayed to Tesoro the same day, notice of the problem got to the North Dakota Department of Health, whose officials did not alert the public of the accident until several days later, according to the New York Times. According to the AP, “officials kept it quiet for 11 days - and only said something after the AP asked about it.”
Read more. [Image: Kevin Cederstrom/Associated Press]
If you want to understand how to create jobs — not just a few at a time, but hundreds of thousands at once — look to Texas and North Dakota.
Together, these two states account for a little more than 8 percent of the country’s population — about one in 12 people. But they’re also responsible for 20 percent of net new jobs since the end of the recession. And, crucially, they account for “more than 100 percent of the increase in U.S. [oil] production since 2009,” James Hamilton writes.
The Great Plains have been relatively great throughout the recovery for many reasons — cheaper land, cheap wages, service sectors insulated from the housing-finance crisis that leveled parts of California, Florida, Arizona, and Nevada — but energy has helped a lot. It’s “not entirely a coincidence,” Hamilton wrote, that “the middle of the United States [has] been most successful in terms of connecting workers with jobs.”
Before the fracked gas boom of the last 10 years, before the rise of mega oil companies, before the entire 20th century, actually, humans figured out how to increase the flow of fossil fuels from a well. It was simple: take an iron container about the size of a large thermos, stick some black powder or other explosives into it, stick a blasting cap on it, send it down the well, and then send a weight down to detonate it. BOOM. They called this, “Shooting the well!” And I believe the “!” is required, as in Yahoo!
The president likes to refer to our so-called “proven” reserves — oil that can be recovered with relative certainty given today’s economic, technological, and regulatory constraints. It’s oil that companies have already discovered, and that they can drill up profitably without breaking the law. Oil in areas where drilling is banned, such as the Arctic National Wildlife Refuge, isn’t included. According to the U.S. Energy Information Administration’s most recent estimates, the United States has roughly 20 billion barrels of these reserves, around 2 percent of the global total. But proven reserves are only a small part of the petroleum picture, and don’t give us a very accurate picture of future supply.
That’s where the Republican criticism comes in. This week, the U.S. Geological Survey released a study of the world’s “undiscovered, technically recoverable” oil resources. It sounds complicated, but is relatively simple. It’s oil we haven’t actually found, but believe is there based on geological studies, and think we can get at with current drilling technology, regardless of the legal or economic issues. The new survey did not include the United States, but Republicans have combined its results with previous estimates showing we have 198 billion barrels of this kind of oil. […]
Now, here’s where the USGS figures really fall short: They ignore a massive chunk of the world’s oil potential future resources. The study looks at conventional oil. That’s regular old black gold, the kind that made Jed Clampett and that nutjob from There Will Be Blood rich. But there are many other kinds of oil, which get lumped into a category called “unconventional oil.” That includes the billions of barrels of tar sands oil in Canada, heavy oil in Venezuela, and shale oil in North Dakota.
American energy independence makes for great political rhetoric. And not much else.
We can thank President Nixon for the term. During the dark days of the 1973 Arab oil embargo, he publicly vowed to wean the United States off foreign energy sources by the end of the decade, an initiative he dubbed “Project Independence.” While things didn’t quite pan out the way he imagined, the dream he conjured has lived on with presidents from both parties ever since.
These days, though, it’s not just politicians who are dreaming. Over the last year, it’s become respectable — even chic, in a geeky, Washington think-tank sort of way — to suggest that the United States might indeed be close to kicking its foreign energy habit. Take this Bloomberg headline from Monday: “America Gaining Energy Independence.” Or this Financial Times article from October: “Pendulum Swings On American Oil Independence.” Daniel Yergin, the renowned oil analyst and Pulitzer Prize winner, now argues that the center of world oil production may be moving from the Middle East to the Western hemisphere.
But even if we’re approaching energy independence, the chances of ever actually getting there are rather slim, especially if our economy is still running on oil in 20 years. Read more.
It’s business as usual in the Gulf of Mexico. But in the year since the Gulf oil spill was stopped, there have been more than 5,000 new oil and hazardous materials spills in the Gulf region. This is a map of the 3,000 reports that can be charted.
Before J.R. Ewing, or the Beverly Hillbillies, or even John D. Rockefeller, there was Coal Oil Johnny. He was the first great cautionary tale of the oil age — and his name would resound in popular culture for more than half a century after he made and lost his fortune in the 1860s.
Read the whole story of Coal Oil Johnny here.