How much oil left in America? Not much

Preface. If you think we have no worries because we can get arctic oil, think again. We can’t because icebergs mow drilling platforms down in the ocean. On land, massive amounts of expensive new drilling rigs, roads, rail lines, platforms, buildings and other infrastructure need to be built, and maintained every year as permafrost soil bucks and heaves like a bronco trying to shake infrastructure off.

In the first two oil shocks in the 1970s, many intelligent people proposed we should buy oil from other nations to keep ours in the ground for when foreign oil declined. But hell no, Texas, Oklahoma, and other oil states said that we need jobs and CEO/shareholder profits more than national security. Over half of all remaining oil is in the Middle East, which China, Russia, and Europe are much closer to than the U.S.

What saved the U.S. and the world, from conventional peak oil and natural gas decline since 2005 is fracking. But fracking began to decline as early as 2020 according the first report below. The second article is about oil discoveries in the U.S. declining.

This just in: John Hess, CEO of Hess Corporation, told his audience that “key U.S. shale fields are starting to plateau” and will not the next Saudi Arabia. U.S. shale oil production has been a major driver in the growth of world oil supplies. Last year the United States accounted for 98% of global growth in oil production. Since 2008 the number is 73%. so a slowdown or decline in U.S. oil production growth would mean trouble for the whole world. With 81 percent of global oil production now in decline, even a plateau in U.S. production would likely result in a worldwide decline (Kobb 2020).

Peak Fracking in the news:

2020 U.S. Shale Oil Production – All That’s Left Is The Permian And That Won’t Last Forever Either.

Alice Friedemann www.energyskeptic.com  author of “When Trucks Stop Running: Energy and the Future of Transportation”, 2015, Springer, Barriers to Making Algal Biofuels, and “Crunch! Whole Grain Artisan Chips and Crackers”. Podcasts: Collapse Chronicles, Derrick Jensen, Practical Prepping, KunstlerCast 253, KunstlerCast278, Peak Prosperity , XX2 report

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Goehring, L. R., et al. 2019. The unintended consequences of high grading. Goehring & Rozencwajg.

…we believe, new underappreciated forces are now at work in the shales. As we progress through 2020, the retrenchment of drilling activity, combined with the inability for drilling productivity to rise because of “high grading” will produce the potential for a significant disappointment in oil production. If rig counts turn much lower or if productivity continues to disappoint, US shale production growth might even start to turn negative as we reach the end of 2020. Most analysts are still very optimistic about US oil growth in 2020. Estimates range from as low as 1.1 mm b/d to as high as 1.7 mm b/d, but we believe these growth estimates are far too aggressive. Several prominent oil industry veterans are calling for growth as low as 400,000 b/d, which could also turn out to be optimistic. Our Oil Markets section will outline our estimates for US shale growth, as well as global oil supply-and-demand balances.

On a longer-term basis, we believe 2019 results are just the beginning. Of the two major shale oil basins, two are showing signs of exhaustion (the Eagle Ford and Bakken). Even the Permian is starting to show its age. Recent comments from Halliburton and Schlumberger reinforce the idea that the shales may be past their prime–something we have been expecting for several quarters. The underlying issues are geological in nature: the industry is running out of high-quality Tier 1 acreage. While there was hope that drilling and completion technologies could overcome these forces, our data suggests this is unlikely.

Philippe Gauthier. May 3, 2019. US Oil Exploration Drops by 95%. Resilience.org

It is well known that oil discoveries are in continuous decline worldwide in spite of ever-increasing investments. What is less known, however, is that spending on oil exploration is fast dropping in the United States. Exploratory drilling has been decreasing year after year and now stands at only five percent of its 1981 peak. In other words, once the currently producing shale oil wells are gone, there won’t be much to take their place.

According to figures derived from US Energy Information Agency (EIA) data by French oil geologist Jean Laherrère, oil exploration has already peaked twice in the United States. The first time was in the mid-1950s, with just over 16,000 wells drilled in a single year. The second major peak dates back to 1981, with 17,573 exploration wells. This number fell to only 847 in 2017.

Another even more revealing phenomenon is the decrease in NFWs. New field wildcats are exploration wells drilled in areas that have never produced oil, as opposed to wells drilled simply to help better delineate already known oil sectors (shown as red and greenlines in the graph). NFWs also declined by 95%, from 9,151 in 1981 to just 450 in 2017. According to Laherrère, this means that the United States have been almost entirely explored for oil and gas since 1859 and that few sites are worth drilling anymore. “There are only a few unexplored areas left offshore”, he notes.

In comparison, the number of operating wells (used to pump oil from previously known fields) was 646,626 in 1985, 597,281 in 2014, and 560,996 in 2017. However, nearly 400,000 of these wells are very old and produce at a marginal rate – fewer than 15 barrels a day and sometimes as little as one. They are described as marginal wells in the graph above.

It should be noted that the number of operating wells – a figure sometimes used to suggest that the oil industry is still running strong – does not account for this sharp decrease in exploration. Once shale oil production starts to decline – and Laherrère expects this to happen within a couple of years – there will remain few reserves to support US production.

The source material for this post is: Jean Laherrère, Updated US primary energy in quad (April 30, 2019) https://aspofrance.files.wordpress.com/2019/04/updateduspe2019-3.pdf

References

Kobb, K. 2020. Peak Shale Could Spark An Offshore Drilling Boom. oilprice.com

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7 Responses to How much oil left in America? Not much

  1. NJF says:

    Do you have any info on degradation rate of oil in the ground?

    I’m wondering if oil reserves degrade appreciably in the hundreds-of-years scale?

    I know if oil is left in the ground too long it “overcooks”… But other than that seems hard to find good info on that.

  2. WailCircus says:

    You’ll never believe your eyes seeing how people are wailing and beating themselves with metals and sharp objects – part of their religious traditions and practice, especially in the oil-rich parts of Iraq.

    A little further along the western [retaining] wall we come to the Wailing-place of the Jews…. Here the Jews assemble every Friday to mourn over their fallen state…. Some press their lips against crevices in the masonry as though imploring an answer from some unseen presence within, others utter loud cries of anguish” – And this is in Israel.

    Our civilisation might have been in a race to destroy all fossil fuels reserves the quickest possible since early coal in the 1700s Britain – unconsciously.

    Humans prove so primitive they have burned all the millions of years in the-making fossil fuels in a mere 300 years.

    Wailing this loss, from now on, will supersede all other wailing – for the rest of the future.

    Fossil fuels in the hands of primitive humans – proved inhumane, too much powerful, too evil – as they’ve empowered extreme social engineering and centralisation.

    This far, in the age of fossil fuels, the extreme social engineering and centralisation have even killed the future and rendered it a history before even born.

    Wailing the destruction of all fossil fuels in the last 300 years – until the end of time?

    Or, celebrating the natural future returning back to earth after fossil fuels are out?

    In the last 300 years, humans have embarrassingly proved they’re so primitive, indeed!

    • Cynic says:

      Very true.

      But really it’s only the humans of the Scientific Age who are so dumb.

      For example, in 13th century England, the abbot of a monastery set out rules for the exploitation of woodland which still held good in the 19th century, and which had not destroyed the wood as a viable entity.

      Careful observation of nature and her growth patterns, wise rules.

      It’s not so hard really.

  3. Kevin M. says:

    We can probably buy a little more time but considering climate change we probably shouldn’t.

    https://phys.org/news/2020-09-inexpensive-non-toxic-nanofluid-game-changer-oil.html

    The world needs to get prepared to live with renewables and probably at least half the available energy today. Even if we get a technology fix efficiency almost always pays for itself.

    I’m alarmed that we aren’t more prepared and we are progressing so slowly.

    • energyskeptic says:

      Wow, thanks for bringing this to my attention. I’ve written my petroleum scientist contacts for their opinion. Dang, I’d been hoping that declining fossils would keep the IPCC hothouse earth 8.5 scenario from happening.

  4. Kevin M. says:

    I would seriously consider moving from the disaster theme park known as California ASAP…

    https://www.wired.com/story/the-biblical-flood-that-will-drown-california/