I was asked if I would comment on the potential for U.S. energy independence, and also the effect of “fracking,” relative to environmental impact. In that interview, as printed in the Daily Press last weekend, there were numbers that were not a part of my comments. Even though they were not in quotes, the implication was that I had made those statements. It is important that those be corrected.
The U.S., particularly North America, with proper government cooperation and involvement, has the potential to be energy self-sufficient in a relatively short time. It was recently announced that the U.S. has the highest production of hydrocarbon liquids in the world, including crude oil, condensate, and natural gas liquids. That lead is projected to hold for at least 20 years
The U.S. is currently producing just under seven million barrels of oil per day, and consuming approximately 18.8 million barrels of oil per day. U.S. imports, which were 60 percent of consumption just two years ago, have now dropped to 36 percent. Much of that decrease can be attributed to the “tight” gas and “tight” oil shales. Up until 10 years ago, it was thought that these were not viable energy resources, in that it was not expected that they could be produced within the foreseeable future The technology was not available.
However, beginning 10 years ago, because of new technologies, gas from those “tight” reservoirs could now be produced, and, beginning five years ago, oil and condensates (liquids) from those reservoirs could also now be produced. Those technologies are Measurement While Drilling (MWD) and Reservoir Facture Technology (fracking).
In the 1960s, as a research reservoir engineer for Exxon in Tulsa, George Paff and I obtained, and I personally played back the first MWD in the history of the industry. If “fracking” should be terminated by government action, 4.5 million barrels per day of the seven million barrels per day we now produce would be eliminated from availability, and we would see a dramatic adverse effect on our economy, employment, and our lifestyles.
Due to these new technologies, there has been a tremendoU.S. increase in production, and gas prices have dropped to an average of four dollars per thousand cubic feet of gas. In order for it to be economic for companies to develop those reservoirs, the price must be in the range of $6 per thousand cubic feet.
Consequently, many gas producing companies are now concentrating more on liquid production than on gas production. It takes an average of six thousand cubic feet of gas to be energy equivalent to one barrel of oil. Consequently, at $4 per thousand cubic feet, the same amount of energy can be produced for $24 using gas, in contrast to essentially $96 dollars per barrel for oil. Consequently, the energy from this gas is now available at a cost of 25 percent of equivalent oil cost.
In my opinion, five years from now, every automobile and 18-wheeler in the U.S. should be manufactured to run on compressed natural gas (CNG). The cost to operate our automobiles and trucks will drop to one-third of the current cost, based on per-gallon cost of gasoline, and carbon dioxide generation will also drop by two-thirds.
As a result of dramatic increases in gas consumption since “fracking” justified production, U.S. atmosphere carbon dioxide has dropped to 1995 levels. Increased gas consumption will continue to reduce the carbon dioxide presence in our atmosphere.
Electricity in the U.S. in 2010 was generated from: coal, 45 percent; gas, 34 percent; nuclear, 20 percent; wind energy, 2 percent; and solar, 0 percent. I am a strong supporter of reasonable development of our renewable energy resources.
However, in the next 20 years, renewable resource generation for the U.S. will surely not even reach 5 percent. It is projected that, in 2030, 35 percent of our energy will be provided by oil.
The oil and gas industry is basically a clean industry. There is no knowledge of even one incident where fresh water reservoirs were contaminated due to “fracking.”
Wells are completed in such a fashion that the natural geologic seal of the reservoirs are not disturbed. The oil and gas we produce by drilling has a natural geologic seal. Fracturing technology does not break that seal.
In a recent report, it has been determined that the Middle East region has 2.6 trillion barrels of oil equivalent energy sources, including coal, crude oil, and natural gas, whereas North America, including the U.S., Canada, and Mexico has 13.6 trillion barrels of oil equivalent energy sources. North America can become energy independent very quickly if we utilize our energy within North America.
Please explain to me how we can run our automobiles on wind or solar. If we talk about electric cars, keep in mind that that electricity was generated by coal, oil, or gas. Consequently, there has already been a 52 percent loss of energy availability, since most of those generating stations operate at 48 percent efficiency. The electric automobile is not the solution to our energy problems.
Our primary source of carbon dioxide generation and atmospheric contamination is automobile traffic in the major cities. I was in Houston in November, and it is a 24-hour per day parking lot. If we want to improve our environment, we must make a major change in how we provide transportation in the major cities.
The problem is already intolerable. If we can send men to the moon, solutions to this problem are relatively simple.
The U.S. has an opportunity to improve our atmosphere, and also our economy, if we just take advantage of that opportunity and be knowledgeable when we make decisions.
Kirk Boatright has operated Training Consultants International since 1980.