A frequently repeated line among oil industry experts (e.g., a, b) and members of a certain ethically challenged political sect is that the United States has larger oil reserves than Saudi Arabia. The media, including the notoriously liberal New York Times, pounced on reports of the coming American oil sheikdom with shale as savior.
The narrative continues from there. Not only are fears of a "peak oil" economic crisis unfounded, but we are soon to have a glut of domestically produced oil. In the process, America will be blessed with energy independence and enough prosperity to pave our streets with gold.
There is one teeny, tiny fly in this richly perfumed ointment. It is built on slippery semantics in the difference between oil shale and shale oil. The difference matters.
In this Oil Drum article, Robert Rapier does an excellent job of shining a bit of light on the differences in oil found in shale. (I am stealing Rapier's cooked (shale oil) versus uncooked (oil shale) metaphor.)
Shale oil is oil that nature has cooked to perfection but locked in inconvenient to siphon shale jars. Add highly pressurized fluids (a.k.a., hydraulic fracturing) and that Texas Tea flows like milk and honey. The few billion recoverable barrels of this crud in the Bakken and Eagle Ford formations are fueling our current production boomlet, but hardly threaten to dethrone Saudi Arabia.
Oil shale, on the other hand, is a rock (lovingly referred to as kerogen by the petrogeology crowd) that nature left uncooked. Turning it into something other than a smudge pot requires a lot of loot, energy, and water. These lumps of carbon crap can be found in abundance in the Green River Formation in Utah, Colorado, and Wyoming. The trillions of potentially recoverable reserves of kerogen are what is supposed to make the Saudis green with envy.
But the Green River formation is the source of talk of those enormous oil resources -- larger than those of Saudi Arabia -- and it is a very different prospect than the tight oil being produced in North Dakota and Texas. The oil shale in the Green River looks like rock. Unlike the hydrocarbons in the tight oil formations, the oil shale (kerogen) consists of very heavy hydrocarbons that are solid. In that way, oil shale more resembles coal than oil. Oil shale is essentially oil that Mother Nature did not finish cooking, and thus to convert it into oil, heat has to be added. The energy requirements -- plus the fact that oil shale production requires a lot of water in a very dry environment -- have kept oil shale commercialization out of reach for over 100 years.In other words, without turning the Green River Formation into an industrial cesspool and drain an already arid region of its water supplies, America is not going to supplant Saudi Arabia in anything other than income inequalities and heavily armed religious extremists. Think of it as the "Great Oil Swindle."
The confusion between oil shale and shale oil in terms of United States oil reserves does not seem all that innocent. The recent Republican Party standard bearer was selling the idea that energy independence was possible if we just open up all public lands to drilling and mining. The energy independence meme was convenient fiction to justify fleecing the public of natural resources at bargain basement prices. I am sure the appearance of all these glowing reports in the run-up to the 2012 election was just a happy coincidence.
So, to recap. Shale oil is a liquid that requires a fracking laxative to extract. Oil shale is a solid that requires wasting gobs of water and energy to turn western Colorado, eastern Utah, and western Wyoming into the largest toxic dump in North America.
There are two other elements of the oil shale narrative that have received less attention, particularly by the Drill, Baby, Drill™ crowd.
Oil shale will be a greenhouse gas nightmare to produce, with carbon emissions far exceeding even tar sands extraction. Robert Rapier puts it blithely:
The production of shale oil is more energy intensive (i.e., has higher carbon emissions) than for the oil sands, it has a high water requirement in a dry climate, and it is potentially a huge new source of carbon dioxide emissions.Oil shale is climate suicide.
And then there is economic feasibility. Rapier and others have questioned how much above $100 a barrel do oil prices have to go before oil shale is commercially viable. That means even in the simple minds of oil company executives and politicians, all that kerogen will only produce an expensive alternative to conventional crude.
Before we leave the economic viability issue, there is one more fun fact to mull over. During the 1980s, the Department of Energy invested $7 billion (pdf) in research and loan guarantees for oil shale. In other words, 14 times the cost of Solyndra loan guarantees with zero payoff. Adjusted for inflation, that works out to be 35 Solyndra units. Gosh. Where was the outrage from the fiscal hawks? Or perhaps they should explain why we are still subsidizing oil shale projects courtesy of the 2005 Energy Policy Act?
The next time you hear that American oil reserves rival those of Saudi Arabia, just remember they want you to confuse tight oil in shale formations with oil shale. They also want you to forget the costs and climate consequences of playing in the Green River Formation. Time to slam the door on stupidity.