Peak Oil in Alaska

October 27, 2010 11:49 AM

Recent exploration drilling and 3-D seismic surveys reveal the U.S. Geological Survey's optimistic 2002 assessment of Alaska's untapped oil reserves is actually off by about 90 percent. Oil and Gas Online explains the new geologic analysis and difficulty predicting petroleum reserves.
posted by Chinese Jet Pilot (54 comments total)

Drill, baby, drill!
posted by hincandenza at 11:53 AM on October 27, 2010 [5 favorites]

October surprise?
posted by The White Hat at 11:53 AM on October 27, 2010

"The organization also estimates 8 trillion cubic feet less gas than a 2002 estimate of 61 trillion cubic feet of undiscovered, conventional, non-associated gas -- meaning gas found in discrete accumulations with little to no crude oil in the reservoir."

So much for drill, baby, drill. By the way, the 896 million barrels that are now predicted (as opposed to the 10.6 billion from the 2002 estimate) would last the US about 43 days.
posted by jedicus at 11:55 AM on October 27, 2010 [11 favorites]

Of course, watch the right spin this as either a conspiracy by the government to kill off drilling in Alaska or proof that we need to do vastly more offshore drilling.
posted by jedicus at 11:56 AM on October 27, 2010 [1 favorite]

Damn, jedicus beat me to it.
posted by Old'n'Busted at 12:00 PM on October 27, 2010

Think of it this way: If you're running close to your credit card limit, do you change your lifestyle?

HELL NO!

You just get more credit cards. It's good for your lifestyle, and good for the economy because it injects liquidity into the market.
posted by mccarty.tim at 12:00 PM on October 27, 2010 [3 favorites]

The group estimates about 896 million barrels of such oil are in the reserve, about 90 percent less than a 2002 estimate of 10.6 billion barrels.

It's totally understandable. I do this with my checking account all the time.
posted by Danf at 12:01 PM on October 27, 2010 [4 favorites]

Ha Ha, honestly officer I though I was doing 10 miles per hour, not over a hundred!
posted by 2bucksplus at 12:03 PM on October 27, 2010

"The weathermen predicted 8 to 12 inches of snow. There was 36 inches of snow. Even at their best estimate, they were two feet off. What other job lets you do this? If you were a roofer, and you built a roof, and the roof was 'two feet off,' you'd still be in prison."
-Lewis Black
posted by XQUZYPHYR at 12:04 PM on October 27, 2010 [2 favorites]

Of course, watch the right spin this as either a conspiracy by the government to kill off drilling in Alaska or proof that we need to do vastly more offshore drilling.

That's optimistic. Spin requires cleverness. The more likely response will be a snarky blog post, I'd guess from RedState (ironically co-owned by a CNN correspondent) saying "oh look, it's confirmed that there are hundreds of millions of barrels of oil there LET'S GET IT THEN LOL" because no matter how stupid something sounds from the right it's a great thing to them to say it if it annoys liberals.
posted by XQUZYPHYR at 12:08 PM on October 27, 2010 [2 favorites]

Uh-oh.
posted by jhandey at 12:11 PM on October 27, 2010

Now we get to wait and see if Saudi Arabia is fibbing as well.

Is there any other critically important part of our economy that we'd like to farm out to other parts of the world? Maybe we can sell China our arable land if they can promise a drop in food prices.
posted by notion at 12:12 PM on October 27, 2010 [1 favorite]

I'll have to get back into the habit of checking national gas prices and comparing what the equivalent price would be in donating blood.

I figure there's a tipping point where the ratio hits so people start shooting each other with crossbows for petrol and having chainsaw duels in Thunderdome.
posted by yeloson at 12:15 PM on October 27, 2010

chainsaw duels in Thunderdome

Electric chainsaw duels.
posted by The White Hat at 12:18 PM on October 27, 2010 [2 favorites]

I read the Oil and Gas summary of why it happened in this instance, but I'm curious whether this kind of misinterpretation of gas deposits as oil is common. If so, maybe exercise a little more caution before breathlessly announcing potential as fact...

...

Haha, who am I kidding?
posted by empyrean at 12:22 PM on October 27, 2010 [1 favorite]

Human sits down at the bar, looking dejected.

Beetlegeusian: Hey...waiddaminute...aren't you...yeah, hey Gorbok, check this out - it's that species that based their entire freaking civilization on burning plant hydrocarbons! Holy crap man...how're...how're you guys doing with that? No, I'm serious - they burn hydrocarbons right *giggles* right into their own atmosphere!

Human: Come on guys...gimme a break...

Centauran: No waaay! It really is a human. I thought you guys were extinct! Tell me something, is it true? I heard you guys actually had photovoltaics, nuclear, wind power, but you just kept burning the ancient plants? Unreal!

Human: Yeah, ok assholes, have your fun...I just want a quiet drink...

M101 Plasma Being: Whoa, take it easy big guy - you're not going to take a crap on the bar or anything, right? You should know most folk around here like to separate their intakes and exhaust...

Human: All right you punk, that's it, put em' up!

Human and M101 Plasma Being grapple ineffectually before the bartender wafts them apart.
posted by Salvor Hardin at 12:25 PM on October 27, 2010 [34 favorites]

> Electric chainsaw duels.

Solar powered electric chainsaw duels.
posted by ardgedee at 12:26 PM on October 27, 2010 [3 favorites]

I read the Oil and Gas summary of why it happened in this instance, but I'm curious whether this kind of misinterpretation of gas deposits as oil is common. If so, maybe exercise a little more caution before breathlessly announcing potential as fact...

Shell Oil Reserves Mis-statement
posted by atrazine at 12:27 PM on October 27, 2010 [1 favorite]

We are so fucked.
posted by empath at 12:31 PM on October 27, 2010 [4 favorites]

I've heard we've been at peak oil for well, as long as I've been on the Internet. When does the entire apocalypse thing start happening?

People are still driving around big trucks and the automotive world still spins. Everything is still made out of plastic. The "green" thing has resulted in only "I'm Not a Plastic Bag" fashion accessories. How is that possible?
posted by Threeway Handshake at 12:36 PM on October 27, 2010

Yeah. On the one hand, great for the wilderness. On the other hand.. We. Are. Fucked.
posted by Ahab at 12:37 PM on October 27, 2010

Now many of those who were advocating drilling in the region will change their minds and push instead for aggressive investment in various renewable energy technologies.
posted by Throw away your common sense and get an afro! at 12:41 PM on October 27, 2010 [1 favorite]

Is there any other critically important part of our economy that we'd like to farm out to other parts of the world? Maybe we can sell China our arable land if they can promise a drop in food prices.

I know lol, or we could sell our parking meters to Abu Dhabi.
posted by furiousxgeorge at 12:45 PM on October 27, 2010 [2 favorites]

When does the entire apocalypse thing start happening?

When it happens, it'll happen a lot quicker than you'd expect. If you have exponential growth so that the usage of a resource doubles every x years, the last half of the resources disappears in x years, no matter how long it took to get there. It looks like we're doubling oil use every 25 years or so. Once we're at the point where we have as much oil reserves left as mankind has ever used up to that point, it'll all be gone in 25 years.

Of course, that depends on continued exponential growth throughout the last 25 years. There's lots of reasons that it would stop well before then (war, famine, disease, rationing) and most of them aren't good.
posted by empath at 12:48 PM on October 27, 2010 [8 favorites]

When it happens, it'll happen a lot quicker than you'd expect. If you have exponential growth so that the usage of a resource doubles every x years, the last half of the resources disappears in x years, no matter how long it took to get there. It looks like we're doubling oil use every 25 years or so. Once we're at the point where we have as much oil reserves left as mankind has ever used up to that point, it'll all be gone in 25 years.

This just gave me a nasty shock. I mean, my body literally jolted when I read that. In all I've read about Peak Oil I've never heard that before, and it's utterly sobering.
posted by 40 Watt at 12:52 PM on October 27, 2010

We are so fucked.

dN/dt=rN(K-N/K). K is just a little bit closer now. I think we will experience tremendous losses as we approach and exceed it, but maybe we'll make it in the end.
posted by kuujjuarapik at 12:53 PM on October 27, 2010 [1 favorite]

I've heard we've been at peak oil for well, as long as I've been on the Internet. When does the entire apocalypse thing start happening?

People were starting to freak out because gas prices kept rising and were not lowering. Fortunately, before they got too far above $4/gal, the global economy collapsed, and people couldn't afford to buy gas any more, so production could meet demand again, and the prices fell back down to $3/gal (which is historically high, but nice and low considering we're at peak).

Once the global economy gets up to speed again, gas prices will resume their march, which will retard the global economy. The question is, will the brakes be gentle, allowing large sectors to transition to electric, or will it be a rollercoaster of recessions and recoveries as the economy and price of oil feedback into each other in a delayed looping cycle downwards?

Most people don't connect today's low gas prices with the global recession, so when gas is over $4/gal again, people will complain but assume it will come down again to it's "natural" level. (If we end up on a rollercoaster, it will.)
posted by -harlequin- at 12:53 PM on October 27, 2010 [4 favorites]

When does the entire apocalypse thing start happening?

Depending on your definition of apocalypse, either never or we've been living it for quite a few years already.

How is that possible?

"Hey, I've been falling for 30 seconds and I'm not dead yet! Why would I need a parachute?"
posted by Bangaioh at 12:54 PM on October 27, 2010 [7 favorites]

>I've heard we've been at peak oil for well, as long as I've been on the Internet. When does the entire apocalypse thing start happening?

You've heard incorrectly. Peak oil is a fact: there is a finite amount of oil on Earth, and eventually, we will exhaust half of that supply. This all stems from a geologist named Hubbert who accurately predicted that 1970 would be America's peak production year. He was right. Worldwide reserves are a little harder to pin down, but it's going to happen eventually.

>People are still driving around big trucks and the automotive world still spins. Everything is still made out of plastic. The "green" thing has resulted in only "I'm Not a Plastic Bag" fashion accessories. How is that possible?

The reason there are still leftovers, especially in America, is because the only thing that matters to us is that latest quarterly report. Our market well change only when environmental damage and price instability threaten profits, which only happens when crops fail, or when a barrel of oil doubles in prices in a month, and during other calamities that have far more important consequences than a drop in profit.

The fear of peak oil is that we are so dependent on that resource that we may be unable to transition to renewable energy easily if we're having trouble just moving food around. The oil companies know that the tank is on red, but they're going to try to ride it all the way to the bank anyway. If they have guessed wrong, we will all end up walking.
posted by notion at 12:57 PM on October 27, 2010 [1 favorite]

So, with less oil == less cars, that means less traffic problems for me, right?
posted by Old'n'Busted at 12:58 PM on October 27, 2010 [1 favorite]

about 90 percent less than a 2002 estimate of 10.6 billion barrels.

This looks like lazy reporting to me, from ProQuest:

"The U.S. Geological Survey (USGS) surveyed the region in 1984-85, and published estimates in 1998 that there was a 95% chance of finding 11.6 billion barrels of oil in the 1002 area, and a 5% chance of finding 31.5 billion barrels or more. However, not all of this oil would be recoverable...
At a price of $24 a barrel, the USGS estimated a 95% chance that 2.0 billion barrels of economically-recoverable oil would be found"

Compare that with the newer USGS figures
"An estimated 1.3 to 5.6 billion barrels of those technically recoverable oil resources is economically recoverable at market prices of $22 to $30 per barrel."

I'm not seeing much difference there.
posted by Lanark at 1:00 PM on October 27, 2010 [1 favorite]

When does the entire apocalypse thing start happening?

It doesn't. What happens is that oil becomes a shit ton more expensive, especially when most petroleum has to be used for things like plastic and synthetics rather than gasoline. Just as everything else in this country that should be considered a basic human provision (clean air, health care, education) becomes expensive it slowly becomes considered a "luxury" and everyone who isn't rich gets told, passively, to shut up and deal with it.

This has, in fact, already been field tested. Remember what gas was before the Iraq war? Average price was about a $1.80 a gallon. This was seven years ago. That's it. Now we've been told to accept as a "relief" that it's below $3.50. Will it get worse when there is "no" oil? Sure. And fifteen years ago there were no websites. We adapt.

99% of America moves on. We eat out less, we scrape together what we need and we deal with it. It is, ironically, what people are shown doing quite heroically in stories about the world after an actual apocalypse. I guess "putting up with shit" is a lot more dynamic when the "shit" is zombies.
posted by XQUZYPHYR at 1:03 PM on October 27, 2010 [1 favorite]

Once we're at the point where we have as much oil reserves left as mankind has ever used up to that point, it'll all be gone in 25 years.

Yes, and no. While mathematically correct, the scenario you've suggested is impossible in real life, because there's no way we could (even if we really wanted to) keep extracting oil at an ever increasing rate and then stop suddenly only when all of it is gone. So exponential growth will stop long before all recoverable oil is extracted. The main problem with peak oil is the size of the tap, not the total capacity of the tank.
posted by Bangaioh at 1:04 PM on October 27, 2010 [1 favorite]

Everything is still made out of plastic.

Disposable plastic might suck, but durable plastic is one of the great modern engineering materials. Right up there with metal and ceramic. Fortunately, engineering plastic is valuable enough that we'll never run out.
posted by ryanrs at 1:08 PM on October 27, 2010 [2 favorites]

Could someone help me find a graph related to this? It was (I recall) a percentile graph showing sources of oil and somewhere along the line a category of something like "Future sources/ Unknown reserves" showed up and started increasing in size over the years.
posted by boo_radley at 1:08 PM on October 27, 2010

Send your goons round to the geologist's office. Problem solved.
posted by Artw at 1:08 PM on October 27, 2010 [1 favorite]

less oil == less cars

Well, less gas-fueled cars anyway. Electric cars are available now and there are a lot more coming out in the next few years. As oil gets more expensive these will replace gas cars. If oil gets expensive fast this will be messier for people who cant afford relatively new cars, of course, since it will take a while before the electric market has cheap used cars for sale.
posted by wildcrdj at 1:16 PM on October 27, 2010

Compare that with the newer USGS figures

Those aren't the newer figures. Those are the inaccurate 2002 figures. "Created: May 13, 2002 Last modified: May 17, 2005 (mfd)"
posted by jedicus at 1:18 PM on October 27, 2010 [1 favorite]

Is this it, boo_radley?
posted by Bangaioh at 1:19 PM on October 27, 2010 [2 favorites]

All I know is, someone at the USGS is likely to get curb-stomped over this.
posted by mark242 at 1:20 PM on October 27, 2010

That is the bunny, thank you bangaioh.
posted by boo_radley at 1:24 PM on October 27, 2010

Not to be a pot calling kettles black here, obviously I'm a first-world likely energy waster myself, but also worth noting that the whole "OMG we're gonna run out of _____" rhetoric is really silly from the perspective of the third world. They've never run out of ______ because they never had _______ to begin with.

What happens in impoverished societies? Alterations to consumption. A co-worker of mine a few years back traveled to Addis Abbaba to report on the markets there. This is a culture that doesn't waste anything, not just because of the poverty that makes waste a folly but because they simply don't have dumps for garbage to begin with.

The "apocalypse" America is facing is that it's going to be forced- economically far more than geologically- to recycle. The political argument has never been about whether this will happen; it's been about how fewer people can die as we realize it.
posted by XQUZYPHYR at 1:25 PM on October 27, 2010 [1 favorite]

I remember last time I read an article on FreeRepublic about the severe overestimation of an oil-shale field in Wyoming. USGS scientists had overestimated the amount of recoverable oil by a similar ridiculous amount (something like 90%).

The general consensus on FR was that the USGS had obviously been infiltrated by communist or foreign agents who were seeking to wreck our economy by sabotaging our virtually limitless oil reserves.

This is, basically, why we're fucked. We've created an environment in this country where scientific discoveries can be cast aside as "enemy propaganda" and where clear-headed thinking is dismissed as "doom and gloom pessimism".

We can't see the world as it really is, because it's too ugly. So we choose to see it however we want to see it, and we're going to suffer for that.
posted by Avenger at 1:39 PM on October 27, 2010 [14 favorites]

The lesson to be learned is simple: we're still really, really bad at predicting oil field yields.
posted by atbash at 1:40 PM on October 27, 2010

I should also point out that the FR posters believed the original, overestimated USGS claim to be true, but that since then the USGS had been infiltrated and the new, realistic numbers were obviously false. They based that opinion on nothing more than the strong belief that America has lots of oil.
posted by Avenger at 1:41 PM on October 27, 2010 [1 favorite]

Electric cars are available now and there are a lot more coming out in the next few years.

Not only that, but some of them may even be cars that have more selling points than just "it might be more green."
posted by Hylas at 1:46 PM on October 27, 2010

Expensive oil --> efforts to reclaim hydrocarbons from plastic in landfills and the like, drilling in more remote locations, fuel efficiency going up across the board, alternative energies making economic sense.

You aren't going to see oil consumption drop exponentially fast because there will be efforts from both the supply and demand side to make the most out of what we have. The free market can't see into the future very well, but once the impact of expensive oil hits everyone in the wallet hard enough and long enough, businesses and people will shift priority, and shit will get done.
posted by Dmenet at 3:22 PM on October 27, 2010

Peak oil, yo.
posted by PuppyCat at 5:49 PM on October 27, 2010

Threeway Handshake: "How is that possible?"

Because "the greatest shortcoming of the human race is our inability to understand the exponential function".
posted by Rat Spatula at 7:39 PM on October 27, 2010 [4 favorites]

Avenger: "So we choose to see it however we want to see it."

Because I'm too polite to walk away from people, I get cornered a lot at parties. A while back it was the retired truck-driver father of a FOAF's new husband. Prior to trucking, he'd been on a drilling crew in the northern plains of the U. S. "There's plenty of oil down there," he assured me.

Dang, I forgot to ask if he understood the exponential function.
posted by Rat Spatula at 7:47 PM on October 27, 2010

The lesson to be learned is simple: we're still really, really bad at predicting oil field yields. much of anything.
posted by thsmchnekllsfascists at 8:11 AM on October 28, 2010

While mathematically correct, the scenario you've suggested is impossible in real life, because there's no way we could (even if we really wanted to) keep extracting oil at an ever increasing rate and then stop suddenly only when all of it is gone. So exponential growth will stop long before all recoverable oil is extracted. The main problem with peak oil is the size of the tap, not the total capacity of the tank.

I did allude to that. We won't have continued exponential growth until it runs out. Our use of the resource will go down well before the end, but almost all of the reasons that the growth will slow down are bad, unless we somehow manage to get onto alternative energy sources, or vastly improve our energy efficiency (which are both possible, and are vital political goals, for lots of reasons).

I guess my main point was that unless something changes the end of oil will come very quickly.
posted by empath at 8:48 AM on October 28, 2010

I do this for a living. I have only the slightest acquiantance with the geology of Arctic Alaska, however.

There are lots of different approaches to assessment; which one you choose generally depends on how much and what the quality of the data you have at your disposal, and how much time and money you have to conduct the assessment.

In every assessment, a series of estimates relating to potential hydrocarbon accumulations in a region or of a certain style in a region (this is what is referred to as "plays" in the USGS publications linked) form inputs to the estimate. Some of the inputs are ranges of continous variables: the porosity of reservoir interval might be estimated as between 4 to 8 percent, for example, with a most likely value of 6 percent. The variable range itself might be modelled as a normal distribution or any other kind of pdf. Overlain on that is generally a series of risk estimates: maturity risk (chance that source rocks did not reach high enough temperatures to expel hydrocarbons); trap timing risk (chance that hydrocarbon maturation and migration occurred before suitable traps were in place); seal risk (chance that traps failed to contain hydrocarbon accumulations) and others. These are not modeled in the same way as they typically don't represent a continuous range of variables but rather discrete states. The consequence of these risks is rather stark: having reservoir porosities 10% less than your most likely estimate may drop the resource size by 10%; having the seal not present decreases it to zero.

All of this modeling depends on the best state of your knowledge (i.e. the data you have on hand) at the time. The more fragmentary your knowledge, the greater the uncertainties. These uncertainties are themselves modeled, but that's an even trickier business. For instance, you might estimate reservoir porosities to have a certain distribution and certain statistical characteristics. In a mature basin, with a well-understood play, and well constrained geology, you might know this distribution to a high degree of confidence. Walking into a frontier area, you are forced to estimate these either based on a putative analogous play or basin or a simulation of how the geology of a basin formed.

Again, I've only a passing acquiantance with Arctic Alaskan geology, but its clear that at the time of 2002 assessment, the USGS was relying on very little data. In particular, there was almost no drilling in the NPRA apart from the Alpine discovery. Therefore all modeling of reservoir pressure, formation characteristics, and thermal history inputs to the assessment were done in the absence of actual data. What values were used had to be based on simulations and the constraints of wells drilled in the extreme NE corner of an area the size of a good size state. Guess what? Their model of the thermal evolution (and consequences for reservoir pressure and hydrocarbon migration) was wrong.

Now, this doesn't mean that they were incompetent or, worse, lying. In the original assessment, they would have had to quantify or qualify their confidence in their thermal model. Within their range of possible resource volumes for the Alpine-type play ("Upper Jurassic stratigraphic play") would have been a series of scenarios where gas displaced oil, as well as where no hydrocarbons of any kind were found. They assessed the likelihood of these scenarios to be rather low, of course. And, yes, almost a decade later, and a round of exploratory drilling later, there is data that replaces model simulations, and it turns out that resource sizes are (*probably*) much, much lower.

For all of those bracing yourselves for the zombie apocalypse, however, understand that the outcome could have gone in the opposite direction. In 2002 the USGS assessed the likelihood of a Prudhoe bay sized field to also be extremely low. Presumably, that likelihood is now assessed as much, much lower. In many basins, this happens.

Now, there is the possibility that political or psychological influences on the estimation and modeling process may systematically skew probabilistic resource assessment. You might have a feeling (given the general tenor of the thread, perhaps) that even if the USGS scientists working on this weren't dirty fibbers, there might have been subtle pressures that skewed the way they incorporated data and model inputs. Certainly this is a possibility and its hard to say, really (without taking all the original data and handing it to a completely fresh set of eyes and brains operating in a different context).

As it turns out, from what the experience with probabilistic assessment within industry (as opposed to regulatory or government body) has been over the last few decades, it seems as though these kind of influences generally skew assessments *downwards* or more pessimistically. Almost invariably (I can think of a recent counterexample, where a couple of hundred of millions of dollars later, several billion barrels went away... oh well!), the initial assessments of original hydrocarbon in-place for a basin or a play turn out to be low and have to be continually revised upwards. Note this is for the in-place assessment, not the ultimate recoverable. Recovery rates themselves generally go up as they are a function of technology and capital availability.

Anyways, carry on, always interesting seeing how science gets refracted once you get a few removes away from it....
posted by bumpkin at 8:59 AM on October 28, 2010 [5 favorites]

I did allude to that.

You alluded specifically to war, famine, disease and rationing, all of which may be caused by something other than geologic/technologic constraints. My point was that even in a perfect world, where everything was perfectly efficient and humanity's sole purpose was to extract oil as fast as possible, physical limits would eventually prevent the rate from increasing any further, even with a lot of potential oil still in the ground, because this is very different from this.

I was not implying you did not know that, just making it clearer for people who might be reading about peak oil for the first time that the total amount of oil doesn't really matter that much when the good stuff is mostly gone.
posted by Bangaioh at 10:38 AM on October 28, 2010