Reason’s Ron Bailey
rejoices that, surprise, more oil to be found drilling deeper and venturing further out to sea from the
‘Peak Oil Delayed Again? Three oil companies announced a significant find of a large
new oil field (between 3 and 15 billion barrels) in the
of Mexico yesterday. This is exactly the kind of discovery and
technological tour de force that the US Geological Survey's 2000 World
Oil and Gas Assessement suggested will delay any global peak in oil
production until at least after 2030. To wit:
-- As drilling and production within discovered fields
progresses, new pools or reservoirs are found that were not previously known.
-- Advances in exploration technology make it possible to identify new targets within existing fields.
-- Advances in drilling technology make it possible to recover oil, and gas not previously considered recoverable in the initial reserve estimates.-- Enhanced oil recovery techniques increase the recovery factor for oil and thereby increase the reserves within existing fields. Of course, political factors (say, instability or orneriness in
Left unsaid by Ron is that in the USGS report, you will learn that 'recoverable resources' are economically defined--whenever prices rise, reserves of economically unrecoverable oil- which is what this deep field was at $20 a barrel, automatically rise . And when prices fall- below about $ 50 a barrel in this case, reserves evaporate back into the mirage of unending competitive supply .
Recent months have seen crude prices per gallon higher that the per barrel price when Ron was born,but posterity may not rejoice at the excellent prospect of perpetual reserve inflation, nor see much oil flowing downhill to consumers from the imaginary extension of Hubbert's peak into the economic stratosphere. When the price of peanut oil looks like peanuts , peanut oil will be pursued. Alas, you cannot drill for new peanut acreage , but synthetic crude is another matter.
Oil is what you make of it.