Look at the above as a small test of human intelligence applied to
dealing with an impending Peak Oil future.-tr
LOL, Too true!
Kammen et al include the petroleum feed stock as a component in the
cost of producing gasoline. This is like using the sun's energy as a
cost in producing the corn to produce ethanol.-tr
Even EROEI 'experts' give a different value for oil at the wellhead
from finished gasoline. All crude oil in the refinery must be heated
to undergo distillation and that heat is provided by....a large
amount of crude oil. But anti-ethanuts like Pimental remove the use
of distiller's grain for distillation heat from his energy equation
substituting natural gas. You can't have it both ways--Kammen has
chosen to add distillation heat in both crude oil and ethanol. If you
do that, then gasoline turns out to be slightly energy negative
according to the article!!!! Interesting!
If you noticed the article is not couched in your favorite
paradigm 'EROEI'( which is quite confusing) but in the better term
of 'net energy'.
Dishonest or stupid? [I hope someone asks Patzek why they let
such 'an idiot' into UC Berkeley or testify to Congress-something I
doubt Patzek or Pimental have ever done;)]I just do not know, but I
am sure we better find a way to do credible analysis for knowing the
relative merit of our energy sources, because the day is rapidly
approaching (if not already here) when mistakes in energy production
and use have enormous and unrecoverable costs. And we have been
messing around with this for some 33 years.-tr
I suggest that certain folks look at the EROEI of tar sands (and oil
shale too) for poor net energy process rather than ethanol because
that whole bonanza seems to be fast running out of gas(literally) and
they are very big producers of CO2(with not-so-hidden costs). Think
of that as EROEI in action.
Curing oil sands fever
Despite wide-eyed predictions, serious constraints remain in
developing Alberta's heavy oil.
By Steve Hargreaves, CNNMoney.com staff writer
October 7 2006: 12:38 AM EDT
NEW YORK (CNNMoney.com) -- The answer to America's oil addiction lies
Or so goes one line of thinking. As oil supplies got tighter and
crude prices soared over the last few years, tens of billions of
dollars flowed into an effort to develop the biggest oil reserve
outside Saudi Arabia: Alberta's oil sands.
Along with the development rush have come rosy predictions on how
much this secure, close, proven supply of oil might yield. Four
million, 6 million, even 10 million barrels a day, which is nearly
half America's total daily consumption and would easily replace all
imports from the Middle East.
The only thing is, those numbers may be far too high.
Making a barrel of clean, light crude from the thick, dirty oil sand
uses massive amounts of water, massive amounts of electricity and
requires a large pool of labor in an otherwise sparsely populated
"People jump to the assumption that we can immediately ramp up to 9
million barrels per day and save the world," said Peter Tertzakian,
chief energy economist at ARC Financial, a Calgary-based private
equity firm. "But it's just not going to happen."
Stuck in the sand
This isn't to say the oil sands won't be a viable energy source. Two
hundred miles north of Edmonton, covering an area roughly the size of
Florida, they already produce more than 1 million barrels a day.
U.S. majors ConocoPhillips (Charts) and ExxonMobil (Charts), as well
as Royal Dutch Shell (Charts), have interests in the area, although
Canadian firm Suncor (Charts) and the consortium Syncrude are the
Getting a product similar to light crude usually involves one of two
The first uses a model borrowed from open-pit mining, in which the
sands are dug out of the ground with heavy equipment, then mixed with
steam, hot water and caustic soda to create a slurry.
The slurry then enters a separation tank where bitumen, the valuable
product in this process, rises to the top and is skimmed off. The
bitumen is then heated again to remove impurities, resulting in a
synthetic light, sweet crude that's easy to refine.
The other method uses a well to inject steam into a seam of oil sand
deep below the earth's surface. The resulting slurry then drains down
into a second well drilled below the first, where it's pumped to the
This eliminates the need to strip-mine the area, but creating the
needed steam uses vast amounts of energy.
And energy is the first limitation people bring up at the mention of
the oil sands.
Tertzakian said it takes the equivalent of 0.7 barrels of oil to
create one barrel of oil sands product.
[Tertzakian, the energy economist gives a EROEI of 1.42, I guess but
does that include everything??]
What's more, most of the energy needed to make the stuff currently
comes from natural gas, an energy-rich, clean fossil fuel.
"It's like using caviar to make fake crab meat," said Marlo Raynolds,
executive director of the Pembina Institute, a Canadian environmental
Experts say most of the natural gas Canada currently exports to the
United States will be eaten up by the oil sands projects. To fuel
further expansion, they say, Canada will have to import natural gas
from Alaska. Some have even suggested going nuclear, although that
idea has gained little traction so far.
Another constraint is water. Both extracting methods use huge
amounts, up to two barrels for every barrel of oil produced.
Even with production running at one million barrels a year, concerns
are already being raised over the drawdown from the major rivers that
flow through the region.
"At some point it's going to reach a tipping point when people say
enough is enough," said Raynolds.
And then there's the labor question.
If you're looking to make truckloads of money doing mindless work,
head to Fort McMurray, the biggest town close to the oil sands.
A quick read of the classifieds at the town's newspaper turns up jobs
selling concessions at the movie theatre paying the equivalent of
U.S. $10 an hour. Janitor positions start at $17.
For more skilled workers, a welder can bring in $80,000 a year, more
than double the average in the U.S. And that's without overtime.
"We now have signing bonuses for people who work in coffee shops,"
said Tertzakian. "We just don't have the labor pool to match $90
billion in investment."
So how much can they pull from the ground in Alberta?
The Canadian government and many of the companies up there put the
number somewhere around 4 million barrels per day by 2015, still a
significant amount roughly equal to America's total crude production.
"The production levels aren't unrealistic at all, it's just a
question of time," said Sheraz Mian, a senior oil and natural gas
analyst at Zacks Investment Research.
But others are less sanguine.
The U.S. Energy Information Administration, not generally known for
issuing bearish reports, puts the number at 2.3 million barrels per
day by 2015.
Tertzakian estimates maybe 2.5 to 3 million barrels per day and
cautions against too much optimism.
"Nobody should feel comfortable that Canada's oil sands are going to
single-handedly satisfy the world's energy needs," he said.