INSIGHT: US leads world in fossil energy resources

05 November 2009 19:31  [Source: ICIS news]

By Joe Kamalick

WASHINGTON (ICIS news)--A new congressional research report says that the US holds the world’s largest fossil fuel resources - more than twice that of Saudi Arabia, for example - and Senate minority leaders want the Obama administration to let industry get at it.

In a study requested by Senator James Inhofe of Oklahoma, the ranking Republican on the Senate Environment and Public Works Committee, the Congressional Research Service (CRS) said that the US reserves of oil, natural gas and coal plus technically recoverable undiscovered oil and gas total 1,321bn bbl of oil equivalent (BOE).

That figure does not include potentially recoverable and vast fossil energy resources in oil shale, gas shale and methane hydrates.

Total US fossil fuel resources of 1,321bn are nearly 2.5 times higher than Saudi Arabia’s 534bn BOE and about 2.7 times more than China’s 494bn BOE, according to the research service.

Only Russia comes close to the US, with 1,248bn BOE.

Much of the US advantage in fossil fuel resources is of course due to coal reserves, of which the US has 906bn BOE compared with Russia’s 597bn BOE and China’s 435bn BOE in coal.

Although rich in oil and natural gas reserves, the Saudis have not a single lump of coal.

US coal reserves and resources, according to the report, citing US Geological Survey (USGS) and the Energy Information Administration (EIA) data, totalled as much as 489bn short tons in 2007. 

The nation consumes about 1.2bn short tons of coal annually, largely in electric power generation, which means that the US has a 400-year supply at current consumption rates.

Even if those reserves estimates are subjected to what the EIA calls an availability factor, counting only those coal deposits unhindered by environmental concerns for example, the US still has recoverable coal amounting to 262bn short tons, a 218-year supply.

The total of US fossil energy resources actually may be much higher, because the Congressional Research Service study did not include in US natural gas reserves the fast-developing resources of shale gas.

Shale gas was not included, the CRS said, because “no systematic assessment of shale gas resources has been conducted for the US”.

The report does note, however, that “industry and academic experts estimate that the technically recoverable volumes of natural gas from these shale deposits is very large”.

The CRS cited a recent estimate by the academic Potential Gas Committee that the US has 616,000bn cubic feet (bcf) of potential natural gas resources occurring as shale gas. 

That would be on top of the 1,400,000 bcf of conventional onshore and offshore recoverable natgas resources.

If shale gas is added to US conventional gas resources, together they total slightly more than 2,000,000 bcf, or about an 85-year supply at current annual consumption rates of 23,000 bcf.

Nor did the CRS include potential US fossil energy resources in shale oil, which is second only to coal as the nation’s most abundant fossil energy supply.  Shale oil was not included, said the study, because those fossil fuel resources are limited by major barriers in massive capital investment and the cost of production.

Also excluded from the US fossil energy total was methane hydrates, also known as natural gas hydrates or just gas hydrates.  Methane hydrate is an open, solid lattice of water molecules that encloses, without chemical bonding, molecules of methane. 

Methane hydrates - the object of multiple USGS and Department of Energy (DOE) exploration and production studies - are stable at varying levels of pressure and temperature, even up to 50° Fahrenheit (10° Celsius), although generally they are found at low but not necessarily freezing temperatures. When heated, the hydrate releases its methane, the principal component of natural gas.

Although no one really knows how much fossil energy may reside in methane hydrates, or even if they can be commercially exploited, the CRS study reported that the US is estimated to have 320,000,000 bcf of hydrates in onshore (chiefly Alaska) and offshore deposits.

For the math majors, that is 320 quadrillion cubic feet of potential gas resources.

Inhofe and Senator Lisa Murkowski of Alaska, the ranking Republican on the Senate Energy and Natural Resources Committee, noted that if the US energy industry were allowed to get at the estimated domestic oil resources of 167bn bbl of crude in onshore and offshore reserves, it would replace 75 years worth of US imports of OPEC crude.

Critical of the Obama administration’s focus on alternative and renewable energy resources, Inhofe said that “We should pursue an all-of-the-above strategy that advances new energy technologies but also prioritizes developing the resources we have today”.

“Whether through decree or purposeful inaction, government policies that unnecessarily restrict or prevent our ability to responsible produce these domestic resources are threatening, and could eventually undermine, our nation’s economic and national security,” Inhofe said.

“This report,” Murkowski said of the CRS study, “merely confirms what a lot of us have been saying for years: The US has abundant supplies of natural gas, oil and coal.”

“Any honest conversation about job creation, national security and affordable energy must include these resources, because they will continue to account for the bulk of our supply well into the future,” she added.

Murkowski and Inhofe list a dozen tax and funding decisions, oil and gas leasing withdrawals and blocked coal developments under the Obama administration that they charge are restricting rather than promoting domestic energy production.

“The Interior Department and others in the executive branch have every tool they need to allow production of these energy resources,’ Murkowski said.

“The question is whether the administration is willing to make that happen.”

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By: Joe Kamalick
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