The Oil and the Glory
The end of scarcity (for now), and the crisis for clean energy
To understand why companies wish to drill off the U.S. eastern seaboard, you need only make a beeline 5,000 miles southeast — straight to Jubilee, an oilfield off the shore of the west African nation of Ghana. Because there are an estimated 1.5 billion barrels of oil in Jubilee, the reckoning goes, there just might ...
To understand why companies wish to drill off the U.S. eastern seaboard, you need only make a beeline 5,000 miles southeast — straight to Jubilee, an oilfield off the shore of the west African nation of Ghana. Because there are an estimated 1.5 billion barrels of oil in Jubilee, the reckoning goes, there just might be oil off the coast of Virginia. The reason is ancient geology — Africa and the Americas were once one gigantic continent, and geologists have already found analogues to Jubilee across the Atlantic in French Guinea, as I write on EnergyWire.
These similarities are interesting not just for their curiosity value, but because they are part of a stark transformation in how experts perceive global energy, and trends in geopolitical power: Less than a year ago, the conventional narrative was scarcity — Big Oil simply could not find any more super-giant oilfields, and were left trifling with comparative puddles. Hence, the world needed to develop alternative energy, and fast. Now, barely a week goes by without a fresh discovery in Africa, and a new expert report on the new U.S. oil bonanza; we are told we have oil and gas as far as the eye can see, limited only by the skilled labor, pricing points and equipment to produce it (pictured above, pipeline awaiting installation in Cushing, Oklahoma.).
In a significant way, that is good news — to the degree it is accurate, we are not imminently returning to the Stone Age, as a new-age movement known as the Doomers have forecast.
But it is a highly challenging development for those concerned about the Earth’s warming trend: They are stripped of one of the primary underpinnings of their argument for rapid development of solar, wind and electric cars — that oil is running out, and that the West is too reliant on supplies from nefarious nations. As it appears, much of the new oil will be produced by quite normal nations, such as Canada and the United States.
In terms of oil-led geopolitics, some thinkers see a gravitational shift that leaves a balance between the Middle East and the Western Hemisphere. This is because of oil production projections from fields currently being explored. "Our projections are about 5 million barrels [of oil] a day out of the very interesting tight liquids play out of North America," said Bob Fryklund, who watches Latin America for IHS CERA, the oil industry consultant firm. In addition, Fryklund told me,
you could have almost 5 million barrels a day coming out of Brazil. So including North and South America, you are looking at 10 million barrels a day. That is a major shift back to this hemisphere from the east, Africa and the Middle East.
But where does this leave climate scientists, global warming activists, alternative energy entrepreneurs, and clean-energy public policy? It could force a fresh discipline on them: If the projections are accurate, there will be a shakeout of both policy and companies.
Look for the survivors to pivot thematically away from energy independence, since oil seems likely to take care of that. Instead, there will be more attention to the economics of clean-tech, and a laser-like focus on the upside of things clean, and the argument for moderating the trend of a warming planet.