Page 1 of 4

What If We Never Run Out of Oil?

New technology and a little-known energy source suggest that fossil fuels may not be finite. This would be a miracle—and a nightmare.

| Fri May. 3, 2013 3:00 AM PDT

This story first appeared in The Atlantic and is reproduced here as part of the Climate Desk collaboration.

As the great research ship Chikyu left Shimizu in January to mine the explosive ice beneath the Philippine Sea, chances are good that not one of the scientists aboard realized they might be closing the door on Winston Churchill's world. Their lack of knowledge is unsurprising; beyond the ranks of petroleum-industry historians, Churchill's outsize role in the history of energy is insufficiently appreciated.

Winston Leonard Spencer Churchill was appointed First Lord of the Admiralty in 1911. With characteristic vigor and verve, he set about modernizing the Royal Navy, jewel of the empire. The revamped fleet, he proclaimed, should be fueled with oil, rather than coal—a decision that continues to reverberate in the present. Burning a pound of fuel oil produces about twice as much energy as burning a pound of coal. Because of this greater energy density, oil could push ships faster and farther than coal could.

Churchill's proposal led to emphatic dispute. The United Kingdom had lots of coal but next to no oil. At the time, the United States produced almost two-thirds of the world's petroleum; Russia produced another fifth. Both were allies of Great Britain. Nonetheless, Whitehall was uneasy about the prospect of the Navy's falling under the thumb of foreign entities, even if friendly. The solution, Churchill told Parliament in 1913, was for Britons to become "the owners, or at any rate, the controllers at the source of at least a proportion of the supply of natural oil which we require." Spurred by the Admiralty, the U.K. soon bought 51 percent of what is now British Petroleum, which had rights to oil "at the source": Iran (then known as Persia). The concessions' terms were so unpopular in Iran that they helped spark a revolution. London worked to suppress it. Then, to prevent further disruptions, Britain enmeshed itself ever more deeply in the Middle East, working to install new shahs in Iran and carve Iraq out of the collapsing Ottoman Empire.

Advertise on

Churchill fired the starting gun, but all of the Western powers joined the race to control Middle Eastern oil. Britain clawed past France, Germany, and the Netherlands, only to be overtaken by the United States, which secured oil concessions in Turkey, Iraq, Bahrain, Kuwait, and Saudi Arabia. The struggle created a long-lasting intercontinental snarl of need and resentment. Even as oil-consuming nations intervened in the affairs of oil-producing nations, they seethed at their powerlessness; oil producers exacted huge sums from oil consumers but chafed at having to submit to them. Decades of turmoil—oil shocks in 1973 and 1979, failed programs for "energy independence," two wars in Iraq—have left unchanged this fundamental, Churchillian dynamic, a toxic mash of anger and dependence that often seems as basic to global relations as the rotation of the sun.

All of this was called into question by the voyage of the Chikyu ("Earth"), a $540 million Japanese deep-sea drilling vessel that looks like a billionaire's yacht with a 30-story oil derrick screwed into its back. The Chikyu, a floating barrage of superlatives, is the biggest, glitziest, most sophisticated research vessel ever constructed, and surely the only one with a landing pad for a 30-person helicopter. The central derrick houses an enormous floating drill with a six-mile "string" that has let the Chikyu delve deeper beneath the ocean floor than any other ship.

The Chikyu, which first set out in 2005, was initially intended to probe earthquake-generating zones in the planet's mantle, a subject of obvious interest to seismically unstable Japan. Its present undertaking was, if possible, of even greater importance: trying to develop an energy source that could free not just Japan but much of the world from the dependence on Middle Eastern oil that has bedeviled politicians since Churchill's day.

In the 1970s, geologists discovered crystalline natural gas—methane hydrate, in the jargon—beneath the seafloor. Stored mostly in broad, shallow layers on continental margins, methane hydrate exists in immense quantities; by some estimates, it is twice as abundant as all other fossil fuels combined. Despite its plenitude, gas hydrate was long subject to petroleum-industry skepticism. These deposits—water molecules laced into frigid cages that trap "guest molecules" of natural gas—are strikingly unlike conventional energy reserves. Ice you can set on fire! Who could take it seriously? But as petroleum prices soared, undersea-drilling technology improved, and geological surveys accumulated, interest rose around the world. The U.S. Department of Energy has been funding a methane-hydrate research program since 1982.


Nowhere has the interest been more serious than Japan. Unlike Britain and the United States, the Japanese failed to become "the owners, or at any rate, the controllers" of any significant amount of oil. (Not that Tokyo didn't try: it bombed Pearl Harbor mainly to prevent the U.S. from blocking its attempted conquest of the oil-rich Dutch East Indies.) Today, Churchill's nightmare has come true for Japan: it is a military and industrial power almost wholly dependent on foreign energy. It is the world's third-biggest net importer of crude oil, the second-biggest importer of coal, and the biggest importer of liquefied natural gas. Not once has a Japanese politician expressed happiness at this state of affairs.

Japan's methane-hydrate program began in 1995. Its scientists quickly focused on the Nankai Trough, about 200 miles southwest of Tokyo, an undersea earthquake zone where two pieces of the Earth's crust jostle each other. Step by step, year by year, a state-owned enterprise now called the Japan Oil, Gas, and Metals National Corporation (JOGMEC) dug test wells, made measurements, and obtained samples of the hydrate deposits: 130-foot layers of sand and silt, loosely held together by methane-rich ice. The work was careful, slow, orderly, painstakingly analytical—the kind of process that seems intended to snuff out excited newspaper headlines. But it progressed with the same remorselessness that in the 1960s and '70s had transformed offshore oil wells from Waterworld-style exoticisms to mainstays of the world economy.

In January, 18 years after the Japanese program began, the Chikyu left the Port of Shimizu, midway up the main island's eastern coastline, to begin a "production" test—an attempt to harvest usefully large volumes of gas, rather than laboratory samples. Many questions remained to be answered, the project director, Koji Yamamoto, told me before the launch. JOGMEC hadn't figured out the best way to mine hydrate, or how to ship the resultant natural gas to shore. Costs needed to be brought down. "It will not be ready for 10 years," Yamamoto said. "But I believe it will be ready." What would happen then, he allowed, would be "interesting."

Already the petroleum industry has been convulsed by hydraulic fracturing, or "fracking"—a technique for shooting water mixed with sand and chemicals into rock, splitting it open, and releasing previously inaccessible oil, referred to as "tight oil." Still more important, fracking releases natural gas, which, when yielded from shale, is known as shale gas. (Petroleum is a grab-bag term for all nonsolid hydrocarbon resources—oil of various types, natural gas, propane, oil precursors, and so on—that companies draw from beneath the Earth's surface. The stuff that catches fire around stove burners is known by a more precise term, natural gas, referring to methane, a colorless, odorless gas that has the same chemical makeup no matter what the source—ordinary petroleum wells, shale beds, or methane hydrate.) Fracking has been attacked as an environmental menace to underground water supplies, and may eventually be greatly restricted. But it has also unleashed so much petroleum in North America that the International Energy Agency, a Paris-based consortium of energy-consuming nations, predicted in November that by 2035, the United States will become "all but self-sufficient in net terms." If the Chikyu researchers are successful, methane hydrate could have similar effects in Japan. And not just in Japan: China, India, Korea, Taiwan, and Norway are looking to unlock these crystal cages, as are Canada and the United States.

Not everyone thinks JOGMEC will succeed. But methane hydrate is being developed in much the same methodical way that shale gas was developed before it, except by a bigger, more international group of researchers. Shale gas, too, was subject to skepticism wide and loud. The egg on naysayers' faces suggests that it would be foolish to ignore the prospects for methane hydrate—and more foolish still not to consider the potential consequences.

If methane hydrate allows much of the world to switch from oil to gas, the conversion would undermine governments that depend on oil revenues, especially petro-autocracies like Russia, Iran, Venezuela, Iraq, Kuwait, and Saudi Arabia. Unless oil states are exceptionally well run, a gush of petroleum revenues can actually weaken their economies by crowding out other business. Worse, most oil nations are so corrupt that social scientists argue over whether there is an inherent bond—a "resource curse"—between big petroleum deposits and political malfeasance. It seems safe to say that few Americans would be upset if a plunge in demand eliminated these countries' hold over the U.S. economy. But those same people might not relish the global instability—a belt of financial and political turmoil from Venezuela to Turkmenistan—that their collapse could well unleash.

On a broader level still, cheap, plentiful natural gas throws a wrench into efforts to combat climate change. Avoiding the worst effects of climate change, scientists increasingly believe, will require "a complete phase-out of carbon emissions … over 50 years," in the words of one widely touted scientific estimate that appeared in January. A big, necessary step toward that goal is moving away from coal, still the second-most-important energy source worldwide. Natural gas burns so much cleaner than coal that converting power plants from coal to gas—a switch promoted by the deluge of gas from fracking—has already reduced U.S. greenhouse-gas emissions to their lowest levels since Newt Gingrich's heyday.

Yet natural gas isn't that clean; burning it produces carbon dioxide. Researchers view it as a temporary "bridge fuel," something that can power nations while they make the transition away from oil and coal. But if societies do not take advantage of that bridge to enact anti-carbon policies, says Michael Levi, the director of the Program on Energy Security and Climate Change at the Council on Foreign Relations, natural gas could be "a bridge from the coal-fired past to the coal-fired future."

He looked at me like I was an idiot. "They've been drilling here since 1899," he said.

"Methane hydrate could be a new energy revolution," Christopher Knittel, a professor of energy economics at the Massachusetts Institute of Technology, told me. "It could help the world while we reduce greenhouse gases. Or it could undermine the economic rationale for investing in renewable, carbon-free energy around the world"—just as abundant shale gas from fracking has already begun to undermine it in the United States. "The one path is a boon. The other—I've used words like catastrophe." He paused; I thought I detected a sigh. "I wouldn't bet on us making the right decisions."

A few years after I graduated from college, I drove with a friend to Southern California, a place I'd never been. I saw a little of Los Angeles, then went north and spent a few days bumbling through the San Joaquin Valley. Going about Bakersfield one night, I got hopelessly lost and ended up at a chain-link fence. Behind the fence were thousands of oil pumps, nodding up and down like so many giant plastic drinking birds. Enshrouding the pumps was a spiderweb of pipes and electrical wires, vast and complex beyond reason, lights and machinery stretching out across the desert farther than I could see. A giant, hypermodern petroleum operation barely 100 miles from Los Angeles! I couldn't believe it. As I stood gawping, a policeman drove by. I asked him when this complex had sprung up. He looked at me like I was an idiot. "They've been drilling here since 1899," he said.

I was standing by the Kern River oil field, one of the best-known petroleum deposits in the United States. Because I had somehow missed geology in school, I had been left with the vague idea that oil is found in big subterranean pools, like the underground lake where Voldemort conceals part of his soul in the Harry Potter series. In fact, petroleum is usually contained in solid sandstone or limestone strata, which are riddled, spongelike, with minute pores. Or it can occur in thin sheets between layers of shale. Looking at the nodding wells, I had the notion that they were drawing a uniform substance from the ground, a black liquid like the inky water in Voldemort's lake. Instead, petroleum occurs as a crazy stew of different compounds: oil of various grades mixed with methane, ethane, propane, butane, and other hydrocarbons. Squashed into stone hundreds or thousands of feet underground, this jumble of liquid and gas is usually under great pressure. Layers, or "caps," of impermeable rock prevent it from seeping to the surface. When drilling bores through the caps, petroleum shoots up in orthodox gusher fashion.

For a long time, companies collected oil and discarded the methane that burbled up with it, often by burning the gas in a cinematic flare atop special derricks, or even simply dumping it into the atmosphere. People did use natural gas for energy—gaslights have existed since the days of Jane Austen—but transporting it was costly. Unlike liquid oil, which could be poured into containers and carried on a railroad network that had already been built and paid for by somebody else, gaseous methane had to be pumped through sealed tubes to its destination, which required energy firms and utilities to lay thousands upon thousands of miles of pipeline. Not until the Second World War and war-production advances in welding did this effort gather speed. (Methane can be cooled into a liquid and transported in pressurized tanks that are loaded and unloaded in special facilities, but this is also expensive.) Oil from wells in Texas is readily dispatched via tanker to Europe or Asia, but even today, natural gas from the same wells is often effectively limited to use in the United States.

From the beginning, it was evident that the Kern River field was rich with oil, millions upon millions of barrels. (A barrel, the unit of oil measurement, is 42 gallons; depending on the grade, a ton of oil is six to eight barrels.) Wildcatters poured into the area, throwing up derricks, boring wells, and pulling out what they could. In 1949, after 50 years of drilling, analysts estimated that just 47 million barrels remained in reserves—a rounding error in the oil business. Kern River, it seemed, was nearly played out. Instead, oil companies removed 945 million barrels in the next 40 years. In 1989, analysts again estimated Kern reserves: 697 million barrels. By 2009, Kern had produced more than 1.3 billion additional barrels, and reserves were estimated to be almost 600 million barrels.

What does it mean when oil companies say they have so many million barrels in reserves? How much energy is in the ground? When will we begin running out? As the history of the Kern River field suggests, these questions are not easy to answer. Indeed, Ph.D.‑toting experts have bombarded Americans for half a century with totally contradictory responses. On one side, pessimists claim that the planet is slowly running out of petroleum. "Turn down the thermostat!" they cry. "Stuff insulation in your walls!" "Buy a hybrid!" "Conserve!" From the other side come equally loud shouts insisting that there are vast, untapped petroleum deposits in Alaska and Alberta and off the coast of Virginia, that geysers of natural gas exist in the shale beds of Pennsylvania and North Dakota, and that huge oil patches await extraction in the deep ocean. "Drill, baby, drill!" "The end of oil!" Al Gore or Sarah Palin, Cassandra or Pollyanna, which side is right? The back-and-forth would be comical if the stakes didn't involve the fate of human civilization.

When gasoline supplies drop, TV news reporters like to wring their hands at the drivers mobbing the corner Exxon. But the motorists' panic reflects a basic truth: economic growth and energy use have marched in lockstep for generations. Between 1900 and 2000, global energy consumption rose roughly 17-fold, the University of Manitoba environmental scientist Vaclav Smil has calculated, while economic output rose 16-fold—"as close a link as one may find in the unruly realm of economic affairs." Petroleum has wreaked all kinds of social and environmental havoc, but a steady supply of oil and gas remains just as central to the world's economic well-being as it was in Churchill's day. According to the National Bureau of Economic Research, the United States has experienced 11 recessions since the end of the Second World War. All but one were associated with spikes in energy costs—specifically, abrupt jumps in the price of oil.

Understanding this dependence, the oil industry was shaken by a speech in 1956 by M. King Hubbert, a prominent geophysicist at Shell Oil. When a company moves into a field, it grabs the easy, cheap oil first. Tapping the rest gets progressively more difficult and expensive. Eventually, Hubbert observed, conditions get so tough that production levels off—it peaks. After the peak, decline is unstoppable, the fall as ineluctable as the rise. Hubbert used his theory to predict that the crude-oil yield in the continental United States would flatten between 1965 and 1970 (he didn't include Alaska and most offshore oil areas). Coming at a time when estimates by the U.S. Geological Survey and the petroleum industry were constantly rising, this claim was derided; indeed, Hubbert claimed that just before giving his speech, a Shell official tried to get him to back off.

Hubbert, not the least self-confident of men, stood his ground, even after he left Shell and in 1964 went to work for the Geological Survey. Unluckily for him, his most prominent critic was now his boss: Vincent E. McKelvey, a long-serving geologist at USGS who would become its director in 1971. As the University of Iowa historian Tyler Priest has documented, McKelvey's USGS issued a stream of optimistic assessments about the country's oil future. So did its counterparts in the oil industry. Meanwhile, Hubbert cranked out papers taking the opposite stance, none of them published by the Geological Survey. Inevitably, the dispute grew personal. Three days after McKelvey became the USGS director, he took away Hubbert's secretary, a harsh measure in the days before e‑mail. According to Priest, Hubbert ended up having to write all his correspondence in longhand; his wife typed his reports at home. Hubbert struck back by helping to kill McKelvey's nominations to the National Academy of Sciences and the American Academy of Arts and Sciences.

In a blow to McKelvey, Hubbert's prediction proved to be correct. As domestic crude-oil production peaked and then fell, former Interior Secretary Stewart Udall mocked the sunny claims from the Geological Survey as "an enormous energy balloon of inflated promises and boundless optimism [that] had long since lost touch with any mainland reality." If Udall were reappointed Interior secretary, he said, "the first thing I would do would be to kick McKelvey out." In 1977, newly elected President Jimmy Carter, a Hubbertian, forced McKelvey to resign—the first such ouster, Priest notes, "in the Survey's 98-year history."

Hubbert's message of scarcity resonated at a time when the United States was haunted by the specter of Middle Eastern oil blockades. In a nationwide address, President Carter proclaimed that the planet's proven oil reserves could be consumed "by the end of the next decade." To forestall the disaster, he fired a volley of energy-efficiency measures: gas-mileage regulation, home-appliance energy standards, conservation tax credits, subsidies for insulation and weatherization. Congress enacted incentives and restrictions to induce industry to switch from supposedly scarce oil and natural gas to coal, which the U.S. has in abundance.

Alas, petroleum firms found so much crude oil in the 1980s that by the 1990s, prices (after adjusting for inflation) had fallen to one-fifth of what they had been during the Carter administration. Estimates of reserves rose and rose again. Energy conservation faltered; oil and gas were too cheap to be worth saving.

"When will the world's supply of oil be exhausted?" asked the MIT economist Morris Adelman, perhaps the most important exponent of this view. "The best one-word answer: never."

The argument has nonetheless continued, pessimists and optimists hammering at each other like Montagues and Capulets. Most of the Hubbertians are physical scientists; most of the McKelveyans, social scientists. Central to the conflict is their differing concepts of a reserve. Recall, as an example, the Kern River field. Its thousands of nodding pumps are siphoning up oil so thick and heavy that it almost doesn't float on water. Although drillers knew from the first that the field was abundant, they could barely wrest any of this goop from the ground, a factor reflected in the first estimate of the reserve (47 million barrels of recoverable oil). Between that estimate and the second (697 million barrels), engineers developed a precursor to fracking: shooting hot steam down Kern River wells to thin the oil and force it out of the stone. At first, the process was hideously inefficient: heating the water to produce the steam required as much as 40 percent of the oil that came out of the wells. Burning unrefined crude oil released torrents of pollution: nitrous oxide, sulfur dioxide, carbon dioxide. But it squeezed out petroleum that had seemed impossible to reach.

At the same time, the industry learned how to burrow farther into the Earth, opening up previously inaccessible deposits. In 1998, an oil rig near the Kern River field drilled thousands of feet deeper than any previous attempt in the area. At 17,657 feet, the well blew out in a classic gusher. Flames shot 300 feet in the air. The blast destroyed the well and everything else on the site. Even after the fire burned out, petroleum flooded from the hole for another six months. Energy firms guessed that the blowout hinted at the presence of big new oil-and-gas deposits. Earlier assessments had missed them because of their great depth. Investors rushed in and began to drill.

To McKelveyan social scientists, such stories demonstrate that oil reserves should not be thought of as physical entities. Rather, they are economic judgments: how much petroleum experts believe can be harvested from given areas at an affordable price. Even as companies drain off the easy oil, innovation keeps pushing down the cost of getting the rest. From this vantage, the race between declining oil and advancing technology determines the size of a reserve—not the number of hydrocarbon molecules in the ground. Companies that scrambled to follow the Kern River gusher found millions of barrels of deep oil, but it was mixed with so much water that they couldn't stop the wells from flooding. Within a few years, almost all the new rigs ceased operation. The reserve vanished, but the oil remained.

This perspective has a corollary: natural resources cannot be used up. If one deposit gets too expensive to drill, social scientists (most of them economists) say, people will either find cheaper deposits or shift to a different energy source altogether. Because the costliest stuff is left in the ground, there will always be petroleum to mine later. "When will the world's supply of oil be exhausted?" asked the MIT economist Morris Adelman, perhaps the most important exponent of this view. "The best one-word answer: never." Effectively, energy supplies are infinite.

Sweeping claims like these make Jean Laherrère's teeth hurt. Laherrère spent 37 years exploring for oil and gas for the French petroleum company Total before co-founding the Association for the Study of Peak Oil and Gas. ASPO was born after Laherrère and Colin Campbell, another retired petroleum geologist, predicted in 1998 that "within the next decade, the supply of conventional oil will be unable to keep up with demand." Given the record-high petroleum reserves of the time, the claim was gutsy. Campbell and Laherrère insisted that talk of ever more oil was nonsense. In the 1980s, the Organization of the Petroleum Exporting Countries, the intergovernmental cartel that controls most crude oil, discussed allocating sales on the basis of member states' reserves: the bigger a nation's reserves, the more oil OPEC would let that nation sell. In such a system, countries would have every incentive to overstate their holdings. As Campbell and Laherrère noted, six of the 11 OPEC members abruptly hiked their reserve estimates during these discussions. Incredibly, some nations more than doubled their estimates, without a word of explanation for why they now had so much more oil in the ground. (OPEC eventually decided not to allocate oil in this way.) The supposed glut was a charade, Laherrère told me when we spoke in February. The reserves didn't exist. "We said the [plateau in oil production]would begin before 2010, and we were correct."

Far from being infinite, Laherrère said, petroleum supplies are finite by definition. The Earth contains only so many hydrocarbon molecules that can be extracted by human effort. "Once we have used up the easy oil, new types of cheap energy will not appear by magic. We will keep drilling for oil, and it will not be easy to get. Look at the enormously expensive equipment they use now only to keep up production."

Page 1 of 4

Get Mother Jones by Email - Free. Like what you're reading? Get the best of MoJo three times a week.