Gulf Oil Spill 2010: Drilling for Dollars, Not Oil

by Ken Kneidel, PhD

We’re discovering a lot of money, not a lot of oil
The oil under the Gulf is not being extracted to extend our ability to live in an oil-driven economy, nor to provide energy independence from the Middle East. BP is drilling in the Gulf solely because the corporation can make a lot of money in doing so. In terms of the world’s supply, the volume of oil in BP’s spewing oil field in the Gulf of Mexico is a piddling amount, roughly 3 billion barrels. That might seem like a lot, but currently the world is using 31 billion barrels of oil per year. Dividing 31 by 3 tells us that at our current rate of usage, the oil in this particular oil pocket could supply the world for just of a year…35 days. When converted to dollars, however, this small volume of oil becomes an enormous pile of change for BP. With crude oil currently selling at $70 a barrel, the value of the field (if all were extracted) would be $210 billion dollars. Simply put, this oil is being drilled for monetary profit; all other rationales lag far behind.

Our oil reserves are waning
Secondly, the fact that BP is drilling in such a hard-to-access location tells us that the supply of oil on this planet is running dangerously low. We’ve already depleted all the easy-to-reach pockets of oil. BP’s well lies under one mile of ocean and 30,000 feet of the Earth’s crust. The list of other recent “major” discoveries is similar – trivial amounts in difficult places. Chevron announced in 2006 the discovery of a similar field in the Gulf (3 to 15 billion barrels, six miles under the ocean surface – a 35 to 177 day world supply). The “new” oil fields under melting Arctic ice have been estimated to contain roughly 90 billion barrels (a 2.9 year world supply). According to the website www.worldometers.info, we have 15,536 days until we run out of oil, consuming at our current rate. That’s 42.6 years. James Howard Kunstler, in this book, The Long Emergency, calculates a 37-year supply. I’ve found internet sites with dates all over the place; the U.S. Department of Energy gives an estimate of 100 years. But for those who latch on to the 100-year date as a means for supporting lack of concern, remember that these estimates are based on current world usage rates. With development in India and China increasing (the two are selling 1.2 million new cars per month), all of the dates could shrink significantly. Also, don’t forget to factor in population growth, which many omit in their calculations. How do we cut the absolute amount of oil that we consume with the world’s population of 6.8 billion projected to swell to 9 billion in 50 years? In addition, it’s not just oil that’s in short supply According to the US Geological Survey, our reserves of lead, tin, copper, iron, and bauxite are projected to last 17, 19, 25, 54, and 68 years respectively.

 Future environmental catastrophes 

are certain

If we are unwilling to curb our energy usage (the total consumption has held steady over the past 10 years), environmental disasters like this will occur again. We can blame the spill on lack of oversight or short-cuts in safety technology. And maybe the US will enact changes to make drilling safer in years down the road, but look at other locations on Earth. In a recent NY Times editorial, Lisa Margonelli stated that a coastal spill as large as that of Exxon-Valdez has occurred every year since 1969 in environmentally-lax Nigeria, which supplies the US 10% of its oil.Will action be taken by the corporate world, or the government of Nigeria, to put an end to these environmental disasters? Do Americans care about ecosystems off the coast of Nigeria? The non-human organisms on our planet interact without regard to political boundaries. In our desperation, we continue to look at the oil fields in the Arctic National Wildlife Refuge. Its 10 billion barrels offers the world a 118 day supply, and for the US just 1.3 years at our current usage rate of 7.6 million barrels a year. How long before we drill that too?

The consequences are severe for everyone
We are destined to suffer dramatically from dragging our feet in weaning ourselves from dependence on oil. I’m reminded of the story where the farmer, when setting out to town by riding his donkey, begins by belting the donkey on the head with a two-by-four. When asked by a bystander why he hit the donkey so brutally before even starting his journey, he replied “Well, first I have to get his attention!” This Gulf oil spill is a similar wake-up call. It’s urgent that we come to our senses and address larger issues that lie ahead over the next 100 years. Just consider the economic and social implications of running out of oil as our primary energy supply. Without jet fuel, what would happen if air transport came to a halt in just a few decades? Can anyone envision an airplane fueled by solar power, a fuel-cell, a windmill, or natural gas? What about our diesel-powered rail and trucking systems? How can we collect and distribute the food we grow on huge corporate farms, or the cotton we grow, or the polyester we manufacture for clothing? How will we get people to work without gasoline? How will we build the windmills or the solar power cells without the plastics produced from oil? How will we support the 2.5 billion people worldwide who live in cities? Over 3.4 billion people live within 120 miles of coastlines. If sea levels rise just a meter, there will be refugees from cities well beyond New Orleans. Add Miami, New York, Tokyo, Mumbai, Shanghai, and Jakarta for a start.

Why “crying wolf” is the right thing to do

I’m afraid that by now many readers are steaming, some writing this off as insane left-wing liberal tree-hugging alarmism. But the BP oil spill is a wake-up call that we all must take seriously. In his book Collapse, Jared Diamond addresses the wisdom of being conservative when setting criteria for raising environmental alarm. Let me borrow from him and illustrate with the smoke alarm in my kitchen. I note, often with irritation, that it sometimes goes off with the slightest hint of fire – a piece of over-cooked toast will get it wailing, sometimes just turning on a cook-top burner that has an oily smudge on it will trigger the alarm. The piercing whistle is annoying when it goes off, but after I settle down and realize that all is well, my rational self notes that I want my smoke alarm to work that way. If the alarm goes off when my house is already on fire, it would do me no good, my loved ones and valuable possessions could be gone. Similarly, we need to put our environmental warning systems on a low setting. We can turn our backs on the BP oil spill and write it off as a mistake in technology. But I implore you to look at the big picture. Ignoring warnings like this carries us ever closer to the point where our wake-up call will come too late. We’ve been hit between the eyes with a two-by-four. Time to stop the arguing and denial, and take serious steps toward preparing for the inevitable day when the oil is gone. We need to take what oil’s left and direct it towards supporting a massive investment in the manufacture and research of sustainable energy sources. The enormity of what’s at stake demands our immediate attention.

Key words: BP oil spill remaining oil James Howard Kunstler The Long Emergency Jared Diamond Collapse how much oil is left Lisa Margonelli