Tuesday, November 13, 2012

Oil Shale: Finally a Bride?

The past few years has seen an explosion in the production of shale gas. The recently released World Energy Outlook 2012 predicts that the US will replace Saudi Arabia as the world's largest producer of oil by 2020 as a result of a dramatic increase in production from an unconventional source: shale oil.

How plausible is this? Lets begin with the facts. First, there is a tremendous amount of oil locked up in US shale, particularly in Colorado. With 'known' reserves of approximately 600 billion barrels of oil equivalent and estimated potential of 1.8 trillion bbl, this resource is the American version of Canada's oil sands -- an unconventional source of petroleum that has a long history of being a bridesmaid, but never a bride. A popular saying in the Colorado industry captures this nicely: “Oil shale is the fuel of the future, and always will be.” But, as the tar sands have shown, changes in the economics of the industry coupled with technological developments can foster large scale production from previously inaccessible sources.

Second, the projection is based on expectations about both price and technology. Significantly, a recent survey of petroleum economists showed little consensus about future prices. The survey revealed two distinct camps -- those who think prices will remain high or increase and those who think they will fall substantially. Their take on prices is largely tied to their expectations about the impact of shale oil on the global market. One camp argues that the upside from shale oil supplies will be more than enough to meet demand growth. The other disputes that, saying the likely impact from shale is being exaggerated.

The role of technology is equally contentious. Some geologists point to the role of two technologies that have been central to the development of shale gas: hydraulic fracturing and horizontal drilling. Others emphasize the technologies present at Shell's Mahogany Ridge Project; a new, working, but small scale, oil shale demonstration technology that produced 1400 barrels of oil without mining. The traditional approach to oil shale -- which led to the bridesmaid label -- involved 'retorting,' a process that required mining the shale, hauling it to a processing facility that crushed the rock into small chunks, then extracted a petroleum substance called kerogen, then upgraded the kerogen through a process of hydrogenation (which requires lots of water) and refined it into gasoline or jet fuel. Here is a description of the Mahogany Ridge process from Shell's Terry O'Connor:
“Most of the petroleum products we consume today are derived from conventional oil fields that produce oil and gas that have been naturally matured in the subsurface by being subjected to heat and pressure over very long periods of time. In general terms, the In-situ Conversion Process (ICP) accelerates this natural process of oil and gas maturation by literally tens of millions of years. This is accomplished by slow sub-surface heating of petroleum source rock containing kerogen, the precursor to oil and gas. This acceleration of natural processes is achieved by drilling holes into the resource, inserting electric resistance heaters into those heater holes and heating the subsurface to around 650-700F, over a 3 to 4 year period.

“During this time, very dense oil and gas is expelled from the kerogen and undergoes a series of changes. These changes include the shearing of lighter components from the dense carbon compounds, concentration of available hydrogen into these lighter compounds, and changing of phase of those lighter, more hydrogen rich compounds from liquid to gas. In gaseous phase, these lighter fractions are now far more mobile and can move in the subsurface through existing or induced fractures to conventional producing wells from which they are brought to the surface. The process results in the production of about 65 to 70% of the original “carbon” in place in the subsurface.

“The ICP process is clearly energy-intensive, as its driving force is the injection of heat into the subsurface. However, for each unit of energy used to generate power to provide heat for the ICP process, when calculated on a life cycle basis, about 3.5 units of energy are produced and treated for sales to the consumer market. This energy efficiency compares favorably with many conventional heavy oil fields that for decades have used steam injection to help coax more oil out of the reservoir. The produced hydrocarbon mix is very different from traditional crude oils. It is much lighter and contains almost no heavy ends.

“However, because the ICP process occurs below ground, special care must be taken to keep the products of the process from escaping into groundwater flows. Shell has adapted a long recognized and established mining and construction ice wall technology to isolate the active ICP area and thus accomplish these objectives and to safe guard the environment. For years, freezing of groundwater to form a subsurface ice barrier has been used to isolate areas being tunneled and to reduce natural water flows into mines. Shell has successfully tested the freezing technology and determined that the development of a freeze wall prevents the loss of contaminants from the heated zone.”

It may seem, as O’Conner said, counter-intuitive to freeze the water around a shale deposit, and then heat up the contents within the deposit. It’s energy-intensive. And it’s a lot of work. What’s more, there’s no proof yet it can work on a commercial scale.

Yet both technologies, the freeze wall and the heating of shale, have been proven in the field to work. The freeze wall was used most recently in Boston’s Big Dig project. It was also used to prevent ground water from seeping into the salt caverns at the Strategic Petroleum reserve in Weeks Island, LA.
In short, the individual 'pieces' of a working approach have been demonstrated, but their viability as a systemic whole, particularly on a commercial scale, remain unproven.

Third, a number of other factors have to be taken into account. The energy content of oil shale varies tremendously from region to region. Colorado shale is, by far, the most concentrated and, hence, most attractive. But, the process is both energy and water intensive, and water is at a premium in Colorado. Moreover, 72% of known US oil shale reserves are on government land. This is a fact that cuts both ways. On the one hand, this provides an economic lure; development of the lands could provide a significant revenue stream. On the other, as the case of drilling in the Alaska National Wildlife Refuge shows, exploitation of sensitive government lands can be a political hot potato. The Colorado reserves lie on land surrounded by National Parks and other sensitive areas. So, simply put, in addition to the economic and technology matters, there are also significant political considerations.

Finally, as my earlier research on the history of oil estimates showed, the current political economy of the oil industry accounts for the way assumptions underlying such projections are interpreted. In other words, while the projections are justified in terms of geology and technology, it is the current political economy of the industry which affects whether such estimates incorporate 'optimistic' or 'pessimistic' assumptions about the implications of those factors.  Simply put, when there is lots of shut in short term capacity, the industry thinks that there is lots of energy available and opts for optimistic assumptions about future geology and technology. Alternatively, when demand outstrips supply, there is no shut in capacity, and the industry is doing everything it can to find new sources and get them on to the market, then pessimistic assumptions about future geology and technology become the order of the day. Thus, given the current glut of supply on the market, history suggests we would be wise to question the ultimate validity of these particular projections.

Harvey: Zero Growth and Novelty

Harvey says that past communist systems failed because they did not provide "the liberty to pursue novelty" and promote human development. My take: adapting to climate change, resource constraints and economic degrowth (whether planned or forced) will require constant innovation, and all our creative problem solving capacity, just to keep up with the constantly shifting environment.

Saturday, November 10, 2012

Transition Towns: Possibilities, not Probabilities

The following blog post from Rob Hopkins is by far the best explanation of what Transition Towns is about. It contains numerous but implicit references to chaos theory: that we have to self-organize, start from the simplest level, from the ground up, that we don't know the mature state of the system or even where we're going, but that by following simple 'nearest neighbor' rules, we can create resilient communities and perhaps arrive at a mature system state that is resilient and more ecologically sound than the current one.

After reading this, my 'aha' moment was that I realized that there's no way we can solve the problem of global climate change—it's impossible. It's too big, it's too complex and too intractable. Since we can't solve the problem of global climate change (or 'peak oil') we have to focus on problems that we can solve. "Focus on possibilities, not probabilities." We have the capacity to build local, resilient communities that can survive whatever hits us, whether climate change, peak oil, economic collapse, or the decline of an empire. But just working on any collective social problem won't help us develop the right skills for the crisis. In order to develop the necessary skills to survive climate change, we have to work on problems and projects that "model" the larger crisis. So working on the cooperative local provision of food, shelter, energy and governance in a low carbon mode, creating systems that can react quickly and flexibly to localized change, helps us develop capacities for a future that is energy scarce and climate disrupted. We can solve those problems by working through movements like Transition Towns that ask the right questions and focus on the right issues, even if they don't have all the answers. "Resilience" doesn't solve the problem of climate change either—it just helps us to survive it so that we can adapt to whatever conditions will be thrust upon us for the indefinite future. In the face of these insurmountable dilemmas, we cannot avoid collapse, large or small. Catastrophic transformation is on it's way and we can't stop it. All we can do is survive it and hope that the new communities we create will evolve into a system that is adapted to the new world that awaits us.

From today’s Guardian Sustainable Business section: ‘Community action alleviates climate change gloom’

In his recent piece on climate change on the network, Jo Confino wrote of the dark place he found himself in after a few weeks immersed in the latest news on sustainability – his climate change ”dark night of the soul” if you like.  For the past six years I have been part of an experiment known as Transition, which encourages people to do just what Confino suggests: to sit with the pain of this awareness, while also pointing to a path beyond it.
It’s a bottom-up approach to the creation of community resilience; the ability to withstand shocks at the local level. It focuses on “engaged optimism”, a solutions-focused and positive response, rather than the “false cheer” Confino warns against.
There is an important distinction to be made between the kind of positive thinking that Barbara Ehrenreich lambasts in Smile or Die: How Positive Thinking Fooled America and the World, and the Transition approach. Ehrenreich writes of “mandatory optimism and cheerfulness”, whereas Transition is very different. It acknowledges the scale of the challenges we face and that they can be deeply upsetting, but also invites you to be part of a collective response, with no predetermined answers, to help make history figuring it out. A collective experiment, if you like.
It works like this: an initiating group forms; raises awareness about climate change, peak oil and so on (always in the context of what can we, now, here, do about it); then subsequent groups form around key areas – food, energy, transport – which enable the people who are passionate about those areas to get involved. It works to create a collective vision of how it would like its future to be in the context of the challenges outlined above. This then leads to practical projects driven by what people feel enthused to do. You might think of it as a “do-ocracy”, a process driven by the people who are doing stuff.
It is open source, bottom-up and self-organised. It represents a shift from focusing on probabilities to focusing on possibilities. Confino’s despondency following his immersion in the data on climate change is about probabilities, the probability that such-and-such will happen by a certain time. But what if the thinking shifted to what was possible? Given that we are where we are, what might we be able to create in this situation?
It is that refocusing that led to the creation of Bath & West Community Energy, a co-operative, community-owned energy company which just raised £750,000 in its first share launch. It led to the Bristol Pound, launched last month with the full support of the city council and already accepted in many hundreds of businesses, and Transition Lancaster’sFruity Corners, fruit trees planted across the city. . There are many other examples of such initiatives.
While none of these on their own are an adequate response to climate change, combined they represent communities taking visionary leadership when their leaders are failing to do so.
Might we redefine resilience as the degree to which we can breathe possibility into our local communities, changing the stories they tell about themselves, so that when they encounter shock, they are able to refocus on the possibilities that emerge? The realisation that we live in a world of limits can be a great stimulus for new thinking and creativity.
I too have sat in the pit Confino writes about, the gloomy place where it feels like you are the only person who can see the wall our juggernaut of civilisation is heading for at great speed. Indeed, I pop back there on a fairly regular basis. But feeling part of a process, with others, of starting to build the kind of world we want to see, helps hugely. It contributes to my own personal resilience, as well as to the resilience of the community around me.
It is perhaps a path out of the pit driven by action.
Rob Hopkins is co-founder of Transition Network and author of The Transition Companion. He blogs at TransitionCulture.org and tweets as@robintransition.  You can find the original of this piece here.