Energy Independence Will Not Happen Because Of Oil

By Brent

This year, oil prices and energy has come back into the national conversation between the two parties. We hear the back and forth arguments between the two major parties and each of their incriminations.

Well, let's look at the arguments that are going on out in the public right now.

Let's look at the amount of consumption that the United States uses in oil each and every day. 20,730,000 Barrels of Oil per day. That is the number to get to in order to not have any imported oil in the United States. It is also fact that the United States imports 10,400,000 Barrels of Oil per Day.

The United States has a oil refining capacity of 16,800,000 Barrels of Oil per day. So already, we can see that there needs to be more refining capacity in place. We also can see already that we need more domestic supply of oil here in the United States. So let's look at the supply of United States oil first.

Let's put the amount of oil recoverable from the Arctic Wildlife Refuge at 50 Billion Barrels. Nice hefty sum there. That amount of 50 Billion Barrels has a 5% chance of occuring according to our government. 30 Billion Barrels has a 50/50 chance. But let's do the best case scenario, 50 Billion. Right now, we need 7.6 Billion Barrels of Oil per year to meet demand in the United States. So the arctic gives us just over 6 years of oil to meet today's demand.

The estimate of the amount of oil in the United States continental shelf is 115.3 Billion barrels of oil at the most generous estimate. So, let's use that as our best case scenario. That gives us 15 years of oil supply. Add that to the 6 years of oil from ANWAR, and we have 21 years of oil for domestic consumption.

The Bakken Play estimated at 100 Billion Barrels of oil in North Dakota and Montana. Let's put the other amounts of oil from around the country that we can get to at 300 Billion Barrels. That is 400 Billion Barrels of oil that we have not extracted from the continental US. That is 52.6 years in oil. That is the best case scenario. So according to the estimates that I have used, we have 73 years of oil left here in the United States to go through and then we are down to a trickle of domestic supply. Seems like plenty of oil left for us to produce and get through the energy crunch, right? Not really. Let's look at the realistic view.

Approximately 40% of the oil in an oil well is never recovered, history has shown us. That is due to a myriad of reasons, but that is the average. 60% of 73 years is 44 years. Let's add 20% of that oil back into the supplies because of technology advances. That gives us 59 years of domestic oil production. Let's also remember that the average oil use goes up each and every year. We will take off 3 years for that and we are now at 56 years of domestic oil left. Let's also remember that oil usage goes up during international conflicts. I'm sure that will happen again within my lifetime, so let's eliminate 1 year of domestic production for that. That gives us 55 years of domestic oil production left.

If you look at the supply of domestic oil, then you can see that we need more domestic refineries to deal with the increase in oil that we are producing above. In order to double our capacity to meet our demand, we would have to clone the 132 refineries that are working right now. That cannot happen overnight. Let's give the US 5 new refineries every year. I am optimistic. That means 26 years would pass if that was the rate that we are building refineries to get to our 132 new refineries. And we know that building that many refineries is not going to happen. So, we know that we are going to be dependent on foreign countries to at least refine the oil.

So what have we learned here. That the domestic oil production could be increased by more drilling. That fact should not surprise anyone. That our refining capacity to hold the increase of domestic oil production will not rise at the same rate means that we must continue to rely on foreign countries for oil. Energy independence for the United States is not possible until oil is not the primary means of energy for transportation. Ethanol is not the answer because of the amount of energy it requires. Hydrogen could be a possibility, but there is lots of work that need to be done for that to become possible. Solar and wind power don't factor in here. Neither does coal or nuclear. This is not a short-term problem. This is a problem that needs a long-term energy policy and the either/or policies that both major political parties are suggesting are nothing but a bunch of hot air.