I keep thinking about the cargo cult and muslim extremism, because that is the limited level of intelligence we are dealing with most of them. The Muslims will ultimately pay a terrible price for Muslim extremism as the West desperately searches for alternatives to crude oil. Was Islamic terrorism the single greatest factor to spur innovation in oil technology? Not really, it was probably the development of syncrude from Canadian oil sands. As we reflect on history to determine the availability of trapped hydrocarbons, the world is going to make sure that crude oil is only an overall part of the supply function for transportation fuels - gasoline, diesel, jet fuel, etc... Today, Canada is the biggest importer of oil in the US. Canada, Mexico, Venezuela, and Saudi Arabia are now the top four exporters in the US, in order of size.
The biggest source of syncrude is Canadian oil sands. Chevron and other companies are also looking at oil shale as potential replacements to crude oil. Big time coal companies are exploring coal to liquid technology to back up crude reserves too. The cost structure of syncrude is very high. We need a sufficiently high price of crude to develop syncrude. Here are a few of the problems with alternative fuel.
Hydrogen engines require 40 gallon tanks that only get 6 mpg. It takes 300 billion gallons of water to run a liquid hydrogen refinery. People will have to fill their hydrogen tanks twice a week.
Oil shale has to be heated to make syncrude. Heating oil shale to 450 degress C is going to be incredibly expensive, not to mention all the water required.
The most feasible replacement to crude oil for transportation fluids will be coal to liquid conversion. Companies like rtk are exploring ctl technologies with Peabody and Arch right now. The Japs and Germans used transportation fuel from ctl in WW2. The air force says they want 70% of their jet fuel from ctl technology by 2025. Major airlines could also follow suit.
In any case, it will take years to develop any refineries to add barrels of syncrude from oil shale or coal to liquid sources. During history, everyone has made efforts to use all of these alternative forms of energy. However, now that geopolitical risk is being taken from the energy market, oil shale, coal to liquid, diesel, hybrids are stretching hopes a little bit that we can develop an energy policy that is not so dependent on OPEC. |
