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Gold/Mining/Energy : Peak Oil - Not If but When
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From: veritas50112/3/2009 6:41:30 PM
of 129
 
When we speak of Peak Oil, we are speaking of the peaking of the production of Conventional Oil, the oil we have been consuming since the beginning of the oil age. But what about Unconventional Oil? Is the Net Energy of Unconventional Oil so poor that it is not a suitable replacement for Conventional Oil?

The answer to this question again goes back to scale as it did with bio-fuels. On a limited basis, Unconventional Oil is a workable substitute for Conventional Oil. But on the scale of the consumption of Conventional Oil -- 85 million barrels a day -- it is not. Not only is the Net Energy of Unconventional Oil far less than Conventional Oil, and therefore much more expensive to produce, but the production of Unconventional Oil is much more demanding on the environment than Conventional Oil. For example, the Canadian Oil Sands require huge amounts of water to extract oil from the sand that is mined. This water after being used is toxic and cannot be released back into its original source. Oil Shale, which is mostly located in Colorado and Utah, would also require vast quantities of water to process. This is a region that has limited water supplies and cannot afford profligate water use.

So Unconventional Oil is not a workable alternative to Conventional Oil. It can in limited quantities help to supply the oil market, but not much else.

As we can see, Conventional Oil is much more valuable than we ever imagined.
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