Salient Facts

This got sent to me in the email today. Some facts about Canada's energy relationship with the US, but this jumped right out at me:

As of January 1, 2005 Canada's proved reserves were approximately 179 billion barrels -- 4.3 billion barrels of conventional oil and 174.5 billion barrels from Alberta's oil sands reserves -- and rank second only to those of Saudi Arabia.

Note that our government is explicitly endorsing the fiction that oil sands are equivalent to conventional crude - which is true only if you think chunk tuna is equivalent to caviar.

Note also the tiny fraction of our "oil" that is actually, you know, oil. Canada - as an entire country - contains less oil than the top 20 individual oil fields, much less oil exporting countries.

I've gone over, and over, and over the problems with tar sands, so I hope people won't fall asleep when I say this again: Tar sands won't solve the problem of oil shortages - not for the US, and not for the world. They could supply Canada with all the oil we need today, but that's only because our demand is puny.

Tar sands are too dirty, expensive, and use precious and dwindling natural gas supplies to make in to useable oil. On that note, this rather frightening article from the NYT:

Thanks to a huge buildup of natural-gas-fired electricity plants in the 1990's even as exploration has slowed, demand has outstripped supply; the nation now depends on natural gas for 24 percent of its energy requirements, compared with 23 percent for coal and 40 percent for oil...

In the meantime, higher prices for the fuel are rippling through the economy. And with more than half of the nation's homes heated by natural gas, millions of Americans are already bracing for big price increases this winter. The Energy Information Administration recently predicted that the cost of heating a typical home with natural gas could rise by more than 40 percent in coming months, or an average of $306 a household...

The prices have been pulling back from a post-hurricane spike in October that sent them above $14 per thousand cubic feet, but they remain at unusually high levels, with the futures contract for December closing at $11.61 on Monday. Only three years ago, during a glut, natural gas was selling for as little as $2 per thousand cubic feet.

High prices are inflicting pain across the country, hitting hard at utilities in the mountain states, grain elevators in the Midwest and chemical manufacturers along the Gulf Coast. Announcements of job losses in energy-intensive industries are mounting.

For instance, Lyondell Chemical of Houston said last month that it was shutting a foam chemicals plant in Lake Charles, La., cutting about 280 jobs. The reason was higher energy costs, the company said, though Lyondell also cited damage from Hurricane Rita...

"We need to declare a national crisis," Andrew N. Liveris, the chief executive of the Dow Chemical Company, said in recent testimony before the Senate. Dow, the nation's largest chemical maker, has shut 23 plants in the United States in the last three years in places like Somerset, N.J.; South Charleston, W.Va.; and Elizabethtown, Ky., as it shifted production to Kuwait, Argentina, Malaysia and Germany, where natural gas is cheaper.

"Call it demand destruction," Mr. Liveris said. "Dozens of plants around the country have closed their doors and gone away, and are never coming back."

Then the article ignores reality:

The current supply shortage results mainly from production disruptions in the Gulf of Mexico, where nearly 40 percent of output remains shut. But it has also revealed two disturbing trends: disappointing production elsewhere in the United States and an inadequate imports via pipeline from Canada.

Sure, these are temporary problems, but the long-term outlook is just as bleak - North American natural gas production is in decline. Period. Full stop. Later in the article, they mention that importing liquid natural gas from overseas is one option, but there are currently only 5 LNG terminals in North America.

The tight natural gas supply is a huge problem for North America this winter.