The Potential Gas Committee has issued its new biennial gas resource estimate for the United States and once again raised its estimate, this time by 15%, or from 1,321 trillion cubic feet (Tcf) to 1,525 Tcf. This equates to a 70-year domestic cushion, given annual U.S. consumption of 20 Tcf. The evaluation of available shale gas, production of which is now soaring, played a major role in this re-evaluation and potently demonstrates how new technology (aka human ingenuity, what the late Julian Simon called the ultimate resource) creates resources, refuting the static fixity/depletion view of the mineral-resource world.
Few realize that the PGC has been raising the estimates of conventional resources throughout history, even as the United States has consumed large amounts of natural gas. Thus gas has been and is an expanding resource, not a depleting one.…
[Editor note: the current debate over climate policy has obscured another important energy-policy controversy: the notion that the production of hydrocarbons (even coal) has, or will soon, reach a physical peak. This post, like the author’s previous ones on this subject, shed light on the fallacious concept (from a business/economic viewpoint) that mineral supply is fixed and thus depleting.]
The recent death of Patrick McGoohan brings to mind one of the best lessons offered by television, and one ignored by all too many analysts (including academic economists). In an episode of his cult-classic series The Prisoner, McGoohan is confronted with a unique teaching system, wherein “The General” pumps information into villagers while they sleep. The General proves to be a ‘supercomputer’ (presumably less capable than desktops now available) containing all known information.…
In hearings recently held by the House Science and Technology Committee, new Secretary of Energy Dr. Steven Chu remarked that energy- intensive companies were seeking to save energy because it could result in large savings (so what’s new?). But then the DOE head said, “the more forward looking companies … see in the long term energy costs just increasing because in the long term, as noted before, oil, natural gas production will eventually peak and decline, plateau and decline” (emphasis added). [Note: this is a paraphrase from the recording, at about 1:32.]
Apparently, Secretary Chu has taken to heart the arguments of the Hirsch report, which was essentially a survey of expectations by various forecasters, primarily peak-oil advocates, …