How global warming will save us from peak oil

A melting Arctic will make it easier to extract fossil fuels from the formerly frozen north.

Topics: Environment, Energy, Globalization, Global Warming, How the World Works, Peak Oil,

The best reason yet not to be worried about global warming: A more pleasant climate in the Arctic will make it easier for oil and gas companies to extract resources in the formerly harsh north.

That is the most delightful nugget to be mined from a front-page article in Tuesday’s New York Times by Jad Mouawad, “A Quest for Energy in the Globe’s Remote Places.” Here is a reporter for whom the glass is always half full, of fossil fuel.

Indeed, the world’s fast-rising use of fossil fuels, by contributing to global warming, could eventually make the Arctic more accessible for oil and gas production.

That’s the kind of insight that will have you whistling a happy tune all day long. But it’s not the only factoid of interest in Mouawad’s account of the mighty engineering obstacles that must be overcome as oil companies search for fossil fuels in remote areas.

“There are no easy barrels left,” said J. Robinson West, chairman of PFC Energy, an industry consulting firm in Washington. “The only barrels are going to be the tough barrels.”

Some context: In March, Mouawad sent a frisson of outrage through what, for better or worse, we can call the “peak oil community” when, in an article detailing how new technological advances would enable oil companies to extract more oil from fields previously deemed exhausted, he unloaded the following broadside.

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There is still a minority view, held largely by a small band of retired petroleum geologists and some members of Congress, that oil production has peaked, but the theory has been fading …

Within the last decade, technology advances have made it possible to unlock more oil from old fields, and, at the same time, higher oil prices have made it economical for companies to go after reserves that are harder to reach. With plenty of oil still left in familiar locations, forecasts that the world’s reserves are drying out have given way to predictions that more oil can be found than ever before.

More oil can be found than ever before, but the only barrels left are “tough” ones. Hmm. What could that possibly mean? Perhaps, that the price of oil will only go up? And up, and up, and up?

How the World Works does not have a position on whether peak oil has already occurred, or if the moment when global production reaches its upper limit and begins to decline will come next year, in five years, or in 10. Making predictions of that sort is a fun parlor game for retired petroleum geologists, but fixating on the issue misses the point. In March, Mouawad’s upbeat reporting told us that there was lots of oil left, and new technology was going to get it. In October, the picture is a little different: Lots of oil may be left, but it’s going to be increasingly expensive to get it. He notes, “According to a recent study, discovery and development costs, a key indicator for the industry, tripled from 1999 to 2006, to nearly $15 a barrel.”

The dynamics that underlie a steadily rising price for oil are more important — for the global economy, for the economics of alternate forms of energy, for the challenge of climate change — than whether we’ve hit the peak. The oil companies are going to be in business for a long, long time, extracting every last milliliter of oil and gas from every last nook and cranny in the earth. Whether we can afford to pay for the resulting product is an entirely different question.

Andrew Leonard
Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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