Oil will dominate for decades and why

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That will not happen, says Exxon, because it cannot happen. Exxon is certain that oil, gas and coal will remain the world's dominant energy sources for decades to come.

That belief drives the company's critics crazy. But Exxon's projections are not radical. A forthcoming report from the U.S. Climate Change Science Program cites three of the most widely used models for climate change analysis: one from MIT, another developed jointly by the Pacific Northwest National Laboratory and the University of Maryland, and a third created by Stanford University and the Electric Power Research Institute. The studies do not agree on everything but they do agree on this: Fossil fuels will remain the planet's No. 1 energy source through the 21st century, supplying 70% to 80% of the total by 2100, vs. about 90% today. Exxon forecasts only as far as 2030; in that year, it projects, primary energy sources such as coal, oil and gas will account for 81% of global demand.

That's another reason Exxon isn't investing in alternative energy sources: They don't look big enough. For a company Exxon's size - No. 2 on the Fortune 500 - businesses of less than mammoth scale don't merit troubling with because they can't nudge the bottom line.

It's worth noting that the company carries no genetic hatred of alternative energy. In the wake of the 1970s oil shocks, it conducted major research in solar energy, and it holds dozens of patents in the field. But it couldn't see how to earn a profit, and shut the program down. That experience also thickened the company's skin. While greens today vilify Exxon for not investing in solar power, back then they attacked the company for investing in it. The theory was that oil companies would monopolize solar and then withhold its benefits from the public to sell more oil.

Exxon avoids investment in alternative energy sources for yet another reason, one that reaches deep into the company's experience: Much depends on the future price of oil, and no one knows what it will be. Consider two scenarios. If oil dropped to $25 a barrel - about what it was (in today's dollars) just before 9/11 - alternative energy would look even less attractive economically. Exxon's decision not to invest would look all the wiser, but its oil-related profits would shrink. Conversely, if oil rose to $100, its profits would rise but many alternative energy sources would become economically viable - and Exxon wouldn't be able to capitalize on them.

http://money.cnn.com/magazines/fortune/fortune_archive/2007/04/30/8405398/index.htm
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Which brings us to the biggest beef Exxon's critics have: Why isn't the company investing in less polluting energy sources like biofuels, wind, and solar? Remembering that Exxon is above all in the profit business, we know where to look for the answer. As a place to earn knockout returns on capital, alternative energy looks wobbly. For example, the darling of the moment, ethanol, is nowhere near economically competitive with gasoline (and may not be better environmentally, because it is fuel- and land-intensive to produce). Take out the 51-cents-a-gallon federal subsidy, and the true cost of U.S.-produced ethanol is equivalent to paying $6 a gallon for the same energy as gasoline, calculates Michael B. McElroy, Harvard professor of environmental studies. Even subsidies granted for national security reasons can come and go. To a disciplined investor, such a product is not especially attractive. "I don't have a lot of technology to add to moonshine," says Tillerson of ethanol.

It's a similar story for alternative fuels for power generation. Solar-generated electricity is still way costlier than juice from traditional coal- and gas-fueled plants. Wind power is narrowing the gap but is difficult to scale up. Hydro and biomass are clean and fully competitive on cost - but Exxon just doesn't know much about building dams or burning agricultural waste. Its expertise is in oil and gas, as exemplified by its world-class Upstream Research Center in Houston; the company is happy to leave the alternative stuff to others.
 
Yeah butt Exxon should be figuring this problem out......

Yeah butt the Government should be figuring this problem out....

The answer is right on your shoulders....too many butts....not enough heads.
 
exactly, as I mentioned previously, the reason why we dont have F-T fuel and other "alternative", non-foreign sources of things sucj as gasoline isnt that it is not doable, etc. Heck, the South Africans run on at least 50% synthetic fuel, and the Germans used it in WWII.

It is because the capital cost is high, and as soon as major investment is slated, oil prices decline and then it is not economically feasible. The whole "future price of oil" part is key. And while some claim $200/bbl oil, the generally agreed upon value of same is $92/bbl. Not quite the same amount.... and likely too low to justify a multi-billion dollar capital cost improvement.

Synfuels, alt fuels and the investment to make them unfortunately can only come via one practical way - the letting of government contracts guaranteeing to buy alternative fuel such as F-T fuel at a fixed price that is advantageous to the company.

Unlike our public utilities, where we can pay a surcharge and be guaranteed to have bought solar, wind, etc. power, it is not easily transparent to the user. So without at least a law, such as the ethanol bit, it wont happen. Likely no person on here will pay 5c/gal more for synthetic fuel, or drive 10 miles out of their way to get it from a station (again, transparency to the end user, like your utility certifying wind power was used)...

You need a major buyer guaranteeing the purchase of a certain amount, to allow the build and use of a plant. While in no way, shape or form a major user in the grand sense, the government is the only entity that is major enough to guarantee a significant useage of such a product.

Without such a guarantee, we will never see it. There arent enough hippies and well meaning people, nor enough guaranteeed high oil prices to justify investment.

of course GS may well be highly invested in alternative fuel and F-T fuel companies, and so by preaching the $200/bbl doom and gloom, they can force those segments to grow, profiting for themselves...

JMH
 
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the South Africans run on at least 50% synthetic fuel, and the Germans used it in WWII.

Both of those come from coal and produce twice as much CO2 than does petroleum (according to Wiki). And does the process yeild more energy than it takes to convert the fuel from solid to liquid?
 
CO2 can be sequestered. The feedstock can be used as an energy source to drive the process (like petroleum refining). Nothing is free, except potentially the sunlight we get.

Oil dominating for decades means that we need practical sources of feedstock. I dont see ethanol being one. Algae-based biodiesel, perhaps. The reality is that what we will be able to use as "oil" based products is dependent upon what we have locally. If we want to get away from foreign oil, and keep economies stable, you need to shift at least to some point to a feedstock that is reasonably available and can be utilized. Coal is that feedstock, for some applications.

Electric cars and stuff are great, but they dont address the capital improvements necessary to fix our electric grid, let alone our electrical generation needs. Yet another reason exxon doesnt see us getting away from oil.

We still need that practical energy carrier. CO2 can theoretically be sequestered, or with nuke power, can be run in an SOFC electrolyzer via a reverse water-gas shift to produce CO and H2, which are... ta da... the feeds for an F-T synthesis process.

Might not be the end all, be all in cleanliness and efficiency, but should we really run out of affordable oil, this will be the next step (in additon to oil shale and tar sands).

JMH
 
Oil's winning use is dense, mobile fuel for stuff like vehicles and heating rural homes.

It seems like some mighty inefficient technologies are being proposed to take something that would efficiently and cheaply power an electric plant, and transforming them into liquid fuel just to power some jerk's oversized vehicle.

It's a travesty to use oil for generating electricity in a "peaker" plant.
 
I agree, it's also stupid to use NG for power generation.....it's so darn clear that the greenies hoodwinked us out nuclear power....a real travesty.

Whichever candidate announces a "Manhattan Project" to get us to 50%+ electricity from nuclear in the next 10 years gets my vote. Even if it's one of the twins.
 
Natural Gas being burned in a power plant at 23 percent efficiency is an absolutely disgusting waste of a high utility fuel. Even at 60% it's still insane to use a high utility fuel in stationary power apps.

Least tractable fuel is nukes...should be used in big power gen applications, and should be now, across the globe

JMH, I am scared witless of CO2 "sequestration".

Firstly, with every "C" that you bury, you bury an O2...I don't like that.

Secondly CO2 and water make acid, so the deep ocean trench "storage" will have untold effects on the marine ecosystem. Underground could acidify aquifers etc.

Thirdly, the millions of tonnes that would be pumped under ground consume even more energy, producing more CO2 per unit of power production.

Fourthy, and this is what scares me, even a small leak has more capability (IMO) than nukes of causing widespread instantaneous death. A day's worth of stored CO2 (and the storages are going to have to store 10,000 days of production) has the potential to kill every air breathing animal in a district. It's happened when dams release their CO2 after tremors....You think nuke companies have favourable liability exclusions "for the greater good", the liability limitations of any company sequestering CO2 will likely be insane.

BTW, sequestering CO2 in the vicinity of coal mines (where power stations are built) could potentially cut off the fuel supply due to leakage.
 
Given the implications of NOT having liquid fuels to provide mobility and transport, unfortunately at some point they will have to be made. Again, look at the sad shape of our electric grid, the sad shape of our power plants, etc. Will that support 15% of the homes having a plug-in EV? 25%? 50%? Even so, will that plug-in EV actually be a plug-in HEV? Then it would still need some component of liquid fuel.

Is burning coal to make electricity that much more environmentally or CO2 friendly than making F-T fuel? Tonnage wise, both are dirty.

My point being that ultimately, CO2 can be reverse-shifted into CO and H2, perfect feedstocks for synfuels, so one can capture and "re-use" CO2, to a point. So "sequestration" is only needed to the point where it can be reused as a feedstock, because in the end all, it isnt the best prcess for anything - I agree. Again, power is neded to do this, but it is very basic electrochemistry. Or we can use algae ponds, which on a CO2 scrubbing (forget CO2, we need carbon to make fuel, right???) and photon efficiency basis, nothing is better for producing the feeds you need to make a biodiesel type fuel. Co-locate with nutrient-rich byproducts, and the stuff will grow. But then you need light, and water, etc. NOTHING is free, and certain things will work in regional applications - nothing is a world-over winner.

We all need to remember that nothing is free.

I'm neither a fan of CO2 sequestration, F-T fuels, Algae/bio fuels, etc. I am a technologist who has to look at this stuff on a detailed basis, nearly every day.

There is an argument against every technology. And they are all valid. But again, our infrastructure will not support millions of EVs, and their range will not support us. Any other application will still be tied to cheap, available liquid fuel.

When the wells do start going dry (whenever that may be), and oil does prop itself to a sustainable $200-$400/bbl, we may not have a choice.

The question is whether or not we desire to be prepared with some real, decent means of offsetting at least a fraction of our dependence on something with a better energy balance than ethanol, or if we just want to wait, since everything is too harmful in one way or another, until our economy grinds to a halt.

JMH
 
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Both the tree huggers and oil companies are to blame. Consumers as well.

Oil companies welcome the stricter guidelines that the tree huggers have allowed to get passed through government. It restricts supply which ultimately benefits the oil companies. Demand exceeds supply. It's simple economics really.

We are an oil culture. We have been for years. We are a very independent minded culture that wants to go where we want to go when we want to. We love cars. Hundreds of thousands of jobs are wrapped up in the oil industry.

Other countries have a different mindset. A bit more socialistic and looking out for the "greater good". It's going to take very high gas prices to break us from this mindset.
 
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