How Much Untapped Oil Is There? The Answer Varies

December 2, 2010, 11:08 am

How Much Untapped Oil Is There? The Answer Varies

Green: Business

As John Broder and I report in Thursday’s Times, the Obama administration has reversed itself on opening vast acreage along the Atlantic coast and in the eastern gulf to new oil and gas drilling.

The decision has stirred an outcry in the industry, but how much oil and gas is really at stake? That’s a hard question to answer definitively, in part because little if any seismic testing has been done in the areas over the last three decades.

As our article explains, the federal government estimates that the eastern gulf contains 3.7 billion barrels of oil and 21.5 trillion cubic feet of gas, while the Atlantic coast has 3.8 billion barrels of oil and 37 trillion cubic feet of gas. Taken together, that is roughly comparable to Norway’s proven oil reserves and Canada’s proven gas reserves. The expansion of offshore drilling announced in March only partly opened those waters; although it still would have made available enough oil to fuel more than 2.4 million cars and gas to heat eight million households for 60 years.

But those estimates are not broadly accepted as fact. Some say they are too small, and others think they are overly optimistic.

For example, Jon Blickwede, a senior geologist for Statoil, the Norwegian oil giant, said in an interview this year that he was optimistic that the eastern gulf area had substantial potential. He based his assessment on the fact the geology of the eastern gulf is very similar to that of coastal central and southern Mexico, where there are very productive oil fields. Both basins are dominated by carbonate rocks, which also are dominant in the giant oil fields of the Middle East.

Mr. Blickwede also said there was a chance that drilling off the Atlantic coast could produce good results. He noted that parts of the coast were connected until approximately 200 million years ago to parts of the coast of West Africa like Guinea and Mauritania, where oil has been found. He noted that studying the geology of Morocco had aided oil technicians explore off the coast of Nova Scotia.

But T. Boone Pickens, the billionaire Texas oilman who has been a practicing geologist for 50 years, has expressed skepticism about the richness of remaining offshore reserves in the United States.

Given that there are no significant oil reserves onshore along the Eastern Seaboard, he said in an interview this year, oil and gas reservoirs are most likely limited offshore as well. As for the eastern gulf, he noted that its waters are far from the Mississippi River, which poured sediment into the gulf over millions of years that eventually developed into fossil fuels.

The administration’s plans do not preclude future seismic testing. So we may eventually find out whether Mr. Blickwede or Mr. Pickens is correct. And if there are great reserves to be found, and prices of oil and gasoline go higher as the economy recovers, who can predict whether the additional offshore drilling will be prohibited forever?