by Bill Chameides | October 1st, 2008
posted by Erica Rowell (Editor)
With the cost of gas still near record highs and crude oil prices rising and falling like a ride at Six Flags, drilling for oil has been capturing imaginations and grabbing headlines. But caveat emptor: misinformation abounds. In one case a recent graphic by a respected news service painted a rosier picture of our nation’s resources than the facts would indicate.
Take a look at the graphic. The black text shows the original as it appeared in newspapers; the text in red shows our corrections. The bottom line: lifting all bans on offshore drilling will make about an additional 18 (not 115) billion barrels available for drilling.
So Where Does the Estimate of 115 Billion Barrels Come From?
The “115 billion barrels” number corresponds to the United States’ total endowment of technically recoverable offshore oil (see this Congressional report [pdf]). The operative word in this category is “endowment.” It includes both:
- an estimate of what is remaining in the ground (in terms of discovered resources and future finds) and
- the amount of oil we have already recovered and used (in oil-world jargon this is the cumulative production).
Since the debate is about how much oil we can get from opening up offshore fields for drilling, we clearly cannot count the oil we have already used — some 14 billion barrels. Subtracting that from 115 leaves us with 101 billion barrels.
But there is another problem: the remaining 101 billion barrels include some 15 billion barrels of oil in fields that have already been discovered and to which oil companies already have access. If they already have access to them, those barrels clearly do not represent oil that can be gotten by opening new oil fields. When we subtract these 15 billion barrels, we are left with 86 billion barrels — the so-called undiscovered technically recoverable resource (UTRR). (See report [pdf].) The UTRR is the total undiscovered potential oil resources we think might be in the ground based on geologic knowledge and theory (see our glossary for more on UTRR).
This UTRR is what the offshore drilling discussion has really been about — or should have been about. Hence, the change in title.
To underline the point, let me reiterate: the total offshore UTRR for the United States is estimated at 86 billion barrels.
Potential Offshore Oil Resources: Very Speculative
It’s important to note that UTRR is an estimated, undiscovered resource without consideration of how much money it would take to get it to the pump. In other words, there is no guarantee that it’s really there and if it is, that it would be economically viable to produce.
Offshore Potential Resources: Most Is Already Available for Drilling
To date, most of our offshore drilling has been concentrated in the Gulf of Mexico. From the corrected graphic you can see that at 45 billion barrels, about 50 percent of our undiscovered technically recoverable offshore oil resource is located in the gulf. Alaska holds another 31 percent of our offshore UTRR.
What most people don’t realize is that oil companies already have access to 90 percent of the gulf’s UTRR and 100 percent of UTRR located off the coast of Alaska. Only some of the eastern part of the gulf, which is estimated to hold about 4 billion barrels of UTRR, has remained off limits to leasing. But opening up this part of the gulf is not currently on the table, as this region is closed to drilling under a separate Congressional ban that will remain in effect until 2022.
How Much Potential Oil Is At Stake
So the drilling bans Congress has allowed to expire will only open up offshore lands along the Atlantic and Pacific coasts, giving us access to about 14 billion barrels of undiscovered technically recoverable oil. If Congress also lifted the ban on drilling off Florida’s coast, the additional 4 billion barrels this region is thought to hold would bring the total to 18 billion barrels.
So, here’s the bottom line. The debate that has consumed our nation has been about 18 billion barrels of offshore oil that may or may not be there and/or may or may not be economically recoverable to produce. That’s a whole lot less than the 115 billion barrels that appeared in our newspapers.
“Report to Congress: Comprehensive Inventory of U.S. OCS Oil and Natural Gas Resources,” Minerals Management Service -
“Assessment of Undiscovered Technically Recoverable Oil and Gas Resources of the Nation’s Outer Continental Shelf, 2006,” Minerals Management Service -