US to become world's largest gas and oil producer
The fracking boom could move the country into first place as early as this year, according to a government agency. But how long will it last?
By Jim Probasco
The U.S. could become the world's largest single producer of oil and natural gas this year, the Energy Information Administration said Friday.
This flies in the face of much conventional wisdom that most of the world’s fossil fuels come from Russia and the Middle East. Conventional wisdom, in this case, hasn’t been correct for a while. The United States surpassed Russia in the production of petroleum and gas fuels in 2012. It only lagged behind Saudi Arabia in oil.
Thanks to hydraulic fracturing (fracking), the U.S. will move into first place in 2013. At that point, the country will be the world leader in both gas and oil production.
As the EIA pointed out, comparing oil and gas production in different countries is difficult. Energy content differences, the inclusion (or exclusion) of biofuels and refinery gains as well as other factors all play a role.
The prime driver of the increase in U.S. production over the past five years has been the extraction of shale-based oil reserves in Texas and North Dakota via fracking. Natural gas production has seen an increase due to fracking-based production in Pennsylvania and other parts of the eastern U.S.
There is no question that the United States will be the top oil and gas producer by the end of 2013. But, how long will it all last? In 2012, the EIA said U.S. natural gas reserves would last about 92 years, at current rates of consumption.
This, of course, doesn’t mean that the rate of production will remain constant. Production rates are a product of available technology and the cost of developing that technology. Profitability is also a major factor.
Public sentiment is another. Fracking is controversial. Coinciding with the EIA report that the United States would soon be the world’s number one energy producer was one from an environmental group calling for a complete ban on fracking.
Environment America’s report, Fracking by the Numbers, is filled with statistics related to fracking in the U.S. For example, the report said fracking produced 280 billion gallons of toxic wastewater in 2012, along with 45,000 tons of air pollution and 100 million metric tons of CO2-equivalent global warming pollution.
The Wall Street Journal reported on a Pew Research Center for the People and the Press poll in September that found opposition to fracking rose from 38 to 49 percent in six months.
So far, however, companies seem to be forging ahead with financing and production of both oil and gas in the United States.
As Ken Hersh, chief executive of NGP Energy Capital Management LLC, told The Wall Street Journal, "It is not a supply question anymore. It is about demand and the cost of production. Those are the two drivers."
At the time of this writing, Jim Probasco had no position in any mentioned securities.
Read more from Benzinga
And on a side note, Our local electric provider is currently attempting to up- charge
My problem is with fracking ,when ground water ignites in areas where fracking occurs ,That is not a good thing. Pretty soon ,if this continues, water will take the place of gas and cost us $4.00/gallon.
And don't think this can't happen .Water is far more precious than gasoline or natuarl gas,Ask the people in Pensylvania,where fracking is going on .
If this is really true then why are our gas prices so high????? BECAUSE WE GIVE IT ALL TO CHINA!!!!!!!! Hey dummy that calls himself president. Stop tearing our country apart , get off your sorry dead **** and quit supporting other countries. Take care of business here and then say how great you are!
NOT!!! we need to tell the world to kiss off and get OUR country great again. Stop the stupidity fom the white house and his supporters.
Oil... gotta love that stuff. It's in our cars, our smartphones, our sporting equipment, our medical equipment, our public transportation, our homes, our schools... The list could keep going and going.
So what if we found new ways of extracting the stuff? Fracking, we are not the only country using this technique. Take a look at South America and Africa. We need to find clean ways for producing things from said oil. The old refineries need to be torn down and new ones built to EPA spec and not just patched up-to-code. Old oil rigs in the sea needs to be torned down and rebuilt with new tech else would would have more BP/Gulf of Mexico issues because of cheap patches here and there to be up-to-code.
But, hey, what do I know. I'll just type way on my oil-base plastic keyboard and stare blankly at my mostly oil-base plastic display.
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