Fracking* is a method of extracting natural gas (and increasingly oil) that seems to be transforming the energy industry.
This Bloomberg article says that the U.S. oil market may be about to have a fracking revolution not unlike what has happened with natural gas.
Fracking Boom Could Finally Cap Myth of Peak Oil
In the U.S., the primary controversy when it comes to fracking has been and continues to be concerns over the adverse environmental effects.
Still, what seems amazing, no matter how the environmental issues play out, is how quickly these advances have changed the oil and gas landscape.
In the article, CEO Jim Mulva of ConocoPhillips said the following:
"The revolution has spread to domestic oil production. And it may track the path it followed with natural gas."
Experts refer to oil that comes from shale formations as "tight oil".
The federal Energy Information Administration estimates that production of crude oil in the U.S. will rise to 6.7 million barrels per day by 2020 (much coming from tight oil and development of offshore resources), a level not achieved since 1994.
As a comparison, domestic crude oil in the U.S. was produced at a rate of 5.5 million barrels per day in 2010.
Some think the future estimates are still conservative since projections of "tight oil" continue to be revised higher. Energy analyst Seth Kleinman added this in the Bloomberg article:
The year ahead, he [Kleinman] says, "could really see the death of the peak-oil hypothesis..."
This Reuters article from late last year also explains some of the implications of horizontal drilling and fracking. Some excerpts from the article:
Transformed in Less Than Half a Decade
The combination of horizontal drilling and hydraulic fracturing has already transformed North America's natural gas market in less than half a decade. It is now starting to do the same for U.S. oil production...
Worldwide Transformation & Major Constraints
Fracking and horizontal drilling have the potential to transform the industry worldwide.
Inside North America and Western Europe, the major constraint on the roll-out of the technology is political and environmental opposition. Outside the United States, the main constraints are lack of specialised equipment, know-how and skilled personnel.
The lack of specialised equipment and skills outside the U.S. would seem to sort itself out over time. Knowing how some of the environmental controversies end up impacting the potential of all this seems harder to gauge.
* The term fracking (or hydrofracking) is short for hydraulic fracturing.
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