Energy returned on energy invested (EROEI) Shale oil and shale gas

This is actually a follow-up to questions regarding energy return on investment in shale plays.  The simple answer is probably best answered with a rhetorical question.   Why would the number of drilling rigs in the Williston Basin go from 160 last winter to more than 200 this summer?

Answer: -> Profit

Profits and EROEI are actually closely related.  The resources that are preferentially developed have the best EROEI.  Energy is a currency, and in the case of oil wells, the return on investment is fast.  The total payback time on most Bakken wells is under two years, and really good wells are less than a year. Money does not directly translate to energy, but in the case of hydrocarbons, it is fairly close.

If you are a strong contributor to the green movement, you should ask the same question about wind towers and solar panels, which are currently inefficient and expensive to produce. (I like alternative, but they just are not competitive. See information provided below or read my other post “what it means to be green”)

The energy ratios for fracked oil wells are probably a little better than an average oil well which are about 19:1, but it is important to note that ratio could be all over the place. In terms of energy, I’m not sure if fracked wells are really better than traditional oil wells, but the return on investment is certainly faster. In truth, there is not much decline curve data on fracked wells so nobody really knows just how much oil the wells can produce.   Most estimates show a similar decline curve to traditional oil wells, but lack of data makes it difficult to history match so estimates will likely change.  I anticipate fracked wells to have better decline curves than most traditional wells, but I could easily be wrong. It is important to note that new tertiary recovery techniques are being developed specifically for fracked wells.

Real-world problems associated with new drilling technologies relate to water usage, surface water contamination, and infrastructure degradation.  All of these problems are being worked on, and state governments are working hard to deal with the problems associated with drilling. I say state governments because that is who should be able to control their situation.  Geology is too variable across the country.  Sweeping regulations are not the answer to new drilling technologies.

…I sort of missed the gas portion of this post, but the same rules apply. The price of natural gas should speak for itself.

Some Data for the numbers people:

It is important to realize that these ratios change dramatically year to year based on technological changes. For instance, I know that the ratio for the tar sands is off, but that is not what this post is about, and I do not feel like trying to find data that may not exist yet.

Natural gas: 10:1
Coal: 50:1
Oil (Ghawar supergiant field): 100:1
Oil (global average): 19:1
Tar sands: 5.2:1 to 5.8:1
Oil shale: 1.5:1 to 4:1

Wind: 18:1
Hydro: 11:1 to 267:1
Waves: 15:1
Tides: ~ 6:1
Geothermal power: 2:1 to 13:1
Solar photovoltaic power: 3.75:1 to 10:1
Solar thermal: 1.6:1

Nuclear power: 1.1:1 to 15:1

Biodiesel: 1.9:1 to 9:1
Ethanol: 0.5:1 to 8:1

This list comes from:

• Richard Heinberg, Searching for a Miracle: ‘Net Energy’ Limits & the Fate of Industrial Society.

Misconceptions regarding energy returned on energy invested of shale plays:

1. The oil is thick and does not flow without additional heat or fluids.  “For example, an energy source like oil shale that is a solid material at room temperature and has low energy density per unit of weight, and volume is highly unlikely to be good as a transport fuel unless it can first somehow profitably be turned into a liquid fuel with higher-energy density (i.e., one that contains more energy per unit of weight or volume).”

This is simply false in most cases.  The misconception is largely derived from people confusing the tar sands in Alberta, Canada, and the Green River Shale in Colorado and Utah with current shale oil plays. 

For the most part, Bakken, Three Forks, and Niobrara have an API of 36 to 44 degrees.  Since that number doesn’t mean anything to most people Bakken oil looks a little like dark green swamp water.  It flows and smells a little like a mix of solvents(alcohols).  It can evaporate some and looks nothing like motor oil or tar.

2 Oil shales are mined not drilled.

The answer is the same as above, and refers to the Tar Sands and Green River Shale.

One little rant for good measure:  If I read one more comment that says we should wait to develop our resources until we know how… I might reach the computer screen and punch them in the face.  There are two options if we wait.  1. Total economic collapse with nothing to show for it (This may be unavoidable at this point)  2.  Oil companies will do their development overseas, and our economy will collapse for sure.  Energy is more valuable than any currency because you can actually do something with it. Nothing beside energy can drive growth of any kind.