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Energy Return On Investment

I was reading a post on The Oil Drum in preparation for interviewing its author, Dr. Charles Hall. The gist of it is that in the USA in the 1930s, if someone put the energy equivalent of one barrel of oil into the task of oil exploration and extraction, they got about 100 barrels of oil returned on their 1 barrel's worth of invested energy.

EROI = 100:1

Now that number is significantly lower. It varies from region to region, but 15:1 would probably be a very optimistic (possibly Panglossian) estimate. What's more, in spite of rapidly advancing technology in the oil industry, that ratio has been dropping increasingly rapidly in recent years.

...the cost of getting energy has been increasing greatly of late which implies that the world is approaching a point at which the energy required to get new oil will be a substantial part of, and eventually all of, the energy found within the barrel. At this point the oil age will be over, regardless of the amount of oil left in the ground or the price that the oil commands. (...)

Many economists will say that EROI undervalues the role that technology will play in accessing deeper and poorer quality reserves. But as we have stated, EROI in the US obtained at least 100 barrels of oil from each barrel invested in going after it in the 1930’s but only about 10 for one in about 2000, despite the tremendous increases in technology. Therefore, in the US, and subsequently the world, geologic limits have trumped technological advances, and so we reiterate: the argument about how much oil is left in the ground misses the point - what is important is not the total oil remaining but how much we can get out at a significant energy profit.

Emphasis retained from the original post.



( 1 comment — Leave a comment )
Nov. 12th, 2010 09:52 am (UTC)
Right on target
Yeah KMO,

That's pretty much the math of it. Once it takes more than a barrel of oil to extract a barrel of oil you're on the far side of the slippery slope. Can't wait to hear the interview.

( 1 comment — Leave a comment )

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