A report from Wood Mackenzie, the Edinburgh-based consultancy, calculates that the world holds 3,600bn barrels of unconventional oil and gas that need a lot of energy to extract.
So far only 8 per cent of that has begun to be developed, because the world has relied on easier sources of oil and gas.
Only 15 per cent of the 3,600bn is heavy and extra-heavy oil, with the rest being even more challenging.
[Link: FT.com]
The concept of ERoEI (Energy Return on Energy Invested) is thrown around a lot in discussions of energy depletion and Peak Oil. Most of us think of it as a measure of the difficulty of obtaining the oil but its real importance might be its relationship to reserves. Think about it for a second. If a barrel of very difficult to extract oil has an ERoEI of 1.0 (ie it takes the energy equivalent of a barrel of oil to extract it) it really doesn't exist. There is no reason to go after it. In other words you can't really count that barrel as part of our energy reserves if we count the barrel we will use to get it out. Taking that a little further, we really should degrade all reserve estimates by the ratio of ERoEI of the oil in reserve. If oil is twice as hard to get out, it should only count as half as much oil when we add up our reserves. I am going to have to think about this some more but if I am right the world's oil reserves have just gone down a lot.
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