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Posted by on Feb 25, 2011 in Economy, Science & Technology | 0 comments

More BS from the Peak deniers

The headline sounds good:

New Study Shows That Offshore Drilling Could Make Alaska the Eighth Largest Oil Producer in the World – Ahead of Libya and Nigeria

(CNSNews.com) – A new study says drilling on Alaska’s Outer Continental Shelf (OCS) could make Alaska the eighth largest oil resource province in the world — ahead of Nigeria, Libya, Russia and Norway.

The report — by the consulting firm Northern Economics and the University of Alaska-Anchorage’s Institute of Social and Economic Research — says that developing Alaska’s OCS could produce almost 10 billion barrels of oil and 15 trillion cubic feet of natural gas, create around 55,000 new jobs and produce $145 billion in new payroll nationally, generating a total of $193 billion in government revenue through the year 2057.

But of course there is one little problem – that’s not what the report says at all. Oil Drum commentor Alaska_geo explains:

Well the CNSNews headline and article completely misstates what the Northern Economics/ISER report is about. The report says IF Shell finds a hypothetical 5 billion bbls and 7 tcf in the Beaufort, and 4.8 billion bbls and 7.8 tcf in the Chukchi THEN the economic impact would be 35,000 jobs, $72 billion payroll etc etc. However, the original report doesn’t say a damn thing about how likely (or not) it is to find that much.

Shell is, of course, has spent a big pile of money for leases in the Beaufort and Chukchi and is now fighting for the permits to drill there. Thanks to BP in the deepwater GOM, getting those permits has become very questionable. They have had rigs and support vessels on contract for going on 3 seasons now to drill in the Beaufort, but so far have been denied permits.

The notional volumes used in the report appear to have come from previous estimates made by the agency formerly known as MMS (BOEMRE). Like all such estimates it is a wild assed guess made on limited data. IS there that much oil/gas out there? We will not know unless/until it is drilled. COULD there be that much out there? Sure. Shell now owns the Hammerhead and Sivulliq (formerly known as Kuvlum) structures. Both were drilled in an earlier round of Beaufort drilling and are believed to be at least in the range of 1-200 million bbls. There is still a lot of very sparsely explored area out there and Shell obviously thinks there is significant potential. The original report was commissioned by Shell and is clearly an effort to build support for drilling, based on potential economic impact. The CNSNews people spun it as meaning there definately is that much out there, and clearly they don’t know what they are talking about.

Just another case of rightwing websites spinning for their corporate masters.