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Why the New 'Golden Age of Oil' Has Been a Bust

To reach their ambitious targets, energy firms will have to overcome severe geological and environmental barriers -- and recent developments suggest that they are going to have a tough time doing so.

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If the U.S. proves too tough a nut to crack, Alberta has a backup plan: construction of the Northern Gateway, a proposed pipeline through British Columbia for the export of tar sands oil to Asia.  However, it, too, is running into trouble.  Environmentalists and native communities in that province are implacably opposed and have threatened civil disobedience to prevent its construction (with major protests already set for October 22nd outside the Parliament Building in Victoria).

Sending tar sands oil across the Atlantic is likely to have its own set of problems.  The European Union is considering adopting rules that would label it a dirtier form of energy, subjecting it to various penalties when imported into the European Union.  All of this is, in turn, has forced Albertan authorities to consider tough new environmental regulations that would make it more difficult and costly to extract bitumen, potentially dampening the enthusiasm of investors and so diminishing the future output of tar sands.

Extreme Planet

In a sense, while the dreams of the boosters of these new forms of energy may thrill journalists and pundits, their reality could be expressed this way: extreme energy = extreme methods = extreme disasters = extreme opposition.

There are already many indications that the new “golden age” of North American oil is unlikely to materialize as publicized, including an unusually rapid decline in oil output at existing shale oil drilling operations in Montana.  (Although Montana is not a major producer, the decline there is significant because it is occurring in part of the Bakken field, widely considered a major source of new oil.)  As for the rest of the Western Hemisphere, there is little room for optimism there either when it comes to the “promise” of extreme energy. Typically, for instance, a Brazilian court has ordered Chevron to cease production at its multibillion-dollar Frade field in the Campos basin of Brazil’s deep and dangerous Atlantic waters because of repeated oil leaks. Doubts have meanwhile arisen over the ability of Petrobras, Brazil’s state-controlled oil company, to develop the immensely challenging Atlantic “pre-salt” fields on its own.

While output from unconventional oil operations in the U.S. and Canada is likely to show some growth in the years ahead, there is no “golden age” on the horizon, only various kinds of potentially disastrous scenarios.  Those like Mitt Romney who claim that the United States can achieve energy “independence” by 2020 or any other near-term date are only fooling themselves, and perhaps some elements of the American public.  They may indeed employ such claims to gain support for the rollback of what environmental protections exist against the exploitation of extreme energy, but the United States will remain dependent on Middle Eastern and African oil for the foreseeable future.

Of course, were such a publicized golden age to come about, we would be burning vast quantities of the dirtiest energy on the planet with truly disastrous consequences.  The truth is this: there is just one possible golden age for U.S. (or any other kind of) energy and it would be based on a major push to produce breakthroughs in climate-friendly renewables, especially wind, solar, geothermal, wave, and tidal power.

Otherwise the only “golden” sight around is likely to be the sun on an ever hotter, ever dirtier, ever more extreme planet.

Michael T. Klare, a TomDispatch regular, is a professor of peace and world security studies at Hampshire College and the author, most recently, of The Race for What’s Left.  A documentary movie version of his book Blood and Oil is available from the Media Education Foundation.