Air University Review, July-August 1983

Resource Shortages: How Serious?

Dr. Leonard G. Gaston

The Global 2000 Study’s energy projections show no early relief from the world’s energy problems . . . petroleum production capacity is not increasing as rapidly as demand.1

World oil prices, now declining in real terms should increase little, if any at all, through the year 2000, expect for periodic inflationary adjustments. Oil imports and dollar outflows will drop drastically by the end of this decade. And with Western Hemisphere self-sufficiency, oil dependence on the Middle East—and the current financial, political, and security problems--may become a thing of the past.2

Resource scarcities will influence both the future capability of the Air Force, and as a result of the maneuvering of have and have-not nations, the demands likely to placed on it. This article briefly examines three potentially troubling resource areas: food, nonfuel minerals, and petroleum.

Is the resource picture universally dismal? Can the market mechanism be expected to come up with solutions to resource shortages? In the energy area the hope for market-stimulated solutions appears promising, assuming there is progress in conservation and development of alternative fuels and given world stability to provide time for these energy adjustments. In the second serious area of shortage, that of strategic minerals vital for the operation of the U.S. economy, changes in laws and regulations which have hampered operation of the market may significantly reduce U.S. vulnerability to interruptions in foreign supplies. If this is the case, it may then be the remaining area of the three, food supply versus population, that will pose the greatest long-term (20-30 year) threat to the United States in terms of its effects on world stability.

The recent monumental work on natural resources and the future, although not without its critics, is the Global 2000 Report to the President.3 The report was released in 1980, after three years of study that began in May 1977, with then-President Carter’s instructions to various federal agencies to cooperate in a one-year study ". . . of the probable changes in the world’s population, natural resources, and environment through the end of the century." An executive group, jointly directed by the State Department and the Council on Environmental Quality, coordinated the collection and analysis of various models and their projections of the future, drawing on a variety of federal agencies and outside consultants. The result was a voluminous three-volume report that forecast a cloudy future:

If present trends continue, the world in 2000 will be more crowded, more polluted, less stable ecologically, and more vulnerable to disruption than the world we live in now. . . . This, in essence, is the picture emerging from the U.S. government’s projections of probable changes in world population, resources, and environment by the end of the century, as presented in the Global 2000 study. They do not predict what will occur. Rather, they depict conditions that are likely to develop if there are no changes in public policies, institutions, or rates of technical advance, and if there are no wars or other major disruptions.4

From our vantage point, we are now in a position to look at the study’s conclusions and, drawing on recently reported developments in the areas of minerals and petroleum, better appreciate the relative seriousness of predicted shortages.

food versus population

In considering the long-term potential for worldwide stress, no factor appears more potent than the combination of food supply, population, and extremely rapid urbanization. Whether it is a question of Malthusian population pressure against limited quantities of arable land and fresh water for irrigation or more a question of distribution, as maintained by a recent study,5 the food-population relationship seems headed in the wrong direction. In fact, it is somewhat difficult to argue with the Malthusian principle of human numbers versus food-producing resources, when viewed in the context of past and present growth in regions such as Africa and Latin America. In terms of numbers, the Global 2000 study predicts that if nothing occurs to change present trends world population will have increased from a base of four billion in 1975 to six billion only twenty-five years later, in the year 2000. Ninety percent of this increase is predicted to occur in the world’s poorest countries. Two major regions, Africa and Latin America, are expected to double their populations. Latin America should be of particular concern because of its likely impact on future stability in the Western Hemisphere. (Specific countries expected to double their populations include Bangladesh, Pakistan, Nigeria, Brazil, and our neighbor to the south, Mexico.)

Different assumptions about changes in the birthrate can result in different assumptions about post-2000 rates of population growth, and even in projections of eventual world population stabilization. However, the population projection for the year 2000 is relatively insensitive to different assumptions about such birthrates.6 The populations of less-developed countries (LDC) are heavily weighted with the young, who have not yet moved through the childbearing years, and thus these populations are expected to grow rapidly. This creates what the study calls "a built-in momentum for future growth." At present, these countries are also generally experiencing an accompanying shift of population from rural to urban areas, a trend that, if continued, would cause cities in the LDC to become "almost inconceivably large and crowded.’’7

A worsening ratio of people to arable land will bring about greater dependence on chemical fertilizers and other agricultural chemicals and on plant breeding for higher yields. In regard to dependence on chemical pesticides, the study looks for an increase in pesticide-resistant insects, based on California’s experience where, of 25 species each causing crop losses in excess of $1 million per year, 17 are now resistant to one or more types of pesticides. Modern plant breeding also brings with it a different kind of danger, because breeding for high yields is based largely on the use of uniform, inbred strains; and the most inbred strains appear to have become weakened in their natural resistance to diseases and insects. The report points out that the corn blight which struck the U.S. corn belt in 1970 illustrated the vulnerability of genetically identical monocultures. This use of inbred strains, along with the predicted disappearance of the genetic material of thousands of species of plant life (possibly 20 percent of all species on earth),8 may in the long run prove more serious than the problem of higher prices for petroleum-derived fertilizers and chemicals.

nonfuel minerals

Although the Global 2000 Report did see a need for new studies and investments, it did not foresee an imminent worldwide shortage of nonfuel minerals.9 However, from the viewpoint of the United States, the outlook is not so benign. A concise summary of U.S. mineral vulnerabilities was presented to the Industrial Readiness Panel of the House Armed Services Committee in late 1980 by General Alton D. Slay, then Commander of the Air Force Systems Command. He pointed out that technological advances have increased the demand for exotic minerals at the same time that legislative and regulatory restrictions have been imposed on the U.S. mining industry. Yearly imports of nonfuel minerals now total approximately $25 billion, while at the same time the nonfuel minerals industry is impeded by 80 different laws administered by 20 different agencies.10 Foreign dependence has led to use of the term strategic minerals. Of 40 minerals essential to our advanced industrial society, foreign sources are crucial for 20. For current production, and known reserves of these 20 strategic minerals, the United States depends primarily on two areas of the world, Siberia and southern Africa.11

In contrast to relative Soviet self-sufficiency in minerals, the United States relies on a stockpile of strategic minerals established in 1946 and largely neglected since, except for sales made for budget-balancing and inflation-controlling purposes. Prior to the present administration, no stockpile purchases had been made in twenty years. In March 1981, the Reagan administration announced plans for the first purchases since 1960, starting with 1.2 million pounds of cobalt.12

Congressman Jim Santini and others in government and industry believe the evidence indicates that the Soviet Union is conducting a resource war against the West. (To illustrate: Half the world’s cobalt is mined in Zaire’s Shaba Province. The Soviets bought large amounts of cobalt immediately prior to the 1978 fighting in that province. The cutoff in supplies from Zaire caused the price of cobalt to climb from approximately $6 per pound to more than $45. By 1981, it had subsided to approximately $18.)13 This problem may not be unsolvable, however. General Slay, in his testimony, indicated that U.S. vulnerability is in part self-inflicted, a result of law and regulation raising the cost of mineral extraction and processing and closing approximately three-fourths of the 750 million acres of public land. With progress reported in new techniques to locate mineral sources, it may be that a shift in public attitude, and law, will provide an opportunity for the United States to regain some measure of self-sufficiency in this area. 14

In terms of United States, free world, or Western Hemisphere mineral dependence, we must also take account of possible South American sources, including the still-undetermined potential of the Serra dos Carajás region in Brazil. This mineral-rich region, located in northern Brazil, southwest of the mouth of the Amazon River, is largely untapped, but it has recently been reported to contain large deposits of bauxite, gold, nickle, tin, lead, tungsten, uranium, and zinc.

petroleum

Of all potential shortages, energy has received the most attention in the media. And it was in this area that the Global 2000 analysts had the greatest difficulty obtaining long-range projections. At the time, its original analysis was under way in 1977, the Department of Energy (DOE) was unable to provide meaningful energy projections beyond 1990. But even those contained some interesting elements: a rapid predicted increase in nuclear power generation, most of it overseas; an increase in oil usage, demand as it was called, almost exactly matching the overall increase in energy use; and a rather feeble increase in energy from coal.

A significant problem exists, however, with the study’s characterization of the problem: analysts tried to predict a quantity the market would try to buy and called that demand. Such an approach can lead to incorrect conclusions, however, because demand is not one quantity but a schedule of quantities that will be demanded at various prices. It has also been demonstrated that demand for a product or commodity is typically more elastic (responsive to price) in the long run than in the short run. Further, the demand for oil is not one demand but a set of demands for an assortment of products (gasoline, fuel oil, etc.) that can be made from the basic material.

The DOE made new energy projections two years later, in time for them to be included only in the study’s summary volume, and then only in general terms. These projections extended to 1995 and did take into account the rapid price increase for crude oil that occurred in 1979. Consequently, "demand" for petroleum (actually quantity demanded) was predicted to be lower than the energy department had predicted only two years earlier.

The impact of petroleum price, both on quantities supplied and demanded, must be given further attention. But first, it is necessary to establish a foundation in terms of the meaning of two terms: resources and reserves.

resources and reserves

As soon as we begin to examine various predictions concerning if or when "the oil will run out," we encounter two terms, resources and reserves, that are sometimes used interchangeably, even though they, have specific meanings. Figure 1 shows overall resources and the part of total resources that is properly called reserves. The terms are based on a system of classification by the U.S. Geological Survey/Bureau of Mines, which uses two variables: degree of geologic assurance and degree of economic feasibility. Petroleum reserves are made up of only that portion of total resources which has been identified and is presently considered economical to pump out.

Figure 1. Conventional crude oil Reserves

For many years the ratio of U.S. petroleum reserves to production was fairly constant. That is, production increased from year to year and so did reserves. Table I, taken from a study published in 1963, shows the consistency of that previous relationship. This so-called "life index" deviated little from a 12:1 ratio. Because some uncertainty existed as to whether oil would be found where it was expected, some exploratory drilling for proving was required. In, addition, this natural ratio, as it was called, was partly due to the fact that a typical well would last 10 to 12 years, and the oil still in the ground, as yet unpumped, formed a large part of reserves.15 Unfortunately, this stable ratio did not continue. The late 1960s marked the beginning of a consistent decline in the additions made each year to U.S. reserves. Until 1980, this decline was interrupted only briefly, in 1970, the year that Alaskan oil reserves were first reported.16

In Hundreds of Millions of Barrels41

Year

Production
(rounded to
nearest 100 million)

End-of-Year
Proven Reserves
(rounded to
nearest 100 million)

End-of-Year Proven Reserves
as an Approximate Multiple
of Production in Preceding
12 months

1945 17 199 12
1946 17 209 12
1947 18 215 12
1948 20 233 12
1949 18 246 14
1950 19 253 13
1951 22 275 12
1952 23 280 12
1953 23 289 12
1954 23 296 13
1955 24 300 12
1956 25 304 12
1957 26 303 12
1958 24 305 13
1959 25 317 13
1960 25 316 13

Table I. U.S. crude oil production and proven reserves, 1944-6041

One of the most widely referenced estimates of world potential production of conventional crude oil is that prepared by M. King Hubbert, who estimated that 2000 billion barrels were originally available. With approximately 340 billion barrels pumped out, some 1660 billion would remain (660 reserves, 1000 yet to be discovered). In forecasts cited by the Project Independence Study carried out by the Department of the Interior, all but one assumed that higher prices would call forth higher production levels in the United States. Hubbert’s was the exception.17 Figure 2 depicts Hubbert’s estimate of conventional crude oil available in the United States (some 170 billion barrels) as it was presented on 4 June 1974, to the Subcommittee on the Environment of the House Committee on Interior and Insular Affairs. It shows Hubbert’s estimate of past production of domestic oil and predicted future production.18

Figure 2. United States crude oil production

potential unconventional sources of oil

Unconventional sources of oil consist of (1) heavy oil,19 (2) tar sands,20 and (3) oil shale.21 Estimates of the amounts of oil in place and available from these sources vary. The question of availability hinges on technology (which will determine extraction cost) and selling price (in the absence of government guarantees, largely determined by the price level for conventional oil). To obtain some idea of the oil potentially available from unconventional sources, compare published estimates to corresponding estimates for conventional oil.

Various estimates for unconventional sources exist. For example, there are two projections of the quantities available as heavy oil, made at different times by the Bureau of Mines: the earlier one, made in 1965, was an overall estimate of 150 billion barrels (bb) in place, with 20 bb assumed to be recoverable;22 a later estimate, for deposits of heavy oil located just in conventional oil fields, totals 106 bb, with 45.9 bb occurring "under the most advantageous conditions for recovery by thermal processes.’’23 This later estimate suggests that heavy oil alone would have the potential to boost U.S. oil reserves by almost 50 percent, once technology and economic factors were suitable for its extraction. Heavy oil from Canada’s Cold Lake area, estimated to total 104 billion barrels in place with an unknown amount recoverable, could increase North American totals even more.24

Canada’s resources also figure prominently in the tabulation of potential North American oil from tar sands. Some 730 billion barrels have been estimated to be available in the Athabaska region in Alberta. One firm, Great Canadian Oil Sands, Ltd., has been producing oil there since 1967.25 U.S. deposits of tar sands are located for the most part in Utah. Some 2.5 billion barrels are thought to be recoverable, based on strip mining only, and this does not include amounts that might be recovered with the development of satisfactory in situ methods of extraction.26

Various published estimates for shale oil suggest huge quantities possibly available in the far future, but there may be potential for the nearer term. A report prepared for Resources for the Future, National Energy Strategies Project, shows a potential for some 200 billion barrels from shale yielding 300 gallons per ton or more, a quantity of U.S. shale oil roughly equal to the total, past and future, for conventional oil in the U.S. But this total is based on a critical condition: "technical and economic feasibility . . . at acceptable environmental cost.’’27 The environmental cost is expected to include huge quantities of solid waste, of which 25 percent would be highly alkaline calcium and magnesium oxides.28

Although the United States is particularly rich in oil shale deposits, the Global 2000 study also describes significant amounts elsewhere: in southern Brazil, where surface mining operations are currently anticipated for a large deposit known as the Irati shale;29 in the U.S.S.R., where oil shale deposits in Estonia and the adjacent Leningrad region have been exploited for many years by underground mining and then, since some 10 to 15 years ago, by open pit mining; and in Red China, where Manchurian oil shale deposits which overlie thick coal deposits are being mined by open pit methods.3°

If U.S. reserves of conventional oil are approximately 100 billion barrels, as shown in Table II, then the quantities of recoverable U.S. heavy oil (possibly some 45 bb) and shale oil from high grade deposits (as much as 200 bb) would represent significant additions to supply. Other known Western Hemisphere resources of heavy oil and oil from tar sands would add even further to these totals.

Table II. Oil from conventional sources in billions of barrels.

Location

Amount Originally
in Place
Consumed Remaining
World

2000

340

1660

United States

215*

112

103

*Slightly larger than Hubbert's figure cited earlier.
Source: Global 2000 study, vol. ii, p. 190.

the outlook for conventional petroleum

Although potential supplies of petroleum from unconventional sources appear promising in the long run, they depend on technological and economic factors not yet clearly determined. In the nearer term, the economic health of industrialized nations will depend on the availability of conventional petroleum. Recent news reports shed new light on the criticality of oil supplies to both the United States and the Soviet Union.

The authors of the Global 2000 study made two observations which, taken together, suggest that in terms of petroleum dependency the West is in trouble, which it may be; and that the Soviet Empire is in fine shape, which it may not be. First, what did the Global 2000 report say? (1) The industrialized nations with the highest rate of oil use tend to have the smallest reserves and resources. (2) The exception to this rule is the U.S.S.R.

Country by country, reserves and total resources tend to go together, with the exception of the Communist countries. There, development is at an early to intermediate stage, and although these countries are estimated to have only 15 percent of world reserves (recall that reserves are resources that are clearly identified and economical of extraction), they are believed to have 25 percent of world resources.31

But the outlook for the Soviets may not be so encouraging after all. The key is the conversion from resources to reserves—locating the oil and applying economically feasible technology to extract it. And this necessity on the part of the Soviets to convert resources to reserves may have an impact on future events and the future balance of economic power. Two U.S. analysts, Dr. Wayne Schroeder, of the Senate Defense Appropriations Subcommittee, and Dr. Steven Goldman, of the Department of Energy, published a report in the summer of 1981 indicating that the Soviets are due for a serious energy shortage of their own in the 1980s.32

Schroeder and Goldman point out that it has been U.S. policy to support energy developments in the Soviet Union, in the interest of preserving world peace. They insist, however, that the United States should not buy off the Russians with energy aid. Instead, the United States must deny the Soviets "quick fix" technology transfers. This denial of U.S. energy technology could force Kremlin leaders to shift substantial resources from the military to national energy needs. But in denying the Soviets quick fix technology to expand their production, the United States would have to make it clear that it would defend the Persian Gulf area. It would also have to convince the Persian Gulf states of three things: (1) that Soviet presence there endangers their security, (2) that they defend themselves against the Russians, and (3) that continually raising the price of oil hurts the West’s ability to defend the region.33

As difficult as it may be to determine the correct energy policy with respect to the Soviet Union, deciding on a rational domestic energy policy may be more straightforward.

United States oil imports, which were running 8 million barrels a day in 1979, dropped to about 7 million barrels a day in 1980 34 and then to approximately 4 million barrels a day in 1981. In February 1982 (an atypical month) imports dropped to a seven-year low rate of 2.6 million barrels per day, due to a combination of recession, conservation, and continued conversion to alternative fuels.35 As recently as 1980, the American Petroleum Institute thought that this low a level of imports could not be attained until 1990, even given production incentives advocated by the Reagan administration. Decreased demand, however, appears to have had a stronger than anticipated effect. But a resurgence in demand could turn the situation around: At the same time, the institute predicted that if past policies were continued, along with those that have fostered slow progress in converting to other fuels, imports, instead of dropping by 50 percent (by 1990), could increase by 25 percent or more by that year. The incentives called for in 1980 included the following: the unlocking of federal lands to exploration, reduction of tax penalties on new energy production, oil and gas price decontrol, and the easing of environmental rules. ("It takes roughly 14 years between the time a company applies for permits to begin exploring for new energy resources and when those resources are actually delivered to the end user. Most of the time is chewed up by a maze of regulations.")36

In addition to increasing the supply of domestically produced conventional petroleum in the near-term, it appears that if the United States is to avoid economic and industrial disruption, the nature of petroleum demand must be changed. Two transitions in petroleum use need to take place: (1) A far-term (2000+) switch away from oil for large-scale use, except to provide raw stocks for chemicals and fertilizers, and (2) a nearer-term intermediate transition where the industrialized West makes better use of limited supplies and expands those supplies to provide time for the far-term transition. The near-term transition appears critical. We must ask ourselves, first, if such an intermediate transition can take place at all; and second, if international events will allow space to make it work.

S. Fred Singer, of the Energy Policies Studies Center at the University of Virginia, believes that the first question has a positive answer. The transition may not only be possible but a bit easier than we have been led to think. The key is free market adjustment, over time, to higher prices for commodities. Singer has concluded that technical and economic factors just now starting to be felt will result in three somewhat startling effects by the 1990s:

First—Free world requirements for crude will drop from 50 million barrels a day to 20 million barrels a day.

Second—75 percent of that crude will be refined into gasoline, compared to 25 percent today.

Third—Coal in some form will substitute for most of the fuel oil now used to produce heat or steam.37

What are the underlying causes that may lead to the effects just described? What could work this kind of revolution in the world oil market?

First, Singer indicates that it is now practical to burn "liquid coal"—properly prepared slurries of coal and water—in existing oil-fired boilers with minimum modification. Second, he expects new refinery technology to push gasoline yields from crude oil to 75 percent or higher. Among firms said to have demonstrated such technology or preparing to put it to practical use are Exxon, Ashland, Chevron, and Mobil. Finally, there are the economic factors. Higher prices will encourage both conservation and added production: development of marginal deposits, use of heavy viscous crudes, and drilling of unexploited sedimentary basins. (This already seems to be happening to some extent. The first increase in reserves since 1970 occurred in 1980, followed by a second increase in 198l.)38

According to that analysis, not only will oil be conserved where it must be used, but where substitutes can be used, cost will dictate that they will be. Extensive efforts will be made to substitute coal, natural gas, and other alternatives for fuel oil. At the same time, widening price differentials between gasoline and fuel oil will make it profitable to modify refineries to increase the yield of gasoline from crude oil. The predicted result of these changes, according to Singer, would be effective self-sufficiency for the Western Hemisphere.

We can only speculate as to whether the far-term (2000+) transition will take place, but the near-term transition appears to be a necessity for the maintenance of a vigorous U.S. industrial base. Fortunately, that nearer-term, intermediate transaction does seem to hold promise. The unanswered question remains: Will international events allow space to make it work?

This article makes no attempt to predict the future. If natural caution were not enough to prevent that exercise, the words used by management scholar Peter Drucker more than ten years ago should dissuade such an effort:

. . . human beings can neither predict nor control the future. If anyone still suffers from the delusion that the ability to forecast beyond a very short time span is available to us, let him look at the headlines in yesterday’s paper, and then ask himself which of them he could possibly have predicted a decade or so ago.39

But the article does suggest three things: First, that each passing year will probably bring an increasing level of population-induced misery and unrest to many underdeveloped regions of the world, creating a fertile ground for terrorism, revolution, and war between nations. Second, that the United States is extremely vulnerable in its dependence on foreign sources and supply lines for half of the roughly forty nonfuel minerals necessary to keep its advanced industrial machine operating; but that it may be possible partially to correct this vulnerability through increased domestic production and through stockpiling. However, southern Africa will remain an area, of concern for the United States. Third, although the need has been reduced by recession and conservation, the United States continues to rely on imported oil, as do a majority of its free world allies, but the vulnerability caused by dependence can be reduced. And part of that reduction does seem to be underway, through the operation of free markets and the rationing function of price.

Resource shortages will continue to create an unstable world and a hazardous environment to planners. But attention to the nature of the shortages and actions our country should take to alleviate their worst effects are appropriate concerns for all of us.

Enon, Ohio

Notes

1. The Global 2000 Report to the President: Entering the Twenty-First Century, vol.I (Washington: U.S. Government Printing Office 1980), p. 27. Hereafter referred to as Global 2000.

2. S. Fred Singer, "The Coming Revolution in World Oil Markets," Wall Street Journal, February 4, 1981, p. 26.

3. The Global 2000 Study Report has been both praised (James J. Kilpatrick in "The Coming Catastrophe," Nation’s Business, February 1981, p. 17) and criticized in the press (René Dubos, "Half Truths about the Future," Wall Street Journal, May 8, 1981, p. 22.)

4. Global 2000, p. 1.

5. Thomas Bertelman et al., Resources, Society and the Future, a report prepared for the Swedish Secretariat for Future Studies, translated from the Swedish by Roger G. Tanner (New York: Pergamon Press, 1980), pp. 56-59.

6. Ibid.

7. Global 2000, pp. 1,8-12

8. Ibid., pp. 16-23, 32, 35.

9. Ibid., p. 27.

10. Edgar Ulsamer, "In Focus," Air Force, January 1981, pp.17-19.

11. Ibid. See also: James Hansen, "High Strategic Stakes in Southern Africa," National Defense, May-June 1982, pp. 42-46, and July-August 1982, pp. 42-46.

12. Roger Lowenstein and Maria Shao, "Vital Ingredients," Wall Street Journal, April 15, 1981, pp. 1, 20.

13. Ibid.

14. "According to a recent international convention of geologists, new techniques such as remote sensing, isotope measurements, radiometric dating, and geochemistry are revealing vast reserves of essential minerals on the North American continent." (Dubos, p. 22); also see Ulsamer, p. 17.

15. Hans H. Landsberg et al., Resources in America’s Future— Patterns of Requirements and Availabilities, 1960-2000 (Baltimore: Johns Hopkins University Press, 1963), p. 389.

16. Sam H. Schurr et al., Energy in America’s Future, a study prepared for the Resources for the Future National Energy Strategies Project. Financed by a grant from the Andrew W. Mellon Foundation, 1979, published for RFF by the Johns Hopkins University Press, Baltimore, p. 234.

17. Federal Energy Administration Project Independence Blueprint, Final Task Force Report, Oil: Possible Levels of Future Production (Washington: U.S. Department of the Interior, November 1974), p. II-14. Hereafter referred to as Project Independence.

18. M. King Hubbert, "Outlook for Fuel Resources," Encyclopedia of Energy (New York: McGraw-Hill, 1976), pp. 20-21.

19. The term heavy oil refers to crude oil with low API gravity and high viscosity, which has previously not been economical to extract. Recovery techniques are known, but their application depends on higher oil prices. (Project Independence, p. II-14.)

20. "Tar sands are sedimentary rocks or sands containing a heavy asphaltic substance called bitumen. Characteristics of tar sands vary from one deposit to another with respect to both the host rock and the impregnating material. The sands and rocks have void spaces that are impregnated with bitumen. The impregnating materials vary from semiliquid to semisolid (and in some cases solid) petroleum materials. They range from forms oozing slowly from an outcrop on a warm day to forms difficult to soften in boiling water. Rock types include dolomite, limestone, conglomerate, and shale, as well as consolidated sandstone and unconsolidated sand.

The composition of the rock or sand is mainly quartz, silt, and clay.

Tar sands are known also as oil sands, bituminous sands, and bituminous rocks. Traditionally, they have been treated as a potential petroleum supplement, although in reality the organic material in tar sands is a form of petroleum. The real difference is that tar-sand oil is not producible by the methods commonly used in ordinary oil fields. The bitumen obtained from tar sands is too viscous (5000-50,000 P at 50°F) to be transportable by pipeline without first being upgraded to a lighter, less viscous oil." (Global 2000, vol. 2, p. 199.)

21. "The term oil shale, as commonly used, covers a wide variety of laminated, solidified mixtures of inorganic sediments and organic matter that have the common property of yielding oil (shale oil) upon destructive distillation but are only slightly susceptible to the action of solvents. Shales or hard clays partly or completely saturated with oil from an outside source are not considered true oil shales. Shale oils have extremely complex physical and chemical properties that vary with the type of shale from which they are produced and the conditions under which they are distilled from the source rock." Global 2000, vol. 2, p. 198.

22. Schurr et al., p. 231.

23. Project Independence, p. 11-14.

24. Global 2000, vol. 2, p. 199.

25. Ibid.

26. Ibid., p. 200.

27. Schurr, p. 232.

28. Hubbert, pp. 21-23.

29. Global 2000, vol. 2, p. 198.

30 Ibid.

31. Ibid., pp. 190-91.

32. Leonard Famiglietti, "Two Advise Tight Energy Reins," Air Force Times, July 13, 1981, p. 30.

33. Ibid.

34. "Energy Forecast," Nation’s Business, February 1981, pp. 32-38.

35. Facts on File: Weekly World News Digest (New York: Facts on File Inc., 1982), pp. 110-11. (American Petroleum Institute figures. The Department of Energy at this point was using a figure of approximately 6 million barrels per day.) Based on the API figures, the years from 1977 to 1981 had seen a drop of some 28 percent in OPEC production levels (Facts on File, p. 160).

36. "Energy Forecast, Nation’s Business, February 1981, p. 38.

37. Singer, p. 22; see also Singer’s follow-up article, "What Is Happening to World Oil," Wall Street Journal, March 10, 1982, p. 22.

38. Ray Vicker, "Exotic New Technology Used in Oil Drilling Is Leading to Big Success, A Rise in Reserves," Wall Street Journal, February 28, 1982, p. 23.

39. Peter F. Drucker, "Long Range Planning Means Risk Taking," Long Range Planning for Management (New York: Harper and Row, 1972), pp. 3-19.

40. Global 2000 Report, vol. II, p. 188.

41. Hans H. Landsberg et al., Resources in America’s Future— Patterns of Requirements and Availabilities, 1960-2000 (Baltimore: Johns Hopkins University Press, 1963), p. 389.

42. M. King Hubbert, A National Fuels and Energy Policy Study, U.S. 93rd Congress, 2d Session, Senate Committee on. Interior and Insular Affairs, 1974, as found in M. King Hubbert, "Outlook For Fuel Reserves," Encyclopedia of Energy (New York: McGraw-Hill, 1976), p. 16.


Contributor

Leonard Gaston (B.S., Texas Tech; M.B.A., Ph.D., Ohio State University) is an operations research analyst with the Deputy for Development Planning, Aeronautical Systems Division, Air Force Systems Command, Wright-Patterson AFB, Ohio. He is also an Air Force Reserve officer, formerly with an Individual Mobilization Augmentee assignment to the Directorate of Aerospace Studies, Kirtland AFB, New Mexico.

Disclaimer

The conclusions and opinions expressed in this document are those of the author cultivated in the freedom of expression, academic environment of Air University. They do not reflect the official position of the U.S. Government, Department of Defense, the United States Air Force or the Air University.


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