Wednesday, October 7, 2009

On Oil

A long time ago I saw this movie with William H Macy called The Water Engine. Based on David Mamet's 1977 play, it's the story of an inventor who has created a carburetor that runs on water. When he tries to patent the engine things start to go wrong. Even though it was set in the 1930s, there was still this push to make sure that oil was the primary fuel source. Eventually the inventor is killed and the engine itself is lost thanks to the oil companies. It was an interesting story about how a naive inventor thought he could just create something that would change the world. He didn't realize that some people don't want the world to change.

The next time I saw something about the water engine was in the short-lived X-Files spin off, The Lone Gunmen. They were searching for the mythical water-powered car. And the end of the episode the person they thought was helping them was working to make sure the water engine never was given to the public. Her motives for doing this weren't as monetarily based as the oil companies in the movie. Instead she was keeping the water engine a secret because imagine a world where cars run on water. It seems like a great idea in theory. Our primary source of fuel is based on something from a few hundred million years ago and when we run out, there isn't any more. With about 70% of the Earth covered in water it would seem like an almost endless source of fuel. So what would our oceans, lakes, and rivers be like if we were trying to feed our cars and machinery? It's predicted by 2020 there will be over a billion motor vehicles on the planet. Imagine if they all ran on a cheap fuel that ran clean? There could be double that in half the time. Maybe an engine that runs on water isn't such a great thing after all.

In 1999 Honda released its first hybrid car called the Insight. Its fuel efficiency was rated as high as 70 mpg on the highway. Ten years later and the highest numbers come from the Prius and Civic. The Prius at 48 mpg actually gets better mileage in the city than the Civic's 45 mpg highway. Most other hybrid cars can barely top out at 40 mpg. It's 2009. How is it that we're supposed to be excited that a hybrid can barely get 40 mpg? The automobile has been around for 140 years and the absolute best we can look forward to is 48 mpg. Something about that just seems wrong. Shouldn't the numbers be higher already?

I'm not an oil baron (if they even still have those anymore) so I can't really understand what it's like to have everything I own based on the profit of oil. Still oil production in America is over a 150 years old. There is potentially a lot of oil left to squeeze out of the Earth. Those who are making billions today will most likely continue to make billions tomorrow. The part I can't figure out though is why it seems like both the automotive manufacturers and oil companies (I guess energy companies might be more accurate) are dragging their feet when it comes to new technology. Given the resources of someone like Exxon, shouldn't they be leading the charge when it comes to new technology? And not just in oil refinement, but modern energy. Imagine if Shell Oil created some new kind of fuel cell that reduced our need for oil? Notice I didn't say ended our need. Reduced. Anyone who thinks that oil usage is going to go away anytime soon is deluding themselves. And maybe that's where the feet dragging comes from. Oil companies fearing that if they revolutionize fuel efficiency they'll essentially be killing their profits. I suppose it's the safe play to just keep doing what worked for the last century rather than innovate. Problem with that is eventually the need for oil will go away, either because we just don't have enough or because some other fuel comes along. When that happens those who cling to the old ideas are going to get crushed in the switch.

It's interesting that Mamet wrote his play not too long after the Emergency Highway Conservation Act was passed. This is what gave us the speed limit of 55 mph. The speed limit acting as a band-aid to the oil crisis of 1973 where OPEC essentially decided to stop sending us oil. Combined with the stock market crash there was a sort of panic that things were crumbling. In an attempt to make sure the oil on hand could last as long as possible gas rationing was implemented. Even with this there were lines and stations without fuel. This was in the early 70s. If people were panicking then what's it going to be like tomorrow? There's less oil now than 30 years ago.

There's this thing called Hubbert peak theory that predicted United States oil production would peak between 1965 and 1970. After that it would be harder to produce petroleum and there would always be less of it. There was criticism of this theory because it tended to be too simplistic and thanks to the strict gas rationing Hubbert's original numbers were off. The general idea holds true, even if the date isn't exact. The guy wrote his original paper back in 1956. Even then he understood what was coming. As predicted we reached our peak and ever since have been on the decline.

Fifty years ago it was predicted that oil production would begin to fall. Thanks to his handy little bell curve graph it looked like the very end of oil wouldn't be for another 200 years. Apparently that is reason enough to not move very fast on coming up with some alternatives. If you're an oil executive you know that with 200 years to spare even your great great grandchildren can be rich off oil.

The problem is just because there's a drop of oil left in the ground, doesn't mean it's going to be easy to get to. If everyone else is running off the same information then they have to know before too long it'll be worth fighting over. We're fighting over oil interests now and according to the charts we still have a couple centuries before things go completely dry. What's it going to be like when we're on the downward slide of that bell curve and the peak is a distant memory to anyone still alive? I guess we can look forward to the Texaco Army in a stand off with the British Petroleum Militia.