As my two regular readers have noted, Sowell's Law Blog has favorite themes, including Global Warming (it is a non-issue), Nuclear Power (they are all uneconomic and unsafe), Energy Supplies (renewables are growing fast), Fresh Water (too much in many places, not enough in others), Legal Issues (science, technology, First Amendment, engineering, energy, and many others). There are others, of course. President Trump already has announced policies that will impact many of these.
This article discusses one of the important areas of a Trump presidency: the use of a huge oil discovery in West Texas, the Wolfcamp shale oil, and domestic and foreign policy.
(A big note up front: Wolfcamp oil was discovered decades ago. The technology for economically extracting the oil is fairly recent, with precision directional drilling (PDD) and hydraulic fracturing. In fact, in 2013 an excellent article appeared in Oil and Gas Journal. This means that President Obama must have known of the huge oil reserves at Wolfcamp, and did nothing with that information.) see link to OGJ article "Wolfcamp shale graduates to 'world class' play"
The oil in Wolfcamp is estimated at 20 billion to 50 billion barrels. USGS announced last week that 20 billion barrels of oil exist in the "new" Wolfcamp reservoir.
The US imports less oil now than in years past, with approximately 8 million BPD at present compared to 11 million BPD in 2005. (US EIA weekly petroleum status report). Total crude runs to refineries today is approximately double that, at 16.1 million BPD. However, the recent imports from Middle Eastern countries were approximately 2 million BPD. Mexico provides approximately 0.6 million BPD.
It would not be difficult to stop imports from the Middle East, and produce that oil from Wolfcamp. That would require 2 million BPD of Wolfcamp production above and beyond its present production. The Wolfcamp oil would flow for more than 50 years at that rate. However, stopping imports from Middle East region would have a significant impact on the world energy market. The first result would be a large drop in crude oil price. Oil producing nations would be most unhappy, if not furious. Russia would be one of the furious ones. However, oil importing nations would be very happy, if not ecstatic. Those countries would include Japan, South Korea, China, India, Italy, France, and (soon) UK.
As to Mexico, it would not be difficult to stop imports of Mexican oil (600,000 BPD as above) and use Wolfcamp oil instead. The impact on Mexico's economy would be severe, potentially resulting in economic collapse and chaos. President Trump could very easily require Mexico to build a wall in exchange for continued oil imports.
The implications are numerous for having a huge oil reserve that the US could easily exploit. Furthermore, the Wolfcamp oil is not the only such oil field in the US.
These are very interesting times in which we live. Very interesting.
Roger E. Sowell, Esq.
Marina del Rey, California
copyright (c) 2016 by Roger Sowell, all rights reserved.