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The True Cost of Oil

Special to The Green Register by Kyle Crider, Manager – Environmental Operations, Ecotech Institute

“Crude oil output reaches an undulating plateau of around 68-69 mb/d*, by 2020, but never regains its all-time peak of 70mb/d reached in 2006.” ~International Energy Agency, World Energy Outlook 2010, November 2010

In case you missed it, the quote above was the International Energy Agency (IEA)’s admission that the world probably hit “peak oil” in 2006. It is helpful to remember that the IEA is not known as an alarmist or progressive-green agency; quite the opposite, in fact. So when the IEA admitted not only that we have hit peak oil, but also that our present use of fossil fuels has us on-track for catastrophic 11°F global warming, many of us were taken aback.

What does “peak oil” mean, anyway? It simply means that, regardless of how much oil is left in the ground, we have already pumped all the easiest and cheapest oil out. The remaining oil is more expensive to extract and refine, hence we are unlikely to ever produce as much of it again as when it was easier and cheaper. Also, the remaining oil is more dangerous to extract—to us and the planet—because it is located in Polar Regions, deep undersea, and other extreme, environmentally-sensitive areas.

Thanks to our addiction to big, inefficient buildings and engines, the fact that this remaining oil is expensive, dangerous, and environmentally destructive to extract does not deter those who are making record profits squeezing every last drop from the most unyielding nooks and crannies of our planet. Today’s most visible post-peak oil fight is over the Athabasca oil sands in Alberta, Canada—and the proposed Keystone XL pipeline that would bring this product to the Gulf Coast. The Keystone XL pipeline would cross our nation’s heartland and breadbasket, including the nation’s largest underground aquifer that waters this farmland. Most of this very “crude” form of oil is not even intended for our use here in the U.S.; we’re simply the conduit to shipping ports and emerging nations hungry to fuel their economic growth the same way we did—by burning irreplaceable natural capital. What are mistakenly labeled as fossil-fueled economic growth and profits in actuality are the one-time proceeds of a planetary fire sale, and the smoke is beginning to accumulate.

If you’ve been hearing all the hoopla over the Keystone XL pipeline and wonder just what the deal is, I encourage you to watch this moving TED talk by Canadian Garth Lenz on “The true cost of oil.” If the jarring juxtaposition of almost surreal, pristine natural beauty and frightening Mordor-like mining devastation doesn’t affect us, then perhaps we’ve become more orc-like as a race than we would care to admit.

“What the hell did we do to deserve this?” BP CEO Tony Hayward, speaking to fellow executives in London about the Gulf oil spill disaster, May 2, 2010

*Million barrels per day

Kyle Crider is Manager – Environmental Operations at Ecotech Institute and Education Corporation of America. He holds a Master of Public Administration degree with a double-emphasis in Urban Planning & Policy Analysis. He is also a Leadership in Energy and Environmental Design Accredited Professional, Neighborhood Development (LEED AP ND). He is currently in the Interdisciplinary Engineering Ph.D. Program at the University of Alabama at Birmingham. The opinions expressed in this blog are those of the author and not necessarily those of Ecotech Institute or Education Corporation of America. Email Kyle at