Matt Mushalik from Australia was good enough to send me this graph of world oil exports, calculated from new oil data provided by the EIA.

Figure 1. World net exports, based on EIA data

This inspired me to put together a few other somewhat related graphs, relating to oil exports and US imports. Since Canada is such a tiny piece of world exports, but seems to be mentioned as a possible major source of future US imports, I have looked at it separately as well.

The likelihood of a huge ramp up in imports from Canada seems remote. Canadian exports to the US require continued imports to the East Coast of Canada. If imports of oil to Canada decline as world exports decline, US oil imports from Canada may also decline, because ramped up production from oil sands may not be enough to offset declines in production and imports elsewhere.

In August 2007, a post titled Extracting Heavy Oil: Using Toe to Heel Air Injection (THAI) introduced readers of The Oil Drum to a technology for producing an upgraded extra-heavy oil from Alberta Tar Sands without the environmentally messy and energy-intensive surface mining procedures that currently dominate extraction. The post provided a first-look at producing and partially upgrading Alberta bitumen in situ. In this post we make preliminary estimates of the Energy Return on Investment (EROI) of the THAI process.

The Alberta Tar Sands continued to garner interest through the first half of 2008 because of declining conventional oil production in Canada, the apparent success of the Steam Assisted Gravity Drainage (SAGD) process and the increasing price of crude oil. Today they are still of interest as the countries of North America (and around the world) desire cheap, abundant crude oil from politically stable regions (See Unconventional Oil: Tar Sands and Shale Oil - EROI on the Web, Part 3 of 6). However the subsequent financial collapse during the second half of 2008 has caused many tar sand projects to be deferred. In fact, Canada's oil-sands industry has hit the skids, spreading a deepening gloom over Alberta's economy, and to some degree, across the country. Some expansion projects that were under way in the Fort McMurray region have been put on the shelf, as oil companies slash their budgets to reflect the new economic environment in which they operate – that is – a world of lower oil demand and, at least compared to the summer of 2008, low oil prices.

This is third in a series of six guest posts by Professor Charles Hall of the SUNY College of Environmental Science and Forestry describing the energy statistic, "EROI" for various fuels. As has been discussed often on this site, net energy analysis is a vitally important concept - just as we primarily care about our take home pay which is our salary minus the taxes, we should care about our 'take home' energy, which is what is left after energy costs have been accounted for. As important as it is, this measure is not easy to quantify, as: a)data is almost always measured in $ as opposed to energy terms, b) parsing non-energy inputs (and outputs) into energy terms is difficult, and c) analysis boundaries (including environmental impacts) are very disparate. As such, there is not (has not yet been) a consistent formula for EROI applied to all energy studies that has led to policymakers and analysts speaking the same language in useful ways. The lead paper in this months Royal Academy of Sweden's journal AMBIO will be about such an EROI framework, and we will link to it when it comes online.

Professor Hall has been working in this area for over 30 years. Below are net energy analysis from Hall's group on the unconventional oil sources from tar sands and oil shaletwo resources that theoretically are enormous in energy scale, but practically are limited by flow rates, costs, and externalities. Just how limited is the subject of todays two-part informative post is below the fold. Remember, any specific numerical help via referenced literature, personal experience or knowledge to better inform Dr. Hall and his students would be appreciated.

In her new book The Shock Doctrine: The Rise of Disaster Capitalism, Canadian writer Naomi Klein uses the example of public sector dismantling in both New Orleans and Iraq as an illustration of Milton Friedman's idea that crisis presents an opportunity to push a pre-existing agenda and achieve sweeping change. This is both an important point and a timely warning, as the developing international credit crunch is arguably approaching a critical phase. The inability to roll over short term commercial paper, often backed by dubious loans, is presenting an enormous challenge to a banking system short of cash. The coming economic upheaval could be sufficient to precipitate far-reaching socio-political changes on a global scale.

On the energy front, CIBC World Markets claims that Canada has 50-70% of the investable oil reserves in the world, for oil majors increasingly shut out of producing regions. However, those reserves suffer from a shortage of pipeline capacity for both inputs and output. Saskatchewan decides against 'clean coal' on cost grounds, but continues to maintain a low royalty, low tax regime for natural resources. In the meantime, the Canadian wind industry is being consolidated in fewer and fewer hands, and there is strong resistance to uranium mining in rural Ontario.

As for environmental news, Holland is developing a 200 year plan for climate change, but with the assumption that sea-levels will rise very little despite evidence of rapid change in Greenland's icesheets. There is considerable concern over the potential for warming to activate microbial oxidation of the organic matter of the arctic tundra, which could ignite a devastating spiral of positive feedback.

Naomi Klein: The Shock Doctrine

In one of his most influential essays, Friedman articulated contemporary capitalism's core tactical nostrum, what I have come to understand as "the shock doctrine". He observed that "only a crisis - actual or perceived - produces real change". When that crisis occurs, the actions taken depend on the ideas that are lying around. Some people stockpile canned goods and water in preparation for major disasters; Friedmanites stockpile free-market ideas. And once a crisis has struck, the University of Chicago professor was convinced that it was crucial to act swiftly, to impose rapid and irreversible change before the crisis-racked society slipped back into the "tyranny of the status quo". A variation on Machiavelli's advice that "injuries" should be inflicted "all at once", this is one of Friedman's most lasting legacies....

....I started researching the free market's dependence on the power of shock four years ago, during the early days of the occupation of Iraq. I reported from Baghdad on Washington's failed attempts to follow "shock and awe" with shock therapy - mass privatisation, complete free trade, a 15% flat tax, a dramatically downsized government. Afterwards I travelled to Sri Lanka, several months after the devastating 2004 tsunami, and witnessed another version of the same manoeuvre: foreign investors and international lenders had teamed up to use the atmosphere of panic to hand the entire beautiful coastline over to entrepreneurs who quickly built large resorts, blocking hundreds of thousands of fishing people from rebuilding their villages. By the time Hurricane Katrina hit New Orleans, it was clear that this was now the preferred method of advancing corporate goals: using moments of collective trauma to engage in radical social and economic engineering.