United States coal reserves are taking a beating in a new examination by the USGS of recoverable reserves of Gilette in Wyoming, the largest field in the US with 37% of total coal production in 2006. Its present reserves have been downgraded by half thanks to an improved methodology which incorporates a new dataset with ten times as many datapoints as used in the previous assessment. Of 182 billion metric tonnes of resource in place, 9.16 billion (6% of original resource total) were found to be recoverable under "current technological and economic circumstances". This compares to an earlier assessment from 2002 by the USGS in which 20.87 billion metric tons were estimated to be recoverable.

The one catch is that the term "present economic circumstances" depends very much on the price of coal. If the price of coal increases significantly, the newly estimated reserve level of 9.16 billion metric tons can be expected to increase, perhaps several-fold. Although the USGS takes a shot at determining the price-sensitivity of reserves by discussing its effect, there still are a lot of open ends. Nonetheless the economic aspect of coal recoverability should be taken seriously; hence the question mark in the title.

The new USGS assessment does show that the statement made by the US National Academy of Science two years ago, that US coal reserves are likely overstated, should be taken seriously. The National Academy of Science concluded at that time that coal recoverability estimates are based on outdated assessment methods--these methods have not been reviewed or revised since 1974 and primarily reflect input data from the early 1970s.

More information on the USGS study, including estimates by the US of the effect of changing economic conditions on coal availability in Gillette, can be found below the fold. The study itself is available through this weblink (Beware! 92 megabyte, 123 pages)

I find this paper very disappointing, especially coming from someone of King’s calibre and position. It shows no original thought, preferring to cite the IEA, the USGS and historically static reserves-to-production ratios. It also shows no appreciation for flow rates or declining production from fields already in production, explains lack of new discoveries by low levels of exploration in the Middle East and attempts to square the development of unconventional oil sources with "radical reductions" in greenhouse gas emissions. King ends by saying hydrogen and fuel cell technologies have the potential to replace oil for transport. I'm left feeling King has presented a politician’s view rather than a that of a scientist.

The paper is probably the best indication we have to government's official position on the matter.

It is unclear how King's view as expressed in this paper relates to a conversation he had with David Strahan (author of The Last Oil Shock, link) in 2005 where King is reported to have said peak oil "in ten years or less".

Professor Sir David King, Chief Scientific Advisor to the UK Government

His full submission is reproduced below the fold.

This post is the second part in a three piece series about the phenomenon of reserve growth in already found oil fields. Insight in future reserve growth, which is often attributed to advancement in technology, is crucial in determining the peak of conventional oil production. For those not familiar with reserve growth it would be best to read part 1 first:

1. General introduction to reserve growth, what can we learn from the worldwide recovery factor of conventional oil fields?

In this second part various scientific studies about reserve growth in the United States, the North Sea and Russia are analysed. The third part will look at the reliability of the estimate from the United States Geological Survey in their World Petroleum Assessment 2000 with respect to future reserve growth.