www.PDHcenter.com www.PDHonline.org River of Oil Table of Contents Slide/s Part Description 1N/ATitle 2 N/A Table of Contents 3~63 1 Running on Empty 64~100 2 Native Wealth 101~191 3 One If By Land 192~266 4 Two If By Sea 267~284 5 Three If By Air 285~346 6 Touch the Earth Gently 347~434 7 Safeguarding the Future 435~514 8 Wild Alaska 515~631 9 JFWAT 632~706 10 Trial & Error 707~804 11 Concern No. 3 805~856 12 The Report Card 857~919 13 Turning On the TAPS 920~950 14 A Never Ending Story The Trans-Alaska Pipeline 1 2 Part 1 Dead Serious Running on Empty 3 4 “‘Anyone who buys who buys one of those big gas-eating cars has got to be out of his mind,’ said the man sitting across the desk from me. For a moment, I couldn’t believe my ears. I’ve heard that kind of talk before, but always from professional car-haters. This time, thougg,h, it was coming from one of the top executives in the oil industry - he doesn’t Trouble Ahead want his name used for obvious reasons - whose livelihood depends on selling lots of gasoline to power lots of cars. But he was dead serious, and he has lots of company…” Popular Science, April 1973 5 6 © J.M. Syken 1 www.PDHcenter.com www.PDHonline.org “…In several weeks of interviewing experts on energy in general and the oil industry in particular, I got nothing but predictions of desperateldesperately hard times ahead for America’s What Kind of Trouble? auto owners. You’d better get ready for trouble…” Popular Science, April 1973 7 8 “…If the experts are right, you’d better brace yourself for some kind of gas rationing, maybe as early as this summer. “…For one thing, higher prices - and not just a few cents a That’s no typographical error: Gas rationing, perhaps this gallon, either. Almost everyone in the industry thinks the year, is what the experts expect. The optimists think it will be price of gasoline is heading straight up. Before this decade is informal rationing, when you drive up to the gas pppump and out, you could well be paying anywhere from 80 cents to one the attendant says, ‘Sorry, Mr. Jones, I can only give you dollar a gallon for your gas. If you can get it, that is…” eight gallons today.’ The pessimists look for government- Popular Science, April 1973 imposed rationing, where the amount of gas you’re allowed to buy will depend on how essential your work is…” Popular Science, April 1973 9 10 “…‘It’s going to be formal rationing and it’s going to be soon,’ says Gerard C. Gambs, a vice-president of the consulting firm of Ford, Bacon & Davis, whose study of energy needs goes back 25 years. ‘I don’t think the government can allow informal rationing because there just isn’t enough gasoline to go around.’ John F. O’Leary, an energy expert who is now Sooner Rather than Later Director of Licensing of the Atomic Energy Commission and has been Deputy Assistant Secretary of the Interior for Energy Resources, Director of the Bureau of Mines, and Director of the Bureau of Natural Gas, says, ‘With 100 million inefficient cars on the road, we may face national rationing this year’…” Popular Science, April 1973 11 12 © J.M. Syken 2 www.PDHcenter.com www.PDHonline.org “…In short, the people who study oil supply and demand are telling you to stop thinking of gasoline of something that is cheap and plentiful, and start thinking of it as scarce and Supply & Demand expensive.You may have trouble making that adjustment because the change has happened almost overnight - but if you don’t adjust, it’s going to hit you hard in the pocket- book…” Popular Science, April 1973 13 14 “…And if you think it can’t happen here, think again. It is Think Again happening here, right now. Consider these developp,ments, all reported by the nation’s newspapers last winter…” Popular Science, April 1973 15 16 “…Public schools in Denver and Wichita had to close for lack “…Three major airlines flying out of New York - American, of heat, even though their suppliers offered to buy fuel oil Trans World, and Allegheny - were sending flights up with from anybody at any price. It took the combined efforts of the tanks only part full, because there wasn’t enough aviation Office of Emerggyency Prepp,aredness, the Interior Depp,artment, fuel to go around. Some normally non-stop flights had to and the Colorado Public Utilities Commission to get enough make intermediate stops in order to refuel. At one point the No. 2 oil - the kind you heat your home with - to reopen the Interior Department had to release imported jet fuel held in Denver schools part time…” bond to prevent a partial shutdown of New York’s airports…” Popular Science, April 1973 Popular Science, April 1973 17 18 © J.M. Syken 3 www.PDHcenter.com www.PDHonline.org “…Some major oil companies were rationing supplies. Stand- ard Oil of Indiana told its customers in the Midwest that it could give them only 75 percent of what they wanted. Shell Oil Company was turning away all new customers, while limiting regular customers to the supplies they got last year. A Ravenous Demand Texaco was rationing almost all its fuel oil, as well as diesel and aviation fuel, because of what it called ‘unprecedented demand on the dwindling domestic crude oil production’…” Popular Science, April 1973 19 20 “…Grain shipments on Midwest waterways were stopped because ships couldn’t get the oil to move them. This was no phony shortage caused by a strike or other temporary prob- lem - it was a simple failure to produce enough to meet de- mand. In one typical week last winter, nearly 21 million barrels of No. 2 oil were produced, up from 18.9 million barrels the year before - a hefty increase, the best that oil companies said they could do, but not good enough to meet The Harbinger a ravenous demand…” Popular Science, April 1973 RE: in 2005, the U.S. produced an average of 5.4 million barrels of oil-a- day - a little more than half of what it was producing in the mid-1980s. The top three oil-producing areas in the country are the Gulf of Mexico, Texas (onshore) and Alaska’s North Slope. Only the Gulf of Mexico was ex- pected to increase output, but the impact of Hurricanes Katrina and Rita hindered productivity. The storms damaged 183 pipelines and destroyed 115 platforms. 21 22 “…An average garbage refinery would start switching from “…Last winter’s shortages of fuel oil are a harbinger of this its winter balance of 35 percent gas and 65 percent distillates summer’s gasoline shortages. In the ordinary routine, a typ- as spring grew near, moving to a 50-50 ratio to build up gas ical refinery - what people in the oil business irreverently call stocks for peak summer travel demand. But instead of a ‘garbage refinery’ to distinguish it from one tailor-made to cracking heavier distillate molecules into lighter gasoline produce asingle specialized product - has about a15 percent molecules, the averageg refinery this winter was frantically swing in its end product; that is, it can produce anywhere turning out all the distillates it could, to keep jet aircraft flying from 35 percent to 50 percent gasoline, depending on and factories running. The result: no buildup of gasoline demand, with the balance going into the wide variety of stocks, and trouble coming this summer. To repeat, this is no products collectively called distillates…” fluke. The oil we need isn’t there for the taking. Shortages are Popular Science, April 1973 here to stay…” Popular Science, April 1973 23 24 © J.M. Syken 4 www.PDHcenter.com www.PDHonline.org “…How did it happen? How did an oil-rich nation suddenly become oil-poor? The short-term explanation for our short- age is a combination of trends, all bad, that have suddenly converged - in economics, in environmentalism, in technol- ogy. Just about everything that could go wrong has gone wrong, putting us in a short-term bind. But there’s a more menacing long-term explanation: We (first asanationand How? ultimately as a planet) are running out of oil. The petroleum industry used to get a gusher of oil by turning a tap. Now the gush is becoming a trickle. Sure, there’s enough crude oil underground to supply the world for maybe a century, but too much of it is in the wrong place as far as the U.S. is con- cerned. The good old days are over…” Popular Science, April 1973 25 26 “…That’s true of every form of energy we use, but problems with oil will hit you hardest because oil is both very important and very personal. Half of all the energy used in the United States comes from oil, and half of that oil is used for Domino Effect transportation - most noticeably, the family car. Your coming problems with that car stem in part from trouble with electricity and natural gas…” Popular Science, April 1973 27 28 “…If you haven’t noticed, we’re running out of natural gas. Reserves dropped by 7.1 percent in 1971, the fourth straight year in which the U.S. used more gas than was discovered. “…Among those scrambling to buy fuel oil are the electric ‘Last year,’ says James Jensen, a senior staff member at utilities, who find themselves in a double bind: not only are Arthur D.