In 1939 the Department of the Interior in the U.S. predicted that America’s oil would run out within 13 years. I didn’t, but nevertheless the selfsame prediction was made in 1951: 13 years left!

In 1972 the global bestseller book Limits to Growth provided two alternative predictions for when we run out of various natural resources. These forecasts, which were based on a huge computer model created at Massachusetts Institute of Technology, concluded that we in a pessimistic case would run out of oil by 1994, gas by 1996 and coal by 2083. A more optimistic case predicted that we instead would run out in 2023, 2024 and 2122, respectively. We have already passed the more pessimistic deadlines for oil and gas and are now rapidly closing in on the deadlines for the more pessimistic cases.

So how do the forecasts look now? - When will we run out of energy? Are we now reaching the end of oil, for instance? To be more specific, there should be enough oil for maximum 12 years and enough gas for 13 at the most.

For how long will oil last?

We already know now that we have much more oil than predicted in the models presented in Limits to Growth. For instance, proven conventional oil reserves as of 2011 is approx. 1.4 trillion barrels (1,400,000,000,000 barrels), compared to daily consumption of just under 90 billion barrels, or approx. 33 billion barrels per year. This means that if consumption remains unchanged and reserves don’t grow, we will have enough for another 42 years and will thus run out around year 2053. Of course, at least over the next few decades, demand will grow, but we will also keep making new discoveries.

However, this is only a small part of the picture. In addition to the 1.4 trillion barrels of conventional oil, we also have oil sand, which contains a form of oil that looks like tar and which is deposited close to the surface and typically embedded in clay or sand. Another way to explain it is that it is a traditional oil field which has been pushed up the surface by natural geological forces and which is in the process of very slowly evaporating/fermenting. Most of this is located in Canada and Venezuela, which between them probably have approx. 3.6 trillion barrels of recoverable sand oil. That is equivalent to 122 years’ global oil consumption at current rates. Especially the Canadians are already processing this in very large scale.

But there is more oil than that. So-called shale oil is the results of old organic material that never sank deep enough to decompose into oil. Instead it turned into kerogen which looks like rock, but can burn (but is never the less called oil shale or shale oil, even though it neither contains oil nor shale). In total it is now estimated that there is 2.8–3.3 trillion recoverable barrels of shale oil, with the largest reserves in the United States, which is thought to have 1.5–2.6 trillion barrels – mainly in the Rocky Mountains. If we for simplicity assumed that there are 3 trillion barrels in total, this would be equivalent to approx. 90 years at current consumption rate. So to put it all in perspective, if we add up known conventional oil, oil sand and shale oil, we have enough for approx. 42+122+90 = 254 years. Even assuming massive increase in oil consumption we would surely be able to keep going throughout this century.

However, it doesn’t end there either. It is possible to convert coal to oil, and the most recent estimates of our coal reserves conclude that they will last approx. 270 years or so. And it is also possible to convert gas to oil, which brings me to the next big change in the global energy infrastructure: The age of gas.

The coming transition gas revolution

To put it very simply, we have gone through 3 phases in energy so far: 1) wood, 2) coal and 3) oil. Wood is highly impractical and contains limited energy per weight unit. Coal is more practical and oil even more so, as it is a fluid that can be piped and pumped.

There is another aspect which makes oil more attractive than coal and coal better than wood: the carbon to hydrogen ratio. When we burn something, what we are interested in is hydrogen. This is where we get the energy from; the process where hydrogen combines with oxygen and where energy is released as a consequence. We are not interested in carbon; this is just something that comes along as a by-product and which combines with oxygen to create CO2. In essence the carbon is the matrix that contains the hydrogen as this doesn’t exist in its free form in nature (since it is extremely reactive). Wood contains vast amounts of carbon compared to its hydrogen and when you burn wood, it smokes a lot. Coal contains less carbon, but there is still typically two coal atoms for each hydrogen atom in it.

Oil is in this sense four times cleaner than coal, since it contains two hydrogen atoms for each coal atom. But gas is cleaner still; it contains four hydrogen atoms per carbon atom, which means that it is eight times as clean as coal in that respect. Eight times is evidently a lot. Gas is our most important “clean energy” resource for the coming decades. While use of alternative energy technologies such as solar panels and windmills will surely continue to grow very rapidly, they will not make much of a difference at all, when seen in the big picture. Also, people will begin to realize that they aren’t necessarily that “clean”. For instance, the average lifetime of a windmill is 20-25 years, and then it has to be dismantled. But what do you do with the huge cement structures? And how do you dispose of the enormous fibre glass wings? Apart from the tens of thousands of birds killed by windmills each year, the dismantling of them may become an environmental disaster.

But how much gas do we have? I already mentioned that according to Limits to Growth, we should run out somewhere between 1994 and 2024. So maximum 13 years left.

This will not happen. The International Energy Agency recently doubled its estimates of how much gas we have so that they now believe that we have enough for – 250 years! Yes, twohundredandfifty. The main reason for that is what goes on in so-called shale gas.

Shale gas extraction

Shale is fine-grained sedimentary rocks. In the oil and gas industries it has been well known for decades that these rock formations can contain oil and gas. For instance, if one had to drill through shale to get to an oil field below, one would often encounter so-called “shows” in the form of brief bursts of gas. However, because the rocks were so tight, it was until recently assumed that shale oil and shale gas could not be recovered commercially.

However, that has now changed. A fairly new set of technologies called “fracking” involve first drilling down vertically, then turning the drills horizontal underground, perforating the horizontal pipe casing with small explosions and finally pumping water with sand through the holes at extremely high pressure. This creates a huge number of tiny cracks in the surrounding rocks, which are subsequently kept open by the sand particles. The gas can now flow through these cracks and to the surface. The same methods can also be used for extracting methane from coal seams.

The commercial implications are huge. The cost of extracting shale gas is coming down very quickly and is already going below the cost of much of our conventional gas exploration. So far we have discovered major shale gas basins in North America. Europe, Asia, South America, Australia and Northern and Southern parts of Africa, and countries that may in particular benefit vastly include USA, Canada, Brazil, Argentina, Poland, Germany, Holland, France, Hungary, Romania, Australia, South Africa, Libya, Algeria, China and India. Unlike conventional oil and gas, the unconventional resources of both are predominately located in democratic nations.

Coming up: 3rd and 4th generation bio fuel

Of course, even if we keep identifying useful fossil fuels faster than we burn them as we have done for hundreds of years, there are concerns about the amount of CO2 that we emit in the process. The solution to this is to do two things what mankind has done time and again in other industries:

• Replace the concept of extracting stuff from nature with synthesising it.
• Replace crude mechanical processes with innovation in information technology and at the atomic level

Somehow it seems intuitive that our final answer to energy will come from those approaches. We already know some of the ways it might be done: 3rd and 4th generation bio fuel. A number of companies are now working on creating modified microorganisms that can effectively capture CO2 and excrete oil. In order to do those modifications we need to be able to analyse and synthesize DNA extremely efficiently, but we have actually reached that stage now. These technologies will not as such lead to reduction of our CO2 in the atmosphere, as CO2 re-enters the atmosphere, when the oil is burned. But they will be CO2 neutral.

I mentioned earlier that oil is more practical than coal because it can be pumped and has a higher energy density. In fact electric power is even more practical since it flows directly to a number of devices in our factories, offices and households, where it can be turned on and off with great ease, which is why we convert the energy in coal and gas to electric power. However, for cars and in particular for aircraft, a fluent fuel is really very practical compared to batteries, so biofuels will be very useful even in a very futuristic world.

It will surely take many years to get from where the new biofuels are now (laboratory stage) to meaningful commercial production and even more years to get the prices down so that they can really compete against fossil fuel. However, if and when we do it, the US would, for instance, be able to create its entire supply of fuels from approx. 0.5% of its landmass. Welcome to never-ending oil.

The ultimate energy solution

If information technology and atomic manipulation is the ultimate answer the energy challenge, the ultimate prize would be nuclear fusion. One reason to think that we will get this one day is that there is a tendency within technology that everything which is desirable and which can be done in principle, will sooner or later get done on reality. Nuclear fusion works in principle on Earth and in praxis in the sun and other stars and is hugely desirable. However, so far, this has turned out be the biggest engineering challenge of all times, and one of the most expensive ones too, which is why there is a saying that “nuclear fusion is 40 years away, and it always will be”.

Having said that, clear progress is actually being made in the various experimental plants such as National Ignition Facility in California, and this year Jeff Bezoz of Amazon.com and other invested in the company General Fusion, which hopes to be able to demonstrate working nuclear fusion within just a few years.

If indeed we can make nuclear fusion work in industrial scale, it will arguable change the world like few other technologies ever has. In understanding its importance, think the use of fire or the internal combustion machine. Why? Because nuclear fusion will be very clean, perhaps cleaner than any other energy technology including gas, windmills and solar panels, and with it, we will have resources to power the Earth for 150 billion years – 10 times as long as the universe has existed. The implications for our economy, environment and global politics will be massive.

So where are we?

My best answer to it all is that energy markets will be tight for the coming decades, but that we will in fact never run out of energy resources. On the contrary, they will continue to grow until reaching the point of being for all practical purposes unlimited. As for why markets may be tight the coming few decades the reason is obviously the expected enormous growth in emerging market economies. Global GDP grew approx. 500% in real terms during the 40 years from 1970 to 2010 and seems poised to grow at least 400% over the next 40 years – until 2050. The reason this growth may be slightly less than before is that global population will grow much less than it did before – it has decelerated almost every year since 1963. However, in terms of sheer volume, because the global economic base is much larger now than in 1970, the actually growth will be around four times as big in the next 40 years as it was in the previous 40. That will require absolutely huge quantities of energy. Until we see great breakthroughs on nuclear fusion and/or 3rd/4th generation biofuels, gas will be the main answer.