Government's Estimate of Available Oil Under California Was Off by 96%

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The Energy Information Administration (EIA) has reportedly cut the amount of shale oil gas expected to be retrieved from the Monterey reserves in California, saying that earlier estimates overshot by quite a bit — about 96 percent. There goes our energy independence plan. 

The Los Angeles Times reports that the EIA has revised downwards the amount of estimated possible oil extraction from 13.7 billion barrels to 600 million barrels. Oil taken from the Monterey Shale deposits was expected to boost the local economy by $24.6 billion each year and inject 2.8 million new jobs into the California market. 

The problem with the much-higher earlier estimate is mostly technological. It was based on findings by an independent firm hired by the government, Intek Inc., which assumed that the process for recovering gas from the Monterey deposits would be comparable to that used in other shale-rich regions. This, explains the Times, is not the case: 

The problem lies with the geology of the Monterey Shale, a 1,750-mile formation running down the center of California roughly from Sacramento to the Los Angeles basin and including some coastal regions. Unlike heavily fracked shale deposits in North Dakota and Texas, which are relatively even and layered like a cake, Monterey Shale has been folded and shattered by seismic activity, with the oil found at deeper strata.

The findings serve a major blow to U.S. energy policy, which considered the deposit a "black gold mine." But they shouldn't come as a surprise – the LA Times published an opinion piece back in December that pointed to earlier reports doubting the estimated output: 

A study by Canadian geoscientist J. David Hughes questioned assumptions made in the 2011 energy agency study and this year's USC report. The Hughes report, "Drilling California: A Reality Check on the Monterey Shale," analyzed current production data and concluded that the estimates were likely "overstated … wishful thinking" and that only a small percentage of the shale oil believed to be trapped in the formation will ever be produced.

The findings are a relief for some anti-fracking activists, who see this is an opportunity to get the government to back off plans to frack in the region. Clean Water Action California Director Miriam Gordon issued a statement in response to the news, saying: 

The downgrade of production ability of the Monterey Shale really negates the Governor's claim that we need to develop Monterey Shale resources to transition California away from foreign oil. Now it's even more imperative for the state to press pause on the fracking button and support a moraotrium as proposed by SB 1132 (Mitchell), especially since fracking causes huge methane releases and uses significant quantities of freshwater. 

Still, some are convinced that new technologies will be developed to access the elusive shale gas. Western States Petroleum Association spokesperson Tupper Hull told the Times that "We have a lot of confidence in the intelligence and skill of our engineers and geologists to find ways to adapt... as the technologies change, the production rates could also change dramatically."

This article is from the archive of our partner The Wire.