NCPA - National Center for Policy Analysis


August 22, 2007

Though rarely discussed, the United States has abundant reserves of coal, shale oil and conventional oil, says H. Sterling Burnett, senior fellow at the National Center for Policy Analysis.


  • The Energy Department has estimated that a process that turns coal to oil can compete if the price of conventional oil is above $30 per barrel.
  • The potential is substantial with U.S. production of oil from coal estimated to reach 1.7 million and 2.6 million barrels per day by 2030.
  • As a side benefit, the process of transforming coal to transportation fuel also produces natural gas that can be used for heating or electric power generation, and it removes more than 30 percent of the pollution released when coal is burned for electricity.

Another potentially huge supply of oil and natural gas is trapped in oil shale:

  • Rocks in Colorado, Utah and Wyoming alone contain 1,500 billion barrels of oil, and worldwide oil-shale could equal more than 500 years of oil.
  • Research at private companies has produced a technological revolution -- a process to heat the rocks in the ground, trap the oil and profitably extract it as long as the price of conventional oil is above $30 per barrel.

There are also vast untapped conventional oil reserves under the Outer Continental Shelf and the coastal plain of the Arctic National Wildlife Refuge (ANWR).  Each of these options, of course, has environmental benefits and drawbacks that should be analyzed and debated before ramping up production.  However, compared to the net amount of ethanol that can be produced, coal, shale or conventional oil from ANWR and the OCS hold greater promise of reducing America's dependence on foreign oil.

Source: H. Sterling Burnett, "Increasing America's Domestic Fuel Supply," KERA, August 22, 2007.

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