Wednesday, 03 April 2013 14:32

The U.S. Is Swimming in Newfound Oil With CO2 Featured

bloomberg-newfound-oilPhoto credits: BloombergRoosevelt’s method, known as carbon dioxide-enhanced oil recovery, or CO2 EOR, may speed up America’s resurgence as a fossil-fuel superpower - and do so under a president elected as a green-energy championa. “Independence day is coming,” says Ed Morse, global head of commodities research at Citigroup Inc. in New York. 

The U.S. is swimming in newfound oil. Crude output surged 14.3 percent to an average of 6.47 million barrels a day in 2012 from a year earlier.

Elliott Roosevelt Jr., a grandson of U.S. President Franklin  Roosevelt, a Republican, says he disagrees with some friends in the party about climate change: He says it’s real. Yet he no longer subscribes to another hydrocarbon premise - peak oil, or the idea that global output is poised to permanently decline.

The remaining oil, however, won’t be cheap. “It’s not coming out of the ground at $20 a barrel,” he says. “All our models are run at $90.” West Texas Intermediate crude sold for $97.07 on April 1. Roosevelt uses a $90-a-barrel selling price for his financial calculations. When he reaches full production, he says, he can generate a 15 percent internal rate of return if crude sells for $50 a barrel -- greater if it sells for more.