Imported Crude Oil Alternatives 101

Crude oil is one of several inputs currently used by refineries to produce gasoline, here is a master list of alternatives to imported crude oil,. Crude oil includes lease condensates, and field production natural gas liquids. We produce 5.1 million barrels per day of crude oil.

Please add other to this list, and I’ll create a final wiki article sans my attempts at humor and opinion.

#1 - Conventional Liquids - These include natural gas plant liquids, refinery gains, and other oxygenates (I'll separate ethanol which is so common as an oxygenate in refinery use in the USA that it often imbedded in refinery input stats). These inputs are significant. They are used currently to supplement crude oil in producing the gasoline we consume. When you add in these substitute refinery inputs to our 5.1 million barrels per day of domestic crude oil, we produce 7.8 million barrels per day of inputs. The biggest of these crude substitutes are the petroleum liquids from natural gas that are collected after the natural gas leaves the wellhead (NGPL). Producing more natural gas produces significant quantities of liquids that are direct crude oil substitutes which are presently used as a refinery input to make gasoline. Also, significantly more petroleum products are consumed than crude oil produced globally. Why? because during refining, the volume of finished products is greater than then volume of inputted product due mostly to a drop in the specific gravity of the liquids from crude to gasoline and other finished products. This is why having refineries located domestically is so vital. Our refining tech is a significant national asset. And we benefit from these refinery gains which average about a 6% increase in what you put into the refinery.

#2 US Domestic Crude (Off Limits) - Producing oil in the USA under our laws is way better for the planet than in the rain forests of Nigeria. That includes ANWR! The Chinese are slant drilling in Cuban waters in the Florida Straights, the Russians have rigs all over Siberia in clone real estate to ANWR. So, we should buy Russian oil from Siberia instead of American oil from Alaska, produced under US law? This is public policy of appearance over public policy of substance.

#3 Non-Conventional Liquids (Conventional Ethanol) - The USA produces 600,000 barrels per day of Ethanol. Crude + Conventional Liquids + Ethanol brings the USA up to 8.4 million barrels per day of domestic input production. The notion that Ethanol consumes more energy than it produces is politicized junk science. Since all energy inputs other than the sun costs money, Ethanol would have to be subsidized to a level greater than the value of the energy it contains in order to just break even. If you price the BTUs in Ethanol and subtract the subsidy the net is still very positive. I'll label this as conventional ethanol and make a separate entry for second generation ethanol derived from any number of bio inputs other than corn kernels.

#4 BioDiesel (Conventional) - Mostly soy derived vegetable oils that can be used in place of or blended with petroleum diesels. We produce about 200,000 barrels a day of the stuff as an alt to imported crude oil. For some crazy reason I don't get, soy biodiesel is more politically correct than conventional corn ethanol. Maybe its Willy Nelson and all the Lefties that bought diesel Rabbits and committed themselves to the stuff politically, financially and psychologically. Biodiesel is like Tibet (anti commie, religious theocrats, good); ethanol is Pat Robertson (bad) or maybe people like the sound of 'biodiesel" more than that chemically sounding "ethanol".

#5 Concrete - What? Concrete is an asphalt substitute in roadway surfaces. Every mile paved with concrete is 3-4 miles of substituted asphalt (1 mile initially and 2 to 3 more in foregone overlays in future years). The media hasn't picked up on this yet but asphalt is being rationed in the USA. Significant quantities of refinery inputs are then diverted from asphalt production to other finished petroleum products. Asphalt and road oils are 3% of refinery output.

#6 BioPlastics - Non Petroleum corn and other bio sourced substitutes to petroleum plastics feedstocks. Petrochemical feedstocks are 2% of refinery output. Yes that's 2%, the media has America convinced it’s like 40%. But it’s still a source of legit alt gains.

#7 Natural Gas (Residential Heating) - Converting homes from Distillate Fuel Oils to Natural Gas releases crude for use as other finished products like gasoline and diesel. Building LNG terminals and pipelines in the Northeastern USA should be a national priority. Home heating must get off oil.

#8 - Alt Natural Gas (Land Fill Methane, Sewage to Gas etc..) Is already a part of the system and is being expanded all over the USA. Any alt natural gas that replaces crude oil for heating or electric power is an imported crude reducer.

#9 Coal/Hydro/Nuke Electricity (Residential Heating) - Homes in the Northeast USA currently using oil, that can't be reached with natural gas, can be hooked up to electric heating from any of these sources which reduces demand for crude oil.

#10 Passive/Active Solar (Residential Heating) - Ditto #6 anywhere a home uses a petroleum input (Heating Oil - NE USA) or electricity (generated from Fuel Oil, mostly Eastern USA) all reduce crude oil consumption.

#10b This is just a humorous one, since the impact is insignificant. But I love the irony in all the new well heads in western Colorado with their PV solar panels sitting on top. These power the meters and other well mechanics which used to be powered by a small APU that burned the hydrocarbon being extracted. Way more efficient and less risk to admin costly meter failure with PV solar.

#11 Coal / Natural Gas (Fuel Oil Electric Power Generation) - The #1 source of the significant reduction of US crude consumption following the 1979 oil shock wasn't car efficiency, it was converting fuel oil fired electric utilities to natural gas and coal. The easy conversions have happened, but at these prices another round needs to occur.

#12 Wind -> CNG (Gasoline Substitute) - This is Pickens. Natural Gas is used to generate electricity all over the USA. But a very high percentages of natural gas fired electric power overlays the high wind zones of the Great Plains. CNG is not as easy as burning E10 (a.k.a. oxygenated gasoline), but its about the same as burning E85 in terms of vehicle modifications. CNG/Hybrids would really be good as CNG can have power level issues.

#13 - Electric Power Storage / Transmission - There are two major inefficiencies with electric power - peak loading along with the lack of "storage" capacity and transmission line loss due to resistance. Plug-In electric vehicles, either assisted by a gasoline hybrid or a CNG hybrid, or 100% battery powered, can be a huge source of efficiency gains, by reducing petroleum generated electric power and freeing Natural Gas from peaking generation for CNG as a gasoline substitute. All these cars with electric storage capacity plugged into the grid at night become a massive collective battery to the electric system. This huge externality can be compensated for with peak load - off peak rate differentials and storage payment offsets to your electric bill.

#14 Canadian Tar Sands - The largest exporter of oil to the USA is Canada. The Canadians are producing something like 1.7 million barrels per day of tar sand oil which is NOT counted in most crude oil production statistics. It is a substitute alternative source of energy to crude oil. I think most Americans are fine with having petroleum imports come from Canada, whether that’s crude oil or alternative oils.

#15 Mexican Heavy/Ultra - Heavy and Ultra Heavy Oil is not conventional crude oil and is usually counted as 'non-conventional' in production stats. I'm not too worried if we replace imported crude oil from outside North America with Mexican Heavy. The other big source of heavy oil substitutes to crude is Venezuela, but they're commies. The US should have no interest in helping them turn their worthless Heavy and Ultra into something useful. I'm sure the Chinese will be in there working on cracking the stuff.

#16 Shale Oil - Shale Oil is heresy. It is a word that can't be spoken in the company of anyone on the Left. They go insane. The anti-shale crowd usually regurgitate arguments like "even at $140 per barrel oil, no shale is being produced, because it costs too much to produce and will never be economical." The reality is that shale oil was being commercial produced in Colorado after the 1979 oil shock. What killed it was the resulting 1986 oil glut that sent crude below $20 per barrel. Its oil price volatility that's shale's #1 problem. The current #2 problem with shale is that commercial production of shale oil is AGAINST THE LAW until the Department of the Interior gets around to completing their leasing regs in 2010! How much shale oil do we have? Lots ... like there is more shale oil in Colorado than proven reserves of crude oil on planet Earth. The Feds should expedite the regs and issue long-term contracts for shale oil for the US Strategic Reserve with a floor at say $100 per barrel. No doubt an Obama Department of the Interior will find reasons to extend the reg issuance period beyond 2016.

#17 Coal-to-Liquids - The South Africans after the 1987 anti-apartheid embargoes, picked up WW2 Nazi tech and built a second generation of these plants which converts coal into diesel. Sasol is selling the tech and building plants around the world. The coal rich, oil poor Chinese and Indians are all over this. The USA has lots of coal too. But like Shale, Coal-to-Oil is politically incorrect heresy.

#18 Gas-to-Liquids - You can also convert natural gas into finished liquids in processes beyond the capturing of the liquids that drop out of natural gas currently. It may be simpler to use CNG but this tech alternative is near viability. Like Shale and Coal-to-Liquid, Gas-to-Liquid is political heresy.

#16 Ethanol (Non-Conventional) - Ethanol from biomass, corn stalks, sawgrass is a trend reverser. Its just not quite here technically, yet. But when and if it happens all gasoline could go E10 without current fleet changes. That’s huge. Beyond E10 this cheap ethanol could take American gasoline to higher levels as the fleet would allow.

#17 BioFuels (Non-Conventional) Algae - This is an intriguing emerging tech that has lots of upside. We generate a lot of electric power in the deserts/semi-deserts of the Western USA from Coal and Natural Gas. The good news is this is also premier solar territory with energy levels above 600 kwh per square meter. What do you do with this? You capture all the carbon coming out of the electric plant's stacks and bubble it through clear plastic tubes filled with water populated by algae. Algae uses the sun's energy to convert the carbon from the coal burning with hydrogen from the water to make hydrocarbons. The little critters poop oxygen left over from the water. When you squash them you get two useful things oil and residual biomass. There are test facilities under way now getting results that point to commercial results of 1.3+ barrels per day per acre. Building these "farms" over an area of 40 x 40 miles total in SoCal, Arizona, Colorado, Nevada, Utah, New Mexico and West Texas would put 1,000,000 acres in production producing, in theory of 1.3 million barrels per day of biofuel. That's seriously worth thinking about.

#18 Hydrogen (Conventional) – Conventional hydrogen is the amount produced as a refining byproduct from normal crude oil hydrocarbons. If some people want to drive some Hondas around LA in proximity to the oil refineries (GASP) that are actually producing the hydrogen that’s cool.

#19 Hydrogen (Methane) – Since Hydrogen cracked from water IS NOT a source of energy, but merely at form of battery, you could also use the hydrogen in hydrocarbons, like methane which can be cracked in the car and fed to the fuel cell.

#20 Hydrogen (Water) – This is the final solution WHEN we get virtually unlimited electric power from nuclear fusion later in this century. Unless, someone comes along between now and then and builds a really efficient battery, then, we’ll just skip the whole hydrogen fuel cell thing and go plug-in electric from fusion. The automakers have a variety of different views and positions on this. GM is E85/Flex for heavies and plug-in electric for lights (2009/10 Chevy Volt), Toyota is hybrid, Honda’s playing with Hydrogen, The Euros have great diesels.