The Energy World is Flat: Opportunities from the End of Peak Oil

Chapter SixFlattener #3 – Horizontal Drilling and Fracking

First you have to learn the rules of the game. And then you have to play better than anyone else.

Albert Einstein

Never bet against an engineer

If you give enough time and money to an engineer, he will find a solution.

Technology in energy exploration and production has consistently pushed the boundaries of what we thought was possible, both in terms of volume and price. For example, what was once considered “science fiction”, such as extracting crude oil from depths of five thousand feet or more, or from shale formations, is today a reality.

There is a long history of “game changers”, all the way from offshore drilling, to deep-water, to ultra-deep-water, to “mining” Canadian oil sands, or more recently horizontal drilling and hydraulic fractioning, all of which have consistently pushed the boundaries of peak oil further and further into the future.

Yet, despite how impactful new technology has been in the past, it amazes me how we tend to disregard the potential and impact of future technologies. “Seeing is believing” or “a bird in hand is worth more than two in the bush” seem very entrenched in human nature.

And so, today, we remain very sceptical of our ability to develop “large known reserves” such as methane hydrates in Japan. Our perspective is probably not much different from what we thought about shale formations just 10 years ago or offshore ultra-deep 30 years ago. Well, just like in the past, the volumes ...