USGS report puts massive number on oil potential of West Texas shale formation

Economist Bernard Weinstein, associate director of SMU's Maguire Energy Institute, talks about the announcement of a massive oil potential announced in West Texas shale formation.

By Jill Cowan
Economy Reporter 

The statistics, released by the U.S. Geological Survey on Tuesday, were eye-popping: 20 billion barrels of oil, just sitting there, trapped in a layer cake of rock under a vast swath of West Texas.

That’s almost three times the amount of recoverable oil that the agency said there is in the Bakken-Three Forks formations, which have been the center of North Dakota’s recent energy boom. As of Wednesday, that amount of oil would’ve been worth roughly $900 billion.

The West Texas formation, known as the Wolfcamp shale, is also the biggest continuous oil accumulation ever assessed in the country, the USGS says.

But experts say the news is less a eureka moment than it is confirmation of what many have long guessed. ... 

 “We will never run out of oil,” said Bernard Weinstein, associate director of the Maguire Energy Institute at Southern Methodist University.

The Wolfcamp shale formation is in the Midland area of the Permian Basin, which is the most prolific oil and gas field in the continental U.S., Weinstein said. ...

Weinstein said that the USGS’ assessments in recent years have consistently turned up oil and natural gas estimates that are much higher than previously thought.

“Last time they revised offshore estimates it was like a 200 percent increase,” he said. “There are huge reserves in the Gulf of Mexico ... on federal lands -- there’s stuff everywhere.”

That means that, even if the oil stays far below ground, the U.S. is in a much different position when it comes to energy than it has been in past decades.

“Long term, it clearly enhances America’s energy security, knowing we have that much more we can tap,” Weinstein said. “It does give us a lot more leverage in the geopolitical arena, if we’re the No. 1 oil and gas producing country in the world.”

But that doesn’t necessarily mean we’re in for a return to an exclusively fossil fuel-powered nation. It just underscores the weight of policy decisions.

For instance, Weinstein said he didn’t expect federal subsidies for alternative energy sources to dry up, even under a Trump administration that has leaned into claims that human-caused climate change is a hoax.

Ending existing tax credit programs for wind or solar energy is “easy to say, but politically harder to do,” he said, because, “Where are the wind farms? Red states: Iowa, Kansas, Nebraska.”

Read the full story.