Eric Hovde says U.S. has “six times more” oil than Saudi Arabia

As Wisconsinites geared up to hit the highway for the Fourth of July, Republican U.S. Senate candidate Eric Hovde declared American energy independence as easy as 1, 2, 3.

Here’s the solution to high gas prices and overreliance on foreign oil, a
Hovde campaign news release said on July 2, 2012:

1.  "Immediately tap into America’s natural resources: More than 1.5 trillion barrels of oil (six times more than Saudi Arabia); 272 trillion cubic feet of natural gas; and more than half the world’s oil shale supply."

2. "End the moratorium on domestic drilling on public lands."

3. "Build the Keystone XL pipeline."

There has been much debate about drilling on public lands and the Keystone XL pipeline, which would move oil sands crude from Canada to Gulf of Mexico refineries. But there’s been little discussion of the claim that America has an untapped domestic oil source that tops oil-rich Saudi Arabia by a factor of six.

Is Hovde right?

Hovde’s campaign pointed us to the Republican website for the House Natural Resources Committee, chaired by U.S. Rep. Doc Hastings (R-Washington).

"According to the U.S. Geological Survey (USGS) the U.S. holds more than half of the world’s oil shale resources," the site says. "The most recent estimates (April, 2009) show the region may hold more than 1.5 trillion barrels of oil – six times Saudi Arabia’s proven resources, and enough to provide the United States with energy for the next 200 years."

Hovde, the committee website and the USGS are talking about the same thing -- the Green River Formation in Colorado, Utah and Wyoming. But each is using some critically different ways to describe it.

The Green River Formation is considered the world’s largest oil shale resource, but only sporadic attempts have been made to explore it -- typically when oil prices spike.

The reason: It’s not crude oil that lies beneath the surface, as in Saudi Arabia. It’s oil shale, a solid organic compound that can be converted to oil only when heated to great temperatures. The USGS made clear when it announced its findings in 2009.

Huge obstacles including costs, technology and environmental concerns have stood in the way.

Let’s start with the non-partisan source, the Geological Survey. Pressed by Congress during a gas-price spike several years ago, the survey analyzed the oil shale resource and determined the Colorado section of the formation by far the most promising.

They estimated that 1.525 trillion barrels of "in-place oil shale resources" lie in the Colorado section. That’s the number Hovde and the Republican website mention.

But each shortens that to "oil" -- and that’s a big difference.

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The Geological Survey describes oil shale as "pre oil" because it is not ready-made crude.

And the agency’s assessment made an important point: No economically viable extraction method is currently available in the United States, because the process is so technologically and environmentally challenging compared to conventional extraction of actual crude oil.

"Much of the resource in Colorado, where the richest deposits of high grade oil shale exist, are buried deep enough that mining is considered impractical or prohibitively difficult and expensive," said Justin Birdwell, a USGS research engineer studying the resource, in an interview. The focus, therefore has been on underground processing technologies, which are unproven.

Given this backdrop, the agency concluded in 2009 that it’s unknown how much of that 1.5 trillion barrels is recoverable. That’s still true today, although the agency is developing estimates. Recovery of oil is years or decades away, certainly not "immediate" as Hovde described it.

Additionally, when it comes to the Saudi Arabia comparison, Hovde runs into a major apples-to-oranges problem when he says the 1.5 trillion "barrels of oil" in the Green River Formation is "six times more" than in Saudi Arabia.

He is comparing Saudi Arabia’s 266 billion of "proved resources" with the 1.5 trillion in the Green River Formation -- but the latter number is only an estimate of the total "in-place" in the formation, without regard to the ability to get it out or get a viable price for it.

It’s a "major distinction," as a Congressional Research Service paper on US fossil fuel resources noted in 2010.

"Proved reserves are those amounts of oil, natural gas, or coal that have been discovered and defined, typically by drilling wells or other exploratory measures, and which can be economically recovered," the study said.

In terms of proved reserves, the US has 20.7 billion barrels -- 13 times less than Saudi Arabia, according to the latest data from the Energy Information Administration, a US government agency.

The Republican website Hovde cites was more precise and cautious than the candidate. It said the region "may hold" more than 1.5 trillion barrels, and explicitly compared that to the Saudi’s "proven" resources.

Hovde omitted the qualifiers.

In any case, according to two Congressional Research Service studies, oil shale "makes poor feedstock for making gasoline, so it might primarily be a source of other liquid middle distillate fuels such as jet fuel or diesel oil, fuels for which there is significant national demand."

Finally, Hovde’s claim reminded us of a February 2012 item by PolitiFact National that rated Mostly False a claim by Republican presidential candidate Newt Gingrich. He said that by one estimate the United States  may have "three times as much oil in the United States as there is in Saudi Arabia."

That item noted the same apples-to-oranges problem in the comparison.

Our rating

Hovde suggested that we immediately tap into America’s natural resources, which he said are "more than 1.5 trillion barrels of oil (six times more than Saudi Arabia)."

Hovde referred to a massive western United States formation of oil shale, and there’s a kernel of truth in that government officials estimate that 1.5 trillion barrels are contained there.

But Hovde omits a critical fact: He’s comparing that uncertain oil shale resource with Saudi oil reserves that have been discovered and defined and can be extracted economically. It’s unknown what the western formation will yield, and it certainly won’t come immediately.

We rate the claim Mostly False.