Speaking Of Alternative Oil Sources

Instapundit mentions that oil shale--a trillion barrel Plus source located in the United States--is looking quite promising with oil prices so high. (The Canadian oil sands, which I gather are a geologically similar format, are already being commercially exploited.) A couple of years back, I blogged about Changing World Technologies, a company that believed that it could turn sewage, garbage, turkey guts--in short, almost any organic material--into oil at the equivalent of $8 to $12 per barrel.

According to their web site, they are currently producing oil from turkey guts in Missouri--and the energy to run the plant is coming from the oil that they produce. Their description is a little weasel-worded, but makes it sound as though they get 100 BTUs of energy for every 15-20 BTUs consumed.

Now, a lot of magazines were hyping Changing World Technologies as the future two years ago, when oil was half the price it is now. I've asked a couple of times for an update--are they producing oil from turkey guts and sewage at a price that is competitive with current world oil prices? I've received no answer. If Changing World Technologies made enough sense for people like Warren Buffett to invest in it several years ago, when oil was cheap, I would think it would make even more sense today. So, what's the story?

UPDATE: I received a lot of feedback from readers. One pointed me to a story in Fortune that said that it is turning out to be a less of a bargain for energy production than first thought:

The key question is whether the end products are pure enough and cheap enough to compete with other biofuels and petroleum. Until recently it seemed that turkey fuel would score big on both counts. CWT saw opportunity in the mad cow scare of December 2003. Expecting U.S. authorities to ban the feeding of animal offal to livestock—a practice linked to mad cow disease—CWT and ConAgra formed a joint venture that built a $30 million plant in Carthage, Mo. The venture assumed that nearby turkey processors would provide lots of free turkey waste. Last year the Carthage plant began selling its output to a Midwestern manufacturer, which buys it for roughly $40 a barrel (25% less than conventional fuel) and uses it to run its plant. The Carthage factory now produces 400 barrels a day.

That's a drop in the ocean of U.S. oil consumption, currently running around 20 million barrels a day. But making more turkey fuel isn't as hard as nailing down its costs. It turns out that feeding animals to animals remains standard practice in the U.S., despite a modest tightening in the regulations last year. So instead of being free, turkey leftovers cost $30 to $40 a ton, a hefty expense considering that one ton of turkey yields just two barrels of oil.

And turkey fuel has so far been excluded from biofuel tax breaks. In October, Congress passed a bill that gave biodiesel, which is also derived from biological material, such as soybean oil and animal fat, but has a different chemical composition, a tax incentive that translates into a $1-a-gallon break on production costs. "The good news is that the government finally gave an incentive for producing fuel from waste," says CWT chairman and CEO Brian Appel. "The bad news is that it narrowly defined the kind of fuel receiving the incentive."

As a result of those two setbacks, CWT's production costs have doubled, to nearly $80 a barrel, a crippling blow given that conventional diesel sells for about $50 a barrel. CWT is staying afloat, thanks to a $10 million grant from the U.S. Department of Energy. But the company's next operation is likely to be in Europe, where food processors will pay to have CWT dispose of animal offal and where most governments offer tax incentives to biofuel producers. Appel is negotiating to license CWT's technology to Irish Food Processors, one of Europe's largest, which plans to build a biofuel facility by the end of 2006.

Still, this might make sense as an alternative to filling garbage dumps with waste, but we still aren't quite at the point where it is cost-effective for producing oil.

Another reader pointed me to this article from some sort of environmental organization--who you would expect to be quite supportive of a method of disposing of waste. The author purports to have a Ph.D. in Chemistry from Yale--but some of his statements make me wonder about his degree, because it betrays a real ignorance of chemistry:

Now along comes one more scheme for playing on the gullibility of a public that is so dumb it actually believes that a complex technological society, such as ours, can rip and strip the earth of all its resources, use them transiently, then somehow destroy them all, and still continue to leave a thriving planet for future generations. As though the earth is some kind of a magic lamp we can rub and the genie will continue to bestow upon us any gift we request. This concept is idiotic, and any company that seeks to effectuate the "getting rid of" part of this scheme is selling a bill of goods leading to planetary suicide. But this may not be sufficiently specific to your article to satisfy you.

I will back up to the beginning and pick apart the very heading of the article that began this all in Discover. It began with the heading "Anything into Oil" and proceeded in the article to flesh this out so: "The process is designed to handle almost any waste product imaginable, including turkey offal, tires, plastic bottles, harbor-dredged muck, old computers, municipal garbage, cornstalks, paper-pulp effluent, infectious medical waste, oil-refinery residues, even biological weapons such as anthrax spores. " Now in your article, you, or the claimants, hoping no doubt to have a prayer of passing the giggle test, have backed off a bit by only saying this much: "The company says its process works on tires, various hazardous wastes, and plastic as well as heavy metals. " Most emphatically none of this can pass the giggle test but let me ask you, do you understand what is being said here? You are saying that this company has a process which can turn steel into oil (just to select one of the more obvious idiocies). Do you know that steel is almost a pure element, namely iron, which no chemical process can convert to carbon? Are you familiar with the alchemist's search for transmutation in which they tried to turn base metals into gold? At least they didn't turn base metals into carbon and hydrogen, which is pretty much what oil is. This conversion just happens to contravene the laws of physics as presently understood. Is that a good enough indictment of the frauds being perpetrated by these PR mavens?

Except that Changing World Technologies has never claimed to convert steel into oil. They've made the claim that organic waste (turkey guts, sewage, wood, paper, plastic)--all of which are made of largely of carbon, hydrogen, oxygen, with a little bit of phosphorous, sulfur, and nitrogen--can be converted into oil (which is just about entirely carbon and hydrogen). CWT has always been clear that the various trace minerals that come out of garbage are essentially scrap, and play no part in the production of oil. It is possible--even likely--that the energy required to do this transformation from garbage to oil won't work. But there's no claim of transmutation in CWT's materials. Either "Dr." Palmer isn't reading carefully, or his rage that someone is trying to solve the garbage and oil problem is taking precedence over his education.

Now let's look a little further, to the subheading "Technological savvy could turn 600 million tons of turkey guts and other waste into 4 billion barrels of light Texas crude each year ". Apply a bit of that skepticism that journalism once relied on. How many pounds is 600 million tons. Multiply 600,000,000 by 2000 to get 1200 billion pounds. Now lets look at the oil. Depending on your definition of barrel, one of them weighs 300 to 400 pounds. So multiply 4 billion by 300 and you get 1200 billion pounds. What a strange coincidence! These phoneys say they can turn every pound of mixed water, dirt, rocks, paper, steel, acetone, tars, polyethylene, concrete (and oh, yes, turkey scraps too) into one pound of - are you ready for this - not just oil, not just a grease derivative, but light Texas crude. The loaves and fishes story has now been left in the dust. Jesus must be biting his nails with regret that he didn't think of this.

Uh, no. They have never claimed that they were goin to turn "dirt, rocks,... steel,... concrete" into oil. But paper (made largely of cellulose--carbon, hydrogen, and oxygen), acetone (again, carbon, hydrogen, and oxygen), tars (hydrocarbons), polyethylene (again, hydrocarbons), and turkey scraps (carbon, hydrogen, and oxygen, mostly): all of these things are convertible to oil. It might be too expensive to do so, but it isn't impossible. This Dr. Palmer is either a fanatic, or didn't learn enough chemistry to be expressing opinions as an expert.

Oh! I was wondering why this guy knows so little about a subject in which he supposedly has a Ph.D.:

As a member of the Sonoma County Local Waste Management Task Force and a former chairman of the Sonoma County Hazardous Materials Management Commission, he has been extensively involved in local garbage politics as well.

Sonoma County: where multimillionaires race Ferraris, when they aren't praising Noam Chomsky's critiques of the evils of capitalism.