Inside EnergyContinued from page 47but he also ignores such relevanthistorical factors as the move ofmajor oil companies into the Mideastover the past 25 years.In short, statistics can be a dangerousweapon in the wrong hands.The Rand, OTA, and Menard Assessmentsall share a commonmethodological blunder that makesthem next to worthless as policyguides. Nehring, who wrote theRand report, also collaborated <strong>with</strong>the CIA economist Walt Macdonaldon the infamous 1977 CIA report,"The International Energy Situation:Outlook to 1985," which predictedpeaking world oil output bythe early 1980s followed by internationalcompetition over dwindlingresources.Macdonald admitted that in projectingfuture Soviet hydrocarbonreserves, for example, he merelymade a simple linear extrapolationof past data to predict that the SovietUnion would be forced to competefor Persian Gulf oil by the mid-1980s. When asked why he did nottake into account the nonlinear effectsof enhanced-recovery andother improved technologies, Macdonaldreplied, "Because this is theway I was told to do it."His method points up the flaw inall these reports. The science ofgeology should not be confused<strong>with</strong> statistical regression analysis,random-drilling models, and thelike, none of which takes into accountthe reasons why there hasbeen a relative stagnation of discoveriesof new giant fields.For example, using a statisticalanalysis of the number of giants andlarge (between 50 and 500 millionbarrels) U.S. fields, Nehring concludesthat "the amount of crudeoil discovered peaked in the decadefrom 1926-1935, coinciding <strong>with</strong>the peak in the number of giant oilfield discoveries."Yet, as we have seen, the 1922estimate of 9 billion barrels hasbeen "revised" to 50 billion barrelsactual and 150 billion barrels in undiscoveredreserves.World reserves have been similarlyunderestimated. Thirty yearsago, the estimated size for worldreserves more than doubled to 1.6trillion barrels when a Stanford professornamed Levorsen includedthe highly rich offshore basins inthe calculations for the first time.By the late 1960s, a consensus of 1.8to 2 trillion barrels was reached.Michel T. Halbouty, renownedpetroleum geologist and past chairmanof President Reagan's EnergyPolicy Task Force, agrees <strong>with</strong> JohnMoody's estimate that <strong>with</strong> 514 billionbarrels of oil equivalent (includingnatural gas) produced todate, there are 1.1 trillion barrels ofoil equivalent worldwide in reservesand a further undiscoveredpotential of 1.7 trillion barrels.Assessing the data of Nehring,Menard, and others, Halboutynotes that one reason for a globaldecline in the rate of new discoveriesfor the years 1965-1976 is simplythat exploratory drilling levelshave remained more or less constantoutside North America, andthat although there have been increasinglevels of exploration in theUnited States and Canada, much ofit has been in marginal fields <strong>with</strong>limited potential.Halbouty, a scientist rather thana pure statistician like the Rand analysts,concludes: "About as muchoil and slightly more gas remain tobe found as have been discoveredso far. . . . The undiscovered potentialthroughout the world is sizable."Recent decisions by the Reaganadministration, combined <strong>with</strong> record-breakinglevels of explorationin new areas of the Rocky MountainOverthrust Belt, the Williston Basin,the Tuscaloosa Trend, the BlackWarrior Basin, and the AppalachianOverthrust, show that <strong>with</strong> adequateincentives for new exploratoryactivity, reserve additions willbegin to appear—just as they didafter 1922.As Interior Secretary James Watt,Energy Secretary James Edwards,and geologists like Hedberg understand,we need exploration in themost promising new regions combined<strong>with</strong> deeper development ofexisting fields. Hedberg is convincedthat the principal site of developmentof new U.S. oil lies inthe largely unexplored offshoreareas. He notes that of the almost1,700,000 square miles of U.S. offshoreContinental Shelf area thathas great geological promise, wehave leased only a little more, than2 percent for exploratory drilling."The amount of producible petroleumin this U.S. offshore is anunknown," Hedberg says, emphasizingthat "almost all of it has sufficientprospects to be worthy ofdrilling exploration."Aggressive exploration <strong>with</strong> governmentencouragement, developmentof new technologies to enhanceretrieval, basic research inthe science of hydrocarbon geology,and research into how fossilreserves are formed in the firstplace will enable us to make scientificprojections about our hydrocarbonreserves for the future.Uwe ParpariA Mexican petrochemical complex: kept busy by Mexico's new oil finds.48 FUSION August 1981 Inside Energy
WashingtonLittle ProgressOn Fusion BudgetLittle progress was made in Congressduring April toward an agreementon the fiscal year 1982 budgetfor the magnetic fusion program. Althoughthe House authorizing committeehas marked up the budget,adding $14.7 million to the Departmentof Energy request of $460 million,the Senate has yet to take specificaction on the proposal.The budget required to carry outthe engineering phase of the MagneticFusion Energy Engineering Actof 1980 is $525 million.On April 29, Senator Pete Domenici(R-N.M.), chairman of the R&D subcommitteeof the Senate Committeeon Energy and Natural Resources,held hearings on the programs of theDOE Office of Energy Research,which includes the fusion program.The senator asked the DOE witness,Dr. Doug Pewitt, questions on manyother programs, but nothing aboutthe fusion budget. Pewitt, acting directorof the Office of Energy Research,in previous testimony hadcalled the 1980 fusion act "a permissivepiece of legislation."The committee staff has given nohint about Senator Domenici's thinkingon fusion, although he has beena supporter of fusion development inthe past.As of this writing, the worrisomeHouse Appropriations Committee hastaken no mark-up action on the fusionbudget, but staff members expectthe DOE bill to be considered beforethe summer. The Senate appropriationsprocess is considerably behindthat of the House and may not takeplace until September.MHD FacilityDedicatedU.S. Air ForceGeneral DynamicsJames A. Beggs (right) and Dr. Hans Mark, nominees for NASA administratorand deputy administrator.Reagan Nominates Strong Team to NASAPresident Reagan named James M.Beggs as NASA administrator and Dr.Hans Mark as deputy administrator inApril—a combination of an industryleader and a scientist that should considerablystrengthen NASA's visibilityon Capitol Hill.Beggs, a director of the GeneralDynamics Corporation, has been responsiblefor the Convair, Electronics,Fort Worth, and Pomona divisions ofthe company. The Convair Division isdeveloping superconducting magnetsfor the magnetic fusion program.NASA ExperienceBeggs also served in NASA's Officeof Advanced Research and Technologyin 1968-69 and as undersecretaryof transportation. Before joiningNASA, Beggs was <strong>with</strong> the WestinghouseCorporation.Mark was the secretary of the AirForce under President Carter and wasformerly head of NASA's Ames ResearchCenter. A physicist and nuclearengineer, Mark has worked <strong>with</strong> theacademic community and scientists inthe national laboratories.NASA supporters on Capitol Hill,who have tried to keep the spaceagency's funding at a level highenough to keep current projects onschedule as well as initiate new programs,are hopeful that this industrialscientificcombination will give themsome strong backup in the fightagainst the Office of Managementand Budget's budget cutting.A dedication ceremony in Butte,Mont, to mark the completion of theDepartment of Energy's magnetohydrodynamics(MHD) test facility tookplace April 24 in the middle of aWashington budget fight that mayend in the elimination of the MHDprogram.The new MHD Component Developmentand Integration Facility(CDIF) is a 50-megawatt thermal MHDgenerator built to do engineeringscaletesting of components for acoal-burning generator. MHD is aprocess to generate electricity directlyby passing high-temperature gasesfrom coal combustion through a magneticfield. The CDIF was designed tobe the first U.S. machine in which allMHD components are simultaneouslyfully operational.Although the dedication, whichmarks the readiness of the CDIF tobegin operation, is a milestone for theMHD program, it may be the lastone—unless the Reagan budget forMHD, now zero, is amended. CapitolHill sources indicate that Congresswill probably restore between $20 and$30 million to the program. The fundinglevel was more than $60 millionlast year.WashingtonAugust 1981 FUSION 49