The oil and gas industry is having a field day with the numbers they throw out about the potential oil and gas resources that could be extracted from the Greater Otero Mesa Area. Like all great fishing stories, this whopper is completely out of touch with reality. One recent story in the El Paso paper made the claim that there was enough natural gas under Otero Mesa to "supply 100 million homes for 100 years." In this case industry made the claim that over 19 trillion cubic feet of gas could be found in the Orogrande Basin. Part of which underlies the Greater Otero Mesa Area. Unfortunately for industry, the majority of the Orogrande field is under the White Sands Missile Range, an area used by the military for national defense that will never be opened for oil and gas development. Making the industry figures completely baseless. But even if we were to take industry at their figures, we discovered by using U.S. Department of Energy numbers from 1997, that there were 101.4 million households in the entire United States, of those 61.9 million used natural gas. In 1997, natural gas use by these households was 5.143 trillion cubic feet. Meaning that even if industry figures were correct the gas in Otero Mesa would only last 3.7 years, not 100. If we included commercial and industrial use, the supply would theoretically last 10 months.
However, industry likes to talk in large numbers to garner support and inflate the potential numbers of jobs and revenue to excite local communities and Representatives. In reality a more important figure is the economically recoverable amount of oil and gas an area offers. In this case how much gas can be extracted at the current price on the open market for oil and gas and a company make a profit? This will almost always dramatically drop the amount of oil and gas that can be recovered. For comparison, look at the industry forecast for Alaska's Arctic National Wildlife Refuge. In 2001, they claimed that 735,000 jobs and 9.2 billion barrels of oil could be recovered from the coastal plain. However, this was based on the unrealistic price of $43 per barrel. In 2001, oil prices varied from $22.11 to $14.19, thus the economically recoverable amount of oil in the refuge would be between none and roughly 3.2 billion barrels. This formula holds true for the Greater Otero Mesa Area. Currently the United States Geological Survey estimates that nationally 37 trillion cubic feet of gas is economically recoverable, but that is based on a price of $3.90 per thousand cubic feet. The current price of gas is fluctuating between $2.00 and $2.50.
For the Greater
Otero Mesa Area, the reality is that the amount of gas and oil that can be recovered
is much less than industry claims, if there really are any economically recoverable
amounts available. But they stand poised to build a pipeline from Texas and
carve roads across this great grassland in the hopes that great profit can be
realized. The real costs both socially and environmentally have yet to be calculated.