A recent article in EU Business claims that Estonia has plans to further "diversify energy sources and boost electricity exports to other Baltic region EU states". It goes on to say that Estonia is the "world's leading oil shale producer". Is this possible for such a tiny country?
For those with little background like me in oil exploration and production, the following research reveals some surprising results:
According to a 2004/2005 published account of the US Geological survey, there are approximately 410 billion tons, or three trillion US barrels of known oil shale deposits stashed throughout the world. The US maintains 62% of these deposits, 70% of which are under federally managed land. Oil shale is not to be confused with "oil" or "tar sands", most of which is buried in Canada - approximately two trillion barrels worth.
Mining and refining oil sands becomes cost effective when world oil prices reach $30 / barrel, whereas refining oil shale is much more expensive and only becomes cost effective at $80 / barrel... like now.
In any case, while Estonia may only maintain 14 billion barrels of oil shale reserves, i.e., just 0.5% of the world's total, it is a leading producer at 14 million barrels annually (see figure 19 of the US Geological Survey). Given Estonia's tiny population and it's use of oil shale to generate electricity, the Baltic country could maintain energy independence from Russia and the EU - a huge relief given how the rest of the EU is dependent upon Russia for energy needs.
According to EU Business, "The recently modernized Soviet-built stations are the world's largest
oil shale-fired electrical power facilities. They play a crucial role
in Estonia's economy, making it one of the few EU states boasting
electricity self-sufficiency."
Indeed, Estonia plans on being a net exporter of electricity given it's relatively low usage and large production capacity.
Nevertheless, refining oil shale is a messy and destructive business and environmental groups are pressuring the Estonian government to stop oil shale production.
In the meantime, Jordan has tapped Estonia's production expertise. Should the US ever feel the need to refine oil shale, Uncle Sam may one day seek help from it's tiny Baltic ally.
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