On Hole Cards, Or, "Drill, Baby, Drill"? Why? Is Canada Out Of Sand?

In America, today, there are three kinds of drivers: those who look at the other gas pumps down at the ol’ gas station and think: “Oh my God, I can’t believe how much that guy’s spending on gas”, those who look at their own pump down at the ol’ gas station and think: “Oh my God, I can’t believe how much I’m spending on gas” – and those who are doing both at the same time.

Naturally, this has brought the Sarah Palins of the world back out in public, and once again the mantra of “Drill, Baby, Drill” can be heard all the way from the Florida coast to the Arctic National Wildlife Refuge.

But what if those folks have it exactly backwards?

What if, in a world of depleting oil resources, the last thing you want to do is use yours up?

To put it another way: why isn’t all our oil part of the Strategic Petroleum Reserve?

Consider the inexorable logic of the Big Lie. If a man has a consuming love for cats and dedicates himself to the protection of cats, you have only to accuse him of killing and mistreating cats. Your lie will have the unmistakable ring of truth, whereas his outraged denials will reek of falsehood and evasion.

--From the book “Ghost of Chance”, by William S. Burroughs

So here’s the thing: we produce a surprising amount of our own oil right here in the USA (in fact, we’re the world’s third-largest oil producer), but we don’t produce enough to cover our current use, and that’s why we import about half of the roughly 19 million barrels of oil we use daily. The vast majority of that is used in vehicles or for heating; almost none is used to generate electricity.

Our largest suppliers of oil, despite what you might think, are not all from the Middle East: instead, it’s Canada, Saudi Arabia, Mexico, Nigeria, and Venezuela, in that order.

(Perhaps you’re thinking: “Canada? Oil?” Yes. Canada and Oil. They provide us with more than twice as much as Saudi Arabia from huge “oil sand” resources, primarily in Alberta; the exploitation of those resources has created a huge environmental controversy.)

Now if you ask me, an ideal situation would be one where we decided to get out of the business of using oil altogether – and to help make my point, we have some helpful numbers from a guy that you pay every day to figure this stuff out: Mark Doms; he’s the Chief Economist for the US Department of Commerce, and, to paraphrase Little Feat, he’s always handy with a chart.

According to Doms, 60% of our 2010 trade deficit (about $265 billion) represents the cost of imported petroleum products, and if things continue through December as they did the first three months of this year, in 2011 every American, man, woman, and child, will pay a “tax” of about $1000 to import all that petroleum.

Do you know what we, individually, spend on gas? In March of this year, the average household spent just over $300 on that month’s gasoline; 5 months ago that number was $56 lower. The way it works out, every time gas goes up 10¢ a gallon, it costs the average household another $7 a month.

And that’s not all: less than half of the total cost of imported oil is paid at the pump: about 44% of imported oil is used by businesses; another 15% is used by governments across the USA, and that means almost 60% of the cost of imported petroleum is “folded into” the price of everything else.

(A quick author’s note: you’ve seen the words “oil” and “petroleum” used liberally in this story; the exact literal reality is that in each instance we should really be referring to “petroleum products”, and that’s because we import and export not just crude oil, but a variety of other petroleum products. I get tired of using the phrase “petroleum products” over and over, and I’m probably using “oil” and “petroleum” more interchangeably than I should.)

So get this: if we were out of the importing oil business, we’d save about $300 billion a year – and as it turns out, over a 10-year period we could actually convert the entire US auto fleet to electric cars powered by windmills by providing $15,000 cash “buy-outs” for today’s 135,000,000 gasoline cars and building the wind generation and “smart grid” we’d need to support the effort…and doing all that would cost…wait for it…about $250 billion a year.

If I get the math right, 20 years after we first started building windmills and subsidizing cars, everything would be paid off; and every year after that the US economy would generate a $300 billion “profit” on our investment – unless the price of a barrel of oil goes up. If it does, the amount of money coming back to our wallets every single year from then on, obviously, also goes up.

And if we were out of the “using oil for driving” business, once everything was paid off we could put almost $4000 a year (in today’s dollars) right back in the pocketbooks of every family in this country – which, if you ask me, represents a pretty good “tax cut”.

Let’s also keep in mind that any new oil drilled on our public lands might not necessarily end up in the US; that’s because even if oil companies were 100% free to “Drill, Baby, Drill” in our waters to their hearts’ content…they’d also be perfectly free to sell as much of that same oil, anywhere in the world, to whatever entity might end up being the highest bidder – and today, our friends in places like India and China are desperate to be that high bidder.

Put all of this together, and you get back to the question I posed at the top of the story: why in the world would we be in a hurry to “Drill, Baby, Drill”, when we could, instead, put all our efforts into getting out of oil, which would save us so much money that the conversion pays for itself?

Then, when oil’s running $400 a barrel or so, let’s use our oil to pay China back the trillion dollars we owe ‘em…which, at current production rates, would only take about 400 days, assuming it were possible to divert all our production for that purpose.

To state it a bit more ironically, it may be that the smartest thing we can do right now is to conserve every possible drop of oil we have…until we don’t need it any more, and it becomes a sort of Strategic Cash Reserve that can help strengthen the dollar and reduce the national debt in the years to come, both at the same time.

Or to put it another way, the next time someone tells you they want to “Drill, Baby, Drill”...you can step right up, look them square in the eye, and ask: “Why do you hate America?”

And won’t that be fun?

On Improbable Realities, Part One, Or, “I Want A Jet Car With Frickin’ Lasers…”

When it comes to getting around, Americans love to consider the question of “what if…?”

As a result, our cars have evolved into “land yachts”, our trucks have become “monster trucks”, and the desire to drag our living spaces around with us has morphed into converted busses with rooms that pop out of the side, a Mini-Cooper hidden under the master bedroom floor, and self-tracking satellite dishes that fight for space on the roof with air conditioning equipment.

And for more than a few of us, “what if…?” has even extended to “what if my car…was a jet car?”

In today’s improbable reality I’m here to tell you that Chrysler engineers asked that exact same question, for roughly a quarter of a century, and as a result they actually designed and deployed seven generations of cars with jet engines—and they came darn close to putting the eighth-generation design on sale to the general public.

It’s a story of pocket protectors and slide rules and offices full of guys who look a bit like Drew Carey…but as we’ll see in Part Two, it may also be a story of technology that couldn’t be perfected “back then”, but could be reborn in our own times.

As so often happens, a bit of “setting up” is needed, and to get this story going we need to discuss exactly how jets—particularly gas turbines—work.

In the case of an automotive engine, the idea is that air is drawn into the engine, that air is compressed, fuel is added, and the air/fuel mixture is then set on fire with a spark plug. This rapidly heats the mixture, it expands, and the energy created by that expansion is used to turn a turbine (a variation on a fan) which is connected to the driveshaft that eventually turns the wheels.

Some aircraft and helicopter engines also use this design to turn propellers, but the majority of aircraft jet engines force the expanding air/fuel mixture out the back of the engine in the form of “thrust” that, to put it as simply as possible, “make airplane go fast”.

From an engineering point of view, there are a lot of advantages to a turbine engine.

In contrast to a design that requires pistons and valves and a crankshaft and a cooling system and a system for oil distribution, turbine engines have very few moving parts, are cheaper to manufacture, and require a relatively small amount of maintenance. They also have very long service lives compared to piston engines.

Beyond that, turbines start right up on very cold days. Because jets output lots of heat you never have to wait for the jet car’s heater to “warm up”, and they can burn virtually any combustible liquid or volatile gas as fuel.

Vibration is very low, and you get 100% of available torque at 0 rpm, which means you don’t have to “rev up” the engine to get the wheels to start turning (something that is also true of vehicles powered by electric motors).

“Eagles may soar, but weasels don't get sucked into jet engines”

--John Benfield

So that’s the why…now how about the “who did what when?”

1954, 1955, and 1956 saw Chrysler rolling out the first-generation CR-1 turbine engine. One vehicle was produced in each of those years; the ’55 version was designated the Plymouth Belvedere Sportone CR-1 Turbine Special. (The 1956 version of the same vehicle was rated at 100 horsepower and 13 MPG.)

By 1959 the CR-2 engine was in service, again only in “testbed” vehicles, and it had achieved ratings of 200 horsepower and, after a 1,200 mile demonstration run from Detroit to Princeton, New Jersey, a far more respectable 18 MPG.

Operating these vehicles had taught Chrysler a few things about the disadvantages of turbine designs:

--the gases that come out the back of the car are really, really hot (temperatures can climb above 1000 degrees F.).

--after you put your foot on the gas, there is an annoying delay before the turbines (and the wheels) start spinning faster.

--because you’re basically dumping fuel into the combustion chamber, fuel economy sucks.

--the CR-1 and CR-2 engines did not offer “engine braking”, which means there would be extra wear and tear on the brakes at the wheels, and, because the driver would be constantly “riding” the brakes, increased potential for a heat-related braking system failure.

An engine was coming along that would address these problems, and in 1961 it was dropped into the visually stunning TurboFlite, which looked like a cross between two famous automotive avians: an early 1960s T-Bird and a late 1960s Plymouth Superbird. This Chrysler-designed and Ghia-built car even featured a clear “bubble” canopy that lifted up to allow passengers to get in and out.

The CR-2A engine featured fancy new engineering that dramatically reduced the acceleration delay and provided engine braking, and in 1962 one of the two Dodge Darts that was fitted with this engine was taken on a 3,000 mile national tour (New York City to Los Angeles) to introduce the concept to the public. (Two other cars, both Plymouth Furies, were also fitted with turbine engines that year.)

At this point we need to talk about the most unusual characteristic of this type of car: its singularly unique sound.

If you can imagine the sound of a Learjet taxiing several hundred feet away you might have a pretty good idea of—well, actually, you don’t have to imagine it if you don’t want to. You can hear it for yourself by watching the film produced by Chrysler to document that 1962 cross-country trip.

By 1963, a fourth-generation engine had deployed new technology that recycled heat from the exhaust to “preheat” the intake air. This dramatically reduced the exhaust temperature while making it easier to set the intake air on fire, which significantly increased both fuel economy and horsepower.

Other improvements further reduced “acceleration lag” and provided better engine performance while idling.

There is just too much story for one day, so we will stop right here and pick up the rest next time. Before we finish, a quick recap of where we’ve been, and a preview of where we’re going:

Chrysler, among other manufacturers, was experimenting with using jet engines to turn turbines; the idea being to replace the piston engines used in virtually every car built from that day until this with something better.

Four generations of engine had already been produced, many of the problems that were associated with the original design had been either partially remediated or fully resolved, and a significant effort was underway to introduce the idea of “jet cars” to the motoring public.

In Part Two, Chrysler puts a turbine car in the hands of 200 lucky families, we continue a history that may not be over yet—and in a most unexpected development, we’ll discover the common heritage that links the 1956 Ford Thunderbird, the 1961 Lincoln Continental, the 1964 Chrysler Corporation Turbine Car, and the 2009 Dodge Challenger.

So how about that? A decade-long story of history, engineering geekery, and conceptualism…and all of it presented in the form of useful objets d’art.

And in Part Two: lots more to come.

What’s not to love?