Good afternoon ladies and gentlemen. As the title of my presentation suggests, I've been given a very large piece of ground to cover in this wrap-up session, In the course of my discussion, I will be touching on oil shale, coal gasification and liquefaction, tar sands and heavy oils, solar energy, geothermal energy, and enhanced recovery techniques. After one reflects a moment on these topics, I might well have said I was going to cover some "blue sky" in addition to a lot of ground. However, embodied in these topics are tremendous potential energy resources which deserve examination for possible contribution to our future energy supply. As a matter of fact, the potential of these resources is not really a question to most observers. People generally acknowledge that we have billions of tons of coal, mountains of oil shale, millions of acres of partially depleted oil and gas fields, an earth with a molten center, and a sun that never goes dark.

The question is -- when will the potential of these energy sources be tapped to an extent to significantly assist and augment our conventional energy supplies. Naturally, we have looked to our forecasters and soothsayers over the years to answer this question. When it comes time to do a post mortem on their predictions, we find a great commonality. The forecasts have rather consistently said that these resources will be developed more rapidly, and to a greater extent, than has actually been realized.

The newest crop of energy forecasters was recently assembled under the Federal Energy Administration. Their predictions have been summarized in a massive report entitled "Project Independence Report". Despite much analysis, these new forecasts of the potential of synthetics, under "business As Usual" and "Accelerated Development" scenarios, share the same over optimism of earlier, less sophisticated forecasts.

In our view the Report is consistently optimistic in projecting both the magnitude and the timing of supplemental energy resource development. Where capital figures are presented, they seem consistently understated. For example, in the case of shale oil, the Report estimate is at best 60% of our own recent estimate. These low capital projections, plus assumptions that existing tax laws will not be changed call into question one of the Report's major conclusions " that "the oil industry will be able to finance internally all of its investment requirements and still have additional funds to assist other energy projects outside the oil and gas industry".

Our pessimism has been fanned by the developments which occurred in the last half of 1974. The progress toward synthetic fuel commercialization unquestionably suffered a severe setback. Shell Explorer Limited, a wholly owned Shell subsidiary, announced it was discontinuing efforts to participate in the building and operation of a 100,000 BPCD oil sands plant in Alberta. Syncrude Canada Ltd. temporarily halted construction of its 125,000 BPCD oil sands plant when Atlantic Richfield Canada withdrew. The project is now going forward only because of the infusion of massive government funds.

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