Guest post by Alec Rawls
“President no longer worried about CO2!” That’s what the headlines should have read last week after Obama presented an elaborate argument that alternative energy is the only viable response to high energy prices without ever once mentioning CO2, global warming or climate change. Instead, he presented the need to lessen our reliance on oil purely as an economic imperative.
Back when he thought that global warming was a winning concern Obama used to acknowledge that his anti-CO2 policies were going to cause high energy prices (forcing them to “necessarily skyrocket“). Now he is trying to use the high energy prices that he intentionally caused as a reason to get away from fossil energy. But if we are no longer worried about climate, how about just undoing the anti-fossil-fuel policies that drove prices up in the first place?
Obama’s silence on climate is a testament to how thoroughly the alarmists have lost the climate debate in the eyes of the voting public. Obama can’t even mention climate change (never mind global warming), even in a speech about his own climate-driven policies.
To make his economic argument, Obama puts forward two glaring lies. Let’s take these whoppers one at a time.
The lie that we are already aggressively developing our fossil resources
From the President’s March 15th energy policy speech at Prince George’s Community College in Largo, Maryland:
Under my administration, America is producing more oil today than at any time in the last eight years. (Applause.) Any time. That’s a fact. That’s a fact. We’ve quadrupled the number of operating oil rigs to a record high. I want everybody to listen to that — we have more oil rigs operating now than ever. That’s a fact. We’ve approved dozens of new pipelines to move oil across the country. We announced our support for a new one in Oklahoma that will help get more oil down to refineries on the Gulf Coast.
Over the last three years, my administration has opened millions of acres of land in 23 different states for oil and gas exploration. (Applause.) Offshore, I’ve directed my administration to open up more than 75 percent of our potential oil resources. That includes an area in the Gulf of Mexico we opened up a few months ago that could produce more than 400 million barrels of oil.
So do not tell me that we’re not drilling. (Applause.) We’re drilling all over this country.
That’s chutzpah, bragging about opening up drilling in the Gulf after using the Deep Horizon spill as an excuse for wiping out the Gulf drilling industry with an illegal moratorium.
Everyone knows about the big anti-oil moves from Obama and the Democrats, like rejecting the Keystone pipeline and continuing to block drilling in ANWR, but if you want a picture of how systematic and extreme their anti-fossil-energy policies have been, take a look at the list compiled by House Natural Resources Committee Chairman Doc Hastings. As soon as they got in the Obamatons started revoking all the permits that were in the pipeline: for exploration, for mining, for drilling, for building power plants. Everything was shut down to almost nothing, and that is the way it has stayed.
Speaker John Bohner put a few of the highlights onto a timeline along with gas prices. Cause and effect:
What about that record amount of oil production? From Tina Korbe:
Energy experts say the president’s rhetoric isn’t exactly forthright. It’s unfair for the president to take credit for record high oil production. Not only does it take oil three to five years to come online, which means the previous administration was responsible for approving the exploration and drilling permits that led to increased production, but oil production on federal lands actually declined from 2010 to 2011. Oil production on private lands is responsible for the increase.
She quotes CNS for the specifics:
As CNSNews.com has reported, oil production on federal lands declined in fiscal year 2011 from fiscal year 2010 by 11 percent, and natural gas production on federal lands dropped by 6 percent during the same timeframe.
In contrast, oil production on private and state lands accounted for the entire increase, reported the IER, as production was up 14 percent from 2010 to 2011. Natural gas also was up 12 percent from 2010 to 2011.
The energy boom from advances in fracking technology are so massive that Obama has not been able to suppress them entirely, but he sure is trying, and we know why. Energy Secretary Stephen Chu was up-front about this as recently as two weeks ago when he testified before the House Appropriations committee:
“Is the overall goal to get our price [of gasoline] down,” Nunnelee began. “No,” interrupted Chu, “the overall goal is to decrease our dependency on oil, to build and strengthen our economy.”
Chu’s goal is less oil consumption, which of course requires higher prices, “to strengthen our economy.” (Note that Chu is a physicist, not an economist.) Chu has been saying for years that:
Somehow we have to figure out how to boost the price of gasoline to the levels in Europe.
That’s $7 to $9 per gallon. Under duress he recanted last week and said that he no longer wants higher prices, but that just stripped away his last remaining virtue, which was his honesty.
Lie number 2: that America is energy poor, so there is not much we can gain by drilling anyway
Someone who knows absolute nothing about anything might find this Obama riff compelling:
There’s a problem with a strategy that only relies on drilling and that is, America uses more than 20 percent of the world’s oil. If we drilled every square inch of this country — so we went to your house and we went to the National Mall and we put up those rigs everywhere — we’d still have only 2 percent of the world’s known oil reserves. Let’s say we miss something — maybe it’s 3 percent instead of 2. We’re using 20; we have 2.
Now, you don’t need to be getting an excellent education at Prince George’s Community College to know that we’ve got a math problem here. (Laughter and applause.) I help out Sasha occasionally with her math homework and I know that if you’ve got 2 and you’ve got 20, there’s a gap. (Laughter.) There’s a gap, right? …
We will not fully be in control of our energy future if our strategy is only to drill for the 2 percent but we still have to buy the 20 percent.
Obama’s 2% figure refers to “proven reserves,” and the smallness of this particular number is actually a measure, not of our resources, but of how little they have been developed. Investors Business Daily explains:
The U.S. has 22.3 billion barrels of proved reserves, a little less than 2% of the entire world’s proved reserves, according to the Energy Information Administration. But as the EIA explains, proved reserves “are a small subset of recoverable resources,” because they only count oil that companies are currently drilling for in existing fields.
We have very little “proved reserves” because we have developed only a small fraction of our resources into active fields. The relevant number to look at is the amount of oil we could produce if it were allowed, and here we are proverbial thousand pound gorilla. Again, from IDB:
We actually have the world’s largest fossil energy resources, and the “recoverable” part is rapidly expanding as the technology for extracting it advances. Estimates for technically recoverable shale gas reserves increased 134% in 2010, and we’ve hardly begun on shale oil. Then there are methane hydrates, which according to the Department of Energy contain “more energy potential … than all other fossil energy resources combined.”
In short, the United States, and the entire world, have only been tapping the planet’s most easily accessible fossil energy supplies, and even those are far from running out, while vastly larger resources wait in store. Obama’s claims about the impossibility of relying on fossil energy are a fairy tale for childish green adults who want to see themselves as saving the planet. They dream of going “forward” to windmills and absorbing solar radiation like a snake on a rock, yet none of them have enough confidence in the saving-the-planet part to even mention it anymore.
The war on CO2 is over! Tell the EPA!
Obama’s lies about fossil resources are just supporting lies. His big lie is his pretense that his anti-CO2 policies are not about CO2. So take him at face value. He has apparently surrendered his claim that CO2 is dangerous. From his energy-policy speech, it seems that global warming is no longer a motivating concern.
THAT is a big story. Quick, tell the EPA. With this change in the administration’s position there should be no more regulation of CO2 and Obama should rescind his promise to bankrupt the coal industry:
So if somebody wants to build a coal-powered plant, they can. It’s just that it will bankrupt them because they’re going to be charged a huge sum for all that greenhouse gas that’s being emitted.
That war against coal is proceeding apace, every bit as much as Obama’s drive for higher gas prices. And all for nothing, since even Obama is no longer worried about CO2.
At some point—long before we run out of fossil energy—a cheaper source of energy will be developed and fossil fuels will go by the wayside. The only reason to interdict that natural progression and try to go backwards to wind and solar is a belief that fossil fuels imperil the planet. For that to be true, human effects on climate would have to dominate natural effects, a hypothesis that has already been falsified by 15 years of no warming. The only people who believe it at this point are the paid shills of our lavishly funded climate-alarm industry and their anti-capitalist allies. It has actually become unmentionable, which really does warrant some mention.
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I think Torgeir Hansson is a Troll…….
http://community-sitcom.wikia.com/wiki/Norwegian_troll_doll
We humans have been extracting gold and silver from the bowels of th earth for tens of thousands on years. Then we went for copper, tin, zinc and lead. Each discovery gave us a technological leap forward. Later on we discovered iron, which gave us a quantum leap. We continued discovering ores and transforming them into technological material for the advancemnt of humanity. Aluminum was the latest addition to the metallurgical field. meanwhile we had been extracting diamonds and other precious stones for our kings and queens, our temples and churches, hollywwod stars and billioners..
Some 150 years ago we started extracting oil, making our civilisation what it is today. Just 150 years of extracting black gold and we are hearing and reading of ‘peak oil’.
During these thousands of years of extracting gold and silver, copper and tin, lead and steel, diamonds and rubies, we never heard or read someone shouting peak gold, or peak iron or peak diamonds. But after 150 years of extracting oil we hear of peak oil. This is just rubbish. Have a look at a world map and mark the points from where we have extracted oil up to this day and one will realise that we have just scratched the surface. This is all a scam for robbing us of our hard-earned wages for others to get richer and richer and richer while the western countries are floundering in the financial mire. The latest scam is EU issuing 100 year bonds, meaning that the banks are getting loans from our great great great grand children…………..
All it takes to remedy the situation is to have a US president that is honest about this and acts honestly. That’s all the world needs; an honest US president.
I just wish I can fake US citizenship and come and vote come November.
Moderator’s wrote: “This comment is acceptable. Please remember, however, that we are talking about the President of the United States and there are some lines that will not be crossed. Please exercise… shall we say, discretion? in comments. Thank you for your cooperation.”
I agree Moderator that a civil discourse is the best way to win an argument and that “there are some lines that” should “not be crossed”. But I think those lines should apply equally to everybody, with no special treatment for a president.
Sometimes you learn more about your own society by studying others. I’m British and a life-long republican i.e. against the institution of constitutional monarchy, which I think is an anachronism. But after observing the American political process my views have started to change.
During the Iraq war many American ‘progressives’ were appalled at, what they perceived to be, a reluctance by the press corps to ask President Bush tough questions. John Stewart, of The Daily Show, made a trans-Atlantic comparison: “the British Prime Minister has to stand in Parliament, every week, and respond to the questions of his most vociferous critic” (paraphrased from memory).
I think the reason the British press give their Prime Minister a much tougher time than their American counterparts do their President is because of the differences in the political systems.
The British Prime Minister is not the Head of State. He lives in a house known by its street number, not a royal palace. Nobody sings Hail to The Chief, in his honour. He has to symbolically bow to someone else who represents the state -the British monarch (not the Saudi one).
British royalty’s role is purely symbolic, with no significant political power. Parliament has the power to abolish it at a stroke. Despite their symbolic position, if any member of the royal family says or does anything stupid, they will be ridiculed as freely as anyone else, in fact more so. I’m not going to be thrown into the Tower of London for calling Prince Charles an idiot. He is, and I think most of my countrymen agree.
The system works well and I think that is the reason so many Commonwealth countries still have the British monarch as their head of state, despite a lot of post-colonial bitterness. I think it is also one of the reasons former British colonies tend to be more stable democracies than many other young nations.
I’m still an anti-royalist but not as much as I was.
Sorry, this is turning into an essay and is possibly off-topic. So, I’ll cut it short.
I was glad to see the rise of Obama, then concerned to learn about his background, which the the U.S. media did not adequately explore. [Yes I read all about birth-certificates etc. and I’m not talking about those]. I don’t worry about him so much now. He has disappointed many of his supporters. I think the thing Obama believes in the most is himself. He is a Zelig, capable of doing and saying anything, to curry favour with whichever group he happens to be with. And he is a narcissistic, capable of doing and saying anything, to promote himself.
P.S. If you ex-colonials want to rejoin the Commonwealth, I’m sure something could be arranged. 🙂
The point of the post: Obama can’t even mention climate change or AGW in an energy speech. Convincing evidence that Al Gore is right – “the debate is over”
Just a piece of political antipropaganda this piece. In my view WUWT should stay to be about climate as much as possible and stay away from politics. Being a climate sceptic is about looking at te facts, being a politician is about using some facts for your goal. This piece is clearly the latter.
“If we drilled every square inch of this country — so we went to your house and we went to the National Mall and we put up those rigs everywhere — we’d still have only 2 percent of the world’s known oil reserves.”
I wish the alarmists would apply similar logic to their beloved windmills.
Paraphrased:
If we placed wind-turbines on every square inch of this country — so we went to your house and we went to the National Mall and we put up those turbines everywhere — we’d still generate a fraction of the energy that we need.”
Since this is political, the battle is not with facts, figures, logic, analysis, etc., but one of sound bite “slogan’. Sound bites coupled with the 30 second ad. The result of this will be all so predictable, like watching A Wonderful Life. The topic is drawn along a narrative boundary with some sliver of fact (recall the meaning of “is”). It’s repeated by the policital machines and then amplified by the MSM. It’s extremely conforting to read articles like this since it provides knowledge comfort. If you turn your analysis to how the Left/Greens work, they spend perhaps 10% of their articles simply referring to someone else’s conclusions then proceed to examine how best to market their concept. Reasoned folks tend to simply stop at “Aha! I know the truth” and make a leap of faith that voters will do the same when they go through the facts. Just ain’t every gonna happen. We’ve decades of proof.
What to do? Use this article as the “reference back” and then spend your efforts in beating their narrative on their field of play – meaning ad war. And it has to be effective, simple, etc. The gist would be an ad that states “Obama says we’re developing our energy resources as fast as we can but doesn’t tell you he’s tied both arms and legs behind our back”. Let them bore folks to tears with their “figures”. Respond with very short bits such as “Why not Anwar?”, “Why not oil shale”, “why no pipelines”, “why is China drilling off our coast but we’re not?” – things like that.
Remember, in this game, a draw is a loss.
Vangel Vesovski.
You are far behind the times in terms of the on-going shift in world energy production. We are seeing a paradigm shift. There is a huge amount of energy production about to break out from politically stable portions of the world, not just the USA.
Consider the geo-political implications if Israel becomes a Saudi class Oil exporter of light sweet crude at $35-$45 a barrel, and a major Natural Gas exporter, in about 7-years.
Once Israel breaks the risk premium (capital risk of the technology and the political risk premium from Arab oil retaliation and Green Regulatory NIMBY-ism) of the deep oil shale extraction and waterless deep gas fracking. (See article below) We will see a huge amount of energy sources emerging in politically stable areas of the world at $35-$45 a barrel.
Israel is providing an example of how oil consuming nations can become oil producing ones.
Forget Europe and America for a moment. Think China.
And once Israel goes there for oil shale, the barriers to coal gasification and natural gas to liquid hydrocarbon will also fall (Just google “Shell GTL” or “Pearl GTL” for the basics.), following deep oil shale extraction into the stable world energy mix.
$4 a gallon is the upper market limit on refined fuels, absent government interference via taxes, environmental regulations, moratoriums on energy development, and political instability risk premiums.
Liquifaction of coal to synthetic POL is now feasible at $4 a gallon pump price, and Shell’s natural gas liquifaction plant in Malaya has been converting natural gas to diesel for years. Shell’s new CFL plant in Louisiana is producing synthetic diesel from natural gas because diesel’s pump price is over $4 a gallon.
This is a set of technologies that will power the world economy for the next 50 years…without the Arab oil ticks.
http://oilprice.com/Energy/Crude-Oil/Israel-May-Hold-the-Worlds-Third-Largest-Reserve-of-Shale-Oil.html
Israel May Hold the World’s Third Largest Reserve of Shale Oil
Last summer huge deposits of natural gas were found along Israel’s northern coastline.
As with almost everything having to do with that controversial country, both Israelis and others found this “revelation” a mixed blessing, to say the least. On the one hand, it certainly eases concerns about Israel’s energy viability, with enough not just for its own needs, but sufficient quantities to become a major exporter as well.
At the same time, many Israelis feared the effect such “easy money” would have on the country’s already significant elite corruption problem, and its proximity to Lebanese territorial waters raised once again the question of the wisdom of Israel’s 2006 invasion, which alienated many previously pro-Israeli elements in Lebanon, and seemed sure to fuel a national consensus to contest any easy access for which Israelis might be hoping.
Hmmmm … sounds a bit like BP and their Arctic drilling problems in Russia … 😉 …
Now, it turns out, even more fuel is being added to Israel’s energy fire — so to speak — with the equally stunning news that the country may hold the world’s third largest quantities of shale oil – behind the US and China, both of whom would consume almost all of their own production – meaning Israel could indeed become the world’s largest exporter of shale oil — hence the comparison to Saudi Arabia.
Israel a global super power in energy ??? The mind boggles.
But the same sort of technological revolution that has made previously inaccessible on-shore natural gas suddenly available – via a process of hydraulic fracturing, or fracking, an environmentally destructive process whose impact on the global natural gas scene we discussed last week – is now apparently transforming the extraction of shale oil as well – and in so doing, shaking up the energy dynamics of the entire world, including Israel.
How did all this come to be ???
The most recent developments in this story start with Dr Harold Vinegar, the former chief scientist of Royal Dutch Shell, who is at the center of an ambitious project to turn Israel into one of the world’s leading oil producers. Israel Energy Initiatives, or IEI, where Vinegar is chief scientist, is working on projects to extract oil and natural gas from oil shale from a 238sq km area of the Shfela Basin, to the south and west of Jerusalem.
Oil shale mining is often frowned upon by environmentalists for many of the same reasons as fracking: it’s a dirty process that is both energy and water-intensive.
IEI, which is owned by the American telecom group IDT Corp, believes its technique will be cleaner than that of other operators because the oil will be separated from the shale rock up to 300m beneath the ground.
Water will be a by-product of the process, rather than being consumed by it in large volumes. Vinegar says Israel has the third-biggest oil shale deposits in the world, outside the US and China:
“We estimate there is the equivalent of 250 billion barrels of oil here. To put that in context, there are proven reserves of 260 billion barrels of oil in Saudi Arabia.”
And not to upset too many people, but we also ran an item earlier this year about Arab scientists working for ARAMCO who argue that the Saudis have, in fact, systematically OVER-estimated their proven reserves.
IEI estimates the marginal cost of production will be between $US35 – 40 per barrel.
This, Vinegar points out, is cheaper than the $US60 or so per barrel that it costs to extract crude from inhospitable locations such as the Arctic – wow, if BP CEO Dudley isn’t gnashing his teeth when he reads this 😉 – and compares with $US30 – 40 per barrel in some of the deepwater oilfields off the coast of Brazil.
“These Israeli deposits have been known about, but have never been listed before. It was previously assumed there was not the technology to deal with it.”
IEI hopes to begin production on a commercial basis by the end of the decade, with a view to producing 50,000 barrels per day at the outset. This would be a fraction of the 270,000bpd consumed daily by Israel, but would be a significant step towards making the country energy-independent. With one barrel of oil comprising 42 gallons, Vinegar estimates each ton of oil shale contains approximately 25 gallons.
The extraction process involves heating the rock underground, using electric heaters, to approximately 325C, the level at which the carbon-carbon bonds in the rock start to “crack”.
Wow, this really DOES sound like the shale oil equivalent of “fracking”. The oil produced by the process is light and easily refined to a range of products, including naphtha, jet fuel and diesel.
This is significant, since light oil — like that produced in Libya — is considered “sweet” and much less costly to refine than the heavier crude found in Saudi Arabia.
Given the importance of political receptivity to outside investors in the energy business, it’s not surprising the project is attracting serious interest from outside investors. In November, 2010, an 11% stake in Genie Oil & Gas, the division of IDC that is the parent company of IEI, was acquired for $US11m by Jacob Rothschild, the banker, and Rupert Murdoch, chairman of News Corporation and promoter of right-wing lunacy throughout the English-speaking world.
Genie’s advisory board includes impressive figures such as Michael Steinhardt, the hedge fund investor, and more frightening ones, like Dick Cheney, former US vice-president, and co-founder of the Shiite Islamic Republic of Iraq, along with his running buddy George W Bush.
An appraisal is now under way that would be followed by an 18-month pilot stage, according to Vinegar. Among the issues this will address will be concerns raised by environmental groups, including an examination of IEI’s claims that the process does not require excessive use of water or energy.
Reassurance will also be sought that a local aquifer, which is several hundred metres below the shale deposits, will not be contaminated by the work. This is key, because, while the Middle East may have an abundance of fossil-fuel energy, it has a decided shortage of water, so any process that is a major net consumer of water may not be cost-effective from an overall point of view.
Assuming these early stages are completed successfully, a demonstration phase would then take place over three to four years, during which the work completed in the pilot phase would be continued on a larger scale. Only then would the commercial operations begin.
By that time, up to 1000 people would be employed on the project, many of them specialist engineers from outside Israel, says Vinegar, who adds:
“Funding is not needed for the pilot and demonstration, although once we get to 50,000 barrels per day, we would want to have a partner. We have been approached by all the majors.”
Not surprisingly, the project still faced a number of significant issues, as Vinegar points out:
“There is a geological risk:
– Is the resource there?
– What is the risk to the aquifer?
– We have no doubts here, in particular that the resource is there and is of good quality,
– but the pilot can prove these things.
“Then there is the technological risk:
– Can we drill long horizontal wells?
– Can the heaters be placed in them?
– And can they last?
“And finally there is the economic risk, what the price of oil does. But I think the price is going to continue rising, to the extent that, by 2030, we will be at around $US200 per barrel.”
And while this seems to have escaped Vinegar’s attention, which is not a great sign, there is a fourth potential risk for the project: whether it is capable of sufficiently overcoming substantive objections from environmentalists to win popular support – perhaps the most important challenge facing him and his colleagues.
If they are successful, though, it will probably mean an end to one of the most humorous stories in Jewish culture about fossil-fuel energy: During a crowded Passover service, a rabbi telling the story of the Exodus from Egypt was interrupted by an old man, who kept shouting, “Moses was a schmuck, Moses was a schmuck.”
Of course, the congregation was shocked, and the stunned rabbi finally asked the old man why he was criticizing the great hero of Judaism / Christianity / Islam. The old man replied without hesitation: “He said when they come out of Sinai, turn left. If he had any brains, he should have told them, “Turn right.'”
David Caploe PhD
Chief Political Economist
EconomyWatch.com
“Gerard says:
March 20, 2012 at 3:47 am
Just a piece of political antipropaganda this piece. In my view WUWT should stay to be about climate as much as possible and stay away from politics.”
I could not agree more. This piece is WAY wrong on Canadas data, so why would anyone take this piece seriously? Canada probably has 2000 billion bbls equiv, ie, 10X as much as is shown.(oil sands, coal, NG, arctic, shale)
WUWT will decend into nothingness as left/right warfare will break out. This piece is just trash talk, not worthy of WUWT!
Obama will pretend to be whatever he thinks he needs to in order to win reelection. Let’s not be stupid and believe the pretense. If he wins, we’ll have 4 more years of an EPA which thinks CO2 is a pollutant that only the government is wise enough to control, no Gulf of Mexico oil drilling, no Keystone pipeline, incomprehensible commitments to heavily subsidized, inefficient wind turbines, and the like. Not to mention 4 more years during which eco-liberals masquerading as climate scientists will continue to get Federal money to promote and brainwash the population with “research” into their pre-determined conclusions. And I won’t even start on Federalism, health care or entitlements.
Gerard says:
March 20, 2012 at 3:47 am
Just a piece of political antipropaganda this piece. In my view WUWT should stay to be about climate as much as possible and stay away from politics.
WUWT “deals with puzzling things in life, nature, science, weather, climate change, technology, and recent news” — the speech was puzzling enough, and it was certainly in the news…
@Stephen Fisher Richards says:
It seemed clear some time ago that Obama had stopped believing in the AGW myth. He has the intelligence and open enough mind to step away from something when the evidence shows it is make-believe. Politically he can’t yet say this, of course.
Harpo
He is a politician. Itelligence does not come into this equation. Cunning, deceit, lieing yes and very good at he is, at least the straight face bit.
If you were a politician, and you needed votes from an uneducated population, what would you do? What could you do? If you try to tell them the truth (on any subject) they will reject it and vote you out.
Politics nowadays is the art of saying things which get more far-right libertarians AND far-left socialists AND everybody in between to vote for you than your opponents. There used to be a time when politicians stood up and said (for example):
‘I am a medium-left socialist – this is why – vote for me if you think the same way I do’.
Those were the days when democracy worked because principles were involved. Nowadays focus groups try to construct a set of beliefs which will can be accepted by 34.8% of the Hispanic population and 22% of the Irish…
Unfortunately, nobody is interested in a set of beliefs which can be accepted by 80% or more of educated people. There are too few educated people to matter.
David Caploe wrote:
“He [Moses] said when they come out of Sinai, turn left. If he had any brains, he should have told them, “Turn right.’”
I think you missed the usual punchline to that joke, which is:
“We would have got all the oil and the Arabs would have got all the oranges”
I haven’t read anything else indicating such large reserves in Israel. There is definately gas offshore. Hopefully, the field extends into Lebanese territorial waters. Oil rigs create wealth but are vulnerable. Perhaps the Lebanese will see that blowing up bits of their neighbour is not in their best interest.
Anthony — this piece is way way too ‘two-party politics’ for my tastes and is far from the usual for WUWT where policy can be argued but party-based political screeds have not normally been posted. It reads like the ranting of some right-wing TV pundit–inappropriate here, I think.
ouis says:
March 19, 2012 at 7:31 pm
I don’t understand why we can’t do both. Why can’t we continue to drill for oil while alternative energy sources are being developed.
_________________________________
No one is against developing alternate energy sources. I would love to see mini thorium nuclear reactors become available. http://nextbigfuture.com/2010/10/partnerships-toward-minifuji-thorium.html
What we are screaming about is wasting tax payer money on alternate energy sources that just do not work and can not because of the physics or mechanics involved and further more have a rotten Return on Investment for the tax payer. For example windmills are great for moving water but worse than useless for producing electricity because they unbalance the grid. Solar panels are great for remote use where it is a pain in the rump to run electric wires. see: http://www.pcsn.ca/solar-energy-technology-2/
The really useful alternate energy source is nuclear but the eco-nuts will do anything to kill it including LIE: http://atomicinsights.com/2012/03/conversation-with-an-anti-society-antinuclear-activist.html
Discussion on Thorium: http://www.physicsforums.com/showthread.php?t=358038
I get a little weary of the Oil is fungible/internationally traded argument. Yes, it is NOW. But it doesn’t have to remain that way. Other commodities – from diamonds to timber are also traded internationally but treated as standard trade goods. We could easily trade excess US oil on our terms rather than being driven by OPEC or Brent. Granted there is no US crude excess at the moment, but it wouldn’t take long to change that. We used to supply the world with oil – remember?
Granted there is no US crude excess at the moment, but it wouldn’t take long to change that. We used to supply the world with oil – remember?
That was a long time ago and will never come back. We have to be realistic about what we see, not depend on models and pronouncements not supported by actual data. By now you should realise that the shale gas story was little more than hype. Producers needed $7-$9 per Mcf gas but were stuck drilling even when prices fell to less than $4 per Mcf. While that was great for consumers of gas it destroyed capital and blew up the balance sheets. We are now expected to forget the shale gas fiasco and believe that shale liquids will somehow be very different. But the truth is found in the 10-K cash flow statements and footnotes, not in narratives from people who missed the shale gas story because they didn’t understand what was going on.
I don’t know what Obama really believes, at least when it comes to energy. He appears to say whatever it takes to get elected — just look at his laughable claims of supporting an “all-of-the-above” energy policy all along.*
However, nobody can point to an example where alternate energy really works. It requires tax-payer subsidies wherever it’s installed. It costs much more than conventional energy sources. It’s less reliable than conventional energy sources.
There is no economic miracle associated with alternate energy. Nowhere does the industry stand on it’s own, not even in China. For now, and the next few years, alternate energy is just another progressive, Utopian pipe-dream.
* Technically, “all of the above” is correct because in Obama-world, the only choices are:
A) Solar energy companies back by Obama bundlers.
B) Wind-power companies backed by family members of prominent Democrat politicians.
C) Ethanol backed by the farm lobby and ADM
D) Biofuels companies backed by Democrat fund-raisers
E) All of the above
John R. (Rich) Van Slooten says:
March 19, 2012 at 8:21 pm
Having a 40 yr. background in the petro-chem & oil/gas industry, MS Che, senior process consultant, working in the syn-fuels industry…
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From another chemist (retired) who worked in plastics and pharmaceuticals THANK YOU!
I shut up one eco-nut who was bashing plastics by telling her that if she hated plastics so much she should hand me her house keys, car keys and her clothes or else she was a G… D… hypocrite! She turned beet red and stomped off while her audience laughed. (The plastics plant I worked at had just been closed two days before, thanks to the MSM lambasting of plastics)
“Vangel, your assertions are dated and untenable.”
But that is not true. After years of hyping shale gas we have yet to see the shale gas producers generate positive cash flows or to see the sector make a profit once all of the costs were accurately accounted for. It is easy to show a profit if your EURs are twice what the production data is suggesting but that can only last for a short period of time. That is quite evident to anyone who has bothered to look at the 10-K filings or listen in on the conference calls of the producers. If you do you find most management groups talk about ‘funding gaps’ that would never exist if the shale gas story were correct.
Now you could argue that shale oil is different but I for one am quite skeptical. It is easy to make money on shale oil if you have operations in the sweet spots of the best shale formations. But you can’t extrapolate those results for all of the formations, which is what we need if the argument in the narrative above were to be true. As an investor in unconventional production I am much more skeptical than the naive optimists and the corrupt promoters that are given most of the opportunity to spin their stories. And as with my AGW positions I prefer to look at empirical evidence rather than models and narratives coming from ‘official’ sources.
The whole, “We have increased drilling because of our policies” goes right along with “Obamacare will decrease health care costs and the deficit.”
“Did you mean “oil sands”, Vangel?”
Yes I did. Tar sands is a much more appropriate name. Those of us who invest in the companies there understand the issues involved and can assure you that things are not quite as the naive optimists or the ecoterrorists are portraying them as being.
How can anyone want higher fuel prices and expect that it would be good for the economy? The cost of fuel is built into the cost of everything, including electricity, food, clothing, books, automobiles, everything. It would cause a general increase in the cost of living, which would prompt people to get a raise to cover it. That’s all that would happen. Increasing the cost of fuel does not affect fuel consumption in any significant way really, or alter our behaviour over the longer term, it only increases the cost of living. We simply increase our wages to offset it.
“And the production data is unaffected by moratoriums, revoked permits, or bureaucratic delays, right? Do you think a 6% drop in oil production on federal lands taking place at the same time as a 14% increase on state and private lands is just a coincidence? The drop in production on federal lands has nothing to with bureaucratic stonewalling. That oil just happens to be less recoverable than oil on private lands, right?”
That is not what I am talking about. I am bringing up the data from existing wells in some of the best areas in the best formations. That data is showing a huge depletion rate and EURs that are twice what they should be. In fact, the analysis of the production data seems to be indicating that the average EUR/well is about half the value claimed by the operators in the shale gas sector. This means that to break even you need a price of $7-$9 per Mcf.
Let me get back to a simple statement that is very hard to refute. For most of the past seven years we were told how profitable, abundant, and great shale gas was. But none of the claims came to be. Most of the larger players chewed through capital as they produced gas for a much higher price than they could get on the market. Now we have seen the larger players announce a move towards shale liquids and we are hearing the same old hype yet again. As a skeptic who is heavily invested in unconventional production I just don’t buy it. If you want to convince me show me the cash flow and the dividends, not some stories by the EIA or USGS.
The trouble with democracy, as it is implemented, is that you get people you don’t like elected to power: because they are plausible, or rich, or both, or …. whatever.
The only consolation is that democracy (as implemented) is a whole lot better than the alternatives on offer. So let’s put up with its limitations.
I would like WUWT to have less about the perceived iniquities of the elected leaders of a foreign land and more about the masthead topics (puzzling matters, nature, science, weather …).
You will have gathered that I am not a citizen of the United States, although I do admire the generosity and tenacity of its citizens.
The trouble with democracy, as it is implemented, is that you get people you don’t like elected to power: because they are plausible, or rich, or both, or …. whatever. The only consolation is that democracy (as implemented) is a whole lot better than the alternatives on offer. So let’s put up with its limitations.
I disagree. A tyranny of the mob is no consolation to those who prefer freedom and freedom is always a choice, particularly when you have a Constitution that makes clear that 99% of what the federal government does is not permitted by the law of the land as written. What you need is to stop compromising and insist on a limited government.
That said, liberty is too stiff a drink for most people, particularly those in the mainstream who have learned to be dependent on government telling them what to think and what to do. These people are foolish enough to actually believe that there is a material difference between the GOP and the Democrats and hope that if just the right man (or woman) were elected the system can remain as it is and things will still work out. Sadly, reality is what it is and not what these people hope it is.
jimboskype1939 says:
March 19, 2012 at 8:35 pm
Obama is not to be trusted. He is in election mode and is now playing to the centre so you can be sure he is NOT going to play up to the Warmistas.
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Just once I would like to be able to vote FOR a candidate instead of picking the lesser of two evils.
Former Senator John Danforth on those currently running for the Republican nomination:
“I’ve been watching some of these Republican debates and they’re just terrible… [I]t’s embarrassing for me as a Republican to watch this stuff.”
I am afraid I have to agree with him. It is as if the Republican party is trying to drive voters (Independents) away from them and towards third parties so that they can make sure Obama wins. Given that the R vs D is just a dog and pony show for the “Great Unwashed” and the moneyed folks own both parties I would not be surprised if that was actually the case.