Guest Post by David Middleton
During his State of the Union Address, President Obama had a few things to say about energy snd I have a few replies.
Pres. Obama: We buy… less foreign oil than we have in 20 [years].
Wrong!!! We buy more “foreign oil” now than we did 20 years ago.
Pres. Obama: We produce more oil at home than we have in 15 years.
What do you mean by “we”? You don’t produce any oil.
See that decline in Federal Gulf of Mexico production from ~1.7 MMbbl/d to ~1.4 MMbbl/d since early 2010?
You actually did build that.
Pres. Obama: That’s why my administration will keep cutting red tape and speeding up new oil and gas permits.
Drilling permits that once took 30 days to be approved now take more than 180 days. Even relatively simple things like the approval of development plan (DOCD) revisions are sometimes drawn out to nearly 300 days. As of a year ago, the average delays for independent oil companies are currently 1.4 years on the shelf and almost 2 years in deepwater:
Between the “permitorium” and high product prices, many of the best, most capable drilling rigs have been moved overseas. Once we manage to get permits approved, the delays in obtaining a rig can be almost as long as the permit delays were. In this “dynamic regulatory environment,” wells can’t be drilled quickly enough to compensate for decline rates, much less to increase production. This is why the production rate in the Gulf of Mexico is still 300,000 bbl/d lower than it was prior to Macondo. The only red tape you have cut, is red tape that your maladministration created.
Pres. Obama: So tonight, I propose we use some of our oil and gas revenues to fund an Energy Security Trust that will drive new research and technology to shift our cars and trucks off oil for good.
What do you mean by “our oil and gas revenues”? You don’t generate any oil and gas revenue. The Federal gov’t does generate some revenue from the private sector development of Federal mineral leases.
Federal mineral revenues for FY 2012 were HALF of what they were in FY 2008!
The decline in Federal mineral revenues is really ironic considering the fact that the US Navy can’t afford to deploy a second aircraft carrier to the Persian Gulf due to a lack of revenue. The reason for maintaining a strong naval presence in the region is the free flow of oil at market prices (the Carter Doctrine). The Navy only expects to “save several hundred million dollars” by not delaying the deployment of CVN 75 USS Harry S Truman. The royalty payments from the missing 300,000 bbl/d of production could have been as much as $1.8 billion and have more than covered the cost of the deployment.
What’s even more ironic? We’re importing 50% more from the Persian Gulf than just three years ago!
The actions of this administration have both increased our need to maintain freedom of navigation in the Persian Gulf and reduced our means to do so.
Sources:
U.S. Energy Information Administration, U.S. Imports by Country of Origin
U.S. Energy Information Administration, Crude Oil Production
Quest Offshore Resources, Inc. The State of the Offshore U.S. Oil and Gas Industry, December 2011
Office of Natural Resource Revenue, Statistical Information
Don K,
I’m running Opera 12.14 on Win XP and also can’t see the photobucket images. Must be apply generally to Opera versions as my Firefox displays them.
“Pres. Obama: So tonight, I propose we use some of our oil and gas revenues to fund an Energy Security Trust that will drive new research and technology to shift our cars and trucks off oil for good.”
This sounds like batteries or hydrogen. However lest “we” forget it was Bush that started the Hydrogen program (to the tune of 1.2 billion) and Obama that canceled it:
http://www.motherjones.com/environment/2003/05/hydrogens-dirty-secret
http://www.treehugger.com/cars/obama-kills-hydrogen-car-funding.html
People tend to side with one or the other (kind of like a football team) and that is always a mistake since politicians tend to have both better and worse parts to their programs (depending upon your personal viewpoint and standards). However in recent history I don’t see either side doing especially well.
How Green Was My Bankruptcy? U.S. Navy Edition.
The Navy and DOE are spending $210 million to build two biofuel refineries to produce $27/gal biofuel even though there is no realistic scenario in which biofuel costs less than twice as much as fossil fuels and the production will not exceed a tiny fraction of the Navy’s needs…
Let’s look at the RAND report…
What the US Navy is attempting to do is the equivalent of building a home-version of the UNIVAC in 1957. The only difference is that in 1957, there was no alternative to the UNIVAC.
The top two oil wells in the Gulf of Mexico are currently producing more than 50,000 barrels per day.
As of July 2012, there were 21 oil wells in the Gulf of Mexico producing more than 10,000 barrels per day. Those 21 wells produced a combined 322,000 barrels of oil per day. Federal Offshore Gulf of Mexico Field Production has averaged 1.3 million barrels of oil per day in 2012, despite the lingering effects of the unlawful moratorium and permitorium.
GOM vs Seeds & Chicken Fat
Despite the fact that biofuels can’t provide even a fraction of the Navy’s consumption at more than twice the cost of conventional fuels, the Navy is proceeding with full-scale production (not just R&D).
The biofuel is currently about $27/gal.
They blend it (50-50)with conventional fuel runs around $3.30 gal. The result is a blend that costs about $15 gal.
They claim that they can get the biofuel cost down to about $11/gal, where the cost of the blend would be about $7/gal.
The DOD uses about 320,000 bbl of oil per day. The RAND paper says that the total national potential for biofuel production by 2020 is in the neighborhood of 50,000 bbl/day.
I guess the “good news” is that the low production rate will prevent the DOD from p!$$ing away more than $433 million per year on biofuel between now and 2016. Of course, if they weren’t p!$$ing away $433 million per year on biofuel, they could afford to deploy that second CVN to the Persian Gulf.
Only if you are ignorant of the fact that crude oil (petroleum) and refined petroleum products (gasoline, diesel, lubricants, etc.) are two different things.
They are as different as iron ore and steel.
You should have seen my original draft… 😉
In response to CodeTech remark (4:55 AM on 14 February) about how this post
David Middleton (7:06 AM on 14 February) responded:
…to which I can only respond “Please permit us, kind sir!
“The stuff about ‘we’ and the federal v private argument is pure politics and just not necessary”
So let me get this straight, AndyL. The President can lie with impunity because he is a politician engaging in pure politics. He can take credit for accomplishments he personally tried to squash. You feel justified in defending his right to delude the people, heaping praise upon himself (via his vague use of the word ‘we’) while vilifying those who actually produced the accomplishment. Is that how you feel?
The point that Mr. Middleton is making is that the President does not have complete control over the private development of energy, but he does have more authority over federal energy production. Where the president has authority, production was way down. Where private entities have more authority, production was up, despite the Presidents policies and limited powers that made it more difficult to accomplish this achievement. Simply put, the President took credit for something his actions opposed.
I am not sure how Mr. Middleton could have pointed out this blatant deception without making the distinction between federal v private energy production. I am not sure how he could of revealed this callus lie without pointing out the Presidents vague us of the word ‘we’. Perhaps you could rewrite Mr. Middleton’s words in such a way that would reveal the Presidents deception without a discussion of federal v private. It would be like writing about Nixon’s downfall without the use of the words ‘Watergate’ and ‘cover up’. The words are rather vital to the story, aren’t they?
If a character in a movie takes credit for something that he actually tried to thwart, that character is instantly recognized as scum, and is almost always the antagonist of the story. At best, he is viewed as pathetic. Yet, when the President does it in the midst of a stream of lies, you feel the need to defend him, by attacking those who reveal the deception. Why is that? What is this really about? Is it the ‘politics’ of which you accuse Mr. Middleton?
You should have seen my original draft… 😉
I scrubbed the final draft pretty hard to remove pejorative barbs, missing a few typos in the process. Perhaps you can point out the pejorative barbs and I’ll ask to have them redacted.
I guess the fat lady has sung. 😉
Surprising? Since when is it a requirement for a politician to be accurate and honest? The job is closer to being a fiction author that has a hidden agenda that usually involves inventing ways to get at your cash.
It’s possible the December and January numbers continue the downward trend in foreign oil, making his claim true.
After the oil spill in the Gulf of Mexico BP deserved to be fined and punished. Other companies did not. BP’s record of infractions was terrible, but others were not. This may be a generalization, but it sure seemed to me that where other companies spent millions and even billions making wells safer, BP spent millions and even billions on politics (and perhaps bribes.)
Obama’s entire policy after the Gulf oil spill seemed aimed at making it very difficult to drill, and also at punishing oil companies in general, whether they did wrong or not. Over and over, as I read the news, I would go into a slow burn about his bans.
The fact oil companies have done so well, against such adversity, is amazing to me. I honestly expected we’d be in serious trouble by now, due to Obama’s idiotic actions.
For Obama to take credit for any increase in oil production anywhere is utter gall.
The mainstream media never will speak truth to power, these days. Therefore I am thankful Dave has gotten some of these facts out for the public to see. If his tone is a bit peevish, I don’t blame him one bit.
Robin Edwards says:
February 14, 2013 at 5:59 am
I remain surprised that the USA seems unable or unwilling to adjust oil usage by the mechanism used widely in Europe, and especially here in the UK. The rulers simply impose a tax or duty on fuel sales (gasoline and diesel) that is over 60% of the pump price. Transport companies don’t like it, the public hates it, manufacturing companies complain about the extra costs they have, and our roads remain crowded and ill maintained. Who in the USA will bite the bullet?”
You are absolutely correct. I maintain that gas could easily be $12 or $15 a gallon and the roads would still be packed full of cars and trucks every single minute of every single day. I’ve debated at what price per gallon would it actually start decreasing the number of miles Americans drive? Would it be $20 per gallon? $25? Certainly an instant jump to that number would cause a momentary stall in traffic, but it would resume once the shock was over. If the price gradually climbed there would be complaining but not effect on traffic. But to what price could it plateau before impacting traffic?
AndyL says:
February 13, 2013 at 11:32 pm
I don’t come to this site for politics.
It’s particularly irritating to see posts like this when the beneficiaries of the argument are the oil industry, because other people will use this to “prove” links between sceptics and the oil industry.
On the contrary, energy issues are closely tied up with climate. We dont have to kow-tow to the libero-fascist elite and their genocidal loathing of the fossil fuel industry. They can put their predjudices where the sun does not shine – they have no place here. There is absolutely no reason not to have a serious discussion of oil and energy related issues.
We ARE importing less oil than in 20 years, IF you look at percentage of oil used. The president could have been clearer about this. However, the percentage is a more relevant measure if you compare present to past, as you have to factor in population growth.
David,
Great post.
If you are seeking a larger audience however, stop falling into the Alinsky trap of writing mad.
The only hope we have of convincing a wider audience of how bad this Administration’s policies are is to stick as close as possible to the facts.
Leave the hysteric arm waving and hyperbole to the climate/enviro extremists.
Stick to the facts of how bad the policies are and it will be those pushing the policies who will shoot themselves in the foot by way of temper tantrums, etc.
Your stats showing how blatantly wrong the oil import assertion is should be the focus, not which pronoun was chosen in the speech.
Respectfully,
Bair Polaire says:
February 14, 2013 at 3:07 am
The tone of this post is a little childish.
“You don’t produce any oil.” Really?
—————————————————————
Maybe. Some might argue that the President opened this door himself here:
(President Obama July 2012)
Since President Obama was the one who brought up who did what in the first place, I don’t think it’s outrageous to frame responses in this light.
NotBuyingIt says:
February 14, 2013 at 6:51 am
…
People tend to side with one or the other (kind of like a football team) and that is always a mistake since politicians tend to have both better and worse parts to their programs (depending upon your personal viewpoint and standards). However in recent history I don’t see either side doing especially well.
——————————————————————-
I absolutely agree. I’m not much interested in tearing up the President’s B.S. when all Presidents from both parties have basically been B.S.’ing the public since time out of mind in their SOTU’s. It generally does seem to come across as just rooting for my own team, so what’s the real point? If people don’t understand that Presidents B.S. then nothing I can say is going to help them anyway.
MostlyHarmless says:
Roy says:
February 14, 2013 at 1:38 am
How on earth do you expect a head of state to speak?
Some facts, occasionally, perhaps.
It was perfectly obvious that I was referring to David Middleton’s criticism of the use of the word we by Obama. I pointed out that it is quite natural for a head of state to use the word we when referring to his country’s people. David Middleton’s response that the private sector does not work for or report to him [Obama] is a ridiculous evasion of the point that I was making. What nationality are most of the people in the US private sector? Are they mainly US citizens or do you think they are mainly immigrants?
Did George Washington, Abraham Lincoln, Franklin D. Roosevelt, Jack Kennedy, Ronald Reagan or any American president you care to mention never use the word “we” when talking about the American people?
No wonder Obama was re-elected when some of the criticism directed at him is so irrational.
No. It isn’t possible. We’re talking more that 2 million barrels per day.
In 1992, the average total crude oil imports were 6.1 million barrels per day. In 2011, the average was 8.9 million barrels per day. Over the most recent 12 month period (Dec-11 through Nov-12) the average was 8.6 million barrels per day.
Unfortunately, it is impossible to separate this issue from politics and the idiocy of government, both Democrat and Republican. Justifying what Obama has done by claiming that Bush did it too only makes an case for less government involvement. Bush pushed for fuel cells and ethanol from switchgrass, and Obama pushed solar, wind, and corn ethanol, all bad ideas. Lawyers making technical decisions for political gain is not working out very well.
Unencumbered by the need to be PC, I can call the President what he is, a serial liar. Lying works for him, especially during a campaign, so that’s why he is on a perpetual campaign. Fly in, make a speech, no questions are asked, the people cheer, back on the taxpayer-supplied airplane, repeat.
Thank you Mr. Middleton for taking the time to bring the energy and security issue to light. Why would we reduce our forces in the gulf at this time, when that area is so unstable, more unstable than in probably the last 20 years? Iran will have a bomb with means to deliver it soon, Egypt is near revolution again, Syria is near collapse, Iraq is a disaster waiting to happen, the stability of most of north Africa is questionable, etc. Obviously, the risk analysis that CIA undoubtedly prepared was rejected since it did not reinforce the Presidents position.
We should be focused on achieving energy independence asap, not trying to slow permitting, close coal fired plants, and find some way to stop fracking. Government is failing us, and Obama’s answer is more government.
If you actually looked at the percentages, you would see that the U.S. imported 46% of its crude oil in 1992. In 2011 it was 61%. Over the most recent 12 months of data, it has been 57%.
On a percentage basis, our crude oil imports are still higher than they were in 1997.
However, 8 to 9 million barrels per day is not less than 6 million barrels per day, no matter how you spin it. His false claim is derived from the sum of crude oil and refined products.
Oil + Refined Products ≠ Oil
“We” as in the American people do not produce oil or generate oil & gas revenues, any more than “we” as in the American people generate Wal-Mart’s revenue or “we” as in the American people build cars or “we” as in the American people play Major League Baseball or “we” as in the American people farm crops or “we” as in the American people perform neurosurgery.
My objection is to the collectivist (AKA communist) use of “we.” Now, I might not be so peeved by it, if not for this classic…
Re less crude oil import percentage- wise
http://www.businessweek.com/news/2012-08-23/u-dot-s-dot-oil-imports-to-seen-hitting-20-year-low-42-percent-of-use
Sorry, I forgot to quote my reference.
oldfossil says:
February 14, 2013 at 1:55 am
“…to shift our cars and trucks off oil for good.”
Off oil and onto coal. Right.
Wrong. Off oil and onto liquified natural gas.
Burning natural gas emits much less SO2 and NO2 than coal or oil.
And CO2, but CO2 is not a pollutant.
Business Week is about 12% off the mark…
Irrespective of the EIA bureaucrat’s narrative, the EIA’s data show that over the most recent 12 months (Dec-11 through Nov-12) the US imported 54% of its crude oil consumption.