Thursday, May 22, 2008

US: Only Country to Limit Its Own Energy Supplies

We have failed to increase our country's crude oil production. Domestic oil production has declined, to 1.9 billion in 2007 from 3.1 billion barrels in 1980, while imports increased to 3.7 billion barrels from 1.9 billion. We now importing about 60% of the oil we use.

One reason for the imports is that our public policy has forbidden offshore oil drilling for much of the estimated 85 billion barrels of recoverable oil and 420 trillion cubic feet of natural gas (an 18-year supply) that are on the Outer Continental Shelf, and another 10 billion barrels of oil in Alaska. Together they could replace America's imported oil for about 25 years, but the first President Bush issued a directive forbidding access to a significant portion of the Outer Continental Shelf. President Clinton extended the restriction through 2012 and vetoed legislation that would have allowed drilling in Alaska.

So America has large amounts of oil and gas, but our efforts to extract it have been significantly reduced by the federal moratorium on drilling. America remains the only nation in the world that has curtailed access to its own energy supplies. Meanwhile China will soon begin drilling for oil off Cuba and in Venezuela.


From today's WSJ editorial by Pete DuPont

17 Comments:

At 5/22/2008 1:35 PM, Anonymous Anonymous said...

so arent you just destroying nature to push off a problem for 25 years?

Delaying problems is not a solution we should be looking at. Fixing them is.

 
At 5/22/2008 2:19 PM, Anonymous Anonymous said...

For example:

New Oil Discovery in UK Continental Shelf

Release date: 01 February 2008

BP and its partner, Marathon Petroleum West of Shetlands Ltd, today announced a new oil discovery in Block 204/23, following drilling on the South-West Foinaven prospect, some 190 kilometres west of the Shetland Islands.

The Norwegians drill in their continental shelf as well. Norway is currently pumping out 3.2 million barrels per day from the Norwegian continental shelf.

However, Norway does limit production of oil in order to extend the long-term value of the assets.

And similar to the US ANWR, the Norwegian government last year decided the Nordland VI area off Lofoten would not be opened to further oil activity.

 
At 5/22/2008 2:23 PM, Anonymous Machiavelli999 said...

At $135/oil, you can mandate that the oil companies hire one enviromentalist for each employee for their offshore operations and they would go along with it because of the money to be made.

Each environmentalist can tell each worker what to do and what garbage to pick up.

 
At 5/22/2008 3:02 PM, Blogger matt said...

Machiavelli999,

Focusing on hugging trees is nice as a strawman, but you're missing the 1st commentators point, also the point I made in the earlier oil post, and the lesson to be learned from the pending insolvency of Medicare/Medicaid, from the interest-only ARMs that fueled the housing bubble, from the health care and legacy costs crippling the auto industry, and thousands upon thousands of credit card bankruptcy stories.

That lesson: Don't pass your problems on to tomorrow. If it's a problem today, it will be a bigger one tomorrow unless you fix it.

This issue does NOT have a quick fix. Drilling more wells right now might (MIGHT!) address pricing concerns for 25 years.

What happens if we drill the ANWR and don't have an energy solution in place when THAT runs dry? Same thing that happens when Medicaid runs dry, or when you take out that negative-amortization ARM, you hope to stick it to the next guy, right?

Truthfully, I don't care about the specific environmental concerns about the ANWR, but I still don't want to see drilling there. I believe in the free-market economy. While it's terrible short-term, I'm hopeful market forces will act to find an energy, transportation, material, and economic substitute for ground-drilled oil SOON. I don't want this solution postponed any longer.

 
At 5/22/2008 3:26 PM, Anonymous Is said...

Matt,

I don't think anyone is saying drill more wells, pump more oil, and forget about long-term solutions. No one is advocating delaying addressing problems in lieu of fixing the root cause as the first commenter is suggesting. It is a fact that we are dependent upon oil today and increased demand is affecting prices in the US and around the world. The US has oil in the ground but refuses to use it for various (stupid) reasons. Long terms solutions, such as alternative energy source development, should be developed in tandem with immediate increased domestic production. It is incorrect to suggest that the two are mutually exclusive, and drilling in the US means we cannot fix this problem. Actually, not increasing US production, not drilling more wells, and not building refineries has been a strategy that has been employed for quite some time in the US, and it has not resulted in a long-term (or short-term for that matter) solution yet. Why will continuing down this path all of a sudden result in viable alternatives emerging tomorrow?

 
At 5/22/2008 3:55 PM, Anonymous Anonymous said...

Do you honestly think if we use the short term solution of producing more oil domestically that we will still concentrate our efforts aggressively in finding oil alternatives? Look at Social Security and Medicare. These are big problems that we must deal with in the next 15-20 years and how many administrations decided it wasn’t their problem to deal with? How will this be any different?

The way I see it… if we lower the price of gas because we used our domestic oil, it is no longer an issue that needs to be dealt with. Then we have no oil reserves to use in the future if needed.

I say, we use our wealth as a country while we can to purchase oil from other countries and use their oil up while we work aggressively to eliminate/reduce our dependency. As a side effect, we pay a few dollars a month extra and save some of our land.

You dont have to be a tree hugger to put some sort of price on the environment.

 
At 5/22/2008 5:40 PM, Anonymous Anonymous said...

"America remains the only nation in the world that has curtailed access to its own energy supplies."

What is he talking about ?

The whole freaking business plan of OPEC revolves around " curtailed access ".

 
At 5/22/2008 10:19 PM, Blogger juandos said...

"so arent you just destroying nature to push off a problem for 25 years?"....

ROFLMAO!... Did you learn that sitting at the feet of some libtard in an overpriced but less than useless public school?

I'm guessing you didn't feel the least bit embarrassed by that statement, right?

"Delaying problems is not a solution we should be looking at. Fixing them is"...

Pray tell, what is the alledged problem besides the stupid choices we are making in regards to elected officials?

Instead of allowing free market forces to work their collective magic we have the stupids in STUPIDS in Congress trying to sue the price back down!

What matt seems to forget either on purpose or for some other reason with this comment: "That lesson: Don't pass your problems on to tomorrow. If it's a problem today, it will be a bigger one tomorrow unless you fix it" is that the present day problem of not having enough oil domestically has been developing over the last 30+ years...

Then matt contradicts himself with this: "Truthfully, I don't care about the specific environmental concerns about the ANWR, but I still don't want to see drilling there. I believe in the free-market economy"...

Who are you kidding matt? You know more believe in free markets than the Democrats and R.I.N.O.s in Congress do...

Some other anon says: "The way I see it… if we lower the price of gas because we used our domestic oil, it is no longer an issue that needs to be dealt with. Then we have no oil reserves to use in the future if needed"...

Obviously you need to take another look at it or do something to improve your eyesight sir...

There is NO evidence that the so called fossil fuels are running out or come from the rotting remnants of cambrian or permian life forms...

If hydrocarbons are renewable- then is "Peak Oil" a fraud?

 
At 5/23/2008 2:39 AM, Anonymous The Masked Millionaire said...

I really don't have anything to add to the conversation.

I just want JUANDOS to yell at me.

Live From Las Vegas
The Masked Millionaire

 
At 5/23/2008 6:07 AM, Anonymous Anonymous said...

People don't push off problems for 25 years, when the market is allowed to work. When the government gets involved and decides it knows better than the rest of us, that is when real solutions are pushed off.

What have we solved by making government the solution for healthcare and retirement?

What have we solved by having government decide that ethanol is the solution for the energy problem?

What has been developed in the computer industry with the lack of government involvement? Funny how they've been able to come up with new developments over and over again without the government telling them how to do it.

 
At 5/23/2008 6:43 AM, Blogger juandos said...

"I just want JUANDOS to yell at me"...

So is continuing to bolster the lies a good thing masked millionaire?

Just curious...

 
At 5/23/2008 7:05 AM, Blogger juandos said...

Domestic Drilling OK, Just 'Not in My State,' Senators Say

"There may be places that make sense, I am not saying, 'Let's not drill anywhere,' " Sen. Diane Feinstein (D-Calif.) said in response to the question. "But do I want to drill off the California coast? No. Do I want to drill in the Arctic in endangered areas? No."

Sen. Mel Martinez (R-Fla.), strongly endorsed drilling in the Arctic National Wildlife Refuge (ANWR) -- but not in his home state of Florida.

"I just don't think we should do it in areas like the Florida Keys, which are environmentally very sensitive," Martinez told Cybercast News Service
...

Yet again showing us we have exactly the government we deserve...

 
At 5/23/2008 9:11 AM, Anonymous Anonymous said...

Juando's says:
"ROFLMAO!..."
"STUPIDS in Congress"
"Pray tell..."

Who says this stuff? Let us know when you graduate High School and want to have an intelligent conversation.

 
At 5/23/2008 9:22 AM, Anonymous Anonymous said...

More jandos comments:

"I just don't think we should do it in areas like the Florida Keys, which are environmentally very sensitive," Martinez told Cybercast News Service...

"Yet again showing us we have exactly the government we deserve..."

------

Someone else's comments:

When the government gets involved and decides it knows better than the rest of us, that is when real solutions are pushed off.

-------

These comments are fine in your ivory tower of your university. In the real world, we have to worry about a thing called Ethics.

In economics, you dont have to worry about these things because you cannot graph them so they are ignored. If they dont shift the production possibility frontier or the supply/demand curve they are ignored.

We seem to forget that all things in life are not so cut and dry. This is an ethical decision here not an economic decision.

 
At 5/23/2008 9:55 AM, Anonymous Is said...

Explain then. Drilling in ANWR is unethical?

 
At 5/23/2008 3:53 PM, Anonymous Anonymous said...

surprised you would even have to ask if destroying the environment is an ethical decision. no reason to debate this one. Type "ANWR ethics" into google. There is enough people already debating the ethical considerations on this topic.

 
At 5/23/2008 5:23 PM, Anonymous Anonymous said...

nothing more hilarious than people who know nothing about ethics trying to argue that drilling in a limited part of the ANWR is an ethical violation.

So, tell us how that balances against the loss of economic activity? The loss of jobs? The rising cost of heat for poor families?

Please use that wisdom (I mean you seem to know everything) and tell us how drilling in a tiny corner of that desolate wasteland is somehow more important than all of the things for which energy is utilized (all of the many positive things).

And if leaving this desolate wasteland is ethically more important than getting energy from it, where on earth could we possibly get energy that would pass your 'ethical test'?

 

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