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House Passes Final OCS Bills, Gives Hope to Concerned Consumers

House Passes Final OCS Bills, Gives Hope to Concerned Consumers
House Agrees to Set Permitting Timelines and Move Forward with Progressive Leasing Plan to Increase Access to Domestic Energy Sources

WASHINGTON – In response to months of high gas prices, low employment rates and civil unrest in foreign energy-producing nations, a bipartisan majority of the U.S. House of Representatives passed critical legislation that aims to retract the Administration’s de facto moratorium on taxpayer-owned oil and natural gas production along the U.S. Outer Continental Shelf (OCS), unleashing significant domestic energy resources and putting hard working Americans back to work. The final bill – the Reversing President Obama’s Offshore Moratorium Act (H.R. 1231) – successfully passed in the House of Representatives today following last week’s passage of the bipartisan Restarting American Offshore Leasing Now Act, and yesterday’s passage of the Putting the Gulf Back to Work Act (H.R. 1229). Collectively, the bills responsibly reinstate stalled lease sales in the Gulf of Mexico and offshore Virginia, set definitive timelines for considering permits specifically in the Gulf Coast region, and require the Obama Administration to move forward with lease plans

Consumer Energy Alliance (CEA) president David Holt released the following statement regarding passage of the OCS-related bills:

“CEA applauds leaders in the House for hearing the call of concerned consumers and passing crucial legislation that would finally provide access to America’s offshore energy resources and a potential solution to the high energy prices Americans are facing heading into the summer season. More immediately, bills like this will help put the thousands of Americans across the country – employed in manufacturing, transportation, steel and energy sectors that rely in steady supply of oil and natural gas – back to work, allowing them to provide for their families in these difficult economic times.  At a time when the nation needs all our conventional and alternative energy resources, it is critical that we remove artificial barriers to the primary economic drivers to our economy – oil and natural gas.

“Many consumers only see the affects high energy prices have on their individual wallets and paychecks. However, these three bills rightfully address and remedy, at least initially, a fundamental failure by bureaucrats in Washington to provide access to domestic energy resources, while generating significant revenue to help reduce the deficit and bolster our economy. Without a healthy domestic energy supply, the cost of doing businesses increases and simple economics tell us that jobs and revenues suffer under those circumstances. A more efficient permitting process and access to previously unavailable regions of the OCS can help both the individual – through lower costs and better jobs – and the nation as a whole by decreasing national debt and generating revenues that stay here at home.

“Collectively and individually, these bills demonstrate an effort by the House to change the course of a difficult situation Americans find themselves in, and we now must look to the U.S. Senate to continue on this positive path forward.  Our domestic energy production isn’t a partisan issue, it is an American issue.”

CEA applauds vote in U.S. House to develop energy resources offshore

CEA applauds vote in U.S. House to develop energy resources offshore

WASHINGTON – New access to abundant energy resources offshore could soon be granted to American energy consumers thanks to historic legislation passed today in the U.S. House of Representatives. The bill, H.R. 1230, orders the Interior Department to conduct lease sales on four separate energy-rich tracts along our nation’s Outer Continental Shelf (OCS) – two in the central Gulf of Mexico, one in the western Gulf, and one more than 50 miles off the coast of Virginia.

Following the vote, Consumer Energy Alliance (CEA) executive vice president Michael Whatley issued the following statement:

“Today’s vote in the House essentially asks the administration to do what it should have done a long time ago. It compels the Interior Department to put in place a plan to get fair value for the taxpayer on the massive reserves of energy currently being held captive offshore – resources that are owned by all Americans and which our country needs access to now more than ever before.

“It’s now incumbent on the Senate to follow suit, not only in view of the new jobs and additional revenues that such an action would create, but also with an eye on bringing more American energy online for consumers, lowering prices and reducing imports in the process.”

Earlier this month, CEA launched a campaign designed to empower everyday Americans with the tools they need to ensure their voices are heard in Washington. The campaign, coined More Energy Now, also includes an online feature capturing the up-to-date status of America’s growing reliance on foreign energy – along with a rolling counter of how much Americans are currently sending overseas to acquire the energy they need.

Progress and silver linings

This week, we take a break from the significant challenges facing the national economy and our national energy policy that we have detailed exhaustively for the past few months. While rising oil prices continue to pose challenges for consumers and businesses alike, we must give credit to the individuals and organizations that have navigated these challenges to make some positive changes in the way they consume energy.

We recently heard about this study, which has been coined the Green Recession study, finding that cash-strapped consumers have become more diligent about taking the small steps that they have in their power to conserve energy. Little things like turning off the lights in empty rooms or turning down the thermostat may have been motivated out of a desire to save money rather than power. But the end result was the same, and it serves as a reminder that we all can take small steps even while we call for larger changes in national policy.

Another inspiring energy story comes from Starbucks, which last year reached its goal of using renewable energy as the source of more than half the electricity used in all its North American stores. The company did not meet its goal of reducing energy consumption in its stores by 25%, but they have redoubled their efforts to do so while also aiming to run its North American stores on 100% renewable energy by 2015. Starbucks deserves credit not only for working toward such lofty goals but also for sharing its progress and admitting to mixed results.

As Starbucks shows, conserving energy is not easy, especially at a time when many consumers and businesses have already cut expenses down to the bone. But the behaviors we adopt in our homes and places of business are often the only way we can respond when the economy falters.

Of course, better national policies are needed to help make energy a growth engine rather than a drain on our economy. After watching oil and gasoline prices rise for much of the year, we got a powerful indication of just how vulnerable the economy remains. GDP growth slowed significantly during the first quarter of the year, with rising gasoline prices cited as a key factor slowing consumer spending.

 

Coastal Governors Announce Formation of Outer Continental Shelf Governors Coalition

Offshore oil rig with workers

Coastal Governors Announce Formation of Outer Continental Shelf Governors Coalition
U.S. State Officials Use OTC Conference As A Forum to Discuss More Federal-State Communication on Oil and Gas Development in the OCS

 

HOUSTON – Governors from four key coastal U.S. states announced today the formation of the Outer Continental Shelf (OCS) Governors Coalition, a group whose goal will be to promote a constructive dialogue between the federal government and states when it comes to the responsible development of energy resources offshore.

The coalition’s mission was described in an open letter of invitation to governors from other coastal states sent today by Louisiana governor Bobby Jindal, Texas governor Rick Perry, Mississippi governor Haley Barbour and Alaska governor Sean Parnell. The engagement was officially announced by Governor Barbour during a panel discussion organized by Consumer Energy Alliance at the Offshore Technology Conference in Houston. Governor Barbour was joined by U.S. state officials from each of the participating states.

The letter explains the critical role that offshore oil and gas development has played in creating thousands of high-paying American jobs, and laments how federal decisions affecting the industry have been made with little consultation of state officials. The governors say the coalition will serve “as a mechanism to foster an appropriate dialogue between the coastal states and the Administration and ensure that future actions are done with adequate state input.”

Consumer Energy Alliance president David Holt moderated the panel during which the announcement was made, and issued the following statement:

“Consumer Energy Alliance, representing both producers and consumers of energy, supports and applauds the collaboration of these four governors in promoting an open discussion about the benefits of producing American energy offshore, not only for their individual states, but for the entire nation and our economy. In a post-Macondo environment, these governors have seen the federal government significantly limit their ability to access critical domestic natural resources along the Outer Continental Shelf, subsequently denying their citizens and the entire nation reasonable energy prices and high-paying jobs in an unstable economy.

“By simply communicating effectively and more often, federal and state regulators can gain a better understanding of the benefits of safe offshore oil and gas exploration and production, and come to a consensus on how to make the most of American energy resources that will help improve domestic energy security, U.S. competitiveness and our economic well-being..Successful domestic oil and gas development will not only provide us with a more secure supply of energy, but it will also provide more opportunity for industries across all sectors of our economy.”

Read the full letter HERE.

 

May 2011 Newsletter

May 2011 CEA Newsletter
Issue 50


While you read this newsletter

In the time it takes you to read this month’s newsletter, the United States will have imported thousands of barrels of oil at a cost of hundreds of thousands of dollars. And that’s if you’re a fast reader.

We hear so much about the large volumes of oil that we import and the economic impact of all this oil from abroad, but, like all large numbers, these figures can be difficult to comprehend. CEA has recently introduced a handy tool, the Imported Oil Counter, a running ticker to illustrate just how rapidly all the oil we buy from abroad is adding up: Since the start of this year alone, the U.S. has imported well over one billion barrels of oil at a cost of more than 115 billion dollars. That’s a lot of money being sent to foreign countries that could be put to better use here at home.

The Imported Oil Counter is part of a larger CEA effort, More Energy Now, aimed at building support for policies that encourage more domestic energy production through more efficient permitting processes, more expansive leasing, along with continued support for alternative energy development.  While recognizing that North American energy – including vital supplies from Canada and the need for an expanded pipeline to carry Canadian oil sands – must be made a priority, More Energy Now features a petition to President Obama, enabling visitors to the site to quickly sign up and voice their support for policies encouraging use of our natural resources.

As of this writing, the average price for a gallon of gasoline in the U.S. is rapidly approaching $4 a barrel. This chart illustrates how close today’s prices are to levels seen during the summer of 2008, when surging fuel costs quickly exacerbated a fledgling recession. There are, of course, many long-term reasons related to national security and economic stability that the U.S. cannot sustain its dependence on imported oil. But today, with the national economy perched on the most fragile of recoveries, the need to boost domestic production and bring down oil prices is particularly urgent. With the More Energy Now campaign, we also hope to impress upon consumers and lawmakers alike, that the national energy strategy we need, is at its core, quite simple. We need policies that will provide greater access to our energy reserves, and we need them now.

David Holt

 

Tell the Obama Administration We Need Greater Energy Security and Lower Fuel Prices

In the face of rising prices at the fuel pump and global events that threaten our oil supply, Americans have a unique opportunity to take action.  The Keystone XL pipeline, which will carry oil from our ally Canada to Gulf Coast refineries, will mean greater national security, a stable fuel supply, and economic growth in the US.  However, the project must be approved by the Department of State before construction can begin.  Unfortunately, instead of approving the project on its merits, the Obama Administration continues to stall.

If the Obama Administration decides not to grant the Presidential Permit, Americans will continue to be at the mercy of oil-producing countries like Saudi Arabia and Venezuela.  It will also mean that we’ll continue to pay more at the pump.  For more information on the benefits of Keystone XL, click here.

Take Action Here

The State Department is currently seeking public input on the pipeline’s Supplemental Draft Environmental Impact Statement.  Please write Secretary Clinton and tell the Obama Administration that Americans want more energy security and lower fuel prices – not the other way around. The comment period closes June 6, 2011.

High Electricity Bills Too? Sure, If the EPA Has Its Way 

It’s no secret Americans are struggling with the high costs of daily living – food, gasoline and even the price of diapers have all risen in the past few months.  Right when you thought enough was enough, your electricity bill may become the next victim if Washington bureaucrats don’t get it right. Currently, the U.S. Environmental Protection Agency (EPA) is developing new regulations on power plants that could inadvertently close dozens of U.S. utilities and manufacturing plants, and there’s no backup power switch for consumers to turn to.  And as everyone knows, less supply and more demand equal higher prices.

If implemented, these new rules could force approximately 400 facilities to install unnecessary or ineffective environmental technologies to their16 cooling system operations.  Scientific studies have demonstrated these plants have little if any negative effect on surrounding ecosystems.  Moreover, these upgrades will cost facilities millions of dollars – costs that will inevitably be passed on to consumers.  Consumers may not be left in the dark, but they will be left with a significantly higher electricity bill.

Take Action Here

The EPA is currently accepting comments on its proposed power plant cooling systems regulation.  Below is a draft letter that includes a few ways we think this regulation can be amended to ensure consumers aren’t left with the bill. But, please feel free to edit the letter as you see fit.

For more information, please reference these materials from our CEA affiliate, Nuclear Energy Institute.  In addition, the federal register notice can be found here. The comment period closes July 19, 2011.

 

As Energy Day 2011 approaches, momentum is really picking up.  There has been a couple of interesting Energy Day developments throughout the month of April.   On April 12th the second Energy Day Steering Committee meeting took place at City Hall in downtown Houston.  CEA began its work on the ECAP program with three exciting events; The Science and Engineering Fair of Houston (SEFH), the CSTEM International Challenge and Energize! Houston.  Each event was a huge success and we look forward to the upcoming ECAP events.

We are now meeting with the individual sponsors to get details on exactly what type of display they will be having on hand at Energy Day.  There will be plenty of eye opening and interactive displays so don’t miss out on this exciting opportunity to see what innovations the Energy Industry has to offer.

Here is the list of confirmed Energy Day sponsors:

ABC-13, Air Transport Association, American Public Power Association, Apache, Bug Ware, Inc., Caterpillar, City of Houston, ConocoPhillips, Consumer Energy Alliance, Consumer Energy Education Foundation, Cooperative for After-School Enrichment (CASE), CSTEM Teacher & Student Support Services, Earth Quest Institute, Eco-Holdings Engineering, El Paso Corporation, Energy People Connect, Environmentally Friendly Drilling Program, Foundation for Energy Education, Greater Houston Partnership, Green Mountain Energy. Halliburton, Harris County Department of Education, Houston Advanced Research Center, Houston Area Land Rover Centers, Houston Independent School District, Houston Museum of Natural Science, Wiess Energy Hall, Houston Northwest Chamber of Commerce – Energize! Houston, Houston Renewable Energy Network, Houston Technology Center, HoustonWorks USA, Independent Natural Resources, KBR, Inc., Knowledge Is Power Program (KIPP), Lone Star College, Momentum Luxury Group, NASA-Johnson Space Center, National Algae Association , Offshore Energy Center, Science & Engineering Fair of Houston, Shell, 60 Plus Association, Solar Tour Houston, Statoil, Texas Alliance for Minorities in Engineering, The Wind Alliance, TransCanada, TXU, Western Energy Alliance, University of Houston , University of Texas, U.S. Chamber of Commerce Institute for 21st Century Energy, YES Prep Public Schools

We need your participation and involvement to make this an outstanding event! Please email Kathleen atKKoehler@consumerenergyalliance.org for details.

Energy Day Academic Awards Program- Upcoming Events

While Energy Day is still a little over six months away, the Energy Day Academic Awards Program got started in April with 3 events and will continue with one event in the month of May. Each event will count towards the Energy Capital Academic Program (ECAP) for all of those who attend.  For more details on the Energy Day Academic Awards Program or the Energy Capital Academic Program please email Craig at CKoshkin@consumerenergyalliance.org.

Houston: Energy City of the Future 2050 Competition

May 13, 2011
Houston Community College: Northeast Campus Energy Institute, Houston, Texas

The Houston: Energy City of the Future 2050 Competition provides Houston-area middle and high school students with an opportunity to explore Houston and its energy industry. The project is designed to focus on workforce development and to encourage youth to pursue careers in the energy and engineering fields. Student participants will spend the spring 2011 semester working in four-person teams to learn about energy and petroleum-based industries.

Over the course of the program, youth participants will engage in energy related enrichment activities and meet with energy and petroleum based industry representatives. Students will be asked to: 1) create a scale model of Houston for the year 2050 demonstrating energy development, usage and delivery; 2) develop a marketing campaign explaining how the energy industry will play a vital role to Houston in the future; and 3) design a public service announcement that sells their energy efficient plan to the greater Houston community. At the culminating event, volunteers from the local energy industry will judge student entries in all three areas.

The culminating event for the Houston: Energy City of the Future 2050 Competition will be held on Friday, May 13, 2011 at the Houston Community College: Northeast Campus Energy Institute, located at 555 Community College Drive, Houston, Texas, 77013. Winning student teams will receive an award and recognition from Consumer Energy Alliance during the Energy Day event on October 15, 2011.

This project is implemented by CASE, the Cooperative for After-School Enrichment, a division of Harris County Department of Education. The CASE mission is to strengthen, support and sustain after school for all children. The Houston: Energy City of the Future 2050 Competition is sponsored by Consumer Energy Alliance and is supported with in-kind contributions from the Houston Community College: Northeast Campus Energy Institute and the Greater Houston Partnership.

 

Spring Clean Your Energy Use!

Each year, people across America take part in the annual tradition of spring cleaning their homes, garages, work places and lifestyles, but consumers should give their energy use a good once over too!

Heating and cooling costs are a significant part of household budgets throughout America – on average 43 percent of utility bills! There are many free and low-cost strategies consumers can put into action to lower these costs. Spring cleaning energy use is beneficial because not only does it save consumers a few bucks, but it also focuses consumers on being good stewards of energy resources.

This spring, there are five top steps to take in streamlining your energy use:  1) Look for assistance from your local utility or state; 2) Conduct an energy audit; 3) Have your cooling system serviced; 4) Find and seal your air leaks; and 5) Install a programmable thermostat, according to EnergySavers.gov, a U.S. Department of Energy website devoted to providing tips to the American public on energy consumption.

The five spring to-dos are part of EnergySavers.gov’s “Stay Cool, Save Money” campaign, which focuses on providing consumers with ways to save money during the spring and summer.  Find out more ways to prepare for summer’s energy costs…

$116 billion and counting

What can you buy for $116 billion? When it comes to imported oil, not all that much actually. $116 billion is the amount the United States has spent on imported oil since January 1, 2011. That’s right, the cost of all that oil – or rather the amount of money we are sending to foreign economies because we are not producing enough energy here at home – adds up very quickly.

As part of our new More Energy Now campaign aimed at promoting more domestic energy production, CEA has developed this Imported Oil Counter, keeping a running count of the amount of oil we’ve imported since the start of the year, and the amount it has cost us. Our hope is that this will cast into more graphic relief the magnitude of our dependence on foreign oil.

Of course, as the price of oil goes up, as it has in recent months, the ticker runs faster. There are a few ways to think about this. First, price volatility and price spikes are often the result of foreign sources holding the cards, fixing supply, and effectively setting the price. Second, these higher prices pose a serious threat to our economy on many levels, from eroding individuals’ disposable income to elevating the cost of doing business for small businesses and major corporations alike. When operating costs become really high, these businesses often have no choice but to pass them on to already strapped consumers. Finally, at the very time these conditions are threatening our fragile economic recovery, these higher oil costs mean that we are sending even more cash overseas. This is money that could be better put toward domestic industry, and of course, domestic jobs.

If you are even a little familiar with our national energy policy, you probably know that the amount we spend on imported oil is staggering. Hopefully, this rapidly moving Imported Oil Counter, which shows our foreign oil expenditures growing by $1 million in a matter of minutes, will underscore the urgency of a new and improved policy that supports more domestic production.

 

More Energy Now Tells Obama Administration to Reduce Dependence on Foreign Oil

More Energy Now Tells Obama Administration to Reduce Dependence on Foreign Oil
Consumer Energy Alliance launches online campaign giving consumers direct line to the White House

HOUSTON – America’s dependence on foreign oil threatens our country’s economic and national security and has continued to grow over the past decade.  What’s the problem?  In short, our county lacks a national energy strategy that is committed to producing more energy here in the United States. The escalating price of fuel underscores this fact while squeezing budgets tighter and tighter.  Still, most American consumers don’t know exactly how much we shell out to foreign countries every day to acquire the energy resources we need, or what they can do to begin reducing this dependence once and for all.

Thanks to a new effort by Consumer Energy Alliance (CEA), consumers now have a way to tell policymakers that we need more American energy, and we need it now. Accessible at moreenergynow.org, CEA’s petition to President Obama urges the government to ensure access to American resources and support increased energy production – all as a means to lower our dependence on foreign energy and improve our economy.  With the economy just beginning to climb out of a recession, high fuel prices threaten to pull us right back down again. MoreEnergyNow allows consumers to engage – as opposed to standing aside and waiting for $5 gas – and create a drumbeat all the way to the White House.

As part of moreenergynow.org, a new digital “imported oil counter” provides consumers and policymakers with the best available data on the growing impact that our reliance on imports continues to have on our economy, on the creation of jobs, and on the price at the pump.  The counter draws on federal data from the Energy Information Administration (EIA), and barely four months into 2011, it already shows that we’ve imported more than 1.09 billion barrels of oil, costing Americans more than $116 billion and counting. The counter may be uploaded to any website and can be seen on several CEA affiliated member pages.

“At a time when families, businesses, and governments at all levels are tightening their belts and trying to find ways to do more with less, it’s shocking to see how much money our country continues to send overseas for its energy,” said Ryan Scott, director of CEA Midwest. “But beyond the billions of dollars we continue to send out of this country, it’s important to note that our federal government has made a conscious decision to limit domestic oil production. What this decision amounts to is fewer jobs for Americans, less revenue for state, local and federal governments, and higher costs at the pump for every single one of us.”

Added Scott: “The idea that our government would promote production in Brazil, but won’t allow hard-working Americans to produce right here at home is difficult to reconcile in any environment – but particularly tough to understand given the current economic conditions facing our country right now. That’s why we’re using this launch to call on our government to allow More Energy Now in America.”

“The country’s growing reliance on imported oil shown by CEA’s Imported Oil Counter is alarming,” said Rich Moskowitz, vice president and regulatory affairs counsel for the American Trucking Associations and chairman of the board for CEA. “At a time of rising diesel and gasoline prices, it’s now clearer than ever that our lack of a balanced energy policy, which should include access to our nation’s own abundant sources of oil and natural gas, is draining our economy and jeopardizing our national security.”

 

Letter: Natural gas can help fuel economy

Long known as a great source of energy for heating our homes and cooking our food, natural gas is increasingly being called upon these days to fuel something entirely different: our nation’s economy.

From the president’s recent statement that the “potential for natural gas is enormous” to the reintroduction of legislation in Congress promoting the use of natural gas vehicles, policymakers are starting to recognize the value in developing a resource that’s clean, abundant, reliable and a powerful engine for economic growth. Not that folks in Louisiana needed a reminder. Thanks in large part to the Haynesville shale, onshore natural gas development from deep shale formations increased by a factor of 20 from 2008 to 2009. This year, the Haynesville shale took over the top spot as the most prolific shale field in the country. The challenge now, for all of us, is to keep it there.

Unfortunately, some folks in Baton Rouge appear to be eyeing new taxes that could have a tremendously negative effect on the Louisiana economy. One plan making its way around town would abolish incentives promoting advanced horizontal drilling technology, which more than anything else has made the Haynesville play a reality. Some believe that eliminating this benefit will bring in new tax revenue, but any gains would be short-lived.

A recent study by Louisiana economist Loren Scott reports that for “every dollar the state gave up via the horizontal well severance tax investment incentive it gained $2.94 in revenues.” In addition, Scott finds exploration companies spent roughly $11.5 billion over the 2008-2009 time frame and generated more than $642 million for the state in revenue. His research also suggests that without this industry, 57,000 more jobs would have been lost in 2009.

Earlier this week, Consumer Energy Alliance hosted a screening of the documentary film “Haynesville,” a movie that explores many of the pertinent issues around the development of natural gas in Louisiana. Lots of folks turned up for the event, and not just because admission happened to be free. Based in Houston and with offices in Washington, D.C., and Chicago, CEA is committed to spreading the word about the need for affordable energy supplies in the United States, particularly in the form of American natural gas. This is especially true in Louisiana, where natural gas is helping put the state — and the country — back on a sustainable economic path.

Andrew Browning, vice president
Consumer Energy Alliance
Chicago

2theadvocate

 

Lessons to be learned

David Holt
Guest Columnist

Anniversaries have long provided us a chance to look back on the past, look ahead to the future and stare straight into the eyes of the challenges that confront us in the present. And so it is this week with the first anniversary of the tragedy onboard the Deepwater Horizon, an incident that claimed the lives of 11 men last April and resulted in the release of 4.9 million barrels of oil over a 91-day span in the Gulf.

A full year now removed from the incident, the question that must be both asked and answered is simple: What have we learned? As president of an organization whose mission it is to bring together and spur thoughtful dialogue among those who produce energy in America and those who consume it, I can tell you we’ve all learned an awful lot.

As a nation, we now have a much better sense of the risk and reward involved in tapping reserves that were previously considered out-of-reach and a much greater appreciation for the men and women whose hard work and years of expertise have made and will continue to make this pursuit possible. As a region, we saw firsthand how decisions announced in Washington, D.C., had the ability to significantly affect the wellbeing of our local work force. And to that point, we were reminded once again that, although science and technology continue to play an important role in the broader debate over energy, it’s politics that often wields the biggest stick of all.

As the administration has reminded us, Gulf oil production was already trending downward before the incident in the Gulf took place, with the federal Energy Information Administration releasing a report days before Macondo projecting production to decline by 110,000 barrels a day in 2011. But after the tragedy, EIA updated that figure to reflect an increased loss of 240,000 barrels a day — a reevaluation influenced in part by the administration’s “permitorium” in the Gulf. Do the math: That’s a 130,000-barrel difference, and one that’s directly attributable to Washington’s lockdown on offshore development. It’s a loss of nearly 48 million barrels over the course of a year — 10 times the amount of oil that spilled in the Gulf.

Now, will 48 million barrels exert much pull on a world oil market that sees about 26 billion barrels bought, sold and consumed each year? By itself, probably not. But viewed as just one more straw — let’s call it a bale of hay — laid upon the camel’s back, a camel that’s already carrying the load of declining production in Mexico, Venezuela and other places, and it’s easy to see why the price of oil is currently comfortably above $100, with the price of gasoline marching inexorably toward $4 a gallon and the price of diesel already well past it.

Of course, independent of what we happen to be paying at the pump right now, you can bet that an extra 48 million barrels of production would lend a hand to both a national and regional economy that right now could sure use the boost. And then there’s the effect it would have on reducing our dependence on foreign oil. No, we’ll never reduce our imports to zero, but decisions being made in Washington are driving U.S. dollars overseas at time when we need them most.

It’s hardly a secret that our nation is facing some of the most difficult economic circumstances we’ve ever seen, with more than 15 million Americans out of work. But here in the Gulf region, our employment numbers, ranging from 8 to 10 percent, are expected to get worse before they get better, thanks in large part to a projected 13 percent reduction in Gulf oil output this year. And nationwide, the federal government is expected to collect $13 billion less this year in taxes, royalties and revenue owing to the situation in the Gulf. I don’t care who you are, where you are or what you do — that’s some serious money on which we’ll be losing out.

Ultimately, only the passage of time will be able to provide the clarity of insight needed to fully assess how the administration’s slowdown in the Gulf has affected our communities. That said, the early returns don’t look good. This week, as we take a moment to remember and honor those who were lost last April, we should also take a moment to consider how far we’ve come over the past year to understand what went wrong that night — and how far we’ve come to ensure it never happens again. A year off the job through no fault of its own, it’s time for the Gulf to get back to work.

David Holt is president of Consumer Energy Alliance, a Houston-based oil-industry advocacy group.

Daily Comet

Flawed science

A new study about the footprint left by natural gas has been receiving a lot of attention for its controversial finding that the greenhouse gas (GHG) emissions from natural gas production are greater than those from coal production.

The study, quite simply, does not support the flashy headlines it has produced. There are many points to dispute in this research conducted by Cornell University professors Robert Howarth and Anthony Ingraffea – from the methodology they used to the assumptions they made at the outset, which do not apply to the Marcellus Formation, the focus on most of the new domestic natural gas production today. But one need not even dive into those more substantive questions to poke major holes in this study.

Let’s start with the source. By Professor Howarth’s and co-author Anthony Ingraffea’s own admission, the data used in their study are “pretty low quality … really lousy.” And then there is this bombshell from the authors themselves: “We did not look as carefully at coal.” The authors, in other words, set out to compare the impact of coal and natural gas production, but then neglected to carefully study the coal part of the equation. How’s that for hard science?

In fact, this is not Professor Howarth’s first attempt to use scientific research to vilify natural gas, nor is it the first time his research has been found to be seriously flawed. He withdrew an earlier study after admitting that he hadn’t known that coal production also produced methane emissions.

These would seem to be serious gaffes, particularly for a supposedly scholarly analysis. But for those inclined to overlook this low-hanging fruit and focus on the meat of the study, there are several more problems. For one, the study makes a sweeping assumption that all “lost and unaccounted-for gas” between what is produced at the wellhead and what makes it to market has escaped into the atmosphere. In reality, not all of this gas is leaked. As it is transported, it becomes compressed, which accounts for at least some of the differences between the volume at the wellhead and that at the final market destination. This issue is explained in more detail in a rebuttal on Energy In Depth, which also notes that Howarth’s findings on leakage do not pertain to gas produced at Marcellus, which need only travel a short distance to its final market. Incredibly, the authors based their calculations for methane leakage on some long-distance transmission lines in Russia.

We could continue listing the major flaws in this study, but there is a larger point to be made here. Natural gas is one of our natural treasures: a rare source of domestic fuel that exists in abundance and has the potential to significantly reduce our decades-long dependence on oil from abroad. While other alternative fuel sources show promise, natural gas shows proven results: Some 12 million vehicles around the world are already running on natural gas.

Yes, we must use scientific research to understand the impact of all of our different fuel sources. But it must be sound research, not the flimsy sort of science on which Professor Howarth’s study is based. We must also recognize the role of science in finding solutions, rather than simply identifying problems. Yes, all energy production has some sort of an impact. But when considering a source of clean-burning fuel that exists in plentiful supply right here at home, we ought to be using science to understand how we can produce with minimal impact and how technology can lead us to even better production practices. Because if we simply use science to discredit all our sources of home-grown fuel, we are doomed to a future that looks like our past: a continued addiction to imported oil.

 

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