Wednesday, July 16, 2008

Energy--Excluded, Not Exhausted

UPDATE: below

No one likes importing America's energy, and nothing concentrates the policy mind quite like 4 bucks a gallon. Well, except for lefties, including Obama, who have no realistic energy policy. Most oppose resuming construction of nuclear plants--despite being the least carbon-emitting of all cost-effective power sources. And Congressional Dems scrubbed a scheduled mid-July vote over fears Republicans would push for expanded off-shore and shale exploration--which Democrats historically have opposed. Why?
  1. Some worry about the environment. A few Judges want to save songbirds. Even John McCain, who favors off-shore drilling, would preserve the Arctic National Wildlife Refuge "undisturbed." Similarly, others against opening ANWR tout the need to protect its supposedly pristine ecology. But drilling opponents plainly never read Jonah Goldberg's iconic August 6, 2001, National Review cover story--some photos here--forever debunking any Eden-like beauty. Besides, Jonah Goldberg recently emphasized the small scope of the proposal:
    ANWR is roughly the size of South Carolina, and it is spectacular. However, the area where, according to Department of Interior estimates, some 5.7 billion to 16 billion barrels of recoverable oil reside is much smaller and not necessarily as awe-inspiring. It would amount to the size of Dulles airport.

    Question for McCain: Has South Carolina been ruined because it has an airport?
    Answer: only if you're "bitter."

  2. Others argue about timing. These opponents of expanded domestic energy exploration insist increased domestic production--particularly from ANWR--would take too long to reduce gas prices. This view (which not all lefties share) is economically illiterate--energy is sold on a global futures market, as economist Larry Kudlow explained on National Review:
    should Congress overturn its offshore-drilling moratorium, [energy] speculators are gonna start selling crude-oil futures contracts and price declines will filter backwards from the longer-term contracts to the cash market. In other words, what can be bought will be sold. If drilling expectations change on the hope that future oil supplies will rise, prices will adjust lower and it will happen fast.
    (Progressives motivated by oil company profits to oppose enhanced domestic exploration--a group encompassing Dem Congressional leaders--are equally clueless, economically-speaking.)

  3. Finally, there's the "drop in the bucket" objection. Such lefties--sometimes backed by the Bush Department of Energy!--say the amount of additional energy obtainable from ANWR and other domestic sources is too minute to matter. Setting aside the fact that almost any increase could help (see economically illiterate, above), is it true that recoverable domestic energy is insignificant compared with known reserves? Given the scope of prohibited exploration, no. According to the non-profit Institute for Energy Research, blocked reserves of oil, coal and natural gas are enormous:

    source: Institute for Energy Research

    Indeed, as AVI has noted, and I've previously observed, high oil prices make shale and tar sands particularly attractive:

    source: Institute for Energy Research

    So they're right that the "drop" isn't a bucket--more like billions of barrels.
Conclusion: The notion of energy independence is a mirage. But that doesn't make it sensible--where markets make it cost-effective--to bar domestic exploration that could increase energy supply. It's time to get serious about North American shale, sands as well as coastal and ANWR oil and natural gas--so drill.


Jay Leno on the May 1st "Tonight Show" (video here):
Democrats say drilling in ANWR wouldn’t produce any oil for 10 years — the same point they’ve been making for more than 10 years now.

Deroy Murdock in National Review:
Currently mired in red tape, Chevron’s Destin Dome field off Florida could produce within four years. Southern California deposits could yield within five to ten years. Besides, as Confucius said: “The best time to plant a tree is 10 years ago. The second best time is now.”
(via Powerline, Wolf Howling, Instapundit, Planet Gore)

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