Because of the snow, it’s sort of a slow news day today. So I was looking for something interesting to comment on and found out that the practice of fracking can now retire, as it’s reached the ripe old age of 65. From Energy Tomorrow:
We celebrate the first commercial use of hydraulic fracturing 65 years ago on March 17, 1949, conducted by Halliburton in Stephens County, Okla., and Archer County, Texas. But the roots of the fracking story stretch back to the 1860s. In a 2010 article for the Society of Petroleum Engineers’ Journal of Petroleum Technology (JPT), NSI Technologies’ Carl Montgomery and Michael Smith write that energy pioneers experimented with oil well “shooting” that would “rubblize” oil-bearing rock to increase flows. Various methodologies were used to fracture rock formations over the years until Stanolind Oil, a division of Standard Oil of Indiana, conducted the first experimental “hydrafrac” in 1947 in Kansas. It involved pumping fluid carrying “propping agents” at high pressure into a well to create fractures that could be held open to free oil and natural gas in the rock.
People have freaked out over this technology over the last half-decade since the oil and natural gas industry embraced it to bring new life to old fields as well as other places where energy exploration was previously deemed economically unworthy due to quantities thought not to be worth the trouble. Yet the root technology was decades old; the confluence of evolving technique with the increase in oil prices to a point where fracking could be cost-effective gave the impetus to the industry. Truthfully, when oil was $15 a barrel and being pumped like crazy in the Middle East a couple decades ago, there wasn’t much demand for domestic supplies.
On the other hand, natural gas that ran about $4 per thousand cubic feet in 1981 only costs about $9 per thousand cubic feet now (although seasonal fluctuations are more severe.) Since that’s not far off the increased cost of living from then to now, this technology has enabled the natural gas market to hold serve despite increased demand from electricity generation, which receives a much better rate than the residential figures I cited. Granted, the recent surge began around the time when natural gas for residential use hit its all-time peak of $20.77 per thousand cubic feet in the summer of 2008, but opening up export markets can make additional fields profitable while stabilizing prices.
Now there is an element of truth to the argument naysayers in the manufacturing and chemical industries make about the potential that exporting LNG to other countries would increase prices here, although I doubt they would triple as claimed. But let’s explore once again the alternative scenario, one which I alluded to a couple paragraphs back.
Oil companies were laying people off and shutting down wells when prices were $15 to $20 a barrel because there was no way to run many of the old wells profitably. Some seem to forget that entrepreneurs go into business to make a profit, so they can make a living. Just like Staples is lopping off a couple hundred of its lagging retail performers, these companies idled wells which were losing money. In one respect it was great because gasoline went back under a dollar per gallon (remember that?) but that was a short-lived phenomenon which ended about the time of the first Gulf War – meanwhile, it took several more years for the oil industry to recover. Like it or not, that’s a vital cog of the American economy just like automakers and other manufacturers, who can use the incentive of energy which is reliable and still relatively inexpensive to create jobs.
So the ideal this time would be to maintain a fairly steady and predictable price while expanding the supply and maintaining those wells which are in operation so they stay economically viable. But if it weren’t for fracking, we would be in the situation of having to import a greater and greater share of our energy, a policy which would quickly drive up prices and perhaps exacerbate our national economic slowdown to a recessionary point once again. A modest increase in energy prices would be a small price to pay for the creation of thousands of jobs with private-sector investment – and who knows, maybe the predicted price increase won’t come. But I’ll bet the jobs would.
As you all know I have an interest in the energy field and a disdain for the unproven – so I’m no big fan of technology that’s not reliable 24/7/365. While renewable energy has its uses in limited applications, such as the solar panels on one’s roof or the windmill which augments the rural homestead, all of these sources need a backup for when we endure a week’s worth of cloudy days or still weather. So I have a bias toward the tried-and-true energy sources of coal, oil, and natural gas.
Having said that, it amuses me when I see the potential for infighting among the environmentalist crowd as we could have a battle royale between the animal rights crowd and the renewable energy set – the reason: a study published in the journal BioScience and gleefully critiqued by Steven Hayward at Powerline estimates that 600,000 or more bats are killed each year by wind turbines – a much higher toll than previously thought. And as Michael Todd, writing at Pacific Standard, explains, it’s not for the reason you might think:
Given that wind turbines are basically a collection of whirring blades, you might assume that the bats found dead have been sliced and diced. You might also wonder how an animal that uses radar to find a single mosquito in the dark could fail to sense a monstrous wind turbine. The University of Calgary’s Erin Baerwald explained this to Discovery News in 2008: “When people were first starting to talk about the issue, it was ‘bats running into the turbine blades.’ We always said, ‘No, bats don’t run into things.’ Bats can detect and avoid all kinds of structures,” and are even better at detecting stuff that’s moving. No, they’re exploding. As I learned last year, “Baerwald and her colleagues discovered that bats’ ‘large, pliable lungs’ blow up from change in air pressure created by moving blades. Up the 90 percent of the dead bats they examined showed the internal bleeding consistent with their argument. Birds, by the way, have different kinds of lungs so their deaths are from the more predictable blunt-force trauma.”
Of course, bats are very creepy creatures and tend to be a nuisance if they get into your house. But they have one tremendously useful purpose: keeping the mosquito population at bay. A commentator on Hayward’s post writes about watching bats fly around at dusk and I can vouch for the fact that it is interesting to watch them maneuver around in the fading light of a summer evening, gorging themselves on those pesky bugs.
And the problem seems to be worst in the Appalachian part of the country, which includes the western part of Maryland. While it’s not prime territory for efficient windmills, that area is probably the most desirable in the state for the purpose.
Yet there is another energy source where the two westernmost Maryland counties are prime territory, and that’s the Marcellus Shale formation where natural gas is plentiful deep underground – and by deep I mean hundreds and hundreds of feet below the aquifers. I point this out because portions of New York state endure some of the same effects as their Marcellus cousins in Maryland; both are primarily rural areas which can use an economic shot in the arm. As is pointed out in a Wall Street Journal editorial from last week by Fred Siegel, those areas of southern New York along the Pennsylvania border suffer from the same faraway NIMBYism that the western panhandle of Maryland has to deal with – those who live nowhere near the area think they know best.
But unlike Maryland’s Martin O’Malley, whose sole response has been to study the subject to death, his potential Democratic presidential rival from New York, Governor Andrew Cuomo, at least was willing to allow some limited fracking in that specific region – that is, until he was told by the environmental extremists, “we’ll cream you if you open New York state to fracking.” While neither the western edge of Maryland nor that five-county area of southern New York along the Pennsylvania border (from Steuben County on the west to Broome County on the east and including adjacent Chenango County) has the worst unemployment numbers in their respective states of Maryland or New York, the fact is they can do better.
And it’s not just the energy companies booming – this story by Barbara Miller in southwest Pennsylvania’s Observer-Reporter newspaper (h/t Energy Tomorrow) points out the financial gains in just two of the state’s counties. Quoted in the story was Washington County Commission Chairman Larry Maggi:
I don’t want to use the word envious, but (other counties are) struggling and they do not have this resource to help them balance their budgets.
While amounts from $6 million to $18 million are drops in the bucket for a state budget, they can potentially be huge for some of the rural counties affected. Energy companies are accustomed to paying a fair royalty fee to local governments, knowing the market will support that toll while allowing a reasonable profit.
So, as you’ll see in the next week or so when my candidate dossier on energy is complete, there’s a big difference in stance between Maryland Democrats and Republicans on the fracking issue. Apparently most Democrats are happy with blowing up bats and chopping up birds, but Republicans want to create jobs.
I ran across an interesting piece of polling thanks to the Energy Tomorrow blog. Their American Petroleum Institute parent group commissioned a Harris Poll of likely voters in four states – Florida, South Carolina, North Carolina, and Virginia – and asked them a series of questions to gauge their support for offshore drilling. As I would expect, the topline numbers showing support for the practice are quite solid, ranging from 64% in Florida to 77% in South Carolina. (Virginia weighed in at 67% and North Carolina at 65%, so it worked out to roughly 2/3 overall.)
But before you assume this is going to be another shill for offshore drilling (which I indeed support) I wanted to point out a glaring flaw in the poll methodology. For example, read through the Virginia polling data and see if you can figure out what’s missing. I’ll give you a second.
The first piece of the puzzle I would have liked to see would be a breakdown of support in coastal areas vs. inland. Using Virginia as an example, it would be nice to know how the question did in the 757 area code, which covers the Norfolk area and the Eastern Shore of Virginia. I would bet that support in that particular area was closer to 50-50, if not slightly negative.
But the key omission was the question: “Would you support offshore drilling off the coastline of your state?” The API’s point is that much of our coastline is off-limits to drilling because of shortsighted policies which ignore the overall safety record of the industry as well as the “peak oil” hysteria helped along by those same environmentalists who wouldn’t mind putting aquatic birds at risk with offshore wind turbines. But their point would have been buttressed even better if they had a clear majority of Virginians (or any other affected state) indicate that drilling off their coastline was an acceptable practice.
While these particular states were probably selected due to the length of their coastline, I wonder how Maryland and Delaware would feel with the same question posed to them. Granted, between the two there’s just 59 miles of Atlantic coastline but they indeed have oceanfront within both states so they could be hosting oil exploration and extraction in their waters someday. My guess is that they would still fall in the 60 percent range as far as drilling support, but only run 30-35% for drilling off their coastline. (A large part of that might be because so much of it is state- or federally-controlled parkland.)
Certainly it’s reassuring that offshore drilling still enjoys support after all its bad press over the last half-decade, but I’m not convinced the impetus is there yet for much motion on the issue. Fortunately (or unfortunately), the question is pretty much moot until 2017 at the earliest so we have time to create the necessary shift in public perception.
Every so often I point out how other states are taking advantage of avenues our fair state of Maryland cannot – or will not – compete in. One such area is energy exploration, which has benefited states like Texas and Alaska for decades, and more recently turned North Dakota from a state which was stagnant in population and lacking opportunity to America’s fastest-growing state, with a “new normal” of energy-led growth. Indeed, taxable sales increased 28.7% from 2011 to 2012, according to North Dakota Tax Commissioner Cory Fong.
Obviously in the several states results may vary, and Maryland doesn’t have that same petroleum-rich land mass that North Dakota does. But in the western end of our state we do have the potential for some nice job creation if we allow the tapping of the natural gas-rich Marcellus Shale formation like Pennsylvania has done for several years. And who knows what we could find under Maryland’s offshore waters? It’s doubtful we’ll ever be confused with a state like Louisiana, where dozens of oil platforms lurk just offshore, but the potential is there for a healthy bump in economic activity should we choose to take advantage of this.
One thing which seems to be lost in the question about whether oil and natural gas exploration would be good for the state is the sort of jobs created. Say what you will about the energy industry, but they tend to pay better than flipping burgers at McDonald’s. Sure, it’s likely to be demanding physical work for those who are semi-skilled, but they would be making a living sufficient to support a family – reminiscent of a bygone era where dad went to work 40 hours a week at the auto plant “makin’ Thunderbirds” (as the old Bob Seger song went) and mom could afford to stay home with the kids. And it also brings up the point about not necessarily needing a college degree (and the tens of thousands of dollars of associated debt) to make a good living. Then again, those who have the intelligence and drive to be engineers or even technicians and complete the college training required would find a very welcoming field. Our neighbors to the west in West Virginia have heeded this call.
Back in the 1970s, at the height of the oil crisis, those of us in rural areas had a saying that we should trade the OPEC nations a bushel for a barrel – they had plenty of oil but they needed food to feed themselves – and we had plenty of it. But in America we could develop the potential to sell other nations both the bushel AND the barrel simply by getting out of the way of energy production and dropping this silly notion about producing ethanol from corn.
Why not get the best of both worlds? All we need is some truly forward-thinking leadership, the kind which realizes we have the potential under our very feet to be dependent on no one outside of North America for our energy needs and future growth therein.
It’s interesting that last night I pointed out in passing North Dakota’s success in bringing their per-capita income to the cusp of the top five in the nation when even more encouraging news recently came out for them. This update is from the Energy Tomorrow blog in a post by Mark Green:
The U.S. Geological Survey has new estimates for oil and natural gas in the Williston Basin shale area that simply blows the doors off previous estimates:
- 3.65 billion barrels of undiscovered, technically recoverable oil for the Bakken Formation.
- 3.73 billion barrels for the Three Forks Formation.
- The total, 7.38 billion barrels, is a two-fold increase over USGS’ 2008 estimate, which included only the Bakken Formation because Three Forks wasn’t thought to be productive.
If you’re wondering where the Williston Basin is, perhaps this USGS map will help. Note that this formation is different than the Marcellus Shale formation which encompasses the western end of Maryland. But consider that North Dakota has the lowest unemployment rate in the country, and while it’s not necessarily glamorous tasks requiring a master’s degree or specialized training, there is a lot of work available out on the plains.
But the principle outlined later in the piece by Green remains true regardless of the conditions:
The dramatic increases in these oil and natural gas estimates are a credit to industry initiative and the application of ideas and technology – in non-federal areas where oil and natural gas development is supported and encouraged. These reserves underscore the game-changing nature of unconventional oil and natural gas – again, thanks to hydraulic fracturing – that could support the creation of 3.5 million jobs and more than $5.1 trillion in industry cumulative capital spending by 2035, according to an IHS Global study.
Obviously the small portion of our state which happens to lie within the Marcellus Shale region would only see a fraction of that benefit. But what about offshore oil? We don’t know because no one is being allowed to do the necessary leg work to drill and find out. There could be an energy windfall off Ocean City which has nothing to do with thirty-story high wind turbines but we can’t say. Indeed, we could have no viable oil deposits there, either.
But factor in that just five years ago no one thought the Three Forks Formation was commercially viable for oil, and now there’s the potential for 3.7 billion barrels. (Granted, our daily consumption is about 20 million barrels of oil per day so by itself the field isn’t huge, about six months’ worth. Yet you can add that to all our other potential, not to mention the near-certainty that technology can eventually enhance our findings.)
Because I favor the expansion of an energy type which has been proven to be efficient and relatively cheap in comparison to other modes, some have called me a shill for the oil industry. Sorry, I don’t work for them – although if they can use a writer, I certainly would entertain the offer. I just happen to know that an economy which is growing the right way needs to expand their usage of energy so mankind has to expend less and allows us more time and effort to devote to improving our lot in life.
As I said yesterday, the part of the state which tends to vote against its own best interests is the part which, in this case, is sending useful idiots who believe the garbage about the “dangers” of fracking to Annapolis. No, the process is not risk-free, but no endeavor worth doing is. We’ve placed ourselves with New York as two states falling far behind the curve on energy exploration, but 2014 provides us the chance to correct that mistake.
Since I took nearly 100 pictures and 36 made the final cut, I decided to make this a two-part post.
Recently having done a stint at the Turning the Tides Conference, I thought I had a little bit of an idea in what to expect from CPAC. But the entirety of the Gaylord Conference Center and the number of celebrities speaking and milling around tells me that I missed a lot when I missed the first two days of the gathering. Yet the one day I managed to be here was well worth my time in learning from and meeting those who move and shake the conservative world.
Walking into the Potomac ballroom I was blown away by the expanse of the venue. Sure, we have some decently-sized conference rooms for our 300-person gatherings for the Maryland Republican Party, but this room could hold a sporting event. If anything, the stage made the speaker look small.
The first speaker I heard upon my arrival and the recitation of the Pledge of Allegiance and invocation was TEA Party pioneer Jenny Beth Martin, who repeated the case I’ve been pleading since the most recent incarnation of the pro-liberty movement was born: conservatives are for limited government, fiscal responsibility, and a thriving free market. Instead, Martin said, they are “mocked, marginalized, and maligned.”
She also added that we’re headed to bankruptcy, with an Affordable Care Act which is “unaffordable, callous, and cruel.”
“The reality today is grim and heartbreaking,” Martin added.
She concluded by asserting, in a rising voice, that liberty will endure – if we fight for freedom. “Our Constitution is worth fighting for, because freedom is worth fighting for.”
Rep. Steve King of Iowa followed Jenny Beth to the podium and made the case that “Obamacare has got to go…we can’t let up.” It erodes our vitality and is an “unconstitutional taking,” according to King. He also criticized the immigration initiatives because, as King claimed, 2 out of 3 illegal aliens are Democrats “and the Democrats know this.”
King called on us to “restore the pillars of American exceptionalism…we’ve got a country to rebuild together.”
I should point out that I had pictures of these two speakers and they didn’t make the cut. But this guy made the cut.
Wisconsin is a state which has a leader, said emcee Charlie Kirk, founder of Turning Point USA, and Governor Scott Walker detailed a number of ways he’s indeed led.
Harkening back to recent initiatives, Walker noted welfare reform and tax reform originated in the states. And just as the states created the federal government, the 30 states with GOP governors – most of which also have Republican-led legislatures – can improvise with good, conservative ideas. But Walker made the point that “to be successful, we have to be optimistic, relevant, and courageous.” It’s obviously working in Wisconsin, where 93 percent of the state said it was heading in the right direction. “We’re the ones who care about fixing things,” he added.
Walker was ready with a number of examples of poor policy, like the first-year Milwaukee teacher who was selected as their teacher of the year but furloughed because she was at the bottom of the seniority chain. His union reforms eliminated that problem. The overall idea, continued Walker, was to replace the narrative that a successful government was one which created dependents with one which made the case that government works when it assists people to wean themselves off dependence by making it easier to get a job.
“In America, we celebrate the Fourth of July, not April 15,” shouted Walker. “We believe in the people, not the government!”
And then came Newt – a guy who only needs one name to convey who I’m speaking about.
Gingrich addressed the concept of government needing to be pioneers of the future, and get out of being prisoners of the past. As a movement our contrast with President Obama “couldn’t be more vivid.”
But he saved withering criticism for the “Republican establishment class,” which “couldn’t be more wrong.” Holding up a candle and light bulb, Newt chided Washington as “being prisoners of the past…they’re all trapped in the age of candles.” Both parties in Washington are blind to the future, though.
Interestingly enough, Newt promoted a book by a liberal author, the former mayor of San Francisco and now lieutenant governor of California, Gavin Newsom. But Citizenville was a book “every conservative should read” because it promoted a more active citizenry. Gingrich used the analogy of the Facebook game Farmville, with the idea being earning rewards for public-spirited achievement rather than planting virtual crops.
Newt also took a swipe at the establishment wing of the party, saying that since 1976 “the dominant wing (of the GOP) has learned nothing.” Nor should we be strictly the anti-Obama movement, said Newt.
The powerful morning lineup of featured speakers concluded with Minnesota Congresswoman Michele Bachmann, the 2012 Presidential hopeful whose campaign flamed out after a great summer of 2011.
She explained about the TEA Party movement “we love people in this country…we want everyone to succeed in this country.” As key parts of that success, Michele believed there were a lot of goals we could accomplish “if we put our minds to it” such as cutting the price of gasoline to $2 a gallon, preserving our Second Amendment rights “for your sister and your mother,” and most ambitiously finding a cure for Alzheimer’s Disease in the next decade. The key wasn’t big government, she argued, but “big innovation.”
Bachamnn also chided the inefficiencies of government, pointing out that for every $10 spent on food stamps only $3 goes to recipients while the other $7 goes to bureaucrats. She also dubbed the Obama presidency as “a life of excess.”
In the hardest-hitting portion of her remarks, Michele savaged Barack Obama for the “shameful incident” of Benghazi. “This is a story of not caring,” Bachmann said. Because (Tyrone Woods and Glen Doherty, the two ex-Navy SEALs killed at Benghazi) cared, they defied orders and they chose to go to the aid of their brothers…they fought for our country.”
As the attack raged on, “they continued to radio their government begging for help,” charged Bachmann, “and that help never came.” This despite the fact President Obama knew of the attack within its first hour, she continued.
“A war was raging in Benghazi for hours, and all we know is that our President went AWOL,” she continued to a chorus of boos and catcalls for Obama. “No one knows to this day where the President was.”
Of all the Saturday speeches I heard, Bachmann’s was perhaps the most critical of Barack Obama.
After she finished, I decided to skip the next panel and head out to explore a little. I hadn’t really had the chance to walk around as I arrived shortly before the proceedings began. It was a crowded lobby to be sure.
This space also featured the famous “Radio Row” I’d only heard about, although on a Saturday morning it wasn’t as busy.
The TEA Party Patriots were busy doing a
radio show, though. (Actually, it may have been just before or just after this video was done. The blond gentleman in the background of my picture is Jim Hoft of Gateway Pundit.)
There were a few television broadcasts in various stages of production, such as those of Hot Air.
Also working on content was the TEA Party News Network, who thankfully sponsored the internet access (more on that in part 2.)
Further down Radio Row, another start-up operation was making itself known to the broadcasting world.
Later in the day, it was announced that One America News Network would make its debut July 4 of this year. “We will be the platform for the conservative message,” said OANN’s Graham Ledger. He cautioned, though, that cable systems “will resist putting on a conservative news network.”
Once I made my way down the hall and down a level, I was at the entrance of the exhibit hall. I didn’t count them, but there were probably over 100 groups exhibiting their wares. By the time I was through, the swag bag I received at the entrance was very full (I took the picture when I got home.)
The exhibit hall was fairly expansive as well.
Here was a group I think needs further investigation. Unfortunately, there was no one there to explain the concept to me. From what I gather, it’s a database of conservative companies to support.
Another group I’d love to have seen a representative of was this one. Maybe their volunteer (or intern) had an encounter with some union thugs.
I got to talk with this group, though. They represent an outfit I’ve referenced a lot over the years.
A newer but very nice organization has been referenced on this site since its formation. Unfortunately, in missing Friday I missed a chance to talk with its founder.
Someone else who might be on the 2016 ballot had some unofficial help. These were placed on a side table, but not many were wearing them that I saw.
There was also an area in the exhibit hall for book signings. When I was down there, Newt and Callista Gingrich were signing their tomes with Ellis the Elephant looking on.
Some people simply took the opportunity to relax and take a quick break in the CPAC Lounge. They could watch the action upstairs on the monitors.
Just like them, I’m going to rhetorically relax and take a break, since this seems like a nice dividing point. Part 2 will be up tomorrow morning.
I found this to be interesting; unfortunately the omission is not surprising. Last week on the Energy Tomorrow blog, a map showing all the areas placed off-limits to oil and natural gas exploration was posted; meanwhile, as the piece by Mark Green points out, the governors of Virginia, North Carolina, and South Carolina called on the federal government to allow drilling off their coastlines. Needless to say, I didn’t see Martin O’Malley’s name on that letter because he’d rather waste time and money tilting at windmills, and “can’t imagine” anyone would want to drill for oil off the coast of Virginia. Better think a little harder there, governor.
The naysayers also would tell you there’s only a limited supply of oil off our coast, anyway. But who really knows? The estimates of Outer Continental Shelf energy resources are over 30 years old, created at a time when people believed in “peak oil” and that energy resources in this part of the country were pretty much played out. Hundreds of massive deepwater oil finds and millions of cubic feet of natural gas unlocked through fracking later, we know better.
Yet our governor swears up and down the market is there for offshore wind, and insists it would cost us no more than a couple bucks a month. But why can’t we have both?
It seems to me there are vast swaths of ocean area being debated about here, hundreds of square miles. How much space (and height) does a deepwater drilling platform really take up? Wouldn’t it be possible for the oil platforms and the windmills to coexist? I honestly don’t see how one would affect the other, with the possible exception of being careful to drill away from the underground infrastructure needed to transmit the electricity produced to shore. Aside from that, there’s a lot of ocean out there. Certainly the purists who like to look out over the ocean and gaze at the stars at night would object to the lights of oil platforms within their line of sight, but the same can be said for wind turbine towers (they have to be lit as well, so planes and boats don’t run into them.)
You know where I stand. But if we can have both and the market will support them, I say go for it. Bet I know which would be built first.
Yesterday it was announced that the Keystone XL project, an oil pipeline which would have connected the oil sands of Alberta to refineries that could handle the product here in the United States, was shelved again by President Obama. This despite his quest to find “shovel-ready” projects and address the nation’s high unemployment rate.
Reactions? Well, pretty much what I expected. Needless to say, Mark Green at Energy Tomorrow was critical of the decision, stating President Obama wasn’t after jobs but “settled on a different calculus – re-election politics.” The American Petroleum Institute writer also pointed out the Keystone project had been under review for three years, plenty of time to gauge environmental impact. This is particularly true when one considers the Keystone XL pipeline could have run close by the existing Keystone pipeline already in use.