Tag: oil and natural gas

The end of the oil boom?

The Deepwater Horizon accident in the Gulf of Mexico drew limited headlines upon its occurrence, with the biggest news at the time being the 11 workers missing after the rig’s explosion and fire. It wasn’t until the discovery that crude oil was leaking into the Gulf because of a faulty shutoff valve that the story moved to front-page headline status.

At a rate of perhaps 5,000 barrels per day, the spill – more properly described as a gusher akin to the proverbial Texas oil strike because of the pressure bearing from beneath the Gulf floor – may turn out to rival the amount of oil lost in the 1989 Exxon Valdez shipping accident. Obviously the immediate environmental damage from the oil spill will be severe and economic damage to the local seafood industry catastrophic; fortunately, we also know from the Exxon Valdez accident that eventually the region will be able to recover. Since crude extracted from the Gulf is relatively light in weight, the oil isn’t the thick black gunk most people think of when they think of an oil spill; rather, the result is a silvery sheen on the surface which may be easier to disperse through chemical means.

Long-term impact on the oil industry may be more disastrous. Needless to say, environmentally conscious Democrats called on Obama to drop his proposed offshore exploration program in the wake of the accident, and White House adviser David Axelrod agreed, saying, “no additional drilling has been authorized and none will until we find out what has happened here.” Axelrod’s response to the accident, ironically occurring on the eve of Earth Day, suggests the open-ended nature of the moratorium may lead to more regulatory hurdles for oil operations in the Gulf.

For decades, exploration in the Gulf of Mexico had progressed without incident, and the more than 3,500 platforms already producing in our portion of the Gulf routinely endured shutdowns brought on by approaching hurricanes and regular maintenance. In these cases the shutoff valves did their job, making the Deepwater Horizon incident an outlier. Nor can the prospect of sabotage or terrorism be ruled out given the enticing target presented by what was essentially a seagoing vessel tenuously rooted to a wellhead 5,000 feet below the surface. The Deepwater Horizon was one of only about two dozen rigs situated in a water depth more than 1,000 meters – the technology of deepwater drilling is still maturing.

Yet billions of barrels of oil lie entombed underneath the Gulf of Mexico. Undoubtedly there is an argument underscored by the Deepwater Horizon tragedy which says we need to back down, but when you compare the safety record of Gulf drilling to that of shipping 9 million barrels of oil per day for our use over many of those same waters and the prospect for disaster there, the risk is worthwhile.

As we stand right now, there is no perfectly safe or perfectly reliable form of energy out there and the Deepwater Horizon accident points out the possible (but historically unlikely) downside of oil dependence. But coal also has drawbacks and safety concerns as recent mining accidents remind us, while the pesky problem of waste and threat from radiation dogs proponents of nuclear power. Renewable energy is great in concept, but the reliability of solar and wind energy obviously depends on optimum weather conditions.

Accidents will happen, but there’s no reason to stop oil exploration after this tragedy. The record of safety is no longer unblemished but still exemplary, and on balance the benefits still outweigh the risks. Let’s get oil workers back to work.

Michael Swartz, an architect and writer who lives in rural Maryland, is a Liberty Features Syndicated writer. This op-ed cleared the LFS wire on May 4th.

Note: after a preliminary investigation, it sounds like the accident was a combination of faulty equipment and bad luck. Methane’s not something you want to mess with.

Offshore drilling unlikely in Maryland waters

Despite the chants of “drill, baby, drill” from thousands of Marylanders upset at surging gasoline prices, the prospects of Maryland becoming an offshore oil producer like states along the western Gulf coast is remote.

While the new plan wouldn’t allow for exploration until at least the latter half of this decade, Maryland’s top statewide elected officials have made it clear they don’t support the prospect of oil exploration off our Atlantic coast.

(Continued on my Examiner.com page…)

The coalition is fading fast

It hasn’t been well-publicized but over the last week three corporations withdrew their membership from the U.S. Climate Action Partnership – Conoco, BP America, and Caterpillar cut ties with the group in the wake of recent questions about the accuracy of the data used to support manmade global warming.

As Myron Ebell from the Competitive Enterprise Institute noted:

In dropping out of the U. S. Climate Action Partnership, BP America, Conoco Phillips, and Caterpillar are recognizing that cap-and-trade legislation is dead in the U. S. Congress and that global warming alarmism is collapsing rapidly.  We hope that other major corporations will soon see the light and drop their support for cap-and-trade and other energy-rationing legislation. 

These announcements are most welcome, but they do not mean that we can relax our efforts to defeat and roll back energy-rationing legislation and regulations.  Many policies and proposals that would raise energy prices through the roof for American consumers and destroy millions of jobs in energy-intensive industries still pose a huge threat.  These include the EPA’s decision to regulate greenhouse gas emissions using the Clean Air Act, environmental pressure group efforts to use the Endangered Species Act to stop energy production and new power plants, the higher fuel economy standards for new passenger vehicles enacted in 2007, presidential executive orders, and bills in Congress to require more renewable electricity, higher energy efficiency standards for buildings, and low carbon transportation fuel standards.

Worthy of note that the three dropouts are two energy companies and a heavy equipment manufacturer, companies which would likely be in favor of alternative energy if they felt it were a profitable way to go.

Frankly, I was a little surprised to see my friend Jane Van Ryan downplay the withdrawal of two energy companies given her closeness to the situation. Then again, she points out that the unraveling of the climate change hoax is happening on many levels – everything from record cold and snowfall across the country to “hiding the decline” to the legislative failures both she and Ebell point out.

Yet big corporations are keen about shifting sides in a debate when they sense they’re no longer on the winning side. Most Americans don’t mind the occasional recycling program and taking other steps to protect the environment – that is until they feel compliance switches from voluntary to mandatory, as it would for cap and tax and other government mandates. As you’ll see Sunday (can you say foreshadowing?) the Audi “green police” commercial hit close to home because it’s just believable enough to be discomforting.

In the meantime, this may be a good opportunity to reward these companies for their farsightedness and belief in capitalism. Certainly they’re still going to have their lobbyists bending the ears of federal and state legislators, but at least in this way they have determined that government won’t be the solution to the problem.