Gail,

A strong reason not to go for this oil is, as you point out, it is difficult to get. This means that it will perpetuate high oil prices, just like tarsands. Currently, oil is easy to get and the high price just means that there is a greater wealth transfer going on. There is not all that much oil on the market that is actually expensive to produce yet. Oil that is hard to get is an actual drain on the world economy and thus should be avoided.

Conservation to the level where oil prices fall is the best possible response to declining oil supplies because it discourages attempts to bring these harmful, expensive-to-produce sources on line.

http://mdsolar.blogspot.com/2008/06/oil-is-too-expensive.html

Chris

Good article Gail! I agree on every point.

One thing that you might emphasize is the time lag involved in bringing it online. I think this is poorly understood. The earlier comment regarding conservation is a fine case in point. Many people seem to think that the OCS and ANWR oil will allow a continuation of BAU. The difficulty is that in 7-10 years, BAU will already have been wiped out, and the oil that is produced by ANWR/OCS will be used in mad max prevention not SUV continuation.

I think we should at least start oil exploration in these heretofore prohibited domestic areas. If the discovered reserves turn out to be at least as large as expected, so much the better. If not, then we at least have a better understanding of how bad our situation really is.

The way oil is currently traded on the open market there is no guarantee that all of this 'new' oil will be going to US consumers, though it will have the general benefit of providing a bit more of a cushion to the global oil markets.

However, as I see it, the biggest negative impact of opening up these domestic areas is the public perception (greatly encouraged by Big Oil and many politicians) that this is going to 'fix' our current energy problem. Judging from the many letters to the editor of our local newspaper, there is a widespread notion out there that if we just 'drill here and drill now', prices will soon get back to what they were in the good ol' days and that everything is going to be OK. While such is delusional thinking, it is also comforting, and therein lies the danger.

everywhere i heard most drilling rigs are booked solid for five years or more

http://www.asiantribune.com/?q=node/11941
'The US is said to have a shortage of ships for offshore drilling. It is not unusual to hear drilling ships being booked five years in advance.'

http://www.nwanews.com/adg/Business/229416/
'the world’s existing drill-ships are booked solid for the next five years'

http://www.emediaworld.com/press_release/release_detail.php?id=86215
'Transocean, the world's largest drilling company, is building nine new deepwater rigs, and eight of them are already under contracts that run from four to seven years'

looks like if you want to drill anything you must build your own drilling fleet

There is really only one argument for drilling for the oil in question. All other "reasons" are simply rationalizations. That argument is that the lifestyle and economic system built upon oil is worth stretching out a few more years.

Being PO aware and wanting to drill for the last little bits is akin to being an alcoholic who has determined to quit drinking, once all the bottles in the house are empty.

Gail,
Thanks for the transcript.
If you look at the EIA production numbers you see the real reason(IMHO) for the big push in offshore oil--declining offshore production!
Nobody will want to invest in a declining resource(3% a year) so they HAVE to paint the glass half full!

Interesting that they said we have to drill because the data is too old (aka unfavorable).

In 2002 production for US offshore(1/3 of US production) was ~2 mbpd, today it is ~1.7 mbpd, at this rate in 20 years we'd be around 1 mbpd.

It seems to me that there is much more desperation than optimism here. A Tupi 'discovery'--speculative
at best---would keep the game going and the money flowing.

gail,
your arguments are well reasoned, but i couldn't disagree with you more. i believe that you are looking at the value of this indigenous oil as it's present value as a transportation source. in 20-40 years, oil and gas may very well have "higher " uses as the feedstock for food, plastics, chemical and pharmaceutical necessities. i'd say it makes more sense to use OPO (other peoples oil)now. that small dab of oil in ANWR and off shore will be invaluble in the future.

I have never been in the oil business but I grew up in the Texas Panhandle and developed an early familiarity and friendships with many participants. I became interested in and a student of the concept of peak oil during the 50's. During the 90's the late L.F. Buz Ivanhoe was planning the Hubbert Center Newsletter, to be sent by mail to selected bureaucrats and some of his oily friends. Buz did not own a computer. I gave him internet lessons at the local library and at our homes but he was set in his ways and I eventually became his internet liaison by default. I gave him items from the USENET (sci.geo.petroleum etc) and the Jay Hanson inspired internet groups. Jay was the first to publish the newsletter on the internet. Buz and I had both been around for the development and depletion of the Southern California offshore fields, the Santa Barbara spill and the noise from the Santa Barbara organization GOO (Get Oil Out). If memory serves Buz thought that there might be another billion barrels or so of recoverable oil off Santa Barbara but that it was of poor quality and of relatively little interest to oil companies, at least at that time. There was also a possible small off limits prospect adjacent to the Santa Monica beach. He had little hope for oil along the rest of the Pacific Coast or the Atlantic. Of course the current mantra is that if we drill off Oregon or Virginia there will be oil. I will be interested in current professional opinions.
http://hubbert.mines.edu

re saving it for the grandchildren: To me, this is the key rationale for leaving it there. If we extract it and "save" it in an easy-to-access location (like the SPR), everyone knows that we will tap it within years. This nation has the self-control of a four-year-old.

Even if we become unable to access it this time around, it's arguably still a good thing to have it available for the next rise of civilization, should that become necessary.

Gail,

Excellent posting, as always! I agree with all you have said. The oil addiction of the US right now will have to be broken soon either way (although the Canadian Oil Sands may extend it a little).

I have noticed that no one (that I have heard about here on TOD) has considered an obvious alternative to the US to increasing dependence on foreign oil (and paying for it) and becoming economically destitute in doing so. It is historically, by the far the most popular method by which militarily powerful countries have imposed their will upon smaller, resource rich countries. I.e. the capture of the oil fields by direct military (or surrogate "freedom fighters") action or other "non-economic" means. The US Navy is BY FAR the most powerful navy in the world and could easily dominate (and does dominate) ALL the world's navies put together. Even in the "heady" days of "Pax Brittanica" during the Victorian Era, there has never been a navy with as much dominance at sea as the US Navy has today. In fact, were the US to be desperate enough, NO oil tankers could travel anywhere in the world without the US Navy saying "OK". I am a little surprised that no one on TOD has done a calculation on the US having direct control (i.e. all export production or more) from Nigeria, Mexico, Venuezuela and Canada. How long would that allow the US to continue to consume oil at high levels? Militarily, I believe that it would be possible for the US to control all those Oil fields by some direct indirect way, if they were sufficiently desperate. I would think that the breakdown, or near breakdown of the American economy, with it very high dependence on oil, which might accompany a post-PO drop in production, might provide such desperation. There are few (if any) examples in history of a militarily superior nation "going down without a fight", but MANY examples of the opposite (i.e. trying to make up for lacking a resource by using a superior military). Pay attention to the stories about Chavez. A coup or a strong move against Venezuela MIGHT be an indication of such a strategy or a less severe version of it. There are many variations/alternatives to direct military invasion to gain effective control of a resource that have been tried (with varying degrees of success) in the past.

OF course, I hate to portray myself (even inaccurately) as a conspiracy theorist but as a student of history, I can't help but think this way. I have to ask if anyone else believes that the US would allow near total economic collapse without using its near total naval dominance to some effect, to "get the oil"?

Gail,

Your arguments are pretty convincing. Since we are entering the age of force majeure or a state of emergency, the only really persuasive reasons for not drilling would be that it doesn't pay financially. But investors are driven by the profit principle and if they are willing to put their money where their mouth is it would be ludicrous second-guessing for others to claim that they are mistaken in their calculations.

One tongue-in-cheek comment as to the peaking issue. Clearly since the US peak has already occurred new offshore extraction won't affect its date in the least. However, it WILL have some minor effect on the empirical validity of pure Hubbertian theory: its advocates will have to concede that peak occurred just a little bit more before the nation's oil was 'half gone', or keep defining oil down to exclude deep sea drilling or oil extracted from outside US territorial waters, etc.. I don't normally like to psychologise but perhaps the idea that the Hubbert Curve's predictive powers might be adversely affected by these new ventures makes its more purist proponents reluctant to welcome their implementation. Every billion barrels added to the country's 'ultimately' recoverable reserves is another nail in the coffin of Deffeyesianism, so to speak :-).

The drilling should wait until the majority of the US public and the politicians have realised and accepted that
(a) peak oil is happening now and
(b) global warming is an immediate, real danger to our civilization

Then and only then will the additional oil now still in the ground be used for all vital projects to reduce the impact of peak oil and to decarbonize the economy.

If this oil is used up now for consumption, in a last desperate attempt to rescue the car culture, it will be lost for ever and will not be available for these projects.

The drama unfolding now is that by the time it dawns on governments that all coal fired power plants have to be replaced by carbon-free energy as soon as possible, much earlier than 2050, all these projects will get stuck in diesel shortages.

Gail,

I think it's important to remember how we got to this point.

The ban on offshore drilling, and indeed much of the environmental movement, was initiated by the oil spill in the waters offshore from Santa Barbara, CA in 1969. A good retrospective is:

http://www.geog.ucsb.edu/~kclarke/Papers/SBOilSpill1969.pdf

This incident resulted from a drilling mistake as opposed to a tanker accident:

The problems began on an offshore drilling rig operated by Union Oil called platform Alpha, where pipe was being extracted from a 3,500 foot deep well. The pressure difference created by the extraction of the pipe was not sufficiently compensated for by the pumping of drilling mud back down the well, which caused a disastrous pressure increase. As the pressure built up and started to strain the casing on the upper part of the well, an emergency attempt was made to cap it, but this action only succeeded in further increasing the pressure inside the well. The consequence was that under extreme pressure a burst of natural gas blew out all of the drilling mud, split the casing and caused cracks to form in the seafloor surrounding the well. A simple solution to the problem was now impossible; due to the immense pressure involved and the large volume of oil and natural gas being released a "blowout" occurred and the 1969 Santa Barbara oil spill was under way.

....

From this point, the oil spread primarily west, toward the Santa Barbara coastline. Eight hundred square miles of ocean were impacted, and 35 miles of coastline were coated with oil up to six inches thick. The oil muted the sound of the waves on the beach and the odor of petroleum was inescapable. The ecological impact was catastrophic. Rescuers counted 3,600 dead ocean feeding seabirds and a large number of poisoned seals and dolphins were removed from the shoreline. The spilled oil killed innumerable fish and intertidal invertebrates, devastated kelp forests and displaced many populations of endangered birds.

This comment did not help:

I don't like to call it a disaster, because there has been no loss of human life. I am amazed at the publicity for the loss of a few birds.

President of Union Oil Co. Fred L. Hartley

Here is a recent story:

http://www.marketwatch.com/news/story/santa-barbara-learns-live-offshore...

Another idea being floated (sorry!) out there is drilling extended reach horizontal wells from onshore locations:

http://www.searchanddiscovery.net/documents/2007/07027bjorklund/index.htm

Similarly, platforms could be placed even further out with wells reaching back towards shore.

Anyway, while it is true that the proposed legislation would not necessarily allow drilling in this area as it is within 50 miles (and the Governator probably wouldn't stand for it), the risks (real and perceived) still must be weighed against the benefits.

Very good article. I am in agreement with your analysis and I too promote drill now. And I think you are correct in it isn't about getting the price of oil down. Oil is simply a valuable resource taht we will need now and in the future. BTW...I found this write up on the same topic by TOD friend JoulesBurn:

http://picojoule.blogspot.com/

IMHO I believe we shouldnt drill in ANWR or offshore
for the same reasons Gail mentions we should.
The popular reasoning goes.."Lets drill while we have
the resources of oil to drill for more oil"

I want to get on with the party and get to where we are all headed and will eventually arrive in any case.

Lets face the fact that the industrial revolution is
at closing time.
The bartender has called "last call for alchohol"

Lets use the last Petroleum whiskey shots we have on the bar counter before us to fortify our nerves to
stumble out into the nite and head back home together.

We can return too a more agrarian and social centralised society.

Screw globalisation and corporate capitalism...nobody
really was comfortable with the system anyhow.

Todays passions and leisure pursuits (hunting,gardening,fishing,crafts)Et cetera
were yesterdays mundane chores.

Tomorrows mundane chores will be yesterdays passions
and leisure pursuits.

When calories were hard to come by...its fat women who
were considered beautiful and when calories are easy
its anorexia thats in fashion...go figure!

I say lets party like its 1899..cause its gonna be
no matter how well you argue youre points.
But of course my thoughts were unsolicited and are worth exactly what they cost me too produce, never
mind.....it must be the scotch talking..say thats a
nice dress your wearing...do you come here often?

Gail,

I agree with your reasoning completely. I study Environmental Science and many of my colleagues find it hypocritical to support these drilling efforts, but we are going to need the oil, and now is the time, as you pointed out. The most iMPORTANT part of this is that politicians, specifically the next president, is able to promote drilling for this oil as well as the development of alternative energies. The recent price spike is demand driven, and requires a demand solution, i.e. conservation, not supply. I fear that the general public will latch on to this drilling idea and believe all our problems are solved.

While I agree that we should probably start to explore and drill select areas of these locations in a careful fashion, rather than in a desperate last ditch stand because we are flat out of oil, I do have issues with a couple of your statements.

While you would prefer to damage areas as far from population centers as possible I would prefer the opposite. Since by definition population centers have already badly damaged the land where they are located it makes far more sense to continue there rather than look for new areas to despoil. I have no sympathy for someone's view unless they are living in a tent. If it poor rich boys view from his mansion overlooking the sea that is going to be messed up well his house was built upon the backbone of the civilization that has been provided to him and they should be happy to do their part since they have gotten such rewards. Build the wind farm off Martha's Vineyard while we're at it! In fact I oppose the drilling if the wind farms are not approved as well. The human desire to mark every corner of the earth with their scat is not admirable.

My main issue though it relates to the above in a way is slightly different. You seem to believe that if Alaskans want to drill ANWAR then it should be their right and who are we to question. Well that is just bogus if you don't mind my saying so. Alaska is not a sovereign country and they do not own ANWAR. The American people do. They are the ones who get to decide about the drilling and Alaskans can participate in the discussion along with the rest of us. As someone who lived in Alaska I can attest that Alaskans often like to forget the fact that they are just one of 50 states and not a power unto themselves. Especially if they see some money in it. A common problem for us all, but not one to indulge either. I don't know how many times while the pipeline was being built I had some unpleasant conversation with a "native" Alaskan about you 'people' coming up here taking jobs that should have gone to real Alaskans. To these 'real' Alaskans someone from the lower 48 is no different than an illegal from El Salvador. A sour memory colors my thinking perhaps? Or perhaps people need to be reminded that we are all part of the same team, so to speak, and definitely in this together. This sentiment can be extrapolated to all humans being part of the same team (species) and in it together. American problems need American solutions not Alaskan solutions. Global problems need global solutions. Not American solutions. If every country pursues only what is in their best short-term interest then we all get to hold hands while we go down together.

But I do agree we need to start the exploration process now.

Wyo

ANWR, ANWR,ANWR!! Why does Big OIl have this obsession with ANWR??? Where are the demands to use the area of northwest Alaska actually set aside for oil production. The Alaskan Naval Petroleum reserve is much larger than ANWR and must have a reasonable chance of having significant reserves or it wouldn't have been established. Drilling in ANWR is more about gutting environmental regulations than it is about finding oil.
There is the question of competing needs for resources as well as financial capital. Isn't it a better use of metals and concrete to build wind turbines which are guaranteed to provide energy for decades to come than it is risk those materials on oil rigs which have a high chance of drilling dry holes? Even a successful oil well will go dry in only a few years then use expensive secondary and tertiary methods for only a few more years.

The "Drill here, drill now" crowd has turned an incredibly complex economic, social, and scientific problem (higher energy prices) into a simple phrase that will fit on a bumper sticker. It offers the false illusion that the only reason we face this problem is because of the short sightedness of environmentalists. It ignores the basic fact that Americans use a vastly disproportionate amount of energy compared to the rest of the world. It also ignores the years of bad policy choices that have put us into the position that we currently find ourselves (and not drilling off the coasts is the very least of these!).

The first step to solving a problem is to admit that the problem actually exists. Since when has API or EIA ever been willing to admit that peak oil is a problem?

To hold this discussion with the obvious overly
emotional sentiments leads any rational person to
conclude the necessity to promote a Manhattan scale
project to save the world...."Western capitalism"...
from the eminent apocalypse.

The poor in third world countries are gonna continue to live like they have.

They wont miss the Buick or 500 channels with nothing
on, because they never had that to begin with.
They wont long for a Quarter pounder and fries and a
trip to Walmart for some cheap plastic baubles.

My point being is....We are headed for a return to
the 1800,s
Might as well get a tee shirt that says...
"I came too the 1800,s and all I brought was this lousy tee shirt"
Or
"We went to ANWR and all I got was this lousy tee
shirt"
PO is PO so without further ado lets get on with it.

Wyo,
Please reread the interview.
They HAVE been drilling and with a couple of exceptions(like West Florida where they found gas, not oil) the results have been negative.

It makes no sense whatsoever to drill now(a hit or miss endeavor) when the price of oil exploration is in the stratosphere.
Wait until prices decline (and they will). The oil isn't going anywhere.

The best estimates of the CERA optimists is that GLOBAL offshore oil reserves are small, just 61G barrels, about 10% of Mideast reserves.

http://www.energybulletin.net/node/23977

Maybe that will shake you out of the trace you're in over US offshore 'potential'.

The only people who will make money in US offshore now are oil exploration company executives.

It is a good time to look at developing coal, oil sands, oil shale, etc. We know where they are. Just be sure to CCS-carbon capture and sequester them as much as possible.

A great summary. The best reason I have to support expanded drilling is to knock this nonissue to the side. It's a nonissue for short term supply or prices and it distracts from harder choices that need to be faced sooner than later.

There is a question of political tradeoffs. When Minnesota agreed in 1994 for above ground nuclear cast storage, we got an environmental tradeoff for the expansion of windpower. Perhaps we could use a little bit of leverage here and "trade" opening these regions to exploration for some serious money towards alternative energies OR towards a consensus that the U.S. SHOULD be planning to reduce our consumption of oil, perhaps a plan to set a "floor" price for oil as a way to reduce consumption and get alternatives going.

WELL, in short, I guess I'd support a little blackmail - holding offshore drilling hostage UNTIL the U.S. accepts a comprehensive energy policy for the future, including goals that fossil fuels consumption will be lower in the future.

OK, if we put ANWR & OCS on the table, my question is: what is big oil going to put on the table in return?

These should be worth a lot, and I expect a very high price.

My fear is that these are just going to be handed to them on a silver platter.

I have long supported drilling ANWR and increased off-shore drilling, BUT only after it has been 6 months since I have seen a Hummer, Expedition, Excursion, Sequoia, Tahoe, etc. on the road.

Two days down, 181 days to go.

We need to save this oil for our tractors, garbage trucks and truly essential uses, and not for the waste we have today.

Yes, we will likely be deep in Great Depression II by the time this last large bit of domestic oil goes into production, but that is exactly when it will do the most good.

Best Hopes for Prudence at Last,

Alan

Gail,

Thank you for another excellent post. A thought occurred to me when I looked at the graph of US production history.

The maximum rate of US production was about 10 Mb/d in 1970; current US consumption is about 20 Mb/d.

So, even the maximum historical production rate was only able to support *half* of current consumption. The postwar US consumption binge has been supplied to a major extent by cheap oil imports - the current level of consumption would *never* have been possible with domestic production alone.

All the talk about "energy independence (for oil)" is baloney. To achieve any semblance of energy sustainability, the US will have to cut consumption by at least 50%.

Twenty million b/d of consumption is a *huge* number for a single country. Conservation is absolutely mandatory under any scenario that I can imagine.

The only way I will ever support this drilling in ANWR and the restricted portions of the OCS is under at least one of the following conditions:
1. If our society experiences a massive paradigm shift beforehand relating to population growth and resource consumption policies.
And/or,
2. If the government nationalizes these projects and is forced by law to plow every bit of profit from these projects back into renewable energy projects.
Or,
3. If private companies maintain control of these projects, but are forced by law to plow every bit of profit from these projects back into renewable energy projects. That means BP, Exxon, etc. still maintain control, and they still get to make a profit, but all of that profit must be spent on things like building up a huge wind power division of BP, for instance (and this wind power division will then go on to make lots of profits for BP that BP can spend on anything it pleases...so clearly the private oil companies get their share of the pie in this arrangement, just in a way that also happens to help society in general).

I think option 3 is probably the most realistic.

I think the government needs to weigh the opportunity cost of the investments required to recover the additional oil in these remote areas and perform cost/benefit vs. other investments.

Could the government direct the oil companies to invest in conservation measures that would add up to more "oil" than is in the ground? Or could the government take the windfall profits away and invest in conservation directly?

For example, since this scenario has a significant time headway, what's the price of the rigs/pipelines/engineers etc. vs. the price of a national passenger rail network? Would a national passenger rail network offset more oil than is recoverable in U.S. territory?

My take on all this sudden drill drill drill hysteria is that this is an election year and its purpose is to get votes.

The republicans want convince the public that their democratic opponents are to blame for high gasoline prices. To the politicans driving this narrative, they are mostly unaware of peak oil.

Big oil really isn't raising much of a huge fuss about the chance of new leases being opened up, but they certainly see an opportunity to get some cheap deals because it appears the democrats are going to open up larger leads in both the senate and the house. It's most certain they're going to have to pay more for leases and may not get those offshore deals beginning next year. Since Bush is still in office, it makes sense to them for a last-ditch push to get ANWR leases on the cheap.

But long term, isn't is assumed that peak oil will result in some pretty awful scorched-earth practices to get those last drops of oil anyway? Sure, every available piece of land will get drilled eventually regardless of environmental concerns because people will be in a whole lot of economic pain.

I'd say drill it now, for environmental reasons!

For long I thought it'd be better to leave that oil in the ground forever. But the more I think of it, the more likely it seems it is eventually going to be drilled. So, do it while we're relatively well-off and can handle whatever environmental problems that drilling and extraction can cause. Oil drilling is a potentially very messy business, and if any major spill should occur, I'd think we would be more prone to clean it up now, than in a energy-scarce Mad Maxesque future (worst case..).

Not to be missed tonight at 7pm ET.

Larry Kudlow interviews GWB where they crow King Dollar and chant Drill Drill Drill together.

Apparently Bush is considering using his powers to remove the executive decision that placed a moratorium on the NO areas in the US for drilling.

Personally, this is fantastic news and I hope it occurs. We can all grow gray hairs and wrinkles waiting for the oil to come in. Hopefully, our kids and grandkids will use it wisely.

http://www.cnbc.com/id/15840232?video=781415075&play=1

I've been lurking here for a very long time, at least in the context of The Oil Drum's lifespan, having become peak oil aware in 2001. Suffice to say I’ve worked in the halls of power in DC for both the energy industry and nonprofits. I’ve come to be pretty sensitive to how issues are framed, because framing steers and limit the scope of debate and thereby help determine outcomes. The framing of Gail’s post strikes at the heart of the purpose of The Oil Drum.

Gail's post raises questions about the core purpose for the Oil Drum's existence: is it to help our society change as a means of adapting to energy extraction dynamics or is it to merely a means to watch what many see as a predictable societal crash landing and a tool to help us minimize the pain of this crash landing ourselves, everybody else be damned? Certainly it can be both, but the latter, while perhaps serving as a dark amusement and personal utility to some, would seem to have limited merit. I use this site as part of my professional practice to help understand how as a society we might minimize suffering and act with understanding and compassion in matters regarding energy development and use. I know that many others have a similar motivation, even if they might describe it differently, and that there is a great and healthy diversity of ideas about how to make positive change. However, I do not presume that this desire for change is true for everybody, and I have a strong sense that some have a much more individualistic or selfish (depending on one’s values) motivation for reading The Oil Drum.

If the drilling moratoria are lifted across the board and API gets what it wants I don't see how this represents a change from current energy practice. Although the API's/Gail's arguments all sound reasonable, I worry when the outcome of an argument is the status quo, particularly when this serves the interests of those making the argument. And before y’all jump on me about targeting Gail, I don’t mean that she has any self-serving interest greater than most of the people on this list who would benefit from immediate oil extraction by having this oil provide a “cushion” for the rest of our lives. API, however, certainly does represent those with a personal financial interest. Further, I define the “status quo” as meaning the extraction of oil at rates determined by big oil (including both private and national companies) and "the free market" as this term is used by the wealthy and powerful. Yes, I understand that the drilling moratoria could be seen as the "status quo", but I see the true status quo as drilling for oil to satisfy current needs to avoid near-term pain regardless of long-term consequences and suffering.

It may be that extraction and oxidation of this oil is inevitable, but assuming for the purpose of argument that this is true, the fact of inevitability says nothing about when, where and why such extraction should happen. These are much more important questions than “to drill or not to drill.”

The framing of Gail's post with the subheadings, "Why We Should Start Now" versus "Objections", sets up a simplistic yes-or-no structure that does not reflect the broad array of positive responses to peaking oil (many of which have been discussed here) nor the possibility that the answer may not be quite so simple. The question about whether, where and when to drill for oil creates a very important opportunity for a public debate about peak oil and the responsible use of oil. API has framed the debate as one about whether the broad restrictions on drilling for oil should be lifted as a whole. To my knowledge, API has not proposed any prioritization or schedule for drilling other than "as fast as possible in the way that makes us as much money as possible.” API certainly has the resources to propose something other than “open the doors and trust us.” But, API really doesn’t want an informed and intelligent debate, so they frame the debate as a go/no-go situation and outside this forum and similar forums, in the realm of Fox News et al., API or its close allies use American fear about oil price and supply as the primary justification for drilling, knowing full well that it won’t make a bit of difference to either. My understanding is that the industry wants to be trusted to drill when, where and how they see fit, and this simplistic framing supports their agenda. Hopefully, the debate here and in other places will look more deeply into these issues.

I am also concerned by the nature of Gail’s "objections." While they are a wash list of the sorts of objections one would expect to see in a lobbyist’s "one-pager" in Washington, DC, I think this framing likewise tends to support a simplistic go/no-go approach to this problem. The debate is framed as a check list of arguments against the range of expected objections, rather than framing this discussion as one about how our country should plan for its energy future and when and where these resources might be used. Other comments have touched on this lack of consideration of alternatives to drilling and appropriate time and place if drilling is to be done.

Gail includes some very cursory discussion of the needs of our grandchildren, etc, but again, the question is not framed as, "how do we plan for our grandchildren (and great grandchildren's future?" Rather, it says that we can’t be sure that they could extract it so we should just use the oil now. This framing is classic industry framing that tends to direct debate away from how we should plan to use resources and toward a simple go/no-go decision that keeps the industry in the driver's seat. Should this happen then the status quo about who makes energy decisions certainly will not change, oil will be extracted to meet current needs, and nothing much will change.

Also, I think some of API's arguments are suspect. I’ve used Gail’s headings for these thoughts.

Argument: Necessary resources available - Better use of existing pipeline systems

The rusting oil pipeline and disappearing drilling capability arguments seem speculative and overly simplistic. While pipelines are aging (as are we all) and peak oil suggests that drilling equipment will begin to decrease in availability, the impact of decreasing and changing oil supplies on pipeline utilization and development and oil drilling is a very complex question. If overall oil consumption drops dramatically, then planned pipeline operations will get pitched out the window wholesale and we should expect to see a consolidation of pipeline interests and/or perhaps a more "public utility" approach to pipeline infrastructure. Much of this equipment is going to be changed anyway, the question is when and where. It may be that the best pipelines are maintained and that a new generation of pipelines is built (such as is currently happening with tar sands pipelines). Just assuming that resources won’t be available in the future seems a bit too convenient.

Likewise, the value of oil may very well become so high that there is no paucity of resource availability for drilling or adaptation of current pipeline infrastructure. Certainly, current high oil prices are resulting in an increase in the existence of drilling equipment and pipeline investments, not a decrease. Yes, there is peak everything, but oil is a fundamental resource such that we should expect that the resources needed for its extraction will be one of the last things to go.

Mostly the API's arguments seem to be fear of the future wrapped up in rationalization.

Gail says:

"If we delay for say, another 20 years, the production window might be 2038 to 2060. Who is to say what the world will look like then? If we don't start now, there is a good chance we may never be able to access oil in difficult locations."

Yes, who is to say? API/oil industry is not prescient and seem instead to have been doing a really bad job of planning for our long-term future, which is sort of one of the themes of The Oil Drum. Chances are that in 2038 there will still be people that will need energy. That it is easier for oil companies to imagine near-term oil pipeline utilization and drilling scenarios and easier to imagine the possibility of a lost opportunity does not logically mean that later-term scenarios are not viable or that API's fears of lost opportunity are reality. Moreover, not all of this oil is in "difficult to access" locations, which again begs the question about where and when. These time-related arguments seem to say that to save our society for future generations we must use resources now, because future generations are unlikely to be able to these resources anyway. I think this is a questionable and, from a generational perspective, self-serving assumption.

If people need and want oil, it would seem more likely they will find the resources in the future necessary to drill for and transport the oil, unless of course everything has collapsed, but such collapse is unlikely to be determined by our access to these relatively small amounts of oil, and if such collapse happens then I doubt that having this oil will make that much of a difference.

Argument: Better energy return on investment (EROI)

I can see an argument for a better return on financial investment, but I'm not sure that the energy return on investment will change that much. As Gail notes, these are small locations. That's not going to change. The EROI for the infrastructure at these locations will likely not change that much. That oil companies have higher fixed costs relative to their overall production would seem to be inevitable, but what is the relationship between higher fixed costs and EROI? Will the EROI be that much lower because we drill now as opposed to later? The wider pipeline issues are more complex. Yes, being able to use existing pipeline infrastructure until it utterly falls apart would provide for more efficient use of the resources that went into building these pipeline and might delay the construction of new pipelines, but the degree to which this is important depends on the operating life of the pipelines in the areas that the industry seeks to exploit and the suitability of these pipelines for use in lower-flow conditions. Consider the Alaska pipeline. At what point is a new pipeline necessary? Before or after all is drilled in Alaska? If a new pipeline is necessary before any major expansions in Alaska then the resources sunk into the existing pipeline will have no EROI benefit relative to future efforts. Likewise, construction of new smaller pipelines throughout the country might be inevitable given the age of the existing infrastructure. Describing these concerns as an EROI concern seems to mischaracterize the real issue, which is better return on financial investment -- and this is important, but it's not the same thing.

Argument: Help cushion the downslope

The question here is, help cushion it for whom when? After years of watching public policy debates from the inside, I am concerned when the result of an argument is that those making the argument are benefitted to the exclusion of others who are not in a position to protect their interests. Do we really need the cushion as the time that Gail says more than future generations? All I see in Gail’s arguments are the truisms that this oil won't postpone peak and that it will help cushion the blow for some. This begs the question about WHO should get the cushion and WHEN they should get it. I don't see any arguments that the "cushion" is best used for our current of soft butts (which is what API proposes) rather than future generations. This seems self-serving, on a generational basis.

Argument: Protect (very partially) against the loss of imports

I've thought for sometime that the oil security situation in the US should be framed by this question: If the US has only ~3% of the world's oil reserves, why is our goal to extract the rest as fast as possible? I posed this question to a friend's 8 year-old, and after a few seconds of thought he looked up with a worried face and said, "3% -- that's not very much." He’s right. So I ask, why is API proposing to pump this oil out of the ground as fast as possible? If API has a proposal for limiting the rate of extraction of oil that is not based on the industry’s capacity to do so, I’d be interested in hearing such a proposal.

As for the thought that we should drill now and save some vast quantity of oil in some unknown reserves for future generations, I think this is utterly self-serving and fanciful.

Is our desire to extract this oil really based on thoughtful consideration of the future, or is it really just self-serving rationalization to satisfy our own needs to the detriment of those who will come after us? I remember Policy Pete bemoaning the demise of the big oil companies in the US, how they had become a shadow of themselves in terms of activities and resources in the US. Certainly those who work in the oil patch have self-interests for keeping the gravy train running as long as possible during their lifetimes. To a degree the oil industry’s interests coincide with the country’s interests, but only to a degree, and often they don’t.

I think the arguments here are crystallized in the final statement about James Hansen, where Gail says he said that this oil is going to be drilled anyway and it won't make that much difference to global warming. This same statement could be said about each of the remaining unexploited fossil fuel reserves in the Earth, as individual reserves. Moreover, it is also nearly a truism that all reserves will be drilled or dug at some point. Will the exploitation of a single coal mine change the course of global warming? Will turning off a light make a difference to future generations? Persevering any single resource or any small set of resources will not impact global warming, nor will it change our energy future. But, I believe that we should continue to take action that helps to reduce future suffering, and this may mean whipping up compassion for our kids and the less fortunate and saving something for them, rather than just believing our gross consumptive habits as inevitable. Otherwise, the Oil Drum really does become something of a gossip’s window on a neighbor’s tragedy.

How industry PR frames debates often says more about what’s going on then the words they say. API has framed its arguments so as to focus on bits of policy leading to a simplistic “to drill or not to drill” decision, rather than on the more important conversation about how we plan for our nation’s energy future, specifically whether, when and where to drill. We can prioritize, we can plan, we can decide not to give our needs the benefit of the doubt. The API's framing plays to this generation’s self-interests and focuses the conversation away from thoughtful policies for the benefit of future generations, because such policies might restrict the petroleum industry’s and its investor's financial interests.

The WWII generation has come to be known as “The Greatest Generation.” What will the boomers be called? How would you feel about, “The Luckiest Generation” or “The Most Selfish Generation”? How our current resource questions are resolved may very well answer this question.

Nice discussion, thanks.

I'd generally favored leaving it in the ground for later generations to decide, but the pipeline maintenance issues is well worth noting. I'm assuming that all this will get drilled sooner or later, the question is just optimizing when to do it.

The public discussions seem rather broken: a lot of people seem to think that "OK, drilling now allowed" somehow turns into "gas price drops tomorrow." :-)

How about a succinct post that summarizes intervals for all the various stages needed, plus current queue times for drill rigs, and such? I'd love to have that in one place to reference.

I do have one question about ANWR:

with AGW under way, it's going to get warmer in Alaska, which may change tradeoffs in building on permafrost, varying by location and rate of melting. Any thoughts about that?

My reason for opposing the opening of new areas to drilling is that it is a diversion of resources from what we should be doing. The returns are admittedly limited, the resource investment is admittedly considerable. Why then not invest these resources in the direction that we must move: away from oil.

This means restructuring our way of life, meaning: making it possible to live without cars, contracting our sprawling suburbs into denser communities that go up several floors and are walkable, bikable, near agriculture and parks and home to light industry. Investments in this kind can bring big returns for society.

We need to resist eating the bark off the trees, and starting planting more trees, so to speak. Our ultimate resources are the soil, the water, the trees, the oceans. That's what we will have left. We need to reverse course. You propose staying the course. I'm 'agin' it.

Perhaps I'm wrong but I get the distinct impression that there are quite a few people here who eagerly seek a return to the middle ages, an idyllic time preceding the "ugly, oil-based industrial culture".

While I understand that there is much to dislike about the present times, I think such attitudes display a profound ignorance of what life was like only 150 years ago. It was hardly idyllic and a time when forests were considered evil because humans couldn't survive in a forest.

If the oil haters get their wish, I doubt they'll be happy with what replaces the present age. I have a hard time imaging heating a house with solar in Ohio where the sun never shines in winter, or with a windmill. But I can imagine cutting down what little remains of the forests for firewood. I can imagine burning coal and wood for heat and cooking. Imagine 330 million people doing that every day! Emissions be damned. If people think oil causes pollution, they haven't seen anything yet. Very hard to be worried about global warming when you're freezing and starving to death.

Given that expanded drilling is almost inevitable, the PO side ought to work to maximize the conservation measures included as a tradeoff in the authorizing legislation. Increased cafe standards are one option. A 60 mph speed limit is another. Increased gas taxes and gas guzzler taxes should be on the table. Neighborhood electric vehicles should be authorized to drive more than 25 mph. European crash test standards should be allowed for cars that get more than 50 mpg. The time to make tradeoffs is now, while Congress is almost equally divided on increased drilling.

We're crazy not to be using our own resources. Much has changed since the 1982 offshore drilling moratorium was enacted. Drilling technology has advanced over the past quarter-century. Oil companies can drill more efficiently in deeper water with significantly less risk to the environment. "Compared to worldwide tanker spill rates, outer continental shelf operations are more than five times safer,'' according to the Department of Interior's Minerals Management Service. Domestic drilling would also create a huge economic boost to America.
Both US political parties cling to long-standing positions on energy - then blame their colleagues across the aisle for blocking their efforts.
The MMS overcharges oil companies just for prospecting rights alone, effectively stealing money that could be used to drill wells and find oil. For example the U.S. government just received $3.7 billion from company bids in a single lease sale in March 2008.
US oil companies have to weave their way through a labyrinth of environmental rules that Congress has imposed on them, plus defend themselves against bogus legal attacks from green extremists. The Government recently got $2 billion from Shell for offshore Alaska leases, then let lawyers stop drilling because the exploration ships "might bump into whales". The despots who sell us oil at $140 a barrel love the US government, we fund their entire bloated economies instead of using our own vast and abundant energy supplies.
Oil is the fuel of the immediate future - you can bet on it! We must move forward to a future in which cleaner natural gas, electricity, and renewable energy fuels cars and heats homes. But this transformation will take 20-30 years. In the meantime, the current Anti-American-Energy Congress has long pursued an energy policy that has done nothing to ease the price at the pump. Yes we need to wean ourselves from oil, but only as fast as technology can replace oil energy while we keep our country and economy safe. This is breaking the backs of American consumers and domestic industry infrastructure still dependent on fossil fuels, This is unacceptable anti-social, Anti-American behavior. Change is urgently needed.
Drill and drill now. We must take any and all action necessary to solve this very real crisis.
House Democrats keep blocking efforts to expand domestic offshore drilling. Not only has the Democrat controlled Congress failed to end our reliance on the Middle East for essential energy, they've actually helped grow that dependence to historic and dangerous new levels -- all because of their doctrinaire refusal to allow responsible energy production here at home.
Oil is the ultimate pocket book issue. Polls show that the price of gas is the No. 1 issue on voters' minds. A recent Consumer Reports survey found people place the blame for high gas prices first on the government, then on the foreign oil companies, and third is a tie between Congress and Middle East conflicts. In short, you the people are fed up.
Democrats need to announce their support for immediate domestic offshore drilling for oil and gas, ANWR oil production and oil-shale developments, to rapidly increase supply paired with investments in energy efficiency, if they are to have any hope of winning in November. Their "It Will Take Too Long, So Let’s Never Get Started" mantra is just plain stupid. Developing alternative energy will take even longer.
Creating alternatives to oil and gas isn’t as simple as flipping a switch or passing a mandate. Biofuels requirements for corn-based ethanol have already caused food inflation and global food riots. As for solar and other renewable sources like wind power that the daft media promotes. Both have serious disadvantages: the sources are inconsistent (the sun goes down and the wind stops blowing) and currently we don’t have the technology to store the power on a large scale. And they cost a lot more than existing energy supplies.
ANWR alone could be replacing 10-15% of America's imported oil within 3-5 years. Is anybody home in la la energy land?
The energy needs of the United States have made oil our number one import and the biggest factor in our imbalance of trade. It is not just that oil holds us hostage to the rest of the world. This imbalance of trade means we cannot support ourselves and must borrow from other countries every day just to get by.
There is an Urgent Need for Affordable Transportation Fuels Sourced in America;
1. There is no substitute for energy. The whole edifice of modern society is built upon it…. It is not “just another commodity” but the precondition of all commodities, a basic factor equal with air, water and earth. E. F. Schumacher (1973)
2. Energy is vital in order to create and sustain economic and social development. Our whole economy reflects the relative costs of energy: the cars we drive, the houses we occupy, the kinds of factories we have, and the equipment in them.
3. Hydrocarbons feed the world: About 97% of nitrogen fertilizers are derived from synthetically produced ammonia. Natural Gas-based Nitrogen fertilizer made it possible for us to populate the Earth, and now we're hooked. 40 percent (soon to be 60 percent) of the Earth's inhabitants thus owe their survival to natural gas, a non-renewable fossil fuel.
4. ...If we lost all oil and gas products tomorrow, .the world would simply collapse. There would be an immense depression beyond anything we saw in the 1930s -- the economy would go back to a primitive state. There would simply not be a functioning society. It would be as if there had been nuclear war, minus the casualties from blast and radiation... In a word, we cannot as a modern society or even a modestly industrial society live without oil and gas. That is, [it is not] a luxury or a narcotic. [It is] a basic necessity of life, as basic as almost any commodity there is. Ben Stein
"Before you get all excited about tearing down the energy industry, stop and think for a moment about what makes your comfortable life possible. Your heat and most of your electricity are provided through the burning of oil and natural gas. The thousands of plastic items in your home, car and office are all made from crude oil. Much of your clothing is woven of fibers made from petroleum.
Without the hard work and ingenuity of the men and women who work for the energy companies, we would be living in the 17th century - no electricity, running water, cars, trucks, airplanes, ships, factories, waterproof clothing, soda bottles, safety glass, sterile food and medical containers, air conditioners, televisions, microwave ovens, X-Boxes, I-Pods, or any of the millions of other products made using power generated from the burning of fossil fuels."

"You would have to grow your own food, or ride your donkey to a nearby market, where there would be no refrigerators or electric lights. You'd have to kill and clean your own meat and cook it over an open fire. You'd have to chop down the trees for your home, and provide your own light by making candles from the fat of animals. Every single thing in your modern life is utterly and completely dependent upon a steady supply of oil. Without it, the entire Western world would collapse completely in a matter of weeks; tens of millions would perish from starvation, exposure, and disease." Todd Keister
The concept of using the rest of the world's oil first before exploiting our own is outdated; at $140 a barrel its either the result of mendacious policies or just plain stupidity. It has resulted in incredible unearned wealth being taken out of the pockets of every hard working American and bestowed upon entities in other countries, including governments and despots, some who fund terrorism aimed at murdering Americans.
Rep. Scott Garrett (R-5) said that "it is our responsibility to develop sound policies that will ensure energy security. What is a good energy policy? A good energy policy gives you more energy. More supply. A bad energy policy is one that makes us less secure and more dependent upon foreign sources like Saudi Arabia, Russia, and unstable regimes like Venezuela. Using 21st-century technology, the option to pursue deep-sea exploration would allow for the increase of American supply and result in a decrease in gas prices."
US current batch of elected officials have a better chance to reduce Earth’s gravitational pull than to reduce gas prices using their current anemic plans.
Help the World's Poor: by developing our own energy supplies America would free up the 10 million barrels per day currently imported, for other poorer country's needs and thus help ameliorate energy and food prices. This would go a long way in assisting the developing country's populations to enjoy a better standard of living.
China is expected to have 140 million automobiles plying its roads by 2020, seven times more than now, fueling demand for transportation infrastructure and services. If you think oil is going to go down in price with all this demand increase, think again.
SOME RECENT PRESS
OPEC Chief Sees $150-170 Oil in Coming Months; Crude oil prices could rise to as high as $170 per barrel in the coming months but are unlikely to hit $200 and should ease towards the end of the year, OPEC President Chakib Khelil said in an interview on Thursday. Source CNBC 26 Jun 2008.
OPEC President Chakib Khelil also said "...Threats against Iran would also support prices during the summer. A political crisis that would stop Iran's oil production would push prices over $200 a barrel, to possibly $400 a barrel, he said...." Source Bloomberg June 26th 2008
"....Are the ridiculously high prices we’re paying the fault of the big, bad oil companies? No, the lion’s share of the blame goes to politicians, who have locked away vast amounts of American energy -- both oil and natural gas.

In the 1980s, Congress began restricting more offshore areas from energy exploration -- prohibiting drilling in more and more places around the country. With energy relatively cheap, it was easy to give in to the carping demands of radical environmentalists, who (then as now) exaggerated the impact of drilling and downplayed the benefits.

Then, in 1990, President George H.W. Bush issued a directive restricting new offshore exploration and drilling. President Bill Clinton compounded this error in 1998 by extending the directive to 2012.

Fast forward to 2008, and it’s abundantly clear that we can’t leave huge deposits of energy to remain buried in our own backyard for another four years...." Source
Poll: 74 percent support offshore oil drilling in U.S.
Three in four likely voters – 74 percent – support offshore drilling for oil in U.S. coastal waters and more than half (59 percent) also favor drilling for oil in the Alaska National Wildlife Refuge, a new Zogby International telephone poll shows. Zogby International, Thursday, June 26, 2008
June 26th 2008. Alaska Governor Sarah Palin believes more oil and gas production from ANWR and offshore is crucial to America’s future..
"...the people who live here, want it drilled"
"Obama is way off base on all that. I think those politicians who don’t understand that we need more domestic supply of energy flowing into our hungry markets, you know, they’re living in La-La Land. And we’re in a world of hurt if their agenda continues to be to lock up these safe, secure domestic supplies of energy... "the people who live here, want it drilled. So that tells you that we have confidence in the safety and the responsibility that we’ll see there with the development of ANWR......"
Kudlow: Why don’t we just liberate, and decontrol, and deregulate the whole bloody energy business – whether it’s oil, gas, shale, nuclear, coal, natural gas, as well as wind and solar – why don’t we just decontrol, deregulate, go for an America first energy policy? Get independent of Saudi Arabia? America first. Create all of these millions of high paying jobs. Why isn’t anybody talking about that in this race? That’s the natural, Reaganesque thing to do. Isn’t it?

Palin: Yeah absolutely! You’re hitting the nail right on the head. That’s what so many of us normal Americans are asking. The same thing. Why aren’t the candidates talking like that? Where we can secure America and we can be more independent when we talk about energy sources if we could drill domestically.

Here we sent [Energy] Secretary Bodman overseas the other day, and our president had to visit the Saudis a few weeks ago, to ask them to ramp up development. That’s nonsense. Not when you know that we have the supplies here. You have the supplies in your sister state called Alaska, where we’re ready, willing and we’re able to pump these supplies of energy, flow them into hungry markets across the U.S. We want it to happen. It’s Congress holding us back...."
Source: http://www.cnbc.com/id/25394468
It would help if Politicians from both parties should stop telling energy mistruths to the America people.
The Congress's current energy plan is a bit like saying that during a famine the solution is to tax the farmers more. The Democrats energy policy unfairly punishes their union base. More US oil and gas exploration would mean millions of good paying jobs for American engineers, oil field workers, pipeliners, steelworkers and all the associated and downstream service industries involved.
Under our energy plan all these millions of people working in US on domestic energy projects would be able to buy a house here not fund someone else's in Venezuela or the Middle East.
Democrats now propose punishing everyone in sight; giving the federal government more authority to crack down on price-gouging by oil companies and smaller vendors, a bill requiring energy producers to relinquish any land not currently being tapped for oil or gas production, and a measure creating new restrictions for commodity traders whose speculation who they consider might have driven up the price of oil. Even a small child could figure out that none of these punitive measures will have any measurable effect on supplies or gas prices. We need more affordable supplies not more useless rhetoric.
Currently, sending $600+ billion a year overseas for imported oil is creating millions of jobs and untold wealth in other countries!
The American people don't need psychological relief or meaningless gimmicks ... they need real energy relief that will help them fill up their tanks at an affordable price and jobs to put food on the table. They need a new aggressive America-First Energy Plan.
The facts are:
There is an urgent energy emergency facing America today, causing the current recession to deepen rapidly. Much of the recessionary causes can be traced back to the increasingly high price of energy and the fact that 60% of the US oil requirements are imported resulting in $600 billion + p.a leaking out of the US economy. The energy crisis negatively impacts every citizen, business, and government entity in the country, as well as world markets.
The American economy is in dire peril at this time. Most of the malaise can be directly traced back to energy supplies and the ever-increasing price. Net petroleum imports represented 41 percent of the total 2007 US trade deficit and the number will be much higher this year.

Most oil producing countries around the world are nationalizing their oil reserves, increasing export taxes, cutting off needed investment, and many are reducing export production capability in order to supply their own rapidly growing local needs.
There needs to be recognition that the depletion rates of existing mature oilfields world-wide are rising, and new oilfields are not coming online fast enough to replace the existing production capacity.
We are entering a new world order in which other countries with increasingly larger financial resources are competing for internationally available oil and gas resources and increasingly winning dwindling supplies by paying more, (China, India etc.).
Just as the developing world’s oil demand is exploding, the world’s largest and oldest oilfields (and some newer offshore fields, too) are declining more rapidly than oilfields used to decline in the past. Just at this juncture of rising demand and stagnant supply, five countries that together produce some 13 mb/d of oil and, more importantly have the potential to produce an additional 5 - 10 mb/d, have become saddled with governments that are so incompetent, corrupt, and/or crazy that they cannot operate their oilfields rationally.
At the same time, oil producing countries have created State-owned companies to control their own oil and gas resources and extract the maximum revenues from them, resulting in the locking up of over 80% of the world’s energy reserves from access to independent oil companies (IOCs).
America is the worst offender in blocking off access to its own oil and gas resources due to politically-created offshore and onshore drilling moratoriums, onerous taxes, imposts, bizarre regulations and laws. For example only a shameful 3 percent of the United States’ 1.76 billion acre outer continental shelf (OCS) is leased for oil and gas exploration and development.
Virtually every other country in the world is drilling on their continental shelf and onshore sedimentary basins to find oil and gas, very often using American capital and technology. Why is this happening? It is primarily because American politicians at the Federal, State and local levels have made it increasingly difficult if not impossible to produce oil and gas in America by closing the Offshore Continental Shelf (OCS) and other areas with moratoriums and with an ever-increasing array of permitting requirements as well as onerous taxes and imposts. Hence American energy exploration companies have moved resources to other countries where energy prospects are available for development and the permitting requirements are easier. IOCs often accept a very small profit participation because increasingly that is the only business opportunity open to them. Hence vast amounts of American financial, engineering and entrepreneurial capacity have been wasted away.
For politicians and commentators to continue blaming independent oil companies for the high price of energy is an outright falsehood and a bald-faced lie. It is the decades-long inactions of American politicians themselves who have created the current American energy crisis.
With America facing it’s worse energy supply crisis it is high time for bipartisan affirmative action.
It is fiscally irresponsible (no, mindlessly stupid) to send more than $600 billion each year to other countries that are a lot smarter about energy than we, because they are willing to develop their own oil resources and sell them to us at a huge profit while we are not. This includes America-hating despots who sell us oil every day at a huge profit and are laughing all the way to their Swiss bank with our billions.
Without sufficient domestic oil and gas production Americans are being held hostage to foreign producers.
Environmental Impact Misconceptions
Oil exploration and production off the coast of Louisiana has been going on for decades, providing a shining example of the safety, effectiveness and limited environmental impact of modern exploration technology. All around the world today, countries drill offshore without significant environmental consequences, then sell the oil to us and make their companies people rich off our backs.
There is something immoral about refusing to drill in your own backyard because "it is bad for the environment" while being perfectly willing to buy the oil pulled out of someone else's back yard. We use oil and gas, therefore we should be willing to accept the responsibility to find it on our own soil and deal with the (minimal) environmental risks of that process.
There hasn’t been any significant oil spill from U.S. waters in over thirty years. The oil industry now has an excellent environmental record. The amount of new technology, redundancy testing all but eliminate that as a possibility today.
True effect of Oil Spills
Vast amounts of oil and gas are constantly leaking out of the world’s natural oil and gas reservoirs. Global emissions of potent greenhouse gas methane from natural marine seepage have been underestimated and are beneficially decreasing because of oil production reducing reservoir pressure. A huge fraction of the world's total oil and gas is episodically or continuously bypassing underground reservoirs completely and seeping from surface sediments on a large scale. Recent satellite photographs show numerous of oil slicks which go for miles in the Gulf of Mexico and elsewhere, in areas where no oil production is occurring.
There are even naturally occurring microbes that live off oil and gas seepages.
Example; The 1969 Santa Barbara spill that occurred after an oil platform blew out six miles offshore leaked oil into the ocean.
But Santa Barbara oil reservoirs are today naturally leaking an estimated 187 barrels of oil each and every day. That’s around 70,000 barrels a year, or nearly 3 million barrels since the 1969 oil spill.
Yet the local population, faced with these incontrovertible facts, still blindly refuses to let oil companies extract the oil, which would result in reducing the offending reservoir pressures hence stopping the damaging leaks.
The local offshore natural oil seepage causes more air pollution than all of the vehicles in Santa Barbara. These natural seeps are a large source of air pollution in Santa Barbara County. One estimate suggests air pollution is equal to twice the emission rate from all the on-road vehicle traffic in the county. Redondo also has huge ongoing natural oil seeps, read this article.
Timeline Lies
Many shortsighted politicians dismiss the opening up of US moratorium areas with statements such as, “it would take decades to bring the oil and gas to market, so let’s not bother”. This a not correct.
Its simple to get new American energy supplies quickly, Appeal to Corporate Greed: If oil companies are given enough financial incentives, they will move much faster than anyone believes and could find and start producing new oil and gas within 2-3 years, then ramp quickly up to produce enough energy to completely replace oil imports within 10-12 years.
Come November any candidate for any seat who does not wholeheartedly support developing America's own energy resources immediately, is likely to get hit by a virtual "voter rejection train", poetically loaded with imported $5 a gallon gasoline from Chavez, Iran and Russia.

AMERICAN ENERGY FOR AMERICAN'S: BASIC ELEMENTS FOR AN ACTION PLAN
Proposed Presidential Executive Orders:
Declare an energy emergency and set aside the OCS and ANWR moratoriums and some permitting requirements so as to fast-track various critical new energy developments.
Declaration granting a tax holiday for declared special "American Energy Economic Zones" (AEEZ), see below.
Declaration temporarily eliminating up front oil and gas lease payments, royalties and other imposts, as well as regulatory delays.
Declaration making available $200 billion p.a. in low-cost construction financing guarantees and other incentives for new energy projects in AEEZ areas.
Proposed Government Actions;
1) Cancel the Moratorium on drilling on the US Continental Shelf today.
2) Cancel the Moratorium on drilling on the Artic National Wildlife Refuge (ANWR) 1002 area today.
3) Support the three international waters resources rights Claims made by American Companies to contiguous oil and gas reserves that could be developed without any regulatory lags. (See; www.strategicnine.com and www.unoilgas.com ).
4) Put aside most of the timeline and permitting requirements for urgent, identified critical energy projects as listed here in declared "American Energy Economic Zones" (AEEZ) “in the national interest” by creating a fast-track office to evaluate and approve requested leases within 90 days.
5) Allow unsolicited OCS Lease Applications anywhere immediately, grant them on a first-in first granted basis.
6) Enlarge new OCS post-moratorium lease block sizes from the paltry 5 mile by 5 mile area to a more realistic size of perhaps 100 miles by 100 miles in frontier regions.
7) Provide a ten year tax and impost holiday on strategic new oil and gas development projects in AEEZ areas. Offer matching funds for seismic and EM surveys to be repaid from eventual production to get oil flowing sooner.
8) Provide low-cost loan guarantees for development of urgently required new oil and gas project infrastructure in AEEZ areas.
9) Provide low-cost Government guarantees or loans for offshore oil and gas ("Energy Liberty") ships and vessels built to work in the US AEEZ areas for the next 5 years.
10) Temporarily exempt approved oil and gas projects within the AEEZ areas from the US Cabotage laws so that projects can more quickly secure production equipment from overseas shipyards.
11) Set Aside Regulatory Delays for projects within the AEEZ areas. Make regulatory bodies set up departments to “fast-track” approval of energy projects to clear hurdles within 3-6 months.
12) Eliminate Frivolous and Mendacious Lawsuit Delays for projects in AEEZ areas: Create a special court to hear energy related cases with a mandate to adjudicate cases within 7 days. Example: the lawsuits currently stopping Shell from drilling off Alaska, partly on the basis that their ships might bump into whales; if applied to the rest of the world’s oceans would cease all shipping and world trade!
13) Provide 250,000 new grants for students to pay for college for future petroleum engineers and geologists, and for technical petroleum production job training programs.
14) Eliminate any royalties, taxes and permitting costs on critical new energy projects in AEEZ areas for ten years, to enable energy companies to spend every dollar of risk capital they have on US drilling, building production equipment, and related expenses, as only holes in the ground will solve the energy problem.
15) For transport; Provide tax and other incentives to build distribution infrastructure and car-truck conversion stations to switch 25% of the US vehicular fleet to compressed natural gas (CNG) within 10 years. This will lower demand for oil and lower CO2 emissions, and would require approximately 5 Trillion cubic feet (Tcf) per annum of gas.
The Solution to high oil prices: An Energy Mini-Marshall Plan
Why this will work:
These are real solutions not thinly disguised and choreographed political stunts designed to win elections rather than bring Americans gas price relief.
Create an American Oil and Gas Rush: We need to get those independent oil and gas companies, their money, explorationists, engineers and drilling rigs back into American waters promptly.
The US government must make it so financially attractive for oil companies to immediately explore and develop American oil and gas resources that the new policies create a veritable stampede to bring new domestic oil and gas to the market in record time.
If American politicians created the financial and other incentives outlined here, all those drilling rigs that are working in other countries’ continental shelf regions will come back to the US and find affordable oil and gas for Americans.
This plan promotes improved National Economic Security through common sense domestic oil and gas developments.
This plan will result in energy jobs coming back to America. It recycles virtually all of the energy money back to the US economy in taxes, dividends, jobs – high paying blue-collar jobs and white collar jobs. Billions of Dollars would get recycled through taxes. A lot of those billions could go back to the adjacent states and help them balance their budgets.
This plan would unleash an immediate tidal wave of exploration and development in the American OCS , resulting in early and growing domestic oil and gas production, that would soon replace all imported fuels.
Rapidly developing America’s own energy resources would have a price-damping effect: The mere threat of future US domestic supply competition would cause Organization of Petroleum Exporting Countries to cut their prices. The U.S. Congress should take notice: economics do work - not just cutting demand, but robustly increasing supply of transportation fuels will get us out of the current oil crisis.
How to get new American energy supplies quickly, Appeal to Corporate Greed: If oil companies are given enough financial incentives, they will move much faster than anyone believes and could find and start producing new oil and gas within 2-3 years, then ramp quickly up to produce enough energy to completely replace oil imports within 10-12 years.
Example: Kellog, Brown and Root (http://www.kbr.com) recently designed and built the world’s largest floating oil production platform in just 12 months, the "Agbami". Where did it go? To Nigeria, where the "Government" is taking 90% of the revenues off the top, much of it disappearing into Swiss accounts.
Time to first oil and gas could be compressed from the typical 5-8 years to 2-3 years for some American resources if enough manpower and capital was directed to the projects. Just give the companies enough incentives and they will rise to the challenge.
American companies are bringing some oil and gas projects into production in less than 3 years in other countries right now.
This viable energy plan would significantly increase the security of the American homeland, create ten million new jobs for Americans and their communities, provide for America’s energy independence for 50-100 years as well as generate untold trillions in new taxes all within America and hence rapidly improve the general economic well-being.
We urge the US government to adopt this simple Energy-Economy Revitalization Plan - this is a blueprint that could be refined, improved and launched within just a few weeks.
All of the above measures would create a massive stampede of exploration and oil and gas production infrastructure on the US continental shelf and other US onshore areas, creating near-immediate increases in oil and gas production, hence rapidly lowering US consumer’s energy prices.
Much of the new offshore energy production would be in the form of Low CO2 natural gas, which, when used to make electricity or compressed natural gas (CNG) vehicle fuel, reduces CO2 emissions significantly, thus helping to meet much of the proposed US Cap-and-Trade carbon reduction objectives.
Stop Bureaucratic Tax Creep: Unfortunately US bureaucracies often tend to make decisions based on the individual Department’s staff’s own perceived self interest. For example, the more royalties and fees they secure, the larger and more important the department is and the greater salaries and benefits that accrue to the staff. These fees, payments and imposts are today a major drain on oil and gas exploration capital. It is money that would otherwise be spent exploring to produce more oil and gas.
Government must leave these department heads out of the room when making critical decisions about the energy issues. The issue is too important to let self-interested bureaucracies to continue to destroy the American economy with ever-increasing arrays of hidden energy taxes and imposts.
The benefits of developing America’s own oil and gas include an estimated $600-$700 billion per year in oil payments, currently going overseas, that under our plan would stay inside America creating millions of new jobs and prosperity, here, not there.
In order to salve the consciences of the affected bureaucracies perhaps the small amount of revenue lost could be simply replaced by adding a small tax (5cents/gallon) on at the consumer end (the back end) to replace the current onerous crushing front end pre-exploration imposts. It is likely that the resulting ultimate revenue flows to the various bureaucracies would be much higher in the long term. Thus America’s security would be enhanced. The consumer would enjoy lower prices and a secure supply for 50-100 years, as well as enjoy the benefits of millions of new jobs for Americans.
This plan is not a gift to the oil companies, its simply giving back to American's what we already own, our own oil and gas supplies, on our own soil, owned by us all, which have been inadvertently taken from us by our own government and bureaucracies.
The above measures would bring about the transformation of the American energy industry and indeed create a boom in the entire US economy within five to ten years.
Note; Nuclear, solar, geothermal, coal and other static energy sources are not covered or dealt with in this proposal, which focuses primarily on QUICKLY providing more domestically sourced transport fuel.

See; http://www.strategicnine.com/STERLING-AMERICAN-ENERGY-PLAN.htm

==For US produced off-shore oil, there have been no major spills in 25 years, even in hurricanes.==

Or to reword that.
The last two major hurricanes spilled over 740,000 gallons of oil.
http://thinkprogress.org/wonkroom/2008/06/19/mccain-katrina-spills/

Go for it!

I'm with Dmitry Orlov on this. The more quickly industrial capacity is wasted on boondoggles, the easier the transition will be, when it comes.

And who knows? Maybe it will delay the next oil war, if Congress thinks it has reduced gas prices and thereby preserved the American way of life.

But, Gail, we also need to advocate federal subsidies for drilling the Bakken, and oil-shale mining.

No discussion about the need to stop immigration into the United States and quickly develop strong social and economic incentives not to have children or have one child and adopt beyond that one -- basically reduce the human population of the United States.

Unless the human over-population problem is acknowledged and accorded its correct position as the Number 1 problem facing our species, and acted on, not much will be resolved. Indeed, more people clamoring for finite resources translates to a higher prospect for war, possibly the last war.

Will we really need the oil in ten years? What about biofuels and new transport techs?

You might think biofuels are a joke or a fantasy, but OPEC is terrified. In their last meeting, the Saudis asked for reassurances from oil consuming nations that we wouldn't switch to biofuels. Otherwise they feared that new drilling today wouldn't pay off tomorrow. They could be right.

Drilling in the US now is a good idea in my opinion, but it's a small idea that doesn't change much because there's probably not much oil from what I understand (I could be wrong of course).

Ever heard of Synthetic Genomics? I'm referring to Craig Ventner's new company, whose main goal is to genetically engineer a great biofuel. Remember how people said that decoding the human genome would take decades or even longer? But Ventner knew that while he was making advances in the genome, others would be making advances he could take advantage of. Computers would be faster, other sciences and technologies would be coming online. And the genome was decoded in amazingly fast time compared to what people had thought was possible. This development was akin to the idea behind "The Singularity" discussed in a previous post. I think the same thing will happen in biofuels, with Ventner's or other companies.

Before those 4th generation biofuels are ready, we'll need other sources. But oil continues to climb in price as demand still outstrips supply despite the high prices (88 million barrels a day in demand, 86.6 million in supply). In my opinion demand destruction (i.e. a global recession/real stagflation) is in large part being forestalled by Chinese and Middle Eastern fuel subsidies.

Sugar ethanol could supply an additional, say, one million barrels of oil equivalent a day in the next year or two if there were a truly serious push. That number could rise further and quite quickly because there's room for more crop and the technology is simple. It would come from places like Brazil, India and possibly other less traditional sugar producers, including the US Gulf Coast. However as an agricultural item there are many trade restrictions and tariffs that are discouraging this. Brazil is currently only using something like 1% of its agricultural land for sugar production. And sugar sweetens food, but it's not a stable like corn so people won't go hungry. Of course to avoid any serious answer to the oil emergency we face, Congress chooses to waste time by blaming "speculation" so that the public stops blaming the government! But where's the substantive action? Immediate and massive ramping up of sugar ethanol should be a no-brainer. Of course the Farm Lobby can do a lot to stop it, and they do. Here, in Europe and elsewhere. It's disgusting.

Why don't people at the Oil Drum talk more about biofuels? A fleet of cars can take twenty years to change. A fuel could take much much less. Of course non-fuel cars, electric cars for example, will help and it's all needed. Imperfect biofuels like sugar ethanol can be a start, holding us over until something better arrives. We need to invest heavily in real change, a roadmap to energy and eco security. There needs to be a political outcry, not just moans and groans blaming speculators or plans to drill up small lakes of oil in ten years. And wind and solar don't fuel up cars, ships and planes, at least not yet. But the problem is now. $140 oil is no joke. $200 oil isn't either. I'll have to move to Dubai soon...

I'd say that we shouldn't drill in ANWR, especially now. If we drill now, then although we'll still have to wait a few years, we will be consuming it while we're still pretty energy rich. It will be used to lower money spent at the pump a few cents, and to free up more oil so that other countries can grow their economies and populations even more.

If, however, we left it until a dire predicament started to unfold, then the oil might just be used to save lives. We are leaving ZERO oil for future generations as it is, and I doubt that we'll have the technology in the next 50 years to run some things that we use now, like airplanes, without oil.

If we use ANWR now, we're letting the SUV drivers get off with taking that extra long-drive. If we used it in a few decades, we might be letting people live who might otherwise be dead.

I realize that ANWR WILL be used. There's no doubt about that. But I think that the question of WHEN is also valid.

Having said that, perhaps drilling now is a good idea. When it's flowing at its fastest rate, and oil is $500 per barrel (lowered from the $520 it would be without ANWR), and we realize that causing environmental damage while completely wasting the precious assets that our children will never see didn't even help us all that much, then there will be nowhere for the deceivers to hide. No last resorts to put the blame on others (i.e. people who care about the environment - something that some people have forgotten sustains all life, including human life). Then, we will finally have to accept peak oil.

It's funny that the majority of people who want to drill in ANWR now are the same people that say that oil isn't running out - that we have a lot left. If that were truly the case, we wouldn't have to use the very last bit of our oil - a six-month supply (if it were used exclusively during that time).

If drilling can put an end to the deception by these people, I am for it.