So McCain has flip-flopped on off-shore oil drilling, and unsurprisingly Bush also wants to allow off-shore oil-drilling. Then of course there is the need to drill for oil in ANWR, according to them.
But what they don’t mention is that these policies will have little affect on gas prices both because it will have little affect on the world oil supply and not to mention that those areas could not be developed for years to come.
And then there is talking out of both sides of their mouth, as McCain believes we need to end our dependence on oil, yet wants us to drill for more oil. Bush says we need to reduce our dependence on oil, yet he wants to drill for more oil.
This is another populist ploy that sounds good in soundbites but is not a solution to any of the problems, from high gas prices to global warming, facing the country.
Well, there is no reason to suppose demand for oil will go anywhere but up as China and India become larger and larger oil consumers.
On that basis you need more oil to meet that demand or you get higher prices. Whether this would provide enough to mitigate costs I have no idea but it is safe to say if you want more oil may as well get cracking on building new drilling platforms now.
Not saying I like the idea myself. Have not really looked in to it. Just saying that taking several years to come on line is no reason not to by itself. If anything it argues to start ASAP rather than later when prices are even worse.
I saw a debate on ANWR yesterday. If the guess of what is there is correct ,it will result in a 3 month supply of oil for America. It will take 10 years to get in on line. If the higher estimates are correct it could be an 8 month supply. It does not solve anything.
However if the rights to drill are awarded to oil companies , they automatically show more potential oil on their books. this raises stock prices and net worth. It is being awarded the rights that matter short term.
That’s not double talk. You can want to move towards alternate fuels while still realizing that the current economy runs on oil. Besides - dependence on foreign oil is a big issue too, rather than just oil in general. I don’t see anything inconsistent about their position.
They could drill there a lot faster and easier than in Alaska. The editorial opines that the reason for this is to grab the leases before their lackey leaves office. Sounds plausible to me.
That might be true if you pushed conservation, alternative fuels, and additional exploration. The current administration has been against conservation, and alternative fuels have either been pie in the sky technologies like hydrogen or politically expedient ones like biofuels. The Procrastinator in Chief has pissed away seven years where something could have been done to avert the current situation.
Just a little more tweaking of the infrastructure (hydrogen filling stations) and millions of people could be driving these feasibly in a decade or less.
No need to replace roads, etc.
Well, call it that if you like, but when he held that original position gasoline was quite cheap and had been for years.
I have heard quite variable opinions on what we really have yet in the ground, everything from a few month’s supply to levels superior to Saudi Arabia’s reserves.
It’s worth it in the short term as we transition away from gasoline-powered cars to keep supply and prices stable.
Personally I believe that to not take advantage of the opportunity to at least find out how much we really have and how hard it would be to get it logistically and environmentally is madness.
Just making sure the concept is clear, but the idea that ANWR is a 3- to 8-month supply for the US assumes the the field would be the sole supply of oil for the entire country, which of course would never be the case. That’s really just a quick journalistic shorthand for comparison of the presumed reservoir volume to our current energy needs. In any event, the technical means do not exist to produce the area at a rate that could ever make it our sole source of supply at our current rate of consumption. No matter what happens, it will take 5-10 years to ramp up production, and most likely at least 20-30 years to deplete the resource. That doesn’t mean the ANWR reserves, if they exist, are completely insignificant, however.
It’s quite true that exploiting the ANWR for oil, or not, is unlikely to make an enormous difference in world supply or prices, but that’s pretty much true for any single oil or gas province at this point. The question is at what point (if ever) it might be worthwhile to add those reserves to the known supply. If the answer is ‘never’ that’s fine with me, but it will result in some unknown (if small) increment of increased price and less availability of oil somewhere down the line.
I don’t have the impression that the writer has much of an idea how leasing and exploration are actually conducted. The one premise I would agree with after a quick scan of the article is that there is indeed a great incentive for oil and gas companies to lobby for expansion of the authorized areas for offshore drilling while an industry-friendly administration remains in office, but I didn’t need an NYT editorial to tell me that.
Just pointing out so it’s clear: leases are not necessarily fields. Most of the time when a lease on federal land or waters is granted by the government, the amount of oil or gas in place is not known; it takes seismic evaluation and exploratory drilling to determine whether economically viable production exists. Seismic surveys and exploratory drilling is costly, especially offshore, and there is significant risk involved. Since historically the majority of exploratory wells have been dry holes, the companies involved tend to be rather cautious about where they drill, and will acquire more leases than they can feasibly drill as a hedge against having all their exploratory eggs in one basket.
One more thing: lease terms are finite, and they revert to the owner (the government) after a fixed term. While this isn’t my specific area of knowledge, AFAIK many lease also have ‘use-it or lose it’ clauses; if the lessee does not drill one or more wells during defined period, they risk losing their rights.
The editorial seems to imply that oil and gas companies are sitting on vast known reserves and deliberately not drilling them. That may indeed be the case in some situations; for one example, it is not unknown for oil and gas companies to acquire leases surrounding known discoveries as buffer zones to keep other companies out unless they are willing to sign a risk-sharing agreement, or in the hopes of finding an extension to a known reservoir structure. Who knows, maybe some companies are sitting on leases to drive up prices, but it’s not obvious to me, and since leases are acquired by sealed bid, they have to pay quite a lot for this privilege.
Oil drilling in the gulf is expensive. I used to live around there, and I used to own stock in a platform company. I can certainly understand that in a situation of low prices and overcapacity, which was the case until fairly recently, it wouldn’t make sense to do a lot of exploration or drilling. I assume they are pulling out all the stops finding new holes to drill in places where they already have leases. They don’t need anyone’s permission to do that.
I’d think that there is a stronger case for resuming drilling off the California coast. However, no one around here trusts the oil companies very much. They screwed up, and now they’re paying for it.
The editorial carefully says that the reserves are believed to be there. Clearly no one knows anything for sure.
The editorial mentions a push to write use it or lose it (or use it or don’t get more ) into law, so I doubt the leases already have this provision - or the lose it is so far out in the future as to be irrelevant now.
The editorial carefully says believed reserves, not known reserves. As for sitting on known reserves, we can see from OPEC that it is not necessarily on one’s financial self interest to pump everything you got. If the oil companies want access to ANWR, it doesn’t make sense for them to start bringing lots more supply on line from existing fields. Given the profits they’ve been making lately, I doubt that they are feeling a lot of stockholder pressure to increase revenue.
In addition, the government hasn’t done a real good job getting the maximum out of the companies - and that goes for all administrations, not just the present one. Finally, the oil in the ground up there is going to be even more valuable in the future. Why not hold on to it until we have safer ways of drilling?
Creating an infrastructure of hydrogen filling stations is not just a “little” tweak. I’ve got no objection to research on this, only to doing in exclusively. Imagine if seven years ago there had been a push for electric or hybrid from the government. Detroit might not have been so far behind.
There is definitely going to be a chicken/egg problem with hydrogen. Who is going to build an expensive infrastructure if there are few cars to use it, and who is going to buy hydrogen powered cars without the infrastructure? I think it is going to require heavy government intervention, either from buying a hydrogen fleet for government use or for big tax breaks for building infrastructure. Classic case of free market at work.
The mechanics of it all may be simple. It is the scale and expense. It is not cheap for a station owner to buy a huge tank, have a big hole dug to drop it in and add the necessary pumps (I wonder of the hydrogen storage tanks are more expensive…I expect they would have to be a good deal more high-tech than a gasoline tank).
Now multiply that times 20,000 or more stations across the US. And as noted why would station owners want to absorb that cost when no one is driving hydrogen cars?
Now add to that hydrogen production. Somebody needs to build plants sufficient to supply all our hydrogen needs.
Probably need new kinds of hydrogen transport trucks as well. They have them today of course but you’ll need a lot more.
Now add that making hydrogen needs oodles of electricity. Will we need more powerplants of one sort or another?
Well to be fair to McCain, he has proposed a large expansion of nuclear power production, which will likely be a necessary step to lay groundwork for either a hydrogen economy or large-scale use of electric vehicles.
Power plants (barring renewable forms like hydro or solar) generate electricity by boiling water.
Sounds like you backed off a step and it may be more efficient but still in the water boiling business.
Which also brings into question if there is enough natural gas to run a hydrogen economy? You’d have to increase the mining of natural gas to meet the increased demand. With that factored in is it still cheaper to build all that and cart it around than it is to use electrolysis to get it from water? (I really don’t know)
