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The Daily Beast

 

Both Candidates Push Myth of Energy Independence

November 01, 2012

By Robert Bryce

Both candidates push the zombie notion that an energy-independent U.S. can insulate itself from global disruptions.

Ugh. It’s back. Politicians and pundits on both the left and the right are once again buzzing with the most hackneyed phrase in modern American politics: energy independence.

The phrase reared its ugly head in the first (three times), second (four times), and third (once) presidential debates, with each mention coming from Mitt Romney. Romney has taken to promoting "North American" energy independence as part of his five-point plan.

But Romney is not alone. President Obama and his allies have frequently used the phrase in an effort to show that the Democrats love oil and natural gas almost as much as the Republicans do. Indeed, the president’s website prominently touts his "approach to energy independence."

Don’t get me wrong. Surging U.S. oil and natural gas production is fantastic news on numerous fronts—reducing the trade deficit, creating jobs, and bringing in government tax and royalty revenues. But the entire concept of energy independence is a foolish notion. The idea that the U.S., the world’s biggest energy producer, and biggest energy consumer, should somehow be independent of the world’s biggest market, the global energy trade, is ludicrous on its face. Nevertheless, every president since Richard Nixon has promoted the phrase, and each one has promised that the goal of independence could be achieved in just a few short years. It hasn’t happened. And it won’t.

I could provide chapter and verse as to the silliness of energy independence. (In fact, four years ago, I wrote a book on the topic, Gusher of Lies: The Dangerous Delusions of Energy Independence). But given that the last presidential debate focused on foreign policy, let’s just look at that aspect.

Before doing so, however, let me briefly explain how two technologies—long-reach horizontal drilling and hydraulic fracturing—have allowed American drillers to unlock gargantuan quantities of oil and gas. In traditional oil and gas wells, drillers use a vertical bore hole. With horizontal drilling, drillers begin with a vertical bore, then turn the drill bit at a 90 degree angle and proceed out from there for as much as 3,000 meters. That horizontal segment allows the well to have far greater exposure to the hydrocarbon reservoir. Once that horizontal segment is drilled, drillers rely on hydraulic fracturing to unlock oil and gas from rock formations that were previously thought to be uneconomic. Fracturing uses powerful high-pressure pumps (12,000 horsepower or more) to pump water, sand, and tiny amounts of chemicals (usually surfactants and biocides) to crack the shale or other rock formation.

The combination of those technologies has resulted in record amounts of natural gas production. In 2011, U.S. gas production hit an all-time record, more than 23 trillion cubic feet.

Oil production is also soaring. Last year, production was 7.8 million barrels per day, the highest level since 1998. And Bentek Energy, an energy analytics firm, expects U.S. oil production could hit 12 million barrels per day by 2022. At that level, the U.S. would be producing more oil than either Russia or Saudi Arabia. Add in America’s abundant coal resources—which total the equivalent of some 900 billion barrels of oil—and it becomes apparent that the U.S. may soon emerge as the hydrocarbon exporter of choice. (My colleague at the Manhattan Institute, Mark Mills, recently wrote a report on this topic.)

These surging oil and gas production numbers have led a number of people, including T. Boone Pickens and others, to claim that once the U.S. is self-sufficient in oil, it will no longer have to import oil from the Middle East. That may, or may not, be true. But it doesn’t really matter. Oil is a fungible commodity. Its price is set on the world market. The oil that we don’t buy from the Saudis or Kuwaitis or Iraqis will be sold to someone else.

So what will increased energy production in the U.S., Canada, and Mexico mean for U.S. foreign policy? The short answer: not much.

For decades, the U.S. has maintained a major presence in the Middle East and the Persian Gulf. That presence has been predicated on the belief that the U.S. cannot allow other countries to stop the flow of oil out of the Strait of Hormuz. Sure, other countries, particularly American allies in Western Europe as well as Japan, should be shouldering more of the burden of keeping the Strait of Hormuz safe and navigable at all times. But it is inconceivable that the U.S. would withdraw from the Persian Gulf.

Ugh. It’s back. Politicians and pundits on both the left and the right are once again buzzing with the most hackneyed phrase in modern American politics: energy independence.

The phrase reared its ugly head in the first (three times), second (four times), and third (once) presidential debates, with each mention coming from Mitt Romney. Romney has taken to promoting "North American" energy independence as part of his five-point plan.

But Romney is not alone. President Obama and his allies have frequently used the phrase in an effort to show that the Democrats love oil and natural gas almost as much as the Republicans do. Indeed, the president’s website prominently touts his "approach to energy independence."

Don’t get me wrong. Surging U.S. oil and natural gas production is fantastic news on numerous fronts—reducing the trade deficit, creating jobs, and bringing in government tax and royalty revenues. But the entire concept of energy independence is a foolish notion. The idea that the U.S., the world’s biggest energy producer, and biggest energy consumer, should somehow be independent of the world’s biggest market, the global energy trade, is ludicrous on its face. Nevertheless, every president since Richard Nixon has promoted the phrase, and each one has promised that the goal of independence could be achieved in just a few short years. It hasn’t happened. And it won’t.

I could provide chapter and verse as to the silliness of energy independence. (In fact, four years ago, I wrote a book on the topic, Gusher of Lies: The Dangerous Delusions of Energy Independence). But given that the last presidential debate focused on foreign policy, let’s just look at that aspect.

Before doing so, however, let me briefly explain how two technologies—long-reach horizontal drilling and hydraulic fracturing—have allowed American drillers to unlock gargantuan quantities of oil and gas. In traditional oil and gas wells, drillers use a vertical bore hole. With horizontal drilling, drillers begin with a vertical bore, then turn the drill bit at a 90 degree angle and proceed out from there for as much as 3,000 meters. That horizontal segment allows the well to have far greater exposure to the hydrocarbon reservoir. Once that horizontal segment is drilled, drillers rely on hydraulic fracturing to unlock oil and gas from rock formations that were previously thought to be uneconomic. Fracturing uses powerful high-pressure pumps (12,000 horsepower or more) to pump water, sand, and tiny amounts of chemicals (usually surfactants and biocides) to crack the shale or other rock formation.

The combination of those technologies has resulted in record amounts of natural gas production. In 2011, U.S. gas production hit an all-time record, more than 23 trillion cubic feet.

Oil production is also soaring. Last year, production was 7.8 million barrels per day, the highest level since 1998. And Bentek Energy, an energy analytics firm, expects U.S. oil production could hit 12 million barrels per day by 2022. At that level, the U.S. would be producing more oil than either Russia or Saudi Arabia. Add in America’s abundant coal resources—which total the equivalent of some 900 billion barrels of oil—and it becomes apparent that the U.S. may soon emerge as the hydrocarbon exporter of choice. (My colleague at the Manhattan Institute, Mark Mills, recently wrote a report on this topic.)

These surging oil and gas production numbers have led a number of people, including T. Boone Pickens and others, to claim that once the U.S. is self-sufficient in oil, it will no longer have to import oil from the Middle East. That may, or may not, be true. But it doesn’t really matter. Oil is a fungible commodity. Its price is set on the world market. The oil that we don’t buy from the Saudis or Kuwaitis or Iraqis will be sold to someone else.

So what will increased energy production in the U.S., Canada, and Mexico mean for U.S. foreign policy? The short answer: not much.

For decades, the U.S. has maintained a major presence in the Middle East and the Persian Gulf. That presence has been predicated on the belief that the U.S. cannot allow other countries to stop the flow of oil out of the Strait of Hormuz. Sure, other countries, particularly American allies in Western Europe as well as Japan, should be shouldering more of the burden of keeping the Strait of Hormuz safe and navigable at all times. But it is inconceivable that the U.S. would withdraw from the Persian Gulf.

Original Source: http://www.thedailybeast.com/articles/2012/11/01/both-candidates-push-myth-of-energy-independence.html

 

 
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