Posted by mb50
President Barack Obama’s administration has claimed a number of remarkable accomplishments that will reduce dependence upon foreign oil and secure future energy security. Statements leading up to and during his January 24 State of the Union address take credit for highest levels of natural gas production in more than 30 years, record oil production in eight years, reduction of oil imports by an average of 1.1 million barrels per day, and making the U.S. a net energy exporter.
To hear him tell it, these achievements, to the extent they really exist, are appropriately attributable to his foresight and actions, rather to than to an entrepreneurial energy industry. Speaking at a January 17 meeting of his Jobs and Competitive Council he complained about lack of recognition of this fact, stating, “Folks are acting as if that [natural gas boon] just sprung out of thin air and is one more example of the dynamism of the marketplace.” Yup, under his leadership, government did it.
Furthermore, his masterworks have but only begun. Next he will open up 75% of our potential offshore oil and gas resources for development, and approve enough renewable energy projects on federal land to power three million homes.
Of course there is obviously a small catch. He will need a little more time, another four years beyond this one, to really solve everything. But before we cast those 2012 ballots to allow that to happen, let’s review the veracity of his many claims thanks to lots of fact checking help from the Institute for Energy Research (EIR) and Politifact.com.
First, he’s right about natural gas production being at record high levels and oil up very slightly, but he apparently forgot to mention that is occurring on private and state-owned lands, not on federal lands that presidents have control over.In fact the U.S. Energy Information Administration (EIA) has reported that both natural gas and oil production have declined on federal lands since the beginning of the Obama administration.
As for domestic oil, it is also true that production has reached slightly highest levels since 2003, but yields on federal lands have fallen 43% over the past 9 years, and have done so most rapidly under Obama’s watch. While total levels have been quite stable, EIA’s estimated production for 2012 is only about 13% higher than for the lowest year over an eight-year period (about 2,055,646,000 barrels, compared with 2,073,453,000 barrels in 2003). In January 2009 when President Obama was inaugurated, the U.S. produced 5,154,000 barrels of oil per day. By November 2011 (the last month for data), the U.S. was producing 5,874,000 barrels per day.This 700,000 increase occurred once again on private and state lands. Not only is the Obama administration making it more difficult to produce energy on federal lands, his minions are also leasing out less lands than in the past. Due to actions that limit offshore areas where oil can be produced and cancel other leases, production on federal lands will most likely continue to fall. Yet fortunately, the most recent EIA “Short-Term Energy Outlook” published in January forecasts increases in total crude oil production in 2012 and 2013 thanks to increases in onshore production in the lower 48, which overshadows decreases in Alaska and the Gulf of Mexico.
Has the president, as he bragged, caused the amount of oil we are importing to be reduced? Very likely, the answer is a clear “yes”. More than half of this reduction is because of the ongoing recession along with much higher fuel prices which have caused consumers to drive less. But has the U.S., as Obama stated, become a net energy exporter? He didn’t provide any information source to back up that claim, and it contradicts EIA data that shows this to be far off the reality mark. In 2010 the U.S. imported 21 quadrillion of the 98 quadrillion Btus of energy used.
And what about that bold new proposal to make more than 75% of undiscovered oil and gas resources off our shores available for development, while putting in place common-sense safety requirements to prevent a disaster like the BP oil spill from happening again? For historical perspective, let’s remember that when Obama was elected, nearly 100% of the offshore areas were available for exploration and development. Since then his administration has imposed severe limitations. One case in point is that despite bi-partisan support from the Virginia delegation, including Democratic senators, exploration off Virginia’s coast has been prohibited.
Do you happen to remember when the Obama administration imposed a nearly year-long deep water drilling moratorium following the BP oil spill that blocked U.S. access to an estimated 7.5 billion barrels of oil and nearly 60 trillion cubic feet of natural gas? And when that very same administration also invested more than $2 billion in trade credits with Brazil’s state-owned oil company Petrobras to finance offshore exploration in their Tupi oil field in the Santos Basin near Rio de Janeiro? (Investor’s Business Daily has recently reported that an Ex-Im bank source informed them that the amount could go way higher, “in the neighborhood of $20 billion”.) Do you happen to recall that March 19, 2010 White House press conference when the president pledged that America would become one of their best customers?
Well, it seems they got a better offer. Ten months later Brazil snubbed Obama’s generosity with our money and opted to sell its oil to another country. China bought up a 40% stake in Repsol-YPF’s Brazil unit which has dibs on drilling in the offshore Santos Basin where the biggest deepwater discoveries are occurring, along with a 30% stake in Galp Energia, a Portuguese company that has also acquired rights there. Meanwhile, some of those embargoed out-of-business deep water rigs we had planned to use sailed off into the sunset to Brazil.
Having been jilted by Brazil, one might imagine that the president might be more appreciative of our neighbor to the north. Yet shortly before his State of the Union address he single-handedly rejected issuing a Keystone XL pipeline permit that does great injury to Canada as well as to American energy consumers, businesses and job opportunities. A scant one month earlier his administration imposed onerous regulations on the American economy through EPA standards that will have little or no measurable effect on health from targeted emissions.
While extolling virtues of natural gas and cheering his administration’s accomplishments, the president continues to call for higher taxes and restrictions on those industries we depend upon to produce it. Included are proposed windfall profit taxes, use-it or lose-it land fees, and agency foot-dragging on leases awaiting federal permits. At the same time, he stumps unrelentingly for taxpayer handouts and other special benefits for Solyndra-style green energy companies that can’t compete in free markets, and most likely, never will.
This is a president who promoted alarmism about a scarcity of American oil resources, mistakenly declaring in June 2010 that “We consume more than 20% of the world’s oil, but have less than 2% of the world’s oil reserves.” In reality, the Institute for Energy Research founded by fellow Forbes contributor Robert Bradley has reported, based upon government data, that North America land areas contain twice the combined proven reserves of all OPEC nations, and enough natural gas to provide for America’s electricity needs at current usage rates for the more than 500 years.
A continuation of current White House agendas will only ensure that the administration’s energy scarcity narrative is realized. Moreover, as IER President Thomas Pile observes , “If the state of the union is actually stronger, it comes despite the policies of President Obama and not because of them.”
- Natural gas sector set up by Obama to be sabotaged? (mb50.wordpress.com)
- Obama’s Words Don’t Match with Action on Oil and Gas (mb50.wordpress.com)
- Obama loves oil – Not! (mb50.wordpress.com)
- Is President Barack Obama responsible for U.S. oil production rise? (mb50.wordpress.com)
- President Barack Obama will announce natural gas initiatives (newsok.com)
Tags: Barack Obama, BarackObama, energy, Energy Information Administration, Institute for Energy Research, Larry Bell, Obama, Obama administration, politifact, President Obama, renewable energy projects, Santos Basin, security statements, State Of Delusion, State of the Union address, u s energy