from http://www.washingtonpost.com/wp-dyn/content/article/2008/07/13/AR2008071302052_pf.html
By Steven MufsonWashington Post Staff WriterMonday, July 14, 2008; A01
On Jan. 28, 1969, a blowout on a Unocal rig six miles off the coast of California spilled 3 million gallons of oil into the waters off Santa Barbara. The blackened beaches and oil-soaked birds and seals became icons for the environmental movement and eventually brought oil exploration off the Atlantic and Pacific coasts of the United States to a halt.
Now, President Bush, Republicans in Congress and big oil companies want to reopen those waters to oil and gas exploration. In his radio address Saturday, Bush said that "technological advances have allowed us to explore oil offshore in ways that protect the environment" and that outer continental shelf areas now off limits "could produce enough oil to match America's current production for almost 10 years."
The issue has become a dividing line for the presidential candidates. Sen. John McCain (R-Ariz.) reversed his position last month and endorsed expanded offshore drilling, while Sen. Barack Obama (D-Ill.) wants to maintain the moratorium on offshore drilling, which he says would do nothing to immediately lower gasoline prices. In the past week, congressional Republicans have issued a blizzard of statements pushing for action before summer recess, and some Democrats may be leaning their way.
Polls show that Americans, pressed by high gasoline prices, may be open to offshore drilling. In a May Gallup poll, 57 percent of people surveyed were willing to allow drilling in coastal and wilderness areas currently off limits, if it had the potential to reduce high gas prices.
But prying open U.S. waters for oil and gas drilling remains a daunting political task. Real estate developers and tourism industries oppose drilling offshore. Environmentalists are battling against it. Most Democrats in Congress oppose it, too. And for years, Florida politicians, including the president's brother, former Florida governor Jeb Bush (R), have fought against drilling.
Two years ago, a massive drive to expand offshore drilling ended with a compromise that opened an additional 8.3-million-acre area in the Gulf of Mexico known as Lease 181 and gave a chunk of the federal revenue to state governments.
Senate Minority Leader Mitch McConnell (R-Ky.) has introduced an energy bill with 43 Republican co-sponsors that would, among other things, open up the outer continental shelf starting 50 miles from shore for oil and gas exploration. McConnell says 85 percent of the outer continental shelf is currently off limits.
Although the drilling would be in federal waters, state governments would have to give approval for exploration and production off their shores. McConnell's legislation would give states an incentive to allow drilling by giving them a 37.5 percent share of federal royalties.
Republicans have tried to link offshore drilling to the surge in gasoline prices.
"The American people are saying loud and clear -- there is no ambiguity about it -- they want us to do something about it, and they understand the laws of supply and demand," McConnell said last week. He said he was negotiating with Senate Majority Leader Harry M. Reid (Nev.) in an effort to find common ground.
Top Senate Democrats this week said compromise was possible, but House Majority Leader Steny H. Hoyer (D-Md.) issued a release saying that there are already 68 million acres of public lands and waters open for drilling. The area is equal, he said, to Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island, New York, New Jersey, Delaware and about two-thirds of Maryland, combined.
The debate over offshore drilling has been muddied by a variety of claims about how much oil and gas might lie under the sea, what it would take to get hold of it and what the impact would be.
McCain told reporters last month that "we have untapped oil reserves of at least 21 billion barrels in the United States." In fact, the U.S. Geological Survey estimates that there are "undiscovered conventionally recoverable resources" of 17.8 billion barrels. That's not the same thing as "reserves." In the oil business, "reserves" refers to oil that has been found and "proven," whereas "resources" refers to promising geological structures where the presence of oil remains uncertain.
In the eastern Gulf of Mexico, those "resources" are likely to represent actual oil because the geology is an extension of the western Gulf of Mexico, where oil has been drilled for years. There is less certainty about what may lie off the Atlantic coast.
If, in fact, there are 17.8 billion barrels of oil offshore, that would equal half the reserves of Nigeria or about 60 percent of proven U.S. reserves. It could substantially reduce U.S. imports for a decade or two or sustain U.S. production when other fields decline.
But developing those resources would take time. A report last year by the Energy Department's Energy Information Administration said that "access to the Pacific, Atlantic, and eastern Gulf regions would not have a significant impact on domestic crude oil and natural gas production or prices before 2030. Leasing would begin no sooner than 2012, and production would not be expected to start before 2017." It added, "Because oil prices are determined on the international market, however, any impact on average wellhead prices is expected to be insignificant."
Drilling proponents say that drilling today is much more sophisticated than it was in 1969. Oil companies and their supporters boast about how their platforms and pipelines withstood the hurricanes of 2005. "I think people are reassured that not a drop of oil was spilled during Katrina or Rita," McConnell said. "Those rigs in the Gulf, there was not a single incident of spillage that anyone reported."
Although the overwhelming majority of safety valves did in fact work during the hurricanes, the Minerals Management Service of the Interior Department reported that there were five spills, each between 1,000 and 2,000 barrels. Altogether, 125 small spills totaled 16,302 barrels, almost a quarter as big as the Santa Barbara spill. (The MMS says that over the past 20 years, less than 0.001 percent of oil produced in U.S. waters has been spilled.)
Foes of offshore drilling argue that the oil industry isn't taking advantage of lease areas already available on federal lands and waters. Democratic Sens. Russ Feingold (Wis.), Christopher J. Dodd (Conn.) and Robert Menendez (N.J.) have introduced "use it or lose it" legislation.
"For years, oil companies have been sitting on millions of acres -- doing nothing to develop them for drilling -- while hardworking Americans grapple with skyrocketing prices at the pump," Dodd said in a statement.
But oil companies say they need time to line up rigs and crews. G.L. Kirkland, head of exploration and production at Chevron, said that 498 of Chevron's 796 leases are considered "undeveloped," but that plans for drilling are moving ahead. He noted that oil companies pay rent to the federal government on undeveloped leases and lose undeveloped leases after 10 years.
Many oil companies and Bush administration officials say that it is hypocritical to pressure other countries to open new exploration areas, especially offshore, when the United States refuses to drill in its own waters. Indeed, many of the world's hottest oil prospects are off the shores of West Africa, Thailand, Australia, Brazil, the Persian Gulf and the Arctic Circle.
(I have bolded some of the facts that seem to be getting lost in the more emotional discussions on this- Voltaire)
Once again illustratating Bush's complete subservience to the oil industry, without regard for the benefit of the country, its security or its people. Wake me up when it's 2009.
This comment has been crossposted at AT&T: 611 Folsom Street, San Francisco, CA -- Room 641A.
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Wow, a bunch of Democrap hot air. Dodd is either uninformed of lying. After watching him and the Dem dog and pony show on thursday, I say he is lying.
Far more oil naturally seeps from the ocean floor than has ever been spilled.
And the Cali spill was 40 years ago, I guess technology has stood still since then.
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cjheap: Wow, a bunch of Democrap hot air. Dodd is either uninformed of lying. After watching him and the Dem dog and pony show on thursday, I say he is lying. Far more oil naturally seeps from the ocean floor than has ever been spilled. And the Cali spill was 40 years ago, I guess technology has stood still since then.
Technology has nothing to do with the damages if a spill occurs. It also has not reduced the risks by much given the present evidence.
The line about oil seeping into the ocean naturally in such quantities is bullcrap.
Dodd is not saying this on his own. His statements are based on
The U.S. Geological Survey, The Department's Energy Information Administration, and
the Minerals Management Service of the Interior Department
Are they all "Democrap hot air"?
Once again I'm feeling aligned with McCain. When our economy was strong and people were paying $2.00 a gallon or less for fuel, I was all for restricting access to more offshore drilling and tapping our reserves in ANWR. But the economy and a large percentage of our citizens are struggling. I see it both in business and in families. Since few have the options to not drive, to heat and cool their homes or pay for items that require oil to produce and transport, we need energy. The only way to reverse this sudden rise to $4 and $5 gasoline is attack it on all fronts ... one of them is more petroleum (or the promise of more). Personally I can't imagine what it is going to cost to heat a home with fuel oil this winter?
More drilling is not the ultimate answer IMHO, but it is a piece of the energy equation that will get us out of this 'near' crisis ... let's not continue to wait and spend the next decade dealing mulling over the same issue. If there are immediate answers that will not take our nation to 3rd world standards and bypass the need for 'some' domestically produced petroleum, I'm all ears.
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Rich:Once again I'm feeling aligned with McCain. When our economy was strong and people were paying $2.00 a gallon or less for fuel, I was all for restricting access to more offshore drilling and tapping our reserves in ANWR. But the economy and a large percentage of our citizens are struggling. I see it both in business and in families. Since few have the options to not drive, to heat and cool their homes or pay for items that require oil to produce and transport, we need energy. The only way to reverse this sudden rise to $4 and $5 gasoline is attack it on all fronts ... one of them is more petroleum (or the promise of more). Personally I can't imagine what it is going to cost to heat a home with fuel oil this winter? More drilling is not the ultimate answer IMHO, but it is a piece of the energy equation that will get us out of this 'near' crisis ... let's not continue to wait and spend the next decade dealing mulling over the same issue. If there are immediate answers that will not take our nation to 3rd world standards and bypass the need for 'some' domestically produced petroleum, I'm all ears.
The problem is that DHDNPL is !NOT! going to lower prices.
Not in the near term. Not in the long term. Not ever. Certainly not by winter 2008-2009
DHDNPL is simply a bad idea. It is political pondering in the worst sense. It won't help. It certainly won't help during this economic cycle or this winter.
Worse, it takes the focus off things that we could do that actually =would= reduce petroleum prices by winter 2008-2009.
But not by much. =Nothing= less than a worldwide recession or depression is going to drop prices below ~$100 US pb.
...and that's the bitter truth the politicians are trying to avoid saying.
Things we can do that will work in the short term.
Strengthen the US dollar by a= increasing the Federal Funds Rate, and b= showing that the US is taking serious steps to reduce the US national debt.
Pricing crude oil in Chinese yuen rather than US dollars will help since that will dampen the use of crude futures as hedges against a weak US dollar.
Regulation to minimize the volatility of crude futures market will also help.
All these can be done qiuckly and for far less money than DHDNPL.
However, they will have no more than a modest effect on crude oil prices. If you are looking for prices to go back to $80 US pb or less, you are out of luck unless either
a= the global economy collapses (a cure worse than the disease IMHO), or
b= the 5 largest non-OECD countries (China, India, the ME) suddenly start using less petroleum
I quote http://www.eia.doe.gov/steo
" Consumption. World oil consumption continues to grow despite 7 consecutive years of rising prices. Preliminary data indicate that world oil consumption during the first half of 2008 rose by roughly 520,000 bbl/d compared with year-earlier levels. Compared to year-ago levels, this increase reflects a 170,000-bbl/d gain in the first quarter, followed by an 870,000-bbl/d increase in the second quarter. A 760,000-bbl/d decline in consumption in OECD countries during the first half of 2008, mainly concentrated in the United States, was more than offset by a 1.3-million-bbl/d increase in consumption in non-OECD nations led by China and the Middle East (World Oil Consumption). World oil consumption is projected to rise by (only) almost 1.2 million bbl/d during the second half of the year, reflecting the impact of higher expected prices, lower economic growth, and growing pressure in some countries (such as India, Malaysia, Indonesia, and China) to ease price subsidies, which could dampen consumption growth."
Well Voltaire thankfully you are not in charge of anything other than Hot air Just the threat of off shore drilling has caused about a 12% pullback this week alone. I know that scares the Hell out of you. The country is watching and about 66% want to open up off shore drilling. So spew all you want, you are a minority and it is going to happen.
Dereck
dereckbc:Well Voltaire thankfully you are not in charge of anything other than Hot air Just the threat of off shore drilling has caused about a 12% pullback this week alone. I know that scares the Hell out of you. The country is watching and about 66% want to open up off shore drilling. So spew all you want, you are a minority and it is going to happen.
You are confused. What is causing the drop in crude prices is
1= de-escalation in tensions regarding Iran and
2= most important,
a= a ~2% drop in US petroleum demand compared to this time last year.
b= China and the other non-OECD countries starting to raise their domestic retail prices for petroleum
c= an expectation that the world economy is slowing down and that global demand is not going to be as large as originally projected for 2008.
IOW, real changes or expected changes in the short term supply demand equation.
The news is filled with this stuff. The government sites are filled with this stuff. There is no way you can claim it is not real or does not exist.
For a believer in the free market, the effect on prices of decreasing demand should be obvious.
Voltaire: cjheap: Wow, a bunch of Democrap hot air. Dodd is either uninformed of lying. After watching him and the Dem dog and pony show on thursday, I say he is lying. Far more oil naturally seeps from the ocean floor than has ever been spilled. And the Cali spill was 40 years ago, I guess technology has stood still since then. Technology has nothing to do with the damages if a spill occurs. It also has not reduced the risks by much given the present evidence. The line about oil seeping into the ocean naturally in such quantities is bullcrap. Dodd is not saying this on his own. His statements are based on The U.S. Geological Survey, The Department's Energy Information Administration, and the Minerals Management Service of the Interior Department Are they all "Democrap hot air"?
LMAO, you really need to look up the government reports showing the amount of accidental spills across history and get back to us. You do not know much about the O&G industry judging by your posts.
Post evidence to refute the conclusions, or evidence that will refute the data. Or even evidence that will refute the sources (after all, our taxes are paying for those sources to be accurate).
But please stop the Ad Hominem attacks and Trolling.
cj, at least Voltaire posts links to back up his assertions. Unfortunately, your primary method of debate is just to mock your opponent and simply discount his ideas without actually posting reasoning behind it other than "It's America hating" or "Democratic *insert expletive here*".
It's unfortunate, because I think you have legitimate things to say.
Voltaire: Post evidence to refute the conclusions, or evidence that will refute the data. Or even evidence that will refute the sources (after all, our taxes are paying for those sources to be accurate). But please stop the Ad Hominem attacks and Trolling.
Look it up , it is not hard to find. Your regurgitating of Dem leaders talking points is not posting facts so I will not waste my time with any more than to call them and you on it.
Here is a nice little report with color pics and charts that are easy to follow http://www.mms.gov/stats/PDFs/2002OilSpillFacts.pdf
Why don't you stop your trolling with these inaccurate talking points and outright lies?
There has been a lot of name calling in this thread, but no substantial attempt at rebuttal of the points in the initial post, other than the issue of oil spills. HOw about the fact that the >20 billion barrels of proven oil reserves claim made is complete hogwash? How about the fact that it would take many years to actually *find* oil in places where it is *suspected* of being, and more years to develop those fields - such that contrary to the claims of McCain and others, it would have no near-term impact on oil prices?
Or is the rebuttal for that just calling it "hot air"?
Mike Briggs: There has been a lot of name calling in this thread, but no substantial attempt at rebuttal of the points in the initial post, other than the issue of oil spills. HOw about the fact that the >20 billion barrels of proven oil reserves claim made is complete hogwash? How about the fact that it would take many years to actually *find* oil in places where it is *suspected* of being, and more years to develop those fields - such that contrary to the claims of McCain and others, it would have no near-term impact on oil prices?
The sooner we start drilling the better.
SmokeStack:I totally agree drilling these new areas will not have a short term effect on prices. However, given that the oil will likely take a decade or more to come on stream, and world demand is exploding while supply global supply is stagnated/decreasing, that 'small' amount of offshore and arctic oil will be much more important in 15 years than it is today. The sooner we start drilling the better.
I support and promote alternatives to petroleum just like most folks here ... and even have a 'green' streak running somewhere deep in my veins ... but I agree that we need to look at all areas of energy which includes responsible exploration and drilling for new oil. I also agree that there all the little 'fix' ideas (ie. fuel tax holiday) that are designed to lower the pump price a few cents are not really answers, but doing something is better than doing nothing, complaining and continually debating that oil is bad or even placing blame on previous politicians for their lack of foresight. What we do need to do is to look a few years ahead and make a comprehensive plan to prevent a long term economic meltdown and prevent energy price that are rippling through our economy. Drilling will be part of that plan even if its not to a minority of green thinkers liking.
Let's focus on responsible use of 'some' ANWR area, new off-shore domestic drilling and use of existing leases that the Dems are tell us have yet to be explored.
SmokeStack: The sooner we start drilling the better.
Sure - if you assume that all of us scientists who think increasing atmospheric carbon will increase the average temperature on earth, which will have some quite negative impacts.
Additionally, since other options - in particular PHEVs and pure EVs should be commercially available and viable well before that oil comes online - why bother?