Remember When We Were Protected from Oil Price Increases Because We Were Basically Petroleum Energy Independent?

Reuters headline Saudi Arabia, Russia deepen oil cuts, sending prices higher

Saudi Arabia and Russia, the world's biggest oil exporters, deepened oil cuts on Monday, sending prices higher despite concerns over a global economic slowdown and possible further interest rate increases from the U.S. Federal Reserve.

Oh. gosh, was it only a few years ago that the US was mostly petroleum independent? Well, Reuters has an article that declares that the US was not really energy independent, because, well, it depends on how you define "independence"

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For Andrew Campbell, Executive Director of the Energy Institute at Berkeley Haas ( here ) “energy independence” is a “political slogan, not an economic or technical concept with a clear definition” often used by politicians to “imply that a country is insulated from global energy markets”.

“This is rarely the case,” he said.

“If a country produces all of the energy that it consumes, does not participate in international trade in energy, does not import energy-intensive products and does not send energy-related pollution to its neighbors or the atmosphere, then I would consider it energy independent. I don’t think any country meets that definition.”

Harrison Fell, a Senior Research Scholar at the Center on Global Energy Policy at Columbia University SIPA ( here ) said “energy independence is a tricky concept” and said it was often quantified by comparing energy production to energy consumption, but cautioned that the implications of this may be misunderstood.

So, we pass laws making it virtually impossible to build new refineries, which means we ship crude offshore to be refined, and that means we can't ever be energy independent?

Reuters also reports the EPA is screwing around small refiners by denying exemptions from a ridiculous law, which means lower output of gasoline and other products - which will raise the price of gasoline to consumers U.S. EPA denies nearly all biofuel blending exemption petitions

President Joe Biden's administration on Friday denied almost all outstanding petitions from oil refiners asking to be exempted from mandates that require them to mix biofuels into their fuel.

The Environmental Protection Agency (EPA), which has the authority to issue the exemptions, denied 26 petitions from 15 small refineries who applied for waivers for the 2016-2018 and 2021-2023 compliance years, the agency said on Friday. There are still two pending petitions.

The agency also disclosed which oil refiners submitted petitions in July 2022 or later, as well as which oil refiners are participating in an alternative compliance schedule that allows them flexibility in complying with biofuel blending laws.

Under the Renewable Fuel Standard (RFS), oil refiners must blend billions of gallons of biofuels into the nation's fuel mix, or buy tradable credits from those that do. The EPA can, however, award exemptions to some small refiners if they prove that the obligations cause them undue harm.

I keep being reminded of the old Walt Kelly comic in which Pogo announces who is responsible for problems, which when it appeared in 1971, was directed at the problem of pollution. Now we find the "cure"- when carried too far - is no piece of cake either. Moderation in all things.

Ukraine and CDR Salamander's Comments

Better that you read this than any of my meanderings Second Russo-Ukraine War D+0 Quicklook

Remember, the Russians hold the Presidency of the UN Security Council. The UN is a joke. OSCE is a joke. The EU is little more than a nest of rent-seeking, clock-watching grift-fest. NATO is, well, dysfunctional but better than nothing. Nations must take ownership of their own security. Yes, Taiwan and Japan I am talking to you. Study history. Be ready.

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Is everyone clear what Russia is now? She has a small GDP and apocalyptic demographics, but she is taking what she has and is invading her neighbors, killing people, and taking land. If your nation, company, or neighbor is buying anything from them – they are paying for this military adventurism. If the press wants to do its job, start pulling that string.

The U.S. needs to restart its energy independence efforts and reverse the course of what the current administration has done so that we can offer Europe energy security and cut the flow of energy dollors and Euros to the thugs in Moscowland.

As Mao said, "Political power grows out of the barrel of a gun." Putin is seeking political power, not only over Ukraine, but over Western Europe. His approach is not subtle diplomacy.

"No War for Oil" Needed - Thanks to Fracking

For years here, I have been praising the concept of energy independence for the United States (see, e.g. Energy Wars: Fracking Our Way Ahead):

It's interesting that people who have previously argued that we should not fight "wars for oil" in our own national interest are willing (1) to commit our national forces and dollars to possibly fighting "wars for oil" for the interests of other countries and (2) that people who who are opposed to U.S. fracking on environmental grounds seem to be totally okay with the status quo of pushing environmental damage off to those second and third world countries who are resource rich but not in the protesters back yards - and condemning others in the world to be dependent on the whims of leaders in Russia and other undemocratic countries.
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It also behooves Europe and Japan that the U.S., Canada and Mexico develop LNG export facilities to allow the export of natural gas to offset the Russian and Iranian power in using the "oil and gas weapon" against Europe.

The U.S. government should be encouraging U.S. companies to help Poland to explore its shale gas reserves as an offset to the Russians. While the estimated levels of Polish shale gas are fluctuating, there is gas there and it is both Polish and European interests to develop it.

It's not just the U.S. that has the potential to be "sitting pretty" as a result of the the shale boom.

You don't want to fight Iran for attacking Saudi Arabia?

Fine, continue to use the our oil and gas production to continue to inflict economic damage on the Iranians - our crude and NG is perfectly fungible for what Iran produces. The world will little note nor long remember what Iran and its surrogates are trying to do by disrupting the energy flow from the Arabian Gulf. Iran has gone to this well before, but this time the world has moved on from total reliance on Middle East oil and gas. The U.S. can be entirely energy independent of the Middle East.

In fact, it occurs to me that without the infusion of cash from the Obama Administration's Joint Comprehensive Plan of Action (JCPOA) deal with Iran, Iran would be soon be running on empty.

It is also worth noting that due to the wonders of its socialist dictatorship, Venezuela's oil production is not really a factor in the world market right now. If that situation could be reversed, the importance of Middle East energy supplies diminishes even further.

We just need to ride this out.

Oh, and build more nuclear power plants.

In the meantime, it seems demand for product is on a downward trend:

Not a Bad Idea: Trump tells other countries to protect own Gulf shipping

Trump tells other countries to protect own Gulf shipping

President Donald Trump on Monday told other countries to protect their own Gulf oil shipments, declaring that the United States has only limited strategic interest in the "dangerous" region.

In a pair of tweets, Trump said US aims regarding Iran boil down to "No Nuclear Weapons and No Further Sponsoring of Terror."

Stating that the United States is now the world's biggest energy producer, thereby weaning itself off decades of dependence on Middle Eastern oil, Trump said "we don't even need to be there."

And the US military should not be depended upon to keep the narrow sea routes along Iran's coast free.

"Why are we protecting the shipping lanes for other countries (many years) for zero compensation," he asked. "All of these countries should be protecting their own ships on what has always been a dangerous journey."

As for Tehran, Trump said, his only demand is that the country not pursue nuclear weapons and halts what the United States claims is backing for terrorist groups.

"The U.S. request for Iran is very simple," he wrote.
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Trump's tweets add to his record of seeking a wider draw down of the US diplomatic and military footprint around the world.

Among the nations using oil from the Arabian Gulf area the French and the Brits have shared some of the sea lines of communication protection load, but since 1980 the laboring oar has been the U.S. Navy - which today has more sailors serving in that region of the world than anywhere else.

With the U.S. now perfectly capable of being energy independent, the vital national interest invoked by President Carter in the Carter Doctrine is no more, which is precisely what President Trump stated in his Tweets.

The Iranians count on U.S. reluctance to take Iran directly on or to directly confront Iran's effort to incite trouble throughout the area and to stage its small potato aggravations such as limpet mining ships or shooting down an unarmed drone. It's the "just not worth it" problem the U.S. faces - the aggravation level  of Iran's puny activity doesn't rise to the level of an existential threat to the U.S. Under the Weinberger Doctrine,  unless it does, there is no reason to go to war:

The Weinberger doctrine:

1. The United States should not commit forces to combat unless the vital national interests of the United States or its allies are involved.
2. U.S. troops should only be committed wholeheartedly and with the clear intention of winning. Otherwise, troops should not be committed.
3. U.S. combat troops should be committed only with clearly defined political and military objectives and with the capacity to accomplish those objectives.
4. The relationship between the objectives and the size and composition of the forces committed should be continually reassessed and adjusted if necessary.
5. U.S. troops should not be committed to battle without a "reasonable assurance" of the support of U.S. public opinion and Congress.
6. The commitment of U.S. troops should be considered only as a last resort.

You might note that the "burr under the saddle" approach the Iranians follow never really crosses that line which would justify the U.S. completely destroying Iranian maritime forces of the Iranian Navy or its Iranian Revolutionary Guard or taking out the dictators who head Iran.

Critics of the Weinberger Doctrine might invoke the lessons set out in Colin Powell's December 1992 Foreign Affairs article U.S. Forces: Challenges Ahead
discussing the shift from a Cold War footing for the U.S. military to one based on dealing with "regional contingencies"

THE NEW NATIONAL military strategy is an unclassified document. Anyone can read it. It is short, to the point and unambiguous. The central idea in the strategy is the change from a focus on global war?fighting to a focus on regional contingencies. No communist hordes threaten western Europe today and, by extension, the rest of the free world. So our new strategy emphasizes being able to deal with individual crises without their escalating to global or thermonuclear war.

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To help with the complex issue of the use of "violent" force, some have turned to a set of principles or a when-to-go-to-war doctrine. "Follow these directions and you can’t go wrong." There is, however, no fixed set of rules for the use of military force. To set one up is dangerous. First, it destroys the ambiguity we might want to exist in our enemy’s mind regarding our intentions. Unless part of our strategy is to destroy that ambiguity, it is usually helpful to keep it intact.

Second, having a fixed set of rules for how you will go to war is like saying you are always going to use the elevator in the event of fire in your apartment building. Surely enough, when the fire comes the elevator will be engulfed in flames or, worse, it will look good when you get in it only to fill with smoke and flames and crash a few minutes later. But do you stay in your apartment and burn to death because your plan calls for using the elevator to escape and the elevator is untenable? No, you run to the stairs, an outside fire escape or a window. In short, your plans to escape should be governed by the circumstances of the fire when it starts.

When a "fire" starts that might require committing armed forces, we need to evaluate the circumstances. Relevant questions include: Is the political objective we seek to achieve important, clearly defined and understood? Have all other nonviolent policy means failed? Will military force achieve the objective? At what cost? Have the gains and risks been analyzed? How might the situation that we seek to alter, once it is altered by force, develop further and what might be the consequences?

As an example of this logical process, we can examine the assertions of those who have asked why President Bush did not order our forces on to Baghdad after we had driven the Iraqi army out of Kuwait. We must assume that the political objective of such an order would have been capturing Saddam Hussein. Even if Hussein had waited for us to enter Baghdad, and even if we had been able to capture him, what purpose would it have served? And would serving that purpose have been worth the many more casualties that would have occurred? Would it have been worth the inevitable follow?up: major occupation forces in Iraq for years to come and a very expensive and complex American proconsulship in Baghdad? Fortunately for America, reasonable people at the time thought not. They still do.

I left that last paragraph in as a reminder that even you are engaging in punitive strikes or limited wars there is always the potential of getting stuck in problems that are not yours to solve, as we now ought to know too well. You want unforeseen consequences? See the effects of the Somalia, Libya and Syria "humanitarian" interventions, though they were of limited scope.

Where's this leave the U.S.? The situation that caused President Carter to make up a doctrine for the Middle East has changed. The reality is that the U.S. has no "vital national interest" in the Arabian Gulf. Whether our "allies" do is unclear - if they do, they should be taking steps to protect them without depending on the U.S. taxpayers to provide that protection through its investment in its own military. We have other things and places to focus our attention on.

President Trump is correct in his statements about what we seek from Iran - no nukes (they threaten U.S. allies) and stop funding terrorism. If the Iranians want peace and security, they know what they have to do to get it.

The message for those who rely on oil shipped out of the Arabian Gulf? Grow up and look after your own interests. As Henry Kissinger said, “America has no permanent friends or enemies, only interests” The American interest in the waters off Iran is dwindling rapidly.

California's Power Problem, Paid for by the Rest of Us

So, there's some sort of "movement" afoot by some gaggle of Californians to secede from the rest of us not living in paradise. While this movement is largely political, it does raise some interesting questions about how the departed will deal some pressing issues, one of which is where it will get its power to run its cool high speed rail, not to mention businesses and homes and industries.

As noted in this Forbes piece from 2016,California's Growing Imported Electricity Problem

California now imports 33% of its electricity supply from fast growing neighbors, with about 65% of that coming from the Southwest and 35% coming from the Northwest. These numbers increase most in summer months when air conditioning loads peak. Imports have been rising rapidly: in 2010, California "only" imported 25% of its power.

Per the U.S. Energy Information Administration, California imports because "its wholesale power markets in the region are relatively open and generation from outside the state is often less expensive." In fact, California imports about 6% of its electricity from out-of-state coal-fired power plants, with another 14% coming from "unspecified imports," of a cloudy origin that is generally attributed to hydropower, gas, nuclear, and other renewables.

Well, now. California has shifted (at the cost to its citizens in high energy prices) some of the cost of energy production (pollution, etc) to other states. Again from the Forbes piece:

And as seen with the 2015 drought, where low water levels had hydro dams producing 80% less power than normal, future generation and imports of hydropower will be restricted by climate change worsening drought. This is very bad news for California's already precarious power market: hydropower plays a "very important role in maintaining system reliability, because of the flexibility it provides system operators."

It's crucial to remember that drought and less hydropower available in the Northwest was a determining factor in California's "2000-2001 Power Crisis" that cost the state $50 billion in added energy costs, illustrating the problems of California's over-reliance on outside energy (California also unsustainably imports over 90% of its natural gas, the nation's fastest growing major fuel, and the source that other states will increasingly lean upon most to meet the Clean Power Plan).

At the time, neighboring governors rightly complained about California's unwillingness to build new generation capacity in the 1990s even though its demand was rising (proof here).

Further, EPA's new plan could force many of those coal plants that California imports from to shut down, leaving the state even more vulnerable to brownouts and blackouts (concerns continue to be raised nationally about policies that are lowering the reliability of our power grid: Eaton reports that blackouts already cost the U.S. about $150 billion a year).

Why the highlight on the "natural gas" section above? Take a look at this chart from here:

That same source notes,

California’s single remaining operational nuclear power plant, Diablo Canyon Power Plant, accounts for less than one-tenth of total generation. California used to have multiple other nuclear power plants, including the Rancho Seco Nuclear Generating Station, the San Onofre Nuclear Generating Station, the Vallecitos Nuclear Center,[15] and the Humboldt Bay Nuclear Power Plant,[16] in addition to various other smaller experimental or prototype reactors which intermittently supplied power to the grid, such as the Sodium Reactor Experiment. However all of these reactors have been shut down due to both economic[17] and social[18] factors. Currently, the owner of the Diablo Canyon plant, Pacific Gas & Electric, has plans to shut down the two reactors at the site in 2025.[19] This lost generation will be made up with renewables.

Well, renewables better work hard. The Forbes piece notes that at least one major solar project is not exactly 100% pure:

This dominance of natural gas in California is "bordering on the absurd." Just look at California's troubled Ivanpah solar thermal plant near Nevada, being "paid four to five times as much per megawatt-hour as natural-gas powered plants." But, very quietly, Ivanpah has become a big natural gas plant.

That's because Ivanpah uses gas to preheat water that goes into boilers mounted on three 459-foot-tall towers, allowing "heat from the sun – captured by 352,000 mirrors – to make steam more quickly. The steam turns the turbines that produce electricity."

In 2014, enough natural gas was used at Ivanpah to meet the annual power needs of 17,000 California homes, or over 25% of the plant's total projected electricity output. Thus, Ivanpah is a hybrid gas and solar power plant,...

More to the point, the rest of the country is subsidizing this "hybrid" plant

Although owned by Google, NRG Energy, and Brightsource, who have a market cap over $500 billion, "The U.S. Department of Energy granted Ivanpah $1.6 billion in loan guarantees. As a green-energy project, it also qualified for more than $600 million in federal tax credits." Production is often 30-35% below expectations, a lack of generation that has increased the calls for Ivanpah to shutdown.

Ah, who pays for those loan guarantees and federal tax credits? The American taxpayer, most of whom do not live in California.

A long time ago I took an economics course which used as a text a book, Tanstaafl (There Ain't No Such Thing as a Free Lunch) - A Libertarian Perspective on Environmental Policy (and, yes, the concept is from Heinlein's The Moon Is a Harsh Mistress)- about which Amazon's blurb says,

In its most basic application, the TANSTAAFL principle is a simple statement of reality: everything of value has a cost. The TANSTAAFL principle can also be interpreted as a mandate for a policy of full-cost pricing. In a world where resources are scarce, everything has a cost. Scarce resources are used most efficiently when the price paid by the final user reflects all costs, including waste disposal, harm from pollution, and depletion of non-renewable resources.

Now, Californians already pay the highest energy prices in the country, but I am not sure they paying "full cost" pricing - instead, they seem to have shifted some large part of that burden to the rest of us. But should the element seeking secession prevail, the cost of independence might prove much higher than expected.

National Energy Security Issue: Effects of Cheap Oil

Photo Liberated from Patterson UTI Drilling

Once again the oil and gas industry has done too good a job is finding and developing new sources - so much so that its success is eating the drilling industry - the Oil & Gas Journal reports US rig count nearing lowest level in generations:

The US rig count dropped 12 units to 502 during the week ended Feb. 26, according to Baker Hughes Inc. data. While the decline is the smallest thus far this year, it represents the eighth straight weekly double-digit drop to begin 2016.
The total is the lowest since Apr. 30, 1999, a week after the 1998-99 downturn hit its bottom of 488. With additional losses in the coming weeks, the current count could dive to a level not seen in generations.

The NYTimes has reported on the "simple economics" behind the drop in oil prices:

. . . [I]t boils down to the simple economics of supply and demand.

Well, yeah.

The NPR folks have noted that these low prices, coupled with a decline in exploration and drilling, might just have an impact on the overall U.S. economy as businesses associated with that part of the oil and gas industry find less demand in Why Cheap Gas Might Not Be Good For The U.S. Economy:

Arora analyzed government data, and found that what's changed is that the oil and gas industry as a share of GDP has about doubled in the past decade. Now it has grown so large that it's changed the basic equation of whether cheap gas is a good thing overall.

"The benefits to consumers could be around $140 billion from gasoline savings," Arora says. "But the losses on the other side due to lower production, less investment, less build-out of infrastructure could be around that amount. So we're kind of at a wash."

This might help to explain why the economy still isn't exactly charging forward even with the stimulus of cheap energy. But Arora himself notes that the question needs more study.

Meanwhile, analysis by the research firm Moody's Analytics finds that cheap oil and gas are still a net positive. And plenty of experts remain in that camp.

Last year the NYTimes offered up Lower Oil Prices Provide Benefits to U.S. Workers:

Wall Street may be growing anxious about the negative impact of falling oil prices on energy producers, but the steep declines of recent weeks are delivering substantial benefits to American working-class families and retirees who have largely missed out on the fruits of the five-and-a-half-year economic recovery.

Just last week, the federal Energy Information Administration estimated that the typical American household would save $750 because of lower gasoline prices this year, $200 more than government experts predicted a month ago. People who depend on home heating oil and propane to warm their homes, as millions do in the Northeast and Midwest, should enjoy an additional savings of about $750 this winter.

“It may not have a huge effect on the top 10 percent of households, but if you’re earning $30,000 or $40,000 a year and drive to work, this is a big deal,” said Guy Berger, United States economist at RBS. “Conceptually, this is the opposite of the stock market boom, which was concentrated at the top.”

Of course, more dollars in the pockets of the 90% of the households not in the top 10% really ought to mean much more money available in the economy because of the law of big numbers. More from the NYT:

But the latest drop in energy prices — regular gas in New England now averages $2.35 a gallon, compared with $2.94 in early December, and it is even cheaper in the Midwest at $1.95 — is disproportionately helping lower-income groups, since fuel costs eat up a larger share of their more limited earnings.
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“Oil prices, gas prices, food prices — luckily it’s going down, which is great,” Ms. Smith said, explaining that when prices were higher she had to scale back on groceries to save money for heating oil. “I hope it keeps going.”

You might want to, at this point, recall President Obama's plan to increase taxes on oil as discussed in Oil Dumbness from President Obama an increase in taxes is paid for by customers of the oil companies just like Ms. Smith.

This ought to be self-evident, but here's another source talking about the effect of higher gas prices.

It's not just the U.S. that rides this roller coaster of oil prices. Oil exporting states like Saudi Arabia are also taking hits, as discussed in this Forbes article, 4 Reasons Saudi Arabia Can't Control Oil Supply:

In the past, OPEC—led by Saudi Arabia—would reduce production in order to maintain the oil price. Today, however, the process isn’t that easy, and there are four reasons for that…

Reason #1: The US
Oil above $60 or $70 would mean that US production would continue to increase, and the US is already the world’s #1 producer. OPEC would have no choice but to keep cutting further in order to maintain that price.

Reason #2: Cheating among OPEC Members
OPEC members (other than Saudi Arabia) almost always cheat on their production quotas when they can. Considering that other OPEC nations are desperate for income, the incentive to cheat is all powerful.

Reason #3 The US-Iran Nuclear Deal
The deal and subsequent lifting of sanctions means that an additional one million barrels per day will soon hit the market. As international oil companies vie for the privilege of drilling more oil in Iran, it will put further upward pressure on supply.

Reason #4: US Production in the Market
Although drilling rig usage in the US is down by nearly 75%, production has just now begun to fall off. It will take some time before enough US production comes off the market to put upward pressure on prices.

The U.S. Energy Information Adminsitration produces all sorts of reports on oil production like this one:

The "International Energy Agency" (which is actually a creature of its 29 member countries)has issued its 2016 Medium Term Market Report:

Global oil supply growth is plunging as an extended period of low prices takes its toll, the International Energy Agency (IEA) said in its annual Medium-Term Oil Market Report (MTOMR) released today. While U.S. light, tight oil (LTO) output is falling steeply for now, the market will begin rebalancing in 2017 – and by 2021 the United States and Iran are seen leading production gains among non-OPEC and OPEC countries, respectively.

There is this warning:

“It is easy for consumers to be lulled into complacency by ample stocks and low prices today, but they should heed the writing on the wall: the historic investment cuts we are seeing raise the odds of unpleasant oil-security surprises in the not-too-distant-future,” said IEA Executive Director Fatih Birol, launching the report at IHS CERAWeek.(emphasis added)

What "oil-security surprises?"

From the downloadable Overview of the IEA report:

Another downside to low oil prices is the impact on investment. The IEA has regularly warned of the potential consequences of the 24% fall in investment seen in 2015 and the expected 17% fall in 2016. In today’s oil market there is hardly any spare production capacity other than in Saudi Arabia and Iran and significant investment is required just to maintain existing production before we move on to provide the new capacity needed to meet rising oil demand. The risk of a sharp oil price rise towards the later part of our forecast arising from insufficient investment is as potentially de-stabilising as the sharp oil price fall has proved to be.

In addition to the effects of insufficient investment there are the lost "experience" costs that will result from personnel cutbacks in the oil and gas industry as rig counts and exploration budgets drop. Experienced oil field workers will, as they have in the past, move to other jobs (assuming they exist) that might pay less.

Ah, you might say, "So what?"

The "so what" is the lag time it would take to get those workers back into the fields should there be a national need for an increase in U.S. crude oil and natural gas production.

That lag time has national security issues.

Suppose, for example, Russia decides to cut off natural gas supplies to Europe beginning in late 2016 using that gas as an economic weapon to force the nations dependent on Russian gas to accept Russian claims in the Ukraine or the Baltic States. One way for the West to resist this pressure is to have some assurance that the U.S. and its allies will be able to set into motion a stream of LNG ships carrying gas to replace that of the Russians, ameliorating the gas situation for those affected states. In addition to LNG shipping, a force of air and naval escorts protecting that LNG stream at sea might be required to prevent interference with the flow of gas in competition with that of the Russians.

Or, suppose the Chinese interfere with the flow of gas and oil through the South China Sea sea lanes to Taiwan,South Korea and Japan. Can the U.S. and Canada help mitigate the harm while alternative sea lanes that avoid the South China Sea are developed? Who will protect those shipments and how?

Or, what if Iran or someone else takes the big step of managing to destroy the Saudi oil production - say through using nuclear weapons - can the U.S. and non-Middle East producers step up and provide  at least minimal supplies to the world now depending on Middle East oil?

Cheap oil is good, but not all good.

Energy Wars: The "Shale-Oil Insurgency"

Interesting analysis from Nikos Tsafos writing in The National Interest Shale-Oil Surprise: OPEC Faces an Insurgency, Not a Price War

Between June and November 2014, oil prices have fallen by some 40 percent, courtesy of robust growth in output and a bleaker outlook for oil demand. In late November, The Organization of Petroleum Exporting Countries (OPEC) chose to keep its production quotas intact, triggering several obituaries and talks of a price war between OPEC and the United States, where most of the additional supply originates. Yet war is not quite the right term; insurgency is more like it—decentralized, adaptive and, likely, inconclusive.

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Gone are the days where high oil prices triggered a production response with a seven-to-ten-year lag (to allow for acreage acquisition, exploration, appraisal and then development of an oil field). When a system can grow as quickly as the United States’ can, then clearly, the world has a competing source of “spare capacity,” meaning capacity that could come online quickly to meet market needs.

Good read.

And, really, isn't "energy independence" mostly about being able to quickly fill market needs?

"Decentralized" "Adaptive" -- I like that in the energy context.

Energy Policy: What "Green Jobs" Revolution in the U.S. Economy?

Too bad this editorial Green jobs fading from the 27 Oct 14, Oil And Gas Journal is hidden behind a subscription wall because more Americans need to be aware of the expensive sham of alleged "green energy" jobs that has cost them billions:

While campaigning for election to his first term, President Barack Obama promised to create 5 million green jobs in 10 years. Once in office, he maneuvered Congress into passing the American Recovery and Reinvestment Act (ARRA) of 2009, a $840-billion spending spree that included about $90 billion for energy and, of course, green jobs. Results have not been spectacular. In fact, they testify to core problems of governmental profligacy.
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So how many green jobs did the munificent government create with AARA energy money? An administration proudly dedicated to transparency must find that question disturbing.

In March 2013, the Bureau of Labor Statistics, part of the Department of Labor, reported employment associated with production of green goods and services in 2011 amounted to 3.4 million jobs. That was an increase of 158,000 jobs from the prior year, corrected in both cases to account for adjustments in estimation methods. But what jobs were being counted? The BLS explained its definitions and methods elaborately. By the time it issued its report for 2011, however, the validity of those methods had been shredded.

In a June 6, 2012, hearing of the House Committee on Oversight and Government Reform, Chairman Darrell E. Issa (R-Calif.) elicited an illuminating sequence of confessions from acting BLS Commissioner John Galvin, now deputy commissioner. A person could be counted by BLS as holding a green job, Galvin had to admit, if he or she swept floors in a solar-paneled facility, drove a hybrid bus in public transportation or even a school bus, pumped fuel into a school bus, worked in a bicycle shop, sold recycled goods in an antique store or Salvation Army outlet, or collected garbage. These revelations discredited official numbers, formerly flaunted, about green jobs. Responding to spending cuts mandated under sequestration provisions of the Balanced Budget and Emergency Deficit Control Act, BLS made its green-job report for 2011 the last.

Program troubles didn't end there. In June last year, the Government Accountability Office raised questions about the $501 million of targeted ARRA funds Labor spent on training for green employment. Required by the statute to act quickly, GAO said, Labor implemented several programs simultaneously. "As a result," it said, "in some cases Recovery Act training programs were initiated prior to a full assessment of the demand for green jobs." And in this program, too, definitions were flexible. According to GAO, "Labor created its green jobs definitional framework to provide local flexibility, and grantees we interviewed broadly interpreted Labor's framework to include any job that could be linked, directly or indirectly, to a beneficial environmental outcome."

At the time of the GAO report, incomplete data made results of the training effort uncertain. Information from grant recipients reporting final outcomes indicated slightly more individuals than projected had received training, GAO said. But job placements were only 55% of the target level.

Let me direct you to this series of articles (full disclosure they written by my brother, a long-time reporter for the L.A. Times) on one example of "stimulus money" gone awry:

. . . the federal Department of Energy in 2009 and 2010 pitched in with $9.9 million in stimulus grants — part of the Obama administration effort to create jobs and revive the American economy.

To date, however, not one of the proposed North American Power Group plants has been built. The stimulus grants — ostensibly to study carbon sequestration potential on the Two Elk site — were suspended by the DOE in January 2012 because of numerous accounting irregularities.

But that was not until $7.3 million of the stimulus money had already been spent, much of it on inflated salaries . . .

A couple of million here, a couple of million there. Pretty soon it adds up. Not necessarily in job creation, though.

In the meantime, job growth largely fueled by the private energy industry due to fracking and the development of shale gas sites has been significant:

The U.S. Energy Information Administration (EIA) projects that U.S. annual natural gas production will increase from 23.0 trillion cubic feet in 2011 to 33.1 trillion cubic feet in 2040, a gain of 10.1 trillion cubic feet (44.0 percent).2 More than 87 percent of this increase is due to growth in shale gas production, whose share of total natural gas production is projected to reach 50.4 percent by 2040.3 Because of this rapid growth, the oil and natural gas industry has experienced large employment and wage increases over the past few years. Many of these increases have occurred in areas outside the “oil patch” region, which produces a substantial amount of U.S. oil and natural gas and comprises the states of Oklahoma, Texas, and Louisiana.

The U.S. Bureau of Labor Statistics kindly produced the following chart on such job growth:

You might note those are just jobs in the "oil and natural gas industry" and does not, apparently count jobs of people in industries who provide services to those oil and gas workers. Heck, if you count floor sweepers, motel clerks, school bus drivers, etc, those numbers might even be higher.

And, before you go off on the hazards of "non-green" energy (which I would assert you need to be careful in doing when natural gas is involved), you might be interested in the huge pollution bomb that is China:

China's emissions already exceed the US and EU combined, it emits more per capita than Europe and could overtake America by 2017.

Well, of course, there is a big capita difference involved.

Can you say "misguided" and ""unsupervised?" That seems to be the theory behind throwing "green job" stimulus money around. If you need to review it, there's a pretty good look at the $535 million Solyndra Scandal from the Washington Post:

Meant to create jobs and cut reliance on foreign oil, Obama’s green-technology program was infused with politics at every level, The Washington Post found in an analysis of thousands of memos, company records and internal ­e-mails. Political considerations were raised repeatedly by company investors, Energy Department bureaucrats and White House officials.

Sure, old news. But we are still paying for it - especially, I would argue, in the reduced funding for national security matters, including readiness.

UPDATE: Changed link to Rone Tempest Wyofile articles to give you the best possible access.

Long-Endurance Electric Unmanned Aircraft and the Potential for Other Things

USNRL photo

The engineers and scientists at the Navy Research Laboratory have successfully tested a long-endurance unmanned aircraft using a special tank of liquid hydrogen to feed fuel cells. Read more at "NRL Shatters Endurance Record for Small Electric UAV::

Researchers at the U.S. Naval Research Laboratory (NRL) flew their fuel cell powered Ion Tiger UAV for 48 hours and 1 minute on April 16-18 by using liquid hydrogen fuel in a new, NRL-developed, cryogenic fuel storage tank and delivery system.
***
Liquid hydrogen is three times denser than 5000-psi compressed hydrogen. The cryogenic liquid is stored in a lightweight tank, allowing more hydrogen to be carried onboard to increase flight endurance. Success in flight requires developing a high quality, lightweight insulated flight dewar for the cryogenic fuel, plus matching the boil off of the cryogenic hydrogen to the vehicle fuel consumption.
***
To address the logistics of in-theater supply of liquid or gaseous hydrogen, NRL proposes in-situ manufacture of LH2 for use as fuel. An electrolyzer-based system would require only water for feedstock, and electricity, possibly from solar or wind, to electrolyze, compress, and refrigerate the fuel.

Much quieter and long-endurance, too. I wonder what its thermal signature looks like?

So, fuel from water to a special tank to power fuel cells to drive electric motors.

Potentially a game changer in the world of powering land vehicles, too,  I would think.

Makes me wonder a little about the future of fossil fuels.

Energy Wars: Fusion Power

Aviation Week got an exclusive look at Lockheed's fusion reactor:

Lockheed estimates that less than 25 kg (55 lb.) of fuel would be required to run an entire year of operations. The fuel itself is also plentiful. Deuterium is produced from sea water and is therefore considered unlimited, while tritium is “bred” from lithium. “We already mine enough lithium to supply a worldwide fleet of reactors, so with tritium you never have too much built up, and that’s what keeps it safe. Tritium would be a health risk if there were enough released, but it is safe enough in small quantities. You don’t need very much to run a reactor because it is a million times more powerful than a chemical reaction,” McGuire notes.

Faster. But be safe.

Five or so years to another breakthrough that eases the stress on fossil fuels and the land and maritime routes needed to get them to market?

Cool.

Energy Wars: Marcellus "Miracle" Continues

Was it only a few short years ago that there was concern over "peak oil" and worry over the dwindling supply of U.S. natural gas? Why, yes it was.

Then along came shale oil and gas.

A revolution that changed everything, as noted in this Oil and Gas Journal article, "Marcellus continues to defy expectations, driving US gas production ever higher":

Shale has been the primary driver of US gas supply growth since 2007, and the Marcellus shale has been the largest single contributor to rising production.

Marcellus production topped 14.5 bcfd in March and is expected to account for nearly one fourth of all US gas output by 2015, according to a report by Morningstar Inc.

The Marcellus's eminent position stems, in part, from the ability of wells in the formation to come online at high initial production (IP) rates and to sustain those rates for longer than wells in other shale formations.
***
The Marcellus stretches across portions of Pennsylvania, Ohio, West Virginia, and New York. Moody's Investor Service figures the formation holds an estimated 141 tcfe of recoverable reserves.

Marcellus output climbed from virtually nothing in 2007 to 9 bcfd in 2013, equivalent to the combined production growth of the Haynesville (4 bcfd), Eagle Ford (3 bcfd), and Barnett (2 bcfd) shales. According to Morningstar, output from the formation helped boost US production 14 bcfd, or 25%, during the 6-year period, more than offsetting declines from conventional reservoirs and the Gulf of Mexico.

If not for the Marcellus, Morningstar found, US gas production would likely have peaked in late 2011 or early 2012 as producers reduced gas-directed drilling in response to weak domestic gas prices.
***
The Marcellus shale has fundamentally altered the outlook for the US natural gas industry. The US is emerging as a low-cost chemicals producer and is poised to become an exporter of natural gas—a feat unthinkable just 5 years ago when it was widely believed that increasing LNG imports would be needed to meet domestic demand.

According to Hanson, "In short, the growth of the Marcellus over the next several years is likely to be nothing short of astounding."

Europe ought to be happy, too, if the U.S. can get its LNG export business in motion. The Russians? - well, not so much.

U.S. Oil and Gas: Keeping the U.S. Economy Afloat?

The Oil and Gas Journal says, "Study notes boosts from US drilling boom":

• Overall US employment has yet to return to its prerecession level, but the number of oil and gas jobs has grown 40% since then.

• In the 10 states at the epicenter of oil and gas growth, overall statewide employment gains have greatly outpaced the national average.

• A broad array of small and midsize oil and gas firms are propelling record economic and jobs gains—not just in the oil fields but across the economy.

****

• The shale revolution has been the nation's biggest single creator of solid, middle-class jobs—throughout the economy, from construction to services to information technology.

• Nearly 1 million Americans work directly in the oil and gas industry, and a total of 10 million jobs are associated with that industry.

***

• America's oil and gas boom has added $300–400 billion/year to the economy; without this contribution, GDP growth would have been negative, and the nation would have continued to be in recession.

I wonder how all the billions of government dollars spent in developing "green jobs" has worked out in comparison?

Death to the Great Green Fleet: "Natural Gas Supply Puts Damper On Renewable Energy"

Aviation Week writes "Natural Gas Supply Puts Damper On Renewable Energy":

Projections that the U.S. will become all but self-sufficient in energy by 2035 have profound implications for an aviation fuels market in the early stages of moving from a dependence on petroleum to encompassing a wide and varied range of sources.

Abundant and inexpensive natural gas is making it more difficult for renewable energy sources to establish themselves in the U.S. The nascent biofuels industry is being affected, as gas can be converted to liquid fuels in the near term and in the longer term liquefied natural gas could be used directly in aircraft engines . . . Some alternative-fuel start-ups have switched from biomass to natural gas.
***
But it is the Navy's goals that are drawing the most criticism from conservative lawmakers. Empowered by the Defense Production Act, the Navy has entered into a $510 million agreement with the Energy and Agriculture Departments to promote the development of a domestic advanced biofuel industry through the construction of biofuel refineries. The Navy's share is a $170 million investment, mainly in procurement of fuels to meet its goal of deploying a “Great Green Fleet” strike group of ships and aircraft running entirely on alternative blends by 2016, en route to meeting half of its total energy needs from alternative sources by 2020. To do so, the Navy would need to replace about 8 million barrels of petroleum with unblended alternative fuels by 2020, the Congressional Research Service (CRS) reported in December.

But being an early adopter means paying higher prices, and House Armed Services Committee (HASC) Republicans such as Reps. Randy Forbes (Va.) and Michael Conaway (Texas) say the Navy spending is misguided—particularly as sequestration cuts are hurting military readiness and threatening future technological advantages by starving research and procurement spending. As part of the HASC bill markup in June, Conaway sponsored three successful amendments to ban defense buys of biofuels until their price matches conventional fuel, as well as to halt defense spending for biofuel refineries and encourage Pentagon spending on oil sands and coal-to-liquid fuel.

“This is an area that is better suited for the Energy Department to pursue and to get these fuels affordable and competitive,” Conaway says of alternatives. “If we are needing to apply them, to use these biofuels here in the U.S. to protect the homeland, that would be one thing—but that's not the case.”

But HASC Democrats such as Rep. Rick Larsen (Wash.) stress that finding alternatives to petroleum has been a key naval concern for decades, leading to innovations like nuclear-powered aircraft carriers and submarines or the DDG-1000's integrated electric-drive technology. “If in the short term there is a little bit of an expense, well, in the short term there was a little bit of expense in developing oil way back in the day,” Larsen says. “But having alternatives to oil and not being completely dependent, that is important. It's been important in the Navy for a while.”

Gee, Mr. Larsen, natural gas frees up U.S. oil and thus reduces or eliminates "dependence" - and it doesn't cost 4 or 5 times the going rate. Previous thoughts on the silliness of Navy's alternative fuel plan here and here.

Of course, natural gas is a fossil fuel which the current administration views as really, really evil and bad.

Energy: "New Gas Extraction Methods Alter Global Balance of Power"

Yes, this is another post on the importance of U.S. shale gas. For those of you unfamiliar with shale gas, a good source of information is at the U.S. Energy Information Administration's "What is shale gas and why is it important?":

Of the natural gas consumed in the United States in 2011, about 95% was produced domestically; thus, the supply of natural gas is not as dependent on foreign producers as is the supply of crude oil, and the delivery system is less subject to interruption. The availability of large quantities of shale gas should enable the United States to consume a predominantly domestic supply of gas for many years and produce more natural gas than it consumes.

So what, you might ask? Well, there are huge national and international security issues involved, as set out a couple of month's ago in Der Spiegel, "New Gas Extraction Methods Alter Global Balance of Power":

The gas revolution is changing the political balance of power all over the world. Americans and Russians have waged wars, and they have propped up or toppled regimes, over oil and gas. When the flows of energy change, the strategic and military calculations of the major powers do as well.

It is still unclear who the winners and losers will be. The Chinese and the Argentines also have enormous shale gas reserves. Experts believe that Poland, France and Germany have significant resources, although no one knows exactly how significant. Outside the United States, extraction is still in its infancy.

The outlines of a changed world order are already emerging in the simulations of geo-strategists. They show that the United States will benefit the most from the development of shale gas and oil resources. A study by Germany's foreign intelligence agency, the BND, concludes that Washington's discretionary power in foreign and security policy will increase substantially as a result of the country's new energy riches.
***
According to the BND study, the political threat potential of oil producers like Iran will decline. Optimists assume that, in about 15 years, the United States will no longer have to send any aircraft carriers to the Persian Gulf to guarantee that oil tankers can pass unhindered through the Strait of Hormuz, still the most important energy bottleneck in the world.

The Russians could be on the losing end of the stick. The power of President Vladimir Putin is based primarily on oil and gas revenues. If energy prices decline in the long term, bringing down Russian revenues from the energy sector, Putin's grip on power could begin to falter. The Americans' sudden oil and gas riches are also not very good news for authoritarian regimes in the Middle East.

European industry is also likely to benefit from falling world market prices for oil and gas. But according to prognoses, without domestic extraction the Europeans' site-specific advantages deteriorate.(emphasis added)

See also Rice University's Baker Institute publication "Shale Gas and U.S. National Security" . Back in August 2011, we had a discussion on Midrats with Amy Myers Jaffe (my referring blog post was Sunday on Midrats: Gas Shale and National Security), the show is Episode 83) we finally got Ms. Jaffe online at about 31:24 into the show):

Listen to internet radio with Midrats on Blog Talk Radio

Now, who benefits from open sea lanes on which the U.S. could export LNG? Why just about everyone! Except, of course, for the Russians and the Middle East maybe. Who keeps those sea lanes open? The U.S. Navy. Who should we lend a hand to in exploring their potential for shale gas? Poland, Germany, France? China? Argentina? Australia? What about Japan? It stands to benefit from an open sea lane to receive LNG (liquified natural gas) from the U.S. and other places. See Issues Facing U.S. Shale Gas Exports To Japan.
Hat tip for Der Spiegel article: NavalHistWarStudies

Mining Methane Hydrate and What It Means

First, the "Methane Hydrate" scary story:

(University of Göttingen, GZG. Abt. Kristallographie).
Source: United States Geological Survey.

As greenhouse gas, methane is more powerful than carbon dioxide, but there is a much more important difference between these two gases. Carbon dioxide emissions are something that we create and that we can control, at least in principle. If we stop burning fossil fuels, then we stop generating CO2. But, with methane, it is another matter. We have no direct control on the huge amounts of methane buried in ice in the permafrost and at the bottom of oceans in the form of "hydrates" or "clathrates."

Methane hydrates are a true climate bomb that could go off by itself as the result of a relatively small trigger in the form of a global warming. Sufficient warming would cause the decomposition of some hydrates to release methane to the atmosphere. This methane would create more warming and that would generate more decomposition of the hydrates. The process would go on by itself at increasing rates until the reservoirs run out of methane. That means pumping in the atmosphere truly a lot of methane. There are different estimates of the amount stored in hydrates, but it is surely large - most likely larger than the total amount of carbon present today in the atmosphere as CO2. The effects of the rapid release of so much methane would be devastating: an abrupt climate change that could bring a true planetary catastrophe. It is a scenario aptly called the "clathrate gun" and the target is us.

Source

Second, a quick look at issues in trying to exploit methane hydrate as a fuel source in The Risky Business of Mining Methane Hydrate:

The potential rewards of releasing methane from gas hydrate fields must be balanced with the risks. **** Let's start first with challenges facing mining companies and their workers. Most methane hydrate deposits are located in seafloor sediments. That means drilling rigs must be able to reach down through more than 1,600 feet (500 meters) of water and then, because hydrates are generally located far underground, another several thousand feet before they can begin extraction. Hydrates also tend to form along the lower margins of continental slopes, where the seabed falls away from the relatively shallow shelf toward the abyss. The roughly sloping seafloor makes it difficult to run pipeline.

Even if you can situate a rig safely, methane hydrate is unstable once it's removed from the high pressures and low temperatures of the deep sea. Methane begins to escape even as it's being transported to the surface. Unless there's a way to prevent this leakage of natural gas, extraction won't be efficient. It will be a bit like hauling up well water using a pail riddled with holes.

Believe it or not, this leakage may be the least of the worries. Many geologists suspect that gas hydrates play an important role in stabilizing the seafloor. Drilling in these oceanic deposits could destabilize the seabed, causing vast swaths of sediment to slide for miles down the continental slope.

On the other hand, developing methane hydrate mining might ease some of those worries of a catastrophic release if done safely and it does offer a fuel source. As set out in Mining "Ice That Burns":

Trapped in molecular cages resembling ice, at the bottom of the ocean and in terrestrial permafrost all over the world, is a supply of natural gas that, by conservative estimates, is equivalent to twice the amount of energy contained in all other fossil fuels remaining in the earth’s crust. The question has been whether or not this enormous reserve of energy, known as methane hydrates, existed in nature in a form that was worth pursuing, and whether or not the technology existed to harvest it.
***
While no one believes that all of the world’s methane hydrates will be recoverable, the scale of global reserves has been described by the U.S. Department of Energy as “staggering.” They occur anywhere that water, methane, low temperatures, and high pressure co-occur–in other words, in the 23 percent of the world’s land area covered by permafrost and at the bottom of the ocean, particularly the continental shelf.
***
The United States is not the only country with plans to attempt long-term production tests of methane hydrates. Japan is spending by far the most money on methane hydrate research; it provided most of the funding for the Mallik tests, which were sponsored by the Japan Oil, Gas and Metals National Corporation and by Natural Resources Canada, with field operations by Aurora College/Aurora Research Institute and support from Inuvialuit Oilfield Services.

According to the Center for Hydrate Research’s Koh, Japan is investing heavily in attempts to harvest deep-sea hydrate reserves discovered off the southern coast of Japan in the Nankai Trough.

“The Japanese are planning commercial production from the Nankai Trough by 2017,” says Koh. If they succeed, Japan will tap the first domestic fossil-fuel reserves the country has ever known.

A Popular Mechanics "demystification" of "Fire Ice" here, which looks at the "scary story" above:

But what if the earth released the gas as a result of heating up? Not only energy companies but also scientists studying climate change have a major interest in methane hydrates. Methane is a greenhouse gas, a far more powerful one than carbon dioxide, and some scientists fear the warming of the earth could destabilize hydrates to the point that they release methane into the atmosphere, further worsening global warming. Ideas such as the clathrate gun hypothesis suggest that methane hydrate dissociation is linked to prehistoric global warming.

However, according to a Nature Education paper published by the USGS, only about 5 percent of the world's methane hydrate deposits would spontaneously release the gas, even if global temperatures continue rising over the next millennium. In addition, bacteria in the nearby soil can consume and oxidize the methane so that only a minute fraction (as low as 10 percent of the dissociated methane) ever reaches the atmosphere.

So, now, you have the background to understand this report, Methane hydrate flow established off Japan:

Japan Oil, Gas and Metals National Corp. (Jogmec), Tokyo, said it has produced methane from methane hydrates during tests of a well drilled in about 1,000 m of water offshore the Atsumi and Shima peninsulas of Japan.

The well, operated by Japan Petroleum Exploration Co., produced methane by depressurization of hydrates in a layer 270-330 m below the seabed.

Jogmec said it was the first offshore test of methane hydrate flow ever conducted.

Jogmec's summary of its activities here.

Baby steps to diminishing the importance of Mid-East energy and easing some issues over sea lanes.

National Energy Security: Coming "Golden Energy Era"

Oil and Gas Journal reports "US on brink of strong oil, gas growth, Senate panel told":

“We believe that by 2020, the United States will become the largest producer of hydrocarbons in the world, surpassing Russia,” said Roger Diwan, partner and head of financial advisory operations at PFC Energy. Now that producers have solved the problem of producing oil and gas from tight shale formations, the nation is on the verge of a golden energy era which is reshaping the industry worldwide, he maintained.
***
The scale of the opportunity to increase US oil production is greater than in most other countries over the next decade, noted James Burkhard, managing director of IHS CERA Inc.’s global oil group.
***
Howard K. Gruenspecht, acting administrator at the US Energy Information Administration, said the US Department of Energy’s independent forecasting and analysis agency’s initial 2012 Annual Energy Outlook (AEO) reference case forecasts 20% growth in US crude production over the next decade. Net petroleum imports are expected to drop from 49% of total US consumption in 2010 to 38% in 2020 and 36% in 2035 as a result, he said.

So, less reliance on foreign producers, brought to you by the petroleum industry. You know this is much better for national security and our maritime energy security. And, as a bonus, it buys time for all those expensive bio-fuels projects to be perfected . . .

Another Large U.S. Natural Gas Discovery?

Geology.com asks, "Utica Shale - The Natural Gas Giant Below the Marcellus?":

The Utica Shale is a rock unit located a few thousand feet below the Marcellus Shale. It also has the potential to become an enormous natural gas resource. The Utica Shale is thicker than the Marcellus, it is more geographically extensive and it has already proven its ability to support commercial production.

It is impossible to say at this time how large the Utica Shale resource might be because it has not been thoroughly evaluated and little public information is available about its organic content, the thickness of organic-rich intervals and how it will respond to horizontal drilling and hydraulic fracturing. However, the results of early testing indicate that the Utica Shale will be a very significant resource.

Where is the Utica Shale?

The potential source rock portion of the Utica Shale is extensive. In the United States it underlies portions of Kentucky, Maryland, New York, Ohio, Pennsylvania, Tennessee, West Virginia and Virginia. It is also present beneath parts of Lake Ontario, Lake Erie and part of Ontario, Canada. ***

On the map above, I added a red box to the outline of the Utica play, with a blue arrow pointing to what I believe to be the line showing the estimated range. There's a nice map at the Geology.com link.

I think we are a lot more "energy independent" than most people believe.

This guy gets it: "Viva the shale gas revolution"

Eastern U.S. Marcellus Shale Fields

Jack Kelly at the Pittsburgh Post-Gazette does a nice job explaining the benefits of the large shale gas discoveries in the U.S. in his piece "Viva the shale gas revolution":

***
Spindletop* made possible the mechanization of agriculture, which increased food production and dropped its price. Because the necessities of life cost less, we could spend more on what for ages past were luxuries only the rich could afford.

Buoyed by cheap food and cheap energy, the middle class grew in size and affluence. It's shrinking now, as Americans get squeezed between stagnant wages and rising prices for food and gas.

But in this dark hour comes an energy development that can revive our economy, restore upward mobility to the middle class and reduce the threat of Islamist terror.

This Spindletop-on-steroids is natural gas trapped in "black" shale, made accessible by hydraulic fracturing (fracking). The Marcellus Shale formation alone may contain 84 trillion cubic feet of recoverable natural gas, the U.S. Geological Survey said in August. That's up from the 2 tcf the survey had estimated in 2002.
***
Marcellus Shale added 44,000 jobs in Pennsylvania and 13,000 jobs in West Virginia in 2009, according to researchers at Penn State. Ohio could add more than 200,000 jobs in just four years, an industry group there estimated in September. Nationally, the direct and indirect gains in jobs are measured in millions.

We could be energy independent in less than a decade. Iran, Saudi Arabia and Russia stand to lose their geopolitical clout.

Nothing in this life is all gain and no pain, but shale gas comes as close as anything ever has. So why are many Democrats trying to strangle Spindletop II in its crib?

The EIA's figures make it clear why "renewable" energy firms like Solyndra go bust despite massive subsidies. So President Barack Obama is trying to jack up the price of energy to make solar and wind seem less outrageously expensive.

"Under my plan of a cap and trade system, electricity rates would necessarily skyrocket," Mr. Obama told the editorial board of the San Francisco Chronicle in 2008.

A few politically connected people, such as Solyndra's George Kaiser, have made millions from "green" energy subsidies and mandates. They, in turn, give lots of money to Democrats.

Shale gas undermines this backscratching. Abundant, safe, inexpensive and environmentally friendly, it destroys the arguments for wind and solar power.

Yes.

Read the whole thing.

Oh, and if you are worked up about the water issues involved in fracking, see here for info on an invention that may solve that issue.

*Spindletop was the original big oil gusher in Texas that ushered in the age of oil.

I think this is a bad idea: "Promotion boards to look at energy efficiency"

While it pains me to say it, the Secretary of the Navy continues to assert a mythical "energy vulnerability" while inserting what can only be construed as a "green" component into Navy officer promotions, as reported at Promotion boards to look at energy efficiency - Navy Times:

Navy Secretary Ray Mabus, who has spent the past two years trying to wean the service off of fossil fuels, said promotion boards will consider an officer’s energy management when deciding whether to move him up. Furthermore, Battle E commendations will be based, in small part, on a command’s ability to sip fuel instead of guzzle.

Look, if the SecNav wants to cut fuel costs that's arguably a good idea, though I would assert it is not necessary to take drastic measures that will hurt combat preparedness. What fries my bacon is his persistent assertion that there is an U.S. strategic fuel shortage and that it requires drastic steps, including pumping millions of DON money into creating a "biofuels" market. Why isn't he screaming for more nuclear powered ships? That's the ultimate effective "energy management" to beat the SecNav's concerns of reducing

. . . the sea services’ dependence on oil from adversaries while reducing the need to refuel, which takes ships out of combat while making them vulnerable to attacks.

As I have said before here, and here, the U.S. has plenty of fossil fuels to operate our Navy for hundreds of years. In the latter post I wrote, "When we claim we're "hostages" to foreign energy, we're just being stupid. Politically correct, but stupid." Develop the energy we have, and stop this nonsense.

This program of the SecNav is a another misstep in already overly "politically correct" environment.

Chart from here

On the other hand, sail makers should be out in force, selling "new" wind energy tools for optimum fuel savings for promotion hungry officers.

Or, hey, just tie the ships up and send the crews home to practice being at sea by playing video games and following other silly guidelines.