Bush to ask Congress to clear way for offshore oil drilling

[xrayzebra]

Well, in the spirit of the other oil post... I guess I have to ask what the objective is.

My personal opinion is that our objective should be to move away from an oil based economy, in which case I don't support the drilling for any additional oil supply if it comes at the expense of our other natural resources. I think the policy of the US to be to aid in the destruction of oil demand.

Scott, since you are in the oil industy, why do I suspect your motives. Something just doesn't ring true.

Oil is cheap in comparison to any other energy source and despite what you keep harping on it is still fairly plentiful. I know you are suppose to be a PHD in oil (finance or whatever). But you too have to depend on what is fed to you through different stat reports, ect. My old Granddad used to say I am not saying your story is fishy, but there seems to be a few minnows floating on top of the water. Oil is what made this country. Oil is what more or less made our middle class. It is not going away anytime soon. So lets exploit it and work on other sources at the same time. Not abandoned our oil based economy and go running in all the different directions that we are now attempting to do. You know airplanes replaced trains and buses for most passenger travel, but both those industries still exist and fulfill a need. And oil will continue to fill a need for pharmaceuticals, rubber, clothing and other goods.

[ElNono]

Scott, since you are in the oil industy, why do I suspect your motives. Something just doesn't ring true.

Oil is cheap in comparison to any other energy source and despite what you keep harping on it is still fairly plentiful. I know you are suppose to be a PHD in oil (finance or whatever). But you too have to depend on what is fed to you through different stat reports, ect. My old Granddad used to say I am not saying your story is fishy, but there seems to be a few minnows floating on top of the water. Oil is what made this country. Oil is what more or less made our middle class. It is not going away anytime soon. So lets exploit it and work on other sources at the same time. Not abandoned our oil based economy and go running in all the different directions that we are now attempting to do. You know airplanes replaced trains and buses for most passenger travel, but both those industries still exist and fulfill a need. And oil will continue to fill a need for pharmaceuticals, rubber, clothing and other goods.

My biggest beef, is that there's absolutely no incentive for the Oil cartel to lower the prices, even if they start drilling everywhere. Saudis say there's no supply problem. The Chevron CEO claims there is, and the only solution is to drill at home. There's no compe ion in the Oil market. They keep reaping record profits, and what guarantee you have they won't turn around and say, "You know, there's not enough oil here" and keep on going with their record pricing/profits?
At least where we are right now forces companies to start looking in other directions. The only way you're going to make a dent on this Oil business is if you actually have a viable competing product. There's no such thing right now, and they know it and they'll keep abusing their position for as long as there is not.

[scott]

Scott, since you are in the oil industy, why do I suspect your motives. Something just doesn't ring true.

Oil is cheap in comparison to any other energy source and despite what you keep harping on it is still fairly plentiful. I know you are suppose to be a PHD in oil (finance or whatever). But you too have to depend on what is fed to you through different stat reports, ect. My old Granddad used to say I am not saying your story is fishy, but there seems to be a few minnows floating on top of the water. Oil is what made this country. Oil is what more or less made our middle class. It is not going away anytime soon. So lets exploit it and work on other sources at the same time. Not abandoned our oil based economy and go running in all the different directions that we are now attempting to do. You know airplanes replaced trains and buses for most passenger travel, but both those industries still exist and fulfill a need. And oil will continue to fill a need for pharmaceuticals, rubber, clothing and other goods.

I think it is healthy to be skeptical, but I hope your skepticism is founded on something other than the fact that I have an opinion you don't like. That isn't skepticism, it's just head-in-the-sand syndrome.

I try to stick to presenting what I know, which is the facts and the economic theory behind things. If I'm sharing my opinion, I always try to preface it as such. My opinions are based on the fact, but in the end they are just my opinions. If you are skeptical of the source of the facts, then that is another issue. I am highly confident in their accuracy, however.

Now, just because I have a lot of working knowledge of the industry because of my involvment in it, doesn't mean I can't be of the opinion that we should move away from an oil based economy. That doesn't mean we should all live in straw huts and ride horse drawn buggies tomorrow. Obviously it is going to be a gradual transition from an oil-based economy, but it is a transition that will happen. How painful that transition is for us will depend on our willingness and desire to be part of the transition.

If we decide we'll just ride it out and not be part of the transition, then we will one day be hit with prices that make the current ones seem like peanuts, and we will have no means to combat it other than to face a major economic depression and take our lumps that way.

Or, we can begin the transition on our terms so that when the inevitable crunch comes, we will be prepared to weather the storm.

I've always said (on these forums, to my professional colleagues and clients, to my students, etc.) that this planet will never run out of oil. I say that not because it is plentiful, but because the laws of economics will dictate it. As demand outstrips supply, prices will only continue to rise. As this happens, our demand for oil will eventually be destroyed (replaced by alternatives), and a bunch of oil we neither want or need will be left sitting in the ground. "Exploiting what we have and then moving on" is not a realistic option, because that isn't the way things work. Changes like this require proactive thinking.

In the end, it all comes down to objectives, like I stated in the other thread. Personally I believe (my opinion) that making oil cheap is the wrong objective. Again, one of my favorite analogies is "you don't cure an addict by providing him with a bunch of cheap crack."

I guess the question should be: what is your objective?

[Wild Cobra]

There are two prohibitions on offshore drilling, one imposed by Congress and another by executive order signed by Bush's father in 1990.

Can you point out the prohibitions? I read the executive order, and I didn't see it. Did I miss it?

[Don Quixote]

We need to send Manu Ginobili in there ...

He'll get the legislation through.

[RandomGuy]

Represen ive of New York proposed it today and has many backers.

Just saw him have a press conference about it on Fox Business news.

Linky Dinky Doo

Seriously, it took me less than 2 minutes to find this. Not providing links when asks just means you are lazy, not cramped for time, sheesh.

[RandomGuy]

I bet I can find a link for my claim before you for yours...

It was a semi-serious suggestion by ONE guy at a press conference. Not that the sentiment isn't shared by others on the left, but to hear Fox News and the blather-sphere talk about it, you would think that the commies are coming...

Objectively, it was a reaction to Bush's suggestion that we have a free-for-all in terms of oil drilling off-shore.

I think the intent was to give the Republicans as distasteful an alternative as the off-shore free-for-all is to Democrats. "If you do this, we'll do this." kinda thing.

I think it is a bit funny to see righties flapping their arms and running around like chickens with their heads cut off at a suggestion that few in the Democratic party take seriously. (note that I didn't say "no one in the Democratic party...")

[RandomGuy]

Can you point out the prohibitions? I read the executive order, and I didn't see it. Did I miss it?

Yes, you did. You might want to read up on the associated Act as well.

[boutons_]

"there is a moratorium on drilling in certain coastal areas. Other areas are not only open to drilling but leases and drilling permits have already been issued.

And they are not being drilled.


In fact, only 17% of the leased areas is in production. So, with about 33 million acres of offshore areas already available to drill and not being drilled, why does the oil and gas industry need to have access to still more? The fact is that nearly 25 BILLION barrels of oil off the coast of the United States is currently available for drilling...and industry is not drilling it.


Not to mention natural gas. Most of the natural gas occurring offshore (over 328 TRILLION cubic feet – an eleven year supply at current consumption rates) is currently available for leasing and development.
And they’re not going after it."


"It has been estimated that if all of those currently inactive leases were drilled, the USA would produce an additional 4.8 million barrels of oil and 44.7 billion cubic feet of natural gas EVERY DAY, accounting for a doubling of US oil production and a 75% increase in US natural gas production. The Minerals Management Service tells us that about 80% of fossil fuels available in offshore are currently available for development."



http://www.dailykos.com/storyonly/20.../614/81/537906


================


As always, dubya is lying about the "ban".

[2centsworth]

I think it is healthy to be skeptical, but I hope your skepticism is founded on something other than the fact that I have an opinion you don't like. That isn't skepticism, it's just head-in-the-sand syndrome.

I try to stick to presenting what I know, which is the facts and the economic theory behind things. If I'm sharing my opinion, I always try to preface it as such. My opinions are based on the fact, but in the end they are just my opinions. If you are skeptical of the source of the facts, then that is another issue. I am highly confident in their accuracy, however.

Now, just because I have a lot of working knowledge of the industry because of my involvment in it, doesn't mean I can't be of the opinion that we should move away from an oil based economy. That doesn't mean we should all live in straw huts and ride horse drawn buggies tomorrow. Obviously it is going to be a gradual transition from an oil-based economy, but it is a transition that will happen. How painful that transition is for us will depend on our willingness and desire to be part of the transition.

If we decide we'll just ride it out and not be part of the transition, then we will one day be hit with prices that make the current ones seem like peanuts, and we will have no means to combat it other than to face a major economic depression and take our lumps that way.

Or, we can begin the transition on our terms so that when the inevitable crunch comes, we will be prepared to weather the storm.

I've always said (on these forums, to my professional colleagues and clients, to my students, etc.) that this planet will never run out of oil. I say that not because it is plentiful, but because the laws of economics will dictate it. As demand outstrips supply, prices will only continue to rise. As this happens, our demand for oil will eventually be destroyed (replaced by alternatives), and a bunch of oil we neither want or need will be left sitting in the ground. "Exploiting what we have and then moving on" is not a realistic option, because that isn't the way things work. Changes like this require proactive thinking.

In the end, it all comes down to objectives, like I stated in the other thread. Personally I believe (my opinion) that making oil cheap is the wrong objective. Again, one of my favorite analogies is "you don't cure an addict by providing him with a bunch of cheap crack."

I guess the question should be: what is your objective?

that economic depression of which you speak is right around the corner. We've waited too long or just didn't have the knowledge to change things. Nevertheless, long-term we should move away from an oil based economy in favor of other more effecient means of energy, but for now we need oil. The transition of which you speak is 10-20 years away.

[Wild Cobra]

Yes, you did. You might want to read up on the associated Act as well.

OK, so I missed it. Again, can you point it out please. I saw the subject addressed, but not prohibited.

[RandomGuy]

"there is a moratorium on drilling in certain coastal areas. Other areas are not only open to drilling but leases and drilling permits have already been issued.

And they are not being drilled.


In fact, only 17% of the leased areas is in production. So, with about 33 million acres of offshore areas already available to drill and not being drilled, why does the oil and gas industry need to have access to still more? The fact is that nearly 25 BILLION barrels of oil off the coast of the United States is currently available for drilling...and industry is not drilling it.


Not to mention natural gas. Most of the natural gas occurring offshore (over 328 TRILLION cubic feet – an eleven year supply at current consumption rates) is currently available for leasing and development.
And they’re not going after it."


"It has been estimated that if all of those currently inactive leases were drilled, the USA would produce an additional 4.8 million barrels of oil and 44.7 billion cubic feet of natural gas EVERY DAY, accounting for a doubling of US oil production and a 75% increase in US natural gas production. The Minerals Management Service tells us that about 80% of fossil fuels available in offshore are currently available for development."



http://www.dailykos.com/storyonly/20.../614/81/537906


================


As always, dubya is lying about the "ban".

The reason for this is that there literally aren't enough deep-water drilling rigs in existance to tap it.

Every single rig that has been built to date is committed to a project, and the oil companies are screaming for more rigs.

Just another consequence of oil being cheap for a decade or so:

A lot of the companies that used to make rig equipment went out of business, so when demand picks back up, you have a lag in capacity.

scott can probably attest to this.

[boutons_]

Dearth of Ships Delays Drilling of Offshore Oil





"a shortage of ships used for deep-water offshore drilling promises to impede any rapid turnaround in oil exploration and supply."

"In recent years, this global shortage of drill-ships has created a critical bottleneck, frustrating energy company executives and constraining their ability to exploit known reserves or find new ones."

"the world’s existing drill-ships are booked solid for the next five years. Some oil companies have been forced to postpone exploration while waiting for a drilling rig"

http://www.nytimes.com/2008/06/19/bu...hp&oref=slogin


============

So there isn't really a need to end the moratorium, since there are 5M barrels/day of oil already leased and permitted, but the no hardware to drill with.

dubya's call to end the moratorium is total bull . It's a Repug giveaway to the oilcos as dubya winds up his disastrous terms.

Anybody think the US oilcos will sell their offshore oil to US consumers at a discount from world price?

Anybody think President Old Sick Senile 95% McFlopPanderKeating will vigorously collect lease royalties from oilcos? dubya surely hasn't.

The only people to benefit from drilling offshore are the oilcos, not the US consumers.

I expect the US/UK oilcos, if they can really, finally get started in Iraq courtesy of taxpayer debt and abused US military, will prefer to drill in Iraq for shallow, cheaper-to-extract, higher quality oil rather drill at the bottom of the sea.

[RandomGuy]

OK, so I missed it. Again, can you point it out please. I saw the subject addressed, but not prohibited.

Ah, the devil is indeed in the details.

It is not expressly prohibited.

BUT

It gives the authority provided by law to determine what is an acceptable risk of a spill to the EPA. (the "Administrator")

It also gives to various en ies, the authority to regulate various aspects of spill prevention equipment, and other things relating to it.

Without doing further research, I would imagine that the EPA then made the ruling of what an acceptable risk was, based on a panel that was created by this order, and using some data from the Exxon-Valdez spill that precipitated the law.

Presumedly, any current president, could simply reverse the delegation of authority to the EPA, and reserve that determination for himself.

[Wild Cobra]

OK Random, where does "prohibited" come in?

[boutons_]

"The projections in the OCS access case indicate 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.

And the impact of the projected 7% (!) increase in lower-48 oil production that might result in 2030 thanks to opening the OCS is … wait for it …

… any impact on average wellhead prices is expected to be insignificant."

http://climateprogress.org/2008/06/1...s-before-2030/


http://www.eia.doe.gov/oiaf/aeo/otheranalysis/ongr.html

[Wild Cobra]

[INDENT]"The projections in the OCS access case indicate 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.

Funny how they are limited to using the term "significant impact," isn't it. I can interpret that as educing the price to 2001 levels, or even back to $2.50 per gallon. The term does exclude small changes like 10% however. Then the 2030 number. That is probably the estimate of time to get all resources we know of on line, and the longer estimate ratrher than shorter. We don't need to bring them all on line to see an impact in price. Notice it doesn't give a time range.

This is what I call propaganda because it uses a concerted effort to use terminoilogy that confuses most people. It uses a long time duration, 2030, and doesn't quanitfy the guess of what the gas price would be. Probably because most people would appriciate how much the price would be reduced vs. if we did nothing.

Now also keep in mind, the material you linked is refering ONLY TO the outer (not inner) continental shelf of the continental 48 states. The 7% number is what we know of. If we can go there, you can be sure they will find even more.

[boutons_]

"This is what I call propaganda"

anti-oil proganda from dubya's own totally politicized DOE.gov?

"It uses a long time duration, 2030, and doesn't quanitfy the guess of what the gas price would be."

Let's hear your non-propaganda guess. I'm sure it's much more credible.

"refering ONLY TO the outer (not inner) continental shelf of the continental 48 states."

Well, that's where dubya wants to open the doors to the oilcos. Why isn't he asking for inner shelf exploration?

"If we can go there, you can be sure they will find even more."

really? how much? what will be the landed cost/barrel vs the world market price? Why aren't the oilcos drilling now where they are leased and permitted? When will it be in our fuel tanks?

And finally, the oilcos will NEVER give Americans a break on fuel prices, no matter if/when when the oilcos find cheaper oil. It would be illegal to do so, violate their charter, their commitment to shareholders, of maximizing profits. They will always charge the highest price they can, and the Americans, soldiers and taxpayers, who died and paid to bust the oilcos into Iraq.

[SonAta]

The soaring oil prices are affecting the costs of everything from food to gas. There are also significant issues on local and global environmental impact. While there are many issues, we need to look at our next leader and determine which will have the best course of action going forward…..I recently watch the two video in Pollclash about this issue, Obama and McCain talk about this…

[sabar]

We'll be fine.

[RandomGuy]

OK Random, where does "prohibited" come in?

That would be what the EPA did with the authority given by the President though the executive order, as I have previously explained.

If it really means that much to you, I'm sure you can find the ruling.

Your problem is that you don't acknowledge my vast undestanding of the law.

[xrayzebra]

Has anyone solved the energy problem yet? Obama said
if drilling for oil would lower cost he was for it, but since it wouldn't, forget drilling if he was elected President (Messiah) of the United States. Wonder how he is going to lower prices then. Will alternate fuels come on line and bring cost down? And old brutus, McCain, said offering 300 million for a new battery will solve problem, not in his and my lifetime, it wont. Being a dumb-ass must be what qualifies someone to be President. Cause both of those running now are true dyed in the wool dumb-asses.

[RandomGuy]

Has anyone solved the energy problem yet? Obama said
if drilling for oil would lower cost he was for it, but since it wouldn't, forget drilling if he was elected President (Messiah) of the United States. Wonder how he is going to lower prices then. Will alternate fuels come on line and bring cost down? And old brutus, McCain, said offering 300 million for a new battery will solve problem, not in his and my lifetime, it wont. Being a dumb-ass must be what qualifies someone to be President. Cause both of those running now are true dyed in the wool dumb-asses.

Will alternate fuel vehicles "bring costs down"?

No. They will not. No proponent will ever claim otherwise.

BUT

Over time, as the efficiency of renewables as an energy source surpasses that of oil, gasoline cars will simply not be economical. Pure, free-market economics.

It might not quite happen in your lifetime Ray, but it will in mine, and my grandchildren will wonder at the noisy, dirty museum peices that their grampa drove.

[boutons_]

"I read an article" that said getting the US auto fleet avg from 20 mpg today to 40 mpg by 2030 would save 5M barrels/day. Is that a worthwhile goal?

Mc95%'s $300M for a new battery is a total non-starter, like removing tax on gasoline to encourage consumption. McSenile is such a strong pro-environment guy.

[Wild Cobra]

That would be what the EPA did with the authority given by the President though the executive order, as I have previously explained.

If it really means that much to you, I'm sure you can find the ruling.

Your problem is that you don't acknowledge my vast undestanding of the law.

It sure would be nice if you expressed such things in an honest manner instead of through propaganda. So, am I right about this assessment. President Bush authorized the EPA to take the action, but he did not prohibit the action himself?

The way you said implies president Bush prohibited the drilling. That in effect is a lie.

To suggest president Bush prohibited it through the EPA is to say he is micromanaging it, and directed such actions. Now I ask this. To support the idea that president Bush prohibited the drilling, where is there evidence he directed the EPA to do so?