ENERGY

America ties destiny to natural resources

By Damon Cline

America’s preeminence in the world is partly due to its plentiful natural resources – and its ability to use them.

But never in American history has an administration made it so onerous and politically unpopular to tap its own wealth.

Under President Obama, the federal government fenced off vast swaths of the 28 percent of America’s land it owns from mining and exploration, regardless of its desolation or remoteness.

Meanwhile, his administration’s unrelenting pursuit of punitive regulations, high taxes and overzealous environmentalism slowed America’s ability to achieve energy self-sufficiency, forcing it to continue relying on foreign nations – including terrorist-supporting countries – for its fuel and mineral needs.

Even with America’s “energy renaissance” – driven by advances in drilling and extraction – the U.S. remains a net importer of petroleum products, as it has been since 1953.

The Trump administration says it is “committed to eliminating harmful and unnecessary policies” such as the Climate Action Plan – President Obama’s “global warming” treatise – and the Environmental Protection Agency’s “Waters of the United States” rule, which gives the agency authority over virtually all rivers, lakes and streams.

“Sound energy policy begins with the recognition that we have vast untapped domestic energy reserves right here in America,” the White House website says.

His administration is correct in its usage of “vast.” America’s oil- and natural gas-rich shale deposits could contain as much as 264 billion barrels – an amount larger than Saudi Arabia, Venezuela or Russia, according to a report issued last year by an independent Norwegian consulting firm, Rystad Energy.

ASSOCIATED PRESS
President Donald Trump signs an executive order in January advancing the development of the Keystone XL pipeline.

When the U.S. controls its energy destiny, consumers win.

The consumer price index has risen 12 percent since 2009, but gasoline and electricity are 43 percent and 31 percent lower, respectively. Instead of rationing and price spikes of the 1970s and ’80s, today’s consumers benefit from a rapid drop in prices that began in 2014 when U.S. production matched – and, for a few months, exceeded – Russia’s and Saudi Arabia’s.

Imports today account for a quarter of U.S. petroleum, down from 60 percent in 2006. Imports could fall to zero by 2028, the U.S. Energy Information Administration says.

The U.S. already is a net exporter of natural gas. Starting with the Barnett Shale play in Texas in 1997, the industry has grown from just 1 percent of domestic production in 2000 to more than 25 percent today, notes Peter Kaznacheev, a managing partner for London-based Khaznah Strategies Ltd., in a policy analysis for Cato Institute.

A similar “shale revolution” is happening in Canada’s oil sands, he said, further undermining the influence of the Organization of the Petroleum Exporting Countries, the global cartel whose members include Iran, Venezuela and Libya.

The EIA estimates shale gas will supply nearly half of America’s natural gas by 2035. Cheap natural gas and strident federal clean air regulations have caused American power producers to shift to cleaner burning natural gas, which helped U.S. carbon dioxide emissions drop to their lowest level in 20 years in 2012.

But coal, which also is used to make cement and steel, isn’t going away anytime soon. Many power plants have been outfitted with expensive “scrubbers” to strip carbon from emissions, and the U.S. still has nearly one-third of the world’s reserves.

Coal is declining as an electricity source, but is still used nine times more than heavily subsidized power from solar and wind plants.

Federal forecasts show an increase in renewable energy in the coming decades, but they will remain a small component of the overall electric generation industry, which depends on traditional hydroelectric, fossil fuels and nuclear energy to meet baseload and peak demands.

Nuclear, a powerful but politically maligned source of carbon-free electricity, is in the early stages of a comeback as new reactors are under construction near Augusta, Ga., and north of Columbia, S.C. Last year, federal regulators greenlighted two more near Gaffney, S.C.

But hamstringing nuclear’s expansion is Washington’s failure to deliver on a permanent repository for spent fuel, which remains highly radioactive for millennia.

The Obama administration, without citing technical or safety issues, halted construction on the Yucca Mountain repository in Nevada in 2009, forcing nuclear plants to continue storing waste in deep pools and above-ground casks.

The Nuclear Energy Institute notes taxpayers have paid more than $5 billion in damages to utility companies for Washington’s failure to abide by the Nuclear Waste Policy Act of 1982, which required a repository to be open by 1998.

“Damages could reach more than $29 billion by 2022 and up to $500 million annually after 2022,” the trade group said.

It’s time for a declaration of energy independence in America. We’ve got the power. Now we just need the willpower.

 
Damon Cline is business editor of ‘The Augusta Chronicle’ in Augusta, Ga.

CHALLENGES

More than half of land in the 11 resource-rich Western states is owned by the federal government, which has had a hands-off policy for mining and exploration under the Obama administration.
Concerns over carbon emissions – based primarily on long-term forecasts of models that have failed to accurately predict temperatures over the past two decades – have been more alarmist than reasonable, leading to dubious public policy, such as the obstruction of the Canada-to-U.S. Keystone XL pipeline project.
We’ve tried the central government approach, and it hasn’t worked: Of $10.7 billion doled out to 5,098 businesses for 31,540 renewable energy projects under the Obama administration, about 40 percent of the funding, $4.3 billion, went to 36 wind farms – and ‘The Wall Street Journal’ could only confirm about 7,200 jobs created, far short of the 100,000-plus claimed.

OPPORTUNITIES

Aside from Russia – which has twice the land mass – no other country is blessed with more land wealth than the U.S.
In addition to being a top five nation for natural gas, gold and copper, America has the most timber-producing acreage and nearly a third of the world’s coal. It also has major petroleum fields and sizable deposits of silver, aluminum ore, phosphates, potash, uranium and molybdenum.
Other than opening up federal lands to energy development, administrative and legislative actions should focus on repealing harmful executive orders and laws while depoliticizing federal agencies that declared bureaucratic warfare on certain industries during the previous administration.

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