Why Drillers Love the DRILL, DRILL, DRILL Mantra

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October 4, 2008

An interesting fact I discovered online somewhere (I don’t remember just where) is that in the breakdown of gasoline at a retail price of less than $3 gallon, the producer (driller) keeps 95 cents. No wonder exploration and drilling companies want to open up as many new fields and grab as many leases as they can. It probably makes good economic sense to them to get the leases first (as well as any controversial area leases they can obtain due to a temporary panic in the economy due to either oil shortages or price spikes), then sit on most of them and not drill until (1) they extract the oil from the easiest, most economical, and most profitable fields first, and (2) then in the future when new technologies emerge for extracting the more challenging oil fields, like oil shale, where they are betting that oil will rise to such a high price that drilling for oil almost anywhere will be profitable–and they will already hold the leases. (Gary, one of the commenters on one of my blogs points out that it still takes more energy to extract oil from shale than the energy they derive from it.)

So would oil companies want to encourage or even invest in alternative energy development since as the new sources of energy reach markets and prices come down it will result in a lowered demand for oil, falling oil prices, and a continually reducing oil market? I don’t have to be a petroleum engineer to figure that one out.

Even if the price of oil decreases–for whatever reason: new discoveries, international decreased oil usage through conservation, increased oil releases from OPEC–the temptation to drop the continued development of alternative energy solutions now that fuel was cheap again–would be a destructive mistake to the environment, causing another spike in CO2 releases, faster paced global warming, reduced air quality, etc.

The search for Alternative energy solutions cannot slow down, no matter what the price of oil, and in fact, need to be ramped up even more, if we are to prevent even worse relationships with oil producing nations that hold us hostage to their black gold and climate change conditions that scientists warn us are probable.

A final note. I am currently and happily visiting my four home-schooled granddaughters (ages 4 to 11) in Lebanon, Connecticut. My wife, Lynn, and I will be here for ten days for a visit that we are, unfortunately, not able to make often enough. I will be spending my time reading about red barns and green trees, talking spiders and pretty princesses, correcting math papers and playing horsy, and attending numerous soccer games–all those great services that grandpas are so fortunate to be able to provide. Grandchildren do have a tendency to consume all one’s time—and energy. Whew! Though I will be unable to answer all your comments as I have in the past, I will read them all and return to my usual response time following granddaughter time.

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  1. R W Bennett

    Boys forget politic your getting all heated up for nothing. First of all if you guys would keep up with the news, big oil company are investing big time into cleaner energy , spending millions.

    Stop and think about it, we should have started drilling for more oil back in the early ninety if not before. Drilling for oil is a lot like starting a ball game, if you don’t start the game you can’t finish, the same goes for drilling for oil. Hey let face it we need all the oil we can get now, and keep working on other clean energy as fast as we can. Say one day China and India makes a deal with the oil countries and American come up short and some of you folks well say all my God let’s DRILL, to late!

    Business back in the 70’s turned off there big business sign at nite to save on oil why not do it now!

    For you folks may or may not know by using ETHANOL in our GAS you lose about 2 to 3 miles to the gallon, you can thank our boys on CAPITAL HILL!

    In this world today any thing can happy so lets not get caught with our pants down, beside that, it’s to cold out side. Ha

    Oil company makes about 6% profit. Look at other business and compare!

    Good Nite

    R W

  2. Bob Difley

    Ken – I will attempt to provide below what I think you are referring to as “broad unsubstianted statements and personal attacks”.
    First, BP will spend $8 billion on alternative energy over 10 years–800 million/year–out of a $15 billion R&D budget, about 5.3%,. That also includes, however, the money they spend on natural gas development, which I wouldn’t call alternative energy since it is, as is oil, a fossil fuel. Then there is their $9 billion second quarter earnings (profits after all the bills are paid). That, by most standards, is a small percentage of their available funds, even though the amount ($800 million) sounds like a lot. You can verify this information on their Web site.
    Secondly, ExxonMobil reported $11.7 billion in profits for the second quarter of 2008, yet spent only 1 percent of its profits last year on alternative energy. They spent more in buying back their own stock ($8.8 billion) than on investments in alternative energy. These figures are verifiable from EM’s Web site.
    Thirdly, you can read the facts on California’s Proposition 87 at: http://en.wikipedia.org/wiki/California_Proposition_87_(2006)
    Lastly, the renewable tax credits just approved by the senate–$18 billion—range from extending wind credits for one year to solar credits for 8 yrs. Funding is to come partially from closing oil company tax loopholes. (Note here that the number and complexity of tax loopholes that lobbyists have pushed through congress over the years to benefit oil companies are not available to alternative energy companies. Also, subsidies do not expire [oil companies have subsidies], but since tax credits and incentives do expire, alternative energy entrepreneurs cannot plan for the long term [note the one year extension for wind energy tax credits] which then discourages long term investment programs as well as serious amounts. You can read this in detail in Tom Friedman’s new book, Hot, Flat, and Crowded specifically on pages 375-380.
    As far as the “personal attacks” you refer to, is it the part where I say “And you Ken, need to read other sources of information about the oil industry and clean energy, not just those sources that support your views.” I apologize if you interpreted my suggestion as a personal attack, it was not meant as one. But I will still make the same suggestion. And if you point out what you refer to as my “politically biased response” I would be glad to reply to that also.
    With that said, as far as your original request that I “retract my original statement”, how about if I back off it to something we might both possibly agree to? See text below with the changes in ALL CAPS. If you agree I will change it in the blog.
    “So would oil companies want to encourage or even invest A SUBSTANTIAL PORTION OF THEIR AFTER TAX PROFITS OR THEIR RESEARCH & DEVELOPMENT BUDGETS in alternative energy development since as the new sources of energy reach markets and prices come down it will result in a lowered demand for oil, falling oil prices, and a continually reducing oil market THAT ACCOUNTS FOR THE BULK OF THEIR PROFITS? I don’t have to be a petroleum engineer to figure that one out.”
    I will acknowledge, however, that we can expect oil company investments in alternative energy to increase, since by all accounts the alternative energy ball is rolling, and they are in business to make money—whether by oil or by alternative energy—and will be poised to move when the circumstances are right. But they will not be able to make the profits from alternative energy that they make from oil.

  3. Bob Difley

    Larry J. Guthrie says, “Since you preface your article on this statement why don’t you at least find out if it’s true.” I haven’t found out whether it’s true, and in fact it may be different for every oil company, but the information is from a Web site by Gibson Consulting: http://www.gravmag.com/oil.html titled “Some Interesting Oil Industry Statistics.” Scroll down to the bottom, then come up until you see the title, “Costs to produce and sell a gallon of gasoline in the US,” and on the left side of the page down a ways from the title is a blue box, in which you find the category, “Producer’s cost.”
    If you find any different figures, I would be interested in seeing them.

  4. Larry J. Guthrie

    “An interesting fact I discovered online somewhere (I don’t remember just where) is that in the breakdown of gasoline at a retail price of less than $3 gallon, the producer (driller) keeps 95 cents.”

    Since you preface your article on this statement why don’t you at least find out if it’s true. How can you in good conscience criticize a group of people by citing a line that you have no idea whether it’s true or not.



  5. Ken Armstrong

    Sorry Bob, my mistake. I thought that if I stuck to facts we could have a dialog. I can’t (won’t) compete with broad unsubstianted statements and personal attacks.

    That was a very politically biased response you gave. We get enough of that on the news lately. How about getting back to sharing information pertinent to RVs?

  6. Bob Difley

    Ken – Yes, BP is in the solar business. In fact, they are one of the four largest producers of solar panels in the world. That’s smart business. It’s also hedging their bets–oil is still their big profit-maker. (The grand total of alternative energy spending in America is minescule compared to oil). Exxon Mobil also is dabbling with alternative energy as I’m sure all the other oil companies are also. They know that if the right congress gets elected and the right president enters the White House, the tide could turn for big oil with big subsidies and tax breaks for clean energy development–and they want to be in place to receive some of them, especially for the infrastructure (over 170,000 gas stations in the US) they already have that could dispense battery charging for electric vehicles. While this administration has continually supported subsidies for big oil it has on the other hand refused to grant subsidies for the development of alternative energy, which has kept oil profits in the stratosphere, produced global warming from the burning of gasoline, and kept clean energy as a second rate resource. Not only that, but Big Oil spent a reported $100 million dollars in 2007 to defeat California’s Proposition 89, an initiative to establish a $4 billion Clean Alternative Energy Program to reduce California’s oil and gasoline consumption by 25% through incentives for alternative energy, education, and training. The intentionally mis-leading advertising campaign told voters that the bill would cause prices to go up at the pump. The proposition was defeated and the price of gasoline has gone up every since. There are lots of examples, like this one, of how big oil has sought to defeat the development of alternative energy and discourage the government from granting subsidies or tax breaks for clean energy developers. And you Ken, need to read other sources of information about the oil industry and clean energy, not just those sources that support your views.

  7. Ken Armstrong

    Bob, you said “So would oil companies want to encourage or even invest in alternative energy development since as the new sources of energy reach markets and prices come down it will result in a lowered demand for oil, falling oil prices, and a continually reducing oil market? I don’t have to be a petroleum engineer to figure that one out.”

    I guess this is what occurs when the public is schooled by politicians and the media. We have all learned to expect them to be reckless with the facts. While it may be politically correct in this day and age to speak ill of oil companies, it’s not necessarily correct. Following is a link to BP.com (British Petroleum). I think you’ll be very interested in seeing what they are doing in solar, wind, hydrogen, biofuels, and gas powered plants.

    FYI, BP is the third largest public oil company in the world, the leading gas producer in North America, as well as one of the major producers of solar cells in the world. After you have read what they are doing as an “energy company” instead of simply an “oil company”, a.k.a. “Big Oil”, I hope you find it appropriate to retract your original statement I quoted at the beginning of this note.

    Thanks for caring……

  8. Robert Grant

    Like some of the others that have posted, we appear to have very different views on this topic and it seems like a waste of time to argue back and forth. I think that we should probably stay away from politics, religion (and now) global warming as a topic on these forums.

  9. bob difley

    Robert Grant says, “this stuff doesn’t belong in an RV blog and the blog should be terminated.”
    Robert – Why would you feel this doesn’t belong. The fuel crisis and global warming arguably affect RVers as much or more than anyone. Our rigs take more fuel than sutomobiles to move from place to place, and we contribute to Global Warming through CO2 emissions from our burning of gasoline and diesel. Unless we confront issues like this on RV.net, discuss the issues, and look for ways to ease the problems, then some gpvermemt agency will likely come along and target us for our poor mpg and and CO2 emissions. The fact is, this is the very type of issue we can and should discuss so we can work out our own problems before others impose unwanted restrictive restrictions on us.

  10. bob difley

    Gary – The way we all learn is to post an opinion for your peers to read and comment on. The give and take in following up on what others say broadens one’s own views and opinions and serves to strengthen or weaken them. It’s hw we all learn. It doesn’t accomplish this when one person makes statements then says they won’t respond any more, so that rebuttal or confirmation of that person’s ideas goes unanswered. But thanks for comparing me to a Pulitzer Prize winner. Bob

  11. Robert Grant

    IMO this stuff doesn’t belong in an RV blog and the blog should be terminated.

  12. Gary Hauck

    Bob, have fun with your blog. I am not going to pursue this any more.Just tell the Rv’rs to park their rigs and the population not to travel on vacations so they wont contribute to global warming. You and Al gore have a lot in common. I will not be reading any more of your blogs when posted on this RV net site. So there is no reason to continue to send me personal emails also.

  13. bob difley

    Gary – You mentioned the name Kevin Trenberth as one of the signers of the Oregon Petition (of which I have a problem, since they will not provide transparency as to who the people who are signing the petition really are, and what their expertise is. I do know that only about a third have PhDs and and an even smaller number have doctorates in climate science). Is he the same Dr. Kevin Trenberth that is head of the Climate Analysis Section at the National Center for Atmospheric Research? If so, he was a lead author of the 2001 and 2007 IPCC Scientific Assessment of Climate Change, which states:

    The latest 2001 Intergovernmental Panel on Climate Change (IPCC) report reaffirms in much stronger language that the climate is changing in ways that cannot be accounted for by natural variability and that “global warming” is happening. Global mean temperatures have risen and the last decade is the warmest on record. The major cause of warming in the last three decades is from human effects changing the composition of the atmosphere primarily through use of fossil fuels. While changes in particulate pollution mostly causes cooling, increases in long-lived greenhouse gases dominate and cause warming. The long lifetime of several greenhouse gases (carbon dioxide lasts for over a century) suggests that we can not stop the changes, although we can slow them down. Moreover, the slow response of the oceans to warming, means that we have not yet seen all of the climate change we are already committed to. Major climate changes are projected under all likely scenarios of the future and the rates of change are much greater than occur naturally, and so are likely to be disruptive.

    Read more at: http://en.wikipedia.org/wiki/Kevin_Trenberth

  14. bob difley

    Gary – Thanks for your response. A lot to think about, but you mention a lot of figures that I am not familiar with. I will research them and reply later (when I finish my visit with my granddaughters and return to the keyboard, sometime next week). But I do recall Dr. Christy being a contrarian. He is a member of the American Geophysical Union, an organization of geophysicists consisting of aboaut 50,000 members in 135 countries. The AGU issued a position statement on climate change in December 2003 and revised and reaffirmed the statement in 2007. The revised statement begins:

    “The Earth’s climate is now clearly out of balance and is warming. Many components of the climate system–including the temperatures of the atmosphere, land and ocean, the extent of sea ice and mountain glaciers, the sea level, the distribution of precipitation, and the length of seasons–are now changing at rates and in patterns that are not natural and are best explained by the increased atmospheric abundances of greenhouse gases and aerosols generated by human activity during the 20th century.”
    The statement was drafted by Marvin Geller, John Christy and Ellen Druffel and revised and reaffirmed by the AGU Council.
    Maybe he too is changing his position.

  15. Gary Hauck

    PS I forgot to mention this was taken from the Science Journal. Gary

  16. Gary Hauck

    Bob I think you showed your true colors when you metioned fox news. Over half of the scientists who were asked to research the global warming theory say that all the facts were not taken into consideration. Dr John Christy UAH/Nasa, stated Atmospheric cabon dixoide levels, currently only 350 parts per million have been over 18 times higher in the past at a time when cars, factories and power stations did not exist. Levels rise and fall with out mankinds help. 96% of all carbon dioxide emissions are from natural resources, mankind is responsible for only 3.5%, with 0.06% comming from fuel to move vehicles, and 1% from fuel to heat buildings. Both water vapor and methane are far more powerful green house gasses than carbon dioxide but they are ignored. It goes on in the article that over 18000 signatures from scientists worldwide on a petition called The Oregon Petition. The petition which sates there is no evidence for man made global warming theory nor any impact from mankinds activities on climate. Dr Christy also reported that the scenarios with the fastedwarming rates were added to the IPCC report at a late stage at the reuest of the governments. In other words they were told what to do. Below is a very partial list of names tht signed the petition, as 18000 names are a lot. Kevin Trenberth-Climate Scientist, Kerry Emannel-Meteoroligist, Chris Landse-Metorologist, Timothy F, Ball-Professor of Georgraphy, Robert M Carter -Geologist, Hendrick Tennekes- Royal Netherlans Meteorological Institute, Sallie Baliunas-Harvard-Smithsonian Center for Astrophysics. Bob I trust the scientists… Gary

  17. bob difley

    Gary – Global Warming is a natural cycle just as global cooling is. It is a natural cycle between ice ages and the gradual warming following an ice age until the earth reaches a certain point then reverses itself and begins cooling down toward the next ice age. This period covers about 100,000 years. No scientist disagrees with that. The problem is that man-caused actions (burning fossil fuels for instance) is causing a warming trend that is faster than ever before, and that carbon dioxide (CO2) in the atmosphere has built up to about 384 ppm, compared to 280 ppm where the CO2 level has been for the last 20 million years–and is still rising at an alarming rate. Since humans have never before in history or pre-history lived in an atmosphere so high in CO2 it is hard to state unequivically without doubt what will happen. However, a lot of very bright, well educated climate scientists around the world have made as accurate a guess as they can and come to as close an agreement as they can on what the ramificatins will be–and their projection is not that of a world we would like to live in. Do you want to bet the lives of your grandchildren on the small minority that say man-made global warming is not happening, or that it is no big deal? I would much rather go with the scientists–who know a whole lot more than I do about what might happen–than bet my grandchildren’s liveson some talking head denier on Fox or the cable channels with no education in climate science. But that’s just me.

  18. Gary Hauck

    I would like to add we have a couple of wind farms in Kansas, about 9 or 10 to a farm. When ever something comes up for Governor signing, like clean coal facility or large wind farms she veto’s them.

  19. Gary Hauck

    This last spring the National geologial society and NOAA published a paper stating that the ice shelf that is used to determine global warming actually grew two inches. I saw the article on newsmax. why isnt that ever brought up, I think that it would show that the global warming isnt what a certain few are advocating. The federal money would be pulled and these scientists would not be getting their grants.10,000 years ago the earth was covered with ice and started melting and guess what, you talk about global warming and there were no cars, large populations of people etc. What do you blame that on.Some poor cave dweller who started a fire to keep warm or cook his dinner.

  20. Jim Burnett says about drilling for more oil, “it will not substantially reduce prices or American dependence of imported oil.”
    The part that really bugs me is that we are sending $700 billion a year into foreign economies, much of it to OPEC countries that detest us and would like to see us fail. If nothing else, that money should start flowing into this country’s entrepreneurs to develop alternate sources of energy that do not add to climate change. That’s a lot of money to work with. And where there is the money, the development follows. And it’s good for the American economy, the climate, jobs . . WIN WIN all around.

  21. William says, “I also say “Drill, Drill, Drill.”
    Thanks for your comments. The problem with the DRILL, DRILL, DRILL program is that it won’t change the price at the pump for years, and then we will still have climate polluting CO2 from using it to deal with. Let’s put the efforts into clean energy, which I’d rather find accomplished in ten years than more oil in ten years.

  22. Ken said, “I disagree passionately with Joe Biden when he says of ‘climate change’, “Well, I think it is manmade. I think it’s clearly manmade.”
    I hope Biden was just trying to not take as hard a line on the subject as many deniers take, acting as if the evidence against global warming is so obvious that anyone who disagrees is an idiot. Another thing that has to happen is that the government has to step up to the plate and become totally committed to alternate energy resource development, so that private money and investors have some confidence that a market will be there if they are to invest billions of dollars in development. With the recent government’s lack of will or committment to clean energy, what investor would want to invest big if he felt the government would suddenly cut off alternate energy subsidies or tax breaks to homeowners and businesses that convert to green power and instead continue to grant subsidies to dirty power like coal and oil companies?

  23. Glenn – Be careful not to go to the extreme ends of the issue. If we all reduced our gasoline usage, make fewer trips to the mall, stay longer in campgrounds before moving on, and drive at 55 mph, we would not have to “park our cars, trucks, and RVs.” The amount of gasoline and diesel we would save just from being more conservative in its use, would save millions of barrels of oil, which would reduce the amount of oil we would have to imprt from OPEC, keep more of the $700 billion we spend on foreigh oil at home, and give the alternative energy sources time to grow.

  24. Glenn

    Have you ever drilled an oil well? You would not get me on the platform for less than $40K and it takes at least four drillers per shift, 24 hour days. What is your recommendation for right now? Park our cars, trucks, and RV’s? Without petroleum products we (the retired) go no where. What a wonderful retirement. I want everyone to realize that government (both parties) sat on the problem for over 30 years and now everyone is turning green. Why now? Because it is the “thing to do” no matter the cost to the little guy and gal. I cannot afford to sell my truck because I cannot afford to buy “green.” so unless we do “all of the above” and that includes drill now we all stay home, walk or ride a horse – hello 1900.

  25. Don

    If we don’t develop alternate renewable forms of energy and continue our dependence on fossil fuels, we will be committing national suicide. We’re buying foreign oil with borrowed money. The current situation on Wall Street is just the tip of the iceberg when it comes to our financial woes. We’re printing money with nothing behind it. At some point, the world will tire of accepting worthless dollars. We’ll be a bankrupt nation with nothing to trade for goods and services.

    There are about 300 Million people in the United States. India’s population is 1.2 Billion (about 4 times the size of the US). China has about 3 Billion people (about 100 times the size of the US). As the populations of these countries become more effluent (remember, they’re producing all the goods and services we use), their energy demands have the capacity to far out-pace ours. Oil production world wide has passed it’s prime. Oil is going to become more and more expensive as the demand for it grows. Becoming energy independent is in our country’s best interest and should be extremely high on our list of priorities. Time is running out for us!

    The Pickens Plan is a good starting point. It does at least two important things – create new jobs in this country and reduce our need to import oil. Every drop of foreign oil we supplant with domestic renewable energy strengthens our national security.

    The points Mr Pickens makes are valid – “America is in a hole and it’s getting deeper every day. We import 70% of our oil at a cost of $700 billion a year – four times the annual cost of the Iraq war. I’ve been an oil man all my life, but this is one emergency we can’t drill our way out of. But if we create a new renewable energy network, we can break our addiction to foreign oil. On January 20, 2009, a new President gets sworn in. If we’re organized, we can convince Congress to make major changes towards cleaner, cheaper and domestic energy resources. To get this done, I need your help. Check out the plan.” (http://www.pickensplan.com) This is a plan we should all be supporting. I can’t understand why we aren’t proceeding at full speed with it already.

    Devoting our efforts to developing alternate renewable forms of energy won’t replace all our needs for oil but, it will begin to replace some of the oil we use and it will put Americans to work doing it. It’s a win-win situation and a task we are way overdue at getting underway.

    The clock is ticking – it’s time for action. Drilling will NEVER – EVER get us out of this mess! Big Oil has diverted us from this task for way too long. It’s time we stopped listening to them and started thinking of our nation’s future, our children’s future and their children’s future.

    Stop all this BS about I want “MY” oil now so let’s start drilling right here and everywhere. That’s not going to achieve the desired results.

  26. TXBrad

    Bob: I get 20+ % of the Gas I sit on. (Some folks getting 25+%) of the price ( wholesale market price as shown in daily paper) that someone like Oklahoma Natural Gas pays . [ ONG moves it, processes it, etc. & sells to a home owner. They meter it, bills folks, repairs lines, meters etc. ]
    Drillers get paid X$ day for equipment, crews, chemicals, etc….. Price has gone up as supply of rigs vrs demand. Form the time an ” OilGas Co.” leases a site & leases w/ owners of Gasoil mineral rights; they hae 3 some 5 years to sink a bit. or release again. The ” Oil company” gets the balance 75 – 80 % of again wholesale price .
    They pay the “driller” , gelogists, drill site leases, Fracture costs ( opening the shale so gas flows out) water removal ( gas comes up w water) , costs to build pipe lines, compressor stations, and 100’s Admin. people ( get & sign leases, permits, check land titles, + all local, state & fed. paper, mail checks to drillers to gas owners bill , meter gas to wholesalers.
    Sure the ” oil Gas co. makes good money. Driller Co. make money, but labor & materials , support costs are high. A drill site is 24-7 operation and the crew live & eat on site ! Time off is when others come in & take down & move rig. Excellent site pay. The barnet shale-gas added 25,000 + new jobs in Ft. Worth area.
    That is how I see it here. I have 3 wells across the street & ours comes from 5 wells 3 blocks away TX Brad

  27. Phil Welch

    Excellent piece. I would suggest you take those grandchildern out West as fast as you can as the natural sites are being replaced with drilling rigs and trash. Please look at Oct. issue of Outside, Code Green; The Price is Wrong.
    I was unaware of the unprecedented amount of land the Bush administration was opening to oil and gas leasing until I read this article. with ths administration, 44 million acres of federal land were under lease, the equivalent of 20 Yellowstones! Ane they want more!
    The article does call for a mix of energy sources as well as changes in usage, not what the people want to hear or subscribe to. If we are to leave our childern, and grandchildern, a sustainable environment in harmoney with nature, we must make difficult choices. We can not live on debt, easy credit, or plunder the resources

  28. Bob –

    Good comments. I’d suggest that a combination of new technology, conservation and smart development of domestic reserves will be needed to help reduce our dependence on imports.

    Here’s an interesting take from a recent editorial in the Austin American-Statesman, in heart of pro-oil Texas, discussing recent lifting of the off-shore drilling ban:

    “…the GOP drilling victory likely will soon be forgotten: It was oversold in the first place.”…while new production will be helpful, it will not substantially reduce prices or American dependence of imported oil.”

    “…So while the GOP can claim a political victory on the drilling ban, it will be years if ever before that victory actually does anything for the American people. … let’s not kid ourselves that more drilling will solve our energy problems. It won’t.”

    Not a very optimistic take on the situation, but if it’s accurate, certainly reason to continue to work full-speed ahead on other options to supplement oil.

    There is a new reason to feel positive about wind. The state of Rhode Island has announced plans for an offshore wind farm expected to provide about 1.3 million megawatt-hours a year – about 15 percent of the state’s electricity.

    The company selected for the project, called Deepwater, pledged to invest about $1.5 billion with the construction of a regional manufacturing facility, which would creating up to 800 direct jobs with annual wages of $60 million.

    Those are some positive numbers for both economic growth and power production. After this announcement, other companies have expressed interest in similar projects off the East Coast. Proposed sites are far enough offshore to minimize concerns about visual “intrusions” – another plus is that the wind blows stronger and more reliably than on land.

  29. George Wharton

    We can drill on shore or offshore as fast as you want. My question is, where are we going to process it. We can drill anywhere relatively fast, but we sure as hell can’t build more refineries fast.

    In the short term, the only thing that is going to work, is the T Boone Picken’s plan to use natural gas and alternate energy sources.

  30. William Green

    For our cars and RVs the alternate energy choices, as I know them, are ethanol, biodiesel, various hybrids, natural gas, petroleum gas and electric. These are all good choices and should be pursued. But I don’t think we have any of these in sufficient quantities to replace oil completely. Until we do, or until better choices are available, we have to choose between foreign and domestic oil. I know people will get rich from drilling off-shore, but at least it’s domestic oil! At least it will be Americans and Canadians getting rich. Jobs will be created.

    Wind energy for electric use is technology we already have, but the plan, as I last saw it, was for “20% Wind Energy by 2030”. Even technology we have now seems to take over 20 years to implement. I also say “Drill, Drill, Drill”, but at the same time spend loads of money on alternate energy to see which are viable. From what I have read, I don’t see anthing that will completely replace oil. At least for now.

  31. Ken

    I disagree passionately with Joe Biden when he says of ‘climate change’, “Well, I think it is manmade. I think it’s clearly manmade.” While anthropomorphic warming is a factor, however small, economics will ultimately set the speed at which alternative energy is developed. The interesting fact you discovered was no surprise to you, I’d venture, nor should it be to anyone — no matter what widget you are selling, when it is great demand, you want to get as many to sell as possible. Government plays a pivotal role here. For (one very simple) example, In the ‘short’ term, nuclear is ahead by magnitudes in QUANTITY comparisons even as a transitional alternative, but investment is, at best, exraordinarily risky in light of the regulations that govern and will govern the industry.