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End the Green Nightmare

by Gary Jason  |
Posted November 16, 2011

There is currently a maelstrom of news about costly failures in the so-called
green energy industry. Of course, solar power is prominently featured, and the
Solyndra fiasco is only one of the scandals. Rapidly rising to public
consciousness is another crony capitalist solar
company, SunPower, which looks like it too will go bust and cost the
American taxpayer a fortune. Also in this club
of losers are solar companies such as First Solar and Abengoa, both again
the recipients of taxpayer dollars, thanks to the current administration’s rigid
environmentalist ideological mindset.

But not to be overlooked are disappointments in the other segments of the
green energy industry. Corn-based ethanol has proven to be such a wasteful
boondoggle that even Al
Gore has rethought his support of it. And wind power has come in for a good deal of scrutiny. Why, even geothermal companies
are proving
questionable. A recent report of three on the biggest such companies —
Nevada Geothermal Power, Raser Technologies, and U.S. Geothermal — shows that
they are all in financial difficulty or are just not profitable. All are
recipients all of taxpayer loans or loan guarantees.

This has left the proponents of green power trying desperately to explain
away its dismal failure — both here and abroad — to prove itself commercially
viable without massive governmental subsidization, and without the corruption
that governmental subsidies typically bring. But while we are witnessing the
bursting of the Great Green Energy Bubble, we are also witnessing a renaissance
of fossil fuels — the very fuels that Malthusian prophets of doom have for
decades claimed are “running out.”

This renaissance has been caused by a technological revolution that is
transforming oil and gas drilling. Because of it, oil and gas are far more
plentiful here and in countries outside the Middle East and other hostile
neighborhoods, such as Russia and Venezuela. I am thinking especially of two
technologies, fracking and horizontal drilling. The rebirth of fossil fuel
production was unimaginable a few years ago. It is completely beyond the ken of
the Greens who constitute the Obama Regime, people who never anticipate
revolutions that are not run from above, by them, but instead originate in the
distributed intelligence of regular (read: creative) people.

We are also witnessing a renaissance of fossil fuels — the very fuels that
Malthusian prophets of doom have for decades claimed are “running
out.”

Start with fracking. It
has certainly made some energy companies rich. For, example, Noble Energy has
just paid a whopping
$3.4 billion for a half-interest in the Marcellus Shale holdings of Consol
Energy. Together they plan to develop a huge chunk of Pennsylvania and West
Virginia (663,000 acres). Even after selling off half its holdings, Consol still
expects to extract a massive 350 billion cubic feet of gas.

What is fascinating is that Conrol Energy is a Pennsylvania-based coal
company — you know, one of those, well, fossils of the fossil fuel industry. It
is nicely positioning itself for the inevitable shutting down of coal-fired
power plants under the relentless pressure of the EPA. Consol and Noble are just
two of the flood of companies moving in to develop the Marcellus Shale
formation.

Fracking is also rewarding key players in the industry. Marcus Rowland, the
CEO of the small but important player, Frac Tech International, earned a tidy $24.4
million last year. His compensation made him the highest paid CEO of any
publicly-traded energy company. He is paid more than the CEO of IBM.

Frac Tech is beating many other energy companies by providing hydraulic
fracturing services for big energy companies such as Chesapeake Energy and
ExxonMobil. It brought in nearly $1.3 billion in revenues. In the world of
fracking, only Halliburton and Schlumberger are bigger.

There is a very recent report about the development of a shale field of truly
stupefying proportions. The Utica Shale deposit is an enormous geological
formation stretching from Quebec to Kentucky. It may be an even more fertile
source for oil and gas than the Marcellus Shale field. Ohio state geologists — a
neutral source, please note — estimate that Ohio’s share of this field
holds upwards of 15 trillion cubic feet of natural gas and 5.5 billion barrels
of recoverable oil (or roughly a third of the production of America’s largest
oil reserve, Alaska’s Prudhoe Bay).

Then there is brilliant article discussing one
of the unsung creative geniuses of American industry, Harold Hamm. In a week
dominated by paeans to the fallen Steve Jobs — who rightly deserved recognition
for his amazing success in making Apple what it is — it was nice to see a piece
on the remarkable Mr. Hamm.

Far from welcoming the renaissance of the American fossil fuel industry and
the jobs it would provide, the Obama Regime has fought it tooth and
nail.

Hamm is the founder and CEO of Continental Resources. He rose from humble
origins — the thirteenth child of Oklahoma sharecroppers — to become
thirty-third on the current Forbes list of wealthy Americans. Yes, Virginia,
there is a Horatio Alger. Hamm is almost certainly going to rise to a much
higher place on the list, given how much oil he owns.

He made his early success as a wildcatter with a keen sense of where oil
could be found. But his greatest contribution was his early employment and
improvement of a second innovative fossil fuel technology, a method called
horizontal drilling. This is a technique whereby the drilling company drills
downward (up to two miles deep), then drills outward, horizontally. This
technology has — as dramatically as fracking — allowed energy companies to
exploit petroleum and gas reserves hitherto not commercially viable.

Hamm is the discoverer of the famous Bakken oil field that extends from
Montana to North Dakota. So fertile has this field proven that it has helped put
America back in third place in the world in oil production. He estimates the
reserves in Bakken alone at 24 billion barrels — which if true is
double our currently proven national reserves. Continental has seen its
proven reserves go from 118 million barrels in 2000 to 421 million
barrels this year.

One might expect that the Obama Administration would be delighted at the
prospects of America’s becoming energy independent — and potentially millions of
American blue-collar workers getting high-paying jobs.

But one would be wrong.

Far from welcoming the renaissance of the American fossil fuel industry, the
Obama Regime has fought it tooth and nail. It is attacking shale oil and gas
with every tool at its disposal. Its Department of the Interior has undertaken a
jihad against them. It has locked away from exploration and development vast new
areas of the Midwest and has waged a war against conventional offshore drilling.
It is now doing its best to stop the new technological drilling, even in lands
that have been drilled conventionally before.

The Green Regime’s SEC has entered the fray, demanding that companies like
Continental follow new Sarbanes-Oxley requirements about reporting royalty and
production figures, meaning that CEOs like Hamm face jail time if some low-level
operator misreports production from a field.

Ironically, the feds never apply Sarbanes-Oxley to themselves. If Obama or
any of his administration misreports taxpayer liabilities, say, for solar
industry loans, nobody faces any consequences.

In addition, the Regime is pushing de facto tax increases for the
oil and gas industry, by ending various tax credits the oil industry has long
enjoyed. This — coming from an administration lavish in its subsidies to minor
and expensive energy sources such as solar, wind, geothermal, and ethanol — is
from the point of view of physical science simply bizarre.

Finally, the Green Dream Team has brought its Justice Department into the
jihad. It recently brought charges against seven oil companies in North Dakota
for killing 28 birds. Continental has been accused of killing — one bird! But
this is not a minor matter: the executives face six months in jail if convicted.
(Note: The same Justice Department has never even once pursued any American wind
power company, even though American wind power facilities kill on the order of
half a million birds a year.)

But even as the Regime wages its jihad against domestic fossil fuel
industries, other countries are moving ahead with the new fossil fuel
technologies. As I noted in an earlier piece, Israel has set about using fracking to free itself from reliance on
foreign sources of oil, which would mean changing the balance of power in the
Middle East. Israel is using fracking to exploit some major fields, the most
recent being a field (named “Leviathan”) which holds 16 trillion cubic feet of
natural gas, or about a century’s worth of gas at Israel’s current usage. This
field is only part of the massive Levant Basin shale field, which holds upwards
of 122 trillion cubic feet of natural gas, or about eight centuries’
worth.

More recently, a small energy player in the UK has announced that the Bowland
Shale field, in northwest England, contains an estimated 200
trillion cubic feet of natural gas. This estimate (by Cuadrilla Resources)
means that this one shale field contains enough natural gas for two-thirds of a
century of the UK’s needs at present levels. And that is only one field.

The British boom is being echoed elsewhere in Europe, where other countries
are also turning to fracked gas — except France, which has outlawed shale gas
exploration altogether, one suspects to protect its nuclear industry from
competition. But Poland, for instance, has an estimated 187 trillion cubic feet
of shale gas. This is geopolitically game-changing, considering that Poland now
has to import its natural gas from neighboring Russia, a country that
historically has kept trying to incorporate Poland into its empire.

Note the extremism of Banks’ demand: don’t even explore, much less
try to use, resources until they are proven, to her ilk, to be perfectly
safe—something that will never happen.

This discovery in the UK comes just in time to stop its increasing dependence
on natural gas from the Middle East and Norway. But — naturally — the British
energy suppliers are facing the same kneejerk environmentalist opposition that
Hamm and other American suppliers do. Soi-disant environmentalists in Britain
are roused in furious opposition. Jenny Banks, the “energy policy officer” for
the environmentalist group WWF (World Wildlife Fund) demands, “The government
should at the very least halt shale gas exploration in Britain until more
research can be undertaken on both the climate-change impacts and contamination
risks associated with shale gas.” Note the extremism of her demand: don’t even
explore, much less try to use, resources until they are proven, to her
ilk, to be perfectly safe—something that will never happen.

What explains this visceral hostility to a product the human race desperately
needs, and the pushing of forms of energy that have proven time and again to be
commercial losers?

The answer is that much of the environmentalist movement consists of two
groups: neo-socialists, and neo-Romantic pagans. The former profess a
love of the ecosystem but are really animated by a hatred of capitalism. These
are the people who never uttered a peep about environmental degradation when the
Soviet Empire was cheerfully despoiling the ecosystem, but who now wax furious
at the thought that a capitalist — a capitalist — should even explore
for oil. Should Vladimir Putin or Hugo Chavez start using fracking, why,
instantly, fracking would be fine.

The second group, even more bizarre, is populated by those I have
characterized elsewhere as self-loathing
hominids, i.e., people who are ideologically misanthropic. They view their
own species as vile and disgusting, literally a blight upon the planet. The
thing they fear most is precisely the discovery of
inexhaustible, inexpensive energy. They fear it because such energy would allow
the human race to flourish, and these self-loathing hominids do not want the
human race to flourish. To them, rats and roaches are wonderful, but children
are not.

You simply can’t please these worshipers of Thanatos.

But the rest of us should rejoice in the renaissance of fossil fuels. Unlike
the green energy sources that have done so pathetically little to help humanity,
it holds the promise of inexpensive energy on which our continued prosperity
depends.

About this Author

Philosopher Gary Jason is a senior editor of Liberty Unbound, and the author of
the forthcoming book Dangerous Thoughts.

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Nic Leobold

Brilliant!

Thu, 2011-11-17 05:03

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