Monday, September 29, 2014

Russia and Energy Stranglehold on Europe

Subtitle: Still Dumb to Drill Baby Drill in US

An article by Paul Driessen, senior policy analyst at CFACT, appears at  (see link), in which he makes several points directed at how EU nations and the US should change energy policies to reduce the Russians' grip over those EU countries.   

(side note:  I met Paul Driessen briefly at the Ninth International Conference on Climate Change, July 7-9, 2014, in Las Vegas, Nevada.  I cannot say I know the man well; it was just a very brief hello and exchange of cards.)

Some of what Mr. Driessen wrote in his Stranglehold article makes sense, and I agree with those points.   Other points are wrong, in my view.  

He is correct that Russia sells a great deal of natural gas to EU nations, and that Russia sometimes cuts off the gas flow.   He is also correct that EU nations could, and probably should, take steps to reduce reliance on Russian gas.  

His recommended steps are to import more gas from the US and other countries, and produce gas in their own countries.   What Mr. Driessen does not mention is that the US economy is enjoying a boom in engineering, process plant construction, and production of materials produced in those plants.  The economy, as bad as it is, would be much, much worse without the present supplies and low prices of feedstocks for those process plants - feedstocks that derive from production of natural gas.   Exporting natural gas to EU countries or elsewhere would increase the price of our domestic gas, and the light hydrocarbons that feed those chemical processing plants.    Therefore, it is not in the US' best interest to export natural gas to EU. 

I agree that other countries could, and should, produce their own reserves of natural gas.  The key process is precision directional drilling, not just hydraulic fracturing.   (see link for my article on France, natural gas, and the French nuclear industry). 

Next, Mr. Driessen argues that the US should increase drilling and production of oil from Federal lands.  This is an error, as I have written on and made speeches about (see link).  In my 2011 speech at Tulane Law School, New Orleans, Louisiana, I made the point that the US must conserve its oil resources against a future when other countries once again stop their oil exports to us, and we are in a prolonged and possibly world war.  All US presidents know that one of the reasons the Allies won World War II was the oil from the US.   This is indisputable, and is described in great detail in the Pulitzer Prize-winning book The Prize by Daniel Yergin.    As I said in my speech at Tulane, 

". . . we must take the long view and not be short-sighted. It is critical that the US be prepared for that day when we will desperately need our domestic oil. That day when our foreign supplies are cut off yet again, and this time we are in a prolonged world war, similar to World War II. To meet that day, we must have oil in our own lands. Every president since Truman has known this to be true, and therefore have made so much of the USA offshore off-limits to drilling. The West Coast, East Coast, and eastern Gulf of Mexico are off-limits to drilling. Much of the on-shore lands are also off-limits, including the ANWR. We know the oil is there. We don’t need that oil right now. Preserving that oil for the future is critical, and that is why Drill, Baby, Drill is Dumb, Baby, Dumb."

Finally, Mr. Driessen opines that "the world is not going find safe, efficient, affordable, environment-friendly alternatives to oil, natural gas and coal in the next decade or so."   Yet, the renewable energy industries have already delivered wind and solar power that is producing valuable electric power.  The renewable energy field has ongoing reductions in production costs, as more efficient machines are made in both wind and solar arenas, better wind resources are tapped, economy of scale is applied, and grid-scale storage systems are deployed.   High prices for natural gas make the economics of renewable systems even better, therefore EU nations can look more and more to renewables.   The future will include not only wind and solar, but ocean currents will provide vast amounts of inexhaustible power with no need for storage.  

Roger E. Sowell, Esq. 
Marina del Rey, California

copyright (c) 2014 by Roger Sowell -- all rights reserved

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