Thursday, July 24, 2008

Rick Noriega’s Energy Plan: Darn Near Perfect

I am struck these days about the raging controversy on energy between Texas’ junior senator, John Cornyn, and his Democratic challenger Rick Noriega. Struck because on the one hand we are faced with more of the same from Cornyn, who needs to take his head out of the sand and see what is happening in his own state. On the other hand, we have a new Democratic plan with some foresight: some actual by God thought went into it.

John Cornyn has, as his energy plan, Senate Bill 3202, the so-called “Gas Price Reduction Act of 2008.” The bill was introduced by Senator Mitch McConnell (R - KY) and has 47 Republican co-sponsors. Not exactly a bi-partisan effort to say the least.

S. 3202 is almost completely focused on a sunset industry: the oil and gas industry. It could be viewed as a complete federal giveaway program to oil companies, which already enrich themselves to the detriment of Americans and the US economy.

I would venture to suggest that this bill is an embarrassment to the oil companies in that there are too few resources out there for them to capitalize on the advantages being heaped upon them. Offers to end the moratorium on drilling in the US outer continental shelves, shelf acreage that exists beyond state waters (the old 3-mile limit) must and will go unanswered as there are a limited number of drill ships that are rated for these deeper waters – and all of them are currently locked into drilling programs for several years to come.

I would also venture to suggest that opening up all of the OCS to drilling sounds good politically, but lacks geologic credibility. Truth is, much of the promising acreage in the California OCS has already been drilled. Oregon and Washington, being regions of dominant volcanic activity for the past 20 million years, are at best areas where natural gas may be found – if it all hasn’t been cooked off that is.

Quite frankly, Oregon and Washington are better candidates for geothermal production.

The continental shelf off America’s east coast is a joke. The eastern shelf is what geologists call a “trailing edge” margin. The eastern OCS is lacks significant geologic structures, traps where petroleum collects. Indeed, the most promising structure ever drilled in the eastern OCS is Canada’s Hibernia Field, whose structure is associated with the Grand Banks – not the most widespread of landforms. Other productive areas in the Atlantic are associated with major delta systems such as the Niger Delta. No such major system occurs in the eastern US seaboard.

The US Gulf coast remains as the most promising oil and gas province. Nobody really disputes this, and emergent technology should help to discover deeply buried reserves there.

So S.3202 is just so much stuff and bluster. The words sound good but they lack substance. Not one acre additional of federal OCS land will yield the petroleum reserves that will get the United States back on its oil binge at cheap prices.

More significant measures have already been taken by an oil and gas industry that is euphoric at the historic prices they are enjoying. Go out to any established oil field in California and you will see a flurry of activity where little existed before. Pump jacks that once stood idle are furiously pumping away now. My recent visit to the Lost Hills Field revealed not only this fact, but I also witnessed two workover rigs operating within sight of each other on the same day this week in the Lost Hills Field. Workover rigs are production enhancement rigs that optimize oil production that has fallen off in a well. Workover jobs cost a lot of capital, but at current prices the decision on whether to approve these jobs is no longer a hard choice to make.

Oh, and the other part of S. 3202? Battery performance improvement. This must be an echo of John McCain’s $300 million bounty offer for new battery technology.

But not a word on what we are to use to charge up these uber-batteries. Presumably, we are to use refined products of petroleum.

Noriega’s approach is both long-term and realistic. You can find it here. Rick echoes Al Gore’s call toward 100% electricity supply from alternative sources by 2019. Wind power and photoelectric sources are chief among them. In accord with fellow Texan T. Boone Pickens, Noriega admits that this crisis is not one what we can drill ourselves out of, something that people need to believe, and something that Republicans are fighting to conceal.

But because Noriega includes relaxing the moratorium on offshore drilling in his multi-pronged approach to energy, he is being castigated by conservatives as a flip-flopper. Nothing could be further from the truth. Noriega has never, in a serious way, been opposed to oil development. It would be foolish for a Texas senator to oppose what still remains one of the state’s most vital industries. One that sends paychecks home to hundreds of thousands of Texans.

So where Cornyn favors a lop-sided solution, Noriega strikes for a bi-partisan middle ground, accepting oil exploration as an inevitable but with emphasis on development of renewables. Said he in Tuesday’s Dallas Morning News:
“Too often, Washington politicians treat energy policy as a false choice between finding new sources of fossil fuels or building our renewable capacity. I reject the either-or approach”
Notably, Noriega favors a ban on exports of new production that result from a relaxed moratorium, something that I think will be tricky to accomplish, but it is after all is said and done, a well-intentioned goal.

No, there is a vast gulf between Cornyn’s plan and that of Rick Noriega. Noriega’s approach is balanced and takes into account physical realities. Cornyn’s plan is more of the same, and more for the oil companies, who are, incidentally, very big cash contributors to his campaign.

This election, we are told, is an election for change versus a ratification of the same policies and plans that have driven this country into the ground. I think the endgame is just about decided at this point, but it is still irritating to see the same tired old solutions being given another spit and polish job, and still irritating to see Texans buying it.



Clark Bowers said...

California OCS has already been drilled! What are you talking about!????

Minerals Management Service estimates that discovered and undiscovered conventionally recoverable oil and gas resources of the Pacific OCS Region range from 14 to 19 billion BOE. In the California OCS Santa Maria and Santa Barbara-Ventura Basins, 24 offshore fields with reserves of 1.3 billion BOE have been discovered but are undeveloped because of the 1982 Federal moratorium on offshore drilling. The highside potential, including prospects in state waters, may reach 3.4 billion BOE.

Noriega said last month he does not want to drill. Now he does!! I thought they accused Ginobili of flopping! How can I trust that man changes that big a position in a month in the Senate?

Whats wrong with alternative battery production in Cornyn's plan?? And you don't need to harness petroleum based energy to charge battery's - aka wind, solar, geothermal, ect.??? We are the leading state now in Wind since Cornyn's been in office.

Does Noriega also still want to drill in Iraq?

I thought he didn't want to drill here in America and damage our land. What happened?

Noriega on Energy

Clark Bowers said...

Wow, you not displaying my comment about Noriega's energy plan to drill in Iraq clearly shows how hollow your beliefs are in your candidate.

Hal said...

Clark, if you had been paying attention and reading the blog in its entirety you would know that I am on vacation and can only check in from time to time. This has not prevented me from rejecting some comments on this subject, but clearly, not yours, both of which I read for the first time tonight.

Clark, do you really believe the MMS estimates? They use statistical analysis that relies not a whit on actual geological data, merely algorithms originating in Monte Carlo, or something like that. Everything that has been discovered in the California OCS has a production platform on it. Either that or the acreage has been relinquished.