One of the most pronounced themes to emerge from
President Obama’s State of the Union address is his
dedication to shale gas that he says is this
country’s newfound fortune. So why the disdain from
oil and gas producers?
Politically, the president can’t straddle the fence.
But he is able to show support for increased natural
gas usage because it has wide appeal and because it
would displace coal consumption. And while most
environmentalists would rather see the emphasis on
renewable fuels, they will nonetheless work to enact
more safeguards with respect to the drilling
process.
“We have a supply of natural gas that can last
America nearly 100 years, and my administration will
take every possible action to safely develop this
energy,” Obama intoned. “Experts believe this will
support more than 600,000 jobs by the end of the
decade. And I’m requiring all companies that drill
for gas on public lands to disclose the chemicals
they use” that are blamed by some for polluting
drinking water supplies.
The president goes on to point out that he is
opening up more offshore areas to drilling -- a move
that he had committed to make before the BP oil
disaster in the Gulf of Mexico. Now that the
administration has reviewed that situation and
implemented new safety measures, he said that
exploration can go on.
But he also jabbed the oil industry, noting that its
profits are greater than ever and that it should get
off of the government’s dole -- a place where it has
been perched for a century. The same monies that
have gone to it ought to now support innovative
green technologies: “Government support is critical
in helping businesses get new energy ideas off the
ground.”
Oil and gas producers are disapproving, saying that
the president is out to “stifle” development. They
want more access to areas now off limits to
development and will continue to push for the
Keystone XL pipeline that would run from Canada and
into Texas -- a point raised by Indiana Governor
Mitch Daniels in his rebuttal. The Keystone line is
“perfectly safe” and would employee thousands, he
says.
Scoring Big
Natural gas production, incidentally, is sky high.
The October 2011 report by the U.S.
Energy Information Administration says that
about 2,500 billion cubic feet of natural gas was
plumbed from the earth -- the most on record.
“This is progress, but it falls far short of what we
could do with greater access to domestic supplies
and sounder regulatory policies,” says Jack Gerard,
head of the
American Petroleum Institute. “We hope the
administration will look at the numbers and do what
we've been asking them to do for a long time: Work
with us to produce at home even more of the oil and
natural gas our nation will require.”
President Obama, of course, will not tow the
industry line. Part of his re-election effort must
involve shoring up his environmental supporters. To
that end, the president notes that renewable energy
has doubled from its relatively small base since he
came to office. Thousands are employed because of it
-- something that could snowball if Congress were to
pass his so-called Clean Energy Standard that sets
future goals for wind and solar, he says.
The president has recently scored big with the
greenies, first by enacting a new mercury rule to
dramatically cut those releases and second, by
rejecting efforts to build the Keystone XL pipeline.
Environmentalists, furthermore, laud his efforts to
increase fuel efficiency standards for new cars to
54.5 miles per gallon by 2025.
“Yet (the administration) also ceded ground to
polluters,” writes Frances Beinecke, president of
the
Natural Resource Defense Council, in her blog.
“Its decisions to expand offshore drilling and
postpone smog standards, for instance, will benefit
dirty industries and make it harder for Americans to
protect our health and resources. So our work goes
on.”
For the environmental movement, that means getting
the EPA to enact promised new regulations on carbon
and coal ash, as well as ensuring that hydraulic
fracturing does not contaminate drinking water
supplies. Meantime, they are keeping up the
relentless beat to build more green energy
facilities.
Those are causes to which the president is
sympathetic but they are not ones that easily
accomplished. Conciliation is key not just to
earning concessions but also to broadening the
political support he needs to win the presidential
campaign.
EnergyBiz Insider is the Winner of the 2011 Online
Column category awarded by Media Industry News, MIN.
Ken Silverstein has also been named one of the Top
Economics Journalists by Wall Street Economists.
Follow Ken on www.twitter.com/ken_silverstein
energybizinsider@energycentral.com
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