Wednesday, October 10, 2012

When "Drill, Baby, Drill" Meets "..But Not on My Land"

Is it now just dawning on Americans that "domestic energy production" means that corporations and government agencies will come take their land to build the infrastructure for said energy production?

Darryl Hannah got arrested for trespassing on her own farm -
the oil company has permission from the courts to drill here
after she said, "No thanks."
I support energy development in this country, and would gladly pay extra for gas that did not support terrorism abroad; but I recognize four fundamental truths about expanding domestic energy, and I hope you do as well:

1. It (on the fossil fuel side) is a very short term solution to a very long term problem.

2. Energy will never be any cheaper than it is right now.

3. Other "important things" like clean water and private property rights are going to suffer, at least in the short term.

4.  If energy companies' similar efforts in other nations are any indication, there will not be anybody around in  50 years to clean up the mess, after we've extracted all the fossil fuels that we can.

None of those things tell me at face value that we absolutely shouldn't drill domestically.  But let's get a reality check in place.  It takes years to build oil rigs and pipelines.  It takes money.  That infrastructure will be paid for by us (all four characters in the race for the White House prefer that it be paid via subsidies to energy companies - we will pick up the tab for it).  And gas is not going to get any cheaper.  Several years ago, around the time that gas prices rose past $2.50/gallon for the summer (as they had been) and suddenly did not drop back below $2.00 again in the fall, I had the opportunity to share a duck blind with some upper management staff from ConocoPhilips.  Someone else asked about gas prices, to which the leader of the group responded, "If you're asking if there's any scenario in which we see $2 gas again, then the answer is absolutely not."

No, it won't get cheaper, and by the way, the price for developing this new infrastructure will be laid upon our consumer goods and our tax bills.   And as well.........our land, and as is the case with the Keystone XL Pipeline, you can turn down the payment, but not the impact - they call it a "public improvement" like a highway.  Except, unlike a highway, someone will make a huge daily profit off of the impact to your land without ever buying the land from you.

Domestic energy production is, in my opinion, vastly more responsible than our current system that is based on an import (price) market that we do not control (as only the former #1 importer of oil).  But building a new system will impact basic property rights that so many American conservatives are adamant about, and it will doubtlessly lead to a landscape legacy of industrial crap (and perhaps contaminated soil and water) that we, the taxpayers, will be called upon to pay for in future decades.  To agree or disagree with domestic oil extraction as a result of those facts is a value judgment that each of us can make.  Can't fault a person for making a fully-educated judgment call.

But it's foolish to pretend that domestic oil and gas production are private and public cure-alls for high fuel prices and American unemployment.   The United States burns over 7 billion barrels of oil per year, which seems like a great reason to go toward domestic production, until you learn that our domestic production is currently about 1.5 billion barrels per year (with no quick way to upgrade our facilities).  And that our easily extractable oil reserves are around 52 billion barrels (7-8 years' worth), and that our "trash oil" reserves (oil shale, etc) are about another 50 billion gallons - bound to be much more expensive to extract and process into high quality fuel.

Fasten your seatbelts, America.  Hopefully on a train or a bus or some other type of public transit.  Because keeping gasoline easily available in this country over the next 50 years is going to get expensive, and will step on more than a few toes.   Looks like private property rights and cheap gasoline are about to have words with one another - it's happening on ranches and timberland up and down the length of the Keystone XL Pipeline.


GSFeder said...

Thank you for making a point a lot of people seem to miss. Can't remember where I heard it (NPR?) but some economists note that the true price of a gallon of gasoline is not in any way fully reflected in its price at the pump, as the externalities are shifted.

And as for job growth, isn't the development of energy sources that comply with EPA regulations going to require innovation and production of technology? That's a lot of potential jobs, too.

T. Brook Smith said...

Actually, Ms. Hannah didn't own the land but she graciously offered to be arrested with the land owner (who is slightly less photogenic and well known). Facebook friend Julia "Butterfly" Hill is organizing this protest and they have people living in trees in the path of the pipeline. Eminent domain? That some scary stuff. It's TVA all over again.

Kirk Mantay said...

Well, it's interesting, because government-sponsored environmental work (including remediation) has failed the eminent domain test in the courts time and time again.

But a multi-national corporation can get the courts to find that laying private pipeline carrying private oil to private refineries is an appropriate application of eminent domain on third party landowners. Truly, truly bizarre.

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