This week, President Obama and Interior Secretary Salazar returned to familiar territory, once again chastising energy companies for maintaining an inventory of undrilled Federal leases.

Obama challenges oil companies to drill existing leases

WASHINGTON – The White House on Tuesday pushed back against the oil and gas industry’s claims that the Obama administration is blocking domestic energy development, releasing a new analysis showing that 46 million acres of federal lands and waters leased for drilling are sitting idle.

According to the Department of Interior report, oil and gas companies are actively drilling or have launched development on less than a third of the 36 million acres they have leased offshore, and on just over half of their onshore leases. …

With gasoline prices and the economy looming large at the ballot box this year, the administration has been emphasizing its commitment to an “all of the above” energy policy and especially touting its support for domestic natural gas production. …

“We continue to make millions of acres … available for safe and responsible domestic energy production on public lands and in federal waters,” said Interior Secretary Ken Salazar in a statement. “We also want companies to develop the tens of millions of acres they’ve already leased but have left sitting idle.”

So shut up and drill the leases you already have!

In this post I will try to demonstrate just how disingenuous that position is.

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As long as our system rewards an interesting personal narrative over character, achievement or intelligence, we will have a problem with people embellishing their resumes to gain an advantage.

Barack Obama and Elizabeth Warren are only the most recent examples.

The yellowed Hawaiian newspaper clipping is good enough for me. Obama is a natural-born American citizen. But to Occidental, Columbia and Harvard, the story of a Kenyan birth made a more interesting story than the story of an upper-middle class kid who was raised in Hawaii by his grandparents.

It’s a disease that is especially noticeable in higher education. When my daughter applied to a selective midwestern liberal arts college, we received a copy of a recruiting pamphlet the school published: “Meet the Class of 200X”. It detailed a dozen or so profiles of entering freshmen from the preceding class. It became a running joke in our family.

One kid spent a summer in high school nursing baby wildebeests back to health in the Serengeti.

Another helped his family build a log cabin in Honduras using hand tools only.

Another swam the Amazon while researching indigenous tribal music.

At the elite institutions, it’s no longer enough to have high board scores, an impressive high school GPA and a leadership position on the Student Council.

Ya gotta have game. Ya gotta have a narrative. The system knows this, abets it and helps in its manufacture. Nobody audits, nobody checks, because in the end, nobody cares. The school just passes along what it’s been told.

The only people it hurts are the ones that are stupid enough to stick with the literal truth.

We saw it on a small scale with our daughter. While being lauded for her achievements at her graduation from her small high school, the headmaster told of the hours that Junior had spent volunteering at a retirement home. I wish she had, but it wasn’t really true.

I’m sure there are a lot of kids out there with wonderful stories to tell of overcoming hardship and adversity, or taking on an unusual challenge. But as long as the system rewards stories of an exotic origin, or 1/32 ancestry in an oppressed minority, there will be embellishment.

As I learned in my youth, “The first liar doesn’t have a chance.”

Cross-posted at SteveMaley.com.

Vermont is not an oil and gas state. Check that. Vermont is not an oil and gas producing state. According to the state geologist’s website, a total of six wells have been drilled targeting oil and gas since the Green Mountain Boys trod its, uh, green mountains. All of the wells were dry holes, and the last one was drilled in 1984.

But VT is an oil and gas consuming state, to be sure. Just to clarify, Gov. Shumlin is OK with fracking, as long as it’s in OK (or TX, LA, NM, WY, ND, PA, WV, MI, OH, UT, etc.)

I am going to contact my legislator to get a ban on harvesting maple syrup in Louisiana as a kind of retaliation. My Lord, who knows what might happen if you get that sticky, microbe-laden goo in the water supply!

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Obama’s energy policies are a key vulnerability in the November elections, which has his staff scrambling to make it look like he’s actually done something to support domestic energy production. Since neither he nor anyone in his Administration knows the first thing about oil and gas, that can lead to some pretty ridiculous claims.

Like, for example, the following graph, found at Obama For America‘s website.  (The small arrow reads “Obama Takes Office”. Click on the graph to see a larger size.).

At the end of this post you will find a FIFY (“Fixed It For You”) graph which identifies several other events of significance equal to or greater than that of Obama’s inauguration.

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Rep. William Cassidy (R-LA) common-sense approach to increasing the role of natural gas as a vehicle fuel, without the grandiose involvement of the Federal government. Unlike the Pickens Plan, this plan does not rely on massive government subsidies or direct payments for vehicle conversion. Instead, it would change the definition of “independent producer” in the tax code, to get around their current prohibition from making retail sales exceeding $5 million per year.

Full text at www.thehayride.com. Originally published in the Shreveport Times.

The recent natural gas boom in the United States has been so wide-spread and profound that it has dropped natural gas prices to historical lows. These prices are so low that producers have begun to scale back operations as extraction has almost become uneconomical. We should be focused on exploring new commercial markets for natural gas to take advantage of such a low-cost energy source. Because technology and supply is currently available to sell the natural gas equivalent for about $1.50 a gallon compared with the current price of gasoline, it would seem natural for consumers to begin making the switch to compressed natural gas CNG (Compressed Natural Gas) vehicles.

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A couple of weeks back, my boss asked a question that I could not immediately answer:

The ethanol tax credit expired on December 31. The price of ethanol should have gone up afterward. Did it? How much has that affected the price of gasoline?

I turned to my friends at the American Petroleum Institute for help. Their surprising answer, in part:

API declined to answer whether the expiration of the credit has affected gas prices.

A little research helped make sense of this counter-intuitive set of facts, and sheds light on the efficacy of the government’s forays into the marketplace.

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UPDATE 4/30/2012 via Fox News: Top EPA official resigns after ‘crucify’ comment

A top EPA official has resigned after coming under scrutiny for 2010 remarks in which he compared the agency’s enforcement strategy to Roman crucifixion.

Al Armendariz, the top environmental official in the oil-rich South and Southwest region, resigned in a letter to EPA Administrator Lisa Jackson on Sunday, saying he did not want to be a distraction for the agency. The resignation is effective Monday. 

“As I have expressed publicly, and to you directly, I regret comments I made several years ago that do not in any way reflect my work as regional administrator. As importantly, they do not represent the work you have overseen as EPA administrator,” he wrote. “I take great pride in having built a career based on integrity and hard work. These are the principles that guide me personally as well. While I feel there is much work that remains to be done for the people of this country in the region that I serve, after a  great deal of thought and careful consideration, I have come to the conclusion that my continued service will distract you and the agency from its important work.”

Earlier this week, a two-year old YouTube video surfaced that floated some raw sewage in the Obama Administration’s energy punchbowl. In it, EPA Region 6 Administrator Al Almendariz, speaking to a group of Texas citizens, chuckles while comparing his agency’s environmental enforcement strategy vis-à-vis oil and gas operators to conquering Roman legionnaires’ strategy of random crucifixion. How quaint.

So the Washington politicians did what politicians have done since Roman times: go into damage-control mode and attempt to distance themselves from the offending act. From the Washington Post:

“Frankly, [the comments] were inflammatory but also wrong,” [EPA Administrator Lisa] Jackson said Friday when asked about a YouTube video discovered this week by Oklahoma Republican Sen. James M. Inhofe’s staff. “They don’t comport with either this administration’s policy on energy, our policy at EPA on environmental enforcement, nor do they comport with our record as well.”

The offending comments were uttered, not by low-level functionary deep in the bowels of EPA, but by a Presidential appointee, the Administrator of EPA Region 6. Region 6 covers “Arkansas, Louisiana, New Mexico, Oklahoma, Texas and 66 Tribal Nations” and as such is home to 56% of domestic crude oil production and 59% of natural gas production. Needless to say, statements of the Region Administrator on enforcement policy carry some weight. The tough-guy policies certainly seemed consistent with the treatment of Range Resources. Range was the subject of a Region 6 “endangerment order”, an EPA accusation of groundwater contamination that was contradicted by the scientific evidence and ultimately dropped.

Plus, these weren’t the words of a leaked internal email.

He said it in public.

In the private sector, it can be a problem when the public statements of a senior executive “don’t comport” with official policy. A recent example:

BP CEO Tony Hayward uttered the ill-advised “I’d like my life back” in the process of a public apology for the BP spill. Those five words resulted in a PR firestorm that led to Heyward’s dismissal by BP’s Board.

Twenty-nine congressmen, including all of Texas’ Republican representatives, have signed a letter calling for Almendariz’s ouster (excerpted below the fold). They have been joined in the call by Reps. Scalise, Alexander, Boustany, Fleming and Landry in Louisiana.

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Apologies to John Lennon. Concept by Al Armendariz, Administrator of EPA Region VI. Repair Man Jack posted the video with analysis here.

No apology is necessary, Mr. Armendariz. In a perverse way, your comments reveal the tactics of your agency, and more importantly, the philosophy which motivates Mr. Obama’s entire Administration.

It also speaks of the arrogance of a government that thinks its citizens are its subjects, and whose middle managers find amusement in crushing people’s lives and livelihoods.

One more thing about the Roman analogy — mmm, as I recall, that strategy didn’t work out too well for the Romans. Does Mr. Obama play the fiddle?

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Happy Earth Day 2012, everyone! One day we may look back on this as the time when the tide began to recede – that being the tide of Anthropogenic Global Warming hysteria.

The canary in this metaphorical mine is the Discovery Channel, long a mass purveyor of AGW porn. In its new seven-part series “Frozen Planet” Discovery confronts distraught polar bears and calving glaciers in glorious High Definition, but nary a mention of the Scientific Consensus that can best be summed up as “Aaaaargghhh! We’re All Going to Die!!”

Because their marketers have discovered that people don’t buy that. Either they don’t agree or they’ve tired of the subject, but Discovery just can’t sell that brand of compost any more.

The article in The New York Times tiptoes around that fact, blaming the lack of AGW hysteria on the “politicization” of the issue and the 10% (sic) of us Flat Earthers who are conflicted between Scientific Consensus and Our Lying Eyes.

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All these years? Poetic license. It’s been two years since the disastrous explosion on the Deepwater Horizon drilling rig. Eleven rig workers were killed in a valiant but failed attempt to control BP’s Macondo well located 50 miles off the mouth of the Mississippi River in Gulf waters 5,000 feet deep. The ensuing blowout seemed to last an eternity. The finger pointing and legal action continues unabated.

Two Years Later, the Effects Surface

BARATARIA BAY — Open sores. Parasitic infections. Chewed-up-looking fins. Gashes. Mysterious black streaks. Two years after the drilling-rig explosion that touched off the biggest offshore oil spill in U.S. history, scientists are beginning to suspect that fish in the Gulf of Mexico are suffering the effects of the petroleum.

But the article goes on to say…

The evidence is nowhere near conclusive. …

And the damage may extend well beyond fish. …

Reports of strange things with fish began emerging when fishermen returned to the Gulf weeks after BP’s gushing oil well was capped during the summer of 2010. …

There’s no saying for sure what’s causing the diseases in what is still a relatively small percentage of the fish. …

Still, it’s clear to fishermen and researchers alike that something’s amiss.

You’d think that with the scale of this calamity and the amount of money that’s gone into ferreting out the damage, that the damage would be fairly obvious and the science would be quite, {ahem}, settled.

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In the March 24 Louisiana presidential preference primary, Democratic challenger John Wolfe, Jr. scored 17,804 votes. Wolfe is a lawyer from Chattanooga, TN and a virtual unknown in Louisiana. Party rules award delegates to the national convention for any candidate whose vote exceeds 15% in a congressional district. Wolfe racked up almost 19.6% in the 1st District, 17.2% in the 3rd and 22.0% in my district, the 7th.

That’s a minimum of three delegates, right there. Congratula… oooh, not so fast.

Louisiana Democratic Party denies 3 delegates to fringe candidate

“Mr. Wolfe is not eligible for any delegates in the state of Louisiana as he failed to comply with the Louisiana delegate selection plan,” said James Hallinan, director of communications and research for the state party. “Mr. Wolfe violated rule 2B in the delegate selection plan by failing to certify an authorized representative for his campaign in Louisiana to the Louisiana Democratic Party by the deadline of December 9, 2011.

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From Business Week:

Exxon’s top exec got a 17pct. pay raise in 2011

Exxon Mobil gave its top executive a 17 percent increase in compensation last year, as the oil giant posted one of its most profitable years on record.

Rex Tillerson, 60, received a pay package worth $25.2 million, up from $21.5 million in 2010, according to an AP analysis of a regulatory filing on Thursday.

Tillerson received an annual salary of $2.4 million, a bonus of $4.4 million and stock awards worth $17.9 million. He also received $519,230 in miscellaneous compensation including life insurance, personal security, personal use of company aircraft, and financial planning.

Tillerson owns 1.743 million shares of XOM stock worth $145 million, or 0.037% of the company. (Most of the stock of the Big Oil companies is owned not by their managers but by pension funds, mutual funds, and individual investors.)

For comparison, here are the latest available annual compensation numbers for the CEOs of XOM’s competition:

• Jim Mulva, ConocoPhillips, $27,713,594
• John Watson, Chevron, $25,000,000
• Peter Voser, Royal Dutch/Shell, €5,208,000 = $6,800,000
• Robert W. Dudley, BP, $3,404,300

Outrageous!

But consider that each of these gentlemen has been successful in rising to the peak of the pyramid in the largest and most complex enterprises in the history of capitalism.

Then consider this:

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Blaming natural phenomena on fracking is this year’s fad, reminiscent of the mood ring, the pet rock or Anthropogenic Global Warming.

Item 1. Vice-President of the United States Joe Biden may not know what hydrofracking is, but he does know that it sounds plenty scary.

“… There’s a thing called fracking. They’ve got to go crack the rock in order to get [oil and gas] out. You can environmentally do that well or you can environmentally do that poorly,” the vice president said.

“If you do it poorly, you use up the water aquifer. [Huh?! - Ed.] You can create, in some cases the argument is, earthquakes,” he concluded.

Mr. Biden was referring to a string of minor tremors over the past year in the Youngstown, Ohio, area, including a 4.0 quake that shook the city on New Year’s Eve.

But state officials have confirmed that the temblors were the result of a wastewater-disposal well, not fracking itself.

As I commented at the time, the problem here is not that frack fluid is being injected. Mother Gaia is indifferent to whether the fluid is frack water, bong water or mother’s milk. Fracking is not the culprit; if you inject lots of fluid into an existing fault zone, that may create a problem, but its a problem best addressed by state authorities. They are in a much better position to appreciate local geomechanics than is a Federal agency like the EPA.

The evidence here reveals one thing that is definitely caused by hydraulic fracturing: Vice-Presidential confusion.

Item 2. Is hydrofracking causing the mysterious Clintonville (WI) booms?

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With 3/4 of the precincts reporting, Rick Santorum is leading with nearly 50% of the Republican vote. Romney has 26%, Gingrich 16%.

Update 10:18 pm CDT: That margin looks like it will hold. See TheHayride’s analysis here.

Incumbent President Barack Obama has 72% of the Democratic vote against a powerful field that includes Bob Ely, Darcy G. Richardson and John Wolfe.

Unofficial tally here.

Open thread.

What better place to start the correction of history than in the pages of The New York Times:

U.S. Inches Toward Goal of Energy Independence

Taken together, the increasing production and declining consumption have unexpectedly brought the United States markedly closer to a goal that has tantalized presidents since Richard Nixon: independence from foreign energy sources, a milestone that could reconfigure American foreign policy, the economy and more. In 2011, the country imported just 45 percent of the liquid fuels it used, down from a record high of 60 percent in 2005. …

How the country made this turnabout is a story of industry-friendly policies started by President Bush and largely continued by President Obama — many over the objections of environmental advocates — as well as technological advances that have allowed the extraction of oil and gas once considered too difficult and too expensive to reach. But mainly it is a story of the complex economics of energy, which sometimes seems to operate by its own rules of supply and demand.

[Emphasis added. Link may require subscription.]

Winston Smith and the boys over at the Ministry of Truth must really be burning the midnight oil utilizing stored solar energy.

When they start disappearing history down the memory hole, stories like my diary from last week will be a priority: Flashback to 2009: Administration Policies Sought to Discourage ‘Overproduction’ of Oil.

In the interest of bureaucratic efficiency, I’ve assembled a list of other diary entries, dating back to the Campaign of 2008, that document a history of Obama’s hostility to domestic oil and gas production. These, of course, will need to be ‘sanitized’ in order to conform with The New Truth.

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In his Thursday energy/pipeline speech at Cushing, OK, President Obama opened his mouth and revealed a total lack of understanding of our nation’s energy supply picture.

And I’ve been saying for the last few weeks, and I want everybody to understand this, we use 20 percent of the world’s oil; we only produce 2 percent of the world’s oil.

Hmmm. “We only produce 2 percent of the world’s oil” the man said? Seems like that would be pretty easy to check… How about Wikipedia, whose source on world oil production is the CIA World Factbook. (Figures are for crude oil plus natural gas liquids; b/d = barrels per day.)

1. Russia – 10.5 million b/d, 12.0% of world total
2. Saudi Arabia – 8.8 million b/d, 10.0% of world total
3. United States – 7.8 million b/d, 8.9% of world total
4. Iran – 4.2 million b/d, 4.8% of world total
5. China – 4.0 million b/d, 4.6% of world total

H/T Andy Dean

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Paul Krugman’s op-ed, “Natural Born Drillers” (New York Times, March 15), purports to show with a hard look at the numbers why no thinking, perceptive person could possibly believe that “Drill, Baby, Drill” is a solution to the nation’s energy and economic woes:

[G]iving the oil companies carte blanche isn’t a serious jobs program. Put it this way: Employment in oil and gas extraction has risen more than 50 percent since the middle of the last decade, but that amounts to only 70,000 jobs, around one-twentieth of 1 percent of total U.S. employment. So the idea that drill, baby, drill can cure our jobs deficit is basically a joke.

Hmmm. Shall I take the strawman, or the phony statistics first?

{Coin flip}: It’s heads. Strawman!

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In May 2009, four months into the Obama presidency, retail gasoline prices averaged $2.32 per gallon. Rep. Charles Boustany (R-LA) wrote Treasury Secretary Tim Geithner to express concern about the impact that the Administration’s budgeted changes in tax policy would have on the oil and gas industry. Secretary Geithner clearly laid out the Administration position in his letter of response (pdf link).

That was then, this is now.

In just three years’ time, retail gasoline prices are up 68%. $4.00+ gasoline prices loom as a key reelection vulnerability for the President; in response, the Administration’s rhetoric has shifted to “energy friendly”, but its original energy-hostile policies have not changed a whit.

From Secretary Geithner’s May 2009 letter:

The Administration believes that oil and gas preferences distort markets by encouraging more investment in the oil and gas industry than would occur under a neutral system. To the extent the credit (sic) encourages overproduction of oil, it is detrimental to long-term energy security and is also inconsistent with the Administration’s policy of reducing carbon emissions and encouraging the use of renewable energy sources through a cap-and-trade program. Moreover, the credit (sic) must ultimately be financed with taxes that result in underinvestment in other, potentially more productive, areas of the economy.

The President campaigned on the idea that, if we are to finally reduce our dependence on foreign oil, we need to set aside old political battles and instead make the investments in new clean energy technology that will create good jobs here at home.

So, to recap:

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Voters in the November election will be acutely aware of two key economic variables above all others: the national unemployment rate, and the price they pay for a gallon of gasoline. President Obama senses his vulnerability on gasoline prices, and is busy erecting a defense against charges that his actions (or inactions) have contributed to high prices.

His weekly radio address focused on the problem of rising gasoline prices and energy policy in general:

Ending this cycle of rising gas prices won’t be easy, and it won’t happen overnight. But that’s why you sent us to Washington – to solve tough problems like this one. So I’m going to keep doing everything I can to help you save money on gas, both right now and in the future.

Earlier this week, Obama said that gasoline prices are rising in part because of international bottlenecks and supply disruptions that affect the crude oil market.

Obama cites bottlenecks, speculation as possible gasoline price factors

US President Barack Obama said his administration is looking at whether it would be possible to ease both international and US supply bottlenecks as an immediate response to rising gasoline prices. … “We’re concerned about what’s happening in terms of production around the world. It’s not just what’s happening in the [Persian] Gulf. You’ve had, for example, in Sudan, some oil that’s been taken offline that’s helping to restrict supply.”

In its Mar. 6 Short-Term Energy Outlook (STEO), the US Energy Information Administration said several notable production disruptions outside the Organization of Petroleum Exporting Countries began or intensified during the last 2 months, leaving an average 1 million b/d [barrels per day] offline in February. [Emphasis added.]

Those production disruptions include a year-on-year loss of 230,000 b/d in the Sudan, 80,000 b/d in Yemen, and 140,000 b/d in Syria. That’s 470,000 b/d total shortfall from just those three hotspots.

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Rush Limbaugh is on a rant right now about the Big Energy Lie – President Obama’s assertion that:

“We can’t just drill our way out of this problem — while we consume 20% of the world’s oil, we only have 2% of the world’s oil reserves,” he said. [Source.]

Rush confused the issue with regard to the definition of reserves, suggesting that it has something to do with how much oil has been produced to date. It does not.

Reserves are the amount still in the ground that have been found by drilling efforts to date, and are expected to be produced with current technology, at current prices.

Reserves have been around 10 years of production ever since I can remember. That’s because energy companies measure their success by their ability to “replace production” – that is, if they produce a million barrels, they need to replace it with a million barrels of reserves. It’s like a current inventory.

Or like a checking account.

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