During his State of the Union Address late last month, President Obama crowed about the big increase in oil and gas production that has occurred in the last couple of years under his watch. While it’s true that oil and, especially, natural gas production have increased over the past few years, much of this energy boom (especially the growth in natural gas production) began before Obama became President and almost all of it occurred in spite of repeated roadblocks to new production erected by the Obama administration. Obama has thwarted pipelines, prevented expansion of offshore drilling while shuttering some platforms in the process of construction and has placed a great deal of public lands previously open to leasing and development off limits.
Two things have driven the increase in production: high prices and new fracking techniques. In truth, the former drove the latter. High prices in natural gas, first, in the early years of this decade drove the development of combining horizontal drilling with fracking techniques that opened up whole new gas fields. Now the same combination of technology is being used to produce oil. Natural gas production through fracking has become so successful that despite dramatic increases in use, prices have fallen – fallen to such a great extent that companies are beginning to shut down some productive wells because it cost more to operate them than they can make sell the gas for.
In a series of stories, I, among others, have detailed the different approaches states have taken to the fracking revolution. Some states see it as a promising industry for new jobs and revenue. Others have bought into the false and misleading claims made by environmentalists and touted by the media – the media loves a good disaster story, never mind the facts.
A new report – just one more to addition to the mounting pile of evidence – demonstrates, once again, what previous reports have found: Fracking is safe – it causes neither air or water pollution. This was a peer reviewed study, not funded by the industry. Regardless, even before the paper received widespread release, environmentalists who couldn’t even have had the time to read the report, much less analyze its methodology, complained in interviews that the report wasn’t sound and didn’t answer key questions. Their complaints were groundless – but then, on this issue, they usually are.
What’s at stake? An article in oilprice.com with some excellent data echo’s what a variety of analysts have been saying – the shale boom, both for oil and gas, will change the world. The only question is – at least in the Western World, and the U.S. in particular, is how much will the world’s peoples benefit from this abundant source of energy; in other words will Western leaders bow to environmental elitists and shut the middle class and the poor off from the benefits or reliable, abundant energy or will they open the taps and lower the regulations.