North Dakota Proves Obama Doesn't Get Energy
The Bakken and Three Forks formations in North Dakota, South Dakota and Montana contain significantly more oil-and-gas resources than previously thought, according to a new U.S. Geological Survey (USGS) reassessment. The survey found an estimated 7.4 billion barrels of undiscovered, technically recoverable shale oil (resources that can be recovered with current technology but whose precise location is unknown), double its 2008 assessment. The reassessment also found three times as much recoverable natural gas than previously believed to exist.
North Dakota, which leads the nation in job growth, wage increases, and low unemployment, owes much of its success to the shale energy boom and hydraulic fracturing advances. Meanwhile, as national unemployment hovers around 7.5 percent - more than twice the rate of North Dakota -- the federal government's policy toward energy production can only be described as a "bust."
At nearly every turn, the federal government is actively obstructing domestic energy production. For example, oil and natural gas production on federal lands is down by more than 40 percent compared to 10 years ago. Consider the impact in light of the government's vast landholdings: Uncle Sam owns 36.6 percent of Colorado, 57.4 percent of Utah and 42.3 percent of Wyoming. Those three states happen to contain the nation's principal holdings of oil shale (not to be confused with shale oil). Unlike shale oil, which is conventional oil trapped in shale rock, oil shale is sedimentary rock that contains kerogen. Kerogen is considerably valuable because it can be processed into liquid fuels that are used as raw material for a vast array of consumer goods.
Instead of encouraging oil shale development, the Obama administration is keeping resource-rich regions in Colorado, Utah, and Wyoming under lock and key. At stake is enough technically recoverable oil shale to provide American consumers with 140 years of electricity at current usage rates. While oil shale has yet to be developed in the United States, Estonia, for example, already derives 90 percent of its electricity production from this energy source. However, America will never develop its oil shale resources if the federal government continues to restrict access.
Despite untapped domestic energy supplies locked away on federal lands, the Obama administration continues to drag its feet in processing drilling applications, according to a recent report by the nonpartisan Congressional Research Service. In 2006, it took 218 days on average to process an application for a permit to drill on federal lands. Since then, the Bureau of Land Management increased the complexity of the forms so much that by 2011, it took an average of 307 days to turn an application around, a 41 percent increase. "A more efficient permitting process may be an added incentive for the industry to invest in developing federal resources, which may allow for some oil and gas to come onstream sooner, but in general, the regulatory framework for developing resources on federal lands will likely remain more involved and time-consuming than that on private land," the CRS report concluded.
Expanding energy production on federal lands would have an enormous impact on the American economy, according to an independent study published by the Institute for Energy Research (IER). The resulting broad-based economic stimulus would include a $127 billion annual boost in GDP for the next seven years; an increase of 552,000 jobs annually for the next seven years; wage hikes of $32 billion for each of the next seven years and $115 billion annually between seven and thirty years. Additionally, our cash-strapped federal government would realize $24 billion in annual revenue over the next seven years, and $86 billion annually thereafter. State and local governments would also benefit from $10.3 billion additional annual revenues over the next seven years, and $35.5 billion annually thereafter.
As the USGS reassessment demonstrates, new energy discoveries and technological advancements are happening at a rapid pace. North America has 1.79 trillion barrels of proven oil reserves, according to the North American Energy Inventory released by IER in December 2011. That's enough to fill the tank of every passenger car in the United States for the next 430 years! The survey also estimated 4.244 quadrillion cubic feet of recoverable natural gas resources, enough to heat every home for the next 575 winters at current usage rates. Of course, these estimates were published well before the new USGS reassessments. America's true energy supply is undoubtedly even more robust, providing further certainty that domestic resources can meet America's energy needs for years to come.
America continues to struggle amid sluggish growth, staggering budget deficits, and the Obama administration's desire to ensure that sequester cuts inflict maximum harm. North Dakota, with plenty of high-paying jobs and a $1.6 billion budget surplus, serves as a blueprint for rejuvenating the American economy. North Dakota's pro-growth energy policies are a testament to the curative power of unlocking access to domestic energy resources.