By Kathleen Hartnett White
Texas Insider Report: AUSTIN Texas The U.S. passed Saudi Arabia as the worlds largest petroleum producer in November 2012 according to recently released data of the federal Energy Information Administration. In spite of the Obama Administrations hostility to carbon-rich energy private actors with private capital deployed on private (and state) land have launched
a game-changing revolution in domestic oil and natural gas production.
A scarcely reported milestone conveys the magnitude of this turnaround in the global energy landscape.
Over the last five years domestic oil output has risen 40 and continually outpaces projections. Last year domestic output increased by 800000 barrels per day. This is the largest increase in annual production since the first oil well was drilled in 1859 in Pennsylvania.
The U.S. is primed to become the worlds dominating energy powerhouse for decades to come unless President Obama elects to quash this private sector stimulus of enormous proportion.
The Administrations policies have hardly welcomed the oil boom although the president selectively claims credit.
Recall that then-candidate Barack Obama during the 2008 campaign pledged to end the tyranny of oil in our generation as our parents ended the tyranny of Hitler. His administration indeed has done plenty to stymie upstream oil production although to date without the lethal regulatory weapons used on coal.
The uncertain fate of the Keystone XL pipeline the first heavy-handed EPA regulation for hydraulic fracturing endangered species in oil producing regions and indefinitely delayed permits offshore and onshore on federal lands are a few of the obstacles. They all pale in comparison however to the EPAs arrogation of the authority to regulate carbon dioxide.
Ask the coal industry how that goes. Whether EPA initiates the action or not a federal court with the Sierra Clubs bidding could force EPA to impose the same infeasible carbon limits on refineries as EPAs has imposed on coal.
The dynamic entrepreneur that is the American wildcatter has nonetheless brought a colossal energy opportunity to this country.
That domestic production would now surpass that of Saudi Arabia was unthinkable in 2005 when the U.S. imported 60 of crude oil and the gloomy Malthusians declared the irreversible decline of this finite resource.
As history demonstrates it is human ingenuity that turns black goo into black gold and the same mind that continually defies perceived limits.
Imports of foreign oil will fall from 60 in 2008 to likely 30 in 2013. Importing or exporting oil is becoming more a question of geography and price rather than scarcity. But homegrown oil carries advantages. The U.S. typically reaps 10 cents on every dollar of imported oil vs. 80-90 cents on a dollar of domestic oil.
A few Texas examples are irresistible.
The Eagle Ford play could now top the largest play in the world: Kazakhstans Kashagan field.
Our countrys largest conventional oil patch the Permian Basin of West Texas after decades of decline again soars. And the Cline Shale in Texas just beginning development may be more prolific than the Eagle Ford.
The presidents failed economic policies based on public investment in green dreams offer a glaring contrast to the private sectors revolution in unconventional tight oil and shale gas. Creative technologies developed by risk-taking American entrepreneurs catalyzed this energy revolution.
As made in America these technologies not only yield mega benefits for the U.S. they also make the U.S. businesses that developed these technologies the worlds leaders.
If U.S. policy-makers want to support the revolution in domestic oil and gas they might adopt a path typically tough for both sides of the aisle: step back and let private energy markets work.
And resist the urge to federalize fracking. Upstream production has long been under the regulatory purview of state authorities with far more hands-on knowledge of diverse drilling activity. Four decades of environmental regulation well equip state regulators and the industry with effective technological and operational safeguards.
North Dakota issues permits to drill within 10 days. The federal governments time frame is more like 307 days. North Dakota has increased production by 800 in a few years. Production on federal lands declines.
While difficult to imagine that the U.S. would actually ban the now burgeoning oil and gas production as France and some states have done; the policies to do so thrive in the White House and EPA and are legally primed for implementation.
Rejection of this magnitude of wealth creation and geopolitical advantage is however quite a hurdle for even the most reflexive adherent to the dogma known as anthropogenic global warming alarmism.
Savor this milestone. While debt deficit and many grim issues may cast a pall on this nations future celebrate the energy stimulus wrought by the American entrepreneur.
