July 7, 2010

Pyle:Independence Day a Reminder of How Thoroughly Dependent We Are On Others forthe Energy We Need to Survive – Thanks in No Small Part to Our Government. IER president Thomas J. Pyle writes (7/6) forthe Daily Caller,"Happy Dependence Day! This weekend, we celebrated our nation’s most importantholiday-the birth of this great country and the freedoms and liberty itprovides us.  But while we celebratedour independence as a nation, we continue to face increasing and alarmingdependence in our energy sector, the lifeblood of our economy. There is nodoubt that the moratorium will lead to higher energy prices-a fact the markethas already started to digest. Additionally, thousands of oil rig workers areout of work.  And though themoratorium has been called a temporary "pause" in drilling and production,those thousands of unemployed workers have little reason to believe that theenergy companies that previously employed them will allow their extraordinarilyexpensive equipment to sit idle off our coast when other nations welcome theinvestment, jobs, and affordable energy resources these wells provide. Wecelebrated our independence Sunday by driving to visit family, grilling outwith friends, or even basking in the comfort of air conditioned homes. Weshould all take a moment to consider how important energy is to our Americanway of life.  And then rememberthat while we may celebrate Independence Day, a federal government that keepsenergy under lock and key ensures that we are anything but.

Speaking Of: In Matter ofMonths, Imports of Russian Crude to U.S. West Coast Go from ZERO Barrels a Dayto 100,000. WallStreet Journal (7/6) reports, "Russian oil has taken an unexpected turn tothe U.S., where it is making inroads on the West Coast. Oil refineries spanningthe area between the Puget Sound in the Pacific Northwest and greater LosAngeles have been quick to try out oil that is landing in tankers sent fromRussia’s eastern coast. Imports have gone from zero to an estimated 100,000barrels a day in a matter of months since a pipeline bringing crude from deepinside Eastern Siberia came online. The influx has held down fuel prices inplaces like California, which often has the highest gasoline prices in the U.S.Traders have been caught off guard because the oil pipeline was built to targetfast-growing Asian markets. Few people expected to see so many tankerloadsreach U.S. shores. Russia, which only recently joined the list of the top oilexporters to the U.S., is set to climb those rankings thanks to the EasternSiberia-Pacific Ocean pipeline, or ESPO. "Russian crude will beimportant," said Amrita Sen, a commodities analyst for Barclays Capital inLondon.

Doublin’ Down: Obama Admin AsksFederal Court to Reinstate Sweeping Moratorium on Energy Development Offshore -Jobs, Revenue, People Be Damned.  WallStreet Journal (7/6) reports, "The Obama administration asked a federal appealscourt Tuesday to reinstate a moratorium on deepwater petroleum drilling, sayingit is needed to reduce the chance of a second spill similar to the one nowspewing crude into the Gulf of Mexico. In a filing with the U.S. Court ofAppeals for the Fifth Circuit, Justice Department officials said a six-monthsuspension of drilling in more than 500 feet of water is in the "long-termpublic interest of the nation," and is needed to give the InteriorDepartment time to develop and implement new regulations to prevent anotherspill. The filing was in response to a federal judge’s decision in June toblock the moratorium, saying the Interior Department had trivialized theeconomic impact of the temporary ban. In the filing, the administration citednot only the "catastrophic impacts" of the accident on the DeepwaterHorizon drilling rig but also the risk of a second spill, "which industryhas shown limited ability to contain." In Louisiana, many politicians havesaid the ban is crippling an economy already walloped by curtailed fishing anda loss of tourism.

Legal Filing From InternationalAssociation of Drilling Contractors (IADC) Argues Continuation of ObamaOffshore Ban Will Increase Oil Spillage in the Gulf. HoustonChronicle (7/6) reports, "The Obama administration’s ban on deep-waterdrilling is arbitrary, unfounded and will cause "a catastrophic loss ofjobs," the International Association of Drilling Contractors argues in anew legal filing. The IADC questions "whether the local economy can evensurvive the moratorium," as across the Gulf Coast, rig workers are laidoff, contractors lose work and suppliers of everything from rope to groceriessee their sales plummet.  "Oneof the most ruinous effects of the moratorium is that it will drive mobile rigsto leave the Gulf for the waters of foreign countries," the associationwarns. As a result, the ban "will necessarily decrease U.S. oil productionand thus increase America’s dependence on foreign oil." The group goes onto note that because of the record of oil spills from tankers — generallyhigher than spills from blown-out wells — "the moratorium will increasethe risk of oil spillage in the Gulf." The association made its case in afriend-of-the-court brief as the 5th Circuit Court of Appeals in New Orleansprepares to hear an hour of arguments Thursday over whether it should stay atrial judge’s decision to block the ban.

Funny How: EPA’s Modeling NotSophisticated Enough to Estimate # of Jobs Lost from Its Policies, But Has NoTrouble Modeling # of "Lives Saved" (!) from NOx and SOx Rules.  Politico (7/6)reports, "EPA’s proposed Clean Air Transport Rule is the administration’s mostambitious effort to date to tackle conventional smog- and soot-formingemissions. The agency said its standards, when finalized next year, would leadto hundreds of billions of dollars in public health benefits and help avoid asmany as 36,000 premature deaths every year.  "We believe that today is marking a large and important stepin EPA’s effort to protect public health," said the agency’s top air pollutionofficial, Gina McCarthy. The EPA rule is more aggressive than an earlier effortin 2005 during President George W. Bush’s administration. A federal appealscourt struck down that standard, known as the Clean Air Interstate Rule,forcing EPA to go back to the drawing board to justify its limits for curbingsulfur dioxide and nitrogen oxides, pollutants linked to chronic and acutebronchitis, heart attacks, asthma, acid rain and poor visibility in nationalparks. Environmentalists are already ratcheting up their campaign to stop anypotential changes to the EPA’s air pollution rules, even if offered in exchangefor their long-sought goals on global warming. "I expect that overreaching fromthe utility sector," said John Walke, a senior attorney at the NaturalResources Defense Council. "They’ve been doing that for three decades."

Dream Team: Texas Gov. AssemblesBest and Brightest to Ask and Answer Toughest Questions on How and Where WeWill Produce Oil and Gas in the Future. AssociatedPress (7/6) reports, "A new group will pool Texas’ brightest minds to comeup with better and safer ways of drilling and producing oil and natural gas inthe wake of the Gulf oil spill, Gov. Rick Perry announced Tuesday.The GulfProject will focus on developing and testing current equipment as well as newtechnologies for the next generation of oil and gas drilling, Perry said. Thegroup also will look to develop better ways of monitoring the equipment onceit’s in place and improve training for responding to oil spills. "Texasmust take the lead in this effort because Texas leads in energy," Perrysaid at a news conference at Johnson Space Center, which he suggested couldhelp in testing new equipment. "We are perfectly suited to lead the effortinto improving safety and reliability in our continued quest for new and bettersources of energy." Texas’ energy industry supplies 20 percent of thenation’s oil production, one-fourth of its natural gas production, a quarter ofits refining capacity and nearly 60 percent of its chemical manufacturing. TheGulf Project will be comprised of researchers, policy experts and stateofficials. But Perry also called on the oil and gas industry to join in itsefforts.

Plane Stupid: Swiss Pilot Slatedto Go on World’s First (and Last) 24-Hour "Solar Flight" Cancels Trip at LastMinute – Maybe ‘Cuz Aircraft Only Travels 44 MPH. HoustonChronicle (7/6) reports, "A Swiss pilot was expected to go on the world’sfirst 24-hour solar flight in an ultralight plane with 12,000 solar cells gluedto its wings tomorrow, ClimateWire said. But the flight was postponed for thesecond time due to technical difficulties. Weather permitting, pilot AndreBorschberg was to fly the plane all day to soak up the sun’s rays and then flythrough the night, waiting for dawn for the batteries to recharge again. TheSolar Impulse HB-SIA plane, with a wingspan roughly the size of a Boeing 747jumbo jet, but around the same size as a family car, uses solar cells to powerfour electric engines and recharge lithium batteries. The plane travels at anaverage speed of 44 mph and can go up to 26,000 feet, ClimateWire said. Theflight is propelled by 40-horsepower electric engines, roughly the same poweras a scooter. The website said they are unable to announce another date for thenext trial yet, but promise to update with further information as it develops.