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By Paul Losch

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About this blog: I was a "corporate brat" growing up and lived in different parts of the country, ending in Houston, Texas for high school. After attending college at UC Davis, and getting an MBA at Harvard, I embarked on a marketing career, mai...  (More)

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Gas--North of 4, Heading Toward 5

Uploaded: Mar 3, 2012
I tanked up my Prius the other day. $4.25/gallon. Glad I get 40+MPG.

I recall a few years ago when gas prices for a time went over $4. "W" was President at the time, and he expressed surprise at a press conference that gas prices had crossed that threshold. "Out of touch?"

I live in a neighborhood that could be called "Prius Nation." I have not done a scientific count, but my sense is that at least one half of the folks on my block have a hybrid car.

This leads to a larger issue, some of it economic theory and some of it national policy.

Economic theory: supply and demand. Energy takes many forms. It is getting increaslingy expensive for the most part. It is a global matter, not a US matter alone.

Focusing on gasoline, go visit China or India to understand what is going on. Demand is increasing worldwide, supply for oil has not kept pace.

As for other energy sources, nothing comes easy. Solar, nuclear, fracking, inter alia take time to develop, and are better sources of future energy than is gas.

What's more, (and I am guilty as charged,) there is so much waste. In my case, the house I live in was built in the 1920's, and it leaks so much through its single pane windows to make your head spin. I cite myself as an example, and there are folks like me all over the place in the same situation.

Policy: I find tiresome statements that gas prices can go back to $2.50 or less. I also find tiresome those who argue against developing alternative energy sources. This largely rests with the private sector, the Shells and Chevrons of the world, but there is a role for our national government in fostering developments that will provide for future energy demand.

Comments

Posted by end the subsidies, a resident of ,
on Mar 3, 2012 at 9:29 am

News reports say that the market price of gasoline should be more than $10 per gallon (some say $15 per gallon). The pump price is under $5 because of government subsidies. Are all these subsidies really fair to the taxpayer, especially taxpayers that don't drive very much? Why don't we let gasoline float to the market value and let people adjust their behavior accordingly?


Posted by Oil Sam, a resident of ,
on Mar 3, 2012 at 9:54 am

The last 8 years have proved the fallacy of "drill baby drill".

Yes, Sarah dear, it's a sham.

We have been drilling. America is producing more oil now than 8 years ago. Look it up: Obama's America produces more domestic oil than during Bush's 2nd term.

Rigs? "The U.S. has more oil and natural gas drilling rigs than the rest of the world <COMBINED>. The number of rigs have exploded in the past three years to 1,272." Web Link

Did prices go down? No. That oil goes onto the world market. America is now a net exporter of oil. The Keystone pipeline is just a method of taking the existing Keystone pipe (that currently ends in the Midwest) down to Texas so the oil can be exported.

Druggie Limbaugh and the rest of the whacko right wing fringe that have used the same talking points memo this week (Obama loves algae!) won't mention the truth to their sheeple.

We must develop all resources at our disposal.

Pay for it with the $4 billion a year in corporate welfare given to big oil. Why are we giving tax dollars to the most profitable industry on earth???????????????? Web Link

How much federal corporate tax does Exxon pay in return? (hint: in 2009 - zero.)

The problem is speculation artificially driving up prices. It helps the oil companies post record profits and high oil prices support their high stock rice (stock price is partially dependent on the artificially inflated value of existing oil reserves under contract.)

Step one: take the corporate welfare for big oil and use the investment for alternative fuels

Step two: revamp the market so that those speculating in oil futures must have the wherewithal to actually take delivery of the product on which they are contracting.

Step three: knock off the Iran noise, McCain. all that talk drives up the price of oil and benefits IRAN, you old fool.

Can we get oil down to Clinton era costs (under $20 a barrel, a fifth of it's current cost)? Don't know - the fiasco in Iraq had a huge effect on oil, just as Osama bin Ladin predicted in the 90's, and Bush/Cheney willingly obliged.


Posted by Kevin, a resident of ,
on Mar 3, 2012 at 1:44 pm

This country is awash in natural gas (NG), due to new drilling technologies. The average price for a unit of NG has decreased by over 50% in the last four years. This is, indeed, a case of "drill-baby-drill" increasing the supply relative to demand.

T. Boone Pickens has made a very logical suggestion that all fleet vehicles go to NG...then start with the personal vehicles.

The problem with high fuel prices for transportation is that it is inflationary, and that is a very regressive tax.

For all you plug-in Prius types out there, imagine if the majority of the country plugged in to recharge their batteries? This would immensely increase coal mining to provide the additional electrical base load. Let us not forget all the environmental destruction done to provide the minerals to produce those batteries.


Posted by Paul Losch, a resident of ,
on Mar 3, 2012 at 2:03 pm

Paul Losch is a registered user.

Another thought that I did not bring up in my initial posting.

Gas prices can fluctuate (up not down these days,) and yet there is a continued opposition to a tax that could pay for transportation and energy development.

I don't get it.

The price of gas spikes nearly a dollar or more, and the country just deals with it.

The notion of adding a tax on that same gas, say 25 cents, to fund algernative energy sources and enhanced mileage for autos is vilified.

I don't get it.


Posted by Kevin, a resident of ,
on Mar 3, 2012 at 2:20 pm

"Gas prices can fluctuate (up not down these days,) and yet there is a continued opposition to a tax that could pay for transportation and energy development."

Gasoline prices are up, probably will continue to trend up, over time, but natural gas will probably continue to trend down (supply and demand, as always). Cheap NG transporation would be a very progressive tax break for the relatively poor. Yet, there are calls for a tax on gasoline (a VERY regressive tax, btw), in order to provide development funds for the likes of Solyndra, along with all the cronyism that that implies.

Do we really needs to cover our deserts with solar panels and industrialize our remaining mountain ridges with wind turbines, simply because we fail to use the abundant natural resoruce that is avaialable to us, namely NG.


Posted by Bobbie Jen, a resident of ,
on Mar 3, 2012 at 3:28 pm

NG is part of a longer term solution (effects of carbon and fracturing aside.) Add the infrastructure; it's part of an "all of the above" set of solutions for America.

"Do we really needs to cover our deserts with solar panels"

Huh, spreading fear much? How about starting with rooftops. If Germany can do it and make it work in their northern clime, then why won't it work here in America. Germany has over a million homes under solar panels, and large solar parks as well. Added benefit to local panels: less energy lost in transmission. Let's spend what we spent on Iraq and put solar on ten million rooftops. Let's nation-build at home, hire the vets to put them up.

Use the subsidies being given to Exxon, etc., as previously highlighted.

I forgot about Bin Ladin: when oil was 12 bucks a barrel 15 years ago (wow, you go, Bill Clinton!!) Bin Ladin said it was his goal to get it to $144 a barrel.

Who knew he needed Dick Cheney to make it happen? Right there in 2008, right on schedule, Cheney got it to $144 a barrel.




Posted by Kevin, a resident of ,
on Mar 3, 2012 at 4:01 pm

NG is here and now. All that is needed is more filling stations, then the market will provide the demand for more CNG vehicles.

Our natural enviroment is currently being covered with solar panels in the desert, and industial wind turbine plants on our precious mountain ridges. Even if all the rooftops in the U.S. were covered with solar panels, it would still not provide the base load energy required to meet current and future demand. The sun does not shine at night.

Germany is hardly an example of good behavior. It is currently multiplying its brown coal production, as a cover for its flawed policy of solar panels and shutting down its nuclear power plants.


Posted by Bobbie Jen, a resident of ,
on Mar 3, 2012 at 4:22 pm

"Our natural enviroment is currently being covered with solar panels in the desert, and industial wind turbine plants on our precious mountain ridges"

Show me.

"Even if all the rooftops in the U.S. were covered with solar panels, it would still not provide the base load energy required to meet current and future demand."

It's an "all of the above" set of solutions.

To disparage Germany without any evidence just to show what you feel is a superior "my way or the highway" answer is folly.

China has invested billions in solar as well.

Guess everyone else in the world of energy is wrong and Kevin is right.

Who'da thunk?


Posted by Kevin, a resident of ,
on Mar 3, 2012 at 5:40 pm

Here is just on example of the solar panel industrialization of our deserts:

Web Link

Wind tubine industrialization of our mountain ridges, including access roads and electric power grids, is well known, along with the mass killing of birds of prey.

Germany's massive increase in brown coal mining is established fact.

China has invested many $billions in nuclear power. Solar panels are more about exports, than about useage in China. China understands where the action is. Similar to Germany with wind turbines.

Natural gas is the path to prosperity in the U.S. T. Boone Pickens got it right.

Kevin actually studies this stuff.


Posted by Bobbie Jen, a resident of ,
on Mar 3, 2012 at 5:58 pm

Wow. A whole 8k acres means we have "cover<ed> our deserts with solar panels". Why sahucks, we hardly have any desert left.

Besides Altamont, how many acres covered are "industrialization of our mountain ridges" with turbines?

Yes, Kevin admits he "knows his stuff". So modest and humble, too. He knows enough to spew forth about anything that doesn't agree with his NG agenda. Just enough, without backing any of it up. Why, when I grow up, I want to be just as smart as Kevin!

NG NG NG. That's it folks - nothing else to see here!

A little knowledge is a dangerous thing.


Posted by Kevin, a resident of ,
on Mar 3, 2012 at 8:08 pm

Bobbie, simple question:

How much electrical power is generated per sqare meter by a solar panel. Assume optimum conditions, then extrapolate over the various real world conditions, including night time, cloud cover, efficiency of of the solar panels. Then tell us all how many acres of California desert would be required to satisfy the expanded demand for electricy do to plug-in Priuses.


Posted by Bobbie Jen, a resident of ,
on Mar 3, 2012 at 9:15 pm

If you've got the math - share it. Prove the Germans, China - everyone's wrong. Still waiting for your calculation on how much of California's total desert that the 8k acre solar farm is going to destroy. According to Kevin, its "cover<ing> our deserts with solar panels"

But heaven forbid, you shouldn't go back and review and find the phrase: "It's an 'all of the above' set of solutions."

Or go with Kevin - "NG NG NG. That's it folks - nothing else to see here!"


Posted by Sharon, a resident of ,
on Mar 3, 2012 at 11:11 pm



On an energy equivalence basis gasoline is 40 times more expensive than natural gas.

In fact we have enough oil and natural gas in the US to meet our needs for the next 200 years.

Restrictions on oil drilling and the devaluation of the dollar are the reasons for high gas prices.

Germany has ended its subsidies for wind and solar power--why--because they do not work-they are a boondoggle.

Try driving your prius up to Tahoe in the winter--you will get 19 mpg if you can move at all

Try driving a prius in the desert in the summer with the AC on -you will get 19 MPG if you are lucky.

When the prius batteries die in a couple of years the replacements will cost the owner $ 7,000

Good luck with the resale value


Posted by Sigh..., a resident of ,
on Mar 3, 2012 at 11:42 pm

"Try driving your prius up to Tahoe in the winter--you will get 19 mpg if you can move at all"

Not true. I still get >40mpg.

"Try driving a prius in the desert in the summer with the AC on -you will get 19 MPG if you are lucky."

Not true. I still get >40mpg.

"When the prius batteries die in a couple of years the replacements will cost the owner $ 7,000"

Well, my batteries are going on 8 years so far with no issue. The warranty is for 10 years here in CA (8 years in some other places). The replacement cost is ~$2500, not $7000.

Look, there are plenty of legitimate concerns with alternative energy sources. By lying about things, however, it just discredits anything else you say, even if some of it may be valid.


Posted by Walter_E_Wallis, a resident of ,
on Mar 4, 2012 at 5:50 am

Walter_E_Wallis is a registered user.

Eliminate ALL energy subsidies now. Define a subsidy as a direct payment from government to the producer. A severance credit against income is NOT a subsidy.


Posted by Kevin, a resident of ,
on Mar 4, 2012 at 9:28 am

Using publicly available peak power production for solar farms, one acre of solar panels in the desert will produce about 125 kW. Given that peak power is not steady state power, along with cloud cover issues, assume a 50% reduction, thus 62.5 kW. Over an 8 hour day this is 500 kW-hrs.

A typical Prius charge requires 3 kW-hrs. Thus about 166 Priuses can be charged from one acre of covered desert land. One million Priuses would require about 6,000 acres.

Solar energy is being mandated by the State for all electrical demand, not just-plug-in vehicles (which constitute added demand). If one wants to think about the acreage required to become fully solar powered, just take the current and projected electrical useage, in kW-hrs, and divide by 500. This is a huge amount of potential acreage of desert lands.


Posted by Bobbie Jen, a resident of ,
on Mar 4, 2012 at 9:53 am

Without challenging your apparent bias in your "assumptions", let's look at your statement: "cover<ing> our deserts with solar panels"

You've gone from an 8k acre example to a hypothetical of "One million Priuses would require about 6,000 acres. "

The Mojave Desert is 32 million acres.

Keep spinning.

"cover our deserts with solar panels"

Yet again, attempt to fathom: "It's an 'all of the above' set of solutions."

Sharon: "Restrictions on oil drilling " Sorry, Sharon, drill baby drill has been discredited. Try again with another conspiracy theory.

As shown above by Oil Sam: America is producing more oil now than 8 years ago. Look it up: Obama's America produces more domestic oil than during Bush's 2nd term. Rigs? "The U.S. has more oil and natural gas drilling rigs than the rest of the world COMBINED. The number of rigs have exploded in the past three years to 1,272."

Did prices go down? No. That oil goes onto the world market. America is now a net exporter of oil.

Sam nailed it.




Posted by Kevin, a resident of ,
on Mar 4, 2012 at 11:41 am

"The U.S. has more oil and natural gas drilling rigs than the rest of the world COMBINED."

"Did prices go down? No. "

Most of those newer rigs are for natural gas, and YES the price of natural gas has plummeted. "Drill-baby-drill" absolutely works for natural gas. In fact, the number of new rigs for NG is now decreasing, because the new discoveries are so abundant.

An "all-of-the-above" approach works when their is scarcity. But we do NOT have a scarcity, anymore. We have NG and nuclear. Why would we want to cover up our deserts? Kill our birds of prey? Industrialize our wild areas?

Let us not forget the increased costs of alternative energy strategies. These costs are passed on to the consmer as an inflationary fraction. This is a hidden tax, and a very regressive one (the rich don't much care, but the poor are hit very hard).

When we have been handed a near-free lunch (NG), why should we be forcing other sources? Let these alternative find their own niche, according to market demands. NG is here-and-now...ready to go!


Posted by Bobbie Jen, a resident of ,
on Mar 4, 2012 at 12:14 pm

Snore. On whose NG payroll are you? Are are you just a Pickens fanboy?

Laying back on the covering deserts after the 32 million acres figure, at least.

Okay, Kevin wins. It's all NG, all the time! No need for any alternative sources of energy, let's burn gas. No need to conserve and we can tear down damns because we will no longer need hydropower.

Welcome to the utopian world of NATURAL GAS!

All those others experts and countries betting billions upon billions upon billions on other forms of energy are losers! Why can't Detroit see their salvation is in NG? If they only listened to Kevin!

All hail Kevin, the king of natural gas.

Snore.

Except Kevin paints a rosy picture without fact. "Most of those newer rigs are for natural gas" That's wrong. The 1272 rig figure quoted above is for OIL rigs, not NG rigs.

Even the 1272 number is low: "Friday that 1,293 rigs were exploring for oil and 691 for natural gas. A year ago Baker reported 1,707 active rigs.

The rig count peaked at 4,530 in 1981 and bottomed at 488 in 1999."

Remember 1999? What was the per barrel price back then?

The glut of domestic oil has not lowered prices due to speculation. At least Kevin agrees that drill baby drill has been proven false for domestic oil production.




Posted by Walter_E_Wallis, a resident of ,
on Mar 4, 2012 at 12:28 pm

Walter_E_Wallis is a registered user.

So "Don't drill, Baby, don't drill" is the real answer to a gasoline shortage? The increase in oil production currently is the consequence of Bush policies that Obama was unable to quash. Export sales? Hey, the gas goes where the money is.


Posted by Kevin, a resident of ,
on Mar 4, 2012 at 1:33 pm

"The 1272 rig figure quoted above is for OIL rigs, not NG rigs."

"The U.S. has more oil and natural gas drilling rigs than the rest of the world COMBINED. The number of rigs have exploded in the past three years to 1,272"

Sorry, Bobbie, you both those statements, not me.

"At least Kevin agrees that drill baby drill has been proven false for domestic oil production."

No I did not. It all depends on potential supply. We (USA) still have a lot of oil, but we are not going after it, like we could (Obama and his crew have suppressed permits). However, since we have enormous reserves of natural gas, why not make NG a priority? There is no question "drill-baby-drill", both NG and oil, can solve our national energy problems, along with making serious contributions to our national security and balance of payment issues.

Obama and his various greenies WANT higher gasoline prices...better to force the American workers to buy boutique/fringe products like EVs. Lower NG prices are a real killer to that concept. T. Boone Pickens got it right.


Posted by Walter_E_Wallis, a resident of ,
on Mar 5, 2012 at 8:58 am

Walter_E_Wallis is a registered user.

Bill Wattenburg [formerly KGO weekend] has long suggested that the president issue an executive order that all autos purchased by the federal government be dual fueled [CNG/Gas or CNG/diesel]. This would create the CNG demand needed to reduce gasoline prices significantly


Posted by Oil Sam, a resident of ,
on Mar 5, 2012 at 10:50 am

Bobbie didn't quote the 1272 figure - I did. Kevin then said "Most of those newer rigs are for natural gas" and she proved him wrong.

"1,293 rigs were exploring for oil and 691 for natural gas."

Dude, just admit it, the statement "Most of those newer rigs are for natural gas" was wrong.

Then you went after her with "We (USA) still have a lot of oil, but we are not going after it,"

Really, after all the evidence submitted (most domestic production in last 8 years, most rigs in the wold, etc..) you're staying on the "it's Obama fault" RNC talking points?

Drill baby drill has been disproved. Production is up, prices are skyrocketing. Same real world proof as the Bush tax cuts were supposed to create jobs, and jobs plummeted.

Time to regulate the rampant speculation in the oil markets that have driven the prices up, costing everyday working Americans too much.

Time for an all of the above set of solutions.




Posted by Kevin, a resident of ,
on Mar 5, 2012 at 2:13 pm

Sam,

Both of those quotes are from Bobbie's post. She chose to parrot your quote, so she owns it. The quotes are contradictory.

Regarding newer gas wells vs oil wells, you are correct in the current snapshot. However, gas was the rage a few years ago, until so much gas was discovered that the current situaiton is that gas wells are diminishing. For an overview see: Web Link

You can say that drilling is ineffective, but it is obvious that it is effective, when access is given to drilling where the stuff is. The NG story is a huge case in point. Oil rigs are increasing, at this point, because permits were promoted under the Bush administration, not the Obama administration. The proper question is: How many more wells would be in the permit pipeline if Obama had opened ANWAR and offshore (and other) leases?

It is a simple fact that we do not need an "all of the above" approach at this point. NG, oil and nuclear can make us energy independent in a relatively short period of time. Wind and solar are niche players, and neither is base load.


Posted by Oil Sam, a resident of ,
on Mar 5, 2012 at 2:34 pm

Again, Kevin says all of the above is bad. Ignore the billions being invested by other countries, the positive results, all that, just listen to Kevin about natural gas.

Now he insists that drill baby drill is effective, despite all the evidence: most domestic production in 8 years, record numbers of active oil rigs, etc.. leading to today's prices. Funny about that.

So he goes to the ol' rightie drill baby drill mana: ANWAR

"The U.S. Energy Information Administration, an independent statistical agency within the Department of Energy, concluded that new oil from ANWR would lower the world price of oil by no more than $1.44 per barrel—and possibly have as little effect as 41 cents per barrel—and would have its largest impact nearly 20 years from now if Congress voted to open the refuge today."

Oh, those pesky facts and their well known liberal bias.

Not to mention, if domestic production continues to go up, foreign suppliers just adjust accordingly to keep prices high. Speculators too.

Drill baby drill doesn't work in the real world.

"If oil companies wanted to increase production, they could. In March 2011 the Department of the Interior released a report revealing two-thirds of oil-and-gas companies' offshore leases and more than half of their onshore leases are not being produced."

They can produce, but they don't. They have already drilled, baby, they've drilled and the prices are where they are today.

Unless Kevin is suggesting that we nationalize oil or gas, we can't drill our way out.

It's an all of the above approach.




Posted by Oil Sam, a resident of ,
on Mar 5, 2012 at 2:38 pm

Parrot? She recited previously established facts to prove you wrong and you start the digs - nice guy!!

"Kevin then said "Most of those newer rigs are for natural gas" and she proved him wrong.

"1,293 rigs were exploring for oil and 691 for natural gas."

Too bad you can't get past that mistake about "Most of those newer rigs are for natural gas" with your "you are correct in the current snapshot" without the parrot dig.


Posted by Kevin, a resident of ,
on Mar 5, 2012 at 3:34 pm

"Drill baby drill doesn't work in the real world."

Despite the fact that NG drilling proves you wrong, in spades, you keep repeating the mantra. ANWAR has been in discussion for more than a decade, yet the greenies continue to stop it. It was the same with the Alaska North Slope and pipeline. It is the same for off shore drilling. The irony is that NG provides an out for most sides: Pump baby pump! As the supply is drawn down by demand, it will increase via new drilling, because the stuff is there, and it provides jobs and prosperity and national security and reduced balance-of-payment deficits.

BTW, Walter mentioned Bill Wattenburg's idea about a federal government fleet of dual-fuel vehciles. Obama should be pushing this, but I haven't heard a peep. He might be able to do it with an Executive order. At least he can promote it in the bully pulpit. Of course, the reason he will not do it is that his greenie corps will not allow lower fuel prices...hurts their true-believer cause of alternatives and mass transit.


Posted by Oil Sam, a resident of ,
on Mar 5, 2012 at 3:49 pm

"As the supply is drawn down by demand, it will increase via new drilling"

Oil proves you wrong.

"If oil companies wanted to increase production, they could. In March 2011 the Department of the Interior released a report revealing two-thirds of oil-and-gas companies' offshore leases and more than half of their onshore leases are not being produced."

"Drill baby drill doesn't work in the real world" answered with your "Despite the fact that NG drilling proves you wrong" is insane. The reality today with oil and gasoline is just that - reality.

Your, and Walter's, and Wattyberg's, NG fantasy world doesn't change the fact that facts on the ground today in the oil industry conclusively show how DRILL BABY DRILL has been proven wrong in the real world of oil and gasoline prices. Most rigs, most domestic oil production in years + highest prices, while we EXPORT oil!!

Happy now?

It's an all of the above set of solutions that are required.

Drill baby drill has not worked.


Posted by Kevin, a resident of ,
on Mar 5, 2012 at 5:29 pm

"Oil proves you wrong." (re: drilling for new supplies of energy).

Not at all. Oil drilling will increase as it currently is, according to new resoruce areas and new drilling technologies. Try reading the article that I provided for you ( Web Link ). An interesting quote, relative to NG and oil rigs is:

"Natural gas drilling has been the dominant energy story in the U.S. for the past few years, but oil is back with a vengeance.

For the first time in 18 years, the number of oil rigs working in the U.S. has exceeded the number of natural gas rigs, according to July rig data compiled by IHS-CERA, covering both land and offshore rigs."

NG drilling has been a HUGE success. Oil will be slower, given that the current administration is trying to quash a potential oil boom (bad for the greenie agenda). Open ANWAR, offshore, shale...there is a LOT of domestic oil. However, NG is HERE AND NOW!!!

Forget about an "all of the above" model. It is not necessary, and it is very regressive to the poor and middle class. It probably works for Palo Alto liberals and greenies and trust fund babies, but not for the rest of us. The rest of us want LOWER fuel prices, not HIGHER ones! NG is situated in a sweet spot to provide just that.

Where is Obama?




Posted by Oil Sam, a resident of ,
on Mar 5, 2012 at 6:04 pm

"Where is Obama? "

- More rigs currently drilling for domestic oil than the rest of the world combined.

"Where is Obama? "

- Most domestic oil production since 8 years ago.

"Where is Obama? "

- America net exporter of oil.

"Where is Obama? "

- "If oil companies wanted to increase production, they could." (see below for full quote)

More rigs + more domestic production = higher prices?????

drill baby drill has proven demonstrably false with oil and gasoline, yet you keep changing the discussion to NG and claim drill baby drill works for oil and gasoline.

Your "Oil will be slower, given that the current administration is trying to quash a potential oil boom" is also false as per:

"If oil companies wanted to increase production, they could. In March 2011 the Department of the Interior released a report revealing two-thirds of oil-and-gas companies' offshore leases and more than half of their onshore leases are not being produced." How is it Obama's fault they are not producing from existing leases? Want to nationalize the oil companies so we can tell them to produce?

The high price of gasoline has nothing to do with Obama, but everything to do with rampant speculation and oil company manipulation to keep the prices high.

Make all the noise about NG you want, but it won't change the above facts.

But please, don't let that stop you from making a lot of static and noise about NG.


Posted by Kevin, a resident of ,
on Mar 5, 2012 at 6:34 pm

"Make all the noise about NG you want, but it won't change the above facts."

It is a simple fact that NG is a huge new resorce for the here and now. That is not "noise".

The proper question about Obama and his greenies is: How much MORE oil would be coming on board, today, compared to Bush (or similar pro-growth, pro-oil types) in office? The current uptick in oil is despite Obama, not becasue of him. New drilling technology and drilling on private lands, especially in the Pervian Basin is leading the way.

Drill Baby Drill! But also use our enormous supply of natural gas and nuclear power. Wind and solar are an overpromise, and they are not base load.

We need prosperity in this country, not limousine-liberal green dreams.


Posted by Oil Sam, a resident of ,
on Mar 5, 2012 at 7:29 pm

My god.

Go back and read. I have not said NG wasn't a resource. Every time you get stuck losing your drill baby drill point, you retreat back to that, with a side of (somehow) it's Obama's fault.

I have said that current production levels and drilling have proven that 'drill baby drill' is ridiculous - it works as a simplistic theory for the Palin sheep but not in the real world.

Hence: More rigs under Obama + more domestic production under Obama = higher prices?????

We have drilled, baby, and have the highest domestic production in quite a while, yet high oil and gasoline prices.

As far as your weird fantasy of Obama being anti-energy: "If oil companies wanted to increase production, they could. In March 2011 the Department of the Interior released a report revealing two-thirds of oil-and-gas companies' offshore leases and more than half of their onshore leases are not being produced." How is it Obama's fault they are not producing from existing leases? Want to nationalize the oil companies so we can tell them to produce?

How about instead of nationalizing big oil, we take back unused leases and re-auction them off?


Posted by Kevin, a resident of ,
on Mar 5, 2012 at 8:22 pm

The federal government leases potential oil lands at auction. However, it does not record exploration (just final production). Developing leases for production is a very difficult thing. Exploratory wells are a closely held competitive secret. Sam, you don't have a clue what you are talking about.

The truth is that very promosing oil leases are not being offered to auction (ANWAR, off shore in states outside the Gulf of Mexico...and many more areas).

We already have enough NG production and potential to just move forward, thanks to drilling. Now it is time to pump...not sometime in the future, I mean NOW.

This is not the time for alternative energy (it will find its own niche, for example off grid). Save our deserts and mountain ridges and Golden Eagles!


Posted by Sharon, a resident of ,
on Mar 5, 2012 at 8:23 pm


The problem is that we do not have enough oil refineries --we have not built a new one in California in 30yrs and the activists have closed many.

At $ 60 / barrel of oil it is profitable to convert NG into a liquid fuel that can use the existing gasoline distribution infrastructure.

We have enough proven NG to provide fuel for 200+ years.

Germany has ended funding for wind power and solar this week -- because they do not make any economic nor environmental sense--they were a scam and a boondoggle

The fall out from Peter Gleicks theft, fraud and forgery will be huge and devastating

Web Link

--the FBI is now on the case and RICO indictments will follow


Posted by Oil Sam, a resident of ,
on Mar 5, 2012 at 9:59 pm

Kevin:

Tell us about your experiences with your natural gas car.

I imagine Walter, Sharon and Bill Wattyberg can share their experiences as well.


Posted by Walter_E_Wallis, a resident of ,
on Mar 5, 2012 at 10:42 pm

Walter_E_Wallis is a registered user.

There is a world market for oil and petroleum products. Demand is increasing everywhere, not just here. We need to drill baby drill even if our own demand was static.


Posted by Kevein, a resident of ,
on Mar 6, 2012 at 10:49 am

Honda Civic Natural Gas: Green car of the year.

Web Link


Posted by Oil Sam, a resident of ,
on Mar 6, 2012 at 11:07 am

Kevin: How's your Honda Civic been working out for you?

So you just got on the NG bandwagon, or you have had other NG vehicles before your 2012 Honda?


Posted by Not-Convinced, a resident of ,
on Mar 6, 2012 at 11:50 am

> A typical Prius charge requires 3 kW-hrs. Thus about 166
> Priuses can be charged from one acre of covered desert land.
> One million Priuses would require about 6,000 acres.

Assuming that some of this is true, we need to ask:
1) What is the total cost of building all of these solar power farms?
2) What is the cost of operating these farms?
3) What are the long-term maintenance of these farms?
4) What is the cost of transporting this power to its consumers?
5) Since most cars are going to be recharged at night—how does power generated in the day recharge the cars at night?
6) How much security will be required to protect all of this power generating equipment?
7) Who should pay for all of this hardware/labor?

There are too many unknowns here for this to be much of an answer to anything.


Posted by Not-Convinced, a resident of ,
on Mar 6, 2012 at 12:37 pm

> Why aren't people excited about paying a 25cent a gallon tax for
> (government-directed) research into alternative (something
> or other) ..

It's understandable that someone being spoon-fed a lot of environmental pap might say something like this..but for someone with an MBA .. you have to wonder.

Here's a bit of info on gas taxes--
Web Link

United States
Fuel taxes in the United States vary by state. The United States federal excise tax on gasoline, as of February 2011, is 18.4 cents per gallon (4.86 /L) and 24.4 cents per gallon (6.45 /L) for diesel fuel. In January 2011, motor gasoline taxes averaged 48.1 cents per gallon (12.71 /L) and diesel fuel taxes averaged 53.1 cents per gallon (14.03 /L).[9] For the first quarter of 2009, the mean state gasoline tax is 27.2 cents per US gallon, plus 18.4 cents per US gallon federal tax making the total 45.6 cents per US gallon (12.0 /L). For diesel, the mean state tax is 26.6 cents per US gallon plus an additional 24.4 cents per US gallon federal tax making the total 50.8 cents US per gallon (13.4 /L).[10] There are also a few states and municipalities that charge sales tax on top of the excise taxes and the retail price

And for taxes here in California--
Web Link

California
Gas: 35.3 cents
Diesel: 18 cents
Other: 15.2 cents

Other Taxes" columns include a 2.25% state sales tax for gasoline and at least a 1.25% local sales tax for various counties in the state for diesel. The tax rate applied is a weighted average based upon county populations. A 2 cpg state UST fee is also included

So, the current "gas tax" is about 55.5 cents per gallon. This more-of-less fixed-cost, expressed as a percentage of the total cost per gallon, various with the cost of gas, obviously. Another 25 cents would increase the current tax by 50%, however.

So what would this money buy? Well—"research" is a pretty vague term. We can look at the $6B (expenses and finances costs) that has been wasted on Stem Cell Research here in California gives us all a pretty good idea of what we can expect to get back for our money.

And then there is the impact of adding 25 cents/gallon to the cost of everything. At $4/gallon this comes to a 6% increase in the costs of good/services dependent on the use of gasoline in their manufacture, and distribution.

Not a good idea. Not now, and probably not ever.
'


Posted by Oil Sam, a resident of ,
on Mar 6, 2012 at 6:56 pm

[Post removed by Palo Alto Online staff.]


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