• Mar 25th 2011 at 7:47PM
  • 38
Let them drill, says the U.S. Department of the Interior. On Monday, regulators approved Shell's offshore plan that calls for the drilling of three exploratory wells in the Gulf of Mexico. Then, on Tuesday, Exxon Mobil was granted approval to drill in the deep waters of the Gulf, marking the fourth deepwater permit issued since the disastrous BP oil spill.

Exxon Mobil was awarded the permit after apparently proving that it can comply with drilling regulations imposed by the Department of the Interior after the Gulf spill. Exxon Mobil says that its well will be equipped with a blowout containment system provided by Marine Well Containment Co. to capture any oil that could otherwise leak into the Gulf in the event of a failure.

Exxon Mobil said in a statement that it supports the government's efforts to resume drilling, but that's what an oil company is expected to say. Right?

[Source: Reuters | Iomage: jkirkhart35 – C.C. License 2.0]


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    • 1 Second Ago
  • 38 Comments
      • 4 Years Ago
      @ Mylexicon -Vs- Noz.

      Most of what Noz posts is emotional, and not very rational. However, Noz does have a point.

      Although speculators are a significant and necessary part of the 'free market', Rampant speculation can be very harmful to economies and individuals. I agree that in the long term the market will always correct itself, but that's small comfort to those individuals and communities who have been devastated by the effects of rampant and irresponsible speculation.

      More insidious, although surprisingly rare, are those ruthless speculators who act in concert to 'rig' the market. This is not only hurtful to the market, but erodes investor confidence and public support for the entire free market system.

      Some regulation is always needed to ensure a truly free market.
      • 4 Years Ago
      About 1/4 of the oil produced in the world is used in the USA; about the half of this oil is imported. So "drill more" has no visible effect on the oil imports.

      There is no real option than to reduce the oil consumption a LOT further than the current plans are.
        • 4 Years Ago
        We import MORE THAN 1/2, closer to 2/3s of the oil we use. And we can't drill our way out of the problem since WE NOT HAVE MUCH OIL and it takes a long time to get it on-line.

        If by some miracle someone was able to drill up the oil really fast so we could burn only USA oil then all that we would manage to accomplish is maybe 5 years of USA-only oil and then 100% DEPENDENCE ON FOREIGN OIL!

        Out of the frying pan and into the fire!
        Noz
        • 4 Years Ago
        Exactly...

        Drilling ONLY serves the purpose of giving the oil companies and associated industries something to do and make more money.....all the while creating ENORMOUS risks environmentally and socially.

        It's only a win for the companies...not for the people or the environment.
      bajohn3
      • 4 Years Ago
      "1. American reserves are more than the total proven reserves on earth (greater than 1T barrels)."

      Source?
        • 4 Years Ago
        @bajohn3
        This is not the original reference, nor is the number as high, but here's something to look at.

        http://www.americanfreepress.net/html/biggest_oil_reserves_182.html
        http://www.usgs.gov/newsroom/article.asp?ID=1911
        • 4 Years Ago
        @bajohn3
        That link from Jordan Templeton III is to a far-right site that denies climate change and denies peak oil. It is basically the Glenn Beck of energy . . . faith-based instead of fact-based.

        The report cited does not say we have lots of oil, it says we have lots of coal and natural gas. Coal and natural gas ARE NOT OIL. Duh.
        bajohn3
        • 4 Years Ago
        @bajohn3
        4 billions barrels is about 200 days worth of oil at our current US consumption rates.
        • 4 Years Ago
        @bajohn3
        D. Sonnier . . . he asked for a link showing 1T of reserves and you provided links showing 3 to 4 billion barrels. Apparently you are not good with numbers since you were a complete order of magnitude off.

        Yes, mylexicon, we have a lot of oil shale. But what good is it if it is not economically viable?!?! If we are going to discuss resources that are not economically advantageous then why not access ones that are infinite and clean? We have lots of solar and power available with economics that are not so great but they are much cleaner and longer-lasting than oil shale.
        bajohn3
        • 4 Years Ago
        @bajohn3
        "Barrels of oil equivalent" doesn't quite work out to 1T barrels of oil does it?

        "Discovered and undiscovered sub-economic resources would include poor-quality or small deposits of conventional oil, some deposits of oil sands, and various other forms of oil deposits such as oil shale."

        "production of shale oil is not yet commercially viable."

        http://epw.senate.gov/public/index.cfm?FuseAction=Files.View&FileStore_id=04212e22-c1b3-41f2-b0ba-0da5eaead952

        Translation, there may be some really crappy stuff spread out all over the place that we can't really get to in an economical way.
        • 4 Years Ago
        @bajohn3
        I'm not worried about the Bakken or Gulf oil estimates b/c they are part of high stakes political subterfuge and industrial trade secrecy. Oil shale is relatively apolitical in comparison b/c it isn't economically or ecologically attractive at the moment. Most geological estimates acknowledge that US oil shale is greater than global P1 reserves.
      • 4 Years Ago
      If you have been following Rachel Maddow on MSNBC you know the blowout preventers on all the new wells are the same as the one that failed on the BP well, it is technically flawed in its design, and the disaster plan being used has not been updated since the BP blowout. They are being granted licenses to kill workers and the Gulf.
      Noz
      • 4 Years Ago
      It goes to show that the BP oil spill was complete swept under the rug and massive amounts of bribery and pay offs were made.

      They have governments in their back pockets. These are the companies that demand we go to war, all bartered and determined in backrooms somewhere....when we should go to Iraq, Afghanistan, Libya, Syria, and now the beginning of Africa and Africom.

      And all we do is keep by crap we don't need, demand more cars, and whine about why fuel prices aren't below $3/gallon.

      Who cares if our reserves are more than enough or not? That's a stupid thing to say. The point is there is almost ZERO effort, proportionally, to try and get off oil...ZERO. The fact that we are unwilling to even use the reserves and continue drilling and creating wars tells me that these freaking companies don't have plans to reduce drilling and consumption.

      What are we going to do when they destroy every pristine square area of this beautiful planet? Then what? What are we going to leave for our children and grandchildren? Oh that's right....we don't give f*k...I forgot.

      bajohn3
      • 4 Years Ago
      "Alternative energy is just an idea in our heads. We have no idea when we can implement the technologies, when they will be widely adopted, or if they will be cost-effective in the near future."

      Eh? They exist right now and can be cost effective right now as well if you look at the true costs of fossil fuels. People are installing solar on their homes and charging their EV's from them right now, their investment will be paid back long before the panels are past their useful lives.
        • 4 Years Ago
        @bajohn3
        No they can't.

        Discounting Nuclear, no alternative energy solution can yet provide sufficient power for an increasingly industrialised world other than fossil fuels.

        But everyone seems to forget that Oil has other important uses than just producing transport fuel.

        We need oil, and we need to conserve oil by reducing non essential uses. This will not be accomplished by silly conspiracy theories or demonising companies and individuals.

        It will be accomplished by serious and responsible incentives.
        • 4 Years Ago
        @bajohn3
        John, solar panels on household roofs? Do you imagine that this tiny amount of savings will have any effect on world oil/coal consumption ?

        That's why people get angry will the ego-centric self-satisfied claims by some environmentalists.

        Extrapolating morally based, anecdotal , statistics is just futile.
        bajohn3
        • 4 Years Ago
        @bajohn3
        I guess you need to inform all the individuals using solar to power their homes and charge their EV's that it's not actually happening.
        Of course oil has other uses, though we are finding substitutes all the time, but if we substantially reduce the amount we burn we'll have more than enough for durable goods.
      • 4 Years Ago
      Getting off of foreign oil:

      Step 1: Drill
      Step 2: Fuel-efficient cars, electric cars, renewable fuel

      At the very least we need to make appear as though we are going to drill so they speculators stop leeching dollars out of our economy.
        • 4 Years Ago
        1. American reserves are more than the total proven reserves on earth (greater than 1T barrels). Our reserves are accessible, but we cannot guarantee environmental safety or cost-effectiveness over time which is why we don't count shale towards our known reserves.

        2. Right-wingers have admitted that drilling won't change the price in the short term. During 2007-2008 when everyone started shouting "Drill, baby, Drill", politicians understood drilling wouldn't have made an immediate impact on the price. Everyone knows that successful drilling project have a long term impact.

        3. I want alternative energy as much as the next person, but the price volatility caused by supply shocks and speculator shocks must be eliminated. If oil needs to be expensive, tax it! Let the government capture some revenue. Don't invent a penny dreadful reason to ban terrestrial drilling, and then pretend it is the intelligent, responsible, thing to do. That kind of narrow-mindedness leads to unnecessary reduction in societal utility. Furthermore, drilling isn't going to stop anytime soon b/c we need natural gas.

        Time to Think is not an appropriate name for someone who believes we need to transition to oil imports and then role the dice on a revolutionary alternative energy solution. That kind of hyper-moral (aka religious) thinking is not appropriate for national energy policy.
        Noz
        • 4 Years Ago
        NO they are not necessary for the market...and NO they are not needed to set prices...where do you get this stuff man??

        The free market is exactly that...free...not created by speculators and destroyed by speculators...you can't have it both ways.
        • 4 Years Ago
        It really depends on what kind of timeframe for recovery you're looking at. If the economics support it, we could be tapping 200-300 bn barrels in Bakken in the 30 years. Of course, "if the economics support it" is a pretty big if. There's a ton of oil down there, but not much of it is currently recoverable.
        • 4 Years Ago
        Yes, oil has other uses than fuel - however, the transportation sector uses a huge percentage of US oil-based consumption. Minimizing transportation sector fuel consumption leaves more than enough left for the non-burning end-uses at sane prices.

        And, no, I'm not suggesting "moving to" imported oil. We already are on imported oil, as others have pointed out.

        I'm sick of wasted resources avoiding the inevitable - the billions spent on extraction, the fuel burned and electricity used to transport, refine, transport again, and pump the fuel, and the 100s of millions spent in lobbying would be far more productive for the companies, and the economy as a whole, if that money and resources were put in to accelerating and implementing alternative energy.
        • 4 Years Ago
        TTT: You hit the nail on the head.

        • 4 Years Ago
        Speculators are part of the free market. I am endlessly amused by all the supposed 'free market' people that become communists when it comes to speculation on oil markets. Even if you wanted to get rid of speculators, you can't . . . the commodity market would just move to another country.

        Go ahead and drill but it won't make much more of a lick of difference. "Drill, baby, drill" is a great bumper sticker for fooling idiots . . . but it won't make a significant difference in oil supplies since we just don't have much oil. If you look at the numbers, you'll see that there has been a 2 year rise in oil production during the Obama administration but if you listen to the right you'd think Obama stopped all drilling.

        The fact is that we have drilling in the USA for 150+ years. We've sucked up most of the oil. We hit peak production in 1970. Drill all you want but we will never have crude oil production that comes close to that.

        Don't listen to me. Listen to what the conservative funder of the "Swiftboat Vets for Truth" oilman T. Boone Pickens says about it. Listen to what the late conservative oil investment banker Matt Simmons said. The conservatives that actually understand oil know the truth . . . but the know-nothing conservative like Palin or charlatans like Gingrich all preach the drill, baby, drill nonsense.
        • 4 Years Ago
        @ mylexicon.

        Unpleasant as it is, there is a good deal of truth in your argument.

        I'm not so sure about your assessment of US oil reserves, but oil is becoming an increasingly high risk, difficult and expensive business to extract.

        When you cut through all the hyperbole, conspiracy theories, and ideologically driven hysteria, you are still left with the need for oil. The US, like every competent government needs to ensure energy security.

        Reliance on technologies which may one day provide something of value, or suggestions to abandon the industrial economy in favour of some impractical moral utopia with a magic power source is nonsense.

        Reductions of oil consumption can only accomplish so much, but that much should be encouraged. The era of cheap oil is over.

        In transport the EV will prove a valuable replacement of oil driven road transport. Bio-fuel will replace marine bunker oil. These technologies exist, and are being developed in efficiency at a rapid pace.

        But in the interim, every last oil reserve must be explored and utilised. We must all grow up, and accept the risk of possible environmental damage, or continue to fight increasingly hypocritical oil seizure wars, like the current Libyan conflict.

        What people like TTT, forget is that oil has other, more valuable uses than just as automotive fuel.
        • 4 Years Ago
        ---Spec, I think you've lost track of the big picture. The kerogen is in the ground. We know we can extract it and make it into oil, and if you assume a 50%-75% conversion rate, we've got about 1T barrels of oil in the ground.

        Alternative energy is just an idea in our heads. We have no idea when we can implement the technologies, when they will be widely adopted, or if they will be cost-effective in the near future.---

        No, *you* have lost track with reality. There is absolutely no commercial operation in the USA where they are extracting Kerogen from oil shale and making oil. None.

        On the other hand, millions of houses have solar panels on them and are generating electricity. Billions of watts of electricity are generated by wind turbines every day all over the world.

        You seem to have some out-dated concept that only fossil fuel works. That is flat out WRONG. Yes, alternatives are slightly behind coal, oil, and gas. But the gap is not very big (and nonexistent in many cases). But alternate energy is more cost-efficient than Kerogen from oil shale. If not, THEY WHY ARE THEY NOT ACCESSING THAT KEROGEN?!?!? The markets say you are wrong.

        Did you know that it is CHEAPER on a fuel basis to drive an electric car powered by solar panels than it is to drive a gas car powered by gasoline?


        --- It wasn't necessary to kill the calculator or the punch card computers to get people interested in PCs. The CD industry didn't have to be regulated and taxed to get iPods to sell. Telephone lines didn't have to be banned for fiber optic to be laid. --

        Calculators, punch cards, and telephones lines do not emit vast amounts of pollution & CO2 that are not captured in their 'cost'. They do rely on sending billions of dollars to unsavory dictators and volatile parts of the world.

        Noz
        • 4 Years Ago
        Spec:

        A free market by definition cannot have manipulation in its mechanism. Speculators manipulate the market artificially...they are NOT part of the free market.

        The housing market is a perfect example of a "free" market gone wrong. Sorry I have to disagree.
        • 4 Years Ago
        Noz,

        Speculators are definitely part of the free market. They are necessary to set prices, conduct arbitrage, pop bubbles (that other speculators create), and various other capital allocation and risk allocation responsibilities.

        Speculation is a double edged sword; however, b/c it requires accurate information and efficient markets in order to keep prices near their intrinsic market value. Does anyone think that the oil markets have efficiency or accurate information? I don't think any industry on the planet has more politicization of numbers. Furthermore, I don't think any industry is more susceptible to misinformation and saber-rattling from oil dictators and petrodollar economies.
        • 4 Years Ago
        Spec, I think you've lost track of the big picture. The kerogen is in the ground. We know we can extract it and make it into oil, and if you assume a 50%-75% conversion rate, we've got about 1T barrels of oil in the ground.

        Alternative energy is just an idea in our heads. We have no idea when we can implement the technologies, when they will be widely adopted, or if they will be cost-effective in the near future. We understand that alternative energy necessary and beneficial for humanity (at the very least in the developed world), but if anything can be objectively construed as hoodwinking, it is our side.

        Alternative energy is a contrarian's/visionary's playground so it is normal that most people are not eager to make the jump. If they are too afraid to make the jump, it is not practical or humane to artificially implode the industry they rely on. It wasn't necessary to kill the calculator or the punch card computers to get people interested in PCs. The CD industry didn't have to be regulated and taxed to get iPods to sell. Telephone lines didn't have to be banned for fiber optic to be laid.

        I mean, do we have something or don't we? Regulating the competition isn't a very strong endorsement of our ideas.
        Noz
        • 4 Years Ago
        Where do you get this information??????????????????

        So we drill...then what????? Do you think a junkie is going try and find alternative when he continues to shoot up???? Because that's exactly what oil consuming countries are.

        If you really wanted alternative energy to catch on, you would sit here sponsoring more drilling. You'd demand a reduction in consumption and improvement in alternative energy technologies to occur at a faster pace.

        The amount of money these freaking oil companies are going to pour into building these monstrosities out in the middle of these pristine oceans will pay for decades of alternative energy research and development.

        They have the money, they have means, but they don't care and don't want to do it...period.

        These deep sea piles of crap are going to have decades of environmental repercussions and impact.

        These are not overnight projects and are not to be viewed as short-term solutions..these bastards know
        exactly what they are doing so wake up and realize it.
        • 4 Years Ago
        "The total amount of oil left in US soil and under US waters isn't enough to supply the US for a year."

        That is too pessimistic. We do have a fair amount of oil left but not huge quantities. But the amount we could "supply the US for a year" number doesn't really matter much because it could never be produced that quickly.

        And it is really REALLY stupid for us to accelerate drilling since then we will just run out of our oil faster . . . why not use other people's oil and save ours until the price gets higher.

        In reality, that is what we are doing with ANWR. ANWR will be drilled eventually . . . but I'm happy with deferring the drilling since it will be worth more later than it is now. The right just wants to spend the money now like drunken sailors.
        • 4 Years Ago
        The total amount of oil left in US soil and under US waters isn't enough to supply the US for a year. This doesn't do anything. Even right-wing analysts have openly admitted that more drilling isn't going to affect prices - why? Because we don't have enough to affect prices. It's just another get-rich-quick scheme by Big Oil before enough people wake up to the futility and environmental costs and outlaw the drilling entirely. They know it's coming, so they are pushing for these permits now, while they still can rape us all for a buck.
        • 4 Years Ago
        "1. American reserves are more than the total proven reserves on earth (greater than 1T barrels). Our reserves are accessible, but we cannot guarantee environmental safety or cost-effectiveness over time which is why we don't count shale towards our known reserves."
        -----------
        That is pure BS. Find a link that says that. You've been suckered by charlatans. We have very little crude oil. Yes, we have a lot of oil shale which contains NO OIL AT ALL. It contains kerogen. We do not use the oil shale because it is not economically viable. Maybe it will be at $200/barrel but no one is using it right now.

        Seriously . . . you have been hoodwinked by charlatans saying "We have lots of oil but the problem is all those dirty hippie tree-huggers." That is simply not true. That is faith-based energy policy from people that still can't admit biological evolution is true.
        • 4 Years Ago
        Noz, I suspect you have no formal education regarding economics or market-based financial systems so I won't belabor the point. If you have no speculators, your market system must rely on auctions to price goods and perform arbitrage. Auctions have their own difficulties, and if your market is restricted to auction-activity-only, it isn't very free.

        I get this "stuff" from studying and from reading studies conducted by other people (both theory and observation) about human behavior. Lot's of people know this "stuff" it is perplexing that you have not been exposed to it.
        • 4 Years Ago
        Easier
        Make Canada the 51st state.
      • 4 Years Ago
      What could possibly go wrong?

        • 4 Years Ago
        Damn Skippy! Drill baby, drill!
        After all we are stopping Gaddafi from killing his people and securing the oil wells to resume our oil shipments as a result, this is the least we can do. I should say Britain's oil shipments as they only have capacity to refine this wonderful sweet light crude that comes from Libya. Having said that, it is a world market so we are effected.
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