According to a Reuters article written by Tom Doggett that ran in mid-February, not expanding domestic drilling could cost the US $2.4 trillion over the next two decades. And US imports of oil, petroleum products, and natural gas could increase by $1.6 trillion over the period without access to these energy resources. These numbers come from a report prepared for the National Association of Regulatory Utility Commissioners by SAIC Corp., a consulting service based in McLean, Virginia. The report also says that the US is expected to pay OPEC $607 billion for an extra 4.1 Bbbl of crude over that twenty-year period. Congressional and presidential bans on drilling in most US offshore areas outside the western and central Gulf of Mexico ended in 2008, and the Department of the Interior is now considering whether to expand exploration in a very small part of the formerly closed areas. The article quotes President of the American Gas Association David Parker’s view that something needs to change. “It’s clear from this report that the status quo on energy production simply won’t suffice. We encourage lawmakers to heed the results of this study and take a closer look at the energy-rich areas in our country that are currently off limits.” Unfortunately, at a juncture where an informed decision could make the difference between ensuring energy dependence and approaching energy independence, the US is about to head down the wrong path. According to the Reuters article, this study raised estimated US oil and gas resources available in all areas based on advanced drilling technology and easier development of shale gas. Crude oil estimates were increased by 43 Bbbl to 229 Bbbl, and natural gas was raised by 286 Tcf to 2,034 Tcf. Though many within the US like Republican Governor of Virginia, Robert McDonnell, want to increase offshore drilling, (see last week’s blog) legislators continue to stand in the way. Perhaps a serious look at the numbers could alter our course.
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