Friday, September 26, 2008

Monday, September 22, 2008

Sarah Palin, energy expert?

Remember those times in college when instead of doing the reading for your class the next day, you went out partying with your friends? And remember how when your professor asked you about the material you didn't read, you stammered, and hemmed and hawed, and finally just said whatever came to your mind, hoping beyond hope that it was at least mildly coherent?

Apparently, six colleges later, Sarah Palin does too.

At a town hall on Wednesday night, Palin was asked how she would keep domestically produced oil and coal in the U.S. Here's her answer:

Of course, it's a fungible commodity and they don't flag, you know, the molecules, where it's going and where it's not. But in the sense of the Congress today, they know that there are very, very hungry domestic markets that need that oil first. So, I believe that what Congress is going to do, also, is not to allow the export bans to such a degree that it's Americans who get stuck holding the bag without the energy source that is produced here, pumped here. It's got to flow into our domestic markets first.

One courageous blogger, Hilzoy at Obsidian Wings, attempted to decipher Palin's response. Hilzoy thinks, with good reason, that Palin might have been suggesting a ban on oil exports.

That seems like a bad idea.

While Canada and Mexico are the two largest importers of U.S. crude oil and petroleum products, they're also our two largest suppliers. It's probably not smart to risk a trade war with them.

So perhaps John McCain overstated the case just a bit when he said that his running mate "knows more about energy than probably anyone else in the United States of America."

― Vincent Rossmeier

Sunday, September 21, 2008

Congressional craziness

Congressional craziness keeps United States in much hot water

WE KEEP LOOKING for an expert to explain why the economy is such a mess, but haven't seen anything thoughtful and comprehensive yet. So we'll offer our own. At least two big problems can be blamed in large part on foolish government decisions.

Why are energy costs so high, triggering inflation throughout the marketplace? Why, indeed, since the United States has huge untapped energy resources in oil, gas, coal and tremendous potential in nuclear energy. Then there are renewable sources like hydroelectric, wind and moving water energy.

Some of the problems are in developing technologies, but the nation's vast oil, gas and coal resources are largely off limits to exploration and production because Congress (with a little help from presidents like Bill Clinton) made them that way.

That makes the nation dependent on foreign sources, especially the Middle East, which is now an economic lifeline and must be defended with the lives of young soldiers and the fortunes of average taxpayers.

Many politicians have sold their souls to environmental activists and fight to block oil and gas drilling and coal mining within and around the country's borders. When the subject comes up of drilling in ANWR, a huge oil and gas reservoir, critics argue that it will take 10 years to tap ANWR. "That won't help today," they say. But legislation opening ANWR was passed by Congress in 1995, more than 13 years ago. The field could easily have been in production by now.

And why does it take 10 years to get a new field into production? Mostly government regulation and red tape. It's impossible to believe that process couldn't be speeded up and due consideration still given to environmental protection and public opinion.

Then there are the stock market gyrations triggered by a collapse in the mortgage lending field. Why did that happen? Because Congress mandated that poor people should be able to buy houses whether they could afford them or not. And the rules were loosened enough that liar's loans allowed even middle class people to buy larger and better houses than they could really afford if they wanted to bet that their income was going to go up later on.

Those who sold mortgages to people who couldn't afford the payments or were at risk of defaulting made their money on the paperwork. Afterward they laid off the loans on larger lenders who tried to make their money by buying mortgage paper in large amounts. It should be no surprise that eventually the system collapsed.

These things are all craziness, folks. They just should not be. The United States could be a wise shepherd for its natural resources and still extract them in a timely fashion without damaging the environment. Doing so would create millions of jobs as well as provide the nation with major sources of energy on its own soil.

America needs reform, all right. Most of these problems stem from congressional idiocy. How you fix that is a difficult question. We don't have the answer, just the question.
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Sunday, September 7, 2008

Palin requests a conference call with oil executives

Governor Sarah Palin has requested a conference call this week with the CEO's of the major oil companies playing a role in the potential development of Alaska's natural gas pipeline.

The requested participants include Tony Hayward from BP, James Mulva from ConocoPhillips, Rex Tillerson from Exxon along with others. According to my source, no one knows exactly what the purpose of the call is, but some have never the less speculated.

Last week in her address to the nation, Palin stepped far over the line of truthiness (thanks Steven Colbert) when she told the country, "I fought to bring about the largest private-sector infrastructure project in North American history. And when that deal was struck, we began a nearly forty billion dollar natural gas pipeline to help lead America to energy independence."

Nothing could be further from the truth.

In fact the state has done little more to move the gas pipeline forward over the last twenty months than to grant a Canadian company $500 million to push paperwork with no guarantee a pipeline will be built.

Anchorage Daily News reporter Wesley Loy reported last month;

Palin said in her press conference that the state never before had commitments to build this line. Now we do. That's incorrect.

TransCanada has not promised to actually build the gas line, one of the state's grandest and most frustrated economic development dreams.

The state license, awarded under the Alaska Gasline Inducement Act, or AGIA, which the Legislature passed at Palin's request last year, is not a construction contract and does not guarantee a pipeline will be built."

Since becoming Alaska's governor in December of 2006, Palin's administration has had a very combative relationship with the oil & gas industry in Alaska and has ignored any attempts to communicate with them on development issues.

When the Alaska Gasline Inducement Act (AGIA) was introduced and passed by the legislature in 2007, the administration refused to entertain suggestions from the producers to make the process more commercially viable. At the end of the day the state had crafted a proposal that ignored all legal and fiscal realities.

So instead of negotiating with the producers, the administration said they'd rely on public and share holder pressure to force three of the largest oil companies in the world to commit to paying for the most expensive privately financed project in the history of the United States.

Even United State Senator Ted Stevens raised serious concerns about the process back in March saying; "financing terms won't be set by the legislature, the governor or the Congress. They're going to be set by the people who manage the money."

Today, the state has awarded a $500 million inducement and exclusive rights to TransCanada, while their CEO is on record as saying that they cannot order one piece of steel pipe without first gaining the financial support from the oil companies. "Nothing goes ahead unless Exxon is happy with it," CEO Hal Kvisle told the Toronto Globe and Mail in August.

So what could the agenda be on this requested phone call by Governor Palin?

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