As Fracking Corps Have 'An Enron Moment' Congressmen Push Natural Gas For Energy Security

let's start a company that does nothing but still makes a profit image

photo: Kat/Creative Commons

Just when newly disclosed documents obtained by the New York Times reveal the financial shaky ground on which fracking companies base their claims, a group on Congressmen are urging President Obama to further embrace natural gas as the key to US energy security.Huffington Post reports that eight members of Congress, among whom are members of the House Armed Services Committee, the Select Intelligence Committee, the Judiciary Committee, and the Homeland Security Committee, have sent a letter to the President (full text here) urging him to expand hydraulic fracturing so that the nation can access more of its domestic natural gas reserves and ultimately achieve energy independence.

It's a familiar refrain, more domestic fossil fuel production will increase national security, but interestingly this time the military connection is made overtly.

While we are doing this important work abroad it would be height of contradiction to place unwarranted restrictions on both the locations and the methods by which we attempt to recover our own 2,552 trillion cubic feet of natural gas in the United States. We owe it to our citizens, and most importantly, our military to be free of the constraints of having to fight abroad over resources that can be safely recovered here at home.

Now, about that financially shaky ground of fracking (we'll ignore for the moment the environmental risks of fracking) and origin of that "Enron moment".

Democracy Now sums up the more salacious parts of those New York Times documents:

An August 2009 memo from the firm IHS Drilling Data says, "The word in the world of independents is that the shale plays are just giant Ponzi schemes and the economics just do not work." Earlier this year, an analyst at PNC Wealth Management compared natural gas projects to the dot-com boom, saying, "money is pouring in" even though drilling is "inherently unprofitable." In another memo, a retired geologist for a major oil giant writes, "These corporate giants are having an Enron moment... They want to bend light to hide the truth."

In total, the reporting revealed that just 10% of more than the 9,000 wells examined are recouping costs after seven years in operations, with just 20% of wells expected to ever be profitable (and those in Texas, Louisiana and Arkansas).

There are a couple things that are owed to the citizens of the United States here, to use the phrasing in the Obama letter.

Ending US imperialist adventures in search of natural resources which are in no small part bankrupting the nation ($20 billion for air conditioning in Afghanistan and Iraq?!? more than the NASA budget, and that's chump change compared to the total price tag...) is certainly one of them.

Achieving a greater degree of energy independence and energy security is also one of them.

But both financially and environmentally restricting where and how fracking is done in the US is far from unwarranted, given what we already know about the possibility of fracking contaminating drinking water and what we are increasingly learning about the financial prospects of it. Fracking is far more about wringing out more profits from the planet, health and safety be damned, than it is about, well, any other factor at play.

If we are collectively willing to invest so heavily financially and chronologically in extracting more and more natural gas, developing the necessary infrastructure to power our motor vehicle fleet so that we can displace and replace our oil addiction, certainly we can muster the financial and political will to instead develop our prodigious domestic renewable energy resources and instead electrifying our motor vehicle fleet. Keeping in mind that natural gas probably has a place in that; and that even with a massive expansion of renewables there will be a transition period during which natural gas plays a greater role than it currently does.)

In the mid to long term, the energy security needs of the United States would be far better served by tapping to the greatest possible degree and as quickly as possible, renewable energy sources than more of the same in terms of fossil fuels. Indeed, as long as any non-renewable sources of energy are so dominantly used, energy independence is simply an impossibility.

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