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Monday, February 15, 2010

Obama's Restrictive Drilling Policy Will Rob $2.36 TRILLION From US GDP

The Congressional Research Service (CRS) sheds light on the true picture of America's energy resources. Their assessment looks beyond the Energy Information Administration's estimates of proven reserves to include government estimates from the U.S. Geological Survey and the Minerals Management Service to find the United States total reserves. The results show the U.S. reserves of recoverable oil to be 167 billion barrels of oil, not 21 billion - nearly eight times higher than the number pedaled by Democrats. Remarkably, 167 billion is the equivalent of replacing America's current imports from OPEC countries for more than 75 years.

Despite what the President said in his State of the Union Address, the Obama administration is doing what ever they can to prevent this country from becoming energy independent by harvesting our own reserves.
Hopes that America would soon develop vast untapped energy reserves were dashed when the incoming Obama administration ordered all federal agencies and departments to halt all such pending regulations until they could be reviewed by incoming staff. Incoming Interior Secretary Ken Salazar extended the public comment period by 180 days.
Last April, Salazar said President Obama told him regarding the comment period "to make sure that we have an open and transparent government" and to make sure that DOI was "maximizing the opportunity for the public to give us guidance on what it is they want us to do" about expanding domestic energy exploration and development.
The Interior Department announced in September it had received more than 530,000 comments... It's now four months after the close of this extended comment period, so where are the results? What happened to the open and transparent process?
Transparency right? It gets worse, they knew the results showed the comments reflected people wanted the drilling by a 2 to 1 margin. The White House didn't get the results it wanted, so the Dept. of Interior called for more investigations.
Instead, on Jan. 6 Salazar announced plans, as the energy news service Greenwire put it, that "will require more detailed environmental reviews, more public input and less use of a provision to streamline leasing." In other words, we were being promised more stalling, not more drilling.
A new report says the Obama/Salazar oil-and-gas drilling bans will raise consumer energy costs and decrease cumulative U.S. GDP by $2.36 trillion over the next two decades (full report below). That’s an average annual GDP drop of roughly.5%, it will also result in $4,400 average loss in real disposal income. The report, presented to nation’s State utility regulators in Washington has identified trillions of dollars of impact resulting from President Obama's strategy of continued reliance on foriegn oil.
SAIC’s NEMS-NARUC model results determined that maintaining traditional energy exploration and production moratoria on Federal lands would result in an alternative domestic energy future that, “…increases the cost and restricts the availability of domestic oil products and natural gas…” in all economic sectors and regions of the country.  According to the study, under the “Combined Comparative Case”, which combines the estimated increase in the oil and gas resource base with maintaining moratoria from 2009-2030, model projections show that :
  • Cumulative domestic oil and natural gas production decreases by 15% and 9%, respectively.
  • Average natural gas price increases by 17% and average electricity prices increase by 5%.
  • Cumulative national real disposable income decreases by $1.163 Trillion ($4,500 per capita).
  •  GDP decreases cumulatively by $2.36 Trillion ($1.16 Trillion NPV), an average annual decrease of 0.52%
  • Cumulative oil imports from OPEC countries increase by 4.1 Billion barrels.
  • Cumulative national payments to OPEC countries increase by $607 Billion ($295 Billion NPV).
  • If resources within the moratoria areas are not developed, there would be no new environmental effects within the U.S. jurisdiction attributable to development of those resources.  However, as a non-modeled item, the study observes that there could be environmental effects on domestic and international waters as a result of increased tanker transport of oil and gas imports and unknown environmental effects in countries from which the U.S. would import the resources.
An executive summary of the report is embedded below:

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