Carpe Diem

Energy updates: Carbon dioxide at a 20-year low, oceans of natural gas, Romney vs. Obama on energy, $1T oil/gas capex in 2012

1. Investor’s Business Daily ran an excellent editorial a few days ago on the “shockingly good news” that carbon emissions are now the lowest in 20 years, going all the way back to 1992 (see chart above, EIA data here), here’s a slice:

“Carbon emissions in the U.S. have hit a 20-year low due to a supposedly environmentally unfriendly drilling technique that has created an abundance of cheap natural gas. The free market, it seems, does it better than the EPA.”

“Environmentalists find themselves between shale rock and a hard place after a little noticed technical report documented how the natural gas boom caused by the use of hydraulic fracturing, or fracking, has actually helped the environment in a major way while also creating jobs and economic growth.”

“In the report, the U.S. Energy Information Agency, a part of the Energy Department, said that energy-related U.S. CO2 emissions for the first four months of this year fell to about 1992 levels. EIA estimates that full-year emissions will be the lowest since at least 1995. The untold story is that this has been achieved by the free market and private-sector technology, not government mandates.”

“How ironic that those greedy energy companies and not government-backed green energy failures such as Solyndra and the Chevy Volt are both saving the earth and paving the way to genuine energy independence. Fracking will save the earth before anything like cap-and-trade or the Kyoto Protocol — an inconvenient truth indeed for environmentalists.”

2. Robert Lenzner at Forbes summarizes the Top Ten Reasons to Love Natural Gas, here’s the opening paragraph:

“Here is the most promising development in the American economy. Period! The discovery of oceans of natural gas in North America means a vastly cheaper source of energy, the creation of hundreds of thousands of new jobs, a meaningful reduction in global warming, a much diminished balance of payments deficit, a far stronger dollar, a jump in the profits of the electric utilities, who will then raise their cash dividend payouts, which will benefit widows and orphans as well as giant pension funds, and cause the gold bugs lasting anguish.”

3.  My AEI colleagues Ken Green and Elizabeth DeMeo help us understand how the energy platforms of Obama and Romney are different, here’s the bottom line:

“In reviewing the energy policy platforms of Romney and Obama, we see that Obama shows a distinct preference for a command-driven energy economy, while Romney strongly favors a freer, private-sector energy economy. Obama places far less emphasis on energy affordability and far more emphasis on greening the energy supply even though that raises costs. Finally, whereas Romney clearly has a goal of energy interdependence with Canada, Obama’s view of energy independence is more a “go it alone” approach, where pipelines to Canada need not apply.”

4. Global oil and gas capital expenditures will break the $1 trillion barrier, according to a new report from natural resources experts Global Data, here’s an excerpt:

“Increased activity in the Exploration and Production (E&P) sector will push oil and gas capital expenditure (capex) to an enormous $1,039 billion for 2012. We estimate that total oil and gas capex will increase 13.4% this year over the 2011 total of $916 billion, as oil companies intensify upstream operations across locations as diverse as offshore Brazil, the Gulf of Mexico and the Arctic Circle.”

“Investor confidence in new upstream projects is being driven by the increasing number of oil and gas discoveries (242 last year alone), combined with consistently high oil prices and the arrival of new technologies that are giving the major firms access to deep offshore reserves that were previously technically and financially unviable.”

“North America is expected to witness the highest capex, with $254 billion, or 24.5% of the 2012 global total. Compared to a global average capex growth rate of 13.4%, North America is expected to see growth of 15.7%. The increase of unconventional oil and gas activities, especially the continuing exploitation of shale oil and gas sites and the development of Canadian oil sands, are the major drivers for these investments.”

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