Top story on the front of the Wall Street Journal has the headline: "U.S. Redraws World Oil Map." Subhead reads: "Shale Boom Puts America on Track to Surpass Saudi Arabia in Production by 2020."
This, of course, is terrible news to those who despise fossil fuels, but good news for many other Americans. Particularly those of us who have lived as hostages to OPEC since the early 1970s.
We just elected a new governor who unabashedly campaigned on a platform of exploiting North Carolina's potential natural gas resources. This is somewhat controversial and politically incorrect because 1) everyone knows you can't frack without messing up the groundwater 2) There's not that much natural gas to be had in North Carolina and 3) It'll take a long time before we get any out, and especially if the price of gas stays low.
Those, anyway, are the main arguments the anti-fracking crowd has put forward against exploiting North Carolina's natural gas resources. Pat McCrory doesn't buy those arguments and thinks a nicely developed energy sector in North Carolina might help knock down the state's ghastly unemployment rate.
And now that there's the possibility of Republican rule over the executive and legislative branches for the next eight years, it's likely that we will put fracking to the test in this decade. And for all I know, there may be oil rigs off the NC coast by 2030.
Anyone who says it doesn't matter who is in charge on Jones Street is nuts.
When the Republicans seized control of the legislature two years ago just in time to redistrict, and when Gov. Perdue's very late decision not to seek re-election effectively sealed McCrory's victory this fall, North Carolina's government went from ambivalent to very enthusiastic on the matter of energy exploration. This may wind up being one of the major policy shifts from Democratic to Republican rule.
We will see, eventually, how much natural gas there is to be extracted through fracking. Right now, the anti-fracking crowd points to a U.S. Geological Survey estimate that there is "only" 1.7 trillion cubic feet in the Deep River basin that runs from Durham to South Carolina. Republican legislators weren't put off by that; they said let's start punching holes in the ol' Triassic rock and see how much there really is. Maybe it will turn out that there is twice as much natural gas under the Piedmont. Me, I'm interested in the Cumberland-Marlboro basin to the southeast of the Deep River basin, which hasn't been assessed yet.
There is an interesting kicker to the whole energy independence narrative. China gets around half its oil from the Persian Gulf. As the Journal article points out, the country that has been in charge of protecting the sea lanes to and from the Middle East has been the United States. So the question is whether we are going to continue to pay for the Navy's Fifth Fleet - a cost the Journal pegs at $60 billion to $80 billion a year - to make sure that China's growing oil deliveries arrive safe from the Middle East, even as our exports from that volatile region decline. After all, the Chinese need that oil to make our iPads. Or will China build an expansive and expensive blue-water Navy to protect its own tankers, and are we OK with that?
