Boy, holes just keep on popping up in the plans of the drill baby drill crowd aye? There was a very good article by politifact criticizing Gingrich’s claim that the crude oil reserves in the United States are comparable to that of Saudi Arabia’s. Gingrich claimed that the United States may very well hold more than 3 times the reserves of that of Saudi Arabia. Politifact however found many inconsistencies in that claim:
The comparison isn’t apples to apples
The U.S. side of the comparison is based on “potentially recoverable reserves,” whereas the Saudi side of the comparison is based on “proven reserves.” Those are two very different measures.
“Proven reserves,” according to CRS, refers to estimates made with “reasonable certainty” to be “commercially recoverable” under current economic and governmental conditions. According to data from the Energy Information Adminstration, a federal agency, Saudi Arabia has 13 times the amount of proven reserves as the U.S. does. These numbers need to be taken with a grain of salt, due to imperfect estimation techniques and old or unreliable data. (Countries, for instance, have an incentive to exaggerate their holdings.) Still, at least this comparison is as close as one gets to apples to apples in the petroleum estimation business.
I advise readers to check out the entire article, they do a thorough analysis of Gingrich’s claims and go piece by piece as to why it is mostly false. Strictly speaking, if we are talking about crude reserves, no, we definately do not hold even close to comparable amount of reserves to that of Saudi Arabia. Context is an important word here, and if we are talking oil in general, not the common crude we convert to patroleum, then there may be a possibility. Then again alot of things are possible, again, check out the entire article. I believe Politifact does an excellent job disecting Gingrich’s claim.
There was another interesting tidbit I found regarding the keystone pipeline, you all remember that right? The pipeline that would have helped solve our energy needs and provide some 20,000 jobs (supposedly)? Well Rep. Ed Markey (D-MA) had attempted to add in an amendment to the keystone proposal earlier this month that would have restricted Transcanada from exporting that oil through the pipeline beyond American soil. Instead it would have required them to sell the crude to the American domestic market only, Republicans of course all voted against it:
Ed Markey (D-Mass.), to ensure that if the Keystone pipeline is built, the oil transported to the Gulf of Mexico must remain in the United States. Failed 173-254.
The reasons for republican opposition were predictable to say the least, the American petroleum institute insisted such an amendment would have been comparable to a communist regime:
The American Petroleum Institute is setting the record straight on Congressman Ed Markey’s claim that oil from the Keystone XL pipeline will be exported. The project pipeline will help keep U.S. refineries supplied with domestic energy and Canadian oil supplies. Bringing additional crude oil to U.S. refineries is good for our energy security, economic security and certainly provides Americans across the country with supply flexibility.
“Any effort to restrict market forces on commodities like oil and natural gas is a North Korean style model of economics and has no place here in America,” said API Chief Economist John Felmy.
Mr Felmy is another person comparing oranges to apples here. As far as I am aware, TransCanada is wanting to sign an agreement with the Federal government to use public land, land owned mostly by the American tax payers. We’re not talking purely about private businesses here, we’re talking about a private corporation wanting to exploit public land and wanting to sign an ageement with a government body. The freedoms of the private market need not apply in this case because we’re not talking purely about private business, so no, it’s not ‘North Korean styled’ economics. If Transcanada disagrees with the standards set by the Federal government and tax payers, they can move along negotiations with private businesses and private property owners individually. Let’s take this into another example, if an american oil corporation was to build a pipeline through Australia, would the rights and ability of that corporation be protected by American economic law? No, because we’re talking about another country, and foreign public land. Surely Mr Felmy is well aware of this, but likewise, he has his own interests and those of his corporate buddies in mind, they’ll twist the facts to push their agenda.
What gets to me most from that statement from the American Petroleum association is this claim that the keystone pipeline would provide energy security, and that this amendment somehow endangered that, how I ask? Do they take all of us for complete idiots? There is absolutely no guarantee or evidence offered by Transcanada to suggest that the keystone pipeline will be catering mostly to American consumers, and why would it? The pipeline goes right down to the Mexican gulf, what logic is there to suggest this will be used for the most part to American consumption? At the end of the day Transcanada is a private business, they have absolutely no obligation to American public interests and concerns. To insist that complete trust should be put in a private business such as TransCanada, over such an expanse of public land and environment, with no obligations made to American public interests, is preposterous. Sadly a sizable portion of the American population, lead by the Republicans (and their corporate interests) are willing to go with such an agreement. Fortunately the proposal didn’t get through congress.