Debunking the latest liberal myth

Liberal myths often quickly become talking points for the Democrats, and even as conservatives punch holes in them, the Left simply patches them up and floats them again. Such is the case with the latest liberal myth/Democrat talking point – that oil companies aren’t drilling on the lands they currently hold:

“Big Oil is more interested in pumping up prices and pumping up their own profits rather than pumping more oil,” said Rep. Edward Markey (D-Mass), who has co-sponsored a bill to charge oil companies a fee for land they hold that’s not producing oil. “We should not even begin discussing handing over more public land to the oil companies until they first use [the land] they already hold.”

The oil companies are already “paying fees” for the lands they are holding, since they are leasing these lands from the government. Markey’s bill would have put additional fees on top of the amounts the oil companies had already negotiated with the government. Fortunately, two such bills went down to defeat in the House in recent days.

Like Barack Obama’s ill-conceived plan to impose “windfall” profits taxes on Big Oil, the Democrats are more interested in punishing the oil companies than letting the current oil boomlet grow into a rising tide which will, as the real JFK said, lift all boats.

To get the truth on the matter of the oil companies and what they are doing with their leased lands, we can’t depend on the liberal national media which routinely distorts the facts in favor of their masters in the Democrat Party. Instead, we have to dig deeper. “Energy Myths” is an excellent Investor’s Business Daily editorial which shoots down the most repeated liberal lies about domestic drilling. The editors report:

Oil companies have spent billions of dollars for those leases. Drilling has increased by more than 66% since 2000. They are searching for oil even as you read this. Some parts of those 68 million acres will have oil, some won’t. But at $145 a barrel, you can bet oil companies have plenty of incentive to find it.

That said, 68 million acres is in fact a minuscule amount. Some 94% of federal lands — 658 million acres — remains off-limits to exploration. Another 97% — or 1.7 billion acres — of federal offshore properties likewise remains off-limits. These lands contain tens of billions of barrels of recoverable oil. It’s there for the taking, now.

How much energy is there? Federal lands, according to the American Petroleum Institute, hold 651 trillion cubic feet of natural gas, enough to fuel 60 million households for 160 years. They hold at least 116 billion barrels of oil, maybe more. That’s enough to fuel 65 million cars and provide fuel oil for 3.2 million homes for 60 years.

As such, it’s the height of irresponsibility for Congress to leave these lands off the table. It ensures we remain vulnerable to pariah petrostates like Venezuela, Saudi Arabia, Libya, Iran and others who wish us ill.

In that same editorial, the IBD editors also deflate the “We can’t drill our way out of our energy crisis” and “Even if drilling works, it’ll take a decade or more for the oil to flow” myths, as well as the one which claims that Big Oil profits are the reason for high prices at the pumps. Highly recommended reading!

IBD isn’t just blowing smoke. The industry publication Oil & Gas Journal has the numbers:

HOUSTON — US drilling activity continued climbing to 1,913 rotary rigs working this week, up by 7 from the previous week, vs. 1,775 units drilling in the same period a year ago, Baker Hughes Inc. reported.

That’s the highest rig count since the week ended Jan. 3, 1986, when 1,915 rotary rigs were drilling in the US.

A local TV station reported last February on a local boom in West Texas driven by ramped-up oil production:

The effect of all this in the Permian Basin has been a shot in the arm to the economies of Midland and Odessa. Midland currently boasts the lowest unemployment rate in Texas. Jobs are actually waiting for workers.


There’s also the trickle down effect. New apartments are going up for the first time in 20 years. Office space is at a premium, and there’s a boom in new housing construction. Perry said last year Midland issued 550 new housing permits. That’s more than Midland has seen since 1980. This year 600 permits have already been issued.


Geologists have long known there’s a great deal of oil still locked in some very hard rock all through the Permian Basin, but you have to drill through that hard rock to get to the oil trapped more than two miles beneath the surface. The high price of oil makes that drilling very profitable once again.

But it wasn’t just early this year when the oil business became busy again. Oil and natural gas production has, in fact, been on the rise for several years now, ever since the price of crude went over $40 dollars a barrel. As with most trends in flyover country, just because the leftist media has been relatively quiet about them doesn’t mean they haven’t been occurring. The April 11, 2005, edition of the Christian Science Monitor reported this story:

PINEDALE, WYO. – Landscape painter Alfred Jacob Miller set up his easel on the shore of Fremont Lake 168 years ago and rendered one of the most famous romantic portraits ever made of the wild American West. Today, in the small ranching and tourist community that grew up around the venerated lake, motel rooms in Pinedale are sold out, but not from traditional tourists exploring the haunting Wind River range.

The influx stems from an unprecedented invasion of oil-patch “roughnecks” creating a round-the-clock beehive of drilling rig crews, pipe layers, roadbuilders, and truck fleets.

Indeed, tiny Pinedale represents ground zero in one of the biggest natural-gas booms in the postwar era. Driven by high energy prices and looser government regulations, it is transforming many of the small towns here along the rumpled spine of the Rockies – creating thousands of lucrative jobs, pouring money into local treasuries, and, as always happens with sudden growth, producing new problems ranging from traffic to drug use.

“The US national energy policy is being played out on an epic scale in our backyard,” says Ward Wise, the city manager whose folksy municipal attire is a pair of jeans, denim jacket, hiking boots, and a leather cowboy hat. “All of a sudden, our little rural town has come face to face with the hurricane force of the global energy market.”

In many ways, the continuous drilling of new wells outside Pinedale is just one example of an energy boom being played out across the American West. Oil and gas prices at record highs (until adjusted for inflation) and the opening of more public lands to development have brought small wildcatters out of retirement and attracted the usual assortment of Big Oil interests.

In just the past year alone, the Bureau of Land Management (BLM) has approved 5,700 new drilling permits in Wyoming, New Mexico, Utah, Colorado, and Montana – an increase of about 62 percent over the previous year.

But perhaps nowhere is the bonanza more evident, and the financial and social impacts more deeply felt, than here in Pinedale (population 1,400) the Sublette Countyseat. It currently has the second-lowest unemployment rate in the country and is a major reason why Wyoming is enjoying a massive budget surplus…

Let’s review: An increased oil supply, reduced pressure on pump prices, more jobs, lower unemployment, increased demand for housing (a sector of the economy which could use some more of that kind of good news), increased activity at the grocery, hardware and clothing stores, budget surpluses in the coffers of local government – these are all things that the Democrats are denying the American people with their donkeyish refusal to let us drill on any lands beyond those which have already been leased. How long can they continue to deny the will of the American people?

If they wait until early November, Democrats just might find themselved buried under a landslide of their own liberal myths.

UPDATE: It should be noted that when an oil company leases federal land, it is not necessarily granted the right to drill or produce on that land. Glen Beck provides a case in point:

Destin Dome is a formation in the Gulf of Mexico. It’s about 25 miles off of Pensacola, Florida. Experts say it has enough natural gas to supply a million homes for 30 years, this one place. Well, under Reagan, 1981, Chevron leased this dome. It’s federal land. They have the lease for the dome, 1981. They drilled three wells to explore, one in 1987, one in ’89 and one in ’95. They found an estimated 2.6 trillion cubic feet of natural gas. So story ends. We’re pumping the gas, right? No, no. The lease only gave Chevron the right to drill, not to produce the gas. They could drill. They just can’t take it out. The lease that they had on the Destin Dome, they could find it but they had to go back and get federal approval to actually take it out.

In 1996 Chevron submitted a developed plan to the state and interior department. They proposed drilling 21 different wells. They said as few as 12 but maybe as much as 21. Florida officials took their time dragging their feet deciding whether or not to grant Florida’s — grant Chevron’s request. Eventually two years went by and they were denied. Chevron appealed the decision to the department of congress. Congress sat on the appeal. Eventually in 2000 — remember this started in 1981 — in 2000 the commerce department, doing nothing on the appeal, Chevron said, okay, what are you guys doing to us. They sued the federal government in order to compel it to act. While the lawsuit was pending, Bush met with his brother Jeb, who was the Florida governor if you remember right. They agreed to have the federal government buy back the leases for $115 million and place a moratorium on the drilling in this dome until 2011.

Now, why did that happen? There are over 140 actual leased tracks right now that these oil companies have that they cannot drill in. They have the leases. They can drill in some of them but they can’t produce. In others they can look but they can’t drill. So when people come out and say, these oil companies already have these giant tracts of land, ask yourself and ask them, do they have the right to drill and produce on those lands.

By the way, what did Chevron do? It took the refund from the government, it took the $115 million. Instead of the 2.6 trillion cubic feet of natural gas, enough, for 30 years of natural gas, they took the $115 million refund and they invested it in a project in Angola where they’re currently producing liquefied natural gas that has to be shipped from Angola to us.

Hat tip: RightNation.US‘s Mollywalk.

– JP