California Needs a Crude Awakening

[Valin]

City Journal:

 

Black gold could revive the Golden State—if politicians got out of the way.

Tom Gray

Summer 2012

 

After the Deepwater Horizon oil rig exploded in the Gulf of Mexico in April 2010, the Obama administration slapped a moratorium on deepwater drilling in the Gulf and backed away from plans to expand drilling along the eastern United States. Louisiana’s governor, Bobby Jindal, saw thousands of jobs at stake and demanded that the moratorium be lifted. But the governor of California, Arnold Schwarzenegger, responded differently: he withdrew his support for Tranquillon Ridge, an offshore drilling project that would have delivered up to $100 million in yearly revenue to the financially struggling state government.

 

Schwarzenegger’s reaction was a prime example of California’s animus toward oil drilling. Tranquillon Ridge wouldn’t have required a new drilling platform; it would have used an existing one. That platform stands in a safe 242 feet of water—Deepwater Horizon was drilling in about 5,000 feet—and is far from any coastal towns. Environmental activists had even cut a deal with the driller to retire the platform after 14 years. It was a deal with low risks and no losers. But news coverage from the Gulf blinded Schwarzenegger. “I see on TV the birds drenched in oil, the fishermen out of work, the massive oil spill, and the oil slick destroying our precious ecosystem,” he declared at a May 2010 news conference. “That will not happen here in California.”

 

(Snip)

 

The potential impact of 15.4 billion barrels of oil is enormous. Even if California managed to tap just half of that quantity over the next 35 years, the state would be adding an average of 220 million barrels a year—doubling its current output and matching its peak year of 1985. It would also be pumping $22 billion each year into its economy if crude prices stayed near their current levels (in light of global demand, it’s more likely that prices will rise). If the EIA estimate is reasonably close to the mark, the Monterey Formation would be in a class with oil fields in Saudi Arabia. “Having a field like this on American soil would be a game changer for American dependence on foreign imports,” says Chris Faulkner, CEO of the Dallas-based exploration company Breitling Oil and Gas.

 

(Snip)

[RedlegDuke]

California really believes that they can just continue the way they are going until Uncle Sugar bails them out.

 

They must be made to live with the consequences of their decisions.

[Valin]

California really believes that they can just continue the way they are going until Uncle Sugar bails them out.

 

They must be made to live with the consequences of their decisions.

 

I believe you are right. The same can be said for other states as well, Ill. comes to mind.