Friday, June 20, 2008

Questioning the Motivation Behind the Call to Open Up The Arctic for Oil & Gas Exploration

It is not surprising to find one of the main headlines on BBC's page (June 18, 2008) that George Bush Jr. has asked Congress to open up drilling in the Alaska Wildlife Refuge. He describes the 27 year old policy as "out dated and counter-productive". This call by the Bush Administration upon congress might be one prompted by one of two things:

1)It is his government's response to the plea by the Americans to alleviate the prices people are paying at the pump


2)It is one of the planned agenda items that his administration meant to implement before leaving the Oval office.

Dating back to the State of the Union Addresses by George Bush in the past 2 years, he had impressed back in December 2006 that Americans are "addicted to oil".

The analysis of Ms. Kay, "Oil and the Bush Cabinet" suggested the Bush Administration would try to clear a path towards the drilling of oil in Arctic. (posted on January 29, 2001)

A poignant point in the analysis describes that the Bush administration differs from previous wealthy cabinets in that many of the officials have links to the same industry which is oil. "The president, vice-president, commerce secretary and national security adviser all have strong ties to the oil industry."

1) National Security Advisor – Condoleeza Rice was a director of Chevron

2) Vice President – Dick Cheney was CEO of Haliburton Oil Company

3) Commerce Secretary – Donald Evans owned stocks worth between $5m – $25m in Tom Brown Inc (another oil and gas exploration company.)

In that article Ms. Kay states that the administration had already made it clear that "it would be interested in opening up oil exploration in Alaska."

What the public needs to keep in perspective are the events of the past eight years since the election of the Bush Administration into office. In reviewing the State of the Union Address since 2006, Bush has impressed that Americans are "addicted to oil", and that the country needed to break that dependency through the development of alternative energy sources and providing consumers with other options such as fuel efficient hybrid cars.

Back in Oct 2006, the price of oil was at $2.26 per gallon, which had gone down from $3.04 in August. During a renewable-energy conference he addressed the audience:

"Let me just put it bluntly: We're too dependent on oil," Mr Bush told the conference in St Louis.
"Low gasoline prices may mask that concern.
"I believe so strongly that this country has got to use its talent and its wealth to get us off oil.
"Probably the fastest way we can begin to change the consumer habits is to promote hybrid vehicles."

In another analysis of US dependence on foreign oil (Dec 2006) the article lists that Bush wants to reduce oil imports from the Middle East by 75% by 2025. Crude imports are used in fueling homes, cars, and factories. It is necessary to keep the engine of the economy running.

Where does the US get its foreign oil from? The Middle Eastern countries supply the US with most of its crude oil supply, however the Persian Gulf producers only "make up less the 1/5th of all imports and just 11% of total US consumption, according to the US Energy Department" (source: BBC Article)

The neighboring countries of Mexico and Canada are biggest individual exporters of oil to the US. In 2004, Canada exported 782.5 million barrels to the US; and Mexico exported 609 million barrels (according to Energy Information Administration.)

The following year in 2007 the energy policy was among the top priorities in Bush's State of the Union address, because this priority is linked to national security. He bemoans that the US had been "too long dependent on foreign oil", and was "vulnerable to hostile regimes and terrorists." He called for a 20% reduction in petroleum use by 2017 by promoting research and funding of up to 3.6 billion. He promoted ethanol as the alternative fuel source which comes primarily from corn.

In that year's address he also stated that he wanted to double the country's Strategic Petroleum Reserve (SPR) by 2027. The intent is to double this emergency petroleum store from its current capacity of 727 million barrels of crude oil to 1,494 million barrels. I would question why this necessary if the goal is to be less dependent on petroleum oil to run the economy.

Despite these intended energy policy changes, Bush's critics have identified that the government has not made any headway on any of the goals. Although Congress passed the bill that authorized large increases into funding energy research, Bush requested less money for the research than Congress had allowed him to.

The Energy Policy Act of 2005 called for $632m (£320m) into renewable energy research, for example.

But Mr. Bush asked for only $342m ($173m) - about the same amount that the Ben Stiller film Night at the Museum earned worldwide in its first three weeks.

The president also requested less than he could have done for research into hydrogen power, energy efficiency, and other areas, Senator Bingaman said in a February 2006 statement.

(Source: BBC News January 23rd, 2007)

It is important to understand and put into perspective the culmination of words, actions, and the events of the past 8 years when considering the latest call by Bush to open up the drilling in Alaska. Although the proposed size of the land is small ("the size of a postage stamp in the city of San Francisco", as described by a co-worker when I opened up the topic yesterday), there are other larger implications, and it isn't simply to save habitat of the endangered species of the Polar Bear.

It is a good balance to get a Middle Eastern point of view on the US' quest to reduce dependency on the Middle East for oil. In March 2003, the Saudi Arabian Petroleum Minister, Sheikh Zaki Yamani told in a revealing BBC interview about the dynamics of oil production and its effect on the US politics and economy:

Seven years or so ago, he saw a letter addressed to ex-President Clinton by a group of politicians advising him to attack Iraq, occupy the country and operate the oilfields.

Those who signed the letter are now in power - including Vice-President Richard Cheney, Secretary of Defense Donald Rumsfeld, his deputy Paul Wolfowitz and Deputy Secretary of State Richard Armitage.

Also refer to this other source from BBC NEWS that needs to be considered regarding the drilling in the Arctic

In closing, I ask the question, 'for what purpose will the opening up of the oil and gas exploration in the Alaska Wildlife Refuge serve if the current government is truly intent on changing the energy policies

"We are in this situation because of our dependence on traditional petroleum-based oil," said California Governor Arnold Schwarzenegger, a Republican.

He advocated "new technologies and new fuel choices for consumers" instead.

-Analyn Revilla

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