World Awash in Oil?

I sincerely hope that the holiday season was kind to everyone, full of joy, good health, and happiness. I know that many folks make resolutions about how they will change and what they will do differently over the coming new year. Frankly, I’ve never been a subscriber to resolutions, since I hate breaking promises,especially to myself. On the other hand, I can promise a couple of changes in store for the membership of the HGS in 2007.
First,the Society is moving offices. We are finally getting our permanent staff, Joan and Lilly, away from the construction at I-10 and the Beltway, and moving westward to 14811 Saint Mary’s Lane.This address is a stone’s throw southwest of I-10 and Dairy Ashford. Linda Sternbach and Cheryl Desforges, and Dave Agarwal with our sister society, the GSH, have done a lot of hard work to make this transition occur as smoothly as possible.
Second, a ballot resolution has been mailed to you that would amend the Society’s by-lawsto allow for online voting. Approval of this change would go a long way towards making it easier for you to participate more directly in the running of theHGS. Though it sounds rather straightforward, making online voting a reality involved considerable time and effort on the part of Bill Osten, Don Scherer and Erik Mason. We plan to make online voting available in two years, but if the stars are properly aligned, it may be implemented in time for the 2007 Board elections.
In my previous President’s letters, I have attempted to address and inform on issues affecting geoscientists in general and HGS members in particular. However, I had a nice chuckle over a recent article in US News and World Report online (1) that I think may interest many of you. The article discussed a report published by Pulitzer Prize-winning author Dr. Daniel Yergin and his Cambridge Energy Research Associates (CERA). What caught my attention, though, was not the report but the reaction.
The CERA study states that the world may not actually run out of oil any time soon or, in other words, “Peak Oil” has not yet arrived.I naively thought that many would be cheered by CERA’s pronouncement; however this was not the case. Not only was there widespread incredulity over the study’s findings, a group named the “Congressional Peak Oil Caucus” called the study an “outrage” and “a major disservice to our country…” What is the Congressional Peak Oil Caucus and why do they think the CERA report is an outrage? The Caucus is a bipartisan group of Congressmen started by Representatives Tom Udall(D-NM) and Roscoe Bartlett (R-MD). Their stated purpose is to “to educate Congress and the public about the inevitable crisis we face regarding our future oil supply...” and to “establish an energyproject with the magnitude, creativity and sense of urgency that was incorporated in the “Man on the Moon” project to addressthe inevitable challenges of “Peak Oil””
(2). Now, I do not know whether or not we face the “inevitable challenges of Peak Oil”. I do know, however, that a study like Dr. Yergin’s, which could be used to repudiate “Peak Oil”, can be perceived as undercutting those contemplating a huge transfer of wealth for a national energy project of the magnitude envisioned by the Caucus. Thus their reason behind labeling of CERA’s report as “a major disservice to our country”. Clearly the national energy project initiative will move forward.
Who is going to pay for it? The same Congressional group is stumping to repeal items in the 2005 energy bill they have labeled “industry subsidies.” This includes such audacious handouts as the change in tax treatment for G&G costs. In a parallel vein, we also hear rumblings for a new Windfall Profits Tax. Revenue initiatives that do not come out of the pockets of taxpayers (directly) are much easier to pass through a public not exactly sympathetic to oil and gas. How may all of this affect us? I believe the onus will be squarely on our industry to slow down any new tax momentum by demonstrating how they spent profits wisely attempting to find new oil and gas reserves (especially domestically). This may not only partly blunt public criticism, but also give friends of the industry ammunition to help hold-off a Windfall Profits Tax in Congress. And, if this means more opportunities for geoscientists to engage in oil and gas exploration, I would vote YES!
(1) A World Awash in Oil? By Marianne Lavelle Posted 11/15/06 USNews and World Report Onlinehttp://www.usnews.com/usnews/biztech/articles/061115/15oil.htm
(2) http://www.tomudall.house.gov/display2.cfm?id=11447&type=Issues…the world may not run out of oil any time soon…Peak Oil has not arrived