Author: GTD Group (Page 6 of 23)

Since the 1970s, America’s main energy security threat has been OPEC, (Organization of Petroleum Exporting Countries). P. R. China is well under way to position itself as the next major global energy market threat.

Though the US is producing abundantly more oil and natural gas domestically and was a net exporter of petroleum products in 2011, China has taken a keen interest in the development and investment in US energy assets.

Energy companies within Oklahoma and throughout the US have partnered with China companies. Is that good or bad? Yes.

The influx of foreign investment in our natural resources is a mixed blessing. On the one hand, it has provided cash infusion for some of our US energy companies. On the other hand, foreign ownership in US company assets could present an energy security threat in the future.

China has been spending billions of dollars to acquire interests in US energy companies. It is dramatically increasing its investment in the US.

China’s energy card is being used to position itself as a major investor in all continents throughout the world.

China is focusing in on natural gas development. The manufacturing of LNG tankers is becoming a focus of China.

Demand for oil continues at a rapid pace. China’s electricity consumption is projected to nearly triple over the next decade, growing to an average of over 4 percent per year.

I have seen first-hand from my first business trip to P.R. China in 1994 to my last business trip in 2006 how tremendous economic development has occurred and is continuing to occur. The demand for energy that P. R. China will need in the years ahead is staggering.

China has closed in on the US when it comes to buying oil from the Middle East. So both countries, the US and China, are showing strong interest in the Middle East region with their military presence.

The US, for many years, has served as the energy security “police” of the Middle East region, making sure that all ports remained open for business. There is now the potential for additional tension build-up in the region.

The front cover of The Journal of International Security Affairs, Fall/Winter 2013 sums it up best, “China’s Rise…And Why We Should Worry”.

On top of all this, recently, Russia and P. R. China are teaming up. Russia agreed to supply China with more oil and will develop an oil refinery together.

The good news is that America is becoming less and less dependent on foreign oil especially from the Middle East region.

It is extremely important that the US be in a strong position of securing energy reserves within its own boundaries. Therefore, we need a plan. The US needs energy security. America Needs America’s Energy!

Together we can create the People’s Energy Plan! Go to www.peoplesenergyplan.com to join the effort. Facebook: America Needs America’s Energy with over 9000 supporters plus and growing. — America Needs America’s Energy: Creating Together the People’s Energy Plan!

Last week’s column and in this week’s column, I address questions that I have been asked regarding energy issues and views.

-How has the energy picture changed in the past five years, from a global perspective?

In 2008, the BRIC countries (Brazil, Russia, India and China) were the focus, with economic experts predicting they would become the growing powers for the twenty-first century.  As the world’s consumption continued to increase, analysts thought it might be difficult for current levels of production to satisfy demand.  Today, China is already taking 38 percent more oil from the Middle East than the United States, and its electricity consumption is projected to nearly triple over the next decade.  But the world remains heavily dependent on oil from Saudi Arabia, Russia, and Iran—all of which are politically unstable.  The United States needs an abundance of oil which makes a strong case for why “America Needs America’s Energy”.

-What are the major variables that impact the energy industry in America?

The major moving parts that impact us in the energy industry can include increasing demand, terrorism, and inadequate government policy.  The good news is that recent finds of oil and gas reserves in our country mean production is far from peaking, and demand continues on the upside for both transportation and power generation in a digital age.   Meantime, we face continual terrorist threats and suffer from government policy focused solely on alternative energy options that, while potentially attractive in the long-run, cannot meet the demand in our country in the near future.

-What are the most common misconceptions about the energy industry?

For years the public perception of the energy industry has been that of fat cats, ruthless J. R. Ewing types who make a killing off oil in their own backyard, when nothing could be further from the truth.  Today 60 percent of our domestic oil production comes from thousands of average Americans who operate wells producing ten barrels or less a day but provide these people with a living.  And now, hundreds of everyday citizens who own land and royalty rights in Pennsylvania, for example, are benefiting from oil and gas lease bonuses.

As for “windfall profits”, US oil and gas companies’ net profit margins lag far behind several industrial sectors.  Another bogus idea is that energy companies do not pay their fair share of taxes when, in reality they do.  This is another reason why “America Needs America’s Energy” because relying on our own sources not only adds to our tax coffers, but creates jobs that

stimulate the economy.

America Needs America’s Energy!

Together we can create the People’s Energy Plan!  Go to www.peoplesenergyplan.com to join the effort.  Facebook:  America Needs America’s Energy with over 8500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

This column and in next week’s column, I will address questions that I have been asked regarding energy issues and views.

-What are the environmental concerns about hydraulic fracturing, known as “fracking”, and how is the oil and gas industry addressing them?

Consumers need to know that the hydraulic fracturing process, or “fracking” as it is more commonly known, has been in use for more than sixty years.  Once the drilling of a well has been completed, the shale is cracked by tiny ruptures, allowing the application of water, sand, and a small amount of chemical additives to release natural gas, for example.  In America Needs America’s Energy, I explain that there have been minimal reports of improper disposal of wastewater and that energy companies involved in fracking realize the importance of water resources for generations ahead, so they are applying technology to clean and reuse water.  Many companies post information about the fracking fluids being used.  Please note that I go into more detail in my latest book America’s Energy:  Issues and Views, Volume 1.

-Explain why you believe that America is inevitably moving toward a hydrogen economy and how will that impact the consumer.

First, the use of hydrogen greatly reduces pollution.  When hydrogen is combined with oxygen in a fuel cell, energy in the form of electricity is produced.  This electricity can be used to power vehicles, as a heat source, or applied to other uses.  Second, hydrogen can be produced locally from numerous sources.  Hydrogen gas can be produced from methane (natural gas) for example.  Lastly, if hydrogen is produced from water, we have a sustainable production system.

-How can consumers participate in creating an energy plan for this country?

The first step we can take is to conduct a self-audit of our own personal energy use.  In America Needs America’s Energy, I provide a sample copy of a standard report that homeowners in metro Nashville receive following a voluntary in-home energy evaluation (audit).  This Energy Action Plan shows participants the project energy savings associated with each recommended measure, such as insulating your water heater or attic.

Following that, I have provided Personal Energy Evaluation Journal forms through 2016.  The idea is to create your own personal energy plan based on the evaluation and then develop it for the several years.   At the end of each year, you can check to see if you have met your goals.  If not, you can either adjust your goals for the next five years, or lies the steps needed to achieve your personal energy goals in the near future.  You may want to include others in this initial planning stage, such as your family, your company, or your organization.

America Needs America’s Energy!

Together we can create the People’s Energy Plan!  Go to www.peoplesenergyplan.com to join the effort.  Facebook:  America Needs America’s Energy with over 8500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

There is no question that tax reforms are needed.

However, two provisions that continue to be debated are the percentage depletion allowance and the intangible drilling costs deduction, (IDCs).

The oil and gas industry depends on these two provisions.  The provisions are not identified to be subsidies or loopholes.

To the oil and gas industry, these provisions are important for producers to have capital sustainability and to have a vibrant sector.   With improved cash flow, the industry can invest money into economic development and jobs that are so critical to the US.

Studies have shown that by repealing the percentage depletion and the IDCs the US would face the impact of less wells being drilled, less jobs, and less production.  There is no doubt that this impact could be dramatic at a time when the industry is moving forward aggressively.   

It has been estimated that over 190,000 jobs would be lost within one year if both provisions are repealed.

These two provisions are cost recovery measures.  This is a time when US policies should strengthen our development of this country’s great sources of oil and gas.

Economic stability is closer to being within reach when the US has a strong energy sector.    According to the latest Business Executives for National Security’s report entitled “Security in the New Energy Landscape:  Assessing the Geostrategic Impact of the Unconventional Oil and Gas Revolution”, “the US shale boom is unique, from its origins to its tremendous global implications.  The combination of accessible geology, cost-effective technology, and a robust support and investment system fostered a new industry not replicable anywhere else in the world.  The boom helps meet rising demand for hydrocarbons in the developing world by increasing global supply elasticity.  New jobs are invigorating the American economy and the US might even become an energy exporter for the first time in decades.  Moreover, the US security portfolio is adapting.”

As US Congressman James Lankford recently stated, “The tax policy for energy exploration is similar to every other American manufacturing business.  It allows companies to deduct business expenses to incentivize private capital investment and spur growth in high-paying American jobs.”

America’s energy sustainability can only be achieved with the right incentives and right provisions being in place.  America Needs America’s Energy!

Together we can create the People’s Energy Plan!  Go to www.peoplesenergyplan.com to join the effort.  Facebook:  America Needs America’s Energy with over 8500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the Peoples’ Energy Plan!

A few weeks ago, my column was entitled “Mexico and North America’s Energy”.

As I stated, “several years ago, I had the opportunity of serving on an advisory committee appointed by the Mexico Trade Commissioner who was based in the Dallas, Texas regional office.  The advisory committee’s focus was trade and tourism between Mexico and the US.  The committee was comprised of US and Mexico business representatives.

One issue that was addressed was US and Mexico energy relations.  Since 1938, Mexico has been under strict governmental guidelines with no privatization in place.”

As I stated in my book, The Braking Point, “the first sign of changing of the guard came in 1938 when Mexico President Lazaro Cardenas nationalized the nation’s oil.  Cardenas made this move to prevent further Americanization of Mexico.

This move pushed all of the American oil companies out of Mexico…This move also gave Mexico full control over the production and export of oil.”

Seventy-five years later, in August, 2013, President Enrique Pena Nieto proposed a plan to open its oil and gas sector to foreign investments through private-public partnerships.

Since the last column on this issue, Mexico’s Congress has recently passed constitutional amendments overturning the nationalization of the oil industry.  Mexico is now open for business when it comes to the energy sector.

There is no doubt in my mind that leaders in Mexico wanted to reap the same benefits that the American oil and gas industry has made over the last few years.

As I stated in August in an interview with the Wall Street Journal’s MarketWatch, “Mexico has strong potential to enhance oil and gas production by the support of US technology alone.  With US technology and expertise, Mexico and North America could potentially benefit in a very positive way.  With that said, there are a lot of details to work out.”

Although the nationalization of Mexico’s petroleum industry did not help the people of Mexico for the past seventy-five years, this move can hopefully bring economic stability to Mexico along with North America.

America Needs America’s Energy!  Together we can create the People’s Energy Plan!  Go to www.peoplesenergyplan.com to join the effort.  Facebook:  America Needs America’s Energy with over 8500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the Peoples’ Energy Plan!