Seeing Chukchi

By INVESTOR'S BUSINESS DAILY | Posted Friday, May 29, 2009 4:20 PM PT

Energy: As administration officials tilt at windmills and talk of painting our roofs white, a real energy solution has emerged from the Arctic deep. So why has only Alaska's Sarah Palin noticed?

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Back in July, when IBD first interviewed the then-little-known governor, Palin emphasized developing Alaska's Chukchi Sea resources. Under those icy waters, it was then believed, was enough oil and gas to supply America for a decade.

"It's a very nonsensical position we're in right now," Palin told us. "(We) ask the Saudis to ramp up production of crude oil so that hungry markets in America can be fed, (and) your sister state in Alaska has those resources."

At the time, it was thought that Chukchi's waters northwest of Alaska's landmass held 30 billion cubic feet of natural gas.

Today, Science magazine reports that the U.S. Geological Survey now finds it holds more than anyone thought — 1.6 trillion cubic feet of undiscovered gas, or 30% of the world's supply and 83 billion barrels of undiscovered oil, 4% of the global conventional resources.

That's enough U.S. energy to achieve self-sufficiency and never worry about it as a national security question again.

The only thing left to do is drill. "Congress can do that for us right now," Palin told IBD, urging Washington to open the territory.

That Congress hasn't is the biggest part of the problem.

"Alaska should be the head, not the tail, to the energy solution," Palin said.

It ought to be reassuring to Americans that energy can be developed here. Americans are environmentally conscious, and Palin herself has a good record on balancing development with ecology.

The alternative isn't reassuring: If we don't drill, the Russians will. Situated over on the eastern end of the Chukchi Sea, they have global ambitions of dominating the energy trade and no qualms about muscling in on the U.S.

Already, undersea volcanic activity has melted much of the Arctic ice cap and enabled more exploration than in the past. The U.S. has as much claim to the region as the Russians, but only the Russians seem to be taking advantage of the geological bounty.

It's pure energy, not theoretics. That's significant because Steven Chu's Energy Department is spending too many resources trying to figure out how to turn all the weird wind power and switchgrass schemes into viable energy resources.

His latest idea is to paint roofs white. None of this puts significant energy out to consumers. Nor does it come close to matching oil in energy value.

A recent study by Exxon Mobil calculated that even as efforts to develop alternative fuels move forward, oil will remain the dominant energy source through at least 2030.

Domestic oil and gas development is an off-the-shelf (dare we say "shovel ready"?) solution that can serve a bridge to all the green experiments if any someday pan out.

Drilling Alaska energy beats kowtowing to the Saudis or waiting for odd energy sources like wind power to become economical.

Since neither of those are solutions for America's energy security, the best way to handle this is the third way, the Palin way: drilling.

Now that the resources are there, it's time to do it.

Big Oil Bites Back

By INVESTOR'S BUSINESS DAILY | Posted Thursday, May 28, 2009 4:20 PM PT

Companies: After an all-out war on oil companies from the left in recent years, it bodes well for the future to see Big Oil now recognizing the attack it's under and its duty to fight back. Witness Chevron and Exxon Mobil.

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Shareholder meetings can be pro forma affairs, but not for major oil companies, which have become a lightning rod for the anti-corporate sentiment gaining traction in U.S. political life since around 2006.

Wednesday, Chevron was descended upon by a zoo-full of San Francisco leftists pushing rain forest sentimentalism, Burma, and other pet causes dear to the no-soap crowd. They journeyed all the way to San Ramon, Calif. to shout "Shame on you!" and "No blood for oil" and worse yet to make demands on the company.

Among them, a vociferous crew calling on Chevron to settle quickly with an Ecuadorean activist group with a guerrilla-like name: El Frente de Defensa de la Amazonia.

El Frente has a $27 billion pollution lawsuit against Chevron. Its case is worthless. Chevron hasn't operated in Ecuador since 1992 and got a clean bill of health from Ecuador in 1998. Any pollution now is a product of Ecuador's mismanaged state oil company.

But that hasn't stopped the formidable publicity machine that's roped in the gullible media covering this case. The new demand, echoed in the press, is for Chevron to "settle" with El Frente.

Meanwhile, over at Exxon Mobil, the issue is why the company can't go "green." Another throng of activists tried to coax the company into scrapping its global leadership in oil production and instead to turn itself into genteel green farmers, tending corn and sugar and switchgrass in the name of biofuels.

But in both cases, something happened this time at the corporate meetings: The companies sharply rebuked these nonbusiness interests. It was a dramatic shift from the polite courtesies and kowtowings they've extended to these radicals in the past.

This time, they actually stood up for themselves and what they do.

Chevron's CEO bluntly told the radicals from "True Cost Of Chevron" that their waved-around propaganda "report" on the oil giant is so shoddy and false it actually "deserves the trash can."

Exxon Mobil's Chairman and CEO informed other radicals that oil and gas will continue to be dominant fuels, meeting some two-thirds of global energy needs until at least 2030. As such, it makes no sense whatever for Exxon to go into some other industry.

Better still, the shareholders of these companies smacked down every resolution designed to make the crazies feel good and the value of the companies go down. Maybe that's because these moves look like shakedowns in search of a payday.

Chevron's being sued by a registered nongovernment organization (NGO) in Ecuador, so its financing is a black box. Its lawsuit is reportedly paid for by trial lawyers in Philadelphia, a group not exactly known for respecting shareholder value. But who knows?

Exxon is beset by several groups that at least one shareholder thinks are tied to unions and activists:

"Resolutions to do things like . . . pursue renewables are really just attempts by environmentalists and unions to gain control of the company to advance various public-policy goals," Steven Milloy, managing partner at Action Fund Management, told Bloomberg News. "At the top of that list is climate change." Milloy should know: He's also publisher of the popular JunkScience.com Web site.

The real aim of all these attacks is to end these companies' world leadership in oil extraction. The green groups want to put an end to what the oil companies do best, from finding oil in the world's most hostile climates like the Arctic Sea, to extracting oil from abandoned wells, to drilling oil 12 miles through salt walls under the sea.

The ultimate goal is less oil to power American industry and to maintain the quality of private life.

It looks like a new era is upon us. The push-back to defend our way of life has begun.

Is China As Suicidal As We Are?

By INVESTOR'S BUSINESS DAILY | Posted Wednesday, May 27, 2009 4:20 PM PT

Energy Policy: House Speaker Nancy Pelosi goes to China seeking help in fighting climate change. It's doubtful the world's No. 1 polluter will agree to follow us over the economic cliff.

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In the summer of 2007, a report by the Netherlands Environmental Assessment Agency announced that China had officially become the world's biggest polluter after its CO2 emissions rose an astounding 9% the year before. Since then, China has shown no signs of slowing down in its commitment to both economic and energy growth.

Between 1980 and 2006, China increased its carbon emissions by 321%. China is adding 100 gigawatts of coal-fired electricity capacity annually. That's like adding the entire capacity of the United States every three years. The irony is that this powers Chinese factories that export goods to the energy-starving and economically beleaguered U.S.

This isn't all China exports. As Peter Brookes of the Heritage Foundation reports, , sulfur from China alone reaches 10% to 15% of the EPA's allowable levels in California, Oregon and Washington. Estimates are that a third of California's air pollution and a fifth of Oregon's come from China. Sensors in the Sierra Nevada Mountains have identified huge Chinese pollution clouds that traverse the Pacific.

Apparently tired of breathing exported Chinese pollution in her San Francisco district, Speaker Pelosi found herself on Tuesday attending the U.S.-China Clean Energy Forum.

She brought along other members of Congress, including Ed Markey, D-Mass., co-author of an economy-killing cap-and-tax bill that just passed a key House committee.

This is the latest effort trying to persuade the Chinese to adopt the U.S. policy of restricting economic growth by accepting draconian caps on carbon emissions with no scientific evidence that it will measurably affect global temperatures. So far the Chinese aren't buying it.

As Fareed Zakaria notes in his book "The Post-American World": "The combined carbon dioxide emissions from the 850 new coal-fired plants that China and India are building between now and 2012 are five times the total savings of the Kyoto accords."

So why are we sacrificing our economic growth to fight their pollution?

China is exempt from Kyoto as a "developing" nation, which is one of the reasons the U.S. Senate once voted 97-0 not to consider it for ratification. China doesn't mind seeing the U.S. economy handcuffed as it races to make this century a Chinese century. As it is, our states and taxpayers struggle to clean up imported Chinese pollution.

In fairness, China is pursuing other, cleaner forms of energy. It has 11 nuclear power plants on line. Another 22 are under construction. Fu Manchang, the secretary-general of the Chinese Nuclear Society, says: "We have the ability to raise our nuclear power capacity to at least 60 or 70 gigawatts."

China's all-of-the-above energy approach to exploiting all its resources is part of its commitment to both economic and energy growth and stands in stark contrast to our none-of-the-above approach to proven energy sources. We are committed to pricing coal and other fossil fuels out of existence with no feasible substitute.

We are reminded of Vice President Joe Biden's comment in a rope line during the campaign:

"We're not supporting 'clean coal.' Guess what. China's building two every week. Two dirty coal plants. And it's polluting the United States. It's causing people to die." He went on to say, "No coal plants in America. Build them, if they're going to build them, over there. Make them clean."

They are building them over there and not here. That's not an energy policy. That's economic suicide. Clean energy and economic growth are not incompatible.

We should be trying to get China to reduce its pollution. But we should also be expanding our own domestic energy resources, including building at least as many nuclear power plants as China is.

China is unwilling to commit economic suicide. Why are we?