From Bakken to Bakersfield ... Get Ready for The Big Fight Between Greenies and Green Dollars

The United States is blessed with an abundance of human and natural resources, combined with a self governing freedom based society.

So if that's the case, and it is, why then do we have such high unemployment and debt? Why are we in such financial trouble as individuals, cities, states and the nation as a whole?

And why aren't we energy independent?

Well, as Pogo said so well, "We have met the enemy and he is us."

The energy fight between greenies and jobs is heating up in California.

And hanging in the balance are the state of California's financial stability and its citizens prosperity. The technology based solution to both problems is sitting in plain sight.

In fact, the Monterey Shale has more oil than North Dakota but the environmentalists will fight to keep it from being developed anytime soon, if ever. The European mindset is alive and well in the Golden State. As a result, the financial situations and job conditions are similar as well.

Vast Oil Reserve May Now Be Within Reach, and Battle Heats Up has the story:

At the Midway-Sunset oil field in California, the prize lies fairly close to the surface, so the wells do not have to be very deep. The oil in the Monterey Shale is much less accessible.

"FELLOWS, Calif. — Secure in this state’s history and mythology, the venerable Midway-Sunset oil field near here keeps producing crude more than a century after Southern California’s oil boom. Many of its bobbing pump jacks are relatively short, a telltale sign of the shallowness of the wells and the ease of extracting their prize.  

But away from this forest of pump jacks on a flat, brown landscape, a road snakes up into nearby hills that are largely untouched — save for a handful of exploratory wells pumping oil from depths many times those of Midway-Sunset’s. These wells are tapping crude directly from what is called the Monterey Shale, which could represent the future of California’s oil industry — and a potential arena for conflict between drillers and the state’s powerful environmental interests.

At one such exploratory site, tall pump jacks stood above two active wells on a small patch of federal land. For now, the operator, Venoco, has been storing the oil in two large tanks. But construction is scheduled to start soon on pipelines, and more wells are planned.

Comprising two-thirds of the United States’s total estimated shale oil reserves and covering 1,750 square miles from Southern to Central California, the Monterey Shale could turn California into the nation’s top oil-producing state and yield the kind of riches that far smaller shale oil deposits have showered on North Dakota and Texas.

For decades, oilmen have been unable to extricate the Monterey Shale’s crude because of its complex geological formation, which makes extraction quite expensive. But as the oil industry’s technological advances succeed in unlocking oil from increasingly difficult locations, there is heady talk that California could be in store for a new oil boom.

Established companies are expanding into the Monterey Shale, while newcomers are opening offices in Bakersfield, the capital of California’s oil industry, about 40 miles east of here. With oil prices remaining high, landmen are buying up leases on federal land, sometimes bidding more than a thousand dollars an acre in auctions that used to fetch the minimum of $2. . . . 

The Monterey Shale has also galvanized California’s powerful environmental groups. They are pressing the state to strictly regulate hydraulic fracturing, or fracking, the drilling technique that has fueled the shale oil and gas boom elsewhere but has drawn opposition from many environmentalists....

Severin Borenstein, a co-director of the Energy Institute at the Haas School of Business at the University of California, Berkeley, said technological advances and the high price of oil were driving interest in the Monterey Shale, just as elsewhere.

“Everyone has known that there is shale oil not just in the Monterey Shale but also in North Dakota and Wyoming and all over the country,” he said. “Back in the ‘70s, there were discussions that there’s all this oil and all we’ve got to do is get it. Now 40 years later, the technologies have become available to actually get it in a cost-effective way.”

While oil is found less than 2,000 feet below the surface in fields like Midway-Sunset, companies must pump down to between 6,000 and 15,000 to tap shale oil in the Monterey.

Though production has been declining for years, California remains the country’s fourth-largest oil-producing state, after Texas, North Dakota and Alaska. So far, little of the crude is derived from the Monterey Shale, whose untapped deposits are estimated at 15.4 billion barrels, or more than four times the reserves of the Bakken Shale in North Dakota, according to the United States Energy Information Administration.

“There are billions of barrels of oil buried in the Monterey Shale, and as far as I know, nobody’s been able to find it yet,” said Neil Ormond, the president of Petroleum Land Management, a company based in Clovis, Calif. “But I think there’s going to be more people looking for it. You can’t let a few dry holes discourage the whole thing, because if you find oil, you make money.” . . . 

Companies with experience exploiting the Bakken Shale, including the New York-based Hess, have recently set up operations in Bakersfield, too. Jon Pepper, a spokesman for Hess, said it was “too early to talk in any definitive way” about the company’s plans in the Monterey Shale.

But the oil companies’ plans for the Monterey Shale are already drawing increasing scrutiny from environmental groups. Though oil companies have engaged in fracking in California for decades, the process was only loosely monitored by state regulators.

The Monterey Shale’s geological formation will require companies to engage in more intensive fracking and deeper, horizontal drilling, a dangerous prospect in a seismically active region like California, environmental groups say.

Environmental groups, including the Sierra Club and the Center for Biological Diversity, are suing the Bureau of Land Management and the Department of Conservation to prevent the opening up of further land to oil exploration and to enforce stricter environmental practices. . . . 

Tupper Hull, a spokesman for the Western States Petroleum Association, an industry lobbying group, said oil companies had safely used fracking for decades in California, mostly combined with traditional vertical drilling.

“Nobody can point to any incident or impact that has taken place,” Mr. Hull said."

Summing Up

Technology is a wonderful thing.

So is energy independence.

So is economic growth.

So is high employment.

So is financial stability and living within our means.

So are facts.

Economic growth is essential to a prosperous and stable society, and innovation and investments are the keys to private sector led growth.

California can solve its financial problems if wrongheaded ideology is offset by fact based decision making.

So can the U.S.

So let's all watch what happens in the Golden State and get a better picture of what's quite likely going on behind the scenes in Washington, too.

Thanks. Bob.