Responsibly Migrating Away from Crude Oil

Why couldn’t we start a responsible migration away from crude oil now? Why couldn’t we shift our capital spending away from crude oil except for in areas where it is critical to our near term energy security and national security?   Those are rhetorical questions of course because the answer is: we can.   The technology exists today to start changing the vehicles on our roads from those that run on gasoline to those that run on electricity from a chemical reaction between H2 & atmospheric O2.  And, while the only realistic way to ramp up hydrogen production in the near term is with natural gas and coal, the shift away from crude oil gives water a chance to compete as a renewable fuel source; this is a very important milestone in the hydrogen economy. When water is given a chance to compete as a renewable fuel, it will win. Water is simply a better choice to power our grid than hydrocarbons or salts for a long-term sustainable economy that supports good jobs and reduced waste. RMP will continue to demonstrate this point as long as our organization exists.

Phasing internal combustion engines out of our economy will obviously not happen overnight. It may even take decades to phase out our current energy infrastructure for a new one, but it is the best thing for the American economy, our national security, and our children’s future. Money spent with the spirit of expanding crude oil infrastructure perverts common sense for  greed and ignoble intentions.

The Hydrogen Economy makes its big debut in just a few short years in the Tokyo Olympic Games.
The Hydrogen Economy makes its big debut in just a few short years in Tokyo.

The science of hydrogen fuel cells does not get talked about much in the US media in 2015.  The Hydrogen Economy, however, is approaching its big debut in the 2020 Olympics in Tokyo. While countries around the world subsidize the megawatt by megawatt transition to fuel cells, some legislators in America try to move policy backward by trying to stifle positive progress for the US economy with tax hikes that hurt stable job creation. Fuel cell technology is nothing new. What is different now, however, are advances in things like solar panels, wind turbines, and the gasification of dirty fuels like American coal, pet coke, and landfill waste.   Our legislators should be incentivizing infrastructure investment in the Hydrogen Economy to create sustainable jobs.  Technological advances are starting to make the possibility of turning water into hydrogen to power fuel cells the most practical application for providing 100% of the world’s energy from sun and water in the years to come.   Our legislators should want to reduce taxes, create jobs, and improve national security rather than allow lobbying groups to keep us stuck with crude oil and its hidden tax burdens.

The oil & gas industry has grown by adding 162,000 jobs between 2007 and 2012 while the US economy overall grew our workforce by about 1 million jobs.   The recent boom in oil & gas hiring can mostly be tied to advances in hydraulic fracturing and horizontal drilling. RMP understands hydraulic fracturing, horizontal drilling, and oil & gas production as well as anybody as demonstrated by the data we bring to life on our exclusive map.   Like all oil & gas booms, however, these volatile jobs will be lost quickly when the boom goes bust as is characteristic for employment in the oil industry.   As demonstrated by the numbers above, nearly 98% of the world’s crude oil reserves exist outside our borders; the recent job creation in America simply cannot be sustained. In fact, Saudi Arabia, who can produce oil at a much lower cost than oil produced from America’s hydraulically fractured formations, has recently flexed its muscles with a casual twist of a spigot to show who is king of oil production. Saudi Arabia’s actions to preserve crude oil market share, have already significantly altered 2015 capital budgets for multi-billion dollar companies domestically and around the world.

Capital budgets and jobs tied to crude reserves produced in the United States like drilling, completing, trucking, man camps, and pipelines all come with more and more volatility as decades tick by. The rhetoric broadcast on primetime TV commercials by Brooke Alexander about energy security and energy independence can be truthful in part but can also be misleading and missing key information that could affect the decisions and sentiments of viewers [and voters]. If material job cuts and capital spending cuts in the US are fundamental occurrences to an economic sector, it’s time to fix that sector with smarter legislation.

The companies that have been doing much of the hiring in recent years related to drilling, completing, trucking, housing, and excavation are now in fact laying off many of the workers that were just hired over the last five years.   It’s a clear indication that companies creating jobs in the crude oil industry may have the best intentions of helping provide jobs and tax revenues but are vulnerable to forces outside of their control. Crude oil production changes can cause even the largest companies in the world to quickly fall to their knees when countries like Saudi Arabia flex their muscles.