Could Energy Independence be around the corner?

Energy independence for the United States could be just over a decade away – according to energy experts and analysts. While energy independence has been a touting point for Presidents coming into office since Richard Nixon in the 1970s, few have done much to help accomplish it.

Phillip Verleger, a respected and accurate economist, argues that by 2023, the United States will be energy independent in the sense that the country will export more energy than it imports. This change in the energy equation could lead to America having access to energy supplies at a much lower cost than other parts of the world.

Thanks to changes in technology for horizontal drilling and hydraulic fracturing, the United States is estimated to have enough gas to sustain today’s rate of production for more than a century. This translates across the country, in places that were otherwise once considered stagnant, into economic growth, new jobs and rigs popping up across the country in new discoveries in the Bakken fields and Utica shale.

When President Nixon began “Project Independence” in reaction to the OPEC oil embargo in 1973, the goal was to “achieve energy self-sufficiency for the United States by 1980 through a national commitment to energy conservation and a development of alternative sources of energy.”

Today it’s the same scenario and goals, but we’re actually much closer to achieving it. In the 1970s after the 1973 oil crisis, the United States was importing nearly half of its petroleum needs at insanely high prices and it was widely believed that the country was nearly out of natural gas. Fast forward to now. The US Energy Information Administration estimates that by the end of the decade, half of the crude oil America consumes will be produced domestically and 82 percent will come from the U.S. side of the Atlantic.

In a report released earlier this summer by Citigroup analysts, the United States is the world’s fastest-growing oil and natural gas producer. Including the output from Canada and Mexico, North American is the “new Middle East.” Similarly, energy billionaire and no stranger in this industry, T. Boone Pickens, predicts the United States can at least end oil imports from OPEC countries through new drilling and by shifting diesel-consuming vehicles to natural gas. All other oil needs should come from politically stable allies such as Canada, Pickens adds.

Even if the country were to end its imports from OPEC countries, as a country with vested interests in the Middle East still – regarding Israel and keeping nuclear weapons and technology from spreading, it is still susceptible to big influxes in the state of the Middle East. That coupled with the countries growing unease with hydraulic fracturing and the debate of contaminating water supplies seems to be some of the only hurdles yet to cross.

What else do you foresee happening before the country reaches energy independence?


Source: SherWare Blog

Phil Sherwood
 

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