Psst: Don’t tell anybody, but the worst-kept secret in Pennsylvania is that the natural gas industry — the only economic salvation of the Keystone State — is leaving in droves, replaced by job loss, budget holes, and despair.
Like most tragedies, this one was preventable. Only common sense and foresight were required. But those traits were pumped dry long ago, so instead of experiencing a booming economy rooted in the rebirth of American manufacturing, Pennsylvania is now witness to yet another exodus of its best and brightest. And the march toward permanent mediocrity is accelerating.
|The Consol Energy Horizontal Gas Drilling Rig is exploring the Marcellus Shale, which could contain more than 500 trillion cubic feet of shale gas in parts of Pa., N.Y., Ohio and W. Va.
As with most things, elected officials couldn’t see the forest for the trees, and now that the gas industry is packing up their mobile rigs and making for greener pastures, (or, more accurately, black pastures, as in Black Gold), the newly passed gas “impact” tax is likely to have little impact.
Why is the gas industry leaving? Simple. It is losing money hand over fist, as natural gas is sitting at a 10-year low due to lack of demand. So let’s get this straight. We ignore cheap, abundant and clean natural gas while continually getting hosed at the pump from record-setting oil prices. And as a result of soaring gasoline prices, inflation is rising unchecked and true economic growth is vaporizing before our eyes.
Only in America. Literally.
No other country would permit such self-destruction, willfully sending hard-earned money to overseas adversaries while doing everything in its power to bite the (domestic) hand that feeds it. And that paralyzing incompetence comes from being fat, dumb and lazy while aggressive competitors do whatever is necessary to gain an advantage.
So the U.S. remains energy-dependent. In addition to the obvious national security concerns (we wouldn’t be expending blood and treasure in the Middle East if we drilled domestically), we are willfully engaged in the greatest transfer of wealth in the history of mankind, as hundreds of billions go to China and Middle Eastern oil barons because we refuse to harness our natural resources.
The way out of the recession (permanently) is to keep American petro dollars here. And by the way, “here” doesn’t include Canada, since it too is a foreign nation. The Keystone XL pipeline, while nice, neither achieves energy independence nor creates large-scale American jobs. But never let the facts stand in the way of a good political gimmick.
America will never compete with Chinese labor costs, but the untold story is that we don’t have to. We beat them by having the world’s cheapest energy costs, and that, along with reworked trade policies, would level the manufacturing playing field and get America making things again.
Just look at Proctor and Gamble’s huge manufacturing plant in Pennsylvania. An energy bill in the tens of millions was virtually eliminated after the discovery of natural gas under the plant. Savings that large leads to company expansion, additional jobs, more service industries, and a larger tax base.
But instead of embracing that kind of success, our leaders have punted the ball because they have no game plan. And now it’s getting late in the fourth quarter.
But there is an opportunity that could provide a boom on a much greater scale: convert idled refineries to process natural gas rather than the much more expensive crude oil.
(Note: While a Delta Airline’s subsidiary just bought a refinery to make its own jet fuel, we’ll see whether that high-altitude idea flies, since airlines have a hard enough time staying in the air financially. An airline getting into the fuel business has the right idea, as lower fuel prices will make its bottom line take off. But given the industry’s track record, that type of diversification could send Delta into a tailspin, possibly ending in a crash-and-burn scenario. And that would occur for much the same reason that the oil companies themselves are divesting themselves of their refining operations — wild fluctuations in the price of oil and mindboggling regulations make it inherently unprofitable.)
If Delta really wants to lower costs over the long haul, it might consider retooling its refinery to convert abundant natural gas (from only 100 miles away) to jet fuel, rather than relying on oil from across the world in an ever-volatile market.
Sure, converting a refinery takes significant investment, but it is one that would pay huge dividends given America’s insatiable appetite for energy (and in Delta’s case, jet fuel). And that’s a good thing, because increased demand means the economy would be gaining strength (unlike the disingenuous “recovery” claims now made by government and the media).
Dry natural gas could be converted to gasoline, diesel, and jet fuel at a consumer price point that may well be under $2 per gallon. Fuel that inexpensive becomes an instant win-win: the rebirth of manufacturing, big job gains, and the satisfaction of knowing that national security is bolstered every time you hit the pump.
It’s time to “refine” our way of thinking. Failure to convert the refineries may well kill off the gas industry altogether, making us ever more dependent on foreigners for our vital energy needs.
But if we rekindle that slumbering can-do American spirit and put America first for a change, the possibilities would be limitless, and we would no longer be bent over a barrel.
And what a gas that would be.
An accredited member of the media, Chris Freind is an independent columnist, television commentator, and investigative reporter who operates his own news bureau, Friendly Fire Zone. Read more reports from Chris Freind — Click Here Now.
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