TOTAL of Potential Natural Gas and OIL Royalties– $2.576 Trillion
Please take the time to read the information at that link. Tom Blumer adds these facts and figures to go along with this link and chart:
Even if you adjust Peterson’s calculations to reflect current prices of roughly $100 a barrel for oil and $8/mcf for natural gas, the royalties locked up still amount to over $1.8 trillion (about $500 billion from natural gas, and $1.3 trillion from oil).
But that’s only the beginning.
Estimates of known reserves have almost always been low. There is no reason to believe that things are any different now. For example, over twice as much oil has come out of Prudhoe Bay than was initially predicted. A repeat of that result with offshore reserves would not be at all surprising, especially because Congress has prohibited even exploring the areas involved for years. Using $100 a barrel as the current price of oil, that’s at least another $1.3 trillion in royalties.
Then there’s shale oil. This Wikipedia entry shows over two trillion barrels in estimated U.S. reserves. Assuming that only 10% is recoverable, that’s another $3 trillion in potential royalties.
If you’re keeping score, we’re at about $6.1 trillion. That’s more than 60% of the current national debt of $9.8 trillion, which is set to shoot up to a frightening degree in the coming years thanks to Uncle Sam’s bailout binge.
The real number for potential royalties is much higher. I ignored additional royalties from offshore natural gas. I also didn’t look at royalites that might come from oil obtained from sands, oil and gas in North Dakota’s Bakken Formation, oil and gas in the Great Lakes, or future oil and gas discoveries.
On top of all that, according to a spokesman for Congressman Peterson, the federal royalty rate for land-based extraction is typically much higher than the 15%-plus off shore rate. States also collect substantial land-based extraction royalties on top of Uncle Sam’s take. The total can be as high as 50% of the market price at time of extraction, with 25% going to the Feds and 25% to the states involved.
Even beyond the royalties involved, Uncle Sam, state governments, and local governments would collect additional billions in corporate and individual income and payroll taxes because of increased business activity.
For decades, both the executive and legislative branches of our supposedly “by the people, for the people” government have mostly done all they can to keep us from using and benefiting from our own resources. By doing so, even at the much lower prices in previous years, they have caused the government to lose out on tens of billions of dollars a year. At today’s prices, if we capitalize on the recently-lifted offshore bans, annual amounts coming into the Treasury could easily run into the hundreds of billions.
Our representatives should be embarrassed by their past quarter-century of energy negligence. The American people should be infuriated, and would be demanding a full-speed-ahead on domestic exploration and drilling — if they only knew.
October 6, 2008 - 01:32 PM on October 6th, 2008
And even while our energy costs are going up ROBERT KENNEDY Jr and LEONARDO DeCAPRIO are doing junk mail stuff for the various eco-freak groups opposing drilling in the ANWR giving the usial bunch of eco bull kaka how the areas are fragile and it will distrub the wildlife WHAT A LOAD OF CRAP why dont those two jerks go and TAKE A HIKE and quit lying SCREW THE ENVIROMENTALISTS
January 22, 2009 - 10:28 PM on January 22nd, 2009
Can someone please explain how our gov’t can justify trying to shut down an industry that produces these amounts of revenue in favor of the “GREEN” alternatives??? It will cost BILLIONS to fund the “GREEN” energy solutions that will not produce anything for many years to come. We are being Hoodwinked…Bamboozled!!!!! WAKE UP AMERICA!!!!!!!!
January 23, 2009 - 07:19 AM on January 23rd, 2009
I am not seeing the justification of the left trying to demonize an industry that is employing people..At this point, it would help our economy of we were employing people in old and new energy…Hell, it would help our economy if we were employing people..