Several months before he was fired by President Barack Obama on August 26, 2013, then-US Ambassador Philip D. Murphy delivered a speech in German praising the benefits of hydraulic fracturing, commonly called fracking, as a way to coax more oil and gas out of the ground.
Fracking is the process of drilling down into the earth before a high-pressure water mixture is directed at bedrock to release the gas and oil inside. Water, sand and chemicals are injected into the rock at high pressure which allows the crude fossil fuels to flow out to the head of the well.
The process is terribly destructive to the environment, it destabilizes underground bedrock foundations of the planet and it increases the output of harmful greenhouse gas emissions, which contribute to deadly climate change.
Murphy gave his speech at an event sponsored by Handelsblatt (which literally means “commerce paper” in English), a leading German language business newspaper published in Düsseldorf.
Murphy refused to submit answers to a survey from Food & Water Action Fund about issues like pipelines, fossil fuel infrastructure, renewable energy and clean water.
This is a translation of Murphy’s speech, based on the original, which is posted in German on the website of the US Embassy in Berlin, which the Wall Street millionaire once headed.
BERLIN – (AD) – Below we publish the prepared speech by US Ambassador Philip D. Murphy on the slate gas shift in the United States, which he held on 23 January 2013 at the Handelsblatt anniversary of the energy industry in Berlin.
Thank you very much for your invitation to be with you this morning. I congratulate the Handelsblatt on the 20th anniversary of this conference. 20 years ago – immediately after the Wende – Germany played a very different role in world politics. The decisions taken in Germany at the time ultimately influenced the history of Europe and the world.Twenty years ago, the energy industry – the energy mix we have used, access, storage and transport of energy – was also quite different. As far as current energy policy is concerned, Germany has decided to take a courageous new path with its energies. With a focus on renewable energies, Germany has the potential to redesign global resource policy. This is, of course, one of the most important issues that will be discussed at the conference this year.
But I am very pleased that we have the opportunity to discuss another turning point in the history of 21st century energy – and that is the remarkable progress made in the production of natural gas.
The United States is undergoing profound change. This change, which we are currently going through, could be called “slate gas turning” to use a German term. Has just as the reunification of Germany changed our world and the energy change has the potential here to open up a new world of inexhaustible, renewable energy, the energy landscape in the United States by the current success of hydraulic fracturing be significantly changed by expanding the traditional energy sources In the short and medium term. This development is also revolutionary.
The other participants, Eldar Sætre and Michael Schmidt, will present the European view of natural gas. As energy experts, they will certainly be able to explain some more technical aspects. I would like to tell you about the enthusiasm and optimism with which we are heading in the United States for the technological developments that enable us to secure the natural gas flow, which is thousands of meters below the Earth ‘s surface and under the hydraulic fracturing or fracking Groundwater. The natural resources that are available to us are truly incredible.
I think you have noticed that I used the word “safe”. As I said, I am not an expert, but in addition to technology related to horizontal drilling, four-dimensional seismic representations, software models and hydraulic fracturing, which allows us to gain natural gas and petroleum from shale, a technology has also been developed To monitor the promotion in each individual phase. There are also laws and regulations to ensure the safety and efficiency of the process. In the United States, air and water are subject to federal laws. The individual states regulate the use of land and water. Both the federal government and the governments of the individual states are able to enforce these laws – and they do so too!
Last week, Professor Tim Carr from the Department of Geology at West Virginia University visited us. Some of the states of West Virginia, Pennsylvania, New York, and Ohio are located above the Marcellus Formation, a densely populated region in the United States where the production of shale gas is the fastest. Thousands of wells were drilled. Based on his experience, Professor Carr has conducted feasibility studies with countries around the world for this new method of shale gas production. On his return from Poland, where the possibility of shale gas promotion is discussed, he spoke with government representatives, above all, about regulations and their enforcement. Slate gas is not just a geological phenomenon in North America. There are enormous shale gas deposits all over the world.
Professor Carr also gave a press conference. The journalists here in Berlin have asked him about aspects of environmental security.
Our environment – our land, our water, our air – is simply too precious to endanger. However great the benefits of natural gas may be, they do not count if we can not be sure that the environment is not exposed to any dangers. We take the concerns of citizens in the United States seriously. Nobody wants to drink contaminated water, breathe polluted air or become the victim of a man-made earthquake.
Last year, President Obama asked Energy Secretary Steven Chu to set up a Blue-Ribbon Committee to provide recommendations on improving the safety and environmental sustainability of hydraulic fracturing in shale rock formations. The Committee dealt with three environmental issues – wastewater, air pollution and the impact on the surrounding communities – and recommended the implementation of some of the best practices. The recommendations include properly sealed well wells, reduction of water consumption and closer co-operation with municipalities on the ground. During his visit to Germany last year, Governor Corbett from Pennsylvania explained that his federal state insists on treating wastewater from fracking, So that it receives the quality of drinking water. Technological advances also reduce drilling and production efficiencies and the use of water, land, energy and chemicals. This leads not only to cost savings, but also to a lesser impact on the environment.
Many people have seen videos about tap water, the “fire catches” on the Internet. It was found that fracking was not the cause in any of the cases, but residents of rural areas who bore wells and inadvertently attacked natural methane reserves. In some rare cases, a defective sealing of wells – and not fracking – led to the escape of methane. This confirms once again the importance of the recommendations of Energy Minister Chu and his team. Transparency creates trust. The Committee has also recommended the full disclosure of liquid chemicals used in fracking. The companies are listed on the website www.FracFocus.org . Since the objective of natural gas drilling is the extraction of methane, There is a great incentive for the companies involved to keep losses as low as possible or to completely avoid them. Ultimately, this means that tens of thousands of wells have been safely drilled, and fracking is carried out in thousands of cases in the United States, in compliance with national and national laws protecting the environment and us human beings.
In addition, the slate gas turnaround results in very real environmental benefits. Because of the large natural gas reserves, prices have fallen drastically, and coal is increasingly being replaced by natural gas in the United States. In fact, we now use more gas to produce electricity than coal. Natural gas is a cleanly burning energy carrier whose combustion produces only half as many greenhouse gases as coal for the same amount of electricity. Advances in the efficiency of gas turbines will help to create additional environmental benefits through gas compared to coal. The power companies in the United States are planning to shut down 175 coal-fired power plants over the next three years. Just think about the impact on global emissions,
One of the most amazing developments in the rich natural gas reserves in the United States is the unprecedented reduction of CO 2 emissions and other particles. The number of US energy consumers has risen by 50 million compared to 20 years ago. By contrast, emissions in the United States have declined to the 1992 level – the year of the Rio Earth Summit and the first Handelsblatt anniversary of the energy industry.
There are other advantages. Natural gas can be viewed as an interim solution until energy can be reliably, sustainably and affordably obtained from renewable energies. Its availability is not dependent on the weather or the time of the day. As you know, wind and solar energy are occasionally either surplus when too much energy is fed into the grid, or a short supply when there is not enough wind or sun. As Professor Carr has explained, natural gas is also the perfect complement for renewable energies. Natural gas systems can be switched on and off – not necessarily at the push of a button, but quite simply to adapt to the availability of solar and wind energy. However, it is not so easy to switch a coal power plant on and off.
Low natural gas prices also make it increasingly used in the transport sector. Gasoline and diesel with clean combustion natural gas, leads to a significant reduction of car exhaust emissions. In many American cities, trucks and buses are already operating with natural gas. The futurists among us can safely predict when natural gas cars will be more widespread, especially since most households already have a natural gas connection. We all know that the development and implementation of technology can be costly. Economic and environmental incentives can foster the technological advances needed to make such vehicles reality and economic.
Often you arrive at a point where you begin to work cost-effectively and the implementation of new ideas is economically worthwhile – or not. Therefore, the state often finances basic research – the lengthy, slow, stupid and expensive phases, as an energy expert once described it. But when it comes to technological innovation, the lengthy, slow, stupid and expensive phases are almost always unavoidable because the benefits are too far away, the risks are too great and the costs too high. Innovations typically go through a process of lengthy, slow, stupid and expensive to small, fast, smart and inexpensive. For this reason, the state is constantly funding basic research for key technologies, which have proved to be important for our economic well-being. The most important innovations are those that create opportunities that would have been unthinkable before. This is also the case with this approach, which we now have to huge amounts of natural gas. It seems as if this new development came from nothing. On my radar screen she was not.
The fact is that the commercial fracturing technologies, which are now so successful, are based on the fundamental understanding of the hydraulic fracturing demonstrated by the US Department of Energy in the 1970s. The gas industry itself – including the shale gas pioneer George Mitchell – asked the federal government for help in finding out how to get gas from slate economically. And although research is continuing, after the foundations are known, at this time the private sector has become the driving force behind the innovation, efficiency and development of shale gas and oil resources. The shale gas revolution has led to reduced emissions, economic growth and increasing energy security due to entrepreneurship and market forces.
So if one asks whether the shale gas revolution means that the United States is turning away from renewable energies, the answer is clearly “no”. President Obama is pursuing all his options with his energy strategy. These include the increased use of US energy resources such as natural gas and oil, more energy efficiency and the development of clean, alternative fuels. In many states, such as California, for example, in the alternative energy sector, a certain percentage of the energy needs to come from renewable sources.
But one reason for our enthusiasm for the slate gas is obviously the fact that it also brings advantages for the US economy. The additional output as a result of shale gas and oil revolution in the United States will contribute an additional two to three percent of the real growth of gross domestic product by 2020. Various studies show that millions of Americans are already working in the shale gas industry – and many more jobs will be created. Professor Carr of West Virginia, a state that had long been struggling with high unemployment, said that the unemployment rate is almost zero in some areas and many places are unoccupied.
The economic benefits are obvious. When companies and consumers pay less for electricity, they have more money available for other expenses. This contributes to greater consumption and investment. The average American pays about nine euroscent per kilowatt hour for electricity; The German average household currently has to spend 26 cents per kilowatt hour – the trend is rising. Both the International Energy Agency and the Federation of German Industries have noted that low gas and energy prices are a competitive advantage for American industry. Low energy prices have led to a “re-industrialization” as the manufacturing industry invests hundreds of billions of US dollars in US chemical, fertilizer, steel, aluminum and plastic factories,
It is therefore no wonder that the shale gas revolution for the United States is, in our opinion, a win-win situation. It simplifies economic growth and, perhaps most importantly, has a significant impact on the environment and climate change. This is of global importance and these new developments in natural gas can lead to a win-win situation all over the world.
The US shale gas phenomenon is already changing global energy markets. The International Energy Agency assumes that the United States will become the world’s largest gas and oil producer within four years and will be independent of energy by 2035. Less than five years ago, US companies built the infrastructure needed to import liquid petroleum, now they are exporting facilities. Where there are spot markets, global natural gas prices have declined because we are getting so large quantities of slate. This has also fueled competition on the gas market, since the United States is no longer a large importer of liquid natural gas and no longer has to be. That is, supplies of liquid natural gas intended for the US market,
Increasing global natural gas inventories are already leading to greater market liquidity and more trades on spot markets. This could help to break the control of oil-indexed gas prices because of which Europeans are forced to pay five times the price in the United States. For years, Americans and Europeans have supported the opening of a “Southern Corridor”, which will bring gas from the Caspian region, Central Asia and the Middle East to Europe. We continue to support this goal, but the natural gas revolution will also lead to the development of an “Atlantic corridor” and thus to a further natural gas source for Europe. Liquid gas exports from the United States will accelerate this trend. It should also be borne in mind,
Because of their refining capacities, the United States is already a net exporter of crude oil products. The prognosis of the International Energy Agency is that the United States will be a net oil importer by 2030. This will reverse the traditional pattern of US energy trading and improve US trade deficit: according to a recent study, oil and gas exports could reduce our current account deficit by 60 percent by 2020. The same study assumes that the additional US oil exports on the world markets, together with a low oil consumption in the United States, which is due to the stricter fuel efficiency standards introduced by the Obama administration, will raise global oil prices by 14 to 16 percent Reduction.
We would like to share our experience, our research and best practices in safe and efficient shale gas and oil production. The Unconventional Gas Technical Engagement program of the US Department of Foreign Affairs helps other countries to identify their unconventional gas resources and to use them safely and economically. The program analyzes the potential of a country for shale gas production. In addition, governments will be given the support to take the commercial measures, as well as the security and environmental policies, which will allow the beneficial development of this resource. The US Department of Energy conducts a survey of unconventional gas for the Asia-Pacific region at the request of the APEC energy ministers.
All countries in the world need diversity in their energy supply. Energy security has become a defining issue in the 21st century. It is an element of a complex matrix with strategic, economic and environmental dimensions. We need to know where we stand and where we want to go. We have to show practical ways that lead us to the goal – shale gas is one such way. But it is not and must not be a static process. It will require constant vigilance, regular review of best practices and the strict implementation of safety and environmental regulations.
While, of course, we want Germany to have a lot of success at the Energiewende, the United States is trying to take advantage of the “Schiefergaswende”. Looking at the facts and the scientific data on the production of shale gas and shale oil, it is clear that slate gas is good for the environment, good for economic growth and good for supply security – not just in the United States, but worldwide.
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