All the coverage of President Bush's energy speech today is focusing on his call for ending a federal ban on offshore oil drilling, two days after John McCain flip-flopped to take the same position. The idea may or may not have merit in the long run, but what it won't do is lower gas prices in the short term: the Department of Energy estimates that it would take more than twenty years for either production levels or prices to be affected by a repeal of the ban on offshore drilling. The usual retort is that it could still lead to lower prices now by easing jitters and thus helping deflate what looks like a bubble in oil markets, but given that the amount of oil at stake here is very small (about 19 billion barrels, equivalent to around seven months of global consumption) and wouldn't come online anytime soon, that doesn't seem very likely, which is what the DOE concluded.
Ultimately, a more notable proposal in Bush's speech is the one to allow oil shale leasing on federal lands in the Green River basin in Utah, Colorado, and Wyoming. Unlike the offshore-drilling idea, oil shale development, at least in theory, promises a lot of oil: the Green River basin alone may hold 800 billion recoverable barrels. Unfortunately, the idea also has a number of other problems. For one thing, nobody really knows to how to do it well: Bob Loucks, a former oil shale production manager, told Environmental Science and Technology that "Despite all the attempts to develop a shale-oil industry in the U.S. over the past 100 years, the fact remains that no proven method exists for efficiently removing the oil from the rock." And whereas oil companies say they can drill for conventional oil in environmentally sensitive areas without disturbing the environment, no one even bothers making that claim when it comes to oil shale development, which by its very nature requires disturbing huge tracts of land. It also produces a fair amount of groundwater pollution--which, if it winds up in the Green River, could contaminate the rest of the Colorado basin. Suffice it to say that there are lots of people in Las Vegas, Phoenix, Los Angeles, and San Diego who would not be pleased.
And then there are greenhouse gases: If you're a fan of regular fossil-fuel carbon emissions, you'll love oil shale. According to a study (pdf) by UC Berkeley's Adam Brandt, all told oil shale produces between 27 and 52 percent more GHG emissions per unit of energy than conventional oil, in large part because of the enormous amount of energy required to heat the rock in order to yield oil. Indeed, it takes so much energy in other forms (likely electricity from coal) to recover oil from shale that the net energy benefit ends up being much smaller than it appears--sort of like the corn ethanol of Utah. Needless to say, this should (and almost certainly will) be a non-starter with Democrats in Congress, who wisely inserted the ban on federal oil shale leasing into an omnibus spending bill last year.
So even if you're not thrilled by the Bush–McCain plan to drill for oil offshore, take heart: At least it's not the worst idea from the president's speech today.