Republican Ohio Governor Kasich's Trillion Dollar Shale Gas Lie

Fri, 2012-08-10 10:27Farron Cousins
Farron Cousins's picture

Republican Ohio Governor Kasich's Trillion Dollar Shale Gas Lie

About the only positive thing you can say about industry-funded astroturf groups is that they at least base their misinformation campaigns on phony “studies” and “reports.” Their lies are based on SOMETHING.

The same cannot be said of Republican Ohio Governor John Kasich, who has come up with a whopper based on absolutely nothing. Kasich recently told the press that his state of Ohio is sitting on top of $1 trillion worth of natural gas that’s just ripe for fracking.

Obviously, this would be quite an economic boom for not just Ohio, but the entire United States. The only problem is that, again, Kasich isn’t basing his estimate on any studies, reports, documents, surveys, or anything even remotely credible. It appears that Kasich is telling reporters that this trillion dollar bonanza number is what he overheard from members of the natural gas industry.


CityBeat explains the story:
  

Arthur Berman, a Texas-based petroleum geologist and independent energy consultant, says there is no way to verify Kasich’s number.

“No one knows what the reserve number is,” he says. “It takes longer before we know.”

Berman says a true analysis would take at least 18 months and, more realistically, eight to 10 years. This is because geologists need to wait until they “have enough months of production to see a trend,” Berman says.

Even when enough time has passed and geologists get a real estimate, Berman says there will still be a lot of uncertainty about how much of the oil and gas can actually be obtained. He says that although there might be a lot of oil and gas, it could be inaccessible due to technological and practical constraints. After all, if oil and gas reserves are found beneath a city, it’s unlikely operators will actually try to drill there.

Another question for Berman is whether Kasich expects the $1 trillion to come over time or immediately. With the way Kasich has been presenting the number to the media, Berman is worried Ohioans might be getting the impression that the $1 trillion would come as an “immediate windfall.” The reality, Berman says, is that “it takes a long time to produce natural gas and oil.” That means even if Kasich’s number was somehow right, it would take years — Berman estimates longer than Kasich’s gubernatorial terms — to see that $1 trillion.

Kasich claims he heard the number from an unnamed CEO at an energy company. That brings up some concerns for Berman. In his experience, oil and gas operators tend to overestimate production potential by about double, relative to Berman’s own data. Berman says they could be overestimating because it makes the venture seem more profitable to investors.

To truly understand how much oil and gas is underground, Berman would like to see an independent, objective opinion. More importantly, he hopes that Kasich would demand a higher standard of analysis before promoting any policy.

“I hope the governor would make decisions based on more than a lunch conversation,” Berman says.
 

Berman is absolutely correct – the head of a state needs a little bit more information than can be gathered through eavesdropping in order to come up with policies for his state.

So why the trillion dollar lie? Kasich isn’t a member of the industry, and as a whole, Follow the Money tells us that Kasich received a meager $50 from the energy industry during his last campaign. But things aren’t always what they seem. The fracking industry has been much more generous to Kasich than the reports would have you believe.

A Truth-Out report from last year reveals that Kasich actually received more than $213,000 from the natural gas industry, more than any other Ohio politician in the last 10 years. The Truth-Out report also tells us that Kasich was the recipient of an additional $127,000 from Koch Industries.

Not only does this money explain Kasich’s trillion dollar lie, but it also helps us understand why he has opened up state parks and other protected lands for natural gas companies to frack.

In the era of Super PACs, political money flowing to candidates is going to become harder and harder to trace. But when you’re making the rounds on the media, telling lies worth one trillion dollars, honest and hard working investigative journalists like those at Truth-Out and elsewhere are going to do their homework and figure out the truth.

[x]

ExxonMobil, the nation's largest oil and gas company, will begin disclosing risks associated with shale drilling and fracking to investors, in response to a long-running campaign by a coalition of shareholders.

In February, the groups of investors in a handful of major oil and gas companies including Exxon, Chevron and EOG Resources, demanded for the fifth year in a row more information from companies about the risks associated with fracking. The motion...

read more