Bell: Use fracking to subdue Russia

The best weapon against Putin’s aggression in the Ukraine and elsewhere lies right beneath our noses and feet. Unleashing America’s abundant oil and natural gas resources can not only greatly disempower Russia’s stranglehold threats against Europe and other allies, but can also strengthen our ties with those countries while providing energy independence, economic benefits, and jobs to increase strength at home.

Although major expansion of U.S. oil and gas exports to energy-thirsty Europe cannot be achieved overnight, commitments to do so can have immediate leveraging effects around the world.

With oil and gas accounting for more than half of Russia’s federal revenues and three-quarters of total exports, their economy is highly vulnerable to prospective as well as actual price devaluations.

Putin now wields power to hold Europe captive as an energy hostage. According to Gazprom, their state-controlled gas company, Russia controls as much as three-fourths of Europe’s natural gas imports including more than half of Ukraine’s and 39% of Germany’s. And although the EU is less dependent upon the trans-Ukraine pipeline system now than it was when Russia choked back supplies in 2006 and 2009 amid financial disputes between Moscow and Kiev, few can forget the impact.

Soaring gas prices across Europe brought severe gas pain to more than a dozen nations. As a result, Russian threats to cut off gas supplies in winter, as it did to the Ukraine twice during the past decade, must be taken very seriously.

Europe would likely be far less vulnerable to Russian oil and gas squeezes were it not for alarmist environmental objections to fracturing.

While it’s not clear how much shale oil and gas Europe actually has, they cannot know until they try. One of the best opportunities for shale may be in the Ukraine. Realizing this, Russia has worked behind the scenes in recent years to promote European anti-fracking activism.

To make matters worse, in the wake of Japan’s 2011 Fukushima disaster Germany has declared that all of their nuclear plants will be shut down by 2022 rather than 2036 as originally planned. They already pay three times more for electricity than we do, and this will raise energy costs even higher, with particularly disastrous ramifications for industry.

Thanks to horizontal drilling and fracking, the U.S. is on track this year to surpass Russia as the world’s largest gas producer and to take over the top oil-producing spot from Saudi Arabia by next year.

By stepping up production and exports we can lower global prices and volatility, and also lessen threats of energy blackmail by Putin’s petrodollar-dependent kleptocracy.

U.S. petroleum exports will reach a six-decade-high level this year with the potential to increase much more. One hurdle is a ban on crude oil exports dating back to the 1970s energy crisis which represents a problem for the “light tight oil” extracted from the Bakken and Eagle Ford formations. Domestic refiners are more geared towards heavy crude, resulting in lowered production.

On the natural gas side, the Energy Department has been intentionally slow-walking its case-by-case processing of LNG applications. More than 20 cases have been pending for more than a year, with only six approvals since 2011. DOE licenses can take months, with the last four permits issued requiring more than two years.

Although a law makes it difficult to export natural gas to countries that aren’t free-trade partners, current Russian actions in the Ukrainian province of Crimea provide urgency to overcome the hurdles.

President Obama has the authority to set the ban aside simply by issuing an executive order in the national interest. He also has ability to expedite permits on new liquefied natural gas terminals that can ship to Europe as part of EU-U.S. trade negotiations.

Major questions remain whether the President will continue to resist actions which can enable our nation to fully develop and apply vast resource opportunities by opening up public lands for energy exploration. Nearly all gains in U.S. oil and gas production have occurred on private lands.

It’s also high time to approve the Keystone XL pipeline which has been needlessly delayed pending seemingly endless studies for the past 5 years. Keystone is currently under a 90-day State Department–White House review to determine if it is in the national interest. Again, that answer can hardly be in doubt.

There should also be no doubt that the West’s best defense against Russia, Iran, and other autocratic energy antagonists is a bold energy offense. Immediate action on this battlefront are essential to convince brazen tyrants and nervous allies around the world that American leadership through strength can really be trusted.

Originally posted on Newsmax: http://www.newsmax.com/LarryBell/Fracking-Putin-Ukraine-Russia/2014/03/10/id/556979#ixzz2vcXVCR62