As we are winding down 2007, I thought it would be interesting to look a little more clsoesly at one of the big issues that will carry over from 2007: The Roan Plateau. There has been much fighting in Colorado and Washington, DC over this issue and it is hardly resolved. It is also of great import to all of us, so let's spend a little more time looking at it. On what basis am I making my claim of its importance? Well anytime you have elected officials fighting over one issue at the local, state and federal levels, then you have one issue to watch closely.
I have previously posted on this issue and some of the feuds over it, but let me give you some interesting facts and info.
Let's start with the area formerly known as the Naval Oil Shale Reserve (NOSR). The NOSR was first established by President Woodrow Wilson for the purpose of providing a reserve supply of energy to the US in times of shortage or emergency. It comprises only a portion of the Roan Plateau, but estimates put the potential for six trillion cubic feet of natural gas. That is enough natural gas to heat four million homes for 20-25 years.
You also may not realize, but significant amounts of natural gas are used in the production process for creating ethanol. Yes this clean environmentally friendly fuel uses natural gas to produce. According to a Dec 3, 2007 Congressional Research Service report, increasing the volume of renewable fuels to 36 billion gallons would increase demand for gas by 1.6 trillion cubic feet. Such a significant increase in demand would drive up the price for natural gas significantly, meaning all of us will pay much more out of pocket. Also, many communities around the country are trying to convert their coal plants to natural gas since it is cleaner burning, further driving up demand and thus price. US production of natural gas is down 4% since 2000, just as demand is going up.
So we NEED significant new supplies of natural gas. If we do not produce it, then it will come from other countries, thus doing nothing to reduce our dependence on foreign energy supplies. We can just get it from Canada since they are not dangerous to us. Think again, our imports from Canada fell 3% in 2006. Anyone with a cursory understanding of supply and demand knows the inevitable result: Higher prices.
Notice that I haven't even talked about the potential revenues to Colorado. As you can see, the revenue side of the equation isn't even needed to make the case for opening up this treasure trove of vital natural gas. It just sweetens to pot, but we will save that for future discussions, and you can bet there will be future discussions on the issue of the Roan Plateau. What do you think will be the big issues for 2008?
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