T. Boone Pickens, legendary oilman and Oklahoma university benefactor, has a plan to relieve our oil addiction, that pesky substance abuse problem first identified by President Bush in January 2006.
With crude oil prices hovering around $140 per barrel, Boone says payments for our nearly 70 percent import requirement represent “the greatest transfer of wealth in the history of mankind” ” more than $700 billion a year at current prices.
A good chunk of that goes to our northern and southern pals in Canada and Mexico, but at least $400 billion yearly goes elsewhere in the world ” much of it to some not-so-friendly places.
The president last week again reminded us he has no “magic wand” to lower gas prices, but he did symbolically end an executive ban on offshore drilling. The ban was first imposed by his father in 1990 when oil was under $20 per barrel and energy-producing states, like Oklahoma, were struggling to emerge from the rubble of the oil and banking bust.
Congress also needs to pass legislation approving offshore exploration, but oil and gas production may be a decade away. Likewise for the Arctic National Wildlife Reserve. If oil exists in ANWR, it may be years before it finds its way into gas tanks.
But drill we must, anywhere and everywhere and fast, if only to determine what significant petroleum and natural gas deposits exist in untapped locales. Knowing what is out there will help us transition as much of everyday life as possible to whatever will substitute for hydrocarbons.
Which brings us back to T. Boone Pickens. Boone says the current energy crisis is “an emergency we can’t drill our way out of” so he wants to harness the wind, of which Oklahoma has plenty. His plan: With the right leadership, wind energy could substitute for roughly 20 percent of electricity now generated by natural gas. Citing government estimates of wind potential, Boone sees this possibility within a decade.
In turn, natural gas would become the fuel of choice for automobiles, which, by Boone’s calculations, would trim about $300 billion from our import tab. Putting his money where his mouth is, Boone is building a 4,000-megawatt wind farm near Pampa, Texas, and recently placed a $2 billion order with General Electric for the first batch of turbines.
Peak oil prices can be win-win-wind for Oklahoma, too. We now have the best of both current and future energy worlds: substantial growth and recession protection from a hydrocarbon-dominated state economy and a position within the “wind corridor,” which runs from west Texas, through the western portion of Oklahoma and on up to North Dakota.
So, while our Oklahoma energy companies hire new employees faster than their pictures can be published, we also can continue to ramp up our wind energy production for America’s future.
Thanks, Boone, for breaking into wind. At last, somebody is doing something about our oil addiction other than wishing it would go away. But, Boone is right, it will take real leadership to tackle this crisis, not a magic wand.
If Oklahoma helps lead the way we will become a “fly-to” state of the future, not the misperceived “fly-over” state of the past.
Keith Hazelton is an economic consultant and wealth manager living in Oklahoma City.