Is the deficit fix right beneath our feet?

Nearly $130 trillion in oil and gas resources are buried under US government land, worth about 8 times our national debt. But tapping it isn't so easy.

By Aimee Picchi Feb 6, 2013 1:13PM

Oil derricks -- Comstock/CorbisA solution to the country's growing national debt sits right beneath Americans' feet, according to a report from the nonprofit Institute for Energy Research.


That's the $128 trillion in technically recoverable oil and gas resources below 41 million acres of federally owned land, according to the group, which advocates for "freely-functioning energy markets." The chief executive of the group is a former director of policy analysis at Enron.


The "federal government’s mineral estate land holdings surpass the total surface land area of the nation of Canada," according to the report. "These holdings, as we will see, are vastly underutilized."


Most of those below-ground assets are mineral and energy resources, such as oil and coal. Among those hidden deposits are 10.4 billion barrels of oil in the Arctic National Wildlife Refuge and 420 trillion cubic feet of natural gas in the continental shelf off the lower 48 states, the report notes. 


Right now, the government leases only about 2% of federal offshore areas and 6% of onshore lands. 


But tapping those resources isn't so easy. 


For one, not all federally controlled lands are open to leasing, as noted by the Congressional Budget Office in a study last year.


Leasing is statutorily prohibited in the Arctic National Wildlife Refuge, for example, the CBO noted. It estimated that opening the land up to development would lead to about $5 billion in additional revenue over the next decade. 


And opening the refuge and other wilderness areas to drilling and mining would undoubtedly spur a backlash from Americans who believe such areas should remain undisturbed by mining and other human activities.


One such group is the Defenders of Wildlife, a national nonprofit conservation organization that advocates protecting the area. According to its site, "the Arctic Refuge is under assault. The oil industry and its political allies continue to launch attacks to open this national treasure to destructive oil and gas drilling, while climate change threatens to disrupt its habitats faster than wildlife can adapt." 


It's not as if U.S. taxpayers aren't already benefiting from minerals hidden under the country's federally owned land. Revenue from all oil and gas leases on public lands will amount to $150 billion over the next 10 years, according to the CBO. 


With the Institute for Energy Research pushing for greater development, it may be taking the advice of oilman J. Paul Getty, who said, "The meek shall inherit the earth but not its mineral rights."


More on moneyNOW


342Comments
Feb 7, 2013 7:07AM
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Yes and WHO will tap it exactly. Not the American people. They won't see a plug nickel. It will be handed over to the oil and gas companies as usual for their lobbyist's donations to their favorite congressional oil and gas cheerleaders.
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The (Kill your kids/save the whales) philosphy is absurd. So a few birds die occassionally what's more important a human life tied down because of some enviromentalist wacko group who believes animals have more value than humans, yet live in the city and visit Starbucks on a daily basis, The enviroment and technology can live in harmony. get rid of Obama and that nut case Al Gore, quit allowing them to sell you out to the arabs or Vensualens. It's our land, our oil, minerals and gas deposits, why buy from countries who'd rather blow us off the map, buy their oil and give them the money to build nuclear bombs and support terrorism, that's real smart huh?
Feb 7, 2013 2:17AM
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The well is already in place so start pumping and give me my mineral rights royalties.

Feb 7, 2013 1:16AM
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Obozo knows we have more oil then the Middle East but, then how does he pay back all the islamist who paid for his education?  He is here to make the U.S. a third world country so that we can give into the UN, and he believes he will run the UN someday and be messiah of the world, a little egoist with a godhood dream and if he does, only last for 7 years and then he joins his daddy satan in the lake of fire.  What a little Hitler the butt head is.
Feb 7, 2013 1:15AM
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I heard that the government is using the federal land as collateral to china for the money we owe them so we cant even drill on our own land. every thing we are going thru is because of them.

Years ago they asked us to do business in other countries to build them up. and now they are criticizing us for doing what they asked. Mental health problems are there's too we are the only country that has no place to put the mentally ill the government closed them all down.

Feb 7, 2013 12:46AM
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Obama has rescinded federal leases because he says they are "not being used." There is a reason for that - it's called government red tape and environmental group backlash. Since oil is priced on the world market it probably won't make any difference anyway.

Feb 7, 2013 12:44AM
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When I was growing up in the Texas and Oklahoma area, my father worked in the oil business. He was curious as to why back then the companies kept capping wells all over the countryside for no good reason. They were producing, and still many untapped wells. We have been sold a bill of goods for a long long time I'd say.
Feb 7, 2013 12:28AM
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Just keep sending the same old plugs back to Congress and the White House and we will continue to keep getting the short end of the stick. Kick them all out, make them go by the same laws (social security, retirement, insurance, etc) that we the people have to endure and create term limits. That will be a start.
Feb 7, 2013 12:13AM
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Did we mention here that petroleum products are NOW America's No.1 export? What are we intending to do with the other stockpiles? Oh yah,we will pilfer it away for the greed of the wealthy few,and not tell anybody what we are doing with it! What,you say we are already doing this,and the Keystone Pipeline will double exports? No sh!t Sherlock!
Feb 6, 2013 11:56PM
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if were selling what we drill on the open market what's the point of drilling. Its not going to go to us.all your going to do is pollute our lands and make oil companies even richer .gee the oil companies wouldn't screw us over for a buck would they?ya think!

Feb 6, 2013 11:49PM
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General Electric (GE) has a train engine that runs on diesel and electric and can haul 2 tons of cargo almost 500 miles on ONE gallon of fuel. So with that said, this could be scaled down to a car or truck side. But you will never see this happen in your life time. Why, just think lose of taxable income to Federal, States and Counties but most of all record job loses, no more big oil companies. No more CEO's getting BIG bonus.
Feb 6, 2013 11:45PM
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we need to suck the life outta this planet..harvest everything now..before some other country does..

then we can gloriously claim..we won..yeh..baby...USA..USA...USA...

 

it will pay for the financing and mining of the other planets..yeh..baby..   harvest evry damn thing...

 

and give no-one a break..scum..takers...47%ers what a group of losers..

 

the 2-3 % ers need to run everything..control everything..have everything..

 

Feb 6, 2013 11:24PM
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First of all... whoever said we have all those resources sitting there is exaggerating the statistics.  Second, even if we had all those resources on hand it would only drive down prices and kill the market.  Third, if we tapped into those resources, it would only take about 500-1000 years to use an sell all of them.  It's not a magical answer to our debt. 

  By the time those resources are finally used, this country will probably not belong to us anyway.  I'm thinking China will invade by then.

Feb 6, 2013 11:17PM
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You know what the problem would end up being?! Anytime the government asks someone if they can drill on their land, the land owner is going to charge the government such a high price to drill because they think its there chance to score big. Causing the government to charge the same price as an international company to ship it in and we will all end up right where we are now anyways. And it will all be due to greed.
Feb 6, 2013 11:02PM
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I say the second our government says we're giving the rights of this reserve to China, time to wipe the slate clean of them.
Feb 6, 2013 10:50PM
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Our government is so crooked it makes the mafia look like choir boys.............
Feb 6, 2013 10:33PM
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What this ignores is how many trillions in drilling costs will it take to "prove up" these o&g reserves (my guess $50+ trillion at least).  Since she uses the word "resources" rather than reserves for the $130 trillion, this is likely a figure for which a considerable portion is not economically recoverable.  Also there are big dollars in lease bonus payments (to the US govt) plus operating expenses to produce these o&g reserves.  Then there are severance tax payments to the state govts and ad val taxes to the counties and local school districts.  So not as much as one would think ends up in the hands of the o&g producing companies.

The southern portion of the US has the majority of the sour crude refining capabilities for this part of the world.  So this is why we receive crude imports and then ship the refined products out.

Lastly there are ZERO subsidies given to the o&g companies...period.  There are tax deductions allowed for mid-sized o&g producers for the costs incurred in drilling wells,  But this is a "zero-sum-game" in that this recouped after 5 years (i.e. tax deduction taken in the year the well is drilled rather than evenly/equally over a 5 yr period).  So this is simply a timing issue.  The subsidies are what Obama hands out to solar and wind energy businesses as most are not economically viable.

Feb 6, 2013 10:32PM
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WHAT MSN REPORTING THAT OBAMA IS HOLDING DOWN CHEAP ENERGY PRODUCTION? WHAT THE? MUST BE ON THE

WRONG NEWS SITE! NO KIDDING SHERLOCKS? WHERE THE HELL HAVE YOU BEEN? WHY DIDN'T YOU ASK HIM THIS HARD

QUESTION DURING THE ELECTION? STUPID LIBERAL RAG! TO PUSH HIS GREEN EXPENSIVE AGENDA ON AMERICA! DOPES!

DO YOU STUPID LIBERALS SEE THE PRICES SKYROCKETING??? ENERGY FOOD CLOTHES ETC...??? OH THAT'S RIGHT YOUR

ALL ON THE OBAMA FREEBIE BIG GOVT NANNY STATE CHECK TRAIN SO YOU DON'T PAY FOR CRAP THE REST OF US DO!

Feb 6, 2013 10:21PM
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Yes I can see it now the rich get richer and poor you guess it no where just poorer
Feb 6, 2013 10:13PM
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Pay close attention to the remarks left here by these flatheads.

 

The oil and gas found here are sold elsewhere, because the oil companies can get more money for it.  Even if it is sold here, the world price is what's paid.

 

Further, the great thinkers of this column haven't been affected by fracking, etc.  They'd scream if their water quality went south.  It wouldn't occur to them to cheer and say Hooray! We're solving the energy crisis!!  They would bitch about their water quality--probably writing to this space.

 

The Congress has seen to it that banks, insurance companies and oil companies are in charge.  Whine about Obama and whomever else you want, but change ain't coming, folks.

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