Montana Voters Favor Rocky Mountain Oil and Gas Recovery

Montana Voters Favor Rocky Mountain Oil and Gas Recovery
February 1, 2004

James M. Taylor, J.D.

James M. Taylor is managing editor of Environment & Climate News, a national monthly... (read full bio)

A majority of Montana voters favor increased production of oil and natural gas in the Rocky Mountains, according to a December poll conducted by Mason-Dixon Polling & Research Inc. The poll results may suggest a growing consensus among Western voters that energy production is not necessarily at odds with environmental concerns.

“Montanans appear to recognize that higher incomes are key to preserving the willingness and ability to pay for higher environmental quality,” commented Richard Stroup, a senior associate of PERC, the Property and Environment Research Center in Bozeman, Montana. “In addition,” he noted, “many pollution control devices require the use of additional energy, so keeping energy prices reasonable will help keep the cost of pollution control down. To keep prices down, you must produce more energy.”

But John Baden, chairman of the Bozeman-based Foundation for Research on Economics and the Environment, warned against reading too much into the Mason-Dixon poll. “Montana voters are highly polarized on this issue,” Baden told Environment & Climate News. “Ironically, while we probably have the highest large sport utility vehicle and pickup truck ownership in the nation--and hence the lowest miles-per-gallon--I see strong support for prohibiting oil and gas drilling on the Rocky Mountain front.”

According to Mason-Dixon pollsters, 51 percent of registered Montana voters support increased resource recovery in the Rocky Mountains, while only 34 percent oppose it. The poll had a margin of error of +/- 4 percentage points.

Demand on the Rise

Rocky Mountain resource recovery is under federal scrutiny as the Bureau of Land Management (BLM) and U.S. Forest Service are examining the potential environmental impacts of increasing the amount of oil and gas production from Rocky Mountain locations. BLM has determined the Rocky Mountains contain a significant amount of recoverable oil and gas reserves that have yet to be tapped.

The Rocky Mountain energy reserves are important because of rising energy demand, particularly for natural gas. The Industrial Energy Consumers of America (IECA) reported in December 2003 that U.S. consumers paid $111 billion more for natural gas between June 2000 and October 2003 than they did for the same time-frame between 1997 and 2000. Even that figure does not tell the full story, reports IECA, because it does not reflect the resultant decline in manufacturing activity or the resultant increase in the price of consumer goods produced from natural gas.

IECA notes natural gas production remained constant during the past three years despite a sharp rise in demand. Although natural gas reserves are plentiful in the U.S., production restrictions supported by environmental activist groups have limited the ability of energy suppliers to meet market demand. As a result, natural gas is increasingly losing out to coal and other energy sources.

Environmental activist concerns over natural gas recovery are precluding further improvements in environmental air quality. Natural gas burns cleaner than coal or oil, which has spurred a recent trend toward generating more of the nation’s electricity from natural gas.

“Ironically,” commented PERC’s Stroup, “the increase in demand has been due in part to pressure from environmental groups. They want to reduce carbon dioxide, and natural gas produces less carbon dioxide per unit of energy production than do coal and oil.”

Since 1998, virtually all newly constructed power plants have been designed to run on natural gas. But the trend in favor of natural gas appears to be grinding to a halt, as constricted supplies and bureaucratic red tape preclude increased natural gas production. Environmental restrictions have rendered roughly 40 percent of American natural gas reserves off-limits to production.

Moreover, bureaucratic delays are making natural gas recovery less feasible even in areas that are not off-limits. Marc Smith, executive director of the Independent Association of Mountain States, reports that permitting applications to drill for oil and natural gas on federal lands in the Rocky Mountains took only 84 days to process in 2001, but more than twice as long--175 days--in 2002. Smith pinned most of the blame on “extreme environmentalists and anti-development groups.”

The result of these cross-purpose efforts is an intensifying, artificial shortage in natural gas supplies, leading to rapidly increasing prices. Consumer advocacy groups such as IECA note inflated prices make natural gas a less-desirable source of energy production. The most striking result of the artificial natural gas shortage is that power plants are switching back to coal and oil as a result of the steep increase in natural gas prices.

“Using natural gas to produce electric power increases the cost of natural gas and electricity for all consumers,” said IECA Executive Director Paul Cicio.

The IECA report comports with the U.S. Energy Information Administration’s (EIA) Annual Energy Outlook 2004. The EIA Outlook, released December 16, predicts natural gas prices will continue to climb in the next quarter-century, resulting in a heavier reliance on coal, oil, and nuclear energy. Stated Outlook 2004, “Although only a few years ago, natural gas was viewed as the fuel of choice for new generating plants, coal is now projected to play a more important role, particularly in the later years of the forecast.”

“Back in the 1980s,” noted Rob Bradley, president of the Houston, Texas-based Institute for Energy Research, “the Worldwatch Institute sold many environmentalists on the strategy of welcoming natural gas as the ‘bridge fuel’ to a ‘sustainable’ energy future. The American Gas Association and Interstate Natural Gas Association of America, both pressured by Enron, formed a gas-green alliance; the Natural Gas Supply Association did not. Today it looks like AGA and INGAA got snookered.”


James M. Taylor is managing editor of Environment & Climate News. His email address is taylor@heartland.org.

James M. Taylor, J.D.

James M. Taylor is managing editor of Environment & Climate News, a national monthly... (read full bio)