|Thanks Big Oil!|
Immediately thereafter, the BNSF flexed its corporate might and bullied the community leaders of this town into allowing the expansion of the rail line into two lines to improve rail car throughput. Concessions were made, improved safety was promised, improved infrastructure granted, and at the end of the day, a rail road cash gift of $800k given to the community. In exchange? The BNSF was allowed to tear down 3 acres of public park land (to accommodate the loss on real estate of a public golf course), to fill in 7 acres of wildlife wetland, and increase the amount of rail traffic through town to accommodate much needed Great Plain Bakken crude oil for distribution. BNSF = +1, Big Oil : +1, Community : -1. Hopefully that BNSF analyst received a fantastic holiday bonus....
So, to revisit the question above : Is OPEC going to save the North America and the World? Yes, OPEC is going to save it all.
Everyone has heard of OPEC or the Organization of the Petroleum Exporting Countries; the Middle Eastern Carte/Collusion/Coop/Organization that produces and exports nearly 50% of the world's crude oil oil. Good fortune billionaires, terrorists, Western funded puppets,...you name it, OPEC is it. And no one typically cares about OPEC unless the cost of fuel at the pump puts a damper on one's wallet.
So how is OPEC saving the world? Great question : let's start with a look at Crude Oil Prices over the past 10 years.
Look at that wonderful crash over 2014; nearly 50% loss since Jan 1st 2014. A lot speculation to oil price's decline includes a global economic slowdown, increased alternative energy sources, better fuel efficient transportation, and excess supply existing in the Middle East due to lower US demand due to internal crude production. I personally believe that the reason for lower oil prices is that OPEC is flooding the market with crude oil to combat North American fracking supply. Is this a "conspiracy theory" belief? Nonsense; this is pure and simple capitalism, and OPEC is simply doing what any other for profit monopoly would do if faced with legitimate competition that hurts the bottom line. Run the competition into the ground and then jack oil prices up when the competition disappears.
So how is OPEC flooding the market with crude (increasing supply), therein driving price down, and in effect, saving the world? How is sub $60, even sub $50 crude oil saving the world? That, dear readers, lies with cost related to produce fractured crude oil..but before looking at the economics of the situation, let's first define the process and potential consequences.
Fracturing crude oil is most certainly no stranger to controversy. Sadly, most of us likely don't even know what it is or what it does outside of giving us cheaper gasoline at the service stations. Regardless of what side of the fence you sit on regarding fracking, the process itself is an engineering truth. Oil companies drive millions of gallons of water and toxic chemicals deep into the earth into gas pipelines in an attempt to generate high pressure fluid that cracks shale rock and allows fossil fuels to be released into the well. This allows for the capture of the fossil fuel for further processing; once the well is dried up, 30-50% of the water/chemicals is left in the ground, and another well site is found and processed.
I'm no engineer, scientist, tree hugger, or left leaning radical; however, I do have common sense, and the risks attached to frack mining are rational facts. Excessive water consumption, potential aquifer contamination, potential drinking water contamination, and negative air emissions required by frack mining are a given. In addition to environmental concerns, plenty of evidence suggests that fracking operations may lead to negative worker health; evidence also dictates that the transportation of fracked oil leads to negative rail road transportation outcomes (ie explosions in neighborhoods due to rail car accidents and contaminated grounds due to spilled cars). Lots of oil companies and rail road companies claim that the risks are always addressed and managed, but let's be honest, humans always fuck things up. If there is a catastrophe at play, either environmentally or with the population at risk, and humans are on hand to manage the risks, you can bet that the opportunity for catastrophe is always present.
Despite not being any of the above mentioned professions or activists, what I do know is how economics work. I've read online that at any point that the market price of crude drops below $70, $60 and $50 a barrel, the economic cost to produce fractured crude oil becomes unprofitable. The majority of CEOs and CFOs I've worked for don't give a shit about worker safety or the environment; worker safety and environmental concern costs money. Fortunately, these same CEOs and CFOs do care about profits, and should the cost to frack oil exceed the price they can supply it, they will shut it down to make their shareholders happy.
Already word is being reported that a number of fracking operations in the Plains are beginning to be mothballed. If oil prices continue to fall, how many more operations will cease? How many more mines will be closed down? How many more rail line expansions will no longer be needed? And if OPEC continues to flood the market with oil, maybe, just maybe, will the startup cost to reopen and mine in the Great Plains be too expensive versus an alternative option in the future? I do hope so...
So, let OPEC rain oil down into the global community. Let the price of oil drop below $50 / barrel for an extended period of time. It's too late for the community that I live near; the damage is already done. Long term, however, how many other communities, people, and wild life preserves will be saved by the death of frack mining operations? I would garner a guess that the answer to that question is significant in terms of human and earth damage. Not everyone lives in a state like New York where community appointed leaders look out for the safety of their constituents and ban frack mining operations. So for all those who have no voice in their government, let's let OPEC and the market do its thing.