Politics is Playing a Major Role in the Shale Drilling Industry

by S. Tom Bond on September 15, 2012

PA Oil & Gas Industry Billboards

This commentary is by S. Tom Bond of Jane Lew, WV

Recently an acquaintance was in a car dealer’s showroom waiting for repairs. Four “rough looking” young men came in she said, and made it known to all they were there for three identical large pickups. Obviously, they were with the Marcellus industry.

This brought up a line of thinking I’ve been on lately. Why do the companies go to small dealers? Obviously they can make a better deal by buying any item in bulk from one dealer.

Look at all the names on the trucks that carry water and brine – quite literally enough to fill a page with the different names. Same diversity with sand trucks, environmental companies and all the rest. Why? I think the dis-economy of such diversity is compensated by the political power generated diversifying these functions. Each owner and his employees and their friends will support the drilling industry, and this is more important than the savings forgone by loss of economy of scale.

All corporations without exception must have enabling legislation. Individuals can do business, small shops and manufacturers can do business, professionals can organize their support without legal structure beyond common law; but corporations must have a body of law to shape interaction with outside bodies and individuals. They maintain lobbyists in all legislatures and in Washington, as do other groups, often to counter the corporations.

Politics is especially important to the shale drilling industry. The laws that allow them to proceed involve land, technology, interaction with the environment, also with the numerous accidents and with conditioning and distribution of their product. It also involves public health, degradation of the assets of other industries like farming and recreation and interference with hunting and fishing as well as other areas of concern to other members of the public with whom they come in contact. Battalions of lobbyists are required to allow them to proceed against these other interests.

The shale drilling industry cannot negotiate all these interferences with all interested parties for each well. The shale drilling industry absolutely must have the coercive force of government to back them up when dealing with other parties. They must have the right laws to do that. Thus they need politics.

This need for political power also is the explanation for all the other ways they cultivate it. Consider the public meetings the industry puts on and public meetings others, such as the University Extension Service, put on at their expense. The seemingly endless advertising along highways, including new ads along the Pennsylvania Turnpike which describe critics as “green slime,” advertising in newspapers and magazines and on the internet is directed at the same end. Some of it sounds like “public service” advertisements, some like solicitation for investment, but it all serves to encourage the public to bend to their political needs.

The big bash known as “Shale Gas Insight” to be put on in Philadelphia September 20-21 Is entirely unprecedented. It is costing millions and featuring top executives of several corporations and arch-enabler Pennsylvania Gov. Tom Corbett, who even wants to ham-string doctors and reduce the wind generated electrical industry to advance his shale drilling backers.

Boosterism isn’t entirely new to today’s gas industry. Years ago the industry cultivated opinion leaders: Chamber of Commerce types, some church leaders, leaders in education, and others who might influence the public. What is new is going directly to the public, as well as the leaders. Also new is spending a significant part of the investor’s money on public relations.

This is necessary because of much greater damage where they now operate, and the inconvenience they cause to so many people. Where ever shale drilling goes, opposition arises from these complaints.

The public is much more sophisticated in its understanding of environmental concerns, too. One hundred years ago salt water could be directed down the hillside without concern and oil on the creek was not a worry.

Now everyone knows about the coming population expansion and the exhaustion of resources, and although many people do not much concern themselves about it, others are more forward-looking. Global warming is now widely accepted, except among those who are paid to deny it, and burning carbon for energy is seen to be a root problem to continuing life as it is on earth. For the fossil fuel industry, it is important to represent burning carbon as the practical way to get energy, and importantly, to soak up capital that might be used in other energy directions.

The position of the carbon energy business is now seen to be far from glamorous. Rather, it is at best dirty and dangerous, but necessary. It has been wary of successors for forty years, nuclear, solar and wind power, and now with so much against it, as the end time for carbon burning approaches, every effort must be made to prolong the period of its greatness. Politics, with the enabling coercive force of the state, is more important than ever.

As always, economics is a major determinant in the choice of an energy source, but now that we are on the edge of technologic change, and when we need decarbonization because of global warming, political power is used to sustain the carbon industry.

>>> S. Tom Bond is farming some 500 acres in Lewis County. He is a former chemistry teacher and has been active in the Guardians of the West Fork and the Monongahela Area Watersheds Compact <<<

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