The precipitous drop in oil prices creates a huge, once-in-a-lifetime opportunity for every person or group that is fighting the energy industry over environmental issues. Before I reveal what that opportunity is, let me tell you that I followed and researched energy companies, primarily in North America, for almost two decades in my past job as a portfolio manager. Thus I witnessed firsthand the growth of what some people call the shale ‘revolution’. As a focused area of investment, my angle was to always be on the lookout for any disaster that could halt this growth, and the supposed profitability of shale. In doing so, I never encountered an environmental ‘smoking-gun’ that was so alarming that it could be used to sway public opinion, say in the manner of a nuclear meltdown. Nevertheless, I was certainly aware of all the less-than-catastrophic destruction going on.
I was also amused watching the environmental and political fight over the XL pipeline last year. Once again there really wasn’t a smoking-gun that could get anyone but those already in the environmental camp energized, plus a few farmers in a remote part of the country. Several months ago I read how the real aim behind the fight to stop the pipeline was Tom Steyer’s desire to halt the importation and use of heavy oil from Canada, and the extraction and processing business in Western Canada as a whole. That sounds admirable, and he and others threw a lot of money and passion into it. But in my mind what I really think killed it were the economics: between competing pipeline alternatives and logistical oil gluts, the companies pushing for it stopped pushing so hard once their profit motive turned worse.
I don’t mean to pooh-pooh in anyway the efforts of those fighting fracking and climate change, I just think it’s an uphill battle against those with greater resources and a profit motive, namely the energy companies, and the understandable unwillingness of citizens to care about the long-term consequences of that which they cannot see as they try to get on with their daily lives. Throw in the argument that shale drilling keeps a lid on energy prices, true, and your job becomes almost insurmountable.
Fortunately, from the excesses of capitalism, comes the huge opportunity to which I alluded. Because with gas prices way below $3 a gallon, now is the time for Continue reading