US too renewable-focused, should drop natgas barriers - Conoco

09 March 2010 22:18  [Source: ICIS news]

HOUSTON (ICIS news)--The US government is unrealistic in its insistence on using renewable energy sources and should remove barriers that restrict the usage of domestic natural gas supplies, the chief executive of US energy major ConocoPhillips said on Tuesday.

“It is clear from experts that carbon-based fuels, though in cleaner forms, must keep carrying the load,” chief executive James Mulva said.

“Renewables just cannot ramp up fast enough to replace them,” he added.

Mulva delivered his keynote address, which centred on natural gas, at the at the CERAWeek 2010 energy conference in Houston.

The US chemicals industry relies heavily on natural gas as a petrochemical feedstock and power fuel.

Mulva said natural gas in North American shale formations was abundant and a “gift” to the energy industry, but that the US government “unfortunately proposes higher taxes on the natural gas industry and is tightening resource access”.

“Perhaps we haven’t learned that if you tax something, you get less of it,” Mulva said. “The shale gas revolution here occurred on private and state land, not federal land.”

Mulva noted that part of the initial rationale for emphasising renewable energy was that fossil fuels were allegedly running out. However, recent studies showing there are abundant natural gas reserves have challenged that concept, he said.

Alternative energy sources also pose environmental concerns, Mulva said.

For example, the wind and solar power industry has problems with cost, reliability, visual impact and excessive land and water use. Likewise, the biofuels industry requires much land and water, can impact food prices, can increase greenhouse gas (GHG) emissions and requires subsidies, Mulva noted.

Additionally, the coal industry remains “quite carbon-intensive,” he said.

On the other hand, natural gas requires a small land-use footprint, low water consumption, and while it is carbon-based, it burns cleanly and produces practically no nitrogen oxide, sulphur dioxide or particulates.

Also, in terms of climate change, gas-fired power plants produce only half the carbon dioxide of coal-fired units, Mulva said.

“Substituting gas for other fuels is the fastest and most cost-effective way to reduce greenhouse gas emissions,” Mulva said.

Mulva repeatedly referred to those against natural gas usage as “hydrocarbon deniers”, adding that his vision was the “real future, not pipe dreams”.

“Shale gas gained through repeatable long-term programmes raises efficiency, lowers costs, and leads to lower prices for consumers,” Mulva said.

The CERAWeek conference lasts through Friday.

To discuss issues facing the chemical industry go to ICIS connect


By: Ben DuBose
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