California’s reputation as a state where success has a shot has long placed us at the forefront of innovation and prosperity. Whether it was the promise of the Gold Rush, hopes to land on the silver screen, or securing a job in the agriculture or technology sectors to earn an honest living, California has served as a fresh start for many. Today, an energy revolution that is taking root throughout the country can be California’s next great moment.
The opportunity lies in a decades-old technique of extracting oil and gas safely from geologic formations deep underground, known as hydraulic fracturing. But innovation has led this practice to new heights that now allow drillers to access vast amounts of resources that had long been considered inaccessible.
This production technique is the driving force behind the United States’ anticipated ascent as the world’s largest oil and gas producer by the end of this year. And just last week, the International Energy Agency reported that in two years the United States will surpass Saudi Arabia as the top oil producer in the world. In fact, for nine straight months the United States has outproduced Saudi Arabia in petroleum. America is now leading in an industry that many thought would be forever outsourced to the Middle East.
We are in this position today because entrepreneurs and innovators, not government programs or mandates, have taken risks against the odds through their own investments to discover and produce American energy resources. And these entrepreneurs have found a warm embrace from states looking to boost their economies and grow good-paying jobs for their residents.
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States such as North Dakota, Pennsylvania and Colorado have all identified the wealth that energy resources can provide their communities and have enacted meaningful and responsible regulations for their development. Because these states understand their geological makeup and have an inherently greater interest in protecting their environment than the federal government, it is no surprise that energy development has been far more efficient within the jurisdiction of states than Washington, D.C.
Today, the U.S. House of Representatives will move to build on the success of states and remove the cloud of uncertainty of the federal government instituting duplicative hydraulic fracturing regulations in states where the activity is already taking place.
Just last month, California joined the ranks of pro-growth states passing legislation to regulate hydraulic fracturing. This places greater emphasis on the Golden State to get it right. Since Gov. Jerry Brown signed the bill into law, I have led my California colleagues in an ongoing conversation with the governor to ensure any final regulations receive input from all stakeholders involved so that California can stand to benefit from hydraulic fracturing. Here’s why:
The Monterey shale is projected to hold greater potential for oil than any other shale play in the country – more than 15 billion barrels or 64 percent of total undeveloped but recoverable shale oil, according to a 2011 International Energy Agency report. To put this into perspective, this is five times more than the amount of oil in North Dakota, where the unemployment rate is the lowest in the country. As our state, particularly the Central Valley region, grapples with high unemployment and few new job opportunities, the potential for prosperity in an industry that is well established in California cannot be ignored.
Despite the rhetoric and expensive TV advertisements that are long on exaggeration but short on facts, hydraulic fracturing has been demonstrated to be safe. In fact, California’s own director of the Department of Conservation, Mark Nechodom, stated in a recent interview that hydraulic fracturing has been used for the last 40 years and there has not been one record of reported damage.
The Central Valley has a long-standing and successful track record producing energy resources in California. It is the work that many of our communities rely on, and it is the industry that powers our economy. Because of technology that continues to advance from places like Silicon Valley, our communities can look forward to prosperous times for decades to come. Our state can look forward to reduced unemployment, budget surpluses and, who knows, maybe even lower taxes. But we can do this only if we embrace the entrepreneurial spirit that first put California on the map more than a century ago.