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IN THE RECENTLY RELEASED FILM PROMISED LAND, MATT
DAMON plays a smooth-talking salesman for a natural-gas
company who plays down concerns about the environmental impact
of hydraulic fracturing, or fracking, to buy cheap drilling
rights from farmers in a depressed area of Pennsylvania.
Damons character sours on his job when he discovers the
actions the company is willing to take to win, but he never
really turns against fracking, as the potential bonanza of
natural gas may offer the last chance of economic revival for
this rural area.
Off the silver screen that message is resounding more than
ever. Fracking has reinvigorated the U.S. oil and gas industry
and brought the nations economy to the cusp of a historic
transformation. The drilling technique is extracting massive
new supplies of natural gas and sizable amounts of oil from
shale rock formations, also known as plays, from Pennsylvania
to North Dakota. Energy imports have declined so much over the
past six years that the idea of U.S. energy independence
a pipe dream of presidents since the days of Richard Nixon
is suddenly a distinct possibility. The gas revolution
also has the potential to spark a broader economic surge,
creating millions of jobs and lighting a fuse under U.S.
Cheap, abundant energy generated by fracking will bring a
new American century, contends Philip Verleger, an
economist and former director of the U.S. Treasurys
Office of Energy Policy who runs his own energy and commodity
consulting firm. He predicts that the U.S. energy boom will
create 3 million jobs and boost economic growth by 1 to
1.5 percentage points a year between now and 2020.
We can clean the clock of competitors who dont
have access to natural gas, and that overrides cheap labor
abroad, says Verleger, who served in the Carter
administration. Our trade deficit may go way down;
well have lower-cost energy; the Fed wont have to
tighten monetary policy; the dollar will be more competitive.
And itll work no matter who is president. We will be
energy independent in ten years.
Verlegers prediction is certainly ambitious, but there
are several obstacles on the path to potential independence.
First, the fracking industry must overcome its critics and
demonstrate that it can continue to ramp up production without
causing serious environmental damage. New York State, home to a
potent antifracking movement, has imposed a moratorium on the
practice pending review of an environmental study; Governor
Andrew Cuomo is expected to decide by late this month whether
to allow drilling to proceed. Scores of local governments
across the country have banned it. Environmental concerns
can influence policymakers and can lead to lower
investments and slow things down when were trying to
generate energy and create jobs, says John Felmy, chief
economist at the American Petroleum Institute, a
Washington-based trade organization. There are legitimate
issues that have to be properly addressed, especially when
fracking is often misrepresented.