Don’t Panic, Elon! The World Already Has Plenty Of Oil & Gas

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The high profile US entrepreneur Elon Musk has joined the chorus of voices calling for oil and gas producers to ramp up production as the Russian invasion of Ukraine steamrolls towards a third murderous week. That’s a bit of an odd take for someone whose fortune is embedded in clean technology. It also distracts from the broader resource issues underlying Russia’s unprovoked, violent attack on one of the leading breadbasket regions of the global economy.

At this writing, Russia seems intent on murdering as many people in Ukraine as it can. Millions are fleeing and in need of assistance. To help refugees from that conflict and others, contact to the United Nations Refugee Agency or other reliable aid organizations.

The World Has Plenty Of Oil & Gas

On its face, the call for more oil and gas production is a logical one. Russia plays a significant role in the global oil and gas supply. Its share of the global fossil energy business has already nosedived on the heels of its corrupt, homicidal rampage through Ukraine, even though so far the international community has refrained from direct sanctions on Russia’s energy sector. It would seem reasonable to replace the “lost” supply as quickly as possible.

One key car of that logic train is missing, though. Producing more oil and gas is one thing. Getting it to market is another thing entirely. The global network of shipping lanes, seaports, railways, highways, pipelines, terminals, refineries and storage facilities will require more than a few tweaks to accommodate a massive shift in oil and gas sourcing, and that will take time.

If the whole world really is on a war footing and “extraordinary measures” are required, as Team Oil and Gas suggests, then an all-hands-on-deck effort to rally the public around energy conservation and energy efficiency will accomplish the same goal, much more quickly — that is, if the goal is to avoid near-term fuel shortages and price spikes rather than simply to sell more fuel at higher prices.

Oil & Gas Vs. Renewable Energy

Another angle on the global energy supply issue is the increasingly swift pace of renewable energy development. Renewables are not going to counterbalance a Russia-fueled global energy crisis in the near future. However, in consideration of the latest IPCC climate report, clearly the financial resources of the world would be put to better use on conservation, energy efficiency, and renewable energy development rather than scrambling to replace Russian oil and gas with other oil and gas from somewhere else.

In that context, Russia’s failure to pivot into renewable energy is a stark contrast with other leading fossil energy producers.

The US, for example, is beginning to tap its vast geothermal resources and offshore wind potential, and that activity is not limited to domestic energy supply. The emerging green hydrogen field will enable the US to steer some of that renewable energy into the global hydrogen and ammonia markets. At least three different green hydrogen “hubs” are already in the planning stages in the US, including one in the iconic oil and gas state of Texas.

It’s Not Just About Fossil Energy

Green hydrogen hubs are also percolating elsewhere around the globe including Europe and Chile, leading to the prospect that oil and gas from Russia will eventually play a bit part, if any, in global energy markets.

However, the broader issue is one of resource control, and geopolitical analysts are warning that energy is just one element in Russia’s catastrophic land grab.

Last week, Carnegie Europe published an interview conducted by visiting scholar Olivia Lazard with IPCC co-lead author François Gemenne, in which the conversation revolved around food supply in addition to global warming and energy issues related to the Russian invasion of Ukraine.

Energy observers have surmised that Russia has been eyeing Ukraine’s fossil energy resources, but Lazard pointed out that Ukraine also plays a lead role in global food markets.

“We’ve heard Putin say that he intends to have Russia benefit from the climate crisis by opening up new trade routes, new agricultural lands, and being a breadbasket powerhouse for the global economy in the future,” she said. “Putin is trying to hoard agricultural lands for Russia’s food security, thereby also increasing the world’s future dependence on Russia in agricultural markets.”

“In 2021, the European Union struck a partnership with Ukraine on supply chains for critical materials that are necessary for decarbonization and for digitalization,” Lazard also emphasized, “So Russia’s invasion of Ukraine can be seen as an attempt to hoard mineral resources in addition to agricultural ones by gaining access to mineral resources outside of its territory.”

Meanwhile, Back In Texas

Turning now to the Lone Star State, it’s no surprise to see that plans are under way to establish a green hydrogen hub there. In addition to massive wind and solar resources, the state can call its extensive energy infrastructure into play for hydrogen transportation, including shipping ports for the global market.

The “Hydrogen City, Texas” developer Green Hydrogen International anticipates commercial production within the next couple of years, but the global market for green hydrogen is tiny compared to the fossil energy market. The Texas oil and gas industry will keep humming along for the foreseable future.

With that in mind, it is not a shock to learn that Elon Musk’s SpaceX company launched plans to drill for natural gas in Texas last year. Among the innovations introduced by SpaceX is the use of methane as a propellant, instead of liquid hydrogen fuel. With gas prices spiking, it would seem only natural for SpaceX to insulate itself against prices shocks and supply issues by drilling for its own gas.

“Production has yet to start because of a legal dispute between the SpaceX subsidiary Lone Star Mineral Development and another energy company,” our friends over at World Oil reported back in January of 2021. “Tim George, an attorney representing Lone Star, said…that SpaceX plans to use the methane it extracts from the ground in connection with their rocket facility operations.'”

If that project falls through there’s always landfill gas. Or, some day SpaceX could make its own methane from green hydrogen and captured carbon dioxide.

For now, though, natural gas would most likely be the handiest source of methane for SpaceX.

Still, cheerleading for oil and gas still seems a strange choice for a clean tech entrepreneur, although it is of a piece with recent behavior.

Cheering for the blockade of Canada’s capital city (a NATO member, btw) and publicly insulting the President of the US (another NATO member, coincidentally or not) in the weeks leading up to Russia’s invasion are other examples capably outlined in a post by CleanTechnica’s own last month. If you have any thoughts about that, drop us a note in the comment thread.

Follow me on Twitter @TinaMCasey.

Image: The University of Texas held a green hydrogen conference last year (image via University of Texas).

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Tina Casey

Tina specializes in advanced energy technology, military sustainability, emerging materials, biofuels, ESG and related policy and political matters. Views expressed are her own. Follow her on LinkedIn, Threads, or Bluesky.

Tina Casey has 3234 posts and counting. See all posts by Tina Casey