ARGONNE NATIONAL LABORATORY, Illinois—President Barack Obama today announced a new deal for fossil fuels. But the place he chose to make it spoke the loudest. It was not an oilfield, but the country’s premier center for the study of advanced batteries.
Speaking at this forested lab 25 miles south of Chicago, Obama celebrated a US shale gas and oil boom, which in just a few years has reversed a plunge in US fossil fuel production, and replaced it with a gas surplus and the lowest oil imports in years. But the thrust of his message was in line with his position since becoming president: that the United States needs to work toward a future of clean fuel technologies.
Obama urged Congress to channel $2 billion in federal oil and gas royalties into an “Energy Security Trust“ that would fund the development of more efficient engines, better biofuels and more powerful advanced batteries. “The only way to achieve real energy security is to shift our vehicles” off of oil, Obama said. The US should continue to produce oil and gas, he said, but also “make sure we are making the right choices” by planning for a cleaner future.
The symbolism of making these remarks at Argonne, a federally funded lab managed by the University of Chicago, cannot have been lost on the energy industry. The lab recently won a $125 million federal competition to host a joint government-industry Innovation Hub, where scientists will try to make a fundamental breakthrough in battery science. On a tour of the lab, Obama greeted the two young scientists chosen to brief him on Argonne’s battery program with, “Are these the hotshots you were telling me about?” In his speech, he also singled out the work of Michael Thackeray, one of the lab’s senior scientists, whose patented advances are part of the battery that operates the Chevy Volt.
In all this, Obama was practically inviting opposition. Republicans, along with oil companies, have advocated the right to drill offshore from the US East Coast, and onshore and offshore in Alaska. The president said in his speech that he was encouraging more oil and gas production, but made clear that he did not plan to open up more federal land for drilling. Instead, he suggested that his administration would try to nudge companies into drilling more efficiently within their current leases.
Republicans and the oil lobby, however, are likely to push for more drilling rights in exchange for agreeing to the Energy Security Trust. In a statement after Obama spoke, the Independent Petroleum Association urged him to open up eastern sections of the Gulf of Mexico to drilling. “If the President wants to garner more federal revenue,” the association said, “opening up federal lands and waters is the best way to do so.” It also urged him to approve the export of US liquefied natural gas; that, of course, would increase demand and prices for the gas, thus making the case for even more drilling.