Starting Small
To get started, Roosevelt is seeking small quantities of CO2 for two years of test drilling beginning in 2014—and expects full production about two years later. He’s seeking financing to invest $300 million in six years. He says cash flow would fund subsequent investments, bringing the total cost to $2 billion. He expects a 50-fold return on equity for Roosevelt Resources LLC, which employs sons Elliott III, 50, and David, 43.
Roosevelt isn’t stopping there. He’s considering a sixfold expansion of his 38-square-mile area and is scouting further in west Texas, declining to say where.
“The key is getting CO2,” he says.
While Roosevelt assembles the pieces he says will dislodge hundreds of millions of barrels of residual oil, the U.S. is rising as a fossil-fuel powerhouse—angering Obama backers who want action on clean energy.
On March 1, the State Department said the proposed Keystone XL pipeline for hauling Alberta, Canada’s tar sands oil wouldn’t hurt the environment, even though the crude releases 17% more greenhouse gas than typical U.S. oil. If the pipeline stalls, producers have other options to reach the market, so the environmental impact won’t change, the department says.
In other disappointments for environmentalists, Obama’s cap-and-trade plan to limit CO2 died in the Senate in 2010. The EIA expects energy-related CO2 emissions to drop 9% from 2005 levels by 2020. Four years ago, Obama pledged a 17% decline in greenhouse gases by then.
“President Obama needs to match his soaring oratory with climate action,” Michael Brune, executive director of the San Francisco-based Sierra Club said after the Keystone announcement.
As the U.S. fracks, drills and pumps its way toward fossil-fuel independence, the planet’s rate of temperature increase is accelerating, according to the March 7 Harvard and Oregon State study.
“This is another wake-up call,” says Frances Beinecke, president of the New York-based Natural Resources Defense Council. “We must cut carbon pollution.”