The other reason for America's abundant supply of oil and natural gas has been the development of new drilling techniques. "Horizontal drilling" allows rigs to reach two miles into the ground and then spread horizontally by thousands of feet. Mr. Hamm was one of the pioneers of this method in the 1990s, and it has done for the oil industry what hydraulic fracturing has done for natural gas drilling in places like the Marcellus Shale in the Northeast. Both innovations have unlocked decades worth of new sources of domestic fossil fuels that previously couldn't be extracted at affordable cost.
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When it was Mr. Hamm's turn to talk briefly with President Obama, "I told him of the revolution in the oil and gas industry and how we have the capacity to produce enough oil to enable America to replace OPEC. I wanted to make sure he knew about this."

The president's reaction? "He turned to me and said, 'Oil and gas will be important for the next few years. But we need to go on to green and alternative energy. [Energy] Secretary [Steven] Chu has assured me that within five years, we can have a battery developed that will make a car with the equivalent of 130 miles per gallon.'" Mr. Hamm holds his head in his hands and says, "Even if you believed that, why would you want to stop oil and gas development? It was pretty disappointing."

Washington keeps "sticking a regulatory boot at our necks and then turns around and asks: 'Why aren't you creating more jobs,'" he says. He roils at the Interior Department delays of months and sometimes years to get permits for drilling. "These delays kill projects," he says. Even the Securities and Exchange Commission is now tightening the screws on the oil industry, requiring companies like Continental to report their production and federal royalties on thousands of individual leases under the Sarbanes-Oxley accounting rules. "I could go to jail because a local operator misreported the production in the field," he says.

The White House proposal to raise $40 billion of taxes on oil and gas—by excluding those industries from credits that go to all domestic manufacturers—is also a major hindrance to exploration and drilling. "That just stops the drilling," Mr. Hamm believes. "I've seen these things come about before, like [Jimmy] Carter's windfall profits tax." He says America's rig count on active wells went from 4,500 to less than 55 in a matter of months. "That was a dumb idea. Thank God, Reagan got rid of that."

A few months ago the Obama Justice Department brought charges against Continental and six other oil companies in North Dakota for causing the death of 28 migratory birds, in violation of the Migratory Bird Act. Continental's crime was killing one bird "the size of a sparrow" in its oil pits. The charges carry criminal penalties of up to six months in jail. "It's not even a rare bird. There're jillions of them," he explains. He says that "people in North Dakota are really outraged by these legal actions," which he views as "completely discriminatory" because the feds have rarely if ever prosecuted the Obama administration's beloved wind industry, which kills hundreds of thousands of birds each year.

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Mr. Hamm calculates that if Washington would allow more drilling permits for oil and natural gas on federal lands and federal waters, "I truly believe the federal government could over time raise $18 trillion in royalties." That's more than the U.S. national debt, I say. He smiles.

Archduke Russell John wrote:I don't know if I would go with a blank tax NFP's. Not all NFP's are the size of Harvard. Some are rather small and barely get by. Any taxation would be onerous. For example, I am on the Board of Directors of a group called Council Rock Coalition for Healthy Youth. It lives off of donations and government grants. If it was taxed, it would be out of business.

geojanes wrote:Come on Ray. That "article" is a great example of what's wrong with the Journal, yes it is just an interview, but there is no attempt to check out anything that this guy says: killing one bird (or is it 28?) What's the story behind that? $18 Trillion in royalties? More than the national debt? Are you kidding me? In the article they speculate that it might be wrong but if it's wrong even by half, that's pretty good. That is NOT journalism. That is poor blogging. The Journal's business news is still OK, but when it comes to opinion or when they give their pages to an oil man to give his opinion . . . is it true? Who knows?

That said, sure, more oil and gas produced domestically would be great: employ people, cut the account deficit, not enrich a bunch of goons in oil rich nations. But is the gov't really the problem here? I'm HIGHLY skeptical and the interview published in the WSJ does nothing to address that skepticism. Sounds more like the power of magical thinking.

Interviews are supposed to be in the interviewee's words so I don't think a slam of the WSJ makes sense here. He's the CEO of a $8 billion company that he founded 35 years ago. We all agree that some of what he says is inaccurate, but let's not throw the baby out with the bath water.

I'm under the impression that there are huge restrictions in the US for oil drilling, particularly in Alaska. Whether or not those restrictions make sense, are you saying that the US Gov't is not preventing more domestic oil and gas production? I didn't think that was in dispute.

The wsj is now a Murdoch newspaper Ray. haven't you noticed the difference?

Ray Jay wrote:I think the phrase "short term economic problems" is problematic.

geojanes wrote:

Ray Jay wrote:I think the phrase "short term economic problems" is problematic.

Sorry, I thought that was your point. It was never mine. I agree with you that the longer-term is very important, more than short-term impacts. The reason I think I was confused is that you were saying that Obama is "one note". Not sure where that comes from. I don't follow it too closely, but I know there is the goal of doubling exports, lowering foreign energy dependence, reforming the SEC, trade agreements, and finally doing something about health care, which criticize the details of the current plan you will, it's at least a change from our current completely farkocktah system.

Ray Jay wrote:well if you are going to use Yiddish I'll have to respond ... I would think it is pronounced more like verkaktah.