Don’t Believe This Fake News About America’s Government Owned Oil And Gas Resources

Zoltan Istvan, a Libertarian candidate for governor of California, claimed in a podcast on The Stark Truth that the federal government owns lands worth “around 150 trillion dollars.” Listening to it I almost instantly knew it was BS. With America’s total GDP being around 18 trillion dollars, that would be lands worth an equivalent of all the goods and services produced in the United States for around 8 years. It was clear that Istvan wasn’t talking about schools, courthouses, roads, or prisons, rather, this was “unused” land containing natural resources he proposed to sell or lease and use to pay for a basic income.

I traced the apparent source for the claim to an article Istvan wrote claiming the federal government owns at least 130 trillion dollars of natural resources, it’s source for this is a Time Magazine article, claiming the U.S. has oil and gas resources worth 128 trillion dollars. Presumably the rest of the 150 trillion comes from state owned land or other resources, but I’ll just address here the 128 trillion number since it’s where the lion’s share of the claim comes from. The Time Article links to a report by the Institute for Energy Research, which claims to have estimated the figure itself. The Institute for Energy Research has often been described as an oil industry front group. The claim was then repeated by, among others, Business Insider, Breitbart, and Market Watch.

A rough calculation suffices to prove the number wrong. Cherry pick Wikipedia’s highest cited estimate of America’s total oil reserves, 55 billion barrels of oil. At the generous price of 100$ a barrel, that’s 5.5 trillion dollars. Doing the same for natural gas resources, you have 2,335 trillion cubic feet of recoverable natural gas multiplied by .004 dollars per cubic foot of gas and you get 9.42 trillion dollars. And that’s all the resources, whereas the report appears to refer only to lands owned by the federal government. The exact phrase used is simply “the government” but the article is entitled “Federal Assets Above and Below Ground.”

In the report and the Time article, it’s unclear if the figure is referring to the value of the oil when sold or the market value of extraction rights to the land itself, which would be much less as the oil isn’t going to extract and transport itself. The report makes a direct comparison of the figure to the national debt, but that’s the kind of “hey it’s not technically a lie” deception that I’d expect from a political advocacy organization rather than a direct invention of a figure as appeared to have occurred here. But once Istvan is talking about it, it’s clear that he believes the market value of extraction rights must be that high. It’s like a rumor which becomes more ridiculous with each person who repeats it.

Just remember, if something sounds too good to be true, it’s probably because it’s not true.

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2 Responses to Don’t Believe This Fake News About America’s Government Owned Oil And Gas Resources

  1. There are a lot more resources out there than just oil and gas. In California, there’s land, sweet ocean view land worth trillions, ready to be developed if only the coastal commission would get out of the way .There are fisheries. There is forestry. There are minerals. There are recreation areas. There is dirt and safe space in a democratic country, which is worth a lot to foreign billionaires. There’s plenty of other things too. Some people put the estimates closer to 250 trillion overall, though I stick with the lower numbers to be conservative. Also, naturally a lot of this is dependent on valuation of commodities at the time and how one would go about selling it. Thanks.

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