NMI Interview: Pearce sticks to his guns on energy, aims at Udall

The millionaire Hobbs oilman and Senate hopeful thinks he’s right on the race’s hottest issue.

ALBUQUERQUE – Late last week, Steve Pearce sat down with NMI for an in-depth, wide-ranging interview on energy issues.

 

The backdrop for the interview is the bare-knuckled contest pitting Pearce against fellow U.S. Rep. Tom Udall, his Democratic opponent for the open Senate seat being vacated by Sen. Pete Domenici. Lately, it’s a contest seemingly overtaken by insults. Udall, for example, charges that Pearce is “completely out of touch on energy” and “a mouthpiece for big oil.” Pearce, in turn, has countered that Udall is connected at the hip with “hysterical left-wing environmental allies.”

 

But with NMI, Pearce touted his decades of experience in the oil business and calmly made his best case for more domestic drilling, more nuclear energy development, even a few nods to encouraging renewable sources of energy.

 

Pearce, the former owner of the oilfield services firm Lea Fishing Tools, undeniably knows the money-making side of this equation. Nor is he afraid to promote it – including to this reporter: “You could be down in the oil field making a good living and I'll tell you how to do it,” Pearce said at one point with a chuckle.

 

But he’s deadly serious about what he sees as the answer to America’s present energy woes: “Drill in Alaska, drill off the coast, take the royalties and put it into accelerated development of the renewables: hydrogen, nuclear, wind, solar, geothermal and biomass. Those six kinds of renewables,” Pearce explained, seated in a comfy leather chair in front of a highly polished conference room table. “We need energy from everywhere in the future.”

 

He periodically thumped the table with his hands to drive his points home.

 

Pearce was just as forceful in his defense of the oil industry in a recent story published by the LA Times. In the late July story, he stated that oilmen like him should be “telling us what to do” on energy.

 

The full quote: "At a time when we're facing $4 gasoline, I think that you need people who've been in the energy industry to tell us what to do," Pearce said.

In the interview with NMI, however, Pearce appeared to back away a bit from that particular quote.

 

“I said I think we should have people from the industry -- that's me -- sitting at the table because people don't know what it takes to make oil and gas,” Pearce attempted to clarify. “If we’re going to deal with health care, wouldn't we want a doctor or two?"

 

NMI: But didn’t you say industry should “tell us what to do,” not just have a seat at the table?

SP: "That was not what I said. What I said is that it would be important for people in the industry to be there helping make decisions.”

 

Pearce, self-described realist

 

“With all due apologies,” Pearce said, “we don't drive wind cars, no solar cars, no nuclear cars.” The 61-year-old conservative and former economics major at New Mexico State University describes what he calls a straightforward “problem of supply.”

 

Pearce flatly dismissed the notion of “peak oil,” the idea embraced by many, including most environmentalists as well as billionaire Texas oilman T. Boone Pickens, that world supply has maxed out at roughly 85 million barrels of oil produced each day and won’t go any higher, even though demand for oil in the short term will almost certainly continue to rise.

 

"There's no such concept of peak oil,” Pearce said. “It's too simplistic because the amount of oil available depends on the price.”

 

Pearce told the story of his father, also a southern New Mexico oilman, who he said was often warned in the 1980s that New Mexico was almost out of oil. “But that was at $2 (a barrel) oil. And then the price went to $12 and so we found other supplies. And then the price went to $20 and we found other supplies. We have found so many reserves that we did not know we had,” Pearce explained.

 

On the issue of global warming, Pearce also departs from what many consider a settled debate – that greenhouse gases produced by polluting power plants contributes significantly to rising temperatures and that sweeping changes are needed to correct this immediately.

 

NMI: Isn’t it the case that we should stop pumping more carbon into the planet’s atmosphere?

SP: "You got 100 percent (of greenhouse gases). You know what percentage of the greenhouse gasses are carbon? Five percent. You know how many of those five are actually human induced? One percent."

 

Pearce elaborated on his global warming skepticism.

 

“Keep in mind the argument on global warming is that over 100 years we've had a one degree increase in temperature. But you know what the temperature did this year?” Pearce pauses for effect. “It plunged. Ice for the first time in Vietnam in history!”

 

That’s not all.

 

“The polar ice caps have been shrinking over the past few years from 5 million square miles down to one and a half million. In one winter, this last winter, it burst back to 5 million. So all the concern that we're doing away with the habitat for the polar bear, suddenly the argument is gone,” Pearce continued.

 

Meanwhile, Pearce noted that fast-developing countries like China – with insatiable appetites for energy just like the United States – don't seem to be on the global warming bandwagon.

 

“China is building 544 new coal fired power plants. So we're giving up American jobs. I do not want to contaminate, I don't want to pump carbon out,” Pearce said emphatically, “but I also want to keep in mind that we're giving away jobs for no purpose. And so I would ask your readers: Are you willing to give up your job for the one-tenth of one percent that we can affect?”

 

NMI: But do you agree that most of the science isn’t on your side when it comes to global warming?

SP: “You know why the science is the way it is? Because we give out billions in grants and to get a grant you have to be on the side of global warming. So we rig the science.”

 

While Pearce’s first 30-second ad of his general election campaign suggests that expanded nuclear energy can “make America free from Middle East oil cartels,” he responds somewhat differently when pressed on whether America can realistically become “energy independent,” another one of his latest ad’s catchphrases, in the foreseeable future.

 

"We have to be able to affect the market price,” Pearce stated, “and to do that we have to produce more of our energy. So no, we cannot wean ourselves off of foreign oil, but we can lessen our demand to the point that it hurts (foreign suppliers) and they begin to respond with more production.”

 

The United States consumes roughly 21 million barrels of oil each day – about 70 percent of that amount is imported – but only produces about 7 million barrels daily.

 

Meanwhile, Pearce is bullish on coal power. On what might be New Mexico’s third coal-fired power plant in the northwest corner of the state – the proposed Navajo Nation-backed Desert Rock power plant – Pearce counts himself as a big supporter.

 

According to the Santa Fe New Mexican, Pearce called the proposed power plant “a wonderful step forward," that will “help bring thousands of new jobs to the area” and “allow the Navajo people to tap into abundant resources to produce new domestic energy for America.”

 

He told NMI that the power plant’s design specifications “set the bar pretty high” regarding greenhouse gas emissions. A recently published commentary in the Independent argued the opposite, that the plant won’t just emit tons of carbon dioxide into the atmosphere, but also “put out large amounts of mercury, ozone, sulfur dioxide, and nitrogen oxides which have been linked to significant health problems.”

 

Pearce is unconcerned. “I trust that the (Environmental Protection Agency) is doing their job,” he said, referring to the recent EPA decision to approve a permit for the would-be power plant.

 

In the final analysis, Pearce sees himself as a defender of the American way of life.

 

“Should we have less simple lives?” he asked rhetorically. “Should we have a lower standard of living? Myself, I'm not willing to make the commitment to give that away.”

 

Differences with Udall

 

According to Pearce, the biggest differences he has with Udall is on the future of nuclear energy and off-shore drilling.

 

Despite the Udall campaign’s insistence that the Santa Fe Democrat is open to some expanded nuclear energy, Pearce says don’t believe it.

 

“Tom Udall has opposed nuclear no matter what he says.” Further, Pearce challenges his opponent “to sign on that he would help me locate a nuclear reactor in New Mexico… And if no, then where? McCain is saying let’s build 45 new reactors. Would he sign a letter to encourage that?”

Udall did, however, vote for a 2005 energy bill that was backed by longtime nuclear-power advocate Sen. Pete Domenici.

 

On off-shore drilling, Pearce says it can be done in an environmentally sensitive way – and cites what he considers to be proof, namely Hurricanes Katrina and Rita: “They came right through the Gulf Coast, where there are thousands of off shore platforms,” Pearce said. “Not one drop, not one drop was spilled."

 

While many energy experts remain skeptical that expanded domestic prosecution could lower gas prices, Pearce argues that it could. He cites President Bush’s executive order last month to lift part of the prohibition on off-shore drilling – and what he saw as the result.

 

“Do you know how much the price of oil dropped in one day?” Pearce asked. “$6.44,” he answered. He says that simple “declaration of intent” has contributed mightily to a recent $20 per barrel drop in the price of oil.

 

Moreover, Pearce maintains that 70 percent of potential domestic oil production is off limits “by regulation or by lawsuit." He maintains that much oil remains to be explored in New Mexico despite a recent story by NMI's Joel Gay that casts serious doubts on that possibility.

Pearce against the “counterculture”

 

The Republican candidate likens opposition to fossil fuels today to some kind of '60s era protest. “We have a kind of a counterculture that says that we got to get off that dirty stinkin' oil and off that dirty stinkin' coal,” Pearce lamented. “I'm sorry, but great dislocation awaits."

 

If recent polling is to be believed, an uphill battle awaits Pearce in the final three months of the campaign.

 

Polling by Rasmussen and SurveyUSA indicates that Udall has a commanding lead in the race – leading by anywhere between 25 and 30 points. As a result, Pearce is pushing for more and quicker debates with Udall that could shake up the race.

Part of Pearce’s struggle lies in the fact that his opponent may be trying to blur what appear to be sharp differences between the two candidates.

According to a campaign spokeswoman, Udall “knows that nuclear is part of our energy future and we must also increase domestic oil drilling and production, crack down on hedge fund speculation, dramatically increas[e] fuel efficiency standards for automobiles and mak[e] serious investments in alternative energy.”

Some of those sharp differences are less likely to be blurred. For example, Udall has consistently opposed drilling for oil in the Arctic National Wildlife Refuge and two years ago he voted to continue a ban on energy exploration on the Outer Continental Shelf, as well as to cut $40 million for a program to expand nuclear power and resume U.S. nuclear fuel reprocessing.

 

Pearce, for his part, is trying hard these days to persuade a rattled, and thus persuadable electorate, on how to strike the right balance.

 

“We don't arrive lightly at our positions,” Pearce said as the interview was winding down. “I don't just write off all of the concerns on the other side. I do want to keep our environment clear, clean, all that jazz,” he offered. “But I don’t want to give up your jobs. And I do want to get the price down. That's the first goal because our economy is about to break.”

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'08 Election, Economics, Energy, Environment, Science & Tech, Transportation