Good point. But even if you are using it to power your hummer or war jet, it won't be extracted because it gets you net energy, but because it provides energy in a dense, liquid, easily transported form that suits certain functions, wasteful or not. Essentially it will be a handy carrier, rather than a source, of energy, like electricity.

Yeah, I agree. The military will undoubtedly want liquid petroleum based fuels regardless of how expensive they are.