As gas prices surge, many rally to what Andy Jackson wrote recently in The Herald: "Drill now, drill here." I am for anything responsible to bring prices down, whether it's more drilling or less speculation. But everyone should know that we are drilling more, and have been for several years. Between 1999 and 2007, the number of drilling permits issued increased by 361 percent. Here in a nutshell are the details:
• Over the past four years, the government issued 28,776 permits to drill on public land. In all, 18,954 wells were actually drilled while 9,822 permits are still unused.
• On-shore, 47.5 million acres of federal land are under lease, but only 13 million acres are actually producing oil or gas. Off-shore, 44 million acres are under lease, but only 10.5 million acres are in production.
• If the 68 million acres leased but not used were put into production, and if this acreage yielded the average of other federal lands, we would gain 4.8 million barrels of oil a day and 44.7 billion cubic feet of natural gas. This would nearly double domestic oil production and increase natural gas production by 75 percent.
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• Roughly 81 percent of the identified oil and gas on federal lands, on-shore and off-shore, is available for drilling or will be upon completion of environ-mental reviews. Potential resources are estimated at 107 billion barrels of oil and 658 trillion cubic feet of gas.
The first President Bush imposed a moratorium on off-shore drilling in 1990 in response to spills off the California coast. President Clinton extended the moratorium through 2012. This ban does not apply to numerous areas in the Gulf of Mexico or to various sites along Alaska's coast or to many off-shore sites in California in production before the moratorium was imposed.
In 2005, Congress passed the Energy Policy Act, which called for an inventory of tapped and untapped sites as a first step to orderly exploration. I voted for it. In 2006, I voted to open 8.3 million acres to drilling in the eastern Gulf of Mexico, and just last week, I voted to affirm that the 23.5 million acres in the National Petroleum Reserve is open to exploration and drilling.
Advocates of drilling in the Alaskan Arctic are fixated on the Alaska Natural Wildlife Refuge, but ANWR has been off-limits since the days of President Eisenhower. Just west of ANWR is the National Petroleum Reserve, which has been open to leasing since 1999. The United States Geological Survey estimates that between 5.9 billion barrels and 13.2 billion barrels of oil may be located here, and that it's economically recoverable at prices of $22 to $30 per barrel. Natural gas estimates range to as much as 83 trillion cubic feet. Of this, 35 trillion cubic feet have been identified, but this gas is stranded, ready to be tapped but only when a pipeline is built to move it through Canada to the lower 48.
Squabbling over pipeline
For years, the oil companies operating on the North Slope have been squabbling with Alaska and the federal government over where a pipeline should go, who should pay for it, and whether the government should subsidize it. This is a site that can be tapped now and in production sooner than most off-shore sites. The Bush Administration should use its clout to break this impasse, and get a gas pipeline going.
Here are some more "low-hanging fruit:"
• Require the oil companies sitting on 68 million acres of leased land to "use or lose" their drilling rights.
• Tap some of the 702 million barrels of oil stored in the Strategic Petroleum Reserve, forcing speculators to bid down prices.
• Make it more difficult for speculators to bid up the price of oil and gas.
• On the demand side, take a few bold steps toward conservation, like lowering the speed limit on interstate highways.
As for off-shore drilling, the presidential moratorium has been lifted, and the congressional moratorium runs from year to year. Frankly, there may not be enough votes to extend the moratorium past its Sept. 30 expiration, so many in Congress are open to compromise. At a minimum, a coastal state should have the freedom to opt in or out of drilling off its shores and the power to place sensitive sites off-limits. Royalties should be assessed, and a healthy share should be dedicated to the development of fossil fuel alternatives and to the conservation of wetlands, marshes and the coastal environment.
The pledge that Andy Jackson wants me to sign deals with none of the above. It states simply: "I will vote to increase U.S. oil production to lower gas prices for Americans." This is hardly a plan of action, and leaves those who sign it with an open-ended commitment to vote for anything that "increases U.S. oil production." After many years in Congress, I have come to be wary of the devils lurking in such deals. The last off-shore drilling bill before Congress was written by the Gulf Coast states, and it raised their cut of royalties by $600 billion over the next 50 years, so much that even the Bush Administration opposed it.
The Petroleum Reserve
This month, the House took up a bill to expedite leasing in the National Petroleum Reserve, to require oil companies to "diligently develop" or "relinquish" existing leases; to require the Bureau of Land Management to "expeditiously facilitate" new pipelines to connect new oil wells to the Trans-Alaska Pipeline; and to require the president to "expeditiously facilitate" a new gas pipeline from the National Petroleum Reserve to the lower 48. This is a plan of action, and it should increase production. I voted for it. How did the author of the pledge vote? Rep. Westmoreland, R-Ga., voted no.
Andy Jackson acknowledges that it will take time before more drilling adds appreciably to our supplies of oil and gas. He's right, and ANWR is a good example. According to the federal Energy Information Agency, if exploration in ANWR began now, significant quantities of oil would not start flowing until 2018. Production would peak at 780,000 barrels a day by 2028. The addition to world supplies would range from 0.4 percent to 1.2 percent in 2030, and the downward effect on world prices would range from 41 cents to $1.44 per barrel.
Andy Jackson argues that we still can send a strong message to the oil-exporting nations, and this in itself may bring prices down. I have made the same argument about our commitment to alternative fuels. In truth, neither of us knows what may happen.
We do need to drill more, but we should be realistic and start looking beyond fossil fuels to the massive investment that's needed for alternative energies: nuclear, ethanol, clean coal, hydrogen, wind, solar, batteries and biomass. I will gladly sign that pledge.
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