Known Offshore and Alaska Oil Rediscovered
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http://www.nytimes.com/2008/06/19/business/19drillship.html?_r=2&scp=1&sq=Dearth+of+Ships+Delays+Drilling+of+Offshore+Oil&st=nyt&oref=slogin
Type of Content: Article As public anger over rising fuel prices continues to grow, Mr. Bush finally called on Congress to lift the federal bans on offshore drilling and exploiting the known resources in the Arctic National Wildlife Refuge. Good move, but that doesn't mean the bans will be lifted tomorrow. On May 21, Shell Oil President John Hofmeister and other top executives of U.S. energy companies testified before the Senate Judiciary Committee. The hearing was designed to point the finger at the oil companies for the high prices everyone is experiencing. But one after the other of the energy chiefs threw the blame right where it belongs: on the government's bans on energy production. Citing figures supplied by Department of the Interior, Hofmeister told the senators that "62 percent of all onshore federal lands are off limits to oil and gas developments, with restrictions applying to 92 percent of all federal lands." As for known offshore oil and gas deposits, he pointed out that there are "outer continental shelf moratoriums" for drilling in the Atlantic Ocean, the Pacific Ocean, and the Eastern Gulf of Mexico. He noted also that there are "bans on on-shore oil and gas activities in specific areas of the Rockies and Alaska." Finally, he added that there is even a congressional ban "on doing an analysis of the resource potential for oil and gas" in the offshore areas. Exxon Mobil's Stephen Simon lamented that his company, America's largest in the oil and gas industry, is forced to compete with government-controlled companies worldwide who do not impede production the way our government does and who subsidize the cost of energy for their consumers. As for U.S. companies supposedly profiting from rising prices at the pump, the executives repeatedly pointed out that 15 percent of the cost to fill a gas tank goes for taxes and only 4 percent goes for profit. While there are costs for refining and transportation, the largest single item in the cost for gasoline and home heating oil is the amount paid to importers. And our nation now imports 60 percent of daily consumption. Intrigued by mention of resources available in Utah, Colorado, and Wyoming, Senator Orrin Hatch (R-Utah) asked if known deposits of oil in these three states "could be recovered at somewhere between $30 and $40 a barrel." Hofmeister answered that the figure cited might be outdated, but he said that production could be accomplished at a much lower figure than the $130 per barrel being paid for imported oil. If Congress does cancel the bans on obtaining offshore oil, companies like Shell and Exxon Mobil will face the daunting prospect of obtaining ships capable of erecting deep-water rigs. Most of these specialty vessels are being produced in Asia, especially in South Korea. And demand for them has risen as sharply as the rise in global energy consumption has escalated. Brazil, with huge newly discovered offshore reserves, has plans to buy or produce scores of such vessels. A South Korean company is currently building a ship made specifically for drilling in the Artic. Wouldn't that be helpful in the waters off ANWR! Congressionally instituted bans on obtaining known resources within U.S. territory (both offshore and in Alaska) have put our nation in a deep hole. Getting out of it is absolutely imperative. At least now there's been some talk. Americans, all of whom are hurting when it comes to driving their vehicles and heating/cooling their homes, are advised to let their congressman know that there is a way out of the hole. It’s called: Develop our own resources. The sooner the better! Read »
Created 28 weeks 4 days ago
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