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U.S. Oil, Gas Producers Call for Government Report on Available Energy Supplies

H.R. 6251 – Another Road Block to America’s National Security

The following is a statement from Barry Russell, president and CEO of the Independent Petroleum Association of America (IPAA).  IPAA represents the 5,000 U.S. businesses that develop 90 percent of America’s oil and natural gas wells both onshore and offshore.  The bill largely affects independent oil and natural gas producers, who hold the majority of federal leases, including 90 percent of the offshore federal leases in the Outer Continental Shelf.

“Several House Democrat leaders recently unveiled H.R. 6251, the Responsible Federal Oil and Gas Lease Act. Unfortunately, it is another example of political posturing that continues to thwart any long term, comprehensive solution to increase American energy supplies and to reduce America’s dependence on Middle Eastern oil.  Instead, Congress should enact legislation – favored by the majority of Americans – that increases American oil and natural gas supplies, rather than continuing our reliance on foreign oil.

“House Speaker Nancy Pelosi promised an open and honest legislative process when the Democrats gained control of Congress a year and a half ago – around the same time they promised to bring down the price of fuel.  However, House floor action on legislation that is based on phony committee reports is a mockery of the U.S. legislative process. H.R. 6251 is based on information that was created without any hearings or any Government Accountability Office (GAO) or Congressional Research Service (CRS) reports.

“America’s oil and natural gas producers today call on Congress to initiate a GAO or CRS analysis to evaluate what is clearly misinformation and another mechanism to divert attention from the real issue – security of American energy supplies. The Natural Resources Committee should hold hearings to determine the real facts. The House should not be legislating in a vacuum of information.

“We need relief from rising energy costs and HR 6251 prevents the aid that America needs today. The legislators who introduced this bill are impeding the possibility of exploration for American energy resources and further increase our dependence on foreign oil.  The only realistic solution to our nation’s energy crisis is to increase access to all viable sources of clean, efficient, safe, abundant and affordable energy.

“It is very discouraging that federal policymakers are grandstanding and using illegitimate reports about American oil and natural gas businesses that continue the stranglehold on new, American energy supplies.  For example, some legislators are claiming that the federal government should not allow new energy exploration because American oil and natural gas companies are not producing energy from every acre already available.  But the fact remains, that not every available acre has oil or natural gas under it.  Congress, today, does not allow access to the federal lands that contain vast supplies of American energy.  Most land is simply off-limits.  We must develop these available energy resources as one element of curing America’s energy problems.  Only Congress has this power.

“Companies spend millions, sometimes billions, of dollars on bonus bids to the federal government to acquire leases. In addition to the costs for bonus bids, companies must also pay annual rental payments during the pre-production period to the federal government to retain access to the area. Leases that are not drilled within a specified number of years (5 years for shallow water leases and 10 years for deep water leases) must be relinquished to the federal government. The fact remains that a lease is only a rental agreement and does not guarantee that the leased area contains any oil or natural gas.” 

“While it is true that exploration in areas that are currently off limits will not produce oil and natural gas in the short term, American policymakers must enact solutions today that will produce results tomorrow. American consumers are getting on board and calling for greater deep sea exploration, now it is time for Congress to provide leadership and take actions that will help bring some relief to consumers in the near future. If we don’t take the necessary steps today, America will be in a worse position tomorrow.”  

For more information on America’s independent oil and natural gas producers,
click on the link below:

http://www.ipaa.org/news/docs/WhoAreIndependents.pdf

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IPAA is the national trade association representing oil and natural gas producers that drill 90 percent of the nation's oil and natural gas wells. These companies account for 68 percent of America's oil production and 82 percent of its natural gas production.