Happy New Year! It promises to be every bit as lively for oil and gas-and the industry’s interactions with government-as 2005 was. But before we get too far into 2006, let’s take a nostalgic look at the past year’s most entertaining moments.
They’re all worthy of recognition, if not outright awards. I’ll improvise and call them “Watchies” (or, individually, “Watchy”) until my editors and readers come up with something better.
The first 2005 Watchy, for courage in the face of enemy fire, goes to David J. O’Reilly, chief executive of Chevron Corp. One of five multinational oil company executives called to testify Nov. 9, before two Senate committees about profits and prices, he decided to fire back in his opening statement.
O’Reilly noted that in the late 1980s, Chevron made a significant gas discovery in the eastern Gulf of Mexico’s Destin Dome that held enough natural gas to supply 1 million American households for 30 years.
Forced to leave
But Chevron and its partners could not get permits to develop the field because of opposition in Florida and federal regulatory and administrative barriers, he said. So the companies relinquished their leases as part of a 2002 government settlement.
Now, said O’Reilly, Chevron is “co-leading a project to produce and liquefy natural gas in Angola, ship it to an import facility on the US Gulf Coast, and then pipe it to the market. The customers will be the same customers who could have been supplied by natural gas just miles off the shore of Florida,” he continued.
One of Florida’s two US senators tried to respond that morning. Republican Mel Martinez said that Eglin Air Force Base uses much of the Gulf of Mexico for training, and the decision to ban Destin Dome leasing was bipartisan. But to anyone who was actually listening, O’Reilly made his point.
2005’s ‘NIMBY’ winner
Martinez, by the way, wins the second 2005 Watchy, in the fiercely competitive NIMBY (not in my backyard) category. At one point, the senator noted that while he could never accept leasing off Florida’s coast, he supported sales within the Arctic National Wildlife Refuge because it was in the national interest.
Sen. Ted Stevens (R-Alas.), the leading congressional advocate for leasing within ANWR, deserves a Watchy for candor. During his Senate floor speech on Dec. 20, he released 25 years of frustration when he declared, “In almost every vote that’s involved Alaska since I’ve been here, it’s been close. Why? Because extreme environmentalists consider Alaska their personal playground!”
The final 2005 Watchy must be shared, but it’s significant. It goes to Rep. John E. Peterson (R-Pa.), Sen. LaMar Alexander (R-Tenn.), both of Virginia’s US senators, and state Sen. Frank W. Wagner (R-Va. Beach). All helped revive discussions of possibly opening more of the Outer Continental Shelf to leasing. Opposition remains formidable, but at least lawmakers are talking again. ✦