Bob Tippee
An effort is under way to coordinate the oil and gas industry's relief and reconstruction responses to the devastation of Hurricane Katrina.
John Walker, president and chief executive officer of EnerVest Management Partners and chairman of the Independent Petroleum Association of America, is spearheading the coordination effort.
He has met with leaders of other industry associations and was to have visited the Department of Energy Sept. 15 to discuss a role for the National Petroleum Council, an advisory council to the secretary of energy.
Coordination at the national level is a good idea. It can improve the efficiency of industry relief. And it can help communicate how much has been and will be done to assist storm victims and rebuild devastated communities.
The latter benefit, especially if it can be accomplished under auspices of NPC, would put complaints about price "gouging" in useful context.
Those allegations grow out of the inevitable coincidence of crisis oil price levels and elevated oil company profits.
In fact, billions of dollars in lost and wrecked equipment and thousands of dislocated workers represent nobody's preferred way to make money.
If industry profits in a supply emergency must become a political issue then industry spending on emergency responses deserves attention, too.
Companies and contractors are spending heavily on reconstruction, on charities, on a displaced workforce. At this point, no one can guess how much money ultimately will be involved.
Individually, most companies will announce their contributions to the Red Cross and other charities as well as their spending on reconstruction of their own and others' property. But those reports will receive little notice.
What's needed is a central accounting of all industry spending on reconstruction and relief related to Hurricane Katrina—including both charitable donations and what companies spend to make their operations and workers whole. The category lines will be hazy, the accounting complicated.
But it will demonstrate to a cynical nation that Katrina hit the oil and gas industry where much of it lives, that crisis profits came at a horrible cost, and that companies didn't hide the money under a mattress.
(Online Sept. 16, 2005; author's e-mail: [email protected])