The U.S. Department of Energy plans to create an office to promote exports of American oil field equipment and services.
Deputy Energy Sec. W. Henson Moore has pushed the initiative, saying that small U.S. service and supply companies often are at a competitive disadvantage when they seek contracts overseas (OGJ, Nov. 20, 1989, p. 30).
He planned to announce the move at a Tampa, Fla., meeting of the Petroleum Equipment Suppliers Association last week.
EXPORT INITIATIVE
Moore told Oil & Gas Journal DOE will appoint a new deputy assistant secretary for export assistance in its international office. It will recruit a person from the oil industry with experience in international contracting.
The Commerce Department is expected to lend DOE experienced personnel to help staff the new office.
Moore said, "We also have to define what we're doing. We're probably never going to be a marketing department-nor should we be. Most of these companies know better than we do where the markets are. Where they're having trouble is getting into them. And that's where we come in, helping remove barriers.
"One of the principle functions of this office is going to be to constantly receive complaints, requests, ideas from the industry and then prioritize those and go to work on them in removing barriers.
"There have been a number of instances lately in which our companies are not being treated equally."
He said DOE will continue to work with the energy ministers of other countries to reduce trade barriers. And it will use existing State Department trade personnel overseas, rather than post its own people in embassies.
SOVIET VENTURES
However, Moore said, "We're thinking very seriously about assigning a DOE person to the American embassy in the Soviet Union to work with the full cadre of State Department there to protect our interests in the energy sector."
He said the Soviets are seeking to negotiate a bilateral agreement on exchange of energy technology with the U.S., "but we're not sure what they bring to the table, what energy technology they can share with us."
Moore said DOE is more interested in developing energy trade with the Soviet Union, permitting U.S. companies to operate there more freely. But it's been very difficult to get anything very meaningful going because of the fragmentation of Soviet bureaucracy.
"The Soviets are interested in doing business with us," Moore said. "They know our technology is good. They know we can help them improve their efficiency."
He said the problem of repatriating profits is a major one for smaller service and supply firms.
"They have problems with taking profits out of their country. They're trying to work with us. They understand we can't work entirely in their system. They're beginning to understand the lack of trading in rubles. They're beginning to understand that some people just can't wait for a share of the oil. And they're beginning to understand that we have problems in terms of them not having hard currency.
"We're trying to perfect a couple of possible ways we can help in that regard."
OTHER ISSUES
Next month Moore will speak to the European Community's energy committee to argue against the proposed Article 28 to the EC constitution, which would allow countries to reserve half of their energy business for native companies.
In a later trip to the Far East, Moore will discuss the export of Alaskan North Slope gas to the Pacific Rim customers.
He is optimistic about world oil prices although he admits, "The short term is not good. Gas prices are not good right now. Oil prices have been flipping around, and slipping, and may slip through the summer months. But we still remain very bullish on the long term and a very gradual increase in real prices."
Moore wants to know how the fall of the Iron Curtain from eastern bloc countries will affect world oil supply/demand in the long run.
"As they go into a market economy they're going to consume more energy. They're going to want to have a better standard of living. Everybody will want to have their own apartment and automobiles, and that means they're going to consume more energy.
"How do you crank that into the calculation of world supply and demand of oil and gas? I'm not sure anybody has an answer to that.
"Something tells me that this may throw out of whack people's price projections over the next decade. Prices may go higher than predicted because there will be greater consumer demand."
If the U.S. negotiates a free trade agreement with Mexico, similar to the one with Canada, Moore wants it to give U.S. firms access to Mexican oil service and supply markets. "We're very interested in what we think is going to be additional offshore drilling Mexico will be doing. If we can't get our rigs from New Orleans and Houston down to the east coast of Mexico cheaper than anybody else in the world there's something wrong."
He said the U.S. would be receptive to resumption of natural gas imports from Mexico.
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