WATCHING WASHINGTON RECALLING 1980

These are trying times for oil industry lobbyists.

Environmental issues have companies and associations very much on the defensive. Tanker accidents have spawned oil spill liability legislation. Clean air legislation will slap industry with more costly controls, while giving alcohol producers a boost in the gasoline marketplace.

The Bush administration last week made a very political decision to ban further exploration off California and Florida. And it opened the door to potential tax increases, with the gasoline tax a prime candidate.

ENVIRONMENTAL EMOTION

It was in that atmosphere that Charles DiBona, the American Petroleum Institute president, addressed a meeting of the South/West Energy Council in Washington. He said environmental issues are so much in the public eye they are dominating much Washington policy making and denying energy issues a fair hearing.

Environmental legislation is being considered more in the atmosphere of il emotion and political pressure" than of merit or scientific judgment. The federal government should focus its energy policy on "real world energy issues" rather than relying solely on "haphazard byproducts of environmental policy. "

DiBona said, "in fact, in two decades of work on energy issues in Washington, I have never seen a more difficult-often hostile-political climate than we have today on Capitol Hill.

"There is incredible pressure when any environmental issue comes up for a vote in the House or Senate. Much of the time, there are members who agree with us on substance but feel compelled to vote against us on politics. We've seen this phenomenon before from time to time but never as widespread as today."

DiBona didn't say so, but the atmosphere is reminiscent of 1980, which could have been the nadir for the oil industry on Capitol Hill.

In one way, 1980 was the best of times for the industry: Oil prices were near $40/bbl and the U.S. active rig count was 2,800.

But lawmakers were angry and took it out on oilmen.

In 1980 Congress passed the "windfall profits" tax an excise tax that had nothing to do with profits but cost the industry $77 billion before it was junked in 1988.

Industry wasn't overly fond of a companion bill that created the U.S. Synthetic Fuels Corp., which Congress intended to be ahead of its time. SFC turned out to be too far ahead of its time. It was tossed out in 1986.

Congress passed the Alaskan Lands Act, which blocked leasing on the Arctic National Wildlife Refuge Coastal Plain, considered the best remaining chance to explore for oil in the U.S.

OTHER ACTION

Also in 1980, legislators seriously considered creating an agency to regulate the price of oil imports, applied pressure on the new Department of Energy to prosecute oil companies that failed to comply with Byzantine petroleum pricing and allocation rules, laid the groundwork for creation of a Superfund to clean up chemical spills-and required the oil industry to foot the bill and sent to the Senate floor a bill barring the 18 largest oil companies from acquiring or merging with other corporations.

Once again, the oil industry seems to be on the receiving end of congressional attention. But compared with 1980, maybe things aren't so bad after all.