In 2007's final weeks, preparing for 2008

IPAMS is preparing a grassroots effort to politically mobilize 150,000 oil and gas employees and contractors in the Rocky Mountains.

Dec 14th, 2007

Marc W. Smith arrived in Washington from Denver for his latest visit on Dec. 3 as Speaker Nancy Pelosi (D-Calif.) and the rest of the US House leadership announced their latest energy legislation.

The new bill concentrates on raising automotive fuel efficiency requirements and addresses ethanol and other bio-fuel programs. But the Independent Petroleum Association of Mountain States' executive director was well aware that proposals which could hurt oil and gas producers are still alive and well (including establishing a reported $4,000 fee for processing each drilling permit application).

But Smith and IPAMS are doing more than simply checking in with members and staffs of the 110th Congress from the Rocky Mountains. They also are talking to groups and individuals active in grassroots organizing so they can mobilize 150,000 oil and gas employees and contractors in those states.

"The political landscape has changed in the Mountain West," he told me on Dec. 4. "A number of state legislatures have turned anti-industry. We also have a number of new governors who don't understand the oil and gas business. Even at the county level, support for the industry is not a long-term guarantee."

IPAMS wants to work with state oil and gas associations on a comprehensive plan to educate and mobilize the industry's employees and contractors in the region. "They need to stand up and be counted, and cast their votes for candidates who will support a strong domestic energy industry. Many are new to the area and need to register to vote," Smith said.

Grading candidates

The program would include a fair method of grading candidates, irrespective of their party. The basic political demography in Colorado and other states hasn't changed much from the traditional urban-rural split.

The primary change, said Smith, is that industry opponents are reaching out with like-minded individuals to try and convince first, state legislatures and, second, Congress, that support for oil and gas development is waning in the West. "It's usually the same five or six individuals who are quoted in the press," he said.

Misleading information comes in three basic forms, he indicated. The first is that a renewable energy economy could be achieved in 10 years. "This flies in the face of every prediction by credible energy experts," Smith said.

Area residents also often don't understand the role the Rockies play in supplying conventional energy to the US, with the region about to surpass the Gulf of Mexico as the biggest single contributor. "Production has grown 70% there in the last 10 years while most other regions have declined," he said. Rockies gas production has climbed more than 20% in the last three years to a point where it represents about 25% of the nation's total, he added.

"We're not against renewable fuels. We consistently support a diverse energy portfolio which includes them. But natural gas is critical to a secure US energy future," Smith said. More than half the states with renewable portfolio standards for electricity generation list gas as the backup fuel for wind, solar and other intermittent sources, he noted. Bio-fuel production also requires large amounts of gas for fertilizer and for conversion from corn, cellulose and other plants.

Either-or? Hardly

A second erroneous assumption is that the Mountain West must choose between sacrificing its scenic and recreational assets to develop energy and preserving large tracts for wildlife. Smith said that US Rep. Diana DeGette (D-Colo.) introduced a bill on Oct. 4 which would add 1.8 million acres to the national wilderness system, including land with hundreds of plugged and abandoned oil and gas wells.

"We think it's intellectually dishonest to say, on one hand, that an area is ruined forever if you allow oil and gas development and, in the next breath, say areas that once produced oil and gas are so pristine they deserve protection now. We have hundreds of aerial photographs and satellite maps which show that exploration and production have no lasting impact," he indicated.

The third mistaken notion is that nothing bad will happen if oil and gas activity in the Rockies is slowed or stopped. "They don't appreciate that 50% of the gas we use today comes from wells drilled in the last four years," said Smith.

Unconventional reservoirs which are currently being produced deplete about 50% of their reserves in the first five years and the remainder over 20 to 40 years, he pointed out. "If you slow down the pace of new drilling, you don't glide into a nice supply curve. You fall off a cliff. If that happens in a region that produces 25% of the nation's natural gas, the country will be in serious trouble," he said.

That's why Smith thinks next year's elections will be especially crucial. "Every office, from president to county commissioner, will determine how the United States faces its energy challenges," he said.

Contact Nick Snow at nicks@pennwell.com.

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