Dear Tom Toolpusher:
You wanted me to drop you a note on how Clinton & Co.'s energy policy was coming together. Well, it finally has.
Granted, the new bunch is laboring in a difficult fiscal and environmental atmosphere. But it's hard not to be a little disappointed in what they've done so far.
POLICY KEYSTONE
The keystone of the Clinton administration's energy policy is Energy Sec. Hazel O'Leary's new "gas and oil initiative."
Now, we know the industry has always used the words "oil and gas" in that order. Like on the cover of that yellow and black magazine. So if the Department of Energy calls it a "gas and oil initiative," what does that tell you?
Right. A PR man confirmed: "The title is indicative of a sea change here in the department where we put gas first."
Maybe they forgot that the U.S. imports nearly 50% of its oil but only 4 10% of the gas it uses.
Lobbyists said the plan is like a vegetarian hors d'oeuvres platter: 49 kinds of cute tidbits. But no meat.
To unveil the program, O'Leary held a big press conference.
She roamed the stage with a portable microphone explaining the color slides, receiving testimonials from guest speakers, and bubbling with enthusiasm.
But after her presentation, O'Leary, who seems to have a knack for getting "misquoted" by reporters, had time to answer only three questions. What does that tell you?
When the deputy secretary answered a few more questions later, he admitted the department doesn't know how much the plan might boost U.S. production.
WHAT DOES THAT TELL YOU?
Over at the Interior Department, lawyers had a bad year. One suite of lawyers decided producers owe royalties on Section 29 (tight and coal seam gas) tax credits. But fortunately, another group of lawyers recently overruled them.
Even worse, Minerals Management Service lawyers drafted incredibly tough offshore oil spill insurance rules.
Industry warns the rules would cripple offshore E&P and might even require a tank truck driving over a West Texas creek to be covered by $150 million of spill liability insurance.
MMS also dropped another bombshell: It may consider holding smaller, more frequent Gulf of Mexico lease sales in order to increase federal revenues. It didn't mention how that might affect production. What does that tell you?
REFORMULATED GASOLINE
The Environmental Protection Agency finally set its rule for reformulated gasoline, which must be produced in 1995.
EPA honored its deal that ethanol won't be in the gasoline formula but then proposed a new rule to require renewable fuel like ethanol.
EPA's tree huggers took special pride in the fact they issued the 1,000 page document via a computer bulletin board, saving hundreds of pines from paper mills.
Was this environmental policy or a farm subsidy program? Well, EPA had an agriculture guy present to answer questions about additional corn production. What does that tell you?
Copyright 1994 Oil & Gas Journal. All Rights Reserved.
