The U.S. oil and gas producing industry should try something new in its appeal for effective energy policy. It should forget about abysmal rig counts, failing oil production, and growing U.S. dependence on imports. It should forget about the link between domestic oil and gas production and national security.
Those things are no less important now than ever. They simply don't matter much in U.S. politics. Arguments based on the need to drill more wells are doomed. Americans want fewer wells, not more. They have been tricked into believing that drilling and production are incompatible with nature. And their misunderstanding isn't likely to change.
Who cares about security? The Communist threat is crumbling. Why worry about import dependency? Oil's cheap. What's to be learned from the Persian Gulf war? The good guys won.
NEW FOCUS NEEDED
Last year proved the futility of arguments based on drilling and national security. Americans and their allies fought and died to keep Saudi and Kuwaiti petroleum reserves out of the hands of Saddam Hussein. Yet the U.S. Senate wouldn't even consider an energy bill that allowed leasing of the Arctic National Wildlife Refuge Coastal Plain.
The U.S. producing industry should shift the focus of its arguments from drilling and national security to something all Americans in a wheezy economy can understand: jobs. Errors of current energy policy do more than keep oil and gas companies from drilling wells in necessary numbers and locations. They keep Americans from working.
When the government refuses to lease federal land or to issue permits on existing leases, the industry shouldn't concentrate on the wells that won't be drilled. It should instead stress the number of people that cannot be employed drilling wells and sustaining rig crews.
When the government refuses to quit taxing drilling capital, the industry shouldn't fret about reserves that won't be discovered and produced. It should instead focus on the people that cannot be employed manufacturing rig masts, tubular goods, and drill bits.
And when the government, as it then must, tries to justify unemployment on environmental grounds, the industry should be ready with answers: drilling and producing operations don't spoil nature; they don't even occupy much of nature; and they don't last long in natural terms. Furthermore, technology enables the industry to accomplish more with fewer wells than ever before and to make wellsites increasingly compact and unobtrusive.
The producing industry cannot successfully counter environmental exaggerations when it bases its arguments on drilling and national security. It must, therefore, emphasize people and work.
COMMON GROUND
The U.S. government keeps Americans from working with faulty environmental and tax policies. Against that background, President Bush's job quest last week to Australia and Asia looked absurd. Why should other countries sacrifice trade for the sake of American jobs when the U.S. itself deliberately consigns Americans to unemployment?
Joblessness and frustration provide new common ground for producers and Americans in other businesses. They create a basis for communication, a chance to highlight economic perspectives in issues of energy, taxes, and the environment. Industry should make use of this rare political opportunity. If appropriate policy changes result from a new focus on petroleum industry jobs, increased oil and gas production and diminished reliance on imports can be important, if popularly unappreciated, byproducts.
Copyright 1992 Oil & Gas Journal. All Rights Reserved.
