Patrick CrowU.S. Energy Sec. Bill Richardson has released a barrage of small measures to help oil companies through the current depression, and has more coming.
So far, none of the Energy Department initiatives would improve producers' bottom line (OGJ, Feb. 22, 1999, p. 24). That's one reason small producers want federal tax relief for marginal wells.
Although the Treasury Department-somewhat predictably-opposes such tax breaks (see story, p. 30), Richardson maintains it's not a dead issue yet.
He said DOE is working within the Clinton administration "to see if part of the tax bill (this spring) can consider these initiatives."
Richardson plans to announce a program this month to provide emergency loans for independent producers.
Also planned is a White House summit on low oil prices within 3 weeks.
Richardson said, "We're going to be meeting at the White House with representatives of the industry and top White House officials to deal with these issues. We're ready to come up with a plan to help, if it does not interfere with oil markets or oil prices."
The Secretary plans to travel to Oklahoma and other oil producing states to meet with government officials and producers.
And Richardson said energy officials of the U.S., Mexico, and Venezuela will meet soon in a conference to discuss hemispheric energy cooperation and climate change issues.
SBA programDOE recently said it would work more closely with the Small Business Administration to help independents and service companies take advantage of the SBA's loan programs.
DOE and SBA will establish a working group to act as a liaison between producers, banks, and federal small business assistance agencies.
It will provide administrative and technical support to banks and financial institutions assisting domestic oil producers, and it will seek ways to cut red tape in the SBA loan guarantee programs.
Richardson said, "By providing a liaison...we will make it easier for eligible small producers and service organizations to use small business assistance programs to weather the storm buffeting the domestic oil industry."
Senate hearingDespite his efforts, oil state senators lectured Richardson at a recent Senate energy committee hearing.
Sen. Don Nickles (R-Okla.) criticized the secretary's recent trip to Saudi Arabia to help large oil companies secure business there.
Nickles said, "The majors do business all across the world. Why do the majors need our help to do business in Saudi Arabia? We don't need to provide economic help to majors going into Saudi Arabia."
Richardson replied that, if the Saudis choose U.S. firms to help them develop gas reserves, it would mean jobs for the U.S.
Senators also demanded action on relief measures for marginal wells.
Richardson said, "We know these are tough times. We do feel the pain of the industry, and we're trying to take the steps that address our long-term energy security strategy. We can't interfere in markets or global oil prices. But we can develop a long-term energy security strategy that deals with the problem."
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