[Congressional Record Volume 143, Number 122 (Monday, September 15, 1997)]
[Senate]
[Pages S9351-S9352]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         ADDITIONAL STATEMENTS

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                ENHANCED OIL RECOVERY PROJECTS PROGRESS

 Mr. DOMENICI. Mr. President, in 1989, I stood on the Senate 
floor and urged the Senate to enact tax incentives for enhanced oil 
recovery techniques.
  At that time, I told my colleagues that traditional drilling 
techniques were leaving behind 70 percent of the resource when 
traditional drilling and pumping was completed. To me, this was 
wasteful, foolish, and unnecessary.
  It is wasteful to leave the oil behind.
  It is foolish because the United States has a growing appetite for 
energy. We are currently importing close to half of the energy we use 
from an area of the world renowned for political instability.
  It is unnecessary because we have the technology to recover the 
resource if we would use enhanced oil recovery techniques.
  In 1989, I also told the Senate that it would be possible to recover 
another 20 billion barrels of oil from our same oil fields of existing 
wells if enhanced oil recovery techniques were used. Since our known 
recoverable reserves at that time were in the neighborhood of 28 
billion barrels, the potential was, and still is, significant.
  At that time, the Department of Energy conducted extensive studies 
showing that if a 15-percent investment tax credits were enacted, it 
could result in the recovery of additional reserves for as little cost 
to the Treasury as $1 per additional barrel recovered--assuming $20 per 
barrel oil.
  For each and every dollar of Federal revenue invested in EOR 
incentives, the trade deficit would be reduced by $24 to $76 dollars 
according to the same DOE studies.
  States with significant EOR potential include California, Texas, New 
Mexico, and Oklahoma. Other States with reserves include Arkansas, 
Colorado, Florida, Illinois, Kansas, Louisiana, Mississippi, Montana, 
North Dakota, Utah, and Wyoming.
  In 1990, the Congress enacted tax incentives to encourage enhanced 
oil recovery so that more of this vast resource could be recovered and 
put to good use. I am proud to have been the primary sponsor of that 
legislation.
  As a Senator, one of the greatest rewards is seeing a new law make 
the world a better place. During the August recess I had this rewarding 
experience. I also saw the predictions of the theoretical studies 
proven up in the real world.
  I toured the Texaco enhanced oil recovery project located in Buckeye, 
NM. The technical name of the project is the ``Central Vacuum Unit 
CO2 project.''
  This particular oil field was discovered in 1929. Primary oil 
recovery techniques were used until 1977. Beginning in 1977, the field 
was transformed into a waterflood operation. Waterflood is a secondary 
oil recovery technique. The waterflood technology sustained and 
enhanced production for awhile, but it was evident that either the oil 
wells in the field would be shut-in and the field-shut down leaving 
behind a significant amount of oil, or enhanced oil recovery methods 
could prolong economic levels of production. One very promising 
enhanced oil recovery technique involves injecting the wells with 
CO2.
  CO2 injection is an enhanced oil recovery technique 
eligible for a 15-percent Federal investment tax credit. Using 
CO2 is going to significantly extend the life of this mature 
field by more than 20 years. The project will recover an additional 20 
million barrels of oil and 23 billion cubic feet of gas that otherwise 
would have been left behind.

[[Page S9352]]

  Texaco is the operator of this project. Marathon Oil, Phillips 
Petroleum, Mobil Exploration and Production U.S. Inc., and 15 others 
are interest owners in the project.
  New Mexico is blessed with magnificent oil and gas reserves. It is 
doubly blessed because it is also the home to the New Mexico Institute 
of Mining and Technology Petroleum Recovery Research Center. The center 
has served as a focal point for development and application of improved 
oil and gas recovery processes. They have a world-renowned reputation 
as one of the leading petroleum research centers. They were very 
helpful in developing the original legislation.
  In every oil- and gas-producing State, there are aging oil and gas 
fields with declining production, that could be made more productive 
using enhanced oil recovery techniques. I am pleased that there is a 
fine example in New Mexico. It is providing 100 jobs in addition to 
adding to our energy security.

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