[Congressional Record Volume 151, Number 132 (Tuesday, October 18, 2005)]
[House]
[Pages H8894-H8896]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      UNRECOVERED GOLD IN THE GULF

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Texas (Mr. Poe) is recognized for 5 minutes.
  Mr. POE. Mr. Speaker, down in the depths of the warm waters of the 
Gulf of Mexico lies some old Spanish galleon with unrecovered gold, but 
there is another type of gold in the bottom of the Gulf of Mexico, 
black gold. We call it crude oil. There is also white gold there as 
well. We call it natural gas.
  These natural gold reserves are energy for today's Americans and we 
need to drill for these gold reserves. According to the Department of 
Energy, families across the United States will experience winter 
heating bills that will be up to 50 percent higher for those who heat 
with natural gas. This alarming data is yet another reason for us to 
open up the Outer Continental Shelf and begin drilling for more natural 
gas and oil off our own coastlines.
  The so-called global warming will not keep Americans warm this 
winter. We have got to become more self-sufficient when it comes to 
energy, natural gas and crude oil. It borders on the absurd to continue 
to be held hostage by foreign countries and foreign oil and ignore the 
billions of barrels that have yet to be drilled off the United States 
coastline.
  Mr. Speaker, I have introduced H.R. 3811 to help relieve our energy 
woes and help stop U.S. dependence on foreign oil. This legislation 
will allow for safe oil and natural gas exploration along the Outer 
Continental Shelf. This bill would do away with all the moratoriums and 
executive orders that limit leasing activities while maintaining 
environmental.
  Right now 90 percent of our coastline is off limits to drilling 
because the Federal Government prohibits it. In this chart, Mr. 
Speaker, I show the three places off the coast of Texas, Louisiana and 
Mississippi where we drill. All the red here, these are sacred places 
where we cannot drill for oil. Maybe Texas, Louisiana and Mississippi 
ought to join OPEC.
  In any event, Mr. Speaker, we have got to drill off these other areas 
because there is oil and there is natural gas in these areas off our 
Outer Continental Shelf.
  It is a myth, Mr. Speaker, that we cannot drill offshore safely. The 
best experts in the world are from the United States and they know how 
to drill safely. It is a myth perpetrated on the American people by 
environmental extremists. No one wants polluted waters. I certainly do 
not, but we can have both safe drilling and environmentally correct 
drilling as well.
  Let us look at some of the facts, Mr. Speaker. This chart shows 
pollution from oil, crude oil. Most of the pollution that is in our 
oceans comes from nature itself, from seepage on the bottom of the 
ocean. About 63 percent comes from nature; 32 percent comes from jet 
skis and oil runoff from American soil; 3 percent comes from those 
tankers that are bringing crude oil in from the Middle East; and way 
down here 2 percent of the pollution of crude oil comes from offshore 
drilling. It is a myth to think that we cannot drill offshore in a 
correct, an environmentally correct way.
  The National Academy For Sciences has furnished this information. The 
American public needs to know the truth about offshore drilling. If 
coastlines like Florida are worried about the environmental threats, 
maybe they should stop people from using jet skis and boating because 
more than a quarter of the spills come from just that. But maybe we 
should do some research.
  According to the Department of Interior, since 1985 more than 7 
billion barrels of oil were produced in Federal offshore waters, with 
less than .001 percent spilled. That is a 99.99 percent record for 
clean operations. My Jeep leaks more oil than this.
  Katrina and Rita hit the coastline very hard, Mr. Speaker. There were 
high winds, billions of dollars in damages, refineries were closed, but 
we did not hear anything about oil spills from offshore rigs that were 
damaged. Why? Because it cannot occur. Even those violent ladies of the 
gulf could not get a good oil spill to happen.
  People in these coastal States want cheap gasoline. They want natural 
gas, but they say do not drill off our coastlines. Mr. Speaker, this is 
hypocritical and it violates common sense. Plus, leasing these reserves 
will bring money to the United States Treasury and to State 
governments.
  If Americans expect to continue driving and heating their homes at 
low prices, we must begin safe drilling in other places besides the 
gulf. Economies on the coast rely heavily on tourism and they voice 
concerns about the so-called environmental impact. Mr. Speaker, if fuel 
costs continue to rise, the planes and automobiles will be used less 
and these tourists will never show up at these coastal places. It seems 
like the consequences of higher gas prices could have a worse impact 
than an innocent oil rig that is 100 miles off the coast.
  Around the world nearly every other major country with oil and gas 
reserves is promoting investment and developing their offshore 
capacity. They

[[Page H8895]]

even drill in the North Sea, the roughest waters in the world, and they 
do so safely.
  Mr. Speaker, we need to continue to explore the Outer Continental 
Shelf or we will suffer the consequences. Someone has said we will 
freeze in the dark and end up riding bicycles if we do not use common 
sense. Mr. Speaker, that is just the way it is.

                 National Ocean Industries Association


             Basic Facts About Offshore Oil and Natural Gas

       U.S. offshore energy production is an essential component 
     of the nation's energy and economic security. U.S. offshore 
     development accounts for more than 25 percent of the 
     country's natural gas and more than 30 percent of its oil. 
     Each year, offshore energy development contributes between $4 
     and 6 billion in revenues to the federal Treasury. Millions 
     are also paid to states and local communities. The federal 
     offshore produces approximately 600 million barrels of oil 
     and about 4.5 trillion cubic feet of natural gas annually.
       The U.S. offshore industry leads the world in developing 
     and commercializing advanced technologies that protect 
     sensitive environments and improve the quality of life for 
     all Americans. The U.S. offshore energy industry operates in 
     accordance with the world's most stringent standards for 
     human safety and environmental protection.
       Since 1985, more than 7 billion barrels of oil were 
     produced in federal offshore waters with less than 0.001 
     percent spilled--a 99.999 percent record for clean 
     operations. Government statistics show that the injury and 
     illness rate for offshore workers is about 70 percent lower 
     than for all of private industry. Thirty percent of the 15 
     million fish caught by recreational fishermen annually off 
     the coasts of Texas and Louisiana are caught near platforms. 
     Conservative estimates show annual catches of approximately 
     450,000 pounds of reef fish annually, valued at approximately 
     $2 million.


                           national benefits

     Producing America's Energy
       The submerged lands of the outer continental shelf (OCS) of 
     the United States have proved to be one of the most bountiful 
     sources of offshore oil and natural gas in the world. On a 
     per-day basis, the OCS currently produces about 13.9 billion 
     cubic feet of natural gas and about 1.3 million barrels of 
     oil. The federally managed OCS provides the bulk--about 89 
     percent--of all U.S. offshore production. Five coastal 
     states--Alaska, Alabama, California, Louisiana and Texas--
     make up the remaining 11 percent.
     Offshore Energy Revenues Enrich the Nation
       Between 1953 and 2002, the offshore energy industry has 
     contributed more than $145 billion to federal revenues. Most 
     of these revenues were derived from royalty payments that are 
     assessed on oil and natural gas produced from federal lands--
     typically one-eighth or one-sixth of oil and natural gas' 
     market value. Royalties, rents and bonus payments are 
     collected by the Minerals Management Service (MMS)--which 
     often results in that agency serving as the second largest 
     collector of federal revenues after the Internal Revenue 
     Service.
       Although most the revenues derived from offshore energy 
     activity are deposited directly into the federal Treasury, 
     these revenues are also the source of funds for the Land and 
     Water Conservation Fund and the National Historic 
     Preservation Fund. State and federal agencies use the Land 
     and Water Conservation Fund Act to buy parks and recreation 
     areas. Annually nearly $1 billion dollars in OCS revenues 
     flow to this program.
       Likewise, the National Trust for Historic Preservation has 
     received more than $2.5 billion in offshore energy proceeds 
     to help preserve historic legacies since 1982. Like the Land 
     and Water Conservation Fund, money from the National Historic 
     Preservation Fund is distributed to states whether or not 
     they have any offshore leasing or production seaward of their 
     coasts.
       Coastal states in producing areas also have a direct claim 
     on OCS revenues under Section 8(g) of the Outer Continental 
     Shelf Lands Act. For leases on the submerged lands lying 
     outside the 3-mile state zone and as far as 10 miles 
     offshore, 27 percent of the royalty, rent and bonus revenues 
     are paid directly to the adjacent states.
       States have used these funds for a variety of programs. 
     Alabama established the ``Forever Wild Program'' with 
     offshore leasing and production money to acquire, maintain, 
     and protect unique habitats. Mississippi has a similar ``Gulf 
     and Wildlife Protection Fund'' and Louisiana uses its money 
     for education.
     Employment
       The Gulf coast of Texas, Louisiana, Mississippi and Alabama 
     is the birthplace of offshore prospecting for oil and natural 
     gas, and the economic benefits of that development continues 
     to accrue to that region to the present day. There are more 
     than 85,000 jobs that are directly related to the industry, 
     and an equal number of workers employed in supporting jobs 
     indirectly related to OCS activity.
       The average salary and benefits for workers of producing 
     companies employed as a direct result of activity in the Gulf 
     of Mexico was estimated to be $52,580 in 1992. (The last year 
     for which statistics are available.) Since then, a shortage 
     of skilled labor due to the recent boom in industry activity 
     has pushed earnings even higher. In addition to payroll 
     expenditures, producers pay several billion dollars each year 
     to vendors and contractors who support OCS activities.


                  Safety and Environmental Performance

       The National Academy of Science's National Research Council 
     recently released the results of a comprehensive study 
     entitled, Oil in the Sea III: Inputs, Fates, and Effects. The 
     report finds that although the amount of oil produced and 
     transported on the sea continues to rise, improved production 
     technology and safety training of personnel have 
     significantly reduced both blowouts and daily operational 
     spills. In fact, the report states, today, accidental spills 
     from platforms represent only 2 percent of petroleum inputs 
     in U.S. waters and about 4 percent worldwide. Furthermore, 
     the MMS has found that most spills are quite small--with the 
     median being three barrels or less. Between 1971 and 2000, 41 
     percent of all spills were less than three barrels in size, 
     81 percent were less than 10 barrels, and 96 percent were 
     less than 100 barrels.
       The industry remains under intense scrutiny by its two 
     primary regulators--the MMS and the U.S. Coast Guard--as well 
     as a host of other governmental agencies with oversight 
     responsibilities such as the Environmental Protection Agency 
     and the National Oceanic and Atmospheric Administration. 
     However, it is the MMS that regulates all exploration, 
     development, and production activities on about 8,000 active 
     leases to ensure that these activities are conducted safely 
     and in an environmentally sound manner. The MMS reviews and 
     approves industry exploration and development plans before 
     allowing any operations to commence, monitors all lease 
     operations to ensure that industry is in compliance with 
     relevant requirements, and conducts scheduled and unscheduled 
     inspections. In 1997, MMS conducted over 12,000 inspections 
     of OCS facilities.


                     Innovation Boosts U.S. Energy

     The Deepwater
       Between 1996 and 1999, technological advances coupled with 
     economic incentives passed by Congress under the 1995 
     Deepwater Royalty Relief Act, encouraged energy companies to 
     acquire more than 2,600 leases in waters 800 meters or 
     greater pushing the total number of leases in the Gulf of 
     Mexico to more than 7,000.
       The number of deepwater exploratory wells drilled more than 
     doubled from 1996 to 1998, despite the limited number of rigs 
     that can work at such water depths and the decline in crude 
     oil prices during this time period. During that same period, 
     production from deepwater wells jumped 50 million barrels, 
     bringing total Gulf of Mexico deepwater oil production to 
     more than 570 million barrels in 2001--nearly a 535 percent 
     increase from 1995. By 2002, deepwater activity contributed 
     959,000 barrels of oil and 3.6 billion cubic feet of natural 
     gas per day to U.S. energy supplies--approximately 61 percent 
     of the Gulf's total production.
       Innovative technological leaps have enabled this thrust 
     into ever-deeper waters. Floating drilling rigs and 
     production platforms are now able to maintain position over 
     top of a well thousands of feet below without the need to 
     moor a fixed structure to the ground. Dynamic positioning 
     systems using computer-controlled directional propellers 
     compensate for wind, wave or current to keep the vessel 
     stationary relative to the seabed, while innovative hull 
     designs maintain stability even in ``hundred-year'' storms. 
     As a result, drilling is now taking place in waters more than 
     10,000 feet deep, an accomplishment that would have been 
     unimaginable just 20 years ago. Since 2001, industry has 
     announced 11 major discoveries in waters exceeding 7,000 
     feet.
     The Deep Shelf
       Trapped more than 15,000 feet within the earth's crust, so-
     called ``deep natural gas'' represents a tremendous untapped 
     domestic energy resource. Government studies estimate that 
     there could be more than 20 trillion cubic feet of untapped 
     deep natural gas deposits in the Gulf of Mexico--about as 
     much as is currently being produced from all areas in North 
     America on an annual basis!
       Annual gas production from Federal waters of the Gulf of 
     Mexico has exceeded additions to proved gas reserves every 
     year since 1984, causing a decreasing trend in remaining 
     proved gas reserves. New discoveries of deep gas on the OCS 
     offer the best short-term opportunity for achieving the 
     large reserve additions and necessary high flow rates to 
     offset declining gas production, which has been falling 
     since 1997. Recent deep gas discoveries on the OCS have 
     shown these new completions can produce as much 20 to 80 
     million cubic feet per day.
       Unfortunately, despite significant advances in deep gas 
     technology, these prospects remain very challenging to find 
     and develop successfully. Since 2001, Gulf natural gas 
     production has decreased from 5,128 BCF to 4,175 BCF in 2003. 
     Deep gas discoveries may help reverse this trend however: 
     deep gas production increased from a relatively low 284 
     billion cubic feet in 2000 to 421 billion cubic feet in 2002.
     New Life for the ``Dead Sea''
       As recently as the late 1980s, many experts agreed that oil 
     reservoirs in the Gulf were drying up. With oil and natural 
     gas output slackening, some dubbed the Gulf of Mexico

[[Page H8896]]

     the ``Dead Sea''. However, leading edge technologies breathed 
     new life into the Gulf--technologies that have enabled more 
     efficient exploration in deeper waters and production from 
     the deepest recesses of the earth's crust. Now the Gulf is 
     widely recognized to be among the most promising areas in the 
     world and oil production levels have increased sharply every 
     year since 1996.
       Leading edge offshore technology helps the country to find 
     and produce the energy to heat our homes, fuel our cars, run 
     our computers and drive the economy in faster, safer, cleaner 
     and more efficient ways than ever thought possible. These 
     innovations began with the natural gas and oil industry but 
     they enrich the lives of all Americans. As the leading 
     technological laboratory in the oil industry, the Gulf's 
     transformation provides an interesting snapshot of the 
     advances that have reverberated around the world and helped 
     to keep energy abundant, affordable and clean.

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