[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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