[Congressional Record Volume 157, Number 175 (Wednesday, November 16, 2011)]
[Senate]
[Pages S7596-S7598]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 ENERGY AND WATER DEVELOPMENT AND RELATED AGENCIES APPROPRIATIONS ACT, 
                                  2012

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of H.R. 2354, which the clerk will 
report.
  The bill clerk read as follows:

       A bill (H.R. 2354) making appropriations for energy and 
     water development, and related agencies for the fiscal year 
     ending September 30, 2012, and for other purposes.

  Pending:

       Reid amendment No. 957, in the nature of a substitute.
       Reid amendment No. 958 (to amendment No. 957), to change 
     the enactment date.
       Reid amendment No. 959 (to amendment No. 958), of a 
     perfecting nature.
       Reid amendment No. 960 (to language proposed to be stricken 
     by amendment No. 957), to change the enactment date.
       Reid amendment No. 961 (to amendment No. 960), of a 
     perfecting nature.
       Reid motion to recommit the bill to the Committee on 
     Appropriations, with instructions, Reid amendment No. 962, to 
     change the enactment date.
       Reid amendment No. 963 (to (the instructions) amendment No. 
     962), of a perfecting nature.
       Reid amendment No. 964 (to amendment No. 963), of a 
     perfecting nature.

  The ACTING PRESIDENT pro tempore. The Senator from California.
  Mrs. FEINSTEIN. Madam President, it is my understanding that Senator 
Bingaman would like to speak on an amendment he has filed and Senator 
Murkowski may well come down to speak on that, which is fine.
  I will yield to Senator Bingaman to do that now.
  The ACTING PRESIDENT pro tempore. The Senator from New Mexico is 
recognized.
  Mr. BINGAMAN. Madam President, I appreciate the opportunity to speak 
briefly about an amendment Senator Murkowski and I have filed.
  There is a provision in the Energy and Water appropriations bill, 
which we are considering in the Senate, that we would like to see 
stricken or deleted from the bill. It is a provision in the legislation 
that mandates the sale of $500 million worth of oil from the Strategic 
Petroleum Reserve, or SPR, as it is called. The bill also ends the 
Royalty-in-Kind Program. That part I am not disputing at this point.
  The language in the bill that we are concerned about is on page 41. 
It says in that part of the bill:

       Notwithstanding various other provisions, the Secretary of 
     Energy shall sell $500 million in petroleum product from the 
     reserve not later than March 1 of 2012, and shall deposit any 
     proceeds from such sales in the general fund of the Treasury.

  In the words of the Department of Energy:

       The Strategic Petroleum Reserve exists, first and foremost, 
     as an emergency response tool the President can use should 
     the United States be confronted with an economically 
     threatening disruption in oil supplies.

  The SPR is our Nation's insurance policy against oil supply 
disruptions, and keeping it well stocked and operational is important 
to our energy security. I believe that is a view shared by Democrats 
and Republicans.
  The SPR became filled to its maximum capacity of roughly 727 million 
barrels for the first time in its history in the year 2009.
  The President, in the budget he submitted--the 2012 budget--proposed 
a sale of oil from the SPR that would generate $500 million in revenue 
for the Federal Treasury. The administration explained that because the 
SPR was at maximum capacity, it needed to sell off some oil for 
operational purposes. They needed extra space in the SPR in order to 
move oil around within the system and to refurbish some of the 
underground salt caverns in which the oil is stored.
  However, this past June, there was an emergency drawdown, and there 
was a sale of 30 million barrels of SPR oil. I understand that the 
emergency sale generated more than $3 billion. This indicates to me 
that more than six times the amount of oil that the President thought 
was necessary to be sold for operational reasons has now been sold.
  Clearly, the President's proposal from February to create a little 
free space in the SPR is no longer necessary. The concern we have is 
that the SPR sale provision in this legislation remains part of an 
appropriations bill,

[[Page S7597]]

and the sale is no longer necessary for operational purposes; it is 
simply a way of generating revenue.
  I hope my colleagues will consider the long-term implications of 
using our strategic oil stocks just to generate revenue for the 
operation of government on a weekly and monthly basis. I believe this 
is a bad precedent. I believe we should reject this part of the 
legislation, and if the opportunity presents itself to offer the 
amendment, I will urge our colleagues to join us in deleting this 
provision and ensuring that future revenue-generating sales of SPR oil 
not be accomplished or proposed simply to pay the ordinary operating 
bills of the various agencies covered by the legislation.
  I know my colleague from Alaska is expected to come to the floor in 
the next few minutes and give her views on this same legislation that 
she and I are cosponsoring, the amendment I have just spoken about. 
Until then, I yield the floor and suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mrs. FEINSTEIN. Madam President, I ask unanimous consent that the 
order for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mrs. FEINSTEIN. Madam President, I thank Senator Bingaman for his 
comments. He has been an excellent chair of the committee.
  It is our understanding that these points were never brought to the 
committee. However, I am told the Energy Department has told my staff 
that the budget request is valid due to the Department's need for 
operational flexibility.
  I want everybody to know that the floor is open. If you filed an 
amendment, please come down to speak on it. If you want to file one, 
please do so as quickly as possible. The floor is open for amendments.
  I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Ms. MURKOWSKI. Madam President, I ask unanimous consent that the 
order for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Ms. MURKOWSKI. Madam President, I have come to the floor this morning 
to discuss a provision in the Energy and Water appropriations bill that 
apparently Senator Bingaman has just spoken to. This would require the 
sale of $500 million worth of oil from our Nation's Strategic Petroleum 
Reserve or we call it the SPR. I do believe this is an inappropriate 
use of our limited emergency stockpiles, and I think it would also set 
a dangerous and an unsustainable precedent for the future.
  As I understand it, the administration first requested this sale in 
its fiscal year 2012 budget proposal and justified it by asserting 
there was an integrity issue in one of the caverns where the SPR oil 
was stored. We heard this discussion before the Energy Committee some 
months ago. He asserted the sale was necessary because DOE had to drain 
the oil in that cavern to perform some repairs that were apparently 
necessary.
  The House Appropriations Committee subsequently authorized the sale 
in its version of the bill which was then released in June. At that 
point in time, based upon DOE's representation, I guess it was kind of 
hard not to argue the sale was not justified. But then events took a 
different course. Several weeks later, as part of a coordinated effort 
with the IEA to increase global supplies, the President chose to sell 
about six times more crude from the SPR than the House had originally 
contemplated.
  Whether one supported that sale or not, I think it would have been 
reasonable to assume or to expect the administration would sell the 
crude from the cavern that needed the repairs. They needed to get that 
out so they could do the necessary repairs. So when an unannounced sale 
comes along, one would think they would take the oil from that cavern, 
thereby solving at least one of the problems and obviating the need of 
a future maintenance-related sale. Enough oil has now been sold from 
our emergency reserves to fill not one but six troubled caverns.
  The only justification that can remain now is the need for more cash. 
We need more money. Given that background, I would encourage the Senate 
to consider that selling $500 million worth of our emergency oil 
reserves right now simply to help offset other appropriations is akin 
to cashing out our insurance policy in order to cover the cost of a 
mortgage we can't afford in the first place.
  The SPR was designed to be that emergency safety net, if you will, or 
like an insurance policy. Remember, there is a very good reason why we 
have this insurance policy in the first place. Congress created the SPR 
in the aftermath of the oil embargo back in the 1970s to serve as a 
safety net in the event we were to see a major supply disruption. Given 
the volatility that continues to churn the global markets, our 
strategic stockpile is arguably more important today than ever before. 
As long as we maintain a large volume of oil within the SPR, we will 
ensure Americans have some level of protection against future 
disruptions. If we decide not to take the long view, we face the very 
real risk of being forced to spend more tomorrow to repurchase the oil 
that is being sold today.
  One may ask: How likely is any kind of a future disruption? I would 
say the odds are still higher than we would like. Our Nation remains 
roughly 50 percent dependent on foreign oil, importing close to 9 
million barrels a day at the cost of hundreds of billions of dollars a 
year. The world, as we know, is not exactly stable. Large volumes of 
Libyan oil remain offline. Iran continues to provoke its neighbors, 
raising the specter of future attacks. Saudi Arabia's leadership is 
aging rapidly, leaving the door open to perhaps future unrest and 
upheaval. China, India, and many of the other countries are rapidly 
expanding their oil consumption and, in the meantime, forging close 
relationships with major suppliers that can be leveraged in times of 
emergency.
  Here at home, the Federal Government continues to hinder the 
development of new supplies that would improve our energy security and 
reduce the need for a strategic reserve. We have seen development 
halted or delayed in Alaska in the northern part of the State, in the 
Rocky Mountain West, and a number of other areas. The new 5-year 
leasing plan for offshore development does take a few small steps, but 
it keeps both the Atlantic and the Pacific coasts under a de facto 
moratorium through at least 2017. The administration has also delayed 
its decision on the Keystone XL pipeline. We just saw that news this 
week. This would have carried significant volumes of Canadian oil. 
Again, that is oil from an ally, from a neighbor, that would have 
brought that into this country.
  The result is, we are not doing, in my opinion, nearly enough to 
reduce our dependence on foreign oil, so we still need a Strategic 
Petroleum Reserve, and we cannot treat it as a national ATM that can be 
tapped when the money is tight. That is not the reason we should have 
or the way to utilize the SPR.

  I wish to share a quote from a witness who testified before the 
Energy Committee earlier this year. His name is Kevin Book. He is a 
real expert on energy policy, and I think he made quite an impression 
on our committee. He encouraged us to seek alternatives to petroleum, 
but he also said:

       Selling oil out of the Strategic Petroleum Reserve to pay 
     for efficiency gains and alternative fuels could seriously 
     diminish U.S. energy security without necessarily delivering 
     financial benefits.

  For anybody who might be interested, I am happy to provide a copy of 
his testimony. I think it was quite useful in understanding why this 
approach is not appropriate at this point in time.
  As we seek to pay for legislation that comes before us--whether it is 
this appropriations bill or something else--I continue to believe one 
of our best paths forward is to produce more of our own abundant 
resources and then put the resulting Federal revenues to good use. 
Instead of selling our emergency oil and risking future dilemmas, we 
should, instead, put policies in place that expand and that accelerate 
the pace at which we develop our immense natural resources.
  Right now, Alaska has about 40 billion barrels of oil that are just 
waiting

[[Page S7598]]

to be tapped for the good of the Nation. I keep saying we have money 
that is buried in the ground up there. If we harness those resources 
and more of the resources in the Gulf of Mexico and the Rocky Mountain 
West, we would be dramatically increasing our energy security, we would 
create tens of thousands of new jobs, and generate billions and 
billions of dollars year after year that could be applied to both 
deficit reduction and the development of new energy technologies.
  I would encourage the Senate to support any amendment that strikes 
the SPR provision in this bill and encourage us, instead, to focus on 
the development of a more viable long-term energy policy.
  With that, I yield the floor, and I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. SESSIONS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.

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