[Congressional Record Volume 164, Number 158 (Tuesday, September 25, 2018)]
[House]
[Pages H8792-H8794]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STRATEGIC PETROLEUM RESERVE REFORM ACT
Mr. BARTON. Madam Speaker, I move to suspend the rules and pass the
bill (H.R. 6511) to authorize the Secretary of Energy to carry out a
program to lease underutilized Strategic Petroleum Reserve facilities,
and for other purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 6511
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Strategic Petroleum Reserve
Reform Act''.
SEC. 2. USE OF UNDERUTILIZED STRATEGIC PETROLEUM RESERVE
FACILITIES.
Section 168 of the Energy Policy and Conservation Act (42
U.S.C. 6247a) is amended to read as follows:
``SEC. 168. USE OF UNDERUTILIZED FACILITIES.
``(a) Authority.--Notwithstanding any other provision of
this title, the Secretary may establish and carry out a
program to lease underutilized Strategic Petroleum Reserve
storage facilities and related facilities to the private
sector, or a foreign government or its representative.
Petroleum products stored under this section are not part of
the Strategic Petroleum Reserve.
``(b) Protection of Facilities.--Any lease entered into
under the program established under subsection (a) shall
contain provisions providing for fees to fully compensate the
United States for all related costs of storage and removals
of petroleum products (including the proportionate cost of
replacement facilities necessitated as a result of any
withdrawals) incurred by the United States as a result of
such lease.
``(c) Access by the United States.--The Secretary shall
ensure that leasing of facilities under the program
established under subsection (a) does not impair the ability
of the United States to withdraw, distribute, or sell
petroleum products from the Strategic Petroleum Reserve in
response to an energy emergency or to the obligations of the
United States under the Agreement on an International Energy
Program.
``(d) National Security.--The Secretary shall ensure that
leasing of facilities under the program established under
subsection (a) to a foreign government or its representative
will not impair national security.
``(e) Deposits of Amounts Received.--
``(1) In general.--Except as provided in paragraph (2),
amounts received through the leasing of facilities under the
program established under subsection (a) shall be deposited
in the general fund of the Treasury during the fiscal year in
which such amounts are received.
``(2) Costs.--The Secretary may use for costs described in
subsection (b) (other than costs described in subsection
(f)), without further appropriation, amounts received through
the leasing of facilities under the program established under
subsection (a).
``(f) Preparation of Facilities.--The Secretary shall only
use amounts available in the Energy Security and
Infrastructure Modernization Fund established by section 404
of the Bipartisan Budget Act of 2015 for costs described in
subsection (b) of this section that relate to addition of
facilities or changes to facilities or facility operations
necessary to lease such facilities, including costs related
to acquisition of land, acquisition of ancillary facilities
and equipment, and site development, and other necessary
costs related to capital improvement.''.
SEC. 3. PILOT PROGRAM TO LEASE STRATEGIC PETROLEUM RESERVE
FACILITIES.
(a) In General.--Part B of title I of the Energy Policy and
Conservation Act (42 U.S.C. 6231 et seq.) is amended by
adding at the end the following:
``SEC. 170. PILOT PROGRAM TO LEASE STORAGE AND RELATED
FACILITIES.
``(a) Establishment.--In carrying out section 168 and not
later than 180 days after the date of enactment of the
Strategic Petroleum Reserve Reform Act, the Secretary shall
establish and carry out a pilot program to make available for
lease--
``(1) capacity for storage of up to 200,000,000 barrels of
petroleum products at Strategic Petroleum Reserve storage
facilities; and
``(2) related facilities.
``(b) Contents.--In carrying out the pilot program
established under subsection (a), the Secretary shall--
``(1) identify appropriate Strategic Petroleum Reserve
storage facilities and related facilities to lease, in order
to make maximum use of such facilities;
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``(2) identify and implement any changes to facilities or
facility operations necessary to so lease such facilities,
including any such changes necessary to ensure the long-term
structural viability and use of the facilities for purposes
of this part and part C;
``(3) make such facilities available for lease; and
``(4) identify environmental effects, including benefits,
of leasing storage facilities and related facilities.
``(c) Report.--Not later than 1 year after the date of
enactment of the Strategic Petroleum Reserve Reform Act, the
Secretary shall submit to Congress a report on the status of
the pilot program established under subsection (a).''.
(b) Conforming Amendment.--The table of contents for the
Energy Policy and Conservation Act is amended by adding after
the item relating to section 169 the following:
``Sec. 170. Pilot program to lease storage and related facilities.''.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Texas (Mr. Barton) and the gentleman from New Jersey (Mr. Pallone) each
will control 20 minutes.
The Chair recognizes the gentleman from Texas.
General Leave
Mr. BARTON. Madam Speaker, I ask unanimous consent that all Members
have 5 legislative days to revise and extend their remarks and insert
extraneous materials in the Record on this bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mr. BARTON. Madam Speaker, I yield myself such time as I may consume.
Madam Speaker, in 1995, President Ford signed a bill to ban the sale
of crude oil overseas. Two years ago, we repealed that ban, and, last
month, we were exporting some days 3 million barrels of oil per day.
{time} 1545
We have gone from a nation that was importing up to 80 percent of our
oil to a nation that, today, if we absolutely had to, could be totally
energy independent.
Because of the Arab oil embargo in the early 1970s, a little before
President Ford signed the bill that said you couldn't export crude oil,
we established a Strategic Petroleum Reserve. The idea was that we
wanted to store oil in underground caverns--crude oil--so that, if
there were another supply disruption, we would have the crude oil even
if the OPEC cartel cut off oil shipments to the United States.
We have authorized up to a billion barrels of crude oil in this
reserve, and there is currently a little under 700 million barrels.
But, Madam Speaker, we don't need 700 million barrels of crude oil
today because, as I have just pointed out, when we allowed crude oil to
be exported, we unleashed a drilling boom in the United States that has
driven our oil production on a daily basis from around 6 million
barrels of oil per day to, this past month, 11 million barrels of oil
per day.
So, hence, the idea embodied in H.R. 6511, cosponsored by my good
friend from Chicago, Democrat Bobby Rush. It is pretty
straightforward.
We have quite a bit of excess capacity right now in the Strategic
Petroleum Reserve. We have authorized the sale of about 300 million
barrels between now and 2028. If that oil is actually sold, we will
have almost half of the SPR without any crude oil in it. So why not set
up a program and authorize the Department of Energy to put that vacant
space up for bid?
Oil producers all over the United States are scrambling for ways to
store all the oil that we are producing while it is waiting to be
refined or shipped overseas.
This is not a mandatory program. We are not mandating that the
private sector has to lease the space. What we are saying is, if the
private sector wants to negotiate with the Strategic Petroleum Reserve
managers, and it is a good deal for both sides, they can.
We currently--now, this number may not be exactly right, Madam
Speaker, but we spend about $200 million a year, I believe, to store
the oil that we are storing in the reserve, that is owned by the
taxpayers.
If you have vacant space and you allow the private sector to use that
vacant space and you charge whatever the market rate is for the private
sector to put oil in the reserve for a short term, those funds will
offset the cost of storing the government-owned oil. They will also
offset the cost of maintaining the reserve, and they will offset the
cost of improving the Strategic Petroleum Reserve.
Again, this is not a mandatory program, so we believe that this bill,
H.R. 6511, is a win-win. It helps the taxpayers because it might
generate some revenue that could be used to offset the cost of
maintaining the reserve as it exists. It might save the private sector
some money if they decide to utilize it.
And it might--and I would say, probably will--make our energy sector
more efficient because the private sector, should they choose to
participate in this program, doesn't have to go out and build above-
ground storage and maintain the above-ground storage. They can use the
existing capacity that has already been hollowed out on the Gulf Coast
of the United States that is very conveniently located adjacent to our
refineries and/or to our export terminals; and that will, overall,
lower costs of the whole system and end up being a win for the consumer
both in the United States and overseas. So I would hope that, when the
time comes later today, we will pass this unanimously.
I want to thank, again, my original Democratic sponsor, Congressman
Rush of Chicago, Illinois. I want to thank the subcommittee chairman,
Fred Upton of Michigan; the full committee chairman, Greg Walden of
Oregon; and the full committee ranking member, who is on the floor, Mr.
Pallone of New Jersey.
We have all worked on a bipartisan basis to pass this, and we think
that is why we have put it on the suspension calendar.
As you know, Madam Speaker, suspension bills have to get a two-thirds
vote, and I am hoping that this bill gets a 100 percent vote. It is a
good bill. It is a win-win.
Madam Speaker, I reserve the balance of my time.
Mr. PALLONE. Madam Speaker, I yield myself the balance of my time.
Madam Speaker, I rise in support of H.R. 6511, the Strategic
Petroleum Reserve Reform Act. This bill would set up a pilot program to
facilitate the leasing of unused storage space in the Strategic
Petroleum Reserve, or SPR, while attempting to ensure that the
government and taxpayers benefit from these leases. This is a worthy
cause, and I commend Representatives Barton and Rush for their efforts.
In recent years, Congress has turned to the SPR repeatedly as an
offset for deficits, transportation funding, and other items. In fact,
it has been used far more in recent years for those purposes than for
energy security. And these SPR sales, which will occur over the next
several years, will free up a great deal of physical space in the
reserve. This bill puts that empty space to good use.
The bill is part of our committee's ongoing efforts to modernize the
SPR. Going forward, we need to rethink its whole structure, including
exploring the authorization of regional refined product reserves.
Today, there are two regional supply reserves, both serving the
Northeastern States: The Northeast Home Heating Oil Reserve and the
Northeast Gasoline Supply Reserve.
The Northeast Home Heating Oil Reserve was created by our committee
in the Energy Act of 2000; and the Northeast Gasoline Supply Reserve
was created by President Obama and Energy Secretary Moniz in the wake
of Hurricane Sandy, using authorities provided to the Secretary in
section 171 of the Energy Policy and Conservation Act.
President Trump has proposed eliminating the Northeast Gasoline
Supply Reserve, and I think that is a mistake. I remain committed to
authorizing the existing gasoline reserve in statute, and I am
convinced that regional reserves are a critical component of any SPR
modernization effort.
Madam Speaker, I believe other regions should benefit, or could
benefit greatly, from having a refined product reserve. This is
particularly true for the Southeast, which is extremely supply
constrained. A Southeast regional reserve could provide relief and
flexibility in the event of a natural disaster in the region itself or
in the Gulf States that supply the Southeast region with refined
product.
Now, expanding the number of regional reserves is something that we
must do in the future, but I believe this legislation is a good step
forward on
[[Page H8794]]
the road to SPR modernization, and so I do urge my colleagues to
support this bill.
Madam Speaker, I yield back the balance of my time.
Mr. BARTON. Madam Speaker, I yield myself the balance of my time.
Madam Speaker, I have been in Congress for 34 years. I am about to
retire at the end of this session. I have been on the House floor with
many tumultuous battles. I have watched the fight over the Keystone
pipeline, drilling in ANWR up in Alaska. My good friend, Senator Markey
of Massachusetts, when he was in the House, would come to the floor
with his chart, an oil well drilling into the Social Security trust
fund.
It is refreshing, Madam Speaker, to be on the floor today in the
spirit of bipartisanship where we are all for something which I think
really is good for the American people, good for the taxpayer, and good
for the consumer.
This is on suspension, so, obviously, we have to have a huge vote. I
hope we get it. It looks like we will since we don't have any other
speakers.
I would urge a ``yes'' vote, Madam Speaker. Let's do something good
for America. Let's vote for this bill. Please vote ``yes'' on H.R. 6511
when the vote is called.
Madam Speaker, I yield back the balance of my time.
Mr. WALDEN. Madam Speaker, I rise in support of H.R. 6511, the
Strategic Petroleum Reserve Reform Act. This bill is another product of
the Energy and Commerce Committee's ongoing and bipartisan work to
modernize the Department of Energy.
The Committee's DOE modernization efforts are focused on ensuring the
Department can more ably address current and future domestic and
international energy and security challenges. These challenges range
from maintaining nuclear safety and security to protecting the reliable
supply and delivery of energy, and they require a DOE that has the
appropriate organization, management focus, and authorities to succeed.
H.R. 6511 was developed by Vice Chairman Barton and Ranking Member
Rush to modernize the forty-year-old Strategic Petroleum Reserve, so
it's prepared to protect our Nation from energy disruptions in the
decades ahead.
H.R. 6511 authorizes DOE to lease underutilized storage capacity,
which will become available in increasing amounts as DOE conducts
mandated drawdowns over the next several years. Rather than have DOE
maintain empty caverns at considerable taxpayer expense, H.R. 6511 will
allow DOE to develop the spare capacity, attracting much needed capital
investments for additional improvements. H.R. 6511 will preserve the
SPR's existing capacity, generate revenue for upgrades and maintenance,
and improve the operational readiness of the entire SPR complex. H.R.
6511 is truly a win-win, and a perfect example of our bipartisan DOE
modernization effort.
I especially want to thank Mr. Barton for his work on this bill. He
has been at the forefront of so many defining moments relating to
energy security. From his leadership as Chairman of the Energy and
Commerce Committee during passage of the Energy Policy Act of 2005, to
his tireless efforts to repeal the ban on crude oil exports, his work
on this bill contributes to the great legacy he leaves behind at the
Energy and Commerce Committee--and in the United States Congress. I
urge my colleagues to join me in supporting H.R. 6511.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Texas (Mr. Barton) that the House suspend the rules and
pass the bill, H.R. 6511, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
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