[Congressional Record (Bound Edition), Volume 146 (2000), Part 13]
[Senate]
[Pages 18707-18708]
[From the U.S. Government Publishing Office, www.gpo.gov]



                      STRATEGIC PETROLEUM RESERVE

  Mr. MURKOWSKI. Mr. President, I rise today to call the attention of 
my colleagues to an urgent matter, and that is the reauthorization of 
the Strategic Petroleum Reserve. The legislation is sitting here today 
and awaits clearance. It is contained in the Energy Policy and 
Conservation Act, or EPCA.
  We have a hold on the passage of EPCA, which contains the Strategic 
Petroleum Reserve reauthorization. Also in the EPCA package is the 
Northeast home heating oil reserve. I know this is of great interest to 
Members from the Northeast, who are concerned, legitimately, about the 
potential of higher prices for home heating oil this fall and this 
winter, particularly if we should have a very cold winter.
  The White House, the Secretary of Energy, has pleaded with Congress 
to pass EPCA, including the Strategic Petroleum Reserve 
reauthorization. I am chairman of the Energy and Natural Resources 
Committee. We passed a companion measure out of this committee. Now 
EPCA waiting on the floor. An effort was made last night to clear it. 
The administration claims it is an emergency that they have the 
reauthorization. They are contemplating going into the SPR and taking 
oil out of it to try an address this crisis. The merits of that deserve 
additional consideration by this body.
  I will just share this observation on the logic of such a move. SPR 
is a reserve, it holds about a 50-day supply of oil, which is to be 
used in the case of emergency disruption of our foreign oil. Currently 
our dependence on foreign oil amounts to about 58 percent of our 
consumption. However, because of the high prices and the inadequacy of 
our refining industry, we are facing a train wreck relative to energy 
prices, gasoline, diesel, and other petroleum products. If it seems I 
am being a little ambitious in citing the critical nature of this 
crisis, let me tell you that the Government of Great Britain and Prime 
Minister Tony Blair find it a real issue relative to the stability and 
continuity of that Government.
  The responses we have seen in Germany, England, Poland, and other 
countries to the increasing price of energy and what it means to the 
consumer is not only of growing concern, but it has reached a crisis 
mentality. During this country's last energy crisis, we had our 
citizens outraged. It was in 1973 when the oil embargo associated with 
the production from OPEC--it was called the Arab oil embargo--hit this 
country. We had gas lines around the block. People were mad, outraged, 
indignant. At that time, we were only 37-percent dependent on imported 
oil. Today, we are 58 percent. The Department of Energy contemplates we 
might be as high as 63 or 64 percent in the not too distant future.
  The oil price yesterday was the highest in 10 years, more than $37 a 
barrel. There are those who predict it is going to go to $40 a barrel. 
Here we have the reauthorization of the Strategic Petroleum Reserve, at 
the request of the administration, being held up by a Member on the 
other side of the aisle. There may be other reasons the Senator has 
seen fit to put a hold on this legislation.
  I certainly would be happy to debate one of the issues that concerns 
activity in my State. It is the measure that allows power plants 
smaller than 5-

[[Page 18708]]

megawatts to be licensed through a state procedure in Alaska. It would 
allow our Native people in rural areas to have clean, renewable energy 
rather than the high-cost diesel power they now burn.
  I want to tell my colleagues, the Native people in Alaska really need 
this exemption. This is utilizing the renewable resource; namely, 
rainwater, snowfall. The inability of these small projects to support 
the cost of a Federal energy regulatory relicensing procedure--which is 
appropriate for large-scale projects--makes it absolutely beyond the 
capability of these small villages to utilize renewable resources 
associated with a 5 megawatt powerplant generated by water power.
  I do not know whether there is an objection on the royalty-in-kind 
provision. No other Senator has indicated an objection, nor has the 
administration. It is hard to understand an objection when the 
provision simply says that the Secretary of the Interior may accept gas 
and oil in lieu of cash payments. The Department of the Interior has 
that power now and is using it in pilot projects.
  The provision allows the Secretary more administrative flexibility to 
actually increase revenues from the Government's oil and gas royalty-
in-kind program. Under current law, the Government has the option of 
taking its royalty share either as a portion of production--usually 
one-eighth or one-sixth--or its equivalent in cash.
  Recent experiences with the MMS's royalty-in-kind pilot program has 
shown that the Government can increase the value of its royalty oil and 
gas by consolidation and bulk sales. Under royalty-in-kind, the 
Government controls and markets its oil without relying on its lessees 
to act as its agent. This eliminates a number of issues that have 
resulted in litigation in recent years and allows the Government to 
focus more directly on adding value to its oil and gas.
  I would hope my appeal results in the administration, the Secretary 
of Energy, and others who believe very strongly that EPCA should be 
passed, including the reauthorization of the Strategic Petroleum 
Reserve. This action is especially timely, when indeed this country 
faces a crisis in the area of oil. I think the merits of the President 
having this authority at a time when we contemplated an emergency 
suggests the immediacy of the fact that this matter be resolved and 
addressed satisfactorily. We should adhere to the plea of the President 
to reauthorize SPR. I want the Record to note it is certainly not this 
side of the aisle that is holding this matter up. I would suggest it be 
directed by the appropriate parties to get clearance so we can pass 
EPCA out of this body.

                          ____________________