[Congressional Record (Bound Edition), Volume 161 (2015), Part 11]
[House]
[Pages 15916-15922]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       LIFTING BAN ON OIL EXPORTS

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 6, 2015, the gentleman from Texas (Mr. Conaway) is recognized 
for 60 minutes as the designee of the majority leader.
  Mr. CONAWAY. Mr. Speaker, I appreciate the leadership allowing me to 
visit with you about something that is near and dear to my heart. I 
hope we spend the better part of the next hour discussing a bill 
tomorrow that will be before this body, which is H.R. 702, which would 
lift the 40-year-old, decades-old ban on exporting a domestic product, 
a domestic commodity, called crude oil.
  As you look at the things that America buys and sells around the 
world, the only commodity that we produce here in the United States 
that we cannot export is crude oil. It harkens back to 40 years ago, 
and I will talk about it in a second.
  There are no restrictions on imports. You could import all the crude 
oil that you would like, but we have a restriction on exporting that 
crude oil.
  Now, the administration recently signaled a bit of a change in that 
in that they licensed a swap of certain number of barrels of heavy 
crude from Mexico for light sweet crude coming to the United States. So 
there was at least one opportunity recently where the Department of 
Commerce authorized that swap and, in effect, began to export some of 
this crude that we produce every single day.
  Forty years ago the Arab oil embargo and all the things that happened 
with that--most of the folks in this Chamber, except maybe you and I, 
don't necessarily recall the long lines at the gas station and the 
rationing and the way that even-numbered license plates were okay one 
day and odd-numbered license plates were okay the next day to buy 
gasoline.
  I can remember living in Dallas at the time. I would have to get up 
at 5 o'clock in the morning and go sit in line at a gas station in 
order to fill up the car so that I could make it downtown and back and 
forth. It was somewhat disruptive to our quiet lives.
  The price of oil went from $3 a barrel to $12 a gallon, a fourfold 
increase. That shock hammered the economy with a lot of things that 
were going on.
  As a part of that response, in addition to the response, just before 
the Arab oil embargo in the 1973-1974 timeframe, the United States had, 
through a secret study, determined that American crude oil production 
may have peaked in 1970 and that the wells in the United States that 
were then producing and the new ones that were going to be drilled and 
brought online--that the daily production in the United States would 
slowly decline from that point on and that that scarce resource of 
strategic value needed to stay here in the United States.
  So while we were even a net importer at that point in time, the 
wisdom of this House, the Senate, and the President at the time was: 
Let's just don't export any U.S. crude. Let's use all of it here. And 
then we will buy from other folks the crude oil that we need to make up 
the difference in our refinery loads.
  That held true for 35 years. Then something pretty stunning happened, 
and that was this incredible renaissance in the oil and gas business 
that has occurred over the last 5 years.
  When history writes about this era of the oil and gas business, it 
will talk about these incredible breakthroughs in technology and the 
science associated with it and the risk taking of the private sector.
  The current President likes to brag about the oil and increased 
production. Quite frankly, this has all come in the private sector, 
private lands, and private initiatives, where this has happened. 
Permitting on public property, public lands, has slowed down, and 
actual production off our Federal lands has shrunk from where it has 
been.
  So for 35 years it was a policy that was out there. It was never an 
issue because we didn't produce enough every day to export.
  Then about 5 years ago this process of increased production was 
driven by the shale oil play in the Bakken, the shale oil play in west 
Texas, and the shale oil play in the Eagle Ford shale in south Texas, 
big frac jobs, technologies that broke the rock up or allowed the oil 
to escape out of that rock in quantities heretofore not really 
contemplated or known.
  The oil was in the rock. Everyone knew that. They just didn't know 
how to get it out of the rock. This wonderful renaissance began to 
occur, and U.S. production began to increase every day to the point now 
that the estimates, had the price not dropped, were that, by 2020, we 
would be the largest exporter and that we would have an excess.
  So we already had a bit of an excess of crude oil in the United 
States because it had to go through U.S. refineries. U.S. refineries 
are set up to process heavy crude, which is not what is produced out of 
this oil shale. That is light, sweet crude. So, consequently, we had 
more light sweet. We are still importing crude every day from Venezuela 
and other countries that feed heavy crude into our refineries.
  So it got on everybody's radar screen that we need to figure out a 
way to unlock this market and eliminate the inefficiencies associated 
with not being able to export U.S. crude.
  As a result of that, there are two sets of prices in the world 
markets. There is a Brent price of crude, which is North Sea crude, and 
there is also a West Texas Intermediate price that is in the markets.
  There has been for a long time now a differential between those two 
prices. The West Texas Intermediate price, which is what our local 
American producers get, was less than the Brent crude.
  That differential was driven by the fact that we had no market for 
U.S. crude, other than U.S. refineries, given the laws and the 
restrictions that were in place. So the movement began to explore the 
opportunity for lifting this decades-long ban on crude oil.
  Throughout the years that Harry Reid was in charge of the Senate, it 
was a nonstarter because it was not likely we could get a bill like we 
are going to vote on tomorrow in the House through the Senate. With the 
Republican victory last November and control in the Senate by 
Republicans, it then became an opportunity for us to examine this 
policy and see if it makes sense.
  Just to set the record straight, even without the bad deal the 
President has foisted on us, we treat Iran better than we treat 
American producers. Because even before the sanctions are lifted in 
Iran, they can produce and export about a million barrels of crude oil 
a day. The U.S. is zero.
  So as you step back to look at the big picture, we treat Iran--with 
all the mischief they do and the bad actor they are and the threat to 
world peace that they are, they get better treatment than domestic 
producers, and that makes no sense whatsoever when you look at the 
overall issue.
  So we are at a point now where, with this drop in prices to almost 
half of what it was, we have begun to see that crude oil production 
will probably tail off here in the United States this quarter.
  But the oil is there. We know how to get it. The science is 
available. It is just simply driven by the price. Recovering the 
drilling and completion costs is what is causing the current decline in 
production, but we know where it is and how to go get it.
  When a well comes online, from day one, it will begin to produce less 
oil today than it did yesterday. That process, that decline, will move 
forward throughout the life of that well until it reaches its economic 
limit.
  The economic limit of a producing well is driven by the price versus 
how much it costs you to get it out of the ground, the taxes associated 
with the barrel, the royalties associated with it. Those have got to be 
in positive circumstances or it doesn't make any sense to produce that 
crude oil.
  In the drilling and the completion of a well, you have got to be able 
to recover that investment from the total number of barrels that you 
expect to produce out of that well. When you know those fixed costs 
going in, there are very few of those costs that are recoverable once 
you drill a well.

[[Page 15917]]

  Your only return is to sell the crude oil. And given how much you 
think that each well will produce, it has got to be at a price where 
you can recover that investment as well as cover your incremental costs 
each day of producing that crude oil.
  So there are some sound economic reasons why, at current prices of 
crude oil, there is less drilling going on and certainly less 
completions going on in the market.
  That oil is not going anywhere. That shale is just the way it was 
when the prices were a lot higher. So if prices were to recover and it 
made sense, then our American domestic producers could go back to 
producing more and would then reset that decline on an upward slope so 
that we are, in fact, producing more oil each day than we did yesterday 
because we are bringing on more wells every single day to offset the 
natural decline that each well will experience. While we have got this 
window of opportunity, it is time now to lift this crude oil ban.
  Mr. Speaker, I am joined by my neighbor, who represents the southern 
two-thirds of New Mexico. More importantly, he represents my three 
grandsons who live in Las Cruces, New Mexico. So I watch him like a 
hawk to make sure he is doing a good job representing my grandsons.
  I yield to the gentleman from New Mexico (Mr. Pearce).
  Mr. PEARCE. Mr. Speaker, I would like to bring to attention that we 
are engaged in a very important activity here. We are talking about 
American jobs.
  Now, some people dismiss jobs as being a four-letter word. Well, I 
mean it kind of is, but not that kind of four-letter word. It is an 
important piece.
  When I was born, my father was a sharecropper. In 1947, the year I 
was born, he made $200. The next year, the drought year, he made 50 
bucks.
  Mom said, ``We are leaving the farm.'' She jumped in the pickup 
truck. Dad jumped in the back, along with us kids. There were three 
kids at that time, later to become six.
  They headed to the West. I don't think they knew where they were 
going. I guess they would have stopped when they got to California. But 
they got 75 miles down the road and broke down 3 miles outside of 
Hobbs, New Mexico. They hitchhiked into Hobbs, and that is where I grew 
up.
  Dad was able to find a job almost immediately in the oilfield. He got 
in at the lowest level, a roustabout, making $2.62 an hour.
  Now, to them, to my family who had made $200 for a full year's work 
and $50 for the next year's work, $2.62 an hour was the absolute 
pinnacle.
  They never moved from Hobbs. They stayed there and raised their six 
children on $2.62 an hour. And, of course, it graduated through the 
years.
  That is why I am passionate about this export ban. Because right now 
we have people in my home county who are being laid off because our oil 
is sitting in the pipelines. The pipelines going to Houston are filled 
up. And so companies are having to shut down wells. They are having to 
stop production.
  Now, some of the countries in the Baltics have come to Eddy County, 
which is one of the counties I represent, and they have said, ``We 
would buy your light, sweet oil. That crude oil is better than what we 
buy from Russia. We would stop buying from Russia and buy from you,'' 
except we have this ban in place. We can't ship oil out of this 
country.
  Now, we have to understand that 95 percent of the world's consumers 
are outside the United States. So when we have this self-imposed 
problem, this self-imposed restriction on sending a product that is 
very needed out there, know that we are penalizing American jobs.
  The President has been very, very ardent in his willingness to create 
Iranian jobs because he insists that Iran should be able to export 
their oil while all the time saying that he is opposed to the idea of 
this bill.

                              {time}  1730

  We are going to consider this bill tomorrow, and I think in my heart 
that we are doing things that would benefit people like my parents, 
people who did not have the option to move to New York and be on Wall 
Street. They didn't have the option to move to Albuquerque or Dallas. 
They were where they could get to, and they were able to find work and 
raise a family. That is the people that I am fighting for, the people 
that don't have other choices.
  Now, the oilfield provides very good jobs. In this current energy 
revolution that is taking place in the country, this explosion of shale 
oil production, truck drivers in my hometown were receiving $100,000 a 
year to drive a truck. If you wanted to work overtime, you could get up 
to $120,000. That is the sort of job that is now available to people 
like my father. If he were still working, those jobs would be out 
there.
  But it is not just the people in the oil and gas industry. It is the 
people who work in the convenience store at the corner. They are busy 
24 hours a day, and the local convenience store operator may have to 
pay $15 an hour just to attract people in. It benefits everyone, 
regardless if they are in oil and gas or not.
  In New Mexico, oil and gas provides about 40 percent to our State's 
budget. I tell teachers on the other side of the State: With no oil and 
gas, you should be vitally interested in this export bill because, if 
we put people back to work in the oil industry, that money goes 
straight to the State government, and it helps pay your salary.
  Up and down the spectrum, people are benefited when we have a vital 
energy economy.
  If we are going to allow our light sweet crude to be exported, people 
wonder: Are we going to run out of energy? Absolutely not. It is not 
going to get more expensive.
  Back when my father was working for Humble, which later became Exxon, 
they had a company philosophy. They were the largest energy company in 
the world. They simply said this area, the Permian Basin here in New 
Mexico, is going to run out of oil in the late 1980s, so they sold 
every producing well in that area. They simply moved out.
  Just a couple of years ago, a discovery was made in southern New 
Mexico--keep in mind, some of the majors moved out, said there was no 
more future in this area; it is going to be out of oil--and a discovery 
was made that is going to produce more oil from that one field than has 
been produced in New Mexico through the whole of New Mexico in all of 
its history, from one field that was discovered recently.
  We have this kind of thing where people are saying, well, we have got 
to worry and we have got to think about the future and save it for the 
future. No, there is as much oil out there unused as we have used in 
New Mexico. So let us have New Mexico jobs. Let us continue to export 
now instead of allowing the oil to fill up the pipelines and shut down 
jobs. That is the main reason that I am supporting this.
  Obviously, I appreciate the fact that energy is national security. 
The low energy prices now are rebuilding the manufacturing economy. As 
we drive the price of oil down--and keep in mind that the consumers 
benefit from that. Gasoline had gotten to over $4. Now, then, it is 
right down in the $2 range. So it benefits the consumers.
  It is also attracting back industries that manufacture. That is 
essential for that kind of business. If you are going to manufacture, 
you need affordable, reliable energy. Firms are moving back here in 
order to produce. That is creating even other jobs that don't even seem 
associated with the energy business.
  So, again, you have many, many reasons for supporting this energy 
export bill, and I urge my colleagues to do that.
  Mr. CONAWAY. Mr. Speaker, I thank the gentleman from New Mexico for 
his thoughts and comments. He and I are blessed to share a group of 
people who work across that State line between Texas and New Mexico--
our districts are contiguous with each other--who live in one State, 
work in the other, vice versa, some of the hardest working, most 
dedicated, patriotic folks on the face of the Earth, like his dad and 
his mom who have built wealth, raised a family, protected that family, 
and produced a U.S. Congressman. It makes

[[Page 15918]]

them easy to talk about and easy to defend.
  I want to flush out this idea of the geopolitical aspects of lifting 
the ban. I was recently in a Baltic country in conversations with one 
of the top two leaders, and I had the chance to ask a question of the 
Prime Minister. I said: Mr. Prime Minister, if you could buy crude oil 
directly from the United States, would it make your issues with Putin 
and all the mischief and things he is up to less difficult to deal 
with?
  He lit up like a Christmas tree. He said: Oh, absolutely, absolutely. 
We would love to buy U.S. crude and not spend that money with Putin and 
Russia and help lift the boot--the Russian boot off their neck--that is 
driven by crude oil and natural gas.
  If they could supply to these countries that can't supply themselves, 
then there is absolutely no reason whatsoever that they shouldn't be 
running our light sweet crude through their refineries at this point in 
time.
  Steve talked about his dad. My dad was the same way in the sense that 
if rigs--he was a roughneck, and roughnecks are that hardy group of 
individuals who work on a drilling rig. It is dangerous. It is hard. It 
is 24 hours a day. They work 8-hour shifts.
  My dad would pull doubles in order to get the extra time and a half 
so the cash flow to the family would be enough to feed my brother, 
sister, me, and my mom. He lost a part of a finger as a part of that 
experience. If the rigs were running in Borger, Texas--we lived in 
Borger, Texas, where I was born. If the rigs were running in Odessa, 
Texas, we moved to Odessa, Texas, because my dad thought it was more 
important to have a job than necessarily where we lived because that 
was key.
  In the early 1990s, I was part of a group that did a needs assessment 
in Midland, Texas. And we sometimes lose sight of why jobs are 
important because we talk a lot about it. But that needs assessment did 
a scientifically sound, statistically sound survey of Midland, asking 
folks what are the issues within your home, what are the issues within 
your neighborhood, what are the issues within your community that have 
a problem, that create this problem? We then winnowed those down to the 
top 10.
  If you looked at that list of top 10 needs of Midland, Texas, at the 
time, 9 of those would have been positively impacted by somebody having 
a job. Whatever that need was, it was less of a problem if a family had 
a job than if they didn't have a job.
  The jobs that this will create, jobs that this will protect and 
maintain are important. The unemployment rate in Midland, Texas, is 
still in the 3, 2 range, and Odessa is the lower 4. That hides some 
other issues associated with this problem; and that is, before the drop 
in the price of oil, not only were there a lot of jobs, but a lot of 
those jobs were providing some 10, 15, 20 hours of overtime each week 
to the people that were working. Overtime is a real boost because it is 
time and a half.
  Now, then, these folks still have a job, and with the decreased 
activity, the decreased drilling and all the other activity associated 
with the crude oil business, that overtime has evaporated. These folks 
still have a job, but they built commitments and bought trucks and 
other things based on that overtime, and they are now not getting it. 
So while they still have a job, the cash flow to their families is 
impacted.
  I had another opportunity to see the impact of that recently when I 
toured our local food bank and was discussing with them what was going 
on. They said that the elderly population coming to the food bank had 
dramatically increased over the last 4 or 5 months as a result of this 
drop in prices.
  I asked, Well, why is that? They said that many of these adults, 
these elderly adults, their families had been helping them with their 
monthly bills. Because they had this extra overtime, they had extra 
money that they were able to help their families with, and now that 
that has evaporated, that trickle-down effect is impacting these 
elderly who are on fixed incomes and are having to now go to the food 
bank. Creating jobs, you just can't overstate how important that is.
  I have now been joined by my fellow Texan from the Dallas area, Pete 
Sessions, current chairman of the Committee on Rules. I yield to my 
good friend.
  Mr. SESSIONS. Chairman Conaway, I want to thank you for leading this 
effort tonight as we talk to the American people about what we are not 
only doing in Washington, D.C., but about what we began several years 
ago, a process of talking to our colleagues about how important it was 
that America have a strong energy policy. America is the only nation in 
the world that has a provision that does not allow the export of crude 
oil.
  Crude oil is something that we have been told for a long, long time, 
since the mid-1970s, that we are running out of. It is a natural 
resource that America has an abundance of, but over the years that we 
are running out of oil, we are running out and depleting what we have.
  Then a few years ago, some bit of reality took place because a change 
in technology, a change in technology that was called horizontal 
drilling, allowed those people who were in the oil patch actually 
drilling and doing the hard work necessary to extract this gift that we 
have in this country, developed a process that would allow them to get 
60 percent more oil than what had previously been provided for through 
those existing processes.
  Overnight, Americans saw that we also gained the advantage of getting 
more natural gas. The proven reserves of not only natural gas, but also 
crude oil shot up dramatically; and it became very apparent not only to 
the marketplace, because we have seen consumer prices fall over the 
last few years from over $4.40 per gallon in lots of places to last 
week, in Dallas, Texas, 2 weeks ago, gasoline at $1.97. It is true, 
last weekend that I was home, it was $2.18. Mr. Speaker, I would sooner 
be paying between $1.99 and $2.18 for the gasoline that I use as 
opposed to the scare tactics of where we were just a few short years 
ago of over $4.
  What does this mean to the American consumer? What does this mean to 
families all over the United States? More importantly, what does it 
mean to America? It means that in testimony that was gathered yesterday 
at the Committee on Rules, on which I have a chance to serve as the 
chairman, that we heard that they are expecting at least 400,000 
regular jobs that would be added to the economy. That would be all 
across the United States of America--New York, Illinois, Florida, North 
Carolina, all over this country--because it would encourage us to do 
more work, to be able, instead of taking these places and putting a 
stop on their production, we would now do more production, get it into 
the worldwide market, sell it overseas, and it becomes a product just 
like a farm product that can be sold around the world that would help 
America's exports.
  Mr. Speaker, I am here today to thank not only Chairman Joe Barton, 
but also Chairman Michael Conaway for the hard work that they have done 
to sell the ideas and the reality that America can have it both ways, 
and that is: we can produce our natural products; we can get more than 
60 percent more out of the ground than we were getting before because 
of the technology; and we can help the American consumer, moms and dads 
who need to get to work, who need to go to softball and football 
practice, and also to work and back and church and back, all in a way 
that they can meet their budget.
  I am pleased and proud to say, Chairman Conaway, you can count on me 
tomorrow, that I will be there to support this great piece of 
legislation. I want to thank you for allowing me to be with you to talk 
about the importance of this bill and to wish you good luck tomorrow.
  Mr. CONAWAY. Mr. Speaker, I thank the chairman of the Committee on 
Rules, Pete Sessions, for his kind words and also his support tomorrow.
  I think the bill that went through the Committee on Energy and 
Commerce that started life as a Joe Barton bill will be the one that 
makes it to the floor tomorrow.

[[Page 15919]]

  We are expecting to have a really solid, bipartisan vote, by the way. 
This is not a partisan issue, per se, but the White House might try to 
make it that. This is a bipartisan issue.
  I yield to my colleague from Arkansas, French Hill. French.
  Mr. HILL. Mr. Chairman, I rise in support of this commonsense bill, 
which has been a long time in coming.
  I want to thank Mr. Conaway for his leadership in bringing it to the 
floor tomorrow, and the process the committee used, which was a series 
of hearings through the process, supported by our chairman, supported 
by members on both sides of the aisle.
  I want to thank Joe Barton and Mr. Cuellar of Texas for their 
leadership in recruiting cosponsors, a large bipartisan group of 
cosponsors, to bring this longstanding bill to the floor and the 
positive efforts it will have on our economy.

                              {time}  1745

  I would like to say to my friend, Mr. Sessions--and I invite him to 
come to Little Rock--that I filled up last week for $1.82. So, perhaps 
Arkansas is a more competitive gas pricing market than even Texas. That 
may be the biggest economic news of the day here on the floor.
  We have touched on the importance of American jobs. All of our 
American jobs in the oil patch right now are suffering due to low 
prices and low development budgets. I don't have any doubt that when 
reserves are revalued September 30 for our publicly traded companies, 
their oil and gas exploration lines of credit will be down because of 
pricing in the U.S.; and, therefore, this is a boost for the economic 
opportunity for jobs in the United States in development.
  I want to touch on the national security aspects of this bill that I 
think are so important, Mr. Speaker. Early in the year, this House 
passed ways to improve liquefied natural gas to be developed and 
shipped overseas to international markets. We have an abundant amount 
of natural gas in this country. We are now the world's leading 
producer, and we have the opportunity to provide natural gas in 
liquefied form around the world to our allies in Asia and Europe. 
Likewise, eliminating the ban on crude oil, long outgrown by North 
American production and our economic success, will allow us to now, 
from a national security point of view, to have liquefied natural gas 
and crude oil as export potential and as economic job potential for the 
U.S.
  But more importantly, to our NATO allies and to our Asian allies, we 
offer them North American gas and crude oil as an alternative to the 
Mid East and, most importantly, Europe to Russia. For too long, our 
allies in Europe have been held hostage by the politics of the Mid East 
or the politics of Russia. This allows us to be a much better not only 
economic partner, but national security partner with our allies in 
Europe and our allies in Asia.
  I want to thank you, Mr. Chairman, for the opportunity to come to the 
floor and speak in strong support of this bill to remove the export ban 
on crude oil in the United States. I urge my fellow Members, both 
Democrat and Republican, to provide a good, strong, bipartisan vote and 
send that message to the United States Senate to join us in passing 
this lifting of the ban, and to send a message to White House, Mr. 
Chairman, that a veto message here is not appropriate.
  I invite the President and the OMB and the Department of Energy to 
reconsider that, in fact, this is a national security benefit to the 
United States and a jobs and economic benefit to the United States, and 
it is not the kind of thing that our President should issue a veto 
threat on.
  Mr. CONAWAY. I thank the gentleman from Arkansas for his comments and 
opinions on this issue. I hope his support draws Members of the other 
side of the aisle to our arguments and to make this happen.
  The gentleman mentioned the price he paid in Arkansas recently. I 
dare say, there is not another commodity in America that we don't check 
the price on more often than gasoline. You may not buy gas every day, 
but every time you drive by a gasoline station, you check the price 
because it is right there for everybody to see. We don't put the price 
of bread and milk up like that, but we do put the price of gasoline up.
  I have got a district that has 29 counties and is 300 miles wide and 
200-plus miles north to south. We do a lot of driving. My district 
director and I are always looking for that better gasoline price deal 
in the district as we are moving around, because hardwired into most 
all of us that drive very much is to check those prices.
  This increased production in the United States will also help protect 
consumers from price shocks. I mentioned that in 1974, the price of 
crude oil went from $3 a barrel to $12 a barrel, a fourfold increase. 
The more production you have from a stable environment like the United 
States, the less whipsaw you will get in the market from disruptions in 
supplies from places and part of the world where it is not quite as 
stable, such as the Middle East and others.
  So, this increased U.S. production will also help protect American 
consumers from being whipsawed by dramatic increases in the price of 
crude oil because we have got that supply.
  I now yield to the gentleman from North Dakota (Mr. Cramer), who is 
from another State benefitting from the shale play and someone that is 
probably more familiar with the Bakken Shale than anybody else.
  Mr. CRAMER. Mr. Chairman, your leadership on this has been great.
  As I think about what Mr. Hill from Arkansas was saying in expressing 
his appreciation for regular order and the committee process, this 
really is probably one of the greatest examples since I have been in 
Congress of a piece of legislation and a concept that has gone through 
the process the way it is supposed to go through the process. Because 
not only did the Energy and Commerce Committee have hearings on H.R. 
702, which we are going to vote on tomorrow which lifts the ban, I know 
you had a bill that similarly lifts the ban. You had hearings in the 
Agriculture Committee, which I think, by the way, the hearing you had 
was probably the best hearing on the entire topic. You honed in on that 
impact on the consumer and the input costs for producing another 
important product: food.
  And we are pretty good in the United States in places like Texas and 
North Dakota and lots of places in between at growing food--enough food 
to feed not just Americans, but a hungry world, and enhance our trade 
balance and enhance our economy in using the peaceful tool of food 
rather than weapons of war.
  I think, similarly, the shale revolution presents the same 
opportunity that food does, and that is to use the peaceful tools of 
energy development in place of or to enhance weapons of war.
  One doesn't need to be too creative to see that in the world today 
there is some chaos. When you have Vladimir Putin pushing further into 
Eastern Europe, when you have him now bombing in Syria, when you have 
him selling arms to Iran, you have Iran being able to get arms and now 
being able to sell their oil in the global marketplace, to have this 
stabilizing impact of U.S. production into the global marketplace, I 
think it can only benefit everybody. And that is true of not just 
stabilizing price, as we see the Brent global price much higher than 
the domestic WTI price. On average, over the last 5 years, that spread 
has been $11--a spread that is not enjoyed by consumers, but certainly 
harms economic opportunity and job opportunity in the United States. 
Your hearing really honed in on that cost to consumers and the benefit 
to consumers. Also, the hearing in the Foreign Affairs Committee as 
well.
  So we have had three committees of jurisdiction talking about this 
issue and this bill coming to the floor tomorrow, going through the 
Rules Committee, and the Rules Committee allowing a number of 
amendments to be debated and voted on tomorrow. Many amendments were 
introduced by Democratic Members as well as Republican Members. It has 
just been a rich experience. There are a number of issues related to 
it.

[[Page 15920]]

  Coming from North Dakota, I can tell you firsthand that not that many 
years ago I was the economic development and finance director in the 
State of North Dakota at a time when we were just stabilizing out-
migration. But part of the reason we were stabilizing it was because we 
lost so many of our young people. Our small towns were shrinking. While 
we were diversifying our economy a little bit here and there, the shale 
revolution that came along with the technology that combined fracking 
with horizontal drilling dramatically changed our State.
  Probably my favorite anecdote of the whole situation--while there are 
many--is the fact that the little town of Killdeer hadn't had a 
football team for 20 years because they couldn't field enough young 
men, and now they have a football team. And that is just illustrative 
of what has happened in many of our small towns; because in the supply 
chain in the oil and gas industry, the jobs are not only numerous, they 
are really good. They pay, on average, 25 percent higher than the 
national average.
  So it really is a grand opportunity that is somewhat being lost--
certainly, its potential is being lost--because we are now sort of 
hemmed in with light sweet crude being produced more than we can use in 
our refineries in the United States, especially the light sweet crude 
which our refineries are not set up to take, for the most part, but 
refineries outside the United States are set up to take, for the most 
part. In fact, 92 percent of the oil refined outside of the United 
States is light sweet crude. Only about 25, 30 percent of the refining 
capacity in the United States is set up to take light sweet crude. So 
that distinction is important to understand when you see that we are 
now overproducing for the refinery capacity we have in our country.
  I want to address, Mr. Speaker, some comments made earlier this week 
by Secretary of Energy Ernie Moniz, a man I have great respect for--
clearly, an intellect. He made some comments in the Senate Commerce 
Committee that, while technically accurate, I suppose were certainly 
incomplete. He had said that now is not the time to lift the oil export 
ban; and he said that according to the EIA, somehow we weren't really 
hemmed in because we were still importing some oil.
  It ignores so many things, not the least of which is that distinction 
between light sweet and heavy sour that I talked about just moments 
ago; the fact that our refineries, for the most part, in the United 
States are set up for the heavy sour that we aren't producing an excess 
of--and, by the way, about 30 percent of which are owned by vertically 
integrated companies outside of the United States who have more of an 
interest in buying their oil than ours. But the world is really where 
the opportunity exists.
  The other thing that he ignores in his statement saying that we are 
not yet hemmed in, he ignores just the natural order of things, that 
global markets, global demand being accessible to domestic producers, 
U.S. producers, will grow the production. You can't expect people to 
produce more of something than they can sell or than can be used in 
their limited market. If we have access to the global demand, of course 
we are going to produce more--that is the whole point--creating more 
jobs, more entrepreneurial opportunities.
  The other thing that bothers me about what Secretary Moniz said about 
now not being the time is that it ignores so many things. It ignores 
the fact that we still have a very low workforce participation rate in 
this country. We need more jobs. We have many people that are either 
underemployed, unemployed, no longer looking for work, and these are 
good, high-paying jobs up and down the supply chain.
  And lest we forget, they are not just jobs in the oil patch. It is 
not just in west Texas; it is not just in Houston; it is not just in 
North Dakota or Oklahoma or New Mexico. These jobs are in every State 
in the country.
  In fact, according to the Energy Equipment and Infrastructure 
Alliance, which did a vast study on this, the third leading recipient 
of new jobs, if this export ban is lifted, is the State of Illinois. 
And you might wonder, well, why is it? Well, because Illinois has a lot 
of manufacturing, especially a lot of large equipment manufacturing. 
Those manufacturing jobs are great for families. They are great for the 
economy. They are great for startup business opportunities. So it is 
every State in the country that benefits. Secretary Moniz certainly 
dismisses that, or at least ignores it, in his statements.
  I want to wrap up with this point. I always like to say that 
America's national security and America's economic security are tied 
directly to America's energy security. I touched on it earlier, but 
there has never been a time certainly in my public service when the 
world was in a more fragile state, and certainly chaos is reigning.
  I talked about Vladimir Putin's push into Eastern Europe, his bombing 
of Syria, his alliance with Iran.
  Iran, by the way, is another major producer of oil, who, as per the 
Iran nuclear deal, now gets to sell their oil onto the global 
marketplace. But our President thinks it is a better idea for them than 
he does for United States producers. He ignores the opportunity that, 
again, the peaceful development of oil and gas and the production of it 
and then the marketing of it in the global marketplace, the opportunity 
that has to spread influence and create peace in places that 
desperately need it, especially for our allies.
  It is interesting. I doubt that the folks that scheduled the floor 
time for tomorrow's bill had this in mind, because this was more of a 
process of regular order than it was the calendar; but we are, right 
now, in the middle of the 42-year recognition of the Yom Kippur War.

                              {time}  1800

  The Yom Kippur War was what sort of began, really started, the energy 
crisis that led to the 1973 embargoes. We are reliving, in many 
respects, some of the geopolitical aspects of that time and that 
situation.
  Our friends in Israel are not sure whether we are with them or not as 
a country, whether we are going to be with them on big issues, 
dependent on Russian oil largely, a Russia that is playing bad in the 
neighborhood, and uncertainty as to who is going to fill the leadership 
vacuum in places like Syria, a very important player, 42, 43 years ago.
  There is a lot adding up to this being a very, very important vote 
tomorrow on lifting the export ban on H.R. 702. There are things adding 
up that we didn't even contemplate at the time that the bill was 
introduced.
  But it is a grand opportunity to secure America's economy, secure 
America's national security while at the same time spreading our 
influence of freedom and free enterprise around the world.
  So I am looking forward to, hopefully, a lot of bipartisan votes 
tomorrow, a big vote, so that we can send that over to the United 
States Senate, who I know has a different standard than we have. But, 
hopefully, we can show them the way.
  I thank the gentleman for yielding so much time to me.
  Mr. CONAWAY. I thank the gentleman from North Dakota, clearly, a 
State that is a major player in this oil and gas renaissance that has 
occurred over the last 5 years.
  I would also like to point out that the oil and gas business, per se, 
is an incredibly fertile ground for small business development. And my 
dad, I mentioned earlier, was a great example of this.
  There are lots of narrow-focused aspects of the service side of the 
business. We all think of the drilling rigs and the big investments 
there, but there are various aspects, whether it is hauling things or 
mud or whatever is the deal, where entrepreneurs, men and women who 
want to take a little risk, can put a little capital together, put some 
tools together, and begin servicing an aspect of the business that is 
there.
  So it is incredibly fertile in terms of setting up new businesses. I 
have got one group in Eastland, Texas, that, just as the renaissance 
was beginning to start, they thought it was a good idea

[[Page 15921]]

to get into some aspect of the fracking business and, over a very short 
period of time, built that business into a multi-billion-dollar deal 
and sold it.
  So incredible wealth was created as a result of small businesses 
turning into a medium-sized business, turning into a big business, and 
then, ultimately, sold to another bigger business for an awful lot of 
money.
  And every time that happens there are jobs created associated with 
that and wealth created with that that benefits not only those 
individual communities, but all of us that are involved.
  We failed to mention that there is no ban on exporting product. Crude 
oil that is refined, turned into gasoline, turned into diesel, there is 
no ban on that.
  So refiners today can take that heavy crude that they use and the 
little bit of light, sweet crude that they use, turn that into a 
product that they then can sell into the world market, and the same 
folks can sell it back into our communities for us to use in our cars 
and in our trucks.
  That gasoline, in the main, particularly by folks, individuals, is 
bought with after-tax dollars. That means they have had to earn a buck, 
pay the taxes on it, and then take what is left out of that dollar to 
actually buy gasoline.
  As we have seen over the last several months, these lower gasoline 
prices have been a big boon to folks in our country that have to drive 
a car to get to work or take their kids to school, whatever it might 
be.
  So if you have got a $1 or a $2 drop in the price of gasoline and you 
are buying 15 gallons a week or 15 gallons every so often, that is $15 
to $30 of after-tax dollars that you can then spend somewhere else to 
benefit you and your family.
  Another aspect of what is happening is not related to what will go 
into the bill tomorrow, but it is something we have talked about on 
this floor ad nauseam, and that is the XL Pipeline. This pipeline is 
designed to haul Canadian oil sand oil, bitumen oil, that is, in 
effect, heavy crude south to the United States.
  This is the kind of crude that could run our refineries and our 
refineries would desperately like to have rather than buying the heavy 
crude from Venezuela and other places where the recipients of our 
checks when we buy that crude oil aren't necessarily friends of ours, 
aren't necessarily on the same geopolitical page that we are on.
  So having that pipeline would be another aspect of freeing up this 
market. The more efficient you can make markets, the less artificial 
restraints, the less goofy things you have got in there, then the 
better pricing mechanisms you get, the better and the more efficient 
those markets are, and then everybody up and down that chain benefits 
from that.
  As I mentioned earlier, we have got this odd circumstance where the 
producers in the United States sell on the West Texas Intermediate 
number to a refinery. That refinery then turns it into gasoline, and 
they sell it based on the Brent crude.
  So there is a differential being made by somebody, and shrinking that 
differential is what will keep the price of gasoline and diesel from 
increasing.
  One of the arguments for folks who don't represent producing 
provinces is: Why would I be in favor of something that would increase 
the folks I represent gasoline and diesel prices?
  Every study has shown that that will not happen. Now, the price of 
gasoline and diesel will go up by the world market. But as a result of 
lifting this export ban, it will, in fact, not increase the price of 
gasoline as we produce it.
  This is a win on every level. It is a win for consumers, as I have 
mentioned, it is a win for taxpayers, and it is a win for taxing 
entities.
  My colleagues from North Dakota and from Arkansas mentioned that 
reserves in the ground are valued for property tax purposes, and those 
property taxes that are generated from that then support our schools 
and other county, city, and State functions.
  As that developed crude oil is explored and those producing wells 
come online, that creates a property tax base that benefits all of the 
taxpayers in those particular entities.
  So it is a win across the world. It is a win for our allies and the 
geopolitical issues that we have talked about. So it is good for this 
country. It is good for jobs. And it is something that I hope my 
colleagues on both sides of the aisle can thoroughly look at. They have 
had plenty of time to do it.
  As was mentioned, it went through regular order, several hearings on 
the issue, actual legislation went through the subcommittee and the 
committee, the normal regular order, as we like to say around here, and 
everyone has had a chance to weigh in.
  Tomorrow there will be some amendments made in order under the rule. 
Folks will be able to weigh in. Some of those I will support. Some of 
those I will be against. But they were all presented as a way to get 
someone else's idea about this issue to the floor to have us debate it. 
I think that is a healthy thing, that we will be able to do that 
tomorrow. Some of those will perhaps pass, and some of them won't.
  But whatever happens, I have got great confidence that the bill that 
we will pass tomorrow with a big bipartisan vote can then go to the 
Senate and move the ball and move the initiative over there.
  Mr. Speaker, I appreciate the gentleman from Texas, whose work on 
this issue started his career in this business and has just joined us 
and is the lead sponsor on the bill that we will be voting on tomorrow.
  We have got probably 4 or 5 minutes left. I yield to the gentleman 
from Texas (Mr. Barton), my chairman emeritus of the Energy and 
Commerce Committee, the Dean of the Texas delegation, for whatever 
thoughts he might care to share with us.
  Mr. BARTON. I thank the gentleman from Midland, Texas, the chairman 
of the Agriculture Committee and a stalwart original sponsor of the 
bill. I appreciate your leadership, and I appreciate you doing this 
Special Order.
  Mr. Speaker, tomorrow we are going to have a debate on H.R. 702. It 
is a bill to repeal the ban on crude oil exports. This is the last 
remnant of the 1970s era energy policy for America that said we were 
running out of energy and that the only way to use the energy we did 
have was to keep it in the United States.
  As a consequence of the Arab oil embargo, we had price controls on 
oil. We had price controls on natural gas. We had limits on what 
natural gas could be used for. We had a very restrictive, defeatist, in 
my opinion, energy policy.
  All that has been repealed except for one thing, and that is this ban 
on crude oil exports. There are a number of opinions about why that has 
not been repealed, but I think the primary reason is that, until the 
last 5 years, Mr. Speaker, we really didn't have a significant amount 
of oil that could be exported.
  But a funny thing happened. Some engineers in Texas--I have to give 
my State credit--developed two technologies, one called hydraulic 
fracturing where you pressurize a formation, and another where you can 
turn the drill bit and drill horizontally.
  The combination of hydraulic fracturing and horizontal drilling has 
transformed what were considered to be uneconomic reserves, i.e., these 
tight shale formations in south Texas in the Eagle Ford, in North 
Dakota in the Bakken, in Louisiana, and up in through Pennsylvania, 
Ohio, and New York, into economically producible oil and gas 
formations.
  The consequence is, in the last 5 years, U.S. oil production has 
doubled. It got as high as almost $10 million a barrel about a year 
ago. Because of the collapse in oil prices, that production level has 
declined some, but the capacity is still there.
  So we have created a surplus in the domestic market of this light, 
sweet shale oil, but we can't export it. So what has developed is a 
two-tiered price market. You have a domestic price for oil in the 
United States that is anywhere from $2 to as much as $30 below the 
world price, which is set by North Sea oil called Brent.
  That price differential is causing wells in the United States to shut 
in. It is preventing new wells from being driven.
  If we can pass our bill tomorrow and the Senate pass it and the 
President

[[Page 15922]]

sign it, that price differential, Mr. Speaker, will go away, and we 
will be competitive to export oil into the world market.
  If we are able to do that, good things happen. We create jobs in the 
United States. We put pressure on OPEC and Russia in the world market. 
We probably bring that world price down slightly, which will result in 
lower gasoline prices for United States consumers.
  We will be competitive in the energy markets everywhere in this 
world. In Asia, in South America, in Western Europe, Central Europe, 
U.S. oil will be used as an economic product, but also as a strategic 
asset for the security of our country.
  So, Mr. Speaker, we hope to have a big vote on that tomorrow, 
somewhere between noon and 1:00. We have, I think, 10 amendments the 
Rules Committee has made in order. Some of those we will accept. Some 
of them we will oppose.
  But it has been an open process, hearings in a number of committees, 
including your committee, Mr. Chairman, the Agriculture Committee, open 
markup in subcommittee of Energy and Commerce, full committee, and 
amendments accepted from both sides of the aisle that will be on the 
floor tomorrow.
  So H.R. 702 is good for America, good for the country. It is a job-
creation bill, and we hope that we will get a big vote tomorrow 
afternoon.
  Mr. CONAWAY. I thank the gentleman.
  I want to brag on the House for having conducted this business with 
respect to this bill the way it has.
  If you go back to your grade school or your junior high civics 
classes, I'm a bill on Capitol Hill trying to become a law, this is 
exactly what happened with this deal. It went through the process the 
way it is supposed to, kind of the old-fashioned deal.
  We hope to see tomorrow a big bipartisan vote so the American people 
can at least in this one glimmer look and say, hey, the House of 
Representatives functioned the way that the Founding Fathers intended 
it to and moved an important piece of legislation forward.
  Mr. Speaker, I look forward to a big vote tomorrow. I yield back the 
balance of time.

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