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September 14, 2008

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Bush Urges Congress to Lift Ban on Offshore Oil Drilling

June 18, 2008

With gasoline topping $4 a gallon, President Bush urged Congress on Wednesday to lift its long-standing ban on offshore oil and gas drilling, saying the United States needs to increase its energy production. Democrats quickly rejected the idea.

“There is no excuse for delay,” the president said in a statement in the Rose Garden. With the presidential election just months away, Bush made a pointed attack on Democrats, accusing them of obstructing his energy proposals and blaming them for high gasoline costs. His proposal echoed a call by Republican presidential candidate John McCain to open the Continental Shelf for exploration

“Families across the country are looking to Washington for a response,” Bush said.

Congressional Democrats were quick to reject the push for lifting the drilling moratorium, saying oil companies already have 68 million acres offshore waters under lease that are not being developed.

House Speaker Nancy Pelosi called Bush’s proposals “another page from (an)… energy policy that was literally written by the oil industry – give away more public resources.”

Sen. Barack Obama, the Democrats’ presumptive presidential nominee, rejected lifting the drilling moratorium that has been supported by a succession of presidents for nearly two decades.

“This is not something that’s going to give consumers short-term relief and it is not a long-term solution to our problems with fossil fuels generally and oil in particular,” said Obama. Senate Majority Leader Harry Reid, lumping Bush with McCain, accused them of staging a “cynical campaign ploy” that won’t help lower energy prices.

“Despite what President Bush, John McCain and their friends in the oil industry claim, we cannot drill our way out of this problem,” Reid said. “The math is simple: America has just three percent of the world’s oil reserves, but Americans use a quarter of its oil.”

White House spokesman Tony Fratto retorted: “Anyone out there saying that something can be done overnight, or in a matter of months, to deal with high gasoline prices is trying to fool people. There is no tool in the toolbox out there that will lower gas prices overnight, or in weeks, or probably not even in months.”

Bush said offshore drilling could yield up to 18 billion barrels of oil over time, although it would take years for production to start. Bush also said offshore drilling would take pressure off prices over time.

There are two prohibitions on offshore drilling, one imposed by Congress and another by executive order signed by Bush’s father in 1990. Bush’s brother, Jeb, fiercely opposed offshore drilling when he was governor of Florida. What the president now proposes would rescind his father’s decision – but the president took the position that Congress has to act first and then he would follow behind.

Asked why Bush doesn’t act first and lift the ban, Keith Hennessey, the director of the president’s economic council, said: “He thinks that probably the most productive way to work with this Congress is to try to do it in tandem.”

Before Bush spoke, the House Appropriations Committee postponed a vote it had scheduled for Wednesday on legislation doing the opposite of what the president asked – extending Congress’ ban on offshore drilling. Lawmakers said they wanted to focus on a disaster relief bill for the battered Midwest.

Bush also proposed opening the Arctic National Wildlife Refuge for drilling, lifting restrictions on oil shale leasing in the Green River Basin of Colorado, Utah and Wyoming and easing the regulatory process to expand oil refining capacity.

With Americans deeply pessimistic about the economy, Bush tried to put on the onus on Congress. He acknowledged that his new proposals would take years to have a full effect, hardly the type of news that will help drivers at the gas stations now. The White House says no quick fix exists.

Still, Bush said Congress was obstructing progress – and directly contributing to consumers’ pain at the pump.

“I know the Democratic leaders have opposed some of these policies in the past,” Bush said. “Now that their opposition has helped drive gas prices to record levels, I ask them to reconsider their positions.”

Bush said that if congressional leaders head home for their July 4 recess without taking action, they will need to explain why “$4 a gallon gasoline is not enough incentive for them to act. And Americans will rightly ask how high gas prices have to rise before the Democratic-controlled Congress will do something about it.”

Bush said restrictions on offshore drilling have become “outdated and counterproductive.”

In a nod to the environmental arguments against drilling, Bush said technology has come a long way. These days, he said, oil exploration off the coastline can be done in a way that “is out of sight, protects coral reefs and habitats, and protects against oil spills.”

Congressional Democrats, joined by some GOP lawmakers from coastal states, have opposed lifting the prohibition that has barred energy companies from waters along both the East and West coasts and in the eastern Gulf of Mexico for 27 years.

On Monday, McCain made lifting the federal ban on offshore oil and gas development a key part of his energy plan. McCain said states should be allowed to pursue energy exploration in waters near their coasts and get some of the royalty revenue.

Obama retorted that the Arizona senator had flip-flopped on that issue.

This story is courtesy of Associated Press

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Copyright 2008 The Associated Press. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.


How to Lower Gas Prices In America According To Shell

April 30, 2008

Wednesday marks the 16th consecutive day of record-setting gas prices with the average reaching $3.62 per gallon, according to AAA. The president, John Hoffmeister, of Shell Gas Company, the American division of Royal Dutch Shell, discussed the issue of rising gas prices with John Roberts on “American Morning” on CNN.

Here is a brief excerpt of the interview:

ROBERTS: What do you say to people who are in this budget crunch of trying to fill up the family car?

HOFMEISTER: I say we need more gas to be produced in this country. I’ve been saying that for three years, ever since I took this position [as president of Shell].

If the U.S. set a goal to produce 2 to 3 million barrels more a day in this country, we would send a shock around the world that would immediately say to the speculators, hey, U.S. is serious. President [Bush] said something yesterday about this. I didn’t hear him, but I think that’s good news. But we should set a specific target.

The presidential candidates should be out there on the postings saying let’s increase domestic production by 2 to 3 million barrels a day. That would be something that would put money back into this country, jobs back into this country, and it would bring more supply toward the Americans who need it.

ROBERTS: The president is advocating more drilling on U.S. territory. Isn’t it true that globally we’re starting to reach a peak in production and that within maybe a decade or two oil production will begin to decrease?

HOFMEISTER: Well, I think there is some argument [that] with convenient, easy oil we will peak sometime in the next decade. I think Shell sees that coming, but in terms of total oil supply to the world, we’re a long way from reaching peak oil because it doesn’t take into account unconventional oil.

I think the president brings up a good point in that we could, we have the available domestic supplies off the coast of Alaska as well as [the Alaska National Wildlife Refuge]. Shell has won $2 billion worth of high bids for the Chukchi Sea — that’s a few years off before we could begin production.

But let’s remember there’s more than 100 billion barrels of untouched oil and gas in this country that is subject to a 30-year moratorium. Now, there’s only one body in this country that can set a 30-year moratorium, and that’s the U.S. government.

ROBERTS: Sen. Hillary Clinton wants to slap you with a 50 percent tax on what she calls windfall profit, profit above a certain level. Is that a good idea?

HOFMEISTER: Look at our revenues and our income for the last quarter. If we had made $7.8 million on $114 million of revenue, nobody would call that excessive, because that’s 7½ percent. We made $7.8 billion profit on $114 billion revenue — same 7½ percent. So to me that is not an excessive number when banks and pharmaceuticals and IT companies earn a whole lot more.

ROBERTS: Would it hurt you if she put in place this tax on the windfall profits?

HOFMEISTER: Sure it would. It would slow down investment. Taxing the oil companies was tried in the ’80s. It drove us to do imports, which is exactly the problem we have today.

ROBERTS: Where is the top of all this? How high can the price of a barrel of oil go? How high will the cost of a gallon of gasoline go?

HOFMEISTER: I heard somebody say the other day it’s as long as a piece of string. We don’t know.

ROBERTS: The president of OPEC said $200 a barrel.

HOFMEISTER: Yeah, well, there are some countries out there subsidizing the cost of their energy to their consumers and industries to compete with America — or against America — because they think America won’t solve the problem.

ROBERTS: You’re saying you have no idea where the top is.

HOFMEISTER: We don’t know. But we should produce more oil in this country.

iNPLACENEWS


Highest Oil Prices Ever

April 28, 2008

Oil prices hit an all-time high, near $120 a barrel, Monday after a weekend refinery strike closed a pipeline system that delivers a third of Britain’s North Sea oil to refineries in the UK.

Workers at the Grangemouth oil refinery in Scotland walk out Sunday at the start of a two-day strike

The shutdown comes amid supply outages in Nigeria that have helped to support oil against a strengthening dollar.

“We’ve got a confluence of a number of events that have really disrupted crude oil supply,” said Victor Shum, an energy analyst with Purvin & Gertz in Singapore. “That’s what’s driving oil to a new record even though the U.S. dollar actually strengthened a bit.”

Light, sweet crude for June delivery rose to a record $119.93 a barrel in electronic trading on the New York Mercantile Exchange. The contract eased back to $118.96 a barrel by late afternoon in Singapore, up 44 cents from Friday’s close of $118.52.

BP Sunday shut down the Forties Pipeline System that carries more than 700,000 barrels of oil a day to the U.K. because of a 48-hour walkout by employees at a refinery in central Scotland.

Workers walked out of the Grangemouth refinery vowing not to give ground in their dispute with refinery owner Ineos over plans to close a generous pension scheme to new employees.

Ineos chief executive Tom Crotty said it could take a week for the plant to return to production once the strike ends on Tuesday. BP said its pipeline could be up and running within 24 hours.

BP’s Kinneil plant, the onshore processing center for the pipeline system, is powered from the Grangemouth site.

“With the refinery being shut down, it will affect supplies from the North Sea and that has a potentially significant impact,” said David Moore, a commodity strategist with the Commonwealth Bank of Australia in Sydney. “That comes at the same time that there’s production disruptions from Nigeria so the combined effect of those is the immediate factor that’s put pressure on oil prices.”

The rest of the article can be read @ CNN.com

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