Posted on August 15, 2006
Earlier this month, the United States Senate passed the Gulf of Mexico Energy Security Act of 2006, legislation to open up new supplies of oil and natural gas. New supplies of natural gas will lower gas prices and help keep jobs from going overseas. This is a victory for Tennessee homeowners, farmers, and chemical workers. This is the unfinished business of the Energy Policy Act of 2005, the country’s first comprehensive energy legislation in over a decade. The Energy Policy Act enhanced conservation, nuclear power and clean coal development, and made it easier to import natural gas. It contained extensive support for renewable fuels, but didn't do enough about increasing domestic supply. If we are going to take a comprehensive look at the high price of gasoline and natural gas and its effect upon Americans, we need to include steps to increase supply while we are transitioning to other forms of energy production. The Gulf of Mexico Energy Security Act is the surest way to increase the supply of natural gas in this country. The bill, which passed the Senate on August 1 by a vote of 75 to 21, directs the Department of Interior to begin deep sea exploratory oil and gas drilling in 8.3 million acres of an area of the Gulf of Mexico called “Lease Sale 181.” The natural gas supply made available by this agreement is enough to heat and cool nearly 6 million homes for 15 years. It is six times the amount of the liquefied natural gas that we are importing today in the United States. It is more oil than we import from Saudi Arabia, our principal supplier of overseas oil. It is more oil reserves than Wyoming and Oklahoma combined. The premise is fairly simple: if we increase the supply of natural gas, the price will drop. Lower natural gas prices means that companies like Eastman Chemical in Kingsport, which use natural gas as the feedstock to make products like plastic bottles, will be able to keep jobs in East Tennessee instead of moving them overseas to countries that have cheaper natural gas prices. Lower natural gas prices help farmers, who use fertilizer made from natural gas, to keep the cost of growing crops down. Lower natural gas prices also makes it more likely that Tennessee homeowners will be able to turn on their heat in the winter and turn up their air-conditioner in the summer and still be able to afford it. Senate passage of this bill is also a victory for anyone who enjoys the outdoors, because it specifies that 12.5 percent of the revenues from sales of oil and gas every year will go to states via the Land and Water Conservation Fund. This creates, in effect, an outdoor recreation and conservation royalty, so that as we use an environmental asset, we replace it with other assets, such as soccer fields, city parks, greenways and forests. Congress established the Land and Water Conservation Fund in 1964 to meet America's need for outdoor recreation opportunities, wildlife habitat conservation and open space. When I served on President Reagan's Commission on Americans Outdoors in the mid-1980s, the wisdom of a conservation royalty was widely recognized. Simply put, if drilling for oil and gas creates an environmental impact, it makes sense to use some of the proceeds to create an environmental benefit. Energy policy is like a big freight train. It is hard to get started, it takes a long time to get going, and then it is hard to stop. The Energy Policy Act is moving our country slowly down the track in the right direction toward large amounts of clean, low-cost, reliable, domestically-produced energy. The Gulf of Mexico Energy Security Act increases our energy supply and increases our momentum.