Just a few weeks ago, the Democrats in Congress were holding strong with House Speaker Nancy Pelosi and the left-wing political base, denying even a debate on domestic energy production — an issue today that most Americans recognize as a critical component in our broader energy policy. While it still remains to be seen whether the majority party in Congress is serious about energy security, the recent shift in support for lifting the 30-year moratorium on exploration of the Outer Continental Shelf (OCS) is more than encouraging.
Americans have begun to pay attention to the energy debate and have come to realize that the resources are out there; the problem is overcoming the political stalemates in Washington. Much of the debate over America’s energy security has taken place in the shadows of an election year; deciphering political rhetoric from fact has not been easy.
One common myth is that expanding domestic production in the OCS will not improve our energy security. A look at government energy figures should focus not only on how much we know about existing energy resources, but how much we don’t know. Because of the exploration ban, the oil industry has not been able to use current technology to estimate reserves on a majority of areas under moratorium. The most recent Interior Department figures state: “The offshore areas of the United States are estimated to contain significant quantities of resources in yet-to-be-discovered fields. Estimates of oil and gas resources in undiscovered fields on the OCS total 86 billion barrels of oil and 420 trillion cubic feet of gas.” While these numbers are intriguing in their own right, they are conservative estimates at best. The truth of the matter is this: There is an unknown quantity of resources in the Outer Continental Shelf. The only way to begin to know what they are is to begin exploring.
In an effort to appease their left wing, Democrats got caught trying to find political traction with Americans who are balancing whether to buy a gallon of gas or a gallon of milk. They argued for months that there is no reason to lift the moratorium on drilling in the OCS because oil and gas companies were already holding leases to fields that weren’t being put into production. One doesn’t have to think long and hard before recognizing the problem with this argument. First, oil and gas companies know that not all leases contain oil and natural gas (and even those that do may not contain enough to make them commercially viable). Second, so-called idle leases are not idle at all as they may well be under some stage of exploratory activity or pre-production permitting.
So ask yourself: If there is oil and gas to be put into production under these leases, why would a company risk relinquishing the lease back to the government and losing its entire investment by doing nothing? The answer is, it wouldn’t; and this explains why legislation to “force” oil companies to use their leases or else loose them failed not once but twice to pass Congress when brought to the floor this summer. As Interior Secretary Dirk Kempthorne recently noted “while increasing the productivity of already leased land is important, to ensure our country’s future security and economic well-being we need to open new areas for development.” Mrs. Pelosi has long opposed any expansion of offshore drilling, but she recently promised - and last week delivered - a vote on lifting the OCS ban. Sounds good, but isn’t. The proposal lifts the 30-year moratorium on drilling but fails to provide revenue sharing to oil-producing states. If those states do not realize a benefit, there is no incentive (and certainly not the political will) to authorize drilling. Further, the bill excludes the eastern Gulf of Mexico as well as any opportunity to drill in the Arctic National Wildlife Refuge (ANWR). As more and more Americans call for action, Mrs. Pelosi may have found political cover but she’s still done nothing to help increase America’s energy supply or independence.
Many have recognized that America needs an “all of the above” energy policy - from historic investment in alternative energy types to conservation and expanded production of domestic resources. In fact, the debate has shifted and we’re no longer talking about whether or not to drill, but how and when. This was once a polarizing issue. Yet some polls now show the support of 75 percent of the American people.
Most have come to understand that if we don’t act this energy crisis will profoundly alter our way of life, as the cost per barrel eats into our ability to save and invest. America must prevent a short-term crisis from becoming a long-term tragedy. We’ve allowed 30 years of our shortsightedness on energy security to catch us once again.
It’s time to take the initial steps to open new areas for development and to expand America’s domestic production. It’s time to drill, baby, drill. And drill now.
Michael Steele is chairman of GOPAC.
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