President Calls for Increased Oil & Gas Development
Alaska's Senators Comment on Plan to Increase Developement in Alaska

March 11, 2011
Friday

(SitNews) - In an economy that relies on oil, gas prices affect everybody -– from farmers and truck drivers to restaurant owners and workers as well as consumers. Businesses see rising prices affect their bottom line. Families feel the pinch every time they fill up the tank. For Americans already facing a tough time, it’s an added burden.

Of course, rising prices are not a new phenomenon said President Obama in a press conference this afternoon. Three years ago, before the recession hit, a combination of factors, including rising demand from emerging economies like China, drove gas prices to more than $4 a gallon. The worldwide recession and the decrease in demand pushed prices back down. But over the past year, as the economy has picked up steam and global demand for oil has increased, prices have increased again. Turmoil in North Africa and the Middle East has added uncertainty to the mix and lost production in Libya has tightened supply said Obama.

The President, before taking questions to discuss rising gas prices, which are a concern for virtually every family and business in the country, touched on the causes of the rise, ranging from world-wide economic recovery that has driven up demand and therefore prices, to the recent jolt resulting from the unrest in the Middle East and Libya. He also touched on what is not causing the rise in prices, namely the fiction that his Administration has choked off oil production – as he noted, and as this White House fact sheet (pdf) explains in detail, our oil production is now at its highest level in seven years and oil production from federal waters in the Gulf of Mexico has reached an all-time high – “So any notion that my administration has shut down oil production might make for a good political sound bite, but it doesn’t match up with reality.”

Obama said the hard truth is that as long as our economy depends on foreign oil, we’ll always be subject to price spikes. So we’ve got to get moving on a comprehensive energy strategy that pursues both more energy production and more energy conservation. We need to increase our access to secure energy supplies in the near term, and we’ve got to make our economy more energy-efficient and energy-independent over the long run.

Being more specific Obama said, " First, we need to continue to boost domestic production of oil and gas. Last year, American oil production reached its highest level since 2003. Let me repeat that. Our oil production reached its highest level in seven years. Oil production from federal waters in the Gulf of Mexico reached an all-time high. For the first time in more than a decade, imports accounted for less than half of what we consumed."

Obama said any notion that his administration has shut down oil production might make for a good political sound bite, but it doesn’t match up with reality. "We are encouraging offshore exploration and production. We’re just doing it responsibly. I don’t think anybody has forgotten that we’re only a few months removed from the worst oil spill in our history. So what we’ve done is to put in place common-sense standards like proving that companies can actually contain an underwater spill. And oil companies are stepping up -- we’ve approved more than 35 new offshore drilling permits that meet these new safety and environmental standards."

There is more we can do said Obama, however. For example he said, right now, the industry holds leases on tens of millions of acres –- both offshore and on land –- where they aren’t producing a thing. So I’ve directed the Interior Department to determine just how many of these leases are going undeveloped and report back to me within two weeks so that we can encourage companies to develop the leases they hold and produce American energy. People deserve to know that the energy they depend on is being developed in a timely manner.

Obama said we’re also taking steps that will enable us to gather data on potential gas and oil resources off the mid- and south Atlantic, and we’re working with the industry to explore new frontiers of production, safety measures, and containment technology. We’re looking at potential new development in Alaska, both onshore and offshore.

In response that Obama's Administration is “looking at potential new development in Alaska, both onshore and offshore," U.S. Senator Mark Begich (D-AK) said in a prepared statement following the press conference, “I am proud to hear that President Obama recognizes the need to increase domestic production of oil and natural gas and that new developments in Alaska, both onshore and offshore, are part of the equation."

Begich said, “Unfortunately, the reality we have seen so far from the administration includes stalled exploration in the Beaufort and Chukchi Seas, a series of federal hang-ups preventing development in the National Petroleum Reserve-Alaska and an unwillingness to recognize the enormous potential of the resources in the Arctic National Wildlife Refuge."

 Begich said, “Lowering energy prices, increasing our national security by reducing our dependency on foreign oil and creating jobs must all happen to promote long-term economic growth. Achieving these goals will require the administration to remember that Alaska is our nation’s largest potential source of safe and responsible oil and natural gas, not a Texas-sized state somewhere off the coast of California.”

Also responding to Obama's press conference remarks, U.S. Senator Lisa Murkowski (R-AK) said, “At a time when oil prices remain close to $100 a barrel, and nationwide gasoline prices are averaging more than $3.50 a gallon, American families and businesses want a plan that will lead to real relief at the pump. Today, the president failed to deliver that plan." She said, "Among the most misleading statistics used by opponents of new production is that ‘America has two percent of the world’s oil reserves, but consumes 25 percent of the world’s oil.’  I was deeply disappointed to hear it repeated today.  That statement ignores the fact that America is the world’s third-largest oil producer, and our ‘proven reserves’ are just a small part of our nation’s oil resource.  To understand why this statement is so deceptive, consider this: while America’s proven oil reserves have never exceeded 40 billion barrels, we have actually produced almost 200 billion barrels of oil since 1900."

Murkowski said, "The president also claimed credit for the fact that domestic oil production is at its highest point since 2003 – right before he announced that new production was not a solution to this emerging crisis because it would take time to bring to market.  The inconsistency between those points – especially as he called for a long-term energy policy – is striking."  

"America’s oil production rose in 2010 largely because the Bush administration fought for years to enact pro-production policies to create conditions that would make that possible," said Murkowsi. "The president didn’t mention that while 2010 was a good year, it could have been much better.  Decades of opposition in Congress and elsewhere have forced us to forgo a number of opportunities to increase production – and since taking office, this administration has also brought about an array of delays, suspensions, revocations and outright cancellations of oil leases. Earlier today, it was reported that former President Bill Clinton, talking about oil and gas leasing, said there are “ridiculous delays in permitting when our economy doesn’t need it.”

Murkowski said, "We know what the end result of those actions will be – less production, more imports, and higher oil prices – and in the years ahead, the consequences of decisions being made today will become even more painful. At a time when the administration is tying leaseholders’ hands in places like Alaska, the Gulf of Mexico and the Rocky Mountain West, the so-called ‘idle leases’ argument is also inappropriate."  

“The truth is, the extent of America’s petroleum resources has been mischaracterized for nearly a century,” Murkowski said. “Earlier today, I released a Congressional Research Service report with Sen. Inhofe of Oklahoma showing that the United States has the largest recoverable fossil fuel endowment on Earth.  Included in those resources are an estimated 163 billion barrels of oil, including at least 40 billion in Alaska alone, but they are effectively off-limits to development.  It’s time to take advantage of those resources and produce more of the energy we consume.

Murkowski said, “The president said that he was ‘looking at’ additional production in Alaska. That’s precisely the problem.  Given world events, high prices, and all the benefits that accompany oil production, ‘looking at’ more production doesn’t result in jobs for anyone but government bureaucrats and doesn’t result in lower gas prices for anyone.  We need to find more and use less. We need to actually move on – not look at – new oil production throughout America.”

During his press conference, Obama said even if we started drilling new wells tomorrow, that oil isn’t coming online overnight. And even if we tap every single reserve available to us, we can’t escape the fact that we only control 2 percent of the world’s oil, but we consume over a quarter of the world’s oil. T. Boone Pickens, who made his fortune in the oil business -- and I don’t think anybody would consider him unfriendly to drilling -- was right when he said that “this is one emergency we can’t drill our way out of.”

"We can’t place our long-term bets on a finite resource that we only control 2 percent of -– especially a resource that’s vulnerable to hurricanes, war, and political turmoil," said Obama.

So beyond increased domestic production said Obama, if we want to secure our long-term prosperity and protect the American people from more severe oil shocks in the future, the way to do it is to gradually reduce demand and then do everything we can to break our dependence on oil.

Today, U.S. Senator Lisa Murkowski (R-AK) also spoke on the Senate floor on the urgent need to develop a long-term energy policy for America that focuses on increasing domestic production and reducing overall consumption.

Petroleum News reported that Shell has plan to drill exploration wells in both Alaska's Chukchi and Beaufort seas in the 2012 and 2013 summer open water seasons. The company plans to use the Noble Discoverer drillship to drill up to four wells per drilling season in the Chukchi and to use the Kulluk floating drilling platform to drill up to two wells per season in the Beaufort, Pauline Ruddy, Shell regulatory affairs team lead, told the National Marine Fisheries Service Arctic Open-water Meeting in Anchorage, Alaska, March 8.

On the Web:

Download Sen. Murkowski's Floor Statement on Need for Long term Domestic Energy Production
http://murkowski.senate.gov/public/?a=Files.Serve&File_id=85ea48c1-279e-4155-a784-092069707cf3 (doc file)

Murkowski's speech can be seen in its entirety at: http://www.youtube.com/watch?v=Naow4PEGZkM

Source of News:

Office of U.S. Senator Mark Begich
www.begich.senate.gov

Office of U.S. Senator Lisa Murkowski
www.murkowski.senate.gov

Text of theNews Conference by the President
http://www.whitehouse.gov/the-press-office/2011/03/11/news-conference-president

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