In the Pipeline: 5/16/11

A moment of clarity from the USA Today — it’s time to end all subsides, simplify the tax code, and lower tax rates for everyone USA Today (5/16/11) reports: Not surprisingly, the oil industry is grumbling. “A vindictive money grab,” is how the head of the American Petroleum Institute sums up the effort…In truth, it is all of those things, but mostly it is an example of the sort of political gamesmanship that substitutes for serious deficit reduction…The $20 billion is real money worth saving, but it is just 1/200th of the $4 trillion that is widely seen as the minimum that needs to be found over the next 10 years…Earlier this spring, Republicans indulged in their own game of Trivial Pursuit, cutting some minor agencies, such as public broadcasting, that weren’t contributing much to the deficit but which they didn’t much like. Now Democrats are saying, in effect, two can play at that game. They are trying to force Republicans to take the side of an industry about as popular as the flu. With gasoline at $4 a gallon, it’s an easy target…But the initiative is also government at its arbitrary worst, further complicating the tax code by singling out five companies — ExxonMobil, Chevron, ConocoPhillips, Shell and BP — for special taxes not paid by smaller energy concerns, or by similar companies in other industries.

Senator Bingaman plans on making sausage…err energy policy with Senator Menendez C-Span(5/15/11) reports: As gas prices reach $4 and higher in many parts of the country, Congress is debating several bills related to the oil industry and efforts to curb spending…Sen. Jeff Bingaman (D-NM) gives his thoughts on a bill sponsored by his colleague, Sen. Menendez (D-NJ), to repeal tax breaks and subsidies for large oil companies…Senate Majority Leader Harry Reid (D-NV) is currently in negotiations to bring the bill to the Senate floor for a vote. However, it’s met opposition from Republicans and some Democrats. Sens. Landrieu (D-LA), and Begich (D-AK), who represent energy-producing states, have come out against the bill…The House is also focused on energy legislation. This past week the Republican leadership passed three drilling-related bills which differ from the Senate agenda. The legislation aims to expedite approvals of oil drilling permits, reverse President Obama’s imposed moratorium on deepwater drilling in the Outer Continental Shelf and to set a national goal for oil and gas production.

Obama says not to worry, more oil production is on the way —I’m still worried New York Times(5/16/11) reports: President Obama, facing voter anger over high gasoline prices and complaints from Republicans and business leaders that his policies are restricting the development of domestic energy resources, announced Saturday that he was taking several steps to speed oil and gas drilling on public lands and waters… It was at least a partial concession to his critics at a time when consumers are paying near-record prices at the gas pump. The Republican-led House passed three bills in the last 10 days that would significantly expand and accelerate oil development in the United States, saying the administration was driving up gas prices and preventing job creation with antidrilling policies…Administration officials said the president’s announcement, which included plans for expanded drilling in Alaska and the prospect of new exploration off the Atlantic coast, was intended in part to answer those arguments, signal flexibility and demonstrate his commitment to reducing oil imports by increasing domestic production…But in fact the policies announced Saturday would not have an immediate effect on supply or prices, nor would they quickly open any new areas to drilling.

Here’s why I’m worried: the number of rigs actively exploring for new oil is down Fuel Fix(5/13/11) reports: The number of rigs actively exploring for oil and natural gas in the U.S. decreased by six this week to 1,830…Houston-based Baker Hughes Inc. reported Friday that 947 rigs were exploring for oil and 874 for gas. Nine were listed as miscellaneous. A year ago, the count was 1,506…Of the major oil- and gas-producing states, New Mexico gained two rigs while Alaska, North Dakota, Texas and West Virginia each gained one…Arkansas, Oklahoma and Pennsylvania each lost two rigs and Louisiana lost one. California, Colorado and Wyoming were unchanged…The rig count peaked at 4,530 in 1981, the height of the oil boom. The record low of 488 was in 1999.

I’m not the only one worried — Rep. Upton and Rep. Whitfield are heading down to the Gulf The Hill (5/13/11) reports:  The House Energy and Commerce Committee’s GOP leadership will visit the Gulf of Mexico next week to in a trip aimed at making the case for expanded offshore oil-and-gas development…Chairman Fred Upton (R-Mich.) and Rep. Ed Whitfield (R-Ky.) — his top lieutenant on energy — will be in Louisiana Wednesday through Friday on a tour led by Rep. Steve Scalise (R-La.)…A Scalise aide said the trip will include meetings with energy industry officials Wednesday, a day-long visit Thursday to a Chevron Corp. deepwater drilling platform, and a Friday boat tour of the Louisiana coast…“This is a way to get members down so they can see Louisiana because it is truly America’s energy coast,” said Scalise spokesman Stephen Bell. He said the tour of the Chevron facility is aimed at reviewing the infrastructure and technology that companies are using to drill with safeguards in deep waters.

We might need to dam up enviros’ tears with this news — hydro power works and developing countries can’t get enough New York Times (5/15/11) reports: Hydropower, a renewable energy source often overshadowed by excitement about wind and solar power, is enjoying something of a global resurgence…Huge, controversial dam projects have recently made headlines in Brazil, Chile and Laos. Many developing countries, hungry for energy to supply their growing economies over the long term, are determined to keep building more modest-sized dams too…Record amounts of hydropower capacity came online in 2008 and 2009, the most recent years for which data are available, according to Richard Taylor, executive director of the International Hydropower Association in London…“There has been, over the last decade, a dramatic increase in the deployment of new hydropower capacity,” Mr. Taylor said.



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