Total U.S. oil production would double - and domestic natural gas amounts would jump by 75 percent - if big oil companies would use the drilling permits they've already been granted, according to a report by the House Committee on Natural Resources.
The committee's chairman, U.S. Rep. Nick Rahall, D-W.Va., has proposed the Responsible Federal Oil and Gas Lease Act, requiring oil companies to use land leases they've already been granted; otherwise they would lose the leases. The Secretary of the Interior would have 180 days to establish standards defining what are "diligently developed" lands.
The legislation would pertain to drilling of 68 million acres of land, both on-shore and offshore, that already is leased to oil companies but is not being developed.
Article Photos
AP Photo
Fadi Sabbagh, owner of a gas station in Paterson, N.J., pumps gas that is priced at $4.05 a gallon for regular unleaded Monday.
"Big Oil, as many Americans already suspect, are perfectly fine with high gasoline prices at the pump while they hold back domestic production on federal leases and enjoy world-record profits," Rahall said. "I am calling them on the carpet. I am calling their bluff. We are not going to continue to allow them to speculate and profiteer with public resources to the detriment of the American people."
The legislation is based on regulations that already exist in the coal industry, where coal companies are required to "diligently develop" their leases over the time of a typical 20-year lease. Oil and gas companies presently are not required to do so, and their leases are typically for 10 years.
Because there are no diligent development requirements, oil and gas companies can stockpile leases in a non-producing status, the committee report states.
It encourages them to hold nearly 68 million acres of federal land without producing oil or gas.
The report notes that if active drilling were occurring on these lands, an additional 4.8 million barrels of oil and 44.7 billion cubic feet of natural gas would be produced each day.
The numbers have convinced U.S. Rep. Charlie Wilson, D-Ohio, that drilling for oil at the Arctic National Wildlife Refuge in Alaska won't have the most immediate impact on lowering gas prices in the U.S.
"We're confused," Wilson said of President George W. Bush's push to drill at ANWR. "Why does it make a difference to drill in ANWR if the oil companies already own the right to drill on lands and they are not doing so? We know they have sufficient supplies on these lands. Why do they have to drill in ANWR?
"The oil companies can't keep stockpiling and not drilling," Wilson added. "This is helping no one. We have the oil. Why are we not drilling the oil we have?"
Wilson noted he does support drilling in ANWR but doesn't see its importance.
The report states ANWR drilling would not affect U.S. importing of oil until at least 2022, and that production there wouldn't start for at least 10 years.
"We can't wait for 10 years for ANWR to produce enough gas for us," Wilson said. "It is affecting our dollar and food prices. So much is going on because of it."
Gerry Griffith, a spokesman for U.S. Rep. Alan Mollohan, D-W.Va., said he had not yet spoken to Mollohan about the legislation Wednesday, but he said Mollohan does support drilling in ANWR.
U.S. Rep. Shelley Moore Capito, R-W.Va., also backs Bush's call for more domestic oil production from Alaska.
"For years Congress has blocked efforts to expand our nation's domestic production of energy off-shore and in Alaska, and now we're paying the price at the pump," said Capito. "It's well past time to see that policy reversed.
"There are currently more than 175 trillion cubic feet of natural gas resources and more than 1.1 trillion barrels of oil that are off limits for domestic production. With gas prices at more than $4 per gallon, we can no longer afford to let these resources sit idle," she added.
"Obviously we cannot simply drill our way out of this problem," Capito said. "There's no doubt that domestic exploration must be coupled with investment in renewable resources like wind, solar or biomass - but to ignore our immense domestic resources is short-sighted and irrational. Domestic crude oil production is down more than 12 percent since 2000 - not because of a shortage of new oil wells, but because the Congress has kept some of our most energy-rich regions off limits for drilling.
"Continued obstruction from House leadership on this issue will do nothing to help West Virginia families that are struggling with high gas prices, and I implore Nancy Pelosi and her leadership team to finally listen to the 67 percent of the American people who are calling for expanded domestic production, and the nearly unanimous population of West Virginians who want to pay lower prices at the pump."