Senate Republicans on February 26th introduced legislation designed to reduce U.S. dependence on foreign oil imports through increased domestic exploration and production and a variety of incentives for American oil and natural gas companies to maintain production when prices are low.
The overall aim of the legislation is to cut dependence on oil imports so that they make up only 50 percent of domestic consumption by 2011.
Oil imports currently account for 55 percent of supplies, and that number is expected to rise to 61 percent by the end of the decade if conditions remain unchanged.
The bill’s sponsors have stressed that opening the Arctic National Wildlife Refuge to crude and gas drilling is a crucial component of reducing reliance on foreign oil. Senate Majority Leader Trent Lott said that: “We need to do it for the economic future of our country.
The fact of the matter is that we don’t have an energy policy and we’re headed for trouble.” Other key provisions of the bill include reductions in royalty rates for large oil companies when oil and gas prices dip below set levels, tax credits for small well owners when prices are low, reduced royalties on deepwater crude and gas production and easier terms for obtaining federal permits for new gas pipelines.
The legislation would also require the Energy Department to submit an annual report to Congress on the U.S. refining industry beginning in 2002.
The Bush administration supports much of the proposed legislation, but is still putting together a separate national energy plan.
A special task force headed by Vice President Dick Cheney is currently reviewing what changes in energy policy should be made by the new administration, and its recommendations are expected to be announced in about a month. The bill’s sponsors have indicated that the panel’s proposals would be blended into the new legislation.
© 2001 Mena Report (www.menareport.com)
