At a time when oil prices are at record highs, everyone scrambles for an easy solution. In the confusion many common sense observations become buried in the mass of “new” and “innovative” policy approaches that turn up on Capitol Hill.
On May 21, the United States House of Representatives approved legislation—324 for versus 84 against—that would allow the U.S. Justice Department to bring a lawsuit against OPEC members for allegedly adjusting the oil price by limiting its supply.
As of June 29, the Senate had yet to vote on the bill, according to Reuters. President Bush opposes the bill due to its potential to trigger retaliatory measures by OPEC members against American business interests. The White House has said it would veto the bill.
Republicans have argued that the law does not address the country’s energy problems. Rather than take legal action against sovereign nations, many skeptics of the bill have stated that Congress should instead clear the way for more domestic oil production in protected areas like the Arctic National Wildlife Refuge (ANWAR) in Alaska and some offshore waters that have been off limits to oil companies for more than 25 years.
Mirroring this assertion, Qatari Oil Minister Abdullah al-Attiyah said on Sunday, “The Congress should look to increase exploration inside the United States. It is strange to ask what I should produce. It’s an issue of sovereignty.”
In step with an attempt to bolster crude supplies in the U.S., the Bureau of Land Management (BLM) released the third phase of its 430-page jointly developed report, the Inventory of Onshore Federal Oil and Natural Gas Resources and Restrictions to Their Development. The inventory’s findings show that 60% of the onshore federal lands that have potential for domestic sources of natural gas and oil are currently closed to leasing due to special legislation.
The report claims that 62% of the nation’s oil and 41% of its natural gas is inaccessible for development. An additional 30% of onshore federal oil and 49% of onshore federal gas can be developed, but only after these operations are subjected to restrictions above the standard environmental lease terms including seasonal timing limitations. This leaves 8% of onshore federal oil and 10% of onshore federal gas to be developed under standard lease terms.
Several federal agencies manage parts of the 279 million acres inventoried, including the BLM, Department of Interior, and the U.S. Forest Service. An executive summary of the full report claims that undeveloped resources for these lands total 30.5 billion bbl of oil and 231 Tcf of gas. The total proved reserves for the land include 5.3 billion bbl of oil and 68.8 Tcf of gas.
With 60% of the land deemed inaccessible through legal restrictions, 19 billion bbl of oil and 94.5 Tcf are sequestered and out of reach of exploration efforts. An additional 9.3 billion bbl of oil and 112.9 Tcf are attainable through restrictions that are beyond standard stipulations. This leaves 2.3 billion bbl of oil and 23.6 Tcf of gas to be produced through standard lease terms.
If Congress is interested in lowering the country’s crude expenditure, it should seriously take a look at our own domestic inventory. We can’t place blame outside of the U.S. until we have exhausted every attempt to boost our own supply. We can’t have it both ways.
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