The Last Barrel

 Vol. 233 No. 9

For this month and next month, this column will focus on oil and gas election issues in the U.S., because at no other point in the lifetime of most people in our industry, have the stakes been higher. This might seem of little consequence or interest to some of our readers in other countries, but I would disagree. What happens in this U.S. election cycle this autumn will have significant ramifications for energy policy in this country, and whatever happens on the oil and gas front in the U.S. eventually impacts the global market.

This month, the topic centers on a subject that we brought to you six months ago, but which has persisted despite our efforts to set the record straight. What I’m referring to is the chronic habit of President Obama and his White House advisors and surrogates to mis-state, distort and/or twist the facts about oil and gas operations, especially when they do it as a means of pumping up financially disastrous “green energy” schemes.

For instance, in a speech to an Ohio campaign crowd on Sept. 3, Mr. Obama said, “Now, Ohio, you can choose an energy plan like the other guy is offering that’s written by and for the oil companies. Or you can choose an all-of-the-above strategy for American energy, which means we drill for more oil, we mine for more coal.” Oh, if only the latter sentence were true, but it’s not. Despite his rhetoric, the President has done everything possible to discourage drilling for oil, by restricting access to federal onshore lands, cancelling offshore lease sales, proposing new offshore moratoria on areas outside the Gulf of Mexico and the Arctic Ocean, and encouraging the EPA to compose, and impose, new draconian rulemaking without congressional mandate. The line about “we mine for more coal” is utterly ridiculous, given that Mr. Obama has made it virtually impossible to build and run new, coal-fired power plants, thereby reducing coal demand and throwing thousands of miners out of work, particularly in West Virginia.

In another speech on Aug. 22 in New York City, the President said, “On energy, one of the things I’m most proud of is the fact that we’ve actually reduced our dependence on foreign oil below 50% for the first time in 13 years.” This statement can be contested on two counts: 1) Depending on how you slice the import and export numbers, that figure may not be below 50%; and 2) He is guilty of pulling one of his favorite tricks, leaving out the “context” of the situation. Nowhere does he mention that the only reason that import dependence is down, is because the industry has managed to technically innovate and produce more oil, despite him sending the EPA after companies, and despite his refusal to open up more federal lands to development.

Last but not least, we have an example from one of Mr. Obama’s national campaign co-chairs, Federico Peña, who served as energy secretary under President Bill Clinton. Peña objected to a specific item in Republican Presidential Nominee Mitt Romney’s proposed energy plan, a suggestion to let states control resource development on federal lands within their borders. Romney billed the idea as a move to remove red tape and expand development of public lands faster. But Peña insisted that just the reverse could happen. Instead of just one regulating body, energy companies could face dealing with 50 separate ones. “I cannot imagine a world of 50 different kinds of rules and regulations for the industry; it would drive the industry crazy,” said Peña. “From an efficiency perspective, I don’t think it’s a workable idea.”

With all due respect, Mr. Peña is full of fecal matter. He doesn’t mention that the industry already is dealing with specific oil and gas agencies (like the Texas Railroad Commission) in several dozen states. These agencies already supervise thousands of field operations on state and private lands. Contrary to what Mr. Peña said, it would not be much of a stretch to extend this supervision to federal lands. Once again, the Obama boys have managed to take an issue and completely distort it beyond all recognition. The U.S. doesn’t need, and can’t stand, another four years of this intellectual dishonesty.

A dedicated industry voice falls silent. The U.S. upstream industry lost one of its most tireless, dedicated advocates last month, when Pat French, executive vice president of the Texas Alliance of Energy Producers, passed away on Aug. 18 at the home of one of his brothers in Bethesda, MD (see also page 147). Pat had been ill for 10 months with a particularly stout case of esophageal cancer, but he battled it valiantly, and his quiet determination was an inspiration to all.

No one worked harder than Pat to polish the industry’s image and advance a positive message of its accomplishments, whether to lawmakers, the general public, other industries or even its enemies. I should know—I worked with him in the Alliance’s Houston office for more than four years. When it came to obstacles that would get in the way of his mission, the word “quit” was not in Pat’s vocabulary. He even had pet terms to describe challenging situations. For instance, if anti-industry groups, lethargic companies or even a few recalcitrant Alliance members would chronically impede his attempts to fund and operate the Alliance or its affiliate, the Foundation for Energy Education (for which he served as president), Pat would refer to this situation as a “condition.” And if he ran into difficult or verbally hostile individuals directly, Pat would simply refer to them as “rough around the edges.”

During his last 10 months, despite battling cancer, Pat worked to bring the new energy issues-oriented television program, The Hard Question, to fruition. Indeed, two pilot episodes were produced and aired in Houston before his death. His family has asked that memorials be made to either the Foundation (www.FoundationForEnergyEducation) or to Hospice of Montgomery County, Maryland (www.montgomeryhospice.org).