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Re:Power of oil and gas

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  • Robert Bruce Warburton
    I recently read an article about deep drilling in the shallow waters of the outer continental shelf. It was in last Thursday s business section, and it began
    Message 1 of 3 , Sep 2, 2002
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      I recently read an article about deep drilling in the shallow waters of the
      outer continental shelf. It was in last Thursday's business section, and it
      began on the first page. The article stated, " The federal Minerals Management
      Service will suspend the royalty, which amounts to one-sixth or 16.66 percent,
      on the first 20 billion cubic feet of gas produced below 15,000 feet, on new
      leases drilled in water less than about 600 feet deep." Even one person said,
      "said There would be drilling without it, said the big players, but royalty
      relief encourages a broader range of activity, more companies and competition."
      Furthermore, "the average size of a deep gas reservior on the shelf is about 20
      billion cubic feet, which means that all of an average reservior would be
      eligible for the royalty suspension, which covers the first 20 billion." If
      that was not enough, "the agency is considering extending the break to existing
      leases as well." That illustrates the power of oil and gas and goes along with
      some of the proposed bills that were in the handouts on the 20th.

      Mike Ewert wrote:

      > I have been reading the August 26, 2002 issue of Time Magazine and it is
      > excellent! It is a special report on How to Save the Planet in conjunction
      > with the World Summit on Sustainable Development. I want to see if I can
      > get some extra copies to give to our leaders (of any kind).
      > http://www.time.com/time/magazine/0,9263,1101020826,00.html
      >
      > Our meeting with Tom Delay about the national renewables standard was not
      > possible because he was already booked up until he returns to Washington.
      > HREG members are encouraged to keep an eye on the Congressional activities
      > regarding renewable energy this fall. See previous message for details:
      > http://groups.yahoo.com/group/hreg/message/1626
      >
      > While HREG is not a political action group, we do want to educate our
      > members on the latest technical and political developments in renewable
      > energy so they can take individual action if they like. Peter Altman of
      > SEED suggests that personal letters (handwritten even better) have the most
      > influence on our leaders.
      >
      > Representative Tom Delay's address is:
      > 2370 Rayburn HOB
      > Washington, DC 20515-4322
      >
      >
      >
      >
      > Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
    • chasmauch@aol.com
      Thanks for this post. It is just one more example of corporate welfare running wild. The following is especially wonderful: There would be drilling without
      Message 2 of 3 , Sep 2, 2002
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        Thanks for this post. It is just one more example of corporate welfare running wild. The following is especially wonderful:

        "There would be drilling without it, said the big players, but royalty
        relief encourages a broader range of activity, more companies and competition."

        No doubt. Maybe the government could pay half the cost of drilling the wells too - or even all the costs - bet that would be even more encouraging. Much as grazing, timber, and mining rights to millions of acres of federal (publicly owned) lands are essentially given away all over the country by the Minerals Management folks and the Dept. of the Interior.

        What is this but another subsidy (one of many) to the oil and gas industry? That same article states that the Minerals Management Service calculates that there are about 10 trillion cubic feet of these deposits, so assuming that only 1/10th of that amount (one trillion cubic feet) is drilled and produced, the royalty at 1/6 with a gas price of $3 per MCF (thousand cubic feet) would be worth about 1,000,000,000 MCF x 1/6 x $3 = $500,000,000 which is a pretty nice subsidy to the oil industry (and the $3 price for gas if probably going to go way up soon). 

        I'll bet every one of these oil men would claim to believe in free enterprise and free markets and hate all forms of government regulation, but what is this but a handout? This gas is not economically drillable at present royalty rates and prices so they want to change the rules to make it economic (why don't we do that for renewables?). The 1/6 royalty is not some unreasonable new bureaucratic regulation - it has been settled practice in the offshore industry for many years.

        Why not subsidize other forms of energy rather than continue to pour money into the fossil fuels sector? No wonder VP Cheney won't even tell us who participated in the meetings where our country's energy policy was formulated, let alone what was said and what kind of deals were cut. According to the article, the Minerals Management Service can suspend the royalty on its own, apparently without approval from the congress, which was no doubt part of the secret discussions. Same old story - democracy dies behind closed doors. If only the renewable industry could get that kind of subsidies. We need to keep on plugging, but most of the money and political clout are on the other side. Good luck to everyone.

        Charlie Mauch
      • Robert Bruce Warburton
        If you are interested, I would like to forward you some e-mail inquiries about my efforts to find out if the Global Electric Motorcar (GEM) vehicles qualify
        Message 3 of 3 , Oct 9, 2002
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          If you are interested, I  would like to forward you some e-mail inquiries about my efforts to find out if the Global Electric Motorcar (GEM) vehicles qualify for federal and state tax incentives. I finally got a clear cut answer from the TNRCC. I am now convinced that the U.S. and Texas government are not truly  interested in moving away from the burning of oil and gas to power our vehicles as well as produce electricity. If we used Compressed Natural Gas (CNG) we would reduce the criteria emissions such as particulate emissions (PEMs), carbon monoxide (CO), and maybe some of the other criteria emissions. However, according to a magazine article in National Geographic from February of 1981, natural gas production peaked in 1973 and oil production peaked in 1970. We are a net importer of both natural gas and oil. We were not a net importer of natural gas in 1980 according to the National Geographic in 1981. The Middle East is suppose to be swimming with oil right? Well the current edition of National Geographic shows a more updated estimate of potential oil reserves in the world. Only those Persian Gulf nations surrounding Bahrain (Iraq, Iran, Kuwait, Saudi Arabia, the United Arab Emirates, and Qatar) have significant oil reserves. Is our energy policy based upon the goal of exhausting all of the oil in the Persian Gulf? If consumption levels of oil remained constant for a long time world wide, we would probably not run out of oil this decade. However, what are the chances that consumption will remain constant? Have you read that experts are predicting a substantial increase in heating oil and natural gas prices this winter? Lately crude oil prices are hovering around $30 a barrel.
          Sincerely,
          Robert Warburton

          chasmauch@... wrote:

           Thanks for this post. It is just one more example of corporate welfare running wild. The following is especially wonderful:

          "There would be drilling without it, said the big players, but royalty
          relief encourages a broader range of activity, more companies and competition."

          No doubt. Maybe the government could pay half the cost of drilling the wells too - or even all the costs - bet that would be even more encouraging. Much as grazing, timber, and mining rights to millions of acres of federal (publicly owned) lands are essentially given away all over the country by the Minerals Management folks and the Dept. of the Interior.

          What is this but another subsidy (one of many) to the oil and gas industry? That same article states that the Minerals Management Service calculates that there are about 10 trillion cubic feet of these deposits, so assuming that only 1/10th of that amount (one trillion cubic feet) is drilled and produced, the royalty at 1/6 with a gas price of $3 per MCF (thousand cubic feet) would be worth about 1,000,000,000 MCF x 1/6 x $3 = $500,000,000 which is a pretty nice subsidy to the oil industry (and the $3 price for gas if probably going to go way up soon).

          I'll bet every one of these oil men would claim to believe in free enterprise and free markets and hate all forms of government regulation, but what is this but a handout? This gas is not economically drillable at present royalty rates and prices so they want to change the rules to make it economic (why don't we do that for renewables?). The 1/6 royalty is not some unreasonable new bureaucratic regulation - it has been settled practice in the offshore industry for many years.

          Why not subsidize other forms of energy rather than continue to pour money into the fossil fuels sector? No wonder VP Cheney won't even tell us who participated in the meetings where our country's energy policy was formulated, let alone what was said and what kind of deals were cut. According to the article, the Minerals Management Service can suspend the royalty on its own, apparently without approval from the congress, which was no doubt part of the secret discussions. Same old story - democracy dies behind closed doors. If only the renewable industry could get that kind of subsidies. We need to keep on plugging, but most of the money and political clout are on the other side. Good luck to everyone.

          Charlie Mauch

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