While Pres. Barak Obama tried to build a consensus last night on health care reform, a number of conversations I’ve recently had with oil and gas and transportation industry leaders and analysts kept recurring to me.
While Pres. Barak Obama tried to build a consensus last night on health care reform, a number of conversations I’ve recently had with oil and gas and transportation industry leaders and analysts kept recurring to me.
One by one, they said “We’re waiting to see…” Waiting to see what Washington does with “Cap and Trade.” Waiting to see what direction Washington will go with its energy policy. Waiting to see what the climate bill will entail. All big, broad issues when dealing with this nation’s economy and more questions lead to industry instability – and less investment until answers are given.
Stable, sound policy – pro-business or not – would allow execs to begin to make decisions about domestic investment.
This week, two starkly different national energy plans began their journey in the House Natural Resources Committee. The first – unveiled by the committee’s chairman Rep. Nick Rahall, D-W. Va., would overhaul the federal system for leasing public lands and give regional planning groups authorization to decide if or when producers can lease and drill – see eastern Gulf of Mexico. Rahall’s bill would also revamp the Minerals Management Service and set new, higher royalty rates on onshore production and create new fees on nonproductive leases that are not developed.
On the other side, Reps. Neil Abercrombie, D-Hawaii, and Tim Murphy, R-Pa., are pushing a bi-partisan bill that would force the federal government to open new leases in the Outer Continental Shelf areas and lift moratoriums, such as the eastern Gulf of Mexico, and boost the revenue states can collect for offshore drilling. The kicker to the bill is revenue derived from fees and royalties on federal land would finance the sexy new incentives for wind, solar and other renewable energy.
Of course the Sierra Club is already dug in against the bill, saying they’re happy Congress is trying to fund renewable energy, but they’re against new drilling.
While domestic oil and gas interests wait to see where the Obama Administration stands on energy and climate measures, they withhold domestic investments and more of the domestic fleet of drill ships, OSVs and seismic vessels venture to less complicated and cheaper environs to produce the world’s energy needs.