AGI Update on Energy Policy  Congressional Hearing Summaries 

Summary of the American Association of Petroleum Geologists Summit on Energy Policy (5-8-01)

The Bottom Line
On April 23rd, the American Association of Petroleum Geologists (AAPG) held a summit at the Army Navy Club in Washington D.C. to discuss United States energy policy. The conference brought together a range of perspectives on how energy issues should be confronted in the future. Along with petroleum resources, many other types of energy generation were discussed including nuclear power, coal, renewable resources, and conservation. The morning speakers presented the perspective of the federal government, with input from the Department of Energy, the U.S. Geological Survey, and staff of the Senate committee that drafted the first proposals for a national energy policy in the 107th Congress. Representatives from professional societies and prominent geologists from industry and government presented policy recommendations throughout the day. The agenda and related information are available at http://www.wvgs.wvnet.edu/www/energy/index.html. The final report of the summit is available at http://www.aapg.org/divisions/dpa/testimonies/2001/010423_energysummit.html.

Conference Summary
AAPG convened this President's Conference on National Issues to address energy policy because, as AAPG President Marlon Downey noted at the opening of the conference, the energy industry has a wealth of knowledge and experience that could be useful to Congress and the Administration as they work to craft an energy policy for the nation. He said, "The time is right for an improved energy policy now, and our small efforts may now have the largest effects." He encouraged the speakers to make specific recommendations for improving national energy policy. Downey made two personal recommendations: create programs that allow natural gas producers to recover their drilling costs and implement a gas tax on a state by state basis in order to reduce the nation's demand for oil. He encouraged the attendees to participate in an open-minded discussion of approaches to a national energy policy.

The first speakers discussed the Bush Administration and the congressional approach to the national energy policy. Robert Kripowicz, acting Assistant Secretary for Fossil Energy at the Department of Energy (DOE), spoke about the current DOE outlook on energy policy and the Fiscal Year (FY) 2002 DOE budget request. He emphasized the importance of damping the pendulum swings of energy markets that affect all sectors of the economy and expressed confidence that the nation can move forward with a more balanced and therefore stable energy policy for the nation. He noted that although the President's appropriation request cuts the energy research budget, funding for clean coal research and some conservation programs would receive increases.

The Majority Staff Scientist of the Senate Energy and Natural Resources Committee, Dr. Bryan Hannegan, outlined the National Energy Security Act (S. 388 and S. 389), which is the Republican proposal for a comprehensive energy policy. The proposal has three broad goals: to increase the supply of conventional energy sources, to promote conservation, and to increase the use of renewable energy sources.  Dr. Robert Simon, the committee's Minority Staff Director, spoke about the Democratic energy proposal (S.596 and S.597), which he said had some initiatives similar to the Republican legislation but also contained provisions to encourage energy conservation and development of renewable energy sources, rather than strictly focusing on increasing the supply of traditional fuels.

A panel comprised of the presidents of conference co-sponsoring organizations -- the Association of Professional Landmen (AAPL), the Society of Independent Professional Earth Scientists (SIPES), the Society of Exploration Geophysicists (SEG), the American Institute of Professional Geologists (AIPG), and the Association of American State Geologists (AASG) --  provided their perspective on the ways in which the nation's energy policy can be improved. Eric Hanson of AAPL emphasized the importance of increasing accessibility of areas of the Rocky Mountains, Alaska, the eastern and western coastal zones, and the Gulf of Mexico for natural gas exploration. Toby Carleton of SIPES encouraged the development of programs that change the public's perception of oil and gas exploration. The "not in my backyard" mentality leads to restrictions that inhibit production of domestic resources. Lee Gerhart, standing in for SEG President Sally Zinke, said that energy markets must be stable or the industry will not be able to attract investors. He also encouraged the continued development of technologies that allow resource extraction with little harm to the environment. Robert Fakundiny of AIPG read the proposed Energy Policy Position Statement of his organization. Jon Price of AASG encouraged the federal government to invest in energy research and development and help technology transfer from large to small producers.

In forming any national energy policy it is important to know the magnitude of available domestic resources. To this end, U.S. Geological Survey (USGS) Director Charles "Chip" Groat outlined the survey's 1995 assessments of oil and gas resources under U.S. public lands. He pointed out that resource estimates increase as the ability to conduct assessments increases. Groat recommended that the federal government promote industry and educational partnerships and include extraction techniques for coalbed methane and gas hydrates in the research and development portfolio.

In the afternoon session, John Hull and Edward Gilliard reviewed the National Petroleum Council Natural Gas Study that assessed the state of the natural gas industry. The report identified the critical needs of the industry to successfully increase the supply of natural gas: access to resources and rights-of-way, continued technological advancements, financing for development of new supply and infrastructure, skilled workers, an expanded U.S. drilling fleet, and ample lead times for development to meet changing customer needs.

Dr. John Edwards of the University of Colorado presented his long-term projections for the energy portfolio of the country, predicting a change from fossil fuels to other energy sources. Energy demand will continue to rise along with world population through the next one hundred years. Fossil energy sources will supply almost all of the of energy needs through 2040 and then decline as alternative renewable energy sources become a larger percentage of the mix.

The afternoon panel discussion consisted of AAPG Division of Professional Affairs President Warfield "Skip" Hobbs; Mike Decker of the AAPG Potential Gas Committee; Jeremy Platt, past president of the AAPG Energy Minerals Division; and Oklahoma Geological Survey Director Charles Mankin. Each presented an aspect of the national energy picture from the perspective of economics, natural gas, electricity generation, nuclear, coal, and alternative energy sources. It was agreed that the federal government is going to have to use a wide variety of techniques to encourage investment in all types of energy generation if adequate power supply is to be maintained.

To wrap up the afternoon, William Fisher from the University of Texas at Austin gave his views on the national energy policy in light of the day's presentations. Energy policy will always follow the path of least resistance, which for many years has been the path of low prices. In Fisher's words, the nation has become lazy and neglected essential energy infrastructure, deregulated energy markets, tied up the resources under our public lands, and not used energy efficiently. The national energy policy should contain tax incentives for small natural gas producers to develop fields of smaller potential, long-term investment in renewable resource and "clean coal" technologies, and revitalization of the nuclear industry. The toughest problem that the nation will face is providing access to public lands with oil and gas potential but which have a long history of  federal protection. He emphasized the need for law makers to be willing to compromise quickly in order to get an energy policy in place. Marlon Downey called the summit a success, and said that with the unique perspective of those "on the ground" the group will have a positive effect on the manner in which the nation's energy policy is crafted.


Please send any comments or requests for information to the AGI Government Affairs Program.

Contributed by AGI/AAPG Government Affairs Intern Spring 2001 Mary H. Patterson

Posted May 8, 2001; Last Updated July 2, 2002


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