Tuesday, May 22 , 2018, 4:07 pm | Mostly Cloudy 67º


Joe Sparano: Sensible Energy Policy Must Include More than ‘Just Say No!’

Consumers recognize that energy supply really matters as attitudes shift toward pursuing domestic sources.

President George W. Bush’s recent decision to lift the 18-year-old executive order on offshore oil development is a welcome sign that America may be prepared to make better and more complete use of its domestic energy resources. His decision has started an important national dialogue that recognizes energy supply really matters.

Joe Sparano
Joe Sparano

For decades, America’s informal energy policy has been to “just say no!” to safe and sane development of much of the nation’s vast oil and natural gas resources. A full 85 percent of the Outer Continental Shelf off the lower 48 states is off limits to oil and natural gas development because of federal and state policies.

During this 18-year period, our nation and the world grew and prospered at unprecedented rates, fueling a strong increase in energy demand.

The result has been an increased dependence on foreign imports that today provide 60 percent of our daily petroleum needs. These imports come largely from foreign governments that control close to 80 percent of the world’s oil reserves. Many of them are subject to political upheaval and some are hostile to U.S. interests.

Concern about disruption of energy supplies from volatile regions of the globe is one of the reasons experts say crude oil costs have increased dramatically. With crude oil costs currently making up about 75 percent of the average price of a gallon of gasoline in the United States, consumers are paying record prices at the pump.

We at the Western States Petroleum Association believe bringing additional supplies to consumers — especially from areas that are reliable and firmly within the control of the United States — will send an important message to global energy markets.

No one can say for certain more oil supplies will lower crude oil or gasoline prices. But history, logic and economic fundamentals suggest that adding reliable supplies of energy to an uncertain market where demand is outpacing supply would be welcome news for consumers.

Having said this, do we believe more of America’s offshore resources will be opened to new energy development in the near future? Perhaps not. Americans, especially those fortunate to live on our beautiful coastlines, have very strong views on this issue and have made those views clear to political leaders.

Even if Congress follows Bush’s lead and lifts its own 27-year-long moratorium on offshore development, many state and local agencies will have a great deal to say about any new development.

Recent polls suggest American consumers are beginning to change their thinking about the benefits of making better use of all our energy resources. If and when they decide to support new exploration and development of the large oil and natural gas reserves off our coasts, the petroleum industry has the experience, the technology and the trained people to bring those vital energy supplies to consumers safely and with environmental sensitivity.

Our industry today operates offshore facilities with extraordinary care and attention to safety. We have developed sophisticated technologies and equipment that monitor activities and give advanced warning if anything is awry.

Proof of this commitment to safety and the environment is our record in California over the past 38 years. According to the Interior Department‘s Minerals Management Service, since 1970 oil facilities in U.S. waters off the California coast have produced nearly 1 billion barrels of oil and spilled just 850 barrels into the marine environment.

Granted, that’s 850 barrels too many. Our goal every day is zero oil spilled.

But put into perspective, it’s 28 barrels a year. In comparison, a network of natural oil seeps just off the coast of Santa Barbara introduces about 55,000 barrels of crude oil into the ocean every year — more oil every week than has spilled from offshore activities in the last 38 years.

Advocates of the “just say no!” energy policy argue there isn’t much oil offshore and that it will take years to reach consumers.

According to the MMS, the area off our Pacific Coast alone contains as much as 13 billion barrels of oil and 22 trillion cubic feet of natural gas. And those estimates are based on a 1999 assessment.

If it were to be developed, that’s enough oil to replace all the crude we import from Saudi Arabia every day for the next 20 years. And, experience in other rich fields of energy has shown that initial assessments are usually significantly underestimated.

It’s true offshore oil and natural gas resources can’t be developed overnight. Typically, it takes five to 10 years to fully explore and characterize a field and to secure the permits, equipment and capital necessary to bring its oil and natural gas to consumers.

And it’s clear we can’t just drill our way to energy security. That’s why oil companies are spending billions to develop unconventional petroleum fuels and alternative fuels and technologies to augment our petroleum-based supplies. It’s why we encourage all consumers to conserve energy and use it as efficiently as possible.

There are no quick solutions to get us out of the energy supply hole it took us decades to dig. If we are serious about improving U.S. energy security and providing adequate, reliable and affordable fuel to consumers, we need to start making better use of our own energy resources. The sooner we start saying “yes” to domestic energy supplies, the better.

— Joe Sparano is president of the Western States Petroleum Association. The Sacramento-based organization represents the petroleum industry in California and five other Western states.

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