Monday, October 03, 2005

Hurricanes bring puch for drilling, refineries

With recent events in the Gulf Coast underscoring the fragility of the nation's energy infrastructure, some folks are looking for an opportunity to expand driling elsewhere:

Citing hurricane damage to the oil and gas industry in the Gulf of Mexico, key lawmakers are trying to relax a decades-old federal ban on new drilling off California and the Atlantic Seaboard and to encourage energy prospecting in the Rocky Mountains.

Congressional proposals also aim to waive some air pollution rules to encourage expansion of oil refineries and to authorize oil drilling beneath Alaska's Arctic National Wildlife Refuge.

Otherc claim that the hurricanes show the need to build more refining capacity as well:

It's a problem that's been building for 25 years, starting in the early 1980s, when overproduction and heavy losses forced smaller operators out of business. The trend accelerated in the 1990s, as federal and state regulators began mandating cleaner fuels and costly environmental upgrades. Then a wave of mega-mergers among oil companies led to more closures, as those firms saw consolidation as the shortest path to profits.

When hurricanes Katrina and Rita hit the Gulf Coast, they laid bare just how fragile the U.S. refining system had become. The storms knocked out fuel production and vital pipelines along the coast from Alabama to Texas and sent pump prices to record highs.

"It is unfortunate that it takes a hurricane to show us just how acute that problem is," said Rep. Joe L. Barton (R-Texas), chairman of the House Energy and Commerce Committee, whose proposed Gasoline for America's Security Act of 2005 passed through the committee last week without any hearings on its sweeping provisions.

They'd both be right...but they both leave off the need to build LNG terminals as well!!!