Washington, D.C., from Thanksgiving through the new year usually takes on the characteristics of a sleepy tourist town. This year, however, has been different. With new energy legislation, high energy prices and a focus on the aftermath of hurricanes Katrina and Rita in the Gulf of Mexico, energy is an active topic in Congress and in the executive branch.
In early August, President Bush signed the Energy Policy Act of 2005 into law. This is the first comprehensive update of United States energy policy legislation in more than 12 years. At nearly 2,000 pages, the act contains many provisions impacting AAPG’s members.
Efforts on the part of federal agencies to implement the provisions of this law have begun. As professionals, business managers and as citizens, AAPG members will be impacted and need to take an active role in ensuring that implementation of this law enhances clean and efficient global energy supply.
Among the act’s provisions is unprecedented funding for technology initiatives for the oil and natural gas industry. From OCS Royalty revenues, the act provides appropriations for $50 million annually, for 10 years, to fund technology development in resource recovery in ultra-deep water, and recovery of unconventional natural gas and other petroleum resources including technology challenges for small producers.
Ongoing policy direction for this initiative will be provided through two advisory committees to the secretary of energy. AAPG has positioned itself to gain appointments to each of those committees.
Under one section of the act, the U.S. Department of Energy hosted a day-and-a-half meeting in response to the legislation requirement to update Congress on the 10-year perspective for U.S. natural gas supply and demand. Predominant supply side themes -- from the approximately 90 participants -- focused on access to prospective federal acreage, improving the efficiency of federal lands permitting and concern about the supply of trained work force (for field operations as well as geoscience professionals).
The central theme for the meeting was provided by an update of the 2003 National Petroleum Council’s “Balancing Natural Gas Policy -- Fueling the Demands of a Growing Economy.”
Other opportunities exist to weigh in on implementation of the provisions of the act. Some of those include:
- Royalty incentives for natural gas production in the Gulf of Mexico -- both deep wells in shallow water and deepwater wells.
- Provisions to expedite and streamline federal permitting processes, including additional funding to support the efforts.
- A comprehensive inventory of oil and natural gas resources in the U.S. OCS resource estimates on federal onshore, together with identification of impediments to development.
- Studies on several key issues in coalbed methane development.
In early October, Secretary of Energy Samuel Bodman tasked the National Petroleum Council with a new study on global oil and natural gas supply. In his request, the secretary posed key questions concerning what the future holds for global oil and natural gas supply, and the industry’s ability to provide incremental oil and natural gas supplies in a timely manner and at costs to meet future demand without jeopardizing economic growth.
He further asks the council to recommend energy management strategies to the United States that will ensure the greatest economic stability and prosperity.