TOPICS: Offshore drilling is a false promise

Dianne Feinstein

There is no quick fix to $4.50-a-gallon gas, no way to provide instant relief to consumers we know are hurting. Yet President Bush and others continue to push the false promise of offshore oil drilling. Just this week, the president lifted the executive order banning drilling that the erstwhile US president George H W Bush put in place in 1990. And he’s asked Congress to lift its own moratorium on oil exploration on the outer continental shelf — which includes coastal waters as close as three miles from shore.

This would be a terrible mistake. It would put America’s precious coastlines in jeopardy and wouldn’t begin to fix the underlying energy-supply problem. And it surely wouldn’t ease gas prices any time soon. The vast majority of the outer continental shelf is already open to oil exploration: Areas containing an estimated 82 per cent of all of the natural gas and 79 per cent of the oil are today available to energy companies through existing federal leases. Federal agencies are issuing drilling permits at three times the rate they were in 1999 - but that hasn’t slowed oil prices during the climb from $19 to beyond $140 a barrel.

Meantime, energy companies haven’t fully used their existing permits to drill on another 68 million acres of federal lands and waters. Exploiting these areas probably could double America’s oil production and increase natural gas production by 75 per cent. Opening the protected areas of the continental shelf, on the other hand, wouldn’t produce a drop of oil for seven years or longer. It takes at least two years to process the new leases. Industry experts tell us that there’s a three- to five-year waiting list for new drilling ships and other equipment.

Oil markets are global. Economic growth around the world — including millions of new cars in Asia - means demand for oil is on the rise. With less than 3 per cent of the world’s oil reserves, the United States simply doesn’t have enough domestic oil to lower the price dramatically. A weak US dollar and instability in the Middle East exacerbate the problem. America needs to forge a long-term energy strategy that takes these factors into account, move it away from fossil fuels, and invests in renewable energy resources.

We need to promote conservation and develop clean technologies and clean fuels — like cellulosic ethanol. We need to continue to raise fuel economy standards for vehicles and improve the energy efficiency of buildings in the United States by 50 per cent. It’s also time to crack down on excessive speculation in critical energy markets.

In May, Congress took a first step by closing the “Enron loophole,” which brought more energy

trading under federal oversight. Congress now needs to eliminate other loopholes and to get serious with large institutional investors who are trading energy futures with no speculation limits. Changing America’s fuel consumption pattern is an enormous endeavor. It will take years. But this is the reality Americans face. And there’s no time to waste.