Text of Domenici Floor Speech Today Regarding the Gulf of Mexico Energy Security Act
July 26, 2006
11:05 AM
Mr. President, I am going to do my best to explain why a lease sale has made its way to debate on the floor of the United States Senate. But of more importance, I am going to convince my colleagues and this nation, that this small lease sale is one of the most important issues spoken of in this chamber this year.
This morning, as the sun rises over the majestic dome of this Capitol, a family awakens in Albuquerque to start the day like millions of other Americans around this great land. They rise in their cool homes and after breakfast they start their cars and drive their children to the neighborhood pool to get some needed relief from the heat. But for these families, there is no relief from the high cost energy—for too long we have remained unable to provide a remedy for that.
In the words of the man in charge of our Nation’s monetary policy, “one likely source of the deceleration [of economic growth] is higher energy prices, which has adversely affected the purchasing power of households and weighed on consumer attitudes.” In plain speak that means, if we don’t take action -- we are in trouble. I assure my colleagues there is a growing chorus in America, and this chorus demands energy relief, and it demands our attention to this simple piece of property in the Gulf of Mexico.
We are here to talk about whether to proceed to an item that is critical to American jobs, and to our nation’s economy. In this Gulf of Mexico Energy Security Act, we direct the Secretary of the Interior to lease the area commonly known as 181 within one year of the date of enactment of this bill. Further, we remove the moratorium on the area to the South of 181 and we direct the Secretary to lease this area as soon as practicable.
Taken together, these 8.3 million acres contain 1.26 billion barrels of crude oil and 5.83 trillion cubic feet of natural gas. These resources under our sea floor are American assets on American lands, and the power to unleash these resources lies in the hands of this United States Senate. Or, we can walk away and adopt the alternative, and that is -- to continue to increase our dependence on foreign sources of energy, from hostile regions of the world, as American jobs hang in the balance.
I remind my colleagues, that between 1999 and 2005, (a period of time equal to just one term in the United States Senate), the price of natural gas in the United States increased by 289%. At the same time, we lost over 3 million U.S. jobs in the manufacturing sector. In the words of our Federal Reserve Chairman, high prices of natural gas reflect strong demand and diminished supplies. This vote today is a step toward correcting this imbalance.
Also, in this Gulf Coast Bill, we provide protections to the Florida coastline. I say this to those opposed to these protections -- these provisions are a compromise between those who seek additional access to new areas of development and those who do not want development off their shores. We struck a balance here in the Senate that has the overwhelming support of those who seek additional OCS access, and the overwhelming support of those whose priority is coastal protection. I am proud of this balance and will defend it against those who challenge it and seek to undermine it.
Finally, this bill is both fiscally responsible and meets the needs of the coastal states that make the sacrifice of hosting our nation’s energy infrastructure. I do not take my fiscal responsibility lightly. I come at this issue with a vast experience in budget matters in this United States Senate, and I can tell you that the costs associated with the sharing of OCS receipts must be weighed against the cost of inaction. And, I can tell you for certain that inaction would be devastating. When the destruction of Hurricanes Rita and Katrina ravaged our nation’s Gulf Coast, it was a national tragedy, not simply a regional occurrence. Our response should continue to be national in scope and wide in its vision.
We have all heard the anecdotes of how this region hosts about half of our nation’s refinery capacity and infrastructure. We all heard the statistics from the Minerals Management Service that show that the Outer Continental Shelf plays a major role in supplying our daily energy needs, accounting for 30% of domestic oil production and 21% of domestic natural gas production. In the words of the Director of the MMS, “The Gulf of Mexico is the most prolific producing offshore region, providing 27% of the oil and 20% of the natural gas produced domestically.” Further, MMS estimates that Gulf of Mexico production is expected to rise within the next several years to about 23% of our nation’s natural gas production and 40% of U.S. oil production.
These are impressive numbers. Now, let me share some other figures that are less impressive and should challenge each of us to rethink our nation’s policy. For all of this terrific production off of our energy coast in the Gulf of Mexico, the Federal treasury received approximately $5 Billion in 2004. Of that, the Gulf Coast States received a combined $70 Million. This is an issue of fundamental fairness.
According to the Congressional Budget Office this bill will reduce direct spending by $926 million in the first 10 years after enactment. Further, we set up a revenue sharing structure that provides sharing of 37% of revenues to the coastal States and 12.5% to the Land and Water Conservation Fund from revenues on new leases entered into after the date of enactment.
I ask my colleagues whether this revenue sharing with our energy producing States (and with a portion to all 50 States under the LWCF) is preferable to the 100% share that we currently pay to Saudi Arabia or Qatar or Nigeria when they produce the energy and we import it to our shores.
Finally, I want to talk about what the increase of the price of natural gas is doing to the American people. We are reminded by Chairman Bernanke that a significant increase in energy prices can simultaneously slow economic growth while raising inflation. We are reminded by the agricultural community, the manufacturing community, producers of chemicals and plastics, the textile industry, the utility sector, local school systems, hospitals, and small businesses all across America. Almost everything that you can think of requires an affordable and reliable supply of natural gas. Make no mistake-- American jobs are in the balance.
We are reminded by all the American people who will ask when the sun sets on the Capitol tonight – what did the United States Senate do relieve the burden on working Americans? This vote can unleash the resources in this simple piece of property to save American jobs and to answer that growing chorus in America. I deeply urge my colleagues to proceed to this vital energy bill and to pass it just as soon as we can. Mr. President, I ask for unanimous consent that my full statement be made a part of the record.
