Pete Domenici

Mr. DOMENICI

Mr. DOMENICI. Yes.

Mr. DOMENICI. Yes.

Mr. DOMENICI. I thank the Senator for the answer, and I want to repeat that supply and demand clearly is what affects the price. The truth is, anyone who thinks we don't have to use oil for a significant amount of time--I mean import it--is just not taking into consideration the reality that what we use most of this oil for is cars and trucks and airplanes and the like, and we just can't make a change overnight. The Senator just mentioned one great way to lessen that, and Austin has a well-planned idea that would take 15 to 20 years to do half, to get rid of half of the automobiles and substitute electric cars. But what are you going to do during the 15 years or 20? You are going to use cars, today at least, using crude oil. You are going to use gasoline.

Mr. DOMENICI. You bet. Just so we make it clear, if there are Members of the Senate who don't want to let a vote occur on producing more oil because they don't think we need to produce more oil--and I can't imagine why, but some people just say no more carbon; some people say no more oil--they have to understand that we are going to be buying more oil whether we like it or not, unless we just stop driving or shut down America. It is going to continue to bleed us dry. So we didn't come down here after our majority leader offered an amendment, an amendment that he has been saying had an impact on the price of oil, if you can imagine that. It was an oil speculation bill. As we continue this debate, the majority leader's solution to an enormous energy crisis facing our Nation--and earlier today the majority leader gave a speech. I don't know if the Senator heard it. In that speech he said many things, but one of the things he said is that oil prices are going down because the Senate is debating--debating--oil speculation. Now, the Senator from Tennessee and I really work hard at legislating because we think legislation can have an impact. But on such a big world problem, to think that on oil supply and demand that you could come to the floor of the Senate and say in a credible manner that the price of oil has come down because a bill was introduced--and the bill was the speculation bill--you know, people haven't gone to sleep. The speculation bill has been written about, and the best thinkers have said: First, you don't need one; and, second, this one would not do anything.

Mr. DOMENICI. I want to also say, Mr. President, I think some of us who work hard in the energy field know why the price of oil has dropped a little. First, those of us who have worked at it are concerned about the supply and demand problem because we entered an era for a short time when, obviously, there was no more new supply on hand and the demand was growing. And guess what happened. The United States, the American people, not because we passed a lot of laws but because they felt the price of oil in their pocketbooks, changed the way they behaved, and as a result they saved enormous amounts of crude oil. We estimate right now that U.S. demand has been decreased by 4.3 percent, and that is about 1 million barrels a day. When the Senator just spoke a minute ago, he was right. He gave the numbers, and 5 percent of that number would have been 1, and that is what we are at--1 million barrels. That came down. That lessened the demand, the world economy had some problems, less money was spent, and the demand came down. That was supply and demand working at its best.

Mr. DOMENICI. You bet.

Mr. DOMENICI. Well, if you say just coming up with the idea would do it, then I would say no, the Senator is not right. But if we were to have done that, and it was a matter of law in America that we were going to find more because it was there--you know, Americans are pretty good at drilling. Americans don't mind using the word ``drill.'' They have told us now in the polls, in answer to the question, that they are, by 75 percent, for more drilling if it is on property we own. In fact, offshore has been the answer. So they want us to find more, and they also want to use less. It is obvious that if we would have passed that--and anybody who says we could not have because we didn't have time is just trying to pull the wool over the eyes of Americans. How many days would it take to do that if we had the will and we were given 7 days and we made a deal? We can't make a deal on anything else, but if we made one and we were going to have 7 days to debate this bill, amendments come as they may-- take down the thing that the majority leader put up there because he didn't want us to vote--7 full days of debate--we could have produced a bill that would have opened the offshore permanently, except for the 15 percent that is already open, and we would have adopted the use less, find more provisions you have so eloquently brought to us from some of your experts, the experts you talked to, some of them at your National Laboratories. Just think, after we passed that and had a signing ceremony at the White House to say: Here is what we have done, Americans. You are saving on your own, so you are using less, and we really think that is great, but we think there is still danger the price will go up, so we want to find more to keep it down--we are having the ceremony where we are celebrating both.

Mr. DOMENICI. You bet.

Mr. DOMENICI. You were here, and we got three energy bills through. People think we did nothing, but we did. We had a 6-year span here where we did a lot for energy. We changed the CAFE standards for cars. What is that going to do? Use less.

Mr. DOMENICI. And we did it with just one other item. It certainly didn't take as long as we have been down here talking instead of offering amendments--because we could not. We passed it, and there it is. Everyone knows it is great. People are telling us: Don't worry about the offshore, it takes 10 or 15 years. Do you know what they told us about the ``use less'' provision that is so important, called new CAFE standards for American automobile fleets, all our cars? They told us that will not be totally effective for 20 years. The curve goes like this: you start--you don't save any, you don't save any, and then in the 15th and 20th years, you start to finally save. Should we not have done it because it takes a long time to take effect? Of course not. We were told to get started on it because, as you said, it is the single biggest way to save gasoline and diesel fuel that anybody knows of.

Mr. DOMENICI. I want to talk to the Senator for a minute about whether we are capable of doing big things that affect the energy field. We had a chance here in the last 7 to 10 days to do something rather big. But do you know what we did 4 years ago? I was fortunate. I left the Budget Committee, where I was chairing--it seemed as though I was, at the pleasure of the Republicans, running that thing for so long, they never wanted me to step down. I finally got tired of it, and I took the Energy Committee. The first bill we passed addressed an issue that is part of this ``find more.'' It addressed the issue of why we did not build a nuclear powerplant for 27 years. We answered it in that legislation, didn't we?

Mr. DOMENICI. Do you know how many applications there were when we passed that legislation, for all America? Zero. That meant something was awry.

Mr. DOMENICI. We had not built any. You have to apply, and so you go there and look and you see whether there are any applications. As of today--I just got a briefing--do you know how many full-blown applications there are to build, locate, and design? You can put all that in one now. It takes a long time--4 years after you have done it. Sixteen American companies or consortia of companies, even though it takes a long time and they are going to have to have their money at risk for a long time, put their applications in and said: I want to get in line because I want to build, I want to find more energy. We are really grateful; for once, we have one where we don't have to argue about pollution, right?

Mr. DOMENICI. So, you see, when there is a will, there is a way. The problem is, there was no will on the part of the Democratic leader--and perhaps some behind him. I am not going to say all of them, but surely they didn't express any dissatisfaction with what was going on until, at the end, we started feeling there was some rumbling going on. Maybe they had some friction. But nobody over on that side seemed to be saying to their leader: We want to get busy here and have some votes. There was not a will, so you can't do it. You couldn't change nuclear power without a will. In that same bill we were referring to, we changed a lot of things. I wanted to tell you, one thing you have been interested in is the electric grid because you are concerned about how we are going to get the electrical power when we cannot build powerplants. Certainly, it takes a long time to use this nuclear one as the way. It takes a long time. You can build coal fastest, but there are a lot of problems with EPA and others on that, right? Then you can build natural gas. That is pretty much--you and I look upon that as Senators and say: Yes, you can do it, but it sure is risky because we need that natural gas so badly. But that is the only way they built them in the last few years. That bothers you, right? Doesn't it? Aren't you worried about that?

Mr. DOMENICI. Half of them. And then all the other things we talked about, CAFE, how long it would take going up and then start down--that applies to so many things in America that the truth is we are not going to be in a position to look to new, brand new generation of energy to move cars and trucks. We can't do that for a decade. So there is a bridge taking place, a bridge from now until we do not need oil any longer. But what does the bridge consist of? It is oil. Oil is the bridge between now and the time we do not use oil. I regret to tell you, for anyone who thinks there is no bridge--it just comes to me now--then they can walk into a canyon and drown in the water underground that is running there because they didn't walk on a bridge and they drowned themselves. I do not want to drown our country. I want to find new oil so the bridge will be less somebody else's and more ours. I understand the Chair tells us we are out of time. We will behave very well. Thank you very much. I yield the floor.

Mr. DOMENICI

Mr. DOMENICI. Thank you, Mr. President. I rise to talk about the subject that has to do with the energy legislation that has been pending before the Senate for I think 9\1/2\ days. I wish we would have had votes before this time because it is one of the most important, if not the most important, issues confronting the American people. I am going to speak about one of the amendments the majority has to offer with reference to the Energy bill. First, I wish to say I have no doubt that both sides of the aisle-- because we do know what the public is thinking, so I would think both sides do know the public has changed its mind dramatically about drilling for American oil. It wasn't too long ago that you were afraid to use the word ``drill.'' You had to use the word ``explore'' because drilling had a bad connotation. But when the American people got around to thinking about this idea that if we had more oil available and the world knew it and it was American and we could develop it, they knew that would require drilling. No matter how sophisticated the drilling has become with these giant offshore drilling pads which, if anybody had a chance to see one, such as I have, you would see what we can do hundreds of miles underwater, without any degradation of the environment, and how men can go to work with that equipment and build these giant facilities, where people can sleep while they maintain them. Underground, they can drill 10, 12, even 14 wells, and they all get piped into 1 pipe, and there isn't any seepage. When we had the great hurricane, they showed pictures of the pipes underground moving with the current but not breaking. That is what is going to happen under the ground off the coast--producing billions of barrels of oil and trillions of cubic feet of natural gas. It belongs to us. Eighty-five percent of our coast is now closed. We can speak about the fact we are already producing and already leasing, but 85 percent is not leased. Whatever is being talked about, saying that leases are there and not producing--I don't have enough time today, but I am going to explain why one of the amendments the majority has that talks about producing doesn't produce anything because it is supposedly one of these amendments that talks about drilling--drill it or lose it. That is already governed by a ``drill it or lose it'' condition in every lease. So nobody is out there operating with leases they are not using, because if they do, they lose them. They paid big money to get them so they can go down there and produce energy for us. I rise to speak on the status of the debate on this bill and on an amendment the majority has put forth under the pretext of increasing our energy supply. That is what we have been talking about--increasing our energy supply. For the most part, all the amendments we have talked about wanting to offer are increasing our energy supply. The current energy crisis is derived from many factors, but the bill the majority leader has called up attempts to deal with only one of them: speculation. There is no question that speculation is not the whole problem. In fact, four of the most prominent leaders we have in matters economic and matters that pertain to securities and matters that pertain to such things as speculation have indicated the oil and gas prices are not driven by that but, rather, by supply and demand. As I have said before, never in my 36 years in the Senate have I seen a problem so big met with a proposed solution by the majority leader that is so small. Speculation is adding to the severity of our energy crisis, but without question, an imbalance between supply and demand is at the root of the problems we face. The Republican caucus has proposed a number of solutions that measure up to the present challenge. Despite this, as we begin the eighth day of debate on this bill, we have not had a single substantive vote on it. The American people certainly deserve better, and we ought to be able to come up with something better. But that is the way the process is--7 or 8 days without voting on an amendment. For most of that time, the contention was that we could offer amendments. The truth is we could not because we would have had to withdraw some amendments the majority leader had offered, and certainly he would not have relished that. For the past week, the other side of the aisle has told the American people to believe that Republicans are up to no good, and we are obstructing progress. The truth is we merely want to complete the work our constituents sent us here to do. We know what Republican amendments seek to do. My legislation was introduced more than 12 weeks ago, and the Republican leader's bill was filed nearly 5 weeks ago. The Republican proposals clearly answer the question of how to produce more energy here at home while, at the same time, reducing the amount we consume. Our motto has been abundantly clear: find more and use less. We will, perhaps, be voting and giving everybody in this body an approach to do that. I hope when we make such agreement, we will have a clear opportunity to have votes on that kind of proposition. What has been less clear, outside of the speculation-only bill now pending, is what exactly the Democrats are willing to do to reduce the energy prices. Despite stalling progress on a real energy bill, the other side has realized they must at least appear to support greater domestic production of energy. So late last week, 14 Democratic Senators introduced their own version of the Republican plan to find more and use less. Now, finally, the text of that amendment is public. However, we know it falls short of its own goals. Gone from it are the windfall profits tax, price-gouging, and NOPEC provisions that were soundly discredited by energy experts and editorial pages of all ideological stripes. They were part of what was being tendered by the majority. They are gone from the proposal that 14 Senators from the other side of the aisle have offered. In their place is a bill that would still bring no new energy to market. It does not open any new areas to exploration--or shall I say drilling? By increasing the fees applied to leases and preproduction requirements, it could actually drive up the cost of energy and lengthen the time it takes to get that energy to market. It would delay the development of one of America's most abundant energy reserves and increase our vulnerability to an interruption in oil supply. In short, the majority party's new ``production'' proposal contains far more problems than it does solutions. It will not lower prices at the pump, it will not reduce our dependence on foreign oil, and it will not help resolve our energy crisis. That is the amendment that has been touted by Senator Bingaman and about 12 or 13 other Senators. Our dependence upon foreign oil will in no way be ameliorated, and it will not help resolve our energy crisis. It is worth taking time on the floor to examine the substance of the proposal. The amendment is No. 5135, and it claims to address a number of so-called supply side issues, including lease duration, lease rentals, lease sales, resource estimates, the Roan Plateau, and the Strategic Petroleum Reserve. I would like to take a few moments to address these issues. On the duration of leases, the amendment shortens the amount of available time to complete all the activity leading up to and including drilling for oil and natural gas. This approach would fail to increase supply for several different reasons. It ignores the reason why it takes so much time to get a lease into production in the first place. Oil companies are not just wasting time, they are mandated to use up that time. It actually adds to the central cause of those delays by creating new bureaucratic requirements for writing ``diligent development plans.'' In other words, all they are doing and all they plan to do and all this wonderful work offshore that is out there, no thanks to the Congress and the President, because we kept most of it closed--85 percent is still closed--but within that 15 percent you see terrific development and tremendous facilities. They are following rules. If you had them in a witness room and asked them what rules they are following, they would explain to you it takes a long time to go from the bid day--the day you get that lease--until you can actually drill. They do everything possible to expedite, but some of the reasons for delay they can do nothing about; they follow the rules. There are environmental rules--sometimes duplicated, but they are there. This amendment I am speaking of, in an effort to say we are going to get more and squeeze more out of what is there, I imagine these people who own it at $1.35 are not interested in squeezing out the oil for America. They are interested in lollygagging. They paid money for the lease and they have money invested, but they are not in a hurry. So we have to pass a new diligent development plan requirement. There are already as many as 39 permits, documents, and analyses that have to be done in the development of a lease. It is unclear how adding the 40th step will move the process any faster. Next, the amendment seeks to increase rental fees that leaseholders pay to occupy Federal land. The increased fees that have been proposed would discourage companies from bidding on and subsequently exploring leases that contain marginally attractive lands. Increasing the cost of doing business is not the answer. Once you think about it, most Senators overwhelmingly will agree that we don't need to add to the fees. We don't need to add to the regulatory requirements. We need the opposite if we want more production. The leader on the other side has an amendment that also attempts to alter the frequency of lease sales. This is appealing in principle, but as drafted the amendment merely pretends to speed up a process for areas where lease sales are already scheduled to take place or where lease sales have already been held without any interest from industry. In effect, this bill is attempting to take credit for something that was going to happen anyway or, worse, has already occurred without success. What the amendment does not do is open any new areas to leasing, which is the fundamental change that is so desperately needed in our management of Federal lands. Energy companies should not be forced to drill when and where it is politically convenient; they should be allowed to drill where resources are most concentrated and when conditions most warrant their development. Something of a pattern is becoming evidence here. And not surprisingly, it carries over to the so-called resource estimate--more new words and new bureaucracy--called for by this amendment. Predictably, the inventory contemplated by this amendment is only for areas that are already leased or are already open for lease sale. Instead of conducting an estimate of the resources within already open areas and already existing leases, we should authorize a full inventory of the Nation's entire resource potential, including areas that have historically been kept off-limits. Only then can Congress make an informed decision. We must fully understand what our past energy policies have kept off-limits and how those resources could be used to meet our future needs. Again, the Democratic amendment avoids this very pressing task. Another troublesome provision is the amendment's proposed swap of oil in the Strategic Petroleum Reserve. The sponsors would have 70 million barrels of light sweet crude--that is a specific type of oil that is very expensive and very versatile--they would have that released within 180 days and not replace it with fuel until as many as 5 years have gone. So had the Energy Committee not cancelled a hearing on this very topic last week, we might know if this proposal makes any sense at all. I suspect it does not. Having watched the price of oil climb by $20 a barrel from around $127 to a high of $147--and we are all grateful it has come down a little bit after deliveries of the SPR were suspended--it is highly unlikely that a short-term release of oil will reduce oil prices over any sort of time horizon. I urge my colleagues to remember the purpose of SPR is to provide oil in the event of a supply disruption, not in the event of a price increase. In the event of an emergency, enactment of this provision would reduce our ability to cover import losses from 58 days to 52. Just imagine, the American people should know with all the troubles in the Middle East and the straits, with boats loaded with crude oil, many soon to be laden with natural gas, where they can pass--look at the danger that is there. Look at America's future in terms of what might happen there. Look at what might happen accidentally, much less intentionally. We only have 58 days of Strategic Petroleum Reserve oil in the repository underground that we could use. The American people ought to be grateful--and I think they are--that we did this. We have 58 days to pump out that oil and use it if we are in one of these problems that could come about from an oil shortage on the world market because of accidents, war, conflagration, or the like. The other side would take that and say: Let's take 6 days of that reserve and put that oil out for sale and that might lower the price of oil on the market and thus lower the price of gasoline. Anybody who sees that--we will show them the numbers later what that means--will know that is not producing a new source of oil, drilling for it or exploring it. It is nothing but a short-term use of our petroleum reserves for price reasons when it should never be used for that, and it won't work anyway. The amendment has many other shortcomings. The most damaging provision to our energy security deals with the Roan Plateau in Colorado. The way the language is drafted speaks for itself. On page 26: The Secretary shall include in any mineral lease . . . a stipulation prohibiting surface occupancy or surface disturbance for purposes of exploration for or development of oil and natural gas. On page 29: The Secretary may not permit through a lease or other means any exploration for or development of oil shale resources. And then on page 30: The Secretary may not at any time issue mineral leases on public land within more than one of the phased development areas. These restrictions are somehow fit for inclusion, even after a finding on page 20 which asserts that ``the Roan Plateau Planning Area likely contains significant energy resources.'' Why were these provisions included in a title called ``Oil Supply and Management''? A plain reading of this language clearly demonstrates that it is the sponsors' desire to manage that plateau in such a way that its abundant energy resources will never be produced. In short, this is a production amendment which prohibits production. What my colleagues across the aisle don't want you to know is that a lease sale including parcels on the Roan Plateau is scheduled for August 14, a little over 2 weeks from now. If this section were enacted into law, it would likely require the land use plan or the entire area to be redone, generally taking 2 to 3 years or more. Let us not forget that the current plan for the Roan Plateau took 9 years to develop and that this provision could require that the process begin again from scratch and will eliminate any revenue from the coming August 14 lease sale which is already assumed in the budget at $100 million. For all the shortcomings in this amendment, most revealing are the measures not included in it. There is no repeal of the restriction on regulations for commercial oil shale leasing. The other side has decided to stand by a ban that they imposed last year on that resource. There is no lifting of the congressional moratorium on the development of deep sea energy resources, despite the President already taking action to do so. There is no mention of our Nation's vast domestic coal reserves which could be used to provide secure, affordable energy for decades to come. And there is no repeal of section 526 which impairs the Defense Department's efforts to develop resources of alternative domestic fuel. Taken altogether, this amendment and the underlying speculation-only bill that is before the Senate suggests that the majority is content to move on without having done anything to address the energy crisis. Nothing. We were faced with an effort to proceed to another matter this past weekend, and the Senate rightly voted to reject it. Yesterday afternoon, we were again faced with another attempt by the majority to change the topic from what we were on to another topic. Again, the Senate rightly defeated that effort. I hope we continue to defeat efforts to move away from the No. 1 domestic issue facing the American people. This issue deserves our undivided attention. There is nothing to be afraid of. We have ample time to write a good bill that makes real progress and provides real relief at the pump for the American people. I yield the floor.

Mr. DOMENICI

Mr. DOMENICI. Mr. President, I wish to just ask a question.

Mr. DOMENICI. While my leader, the Republican leader, is here on the floor, I had thought that I was going to speak for 5 minutes following you, but I understand that our side will only have 15 minutes.

Mr. DOMENICI. You want him to have? That is fine with me. I will speak afterward.

Mr. DOMENICI

Mr. DOMENICI. Mr. President, I have some remarks I think are very pertinent to what is going on in the Senate regarding energy for the American people. I wish to have answered a couple of the statements the Democratic whip stated regarding these amendments. I don't have time now, but I will soon. Suffice it to say we don't have a chance to offer amendments. Anybody who says the Republicans are free and open and have an opportunity to offer amendments is not reading the Record. The majority leader has fixed it so we can't. I rise to speak about a great amendment for the American people that will be pushed aside because the majority leader has short-circuited the so-called Energy bill. This amendment gets at the heart of what we have been saying we need to do: Find more, use less. Republicans believe we have a supply-and-demand imbalance, and the amendment I speak about this morning attacks the core of the problem. Republicans want to act on the No. 1 issue facing the American people. We want to act now. We have a great quantity of American resources on the Atlantic and Pacific offshore coasts, and so the first part of the Coleman-Domenici amendment--which we would have sent to the desk, and it could have been pending and we could vote on it, but it is out of order because the majority leader has seen to it that it is out of order. This Coleman-Domenici amendment would have allowed coastal States in those areas to open the waters within their offshore boundaries for leasing 50 miles out. Fifty miles out could not do damage to the sea, the shores, or to the coastal areas the people want to use for their daily lives. You could not even see the activity 50 miles out. The States would receive 37.5 percent of the revenues from this production, which could mean literally billions of dollars. When we passed the Gulf of Mexico Security Act of 2006, we opened deep sea areas containing more than 1.25 billion barrels of oil and nearly 6 trillion cubic feet of natural gas. This will provide domestic energy for millions of Americans, and it is roughly estimated to provide up to $400 million for the Gulf Coast States over the next 10 years, and tens of billions of dollars over the coming decade. When the Atlantic and Pacific States see this money rolling into these coastal States, they will be clamoring for more energy, more revenues, and for the good- paying jobs this great energy enterprise will bring. Our amendment is clearly a positive on several fronts. The American resources on the Atlantic and Pacific coasts contain 14 billion barrels, at a minimum. I say ``a minimum'' because we have not been prudent enough, I say to fellow Senators, to spend money to inventory it in an appropriate way--the coastal planes areas--to see how much is there. We know there is a lot. But the estimates are old estimates and, in every case, these old estimates have been very many times wrong. We have had much more in resources than the old estimate would indicate. Now, the 14 billion barrels is more than we have imported from the Persian Gulf over the last 15 years. If people wonder if there is any oil, it is 15 years of importation from the Persian Gulf will be found in these offshore waters. That is a minimum. That is the old estimate, which was done decades ago under old technology. That is why I have also filed an amendment that provides $500 million in funding to pay for a real inventory of our national resources offshore. The American people could hardly believe that we are in 2008 with modern technology and we don't know how much oil and natural gas is ours, belongs to our people, which we could use. We don't even know; we haven't bothered to find out. A few months ago, the people of Brazil set out to explore and develop their own coastal resources. Like us, they knew they had oil offshore. Like us, they didn't know exactly how much. Well, in April, one company started drilling from exploratory wells in a deep water area off of the coast of Rio de Janeiro. To their surprise, they found as much as 33 billion barrels of potentially recoverable oil. Just like that, overnight, Brazil took control of its energy dependence by finding 33 billion barrels of oil. In the words of one of the great energy experts, Daniel Yergin, who I am proud to say is a friend: Five or six years ago, nobody really thought there was a huge supply off of Brazil. Now people are saying this could be as big as the North Sea. To put that quotation into perspective, the North Sea has provided as much as 6 million barrels per day at its peak. Perhaps our amendment could do the same for our people. But we may never know because the majority leader refuses to address the most important issue in America in a serious way. For some reason I can't understand, there remain a number of Democrats--

Mr. DOMENICI. I ask unanimous consent for 1 more minute to finish.

Mr. DOMENICI. Surely.

Mr. DOMENICI. Mr. President, parliamentary inquiry: What is the order on the floor? Have we agreed on time? And I think there is some order for speeches.

Mr. DOMENICI. Who is to speak next on the rotation?

Mr. DOMENICI. Would the Senator from Maryland wish to speak now?