Senator Murkowski's Floor Speech on the American Energy Production Act of 2008

• Mr. President: I rise in support of passage of the American Energy Production Act, a comprehensive energy bill that was introduced last week by the ranking member of the Energy Committee, Senator Domenici.

• There is no question that Americans are not just frustrated, but in economic distress over the prices they are paying for gasoline, heating oil, even natural gas right now. And those prices will continue to rise in the future.

• With the events of earlier this week: the rebel disturbances in Nigeria, concerns about relations with Iran and production disruptions, crude oil has moved above $120 per barrel. That hike in price is going to continue to drive retail prices for refined product even higher, above the $3.62 national average for unleaded regular that we reached earlier this week – 52 cents higher than last year.

• While there are a number of places where fuel is just above $4 per gallon, in my home State of Alaska prices this week are far above that. In Atka fuel Monday was costing $8.65 a gallon, about $1 higher than last year. In Kiana it is $6.25 a gallon, exactly $1 higher than last year. At these prices Alaskans and Americans all over the nation are having trouble making ends meet.

• Americans need relief from high fuel prices. And they need that relief now.

• Coming from Alaska I am very supportive of promoting energy conservation, greater energy efficiency and alternative energy development. But we can’t forget that we also need to actually produce more traditional energy.

• This amendment does that in many ways. It proposes to a couple thousand acres of the Arctic coastal plain to oil and gas development – the site of the likely largest onshore oil and gas deposits left to find in North America. Opening a bit of Arctic National Wildlife Refuge won’t produce new oil tomorrow, but it will affect the psychology of oil markets, because it will show that America is finally getting serious about producing the 40 billion barrels of oil and the hundreds of trillions of cubic feet of natural gas that we believe exist in current moratoria areas.

• During hearings before the Energy Committee earlier this year, we heard from witnesses who said that the current run up in world oil prices is caused by many factors: the hike in world demand for oil led by China; the continuing weakness of the U.S. dollar, which is used to pay for all oil sales; and oil becoming the new gold, a commodity that is of interest to investors because of the tightness of world supplies. What all of these factors suggest, is that we have to produce more energy from non-OPEC nations to help increase global supplies and to drive down world prices.

• Columnist Robert Samuelson said just last week in a column I wish to submit for the record, that we need to exert long-term influence on the global balance of supply and demand for energy and that means we have to actually produce more energy in this country.

• ANWR and its 10 to 16 billion barrels of economically recoverable oil, according to the USGS estimates, and 10 trillion cubic feet of natural gas, by itself won’t change the world’s energy equation. But paired with the additional 26 billion barrels that could come from OCS development in current moratoria areas, and the 80 to 100 trillion cubic of natural gas there, and paired with the fuel from coal to liquids development and the oil from U.S. oil shale deposits, can start to break the stranglehold that OPEC has on us and help to lower prices.

• As I said last week when this bill was introduced, it opening ANWR was going to come at the expense of our environment and wildlife I would oppose it. But we have new technology: directional drilling in the Arctic that will leave 100 square miles of habitat for caribou and muskoxen between well pads, ice road technology that means exploration can occur without any visible signs on the environment , and a reduction in the size of disturbances areas.

• The ANWR portion of this bill limits development to 2,000 acres of the 19.6 million acre wildlife refuge, just one ten thousandth of one percent of the refuge. It allows the establishment of critical habitat zones, and requires the use of the “best commercially available technology” to produce oil no matter what it costs the companies. This new technology can prevent environmental impacts from occurring in the North.

• This amendment also permits revenue sharing with states that decide to allow OCS development off their coastlines. But for states that don’t want it, it provides new moratoria powers to prevent drilling; powers that could be gone in just four years. With the new technology that we have, the old fears of well blowouts from offshore development should be satisfied. The fear of subsea pipeline leaks should be alleviated by the performances we saw in the Gulf of Mexico during Hurricanes Karina, Rita and Wilma in 2005, where category 5 hurricanes resulted in no major spills. The fear of water contamination by drilling muds should be resolved since non-toxic chemicals can now be used.

• This amendment also removes the moratorium imposed on oil shale production in the West. There is exciting new technology that permits production from “in situ” piping, not requiring open pit mining of the oil shale. This type of technology should be allowed to develop since America is the Saudi Arabia of oil shale, holding two trillion barrels of potential oil production.

• The coal to liquids provisions in the bill likewise sets a goal of America producing 6 billion gallons of such fuels by 2022 – one sixth of what we theoretically will produce from biofuel development by then. But it requires that the fuel not produce more lifecycle carbon emissions than gasoline and allows for waivers to protect the environment. Given that Alaska alone holds the world’s largest potential coal deposit, and that America contains about 60 percent of the world’s total reserves of coal, it is vital that we find a way to utilize the fuel. Coal is the only fossil fuel that we can develop where we know we have the technology currently to capture and store any carbon produced and to keep it out of the atmosphere.

• This bill alone could produce another 24 billion barrels of oil, enough to meet our nation’s total needs for five years. That will dampen world prices. Worse, if we don’t take these steps, we will continue to be in this exact same position of being held hostage by the world’s oil cartel for decades until new alternative technologies can replace some of the 52% dependence on coal for electricity generation and our 70% dependence on oil for surface transportation. We must stop letting ourselves be held over the proverbial barrel by the world’s nationally owned oil companies.

• Americans understand that there is no good reason, with our technology and environmental advancements, for this nation not to produce more of its own energy needs. By passing this amendment it does not mean we shouldn’t move full-speed ahead to promote non-carbon emitting nuclear power and that we shouldn’t do everything possible to produce more power from wind, biomass, hydropower and solar and from geothermal, ocean and other new technologies.

• We need them all.

• What it does mean is that America will finally show the world that we are willing to do our part in meeting our own energy needs. It used to be a mantra of the environmental community that nations should think globally but act locally. America should produce more than 38% of the oil-related energy that we consume, rather than expect other nations to supply it to us.

• America has the ability to reduce our dependency on imported energy sources, we should get on with doing it. This amendment would help cut prices now, but especially help us avoid paying these high prices for years to come.

• I thank the President and yield the floor.