We’ve heard it before and it’s back again. Some in Washington are once more claiming the petroleum industry is sitting on idle leases.
The charge was made recently during a discussion of energy issues in one of the presidential debates. And now several members of Congress are circulating a report to buttress their claim that oil companies – which have paid millions to the federal government to secure leases for exploration and production – are somehow refusing to develop those leases at the same time we are encouraging government authorities to lease more federal offshore lands.
The report’s authors suggest that “Big Oil” companies like ExxonMobil should either “use it or lose it” when it comes to offshore leases, not advocate for increased access to restricted offshore areas.
But “use it or lose it” is already the law. There are provisions in all current leases that return them to government if sufficient activity doesn’t take place.
Given the millions of dollars companies must pay to obtain and maintain leases – and millions more to evaluate resource potential – it’s beyond ridiculous that there could be an incentive to not develop oil and gas to recover that investment.
The “use-it-or-lose-it” charge is a diversion from the real issue at hand – whether energy policy in this country supports the development of our own resources.
I’ve written before about how the federal government’s proposed five-year leasing plan keeps the vast majority of U.S. offshore areas off-limits to energy development, and that includes the Atlantic Ocean, Pacific Ocean, nearly all of the Eastern Gulf of Mexico and most Alaskan waters.
The challenge for domestic energy production is not that U.S. companies are ignoring the leases they have. It is that ExxonMobil and other companies have been denied access to some of the most promising acreage that could be developed for the benefit of the U.S. economy – in particular offshore.
Despite the fact that opening those areas to development could mean more than half a million jobs, Washington’s real approach to 85 percent of U.S. offshore lands isn’t “use it or lose it.” It’s more like, “you can’t use it at all.”