Once again the Senate paraded the "BIG OIL" executives out in front of another committee in hopes of finding out why gas prices are so high. Once again they refuse to look in the mirror and recognize that they are the problem. Congress creates a problem with the legislation they pass then forms a committee to form a commission to investigate the problem and grill the business they over-regulated and how congress needs to pass more legislation to fix the problem.

Today Senator Leahy asked why the prices were so high as according to his reasons the free market price should be $60-70 a barrel. As John Hofmeister President Shell Oil Company pointed out there is not a free market and fired back with information that has been widely published and is no big secret. Along with the obvious increase in demand by developing economies in China and India. Mr Hofmeister pointed out to the Senators some obvious hindrances to production.

"U.S. production has fallen steadily for the last 35 years. Oil production in
this country peaked in the 1970s. As U.S. consumption of oil has doubled,
domestic oil production has fallen off nearly 40 percent. Why? In large part,
this is the result of government policies that placed important oil and gas
resources off limits.

We still have a significant resource base in this country, both offshore and
onshore. The U.S. Government estimates that there are about 300 trillion
cubic feet of natural gas and more than 50 billion barrels of oil yet to be
discovered on the Outer Continental Shelf surrounding the Lower 48. When
you then add in the Alaska OCS resource, you add the potential for another
122 trillion cubic feet of natural gas and 25 billion barrels of oil.

Unfortunately, 85 percent of the Lower 48 resource base is off-limits
because of Congressional moratoria.

The U.S. has enormous oil shale resources, too, that, when the technology to
extract it is mature, may provide a very significant boost to domestic energy
supply. According to Rand Corporation, the oil resource in place within the
Green River Formation, which covers portions of Colorado, Utah and
Wyoming, ranges from 1.5 to 1.8 trillion barrels, of which between 500
billion and 1.1 trillion barrels are recoverable. According to Rand, “the
midpoint in our estimate range, 800 billion barrels, is more than triple the
proven oil reserves of Saudi Arabia.” The U.S. has more oil locked in shale
than any other country on Earth but impediments exist to accessing and
developing this resource.

For the past 30 years, federal policies have restricted the availability of
domestic oil and gas resources to U.S. consumers. Such as:

• Outer Continental Shelf Moratorium Atlantic Ocean
• Outer Continental Shelf Moratorium Pacific Ocean
• Outer Continental Shelf Moratorium Eastern Gulf of Mexico
• Congressional bans on onshore oil and gas activities in specific areas
of the Rockies and Alaska
• And even a Congressional ban on doing an analysis of the resource
potential for oil and gas in the Atlantic, Pacific and Eastern Gulf of
Mexico

According to the Department of the Interior, 62 percent of all onshore
federal lands are off-limits to oil and gas development with restrictions
applying to 92 percent of all federal lands.
The Argonne National Laboratory did a report in 2004 that identified 40
specific federal policy areas that halt, limit, delay or restrict natural gas
projects. I urge you to review it – it is a long list. If I may, I offer it today, if
you would like to include it in the record.

Hundreds of lawsuits result in significant delays or eventually derail energy
projects. A 2004 report by the General Accounting Office identified 10
opportunities during the leasing and permitting process where outside parties
can sue to hold up or stop oil and gas projects on federal lands. And we are
now seeing increased litigation on offshore activities as well. The combined
weight of litigation and restrictive and uncertain policies is placing a heavy
toll on America’s ability to produce its own energy resources."
-- John Hofmeister CEO Shell oil at Senate hearings 21 May 2008

Throw in the facts of no new refineries built, no Nuclear power plants, and lawsuits now in California to shut down several wind, solar and stopping hydro plants it's no wonder production is down and prices are up. Here in Arizona we have been trying to build a much needed refinery near Yuma and after several years and locations they have to pick another spot as they can't get past environmental groups.

When demand goes up and production goes down prices will go up. Today U.S. Oil companies have the most advanced and environmentally safe extraction techniques that we have ever known with directional drilling and advance techniques to find the reserves compared to thirty years ago. It can be done in a safe way to preserve the environment while providing much needed oil and natural gas to supply us while new technologies are being developed. We also need to build new Nuclear plants and refineries, France gets 85% of it's energy from nuclear so if it's good for the Europeans it must be OK for us. Continue developing Hybrids using different energy but it will be 20-30 years before it will be available on a large scale and we need to use our own resources in the meantime. In 1994 President Clinton vetoed the new exploration bill because it would take 10-12 years. 14 years later we are hearing the same excuse, now it will only take 5-6 years and we need to get started.

While this hearing was going on the House passed a resolution to allow for suing OPEC nations under anti-trust laws and monopoly laws. How ironic our lawmakers want to sue OPEC nations for not producing enough oil while we simultaneously continue to decrease and impede our own production. Do they have any clue as to how stupid and hypocritical this makes them look. We need to get past environmental scare tactics and realize that what comes out of the earth won't hurt the earth. Conservation can help but it will not produce one drop of energy and wishful thinking never accomplished anything without solid planning and action and now is the time to act before it really does become a real crisis when OPEC nations put a bigger squeeze on the supply. Continue wishful thinking as long as it is backed up with responsible action.