Sometimes President Obama tells the truth. Like when he responded to oilman Harold Hamm’s plea that the President understand the enormous opportunity for domestic oil production.
At a meeting at the White House, as Hamm told the Wall Street Journal, “I told [Obama] of the revolution in the oil and gas industry and how we have the capacity to produce enough oil to enable America to replace OPEC. I wanted to make sure he knew about this.”
The president’s reaction? “He turned to me and said, ‘Oil and gas will be important for the next few years. But we need to go on to green and alternative energy. [Energy] Secretary [Steven] Chu has assured me that within five years, we can have a battery developed that will make a car with the equivalent of 130 miles per gallon.'” Mr. Hamm holds his head in his hands and says, “Even if you believed that, why would you want to stop oil and gas development? It was pretty disappointing.”
Obama and company have been putting the screws to offshore oil production because of the BP disaster, but that’s pretty much inkeeping with their view of energy policy. Fossil fuels bad, coal bad, natural gas bad, wind and solar wonderful.
Then there is all the stuff the administration is doing in terms of making oil and gas less profitable.
As Hamm explains, “Washington keeps “sticking a regulatory boot at our necks and then turns around and asks: ‘Why aren’t you creating more jobs,'” he says. He roils at the Interior Department delays of months and sometimes years to get permits for drilling. “These delays kill projects,” he says. Even the Securities and Exchange Commission is now tightening the screws on the oil industry, requiring companies like Continental to report their production and federal royalties on thousands of individual leases under the Sarbanes-Oxley accounting rules. “I could go to jail because a local operator misreported the production in the field,” he says.
“The White House proposal to raise $40 billion of taxes on oil and gas—by excluding those industries from credits that go to all domestic manufacturers—is also a major hindrance to exploration and drilling. “That just stops the drilling,” Mr. Hamm believes. “I’ve seen these things come about before, like [Jimmy] Carter’s windfall profits tax.” He says America’s rig count on active wells went from 4,500 to less than 55 in a matter of months. “That was a dumb idea. Thank God, Reagan got rid of that.”
If President Obama stuck to his anti-oil, anti-gas position at least he’d be consistent, but the administration also wants to claim how much good it is doing for the industry. The administration, for example, wants credit for increasing onshore oil production after years of declines.
“The Obama administration has cited the [onshore] production gains in answer to oil companies’ complaints over the past year that the drilling ban and permitting delays in the Gulf have brought the U.S. oil and gas industry to its knees.
“But critics say the administration is unfairly taking credit for rising production and falling imports when offshore projects coming onstream now were launched before President Barack Obama took office. And onshore gains are chiefly due to tight rock oil plays located on private and state lands, not federal.”
By now, few Americans remember the President’s pledge of transparency. But would a little truthfulness be too much to ask for?