InterviewUS climate bill may help natgas access

11 December 2007 22:49  [Source: ICIS news]

By Joe Kamalick

 

WASHINGTON (ICIS news)--Congressional support for climate control legislation that would limit US greenhouse gas (GHG) emissions could open the door for more access to abundant offshore gas reserves, a chemical industry official said in an interview on Tuesday.

 

Tom Gibson, senior vice president for advocacy at the American Chemistry Council (ACC), said that increased congressional backing for some sort of climate control legislation ultimately could bring a change of heart among many in Congress who have long opposed opening US offshore areas to oil and gas development.

 

The US chemicals industry relies heavily on natural gas as a feedstock, and gas prices have increased four fold since 1999 amid increased demand for gas as a clean fuel for electric utilities while domestic US gas production has been flat or declining.

 

Gibson said natural gas supply is the council’s primary policy issue for the new year.

 

The US Congress has maintained a moratorium on exploration and development of vast oil and gas reserves that lie in waters off the US east and west coasts and along Alaska’s lengthy shoreline.  The 26-year-old moratorium applies to 85% of US coastal areas.

 

Efforts by chemical producers and other gas-dependent manufacturers to get Congress to lift the offshore ban have largely been fruitless, although legislators did agree in late 2006 to open for development a small portion of previously closed offshore area in the eastern US Gulf.

 

Last week the Senate Environment and Public Works Committee approved S-2191, the "America’s Climate Security Act", that would impose limits or caps on greenhouse gas emissions by US manufacturers, refiners and electric utilities.  The bill was widely opposed by industry on grounds it would raise energy costs sharply, especially for gas.

 

However, Gibson said he believes the bill, which is not expected to get full Senate consideration until the first quarter next year, will serve to educate legislators on energy costs and the need for more access to abundant US domestic gas reserves.

 

“Among the assumptions in the bill that was voted out of the committee last week was that the US will build 140 new nuclear power plants in the next 20 years, but the plain fact is that the US couldn’t build that many nuke plants, even if all the permitting could be done, because there aren’t enough construction and equipment resources,” Gibson said.

 

When the full Senate comes to consider that bill next year, Gibson said, pending impact studies by the Environmental Protection Agency and the Energy Department will demonstrate to legislators the broad effect that climate control restrictions will have on energy supply.

 

“I don’t think there is a single person in Congress who wants to force the US chemicals industry offshore,” Gibson said. “We have to make them understand that there are consequences if we do not have access to natural gas supply.”  

By: Joe Kamalick
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