American Oil and Gas Reporter - June 2015 - 40

Federal Legislation

Senators Debate Lifting Oil Export Ban
WASHINGTON-Oil and gas groups
in May were singing the praises of U.S.
Senate efforts led by Lisa Murkowski, RAk., and Heidi Heitkamp, D-N.D., to lift
the nation's ban on most crude oil exports.
Murkowski, who chairs the Senate
Energy and Natural Resources Committee, introduced S 1312, the Energy Supply and Distribution Act of 2015, on
May 13, along with Heitkamp and 11 other co-sponsors. A week later, Heitkamp
took the lead with Murkowski and two other co-sponsors in introducing the American Crude Oil Export Equality Act.
Meanwhile, Murkowski began hearings
in the Energy Committee on nearly two
dozen proposals that were considered
candidates to form a bipartisan, comprehensive energy package. It was not immediately clear whether the two export bills
would be part of that package, one published report noted, saying, "Other options
include putting (the bills) forward on
their own or attaching them to trade legislation."
Three bills that were under consideration for the Energy Committee package,
however, were S 1276, S 1278 and S 1279,
which would open additional areas of the
Outer Continental Shelf to oil and gas exploration in the Atlantic and Arctic oceans,
and Eastern Gulf of Mexico.
Published reports described the bills being considered by the Senate committee
as "a wish list for the Senate's comprehensive energy bill, which will address efficiency, infrastructure, supply and accountability."
Included are "proposals aimed at promoting natural gas pipelines, rooftop solar panels, 'smart grid' technology, and related energy infrastructure needs, according to a report forwarded by the Texas Alliance of Energy Producers. "The Senate
committee will look at four main areas:
natural gas pipelines, electric transmission
lines, smart grid technology such as energy storage, and alternative sources such as
distributed generation," the report outlines.
A list posted on the Energy Committee website includes bills dealing with geothermal exploration and production, hydroelectricity, methane hydrate research,
a renewable electricity standard, venting
and flaring natural gas, and developing a
skilled energy workforce.
Among the latter, according to his office, is legislation developed by Senator
Lamar Alexander, R-Tn., that would reauthorize the energy programs contained in
the America COMPETES Act, which

40 THE AMERICAN OIL & GAS REPORTER

was passed originally in 2007 and reauthorized in 2010. That legislation created grant
programs within the Department of Energy for scientists and engineers, as well as
math- and science-based intern programs
(AOGR, April 2007, pg. 47).
Specifically, Alexander says, his legislation would:
* Authorize a 4 percent increase in annual funding for DOE's Office of Science
and ARPA-E (Advanced Research Projects Agency-Energy);
* Eliminate six DOE programs that
were never fully implemented and reform
five others; and
* Fund a competitive grant program
for scientists.

Crude Oil Exports
S 1312, the Energy Supply and Distribution Act, states that "any domestic
crude oil or condensate . . . may be exported without a federal license to countries
not subject to sanctions by the United
States," although the text adds that "nothing in this section limits the authority of
the president . . . to prohibit exports."
The Crude Oil Export Equality Act defines the president's authority "to impose
restrictions on crude oil exports, (such as)
licensing requirements, for up to one year
under certain special circumstances, including national security threats, national emergencies, sustained crude oil shortages, and
when supply shortages or price increases are
likely to negatively impact employment."
Senator Heitkamp, who is a subcommittee ranking member on the Senate
Committee on Banking, says she crafted
her bill specifically to be referred to the
Banking Committee "with the intent to
merge it with the initial MurkowskiHeitkamp legislation to lift the U.S. oil export ban."
"The new bill seeks to reinforce the
need to lift the oil export ban by going lineby-line through federal laws to strike
any mention of or reference to the prohibitions on crude oil exports," Heitkamp
says.
She adds that another section of her bill
orders the Government Accountability Office to study the impact crude oil exports
have on energy production, consumers, independent refiners, and shipbuilders and
ship repair yards.
A third bill introduced by Murkowski,
S 1224, the Condensate Act of 2015, directs the secretary of energy to develop a
standard definition of "condensate" and expresses the sense of Congress "that

processed condensate is a petroleum product."
Industry groups lauded the export
bills. A letter signed by the Independent
Petroleum Association of America, American Exploration & Production Council,
U.S. Oil & Gas Association, American Petroleum Institute and Producers for American Crude Oil Exports, as well as the U.S.
Chamber of Commerce, suggested exports
would help keep U.S. production on
course.
"Production growth cannot continue at
expected rates if the market is curtailed,"
the groups wrote. "Much like the export
of gasoline and diesel fuels helps keep refining jobs in America, oil exports will enable the United States to invest in more
American shale development and keep
those good jobs here."
The associations also point to national security advantages, saying, "Providing
U.S. crude exports to our allies and trading partners weakens the power of unstable and unfriendly nations to manage
crude oil supply, to dictate prices, and to
use their oil as a lever against our allies to
the detriment of our nation's international interests."
National Stripper Well Association
Chairman Mike Cantrell observed that exporting U.S. crude oil would "provide
greater options to America's allies, and
strike a blow against nations that fund terrorism."
"This legislation will allow our domestic energy producers to compete with. . .
state-owned corporations on the international market," Cantrell adds.
Domestic Energy Producers Association Chairman Harold Hamm calls the export bills "a huge step forward" and urges
industrywide support. "The key to securing congressional action to lift the export
ban is maintaining pressure on the political process," encourages Hamm.
Offshore Access
Senator Murkowski also led the way in
introducing legislation to open more of the
OCS to oil and gas. She joined Senators
Bill Cassidy, R-La., and Mark Warner, DVa., in introducing S 1278, the Alaska Outer Continental Shelf Lease Act; S 1276,
the Offshore Energy and Jobs Act; and S
1279, the South Atlantic Energy Security Act, respectively.
Murkowski's bill, according to her office, requires the Bureau of Ocean Energy Management to include a minimum of
three lease sales in each of the Beaufort

American Oil and Gas Reporter - June 2015

Table of Contents for the Digital Edition of American Oil and Gas Reporter - June 2015