A pitch is being made today to the national press in
Washington, D.C., by independent oil and gas leaders about the dire
state of affairs within the domestic energy industry.
Independent Petroleum Association of America Chairman Eugene
and President Denise Bode, who is an Oklahoma native, are
speaking before the National Press Club on "The State of the
Domestic Industry: U.S. Oil and Gas Policy at a Crossroads." It is
not a pretty picture, as has been reported lately, and the reaction
of Capitol Hill press is anyone's guess. These days, lawmakers
certainly don't seem to want to talk about energy. They tend to
harp more on issues like health care as election day nears.
Nearly every indicator of the strength of the domestic oil and
gas industry are now at historic lows _ the rig count, seismic crew
count, supplies inventories, well servicing activity, available
The experts who compile those statistics are predicting further
slumps for 1992 _ unless there are some dramatic changes in U.S.
energy policy, that is.
Last September, though, the U.S. Senate didn't blink, and
indeed seemed to welcome, the chance to put off a debate on the
omnibus energy bill that was borne out of President Bush's National
Energy Strategy. Not surprisingly, it will be an issue that pits
energy interests against the extremist environmental ones. The
attitude of lawmakers is not surprising either. For at least two
years prior, two Oklahoma lawmakers, Sens. David Boren, a Democrat,
and Don Nickles, a Republican, have had energy bills aimed at
sustaining the domestic industry lay dormant for lack of interest.
A month after the Senate scrapped the mega energy bill, though,
Congress' Office of Technology Assessment issued its update on the
nation's oil import vulnerability. It had been nearly 10 years
since the 1984 report was reviewed.
Well, the picture is clear. There is no way to cloud the facts.
"The OTA's October 1991 report," Ames said in a letter to Sen.
J. Bennett Johnston, D-La., who is chairman of the Energy & Natural
Resources Committee, "raised concerns about the United States'
growing oil import dependence and eroding oil replacement
"One of the OTA's principal conclusions _ `Declining domestic
crude oil production threatens to exacerbate any oil import
shortfall' _ deserves further examination and prompt action by the
Congress." In fact, Ames added that government assessment of the
demise facing the domestic oil and gas industry is probably
understated. It has been noted by the leadership of Oklahoma
independents that the scenario facing the U.S. and its domestic oil
and gas industry is eerily similar to that of the early to
mid-1970s just prior to the first Arab Oil Embargo.
"While the OTA observed in general terms the decline in U.S.
oil production, it did not provide detailed insight into the state
of the U.S.
industry. The situation is probably worse than OTA found," Ames
"Almost all of the statistical indicators of activity in the
domestic exploration and production industry are at modern-time
lows." The rig count in 1991 was the lowest since 1942 as World War
II raged and steel was diverted from the oilpatch for the war
Monthly seismic crews have fallen to the lowest since that
gauge of activity has been tracked, 1974.
Well servicing is down 20 percent from the most recent peak in
December 1990 and continues to fall.
Drilling and production equipment has been sold to overseas
operators or has rusted out.
"Even if the domestic industry had enough equipment, it still
would be limited by the shortage of qualified personnel," Ames
Oil and gas employment, in extraction only, has plummeted a
"shocking" 50 percent, with more than 300,000 jobs gone, since the
peak year of 1983, he said. The trend is growing in magnitude, too. …