Nov. 16–Maybe it is making the best of a bad situation, but a bipartisan bill is aimed at once again dealing with the U.S. government’s schizophrenia about the Strategic Petroleum Reserve.
On the one hand, Americans want to have a reserve of oil that can be tapped in a true case of national emergency. It would be energy “in the bank,” stored in the Gulf Coast salt domes, so that our economy does not crash to a halt during a disruption of oil supplies.
On the other hand, it is energy in the bank, and Congress simply cannot keep its hands off money, in whatever form.
Instead of holding on to the oil, Congress has used it as a piggy bank, mandating sales from the reserve over the coming decade. The money to be raised will go for other purposes.
Two senators from energy-producing states, Republican Bill Cassidy of Louisiana and Democrat Michael Bennet of Colorado, have introduced the new bill that authorizes the U.S. Department of Energy to lease unused space in the salt domes to oil companies.
This seems a sensible idea. Since Congress is drawing down the reserve anyway, some revenue from leasing space in the facilities would be helpful. Two of the salt dome complexes are in Louisiana, in Iberville and Cameron parishes, and two more are in Texas.
The government estimates that about 45 percent of the salt dome storage will be available for lease once all the currently mandated sales are complete. That, of course, assumes that Congress won’t again use the reserve as a piggy bank.
No one can guarantee against short-term thinking on Capitol Hill.
The Cassidy-Bennet bill does require that any leases should not impair national security, and we are grateful for that.
But we also would point out that sales from the reserve, thus creating the lease space, are an example of short-term thinking. Maybe memories of oil and gas shortages and embargoes are distant. And certainly America, though still importing a lot of oil and gas, is a much bigger producer onshore because of advances in drilling.
The Strategic Petroleum Reserve is a hedge against really bad things happening. In times when oil is cheaper, the nation should lay in a supply. In the case of a world-shaking disruption, it might mean a difference between a manageable economic impact or a much more serious crisis.
“If the tanks are empty, let’s put them to use,” said Cassidy, a supporter of the SPR’s national security mission. That will help pay the bills and keep the reserve operating.
We cannot argue with that, but we wonder if Congress understands the necessity of insuring against worst-case international events.
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