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McCain Pledges to Attack Energy Problem on 'Every Front'

Republican presidential contender John McCain and running mate, Alaska Gov. Sarah Palin, joined forces last week at the Republican National Convention to express their support for domestic oil and natural gas drilling.

"We will attack the [energy] problem on every front. We will produce more energy at home. We will drill new wells offshore and we will drill them now," McCain told Republican delegates in St. Paul, MN. "We will build more nuclear power plants. We will develop clean coal technology. We will increase the use of wind, tide, solar and natural gas. We will encourage the development and use of flex fuel, hybrid and electric automobiles."

Democratic presidential hopeful "Sen. Barack Obama thinks we can achieve energy independence without more drilling and without more nuclear power. But Americans know better than that. We must use all resources and develop all technologies necessary to rescue our economy from the damage caused by rising oil prices," McCain said.

Palin said the United States has "lots" of oil and natural gas and called for more domestic exploration and production during her speech last Wednesday night. "To confront the threat that Iran might seek to cut off nearly a fifth of world energy supplies, or that terrorists might strike again at the Abqaiq facility in Saudi Arabia, or that Venezuela might shut off its oil deliveries, we Americans need to produce more of our own oil and gas. And take it from a gal who knows the North Slope of Alaska, we've got lots of both."

When a hurricane batters oil and natural gas facilities in the Gulf of Mexico, "this country should not be so dependent on imported oil that we are forced to draw from our Strategic Petroleum Reserve," said Palin, who would be the first woman elected as vice president if the Republicans win in November.

"Our opponents say, again and again, that drilling will not solve all of American's energy problems, as if we all didn't know that already. But the fact that drilling won't solve every problem is no excuse to do nothing at al.,".

Although she did not address the issue in her speech, Palin previously stated that she supports removing the 27-year-old congressional moratorium on offshore oil and gas drilling, as well as opening part of the Arctic National Wildlife Refuge to development. In mid-June, McCain publicly declared that he favored lifting the ban to give coastal states the option to permit exploration off their shores (see NGI, June 23).

As Alaska's governor, Palin has been at the forefront of efforts to build a pipeline that would bring natural gas from the North Slope to markets in the Lower 48 states. "I fought to bring about the largest infrastructure project in North American history. And when that deal was struck, we began a nearly $40 billion natural gas pipeline to help lead America to energy independence," she said.

"The pipeline, when the last section is laid and its valves are opened, will lead America one step farther away from dependence on dangerous foreign powers that do not have our interests at heart. The stakes for our nation could not be higher."

Both TC Alaska and Denali, a partnership of BP and ConocoPhillips, separately have offered proposals to build a 1,750-mile pipeline to deliver natural gas from the North Slope to North American markets via the Alberta Hub in Canada. The companies expect to file applications at the Federal Energy Regulatory Commission in 2011, with both seeking a certificate in 2013 (see related story).

In addition to increased drilling, Palin pledged that "starting in January, in a McCain-Palin administration, we're going to lay more pipelines, build more new clean plants, create jobs with clean coal and move forward with solar, wind, geothermal and other alternative sources."

There is some controversy, however, about Palin's tax policy with respect to producers. As governor Palin pushed a tax proposal through the state legislature that mirrors what Obama is proposing on a national scale, CQ Today reported. She used some of the tax proceeds to provide a $1,200 rebate to Alaskan residents this year as energy prices rose.

Douglas Holtz-Eakin, McCain's policy director, told CQ Today that Palin's Alaska tax policy would not conflict with McCain's opposition to a windfall profits tax for producers. He noted that Palin's proposal was intended to reverse policies implemented under the taint of a state corruption scandal involving influence from the oil industry.

"It's a permanent change. It's not an opportunity grab for 'windfall profits,' and I think that's a fundamental difference in the approach. She was trying to set the state up for both good and bad times in the oil industry, and that's very sensible," Holtz-Eakin said.

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