The battle over the expensing of intangible drilling costs (IDC) looks as if it’s going the way of independent producers, Anadarko Petroleum Corp. CEO Jim Hackett said Tuesday.

During a conference call with financial analysts, Hackett was asked about his visit last week with President Obama along with other energy industry executives. Hackett said he is “pretty sure” the administration’s recently proposed budget — which favors renewable and nuclear energy — “won’t come out the way it’s been proposed, just like it didn’t last year.

“I think the independents [producers] are in a good place with regard to arguing on the IDCs, which is the biggest issue there by far.”

Obama’s budget proposal to repeal in fiscal year 2011 $36.5 billion in tax breaks for the oil and natural gas industry — notably the expensing of IDCs, which independent producers contend is critical to their business — will meet with resistance in Congress, according to energy analysts with FBR Capital Markets (see Daily GPI, Feb. 3; Feb. 2).

Expensing of IDCs is said by the energy industry to encourage domestic drilling and production by allowing oil and gas producers to write off the expenses that typically account for more than two-thirds of the cost of bringing a well to production.

Hackett also told the analysts he was impressed by the president’s mention of offshore oil and gas leasing during his State of the Union address last week. He also noted that Obama spoke up for natural gas when he met with Republican representatives after the State of the Union.

“I think it was nothing but productive,” Hackett said of the meeting with the president. “And I have some confidence that as we play offense with natural gas, we may be playing some defense, too.”

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