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IOGCC Calls for National Energy Policy to Address Cost

IOGCC Calls for National Energy Policy to Address Cost

Coming at a time when a national plan is gathering more support as energy prices have escalated at the pump and in homes and businesses, the governors of the 30 U.S. oil and gas producing states have begun their push for an official national energy policy, offering their own four-pronged strategy.

The Oklahoma City-based Interstate Oil and Gas Compact Commission (IOGCC), which represents the governors of the 30 states, said it wants to call attention to the potentially tight natural gas market expected this coming winter as well as the high costs put on the nation from imported oil, and said that an energy policy is the best way to ensure problems are contained ahead of time.

The four recommendations include the following: methods to assess the costs of imported oil; increased research to ensure that domestic oil and natural gas resources are developed to their full potential without sacrificing environmental protection; tax incentives to encourage more domestic exploration and production, modeled after successful state programs like Alaska's; and "encouraging" the public to use energy efficient technologies to conserve the limited supply of fossil fuels in the United States.

Oklahoma Gov. Frank Keating and North Dakota Gov. Ed Schafer led the group's call for a policy last week, and they also underscored the need for a "full" discussion about the nation's energy future.

"The time for a national discussion is at hand and we invite citizens and leaders at all levels of government to join us," Keating and Schafer said in a statement.

Two things high on IOGCC's agenda to be included in the national energy policy are repealing net receipts sharing, and giving states more environmental protection authority.

IOGCC Vice Chairman Lawrence E. Bengal in June advocated the repeal of net receipts sharing, calling it an "ill conceived, costly and burdensome program from its inception." Bengal then urged members of Congress to enact HR 4340, which would replace net receipts sharing by giving half of the royalties to the states and half to the federal government without first deducting federal administrative charges.

Net receipts sharing requires states to share the federal cost of managing onshore mineral royalties. It was mandated by the 1993 Omnibus Budget Reconciliation Act, and before it was enacted, royalties were split equally between the states and the federal government. In 1999, the IOGCC passed a resolution supporting the repeal of net receipts sharing.

In May, IOGCC's Alaska Gov. Tony Knowles led the call to support New Hampshire U.S. Sen. Bob Smith's plan to give the states more regulatory power when it comes to environmental protection.

"State regulators have successfully shown they can identify their own environmental issues and have developed creative solutions to tackle those issues," Knowles said. "In Alaska, for example, we are proving you can develop the nation's largest oil fields while maintaining the nation's most pristine environment."

Carolyn Davis, Houston

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