Rocky Mountain oil and gas firms say regulatory certainty is a key provision in an energy bill with otherwise modest benefits for Western producers.
The 1,725-page bill that Congress is expected to vote on this week directs federal officials to develop specific time frames for processing leases and applications for drilling.
That has been a sore point for energy executives who say delays and unpredictability in permit processing slow the production of oil and natural gas.
“It’s relief from uncertainty, and that would be good for the energy industry,” said Krista Johnson, director of governmental affairs for Denver-based Western Gas Resources.
She said the firm’s production of natural gas from the prolific Powder River Basin in Wyoming was curtailed from 2000 through 2003 because of permitting delays while federal officials deliberated over the region’s energy development plan.
“I don’t know if (energy production) will be any faster, but it will allow us to better plan for assumptions such as when wells will be drilled and where,” Johnson said. “Instead of having government procedures dictating our business plan, we’ll be able to make decisions based on sound business practices.”
The new energy bill does not dictate the allowable time periods for issuing permits but directs federal bureaucrats to review the process and implement specific time frames.
Government officials have streamlined their permitting functions in recent years, but there is still room for improvement, said Jim Volker, chief executive of Denver-based Whiting Petroleum.
“I think they’re better in the sense that the process is not getting longer in the face of increased numbers of applications,” he said. “But everyone would like it to go faster.”
The bill focuses less on Rocky Mountain energy issues and more on offshore energy development, use of coal and nuclear fuel for electric generation, and ethanol production, said Greg Schnacke, executive vice president of the Colorado Oil and Gas Association.
Environmental advocates were critical of many of the energy bill’s provisions.
“The U.S. Congress has crafted an energy bill that fails to reduce America’s dependence on oil, fails to address the threat of global warming, fails to make any new investments in clean energy, and by the president’s own admission, fails to help consumers at the gas pump,” Environment Colorado said in a statement.
The Cato Institute, a Washington think tank, criticized the bill’s $11.5 billion in tax breaks for energy producers.
“The bill is larded with subsidies, tax preferences and miscellaneous handouts to an energy industry that – with prices this high – are in no need of taxpayer assistance,” said Cato spokesman Jerry Taylor.
Staff writer Steve Raabe can be reached at 303-820-1948 or sraabe@denverpost.com.
