Archive Logo.jpg

August 09, 2006

USA Today... seeing only half the picture.

Responding to an electorate unhappy with high gasoline prices, Congress is showing signs of breaking the not-in-my-backyard syndrome. The Senate voted last week to open 8.3 million acres in the Gulf to drilling. A House bill passed in June would effectively end the moratorium and allow drilling on most of the outer continental shelf in the Atlantic and Pacific. Legislators will try to iron out a compromise when they return to Washington next month.

Full Editorial Here.

As someone who has studied the oil infrastructure of this nation in a previous worklife, this is only a partial solution. Just pumping crude into a barrel isn't enough. You have to refine it - and refining capacity has not expanded to meet demands, either. For all the same reasons we've not been drilling. Spot prices around the country aren't just related to tax schemes. It's also related to production costs and transporation costs, with those areas farthest away from refining capacity, whether a logical result of geography or the result of policy (can you spell California?) paying for those decisions or locations.

Just putting it into storage tanks is insufficient. USA Today is also going to have to support construction of new refining capacity - and the sooner that's done, the quicker older refineries can be taken out of service and shut down/cleaned up or updated with newer, more environmentally friendly technology.

Of course, while we're doing *that* we can start the NIMBY fights over distribution channels...