Democratic News

Oct 30 2001

Filling the Strategic Petroleum Reserve

Statement by Chairman Jeff Bingaman

Energy Committee Chairman Jeff Bingaman today reiterated his longtime support for filling the Strategic Petroleum Reserve (SPR) with federal royalty oil: “With oil prices declining and tensions in the Middle East rising, I have urged President Bush to act quickly to fill the Strategic Petroleum Reserve with in-kind royalty oil. While none of us knows if America’s oil supplies will be disrupted because of problems elsewhere in the world, it is a risk that we cannot ignore. Americans would be getting additional energy insurance at a fair price if we act now to finish filling the SPR. Given the history of inadequate appropriations for oil purchases, using in-kind federal royalty oil to fill the reserve is the reasonable and wise course for the Administration to follow.” Since enactment in 1975, the Energy Policy and Conservation Act has authorized the Secretary of Energy ‘to place in storage, transport or exchange crude oil which the United States is entitled to receive in kind as royalties from production on Federal lands.’ That authority was not used until 1999, when the Department of Energy initiated a program to take 28 million barrels of royalty oil. “At the time,” Bingaman said, “our Committee noted that 28 million barrels would only replace the oil sold during the 1990s for budgetary reasons, and we urged the Energy Department to work with the Department of the Interior to continue filling the remaining unused capacity in the SPR with royalty oil. That program was suspended when supplies were tight and prices were high, as it should have been. But now it’s time to resume that program and be better prepared to meet any future energy threat to our nation.” # # #