Gingrich video on oil

[rms427]

Cobra Bill.

I agree we are all Americans but a few of your statements are not correct. The most oil sold overseas from Alaska was 7%. It actually makes sense at times because shipping costs nets the US more value than what it costs to purchase the oil elsewhere. The Alaska Oil is considered sour but only mildly so. It is not a poor quality oil which you can tell by the price they get for it. Recently it was over $140 per barrel. As for the government not getting anything for the leases. As an example the company I worked for payed 318 million for a lease offshore California back in the 80's and spent about 2 billion total to develop it and then never made back the investment. The oil companies have paid billions for leases. They also pay royalties, income taxes etc. Most of the millions of acres of land that you talk about have been picked over for years. Some are in development and some are non productive. You are correct that IF oil stays at $140 per barrel many of these leases are now viable. However, in the past oil prices have not remained high. Oil companies have gone through many booms and busts. I retired because I got tired of laying folks off because of low oil prices. The company I worked for is spending more on exploration and development than the profit they make. By the way the major oil companies do not control much oil these days. As I remember it's about 5%. Most of the oil is owned by the governments that don't like us.

I actually think high oil prices are what we need to get us off our duffs to conserve and develop alternate fuel sources. We need our own energy sources so we are not dependent on countries that don't like us. However the amounts of energy needed are mind boggling. So it won't be easy. So for the interim opening up the the North Slope and all offshore areas while developing alternates is the way to go.