At least three oil companies announced yesterday they were shutting in some production as Ida began to bear down on oil and natural gas facilities in the Gulf of Mexico. BP, Chevron and Marathon reduced production and evacuated some of their offshore facilities. Also, the Louisiana Offshore Oil Port (LOOP) stopped offloading tankers as sea conditions began to deteriorate.

At 9:00 a.m. central time this morning, Ida was downgraded to a tropical storm. According to a National Oceanic and Atmospheric Administration (NOAA) bulletin, the storm is expected make landfall along the northern Gulf coast on Tuesday morning and turn east, delivering heavy rain to the Southeast portion of the United States.

Whenever there is a threat from a hurricane or tropical storm, the oil and natural gas industry... more »

Did you know that the top economist at the U.S. Treasury believes the United States is producing too much oil and natural gas?

As Alan Krueger recently told a Senate panel, the United States has an "overproduction of oil and natural gas" because U.S. tax policies encourage "an over investment in domestic resources in this industry." Krueger said taxes should be raised on the oil and natural gas industry to make it more "efficient" and to meet the administration's goal of reducing the consumption of fossil fuels.

It doesn't take a government economist to understand the impact of Krueger's words. Common sense indicates that by raising taxes, the government would raise the cost of doing business. And as costs rise, companies have less capital to grow their businesses and hire more workers.

No... more »

The Committee on Natural Resources in the U.S. House of Representatives held a hearing today on a proposal called the Consolidated Land, Energy and Aquatic Resources Act of 2009. While it's often referred to as an energy bill, it's actually an Un-Energy bill.

If passed, this bill would consolidate the leasing functions of the Minerals Management Service (MMS) and the Bureau of Land Management (BLM) into a single office at the Interior Department. At present, the MMS manages the leasing of offshore land for energy development, and the BLM manages a similar process for onshore leasing.

Combining the two agencies would not present a problem if it would improve the efficiency of oil and natural gas development. But this bill would add another layer of bureaucracy and could jeopardize the devel... more »

Today, U.S. Interior Secretary Ken Salazar announced that he would terminate the Royalty-in-Kind (RIK) program, which collected $6.6 billion in oil and gas deliveries in fiscal 2008, and is one of the government's largest sources of non-tax revenue. The program is an effective means of ensuring that the American people receive fair compensation for development of federal resources.

Terminating this straight-forward method of handling royalty payments runs the risk of raising administrative costs and adding additional layers of paperwork required to determine the value of oil and gas production. The Minerals Management Service itself noted administrative efficiencies brought on by the program, and pointed out that another benefit of RIK is the reduction in costly lawsuits tied to product va... more »