Interstate Oil and Gas Compact Commission - Dec. 16, 2002

Thank you. It’s my pleasure to join you this morning and to welcome you to Arkansas.

It’s my pleasure also to be joined this morning by my friend and fellow Arkansan Governor Mike Huckabee, and by Gov. John Hoeven.

I’d like to congratulate Gov. Hoeven on his ascension to the chairmanship of the commission, and I’m confident that he’ll be able to build on Gov. Huckabee’s leadership.

And in today’s global environment, leadership is exactly what we need in our energy policy.

With our nation currently embroiled in a war against international terrorism, and facing other possible military action in the Middle East, energy independence is more crucial now than ever before. This fact certainly applies to our production of oil and natural gas.

With turmoil in many of the world’s major oil-producing nations, and with demand for oil and natural gas increasing yearly, we must take steps to stabilize our current inventory and production of oil in the United States. And we should accomplish this goal while preserving our energy supplies and our environment for the future.

That’s why this year’s conference theme – “Leading Environmental Responsibility” – is so appropriate for this time and place. We’re all well aware that we are not in a position to produce oil or gas wherever we might find it.

And that’s all the more incentive to maximize production from our current sources, particularly the smaller “marginal” wells that play such a key role in providing our oil and gas.

These smaller wells are scattered throughout Arkansas and the other oil-producing states, and have consistently provided the necessary resources to help fuel America’s economy. We must therefore look for ways to keep these marginal wells pumping even when times get a little tough.

And we need to find ways to strengthen our nation’s energy infrastructure so that we can expand our level of production and get those products to market more swiftly.

Some of us in Washington have fought to develop a new energy plan. We spent an exhaustive two years writing an energy bill that included many provisions and incentives necessary to keep this nation’s energy infrastructure growing. However, as you all know, we were ultimately unsuccessful this year in merging the House and Senate energy bills, so we’re going to have to fight that battle again next year.

In the Senate, we included language to ensure we can continue using hydraulic fracturing for oil and gas operations. As many of you know, without this technique we almost couldn’t produce oil or gas in Arkansas.

We also included tax incentives for production from marginal wells, extension of Section 29 tax credits for hard-to-reach fuels, and incentives to increase energy production across the board.

I’m going to fight for all of those provisions again in 2003.

I fully expect that we can pass an energy bill with tax incentives for production and renewable fuels, as well as provisions to strengthen our energy infrastructure.

I want to continue to ensure that our small oil and gas producers have the incentives to continue to operate even through difficult economic times.

We also need to continue to promote the transfer of technology from government research agencies to small, marginal well producers. Applying government-funded new technologies to small, marginal well operations will continue to play a large role in helping to keep our marginal wells open. Opening the doors to new technology will help small marginal producers quickly reduce costs, improve operating efficiency, enhance environmental compliance, and add new oil and gas reserves.

I was also pleased to see that you have the Integrated Petroleum Environmental Consortium hosting a workshop on environmental compliance for small oil and gas producers. This joint effort between the University of Arkansas and other universities to help solve environmental problems within the oil and gas industry promises great benefits for both small and large producers. Groups like IPEC are a necessary part of ensuring that the small oil and gas producer has access to the knowledge and know-how to operate in an efficient and environmentally safe manner. It’s a perfect example of how the public and private sectors can work together to develop effective, non-regulatory solutions.

I look forward to hearing about more of IOGCC’s ideas for helping our producers to operate more efficiently while protecting our environment.

I know you all have a busy day planned so, so I’d like to end now with a word of thanks.

Thank you for your hard work in helping to meet our nation’s security needs, and thanks for taking up the responsibility of protecting our environment for future generations. I look forward to working with all of you in the years to come.