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Richardson says rough times in oil industry may be easing U.S. Energy Secretary tells independents that changes have opened investment opportunities for them overseas Bruce Smith Associated Press Writer
U.S. Energy Secretary Bill Richardson says the rough times in the nation’s oil industry may be easing and that independent producers should look for opportunities overseas.
“I say, and I say this guardedly, I think we’re seeing some hopeful signs,” Richardson said May 11, noting oil prices have rebounded somewhat in recent months.
“Domestic oil and gas production is key to our economic energy and national security,” he told a meeting of the Independent Petroleum Association of America in Charleston. “Addressing low oil prices requires balancing energy, economic and national security issues.”
52,000 U.S. jobs lost Oil prices dropped because of lower demand after economic problems in Asia and warmer winters, increased production by some foreign producers and resumption of Iraqi oil exports.
Since November 1997, the industry has lost 52,000 jobs and shut down 136,000 oil wells and 59,000 gas wells, according to the association. It represents 8,000 crude oil and natural gas producers in 33 states.
Richardson said major oil companies have shifted more of their investment to overseas exploration and production, partly because of lower costs. In addition, recent mergers among the industry’s largest companies may give independents an opportunity to acquire smaller domestic wells. Independents get larger share U.S. production “It stands to reason that, as the majors look elsewhere, independent production will likely represent an ever-larger share of our domestic production,” Richardson said. “Our policies of enhancing domestic production converge with the needs and interests of independent producers.”
However, he said independent producers also need to look for niches overseas. “There is just real opportunity around the world. I know we have to take care of things here at home — but internationally, you guys need to look out a little more. Especially if these mergers happen, I think there will be more opportunity for you overseas,” he said.
Richardson said the future looked bright for the Savannah River Site nuclear complex near Aiken. It was selected last year for a $500 million plant to disassemble plutonium pits of nuclear bombs and for a mixed oxide fuel fabrication plant — projects expected to mean a $1 billion investment and 1,000 permanent jobs.
“We appreciate that you have been taking the nation’s waste and asking for little in return,” Richardson said.
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