permian basin petroleum association midland, texas may 8, 2001 barry russell president independent...
TRANSCRIPT
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PERMIAN BASIN
PETROLEUM ASSOCIATIONMidland, Texas
May 8, 2001
Barry RussellPresident
Independent Petroleum Association of America
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Overview
• The Nature Of The Energy Problem
• The Issues
• Changes In Washington
• IPAA’s Role
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Major Focus: Energy Policy
• Domestic Production Of Oil And
Natural Gas
• Meeting Growing Future Demand For Energy
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U.S.Natural Gas DemandComparison of 1992 and 1999 NPC Study Results
1990 1995 2000 2005 2010 2015
YEAR
1999 NPC Reference Case 1992 NPC High Case 1992 NPC Low Case Actual
A C T U A L F O C U S P E R I O D E X T E N D E D V I E W
1999 NPC Range of Outcomes
TRIL
LIO
N C
UB
IC F
EET
15
20
25
30
35 ACTUAL FOCUS PERIODFOCUS PERIOD EXTENDED VIEWEXTENDED VIEW
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U.S. Natural Gas Demand by Sector
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
TR
ILLIO
N C
UB
IC F
EET
1990 1995 2000 2005 2010 2015
YEAR
Other
Commercial
Residential
Industrial
ElectricityGeneration
F O C U S P E R I O D E X T E N D E D V I E WA C T U A L
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0
10
20
30
40
50
60
BC
FD
* Representing 91% of US Production
Drilling Year:1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
Pre-1990
Production Decline Rate of Base:
16% 17% 15% 17% 18% 21% 23% 23%18% 19%
U.S. Production History*
1990 1991 19991998199719961995199419931992
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Natural Gas Prices(NYMEX)
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
5.50
6.00
6.50
7.00
7.50
8.00
8.50
9.00
9.50
10.00Ja
n-90
Jan-
91
Jan-
92
Jan-
93
Jan-
94
Jan-
95
Jan-
96
Jan-
97
Jan-
98
Jan-
99
Jan-
00
Jan-
01
Jan-
02
Jan-
03
Jan-
04
Trade Date
Pric
e ($
/mm
btu)
Fwd Curve Apr01 Fwd
(3/9/01)
Forward Pricing: 1 year $5.23 3 year $4.76 5 year $4.6810 year $4.75
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898
362
0
200
400
600
800
1000
1200
Oil Rigs
Natural GasRigs
Rigs Drilling for Natural Gas Have Doubled
Natural Gas Producers are Responding
488
1,125
April, 1999 February, 2001
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Issue: Building a Sound Energy Policy
• Recognize Importance Of Energy
• Establish Energy Advocacy– Require Consideration Of “Energy Impact”
In Regulatory Decision Making
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Critical Factors
• Access
• Technology
• Financial Requirements
• Skilled Workers
• Rigs
• Lead Times
• Requirements Of New Customers
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Issue: Resource Base• Knowing How Many Laws, Regulations And
Conflicting Management Plans Are In Play
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Issues: Access to Capital
• Increase Spending By $10 Billion A Year Through 2015
• Double Wells Just To Deal With Natural Gas Demand
• Retain As Much Revenue As Possible
• Old And New Tax Reforms
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What’s Going On In Washington
• Bush-Cheney National Energy Policy Task Force
• Transition Advisory Teams
• The Administration And The Agencies
• The Congress
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Our Role In The Process
• Wildcatters’ PAC
• The Transition
• Congressional Hearings
• Congressional Oil & Gas Forum
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Political Effectiveness
• Record-Breaking Fundraising
• Increased IPAA Member Involvement
• The Wildcatters Fund Contributed To 71 Open Congressional Seats And Competitive Races To Ensure A Pro-Business/ Pro-Oil & Gas Congress
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Grassroots Activism
• Voter Education Guide
• “Get Out The Vote” Campaign
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Hearings & TestimonyThe 107th Congress
• House Energy and Air Quality Subcommittee
• House Resources Committee
• House Energy and Mineral Resources Subcommittee
• Senate Energy and Natural Resources Committee
• Federal Energy Regulatory Commission
Rep. Barbara Cubin (R-Wyoming)Rep. Joe Barton (R-Texas)
Sen. Frank Murkowski (R-Alaska)
Rep. James Hansen (R-Utah)
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Congressional Oil & Gas Forum Advocacy
The Oil and Gas Forum Hosted by
IPAA on March 15, 2001
Drew 90 Participants and
7 Members of Congress
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