More Proof of Republican Corruption
Bush Pulls Support; Sugar Land Group Still Hopes To Land $500 Million Project
by Bob Dunn, Feb 19, 07:48 am
The Bush administration has pulled support for a 10-year, $500 million deep-water oil and gas research project that a Sugar Land consortium is trying to win, and an Oregon senator has introduced legislation to kill it.
But despite a grim portrayal in Friday’s Boston Globe, industry and government sources say the “Ultra-Deepwater and Unconventional Natural Gas” project is very much alive, as are chances that a Texas Energy Center tenant could win it.
Under provisions of the energy bill passed by Congress last summer, the project would be awarded through a competitive bid process.
Both local officials and critics of the project say wording in the energy bill gives an edge to Research Partnership to Secure Energy for America, a non-profit consortium of universities, energy and technology companies headquartered at Sugar Land’s Texas Energy Center.
If awarded to RPSEA, the project could give traction to economic development officials’ dreams of turning TEC into the energy industry equivalent of Houston’s Texas Medical Center.
A Department of Energy spokesman told the Globe that the $500 million project was to have been funded by an oil and gas leasing program the Bush administration also wants eliminated, so there would be no funding source.
“The oil and gas programs were ‘not demonstrating clear results,’” the newspaper reported, “and the administration was determined to eliminate ineffective programs to pare the budget.”
But funding for the Ultra-Deepwater project already became law when President Bush signed the 2005 energy bill. A provision for the project was inserted into the bill during last-minute House-Senate negotiations.
U.S. Rep. Tom DeLay, R-Sugar Land, house majority leader during the crafting of the energy bill, was said by some observers to have been instrumental in getting the Ultra-Deepwater project inserted in the bill, which was sponsored by Republican Texas Congressman Ralph Hall of Rockwall.
Both Texas congressmen signaled that the Bush administration’s intention to kill the project notwithstanding, any report of its death is premature.
“Mr. DeLay has every confidence in the congressional budget and appropriations process,” DeLay spokesman Michael Connolly said on Friday. “The administration has made its request known, and now Congress has the responsibility to decide which programs are actually funded.”
U.S. Sen. Ron Wyden, D-Ore., has introduced legislation to kill the Ultra-Deepwater project, but chances of such a bill passing through the Republican-dominated Congress aren’t seen as great.
RPSEA board member Melanie Kenderdine, who’s also vice president of the Gas Technology Institute, said she’s as optimistic of the consortium’s chances of winning the Ultra-Deepwater project as ever.
“The president’s budget request is, as always, just one step in a lengthy process,” she said. “Furthermore, this program is outside the appropriations process, and in order to defund it, you would have to repeal a law – the energy bill.”
Kenderdine said the RPSEA prepared and submitted its bid package for the Ultra-Deepwater project, and the award winner is expected to be announced in May.
Provisions in the Ultra-Deepwater project call for setting up a trust fund paid for by oil and gas royalties. Project funding is set at $50 million in annual directive spending over 10 years, she said, and a potential additional $100 million per year via congressional appropriation.
However, the winner of the project award will only receive 75% of that amount, with 25% – or $12.5 million a year in directive spending – going to the National Energy Technology Laboratory in Morgantown, W.Va.
Greater Fort Bend Economic Development Council President Jeff Wiley said the council agrees with Bush administration goals to cure the country “of our oil addiction,” and believes the Ultra-Deepwater program would provide stability while the country works to achieve independence from foreign oil producers.
The program would in part fund the development of technology used to affordably extract oil and natural gas from waters 5,000 feet or deeper in the Gulf of Mexico. The program would also develop “unconventional” technology to, for instance, extract natural gas from on-shore shale deposits.
Being able to tap previously unreachable reserves arguably would help insulate consumers from oil price spikes, to which the United States is more vulnerable in proportion to its dependence on foreign oil.
“We remain committed to supporting the program,” Wiley said. “I believe the program is needed, that it will benefit the Texas and Gulf Coast economy and that we look forward to it being implemented.”
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