A solid article in today’s Hattiesburg (Miss.) American newspaper, “Full impact of oil, gas production will take time to measure”. Rather than stopping with the quick environmentalist talking point — “This bill will do nothing to lower the price of gas at the pump” — the reporter seeks answers to important questions: How soon could new supplies of natural gas or oil flow from the Gulf of Mexico if Congress passes energy legislation this year? What would the new supplies do to price? How much economic activity would result from the new exploration and development?
“It would help the industry and help the consumers, but all of that is down the road,” said Joe Sims, president of the Jackson-based U.S. Oil and Gas.
Michael Kearns, spokesman for the National Ocean Industries Association, said it would take at least three years for any of the natural gas in the new drilling area to reach markets.
But, in lobbying for the bill on Capitol Hill this week, John Engler, head of the National Association of Manufacturers, said the effects of allowing new exploration and production would be felt almost immediately because it would becalm a very volatile futures market. The futures market allows buyers to lock in a price of a natural gas or oil for delivery in a future month.
Kearns concurs with that latter point, “It would calm down long-term fears about supply.”
Calming the volatility in the natural gas market would help manufacturers plan and make better-informed production and investment decisions. While not a tart, dismissive sound-bite, it’s reality. We appreciate the Hattiesburg American’s reporting on this issue and the many others that arise from congressional passage of OCS legislation.
UPDATE: Turns out the story originated with Gannett’s Washington, D.C., bureau, and is appearing in Gannett papers around the country. Good!