Electric Transmission Property Depreciation

Floor Speech

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Mr. CORNYN. Mr. Chairman, I rise to speak to an amendment I have filed to address the Bureau of Land Management's policy toward development of much needed oil and gas resources in the potash reserve. Notwithstanding the strong bipartisan consensus that the U.S. must expeditiously develop its readily available domestic oil and gas resources, for decades the Bureau of Land Management has restricted development of large volumes of oil and gas located in the Known Potash Leasing Area near Carlsbad, NM. BLM has authority to permit compatible oil and gas development in conjunction with potash mining in the area, but the agency has failed to do so due to asserted concerns with adverse impact on potash mining reserves and mine safety. For a long time the oil and gas industry has had the technical ability to drill in the potash region without creating any such threat to these potash mining interests. Concerns with BLM's administration of the Interior Secretary's October 1986 order have been raised with Congress over many years. However, given the Nation's continuing economic stress due to the oil and gas price and supply situation, and the policy imperative underlying the current energy bill debate to facilitate resource development on Federal lands where Federal rules or policies have unnecessarily inhibited such activity, the time has come to expeditiously resolve the administrative problems that have impeded reasonable oil and gas development in the Nation's potash reserve.

The BLM has denied approximately 190 applications for drilling permits and applicants strongly believe that their permits have been denied without appropriate consideration of their technical ability to develop oil and gas in the potash area while not creating any safety risks to potash mining or jeopardizing economically recoverable potash reserves.

My amendment would address this disadvantage for oil and gas drilling permits in the potash area, insuring that BLM allows drilling compatibly with the interest in maintaining potash reserves and mining in the area. Specifically, my amendment would still allow BLM to deny permits out of concern for adverse impact on potash mining, but only if the agency could specify with particularity the reasons why approval of the oil and gas permit would jeopardize potash mining safety or threaten recoverable potash reserves the value of which exceeded the value of the recoverable oil and gas associated with the relevant permit.

I understand that the chairman is well aware of the protracted history of this problem and has directed his staff to investigate the situation with BLM. Indeed, this week my staff attended a meeting with the BLM State director and the Chairman's staff to discuss this issue.

I certainly could offer the amendment for a vote at this time, but may I first inquire of the chairman whether he shares my concern with the BLM policy regarding the amount of oil and gas drilling being permitted in the potash region?

Mr. DOMENICI. This has been an evolving problem for some time now and I share the Senator's concern about whether the proper balance is being struck. Particularly in light of available technologies, I believe that there should be a way to produce oil and gas in the potash area without interfering with the recovery of the potash resource. My desire is to see both a vibrant potash industry and a vibrant oil and gas industry in the region, with both generating strong economic activity and employment.

Mr. CORNYN. I share the Chairman's views and would furthr inquire whether the chairman would be willing to work with me through the course of the conference on the energy bill to assure that this problem with BLM policy is properly addressed?

Mr. DOMENICI. I would tell the Senator that I would be pleased to give him that commitment.

Mr. CORNYN. I thank the Chairman.

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