Harry Reid’s UnCLEAR Legislative Move: Undermining our Energy Security?

There is a legislative drama being played out in Washington DC this week.  The Congress has a summer recess beginning after work on Friday, July 31 and returns to session Sept 14 to stay in session until October 8th. The Administration is pushing to enact the CLEAR Bill (Consolidated Land, Energy & Aquatic Resource Act) HR 3534. This Bill has the potential to increase federal regulation of all aspects of the oil, natural gas, and energy industries. It is  transforming legislation.

There may be an attempt today, 30 July, for the House Democratic majority to “Suspend the Rules” to pass the CLEAR Bill  (HR 3534). Suspension is a rapid method to pass a Bill and it requires a 2/3 rd vote of those present, with no amendments, a maximum 40 minutes debate, and the votes may or may not be recorded. The overall legislative strategy is to push the CLEAR Bill rapidly through Congress, at the latest, before the November, 2010 elections.

The Senate CLEAR Bill, which is 409 pages, was introduced earlier  by Senator Harry Reid.

The Senate and House Bills can be accessed at www.thomas.gov.  Plus the House Bill drafts can be accessed at www.house.gov by going  to Science & Technology Committee for the Majority and Minority versions of the CLEAR Bill HR 3534.

The CLEAR Bill HR 3534, HR 2693, and HR 5019 (see www.thomas.gov), will have a profound transformation of our energy industries.

These Bills will increase federal revenue substantially from the oil and gas industry; impose new drilling regulations; increase guidelines for federal employees regulating the oil and gas industry; increase royalties; and establish procedures for use of chemical dispersants.

A major issue deals with hydraulic fracturing, which is the technology used in successful shale oil and natural gas production.  The United States has massive potential shale production for oil and natural gas, hundred and hundreds of thousands of potential shale acreage production. Large amounts of fluids are necessary to “frac” the shale formations. The Administration is proposing stricter regulation of frac fluids. How this will impact the shale production is unknown.

How this legislation will impact the entire oil drilling industry is unknown. Previously, when the federal government substantially increases taxes, revenues, and regulation on an industry, it has negatively impacted the industry.