Texas Register, Volume 2, Number 12, Pages 507-562, February 11, 1977 Page: 555
507-562 p. ; 28 cm.View a full description of this periodical.
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555
Therefore, it is recommended that development of the
nation's coal resource must be with due regard for the
environment, but without excessive regulatory bar-
riers, and that leasing of federal coal lands which are
held in public tru4t should proceed so as to maximize
the national benefits of our coal resources. Since leas-
ing alone is not adequate to insure production, it is
recommended that the requirement of due diligence in
order to encourage the timely development of these
lands be supported. It is further recommended that
programs for leasing of federal coal lands should recog-
nize the economic, environmental, and social charac-
teristics of the states which will be affected by this
development and that federal agencies should coordi-
nate their efforts with state and local governments in
these areas so that this development for the nation's
good will not place an unreasonable burden on in-
dividual states.
Crude oil production anid pricing
It is recognized that government-administered pricing
systems in a market economy are necessarily arbitrary
and difficult to maintain: that continued changes in the
rules.and guidelines required by changing production
and world market conditions lead to inequities among
owners of price-administered products; and that fre
quent changes in administered prices have introduced
great uncertainty into the crude oil market, thus affect-
ing the effort devoted to new exploraaun It is also
recognized that deregulation of crude oil prices would
stimulate a greater supply of total energy by increasing
oil supplies, hastening development of alternate fuels.
providing more price competition among major oil com-
panies, and lessening our national dependence on
foreign sources of supply which is currently exerting in-
creased adverse pressure on the balance of trade. It is
further recognized that crude oil production from prim-
ary recovery operations is steadily declining in the
United States. that there is no inexpensive and readily
available substitute for many uses of crude oil products;
that a significant addition can be rrittdt to our crude oil
reserves from enhanced recovery techniques; that
prices controlled significantly below the current
market level will retard the application of enhanced
recovery projects and require equal quantities of crude
oil to be imported from foreign sources thereby increas-
ing our nation's vulnerability to OPEC embargoes; and
that enhanced recovery will likely result in lower
energy costs to consumers, than would continued
reliance on petroleum imports.
It is further recognized that prices will rise for
petroleum products under these policies, but in the long
term, the energy cost for consumers will be decreased
relative to the alternative of continued price controls
since new supplies of oil and gas will be discovered and
produced to replace high-priced foreign oilTherefore, it is recommended that there be an orderly
elimination of government-imposed price controls on
crude oil at the earliest possible date. It is also recom-
mended that enhanced recovery operations should.
whenever possible, avoid the use of fresh water. It is
further concluded that decontrol of prices of crude oil
from enhanced recovery operations is especially impor-
ta'Ht and would facilitate the generation of capital re-
quired by producers for enhanced recovery investments
resulting in increased production of domestic crude oil
to replace imports. The decontrol of prices is essential
to the return of business investor confidence n:.:,.xsary
for new development.
Refined product and natural gas liquids
It is recognized that government administered pricing,
systems in a market economy are necessarily arbitrary
and difficult to maintain, that continued changes in the
rules and guidelines required by changing production
and world market conditions lead to inequities among
owners of price administered products, and that fre
quent changes in administered prices have introduced
great uncertainty into the refined products and natural
gas liquids market thus interfering with the effective
market place mechanism It is also recognized that
deregulation of product prices would stimulate a
greater supply of total energy hv increasing supplies.
hastening development of alternate fiels,. providing
more price competition among oil companies and
lessening our national dependence on foreign sources of
supply which is currently exerting increased pressure
on the balance of trade
Therefore, it is recommended that there he an immedi
ate elimination of government imposed price and
allocation controls on refined products and natural gas
liquids as administered by the Federal Energy Adminis
tration In order to facilitate the smooth transition and
to insure adequate public protection, it is felt that con
tinuation of standby control and the maintenance of a
state controlled set aside program is essential to pro.
vide for emergency conditions.
Divestiture
It is recognized that federal legislation has been pro-
posed to break up large integrated oil companies into
separate production, transportation, refining, and
marketing units (vertical divestiture,. and to force the
major oil companies to divest themselves of the develop
ment of alternate energy sources such as coal and
uranium (horizontal divestiture). It is also recognized
that while the oil industry is vertically integrated. it is
still less concentrated than most other major indus-
tries. It is further recognized that divestiture may
reduce the necessary capital available for developing
energy alternatives.
It is believed that vertical divestiture would weaken the
nation's petroleum industry and thus reduce alreadyV,Ilun' 2. N.mh, 12 Fb'.. r,,/,, I I !',7
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Texas. Secretary of State. Texas Register, Volume 2, Number 12, Pages 507-562, February 11, 1977, periodical, February 11, 1977; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth252905/m1/49/: accessed July 18, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.