Energy Sec'y Says New Policies Won't Be Quick

Story Filed: Saturday, February 17, 2001 7:39 AM EST

WASHINGTON (Reuters) - U.S. Energy Secretary Spencer Abraham warned on Wednesday that Americans should not expect to see quick results from the Bush administration's plan to open an Alaskan wildlife refuge to oil drilling, a key part of a broad energy policy to boost supplies and wean U.S. dependence on foreign oil imports.

Abraham, speaking in an interview with Reuters, said the administration's energy plan was still being developed by a White House task force and would not be unveiled for several weeks. He emphasized that the proposal would encompass a broad range of measures to attack the nation's thirst for fuel.

``There isn't a special oil well somewhere that, if we simply open the spigots, would provide America with complete energy independence,'' Abraham said.

He also added: ``There isn't a big generator in the basement of the Department of Energy, or any other federal agency, that you can flip a switch and suddenly produce significant increases in electricity.''

THAN ANWR DRILLING NEEDED

The task force is headed by Vice President Dick Cheney, a former top executive of the oil drilling services giant Halliburton Co. . Abraham's boss, President George W. Bush, is a former Texas oilman.

While recommendations are expected to include Bush's campaign promise to drill for oil and natural gas in the Arctic National Wildlife Refuge (ANWR), Abraham said it was unfair to focus on only that.

``What I hate is the impression that there's no other ideas we're going to be looking at except whether or not to push for (drilling in) ANWR,'' he said.

``That will not be the only thing in our energy plan. It's only going to be one small part of a much broader, more comprehensive plan,'' he added.

Earlier this week, Massachusetts Democratic Sen. John Kerry threatened to block or filibuster any Republican legislation that includes opening the environmentally sensitive refuge to drilling. The Arctic refuge is home to caribou, polar bears and a variety of other wildlife.

Abraham said the administration will also push for the development of cleaner coal technology to fuel electric generating plants, review the permitting process for nuclear power plants and promote more renewable energy sources like wind and solar.

President Bush wants to reduce U.S. dependence on foreign oil imports, but has not set specific target levels as Senate Republicans plan to do in energy legislation that will be introduced later this month.

Under that bill, foreign oil imports would have to be reduced to just 54 percent of domestic supplies by 2005 and continue falling to 50 percent by 2010. Imports currently account for 55 percent of U.S. oil supplies and are forecast to climb to 61 percent in a decade.

``We (administration's officials) have not laid out a set of markers,'' Abraham said.

The bill, which is thought to be in line with the Bush administration's own thinking, is being drafted by Sen. Frank Murkowski, the Alaska Republican who heads the Senate Energy committee.

WANTS LOW-KEY OPEC POLICY

No matter how much oil the United States imports, a large chunk will continue to come from OPEC.

Unlike his predecessor, former energy secretary Bill Richardson, who lobbied OPEC ministers during their meetings, Abraham said he would take a low-key approach with cartel members.

``My hope is perhaps we can have less public conversations on a more regular basis to try to work together,'' Abraham said.

The Organization of Petroleum Exporting Countries is scheduled to meet again in March, when some members are expected to push for another production cut. Abraham said the administration has not had a ``full enough discussion'' to take a position on OPEC's next meeting.

Abraham, a former Michigan senator, also declined to say whether he thought the U.S. economy had slowed enough for OPEC to justify cutting production to offset less consumer demand.

``If we have something to say about it, it may come later, but I'm not saying anything at this point,'' he said.

Separately, Abraham just about ruled out the possibility

the Bush administration's would release more emergency oil reserves to build gasoline inventories for the spring and summer.

The Energy Information Administration, the Energy Department's statistical arm, has warned that gasoline supplies will be low going into the summer driving season and wild price swings in fuel costs could result.

Abraham said the administration believes the nation's Strategic Petroleum Reserve should be used only in a true supply emergency.

``We will only tap into the reserve in real emergency situations where there's a significant disruption of supply or where there's a national security challenge,'' he said.

While on the campaign trail last autumn, Bush criticized former President Clinton's decision to withdraw 30 million barrels of crude from the emergency stockpile to increase heating oil supplies this winter.

Many energy analysts credit the oil loan with building domestic heating oil inventories and easing prices.

Abraham also would not commit to giving energy companies more time to return the reserve oil they borrowed, a move that could give a small boost to any low gasoline inventories this summer. Under the terms of their original contracts, the companies must begin restocking by late summer the oil they took from the reserve to process into heating oil.

``We have every intention of continuing with the (contract) arrangements... and haven't even speculated about any consideration of modifying those at this point,'' Abraham said.

Copyright © 2001 Reuters Limited.

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-- Martin Thompson (mthom1927@aol.com), February 17, 2001