Increasing the U.S. Gas Tax 20% to Increase Natural Gas Supplies Will Boost Economic Development and Will Promote Environmental Protection,

Proposal

Increasing the U.S. gas tax 20% to increase natural gas supplies will boost economic development and will promote environmental protection, while ensuring more stable prices for natural gas customers. Most importantly, increasing natural gas supplies will give Americans what they want reasonable prices, greater price stability, and fuel for our vibrant economy. However, without policy changes to natural gas supply, as well as expansion of production, pipeline, and local delivery infrastructure for natural gas, the natural gas industry will have difficulty meeting the anticipated 50 percent increase in market demand. Price increases, price volatility, and a brake on the economy will be inevitable.

I. If gas prices don’t increase by at least 20%, our natural gas supply won’t be efficient enough to meet the American population’s needs.

A.) Americans will be using twice as much natural gas in the future.

According to the Energy Information Administration, by 2005 we may need 20% more natural gas than we use today; by 2015, 50% more. But U.S. production has flat-lined for fifteen years, and Canada is treading water, too. Natural gas is the environmentally friendly fuel of choice and during the summer, gas is pumped into underground caverns for use the next winter. This schedule is now being crimped by Sunbelt air conditioners, whose demand for gas-fired electricity is soaring. Gas is used to keep us warm; now we ask it to keep us cool, too. So where is the new gas going to come from?

B.) It will cost to have more Natural Gas fields available for exploration and development.

David N. Parker, president & Chief Executive Officer of the American Gas Association in Washington, D.C. U.S. House of Representatives Resources Committee states: Many of the fields from which natural gas is currently produced are mature. Over the last two decades, technological advances have greatly enhanced the ability to find natural gas as well as to produce the maximum amount possible from a field. However, if America’s needs for energy are to be met, there is no choice except for exploration and production activity to migrate into new areas. The nation’s natural gas resource base is rich and diverse. It is simply a matter of taking exploration and production (E&P) activity to the many known areas where natural gas is found or thought to exist. Regrettably, many of these areas are either totally closed to exploration and development or are subject to so many restrictions that timely and economic development is not possible. The E&P business is, as a result of technological improvements, enormously more environmentally sensitive today than it was 25 years ago. As a result, current restrictions on land access need to be reevaluated given the nation’s energy needs and this will become new government expenditure.

II. The United States Government should change the present system in order to eliminate the current and future structural problem.

A.) Certain mandates must be eliminated to allow exploration in areas where natural gas is present.

David N. Parker, president & Chief Executive Officer of the American Gas Association in Washington, D.C. U.S. House of Representatives Resources Committee states: The most important step Congress can take to address these issues is to ensure that lands where natural gas is believed to exist are available for environmentally sound exploration and development. Additionally, it is appropriate to create incentives to seek and produce this natural gas.

B.) The government must create a plan to get citizens involved in energy conservation.