Friday, July 21, 2006

 

Let's Try Building More Refineries

Gas prices have risen to the point that even Bill Gates may have need to cut back on his travel. Why have the prices risen to such an outrageous amount? Greedy oil executives? Unstable footing in the Middle East? A lunatic in Venezuela?

All of the above and more.

According to the research of H. Sterling Burnett, America has done very little if any drilling off of our own coasts. The primary drilling has been in the Gulf of Mexico, away from the Florida shores. He points out that the U.S. is the only industrialized country with a substantial coastline that does not utilize the oil deposits along those coasts. He even shows that Canada and Cuba drill off of their coasts in areas that abut our own coasts. Effectively, they are taking oil from us.

http://eteam.ncpa.org/commentaries/energy-security-on-the-shelf

Burnett's article is thorough , but he leaves out an important fact. There have been exactly zero (0) new major refineries built in the United States since the early 1980s. Why? The simple reason is to blame the environmentalist wackos for stopping the expansion of the refining industry in America. But there is more to it than that.

Many politicians cater to the environmental left. Some because the believe that the support such actions will bring will help in getting re-elected. Others, because they are true believers in the left's mantra of global warming, man's destruction, etc. Still others are environmental conservationists, not to be confused with the environmentalist wackos. The conservationists, in order to get legislation passed, will form voting blocks on environmental laws with the wacko bunch.

The outcome of these measures is that, while the refining capacity of the refineries built up to 1982 were sufficient for many years, they have not been able to keep up with the population growth seen in the last 24 years.

With the technology available today, there is no reason not to build a refinery in every state. 50 new refineries in America would lessen the bite in Americans pocketbooks. Once completed, the capacity would probably be enough for the U.S. to become exporters of gasoline products as well as providers of lower cost domestic gasoline.

There is one last caveat to the mix. The taxes on gasoline - from exploration to the pump - are such that if the top level tax were removed the price of gas would drop nearly in half.

We must start building more refineries. Until they are completed, the government should look at relieving tax payers by drastically cutting the fuel tax, at least until the crisis is over.

It's sad when the populace believes that the biggest profit on gasoline goes to the oil company, when the truth is that the federal and state government make more off of a gallon of gas.

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