The latest talk show circuit talking point by the liberal apologists is the claim that the oil companies have millions of acres of land already leased for oil development, but the companies are not using them. The inference is that they do not need to drill offshore or in Alaska, because they are already sitting on a bonanza approved for drilling. They use the statement as evidence that the oil industry is creating the current crises on purpose.

Of course, none of that is true. There is an excellent article in the Opinion page of today’s Wall Street Journal penned by Red Cavaney (is that an oilman’s name or what?). Mr. Cavaney is president of the American Petroleum Institute, a trade association that represents the oil and gas industry, (i.e. the horse’s mouth)

In it, Mr. Cavaney outlines how oil leases operate. The bottom line is that the oil companies pay millions of dollars to state and federal agencies to lease land for the privilege to explore for oil. That’s “explore” not necessarily “find”. Lots of wells are dry, and costly. If the companies do not find oil, they move on, but it still shows up as leased on government books. And the government is making lots of coin on the transaction, whether or not oil is found. Of course, if oil is found, the government gets much more money in royalties. Then they tax the crude when it moves, tax it when it gets refined, tax it when petroleum products are sold to retailers, and tax it when it is sold to consumers. Then they accuse the oil companies of gouging. Wow, what gall. The only party guaranteed a profit in the oil business is the government. The higher the price, the more profit the government makes, whether or not the oil companies make money. Do I detect a little conflict of interest here?

If, after all this cost of exploration and taxing the oil companies are still able to make a profit, then Congress threatens to impose a "windfall tax". Who needs King George?



This is typical of the misinformation spread by liberals in their attempts to justify bankrupt policies. Next time you hear liberals make statements that supports their position, don’t just take their word for it. It’s probably not true.