NCGA
Supports Dialogue on Natural Gas, Energy Legislation (12-9-04)
As the U.S. agriculture sector continues to contend with high natural
gas prices and tightening supplies, the National Corn Growers
Association (NCGA) Wednesday commended members of the Senate
Energy and Natural Resources Committee for encouraging open dialogue
on natural gas and energy legislation.
In a Dec. 7 letter to Secretary of the Interior Gale Norton, Sens.
Pete Domenici (R-N.M.), Lamar Alexander (R-Tenn.) and Mary Landrieau
(D-La.) proposed soliciting comments from concerned stakeholders
on the possibility of natural gas leasing in both moratoria and
non-moratoria areas in the Outer Continental Shelf (OCS) oil and
gas leasing program for 2007-2012.
“NCGA applauds Senators Domenici, Alexander and Landrieau
(D-La.) and for recognizing that all options for increasing the
domestic natural gas supply must be considered,” said NCGA
President Leon Corzine.
In the letter,
the three senators note that with increasingly high prices of
oil and natural gas the United States is facing serious
supply problems and they requested the Department of Interior
(DOI) solicit comments on the possibility of issuing leases for
natural
gas only in the moratoria areas on the OCS.
"While we recognize that many areas of the OCS are under administrative
withdrawal and/or congressional moratoria, we are writing to request that the
Department of Interior solicit comments from all interested parties on the appropriateness
of leasing in both moratoria and non-moratoria areas on the OCS,” the
letter states.
The letter
adds that with a looming natural gas crisis, the supply of natural
gas has not kept up with increasing demand, and the United States has
pursued a policy that is in conflict with itself. “On the one hand we encourage
the use of natural gas in this country to meet our energy needs and environmental
goals….however; we have ignored the supply side of the equation. Some
combination of increased production, conservation and imports will be required
to fill in this gap,” the letter states.
NCGA believes
the United States should increase its natural gas supply by exploring
oil and gas production, remove regulatory barriers to expedite
the siting of
Liquid Natural Gas (LNG) facilities, and have a diverse fuel portfolio
that
includes clean coal technologies, noted Corzine. “The high prices of
natural gas have not only affected U.S. industries, but are having devastating
effects on the nation’s agriculture producers.”
Fertilizers
account for more than 40 percent of the total energy input per
acre of corn harvested. Retail prices for fertilizer rise sharply
when natural
gas prices increase.
“As producers we are very worried,” Corzine said. “Increased
natural gas prices have already had an adverse effect on farmers due to higher
production costs and will continue to do so in the future.”
“
Nitrogen fertilizer is a key input for the bountiful yields achieved by U.S.
corn farmers,” Corzine said. “Growers rely on affordable natural
gas as feedstock for fertilizer, but also as energy for irrigation, powering
farm equipment, drying grain and producing ethanol. Whether used directly as
a feedstock or for heat and power generation, reasonably priced natural gas
is essential to grower profitability.”
The letter
also notes natural gas is an essential raw material and feedstock,
and its rising costs contribute to the increasing
loss
of manufacturing
jobs to overseas.
Corzine concluded, “There
are many important benefits from demand-side management, but
policies that increase supply are critical
to solving our nation's natural gas shortage.”
NCGA plans to file comments on the development of the new five-year
OCS oil and gas leasing program for 2007-2012. A formal request
for comments from the DOI is expected to be issued later this month.
To read the
letter in its entirety, click here.