Barton: Katrina Exposes Fragility Of Energy Sector, Infrastructure

WASHINGTON - U.S. Rep. Joe Barton, R-Texas, chairman of the House Energy and Commerce Committee, issued the following statement today as part of a full committee hearing entitled, "Recovering from Katrina."

"I want to begin by expressing my deep sorrow to the families and friends who are experiencing such unimaginable loss from Hurricane Katrina.

"Many of the constituents hurt by Katrina's wrath are represented directly on this committee by Vice Chairman Pickering, and the committee for years has had the benefit of representation from Louisiana, including its former chairman, Chairman Tauzin. But this storm is not the burden of any one state. It is a burden for the entire nation and we will deal with it as a united nation. To name a few, the states of Texas, Arizona, Alabama, Tennessee, Arkansas, Georgia, Florida, Kansas, Utah and Ohio have all opened their doors to Katrina refugees and we thank them for that.

"This hearing will be the first of several hearings that the committee hopes to hold on the impact that Katrina had on energy, health and telecommunications. Unlike hurricanes of the recent past, Katrina has been both destructive and disruptive. The disruptions have had an impact on the energy, telecommunications, health and commerce sectors of the nation's economy - all areas within the purview of this committee. This is not a hearing to engage in a blame game or to pose recriminations against one another. This is a hearing to begin to understand the effect Katrina had on our committee's areas of responsibility. There will be numerous opportunities to determine where blame should be placed. I hope we spend more time learning from our mistakes, and taking positive action to correct our mistakes.

"I want to thank our witnesses for their time and preparation to appear before the committee today. Many of you are here today to discuss energy security. As we confront the human tragedy from Katrina, the consequences force us to think more expansively about energy security, and to focus harder on matters that the recently passed Energy Bill already emphasized.

"If there is a silver lining in this tragic situation, it may that our country understands how fragile our energy sector is and our energy infrastructure is, and how easy it is to disrupt it. Energy in America is based on a 1970s model that has not changed.

"The U.S. oil infrastructure is operating at maximum capacity and has done so for the past two to three years. We just signed the most comprehensive energy bill in the last 15 years and we did it on a bipartisan basis. This hurricane is a reminder of what needs to be done.

"Katrina reminds us of the need to protect and expand resources and infrastructure in the Gulf producing states to encourage continued operations. The recently passed Energy Bill included a $500 million provision directed at coastal restoration.

"Katrina also reminds us of how centralized our nation's energy infrastructure is and the need to encourage investment and diversification. For a sense of the numbers, 29 percent of our oil production and 20 percent of the natural gas is in the Gulf of Mexico. It doesn't have to be that way. We could be drilling in Alaska right now; we could be drilling off the coasts of several other states. It would make a difference today if we were not as restrictive as we've been the last 20 years in where we drill. We can't just get our oil and gas from Texas, Louisiana, Mississippi and the Gulf of Mexico. We need to diversify our domestic oil resources.

"We have not built a new refinery in the U.S.A. in more than 30 years and Katrina has shown us that our refinery capacity is inadequate. Last week Katrina forced a shutdown of approximately 25 percent of our refining capacity. Relief efforts have brought much of this capacity back on line, but my understanding from recent Department of Energy reports is that 10 percent of our gasoline refining capacity will nevertheless be out of commission for some time. To encourage new refineries the Energy Bill has a provision that allows a governor of a state to petition the Environmental Protection Agency for technical and financial assistance in the refinery permitting process.

"We need to encourage states outside of the Gulf to take advantage of Energy Bill provisions like this.

"Also today I expect to hear more about gasoline pricing. I think a good case can be made today that some retailers may have taken advantage of the Katrina emergency. If that's true, that is something that needs to be investigated and, in all probability, prosecuted. Among other issues, we're going to investigate the price increase at retail today. I believe in a market economy and there is no need for price controls and price freezes at any level, but I think there may be a need at the retail level to make sure we have adequate enforcement tools to prevent pure price gouging

"Also today we welcome witnesses that will help us begin developing an understanding of Hurricane Katrina's effect on the communications systems in the region and begin understanding the road to rebuilding critical infrastructure that has been damaged or lost.

"Again, this hearing will be the first of several hearings that the committee plans to hold on Katrina. We will have further hearings in other areas of committee jurisdiction. I thank you all for your time in appearing today and look forward to hearing what you have to say. And without objection, the committee will proceed pursuant to Committee Rule 4(e), allowing members the opportunity to defer opening statements for extra questioning time."

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