Oil Refinery Construction and Environmentalists

poempainter's picture

I keep hearing the argument that we environmentalists are blocking the construction of oil refineries, which is a big reason why gas prices are so high. I found this hard to believe, so did some research. I found a lot of information, but this site puts the key facts nice and concisely. Please at least read the excerpt so we can all gage more realistically where we stand.

Thanx,

Nance

http://www.tompaine.com/articles/2006/06/06/no_new_refineries.php

excerpt from the above link:

...the National Petrochemical and Refiners Association conceded at a May 23 Senate hearing on price gouging that gasoline supplies were temporarily tight. But the oil industry lobby went on to note that:
This situation will ultimately be addressed through announced additions to U.S. refinery capacity, estimated at 1.4 to 2.0 million barrels per day. This is an 8-11percent increase in U.S. capacity, which should be in place by 2010 at the latest…. over the past 10 years, domestic refining has increased by an average of 177,000 barrels per day of production each year or the equivalent of building one new, larger than average refinery each year. This fact should assuage some concerns about the fact that no new grassroots refinery has been built in the U.S. in over 30 years.
Indeed, at a Senate hearing last year, BP's chief executive officer explained that "[refinery] margins over the last 10 to 15 years have not been high enough on average to justify building a new refinery." And in a recent closed-door briefing with congressional aides, an Exxon Mobil official said that company foresees no need to build new refineries at least through the year 2030.

If that weren't fast enough, last year's Energy Policy Act included provisions to coordinate state and federal permitting for new refineries. Energy Secretary Samuel Bodman hailed the refinery provisions as "easing the constraints on new refinery construction."

...But what about the related argument about alleged barriers and permit delays for expansions of existing refineries? First, note that all the expansions mentioned above have taken place and are expected to continue without any change in current rules. Backing up that experience, CEOs for BP, Shell and Conoco all testified to Congress last year that environmental requirements have not blocked a single planned refinery expansion. And, contrary to Joe Barton's wild assertion, then-EPA administrator Carol Browner testified to Congress in 2000 that about half the permit modifications for refineries were issued within five months and that most of the others were issued within a year. That conclusion was bolstered by a new survey by state air pollution regulators, which concluded that environmental requirements have not delayed refinery expansion plans.