What the oil companies really do with those leases.

I have very mixed feelings about Newt Gingrich, but his Townhall article on what oil companies have to do to explore and develop their leases is superb. You can find it at townhall.com (I cannot get the link to work for some reason).

As he points out, oil companies cannot hoard their leases, because those leases expire after a specified period (usually 10 years), unless the oil company begins commercial production on them. In fact, this "use it or lose it" requirement is common in the industry, where leases are "held by production."

Moreover, the federal government does not give these leases to the oil companies as Harry Reid claims. The oil companies buy them, often paying tens or even hundreds of millions of dollars for a single lease. If they do not, or cannot, commercially produce their leased acreage, that money is a dead loss.

Gingrich also shows that a lot of "idle" acreage is anything but. Oil companies may be exploring, testing, even drilling leased acreage, but until they actually begin commercial production, that acreage is classified as idle. Of course, if a company decides that a lease is not commercially viable, the lease simply reverts to the government.

Once you know the facts, the statistics bandied about by those who oppose opening additional acreage to drilling are neither surprising nor sinister. Nor do they support the argument against allowing additional drilling.

"I'm trying to save the planet. I'm trying to save the planet."

Well, that's a relief. But frankly, I'd feel a lot better if Nancy Pelosi would allow a vote on the "trivial" issue of permitting drilling on the outer continental land shelf and other federal lands. The current high oil and gas prices, in the main, are the result of the current supply/demand imbalance. And traders in the futures market have been bidding those prices higher, because they expect that imbalance to get even worse in the future (although oil prices came down after Bush rescinded the presidential order forbidding oil exploration on the outer continental land shelf).

The point is that we can do little or nothing to affect the burgeoning demand for oil and gas in other parts of the world. Developing countries aren't going to stop growing on our account. We can, however, improve the supply side of the equation.

As for saving the planet, again, the biggest increases in the production of CO2 and other "greenhouse gases" are occurring in those same developing countries (no surprise there). If oil prices get high enough, the resulting world economic slowdown might cause world demand to slacken. But that "solution" would be both painful and temporary.

By all means, let us strive to increase efficiency and develop alternative energy sources. But we also need to increase domestic oil and gas production. Saving the planet is a longer-term project.