Saturday, January 9, 2010

Interior Secretary Ken Salazar Will Not Interfere with the Natural Gas Industry

Jan 9, 2010 09:24 PM

| about stocks: CHK, DVN, APC, EOG, APA, OXY, MRO, XTO, XOM

Senior energy industry executive Karl W. Miller announced today through his advisors, that he does not see any major risk that Interior Secretary Ken Salazar Will interfere with the Natural Gas Industry.

Mr. Miller advises that Mr. Salazar simply does not have the mandate nor does he have the support of the Democrats or Republicans on this issue. Public statements to media made by Mr. Salazar that he would move to curtail the natural gas industry exploration efforts on Federal Lands were wreckless and irresponsible.

The Bureau of Land Management (BLM) has a well defined process for energy companies of all forms, wind, solar, natural gas, and oil to conduct environmental impact reports (EIR) on their current and proposed activities on Federal land. The BLM is open for business and will continue to process lease applications for all energy companies.

Mr. Miller notes that he and other industry executives effectively killed a proposed Cap and Trade proposal in Washington and have made clear to the current administration that renewable energy plan they are attempting to enact is massively flawed and destined to cost taxpayers billions, with no realized results the electricity generation mix in the United States. The Energy information Agency recently reported that by 2035, fossil fuels will comprise approximately 78-80 percent of the total U.S. Electricity generation mix.

Natural Gas will be the marginal fuel which will make a difference for the U.S. and be assured that Mr. Salazar has been told not to make any additional wreckless statements regarding natural gas exploration, nor will he be allowed to interfere with natural gas exploration.

Mr. Miller has previously advised that he does not see any major risk of Oil or Natural Gas prices materially receding by end of 2010, despite any errant forecast correction in the broader markets or if other wreckless statements by Mr. Salazar or others in the current administration were to emerge. The implied energy policy is clear, use clean fuels wherever possible going forward and Natural Gas is the primary clean fuel.

Additionally, the Energy industry is consolidating and 2010 will be a year that major industry market participants position their portfolios for the next 20-30 years, thus making prices somewhat immune to broader market issues.

Due to the consolidation and reserve plays currently underway, Mr. Miller believes that the Energy markets will set sustainable new price floors to the upside, and prices will only rise further during 2010 for a variety of fundamental, weather, and industry consolidation related reasons

Disclosure: long energy companies

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