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March 2004

Paper Industry Requests Natural Gas Easements from Congress

Washington— The most important thing Congress can do to reverse recent manufacturing job losses is to address policies that have reduced natural gas supplies, a paper industry executive testified. 

“Congress should enact a new energy policy that promotes the environmentally responsible development of domestic oil and gas reserves and it should revise environmental laws to eliminate the unnecessary bias toward natural gas,” James Rubright, chairman and CEO of Rock-Tenn Company, told the House Resources Subcommittee on Energy and Mineral Resources.

Rock-Tenn, based in Norcross, Georgia, produces 100 percent recycled paperboard for packaging, and is a member of the American Forest & Paper Association (AF&PA), for which Rubright testified.

U.S. environmental policies of the last 10 years “have encouraged increased consumption of natural gas while reducing access to natural gas reserves on public lands,” Rubright told the subcommittee.  “This combination of increased demand and reduced supply has driven (gas) prices substantially higher.”

He said the price of natural gas in 2003 was nearly double the average price for 2002, forcing the industry to spend almost $1 billion more for the same quantity of fuel. 

The impact of high natural gas prices are a “substantial contributing factor” to industry job losses, he said, noting that “in the forest products industry alone, we have lost more than 120,000 high-paying manufacturing jobs and closed more than 220 plants since 1997.”

Rubright suggested that policies to promote additional natural gas supplies should include easing restrictions on reserves in the Rocky Mountains and the Arctic National Wildlife Refuge and offshore resources in the Atlantic and Pacific Oceans, and in the Eastern Gulf of Mexico Outer Continental Shelf.

In addition, he called for more federal research to develop long-term sources of energy and energy-related technologies, such as clean coal, coal gasification and biomass/black liquor gasification.

Regarding environmental regulations, Rubright urged Congress to reexamine policies “that promote the exclusive use of natural gas for power generation at the expense of other fuel sources that can be used in an environmentally sound manner.” 

“As the economy begins to rebound,” Rubright said, “it is critically important that Congress act quickly to ensure that government policies promote rather than restrict the responsible development of our nation’s abundant supply of natural gas both onshore and offshore.”

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