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Show "2 ^ fur >*r obstacles which arc before us," the statement says. "The decrease m drilling reflects a flight of capital from the oil hunting business, Obviously, we have a shortage of reserves because the price is too low. Roadblocks. Obstacles the association believes must be removed include: • Excessive taxation. "The Tax Reform Act of 1969 is draining an additional quarter billion dollars a year from Texas petroleum operations. These funds can be replaced by restoration of percentage depletion rates and other incentive provisions of the tax law and through substantial price increases that will provide additional funds to producers. -Direct state taxes on oil and gab operations in Texas are costing the industry more than $233 million a yean The rates of taxation certainly should not be increased. • Uncertain import policies. U.S. policies affecting importation of foreign oil should be directed toward enhancement of domestic reserves of oil and gas. / M \z°? . Federal price ceilings on natural eas. "Congress should begin immediately to abolish federal price-fixing mechanisms which substitute arbitrary judgment for the forces of the market place in the determination of natural gas prices at the wellhead and in the allocation of gas for various consumer uses. „u/v,iiP . Uncertain leasing policies, while the federal and state governments should insist on use of the best tech-nolopy in existence to protect the environment, Congress and the administration as well as the state government should seek policies which encourage the development of oil and gas resources on public lands rather than policies which deny their use of the American consumer. • Environmental policies. Botn state and federal authorities engaged in environmental protection should adopt reasonable laws and policies and practical regulations to prevent the costly confusion resulting from radically changed goals, policies and enforcement jurisdictions." X Indonesia awards big block W E N D E L L Phillips Oil Co. of Honolulu has been awarded a 2.2 million-acre permit in the Waipoga basin area on and offshore West Irian, in Indonesia. The new block, given under Indonesia's service-contract procedure, ad-inins the southwest corner of a larger 7 9 million-acre permit awarded Phillips last February. That block, also on and offshore, covers the waters of Waropen Bay, half of Japen Island, and a sizable hunk of West loans northern coastline. It is designated "Contract Area D." The new award, known as Contract rea "D" Extension, is about one-third offshore in the waters of Geel-vink Bay, and two-thirds onshore Terms of the new agreement folio* the lines of previous Indonesian service contracts, calling for a 30-year term, with production to be shared 35<> by Phillips and 6 5 % by statesoil companv Pertamina. Production bonuses are $1 million when outpu reaches 50.000 b/d, and $2 million at v 75,000 b/d. ^^^ Socal keeps quiet about 'discovery' off Nicaragua S T A N D A R D of California is drilling its third well in Offshore Nicaragua but keeping a tight lip on what, if anything, it has found. Widelv circulated reports that Socal has a discovery-the first for Offshore Central America-are greeted by no comment" from company headquarters in San Francisco. Cocal confirms it is drilling its third well on the 965,000-acre offshore tract held bv the company. Drilling by a Rowan International jack-up ng last week was at 3,000 ft and headed for 8,000 ft total depth. The Rowan rig spudded the first well, the 1 Prinza Polka, in mid-July at a location 30 miles offshore and 45 miles south-southeast of Puerto Ca-bezas. It was plugged and abandoned at 3,785 ft in August. Then it moved 60 miles north of the first well and 5 miles offshore to drill the lToro Cay It was plugged in mid-September at 7 520 ft. The rig next spudded the current well, the 1 Escondido, 15 miles west of the first well and 18 miles off the coast. . Socal obtained the Rowan rig last summer from Shell Oil, which also is reported to have made a discovery off Nicaragua and will turn it over to Mobil Oil when the current well is finished. , ... When Mobii completes its own drilling program in the area, Socal and Mobil Plan to drill a joint-venture hole. Details of the joint venture are not available. Socal operates in Nicaragua under the name Compania Petrolera Chevron- Nicaragua CA. In addition to its offshore block, Socal has drill ng rights on three large onshore blocks totaling more than 4 million acres. • / r.rrnRFH iQ 1970 |