Energy: Oil for the Lamps of Reagan

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Halbouty's task force wrote a report on energy that was sent to Reagan the day after the election. It charged that the Carter energy program was designed to impede production and curtail consumption. Said the report: "Instead of unleashing the resources of a wealthy nation, we have, in the name of saving energy for some unspecified future time, tucked energy away like a rare bottle of wine." The Halbouty study contended that the U.S. can produce as much oil and gas in the future as it has in its entire history. The report claimed that there is more oil in one area of potential shale production than has been discovered in all the Middle East. The group, though, failed to say where that bonanza is located. They also pointed out that the U.S. has 60 times more coal than oil, 40 times more coal than natural gas, and is still the world leader in most energy technologies.

Reagan has not yet decided on many key details of his energy program, including how to restructure the Department of Energy and whether to cut back the $20 billion synfuel development program. When he does, he will find a fairly cooperative Congress eager to study his proposals. The Republican-dominated Senate is likely to revise some pollution regulations and to open up more public lands to coal mining and oil exploration. Republicans also have an ideological majority in the House, where 40 Southern Democrats often vote with them on energy issues. Nonetheless, a few of the more controversial aspects of the report, like the speedier licensing of nuclear plants and the rapid construction of nuclear waste dumping facilities, may face strong opposition.

The oil industry, which has some of the most skilled lobbyists in Washington, is not expecting quick legislative changes during a Reagan Administration. But it is looking forward to better relations with the federal energy bureaucracy. Says one oilman: "We will at least be moving away from the days when the participants in Earth Day became assistant secretaries at the Department of the Interior."

Even with a shift in atmosphere, President Reagan is likely to find himself in the same narrow valley of limited options that Carter experienced. Already before the election, the Californian was forced to back off from some of his more controversial energy stands. He stopped insisting that the nation could solve its fuel problems in five years, and he began to talk about disciplining, rather than disbanding the Department of Energy. His criticism of the $227 billion windfall profits tax on oil companies became tempered after aides realized that he would need those tax revenues if he wanted to cut personal income taxes, accelerate business depreciation and increase defense spending. The political and economic trade-offs of presidential policymaking are about to become an important factor in energy policy.

—By Julie Connelly. Reported by Jeanne Sadler/Washington and Jacqueline Schmeal/Houston