Statement of U.S. Senator Russ Feingold On the Oil and Gas Industry Antitrust Act of 2006 April 27, 2006 Chairman Specter, Ranking Member Leahy, I want to begin by thanking you both for putting S. 2557, the Oil and Gas Industry Antitrust Act of 2006, on today's agenda. I am a cosponsor of this bipartisan legislation, and I hope that today we will move the bill one step closer to enactment. On February 1st of this year, Mr. Chairman, you held the first of two hearings looking into consolidation in the oil and gas industry. The very day you held that hearing, there were reports of refineries reducing output in response to declining profits. I found these reports disturbing, and I asked a follow-up question on this topic after the March hearing. While I did get a response to my question from one of the companies, the other, Valero Corporation, has yet to respond. This is troubling, quite frankly, because on Tuesday, in disclosing its first quarter earnings, Valero indicated that the acquisition of Premcor Inc. last September was one of the reasons behind its surging profits. It was that very acquisition last year that spurred me to lead a letter to the FTC, which was signed by some of my colleagues on this Committee, including Senators Feinstein, Schumer, and Durbin, asking about consolidation in the oil and gas refining sector. To quote from the letter, "The merger between Valero Energy and Premcor further consolidates the ownership of refineries (giving Valero nearly 13 percent of the national market share), thereby worsening the consumer's already weakened position." I ask unanimous consent that a copy of that letter be placed in the record. I would also like to ask for your help, Mr. Chairman, to ensure that we get answers from Valero to my written question and those submitted by other Senators. While S. 2557 is a sorely needed step toward addressing problems in the oil and gas industry, I also believe that we must come to grips with what the President has rightly termed our addiction to oil. That addiction poses a significant threat to our economy, our national security, and our environment and it is long past time to develop an energy policy that brings this country into the 21st century and actually looks to the future, like we should have done in the late 1970s. We should not waste more time on the energy debates of the past, like opening up the Arctic National Wildlife Refuge for drilling. We need policies that recognize that our country has less than three percent of the world's proven oil reserves. Our citizens are way ahead of us on this -- they know that we must move forward with a variety of alternative fuels. And my constituents have given me every indication that they aren't waiting around while the federal government keeps talking about strategies that belong in the history books. Our constituents are ready for a transition to the future -- a transition that needs to be made for the good of our economy, for the protection of our national security, and for the health of our environment. In my home state of Wisconsin, there is significant investment in many exciting alternative fuels. I recently visited the state's newest biodiesel plant and, I can tell you, I was very impressed with what I saw. Part of the solution to our country's energy needs lies in plants like that. Mr. Chairman, it is time for real solutions to our energy challenges. As my constituents have pointed out, we could have made serious commitments to alternative fuels in the past and simply didn't. This go-round, we can't afford anything short of bold action. In the short term, we must make corrections to our current system and I appreciate your work, and the work of all of the Senators involved, in crafting S. 2557. Simply stated, the provisions in your legislation are needed and overdue, and I urge my colleagues to support the bill and move it to the floor for quick action. Thank you Mr. Chairman.

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