Mike Conaway: “Gone. And much of the $2 million we spent completing the well will also be gone and there is no way to recover that. So…”

“Gone. And much of the $2 million we spent completing the well will also be gone and there is no way to recover that. So the folks in this business are big time risk takers. Now, let me show you how big time they are. In the 5 years in between 1999 and 2005, I guess that will be 6 years, the smallest U.S. E&P companies reinvested 898 percent of their profits back in the ground. Now what that means is they took their profits, as well as borrowed a lot of money against the reserves that they found in the ground to reinvest in the oil business. All the way up to the super E&P companies, those are the large publicly traded companies that are in the exploration and production business. They have reinvested 247 percent of their profits back in the ground to find additional oil and natural gas reserves. The integrated, U.S. integrated oil companies, the very largest in our country, ExxonMobil, Chevron, Phillips, all these guys, 174 percent of their profits back in the ground. So, as we take dollars, whether in this tax increase that we are going to, however they come out of it, those are dollars that will not go back into the ground to find additional supply of domestic oil and natural gas. And each time we do that, it reduces the investment, it reduces all of the activities that are associated with that. And the bottom line is that we have a shortage of supply of crude oil and natural gas. And the law of supply and demand generally works in most businesses.…”