HERRINGTON SAYS HE MAY CALL FOR OIL TAX BENEFITS
Energy Secretary John Herrington
said he may recommend to the White House that the domestic oil
industry be given tax benefits to help it produce more oil and
head off increasing U.S. dependence on foreign oil.
    He said also at a news conference that he would recommend
to the White House that the fill rate of the Strategic
Petroleum Reserve be increased from its planned 35,000 barrels
per day.
    The oil reserve fill rate capacity is 100,000 barrels a
day.
    Herrington said he had always advocated a greater fill rate
for the petroleum reserve, but the rate had been kept down
because of budgetary constraints.
    Herrington did not disclose what tax incentives he might
advocate, but U.S. officials have shown interest in tax
benefits for oil and gas exploration and for research and
development into new ways to extract oil which is now
considered uneconomical to produce.
    He made the remarks in conjunction with the release of the
Energy Department's study on oil's impact on national security.
    Herrington said that before he disclosed what
recommendations for tax benefits for the oil and gas industry
he might make, he would raise the matter with the White House
Economic Policy Committee to see if the proposals to increase
oil production made good tax policy.
    He said he would like to increase U.S. production by one
mln barrels a day.
    The report said that by the end of the century the United
States may be relying on foreign sources for 50 pct of its oil
consumption, posing a serious economic and national security
threat.
 Reuter
