September 2012, Vol. 239 No. 9

Editor's Notebook

Editor's Notebook: The Watkins Legacy

Perhaps you read the obituary. On July 26 retired Admiral James D. Watkins died at age 85. What you should know is this: he was the best Secretary of Energy this country has ever had and was a very important person to our industry.

I became acquainted with Watkins in 1993 when I was writing “The Oil Makers, An Insider’s Perspective of the Petroleum Industry.” Watkins led the Department of Energy from 1989-92 for President George H.W. Bush and spearheaded the Energy Policy Act of 1992. It was a momentous event, just three years past the Exxon Valdez calamity. 

Despite his conservative bent, Watkins had a reputation as an independent and analytical thinker. In 1988 he led a commission on AIDS under President Reagan that was widely praised.

The energy bill faced stiff opposition from environmentalists, members of the petroleum industry and members of the Bush administration. The former chief of naval operations and a graduate of the U.S Naval Academy spoke with intensity, passion and knowledge.

“I put the number one issue as uncertainty concerning future directions of both national and state lawmakers regarding access to certain of our nation’s natural resource treasures – like the Arctic National Wildlife Refuge (ANWR) and the Outer Continental Shelf. This is very critical.”

“Realistically,” he added, “we must take a look at how to transition from the insatiable oil appetite that Americans have in the transportation sector to some alternate fuel. Technically, realistically and economically you cannot step into these other sources overnight. So we still need traditional fuel resources for a long time to come.” 

He said it was time to build pipelines to pull the natural gas from the Prudhoe Bay fields. Watkins wanted to see LNG produced and exported to Japan from Alaska; he was adamantly opposed to imports of LNG because of the hefty gas reserves he knew existed in the U.S. The 37-year Navy veteran wanted to see more offshore pipelines constructed.

Environmentalists he could deal with; but those who take it to the extreme riled him because they “are really driving current policy with no substantive justification.”

Watkins discussed the need for new technologies, some of which are responsible for the shale revolution. He foresaw a spectacular future for natural gas, suggesting it could return many jobs to America. He told the industry to stop being “too parochial and too one-energy-source oriented.”

Then he talked about the battle of ’92. “President Bush was with me and that’s the only reason I was able to get it through. People within the administration, Dick Darman (Office of Management & Budget) and Nick Brady (Treasury) who were very much opposed to any energy strategies, who thought it wasn’t necessary and felt I was getting into free market issues we shouldn’t be getting into. (White House Chief of Staff) John Sununu thought it was politically unnecessary, raising a lot of issues you didn’t have to. But President Bush wanted it because he felt it was right.”

The energy bill was the only piece of substantive legislation passed during Bush’s last year in office. I called his Houston office for a reaction to the passing of his old friend. This is what he said:

“The fact that I was blessed to have a man of Jim Watkins’ sterling qualities as a member of my Cabinet was one of the reasons why I am convinced that no president was ever better served by the men and women on his team. In all that he did throughout his full life, Jim was a leader — able, confident, a doer. Of course, you could say my background in the energy business gave me special insights to Jim’s portfolio and accomplishments as our Secretary of Energy.

“He oversaw some 90 administrative actions culminating in the Energy Policy Act of 1992 aimed at strengthening our domestic energy industry; and in my view he earned the respect and thanks not just of the industry but of the Nation itself. Barbara and I were deeply saddened at the news of his passing.  He was a great friend and a very good man.”

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