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Energy Infrastructure

Oil and natural gas provide the majority of the energy American consumers’ need, and our nation’s energy infrastructure –including pipelines, railroads, highways, waterways and ports—make sure this energy is available when they need it. A robust infrastructure system that is safe, efficient and properly maintained can help lower the costs of supplying oil and natural gas and its products for consumers by reducing congestion, maximizing efficiency and improving safety.

As expansive as our nation’s energy infrastructure is, it is in need of investment to keep pace with a growing population, demand for goods and services and energy needs. Investing in our nation’s energy infrastructure will not only allow the oil and natural gas industry to keep pace with energy demand, it will also help keep energy affordable for Americans. Furthermore, investments in energy infrastructure create well-paying jobs, give U.S. manufacturers a competitive advantage through lower energy and raw material costs and provide revenue to local, state and federal governments. All of these benefits collectively mean increased national security for Americans.

To sustain our nation’s energy renaissance and our position as the world’s largest producer of oil and natural gas, the new administration and Congress should work with the private sector to enable the expansion of our nation’s energy infrastructure through consistent regulation and efficient processes.

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Economic Impacts of a Dakota Access Pipeline Shutdown

ICF analyzed the economic impacts of shutting down the Dakota Access Pipeline (DAPL) on the Bakken Shale region, including impacts to producer revenues, state tax revenues, and employment. To analyze these impacts, ICF modeled Bakken rig activity, oil and gas production, oil disposition, and prices under two regulatory scenarios: one where DAPL remains in operation and one where DAPL is offline for a total of 16 months—13 months for the environmental impact study to be completed, one month for the court to review the study, and two months for the line to be refilled with oil prior to restart of commercial operations. ICF estimated job and other economic impacts for the 16-month shutdown period. In order to capture the lagged impact of reduced drilling and completion activity during the shutdown period, ICF analyzes the impacts on production, producer revenue, and taxes for an additional year after the pipeline restarts for a total analysis period of 28 months. This analysis uses the oil price forecast from the U.S. Energy Information Administration (EIA)’s August 2020 Short-Term Energy Outlook (STEO). Exhibit 1 below compares the economic impacts of the two DAPL operation scenarios. The bullets following the table summarize the key findings of this analysis.

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Modernizing NEPA for the 21st Century

The NEPA review process remains unnecessarily complex, unreasonably time-consuming, and significantly uncertain, which in turn impedes investment in the nation’s energy resources and infrastructure. The intent of NEPA is to benefit the environment and future generations of Americans. Hundreds of projects have been delayed in the last decade by NEPA, including the Bayonne Bridge Raising project that took more than 10 years and produced over 20,000 pages of environmental reviews. Uncertainty around costs and timelines can make projects uneconomical and, without updating NEPA, many will never be built. NEPA reform is a win for every industry because NEPA reform could allow the efficient construction of critical infrastructure to support communities across the country, including lower-carbon energy options, like natural gas and renewables, as well as future clean-energy innovations.

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U.S. Oil and Gas Infrastructure Investment Through 2035

During the past five years, U.S. oil and gas infrastructure development proceeded at a rapid pace, and many have wondered whether the trend can continue. In that light, API contracted ICF to undertake a study that investigates the amount of oil and gas infrastructure development possible in the U.S. through 2035. This report summarizes results of the study.

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