State of American Energy 2021: Ready to Help Build the Future

Mark Green
Posted January 13, 2021

We’re ready, and we’re able.

After a difficult year in which too many were lost, economic hardship was palpable and creeping doubt dogged the national psyche, Americans are right to look to the future. And America’s natural gas and oil industry is ready and able to help build that future.

It takes energy – affordable, reliable energy – to move people and things, to build, heat, manufacture, innovate and grow today and tomorrow. Natural gas and oil are America’s leading energy sources, by far, and our industry is ready to provide the dependable foundation for the country’s next great chapter.

Like every other business sector, ours took some lumps in 2020, but we proved our resilience, our staying power and capacity, despite significant challenges, to power recovery and drive new opportunity on a nationwide scale.

Those are a few of the key themes from today’s API’s annual State of American Energy event. Emerging from the trials of 2020, all of us can be thankful that the state of American energy – the state of the U.S. natural gas and oil industry – is good, very good.

See our 2021 report, “Building The Future,” for details on how natural gas and oil are working today to support recovery and growth, as well as how our industry is helping take America to the future – through technology and innovation and a commitment to protect the environment in the process. We welcome the role. We always have. Amanda Eversole, API executive vice president and chief operating officer, framed today’s event:

“Through World Wars, energy crises, a pandemic and other major challenges, the natural gas and oil industry has worked day and night, so the world can swiftly recover from setbacks. And in recent days and months, American resiliency and democracy have been tested like never before. Amid all the uncertainty, you can depend on our industry and the more than 10 million jobs it supports to strengthen U.S. energy leadership, enhance national security and serve as the foundation for nearly every other industry. When America needs a sure thing, you can count on us.”

API President and CEO Mike Sommers’ keynote remarks focused on a number of important points as 2021 unfolds, including industry’s willingness to work with the new administration and Congress on sound energy policies, industry’s climate and environmental progress and the need for more infrastructure. Sommers also unveiled API Energy Excellence, an initiative that creates a roadmap for member companies to continue and accelerate operational excellence. More on that below.

In many ways, Sommers depicted an industry that’s ready to do heavy lifting as the nation regroups and moves forward:

“The millions of men and women whose jobs are supported by our sector reflect our industry’s commitment to step up, take action, and solve problems. Our resilience, values and principles are essential to America’s success and recovery, and they are evident among our workforce in communities across the United States. Because reliable energy is so central and consequential to everything else in the economy, we don’t get caught up in every political battle of the moment. We keep the focus on the essential work America depends on – producing and delivering American energy, contributing to America’s national security, answering climate challenges with action and American ingenuity and keeping energy affordable for all.” 

Sommers added:

“With all the disruptions across the economy, our industry continues to deliver without interruption. We keep the lights on. We heat homes, hospitals, businesses. We fuel cars and trucks. Never in doubt. That’s because the people of this industry step up. … In reality, every day, pandemic or not, the men and women of our industry show up and do extraordinary work – often unseen and unrecognized. That is consequential.”

More than a rallying cry, this acknowledges that big challenges lie ahead while asserting that robust domestic natural gas and oil development is critically important to meeting those challenges. It’s no time for aspirational experimenting. Natural gas and oil are ready, today, to provide the energy the modern, sophisticated U.S. economy needs to get rolling again.

Policymakers in Congress, the new administration and in the states shouldn’t take actions that add up to discarding hard-earned progress – which has seen the U.S. become the world’s leading producer of the world’s leading energy sources, natural gas and oil. Too much is at stake for this achievement to be thrown away for political reasons. (Below, natural gas and oil are projected to supply nearly half the world’s energy in 2040 by the International Energy Agency.)

Sommers noted that the 2020 election showed substantial support for American energy and that the power balance belongs to the “moderate middle” that supports U.S. energy leadership. This argues for safe and responsible natural gas and oil development for the energy Americans can count on and afford as they recover from the pandemic. Sommers:

“A government that’s focused on recovery for all should reject policies that could drive up energy costs and hurt those who can least afford them. And that’s the case we’re making and approach we’ll take in working with President Joe Biden and his administration. Our country has a lot of economic ground to make up, millions more jobs to recover.  And when the business at hand is economic revival, no industry can help more than this one. … The surest way to bring recovery to a stop is to remove affordable energy from the picture – with more regulations, more taxes, more restrictions on access.”

Here's lightning-round treatment of other critical issues from today’s event:

Climate and the environment

• Increased use of cleaner natural gas for power generation has removed more than 3 gigatons of carbon dioxide emissions that otherwise would have occurred between 2006 and 2019.
• Even before the pandemic-related economic downturn, U.S. emissions were about as low as in the 1990s, while economic growth has doubled.
• U.S. CO₂ emissions in 2019 declined to nearly 15% below 2007 levels, more than was projected to result from climate legislation Congress considered in 2010.
• Industry innovation has helped reduce production-related methane emission rates by nearly 70% in the largest producing U.S. regions. The Environmental Partnership, representing more than 70% of total onshore U.S. production, is focused on further reductions – including a new program to decrease flaring in operations.

Sommers:

“Environmental goals are easy to declare, the more far reaching the better.  But nothing is actually accomplished by announcements and agreements.  Someone still has to invest the capital and do the innovating and engineering. That’s what our industry has been doing. That’s why the United States today is the world leader in reducing greenhouse gas emissions.”

Infrastructure

• Efforts to close down pipeline projects including Michigan’s Line 5, Dakota Access, Keystone XL and the Atlantic Coast pipeline work against supplying energy to consumers in all parts of the country.
• Infrastructure is a huge job creator – from the manufacturing of materials to actual construction.

Sommers:

“When we talk about private energy investment, infrastructure should come to mind first. The economy cannot run at full speed unless we deliver energy from where it is to where it is needed. And there’s no safer means than a pipeline.”

API Energy Excellence

• API members commit to continuous improvement and operational excellence, detailed by 13 core performance elements, including safety, security and environmental protection.
• Creates a comprehensive roadmap for applying API and industry standards, implementing workforce training, participating in performance initiatives and sharing best practices.
• Members commit to annual reporting on their progress.

Sommers:

“As energy leaders, all API members now participate in the API Energy Excellence program. Under this program, our members commit to continuous improvement and operational excellence through annual reporting. In everything they do, they’ll choose a path to accelerate progress for workers, communities, and the environment.”

As a nation we’ve come through a lot, and yet, there’s still a ways to go. America’s modern, technologically advanced natural gas and oil industry is helping lead a great American comeback. Our industry has always been on the cutting edge of innovation required by society’s changing needs and it will continue to be that leader. Sommers:

“Change is in motion, but it’s a long arc, and the majority of the world’s energy needs are projected to come from natural gas and oil far into the future. Meeting this demand is going to require hundreds of billions of dollars of investment, more exploration, more production. Our industry is prepared to meet this challenge.”