America’s Energy ‘Inflection Point’
Posted June 29, 2021
During a speech to the Houston Economics Club last week, API President and CEO Mike Sommers talked about the United States reaching an “inflection point” in terms of its energy and economic future. Choices made today could have impact far into the future.
As the world’s leading producer of the world’s leading energy – natural gas and oil – the U.S. can choose the market-based approach that over the past decade led to abundant domestic energy, supporting economic growth, reducing reliance on foreign oil and building greater security.
The other choice is the apparent approach of the Biden administration to curtail domestic production of natural gas and oil, swapping their reliability and affordability for aspirational fuels that could take the U.S. back to a period of energy uncertainty.
Addressing an audience in one of the nation’s biggest energy producing states, Sommers talked about two starkly different narratives:
“We face societal, political and economic headwinds post-pandemic. In some circles, you’ll hear talk of halting American energy and the jobs and local economic benefits it brings to producing and non-producing regions alike. Do we follow the Texas story, and reach new heights in U.S. innovation and energy leadership? Or does Washington chart the course? That could be a different story.”
Sommers said the natural gas and oil industry recognizes the risks of climate change and is uniquely positioned to develop solutions while simultaneously producing the natural gas and oil that power our economy and make possible our modern standard of living:
“Climate change is a threat affecting economies worldwide. It’s not an issue that can or should be brushed aside. Yet, the key to environmental progress in the world isn’t the Green New Deal. It’s not the Sunrise Movement. It’s coming from competitive markets and innovation – including from this industry. Cleaner fuels like natural gas are essential, and they’re why the U.S. leads the world in emissions reductions. This industry is essential to supplying energy that makes life modern, healthier and better – while doing so in ways that tackle the climate challenge.”
Sommers said new technologies and innovations developed by our industry have resulted in cleaner operations and cleaner fuels. He noted API’s new Climate Action Framework provides a detailed action plan for meeting the climate challenge while also supplying the world with energy. Industry has a track record of problem-solving and isn’t waiting around for government mandates:
“[T]hink about 2010, the last time Congress considered climate legislation. Back then, lawmakers estimated that CO2 would drop by as much as 10% below 2007 levels in 2019 if their bill became law. Well, their bill didn’t. Instead, industry innovations like hydraulic fracturing and horizontal drilling increased domestic supply and use of natural gas, and U.S. CO2 emissions declined nearly 15% – 50% more than what Congress predicted.”
Contrast that with Washington policies – halting new federal leasing onshore and offshore, increasing regulation, raising industry taxes and neglecting infrastructure needs – that could sound the retreat from hard-earned energy and security gains generated by the shale revolution. “Nothing less than our economy and national security are at stake if Washington handcuffs this industry like that,” Sommers said.
The fact is the administration’s approach is an import-more-oil approach, tightening the spigot on domestic natural gas and oil and leaving others to meet energy demand. Again, it’s an approach that could trade growth, security and environmental progress for increased reliance and uncertainty.
You don’t have to imagine this future. It’s happening in California.
The state experienced rolling blackouts last summer and may face them again this summer, writes Robert Bryce – reflecting extreme decarbonization mandates and decisions to limit natural gas-fueled power generation and nuclear power. California plans to ban new sales of gasoline-powered vehicles by 2035, which will increase electricity demand in a state that has struggled to keep the lights on.
America can be better that this. As Sommers noted, we’ve seen it in Texas, where employment is higher than the national average, with the energy sector adding jobs every month since September, where home prices are increasing and the return to normal living has been underway for some time. Texas’ story is on natural gas and oil and an adaptive, innovative industry that is delivering energy while taking actions to reduce emissions. Sommers:
“[T]here is no single solution to bring energy to the people in a more sustainable way. Instead, there are multiple paths to support communities, meet energy demand, and tackle climate change. They all share a common route: natural gas and oil. To build a better world for all, it’s imperative to enable energy development and environmental progress. This industry, thanks to so many Houston-based operators, knows how to get us there. That’s energy reality.”
About The Author
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Previously, Mark was a reporter, copy editor and sports editor at an assortment of newspapers. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela have two grown children and six grandchildren.