Energy Tomorrow Blog
Posted December 9, 2020
Let’s discuss the value of natural gas and oil to all Americans – the fundamental worth of abundant, affordable and reliable energy to modern, daily life, the economy and our nation’s security – which gets lost in two U.S. senators’ proposal to make producing energy on federal lands more costly.
U.S. Sens. Chuck Grassley of Iowa and Tom Udall of New Mexico want to increase the royalty rate for production on federal lands, which would discourage that critical production. We’ll get to that point down below. First, let’s zero in on the issue of fundamental value.
In a New York Times op-ed, Grassley and Udall call the American public “the big loser” under the current royalty arrangement. In doing so, the senators are so preoccupied with percentages they inadvertently make an afterthought of what current natural gas and oil production on federal lands means for U.S. economic growth, global leadership, strengthened security at home and significant environmental progress.
Posted November 17, 2020
If President-elect Joe Biden follows makes good on his campaign promise to ban new natural gas and oil leasing on federal lands and waters, a recent OnLocation analysis sees the U.S. weakened on the world stage – forced to import more foreign oil – with crippling jobs and economic impacts as well.
In Wyoming, another producing state, the impacts would be especially devastating. The federal government controls nearly half of the acreage in Wyoming, and the state’s energy economy has been rocked by pandemic-related forces, losing about 20% of its energy-related jobs through the second quarter, according to this NBC News report. Banning new federal leasing and development would have dire effects, OnLocation’s analysis projected.
Posted November 13, 2020
Some initial thoughts on energy policy as we look ahead to a new administration and Congress.
First, as API President and CEO Mike Sommers said over the weekend, natural gas and oil will continue to play an important role in the United States’ continued economic recovery – recognizing that, as the leading energy sources for the U.S. economy, the two are essential for growth. ...
Our country needs Washington focused on economic recovery and forward-thinking about energy and climate change, factoring in how much energy will be needed when the U.S. and global economies ramp up (see API Chief Economist Dean Foreman’s post, here), while building on reductions in emissions to date and fostering innovation that will enable a safe, secure and cleaner future. To that point, our industry supports continued development and wider deployment of carbon capture, utilization and storage as a tool to further reduce emissions, which the president-elect also supports.
Posted October 26, 2020
Vice President Joe Biden’s statements on fracking and energy during the final presidential debate raise questions about the former vice president’s overall understanding of issues that are so critical to the U.S. economy, security and the environment.
We’ve previously noted Biden’s various comments on fracking – he has said he would ban the technology that made the U.S. the world No. 1 in natural gas and oil production (see here and here), before vowing he wouldn’t ban it. He repeated the no-ban pledge in Nashville (after asserting he never said he opposed fracking).More problematic is another promise Biden repeated during the final presidential debate – that he’ll ban new federal natural gas and oil leasing, effectively halting new production on federal lands and waters.
Posted October 16, 2020
We’ve discussed the significant national impacts of policies touted by some (see here and here) that would effectively stop new natural gas and oil leasing and development on federal lands and waters, potentially weakening U.S. security, killing jobs, raising household energy costs and more.
The national numbers could be big and alarming. Still, most Americans probably can relate more easily to potential impacts where they live, work and raise their families. This post zeroes in on New Mexico. Another state where the potential is large for job losses, reduced economic activity and decreased revenues – for education and other state and local priorities – is Louisiana.
A new ICF analysis shows much is at stake in banning new federal leasing and development for Louisiana, which ranked third in the nation in 2019 natural gas production and ninth in oil production as of June 2020, according to the U.S. Energy Information Administration (EIA).
Posted October 8, 2020
The stakes in bad energy policy proposals – to ban new natural gas and oil leasing on federal lands and waters and/or fracking – are underscored in a new U.S. Department of Energy report that details the economic and security benefits of robust domestic energy development. ...
Much of the DOE report reinforces what we’ve been saying, that misguided proposals to effectively end new natural gas and oil production in areas under federal control – including in the Gulf of Mexico – and/or to ban fracking, responsible for about 95% of new wells in the U.S. today, put the benefits outlined in the DOE report at risk. Weakened security, lost jobs, reduced economic output.
Posted September 16, 2020
As former Vice President Joe Biden continues to clarify his position on fracking – saying he’d allow it with some environmental safeguards – what he’s not talking about is huge: His and the Democratic Party’s pledge to effectively end new natural gas and oil production on federal lands and waters.
Few states are projected to be hit harder than New Mexico, where more than 30% of the land is controlled by the federal government and accounts for half of the state’s oil production. As of May, New Mexico was producing 885,000 barrels per day, ranking it second in the nation. So, yes, Biden’s promised ban is making folks in New Mexico a little nervous.
Posted January 15, 2016
Federal officials followed President Obama’s State of the Union pledge to change Washington’s management of fossil fuel resources by announcing the government will stop issuing new coal leases on federal lands. The president’s keep-it-in-the-ground energy strategy, first voiced when he rejected the Keystone XL pipeline last fall, continues unfolding.
Unfortunately, the president doesn’t seem aware that his administration could blow a generational opportunity for America, one that’s being provided by the ongoing revolution in domestic oil and natural gas production. That he doesn’t see it helps explain the disconnect in his connecting of these thoughts during the State of the Union:
“… we’ve cut our imports of foreign oil by nearly 60 percent, and cut carbon pollution more than any other country on Earth. Gas under two bucks a gallon ain’t bad, either. Now we’ve got to accelerate the transition away from old, dirtier energy sources.”
Respectfully, Mr. President, falling oil imports, reduced U.S. carbon emissions and $2 gasoline are reasons to sustain and grow America’s energy revolution – not reasons to kneecap it.
Posted September 25, 2015
The Washington Post reports that a coalition of environmental activists wants the Obama administration to stop new federal leasing for oil and natural gas development. Notwithstanding the broad energy, economic and security benefits produced by America’s energy revolution, the opportunity to secure America’s future and significant air quality progress, their position is simple: Keep it in the ground.
The position also is extreme, anti-progress and anti-modern – though hardly surprising. There’s a small but loud element that has little interest in safe and responsible energy development or in constant improvement of operational and environmental safety. Rather, it opposes development altogether. Their recent push is the latest sign of an agenda that would put America in retreat economically and in the world.
What’s surprising is that these activists actually concede that Americans want oil and natural gas. They acknowledge consumer demand for oil and gas – affordable, reliable and portable fuels that make life less harsh, healthier and more prosperous – but they want government to choke off that demand by cutting supply.
Posted May 21, 2015
Consumers have felt some of the fruits of America’s energy revolution, API Chief Economist John Felmy told reporters in a pre-Memorial Day conference call.
Felmy noted that drivers are paying about $1 less per gallon of gasoline on average nationwide than they did at this time a year ago, according to AAA. He said that thanks to advanced hydraulic fracturing and horizontal drilling, the U.S. energy resurgence has offset production declines in other parts of the world, which has resulted in a more stable global market for crude oil – and relief at the gas pump. He added that the U.S. energy picture currently is characterized by strong domestic supply, moderate demand, increasingly efficient production and a refining sector that’s turning out record amounts of gasoline.
Felmy said the right energy choices by our country’s leaders can help continue the energy revolution.