The People of America's Oil and Natural Gas Indusry

Energy Security ... #Fail

Mark Green

Mark Green
Posted November 15, 2011

Twice in the past week the administration has made decisions affecting America's energy security. Twice it has come up empty - going 0-for-2 on the Keystone XL pipeline and a new federal five-year plan for offshore leasing.

Unfortunately, it's not a game. These decisions could significantly limit access to North American resources and make our energy future less secure - while also costing jobs and growth that could generate additional revenues for government.

Certainly, deferring a decision on the Keystone XL to early 2013 is important. The administration says more time is needed for consideration - in addition to three years of review, including three separate environmental studies that determined the pipeline wouldn't pose a significant environmental risk. That's 20,000 U.S. jobs deferred from the project's construction phase alone. In energy terms, it's deferring more than 800,000 barrels of oil per day from a friendly, dependable ally - Canada.

While the Keystone XL dominated the news, the administration's new offshore leasing plan has no less impact on energy security. The proposed five-year plan basically provides for leasing in areas where the oil and natural gas industry already is operating. It leaves out the Atlantic and Pacific coasts and almost all of the Eastern Gulf of Mexico. It falls short of what the administration itself discussed in early 2010.

Erik Milito, API's director for upstream and industry operations, talked about the leasing plan during a teleconference with reporters Tuesday. He called the Interior Department's claim that the plan encompasses about 75 percent of all undiscovered, technically recoverable offshore resources "inaccurate" because it's based on old and inadequate information. Milito:

"The areas left out of the plan - the Atlantic, Pacific and most of the Eastern Gulf of Mexico - may very well hold very large amounts of oil and natural gas. Basing five-year leasing plans on old data puts us in a Catch-22. It prevents the leasing in new areas needed to spur the costly exploratory work that would provide a truer picture of the resource potential. Historically, the more we look, the more we find and, as technology improves, the more we are able to recover."

Milito said administration claims that the U.S. is producing more oil and natural gas and suggestions that its policies are securing our energy future are flawed:

"While oil and natural gas production is increasing today, this is largely due to the development of shale oil and natural gas on private lands in North Dakota, Pennsylvania, Texas, Arkansas, Louisiana and elsewhere - and because of leasing and development on public lands and federal waters initiated many years ago."

The bottom line: Putting off the Keystone XL pipeline and putting out a limited offshore leasing plan both work to maintain the energy status quo, in terms of access to North American resources. These actions help hold at arm's length a pro-development approach - utilizing offshore and onshore resources - that could by 2030 provide more than 1 million new jobs, more than $800 billion in cumulative new revenue for government and more than 10 million barrels worth of oil and natural gas per day. It's a strategy that could see 100 percent of our liquid fuel needs met domestically and from Canada by 2026.

But you can't get there without the Keystone XL pipeline and a robust offshore leasing program. On the question of how to make our energy future more secure, two big whiffs for the administration. There isn't any question about how to secure our energy future. We know the steps we need to take to move forward. The real question is, why do we keep going backward?

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. Mark also was a reporter, copy editor and sports editor. 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 live in Occoquan, Va., where they enjoy their four grandchildren.