The People of America's Oil and Natural Gas Indusry

Energy and the National Interest

Mark Green

Mark Green
Posted March 14, 2014

More on the growing discussion of how North America’s energy renaissance – led by surging oil and natural gas production – affects U.S. energy and national security and gives our country the chance to positively impact global stability. A part of that conversation is the significant role the Keystone XL pipeline could play in securing our energy future, allowing our country to have greater influence abroad.

Below, check out the first 45 to 50 seconds of this video from a congressional hearing this week in which Gen. Martin Dempsey, chairman of the Joint Chiefs, talks about the security implications of increased domestic energy production:


That “instrument of national power,” as Gen. Dempsey terms it, would come from U.S. leadership in global energy markets, the ability to provide supply diversification and generally help defuse tensions brought on by energy scarcity in key parts of the world. Retired Gen. James Jones, former national security advisor to President Obama, talked about these points in a separate hearing on the Keystone XL:

“We are blessed with abundant and diverse energy resources that are unmatched anywhere else in the world. What we do with this abundance and diversity will have geo-strategic consequences that we are just now beginning to comprehend. … Energy disparities create dangerous friction between the energy haves and have-nots. Throughout history – both in war and in peace – poverty and prosperity have been inextricably connected to energy through the enormous power it confers on those who have it and the vulnerability it spells for those who don’t, as well as the tension created by the breach between them. Here again, American leadership on energy development and climate can be an effective means by which we affect world outcomes on a critically important question.”

Jones tied the discussion to the current Crimean crisis, as well as Iran’s repeated threats against the flow of energy through the straits of Hormuz, the petro-politics of Hugo Chavez, Saddam Hussein’s invasion of Kuwait and Osama bin Laden’s targeting of global energy infrastructure:

“(The) incursion in the Crimea is, among other things, about exercising political power through the control of energy, and about brandishing the threat of energy scarcity to intimidate and manipulate vulnerable populations. … Energy scarcity is a potent strategic weapon. The greater the gap between global supply and demand, the more destructive the weapons will become. … We look to energy flow in free markets as a means of promoting international peace, prosperity, and economic stability.

At last week’s IHS CERAWeek energy conference, former State Department special envoy David Goldwyn also talked about U.S. energy abundance as something to strengthen our foreign policy hand:

“The next step … is really to move to use energy as a tool in foreign policy. … Imagine if five years ago Europe had allowed a free market so you could move oil and gas clear across the continent, and if the U.S. had unfettered LNG and oil exports, what would we be doing right now? Would we be moving LNG cargoes to Poland, moving gas to the Ukraine, would we be selling condensate, would we be driving down the price of oil and impacting Russia’s balance sheet? … You can see the potential that we would have to be a direct support to our allies. … That’s a huge tool. The tight oil boom, the tight gas boom, has already lowered prices. It’s already displaced a large amount of oil and gas. So we’re getting some of that benefit.  But, putting on a foreign policy hat, there’s a lot more we could take advantage of.”

API President and CEO Jack Gerard, also during CERAWeek:

“The less reliant we are on elsewhere, regardless of what those ultimate supply and demand equations bring to the market, the better off we are as a country. … It brings us back to the (energy security) topic – where do we in the U.S. play in that? Who would have thought when the Iran sanctions were imposed most recently that effectively, (increased U.S. energy output) held the price relatively stable, primarily due to North Dakota production? … The U.S. has a major role here. … It’s no longer scarcity, it’s abundance and how do we play into that broader global equation.”

But again, these points necessarily circle us back to a focus on more domestic oil and natural gas production, because it ensures U.S. energy security, which strengthens America’s position on the global stage. The Keystone XL pipeline is an integral part of a broad strategy to deepen our energy relationship with Canada so that 100 percent of our liquid fuel needs could be met domestically and from Canada by 2024. Karen Harbert, president and CEO of the Institute for 21st Century Energy, from this week’s Keystone XL hearing:

“Reliable, long-term energy supplies from Canada are critical to U.S. energy security at a time when global supplies are often found in geopolitically unstable regions of the world and in countries that aren’t concerned with U.S. best interests. … America has a choice of getting more oil from its trusted ally Canada and in the process increasing revenue and investments in the U.S. or sending more of our hard earned money to unfriendly or unreliable countries.”

Jones said the Keystone XL is an example of critical energy infrastructure, strongly supported by the American people, that will let the U.S. capitalize on an “historic opportunity” to harness energy sufficiency to solve domestic challenges and strengthen our global leadership:

“Why would the United States spend billions of dollars and place our military personnel at risk to ensure the flow of energy half a world away, but neglect an opportunity to enable the flow of energy in our very own back yard—creating jobs, tax revenue, and greater security?”

The answer is, we shouldn’t. We shouldn’t reject a privately financed infrastructure project like the Keystone XL, which the U.S. State Department says will create more than 42,000 jobs during its construction phase, generate broad economic stimulus and bring upwards of 830,000 barrels of oil per day from Canada and the U.S.Bakken region to our Gulf Coast refineries. We shouldn’t reject a project that’s clearly in our national interest. The Keystone XL decision tests whether the U.S. will act like the energy superpower it is. Jones:

“The decision on the pipeline is a litmus test of whether America is serious about national, regional, and global energy security, and the world is watching. America’s workers and consumers are watching. Investors and job creators are watching. Our allies who need a strong United States and a reliable energy partner, are watching. The developing world, which requires global energy abundance to lift hundreds of millions of people out of poverty, is watching. And the international bullies who wish to use energy scarcity as a weapon against us all are watching intently. … If we want to gain an important measure of national energy security, jobs, tax revenue, and prosperity to advance our work on the spectrum of energy solutions that don’t rely on carbon,(Keystone XL) should be approved.”

Let’s pass the test. President Obama can move the Keystone XL forward with a stroke of his pen. The pipeline will make America stronger from an energy standpoint, stronger economically and stronger in terms of global leadership.

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.