Posted June 5, 2015
OK, so EPA says safe hydraulic fracturing isn’t a threat to the nation’s drinking water. That’s great news for America’s energy revolution, which is being driven by advanced fracking and horizontal drilling. Without them there’s no revolution and certainly fewer jobs and less economic opportunity. Thanks, EPA, for following the science and recognizing – as industry has for some time, producing specific best practices for fracking – that the focus should be on continually improving safe operations and advancing technologies. These will help ensure our energy revolution goes forward.
Now, let’s talk about another country’s energy revolution – one that hasn’t gotten a lot of attention in the U.S. beyond the unfortunate, protracted debate over the Keystone XL pipeline. Canada’s own energy revolution is at the heart of the U.S.-Canadian relationship and is so integral to U.S. security. The vitality of Canadian energy is something more Americans should care about, as it bears directly and indirectly on our lives in a number of ways.
Posted May 11, 2015
Vice President Joe Biden underscored the administration’s call for infrastructure spending during a Bloomberg Government event that focused on the country’s deteriorating delivery and transportation systems.
Highlights include: The Washington politics of infrastructure spending is challenging. “The idea that there is a debate on the Hill on the need to invest in infrastructure is mind blowing,” Biden said. The world’s energy epicenter is North America, and the U.S. needs major investments in energy infrastructure. “We will face a national security dilemma” if we don’t enhance our energy infrastructure, he said. Companies need to have certainty that they can get their products to market efficiently.
Let’s pause a moment and consider these valid points on infrastructure from the vantage point of this administration’s crowning infrastructure decision (or non-decision): the Keystone XL pipeline.
In the Keystone XL, the administration has had the opportunity – for more than six years – to green light $5.4 billion in private infrastructure spending that would create jobs, boost the economy and transport oil from Canada and the U.S. Bakken region – reliably and safely – to our Gulf Coast refineries, enhancing America’s energy security. All with the simple stroke of the president’s pen.
Posted May 6, 2015
The opportunity to stimulate increased domestic production of oil and natural gas, create jobs, spur the economy and enhance America’s ability to positively shape world events is at hand – waiting only on the stroke of a pen. Lifting the United States’ four-decades-old ban on crude oil exports could help advance all of the above, and it all could be launched with the stroke of a pen.
Encana President and CEO Doug Suttles and API President and CEO Jack Gerard emphasized the relative ease with which the 1970s-era export ban could be ended, as well as the building political momentum for action, during a conference call with reporters.
Gerard said the ban could be lifted through the exercise of presidential authority or by the president signing legislation from Congress. Gerard:
“There is a consensus building in the country. We see strong bipartisan support in the House and now rolling in the Senate. So overall, we think the momentum continues to build as people better understand all of the issues. … Job creation, benefit to our trade imbalance, revenues to government, lowering the price at the pump. … It’s just a matter of time now before that pen is deployed to allow this to happen.”
Posted May 4, 2015
USA Today: The U.S. economy may not be benefiting as much as anticipated from the collapse in oil prices over the past 10 months. In fact, for oil-producing states, the decline of some 50% is taking a toll.
But one thing seems clear: The nation as a whole is nowhere near as susceptible to sharp swings in oil prices — one way or the other — as it was for decades.
That was the message from Jason Furman, the chairman of the White House Council of Economic Advisers and President Obama's chief economist, at a New York forum held by the Columbia University Center on Global Energy Policy.
Furman spoke one day before the U.S. government reported an annual growth rate of just 0.2% for the nation's gross domestic production from January through March, down substantially from a 2.2% pace in the fourth quarter of 2014.
Among the factors was consumer spending, which rose by only 1.9% in the first quarter compared with a 4.4% increase in the previous quarter.
Consumers proved slow to spend their savings from lower gasoline prices, savings that economists estimate at $700 per household, as Furman pointed out. But that reluctance may change soon, to the benefit of the nation's economy, he added.
Posted May 1, 2015
API President and CEO Jack Gerard joined members of Congress and others at a Capitol Hill press conference calling for an end to the United States’ 1970s-era ban on the export of domestic crude oil. Gerard:
“We've come to the point where we have a limitation on our ability to continue to grow this renaissance, to create good-paying jobs, to help stimulate the domestic economy. Today, there are few public policy changes that would bring as much economic value to our domestic economy than lifting the ban on crude exports.”
Texas Democratic Rep. Henry Cuellar said other Democrats will support legislation to end the export ban:
“I think we are going to get there. Once we get this on the floor, you’re going to see that we’re going to get more support from the Democratic side. … I’ll continue working with my friends across the aisle to make sure that this outdated ban on oil exports is lifted.”
Posted April 27, 2015
ConocoPhillips Chairman and CEO Ryan Lance talks with Energy Tomorrow about key industry challenges ahead and details the case for ending the United States’ 1970s-era ban on the export of domestic crude oil. Lance is a petroleum engineer with 28 years of oil and natural gas industry experience in senior management and technical positions with ConocoPhillips, predecessor Phillips Petroleum and various divisions of ARCO. His past executive assignments with ConocoPhillips have included responsibility for international exploration and production, regional responsibility at various times for Asia, Africa, the Middle East and North America, and responsibility for technology, major projects, downstream strategy, integration and specialty functions. He is a member of the Society of Petroleum Engineers, and earned a Bachelor of Science degree in petroleum engineering from Montana Tech in 1984.
Q: Given the current downturn in oil prices, talk about the key decisions ahead for the industry over the next 10 years.
Lance: We foresee several key decisions ahead for companies in our industry. First they have to determine their strategic direction. Industry has transitioned from an era of limited resource access to one that, due to the productivity of North American shale and the potential for shale development elsewhere, offers a new abundance of resources. Although many of the best conventional resource areas remain off limits in traditional exporting countries, shale and other unconventional resources offer immense potential in many areas that are accessible. So companies now have an unprecedented range of options – pursuing North American shale, international shale, deepwater development, LNG, oil sands, international exploration, and so on. Companies must determine where they have or can build competitive advantages and leverage relationships with host nations, potential partners and suppliers, and identify the long-term opportunities best for them.
Posted April 7, 2015
Following on yesterday’s post on increased domestic energy production that is backing out imports, we see that the U.S. remained No. 1 in the world in the production of petroleum and natural gas hydrocarbons last year, according to the U.S. Energy Information Administration (EIA).
The government agency responsible for quantifying all things energy says that U.S. oil and natural gas production has been trending higher than the output of Russia and Saudi Arabia, the second- and third-largest producers:
Since 2008, U.S. petroleum production has increased by more than 11 quadrillion British thermal units (Btu), with dramatic growth in Texas and North Dakota. Despite the 50% decline in crude oil prices that occurred in the second half of last year, U.S. petroleum production still increased by 3 quadrillion Btu (1.6 million barrels per day) in 2014. Natural gas production—largely from the eastern United States—increased by 5 quadrillion Btu (13.9 billion cubic feet per day) over the past five years. Combined hydrocarbon output in Russia increased by 3 quadrillion Btu and in Saudi Arabia by 4 quadrillion Btu over the past five years.
Posted April 1, 2015
News that the Interior Department has reaffirmed Shell’s right to drill in the Chukchi Sea off the Alaskan coast is an important step toward to Arctic energy development. While the company still must secure individual drilling permits and overall federal approval of its exploration plan, this week’s action advances the larger objective of safe and responsible development of an extremely valuable energy reserve. Interior Secretary Sally Jewell:
“The Arctic is an important component of the Administration’s national energy strategy, and we remain committed to taking a thoughtful and balanced approach to oil and gas leasing and exploration offshore Alaska.”
The oil and natural gas industry agrees. In official comments to the federal Bureau of Ocean Energy Management (BOEM), API and seven other industry-related associations argue that developing Arctic oil and natural gas off the coast of Alaska is essential to U.S. energy security. It’s also vital to the “long-term viability” of the Trans-Alaskan Pipeline System that connects Alaskan energy with the Lower 48. Developing Arctic energy is one of the keys to a robust offshore leasing program, which the federal government is drawing up right now.
Posted March 31, 2015
There are a number of main points in official comments submitted by API and seven other energy industry groups to the federal Bureau of Ocean Energy Management (BOEM) on its draft offshore oil and natural gas leasing program for the 2017-2022 time period.
Given how much offshore acreage was excluded from the proposed draft, BOEM should not remove any areas proposed in the draft from the final lease plan, the associations write. The government is missing key opportunities to harness U.S. offshore energy in the Atlantic, eastern Gulf of Mexico and off Alaska, as other countries are implementing robust offshore development programs. Energy development on the outer continental shelf (OCS) would generate significant job and economic benefits to the U.S., and industry continues to press ahead with technological, safety and environmental protection improvements – all designed to foster increased safety in offshore operations.
The comments are among those being collected by BOEM before it finalizes the five-year leasing program later this year. The leasing plan is a blueprint for offshore development; areas not listed in it won’t be offered for lease 2017 to 2022. Given the 10 to 15 years needed to develop offshore oil and natural gas – from the time the lease is sold to production – the federal plan is critically important.
Posted March 27, 2015
Add the heft of Rice University’s respected Center for Energy Studies to the weight of scholarly analysis urging an end to America’s four-decades-old ban on domestic crude oil exports. In a new study, the center lays out a case for U.S. crude oil exports that builds on the findings of IHS, ICF, Brookings, the Aspen Institute/MAPI and others – saying that lifting the ban would result in significant economic and foreign policy benefits to the U.S.
The study explains that the export ban already is presenting a “binding constraint” on the domestic market, leading to “discounted” pricing for lighter crudes produced by America’s energy revolution. It also notes that large volumes of lighter domestic crudes, in excess of what the U.S. refining sector can use, with no access to other markets, are discounted compared to global crude prices.