API: Obama should capitalize on US energy successes in final year

American Petroleum Institute Pres. Jack N. Gerard urged US President Barack Obama to pursue energy policies in the final year of his presidency that capitalize on successes in increasing oil and gas production, strengthening the general economy, and reducing greenhouse gas emissions.

“In this New Year, let us all resolve to work together toward a shared vision of a world where everyone—without regard to zip code, state, nation, continent, or hemisphere—has access to reliable, safe, and affordable energy,” Gerard said in his keynote remarks as API released its State of American Energy 2016 report on Jan. 5.

“And it will keep the energy conversation focused on what’s most important: Energy’s role in increasing American prosperity, long-term job creation and environmental opportunity, environmental improvement, and enhanced national security,” Gerard stated.

Gerard said the country’s simultaneous emergence as the world’s top energy producer, its solid economic growth, and its global leadership in curbing GHG emissions is “a trifecta of success unmatched by any other nation,” adding, “We call it the US model.”

He said support is growing in Congress for this style of energy politics, as evidenced by its bipartisan approval of an omnibus budget bill last month, which included a repeal of the 40-year-old ban on exports of US-produced crude oil (OGJ Online, Dec. 18, 2015), that Obama signed into law. “Congress’s action was a victory of long-term vision and fact-based policymaking over political ideology and ideological dogma,” Gerard said.

“Still, there is an ardent few who continue to believe that keeping our nation’s abundant energy resources in the ground is a credible and viable strategy,” he said. “There are some in government who will advance their favored forms of energy to that dubious and untested end, heedless of the potential harm it could cause our economy, how much it could cost the American consumer, or how it could impede continued environmental investment.”

Problems to address

Gerard said Obama’s administration should address problems with the federal Renewable Fuel Standard; revise its Clean Power Plan, which purports to improve the environmental but actually tries to pick winners and losers; and improve oil and gas transmission systems instead of discourage their construction.

“Another example of why policy matters when it comes to energy is the glaring difference between production on state and federally-controlled land,” he said. “Federal data show crude oil production remained flat between 2009 and 2014 on federally controlled land while gas production declined 35%. By contrast, on private and state lands where development does not need federal government permission, production increased 88% for crude and 43% for gas. These dramatically different trend lines are a function of political ideology, not geology.”

The US success as a global energy production and carbon reduction leader is rooted in the nation’s unique federal system which allows states to be active and semi-autonomous actors in developing resources, Gerard said.

“As the State of American Energy report details, the states demonstrate time and again that the best way forward on energy policy is not through legislative mandate, overreaching regulatory oversight, or executive decree, but by using the facts, including what’s worked and what’s best for our energy future, the economy, consumers and the environment as the guiding principle,” he said.

States already have shown how bipartisan compromise, consensus building, and collaboration with industry can lead to significant increases in energy production and environmental protection, Gerard said.

“As the president’s last full year in office begins, we hope that he will take note of and help foster the US model,” he said. “We hope that he’ll note that the already heavy regulatory burden—almost 100 pending regulations and counting—upon the oil and gas industry could hinder, rather than advance, what he hopes to be one of his administration’s defining legacies: environmental improvement.”

Contact Nick Snow at nicks@pennwell.com.

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