Te State o American Energy
Public Policy Impacts onDomestic Energy
Despite the clear benets o developing domestic oil and naturalgas resources—job creation, economic growth and energy security—the industry still aces public policy obstacles:
85 percent o America’s oshore acreage is o-limits todevelopment, and 60 percent o ederal onshore lands areo-limits;
Sluggish leasing and permitting processes are also barriers thatcreate uncertainty or an industry that requires long leadtimes; and
Overly burdensome regulations discourage investment—eventhough the president himsel has called or the elimination o ederal regulations that overly burden those businesses that aretrying to create jobs.
Te U.S. oil and natural gas industry needs legislative, regulatory,permitting and leasing processes that are thorough, ecient andpredictable. Tat means allowing or exploration and productiono much-needed energy resources and ensuring that developmenttakes place in a responsible and sustainable way withoutunnecessary regulatory impediments or delays.Te consequences o poor public policy choices are undeniable.For instance, as a result o the oshore drilling moratorium anduncertainty about uture permitting, 11 drilling rigs, representing 14 projects, have let the Gul o Mexico since April 2010, taking $21.4 billion in investments with them.
An estimated 91,000 jobs were lost as a result o themoratorium in 2011; and
An estimated $18.3 billion o previously planned capital andoperating expenditures did not occur in 2010 and 2011.
Canada, one o the United States’ strongest allies and the largestsupplier o imported oil to the United States, is prepared to doeven more, but the Keystone XL pipeline project is still awaiting approval ater several years o review. Project approval wouldprovide a signicant boost to U.S. energy security, bringing anextra 830,000 barrels o oil per day to the market—about hal o what America imports rom the Persian Gul.
Currently, the lack o sucient pipeline capacity rom Canada constricts Gul Coast reneries’ access to an essential market o available oil. Additional pipeline capacity could provide U.S.reneries more supply fexibility, thereby increasing U.S. energy security and retaining jobs.
“The natural gas and oil industry is vital to the U.S.economy, generating millions of high-paying jobsand providing tax revenues to federal, state, andlocal governments.”
What the Industry is Doing
Te U.S. oil and natural gas industry has a long-standing commitment to saety and environmental protection, with morethan 600 standards covering every aspect o the oil and naturalgas business: exploration and production, rening, measurementoperations, marketing and pipeline operations. From “wellsto wheels,” the industry strives to keep workers, consumers,surrounding communities and the environment sae.Since 2000, the industry has invested more than $2 trillion in U.S.capital projects to advance all orms o energy, including alternativesand renewables—roughly $6,400 or each American citizen.
Between 2000 and 2010, the industry invested $71 billion intechnologies that reduce greenhouse gas (GHG) emissions, armore than the ederal government ($43 billion), and almost asmuch as the rest o private industry combined ($74 billion).
Te industry also directly reduced GHG emissions by almost 56 million metric tons o CO
equivalent between2009 and 2010.
Te industry’s investment in emerging technology is signicant,representing more than $9 billion in non-hydrocarbontechnologies, such as wind power, rom 2000 to 2010, which was one o every ve dollars invested rom all sources.
Since 1990, the U.S. rening industry has spent about$128 billion on environmental upgrades, including thoseto produce cleaner uels.
Te industry also invested nearly $38 billion in development o clean-burning natural gas rom shale between 2000 and 2010, andproduction o natural gas rom shale ormations grew by an averageo 48 percent per year rom 2006 to 2010.
Development o shale resources is a game changer and isresponsible or:
Supporting 600,000 jobs in 2010;
Contributing more than $76 billion to U.S. gross domesticproduct (GDP) in 2010; and
Contributing $18.6 billion in ederal, state and localgovernment tax and ederal royalty revenues in 2010.
With appropriate policies, including expanded access, shaledevelopment could support more than 1.6 million jobs by 2035;could triple contributions to U.S. GDP to $231 billion in 2035;and could more than triple government tax and royalty revenuesto $57 billion by 2035—generating more than $933 billion inederal, state, and local tax and royalty revenues over the next 25years on a cumulative basis.
Renewable energy sources are an important part o America’suture energy mix, and urther industry developments and new technologies to advance energy eciency will also play a criticalrole in maximizing uture resources.But it is also evident that or at least the next 50 years, and possibly much longer, a majority o America’s energy supply will come romossil uels. Te U.S. oil and natural gas industry is developing alternative technologies that will play an increasingly importantrole in our energy uture even as it continues supplying the oiland natural gas that will be our nation’s primary energy source ordecades to come.
– National Petroleum CouncilSeptember 2011