Obama touts record U.S. oil and gas production in wake of pipeline rejection
Rejecting both the Republican push for an accelerated Keystone XL oil pipeline and the GOP argument that he doesn’t care about jobs, President Barack Obama Wednesday touted his record of increased domestic oil and gas production.
“Under my administration, domestic oil and natural gas production is up, while imports of foreign oil are down,” Obama said, adding that trend will continue “in a way that benefits American workers and businesses without risking the health and safety of the American people and the environment.”
Obama wants more time to study the potential environmental impacts of the proposed Keystone XL pipeline, which would transport tar sands oil from Alberta, Canada, to the Gulf Coast of Texas, and he also wants to identify an alternative route that doesn’t cross Nebraska’s sensitive Sandhills region. Canadian Prime Minister Stephen Harper reportedly told Obama his nation will now look to China.
U.S. House Leader Eric Cantor, a Virginia Republican, chided Obama for his decision to keep studying the project: “There is no question that our belief is the President’s policies have consistently failed to create jobs. This decision is another wrong move for America and the small businesses that we need so desperately to start creating jobs again.”
But a little over a week ago the U.S. Department of Interior reported oil and gas production on federal land across the American West is at an all-time high, and Obama administration officials say that’s a sign their more enviro-friendly federal leasing reforms haven’t hurt domestic drilling.
In fact, Interior Secretary Ken Salazar, a former Democratic senator from Colorado, reported that leasing reforms on U.S. Bureau of Land Management (BLM) land led to a decrease in protests from environmental groups and a 20 percent increase in lease sale revenues in 2011 compared to 2010.
In 2011, the BLM conducted 32 onshore oil and gas lease sales, offering 1,755 parcels of land covering nearly 4.4 million acres. Nearly three-quarters of the parcels offered (1,296 parcels of land) were sold, generating nearly $256 million. The BLM plans another 32 lease sales this year.
“This is an example of the power of a common-sense approach to growing America’s energy economy on public lands,” Salazar said in a release. “The Obama Administration is moving ahead with a comprehensive energy plan for the country that is enhancing our energy security, creating jobs, and improving protections for our land, water and wildlife.”
Matt Garrington, Denver-based deputy director of the Checks and Balances Project, said the new onshore leasing numbers “show how responsible drilling, clean air and water protections, and increased revenues can all go hand-in-hand.” He added that onshore oil and gas production is booming on public lands.
“Leasing, permitting, and drilling continue to rise under the Obama administration,” Garrington said. “But facts don’t matter to the oil and gas industry, who whine for more of our public lands. The truth is that industry is sitting pretty on tens of millions of acres open for development and billions in profits.”
Garrington points to statistics showing federal onshore natural gas production in 2011 reached the highest level (5.3 million cubic feet) reported since the BLM started tracking production in 1984. He added that the BLM issued 150 more drilling permits in 2011 than the previous year.
“I find it amusing that the Wilderness Society, Checks and Balances and other activist groups with no actual experience developing energy fall over themselves to interpret any new data as a reason to call for slowing economic development and job creation in the energy industry,” said Kathleen Sgamma, vice president of government and public affairs for the Denver-based Western Energy Alliance.
“The information released [by the BLM] showing increased natural gas production is a testament to the productive capacity and innovation of the industry, which is part of the broader natural gas success story of 2011,” Sgamma said. “Because of the 5- to 10-year bureaucratic lead time on public lands, production today is the result of actions taken years ago in prior administrations.”
Garrington, however, counters that the oil and gas industry continues to call for more BLM lease sales despite failing to develop two thirds of the public lands currently leased for drilling. “America’s public lands are open for business when it comes to energy development,” he said, pointing to the fact that 4,380,275 acres of BLM land are leased for drilling in Colorado but only 1,467,839 (or about 33.5 percent) are currently in production.
Sgamma says that percentage is higher if exploration is taken into consideration. She references the Interior Department’s Oil and Gas Lease Utilization Report (pdf).
“That report showed that 43 percent of leased acreage is in production or exploration,” Sgamma said. “Exploration must take place before a lease goes into official, full production mode. Before both the exploration and production phases, the government must complete environmental analysis as required by NEPA, and currently there are long delays in that process.”
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