American energy is facing a new reality as it enters into 2013 – a reality of vast and domestic resources of oil and natural gas through investments made in jobs and technologies. With this new reality comes the need for a new way of thinking, API president and CEO Jack Gerard said.
Gerard suggested it was time for the country to approach domestic energy resources in a new way during his annual State of American Energy address in Washington, D.C., earlier this month.
“The reality is that our energy supply is no longer limited, no longer foreign, and no longer finite – but is now American and abundant, greatly enhancing our national security,” he said. “We have a game-changing opportunity to make the U.S. the global leader in energy. If we seize the opportunity now, we will be in position to lead for decades and realize the economic and energy security benefits of that leadership.”
An increase in domestic energy activity will bring more economic growth, job creation, government revenue, and energy security, Gerard said, adding that the Congress, administration and industry need to work together to find a positive way to foster the growth.
Gerard said the industry received encouragement from President Obama’s 2012 campaign comments supporting an all-of-the-above agenda on energy, along with his statements outlining specific support for oil and natural gas production.
However, geopolitical turmoil in Washington can cause Americans to question whether leaders can work together in a bipartisan manner. For Gerard, there is no other way but to work together.
“We can offer solutions to some of the most pressing issues that will impact our economic future: tax reform, infrastructure improvements, leasing permitted on federal lands, and regulations that don’t add unnecessary layers of compliance burdens on top of existing protections and ensuring that regulations won’t compromise our ability to grow the economy and create jobs to domestic energy,” he said.
During the last few years the oil and natural gas industry has been a bright spot in an otherwise sluggish economy, Gerard said, referring to a Wood Mackenzie report that indicated the industry has:
• Supported 9.2 million American jobs and could easily support an additional 1.4 million jobs by 2030 through the industry’s investments in energy production and refining.
• Contributed $545 billion in capital investment, wages and dividends yearly.
• Contributed $86 million a day to the federal government. With access to areas that are now off-limits and the implementation of other pro-development policies, more than $800 billion additional government revenues could be generated through 2030.
Industry growth has been partly because of geology and resources in the U.S., but also because of private investment and investors who have taken risks. These risks, Gerard said, have been the catalyst for economic growth and jobs in the energy industry and manufacturing and other industrial sectors.
The key for continued growth is a well-handled energy policy. The industry needs to be able to access and develop resources, find extraction technologies and potentially export products.
While Gerard thinks that federal policies have been a hindrance to oil and gas development, he says the solution lies in how states have handled permitting and leasing to state and private lands.
“If federal policy mirrored the example and the model of what our governors are doing, it would be a game-changing opportunity,” he said.