New House Bill critical to preserving U.S. energy security

E&E News has reported House Republicans have proposed a new piece of legislation to support infrastructure development and energy security amid President-elect Biden’s proposed oil and gas drilling ban on public lands. Rep. August Pfluger of Texas has proposed a bill entitled “Saving America’s Energy Future Act” (H.R.218) that would restrict the secretaries of the Interior and Agriculture from implementing a moratorium on oil and gas leases on federal lands. Rep. Pfluger expressed concern regarding the negative implications a drilling ban would create for the U.S. energy sector:  

“President-Elect Joe Biden campaigned on the promise to shut down drilling on all federal lands and phase out fossil fuels. This, in conjunction with ludicrous policies like the Green New Deal, could mean the end to our oil and gas industry and the American economy as we know it. The Permian Basin produces over 40% of our nation’s energy. This is clean, affordable, reliable energy that powers our nation, heats our homes, and allows us to defend ourselves. Energy security is national security, and nothing could be more important.”

Other House Republicans are backing Rep. Pfluger, including Reps. Tony Gonzales, Ronny Jackson, Pat Fallon, Brian Babin, and Jodey Arrington of Texas, Rep. Yvette Herrell (R-N.M.) and Rep. Stephanie Bice (R-O.K.). The state representatives hope the bill will yield a positive impact on U.S. energy security and economy as a drilling ban could pose a number of threats.

The American Petroleum Institute (API) has also released a study warning of the harmful implications such a ban could cause. U.S. oil imports from foreign sources could increase by 2 million barrels a day, putting our energy security in the hands of potentially unpredictable foreign regimes. U.S. households could spend a cumulative $19 billion more on energy by 2030 and nearly 1 million jobs could be lost by 2022. After sky-high unemployment rates and an oil crash induced by the COVID-19 pandemic, our nation cannot afford to endure another dire economic risk.

H.R.218 is crucial to protecting U.S. domestic energy production. Speaking of the bill, Rep. Ronny Jackson (TX-13) said:

“As someone who grew up working as a roustabout in the West Texas oil fields, I know firsthand how important oil and gas production is to our economy in Texas’ 13th Congressional District…I am proud to co-sponsor legislation like the Saving America’s Energy Future Act. This legislation will go a long way to help maintain America’s energy independence and Texas’ position as the nation’s leading oil and gas producer.”

Enbridge Inc. Line 3 pipeline wins final permit approval

In a win for our nation’s energy security and domestic energy capabilities, E&E News reported Minnesota regulators have given Enbridge Inc.’s Line 3 upgrade project final approval to move forward into construction. The Minnesota Pollution Control Agency issued a construction stormwater permit allowing Enbridge to replace and expand its aging Line 3 system across the state. Recognizing this milestone, Enbridge Executive Vice President Vern Yu said:

“This is a historic day for the Line 3 project which will strengthen the safety of the system for years to come…With all of the permits in hand, we can now start construction.”

E&E News reported the $2.6 billion Minnesota-based portion of the project would generate 4,200 construction jobs. This is huge success for Minnesota – as the state’s unemployment rate sunk even further in October 2020 – down 1.3% to a low of 4.6%. In addition to providing economic benefits, the project will be more environmentally friendly than other means of transportation. The Line 3 Replacement pipeline will transport 760,000 bpd which is the equivalent of 10,000 rail cars per day or 24,000 tanker trucks per day. This project should not be an option for Minnesota – it is a necessity for safe crude oil transit across a number of states.

Although the project has received pushback from environmentalists and local Native American tribes, the update to the pipeline is necessary for continued safety of the project and to minimize any environmental risk as the original pipeline was built in the 1960s.

Proponents of the project have ensured the public that the project is strong. Vice President for midstream at the American Petroleum Institute Robin Rorick stated:

“Enbridge’s approach to the replacement of Line 3 will ensure minimal impacts to the environment and safe operations while providing the reliable and affordable energy that powers the lives of American families and small businesses.”

The GAIN Coalition applauds Minnesota regulators for issuing a final approval for the Line 3 system upgrade. Enbridge plans to begin construction by the end of this year.

Wyoming to support oil and gas projects in the state with COVID-19 relief funding

The Associated Press reported Wyoming will employ federal coronavirus relief funding to help push forward oil and gas projects that have been idle amid pandemic-induced shutdowns. The pandemic has taken a toll on a number of industries – and the nation’s oil and gas industry is no exception. Federal support for an industry that is critical to national security and energy independence should continue to remain a top priority as more COVID-19 related shutdowns that may harm key industries can be expected under a Biden administration. AP News reporter Mead Gruver writes:

“These funds will have a direct impact on Wyoming’s employment rate and put people back to work in our oil and gas sector,” Wyoming Gov. Mark Gordon, a Republican, said in a statement Tuesday announcing up to $15 million in assistance through a new Energy Rebound Program.”

The $15 million in funding through the Energy Rebound Program would directly impact Wyoming’s employment rate and bring back jobs in the oil and gas sector. The federal funding comes directly from the CARES Act and will help to complete oil and gas wells in addition to cleanup efforts. Operators in Wyoming will be able to benefit from up to $500,000 in aid from this plan. An official statement from Gov. Gordon’s office reads as follows:

“When global demand for oil plummeted due to COVID, work stopped almost immediately, with oil and gas companies conducting a few activities to safely stop ongoing drilling and reclamation activities. This left many projects in limbo, awaiting capital to continue.

The use of the funds will provide a stimulus to the economic recovery. Funds would be used to commence operations that would include the hiring of crews, many of whom would stay at hotels near the project, water acquisition, ordering of supplies and equipment for drilling and re-completions, and plugging and abandonment activities.”

Wyoming plays a significant role in national energy production – and the Energy Rebound Program will play a key role in bolster this critical industry. In 2019, Wyoming ranked eighth nationally in both crude oil and natural gas production, producing 102.1 million barrels of crude oil that same year. Wyoming’s energy industry plays a valuable role in powering our nation and this funding will be critical in salvaging one of America’s cornerstone sectors.

To learn more about Wyoming’s Energy Rebound Program, please visit https://www.wyomingbusiness.org/.

Trump Administration Issues Executive Order on “Modernizing America’s Water Resource Management and Water Infrastructure”

This week the Trump Administration continued its efforts to streamline and modernize regulations surrounding our nation’s infrastructure, now including America’s water resources and accompanying infrastructure.

On October 13, 2020, President Trump issued an executive order outlining reforms to the organization of agencies and agency efforts towards water management and infrastructure.

It reads: “Abundant, safe, and reliable supplies of water are critical to quality of life for all Americans, fueling our economy, providing food for our citizens and the world, generating energy, protecting public health, supporting rich and diverse wildlife and plant species, and affording recreational opportunities. While America is blessed with abundant natural resources, those resources must be effectively managed, and our water infrastructure must be modernized to meet the needs of current and future generations.

Executive departments and agencies (agencies) that engage in water-related matters, including water storage and supply, water quality and restoration activities, water infrastructure, transportation on our rivers and inland waterways, and water forecasting, must work together where they have joint or overlapping responsibilities. This order will ensure that agencies do that more efficiently and effectively to improve our country’s water resource management, modernize our water infrastructure, and prioritize the availability of clean, safe, and reliable water supplies.”

The executive order keeps in the vein of other regulatory changes by the Administration, particularly those to the National Environmental Protection Act and the EPA’s Cost-Benefit Analysis protocols, by consolidating management and clarifying objectives while removing duplicative regulation to improve outcomes.

A major portion of the executive order is the establishment of the Water Subcabinet. Secretaries of the Interior, Commerce, Agriculture, Energy, and Army will join the Administrator of the Environmental Protection Agency as co-chairs on the Subcabinet.

The objective of the Subcabinet will be to streamline the Federal government’s approach to water resources while upgrading water infrastructure, public health safeguards, and creating jobs. Another priority will be the development of a national strategy to improve water storage and supply, drought resiliency, and source water protections. Additionally, advancement in water data management, research, modeling, and forecasting will fall to the Subcabinet.

Water is more essential a resource than any other to the wellbeing of Americans and the Trump Administration deserves recognition for addressing it head on. Moreover, the Administration has repeatedly shown a sharp eye to removing duplicative regulations enacted by prior Administration that bodes well for the effectiveness of this executive order.

Simultaneously, the Administration has put an emphasis on bolstering the water workforce during the toughest of times for many. As infrastructure buildout in so many industries, especially energy, has shown – it is a jobs creator.

GAIN is looking forward to the enactment and success of President Trump’s executive order.

Democrats Must Preserve an ‘All-of-the-Above’ Energy Strategy

Real Clear Energy published an opinion editorial from Col. Tom Magness, a former commander in the U.S. Army Corps of Engineers, regarding the energy strategy of Democratic presidential nominee Joe Biden. Magness remarks how Biden is proposing a $2 trillion public spending project that lacks detail and will leave taxpayers to pay the price. Biden’s proposed plan strays further left from President Obama’s moderate “All-of-the-Above” energy strategy – which proved to be largely successfully.

Magness explains the significant gains in the energy sector the U.S. has made over the past decade, writing:

“The growth of the U.S. natural gas industry under the Obama administration lowered household energy costs, created jobs, contributed to a major reduction in emissions, and played a significant role in accelerating the country’s recovery from the 2008 Financial Crisis. This was, and has remained under President Trump’s leadership, the right path for Americans.

Under President Trump American energy continued to make gains in energy sufficiency and production, as well as emissions reductions to the benefit of the American economy. This includes the largest absolute reduction in emissions by any country since 2000; adding tens of thousands of jobs thanks to large scale energy infrastructure projects like Keystone XL and Dakota Access; and an expectation to be a net energy exporter by the close of 2020.”

Considering the vast environmental and economic achievements made over the past decade, we cannot afford to reverse such important success.. Pipeline projects, which help transport oil and natural gas, are a key part of keeping up this success. With brutal economic hardships brought on by the COVID-19 pandemic in 2020, Americans cannot afford higher energy costs, increased tax rates, and potential employment cuts over the next four years. Magness emphasizes the benefits of continued reliance on pipeline projects:

“A recent report from the Consumer Energy Alliance found that delays, obstruction, and cancellation of pipeline projects are threatening nearly $14 billion in economic activity, over 66,000 jobs, and more than $280 million a year in state and local tax revenue – crucial investment and employment that could go a long way in our nation’s long road to a COVID-19 recovery.”

In closing, Magness highlights how Joe Biden’s campaign should reconsider President Obama’s realistic approach of an “all-of-the-above” strategy. Magness concludes:

“A strong embrace of an all-of-the-above approach could reshape the debate on energy and curtail the unrealistic policies now championed by the left. Perhaps some draft language for the campaign reads: the continued development of safe and responsible natural gas production and accompanying infrastructure is not just compatible with, but a precondition of, a resilient economy and a cleaner future.  Surely on that we can all agree.”

Audio News Release: API Report highlights the negative impacts of a Dakota Access shutdown

This week, an audio news release is circulating radio in North Dakota and Washington D.C. regarding the impacts of a Dakota Access shutdown based on a study from the American Petroleum Institute. See below for the full Audio News Release:

Introduction: This month, the American Petroleum Institute (API) released a study warning of the negative economic impacts of a Dakota Access Pipeline shutdown. The report finds a shutdown of the pipeline could cause tax revenues to go down, unemployment to go up, and threaten national security.

Craig Stevens, spokesman of “Grow America’s Infrastructure Now” said:

“Shutting down the Dakota Access pipeline would hurt North Dakota communities and our nation’s economy by bringing about higher energy costs. Specifically, according to API, about 3,000 jobs would be cut over the next year and a half and make our country more reliant on foreign sources of energy and give an upper hand to nations like Iran, Venezuela, and Russia.

We simply cannot afford to put our nation’s energy and national security at great risk. The Dakota Access pipeline must remain operational.”

Outro: To read the full report, visit API.org. For additional information, visit gainnow.org.

API Study Finds Federal Leasing Ban a Hamper to American Energy Success, Security and Prosperity

On the back of news President Trump has decided to support a moratorium on offshore drilling off Florida, Georgia and South Carolina coasts as well as candidate Biden’s commitment to banning federal leasing practices the American Petroleum Institute has published a study analyzing the impacts of a federal leasing ban (which would halt offshore operations).

The skinny on the study is this: with a federal leasing ban progress in the American energy space would suffer dramatically, and as American Petroleum Institute CEO Mike Sommers noted would “return us to the days of relying on foreign energy sources hostile to American interests,” and is “ultimately a choice between American-made energy and foreign energy, a choice between American jobs and foreign jobs. It’s clear a federal leasing ban should be off the table – there’s far too much at stake for American workers, local economies and our nation’s energy security.”

Each year the Bureau of Land Management organizes lease auctions for access to federal lands. Energy companies then bid for these leases and the opportunity to access natural resources on those lands.

The Congressional Research Service has shown that 26% of the country’s crude oil reserves and 22% natural gas reserves are on federal land. Although production on nonfederal land has jumped in the past decade, federal leasing operations make up a significant portion of American energy and are essential to hopes of keeping the country a net energy exporter as well as preserving the many benefits that come along with that position.

The American Petroleum Institute sought out to quantify the costs of a ban on federal leasing. The report shows that a federal leasing ban today would result in the country spending a half trillion dollars to offset production cuts on federal lands by importing some 2 million barrels of oil a day from foreign sources.

As the coronavirus pandemic has shown, shocks to the energy industry ripple throughout the American economy.

A ban on federal leasing would mount to a similar shock and the Institute estimates that the GDP would fall by $700 billion through 2030 and government tax revenues would decrease by $9 billion. An important component of federal leasing is its tax generation, much of which is directed to fund Land and Water Conservation Fund, our nation’s largest conservation fund.

Because of the widespread reserves and operations nationwide American workers would suffer with Texas expected to lose 120,000 jobs, New Mexico an added 62,000, and Wyoming 33,000 jobs. The Institute suggests as many as 1 million jobs could be lost by 2022, especially in energy producing heavy states.

Lastly, it is important to consider the environmental progress afforded by natural gas. As a less carbon-intensive (and plentiful) resource, natural gas availability helps displace coal-fired energy and allows the country to reduce greenhouse gas emissions in the process.

How can the country continue to make environmental gains by hamstringing the very resource central to reducing emissions? Elected officials have left the question unanswered but it is clear that environmental progress would stall with a federal leasing ban.

By banning federal leasing practices the country will undermine and undo great progress in the energy industry towards energy security. In the process of becoming energy sufficient the economic successes (and availability of affordable energy) have uplifted many Americans – the story will be different without federal leasing.

A Dakota Access shutdown could hinder food supply

Calls from environmentalists to shutdown pipelines like Dakota Access fail to shed light on the harsh unintended consequences of their opposition. Law360 recently reported eleven states have argued in an amicus brief how a DAPL shutdown could harm their food supply, raise food prices, and negatively impact the agriculture sector:

“In an amicus brief filed Wednesday, the states said that vacating an easement for the pipeline — which a lower court has ruled necessary for a thorough environmental review — would only cause hardship for American farmers. That’s because crude oil displaced from the pipeline would compete for rail space against the much less valuable cereal grain produced in Midwestern states, leading to rail congestion while the environmental impacts of the already-built pipeline are reevaluated.

The outcome of the review won’t cause the pipeline to be shut down forever, the states said. But it would cause immediate hardship and strain on the American food supply chain at a particularly vulnerable time, they said. “Particularly amidst a global pandemic, the risk of creating conditions for food insecurity in various pockets of the country — and of bankrupting farmers — makes vacatur inappropriate.”

With U.S. food supplies taking a hit throughout 2020, we cannot afford to hinder our nation’s food supply in any manner. During the onset of the pandemic, Forbes reported major grocery stores like Walmart and Harris Teeter struggled to restock shelves due to a lack of truck drivers and logistical concerns. With continued uncertainty surrounding COVID-19, shutting down DAPL could cause transit issues for food and cause unnecessary harm to the already-dwindling economies in many states.

Food security is not the only reason to be weary of a DAPL shutdown. The economic ramifications are significant. Even more workers in the oil and gas sector would be laid off and forced to find new jobs amidst a record national unemployment rate. State economies would suffer from a major cut in tax revenue supported by the pipeline – leading to funding cuts for state programs and other public works projects:

“In addition to the 11 states, North Dakota likewise filed an amicus brief on Wednesday, arguing that shutting down the pipeline would disrupt tax revenues and funding for specific special funds set up by the state legislature. Those include hundreds of millions of dollars that have been allocated for school funds, tribal government funds, tax relief funds and budget stabilization, the state said.”

The ball now lies in the D.C. Circuit’s court. A DAPL shutdown could lead to drastic consequences for a number of states and their consumers. We must carefully consider the big picture and potential unintended consequences, prioritizing facts rather than emotion and rhetoric, when it comes to shutting down much-needed pipelines.

GAIN Statement on Completion of Lone Star Express Pipeline Expansion Project

Today, Energy Transfer announced the completion of the Lone Star Express Pipeline expansion project in Texas. The project, completed ahead of schedule, will alleviate infrastructure constraints in the Delaware and Permian basins. The expansion project adds approximately 400,000 barrels per day of natural gas liquids capacity to the Lone Star Express 30-inch pipeline south of Fort Worth, Texas. The Lone Star pipeline system connects into Energy Transfer’s Mont Belvieu facility along the U.S. Gulf Coast that strategically connects to a number of facilities across the region.

Below is a statement you can attribute to me, Craig Stevens, spokesman for the GAIN Coalition:

“The GAIN Coalition congratulates Energy Transfer on the successful completion of the Lone Star Express Pipeline expansion project. Infrastructure development projects in the Permian and Delaware basins like the Lone Star Express are critical to strengthening the national economy, improving energy security, and alleviating transportation bottlenecks.

The Lone Star Express Pipeline expansion will serve the 13 counties it traverses for years to come with approximately $5 million in tax revenues. GAIN looks forward to the continued growth of the energy industry in Texas.”

Audio News Release: GAIN applauds Kinder Morgan for Rerouting Permian Highway Pipeline around Blanco River

This week, an audio news release is circulating radio in the state of Texas applauding Kinder Morgan for rerouting the Permian Highway Pipeline around the Blanco River. See below for the full Audio News Release:

Introduction: Earlier this month, pipeline builder Kinder Morgan announced a minor reroute of its Permian Highway Project around the Blanco River in Central Texas. The company announced the new route after consulting with the U.S. Army Corps of Engineers, the Texas Railroad Commission, and local landowners. 

Craig Stevens, spokesman of “Grow America’s Infrastructure Now” said:

“We applaud Kinder Morgan and the Permian Highway Pipeline engineers who worked with regulators, local leaders, and landowners to develop this route adjustment around the Blanco River. The natural gas and oil industry is leading in the development of energy resources in the Permian region, bringing jobs, economic prosperity, and tax revenues to the Lone Star State.

Once operational, the $2 billion dollar Permian Highway Pipeline will safely and reliably transport Permian natural gas to the Gulf Coast for use across the United States and around the world.”

Outro: For more information, visit gainnow.org.