US energy, petchems say Obama inhibits oil and gas production

13 February 2013 18:29  [Source: ICIS news]

WASHINGTON (ICIS)--US energy, refining and chemical sector officials on Wednesday welcomed President Barack Obama’s promise for more domestic oil and gas production, but charged that his policies inhibit conventional energy development.

In his state of the union speech to Congress on Tuesday night, Obama noted that domestic US oil and gas production have increased at record rates in recent years and that the boom in natural gas from shale deposits “has led to cleaner power and greater energy independence”.

“We need to encourage that,” Obama said, adding: “And that’s why my administration will keep cutting red tape and speeding up new oil and gas permits.”

But Charles Drevna, president of the American Fuel & Petrochemical Manufacturers (AFPM) said that the president’s energy policy remarks “were a lesson in the art of contradiction and denial”.

“His lofty rhetoric does not meld with the reality of his actions,” Drevna said.  “While it is encouraging for the president to tout oil and gas production, our new resources boom happened on private lands in spite of his efforts.

“He says he is going to cut red tape for energy production, but all he has done is erect more barriers to production on public lands since he has been in office,” he added.

Cal Dooley, president of the American Chemistry Council (ACC), also suggested that Obama’s positive rhetoric on oil and natural gas is not necessarily reflected in the administration’s energy policies.

“We are pleased to hear President Obama commit to advancing a pro-growth, national energy strategy that will harness America’s vast energy resources, especially natural gas,” Dooley said.

However, he added, “We hope the president’s support for aggressive, responsible development of domestic natural gas will be apparent not only in his remarks, but in future actions of his administration.”

Dooley said that Obama could bring policy in line with rhetoric by opening onshore and offshore federal lands to energy development and avoid layering federal regulation of natural gas on top of existing and longstanding state rules.

The American Petroleum Institute (API) also welcomed Obama’s positive remarks about oil and gas production but questioned his commitment and policies.

“Unfortunately, 83% of the land and offshore areas controlled by the federal government are still off-limits to oil and natural gas development,” said API president Jack Gerard.

Gerard said that Obama needs to “follow through by implementing a national energy policy, lifting existing restrictions in support of responsible development of our vast energy resources and approving the Keystone XL pipeline”.

He urged the White House to stand up against “unnecessary and burdensome regulations that chill economic growth”.

The Western Energy Alliance (WEA) also accused the president of voicing support for oil and natural gas while simultaneously implementing policies that impede exploration and development.

WEA president Tim Wigley charged that while “President Obama again took credit for the improved energy profile of America, [he is] promising more polices that will continue to counteract his goals”.

“From tax increases to climate change, his policy solutions would actually undercut the very real success the private sector has achieved in progressing toward these goals,” Wigley said.

As part of his speech, Obama pledged to take independent action on global warming issues and indicated that "record-high corporate profits" should help fund alternative energy projects.

By: Joe Kamalick
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