America’s Independent Oil, Natural Gas Producers to the President: “Put Words Into Action”

America’s Independent Oil, Natural Gas Producers to the President: “Put Words Into Action”

WASHINGTON, DC – Today, at a Georgetown University speech, President Obama highlighted a host of critical energy-related issues facing America. Barry Russell, president and CEO of the Independent Petroleum Association of America(IPAA), which represents the companies that drill 95 percent of American oil and natural gas wells, issued this statement following the President’s speech:

“As Americans continue to watch before our eyes the unfolding of truly historic world events, all of which seem to directly impact our collective energy future, the President once again has an important opportunity to demonstrate bold leadership by setting our nation on a path toward increased energy security and leading a national commitment to increased domestic production of American oil and natural gas. Indeed, the President has, and at least rhetorically, embraced these common sense goals before. However, actions speak much louder than words.

“Despite the rhetoric coming from the Obama Administration, the federal government continues to add new burdens to the federal oil and natural gas leasing and permitting process. Those new burdens overlay a process that has become laden with opportunities to delay or deny access and production of America’s resources. The Administration’s latest attempt to blame domestic oil and natural gas producers for untapped US resources through the ‘use it or lose it’ issue is merely an ill-fated attempt to detract the attention of the American people from the President’s own failed energy policies.

“It is easy to tell the American people that resources are not being developed here at home because oil and natural gas companies are sitting on idle leases both offshore and onshore. What Americans aren’t told is that only seven permits have been issued in the deepwater offshore Gulf of Mexico by the Administration since last spring, and lease sales in these areas have been put on hold. Leases can’t be developed if companies don’t have the permits necessary to proceed with exploration and production activities, which take several years and billions of dollars to develop. There is also no guarantee that oil and natural gas will be found on all of the land that is leased. If no production is found, the companies already have an obligation to return the land back to the federal government by law. Independent producers reinvest 150 percent of their American cash flow back into American production. Why would producers sit on leases that will not provide them with cash flow that will provide capital for future projects?

“We are encouraged when we hear the President talk about the need to ’embrace a diverse energy portfolio’ that includes the ‘responsible development and production of oil and gas at home.’ While the President talks a good game, his administration is putting in place policies that halt, rather than encourage, the production of US energy, and instead is touting oil and gas production in other parts of the world, most recently Brazil.

“The responsible development of job-creating American oil and natural gas resources, overwhelmingly produced by small, independent operators, creates thousands of good-paying jobs while stabilizing energy costs, generates much-needed federal revenue to help pay down the skyrocketing national debt, and bolsters our national security by lessening our dependence on unstable foreign imports. Despite these clear benefits, the Administration’s current regulations, policies and proposals do quite the opposite: cost jobs, raise costs, stunt revenue and increase dependence through massive taxes, a virtual shut-down of new exploration in the Gulf of Mexico and similar slow-downs for onshore production.

“America is blessed with abundant energy resources, including a century worth of clean-burning natural gas. As world events sharpen our focus on the need to secure our own energy future, the President has a chance to pivot accordingly and put words into action by getting the Gulf back to work and encouraging the responsible production of our vast natural gas and oil resources. We remain hopeful that this opportunity won’t be another missed opportunity for America’s future.”

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Julia Bell