Tuesday, March 12, 2013

Blocked Oil Production

Agency Confirms: Obama Has Blocked Oil Production

Empty Boast: As we have noted before in our Issues & Insights pages, President Obama has taken credit for an energy boom he had nothing to do with. A government agency now confirms what many have known to be true.

The Congressional Research Service has released a report, "U.S. Crude Oil and Natural Gas Production in Federal and Non-Federal Areas," that corroborates what we've said.

"All of the increase (in oil and natural gas production) from FY2007 to FY2012 took place on non-federal lands, and the federal share of total U.S. crude oil production fell by about seven percentage points," writes Marc Humphries, the government specialist in energy policy who authored the report.
During this period, oil production on federal land fell from nearly 1.7 million barrels a day to 1.6 million. At the same time, the share of overall production on federal lands shriveled from 33% to 26%.

The difference is found in offshore production. Onshore production actually increased modestly from 2007 to 2012, but offshore dropped from 1.4 million barrels a day to 1.3 million.

The story is similar with gas. Production on federal land decreased from 5.5 trillion cubic feet to 3.7 trillion cubic feet. The federal share collapsed from 27.8% to 15.5% of the total. In the case of gas, both onshore and offshore output on federal land have fallen, with offshore tumbling 50%.

Meanwhile, private output booms. Oil production on non-federal land grew from 3.4 million barrels a day to 4.6 million and gas rose from 14.4 trillion cubic feet to 20.2 trillion.

The good times won't go on forever, though, as long as Washington insists on a close-fisted energy policy. About 43% of all domestic crude reserves are on federal land. Roughly 28% of the gas is under the federal boot.
Humphries concludes, "A more efficient permitting process may be an added incentive for the industry to invest in developing federal resources, which may allow for some oil and gas to come onstream sooner."

But that bright outlook has a dark side.
"In general," he writes, "the regulatory framework for developing resources on federal lands will likely remain more involved and time-consuming than that on private land."
Couldn't Obama change that? Couldn't he have already changed it?
Yes. But he chose instead, through his first interior secretary, to withdraw tracts of federal land that had already been cleared for oil and gas development.
He has also delayed offshore drilling, ignored a judge's order that he lift a moratorium he had placed on new drilling in the Gulf of Mexico and issued a leasing plan that, according to House Speaker John Boehner's office, "closes 85% of America's offshore areas to energy production."

"The president's plan opens no new areas to energy production and provides for the fewest number of new lease sales in history, according to the House Natural Resources Committee," said the speaker's office.

And we haven't even touched on the president's war on coal, nor on his costly green energy strategy, elements of which come crashing down in spectacular fashion on a regular basis: Solyndra, Ener1, Beacon Power, Evergreen Power, to name a few.
Despite Obama's hostility toward fossil fuels, domestic oil output recently reached its highest level since 1992, our imports have fallen significantly and good jobs have been created in the conventional energy industry by the tens of thousands.
America is fracking its way to energy independence.

But there is still one great hurdle: the Barack Obama presidency.
While it won't last forever, this administration will have been around long enough when he leaves office in 2017 to have held back a durable economic recovery and exposed the country to the strong possibility of a double-dip recession.

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